IDEX CORP /DE/, 10-Q, 1996-08-13

IDEX CORP /DE/
10-Q, 1996-08-13
PUMPS & PUMPING EQUIPMENT

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<PAGE> 1

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q

X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
- -----
SECURITIES EXCHANGE ACT OF 1934

For the quarter ended June 30, 1996

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
- -----
SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number 1-10235

IDEX Corporation
----------------------------------------------------
(Exact name of registrant as specified in its charter)

Delaware 36-3555336
- -------------------------------------- --------------------------------------
State or other jurisdiction of (I.R.S. Employer
Incorporation or Organization Identification No.)

630 Dundee Road
Northbrook, Illinois 60062
- -------------------------------------- --------------------------------------
(Address of principal (Zip Code)
Executive Offices)

Registrant's telephone number, including area code (847) 498-7070
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changes since last
report.

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
----- -----

Number of shares of common stock of IDEX Corporation ("IDEX" or the
"Company") outstanding as of August 12, 1996: 19,267,471 shares.

Documents Incorporated by Reference: None.
<PAGE> 2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

IDEX CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31
1996 1995
------------ ------------------
(UNAUDITED)
<S> <C> <C>
ASSETS

Current assets
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . $ 6,766 $ 5,937
Receivables - net . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,540 70,338
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93,864 101,052
Deferred taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,944 7,045
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,038 1,527
--------- ---------
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . 180,152 185,899
Property, plant and equipment - net . . . . . . . . . . . . . . . . . . . . . 90,077 91,278
Intangible assets - net . . . . . . . . . . . . . . . . . . . . . . . . . . . 180,029 184,217
Other non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . 4,773 4,728
--------- ---------
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 455,031 $ 466,122
========= =========

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities
Trade accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . $ 32,331 $ 36,846
Dividends payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,069 3,061
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37,355 42,901
--------- ---------
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . 72,755 82,808
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185,650 206,184
Other non-current liabilities . . . . . . . . . . . . . . . . . . . . . . . . 25,407 26,185
--------- ---------
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . 283,812 315,177
--------- ---------

Shareholders' equity
Common stock, par value $.01 per share;
Shares authorized:
1996: 75,000,000
1995: 50,000,000
Shares issued and outstanding:
1996: 19,183,661
1995: 19,130,284 . . . . . . . . . . . . . . . . . . . . . . . . . . 192 191
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . 86,976 86,118
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86,472 67,729
Accumulated translation adjustment . . . . . . . . . . . . . . . . . . . . . (2,421) (3,093)
--------- ---------
Total shareholders' equity . . . . . . . . . . . . . . . . . . . . . . . . 171,219 150,945
--------- ---------
Total liabilities and shareholders' equity . . . . . . . . . . . . . . . $ 455,031 $ 466,122
========= =========
</TABLE>

- ---------------
See Notes to Consolidated Financial Statements.

1
<PAGE> 3

IDEX CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
For the Second Quarter Ended June 30, 1996 1995
---------- ----------
(UNAUDITED)
<S> <C> <C>
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 131,169 $ 127,203
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80,116 78,030
-------- --------

Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,053 49,173
Selling, general and administrative expenses . . . . . . . . . . . . . . . . . 26,084 24,976
Goodwill amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,232 1,050
-------- --------

Income from operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,737 23,147
Other income (expense) - net . . . . . . . . . . . . . . . . . . . . . . . . . (96) 41
-------- --------

Income before interest expense and income taxes . . . . . . . . . . . . . . . . 23,641 23,188
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,066 3,941
-------- --------

Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 19,575 19,247
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 6,913 6,928
-------- --------

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 12,662 $ 12,319
======== ========

Earnings per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . $ .64 $ .63
======== ========

Weighted average common shares outstanding . . . . . . . . . . . . . . . . . . 19,823 19,701
======== ========
</TABLE>

- ---------------
See Notes to Consolidated Financial Statements.

<PAGE> 4

IDEX CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
For the Six Months Ended June 30, 1996 1995
---------- ----------
(UNAUDITED)
<S> <C> <C>
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 265,055 $ 243,783
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 162,338 149,537
--------- ---------

Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,717 94,246
Selling, general and administrative expenses . . . . . . . . . . . . . . . . . 53,100 48,615
Goodwill amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,464 2,010
--------- ---------

Income from operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47,153 43,621
Other income (expense) - net . . . . . . . . . . . . . . . . . . . . . . . . . (53) 50
--------- ---------

Income before interest expense and income taxes . . . . . . . . . . . . . . . . 47,100 43,671
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,291 7,607
--------- ---------

Income before income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 38,809 36,064
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 13,933 12,983
--------- ---------

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 24,876 $ 23,081
========= =========

Earnings per common share . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1.26 $ 1.17
========= =========

Weighted average common shares outstanding . . . . . . . . . . . . . . . . . . 19,804 19,652
========= =========
</TABLE>

- ---------------
See Notes to Consolidated Financial Statements.

3
<PAGE> 5

IDEX CORPORATION AND SUBSIDIARIES
STATEMENT OF CONSOLIDATED SHAREHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
COMMON STOCK ACCUMULATED TOTAL
AND ADDITIONAL RETAINED TRANSLATION SHAREHOLDERS'
PAID-IN CAPITAL EARNINGS ADJUSTMENT EQUITY
------------------- ---------- ------------ -------------------
<S> <C> <C> <C> <C>
Balance:
December 31, 1995 . . . . . . . . $ 86,309 $ 67,729 $ (3,093) $ 150,945

Stock options exercised . . . . . . 859 859

Unrealized translation adjustment . 672 672

Cash dividends on common
stock ($.32 per share) . . . . . . (6,133) (6,133)

Net income . . . . . . . . . . . .
24,876 24,876
--------- --------- --------- ---------

Balance:
June 30, 1996 (unaudited) . . . . $ 87,168 $ 86,472 $ (2,421) $ 171,219
========= ========= ========= =========
</TABLE>

- ---------------
See Notes to Consolidated Financial Statements.

4
<PAGE> 6

IDEX CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
(IN THOUSANDS)

<TABLE>
<CAPTION>
For the Six Months Ended June 30, 1996 1995
---------- ----------
(UNAUDITED)
<S> <C> <C>
Cash Flows From Operating Activities:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 24,876 $ 23,081
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,865 5,681
Amortization of intangibles . . . . . . . . . . . . . . . . . . . . . . . 3,371 2,537
Amortization of debt issuance expenses . . . . . . . . . . . . . . . . . 312 312
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . 587 150
Increase in receivables . . . . . . . . . . . . . . . . . . . . . . . . . (202) (8,443)
(Increase) decrease in inventories . . . . . . . . . . . . . . . . . . . 7,188 (8,114)
Increase (decrease) in trade accounts payable . . . . . . . . . . . . . . (4,515) 1,386
Increase (decrease) in accrued expenses . . . . . . . . . . . . . . . . . (5,546) 2,016
Other transactions - net . . . . . . . . . . . . . . . . . . . . . . . . 957 274
-------- ---------
Net cash flows from operating activities . . . . . . . . . . . . . . . 33,893 18,880
-------- ---------
Cash Flows From Investing Activities:
Additions to property, plant and equipment . . . . . . . . . . . . . . . . . (6,405) (5,539)
Acquisition of business (net of cash required) . . . . . . . . . . . . . . . (32,905)
-------- ---------
Net cash flows from investing activities . . . . . . . . . . . . . . . . . (6,405) (38,444)
-------- ---------

Cash Flows From Financing Activities:
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6,125) (5,348)
Net borrowings (repayments) of long-term debt . . . . . . . . . . . . . . . . (20,138) 21,500
Decrease in accrued interest . . . . . . . . . . . . . . . . . . . . . . . . (396) (21)
-------- ---------
Net cash flows from financing activities . . . . . . . . . . . . . . . . (26,659) 16,131
-------- ---------

Net increase (decrease) in cash . . . . . . . . . . . . . . . . . . . . . . . . 829 (3,433)
Cash and cash equivalents at beginning of period . . . . . . . . . . . . . . . 5,937 6,288
-------- ---------
Cash and cash equivalents at end of period . . . . . . . . . . . . . . . . . . $ 6,766 $ 2,855
======== =========

Supplemental Disclosure of Cash Flow Information
------------------------------------------------

Cash paid during the period for:
Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 8,254 $ 7,192
Taxes (including foreign) . . . . . . . . . . . . . . . . . . . . . . . . . . 13,354 10,913
</TABLE>

- ---------------
See Notes to Consolidated Financial Statements.

5
<PAGE> 7

IDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Acquisition

Pursuant to the requirements of the Securities and Exchange Commission,
the January 22, 1988 acquisition of the initial six businesses comprising IDEX
Corporation ("IDEX" or the "Company") was not accounted for as a purchase
transaction. Consequently, the accounting for the acquisition does not reflect
any adjustment of the carrying value of the assets and liabilities to their
fair values at the time of the acquisition. Accordingly, the total
shareholders' equity of IDEX at June 30, 1996 and December 31, 1995 includes a
charge of $96.5 million which represents the excess of the purchase price over
the book value of the subsidiaries purchased at the date of the acquisition.

2. (a) Significant Accounting Policies

In the opinion of management, the unaudited information presented as of
June 30, 1996 and for the three and six months ended June 30, 1996 and 1995
reflects all adjustments necessary, which consist only of normal recurring
adjustments, for a fair presentation of the interim periods.

(b) Earnings Per Share

Earnings per share is computed by dividing net income by the weighted
average number of shares of common stock and common stock equivalents
outstanding during the period. Common stock equivalents, in the form of stock
options, have been included in the calculation of weighted average shares
outstanding using the treasury stock method.

3. Inventories

The components of inventories as of June 30, 1996 and December 31, 1995
were (000's omitted):

<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
------------ -------------
(unaudited)
<S> <C> <C>
Inventories
Raw materials and supplies $ 12,807 $ 13,978
Work in process 13,311 15,434
Finished goods 67,746 71,640
--------- ---------
Totals $ 93,864 $101,052
========= ========
</TABLE>

Those inventories which were carried on a LIFO basis amounted to $55,418
and $57,409 at June 30, 1996 and December 31, 1995, respectively. The excess
of current cost over LIFO inventory value and the impact on earnings of using
the LIFO method are not material.

4. Common and Preferred Stock

The Company had five million shares of preferred stock authorized but
unissued at June 30, 1996 and December 31, 1995.

5. Subsequent Events

On July 17, 1996, IDEX entered into a multi-currency Third Amended and
Restated Credit Agreement ("Amended U.S. Credit Agreement") increasing the
maximum availability to $250 million along with making certain adjustments to
the interest rate structure. The availability under the Amended U.S. Credit
Agreement declines in stages commencing July 1, 1999 to $200 million on July 1,
2000. Any amount outstanding at July 1, 2001 becomes due at that date.
Interest is payable quarterly on the outstanding balance at the bank agent's
reference rate, or at LIBOR plus an applicable margin.

On July 29, 1996, IDEX purchased certain assets and assumed certain
liabilities of Fluid Management L.P. for approximately $137 million. The
purchase price was financed through a borrowing of $135 million under the
Amended U.S. Credit Agreement and the issuance of 75,700 shares of IDEX Common
Stock.

6
<PAGE> 8

Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

Historical Overview and Outlook

IDEX sells a broad range of proprietary fluid handling and industrial
products to a diverse customer base in the U.S. and, to an increasing extent,
internationally. Accordingly, IDEX's businesses are affected by levels of
industrial activity and economic conditions in the U.S. and in other countries
where its products are sold and by the relationship of the dollar to other
currencies. Among the factors that affect the demand for IDEX's products are
interest rates, levels of capital spending in certain industries, and overall
industrial growth.

IDEX has a history of strong operating margins. The Company's operating
margins are affected by, among other things, utilization of facilities as sales
volumes change, and inclusion of newly acquired businesses which may have lower
margins that could be further affected by purchase accounting adjustments.

IDEX's orders, sales, net income and earnings per share in the second
quarter of 1996 were the highest of any second quarter in its history.
Business conditions have shown more modest growth this year than in the first
half of 1995. Incoming orders in the 1996 second quarter increased 6% over the
same quarter of 1995, which was IDEX's previous record second quarter. Sales
in the second quarter of 1996 increased 3% over the same quarter of last year,
as sales in the core businesses decreased 5%, while the inclusion of Micropump
(acquired May 1995) and Lukas (acquired October 1995) added 8% to the volume
increase. Shipments in the quarter outpaced incoming orders by $2.9 million,
and backlogs declined accordingly, but remain at IDEX's typical operating level
of about 1.4 months' sales. This low level of backlog allows IDEX to provide
excellent customer service, but also means that changes in orders are felt
quickly in operating results.

Clearly, growth in the U.S. and Europe is more sluggish this year than
last. Nevertheless, with the Company's strong market position, new product
emphasis, international presence, and the integration of recent acquisitions,
including the Fluid Management acquisition, IDEX's prospects are quite good.
The second quarter provided a difficult comparison with the prior year because
of IDEX's all-time record earnings in the three months ended June 30, 1995,
following a surge in orders across the company. Based on current conditions
and barring unforeseen circumstances, IDEX expects operating results in each of
the third and fourth quarters will improve from those of the same quarters last
year, and the Company will again set new records in sales, net income, and
earnings per share in 1996.

Cautionary Statement Under the Private Securities Litigation Reform Act

Demand for the company's products is cyclical in nature and subject to
changes in general market conditions that affect demand. The Company's
customers operate primarily in industries that are affected by changes in
economic conditions, which in turn can affect orders. The Company operates
without significant order backlogs. As a result, economic slowdowns could
quickly have an adverse effect on the Company's performance. In addition, the
Company's operating forecasts and budgets are based upon detailed assumptions,
which it believes are reasonable, but inherent difficulties in predicting the
impact of certain factors may cause actual results to differ materially from the
forward-looking statements set forth above. These factors include, but are not
limited to the following: The Company's utilization of its capacity and the
impact of capacity utilization on costs; developments with respect to
contingencies such as environmental matters and litigation; labor market
conditions and raw materials costs; levels of industrial activity and economic
conditions in the U.S. and other countries around the world and levels of
capital spending in certain industries, all of which have a material influence
on order rates: the relationship of the dollar to other currencies; interest
rates; the Company's ability to integrate and operate acquired businesses on a
profitable basis; and, other risks detailed from time to time in the Company's
filings with the Securities and Exchange Commission.

7
<PAGE> 9

COMPANY AND BUSINESS GROUP FINANCIAL INFORMATION
(000'S OMITTED)

<TABLE>
<CAPTION>
For the Second Quarter Ended June 30, 1996 1995
---------- ----------
(UNAUDITED)
<S> <C> <C>
Fluid Handling Group (1) . . . . . . . . . . . . . . . . . . . . . .
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 96,513 $ 91,426
Income from operations . . . . . . . . . . . . . . . . . . . . 20,580 19,761
Operating margin . . . . . . . . . . . . . . . . . . . . . . . 21.3% 21.6%
Depreciation and amortization . . . . . . . . . . . . . . . . . $ 4,179 $ 3,423
Capital expenditures . . . . . . . . . . . . . . . . . . . . . 2,468 2,258

Industrial Products Group (1)
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 34,712 $ 35,870
Income from operations . . . . . . . . . . . . . . . . . . . . 5,143 5,822
Operating margin . . . . . . . . . . . . . . . . . . . . . . . 14.8% 16.2%
Depreciation and amortization . . . . . . . . . . . . . . . . . 829 $ 722
Capital expenditures . . . . . . . . . . . . . . . . . . . . . $ 1,248 1,024

Company
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $131,169 $127,203
Income from operations . . . . . . . . . . . . . . . . . . . . 23,737 23,147
Operating margin . . . . . . . . . . . . . . . . . . . . . . . 18.1% 18.2%
Depreciation and amortization (2) . . . . . . . . . . . . . . . $ 5,046 $ 4,160
Capital expenditures . . . . . . . . . . . . . . . . . . . . . 3,716 3,283
</TABLE>

(1) Group income from operations excludes net unallocated corporate
operating expenses.

(2) Excludes amortization of debt issuance expenses.

8
<PAGE> 10

COMPANY AND BUSINESS GROUP FINANCIAL INFORMATION
(000'S OMITTED)

<TABLE>
<CAPTION>
For the Six Months Ended June 30, 1996 1995
---------- ----------

(UNAUDITED)
<S> <C> <C>
Fluid Handling Group (1) . . . . . . . . . . . . . . . . . . . . . .
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $193,130 $172,953
Income from operations . . . . . . . . . . . . . . . . . . . . 40,373 36,668
Operating margin . . . . . . . . . . . . . . . . . . . . . . . 20.9% 21.2%
Depreciation and amortization . . . . . . . . . . . . . . . . . $ 8,482 6,625
Capital expenditures . . . . . . . . . . . . . . . . . . . . . 3,798 3,599

Industrial Products Group (1)
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 72,040 $ 71,030
Income from operations . . . . . . . . . . . . . . . . . . . . 11,023 11,712
Operating margin . . . . . . . . . . . . . . . . . . . . . . . 15.3% 16.5%
Depreciation and amortization . . . . . . . . . . . . . . . . . $ 1,680 $ 1,563
Capital expenditures . . . . . . . . . . . . . . . . . . . . . 2,588 1,919

Company
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . $265,055 $243,783
Income from operations . . . . . . . . . . . . . . . . . . . . 47,153 43,621
Operating margin . . . . . . . . . . . . . . . . . . . . . . . 17.8% 17.9%
Depreciation and amortization (2) . . . . . . . . . . . . . . . $ 10,236 $ 8,218
Capital expenditures . . . . . . . . . . . . . . . . . . . . . 6,405 5,539
</TABLE>

(1) Group income from operations excludes net unallocated corporate operating
expenses.

(2) Excludes amortization of debt issuance expenses.

9
<PAGE> 11

Results of Operations

For purposes of this discussion and analysis section, reference is made to
the tables on the preceding pages 8 and 9 and the Company's Statements of
Consolidated Operations included in the Financial Statement section. IDEX
consists of two business segments: Fluid Handling and Industrial Products.

Performance in the Second Quarter Ended June 30, 1996 Compared to 1995

Sales in the second quarter of 1996 were $131.2 million, and increased by
3 percent over $127.2 million in the corresponding period of 1995.

Fluid Handling Group sales of $96.5 million in the three months ended June
30, 1996 increased by $5.1 million, or 6% over the same period in 1995, due to
the inclusion of recent acquisitions, Micropump (May, 1995) and Lukas (October,
1995). Sales outside the U.S. increased to 38% of total Fluid Handling Group
sales in the second quarter of 1996 from 33% in the comparable 1995 period due
to the inclusion of Lukas, based in Germany, and the U.K. - based operations of
Micropump.

Second quarter 1996 sales in the Industrial Products Group of $34.7
million decreased $1.2 million, or 3%, from the same quarter of last year due
to lower worldwide demand for higher-ticket capital goods, particularly metal
fabrication equipment. Shipments outside the U.S. were 39% of total sales in
the Industrial Products Group in the second quarter of 1996, down from 42% in
the comparable 1995 period.

Income from operations increased $.6 million or 3% to $23.7 million in the
three months ended June 30, 1996 from $23.1 million in 1995's second quarter.
Second quarter 1996 operating margins of 18.1% were just about the same as the
18.2% recorded in last year's record second quarter. In the Fluid Handling
Group, income from operations of $20.6 million and operating margin of 21.3% in
the three-month 1996 period compare to the $19.8 million and 21.6% recorded in
1995. The slight operating margin decline resulted from the inclusion of
recent acquisitions whose operating margins, as expected, were somewhat lower
than the other units in the Group and whose profits were further affected by
purchase accounting adjustments. Income from operations in the Industrial
Products Group of $5.1 million in the second quarter of 1996 declined $.7
million from the $5.8 million in 1995. Operating margin of 14.8% in the 1996
second quarter decreased from the 16.2% achieved in 1995 due primarily to
volume-related profit declines associated with lower sales of metal fabrication
equipment.

Interest expense increased to $4.1 million in the second quarter of 1996
from $3.9 million in the 1995 period because of additional borrowings under the
credit agreements for the acquisitions of Micropump and Lukas.

The provision for income taxes remained the same at $6.9 million in the
three months ended June 30, 1996 and 1995. The effective tax rate decreased to
35.3% in the 1996 period from 36.0% in the corresponding period of 1995.

Net income of $12.7 million in the second quarter of 1996 was 3% higher
than the net income of $12.3 million in same period of 1995. Record earnings
per share of 64 cents in this year's second quarter improved 2% from the 63
cents earned in the same quarter of last year, which was the previous all-time
high for any quarter in IDEX's history.

10
<PAGE> 12

Performance in the Six Months Ended June 30, 1996 Compared to 1995

In the six months ended June 30, 1996, IDEX had record sales of $265.1
million, up 9% from last year's previous record of $243.8 million. Overall
growth was dampened by those businesses that produce or sell to manufacturers
of higher-ticket capital goods. Specifically, Strippit, which produces metal
fabrication equipment; Vibratech, which serves the heavy-duty truck engine
market; and Lubriquip, which makes centralized lubrication systems for
machinery, have experienced sales declines this year. On an overall basis,
sales in the base businesses were essentially flat with last year, with
acquisitions accounting for the volume increases. International sales
accounted for 38% of the total in the 1996 first half, up from 35% last year.
Incoming orders in the first six months totaled $261.9 million, almost
equivalent to sales, and backlogs at June 30 were at a typical 1.4 months'
sales.

Fluid Handling Group sales of $193.1 million increased $20.2 million, or
12%, due to the inclusion of the recently acquired Micropump and Lukas
operations. Sales outside the U.S. increased to 38% of total Fluid Handling
Group sales in the first six months of 1996 from 32% in the comparable 1995
period due to the inclusion of Lukas, based in Germany, the U.K. - based
operations of Micropump, and stronger worldwide demand for products of the
Group's core businesses.

First half 1996 sales in the Industrial Products Group of $72.0 million
increased $1.0 million, or 1%, over the same period of last year due to higher
customer demand for banding and clamping devices and sign mounting systems,
offset by lower worldwide shipments of metal fabrication equipment. Shipments
outside the U.S. were 38% of total sales in the Industrial Products Group in
the six-month 1996 period, down slightly from 39% in the comparable 1995
period.

Income from operations increased $3.5 million or 8% to $47.2 million in
the six months ended June 30, 1996 from $43.6 million in 1995's first half.
Six-month 1996 operating margins of 17.8% were just about the same as the 17.9%
posted in last year's record first six months. In the Fluid Handling Group,
income from operations of $40.4 million and operating margin of 20.9 % in the
first six months of 1996 compare to the $36.7 million and 21.2% recorded in
1995. The slight operating margin decline resulted from the inclusion of
recent acquisitions whose operating margins, as expected, were somewhat lower
than the other units in the Group and whose profits were further affected by
purchase accounting adjustments. Income from operations in the Industrial
Products Group of $11.0 million in the six-month 1996 period was down $.7
million from the $11.7 million in 1995. Operating margin of 15.3% in the 1996
first half decreased from the 16.5% achieved in 1995 because of volume-related
profit declines at the Company's Strippit operations.

Interest expense increased to $8.3 million in the first half of 1996 from
$7.6 million in the 1995 period because of additional borrowings under the
credit agreements for the acquisitions of Micropump and Lukas.

The provision for income taxes increased to $13.9 million in the six
months ended June 30, 1996 from $13.0 million in the comparable 1995 period.
The effective tax rate decreased slightly to 35.9% in 1996 from 36.0% in 1995.

Record net income of $24.9 million in the first six months of 1996 was 8%
higher than the net income of $23.1 million in the same period of 1995.
Earnings per share amounted to $1.26 in 1996's first half, a new all-time high,
which was 8% higher than the $1.17 recorded in the year-ago period.

11
<PAGE> 13

Liquidity and Capital Resources

At June 30, 1996, IDEX's working capital was $107.4 million and its
current ratio was 2.5 to 1. Internally generated funds were adequate to fund
capital expenditures of $6.4 million and $5.5 million, and dividends on common
stock of $6.1 million and $5.3 million, for the six months ended June 30, 1996
and 1995, respectively. The capital expenditures were generally for machinery
and equipment which improved productivity, although a portion was for repair
and replacement of equipment and facilities. Management believes that IDEX has
ample capacity in its plant and equipment to meet expected needs for future
growth in the intermediate term. During the six months ended June 30, 1996 and
1995, depreciation and amortization expense, excluding amortization of debt
issuance expenses, was $10.2 million and $8.2 million, respectively.

At June 30, 1996, the maximum amount available under the U.S. Credit
Agreement was $150 million, of which $75 million was being used. On July 17,
1996, IDEX entered into an Amended U.S. Credit Agreement increasing the maximum
amount available to $250 million along with making certain adjustments to the
interest rate structure. The availability under the Amended U.S. Credit
Agreement declines in stages commencing July 1, 1999 to $200 million on July 1,
2000. Any amount outstanding at July 1, 2001 becomes due at that date.
Interest is payable quarterly on the outstanding balance at the bank agent's
reference rate, or at LIBOR plus an applicable margin. At June 30, 1996, that
applicable margin was 35 basis points. In addition, a facility fee is payable
quarterly on the entire $250 million available under the Amended U.S. Credit
Agreement. At June 30, 1996, the applicable facility fee percentage was 15
basis points.

The maximum amount available at June 30, 1996 under the Company's German
Credit Agreement was DM 52.5 million ($34.5 million), of which DM 50.0 million
($32.8 million) was being used. The availability under the Company's German
Credit Agreement declines in stages from DM 52.5 million to DM 31.3 million at
November 1, 2000. Any amount outstanding at November 1, 2001 becomes due at
that date. Interest is payable quarterly on the outstanding balance at LIBOR
plus 100 basis points.

IDEX believes it will generate sufficient cash flow from operations to
meet its operating requirements, interest and scheduled amortization payments
under both the Amended U.S. Credit Agreement and the German Credit Agreement,
interest and principal payments on the Senior Subordinated Notes, approximately
$14 million of planned capital expenditures and $12 million of annual dividend
payments to holders of common stock in 1996. From commencement of operations
in January 1988 until June 30, 1996, IDEX has borrowed $277 million under the
credit agreements to complete nine acquisitions. During this same period, IDEX
generated, principally from operations, cash flow of $259 million to reduce its
indebtedness. In the event that suitable businesses or assets are available
for acquisition by IDEX upon terms acceptable to the Board of Directors, IDEX
may obtain all or a portion of the financing for the acquisitions through the
incurrence of additional long-term indebtedness.

On July 29, 1996 IDEX acquired Fluid Management, a Wheeling,
Illinois-based manufacturer of color formulation equipment for paints,
coatings, inks and dyes for approximately $137 million. Fluid Management,
which also has operations in the Netherlands, Germany and Australia, is the
world's leading producer of this type of equipment, with annual sales of
approximately $90 million. The acquisition was accounted for using the
purchase method of accounting and was financed through a $135 million
borrowing under the Amended U.S. Credit Agreement and the issuance of 75,700
shares of IDEX common stock.

12
<PAGE> 14

PART II. OTHER INFORMATION

Item 1. Legal Proceedings. None.

Item 2. Changes in Securities. Not Applicable.

Item 3. Defaults upon Senior Securities. None.

Item 4. Submission of Matters to a Vote of Security Holders. None.

Item 5. Other Information.

On July 29, 1996, IDEX Corporation ("IDEX"), through its newly
formed subsidiary Fluid Management, Inc. ("FM"), a Delaware
Corporation, purchased certain assets and assumed certain
liabilities of Fluid Management Limited Partnership ("FMLP")
and certain related entities for approximately $137 million.
The purchase price, arrived at through arms-length
negotiations between IDEX and the partners of FMLP, is subject
to an adjustment equal to the difference between certain
targets provided in the contract and the amounts at closing.
The purchase price was financed through a $135 million
borrowing under IDEX's amended U.S. bank revolving credit
facility with Bank of America Illinois as agent for the
participating banks, and through the issuance of 75,700 shares
of IDEX common stock.

The assets acquired from FMLP include trade accounts
receivable, inventory, machinery and equipment comprising
substantially all of FMLP's assets used in its business of
manufacturing color formulation equipment for paints,
coatings, inks, colorants and dyes. IDEX intends to operate
the acquired assets in the same business in which FMLP
operated.

It is impracticable, at this time, to provide the required
financial statements and pro forma information for FM.
Therefore, the required financial statements and pro forma
information has not been included in this form 10-Q report.
The required financial statements and pro forma financial
information will be filed under cover of a report on Form 8K
within 60 days.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits

The exhibits listed in the accompanying "Exhibit Index" are
filed as part of this report.

(b) Reports on Form 8-K

There have been no reports on Form 8-K filed during the
quarter for which this report is filed.

<PAGE> 15

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized in the capacity and on the date
indicated.

IDEX CORPORATION

August 12, 1996 /s/Wayne P. Sayatovic
Wayne P. Sayatovic
Senior Vice President -
Finance, Chief Financial
Officer and Secretary
(Duly Authorized and Principal
Financial Officer)

14
<PAGE> 16

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
------- ----------- ----
<S> <C>
*2.1 Asset Purchase Agreement dated July 26, 1996 between IDEX and Fluid Management Limited Partnership, Fluid
Management U.S., L.L.C., Fluid Management Service, Inc., Fluid Management Canada, L.L.C., Fluid Management
France SNC, FM International, Inc., Fluid Management Europe B.V.

A copy of the omitted schedules will be furnished to the Commission upon request.

3.1 Restated Certificate of Incorporation of IDEX (formerly HI, Inc.) (incorporated by reference to
Exhibit No. 3.1 to the Registration Statement on Form S-1 of IDEX Corporation, et al.,
Registration No. 33-21205, as filed on April 21, 1988).

3.1(a) Amendment to Restated Certificate of Incorporation of IDEX (formerly HI, Inc.), as amended
(incorporated by reference to Exhibit No. 3.1(a) to the Quarterly Report of IDEX on Form 10-Q
for the quarter ended March 31, 1996, Commission File No. 1-10235).

3.2 Amended and Restated By-Laws of IDEX (incorporated by reference to Exhibit No. 3.2 to Post-
Effective Amendment No. 2 to the Registration Statement on Form S-1 of IDEX Corporation, et al.,
Registration No. 33-21205, as filed on July 17, 1989).

3.2(a) Amended and Restated Article III, Section 13 of the Amended and Restated By-Laws of IDEX
(incorporated by reference to Exhibit No. 3.2(a) to Post-Effective Amendment No. 3 to the
Registration Statement on Form S-1 of IDEX Corporation, et al., Registration No. 33-21205, as
filed on February 12, 1990).

4.1 Restated Certificate of Incorporation and By-Laws of IDEX (filed as Exhibits 3.1 through
3.2(a)).

4.2 Indenture, dated as of September 15, 1992, among IDEX, the Subsidiaries and The Connecticut
National Bank, as Trustee, relating to the 9-3/4% Senior Subordinated Notes of IDEX due 2002
(incorporated by reference to Exhibit No. 4.2 to the Annual Report of IDEX on Form 10-K for the
fiscal year ending December 31, 1992, Commission File No. 1-10235).

4.2(a) First Supplemental Indenture dated as of December 22, 1995 among IDEX and the Subsidiaries named
therein and Fleet National Bank of Connecticut (formerly known as The Connecticut National
Bank), a national banking association, as trustee (incorporated by reference to Exhibit No.
4.2(a) to the Annual Report of IDEX on Form 10-K for the fiscal year ending December 31, 1995,
Commission File No. 1-10235).

*4.2(b) Second Supplemental Indenture dated as of July 29, 1996 among IDEX and the Subsidiaries named therein
and Fleet National Bank (formerly known as Fleet National Bank Connecticut), a national banking
association, as trustee.

4.3 Specimen Senior Subordinated Note of IDEX (including specimen Guarantee) (incorporated by
reference to Exhibit No. 4.3 to the Annual Report of IDEX on Form 10-K for the fiscal year
ending December 31, 1992, Commission File No. 1-10235).

4.4 Specimen Certificate of Common Stock (incorporated by reference to Exhibit No. 4.3 to the
Registration Statement on Form S-2 of IDEX Corporation, et al., Registration No. 33-42208, as
filed on September 16, 1991).

*4.5 Third Amended and Restated Credit Agreement dated as of July 17, 1996 among IDEX, Bank of
America Illinois, as Agent, and other financial institutions named therein.
</TABLE>

15
<PAGE> 17

<TABLE>
<CAPTION>
Exhibit
Number Description Page
------- ----------- ----

<S> <C>
*4.6 Amended and Restated Pledge Agreement dated as of July 17, 1996 by IDEX in favor of the Agent and
Banks.

*4.6(a) Supplement No. 1 to the Amended and Restated Pledge Agreement dated as of August 5, 1996 by IDEX
in favor of the Agent and Banks.

*4.7 Amended and Restated Subsidiary Guaranty Agreement dated as of July 17, 1996 by the Subsidiaries
named therein in favor of the Agent and Banks.

*4.7(a) Supplement No. 1 to the Amended and Restated Subsidiary Guaranty Agreement dated as of August 5,
1996 by FMI Management Company in favor of the Agent and Banks.

*4.7(b) Supplement No. 2 to the Amended and Restated Subsidiary Guaranty Agreement dated as of August 5,
1996 by Fluid Management, Inc. in favor of the Agent and Banks.

*4.8 Registration Rights Agreement dated as of July 29, 1996 between IDEX and Mitchell H. Saranow.

</TABLE>

16
<PAGE> 18

<TABLE>
<CAPTION>
Exhibit
Number Description Page
------- ----------- ----
<S> <C>
**10.1 Amended and Restated Employment Agreement between IDEX and Donald N. Boyce, dated as of January
22, 1988 (incorporated by reference to Exhibit No. 10.15 to Amendment No. 1 to the Registration
Statement on Form S-1 of IDEX Corporation, Registration No. 33-28317, as filed on June 1, 1989).

**10.1(a) First Amendment to the Amended and Restated Employment Agreement between IDEX and Donald N.
Boyce, dated as of January 13, 1993 (incorporated by reference to Exhibit No. 10.5(a) to the
Annual Report of IDEX on Form 10-K for the fiscal year ending December 31, 1992, Commission File
No. 1-10235).

**10.1(b) Second Amendment to the Amended and Restated Employment Agreement between IDEX and Donald N.
Boyce, dated as of September 27, 1994 (incorporated by reference to Exhibit No. 10.5(b) to the
Annual Report of IDEX on Form 10-K for the fiscal year ending December 31, 1994, Commission File
No. 1-10235).

**10.2 Amended and Restated Employment Agreement between IDEX and Wayne P. Sayatovic, dated as of
January 22, 1988 (incorporated by reference to Exhibit No. 10.17 to Amendment No. 1 to the
Registration Statement on Form S-1 of IDEX Corporation, Registration No. 33-28317, as filed on
June 1, 1989).

**10.2(a) First Amendment to the Amended and Restated Employment Agreement between IDEX and Wayne P.
Sayatovic, dated as of January 13, 1993 (incorporated by reference to Exhibit No. 10.6(b) to the
Annual Report of IDEX on Form 10-K for the fiscal year ending December 31, 1994, commission File
No. 1-10235).

**10.3 Employment Agreement between IDEX and Frank J. Hansen dated as of August 1, 1994 (incorporated
by reference to Exhibit No.10.7 to the Quarterly Report of IDEX on Form 10-Q for the quarter
ended September 30, 1994, Commission File No. 1-10235).

**10.3(a) First Amendment to the Employment Agreement between IDEX and Frank J. Hansen, dated as of
September 27, 1994 (incorporated by reference to Exhibit No. 10.7(a) to the Annual Report of
IDEX on Form 10-K for the fiscal year ending December 31, 1994, Commission File No. 1-10235).
</TABLE>

<PAGE> 19

<TABLE>
<CAPTION>
Exhibit
Number Description Page
------- ----------- ----
<S> <C>
**10.4 Employment Agreement between IDEX and Jerry N. Derck, dated as of September 27, 1994
(incorporated by reference to Exhibit No. 10.8 to the Annual Report of IDEX on Form 10-K for the
fiscal year ending December 31, 1994, Commission File No. 1-10235).

**10.5 Management Incentive Compensation Plan (incorporated by reference to Exhibit No. 10.21 to
Amendment No. 1 to the Registration Statement on Form S-1 of IDEX Corporation, Registration No.
33-28317, as filed on June 1, 1989).

**10.5(a) Amended Management Incentive Compensation Plan (incorporated by reference to Exhibit No. 10.9(a)
to the Quarterly Report of IDEX on Form 10-Q for the quarter ended March 31, 1996, Commission
File No. 1-10235).

**10.6 Form of Indemnification Agreement (incorporated by reference to Exhibit No. 10.23 to the
Registration Statement on Form S-1 of IDEX Corporation, Registration No. 33-28317, as filed on
April 26, 1989).

**10.7 Form of Shareholder Purchase and Sale Agreement (incorporated by reference to Exhibit No. 10.24
to Amendment No. 1 to the Registration Statement on Form S-1 of IDEX Corporation, Registration
No. 33-28317, as filed on June 1, 1989).

**10.8 Revised Form of IDEX Stock Option Plan for Outside Directors (incorporated by reference to
Exhibit No. 10.22(a) to Post-Effective Amendment No. 4 to the Registration Statement on Form S-1
of IDEX Corporation, et al., Registration No. 33-21205, as filed on March 2, 1990).

**10.9 Amendment to the IDEX Stock Option Plan for Outside Directors, adopted by resolution of the
Board of Directors dated as of January 28, 1992 (incorporated by reference to Exhibit No.
10.21(a) of the Annual Report of IDEX on Form 10-K for the fiscal year ending December 31, 1992,
Commission File No. 1-102351).

**10.10 Non-Qualified Stock Option Plan for Non-Officer Key Employees of IDEX (incorporated by reference
to Exhibit No. 10.15 to the Annual Report of IDEX on Form 10-K for the fiscal year ending
December 31, 1992, Commission File No. 1-102351).

**10.11 Non-Qualified Stock Option Plan for Officers of IDEX (incorporated by reference to Exhibit No.
10.16 to the Annual Report of IDEX on Form 10-K for the fiscal year ending December 31, 1992,
Commission File No. 1-102351).

**10.12 IDEX Supplemental Executive Retirement Plan (incorporated by reference to Exhibit No. 10.17 to
the Annual Report of IDEX on Form 10-K for the fiscal year ending December 31, 1992, Commission
File No. 1-102351).

**10.13 1996 Stock Plan for Officers of IDEX (incorporated by reference to Exhibit No. 10.18 to the
Quarterly Report of IDEX Corporation on Form 10-Q for the Quarter ended March 31, 1996,
Commission File No. 1-10235).
</TABLE>

18
<PAGE> 20

<TABLE>
<CAPTION>
Exhibit
Number Description Page
------- ----------- ----
<S> <C>
10.14 Amended and Restated IDEX Directors Deferred Compensation Plan (incorporated by reference to
Exhibit No. 10.19 to the Quarterly Report of IDEX Corporation on Form 10-Q for the Quarter ended
March 31, 1996, Commission File No. 1-10235).

*27 Financial Data Schedule.
</TABLE>

Revolving Credit Facility, dated as of September 29, 1995,
between Dunja Verwaltungsgesellschaft mbH and Bank of America
NT & SA, Frankfurt Branch (a copy of the agreement will be
furnished to the Commission upon request).

- ---------------
*Filed herewith.
**Management contract or compensatory plan or arrangement.

<PAGE> 1
EXHIBIT 2.1

ASSET PURCHASE AGREEMENT

Dated July 26, 1996

Between

IDEX CORPORATION
(a Delaware corporation),

FLUID MANAGEMENT LIMITED PARTNERSHIP
(an Illinois limited partnership),

FLUID MANAGEMENT U.S., L.L.C
(a Illinois limited liability company),

FLUID MANAGEMENT SERVICE, INC.
(an Illinois corporation),

FLUID MANAGEMENT CANADA LLC
(an Illinois limited liability company),

FLUID MANAGEMENT FRANCE SNC
(a French partnership),

FM INTERNATIONAL, INC.
(an Illinois corporation)

and

FLUID MANAGEMENT EUROPE B.V.
(a Netherlands corporation)
<PAGE> 2

- i -

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----

ARTICLE 1
DEFINITIONS

<S> <C> <C>
1.1 Defined Terms . . . . . . . . . . . . . . . . . . . 2
1.2 Other Defined Terms . . . . . . . . . . . . . . . . 20
1.3 Terms Used in Other Purchase Agreements . . . . . . 21
1.4 Usage of Terms . . . . . . . . . . . . . . . . . . 21
1.5 References to Articles, Sections, Exhibits and
Schedules . . . . . . . . . . . . . . . . . . . . . 21
1.6 Currency Conversion Rates . . . . . . . . . . . . . 21

ARTICLE 2
PURCHASE AND SALE OF ASSETS OF SELLERS;
PURCHASE AND SALE OF FM-SERVICE SHARES,
FM-BRAZIL SHARES AND FM-GERMANY SHARES

2.1 Transfer of American Purchased Assets, FM-Service
Shares, FM-Brazil Shares and FM-Germany Shares . . 22
2.2 Assumption and Payment or Performance of American
Assumed Liabilities; Payment or Performance of
American Non-Assumed Liabilities and German
Non-Assumed Liabilities . . . . . . . . . . . . . . 22
2.3 Consideration; Allocation . . . . . . . . . . . . . 22
2.4 Closing Certificate; Preliminary Purchase Price
Closing Adjustment; Physical Inventory; Audit;
Closing Date Financial Report; Final Purchase
Price Closing Adjustment . . . . . . . . . . . . . 23
2.5 Payments by Buyer . . . . . . . . . . . . . . . . . 25
2.6 Taxes . . . . . . . . . . . . . . . . . . . . . . . 25

ARTICLE 3
CLOSING

3.1 Closing . . . . . . . . . . . . . . . . . . . . . . 26
3.2 Conveyances at Closing . . . . . . . . . . . . . . 26
3.3 Assumptions at Closing . . . . . . . . . . . . . . 27
3.4 Certificates and Other Documents . . . . . . . . . 27
3.5 Non-Transferable Assets . . . . . . . . . . . . . . 27
</TABLE>
<PAGE> 3

- ii -

ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF FMLP

<TABLE>
<S> <C>
4.1 Representations and Warranties With Respect To the
American Business . . . . . . . . . . . . . . . . . 28
4.2 Representations and Warranties With Respect To the
Dutch Business . . . . . . . . . . . . . . . . . . 28
4.3 Representations and Warranties With Respect To the
Australian Business . . . . . . . . . . . . . . . . 28
4.4 Representations and Warranties With Respect To the
German Business . . . . . . . . . . . . . . . . . . 28
4.5 Representations and Warranties With Respect To
Bethesda and the Wheeling Real Property . . . . . . 28
4.6 No Implied Representations and Warranties . . . . . 28

ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF BUYER

5.1 Organization and Good Standing . . . . . . . . . . 29
5.2 Authority; Authorization; Binding Effect . . . . . 29
5.3 No Conflict or Violation . . . . . . . . . . . . . 29
5.4 Consents and Approvals . . . . . . . . . . . . . . 30
5.5 No Proceedings . . . . . . . . . . . . . . . . . . 30
5.6 Financial Resources . . . . . . . . . . . . . . . . 30
5.7 No Brokers . . . . . . . . . . . . . . . . . . . . 30

ARTICLE 6
COVENANTS AND CONDUCT OF
THE PARTIES PRIOR TO CLOSING

6.1 Investigation by Buyer . . . . . . . . . . . . . . 30
6.2 Environmental Audits . . . . . . . . . . . . . . . 31
6.3 Notifications, Consents and Approvals . . . . . . . 31
6.4 Conduct Pending Closing . . . . . . . . . . . . . . 31
6.5 Notification of Certain Matters . . . . . . . . . . 32
6.6 Delivery of Interim Financial Statements . . . . . 33
6.7 Escrow Agreement . . . . . . . . . . . . . . . . . 34
6.8 Employment Agreement . . . . . . . . . . . . . . . 34
6.9 Non-Compete and Confidentiality Agreement . . . . . 34
6.10 Amendment of Management Agreement . . . . . . . . . 34
6.11 Offer of Employment to Sellers' Employees . . . . . 34
6.12 Assumption of Assumed Employee Benefit Plans . . . 34
6.13 Fees . . . . . . . . . . . . . . . . . . . . . . . 35
6.14 Elimination of Intercompany Payables . . . . . . . 35
6.15 Tail Coverage . . . . . . . . . . . . . . . . . . . 35
</TABLE>
<PAGE> 4

- iii -

<TABLE>
<S> <C>
6.16 Transfer of Interest in LLC . . . . . . . . . . . . 35
6.17 Conversion FM-Brazil and FM-Germany . . . . . . . . 35
6.18 Payment of Management Fees . . . . . . . . . . . . 36

ARTICLE 7
CONDITIONS TO SELLERS' OBLIGATIONS

7.1 Representations, Warranties and Covenants . . . . . 36
7.2 Required Consents and Filings . . . . . . . . . . . 36
7.3 No Proceedings . . . . . . . . . . . . . . . . . . 36
7.4 Closing Certificate . . . . . . . . . . . . . . . . 36
7.5 Legal Opinion . . . . . . . . . . . . . . . . . . . 36
7.6 Closing of Other Purchase Agreements and Merger
Agreement . . . . . . . . . . . . . . . . . . . . . 36

ARTICLE 8
CONDITIONS TO BUYER'S OBLIGATIONS

8.1 Representations, Warranties and Covenants . . . . . 37
8.2 Required Consents and Filings . . . . . . . . . . . 37
8.3 No Proceedings . . . . . . . . . . . . . . . . . . 37
8.4 No Interruption or Adverse Change . . . . . . . . . 37
8.5 Closing Certificate . . . . . . . . . . . . . . . . 37
8.6 Legal Opinions . . . . . . . . . . . . . . . . . . 38
8.7 Standard IDEX Agreements . . . . . . . . . . . . . 38
8.8 Certificates of Employees of Seller and The
Saranow Company . . . . . . . . . . . . . . . . . . 38
8.9 Closing of Other Purchase Agreements and Merger
Agreement . . . . . . . . . . . . . . . . . . . . . 38

ARTICLE 9
COVENANTS AND CONDUCT OF
THE PARTIES AFTER CLOSING

9.1 Survival and Indemnifications . . . . . . . . . . . 38
9.2 Use of Escrow Funds . . . . . . . . . . . . . . . . 44
9.3 Use of Partnership Name or Trade Name . . . . . . . 45
9.4 Continuation Health Care Coverage . . . . . . . . . 45
9.5 Access to Records and Personnel . . . . . . . . . . 46
9.6 Consolidated Gross Profit Adjustment . . . . . . . 46
9.7 Collection of Accounts Receivable . . . . . . . . . 48
9.8 Buyer's Contribution to FMLP's Profit Sharing
Plan . . . . . . . . . . . . . . . . . . . . . . . 50
9.9 Buyer's Continuation of FMLP's Bonus Plan . . . . . 50
9.10 Buyer's Obligation to Honor FMLP's Vacation
Benefits . . . . . . . . . . . . . . . . . . . . . 50
9.11 Product Liability After the Closing . . . . . . . . 50
9.12 Seller's Obligation to Remediate Contamination . . 50
</TABLE>
<PAGE> 5

- iv -

ARTICLE 10
MISCELLANEOUS

<TABLE>
<S> <C>
10.1 Further Assurances . . . . . . . . . . . . . . . . 51
10.2 Risk of Loss . . . . . . . . . . . . . . . . . . . 51
10.3 Termination . . . . . . . . . . . . . . . . . . . . 52
10.4 Notices . . . . . . . . . . . . . . . . . . . . . . 53
10.5 Knowledge . . . . . . . . . . . . . . . . . . . . . 55
10.6 Public Statements . . . . . . . . . . . . . . . . . 55
10.7 Choice of Law . . . . . . . . . . . . . . . . . . . 55
10.8 Expenses . . . . . . . . . . . . . . . . . . . . . 56
10.9 Titles . . . . . . . . . . . . . . . . . . . . . . 56
10.10 Waiver . . . . . . . . . . . . . . . . . . . . . . 56
10.11 Effective; Binding . . . . . . . . . . . . . . . . 56
10.12 Entire Agreement . . . . . . . . . . . . . . . . . 56
10.13 Modification . . . . . . . . . . . . . . . . . . . 57
10.14 Counterparts . . . . . . . . . . . . . . . . . . . 57
10.15 Consent to Jurisdiction . . . . . . . . . . . . . 57
</TABLE>
<PAGE> 6

- v -

SCHEDULES

<TABLE>
<CAPTION>
Schedule Description
-------- -----------
<S> <C>
1.1(g) American Non-Assumed Contracts
1.1(h) American Non-Assumed Employee
Benefit Plans
1.1(bq) German Non-Assumed Employee Benefit
Plans
1.1(bt) German Non-Assumed Contracts
2.3 Allocation of Purchase Price
4.1 Representations and Warranties with
Respect to the American Business
4.2 Representations and Warranties with
Respect to the Dutch Business
4.3 Representations and Warranties with
Respect to the Australian Business
4.4 Representations and Warranties with
Respect to the German Business
4.5 Representations and Warranties with
Respect to Bethesda and the Wheeling
Real Property
6.3 Required Consents and Filings
8.7 Individuals Executing Standards of
Conduct and Business Ethics Policy and
Employee Inventions and Confidentiality
Agreement

EXHIBITS
--------

Exhibit Description
------- -----------

6.7 Escrow Agreement
6.8 Saranow Employment Agreement
6.9 Non-Compete Agreement
6.10 Amended Management Agreement
7.5 Legal Opinion of Hodgson, Russ, Andrews,
Woods & Goodyear, LLP
8.6(a) Legal Opinion of McDermott, Will & Emery
8.6(b) Legal Opinion of Gould & Ratner
8.8 Employee Certificates

</TABLE>
<PAGE> 7

ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT dated July 26, 1996 is by and among IDEX
CORPORATION, a Delaware corporation with its principal place of business at 630
Dundee Road, Suite 400, Northbrook, Illinois 60062 ("IDEX" or "Buyer"), FLUID
MANAGEMENT LIMITED PARTNERSHIP, an Illinois limited partnership, with its
principal place of business at 1023 South Wheeling Road, Wheeling, Illinois
60090 ("FMLP"), FLUID MANAGEMENT U.S., L.L.C., an Illinois limited liability
company ("FMLLC"), FLUID MANAGEMENT SERVICE, INC., an Illinois corporation
("FM-Service"), FLUID MANAGEMENT CANADA LLC, an Illinois limited liability
company ("FM-Canada"), FLUID MANAGEMENT FRANCE SNC, a French partnership
("FM-France"), FM INTERNATIONAL INC., an Illinois corporation
("FM-International") and FLUID MANAGEMENT EUROPE B.V., a Netherlands
corporation ("FM-Europe"), .

RECITALS:

A. FMLP and its Subsidiaries (as hereinafter defined) are engaged in
the business of designing, manufacturing and distributing color formulation
equipment and equipment used for the mixing, storage, handling or dispensing of
paints, inks and other fluids, and providing services and products relating to
such business.

B. Buyer desires to purchase and accept from Sellers (as hereinafter
defined), and Sellers desire to sell and transfer to Buyer, substantially all
of the assets and liabilities of the American Business (as hereinafter
defined), including, without limitation, all of the issued and outstanding
capital stock of FM-Germany (as hereinafter defined), the entity which conducts
the German Business (as hereinafter defined), upon the terms and conditions
contained in this Agreement.

C. Contemporaneously with the execution and delivery of this
Agreement, Buyer and the Other Sellers (as hereinafter defined) are entering
into the Other Purchase Agreements (as hereinafter defined) pursuant to which
(1) Buyer has agreed to purchase from Bethesda (as hereinafter defined), and
Bethesda has agreed to sell to Buyer, the Wheeling Real Property (as
hereinafter defined) and (2) Buyer has agreed to purchase and accept from
FM-Holland (as hereinafter defined) and FM-Australia (as hereinafter defined),
and FM-Holland and FM-Australia have agreed to sell and transfer to Buyer,
substantially all of the assets and liabilities of the Dutch Business (as
hereinafter defined) and the Australian Business (as hereinafter defined),
respectively, upon the terms and conditions contained in the Other Purchase
Agreements.
<PAGE> 8

- 2 -

NOW, THEREFORE, in consideration of the mutual covenants and promises
contained in this Agreement, and for other good and valuable consideration, the
receipt and adequacy of which is hereby acknowledged, the parties agree as
follows:

ARTICLE 1
DEFINITIONS

1.1 Defined Terms. As used in this Agreement, the following terms
shall have the following meanings:

(a) "Accounts Receivable" shall mean all trade receivables and
accounts receivable of the Business (other than (A) accounts receivable between
any FMLP Operating Entity and Bethesda, FM-International or FM-Europe and (B)
Notes Receivable) as determined in accordance with GAAP (to the extent
reflected on the Closing Date Financial Report).

(b) "Accounts Payable" shall mean (i) all trade accounts payable of
the Business (other than accounts payable between any FMLP Operating Entity and
Bethesda, FM-International or FM-Europe) as determined in accordance with GAAP
(to the extent reflected on the Closing Date Financial Report) and (ii) all
checks written on any FMLP Operating Entity's "zero balance" or other bank
accounts on or prior to the Closing Date which have not cleared as of the
Closing Date.

(c) "Accrued Dutch Corporate Income Tax Liability" shall mean all
federal, state or local corporate income taxes owing by any FMLP Operating
Entity to any Governmental Authority in the Netherlands (but excluding any
Taxes imposed or arising in connection with the consummation of the
transactions contemplated by this Agreement and the Other Purchase Agreements)
attributable to the operation of the Business through the Closing Date that are
not yet due and payable as of the Closing Date, to the extent reflected on the
Closing Date Financial Report.

(d) "Accrued Liabilities" shall mean (i) accrued expenses of the
Business (other than Accounts Payable) of a type shown on the Interim Financial
Statements as of May 31, 1996 (other than (A) expenses between any FMLP
Operating Entity and Bethesda, FM-International or FM-Europe and (B) expenses
relating to any Non-Assumed Liabilities (including the current portion
thereof)), as determined in accordance with GAAP, (ii) accrued expenses under
the Assumed Employee Benefit Plans including (A) contributions to the Fluid
Management Limited Partnership Profit Sharing and Savings Plan in an amount
equal to seven percent (7%) of each eligible participant's compensation (as
defined in the plan) for the portion of the plan year through the Closing Date,
(B) payments under FMLP's bonus award program at the maximum bonus potential
for employees of the Dutch Business and at sixty-five (65) percent of the
maximum bonus potential for all other employees of the

<PAGE> 9
- 3 -

Business based on the results of operations through the Closing Date,
(C) covered medical expenses under The Saranow Companies Employee Health Care
Plan incurred through the Closing Date, (D) vacation benefits earned through
the Closing Date and (E) short term disability benefits incurred through the
Closing Date, (iii) accrued expenses for Australian long-service leave, annual
leave and sick leave, (iv) accrued expenses for real estate taxes through the
Closing Date on the basis of the latest available year's taxes with appropriate
adjustments for any reductions in taxes, (v) accrued expenses for the
contemplated roof and other repairs to the Wheeling Real Property disclosed on
the Disclosure Schedule to the extent not completed and paid for prior to
Closing, (vi) overdrafts on any bank account and reimbursement obligations
under any credit facility of any FMLP Operating Entity acquired by Buyer and
(vii) retrospective insurance premiums or charges on or with respect to any of
the Assumed Insurance (in each of items (i) through (vii), to the extent
reflected on the Closing Date Financial Report).

(e) "Affiliate" shall mean, as to any Person, any other Person which
directly or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (including,
with its correlative meanings, "controlled by" and "under common control with")
shall mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise).

(f) "Agreement" shall mean, unless the context otherwise requires,
this Asset Purchase Agreement together with the Schedules, Exhibits and the
Disclosure Schedule attached hereto, and the certificates and instruments to be
executed and delivered in connection herewith.

(g) "American Assumed Contracts" shall mean (i) the Material Contracts
of the FMLP Operating Entities conducting the American Business other than the
contracts identified on Schedule 1.1(g) (the "American Non-Assumed Contracts")
and (ii) the Minor Contracts of the FMLP Operating Entities conducting the
American Business, which shall be assumed by Buyer on the Closing Date.

(h) "American Assumed Employee Benefit Plans" shall mean the Employee
Benefit Plans of the FMLP Operating Entities conducting the American Business
other than the Employee Benefit Plans identified on Schedule 1.1(h) (the
"American Non-Assumed Employee Benefit Plans"), which shall be assumed by Buyer
on the Closing Date.

(i) "American Assumed Insurance" shall mean (i) the Insurance of the
FMLP Operating Entities conducting the American Business relating to the
American Assumed Employee Benefit Plans and (ii) all of the Insurance of
FM-Service, FM-Brazil and FM-France.
<PAGE> 10
- 4 -

(j) "American Assumed Liabilities" shall mean all liabilities and
obligations of every nature of the FMLP Operating Entities conducting the
American Business (other than the American Non-Assumed Liabilities), whether
absolute, accrued, contingent, known, unknown, matured, unmatured or otherwise,
and whether or not required to be disclosed or provided for in financial
statements in accordance with GAAP or pursuant to this Agreement, including all
liabilities and obligations relating to the American Assumed Contracts and the
American Assumed Employee Benefit Plans.

(k) "American Business" shall mean the Business as conducted by FMLP,
FMLLC, FM-Service, FM-Brazil, FM-Canada and FM-France.

(l) "American Excluded Assets" shall mean the following
assets of Sellers:

(i) cash and cash equivalents, except for the Purchased Cash;

(ii) bank accounts except for any Seller's payroll accounts and
petty cash accounts;

(iii) any Notes Receivable (including interest thereon) from
Joseph Rygiel and Leendert Hellenberg (including, without
limitation, the $100,000 mortgage note from Joseph Rygiel);

(iv) the partnership or other equity interests of FMLP in
FM-France, FM-Canada, FMLLC, FM-Holland, FM-Australia and
Fluid Management Systems, B.V.;

(v) any intercompany claims or receivables between any FMLP
Operating Entity and Bethesda, FM-International or
FM-Europe;

(vi) any rights of any Seller under this Agreement;

(vii) any currency and interest rate hedging agreements;

(viii) any rights of any FMLP Operating Entity against its
partners or shareholders;

(ix) the corporate or partnership books and records of any
Seller;

(x) any rights to tax refunds (except to the extent accrued on
the Closing Date Financial Report) and tax records of any
Seller;
<PAGE> 11

- 5 -

(xi) any Insurance (other than the American Assumed Insurance)
of any Seller;

(xii) any rights specifically relating to American Non-Assumed
Contracts or American Non-Assumed Liabilities; and

(xiii) any prepaid expenses for (A) Insurance (other than the
American Assumed Insurance) and (B) rent for the Wheeling
Real Property.

(m) "American Non-Assumed Liabilities" shall mean any liability or
obligation for, or Losses relating to, (i) any federal, state, local or foreign
income, franchise or other similar taxes (excluding sales and excise taxes)
based on income (whether net, gross receipts or otherwise) of any FMLP
Operating Entity conducting the American Business, (ii) any accounting fees for
year-end audit of any FMLP Operating Entity conducting the American Business,
(iii) any legal, accounting and other expenses incurred by any FMLP Operating
Entity conducting the American Business in connection with the preparation and
execution of this Agreement and the Other Purchase Agreements, and the
consummation of the transactions contemplated by this Agreement and the Other
Purchase Agreements, (iv) the Phantom Equity Plan, (v) any indebtedness between
any FMLP Operating Entity and Bethesda, FM-International or FM-Europe, (vi) any
indebtedness (including interest thereon) or guaranties of indebtedness of any
FMLP Operating Entity conducting the American Business to any Person for
borrowed money (including the Funded Debt but excluding leases not capitalized
under GAAP), (vii) any Insured Liabilities of any FMLP Operating Entity
conducting the American Business, (viii) the American Non-Assumed Contracts,
(ix) the American Non-Assumed Employee Benefit Plans, (x) any contamination
with trichloroethylene and its breakdown products (collectively, "TCE") of the
soil or groundwater at the Wheeling Real Property identified by
Conestoga-Rovers & Associates in their reports on or prior to the date of this
Agreement; provided, however, that such contamination shall constitute an
American Non-Assumed Liability only to the extent of FMLP's obligations under
Section 9.12 of this Agreement (the "TCE Liability"), (xi) any retrospective
insurance premiums or charges on or with respect to any of the Insurance (other
than the American Assumed Insurance) and (xii) any obligations of any FMLP
Operating Entity to its partners or shareholders in those capacities.

(n) "American Purchased Assets" shall mean all right, title and
interest of Sellers in and to all of the assets of Sellers relating to the
American Business of whatsoever nature, tangible or intangible, real or
personal including, without limitation, the following (except to the extent an
American Excluded Asset):

(i) the Accounts Receivable;
(ii) the American Assumed Contracts;
<PAGE> 12
- 6 -

(iii) the American Assumed Insurance;
(iv) the American Assumed Employee Benefit Plans;
(v) the Business Records;
(vi) the Customer Lists;
(vii) the Goodwill;
(viii) the Inventory;
(ix) the Notes Receivable;
(x) the Other Current Assets;
(xi) the Owned Intellectual Property;
(xii) the Owned Tangible Personal Property;
(xiii) the Permits (to the extent assignable); and
(xiv) the Purchased Cash.

(o) "American Purchase Price" shall mean the purchase price for the
American Purchased Assets, the FM-Service Shares and the FM-Brazil Shares and
shall be equal to the sum of (i) $72,750,000 and (ii) the Accrued Dutch
Corporate Income Tax Liability, as increased or decreased by the Purchase Price
Closing Adjustment and as decreased by the Consolidated Gross Profit
Adjustment, if any.

(p) "Assumed Employee Benefit Plans" shall mean the American Assumed
Employee Benefit Plans, the Dutch Assumed Employee Benefit Plans, the
Australian Assumed Employee Benefit Plans and the German Assumed Employee
Benefit Plans.

(q) "Assumed Insurance" shall mean the American Assumed Insurance, the
Dutch Assumed Insurance, the Australian Assumed Insurance and the German
Assumed Insurance.

(r) "Assumed Liabilities" shall mean the American Assumed Liabilities,
the Dutch Assumed Liabilities, the Australian Assumed Liabilities, the German
Assumed Liabilities and the Bethesda Assumed Liabilities.

(s) "Australian Business" shall mean the Business as conducted by
FM-Australia.

(t) "Bethesda" shall mean Bethesda Investors Limited Partnership, an
Illinois limited partnership.

(u) "Business" shall mean all activities which FMLP and its
Subsidiaries are presently conducting or pursuing, including, without
limitation, the design, manufacture and distribution of color formulation
equipment and equipment used for the mixing, storage, handling or dispensing of
paints, inks and other fluids, and the provision of services and products
relating thereto. For purposes of calculating Consolidated Working Capital,

<PAGE> 13

-7-

Consolidated Tangible Personal Property Gross Book Value and Consolidated
Gross Profit, "Business" shall mean the business of FMLP and its Subsidiaries,
on a consolidated basis, which is being acquired by Buyer pursuant to this
Agreement and the Foreign Asset Purchase Agreements.

(v) "Business Records" shall mean originals or true copies of all
operating data and records of the Business including, without limitation,
financial, accounting and bookkeeping books and records, purchase and sale
orders and invoices, sales and sales promotional data, advertising materials,
marketing analyses, past and present price lists, past and present customer
service files, credit files, warranty files, batch and product serial number
records and files, written operating methods and procedures, specifications,
operating records and other information related to the Tangible Personal
Property and the Current Real Property, reference catalogues, insurance files,
personnel records, records relating to potential acquisitions and other
records, on whatever media, pertaining to the Business, or to customers or
suppliers of, or any other parties having contracts or other business
relationships with, the Business.

(w) "Buyer's Accountants" shall mean those accountants at the firm of
Deloitte & Touche LLP who from time to time provide accounting services to
Buyer.

(x) "Claims Period" shall mean the period beginning on the Closing
Date and ending fifteen (15) months following the Closing Date.

(y) "Closing Date" shall mean the later to occur of (i) July 29, 1996
and (ii) five (5) days after all consents, approvals and other actions required
to be obtained from or performed by any third party as a condition to Closing
have been obtained, performed or waived, or if such day is not a business day,
the next succeeding business day, or any other date as FMLP and Buyer shall
mutually agree in writing.

(z) "Closing Date Consolidated Tangible Personal Property Gross Book
Value" shall mean the Consolidated Tangible Personal Property Gross Book Value
as of the Closing Date.

(aa) "Closing Date Consolidated Working Capital" shall mean the
Consolidated Working Capital as of the Closing Date.

(ab) "COBRA" shall mean the provisions of Part 6 of Subtitle B of Title
I of ERISA and Section 4980B of the Code and all regulations thereunder.

(ac) "Code" shall mean the Internal Revenue Code of 1986, as amended.
<PAGE> 14

-8-

(ad) "Consolidated Gross Profit" shall mean the gross profit of the
Business for calendar year 1996, determined in accordance with Section 9.6 and
otherwise in accordance with GAAP.

(ae) "Consolidated Gross Profit Adjustment" shall mean $35,500,000
minus the Consolidated Gross Profit; provided, however, that in no event shall
the Consolidated Gross Profit Adjustment be less than Zero Dollars ($0.00).

(af) "Consolidated Tangible Personal Property Gross Book Value" shall
mean the book value (before allowance for depreciation and amortization) of the
Owned Tangible Personal Property, determined in accordance with GAAP.

(ag) "Consolidated Tangible Personal Property Gross Book Value
Adjustment" shall mean, whether positive or negative, the Closing Date
Consolidated Tangible Personal Property Gross Book Value minus $14,400,000.

(ah) "Consolidated Working Capital" shall mean (i) the sum of (A) the
Accounts Receivable (without reduction for any reserves), (B) the Inventory,
(C) the Other Current Assets and (D) the Purchased Cash minus (ii) the sum of
(A) the Accounts Payable, (B) the Accrued Liabilities and (C) the Accrued Dutch
Corporate Income Tax Liability.

(ai) "Consolidated Working Capital Adjustment" shall mean, whether
positive or negative, the Closing Date Consolidated Working Capital minus
$18,900,000.

(aj) "Current Real Property" shall mean all Real Property currently
owned or leased by any FMLP Operating Entity or in which any FMLP Operating
Entity has any interest.

(ak) "Customer Lists" shall mean all past and current customer and
potential customer lists of the Business.

(al) "Disclosure Schedule" shall mean the Disclosure Schedule delivered
by FMLP on behalf of the FMLP Operating Entities and Bethesda simultaneously
with the execution of this Agreement, which shall be arranged in paragraphs
corresponding to the lettered and numbered paragraphs contained in Article 4
and the Schedules thereto.

(am) "Dutch Business" shall mean the Business as conducted by
FM-Holland, FM-Spain, FM-Sweden and FM-U.K.

(an) "Employee Benefit Plan" shall mean any (i) non qualified deferred
compensation or retirement plan or arrangement which is an Employee Pension
Benefit Plan,
<PAGE> 15

-9-

(ii) qualified defined contribution retirement plan or arrangement which
is an Employee Pension Benefit Plan, (iii) qualified defined benefit
retirement plan or arrangement which is an Employee Pension Benefit Plan
(including any Multiemployer Plan) or (iv) Employee Welfare Benefit Plan or
fringe benefit plan or program, any of which is maintained, administered or
contributed to by any FMLP Operating Entity, or which covers any employee or
former employee of any FMLP Operating Entity by reason of such Employee's
employment by any FMLP Operating Entity. The term "Employee Benefit Plan"
shall not include the Fluid Management Limited Partnership Phantom Equity Plan
(the "Phantom Equity Plan").

(ao) "Employee Pension Benefit Plan" shall have the meaning set forth
in ERISA Section 3(2).

(ap) "Employee Welfare Benefit Plan" shall have the meaning set forth
in ERISA Section 3(1).

(aq) "Encumbrance" shall mean any claim, lien, pledge, option, charge,
easement, security interest, right-of-way, encroachment, reservation,
restriction, encumbrance, or other right of any Person, or any other
restriction or limitation of any nature whatsoever, affecting title to the
Current Real Property, the Tangible Personal Property, the Inventory, the
Intellectual Property or any other assets of any FMLP Operating Entity.

(ar) "Enforceability Limitations" shall mean (i) bankruptcy,
insolvency, reorganization, moratorium or similar laws now or hereafter in
effect relating to creditors' rights and (ii) the discretion of the appropriate
court with respect to specific performance, injunctive relief or other terms of
equitable remedies.

(as) "Environmental Claims" shall mean any written notice of violation,
written notice of potential or actual responsibility or liability, or written
claim, suit, action, demand, directive or order by any Governmental Authority
or other Person for any damage (including, but not limited to, personal injury,
tangible or intangible property damage, contribution, indemnity, damage to the
environment, environmental removal, investigative costs, response or
remediation costs, nuisance, pollution, contamination or other adverse effects
on the environment or for fines, penalties or restrictions on existing
environmental permits or licenses) resulting from or relating to (i) the
presence of, a Release or threatened Release into the environment of, or
exposure to, any Hazardous Substance, (ii) the generation, manufacture,
processing, distribution, use, handling, transportation, storage, treatment or
disposal of any Hazardous Substances, (iii) the violation, or alleged
violation, of any Environmental Laws or (iv) the non-compliance or alleged
non-compliance with any Environmental Laws.

<PAGE> 16

-10-

(at) "Environmental Laws" shall mean any applicable statutes,
ordinances, directives or other written, published laws, any written, published
rules or regulations, orders, and any licenses, permits, orders, judgments,
notices or other requirements issued pursuant thereto, enacted, promulgated or
issued by any Governmental Authority, in effect as of the Closing Date,
relating to pollution or protection of public health or the environment from
Hazardous Substances (including, but not limited to, any air, surface water,
groundwater, land surface or sub-surface strata, whether outside, inside or
under any structure), or to the identification, reporting, generation,
manufacture, processing, distribution, use, handling, treatment, storage,
disposal, transporting, presence, Release or threatened Release of, any
Hazardous Substances. Without limiting the generality of the foregoing,
Environmental Laws shall include the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, the Toxic Substances
Control Act, as amended, the Hazardous Materials Transportation Act, as
amended, the Resource Conservation and Recovery Act, as amended, the Clean
Water Act, as amended, the Safe Drinking Water Act, as amended, the Clean Air
Act, as amended, and all analogous laws enacted, promulgated or lawfully issued
by any Governmental Authority, but shall exclude the Occupational Safety and
Health Act, as amended, and similar state laws.

(au) "Environmental Representations" shall mean those representations
and warranties of FMLP with respect to environmental matters contained in
paragraph (y) of each of Schedules 4.1, 4.2, 4.3 and 4.4 and in paragraph (k)
of Schedule 4.5.

(av) "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.

(aw) "ERISA Affiliate" shall mean a trade or business, whether or not
incorporated, which is deemed to be in common control or affiliated with any
FMLP Operating Entity within the meaning of Section 4001 of ERISA or Sections
414(b), (c), (m), or (o) of the Code.

(ax) "Escrow Agent" shall mean Bank of America Illinois.

(ay) "Escrow Funds" shall mean the amount of funds on deposit with and
held by the Escrow Agent from time to time pursuant to this Agreement and the
Escrow Agreement.

(az) "Excluded Assets" shall mean the American Excluded Assets, the
Dutch Excluded Assets and the Australian Excluded Assets.

(ba) "Financial Statements" shall mean the audited consolidated
financial statements of FMLP and its Subsidiaries for the three-year period
ended December 31, 1995 (consisting of a balance sheet, a statement of income
and retained earnings, a statement of
<PAGE> 17

-11-

cash flows, a consolidating schedule and all related footnotes),
reported on by the Sellers' Accountants without qualification.

(bb) "FMLP Operating Entities" shall mean the following
entities:

(i) FMLP;
(ii) FMLLC;
(iii) FM-Service;
(iv) FM-Brazil;
(v) FM-Canada;
(vi) FM-France;
(vii) FM-Holland;
(viii) FM-U.K.;
(ix) FM-Spain;
(x) FM-Sweden;
(xi) FM-Australia; and
(xii) FM-Germany.

(bc) "FM-Australia" shall mean Fluid Management Australia
L.P., an Australian limited partnership.

(bd) "FM-Brazil" shall mean Fluid Management Servicos E
Vendas Limitada, a Brazilian corporation.

(be) "FM-Brazil Shares" shall mean all of the issued and
outstanding capital stock of FM-Brazil.

(bf) "FM-Germany" shall mean Fluid Management GmbH, a
German corporation.

(bg) "FM-Germany Shares" shall mean all of the issued and
outstanding capital stock of FM-Germany.

(bh) "FM-Holland" shall mean Fluid Management Europe C.V.,
a Netherlands limited partnership.

(bi) "FM-Service Shares" shall mean all of the issued and
outstanding capital stock of FM-Service.

(bj) "FM-Spain" shall mean Fluid Management Espana SLU, a
Spanish corporation.
<PAGE> 18

-12-

(bk) "FM-Sweden" shall mean Fluid Management Scandinavia
AB, a Swedish corporation.

(bl) "FM-U.K." shall mean Fluid Management U.K. Ltd., a
U.K. corporation.

(bm) "Foreign Asset Purchase Agreements" shall mean (i) the
Asset Purchase Agreement dated the date of this Agreement between
Buyer, FM Acquisition Company Australia Pty Ltd. (a wholly-owned
subsidiary of Buyer), FM-Australia and FMLP (the "Australian Purchase
Agreement") and (ii) the Asset Purchase Agreement dated the date of
this Agreement between Buyer, FM-Holland, FM-Europe and FMLP (the
"Dutch Purchase Agreement").

(bn) "Funded Debt" shall mean indebtedness of any FMLP
Operating Entity or Bethesda (to the extent an Encumbrance on the
Wheeling Real Property) to any Person for borrowed money (including,
without limitation, indebtedness under leases capitalized under
GAAP).

(bo) "GAAP" shall mean, with respect to all accounting
matters and issues, generally accepted accounting principles as in
effect from time to time in the United States applied consistent with
the Financial Statements.

(bp) "General Partners" shall mean (i) Fluid Management
Inc. and (ii) Addison Paint Equipment Corp.

(bq) "German Assumed Employee Benefit Plans" shall mean the
Employee Benefit Plans of FM-Germany other than the Employee Benefit
Plans identified on Schedule 1.1(bq) (the "German Non-Assumed
Employee Benefit Plans").

(br) "German Assumed Insurance" shall mean all of the
Insurance of FM-Germany.

(bs) "German Business" shall mean the Business as conducted
by FM-Germany.

(bt) "German Non-Assumed Contracts" shall mean the Material
Contracts of FM-Germany identified on Schedule 1.1(bt).

(bu) "German Non-Assumed Liabilities" shall mean Losses
relating to (i) any federal, state, local or foreign income,
franchise or other similar taxes (excluding sales and excise taxes)
of FM-Germany, (ii) accounting fees for year-end audit of FM-Germany,
(iii) legal, accounting and other expenses incurred by FM-Germany in
<PAGE> 19

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connection with the preparation and execution of this Agreement and
the consummation of the transactions contemplated by this Agreement,
(iv) any indebtedness of FM-Germany to Bethesda, FM-International or
FM-Europe, (v) any indebtedness (including interest thereon) or
guaranties of indebtedness of FM-Germany to any Person for borrowed
money (including the Funded Debt but excluding leases not capitalized
under GAAP, (vi) the German Non-Assumed Contracts and (vii) the
German Non-Assumed Employee Benefit Plans.

(bv) "German Purchase Price" shall mean the purchase price
for the FM-Germany Shares, and shall be equal to $1,500,000.

(bw) "Goodwill" shall mean the goodwill of the Business.

(bx) "Governmental Authority" shall mean any federal,
state, local or foreign government, or any political subdivision of
any of the foregoing, or any court, agency or other entity, body,
organization or group, exercising any executive, legislative,
judicial, quasi-judicial, regulatory or administrative function of
government.

(by) "Governmental Requirement" shall mean any published
law, statute, ordinance, directive or regulation of any Governmental
Authority now in effect.

(bz) "Hazardous Substances" shall mean any pollutants,
contaminants, hazardous substances, hazardous and toxic chemicals,
carcinogens, wastes, dangerous wastes, and any ignitable, corrosive,
reactive, toxic or other hazardous substances or materials, whether
solids, liquids or gases (including, but not limited to, petroleum
and its derivatives, PCBs, asbestos, radioactive materials, waste
waters, sludge, slag and any other substance, material or waste), as
defined in or regulated by any Environmental Laws or as determined by
any Governmental Authority.

(ca) "HSR Act" shall mean the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended from time to time.

(cb) "Independent Accountants" shall mean Coopers & Lybrand
LLP.

(cc) "Initial Escrow Deposit" shall mean $10,000,000.

(cd) "Insurance" shall mean any fire, product liability,
automobile liability, general liability, worker's compensation,
medical insurance stop-loss coverage or other form
of insurance of the Business, and any tail coverage purchased with
respect thereto.

(ce) "Insured Liabilities" shall mean any liabilities or
obligations arising out of or relating to occurrences prior to the
Closing Date subject to coverage and to the extent covered under the
Insurance (other than the Assumed Insurance) or under any other
insurance
<PAGE> 20

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policy of any FMLP Operating Entity which has been terminated but
which provides coverage for occurrences prior to the date of its
termination.

(cf) "Intellectual Property" shall mean all intellectual
property used to conduct the Business including, without limitation,
(i) all inventions (whether patentable or unpatentable and whether or
not reduced to practice), all improvements thereto, and all patents,
patent applications, and patent disclosures, together with all
reissuances, continuations, continuations-in-part, revisions,
extensions, and re-examinations thereof, (ii) all trademarks, service
marks, trade dress, logos, trade names, and corporate names
(including, without limitation, the name "Fluid Management"),
together with all translations, adaptations, derivations, and
combinations thereof and including all goodwill associated therewith,
and all applications, registrations, and renewals in connection
therewith, (iii) all copyrightable works, all copyrights, and all
applications, registrations and renewals in connection therewith,
(iv) all mask works and all applications, registrations, and renewals
in connection therewith, (v) all trade secrets and confidential
business information (including ideas, research and development,
know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings,
specifications, customer and supplier lists, pricing and cost
information, and business and marketing plans and proposals), (vi)
all computer software (including data and related documentation and
including software installed on hard disk drives) and (vii) all
copies and tangible embodiments of any of the foregoing (in whatever
form or medium).

(cg) "Interim Financial Statements" shall mean the
unaudited consolidated monthly interim financial statements of FMLP
and its Subsidiaries (consisting of a balance sheet and a statement
of income, profit and loss) for the five (5) month period ended May
31, 1996, as delivered to Buyer, and for any subsequent period as may
be delivered to Buyer pursuant to Section 6.6.

(ch) "Inventory" shall mean all raw material,
work-in-process and finished goods inventory of the Business. Solely
for purposes of calculating Consolidated Working Capital, "Inventory"
shall mean the Inventory of the Business before reduction for
reserves which is not damaged or obsolete (as determined in
accordance with GAAP) or excess (as hereinafter defined), as
reflected on the Closing Date Financial Report. Inventory shall be
deemed to be "excess" if and only to the extent that (i) it has not
already been excluded as damaged or obsolete and (ii) as of the
Closing Date the total amount of any item of Inventory exceeds the
aggregate usage of such item for the twelve-month period immediately
preceding the Closing Date determined with reference to sales
records of the FMLP Operating Entities for such period, except that
any item of Inventory which relates to products introduced by any
FMLP Operating Entity within the twenty-four month period immediately
preceding the Closing Date (including any products introduced as a
result of acquisitions) and any Colorine Inventory shall be deemed
to be "excess" only if, as of the Closing Date, the total amount of
any such item of Inventory exceeds the aggregate expected usage of
such item, as forecasted
<PAGE> 21

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in good faith by FMLP, for the twelve-month period immediately
following the Closing Date.

(ci) "Limited Partners" shall mean (i) MPE Partners, (ii)
FMS Investment Partnership, (iii) Benn & Hamman Partnership, (iv)
William Wolf and (v) Joseph Rygiel and (vi) Leendert Hellenberg.

(cj) "Loss" shall mean any and all loss, liability,
deficiency, damage (excluding (i) other than with respect to
Environmental Claims, consequential damages which were not reasonably
foreseeable and (ii) other than as asserted in any third-party claim,
punitive damages), Encumbrance (other than any Permitted
Encumbrance), fine, claim, cost or expense (including, but not
limited to, any court cost or any legal or accounting fee or
disbursement).

(ck) "Material Contracts" shall mean the following written
contracts and, to the knowledge of FMLP, oral contracts which are
currently in effect and to which any FMLP Operating Entity is a party
or by which any FMLP Operating Entity is bound relating to or
affecting the Business:

(i) any agreement (or group of related agreements
with the same Person or its Affiliates) for the lease of real
property or personal property (whether or not capitalized under GAAP)
providing for lease payments in excess of $50,000 per year,

(ii) any agreement (or group of related agreements
with the same Person or its Affiliates) not cancelable by any FMLP
Operating Entity without penalty for the purchase or sale of raw
materials, commodities, supplies, products or other personal
property, or for the furnishing or receipt of services, the
performance of which will extend over a period of more than one (1)
year, involves consideration in excess of $50,000 or is anticipated
to result in a loss to any FMLP Operating Entity exceeding $10,000,

(iii) any agreement concerning any FMLP Operating
Entity's membership in a partnership or joint venture,

(iv) any agreement (or group of related agreements
with the same Person or its Affiliates) under which any FMLP
Operating Entity has created, incurred, assumed, or guaranteed (A)
any indebtedness for borrowed money (other than guarantees by any
FMLP Operating Entity not being acquired by Buyer of the indebtedness
of any other FMLP Operating Entity) or (B) any indebtedness or other
deferred or continuing payment obligation relating to any prior
acquisition by any FMLP Operating Entity (including, without
limitation, under any non-competition or consulting agreement),
<PAGE> 22

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(v) any agreement under which any FMLP Operating
Entity has imposed an Encumbrance on any of its assets;

(vi) any letter of credit or performance bond (other
than those specifically related to the Non-Assumed Liabilities),

(vii) any confidentiality or non-competition
agreement, other than confidentiality agreements with any FMLP
Operating Entity's employees, agents, distributors and independent
contractors, and non-disclosure agreements with other Persons entered
into in the ordinary course of the Business,

(viii) any agreement with any Affiliate of any FMLP
Operating Entity (but excluding agreements otherwise constituting
Material Contracts which are (A) between or among any FMLP Operating
Entities whose stock is not being acquired by Buyer or (B) between
FMLP and Bethesda) which are not on an arm's length basis and which
could not be readily obtained from other sources,

(ix) any profit sharing, deferred compensation,
severance or other plan or arrangement for the benefit of any FMLP
Operating Entity's current or former partners, shareholders,
directors, officers or employees (other than any Employee Benefit
Plans or agreements described in clause (xi)),

(x) any collective bargaining agreement,

(xi) any agreement not terminable at will or upon
thirty (30) days notice by any FMLP Operating Entity without penalty
(other than severance obligations) for the employment of any
individual on a full-time, part-time, consulting or other basis,

(xii) any agreement or instruments reflecting
outstanding loans or advances from any FMLP Operating Entity to such
FMLP Operating Entity's directors, officers or employees, other than
travel expenses advanced to any officer or employee of any FMLP
Operating Entity in the ordinary course of the Business and in an
amount which does not exceed $2,000 for any such officer or employee,

(xiii) any agreement for the prospective
acquisition of the business or product line of any other Person,

(xiv) any distributor, sales representative or
dealer agreement not terminable by any FMLP Operating Entity upon
ninety (90) days or less written notice without penalty,

(xv) any Intellectual Property license or royalty
agreement,
<PAGE> 23

-17-

(xvi) any independent contractor agreement
requiring payments by any FMLP Operating Entity in excess of $50,000
per year,

(xvii) any agreement providing for indemnification
by any FMLP Operating Entity other than indemnification agreements
contained in standard terms and conditions of sale, or

(xviii) any other agreement (or group of related
agreements with the same Person or its Affiliates) not cancelable by
any FMLP Operating Entity without penalty the performance of which
will extend over a period of more than one (1) year, involves
consideration in excess of $100,000 or is anticipated to result in a
loss to any FMLP Operating Entity exceeding $10,000.

(cl) "Merger Agreement" shall mean the Agreement and Plan
of Merger dated the date of this Agreement between Buyer, FMI
Management Company, Mitchell H. Saranow and The Saranow Company
pursuant to which Buyer will acquire by merger all of the shares of
The Saranow Company.

(cm) "Minor Contracts" shall mean any contract and other
agreement (other than the Material Contracts), whether written or
oral, to which any FMLP Operating Entity is a party or by which any
FMLP Operating Entity is bound relating to or affecting the Business.

(cn) "Multiemployer Plan" shall have the meaning set forth
in Section 3(37) of ERISA.

(co) "Non-Assumed Liabilities" shall mean the American
Non-Assumed Liabilities, the Dutch Non-Assumed Liabilities, the
Australian Non-Assumed Liabilities, the German Non-Assumed
Liabilities and the Bethesda Non-Assumed Liabilities. It is
understood that Non-Assumed Liabilities with respect to any FMLP
Operating Entity the shares or other equity interests of which are
being acquired by Buyer pursuant to this Agreement or the Other
Purchase Agreements (including, without limitation, FM-Service,
FM-Brazil, FM-Germany, FM-U.K., FM-Sweden and FM-Spain) means
liabilities which, notwithstanding that such FMLP Operating Entity
remains primarily obligated therefor, are to be paid or performed by
Sellers or the Other Sellers including, without limitation, the
Funded Debt and any Taxes included in the Non-Assumed Liabilities.

(cp) "Notes Receivable" shall mean any notes receivable of
the Business.

(cq) "Other Current Assets" shall mean all current assets
of the Business other than Accounts Receivable, Inventory and
Excluded Assets, as determined in accordance with GAAP (to the extent
reflected on the Closing Date Financial Report).
<PAGE> 24

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(cr) "Other Purchase Agreements" shall mean (i) the Real
Property Purchase Agreement and (ii) the Foreign Asset Purchase
Agreements.

(cs) "Other Sellers" shall mean (i) Bethesda in its
capacity as seller under the Real Property Purchase Agreement and
(ii) each of FM-Holland, FM-Europe, FM-Australia and FM-International
in its capacity as a seller under the Foreign Asset Purchase
Agreements.

(ct) "Owned Intellectual Property" shall mean all
Intellectual Property of the Business owned by any FMLP Operating
Entity.

(cu) "Owned Tangible Personal Property" shall mean all
Tangible Personal Property of the Business owned by any FMLP
Operating Entity or Bethesda.

(cv) "PBGC" shall mean the Pension Benefit Guaranty
Corporation.

(cw) "Permitted Encumbrances" shall mean (i) liens which
will be removed by payment of liabilities reflected on the Closing
Date Financial Report in the amounts reflected on the Closing Date
Financial Report and (ii) liens which are removed on or prior to the
Closing Date.

(cx) "Permits" shall mean all permits, licenses, consents,
franchises, approvals and other authorizations required from any
Governmental Authority or other Person in connection with the
operation of the Business and necessary to conduct the Business as
presently conducted.

(cy) "Person" shall mean any Governmental Authority,
individual, association, joint venture, partnership, corporation,
limited liability company, trust or other entity.

(cz) "Predecessor" shall mean a Person, if any, whose
status or activities could give rise to an Environmental Claim
against any FMLP Operating Entity or Bethesda as a successor in
interest to such Person.

(da) "Proceeding" shall mean any claim, demand, action,
suit, litigation, dispute, order, writ, injunction, judgment,
assessment, decree, grievance, arbitral action, investigation or
other proceeding.

(db) "Prohibited Transaction" shall have the meaning set
forth in ERISA Section 406 and Code Section 4975.
<PAGE> 25

-19-

(dc) "Purchased Cash" shall mean cash and cash equivalents
of any FMLP Operating Entity held in any payroll account, petty cash
account or any other bank account of any FMLP Operating Entity which
the parties agree to transfer to Buyer.

(dd) "Purchase Price Closing Adjustment" shall mean the
sum, whether positive or negative, of (i) the Consolidated Working
Capital Adjustment and (ii) the Consolidated Tangible Personal
Property Gross Book Value Adjustment.

(de) "Real Property" shall mean all real property now or in
the past owned or leased by any FMLP Operating Entity, Bethesda or
any Predecessor, or in which any FMLP Operating Entity, Bethesda or
any Predecessor has now or in the past had any interest, together
with (i) all buildings and improvements located thereon and (ii) all
rights, privileges, interests, easements, hereditaments and
appurtenances thereunto in any way incident, appertaining or
belonging.

(df) "Real Property Purchase Agreement" shall mean the Real
Property Purchase Agreement dated the date of this Agreement between
Buyer and Bethesda.

(dg) "Related Person" shall mean any partner, shareholder,
director, officer or employee of any FMLP Operating Entity, any
Person related to any such partner, shareholder, director, officer or
employee by blood or marriage, or any corporation, partnership, trust
or other entity in which any such person has a substantial interest
as a shareholder, partner, trustee or otherwise.

(dh) "Release" shall mean any spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping,
leaching, migration, dumping or disposing into the environment which
could give rise to an Environmental Claim or which is required to be
reported pursuant to 40 C.F.R. 302 or 355, or any analogous
Environmental Law.

(di) "Reportable Event" shall have the meaning set forth in
ERISA Section 4043.

(dj) "Representative" shall mean any officer, director,
principal, attorney, accountant, agent, employee or other
representative of any Person.

(dk) "Sellers" shall mean FMLP, FMLLC, FM-Canada and
FM-France.

(dl) "Sellers' Accountants" shall mean those accountants at
the firm of Deloitte & Touche LLP who from time to time provide
accounting services to FMLP and its Subsidiaries.
<PAGE> 26

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(dm) "Subsidiaries" shall mean all entities which are
consolidated with FMLP in the Financial Statements for the year
ending December 31, 1995, and all entities acquired by FMLP or its
Subsidiaries since December 31, 1995 which, if owned prior to
December 31, 1995, would have been consolidated with FMLP in the
Financial Statements.

(dn) "Tangible Personal Property" shall mean all tangible
personal property of the Business (other than Inventory) owned or
leased by any FMLP Operating Entity or Bethesda or in which any FMLP
Operating Entity or Bethesda has any interest including, without
limitation, show equipment, production and processing equipment,
warehouse equipment, computer hardware, furniture and fixtures,
transportation equipment, leasehold improvements, supplies and other
tangible assets, together with any transferable manufacturer or
vendor warranties related thereto. Solely for purposes of
calculating Consolidated Tangible Personal Property Gross Book Value,
Tangible Personal Property shall (i) include any software which is
capitalized under GAAP and (ii) exclude the items in clauses (iv) and
(v) of the definition of Accrued Liabilities to the extent the
expenses therefor would be capitalized under GAAP.

(do) "Tax" shall mean any federal, state, local or foreign
income, gross receipts, license, payroll, employment, excise,
severance, startup, occupation, premium, windfall profits,
environmental (including taxes under Code Section 59A), customs
duties, capital stock, franchise, profits, withholding, social
security (or similar), unemployment, disability, real property,
personal property, intangible property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated,
or other tax of any kind whatsoever, including any interest, penalty
or addition thereto, whether disputed or not.

(dp) "Tax Return" shall mean any return, declaration,
report, claim for refund, or information return or statement relating
to Taxes, including any schedule or attachment thereto, and any
amendment thereof.

1.2 Other Defined Terms. The following terms shall have
the meanings defined for such terms in the Sections set forth below:

<TABLE>
<CAPTION>
Term Section
---- -------
<S> <C>
Accounts Receivable Guarantee Amount 9.7(b)
Amended Management Agreement 6.10
American Non-Assumed Contracts 1.1(g)
American Non-Assumed Employee Benefit Plans 1.1(h)
Australian Purchase Agreement 1.1(bm)
Casualty 10.2
Casualty Amount 10.2
Closing 3.1
</TABLE>
<PAGE> 27

-21-

<TABLE>
<S> <C>
Closing Certificate 2.4(a)
Closing Date Financial Report 2.4(c)
Closing Purchase Price Reconciliation 2.5(e)
Dutch Purchase Agreement 1.1(bm)
Employee Certificate 8.8
Escrow Agreement 6.7
Final Purchase Price Closing Adjustment 2.5(c)
German Non-Assumed Employee Benefit Plans 1.1(bq)
IEPA 9.12
IEPA No Further Remediation Letter 9.12
Letter Agreement 10.12
Non-Compete Agreement 6.9
Non-Transferable Assets 3.5
Phantom Equity Plan 1.1(an)
Preliminary Purchase Price Closing Adjustment 2.4(a)
Qualified Individual 9.4
Required Consents and Filings 6.3
TCE 1.1(m)
TCE Liability 1.1(m)
</TABLE>

1.3 Terms Used in Other Purchase Agreements. All initially
capitalized terms used in this Agreement but not defined in this Agreement
shall have the meanings given to them in the Other Purchase Agreements.

1.4 Usage of Terms. Except where the context otherwise requires,
words importing the singular number shall include the plural number and vice
versa. Use of the word "including" shall mean "including, without limitation".

