8-K

   SECURITIES AND EXCHANGE COMMISSION

   Washington, D.C. 20549


   FORM 8-K

   CURRENT REPORT

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


   Date of Report (Date of earliest event reported): June 30, 1998
	     		 			    (June 15, 1998) 
 

	              WOODWARD GOVERNOR COMPANY               
	(Exact name of registrant as specified in its charter)


Commission File #0-8408


            Delaware                             36-1984010     
 
(State or other jurisdiction of       (IRS Employer Identification No.)
incorporation or organization)


5001 North Second Street, Rockford, Illinois 61125-7001
	(Address of principal executive offices)
	

Registrant's telephone number - (815) 877-7441



Item 2.  Acquisition or Disposition of Assets
	
On June 15, 1998 (effective as of the close of business on June 12,
1998), Woodward Governor Company (the Company) completed the previously
announced acquisition of Fuel Systems Textron, Inc. (FST), a subsidiary
of Textron Inc. (Textron).  This $160 million cash transaction was
financed by the Company with a line of credit facility from Wachovia
Bank, N.A..

FST is a leading designer, developer, and manufacturer of fuel
injection nozzles, spray manifolds, and fuel metering and distribution
valves for gas turbine engines in the aircraft (commercial and
military) and industrial markets, and also provides commercial repair
and overhaul services.  FST's facilities are located in Zeeland, MI,
Harvard, IL, and Greenville, SC and employ over 440 people.  Total 1997
revenues approximated $82 million.

In accordance with the acquisition agreement, the Company has the
option under Internal Revenue Code (IRC) Section 338(h)(10) to treat
the transaction as an asset purchase for tax purposes. As per the
agreement, the Company must notify Textron of this election by
September 1, 1998 and will be required to make an additional payment
to Textron, not to exceed $13.5 million, as compensation for the
additional tax liability Textron would recognize under this election.
The Company expects to elect Section 338(h)(10) treatment, as the
estimated future tax benefits outweigh the maximum required payment to
Textron.
    
The Company's press release dated June 22, 1998 regarding the completed 
transaction is attached as an Exhibit.

This report and the attached Exhibits contain forward-looking
statements reflecting management's current expectations concerning
the acquisition's impact on financial results and earnings per share,
the possibility of new products, and the potential for further revenue
growth. These statements involve risks and uncertainty.  Actual future
results and trends may differ materially depending on a variety of
factors, including the volume and timing of orders, the impact of
acquisition transition and integration efforts, the option to elect
Section 338(h)(10) treatment, and changes in pricing, product demand,
competition, product life cycles and business cycles.  All of these
matters are difficult to forecast.



Item 7.  Financial Statements and Exhibits

(a)  Financial Statements of Business Acquired

It is impracticable to provide the required historical and interim 
financial statements of FST at the date of this report.  Pursuant to 
the Commission's Rules and Regulations, the Company anticipates that 
any required financial statements will be filed by amendment to this 
report within 60 days after the date that this report is required to
be filed.

(b)  Pro Forma Financial Information

It is also impracticable to provide the required historical and interim 
pro forma financial information at the date of this report.  This 
information is expected to be filed with the Commission within 60 days.
 
(c)  Exhibits

Exhibit 2  -	Purchase and Sale Agreement by and between Textron Inc. 	
            	and Woodward Governor Company dated as of June 15, 1998. 

Exhibit 99 -	Press Release dated June 22, 1998.





SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of 1934, the 
registrant has duly caused this report to be signed on its behalf by the 
undersigned hereunto duly authorized.


		WOODWARD GOVERNOR COMPANY

	
June 26, 1998 	     /s/ Stephen P. Carter          
                     Stephen P. Carter, Vice President, 	
                     Chief Financial Officer and 
	                    Treasurer
 

EX-2

	PURCHASE AND SALE AGREEMENT

	Dated May 29, 1998

	BETWEEN

	TEXTRON INC., AS SELLER

	AND

	WOODWARD GOVERNOR COMPANY, AS PURCHASER








	PURCHASE AND SALE AGREEMENT

	This PURCHASE AND SALE AGREEMENT, is entered into on May 29, 
1998 ("Agreement"), by and between Textron Inc., a Delaware 
corporation having its principal place of business at 40 
Westminster Street, Providence, RI 02903 ("Seller") and Woodward 
Governor Company, a Delaware corporation having its principal 
place of business at 5001 North Second Street, Rockford, IL 61125  
("Purchaser").


RECITALS

	A.	Seller owns the only issued and outstanding Share, as 
hereinafter defined, of Fuel Systems Textron Inc. ("Company").

	B.	Company is engaged in the business of designing, 
manufacturing and selling fuel systems components for aircraft 
and industrial gas turbine engines (the "Business").

	C.	Purchaser desires to purchase and Seller desires to 
sell the Share on the terms and conditions set forth herein.

	AGREEMENT

	In consideration of the premises and of the mutual 
agreements hereinafter set forth, the parties hereto agree as 
follows:


	ARTICLE I
	Purchase and Sale

	1.1	Purchase of Share from Seller.  On the terms and 
subject to the conditions set forth in this Agreement, at the 
Closing Seller shall sell, transfer, convey, assign and deliver to 
Purchaser or Affiliates of Purchaser designated by Purchaser, free 
and clear of all Share Encumbrances, as hereinafter defined, and 
Purchaser or such Affiliates shall purchase, acquire and accept 
from Seller, the Share.  At the Closing, Seller shall deliver to 
Purchaser a certificate evidencing the Share duly endorsed for 
transfer and with all transfer stamps attached and such other 
instruments as may be reasonably requested by Purchaser to 
transfer full legal and beneficial ownership of the Share to 
Purchaser, free and clear of all Share Encumbrances.  Purchaser 
shall pay Seller the purchase price for the Share (the "Purchase 
Price") in accordance with the terms of this Agreement. The term 
"Affiliate," as to any person, means any other person that, 
directly or indirectly, through one or more intermediaries, 
controls, is controlled by or is under common control with such 
person.

	1.2	Purchase Price.  The Purchase Price shall be One 
Hundred Sixty Million Dollars ($160,000,000).

	1.3	Payment at Closing.  At the Closing, Purchaser shall 
transfer to a bank account or bank accounts designated by Seller 
an amount equal to the Purchase Price (the "Closing Payment") by 
a wire transfer of immediately available funds in U.S. currency.


	ARTICLE II
	Closing Matters

	2.1	The Closing.

		(a)	The purchase and sale (the "Closing") contemplated 
under this Agreement shall take place at the offices of Seller, 
located at 40 Westminster Street, Providence, RI 02903 or at such 
other place as the parties shall mutually agree upon, at 10:00 
A.M. local time on June 15, 1998, or such other time or such 
earlier date as the parties shall mutually agree upon, or such 
later date as may be required pursuant to paragraph (b) of this 
Section 2.1.  The date the Closing takes place is herein referred 
to as the "Closing Date."  The Closing shall be effective as of 
the close of business on June 12, 1998.

		(b)	If all applicable waiting periods under the 
Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended 
(the "HSR Act"), have not expired or been otherwise terminated, by 
the date set forth in paragraph (a) of this Section 2.1, the 
Closing shall, without the necessity of any action by or consent 
of either party hereto, be postponed until five days after the 
date of expiration or termination of the last such waiting period.

		(c)	At the Closing, Purchaser shall make the Closing 
Payment as provided in Section 1.3.

		(d)	At the Closing and effective on the Closing Date, 
Seller shall execute and deliver (or cause to be executed and 
delivered) to Purchaser:  (i) a certificate evidencing the Share 
as provided in Section 1.1; (ii) the opinion and certificates 
described in Article VI hereof; and (iii) all other documents, 
instruments and writings required to be delivered to Purchaser on 
or prior to the Closing Date pursuant to this Agreement.


	ARTICLE III
	Actions Prior to Closing

	3.1	Examinations and Investigations.  From and after the 
date hereof until the Closing, Seller shall provide and shall 
cause Company to provide Purchaser, its employees, consultants and 
representatives, including, its attorneys, accountants and 
financial advisors, access to the facilities of Company to make 
such investigations of the property and plant and such examination 
of the books (including Tax returns filed and those in 
preparation), personnel and additional financial and operating 
data and other information relating to Company (including, all 
documents, or copies thereof, listed in the schedules, and all 
files, records and papers of any and all proceedings and matters 
listed in the schedules) as Purchaser may reasonably request, and 
cause its officers, employees, consultants, agents, accountants 
and attorneys to cooperate fully with Purchaser and its 
representatives in connection with such review and examination; 
provided that:  (i) such access shall not unreasonably interfere 
with the operations of Company; (ii) in the reasonable opinion of 
Seller, the furnishing of such information shall not cause Seller 
to be in violation of any law or regulation or breach of 
attorney-client privilege; and (iii) until the Closing, Purchaser 
shall treat all information so obtained in accordance with the 
terms of the Confidentiality Agreement dated as of April 2, 1998 
between Seller and Purchaser (the "Confidentiality Agreement").

	3.2	Required Approvals.  Prior to the Closing Date, each 
party shall cooperate with the other to make all filings required 
by Law, as hereinafter defined in Section 4.11(a), to be made by 
them to consummate the transactions contemplated by this Agreement 
and the Related Documents, as hereinafter defined (the 
"Contemplated Transactions") (including all filings under the HSR 
Act).  Prior to the Closing Date, Seller shall, and shall cause 
Company to: (a) cooperate with Purchaser with respect to all 
filings that Purchaser is required by Law to make in connection 
with the transactions contemplated by this Agreement; and (b) 
cooperate with Purchaser in obtaining all third party consents 
identified in Schedule 4.5.

	3.3	Actions of Company and Conduct of Business.

		(a)	Seller shall use commercially reasonable efforts 
to perform and satisfy all conditions to Closing to be performed 
or satisfied by Seller under this Agreement by the Closing Date 
and to preserve intact in all material respects Company's current 
operations, physical facilities, working conditions, and 
relationships with lessors, lessees, licensors, licensees, 
suppliers, customers and employees.

		(b)	From the date hereof through the Closing Date, 
unless otherwise agreed in writing by Purchaser, Seller shall 
neither cause nor permit Company, except as required or expressly 
permitted pursuant to the terms hereof, to:  (i) make any material 
change in the conduct of the Business; or (ii) enter into any 
material transaction, in either case other than in the ordinary 
course of business; and Seller shall cause Company to continue to 
conduct the Business in the ordinary course of business.  Prior to 
the Closing, Seller shall cause Company to confer with Purchaser, 
to the extent reasonably practicable, on a regular basis as 
Purchaser may request, and report on significant operational 
matters and material decisions affecting the Business.

		(c)	Without limiting the generality of the foregoing, 
from the date hereof through the Closing Date, unless otherwise 
agreed in writing by Purchaser, Seller shall neither cause nor 
permit Company to:

			(i)	make any general wage or salary increases or 
any increases in any bonus, insurance, pension, retirement or 
other employee benefit plan affecting employees of Company 
generally except as is consistent with past practice;

			(ii)	mortgage, pledge or subject any of its 
assets, tangible or intangible to any Encumbrance other than 
Permitted Encumbrances, as each term is hereinafter defined;

			(iii)	except in the ordinary course of business, 
sell or transfer any of its material fixed assets or sell, 
transfer, or grant any license with respect to any Intellectual 
Property Rights as hereinafter defined;

			(iv)	enter into any agreements or contracts which 
require the delivery by it of a performance bond in an amount 
material to Company;

			(v)	make or commit to make any material capital 
expenditures relating to Company, except as set forth in the 
capital budget previously delivered to Purchaser; 

			(vi)	enter into any contract or agreement which, 
if in existence on the date hereof, would be required to be listed 
on Schedule 4.9, Part 1 or Schedule 4.9, Part 2 hereto or amend, 
modify or terminate, or waive any material right with respect to, 
any such contract or agreement; or

			(vii)	authorize or agree or otherwise become 
committed to do any of the foregoing.

		(d)	From the date hereof through the Closing Date, 
Seller and Company may follow their customary practices and 
procedures with respect to cash management, including the 
utilization of payroll accounts, concentration accounts, lockbox 
accounts, controlled disbursement accounts, electronic receipt 
accounts and any other miscellaneous bank accounts that Company 
may have.

	3.4	Actions of Purchaser.  Purchaser shall use commercially 
reasonable efforts to perform and satisfy all conditions to 
Closing to be performed or satisfied by Purchaser under this 
Agreement by the Closing Date. 

	3.5	Notification.  Between the date of this Agreement and 
the Closing Date, Seller shall promptly notify Purchaser in 
writing if Seller becomes aware of any fact or condition that 
causes any of Seller's representations and warranties to be 
inaccurate in any material respect as of the date of this 
Agreement, or if Seller becomes aware of the occurrence after the 
date of this Agreement of any fact or condition that would (except 
as expressly contemplated by this Agreement) cause any such 
representation or warranty to be inaccurate in any material 
respect. 

	3.6	Exclusivity.  Seller shall not (and Seller shall not 
cause or permit Company to):  (a) solicit, initiate, or encourage 
the submission of any proposal or offer from any person relating 
to the acquisition of any capital stock or other voting 
securities, or any substantial portion of the assets, of Company 
(including any acquisition structured as a merger, consolidation, 
or share exchange); or (b) participate in any discussions or 
negotiations regarding, furnish any information with respect to, 
assist or participate in, or facilitate in any other manner any 
effort or attempt by any person to do or seek any of the 
foregoing. 


	ARTICLE IV
	Representations and Warranties of Seller

Seller hereby represents and warrants to Purchaser as follows:

	4.1	Organization; Qualification.

		(a)	Each of Seller and Company is a corporation duly 
organized, validly existing and in good standing under the laws of 
the state of Delaware.

		(b)	Company has all requisite power and authority to 
own, lease and operate its properties and to conduct the business 
currently being conducted by it.  Company is duly qualified to 
transact business and is in good standing in each jurisdiction in 
which the character of the properties owned or leased by it or the 
nature of the business conducted by it makes such qualification 
necessary.

	4.2	Capitalization.  The authorized capital stock of 
Company consists of one hundred (100) authorized shares of Common 
Stock, par value $.01 per share ("Common Stock"), of which one (1) 
share is issued and outstanding on the date hereof.  The issued 
and outstanding share of Common Stock is referred to herein as the 
"Share."  The Share has been duly authorized and is validly 
issued, fully paid, nonassessable and free of preemptive rights. 
Company does not hold the Share in the treasury of Company.  
Except for this Agreement, there are not, and on the Closing Date 
there shall not be, outstanding any: (a) options, warrants or 
other rights with respect to the capital stock of Company; (b) any 
securities convertible into or exchangeable for shares of such 
capital stock or any other debt or equity security of Company; or 
(c) any other commitments of any kind for the issuance of 
additional shares of capital stock or other debt or equity 
security of Company or options, warrants or other rights with 
respect to such securities.

	4.3	Ownership of Share.

		(a)	The Share is owned beneficially and of record by 
Seller free and clear of any mortgages, liens, security interests 
or other encumbrances, charges, voting trusts, voting agreements, 
other agreements, rights, covenants, conditions, options, warrants 
or restrictions of any kind, nature or description ("Share 
Encumbrances"), and at the Closing Seller shall have, and shall 
deliver to Purchaser, good and marketable title to the Share, free 
and clear of any Share Encumbrances.

		(b)	Seller has the full and absolute right, power and 
authority to assign, transfer and deliver the Share.

	4.4	Subsidiaries.   Company does not have any subsidiaries.

	4.5	Corporate Action and Authority; No Conflict.  The 
execution and delivery by Seller of this Agreement and all other 
agreements, instruments and documents to be delivered by Seller 
hereunder (the "Related Documents") and Seller's performance of 
the Contemplated Transactions have been duly authorized by all 
requisite corporate action of Seller.  Seller has all requisite 
corporate power and authority to execute and deliver this 
Agreement and the Related Documents and to perform the obligations 
to be performed by it hereunder and thereunder, and to consummate 
the Contemplated Transactions.  This Agreement and the Related 
Documents have been duly and validly executed and delivered by 
Seller and is, and each of the Related Documents when executed and 
delivered by Seller in accordance with its terms shall be, the 
valid and binding obligation of Seller, enforceable against Seller 
in accordance with its respective terms.  Except as set forth in 
Schedule 4.5, none of the execution, delivery or performance by 
Seller of this Agreement or any of the Related Documents, the 
consummation by Seller of the transactions contemplated hereby or 
thereby, or compliance by Seller with any provision hereof or 
thereof shall:

		(a)	conflict with or result in a breach of any 
provision of the charter or by-laws of Seller or Company;

		(b)	violate any provision of law, statute, rule, 
regulation, or permit of any court or other governmental or 
regulatory authority or of any Order, as defined in Section 
4.10(b);

		(c)	conflict with, result in a breach of, constitute a 
default under, result in the acceleration of, create in any party 
the right to accelerate, terminate, modify or cancel, require any 
notice or consent under or result in the imposition of a security 
interest under, any Material Contract; or

		(d)	contravene or give any government body the right 
to revoke, withdraw, suspend or cancel any material permit or 
license held by Company.