1.5 References to Articles, Sections, Exhibits and Schedules. All
references in this Agreement to Articles, Sections (and other subdivisions),
Exhibits and Schedules refer to the corresponding Articles, Sections (and other
subdivisions), Exhibits and Schedules of or attached to this Agreement, unless
the context expressly, or by necessary implication, otherwise requires.

1.6 Currency Conversion Rates. Solely for purpose of calculating the
Purchase Price Closing Adjustment and the Consolidated Gross Profit Adjustment,
and verifying the representations and warranties of FMLP contained in this
Agreement, assets,
<PAGE> 28

-22-

liabilities, revenues and expenses not denominated in U.S. Dollars
shall be valued based on the March 29, 1996 currency conversion
rates, which as to certain currencies are set forth below:

1 German Mark = U.S. $.6771
1 Netherlands Guilder = U.S. $.6048
1 Australian Dollar = U.S. $.7823

ARTICLE 2
PURCHASE AND SALE OF ASSETS OF SELLERS;
PURCHASE AND SALE OF FM-SERVICE SHARES,
FM-BRAZIL SHARES AND FM-GERMANY SHARES

2.1 Transfer of American Purchased Assets, FM-Service
Shares, FM-Brazil Shares and FM-Germany Shares. Subject to the terms
and conditions contained in this Agreement, on the Closing Date:

(a) (i) Sellers shall sell, convey, transfer, assign, and
deliver to Buyer, and Buyer shall acquire from Sellers, the American
Purchased Assets, free and clear of any Encumbrances (other than
Permitted Encumbrances) and (ii) Sellers shall retain the American
Excluded Assets.

(b) FMLP shall convey, transfer, assign and deliver to
Buyer, and Buyer shall acquire from FMLP, the FM-Service Shares, free
and clear of any Encumbrances (other than Permitted Encumbrances).

(c) FMLP and FM-International shall sell, convey,
transfer, assign and deliver to Buyer, and Buyer shall acquire from
FMLP and FM-International, the FM-Brazil Shares, free and clear of
any Encumbrances (other than Permitted Encumbrances).

(d) FMLP and FM-International shall sell, convey,
transfer, assign and deliver to Buyer, and Buyer shall acquire from
FMLP and FM-International, the FM-Germany Shares, free and clear of
any Encumbrances (other than Permitted Encumbrances).

2.2 Assumption and Payment or Performance of American
Assumed Liabilities; Payment or Performance of American Non-Assumed
Liabilities and German Non-Assumed Liabilities. On the Closing Date,
Buyer shall assume and pay or perform in accordance with their terms
the American Assumed Liabilities and FM-International, FM-Europe and
Sellers shall retain and pay or perform in accordance with their
terms the American Non-Assumed Liabilities and the German Non-Assumed
Liabilities.
<PAGE> 29

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2.3 Consideration; Allocation. As consideration for the
sale, transfer, assignment, conveyance and delivery of the American
Purchased Assets, the FM-Service Shares and the FM-Brazil Shares,
Buyer shall pay to Sellers and FM-International an amount equal to
the American Purchase Price and shall assume the American Assumed
Liabilities. As consideration for the sale, transfer, assignment,
conveyance and delivery of the FM-Germany Shares, Buyer shall pay to
FMLP and FM-International the German Purchase Price. Such
consideration shall be allocated as set forth on Schedule 2.3 which
also sets forth the allocation of the purchase consideration payable
under the Other Purchase Agreements. Unless otherwise agreed in
writing by Buyer and FMLP, Buyer, Sellers and FM-International shall
(i) reflect the American Purchased Assets, the FM-Service Shares, the
FM-Brazil Shares and the FM-Germany Shares, in their books and for
federal, state, local and foreign tax reporting purposes in
accordance with such allocation, (ii) file all forms required under
Section 1060 of the Code and all other tax returns and reports in
accordance with and based upon such allocation and (iii) unless
required to do so in accordance with a "determination" as defined in
Section 1313(a)(1) of the Code, take no position in any tax return,
tax proceeding, tax audit or otherwise which is inconsistent with
such allocation.

2.4 Closing Certificate; Preliminary Purchase Price
Closing Adjustment; Physical Inventory; Audit; Closing Date Financial
Report; Final Purchase Price Closing Adjustment.

(a) Closing Certificate; Preliminary American Purchase
Price Closing Adjustment. On the third business day prior to the
Closing Date, the President or the Chief Financial Officer of The
Saranow Company shall in good faith prepare and deliver to Buyer a
certificate (the "Closing Certificate") containing a proforma
estimate of the Closing Date Consolidated Working Capital and the
Closing Date Consolidated Tangible Personal Property Gross Book
Value, and the Consolidated Working Capital Adjustment, the
Consolidated Tangible Personal Property Gross Book Value Adjustment
and the Purchase Price Closing Adjustment based thereon (the
"Preliminary Purchase Price Closing Adjustment"), which shall be
subject to limited procedures of inquiry by Buyer and Buyer's
Accountants as to reasonableness. The Closing shall proceed, and the
payments required to be made on the Closing Date pursuant to Section
2.5(c) shall be determined, on the basis of the Closing Certificate
and the Preliminary Purchase Price Closing Adjustment.

(b) Physical Inventory. There shall be conducted by FMLP
and its Subsidiaries and observed by Sellers' Accountants, Buyer and
Buyer's Accountants a physical taking of Inventory of FMLP and its
Subsidiaries commencing July 26, 1996. With respect
to any Inventory of FMLP and its Subsidiaries located at any premises
not owned or leased by FMLP and its Subsidiaries, (i) for purposes of
the Preliminary Purchase Price Closing Adjustment, FMLP shall provide
to Buyer in writing a good faith estimate as to the amount of such
off-site Inventory prior to the Closing Date and (ii) for purposes of
the Final Purchase Price Closing Adjustment, FMLP and its
Subsidiaries or Sellers' Accountants shall
<PAGE> 30

-24-

obtain from each Person who is in possession of any such off-site
Inventory written certification as to the amount of such off-site
Inventory as of the Closing Date. The results of the physical
inventory, as adjusted by additions to or deletions from Inventory to
the Closing Date, shall be used in the preparation of the Closing
Date Financial Report pursuant to Section 2.4(c). Subject to the
criteria for excess Inventory as set forth in the definition of
"Inventory", in connection with the preparation of the Closing Date
Financial Report, the valuation of Inventory will be computed by
Sellers' Accountants in accordance with GAAP.

(c) Audit; Closing Date Financial Report. As promptly as
possible after the Closing, FMLP shall cause Sellers' Accountants to
prepare and deliver to FMLP (i) an audited consolidated balance sheet
with consolidating schedule of FMLP and its Subsidiaries as of the
Closing Date in accordance with GAAP and (ii) a supplemental report
setting forth the Closing Date Consolidated Working Capital, the
Closing Date Tangible Personal Property Gross Book Value, the
Consolidated Working Capital Adjustment, the Consolidated Tangible
Personal Property Gross Book Value Adjustment and the definitive
Purchase Price Closing Adjustment based on said audited balance
sheets (the "Final Purchase Price Closing Adjustment") and (iii) a
supplemental report setting forth the Consolidated Gross Profit for
the period from January 1, 1996 through the Closing Date for purposes
of the Consolidated Gross Profit Adjustment pursuant to Section 9.6,
each of which shall be reported on by Sellers' Accountants without
qualification (the "Closing Date Financial Report"). Any third-party
expenses or fees incurred in preparing or in connection with the
Closing Date Financial Report and the Final Purchase Price Closing
Adjustment (including, without limitation, any such expenses or fees
of Sellers' Accountants incurred in connection with the observation
of the physical inventory pursuant to Section 2.4(b)) shall be borne
by FMLP. As promptly as reasonably practicable and, in any event,
not later than 60 days after the Closing Date, Sellers' Accountants
shall deliver to Buyer the Closing Date Financial Report, together
with their audit report and shall make available any work papers or
other information then or thereafter requested by Buyer. If Buyer
does not object, or otherwise fails to respond, to the Closing Date
Financial Report within 20 days after delivery to Buyer, such Closing
Date Financial Report shall automatically become final and
conclusive. In the event that Buyer objects to the Closing Date
Financial Report within such 20-day review period, FMLP and Buyer
shall promptly meet and endeavor to reach agreement as to the content
of the Closing Date Financial Report. If FMLP and Buyer agree on the
content of the Closing Date Financial Report, such Closing Date
Financial Report shall become final and conclusive. If FMLP and
Buyer are unable to reach agreement within 15 days after the end of
Buyer's 20-day review
period, then the Independent Accountants shall promptly be retained
to undertake a determination of the Closing Date Financial Report,
which determination shall be made as quickly as possible. Only
disputed item(s) shall be submitted to the Independent Accountants
for review. In resolving any disputed item, the Independent
Accountants may not assign a value to such item greater than the
greatest value for such item claimed by either party or less than the
lowest value for such item claimed by either party, in each case as
presented to the Independent Accountants. Such determination of the
<PAGE> 31

-25-

Independent Accountants shall be final and binding on FMLP and Buyer,
and all expenses of the Independent Accountants shall be borne
equally by FMLP and Buyer. The Purchase Price and the payments
required to be made after the Closing Date pursuant to Section 2.5(e)
shall be finally determined on the basis of the Closing Date
Financial Report and the Final Purchase Price Closing Adjustment.

2.5 Payments by Buyer. Buyer shall pay to FMLP, on behalf
of FM-International and Sellers, the purchase consideration set forth
in Section 2.3 as follows:

(a) At the Closing, Buyer shall pay to the appropriate
parties the Funded Debt of all FMLP Operating Entities conducting the
American Business and the German Business, by wire transfer to
accounts designated in writing by such parties to Buyer not less than
two (2) business days prior to the Closing Date.

(b) At the Closing, Buyer shall deposit the Initial Escrow
Deposit with the Escrow Agent by wire transfer to an account
designated by the Escrow Agent to Buyer in writing not less than two
(2) business days prior to the Closing Date.

(c) At the Closing, Buyer shall pay to FMLP an amount
equal to (i) the sum of (A) American Purchase Price (as adjusted by
the Preliminary Purchase Price Closing Adjustment) and (B) the German
Purchase Price minus (ii) the sum of (A) the Funded Debt of all FMLP
Operating Entities conducting the American Business and German
Business and (B) Initial Escrow Deposit, in cash by wire transfer to
an account designated by FMLP to Buyer in writing not less than two
(2) business days prior to the Closing Date.

(d) At the Closing, Buyer shall assume the American
Assumed Liabilities.

(e) Within five (5) business days after determination of
the Final Purchase Price Closing Adjustment, Buyer or FMLP, as the
case may be, shall pay to the other the amount by which the American
Purchase Price, as adjusted by the Final Purchase Price Closing
Adjustment, is greater or less than the American Purchase Price, as
adjusted by the Preliminary Purchase Price Closing Adjustment (such
difference being the "Closing Purchase Price Reconciliation"). If
the Closing Purchase Price Reconciliation is positive, Buyer shall
pay such difference to FMLP. If the Closing Purchase Price
Reconciliation is negative, FMLP shall pay such difference to Buyer.
Amounts payable by FMLP pursuant to this Section 2.5(e) and not paid
by FMLP within said five-day period shall be payable from the Escrow
Funds, and FMLP shall restore the Escrow Funds as required by Section
9.2. If (i) Buyer fails to pay any amount owing to FMLP pursuant to
this subsection (e) or (ii) FMLP fails to pay any amount owing to
Buyer pursuant to this subsection (e) (including by application of the
Escrow Funds), within the specified five business day period, then
the amount so owing shall be payable on demand and interest shall
accrue on the unpaid amount
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from the date due until paid at a rate equal to the lower of (A) ten
percent (10%) per annum or (B) the highest rate permitted by law.

2.6 Taxes. FMLP and Buyer shall each be responsible for
the payment of one-half of any sales, use, transfer, excise, stamp or
other similar taxes imposed by reason of the transfer of the American
Purchased Assets, the FM-Service Shares, the FM-Brazil Shares and the
FM-Germany Shares (including, without limitation, taxes attributable
to any part or all of the Current Real Property imposed as a result
of the direct or indirect transfer thereof) pursuant to this
Agreement and any deficiency, interest or penalty with respect to
such taxes; provided, however, that any such deficiency, interest or
penalty which results from either party's failure to pay or account
for the agreed-upon amount of any such sales, use, transfer, excise,
stamp or other similar tax shall be borne by the party which is at
fault.

ARTICLE 3
CLOSING

3.1 Closing. The closing of the transactions contemplated
by this Agreement shall be held at 10:00 a.m. local time on the
Closing Date at the offices of McDermott, Will & Emery, Chicago,
Illinois, or any other place as Buyer and FMLP mutually agree in
writing ("Closing"); provided, however, that to the extent any
transfers, conveyances or other events in connection with the closing
of the transactions contemplated by this Agreement are required to
occur in any foreign jurisdiction, the parties shall take all steps
necessary to cause such transfers, conveyances or events to occur in
such jurisdiction. The Closing shall be effective as of the close of
business on the Closing Date.

3.2 Conveyances at Closing.

(a) Instruments and Possession. Upon the terms and
conditions contained in this Agreement, on the Closing Date, Sellers
and FM-International shall deliver to Buyer (i) one or more bills of
sale conveying in the aggregate all of the Owned Tangible Personal
Property of Sellers, (ii) one or more assignments conveying in the
aggregate all of the American Assumed Contracts, (iii) one or more
assignments of the Owned Intellectual Property of Sellers in
recordable form, (iv) stock certificates representing the FM-Service
Shares, the FM-Brazil Shares and the FM-Germany Shares duly endorsed
for transfer or accompanied by one or more duly executed stock
powers, (v) the minute books and stock record books of FM-Service,
FM-Brazil and FM-Germany, (vi) a lease cancellation for the lease of
the Wheeling Real Property, (vii) certificates of amendment to each of
the organizational documents of FMLP and its Affiliates in proper
form for filing with the Secretary of State of Illinois or other
applicable Governmental Authority, and all other appropriate
certificates for filing in other applicable jurisdictions, changing
the name of each of FMLP and its Affiliates to a name that does not
contain the words "Fluid Management" or "FM" or any derivative or
variation thereof, (viii) such other instruments as shall be
<PAGE> 33

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reasonably requested by Buyer to vest in Buyer title in and to the
American Purchased Assets, the FM-Service Shares, the FM-Brazil
Shares and the FM-Germany Shares in accordance with the provisions of
this Agreement and (ix) such other documents and agreements as are
contemplated by this Agreement.

(b) Form of Instruments. All of such instruments shall be
in form and substance, and shall be executed and delivered in a
manner, reasonably satisfactory to Buyer and FMLP, but shall not
diminish the status of title to the American Purchased Assets, the
FM-Service Shares, the FM-Brazil Shares or the FM-Germany Shares
required to be delivered by Sellers and FM-International pursuant to
this Agreement.

3.3 Assumptions at Closing.

(a) Instruments. Upon the terms and conditions contained
in this Agreement, on the Closing Date, Buyer shall deliver to
Sellers (i) an assumption of the American Assumed Liabilities, (ii)
such other instruments of assumption evidencing Buyer's assumption of
the American Assumed Liabilities as FMLP shall deem necessary and
(iii) such other documents and agreements as are contemplated by this
Agreement.

(b) Form of Instruments. All such instruments shall be in
form and substance, and shall be executed and delivered in a manner,
reasonably satisfactory to FMLP and Buyer, but shall not increase or
decrease the American Assumed Liabilities required to be assumed by
Buyer pursuant to this Agreement.

3.4 Certificates and Other Documents. Each of Buyer,
FM-International, FM-Europe and Sellers shall deliver or cause to be
delivered the certificates and other documents and items described in
Articles 6, 7 and 8 of this Agreement.

3.5 Non-Transferable Assets. It is understood that
certain American Purchased Assets (including, without limitation,
manufacturers', contractors' and other warranties and guaranties, and
rights under outstanding letters of credit) may not be immediately
transferable or assignable to Buyer, and Buyer may in its sole
discretion allow Sellers to retain certain of such assets after the
Closing Date (the "Non-Transferable Assets"), and this Agreement
shall not constitute an assignment of any such Non-Transferable
Assets. In such event, (i) Sellers shall grant to Buyer full use and
benefit of their interest in the Non-Transferable Assets, it being
the intent of the parties that Buyer shall have the benefit of the
Non-Transferable Assets as though it were the sole owner thereof,
(ii) Sellers shall take all actions necessary to preserve the value
of the Non-Transferable Assets, (iii) Sellers shall not transfer or
assign the Non-Transferable Assets to any Person other than Buyer or
Buyer's assigns, (iv) Sellers shall transfer or assign the
Non-Transferable Assets to Buyer at the earliest date on which such
transfer or assignment can be effected and (v) Buyer shall be
responsible for obligations relating to such
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Non-Transferable Assets as if they had been transferred or assigned
to Buyer in accordance with the terms of this Agreement.

ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF FMLP

FMLP represents and warrants to Buyer as follows:

4.1 Representations and Warranties With Respect To the
American Business. With respect to the entire Business, all FMLP
Operating Entities, Bethesda and the Wheeling Real Property, FMLP
makes the representations and warranties set forth in paragraph (h)
(Financial Statements; Unknown Liabilities) of Schedule 4.1. With
respect to the American Business and the FMLP Operating Entities
conducting the American Business, FMLP makes each of the
representations and warranties set forth on Schedule 4.1. Except
with respect to paragraph (h) (Financial Statements; Unknown
Liabilities), all references in Schedule 4.1 to FMLP Operating
Entities shall mean the FMLP Operating Entities conducting the
American Business.

4.2 Representations and Warranties With Respect To the
Dutch Business. With respect to the Dutch Business and the FMLP
Operating Entities conducting the Dutch Business, FMLP makes each of
the representations and warranties set forth on Schedule 4.2. All
references in Schedule 4.2 to FMLP Operating Entities shall mean the
FMLP Operating Entities conducting the Dutch Business.

4.3 Representations and Warranties With Respect To the
Australian Business. With respect to the Australian Business and the
FMLP Operating Entities conducting the Australian Business, FMLP
makes each of the representations and warranties set forth on
Schedule 4.3. All references in Schedule 4.3 to FMLP Operating
Entities shall mean the FMLP Operating Entities conducting the
Australian Business.

4.4 Representations and Warranties With Respect To the
German Business. With respect to the German Business and the FMLP
Operating Entities conducting the German Business, FMLP makes each of
the representations and warranties set forth on Schedule 4.4. All
references in Schedule 4.4 to FMLP Operating Entities shall mean the
FMLP Operating Entities conducting the German Business.

4.5 Representations and Warranties With Respect To
Bethesda and the Wheeling Real Property. With respect to Bethesda
and the Wheeling Real Property, FMLP makes each of the
representations and warranties set forth on Schedule 4.5.

4.6 No Implied Representations and Warranties. EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT, THE OTHER PURCHASE
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AGREEMENTS AND ANY CERTIFICATES AND INSTRUMENTS TO BE EXECUTED AND
DELIVERED IN CONNECTION WITH THIS AGREEMENT, FMLP MAKES NO
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE BUSINESS, THE
AMERICAN PURCHASED ASSETS, THE FM-SERVICE SHARES, THE FM-BRAZIL
SHARES, THE FM-GERMANY SHARES, THE DUTCH PURCHASED ASSETS, THE
FM-SPAIN SHARES, THE FM-SWEDEN SHARES, THE FM-U.K. SHARES, THE
AUSTRALIAN PURCHASED ASSETS, THE WHEELING REAL PROPERTY, THE ASSUMED
LIABILITIES OR THE NON-ASSUMED LIABILITIES, AND FMLP HEREBY DISCLAIMS
ALL IMPLIED REPRESENTATIONS AND WARRANTIES (INCLUDING, WITHOUT
LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR
A PARTICULAR PURPOSE).

ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer hereby represents and warrants to FMLP as follows:

5.1 Organization and Good Standing. Buyer is a Delaware
corporation, duly organized, validly existing and in good standing
under the laws of the state of Delaware. Buyer has full power and
authority to conduct its business as presently being conducted and to
own and lease its properties and assets.

5.2 Authority; Authorization; Binding Effect. Buyer has
all necessary power and authority to execute and deliver this
Agreement and the Other Purchase Agreements, to consummate the
transactions contemplated by this Agreement and the Other Purchase
Agreements and to perform its obligations under this Agreement and
the Other Purchase Agreements. Copies of all resolutions of the
board of directors of Buyer with respect to the transactions
contemplated by this Agreement and the Other Purchase Agreements,
certified by the Secretary or an Assistant Secretary of Buyer, in
form reasonably satisfactory to counsel for FMLP, have been delivered
to FMLP. Each of this Agreement and the Other Purchase Agreements
has been duly executed and delivered by Buyer and constitutes a
legal, valid and binding obligation of Buyer, enforceable against
Buyer in accordance with its terms, except as such enforcement may be
limited by Enforceability Limitations.

5.3 No Conflict or Violation. The execution and delivery
of this Agreement and the Other Purchase Agreements, the consummation
of the transactions contemplated by this Agreement and the Other
Purchase Agreements and the performance by Buyer of its obligations
under this Agreement and the Other Purchase Agreements, do not and
will not result in or constitute (i) a violation of or a conflict
with any provision of the certificate of incorporation or by-laws of
Buyer, (ii) a breach of, a loss of rights under, or constitute an
event, occurrence, condition or act which is or, with the giving of
notice, the
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lapse of time or the happening of any future event or condition,
would become, a material default under, any term or provision of any
contract, agreement, indebtedness, lease, commitment, license,
franchise, permit, authorization or concession to which Buyer is a
party or (iii) a violation by Buyer of any statute, rule, regulation,
ordinance, code, order, judgment, writ, injunction, decree or award.

5.4 Consents and Approvals. Except for any filings or
approvals required under the HSR Act which have been completed and
with respect to which early termination of the waiting period has
been granted, no consent, approval or authorization of, or
declaration, filing or registration with, any Person is required to
be made or obtained by Buyer in connection with the execution,
delivery and performance of this Agreement and the Other Purchase
Agreements, and the consummation of the transactions contemplated by
this Agreement and the Other Purchase Agreements.

5.5 No Proceedings. There is no Proceeding pending or, to
the knowledge of Buyer, threatened against, relating to or affecting
in any adverse manner the transactions contemplated by this Agreement
and the Other Purchase Agreements.

5.6 Financial Resources. Buyer has adequate financial
resources to consummate the transactions contemplated by this
Agreement and the Other Purchase Agreements.

5.7 No Brokers. Buyer has not entered into any agreement,
arrangement or understanding with any Person which will result in the
obligation to pay any finder's fee, brokerage commission or similar
payment in connection with the transaction contemplated hereby.

ARTICLE 6
COVENANTS AND CONDUCT OF
THE PARTIES PRIOR TO CLOSING

FMLP on the one hand, and Buyer on the other hand, each
covenant and agree with the other as follows:

6.1 Investigation by Buyer. During the period beginning
on the date of this Agreement and ending on the Closing Date, Buyer
and each Representative of Buyer may continue to conduct a due
diligence review of each FMLP Operating Entity and the Business. In
connection with such due diligence review, Buyer and each
Representative of Buyer shall be granted full access to all Current
Real Property upon reasonable notice and during normal business
hours. In connection with such due diligence review, FMLP agrees,
and shall cause each Representative of FMLP, upon reasonable prior
notice, to (i) cooperate with Buyer and each Representative of Buyer,
(ii) provide all information, and all documents and other data
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relating to such information, reasonably requested by Buyer or any
Representative of Buyer (including, without limitation, the work
papers of Sellers' Accountants and all responses to auditor's inquiry
letters for the past five (5) years) and (iii) permit Buyer and each
Representative of Buyer to inspect any assets of any FMLP Operating
Entity.

6.2 Environmental Audits. In addition to any
environmental investigations and audits conducted by Buyer or its
Representatives prior to the date of this Agreement, Buyer shall, at
Buyer's sole expense, be permitted to cause further "Phase I" and
"Phase II" environmental audits of the Current Real Property to be
conducted assessing the presence and or disposition of Hazardous
Substances and compliance with Environmental Laws. Each FMLP
Operating Entity hereby grants a license to Buyer's qualified
environmental consultants to enter upon the Current Real Property,
upon giving FMLP reasonable notice, with men and materials to conduct
such environmental audits. In connection with any such environmental
audits and at the request of FMLP, Buyer shall from time to time
enter into agreements relating to indemnification for damages and
confidentiality of audit results, in the form of the Indemnification
and Confidentiality Agreement between FMLP and Buyer.

6.3 Notifications, Consents and Approvals. As soon as
practicable, Buyer and each FMLP Operating Entity, as applicable,
shall commence all reasonable actions to obtain the consents and
approvals and to make the filings set forth on Schedule 6.3 (the
"Required Consents and Filings") required to consummate the
transactions contemplated by this Agreement and the Other Purchase
Agreements.

6.4 Conduct Pending Closing. (a) From the date of this
Agreement to the Closing Date, and except as otherwise specifically
provided in this Agreement or consented to or approved by Buyer in
advance in writing, such consent or approval not to be unreasonably
withheld or delayed, FMLP agrees for itself and on behalf of each
FMLP Operating Entity as follows:

(i) Each FMLP Operating Entity shall carry on its business
substantially in the same manner as heretofore conducted and shall
not engage in any transaction or activity, enter into or amend any
agreement or make any commitment except in the ordinary course of
business.

(ii) No change or amendment shall be made in or to the
certificate or other governing or organizational instruments of
FM-Service, FM-Brazil, FM-U.K., FM-Sweden, FM-Spain or FM-Germany.

(iii) Each FMLP Operating Entity shall use reasonable
commercial efforts to preserve its existence and business
organization intact and to preserve its properties, assets and
relationships with its employees, suppliers, customers and others
with whom it has business relations.
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(iv) No FMLP Operating Entity shall (i) grant any increase
in compensation in excess of four (4) percent to any employee whose
1995 calendar-year compensation (base salary plus bonus but excluding
benefits) exceeded $50,000 or (ii) enter into, or amend in any
material respect, any Assumed Employee Benefit Plan.

(v) No FMLP Operating Entity shall (A) grant any special
conditions with respect to any account receivable other than in the
ordinary course of business (e.g., extended terms), (B) fail to pay
any account payable on a timely basis in the ordinary course of
business consistent with past practice, (C) except as disclosed in
this Agreement, make or commit to make any capital expenditures in
excess of $25,000 in the aggregate, (D) purchase Inventory in excess
of supplies necessary in the ordinary course of business and
consistent with past practice (and in no event exceeding, for any
particular item, a six month supply) or (E) start up or acquire any
new business or product line.

(vi) No FMLP Operating Entity shall voluntarily take any
action which would cause, or voluntarily fail to take any action the
failure of which would cause, any representation or warranty of FMLP
contained in this Agreement to be breached or untrue in any respect.

(b) From the date of this Agreement to the Closing Date,
and except as otherwise specifically provided in this Agreement or
consented to or approved by FMLP in advance in writing, such consent
or approval not to be unreasonably withheld or delayed Buyer shall
not voluntarily take any action which would cause, or voluntarily
fail to take any action the failure of which would cause, any
representation or warranty of Buyer contained in this Agreement to be
breached or untrue in any respect.

6.5 Notification of Certain Matters.

(a) FMLP shall give prompt notice to Buyer of (i) any fact
or circumstance, or any occurrence or failure to occur of any event
of which FMLP has knowledge, which fact, circumstance, occurrence or
failure causes or, with notice or the lapse of time, would cause any
representation or warranty of FMLP contained in this Agreement to be
breached or untrue or inaccurate in any respect any time from the
date of this Agreement to the Closing Date and (ii) any failure of
FM-International, FM-Europe or any FMLP Operating Entity to comply
with or satisfy any covenant, condition or agreement to be complied
with or satisfied by FM-International, FM-Europe or any
FMLP Operating Entity under this Agreement or any Other Purchase
Agreement.

(b) Buyer shall give prompt notice to FMLP of (i) any fact
or circumstance, or any occurrence or failure to occur of any event
of which Buyer has knowledge, which fact, circumstance, occurrence or
failure causes or, with notice or the lapse of time, would cause any
representation or warranty of Buyer contained in this
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Agreement to be breached or untrue or inaccurate in any respect any
time from the date of this Agreement to the Closing Date and (ii) any
failure of Buyer to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by Buyer under this
Agreement or any Other Purchase Agreement.

(c) In the event that Buyer receives a notice from FMLP
pursuant to Section 6.5(a) which relates to a breached or untrue
representation or warranty of FMLP, then, in Buyer's or FMLP's
reasonable judgment, if (i) such breached or untrue representation or
warranty together with all other breached or untrue representations
and warranties of which Buyer has been notified pursuant to Section
6.5(a) or of which Buyer has otherwise become aware would have, if
revealed after the Closing Date, resulted in Losses in excess of
$3,000,000, then each of Buyer and FMLP shall have five (5) business
days after delivery of such notice to notify the other party in
writing as to whether it elects to terminate this Agreement, in which
case neither Buyer nor FMLP shall have any liability to the other or
(ii) such breached or untrue representation or warranty together with
all other breached or untrue representations and warranties of which
Buyer has been notified pursuant to Section 6.5(a) or of which Buyer
has otherwise become aware would have, if revealed after the Closing
Date, not resulted in Losses exceeding $3,000,000, then Buyer and
FMLP shall be required to proceed with Closing subject to Buyer
preserving its indemnification rights pursuant to Section 9.1(b)(i)
and any other rights and remedies it may have under this Agreement.
If neither Buyer nor FMLP notifies the other pursuant to clause (i)
of the preceding sentence within such 5-day period of its election to
terminate this Agreement, Buyer and FMLP shall be required to proceed
with Closing subject to Buyer preserving its indemnification rights
pursuant to Section 9.1(b)(i) and any other rights and remedies it
may have under this Agreement. In the event of termination of this
Agreement by Buyer pursuant to this Section 6.5(c), the provisions of
the Letter Agreement relating to payment of a "break-up fee" shall no
longer apply.

(d) In the event FMLP receives a notice from Buyer
pursuant to Section 6.5(b) which relates to a representation or
warranty which is breached or untrue in any material respect of
Buyer, FMLP shall have five (5) business days after receipt of such
notice to respond in writing as to whether it desires to terminate
this Agreement or proceed with Closing subject to preserving its
indemnification rights pursuant to Section 9.1(c) and any other
rights and remedies which it may have under this Agreement. If FMLP
fails to respond within such 5-day period, it shall be required to
proceed with Closing subject to preserving its indemnification rights
pursuant to Section 9.1(c) and any other rights and remedies which it
may have under this Agreement.

6.6 Delivery of Interim Financial Statements. Within
twenty (20) days of the end of each month after the execution of this
Agreement and prior to the Closing Date, FMLP shall deliver or cause
to be delivered to Buyer internally prepared monthly and year-to-date
interim financial statements of FMLP and its Subsidiaries. Upon
delivery, such
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year-to-date interim financial statements shall automatically become
and be deemed to be Interim Financial Statements for purposes of this
Agreement.

6.7 Escrow Agreement. On the Closing Date, FMLP, Buyer
and the Escrow Agent shall enter into an escrow agreement
substantially in the form of Exhibit 6.7 (the "Escrow Agreement").

6.8 Employment Agreement. On the Closing Date, Mitchell
H. Saranow shall enter into an employment agreement with FMI
Management Company (formerly known as The Saranow Company)
substantially in the form of Exhibit 6.8 (the "Saranow Employment
Agreement") and shall execute and deliver IDEX's standard form of
Standards of Conduct and Business Ethics Policy and Employee
Inventions and Proprietary Information Agreement, copies of which
have been delivered to Mitchell H. Saranow.

6.9 Non-Compete and Confidentiality Agreement. On the
Closing Date, the Sellers, the Other Sellers and others shall enter
into a non-compete and confidentiality agreement with Buyer
substantially in the form of Exhibit 6.9 (the "Non-Compete
Agreement").

6.10 Amendment of Management Agreement. On the Closing
Date, Buyer, The Saranow Company and FMLP shall enter into the
Amended and Restated Management Agreement in the form of Exhibit 6.10
(the "Amended Management Agreement").

6.11 Offer of Employment to Sellers' Employees. On the
Closing Date, Buyer shall offer employment to all of Sellers'
employees upon substantially the same terms and conditions as such
employees are presently employed; provided however, that nothing
herein shall require Buyer to retain any such employee for any period
of time or otherwise restrict or limit Buyer's right to terminate or
otherwise alter the terms of employment of any such employee, each of
whom shall be considered an employee "at will" except to the extent
covered by an employment agreement or a severance agreement.
Notwithstanding the foregoing, Buyer shall not take any actions which
may result in any Loss to FMLP under the Worker's Adjustment and
Retraining Notification Act of 1986.

6.12 Assumption of Assumed Employee Benefit Plans.
Effective as of the Closing, Buyer shall assume, and be substituted
for the FMLP Operating Entities as the sponsoring employer of, the
Assumed Employee Benefit Plans, and except as otherwise provided in
this Agreement, as of the Closing, Sellers shall have no liability
with respect thereto to the participants, beneficiaries, trustees of
other fiduciaries thereof. In addition, under the Assumed Employee
Benefit Plans or, to the extent Buyer does not assume any of the
Employee Benefit Plans and incorporates any former employees of any
FMLP Operating Entity into Buyer's comparable employee benefit plans,
Buyer shall use reasonable efforts to waive with respect to such
employees applicable waiting periods under Buyer's plans, to give
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credit to such employees toward deductibles for amounts previously
paid by them under the Employee Benefit Plans, and to give such
employees credit where applicable under Buyer's employee benefit
plans for seniority and vesting purposes.

6.13 Fees. FMLP agrees to pay all finders' fees, brokerage
commissions or similar payments owing to Dean Witter Reynolds, Inc.
and any other finders' fees, brokerage commissions or similar
payments owing to any Person engaged by FMLP or its Subsidiaries in
connection with the transactions contemplated by this Agreement and
the Other Purchase Agreements.

6.14 Elimination of Intercompany Payables. On or prior to
the Closing Date, FMLP shall pay or otherwise eliminate all
intercompany payables between any FMLP Operating Entity and Bethesda,
FM-International or FM-Europe.

6.15 Tail Coverage. To the extent any policy of Insurance
of any FMLP Operating Entity is "claims made" insurance, FMLP shall
purchase "tail" coverage with respect to such policy, on the same or
comparable terms as the existing coverage, from the insurance company
which issued such policy or from another insurance company reasonably
satisfactory to Buyer, and shall take all other actions necessary to
extend the coverage under such "claims made" insurance policy to
cover all occurrences through the Closing Date. On or prior to the
Closing Date, FMLP shall provide to Buyer an original certificate of
insurance and a copy of each insurance policy and other document or
instrument relating to such extended coverage, together with evidence
satisfactory to Buyer that such extended coverage shall remain in
effect for a period of one (1) year after the Closing Date and that
all premiums relating thereto have been fully paid. In the event
that such extended coverage policy is cancelled or otherwise no
longer in effect, FMLP shall purchase another policy or policies with
the same or comparable coverage. Each policy of extended coverage
provided by FMLP under this Section shall name Buyer as an additional
insured and shall require the applicable insurance company to give
Buyer thirty (30) days written notice of any change to or termination
of such policy. To the extent any extended coverage obtained by FMLP
hereunder is subject to a deductible or a coverage limit, FMLP shall
pay the amount of such deductible and all amounts in excess of such
coverage limit.

6.16 Transfer of Interest in LLC. On or prior to the
Closing Date, FMLP shall cause FM-Service to take all actions as may
be necessary for FM-Service to transfer its 1% interest in FMLLC to
an entity not being acquired by Buyer.

6.17 Conversion FM-Brazil and FM-Germany. Prior to the
Closing Date, FMLP and FM-International shall take all actions
necessary to convert each of FM-Brazil and FM-Germany into a
corporation for U.S. tax purposes.
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6.18 Payment of Management Fees. Prior to the Closing
Date, FMLP shall pay to The Saranow Company all management fees and
other amounts (including, without limitation, all reimburseable
expenses payable thereunder) which are due or will become due through
the Closing Date. With respect to any reimburseable expenses, FMLP
shall estimate in good faith all such amounts which will become due
and payable through the Closing Date.

ARTICLE 7
CONDITIONS TO SELLERS' OBLIGATIONS

The obligation of Sellers and the Other Sellers to
consummate the transactions contemplated by this Agreement and the
Other Purchase Agreements, respectively, is subject, in the
discretion of FMLP, to the satisfaction, on or prior to the Closing
Date, of each of the following conditions (any of which, in FMLP's
absolute and sole discretion, may be waived in whole or in part
without impairing or affecting any right of indemnification or other
right or remedy under this Agreement):

7.1 Representations, Warranties and Covenants. Except as
specifically provided in Section 6.5, all representations and
warranties of Buyer contained in this Agreement shall be true and
correct in all material respects at and as of the Closing Date,
except as and to the extent that the facts and conditions upon which
such representations and warranties are based are expressly required
or permitted to be changed by the terms of this Agreement, and Buyer
shall have performed all agreements and covenants required by this
Agreement and the Other Purchase Agreements to be performed by it
prior to or at the Closing Date.

7.2 Required Consents and Filings. The Required Consents
and Filings shall have been obtained or made.

7.3 No Proceedings. No Proceeding shall be pending,
threatened or anticipated against Buyer or any FMLP Operating Entity
seeking to enjoin, or adversely affecting, the consummation of the
transactions contemplated by this Agreement or the Other Purchase
Agreements.

7.4 Closing Certificate. Buyer shall have furnished FMLP
with a certificate of an officer of Buyer, in form and substance
satisfactory to FMLP, to evidence compliance with the conditions set
forth in Sections 7.1, 7.2 and 7.3.

7.5 Legal Opinion. FMLP shall have received an opinion of
Hodgson, Russ, Andrews, Woods & Goodyear, LLP, substantially in the
form of Exhibit 7.5.

7.6 Closing of Other Purchase Agreements and Merger
Agreement. There shall occur contemporaneously with the closing of
the transactions contemplated by this
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Agreement the closing of the transactions contemplated by the Other
Purchase Agreements and the Merger Agreement.

ARTICLE 8
CONDITIONS TO BUYER'S OBLIGATIONS

The obligation of Buyer to consummate the transactions
contemplated by this Agreement, is subject, in the discretion of
Buyer, to the satisfaction, on or prior to the Closing Date, of each
of the following conditions (any of which, in Buyer's absolute and
sole discretion, may be waived in whole or in part without impairing
or affecting any right of indemnification or other right or remedy
under this Agreement):

8.1 Representations, Warranties and Covenants. Except as
specifically provided in Section 6.5, all representations and
warranties of FMLP contained in this Agreement shall be true and
correct in all respects at and as of the Closing Date, except as and
to the extent that the facts and conditions upon which such
representations and warranties are based are expressly required or
permitted to be changed by the terms of this Agreement and each
Seller and Other Seller shall have performed or caused to be
performed all agreements and covenants required by this Agreement and
the Other Purchase Agreements, respectively, to be performed or
caused to be performed by it prior to or at the Closing Date.

8.2 Required Consents and Filings. The Required Consents
and Filings shall have been obtained or made.

8.3 No Proceedings. No Proceeding shall be pending,
threatened or anticipated against Buyer or any FMLP Operating Entity
seeking to enjoin, or adversely affecting, the transactions
contemplated by this Agreement.

8.4 No Interruption or Adverse Change. No interruptions
or suspensions of the Business as now conducted shall have occurred
or, to the knowledge of FMLP, been threatened and no changes in the
business, prospects, assets or financial condition of FMLP and its
Subsidiaries shall have occurred or, to the knowledge of FMLP, been
threatened which in each case, if they were to have occurred after
the Closing Date, would have, in Buyer's reasonable judgment,
resulted in Losses in the aggregate in excess of $3,000,000.

8.5 Closing Certificate. FMLP shall have furnished or
caused to be furnished to Buyer a certificate or certificates in form
satisfactory to Buyer to evidence compliance with the conditions set
forth in Sections 8.1, 8.2, 8.3 and 8.4.
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8.6 Legal Opinions. Buyer shall have received an opinion
from (a) McDermott, Will & Emery substantially in the form of Exhibit
8.6(a) and (b) Gould & Ratner substantially in the form of Exhibit
8.6(b).

8.7 Standard IDEX Agreements. On the Closing Date, each
of the individuals listed on Schedule 8.7 shall execute IDEX's
standard form of Standards of Conduct and Business Ethics Policy and
Employee Inventions and Proprietary Information Agreement.

8.8 Certificates of Employees of Seller and The Saranow
Company. On the Closing Date, (i) with respect to the American
Business, the Australian Business, Bethesda and the Wheeling Real
Property, each of Mitchell H. Saranow, Thomas Carney, Joseph Rygiel
and Michael Kudia and (ii) with respect to the Dutch Business and the
German Business, each of Mitchell H. Saranow, Thomas Carney,
Leendert Hellenberg and John Farla, shall execute and deliver to
Buyer a certificate in the form of Exhibit 8.8 (the "Employee
Certificates") pursuant to which such employee shall represent and
warrant to Buyer that, to the knowledge of such individual, none of
the representations and warranties in Article 4 within the scope of
such individual's employment responsibility are untrue or inaccurate.

8.9 Closing of Other Purchase Agreements and Merger
Agreement. There shall have occurred contemporaneously with the
closing of the transactions contemplated by this Agreement the
closing of the transactions contemplated by the Other Purchase
Agreement and the Merger Agreement.

ARTICLE 9
COVENANTS AND CONDUCT OF
THE PARTIES AFTER CLOSING

9.1 Survival and Indemnifications.

(a) Survival of Representations, Warranties, Covenants and
Agreements.

(i) All representations and warranties of FMLP
contained in this Agreement shall survive the Closing Date for the
duration of the Claims Period; except that (A) the Environmental
Representations shall survive the Closing for a period of three (3)
years and (B) the representations and warranties set forth in clause
(i) of paragraph (g) of Schedule 4.5 (Real Property) shall not survive
the Closing. Any claim made by Buyer with respect to the
representations and warranties of FMLP contained in this Agreement
must be initiated by Buyer during the Claims Period, except that any
claim with respect to the Environmental Representations must be
initiated within three (3) years following the Closing Date. All of
the representations and warranties of FMLP contained in this Agreement
shall
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in no respect be limited or diminished by any past or future
inspection, investigation, examination or possession on the part of
Buyer or its Representatives; provided, however, that to the extent
that as a result of any such inspection, investigation, examination
or possession prior to the Closing (A) Buyer has actual knowledge
that any representation or warranty of FMLP is untrue and (B) FMLP
does not have knowledge that such representation or warranty is
untrue, then FMLP shall have no liability with respect to such untrue
representation or warranty. All covenants and agreements made by any
Seller, any Other Seller, FM-International or FM-Europe contained in
this Agreement or the Other Purchase Agreements which are required to
be performed prior to the Closing Date shall survive the Closing for
the duration of the Claims Period, and any claim made by Buyer with
respect thereto must be initiated during the Claims Period. All
covenants and agreements made by any Seller, any Other Seller,
FM-International or FM-Europe contained in this Agreement or the
Other Purchase Agreements which are required to be performed on or
after the Closing Date (including, without limitation, the obligation
of Sellers, the Other Sellers, FM-International and FM-Europe in this
Agreement and the Other Purchase Agreement to convey the (A) American
Purchased Assets, the FM-Service Shares, FM-Brazil Shares and the
FM-Germany Shares, (B) the Dutch Purchased Assets, the FM-U.K.
Shares, the FM-Spain Shares and the FM-Sweden Shares, (C) the
Australian Purchased Assets and (D) the Wheeling Real Property to
Buyer free and clear of any Encumbrances (other than Permitted
Encumbrances), and the indemnification obligations of FMLP set forth
in this Section) shall survive the Closing Date until fully performed
or discharged.

(ii) All representations and warranties of Buyer
contained in this Agreement shall survive the Closing Date for the
duration of the Claims Period. Any claim made by FMLP with respect
to the representations and warranties of Buyer contained in this
Agreement must be initiated during the Claims Period. All of the
representations and warranties of Buyer contained in this Agreement
shall in no respect be limited or diminished by any past or future
inspection, investigation, examination or possession on the part of
FMLP or its Representatives; provided, however, that to the extent
that as a result of any such inspection, investigation, examination
or possession prior to the Closing (x) FMLP has actual knowledge that
any representation or warranty of Buyer is untrue and (y) Buyer does
not have knowledge that such representation or warranty is untrue,
then Buyer shall have no liability with respect to such untrue
representation or warranty. All covenants and agreements made by
Buyer contained in this Agreement and the Other Purchase Agreements
which are required to be performed prior to the Closing Date shall
survive the Closing for the duration of the Claims Period, and any
claim made by any Seller or any Other Seller with respect thereto
must be initiated during the Claims Period. All covenants and
agreements made by Buyer contained in this Agreement and the Other
Purchase Agreements which are required to be performed on or after
the Closing Date (including the indemnification obligations of Buyer
set forth in this Section) shall survive the Closing Date until
fully performed or discharged.
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(iii) FMLP acknowledges that, in the event that
any of the representations and warranties of FMLP contained in
paragraph (h) (Financial Statements; Unknown Liabilities) of Schedule
4.1 is breached or untrue then, notwithstanding (A) the fact that any
other representation or warranty of FMLP contained in this Agreement
is not breached or untrue and (B) the obligations of Buyer in this
Agreement and the Other Purchase Agreements to assume the Assumed
Liabilities, FMLP shall be liable to Buyer pursuant to Section
9.1(b)(i) for such breached or untrue representation or warranty
contained in paragraph (h) (Financial Statements; Unknown
Liabilities)of Schedule 4.1.

(b) Indemnification by FMLP. FMLP hereby agrees to
defend, indemnify and hold harmless Buyer and its Affiliates, and the
directors, officers and employees of Buyer and its Affiliates, from,
against and in respect of the following:

(i) any and all Losses suffered or incurred by any of
them by reason of any breached or untrue representation or warranty
of FMLP contained in this Agreement and any Proceeding incident
thereto; provided, however, that FMLP's obligation to indemnify Buyer
and its Affiliates pursuant to this Section 9.1(b)(i) shall be
limited by the following:

(A) with respect to all representations and
warranties of FMLP other than the Environmental Representations, (x)
FMLP shall have no liability under this Section 9.1(b)(i) until the
Losses suffered or incurred with respect thereto in the aggregate
exceed, and then only to the extent such Losses are in excess of,
$500,000 and (y) subject to Section 9.1(d)(iv), the liability of FMLP
under this Section 9.1(b)(i) for Losses suffered or incurred with
respect thereto shall be limited to the amount of and satisfied
solely from the Escrow Funds;

(B) with respect to the Environmental
Representations, (x) FMLP shall be liable under this Section
9.1(b)(i) for Losses from the first dollar and (y) subject to Section
9.1(d)(iv), the liability of FMLP under this Section 9.1(b)(i) for
Losses suffered or incurred with respect thereto (1) for the period
from the Closing Date until the Escrow Distribution Date (as defined
in the Escrow Agreement) shall be limited to the amount of and
satisfied solely from the Escrow Funds and (2) for the period from
the Escrow Distribution Date until the three (3) year anniversary of
the Closing Date, shall be limited to the amount required to be set
aside and maintained by FMLP in a separate bank account pursuant to
Section 9.1(e)(ii).

(ii) any and all Losses suffered or incurred by any of
them (before or after the Closing) by reason of the nonfulfillment of
any covenant or agreement by any Seller, any Other Seller,
FM-International or FM-Europe contained in this Agreement or in any
Other Purchase Agreement (including, without limitation, the payment
or performance by any Seller, any Other Seller, FM-International or
FM-Europe of the Closing Purchase
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Price Reconciliation, the Non-Assumed Liabilities or amounts owing
pursuant to Section 9.7) and any Proceeding incident thereto.

(c) Indemnification by Buyer. Buyer hereby agrees to
indemnify and hold harmless FMLP, the General Partners, the Limited
Partners and their Affiliates, and the directors, officers and
employees of FMLP, the General Partners, the Limited Partners and
their Affiliates, from, against, and in respect of:

(i) any and all Losses suffered or incurred by any of
them resulting from any breached or untrue representation or warranty
by Buyer contained in this Agreement and any Proceeding incident
thereto; or

(ii) any and all Losses suffered or incurred by any of
them resulting from the nonfulfillment of any covenant or agreement
by Buyer contained in this Agreement or in any Other Purchase
Agreement (including, without limitation, the payment and performance
by Buyer of the Assumed Liabilities) and any Proceeding incident
thereto.

(d) Notification and Defense of Claims or Actions.

(i) As used in this Section, any party seeking
indemnification pursuant to this Section is referred to as an
"indemnified party" and any party from whom indemnification is sought
pursuant to this Section is referred to as an "indemnifying party."
An indemnified party which proposes to assert the right to be
indemnified under this Section shall submit a written demand for
indemnification setting forth in summary form the facts as then known
which form the basis for the claim for indemnification. With respect
to claims based on actions by third parties, an indemnified party
shall, within fifteen (15) days after the receipt of notice of the
commencement of any Proceeding against it in respect of which a claim
for indemnification is to be made against an indemnifying party,
notify the indemnifying party in writing of the commencement of such
Proceeding, enclosing a copy of all papers served; provided, however,
that the failure to so notify the indemnifying party of any such
claim, action, suit or proceeding shall not relieve the indemnifying
party from any liability which it may have to the indemnified party,
except to the extent that the indemnifying party is prejudiced
thereby. Thereafter, the indemnified party shall deliver to the
indemnifying party, within fifteen (15) days after receipt by the
indemnified party, copies of all further notices relating to such
claim.

(ii) If a third-party claim is made for which an
indemnified party is entitled to indemnification pursuant to
Section 9.1(b) or Section 9.1(c), as the case may be, and, in the
case of Section 9.1(b), if the amount claimed pursuant to such
third-party claim, or the potential liability arising out of such
third-party claim (in the judgment of the indemnified party), does
not, after taking into account all other indemnification obligations
of the indemnifying party pursuant to Section 9.1(b), exceed the
indemnifying party's maximum
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indemnification obligation pursuant to Section 9.1(b), then the
indemnifying party shall be entitled to participate in the defense of
such claim and, if the indemnifying party so chooses, and provided
that the indemnifying party acknowledges the indemnifying party's
obligation to indemnify the indemnified party, to assume primary
responsibility for the defense of such claim with counsel selected by
the indemnifying party and not reasonably objected to by the
indemnified party. If the indemnifying party assumes the defense of
a third-party claim as set forth in this paragraph, then (A) in no
event shall the indemnified party admit any liability with respect
to, or settle, compromise or discharge, any such claim without the
indemnifying party's prior written consent and (B) the indemnified
party shall be entitled to participate in, but not control, the
defense of such claim with its own counsel at its own expense. If
the indemnifying party does not assume the defense of any such claim,
the indemnified party may defend such claim in a manner as it may
deem appropriate (including, but not limited to, settling such claim
on such terms as the indemnified party may deem appropriate).

(iii) If a third-party claim is made for which an
indemnified party is entitled to indemnification pursuant to Section
9.1(b) and if the amount claimed pursuant to such third-party claim,
or the potential liability arising out of such third-party claim (in
the judgment of the indemnified party), after taking into account all
other indemnification obligations of the indemnifying party pursuant
to Section 9.1(b), exceeds the indemnifying party's maximum
indemnification obligation pursuant to Section 9.1(b), then the
indemnified party shall be entitled to assume primary responsibility
for the defense of such claim with counsel selected by the
indemnified party and not reasonably objected to by the indemnifying
party. If the indemnified party assumes the defense of a third-party
claim as set forth in this paragraph, then (A) in no event shall the
indemnifying party admit any liability with respect to, or settle,
compromise or discharge, any such claim without the indemnified
party's prior written consent and (B) the indemnifying party shall be
entitled to participate in, but not control, the defense of such
claim with its own counsel at its own expense. If the indemnified
party does not assume the defense of any such claim, the indemnifying
party may defend such claim in a manner as it may deem appropriate
(including, but not limited to, settling such claim, after giving
twenty (20) days prior written notice of such settlement to the
indemnifying party, on such terms as the indemnifying party may deem
appropriate).

(iv) In the event that, pursuant to Section
9.1(d)(iii), the indemnified party has assumed primary responsibility
for the defense of a third-party claim, and the indemnified party
proposes to settle such third-party claim for an amount which,
after taking into account all other indemnification obligations of
the indemnifying party pursuant to Section 9.1(b), exceeds the
indemnifying party's maximum obligation pursuant to Section
9.1(b)(i), then, provided that the indemnifying party has
acknowledged the indemnifying party's obligation to indemnify the
indemnified party, the indemnified party shall give the indemnifying
party twenty (20) days prior written notice of such proposed
settlement. The indemnifying party shall notify the indemnified
party prior to the end of
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such 20-day period as to whether the indemnifying party accepts or
rejects such proposed settlement; provided, however, that
notwithstanding anything to the contrary contained in this Section
9.1, if the indemnifying party rejects the proposed settlement, the
indemnifying party shall be liable for, and shall prior to the
expiration of such 20-day period post a performance bond, letter of
credit or other similar security in an amount which equals, the
amount by which the amount claimed pursuant to such third-party claim
or, if greater, the potential liability arising out of such
third-party claim (in the good faith judgment of the indemnified
party), exceeds the proposed settlement amount.

(v) In the event that any claim for indemnification
is made with respect to any third-party claim pursuant to this
Section, (A) the party assuming primary responsibility for the
defense of such claim shall at all times keep the other party
informed as to the status of such claim and (B) the party not
primarily responsible for the defense of such claim shall cooperate
fully with the other party in connection with such defense.

(e) Obligation of FMLP to Establish and Maintain Reserve.
In order to provide further assurances to Buyer of FMLP's ability to
satisfy its obligations under Sections 9.1(b)(i) and 9.2.

(i) On the Closing Date, FMLP shall set aside in a
separate bank account $3,000,000, and shall maintain such funds free
and clear of all Encumbrances until the Escrow Distribution Date,
subject only to the following permitted uses:

(A) FMLP shall use such funds to satisfy its
obligation, if any, pursuant to Section 9.2(c) to restore the Escrow
Funds following the final determination and payment of the
Consolidated Gross Profit Adjustment; and

(B) FMLP shall use such funds to satisfy its
obligation, if any, pursuant to Section 9.2(c) to pay directly to
Buyer the portion of the Consolidated Gross Profit Adjustment which
exceeds the available Escrow Funds.

(ii) On and after the Escrow Distribution Date until
December 31, 1999, FMLP shall set aside in a separate bank account
all Escrow Funds distributed from the Escrow Account from time to
time to FMLP up to a maximum aggregate amount of $3,000,000, and
shall use such funds solely to satisfy its obligations, if any,
pursuant to Section 9.1(b)(i) to indemnify Buyer and its Affiliates
for Losses suffered or incurred with respect to breached or untrue
Environmental Representations.

(f) Indemnification Exclusive Remedy.

(i) Each of FMLP and Buyer acknowledges and agrees
that, except in the case of fraud, following the Closing its sole
remedy with respect to any and all claims
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relating to the subject matter of this Agreement and the Other
Purchase Agreements shall be pursuant to the indemnification
provisions set forth in this Section 9.1.

(ii) FMLP and Buyer acknowledge and agree that,
subject to Section 9.1(d)(iv), FMLP's maximum aggregate liability
pursuant to (A) Section 9.1(b)(i) for indemnification with respect to
breached or untrue representations and warranties and (B) Section 9.6
for the Consolidated Gross Profit Adjustment, shall in no event
exceed $13,000,000.

(iii) FMLP acknowledges and agrees that nothing
contained in Section 9.1 or elsewhere in this Agreement or any Other
Purchase Agreement shall be deemed to limit in any way FMLP's
obligation to perform, or its liability for indemnification pursuant
to Section 9.1(b)(ii) with respect to the nonfulfillment of, each
covenant and agreement of any Seller, any Other Seller,
FM-International or FM-Europe contained in this Agreement or any
Other Purchase Agreement including, without limitation, FMLP's
obligation to pay or perform any Non-Assumed Liabilities, and to
maintain the amounts required to be set aside pursuant to Section
9.1(e). Except for the obligations of FMLP pursuant to Section
9.1(b)(ii) for which the General Partners shall have liability in
their capacity as general partners of FMLP, Buyer shall have no
recourse against the General Partners or the Limited Partners for any
obligation of FMLP under this Agreement or the Other Purchase
Agreements.

9.2 Use of Escrow Funds.

(a) In the event that Buyer is entitled to indemnification
from FMLP pursuant to Section 9.1(b)(i), other than any such right to
indemnification relating to a breached or untrue Environmental
Representation arising after the expiration of the Claims Period,
Buyer shall apply to the Escrow Agent for payment of such amount out
of available Escrow Funds in accordance with the terms and conditions
of the Escrow Agreement.

(b) In the event that there is any Closing Purchase Price
Reconciliation owing from FMLP to Buyer pursuant to Section 2.5(e)
and FMLP fails to pay such amount within the five (5) business day
period specified therein, Buyer shall have the right to apply to the
Escrow Agent for payment of such amount out of available Escrow Funds
in accordance with the terms and conditions of the Escrow Agreement;
provided, however, that in the event of application of the Escrow
Funds for the payment of such Closing Purchase Price Reconciliation,
FMLP shall, within ten (10) days after such payment, deposit with
the Escrow Agent the amount required to be deposited pursuant to the
Escrow Agreement. In the event that there is any Accounts Receivable
Guarantee Amount owing from FMLP to Buyer pursuant to Section 9.7
and FMLP fails to pay such amount within the five (5) business day
period specified therein, Buyer shall have the right to apply to the
Escrow Agent for payment of such amount out of available Escrow
Funds in accordance with the

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terms and conditions of the Escrow Agreement; provided, however,
that in the event of application of the Escrow Funds for the
payment of such Accounts Receivable Guarantee Amount, FMLP shall,
within ten (10) days after such payment, deposit with the Escrow
Agent the amount required to be deposited pursuant to the Escrow
Agreement.

(c) In the event that there is any Consolidated Gross
Profit Adjustment owing from FMLP to Buyer pursuant to Section 9.6,
Buyer shall first apply to the Escrow Agent for payment of such
amount out of available Escrow Funds in accordance with the terms and
conditions of the Escrow Agreement. In the event that the amount of
the Consolidated Gross Profit Adjustment exceeds the available Escrow
Funds, then Buyer shall apply to FMLP for payment of such excess and
FMLP shall pay to Buyer the amount of such excess within five (5)
business days after the Consolidated Gross Profit Adjustment has been
finally determined pursuant to Section 9.6; provided, however, that
FMLP shall in no event be required to pay to Buyer pursuant to this
sentence an amount in excess of the $3,000,000 required to be set
aside by FMLP pursuant to Section 9(e)(i). Within ten (10) days
after any Escrow Funds are paid to Buyer pursuant to this Section
9.2(c), FMLP shall deposit with the Escrow Agent the amount, if any,
required to be deposited pursuant to the Escrow Agreement; provided,
however, that FMLP's obligation to make such a deposit with the
Escrow Agent shall in no event exceed the $3,000,000 required to be
set aside by FMLP pursuant to Section 9.1(e)(i), as such amount may
be reduced in accordance with the preceding sentence.

(d) If FMLP fails to pay (i) within the ten-day period
pursuant to subsection (b) or (c) of this Section 9.2 any amount
owing to restore the Escrow Funds or (ii) within the five-day period
pursuant to subsection (c) of this Section 9.2 any excess
Consolidated Gross Profit Adjustment owing to Buyer, then the amount
so owing shall be payable on demand and interest shall accrue on the
unpaid amount from the date due until paid at a rate equal to the
lower of (a) ten percent (10%) per annum or (b) the highest rate
permitted by law.

9.3 Use of Partnership Name or Trade Name. After the
Closing, except as required by law in connection with the liquidation
and winding up of FMLP and its Subsidiaries, neither FMLP nor its
Affiliates, will use or refer to the name "Fluid Management" or "FM"
or any trade name included within the Intellectual Property being
conveyed to Buyer, or any derivative or variation thereof or any name
similar thereto.

9.4 Continuation Health Care Coverage. On and after the
Closing, Buyer shall make available to all Qualified Individuals (as
hereafter defined) continuation health coverage under the terms and
conditions as would be required of any Seller by COBRA if such
obligations of any Seller were not being assumed by Buyer hereunder.
Buyer also shall notify, in accordance with the requirements of
COBRA, any such Qualified Individual of his or her right to obtain
continuation health coverage from Buyer. For purposes of this
Section,
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"Qualified Individual" means any employee or qualified beneficiary of
any Seller who, prior to the date of Closing or as a result of the
transactions contemplated by this Agreement, has or had incurred a
Qualifying Event (as defined by COBRA) and who has elected, or may
elect to have, health care continuation coverage under the
requirements of COBRA. Buyer further agrees that, with respect to
all former employees and qualified beneficiaries thereof of any
Seller to whom Buyer is required to provide COBRA continuation
coverage, Buyer shall, at its sole expense, also provide for coverage
of all pre-existing medical conditions of such employees and
qualified beneficiaries thereof.

9.5 Access to Records and Personnel.

(a) For a period of six (6) years after the Closing Date,
FMLP and its Representatives, shall have reasonable access to all
books and records of any FMLP Operating Entity transferred to Buyer
hereunder, and to all former employees of any FMLP Operating Entity
having knowledge with respect thereto, to the extent that such access
may reasonably be required in connection with matters relating to (i)
liabilities of any FMLP Operating Entity not assumed by Buyer
hereunder, (ii) all matters as to which FMLP is required to provide
indemnification under this Agreement or (iii) the preparation of any
tax returns required to be filed by any FMLP Operating Entity with
respect to any periods prior to the Closing. Such access shall be
afforded by Buyer upon receipt of reasonable advance notice and
during normal business hours, provided such access does not unduly
disrupt Buyer's normal business operations. FMLP shall be solely
responsible for any costs or expenses incurred by it pursuant to this
Section 9.5. If Buyer shall desire to dispose of any of such books
and records prior to the expiration of such six-year period, Buyer
shall, prior to such disposition, give FMLP a reasonable opportunity,
at FMLP's expense, to segregate and remove such books and records as
FMLP may select.

(b) For a period of six years after the Closing Date,
Buyer and its representatives shall have reasonable access to all of
the books and records relating to the Business which any FMLP
Operating Entity, or any of its or their Representatives, may retain
after the Closing Date. Such access shall be afforded by each FMLP
Operating Entity and its or their Representatives upon receipt of
reasonable advance notice and during normal business hours. Buyer
shall be solely responsible for any costs and expenses incurred by it
pursuant to this Section 9.5. If any FMLP Operating Entity shall
desire to dispose of any of such books and records prior to the
expiration of such six-year period, FMLP shall, prior to such
disposition, give Buyer a reasonable opportunity, at Buyer's expense,
to segregate and remove such books and records as Buyer may select.

9.6 Consolidated Gross Profit Adjustment.

(a) In the event that the Consolidated Gross Profit is
less than $35,500,000, then FMLP shall pay to Buyer an amount equal
to the Consolidated Gross
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Profit Adjustment. The Consolidated Gross Profit shall be equal to
(i) the Consolidated Gross Profit for the period from January 1, 1996
through the Closing Date, as reflected in the Closing Date Financial
Report plus (ii) the Consolidated Gross Profit for the period from
the Closing Date through December 31, 1996, as determined in
accordance with Section 9.6(b); provided, however, that the
Consolidated Gross Profit Adjustment shall in no event exceed the
maximum amount set forth in Section 9.2(c) and shall in no event be
less than Zero Dollars ($0.00). Within thirty (30) days after
receipt by Buyer of the audited financial statements of Buyer for the
period ended December 31, 1996, Buyer shall cause Buyer's Accountants
to prepare and deliver to FMLP a written supplemental report setting
forth the Consolidated Gross Profit for the period from the Closing
Date through December 31, 1996, the aggregate Consolidated Gross
Profit for calendar year 1996 and the Consolidated Gross Profit
Adjustment. If FMLP does not object, or otherwise fails to respond,
to Buyer's report of the Consolidated Gross Profit Adjustment within
20 days after receipt thereof by FMLP, such report and the
calculation of Consolidated Gross Profit Adjustment reflected therein
shall automatically become final and conclusive. In the event that
FMLP objects to Buyer's determination of the Consolidated Gross
Profit Adjustment within such 20-day review period, FMLP and Buyer
shall promptly meet and endeavor to reach agreement as to the content
of Buyer's report. If FMLP and Buyer agree on the Consolidated Gross
Profit Adjustment, such amount shall become final and conclusive. If
FMLP and Buyer are unable to reach agreement within 15 days after the
end of FMLP's 20-day review period, then the Independent Accountants
shall promptly be retained to undertake the determination of the
Consolidated Gross Profit Adjustment, which determination shall be
made as quickly as possible. Only disputed item(s) shall be
submitted to the Independent Accountants for review. In resolving
any disputed item, the Independent Accountants may not assign a value
to such item greater than the greatest value for such item claimed by
either party or less than the lowest value for such item claimed by
either party, in each case as presented to the Independent
Accountants. Such determination of the Independent Accountants shall
be final and binding on FMLP and Buyer, and all expenses of the
Independent Accountants shall be borne equally by FMLP and Buyer.

(b) The Consolidated Gross Profit for the period from the
Closing Date through December 31, 1996 and the Consolidated Gross
Profit Adjustment shall be determined (i) on the basis of the gross
profit of Buyer on a combined and consolidated basis to reflect the
gross profit of the Business, (ii) in a manner consistent with the
past practices and procedures employed by FMLP in the operation of
the Business (including, without limitation, the calculation of cost
of goods sold), (iii) exclusive of any accounting adjustments
resulting solely from the transactions contemplated by this Agreement
and the Other Purchase Agreements, (iv) exclusive of the effect of
any acquisitions by any FMLP Operating Entity or Buyer completed
after March 29, 1996 (including, without limitation, Co-Power
(Taiwan) and Tikurilla (Finland)) and (v) inclusive of an adjustment
necessary to reflect the effect on gross profit which would have
occurred if Buyer continued to pay rent during such period at the
same rate previously paid by FMLP to Bethesda. During the period
beginning on the
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Closing Date and ending on December 31 1996, Buyer shall, as a
condition to receiving any Consolidated Gross Profit Adjustment under
this Section 9.6, (i) operate the Business in a manner substantially
similar to and consistent with the manner in which FMLP operated the
Business prior to the Closing Date, (ii) operate and maintain the
Business as a separate business unit of Buyer substantially as
structured on the Closing Date and shall not combine the Business
with any other operating unit of Buyer and (iii) not discontinue,
sell or otherwise dispose of any material portion of the Business
except to the extent recommended or otherwise consented to by
Mitchell H. Saranow. If Buyer discontinues, sells or otherwise
disposes of any material portion of the Business with Mitchell H.
Saranow's recommendation or consent prior to December 31, 1996, then
for purposes of calculating the Consolidated Gross Profit Adjustment,
the $35,500,000 target amount shall be adjusted on a pro rata daily
basis for the period following such discontinuance, sale or other
disposition by an amount equal to the gross profit (or loss)
attributable to that portion of the Business. Furthermore, in the
event that Buyer (i) terminates the employment of Mitchell H.
Saranow without cause prior to December 31, 1996 or (ii) terminates
the employment of Leendert Hellenberg or Joseph Rygiel without cause
prior to December 31, 1996 except to the extent recommended or
otherwise consented to by Mitchell H. Saranow, Buyer shall be deemed
to have forfeited any right to receive the Consolidated Gross Profit
Adjustment. In the event of any fire, theft or other casualty to or
affecting the Business after the Closing, which casualty results in
an interruption or discontinuance of production for a period of five
(5) continuous days or more, then Buyer and FMLP shall promptly meet
and endeavor to reach agreement as to the anticipated effect of such
interruption or discontinuance on the Consolidated Gross Profit and
the Consolidated Gross Profit Adjustment; provided, however, that if
Buyer and FMLP are unable to reach agreement within thirty (30) days
after the occurrence of the casualty, then the Independent
Accountants shall be promptly retained to estimate what the
Consolidated Gross Profit would have been if such casualty had not
occurred and to calculate the Consolidated Gross Profit Adjustment
based thereon, and such estimate and the calculation based thereon
shall be final and binding upon FMLP and Buyer. In estimating what
the Consolidated Gross Profit would have been, the Independent
Accountants may not assign a value to the estimated Consolidated
Gross Profit that is greater than the greatest value claimed by
either party or less than the lowest value claimed by either party,
in each case as presented to the Independent Accountants. All
expenses of the Independent Accountants shall be borne equally by
FMLP and Buyer. Buyer shall, upon FMLP's request, provide FMLP and
its Representatives and the Independent Accountants with reasonable
access to Buyer's books and records (including, without limitation,
work papers of Buyer's Accountants) relating to the Business to the
extent necessary for the review of the calculation of the
Consolidated Gross Profit.

9.7 Collection of Accounts Receivable.

(a) As soon as reasonably possible after the Closing Date,
FMLP shall deliver to Buyer an aging report of the Accounts
Receivable. FMLP agrees on behalf of all
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FMLP Operating Entities that, on and after the Closing Date, Buyer
shall have the right and authority to collect for Buyer's account the
Accounts Receivable and to endorse with the name of "Fluid Management
Limited Partnership" or any other FMLP Operating Entity or otherwise,
as appropriate, any documents or checks received on account of or
otherwise relating to the Accounts Receivable. FMLP agrees on behalf
of all FMLP Operating Entities to execute and deliver to Buyer, upon
its request, one or more powers of attorney in form and substance
reasonably satisfactory to Buyer as evidence the foregoing agreement.
FMLP agrees on behalf of all FMLP Operating Entities that it will
forthwith transfer or deliver, or will cause any lender with which
any FMLP Operating Entity has lockbox arrangements, to transfer or
deliver to Buyer any cash or other property that any FMLP Operating
Entity or lender may receive after the Closing Date in respect of the
Accounts Receivable or any other items constituting a part of the
American Purchased Assets, the Dutch Purchased Assets, the Australian
Purchased Assets or the German Purchased Assets.

(b) FMLP guarantees the payment of the face amount of the
Accounts Receivable without reduction for any reserves. For a period
of one (1) year following the Closing Date, Buyer shall use its
reasonable efforts (not to include bringing or threatening to bring
any legal action) to collect the Accounts Receivable. After the
expiration of the one hundred twenty (120) day period following the
Closing Date, Buyer shall deliver to FMLP an aging report of the
Accounts Receivable. Subject to the second following sentence, FMLP
shall have twenty (20) days after receipt of such aging report to
elect to have Buyer assign to FMLP, without recourse, any or all of
the Accounts Receivable to the extent they remain uncollected. So
long as Buyer has not given any release impairing the right to
collect any of such uncollected Accounts Receivable, FMLP shall pay
to Buyer the full amount thereof remaining uncollected without
reduction for any reserves, whereupon FMLP, at its option, may pursue
collection of the same for its own account. Buyer may refuse to
assign to FMLP pursuant to the second preceding sentence any Account
Receivable, provided, however, that upon any such refusal, Buyer
shall be deemed to have waived its right to receive from FMLP the
full amount of such Account Receivable and FMLP shall have no further
liability under this Section with respect to such Account Receivable.
After the expiration of the one-year period following the Closing
Date, Buyer may assign to FMLP, without recourse, all Accounts
Receivable which remain uncollected other than those which Buyer has
refused to assign to FMLP pursuant to the immediately preceding
sentence. So long as Buyer has not given any release impairing the
right to collect any such uncollected Account Receivable, FMLP shall
thereupon pay to Buyer within five (5) business days the full amount
thereof remaining uncollected without reduction for any reserves
(the aggregate amount of all such uncollected Accounts Receivable
being the "Accounts Receivable Guarantee Amount"), whereupon FMLP,
at its option, may pursue collection of the same for its own
account. If and to the extent that Buyer elects not to assign any
Account Receivable to FMLP after the expiration of the one-year
period, Buyer shall be deemed to have waived its right to receive the
full amount of such Account Receivable from FMLP and FMLP shall have
no further obligation under this Section with respect to such Account
Receivable. Any
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amounts collected by Buyer on Accounts Receivable shall be applied in
the manner directed by the account debtor or, in the absence of any
direction, shall be applied first to the oldest invoice of the
account debtor. Any amounts collected by Buyer in respect of
Accounts Receivable repurchased by FMLP shall forthwith be remitted
to FMLP by Buyer.

9.8 Buyer's Contribution to FMLP's Profit Sharing Plan.
Buyer shall make or cause to be made to the Fluid Management Profit
Sharing and Savings Plan for the plan year ending December 31, 1996,
an employer profit sharing contribution in an amount not less than 7%
of each eligible participant's compensation (as defined in the plan)
for that plan year.

9.9 Buyer's Continuation of FMLP's Bonus Plan. For the
period from the Closing Date through December 31, 1996, Buyer shall
maintain and administer FMLP's bonus compensation plan as in effect
prior to the Closing Date with respect to all employees formerly
employed by FMLP or its Subsidiaries and eligible for bonuses under
such plan, and otherwise in a manner consistent with past practice of
FMLP. Buyer and FMLP agree that (i) with respect to the period from
January 1, 1996 through the Closing Date, such bonuses shall be equal
to the amount accrued on the Closing Date Financial Report, (ii) with
respect to the period from the Closing Date through December 31,
1996, Buyer shall pay additional bonus amounts on a pro rata basis
based on actual levels of operation versus targeted levels of
operation of the Business and otherwise consistent with past
practice.

9.10 Buyer's Obligation to Honor FMLP's Vacation Benefits.
Buyer shall provide to former employees of FMLP or its Subsidiaries
who accept employment with Buyer all vacation benefits earned in
accordance with FMLP's vacation policy through the Closing Date.

9.11 Product Liability After the Closing. For a period of
five (5) years following the Closing Date, Buyer shall have FMLP and
its Subsidiaries named as an additional insured on any policies of
product liability insurance maintained by Buyer with respect to
occurrences after the Closing Date both for products sold by any FMLP
Operating Entity before the Closing Date and products sold by Buyer
in the operation of the Business after the Closing Date. Any Loss
(whoever asserted against) arising out of such occurrences, shall not
be deemed to be a liability of FMLP or any FMLP Operating Entity not
acquired by Buyer and their existence or occurrence shall not
constitute a breach of any representation or warranty of FMLP
contained in this Agreement.

9.12 Seller's Obligation to Remediate Contamination. FMLP
will promptly cause to be engineered, installed and operated
remediation systems to remove the TCE contamination in soil and/or,
as applicable, groundwater at the Wheeling Real Property identified
by Conestoga-Rovers & Associates in their reports on or prior to the
date of this Agreement and summarized in the letter from
Conestoga-Rovers & Associates to Rick
<PAGE> 57

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Kennedy dated July 26, 1996 (Reference No. 8620), which systems shall
essentially conform to the soil vapor extraction and groundwater
extraction and treatment systems described in said letter from
Conestoga-Rovers & Associates to Rick W. Kennedy dated July 26, 1996
(Reference No. 8620). The selection and design of the systems shall
be in FMLP's sole reasonable discretion. FMLP shall, in good faith,
consult with and seek the concurrence of the Buyer before making
final decisions concerning the remedial systems to be employed. The
TCE contamination must be remediated in accordance with, and in
satisfaction of the requirements of any applicable Environmental Laws
and any Governmental Authority having jurisdiction of the matter.
FMLP shall perform the remedial activities pursuant to the Site
Investigation and Remedial Activities Program set forth at 415 ILCS
5/58.3 et seq. FMLP shall operate the remediation systems until the
rate of contaminant removal becomes asymptotic, or for a period of
eighteen (18) months after commencing such remediation, whichever
comes first. Provided, however, FMLP must, at the end of the
relevant period, obtain and supply to Buyer written evidence (the
"IEPA No Further Remediation Letter") that the Illinois Environmental
Protection Agency ("IEPA") has reviewed all relevant information and
concluded that the systems need not be operated any longer and that
no further remediation is necessary. The IEPA may require
institutional controls. Upon receipt of the IEPA No Further
Remediation Letter, FMLP's obligations will cease and Buyer agrees to
accept any institutional controls imposed by IEPA or any other
Governmental Authority having jurisdiction. If FMLP does not obtain
such a letter from IEPA, it must continue to operate the system,
and/or, at its sole option, take such other actions as are necessary,
until such an assurance is obtained. Buyer shall grant FMLP access
to the Facility for the purpose of carrying out any necessary
remedial work. The remedial work shall minimize, to the maximum
extent practicable, any interference with Buyer's occupancy and use
of the Facility. The Buyer will decide, in its reasonable
discretion, whether the remedial work minimizes, to the maximum
extent practicable, any interference with the Buyer's occupancy and
use of the Facility.

ARTICLE 10
MISCELLANEOUS

10.1 Further Assurances. Both before and after the Closing
Date, each party will cooperate in good faith with each other party
and will take all appropriate action and execute any agreement,
instrument or other writing of any kind which may be reasonably
necessary or advisable to carry out and confirm the transactions
contemplated by this Agreement (including, but not limited to,
obtaining consents or approvals from any Person for the transfer of
the American Purchased Assets, the FM-Service Shares and the
FM-Brazil Shares that are transferred subject to consents or
approvals being obtained).

10.2 Risk of Loss. Risk of loss with respect to any of the
property or assets of FMLP or its Subsidiaries shall be borne by FMLP
or its Subsidiaries at all times prior to the Closing and shall pass
to Buyer only upon transfer to Buyer at Closing of title to (i) the
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American Purchased Assets, the FM-Service Shares, the FM-Brazil
Shares and the FM-Germany Shares, (ii) the Wheeling Real Property,
(iii) the Dutch Purchased Assets, the FM-U.K. Shares, the FM-Spain
Shares and the FM-Sweden Shares and (iv) the Australian Purchased
Assets. If any of the Current Real Property (including Bethesda's
fee interest in the Wheeling Real Property), the Tangible Personal
Property or the Inventory is lost, damaged or destroyed by fire,
theft, casualty or any other cause or causes prior to the Closing (a
"Casualty"), FMLP shall promptly notify Buyer in writing of such
Casualty and the details thereof and shall answer promptly any
reasonable requests from Buyer for details or information. Buyer
shall thereafter proceed with the Closing, except that in the event
of a Casualty to the Current Real Property (including Bethesda's fee
interest in the Wheeling Real Property), the Tangible Personal
Property or the Inventory, the American Purchase Price, the German
Purchase Price, the Dutch Purchase Price or the Australian Purchase
Price, or the Bethesda Purchase Price as the case may be, shall be
reduced by the dollar amount (based upon replacement value) of the
Casualty loss (and any insurance proceeds received or receivable as a
result of such Casualty shall be payable to FMLP); provided, however,
that if such Casualty(ies) are in an aggregate amount in excess of
$5,000,000 from the date of this Agreement through the Closing Date
or materially interfere, in Buyer's reasonable discretion, with the
operation of the Business, Buyer may terminate this Agreement. The
aforesaid option shall be exercised by Buyer by written notice to
FMLP given within fifteen (15) days or the number of days remaining
to the Closing, whichever is less, after the later of Buyer receiving
(i) written notice of such Casualty and (ii) satisfactory responses
to all of its reasonable requests, if any, for details or
information. If this Agreement is not terminated by Buyer pursuant
to this Section and if Buyer and FMLP are unable to agree as to the
dollar amount of the loss (based upon replacement value) or the
insurance proceeds to be recovered, Buyer, Sellers and the Other
Sellers shall proceed with the Closing as scheduled, except that
Buyer shall pay to the Escrow Agent (to be held in a separate account
pending agreement as to the final amount) an additional amount (based
upon estimated replacement value) as determined by a firm selected by
the Independent Accountants (the "Casualty Amount") and the payments
to be made by Buyer on the Closing Date pursuant to this Agreement
and the Other Purchase Agreements shall be reduced by the Casualty
Amount. The Escrow Agent shall hold the Casualty Amount until the
dispute has been resolved following the Closing either by agreement
of Buyer and FMLP or otherwise. In the event that the actual
Casualty loss is greater than or less than the Casualty Amount held
in escrow, to the extent necessary, the parties shall make
appropriate adjustment payments.

10.3 Termination. This Agreement may be terminated at any
time prior to the Closing Date as follows:

(a) By written agreement of Buyer and FMLP;

(b) By Buyer or FMLP by written notice to the other in the
event that the Closing Date has not occurred for any reason on or
prior to October 31, 1996, but only if
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the terminating party is not in breach of, or default under, any
provision of any of this Agreement;

(d) By Buyer by written notice to FMLP of its election to
terminate this Agreement pursuant to Section 10.2;

(e) Automatically upon termination of any of the Other
Purchase Agreements in accordance with its terms.

Except as otherwise specifically provided in Section 6.5 and Section
10.12, in the event of the termination of this Agreement by any party
as provided in the preceding sentence, no party shall have any
liability hereunder of any nature whatsoever, other than for
indemnification pursuant to Section 9.1. In the event that a
condition precedent to its obligations is not satisfied, nothing
contained in this Agreement shall be deemed to require any party to
terminate this Agreement, rather than to waive such condition
precedent and proceed with the Closing, which waiver shall not impair
or affect any right of indemnification or other right or remedy
hereunder.

10.4 Notices. Unless otherwise provided in this Agreement,
any agreement, notice, request, instruction or other communication to
be given hereunder by any party to the other shall be in writing and
(i) delivered personally, (ii) mailed by certified mail, postage
prepaid (such mailed notice to be effective four days after the date
it is mailed) or (iii) sent by facsimile transmission, with a
confirmation sent by way of one of the above methods, as follows:

If to any Seller addressed to:

Fluid Management Limited Partnership
860 Auburn Road
Winnetka, Illinois 60093
Attn: Mitchell H. Saranow
Telephone: (847) 501-3045
Telecopier: (847) 501-3049
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With copies to:

McDermott, Will & Emery
227 West Monroe Street
Chicago, Illinois 60606
Attn: Neal White, Esq.
Telephone: (312) 984-7579
Telecopier: (312) 984-3669

Sidley & Austin
One First National Plaza
Suite 4000
Chicago, Illinois 60603
Attn: John J. Sabl, Esq.
Steven Sutherland, Esq.
Telephone: (312) 853-7567
Telecopier: (312) 853-7036

and:

Gould & Ratner
222 North LaSalle Street
8th Floor
Chicago, Illinois 60601
Attn: Fred Tannenbaum, Esq.
Telephone: (312) 899-1613
Telecopier: (312) 236-3241

If to Buyer, addressed to:

IDEX Corporation
630 Dundee Road, Suite 400
Northbrook, Illinois 60062
Attn: Donald N. Boyce
Wayne P. Sayatovic
Telephone: (847) 498-7070
Telecopier: (847) 498-9123

<PAGE> 61
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With a copy to:

Hodgson, Russ, Andrews, Woods & Goodyear, LLP
Attn: Richard E. Heath, Esq.
David V.L. Bradley, Esq.
Frank J. Notaro, Esq.
1800 One M & T Plaza
Buffalo, New York 14203
Telephone: (716) 856-4000
Telecopier: (716) 849-0349

Any party may designate in a writing to any other party any other
address or telecopier number to which, and any other Person to whom
or which, a copy of any such notice, request, instruction or other
communication should be sent.

10.5 Knowledge. For purposes of this Agreement,
"knowledge", "information" or "belief" with respect to FMLP shall
mean (except as otherwise provided in this sentence) the actual
knowledge, information or belief, as appropriate to the context of
the statement in which the term is used, of (i) with respect to the
American Business, the Australian Business, Bethesda and the Wheeling
Real Property, each of Mitchell H. Saranow, Thomas Carney, Joseph
Rygiel and Michael Kudia, (ii) with respect to the Dutch Business and
the German Business, each of Mitchell H. Saranow, Thomas Carney,
Leendert Hellenberg and John Farla, or the knowledge, information or
beliefs which such individuals would have after having made a review
of documents of a date not more than three (3) years old in files
under his immediate personal control, with respect to the matters
which are relevant to the representation, warranty, covenant or
agreement being made or given.

10.6 Public Statements. Buyer and FMLP agree to cooperate,
both prior to and after the Closing, in issuing any press releases or
otherwise making public statements with respect to the transactions
contemplated by this Agreement and the Other Purchase Agreements
(including any statements to employees of any FMLP Operating Entity)
and no press release or other public statements shall be issued
without the joint consent of Buyer and FMLP; provided, however that
Buyer may issue press releases or make public statements without
FMLP's consent to the extent Buyer's counsel advises is required by
law or the rules of the New York Stock Exchange as applicable to
Buyer, so long as Buyer gives FMLP an opportunity to review such
press release or public statement before its release.

10.7 Choice of Law. This Agreement shall be construed,
interpreted and the rights of the parties determined in
accordance with the laws of the State of Illinois without regard to
principles of conflicts of law, except that, with respect to matters
of law concerning the internal corporate affairs of any corporate
entity which is a party to or the subject of this
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Agreement, the law of the jurisdiction under which the respective
entity was organized shall govern.

10.8 Expenses. Except as otherwise provided in this
Agreement, FMLP shall pay all legal, accounting and other expenses of
FM-International, FM-Europe and any FMLP Operating Entity or Bethesda
incident to this Agreement or the Other Purchase Agreements and Buyer
shall pay all legal, accounting and other expenses of Buyer incident
to this Agreement or the Other Purchase Agreements. Except as
otherwise provided in this Agreement, nothing contained in this
Agreement shall be interpreted or construed to require Buyer to
directly or indirectly pay, assume or be liable for any of the
foregoing expenses of FM-International, FM-Europe and any FMLP
Operating Entity or Bethesda.

10.9 Titles. The headings of the articles and sections of
this Agreement are inserted for convenience of reference only, and
shall not affect the meaning or interpretation of this Agreement.

10.10 Waiver. No failure of any party to this
Agreement to require, and no delay by any party to this Agreement in
requiring, any other party to comply with any provision of this
Agreement shall constitute a waiver of the right to require such
compliance. No failure of any party to this Agreement to exercise,
and no delay by any party to this Agreement in exercising, any right
or remedy under this Agreement shall constitute a waiver of such
right or remedy. No waiver by any party to this Agreement of any
right or remedy under this Agreement shall be effective unless made
in writing. Any waiver by any party to this Agreement of any right
or remedy under this Agreement shall be limited to the specific
instance and shall not constitute a waiver of such right or remedy in
the future.

10.11 Effective; Binding. This Agreement shall be
effective upon the due execution hereof by each party to this
Agreement and the due execution by Mitchell H. Saranow of the
agreement set forth at the end of this Agreement. Upon becoming
effective, this Agreement shall be binding upon each party to this
Agreement and upon each successor and assignee of each party to this
Agreement and shall inure to the benefit of, and be enforceable by,
each party to this Agreement and each successor and assignee of each
party to this Agreement; provided, however, that, except as provided
for in the following sentence, no party to this Agreement shall
assign any right or obligation arising pursuant to this Agreement
without first obtaining the written consent of the other parties.
Buyer may assign all or a portion of its rights and obligations under
this Agreement to one or more Affiliates of Buyer, provided that
Buyer shall remain liable hereunder notwithstanding any such
assignment.

10.12 Entire Agreement. Except for the provisions of
the letter agreement dated May 31, 1996, by and among FMLP, Buyer and
others (the "Letter Agreement") relating to payment by FMLP of a
"break-up fee", this Agreement, together with the
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Confidentiality Agreement between FMLP and Buyer, and the
Indemnification and Confidentiality Agreement between FMLP and Buyer,
contains the entire agreement between the parties to this Agreement
with respect to the subject matter of this Agreement and supersedes
each course of conduct previously pursued, accepted or acquiesced in,
and each written or oral agreement and representation previously
made, by the parties to this Agreement with respect to the subject
matter of this Agreement.

10.13 Modification. No course of performance or other
conduct hereafter pursued, accepted or acquiesced in, and no oral
agreement or representation made in the future, by any party to this
Agreement, whether or not relied or acted upon, and no usage of
trade, whether or not relied or acted upon, shall modify or terminate
this Agreement, impair or otherwise affect any obligation of any
party pursuant to this Agreement or otherwise operate as a waiver of
any such right or remedy. No modification of this Agreement or
waiver of any such right or remedy shall be effective unless made in
writing duly executed by the parties to this Agreement.

10.14 Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original
and all of which taken together shall constitute one and the same
instrument. Any party may execute this Agreement by facsimile
signature and the other party shall be entitled to rely on such
facsimile signature as evidence that this Agreement has been duly
executed by such party. Any party executing this Agreement by
facsimile signature shall immediately forward to the other party an
original signature page by overnight mail.

10.15 Consent to Jurisdiction. Each party to this
Agreement hereby (i) consents to the jurisdiction of the United
States District Court for the Northern District of Illinois or, if
such court does not have jurisdiction over such matter, the
applicable state court in the State of Illinois, County of Cook and
(ii) irrevocably agrees that all actions or proceedings arising out
of or relating to this Agreement shall be litigated in such court.
Each party to this Agreement accepts for itself and in connection
with its properties, generally and unconditionally, the exclusive
jurisdiction and venue of the aforesaid courts and waives any defense
of forum nonconvenience or any similar defense, and irrevocably
agrees to be bound by any non-appealable judgment rendered thereby in
connection with this Agreement.

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IN WITNESS WHEREOF, the parties to this Agreement have caused this
Agreement to be executed on the day and year indicated at the beginning of this
Agreement.

IDEX CORPORATION

By: /S/ Donald N. Boyce
---------------------------------
Donald N. Boyce
Chief Executive Officer

FLUID MANAGEMENT LIMITED
PARTNERSHIP

By: Fluid Management Inc.,
Managing General Partner

By: /S/ Mitchell H. Saranow
---------------------------------
Mitchell H. Saranow
Chairman

By: Addison Paint Equipment Corp.,
General Partner

By: /S/ A. Steven Crown
---------------------------------
A. Steven Crown
President

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FLUID MANAGEMENT U.S., LLC

By: Fluid Management Service, Inc.
Member

By: /S/ Mitchell H. Saranow
---------------------------------
Mitchell H. Saranow
President

By: Fluid Management Limited
Partnership,
Member

By: Fluid Management Inc.
Managing General Partner

By: /S/ Mitchell H. Saranow
----------------------------
Mitchell H. Saranow
Chairman

By: Addison Paint Equipment Corp.
General Partner

By: /S/ A. Steven Crown
----------------------------
A. Steven Crown
President

FM INTERNATIONAL, INC.

By: /S/ Mitchell H. Saranow
---------------------------------
Mitchell H. Saranow
President

<PAGE> 66

-60-

FLUID MANAGEMENT EUROPE B.V.

By: /S/ Mitchell H. Saranow
---------------------------------
Mitchell H. Saranow
Managing Director

FLUID MANAGEMENT SERVICE, INC.

By: /S/ Mitchell H. Saranow
---------------------------------
Mitchell H. Saranow
President

FLUID MANAGEMENT CANADA LLC

By: FM International, Inc.
Member

By: /S/ Mitchell H. Saranow
---------------------------------
Mitchell H. Saranow
President

By: Fluid Management Limited
Partnership,
Member

By: Fluid Management Inc.
Managing General Partner

By: /S/ Mitchell H. Saranow
----------------------------
Mitchell H. Saranow
Chairman

<PAGE> 67

-61-

By: Addison Paint Equipment Corp.
General Partner

By: /S/ A. Steven Crown
----------------------------
A. Steven Crown
President

FLUID MANAGEMENT FRANCE SNC

By: Fluid Management Europe B.V.
Managing Partner

By: /S/ Mitchell H. Saranow
---------------------------------
Mitchell H. Saranow
Managing Director

By: Fluid Management Limited Partnership
Partner

By: Fluid Management Inc.
Managing General Partner

By: /S/ Mitchell H. Saranow
----------------------------
Mitchell H. Saranow
Chairman

By: Addison Paint Equipment Corp.
General Partner

By: /S/ A. Steven Crown
----------------------------
A. Steven Crown
President

<PAGE> 68

-62-

By signing below, Mitchell H. Saranow does not become a
party to this Agreement, but evidences only his agreement with FMLP
and Buyer to execute and deliver on the Closing Date the Employment
Agreement and IDEX's standard form of Standards of Conduct and
Business Ethics Policy and Employee Inventions and Proprietary
Information Agreement.

/S/ Mitchell H. Saranow
-------------------------------
Mitchell H. Saranow

<PAGE> 69

SCHEDULE 1.1(g)

AMERICAN NON-ASSUMED CONTRACTS

Joint Venture and Acquisition Agreements

1. Agreement, dated July 6, 1993, among FMLP, Strastint
International Limited Partnership, FM-U.K., Basclan
International Pty. Ltd. and others.

2. Obligations of Sellers to make payments under the Non-
Competition and Confidentiality Agreement, dated July 6, 1993,
among FMLP, Strastint International Limited Partnership,
FM-U.K., Basclan International Pty. Ltd. and other parties
thereto, except that Sellers shall assign to Buyer all rights
and benefits under such Agreement.

3. Consulting Agreement, dated July 6, 1993, between Shelia Pty.
Ltd., as trustee of Basclan Management Trust, FM- Australia,
William A. Somers, Stephen F. Exell and Grayem Forrest.

4. Promissory Note in the principal amount of $700,000 issued by
FM-U.K. to Texicon Ltd.

5. Obligations of Sellers to make payments to Ateliers Sussmeyer
S.A. or Robert Sussmeyer pursuant to any of the following:

a. Acquisition Agreement dated as of September 23, 1992,
between FM-Holland, FMLP and Ateliers Sussmeyer S.A.

b. Manufacturing and Servicing Agreement dated as of September
23, 1992, between FM-Holland, FMLP and Ateliers Sussmeyer,
S.A.

c. Non-Competition and First Offer Agreement executed by
Ateliers Sussmeyer S.A. and Robert Sussmeyer.

d. Consulting Agreement executed by Robert Sussmeyer.

6. Mutual Non-Disclosure Agreement between Fluid Management L.P.
and X-Rite Incorporated dated July 1, 1994.
<PAGE> 70

-2-

Real Property Leases

All leases between Bethesda and FMLP including but not limited to the
following:

1. Net Lease, dated January 31, 1992 between Bethesda and FMLP.

2. First Amendment to Amended and Restated Net Lease, dated June 1,
1994, between Bethesda and FMLP.

3. Second Amendment to Net Lease, dated July 1, 1993, between
Bethesda and FMLP.

Credit Facilities

1. Amended and restated Credit Agreement, dated September 29, 1995,
between FMLP and Bank of America Illinois as agent and other
financial institutions thereto.

2. Security Agreement, dated April 8, 1994, between FMLP and
Continental Bank N.A.

3. Company Pledge Agreement, dated April 8, 1994, between FMLP and
Continental Bank N.A.

4. Patent Security Agreement, dated April 8, 1994, between FMLP and
Continental Bank N.A.

5. Mortgage of Patents, dated April 8, 1994, between FMLP and
Continental Bank N.A.

6. Deed of Assignment, not dated, between FMLP and Bank of America
Illinois.

7. Security Agreement (Assignment of Partnership Interests), dated
April 8, 1994 between FMLP and Continental Bank N.A.

8. Form of Assignment Agreement, dated September 29, 1995, between
FMLP and Bank of America Illinois.

9. Receivables and Claims Security Agreement, dated April 8, 1994,
between FMLP and Continental Bank N.A.

10. Reimbursement obligation with respect to the Letter of Credit
issued by The First National Bank of Chicago to accommodate the
Strastint purchase, effective July 6, 1993 in the amount of
$1,700,000 (AUS).
<PAGE> 71

-3-

Guarantees

1. Continuing Guaranty for Business Credit Obligations dated April
13, 1993 in favor of Bank One by FMLP for Bethesda's obligations
under that certain Commercial Mortgage Note for $3,325,000 dated
April 13, 1993 of Bethesda in favor of Bank One.

Foreign Exchange Forwards, Options and Swaps

1. FMLP options and forward contracts.

2. ISDA Master Agreement dated November 21, 1994 between FMLP and
Bank of America National Trust and Savings Association.

3. Confirmation between FMLP and Bank of America National Trust and
Savings Association dated December 2, 1994 regarding a USD
8,000,000 swap transaction.

Mortgage and Related Documents

1. Letter Agreement for Additional Loan of $105,000 dated June 7,
1993 by and between Bank One, Chicago, Bethesda and FMLP.

2. Mortgage Modification Agreement, dated June 7, 1993, by and
between Bethesda, Bank One, Chicago and FMLP.

3. Subordination Agreement of Lease, dated April 13, 1993, by FMLP
and Bank One, Chicago.

4. Non-Disturbance and Attornment Agreement, dated April 13, 1993,
by and among FMLP, Bank One and Bethesda Investors, L.P.
<PAGE> 72

SCHEDULE 1.1(h)

AMERICAN NON-ASSUMED EMPLOYEE BENEFIT PLANS

Fluid Management Limited Partnership Phantom Equity Plan
<PAGE> 73

SCHEDULE 1.1(bq)

GERMAN NON-ASSUMED EMPLOYEE BENEFIT PLANS

[None]
<PAGE> 74

SCHEDULE 1.1(bt)

GERMAN NON-ASSUMED CONTRACTS
<PAGE> 75

SCHEDULE 2.3

ALLOCATION OF PURCHASE PRICE

(See Attached)
<PAGE> 76

SCHEDULE 4.1

REPRESENTATIONS AND WARRANTIES
RELATING TO THE AMERICAN BUSINESS

(a) Organization, Subsistence and Authority of FMLP
Operating Entities to Conduct Business. Each FMLP Operating Entity
is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization. The Disclosure
Schedule sets forth the jurisdiction of organization of each FMLP
Operating Entity and each jurisdiction where any FMLP Operating
Entity is qualified to do business. Each FMLP Operating Entity is
duly qualified to do business in, and is in good standing under the
laws of, each jurisdiction in which such qualification is necessary
under the applicable law as a result of the conduct of the Business.
Each FMLP Operating Entity has full partnership or corporate power
and authority to conduct its business as it is presently being
conducted and to own and lease its properties and assets. Except as
set forth on the Disclosure Schedule, no FMLP Operating Entity has
any stock or equity interest in any corporation, firm or any other
Person.

(b) Power and Authority; Authorization; Binding Effect.
Each of FM-International, FM-Europe and each FMLP Operating Entity
which is a party to this Agreement has all necessary power and
authority and has taken all action necessary to authorize, execute
and deliver this Agreement, to consummate the transactions
contemplated by this Agreement, and to perform its obligations under
this Agreement. The General Partners are the only general partners
of FMLP and each General Partner has all necessary power and
authority and has taken all action necessary to execute and deliver
this Agreement. No consent or other action of the Limited Partners
is required for FMLP to execute and deliver this Agreement, to
consummate the transactions contemplated by this Agreement or to
perform its obligations under this Agreement. Copies of all
resolutions of the board of directors of each General Partner with
respect to the transactions contemplated by this Agreement, certified
by the Secretary or an Assistant Secretary of such General Partner,
in form reasonably satisfactory to counsel for Buyer, have been
delivered to Buyer. This Agreement has been duly executed and
delivered by FM-International, FM-Europe and each FMLP Operating
Entity which is a party hereto and constitutes a legal, valid and
binding obligation of FM-International, FM-Europe and each such FMLP
Operating Entity enforceable against FM-International, FM-Europe and
each such FMLP Operating Entity in accordance with its terms, except
as such enforcement may be limited by the Enforceability Limitations.

(c) No Conflict or Violation. The execution and delivery
of this Agreement, the consummation of the transactions contemplated
by this Agreement, and the fulfillment of the terms of this
Agreement, do not and will not result in or constitute (i) a
violation of or conflict with any provision of the organizational or
other governing documents of FM-International, FM-Europe or any FMLP
Operating Entity, (ii) except as set forth on the Disclosure
Schedule, a breach of, a loss of rights under, or constitute an
event,
<PAGE> 77
-2-

occurrence, condition or act which is or, with the giving of notice
or the lapse of time, would become, a material default under, or
result in the acceleration of any obligations under, any term or
provision of, any Material Contract, Encumbrance or material Permit
to which FM-International, FM-Europe or any FMLP Operating Entity is
a party, (iii) a material violation by FM-International, FM-Europe or
any FMLP Operating Entity of any statute, rule, regulation,
ordinance, code, order, judgment, writ, injunction, decree or award
applicable to FM-International, FM-Europe or any FMLP Operating
Entity or (iv) an imposition of any Encumbrance (other than a
Permitted Encumbrance) on the American Purchased Assets, the
FM-Service Shares or the FM-Brazil Shares.

(d) Consents and Approvals. Except for any filings
required under the HSR Act which have been completed and with respect
to which early termination of the waiting period has been granted,
and as otherwise as set forth on the Disclosure Schedule, no consent,
approval or authorization of, or declaration, filing or registration
with, any Person is required to be made or obtained by
FM-International, FM-Europe or any FMLP Operating Entity in
connection with the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated by
this Agreement.

(e) No Proceedings. There is no Proceeding pending or, to
the knowledge of FMLP, threatened in writing against or relating to
the transactions contemplated by this Agreement.

(f) Capitalization of FM-Service and FM-Brazil. The
Disclosure Schedule sets forth the authorized, issued and outstanding
capital stock of FM-Service and FM-Brazil, the ownership thereof and
any Encumbrances thereon. Except as set forth on the Disclosure
Schedule, (i) there are no securities of either of FM-Service or
FM-Brazil convertible into or exchangeable or exercisable for shares
of its capital stock, (ii) there are no bonds, debentures, notes, or
other indebtedness having the right to vote on any matters on which
FM-Service's or FM-Brazil's shareholders may vote, (iii) there are no
outstanding options, warrants, rights, contracts, commitments,
understandings or arrangements by which FM-Service or FM-Brazil is
bound to issue, repurchase or otherwise acquire or retire any of its
securities and (iv) there are no voting agreements, voting trusts,
buy-sell agreements, options or rights or obligations relating to the
shareholders or the securities of FM-Service or FM-Brazil.

(g) Corporate Records. The minute books of each of
FM-Service and FM-Brazil contain a complete and accurate record of
all material meetings and actions of shareholders and
directors of such corporation, and of any executive committee or
other committee of the shareholders or board of directors of such
corporation. The stock record book of each of FM-Service and
FM-Brazil is complete and accurate and contains a complete and
accurate record of all share transactions for such corporation from
the date of its incorporation. The minute books and stock record
books (or partnership equivalents) of
<PAGE> 78

-3-

FM-International, FM-Europe and all FMLP Operating Entities other
than FM-Service and FM-Brazil have been made available to Buyer for
its review and contain a complete and accurate record of all material
meetings of shareholders, directors, partners, members or other
appropriate governing bodies, as the case may be.

(h) Financial Statements; Unknown Liabilities. FMLP has
delivered to Buyer the Financial Statements and the Interim Financial
Statements. The Financial Statements fairly present the financial
condition and the results of operations of FMLP and its Subsidiaries
as of their respective dates and for the periods then ended in
accordance with GAAP applied on a consistent basis. The Interim
Financial Statements fairly present the financial condition and the
results of operations of FMLP and its Subsidiaries as of their
respective dates and for the periods then ended in accordance with
GAAP, except for normal year-end adjustments, the absence of footnote
disclosures and other routine differences between audited and monthly
unaudited financial statements. The books and records of FMLP and
its Subsidiaries from which the Financial Statements and the Interim
Financial Statements were prepared fairly reflect in all material
respects the assets, liabilities and operations of FMLP and its
Subsidiaries and the Financial Statements and the Interim Financial
Statements are in conformity therewith. Except as disclosed on the
Disclosure Schedule, there are, and as of the Closing Date there will
be, no liabilities or obligations of any nature, whether absolute,
accrued, contingent, known, unknown, matured, unmatured or otherwise,
and whether or not required to be disclosed or provided for in
financial statements in accordance with GAAP, of any FMLP Operating
Entity or Bethesda except (i) liabilities and obligations reflected
or reserved for in the Financial Statements and the Interim Financial
Statements (including liabilities relating to items disclosed in the
notes thereto), (ii) the Accrued Liabilities , (iii) the Accounts
Payable, (iv) the Material Contracts set forth on the Disclosure
Schedule and the Minor Contracts, (v) the Assumed Employee Benefit
Plans, (vi) liabilities relating to facts, circumstances or events
specifically disclosed (including those reflected on the Disclosure
Schedule) in this Agreement, (vii) liabilities relating to the
Permitted Encumbrances, (viii) the Non-Assumed Liabilities, (ix)
liabilities subject to coverage and to the extent covered under the
Assumed Insurance, (x) liabilities reflected in the calculation of
the Purchase Price Closing Adjustment and the Consolidated Gross
Profit Adjustment as finally determined, (xi) liabilities of which
Buyer has actual knowledge and of which FMLP does not have knowledge
as described in Section 9.1(a)(i), (xii) liabilities and obligations
incurred between May 31, 1996 and the Closing Date in the ordinary
course of the business of FMLP and its Subsidiaries (excluding
acquisitions) and (xiii) actual real estate taxes pro-ated through
the Closing Date and actual covered medical expenses under The
Saranow Companies Health Care Plan incurred through the Closing
Date, consistent with past practice, and as permitted by this
Agreement. Except as set forth on the Disclosure Schedule, all
assets and properties of any FMLP Operating Entity to be acquired by
Buyer pursuant to this Agreement and the Other Purchase Agreements
are free and clear of any Encumbrances.
<PAGE> 79

-4-

(i) Tax Matters.

(i) Except as set forth on the Disclosure Schedule,
to the knowledge of FMLP, (A) each FMLP Operating Entity has filed
all Tax Returns that it was required to file, (B) all Taxes required
to have been withheld in connection with amounts paid or owing to any
employee, independent contractor, creditor, stockholder or other
third party have been withheld, (C) all such Tax Returns were correct
and complete in all material respects, (D) all Taxes required to have
been paid by any FMLP Operating Entity (whether or not shown on any
Tax Return) have been paid, (E) no FMLP Operating Entity is currently
the beneficiary of any extension of time within which to file any Tax
Return and (F) no claim has been made within the last five (5) years
by any Governmental Authority in a jurisdiction where any FMLP
Operating Entity does not file Tax Returns that it is or may be
subject to taxation by that jurisdiction. There are no Encumbrances
(other than Permitted Encumbrances) on any of the American Purchased
Assets, the FM-Service Shares or the FM-Brazil Shares that arose in
connection with any failure (or alleged failure) to pay any Tax.

(ii) To the knowledge of FMLP, no Governmental
Authority will assess any additional Taxes for any period for which
Tax Returns have been filed. There is no dispute or claim concerning
any Tax liability of any FMLP Operating Entity either (A) claimed or
raised by any Governmental Authority in writing or (B) as to which
FMLP has knowledge based upon personal contact with any agent of such
authority. The Disclosure Schedule lists all federal, state, local,
and foreign income Tax Returns filed with respect to any FMLP
Operating Entity for taxable periods ended on or after December 31,
1992, indicates those Tax Returns which have been audited, and
indicates those Tax Returns that currently are the subject of audit.
FMLP has delivered to Buyer correct and complete copies of all
federal income Tax Returns, examination reports, and statements of
deficiencies assessed against or agreed to by any FMLP Operating
Entity for taxable periods ended on or after December 31, 1992.

-5-

request of any FMLP Operating Entity for the Current Real Property
for which a mechanic's or materialman's lien or liens, or any other
lien, has been claimed by any Person on any FMLP Operating Entity's
interest in the Current Real Property, except to the extent that the
liability relating thereto is reflected on the Closing Date Financial
Report, (vi) the Current Real Property, and each user thereof, is in
compliance in all material respects with all applicable Governmental
Requirements and (vii) no material default or breach exists with
respect to any Encumbrance affecting any FMLP Operating Entity's
interest in the Current Real Property. There are no condemnation or
eminent domain proceedings pending or, to the knowledge of FMLP,
contemplated or threatened against any FMLP Operating Entity's
interest in the Current Real Property or any part thereof, and no
FMLP Operating Entity knows of any desire of any Governmental
Authority to take or use any FMLP Operating Entity's interest in the
Current Real Property or any part thereof. Except as set forth on
the Disclosure Schedule, there are no existing or, to the knowledge
of FMLP, contemplated or threatened general or special assessments
against any FMLP Operating Entity's interest in the Current Real
Property or any portion thereof. FMLP does not have any knowledge of
any pending or threatened Proceeding before any Governmental
Authority which relates to the ownership, maintenance, use or
operation of any FMLP Operating Entity's interest in the Current Real
Property (other than periodic general reassessments, which
reassessments, if any, are set forth on the Disclosure Schedule).
Except as set forth in the Disclosure Schedule, to the knowledge of
FMLP, the buildings and improvements on the Current Real Property
(including, without limitation, the heating, air conditioning,
mechanical, electrical and other systems used in connection
therewith) are in a reasonable state of repair, have been well
maintained and are free from infestation by termites, other wood
destroying insects, vermin and other pests. Except as set forth on
the Disclosure Schedule, there are no repairs or replacements
exceeding $100,000 in the aggregate for all Current Real Property or
$25,000 for any single repair or replacement which are currently
contemplated by any FMLP Operating Entity or Bethesda.

(k) Tangible Personal Property. FMLP has delivered to
Buyer a list of each item of Tangible Personal Property owned by any
FMLP Operating Entity having a value in excess of $5,000, and a list
each item of Tangible Personal Property leased by any FMLP Operating
Entity (other than individual leases of office equipment having an
annual rental of less than $5,000). No FMLP Operating Entity is a
party to any lease for Tangible Personal Property which is required
to be capitalized under GAAP. There is no tangible personal property
used in the operation of the Business other than the Tangible
Personal Property. Except as set forth on the Disclosure Schedule,
the Tangible Personal Property owned by each FMLP Operating
Entity is free and clear of any Encumbrances (other than Permitted
Encumbrances). Except as set forth on the Disclosure Schedule,
all of the Tangible Personal Property is located at the Current
Real Property and there is no tangible personal property located at
the Current Real Property which is not owned or leased by any FMLP
Operating Entity. Except as set forth in the Disclosure Schedule,
to the knowledge of FMLP, the Tangible Personal Property is,
taken as a whole, in reasonable working order and
<PAGE> 81

-6-

adequate for its intended use, ordinary wear and tear and normal
repairs and replacements excepted. Except as disclosed on the
Disclosure Schedule, there are no repairs or replacements exceeding
$50,000 in the aggregate for all Tangible Personal Property or
$10,000 for any single item of Tangible Personal Property which are
currently contemplated by any FMLP Operating Entity.

(l) Intellectual Property.

(i) Except as set forth on the Disclosure Schedule,
(A) there is no intellectual property used in the Business other than
the Intellectual Property, (B) each item of Intellectual Property
owned or used by any FMLP Operating Entity immediately prior to the
Closing Date will be owned or available for use by Buyer on
substantially similar terms and conditions immediately subsequent to
the Closing Date and (C) to the knowledge of FMLP, each FMLP
Operating Entity has taken reasonable commercial actions to maintain
and protect each item of material Intellectual Property in the
Business.

(ii) Except as set forth on the Disclosure Schedule,
(A) no FMLP Operating Entity has during the last five (5) years
interfered with, infringed upon, misappropriated or otherwise come
into conflict with any intellectual property rights of third parties,
and no FMLP Operating Entity has received any charge, complaint,
claim, demand or notice alleging any such interference, infringement,
misappropriation or violation (including any claim that any FMLP
Operating Entity must license or refrain from using any intangible
property rights of any third party) which has not been resolved and
(B) to the knowledge of FMLP, no third party has interfered with,
infringed upon, misappropriated or otherwise come into conflict with
any of the Intellectual Property.

(iii) The Disclosure Schedule identifies each
patent or registration which has been issued to any FMLP Operating
Entity with respect to any of the Intellectual Property, identifies
each pending patent application or application for registration which
any FMLP Operating Entity has made with respect to any of the
Intellectual Property, and identifies each license or other agreement
which any FMLP Operating Entity has granted to any third party with
respect to any of the Intellectual Property. FMLP has delivered to
Buyer correct and complete copies of all such patents, registrations,
applications, licenses and agreements (as amended to date) and has
made available to Buyer correct and complete copies of all other
written documentation evidencing ownership and prosecution (if
applicable) of each such item. The Disclosure Schedule also
identifies each trade name or unregistered trademark having a
value used by any FMLP Operating Entity in connection with the
Business. Except as set forth on the Disclosure Schedule, with
respect to each item of Intellectual Property required to be
identified in the Disclosure Schedule: (A) each FMLP Operating Entity
possesses all right, title and interest in and to the item, free and
clear of any Encumbrances (other than Permitted Encumbrances) or
licenses, (B) the item is not subject to any outstanding injunction,
judgment, order, decree, ruling, or charge, (C) no Proceeding is
<PAGE> 82

-7-

pending or, to the knowledge of FMLP, threatened which challenges the
legality, validity, enforceability, use or ownership of the item and
(D) other than routine indemnities given to distributors, sales
representatives, dealers and customers, no FMLP Operating Entity has
any current obligations to indemnify any Person for or against any
interference, infringement, misappropriation, or other conflict with
respect to the item.

(iv) The Disclosure Schedule identifies each item of
Intellectual Property that any third party owns and that any FMLP
Operating Entity uses pursuant to license, sublicense or agreement,
other than off-the-shelf computer software subject to shrinkwrap
licenses. FMLP has delivered to Buyer correct and complete copies of
all such licenses, sublicenses and other agreements (as amended to
date). Except as set forth on the Disclosure Schedule, with respect
to each item of Intellectual Property required to be identified in
the Disclosure Schedule: (A) the license, sublicense or other
agreement covering the item is enforceable, except as may be limited
by Enforceability Limitations, (B) to the knowledge of FMLP,
following the Closing, the license, sublicense or other agreement
will continue to be enforceable on substantially similar terms and
conditions, except as may be limited by Enforceability Limitations,
(C) no FMLP Operating Entity nor, to the knowledge of FMLP, any other
party to the license, sublicense or other agreement is in material
breach or default, and no event has occurred which, with notice or
lapse of time, would constitute a breach or default or permit early
termination, modification or acceleration thereunder, (D) no FMLP
Operating Entity nor, to the knowledge of FMLP, any other party to
the license, sublicense or other agreement has repudiated any
provision thereof, (E) to the knowledge of FMLP, the underlying item
of Intellectual Property is not subject to any outstanding
injunction, judgment, order, decree, ruling or charge, (F) to the
knowledge of FMLP, no Proceeding is pending or threatened which
challenges the legality, validity or enforceability of the underlying
item of Intellectual Property and (G) no FMLP Operating Entity has
granted any sublicense or similar right with respect to the license,
sublicense or other agreement.

(v) Except as set forth on the Disclosure Schedule,
to the knowledge of FMLP, Buyer's use of the Intellectual Property
will not interfere with, infringe upon, misappropriate, or otherwise
come into conflict with, any intangible property rights of third
parties as a result of the continued operation of the Business as
presently conducted and as presently proposed to be conducted.

-8-

Governmental Requirement. The Disclosure Schedule identifies all
material Permits issued to any FMLP Operating Entity and currently in
effect. Except as set forth on the Disclosure Schedule, the Permits
constitute all permits, consents, licenses, franchises,
authorizations and approvals used in the operation of and necessary
to conduct the Business. All of the Permits are valid and in full
force and effect, no violations have been experienced, noted or
recorded and no violations are expected, and no Proceeding is pending
or, to the knowledge of FMLP, threatened to revoke or limit any of
the Permits.

(n) Litigation. Except as set forth on the Disclosure
Schedule, there is no Proceeding pending or, to the knowledge of
FMLP, currently threatened against or relating to any FMLP Operating
Entity, its partners, shareholders, directors, officers or employees,
or its properties, assets or business relating to the Business.

(o) Labor Matters. (i) The Disclosure Schedule identifies
for each current employee of any FMLP Operating Entity with a current
annual compensation (base salary plus bonus) in excess of $50,000,
his or her name, position or job title, his or her base compensation
and bonus compensation earned in calendar-year 1995, and his or her
current base compensation. Except as set forth on The Disclosure
Schedule, (A) no FMLP Operating Entity has any obligations under any
written or oral labor agreement, collective bargaining agreement or
other agreement with any labor organization or employee group, (B) no
FMLP Operating Entity is currently engaged in any unfair labor
practice and there is no unfair labor practice charge or other
employee-related or employment-related complaint against such FMLP
Operating Entity pending or, to the knowledge of FMLP, threatened
before any Governmental Authority, (C) there is currently no labor
strike, labor disturbance, slowdown, work stoppage or other material
labor dispute or arbitration pending or, to the knowledge of FMLP,
threatened against any FMLP Operating Entity and no material
grievance currently being asserted, (D) no FMLP Operating Entity has
experienced a labor strike, labor disturbance, slowdown, work
stoppage or other material labor dispute at any time during the three
years immediately preceding the date of this Agreement and (E) there
is, to the knowledge of FMLP, no organizational campaign being
conducted or contemplated and there is no pending or, to the
knowledge of FMLP, threatened petition before any Governmental
Authority or other dispute as to the representation of any employees
of any FMLP Operating Entity. Except as set forth on the Disclosure
Schedule, each FMLP Operating Entity has complied in all material
respects with, and is currently in compliance in all material
respects with, all applicable Governmental Requirements relating to
any of its employees or consultants (including, without limitation,
any Governmental Requirement of the Occupational Safety and Health
Administration), and no FMLP Operating Entity has received within
the past three (3) years any written notice of failure to comply
with any such Governmental Requirement which has not been rectified.

(ii) Except as set forth on the Disclosure Schedule,
each FMLP Operating Entity has on file a valid Form I-9 for each
employee hired by such FMLP
<PAGE> 84

-9-

Operating Entity or any Predecessor of such FMLP Operating Entity on
or after November 7, 1986 and continuously employed after November 6,
1986 or the applicable date of hire. Except as set forth on the
Disclosure Schedule, to the knowledge of FMLP, all employees of any
FMLP Operating Entity employed in the U.S. are (A) United States
citizens, or lawful permanent residents of the United States, (B)
aliens whose right to work in the United States is unrestricted, (C)
aliens who have valid, unexpired work authorization issued by the
Attorney General of the United States (Immigration and Naturalization
Service) or (D) aliens who have been continually employed by such
FMLP Operating Entity since November 6, 1986 or the applicable date
of hire. Except as set forth on the Disclosure Schedule, no FMLP
Operating Entity has been the subject of an immigration compliance or
employment visit from, nor has any FMLP Operating Entity been
assessed any fine or penalty by, or been the subject of any order or
directive of, the United States Department of Labor or the Attorney
General of the United States (Immigration and Naturalization
Service).

(p) Employee Benefit Plans. The Disclosure Schedule
contains a complete and accurate list of all Employee Benefit Plans.
Except as set forth on the Disclosure Schedule, with respect to each
Employee Benefit Plan:

(i) Such Employee Benefit Plan (and each related
trust, insurance contract, or fund) complies in form and in operation
in all material respects with the applicable requirements of ERISA,
the Code, and other applicable laws.

(ii) All required reports and descriptions have been
filed or distributed appropriately with respect to each such Employee
Benefit Plan. The requirements of COBRA have been met with respect
to each such Employee Benefit Plan which is a "group health plan"
within the meaning of COBRA.

(iii) All contributions (including all employer
contributions and employee salary reduction contributions) which are
due have been paid to each Employee Pension Benefit Plan and all
contributions for any period ending on or before the Closing Date
which are not yet due have been paid to each such Employee Pension
Benefit Plan were accrued in accordance with the past customs. All
premiums or other payments for all periods ending on or before the
Closing Date have been paid with respect to the Employee Benefit
Welfare Plan or have been accrued in accordance with past customs.

(iv) No Employee Pension Benefit Plan is subject to
the requirements of Section 412 of the Code or Section 302 of ERISA.

(v) There have been no "prohibited transactions"
within the meaning of Section 406(a) or 406(b) of ERISA, or of
Section 4975(c) of the Code with respect to any such Employee Benefit
Plan. No fiduciary has any liability for breach of fiduciary duty or
<PAGE> 85

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any failure to act or comply in connection with the administration or
investment of the assets of any such Employee Benefit Plan.

(vi) Neither any FMLP Operating Entity, nor any ERISA
Affiliate thereof, contributes to, has ever contributed to, or has
ever been required to contribute to any Multiemployer Plan, or has
any liability (including withdrawal liability) under any
Multiemployer Plan.

(vii) Neither any FMLP Operating Entity, nor any
ERISA Affiliate thereof, maintains or has ever maintained or
contributed to, or has ever been required to contribute to, any
Employee Welfare Benefit Plan providing medical, health, or life
insurance or other welfare-type benefits for current or future
retired or terminated employees, their spouses, or their dependents
(other than in accordance with Code Section 4980B).

(viii) There has been no amendment to, written
interpretation or announcement (whether or not written) or change in
employee participation or coverage under, any Employee Benefit Plan
that would increase materially the expense of maintaining such
Employee Benefit Plan above the level of expense incurred in respect
of such Employee Benefit Plan for the most recent plan year.

(ix) FMLP has delivered to the Buyer true and complete
copies of (i) the American Assumed Employee Benefit Plans (and
related trust agreements and other funding arrangements, if any, and
adoption agreements, if any), (ii) any amendments to the American
Assumed Employee Benefit Plans, (iii) written interpretations of the
American Assumed Employee Benefit Plans to the plan administrator of
such Plan (iv) material employee communications by the plan
administrator of any American Assumed Employee Benefit Plan
(including, but not limited to, summary plan descriptions and
summaries of material modifications as defined under ERISA), (v) the
three most recent annual reports (e.g., the complete Form 5500
series) prepared in connection with each American Assumed Employee
Benefit Plan (if any such report was required), including all
attachments (including without limitation the actuarial valuation
reports) and (vi) the three most recent actuarial valuation reports
prepared in connection with each American Assumed Employee Benefit
Plan (if any such report was required).

(x) There are no pending or, to the knowledge of
FMLP, threatened claims, suits or other proceedings by any employees,
former employees or plan participants or the beneficiaries, spouses
or representatives of any of them, against any American Assumed
Employee Benefit Plan, the assets held

thereunder, the trustee of any such assets, or any FMLP Operating
Entity relating to any of the American Assumed Employee Benefit Plans
other than ordinary and usual claims for benefits by participants or
beneficiaries. Furthermore, there are no pending or, to the
knowledge of FMLP, threatened suits,
<PAGE> 86

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investigations or other proceedings by any Governmental Authority of
or against any American Assumed Employee Benefit Plan, the trustee of
any assets held thereunder, or any FMLP Operating Entity relating to
any of the American Assumed Employee Benefit Plans.

(xi) No liability has been incurred by any FMLP
Operating Entity, or any ERISA Affiliate thereof, for any tax,
penalty or other liability to any Governmental Authority with respect
to any American Assumed Employee Benefit Plan and, to the knowledge
of FMLP, such Plans do not expect to incur any such liability prior
to the date of Closing.

(xii) No American Assumed Employee Benefit Plan
provides benefits, including without limitation, death, disability,
or medical benefits (whether or not insured), with respect to current
or former employees of any FMLP Operating Entity beyond their
retirement or other termination of service other than (i) coverage
mandated by applicable law, (ii) death, disability or retirement
benefits under any Employee Pension Benefit Plan, (iii) disability
benefits under any Employee Welfare Benefit Plan providing for short
or long term disability benefits provided under a contract of
insurance or (iv) benefits, the full cost of which is borne by the
current or former employee (or his or her beneficiary).

(xiii) Each American Assumed Employee Benefit Plan
which is an Employee Pension Benefit Plan is "qualified" within the
meaning of Section 401(a) of the Code, and has been qualified during
the period from the date of its adoption to the date of this
Agreement, and each trust created thereunder is tax-exempt under
Section 501(a) of the Code. FMLP have delivered to the Buyer the
latest determination letters of the Internal Revenue Service (if one
has been received) relating to each such American Assumed Employee
Benefit Plan. Such determination letters have not been revoked.
Furthermore, there are no pending proceedings or, to the knowledge of
the FMLP, threatened proceedings in which the "qualified" status of
any such American Assumed Employee Benefit Plan is at issue and in
which revocation of the determination letter has been threatened.
Each such American Assumed Employed Benefit Plan has not been amended
or operated, since the receipt of the most recent determination
letter, in a manner that would adversely affect the "qualified"
status of such Plan.

(q) Transactions with Certain Persons. Except as set
forth on the Disclosure Schedule or as otherwise disclosed in this
Agreement, to the knowledge of FMLP, (i) no Related Person is
presently or at any time during the past one (1) year has been a
party to any transaction not on an arm's-length basis with any
FMLP Operating Entity including, without limitation, any contract,
agreement or other arrangement (A) providing for the furnishing of
services to or by, (B) providing for the rental or sale of real or
personal property to or from or (C) otherwise requiring payments
annually to or from (other than for services as officers or employees
of any FMLP Operating Entity), such Related Person and (ii) no
partner, shareholder, director, officer or employee of any FMLP
Operating Entity is
<PAGE> 87

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related to any other partner, shareholder, director, officer or
employee of any FMLP Operating Entity by blood or marriage. Except
as set forth on the Disclosure Schedule, there is no outstanding
amount in excess of $500 owing (including, without limitation,
pursuant to any advance, note or other indebtedness instrument) from
any FMLP Operating Entity to any Related Person identified on the
Disclosure Schedule or from any Related Person identified on the
Disclosure Schedule to any FMLP Operating Entity.

(r) Insurance. The Disclosure Schedule contains a
complete and accurate list of all current policies or binders of
Insurance (showing as to each policy or binder the carrier, policy
number, coverage limits, expiration dates, annual premiums,
deductibles and a general description of the type of coverage
provided and policy exclusions) maintained by any FMLP Operating
Entity and relating to such FMLP Operating Entity's properties,
assets and personnel. Except as set forth on the Disclosure
Schedule, all of the Insurance is "occurrence" based insurance. The
Insurance is in full force and effect and sufficient for compliance
in all material respects with all requirements of applicable law and
of all contracts to which any FMLP Operating Entity is a party. No
FMLP Operating Entity is in material default under any of the
Insurance, and no FMLP Operating Entity has failed to give any notice
or to present any claim under any of the Insurance in a due and
timely manner. No notice of cancellation, termination, reduction in
coverage or increase in premium (other than reductions in coverage or
increases in premiums in the ordinary course) has been received with
respect to any of the Insurance, and all premiums with respect to any
of the Insurance have been timely paid. No FMLP Operating Entity has
experienced claims in excess of current coverage of the Insurance.
Except as disclosed on the Disclosure Schedule, there will be no
retrospective insurance premiums or charges on or with respect to any
of the Insurance for any period or occurrence through the Closing
Date.

(s) Inventory. Except as set forth on the Disclosure
Schedule, (i) all of the Inventory is owned by each FMLP Operating
Entity free and clear of any Encumbrances (other than Permitted
Encumbrances) and is located at the Current Real Property, (ii) none
of the Inventory is on consignment, (iii) the Inventory as reflected
in the Financial Statements and Interim Financial Statements has been
valued at the lower of cost (on a first-in, first-out basis) or
market value in a manner consistent with past practices and
procedures (including, without limitation, the method of computing
overhead and other indirect expenses to be applied to inventory) and
in accordance with GAAP and (iv) all inventory located at the Current
Real Property is owned by the FMLP Operating Entities and is not held
by the FMLP
Operating Entities (on consignment or otherwise) for or on behalf of
any other Person.

(t) Accounts Receivable. All of the Accounts Receivable
of each FMLP Operating Entity are bona fide receivables, are
reflected on the books and records of each FMLP Operating Entity and
arose in the ordinary course of the Business.
<PAGE> 88

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(u) Material Contracts. The Disclosure Schedule contains
a true and correct list or description of the Material Contracts.
True and correct copies of the Material Contracts have been delivered
to Buyer. Each of the Material Contracts is enforceable against each
FMLP Operating Entity and, to the knowledge FMLP, each other party
thereto, in accordance with its terms, except as such enforcement may
be limited by Enforceability Limitations. No FMLP Operating Entity
nor, to the knowledge of FMLP, any other party to any Material
Contract, is in material default thereunder or in material breach
thereof, and no FMLP Operating Entity has during the past two (2)
years obtained or granted any material waiver of or under any
provision of any Material Contract except for routine waivers granted
or sought in the ordinary course of the Business. To the knowledge
of FMLP, there exists no event, occurrence, condition or act which
constitutes or, with the giving of notice, the lapse of time or the
happening of any future event or condition, would become a material
default by any FMLP Operating Entity or, to the knowledge of FMLP,
any other party under any Material Contracts. FMLP does not know of
a threatened default under any Material Contracts.

(v) Suppliers and Customers. The Disclosure Schedule
contain a list of the ten (10) largest suppliers and ten (10) largest
customers of the Business for calendar-year 1995. Except as set
forth on the Disclosure Schedule, to the knowledge of FMLP, none of
the suppliers or customers set forth on the Disclosure Schedule has
informed any FMLP Operating Entity that it intends to terminate its
relationship with any FMLP Operating Entity, and FMLP is not aware of
any such supplier or customer that intends to terminate such
relationship or of any material problem or dispute with any such
supplier or customer. Each FMLP Operating Entity believes that it
has good business relationships with each such supplier and customer.
FMLP does not believe that the consummation of a sale of the Business
will or is likely to disrupt the existing relationships with any such
supplier or customer in any material respect.

(w) Business Records. No material records of accounts,
personnel records and other business records for the past five (5)
years relating to the Business have been destroyed and all such
records are available upon request, subject to applicable
Governmental Requirements and/or contractual prohibitions or
limitations.

(x) Bank Accounts. The Disclosure Schedule contains a
true, complete and correct list of all bank accounts and safe deposit
boxes maintained by any FMLP Operating Entity and all persons
entitled to draw thereon, to withdraw therefrom or with
access thereto and a description of all lock box arrangements for any
FMLP Operating Entity.

-14-

Predecessor of each FMLP Operating Entity and its assets, properties
and operations were in compliance in all material respects with all
applicable Environmental Laws. Except as set forth on the Disclosure
Schedule, and except in compliance with Environmental Laws, there has
been and is no Release or threatened Release of any Hazardous
Substance at, on, under, in, to or from any of the Real Property,
whether as a result of the operations and activities at the Real
Property or otherwise. Except as set forth on the Disclosure
Schedule, no FMLP Operating Entity nor any Predecessor of any FMLP
Operating Entity has received any notice of alleged, actual or
potential responsibility for, or any inquiry or investigation
regarding, the presence, Release or threatened Release of any
Hazardous Substance at any location, whether at the Real Property or
otherwise, which Hazardous Substances were allegedly manufactured,
used, generated, processed, treated, stored, disposed of or otherwise
handled at or transported from the Real Property or otherwise.
Except as set forth on the Disclosure Schedule, no FMLP Operating
Entity nor any Predecessor has received any notice of any other
claim, demand or action by any Person alleging any actual or
threatened injury or damage to any Person, property, natural resource
or the environment arising from or relating to the presence, Release
or threatened Release of any Hazardous Substances at, on, under, in,
to or from the Real Property or in connection with any operations or
activities thereat, or at, on, under, in, to or from any other
property. Neither the Real Property nor any operations or activities
thereat is or has been subject to any judicial or administrative
proceeding, order, consent, agreement or any lien relating to any
applicable Environmental Laws or Environmental Claims. Except as set
forth on the Disclosure Schedule, there are no underground storage
tanks presently located at the Current Real Property and there have
been no releases of any Hazardous Substances from any underground
storage tanks or related piping at the Current Real Property. Except
as set forth on the Disclosure Schedule, there are no PCBs located
at, on, under or in the Current Real Property. Except as set forth
on the Disclosure Schedule, to the knowledge of FMLP, there is no
asbestos or asbestos-containing material located at, on, under or in
the Current Real Property.

(z) Absence of Certain Changes. Except as set forth on
the Disclosure Schedule, since December 31, 1995 there has not been:

(i) any material adverse change in the Business,
financial condition or operations of the FMLP Operating Entities
conducting the Business taken as a whole.

(ii) any increase in the compensation of or granting
of bonuses payable or to become payable by any FMLP
Operating Entity to any officer or employee whose 1995 calendar-year
compensation (base salary plus bonus) exceeded $50,000, other than
annual increases or bonuses consistent with any FMLP Operating
Entity's past practices and not exceeding, for any such officer or
employee, four percent (4%) of such officer's or employee's 1995
calendar-year compensation;
<PAGE> 90

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(iii) any sale or transfer by any FMLP Operating
Entity of any tangible or intangible asset having a value greater
than $5,000, any mortgage or pledge or creation of any Encumbrance
relating to any such asset, any lease of real property or equipment,
or any cancellation of any debt or claim, except in the ordinary
course of business;

(iv) any other material transaction not in the
ordinary course of the Business or not otherwise consistent with any
FMLP Operating Entity's past practices involving consideration in
excess of $50,000; or

(v) any material change in accounting methods or
principles.

(aa) No Brokers. Except for FMLP's arrangement with Dean
Witter Reynolds, Inc., no FMLP Operating Entity has entered into any
agreement, arrangement or understanding with any Person which will
result in the obligation to pay any finder's fee, brokerage
commission or similar payment in connection with the transactions
contemplated by this Agreement.

(ab) Absence of Certain Payments. To the knowledge of
FMLP, no FMLP Operating Entity, nor any other Person owned or
controlled by FMLP, nor any of their respective partners,
shareholders, directors, officers, employees or agents, or other
people acting on behalf of any of them, have with respect to the
Business (i) engaged in any activity prohibited by the United States
Foreign Corrupt Practices Act of 1977 or any other similar law,
regulation or decree, directive or order of any Governmental
Authority or (ii) without limiting the generality of the preceding
clause (i), used any corporate or other funds for unlawful
contributions, payments, gifts or entertainment, or made any unlawful
expenditures relating to political activity to officials of any
Governmental Authority. To the knowledge of FMLP, no FMLP Operating
Entity, nor any Person owned or controlled by FMLP, nor any of their
partners, shareholders, directors, officers, employees or agents, or
other Persons acting on behalf of any of them, has accepted or
received any unlawful contributions, payments, gifts or expenditures.

(ac) Products; Product Warranties.

(i) A form of each product warranty relating to
products manufactured or sold by any FMLP Operating Entity at any
time during the two-year period preceding the date of this Agreement
is attached to or set forth on the Disclosure Schedule.

-16-

withdrawn if all or a substantial number of products in a product
line were recalled or withdrawn) and (B) all Proceedings (whether
completed or pending) at any time during the past five three (3)
years seeking the recall, withdrawal, suspension or seizure of any
product sold by any FMLP Operating Entity.

(iii) Except as set forth on the Disclosure
Schedule, FMLP is not aware of any defect in design, materials,
manufacture or otherwise in any products manufactured, distributed or
sold by any FMLP Operating Entity during the past five (5) years or
any defect in repair to any such products which could give rise to
any claims in excess of historical warranty expenses; provided,
however, that for purposes of this paragraph improvements made to
products in the ordinary course of business shall not be interpreted
as an indication of the existence of any defects.

(iv) The Disclosure Schedule sets forth on a
year-by-year basis, a true and complete list of all warranty expenses
and all other unreimbursed repair, maintenance and replacement
expenses incurred by any FMLP Operating Entity after January 1, 1993.

(v) Except as provided in any of the standard product
warranties described in paragraph (i) of this Section and as
otherwise set forth on the Disclosure Schedule, no FMLP Operating
Entity has sold any products or services which are subject to an
extended warranty of such FMLP Operating Entity beyond 24 months and
which warranty has not yet expired.
<PAGE> 92

SCHEDULE 4.2

REPRESENTATIONS AND WARRANTIES RELATING TO THE
DUTCH BUSINESS

(a) Organization, Subsistence and Authority of FMLP
Operating Entities to Conduct Business. Each FMLP Operating Entity
is duly organized and validly existing under the laws of the
jurisdiction of its organization. The Disclosure Schedule sets forth
the jurisdiction of organization of each FMLP Operating Entity and
each jurisdiction where any FMLP Operating Entity is qualified to do
business. Each FMLP Operating Entity is duly qualified to do
business in each jurisdiction in which such qualification is
necessary under the applicable law as a result of the conduct of the
Business. Each FMLP Operating Entity has full partnership or
corporate power and authority to conduct its business as it is
presently being conducted and to own and lease its properties and
assets. Except as set forth on the Disclosure Schedule, no FMLP
Operating Entity has any stock or equity interest in any corporation,
firm or any other Person.

(b) Power and Authority; Authorization; Binding Effect.
FM-Europe and each FMLP Operating Entity which is a party to the
Dutch Purchase Agreement has all necessary power and authority and
has taken all action necessary to authorize, execute and deliver the
Dutch Purchase Agreement, to consummate the transactions contemplated
by the Dutch Purchase Agreement, and to perform its obligations under
the Dutch Purchase Agreement. The General Partners are the only
general partners of FMLP and each General Partner has all necessary
power and authority and has taken all action necessary to execute and
deliver the Dutch Purchase Agreement. No consent or other action of
the Limited Partners is required for FMLP to execute and deliver the
Dutch Purchase Agreement, to consummate the transactions contemplated
by the Dutch Purchase Agreement or to perform its obligations under
the Dutch Purchase Agreement. Copies of all resolutions of the board
of directors of each General Partner with respect to the transactions
contemplated by the Dutch Purchase Agreement, certified by the
Secretary or an Assistant Secretary of such General Partner, in form
reasonably satisfactory to counsel for Buyer, have been delivered to
Buyer. The Dutch Purchase Agreement has been duly executed and
delivered by FM-Europe and each FMLP Operating Entity which is a
party thereto and constitutes a legal, valid and binding obligation
of FM-Europe and each such FMLP Operating Entity enforceable against
FM-International, FM-Europe and each such FMLP Operating Entity in
accordance with its terms, except as such enforcement may be limited
by the Enforceability Limitations.

(c) No Conflict or Violation. The execution and delivery
of the Dutch Purchase Agreement, the consummation of the transactions
contemplated by the Dutch Purchase Agreement, and
the fulfillment of the terms of the Dutch Purchase Agreement, do not
and will not result in or constitute (i) a violation of or conflict
with any provision of the organizational or other governing documents
of FM-Europe or any FMLP Operating Entity, (ii) except as set forth
on the Disclosure Schedule, a breach of, a loss of rights under, or
constitute an event, occurrence, condition or act which is or, with
the giving of notice or the
<PAGE> 93

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lapse of time, would become, a material default under, or result in
the acceleration of any obligations under, any term or provision of,
any Material Contract, Encumbrance or material Permit to which
FM-Europe or any FMLP Operating Entity is a party, (iii) a material
violation by FM-Europe or any FMLP Operating Entity of any statute,
rule, regulation, ordinance, code, order, judgment, writ, injunction,
decree or award applicable to FM-Europe or any FMLP Operating Entity
or (iv) an imposition of any Encumbrance (other than a Permitted
Encumbrance) on the American Purchased Assets, the FM-U.K. Shares,
the FM-Spain Shares or the FM-Sweden Shares.

(d) Consents and Approvals. Except as set forth on the
Disclosure Schedule, no consent, approval or authorization of, or
declaration, filing or registration with, any Person is required to
be made or obtained by FM-Europe or any FMLP Operating Entity in
connection with the execution, delivery and performance of the Dutch
Purchase Agreement and the consummation of the transactions
contemplated by the Dutch Purchase Agreement.

(e) No Proceedings. There is no Proceeding pending or, to
the knowledge of FMLP, threatened in writing against or relating to
the transactions contemplated by the Dutch Purchase Agreement.

(f) Ownership of FM-U.K., FM-Spain and FM-Sweden. The
Disclosure Schedule sets forth the authorized, issued and outstanding
capital stock of FM-Sweden, FM-U.K. and FM-Spain, the ownership
thereof and any Encumbrance thereon. Except as set forth on the
Disclosure Schedule, (i) there are no securities of either of
FM-U.K., FM-Sweden or FM-Spain convertible into or exchangeable or
exercisable for shares of its capital stock, (ii) there are no bonds,
debentures, notes, or other indebtedness having the right to vote on
any matters on which FM-U.K., FM-Sweden or FM-Spain's shareholders
may vote, (iii) there are no outstanding options, warrants, rights,
contracts, commitments, understandings or arrangements by which
FM-U.K., FM-Sweden or FM-Spain is bound to issue, repurchase or
otherwise acquire or retire any of its securities and, there are no
voting agreements, voting trusts, buy-sell agreements, options or
rights or obligations relating to the shareholders or the securities
of FM-U.K., FM-Sweden or FM-Spain.

(g) Corporate Records. The minute books of each of
FM-U.K., FM-Spain and FM-Sweden contain a complete and accurate
record of all material meetings and actions of shareholders and
directors of such corporation, and of any executive committee or
other committee of the shareholders or board of directors of such
corporation. The stock record book of each of FM-U.K., FM-Spain and
FM-Sweden is complete and accurate and contains a complete
and accurate record of all share transactions for such corporation
from the date of its incorporation. The minute books and stock
record books (or partnership equivalents) of FM-Europe and all FMLP
Operating Entities other than FM-U.K., FM-Spain and FM-Sweden have
been made available to Buyer for its review and contain a complete
and
<PAGE> 94

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accurate record of all material meetings of shareholders, directors,
partners, members or other appropriate governing bodies, as the case
may be.

(h) [Intentionally Deleted]

(i) Tax Matters.

(i) Except as set forth on the Disclosure Schedule,
to the knowledge of FMLP, (A) each FMLP Operating Entity has filed
all Tax Returns that it was required to file, (B) all Taxes required
to have been withheld in connection with amounts paid or owing to any
employee, independent contractor, creditor, stockholder or other
third party have been withheld, (C) all such Tax Returns were correct
and complete in all material respects, (D) all Taxes required to have
been paid by any FMLP Operating Entity (whether or not shown on any
Tax Return) have been paid, (E) no FMLP Operating Entity is currently
the beneficiary of any extension of time within which to file any Tax
Return and (F) no claim has been made within the last five (5) years
by any Governmental Authority in a jurisdiction where any FMLP
Operating Entity does not file Tax Returns that it is or may be
subject to taxation by that jurisdiction. There are no Encumbrances
(other than Permitted Encumbrances) on any of the Dutch Purchased
Assets, the FM-U.K. Shares, FM-Spain Shares and FM-Sweden Shares that
arose in connection with any failure (or alleged failure) to pay any
Tax.

-4-

to any commitment for sale or use by any Person other than such FMLP
Operating Entity, (iv) no interest of FM-Europe or any FMLP Operating
Entity in the Current Real Property is subject to any Encumbrances
(other than Permitted Encumbrances), which in any material respect
interfere with or impair the value, transferability or present and
continued use thereof in the usual and normal conduct of the
Business, (v) no labor has been performed or material furnished on
behalf of or at the request of any FMLP Operating Entity for the
Current Real Property for which a mechanic's or materialman's lien or
liens, or any other lien, has been claimed by any Person on any FMLP
Operating Entity's interest in the Current Real Property, except to
the extent that the liability relating thereto is reflected on the
Closing Date Financial Report, (vi) the Current Real Property, and
each user thereof, is in compliance in all material respects with all
applicable Governmental Requirements and (vii) no material default or
breach exists with respect to any Encumbrance affecting any FMLP
Operating Entity's interest in the Current Real Property. There are
no condemnation or eminent domain proceedings pending or, to the
knowledge of FMLP, contemplated or threatened against FM-Europe or
any FMLP Operating Entity's interest in the Current Real Property or
any part thereof, and no FMLP Operating Entity knows of any desire of
any Governmental Authority to take or use any FMLP Operating Entity's
interest in the Current Real Property or any part thereof. Except as
set forth on the Disclosure Schedule, there are no existing or, to
the knowledge of FMLP, contemplated or threatened general or special
assessments against FM-Europe's or any FMLP Operating Entity's
interest in the Current Real Property or any portion thereof. FMLP
does not have any knowledge of any pending or threatened Proceeding
before any Governmental Authority which relates to the ownership,
maintenance, use or operation of FM-Europe's or any FMLP Operating
Entity's interest in the Current Real Property (other than periodic
general reassessments, which reassessments, if any, are set forth on
the Disclosure Schedule). Except as set forth in the Disclosure
Schedule, to the knowledge of FMLP, the buildings and improvements on
the Current Real Property (including, without limitation, the
heating, air conditioning, mechanical, electrical and other systems
used in connection therewith) are in a reasonable state of repair,
have been well maintained and are free from infestation by termites,
other wood destroying insects, vermin and other pests. Except as set
forth on the Disclosure Schedule, there are no repairs or
replacements exceeding $100,000 in the aggregate for all Current Real
Property or $25,000 for any single repair or replacement which are
currently contemplated by any FMLP Operating Entity.

-5-

owned by FM-Europe or each FMLP Operating Entity is free and clear of
any Encumbrances (other than Permitted Encumbrances). Except as set
forth on the Disclosure Schedule, all of the Tangible Personal
Property is located at the Current Real Property and there is no
tangible personal property located at the Current Real Property which
is not owned or leased by any FMLP Operating Entity. Except as set
forth in the Disclosure Schedule, to the knowledge of FMLP, the
Tangible Personal Property is, taken as a whole, in reasonable
working order andadequate for its intended use, ordinary wear and
tear and normal repairs and replacements excepted. Except as
disclosed on the Disclosure Schedule, there are no repairs or
replacements exceeding $50,000 in the aggregate for all Tangible
Personal Property or $10,000 for any single item of Tangible Personal
Property which are currently contemplated by any FMLP Operating
Entity.

(l) Intellectual Property.

(i) Except as set forth on the Disclosure Schedule,
(A) there is no intellectual property used in the Business other than
the Intellectual Property, (B) each item of Intellectual Property
owned or used by FM-Europe or any FMLP Operating Entity immediately
prior to the Closing Date will be owned or available for use by Buyer
on substantially similar terms and conditions immediately subsequent
to the Closing Date and (C) to the knowledge of FMLP, each FMLP
Operating Entity has taken reasonable commercial actions to maintain
and protect each item of material Intellectual Property in the
Business.

-6-

applicable) of each such item. The Disclosure Schedule also
identifies each trade name or unregistered trademark having a value
used by any FMLP Operating Entity in connection with the Business.
Except as set forth on the Disclosure Schedule, with respect to each
item of Intellectual Property required to be identified in the
Disclosure Schedule: (A) each FMLP Operating Entity possesses all
right, title and interest in and to the item, free and clear of any
Encumbrances (other than Permitted Encumbrances) or licenses, (B) the
item is not subject to any outstanding injunction, judgment, order,
decree, ruling, or charge, (C) no Proceeding is pending or, to the
knowledge of FMLP, threatened which challenges the legality,
validity, enforceability, use or ownership of the item and (D) other
than routine indemnities given to distributors, sales
representatives, dealers and customers, no FMLP Operating Entity has
any current obligations to indemnify any Person for or against any
interference, infringement, misappropriation, or other conflict with
respect to the item.

-7-

(m) Compliance with Laws; Permits. Except as set forth on
the Disclosure Schedule, the conduct of the Business is in compliance
in all material respects with all applicable Governmental
Requirements. No FMLP Operating Entity has received any notice to
the effect that, or otherwise been advised that, such FMLP Operating
Entity is not in compliance in all material respects with any
applicable Governmental Requirement and, to the knowledge of FMLP,
there are no presently existing facts, circumstances or events which,
with notice or lapse of time, would result in material violations of
any applicableGovernmental Requirement. The Disclosure Schedule
identifies all material Permits issued to any FMLP Operating Entity
and currently in effect. Except as set forth on the Disclosure
Schedule, the Permits constitute all permits, consents, licenses,
franchises, authorizations and approvals used in the operation of and
necessary to conduct the Business. All of the Permits are valid and
in full force and effect, no violations have been experienced, noted
or recorded and no violations are expected, and no Proceeding is
pending or, to the knowledge of FMLP, threatened to revoke or limit
any of the Permits.

(o) Labor Matters. The Disclosure Schedule contains an
accurate and complete list of agreements, arrangements and
understandings, written or oral, with all employees and directors of
FM-Holland with a current annual compensation in excess of NLG 83,000
that are being transferred to Buyer by virtue of Article 1639aa of
the Dutch Civil Code, including accurate and complete details of
their compensation. All obligations towards all employees that are
being transferred to Buyer, including but not limited to accrued
salaries, bonuses, vacation pay or any other accrued or deferred
compensation and benefits, which are due on the Closing Date have
been paid. Except as set forth on the Disclosure Schedule, (i) no
FMLP Operating Entity has any obligations under any written or oral
labor agreement, collective bargaining agreement or other agreement
with any labor organization or employee group, (ii) no FMLP Operating
Entity is currently engaged in any unfair labor practice and there is
no unfair labor practice charge or other employee related or
employment related complaint against such FMLP Operating Entity
pending, or to the knowledge or FMLP, threatened before any
Governmental Authority, (iii) there is currently no labor strike,
labor disturbance, slow down, work stoppage or other material labor
dispute or arbitration pending or, to the knowledge of
FMLP, threatened against any FMLP Operating Entity and no material
grievance currently being asserted, (iv) no FMLP Operating Entity has
experienced a labor strike, labor disturbance, slowdown, work
stoppage or other material labor dispute at any time during the three
years immediately preceding the date of the Dutch Purchase Agreement
and (v) there is, to the knowledge of FMLP, no organizational
campaign being conducted or contemplated and there is no pending or,
to the knowledge of FMLP, threatened petition before any Governmental
Authority or other dispute
<PAGE> 99

-8-

as to the representation of any employees of any FMLP Operating
Entity. Except as disclosed on the Disclosure Schedule, each FMLP
Operating Entity has complied in all material respects with all
applicable Governmental Requirements relating to any of its employees
or consultants and no FMLP Operating Entity has received within the
past three (3) years any written notice or failure to comply with any
such Governmental Requirements which has not been rectified.

(i) Such Employee Benefit Plan complies in form and
operation in all material respects with all applicable laws and
regulations, including but not limited to the Dutch Pension and
Savings Fund Act ("Pensioen en Spaarfondsenwet");

(ii) All contributions (including all employer
contributions and employee salary reduction contributions) which are
due, have been paid towards each Employee Benefit Plan and all
contributions for any period ending on or before the Closing Date
which are not yet due have been adequately accrued for and in
accordance with past customs. All premiums or other payments for all
periods ending on or before the Closing Date have been paid with
respect to the Employee Benefit Plans.

(q) Transactions with Certain Persons. Except as set
forth on the Disclosure Schedule or as otherwise disclosed in the
Dutch Purchase Agreement, to the knowledge of FMLP, (i) no Related
Person is presently or at any time during the past one (1) year has
been a party to any transaction not on an arm's-length basis with any
FMLP Operating Entity including, without limitation, any contract,
agreement or other arrangement (A) providing for the furnishing of
services to or by, (B) providing for the rental or sale of real or
personal property to or from or (C) otherwise requiring payments
annually to or from (other than for services as officers or employees
of any FMLP Operating Entity), such Related Person and (ii) no
partner, shareholder, director, officer or employee of any FMLP
Operating Entity is related to any other partner, shareholder,
director, officer or employee of any FMLP Operating Entity by blood
or marriage. Except as set forth on the Disclosure Schedule, there
is no outstanding amount in excess of $500 owing (including, without
limitation, pursuant to any advance, note or other indebtedness
instrument) from any FMLP Operating Entity to any Related Person
identified on the Disclosure Schedule or from any Related Person
identified on the Disclosure Schedule to any FMLP Operating Entity.

-9-

any FMLP Operating Entity and relating to such FMLP Operating
Entity's properties, assets and personnel. Except as set forth on
the Disclosure Schedule, all of the Insurance is "occurrence" based
insurance. The Insurance is in full force and effect and sufficient
for compliance in all material respects with all requirements of
applicable law and of all contracts to which any FMLP Operating
Entity is a party. No FMLP Operating Entity is in material default
under any of the Insurance, and no FMLP Operating Entity has failed
to give any notice or to present any claim under any of the Insurance
in a due and timely manner. No notice of cancellation, termination,
reduction in coverage or increase in premium (other than reductions
in coverage or increases in premiums in the ordinary course) has been
received with respect to any of the Insurance, and all premiums with
respect to any of the Insurance have been timely paid. No FMLP
Operating Entity has experienced claims in excess of current coverage
of the Insurance. Except as disclosed on the Disclosure Schedule,
there will be no retrospective insurance premiums or charges on or
with respect to any of the Insurance for any period or occurrence
through the Closing Date.

(s) Inventory. Except as set forth on the Disclosure
Schedule, (i) all of the Inventory is owned by FM-Europe or each FMLP
Operating Entity free and clear of any Encumbrances (other than
Permitted Encumbrances) and is located at the Current Real Property,
(ii) none of the Inventory is on consignment, (iii) the Inventory as
reflected in the Financial Statements and Interim Financial
Statements has been valued at the lower of cost (on a first-in,
first-out basis) or market value in a manner consistent with past
practices and procedures (including, without limitation, the method
of computing overhead and other indirect expenses to be applied to
inventory) and in accordance with GAAP and (iv) all inventory located
at the Current Real Property is owned by the FMLP Operating Entities
and is not held by the FMLP Operating Entities (on consignment or
otherwise) for or on behalf of any other Person.

(u) Material Contracts. The Disclosure Schedule contains
a true and correct list or description of the Material Contracts. True
and correct copies of the Material Contracts have been delivered to
Buyer. Each of the Material Contracts is enforceable against each
FMLP Operating Entity and, to the knowledge FMLP, each other party
thereto, in accordance with its terms, except as such enforcement may
be limited by Enforceability Limitations. No FMLP Operating Entity
nor, to the knowledge of FMLP, any other party to any Material
Contract, is in material default thereunder or in material breach
thereof, and no FMLP Operating Entity has during the past two (2)
years obtained or granted any material waiver of or under any
provision of any Material Contract except for routine waivers granted
or sought in the ordinary course of the Business. To the knowledge of
FMLP, there exists no event, occurrence, condition or act which
constitutes or, with the giving of notice, the
<PAGE> 101

-10-

lapse of time or the happening of any future event or condition,
would become a material default by any FMLP Operating Entity or, to
the knowledge of FMLP, any other party under any Material Contracts.
FMLP does not know of a threatened default under any Material
Contracts.

(x) Bank Accounts. The Disclosure Schedule contains a
true, complete and correct list of all bank accounts and safe deposit
boxes maintained by any FMLP Operating Entity and all persons
entitled to draw thereon, to withdraw therefrom or with access
thereto and a description of all lock box arrangements for any FMLP
Operating Entity.

(y) Environmental Matters. Except as set forth on the
Disclosure Schedule, each FMLP Operating Entity and its assets,
properties and operations are now and at all times prior to the
Closing Date have been in compliance in all material respects with all
applicable Environmental Laws. Except as set forth on the Disclosure
Schedule, each Predecessor of each FMLP Operating Entity and its
assets, properties and operations were in compliance in all material
respects with all applicable Environmental Laws. Except as set forth
on the Disclosure Schedule, and except in compliance with
Environmental Laws, there has been and is no Release or threatened
Release of any Hazardous Substance at, on, under, in, to or from any
of the Real Property, whether as a result of the operations and
activities at the Real Property or otherwise. Except as set forth on
the Disclosure Schedule, no FMLP Operating Entity nor any Predecessor
of any FMLP Operating Entity has received any notice of alleged,
actual or potential responsibility for, or any inquiry or
investigation regarding, the presence, Release or threatened Release
of any Hazardous Substance at any location, whether at the Real
Property or otherwise, which Hazardous Substances were allegedly
manufactured, used, generated, processed, treated, stored, disposed of
or otherwise handled at or
<PAGE> 102

-11-

transported from the Real Property or otherwise. Except as set forth
on the Disclosure Schedule, no FMLP Operating Entity nor any
Predecessor has received any notice of any other claim, demand or
action by any Person alleging any actual or threatened injury or
damage to any Person, property, natural resource or the environment
arising from or relating to the presence, Release or threatened
Release of any Hazardous Substances at, on, under, in, to or from the
Real Property or in connection with any operations or activities
thereat, or at, on, under, in, to or from any other property.
Neither the Real Property nor any operations or activities thereat is
or has been subject to any judicial or administrative proceeding,
order, consent, agreement or any lien relating to any applicable
Environmental Laws or Environmental Claims. Except as set forth on
the Disclosure Schedule, there are no underground storage tanks
presently located at the Current Real Property and there have been no
releases of any Hazardous Substances from any underground storage
tanks or related piping at the Current Real Property. Except as set
forth on the Disclosure Schedule, there are no PCBs located at, on,
under or in the Current Real Property. Except as set forth on the
Disclosure Schedule, to the knowledge of FMLP, there is no asbestos
or asbestos-containing material located at, on, under or in the
Current Real Property.

(z) Absence of Certain Changes. Except as set forth on
the Disclosure Schedule, since December 31, 1995 there has not been:

(i) any material adverse change in the Business,
financial condition or operations of the FMLP Operating Entities
conducting the Business taken as a whole.

(ii) any increase in the compensation of or granting
of bonuses payable or to become payable by any FMLP Operating Entity
to any officer or employee whose 1995 calendar-year compensation
(base salary plus bonus) exceeded $50,000, other than annual
increases or bonuses consistent with any FMLP Operating Entity's past
practices and not exceeding, for any such officer or employee, four
percent (4%) of such officer's or employee's 1995 calendar-year
compensation;

(iv) any other material transaction not in the
ordinary course of the Business or not otherwise consistent with
any FMLP Operating Entity's past practices involving consideration in
excess of $50,000; or

(v) any material change in accounting methods or
principles.
<PAGE> 103

-12-

(ac) Products; Product Warranties.

(i) A form of each product warranty relating to
products manufactured or sold by any FMLP Operating Entity at any
time during the two-year period preceding the date of the Dutch
Purchase Agreement is attached to or set forth on the Disclosure
Schedule.

(ii) The Disclosure Schedule sets forth a true and
complete list of (A) all products manufactured, marketed or sold by
any FMLP Operating Entity that have been recalled or withdrawn
(whether voluntarily or otherwise) at any time during the past three
(3) years (for purposes of this paragraph, a product shall have been
recalled or withdrawn if all or a substantial number of products in a
product line were recalled or withdrawn) and (B) all Proceedings
(whether completed or pending) at any time during the past five three
(3) years seeking the recall, withdrawal, suspension or seizure of
any product sold by any FMLP Operating Entity.

(iii) Except as set forth on the Disclosure
Schedule, FMLP is not aware of any defect in design, materials,
manufacture or otherwise in any products manufactured, distributed or
sold by any FMLP Operating Entity during the past
five (5) years or any defect in repair to any such products which
could give rise to any claims in excess of historical warranty
expenses; provided, however, that for purposes of this
<PAGE> 104

-13-

paragraph improvements made to products in the ordinary course of
business shall not be interpreted as an indication of the existence
of any defects.

(ad) Neither FM-Holland nor FM-Europe has been declared
bankrupt ("failliet") and no action or request is pending to declare
any of them bankrupt. Neither FM-Holland nor FM-Europe has been
filed or been granted moratorium of payment ("surseance van
betaling")

<PAGE> 105

SCHEDULE 4.3

REPRESENTATIONS AND WARRANTIES RELATING TO THE
AUSTRALIAN BUSINESS

(b) Power and Authority; Authorization; Binding Effect.
FM-International and each FMLP Operating Entity which is a party to
the Australian Purchase Agreement has all necessary power and
authority and has taken all action necessary to authorize, execute
and deliver the Australian Purchase Agreement, to consummate the
transactions contemplated by the Australian Purchase Agreement, and
to perform its obligations under the Australian Purchase Agreement.
The General Partners are the only general partners of FMLP and each
General Partner has all necessary power and authority and has taken
all action necessary to execute and deliver the Australian Purchase
Agreement. No consent or other action of the Limited Partners is
required for FMLP to execute and deliver the Australian Purchase
Agreement, to consummate the transactions contemplated by the
Australian Purchase Agreement or to perform its obligations under the
Australian Purchase Agreement. Copies of all resolutions of the
board of directors of each General Partner with respect to the
transactions contemplated by the Australian Purchase Agreement,
certified by the Secretary or an Assistant Secretary of such General
Partner, in form reasonably satisfactory to counsel for Buyer, have
been delivered to Buyer. The Australian Purchase Agreement has been
duly executed and delivered by FM-International and each FMLP
Operating Entity which is a party thereto and constitutes a legal,
valid and binding obligation of FM-International and each such FMLP
Operating Entity enforceable against FM-International and each such
FMLP Operating Entity in accordance with its terms, except as such
enforcement may be limited by the Enforceability Limitations.

(c) No Conflict or Violation. The execution and delivery
of the Australian Purchase Agreement, the consummation of the
transactions contemplated by the Australian Purchase Agreement, and
the fulfillment of the terms of the Australian Purchase Agreement, do
not and will not result in or constitute (i) a violation of or
conflict with any provision of the organizational or other governing
documents of FM-International or any FMLP Operating
<PAGE> 106

-2-

Entity, (ii) except as set forth on the Disclosure Schedule, a breach
of, a loss of rights under, or constitute an event, occurrence,
condition or act which is or, with the giving of notice or the lapse
of time, would become, a material default under, or result in the
acceleration of any obligations under, any term or provision of, any
Material Contract, Encumbrance or material Permit to which
FM-International or any FMLP Operating Entity is a party, (iii) a
material violation by FM-International or any FMLP Operating Entity
of any statute, rule, regulation, ordinance, code, order, judgment,
writ, injunction, decree or award applicable to FM-International or
any FMLP Operating Entity or (iv) an imposition of any Encumbrance
(other than a Permitted Encumbrance) on the Australian Purchased
Assets.

(d) Consents and Approvals. Except as set forth on the
Disclosure Schedule, no consent, approval or authorization of, or
declaration, filing or registration with, any Person is required to
be made or obtained by FM-International or any FMLP Operating Entity
in connection with the execution, delivery and performance of the
Australian Purchase Agreement and the consummation of the
transactions contemplated by the Australian Purchase Agreement.

(e) No Proceedings. There is no Proceeding pending or, to
the knowledge of FMLP, threatened in writing against or relating to
the transactions contemplated by the Australian Purchase Agreement.

(f) [Intentionally Deleted]

(g) [Intentionally Deleted]

(h) [Intentionally Deleted]

(i) Tax Matters.

(i) Except as set forth on the Disclosure Schedule,
to the knowledge of FMLP, (A) each FMLP Operating Entity has filed
all Tax Returns that it was required to file, (B) all Taxes required
to have been withheld in connection with amounts paid or owing to any
employee, independent contractor, creditor, stockholder or other
third party have been withheld, (C) all such Tax Returns were correct
and complete in all material respects, (D) all Taxes required to have
been paid by any FMLP Operating Entity (whether or not shown on any
Tax Return) have been paid, (E) no FMLP Operating Entity is currently
the beneficiary of any extension of time within which to file any Tax
Return and (F) no claim has been made within the last five (5) years
by any Governmental Authority in a jurisdiction where any FMLP
Operating Entity does not file Tax Returns that it is or
may be subject to taxation by that jurisdiction. There are no
Encumbrances (other than Permitted Encumbrances) on any of the
American Purchased Assets, the FM-Service Shares or the FM-Brazil
Shares that arose in connection with any failure (or alleged failure)
to pay any Tax.
<PAGE> 107

-3-

(j) Real Property. The Disclosure Schedule contains a
true, complete and correct list of the Real Property now or in the
past owned or used by any FMLP Operating Entity for manufacturing.
Except as set forth on the Disclosure Schedule, (i) FM-International
or each FMLP Operating Entity has title to the Current Real Property
owned by such FMLP Operating Entity, (ii) each FMLP Operating Entity
enjoys peaceful and undisturbed possession of the Current Real
Property leased by such FMLP Operating Entity, (iii) no interest of
FM-International or any FMLP Operating Entity in the Current Real
Property is subject to any commitment for sale or use by any Person
other than such FMLP Operating Entity, (iv) no interest of
FM-International or any FMLP Operating Entity in the Current Real
Property is subject to any Encumbrances (other than Permitted
Encumbrances), which in any material respect interfere with or impair
the value, transferability or present and continued use thereof in
the usual and normal conduct of the Business, (v) no labor has been
performed or material furnished on behalf of or at the request of any
FMLP Operating Entity for the Current Real Property for which a
mechanic's or materialman's lien or liens, or any other lien, has
been claimed by any Person on any FMLP Operating Entity's interest in
the Current Real Property, except to the extent that the liability
relating thereto is reflected on the Closing Date Financial Report,
(vi) the Current Real Property, and each user thereof, is in
compliance in all material respects with all applicable Governmental
Requirements and (vii) no material default or breach exists with
respect to any Encumbrance affecting any FMLP Operating Entity's
interest in the Current Real Property. There are no condemnation or
eminent domain proceedings pending or, to the knowledge of FMLP,
contemplated or threatened against FM-International's or any FMLP
Operating Entity's interest in the Current Real Property or any part
thereof, and no FMLP Operating Entity knows of any desire of any
Governmental Authority to take or use any FMLP Operating Entity's
interest in the Current Real Property or any part thereof. Except as
set forth on the Disclosure Schedule, there are no existing or, to
the knowledge of FMLP, contemplated or threatened general or special
assessments against FM-International's or any FMLP Operating Entity's
interest in the Current Real Property or any portion thereof. FMLP
does not have any knowledge of any pending or threatened Proceeding
before any
<PAGE> 108

-4-

Governmental Authority which relates to the ownership,
maintenance, use or operation of FM-Europe's or any FMLP Operating
Entity's interest in the Current Real Property (other than periodic
general reassessments, which reassessments, if any, are set forth on
the Disclosure Schedule). Except as set forth in the Disclosure
Schedule, to the knowledge of FMLP, the buildings and improvements on
the Current Real Property (including, without limitation, the
heating, air conditioning, mechanical, electrical and other systems
used in connection therewith) are in a reasonable state of repair,
have been well maintained and are free from infestation by termites,
other wood destroying insects, vermin and other pests. Except as set
forth on the Disclosure Schedule, there are no repairs or
replacements exceeding $100,000 in the aggregate for all Current Real
Property or $25,000 for any single repair or replacement which are
currently contemplated by any FMLP Operating Entity.

(k) Tangible Personal Property. FMLP has delivered to
Buyer a list of each item of Tangible Personal Property owned by any
FMLP Operating Entity having a value in excess of $5,000, and a list
each item of Tangible Personal Property leased by any FMLP Operating
Entity (other than individual leases of office equipment having an
annual rental of less than $5,000). Except as set forth on the
Disclosure Schedule, no FMLP Operating Entity is a party to any lease
for Tangible Personal Property which is required to be capitalized
under GAAP. There is no tangible personal property used in the
operation of the Business other than the Tangible Personal Property.
Except as set forth on the Disclosure Schedule, the Tangible Personal
Property owned by each FMLP Operating Entity is free and clear of any
Encumbrances (other than Permitted Encumbrances). Except as set
forth on the Disclosure Schedule, all of the Tangible Personal
Property is located at the Current Real Property and there is no
tangible personal property located at the Current Real Property which
is not owned or leased by any FMLP Operating Entity. Except as set
forth in the Disclosure Schedule, to the knowledge of FMLP, the
Tangible Personal Property is, taken as a whole, in reasonable
working order and adequate for its intended use, ordinary wear and
tear and normal repairs and replacements excepted. Except as
disclosed on the Disclosure Schedule, there are no repairs or
replacements exceeding $50,000 in the aggregate for all Tangible
Personal Property or $10,000 for any single item of Tangible Personal
Property which are currently contemplated by any FMLP Operating
Entity.

(l) Intellectual Property.

(i) Except as set forth on the Disclosure Schedule,
(A) there is no intellectual property used in the Business other than
the Intellectual Property, (B) each item of
Intellectual Property owned or used by FM-Europe or any FMLP
Operating Entity immediately prior to the Closing Date will be owned
or available for use by Buyer on substantially similar terms and
conditions immediately subsequent to the Closing Date and (C) to the
knowledge of FMLP, each FMLP Operating Entity has taken reasonable
commercial actions to maintain and protect each item of material
Intellectual Property in the Business.
<PAGE> 109

-5-

(iii) The Disclosure Schedule identifies each
patent or registration which has been issued to any FMLP Operating
Entity with respect to any of the Intellectual Property, identifies
each pending patent application or application for registration which
any FMLP Operating Entity has made with respect to any of the
Intellectual Property, and identifies each license or other agreement
which any FMLP Operating Entity has granted to any third party with
respect to any of the Intellectual Property. FMLP has delivered to
Buyer correct and complete copies of all such patents, registrations,
applications, licenses and agreements (as amended to date) and has
made available to Buyer correct and complete copies of all other
written documentation evidencing ownership and prosecution (if
applicable) of each such item. The Disclosure Schedule also
identifies each trade name or unregistered trademark having a value
used by any FMLP Operating Entity in connection with the Business.
Except as set forth on the Disclosure Schedule, with respect to each
item of Intellectual Property required to be identified in the
Disclosure Schedule: (A) each FMLP Operating Entity possesses all
right, title and interest in and to the item, free and clear of any
Encumbrances (other than Permitted Encumbrances) or licenses, (B) the
item is not subject to any outstanding injunction, judgment, order,
decree, ruling, or charge, (C) no Proceeding is pending or, to the
knowledge of FMLP, threatened which challenges the legality,
validity, enforceability, use or ownership of the item and (D) other
than routine indemnities given to distributors, sales
representatives, dealers and customers, no FMLP Operating Entity has
any current obligations to indemnify any Person for or against any
interference, infringement, misappropriation, or other conflict with
respect to the item.

-6-

except as may be limited by Enforceability Limitations, (C) no FMLP
Operating Entity nor, to the knowledge of FMLP, any other party to
the license, sublicense or other agreement is in material breach or
default, and no event has occurred which, with notice or lapse of
time, would constitute a breach or default or permit early
termination, modification or acceleration thereunder, (D) no FMLP
Operating Entity nor, to the knowledge of FMLP, any other party to
the license, sublicense or other agreement has repudiated any
provision thereof, (E) to the knowledge of FMLP, the underlying item
of Intellectual Property is not subject to any outstanding
injunction, judgment, order, decree, ruling or charge, (F) to the
knowledge of FMLP, no Proceeding is pending or threatened which
challenges the legality, validity or enforceability of the underlying
item of Intellectual Property and (G) no FMLP Operating Entity has
granted any sublicense or similar right with respect to the license,
sublicense or other agreement.

(m) Compliance with Laws; Permits. Except as set forth on
the Disclosure Schedule, the conduct of the Business is in compliance
in all material respects with all applicable Governmental
Requirements. No FMLP Operating Entity has received any notice to
the effect that, or otherwise been advised that, such FMLP Operating
Entity is not in compliance in all material respects with any
applicable Governmental Requirement and, to the knowledge of FMLP,
there are no presently existing facts, circumstances or events which,
with notice or lapse of time, would result in material violations of
any applicable Governmental Requirement. The Disclosure Schedule
identifies all material Permits issued to any FMLP Operating Entity
and currently in effect. Except as set forth on the Disclosure
Schedule, the Permits constitute all permits, consents, licenses,
franchises, authorizations and approvals used in the operation of and
necessary to conduct the Business. All of the Permits are valid and
in full force and effect, no violations have been experienced, noted
or recorded and no violations are expected, and no Proceeding is
pending or, to the knowledge of FMLP, threatened to revoke or limit
any of the Permits.

(n) Litigation. Except as set forth on the Disclosure
Schedule, there is no Proceeding pending or, to the knowledge of
FMLP, currently threatened against or relating to any FMLP
Operating Entity, its partners, shareholders, directors, officers or
employees, or its properties, assets or business relating to the
Business.

(o) Employment Matters
<PAGE> 111

-7-

(i) Employees Generally. The Disclosure Schedule
sets out true and accurate details as at the date of this Agreement
of: (A) the names, job description, dates of birth and dates of
commencement of employment of all employees; (B) all remuneration
payable, including any allowance, bonus and commission entitlement
and any other benefits provided or which FM-Australia is bound to
provide (whether now or in the future) to the employees; (C)
particulars of accrued long service leave, annual leave and sick
leave and rostered days off with respect to the employees; and (D)
particulars of any redundancy or severance pay owing as at the
estimated Closing Date.

(ii) Material Employment Terms. Except as set forth
on the Disclosure Schedule, FM-Australia does not have any: (A)
existing service or other agreements with any employee which cannot
be fairly terminated by 3 calendar months' notice or less without
giving rise to any claim for damages or compensation; (B) schemes or
arrangements for the payment of bonuses to employees; (C) share
option or share incentive or similar schemes for any employees; (D)
arrangement to pay moneys to any employee other than in respect of
remuneration or emoluments of employment; (E) liability for
compensation to ex-employees; (F) obligation to reinstate
ex-employees; (G) knowledge of grounds for dismissal of any employee;
(H) policy, practice or obligation regarding redundancy payments to
employees which is more generous than the applicable award(s) or
legislation; or (I) industrial agreement or enterprise agreement
(whether registered or not) or plans to introduce any such agreement
that applies to any employee.

(iii) Consultants, etc.. No person has any
agreement, arrangement or understanding with the FM-Australia
pursuant to which that person acts as a consultant or independent
contractor or in a similar capacity for the Australian Business
whether on a full time or a part time or retainer basis or otherwise.

(iv) Superannuation And Other Relevant Schemes.
Except as set forth on the Disclosure Schedule, FM-Australia does not
have any accrued liability, unfunded or contingent obligations with
respect to any superannuation, retirement benefit schemes or other
pension schemes or arrangements and there are no employment benefit
plans, program or arrangements such as medical, dental or life
insurance to which FM-Australia is a party or makes available or
procures for its employees or former employees ("Relevant Scheme").
Except as set forth on the Disclosure Schedule, FM-Australia has made
all occupational superannuation contributions required under any
award or prescribed industrial agreement in respect of any employees
and satisfied all applicable laws. Except as set forth on the
Disclosure Schedule, each Relevant Scheme has at all times been
administered in accordance with the relevant rules and/or trust
document and (in the case of superannuation schemes) in accordance
with all requirements which from time to time have needed to be
satisfied in order for the Relevant Scheme to qualify for the
maximum income tax concessions available to superannuation funds.
Except as set forth on the isclosure Schedule, FM-Australia has
provided at least the minimum level of superannuation support as
prescribed by the
<PAGE> 112

-8-

Superannuation Guarantee (Administration) Act 1992 in respect of each
employee and there is no superannuation guarantee charge or liability
accrued or payable in respect of employees.

(v) Agreements with Trade Unions. Except as set
forth on the Disclosure Schedule, FM-Australia is not a party to any
agreement, arrangement or understanding with any trade union or
employees organization of any kind, relating to the Australian
Business or the employees of the Australian Business.

(vi) Industrial Disputes. There is no existing,
threatened or pending industrial dispute or pay claim involving the
Australian Business or any employees of the Australian Business and
there are no facts or circumstances known to FM- Australia which are
likely to result in such an industrial dispute or pay claim.

(vii) Unions/Awards. Except as set forth on the
Disclosure Schedule, the employees of the Australian Business are not
members of any union or subject to any industrial award or
determination.

(viii) No Breach of Awards. FM-Australia has never
breached and is not in breach of any industrial award or
determination applicable to its employees.

(p) [Intentionally Deleted]

(q) Transactions with Certain Persons. Except as set
forth on the Disclosure Schedule or as otherwise disclosed in the
Australian Purchase Agreement, to the knowledge of FMLP, (i) no
Related Person is presently or at any time during the past one (1)
year has been a party to any transaction not on an arm's-length basis
with any FMLP Operating Entity including, without limitation, any
contract, agreement or other arrangement (A) providing for the
furnishing of services to or by, (B) providing for the rental or sale
of real or personal property to or from or (C) otherwise requiring
payments annually to or from (other than for services as officers or
employees of any FMLP Operating Entity), such Related Person and (ii)
no partner, shareholder, director, officer or employee of any FMLP
Operating Entity is related to any other partner, shareholder,
director, officer or employee of any FMLP Operating Entity by blood
or marriage. Except as set forth on the Disclosure Schedule, there
is no outstanding amount in excess of $500 owing (including, without
limitation, pursuant to any advance, note or other indebtedness
instrument) from any FMLP Operating Entity to any Related Person
identified on the Disclosure Schedule or from any Related Person
identified on the Disclosure Schedule to any FMLP Operating Entity.

-9-

general description of the type of coverage provided and policy
exclusions) maintained by any FMLP Operating Entity and relating to
such FMLP Operating Entity's properties, assets and personnel.
Except as set forth on the Disclosure Schedule, all of the Insurance
is "occurrence" based insurance. The Insurance is in full force and
effect and sufficient for compliance in all material respects with
all requirements of applicable law and of all contracts to which any
FMLP Operating Entity is a party. No FMLP Operating Entity is in
material default under any of the Insurance, and no FMLP Operating
Entity has failed to give any notice or to present any claim under
any of the Insurance in a due and timely manner. No notice of
cancellation, termination, reduction in coverage or increase in
premium (other than reductions in coverage or increases in premiums
in the ordinary course) has been received with respect to any of the
Insurance, and all premiums with respect to any of the Insurance have
been timely paid. No FMLP Operating Entity has experienced claims in
excess of current coverage of the Insurance. Except as disclosed on
the Disclosure Schedule, there will be no retrospective insurance
premiums or charges on or with respect to any of the Insurance for
any period or occurrence through the Closing Date.

(s) Inventory. Except as set forth on the Disclosure
Schedule, (i) all of the Inventory is owned by each FMLP Operating
Entity free and clear of any Encumbrances (other than Permitted
Encumbrances) and is located at the Current Real Property, (ii) none
of the Inventory is on consignment, (iii) the Inventory as reflected
in the Financial Statements and Interim Financial Statements has been
valued at the lower of cost (on a first-in, first-out basis) or
market value in a manner consistent with past practices and
procedures (including, without limitation, the method of computing
overhead and other indirect expenses to be applied to inventory) and
in accordance with GAAP and (iv) all inventory located at the Current
Real Property is owned by the FMLP Operating Entities and is not held
by the FMLP Operating Entities (on consignment or otherwise) for or
on behalf of any other Person.

(u) Material Contracts. The Disclosure Schedule contains
a true and correct list or description of the Material Contracts.
True and correct copies of the Material Contracts have been delivered
to Buyer. Each of the Material Contracts is enforceable against each
FMLP Operating Entity and, to the knowledge FMLP, each other party
thereto, in accordance with its terms, except as such enforcement may
be limited by Enforceability Limitations. No FMLP Operating Entity
nor, to the knowledge of FMLP, any other party to any Material
Contract, is in material default thereunder or in material breach
thereof, and no FMLP Operating Entity has during the past two (2)
years obtained or granted any material waiver of or under any
provision of any Material Contract except for routine waivers
granted or sought in the ordinary course of the Business. To the
knowledge of FMLP, there exists
<PAGE> 114

-10-

no event, occurrence, condition or act which constitutes or, with the
giving of notice, the lapse of time or the happening of any future
event or condition, would become a material default by any FMLP
Operating Entity or, to the knowledge of FMLP, any other party under
any Material Contracts. FMLP does not know of a threatened default
under any Material Contracts.

(v) Suppliers and Customers. The Disclosure Schedule
contain a list of the ten (10) largest suppliers and ten (10) largest
customers of the Business for calendar-year 1995. Except as set
forth on the Disclosure Schedule, to the knowledge of FMLP, none of
the suppliers of customers set forth on the Disclosure Schedule has
informed any FMLP Operating Entity that it intends to terminate its
relationship with any FMLP Operating Entity, and FMLP is not aware of
any such supplier or customer that intends to terminate such
relationship or of any material problem or dispute with any such
supplier or customer. Each FMLP Operating Entity believes that it
has good business relationships with each such supplier and customer.
FMLP does not believe that the consummation of a sale of the Business
will or is likely to disrupt the existing relationships with any such
supplier or customer in any material respect.

(x) Bank Accounts. The Disclosure Schedule contains a
true, complete and correct list of all bank accounts and safe deposit
boxes maintained by any FMLP Operating Entity and all persons
entitled to draw thereon, to withdraw therefrom or with access
thereto and a description of all lock box arrangements for any FMLP
Operating Entity.

-11-

used, generated, processed, treated, stored, disposed of or otherwise
handled at or transported from the Real Property or otherwise.
Except as set forth on the Disclosure Schedule, no FMLP Operating
Entity nor any Predecessor has received any notice of any other
claim, demand or action by any Person alleging any actual or
threatened injury or damage to any Person, property, natural resource
or the environment arising from or relating to the presence, Release
or threatened Release of any Hazardous Substances at, on, under, in,
to or from the Real Property or in connection with any operations or
activities thereat, or at, on, under, in, to or from any other
property. Neither the Real Property nor any operations or activities
thereat is or has been subject to any judicial or administrative
proceeding, order, consent, agreement or any lien relating to any
applicable Environmental Laws or Environmental Claims. Except as set
forth on the Disclosure Schedule, there are no underground storage
tanks presently located at the Current Real Property and there have
been no releases of any Hazardous Substances from any underground
storage tanks or related piping at the Current Real Property. Except
as set forth on the Disclosure Schedule, there are no PCBs located
at, on, under or in the Current Real Property. Except as set forth
on the Disclosure Schedule, to the knowledge of FMLP, there is no
asbestos or asbestos-containing material located at, on, under or in
the Current Real Property.

(z) Absence of Certain Changes. Except as set forth on
the Disclosure Schedule, since December 31, 1995 there has not been:

(i) any material adverse change in the Business,
financial condition or operations of the FMLP Operating Entities
conducting the Business taken as a whole.

(ii) any increase in the compensation of or granting
of bonuses payable or to become payable by any FMLP Operating Entity
to any officer or employee whose 1995 calendar-year compensation
(base salary plus bonus) exceeded $50,000, other than annual
increases or bonuses consistent with any FMLP Operating Entity's past
practices and not exceeding, for any such officer or employee, four
percent (4%) of such officer's or employee's 1995 calendar-year
compensation;

(v) any material change in accounting methods or
principles.
<PAGE> 116

-12-

(ac) Products; Product Warranties.

(i) A form of each product warranty relating to
products manufactured or sold by any FMLP Operating Entity at any
time during the two-year period preceding the date of the Australian
Purchase Agreement is attached to or set forth on the Disclosure
Schedule.

(iii) Except as set forth on the Disclosure
Schedule, FMLP is not aware of any defect in design, materials,
manufacture or otherwise in any products manufactured, distributed or
sold by any FMLP Operating Entity during the past
five (5) years or any defect in repair to any such products which
could give rise to any claims in excess of historical warranty
expenses; provided, however, that for purposes of this
<PAGE> 117

-13-

paragraph improvements made to products in the ordinary course of
business shall not be interpreted as an indication of the existence
of any defects.

(ad) Solvency, etc.

(i) Liquidation/Winding Up. Except as set forth on
the Disclosure Schedule, FM-Australia has not had a liquidator or
provisional liquidator appointed. Except as set forth on the
Disclosure Schedule, FM-Australia has not passed any resolution that
it be wound up. Except as set forth on the Disclosure Schedule, no
application for the winding up of FM-Australia has been made.

(ii) Execution. No execution, distress or similar
process has been levied upon or against all or any part of the
Australian Purchased Assets.

(iii) Schemes of Arrangement. FM-Australia has
not entered into any scheme of arrangement, composition, assignment
for the benefit of, or other arrangement with its creditors or any
class of creditors.

(iv) Receivers/Managers/etc. No receiver, receiver
and manager, trustee, controller, official manager or similar officer
has been appointed over all or part of the business, assets or
revenues of FM-Australia.

(v) Solvency. FM-Australia is able to pay its debts
as and when they fall due.

(vi) Unsatisfied Judgments. There is no unfulfilled
or unsatisfied judgment or court order outstanding against
FM-Australia in relating to the Australian Business or the Australian
Purchased Assets.
<PAGE> 118

SCHEDULE 4.4

REPRESENTATIONS AND WARRANTIES RELATING TO THE
GERMAN BUSINESS

1. [Intentionally Deleted]

2. [Intentionally Deleted]

3. [Intentionally Deleted]

4. [Intentionally Deleted]

5. [Intentionally Deleted]

6. Capitalization of FM-Germany. The Disclosure Schedule
sets forth the authorized, issued and outstanding capital stock of
FM-Germany, the ownership thereof and any Encumbrances thereon. That
capital stock is fully paid up in cash, no open or disguised capital
contribution in kind and no repayment of capital have occurred.
Except as set forth on the Disclosure Schedule, (i) there are no
securities of either of FM-Germany convertible into or exchangeable
or exercisable for shares of its capital stock, (ii) there are no
bonds, debentures, notes, or other indebtedness having the right to
vote on any matters on which FM-Germany's shareholders may vote,
(iii) there are no outstanding options, warrants, rights, contracts,
commitments, understandings or arrangements by which FM-Germany is
bound to issue, repurchase or otherwise acquire or retire any of its
securities and (iv) there are no voting agreements, voting trusts,
buy-sell agreements, options or rights or obligations relating to the
shareholders or the securities of FM-Germany.

7. Corporate Records. The corporate records of
FM-Germany contain a complete and accurate account of all material
meetings and actions of shareholders and directors of such
corporation, and of any executive committee or other committee of the
shareholders or board of directors of such corporation.

8. [Intentionally Deleted]

9. Tax Matters.

a. Except as set forth on the Disclosure Schedule,
to the knowledge of FMLP, (A) each FMLP Operating Entity has filed
all Tax Returns that it was required to file, (B) all Taxes required
to have been withheld in connection with amounts paid or owing to any
employee, independent contractor, creditor, stockholder or other
third party have been withheld, (C) all such Tax Returns were correct
and complete in all material respects, (D) all Taxes required to have
been paid by any FMLP Operating Entity (whether or not shown on any
Tax Return) have been paid, (E) no FMLP Operating Entity is currently
<PAGE> 119

-2-

the beneficiary of any extension of time within which to file any Tax
Return and (F) no claim has been made within the last five (5) years
by any Governmental Authority in a jurisdiction where any FMLP
Operating Entity does not file Tax Returns that it is or may be
subject to taxation by that jurisdiction. There are no Encumbrances
(other than Permitted Encumbrances) on any of the American Purchased
Assets, the FM-Service Shares or the FM-Brazil Shares that arose in
connection with any failure (or alleged failure) to pay any Tax.

b. To the knowledge of FMLP, no Governmental
Authority will assess any additional Taxes for any period for which
Tax Returns have been filed. There is no dispute or claim concerning
any Tax liability of any FMLP Operating Entity either (A) claimed or
raised by any Governmental Authority in writing or (B) as to which
FMLP has knowledge based upon personal contact with any agent of such
authority. The Disclosure Schedule lists all federal, state, local,
and foreign income Tax Returns filed with respect to any FMLP
Operating Entity for taxable periods ended on or after December 31,
1992, indicates those Tax Returns which have been audited, and
indicates those Tax Returns that currently are the subject of audit.
FMLP has delivered to Buyer correct and complete copies of all
federal income Tax Returns, examination reports, and statements of
deficiencies assessed against or agreed to by any FMLP Operating
Entity for taxable periods ended on or after December 31, 1992.