	4.6	Financial Statements.  Set forth in Schedule 4.6(a) 
hereto are copies of the unaudited balance sheet of Company as at 
January 3, 1998 (the "Balance Sheet") and unaudited statements of 
operations and cash flow of Company for each of the three years in 
the period ended January 3, 1998, and set forth in Schedule 4.6(b) 
hereto is the unaudited balance sheet of Company as at May 2, 1998 
(the "May 2 Balance Sheet").  Such financial statements are 
collectively referred to herein as the "Financial Statements."  
Except as set forth in the Financial Statements or in the notes 
thereto, the Financial Statements have been prepared in accordance 
with generally accepted accounting principles consistently applied 
from the first day of the Company's 1995 fiscal year and fairly 
present on that basis the financial condition of Company as at 
January 3, 1998 and May 2, 1998, and the results of operations and 
cash flow of Company for each of the three years in the period 
ended January 3, 1998.

	4.7	Real Property.

		(a)	Schedule 4.7(a) lists all the real properties 
owned by Company (the "Owned Real Property").  Company has good 
and marketable title to the Owned Real Property, free and clear of 
Encumbrances other than Permitted Encumbrances, each as 
hereinafter defined.  As used in this Agreement, the term 
"Encumbrances" means, collectively, all easements, options, rights 
of first refusal, security interests, judgments, liens (other than 
for taxes not yet payable), mortgages, and encumbrances.  As used 
in this Agreement, the term "Permitted Encumbrances" means, 
collectively:  (i) any mechanics or materialmen's liens or similar 
Encumbrances arising or incurred in the ordinary course of 
business or which are being contested in good faith by appropriate 
proceedings; (ii) Encumbrances for Taxes not yet due and payable 
or which are being contested in good faith by appropriate 
proceedings; (iii) Encumbrances listed on Schedule 4.7(a) hereto; 
(iv) zoning, building and other similar restrictions which, 
individually or in the aggregate, would not have a material 
adverse effect on the marketability or value of such property or 
materially interfere with the operations of the Business; or (v) 
easements, licenses, covenants, rights of way and similar 
Encumbrances which, individually or in the aggregate, would not 
have a material adverse effect on the marketability or value of 
such property or materially interfere with the operations of the 
Business (collectively, the "Permitted Encumbrances").

		(b)	Except as listed in Schedule 4.7(b):  

			(i)	there are no leases, subleases, licenses, 
concessions or other agreements granting to any party or parties 
the right of use or occupancy of any portion of the Owned  Real 
Property:

			(ii)	there are no outstanding options or rights of 
first refusal to purchase the Owned Real Property or any portion 
thereof or interest therein; and

			(iii)	there are no pending, or to Seller's 
Knowledge, threatened condemnation proceedings, lawsuits, or 
administrative actions relating to any parcel of Owned Real 
Property or other matters affecting materially and adversely the 
current use, occupancy or value thereof.

		(c)	Schedule 4.7(c) lists all real property leased or 
subleased to Company (the "Leased Real Property").  Seller has 
delivered to Purchaser correct and complete copies of all leases 
relating to the Leased Real Property.   To Seller's Knowledge, 
each such lease is legal, valid, binding and enforceable and in 
full force and effect except where the illegality, invalidity, 
non-binding nature, unenforceability or ineffectiveness would not 
have a material adverse effect on the business, operations, 
properties, assets or financial condition of Company, considered 
as a whole ("Material Adverse Effect").  Neither Company nor, to 
Seller's Knowledge, the other party to each such lease is in 
default or breach thereunder in any material respect, and no event 
has occurred that with notice or the lapse of time or both would 
constitute a material default by Company, or to Seller's 
Knowledge, the other party thereto. 

		(d)	Except as listed in Schedule 4.7(d):  

			(i)	there are no subleases, licenses, concessions 
or other agreements granting to any party or parties the right of 
use or occupancy of any portion of the Leased  Real Property, and 
there are no parties who are in possession of space in the Leased 
Real Property to which they are not entitled;

			(ii)	to Seller's Knowledge, there are no 
outstanding options or rights of first refusal to purchase the 
Leased Real Property or any portion thereof or interest therein; 
and

			(iii)	to Seller's Knowledge, there are no pending 
or threatened condemnation proceedings, lawsuits, or 
administrative actions relating to any parcel of Leased Real 
Property.

		(e)	The Owned Real Property and the Leased Real 
Property are referred to collectively herein as the "Real 
Property." 
 
	4.8	Assets, Properties and Rights.

		Company has good, valid and marketable title to all of 
its assets and properties (other than the Owned Real Property), 
free and clear of all Encumbrances other than Permitted 
Encumbrances.  Company's assets and properties which are material 
to the conduct of the Business are free from material defects, 
have been maintained in accordance with normal industry practice, 
are in good operating condition and repair, subject to normal wear 
and tear, and are reasonably suitable for the purposes for which 
they are presently used.  The "assets and properties" of Company 
include all material assets and properties, interests in 
properties, and rights necessary for the conduct of the Business 
as presently conducted by Company.

	4.9	Contracts.

		(a)	Except as listed on Schedule 4.9(a), Part 1, there 
are no contracts, agreements, loan facilities, guarantees of 
payment or performance, license agreements, leases of personal 
property, conditional sales contracts, noncompetition agreements 
and confidentiality agreements to which Company is a party or 
pursuant to which Company's assets are subject or bound, and which 
extend beyond the Closing Date, other than:

			(i)	purchase orders entered into in the ordinary 
course of business which, in each case, involve purchases having a 
remaining value of less than $200,000;
 
			(ii)	sales contracts entered into in the ordinary 
course of business under which the value of remaining shipments is 
less than $500,000;

			(iii)	contracts which by their terms terminate or 
are unconditionally terminable by Company without penalty within 
one year after the date hereof and which individually involve an 
original commitment of less than $500,000; and

			(iv)	any other contracts which involve the 
remaining expenditure of less than $100,000 or the provision of 
goods and services with a remaining value of less than $100,000.  
(The contracts required to be listed in Schedule 4.9(a) are 
collectively referred to as the "Material Contracts").

	Schedule 4.9(a), Part 2 lists all contracts by and between 
Company and any of its Affiliates involving the expenditure of 
$100,000 or more, or involving the provision of goods, services or 
rights worth $100,000 or more.

	Schedule 4.9(a), Part 3 lists all contracts by and between 
Seller or any Affiliate of Seller (other than the Company) and any 
third party involving the provision to Company of goods, services 
or rights (except contracts with respect to employee benefits 
required to be set forth on Schedule 4.12) worth $100,000 or more.

		(b)	Except as listed on Schedule 4.9(b):  (i) Company 
has in all material respects performed all the material 
obligations required to be performed by it to date under each 
Material Contract; (ii) Company is not in material breach or 
default of any Material Contract; and (iii) no event has occurred 
or circumstance exists that (with or without notice or lapse of 
time) can reasonably be expected to contravene, conflict with, or 
result in a violation or breach of, or give any person the right 
to declare a default or exercise of any remedy under, or to 
accelerate the maturity or performance of, or to cancel, terminate 
or modify, any Material Contract.

		(c)	Schedule 4.9(c) lists (i) each existing Material 
Contract being renegotiated by Company as of the date hereof; and 
(ii) each prospective contract and agreement which if in effect as 
of the date hereof would have been listed as a Material Contract 
and which is being negotiated by Company as of the date hereof. 

		(d)	To Seller's Knowledge, none of Company's officers 
or key managers are subject to any contract or agreement which 
prohibits them from engaging in any business or which assigns to a 
third party the rights to any invention or intellectual property 
asset for which they were responsible, in whole or in part, for 
developing.

	4.10	Litigation.  

		(a)	Except as set forth in Schedule 4.10(a), there are 
no claims, actions, suits or proceedings pending, or to Seller's 
Knowledge, threatened, and to Seller's Knowledge there are no 
investigations pending or threatened, against Company or Seller or 
against the transactions contemplated by this Agreement, at law or 
in equity or before or by any court or other governmental agency 
or instrumentality, domestic or foreign, or any arbitral body, an 
adverse outcome of which would have a Material Adverse Effect.

		(b)	Except as set forth in Schedule 4.10(b):  (i) 
there is no Order to which Company or any of the assets owned or 
used by Company is subject; and (ii) Company is and has been in 
full compliance with all of the terms and requirements of each 
Order to which it, or any of the assets owned or used by it, is or 
has been subject. "Order" means any award, decision, injunction, 
writ, decree, judgment, order, ruling, subpoena, or verdict (with 
the exception of permits and other routine regulatory actions) 
entered, issued, made or rendered by any court, administrative 
agency, government body or arbitrator.

	4.11	Compliance with Law.  Except as listed on Schedule 
4.11(a) or as disclosed in Schedule 4.10 or elsewhere in this 
Agreement and the Schedules hereto:

		(a)	Seller has not received notice that Company is or 
may be in violation of any applicable foreign, federal, state or 
local law, statute, regulation, Order or government permit 
(collectively, "Law") where the consequences of such violation 
would have a Material Adverse Effect;

		(b)	Company is, and at all times since January 1, 1995 
has been, in full compliance with all Laws, the violation of which 
would have a Material Adverse Effect; and

		(c)	no event has occurred or circumstance exists that 
(with or without notice or lapse of time):  (i) may constitute or 
result in a violation by Company of, or a failure on the part of 
Company to comply with, any Law which violation or failure is 
likely to have a Material Adverse Effect; or (ii) is likely to 
give rise to any obligation on the part of Company to undertake, 
or to bear all or any portion of the cost of, any remedial action 
of any nature, which action is likely to have a Material Adverse 
Effect.

	4.12	Employee Benefit Plans. 
		
		(a)	With respect to any Employee or Former Employee, 
except as set forth on Schedule 4.12, neither Seller nor Company 
is a party to any "employee welfare benefit plan," as defined in 
Section 3(1) of the Employee Retirement Income Security Act of 
1974, as amended ("ERISA"), any "employee pension benefit plan," 
as defined in Section 3(2) of ERISA, or any bonus, incentive 
compensation, profit sharing, retirement, pension, group 
insurance, death benefit, cafeteria, flexible benefit, medical 
expense reimbursement, dependant care, stock option, stock 
purchase, stock appreciation rights, savings, deferred 
compensation, consulting, severance pay or termination pay, 
vacation pay, welfare or other employee benefit or fringe benefit 
plan, program or arrangement, and Company does not contribute to 
or have any liability under any "multiemployer plan," as defined 
in Section 3(37) of ERISA.  These plans are referred to 
collectively herein as the "Employee Benefit Plans."

		(b)	With respect to any Employee or Former Employee, 
each Employee Benefit Plan has been established, maintained and 
administered in all material respects in compliance with its terms 
and all applicable laws or regulations.

		(c)	With respect to any Employee or Former Employee, 
as each term is defined below in Section 9.1, Company has 
provided, or shall have provided, to individuals entitled thereto 
required notices within the applicable time periods and required 
coverage pursuant to Section 4980B of the Internal Revenue Code of 
1986, as amended (the "Code") with respect to any "qualifying 
event" (as defined in Section 4980B(f)(3) of the Code) occurring 
prior to and including the Closing Date, and no tax payable on 
account of Section 4980B of the Code has been incurred.

		(d)	With respect to each Employee Benefit Plan which 
is an "employee pension benefit plan" as defined in Section 3(2) 
of ERISA:  (i) neither any such Employee Benefit Plan nor any 
fiduciary of Seller or Company or any such Employee Benefit Plan 
has engaged in a "prohibited transaction" as defined in Section 
406 of ERISA or Section 4975 of the Code; (ii) all filings and 
reports as to each Employee Benefit Plan required to have been 
made on or before the Closing Date to the Internal Revenue Service 
(the "IRS") the Pension Benefit Guarantee Corporation ("PBGC"), 
the Securities Exchange Commission or the United States Department 
of Labor (the "DOL") have been or shall be made on or before such 
date; (iii) with respect to any Employee, except as disclosed on 
Schedule 4.12, there is no material litigation, governmental 
proceeding or investigation pending or to Seller's Knowledge 
threatened with respect to any such Employee Benefit Plan, its 
related trusts, or any fiduciary, administrator or sponsor of any 
such Employee Benefit Plan in said capacity; and there has not 
been any (iv) termination, or determination of the Secretary of 
the Treasury of partial termination, of any such Employee Benefit 
Plan, (v) commencement of any proceeding to terminate any such 
Employee Benefit Plan pursuant to ERISA, or (vi) written notice 
given to Seller or to the Company of the intention to commence or 
seek the commencement of any such proceeding with respect to any 
such Employee Benefit Plan, which, under subparagraph (iv), 
resulted or, under subparagraph (v) or (vi), would result in an 
insufficiency of plan assets necessary to satisfy benefits 
guaranteed under section 4022 of ERISA.

		(e)	With respect to each Employee Benefit Plan which 
is subject to Section 401(a) of the Code:  (i) Seller or Company 
has received a favorable determination letter as to qualification 
of each such Employee Benefit Plan under Code section 401(a) and 
each such Employee Benefit Plan meets the requirements of a 
"qualified plan" under Section 401(a) of the Code; (ii) each such 
Employee Benefit Plan has been funded in accordance with its 
governing documents, ERISA and the Code, there has been no 
accumulated funding deficiency, whether or not waived, at any 
time; (iii) there has been no "Reportable Event" within the 
meaning of section 4043 of ERISA which was required to have been 
reported under that section but was not reported; and (iv) all  
filings, premium payments, reports and notices as to each such 
Employee Benefit Plan required to have been made on or before the 
Closing Date to the PBGC have been or shall be duly made on or 
before that date.

		(f)	Except as set forth on Schedule 4.12, neither 
Seller nor Company has terminated any employee pension benefit 
plan subject to Title IV of ERISA.

		(g)	Except as set forth on Schedule 4.12, with respect 
to any Employee or Former Employee, neither Seller nor Company 
presently maintains, contributes to or has any liability under any 
funded or unfunded medical, health or life insurance plan or 
arrangement for present or future retirees or present or future 
terminated employees except as required by the Consolidated 
Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA").

		(h)	No amount payable to any Employee or Former 
Employee as result of or in connection with the transaction 
contemplated by this agreement will be an "excess parachute 
payment" which is non-deductible under Section 280G of the 
Internal Revenue Code.

		(i)	With respect to the Employees and Former 
Employees, no event has occurred with respect to which Company 
could be liable for a tax imposed by any of Sections 4972, 4976, 
4977 or 4980 of the Code, or for a civil penalty or other 
liability under Section 502(c) or Section 502(l) of ERISA.

		(j)	Except as set forth on Schedule 4.23, with respect 
to any Employee or Former Employee, neither Seller nor Company has 
promised, announced, or has any commitment to make any benefit 
increases or improvements under any Employee Benefit Plan, any 
amendments or restatements of any Employee Benefit Plan, or any 
new Employee Benefit Plan, program or arrangement, and neither 
Seller nor Company is aware of or involved in (or will, prior to 
Closing, permit) any amendment or modification of an Employee 
Benefit Plan, or any exercise of discretion, which may materially 
affect the interests of participants and beneficiaries in such 
Employee Benefit Plan.

		(k)	With respect to each of the Employee Benefit 
Plans, Seller has delivered to Purchaser true and complete copies 
of (where applicable):  (i) the plan documents, including  any 
related trust agreements, insurance contracts or other funding 
arrangements, or a written summary of the terms and conditions of 
the plan if there is no written plan document; (ii) the most 
recent determination letter received from the Internal Revenue 
Service; (iii) the most recent IRS Form 5500; (iv) the most recent 
actuarial valuation; (v) the most recent financial statement; and 
(vi) the most recent summary plan description.

4.13	Intellectual Property Rights. 

		(a)	Schedule 4.13 contains an accurate and complete 
list of (i) all patents, unregistered trademarks, trade names, 
assumed names, unregistered copyrights, and all applications 
therefor, owned, used or filed by Company and used in or necessary 
for the conduct of its business; (ii) all licenses, permissions 
and other agreements relating to the items listed in clause (i); 
and (iii) all agreements relating to technology, know-how, 
software or processes used in or necessary for the conduct of its 
business which Company  is licensed or authorized to use by 
others.  The Company has no registered trademarks or copyrights.

		(b)	Except as set forth in Schedule 4.13, (i) the 
patents and any applications therefor listed in Schedule 4.13 are 
duly recorded in the name of Company, (ii) to Seller's Knowledge, 
all patents, trademarks, trade names, assumed names and copyrights 
listed in Schedule 4.13 are valid, subsisting and enforceable, and 
(iii) Company has the sole and exclusive right, free from any 
Encumbrances, to use the patents, trademarks, trade names, assumed 
names and copyrights and applications therefor listed in Schedule 
4.13, and has good title to and the absolute (but not necessarily 
exclusive) right to use the technology, know-how and processes and 
all trade secrets and proprietary information (whether patentable 
or not) required for or incident to the conduct of its business, 
in the jurisdictions in which it conducts its business or where 
the products of its business are distributed, or services 
rendered; and the consummation of the transactions contemplated 
hereby will not alter or impair any such rights.  

		(c)	Except as set forth in Schedule 4.13, no claims 
have been asserted by any person with respect to the ownership, 
validity, enforceability or use of any such patents, trademarks, 
trade names, assumed names, copyrights, applications therefor, or 
any technology, know-how, processes, trade secrets or proprietary 
information owned or used by the Company or challenging or 
questioning the validity or effectiveness of any such license, 
permission or agreement and, to Seller's Knowledge, there is no 
valid basis for any such claim, and, to Seller's Knowledge, the 
use or other exploitation of such patents, trademarks, trade 
names, assumed names, copyrights, applications therefor, or any 
technology, know-how, processes and trade secrets and proprietary 
information by Company does not infringe, misappropriate or dilute 
the rights of any other person.  