10. Real Property. The Disclosure Schedule contains a
true, complete and correct list of the Real Property now or in the
past owned or used by any FMLP Operating Entity for manufacturing.
Except as set forth on the Disclosure Schedule, (i) each FMLP
Operating Entity has title to the Current Real Property owned by such
FMLP Operating Entity, (ii) each FMLP Operating Entity enjoys
peaceful and undisturbed possession of the Current Real Property
leased by such FMLP Operating Entity, (iii) no interest of any FMLP
Operating Entity in the Current Real Property is subject to any
commitment for sale or use by any Person other than such FMLP
Operating Entity, (iv) no interest of any FMLP Operating Entity in
the Current Real Property is subject to any Encumbrances (other than
Permitted Encumbrances), which in any material respect interfere with
or impair the value, transferability or present and continued use
thereof in the usual and normal conduct of the Business, (v) no labor
has been performed or material furnished on behalf of or at the
request of any FMLP Operating Entity for the Current Real Property
for which a mechanic's or materialman's lien or liens, or any other
lien, has been claimed by any Person on any FMLP Operating Entity's
<PAGE> 120

-3-

interest in the Current Real Property, except to the extent that the
liability relating thereto is reflected on the Closing Date Financial
Report, (vi) the Current Real Property, and each user thereof, is in
compliance in all material respects with all applicable Governmental
Requirements and (vii) no material default or breach exists with
respect to any Encumbrance affecting any FMLP Operating Entity's
interest in the Current Real Property. There are no condemnation or
eminent domain proceedings pending or, to the knowledge of FMLP,
contemplated or threatened against any FMLP Operating Entity's
interest in the Current Real Property or any part thereof, and no
FMLP Operating Entity knows of any desire of any Governmental
Authority to take or use any FMLP Operating Entity's interest in the
Current Real Property or any part thereof. Except as set forth on
the Disclosure Schedule, there are no existing or, to the knowledge
of FMLP, contemplated or threatened general or special assessments
against any FMLP Operating Entity's interest in the Current Real
Property or any portion thereof. FMLP does not have any knowledge of
any pending or threatened Proceeding before any Governmental
Authority which relates to the ownership, maintenance, use or
operation of any FMLP Operating Entity's interest in the Current Real
Property (other than periodic general reassessments, which
reassessments, if any, are set forth on the Disclosure Schedule).
Except as set forth in the Disclosure Schedule, to the knowledge of
FMLP, the buildings and improvements on the Current Real Property
(including, without limitation, the heating, air conditioning,
mechanical, electrical and other systems used in connection
therewith) are in a reasonable state of repair, have been well
maintained and are free from infestation by termites, other wood
destroying insects, vermin and other pests. Except as set forth on
the Disclosure Schedule, there are no repairs or replacements
exceeding $100,000 in the aggregate for all Current Real Property or
$25,000 for any single repair or replacement which are currently
contemplated by any FMLP Operating Entity.

11. Tangible Personal Property. FMLP has delivered to
Buyer a list of each item of Tangible Personal Property owned by any
FMLP Operating Entity having a value in excess of $5,000, and a list
each item of Tangible Personal Property leased by any FMLP Operating
Entity (other than individual leases of office equipment having an
annual rental of less than $5,000). No FMLP Operating Entity is a
party to any lease for Tangible Personal Property which is required
to be capitalized under GAAP. There is no tangible personal property
used in the operation of the Business other than the Tangible
Personal Property. Except as set forth on the Disclosure Schedule,
the Tangible Personal Property owned by each FMLP Operating Entity is
free and clear of any Encumbrances (other than Permitted
Encumbrances). Except as set forth on the Disclosure Schedule, all
of the Tangible Personal Property is located at the Current Real
Property and there is no tangible personal property located at the
Current Real Property which is not owned or leased by any FMLP
Operating Entity. Except as set forth in the Disclosure Schedule,
to the knowledge of FMLP, the Tangible Personal Property is, taken
as a whole, in reasonable working order and adequate for its
intended use, ordinary wear and tear and normal repairs and
replacements excepted. Except as disclosed on the Disclosure
Schedule, there are no repairs or replacements exceeding $50,000 in
the aggregate for all Tangible Personal Property or $10,000 for any
single item of Tangible Personal Property which are currently
contemplated by any FMLP Operating Entity.
<PAGE> 121

-4-

12. Intellectual Property.

a. Except as set forth on the Disclosure Schedule,
(A) there is no intellectual property used in the Business other than
the Intellectual Property, (B) each item of Intellectual Property
owned or used by any FMLP Operating Entity immediately prior to the
Closing Date will be owned or available for use by Buyer on
substantially similar terms and conditions immediately subsequent to
the Closing Date and (C) to the knowledge of FMLP, each FMLP
Operating Entity has taken reasonable commercial actions to maintain
and protect each item of material Intellectual Property in the
Business.

b. Except as set forth on the Disclosure Schedule,
(A) no FMLP Operating Entity has during the last five (5) years
interfered with, infringed upon, misappropriated or otherwise come
into conflict with any intellectual property rights of third parties,
and no FMLP Operating Entity has received any charge, complaint,
claim, demand or notice alleging any such interference, infringement,
misappropriation or violation (including any claim that any FMLP
Operating Entity must license or refrain from using any intangible
property rights of any third party) which has not been resolved and
(B) to the knowledge of FMLP, no third party has interfered with,
infringed upon, misappropriated or otherwise come into conflict with
any of the Intellectual Property.

c. The Disclosure Schedule identifies each patent or
registration which has been issued to any FMLP Operating Entity with
respect to any of the Intellectual Property, identifies each pending
patent application or application for registration which any FMLP
Operating Entity has made with respect to any of the Intellectual
Property, and identifies each license or other agreement which any
FMLP Operating Entity has granted to any third party with respect to
any of the Intellectual Property. FMLP has delivered to Buyer
correct and complete copies of all such patents, registrations,
applications, licenses and agreements (as amended to date) and has
made available to Buyer correct and complete copies of all other
written documentation evidencing ownership and prosecution (if
applicable) of each such item. The Disclosure Schedule also
identifies each trade name or unregistered trademark having a value
used by any FMLP Operating Entity in connection with the Business.
Except as set forth on the Disclosure Schedule, with respect to each
item of Intellectual Property required to be identified in the
Disclosure Schedule: (A) each FMLP Operating Entity possesses all
right, title and interest in and to the item, free and clear of any
Encumbrances (other than Permitted Encumbrances) or licenses, (B) the
item is not subject to any outstanding injunction, judgment, order,
decree, ruling, or charge, (C) no Proceeding is pending or, to the
knowledge of FMLP, threatened which challenges the legality,
validity, enforceability, use or ownership of the item and (D) other
than routine indemnities given to distributors, sales
representatives, dealers and customers, no FMLP Operating Entity has
any current obligations to indemnify any Person for or against any
interference, infringement, misappropriation, or other conflict with
respect to the item.
<PAGE> 122

-5-

d. The Disclosure Schedule identifies each item of
Intellectual Property that any third party owns and that any FMLP
Operating Entity uses pursuant to license, sublicense or agreement,
other than off-the-shelf computer software subject to shrinkwrap
licenses. FMLP has delivered to Buyer correct and complete copies of
all such licenses, sublicenses and other agreements (as amended to
date). Except as set forth on the Disclosure Schedule, with respect
to each item of Intellectual Property required to be identified in
the Disclosure Schedule: (A) the license, sublicense or other
agreement covering the item is enforceable, except as may be limited
by Enforceability Limitations, (B) to the knowledge of FMLP,
following the Closing, the license, sublicense or other agreement
will continue to be enforceable on substantially similar terms and
conditions, except as may be limited by Enforceability Limitations,
(C) no FMLP Operating Entity nor, to the knowledge of FMLP, any other
party to the license, sublicense or other agreement is in material
breach or default, and no event has occurred which, with notice or
lapse of time, would constitute a breach or default or permit early
termination, modification or acceleration thereunder, (D) no FMLP
Operating Entity nor, to the knowledge of FMLP, any other party to
the license, sublicense or other agreement has repudiated any
provision thereof, (E) to the knowledge of FMLP, the underlying item
of Intellectual Property is not subject to any outstanding
injunction, judgment, order, decree, ruling or charge, (F) to the
knowledge of FMLP, no Proceeding is pending or threatened which
challenges the legality, validity or enforceability of the underlying
item of Intellectual Property and (G) no FMLP Operating Entity has
granted any sublicense or similar right with respect to the license,
sublicense or other agreement.

e. Except as set forth on the Disclosure Schedule,
to the knowledge of FMLP, Buyer's use of the Intellectual Property
will not interfere with, infringe upon, misappropriate, or otherwise
come into conflict with, any intangible property rights of third
parties as a result of the continued operation of the Business as
presently conducted and as presently proposed to be conducted.

13. Compliance with Laws; Permits. Except as set forth on
the Disclosure Schedule, the conduct of the Business is in compliance
in all material respects with all applicable Governmental
Requirements. No FMLP Operating Entity has received any notice to
the effect that, or otherwise been advised that, such FMLP Operating
Entity is not in compliance in all material respects with any
applicable Governmental Requirement and, to the knowledge of FMLP,
there are no presently existing facts, circumstances or events which,
with notice or lapse of time, would result in material violations of
any applicable Governmental Requirement. The Disclosure Schedule
identifies all material Permits issued to any FMLP Operating Entity
and currently in effect. Except as set forth on the Disclosure
Schedule, the Permits constitute all permits, consents, licenses,
franchises, authorizations and approvals used in the operation of
and necessary to conduct the Business. All of the Permits are valid
and in full force and effect, no violations have been experienced,
noted or recorded
<PAGE> 123

- 6 -

and no violations are expected, and no Proceeding is pending or, to
the knowledge of FMLP, threatened to revoke or limit any of the
Permits.

14. Litigation. Except as set forth on the Disclosure
Schedule, there is no Proceeding pending or, to the knowledge of
FMLP, currently threatened against or relating to any FMLP Operating
Entity, its partners, shareholders, directors, officers or employees,
or its properties, assets or business relating to the Business.

15. Labor Matters. a. The Disclosure Schedule identifies
for each current employee of any FMLP Operating Entity with a current
annual compensation (base salary plus bonus) in excess of $50,000,
his or her name, position or job title, his or her base compensation
and bonus compensation earned in calendar-year 1995, and his or her
current base compensation. Except as set forth on The Disclosure
Schedule, (A) no FMLP Operating Entity has any obligations under any
written or oral labor agreement, collective bargaining agreement or
other agreement with any labor organization or employee group, (B) no
FMLP Operating Entity is currently engaged in any unfair labor
practice and there is no unfair labor practice charge or other
employee-related or employment-related complaint against such FMLP
Operating Entity pending or, to the knowledge of FMLP, threatened
before any Governmental Authority, (C) there is currently no labor
strike, labor disturbance, slowdown, work stoppage or other material
labor dispute or arbitration pending or, to the knowledge of FMLP,
threatened against any FMLP Operating Entity and no material
grievance currently being asserted, (D) no FMLP Operating Entity has
experienced a labor strike, labor disturbance, slowdown, work
stoppage or other material labor dispute at any time during the three
years immediately preceding the date of this Agreement and (E) there
is, to the knowledge of FMLP, no organizational campaign being
conducted or contemplated and there is no pending or, to the
knowledge of FMLP, threatened petition before any Governmental
Authority or other dispute as to the representation of any employees
of any FMLP Operating Entity. Except as set forth on the Disclosure
Schedule, each FMLP Operating Entity has complied in all material
respects with, and is currently in compliance in all material
respects with, all applicable Governmental Requirements relating to
any of its employees or consultants (including, without limitation,
any Governmental Requirement of the Occupational Safety and Health
Administration), and no FMLP Operating Entity has received within the
past three (3) years any written notice of failure to comply with any
such Governmental Requirement which has not been rectified.

b. Except as set forth on the Disclosure Schedule,
to the knowledge of FMLP, all employees of any FMLP Operating Entity
are (A) German citizens, or lawful permanent residents of the
Germany, (B) aliens whose right to work in Germany is unrestricted,
(C) aliens who have valid, unexpired work authorization issued by the
relevant German authorities. Except as set forth on the Disclosure
Schedule, no FMLP Operating Entity has been the subject of an
immigration compliance or employment visit from, nor has
<PAGE> 124

-7-

any FMLP Operating Entity been assessed any fine or penalty by, or
been the subject of any order or directive of, the relevant German
authorities.

16. Employee Fringe Benefits. Except as set forth on the
Disclosure Schedule, FM-Germany has not granted to any of its
employees any insurance, pension commitment or other fringe benefit,
be it in the form of an individual undertaking or in the form of a
group or company plan. FM-Germany has made all payments due pursuant
to the relevant obligations and has made the maximum accruals
permissible under the tax laws for future obligations. All statutory
and contractual provisions that apply to any of the fringe benefits
have been properly fulfilled.

17. Transactions with Certain Persons. Except as set
forth on the Disclosure Schedule or as otherwise disclosed in this
Agreement, to the knowledge of FMLP, (i) no Related Person is
presently or at any time during the past one (1) year has been a
party to any transaction not on an arm's-length basis with any FMLP
Operating Entity including, without limitation, any contract,
agreement or other arrangement (A) providing for the furnishing of
services to or by, (B) providing for the rental or sale of real or
personal property to or from or (C) otherwise requiring payments
annually to or from (other than for services as officers or employees
of any FMLP Operating Entity), such Related Person and (ii) no
partner, shareholder, director, officer or employee of any FMLP
Operating Entity is related to any other partner, shareholder,
director, officer or employee of any FMLP Operating Entity by blood
or marriage. Except as set forth on the Disclosure Schedule, there
is no outstanding amount in excess of $500 owing (including, without
limitation, pursuant to any advance, note or other indebtedness
instrument) from any FMLP Operating Entity to any Related Person
identified on the Disclosure Schedule or from any Related Person
identified on the Disclosure Schedule to any FMLP Operating Entity.

18. Insurance. The Disclosure Schedule contains a
complete and accurate list of all current policies or binders of
Insurance (showing as to each policy or binder the carrier, policy
number, coverage limits, expiration dates, annual premiums,
deductibles and a general description of the type of coverage
provided and policy exclusions) maintained by any FMLP Operating
Entity and relating to such FMLP Operating Entity's properties,
assets and personnel. Except as set forth on the Disclosure
Schedule, all of the Insurance is "occurrence" based insurance. The
Insurance is in full force and effect and sufficient for compliance
in all material respects with all requirements of applicable law and
of all contracts to which any FMLP Operating Entity is a party. No
FMLP Operating Entity is in material default under any of the
Insurance, and no FMLP Operating Entity has failed to give any
notice or to present any claim under any of the Insurance in a due
and timely manner. No notice of cancellation, termination,
reduction in coverage or increase in premium (other than reductions
in coverage or increases in premiums in the ordinary course) has
been received with respect to any of the Insurance, and all premiums
with respect to any of the Insurance have been timely paid. No FMLP
Operating Entity has experienced claims
<PAGE> 125

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in excess of current coverage of the Insurance. Except as disclosed
on the Disclosure Schedule, there will be no retrospective insurance
premiums or charges on or with respect to any of the Insurance for
any period or occurrence through the Closing Date.

19. Inventory. Except as set forth on the Disclosure
Schedule, (i) all of the Inventory is owned by each FMLP Operating
Entity free and clear of any Encumbrances (other than Permitted
Encumbrances) and is located at the Current Real Property, (ii) none
of the Inventory is on consignment, (iii) the Inventory as reflected
in the Financial Statements and Interim Financial Statements has been
valued at the lower of cost (on a first-in, first-out basis) or
market value in a manner consistent with past practices and
procedures (including, without limitation, the method of computing
overhead and other indirect expenses to be applied to inventory) and
in accordance with GAAP and (iv) all inventory located at the Current
Real Property is owned by the FMLP Operating Entities and is not held
by the FMLP Operating Entities (on consignment or otherwise) for or
on behalf of any other Person.

20. Accounts Receivable. All of the Accounts Receivable
of each FMLP Operating Entity are bona fide receivables, are
reflected on the books and records of each FMLP Operating Entity and
arose in the ordinary course of the Business.

21. Material Contracts. The Disclosure Schedule contains
a true and correct list or description of the Material Contracts.
True and correct copies of the Material Contracts have been delivered
to Buyer. Each of the Material Contracts is enforceable against each
FMLP Operating Entity and, to the knowledge FMLP, each other party
thereto, in accordance with its terms, except as such enforcement may
be limited by Enforceability Limitations. No FMLP Operating Entity
nor, to the knowledge of FMLP, any other party to any Material
Contract, is in material default thereunder or in material breach
thereof, and no FMLP Operating Entity has during the past two (2)
years obtained or granted any material waiver of or under any
provision of any Material Contract except for routine waivers granted
or sought in the ordinary course of the Business. To the knowledge
of FMLP, there exists no event, occurrence, condition or act which
constitutes or, with the giving of notice, the lapse of time or the
happening of any future event or condition, would become a material
default by any FMLP Operating Entity or, to the knowledge of FMLP,
any other party under any Material Contracts. FMLP does not know of
a threatened default under any Material Contracts.

22. Suppliers and Customers. The Disclosure Schedule
contain a list of the ten (10) largest suppliers and ten (10) largest
customers of the Business for calendar-year 1995. Except as set
forth on the Disclosure Schedule, to the knowledge of FMLP, none of
the suppliers or customers set forth on the Disclosure Schedule has
informed any FMLP Operating Entity that it intends to terminate its
relationship with any FMLP Operating Entity, and FMLP is not aware of
any such supplier or customer that intends to terminate such
<PAGE> 126

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relationship or of any material problem or dispute with any such
supplier or customer. Each FMLP Operating Entity believes that it
has good business relationships with each such supplier and customer.
FMLP does not believe that the consummation of a sale of the Business
will or is likely to disrupt the existing relationships with any such
supplier or customer in any material respect.

23. Business Records. No material records of accounts,
personnel records and other business records for the past five (5)
years relating to the Business have been destroyed and all such
records are available upon request, subject to applicable
Governmental Requirements and/or contractual prohibitions or
limitations.

24. Bank Accounts. The Disclosure Schedule contains a
true, complete and correct list of all bank accounts and safe deposit
boxes maintained by any FMLP Operating Entity and all persons
entitled to draw thereon, to withdraw therefrom or with access
thereto and a description of all lock box arrangements for any FMLP
Operating Entity.

25. Environmental Matters. Except as set forth on the
Disclosure Schedule, each FMLP Operating Entity and its assets,
properties and operations are now and at all times prior to the
Closing Date have been in compliance in all material respects with
all applicable Environmental Laws. Except as set forth on the
Disclosure Schedule, each Predecessor of each FMLP Operating Entity
and its assets, properties and operations were in compliance in all
material respects with all applicable Environmental Laws. Except as
set forth on the Disclosure Schedule, and except in compliance with
Environmental Laws, there has been and is no Release or threatened
Release of any Hazardous Substance at, on, under, in, to or from any
of the Real Property, whether as a result of the operations and
activities at the Real Property or otherwise. Except as set forth on
the Disclosure Schedule, no FMLP Operating Entity nor any Predecessor
of any FMLP Operating Entity has received any notice of alleged,
actual or potential responsibility for, or any inquiry or
investigation regarding, the presence, Release or threatened Release
of any Hazardous Substance at any location, whether at the Real
Property or otherwise, which Hazardous Substances were allegedly
manufactured, used, generated, processed, treated, stored, disposed
of or otherwise handled at or transported from the Real Property or
otherwise. Except as set forth on the Disclosure Schedule, no FMLP
Operating Entity nor any Predecessor has received any notice of any
other claim, demand or action by any Person alleging any actual or
threatened injury or damage to any Person, property, natural resource
or the environment arising from or relating to the presence, Release
or threatened Release of any Hazardous Substances at, on, under, in,
to or from the Real Property or in connection with any operations or
activities thereat, or at, on, under, in, to or from any other
property. Neither the Real Property nor any operations or
activities thereat is or has been subject to any judicial or
administrative proceeding, order, consent, agreement or any lien
relating to any applicable Environmental Laws or Environmental
Claims. Except as set forth on the Disclosure Schedule, there are
no underground storage tanks presently located at the Current Real
Property and there have been
<PAGE> 127

-10-

no releases of any Hazardous Substances from any underground storage
tanks or related piping at the Current Real Property. Except as set
forth on the Disclosure Schedule, there are no PCBs located at, on,
under or in the Current Real Property. Except as set forth on the
Disclosure Schedule, to the knowledge of FMLP, there is no asbestos
or asbestos-containing material located at, on, under or in the
Current Real Property.

26. Absence of Certain Changes. Except as set forth on
the Disclosure Schedule, since December 31, 1995 there has not been:

a. any material adverse change in the Business,
financial condition or operations of the FMLP Operating Entities
conducting the Business taken as a whole.

b. any increase in the compensation of or granting
of bonuses payable or to become payable by any FMLP Operating Entity
to any officer or employee whose 1995 calendar-year compensation
(base salary plus bonus) exceeded $50,000, other than annual
increases or bonuses consistent with any FMLP Operating Entity's past
practices and not exceeding, for any such officer or employee, four
percent (4%) of such officer's or employee's 1995 calendar-year
compensation;

c. any sale or transfer by any FMLP Operating Entity
of any tangible or intangible asset having a value greater than
$5,000, any mortgage or pledge or creation of any Encumbrance
relating to any such asset, any lease of real property or equipment,
or any cancellation of any debt or claim, except in the ordinary
course of business;

d. any other material transaction not in the
ordinary course of the Business or not otherwise consistent with any
FMLP Operating Entity's past practices involving consideration in
excess of $50,000; or

e. any material change in accounting methods or
principles.

27. No Brokers. Except for FMLP's arrangement with Dean
Witter Reynolds, Inc., no FMLP Operating Entity has entered into any
agreement, arrangement or understanding with any Person which will
result in the obligation to pay any finder's fee, brokerage
commission or similar payment in connection with the transactions
contemplated by this Agreement.

28. Absence of Certain Payments. To the knowledge of
FMLP, no FMLP Operating Entity, nor any other Person owned or
controlled by FMLP, nor any of their respective partners,
shareholders, directors, officers, employees or agents, or other
people acting on behalf of any of them, have with respect to the
Business (i) engaged in any activity prohibited by the United States
Foreign Corrupt Practices Act of 1977 or any other similar
<PAGE> 128

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law, regulation or decree, directive or order of any Governmental
Authority or (ii) without limiting the generality of the preceding
clause (i), used any corporate or other funds for unlawful
contributions, payments, gifts or entertainment, or made any unlawful
expenditures relating to political activity to officials of any
Governmental Authority. To the knowledge of FMLP, no FMLP Operating
Entity, nor any Person owned or controlled by FMLP, nor any of their
partners, shareholders, directors, officers, employees or agents, or
other Persons acting on behalf of any of them, has accepted or
received any unlawful contributions, payments, gifts or expenditures.

29. Products; Product Warranties.

a. A form of each product warranty relating to
products manufactured or sold by any FMLP Operating Entity at any
time during the two-year period preceding the date of this Agreement
is attached to or set forth on the Disclosure Schedule.

b. The Disclosure Schedule sets forth a true and
complete list of (A) all products manufactured, marketed or sold by
any FMLP Operating Entity that have been recalled or withdrawn
(whether voluntarily or otherwise) at any time during the past three
(3) years (for purposes of this paragraph, a product shall have been
recalled or withdrawn if all or a substantial number of products in a
product line were recalled or withdrawn) and (B) all Proceedings
(whether completed or pending) at any time during the past five three
(3) years seeking the recall, withdrawal, suspension or seizure of
any product sold by any FMLP Operating Entity.

c. Except as set forth on the Disclosure Schedule,
FMLP is not aware of any defect in design, materials, manufacture or
otherwise in any products manufactured, distributed or sold by any
FMLP Operating Entity during the past five (5) years or any defect in
repair to any such products which could give rise to any claims in
excess of historical warranty expenses; provided, however, that for
purposes of this paragraph improvements made to products in the
ordinary course of business shall not be interpreted as an indication
of the existence of any defects.

d. The Disclosure Schedule sets forth on a
year-by-year basis, a true and complete list of all warranty expenses
and all other unreimbursed repair, maintenance and replacement
expenses incurred by any FMLP Operating Entity after January 1, 1993.

e. Except as provided in any of the standard product
warranties described in paragraph (i) of this Section and
as otherwise set forth on the Disclosure Schedule, no FMLP Operating
Entity has sold any products or services which are subject to an
extended warranty of such FMLP Operating Entity beyond 24 months and
which warranty has not yet expired.
<PAGE> 129

SCHEDULE 4.5

REPRESENTATIONS AND WARRANTIES RELATING TO BETHESDA
AND THE REAL PROPERTY

(a) Organization, Subsistence and Authority of Bethesda to
Conduct Business. Bethesda is a limited partnership, duly organized
and validly existing and in good standing under the laws of the State
of Illinois. Bethesda has full partnership power and authority to
conduct its business as it is presently being conducted and to own
and lease its properties and assets.

(b) Power and Authority; Authorization; Binding Effect.
Bethesda has all necessary power and authority and has taken all
action necessary to authorize, execute and deliver the Real Property
Purchase Agreement, to consummate the transactions contemplated by
the Real Property Purchase Agreement, and to perform its obligations
under the Real Property Purchase Agreement. The General Partners are
the only general partners of Bethesda and each General Partner has
all necessary power and authority and has taken all action necessary
to execute and deliver the Real Property Purchase Agreement. No
consent or other action of the Bethesda Limited Partners is required
for Bethesda to execute and deliver the Real Property Purchase
Agreement, to consummate the transactions contemplated by the Real
Property Purchase Agreement or to perform its obligation under the
Real Property Purchase Agreement. Copies of all resolutions of the
board of directors of each General Partner with respect to the
transactions contemplated by the Real Property Purchase Agreement,
certified by the Secretary or an Assistant Secretary of such General
Partner, in form reasonably satisfactory to counsel for Buyer, have
been delivered to Buyer. The Real Property Purchase Agreement has
been duly executed and delivered by Bethesda and constitutes a legal,
valid and binding obligation of Bethesda enforceable against Bethesda
in accordance with its terms, except as such enforcement may be
limited by Enforceability Limitations.

(c) No Conflict or Violation. The execution and delivery
of the Real Property Purchase Agreement, the consummation of the
transactions contemplated by the Real Property Purchase Agreement,
and the fulfillment of the terms of the Real Property Purchase
Agreement, do not and will not result in or constitute (i) a
violation of or conflict with any provision of the certificate of
limited partnership or limited partnership agreement of Bethesda,
(ii) a breach of, a loss of rights under, or constitute an event,
occurrence, condition or act which is or, with the giving of notice
or the lapse of time, would become, a material default under, or
result in the acceleration of any obligations under, any term or
provision of, any Bethesda Material Contract, Encumbrance, or
Material Permit to which Bethesda is a party, (iii) a material
violation by Bethesda of any statute, rule, regulation, ordinance,
code, order, judgment, writ, injunction, decree or award applicable
to Bethesda or (iv) an imposition of any Encumbrance on the Bethesda
Purchased Assets.
<PAGE> 130

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(d) Consents and Approvals. Except for any filings
required under the HSR Act which have been completed and with respect
to which early termination of the waiting period has been granted,
and otherwise as set forth on the Disclosure Schedule, no consent,
approval or authorization of, or declaration, filing or registration
with, any Person is required to be made or obtained by Bethesda in
connection with the execution, delivery and performance of the Real
Property Purchase Agreement and the consummation of the transactions
contemplated by the Real Property Purchase Agreement.

(e) No Proceedings. There is no Proceeding pending or, to
the knowledge of Bethesda, threatened in writing against or relating
to the transactions contemplated by the Real Property Purchase
Agreement.

(f) Financial Statements. Bethesda has delivered to Buyer
reviewed financial statements of Bethesda for the three-year period
ended December 31, 1995 (consisting of the review report, a balance
sheet, statement of income and retained earnings, a statement of cash
flows and all related footnotes), reviewed by Bethesda's Accountants
without qualification (the "Financial Statements"). The Financial
Statements fairly present the financial condition of Bethesda as of
their respective dates and for the periods then ended in accordance
with GAAP applied on a consistent basis.

(g) Wheeling Real Property. Except as set forth on the
Disclosure Schedule, (i) Bethesda has good, marketable and
indefeasible fee simple title to the Wheeling Real Property, (ii) the
Wheeling Real Property is not subject to any commitment for sale or
use by any Person other than the lease to Fluid Management, a true
and correct copy of which has been previously delivered to Buyer,
(iii) the Wheeling Real Property is not subject to any Encumbrance,
other than Bethesda Permitted Encumbrances, which in any material
respect interferes with or impairs the value, transferability or
present and continued use thereof in the usual and normal conduct of
the Business, (iv) no labor has been performed or material furnished
for the Wheeling Real Property for which a mechanic's or
materialman's lien or liens, or any other lien, has been or could be
claimed by any Person, except to the extent that the liability
related thereto is reflected on the Closing Date Financial Report,
(v) the Wheeling Real Property, and each user thereof, is in
compliance in all material respects with all applicable Governmental
Requirements (including, without limitation, all zoning, subdivision
and other applicable land use ordinances) and all existing covenants,
conditions, restrictions and easements, and the current use of the
Wheeling Real Property does not constitute a non-conforming use under
the applicable zoning ordinances, (vi) no material default or breach
exists with respect to any Encumbrance affecting the Wheeling Real
Property, (vii) there are no condemnation or eminent domain
proceedings pending or, to the knowledge of Bethesda, contemplated
or threatened, against the Wheeling Real Property or any part
thereof, and Bethesda does not know of any desire of any
Governmental Authority to take or use the Wheeling Real Property or
any part thereof, (viii) there are no existing, or to the knowledge
of Bethesda, contemplated or threatened, general or special
<PAGE> 131

-3-

assessments affecting the Wheeling Real Property or any portion
thereof, except for the drainage district assessments, (ix) the
Wheeling Real Property is not within any area determined to be
flood-prone under the Federal Flood Protection Act of 1973, or any
comparable state or local Governmental Requirement, (x) the Wheeling
Real Property is not situated in an area classified by any
Governmental Authority as being a "wetland" and (xi) Bethesda does
not have any knowledge of any pending or threatened Proceeding before
any Governmental Authority which relates to the ownership,
maintenance, use or operation of the Wheeling Real Property (other
than periodic general reassessments, which reassessments, if any, are
set forth on the Disclosure Schedule). Other than the property being
conveyed to Buyer under the Real Property Purchase Agreement, there
are no items, tangible or intangible, real or personal, owned by
Bethesda and used in conjunction with the Wheeling Real Property or
any portion thereof. Bethesda has not received any notices from any
insurance company of any defects or inadequacies in the Wheeling Real
Property or any part thereof which would materially and adversely
affect the insurability of the Wheeling Real Property or the premiums
for the insurance thereof, and no notice has been given by any
insurance company which has issued a policy with respect to any
portion of the Wheeling Real Property or by any board of fire
underwriters (or other body exercising similar functions) requesting
the performance of any repairs, alterations or other work which has
not been complied with. All water, sewer, gas, electric, telephone
and drainage facilities and all other utilities required by law or by
the normal use and operation of the Wheeling Real Property are
installed to the improvements situated on the Wheeling Real Property,
are connected pursuant to valid permits and are adequate to service
the Wheeling Real Property as currently used and to permit compliance
in all material respects with all Governmental Requirements and
normal usage of the Wheeling Real Property. Access to and from the
Wheeling Real Property is via public streets, which streets are
sufficient to ensure adequate vehicular and pedestrian access for the
present operation of the Business.

(h) Physical Condition of Buildings and Improvements.
Except as set forth in the Disclosure Schedule, to the knowledge of
FMLP, the buildings and improvements on the Wheeling Real Property
(including, without limitation, the heating, air conditioning,
mechanical, electrical and other systems used in connection
therewith) are in a reasonable state of repair, have been well
maintained and are free from infestation by termites, other wood
destroying insects, vermin and other pests. Except as set forth on
the Disclosure Schedule, there are no repairs or replacements
exceeding $100,000 in the aggregate for all Wheeling
Real Property or $25,000 for any single repair or replacement which
are currently contemplated by Bethesda.

(i) Compliance with Laws; Permits. The Wheeling Real
Property is in compliance in all material respects with all
applicable Governmental Requirements. Bethesda has not received any
notice to the effect that, or otherwise been advised that, Bethesda
is not in compliance in all material respects with any applicable
Governmental Requirement, and to the knowledge of Bethesda, there are
no presently existing facts, circumstances or events
<PAGE> 132

-4-

which, with notice or lapse of time, would result in material
violations of any applicable Governmental Requirement. The
Disclosure Schedule identifies all Permits issued to Bethesda and
currently in effect. The Permits constitute all permits, consents,
licenses, franchises, authorizations and approvals used in the
operation of and necessary to conduct the Business. All of the
Permits are valid and in full force and effect, no violations have
been experienced, noted or recorded and no violations are expected,
and no Proceeding is pending or, to the knowledge of Bethesda,
threatened to revoke or limit any of the Permits.

(j) Bethesda Contracts. The Disclosure Schedule contains
a true and correct list of the Bethesda Contracts. True and correct
copies of the Bethesda Contracts have been delivered to Buyer. Each
of the Bethesda Contracts is enforceable against Bethesda and, to the
knowledge of Bethesda, each other party thereto, in accordance with
its terms, except as such enforcement may be limited by the
Enforceability Limitations. Neither Bethesda nor, to the knowledge
of Bethesda, any other party thereto, is in material default
thereunder or in breach thereof. To the knowledge of Bethesda, there
exists no event, occurrence, condition or act which constitutes or,
with the giving of notice, the lapse of time or the happening of any
future event or condition, would become in default by Bethesda, or to
the knowledge of Bethesda, any other party under any Bethesda
Contracts.

(k) Environmental Matters. Except as set forth on the
Disclosure Schedule, Bethesda and its assets, properties and
operations are now and at all times prior to the Closing Date have
been in compliance in all material respects with all applicable
Environmental Laws. Except as set forth on the Disclosure Schedule,
each Predecessor of Bethesda, and its assets, properties and
operations were in compliance in all material respects with all
applicable Environmental Laws. Except as set forth on the Disclosure
Schedule, and except in compliance with Environmental Laws, there has
been and is no Release or threatened Release of any Hazardous
Substance at, on, under, in, to or from any of the Wheeling Real
Property, whether as a result of the operations and activities at the
Wheeling Real Property or otherwise. Except as set forth on the
Disclosure Schedule, neither Bethesda nor any Predecessor has
received any notice of alleged, actual or potential responsibility
for, or any inquiry or investigation regarding, the presence, Release
or threatened Release of any Hazardous Substance at any location,
whether at the Wheeling Real Property or otherwise, which Hazardous
Substances were allegedly manufactured, used, generated, processed,
treated, stored, disposed of or otherwise handled at or transported
from the Wheeling Real Property or otherwise. Except as set forth on
the Disclosure Schedule, neither Bethesda nor any Predecessor has
received any notice of any other claim, demand or action by any
Person alleging any actual or threatened injury or damage to any
Person, property, natural resource or the environment arising from
or relating to the presence, Release or threatened Release of any
Hazardous Substances at, on, under, in, to or from the
Wheeling Real Property or in connection with any operations or
activities thereat, or at, on, under, in, to or from any other
property. Neither the Wheeling Real Property nor any operations or
activities thereat is or has been subject to any judicial or
administrative proceeding, order, consent, agreement or
<PAGE> 133

-5-

any lien relating to any applicable Environmental Laws or
Environmental Claims. Except as set forth on the Disclosure
Schedule, there are no underground storage tanks presently located at
the Current Real Property and there have been no releases of any
Hazardous Substances from any underground storage tanks or related
piping at the Current Real Property. Except as set forth on the
Disclosure Schedule, there are no PCBs located at, on, under or in
the Current Real Property. Except as set forth on the Disclosure
Schedule, to the knowledge of FMLP, there is no asbestos or
asbestos-containing material located at, on, under or in the Current
Real Property.

(l) Documents. The Disclosure Schedule contains a true
and correct list of the Documents. True and correct copies of the
Documents have been delivered to Buyer. Except as set forth in the
Disclosure Schedule, Bethesda has good and marketable title to the
Documents.

(m) No Brokers. Except for FMLP's arrangement with Dean
Witter Reynolds, Inc., Bethesda has not entered into any agreement,
arrangement or understanding with any Person which will result in the
obligation to pay any finder's fee, brokerage commission or similar
payment in connection with the transactions contemplated by the Real
Property Purchase Agreement.
<PAGE> 134

SCHEDULE 6.3

REQUIRED CONSENTS AND FILINGS

Dunn Edwards Related Matters:

1. Weight Loop System Agreement dated February 25, 1992
between Dunn Edwards Corporation and FMLP.

2. Consulting Agreement between Dunn Edwards Corporation and
FMLP, as successor to Miller Print Corporation.

3. Consulting Agreement between Kenneth Edwards and FMLP
signed by FMLP on August 30, 1993.

4. Dunn Edwards Royalty Letter Agreement dated January 1,
1992.

Datacolor Related Matters:

1. 1995 Distributorship Agreement for Point-of-Sale Products
dated September 15, 1995 between FMLP and ACS Acquisition
Corp.

2. 1995 Distributorship Agreement for ink dispensing products
dated September 15, 1995 between FMLP and ACS Acquisition
Corp.

3. Asset Purchase Agreement, dated September 15, 1995, among
FM-U.K., FMLP and Texicon LTD.

4. Software Agreement between Datacolor and FMLP dated
September 15, 1995.

Joint Venture and Acquisition Agreements:

1. Exploitation Agreement, dated August 31, 1995, with
Technotek BV.

2. Confidentiality and Non-Competition Agreement dated
February 7, 1996, with Largo Innova, A.B.

License and Software Agreements:
<PAGE> 135

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1. License Agreement, dated November 1, 1981 between FMLP
(purchased from Harbil Manufacturing Company, successor to
Chicago Commutator Inc.) and Sears, Roebuck and Co.

2. Purchase Agreement, dated July 28, 1988, between Effective
Management Systems of Illinois and FMLP as successor to
Miller Paint Equipment, Ltd.

3. Software Development Agreement, dated May 22, 1995, between
FM-Holland and ADIS, B.V.

Real Property Leases:

1. Lease of 599 S. Wheeling Road Property dated August 2,
1995, between NETCOM and FMLP (expires December 31, 1996).

2. Palladium Netherland lease with FM-Holland for Hub van
Doorneweg 21-31 dated May 29, 1995.

3. B.V. Beleggingsfonds Hoogh Blarick and B.V.
Beleggingsfonds Savosa lease with FM-Holland for Hub van
Doorneweg 2 dated April 1, 1996.

4. B.V. Beleggingsfonds Hoogh Blarick and B.V.
Beleggingsfonds Savosa lease with FM-Holland for Hub van
Doorneweg 4 dated April 10, 1996.

5. Kwakkenbos Belgging B.V. lease with FM-Holland for
Edisonweg 21, Woerden dated February 1996.

6. B.V. Radix and Verman Beheer lease with FM-Holland for
Edisonweg 23, Woerden dated February 12, 1996.

7. Lease dated July 7, 1993, between Strastint Investments
Pty. Ltd. and FM-Australia as successor to Strastint
International Limited Partnership.

8. Lease between La Societe Europeene de Location d'Immeubles
Commerciaux et Industrials (Selcomi) and FM-France dated
August 2, 1995.

9. Lease dated April 28, 1994, between Northern American Life
Insurance Company and Fluid Management Services, Inc. with
respect to 140-150 Milner Avenue, Scarborough, Ontario.
<PAGE> 136

-3-

10. License Agreement between Strastint International Limited
Partnership and Commercial Dynamics Pty. Limited.

11. Uwe Salchow Lease with FM-Germany as successor to Fluid
Verfahrenstechnik dated June 18, 1991.

12. Uwe Salchow Lease Assignment with FM-Germany dated March
31, 1994.

13. Uwe Salchow Lease with FM-Germany dated November 8, 1994.

14. Irvine Baynard Lease with FM-UK dated 1993.

15. Direktor Stin Akstam M.F.L. lease for FM-Sweden dated May
20, 1991. This lease has been terminated as of December
31, 1996 at the latest and possibly as early as September
30, 1996.

16. Lease between FM-Sweden and Diligentia dated June 15, 1996.

17. Cubientas y Mzov S.A. lease with FM-Spain dated June 16,
1995.

18. Lease dated July 27, 1995 between FM-UK and District of
Wrekin Council for Unit 3 Trench Lock Industrial Estate,
Telford, Shropshire.

Personal Property Leases:

1. Master Lease Purchase Agreement with MetLife Capital
Corporation dated December 29, 1992, with Amendments #1,
#2, #5, #6, #7, #8, and #9.
<PAGE> 137

SCHEDULE 8.7

INDIVIDUALS EXECUTING STANDARDS OF CONDUCT AND BUSINESS
ETHICS POLICY AND EMPLOYEE INVENTIONS
AND CONFIDENTIALITY AGREEMENT

Mitchell H. Saranow
Joseph C. Rygiel
Thomas Carney
Michael Kudia

<PAGE> 1
EXHIBIT 4.2(b)

SECOND SUPPLEMENTAL INDENTURE

THIS SECOND SUPPLEMENTAL INDENTURE is dated as of July 29, 1996 by and
among IDEX CORPORATION, a Delaware corporation, as Issuer (the "Company"),
BAND-IT-IDEX, INC., a Delaware corporation ("Band-It"), CORKEN, INC., a
Delaware corporation ("Corken"), PULSAFEEDER, INC., a Delaware corporation
("Pulsafeeder"), VIBRATECH, INC., a Delaware corporation ("Vibratech"), VIKING
PUMP, INC., a Delaware corporation ("Viking"), WARREN RUPP, INC., a Delaware
corporation ("Warren Rupp"), LUBRIQUIP, INC., a Delaware corporation
("Lubriquip"), STRIPPIT, INC., a Delaware corporation ("Strippit," and together
with Band-It, Corken, Pulsafeeder, Vibratech, Viking, Warren Rupp and
Lubriquip, each an "Original Guarantor" and collectively, the "Original
Guarantors"), HALE PRODUCTS, INC., a Pennsylvania corporation ("Hale"),
MICROPUMP, INC., a Delaware corporation ("Micropump"), DUNJA
VERWALTUNGSGESELLSCHAFT MBH, a German corporation ("Dunja," and together with
Hale and Micropump, each a "Supplemental Guarantor" and collectively, the
"Supplemental Guarantors"), FLUID MANAGEMENT, INC., a Delaware corporation
("Fluid Management"), FMI MANAGEMENT COMPANY, an Illinois corporation ("FMI,"
and together with the Original Guarantors, the Supplemental Guarantors and
Fluid Management, the "Guarantors"), and Fleet National Bank (formerly known as
Fleet National Bank of Connecticut, which was formerly known as Shawmut Bank
Connecticut, National Association, which was formerly known as The Connecticut
National Bank), a national banking association, as trustee (the "Trustee").

RECITALS

WHEREAS, the Company, the Original Guarantors and the Trustee entered into
an Indenture, dated as of September 15, 1992 (as amended from time to time, the
"Indenture"), pursuant to which the Company issued $75,000,000 in principal
amount of 9 3/4% Senior Subordinated Notes due 2002 (the "Securities")
(capitalized terms used herein without definition shall have the respective
meanings ascribed to them in the Indenture);

WHEREAS, the Company, the Original Guarantors, the Trustee and the
Supplemental Guarantors entered into a First Supplemental Indenture, dated as
of December 22, 1995 (the "First Supplemental Indenture"), pursuant to which
each of the Supplemental Guarantors became a Guarantor under the Indenture;

WHEREAS, Section 11.03 of the Indenture provides that any person that was
not a Guarantor on the date of the Indenture may become a Guarantor by
executing and delivering to the Trustee, among other things, a supplemental
indenture in form and substance satisfactory to the Trustee;

WHEREAS, Section 9.01 of the Indenture provides, among other things, that
the Company and the Guarantors, when authorized by a Board Resolution of their
respective Boards of Directors, and the Trustee may amend, waive or supplement
the Indenture without notice to or consent of any Securityholder to make any
change that would provide any

<PAGE> 2

additional benefit or rights to the Securityholders or that does not adversely
affect the rights of any Securityholder;

WHEREAS, the Company, the Guarantors and the Trustee desire to supplement
the Indenture to include Fluid Management and FMI (each a "New Guarantor" and
collectively, the "New Guarantors") as Guarantors under the Indenture, and each
New Guarantor has agreed to guarantee the Securities pursuant to Article Eleven
of the Indenture;

WHEREAS, all acts and things prescribed by the Indenture, by law and by
the respective Certificates of Incorporation and By-Laws of the Company, the
Guarantors and the Trustee necessary to make this Second Supplemental Indenture
a valid instrument legally binding on the Company, the Guarantors and the
Trustee, in accordance with its terms, have been duly done and performed.

NOW, THEREFORE, to comply with the provisions of the Indenture and in
consideration of the above premises, the Company, the Guarantors and the
Trustee covenant and agree for the equal and proportionate benefit of the
respective Holders of the Securities as follows:

ARTICLE 1

Section 1.01. This Second Supplemental Indenture is supplemental to
the Indenture and does and shall be deemed to form a part of, and shall be
construed in connection with and as part of, the Indenture for any and all
purposes, including but not limited to discharge of the Indenture as provided
in Article 8 of the Indenture.

Section 1.02 . Subject to the provisions of Article Eleven of the
Indenture, each New Guarantor agrees that it will duly and punctually perform
and observe all of the covenants and conditions in the Indenture to be
performed by a Guarantor as if such New Guarantor had been an original
Guarantor of the Securities. Any Guarantee endorsed on any Security delivered
after the date of this Second Supplemental Indenture in substitution or
exchange for any outstanding Security as provided in the Indenture shall be
executed and delivered by each New Guarantor and each such Guarantee on each
such Security shall constitute an obligation of such New Guarantor; provided,
however, that each Guarantee hereunder shall be effective without such
notation.

Section 1.03 . This Second Supplemental Indenture shall become
effective immediately upon its execution and delivery by each of the Company,
the Guarantors and the Trustee.

ARTICLE 2

Section 2.01 . Except as specifically modified herein, the Indenture,
the Securities and the Guarantees are in all respects ratified and confirmed
and shall remain in full force and effect in accordance with their terms.

<PAGE> 3
Section 2.02. Except as otherwise expressly provided herein, no duties,
responsibilities or liabilities are assumed, or shall be construed to be
assumed, by the Trustee by reason of this Second Supplemental Indenture. This
Second Supplemental Indenture is executed and accepted by the Trustee subject
to all the terms and conditions set forth in the Indenture with the same force
and effect as if those terms and conditions were repeated at length herein and
made applicable to the Trustee with respect hereto.

Section 2.03. The laws of the State of New York shall govern this
Second Supplemental Indenture without regard to principles of conflicts of law.
The Trustee, the Company, the Guarantors and the Securityholders agree to
submit to the jurisdiction of the courts of the State of New York in any action
or proceeding arising out of or relating to this Second Supplemental Indenture.

Section 2.04. The parties may sign any number of copies of this
Second Supplemental Indenture. Each signed copy shall be an original, but all
of such executed copies together shall represent the same agreement.

Section 2.05. The recitals to this Second Supplemental Indenture shall
not be construed as representations of the Trustee and the Trustee makes no
representation as to the accuracy of such recitals.

Section 2.06. The Trustee enters into this Second Supplemental
Indenture in its capacity as Trustee under the Indenture and in reliance on an
Opinion of Counsel and an Officers' Certificate.

[signature page follows]

<PAGE> 4

SIGNATURES

IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed, all as of the date first written
above.

IDEX CORPORATION,
as Issuer

By: /s/ WAYNE P. SAYATOVIC
-------------------------
Name: Wayne P. Sayatovic
Title: Senior Vice President - Finance,
Chief Financial Officer and Secretary

BAND-IT-IDEX, INC.
CORKEN, INC.
PULSAFEEDER, INC.
VIBRATECH, INC.
VIKING PUMP, INC.
WARREN RUPP, INC.
LUBRIQUIP, INC.
STRIPPIT, INC.
HALE PRODUCTS, INC.
MICROPUMP, INC.
DUNJA VERWALTUNGSGESELLSCHAFT MBH
FLUID MANAGEMENT, INC.
FMI MANAGEMENT COMPANY,
as Guarantors

By: /s/ WAYNE P. SAYATOVIC
--------------------------------
Name: Wayne P. Sayatovic
Title: Vice President, Secretary and
Chief Financial Officer

FLEET NATIONAL BANK,
as Trustee

By: /s/ STEVEN CIMALORE
--------------------------------
Name: Steven Cimalore
Title: Vice-President

<PAGE> 1

EXHIBIT 4.5

================================================================================

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

DATED AS OF JULY 17, 1996

AMONG

IDEX CORPORATION

BANK OF AMERICA ILLINOIS,
AS AGENT,

AND

THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO

ARRANGED BY

BA SECURITIES, INC.

================================================================================

<PAGE> 2

TABLE OF CONTENTS

Section Page

BACKGROUND................................................................. 1

ARTICLE I

DEFINITIONS ....................................................... 2
1.01 Certain Defined Terms........................................ 2
1.02 Other Interpretive Provisions................................ 26
1.03 Accounting Principles........................................ 27
1.04 Currency Equivalents Generally .............................. 27

ARTICLE II

THE CREDITS ....................................................... 27
2.01 Amounts and Terms of Commitments............................. 27
2.02 Loan Accounts................................................ 28
2.03 Procedure for Committed Borrowing............................ 28
2.04 Conversion and Continuation Elections for Committed Loans.... 29
2.05 Utilization of Revolving Commitments in Offshore Currencies.. 31
2.06 Bid Borrowings............................................... 33
2.07 Procedure for Bid Borrowings................................. 33
2.08 Reduction of Commitments; Mandatory Prepayments.............. 37
(a) Scheduled Reductions.................................... 37
(b) Voluntary Termination or Reduction of Commitments....... 37
2.09 Optional Prepayments......................................... 38
2.10 Currency Exchange Fluctuations............................... 38
2.11 Mandatory Prepayments and Repayment.......................... 38
(a) Mandatory Prepayments of Loans.......................... 38
(b) Repayment............................................... 39
2.12 Interest..................................................... 39
2.13 Fees......................................................... 40
(a) Arrangement, Agency Fees................................ 40
(b) Amendment Fee........................................... 40
(c) Facility Fees........................................... 40
2.14 Computation of Fees and Interest............................. 40
2.15 Payments by the Company...................................... 41
2.16 Payments by the Banks to the Agent........................... 41
2.17 Sharing of Payments, Etc..................................... 42
2.18 Effect of Amendment and Restatement.......................... 43

ii
<PAGE> 3
Section Page

ARTICLE III

THE LETTERS OF CREDIT............................................. 43
3.01 The Letter of Credit Subfacility............................ 43
3.02 Issuance, Amendment and Renewal of Letters of Credit........ 44
3.03 Risk Participations, Drawings and Reimbursements............ 46
3.04 Repayment of Participations................................. 48
3.05 Role of the Issuing Bank.................................... 48
3.06 Obligations Absolute........................................ 49
3.07 Letter of Credit Fees....................................... 50
3.08 Uniform Customs and Practice................................ 50
3.09 Outstanding Letters of Credit............................... 51

ARTICLE IV

TAXES, YIELD PROTECTION AND ILLEGALITY............................ 51
4.01 Taxes....................................................... 51
4.02 Illegality.................................................. 52
4.03 Increased Costs and Reduction of Return..................... 53
4.04 Funding Losses.............................................. 54
4.05 Inability to Determine Rates................................ 54
4.06 Reserves on Offshore Rate Loans............................. 55
4.07 Certificates of Banks....................................... 55
4.08 Substitution of Banks....................................... 55
4.09 Survival.................................................... 56

ARTICLE V

CONDITIONS PRECEDENT.............................................. 56
5.01 Conditions of Initial Loans.................................. 56
(a) Loan Documents.......................................... 56
(b) Resolutions; Incumbency................................. 56
(c) Organization Documents; Good Standing................... 57
(d) Legal Opinions.......................................... 57
(e) Payment of Fees......................................... 57
(f) Certificate............................................. 57
(g) Other Documents......................................... 57
5.02 Conditions to All Credit Extensions.......................... 57
(a) Notice of Borrowing or Issuance......................... 58
(b) Continuation of Representations and Warranties.......... 58
(c) No Existing Default..................................... 58

iii
<PAGE> 4
Section Page

ARTICLE VI

REPRESENTATIONS AND WARRANTIES.................................... 58
6.01 Corporate Existence and Power............................... 58
6.02 Corporate Authorization: No Contravention................... 59
6.03 Governmental Authorization.................................. 59
6.04 Binding Effect.............................................. 59
6.05 Litigation.................................................. 59
6.06 No Default.................................................. 59
6.07 ERISA Compliance............................................ 60
6.08 Use of Proceeds; Margin Regulations......................... 61
6.09 Title to Properties......................................... 61
6.10 Taxes....................................................... 61
6.11 Financial Condition......................................... 61
6.12 Environmental Matters....................................... 61
6.13 Regulated Entities.......................................... 62
6.14 Subsidiaries................................................ 62
6.15 Insurance................................................... 62
6.16 Swap Obligations............................................ 62
6.17 Subordinated Debt........................................... 62
6.18 Security Documents.......................................... 62
6.19 Full Disclosure............................................. 63

ARTICLE VII

AFFIRMATIVE COVENANTS............................................. 63
7.01 Financial Statements........................................ 63
7.02 Certificates; Other Information............................. 64
7.03 Notices..................................................... 65
7.04 Preservation of Corporate Existence, Etc.................... 66
7.05 Maintenance of Property..................................... 66
7.06 Insurance................................................... 66
7.07 Payment of Tax Obligations.................................. 66
7.08 Compliance with Laws........................................ 67
7.09 Compliance with ERISA....................................... 67
7.10 Inspection of Property and Books and Records................ 67
7.11 Environmental Laws.......................................... 67
7.12 Use of Proceeds............................................. 67
7.13 Additional Guarantors....................................... 67

<PAGE> 5
Section Page

ARTICLE VIII

NEGATIVE AND FINANCIAL COVENANTS..................................... 68
8.01 Limitation on Liens............................................ 68
8.02 Disposition of Assets.......................................... 70
8.03 Consolidations and Mergers..................................... 71
8.04 Loans and Investments.......................................... 71
8.05 Limitation on Indebtedness..................................... 73
8.06 Transactions with Affiliates................................... 74
8.07 Contingent Obligations......................................... 75
8.08 Restricted Payments............................................ 75
8.09 ERISA.......................................................... 76
8.10 Change in Business............................................. 76
8.11 Accounting Changes............................................. 77
8.12 Modifications, etc. of Subordinated Debt and Related Documents. 77
8.13 Sale-Leasebacks................................................ 77
8.14 No Negative Pledges; Subsidiary Payments....................... 77
8.15 Foreign Operations............................................. 77
8.16 Financial Covenants............................................ 77
(a) Fixed Charge Coverage Ratio............................... 77
(b) Leverage Ratio............................................ 78
(c) Funded Debt to EBITDA..................................... 78

ARTICLE IX

EVENTS OF DEFAULT.................................................... 78
9.01 Event of Default............................................... 78
(a) Non-Payment................................................ 78
(b) Representation or Warranty................................. 78
(c) Specific Defaults.......................................... 78
(d) Other Defaults............................................. 78
(e) Cross-Default.............................................. 79
(f) Insolvency; Voluntary Proceedings.......................... 79
(g) Involuntary Proceedings.................................... 79
(h) ERISA...................................................... 80
(i) Monetary Judgments......................................... 80
(j) Change of Control.......................................... 80
(k) Guarantor Defaults......................................... 80
(l) Invalidity of Subordination Provisions..................... 80
9.02 Remedies....................................................... 80
9.03 Rights Not Exclusive........................................... 81

v
<PAGE> 6
Section Page

ARTICLE X

THE AGENT.......................................................... 81
10.01 Appointment and Authorization; "Agent"...................... 81
10.02 Delegation of Duties........................................ 82
10.03 Liability of Agent.......................................... 82
10.04 Reliance by Agent........................................... 82
10.05 Notice of Default........................................... 83
10.06 Credit Decision............................................. 83
10.07 Indemnification of Agent.................................... 83
10.08 Agent in Individual Capacity................................ 84
10.09 Successor Agent............................................. 84
10.10 Withholding Tax............................................. 84

ARTICLE XI................................................................. 86

MISCELLANEOUS...................................................... 86
11.01 Amendments and Waivers...................................... 86
11.02 Notices..................................................... 87
11.03 No Waiver; Cumulative Remedies.............................. 87
11.04 Costs and Expenses.......................................... 87
11.05 Company Indemnification..................................... 88
11.06 Payments Set Aside.......................................... 88
11.07 Successors and Assigns...................................... 89
11.08 Assignments, Participations, etc............................ 89
11.09 Designated Bidders.......................................... 90
11.10 Confidentiality............................................. 90
11.11 Set-off..................................................... 91
11.12 Automatic Debits of Fees.................................... 91
11.13 Notification of Addresses, Lending Offices, Etc............. 92
11.14 Counterparts................................................ 92
11.15 Severability................................................ 92
11.16 No Third Parties Benefited.................................. 92
11.17 Governing Law and Jurisdiction.............................. 92
11.18 Waiver of Jury Trial........................................ 93
11.19 Judgment.................................................... 93
11.20 Senior Debt................................................. 94
11.21 Entire Agreement............................................ 94

vi
<PAGE> 7
SCHEDULES

Schedule 2.01 Commitments
Schedule 6.05 Litigation
Schedule 6.07 ERISA
Schedule 6.11 Permitted Liabilities
Schedule 6.12 Environmental Matters
Schedule 6.14 Subsidiaries and Minority Interests
Schedule 6.15 Insurance Matters
Schedule 8.01 Permitted Liens
Schedule 8.04 Permitted Investments
Schedule 8.05 Permitted Indebtedness
Schedule 8.07 Contingent Obligations
Schedule 11.02 Lending Offices; Addresses for Notices

EXHIBITS

Exhibit 1.01A Form of Amended and Restated Pledge Agreement
Exhibit 1.01B Form of Amended and Restated Subsidiary Guaranty
Agreement
Exhibit 2.02 Form of Promissory Note
Exhibit 2.03(a) Form of Notice of Borrowing
Exhibit 2.04 Form of Notice of Conversion/Continuation
Exhibit 2.07(a) Form of Competitive Bid Request
Exhibit 2.07(b) Form of Invitation for Competitive Bids
Exhibit 2.07(c) Form of Competitive Bid
Exhibit 5.01(d) Form of Legal Opinion of Company's Counsel
Exhibit 7.02(b) Form of Compliance Certificate
Exhibit 11.08 Form of Assignment and Acceptance Agreement
Exhibit 11.09 Form of Designation Agreement

vii
<PAGE> 8

THIRD AMENDED AND RESTATED CREDIT AGREEMENT

This THIRD AMENDED AND RESTATED CREDIT AGREEMENT is entered into as of July
17, 1996, among IDEX Corporation, a Delaware corporation (the "Company"), the
several financial institutions from time to time party to this Agreement
(collectively, the "Banks"; individually, a "Bank"), and Bank of America
Illinois, as agent for the Banks.

BACKGROUND

1. On January 22, 1988, the Company, Continental Bank N.A. and the Agent
entered into a Credit Agreement (such Credit Agreement as amended by the First
Amendment dated as of May 22, 1989, and the Letter Agreement dated May 7, 1991,
being herein referred to as the "Original Credit Agreement"; unless otherwise
indicated, the other capitalized terms used herein shall have the meanings set
forth in Article I hereto) pursuant to which Continental Bank made the initial
Working Capital Loans and the initial Basic Loans (as defined in the Original
Credit Agreement).

2. During the period from January 22, 1988 through May 4, 1992, the
Banks, other than Continental Bank, were assigned interests in the Original
Credit Agreement and were made parties to that Agreement.

3. On May 4, 1992, the Company, the Banks and the Agent entered into an
Amended and Restated Credit Agreement (the "First Amended and Restated Credit
Agreement") to, among other things, (i) provide for the acquisition of certain
assets of Pulsafeeder, Inc. by certain wholly-owned Subsidiaries of the Company,
(ii) provide a new working capital facility from certain of the Banks and (iii)
modify certain of the covenants of the Original Credit Agreement, all on the
terms and conditions therein set forth.

4. On January 29, 1993, the Company, the Banks and the Agent entered into
the Second Amended and Restated Credit Agreement as amended by that certain
first, second, third, fourth and fifth amendments thereto dated May 23, 1994,
October 24, 1994, February 28, 1995, November 1, 1995 and December 22, 1995,
respectively (as amended, the "Existing Credit Agreement") to, among other
things, (i) to amend and extend the Commitments established by the First Amended
and Restated Credit Agreement, (ii) to modify certain covenants of the First
Amended and Restated Credit Agreement, and (iii) provide for various
acquisitions.

5. Currently, the Company desires that the Existing Credit Agreement be
amended and restated.

Accordingly, in consideration of the mutual agreements contained herein,
and subject to the terms and conditions hereof, the Existing Credit Agreement is
amended and restated in its entirety, and the parties hereto agree, as follows:

1
<PAGE> 9

ARTICLE I

DEFINITIONS

1.01 Certain Defined Terms. The following terms have the following meanings:

"Absolute Rate" has the meaning specified in subsection 2.07(c).

"Absolute Rate Auction" means a solicitation of Competitive Bids setting
forth Absolute Rates pursuant to Section 2.07.

"Absolute Rate Bid Loan" means a Bid Loan that bears interest at a rate
determined with reference to the Absolute Rate.

"Acquisition" means any transaction or series of related transactions for
the purpose of or resulting, directly or indirectly, in (a) the acquisition of
all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the capital
stock, partnership interests, membership interests or equity of any Person, or
otherwise causing any Person to become a Subsidiary, or (c) a merger or
consolidation or any other combination with another Person (other than a Person
that is a Subsidiary) provided that the Company or the Subsidiary is the
surviving entity.

"Affiliate" means, as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.

"Agent" means BofA in its capacity as agent for the Banks and the
Designated Bidders hereunder, and any successor agent arising under Section
10.09.

"Agent-Related Persons" means at any time, the Agent at such time,
together with its Affiliates (including, in the case of BofA, the Arranger),
and the officers, directors, employees, agents and attorneys-in-fact of such
Persons and Affiliates.

"Agent's Payment Office" means (i) in respect of payments in Dollars, the
address for payments set forth on Schedule 11.02 or such other address as the
Agent may from time to time specify in accordance with Section 11.02, and, (ii)
in the case of payments in any Offshore Currency, such address as the Agent may
from time to time specify in accordance with Section 11.02.

"Agreed Alternative Currency" has the meaning specified in subsection
2.05(e).

2
<PAGE> 10

"Agreement" means this Third Amended and Restated Credit Agreement as the
same may be amended, supplemented, amended and restated or otherwise modified
from time to time.

"Applicable Currency" means, as to any particular payment or Loan, Dollars
or the Offshore Currency in which it is denominated or is payable.

"Applicable Facility Fee Percentage" means, subject to the last sentence
of this definition, for any period, the applicable of the following percentages
in effect with respect to such period:

Applicable Facility
Funded Debt to EBITDA Ratio Fee Percentage
- --------------------------- -------------------
Level I, II and III Status .15%

Level IV Status .20%

Level V Status .25%

The Funded Debt to EBITDA Ratio shall be calculated by the Company as of the
end of each of its fiscal quarters commencing with the first fiscal quarter
ending after the date hereof and shall be reported to the Agent pursuant to the
Compliance Certificate delivered in accordance with subsection 7.02(b). The
Applicable Facility Fee Percentage shall be adjusted, if necessary, quarterly
on the first Business Day of the month following delivery of the Compliance
Certificate (the "Adjustment Date"), together with the required financial
statements for the applicable fiscal quarter; provided that, if such
certificate together with the financial statements are not delivered by the
required delivery date hereunder, then, unless such default is cured by the end
of the month such statements are due, the Applicable Facility Fee Percentage as
of the first Business Day of the month following the month in which such
statements were due shall be equal to .25% for the relevant period. Until
adjusted as described above, the Applicable Facility Fee Percentage shall be
equal to .15%, provided, further however, that from and after the effective
date of the Fluid Management Acquisition and until the next Adjustment Date as
provided above, the Applicable Facility Fee Percentage shall be equal to .20%.

"Applicable Margin" means, subject to the last sentence of this
definition, for any period, the applicable of the following percentages in
effect with respect to such period:

3
<PAGE> 11
Funded Debt to EBITDA Ratio Applicable Margin
- --------------------------- -----------------
Level I Status .250%

Level II Status .350%

Level III Status .500%

Level IV Status .625%

Level V Status .875%

The Funded Debt to EBITDA Ratio shall be calculated by the Company as of the
end of each of its fiscal quarters commencing with the first fiscal quarter
ending after the date hereof and shall be reported to the Agent pursuant to the
Compliance Certificate delivered in accordance with subsection 7.02(b). The
Applicable Margin shall be adjusted, if necessary, quarterly on the first
Business Day of the month following delivery of the Compliance Certificate (the
"Adjustment Date"), together with the required financial statements for the
applicable fiscal quarter; provided that, if such certificate together with the
financial statements are not delivered by the required delivery date hereunder,
then, unless such default is cured by the end of the month such statements are
due, the Applicable Margin as of the first Business Day of the month following
the month in which such statements were due shall be equal to .875% for the
relevant period. Until adjusted as described above, the Applicable Margin
shall be equal to .350% provided, further however, that from and after the
effective date of the Fluid Management Acquisition and until the next
Adjustment Date as provided above, the Applicable Margin shall be equal to
.625%.

"Arranger" means BA Securities, Inc., a Delaware corporation.

"Assignee" has the meaning specified in subsection 11.08(a).

"Attorney Costs" means and includes all reasonable out-of-pocket fees and
disbursements of any law firm or other external counsel, the allocated cost of
internal legal services and all disbursements of internal counsel.

"Bank" has the meaning specified in the introductory clause hereto.

"Banking Day" means any day other than a Saturday, Sunday or other day on
which commercial banks in Chicago are authorized or required by law to close
and (i) with respect to disbursements and payments in Dollars with respect to
any Loan bearing interest based upon a LIBO Rate or the Offshore Rate, a day on
which dealings are carried on in the applicable offshore Dollar interbank
market, and (ii) with respect to any disbursements and payments in and
calculations pertaining to any Offshore Currency Loan, a day on which
commercial banks are open for foreign exchange business in London, England, and
on which

4
<PAGE> 12

dealings in the relevant Offshore Currency are carried on in the applicable
offshore foreign exchange interbank market in which disbursement of or payment
in such Offshore Currency will be made or received hereunder.

"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. Section 101, et seq.).

"Base Rate" means, for any day, the higher of: (a) 0.50% per annum above
the latest Federal Funds Rate; and (b) the rate of interest in effect for such
day as publicly announced from time to time by BofA in Chicago, Illinois, as
its "reference rate." (The "reference rate" is a rate set by BofA based upon
various factors including BofA's costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate.) Any
change in the reference rate announced by BofA shall take effect at the opening
of business on the day specified in the public announcement of such change.

"Base Rate Committed Loan" means a Committed Loan that bears interest
based on the Base Rate.

"Bid Borrowing" means a Borrowing hereunder consisting of one or more Bid
Loans made to the Company on the same day by one or more Banks or Designated
Bidders.

"Bid Loan" means a Loan by a Bank or a Designated Bidder to the Company
under Section 2.06, which may be a LIBOR Bid Loan or an Absolute Rate Bid Loan.

"Bid Loan Lender" means, in respect of any Bid Loan, the Bank or
Designated Bidder making such Bid Loan to the Company.

"Bid Loan Notes" has the meaning specified in Section 2.02.

"BofA" means Bank of America Illinois, a banking association organized
under the laws of the State of Illinois.

"Borrowing" means a borrowing hereunder consisting of Loans of the same
Type and in the same Applicable Currency made to the Company on the same day by
the Banks or (in the case of Bid Borrowings) Designated Bidders under Article
II, and may be a Committed Borrowing or a Bid Borrowing and, other than in the
case of Base Rate Committed Loans, having the same Interest Period.

"Borrowing Date" means any date on which a Borrowing occurs under Section
2.03.

"Business Day" means any day other than a Saturday, Sunday or other day on
which commercial banks in Chicago are authorized or required by law to close
and, if the applicable Business Day relates to any Offshore Rate Loan, means a
Banking Day.

5
<PAGE> 13

"Capital Adequacy Regulation" means any guideline, request or directive of
any central bank or other Governmental Authority, or any other law, rule or
regulation, whether or not having the force of law, in each case, regarding
capital adequacy of any bank or of any corporation controlling a bank.

"Capital Expenditures" means, for any period and with respect to any
Person, the aggregate of the principal component of all expenditures by such
Person and its Subsidiaries for the acquisition or leasing of fixed or capital
assets or additions to equipment (including replacements, capitalized repairs
and improvements during such period) which should be capitalized under GAAP on
a consolidated balance sheet of such Person and its Subsidiaries, less net
proceeds from sales of fixed or capital assets received by such Person or any
of its Subsidiaries during such period. For the purpose of this definition,
the purchase price of equipment which is purchased simultaneously with the
trade-in of existing equipment owned by such Person or any of its Subsidiaries
or with insurance proceeds shall be included in Capital Expenditures only to
the extent of the gross amount of such purchase price less the credit granted
by the seller of such equipment for such equipment being traded in at such
time, or the amount of such proceeds, as the case may be.

"Capital Lease" has the meaning specified in the definition of "Capital
Lease Obligations."

"Capital Lease Obligations" means the principal component of all monetary
obligations of the Company or any of its Subsidiaries under any leasing or
similar arrangement which, in accordance with GAAP, is classified as a capital
lease ("Capital Lease").

"Cash Collateralize" means to pledge and deposit with or deliver to the
Agent, for the benefit of the Agent, the Issuing Bank and the Banks, as
collateral for the L/C Obligations, cash or deposit account balances pursuant
to documentation in form and substance reasonably satisfactory to the Agent and
the Issuing Bank (which documents are hereby consented to by the Banks).
Derivatives of such term shall have corresponding meanings. The Company hereby
grants the Agent, for the benefit of the Agent, the Issuing Bank and the Banks,
a security interest in all such cash and deposit account balances. Cash
collateral shall be maintained in blocked, non-interest bearing deposit
accounts at BofA.

"Change of Control" means any of the following: (i) any person or group of
persons (within the meaning of the Exchange Act) shall have acquired beneficial
ownership (within the meaning of Rule 13d-3 promulgated by the SEC under the
Exchange Act) of 30% or more of the issued and outstanding shares of the
Company's capital stock having the right to vote for the election of directors
of the Company under ordinary circumstances; or (ii) during any period of twelve
consecutive calendar months, individuals who at the beginning of such period
constituted the Company's board of directors (together with any new directors
whose election by the Company's board of directors or whose nomination for
election by the Company's stockholders was approved by a vote of a majority of
the directors then still in

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<PAGE> 14

office who either were directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason other than death or disability to constitute a majority of the directors
then in office.

"Closing Date" means the date on which all conditions precedent set forth
in Section 5.01 are satisfied or waived by all Banks (or, in the case of
subsection 5.01(e), waived by the Person entitled to receive such payment).

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

"Commitment", as to each Bank, has the meaning specified in Section 2.01.

"Committed Borrowing" means a Borrowing hereunder consisting of Committed
Loans made on the same day by the Banks ratably according to their respective
Pro Rata Shares and, in the case of Offshore Rate Committed Loans, having the
same Interest Periods.

"Committed Loan" means a Loan by a Bank to the Company under Section 2.01,
and may be an Offshore Rate Committed Loan or a Base Rate Committed Loan (each,
a "Type" of Committed Loan).

"Committed Loan Notes" has the meaning specified in Section 2.02.

"Competitive Bid" means an offer by a Bank or a Designated Bidder to make
a Bid Loan in accordance with subsection 2.07(b).

"Competitive Bid Request" has the meaning specified in subsection 2.07(a).

"Compliance Certificate" means a certificate substantially in the form of
Exhibit 7.02(b).

"Computation Date" has the meaning specified in subsection 2.05(a).

"Consolidated Fixed Charges" means, for any period, for the Company and its
Subsidiaries, the sum of (without duplication) (i) Consolidated Interest
Expense, (ii) all scheduled payments of principal on Indebtedness of the Company
and its Subsidiaries (including, without limitation, principal payments in
respect of Capital Leases and in the case of this Agreement, scheduled
reductions in the combined Commitment, but only to the extent that (a) the
average daily borrowed portion of the combined Commitment during such period
exceeds (b) the amount of the combined Commitment on the date of determination),
(iii) taxes paid in cash, (iv) Consolidated Rental Expense, and (v) cash
dividends paid by the Company, as each of the foregoing is made or incurred
during such period of determination in accordance with GAAP on a consolidated
basis.

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<PAGE> 15

"Consolidated Interest Expense" means, for any period, the sum of total
interest expense (including that attributable to Capitalized Leases in
accordance with GAAP) of the Company and its Subsidiaries on a consolidated
basis with respect to all outstanding Indebtedness of the Company and its
Subsidiaries, including, without limitation, all commissions, discounts and
other fees and charges owed with respect to letters of credit and bankers'
acceptance financing, but excluding, however, any amortization of deferred
financing costs, all as determined on a consolidated basis for the Company and
its consolidated Subsidiaries in accordance with GAAP. Any calculation of pro
forma Consolidated Interest Expense with respect to an Acquisition shall be
done on the basis that (A) any Indebtedness incurred or assumed in connection
with such Acquisition was incurred or assumed at the beginning of the pro forma
period, (B) such Indebtedness was repaid from operating cash flow over the pro
forma period at the intervals and in the amounts reasonably projected to be
paid in respect of such Indebtedness over the 12-month period immediately
following the Acquisition and (C) if such Indebtedness bears a floating
interest rate, such interest shall be paid over the pro forma period at the
rate in effect on the date of such Acquisition.

"Consolidated Net Income" and "Consolidated Net Loss" mean, respectively,
with respect to any period for any Person, the aggregate of the net income
(loss) of such Person for such period, determined in accordance with GAAP on a
consolidated basis, provided that (i) the net income (loss) of any other Person
which is not a Subsidiary shall be included in the Consolidated Net Income of
such Person only to the extent of the amount of cash dividends or distributions
paid to such Person or to a consolidated Subsidiary of such Person and (ii) the
net income (loss) of any Person acquired in a pooling of interests transaction
for any period prior to the date of such acquisition shall be excluded from the
Consolidated Net Income of such Person. There shall be excluded in computing
Consolidated Net Income the excess (but not the deficit), if any, of (i) any
gain which must be treated as an extraordinary item under GAAP or any gain
realized upon the sale or other disposition of any real property or equipment
that is not sold in the ordinary course of business or of any capital stock of a
Subsidiary of such Person over (ii) any loss which must be treated as an
extraordinary item under GAAP or any loss realized upon the sale or other
disposition of any real property or equipment that is not sold in the ordinary
course of business or of any capital stock of the a Subsidiary of such Person,
provided that any extraordinary loss incurred in connection with the repurchase
or refinance of Subordinated Debt outstanding as of the date hereof shall be
excluded in computing Consolidated Net Income.

"Consolidated Rental Expense" means, for any period, the sum of the
aggregate payments of the Company and its Subsidiaries on a consolidated basis
under agreements to rent or lease any real or personal property (exclusive of
Capital Lease Obligations), all as determined on a consolidated basis for the
Company and its consolidated Subsidiaries in accordance with GAAP.

"Contingent Obligation" means, as to any Person, any direct or indirect
liability of that Person, whether or not contingent, with or without recourse,
(a) with respect to any

8
<PAGE> 16

Indebtedness, lease, dividend, letter of credit or other obligation (the
"primary obligations") of another Person (the "primary obligor"), including any
obligation of that Person (i) to purchase, repurchase or otherwise acquire such
primary obligations or any security therefor, (ii) to advance or provide funds
for the payment or discharge of any such primary obligation, or to maintain
working capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency or any balance sheet item, level of income or
financial condition of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation, or (iv) otherwise to assure or hold harmless the holder
of any such primary obligation against loss in respect thereof (each, a
"Guaranty Obligation"); (b) with respect to any Surety Instrument issued for the
account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings or payments; (c) to purchase any materials, supplies
or other property from, or to obtain the services of, another Person if the
relevant contract or other related document or obligation requires that payment
for such materials, supplies or other property, or for such services, shall be
made regardless of whether delivery of such materials, supplies or other
property is ever made or tendered, or such services are ever performed or
tendered, or (d) in respect of any Swap Contract. The amount of any Contingent
Obligation shall, in the case of Guaranty Obligations, be deemed equal to the
stated or determinable amount of the primary obligation in respect of which such
Guaranty Obligation is made or, if not stated or if indeterminable, the maximum
reasonably anticipated liability in respect thereof provided, that if any
Guaranty Obligation (i) is limited to an amount less than the obligations
guaranteed or supported the amount of the corresponding Contingent Obligation
shall be equal to the lesser of the amount determined pursuant to the initial
clause of this sentence and the amount to which such guaranty is so limited or
(ii) is limited to recourse against a particular asset or assets of such Person
the amount of the corresponding Contingent Obligation shall be equal to the
lesser of the amount determined pursuant to the initial clause of this sentence
and the fair market value of such asset or assets at the date for determination
of the amount of the Contingent Obligation. In the case of other Contingent
Obligations other than in respect of Swap Contracts, shall be equal to the
maximum reasonably anticipated liability in respect thereof and, in the case of
Contingent Obligations in respect of Swap Contracts, shall be equal to the Swap
Termination Value.

"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, undertaking, contract,
indenture, mortgage, deed of trust or other instrument, document or agreement
to which such Person is a party or by which it or any of its property is bound.

"Conversion/Continuation Date" means any date on which, under Section
2.04, the Company (a) converts Committed Loans of one Type to another Type, or
(b) continues as Committed Loans of the same Type, but with a new Interest
Period, Committed Loans having Interest Periods expiring on such date.

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<PAGE> 17

"Credit Extension" means and includes (a) the making of any Loans
hereunder and (b) the Issuance of any Letters of Credit hereunder.

"Default" means any event or circumstance which, with the giving of notice
pursuant to this Agreement, the lapse of any cure period specified herein, or
both, would (if not cured or otherwise remedied during such time) constitute an
Event of Default.

"Designated Bidder" means an Affiliate of a Bank that is an entity
described in clause (i) or (ii) of the definition of "Eligible Assignee" and
that has become a party hereto pursuant to subsection 11.09.

"Designation Agreement" means a designation agreement entered into by a
Bank and a Designated Bidder and accepted by the Agent, in substantially the
form of Exhibit 11.09.

"Disposition" has the meaning specified in subsection 8.02.
"Dollar Equivalent" means, at any time, (a) as to any amount denominated
in Dollars, the amount thereof at such time, (b) as to any amount denominated
in an Offshore Currency, the equivalent amount in Dollars as determined by the
Agent at such time on the basis of the Spot Rate for the purchase of Dollars
with such Offshore Currency on the most recent Computation Date provided for in
subsection 2.05(a) and (c) as to any amount denominated in an Offshore L/C
Currency, the equivalent amount in Dollars as determined by the Issuing Bank at
such time on the basis of the Spot Rate for the purchase of Dollars with such
Offshore L/C Currency..

"Dollars", "dollars" and "$" each mean lawful money of the United States.

"Domestic Subsidiary" means any Subsidiary of the Company that is not a
Foreign Subsidiary.

"EBIT" means, for any period, for the Company and its Subsidiaries on a
consolidated basis, determined in accordance with GAAP, the sum of (a)
Consolidated Net Income for such period plus (b) all amounts treated as
expenses for interest to the extent included in the determination of such
Consolidated Net Income plus (c) all accrued taxes on or measured by income to
the extent included in the determination of such Consolidated Net Income.

"EBITDA" means, for any period, for the Company and its Subsidiaries on a
consolidated basis, determined in accordance with GAAP, the sum of (a) EBIT
plus (b) all amounts treated as expenses for depreciation or the amortization
of intangibles of any kind to the extent included in the determination of
Consolidated Net Income, provided that in the event of the occurrence of any
Acquisition or Disposition during the period, EBITDA shall be calculated on a
pro forma basis as if such Acquisition or Disposition occurred on the first day
of the relevant period such that, in the case of an Acquisition, all income and
expense

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<PAGE> 18

associated with the assets or entity acquired in connection with such
acquisition for the most recently ended four fiscal quarter period for which
such income and expense amounts are available shall be treated as earned or
incurred by the Company over the applicable period and, in the case of a
Disposition, all income and expense associated with the assets or entity sold
or transferred during such period shall be eliminated over the applicable
period.

"Effective Amount" means (a) with respect to any Loans on any date, the
aggregate outstanding principal Dollar Equivalent amount thereof after giving
effect to any Borrowings and prepayments or repayments of Loans occurring on
such date; and (b) with respect to any outstanding L/C Obligations on any date,
the Dollar Equivalent amount of such L/C Obligations on such date after giving
effect to any Issuances of Letters of Credit occurring on such date and any
other changes in the aggregate amount of the L/C Obligations as of such date,
including as a result of any reimbursements of outstanding unpaid drawings under
any Letters of Credit or any reductions in the maximum amount available for
drawing under Letters of Credit taking effect on such date.

"Eligible Assignee" means (a) a commercial bank organized under the laws
of the United States, or any state thereof, and having a combined capital and
surplus of at least $200,000,000; (b) a commercial bank organized under the
laws of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any
such country, and having a combined capital and surplus of at least
$200,000,000, provided that such bank is acting through a branch or agency
located in the country in which it is organized or another country which is
also a member of the OECD; and (c) a Person that is primarily engaged in the
business of commercial banking and that is (i) a Subsidiary of a Bank, (ii) a
Subsidiary of a Person of which a Bank is a Subsidiary, or (iii) a Person of
which a Bank is a Subsidiary.

"Environmental Claims" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law, or for release or injury
to the environment.

"Environmental Laws" means all federal, state or local laws, statutes,
common law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, requests, licenses, authorizations and
permits of, and agreements with, any Governmental Authorities, in each case
relating to environmental, health, safety and land use matters.

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

"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Company within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).

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<PAGE> 19

"ERISA Event" means (a) a Reportable Event with respect to a Pension Plan;
(b) a withdrawal by the Company or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations which is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Company or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Section 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which might reasonably be
expected to constitute grounds under Section 4042 of ERISA for the termination
of, or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (f) the imposition of any liability under Title IV of
ERISA, other than PBGC premiums due but not delinquent under Section 4007 of
ERISA, upon the Company or any ERISA Affiliate.

"Eurodollar Reserve Percentage" has the meaning specified in the
definition of "Offshore Rate".

"Event of Default" means any of the events or circumstances specified in
Section 9.01.

"Exchange Act" means the Securities Exchange Act of 1934, and regulations
promulgated thereunder, in each case, as amended from time to time

"FDIC" means the Federal Deposit Insurance Corporation, and any
Governmental Authority succeeding to any of its principal functions.

"Federal Funds Rate" means, for any day, the rate set forth in the weekly
statistical release designated as H.15(519), or any successor publication,
published by the Federal Reserve Bank of New York (including any such
successor, "H.15(519)") on the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such day will be the
arithmetic mean as determined by the Agent of the rates for the last
transaction in overnight Federal funds arranged prior to 9:00 a.m. (New York
City time) on that day by each of three leading brokers of Federal funds
transactions in New York City selected by the Agent.

"Fee Letter" has the meaning specified in subsection 2.13(a).

"Fluid Management Acquisition" means the Acquisition by the Company of the
Fluid Management Division of Saranow Co. for a purchase price of approximately
$135,000,000.

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<PAGE> 20

"Foreign Subsidiary" any Subsidiary of the Company that (A) is
incorporated under the laws of a jurisdiction other than any State of the U.S.,
the District of Columbia or any territory, commonwealth or possession of the
U.S. and (B) maintains the major portion of its assets outside the U.S.

"FRB" means the Board of Governors of the Federal Reserve System, and any
Governmental Authority succeeding to any of its principal functions.

"Funded Debt" shall at any date mean:

(a) all outstanding principal under this Agreement;

(b) any Indebtedness outstanding and permitted under Section 8.05(h); and

(c) all other Indebtedness (excluding any Indebtedness included solely
within clause (b) of the definition of Indebtedness) of the Company or any of
its Subsidiaries which by its terms

(i) matures more than one year from the date of its creation, or

(ii) matures within one year from the date of its creation but, at
the Company's or such Subsidiary's election, is renewable or extendible
(whether or not theretofore renewed or extended) under, or payable from the
proceeds of any other Indebtedness which may be incurred pursuant to the
provisions of, any revolving credit or similar agreement.

"Funded Debt to EBITDA Ratio" means, for any period of four consecutive
fiscal quarters (the "Four Quarter Period") the ratio of Funded Debt as of the
last day of such four fiscal quarter period to EBITDA for such Four Quarter
Period.

"FX Trading Office" means the Foreign Exchange Trading Center #5193, San
Francisco, California, of BofA, or such other of BofA's offices as BofA may
designate from time to time.

"Further Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar charges
(including, without limitation, net income taxes and franchise taxes), and all
liabilities with respect thereto, imposed by any jurisdiction on account of
amounts payable or paid pursuant to Section 4.01.

"GAAP" means generally accepted accounting principles set forth from time
to time in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable stature and authority within the U.S.
accounting profession), which are applicable to the

13
<PAGE> 21

circumstances as of (a) in the case of computation pursuant to Section 8.15, the
date of this Agreement and (b) in all other cases, the applicable date.

"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof or any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to
government.

"Guaranty Obligation" has the meaning specified in the definition of
"Contingent Obligation."

"Honor Date" has the meaning specified in subsection 3.03(b).

"Indebtedness" of any Person means, without duplication, (a) all
indebtedness for borrowed money; (b) all obligations issued, undertaken or
assumed as the deferred purchase price of property or services (other than
trade payables entered into in the ordinary course of business on ordinary
terms); (c) all non-contingent reimbursement or payment obligations with
respect to Surety Instruments; (d) all obligations evidenced by notes, bonds,
debentures or similar instruments, including obligations so evidenced incurred
in connection with the acquisition of property, assets or businesses; (e) all
indebtedness created or arising under any conditional sale or other title
retention agreement, or incurred as financing, in either case with respect to
property acquired by the Person (even though the rights and remedies of the
seller or bank under such agreement in the event of default are limited to
repossession or sale of such property); (f) all Capital Lease Obligations; (g)
all indebtedness referred to in clauses (a) through (f) above secured by (or
for which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including accounts
and contracts rights) owned by such Person, even though such Person has not
assumed or become liable for the payment of such Indebtedness; and (h) all
Guaranty Obligations in respect of indebtedness or obligations of others of the
kinds referred to in clauses (a) through (g) above. In the event any of the
foregoing Indebtedness is limited to recourse against a particular asset or
assets of such Person, the amount of the corresponding Indebtedness shall be
equal to the lesser of the amount of such Indebtedness and the fair market
value of such asset or assets at the date for determination of the amount of
such Indebtedness. In addition, the amount of any Indebtedness which is also a
Contingent Obligation shall be determined as provided in the definition of
"Contingent Obligation."

Provided, Indebtedness shall not include sales of Permitted Foreign Receivables
sold pursuant to Permitted Foreign Receivables Purchase Facilities and
indemnification, recourse or repurchase obligations thereunder. For all
purposes of this Agreement, the Indebtedness of any Person shall include all
Indebtedness of any partnership or joint venture or limited liability company in
which such Person is a general partner or a joint venturer or a member, but in
any such case, only to the extent any such Indebtedness is recourse to such
Person.

"Indemnified Liabilities" has the meaning specified in Section 11.05.

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<PAGE> 22
"Indemnified Person" has the meaning specified in Section 11.05.

"Independent Auditor" has the meaning specified in subsection 7.01(a).

"Insolvency Proceeding" means, with respect to any Person, (a) any case,
action or proceeding with respect to such Person before any court or other
Governmental Authority relating to bankruptcy, reorganization, insolvency,
liquidation, receivership, dissolution, winding-up or relief of debtors, or (b)
any general assignment for the benefit of creditors, composition, marshalling
of assets for creditors, or other, similar arrangement in respect of its
creditors generally or any substantial portion of its creditors; undertaken
under U.S. Federal, state or foreign law, including the Bankruptcy Code.

"Intercompany Indebtedness" means, Indebtedness of the Company or any of
its Subsidiaries which, in the case of the Company, is owing to any Subsidiary
of the Company and which, in the case of any Subsidiary, is owing to the
Company or any of the Company's other Subsidiaries.

"Intercompany Note" means a promissory note from a Subsidiary of the
Company to the Company in a form satisfactory to Agent and required to be
pledged pursuant to the Pledge Agreement.

"Interest Payment Date" means, as to any Loan other than a Base Rate
Committed Loan, the last day of each Interest Period applicable to such Loan
and, as to any Base Rate Committed Loan, the last Business Day of each calendar
quarter and each date such Committed Loan is converted into another Type of
Loan, provided, however, that (a) if any Interest Period for an Offshore Rate
Loan exceeds three months, the date that falls three months after the beginning
of such Interest Period and after each Interest Payment Date thereafter is also
an Interest Payment Date, and (b) as to any Absolute Rate Bid Loan, such
intervening dates prior to the maturity thereof as may be specified by the
Company and agreed to by the applicable Bid Loan Lender in the applicable
Competitive Bid shall also be Interest Payment Dates.

"Interest Period" means, (a) as to any Offshore Rate Loan, the period
commencing on the Borrowing Date of such Loan or (in the case of any Offshore
Rate Committed Loan) on the Conversion/Continuation Date on which the Loan is
converted into or continued as an Offshore Rate Committed Loan, and ending on
the date one, two, three, six or, if available to each Bank, twelve months
thereafter (and in the case of any Offshore Rate Committed Loan, any other
period that is 12 months or less and is consented to by the Majority Banks in
the given instance) as selected by the Company in its Notice of Borrowing or
Notice of Conversion/Continuation or Competitive Bid Request, as the case may
be; and (b) as to any Absolute Rate Bid Loan, a period of not less than 14 days
and not more than 365 days as selected by the Company in the applicable
Competitive Bid Request;

provided that:

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<PAGE> 23

(i) if any Interest Period would otherwise end on a day that is not a
Business Day, that Interest Period shall be extended to the following
Business Day unless, in the case of an Offshore Rate Loan, the result of
such extension would be to carry such Interest Period into another calendar
month, in which event such Interest Period shall end on the preceding
Business Day;

(ii) any Interest Period pertaining to an Offshore Rate Loan that
begins on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period shall end on the last
Business Day of the calendar month at the end of such Interest Period; and

(iii) no Interest Period for any Loan shall extend beyond the
Revolving Termination Date;

"Invitation for Competitive Bids" means a solicitation for Competitive
Bids, substantially in the form of Exhibit 2.07(b).

"IRS" means the Internal Revenue Service, and any Governmental Authority
succeeding to any of its principal functions under the Code.

"Issuance Date" has the meaning specified in subsection 3.01(a).

"Issue" means, with respect to any Letter of Credit, to issue or to extend
the expiry of, or to renew or increase the amount of, such Letter of Credit;
and the terms "Issued," "Issuing" and "Issuance" have corresponding meanings.

"Issuing Bank" means, with respect to any Letter of Credit, BofA or any
Bank which at the request of the Company (and with the consent of the Agent,
which will not be unreasonably withheld) agrees, in such Bank's sole discretion,
to become an Issuing Bank for purposes of Issuing Letters of Credit pursuant to
Article III.

"Joint Venture" means a single-purpose corporation, partnership, limited
liability company, joint venture or other similar legal arrangement (whether
created by contract or conducted through a separate legal entity) now or
hereafter formed by the Company or any of its Subsidiaries with another Person
in order to conduct a common venture or enterprise with such Person.

"KKR" shall mean Kohlberg Kravis Roberts & Co., a Delaware limited
partnership.

"L/C Advance" means each Bank's participation in any L/C Borrowing in
accordance with its Pro Rata Share.

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<PAGE> 24

"L/C Amendment Application" means an application form for amendment of
outstanding standby or commercial documentary letters of credit as shall at any
time be in use at the Issuing Bank, as the Issuing Bank shall request.

"L/C Application" means an application form for issuances of standby or
commercial documentary letters of credit as shall at any time be in use at the
Issuing Bank, as the Issuing Bank shall request.

"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which shall not have been reimbursed on the date
when made nor converted into a Borrowing of Loans under subsection 3.03(b).

"L/C Commitment" means the commitment of the Issuing Bank to Issue, and
the commitment of the Banks severally to participate in, Letters of Credit from
time to time Issued or outstanding under Article III; provided that the L/C
Commitment is a part of the combined Commitments, rather than a separate,
independent commitment.

"L/C Obligations" means at any time the sum of (a) the aggregate undrawn
amount of all Letters of Credit then outstanding, plus (b) the amount of all
unreimbursed drawings under all Letters of Credit, including all outstanding
L/C Borrowings.

"L/C-Related Documents" means the Letters of Credit, the L/C Applications,
the L/C Amendment Applications and any other document relating to any Letter of
Credit, including any of the Issuing Bank's standard form documents for letter
of credit issuances.

"Lending Office" means, as to any Bank, the office or offices of such Bank
specified as its "Lending Office" or "Domestic Lending Office" or "Offshore
Lending Office", as the case may be, on Schedule 11.02, or such other office or
offices as such Bank may from time to time notify the Company and the Agent.

"Letters of Credit" means any letters of credit (whether standby letters
of credit or commercial documentary letters of credit) Issued by the Issuing
Bank pursuant to Article III.

"Level I Status" exists at any date if at such date the Funded Debt to
EBITDA Ratio is less than 1.75:1.00.

"Level II Status" exists at any date if at such date the Funded Debt to
EBITDA Ratio is less than 2.00:1.00 but greater than or equal to 1.75:1.00.

"Level III Status" exists at any date if at such date the Funded Debt to
EBITDA Ratio is less than 2.50:1.00 but greater than or equal to 2.00:1.00.

"Level IV Status" exists at any date if at such date the Funded Debt to
EBITDA Ratio is less than or equal to 3.00:1.00 but greater than or equal to
2.50:1.00.

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<PAGE> 25

"Level V Status" exists at any date if at such date the Funded Debt to
EBITDA Ratio is greater than 3.00:1.00.

"LIBO Rate" means, for any Interest Period with respect to a LIBOR Bid
Loan the rate of interest per annum determined by the Agent to be (rounded
upward to the nearest 1/16th of 1%) the rate of interest at which dollar
deposits in the approximate amount of the LIBOR Bid Loans to be borrowed in
such Bid Loan Borrowing, and having a maturity comparable to such Interest
Period, would be offered to major banks in the London interbank market at their
request at approximately 11:00 a.m. (London time) two Business Days prior to
the commencement of such Interest Period.

"LIBOR Auction" means a solicitation of Competitive Bids setting forth a
LIBOR Bid Margin pursuant to Section 2.07.

"LIBOR Bid Loan" means any Bid Loan that bears interest at a rate based
upon the LIBO Rate.

"LIBOR Bid Margin" has the meaning specified in subsection 2.07(c)(ii)(C).

"Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other), any conditional sale or other title retention agreement,
the interest of a lessor under a capital lease, any financing lease having
substantially the same economic effect as any of the foregoing, or the filing of
any financing statement naming the owner of the asset to which such lien relates
as debtor, under the Uniform Commercial Code or any comparable law) and any
contingent or other agreement to provide any of the foregoing, but, in any such
case, not including the interest of a lessor under an operating lease or the
interest of a purchaser of Permitted Foreign Receivables under any Permitted
Foreign Receivables Purchase Facility.

"Loan" means an extension of credit by a Bank or a Designated Bidder to
the Company under Article II, and may be a Committed Loan or a Bid Loan.

"Loan Documents" means this Agreement, any Notes, the Fee Letters, the
Subsidiary Guaranty Agreement (together with any addendums thereto), the Pledge
Agreement, the L/C Related Documents and all other documents delivered to the
Agent or any Bank or Designated Bidder in connection herewith or therewith.

"Majority Banks" means at any time Banks then holding in excess of 50% of
the then aggregate unpaid principal amount of the Committed Loans plus the L/C
Obligations, or, if no such principal amount is then outstanding, Banks then
having in excess of 50% of the Commitments.

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<PAGE> 26

"Margin Stock" means "margin stock" as such term is defined in Regulation
G, T, U or X of the FRB.

"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, or
financial condition of the Company and its Subsidiaries taken as a whole; (b) a
material impairment of the ability of the Company and its Subsidiaries to
perform under any material Loan Document; or (c) a material adverse effect upon
the legality, validity, binding effect or enforceability against the Company or
any Subsidiary of any Loan Document.

"Material Subsidiary" means, at any time, any Subsidiary having at such
time total assets, as of the last day of the preceding fiscal quarter, having a
net book value in excess 5% of the consolidated total assets of the Company,
based upon the Company's most recent annual or quarterly financial statements
delivered to the Agent under Section 7.01.

"Minimum Tranche" means, in respect of Loans comprising part of the same
Borrowing, or to be converted or continued under Section 2.04, (a) in the case
of Base Rate Loans, $1,000,000 or any multiple of $500,000 in excess thereof,
and (b) in the case of Offshore Rate Loans, the Dollar Equivalent amount of
$3,000,000 or any multiple of 1,000,000 units of the Applicable Currency in
excess thereof.

"Multiemployer Plan" means a "multiemployer plan", within the meaning of
Section 4001(a)(3) of ERISA, to which the Company or any ERISA Affiliate makes,
is making, or is obligated to make contributions or, during the preceding three
calendar years, has made, or been obligated to make, contributions.

"Notes" means the Committed Loan Notes and the Bid Loan Notes.

"Notice of Borrowing" means a notice in substantially the form of Exhibit
2.03(a).

"Notice of Conversion/Continuation" means a notice in substantially the
form of Exhibit 2.04.

"Obligations" means all advances, debts, liabilities, obligations,
covenants and duties arising under any Loan Document owing by the Company to
any Bank, Designated Bidder, the Agent, or any Indemnified Person, whether
direct or indirect (including those acquired by assignment pursuant to Section
11.08(a) hereof), absolute or contingent, due or to become due, now existing or
hereafter arising.

"Offshore Currency" means at any time Dutch gilders, British pounds
sterling, Canadian dollars, French francs, Deutsche Mark, Japanese yen and any
Agreed Alternative Currency.

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<PAGE> 27

"Offshore Currency Loan" means any Offshore Rate Loan denominated in an
Offshore Currency.

"Offshore Currency Loan Sublimit" means, as to all Offshore Currencies in
the aggregate, $125,000,000.

"Offshore L/C Currency" means, at any time, any Offshore Currency and,
with respect to any Letter of Credit, any other currency agreed to by the
Issuing Bank thereof.

"Offshore Rate" means, for any Interest Period, with respect to Offshore
Rate Committed Loans comprising part of the same Borrowing, the rate of
interest per annum (rounded upward to the next 1/16th of 1%) determined by the
Agent as follows:

Offshore Rate = IBOR
-----------------------------
1.00 - Eurodollar Reserve Percentage

Where,

"Eurodollar Reserve Percentage" means for any day for any Interest
Period the maximum reserve percentage (expressed as a decimal, rounded
upward to the next 1/100th of 1%) in effect on such day (whether or not
applicable to any Bank) under regulations issued from time to time by the
FRB for determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement) with respect
to Eurocurrency funding (currently referred to as "Eurocurrency
liabilities"); and

"IBOR" means the rate of interest per annum determined by the Agent as
the rate at which deposits in the Applicable Currency, in the approximate
amount of BofA's Offshore Rate Loan for such Interest Period would be
offered by BofA's Grand Cayman Branch, Grand Cayman B.W.I. (or such other
office as may be designated for such purpose by BofA), to major banks in
the offshore currency interbank market at their request at approximately
11:00 a.m. (New York City time) two Business Days prior to the commencement
of such Interest Period.

The Offshore Rate shall be adjusted automatically as to all Offshore
Rate Loans then outstanding as of the effective date of any change in the
Eurodollar Reserve Percentage.

"Offshore Rate Committed Loan" means a Committed Loan that bears interest
based on the Offshore Rate.

"Offshore Rate Loan" means any LIBOR Bid Loan or any Offshore Rate
Committed Loan.

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<PAGE> 28

"Organization Documents" means, for any corporation, the certificate or
articles of incorporation, the bylaws, any certificate of determination or
instrument relating to the rights of preferred shareholders of such
corporation, any shareholder rights agreement, and all applicable resolutions
of the board of directors (or any committee thereof) of such corporation.

"Other Taxes" means any present or future stamp, court or documentary
taxes or any other excise or property taxes, charges or similar levies which
arise from any payment made hereunder or from the execution, delivery,
performance, enforcement or registration of, or otherwise with respect to, this
Agreement or any other Loan Documents.

"Overnight Rate" means, for any day, the rate of interest per annum at
which overnight deposits in the Applicable Currency, in an amount approximately
equal to the amount with respect to which such rate is being determined, would
be offered for such day by BofA's London Branch to major banks in the London or
other applicable offshore interbank market.

"Participant" has the meaning specified in subsection 11.08(d).

"PBGC" means the Pension Benefit Guaranty Corporation, or any Governmental
Authority succeeding to any of its principal functions under ERISA.

"Pension Plan" means a pension plan (as defined in Section 3(2) of ERISA)
subject to Title IV of ERISA which the Company sponsors, maintains, or to which
it makes, is making, or is obligated to make contributions, or in the case of a
multiple employer plan (as described in Section 4064(a) of ERISA) has made
contributions at any time during the immediately preceding five (5) plan years,
but excluding any Multiemployer Plans.

"Permitted Liens" has the meaning specified in Section 8.01.

"Permitted Foreign Receivables" shall mean all obligations of any obligor
whose principal place of business is not in the United States (whether now
existing or hereafter arising) under a contract for sale of goods or services
by the Company or any of its Subsidiaries, which shall include any obligation
of such obligor (whether now existing or hereafter arising) to pay interest,
finance charges or amounts with respect thereto, and, with respect to any of
the foregoing receivables or obligations, (a) all of the interest of the
Company or any of its Subsidiaries in the goods (including returned goods) the
sale of which gave rise to such receivable or obligation after the passage of
title thereto to any obligor, (b) all other Liens and property subject thereto
from time to time purporting to secure payment of such receivables or
obligations, (c) all guarantees, insurance, letters of credit and other
agreements or arrangements of whatever character from time to time supporting
or securing payment of any such receivables or obligations and (d) all records
relating to any of the foregoing and all proceeds and products of any of the
foregoing.

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<PAGE> 29

"Permitted Foreign Receivables Purchase Facility" shall mean any agreement
of the Company or any of its Subsidiaries providing for sales, transfers or
conveyances of Permitted Foreign Receivables purporting to be sales (and
considered sales under GAAP) that do not provide, directly or indirectly, for
recourse against the seller of such Permitted Foreign Receivables (or against
any of such seller's Affiliates) by way of a guaranty or any other support
arrangement, with respect to the amount of such Permitted Foreign Receivables
(based on the financial condition or circumstances of the obligor thereunder),
other than such limited recourse as is reasonable given market standards for
transactions of a similar type, taking into account such factors as historical
bad debt loss experience and obligor concentration levels.

"Permitted Swap Obligations" means all obligations (contingent or
otherwise) of the Company or any Subsidiary existing or arising under Swap
Contracts, provided that each of the following criteria is satisfied: (a) such
obligations are (or were) entered into by such Person in the ordinary course of
business for the purpose of directly mitigating risks associated with
liabilities, commitments or assets held or reasonably anticipated by such
Person, or changes in the value of securities issued by such Person in
conjunction with a securities repurchase program not otherwise prohibited
hereunder, and not for purposes of speculation or taking a "market view;" (b)
such Swap Contracts do not contain any provision ("walk-away" provision)
exonerating the non-defaulting party from its obligation to make payments on
outstanding transactions to the defaulting party.

"Person" means an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated
association, joint venture or Governmental Authority.

"Plan" means an employee benefit plan (as defined in Section 3(3) of
ERISA) which the Company or an ERISA Affiliate sponsors or maintains or to
which the Company or an ERISA Affiliate makes, is making, or is obligated to
make contributions and includes any Pension Plan.

"Pledge Agreement" means the Pledge Agreement in substantially the form of
Exhibit 1.01A hereto, dated as of the date hereof, made by the Company in favor
of the beneficiaries named therein, as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms and the terms
hereof.

"Pledged Notes" shall be the collective reference to the promissory notes
from time to time pledged to the Agent pursuant to the Pledge Agreement.

"Pro Rata Share" means, as to any Bank at any time, the percentage
equivalent (expressed as a decimal, rounded to the ninth decimal place) at such
time of such Bank's Commitment divided by the combined Commitments of all
Banks.

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<PAGE> 30

"Refinancing Indebtedness" means Indebtedness incurred to refinance other
Indebtedness as long as such refinancing does not (i) result in an increase in
the total principal amount thereof or (ii) create Indebtedness with a weighted
average life to maturity that is less than the weighted average life to
maturity of the Indebtedness being refinanced or shorten the final maturity of
the Indebtedness being refinanced, provided that if such Indebtedness being
refinanced is Indebtedness of the Company, then such Refinancing Indebtedness
shall be Indebtedness solely of the Company.

"Replacement Bank" has the meaning specified in Section 4.08.

"Reportable Event" means, any of the events set forth in Section 4043(c)
of ERISA or the regulations thereunder, other than any such event for which the
30-day notice requirement under ERISA has been waived in regulations issued by
the PBGC.

"Requirement of Law" means, as to any Person, any law (statutory or
common), treaty, rule or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person
or any of its property or to which the Person or any of its property is
subject.

"Responsible Officer" means the chief executive officer, the chief
operating officer or the president of the Company, or any other officer having
substantially the same authority and responsibility; or, with respect to
compliance with financial covenants, the chief financial officer, the
controller or the treasurer of the Company, or any other officer having
substantially the same authority and responsibility.

"Revolving Loan" has the meaning specified in Section 2.01.

"Revolving Termination Date" means the earlier to occur of:

(a) July 1, 2001; and

(b) the date on which the Commitments terminate in accordance with
the provisions of this Agreement.

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<PAGE> 31

"Sale and Leaseback Transaction" means any arrangement, directly or
indirectly, whereby a seller or transferor shall sell or otherwise transfer any
real or personal property and then or thereafter lease, or repurchase under an
extended purchase contract, conditional sales or other title retention
agreement, the same or similar property.

"Same Day Funds" means (i) with respect to disbursements and payments
in Dollars, immediately available funds, and (ii) with respect to disbursements
and payments in an Offshore Currency, same day or other funds as may be
determined by the Agent to be customary in the place of disbursement or payment
for the settlement of international banking transactions in the relevant
Offshore Currency.

"SEC" means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.

"Spot Rate" for a currency means the rate quoted by BofA as the spot
rate for the purchase by BofA of such currency with another currency through
its FX Trading Office at approximately 10:00 a.m. (Chicago time) on the date
two Banking Days prior to the date as of which the foreign exchange computation
is made.

"Subordinated Debt" shall mean

(a) the Indebtedness evidenced by the
Subordinated Notes, and

(b) all other unsecured Indebtedness of the Company for
money borrowed which is subordinated in form and substance to the Obligations,
and which has terms of payment, covenants and remedies, all satisfactory to the
Majority Banks as evidenced by their written approval thereof.

"Subordinated Debt Indenture" means that certain Indenture dated as of
September 15, 1992 among the Company, as issuer, certain Subsidiaries, as
guarantors, and Fleet National Bank (as successor to The Connecticut National
Bank), as indenture trustee, in connection with the issuance of the
Subordinated Notes, as the same may be amended form time to time in compliance
with this Agreement.

"Subordinated Notes" means certain senior subordinated notes of the
Company with a maturity of ten (10) years, bearing interest at a rate of 9 3/4%
per annum payable semi-annually issued pursuant to the Subordinated Debt
Indenture and substantially in the form of the note set forth as Exhibit A to
the Subordinated Debt Indenture, as the same may be amended from time to time
in compliance with this Agreement.

"Subsidiary" of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business entity
of which more than 50% of the voting stock , membership interests or other
equity interests (in the case of Persons other than corporations), is owned or
controlled directly or indirectly by the Person, or one or

24
<PAGE> 32

more of the Subsidiaries of the Person, or a combination thereof. Unless the
context otherwise clearly requires, references herein to a "Subsidiary" refer
to a Subsidiary of the Company.

"Subsidiary Guaranty Agreement" means the Amended and Restated
Subsidiary Guaranty Agreement in substantially the form of Exhibit 1.01B
hereto, dated as of the date hereof, made by the Subsidiary Guarantors in favor
of the beneficiaries named therein, as the same may be amended, supplemented or
otherwise modified from time to time in accordance with its terms and the terms
hereof.

"Subsidiary Guarantor" means, individually, each of the Domestic
Subsidiaries of the Company signatory to the Subsidiary Guaranty Agreement and
such other Subsidiaries from time to time party to such Agreement and
collectively, all of such Subsidiaries.

"Surety Instruments" means all letters of credit (including standby
and commercial), banker's acceptances, bank guaranties, shipside bonds, surety
bonds and similar instruments.

"Swap Contract" means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap or
option, bond, note or bill option, interest rate option, forward foreign
exchange transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other, similar
transaction (including any option to enter into any of the foregoing) or any
combination of the foregoing, and, unless the context otherwise clearly
requires, any master agreement relating to or governing any or all of the
foregoing.

"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a) the amount(s) determined as the
mark-to-market value(s) for such Swap Contracts, as determined by the Company
based upon one or more mid-market or other readily available quotations
provided by any recognized dealer in such Swap Contracts (which may include any
Bank.)

"Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of
each Bank and the Agent, respectively, taxes imposed on or measured by its net
income by the jurisdiction (or any political subdivision thereof) under the
laws of which such Bank or the Agent, as the case may be, is organized or
maintains a lending office.

"Total Capitalization" means the sum of Funded Debt and total
stockholders' equity (excluding treasury stock) of the Company.

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<PAGE> 33

"Type" has the meaning specified in the definition of "Committed
Loan."

"Unfunded Pension Liability" means the excess of a Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Plan's assets, determined in accordance with the assumptions used
for funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.

"United States" and "U.S." each means the United States of America.

"Wholly-Owned Subsidiary" means any corporation in which (other than
directors' qualifying shares required by law) 100% of the capital stock
of each class having ordinary voting power, and 100% of the capital stock of
every other class, in each case, at the time as of which any determination
is being made, is owned, beneficially and of record, by the Company, or by
one or more of the other Wholly-Owned Subsidiaries, or both.

1.02 Other Interpretive Provisions.

(a) The meanings of defined terms are equally applicable to
the singular and plural forms of the defined terms.

(b) The words "hereof", "herein", "hereunder" and similar
words refer to this Agreement as a whole and not to any particular
provision of this Agreement; and subsection, Section, Schedule
and Exhibit references are to this Agreement unless otherwise
specified.

(c) (i) The term "documents" includes any and all
instruments, documents, agreements, certificates, indentures, notices
and other writings, however evidenced.

(ii) The term "including" is not limiting and means
"including without limitation."

(iii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means
"from and including"; the words "to" and "until" each mean "to but
excluding", and the word "through" means "to and including."

(d) Unless otherwise expressly provided herein, (i)
references to agreements (including this Agreement) and other contractual
instruments shall be deemed to include all subsequent amendments and other
modifications thereto, but only to the extent such amendments and other
modifications are not prohibited by the terms of any Loan Document, and (ii)
references to any statute or regulation are to be construed as including all
statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting the statute or regulation.

(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.

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<PAGE> 34

(f) This Agreement and other Loan Documents may use
several different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are cumulative
and shall each be performed in accordance with their terms.

(g) This Agreement and the other Loan Documents are the
result of negotiations among and have been reviewed by counsel to the Agent,
the Company and the other parties, and are the products of all parties.
Accordingly, they shall not be construed against the Banks or the Agent merely
because of the Agent's or Banks' involvement in their preparation.

1.03 Accounting Principles.

(a) Unless the context otherwise clearly requires, all
accounting terms not expressly defined herein shall be construed, and all
financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied.

(b) References herein to "fiscal year" and "fiscal
quarter" refer to such fiscal periods of the Company.

1.04 Currency Equivalents Generally. For all purposes of this
Agreement (but not for purposes of the preparation of any financial statements
delivered pursuant hereto), the equivalent in any Offshore Currency or other
currency of an amount in Dollars, and the equivalent in Dollars of an amount in
any Offshore Currency or other currency, shall be determined at the Spot Rate.

ARTICLE II

THE CREDITS

2.01 Amounts and Terms of Commitments. Each Bank severally agrees,
on the terms and conditions set forth herein, to make loans to the Company
(each such loan, a "Revolving Loan") from time to time on any Business Day
during the period from the Closing Date to the Revolving Termination Date, in
an aggregate principal Dollar Equivalent amount not to exceed at any time
outstanding the amount set forth opposite the Bank's name in Schedule 2.01(b)
under the heading "Commitment" (such amount as the same may be reduced pursuant
to Section 2.05 or as a result of one or more assignments pursuant to Section
11.08, the Bank's "Commitment"); provided, however, that, after giving effect
to any Borrowing of Revolving Loans, the aggregate principal Dollar Equivalent
amount of all outstanding Loans and L/C Obligations shall not exceed the
combined Commitments; and provided further that, after giving effect to any
Borrowing of Offshore Currency Loans, the aggregate principal Dollar Equivalent
amount of all outstanding Offshore Currency Loans and L/C Obligations
denominated in an Offshore L/C Currency shall not exceed the Offshore Currency
Loan Sublimit. Within the limits of each Bank's Commitment, and subject to the
other terms and conditions hereof, the Company may borrow under this Section
2.01, prepay pursuant to Section 2.09 and reborrow pursuant to this Section
2.01. On the Closing Date and prior to any Borrowing hereunder, each Bank
which was not a Bank under the Original Credit Agreement

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<PAGE> 35

("Original Bank") shall purchase on the Closing Date its Pro Rata Share of the
Loans of each Original Bank that are outstanding under the Original Credit
Agreement immediately prior to the effectiveness of this Agreement and such
aggregate amount shall constitute its Revolving Loan on the date hereof.

2.02 Loan Accounts.

(a) The Loans made by each Bank or Designated Bidder
shall be evidenced by one or more loan accounts or records maintained by such
Bank or Designated Bidder in the ordinary course of business. The loan
accounts or records maintained by the Agent and each Bank or Designated Bidder
shall be rebuttably presumptive evidence of the amount of the Loans made by the
Banks and Designated Bidders to the Company and the interest and payments
thereon. Any failure so to record or any error in doing so shall not, however,
limit or otherwise affect the obligation of the Company hereunder to pay any
amount owing with respect to the Loans.

(b) Upon the request of any Bank or Designated Bidder
made through the Agent, the Committed Loans made by such Bank may be evidenced
by one or more notes in substantially the form of Exhibit 2.02 ("Committed Loan
Notes") and the Bid Loans made by such Bank or Designated Bidder may be
evidenced by one or more notes ("Bid Loan Notes"), instead of or in addition to
loan accounts. Each such Bank or Designated Bidder shall endorse on the
schedules annexed to its Note(s) the date, amount and maturity of each Loan
made by it and the amount of each payment of principal made by the Company with
respect thereto. Each such Bank and Designated Bidder is irrevocably
authorized by the Company to endorse its Note(s) and each Bank's or Designated
Bidder's record shall be rebuttably presumptive evidence of the matters set
forth therein absent manifest error; provided, however, that the failure of a
Bank or Designated Bidder to make, or an error in making, a notation thereon
with respect to any Loan shall not limit or otherwise affect the obligations of
the Company hereunder or under any such Note to such Bank or Designated Bidder.

2.03 Procedure for Committed Borrowing.

(a) Each Committed Borrowing shall be made upon the
Company's irrevocable written notice delivered to the Agent in the form of a
Notice of Borrowing (which notice must be received by the Agent prior to 10:30
a.m. (Chicago time) (i) four Business Days prior to the requested Borrowing
Date, in the case of Offshore Currency Loans; (ii) two Business Days prior to
the requested Borrowing Date, in the case of Offshore Rate Loans denominated in
Dollars; and (iii) on the requested Borrowing Date, in the case of Base Rate
Loans, in any such case, specifying:

(A) the amount of the Committed Borrowing,
which shall be in an aggregate amount not less than the
Minimum Tranche;

(B) the requested Borrowing Date, which
shall be a Business Day;

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<PAGE> 36

(D) the duration of the Interest Period
applicable to any Offshore Rate Loan included in such
notice. If the Notice of Borrowing fails to specify the
duration of the Interest Period for any Committed Borrowing
comprised of Offshore Rate Loans, such Interest Period shall
be one month; and

(E) in the case of a Committed Borrowing
comprised of Offshore Currency Loans, the Applicable
Currency.

provided, however, that with respect to the Borrowing to be made on the Closing
Date, the Notice of Borrowing shall be delivered to the Agent not later than
10:30 a.m. (Chicago time) on the Closing Date and unless the Company has
provided the applicable advance notice for Offshore Rate Loans and has agreed
to pay funding losses in the same manner as set forth in Section 4.04 hereof,
such Borrowing will consist of Base Rate Loans only.

(b) The Dollar Equivalent amount of any Committed
Borrowing in an Offshore Currency will be determined by the Agent for such
Committed Borrowing on the Computation Date therefor in accordance with
subsection 2.05(a). Upon receipt of the Notice of Borrowing, the Agent will
promptly notify each Bank thereof and of the amount of such Bank's Pro Rata
Share of the Committed Borrowing. In the case of a Committed Borrowing
comprised of Offshore Currency Loans, such notice will provide the approximate
amount of each Bank's Pro Rata Share of the Committed Borrowing, and the Agent
will, upon the determination of Dollar Equivalent amount of the Committed
Borrowing as specified in the Notice of Borrowing, promptly notify each Bank of
the exact amount of such Bank's Pro Rata Share of the Committed Borrowing.

(c) Each Bank will make the amount of its Pro Rata Share
of each Committed Borrowing available to the Agent for the account of the
Company at the Agent's Payment Office by 12:00 noon (Chicago time) on the
Borrowing Date requested by the Company in Same Day Funds and in the requested
currency (i) in the case of a Committed Borrowing comprised of Loans in
Dollars, by 12:00 noon (Chicago time), (ii) in the case of a Committed
Borrowing comprised of Offshore Currency Loans, by such time as the Agent may
specify. The proceeds of all such Committed Loans will then be made available
to the Company by the Agent at such office by crediting the account of the
Company on the books of BofA with the aggregate of the amounts made available
to the Agent by the Banks and in by wire transfer in accordance with written
instructions provided to the Agent by the Company of like funds as received by
the Agent.

(d) After giving effect to any Borrowing, unless the
Agent shall otherwise consent, there may not be more than ten different
Interest Periods in effect in respect of all Committed Loans and Bid Loans
together than outstanding.

2.04 Conversion and Continuation Elections for Committed Loans.

(a) The Company may, upon irrevocable written notice to the
Agent in accordance with subsection 2.04(b):

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<PAGE> 37

(i) elect, as of any Business Day, in the case of
Base Rate Committed Loans, or as of the last day of the
applicable Interest Period, in the case of any other Type of Committed
Loans denominated in Dollars, to convert any such Loans (or any part
thereof in an amount not less than the Minimum Tranche) into Loans in
Dollars of any other Type; or

(ii) elect, as of the last day of the applicable
Interest Period, to continue any Committed Loans having
Interest Periods expiring on such day (or any part thereof in an
amount not less than the Minimum Tranche);

provided, that if at any time the aggregate amount of Offshore Rate Committed
Loans denominated in Dollars in respect of any Committed Borrowing is reduced,
by payment, prepayment, or conversion of part thereof to be less than the
Minimum Tranche, such Offshore Rate Loans denominated in Dollars shall
automatically convert into Base Rate Loans.

(b) The Company shall deliver a Notice of
Conversion/Continuation to be received by the Agent not later than 10:30 a.m.
(Chicago time) at least (i) two Business Days in advance of the
Conversion/Continuation Date, if the Committed Loans are to be converted into
or continued as Offshore Rate Committed Loans denominated in Dollars; (ii) four
Business Days in advance of the continuation date, if the Committed Loans are
to be continued as Offshore Currency Committed Loans; and (iii) on the
Conversion/Continuation Date, if the Committed Loans are to be converted into
Base Rate Committed Loans, specifying:

(A) the proposed Conversion/Continuation Date;

(B) the aggregate amount of Committed Loans to be
converted or continued;

(D) other than in the case of conversions into Base
Rate Committed Loans, the duration of the requested Interest
Period.

(c) If upon the expiration of any Interest Period
applicable to Offshore Rate Committed Loans in Dollars, the Company has failed
to select timely a new Interest Period to be applicable to such Offshore Rate
Committed Loans or if any Default or Event of Default then exists, unless, in
either case, the Company has elected to repay such Committed Loan, the Company
shall be deemed to have elected to convert such Offshore Rate Committed Loans
into Base Rate Loans effective as of the expiration date of such Interest
Period. If the Company has failed to select a new Interest Period to be
applicable to Offshore Currency Committed Loans prior to the fourth Business
Day in advance of the expiration date of the current Interest Period applicable
thereto as provided in subsection 2.04(b), or if any Default or Event of
Default shall then exist, subject to the provisions

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<PAGE> 38

of subsection 2.05(d), the Company shall be deemed to have elected to continue
such Offshore Currency Committed Loans on the basis of a one month Interest
Period.

(d) The Agent will promptly notify each Bank of its
receipt of a Notice of Conversion/Continuation, or, if no timely notice is
provided by the Company, the Agent will promptly notify each Bank of the
details of any automatic conversion. All conversions and continuations shall
be made ratably according to the respective outstanding principal amounts of
the Committed Loans with respect to which the notice was given held by each
Bank.

(e) Unless the Majority Banks otherwise consent, during
the existence of a Default or Event of Default, the Company may not elect to
have a Committed Loan in Dollars converted into or continued as an Offshore
Rate Committed Loan in Dollars or an Offshore Currency Loan continued on the
basis of an Interest Period exceeding one month.

(f) After giving effect to any conversion or continuation
of Committed Loans, unless the Agent shall otherwise consent, there may not be
more than ten different Interest Periods in effect.

2.05 Utilization of Revolving Commitments in Offshore Currencies.

(a) The Agent will determine the Dollar Equivalent amount
with respect to any (i) Committed Borrowing comprised of Offshore Currency
Committed Loans as of the requested Borrowing Date, (ii) outstanding Offshore
Currency Committed Loans as of the last Banking Day of each month, and (iii)
outstanding Offshore Currency Committed Loans as of any redenomination date
pursuant to this Section 2.05 or Section 4.05 (each such date under clauses (i)
through (iii) a "Computation Date").

(b) In the case of a proposed Committed Borrowing
comprised of Offshore Currency Committed Loans, the Banks shall be under no
obligation to make Offshore Currency Committed Loans in the requested Offshore
Currency as part of such Committed Borrowing if the Agent has received notice
from any of the Banks by 3:00 p.m. (Chicago time) four Business Days prior to
the day of such Committed Borrowing that such Bank cannot provide Loans in the
requested Offshore Currency, in which event the Agent will give notice to the
Company no later than 10:30 a.m. (Chicago time) on the third Business Day
prior to the requested date of such Borrowing that the Committed Borrowing in
the requested Offshore Currency is not then available, and notice thereof also
will be given promptly by the Agent to the Banks. If the Agent shall have so
notified the Company that any such Committed Borrowing in a requested Offshore
Currency is not then available, the Company may, by notice to the Agent not
later than 4:30 p.m. (Chicago time) three Business Days prior to the requested
date of such Committed Borrowing, withdraw the Notice of Borrowing relating to
such requested Committed Borrowing. If the Company does so withdraw such
Notice of Borrowing, the Committed Borrowing requested therein shall not occur
and the Agent will promptly so notify each Bank. If the Company does not so
withdraw such Notice of Borrowing, the Agent will promptly so notify each Bank
and such Notice of Borrowing shall be deemed to be a Notice of Borrowing that
requests a Committed Borrowing comprised of Base Rate

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<PAGE> 39

Committed Loans in an aggregate amount equal to the amount of the originally
requested Borrowing as expressed in Dollars in the Notice of Borrowing; and in
such notice by the Agent to each Bank the Agent will state such aggregate
amount of such Committed Borrowing in Dollars and such Bank's Pro Rata Share
thereof.

(c) In the case of a proposed continuation of Offshore
Currency Committed Loans for an additional Interest Period pursuant to Section
2.04, the Banks shall be under no obligation to continue such Offshore Currency
Committed Loans if the Agent has received notice from any of the Banks by 3:00
p.m. (Chicago time) four Business Days prior to the day of such continuation
that such Bank cannot continue to provide Committed Loans in the relevant
Offshore Currency, in which event the Agent will give notice to the Company not
later than 10:30 a.m. (Chicago time) on the third Business Day prior to the
requested date of such continuation that the continuation of such Offshore
Currency Committed Loans in the relevant Offshore Currency is not then
available, and notice thereof also will be given promptly by the Agent to the
Banks. If the Agent shall have so notified the Company that any such
continuation of Offshore Currency Committed Loans is not then available, any
Notice of Continuation/Conversion with respect thereto shall be deemed
withdrawn and such Offshore Currency Committed Loans shall be redenominated
into Base Rate Committed Loans in Dollars with effect from the last day of the
Interest Period with respect to any such Offshore Currency Committed Loans.
The Agent will promptly notify the Company and the Banks of any such
redenomination and in such notice by the Agent to each Bank the Agent will
state the aggregate Dollar Equivalent amount of the redenominated Offshore
Currency Committed Loans as of the Computation Date with respect thereto and
such Bank's Pro Rata Share thereof.

(d) Notwithstanding anything herein to the contrary,
during the existence of an Event of Default, upon the request of the Majority
Banks, all or any part of any outstanding Offshore Currency Committed Loans
shall be redenominated and converted into Base Rate Committed Loans in Dollars
with effect from the last day of the Interest Period with respect to any such
Offshore Currency Committed Loans. The Agent will promptly notify the Company
of any such redenomination and conversion request.

(e) The Company shall be entitled to request that
Revolving Loans hereunder also be permitted to be made in any other lawful
currency (other than Dollars), in addition to the eurocurrencies specified in
the definition of "Offshore Currency" herein, that in the opinion of the
Majority Banks is at such time freely traded in the offshore interbank foreign
exchange markets and is freely transferable and freely convertible into Dollars
(an "Agreed Alternative Currency"). The Company shall deliver to the Agent any
request for designation of an Agreed Alternate Currency in accordance with
Section 11.02, to be received by the Agent not later than 12:00 p.m. (Chicago
time) at least ten Business Days in advance of the date of any Committed
Borrowing hereunder proposed to be made in such Agreed Alternate Currency.
Upon receipt of any such request the Agent will promptly notify the Banks
thereof, and each Bank will use its best efforts to respond to such request
within two Business Days of receipt thereof. Each Bank may grant or accept
such request in its sole discretion. The Agent will promptly notify the
Company of the acceptance or rejection of any such request.

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<PAGE> 40

2.06 Bid Borrowings. In addition to Committed Borrowings pursuant
to Section 2.03, each Bank severally agrees that the Company may, as set forth
in Section 2.07, from time to time request the Banks prior to the Revolving
Termination Date to submit offers to make Bid Loans to the Company; provided,
however, that the Banks may, but shall have no obligation to, submit such
offers and the Company may, but shall have no obligation to, accept any such
offers, and any Bank may designate a Designated Bidder to make such offers from
time to time and, if such offers are accepted by the Company, to make such Bid
Loans; and provided, further, that at no time shall (a) the outstanding
aggregate principal amount of all Bid Loans made by all Banks and Designated
Bidders, plus the outstanding aggregate principal amount of all Committed Loans
made by all Banks exceed the combined Commitments; (b) the outstanding
aggregate principal Dollar Equivalent amount of all Bid Loans made by all Banks
and Designated Bidders exceed the lesser of $75,000,000 or 50% of the combined
Commitments; or (c) the number of Interest Periods for Bid Loans then
outstanding plus the number of Interest Periods for Committed Loans then
outstanding exceeds ten.

2.07 Procedure for Bid Borrowings.

(a) When the Company wishes to request the Banks to
submit offers to make Bid Loans hereunder, it shall transmit to the Agent by
telephone call followed promptly by facsimile transmission a notice in
substantially the form of Exhibit 2.07(a) (a "Competitive Bid Request") so as
to be received no later than 9:00 a.m. (Chicago time) (x) four Business Days
prior to the date of a proposed Bid Borrowing in the case of a LIBOR Auction,
or (y) two Business Days prior to the date of a proposed Bid Borrowing in the
case of an Absolute Rate Auction, specifying:

(i) the date of such Bid Borrowing, which shall be a
Business Day;

(ii) the aggregate amount of such Bid Borrowing,
which shall be a minimum amount of $5,000,000 or in multiples
of $1,000,000 in excess thereof;

(iii) whether the Competitive Bids requested are to
be for LIBOR Bid Loans or Absolute Rate Bid Loans or both; and

(iv) the duration of the Interest Period applicable
thereto, subject to the provisions of the definition of "Interest
Period" herein.

Subject to subsection 2.07(c), the Company may not request Competitive Bids for
more than three Interest Periods in a single Competitive Bid Request and may
not request Competitive Bids more than once in any period of five Business
Days.

(b) Upon receipt of a Competitive Bid Request, the Agent
will promptly send to the Banks and Designated Bidders by facsimile
transmission an Invitation for Competitive Bids, which shall constitute an
invitation by the Company to each Bank and Designated Bidder to submit

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<PAGE> 41

Competitive Bids offering to make the Bid Loans to which such Competitive Bid
Request relates in accordance with this Section 2.07.

(c) (i) Each Bank and Designated Bidder may at its discretion
submit a Competitive Bid containing an offer or offers to make Bid
Loans in response to any Invitation for Competitive Bids. Each Competitive
Bid must comply with the requirements of this subsection 2.07(c) and must
be submitted to the Agent by facsimile transmission at the Agent's office
for notices set forth on the signature pages hereto not later than (a) 8:30
a.m. (Chicago time) three Business Days prior to the proposed date of
Borrowing, in the case of a LIBOR Auction or (2) 8:30 a.m. (Chicago time)
on the proposed date of Borrowing, in the case of an Absolute Rate Auction;
provided that Competitive Bids submitted by the Agent (or any Affiliate of
the Agent) in the capacity of a Bank or Designated Bidder may be submitted,
and may only be submitted, if the Agent or such Affiliate notifies the
Company of the terms of the offer or offers contained therein not later
than (A) 8:15 a.m. (Chicago time) three Business Days prior to the proposed
date of Borrowing, in the case of a LIBOR Auction or (B) 8:15 a.m. (Chicago
time) on the proposed date of Borrowing, in the case of an Absolute Rate
Auction.

(ii) Each Competitive Bid shall be in substantially the form
of Exhibit 2.07(c), specifying therein:

(A) the proposed date of Borrowing;

(B) the principal amount of each Bid Loan for which
such Competitive Bid is being made, which principal amount (x)
may be equal to, greater than or less than the Commitment of
the quoting Bank, (y) must be $5,000,000 or in multiples of
$1,000,000 in excess thereof, and (z) may not exceed the
principal amount of Bid Loans for which Competitive Bids were
requested;

(C) in case the Company elects a LIBOR Auction, the
margin above or below LIBOR (the " LIBOR Bid Margin") offered
for each such Bid Loan, expressed in multiples of 1/1000th
of one basis point to be added to or subtracted from the
applicable LIBOR and the Interest Period applicable thereto;

(D) in case the Company elects an Absolute Rate
Auction, the rate of interest per annum expressed in multiples
of 1/1000th of one basis point (the "Absolute Rate") offered
for each such Bid Loan; and

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<PAGE> 42

(E) the identity of the quoting Bank or Designated
Bidder.

A Competitive Bid may contain up to three separate offers by the
quoting Bank or Designated Bidder with respect to each Interest Period
specified in the related Invitation for Competitive Bids.

(iii) Any Competitive Bid shall be disregarded if it:

(A) is not substantially in conformity with Exhibit
2.07(c) or does not specify all of the information required by
subsection (c)(ii) of this Section;

(B) contains qualifying, conditional or similar
language;

(D) arrives after the time set forth in subsection
(c)(i).

(d) Promptly on receipt and not later than 9:00 a.m.
(Chicago time) three Business Days prior to the proposed date of Borrowing in
the case of a LIBOR Auction, or 9:00 a.m. (Chicago time) on the proposed date
of Borrowing, in the case of an Absolute Rate Auction, the Agent will notify
the Company of the terms (i) of any Competitive Bid submitted by a Bank or
Designated Bidder that is in accordance with subsection 2.07(c), and (ii) of
any Competitive Bid that amends, modifies or is otherwise inconsistent with a
previous Competitive Bid submitted by such Bank or Designated Bidder with
respect to the same Competitive Bid Request. Any such subsequent Competitive
Bid shall be disregarded by the Agent unless such subsequent Competitive Bid is
submitted solely to correct a manifest error in such former Competitive Bid and
only if received within the times set forth in subsection 2.07(c). The Agent's
notice to the Company shall specify (1) the aggregate principal amount of Bid
Loans for which offers have been received for each Interest Period specified in
the related Competitive Bid Request; and (2) the respective principal amounts
and LIBOR Bid Margins or Absolute Rates, as the case may be, so offered.
Subject only to the provisions of Sections 4.02, 4.05 and 5.02 hereof and the
provisions of this subsection (d), any Competitive Bid shall be irrevocable
except with the written consent of the Agent given on the written instructions
of the Company.

(e) Not later than 9:30 a.m. (Chicago time) three
Business Days prior to the proposed date of Borrowing, in the case of a LIBOR
Auction, or 9:30 a.m. (Chicago time) on the proposed date of Borrowing, in the
case of an Absolute Rate Auction, the Company shall notify the Agent of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection

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<PAGE> 43

2.07(d). The Company shall be under no obligation to accept any offer and may
choose to reject all offers. In the case of acceptance, such notice shall
specify the aggregate principal amount of offers for each Interest Period that
is accepted. The Company may accept any Competitive Bid in whole or in part;
provided that:

(i) the aggregate principal amount of each Bid
Borrowing may not exceed the applicable amount set
forth in the related Competitive Bid Request;

(ii) the principal amount of each Bid Borrowing must
be $5,000,000 or in any multiple of $1,000,000 in
excess thereof;

(iii) acceptance of offers may only be made on the
basis of ascending LIBOR Bid Margins or Absolute Rates
within each Interest Period, as the case may be; and

(iv) the Company may not accept any offer that is
described in subsection 2.07(c)(iii) or that otherwise
fails to comply with the requirements of this Agreement.

(f) If offers are made by two or more Banks or Designated
Bidders with the same LIBOR Bid Margins or Absolute Rates, as the case may be,
for a greater aggregate principal amount than the amount in respect of which
such offers are accepted for the related Interest Period, the principal amount
of Bid Loans in respect of which such offers are accepted shall be allocated by
the Agent among such Banks or Designated Bidders as nearly as possible (in such
multiples, not less than $1,000,000, as the Agent may deem appropriate) in
proportion to the aggregate principal amounts of such offers. Determination by
the Agent of the amounts of Bid Loans shall be conclusive in the absence of
manifest error.

(g) (i) The Agent will promptly notify each Bank
or Designated Bidder having submitted a Competitive Bid if its
offer has been accepted and, if its offer has been accepted, of the
amount of the Bid Loan or Bid Loans to be made by it on the date of
the Bid Borrowing.

(ii) Each Bank or Designated Bidder, which has
received notice pursuant to subsection 2.07(g)(i) that its
Competitive Bid has been accepted, shall make the amounts of such
Bid Loans available to the Agent for the account of the Company at
the Agent's Payment Office, by 1:00 p.m. (Chicago time) in the case
of Absolute Rate Bid Loans, and by 1:00 p.m. (Chicago time) in the
case of LIBOR Bid Loans, on such date of Bid Borrowing, in funds
immediately available to the Agent for the account of the Company at
the Agent's Payment Office.

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<PAGE> 44

(iii) Promptly following each Bid Borrowing, the
Agent shall notify each Bank and Designated Bidder of the ranges of
bids submitted and the highest and lowest Bids accepted for each
Interest Period requested by the Company and the aggregate amount
borrowed pursuant to such Bid Borrowing.

(iv) From time to time, the Company and the Banks
and Designated Bidders shall furnish such information to the Agent as
the Agent may request relating to the making of Bid Loans, including
the amounts, interest rates, dates of borrowings and maturities
thereof, for purposes of the allocation of amounts received from the
Company for payment of all amounts owing hereunder.

(h) If, on or prior to the proposed date of Borrowing,
the Commitments have not been terminated and if, on such proposed date of
Borrowing all applicable conditions to funding referenced in Sections 4.02,
4.05 and 5.02 hereof are satisfied, the Banks and Designated Bidders whose
offers the Company has accepted will fund each Bid Loan so accepted. Nothing
in this Section 2.07 shall be construed as a right of first offer in favor of
the Banks or Designated Bidders or to otherwise limit the ability of the
Company to request and accept credit facilities from any Person (including any
of the Banks or Designated Bidders), provided that no Default or Event of
Default would otherwise arise or exist as a result of the Company executing,
delivering or performing under such credit facilities.

2.08 Reduction of Commitments; Mandatory Prepayments.

(a) Scheduled Reductions. The combined Commitments shall
be automatically and permanently reduced by the amounts and on the dates set
forth below:

<TABLE>
<CAPTION>
Amount of Reduction
Date to combined Commitments
---- -----------------------
<S> <C>
July 1, 1999 $25,000,000
July 1, 2000 $25,000,000
</TABLE>

Each reduction of the Commitments shall be applied to each Bank according to
its Pro Rata Share. The Company agrees that it will, on or before the date of
any scheduled reduction pursuant to the above table, make a mandatory
prepayment to the Agent in the amount necessary to reduce the sum of the Dollar
Equivalent of (i) the aggregate principal amount of the outstanding Loans plus
(ii) the L/C Obligations to an amount which is less than or equal to the
combined Commitments after giving effect to such scheduled reduction.

(b) Voluntary Termination or Reduction of Commitments.
The Company may, upon not less than five Business Days' prior notice to the
Agent, terminate the Commitments, or

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<PAGE> 45

permanently reduce the Commitments by an aggregate minimum Dollar Equivalent
amount of $5,000,000 or any Dollar Equivalent multiple of $1,000,000 in excess
thereof; unless, after giving effect thereto and to any prepayments of Loans
made on the effective date thereof, the then-outstanding principal Dollar
Equivalent amount of the Loans and L/C Obligations would exceed the amount of
the combined Commitments then in effect. Once reduced in accordance with this
Section, the Commitments may not be increased. Any reduction of the
Commitments shall be applied to each Bank according to its Pro Rata Share. All
accrued commitment fees to, but not including the effective date of any
reduction or termination of Commitments, shall be paid on the effective date of
such reduction or termination.

2.09 Optional Prepayments.

(a) Subject to Section 4.04, unless waived by the Agent,
the Company may, at any time or from time to time, upon irrevocable notice to
the Agent not later than 10:30 a.m. (Chicago time) two Business Days before the
date of prepayment in the case of Offshore Currency Loans and on the date of
such prepayment in the case of other Loans, ratably prepay Loans in whole or in
part, in minimum Dollar Equivalent amounts of $1,000,000 or any Dollar
Equivalent multiple of $500,000 in excess thereof or such other amount
necessary to repay in full any Offshore Currency Loan. Such notice of
prepayment shall specify the date and amount of such prepayment and whether
such prepayment is of Base Rate Committed Loans, Offshore Rate Committed Loans,
or any combination thereof, and the Applicable Currency. Such notice shall not
thereafter be revocable by the Company and the Agent will promptly notify each
Bank thereof and of such Bank's Pro Rata Share of such prepayment. If such
notice is given by the Company, the Company shall make such prepayment and the
payment amount specified in such notice shall be due and payable on the date
specified therein, together with any amounts required pursuant to Section 4.04.

(b) Bid Loans may not be voluntarily prepaid other than
with the consent of the applicable Bid Loan Lender.

2.10 Currency Exchange Fluctuations. Subject to Section 4.04, if
on any Computation Date the Agent shall have determined that the aggregate
Dollar Equivalent principal amount of all Loans and L/C Obligations then
outstanding exceeds the combined Commitments of the Banks by more than
$500,000, due to a change in applicable rates of exchange between Dollars and
Offshore Currencies, then the Agent shall give notice to the Company that a
prepayment is required under this Section, and the Company agrees thereupon to
make prepayments of Loans such that, after giving effect to such prepayment the
aggregate Dollar Equivalent amount of all Loans does not exceed the combined
Commitments.

2.11 Mandatory Prepayments and Repayment.

(a) Mandatory Prepayments of Loans. Subject to Section
4.04, if on any date the Effective Amount of all Loans then outstanding plus
the Effective Amount of all L/C Obligations exceeds the aggregate Commitments
(other than as a result of currency exchange fluctuations), the Company shall
immediately, and without notice or demand, prepay the outstanding principal
amount

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<PAGE> 46

of the Loans in an amount equal to the lesser of such excess and the amount of
the outstanding Loans and, if any excess shall still remain, shall Cash
Collateralize the L/C Obligations to the extent of such remaining excess.

(b) Repayment. The Company shall repay to the Banks on
the Revolving Termination Date the aggregate principal amount of Loans
outstanding on such date. The Company shall repay each Bid Loan on the last
day of the relevant Interest Period.

2.12 Interest.

(a) Each Committed Loan shall bear interest on the
outstanding principal amount thereof from the applicable Borrowing Date at a
rate per annum equal to the Offshore Rate plus the Applicable Margin or the
Base Rate, as the case may be (and subject to the Company's right to convert to
other Types of Committed Loans under Section 2.04). Each Bid Loan shall bear
interest on the outstanding principal amount thereof from the relevant
Borrowing Date at the rate per annum equal to the LIBO Rate plus (or minus) the
LIBOR Bid Margin, or at the Absolute Rate, as the case may be.

(b) Interest on each Loan shall be paid in arrears on
each Interest Payment Date. Interest shall also be paid on the date of any
prepayment of Loans under Section 2.09 or 2.10 for the portion of the Loans so
prepaid and upon payment (including prepayment) in full thereof and, during the
existence of any Event of Default, interest shall be paid on demand of the
Agent at the request or with the consent of the Majority Banks.

(c) Notwithstanding subsection (a) of this Section, if
any amount of principal of or interest on any Loan, or any other amount payable
hereunder or under any other Loan Document is not paid in full when due
(whether at stated maturity, by acceleration, demand or otherwise), the Company
agrees to pay interest on such unpaid principal or other amount, from the date
such amount becomes due until the date such amount is paid in full, and after
as well as before any entry of judgment thereon to the extent permitted by law,
payable on demand, at a fluctuating rate per annum equal to the Base Rate plus
2%.

(d) Anything herein to the contrary notwithstanding, the
obligations of the Company to any Bank or Designated Bidder hereunder shall be
subject to the limitation that payments of interest shall not be required for
any period for which interest is computed hereunder, to the extent (but only to
the extent) that contracting for or receiving such payment by such Bank or
Designated Bidder would be contrary to the provisions of any law applicable to
such Bank or Designated Bidder limiting the highest rate of interest that may
be lawfully contracted for, charged or received by such Bank, and in such event
the Company shall pay such Bank or Designated Bidder interest at the highest
rate permitted by applicable law.

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<PAGE> 47

2.13 Fees.

(a) Arrangement, Agency Fees. The Company shall pay an
arrangement fee to the Arranger for the Arranger's own account, and shall pay
an agency fee to the Agent for the Agent's own account, as required by the
letter agreement ("Fee Letter") between the Company and the Arranger and Agent
dated June 4, 1996. On the date of each Competitive Bid Request, the Company
shall pay to the Agent for the Agent's own account a bid auction fee of $150
per Bank per Competitive Bid Request.

(b) Amendment Fee. On the Closing Date, the Company
shall pay to the Agent for the account of each Bank an amendment fee of .10% of
each Bank's Commitment.

(c) Facility Fees. The Company shall pay to the Agent
for the account of each Bank a facility fee on the average daily Commitment for
such Bank, computed on a quarterly basis in arrears on the last Business Day of
each calendar quarter based upon the daily Commitments for that quarter as
calculated by the Agent, equal to the Applicable Facility Fee Percentage. Such
facility fee shall accrue from the Closing Date to the Revolving Termination
Date and shall be due and payable quarterly in arrears on the last Business Day
of each fiscal quarter commencing on September 30, 1996 through the Revolving
Termination Date, with the final payment to be made on the Revolving
Termination Date; provided that, in connection with any reduction or
termination of Commitments under Section 2.08, the accrued facility fee
calculated for the period ending on such date shall also be paid on the date of
such reduction or termination, with the following quarterly payment being
calculated on the basis of the period from such reduction or termination date
to such quarterly payment date. The facility fees provided in this subsection
shall accrue at all times after the above-mentioned commencement date,
including at any time during which one or more conditions in Article V are not
met.

2.14 Computation of Fees and Interest.

(a) All computations of interest for Base Rate Committed
Loans and of fees shall be made on the basis of a year of 365 or 366 days, as
the case may be, and actual days elapsed. All other computations of interest
shall be made on the basis of a 360-day year and actual days elapsed (which
results in more interest being paid than if computed on the basis of a 365-day
year). Interest and fees shall accrue during each period during which interest
or such fees are computed from the first day thereof to the last day thereof.

(b) Each determination of an interest rate or a Dollar
Equivalent amount by the Agent shall be rebuttably presumptive evidence thereof
in the absence of manifest error. The Agent will, at the request of the Company
or any Bank, deliver to the Company or any Bank or Designated Bidder, as the
case may be, a statement showing the quotations used by the Agent in
determining any interest rate or Dollar Equivalent amount.

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2.15 Payments by the Company.

(a) All payments to be made by the Company shall be made
without set-off, recoupment or counterclaim. Except as otherwise expressly
provided herein, all payments by the Company shall be made to the Agent for the
account of the Banks and Designated Bidders at the Agent's Payment Office, and,
with respect to principal of, interest on, and any other amounts relating to,
any Offshore Currency Loan, shall be made in the Offshore Currency in which
such Loan is denominated or payable, and, with respect to all other amounts
payable hereunder, shall be made in Dollars. Such payments shall be made in
Same Day Funds, and (i) in the case of Offshore Currency payments, no later
than such time on the dates specified herein as may be determined by the Agent
to be necessary for such payment to be credited on such date in accordance with
normal banking procedures in the place of payment, and (ii) in the case of any
Dollar payments, no later than 12:00 noon (Chicago time) on the date specified
herein. The Agent will promptly distribute to each Bank (or Designated Bidder)
its Pro Rata Share (or other applicable share as expressly provided herein) of
such principal, interest, fees or other amounts, in like funds as received.
Any payment which is received by the Agent later than 12:00 noon (Chicago
time), or later than the time specified by the Agent as provided in clause (i)
above (in the case of Offshore Currency payments), shall be deemed to have been
received on the following Business Day and any applicable interest or fee shall
continue to accrue.

(b) Subject to the provisions set forth in the definition
of "Interest Period" herein, whenever any payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and
such extension of time shall in such case be included in the computation of
interest or fees, as the case may be.

(c) Unless the Agent receives notice from the Company
prior to the date on which any payment is due to the Banks or Designated
Bidders that the Company will not make such payment in full as and when
required, the Agent may assume that the Company has made such payment in full
to the Agent on such date in Same Day Funds and the Agent may (but shall not be
so required), in reliance upon such assumption, distribute to each Bank or
Designated Bidder on such due date an amount equal to the amount then due such
Bank or Designated Bidder. If and to the extent the Company has not made such
payment in full to the Agent, each Bank or Designated Bidders shall repay to
the Agent on demand such amount distributed to such Bank or Designated Bidder,
together with interest thereon at the Federal Funds Rate or, in the case of a
payment in an Offshore Currency, the Overnight Rate, for each day from the date
such amount is distributed to such Bank or Designated Bidder until the date
repaid.

2.16 Payments by the Banks to the Agent.

(a) Unless the Agent receives notice from a Bank on or
prior to the Closing Date or, with respect to any Borrowing after the Closing
Date, at least one Business Day prior to the date of such Borrowing, that such
Bank will not make available as and when required hereunder to the Agent for
the account of the Company the amount of that Bank's Pro Rata Share of the
Committed Borrowing, the Agent may assume that each Bank has made such amount
available to the Agent in

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<PAGE> 49

Same Day Funds on the Borrowing Date and the Agent may (but shall not be so
required), in reliance upon such assumption, make available to the Company on
such date a corresponding amount. If and to the extent any Bank shall not have
made its full amount available to the Agent in Same Day Funds and the Agent in
such circumstances has made available to the Company such amount, that Bank
shall on the Business Day following such Borrowing Date make such amount
available to the Agent, together with interest at the Federal Funds Rate or, in
the case of any Borrowing consisting of Offshore Currency Loans, the Overnight
Rate, for each day during such period. A notice of the Agent submitted to any
Bank with respect to amounts owing under this subsection 2.16(a) shall be
conclusive, absent manifest error. If such amount is so made available, such
payment to the Agent shall constitute such Bank's Loan on the date of Borrowing
for all purposes of this Agreement. If such amount is not made available to
the Agent on the Business Day following the Borrowing Date, the Agent will
notify the Company of such failure to fund and, upon demand by the Agent, the
Company shall pay such amount to the Agent for the Agent's account, together
with interest thereon for each day elapsed since the date of such Committed
Borrowing, at a rate per annum equal to the interest rate applicable at the
time to the Committed Loans comprising such Committed Borrowing.

(b) The failure of any Bank to make any Committed Loan on
any Borrowing Date shall not relieve any other Bank of any obligation hereunder
to make a Committed Loan on such Borrowing Date, but no Bank shall be
responsible for the failure of any other Bank to make the Committed Loan to be
made by such other Bank on any Borrowing Date.

2.17 Sharing of Payments, Etc. If, other than as expressly
provided elsewhere herein, any Bank shall obtain on account of the Committed
Loans made by it any payment (whether voluntary, involuntary, through the
exercise of any right of set-off, or otherwise) in excess of its ratable share
(or other share contemplated hereunder), such Bank shall immediately (a) notify
the Agent of such fact, and (b) purchase from the other Banks such
participations in the Committed Loans made by them as shall be necessary to
cause such purchasing Bank to share the excess payment pro rata with each of
them; provided, however, that if all or any portion of such excess payment is
thereafter recovered from the purchasing Bank, such purchase shall to that
extent be rescinded and each other Bank shall repay to the purchasing Bank the
purchase price paid therefor, together with an amount equal to such paying
Bank's ratable share (according to the proportion of (i) the amount of such
paying Bank's required repayment to (ii) the total amount so recovered from the
purchasing Bank) of any interest or other amount paid or payable by the
purchasing Bank in respect of the total amount so recovered. The Company
agrees that any Bank so purchasing a participation from another Bank may, to
the fullest extent permitted by law, exercise all its rights of payment
(including the right of set-off, but subject to Section 11.10) with respect to
such participation as fully as if such Bank were the direct creditor of the
Company in the amount of such participation. The Agent will keep records
(which shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section and will in each case notify the
Banks following any such purchases or repayments. Any Bank having outstanding
both Committed Loans and Bid Loans at any time a right of set-off is exercised
by such Bank and applying such setoff to the Loans shall apply the proceeds of
such set-off first to such Bank's Committed Loans, until its Committed Loans
are reduced to zero, and thereafter to its Bid Loans.

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<PAGE> 50

2.18 Effect of Amendment and Restatement. The Company, the Agent
and the Banks acknowledge and agree that (i) this Agreement and the documents
executed and delivered in connection herewith do not constitute a novation,
payment and reborrowing, or termination of the loan obligations, reimbursement
obligations or other monetary obligations under the Existing Credit Agreement
(the "Existing Obligations") as in effect prior to the Closing Date or a
novation, payment and reborrowing of the loan under the Existing Credit
Agreement as in effect prior to the Closing Date, (ii) the Existing Obligations
are in all respects enforceable with only the terms thereof being modified as
provided by this Agreement, (iii) the liens and security interests of the Agent
for the benefit of the Banks securing payment of the Existing Obligations are
in all respects continuing and in full force and effect with respect to the
Obligations hereunder and (iv) all references in the loan documents executed
and delivered in connection with the Existing Credit Agreement to the "Credit
Agreement" or the "Second Amended and Restated Credit Agreement" shall be
deemed to refer without further amendment to this Agreement.

ARTICLE III

THE LETTERS OF CREDIT

3.01 The Letter of Credit Subfacility.

(a) On the terms and conditions set forth herein (i) the
Issuing Bank agrees, (A) from time to time on any Business Day during the
period from the Closing Date to the Revolving Termination Date to issue Letters
of Credit denominated in Dollars or an Offshore L/C Currency for the account of
the Company, and to amend or renew Letters of Credit previously issued by it,
in accordance with subsections 3.02(c) and 3.02(d), and (B) to honor drafts
under the Letters of Credit; and (ii) the Banks severally agree to participate
in Letters of Credit Issued for the account of the Company; provided that the
Issuing Bank shall not be obligated to Issue, and no Bank shall be obligated to
participate in, any Letter of Credit if as of the date of Issuance of such
Letter of Credit (the "Issuance Date"): (1) the Effective Amount of all L/C
Obligations exceeds $25,000,000; (2) the Effective Amount of all L/C
Obligations plus the Effective Amount of all Loans exceeds the aggregate
Commitments or (3) the participation of any Bank in the Effective Amount of all
L/C Obligations plus the Effective Amount of the Committed Loans of such Bank
exceeds such Bank's Commitment. Within the foregoing limits, and subject to
the other terms and conditions hereof, the Company's ability to obtain Letters
of Credit shall be fully revolving, and, accordingly, the Company may, during
the foregoing period, obtain Letters of Credit to replace Letters of Credit
which have expired or which have been drawn upon and reimbursed.

(b) The Issuing Bank shall be under no obligation to
Issue any Letter of Credit if:

(i) any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms purport to
enjoin

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<PAGE> 51

or restrain the Issuing Bank from Issuing such Letter of
Credit, or any Requirement of Law applicable to the Issuing
Bank or any request or directive (whether or not having the
force of law) from any Governmental Authority with
jurisdiction over the Issuing Bank shall prohibit, or request
that the Issuing Bank refrain from, the Issuance of letters of
credit generally or such Letter of Credit in particular or
shall impose upon the Issuing Bank with respect to such Letter
of Credit any restriction, reserve or capital requirement (for
which the Issuing Bank is not otherwise compensated hereunder)
not in effect on the Closing Date, or shall impose upon the
Issuing Bank any unreimbursed loss, cost or expense which was
not applicable on the Closing Date and which the Issuing Bank
in good faith deems material to it and for which the Issuing
Bank is not compensated hereunder;

(ii) the Issuing Bank has received written notice
from any Bank, the Agent or the Company, on or prior to the
Business Day prior to the requested date of Issuance of such
Letter of Credit, that one or more of the applicable
conditions contained in Article V is not then satisfied;

(iii) the expiry date of any requested Letter of
Credit is after the scheduled Revolving Termination Date,
unless all of the Banks have approved such expiry date in
writing;

(iv) any requested Letter of Credit is not in form
and substance acceptable to the Issuing Bank, or the Issuance
of a Letter of Credit shall violate any applicable policies of
the Issuing Bank; or

(v) any standby Letter of Credit is for the
purpose of supporting the issuance of any letter of credit by
any other Person other than a guarantee issued by a foreign
bank.

3.02 Issuance, Amendment and Renewal of Letters of Credit.

(a) Each Letter of Credit shall be issued upon the
irrevocable written request of the Company received by the Issuing Bank (with a
copy sent by the Company to the Agent) at least two Business Days (or such
shorter time as the Issuing Bank may agree in a particular instance in its sole
discretion) prior to the proposed date of issuance. Each such request for
issuance of a Letter of Credit shall be by facsimile, confirmed immediately in
an original writing, in the form of an L/C Application, and shall specify in
form and detail reasonably satisfactory to the Issuing Bank: (i) the proposed
date of issuance of the Letter of Credit (which shall be a Business Day); (ii)
the face amount of the Letter of Credit; (iii) the expiry date of the Letter of
Credit; (iv) the name and address of the beneficiary thereof; (v) the documents
to be presented by the beneficiary of the Letter of Credit in case of any
drawing thereunder; (vi) the full text of any certificate to be presented by
the

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beneficiary in case of any drawing thereunder; (vii) the currency (which shall
be Dollars or an Offshore L/C Currency) in which the Letter of Credit is to be
denominated; and (viii) such other matters as the Issuing Bank may require.
The Agent will promptly notify the Banks of the receipt by it of any L/C
Application.

(b) If the Agent is not the Issuing Bank, by 12:00 p.m.
(Chicago time) on the Business Day next preceding the requested date of
issuance of a Letter of Credit, the Issuing Bank will confirm with the Agent
(by telephone or in writing) that the Agent has received a copy of the L/C
Application or L/C Amendment Application from the Company and, if not, the
Issuing Bank will provide the Agent with a copy thereof. Unless the Issuing
Bank has received notice on or before the Business Day immediately preceding
the date the Issuing Bank is to issue a requested Letter of Credit from the
Agent (i) directing the Issuing Bank not to issue such Letter of Credit because
such issuance is not then permitted under subsection 3.01(a) as a result of the
limitations set forth in clauses (1) through (3) thereof or subsection
3.01(b)(ii); or (ii) that one or more conditions specified in Article V are not
then satisfied; then, subject to the terms and conditions hereof, the Issuing
Bank shall, on the requested date, issue a Letter of Credit for the account of
the Company in accordance with the Issuing Bank's usual and customary business
practices.

(c) From time to time while a Letter of Credit is
outstanding and prior to the Revolving Termination Date, the Issuing Bank will,
upon the written request of the Company received by the Issuing Bank (with a
copy sent by the Company to the Agent) at least two Business Days (or such
shorter time as the Issuing Bank may agree in a particular instance in its sole
discretion) prior to the proposed date of amendment, amend any Letter of Credit
issued by it. Each such request for amendment of a Letter of Credit shall be
made by facsimile, confirmed immediately in an original writing, made in the
form of an L/C Amendment Application and shall specify in form and detail
satisfactory to the Issuing Bank: (i) the Letter of Credit to be amended; (ii)
the proposed date of amendment of the Letter of Credit (which shall be a
Business Day); (iii) the nature of the proposed amendment; and (iv) such other
matters as the Issuing Bank may reasonably require. The Issuing Bank shall be
under no obligation to amend any Letter of Credit if: (A) the Issuing Bank
would have no obligation at such time to issue such Letter of Credit in its
amended form under the terms of this Agreement; or (B) the beneficiary of any
such Letter of Credit does not accept the proposed amendment to the Letter of
Credit.

(d) The Issuing Bank and the Banks agree that, while a
Letter of Credit is outstanding and prior to the Revolving Termination Date, at
the option of the Company and upon the written request of the Company received
by the Issuing Bank (with a copy sent by the Company to the Agent) at least two
Business Days (or such shorter time as the Issuing Bank may agree in a
particular instance in its sole discretion) prior to the proposed date of
notification of renewal, the Issuing Bank shall be entitled to authorize the
automatic renewal of any Letter of Credit issued by it. Each such request for
renewal of a Letter of Credit shall be made by facsimile, confirmed immediately
in an original writing, in the form of an L/C Amendment Application, and shall
specify in form and detail satisfactory to the Issuing Bank: (i) the Letter of
Credit to be renewed; (ii) the proposed date of notification of renewal of the
Letter of Credit (which shall be a Business Day); (iii) the revised expiry date
of the Letter of Credit; and (iv) such other matters as the Issuing Bank may

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<PAGE> 53

require. The Issuing Bank shall be under no obligation to renew any Letter of
Credit if: (A) the Issuing Bank would have no obligation at such time to issue
or amend such Letter of Credit in its renewed form under the terms of this
Agreement; or (B) the beneficiary of any such Letter of Credit does not accept
the proposed renewal of the Letter of Credit. If any outstanding Letter of
Credit shall provide that it shall be automatically renewed unless the
beneficiary thereof receives notice from the Issuing Bank that such Letter of
Credit shall not be renewed, and if at the time of renewal the Issuing Bank
would be entitled to authorize the automatic renewal of such Letter of Credit
in accordance with this subsection 3.02(d) upon the request of the Company but
the Issuing Bank shall not have received any L/C Amendment Application from the
Company with respect to such renewal or other written direction by the Company
with respect thereto, the Issuing Bank shall nonetheless be permitted to allow
such Letter of Credit to renew, and the Company and the Banks hereby authorize
such renewal, and, accordingly, the Issuing Bank shall be deemed to have
received an L/C Amendment Application from the Company requesting such renewal.

(e) The Issuing Bank may, at its election (or as required
by the Agent at the direction of the Majority Banks), deliver any notices of
termination or other communications to any Letter of Credit beneficiary or
transferee, and take any other action as necessary or appropriate, at any time
and from time to time, in order to cause the expiry date of such Letter of
Credit to be a date not later than the Revolving Termination Date.

(f) This Agreement shall control in the event of any
conflict with any L/C-Related Document (other than any Letter of Credit). In
addition, unless the Company and the Issuing Bank shall otherwise expressly
agree in writing, any purported grant of a Lien (or any requirement to do so)
contained in any L/C Related Document shall be ineffective and null and void.

(g) The Issuing Bank will also deliver to the Agent,
concurrently or promptly following its delivery of a Letter of Credit, or
amendment to or renewal of a Letter of Credit, to an advising bank or a
beneficiary, a true and complete copy of each such Letter of Credit or
amendment to or renewal of a Letter of Credit.

3.03 Risk Participations, Drawings and Reimbursements.

(a) Immediately upon the Issuance of each Letter of
Credit, each Bank shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Issuing Bank a participation in
such Letter of Credit and each drawing thereunder in an amount equal to the
product of (i) the Pro Rata Share of such Bank, times (ii) the maximum amount
available to be drawn under such Letter of Credit and the amount of such
drawing, respectively. For purposes of Section 2.01, each Issuance of a Letter
of Credit shall be deemed to utilize the Commitment of each Bank by an amount
equal to the amount of such participation for so long as any related L/C
Obligations shall be outstanding.

(b) In the event of any request for a drawing under a
Letter of Credit by the beneficiary or transferee thereof, the Issuing Bank
will promptly notify the Company and the Agent. Provided it shall have
received such notice, the Company shall reimburse the Issuing Bank prior to

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<PAGE> 54

12:00 p.m. (Chicago time) on each date that any amount is paid by the Issuing
Bank under any Letter of Credit (each such date, an "Honor Date") in an amount
equal to the amount so paid by the Issuing Bank; provided that, if such Letter
of Credit is denominated in an Offshore L/C Currency, the Company shall pay to
the Issuing Bank the Dollar Equivalent of the amount of such Offshore L/C
Currency paid by the Issuing Bank under such Letter of Credit. In the event
the Company fails to reimburse the Issuing Bank for the full amount of any
drawing under any Letter of Credit by 12:00 p.m. (Chicago time) on the Honor
Date, the Issuing Bank will promptly notify the Agent and the Agent will
promptly notify each Bank thereof, and the Company shall be deemed to have
requested that Base Rate Loans be made by the Banks to be disbursed on the
Honor Date under such Letter of Credit, subject to the amount of the unutilized
portion of the Commitment and subject to the conditions set forth in Section
5.02 other than any notice requirements. Any notice given by the Issuing Bank
or the Agent pursuant to this subsection 3.03(b) may be oral if immediately
confirmed in writing (including by facsimile); provided that the lack of such
an immediate confirmation shall not affect the conclusiveness or binding effect
of such notice.

(c) Each Bank shall upon any notice pursuant to
subsection 3.03(b) make available to the Agent for the account of the relevant
Issuing Bank an amount in Dollars and in immediately available funds equal to
its Pro Rata Share of the amount of the Dollar Equivalent of the drawing,
whereupon the participating Banks shall (subject to subsection 3.03(d)) each be
deemed to have made a Loan consisting of a Base Rate Loan to the Company in
that amount. If any Bank so notified fails to make available to the Agent for
the account of the Issuing Bank the amount of such Bank's Pro Rata Share of
such amount by no later than 2:00 p.m. (Chicago time) on the Honor Date, then
interest shall accrue on such Bank's obligation to make such payment, from the
Honor Date to the date such Bank makes such payment, at a rate per annum equal
to the Federal Funds Rate in effect from time to time during such period. The
Agent will promptly give notice of the occurrence of the Honor Date, but
failure of the Agent to give any such notice on the Honor Date or in sufficient
time to enable any Bank to effect such payment on such date shall not relieve
such Bank from its obligations under this Section 3.03.

(d) With respect to any unreimbursed drawing that is not
converted into Loans consisting of Base Rate Loans to the Company in whole or
in part as contemplated by Section 3.03(b), because of the Company's failure to
satisfy the conditions set forth in Section 5.02 or for any other reason, the
Company shall be deemed to have incurred from the Issuing Bank an L/C Borrowing
in the amount of such drawing, which L/C Borrowing shall be due and payable on
demand (together with interest) and shall bear interest at a rate per annum
equal to the Base Rate, and each Bank's payment to the Issuing Bank pursuant to
subsection 3.03(c) shall be deemed payment in respect of its participation in
such L/C Borrowing and shall constitute an L/C Advance from such Bank in
satisfaction of its participation obligation under this Section 3.03.

(e) Each Bank's obligation in accordance with this
Agreement to make the Loans or L/C Advances, as contemplated by this Section
3.03, as a result of a drawing under a Letter of Credit, shall be absolute and
unconditional and without recourse to the Issuing Bank and shall not be
affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Bank may have against the Issuing
Bank, the Company or any other Person

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<PAGE> 55

for any reason whatsoever; (ii) the occurrence or continuance of a Default, an
Event of Default or a Material Adverse Effect; or (iii) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing;
provided, however, that each Bank's obligation to make Loans under this
Section 3.03 is subject to the conditions set forth in Section 5.02 (other than
any notice requirements).

3.04 Repayment of Participations.

(a) Upon (and only upon) receipt by the Agent for the
account of the Issuing Bank of immediately available funds from the Company (i)
in reimbursement of any payment made by the Issuing Bank under the Letter of
Credit with respect to which any Bank has paid the Agent for the account of the
Issuing Bank for such Bank's participation in the Letter of Credit pursuant to
Section 3.03 or (ii) in payment of interest thereon, the Agent will pay to each
Bank, in the same funds as those received by the Agent for the account of the
Issuing Bank, the amount of such Bank's Pro Rata Share of such funds, and the
Issuing Bank shall receive the amount of the Pro Rata Share of such funds of
any Bank that did not so pay the Agent for the account of the Issuing Bank.

(b) If the Agent or the Issuing Bank is required at any
time to return to the Company, or to a trustee, receiver, liquidator,
custodian, or any official in any Insolvency Proceeding, any portion of the
payments made by the Company to the Agent for the account of the Issuing Bank
pursuant to subsection 3.04(a) in reimbursement of a payment made under the
Letter of Credit or interest or fee thereon, each Bank shall, on demand of the
Agent, forthwith return to the Agent or the Issuing Bank the amount of its Pro
Rata Share of any amounts so returned by the Agent or the Issuing Bank plus
interest thereon from the date such demand is made to the date such amounts are
returned by such Bank to the Agent or the Issuing Bank, at a rate per annum
equal to the Federal Funds Rate in effect from time to time.

3.05 Role of the Issuing Bank.

(a) Each Bank and the Company agree that, in paying any
drawing under a Letter of Credit, the Issuing Bank shall not have any
responsibility to obtain any document (other than any sight draft and
certificates expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document.

(b) No Agent-Related Person nor any of the respective
correspondents, participants or assignees of the Issuing Bank shall be liable
to any Bank for: (i) any action taken or omitted in connection herewith at the
request or with the approval of the Banks (including the Majority Banks, as
applicable); (ii) any action taken or omitted in the absence of gross
negligence or willful misconduct; or (iii) the due execution, effectiveness,
validity or enforceability of any L/C-Related Document.

(c) The Company hereby assumes all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any
Letter of Credit; provided, however, that this

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<PAGE> 56
assumption is not intended to, and shall not, preclude the Company's pursuing
such rights and remedies as it may have against the beneficiary or transferee
at law or under any other agreement. No Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the Issuing Bank, shall
be liable or responsible for any of the matters described in clauses (a)
through (g) of Section 3.06; provided, however, anything in such clauses to the
contrary notwithstanding, that the Company may have a claim against the Issuing
Bank, and the Issuing Bank may be liable to the Company, to the extent, but
only to the extent, of any direct, as opposed to consequential or exemplary,
damages suffered by the Company which the Company proves were caused by the
Issuing Bank's willful misconduct or gross negligence or the Issuing Bank's
willful misconduct or gross negligence or the Issuing Bank's wrongful dishonor
of any Letter of Credit after the presentation to it by the beneficiary of a
sight draft and certificate(s) strictly complying with the terms and conditions
of a Letter of Credit. In furtherance and not in limitation of the foregoing:
(i) the Issuing Bank may accept documents that appear on their face to be in
order, without responsibility for further investigation; and (ii) the Issuing
Bank shall not be responsible for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign a Letter of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason.

3.06 Obligations Absolute. The obligations of the Company under
this Agreement and any L/C-Related Document to reimburse the Issuing Bank for a
drawing under a Letter of Credit, and to repay any L/C Borrowing and any
drawing under a Letter of Credit converted into Loans, shall be unconditional
and irrevocable, and shall be paid strictly in accordance with the terms of
this Agreement and each such other L/C-Related Document under all
circumstances, including the following:

(a) any lack of validity or enforceability of this
Agreement or any L/C-Related Document;

(b) any change in the time, manner or place of payment
of, or in any other term of, all or any of the obligations of the Company in
respect of any Letter of Credit or any other amendment or waiver of or any
consent to departure from all or any of the L/C-Related Documents;

(c) the existence of any claim, set-off, defense or other
right that the Company may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Person for whom any such beneficiary
or any such transferee may be acting), the Issuing Bank or any other Person,
whether in connection with this Agreement, the transactions contemplated hereby
or by the L/C-Related Documents or any unrelated transaction;

(d) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent, invalid
or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect; or any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any Letter
of Credit;

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<PAGE> 57

(e) any payment by the Issuing Bank under any Letter of
Credit against presentation of a draft or certificate that does not strictly
comply with the terms of any Letter of Credit; or any payment made by the
Issuing Bank under any Letter of Credit to any Person purporting to be a
trustee in bankruptcy, debtor-in-possession, assignee for the benefit of
creditors, liquidator, receiver or other representative of or successor to any
beneficiary or any transferee of any Letter of Credit, including any arising in
connection with any Insolvency Proceeding;

(f) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to departure
from any other guarantee, for all or any of the obligations of the Company in
respect of any Letter of Credit; or

(g) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, the Company or a guarantor.

3.07 Letter of Credit Fees.

(a) The Company shall pay to the Agent for the account of
each of the Banks a letter of credit fee with respect to standby Letters of
Credit equal to the Applicable Margin times the average daily maximum amount
available to be drawn on such outstanding Letters of Credit and with respect to
commercial Letters of Credit, a $75.00 fronting fee (for the account of the
Issuer) plus a .25% exposure fee, in each case, computed on a quarterly basis
in arrears on the last Business Day of each calendar quarter based upon Letters
of Credit of such type outstanding for that quarter as calculated by the Agent.
Such letter of credit fees shall be due and payable quarterly in arrears on the
last Business Day of each calendar quarter during which Letters of Credit are
outstanding, commencing on the first such quarterly date to occur after the
Closing Date, through the Revolving Termination Date (or such later date upon
which the outstanding Letters of Credit shall expire), with the final payment
to be made on the Revolving Termination Date (or such later expiration date).

(b) The Company shall pay to the Issuing Bank a letter of
credit fronting fee for each Letter of Credit Issued by the Issuing Bank in an
amount agreed to by the Company and the Issuing Bank. Such Letter of Credit
fronting fee shall be due and payable on each date of Issuance of a Letter of
Credit or at such other time as may be agreed upon between the Company and the
Issuing Bank.

(c) The Company shall pay to the Issuing Bank from time
to time on demand the normal issuance, presentation, amendment and other
processing fees, and other standard costs and charges, of the Issuing Bank
relating to letters of credit as from time to time in effect.

3.08 Uniform Customs and Practice. The Uniform Customs and
Practice for Documentary Credits as published by the International Chamber of
Commerce most recently at the time of issuance of any Letter of Credit shall
(unless otherwise expressly provided in the Letters of Credit) apply to the
Letters of Credit.

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3.09 Outstanding Letters of Credit. The letters of credit set
forth under the caption "Letters of Credit outstanding on the Original Closing
Date" on Schedule 3.09 annexed hereto and made a part hereof were issued
pursuant to the Original Credit Agreement and remain outstanding as of the
Closing Date (the "Outstanding Letters of Credit"). The Company, each
Issuing Bank and each of the Banks hereby agree with respect to the Outstanding
Letters of Credit that such Outstanding Letters of Credit, for all purposes
under this Agreement shall be deemed to be Letters of Credit governed by the
terms and conditions of this Agreement. Each Bank agrees to participate in
each Outstanding Letter of Credit issued by any Issuing Bank in an amount equal
to its Pro Rata Share of the stated amount of such Outstanding Letter of
Credit.

ARTICLE IV

TAXES, YIELD PROTECTION AND ILLEGALITY

4.01 Taxes.

(a) Any and all payments by the Company to each Bank or
the Agent under this Agreement and any other Loan Document shall be made free
and clear of, and without deduction or withholding for, any Taxes. In
addition, the Company shall pay all Other Taxes.

(b) If the Company shall be required by law to deduct or
withhold any Taxes, Other Taxes or Further Taxes from or in respect of any sum
payable hereunder to any Bank or the Agent, then:

(i) the sum payable shall be increased as necessary so
that, after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable
under this Section 4.01), such Bank or the Agent, as the case may be,
receives and retains an amount equal to the sum it would have received
and retained had no such deductions or withholdings been made;

(ii) the Company shall make such deductions and
withholdings;

(iii) the Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law; and

(iv) the Company shall also pay to each Bank or the Agent
for the account of such Bank, at the time interest is paid, Further
Taxes in the amount that the respective Bank specifies as necessary to
preserve the after-tax yield the Bank would have received if such
Taxes, Other Taxes or Further Taxes had not been imposed.

(c) The Company agrees to indemnify and hold harmless
each Bank and the Agent for the full amount of (i) Taxes, (ii) Other Taxes, and
(iii) Further Taxes in the amount that the respective Bank specifies as
necessary to preserve the after-tax yield the Bank would have received if such
Taxes, Other Taxes or Further Taxes had not been imposed, and any liability

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(including penalties, interest, additions to tax and expenses) arising
therefrom or with respect thereto, whether or not such Taxes, Other Taxes or
Further Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days after the date the Bank or the
Agent makes written demand therefor.

(d) Within 30 days after the date of any payment by the
Company of Taxes, Other Taxes or Further Taxes, the Company shall furnish to
each Bank or the Agent the original or a certified copy of a receipt evidencing
payment thereof, or other evidence of payment satisfactory to such Bank or the
Agent.

(e) If the Company is required to pay any amount to any
Bank or the Agent pursuant to subsection (b) or (c) of this Section 4.01, then
such Bank shall use reasonable efforts (consistent with legal and regulatory
restrictions) to change the jurisdiction of its Lending Office so as to
eliminate any such additional payment by the Company which may thereafter
accrue, if such change in the sole judgment of such Bank is not otherwise
disadvantageous to such Bank.

(f) Notwithstanding anything to the contrary contained in
this Agreement, in no event shall the Company be either (i) obligated to pay
any amount to any Bank or the Agent pursuant to subsection (b) or (c) of this
Section 4.01 or (ii) prohibited from deducting or withholding for any
applicable Taxes pursuant to subsection (a) of this Section 4.01, if the Bank
or Agent fails to deliver forms to the Company in accordance with Section 10.10
on a timely basis, unless such failure would not have occurred but for a change
in law or regulation or in the interpretation thereof by any governmental or
regulatory agency or body charged with the administration or interpretation
thereof, or the introduction of any law or regulation, that occurs on or after
the date hereof.

4.02 Illegality.

(a) If any Bank determines that the introduction of any
Requirement of Law, or any change in any Requirement of Law, or in the
interpretation or administration of any Requirement of Law, has made it
unlawful, or that any central bank or other Governmental Authority has asserted
that it is unlawful, for any Bank or its applicable Lending Office or such
Bank's Designated Bidders in the case of LIBOR Bid Loans, to make Offshore Rate
Loans (including Offshore Rate Loans in any Applicable Currency), then, on
notice thereof by the Bank to the Company through the Agent, any obligation of
that Bank or Designated Bidder to make Offshore Rate Loans (including in
respect of any LIBOR Bid Loan as to which the Company has accepted such Bank's
or Designated Bidder's Competitive Bid, but as to which the Borrowing Date has
not arrived) shall be suspended until the Bank notifies the Agent and the
Company that the circumstances giving rise to such determination no longer
exist.

(b) If a Bank determines that it is unlawful for such
Bank or such Bank's Designated Bidders to maintain any Offshore Rate Loan, the
Company shall, upon its receipt of notice of such fact and demand from such
Bank (with a copy to the Agent), prepay in full such Offshore Rate Loans of
that Bank then outstanding, together with interest accrued thereon and amounts
required under Section 4.04, either on the last day of the Interest Period
thereof, if the Bank

<PAGE> 60

or Designated Bidder may lawfully continue to maintain such Offshore Rate Loans
to such day, or immediately, if the Bank or Designated Bidder may not lawfully
continue to maintain such Offshore Rate Loan. If the Company is required to so
prepay any Offshore Rate Loan, then concurrently with such prepayment, the
Company shall (without regard to whether the conditions specified in Section
5.02 have been satisfied) borrow from the affected Bank, in the amount of such
repayment, a Base Rate Committed Loan.

(c) If the obligation of any Bank to make or maintain
Offshore Rate Committed Loans has been so terminated or suspended, the Company
may elect, by giving notice to the Bank through the Agent that all Loans which
would otherwise be made by the Bank as Offshore Rate Committed Loans shall be
instead Base Rate Loans.

(d) Before giving any notice to the Agent under this
Section, the affected Bank shall designate a different Lending Office with
respect to its Offshore Rate Loans if such designation will avoid the need for
giving such notice or making such demand and will not, in the judgment of the
Bank, be illegal or otherwise disadvantageous to the Bank.

4.03 Increased Costs and Reduction of Return.

(a) If any Bank determines that, due to either (i) the
introduction of or any change (other than any change by way of imposition of or
increase in reserve requirements included in the calculation of the Offshore
Rate or in respect of the assessment rate payable by any Bank to the FDIC for
insuring U.S. deposits) in or in the interpretation of any law or regulation
after the date of this Agreement or (ii) the compliance by that Bank with any
guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law) after the date of this Agreement,
there shall be any increase in the cost to such Bank of agreeing to make or
making, funding or maintaining any Offshore Rate Committed Loans or
participating in Letters of Credit, or, in the case of the Issuing Bank, any
increase in the cost to the Issuing Bank of agreeing to issue, issuing or
maintaining any Letter of Credit or of agreeing to make or making, funding or
maintaining any unpaid drawing under any Letter of Credit, then the Company
shall be liable for, and shall from time to time, upon demand (with a copy of
such demand to be sent to the Agent), pay to the Agent for the account of such
Bank, additional amounts as are sufficient to compensate such Bank for such
increased costs.

(b) If any Bank shall have determined that (i) the
introduction of any Capital Adequacy Regulation, (ii) any change in any Capital
Adequacy Regulation, (iii) any change in the interpretation or administration
of any Capital Adequacy Regulation by any central bank or other Governmental
Authority charged with the interpretation or administration thereof, or (iv)
compliance by the Bank (or its Lending Office) or any corporation controlling
the Bank with any Capital Adequacy Regulation, in any such case, after the date
of this Agreement, affects or would affect the amount of capital required or
expected to be maintained by the Bank or any corporation controlling the Bank
and (taking into consideration such Bank's or such corporation's policies with
respect to capital adequacy and such Bank's desired return on capital)
determines that the amount of such capital is increased as a consequence of its
Commitment[s], loans, credits or obligations

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under this Agreement, then, upon demand of such Bank to the Company through the
Agent, the Company shall pay to the Bank, from time to time as specified by the
Bank, additional amounts sufficient to compensate the Bank for such increase.

4.04 Funding Losses. The Company shall reimburse each Bank and
hold each Bank harmless from any loss or expense which the Bank may sustain or
incur as a consequence of:

(a) the failure of the Company to make on a timely basis
any payment of principal of any Offshore Rate Loan;

(b) the failure of the Company to borrow, continue or
convert a Committed Loan after the Company has given (or is deemed to have
given) a Notice of Borrowing or a Notice of Conversion/ Continuation, except as
set forth in subsections 2.05(b) or (c);

(d) the prepayment (including pursuant to Section 2.09 or
2.10) or other payment (including after acceleration thereof) of an Offshore
Rate Loan on a day that is not the last day of the relevant Interest Period; or

(e) the automatic conversion under Section 2.04 of any
Offshore Rate Committed Loan to a Base Rate Committed Loan on a day that is not
the last day of the relevant Interest Period;

including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Committed Loans or from
fees payable to terminate the deposits from which such funds were obtained or
from charges relating to any Offshore Currency Loans. For purposes of
calculating amounts payable by the Company to the Banks under this Section and
under subsection 4.03(a), each Offshore Rate Committed Loan made by a Bank (and
each related reserve, special deposit or similar requirement) shall be
conclusively deemed to have been funded at the IBOR used in determining the
Offshore Rate for such Offshore Rate Loan by a matching deposit or other
borrowing in the interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Offshore Rate Loan is in fact so funded.

4.05 Inability to Determine Rates. If the Agent determines that
for any reason adequate and reasonable means do not exist for determining the
Offshore Rate for any requested Interest Period with respect to a proposed
Offshore Rate Loan, or the Majority Banks that the Offshore Rate applicable
pursuant to subsection 2.12(a) for any requested Interest Period with respect
to a proposed Offshore Rate Loan does not adequately and fairly reflect the
cost to the Banks of funding such Loan, the Agent will promptly so notify the
Company and each Bank. Thereafter, the obligation of the Banks to make or
maintain Offshore Rate Loans, as the case may be, hereunder shall be suspended
until the Agent revokes such notice in writing. Upon receipt of such notice,
the Company may revoke any Notice of Borrowing or Notice of
Conversion/Continuation then submitted by it. If the Company does not revoke
such Notice, the Banks shall make, convert or

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continue the Committed Loans, as proposed by the Company, in the amount
specified in the applicable notice submitted by the Company, but such Loans
shall be made, converted or continued as Base Rate Committed Loans instead of
Offshore Rate Loans. In the case of any Offshore Currency Loans, the Borrowing
or continuation shall be in an aggregate amount equal to the Dollar Equivalent
amount of the originally requested Borrowing or continuation in the Offshore
Currency, and to that end any outstanding Offshore Currency Loans which are the
subject of any continuation shall be redenominated and converted into Base Rate
Loans in Dollars with effect from the last day of the Interest Period with
respect to any such Offshore Currency Loans.

4.06 Reserves on Offshore Rate Loans. The Company shall pay to
each Bank, as long as such Bank shall be required under regulations of the FRB
to maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities"), and, in respect of any LIBOR Bid Loan, under any applicable
regulations of the central bank or other relevant Governmental Authority in the
country in which the Offshore Currency of such Offshore Rate Committed Loan
circulates, additional costs on the unpaid principal amount of each LIBOR Bid
Loan equal to the actual costs of such reserves allocated to such Loan by the
Bank (as determined by the Bank in good faith, which determination shall be
conclusive), payable on each date on which interest is payable on such LIBOR
Bid Loan, provided the Company shall have received at least 15 days' prior
written notice (with a copy to the Agent) of such additional interest from the
Bank. If a Bank fails to give notice 15 days prior to the relevant Interest
Payment Date, such additional interest shall be payable 15 days from receipt of
such notice.

4.07 Certificates of Banks. Any Bank or Designated Bidder claiming
reimbursement or compensation under this Article IV shall deliver to the
Company (with a copy to the Agent) a certificate setting forth in reasonable
detail the amount payable to the Bank or Designated Bidder hereunder and such
certificate shall be conclusive and binding on the Company in the absence of
manifest error. Notwithstanding anything to the contrary contained in this
Agreement, no amounts shall be payable by the Company pursuant to Section 4.03,
4.04 or 4.06 with respect to any period commencing more than 90 days before the
delivery of the certificate contemplated by this Section 4.07, unless such
amounts are claimed as a result of the retroactive effect of any newly enacted
or adopted law, rule or regulation and such certificate is delivered within 180
days after such enactment or adoption.

4.08 Substitution of Banks. If any Bank has (x) delivered a
certificate pursuant to Section 4.07 or notified the Agent that it is unable to
extend or maintain any Offshore Rate Loans (including Offshore Currency Loans)
or (y) failed to fund a Loan at any time that such Bank shall have been
committed to make such Loan or in the event such Bank may be replaced pursuant
to the provisions of Section 11.08(e) hereof (in any such case, an "Affected
Bank"), the Company shall have the right to replace the Affected Bank in
accordance with this Section 4.08. In any such event the Company may (i)
request the Affected Bank to use its best efforts to obtain a replacement bank
or financial institution satisfactory to the Company to acquire and assume all
or a ratable part of all of such Affected Bank's Loans and Commitment (a
"Replacement Bank"); (ii) request one more of the other Banks to acquire and
assume all or part of such Affected Bank's Loans and Commitment; or (iii)
designate a Replacement Bank. Any such designation of a Replacement Bank under
clause (i) or

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(iii) shall be subject to the prior written consent of the Agent (which consent
shall not be unreasonably withheld).

4.09 Survival. The agreements and obligations of the Company in
this Article IV shall survive the payment of all other Obligations.