		(d)	Except as disclosed in Schedule 4.13, to Seller's 
Knowledge, no other person is infringing, misappropriating or 
diluting the rights of Company with respect to such patents, 
trademarks, trade names, assumed names, copyrights, applications 
therefor, or with respect to any technology, know-how, processes, 
trade secrets or proprietary information owned or used by the 
Company.

		(e)	Except as disclosed in Schedule 4.13, Company has 
received no written notice from a third party that any product or 
service manufactured, marketed, distributed or sold or proposed 
to be manufactured, marketed, distributed or sold by Company 
violates or will violate any license or infringes or 
misappropriates or will infringe or misappropriate any rights of 
any other person.
 
		(f)	All of the active patents and patent applications 
listed on Schedule 4.13 are currently in compliance with formal 
legal requirements (including payment of filing, examination and 
maintenance fees).

		(g)	Company's policy is that all employees execute 
written agreements that assign to the Company all rights to any 
inventions, improvements, discoveries, or information relating to 
the business of Company and that contain provisions regarding the 
use and disclosure of confidential information relating to the 
business of Company; and, to the Seller's knowledge, all current 
employees of Company have executed such an agreement.

		(h)	Company has taken reasonable precautions to 
protect the secrecy, confidentiality and value of all trade 
secret and/or confidential, proprietary information used in or 
necessary for the conduct of Company's business.

		(i)	Company has in its possession engineering 
drawings, process flow documents, manufacturing procedures, bills 
of materials and routing sheets used in the operation of the 
Business.

	4.14	No Material Adverse Change.  Except as set forth on 
Schedule 4.14, there has been no material adverse change in the 
business, operations, properties, assets or financial condition of 
Company, considered as a whole, since the date of the Balance 
Sheet, and to Seller's Knowledge, no event has occurred or 
circumstance exists that is likely to result in such a material 
adverse change.

4.15	Environmental Matters. 

		(a)	For purposes of this Agreement, the following term 
shall have the meaning set forth herein:

			"Hazardous Wastes" means:

			(i)	hazardous materials, hazardous substances, 
extremely hazardous substances or hazardous wastes, as those terms 
are defined by the Comprehensive Environmental Response, 
Compensation and Liability Act, 42 U.S.C. (section) 9601 et seq., the 
Resource Conversation and Recovery Act, 42 U.S.C. (section) 6901 et seq., 
and any other Environmental and Safety Requirements;

			(ii)	petroleum, including crude oil or any 
fraction thereof which is liquid at standard conditions of 
temperature and pressure (60 degrees Fahrenheit and 14.7 pounds 
per square inch absolute);

			(iii)	any radioactive material, including, any 
source, special nuclear, or by-product material as defined in 42 
U.S.C. (section) 2011 et seq.;

			(iv)	asbestos in any form or condition; and

			(v)	any other material, substance or waste to 
which liability or standards of conduct may be imposed under any 
Environmental and Safety Requirements.

		(b)	Compliance With Environmental and Safety 
Requirements.  To Seller's Knowledge, and except as set forth in 
Schedule 4.15(b), each of Company and any tenants or subtenants of 
Seller or Company located on the Real Property is in compliance 
with all applicable federal, state and local laws, rules, 
regulations, ordinances and requirements relating to public health 
and safety, and pollution and protection of the environment, all 
as amended as of the Closing Date ("Environmental and Safety 
Requirements") and Company and any tenants or subtenants of Seller 
or Company located on the Real Property possess all required 
permits, licenses and certificates, and have filed all notices or 
applications required thereby pursuant to applicable Environmental 
and Safety Requirements (the "Permits").  Except as set forth in 
Schedule 4.15(b), there are no governmental notices or approval 
requirements related to the Permits arising as a result of the 
transactions contemplated by this Agreement.
 
		(c)	No Hazardous Wastes.  To Seller's Knowledge, and 
except as set forth in Schedule 4.15(c), neither Company nor any 
tenants or subtenants of Seller or Company located on the Real 
Property has ever generated, transported, treated, stored, or 
disposed of any Hazardous Wastes at any site, location or facility 
and no such Hazardous Wastes are present on, in or under the Real 
Property and the Real Property does not contain (including, 
containment by means of any underground storage tank) any 
Hazardous Wastes, except in compliance with applicable 
Environmental and Safety Requirements.
 
		(d)	No Actions or Proceedings.  To Seller's Knowledge, 
neither Company nor any tenants or subtenants of Seller or Company 
located on the Real Property has been subject to, or received any 
written notice of any private, administrative or judicial action, 
or any written notice of any intended private, administrative, or 
judicial action relating to the presence or alleged presence of 
Hazardous Wastes relating to Company, the Business, or the Real 
Property, and, to Seller's Knowledge, other than as set forth on 
Schedule 4.15(d), there is no reasonable basis for any such notice 
or action, and there are no pending or threatened actions or 
proceedings (or notices of potential actions or proceedings) from 
any governmental agency or any other entity regarding any matter 
relating to health, safety or protection of the environment.

	4.16	Tax Returns and Payments.  Except as set forth in 
Schedule 4.16(a) or as reflected or reserved against in the 
Financial Statements:  (i) Seller's Group (as defined in Section 
15.12(d)) has timely filed or caused to be timely filed all 
federal, state and foreign Income Tax Returns and all other 
Returns (as defined in Section 15.12(b)) that are required to be 
filed on or before the date hereof for each taxable period during 
which Company has been a member of Seller's Group, and all such 
Income Tax Returns and all other Returns are accurate and complete 
in all material respects, (ii) all federal, state, foreign and 
other Income Taxes and all other material Taxes (as defined in 
Sections 15.12(a) and 15.12(c), respectively) due and payable on 
or before the date hereof, relating to the business or assets of 
Company, have been paid, (iii) no claim for assessment or 
collection of Taxes, relating to the business or assets of Company 
has been asserted in writing by the Internal Revenue Service 
("IRS") or any other taxing authority, (iv) the statute of 
limitations has expired with respect to all Income Tax Returns and 
all other Returns, and neither Company nor Seller's Group (or any 
member thereof) has consented to extend the time in which any Tax 
may be assessed or collected by the IRS or any other taxing 
authority, (v) neither Company nor Seller's Group (or any member 
thereof) has extended the time with respect to the date on which 
any Income Tax Return or other Return was or is to be filed, (vi) 
there are no ongoing or pending Tax audits, examinations, or 
investigations by the IRS or any other taxing authority against 
Company or Seller's Group (or any member thereof), (vii) Company 
has no liability for Income Taxes under Treasury Regulations 
Section 1.1502-6 as a result of being a member of a consolidated 
group within the meaning of Section 1504(a) of the Code, other 
than Seller's Group, (viii) no consent has been filed relating to 
any assets or property of Company or Seller's Group (or any member 
thereof) pursuant to Section 341(f) of the Code, (ix) any 
tax-indemnity, tax-sharing, tax-allocation, or similar agreements 
(all of which are listed on Schedule 15.1) of Company and any 
liability or obligation of Company under such agreements shall 
terminate as of the Closing Date and be of no further force or 
effect for any taxable period, (x) Company does not have, and has 
not had, a permanent establishment (as defined by applicable tax 
treaty) or other taxable presence in any foreign country, (xi) 
Company is not a party to any joint venture, partnership, or other 
arrangement or contract that could be treated as a partnership for 
Tax purposes, (xii) Company has not granted any powers of attorney 
with respect to matters relating to Tax, other than those required 
by consolidated return regulations under the Code (xiii) there is 
no closing agreement, compromise, or settlement with the IRS or 
any other taxing authority that is binding on Company for any 
taxable period ending after the Closing Date, (xiv) there are no 
requests for rulings or determinations relating to Company pending 
with the IRS or any other taxing authority, (xv) Seller has made 
available to Purchaser for inspection true, correct, and complete 
copies of all Tax Returns filed, and statements of deficiency 
assessed against or agreed to by Company (or any other entity or 
person on behalf of Company) for the taxable periods of Company as 
to which the statutes of limitations with respect to Taxes have 
not expired, and (xvi) Company has no liability for Income Taxes 
under Treasury Regulations Section 1.1502-6 as a result of being 
owned by or affiliated with any entity or person except Seller or 
an entity affiliated with Seller.  Seller has provided Purchaser 
with schedules setting forth the tax basis of Company's assets, 
the amounts of any operating loss, net capital loss, and unused 
credits of Company, and the amount of any deferred gain or loss 
allocable to Company arising from any intercompany or intragroup 
transaction.

	4.17	Labor Matters.    Except as disclosed on Schedule 4.17, 
(a) Company is not a party to or subject to any collective 
bargaining agreement with any labor organization with respect to 
any of its operations, (b) there are no agreements with labor 
unions, work councils or associations representing employees of 
Company; (c) there are no current strikes, slowdowns, picketing, 
work stoppages, or other occurrences, events or conditions of a 
similar character in which any of said employees are 
participating.

	4.18	Intercompany Services.  Schedule 4.18 sets forth all 
services (other than sales of products in the ordinary course of 
business) provided within the last twelve months by Seller and its 
Affiliates to Company or by Company to Seller and its Affiliates.

	4.19	Undisclosed Liabilities. Except as set forth on 
Schedule 4.19, Company has no liabilities or obligations of any 
nature (whether absolute, accrued, contingent or otherwise) which 
should be reflected or reserved against in or disclosed in the 
notes to the May 2 Balance Sheet, except for liabilities or 
obligations reflected or reserved against in or disclosed in the 
notes to the May 2 Balance Sheet and liabilities incurred in the 
ordinary course of business since the date thereof.

	4.20	Notes and Accounts Receivable.  All of Company's notes 
and accounts receivable that are reflected on the May 2 Balance 
Sheet represent valid obligations of the obligor and are 
receivables recorded in accordance with generally accepted 
accounting principles.

	4.21	Product Warranties.  Except as set forth on Schedule 
4.21, Company has no material liability (whether known or unknown, 
whether asserted or unasserted, whether absolute or contingent, 
whether accrued or unaccrued, whether liquidated or unliquidated, 
and whether due or to become due) with respect to products sold, 
manufactured, leased or delivered or for replacement or repair 
thereof or other damages in connection therewith, subject only to 
the reserve for product warranty claims set forth in the May 2 
Balance Sheet (including any notes thereto) as adjusted for 
operations and transactions through the Closing Date in accordance 
with the past custom and practice of Company.

	4.22	Product Liability.  Schedule 4.22 sets forth Company's 
product liability claim history for the last three (3) years, 
including the nature and amounts of all product liability claims, 
the identity of the claimants, and any amounts paid by Company in 
connection with such claims.

	4.23	Absence of Certain Changes and Events.  Except as set 
forth in Schedule 4.23, since the date of the Balance Sheet, 
Company has conducted its business only in the ordinary course of 
business and there has not been any:

		(a)	wage or salary increases or any increases in any 
bonus, insurance, pension, retirement or other employee benefit 
plan affecting employees of Company except as is consistent with 
past practice or entry into any employment, severance or similar 
contract with any director, officer, or key manager of the 
Company;

		(b)	damage to or destruction or loss of any asset or 
property of Company, whether or not covered by insurance, which 
would have a Material Adverse Effect;

		(c)	sale (other than sales of inventory in the 
ordinary course of business), lease, or other disposition of any 
material asset or property of Company or mortgage, pledge, or 
imposition of any Encumbrance on any material asset or property of 
Company, including the sale, lease, or other disposition of any 
material Intellectual Property Assets;

		(d)	cancellation or waiver of any claims or rights 
with a value to Company in excess of $100,000;

		(e)	material change in the accounting methods used by 
Company; or

		(f)	agreement, whether oral or written, by Company to 
do any of the foregoing.


	ARTICLE V
	Representations and Warranties of Purchaser

Purchaser hereby represents and warrants to Seller as follows:

	5.1	Organization and Authority.  Purchaser is a corporation 
duly organized, validly existing and in good standing under the 
laws of the State of Delaware, and Purchaser has all requisite 
corporate power and authority to own, lease and operate its 
properties and to carry on its business as now being conducted, to 
execute and deliver this Agreement and the Related Documents and 
to perform the obligations to be performed by it hereunder and 
thereunder, and to consummate the transactions contemplated hereby 
and thereby. 

	5.2	Corporate Action; No Conflict.  The execution, delivery 
and performance by Purchaser of this Agreement and the Related 
Documents to be delivered by Purchaser and the consummation of the 
transactions contemplated hereby and thereby have been duly and 
validly authorized by all necessary corporate action on the part 
of Purchaser.  This Agreement has been duly and validly executed 
and delivered by Purchaser and is, and each of the Related 
Documents when executed and delivered by Purchaser in accordance 
with its terms shall be, the valid and binding obligation of 
Purchaser.  Neither the execution, delivery or performance by 
Purchaser of this Agreement or any Related Document, nor the 
consummation by Purchaser of the transactions contemplated hereby 
or thereby, nor compliance by Purchaser with any provision hereof 
or thereof shall (i) conflict with or result in a breach of any 
provision of the charter or by-laws of Purchaser or, (ii) violate 
any provision of law, statute, rule or regulation or any order, 
writ, injunction, permit, judgment or decree of any court or other 
governmental or regulatory authority applicable to Purchaser.

	5.3	Funding of Purchase Price.  Purchaser has sufficient 
cash or other contractually committed sources of financing to 
consummate the purchase of the Business and shall at Closing have 
funds available sufficient to pay the Purchase Price.

	
ARTICLE VI
	Conditions to Obligations of Purchaser

	The obligations of Purchaser under this Agreement are, at its 
option, subject to the fulfillment, on or before the Closing Date, 
of each of the following conditions precedent:

	6.1	Performance of Covenants.  Seller shall have performed 
and complied with all terms, covenants and conditions required by 
this Agreement to be performed or complied with by it on or before 
the Closing Date.

	6.2	Accuracy of Representations.  

		(a)	All of Seller's representations and warranties in 
this Agreement (considered both individually and collectively) 
must have been accurate in all material respects as of the date of 
this Agreement, and must be accurate in all material respects as 
of the Closing Date as if made on the Closing Date, and Purchaser 
shall have received at the Closing a certificate of an officer of 
Seller, dated as of the Closing Date, to such effect.

		(b)	Seller's representations and warranties in 
Sections 4.2, 4.3 and 4.6 must have been accurate in all respects 
as of the date of this Agreement and as of the Closing Date as if 
made on the Closing Date, and Purchaser shall have received at the 
Closing a certificate of an officer of Seller, dated as of the 
Closing Date, to such effect.

	6.3	Opinion of Counsel.  Purchaser shall have received from 
W. Robert Kemp, Corporate Counsel, Textron Inc., counsel to 
Seller, an opinion dated the Closing Date, substantially in the 
form of Exhibit A.

	6.4	HSR Act.  All applicable waiting periods (including any 
extensions thereof) required under the HSR Act shall have expired 
or been terminated, without the threat or initiation of legal 
action by the Federal Trade Commission or the Department of 
Justice.

	6.5	No Proceedings. There shall not be pending or 
threatened, any claim, suit, action or other proceeding brought by 
any governmental agency before any court, tribunal or governmental 
agency, seeking to prohibit or restrain the transactions 
contemplated by this Agreement, seeking material damages in 
connection therewith, or that may have the effect of preventing, 
delaying, making illegal, or otherwise interfering with any of the 
transactions contemplated by this Agreement; and there shall not 
be pending or threatened, any claim, suit, action or other 
proceeding brought by any third party before any court, tribunal 
or governmental agency, seeking to prohibit or otherwise restrain 
to a material degree the transactions contemplated by this 
Agreement, seeking material damages in connection therewith, or 
that may have the effect of preventing, delaying, making illegal, 
or otherwise interfering to a material degree with any of the 
transactions contemplated by this Agreement.

	6.6	Authorization.  All action necessary to authorize the 
execution, delivery and performance by Seller of this Agreement 
and each of the Related Documents and the consummation of the 
transactions contemplated hereby and thereby shall have been duly 
and validly taken by Seller, and Seller shall have full power and 
right to consummate the transactions contemplated hereby and 
thereby.

	6.7	Secretary's Certificate.  Seller shall have delivered 
to Purchaser certificates of the Secretary or Assistant Secretary 
of Seller and Company as to the charter, by-laws, corporate 
resolutions and incumbency of officers of Seller and Company in 
form and substance reasonably satisfactory to Purchaser.

	6.8	Resignations.  Purchaser shall have received duly 
signed resignations, effective immediately after the Closing, of 
all directors and officers of Company other than those whom 
Purchaser shall have specified in writing at least five business 
days prior to the Closing.

	6.9	Consents.  Each third party consent identified in 
Schedule 6.9 shall have been obtained and must be in full force 
and effect.


	ARTICLE VII
	Conditions to Obligations of Seller

	The obligations of Seller under this Agreement are, at its 
option, subject to the fulfillment, on or before the Closing Date, 
of each of the following conditions precedent:

	7.1	Performance of Covenants.  Purchaser shall have 
performed and complied with all terms, covenants and conditions 
required by this Agreement to be performed or complied with by it 
on or before the Closing Date.

	7.2	Representations and Warranties. The representations and 
warranties of Purchaser contained in this Agreement shall be true 
and correct as of the Closing Date in all material respects as 
though such representations and warranties had been made as of the 
Closing Date, and Seller shall have received at the Closing a 
certificate of an officer of Purchaser, dated as of the Closing 
Date, to such effect.

	7.3	Opinion of Counsel.  Seller shall have received from 
Robert Reuterfors, legal counsel to Purchaser, an opinion dated 
the Closing Date, substantially in the form of Exhibit B.

	7.4	HSR Act.  All applicable waiting periods (including any 
extensions thereof) required under the HSR Act shall have expired 
or been terminated, without the threat or initiation of legal 
action by the Federal Trade Commission or the Department of 
Justice;

	7.5	No Proceedings.  There shall not be pending or, 
threatened, any claim, suit, action or other proceeding by any 
governmental agency before any court or governmental agency, 
seeking to prohibit or restrain the transactions contemplated by 
this Agreement or to obtain damages in connection therewith.

	7.6	Authorization.  All action necessary to authorize the 
execution, delivery and performance of this Agreement and each of 
the Related Documents, and the consummation of the transactions 
contemplated hereby and thereby shall have been duly and validly 
taken by Purchaser, and Purchaser shall have full power and right 
to consummate the transactions contemplated hereby and thereby.

	7.7	Secretary's Certificate.  Purchaser shall have 
delivered to Seller a certificate of the Secretary or Assistant 
Secretary of Purchaser as to the charter, by-laws, corporate 
resolutions applicable to this Agreement and the Related Documents 
and the transactions contemplated hereby and thereby, and 
incumbency of officers of  Purchaser in form and substance 
reasonably satisfactory to Seller.


	ARTICLE VIII
	Environmental Matters

	8.1	Environmental Indemnification.  

		(a)	Seller will indemnify and hold harmless Purchaser 
and its Affiliates for, and will pay to Purchaser and its 
Affiliates the amount of, any Damages arising, directly or 
indirectly, from or in connection with:

			(i)	any Environmental and Safety Requirements 
arising out of or relating to: 

				(A)	the ownership, operation, or condition 
at any time on or before the Closing Date of the Real Property or 
any other properties and assets (whether real, personal, or mixed 
and whether tangible or intangible) other than the Real Property 
(collectively, the "Other Property"), which were or are owned, 
operated or otherwise used by Company or any other persons or 
entities for whose conduct Company is or may be held responsible, 
including any entity merged with or acquired by Company or for 
which Company has successor liability for environmental matters 
under applicable law (collectively, the "Predecessors");

				(B)	any Hazardous Wastes that were present 
on the Real Property or Other Properties at any time on or before 
the Closing Date;

				(C)	any Hazardous Wastes, wherever located, 
that were, or were allegedly, generated, transported, stored, 
treated, disposed, released, or otherwise handled by Seller or 
Company or any Predecessor at any time on or before the Closing 
Date; 

				(D)	any activities that were, or were 
allegedly, conducted by Seller or Company or by any Predecessor at 
any time on or before the Closing Date; or

			(ii)	any bodily injury (including illness, 
disability, and death, and regardless of when any such bodily 
injury occurred, was incurred, or manifested itself), personal 
injury, property damage (including trespass, nuisance, wrongful 
eviction, and deprivation of the use of real property), or other 
damage of or to any person or entity, in any way arising from or 
allegedly arising from any activity conducted or allegedly 
conducted with respect to the Real Property, Other Property or the 
operation of Company before the Closing Date,  relating to:

				(A)	Hazardous Wastes present or suspected to 
be present on or before the Closing Date on or at the Real 
Property or Other Property (if such Hazardous Waste emanated or 
allegedly emanated from any of the Real Property or Other Property 
and was present or suspected to be present on any of the Real 
Property or Other Property on or before the Closing Date); or

				(B)	Hazardous Wastes released or allegedly 
released by Seller or Company or any Predecessor on the Real 
Property or Other Property before the Closing Date.

		(b)	Notwithstanding anything in Section 8.1(a) to the 
contrary, with respect to Seller's indemnification obligations in 
connection with matters arising from or allegedly arising from the 
ownership, operation or condition (including the presence or 
suspected presence of Hazardous Wastes) of the Real Property on or 
prior to the Closing Date:

			(i)	Seller's liability for indemnification  shall 
be subject to the monetary thresholds and limitations set forth in 
Section 14.1 hereof;

			(ii)	Seller shall have no liability for 
indemnification with respect to such matters unless Purchaser 
asserts a claim for indemnification within ten (10) years after 
the Closing Date; provided, however, that if, prior to the tenth 
anniversary of the Closing Date, any person or entity that is not 
an Affiliate of Purchaser or Company ("Subsequent Purchaser") 
acquires some or all of the Owned Real Property, the 
indemnification obligations of Seller under this Article VIII 
relating to the Owned Real Property so acquired shall extend to 
the tenth anniversary of the closing of such transaction; provided 
Subsequent Purchaser expressly agrees in writing to be bound by 
the provisions of this Article VIII; and

			(iii)	Seller shall have no responsibility for 
remediation of the Real Property beyond the standards applicable 
to industrial property, unless a government agency orders 
remediation to a more stringent standard.

		(c)	Except as otherwise provided in Section 8.1(b), 
Purchaser's right to indemnification under this Article VIII shall 
be unlimited (payable from the first dollar, without limit), 
provided that Purchaser must assert any indemnification claims 
under this Article VIII prior to the expiration of the applicable 
statute of limitations for such claims.

	8.2	Liability for Shipment or Disposal.  Notwithstanding 
anything in Section 8.1 to the contrary, Seller shall after 
Closing forever assume all liabilities and obligations relating 
to, and will indemnify and hold harmless Purchaser and its 
Affiliates for, and will pay to Purchaser and its Affiliates the 
amount of any Damages arising directly or indirectly from or in 
connection with the actual or alleged shipment or disposal by 
Company or the arrangement of shipment or disposal by Company of 
Hazardous Wastes prior to the Closing Date, including but not 
limited to all liabilities and obligations and Damages in 
connection with the locations identified on Schedule 8.2.
	
	8.3	Cooperation by Purchaser.  Purchaser agrees to provide, 
and to cause Company to provide reasonable cooperation to Seller 
in performing its obligations hereunder, including:  (i) giving 
Seller prompt written notice of any claim, demand, or other notice 
with respect to which indemnity may be sought under this Article 
VIII; (ii) providing Seller and Seller's agents, contractors and 
consultants, and relevant government officials, with reasonable 
access (at no charge) to the Real Property to conduct any 
necessary investigation or remedial action, including sampling, 
monitoring, treatment, installation of equipment, construction of 
facilities, removal and disposal, subject to such reasonable 
regulation of access to Company's property, such as the 
requirement of proof of insurance, as may be generally applicable 
to third parties seeking access to Company's facilities;   (iii) 
providing Seller and its agents, contractors and consultants with 
any records, documents and other data in its possession relevant 
to indemnification obligations; and (iv) otherwise providing such 
assistance reasonably necessary to enable Seller to comply with 
its obligations under this Article VIII.

	8.4	Environmental Response Action.  Seller at its sole 
option shall have the right to control the manner and method of 
any investigation and remediation of the Real Property necessary 
to satisfy its indemnification obligations under Section 8.1(b) 
("Environmental Response Actions"), including, but not limited to,  
selection of consultants and contractors (subject to Purchaser's 
approval of such consultants and contractors, which approval shall 
not be unreasonably withheld) and any communications with 
government authorities (provided that Purchaser is provided with 
advance copies and an opportunity to comment on such 
communications with governmental authorities and provided further, 
that while Seller shall consider Purchaser's comments in good 
faith, Seller's decision as to the communication shall be final), 
so long as such Environmental Response Action is conducted in 
accordance with applicable Environmental and Safety Requirements 
and in a manner so as to avoid interference with Purchaser's use 
of the Real Property (including access to or egress therefrom) to 
the extent commercially practicable.

	8.5	Subsurface Sampling.
	  
	       (a) It shall be a condition to Seller's obligations 
under Section 8.1(b) that neither Purchaser nor Company shall 
undertake any investigation that would involve subsurface sampling 
or excavation unless such investigation is (i) the result of a 
demand or claim by a governmental authority or other third party 
(other than an Affiliate of Purchaser or Company, or (ii) 
necessary to comply with the requirements of applicable 
Environmental Laws for industrial real property and carried out 
with Seller's consent, which shall not be unreasonably withheld; 
provided, however, that such prior consent of Seller need not be 
obtained if the delay required to do so would prevent Company from 
complying in a timely manner with applicable Environmental and 
Safety Requirements, provided that in such case Purchaser or 
Company shall notify Seller as soon as reasonably possible.
	
	   	 (b) Notwithstanding anything to the contrary in 
8.5(a), Purchaser or Company may conduct subsurface sampling or 
excavation (i) necessary for normal maintenance of existing 
structures and improvements currently existing at the Real 
Property or for the expansion of existing structures or 
construction of new structures on the Real Property; or (ii) 
required by a Subsequent Purchaser of the Owned Real Property or 
by a third party in contemplation of providing financing to 
Purchaser or Company secured by the Owned Real Property, in each 
case so long as the identity of the consulting firm conducting 
such sampling and the work plan for such sampling are provided to 
Seller sufficiently in advance of the commencement of work that 
Seller has a reasonable opportunity to comment, and Seller 
receives a copy of any data from such sampling. 

	8.6	Exclusive Remedy.  The indemnities set forth in this 
Agreement with respect to Environmental and Safety Requirements 
constitute the sole and exclusive obligation of Seller with 
respect to the environmental condition of the Real Property, and, 
with respect to the environmental condition of the Real Property, 
Purchaser covenants not to bring suit against Seller with respect 
to Environmental and Safety Requirements (a) under any state, 
federal or local statute, rule or regulation, including, but not 
limited to, The Comprehensive Environmental Response, 
Compensation, and Liability Act ("CERCLA") or (b) at common law 
except to enforce the provisions of such indemnities.  
	
	8.7     Illinois Real Property Transfer Statute.  Seller 
shall provide to Buyer and Wachovia Bank, N.A. (the "Lender") on 
or before June 5, 1998, a Disclosure Document, as defined in 
Article 5 of the Illinois Responsible Property Transfer Act of 
1988, 765 ILCS 90/1 et. seq. ("the Act"), in such form as is 
reasonably acceptable to Buyer and Lender.  Delivery of the 
Disclosure Document by June 5, 1998, will cause Buyer and Lender 
to waive the time period specified in the Act by executing the 
Waiver form attached as Exhibit 8.7, indicating that each of Buyer 
and Lender is aware of the purpose and intent of the Disclosure 
Document.  Buyer shall be responsible for recording the Disclosure 
Document in accordance with the Act, and Seller is indemnified 
against any penalty assessed for failure to so record.


ARTICLE IX
Employee Matters
	
9.1    Scope of Article.   This Article IX contains the 
covenants and agreements of the parties with respect to (a) the 
employees of Company whose employment with the Business has not 
ended as of the Closing (the "Employees"), (b) former employees 
of Company whose employment with Company terminated before the 
Closing (whether by retirement or otherwise) and who were 
employed by Company immediately before such termination of 
employment (the "Former Employees") and (c) Employee Benefit 
Plans. 

9.2	Benefits and Compensation.   Purchaser shall provide, 
effective as of the Closing Date, employee compensation and 
benefit plans, programs, policies and arrangements (including 
fringe benefits and severance pay) that, in the aggregate, will 
provide benefits and compensation to the Employees that are for a 
period of at least one year after the Closing Date, comparable in 
the aggregate to those provided by Seller to the Employees 
immediately prior to the Closing Date.  Notwithstanding the 
foregoing, Purchaser shall agree to provide to salaried Employees 
under Purchaser's Salaried Pension Plan (see Section 9.3(a) 
below) a benefit which will be no less than the benefit that 
would be calculated under Seller's Salaried Pension Plan for each 
such salaried Employee, taking into account such Employee's 
credited service under Seller's Salaried Pension Plan as of the 
Closing Date and such Employee's compensation from the Purchaser 
as of the earlier of the date his employment with the Purchaser 
ends or the Purchaser's Salaried Pension Plan is terminated.

9.3	Pension Plans.

(a)  Purchaser shall adopt, effective as of the Closing 
Date, but no later than December 31, 1998, one or more pension 
plans, including a tax-qualified defined benefit plan for 
salaried Employees ("Purchaser's Salaried Pension Plan") and a 
tax-qualified defined benefit plan or plans for hourly Employees 
("Purchaser's Hourly Pension Plans"), which shall discharge the 
pension obligations set forth in this Section 9.3(a). Subject to 
the transfer of assets described in this Section 9.3(a), 
Purchaser's Salaried Pension Plan shall assume the liabilities as 
of the Closing Date for the benefits of all salaried Employees 
participating in the Textron Pension Plan ("Seller's Salaried 
Pension Plan"), and Purchaser's Hourly Pension Plans shall assume 
the liabilities as of the Closing Date for the benefits of all 
hourly Employees participating in the Fuel Systems Textron Inc. 
Hourly Pension Plan (Holland and Zeeland, MI) and the Fuel 
Systems Textron Inc. Hourly Pension Plan (Harvard IL) 
(collectively, the "Seller's Hourly Pension Plans"), which 
Seller's Hourly Pension Plans were merged into the Textron 
Pension Plan effective December 31, 1995.  The Seller's Salaried 
Pension Plan and the Seller's Hourly Pension Plans shall be 
referred to collectively hereafter as the "Seller's Pension 
Plans," and the Purchaser's Salaried Pension Plan and Purchaser's 
Hourly Pension Plans shall be referred to collectively hereafter 
as the "Purchaser's Pension Plans."

Purchaser shall, as soon as practicable after the Closing Date, 
submit Purchaser's Pension Plans to the IRS with Purchaser's 
requests for favorable determination of the qualified status of 
the Purchaser's Pension Plans. Purchaser may, but is not required 
to work, with Seller's outside counsel or consultants through the 
Cutoff Date, as defined in the following paragraph, to set up the 
Purchaser's Pension Plans and to file any annual reports for the 
Purchaser's Pension Plans.

On a day which is within 60 days after the later of (i) the date 
upon which the Purchaser delivers to the Seller notice that the 
Purchaser's actuaries, pursuant to Section 9.3(c) of this 
Agreement, have reviewed the calculations of Seller's actuaries 
and are satisfied that such calculations are in accordance with 
this Agreement and (ii) the first day of the calendar month which 
begins after the Purchaser delivers to Seller copies of the 
favorable IRS determination letters for the Purchaser's Pension 
Plans (the "Transfer Date"), Seller shall cause the trustee under 
Seller's Pension Plans to transfer to the trustee or trustees 
under Purchaser's Pension Plans cash assets in an amount equal to 
the sum of (i) the amount necessary to satisfy the applicable 
requirements of sections 414(l) and 401(a)(12) of the Code as of 
the Closing Date by using the assumptions and methods specified 
in Schedule 9.3(a) and (ii) $500,000.   Notwithstanding the 
above, from the period beginning on the Transfer Date and ending 
on a date to be determined by Purchaser (but not later than the 
last day of the Purchaser's 1998 fiscal year or December 31, 
1999, whichever is later) (the "Cutoff Date"), the group trustee 
for Textron's Master Trust shall be appointed the trustee for 
Purchaser's Pension Plans, and Purchaser and Seller shall take 
any and all actions to ensure that the Purchaser's Pension Plans 
participate in said Master Trust for that period. 

(b)	The amounts so determined in Section 9.3(a)(i) shall be 
adjusted for investment earnings at the actual investment return 
of Textron's Master Trust for the period between the Closing Date 
and the date on which assets are transferred from the Textron 
Master Trust to a trust established by Purchaser to fund the 
Purchaser's Pension Plans, as described in the immediately 
preceding paragraph, which date shall not be later than the 
Cutoff Date, and reduced by the amount of any benefit payments to 
Employees during such period and a proportionate share of 
administrative expenses (including actual expenses of the paying 
agent) for such period if such administrative expenses are 
charged to the Seller's Pension Plans.

(c)	The assets caused to be transferred pursuant to Section 
9.3(a)(i) shall be calculated by Seller's actuary, and shall be 
subject to review by Purchaser's actuary for the sole purpose of 
determining that the calculation was made pursuant to this 
Section 9.3.  If there is any disagreement, Seller and Purchaser 
shall negotiate in good faith to determine the calculation of 
assets to be transferred.  If Seller and Purchaser are unable to 
reach an agreement within sixty (60) days after the Purchaser 
receives Seller's final calculations the dispute shall be 
resolved by a mutually acceptable third actuary whose fees and 
expenses shall be borne equally by the parties.

9.4	Defined Contribution Plan.   The accounts under the 
Textron Savings Plan of all Employees of the Business on the 
Closing Date shall be nonforfeitable on that date, and shall be 
distributable in accordance with the terms of that plan.  
Purchaser shall not assume any liability or have responsibility 
with respect to the Textron Savings Plan.

	9.5	Severance and Other Liability.  Seller shall retain and 
be solely liable for and shall indemnify and hold Purchaser 
harmless from and against all obligations, cost or expense 
related to the Employee Benefit Plans, except with respect to any 
liabilities under the Employee Benefit Plans expressly assumed by 
Purchaser.  Purchaser shall assume, discharge, pay and be solely 
liable for and shall indemnify and hold Seller harmless from and 
against all obligation, cost or expense for (i) any earned 
vacation, holiday pay or other fringe benefits relating to 
Employees and Former Employees whether or not reflected on the 
Closing Balance Sheet; (ii) any health, disability or life 
insurance coverage and any medical and dental benefits (including 
retiree medical and life insurance coverage) payable at any time 
to Employees and Former Employees; (iii) severance pay, 
termination indemnity pay, salary continuation, special bonuses 
or like compensation under Seller's plans, policies or 
arrangements, or under applicable law,  relating to Employees and 
Former Employees; and (iv) any other claim or liability arising 
out of the employment of the Employees and Former Employees.  