ARTICLE V

CONDITIONS PRECEDENT

5.01 Conditions of Initial Loans. The obligation of each Bank to
make its initial Credit Extension hereunder, and to receive through the Agent
the initial Competitive Bid Request, is subject to the condition that the Agent
shall have received on or before the date of the initial Credit Extension or
Competitive Bid Request all of the following, in form and substance
satisfactory to the Agent and each Bank, and in sufficient copies for each
Bank:

(a) Loan Documents. This Agreement, the Notes, the
Subsidiary Guaranty Agreement and the Pledge Agreement executed by each party
thereto and shall have delivered to Agent all the Pledged Stock and Pledged
Notes referred to therein then owned, if any, by the Company, (x) endorsed in
blank in the case of promissory notes constituting Pledged Notes and (y)
together with executed and undated stock powers, in the case of capital stock
constituting Pledged Stock and the other documents and instruments required to
be delivered under the Pledge Agreement;

(b) Resolutions; Incumbency.

(i) Copies of the resolutions of the board of directors of
the Company and each Subsidiary that may become party to a Loan
Document authorizing the transactions contemplated hereby, certified
as of the Closing Date by the Secretary or an Assistant Secretary of
such Person; and

(ii) A certificate of the Secretary or Assistant Secretary of
the Company, and each Subsidiary that may become party to a Loan
Document certifying the names and true signatures of the officers of
the Company or such Subsidiary authorized to execute, deliver and
perform, as applicable, this Agreement, and all other Loan Documents
to be delivered by it hereunder;

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(i) the articles or certificate of incorporation and the
bylaws of the Company and each Subsidiary party to any Loan Document
as in effect on the Closing Date, certified by the Secretary or
Assistant Secretary of the Company or such Subsidiary as of the
Closing Date; and

(ii) a good standing certificate for the Company and each
Subsidiary party to any Loan Document from the Secretary of State (or
similar, applicable Governmental Authority) of its state of
incorporation and the state of its principal place of business as of a
recent date;

(d) Legal Opinions. An opinion of Latham and Watkins,
special counsel to the Company and addressed to the Agent and the Banks,
substantially in the form of Exhibit 5.01(d);

(e) Payment of Fees. Evidence of payment by the Company
of all accrued and unpaid fees, to the extent then due and payable on the
Closing Date, including without limitation all accrued interest and fees due
and owing under the Original Credit Agreement;

(f) Certificate. A certificate signed by a Responsible
Officer on behalf of the Company, dated as of the Closing Date, stating that:

(i) the representations and warranties contained in
Article VI are true and correct on and as of such date, as though
made on and as of such date;

(ii) no Default or Event of Default exists or would result
from the initial Borrowing; and

(iii) there has occurred since December 31, 1995, no event
or circumstance that has resulted or could reasonably be expected to
result in a Material Adverse Effect; and

(g) Other Documents. Such other approvals, opinions,
documents or materials as the Agent or any Bank may reasonably request.

5.02 Conditions to All Credit Extensions. The obligation of each
Bank to make any Loan to be made by it (including its initial Loan), the
obligations of any Bank or Designated Bidder to make any Bid Loan as to which
the Company has accepted the relevant Competitive Bid and the obligation of the
Issuing Bank to issue, and of each Bank to participate in, any Letter of Credit
are subject to the satisfaction of the following conditions precedent on the
relevant Borrowing Date:

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(a) Notice of Borrowing or Issuance. The Agent shall have
received (with, in the case of the initial Loan only, a copy for each Bank) a
Notice of Borrowing or in the case of any Issuance of any Letter of Credit, the
Agent and the Issuing Bank shall have received an L/C Application or L/C
Amendment Application, as required under Section 3.02;

(b) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct on and
as of such Borrowing Date with the same effect as if made on and as of such
Borrowing Date (except to the extent such representations and warranties
expressly refer to an earlier date, in which case they shall be true and
correct as of such earlier date); and

Each Notice of Borrowing and L/C Application or L/C Amendment Application
submitted by the Company hereunder shall constitute a representation and
warranty by the Company hereunder, as of the date of each such notice and as of
each Borrowing Date, that the conditions in Section 5.02 are satisfied.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

The Company represents and warrants to the Agent and each Bank that:

6.01 Corporate Existence and Power. The Company and each of its
Subsidiaries:

(a) is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation;

(b) has the power and authority and all governmental
licenses, authorizations, consents and approvals to own its assets, carry on
its business and to execute, deliver, and perform its obligations under the
Loan Documents;

(c) is duly qualified as a foreign corporation and is
licensed and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification or license; and

(d) is in compliance with all Requirements of Law;

except, in each case referred to in clause (c) or clause (d), to the extent
that the failure to do so could not reasonably be expected to have a Material
Adverse Effect.

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6.02 Corporate Authorization; No Contravention. The execution,
delivery and performance by the Company and its Subsidiaries of this Agreement
and each other Loan Document to which such Person is party, have been duly
authorized by all necessary corporate action, and do not and will not:

(a) contravene the terms of any of that Person's
Organization Documents;

(b) conflict with or result in any breach or
contravention of, or the creation of any Lien under, any document evidencing
any material Contractual Obligation to which such Person is a party or any
order, injunction, writ or decree of any Governmental Authority to which such
Person or its property is subject; or

6.03 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, the Company or
any of its Subsidiaries of the Agreement or any other Loan Document other than
those which have already been obtained or made.

6.04 Binding Effect. This Agreement and each other Loan Document
to which the Company or any of its Subsidiaries is a party constitute the
legal, valid and binding obligations of the Company and any of its Subsidiaries
to the extent it is a party thereto, enforceable against such Person in
accordance with their respective terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, or similar laws affecting the enforcement
of creditors' rights generally or by equitable principles relating to
enforceability.

6.05 Litigation. Except as specifically disclosed in Schedule
6.05, there are no actions, suits, proceedings, claims or disputes pending, or
to the best knowledge of the Company, threatened or contemplated, at law, in
equity, in arbitration or before any Governmental Authority, against the
Company, or its Subsidiaries or any of their respective properties which:

(a) purport to affect or pertain to this Agreement or any
other Loan Document, or any of the transactions contemplated hereby or thereby;
or

(b) may reasonably be expected to have a Material Adverse
Effect. No injunction, writ, temporary restraining order or any order of any
nature has been issued by any court or other Governmental Authority purporting
to enjoin or restrain the execution, delivery or performance of this Agreement
or any other Loan Document, or directing that the transactions provided for
herein or therein not be consummated as herein or therein provided.

6.06 No Default. No Default or Event of Default exists or would
result from the incurring of any Obligations by the Company. As of the Closing
Date, neither the Company nor any Subsidiary is in default under or with
respect to any Contractual Obligation in any respect which,

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individually or together with all such defaults, could reasonably be expected
to have a Material Adverse Effect, or that would, if such default had occurred
after the Closing Date, create an Event of Default under subsection 9.01(e).

6.07 ERISA Compliance. Except as specifically disclosed in
Schedule 6.07:

(a) Each Plan sponsored or maintained by the Company or
an ERISA Affiliate is in compliance in all respects with the applicable
provisions of ERISA, the Code and other federal or state law except where the
failure to so comply, together with all other such failures to comply, could
reasonably be expected to result in liability to the Company in an aggregate
amount in excess of $5,000,000 . Each Plan sponsored or maintained by the
Company or an ERISA Affiliate which is intended to qualify under Section 401(a)
of the Code has received a favorable determination letter from the IRS and to
the best knowledge of the Company, nothing has occurred which would cause the
loss of such qualification. The Company and each ERISA Affiliate has made all
required contributions to any Plan subject to Section 412 of the Code sponsored
or maintained by the Company or an ERISA Affiliate, and no application for a
funding waiver or an extension of any amortization period pursuant to Section
412 of the Code has been made with respect to any Plan sponsored or maintained
by the Company or an ERISA Affiliate, except where the failure to make such
required contribution, together with all such other failures to make required
contributions, could reasonably be expected to result in liability of the
Company in an aggregate amount in excess of $5,000,000.

(b) There are no pending or, to the best knowledge of
Company, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan sponsored or maintained by the Company
which has resulted or could reasonably be expected to result in a liability of
the Company in an aggregate amount in excess of $5,000,000. There has been no
prohibited transaction or violation of the fiduciary responsibility rules with
respect to any Plan, other than a Multiemployer Plan or, to the knowledge of
the Company and each ERISA Affiliate, with respect to any Multiemployer Plan,
which has resulted or could reasonably be expected to result in a Material
Adverse Effect.

(c) (i) No ERISA Event or Events have occurred which
could reasonably be expected to result in liability of the Company in an
aggregate amount in excess of $5,000,000; (ii) the aggregate amount of Unfunded
Pension Liability among all Pension Plans does not exceed $5,000,000; (iii)
neither the Company nor any ERISA Affiliate has incurred, or reasonably expects
to incur, liability under Title IV of ERISA with respect to all Pension Plans
(other than premiums due and not delinquent under Section 4007 of ERISA) in an
aggregate amount in excess of $5,000,000; (iv) neither the Company nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any liability
(and no event has occurred which, with the giving of notice under Section 4219
of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA
with respect to a all Plans in an aggregate amount in excess of $5,000,000; and
(v) neither the Company nor any ERISA Affiliate has engaged in a transaction
that could be subject to Section 4069 or 4212(c) of ERISA and which could
reasonably be expected to result in liability of the Company in an amount in
excess of $5,000,000.

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6.08 Use of Proceeds; Margin Regulations. The proceeds of the
Loans are to be used solely for the purposes set forth in and permitted by
Section 7.12. Neither the Company nor any Subsidiary is generally engaged in
the business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock.

6.09 Title to Properties. The Company and each Subsidiary have
good record and marketable title in fee simple to, or valid leasehold interests
in, all real property necessary or used in the ordinary conduct of their
respective businesses, except for such defects in title as could not,
individually or in the aggregate, have a Material Adverse Effect. As of the
Closing Date, the property of the Company and its Subsidiaries is subject to no
Liens, other than Permitted Liens.

6.10 Taxes. The Company and its Subsidiaries have filed all
Federal and other material tax returns and reports required to be filed, and
have paid all Federal and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in
good faith by appropriate proceedings and for which adequate reserves have been
provided in accordance with GAAP. There is no proposed tax assessment against
the Company or any Subsidiary that would, if made, have a Material Adverse
Effect.

6.11 Financial Condition.

(a) The unaudited consolidated financial statements of
the Company and its Subsidiaries dated March 31, 1996, and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for the fiscal quarter ended on that date:

(i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise
expressly noted therein, subject to ordinary, good faith year end
audit adjustments and the absence of footnotes;

(ii) fairly present the financial condition of the Company
and its Subsidiaries as of the date thereof and results of operations
for the period covered thereby; and

(iii) except as specifically disclosed in Schedule 6.11,
show all material indebtedness and other liabilities, direct or
contingent, of the Company and its consolidated Subsidiaries as of
the date thereof, including liabilities for taxes, material
commitments and Contingent Obligations.

(b) Since March 31, 1996, there has been no Material
Adverse Effect.

6.12 Environmental Matters. Except as specifically disclosed in
Schedule 6.12, the Company is not in violation of any Environmental Laws and
there are no pending Environmental

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Claims against the Company which, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect.

6.13 Regulated Entities. None of the Company, any Person
controlling the Company, or any Subsidiary, is an "Investment Company" within
the meaning of the Investment Company Act of 1940. The Company is not subject
to regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act, any state public utilities code, or any
other Federal or state statute or regulation limiting its ability to incur
Indebtedness.

6.14 Subsidiaries. As of the date of this Agreement, the Company
has no Subsidiaries other than those specifically disclosed in part (a) of
Schedule 6.14 hereto and has no equity investments in any other corporation or
entity other than those specifically disclosed in part (b) of Schedule 6.14.
Unless otherwise indicated on Schedule 6.14, as of the date of this Agreement,
all of the issued and outstanding shares of capital stock of each of the
Subsidiaries listed on Schedule 6.14 are owned directly or indirectly through
wholly-owned Subsidiaries by the Company and all of such shares have been duly
and validly authorized and issued and are fully paid and non-assessable and no
party has a right to acquire any such capital stock and there are no
outstanding subscription options, warrants, commitments, convertible
securities, preemptive rights or other rights exercisable or exchangeable for
or convertible into such capital stock.

6.15 Insurance. Except as specifically disclosed in Schedule 6.15,
the properties of the Company and its Subsidiaries are insured as required by
Section 7.06.

6.16 Swap Obligations. Neither the Company nor any of its
Subsidiaries has incurred any outstanding obligations under any Swap Contracts,
other than Permitted Swap Obligations.

6.17 Subordinated Debt. The subordination provisions of the
Subordinated Notes and the Subordinated Debt Indenture will be enforceable
against the holders of the Subordinated Notes by the holder of any Senior
Indebtedness which has not effectively waived the benefits thereof, and the
Notes and all other monetary obligations hereunder are within the definition of
"Senior Indebtedness" and "Specified Senior Indebtedness" included in such
provisions and are entitled to the benefits of the subordination created by the
Subordinated Debt Indenture and the Subordinated Notes. All payments of
principal of or interest on the Subordinated Notes made by the Company or from
the liquidation of its property will be subject to such subordination
provisions. The Company acknowledges that each bank now or hereafter entering
into this Agreement is making its Loans in reliance upon such subordination
provisions. The Subordinated Note have been duly registered or qualified under
applicable federal or state securities laws or are exempt from such
registration or qualification.

6.18 Security Documents. The security interests created in favor
of Agent, as Pledgee for the benefit of the Banks under the Pledge Agreement,
constitute first perfected security interests in the Pledged Stock and Pledged
Notes, subject to no security interests of any other Person other than Liens
permitted hereby. Except as set forth in the Pledge Agreement, no filings,
registrations or recordings which have not been made or will not have been made
(or submitted for recordation)

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within 10 Business Days after the Closing Date are required in order to perfect
the security interests created in the Pledged Stock or Pledged Notes under the
Pledge Agreement. All of the capital stock of each Material Subsidiary which
is a Domestic Subsidiary is pledged to the Agent pursuant to the Pledge
Agreement, provided, however, that the consolidated total assets of Domestic
Subsidiaries, the capital stock of which is not pledged to the Agent under the
Pledge Agreement shall not exceed 7.5% of the Company's consolidated total
assets.

6.19 Full Disclosure. None of the representations or warranties
made by the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made, and none of the
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Company or any Subsidiary in connection with the Loan
Documents (including the offering and disclosure materials delivered by or on
behalf of the Company to the Banks prior to the Closing Date) taken as a whole,
contains any untrue statement of a material fact or omits any material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they are made, not misleading as of
the time when made or delivered. All projections and pro forma financial
information contained in any materials furnished by or on behalf of the Company
or any of its Subsidiaries to each Bank are based on good faith estimates and
assumptions by the management of the Company or the applicable Subsidiary, it
being recognized by Banks, however, that projections as to future events are
not to be viewed as fact and that actual results during the period or periods
covered by any such projections may differ from the projected results and that
the differences may be material.

ARTICLE VII

AFFIRMATIVE COVENANTS

So long as any Bank shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid, unless the Majority Banks waive
compliance in writing:

7.01 Financial Statements. The Company shall deliver to the Agent
and each Bank:

(a) as soon as available, but not later than 90 days
after the end of each fiscal year, a copy of the audited consolidated balance
sheet of the Company and its Subsidiaries as at the end of such year and the
related consolidated statements of income or operations, shareholders' equity
and cash flows for such year, setting forth in each case in comparative form
the figures for the previous fiscal year, and accompanied by the opinion of
Deloitte & Touche or another nationally-recognized independent public
accounting firm ("Independent Auditor") which report shall state that such
consolidated financial statements present fairly the financial position for the
periods indicated in conformity with GAAP applied on a consistent basis. Such
opinion shall not be qualified or limited, in either case, because of a
restricted or limited examination by the Independent Auditor of any material
portion of the Company's or any Subsidiary's records and shall be delivered to
the Agent pursuant to a reliance letter between the Agent and Banks and such
Independent Auditor in form and substance satisfactory to the Agent;

<PAGE> 71

(b) as soon as available, but not later than 45 days
after the end of each of the first three fiscal quarters of each fiscal year
(commencing with the fiscal quarter ended June 30, 1996), a copy of the
unaudited consolidated balance sheet of the Company and its Subsidiaries as of
the end of such quarter and the related consolidated statements of income for
such quarter and the year to date period ending, shareholders' equity and cash
flows for the period commencing on the first day of the fiscal year and ending
on the last day of such quarter, and certified by a Responsible Officer as
fairly presenting, in accordance with GAAP (subject to ordinary, good faith
year-end audit adjustments), the financial position and the results of
operations of the Company and the Subsidiaries;

(c) as soon as available, but not later than 90 days
after the end of each fiscal year, a copy of an unaudited consolidating balance
sheet of the Company and its Subsidiaries as at the end of such year and the
related consolidating statement of income, shareholders' equity and cash flows
for such year, certified by a Responsible Officer as having been developed and
used in connection with the preparation of the financial statements referred to
in subsection 7.01(a);

(d) promptly when available and in any event within 45
days after the close of each Fiscal Year commencing with the Fiscal Year ending
December 31, 1996, a business and financial plan, including projections of cash
flows and statements of income (each on both a consolidated and consolidating
basis), for the Company and its Subsidiaries for the then current Fiscal Year,
setting forth such projections (on a consolidated basis) on a
quarter-by-quarter basis and including a projected year-end consolidated
balance sheet; and

(e) promptly upon receipt thereof, copies of all
statements as to the material weaknesses of accounting controls submitted to
the Company by independent public accountants in connection with each annual or
interim audit made by such accountants of the financial statements of the
Company or any of its Subsidiaries.

To the extent included therein, the information required to be
delivered pursuant to this Section 7.01 may be delivered by delivery of the
financial statements and reports required to be delivered pursuant to
subsection 7.02(c).

7.02 Certificates; Other Information. The Company shall furnish to
the Agent and each Bank:

(a) concurrently with the delivery of the financial
statements referred to in subsection 7.01(a), a certificate of the Independent
Auditor stating that in making the examination necessary therefor no knowledge
was obtained of any Default or Event of Default, except as specified in such
certificate;

(b) concurrently with the delivery of the financial
statements referred to in subsections 7.01(a) and (b), a Compliance Certificate
executed by a Responsible Officer;

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(c) promptly, copies of all financial statements and
reports that the Company sends to its shareholders, and copies of all financial
statements and regular, periodical or special reports (including Forms 10K, 10Q
and 8K but not including Forms 3, 4 or 5) that the Company or any Subsidiary
may make to, or file with, the SEC; and

(d) promptly, such additional information regarding the
business, financial or corporate affairs of the Company or any Subsidiary as
the Agent, at the request of any Bank, may from time to time reasonably
request.

7.03 Notices. The Company shall promptly notify the Agent and each
Bank:

(a) of the occurrence of any Default or Event of Default,
upon a Responsible Officer becoming aware thereof;

(b) of any matter that has resulted or may (in the
reasonable judgment of the Company), reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Contractual Obligation of the Company or any Subsidiary; (ii)
any dispute, litigation, investigation, proceeding or suspension between the
Company or any Subsidiary and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting the Company or any Subsidiary; including pursuant to any applicable
Environmental Laws;

(c) of the occurrence of any of the following events
affecting the Company or any ERISA Affiliate (but in no event more than 30 days
after such event), and deliver to the Agent and each Bank a copy of any notice
with respect to such event that is filed with a Governmental Authority and any
notice delivered by a Governmental Authority to the Company or any ERISA
Affiliate with respect to such event:

(i) an ERISA Event or Events which could reasonably be
expected to result in liability of the Company in an aggregate amount
in excess of $5,000,000; or

(ii) the Unfunded Pension Liability among all Pension Plans
is reasonably expected to exceed $5,000,000.

(d) of any material change in accounting policies or
financial reporting practices by the Company or any of its consolidated
Subsidiaries;

(e) upon the request from time to time of the Agent, the
Swap Termination Values, together with a description of the method by which
such values were determined, relating to any then-outstanding Swap Contracts to
which the Company or any of its Subsidiaries is party.

Each notice under this Section shall be accompanied by a
written statement by a Responsible Officer setting forth details of the
occurrence referred to therein, and stating what action

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the Company or any affected Subsidiary proposes to take with respect thereto
and at what time (although the failure to take any such action shall not
constitute a Default or Event of Default under this Agreement). Each notice
under subsection 7.03(a) shall describe each Default or Event of Default which
has occurred or which is expected to occur.

7.04 Preservation of Corporate Existence, Etc. The Company shall,
and shall cause each Material Subsidiary to:

(a) preserve and maintain in full force and effect its
corporate existence and good standing under the laws of its state or
jurisdiction of incorporation, except as otherwise permitted by this Agreement;

(b) preserve and maintain in full force and effect all
governmental rights, privileges, qualifications, permits, licenses and
franchises necessary or desirable in the normal conduct of its business except
in connection with transactions permitted by Section 8.03 and sales of assets
permitted by Section 8.02 and except for any of the foregoing the expiration or
termination of which could not reasonably be expected to have a Material
Adverse Effect;

(d) preserve or renew all of its registered patents,
trademarks, trade names and service marks, the non-preservation of which could
reasonably be expected to have a Material Adverse Effect.

7.05 Maintenance of Property. The Company shall maintain, and
shall cause each Material Subsidiary to maintain, and preserve all its property
which is used in its business in good working order and condition, ordinary
wear and tear excepted except where the failure to so maintain or preserve
could not reasonably be expected to have a Material Adverse Effect, except as
permitted by Section 8.02.

7.06 Insurance. The Company shall maintain, and shall cause each
Subsidiary to maintain, with financially sound and reputable independent
insurers, insurance with respect to its properties and business against loss or
damage of the kinds customarily insured against by Persons engaged in the same
or similar business, of such types and in such amounts as are customarily
carried under similar circumstances by such other Persons, provided that the
Company and its Subsidiaries may self-insure against such risks and in such
amounts as is usually self-insured by companies engaged in similar businesses
and owning similar properties in the same general areas in which the Company or
such Subsidiary operates.

7.07 Payment of Tax Obligations. The Company shall, and shall
cause each Subsidiary to, pay and discharge as the same shall become due and
payable, all tax liabilities, assessments and governmental charges or levies
upon it or its properties or assets, unless the same are being

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contested in good faith by appropriate proceedings and adequate reserves in
accordance with GAAP are being maintained by the Company or such Subsidiary.

7.08 Compliance with Laws. The Company shall comply, and shall
cause each Subsidiary to comply, in all material respects with all Requirements
of Law of any Governmental Authority having jurisdiction over it or its
business (including the Federal Fair Labor Standards Act), except where the
failure to so comply could not reasonably be expected to have a Material
Adverse Effect.

7.09 Compliance with ERISA. The Company shall, and shall cause
each of its ERISA Affiliates to: (a) maintain each Plan in compliance in all
material respects with the applicable provisions of ERISA, the Code and other
federal or state law; (b) cause each Plan which is qualified under Section
401(a) of the Code to maintain such qualification; and (c) make all required
contributions to any Plan subject to Section 412 of the Code except, in the
case of (a),(b) and (c) above where such failure to maintain or contribute
could not reasonably be expected to result in liability of the Company in
excess of $5,000,000 in the aggregate.

7.10 Inspection of Property and Books and Records. The Company
shall maintain and shall cause each Subsidiary to maintain proper books of
record and account, in which full, true and correct entries in conformity with
GAAP consistently applied shall be made of all financial transactions and
matters involving the assets and business of the Company and such Subsidiary.
The Company shall permit, and shall cause each Subsidiary to permit,
representatives and independent contractors of the Agent or representatives of
any Bank to visit and inspect any of their respective properties, to examine
their respective corporate, financial and operating records, and make copies
thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective directors, officers, and, in the
presence of the Company if the Company shall so request, independent public
accountants, all such reasonable times during normal business hours and as
often as may be reasonably desired, upon reasonable advance notice to the
Company.

7.11 Environmental Laws. The Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
compliance with all Environmental Laws, except where the failure to so comply
could not reasonably be expected to have a Material Adverse Effect.

7.12 Use of Proceeds. The Company shall use the proceeds of the
Loans for working capital and other general corporate purposes not in
contravention of any Requirement of Law (including Regulation G, T, U and X of
the FRB) or of any Loan Document.

7.13 Additional Guarantors. In the event any Domestic Subsidiary
shall hereafter become a Material Subsidiary, the Company shall promptly cause
such Material Subsidiary to become a party to the Subsidiary Guaranty Agreement
by executing an addendum thereto in form satisfactory to the Agent.

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ARTICLE VIII

NEGATIVE AND FINANCIAL COVENANTS

So long as any Bank shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid, unless the Majority Banks waive
compliance in writing:

8.01 Limitation on Liens. The Company shall not, and shall not
suffer or permit any Subsidiary to, directly or indirectly, make, create,
incur, assume or suffer to exist any Lien upon or with respect to any part of
its property, whether now owned or hereafter acquired, other than the following
("Permitted Liens"):

(a) any Lien existing on property of the Company or any
Subsidiary on the Closing Date and set forth in Schedule 8.01 securing
Indebtedness outstanding on such date;

(b) any Lien created under any Loan Document;

(c) Liens for taxes, fees, assessments or other
governmental charges which are not delinquent or remain payable without
penalty, or to the extent that non-payment thereof is permitted by Section
8.07, provided that no notice of lien has been filed or recorded under the
Code;

(d) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the ordinary
course of business which are not delinquent for more than 90 days or remain
payable without penalty or which are being contested in good faith and by
appropriate proceedings, which proceedings have the effect of preventing the
forfeiture or sale of the property subject thereto;

(e) Liens (other than any Lien imposed by ERISA)
consisting of pledges or deposits required in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other
social security legislation;

(f) Liens on the property of the Company or its
Subsidiary securing (i) the non-delinquent performance of bids, trade
contracts (other than for borrowed money), leases, statutory obligations, (ii)
contingent obligations on surety and appeal bonds, and (iii) other
non-delinquent obligations of a like nature; in each case, incurred in the
ordinary course of business and treating as non-delinquent any delinquency
which is being contested in good faith and by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the
property subject thereto;

(g) Liens consisting of judgment or judicial attachment liens
with respect to judgments which do not constitute an Event of Default and in
the aggregate do not exceed $5,000,000;

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(h) easements, rights-of-way, restrictions and other
similar encumbrances which, in the aggregate, are not substantial in amount,
and which do not in any case materially detract from the value of the property
subject thereto or interfere with the ordinary conduct of the businesses of the
Company and its Subsidiaries;

(i) Liens on assets of corporations which become Subsidiaries
after the date of this Agreement, provided, however, that such Liens existed at
the time the respective corporations became Subsidiaries and were not created
in anticipation thereof;

(j) purchase money security interests on any property
acquired or held by the Company or its Subsidiaries in the ordinary course of
business, securing Indebtedness incurred or assumed for the purpose of
financing all or any part of the cost of acquiring such property; provided that
(i) any such Lien attaches to such property concurrently with or within 90 days
after the acquisition thereof, (ii) such Lien attaches solely to the property
so acquired in such transaction and the proceeds thereof, (iii) the principal
amount of the debt secured thereby does not exceed 100% of the cost of such
property, and (iv) the principal amount of the Indebtedness secured by any and
all such purchase money security interests shall not at any time exceed,
together with Indebtedness permitted under subsection 8.05(d), $10,000,000;

(k) Liens arising solely by virtue of any statutory or
common law provision relating to banker's liens, rights of set-off or similar
rights and remedies as to deposit accounts or other funds maintained with a
creditor depository institution; provided that (i) such deposit account is not
a dedicated cash collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by regulations promulgated
by the FRB, and (ii) such deposit account is not intended by the Company or any
Subsidiary to provide collateral to the depository institution; and

(l) Liens consisting of pledges of cash collateral or
government securities to secure on a mark-to-market basis Permitted Swap
Obligations only, provided that (i) the counterparty to any Swap Contract
relating to such Permitted Swap Obligations is under a similar requirement to
deliver similar collateral from time to time to the Company or the Subsidiary
party thereto on a mark-to-market basis; and (ii) the aggregate value of such
collateral so pledged by the Company and the Subsidiaries together in favor of
any counterparty does not at any time exceed $5,000,000.

(m) Liens securing reimbursement obligations for letters
of credit which encumber only goods, or documents of title covering goods,
which are purchased in transactions for which such letters of credit are
issued; and

(n) any extension, renewal or substitution of or for any
of the foregoing Liens; provided that (i) the Indebtedness or other obligation
or liability secured by the applicable Lien shall not exceed the Indebtedness
or other obligation or liability existing immediately prior to such extension,
renewal or substitution and (ii) the Lien securing such Indebtedness or other
obligation

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or liability shall be limited to the property which, immediately prior to such
extension, renewal or substitution, secured such Indebtedness or other
obligation or liability; and

(o) other Liens securing obligations (other than
Indebtedness for money borrowed) which do not exceed $2,000,000 in the
aggregate at any one time outstanding.

8.02 Disposition of Assets. The Company shall not, and shall not
suffer or permit any Subsidiary to, directly or indirectly, sell, assign,
lease, convey, transfer or otherwise dispose of (collectively, a "Disposition")
(whether in one or a series of transactions) any property (including accounts
and notes receivable, with or without recourse) or enter into any agreement to
do any of the foregoing, except:

(a) Dispositions of inventory, or used, worn-out,
obsolete or surplus equipment, all in the ordinary course of business;

(b) Dispositions of equipment and other fixed assets to
the extent that such equipment or other fixed assets is exchanged for credit
against the purchase price of similar replacement equipment or other fixed
assets, or the proceeds of such sale are reasonably promptly applied to the
purchase price of such replacement equipment or other fixed assets; and

(d) Disposition of assets received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement of
delinquent obligations of, and other disputes with, customers and suppliers
arising in the ordinary course of business; and

(e) Dispositions of assets between and among the Company
and its Wholly-Owned Subsidiaries and the Disposition of assets from any other
Subsidiary to the Company or a Wholly-Owned Subsidiary of the Company; and

(f) Dispositions not otherwise permitted hereunder which
are made for fair market value; provided, that (i) at the time of any
disposition, no Event of Default shall exist or shall result from such
disposition, (ii) the aggregate sales price from such disposition shall be paid
in cash (provided, that the Company may accept promissory notes in an aggregate
principal amount outstanding at any time not to exceed $2,000,000), and (iii)
the aggregate value of all assets so sold by the Company and its Subsidiaries
pursuant to this clause (f), together, shall not exceed in any fiscal year, 5%
of the consolidated total assets of the Company as of the end of the most
recent fiscal year (but excluding, for purposes of calculation of such 5%
amount, the assets of any operating business sold as a whole in compliance with
the proviso at the end of this subsection), provided further that the sale by
the Company or any Subsidiary of one or more operating business in one year
which, in the aggregate, accounts for more than 10% of EBITDA of the Company as
of the most recently ended fiscal year shall require the consent of the
Majority Banks and, the Company, on a

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pro forma basis calculated as of the last day of the most recently completed
fiscal quarter, shall be in compliance with the Funded Debt to EBITDA Ratio as
of the date of such disposition.

Upon the permitted Disposition by any Subsidiary Guarantor of
all or substantially all of its assets to any Person (and after the subsequent
distribution of the consideration received therefor by such Subsidiary
Guarantor to the Company or another Guarantor), such Guarantor shall be
automatically released from its obligations under the Subsidiary Guaranty
Agreement. The Agent shall provide written confirmation of such release to the
Company upon the Company's request therefor.

8.03 Consolidations and Mergers. The Company shall not, and shall
not suffer or permit any Subsidiary to, merge, consolidate with or into any
Person, except:

(a) any Subsidiary may merge with the Company, provided
that the Company shall be the continuing or surviving corporation, or with any
one or more Subsidiaries, provided that if any transaction shall be between a
Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be
the continuing or surviving corporation; and

(b) any Subsidiary may sell all or substantially all of
its assets (upon voluntary liquidation or otherwise), to the Company or another
Wholly-Owned Subsidiary or as otherwise permitted by Section 8.02.

Any Disposition of assets which would be permitted by Section 8.02 may also be
done via merger or consolidation and such merger or consolidation (which
results solely in a Disposition otherwise permitted by Section 8.02) shall be
permitted pursuant to this Section 8.03.

8.04 Loans and Investments. The Company shall not purchase or
acquire, or suffer or permit any Subsidiary to purchase or acquire, or make any
commitment therefor, any capital stock, equity interest, or any obligations or
other securities of, or any interest in, any Person, or make or commit to make
any Acquisitions, or make or commit to make any advance, loan, extension of
credit or capital contribution to or any other investment in, any Person
including any Affiliate of the Company (together, "Investments"), except for:

(a) Investments held by the Company or Subsidiary in the
form of cash or cash equivalents;

(b) extensions of credit in the nature of accounts
receivable or notes receivable arising from the sale or lease of goods or
services in the ordinary course of business;

(c) extensions of credit by the Company or its
Subsidiaries to their employees in the ordinary course of business for travel,
relocation and related expenses;

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(d) existing Investments in Subsidiaries and the other
Investments identified on Schedule 8.04 (in each case, as such Investments may
be adjusted due to appreciation, repayment of principal, payment of interest,
return of capital and similar circumstances);

(e) additional Investments in any Domestic Subsidiary
(other than an Investment constituting an Acquisition which shall be governed
by Section 8.04 (g) or (h) below; provided that (i) any such additional equity
Investments in Domestic Subsidiaries after the Closing Date shall not exceed,
in the aggregate $10,000,000 outstanding, and (ii) any such Investment
constituting a loan or advance to a Domestic Subsidiary shall be made from the
Company pursuant to one of the Pledged Notes;

(f) Investments by Borrower or any Domestic Subsidiary in
any Foreign Subsidiary after the Closing Date in an amount which will not
result in a breach of Section 8.15 or, in the case of any Foreign Subsidiary,
Investments in any Subsidiary of such Foreign Subsidiary or Investments
consisting of a loan or advance of available cash to another Foreign
Subsidiary;

(g) subject to the last sentence of this Section 8.04,
the purchase or acquisition by the Company or any of its Subsidiaries of at
least 75% of the stock of, or substantially all of the assets of, any
corporation (or any division thereof) or the purchase or acquisition by the
Company or any of its Subsidiaries of a partnership, joint venture, or similar
interest in a Person but only if after giving effect thereto, the aggregate
amount paid (whether in cash, notes or stock or by way of liabilities assumed)
shall not exceed $50,000,000 in any one purchase or acquisition;

(h) subject to the last sentence of this Section 8.04,
the purchase or acquisition by the Company or any of its Subsidiaries of at
least 75% of the stock of, or substantially all of the assets of, any
corporation (or any division thereof), or the purchase or acquisition by the
Company or any of its Subsidiaries of a partnership, joint venture or similar
interest in a Person, but only after giving effect thereto, the pro forma
EBITDA less the pro forma Capital Expenditures of the Company (assuming such
purchase or acquisition had occurred on the first day of the most recently
ended four fiscal quarter period) for the period of four quarters immediately
preceding the date such purchase or acquisition is consummated exceeds the pro
forma Consolidated Interest Expenses of the Company for such four quarter
period by a ratio of 3.0 to 1.0;

(i) Investments constituting Permitted Swap Obligations or
payments or advances under Swap Contracts relating to Permitted Swap
Obligations;

(j) Investments in the ordinary course of business by any
Subsidiary of the Company engaged in the manufacturer sale of machine tools by
way of agreements providing for the repurchase by such Subsidiary of machine
tools sold by it in the event that its customer shall default in its
obligations to a third party who, directly or indirectly, provided financing
for the acquisition of such machine tools;

(k) Investments held by any Subsidiary of the Company in
any of its customers or suppliers which are received as distributions in
bankruptcy proceedings or as negotiated

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settlements for obligations incurred to it by such customer for the purchase of
goods manufactured or services provided by it; and

(l) Investments by way of stock or similar ownership
interests of 50% or less in any Person in an aggregate amount not to exceed
$5,000,000 at any one time;

(m) Investments by way of promissory notes or received in
connection with a disposition permitted by Section 8.02(f);

(n) additional investments of a nature not contemplated
by the foregoing clauses (a) through (k) not to exceed $10,000,000 in the
aggregate at any time outstanding.

Notwithstanding any provision of the foregoing clauses (g) and (h) of this
Section 8.04 to the contrary, any Acquisition otherwise provided for in clause
(g) or (h) of this Section 8.04 shall be permitted if and only if: (1) before
and after giving effect to such Acquisition, no Default or Event of Default
shall have occurred and be continuing, (2) after giving effect to such
Acquisition not less than 5% of the aggregate Commitment shall be unused on the
date such Acquisition is consummated, (3) not less than 10 days prior to the
consummation of such Acquisition, the Company shall provide to the Agent annual
financial statements (audited, if available) and unaudited interim financial
statements for such person, pro forma financial projections for such Person and
for the Company on a consolidated basis giving effect to such Acquisition, all
in such detail as shall be reasonably satisfactory to the Agent, (4) if
required by Section 7.13, the Company shall promptly deliver to Agent the
addendum to the Subsidiary Guaranty Agreement executed by any Subsidiary
organized to effect such an Acquisition or newly acquired in connection with an
Acquisition and, pursuant to the Pledge Agreement, deliver the stock
certificates evidencing all issued and outstanding shares of stock of any such
Subsidiary, along with stock powers executed in blank, simultaneously with the
consummation of such Acquisition and the Company will cause any such Subsidiary
to execute an Intercompany Note, evidencing any loan from the Company or any
such Subsidiary, the proceeds of which were applied to the costs and expenses
of such Acquisition, and the Company shall, pursuant to the Pledge Agreement,
deliver to the Agent, such Intercompany Note of such Subsidiary, endorsed in
blank by the Company, within thirty (30) days following the consummation of
such Acquisition; and (5) the prior, effective written consent or approval of
such Acquisition by the board of directors or equivalent governing body of the
acquiree is obtained. Promptly following the consummation of any such
Acquisition, the Company shall provide to the Agent a copy of the agreement or
agreements setting forth the terms and conditions of such Acquisition in its
then current form, including all material exhibits and other material
agreements executed and delivered, or required to be executed and delivered in
connection therewith, including, without limitation, any environmental
assessment reports, if applicable, certified by a Responsible Officer to be
true, correct and complete,

8.05 Limitation on Indebtedness. The Company shall not, and shall
not suffer or permit any Subsidiary to, create, incur, assume, suffer to exist,
or otherwise become or remain directly or indirectly liable with respect to,
any Indebtedness, except:

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(a) Indebtedness incurred pursuant to this Agreement;

(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to Section 8.07;

(c) Indebtedness existing on the Closing Date and set forth in
Schedule 8.05, including Indebtedness incurred to support LUKAS GmbH in a
principal amount not to exceed $35,000,000 and any Refinancing Indebtedness with
respect thereto;

(d) Indebtedness secured by Liens permitted by subsection 8.01(i)
and (j) in an aggregate amount outstanding at any time not to exceed
$10,000,000;

(e) Intercompany Indebtedness to the extent permitted by Section
8.04; provided, however, that in the event of any subsequent issuance or
transfer of any capital stock which results in the holder of such Indebtedness
ceasing to be a Subsidiary of the Company or any subsequent transfer of such
Indebtedness (other than to the Company or any of its Subsidiaries) such
Indebtedness shall be required to be permitted under another clause of this
Section 8.05; provided, further, however, that (x) in the case of Intercompany
Indebtedness consisting of a loan or advance to Borrower, each such loan or
advance shall be subordinated to the indefeasible payment in full of all of
Borrower's obligations pursuant to this Agreement and the other Loan Documents
and (y) in the case of Intercompany Indebtedness consisting of a loan or advance
from the Company to any Domestic Subsidiary, such Indebtedness shall be
evidenced by a Pledged Note;

(f) Subordinated Debt of the Company in an aggregate amount not to
exceed $150,000,000 so long as, with respect to any Subordinated Debt incurred
after the date hereof, a portion of the proceeds thereof are used as soon as
practicable after the issuance thereof to redeem or defease all of the
outstanding Subordinated Notes (it being understood that with respect to such
Subordinated Debt, the approval of the Majority Banks required by clause (b) of
the definition of Subordinated Debt will not be unreasonably withheld); and

(g) Indebtedness of any Foreign Subsidiary and unsecured guarantees
thereof by the Company provided that the aggregate amount of such Indebtedness
under this clause (g) does not exceed, without duplication, $75,000,000 at any
one time outstanding.

(h) Unsecured Indebtedness of the Company which when added to the
amount of Indebtedness outstanding and permitted pursuant to Section 8.05(g)
does not in the aggregate exceed $75,000,000 at any one time outstanding.

8.06 Transactions with Affiliates. The Company will not, and will not
permit any of its Subsidiaries to, enter into, or cause, suffer or permit to
exist:

(a) any arrangement or contract with any of its other Affiliates
of a nature customarily entered into by Persons which are Affiliates of each
other for tax or financial reporting purposes (including, without limitation,
management or similar contracts or

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arrangements relating to the allocation of revenues, taxes and expenses or
otherwise) unless such arrangement or contract is fair and equitable to the
Company or such Subsidiary;

(b) any other transaction, arrangement or contract with any of its
other Affiliates which would not be entered into by a prudent Person in the
position of the Company or such Subsidiary with, or which is on terms which
are less favorable than are obtainable from, any Person which is not one of
its Affiliates;

provided, however, that nothing in this Section shall be construed to restrict
the Company from paying (i) an annual fee to KKR or its Affiliates for the
rendering of management consulting and financial services to the Company and
its Subsidiaries in an aggregate amount not to exceed an amount reasonably
determined by taking into account the practices of KKR with respect to other
companies for which it performs such management consulting and financial
services and the amount of assets of the Company relative to such other
companies, (ii) reasonable and customary regular fees to directors of the
Company who are not employees of the Company, and (iii) normal and customary
financial advisory fees to KKR or its Affiliates made in connection with the
acquisition or disposition of any Subsidiary of the Company permitted hereunder
so long as no other such fees are paid by the Company to any other financial
advisor in connection with such acquisition or disposition.

8.07 Contingent Obligations. The Company shall not, and shall not
suffer or permit any Subsidiary to, create, incur, assume or suffer to exist any
Contingent Obligations except:

(a) endorsements for collection or deposit in the ordinary course
of business;

(b) Permitted Swap Obligations;

(c) Contingent Obligations of the Company and its Subsidiaries
existing as of the Closing Date and listed in Schedule 7.08;

(d) Contingent Obligations with respect to Surety Instruments
incurred in the ordinary course of business;

(e) Contingent Obligations of a Subsidiary required to be entered
into pursuant to the Subordinated Debt Indenture;

(f) Guaranty Obligations of the Company or any Subsidiary
Guarantor with respect to any Indebtedness permitted pursuant to this Agreement;
and

(g) in addition to other Contingent Obligations permitted
hereunder, Contingent Obligations which do not exceed $1,000,000 in the
aggregate at any one time outstanding.

8.08 Restricted Payments. The Company shall not, and shall not suffer
or permit any Subsidiary to, (i) declare or make any dividend payment or other
distribution of assets, properties,

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cash, rights, obligations or securities on account of any shares of any class
of its capital stock, or purchase, redeem or otherwise acquire for value any
shares of its capital stock or any warrants, rights or options to acquire such
shares, now or hereafter outstanding, (ii) prepay or repay any principal of or
make any payment of interest on, or redeem, or set aside any funds for the
payment, prepayment or redemption of, or purchase or otherwise acquire any
interest in, any Subordinated Debt or (iii) make any deposit for any of the
foregoing purposes (each of (i), (ii) or (iii), a "Restricted Payment"); except
that:

(a) any Wholly-Owned Subsidiary may pay dividends and make
distributions to the Company or to any other Wholly-Owned Subsidiary;

(b) the Company and any Subsidiary may declare and make dividend
payments, dividends or distributions payable in its common stock, or warrants to
purchase its common stock, or splitups or reclassifications of its common stock
into additional or other shares of its common stock, or conversions from one
class of common stock into another or other distributions payable solely in its
common stock;

(c) The Company may, subject to the subordination provisions
contained in the Subordinated Debt Indenture, make payments of interest accrued
on the Subordinated Notes or other Subordinated Debt when due;

(d) the Company may prepay, redeem or defease all of the
principal amount of the Subordinated Notes with the proceeds of other
Subordinated Debt incurred pursuant to Section 8.05(f) or with the proceeds from
the issuance or sale of non-redeemable common stock subsequent to the date
hereof (other than an issuance or sale to a Subsidiary or an employee stock
ownership plan); and

(e) the Company may make Restricted Payments, in an aggregate
amount from and after the Closing Date not in excess of 50% of Consolidated Net
Income of the Company and its Subsidiaries arising after January 1, 1993, and
computed on a cumulative consolidated basis; provided that, immediately after
giving effect to such proposed action (or in the case of dividends declared not
earlier than 45 days prior to the payment thereof at the time of such
declaration), no Default or Event of Default would exist.

8.09 ERISA. The Company shall not, and shall not suffer or permit any
of its ERISA Affiliates to: (a) engage in a prohibited transaction or violation
of the fiduciary responsibility rules with respect to any Plan which has
resulted or could reasonably expected to result in liability of the Company in
an aggregate amount in excess of $5,000,000; or (b) engage in a transaction that
could be subject to Section 4069 or 4212(c) of ERISA and which could reasonably
be expected to result in liability of the Company in excess of $5,000,000.

8.10 Change in Business. The Company shall not, and shall not suffer or
permit any Subsidiary to, engage in any material line of business substantially
different from those lines of business carried on by the Company and its
Subsidiaries on the date hereof.

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8.11 Accounting Changes. The Company shall not, and shall not suffer or
permit any Subsidiary to, make any significant change in accounting treatment or
reporting practices, except as required by GAAP, or change the fiscal year of
the Company.

8.12 Modifications, etc. of Subordinated Debt and Related Documents.
The Company will not

(a) consent to any increase of the interest rate applicable to,
or any amendment of any subordination or sinking fund provisions or terms of
required repayment or redemption contained in or applicable to, any Subordinated
Debt or any Guaranty thereof (except any extension in time of any such sinking
fund provision or term of required prepayment or redemption), or

(b) consent or agree to any amendment, supplement or waiver to
the Subordinated Debt Indenture, the Subordinated Notes or any instruments
executed pursuant thereto or any other Subordinated Debt which increase
materially the obligations (payment or otherwise) of or burdens upon the Company
thereunder or supplements the rights or the holders of the Subordinated Notes
(including without limitation in connection with any Guaranty by any Subsidiary
thereunder) or the holders of such other Subordinated Debt in a manner
detrimental to the Banks.

8.13 Sale-Leasebacks. The Company shall not, nor shall it permit any of
its Subsidiaries to, directly or indirectly, lease any property as lessee in
connection with a Sale and Leaseback Transaction entered into after the Closing
Date.

8.14 No Negative Pledges; Subsidiary Payments. The Company will not,
and will not permit any of its Subsidiaries (other than Foreign Subsidiaries in
connection with the financings contemplated by Section 8.05(g)) to enter into or
suffer to exist any agreement (excepting this Agreement and any Instrument
executed pursuant hereto and the Subordinated Debt Indenture or any other
agreement evidencing Subordinated Debt) (a) prohibiting the creation or
assumption of any security interest upon its properties or assets, whether now
owned or hereafter acquired or (b) which would restrict the ability of any
Subsidiary to pay or make dividends or distributions, in cash or kind, or to
make loans, advances or other payments of whatsoever nature, or to make
transfers or dispositions of all or part of its assets, in each case to the
Company; provided, however, in the case of a consensual Lien on assets or
property that is permitted pursuant to Section 8.01, the Lien holder may, solely
with respect of the assets or property to which such Lien attaches, contract for
and receive a negative pledge with respect thereto and the proceeds and products
thereof.

8.15 Foreign Operations. The Company will not permit more than 30% of
its consolidated total assets to be held by Foreign Subsidiaries or otherwise
located outside of the United States.

8.16 Financial Covenants

(a) Fixed Charge Coverage Ratio. For the period of four
consecutive fiscal quarters ending on the last day of each fiscal quarter, the
Company shall not permit the ratio of (i)

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EBITDA less Capital Expenditures plus Consolidated Rental Expense, in each case
for such four fiscal quarter period to (ii) Consolidated Fixed Charges for
such period to be less than 1.25:1.0.

(b) Leverage Ratio. The Company shall not permit the ratio of
(a) Funded Debt to (b) Total Capitalization of the Company at the end of any
fiscal quarter to exceed 70%.

(c) Funded Debt to EBITDA. The Company shall not permit the
Funded Debt to EBITDA Ratio as of the last day of any fiscal quarter ending
within the periods set forth below to exceed the applicable ratio set forth
below:

PERIOD MAXIMUM RATIO
------ -------------
<S> <C>
Closing Date - 9/30/98 3.50 to 1.0
12/31/98 - 9/30/99 3.25 to 1.0
12/31/99 and thereafter 3.00 to 1.0
</TABLE>

ARTICLE IX

EVENTS OF DEFAULT

9.01 Event of Default. Any of the following shall constitute an "Event
of Default":

(a) Non-Payment. The Company fails to pay, (i) when and as
required to be paid herein, any amount of principal of any Loan or any amount of
interest on any Bid Loan, or (ii) within five (5) days after the same becomes
due, any interest, fee or any other amount payable hereunder or under any other
Loan Document; or

(b) Representation or Warranty. Any representation or warranty
by the Company or any Subsidiary made or deemed made herein, in any other Loan
Document, or which is contained in any certificate, document or financial or
other statement by the Company, any Subsidiary, or any Responsible Officer,
furnished at any time under this Agreement, or in or under any other Loan
Document, is incorrect in any material respect on or as of the date made or
deemed made; or

(c) Specific Defaults. The Company fails to perform or observe
any term, covenant or agreement (i) contained in Sections 8.01, 8.04, 8.05 or
8.07 and such failure continues unremedied for five Business Days or (ii)
contained in any of Section 7.03(a) or 7.12 or in any other provision of Article
VIII; or

(d) Other Defaults. The Company or any Subsidiary party thereto
fails to perform or observe any other term or covenant contained in this
Agreement or any other Loan Document,

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and such default shall continue unremedied for a period of 20 days after the
date upon which written notice thereof is given to the Company by the Agent or
any Bank; or

(e) Cross-Default. (i) The Company or any Subsidiary (A) fails
to make any payment in respect of any Indebtedness or Contingent Obligation
(other than in respect of Swap Contracts), having an aggregate principal amount
(including undrawn committed or available amounts and including amounts owing to
all creditors under any combined or syndicated credit arrangement) of more than
$5,000,000 when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) and such failure continues after the
applicable grace or notice period, if any, specified in the relevant document on
the date of such failure; or (B) fails to perform or observe any other condition
or covenant, or any other event shall occur or condition exist, under any
agreement or instrument relating to any such Indebtedness or Contingent
Obligation, and such failure continues after the applicable grace or notice
period, if any, specified in the relevant document on the date of such failure
if the effect of such failure, event or condition is to cause, or to permit the
holder or holders of such Indebtedness or beneficiary or beneficiaries of such
Indebtedness (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause such Indebtedness to be declared to be
due and payable prior to its stated maturity, or such Contingent Obligation to
become payable or cash collateral in respect thereof to be demanded; or (ii)
there occurs under any Swap Contract an Early Termination Date (as defined in
such Swap Contract) resulting from (1) any event of default under such Swap
Contract as to which the Company or any Subsidiary is the Defaulting Party (as
defined in such Swap Contract) or (2) any Termination Event (as so defined) as
to which the Company or any Subsidiary is an Affected Party (as so defined),
and, in either event, the Swap Termination Value owed by the Company or such
Subsidiary as a result thereof is greater than $5,000,000; or

(f) Insolvency; Voluntary Proceedings. The Company or any
Material Subsidiary (i) ceases or fails to be solvent, or generally fails to
pay, or admits in writing its inability to pay, its debts as they become due,
subject to applicable grace periods, if any, whether at stated maturity or
otherwise; (ii) voluntarily ceases to conduct its business in the ordinary
course; (iii) commences any Insolvency Proceeding with respect to itself; or
(iv) takes any action to effectuate or authorize any of the foregoing; or

(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company or any Material Subsidiary,
or any writ, judgment, warrant of attachment, execution or similar process, is
issued or levied against a substantial part of the Company's or any Material
Subsidiary's properties, and any such proceeding or petition shall not be
dismissed, or such writ, judgment, warrant of attachment, execution or similar
process shall not be released, vacated or fully bonded within 60 days after
commencement, filing or levy; (ii) the Company or any Material Subsidiary admits
the material allegations of a petition against it in any Insolvency Proceeding,
or an order for relief (or similar order under non-U.S. law) is ordered in any
Insolvency Proceeding; or (iii) the Company or any Material Subsidiary
acquiesces in the appointment of a receiver, trustee, custodian, conservator,
liquidator, mortgagee in possession (or agent therefor), or other similar Person
for itself or a substantial portion of its property or business; or

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(h) ERISA. (i) An ERISA Event or Events shall occur with respect
to one or more Pension Plans or Multiemployer Plans which has resulted in
liability of the Company under Title IV of ERISA to such plans or the PBGC in an
aggregate amount in excess of $5,000,000; (ii) the aggregate amount of Unfunded
Pension Liability among all Pension Plans at any time exceeds $5,000,000; or
(iii) the Company or any ERISA Affiliate shall fail to pay when due, after the
expiration of any applicable grace period, any installment payment with respect
to its withdrawal liability under Section 4201 of ERISA under a Multiemployer
Plan in an aggregate amount in excess of $5,000,000; or

(i) Monetary Judgments. One or more non-interlocutory judgments,
non- interlocutory orders, decrees or arbitration awards is entered against the
Company or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage) as to any single or related series of transactions,
incidents or conditions, of $5,000,000 or more, and the same shall remain
unsatisfied, unvacated and unstayed pending appeal for a period of 10 days after
the entry thereof; or

(j) Change of Control. There occurs any Change of Control; or

(k) Guarantor Defaults. Any Subsidiary Guarantor fails in any
material respect to perform or observe (after giving effect to any applicable
grace period set forth therein) any term, covenant or agreement in the
Subsidiary Guaranty Agreement; or the Subsidiary Guaranty Agreement is for any
reason partially (including with respect to future advances) or wholly revoked
or invalidated, or otherwise ceases to be in full force and effect, or any
Subsidiary Guarantor or any other Person contests in any manner the validity or
enforceability thereof or denies that it has any further liability or obligation
thereunder; or any event described at subsections (f) or (g) of this Section
occurs with respect to any Subsidiary Guarantor; or

(l) Invalidity of Subordination Provisions. The subordination
provisions of the Subordinated Notes or any agreement or instrument governing
any other Subordinated Debt is for any reason revoked or invalidated, or
otherwise cease to be in full force and effect, any Person contests in any
manner the validity or enforceability thereof or denies that it has any further
liability or obligation thereunder, or the Indebtedness hereunder is for any
reason subordinated or does not have the priority contemplated by this Agreement
or such subordination provisions.

9.02 Remedies. If any Event of Default occurs and is continuing, the
Agent shall, at the request of, or may, with the consent of, the Majority Banks,

(a) declare the commitment of each Bank to make Loans to be
terminated, whereupon such commitments shall be terminated;

(b) declare the unpaid principal amount of all outstanding Loans,
all interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Company; and

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(c) exercise on behalf of itself and the Banks all rights and
remedies available to it and the Banks under the Loan Documents or applicable
law;

provided, however, that upon the occurrence and during the continuance of any
Event of Default specified in subsection (f) or (g) of Section 9.01 with
respect to the Company, the obligation of each Bank to make Loans shall
automatically terminate and the unpaid principal amount of all outstanding
Loans and all interest and other amounts as aforesaid shall automatically
become due and payable without further act of the Agent or any Bank. In
addition, following the occurrence and during the continuance of an Event of
Default, so long as any Letter of Credit has not been fully drawn and has not
been canceled or expired by its terms, upon demand by the Agent at the request
of the Majority Banks, the Company shall Cash Collateralize the dollar amount
of the aggregate undrawn amount of all Letters of Credit. Such funds shall be
promptly applied by the Agent to reimburse the Issuing Bank for drafts drawn
from time to time under the Letters of Credit. Such funds, if any, remaining
following the payment of all Obligations in full or the earlier termination of
all Events of Default shall, unless the Agent is otherwise directed by a court
of competent jurisdiction, be promptly paid over to the Company.

9.03 Rights Not Exclusive. The rights provided for in this Agreement
and the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.

ARTICLE X

THE AGENT

10.01 Appointment and Authorization; "Agent". Each Bank hereby
irrevocably (subject to Section 10.09) appoints, designates and authorizes the
Agent to take such action on its behalf under the provisions of this Agreement
and each other Loan Document and to exercise such powers and perform such duties
as are expressly delegated to it by the terms of this Agreement or any other
Loan Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Loan Document, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the Agent
have or be deemed to have any fiduciary relationship with any Bank, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Agent. Without limiting the generality of the
foregoing sentence, the use of the term "agent" in this Agreement with reference
to the Agent is not intended to connote any fiduciary or other implied (or
express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.

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10.02 Delegation of Duties. The Agent may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.

10.03 Liability of Agent. None of the Agent-Related Persons shall (i) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be responsible in any manner to any of the Banks for any recital,
statement, representation or warranty made by the Company or any Subsidiary or
Affiliate of the Company, or any officer thereof, contained in this Agreement or
in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Company or any other party to
any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Bank to ascertain or
to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the properties, books or records of the Company or any of the Company's
Subsidiaries or Affiliates.

10.04 Reliance by Agent.

(a) The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation reasonably believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon advice and statements of legal counsel (including counsel
to the Company), independent accountants and other experts selected by the
Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Banks as it deems appropriate
and, if it so requests, it shall first be indemnified to its satisfaction by the
Banks against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement or any other Loan Document in accordance with a request or consent of
the Majority Banks (or all of the Banks, as may be required) and such request
and any action taken or failure to act pursuant thereto shall be binding upon
all of the Banks.

(b) For purposes of determining compliance with the conditions
specified in Section 5.01, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Bank for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to the Bank.

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10.05 Notice of Default. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default, except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Agent for the account of the Banks, unless the Agent shall have
received written notice from a Bank or the Company referring to this Agreement,
describing such Default or Event of Default and stating that such notice is a
"notice of default". The Agent will notify the Banks of its receipt of any such
notice. The Agent shall take such action with respect to such Default or Event
of Default as may be requested by the Majority Banks in accordance with Article
IX; provided, however, that unless and until the Agent has received any such
request, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable or in the best interest of the Banks.

10.06 Credit Decision. Each Bank acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Company and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Bank. Each Bank represents to
the Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Company and its Subsidiaries, and all applicable bank regulatory laws relating
to the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Company and its Subsidiaries
hereunder. Each Bank also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Company.
Except for notices, reports and other documents expressly herein required to be
furnished to the Banks by the Agent, the Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Company which may come into the possession
of any of the Agent-Related Persons.

10.07 Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Banks shall indemnify upon demand the
Agent-Related Persons (to the extent not reimbursed by or on behalf of the
Company and without limiting the obligation of the Company to do so), pro rata,
from and against any and all Indemnified Liabilities (excluding any losses
suffered by the Agent as a result of the Borrower's failure to pay fee owing to
the Agent); provided, however, that no Bank shall be liable for the payment to
the Agent-Related Persons of any portion of such Indemnified Liabilities
resulting solely from such Person's gross negligence or willful misconduct.
Without limitation of the foregoing, each Bank shall reimburse the Agent upon
demand for its ratable share of any costs or out-of-pocket expenses (including
Attorney Costs) incurred by the Agent in connection with the preparation,
execution, delivery, administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or

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legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that the Agent is not reimbursed for such expenses by or on
behalf of the Company. The undertaking in this Section shall survive the
payment of all Obligations hereunder and the resignation or replacement of the
Agent.

10.08 Agent in Individual Capacity. BofA and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though BofA were not the Agent hereunder and
without notice to or consent of the Banks. The Banks acknowledge that, pursuant
to such activities, BofA or its Affiliates may receive information regarding the
Company or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Company or such Subsidiary) and
acknowledge that the Agent shall be under no obligation to provide such
information to them. With respect to its Loans, BofA shall have the same rights
and powers under this Agreement as any other Bank and may exercise the same as
though it were not the Agent, and the terms "Bank" and "Banks" include BofA in
its individual capacity.

10.09 Successor Agent. The Agent may, and at the request of the Majority
Banks shall, resign as Agent upon 30 days' notice to the Banks. If the Agent
resigns under this Agreement, the Majority Banks shall appoint from among the
Banks a successor agent for the Banks which successor agent shall be approved by
the Company. If no successor agent is appointed prior to the effective date of
the resignation of the Agent, the Agent may appoint, after consulting with the
Banks and the Company, a successor agent from among the Banks. Upon the
acceptance of its appointment as successor agent hereunder, such successor agent
shall succeed to all the rights, powers and duties of the retiring Agent and the
term "Agent" shall mean such successor agent and the retiring Agent's
appointment, powers and duties as Agent shall be terminated. After any retiring
Agent's resignation hereunder as Agent, the provisions of this Article X and
Sections 11.04 and 11.05 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Agent under this Agreement. If no
successor agent has accepted appointment as Agent by the date which is 30 days
following a retiring Agent's notice of resignation, the retiring Agent's
resignation shall nevertheless thereupon become effective and the Banks shall
perform all of the duties of the Agent hereunder until such time, if any, as the
Majority Banks appoint a successor agent as provided for above.

10.10 Withholding Tax. (a) If any Bank is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Bank claims
exemption from, or a reduction of, U.S. withholding tax under Sections 1441 or
1442 of the Code, such Bank agrees with and in favor of the Agent and the
Company, to deliver to the Agent and the Company:

(i) if such Bank claims an exemption from, or a reduction of,
withholding tax under a United States tax treaty, two properly completed
and executed copies of IRS Form 1001 before the payment of any interest in
the first calendar year and before the payment of any interest in each
third succeeding calendar year during which interest may be paid under this
Agreement;

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(ii) if such Bank claims that interest paid under this Agreement
is exempt from United States withholding tax because it is effectively
connected with a United States trade or business of such Bank, two properly
completed and executed copies of IRS Form 4224 before the payment of any
interest is due in the first taxable year of such Bank and in each
succeeding taxable year of such Bank during which interest may be paid
under this Agreement; and

(iii) such other form or forms as may be required under the Code
or other laws of the United States as a condition to exemption from, or
reduction of, United States withholding tax.

Such Bank agrees to promptly notify the Agent and the Company of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction.

(b) If any Bank claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form 1001 and
such Bank sells, assigns, grants a participation in, or otherwise transfers all
or part of the Obligations of the Company to such Bank, such Bank agrees to
notify the Agent and the Company of the percentage amount in which it is no
longer the beneficial owner of Obligations of the Company to such Bank. To the
extent of such percentage amount, the Agent and the Company will treat such
Bank's IRS Form 1001 as no longer valid.

(c) If any Bank claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent sells, assigns, grants a
participation in, or otherwise transfers all or part of the Obligations of the
Company to such Bank, such Bank agrees to undertake sole responsibility for
complying with the withholding tax requirements imposed by Sections 1441 and
1442 of the Code.

(d) If any Bank is entitled to a reduction in the applicable
withholding tax, the Agent or the Company may withhold from any interest payment
to such Bank an amount equivalent to the applicable withholding tax after taking
into account such reduction. However, if the forms or other documentation
required by subsection (a) of this Section are not delivered to the Agent or the
Company, then the Agent or the Company may withhold from any interest payment to
such Bank not providing such forms or other documentation an amount equivalent
to the applicable withholding tax imposed by Sections 1441 and 1442 of the Code,
without reduction.

(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent or the Company did
not properly withhold tax from amounts paid to or for the account of any Bank
(because the appropriate form was not delivered or was not properly executed, or
because such Bank failed to notify the Agent or the Company of a change in
circumstances which rendered the exemption from, or reduction of, withholding
tax ineffective, or for any other reason) such Bank shall indemnify the Agent
and the Company fully for all amounts paid, directly or indirectly, by the Agent
or the Company as tax or otherwise, including penalties and interest, and
including any taxes imposed by any jurisdiction on the amounts

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payable to the Agent or the Company under this Section, together with all costs
and expenses (including Attorney Costs). The obligation of the Banks under
this subsection shall survive the payment of all Obligations and the
resignation or replacement of the Agent.

ARTICLE XI

MISCELLANEOUS

11.01 Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Company or any applicable Subsidiary therefrom, shall be
effective unless the same shall be in writing and signed by the Majority Banks
(or by the Agent at the written request of the Majority Banks) and the Company
or any Subsidiary Guarantor, as applicable, and acknowledged by the Agent, and
then any such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given; provided, however, that no such
waiver, amendment, or consent shall, unless in writing and signed by all the
Banks and the Company and acknowledged by the Agent, do any of the following:

(a) increase or extend the Commitment of any Bank (or reinstate
any Commitment terminated pursuant to Section 9.02);

(b) postpone or delay any date fixed by this Agreement or any
other Loan Document for any payment of principal, interest (other than interest
payable solely as a result of Section 2.12(c)), fees or other amounts due to the
Banks (or any of them) hereunder or under any other Loan Document;

(c) reduce the principal of, or the rate of interest (other than
interest payable solely as a result of Section 2.12(c)) specified herein on any
Loan, or (subject to clause (ii) below) any fees or other amounts payable
hereunder or under any other Loan Document;

(d) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Loans which is required for the Banks or any of
them to take any action hereunder;

(e) release (other than a release provided for in the last
paragraph of Section 8.02) any Subsidiary Guarantor from the Subsidiary Guaranty
Agreement; or

(f) amend the definition of "Majority Banks" , this Section, or
Section 2.16, or any provision herein providing for consent or other action by
all Banks;

and, provided further, that (i) no amendment, waiver or consent shall, unless
in writing and signed by the Agent in addition to the Majority Banks or all the
Banks, as the case may be, affect the rights or duties of the Agent under this
Agreement or any other Loan Document, and (ii) the Fee Letters

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may be amended, or rights or privileges thereunder waived, in a writing
executed by the parties thereto.

11.02 Notices.

(a) All notices, requests, consents, approvals, waivers and other
communications shall be in writing (including, unless the context expressly
otherwise provides, by facsimile transmission, provided that any matter
transmitted by the Company by facsimile (i) shall be immediately confirmed by a
telephone call to the recipient at the number specified on Schedule 11.02, and
(ii) shall be followed promptly by delivery of a hard copy original thereof) and
mailed, faxed or delivered, to the address or facsimile number specified for
notices on Schedule 11.02; or, as directed to the Company or the Agent, to such
other address as shall be designated by such party in a written notice to the
other parties, and as directed to any other party, at such other address as
shall be designated by such party in a written notice to the Company and the
Agent.

(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile
machine, respectively, or if mailed, upon the third Business Day after the date
deposited into the U.S. mail, or if delivered, upon delivery; except that
notices pursuant to Article II or X to the Agent shall not be effective until
actually received by the Agent.

(c) Any agreement of the Agent and the Banks herein to receive
certain notices by telephone or facsimile is solely for the convenience and at
the request of the Company. The Agent and the Banks shall be entitled to rely
on the authority of any Person purporting to be a Person authorized by the
Company to give such notice and the Agent and the Banks shall not have any
liability to the Company or other Person on account of any action taken or not
taken by the Agent or the Banks in reliance upon such telephonic or facsimile
notice. The obligation of the Company to repay the Loans shall not be affected
in any way or to any extent by any failure by the Agent and the Banks to receive
written confirmation of any telephonic or facsimile notice or the receipt by the
Agent and the Banks of a confirmation which is at variance with the terms
understood by the Agent and the Banks to be contained in the telephonic or
facsimile notice.

11.03 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Agent or any Bank, any right, remedy,
power or privilege hereunder, shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege.

11.04 Costs and Expenses. The Company shall:

(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse the Agent promptly after demand (subject to
subsection 5.01(f)) for all reasonable out-of-pocket costs and expenses incurred
by the Agent in connection with the development, preparation, delivery,
administration and execution of, and any amendment, supplement, waiver or

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modification to (in each case, whether or not consummated), this Agreement, any
Loan Document and any other documents prepared in connection herewith or
therewith, and the consummation of the transactions contemplated hereby and
thereby, including reasonable Attorney Costs incurred by the Agent with respect
thereto; and

(b) pay or reimburse the Agent, the Arranger and each Bank
promptly after demand (subject to subsection 5.01(f)) for all reasonable
out-of-pocket costs and expenses (including Attorney Costs) incurred by them in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or any other Loan Document during the
existence of an Event of Default or after acceleration of the Loans (including
in connection with any "workout" or restructuring regarding the Loans, and
including in any Insolvency Proceeding or appellate proceeding).

11.05 Company Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Company shall indemnify, defend and
hold the Agent-Related Persons, and each Bank and each of its respective
officers, directors, employees, agents and attorneys-in-fact (each, an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including at any time following
repayment of the Loans and the termination, resignation or replacement of the
Agent or replacement of any Bank) be imposed on, incurred by or asserted
against any such Person in any way relating to or arising out of this Agreement
or any Loan Document, or the transactions contemplated hereby, or any action
taken or omitted by any such Person under or in connection with any of the
foregoing, including with respect to any investigation, litigation or proceeding
(including any Insolvency Proceeding or appellate proceeding) related to or
arising out of this Agreement or the Loans or the use of the proceeds thereof,
or related to any Offshore Currency transactions entered into in connection
herewith, whether or not any Indemnified Person is a party thereto (all the
foregoing, collectively, the "Indemnified Liabilities"); provided, that the
Company shall have no obligation hereunder to any Indemnified Person with
respect to Indemnified Liabilities to the extent resulting from the gross
negligence or willful misconduct of such Indemnified Person. The agreements in
this Section shall survive payment of all other Obligations.

11.06 Payments Set Aside. To the extent that the Company makes a payment
to the Agent or the Banks, or the Agent or the Banks exercise their right of
set-off, and such payment or the proceeds of such set-off or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required (including pursuant to any settlement entered into by the
Agent or such Bank in its discretion) to be repaid to a trustee, receiver or any
other party, in connection with any Insolvency Proceeding or otherwise, then (a)
to the extent of such recovery the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Bank severally agrees to pay to the Agent upon demand its pro rata share of
any amount so recovered from or repaid by the Agent.

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11.07 Successors and Assigns. The provisions of this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Company may not assign or transfer any
of its rights or obligations under this Agreement without the prior written
consent of the Agent and each Bank.

11.08 Assignments, Participations, etc.

(a) Any Bank may, with the written consent of the Company at all
times other than during the existence of an Event of Default and the Agent,
which consents shall not be unreasonably withheld, at any time assign and
delegate to one or more Eligible Assignees (provided that no written consent of
the Company or the Agent shall be required in connection with any assignment and
delegation by a Bank to an Eligible Assignee that is an Affiliate of such Bank)
(each an "Assignee") all, or any ratable part of all, of the Loans, the
Commitments and the other rights and obligations of such Bank hereunder, in a
minimum amount of $5,000,000; provided, however, that the Company and the Agent
may continue to deal solely and directly with such Bank in connection with the
interest so assigned to an Assignee until (i) written notice of such assignment,
together with payment instructions, addresses and related information with
respect to the Assignee, shall have been given to the Company and the Agent by
such Bank and the Assignee; (ii) such Bank and its Assignee shall have delivered
to the Company and the Agent an Assignment and Acceptance in the form of Exhibit
11.08 ("Assignment and Acceptance") together with any Note or Notes subject to
such assignment and (iii) the assignor Bank or Assignee has paid to the Agent a
processing fee in the amount of $3,500.

(b) From and after the date that the Agent notifies the assignor
Bank that it has received (and provided its consent with respect to) an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Bank under
the Loan Documents, and (ii) the assignor Bank shall, to the extent that rights
and obligations hereunder and under the other Loan Documents have been assigned
by it pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Loan Documents.

(c) Within five Business Days after its receipt of notice by the
Agent that it has received an executed Assignment and Acceptance and payment of
the processing fee, (and provided that it consents to such assignment in
accordance with subsection 11.08(a)), the Company shall execute and deliver to
the Agent, new Notes evidencing such Assignee's assigned Loans and Commitment
and, if the assignor Bank has retained a portion of its Loans and its
Commitment, replacement Notes in the principal amount of the Loans retained by
the assignor Bank (such Notes to be in exchange for, but not in payment of, the
Notes held by such Bank). Immediately upon each Assignee's making its
processing fee payment under the Assignment and Acceptance, this Agreement shall
be deemed to be amended to the extent, but only to the extent, necessary to
reflect the addition of the Assignee and the resulting adjustment of the
Commitments arising therefrom. The Commitment allocated to each Assignee shall
reduce such Commitments of the assigning Bank pro tanto. Unless the Company
shall otherwise agree, the Agent shall not deliver any new Notes

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executed by the Company unless the Agent shall have received the old Notes to
be replaced or customary indemnification in favor of the Agent and the Company
with respect to lost or destroyed notes. Such old Notes shall be promptly
returned to the Company.

(d) Any Bank may at any time sell to one or more commercial banks
or other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loans, the Commitment of that Bank and the other interests of
that Bank or Designated Bidder (the "Originator") hereunder and under the other
Loan Documents; provided, however, that (i) the Originator's obligations under
this Agreement shall remain unchanged, (ii) the Originator shall remain solely
responsible for the performance of such obligations, (iii) the Company and the
Agent shall continue to deal solely and directly with the Originator in
connection with the Originator's rights and obligations under this Agreement and
the other Loan Documents, and (iv) no Bank shall transfer or grant any
participating interest under which the Participant has rights to approve any
amendment to, or any consent or waiver with respect to, this Agreement or any
other Loan Document, except to the extent such amendment, consent or waiver
would require unanimous consent of the Banks as described in the first proviso
to Section 11.01. In the case of any such participation, the Participant shall
be entitled to the benefit of Sections 4.01, 4.03 and 11.05 as though it were
also a Bank or Designated Bidder (as the case may be) hereunder.
Notwithstanding the immediately preceding sentence, all amounts payable by the
Company or any Subsidiary under this Agreement and each other Loan document
shall be determined as if no such participation had been sold.

(e) Notwithstanding any other provision in this Agreement, any
Bank or Designated Bidder may at any time create a security interest in, or
pledge, all or any portion of its rights under and interest in this Agreement
and the Note held by it in favor of any Federal Reserve Bank in accordance with
Regulation A of the FRB or U.S. Treasury Regulation 31 CFR Section 203.14, and
such Federal Reserve Bank may enforce such pledge or security interest in any
manner permitted under applicable law. Notwithstanding any such pledge, such
Bank shall remain liable to the Company and the Issuing Bank as if such pledge
had not been made. In the event of any enforcement or proposed enforcement of
such pledge, the Company shall have the right to replace such Bank pursuant to
the provisions of Section 4.08.

11.09 Designated Bidders. Any Bank may designate one Designated Bidder
to have a right to offer and make Bid Loans pursuant to Section 2.06; provided,
however, that (i) each such Bank making any such designation shall retain the
right to make Bid Loans, and (ii) the parties to each such designation shall
execute and deliver to the Agent a Designation Agreement. Upon its receipt of an
appropriately completed Designation Agreement executed by a designating Bank and
a designee representing that it is a Designated Bidder, the Agent will accept
such Designation Agreement and give prompt notice thereof to the Company,
whereupon such designation of such Designated Bidder shall become effective and
shall become a party to this Agreement as a "Designated Bidder."

11.10 Confidentiality. Each Bank and Designated Bidder agrees to take
and to cause its Affiliates to take normal and reasonable precautions and
exercise due care to maintain the

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confidentiality of all information identified as "confidential" or "secret" by
the Company and provided to it by the Company or any Subsidiary, or by the
Agent on the Company's or such Subsidiary's behalf, under this Agreement or any
other Loan Document, and neither it nor any of its Affiliates shall use any
such information other than in connection with or in enforcement of this
Agreement and the other Loan Documents or in connection with other business now
or hereafter existing or contemplated with the Company or any Subsidiary;
except to the extent such information (i) was or becomes generally available to
the public other than as a result of disclosure by the Bank or Designated
Bidder, or (ii) was or becomes available on a non-confidential basis from a
source other than the Company, provided that such source is not bound by a
confidentiality agreement with the Company known to the Bank or Designated
Bidder; provided, however, that any Bank or Designated Bidder may disclose such
information (A) at the request or pursuant to any requirement of any
Governmental Authority to which the Bank or Designated Bidder is subject or in
connection with an examination of such Bank or Designated Bidder by any such
authority; (B) pursuant to subpoena or other court process; (C) when required
to do so in accordance with the provisions of any applicable Requirement of
Law; (D) to the extent reasonably required in connection with any litigation or
proceeding to which the Agent, any Bank, Designated Bidder or their respective
Affiliates may be party; (E) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Loan Document; (F)
to such Bank's or Designated Bidder's independent auditors and other
professional advisors; (G) to any Participant or Assignee, actual or potential,
provided that such Person agrees in writing to keep such information
confidential to the same extent required of the Banks hereunder; (H) as to any
Bank or Designated Bidder or its Affiliate, as expressly permitted under the
terms of any other document or agreement regarding confidentiality to which the
Company or any Subsidiary is party or is deemed party with such Bank or
Designated Bidder or such Affiliate; and (I) to its Affiliates, provided such
Affiliate agrees to use such information solely in connection with this
Agreement and agrees in writing to keep such information confidential.

11.11 Set-off. In addition to any rights and remedies of the Banks
provided by law, if an Event of Default exists or the Loans have been
accelerated, each Bank and Designated Bidder is authorized at any time and from
time to time, without prior notice to the Company, any such notice being waived
by the Company to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held by, and other indebtedness at any time owing by, such Bank or
Designated Bidder to or for the credit or the account of the Company against any
and all Obligations owing to such Bank or Designated Bidder, now or hereafter
existing, irrespective of whether or not the Agent or such Bank or Designated
Bidder shall have made demand under this Agreement or any Loan Document and
although such Obligations may be contingent or unmatured. Each Bank and
Designated Bidder agrees promptly to notify the Company and the Agent after any
such set-off and application made by such Bank or Designated Bidder; provided,
however, that the failure to give such notice shall not affect the validity of
such set-off and application.

11.12 Automatic Debits of Fees. With respect to any commitment fee,
arrangement fee, or other fee, or any other cost or expense (excluding Attorney
Costs) due and payable to the Agent, BofA or the Arranger under the Loan
Documents, the Company hereby irrevocably authorizes BofA

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to debit any deposit account of the Company with BofA in an amount such that
the aggregate amount debited from all such deposit accounts does not exceed
such fee or other cost or expense. If there are insufficient funds in such
deposit accounts to cover the amount of the fee or other cost or expense then
due, such debits will be reversed (in whole or in part, in BofA's sole
discretion) and such amount not debited shall be deemed to be unpaid. No such
debit under this Section shall be deemed a set-off.

11.13 Notification of Addresses, Lending Offices, Etc. Each Bank and
Designated Bidder shall notify the Agent in writing of any changes in the
address to which notices to the Bank and Designated Bidder should be directed,
of addresses of any Lending Office, of payment instructions in respect of all
payments to be made to it hereunder and of such other administrative information
as the Agent shall reasonably request.

11.14 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of said counterparts taken together shall be deemed to
constitute but one and the same instrument.

11.15 Severability. The illegality or unenforceability of any provision
of this Agreement or any instrument or agreement required hereunder shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement required hereunder.

11.16 No Third Parties Benefited. This Agreement is made and entered
into for the sole protection and legal benefit of the Company, the Banks, the
Designated Bidders, the Agent and the Agent-Related Persons, and their permitted
successors and assigns, and no other Person shall be a direct or indirect legal
beneficiary of, or have any direct or indirect cause of action or claim in
connection with, this Agreement or any of the other Loan Documents.

11.17 Governing Law and Jurisdiction.

(a) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED THAT THE AGENT
AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

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CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT
RELATED HERETO. THE COMPANY, THE AGENT, THE DESIGNATED BIDDERS AND THE BANKS
EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH
MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.

11.18 Waiver of Jury Trial. THE COMPANY, THE BANKS AND THE AGENT EACH
WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST
ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE
BANKS, THE DESIGNATED BIDDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR
CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS TO ANY ACTION,
COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR
ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.

11.19 Judgment. If, for the purposes of obtaining judgment in any court,
it is necessary to convert a sum due hereunder or any other Loan Document in one
currency into another currency, the rate of exchange used shall be that at which
in accordance with normal banking procedures the Agent could purchase the first
currency with such other currency on the Business Day preceding that on which
final judgment is given. The obligation of the Company in respect of any such
sum due from it to the Agent hereunder or under the other Loan Documents shall,
notwithstanding any judgment in a currency (the "Judgment Currency") other than
that in which such sum is denominated in accordance with the applicable
provisions of this Agreement (the "Agreement Currency"), be discharged only to
the extent that on the Business Day following receipt by the Agent of any sum
adjudged to be so due in the Judgment Currency, the Agent may in accordance with
normal banking procedures purchase the Agreement Currency with the Judgment
Currency. If the amount of the Agreement Currency so purchased is less than the
sum originally due to the Agent in the Agreement Currency, the Company agrees,
as a separate obligation and notwithstanding any such judgment, to indemnify the
Agent or the Person to whom such obligation was owing against such loss. If the
amount of the Agreement currency so purchased is greater than the sum originally
due to the Agent in such currency, the Agent agrees to return the amount of any
excess to the Company (or to any other Person who may be entitled thereto under
applicable law).

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11.20 Senior Debt. The Company represents and warrants that the
Obligations hereunder constitute "Senior Indebtedness" under the "Bank Credit
Agreement" as such terms are defined in the Subordinated Debt Indenture;
provided, however, that if for any reason such Indebtedness or any portion
thereof does not constitute such Senior Indebtedness under the Bank Credit
Agreement, the Company, to such extent, hereby designates the Obligations
hereunder as "Designated Senior Indebtedness" pursuant to the terms of the
Subordinated Debt Indenture.

11.21 Entire Agreement. This Agreement, together with the other Loan
Documents supersedes the commitment letter dated June 4, 1996 from BofA and the
Arranger and embodies the entire agreement and understanding among the Company,
the Banks and the Agent, and supersedes all prior or contemporaneous agreements
and understandings of such Persons, verbal or written, relating to the subject
matter hereof and thereof.

94
<PAGE> 102

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Chicago, Illinois by their proper and duly
authorized officers as of the day and year first above written.

IDEX CORPORATION

By: Douglas C. Lennox
----------------------------------
Title: Treasurer
-------------------------------

Copy to:
Kohlberg Kravis Roberts & Co.
9 West 57th Street
New York, NY 10019
Attention: Michael T. Tokarz

BANK OF AMERICA ILLINOIS, AS AGENT

By: David A. Johanson
----------------------------------
David A. Johanson

Title: Vice President
-------------------------------

S-1

<PAGE> 103

BANK OF AMERICA ILLINOIS, AS A BANK

By:
----------------------------------

Title: Sr. V.P.
-------------------------------

S-2

<PAGE> 104

BANK OF SCOTLAND

By: Catherine M. Oniffrey
-----------------------------------
Catherine M. Oniffrey

Title: Vice President
--------------------------------

S-3

<PAGE> 105
NATIONAL CITY BANK

By: Brian J. Cullina
-----------------------------
Brian J. Cullina

Title: Vice President
--------------------------

S-4
<PAGE> 106
PNC BANK, NATIONAL ASSOCIATION

By: Karen C. Brogan
------------------------------

Title: Commercian Banking Officer
---------------------------

S-5
<PAGE> 107
UNION BANK OF CALIFORNIA, N.A.
(SUCCESSOR IN INTEREST TO UNION BANK)

By: NanBrusati Dias
---------------------------------------

Title: Vice President and District Manager
------------------------------------

S-6
<PAGE> 108
UNITED STATES NATIONAL BANK
OF OREGON

By: Tom Lee
-----------------------------

Title: Vice President
--------------------------

S-7
<PAGE> 109
THE HARRIS TRUST AND SAVINGS
BANK CO.

By: Frank Pagura
-----------------------------

Title: V. P.
--------------------------

S-8
<PAGE> 110

SCHEDULE 2.01

COMMITMENTS
AND PRO RATA SHARES

Pro Rata
Bank Commitment Share
---- ----------- -----
<S> <C> <C>

Bank of America Illinois $ 66,000,000 26.4%
PNC Bank, National Association 40,000,000 16.0%
Harris Trust and Savings Bank 33,000,000 13.2%
Union Bank of California, N.A. 33,000,000 13.2%
U.S. National Bank of Oregon 33,000,000 13.2%
National City Bank 30,000,000 12.0%
Bank of Scotland 15,000,000 6.0%
----------- -----
TOTAL $250,000,000 100%

</TABLE>

<PAGE> 111
Schedule 6.05

Litigation

None.

<PAGE> 112

Schedule 6.07

ERISA

None.

<PAGE> 113

Schedule 6.11

Permitted Liabilities

None.

3
<PAGE> 114

Schedule 6.12

Environmental Matters

None.

<PAGE> 115
Schedule 6.14

Existing Subsidiaries

Jurisdiction of
Incorporation Ownership
--------------- ---------

IDEX Corporation Delaware 100%

Band-It-IDEX, Inc. Delaware 100%
Band-It Company, Ltd. Great Britain 100%
Band-It Clamps (Asia) Pte. Ltd. Singapore 90%

Corken, Inc. Delaware 100%

Hale Products, Inc. Pennsylvania 100%
Hale Products Europe GmbH Germany 100%
Dunja Verwaltugsgesellschaft mbH Germany 100%
Lukas Hydraulik GmbH Germany 100%
Godiva Products Ltd. Great Britain 100%
Seithal Limited Great Britain 100%
Godiva Group Limited Great Britain 100%
Ginswat Ltd. Hong Kong 100%

Lubriquip, Inc. Delaware 100%
KLS Lubriquip, Inc. Wisconsin 100%

Micropump, Inc. Delaware 100%
MM Holding Co. Delaware 100%
Consis, LLC (50% owned) Washington 100%
Micropump Limited Great Britain 100%

Pulsafeeder, Inc. Delaware 100%
Pulsafeeder Pte Ltd. Singapore 100%

Signfix Holdings Limited Great Britain
Signfix Limited Great Britain
Tespa France SARL France
Tespa GmbH Germany

Strippit, Inc. Delaware 100%
Strippit S.A. France 100%
Strippit Ltd. Great Britain 100%

Vibratech, Inc. Delaware 100%

<PAGE> 116

Viking Pump, Inc. Delaware 100%
Viking Pump International, Inc. Delaware 100%
Viking Pump (Europe) Ltd. Ireland 100%
Johnson Pump (UK) Ltd. Great Britain 100%
Viking Pump of Canada Inc. Ontario 100%
Atlas Pump and Machine Co., Inc. Ontario

Warren Rupp, Inc. Delaware 100%
Warren Rupp (Europe) Ltd. Ireland 100%

IDEX Foreign Sales Corp. Barbados 100%

Dormant Corporations
--------------------

Name Parent Organized Note
- ---- ------ --------- ----

KLS International Corp. Lubriquip, Inc. Del.
Strippit International, Inc. Strippit, Inc. Del.
Hale Products International, Inc. Hale Products, Inc. U.S.V.I.
Hale Products Group, Ltd. Godiva Products Ltd. U.K.
Hale Products Europe Ltd. Godiva Products Ltd. U.K.
Hale Products U.K. Ltd. Godiva Products Ltd. U.K.
Godiva Emergency Products Ltd. Seithal Ltd. U.K.
Godiva Group Limited Godiva Group Limited U.K.
Trinity Hathaway Ltd. Godiva Group Limited U.K.

<PAGE> 117

Schedule 6.15

Insurance Matters

None.

<PAGE> 118

Schedule 8.01

Permitted Liens

1. Liens relating to a capital lease of Corken, Inc.'s office and
manufacturing facility securing obligations in a principal amount not exceeding
$3,000,000 under and pursuant to that certain Lease between Corken, Inc. and
3805 General Partnership dated as of August 28, 1990.

2. Liens on certain assets of Pulsafeeder, Inc. in connection with an
Industrial Revenue Bond securing obligations not exceeding $150,000.

<PAGE> 119

Schedule 8.04

Loans & Investments

1. 50% interest in Consis L.L.C. owned by M.M. Holding Co. currently
carried on the financial statements at $268,000.

<PAGE> 120

Schedule 8.05

Permitted Indebtedness

1. Capital lease obligations of Corken, Inc.'s in connection with the
lease of its office and manufacturing facility in a principal amount not
exceeding $3,000,000 under and pursuant to that certain Lease between Corken,
Inc. and 3805 General Partnership dated as of August 28, 1990.

2. Indebtedness of Pulsafeeder, Inc. in connection with an Industrial
Revenue Bond in a principal amount not exceeding $150,000.

3. Indebtedness of Dunja Verwaltugsgesellschaft mbH in connection with a
credit facility with Bank of America NT & SA (Frankfurt Branch) ("BofA
Frankfurt") in an aggregate principal amount not exceeding DM52,500,000, as
described in that certain letter agreement dated September 29, 1995 from BofA
Frankfurt.

4. Guaranty of IDEX Corporation in connection with the Indebtedness
described in item 3 above.

<PAGE> 121

Schedule 8.07

Contingent Obligations

1. Guaranty of IDEX Corporation described in item 4 of Schedule 8.05.

<PAGE> 122

SCHEDULE 11.02

OFFSHORE AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES

BANK OF AMERICA ILLINOIS, as Agent

Bank of America Illinois
Attention: David Graham, Vice President
Telephone: (312) 828-7933
Facsimile: (312) 974-9102

AGENT'S PAYMENT OFFICE:

231 South LaSalle St.
8th Floor
Chicago, Illinois 60697

BANK OF AMERICA ILLINOIS, as a Bank

Domestic and Offshore Lending Office:

Notices (other than Borrowing notices and Notices of
Conversion/Continuation):

Bank of America Illinois
Attention: Eileen Sachanda
2850 West Golf Road
Rolling Meadows, Illinois 60008

<PAGE> 123

BANK OF SCOTLAND

181 West Madison Street
Suite 4710
Chicago, Illinois 60602
Attn: Colin Ferguson, Vice President
Telephone: (312) 263-4054
Facsimile: (312) 263-1143

HARRIS TRUST AND SAVINGS BANK

111 West Monroe Street
Chicago, Illinois 60690
Attn: Frank Pagura, Vice President
Telephone: (312) 461-2781
Facsimile: (312) 987-4856

NATIONAL CITY BANK

National City Center
1900 East 9th Street
Cleveland, Ohio 44114-3484
Attn: Brian Cullina, Vice President
Telephone: (216) 575-2822
Facsimile: (216) 575-9396

PNC BANK, NATIONAL ASSOCIATION

500 West Madison Street
Suite 3140
Chicago, Illinois 60661
Attn: Karen Brogan, Commercial Banking Officer
Telephone: (312) 906-3457
Facsimile: (312) 906-3420

<PAGE> 124

UNION BANK OF CALIFORNIA

350 California Street
San Francisco, California 94104
Attn: Nan Brusati Dias, Multinational Department
Telephone: (415) 705-7050
Facsimile: (415) 705-7046

UNITED STATES NATIONAL BANK OF OREGON

555 Southwest Oak Street
PL-4
Portland, Oregon 97204
Attn: Thomas Lee, Vice President
Telephone: (503) 275-6381
Facsimile: (503) 275-4267

<PAGE> 125

EXHIBIT 1.01A

FORM OF
AMENDED AND RESTATED PLEDGE AGREEMENT

This Amended and Restated Pledge Agreement (as amended, restated,
supplemented, renewed or otherwise modified from time to time, this
"Agreement") is entered into as of July 17, 1996, by IDEX Corporation, a
Delaware corporation (the "Company"), and any Subsidiary which may hereafter
become a party hereto in accordance with Section 6.5 hereof (each a "Pledgor"
and collectively, the "Pledgors"), in favor of Bank of America Illinois, as
Agent (in such capacity, the "Agent") for itself and the financial institutions
from time to time party to the Credit Agreement described below (the "Banks").

RECITALS:

A. The Company, the Agent and the Banks entered into that certain
Third Amended and Restated Credit Agreement dated as of July 17, 1996. The
Third Amended and Restated Credit Agreement as now in effect or hereafter
extended, renewed, modified, supplemented, amended or restated is hereinafter
called the "Credit Agreement".

B. The Banks are willing to continue to make certain Loans to the
Company and the Issuing Bank is willing to continue to issue Letters of Credit
for the account of the Company as provided in the Credit Agreement on the
condition (among others) that the Pledgors enter into this Agreement.

C. The Company has previously entered into pledges (See Recital D
below) pursuant to that certain Credit Agreement, among the Company, Agent and
various banking institutions, dated January 22, 1988 (herein, as amended by the
First Amendment dated as of May 22, 1989, a Letter Agreement dated as of May 7,
1991, the Amended and Restated Credit Agreement dated as of May 4, 1992, the
Second Amended and Restated Credit Agreement dated as of January 29, 1993,
which in turn was amended by the First Amendment dated as of May 23, 1994, the
Second Amendment dated as of October 24, 1994, the Third Amendment dated as of
February 28, 1995, the Fourth Amendment dated November 1, 1995 and the Fifth
Amendment dated December 22, 1995), and such pledges are hereby deemed to be
amended and restated by this Agreement.