	9.6   Benefit Plans - Interim Plans and Services.   Seller 
agrees, as an accommodation to Purchaser, to continue to operate 
its medical, dental, life insurance and disability plans (the 
"Interim Plans") for the benefit of the Employees and Former 
Employees and to continue to provide to Purchaser's Pension Plans 
(either directly or through its vendors) the pension plan 
administrative services (the "Interim Services") which it 
provided to Seller's Pension Plan immediately before the Closing, 
during an interim period (the "Interim Period") commencing on the 
Closing Date and ending, in the case of the Interim Plans, on the 
earlier of a date specified by Purchaser or December 31, 1998, 
and in the case of the Interim Services, on the earlier of a date 
specified by Purchaser or the Cutoff Date. The parties agree that 
Purchaser is fully responsible for all liabilities and benefits 
which arise as a result of the operation of the Interim Plans and 
the performance of the Interim Services, and agrees to indemnify 
and hold harmless Seller from any liability resulting from such 
operation and performance. Therefore, it is the intent of the 
parties that the financial obligations of Seller under this 
Section shall be measured as of the Closing Date as if this 
continuation provision did not exist except as set forth in this 
Agreement. Further, this Section shall not be construed to impose 
upon Seller any liability or responsibility except as expressly 
set forth in this Agreement. Any Interim Plans operated by Seller 
shall be provided to all eligible Employees and Former Employees, 
and benefits under these plans shall be identical to the benefits 
afforded such individuals under the applicable Seller's plans 
immediately prior to the Closing Date except as may be required 
by law. Purchaser agrees to pay Seller, or if so determined by 
Seller, any administrative representative of Seller, the premium 
rates and other out of pocket amounts actually payable under or 
incurred under, or contributions made to the Interim Plans, or 
incurred for the Interim Services, plus any related third party 
administrative fees as well as any reasonable and necessary 
related expenses incurred by Seller.


	ARTICLE X
	Obligations After Closing

	10.1	Access.  In connection with any financial audit of 
Seller or any Tax audit or other governmental investigation of 
Seller for any matter relating to the business of Company for any 
period prior to the Closing, or for any other reasonable and 
lawful purpose, Purchaser shall cause Company, upon request, to 
permit Seller and its representatives to have access, at 
reasonable times during normal business hours and in a manner 
which is not disruptive to the operations of  Company, to the work 
papers, books and records of Company relating the conduct of its 
business prior to the Closing which shall have been in possession 
of Company as of the Closing and which remain in the possession of 
Company.  Purchaser shall cause Company not to dispose of such 
work papers, books and records during the six year period 
beginning with the Closing without Seller's consent.  Following 
the expiration of such six-year period, Company may dispose of 
such work papers, books and records at any time upon giving 90 
days' prior written notice to Seller, unless Seller agrees to take 
possession of such work papers, books and records within such 90 
days at no expense to Purchaser.

	10.2	Post-Closing Assistance.  For a period of up to 90 days 
following the Closing (or in the case of services described in 
Schedule 10.2, for the periods of time set forth in Schedule 
10.2), Seller shall provide to Company such support services 
currently provided by Seller to Company as Purchaser may 
reasonably request.   Purchaser shall fund or reimburse Seller for 
all out of pocket amounts incurred by Seller in providing such 
services.  Purchaser may cause Company to terminate the use of any 
service by not less than ten days prior written notice to Seller.  
At the Closing, Purchaser shall deposit with Seller the sum of 
$290,000 to fund the payments expected to be made by Seller on 
Purchaser's behalf in the month following the Closing.  On or 
before the fifth day of first calendar month after the Closing, 
Purchaser shall deposit with Seller the sum of $190,000.  On or 
before the fifth day of each subsequent calendar month, Purchaser 
shall deposit with Seller the amount which is needed to restore 
the total amount on deposit with Seller to $190,000.  This amount 
may be revised by mutual agreement of Purchaser and Seller at any 
time after the Closing to better represent the monthly out of 
pocket amount for support services then currently being provided.  
At the end of the last month in which Seller provides support 
services to Company pursuant to this provision, the unused balance 
of funds on deposit with Seller, less an estimate of any 
additional out of pocket amounts that Seller expects to incur on 
behalf of Company or Purchaser, shall be refunded, without 
interest, to Purchaser.   A final reconciliation shall be made 
within ninety days thereafter. Support services contemplated in 
this Section 10.2 include, but are not limited to, the items 
listed and described in Schedule 10.2.  

	10.3	Textron Name.  Purchaser shall not use, and Purchaser 
shall cause Company to cease using, the name, "Textron," as all or 
part of a trade name or otherwise in connection with Company's 
operations as soon as practicably possible after the Closing Date, 
except to the extent that the name "Textron" is embedded in a mold 
or die used by Company if the removal of the name "Textron" would 
result in unreasonable expense to Company.  Within three business 
days after the Closing Date, Purchaser shall cause Company to file 
an amendment to its Articles of Incorporation whereby "Textron" 
shall be deleted from its name.  Purchaser shall cause Company to 
cease, no later than September 30, 1998, to distribute any trade 
literature, brochures, bulletins, labels, or stationery or other 
similar materials (collectively, "Trade Materials") or products 
which have the name, "Textron," thereon without first overprinting 
or stickering or otherwise modifying the same to show Purchaser as 
the owner and source thereof.   Within thirty (30) business days 
after the Closing Date, Purchaser shall cause Company to reprogram 
its programmable laser parts marker so that the name, "Textron," 
is not imprinted in this manner on Company's products; provided, 
however, that if customer approval is required for such change, 
Company may continue to imprint the parts in this manner until 
such approval is obtained.  Purchaser shall cause Company 
diligently to pursue such approval.  Purchaser may until not later 
than June 30, 2003, permit Company to continue to sell products 
from Company's inventory which have been inscribed with Seller's 
name prior to the Closing and after the Closing pursuant to this 
Section 10.3.  Except as provided above, all use of the name, 
"Textron," by Purchaser or Company shall cease not later than 
September 30, 1998, and Purchaser shall cause Company to destroy 
all Trade Materials bearing the name "Textron" or change such 
Trade Materials to delete such identification before September 30, 
1998.

	10.4	Covenant Not to Compete.  

		(a)	During the period commencing on the Closing Date 
and ending on the third (3rd) anniversary of the Closing Date, 
Seller shall not, and shall cause all Affiliates of Seller not to, 
directly or indirectly conduct or engage in the business of 
designing, manufacturing or selling products or services 
competitive with products and services manufactured, produced or 
supplied by Company as of the Closing (the "Restricted Business") 
anywhere in the world.  

				(i)		Notwithstanding the foregoing, neither Seller nor any of its 
existing Affiliates or any future Affiliates, shall be in violation of this
Section 10.5(a) if (A) it continues to operate its existing businesses or 
(B) it owns less than 10% record or beneficial interest of the equity 
securities of any entity that is engaged in the Restricted 
Business; provided, that it shall not be deemed a breach of this 
Section 10.4(a) if Seller or any Affiliate (existing or future) 
acquires more than the 10% record or beneficial interest threshold 
in any entity whose revenues derived from the Restricted Business 
constitute less than 20% of the consolidated revenues of such 
entity for the most recently completed fiscal year.  In the event 
either Seller or any Affiliate exceeds the thresholds set forth 
above, it shall not be deemed a breach of this Section 10.4(a) if 
Seller or any such Affiliate promptly divests or discontinues, as 
the case may be (in any event within twenty-five (25) months from 
the date it exceeds the 10% ownership or 20% revenue threshold), 
that portion of its investment over the 10% ownership threshold or 
that portion of the Restricted Business which exceeds the 20% 
consolidated revenue limit of such entity.   

			(ii)	Notwithstanding Section 10.4(a)(i), if Seller 
or any of its existing Affiliates or any future Affiliates 
acquires 90% or more of the record or beneficial ownership 
interest in any entity (the "Acquired Entity") whose revenues 
derived from the Restricted Business constitute 20% or more of 
the consolidated revenues of the Acquired Entity for the most 
recently completed fiscal year prior to the date of such 
acquisition ("Seller's Acquisition"), Seller shall promptly after 
the date of Seller's Acquisition grant Purchaser an option to 
acquire the portion of such entity engaged in the Restricted 
Business (the "Restricted Portion") as provided in this Section 
10.4(a)(ii).   Such option may be exercised by Purchaser at any 
time during the twenty-fifth month after the date of Seller's 
Acquisition by written notice to Seller of such exercise; 
thereafter, such option shall lapse and be of no further force or 
effect.  The exercise price for such option shall be an amount 
equal to the aggregate purchase price, including liabilities 
assumed, paid by Seller or its Affiliate for its interest in the 
Acquired Entity multiplied by a fraction, the numerator of which 
shall be the net operating profit or other mutually acceptable 
measure of value of the Restricted Portion during the most 
recently completed fiscal year prior to the date of Seller's 
Acquisition and the denominator of which shall be the net 
operating profit or other mutually acceptable measure of value of 
the Acquired Entity during the same period.  The purchase by 
Purchaser of the Restricted Portion would be subject to the 
execution by Seller or its Affiliate and Purchaser of a mutually 
satisfactory definitive agreement for such purchase and the 
obtaining of all necessary governmental approvals and material 
third party consents (in each case at no out of pocket cost or 
expense to Seller), and to the expiration or termination of all 
applicable waiting periods (including any extensions thereof) 
required under the HSR Act, without the threat or initiation of 
legal action by the Federal Trade Commission or the Department of 
Justice.  Seller's representations in the definitive purchaser 
and sale agreement concerning the Restricted Portion would be 
limited to reasonable assurances that Seller had caused the 
Restricted Portion to be operated in the ordinary course of 


business during the period of Seller's ownership.  The definitive 
purchase and sale agreement and the transactions contemplated 
thereby could be terminated at the option of either Seller or its 
Affiliate, on the one hand, or Purchaser, on the other if such 
transactions were not consummated by the end of the thirtieth 
(30th) month following Seller's Acquisition.  If Purchaser does 
not exercise the option described in this Section 10.4(a)(ii) or 
if the sale of the Restricted Portion contemplated by hereby is 
not consummated other than because of Seller's default, Seller 
may retain ownership of the Acquired Entity, including the 
Restricted Portion, without further obligation to Purchaser 
hereunder, except as provided in Section 10.4(a)(iii).

				(iii)	At no time prior to June 30, 2008, shall 
Seller or any Affiliate of Seller use the "Textron" name as part 
of a trade name containing the words "Fuel Systems." 

		(b)	If a final judgment of a court or tribunal of 
competent jurisdiction determines that any term or provision 
contained in Section 10.4(a) is invalid or unenforceable, then the 
court or tribunal shall have the power to reduce the scope, 
duration, or geographic area of the term or provision, to delete 
specific words or phrases, or to replace any invalid or 
unenforceable term or provision with a term or provision that is 
valid and enforceable and that comes closest to expressing the 
intention of the invalid or unenforceable term or provision, and 
this Agreement shall be enforceable as so modified after the 
expiration of the time within which the judgment may be appealed.

		(c)	Seller recognizes, acknowledges and agrees that 
if Seller breaches any of the covenants, duties or obligations set 
forth in Section 10.4(a), Purchaser would encounter extreme 
difficulty in attempting to prove the actual amount of damages 
suffered by Purchaser as a result of such breach, and that 
Purchaser would not be reasonably or adequately compensated in 
damages in any action at law.  In addition to any other remedy 
Purchaser may have at law, in equity, by statute or otherwise, if 
Seller breaches any of the covenants, duties or obligations set 
forth in Section 10.4(a), Purchaser shall be entitled to seek and 
receive temporary, preliminary and permanent injunctive and other 
equitable relief from any governmental body of competent 
jurisdiction to enforce any of the rights of Purchaser under 
Section 10.4(a) or otherwise to prevent violation of any terms or 
provisions set forth in Section 10.4(a) without the necessity of 
proving the amount of any actual damage to Purchaser resulting 
therefrom; provided, however, that nothing contained in Section 
10.4(a) shall be deemed or construed in any manner whatsoever as a 
waiver by Purchaser of any of the rights that it may have against 
Seller at law, equity, by statute or otherwise arising out of, in 
connection with or resulting from the breach by Seller of any of 
their covenants, agreements, duties or obligations under this 
Agreement.

	10.5	Assumption of Employment Agreements.  Effective as of 
the Closing, Seller shall assign to Company and Company shall 
assume from Seller the employment agreements between Seller and 
the key employees of Company listed on Schedule 10.5; provided, 
however, that Seller shall retain liability for all payments under 
such employment agreements with respect to Textron Stock Options 
and Performance Share Units under any Long-Term Incentive Plan of 
Seller.

	10.6	Checks Presented and Payments Received.   Purchaser 
shall cause Company to establish new bank accounts as soon as 
practicable but in no event later than thirty (30) days after the 
Closing Date.  The Purchaser shall cause Company to be 
responsible for the payment of all checks drawn on accounts 
maintained by or for Company and presented for payment on and 
after the Closing Date and except as otherwise expressly provided 
herein, Company shall be entitled to retain or receive all 
payments received by or for the account of Company on and after 
the Closing Date.  Settlement of these items shall be made 
weekly.  As part of the settlement process, Seller shall provide 
copies of all applicable bank statements and records to 
Purchaser.

	10.7	Assumption of Responsibility for Certain Payments to 
AT&T Solutions, Inc. Effective as of the Closing, Company shall 
assume the obligations of Seller under the Technology Services 
and Management Agreement dated August 27, 1996, ("TSMA") between 
Seller and AT&T Solutions Inc. for the payment of any Divestiture 
Fee as described in Section 25.03 of the TSMA in connection with 
the transfer of ownership of Company to Purchaser and shall be 
responsible for paying AT&T for all services rendered to Company 
after the Closing. Further, should Company elect not to obtain 
technology services and management from AT&T similar to those in 
the TSMA, Purchaser shall cause Company to purchase the Assets 
defined in Section 27.02(e) of the TSMA and described in Schedule 
10.7, at their fair market value, determined as provided therein, 
as of the effective date of the decision not to obtain such 
services.

	10.8	Intercompany Receivables and Payables.  Effective as of 
the Closing, all intercompany receivables and payables between 
Seller and Company, other than for services and disbursements of 
the nature described in Schedule 10.2, shall be cancelled.

	10.9	Workers Compensation.  Purchaser shall indemnify Seller 
and hold Seller harmless from and against any obligation, cost, 
liability or expense Seller may incur in connection with Workers 
Compensation Claims filed against Company at any time by virtue 
of Seller's guaranty in any jurisdiction of the Workers 
Compensation obligations of Company.

	10.10	Further Assurances.  From time to time after the 
Closing, without further consideration, the parties shall 
cooperate with each other and shall execute and deliver 
instruments of transfer or assignment, or such other documents to 
the other party as such other party reasonably may request to 
evidence or perfect Purchaser's right, title and interest to the 
Share, and otherwise carry out the transactions contemplated by 
this Agreement.  Without limiting the generality of the foregoing, 
the Seller shall promptly after the closing cooperate with Company 
to transfer to the Company title to any intellectual property 
listed or required to be listed in Schedule 4.13 and the title to 
which is held by Seller or any Affiliate of Seller other than 
Company.


	ARTICLE XI
	Notices

	All notices, consents, approvals or other notifications 
required of the parties under this Agreement shall be in writing 
and shall be deemed properly served if delivered personally or 
sent by registered or certified mail (return receipt requested), 
facsimile or nationally-recognized courier or overnight delivery 
service addressed to such other party at the address set forth 
below, or at such other address as may hereafter be designated by 
either party in writing, and shall be deemed delivered (i) five 
business days after being sent by mail or (ii) when actually 
delivered if sent by facsimile, courier or overnight delivery 
service (or the next business day if delivered after regular 
business hours or on a Saturday, Sunday or holiday).

	(a)	If to Seller:	

Textron Inc.
40 Westminster Street
Providence, RI 02903
Attention:  Executive Vice President
	      and General Counsel
Facsimile:  (401) 457-3666

	
	(b)	If to Purchaser:

	Woodward Governor Company
5001 North Second Street
P. O. Box 7001
Rockford, IL 61125-7001
	Attention:  C. Phillip Turner and Robert Reuterfors
	Facsimile: (815) 877-9547 and (815) 639-6022
	and

	Baker & McKenzie
	130 East Randolph Drive
	Chicago, Illinois 60601
	Attention:  Philip F. Suse, Esq.
	Facsimile:  312/861-2899


	ARTICLE XII
	Announcements

	From and after the date hereof and through the Closing Date, 
Seller and Purchaser shall to the extent reasonably practicable 
consult with each other before issuing, or causing or permitting 
Company to issue, any press releases or otherwise making, or 
causing or permitting Company to make, any public statements with 
respect to this Agreement and the transactions contemplated 
hereby.  


	ARTICLE XIII
	Cooperation

	13.1	Cooperation by Purchaser.  In the event Seller is 
required to defend against, or desires to prosecute, any action, 
suit or proceeding arising out of a claim pertaining to the 
business or operations of Company prior to the Closing Date, 
Purchaser shall cause Company to provide such assistance and 
cooperation, including, witnesses and documentary or other 
evidence as may reasonably be requested by Seller in connection 
with its defense.  Seller  shall reimburse Purchaser and Company 
for their reasonable out-of-pocket expenses incurred in providing 
such assistance and cooperation. 

	13.2	Cooperation by Seller.  In the event Purchaser or 
Company are required to defend against, or desire to prosecute, 
any action, suit or proceeding arising out of a claim pertaining 
to the business or operations of Company or the Subsidiaries, 
Seller shall provide such assistance and cooperation, including, 
witnesses and documentary or other evidence, as may reasonably be 
requested by Purchaser in connection with such defense.  Purchaser 
shall reimburse Seller for its reasonable out-of-pocket expenses 
incurred in providing such assistance.


	ARTICLE XIV
	Indemnification

	14.1	Indemnification by Seller.  From and after the Closing, 
Seller shall indemnify and hold Purchaser and its Affiliates 
harmless against and in respect of (i) any Damages (as defined 
below) incurred or sustained by Purchaser or its Affiliates 
resulting from any breach by Seller of its covenants or agreements 
contained herein, including, Damages resulting from Seller's or 
Company's failure to pay Taxes pursuant to Section 15.2 hereof or 
the failure of the trustee for Seller's Pension Plan to make the 
transfer described in Section 9.3; (ii) any Damages incurred or 
sustained by Purchaser or its Affiliates in connection with 
environmental matters to the extent set forth in Article VIII of 
this Agreement; (iii) any Damages, liability, cost, expense, 
excise tax, penalty, or interest resulting from noncompliance by 
Seller's Pension Plans with the provisions of the Internal Revenue 
Code or ERISA, including any regulations thereunder, or any 
adverse determination by the IRS, DOL or PBGC with respect to 
Seller's Pension Plans; (iv) any Damages incurred or sustained by 


Purchaser or its Affiliates resulting from any breach of or 
inaccuracies in the representations and warranties of Seller set 
forth in Article IV; provided, however, that (w) Seller shall be 
required to indemnify Purchaser or its Affiliates pursuant to this 
clause (iv) for any such liabilities, breaches or inaccuracies 
only to the extent that the aggregate Damages to Purchaser or its 
Affiliates resulting from such liabilities, breaches or 
inaccuracies exceeds $300,000, (x) Seller shall not be required to 
indemnify Purchaser or its Affiliates pursuant to this clause (iv) 
in an aggregate amount in excess of $25,000,000; (y) Purchaser 
shall not make any claim against Seller pursuant to this clause 
(iv) which individually (or in the aggregate with respect to 
related claims) does not exceed $25,000 and such claims that do 
not meet this threshold shall not be applied against the basket 
amount set forth in clause (w) above, and (z) any claim for 
indemnification under this clause (iv) must be made in writing in 
reasonable detail to Seller by Purchaser not later than the 
expiration of the applicable survival period specified in Section 
16.12.  For purposes of this Agreement, and subject to Section 
14.3(g) herein, "Damages" shall mean any damages (including 
consequential damages), losses, costs, expenses, charges, 
settlements, judgments, liabilities or obligations (including, in 
the case of claims, charges, proceedings, suits or other actions 
brought by an unrelated third party (a "Third Party Claim"), and 
subject to Section 14.3(i) herein, reasonable attorneys' fees), 
imposed on, sustained, incurred or suffered by or asserted against 
an indemnified party under this Article XIV.  

	14.2	Indemnification by Purchaser.  From and after the 
Closing, Purchaser shall indemnify and hold Seller and its 
Affiliates harmless against and in respect of (i) all obligations 
and liabilities for post-retirement welfare benefits, as provided 
in Section 9.5; (ii) all obligations and liabilities in connection 
with Workers Compensation Claims filed against Company, as 
provided in Section 10.9;  (iii) any Damages incurred or sustained 
by Seller or its Affiliates resulting from any breach by Purchaser 
of its covenants or agreements contained herein, including, 
Damages resulting from Purchaser's or Company's failure to pay 
Taxes pursuant to Section 15.3 hereof; (iv) any Damages incurred 
or sustained by Seller or its Affiliates directly resulting from 
Company's use of the Textron name after the Closing, and (v) any 
Damages incurred or sustained by Seller or its Affiliates 
resulting from any breach of or inaccuracy in the representations 
and warranties of Purchaser contained in Article V hereof; 
provided that (w) Purchaser shall be required to indemnify Seller 
or its Affiliates pursuant to this clause (v) for any such 
breaches or inaccuracies only to the extent that the aggregate 
Damages resulting from such breaches or inaccuracies to Seller or 
its Affiliates exceeds $300,000, (x) Purchaser shall not be 
required to indemnify Seller or its Affiliates pursuant to this 
clause (v) in an aggregate amount in excess of $25,000,000 (y) 
Seller shall not make any claim against Purchaser which 
individually (or in the aggregate with respect to related claims) 
does not exceed $25,000, and such claims that do not meet this 
threshold shall not be applied against the basket amount set forth 
in clause (v) above, and (z) any claim for indemnification under 
this clause (v) must be made in writing in reasonable detail to 
Purchaser by Seller not later than the first anniversary of the 
Closing Date.

	14.3	Indemnification Procedures and Other Indemnification 
Matters.

		(a)	With respect to Third Party Claims, all claims for 
indemnification by Seller or Purchaser or their respective 
Affiliates, as the case may be (an "Indemnified Party"), hereunder 
shall be asserted and resolved as set forth in this Section 14.3.  
Promptly after receipt by an indemnified party under this Section 
14.3 of notice of any claim or the commencement of any action, the 
indemnified party shall, if a claim in respect thereof is to be 
made against Purchaser or Seller, as the case may be (an 
"Indemnifying Party") under this Section 14.3, notify the 
indemnifying party in writing of the claim or the commencement of 
that action, provided that the failure to notify the indemnifying 
party shall not relieve it from any liability which it may have to 
the indemnified party unless the indemnifying party is materially 
prejudiced in its ability to defend such action.   If any such 
claim shall be brought against an indemnified party, and it shall 
notify the indemnifying party thereof, the indemnifying party 
shall, unless the claim involves Taxes, which shall be governed by 
the provisions of Section 15.8, be entitled at its expense to 
participate therein, and to assume the defense thereof through 
counsel reasonably acceptable to the indemnified party and to 
settle and compromise any such claim or action, provided that (i) 
such indemnifying party acknowledges to the indemnified party in 
writing such indemnified party's right to indemnification with 
respect to such claim, (ii) no compromise or settlement of such 
claims may be effected by the indemnifying party without the 
indemnified party's consent unless (A) there is no finding or 
admission of any violation of law or any violation of the rights 
of any person and no effect on any other claim that may be made 
against the indemnified party, and (B) the sole relief provided is 
monetary damages that are paid in full by the indemnifying party.  
If notice is given to an indemnifying party of the commencement of 
any Third Party Claim and the indemnifying party does not, within 
thirty days after the indemnified party's notice is given, give 
notice to the indemnified party of its election to assume the 
defense of such Third Party Claim, the indemnifying party will be 
bound by any determination made in such Third Party Claim or any 
compromise or settlement effected by the indemnified party.  
Notwithstanding the foregoing, if an indemnified party determines 
that there is a reasonable probability that a Third Party Claim 
may adversely affect it or its Affiliates other than as a result 
of monetary damages for which it would be entitled to 
indemnification under this Agreement, the indemnified party may, 
by notice to the indemnifying party, assume the exclusive right to 
defend, compromise, or settle such Third Party Claim, and the 
indemnifying party will not be bound by any determination of a 
Third Party Claim so defended or any compromise or settlement 
effected without its consent and the indemnifying party shall have 
no further obligation to indemnify the indemnified party with 
respect to such Third Party Claim.  After notice from the 
indemnifying party to the indemnified party of its election to 
assume the defense of such claim or action and its agreement to 
indemnify the indemnified party with respect to such Third Party 
Claim, the indemnifying party shall not be liable to the 
indemnified party for any legal or other expenses subsequently 
incurred by the indemnified party in connection with the defense 
thereof.  No indemnifying party who has assumed the defense of any 
claim or action shall be liable for any settlement or compromise 
of such claim or action effected without its written consent, 
which consent shall not be unreasonably withheld.  Purchaser and 
Seller shall each render to each other such assistance as may 
reasonably be requested in order to ensure the proper and adequate 
defense of any such claim or proceeding.

 		(b)	The indemnities provided in this Agreement shall 
survive the Closing.  The indemnity provided in this Article XIV 
shall be the sole and exclusive contractual remedy for damages of 
the indemnified party against the indemnifying party at law or 
equity for any matter covered by this Agreement following the 
Closing.

		(c)	If the amount with respect to which any claim is 
made under any of Sections 14.1 or 14.2 of this Agreement (an 
"Indemnity Claim") gives rise to a currently realizable Tax 
Benefit (as defined below) to the party making the claim, the 
indemnity payment shall be reduced by the amount of the Tax 
Benefit available to the party making the claim.  To the extent 
such Indemnity Claim does not give rise to a currently realizable 
Tax Benefit, if the amount with respect to which any Indemnity 
Claim is made gives rise to a subsequently realized Tax Benefit to 
the party that made the claim, such party shall refund to the 
indemnifying party the amount of such Tax Benefit when, as and if 
realized.  For the purposes of this Agreement, any subsequently 
realized Tax Benefit shall be treated as though it were a 
reduction in the amount of the initial Indemnity Claim, and the 
liabilities of the parties shall be redetermined as though both 
occurred at or prior to the time of the indemnity payment.  For 
purposes of this Section 14.3(c), a "Tax Benefit" means an amount 
by which the Tax liability of the party (or group of corporations 
including the party) is reduced (including, by deduction, 
reduction of income by virtue of increased Tax basis or otherwise, 
entitlement to refund, credit or otherwise) plus any related 
interest received from the relevant Taxing authority.  Where a 
party has other losses, deductions, credits or items available to 
it, the Tax Benefit from any losses, deductions, credits or items 
relating to the Indemnity Claims shall be deemed to be realized 
only after the utilization of such other losses, deductions, 
credits or items.  For the purposes of this Section 14.3(c), a Tax 
Benefit is "currently realizable" to the extent it can be 
reasonably anticipated that such Tax Benefit shall be realized in 
the current Taxable period or year or in any Tax Return with 
respect thereto (including through a carryback to a prior Taxable 
period) or in any Taxable period or year prior to the date of the 
Indemnity Claim.  In the event that there should be a 
determination disallowing the Tax Benefit, the indemnifying party 
shall be liable to refund to the indemnified party the amount of 
any related reduction previously allowed or payments previously 
made to the indemnifying party pursuant to this Section 14.3(c).  
The amount of the refunded reduction or payment shall be deemed a 
payment under Sections 14.1 and 14.2 of this Agreement and thus 
shall be paid subject to any applicable reductions under this 
Section 14.3(c).

		(d)	The parties agree that any indemnification 
payments made, and/or any payments (or adjustments) made with 
respect to a Tax Benefit, pursuant to this Agreement shall be 
treated for all Tax purposes as an adjustment to the Purchase 
Price, unless otherwise required by applicable law, in which event 
payments shall be made in an amount sufficient to indemnify the 
party on a net after-Tax basis.
 
		(e)	Each party and their Affiliates shall be obligated 
in connection with any claim for indemnification under this 
Article XIV to use all commercially reasonable efforts to obtain 
any insurance proceeds available to such indemnitee with regard to 
the applicable claims. The amount which the indemnifying party is 


or may be required to pay to any indemnified party pursuant to 
this Article XIV shall be reduced (retroactively, if necessary) by 
any insurance proceeds or other amounts actually recovered by or 
on behalf of such indemnified party in reduction of the related 
Damages.  If an indemnified party shall have received the payment 
required by this Agreement from an indemnifying party in respect 
of Damages and shall subsequently receive insurance proceeds or 
other amounts in respect of such Damages, then such indemnified 
party shall promptly repay to the indemnifying party a sum equal 
to the amount of such insurance proceeds or other amounts actually 
received.

		(f)	Each indemnified party shall be obligated in 
connection with any claim for indemnification under this Article 
XIV to use all commercially reasonable efforts to mitigate Damages 
upon and after becoming aware of any event which could reasonably 
be expected to give rise to such Damages.

		(g)	Notwithstanding anything to the contrary contained 
herein, neither Seller nor any of its Affiliates shall be liable 
to Purchaser or any of its Affiliates, including Company, nor 
shall Purchaser or any of its Affiliates be liable to Seller or 
any of its Affiliates, pursuant to any provision of this 
Agreement, any of the agreements contemplated hereby, or 
otherwise, for any punitive damages; and Purchaser and Seller 
each hereby waives its right and that of its respective 
Affiliates to assert any such punitive damages with respect to 
any claim, action, charge, suit or proceeding arising out of or 
in connection with the any of the transactions contemplated by 
this Agreement.


	ARTICLE XV
	Tax Matters

	15.1	Tax Sharing.  On the Closing Date, all Tax sharing 
agreements and arrangements between Company, on the one hand, and 
Seller or any Affiliate of Seller other than Company, on the other 
(copies of which have been attached to Schedule 15.1), shall be 
terminated, all liabilities shall be extinguished or deemed 
satisfied and no additional payments shall be made thereunder.

	15.2	Payments:  Seller's Responsibility. 

		(a)	Seller shall pay or cause to be paid (without 
duplication of amounts otherwise payable, and excluding any 
interest, penalties and additions to Tax arising solely from any 
act or omission after the Closing Date by Purchaser or Company if 
such act or omission was not caused by an act or omission of 
Seller or any Affiliate of Seller other than Company) the 
following Taxes attributable to periods ending on or before the 
Closing Date and the portion of any period up to the Closing Date 
that includes (but does not end on) such day ("Pre-Closing Tax 
Periods"):  (i) all federal Income Taxes payable with respect to 


which  Company has filed or is required to file pursuant to 
Section 15.4 a federal Income Tax Return whether separately or as 
part of a consolidated federal Income Tax Return, (ii) all state, 
local and foreign Income Taxes with respect to which Company has 
filed or is required to file pursuant to Section 15.4 a state, 
local or foreign Income Tax Return whether separately or as part 
of a combined, consolidated, unitary or similar Return payable 
with respect to Company, (iii) all Taxes other than Income Taxes 
for which Company may be held liable, and (iv) all Taxes for which 
Company may be held liable as a member of Seller's Group (as 
defined in Section 15.12(d)) pursuant to Treasury Regulations 
Section 1.1502-6(a) or as a member of any combined, consolidated, 
unitary or similar group of which Seller or any Affiliate of 
Seller other than Company is or was a member pursuant to any 
similar provision of any state, local or foreign law with respect 
to Income Taxes.  

		(b)	With respect to Taxes attributable to Pre-Closing 
Tax Periods that do not end on the Closing Date, the amount of 
Taxes of Company attributable to the portion of such period up to 
the Closing Date shall be determined as follows:  (i) in the case 
of Taxes other than Income Taxes, the amount of such Taxes 
incurred during the entire taxable period that includes the 
Pre-Closing Tax Period shall be multiplied by a fraction, the 
numerator of which is the number of days in such period up to the 
Closing Date and the denominator of which is the total number of 
days in such period; and (ii) in the case of Income Taxes, the 
amount of such Taxes shall be computed as if such taxable period 
ended as of the close of business on the Closing Date.  The 
obligation of Seller in respect of the Taxes described in clauses 
(i) and (ii) above shall be effected by the payment to Purchaser 
of the excess of (A) the amount of such Taxes attributable to the 
portion of the period up to the Closing Date over (B) the sum of 
(x) the amount of such Taxes paid by Seller or Company on or prior 
to the Closing Date and (y) the cumulative reserve and/or 
liabilities for Taxes on the Balance Sheet.  If the sum set forth 
in clause (B) in the immediately preceding sentence exceeds the 
amount of Taxes described in clause (A) of such sentence,  
Purchaser shall pay to Seller the amount of such excess.

	15.3	Payments:  Purchaser's Responsibility.  Purchaser shall 
pay or cause to be paid all Taxes payable with respect to Company 
that are not described as being the responsibility of Seller in 
Section 15.2.

	15.4	Returns:  Seller's Responsibility.  Seller and 
Purchaser shall cause Company, to the extent permitted by law, to 
join, for all taxable periods ending on or prior to the Closing 
Date, in (a) the consolidated federal Income Tax Returns of 
Seller's Group and (b) the combined, consolidated, unitary or 
similar Returns for state, local and foreign Income Taxes with 
respect to which Company (i) filed such a Return for the most 
recent taxable period for which a Return has been filed prior to 
the Closing Date and may file such a Return for subsequent taxable 
periods or (ii) is required to file such a Return by the 
applicable taxing authority.  The income, deductions and credits 
of Company for periods on or prior to the Closing Date shall be 
included in the consolidated federal Income Tax Returns of 
Seller's Group and in such combined, consolidated, unitary or 
similar Returns where applicable.  Seller shall file, or cause to 


be filed, all other Returns including any separate Income Tax 
Returns, relating to the business or assets of Company required to 
be filed on or before the Closing Date.  All Returns described in 
this Section 15.4 shall be prepared on a basis consistent with 
those prepared for prior taxable periods.