D. The Company is party to that certain Senior Pledge Agreement,
dated January 22, 1988, by and between the Company and Bank of America Illinois
(successor to Continental Illinois National Bank and Trust Company of Chicago).
That certain Senior Pledge Agreement was subsequently amended on the following
dates: May 7, 1991, May 4, 1992, October 24, 1994, and November 1, 1995.
Pursuant to these amendments, capital stock and intercompany notes of the
following subsidiaries were pledged by the Company: Corken, Inc. (successor to
CIC Acquisition Corp.); Pulsafeeder, Inc. (successor to PLF Acquisition
Corporation and MCL Acquisition

-1-
<PAGE> 126
Corporation); Hale Products, Inc.; and Micropump, Inc. The foregoing Senior
Pledge Agreement, as amended, is hereinafter referred to as the "Original
Pledge Agreement".

E. In order to induce the Banks to continue to make such Loans
available to the Company and to induce the Issuing Bank to continue to issue
such Letters of Credit for the account of the Company, and for other valuable
consideration, the Company is required to execute and deliver this Agreement
and to grant to Agent under this Agreement a continuing Security Interest in

(1) all Pledged Notes; and

(2) all Pledged Shares.

F. Pledgor hereby agrees that the Original Pledge Agreement is
hereby amended and restated in its entirety as follows:

ARTICLE I
DEFINITIONS

1.1. Certain Terms. The following terms (whether or not underscored)
when used in this Agreement shall have the following meanings (such definitions
to be equally applicable to the singular and plural forms thereof):

"Agent" shall have the meaning provided in the preamble hereto.

"Banks" shall have the meaning provided in the preamble hereto.

"Company"shall have the meaning provided in preamble hereto.

"Collateral" shall have the meaning provided in Section 2.1 below.

"Credit Agreement" shall have the meaning provided in Recital A
hereto.

"Default" shall mean any Event of Default or any event or condition
which, with notice or lapse of time or both, would constitute an Event of
Default.

"Distributions" shall mean all stock dividends, liquidating dividends,
shares of stock resulting from stock splits, reclassifications, warrants,
options, non-cash dividends and other distributions on or with respect to any
shares of capital stock whether similar or dissimilar to the foregoing but
shall not mean Dividends as that term is defined herein.

"Dividends" shall mean cash dividends and cash distributions made out
of capital surplus.

-2-
<PAGE> 127
"Instrument" shall mean any document or writing (whether by formal
agreement, letter or otherwise) under which any obligation is evidenced,
assumed or undertaken, or any right to any security interest is granted or
perfected.

"Instrument executed pursuant hereto" and similar terms shall mean the
Pledged Notes and each Instrument executed and delivered by the Company or any
Subsidiary pursuant to this Agreement, whether or not mentioned herein.

"Intercompany Note" means a promissory note from a Subsidiary of the
Company to the Company in a form satisfactory to Agent and required to be
pledged pursuant to the Agreement.

"Note" shall mean any promissory note of the Company executed and
delivered pursuant to the Credit Agreement to evidence any Loans made
thereunder and any other promissory note of the Company accepted by any Bank in
substitution or replacement therefor.

"Obligations" shall have the meaning ascribed to it in the Credit
Agreement.

"Pledged Notes" shall mean all Intercompany Notes either in the form
as they currently exist and hereafter substantially in the form of Exhibit A
(with only such changes as are agreed to by the Agent) indentified on Schedule
I attached hereto (as the same may be amended from time to time) which are now
being delivered by the Company to Agent or may from time to time hereafter be
delivered by the Company or any Subsidiary for the purpose of pledge under this
Agreement.

"Pledged Property" shall mean the Pledged Notes and/or the Pledged
Shares.

"Pledged Shares" shall mean the certificates representing the shares
of the capital stock as identified on Schedule II attached hereto (as the same
may be amended from time to time) which are now being delivered by the Company
to Agent or may from time to time hereafter be delivered by the Company or any
Subsidiary for the purpose of pledge under this Agreement.

"Pledgor" shall have the meaning provided in the preamble hereto.

"Ratably" or "Ratable Distribution" shall mean, in the context of a
distribution of Collateral or a distribution of proceeds of any of the
Collateral, an allocation of such moneys among the Banks pro rata in accordance
with their respective proportion of the aggregate dollar amount of the
obligations to which the distribution is being applied.

"Security Instrument" shall mean any security agreement, chattel
mortgage, assignment, financing or similar statement or notice, continuation
statement, other agreement or Instrument, or amendment or supplement to any
thereof, providing for, evidencing or perfecting any Security Interest.

-3-
<PAGE> 128
"Security Interest" shall mean any interest in any real or personal
property or fixture which secures payment of performance of any obligation and
shall include any mortgage, lien, encumbrance, charge or other Security
Interest of any kind, whether arising under a Security Instrument or as a
matter of law, judicial process or otherwise.

1.2. Credit Agreement Definitions. Unless otherwise defined herein,
capitalized terms used in this Agreement have the meanings given to such terms
from time to time in the Credit Agreement. References to the Banks or any Bank
herein shall include the Issuing Bank in its capacity as a Bank and as Issuing
Bank.

1.3. References to Parties. References to any party in this
Agreement shall include its permitted successors and assigns.

ARTICLE II
PLEDGE

2.1. Grant of Security Interest. As security for payment of all
Obligations of such Pledgor, each Pledgor hereby ratifies and confirms its
pledge and grant of a security interest pursuant to the Original Pledge
Agreement and hereby pledges, assigns and transfers to Agent and grants to
Agent a continuing security interest in and to the Pledged Property, whether
now or hereafter delivered by such Pledgor to Agent, together with all
Dividends, Distributions, interest and other payments and rights with respect
thereto and all proceeds of any of the foregoing (all of the items referred to
in this Section 2.1 being herein called the "Collateral"). Any Pledged Notes
delivered by each Pledgor to Agent which, notwithstanding any applicable
requirement of this Agreement or the Credit Agreement, were not endorsed by
each Pledgor to the order of Agent, and upon the occurrence of any Event of
Default any other Collateral delivered by each Pledgor to Agent which was not
endorsed by each Pledgor to the order of Agent, may be so endorsed by Agent on
behalf of each Pledgor.

All advances, charges, costs and expenses, including reasonable
attorneys' fees, incurred or paid by Agent in exercising any right, power or
remedy conferred by this Agreement, or in the enforcement hereof or thereof,
shall, to the extent lawful, become a part of the Obligations secured hereby.

2.2. Release of Pledged Property.

(a) In the event that each Pledgor, to the extent
permitted under the Credit Agreement, disposes of all Pledged Shares
issued by any Subsidiary or any Subsidiary disposes of all or
substantially all of its assets then, upon the occurrence of such
disposition and each Pledgor's prepayment of such amounts, if any,
then required by the Banks to be paid on the Obligations, the Pledged
Note issued by such Subsidiary and/or, if applicable, the Pledged
Shares issued by such Subsidiary, shall cease to be Pledged Property
and shall

-4-
<PAGE> 129
be released by the Agent to each Pledgor. Any such release may occur
pursuant to an escrow or other arrangement for a concurrent
disposition and release.

(b) In the event that any Dividend is paid on any Pledged
Shares or any interest or principal is paid on any Pledged Notes at a
time when no Default of the nature referred to in clauses (f) or (g)
of Section 9.01 of the Credit Agreement and no Event of Default has
occurred and is continuing and the proceeds thereof are not applied to
any of the Obligations, such Dividend or interest or principal shall
thereupon cease to be Pledged Property and shall be deemed to be
released by Agent to each Pledgor.

ARTICLE III
CERTAIN UNDERTAKINGS

3.1. Payments of Pledged Notes. Subject to the restrictions of
Section 3.3 below, any Subsidiary which is obligated under any Pledged Note may
prepay such Pledged Note in whole or in part without premium or penalty.

3.2. Quarterly Reports. Each Pledgor shall provide each Bank, as
part of the financial information delivered quarterly pursuant to clause (b) of
Section 7.01 of the Credit Agreement (commencing with the fiscal quarter ending
June 30, 1996), a schedule, in form satisfactory to each Bank, setting forth as
to each Pledged Note on the last day of the fiscal quarter for which such
information is delivered:

(a) its maker, date and original principal amount;

(b) its actual outstanding principal amount on the last
day of such fiscal quarter; and

3.3. Additional Undertakings. Except in connection with any action
permitted by Section 2.2, each Pledgor will not, without the prior written
consent of Agent,

(a) enter into any agreement amending, supplementing or
waiving any provision of any Pledged Note or compromising or releasing
or extending the time for payment of any obligation of the maker
thereunder; or

(b) take or omit to take any action the taking or
omission of which would result in any impairment or alteration of any
obligation of the maker of any Pledged Note.

-5-
<PAGE> 130
ARTICLE IV

WARRANTIES, ETC.

Each Pledgor represents and warrants unto Agent and each Bank that at
the date of each pledge hereunder by each Pledgor to Agent of any Pledged
Property,

(a) Each Pledgor is or will then be the lawful owner of,
and has or will have good and marketable title to (and has or will
have full right and authority to pledge and assign), such Pledged
Property, free and clear of all liens or encumbrances except any lien
or security interest granted pursuant hereto in favor of Agent or
otherwise permitted by the Credit Agreement;

(b) the Pledged Notes then pledged hereunder are in full
force and effect and are enforceable in accordance with their
respective terms, subject as to enforcement only to bankruptcy,
insolvency, reorganization, moratorium or similar laws at the time in
effect affecting the enforceability of the rights of creditors
generally and general principles of equity;

(c) the pledge of the Pledged Property then pledged
hereunder is effective to create a valid first lien on and a first
perfected security interest in such Pledged Property;

(d) in the case of any Pledged Shares, all of such
Pledged Shares have been duly and validly issued, are fully paid and
non-assessable; and

(e) the Pledged Shares constitute the percentage of the
shares of capital stock of the Domestic Subsidiaries specified on
Schedule II hereto or in the supplement pursuant to which such shares
have been pledged.

ARTICLE V
BENEFIT OF PLEDGED SECURITIES, ETC.

5.1. Protect Collateral. Except in connection with any action
permitted by Section 2.2, each Pledgor will not sell, assign, transfer, pledge
or encumber in any other manner the Collateral (except in favor of Agent
hereunder). Each Pledgor will warrant and defend the right and title herein
granted unto Agent in and to the Collateral (and all right, title and interest
represented by the Collateral) against the claims and demands of all Persons
whomsoever except as permitted by the Credit Agreement.

5.2. Stock Powers, Endorsements, etc. Each Pledgor agrees that all
Pledged Notes delivered by each Pledgor pursuant to this Agreement will be duly
endorsed by each Pledgor to the order of Agent and that all Pledged Shares
delivered by each Pledgor pursuant to this Agreement will be accompanied by
duly executed undated blank stock powers. Each Pledgor will, from time to
time, upon request of Agent, promptly execute such endorsements and deliver to
Agent such stock powers

-6-
<PAGE> 131
and similar documents, satisfactory in form and substance to Agent, with
respect to the Collateral as Agent may reasonably request and will, from time
to time, upon request of Agent, after the occurrence and during the continuance
of any Event of Default, promptly transfer any shares which are part of the
Collateral into the name of any nominee designated by Agent.

5.3. Certain Other Agreements Regarding Collateral. Subject to
Section 2.2, each Pledgor will, at all times, keep pledged to Agent pursuant
hereto all of the Pledged Notes, all Distributions, all shares of capital stock
of each Domestic Subsidiary that is a Material Subsidiary existing as of the
date hereto and each Domestic Subsidiary which becomes a Material Subsidiary
after the date hereof, and 65% of shares of capital stock of each direct
Foreign Subsidiary which becomes a Material Subsidiary after the date hereof,
and all other securities, instruments and rights from time to time received by
or distributable to each Pledgor in respect of any Collateral.

Each Pledgor agrees to deliver (properly endorsed where required
hereby or requested by Agent) to Agent:

(a) after, but not prior to, the time that any Default of
the nature referred to in clause (f) or (g) of Section 9.01 of the
Credit Agreement or an Event of Default shall have occurred and be
continuing, promptly upon receipt thereof by each Pledgor and without
any request therefor by Agent, all Dividends, all interest and other
cash payments and all cash proceeds of the Pledged Property and other
Collateral, all of which shall be held by Agent as additional
Collateral for use in accordance with Section 5.5; and

(b) after a Default of the nature referred to in clause
(f) or (g) of Section 9.01 of the Credit Agreement or an Event of
Default shall have occurred, promptly upon request of Agent, such
proxies and other documents as may be necessary to allow Agent to
exercise the voting power with respect to any share of capital stock
included in the Collateral;

provided, however, that unless a Default of the nature referred to in clause
(f) or (g) of Section 9.01 of the Credit Agreement or an Event of Default shall
have occurred and be continuing, each Pledgor shall, subject to Article III, be
entitled:

(c) to exercise as it shall deem fit, but in a manner not
inconsistent with the terms of the Credit Agreement, Loan Document,
any Note or any Instrument executed pursuant thereto, the voting power
and all other incidental rights of ownership with respect to any
Pledged Shares or any Pledged Notes (subject to each Pledgor's
obligation to deliver to Agent such capital stock and Subsidiary Notes
in pledge hereunder); and

(d) to the prompt return from Agent of any and all such
Dividends, all interest and other cash payments and all cash proceeds
of the Pledged Property and other Collateral delivered to the Agent in
accordance with clause (a) of Section 5.3 after payment in full of all
Obligations then due or to become due within 30 days thereafter.

-7-
<PAGE> 132
All Dividends, Distributions, interest and payments which may at any
time and from time to time be held by each Pledgor but which each Pledgor is
then obligated to deliver to Agent, shall, until delivery to Agent, be held by
each Pledgor separate and apart from its other property in trust for Agent.

Agent agrees that unless an Event of Default shall have occurred and
be continuing, Agent shall, upon the written request of each Pledgor, promptly
deliver such proxies and other documents, if any, as shall be reasonably
requested by each Pledgor which are necessary to allow each Pledgor to exercise
voting power with respect to any share of capital stock included in the
Collateral; provided, however, that no vote shall be cast or consent, waiver or
ratification given or action taken by each Pledgor that would impair the
Collateral or be inconsistent with or violate any provision of this Agreement,
the Credit Agreement, Loan Documents, any Note or any Instrument executed
pursuant to the Credit Agreement.

5.4. Actions upon Event of Default. Whenever an Event of Default
shall have occurred and be continuing, Agent shall have all rights and remedies
of a secured party after default under the Uniform Commercial Code as in effect
in the State of Illinois or other applicable law to the extent not inconsistent
with all rights provided hereby. Any notification required by law of intended
disposition by Agent of any of the Collateral shall be deemed reasonably and
properly given if given at least 30 days before such disposition. Without
limitation of the above, Agent may, upon direction of the Majority Banks, from
time to time, before the Obligations shall be declared due and payable, but
only if an Event of Default shall have occurred and be continuing, without
prior notice to each Pledgor, take all or any of the following actions:

(a) transfer all or any part of the Collateral into the
name of Agent or its nominee, with or without disclosing that such
Collateral is subject to the lien and security interest hereunder;

(b) notify the parties obligated on any of the Collateral
to make payment to Agent of any amount due or to become due
thereunder;

(d) endorse any checks, drafts or other writings in each
Pledgor's name to allow collection of the Collateral; and

(e) take control of any proceeds of the Collateral.

Without limitation of the above, Agent may, upon direction of the Majority
Banks, whenever an Event of Default shall have occurred and be continuing, and
the Obligations shall have been declared immediately due and payable, without
prior notice to each Pledgor, take all or any of the following actions:

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<PAGE> 133
(f) transfer all or any part of the Collateral into the
name of Agent or its nominee, with or without disclosing that such
Collateral is subject to the lien and security interest hereunder;

(g) notify the parties obligated on any of the Collateral
to make payment to Agent of any amount due or to become due
thereunder;

(h) enforce collection of any of the Collateral by suit
or otherwise, and surrender, release or exchange all or any part
thereof, or compromise or extend or renew for any period (whether or
not longer than the original period) any obligations of any nature of
any party with respect thereto;

(i) endorse any checks, drafts or other writings in each
Pledgor's name to allow collection of the Collateral;

(j) take control of any proceeds of the Collateral; and

(k) execute (in the name, place and stead of each
Pledgor) endorsements, assignments, stock powers and other instruments
of conveyance or transfer with respect to all or any of the
Collateral.

In furtherance of the foregoing, each Pledgor hereby irrevocably
constitutes and appoints the Agent, as its true and lawful attorney-in-fact
with full power and authority in the name and in the place and stead of each
Pledgor, and in its own name, effective upon the occurrence and during the
continuance of an Event of Default, to file any claims or take any action (in
law or in equity) which Agent may deem desirable to accomplish the purposes of
this Agreement.

Each Pledgor understands that compliance with the federal securities
laws, applicable blue sky or other state securities laws or similar laws
analogous in purpose or effect may strictly limit the course of conduct of
Agent if Agent were to attempt to dispose of all or any part of the Collateral
and may also limit the extent to which or the manner in which any subsequent
transferee of the Collateral may dispose of the same. Accordingly, each
Pledgor agrees that IF ANY COLLATERAL IS SOLD AT ANY PUBLIC OR PRIVATE SALE,
AGENT MAY ELECT TO SELL ONLY TO A BUYER WHO WILL GIVE FURTHER ASSURANCES,
SATISFACTORY IN FORM AND SUBSTANCE TO AGENT, RESPECTING COMPLIANCE WITH THE
REQUIREMENTS OF THE FEDERAL SECURITIES ACT OF 1933, AS AMENDED; AND A SALE
SUBJECT TO SUCH CONDITION SHALL BE DEEMED COMMERCIALLY REASONABLE. Without
limiting the generality of the foregoing, the provisions of this paragraph
would apply if, for example, Agent were to place all or any part of the
Collateral for private placement by an investment banking firm, or if such
investment banking firm purchased all or any part of the Collateral for its own
account, or if Agent placed all or any part of the Collateral privately with a
purchaser or purchasers.

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<PAGE> 134
5.5. Application of Moneys. Any moneys received by Agent upon
payment to it of any Collateral held by it or as proceeds of any of the
Collateral may be applied by Agent to the payment of any expenses incurred by
it in connection with the Collateral, including, without limitation, reasonable
attorneys' fees and legal expenses and all amounts payable by each Pledgor
under Section 11.04 of the Credit Agreement. Any balance of such moneys so
received by Agent shall be applied by Agent:

(a) first, Ratably, (i) to the unpaid interest
(including, without limitation, post-petition interest) accrued and
then due on all Notes (including any premium, if any, thereon), and
(ii) to all unpaid closing, commitment and agents fees, if any,
accrued and then due;

(b) second, Ratably among all holders of Notes on account
of all principal of the Notes then due;

(c) third, if any Event of Default shall have occurred
and be continuing, Ratably (i) to the unpaid interest accrued on all
Notes not then due, (ii) to the outstanding principal amount of all
Notes not then due, and (iii) to the payment in full of all other
items which constitute Obligations under the definition thereof;

(d) fourth, if any Event of Default shall have occurred
and be continuing and all items which constitute Obligations under the
definition thereof, whether or not then due, shall have been paid in
full, ratably to all other Obligations to any Bank then due; and

(e) fifth, if no Event of Default shall have occurred and
be continuing or after payment in full of all Obligations and other
obligations referred to above, to the payment to each Pledgor or its
successors or assigns, or as a court of competent jurisdiction may
direct, of any surplus then remaining from such moneys.

ARTICLE VI
MISCELLANEOUS

6.1. Obligations Not Affected. The obligations of each Pledgor under
this Agreement shall remain in full force and effect without regard to, and
shall not be impaired or affected by:

(a) any amendment or modification or addition or
supplement to the Credit Agreement, or any Instrument contemplated
thereby or any assignment or transfer thereof, except amendments or
modifications hereto effected in accordance with Section 6.5;

(b) any exercise, non-exercise or waiver by Agent or any
Bank of any right, remedy, power or privilege under or in respect of
this Agreement, the Credit Agreement or any Instrument executed
pursuant hereto;

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<PAGE> 135
(c) any waiver, consent, extension, indulgence or other
action or inaction in respect of this Agreement, the Credit Agreement
or any Instrument executed pursuant hereto or any assignment or
transfer of any thereof; or

(d) any bankruptcy, insolvency, reorganization,
arrangement, readjustment, composition, liquidation, or the like, of
each Pledgor or any other Person, whether or not each Pledgor shall
have notice or knowledge of any of the foregoing.

6.2. Protection of Collateral. Agent may from time to time, at its
option, perform any act which each Pledgor agrees hereunder to perform and
which a Pledgor or Pledgors fails to perform after being requested in writing
to so perform (it being understood that no such request need be given after the
occurrence and during the continuance of any Event of Default) and Agent may
from time to time take any other action which Agent reasonably deems necessary
for the maintenance, preservation or protection of any of the Collateral or of
its security interest therein. Such Pledgor or Pledgors will, upon demand,
repay to Agent all moneys advanced by Agent in connection with the foregoing,
together with interest at a rate (or any maximum lesser rate permitted by
applicable law) per annum equal to the sum of the Base Rate from time to time
most recently announced by Agent plus 2%.

6.3. Agent Not Responsible. Agent is required to exercise reasonable
care in the custody and preservation of any of the Collateral in its
possession; however, Agent shall be deemed to have exercised reasonable care in
the custody and preservation of any of the Collateral if it takes such action
for that purpose as a Pledgor or Pledgors reasonably request in writing at
times other than upon the occurrence and during the continuance of any Event of
Default, but failure of Agent to comply with any such request shall at any time
not in itself be deemed a failure to exercise reasonable care.

6.4. Additional Pledges. If the Company or any Subsidiary hereafter
incorporates, acquires or otherwise obtains a Domestic Subsidiary which is also
a Material Subsidiary ("New Domestic Subsidiary"), then the Company shall
pledge or shall cause such Subsidiary to pledge to Agent all of the New
Domestic Subsidiary's Intercompany Notes, all of its Distributions, all of its
shares of capital stock and all other securities, instruments and rights from
time to time received by or distributable to each Pledgor in respect of any
Collateral. In addition, if the Company or any Domestic Subsidiary hereafter
incorporates, acquires or otherwise obtains a Foreign Subsidiary which is also
a Material Subsidiary ("New Foreign Subsidiary"), then the Company shall pledge
or shall cause such Subsidiary to pledge to Agent 65% of the shares of capital
stock of such New Foreign Subsidiary and all other securities, instruments and
rights from time to time received by or distributable to each Pledgor in
respect of any Collateral. Upon the occurrence of any of the foregoing, the
Company shall execute and deliver or shall cause its Subsidiary to execute and
deliver a supplement to this Agreement in the form of Exhibit B (with only such
changes thereto as are agreed to by the Agent), and in the case of the Company
pledging shares of a New Domestic

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<PAGE> 136
Subsidiary or New Foreign Subsidiary, such shares shall be deemed to be Pledged
Shares, and in the case of a new Subsidiary executing such supplement, such
Person shall be deemed a Pledgor for all purposes hereunder.

6.5. Successors and Assigns. This Agreement shall be binding upon
each Pledgor and its successors and assigns and shall inure to the benefit of,
and shall be enforceable by, the Agent and the Banks and their respective
successors and assigns pursuant to the Credit Agreement.

6.6. Further Assurances. Each Pledgor, jointly and severally, agrees
to do such further acts and things and to execute and deliver such additional
agreements, powers and instruments as the Agent may reasonably require or
reasonably deem advisable to carry into effect the purposes of this Agreement
or to better assure and confirm unto the Agent its rights, powers and remedies
under this Agreement, the Credit Agreement or any other Loan Document.

6.7. Loan Document. This Agreement is a Loan Document executed and
delivered pursuant to the Credit Agreement and shall (unless otherwise
expressly indicated herein) be construed, administered and applied in
accordance with the terms and provisions thereof. Without limiting the
generality of the foregoing, the provisions of Sections 1.02 and 1.03 of the
Credit Agreement shall apply to the interpretation and administration of this
Agreement as if such provisions were incorporated herein, with all references
to the "Agreement" in such Sections 1.02 and 1.03 being deemed to be references
to this Amended and Restated Senior Pledge Agreement.

6.8. Waivers; Writing Required. No delay or omission by the Agent or
any Bank to exercise any right under this Agreement shall impair any such
right, nor shall it be construed to be a waiver thereof. No waiver of any
single breach or default under this Agreement shall be deemed a waiver of any
other breach or default. Any amendment or waiver of any provision of this
Agreement must be in writing and signed by the Pledgors and the Agent, in
accordance with the terms of Section 11.01 of the Credit Agreement.

6.9. Remedies. All rights and remedies provided in this Agreement
and any instrument or agreement referred to herein are cumulative and are not
exclusive of any rights or remedies otherwise provided by law. Any single or
partial exercise of any right or remedy shall not preclude the further exercise
thereof or the exercise of any other right or remedy.

6.10. Costs and Expenses. Each Pledgor agrees to pay or reimburse
the Agent and each Bank promptly after demand for all reasonable out-of-pocket
costs and expenses (including reasonable Attorney Costs) incurred by them in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement during the existence of an Event of
Default or after acceleration of the Loans (including all costs and expenses
incurred in connection with any "workout" or restructuring regarding amounts
due under this Agreement, and including all costs and expenses incurred in any
Insolvency Proceeding or appellate proceeding).

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<PAGE> 137
6.11. Severability. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement referred to herein
shall not in any way affect or impair the legality or enforceability of the
remaining provisions of this Agreement or any instrument or agreement referred
to herein.

6.12. GOVERNING LAW AND JURISDICTION.

(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED THAT THE
AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF
THE STATE OF ILLINOIS OR OF THE UNITED STATES FOR THE NORTHERN
DISTRICT OF ILLINOIS, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH OF THE PLEDGORS, THE COMPANY, THE AGENT AND THE BANKS CONSENTS,
FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE PLEDGORS, THE COMPANY, THE
AGENT, THE DESIGNATED BIDDERS AND THE BANKS IRREVOCABLY WAIVES ANY
OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON
THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION
IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE
PLEDGORS, THE COMPANY, THE AGENT, THE DESIGNATED BIDDERS AND THE BANKS
EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS
LAW.

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<PAGE> 138
JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR
RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS SECTION AS
TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN WHOLE OR IN
PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT OR THE
OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER SHALL
APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

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

6.15. Headings. Section and other headings used in this Agreement
are for convenience only and shall not affect the construction of this
Agreement.

6.16. Entire Agreement. This Agreement (a) integrates all the terms
and conditions mentioned herein or incidental hereto, (b) supersedes all oral
negotiations and prior writings with respect to the subject matter hereof, and
(c) is intended by the parties as the final expression of the agreement with
respect to the terms and conditions set forth in this Agreement and as the
complete and exclusive statement of the terms agreed to by the parties.

[SIGNATURE PAGE FOLLOWS]

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<PAGE> 139
IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
their duly authorized officers as of the day and year first above written.

IDEX CORPORATION

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
---------------------------
Facsimile No.: (312) 498-3940

BANK OF AMERICA ILLINOIS,
as Agent

By:
-----------------------------------
Title:
--------------------------------

S-1
<PAGE> 140
SCHEDULE I

PLEDGED NOTES

<TABLE>
<CAPTION>
Principal Amount of
Subsidiary Date Intercompany Note
- ---------- ---------- -----------------
<S> <C> <C>

Band-It-IDEX, Inc. 10/24/94 $18,411,086

Vibratech, Inc. 10/24/94 $11,506,929

Lubriquip, Inc. 10/24/94 $27,599,999

Strippit, Inc. 10/24/94 $15,342,572

Viking Pump, Inc. 10/24/94 $38,356,430

Warren Rupp, Inc. 10/24/94 $30,685,144

Corken, Inc. 10/24/94 $11,000,000

Pulsafeeder, Inc. 10/24/94 $56,000,000

Hale Products, Inc. 10/24/94 $70,000,000

Micropump, Inc. 11/01/95 $22,000,000

</TABLE>

-1-
<PAGE> 141
SCHEDULE II

PLEDGED SHARES

<TABLE>
<CAPTION>
Capital Stock
-------------
Subsidiary Issuer Number of Shares Certificate Number
---------------- ------------------
<S> <C> <C>

Band-It-IDEX, Inc. 100 2
(f/k/a Houdaille Band-It, Inc. and
f/k/a Band-It-Houdaille, Inc.)

Vibratech, Inc. 100 2
(f/k/a Houdaille Hydraulics, Inc. and
f/k/a Hydraulics-Houdaille, Inc.)

Lubriquip, Inc. 100 2
(f/k/a Houdaille Lubriquip, Inc. and
f/k/a Lubriquip-Houdaille, Inc.)

Strippit, Inc. 100 2
(f/k/a Houdaille Strippit-DiAcro, Inc. and
f/k/a Strippit-Houdaille, Inc.)

Viking Pump, Inc. 100 2
(f/k/a Houdaille Viking Pump, Inc. and
f/k/a Viking Pump-Houdaille, Inc.)

Warren Rupp, Inc. 100 2
(f/k/a Houdaille Warren Rupp, Inc. and
f/k/a Warren-Rupp-Houdaille, Inc.)

Corken, Inc. 100 2
(f/k/a CIC Acquisition Corp.)

Pulsafeeder, Inc. 100 1
(f/k/a PLF Acquisition Corporation)

Hale Products, Inc. 100 1
(f/k/a Hale Fire Pump Company)

Micropump, Inc. 100 1
(f/k/a MC Acquisition Corp.)

</TABLE>

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<PAGE> 142
EXHIBIT A

FORM OF INTERCOMPANY NOTE

FOR VALUE RECEIVED, the undersigned, _____________________, a
__________________ corporation ("Borrower"), promises to pay to the order of
__________________, a __________________ corporation ("Lender"), on the demand
of the Lender (or immediately upon any acceleration described in the last
paragraph of this Intercompany Note), the amount that has been advanced and is
then outstanding hereunder, together with interest thereon as hereinafter set
forth.

This Intercompany Note is one of the Intercompany Notes referred to
and defined in that certain Amended and Restated Pledge Agreement dated as of
July 17, 1996 (as amended, restated, supplemented or otherwise modified from
time to time, the "Pledge Agreement") by IDEX Corporation (together with its
successors and assignors, "IDEX Corporation"), a Delaware corporation and
certain of its subsidiaries (including Borrower), in favor of Bank of America
Illinois, as Agent for the financial institutions from time to time party to
that certain Credit Agreement referred to in the Pledge Agreement. Unless
otherwise defined herein, each capitalized term used herein shall have the
meaning assigned thereto in the Pledge Agreement or, if not defined therein, as
defined in the Credit Agreement referred to in the Pledge Agreement.

Borrower hereby expressly acknowledges and agrees that Lender may,
pursuant to the terms of the Pledge Agreement, pledge all of its rights, title
and interest hereunder to the Agent (as defined in the Pledge Agreement) for
the benefit of the Agent and the Banks identified in the Pledge Agreement.

This Intercompany Note is a note under which advances, repayments and
new advances may be made from time to time, provided that Lender shall not be
obligated to make any advance hereunder. Advances hereunder may be requested
by Borrower orally or in writing.

The principal balance of advances outstanding from time to time under
this Intercompany Note shall bear interest at a per annum rate to be agreed by
Lender and Borrower from time to time; interest shall be computed on a daily
basis using a year of 365 or 366 days, as the case may be, and assessed for the
actual number of days elapsed. Interest shall be payable in arrears with such
frequency as agreed by Borrower and Lender from time to time, but in no event
less frequently than quarterly, on the last day of each such period as so
agreed by Borrower and Lender and otherwise on demand.

If any payment hereunder is due and payable on a day that is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day, and interest shall be payable thereon during such extension at
the rate specified above.

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<PAGE> 143
Any and all principal and interest not paid when due and owing under
this Intercompany Note shall bear interest at a per annum rate equal to two
percent (2.0%) plus the interest rate applicable hereunder on the date that
such principal and/or interest is first due but not paid. If this Intercompany
Note or any part of the indebtedness evidenced hereby is not paid when due,
Borrower promises to pay all reasonable costs of collection, including, without
limitation, Attorney Costs and all other reasonable expenses incurred by the
holder hereof in connection therewith, whether or not suit is filed hereon.

If any interest payable hereunder exceeds the maximum amount then
permitted by applicable law, Borrower shall be obligated to pay the maximum
amount then permitted by applicable law and Borrower shall continue to pay the
maximum amount from time to time permitted by applicable law until all such
interest otherwise due hereunder (in the absence of such restraint imposed by
applicable law) has been paid in full.

Both the principal of and interest on this Intercompany Note are
payable in lawful money of the United States of America to Lender, to such
account as Lender may designate from time to time, in same day funds. At the
time of each advance hereunder, and upon each repayment of amounts outstanding
hereunder, Lender shall make a notation either on the schedule attached hereto
and made a part hereof, or in Lender's own books and records, in each case
specifying the amount of such advance, the interest rate in effect from time to
time hereunder and the amount of principal and interest paid, as the case may
be; provided, that Lender's failure to make any such recordation or notation
shall not affect the obligations of Borrower hereunder. Such records shall be
prima facie evidence of the amount and timing of all advances, repayments and
interest rate determinations.

Presentment, protest and notice of nonpayment and protest are hereby
waived by Borrower.

THIS INTERCOMPANY NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE
LAWS OF THE STATE OF ILLINOIS, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF SAID STATE, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAW.

Whenever possible each provision of this Intercompany Note shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Intercompany Note shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Intercompany Note.

Whenever in this Intercompany Note reference is made to Lender or
Borrower, such reference shall be deemed to include, as applicable, a reference
to their respective successors and assigns. The provisions of this
Intercompany Note shall be binding upon Borrower and its

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<PAGE> 144
successors and assigns, and shall inure to the benefit of the Lender and its
successors and assigns. Borrower's successors and assigns shall include,
without limitation, a receiver, trustee or debtor-in-possession of or for
Borrower.

Immediately upon any acceleration of amounts owing by IDEX Corporation
under the Credit Agreement or any of the other Loan Documents (whether as the
result of a declaration by the Agent or the occurrence of an Event of Default
described in clause (f) or (g) of Section 9.01 of the Credit Agreement), all
principal, interest and other amounts owing hereunder shall become due and
payable without the requirement of any acceleration or request, and without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by Borrower.

[SIGNATURE PAGE FOLLOWS]

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<PAGE> 145
IN WITNESS WHEREOF, the undersigned has caused this Intercompany Note
to be duly executed as of _________________.

[BORROWER]

By:
---------------------------
Name:
---------------------------
Title:
---------------------------

- 4 -
<PAGE> 146
SCHEDULE A
TO
INTERCOMPANY NOTE

SCHEDULE OF ADVANCES AND REPAYMENTS

- 5 -
<PAGE> 147
EXHIBIT B

FORM OF SUPPLEMENT TO THE AMENDED AND RESTATED
SENIOR PLEDGE AGREEMENT

This Supplement No. ___________ dated as of _______________
(this "Supplement") to the Pledge Agreement (as defined below) is by
____________________, a ___________________________ corporation (the
"Pledgor"), in favor of Bank of America Illinois, as Agent (as defined in the
Pledge Agreement) under the Pledge Agreement for the benefit of the secured
parties thereunder.

RECITALS:

A. IDEX Corporation, a Delaware corporation (the "Company"), the
Agent and the Banks (as defined in the Pledge Agreement) entered into that
certain Third Amended and Restated Credit Agreement dated as of July 17, 1996.
The Third Amended and Restated Credit Agreement as now in effect or hereafter
extended, renewed, modified, supplemented, amended or restated is hereinafter
called the "Credit Agreement".

B. The Company is a party to that certain Amended and Restated
Pledge Agreement dated as of July 17, 1996 (as amended, restated, supplemented
or otherwise modified from time to time, the "Pledge Agreement") with Bank of
America Illinois, as Agent for the financial institutions from time to time
party to that certain Credit Agreement. Unless otherwise defined herein, each
capitalized term used herein shall have the meaning assigned thereto in the
Pledge Agreement or, if not defined therein, as defined in the Credit Agreement
referred to in the Pledge Agreement.

C. Pursuant to Section 6.4 of the Pledge Agreement, this
Supplement is required to be executed and delivered to the Agent.

In consideration of the premises above and as set forth in the
Pledge Agreement, the parties hereto agree as follows:

ARTICLE I
SUPPLEMENT TO PLEDGE AGREEMENT

1.1. Supplement to Pledge Agreement. In accordance with
Section 6.4 of the Pledge Agreement, Pledgor, by its execution and delivery of
this Supplement, [INSERT THE FOLLOWING IF PLEDGOR IS NOT ALREADY A PARTY TO THE
PLEDGE AGREEMENT:

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<PAGE> 148
becomes a party to the Pledge Agreement with the same force and effect as if
originally named therein a "Pledgor", and Pledgor hereby (a) agrees to all the
terms and provisions of the Pledge Agreement, (b) represents and warrants that
the representations and warranties made by it as a Pledgor thereunder are true
and correct in all material respects on and as of the date hereof and (c)
agrees that the Schedules hereto (which are designated as supplements to the
corresponding Schedules to the Pledge Agreement) are hereby incorporated in
their entirety into such corresponding Schedules to the Pledge Agreement. Each
reference to a "Pledgor" in the Pledge Agreement shall be deemed to include the
Pledgor. Each reference to "Pledged Notes", "Pledged Shares", and "Pledged
Property" in the Pledge Agreement shall be deemed to include the Pledged Notes,
Pledged Shares and Pledged Property pledged herein. All of the terms of the
Pledge Agreement are hereby incorporated in their entirety.] [INSERT THE
FOLLOWING IF PLEDGOR IS A PARTY TO THE PLEDGE AGREEMENT: Pledgor hereby (a)
represents and warrants that the representations and warranties made by it as a
Pledgor under the Pledge Agreement are true and correct in all material
respects on and as of the date hereof and (b) agrees that the Schedules hereto
(which are designated as supplements to the corresponding Schedules to the
Pledge Agreement) are hereby incorporated in their entirety into such
corresponding Schedules to the Pledge Agreement. Each reference to "Pledged
Notes", "Pledged Shares", and "Pledged Property" in the Pledge Agreement shall
be deemed to include the Pledged Notes, Pledged Shares and Pledged Property
pledged herein.]

1.2. Additional Representations, Warranties and Covenants.
Pledgor represents and warrants to the Agent and the Banks that this Supplement
has been duly authorized, executed and delivered by it and constitutes its
legal, valid and binding obligation, enforceable against it in accordance with
its terms.

ARTICLE II
SECURITY INTERESTS

2.1. Grant of Security Interest.

(a) As security for payment of all Obligations of
such Pledgor, [INSERT THE FOLLOWING IF PLEDGOR IS PARTY TO THE PLEDGE
AGREEMENT: each Pledgor hereby ratifies and confirms its pledge and grant of a
security interest pursuant to the Pledge Agreement and] [INSERT THE FOLLOWING
IF PLEDGOR IS NOT ALREADY A PARTY TO THE PLEDGE AGREEMENT: each Pledgor]
hereby pledges, assigns and transfers to Agent and grants to Agent a continuing
security interest in and to the shares of capital stock and/or promissory notes
identified on Schedules I and II attached hereto together with all Dividends,
Distributions, interest and other payments and rights with respect thereto and
all proceeds of any of the foregoing (all of the items referred to in this
Section 2.1 being herein called the "Collateral"). The parties agree that such
capital stock and/or promissory notes shall be Pledged Shares or Pledged Notes
pursuant to the Pledge Agreement and shall be subject to the terms and
conditions of the Pledge Agreement.

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<PAGE> 149
(b) All advances, charges, costs and expenses,
including reasonable attorneys' fees, incurred or paid by Agent in exercising
any right, power or remedy conferred by this Agreement, or in the enforcement
hereof or thereof, shall, to the extent lawful, become a part of the
Obligations secured hereby.

(c) The Pledged Notes listed on Schedule I hereto
and the certificates representing the Pledged Shares listed on Schedule II
hereto shall be delivered to the Agent contemporaneously herewith together with
appropriate undated note powers and stock powers duly executed in blank.
Neither the Agent nor any Bank shall be obligated to preserve or protect any
rights with respect to the Pledged Notes or the Pledged Shares or to receive or
give any notice with respect thereto whether or not the Agent or any Bank
(other than the Company) is deemed to have knowledge of such matters.

(d) The assignments and security interests under
this Supplement granted to the Agent shall not relieve Pledgor from the
performance of any term, covenant, condition or agreement on Pledgor's part to
be performed or observed under or in respect of any of the Collateral pledged
by it hereunder or from any liability to any Person under or in respect of any
of such Collateral or impose any obligation on the Agent to perform or observe
any such term, covenant, condition or agreement on Pledgor's part to be so
performed or observed or impose any liability on the Agent for any act or
omission on the part of Pledgor relative thereto or for any breach of any
representation or warranty on the part of Pledgor contained in this
Supplement, the Pledge Agreement or any other Loan Document, or in respect of
the Collateral pledged by it hereunder or made in connection herewith or
therewith. The obligations of Pledgor contained in this paragraph shall
survive the termination of the Pledge Agreement and the discharge of Pledgor's
other obligations thereunder.

(e) Pledgor agrees, at its own expense, to
execute, acknowledge and deliver, or cause the execution, acknowledgment and
delivery of, and thereafter to register, file or record in any and all
appropriate governmental offices, any and all documents and instruments
reasonably deemed by the Agent to be necessary or desirable for the creation
and perfection of the foregoing security interests granted pursuant hereto.
Pledgor further agrees to take all actions reasonably requested by the Agent
(including, without limitation, the filing of UCC-1 financing statements) in
connection with the granting of such security interests. Pledgor agrees to
pay in full all taxes, fees and other charges payable in connection with the
actions described in this clause (e).

2.2 Power of Attorney. Pledgor hereby constitutes and
appoints the Agent its true and lawful attorney, irrevocably, with full power
after the occurrence of and during the continuance of a Default Event (in the
name of Pledgor or otherwise), in the Agent's discretion, to take any action
and to execute any instrument which the Agent may reasonably deem necessary or
advisable to accomplish the purposes of the Pledge Agreement, which appointment
as attorney is coupled with an interest.

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<PAGE> 150
ARTICLE III
MISCELLANEOUS

3.1. Miscellaneous Provisions. Each of the provisions set
forth in Sections 6.1 through 6.17 (inclusive) of the Pledge Agreement is
hereby incorporated by reference mutatis mutandis with the same effect as if
such provisions had been set forth herein with each reference therein to "this
Agreement" deemed to be a reference to "this Supplement" and each reference to
a "Pledgor" deemed to be a reference to " Pledgor".

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties hereto have caused this
Supplement No. ____ to the Pledge Agreement to be duly and properly executed
and delivered as of the date first written above.

[PLEDGOR]

By:
---------------------------------
Title:
------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
--------------------------
Facsimile No.: (312) 498-3940

Agreed and Accepted:

BANK OF AMERICA ILLINOIS,
as Agent

By:
---------------------------------
Title:
------------------------------

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SCHEDULE I (TO SUPPLEMENT NO. _____)

PLEDGED NOTES

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SCHEDULE II (TO SUPPLEMENT NO. _____)

PLEDGED SHARES

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EXHIBIT 1.01B

FORM OF
AMENDED AND RESTATED SUBSIDIARY GUARANTY AGREEMENT

This Amended and Restated Subsidiary Guaranty (as amended, restated,
supplemented, renewed or otherwise modified from time to time, this "Guaranty")
is entered into as of July 17, 1996, by each of the undersigned corporations
and each Person that becomes a party hereto in accordance with Section 4.6
hereof (each a "Guarantor" and collectively, the "Guarantors"), in favor of
Bank of America Illinois, as Agent for itself (in such capacity, the "Agent")
and the financial institutions from time to time party to the Credit Agreement
described below (the "Banks").

RECITALS:

A. IDEX Corporation, a Delaware corporation (the "Company"), the
Agent and the Banks entered into that certain Third Amended and Restated Credit
Agreement dated as of July 17, 1996. The Third Amended and Restated Credit
Agreement as now in effect or hereafter extended, renewed, modified,
supplemented, amended or restated is hereinafter called the "Credit Agreement".

B. The Banks are willing to make certain Loans to the Company and
the Issuing Bank is willing to issue Letters of Credit for the account of the
Company as provided in the Credit Agreement on the condition (among others)
that the Guarantors enter into this Guaranty.

C. Each Guarantor has previously entered into guaranties (See
Recital D below) pursuant to that certain Credit Agreement, among the Company,
Agent and various banking institutions, dated January 22, 1988 (herein, as
amended by the First Amendment dated as of May 22, 1989, a Letter Agreement
dated as of May 7, 1991, the Amended and Restated Credit Agreement dated as of
May 4, 1992, the Second Amended and Restated Credit Agreement dated as of
January 29, 1993, which in turn was amended by the First Amendment dated as of
May 23, 1994, the Second Amendment dated as of October 24, 1994, the Third
Amendment dated as of February 28, 1995, the Fourth Amendment dated November 1,
1995 and the Fifth Amendment dated December 22, 1995), and such guaranties are
hereby deemed to be amended and restated by this Guaranty.

D. Each Guarantor has previously entered into the following
respective guaranties: Guaranty Agreement, dated January 22, 1988, entered into
by Lubriquip, Inc. (successor to Lubriquip-Houdaille, Inc.), Warren Rupp, Inc.
(successor to Warren Rupp-Houdaille, Inc.), Viking Pump, Inc. (successor to
Viking Pump-Houdaille, Inc.), Vibratech, Inc. (successor to
Hydraulics-Houdaille, Inc.), Band-It-IDEX, Inc. (successor to
Band-It-Houdaille, Inc.), Strippit, Inc. (successor to Strippit-Houdaille,
Inc.); Guaranty Agreement, dated May 7, 1991, entered into by Corken, Inc.
(successor to CIC Acquisition Corp.); Guaranty Agreement, dated May 4, 1992,
entered into by Pulsafeeder, Inc. (successor to PLF Acquisition Corporation
and MCL Acquisition Corporation); Guaranty Agreement, dated October 24, 1994,
entered into by Hale Products, Inc.; Guaranty Agreement, dated November 1,
1995, entered into by Micropump, Inc.; and the Guaranty

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Agreement, dated December 22, 1995, entered into by Dunja
Verwaltungsgesellschaft mbH. All of the foregoing guaranty agreements
collectively referred to as the "Original Guaranty Agreements".

E. Each Guarantor, as a wholly-owned Subsidiary of the Company,
will derive continuing, substantial and direct benefits (which benefits are
hereby acknowledged by the Guarantors) from the Loans and the Letters of Credit
and other benefits to be provided to the Company under the Credit Agreement.

F. In order to induce the Banks to continue to make such Loans
available to the Company and to induce the Issuing Bank to issue such Letters
of Credit for the account of the Company, and for other valuable consideration,
the Guarantors hereby agree that the Original Guaranty Agreements are hereby
amended and restated in their entirety as follows:

1. Definitions. Unless otherwise defined herein, capitalized
terms used in this Guaranty have the meanings given to such terms from time to
time in the Credit Agreement. References to the Banks or any Bank herein shall
include the Issuing Bank in its capacity as a Bank and as Issuing Bank.

2. Guaranty.

2.1 Guaranty. Each Guarantor hereby irrevocably,
absolutely and unconditionally jointly and severally guarantees the full and
punctual payment or performance when due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise, of all of
the Obligations, including (a) Obligations in respect of amounts that would
become due but for the operation of the automatic stay under Section 362(a) of
the Bankruptcy Code or the operation of Sections 502(b) and 506(b) of the
Bankruptcy Code and (b) Obligations to deliver and pledge cash collateral upon
certain events. This Guaranty constitutes a guarantee of payment and
performance when due and not of collection, and each Guarantor specifically
agrees that it shall not be necessary or required that the Agent or any Bank
exercise any right, assert any claim or demand or enforce any remedy whatsoever
against the Company (or any other Person) before or as a condition to the
obligations of such Guarantor hereunder. The Agent or any Bank may permit the
indebtedness of the Company to the Agent or any Bank to include indebtedness
other than the Obligations and may apply any amounts received from any source,
other than from the Guarantors, to that portion of the Company's indebtedness
to the Agent or any Bank which is not a part of the Obligations.

2.2 Obligations Independent. The obligations hereunder
are independent of the obligations of the Company, and a separate action or
actions may be brought and prosecuted against the Guarantors whether action is
brought against the Company or whether the Company be joined in any such action
or actions.

2.3 Authorization of Renewals, Etc. Each Guarantor
authorizes the Agent and each Bank without notice or demand and without
affecting its liability hereunder, from time to time:

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(a) to renew, compromise, extend, accelerate or
otherwise change the time for payment, or otherwise change the terms,
of the Obligations, including any increase or decrease of the rate of
interest thereon, or otherwise change the terms of the Credit
Agreement or any other Loan Document;

(b) to receive and hold security for the payment
of this Guaranty or the Obligations and exchange, enforce, waive,
release, fail to perfect, sell, or otherwise dispose of any such
security;

(c) to apply such security and direct the order
or manner of sale thereof as the Agent, or any Bank, as the case may
be, in its or their discretion may determine; and

(d) to release or substitute any one or more of
any endorsers or guarantors of the Obligations.

Each Guarantor further agrees the performance or occurrence of any of the acts
or events described in clauses (a), (b), (c) and (d) above with respect to
indebtedness or other obligations of the Company, other than the Obligations,
to the Agent or any Bank, shall not affect the liability of such Guarantor
hereunder.

2.4 Waiver of Certain Rights. Each Guarantor waives any
right to require the Agent or any Bank:

(a) to proceed against the Company or any other
Person;

(b) to proceed against or exhaust any security
for the Obligations or any other indebtedness of the Company to the
Agent or any Bank; or

2.5 Waiver of Certain Defenses. Each Guarantor waives
any defense arising by reason of any disability or other defense of the
Company, or the cessation from any cause whatsoever of the liability of the
Company, whether consensual or arising by operation of law or any bankruptcy,
insolvency or debtor relief proceeding, or from any other cause, or any claim
that such Guarantor's obligations exceed or are more burdensome than those of
the Company.

2.6 Waiver of Presentments, Etc. Each Guarantor waives
all presentments, demands for performance, notices of nonperformance, protests,
notices of protest, notices of dishonor and notices of acceptance of this
Guaranty and of the existence, creation or incurring of new or additional
Obligations or any other indebtedness of Company to the Agent or any Bank.

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2.7 Information Relating to Company. Each Guarantor
acknowledges and agrees that it shall have the sole responsibility for
obtaining from the Company such information concerning the Company's financial
condition or business operations as such Guarantor may require and that
neither the Agent nor any Bank has any duty at any time to disclose to any
Guarantor any information relating to the business operations or financial
condition of the Company.

2.8 Right of Set-off. In addition to any rights and
remedies of the Banks provided by law, if any Guarantor has failed to make any
payment due hereunder upon demand, each Bank is authorized at any time and from
time to time, without prior notice to such Guarantor, any such notice being
waived by such Guarantor to the fullest extent permitted by law, to set-off and
apply any and all Guarantor deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by such Bank to or for the credit or the account of such Guarantor against any
and all obligations of such Guarantor now or hereafter existing under this
Guaranty or any other Loan Document, irrespective of whether or not the Agent
or such Bank shall have made demand under this Guaranty or any other Loan
Document and although such obligations may be contingent or unmatured. Each
Bank agrees promptly to notify such Guarantor and the Agent after any such
set-off and application made by such Bank; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application. The rights of each Bank under this Section 2.8 are in addition to
the other rights and remedies (including, without limitation, other rights of
set-off) which such Bank may have.

2.9 Reinstatement of Guaranty. If any payment or
transfer of any interest in property by the Company to the Agent or any Bank in
fulfillment of any Obligation is rescinded or must at any time (including after
the return or cancellation (other than by written release herefrom) of this
Guaranty) be returned, in whole or in part, by the Agent or any Bank to the
Company or any other Person, upon the insolvency, bankruptcy or reorganization
of the Company or otherwise, this Guaranty shall be reinstated with respect to
any such payment or transfer, regardless of any such prior return or
cancellation.

2.10 Powers. It is not necessary for the Agent or any
Bank to inquire into the powers of the Company or of the officers, directors,
partners or agents acting or purporting to act on its behalf, and any
Obligations made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.

2.11 Taxes.

(a) Any and all payments by any Guarantor to each
Bank or the Agent under this Guaranty shall be made free and clear of,
and without deduction or withholding for, any Taxes. In addition,
such Guarantor shall pay all Other Taxes.

(b) If any Guarantor shall be required by law to
deduct or withhold any Taxes, Other Taxes or Further Taxes from or in
respect of any sum payable hereunder to any Bank or the Agent, then:

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<PAGE> 158
(i) the sum payable shall be increased
as necessary so that, after making all required deductions and
withholdings (including deductions and withholdings applicable
to additional sums payable under this Section 2.11), such Bank
or the Agent, as the case may be, receives and retains an
amount equal to the sum it would have received and retained
had no such deductions or withholdings been made;

(ii) such Guarantor shall make such
deductions and withholdings;

(iii) such Guarantor shall pay the full
amount deducted or withheld to the relevant taxing authority
or other authority in accordance with applicable law; and

(iv) such Guarantor shall also pay to
each Bank or the Agent for the account of such Bank, at the
time interest is paid, Further Taxes in the amount that the
respective Bank specifies as necessary to preserve the
after-tax yield the Bank would have received if such Taxes,
Other Taxes or Further Taxes had not been imposed.

(c) Each Guarantor agrees to indemnify and hold
harmless each Bank and the Agent for the full amount of (i) Taxes,
(ii) Other Taxes and (iii) Further Taxes in the amount that the
respective Bank specifies as necessary to preserve the after-tax yield
the Bank would have received if such Taxes, Other Taxes or Further
Taxes had not been imposed, and any liability (including penalties,
interest, additions to tax and expenses) arising therefrom or with
respect thereto, whether or not such Taxes, Other Taxes or Further
Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days after the date the Bank
or the Agent makes written demand therefor.

(d) Within 30 days after the date of any payment
by any Guarantor of Taxes, Other Taxes or Further Taxes, such
Guarantor shall furnish to each Bank or the Agent the original or a
certified copy of a receipt evidencing payment thereof, or other
evidence of payment satisfactory to such Bank or the Agent.

(e) If any Guarantor is required to pay any
amount to any Bank or the Agent pursuant to subsection (b) or (c) of
this Section 2.11, then such Bank shall use reasonable efforts
(consistent with legal and regulatory restrictions) to change the
jurisdiction of its Lending Office so as to eliminate any such
additional payment by such Guarantor which may thereafter accrue, if
such change in the sole judgment of such Bank is not otherwise
disadvantageous to such Bank.

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or withholding for any applicable Taxes pursuant to subsection (a) of
this Section 2.11, if the Bank or Agent fails to deliver forms to such
Guarantor in accordance with Section 10.10 of the Credit Agreement on
a timely basis, unless such failure would not have occurred but for a
change in law or regulation or in the interpretation thereof by any
governmental or regulatory agency or body charged with the
administration or interpretation thereof, or the introduction of any
law or regulation, that occurs on or after the date hereof.

(g) For purposes of this Section, (i) "Taxes"
means any and all present or future taxes, levies, assessments,
imposts, duties, deductions, fees, withholdings or similar charges,
and all liabilities with respect thereto, excluding, in the case of
each Bank and the Agent, respectively, taxes imposed on or measured by
such Bank's or the Agent's net income by the jurisdiction (or any
political subdivision thereof) under the laws of which such Bank or
the Agent, as the case may be, is organized or maintains a lending
office; (ii) "Other Taxes" means any present or future stamp, court or
documentary taxes or any other excise or property taxes, charges or
similar levies which arise from any payment made hereunder or from the
execution, delivery, performance, execution or registration of, or
otherwise with respect to, this Guaranty; and (iii) "Further Taxes"
means any and all present or future taxes, levies, assessments,
imposts, duties, deductions, fees, withholdings or similar charges
(including, without limitation, net income taxes and franchise taxes),
and all liabilities with respect thereto, imposed by any jurisdiction
on account of amounts payable or paid pursuant to this Guaranty.

2.12 Subrogation. None of the Guarantors shall have any
right of subrogation, indemnification or recourse to any Obligations or
collateral or other guarantees therefor or against the Company or any of its
assets or property until the Obligations shall have been paid in full.

3. Representations and Warranties. Each Guarantor represents and
warrants to the Agent and each Bank as follows:

3.1 Corporate Existence and Power. Such Guarantor (a)
is a corporation duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation; (b) has the power and
authority and all governmental licenses, authorizations, consents and approvals
to own its assets, carry on its business and to execute, deliver and perform
its obligations under this Guaranty and any other Loan Document to which it is
a party; (c) is duly qualified as a foreign corporation, and licensed and in
good standing, under the laws of each jurisdiction where its ownership, lease
or operation of property or the conduct of its business requires such
qualification or license except where the failure to be so qualified could not
reasonably be expected to have a Material Adverse Effect; and (d) is in
compliance with all Requirements of Law except where the failure to do so or to
so comply could not reasonably be expected to have a Material Adverse Effect.

3.2 Corporate Authorization; No Contravention. The
execution, delivery and performance by such Guarantor of this Guaranty and any
other Loan Document to which it is party,

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<PAGE> 160
have been duly authorized by all necessary corporate action, and do not and
will not (a) contravene the terms of any of such Guarantor's Organization
Documents; (b) conflict with or result in any breach or contravention of, or
the creation of any lien under, any document evidencing any Contractual
Obligation to which such Guarantor is a party or any order, injunction, writ or
decree of any Governmental Authority to which such Guarantor or its property is
subject; or (c) violate any Requirement of Law applicable to such Guarantor.

3.3 Governmental Authorization. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, such Guarantor
of this Guaranty or any other Loan Document to which it is a party.

3.4 Binding Effect. This Guaranty and each other Loan
Document to which such Guarantor is a party constitute the legal, valid and
binding obligations of such Guarantor, enforceable against such Guarantor in
accordance with their respective terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, or similar laws affecting the enforcement
of creditors' rights generally or by equitable principles relating to
enforceability.

3.5 Regulated Entities. None of such Guarantor, any
Person controlling such Guarantor or any Subsidiary of such Guarantor is (a) an
"Investment Company" within the meaning of the Investment Company Act of 1940;
or (b) subject to regulation under the Public Utility Holding Company Act of
1935, the Federal Power Act, the Interstate Commerce Act, any state public
utilities code, or any other Federal or state statute or regulation limiting
its ability to incur or guarantee Indebtedness.

3.6 Other Representations. Each of the Guarantors
represents and warrants as to itself that all representations and warranties
relating to it contained in the Credit Agreement are true and correct in all
material respects as of the date hereof.

4. Miscellaneous.

4.1 Application of Payments on Guaranty. All payments
required to be made by any Guarantor hereunder shall, unless otherwise
expressly provided herein, be made to the Agent for the account of the Banks at
the Agent's Payment Office and, with respect to principal of, interest on, and
any other amounts relating to, any Offshore Currency Loan, shall be made in the
Offshore Currency in which such Loan is denominated or payable and, with
respect to all other amounts payable hereunder, shall be made in Dollars. The
Agent will promptly distribute to each Bank its Pro Rata Share (or other
applicable share as expressly provided in the Credit Agreement) of such
principal, interest, fees or other amounts in like funds as received. Payments
received from any Guarantor shall, unless otherwise expressly provided herein,
be applied to costs, fees or other expenses due under the Loan Documents, any
interest (including interest due under Section 2.12 of the Credit Agreement),
any principal due under the Loan Documents and any other Obligations, in such
order as the Agent, with the consent of or at the request of the Banks, shall
determine.

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4.2 Assignments, Participations, Confidentiality. Any
Bank may from time to time, without notice to the Guarantors and without
affecting the Guarantors' obligations hereunder, transfer its interest in the
Obligations to Participants and Assignees as provided in the Credit Agreement.
Each Guarantor agrees that each such transfer will give rise to a direct
obligation of such Guarantor to each Assignee to which the Company, if
required, shall have consented to and that each Assignee shall have the same
rights and benefits under this Guaranty as it would have if it were a Bank
party to the Credit Agreement and this Guaranty. The Guarantors, the Agent and
each Bank agree that the provisions of Section 11.10 of the Credit Agreement
shall apply to all information identified as "confidential" or "secret" by any
Guarantor and provided to the Agent or such Bank by any Guarantor or any
Subsidiary of a Guarantor under this Guaranty or any other Loan Document to
which such Guarantor is a party.

4.3 Successors and Assigns. This Guaranty shall be
binding upon each Guarantor and its successors and assigns and shall inure to
the benefit of, and shall be enforceable by, the Agent and the Banks and their
respective successors and assigns pursuant to the Credit Agreement.

4.4 Further Assurances. Each Guarantor, jointly and
severally, agrees to do such further acts and things and to execute and deliver
such additional agreements, powers and instruments as either Agent or any Bank
may reasonably require or reasonably deem advisable to carry into effect the
purposes of this Guaranty or to better assure and confirm unto the Agent or any
Bank their rights, powers and remedies under this Guaranty, the Credit
Agreement or any other Loan Document.

4.5 Loan Document. This Guaranty is a Loan Document
executed and delivered pursuant to the Credit Agreement and shall (unless
otherwise expressly indicated herein) be construed, administered and applied in
accordance with the terms and provisions thereof. Without limiting the
generality of the foregoing, the provisions of Sections 1.02 and 1.03 of the
Credit Agreement shall apply to the interpretation and administration of this
Guaranty as if such provisions were incorporated herein, with all references to
the "Agreement" in such Sections 1.02 and 1.03 being deemed to be references to
this Guaranty.

4.6 Waivers; Writing Required. No delay or omission by
the Agent or any Bank to exercise any right under this Guaranty shall impair
any such right, nor shall it be construed to be a waiver thereof. No waiver of
any single breach or default under this Guaranty shall be deemed a waiver of
any other breach or default. Any amendment or waiver of any provision of this
Guaranty must be in writing and signed by the Guarantors and the Agent, with
the written consent of the Banks, in accordance with the terms of Section 11.01
of the Credit Agreement, provided that an additional Subsidiary of the Company
may become a Guarantor under this Guaranty pursuant to the requirements of
Section 7.13 of the Credit Agreement by executing and delivering to the Agent a
supplement to this Guaranty in the form of Exhibit A attached hereto (with only
such changes thereto as are agreed to by the Agent), whereupon, without further
action, approval or consent by any other Person, such Subsidiary shall be
deemed to be a Guarantor for all purposes under this Guaranty.

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4.7 Remedies. All rights and remedies provided in this
Guaranty and any instrument or agreement referred to herein are cumulative and
are not exclusive of any rights or remedies otherwise provided by law. Any
single or partial exercise of any right or remedy shall not preclude the
further exercise thereof or the exercise of any other right or remedy.

4.8 Costs and Expenses. Each Guarantor agrees to pay or
reimburse the Agent and each Bank promptly after demand for all reasonable
out-of-pocket costs and expenses (including reasonable Attorney Costs) incurred
by them in connection with the enforcement, attempted enforcement, or
preservation of any rights or remedies under this Guaranty during the existence
of an Event of Default or after acceleration of the Loans (including all costs
and expenses incurred in connection with any "workout" or restructuring
regarding amounts due under this Guaranty, and including all costs and expenses
incurred in any Insolvency Proceeding or appellate proceeding).

4.9 Severability. The illegality or unenforceability of
any provision of this Guaranty or any instrument or agreement referred to
herein shall not in any way affect or impair the legality or enforceability of
the remaining provisions of this Guaranty or any instrument or agreement
referred to herein.

4.10 GOVERNING LAW AND JURISDICTION.

(a) THIS GUARANTY SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS;
PROVIDED THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.

(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT
TO THIS GUARANTY OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE
COURTS OF THE STATE OF ILLINOIS OR OF THE UNITED STATES FOR THE
NORTHERN DISTRICT OF ILLINOIS, AND BY EXECUTION AND DELIVERY OF THIS
GUARANTY, EACH OF THE GUARANTORS, THE COMPANY, THE AGENT AND THE BANKS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE GUARANTORS,
THE COMPANY, THE AGENT, THE DESIGNATED BIDDERS AND THE BANKS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT OR ANY
DOCUMENT RELATED HERETO. THE GUARANTORS, THE COMPANY, THE AGENT, THE
DESIGNATED BIDDERS AND THE BANKS EACH WAIVE PERSONAL SERVICE OF ANY
SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER
MEANS PERMITTED BY ILLINOIS LAW.

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4.11 WAIVER OF JURY TRIAL. THE GUARANTORS, THE COMPANY,
THE BANKS AND THE AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY
OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
GUARANTY, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. THE GUARANTORS, THE COMPANY, THE BANKS, THE DESIGNATED BIDDERS
AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED
BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES
FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY
OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY
OF THIS GUARANTY OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR
THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS GUARANTY AND THE OTHER LOAN DOCUMENTS.

4.12 Nature of Obligations. All obligations and
liabilities of the Guarantors hereunder shall be joint and several.

4.13 Certain Limitations. Anything contained in this
Guaranty to the contrary notwithstanding, the obligations of each Guarantor
hereunder shall be limited to a maximum aggregate amount equal to the greatest
amount that would not render such Guarantor's obligations hereunder subject to
avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11
of the Bankruptcy Code or any provisions of applicable state law.

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

4.15 Headings. Section and other headings used in this
Guaranty are for convenience only and shall not affect the construction of this
Guaranty.

4.16 Entire Agreement. This Guaranty (a) integrates all
the terms and conditions mentioned herein or incidental hereto, (b) supersedes
all oral negotiations and prior writings with respect to the subject matter
hereof, and (c) is intended by the parties as the final expression of the
agreement with respect to the terms and conditions set forth in this Guaranty
and as the complete and exclusive statement of the terms agreed to by the
parties.

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[SIGNATURE PAGES FOLLOW]

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<PAGE> 165
IN WITNESS WHEREOF, the Guarantors have executed this Guaranty by
their duly authorized officers as of the day and year first above written.

BAND-IT-IDEX, INC.

By:
----------------------------------
Title:
-------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

CORKEN, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

LUBRIQUIP, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

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<PAGE> 166
PULSAFEEDER, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

STRIPPIT, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

VIBRATECH, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

S-2
<PAGE> 167
VIKING PUMP, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

WARREN RUPP, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

HALE PRODUCTS, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

S-3
<PAGE> 168
MICROPUMP, INC.

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

DUNJA VERWALTUGSGESELLSCHAFT mbH

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

BANK OF AMERICA ILLINOIS,
as Agent

By:
-------------------------------
Title:
----------------------------

S-4
<PAGE> 169
EXHIBIT A

FORM OF SUPPLEMENT TO THE AMENDED AND RESTATED
SUBSIDIARY GUARANTY AGREEMENT

This Supplement No. ________ dated as of _______________ (this
"Supplement") to the Amended and Restated Subsidiary Guaranty Agreement (as
defined below) is made by _________________________________, a
_________________ corporation ("New Guarantor"), in favor of the Agent and
Banks (as defined below).

RECITALS:

A. Idex Corporation, a Delaware corporation (the "Company"), is a
party to that certain Third Amended and Restated Credit Agreement dated as of
July 17, 1996 (as amended, restated, supplemented or otherwise modified from
time to time, the "Credit Agreement"), with Bank of America Illinois, as Agent
for itself (in such capacity the "Agent") and the financial institutions from
time to time party to the Credit Agreement (the "Banks").

B. New Guarantor is a Subsidiary of the Company (as defined in
the Credit Agreement).

C. As a condition precedent to their entering into the Credit
Agreement, the Agent and the Banks thereunder required the Company to cause
certain of its Subsidiaries to execute and deliver that certain Amended and
Restated Subsidiary Guaranty Agreement dated as of July 17, 1996 (as heretofore
or hereafter amended, restated, supplemented or otherwise modified from time to
time, the "Subsidiary Guaranty Agreement").

D. The proceeds of Credit Extensions (as defined in the Credit
Agreement) heretofore have been and hereafter will be used in part to enable
the Company to make valuable transfers to each of the Guarantors (including New
Guarantor) in connection with the operation of its businesses.

E. The Company and New Guarantor are engaged in related
businesses, and New Guarantor will derive substantial direct and indirect
benefit from the making of the Credit Extensions.

F. Pursuant to Section 7.13 of the Credit Agreement, the Company
and the Company's Subsidiaries are required to cause each Domestic Subsidiary
which is also a Material Subsidiary that was not in existence (or not such a
Subsidiary) on the date of the Credit Agreement to become a Guarantor under the
Subsidiary Guaranty Agreement upon becoming a Subsidiary.

G. Section 4.6 of the Subsidiary Guaranty Agreement provides that
additional Subsidiaries of the Company may become Guarantors under the
Subsidiary Guaranty Agreement by execution and delivery of an instrument in the
form of this Supplement.

-1-
<PAGE> 170
H. In consideration of the premises and to induce the Banks to
continue to make Credit Extensions, New Guarantor hereby agrees as follows:

1. Definitions. Each capitalized term used herein and not
otherwise defined herein shall have the meaning assigned to such term in the
Subsidiary Guaranty Agreement or, if not defined herein or in the Subsidiary
Guaranty Agreement, in the Credit Agreement.

2. Guaranty of Obligations. In accordance with Section 4.6
of the Subsidiary Guaranty Agreement, New Guarantor, by its execution and
delivery of this Supplement, hereby becomes a Guarantor under the Subsidiary
Guaranty Agreement for all purposes thereunder with the same force and effect
as if originally named therein as a Guarantor, without further action, approval
or consent by any other Person, and New Guarantor hereby (a) agrees to all the
terms and provisions of the Subsidiary Guaranty Agreement applicable to it as a
Guarantor thereunder and (b) represents and warrants that the representations
and warranties deemed to be made by it as a Guarantor thereunder are true and
correct in all material respects on and as of the date hereof. Each reference
to a "Guarantor" in the Subsidiary Guaranty Agreement shall be deemed for all
purposes to include New Guarantor. All of the terms of the Subsidiary Guaranty
Agreement are hereby incorporated in their entirety.

3. Representations and Warranties. New Guarantor represents
and warrants to the Beneficiaries that this Supplement has been duly
authorized, executed and delivered by it and constitutes its legal, valid and
binding obligation, enforceable against it in accordance with its terms.

4. Effect of Supplement. Upon the effectiveness hereof, each
reference in the Subsidiary Guaranty Agreement to "this Guaranty," "hereunder,"
"hereof," "herein," or words of like import referring to the Subsidiary
Guaranty Agreement and each reference in the other Loan Documents to the
"Subsidiary Guaranty Agreement," "thereunder," "thereof," or words of like
import referring to the Subsidiary Guaranty Agreement shall mean and be a
reference to the Subsidiary Guaranty Agreement as amended by this Supplement.
The Subsidiary Guaranty Agreement shall be deemed to be amended wherever and as
necessary to reflect the foregoing amendments.

5. Miscellaneous Provisions. Each of the provisions set
forth in Sections 4.6 through 4.16 (inclusive) of the Subsidiary Guaranty
Agreement is hereby incorporated by reference mutatis mutandis with the same
effect as if such provisions had been set forth herein with each reference
therein to "this Guaranty" deemed to be a reference to "this Supplement" and
each reference to a "Guarantor" deemed to be a reference to "New Guarantor".

[SIGNATURE PAGE FOLLOWS]

-2-
<PAGE> 171
IN WITNESS WHEREOF, the New Guarantor has caused this
Supplement No. ____ to the Subsidiary Guaranty Agreement to be duly executed
and delivered by its properly and duly authorized officer as of the date first
written above.

[NEW GUARANTOR]

By:
-----------------------------------
Title:
--------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention:
----------------------------
Facsimile No.: (312) 498-3940

Accepted:

BANK OF AMERICA ILLINOIS,
as Agent

By:
----------------------------------
Title:
-------------------------------

-3-
<PAGE> 172

EXHIBIT 2.02

FORM OF AMENDED AND RESTATED PROMISSORY NOTE

$_______________ (Dollar Equivalent) Chicago, Illinois
_____ __, 1996

FOR VALUE RECEIVED, the undersigned, IDEX Corporation, a Delaware
corporation (the "Company"), hereby unconditionally promises to pay to the
order of _________________ (the "Bank") at the office of the Agent (as defined
in the Credit Agreement referred to below) at 231 South LaSalle Street,
Chicago, Illinois 60697, in the Applicable Currency in which such Loan was
made, in funds customary for the settlement of international transactions in
such Applicable Currency and in immediately available funds, the aggregate
unpaid principal amount of all Loans made by the Bank to the Company pursuant
to Section 2.02 of the Credit Agreement (as hereinafter defined). The Company
acknowledges that Loans, subject to the terms and conditions of the Credit
Agreement, may be made in currencies other than Dollars and agree to repay or
prepay, as the case may be, all such Loans in the Applicable Currency in which
such Loan was made in the manner set forth in the Credit Agreement, regardless
of whether the Dollar Equivalent thereof at the time of payment is less than,
equal to or greater than the Commitment of the Bank or the Dollar Equivalent of
such Loan at any other time. Except as expressly provided by the Credit
Agreement with respect to currency fluctuations, the Company agree that the
Dollar Equivalent of all Loans made by such Bank shall not exceed
_____________ ($_________). The Company further agrees to pay interest in like
money at such office on the unpaid principal amount hereof from time to time
outstanding at the applicable interest rate per annum determined as provided
in, and payable as specified in, Article II of the Credit Agreement.

The holder of this Note is authorized to record the date, Type,
currency and amount of each Loan made by the Bank pursuant to Section 2.02 of
the Credit Agreement, each continuation thereof, the date of each interest rate
conversion pursuant to Sections 2.04 of the Credit Agreement and the Dollar
Equivalent principal amount subject thereto, the date and amount of each
payment or prepayment
<PAGE> 173
of principal hereof and, in the case of each Offshore Rate Loan, the length of
the Interest Period with respect thereto on the Schedules annexed hereto and
made a part hereof (or on any other record customarily maintained by such Bank
with respect to this Note) or otherwise on the records of the Bank, and any
such recordation shall (in the absence of manifest error) constitute prima
facie evidence of the accuracy of the information recorded; provided, however,
that the failure to make any such recordation shall not affect the obligations
of the Company in respect of such Loan.

This Note is one of the Notes referred to in that certain Third
Amended and Restated Credit Agreement dated as of July 17, 1996 (as amended,
restated, supplemented or otherwise modified from time to time, the "Credit
Agreement") among the Company, Bank of America Illinois, as Agent, and the
Banks named therein, and is subject to the provisions thereof and to optional
and mandatory prepayment in whole or in part as provided therein. Terms
defined in the Credit Agreement are used herein with their defined meanings
unless otherwise defined herein.

This Note is delivered in substitution and replacement of, but not in
payment or as a novation of, certain notes previously executed by the Company
to evidence loans under the Original Credit Agreement, First Amended and
Restated Credit Agreement and the Existing Credit Agreement, and any and all
outstanding amounts due pursuant to such notes, including without limitation,
all accrued and unpaid interest, shall be evidenced hereby and paid in
accordance with the terms hereof.

Upon the occurrence and during the continuance of any one or more of
the Events of Default specified in the Credit Agreement, all amounts then
remaining unpaid on this Note may become, or may be declared to be, immediately
due and payable, all as provided therein.

The Company represents and warrants that the Obligations hereunder
constitute "Senior Indebtedness" under the "Bank Credit Agreement" as such
terms are defined in the Subordinated Debt Indenture; provided, however, that
if for any reason such Indebtedness or any portion thereof does not constitute
such Senior Indebtedness under the Bank Credit Agreement, the Company, to such
extent, hereby designates the Obligations hereunder as "Designated

2
<PAGE> 174
Senior Indebtedness" pursuant to the terms of the Subordinated Debt Indenture.

All parties now and hereafter liable with respect to this Note,
whether maker, principal, surety, guarantor, endorser or otherwise, hereby
waive presentment, demand, protest and all other notices of any kind.

3
<PAGE> 175
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS.

IDEX CORPORATION

By:
---------------------------
Title:
---------------------

4
<PAGE> 176
Schedule A to
Promissory Note

BASE RATE LOANS AND
REPAYMENTS OF BASE RATE LOANS

<TABLE>
<CAPTION>
Unpaid
Amount Amount Principal
Converted Converted Balance
Amount of to Amount of to of
Base Rate Base Rate Principal Offshore Rate Base Rate Notation
Date Loans Loans Repaid Loans Loans Made By
---- --------- --------- --------- ------------- --------- --------
<S> <C> <C> <C> <C> <C> <C>

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

---- --------- --------- --------- --------- --------- --------
</TABLE>

5
<PAGE> 177
Schedule B to
Promissory Note

OFFSHORE CURRENCY LOANS AND
REPAYMENTS OF OFFSHORE CURRENCY LOANS

<TABLE>
<CAPTION>
Interest
Amount Period and Amount Unpaid
Converted Offshore Rate Converted Principal
Amount of to with Amount of to Balance of
Offshore Currency Offshore Rate respect Principal Base Rate Offshore Currency Notation
Date Loans Loans thereto Repaid Loans Loans Made By
- ---- ----------------- ------------- ------------- --------- --------- ----------------- --------
<S> <C> <C> <C> <C> <C> <C> <C>

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

- ---- --------- --------- --------- --------- --------- --------- --------
</TABLE>

6
<PAGE> 178
Schedule C to
Promissory Note

OFFSHORE RATE LOANS AND
REPAYMENTS OF OFFSHORE RATE LOANS

<TABLE>
<CAPTION>
Interest
Period and Unpaid
Offshore Rate Principal
Amount of with Amount of Balance of
Offshore Rate Agreed Alternative respect Principal Offshore Rate Notation
Date Loan Currency thereto Repaid Loans Made By
- ---- ------------- ------------------ ------------- --------- ------------- --------
<S> <C> <C> <C> <C> <C> <C>

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

- ---- --------- --------- --------- --------- --------- --------
</TABLE>

7
<PAGE> 179
EXHIBIT 2.03(a)

FORM OF NOTICE OF BORROWING(1)

Date:
-------------------

Bank of America Illinois, as Agent
231 South LaSalle Street
Chicago, Illinois 60697
Attention:
----------------------------
Telecopy:
----------------------------

Dear Sir or Madam:

1. Amount of the Borrowing
(in an aggregate amount ------------------
not less than the
Minimum Tranche)(2)

2. Borrowing Date
------------------

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

(1) Such irrevocable notice shall be given to the Agent prior to 10:30 a.m.,
Chicago time, four Business Days prior to the requested Borrowing Date,
in the case of Offshore Currency Loans, two Business Days prior to the
requested Borrowing Date, in the case of Offshore Rate Loans denominated
in Dollars, and on the requested Borrowing Date, in the case of Base Rate
Loans.

(2) In the case of a Borrowing comprised of Offshore Currency Loans, specify
the Applicable Currency.
<PAGE> 180
(a Business Day)

3. Type of Loans comprising
the Borrowing ------------------

4. Duration of the
Interest Period ------------------
applicable to such
Loans(3)

The undersigned represents and warrants that the Borrowing
requested hereby complies with the requirements of Section 2.03(a), and the
undersigned confirms that it has satisfied the conditions set forth in Section
5.02 of the Credit Agreement.

IDEX CORPORATION

By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------

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

(3) If this Notice of Borrowing fails to specify the duration of the Interest
Period for any Borrowing comprised of Offshore Rate Loans, such Interest
Period shall be one month.

2
<PAGE> 181
EXHIBIT 2.04

FORM OF NOTICE OF CONVERSION/CONTINUATION(1)

Bank of America Illinois, as Agent
231 South LaSalle Street
Chicago, Illinois 60697
Attention:
--------------------------
Telecopy:
---------------------------
, 199
-------------- -
Dear Sir or Madam:

Reference is made to that certain Third Amended and Restated
Credit Agreement, dated as of July 17, 1996 (as amended, restated, supplemented
or otherwise modified from time to time, the "Credit Agreement"), among IDEX
Corporation (the "Company"), the several financial institutions from time to
time party to this Agreement (collectively, the "Banks"; individually, a
"Bank"), and Bank of America Illinois, as agent for the Banks (the "Agent").
Capitalized terms used herein but not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement. The undersigned, IDEX
Corporation, hereby gives notice pursuant to Section 2.04 of the Credit
Agreement that it (i) elects, as of any Business Day, in the case of Base Rate
Committed Loans, or as of the last day of the applicable Interest Period, in
the case of any other Type of Committed Loans, to convert any such Loans (or
any part thereof in an amount not less than the Minimum Tranche) into Loans in
Dollars of any other Type; or (ii) elects, as of the last day of the applicable
Interest Period, to continue any Committed Loans having Interest Periods
expiring on such day (or any part thereof in an amount not less than the
Minimum

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

(1) This Notice of Conversion/Continuation must be received by the Agent
not later than 10:30 a.m. Chicago time, (i) at least two Business Days
in advance of the Conversion/Continuation Date, if the Committed Loans
are to be converted into or continued as Offshore Rate Committed Loans
denominated in Dollars; (ii) at least four Business Days in advance of
the continuation date, if the Committed Loans are to be continued as
Offshore Currency Committed Loans; and (iii) on the
Conversion/Continuation Date, if the Committed Loans are to be
converted into Base Rate Committed Loans.
<PAGE> 182
Tranche),(2) and sets forth below the terms on which such conversion or
continuation is requested to be made.

(A) Proposed Conversion/
Continuation Date
----------

(B) Aggregate amount of Committed Loans
to be converted or continued
----------

(D) Duration of the requested Interest
Period applicable to such Committed
Loans
----------

IDEX CORPORATION

By:
-------------------------------------
Name:
--------------------------------
Title:
-------------------------------

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

(2) If at any time the aggregate amount of Offshore Rate Committed Loans
denominated in Dollars in respect of any Committed Borrowing is
reduced, by payment, prepayment or conversion of part thereof to be
less than the Minimum Tranche, such Offshore Rate Loans denominated in
Dollars shall automatically convert into Base Rate Loans.

-2-
<PAGE> 183
EXHIBIT 2.07(b)

FORM OF INVITATION FOR COMPETITIVE BIDS

Via Facsimile

To the Banks and Designated Bidders Listed on Annex A attached hereto:

Ladies and Gentlemen:

Reference is made to that certain Third Amended and Restated Credit
Agreement dated as of July 17, 1996 (as amended from time to time, the "Credit
Agreement"), among IDEX Corporation (the "Company"), the several financial
institutions from time to time party to this Agreement (collectively, the
"Banks"; individually, a "Bank"), and Bank of America Illinois, as agent for
the Banks (the "Agent"). Capitalized terms used herein have the meanings
specified in the Credit Agreement.

Pursuant to subsection 2.07(b) of the Credit Agreement, you are hereby
invited to submit offers to make Bid Loans to the Company based on the
following specifications:

1. Date of Bid Borrowing: _______________, 199_;

2. Aggregate amount of Bid Borrowing: $___________________;

3. The Bid Loan shall be [LIBOR Bid Loans] [Absolute
Rate Bid Loans]; and

4. Interest Period[s]: ____________________, [________________]
and [________________].

All Competitive Bids must be in the form of Exhibit 2.07(c) to the
Credit Agreement and must be received by the Agent no later than 8:30 a.m.
(Chicago time) on ___________, 199_.
<PAGE> 184
BANK OF AMERICA ILLINOIS, as Agent

By:
------------------------------
Title:
---------------------------

2
<PAGE> 185
Annex A
TO EXHIBIT F

List of Banks

Bank of America Illinois, as a Bank

Facsimile: (___) ___-____

[Bank]

Facsimile: (___) ___-____

[Bank]

Facsimile: (___) ___-____

[Bank]

Facsimile: (___) ___-____

[Bank]

Facsimile: (___) ___-____

3
<PAGE> 186
EXHIBIT 2.07(c)

FORM OF COMPETITIVE BID

, 199
---------------- -
Bank of America Illinois, as Agent
231 South LaSalle Street
Chicago, IL 60697
Attention:
------------------------

Ladies and Gentlemen:

Reference is made to the Third Amended and Restated Credit Agreement
dated as of July 17, 1996 (as amended from time to time, the "Credit
Agreement"), by and among IDEX Corporation (the "Company"), the several
financial institutions from time to time party to this Agreement (collectively,
the "Banks"; individually, a "Bank"), and Bank of America Illinois, as agent
for the Banks (the "Agent"). Capitalized terms used herein have the meanings
(if any) specified in the Credit Agreement.

In response to the Competitive Bid Request of the Company dated
_____________, 199_ and in accordance with subsection 2.07(c)of the Credit
Agreement, the undersigned Bank offers to make [a] Bid Loan[s] thereunder in
the following principal amount[s] at the following interest rates for the
following Interest Period[s]:

Date of Bid Borrowing: ________________, 199_

Aggregate Maximum Bid Amount: $__________________

[LIBOR Bid Margin: ___________]

[Absolute Rate: ____________]

[NAME OF BANK/DESIGNATED BIDDER]

By:
------------------------------------

Title:
---------------------------------

<PAGE> 187
EXHIBIT 5.01(d)

FORM OF LEGAL OPINION OF COMPANY'S COUNSEL

_____ __, 1996

Bank of America Illinois, as Agent
231 South LaSalle Street
Chicago, Illinois 60697

Attention: ___________

Re: Idex Corporation

1. The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite corporate power and authority to own and operate its properties
and to carry on its business as now conducted. The Company has the corporate
power and authority to execute, deliver and perform its obligations under the
Credit Agreement, and to carry out the transactions contemplated by each
thereof.

2. Each of the Domestic Subsidiaries is a corporation
duly organized, validly existing and in good standing under the laws of its
state of incorporation and has all requisite corporate power to own and operate
its properties and to carry on its business as now conducted. Each Domestic
Subsidiary has the corporate power and authority to execute, deliver and
perform its obligations under the Consent and to carry out the transactions
contemplated thereby.

3. The execution, delivery and performance of the Credit
Agreement and the other Loan Documents to which the Company is a party have
been duly authorized by all necessary corporate action on the part of the
Company. The Credit Agreement and the other Loan Documents to which the
Company is a party constitute the legally valid and binding obligation of the
Company, enforceable against the Company in accordance with their terms. The
Amended and Restated Subsidiary Guarantee Agreement (i) has been duly
<PAGE> 188
executed and delivered by the Domestic Subsidiaries and (ii) constitutes a
legally valid and binding obligation of the Domestic Subsidiaries, enforceable
against the Domestic Subsidiaries in accordance with their terms.

4. None of the execution and delivery of the Credit
Agreement or the other Loan Documents to which the Company is a party by the
Company, and the compliance with and performance of the terms and conditions
thereof by the Company on or prior to the date hereof (A) conflicts with,
results in a breach or violation of, or constitutes a default under, any of the
terms, conditions or provisions of (x) the Restated Certificate of
Incorporation or Bylaws of the Company, (y) any term of any material indenture,
loan agreement or other Instrument evidencing borrowed money, or any material
order, writ, judgment or decree, in each case known to us, to which the Company
is a party or by which any of the Company's properties or assets are bound, or
(z) any Illinois or United States federal statute, rule or regulation or the
General Corporation Law of Delaware, or (B) results in the creation of any
Security Interest upon any of the properties or assets of the Company under any
agreement referred to in clause (y) above (other than Security Interests
created pursuant to any of the Instruments executed pursuant to the Credit
Agreement).

5. None of the execution and delivery of the Amended and
Restated Subsidiary Guaranty Agreement by each Subsidiary Guarantor, and the
compliance with and performance of the terms and conditions thereof by each
Subsidiary Guarantor on or prior to the date hereof (A) conflicts with, results
in a breach or violation of, or constitutes a default under, any of the terms,
conditions or provisions of (x) the Restated Certificate of Incorporation or
Bylaws of any Subsidiary Guarantor, (y) any term of any material indenture,
loan agreement or other Instrument evidencing borrowed money, or any material
order, writ, judgment or decree, in each case known to us, to which any
Subsidiary Guarantor is a party or by which any of a Subsidiary Guarantor's
properties or assets are bound, or (z) any Illinois or United States federal
statute, rule or regulation or the General Corporation Law of Delaware, or (B)
results in the creation of any Security Interest upon any of the properties or
assets of any Subsidiary Guarantor under any agreement referred to in clause
(y) above (other than Security Interests created pursuant to any of the
Instruments executed pursuant to the Credit Agreement).

-2-
<PAGE> 189
6. No governmental consents, approvals, authorizations,
registrations, declarations or filings are required by the Company or any
Subsidiary Guarantor in connection with (i) the due execution, delivery and
performance by any such party of any Loan Document or (ii) the perfection of or
the exercise by any such party of any of its rights and remedies under any Loan
Document, except for any requisite compliance with federal and state securities
laws in connection with any sale of any portion of such property under any Loan
Document.

7. To the best of our knowledge, there are no actions,
suits or proceedings pending or threatened against the Company or any
Subsidiary Guarantor (other than actions, suits or proceedings disclosed to
Banks in [Schedule 6.05] to the Credit Agreement) with respect to the Credit
Agreement, any Instrument executed pursuant thereto, or the transactions
contemplated by any thereof.

8. The Notes and all other monetary Liabilities are
within the definition of "Senior Indebtedness" contained in the Subordinated
Debt Indenture and referred to in the Subordinated Notes and are entitled to
the benefits of the subordination provisions created by the Subordinated Debt
Indenture and referred to in the Subordinated Notes.

-3-
<PAGE> 190
EXHIBIT 7.02(b)

FORM OF COMPLIANCE CERTIFICATE

The undersigned, being the __________ of IDEX Corporation (the
"Company"), pursuant to Section 7.02(b) of that certain Third Amended and
Restated Credit Agreement (as amended, restated, supplemented or otherwise
modified from time to time, the "Credit Agreement"; capitalized terms used
herein but not otherwise defined herein have the meanings ascribed to such
terms in the Credit Agreement) dated as of July 17, 1996 by and among the
Company, the several financial institutions from time to time party to this
Agreement (collectively, the "Banks"; individually, a "Bank"), and Bank of
America Illinois, as agent for the Banks (the "Agent"), hereby certifies that:

(i) The Company has complied and is in compliance
with all the terms, covenants and conditions
of the Credit Agreement, except as set forth
on Schedule I hereto;

(ii) There exists no Default or Event of Default
under the Credit Agreement, except as set
forth below;

(iii) Except as set forth below, the
representations and warranties contained in
Article VI of the Credit Agreement and in the
other Loan Documents are true and correct in
all material respects on the date hereof; and

(iv) Schedule I attached hereto sets forth
financial data and computations evidencing
compliance (or non-compliance) with the
covenants set forth in Section 8.16 of the
Credit Agreement, all of which data and
computations are true, complete and correct.

Described below are the exceptions, if any, to paragraph (ii),
listing, in detail, the nature of the condition or event, the period during
which it has existed and the action which the Company

<PAGE> 191
has taken, is taking or proposes to take with respect to each such condition or
event:

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

2
<PAGE> 192
The foregoing certifications, together with the computations set forth
in Schedule I hereto and the financial statements delivered with this
Compliance Certificate in support hereof, are made and delivered this ______
day of ______ ______, 19__.

IDEX CORPORATION

By:
------------------------------------

Name:
----------------------------------

Title:
--------------------------------

3
<PAGE> 193
SCHEDULE I

<TABLE>
<S> <C>
SECTION 8.05(F)

1. Permitted aggregate Subordinated Debt of the Company $150,000,000

2. Actual aggregate Subordinated Debt of the Company $________

SECTION 8.16 -- FINANCIAL COVENANTS

SECTION 8.16(A) -- FIXED CHARGE COVERAGE RATIO

1. Required Fixed Charge Coverage Ratio for the applicable period 1.25 to 1.0

2. Actual Fixed Charge Coverage Ratio for the applicable period

(a) EBITDA for the applicable period, less Capital $________
Expenditures plus Consolidated Rental Expense, in each
case for such four fiscal quarter period, as applicable

(b) Consolidated Fixed Charges for the applicable period $________

SECTION 8.16(B) -- LEVERAGE RATIO

1. Required Leverage Ratio for the applicable period 70%

2. Actual Leverage Ratio for the applicable period

(a) Funded Debt $________

(b) Total Capitalization $________

<PAGE> 194
<TABLE>
<S> <C>
SECTION 8.16(C) -- FUNDED DEBT TO EBITDA

1. Maximum Funded Debt to EBITDA ratio for the applicable fiscal _____ to 1.0
year

2. Actual Funded Debt to EBITDA ratio for the applicable fiscal
year

(a) Funded Debt as of the last day of the fiscal quarter $________

(b) EBITDA as of the last day of the fiscal quarter $________

-2-
<PAGE> 195

EXHIBIT 11.08

FORM OF ASSIGNMENT AND ACCEPTANCE

Reference is made to that certain Third Amended and Restated
Credit Agreement dated as of July 17, 1996 (as amended, restated, supplemented
or otherwise modified from time to time, the "Credit Agreement") among IDEX
Corporation (the "Company" or the "Borrower"), the several financial
institutions from time to time party to this Agreement (collectively, the
"Banks"; individually, a "Bank"), and Bank of America Illinois, as agent for
the Banks (the "Agent"). Capitalized terms used herein but not otherwise
defined herein shall have the respective meanings assigned to such terms in the
Credit Agreement.