	15.5	Returns:  Purchaser's Responsibility.  Purchaser shall 
file, or cause to be filed, all Returns relating to the business 
or assets of Company other than those Returns described in Section 
15.4 (including, any federal Income Tax Return filed by the 
consolidated group of which Purchaser is a member with respect to 
any taxable period ending after the Closing Date). The income, 
deductions and credits of Company, other than those required to be 
included in the Returns described in Section 15.4, shall be 
included in the Returns described in the immediately preceding 
sentence, including, (a) items for periods ending on or prior to 
the Closing Date with respect to state, local and foreign Income 
Taxes that are not required to be included in combined, 
consolidated, unitary or similar Returns or in Returns required to 
be filed on or before the Closing Date pursuant to Section 15.4 
and (b) all items for periods after the Closing Date.  Any such 
Returns for which Purchaser is responsible shall, insofar as they 
relate to items for periods ending on or prior to the Closing Date 
and to the extent permitted by applicable Tax law, be on a basis 
consistent with the last previous such Returns filed in respect of 
Company, provided that Purchaser shall not be required to take any 
position for which Purchaser provides Seller with a written 
opinion of tax counsel, reasonably acceptable to Seller, that 
there is no substantial authority for such position, within the 
meaning of Treasury Regulations Section 1.6662-4(d) .  Purchaser 
shall pay all fees and expenses of such tax counsel.  
Notwithstanding anything to the contrary in this Section 15.5, 
Seller and Purchaser agree that, where permitted by law, they 
shall treat (or elect to treat) the Closing Date as the end of a 
Tax Period or, if not so permitted, Seller and Purchaser agree 
that the Closing Date shall be deemed the end of the Tax Period.  
For purposes of Sections 15.5 and 15.2, the amount of income 
attributable to the portion of 1998 that ends or is deemed to end 
on the Closing Date and the portion after the Closing Date shall 
be determined on the basis of a closing of the books of Company.  
If the portion of the income attributable to the portion of 1998 
that ends or is deemed to end on the Closing Date and the portion 
after the Closing Date cannot be determined from the books of 
Company, the income shall be allocated in accordance with Treasury 
Regulations Section 1.1502-76(b).

	15.6	Cooperation.  Purchaser and Seller shall cooperate, and 
Purchaser shall cause Company to cooperate with Seller, with 
respect to the preparation and filing of any Return for which the 
other is responsible pursuant to Sections 15.4 and 15.5 
(including, providing work papers and schedules); provided, 
however that the party requesting assistance shall pay the out-of-
pocket costs and expenses of the party providing such assistance, 
and further, such assistance and cooperation shall not 
unreasonably interfere with the operations and business of the 
party providing such assistance. Purchaser shall prepare or cause 
Company to prepare, not later than five months following the date 
of Closing and in a manner  consistent with the past practice of 
Company, the tax work paper preparation package or packages 
necessary to enable Seller to prepare consolidated federal and 
combined, consolidated and unitary state and local Income Tax 
Returns for the period or periods from January 1, 1998 through the 
Closing Date.

	15.7	Refunds.  

		(a)	Seller shall be entitled to retain, or receive 
immediate payment from Purchaser or Company, and Purchaser shall 
cause Company to pay over to Seller any refund or credit with 
respect to Taxes (including, refunds and credits arising by reason 
of amended Returns filed after the Closing Date), plus any 
interest received with respect thereto from the applicable taxing 
authorities, relating to Company that are described as being the 
responsibility of Seller in Section 15.2, provided that none of 
Seller or Affiliates other than Company shall file an amended 
Return that would increase the Taxes that are described as being 
the responsibility of Purchaser in Section 15.3 unless required to 
do so by a taxing authority. 

		(b)	Purchaser shall cooperate, and shall cause Company 
to cooperate, with Seller, with respect to claiming any refund or 
credit with respect to Taxes referred to in this Section 15.7.  
Such cooperation shall include providing Seller with all relevant 
information available to Purchaser  (through Company or otherwise, 
as the case may be), with respect to any such claim; filing and 
diligently pursuing such claim (including by litigation, if 
appropriate); paying over to Seller  in accordance with this 
provision, any amount received by Purchaser (or Company), as the 
case may be, with respect to such claim; and, in the case of 
Purchaser or Company filing such a claim, consulting with Seller 
prior to agreeing to any disposition of such claim, provided that 
the foregoing shall be done at Seller's expense and in a manner so 
as not to interfere unreasonably with the conduct of the business 
of the parties.



	15.8	Audits and Contests.  

		(a)	With respect to any issue that may affect the 
Taxes of Company for taxable periods ending on or prior to the 
Closing Date, each of Purchaser and Seller shall promptly notify 
the other in writing within ten Business Days from its receipt of 
notice of (i) any pending Tax audits or assessments of Company, 
and (ii) any pending Tax audits or assessments of Purchaser or 
Seller, or any of the Affiliates thereof.

		(b)	Seller shall have the right to represent the 
interests of Company in any Tax audit or administrative or court 
proceeding to the extent relating to Taxes that are described as 
being the responsibility of Seller in Section 15.2, and to employ 
counsel of its choice at its expense, provided that Seller shall 
give prompt notice to Purchaser, keep Purchaser reasonably 
informed and consult with Purchaser with respect to any issue 
relating to such audit or proceeding that could have a material 
adverse effect on Purchaser.  Purchaser shall have the right to 
represent the interests of Company in any Tax audit or 
administrative or court proceeding not described in the 
immediately preceding sentence and to employ counsel of its choice 
at its expense, provided that Purchaser shall give prompt notice 
to Seller, keep Seller reasonably informed and consult with Seller 
with respect to any issue relating to such audit or proceeding 
that could have a material adverse effect on Seller.  Purchaser 
and Seller shall cooperate, and Purchaser shall cause Company to 
cooperate with Seller, with respect to any Tax audit or 
administrative or court proceeding relating to Taxes referred to 
in this Section 15.8.  Such cooperation shall include providing 
all relevant information available to Seller or Purchaser (through 
Company or otherwise), as the case may be, with respect to any 
such audit or proceeding and making personnel available at and for 
reasonable times, including, to prepare responses to requests for 
information, provided that the foregoing shall be done in a manner 
so as not to interfere unreasonably with the conduct of the 
business of the parties; and provided further, that the party 
requesting said assistance shall pay any out-of-pocket costs and 
expenses incurred by the party providing such assistance.

		(c)	Seller may not enter into on behalf of Company or 
Purchaser a settlement agreement with respect to any asserted Tax 
liability without the written consent of Purchaser, which consent 
shall not be unreasonably withheld.  If Seller elects not to 
exercise its right described in the first sentence of Section 
15.8(b), fails to notify Purchaser of such exercise, or contests 
its obligation vis--vis Company and Purchaser to make payments 
with respect to any asserted Tax liability that is the 
responsibility of Seller under Section 15.2, then Company or 
Purchaser may pay, compromise, or contest such asserted Tax 
liability.  The expenses of settlement, compromise or contest of 
such asserted Tax liability shall be borne by the party that is 
ultimately determined to be responsible for such Tax liability.  
Purchaser's or Company's settlement, compromise, or contest of 
such asserted Tax liability shall not affect Seller's obligations 
under Section 15.2 and Section 14.  In any event, each of 
Purchaser, Seller, and Company may participate at its own expense 
in the contest of such asserted Tax liability.

	15.9	Conduct of Business.  Notwithstanding any other 
provision of this Agreement, Purchaser shall be responsible for, 
and neither Seller nor any of its Affiliates other than Company 
shall bear, any Taxes that arise due to the failure, following the 
Closing, of Purchaser to cause Company to carry on its business on 
and after the Closing Date only in the ordinary course and in 
substantially the same manner as heretofore conducted .

	15.10	Transaction Related Taxes.  Purchaser shall be 
responsible for any Taxes that relate to the purchase and sale of 
the Stock pursuant to this Agreement, other than  Income Taxes 
resulting directly from such sale, which shall be borne by Seller 
except as set forth in Section 15.11 hereof.

	15.11	Section 338 Election.

		(a)	Purchaser shall have the right, at Purchaser's 
option, to have a joint  election under Code Section 338(h)(10) 
made with respect to the sale and purchase of the Share pursuant 
to this Agreement, provided that Purchaser notifies Seller prior 
to September 1, 1998, of Purchaser's intention to exercise such 
right; otherwise, Purchaser shall be deemed to have waived such 
right.  If Purchaser notifies Seller that Purchaser shall 
exercise this right, then Purchaser and Seller shall jointly make 
a Code Section 338(h)(10) election with respect to the sale and 
purchase of the Share, including any elections under analogous 
provisions under state law.  All such elections shall be filed by 
Purchaser and Seller within a reasonable time period in 
accordance with the applicable regulations under the Code, but in 
no event later than the 15th day of the 9th month beginning after 
the month in which occurs the Closing Date.  In connection with 
such an election, Purchaser shall complete, and Purchaser and 
Seller shall jointly cause to be filed with the IRS, Form 8023 
(including related schedules).

		(b)	Purchaser shall have the right to allocate the 
Purchase Price to the assets of Company, which allocation shall 
be made in accordance with the requirements of the Code, 
applicable regulations under the Code and case law.  Purchaser 
and Seller shall be bound by such allocation for all purposes, 
including, the preparation of all federal, state, and local Tax 
Returns. Purchaser and Seller shall, and shall cause their 
respective Affiliates to, prepare and file all Returns (as defined 
in Section 15.12(b)) in a manner that reflects the amount of the 
Purchase Price allocated to each of Company's assets in accordance 
with such allocation, and to take no Tax Return or other position 
contrary thereto unless required to do so pursuant to a final 
determination by the Appeals Office of the IRS or similar 
appellate authority of any other Taxing authority; provided that 
if so required Purchaser or Seller, as the case may be, shall only 
take such contrary position for purposes of the Taxing authority 
requiring such contrary position, which, for purposes of this 
Section 15.11(b) includes any other Taxing authority which as a 
matter of law requires an adjustment to Taxes solely as a result 
of such final determination. Purchaser shall indemnify Seller for 
any interest and penalties imposed on Seller as a result of such 
allocation.  Seller shall take no action that would prevent 
Seller from filing a consolidated federal Income Tax Return in 
the year that includes the Closing Date, or take any action that 
would prevent Purchaser and Seller from filing a valid Code 


Section 338(h)(10) election.  Seller agrees to take such other 
procedural actions, at Purchaser's expense, as Purchaser may 
reasonably request to facilitate compliance with Code Section 338 
and the regulations thereunder or otherwise to obtain a Tax basis 
in the assets of Company that reflects the Purchase Price for Tax 
purposes, provided that Purchaser shall give Seller reasonable 
notice of the action to be taken and shall specify the date by 
which such action is required to be taken.

		(c)	If an election under Code Section 338(h)(10) (or 
any elections under analogous state law provisions) is made 
pursuant to this Section 15.11, then Purchaser shall pay to 
Seller an amount equal to the Tax Detriment (as hereinafter 
defined) within ten (10) days after Purchaser's notification to 
Seller pursuant to Section 15.11(a) of the exercise of 
Purchaser's right to have such election made, but in no event 
later than September 15, 1998.  "Tax Detriment" is the amount 
determined in a manner identical to the method described in 
Schedule 15.11.  Seller shall, and shall cause Company to, 
provide Purchaser with access to all books, records, and other 
information (including, all information relating to Seller's tax 
basis in the Share and Company's tax basis in its assets) 
necessary to compute the Tax Detriment.  Notwithstanding any 
other provision in this Section 15.11(c) or elsewhere in this 
Agreement (including Schedule 15.11), Purchaser's payment 
obligation with respect to the Tax Detriment shall not exceed 
Thirteen Million Five Hundred Thousand Dollars ($13,500,000).

	(d)  If Purchaser notifies Seller of its intent to exercise 
the option provided in Section 15.11(a) but fails to make payment 
to Seller of an amount equal to the Tax Detriment on or before 
September 15, 1998, in addition to such payment, Purchaser shall 
pay to Seller interest on the amount of such payment at the rate 
of six percent (6%) per annum from September 15, 1998 through and 
including the date of payment.  

	15.12	Certain Definitions.  For the purposes of this 
Agreement, the following terms shall be defined as follows:

		(a)	Income Tax.  "Income Tax" means any Tax computed 
in whole or in part by reference to net income (including all 
interest and penalties thereon and additions thereto).

		(b)	Return.  "Return" means any federal, state, local 
or foreign Tax return, report, declaration or form relating to the 
business or assets of Company, including any attachments, exhibits 
or other materials submitted with any of the foregoing and 
including any amendments or supplements to any of the foregoing.

		(c)	Tax.  "Tax" means any federal, state, local, 
foreign and other income, profits, franchise, capital, 
withholding, unemployment insurance, social security, 
occupational, production, severance, gross receipts, value added, 
sales, use, excise, real and personal property, ad valorem, 
occupancy, stamp, transfer, employment, disability, workers' 
compensation or other similar tax, duty or other governmental 
charge (including all interest and penalties thereon and additions 
thereto).

		(d)	Seller's Group.  "Seller's Group" means the group 
of companies, including Company, which have filed, or are required 
to file a consolidated federal Income Tax Return, of which Seller 
is a member.

	15.13	Tax Dispute Resolution Mechanism.  In case of any 
dispute with respect to matters set forth in this Article XV, such 
dispute shall be resolved as follows:  (a) either party shall 
provide a "Notice of Dispute" to the other party setting forth in 
reasonable detail the issue to be resolved pursuant to this 
Section 15.13; (b) the parties shall in good faith attempt to 
negotiate a settlement of the dispute; (c) if the parties are 
unable to negotiate a resolution of the dispute within 30 Business 
Days from the receipt of a Notice of Dispute, the dispute shall be 
submitted to KPMG Peat Marwick or other independent accountants of 
nationally recognized standing reasonably satisfactory to Seller 
and Purchaser to be chosen within 15 Business Days after 
notification from KPMG Peat Marwick that they are unwilling or 
unable to serve (the "Tax Dispute Accountants"); (d) the parties 
shall present their arguments to the Tax Dispute Accountants 
within 15 Business Days after submission of the dispute to the Tax 
Dispute Accountants; (e) the Tax Dispute Accountants shall resolve 
the dispute, in a fair and equitable manner and in accordance with 
the applicable Tax law, within 30 Business Days after the parties 
have presented their arguments to the Tax Dispute Accountants, 
whose decision shall be final, conclusive and binding on the 
parties; and (f) any payment to be made as a result of the 
resolution of a dispute shall be made, and any other action to be 
taken as a result of the resolution of a dispute shall be taken, 
on or before the later of (i) the date on which such payment or 
action would otherwise be required, or (ii) the third business day 
following the date on which the dispute is resolved (in the case 
of a dispute resolved by the Tax Dispute Accountants, such date 
being the date on which the parties receive written notice from 
the Tax Dispute Accountants of their resolution). The fees and 
expenses of the Tax Dispute Accountants in resolving a dispute 
shall be borne by the party against whom the Tax Dispute 
Accountants resolve the dispute .

	15.14	Survival of Article XV Covenants.  Anything herein to 
the contrary notwithstanding, the covenants contained in this 
Article XV shall survive the Closing for the applicable statutes 
of limitations.


	ARTICLE XVI
	Miscellaneous

	16.1	Broker Compensation.  Each of the parties hereto agrees 
to indemnify the other against and hold the other harmless from 
any and all liabilities (including, cost of counsel fees in 
defending against such liabilities) for brokerage commissions or 
finder's fees in connection with the transactions contemplated by 
this Agreement, insofar as such claims shall be based on 
arrangements or agreements made or claimed to have been made prior 
to the Closing by or on behalf of Seller or the Company, on the 
one hand, or Purchaser, on the other.  

	16.2	Expenses.  Each of the parties hereto shall pay its own 
expenses in connection with the negotiation and preparation of 
this Agreement and the Related Documents.

	16.3	Binding Agreement.  This Agreement shall be binding 
upon and inure to the benefit of the parties hereto and their 
respective successors and assigns, provided that neither party 
shall assign this Agreement without the prior written consent of 
the other party hereto, and in no event shall any assignment 
relieve the assigning party of its obligations hereunder.

	16.4	Entire Agreement.  This Agreement (including the 
Exhibits and Schedules hereto) (a) constitute the entire agreement 
between the parties hereto with respect to the purchase and sale 
of the Share and the other transactions contemplated hereby, (b) 
supersede all prior negotiations and oral or written 
understandings, if any, and (c) may not be amended or supplemented 
except by an instrument in writing signed by both parties hereto.  
Neither party makes any representation or warranty except as 
provided herein.

	16.5	Governing Law.  This Agreement shall be governed by and 
construed in accordance with the substantive laws of the State of 
Michigan.

	16.6	No Rights of Third Parties.  Nothing in this Agreement 
is intended to confer any right on any person other than the 
parties to it and their respective successors and assigns; nor is 
anything in this Agreement intended to modify or discharge the 
obligation or liability of any third person to any party to this 
Agreement, nor shall any provision give any third person any right 
of subrogation or action over against any party to this Agreement.

	16.7	Informal Dispute Resolution.  If any controversy or 
claim arising out of or relating to this Agreement (other than 
controversies or claims for which a dispute mechanism is 
specifically provided) or any event under Section 16.10 permitting 
termination of this Agreement occurs (the "Controversy"), Seller 
and Purchaser shall first attempt in good faith to have the 
Controversy discussed by senior executives of the parties.  The 
disputing party shall give the other party written notice (the 
"Notice") of the Controversy.  Within 30 calendar days from the 
date of receipt of the Notice, the receiving party shall submit to 
the disputing party its written response (the "Response").  The 
Notice and the Response shall include:  (a) a statement in 
reasonable detail of such party's position and (b) the name and 
title of the senior executive who shall represent that party.  
Promptly after receipt of the Response (but in no event later than 
30 calendar days from the date of receipt of the Response), the 
senior executives shall meet, along with a legal representative if 
desired, at a mutually acceptable time and place, or by telephone, 
to exchange relevant information and to discuss in good faith a 
resolution of the Controversy.  Neither party shall commence a 
legal action with respect to the Controversy until the 


above-mentioned time periods have elapsed and the meeting of the 
senior executives shall have taken place, except for legal actions 
seeking immediate injunctive relief.