__________________________________ (the "Assignor") and
__________________________ (the "Assignee") hereby agree as follows:

1. The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor without recourse and
without representation or warranty, a ________% interest ($5,000,000 minimum)
in and to all of the Assignor's rights, benefits and obligations under such
Assignor's Revolving Commitment with respect to the Borrowers, such Assignor's
Revolving Loans and such Assignor's Note.

2. (a) The Assignor represents and warrants that it is the legal and
beneficial owner of the interests being assigned by it hereunder and that such
interests are free and clear of any adverse claim.

(b) The Assignee acknowledges and agrees that neither the Assignor
nor the Agent makes any representation or warranty or assumes any
responsibility with respect to any statements, warranties or representations
made in or in connection with any Loan Document or the authorization,
execution, legality, validity, enforceability, genuineness, sufficiency or
value of any Loan Document or any other instrument or document furnished
pursuant thereto.

(c) The Assignee acknowledges and agrees that neither the Assignor
nor the Agent makes any representation or
<PAGE> 196
warranty or assumes any responsibility with respect to the financial condition
or creditworthiness of the Borrowers or any other Person or the performance or
observance by the Borrowers or any other Person of any obligations under any
Loan Document or any other instrument or document furnished pursuant thereto.
The Assignee acknowledges and agrees that (i) the Assignee has made and will
continue to make such inquiries and has taken and will continue to take such
care on its own behalf as would have been the case had the Assignee made the
Assignor's Revolving Commitment directly to the Borrowers without the
intervention of such Assignor, the Agent or any other Person, and (ii) the
Assignee has made and will continue to make its own credit analysis and
decisions relating to the Loan Documents independently and without reliance
upon the Assignor, the Agent or any other Person, and based on such documents
and information as it has deemed appropriate.

(d) The Assignor attaches the Note referred to in paragraph 1
above and requests that the Agent exchange such Note for a new Note, dated
___________________, 19__, in the principal amount of $_________, payable to
the order of the Assignee.

3. The effective date for this Assignment and Acceptance shall be
________________, 19___ (the "Effective Date") [at least five (5) Business Days
after the execution hereof]. Following the execution of this Assignment and
Acceptance by the Assignor and the Assignee, it will be delivered to the Agent
for acceptance by the Agent, and the Borrowers, as applicable, and the Assignor
shall pay to the Agent a $3,500 assignment fee. Following such payment, and
acceptance by the Agent, and the Borrowers, as applicable, of this Assignment
and Acceptance, a photostatic copy hereof shall be delivered to the Borrowers.
Within five (5) Business Days after the Borrowers' receipt of such photostatic
copy, the Borrowers shall execute and deliver to the Agent the new Note. The
Agent shall deliver the new Note to the payee(s) thereof and shall mark the
Note referred to in paragraph 1 above as "replaced" and shall deliver the same
to the Borrowers.

4. Upon such acceptance by the Agent, and the Borrowers, as
applicable, as of the Effective Date:

(a) The Assignee, in addition to any rights, benefits and
obligations under the Loan Documents held by it

2
<PAGE> 197
immediately prior to the Effective Date, shall have the rights, benefits and
obligations of a Bank under the Loan Documents that have been assigned to it
(including, but not limited to, obligations to the Borrowers under the Loan
Documents) pursuant to this Assignment and Acceptance. The Assignee shall
become a Bank for all purposes of the Credit Agreement, and execution hereof
shall be deemed to be execution thereof; and

(b) The Assignor, to the extent provided in this Assignment and
Acceptance, shall relinquish its rights and benefits and be released from its
obligations under the Credit Agreement (and, in the case of an Assignment
covering all or the remaining portion of the Assignor's rights, benefits and
obligations under the Loan Documents, the Assignor shall cease to be a Bank
under the Loan Documents).

5. Upon such acceptance by the Agent, and the Borrowers, as
applicable, from and after the Effective Date, the Agent shall make payments
under the Credit Agreement in respect of the interests assigned hereby
(including, without limitation, all payments of principal, interest and fees
with respect thereto) to the Assignee. The Assignor and the Assignee shall
make all appropriate adjustments in payments under the Credit Agreement for
periods prior to the Effective Date directly between themselves.

6. The Assignor agrees to give written notice of this Assignment and
Acceptance to the Agent, each Bank and the Borrowers, which written notice
shall include the addresses and related information with respect to the
Assignee.

7. The Assignee (a) represents and warrants to the Assignor, the
Agent and the Company that under applicable law and treaties no tax will be
required to be withheld by the Assignor with respect to any payments to be made
to the Assignee hereunder, (b) agrees to furnish (if it is organized under the
laws of any jurisdiction other than the United States or any State thereof) to
the Agent and the Company prior to the time that the Agent or Company is
required to make any payment of principal, interest or fees hereunder,
duplicate executed originals of either U.S. Internal Revenue Service Form 4224
or U.S. Internal Revenue Service Form 1001 (wherein the Assignee claims
entitlement to the benefits of a tax treaty that provides for a complete
exemption from U.S. federal income withholding tax on all payments hereunder)
and

3
<PAGE> 198
agrees to provide new Forms 4224 or 1001 upon the expiration of any previously
delivered form or comparable statements in accordance with applicable U.S. law
and regulations and amendments thereto, duly executed and completed by the
Assignee, and (c) agrees to comply with all applicable U.S. laws and
regulations with regard to such withholding tax exemption.

[signature page follows]

4
<PAGE> 199
8. THIS AGREEMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAW OF THE STATE OF ILLINOIS, WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES.

[NAME OF ASSIGNOR]

By:
-----------------------------
Title:
--------------------------

[NAME OF ASSIGNEE]

By:
-----------------------------
Title:
--------------------------

Accepted this ______ day of
_________________, 19___

BANK OF AMERICA ILLINOIS, AS AGENT

By:
-------------------------------
Title:
----------------------------

Accepted this ______ day of
_________________, 19___

IDEX CORPORATION

By:
-------------------------------
Title:
----------------------------

5
<PAGE> 200

EXHIBIT 11.09

FORM OF DESIGNATION AGREEMENT

Dated ______________, 19__

Reference is made to the Third Amended and Restated Credit
Agreement dated as of July 17, 1996 (the "Credit Agreement") among IDEX
Corporation, a Delaware corporation (the Company"), the several financial
institutions from time to time party to this Agreement (collectively, the
"Banks"; individually, a "Bank"), and Bank of America Illinois, as agent for
the Banks (the "Agent"). Terms defined in the Credit Agreement are used herein
with the same meaning.

________________ (the "Designator") and ______________ the
("Designee") agree as follows:

1. The Designator hereby designates the Designee, and the
Designee hereby accepts such designation, to have a right to make Bid Loans
pursuant to Section 2.06 of the Credit Agreement.

2. The Designator makes no representation or warranty and
assumes no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement or any other instrument or document furnished
pursuant thereto or (ii) the financial condition of the Company or the
performance or observance by the Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant
thereto.

3. The Designee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 6.11 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Designation Agreement; (ii) agrees that it will, independently and without
reliance upon the Agent, the Designator or any other Bank and based on such
documents and information as it shall deem appropriate at

<PAGE> 201
the time, continue to make its own credit decisions in taking or not taking
action under the Credit Agreement; (iii) confirms that it is an entity
qualified to be a Designated Bidder; (iv) appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers under the
Credit Agreement as are delegated to the Agent by the terms thereof, together
with such powers as are reasonably incidental thereto; (v) agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of the Credit Agreement are required to be performed by it as a
Designated Bidder; and (vi) specifies as its Lending Office with respect to Bid
Loans (and address for notices) the offices set forth beneath its name on the
signature page hereof.

4. Following the execution of this Designation Agreement by
the Designator and its Designee, it will be delivered to the Agent for
acceptance by the Agent. The effective date of this Designation Agreement
shall be the date of acceptance thereof by the Agent (the "Effective Date").

5. Upon such acceptance and recording by the Agent, as of the
Effective Date, the Designee shall be a party to the Credit Agreement as a
"Designated Bidder" with a right to make Bid Loans pursuant to Section 2.06 of
the Credit Agreement and the rights and obligations of a Designated Bidder
related thereto.

6. This Designation Agreement shall be governed by, and
construed in accordance with, the laws of the State of Illinois.

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

[NAME OF DESIGNATOR]

By:
------------------------
Title:

[NAME OF DESIGNEE]

By:
------------------------
Title:

2
<PAGE> 202
Lending Office (and
address for notices):
[Address]

Accepted [as of] the ___ day
of ____________, 19__

BANK OF AMERICA ILLINOIS

By:
--------------------------
Title:

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

<PAGE> 1
EXHIBIT 4.6

AMENDED AND RESTATED PLEDGE AGREEMENT

RECITALS:

A. The Company, the Agent and the Banks entered into that certain Third
Amended and Restated Credit Agreement dated as of July 17, 1996. The Third
Amended and Restated Credit Agreement as now in effect or hereafter extended,
renewed, modified, supplemented, amended or restated is hereinafter called the
"Credit Agreement".

B. The Banks are willing to continue to make certain Loans to the Company
and the Issuing Bank is willing to continue to issue Letters of Credit for the
account of the Company as provided in the Credit Agreement on the condition
(among others) that the Pledgors enter into this Agreement.

C. The Company has previously entered into pledges (See Recital D below)
pursuant to that certain Credit Agreement, among the Company, Agent and various
banking institutions, dated January 22, 1988 (herein, as amended by the First
Amendment dated as of May 22, 1989, a Letter Agreement dated as of May 7, 1991,
the Amended and Restated Credit Agreement dated as of May 4, 1992, the Second
Amended and Restated Credit Agreement dated as of January 29, 1993, which in
turn was amended by the First Amendment dated as of May 23, 1994, the Second
Amendment dated as of October 24, 1994, the Third Amendment dated as of
February 28, 1995, the Fourth Amendment dated November 1, 1995 and the Fifth
Amendment dated December 22, 1995), and such pledges are hereby deemed to be
amended and restated by this Agreement.

D. The Company is party to that certain Senior Pledge Agreement, dated
January 22, 1988, by and between the Company and Bank of America Illinois
(successor to Continental Illinois National Bank and Trust Company of Chicago).
That certain Senior Pledge Agreement was subsequently amended on the following
dates: May 7, 1991, May 4, 1992, October 24, 1994, and November 1, 1995.
Pursuant to these amendments, capital stock and intercompany notes of the
following subsidiaries were pledged by the Company: Corken, Inc. (successor to
CIC Acquisition Corp.); Pulsafeeder, Inc. (successor to PLF Acquisition
Corporation and MCL Acquisition Corporation); Hale Products, Inc.; and
Micropump, Inc. The foregoing Senior Pledge Agreement, as amended, is
hereinafter referred to as the "Original Pledge Agreement".

-1-
<PAGE> 2

E. In order to induce the Banks to continue to make such Loans available
to the Company and to induce the Issuing Bank to continue to issue such Letters
of Credit for the account of the Company, and for other valuable consideration,
the Company is required to execute and deliver this Agreement and to grant to
Agent under this Agreement a continuing Security Interest in

(1) all Pledged Notes; and

(2) all Pledged Shares.

F. Pledgor hereby agrees that the Original Pledge Agreement is hereby
amended and restated in its entirety as follows:

ARTICLE I
DEFINITIONS

1.1. Certain Terms. The following terms (whether or not underscored) when
used in this Agreement shall have the following meanings (such definitions to
be equally applicable to the singular and plural forms thereof):

"Agent" shall have the meaning provided in the preamble hereto.

"Banks" shall have the meaning provided in the preamble hereto.

"Company" shall have the meaning provided in preamble hereto.

"Collateral" shall have the meaning provided in Section 2.1 below.

"Credit Agreement" shall have the meaning provided in Recital A hereto.

"Default" shall mean any Event of Default or any event or condition which,
with notice or lapse of time or both, would constitute an Event of Default.

"Dividends" shall mean cash dividends and cash distributions made out of
capital surplus.

"Instrument" shall mean any document or writing (whether by formal
agreement, letter or otherwise) under which any obligation is evidenced,
assumed or undertaken, or any right to any security interest is granted or
perfected.

-2-
<PAGE> 3

"Intercompany Note" means a promissory note from a Subsidiary of the
Company to the Company in a form satisfactory to Agent and required to be
pledged pursuant to the Agreement.

"Obligations" shall have the meaning ascribed to it in the Credit
Agreement.

"Pledged Notes" shall mean all Intercompany Notes either in the form as
they currently exist and hereafter substantially in the form of Exhibit A
(with only such changes as are agreed to by the Agent) identified on Schedule
I attached hereto (as the same may be amended from time to time) which are now
being delivered by the Company to Agent or may from time to time hereafter be
delivered by the Company or any Subsidiary for the purpose of pledge under this
Agreement.

"Pledged Property" shall mean the Pledged Notes and/or the Pledged Shares.

"Pledged Shares" shall mean the certificates representing the shares of
the capital stock as identified on Schedule II attached hereto (as the same may
be amended from time to time) which are now being delivered by the Company to
Agent or may from time to time hereafter be delivered by the Company or any
Subsidiary for the purpose of pledge under this Agreement.

"Pledgor" shall have the meaning provided in the preamble hereto.

"Security Instrument" shall mean any security agreement, chattel mortgage,
assignment, financing or similar statement or notice, continuation statement,
other agreement or Instrument, or amendment or supplement to any thereof,
providing for, evidencing or perfecting any Security Interest.

"Security Interest" shall mean any interest in any real or personal
property or fixture which secures payment of performance of any obligation and
shall include any mortgage, lien, encumbrance, charge or other Security
Interest of any kind, whether arising under a Security Instrument or as a
matter of law, judicial process or otherwise.

-3-
<PAGE> 4

1.3. References to Parties. References to any party in this Agreement
shall include its permitted successors and assigns.

ARTICLE II
PLEDGE

2.1. Grant of Security Interest. As security for payment of all Obligations
of such Pledgor, each Pledgor hereby ratifies and confirms its pledge and grant
of a security interest pursuant to the Original Pledge Agreement and hereby
pledges, assigns and transfers to Agent and grants to Agent a continuing
security interest in and to the Pledged Property, whether now or hereafter
delivered by such Pledgor to Agent, together with all Dividends, Distributions,
interest and other payments and rights with respect thereto and all proceeds of
any of the foregoing (all of the items referred to in this Section 2.1 being
herein called the "Collateral"). Any Pledged Notes delivered by each Pledgor To
Agent which, notwithstanding any applicable requirement of this Agreement or
the Credit Agreement, were not endorsed by each Pledgor to the order of Agent,
and upon the occurrence of any Event of Default any other Collateral delivered
by each Pledgor to Agent which was not endorsed by each Pledgor to the order of
Agent, may be so endorsed by Agent on behalf of each Pledgor.

All advances, charges, costs and expenses, including reasonable attorneys'
fees, incurred or paid by Agent in exercising any right, power or remedy
conferred by this Agreement, or in the enforcement hereof or thereof, shall, to
the extent lawful, become a part of the Obligations secured hereby.

2.2. Release of Pledged Property.

(a) In the event that each Pledgor, to the extent permitted
under the Credit Agreement, disposes of all Pledged Shares issued by
any Subsidiary or any Subsidiary disposes of all or substantially all of
its assets then, upon the occurrence of such disposition and each
Pledgor's prepayment of such amounts, if any, then required by the Banks
to be paid on the Obligations, the Pledged Note issued by such Subsidiary
and/or, if applicable, the Pledged Shares issued by such Subsidiary, shall
cease to be Pledged Property and shall be released by the Agent to each
Pledgor. Any such release may occur pursuant to an escrow or other
arrangement for a concurrent disposition and release.

-4-
<PAGE> 5

occurred and is continuing and the proceeds thereof are not
applied to any of the Obligations, such Dividend or interest or
principal shall thereupon cease to be Pledged Property and shall
be deemed to be released by Agent to each Pledgor.

ARTICLE III
CERTAIN UNDERTAKINGS

3.1. Payments of Pledged Notes. Subject to the restrictions of Section 3.3
below, any Subsidiary which is obligated under any Pledged Note may prepay such
Pledged Note in whole or in part without premium or penalty.

3.2. Quarterly Reports. Each Pledgor shall provide each Bank, as part of
the financial information delivered quarterly pursuant to clause (b) of Section
7.01 of the Credit Agreement (commencing with the fiscal quarter ending June
30, 1996), a schedule, in form satisfactory to each Bank, setting forth as to
each Pledged Note on the last day of the fiscal quarter for which such
information is delivered:

(a) its maker, date and original principal amount;

(b) its actual outstanding principal amount on the last day
of such fiscal quarter;

3.3. Additional Undertakings. Except in connection with any action
permitted by Section 2.2, each Pledgor will not, without the prior written
consent of Agent,

(a) enter into any agreement amending, supplementing or
waiving any provision of any Pledged Note or compromising or
releasing or extending the time for payment of any obligation of
the maker thereunder; or

(b) take or omit to take any action the taking or omission
of which would result in any impairment or alteration of any
obligation of the maker of any Pledged Note.

ARTICLE IV
WARRANTIES, ETC.

Each Pledgor represents and warrants unto Agent and each Bank that at the
date of each pledge hereunder by each Pledgor to Agent of any Pledged Property,

(a) Each Pledgor is or will then be the lawful owner of,
and has or will have good and marketable title to (and has or
will have full right and authority to pledge and assign),

-5-
<PAGE> 6

such Pledged Property, free and clear of all liens or
encumbrances except any lien or security interest granted
pursuant hereto in favor of Agent or otherwise permitted by the
Credit Agreement;

(b) the Pledged Notes then pledged hereunder are in full
force and effect and are enforceable in accordance with their
respective terms, subject as to enforcement only to bankruptcy,
insolvency, reorganization, moratorium or similar laws at the
time in effect affecting the enforceability of the rights of
creditors generally and general principles of equity;

(c) the pledge of the Pledged Property then pledged
hereunder is effective to create a valid first lien on and a
first perfected security interest in such Pledged Property;

(d) in the case of any Pledged Shares, all of such Pledged
Shares have been duly and validly issued, are fully paid and
non-assessable; and

ARTICLE V
BENEFIT OF PLEDGED SECURITIES, ETC.

5.1. Protect Collateral. Except in connection with any action permitted by
Section 2.2. each Pledgor will not sell, assign, transfer, pledge or encumber
in any other manner the Collateral (except in favor of Agent hereunder). Each
Pledgor will warrant and defend the right and title herein granted unto Agent
in and to the Collateral (and all right, title and interest represented by the
Collateral) against the claims and demands of all Persons whomsoever except as
permitted by the Credit Agreement.

5.2. Stock Powers. Endorsements. etc. Each Pledgor agrees that all Pledged
Notes delivered by each Pledgor pursuant to this Agreement will be duly
endorsed by each Pledgor to the order of Agent and that all Pledged Shares
delivered by each Pledgor pursuant to this Agreement will be accompanied by
duly executed undated blank stock powers. Each Pledgor will, from time to time,
upon request of Agent, promptly execute such endorsements and deliver to Agent
such stock powers and similar documents, satisfactory in form and substance to
Agent, with respect to the Collateral as Agent may reasonably request and will,
from time to time, upon request of Agent, after the occurrence and during the
continuance of any Event of Default, promptly transfer any shares which are
part of the Collateral into the name of any nominee designated by Agent.

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<PAGE> 7

the date hereto and each Domestic Subsidiary which becomes a Material
Subsidiary after the date hereof, and 65% of shares of capital stock of each
direct Foreign Subsidiary which becomes a Material Subsidiary after the date
hereof, and all other securities, instruments and rights from time to time
received by or distributable to each Pledgor in respect of any Collateral.

Each Pledgor agrees to deliver (properly endorsed where required hereby or
requested by Agent) to Agent:

(a) after, but not prior to, the time that any Default of
the nature referred to in clause (f) or (g) of Section 9.01 of the
Credit Agreement or an Event of Default shall have occured and be
continuing, promptly upon receipt thereof by each Pledgor and
without any request therefor by Agent, all Dividends, all
interest and other cash payments and all cash proceeds of the
Pledged Property and other Collateral, all of which shall be held
by Agent as additional Collateral for use in accordance with
Section 5.5; and

(b) after a Default of the nature referred to in clause (f)
or (g) of Section 9.01 of the Credit Agreement or an Event of
Default shall have occurred, promptly upon request of Agent, such
proxies and other documents as may be necessary to allow Agent to
exercise the voting power with respect to any share of capital
stock included in the Collateral;

provided, however, that unless a Default of the nature referred to in clause
(f) or (g) of Section 9.01 of the Credit Agreement or an Event of Default
shall have occurred and be continuing, each Pledgor shall, subject to Article
III, be entitled:

(c) to exercise as it shall deem fit, but in a manner not
inconsistent with the terms of the Credit Agreement, Loan
Document, any Note or any Instrument executed pursuant thereto,
the voting power and all other incidental rights of ownership
with respect to any Pledged Shares or any Pledged Notes (subject
to each Pledgor's obligation to deliver to Agent such capital
stock and Subsidiary Notes in pledge hereunder); and

(d) to the prompt return from Agent of any and all such
Dividends, all interest and other cash payments and all cash
proceeds of the Pledged Property and other Collateral delivered
to the Agent in accordance with clause (a) of Section 5.3 after
payment in full of all Obligations then due or to become due
within 30 days thereafter.

All Dividends, Distributions, interest and payments which may at any time
and from time to time be held by each Pledgor but which each Pledgor is then
obligated to deliver to Agent, shall, until delivery to Agent, be held by each
Pledgor separate and apart from its other property in trust for Agent.

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<PAGE> 8

to exercise voting power with respect to any share of capital stock included in
the Collateral; provided, however, that no vote shall be cast or consent,
waiver or ratification given or action taken by each Pledgor that would impair
the Collateral or be inconsistent with or violate any provision of this
Agreement, the Credit Agreement, Loan Documents, any Note or any Instrument
executed pursuant to the Credit Agreement.

5.4. Actions upon Event of Default. Whenever an Event of Default shall
have occurred and be continuing, Agent shall have all rights and remedies of a
secured party after default under the Uniform Commercial Code as in effect in
the State of Illinois or other applicable law to the extent not inconsistent
with all rights provided hereby. Any notification required by law of intended
disposition by Agent of any of the Collateral shall be deemed reasonably and
properly given if given at least 30 days before such disposition. Without
limitation of the above, Agent may, upon direction of the Majority Banks, from
time to time, before the Obligations shall be declared due and payable, but
only if an Event of Default shall have occurred and be continuing, without
prior notice to each Pledgor, take all or any of the following actions:

(a) transfer all or any part of the Collateral into the name
of Agent or its nominee, with or without disclosing that such
Collateral is subject to the lien and security interest
hereunder;

(b) notify the parties obligated on any of the Collateral to
make payment to Agent of any amount due or to become due
thereunder;

(d) endorse any checks, drafts or other writings in each
Pledgor's name to allow collection of the Collateral; and

(e) take control of any proceeds of the Collateral.

(f) transfer all or any part of the Collateral into the name
of Agent or its nominee, with or without disclosing that such
Collateral is subject to the lien and security interest
hereunder;

(g) notify the parties obligated on any of the Collateral to
make payment to Agent of any amount due or to become due
thereunder;

-8-
<PAGE> 9

(h) enforce collection of any of the Collateral by suit or
otherwise, and surrender, release or exchange all or any part
thereof, or compromise or extend or renew for any period (whether
or not longer than the original period) any obligations of any
nature of any party with respect thereto;

(i) endorse any checks, drafts or other writings in each
Pledgor's name to allow collection of the Collateral;

(j) take control of any proceeds of the Collateral; and

(k) execute (in the name, place and stead of each Pledgor)
endorsements, assignments, stock powers and other instruments of
conveyance or transfer with respect to all or any of the
Collateral.

Each Pledgor understands that compliance with the federal securities laws,
applicable blue sky or other state securities laws or similar laws analogous in
purpose or effect may strictly limit the course of conduct of Agent if Agent
were to attempt to dispose of all or any part of the Collateral and may also
limit the extent to which or the manner in which any subsequent transferee of
the Collateral may dispose of the same. Accordingly, each Pledgor agrees that
IF ANY COLLATERAL IS SOLD AT ANY PUBLIC OR PRIVATE SALE, AGENT MAY ELECT TO
SELL ONLY TO A BUYER WHO WILL GIVE FURTHER ASSURANCES, SATISFACTORY IN FORM AND
SUBSTANCE TO AGENT, RESPECTING COMPLIANCE WITH THE REQUIREMENTS OF THE FEDERAL
SECURITIES ACT OF 1933, AS AMENDED; AND A SALE SUBJECT TO SUCH CONDITION SHALL
BE DEEMED COMMERCIALLY REASONABLE. Without limiting the generality of the
foregoing, the provisions of this paragraph would apply if, for example, Agent
were to place all or any part of the Collateral for private placement by an
investment banking firm, or if such investment banking firm purchased all or
any part of the Collateral for its own account, or if Agent placed all or any
part of the Collateral privately with a purchaser or purchasers.

5.5. Application of Moneys. Any moneys received by Agent upon payment to
it of any Collateral held by it or as proceeds of any of the Collateral may be
applied by Agent to the payment of any expenses incurred by it in connection
with the Collateral, including, without limitation, reasonable attorneys' fees
and legal expenses and all amounts payable by each Pledgor under Section 11.04
of the Credit Agreement. Any balance of such moneys so received by Agent shall
be applied by Agent:

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<PAGE> 10

(a) first, Ratably, (i) to the unpaid interest (including,
without limitation, post-petition interest) accrued and then due
on all Notes (including any premium, if any, thereon), and (ii)
to all unpaid closing, commitment and agents fees, if any,
accrued and then due;

(b) second, Ratably among all holders of Notes on account of
all principal of the Notes then due;

(c) third, if any Event of Default shall have occurred and
be continuing, Ratably l) to the unpaid interest accrued on all
Notes not then due, (ii) to the outstanding principal amount of
all Notes not then due, and (iii) to the payment in full of all
other items which constitute Obligations under the definition
thereof;

(d) fourth, if any Event of Default shall have occurred and
be continuing and all items which constitute Obligations under
the definition thereof, whether or not then due, shall have been
paid in full, ratably to all other Obligations to any Bank then
due; and

(e) fifth, if no Event of Default shall have occurred and be
continuing or after payment in full of all Obligations and other
obligations referred to above, to the payment to each Pledgor or
its successors or assigns, or as a court of competent
jurisdiction may direct, of any surplus then remaining from such
moneys.

ARTICLE VI
MISCELLANEOUS

6.1. Obligations Not Affected. The obligations of each Pledgor under this
Agreement shall remain in full force and effect without regard to, and shall
not be impaired or affected by:

(a) any amendment or modification or addition or supplement
to the Credit Agreement, or any Instrument contemplated thereby
or any assignment or transfer thereof, except amendments or
modifications hereto effected in accordance with Section 6.5;

(b) any exercise, non-exercise or waiver by Agent or any
Bank of any right, remedy, power or privilege under or in respect
of this Agreement, the Credit Agreement or any Instrument
executed pursuant hereto;

(c) any waiver, consent, extension, indulgence or other
action or inaction in respect of this Agreement, the Credit
Agreement or any Instrument executed pursuant hereto or any
assignment or transfer of any thereof; or

(d) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation, or the like, of each
Pledgor or any other Person, whether or not each Pledgor shall
have notice or knowledge of any of the foregoing.

-10-
<PAGE> 11

6.2. Protection of Collateral. Agent may from time to time, at its option,
perform any act which each Pledgor agrees hereunder to perform and which a
Pledgor or Pledgors fails to perform after being requested in writing to so
perform (it being understood that no such request need be given aver the
occurrence and during the continuance of any Event of Default) and Agent may
from time to time take any other action which Agent reasonably deems necessary
for the maintenance, preservation or protection of any of the Collateral or of
its security interest therein. Such Pledgor or Pledgors will, upon demand,
repay to Agent all moneys advanced by Agent in connection with the foregoing,
together with interest at a rate (or any maximum lesser rate permitted by
applicable law) per annum equal to the sum of the Base Rate from time to time
most recently announced by Agent plus 2%.

6.3. Agent Not Responsible. Agent is required to exercise reasonable care
in the custody and preservation of any of the Collateral in its possession;
however, Agent shall be deemed to have exercised reasonable care in the custody
and preservation of any of the Collateral if it takes such action for that
purpose as a Pledgor or Pledgors reasonably request in writing at times other
than upon the occurrence and during the continuance of any Event of Default,
but failure of Agent to comply with any such request shall at any time not in
itself be deemed a failure to exercise reasonable care.

6.4. Additional Pledges. If the Company or any Subsidiary hereafter
incorporates, acquires or otherwise obtains a Domestic Subsidiary which
is also a Material Subsidiary ("New Domestic Subsidiary"), then the Company
shall pledge or shall cause such Subsidiary to pledge to Agent all of the New
Domestic Subsidiary's Intercompany Notes, all of its Distributions, all of its
shares of capital stock and all other securities, instruments and rights from
time to time received by or distributable to each Pledgor in respect of any
Collateral. In addition, if the Company or any Domestic Subsidiary hereafter
incorporates, acquires or otherwise obtains a Foreign Subsidiary which is also
a Material Subsidiary ("New Foreign Subsidiary"), then the Company shall pledge
or shall cause such Subsidiary to pledge to Agent 65% of the shares of capital
stock of such New Foreign Subsidiary and all other securities, instruments and
rights from time to time received by or distributable to each Pledgor in
respect of any Collateral. Upon the occurrence of any of the foregoing, the
Company shall execute and deliver or shall cause its Subsidiary to execute and
deliver a supplement to this Agreement in the form of Exhibit B (with only such
changes thereto as are agreed to by the Agent), and in the case of the Company
pledging shares of a New Domestic Subsidiary or New Foreign Subsidiary, such
shares shall be deemed to be Pledged Shares, and in the case of a new
Subsidiary executing such supplement, such Person shall be deemed a Pledgor for
all purposes hereunder.

6.5. Successors and Assigns. This Agreement shall be binding upon each
Pledgor and its successors and assigns and shall inure to the benefit of, and
shall be enforceable by, the Agent and the Banks and their respective
successors and assigns pursuant to the Credit Agreement.

-11-

<PAGE> 12

6.6. Further Assurances. Each Pledgor, jointly and severally, agrees to do
such further acts and things and to execute and deliver such additional
agreements, powers and instruments as the Agent may reasonably require or
reasonably deem advisable to carry into effect the purposes of this Agreement
or to better assure and confirm unto the Agent its rights, powers and remedies
under this Agreement, the Credit Agreement or any other Loan Document.

6.7. Loan Document. This Agreement is a Loan Document executed and
delivered pursuant to the Credit Agreement and shall (unless otherwise
expressly indicated herein) be construed, administered and applied in
accordance with the terms and provisions thereof. Without limiting the
generality of the foregoing, the provisions of Sections 1.02 and 1.03 of the
Credit Agreement shall apply to the interpretation and administration of this
Agreement as if such provisions were incorporated herein, unto all references
to the "Agreement" in such Sections 1.02 and 1.03 being deemed to be references
to this Amended and Restated Senior Pledge Agreement.

6.8. Waivers: Writing Required. No delay or omission by the Agent or any
Bank to exercise any right under this Agreement shall impair any such
right, nor shall it be construed to be a waiver thereof. No waiver of any
single breach or default under this Agreement shall be deemed a waiver of any
other breach or default. Any amendment or waiver of any provision of this
Agreement must be in writing and signed by the Pledgors and the Agent, in
accordance with the terms of Section 11.01 of the Credit Agreement.

6.9. Remedies. All rights and remedies provided in this Agreement and any
instrument or agreement referred to herein are cumulative and are not exclusive
of any rights or remedies otherwise provided by law. Any single or par exercise
of any right or remedy shall not preclude the further exercise thereof or the
exercise of any other right or remedy.

6.10. Costs and Expenses. Each Pledgor agrees to pay or reimburse the
Agent and each Bank promptly after demand for all reasonable out-of-pocket
costs and expenses (including reasonable Attorney Costs) incurred by them in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement during the existence of an Event of
Default or after acceleration of the Loans (including all costs and expenses
incurred in connection with any "workout" or restructuring regarding amounts
due under this Agreement, and including all costs and expenses incurred in any
Insolvency Proceeding or appellate proceeding).

6.11. Severability. The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement referred to herein shall not in
any way affect or impair the legality or enforceability of the remaining
provisions of this Agreement or any instrument or agreement referred to herein.

6.12. GOVERNING LAW AND JURISDICTION.

(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED

-12-
<PAGE> 13

THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.

(b) ANY LEGAL ACTION OR PROCEEDING WILL RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS
OF THE STATE OF ILLINOIS OR OF THE UNITED STATES FOR THE NORTHERN
DISTRICT OF ILLINOIS, AND BY EXECUTION AND DELIVERY OF AGREEMENT,
EACH OF THE PLEDGORS, THE COMPANY, THE AGENT AND THE BANKS
CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE PLEDGORS,
THE COMPANY, THE AGENT, THE DESIGNATED BIDDERS AND THE BANKS
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS AGREEMENT
OR ANY DOCUMENT RELATED HERETO. THE PLEDGORS, THE COMPANY, THE
AGENT, THE DESIGNATED BIDDERS AND THE BANKS EACH WAIVE PERSONAL
SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE
MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.

6.13. WAIVER OF JURY TRIAL. THE PLEDGORS, THE COMPANY, THE BANKS AND THE
AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE
OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN
ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE
PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR
ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE.
THE PLEDGORS, THE COMPANY, THE BANKS, THE DESIGNATED BIDDERS AND THE AGENT
EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A COURT
TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE
THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION OF THIS
SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN
WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT
OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF. THIS WAIVER
SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT AND TO OTHER LOAN DOCUMENTS.

-13-
<PAGE> 14

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

6.15. Headings. Section and other headings used in this Agreement are for
convenience only and shall not affect the construction of this Agreement.

6.16. Entire Agreement. This Agreement (a) integrates all the terms and
conditions mentioned herein or incidental hereto, (b) supersedes all oral
negotiations and prior writings with respect to the subject matter hereof, and
(c) is intended by the parties as the final expression of the agreement with
respect to the terms and conditions set forth in this Agreement and as the
complete and exclusive statement of the terms agreed to by the parties.

[SIGNATURE PAGE FOLLOWS]

-14-

<PAGE> 15

IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
their duly authorized officers as of the day and year first above written.

IDEX

By: Douglas C. Lennox
----------------------------------
Title: Treasurer
-------------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Treasurer
----------------------------
Facsimile No.: (847) 498-3940

BANK OF AMERICA ILLINOIS,
as Agent

By: David A. Johanson
----------------------
David A. Johnson
Title: Vice President
-------------------

S-1

<PAGE> 16

SCHEDULE I

PLEDGED NOTES

Principal Amount of
Subsidiary Date Intercompany Note
- ---------- ------ -------------------

Band-it-IDEX, Inc. 10/24/94 $18,411,086

Vibratech, Inc. 10/24/94 $11,506,929

Lubriquip, Inc. 10/24/94 $27,599,999

Strippit, Inc. 10/24/94 $15,342,572

Viking Pump, Inc. 10/24/94 $38,356,430

Warren Rupp, Inc. 10/24/94 $30,685,144

Corken, Inc. 10/24/94 $11,000,000

Pulsafeeder, Inc. 10/24/94 $56,000,000

Hale Products, Inc. 10/24/94 $70,000,000

Micropump, Inc. 11/01/95 $22,000,000

-1-
<PAGE> 17

SCHEDULE II

PLEDGED SHARES

Capital Stock
-------------
Subsidiary Issuer Number of Shares Certificate Number
- ----------------- ---------------- ------------------
Band-It-IDEX, Inc. 100 2
(f/k/a Houdaille Band-It, Inc. and
f/k/a Band-It-Houdaille, Inc.)

Vibratech, Inc. 100 2
(f/k/a Houdaille Hydraulics, Inc. and
f/k/a Hydraulics-Houdaille, Inc.)

Lubriquip, Inc. 100 2
(f/k/a Houdaille Lubriquip, Inc. and
f/k/a Lubriquip-Houdaille, Inc.)

Strippit, Inc. 100 2
(f/k/a Houdaille Strippit-DiAcro, Inc. and
f/k/a Strippit-Houdaille, Inc.)

Viking Pump, Inc. 100 2
(f/k/a Houdaille Viking Pump, Inc. and
f/k/a Viking Pump-Houdaille, Inc.)

Warren Rupp, Inc. 100 2
(f/k/a Houdaille Warren Rupp, Inc. and
f/k/a Warren-Rupp-Houdaille, Inc.)

Corken, Inc. 100 2
(f/k/a CIC Acquisition Corp.)

Pulsafeeder, Inc. 100 2
(f/k/a PLF Acquisition Corporation)

Hale Products, Inc. 100 2
(f/k/a Hale Fire Pump Company)

Micropump, Inc. 100 2
(f/k/a MC Acquisition Corp.)

-2-

<PAGE> 18

EXHIBIT A

FORM OF INTERCOMPANY NOTE

FOR VALUE RECEIVED, the undersigned,____________________________, a
_____________________ corporation ("Borrower"), promises to pay to the order of
_________________, a _______________ corporation ("Lender"), on the demand of
the Lender (or immediately upon any acceleration described in the last
paragraph of this Intercompany Note), the amount that has been advanced and is
then outstanding hereunder, together with interest thereon as hereinafter set
forth.

This Intercompany Note is one of the Intercompany Notes referred to and
defined in that certain Amended and Restated Pledge Agreement dated as of July
17, 1996 (as amended, restated, supplemented or otherwise modified from time to
time, the "Pledge Agreement") by IDEX Corporation (together with its successors
and assignors, "IDEX Corporation"), a Delaware corporation and certain of its
subsidiaries (including Borrower), in favor of Bank of America Illinois, as
Agent for the financial institutions from time to time party to that certain
Credit Agreement referred to in the Pledge Agreement. Unless otherwise defined
herein, each capitalized term used herein shall have the meaning assigned
thereto in the Pledge Agreement or, if not defined therein, as defined in the
Credit Agreement referred to in the Pledge Agreement.

Borrower hereby expressly acknowledges and agrees that Lender may,
pursuant to the terms of the Pledge Agreement, pledge all of its rights,
title and interest hereunder to the Agent (as defined in the Pledge Agreement)
for the benefit of the Agent and the Banks identified in the Pledge Agreement.

This Intercompany Note is a note under which advances, repayments and new
advances may be made from time to time, provided that Lender shall not be
obligated to make any advance hereunder. Advances hereunder may be requested by
Borrower orally or in writing.

The principal balance of advances outstanding from time to time under this
Intercompany Note shall bear interest at a per annum rate to be agreed by
Lender and Borrower from time to time; interest shall be computed on a daily
basis using a year of 365 or 366 days, as the case may be, and assessed for the
actual number of days elapsed. Interest shall be payable in arrears with such
frequency as agreed by Borrower and Lender from time to time, but in no event
less frequently than quarterly, on the last day of each such period as so
agreed by Borrower and Lender and otherwise on demand.

- 1 -
<PAGE> 19

Any and all principal and interest not paid when due and owing under this
Intercompany Note shall bear interest at a per annum rate equal to two percent
(2.0%) plus the interest rate applicable hereunder on the date that
such principal and/or interest is first due but not paid. If this Intercompany
Note or any part of the indebtedness evidenced hereby is not paid when due,
Borrower promises to pay all reasonable costs of collection, including, without
limitation, Attorney Costs and all other reasonable expenses incurred by the
holder hereof in connection therewith, whether or not suit is filed hereon.

Both the principal of and interest on this Intercompany Note are payable
in lawful money of the United States of America to Lender, to such account as
Lender may designate from time to time, in same day funds. At the time of each
advance hereunder, and upon each repayment of amounts outstanding hereunder,
Lender shall make a notation either on the schedule attached hereto and made a
part hereof, or in Lender's own books and records, in each case specifying the
amount of such advance, the interest rate in effect from time to time hereunder
and the amount of principal and interest paid, as the case may be; provided,
that Lender's failure to make any such recordation or notation shall not affect
the obligations of Borrower hereunder. Such records shall be prima facie
evidence of the amount and timing of all advances, repayments and interest rate
determinations.

Presentment, protest and notice of nonpayment and protest are hereby
waived by Borrower.

Whenever in this Intercompany Note reference is made to Lender or
Borrower, such reference shall be deemed to include, as applicable, a reference
to their respective successors and assigns. The provisions of this Intercompany
Note shall be binding upon Borrower and its successors and assigns, and shall
inure to the benefit of the Lender and its successors and

- 2 -
<PAGE> 20

assigns. Borrower's successors and assigns shall include, without limitation, a
receiver, trustee or debtor-in-possession of or for Borrower.

[SIGNATURE PAGE FOLLOWS]

- 3 -

<PAGE> 21

IN WITNESS WHEREOF, the undersigned has caused this Intercompany Note to
be duly executed as of ______________________.

[BORROWER]

By: ____________________
Name: ___________________
Title:___________________

- 4 -

<PAGE> 22

SCHEDULE A
TO
INTERCOMPANY NOTE

Schedule of Advances and Repayments

- 5 -

<PAGE> 1
EXHIBIT 4.6(a)

SUPPLEMENT TO THE AMENDED AND RESTATED
SENIOR PLEDGE AGREEMENT

This Supplement No. 1 dated as of August 5, 1996, (this "Supplement") to
the Pledge Agreement (as defined below) is by IDEX Corporation, a Delaware
corporation (the "Pledgor"), in favor of Bank of America Illinois, as Agent (as
defined in the Pledge Agreement) under the Pledge Agreement for the benefit of
the secured parties thereunder.

RECITALS:

A. The Pledgor, the Agent and the Banks (as defined in the Pledge
Agreement) entered into that certain Third Amended and Restated Credit
Agreement dated as of July 17, 1996. The Third Amended and Restated Credit
Agreement as now in effect or hereafter extended, renewed, modified,
supplemented, amended or restated is hereinafter called the "Credit Agreement".

B. The Pledgor is a party to that certain Amended and Restated Pledge
Agreement dated as of July 17, 1996 (as amended, restated, supplemented or
otherwise modified from time to time, the "Pledge Agreement") with Bank of
America Illinois, as Agent for the financial institutions from time to time
party to that certain Credit Agreement. Unless otherwise defined herein, each
capitalized term used herein shall have the meaning assigned thereto in the
Pledge Agreement or, if not defined therein, as defined in the Credit Agreement
referred to in the Pledge Agreement.

C. Pursuant to Section 6.4 of the Pledge Agreement, this Supplement is
required to be executed and delivered to the Agent.

In consideration of the premises above and as set forth in the Pledge
Agreement, the parties hereto agree as follows:

ARTICLE I
SUPPLEMENT TO PLEDGE AGREEMENT

1.1 Supplement to Pledge Agreement. In accordance with Section 6.4 of the
Pledge Agreement, Pledgor, by its execution and delivery of this Supplement,
hereby (a) represents and warrants that the representations and warranties made
by it as a Pledgor under the Pledge Agreement are true and correct in all
material respects on and as of the date hereof and (b) agrees that the
Schedules hereto (which are designated as supplements to the corresponding
Schedules of the Pledge Agreement) are hereby incorporated in their entirety
into such corresponding Schedules of the Pledge Agreement. Each reference to
"Pledged Notes," "Pledged Shares" and "Pledged Property" in the Pledge
Agreement shall be deemed to include the Pledged Notes, Pledged Shares and
Pledged Property pledged herein.

1.2 Additional Representations, Warranties and Covenants. Pledgor
represents and warrants to the Agent and the Banks that this Supplement has
been duly authorized, executed and delivered by it and constitutes its legal,
valid and binding obligation, enforceable against it in accordance with its
terms.

<PAGE> 2

ARTICLE II
SECURITY INTERESTS

2.1 Grant of Security Interest.

(a) As security for payment of all Obligations of such Pledgor, Pledgor
hereby ratifies and confirms its pledge and grant of a security interest
pursuant to the Pledge Agreement and hereby pledges, assigns and transfers to
Agent and grants to Agent a continuing security interest in and to the shares
of capital stock and/or promissory notes identified on Schedules I and II
attached hereto together with all Dividends, Distributions, interest and other
payments and rights with respect thereto and all proceeds of any of the
foregoing (all of the items referred to in this Section 2.1 being herein called
the "Collateral"). The parties agree that such capital stock and/or promissory
notes shall be Pledged Shares or Pledged Notes pursuant to the Pledge Agreement
and shall be subject to the terms and conditions of the Pledge Agreement.

(b) All advances, charges, costs and expenses, including reasonable
attorneys' fees, incurred or paid by Agent in exercising any right, power or
remedy conferred by this Agreement, or in the enforcement hereof or thereof,
shall, to the extent lawful, become a part of the Obligations secured hereby.

(c) The Pledged Notes listed on Schedule I hereto and the certificates
representing the Pledged Shares listed on Schedule II hereto shall be delivered
to the Agent contemporaneously herewith together with appropriate undated note
powers and stock powers duly executed in blank. Neither the Agent nor any Bank
shall be obligated to preserve or protect any rights with respect to the
Pledged Notes or the Pledged Shares or to receive or give any notice with
respect thereto whether or not the Agent or any Bank (other than the Pledgor)
is deemed to have knowledge of such matters.

(d) The assignments and security interests under this Supplement granted
to the Agent shall not relieve Pledgor from the performance of any term,
covenant, condition or agreement on Pledgor's part to be performed or observed
under or in respect of any of the Collateral pledged by it hereunder or from
any liability to any Person under or in respect of any of such Collateral or
impose any obligation on the Agent to perform or observe any such term,
covenant, condition or agreement on Pledgor's part to be so performed or
observed or impose any liability on the Agent for any act or omission on the
part of Pledgor relative thereto or for any breach of any representation or
warranty on the part of Pledgor contained in this Supplement, the Pledge
Agreement or any other Loan Document, or in respect of the Collateral pledged
by it hereunder or made in connection herewith or therewith. The obligations
of Pledgor contained in this paragraph shall survive the termination of the
Pledge Agreement and the discharge of Pledgor's other obligations thereunder.

<PAGE> 3

the foregoing security interests granted pursuant hereto. Pledgor further
agrees to take all actions reasonably requested by the Agent (including,
without limitation, the filing of UCC-1 financing statements) in connection
with the granting of such security interests. Pledgor agrees to pay in full
all taxes, fees and other charges payable in connection with the actions
described in this clause (e).

2.2 Power of Attorney. Pledgor hereby constitutes and appoints the Agent
its true and lawful attorney, irrevocably, with full power after the occurrence
of and during the continuance of a Default Event (in the name of Pledgor or
otherwise), in the Agent's discretion, to take any action and to execute any
instrument which the Agent may reasonably deem necessary or advisable to
accomplish the purposes of the Pledge Agreement, which appointment as attorney
is coupled with an interest.

ARTICLE III
MISCELLANEOUS

3.1 Miscellaneous Provisions. Each of the provisions set forth in
Sections 6.1 through 6.17 (inclusive) of the Pledge Agreement is hereby
incorporated by reference mutatis mutandis with the same effect as if such
provisions had been set forth herein with each reference therein to "this
Agreement" deemed to be a reference to "this Supplement" and each reference to
a "Pledgor" deemed to be a reference to "Pledgor".

[SIGNATURE PAGE FOLLOWS]

<PAGE> 4

IN WITNESS WHEREOF, the parties hereto have caused this Supplement No. 1
to the Pledge Agreement to be duly and properly executed and delivered as of
the date first written above.

IDEX Corporation

By: /s/ WAYNE P. SAYATOVIC
--------------------------
Name: Wayne P. Sayatovic
Title: Senior Vice President - Finance,
Chief Financial Officer and Secretary

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Douglas C. Lennox
Facsimile No.: 312/498-3940

Accepted:

BANK OF AMERICA ILLINOIS,
as Agent

By:
----------------------------------
Title:
-------------------------------

<PAGE> 5

SCHEDULE I (to Supplement No. 1)

PLEDGED NOTES

Principal Amount of
Subsidiary Date Intercompany Note
---------------------- ------- -------------------

Fluid Management, Inc. 7/29/96 $100,000,000

<PAGE> 6

SCHEDULE II (to Supplement No. 1)

PLEDGED SHARES

Capital Stock
------------------------------------
Subsidiary Issuer Number of Shares Certificate Number
---------------------------- ---------------- ------------------

FMI Management Company 1000 1
(f/k/a The Saranow Company)

Fluid Management, Inc. 100 1
(f/k/a FM Acquistion Corp)

<PAGE> 1
Exhibit 4.7

AMENDED AND RESTATED SUBSIDIARY GUARANTY AGREEMENT

RECITALS:

A. IDEX Corporation, a Delaware corporation (the "Company"), the
Agent and the Banks entered into that certain Third Amended and Restated
Credit Agreement dated as of July 17, 1996. The Third Amended and Restated
Credit Agreement as now in effect or hereafter extended, renewed, modified,
supplemented, amended or restated is hereinafter called the "Credit Agreement".

C. Each Guarantor has previously entered into guaranties (See
Recital D below) pursuant to that certain Credit Agreement, among the
Company, Agent and various banking institutions, dated January 22, 1988
(herein, as amended by the First Amendment dated as of May 22, 1989, a Letter
Agreement dated as of May 7, 1991, the Amended and Restated Credit Agreement
dated as of May 4, 1992, the Second Amended and Restated Credit Agreement
dated as of January 29, 1993, which in turn was amended by the First Amendment
dated as of May 23, 1994, the Second Amendment dated as of October 24, 1994,
the Third Amendment dated as of February 28, 1995, the Fourth Amendment dated
November 1, 1995 and the Fifth Amendment dated December 22, 1995), and such
guaranties are hereby deemed to be amended and restated by this Guaranty.

D. Each Guarantor has previously entered into the following
respective guaranties: Guaranty Agreement, dated January 22, 1988, entered
into by Lubriquip, Inc. (successor to Lubriquip-Houdaille, Inc.), Warren Rupp,
Inc. (successor to Warren Rupp-Houdaille, Inc.), Viking Pump, Inc. (successor
to Viking Pump-Houdaille, Inc.), Vibratech, Inc. (successor to
Hydraulics-Houdaille, Inc.), Band-It-IDEX, Inc. (successor to
Band-It-Houdaille, Inc.), Strippit, Inc. (successor to Strippit-Houdaille,
Inc.); Guaranty Agreement, dated May 7, 1991, entered into by Corken, Inc.
(successor to CIC Acquisition Corp.); Guaranty Agreement, dated May 4, 1992,
entered into by Pulsafeeder, Inc. (successor to PLF Acquisition Corporation and
MCL Acquisition Corporation); Guaranty Agreement, dated October 24, 1994,
entered into by Hale Products, Inc.; Guaranty Agreement, dated November 1,
1995, entered into by Micropump, Inc.; and the Guaranty Agreement, dated
December 22, 1995, entered into by Dunja Verwaltungsgesellschaft mbH. All of
the foregoing guaranty agreements collectively referred to as the "Original
Guaranty Agreements".

-1-
<PAGE> 2

E. Each Guarantor, as a wholly-owned Subsidiary of the Company,
will derive continuing, substantial and direct benefits (which benefits are
hereby acknowledged by the Guarantors) from the Loans and the Letters of
Credit and other benefits to be provided to the Company under the Credit
Agreement.

F. In order to induce the Banks to continue to make such Loans
available to the Company and to induce the Issuing Bank to issue such Letters
of Credit for the account of the Company, and for other valuable
consideration, the Guarantors hereby agree that the Original Guaranty
Agreements are hereby amended and restated in their entirety as follows:

2. Guaranty.

2.1 Guaranty. Each Guarantor hereby irrevocably,
absolutely and unconditionally jointly and severally guarantees the full and
punctual payment or performance when due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise, of all
of the Obligations, including (a) Obligations in respect of amounts that would
become due but for the operation of the automatic stay under Section 362(a) of
the Bankruptcy Code or the operation of Sections 502(b) and 506(b) of the
Bankruptcy Code and (b) Obligations to deliver and pledge cash collateral upon
certain events. This Guaranty constitutes a guarantee of payment and
performance when due and not of collection, and each Guarantor specifically
agrees that it shall not be necessary or required that the Agent or any Bank
exercise any right, assert any claim or demand or enforce any remedy whatsoever
against the Company (or any other Person) before or as a condition to the
obligations of such Guarantor hereunder. The Agent or any Bank may permit the
indebtedness of the Company to the Agent or any Bank to include indebtedness
other than the Obligations and may apply any amounts received from any source,
other than from the Guarantors, to that portion of the Company's indebtedness
to the Agent or any Bank which is not a part of the Obligations.

2.2 Obligations Independent. The obligations hereunder are
independent of the obligations of the Company, and a separate action or actions
may be brought and prosecuted against the Guarantors whether action is brought
against the Company or whether the Company be joined in any such action or
actions.

2.3 Authorization of Renewals, Etc. Each Guarantor
authorizes the Agent and each Bank without notice or demand and without
affecting its liability hereunder, from time to time:

(a) to renew, compromise, extend, accelerate or
otherwise change the time for payment, or otherwise change the terms,
of the Obligations, including any increase or decrease of the rate of
interest thereon, or otherwise change the terms of the Credit Agreement
or any other Loan Document;

-2-

<PAGE> 3
(b) to receive and hold security for the payment
of this Guaranty or the Obligations and exchange, enforce, waive,
release, fail to perfect, sell, or otherwise dispose of any such
security;

(c) to apply such security and direct the order or
manner of sale thereof as the Agent, or any Bank, as the case may be,
in its or their discretion may determine; and

(d) to release or substitute any one or more of any
endorsers or guarantors of the Obligations.

2.4 Waiver of Certain Rights. Each Guarantor waives any
right to require the Agent or any Bank:

(a) to proceed against the Company or any other
Person;

(b) to proceed against or exhaust any security for
the Obligations or any other indebtedness of the Company to the Agent
or any Bank; or

2.5 Waiver of Certain Defenses. Each Guarantor waives any
defense arising by reason of any disability or other defense of the Company, or
the cessation from any cause whatsoever of the liability of the Company,
whether consensual or arising by operation of law or any bankruptcy,
insolvency or debtor relief proceeding, or from any other cause, or any claim
that such Guarantor's obligations exceed or are more burdensome than those of
the Company.

2.6 Waiver of Presentments, Etc. Each Guarantor waives all
presentments, demands for performance, notices of nonperformance, protests,
notices of protest, notices of dishonor and notices of acceptance of this
Guaranty and of the existence, creation or incurring of new or additional
Obligations or any other indebtedness of Company to the Agent or any Bank.

2.7 Information Relating to Company. Each Guarantor
acknowledges and agrees that it shall have the sole responsibility for
obtaining from the Company such information concerning the Company's
financial condition or business operations as such Guarantor may require and
that neither the Agent nor any Bank has any duty at any time to disclose to any
Guarantor any information relating to the business operations or financial
condition of the Company.

2.8 Right of Set-off. In addition to any rights and
remedies of the Banks provided by law, if any Guarantor has failed to make any
payment due hereunder upon demand, each Bank

-3-
<PAGE> 4
is authorized at any time and from time to time, without prior notice to such
Guarantor, any such notice being waived by such Guarantor to the fullest extent
permitted by law, to set-off and apply any and all Guarantor deposits (general
or special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Bank to or for the credit or the account
of such Guarantor against any and all obligations of such Guarantor now or
hereafter existing under this Guaranty or any other Loan Document, irrespective
of whether or not the Agent or such Bank shall have made demand under this
Guaranty or any other Loan Document and although such obligations may be
contingent or unmatured. Each Bank agrees promptly to notify such Guarantor
and the Agent after any such set-off and application made by such Bank;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Bank under this
Section 2.8 are in addition to the other rights and remedies (including,
without limitation, other rights of set-off) which such Bank may have.

2.9 Reinstatement of Guaranty. If any payment or transfer
of any interest in property by the Company to the Agent or any Bank in
fulfillment of any Obligation is rescinded or must at any time (including after
the return or cancellation (other than by written release herefrom) of
this Guaranty) be returned, in whole or in part, by the Agent or any Bank to
the Company or any other Person, upon the insolvency, bankruptcy or
reorganization of the Company or otherwise, this Guaranty shall be reinstated
with respect to any such payment or transfer, regardless of any such prior
return or cancellation.

2.10 Powers. It is not necessary for the Agent or any Bank
to inquire into the powers of the Company or of the officers, directors,
partners or agents acting or purporting to act on its behalf, and any
Obligations made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.

2.11 Taxes.

(b) If any Guarantor shall be required by law to
deduct or withhold any Taxes, Other Taxes or Further Taxes from or in
respect of any sum payable hereunder to any Bank or the Agent, then:

(i) the sum payable shall be increased as
necessary so that, after making all required deductions and
withholdings (including deductions and withholdings applicable to
additional sums payable under this Section 2.11), such Bank or the
Agent, as the case may be, receives and retains an amount equal to
the sum it would have received and retained had no such deductions
or withholdings been made;

(ii) such Guarantor shall make such
deductions and withholdings;

-4-

<PAGE> 5

(iii) such Guarantor shall pay the full amount
deducted or withheld to the relevant taxing authority or other
authority in accordance with applicable law; and

(iv) such Guarantor shall also pay to each Bank or
the Agent for the account of such Bank, at the time interest is
paid, Further Taxes in the amount that the respective Bank specifies
as necessary to preserve the after-tax yield the Bank would have
received if such Taxes, Other Taxes or Further Taxes had not been
imposed.

(c) Each Guarantor agrees to indemnify and hold harmless
each Bank and the Agent for the full amount of (i) Taxes, (ii) Other
Taxes and (iii) Further Taxes in the amount that the respective Bank
specifies as necessary to preserve the after-tax yield the Bank would
have received if such Taxes, Other Taxes or Further Taxes had not been
imposed, and any liability (including penalties, interest, additions to
tax and expenses) arising therefrom or with respect thereto, whether or
not such Taxes, Other Taxes or Further Taxes were correctly or legally
asserted. Payment under this indemnification shall be made within 30
days after the date the Bank or the Agent makes written demand therefor.

(d) Within 30 days after the date of any payment by any
Guarantor of Taxes, Other Taxes or Further Taxes, such Guarantor shall
furnish to each Bank or the Agent the original or a certified copy of a
receipt evidencing payment thereof, or other evidence of payment
satisfactory to such Bank or the Agent.

(e) If any Guarantor is required to pay any amount to any
Bank or the Agent pursuant to subsection (b) or (c) of this Section
2.11, then such Bank shall use reasonable efforts (consistent with legal
and regulatory restrictions) to change the jurisdiction of its Lending
Office so as to eliminate any such additional payment by such Guarantor
which may thereafter accrue, if such change in the sole judgment of such
Bank is not otherwise disadvantageous to such Bank.

(f) Notwithstanding anything to the contrary contained in
this Guaranty, in no event shall any Guarantor be either (i) obligated
to pay any amount to any Bank or the Agent pursuant to subsection (b) or
(c) of this Section 2.11 or (ii) prohibited from deducting or withholding
for any applicable Taxes pursuant to subsection (a) of this Section 2.11,
if the Bank or Agent fails to deliver forms to such Guarantor in
accordance with Section 10.10 of the Credit Agreement on a timely basis,
unless such failure would not have occurred but for a change in law or
regulation or in the interpretation thereof by any governmental or
regulatory agency or body charged with the administration or
interpretation thereof, or the introduction of any law or regulation,
that occurs on or after the date hereof.

-5-

<PAGE> 6

by the jurisdiction (or any political subdivision thereof) under the laws
of which such Bank or the Agent, as the case may be, is organized or
maintains a lending office; (ii) "Other Taxes" means any present or
future stamp, court or documentary taxes or any other excise or property
taxes, charges or similar levies which arise from any payment made
hereunder or from the execution, delivery, performance, execution or
registration of, or otherwise with respect to, this Guaranty; and (iii)
"Further Taxes" means any and all present or future taxes, levies,
assessments, imposts, duties, deductions, fees, withholdings or similar
charges (including, without limitation, net income taxes and franchise
taxes), and all liabilities with respect thereto, imposed by any
jurisdiction on account of amounts payable or paid pursuant to this
Guaranty.

3. Representations and Warranties. Each Guarantor represents and
warrants to the Agent and each Bank as follows:

3.1 Corporate Existence and Power. Such Guarantor (a) is a
corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation; (b) has the power and authority
and all governmental licenses, authorizations, consents and approvals to own
its assets, carry on its business and to execute, deliver and perform its
obligations under this Guaranty and any other Loan Document to which it is a
party; (c) is duly qualified as a foreign corporation, and licensed and in good
standing, under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification or license except where the failure to be so qualified could not
reasonably be expected to have a Material Adverse Effect; and (d) is in
compliance with all Requirements of Law except where the failure to do so or to
so comply could not reasonably be expected to have a Material Adverse Effect.

3.2 Corporate Authorization; No Contravention. The
execution, delivery and performance by such Guarantor of this Guaranty and any
other Loan Document to which it is party, have been duly authorized by all
necessary corporate action, and do not and will not (a) contravene the terms of
any of such Guarantor's Organization Documents; (b) conflict with or result in
any breach or contravention of, or the creation of any lien under, any document
evidencing any Contractual Obligation to which such Guarantor is a party or any
order, injunction, writ or decree of any Governmental Authority to which such
Guarantor or its property is subject; or (c) violate any Requirement of Law
applicable to such Guarantor.

3.3 Governmental Authorization. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing
with, any Governmental Authority is necessary or required in connection with
the execution, delivery or performance by, or enforcement against, such
Guarantor of this Guaranty or any other Loan Document to which it is a party.

-6-

<PAGE> 7

3.5 Regulated Entities. None of such Guarantor, any
Person controlling such Guarantor or any Subsidiary of such Guarantor is (a) an
"Investment Company" within the meaning of the Investment Company Act of
1940; or (b) subject to regulation under the Public Utility Holding Company Act
of 1935, the Federal Power Act, the Interstate Commerce Act, any state public
utilities code, or any other Federal or state statute or regulation limiting
its ability to incur or guarantee Indebtedness.

4. Miscellaneous.

4.1 Application of Payments on Guaranty. All payments
required to be made by any Guarantor hereunder shall, unless otherwise
expressly provided herein, be made to the Agent for the account of the Banks at
the Agent's Payment Office and, with respect to principal of, interest on,
and any other amounts relating to, any Offshore Currency Loan, shall be made in
the Offshore Currency in which such Loan is denominated or payable and, with
respect to all other amounts payable hereunder, shall be made in Dollars. The
Agent will promptly distribute to each Bank its Pro Rata Share (or other
applicable share as expressly provided in the Credit Agreement) of such
principal, interest, fees or other amounts in like funds as received. Payments
received from any Guarantor shall, unless otherwise expressly provided herein,
be applied to costs, fees or other expenses due under the Loan Documents, any
interest (including interest due under Section 2.12 of the Credit Agreement),
any principal due under the Loan Documents and any other Obligations, in such
order as the Agent, with the consent of or at the request of the Banks, shall
determine.

4.2 Assignments, Participations, Confidentiality. Any Bank
may from time to time, without notice to the Guarantors and without affecting
the Guarantors' obligations hereunder, transfer its interest in the Obligations
to Participants and Assignees as provided in the Credit Agreement. Each
Guarantor agrees that each such transfer will give rise to a direct obligation
of such Guarantor to each Assignee to which the Company, if required, shall
have consented to and that each Assignee shall have the same rights and
benefits under this Guaranty as it would have if it were a Bank party to the
Credit Agreement and this Guaranty. The Guarantors, the Agent and each Bank
agree that the provisions of Section 11.10 of the Credit Agreement shall apply
to all information identified as "confidential" or "secret" by any Guarantor
and provided to the Agent or such Bank by any Guarantor or any Subsidiary of a
Guarantor under this Guaranty or any other Loan Document to which such
Guarantor is a party.

-7-

<PAGE> 8

4.3 Successors and Assigns. This Guaranty shall be binding
upon each Guarantor and its successors and assigns and shall inure to the
benefit of, and shall be enforceable by, the Agent and the Banks and their
respective successors and assigns pursuant to the Credit Agreement.

4.5 Loan Document. This Guaranty is a Loan Document
executed and delivered pursuant to the Credit Agreement and shall (unless
otherwise expressly indicated herein) be construed, administered and
applied in accordance with the terms and provisions thereof. Without limiting
the generality of the foregoing, the provisions of Sections 1.02 and 1.03 of
the Credit Agreement shall apply to the interpretation and administration of
this Guaranty as if such provisions were incorporated herein, with all
references to the "Agreement" in such Sections 1.02 and 1.03 being deemed to be
references to this Guaranty.

4.6 Waivers; Writing Required. No delay or omission by
the Agent or any Bank to exercise any right under this Guaranty shall impair
any such right, nor shall it be construed to be a waiver thereof. No
waiver of any single breach or default under this Guaranty shall be deemed a
waiver of any other breach or default. Any amendment or waiver of any
provision of this Guaranty must be in writing and signed by the Guarantors and
the Agent, with the written consent of the Banks, in accordance with the terms
of Section 11.01 of the Credit Agreement, provided that an additional
Subsidiary of the Company may become a Guarantor under this Guaranty pursuant
to the requirements of Section 7.13 of the Credit Agreement by executing and
delivering to the Agent a supplement to this Guaranty in the form of Exhibit A
attached hereto (with only such changes thereto as are agreed to by the Agent),
whereupon, without further action, approval or consent by any other Person,
such Subsidiary shall be deemed to be a Guarantor for all purposes under this
Guaranty.

4.7 Remedies. All rights and remedies provided in this
Guaranty and any instrument or agreement referred to herein are cumulative and
are not exclusive of any rights or remedies otherwise provided by law.
Any single or partial exercise of any right or remedy shall not preclude the
further exercise thereof or the exercise of any other right or remedy.

-8-

<PAGE> 9

4.10 GOVERNING LAW AND JURISDICTION.

(a) THIS GUARANTY SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF ILLINOIS; PROVIDED
THAT THE AGENT AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.

(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS GUARANTY OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF
THE STATE OF ILLINOIS OR OF THE UNITED STATES FOR THE NORTHERN
DISTRICT OF ILLINOIS, AND BY EXECUTION AND DELIVERY OF THIS GUARANTY,
EACH OF THE GUARANTORS, THE COMPANY, THE AGENT AND THE BANKS CONSENTS,
FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE
JURISDICTION OF THOSE COURTS. EACH OF THE GUARANTORS, THE COMPANY, THE
AGENT, THE DESIGNATED BIDDERS AND THE BANKS IRREVOCABLY WAIVES ANY
OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO
THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE GUARANTORS, THE
COMPANY, THE AGENT, THE DESIGNATED BIDDERS AND THE BANKS EACH WAIVE
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE
MADE BY ANY OTHER MEANS PERMITTED BY ILLINOIS LAW.

4.11 WAIVER OF JURY TRIAL. THE GUARANTORS, THE COMPANY, THE
BANKS AND THE AGENT EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS
GUARANTY, THE OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT
BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR ANY AGENT-RELATED PERSON,
PARTICIPANT OR ASSIGNEE, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS,
OR OTHERWISE. THE GUARANTORS, THE COMPANY, THE BANKS, THE DESIGNATED BIDDERS
AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED
BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE PARTIES
FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY
OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER

-9-

<PAGE> 10

PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR
ENFORCEABILITY OF THIS GUARANTY OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION
HEREOF OR THEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS GUARANTY AND THE OTHER LOAN
DOCUMENTS.

4.12 Nature of Obligations. All obligations and liabilities
of the Guarantors hereunder shall be joint and several.

4.13 Certain Limitations. Anything contained in this
Guaranty to the contrary notwithstanding, the obligations of each Guarantor
hereunder shall be limited to a maximum aggregate amount equal to the
greatest amount that would not render such Guarantor's obligations hereunder
subject to avoidance as a fraudulent transfer or conveyance under Section 548
of Title 11 of the Bankruptcy Code or any provisions of applicable state law.

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

4.15 Headings. Section and other headings used in this
Guaranty are for convenience only and shall not affect the construction of this
Guaranty.

4.16 Entire Agreement. This Guaranty (a) integrates all
the terms and conditions mentioned herein or incidental hereto, (b) supersedes
all oral negotiations and prior writings with respect to the subject
matter hereof, and (c) is intended by the parties as the final expression of
the agreement with respect to the terms and conditions set forth in this
Guaranty and as the complete and exclusive statement of the terms agreed to by
the parties.

[SIGNATURE PAGES FOLLOW]

-10-

<PAGE> 11

IN WITNESS WHEREOF, the Guarantors have executed this Guaranty by their
duly authorized officers as of the day and year first above written.

BAND-IT-IDEX, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

CORKEN, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

LUBRIQUIP, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

S-1

<PAGE> 12
PULSAFEEDER, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------
Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

STRIPPIT, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

VIBRATECH, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

S-2

<PAGE> 13

VIKING PUMP, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

WARREN RUPP, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

HALE PRODUCTS, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

S-3

<PAGE> 14

MICROPUMP, INC.

By: /s/ [Douglas C. Lennox]
---------------------------------
Title: Vice President
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Vice President
-------------------------
Facsimile No.: (847) 498-3940

DUNJA VERWALTUGSGESELLSCHAFT mbH

By: /s/ [Robert Grindel]
---------------------------------
Title: Manging Director
-----------------------------

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Managing Director
Facsimile No.: (947) 498-3940

BANK OF AMERICA ILLINOIS,
as Agent

By: /s/ [David A. Johanson]
-------------------------------
Title: Vice President
----------------------------

S-4

<PAGE> 1
EXHIBIT 4.7(a)

SUPPLEMENT TO THE AMENDED AND RESTATED
SUBSIDIARY GUARANTY AGREEMENT

This Supplement No. 1 dated as of August 5, 1996, (this "Supplement") to
the Amended and Restated Subsidiary Guaranty Agreement (as defined below) is
made by FMI Management Company, an Illinois Corporation, ("New Guarantor"), in
favor of the Agent and Banks (as defined below).

RECITALS:

A. IDEX Corporation, a Delaware corporation (the "Company"), is a party to
that certain Third Amended and Restated Credit Agreement dated as of July 17,
1996 (as amended, restated, supplemented or otherwise modified from time to
time, the "Credit Agreement"), with Bank of America Illinois, as Agent for
itself (in such capacity the "Agent") and the financial institutions from time
to time party to the Credit Agreement (the "Banks").

B. New Guarantor is a Subsidiary of the Company (as defined in the Credit
Agreement).

C. As a condition precedent to their entering into the Credit Agreement,
the Agent and the Banks thereunder required the Company to cause certain of its
Subsidiaries to execute and deliver that certain Amended and Restated
Subsidiary Guaranty Agreement dated as of July 17, 1996 (as heretofore or
hereafter amended, restated, supplemented or otherwise modified from time to
time, the "Subsidiary Guaranty Agreement").

D. The proceeds of Credit Extensions (as defined in the Credit Agreement)
heretofore have been and hereafter will be used in part to enable the Company
to make valuable transfers to each of the Guarantors (including New Guarantor)
in connection with the operation of its businesses.

E. The Company and New Guarantor are engaged in related businesses, and
New Guarantor will derive substantial direct and indirect benefit from the
making of the Credit Extensions.

F. Pursuant to Section 7.13 of the Credit Agreement, the Company and the
Company's Subsidiaries are required to cause each Domestic Subsidiary which is
also a Material Subsidiary that was not in existence (or not such a Subsidiary)
on the date of the Credit Agreement to become a Guarantor under the Subsidiary
Guaranty Agreement upon becoming a Subsidiary.

<PAGE> 2

H. In consideration of the premises and to induce the Banks to continue to
make Credit Extensions, New Guarantor hereby agrees as follows:

1. Definitions. Each capitalized term used herein and not otherwise
defined herein shall have the meaning assigned to such term in the Subsidiary
Guaranty Agreement or, if not defined herein or in the Subsidiary Guaranty
Agreement, in the Credit Agreement.

2. Guaranty of Obligations. In accordance with Section 4.6 of the
Subsidiary Guaranty Agreement, New Guarantor, by its execution and delivery of
this Supplement, hereby becomes a Guarantor under the Subsidiary Guaranty
Agreement for all purposes thereunder with the same force and effect as if
originally named therein as a Guarantor, without further action, approval or
consent by any other Person, and New Guarantor hereby (a) agrees to all the
terms and provisions of the Subsidiary Guaranty Agreement applicable to it as a
Guarantor thereunder and (b) represents and warrants that the representations
and warranties deemed to be made by it as a Guarantor thereunder are true and
correct in all material respects on and as of the date hereof. Each reference
to a "Guarantor" in the Subsidiary Guaranty Agreement shall be deemed for all
purposes to include New Guarantor. All of the terms of the Subsidiary Guaranty
Agreement are hereby incorporated in their entirety.

3. Representations and Warranties. New Guarantor represents and
warrants to the Beneficiaries that this Supplement has been duly authorized,
executed and delivered by it and constitutes its legal valid and binding
obligation, enforceable against it in accordance with its terms.

4. Effect of Supplement. Upon the effectiveness hereof, each
reference in the Subsidiary Guaranty Agreement to "this Guaranty," "hereunder,"
"hereof," "herein," or words of like import referring to the Subsidiary Guaranty
Agreement and each reference in the other Loan Documents to the "Subsidiary
Guaranty Agreement," "thereunder," "thereof," or words of like import referring
to the Subsidiary Guaranty Agreement shall mean and be a reference to the
Subsidiary Guaranty Agreement as amended by this Supplement. The Subsidiary
Guaranty Agreement shall be deemed to be amended wherever and as necessary to
reflect the foregoing amendments.

5. Miscellaneous Provisions. Each of the provisions set forth in
Sections 4.6 through 4.16 (inclusive) of the Subsidiary Guaranty Agreement is
hereby incorporated by reference mutatis mutandis with the same effect as if
such provisions had been set forth herein with each reference therein to "this
Guaranty" deemed to be a reference to "this Supplement" and each reference to a
"Guarantor" deemed to be a reference to "New Guarantor".

[SIGNATURE PAGE FOLLOWS]

<PAGE> 3

IN WITNESS WHEREOF, the New Guarantor has caused this Supplement No. 1 to
the Subsidiary Guaranty Agreement to be duly executed and delivered by its
properly and duly authorized officer as of the date first written above.

FMI MANAGEMENT COMPANY

By: /s/ WAYNE P. SAYATOVIC
---------------------------
Name: Wayne P. Sayatovic
Title: Vice President, Secretary and
Chief Financial Officer

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Douglas C. Lennox
Facsimile No.: 312/498-3940

Accepted:

BANK OF AMERICA ILLINOIS,
as Agent

By:
----------------------------------
Title:
-------------------------------

<PAGE> 1
EXHIBIT 4.7(b)

SUPPLEMENT TO THE AMENDED AND RESTATED
SUBSIDIARY GUARANTY AGREEMENT

This Supplement No. 2 dated as of August 5, 1996, (this "Supplement") to
the Amended and Restated Subsidiary Guaranty Agreement (as defined below) is
made by Fluid Management, Inc., a Delaware corporation ("New Guarantor"), in
favor of the Agent and Banks (as defined below).

RECITALS:

B. New Guarantor is a Subsidiary of the Company (as defined in the Credit
Agreement).

C. As a condition precedent to their entering into the Credit Agreement,
the Agent and the Banks thereunder required the Company to cause certain of its
Subsidiaries to execute and deliver that certain Amended and Restated
Subsidiary Guaranty Agreement dated as of July 17, 1996 (as heretofore or
hereafter amended, restated, supplemented or otherwise modified from time to
time, the "Subsidiary Guaranty Agreement").

D. The proceeds of Credit Extensions (as defined in the Credit Agreement)
heretofore have been and hereafter will be used in part to enable the Company
to make valuable transfers to each of the Guarantors (including New Guarantor)
in connection with the operation of its businesses.

E. The Company and New Guarantor are engaged in related businesses, and
New Guarantor will derive substantial direct and indirect benefit from the
making of the Credit Extensions.

F. Pursuant to Section 7.13 of the Credit Agreement, the Company and the
Company's Subsidiaries are required to cause each Domestic Subsidiary which is
also a Material Subsidiary that was not in existence (or not such a Subsidiary)
on the date of the Credit Agreement to become a Guarantor under the Subsidiary
Guaranty Agreement upon becoming a Subsidiary.

<PAGE> 2

H. In consideration of the premises and to induce the Banks to continue to
make Credit Extensions, New Guarantor hereby agrees as follows:

1. Definitions. Each capitalized term used herein and not otherwise
defined herein shall have the meaning assigned to such term in the Subsidiary
Guaranty Agreement or, if not defined herein or in the Subsidiary Guaranty
Agreement, in the Credit Agreement.

2. Guaranty of Obligations. In accordance with Section 4.6 of the
Subsidiary Guaranty Agreement, New Guarantor, by its execution and delivery of
this Supplement, hereby becomes a Guarantor under the Subsidiary Guaranty
Agreement for all purposes thereunder with the same force and effect as if
originally named therein as a Guarantor, without further action, approval or
consent by any other Person, and New Guarantor hereby (a) agrees to all the
terms and provisions of the Subsidiary Guaranty Agreement applicable to it as a
Guarantor thereunder and (b) represents and warrants that the representations
and warranties deemed to be made by it as a Guarantor thereunder are true and
correct in all material respects on and as of the date hereof. Each reference
to a "Guarantor" in the Subsidiary Guaranty Agreement shall be deemed for all
purposes to include New Guarantor. All of the terms of the Subsidiary Guaranty
Agreement are hereby incorporated in their entirety.

3. Representations and Warranties. New Guarantor represents and
warrants to the Beneficiaries that this Supplement has been duly authorized,
executed and delivered by it and constitutes its legal valid and binding
obligation, enforceable against it in accordance with its terms.

4. Effect of Supplement. Upon the effectiveness hereof, each reference
in the Subsidiary Guaranty Agreement to "this Guaranty," "hereunder," "hereof,"
"herein," or words of like import referring to the Subsidiary Guaranty
Agreement and each reference in the other Loan Documents to the "Subsidiary
Guaranty Agreement," "thereunder," "thereof," or words of like import referring
to the Subsidiary Guaranty Agreement shall mean and be a reference to the
Subsidiary Guaranty Agreement as amended by this Supplement. The Subsidiary
Guaranty Agreement shall be deemed to be amended wherever and as necessary to
reflect the foregoing amendments.

5. Miscellaneous Provisions. Each of the provisions set forth in
Sections 4.6 through 4.16 (inclusive) of the Subsidiary Guaranty Agreement is
hereby incorporated by reference mutatis mutandis with the same effect as if
such provisions had been set forth herein with each reference therein to "this
Guaranty" deemed to be a reference to "this Supplement" and each reference to a
"Guarantor" deemed to be a reference to "New Guarantor".

[SIGNATURE PAGE FOLLOWS]

<PAGE> 3

IN WITNESS WHEREOF, the New Guarantor has caused this Supplement No. 2 to
the Subsidiary Guaranty Agreement to be duly executed and delivered by its
properly and duly authorized officer as of the date first written above.

FLUID MANAGEMENT, INC.

By: /s/ WAYNE P. SAYATOVIC
----------------------------------
Name: Wayne P. Sayatovic
Title: Vice President, Secretary and
Chief Financial Officer

Address: 630 Dundee Road, Suite 400
Northbrook, Illinois 60065

Attention: Douglas C. Lennox
Facsimile No.: 312/498-3940

Accepted:

BANK OF AMERICA ILLINOIS,
as Agent

By:
-------------------------------
Title:
----------------------------

<PAGE> 1
EXHIBIT 4.8

REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT, dated July 29, 1996, is between IDEX
CORPORATION, a Delaware corporation with its principal place of business at 630
Dundee Road, Suite 400, Northbrook, Illinois 60062 ("IDEX") and MITCHELL H.
SARANOW, an individual residing at 860 Auburn Road, Winnetka, Illinois 60093
(the "Holder").

RECITALS:

A. IDEX, FMI Management Company, an Illinois corporation and wholly-owned
subsidiary of IDEX, the Holder and The Saranow Company entered into an
Agreement and Plan of Merger dated July 26, 1996 (the "Merger Agreement"),
pursuant to which FMI Management Company has merged with and into The Saranow
Company and IDEX has delivered to the Holder 75,700 shares of Common Stock of
IDEX (the "IDEX Shares").

B. It is a covenant of the Merger Agreement that the IDEX Shares delivered
to the Holder be registered for sale by IDEX under the Securities Act of 1933
(the "Act").

NOW, THEREFORE, in consideration of the mutual covenants and promises
contained in this Agreement and in the Merger Agreement, and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, IDEX and the Holder hereby agree as follows:

1. Transfer Restrictions. The Holder acknowledges that the IDEX Shares
have not been registered under the Act or any applicable state securities laws
and the Holder agrees not to sell, pledge, hypothecate, transfer or otherwise
dispose of (collectively "Transfer") any of the IDEX Shares unless such shares
are first registered under the Act or such Transfer is exempt from registration
and IDEX is furnished evidence reasonably satisfactory to it of such exemption.

2. Mandatory Registration. Within ninety (90) days following the date of
this Agreement, IDEX shall use its best efforts to file with the Securities and
Exchange Commission (the "Commission") a registration statement (the
"Registration Statement") under the Act on an appropriate form to register all
of the IDEX Shares for sale under the Act. Except as otherwise provided in
this Agreement, IDEX shall use its best efforts to have the Registration
Statement declared effective by the SEC as soon as practicable after it is
filed; provided, however, that the effective date may be delayed with the
consent of the Holder, which consent may not be unreasonably withheld. IDEX
shall maintain the effectiveness of the Registration Statement until first
to occur of (a) the sale by the Holder of

<PAGE> 2

-2-

all IDEX Shares, (b) the second anniversary of this Agreement or (c) the
expiration of such lesser holding period provided in Rule 144, if such rule is
amended, at which time IDEX shall have the right to de-register the IDEX
Shares. Upon notification to the Holder that the Registration Statement is not
effective or otherwise may not be used for resale by the Holder (a "Notice of
Ineffectiveness"), the Holder shall be prohibited from selling the IDEX Shares
pursuant to the Registration Statement until IDEX has provided notification to
the Holder that the Registration Statement is again available for use by the
Holder, which notification shall be provided as soon as the Registration
Statement is again available for use. IDEX shall use all reasonable efforts to
maintain the effectiveness of the Registration Statement and to minimize any
period during which the Holder may not use the Registration Statement.

3. Cooperation with IDEX. The Holder shall cooperate with IDEX in all
reasonable respects in connection with this Agreement, including timely
supplying all information reasonably requested by IDEX and executing and
returning all documents reasonably requested by IDEX in connection with the
registration and sale of the IDEX Shares.

4. Registration Procedures. In connection with the registration of the
IDEX Shares under the Act, IDEX shall (except as otherwise provided in this
Agreement), as expeditiously as possible:

(a) prepare and file with the Commission such amendments and
supplements to the Registration Statement and the prospectus used in
connection therewith as may be necessary to keep the Registration Statement
effective and to comply with the provisions of the Act with respect to the sale
or other disposition of all securities covered by the Registration Statement;

(b) furnish to the Holder such copies of a prospectus, including a
preliminary prospectus or any amendment or supplement to any prospectus, in
conformity with the requirements of the Act, and such other documents, as the
Holder may reasonably request in order to facilitate the public sale or other
disposition of the IDEX Shares;

(c) use its best efforts to register and qualify the securities
covered by the Registration Statement under such other securities or blue
sky laws of such jurisdictions as the Holder shall reasonably request, and do
any and all other acts and things which may be necessary or advisable to enable
the Holder to consummate the public sale or other disposition of the IDEX
Shares in such jurisdictions, except that IDEX shall not for any such purpose
be required to qualify to do business as a foreign corporation in any
jurisdiction wherein it is not so qualified or to file therein any general
consent to service of process;

<PAGE> 3

-3-

(d) use its best efforts to list such securities on any securities
exchange on which any securities of IDEX are then listed; and

(e) notify the Holder at any time when a prospectus relating thereto
covered by such Registration Statement is required to be delivered under the
Act, of the happening of any event of which it has knowledge as a result of
which the prospectus included in such Registration Statement, as then in
effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing.

5. Expenses. All expenses incurred in any registration of the IDEX Shares
under this Agreement shall be paid by IDEX including, without limitation,
printing expenses, fees and disbursements of counsel for IDEX, expenses of any
audits to which IDEX shall agree or which shall be necessary to comply with
governmental requirements in connection with any such registration, all
registration and filing fees for the IDEX Shares under federal and state
securities laws, and expenses of complying with the securities or blue sky laws
of any jurisdictions; provided, however, that IDEX shall not be liable for (a)
any discounts or commissions to any underwriter (unless such discounts and
commissions are payable by reason of IDEX's desire to include the IDEX Shares
in an underwritten public offering that includes shares being sold for the
account of IDEX); (b) any stock transfer taxes incurred with respect to the
IDEX Shares sold in the offering or (c) the fees and expenses of counsel for
the Holder.

6. Indemnification.

(a) Company Indemnity. Without limitation of any other indemnity
provided to the Holder, to the fullest extent permitted by law, IDEX
shall indemnify and hold harmless the Holder, its affiliates, its counsel,
officers, directors, shareholders and representatives, any underwriter (as
defined in the Act) for the Holder, and each person, if any, who controls the
Holder or any such underwriter (within the meaning of the Act or the Securities
Exchange Act of 1934 (the "Exchange Act")), against any losses, claims, damages
or liabilities (joint or several) to which they may become subject under the
Act, the Exchange Act or any other federal or state law, and IDEX shall
reimburse the Holder, its affiliates, counsel, officers, directors,
shareholders and underwriters, and controlling persons thereof, for any legal
or other expenses incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any of the following (each a "Violation"): (i) any
untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto or (ii)
the omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading;
provided, however, that IDEX shall

<PAGE> 4

-4-

not be liable to the Holder in any such case for any such loss, claim,
damage, liability or action to the extent that it arises out of or is based
upon a Violation which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such registration by
the Holder, its affiliates, counsel, officers, directors, shareholders or
representatives, or any controlling person thereof.

(b) Holder Indemnity. Without limitation of any other indemnity
provided to IDEX, to the fullest extent permitted by law, the Holder shall
indemnify and hold harmless IDEX, its affiliates, its counsel, officers,
directors, shareholders and representatives, any underwriter (as defined in the
Act) for IDEX, and each person, if any, who controls IDEX or any such
underwriter (within the meaning of the Act or the Exchange Act), against any
losses, claims, damages or liabilities (joint or several) to which they may
become subject under the Act, the Exchange Act or any other federal or state
law, and the Holder shall reimburse IDEX, its affiliates, counsel, officers,
directors, shareholders and underwriters, and controlling persons thereof, for
any legal or other expenses incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any of the following: (i) any untrue statement or
alleged untrue statement of a material fact in the Registration Statement,
including any preliminary prospectus or final prospectus contained therein or
in any amendments or supplements thereto, to the extent provided by the Holder
to IDEX in writing expressly for use in connection with the registration of the
IDEX Shares or (ii) the omission or alleged omission to state a material fact
required to be stated therein or necessary to make the statements so provided
therein not misleading.

(c) Notice; Right to Defend. Promptly after receipt by an indemnified
party under this Section of notice of the commencement of any action (including
any governmental action) such indemnified party shall, if a claim in respect
thereof is to be made against any indemnifying party under this Section deliver
to the indemnifying party a written notice of commencement thereof and the
indemnifying party shall have the right to participate in and if the
indemnifying party agrees in writing that it will be responsible for any costs,
expenses, judgments, damages and losses incurred by the indemnified party with
respect to such claim, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless (i) the employment of such counsel shall have been authorized in writing
by the indemnifying party in connection with the defense of such action, (ii)
the indemnifying party shall not have employed counsel reasonably satisfactory
to such indemnified party to have charge of the defense of such action within a
reasonable time after notice of the commencement of the action, or (iii) such
indemnified party shall have been advised by counsel that there may be defenses
available to it which are different from or additional to those available
to the indemnifying party, in any of which events such fees and

<PAGE> 5

-5-

expenses of additional counsel shall be borne by the indemnifying party.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall relieve such
indemnifying party of any liability to the indemnified party under this
Agreement only if and to the extent that such failure is prejudicial to its
ability to defend such action, and the omission so to deliver written notice to
the indemnifying party will not relieve it of any liability that it may have to
any indemnified party otherwise than under this Agreement.

(d) Contribution. If the indemnification provided for in this
Agreement is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage or expense
referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage or
expense in such proportion as is appropriate to reflect the relevant fault of
the indemnifying party on the one hand and indemnified party on the other hand
in connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relevant fault of the indemnifying party and the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. Notwithstanding the foregoing, the amount the
Holder shall be obligated to contribute pursuant to the Agreement shall be
limited to an amount equal to the proceeds to the Holder of the IDEX Shares
sold pursuant to the registration statement which gives rise to such obligation
to contribute (less the aggregate amount of any damages which the Holder has
otherwise been required to pay in respect of such loss, claim, damage,
liability or action or any substantially similar loss, claim, damage, liability
or action arising from the sale of the IDEX Shares).

7. Survival of Indemnity. The indemnification provided by this Agreement
shall be a continuing right to indemnification and shall survive the
registration and sale of the IDEX Shares by any person entitled to
indemnification hereunder and the expiration or termination of this Agreement.

8. Notices. Unless otherwise provided in this Agreement, any notice,
request, instruction or other communication to be given hereunder by any party
to the other shall be in writing and (a) delivered personally, (b) mailed by
certified mail, postage prepaid (such mailed notice to be effective four days
after the date it is mailed) or (c) sent by facsimile transmission, with a
confirmation sent by way of one of the above methods, as follows:

<PAGE> 6

-6-

If to the Holder addressed to:

Mitchell H. Saranow
860 Auburn Road
Winnetka, Illinois 60093
Telephone: (847) 501-3045
Telecopier: (847) 501-3049

With a copy to:

Sidley & Austin
One First National Plaza
Suite 4000
Chicago, Illinois 60603
Attn: John J. Sabl, Esq.
Steven Sutherland, Esq.
Telephone:(312) 853-7567
Telecopier:(312) 853-7036

If to IDEX, addressed to:

IDEX Corporation
630 Dundee Road, Suite 400
Northbrook, Illinois 60062
Attn: Donald N. Boyce
Wayne P. Sayatovic
Telephone: (847) 498-7070
Telecopier: (847) 498-9123

With a copy to:

Hodgson, Russ, Andrews, Woods & Goodyear
Attn: Richard E. Heath, Esq.
David V.L. Bradley, Esq.
Frank J. Notaro, Esq.

1800 One M & T Plaza
Buffalo, New York 14203
Telephone: (716) 856-4000
Telecopier: (716) 849-0349

<PAGE> 7

- 7 -

and:

Latham & Watkins
Attn: Mark Stegemoeller
Sears Tower, Suite 5800
Chicago, Illinois 60606
Telephone: (312) 876-7700
Telecopier: (312) 993-9767

Any party may designate in a writing to any other party any other address or
telecopier number to which, and any other Person to whom or which, a copy of
any such notice, request, instruction or other communication should be sent.

9. Successors and Assigns. Except as otherwise expressly provided herein,
this Agreement shall inure to the benefit of and be binding upon the successors
and permitted assigns of IDEX and the Holder. The Holder shall have the right
to assign to any permitted transferee of the IDEX Shares his rights under this
Agreement.

10. Amendment and Waiver. This Agreement may be amended, and the
observance of any term of this Agreement may be waived, but only with the
written consent of IDEX and the Holder. No delay on the part of any party in
the exercise of any right, power or remedy shall operate as a waiver thereof,
nor shall any single or partial exercise by any party of any right, power or
remedy preclude any other or further exercise thereof, or the exercise of any
other rights, power or remedy.

11. Counterparts. One or more counterparts of this Agreement may be signed
by the parties, each of which shall be an original but all of which together
shall constitute one and same instrument.

12. Governing Law. This Agreement shall be construed in accordance with
and governed by the internal laws of the State of Illinois, without giving
effect to conflicts of law principles.

13. Invalidity of Provisions. If any provision of this Agreement is or
becomes invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not be affected thereby.

14. Headings. The headings in this Agreement are for convenience of
reference only and shall not be deemed to alter or affect the meaning or
interpretation of any provisions hereof.

<PAGE> 8

-8-

IN WITNESS WHEREOF, the undersigned has executed this Agreement as of the
date first above written.

IDEX CORPORATION

By /S/ Wayne P. Sayatovic
----------------------------
Wayne P. Sayatovic
Vice President

/S/ Mitchell H. Saranow
------------------------------
Mitchell H. Saranow

<ARTICLE> 5

<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 6,766
<SECURITIES> 0
<RECEIVABLES> 72,647
<ALLOWANCES> 2,107
<INVENTORY> 93,864
<CURRENT-ASSETS> 180,152
<PP&E> 226,283
<DEPRECIATION> 136,206
<TOTAL-ASSETS> 455,031
<CURRENT-LIABILITIES> 72,755
<BONDS> 185,650
<COMMON> 192
0
0
<OTHER-SE> 171,027
<TOTAL-LIABILITY-AND-EQUITY> 455,031
<SALES> 265,055
<TOTAL-REVENUES> 265,055
<CGS> 162,338
<TOTAL-COSTS> 217,902
<OTHER-EXPENSES> 53
<LOSS-PROVISION> 413
<INTEREST-EXPENSE> 8,291
<INCOME-PRETAX> 38,809
<INCOME-TAX> 13,933
<INCOME-CONTINUING> 24,876
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,876
<EPS-PRIMARY> 1.26
<EPS-DILUTED> 0

</TABLE>