	16.8	Counterparts.  This Agreement may be executed 
simultaneously in two or more counterparts, each of which shall be 
deemed as an original, but all of which together shall constitute 
one and the same instrument.

	16.9	Headings; Table of Contents; Construction.  The 
headings of the sections of this Agreement and the table of 
contents at the forepart of this Agreement are inserted for 
convenience only and shall not constitute a part hereof nor affect 
the rights of the parties hereto.  Unless otherwise expressly 
provided, the word "including" does not limit the preceding words 
or terms and shall mean "including but not limited to" and 
"including without limitation."

	16.10	Termination.  This Agreement may be terminated and 
abandoned at any time prior to the Closing Date (a) by mutual 
consent of both Seller and Purchaser; (b) by either Seller or 
Purchaser, if (i) the Closing has not occurred on or before June 
30, 1998, or such later date, if any, as Seller and Purchaser 
shall agree upon in writing, provided that the right to terminate 
this Agreement shall not be available to any party whose failure 
to fulfill any obligation under this Agreement has resulted in the 
failure of the Closing to occur on or before such date or (ii) any 
court or other governmental entity of competent jurisdiction shall 
have issued an order, decree, writ or ruling or taken any other 
action (which order, decree, writ, ruling or other action the 
parties hereto shall use their respective reasonable efforts to 
vacate) in each case permanently restraining, enjoining or 
otherwise prohibiting or materially restricting the transactions 
contemplated hereby and such order, decree, writ, ruling or other 
action shall have become final and nonappealable; or (c) by either 
Seller or Purchaser, if there has been a material default, 
misrepresentation or breach on the part of the other party in its 
representations and warranties set forth herein or the due and 
timely performance of any of its covenant and agreements contained 
herein.  If this Agreement is terminated pursuant to this Section 
16.10, all further obligations of the parties hereunder shall 
terminate, provided that the obligations set forth in this Section 
16.10 shall survive and each party shall retain any rights it may 
have against the other as a result of the other party's failure to 
comply with any other provision of this Agreement prior to such 
termination.

	16.11	Meaning of "Seller's Knowledge".  For purposes of this 
Agreement the phrase "to Seller's Knowledge" shall mean, and be 
limited to, the actual knowledge of Mike Boston, Jeffrey B. Hurst, 
James M. Kelley, Kenneth H. Loeffler, William R. Neely, Debra L. 
Paradis, Alvin Dan Toelle, Percy D. Welch, Joseph J. Palmer and 
Michael Victor at Company and Herbert L. Henkel, Carl D. Burtner, 
John H. Bracken, Robert C. Brayley, John R. Curran, Robert F. 
Grenhart and Henry J. Policare at Seller.	

	16.12	Survival of Representations and Warranties.  The 
representations and warranties of Seller contained in this 
Agreement shall survive the Closing for a period of twenty-one 
(21) months; provided, however, that the representations and 
warranties set forth in Section 4.15 relating to Environmental 
Matters shall survive for a period of five (5) years, the 
representations and warranties set forth in Section 4.21 relating 
to Product Warranties shall survive for a period of twelve (12) 
months, the representations and warranties set forth in Section 
4.16 relating to Tax Returns and Payments shall survive for the 
period of the applicable statute of limitations, and the 
representations and warranties set forth in Section 4.3 relating 
to Ownership of Share shall survive indefinitely.



	IN WITNESS WHEREOF, the parties hereto have caused this 
Agreement to be duly executed as of the day and year first above 
written.

ATTEST:			                  TEXTRON INC.

Ann T. Willaman		           By: Herbert J. Henkel
						


                        				WOODWARD GOVERNOR COMPANY
ATTEST:

Carol J. Manning		          By: C. Phillp Turner



						Exhibit A

	June 15, 1998


Woodward Governor Company
5001 North Second Street
Rockford, IL 61125

Ladies and Gentlemen:

I am Corporate Counsel of Textron Inc., a Delaware corporation 
("Textron"), and have acted in such capacity in connection with 
the Purchase and Sale Agreement dated as of May 29, 1998, (the 
"Purchase Agreement") between Textron and Woodward Governor 
Company, a Delaware corporation ("Purchaser"), and the 
transactions contemplated thereby.  This opinion is being 
delivered pursuant to Section 6.3 of the Purchase Agreement.  
Capitalized terms which are used and not otherwise defined herein 
shall have the same meaning given to them in the Purchase 
Agreement.

In connection with this opinion, I have examined:

(a) copies, certified by the Secretary of the State of 
Delaware as of a recent date, of the Restated 
Certificate of Incorporation of Textron and the 
Certificate of Incorporation, as amended, of Fuel 
Systems Textron Inc. ("Company"), formerly known as "TX 
Financing Corporation 6"; 
 
(b) certificates of recent date of the Secretary of 
State of Delaware as to the good standing of Textron 
and the Company and of the Secretaries of State of 
Illinois and South Carolina and the Michigan Department 
of Consumer and Industry Services as to the authority 
of Company to transact business in those jurisdictions;
 
(c) a certificate of an Assistant Secretary of each of 
Textron and the Company as to the By-Laws of each of 
such corporations and the absence of changes in the 
Restated Certificate of Incorporation of Textron and 
the Certificate of Incorporation, as amended, of 
Company; 

 
(d) the stock records of Company; 
 
(e) minutes of meetings and actions of the Board of 
Directors of Textron; and 
 
(f) such other corporate proceedings of Textron and 
Company and such matters of law as I have deemed 
necessary to enable me to render this opinion.

As to various questions of fact relevant to my opinion I have 
relied upon the representations made in the Purchase Agreement 
and upon certificates of officers of Textron and Fuel Systems 
Textron Inc. ("Fuel Systems"). 

In rendering the opinion expressed below I have assumed, without 
any investigation, that Purchaser has:  (i) all requisite power 
and authority to execute and deliver the Purchase Agreement and 
the other agreements contemplated thereby and to perform all acts 
to be performed by it thereunder; (ii) taken all corporate action 
necessary to authorize the execution and delivery of the Purchase 
Agreement and the other agreements contemplated thereby and to 
perform all acts to be performed by it thereunder; and (iii) duly 
executed and delivered the Purchase Agreement and the other 
agreements contemplated thereby.  I have assumed the genuineness 
of the signatures on all documents which I have examined except 
for those documents signed by officers of Textron, the 
authenticity of all documents submitted to me as originals, and 
the conformity to the corresponding originals of all documents 
submitted to me as copies.

I am admitted to the Bar in the State of Michigan, and I express 
no opinion as to the laws of any jurisdiction other than such 
state and the laws of the United States of America and the 
General Corporation Law of the State of Delaware.   

Based upon and subject to the foregoing, it is my opinion that:

1. Textron and Fuel Systems each is a corporation 
duly organized, validly existing and in good standing 
under the laws of the State of Delaware, and Textron 
has all necessary corporate power and authority to 
enter into the Purchase Agreement and to perform its 
obligations thereunder.  The execution and delivery of 
the Purchase Agreement by Textron and the sale of the 
Share contemplated by the Purchase Agreement have been 
duly authorized by all requisite corporate action on 
the part of Textron.  
 
2. The Purchase Agreement has been duly executed and 
delivered by Textron, and constitutes a legal, valid 
and binding obligation of Textron enforceable against 
Textron in accordance with its terms, except as limited 
by bankruptcy, insolvency, reorganization or other 
similar laws affecting creditors' rights generally and 
except that the term "enforceable" shall not be deemed 
to include the availability of the remedy of specific 
performance or any other equitable remedy available at 
the discretion of a court.
 

3. The execution, delivery and consummation of the 
Purchase Agreement and the sale of the Share 
contemplated by the Purchase Agreement do not and will 
not violate, conflict with or result in the breach of 
any provisions of Textron's Restated Certificate of 
Incorporation or Restated By-laws or conflict with or 
violate any law or, to the best of my knowledge, any 
governmental order.
 
4. The authorized capital stock of Fuel Systems 
consists of one hundred (100) authorized shares of 
Common Stock, par value $.01 per share ("Common 
Stock"), of which one (1) share is issued and 
outstanding on the date hereof.  The issued and 
outstanding share of Common Stock is referred to herein 
as the "Share."  The Share has been duly authorized and 
is validly issued, fully paid, nonassessable and free 
of preemptive rights. Fuel Systems does not hold the 
Share in the treasury of Fuel Systems.  To my 
knowledge, except for the Purchase Agreement, there are 
not outstanding any: (a) options, warrants or other 
rights with respect to the capital stock of Fuel 
Systems; (b) any securities convertible into or 
exchangeable for shares of such capital stock or any 
other debt or equity security of Fuel Systems; or (c) 
any other commitments of any kind for the issuance of 
additional shares of capital stock or other debt or 
equity security of Fuel Systems or options, warrants or 
other rights with respect to such securities.
 
5. The Share is owned by Textron free and clear of 
all encumbrances, and upon consummation of the 
transactions contemplated by the Purchase Agreement the 
Purchaser will receive good title to the Share free and 
clear of all liens, encumbrances, restrictions and 
charges other than any liens, encumbrances, 
restrictions or charges created by Purchaser. 

This opinion is rendered solely for the benefit of Purchaser in 
connection with the Closing of the transaction pursuant to the 
Purchase Agreement and may not be relied upon for any other 
purpose whatsoever.  This opinion may not be used, circulated, 
quoted or referred to without my prior written consent in each 
instance.  This opinion is rendered as of the date set forth 
above, and I express no opinion as to circumstances or events 
which may occur subsequent to the date hereof.

				Very truly yours,

				W. Robert Kemp


						Exhibit B

	June 15, 1998


Textron Inc.
40 Westminster Street
Providence, RI 02903

Ladies and Gentlemen:

I am Robert Reuterfors, General Counsel of Woodward Governor 
Company, a Delaware corporation, ("Woodward Governor") and in 
that capacity have acted as counsel to Woodward Governor in 
connection with the Purchase and Sale Agreement dated as of May 
29, 1998, (the "Purchase Agreement") between Woodward Governor  
and Textron Inc. ("Textron"), and the transactions contemplated 
thereby.  This opinion is being delivered pursuant to Section 7.3 
of the Purchase Agreement.  Capitalized terms which are used and 
not otherwise defined herein shall have the same meaning given to 
them in the Purchase Agreement.

As to various questions of fact relevant to my opinion I have 
relied upon the representations made in the Purchase Agreement 
and upon certificates of officers of Woodward Governor.  I have 
also examined such certificates of public officials, corporate 
documents and records of Woodward Governor and other 
certificates, opinions and instruments, and have made such other 
investigations, as I have deemed necessary in connection with the 
opinions hereinafter set forth.  

In rendering the opinion expressed below I have assumed, without 
any investigation, that Textron has:  (i) all requisite power and 
authority to execute and deliver the Purchase Agreement and the 
other agreements contemplated thereby and to perform all acts to 
be performed by it thereunder; (ii) taken all corporate action 
necessary to authorize the execution and delivery of the Purchase 
Agreement and the other agreements contemplated thereby and to 
perform all acts to be performed by it thereunder; and (iii) duly 
executed and delivered the Purchase Agreement and the other 
agreements contemplated thereby.  I have assumed the genuineness 
of the signatures on all documents which I have examined except 
for those documents signed by officers of Woodward Governor, the 
authenticity of all documents submitted to me as originals, and 
the conformity to the corresponding originals of all documents 
submitted to me as copies.



I am admitted to the Bar in the State of Illinois, and I express 
no opinion as to the laws of any jurisdiction other than such 
state and the laws of the United States of America and the 
General Corporation Law of the State of Delaware.  For purposes 
of this opinion, I have assumed with your permission that the 
internal laws of the State of Michigan are the same as those of 
the State of Illinois.

Based upon and subject to the foregoing, it is my opinion that:

1. Woodward Governor is a corporation duly organized, 
validly existing and in good standing under the laws of 
the State of Delaware, and Woodward Governor has all 
necessary corporate power and authority to enter into 
the Purchase Agreement and to perform its obligations 
thereunder.  The execution and delivery of the Purchase 
Agreement by Woodward Governor and the purchase of the 
Share contemplated by the Purchase Agreement have been 
duly authorized by all requisite corporate action on 
the part of Woodward Governor.  
 
2. The Purchase Agreement has been duly executed and 
delivered by Woodward Governor, and constitutes a 
legal, valid and binding obligation of Woodward 
Governor enforceable against Woodward Governor in 
accordance with its terms, except as limited by 
bankruptcy, insolvency, reorganization or other similar 
laws affecting creditors' rights generally and except 
that the term "enforceable" shall not be deemed to 
include the availability of the remedy of specific 
performance or any other equitable remedy available at 
the discretion of a court.
 
3. The execution, delivery and consummation of the 
Purchase Agreement and the purchase of the Share 
contemplated by the Purchase Agreement do not and will 
not violate, conflict with or result in the breach of 
any provisions of Woodward Governor's Restated 
Certificate of Incorporation or Restated By-laws or 
conflict with or violate any law or, to the best of my 
knowledge, any governmental order.

This opinion is rendered solely for the benefit of Textron in 
connection with the Closing of the transaction pursuant to the 
Purchase Agreement and may not be relied upon for any other 
purpose whatsoever.  This opinion may not be used, circulated, 
quoted or referred to without my prior written consent in each 
instance.  This opinion is rendered as of the date set forth 
above, and I express no opinion as to circumstances or events 
which may occur subsequent to the date hereof.

				Very truly yours,
				
				Robert Reuterfors
	

EX-99

FOR IMMEDIATE RELEASE

CONTACT: Steve Carter
Vice President, Chief Financial Officer & Treasurer
(815) 639-6800

WOODWARD GOVERNOR COMPANY COMPLETES
ACQUISITION OF FUEL SYSTEMS TEXTRON

ROCKFORD, IL, June 22, 1998 - Woodward Governor Company
(Nasdaq: WGOV) today announced the completion of its 
previously announced acquisition of the Fuel Systems 
subsidiary of Textron Inc. (NYSE: TXT)

Fuel Systems Textron ("FST"), which generated revenues of 
$82 million in 1997, will be renamed Fuel Spray Technologies 
("FST Woodward") and operate as part of Woodward's Aircraft 
Engine Systems Group. FST is a leading manufacturer of fuel 
injection nozzles, spray manifolds, and fuel metering and 
distribution valves for gas turbine engines used in the 
aircraft (military and commercial) and industrial markets. 
In addition, it provides commercial repair and overhaul 
services to major engine operators and manufacturers.

FST currently employs about 440 people at plants located in
Zeeland, Michigan; Harvard, Illinois; and Greenville, South
Carolina. To enhance customer support and improve operating
performance, Woodward plans to integrate manufacturing 
operations at the Harvard plant into its nearby aircraft 
facility in Rockford, Illinois, over the coming year. The 
integration will be managed to ensure that all customer 
commitments are met. Most of the Harvard employees, as well 
as essentially all those in Michigan and South Carolina, are 
expected to be retained. In addition, with a few exceptions, 
FST's senior leadership team, including its president, 
Michael Boston, are expected to remain in their positions, 
with no change in responsibilities.

"We are delighted to welcome the FST team aboard," said John 
A. Halbrook, Woodward's chairman and chief executive 
officer. "FST's products greatly expand our aircraft engine 
fuel delivery system capabilities."

"This acquisition adds FST's core competency in spray 
technologies to Woodward's existing competencies in fuel 
metering, actuation and servo components," said C. Phillip 
Turner, general manager of Aircraft Engine Systems. "We 
intend to increase the scope and depth of our contributions 
to our customers' engine programs. Our ability to provide 
innovative and cost-effective products, services, and
systems will be enhanced. In fact, with this acquisition, 
the Aircraft Controls Group has changed its designation to
"Aircraft Engine Systems Group" to better reflect our
ability to serve the total engine fuel delivery market. We 
are looking forward to building upon both companies' 
excellent reputations earned through decades of outstanding 
customer service."

The purchase price of $160 million in cash was financed with 
a bank line of credit. The acquisition is expected to have 
minimal impact on Woodward's results for the fiscal year 
ending September 30, 1998, and to be nondilutive to earnings 
per share in fiscal 1999.

Woodward Governor Company, founded in 1870, provides 
innovative engine controls and fuel delivery systems 
designed for a wide variety of applications. Serving global 
markets with locations worldwide, the company is a leading 
producer of controls systems and components for aircraft and 
industrial engines and turbines. In addition to the aviation
industry, the company's products and services are used in
the marine, locomotive, large off-road vehicle, power 
generation, gas generation, and process manufacturing 
industries.



The statements in this release concerning the company's 
shipments, business performance, and prospects reflect 
current expectations and are forward-looking statements that 
involve risks and uncertainties, including changes in 
product demand, competition, effectiveness of process 
improvement programs, impact of currency exchange rate
changes, and other factors discussed in the September 30, 
1997 Annual Report and Form 10-K filed with the Securities 
and Exchange Commission.

The Woodward Governor Company designs and manufactures 
engine fuel delivery and engine controls systems, subsystems 
and components. 

Corporate headquarters are in Rockford, Illinois, with 
plants and sales offices located worldwide.