Bridgeport Machines Inc – ‘DEFM14A’ on 6/9/99

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Definitive Proxy Solicitation Material — Merger or Acquisition   —   Schedule 14A
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Document/Exhibit                   Description                      Pages   Size 

 1: DEFM14A     Definitive Proxy Statement                            94    554K 

Document Table of Contents

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SCHEDULE 14A INFORMATION  

PROXY STATEMENT PURSUANT TO SECTION 14(A) 
OF THE SECURITIES EXCHANGE ACT OF 1934  

Filed by the Registrant [X]                                                     
Filed by a party other than the Registrant [_]                                  

Check the appropriate box:                                                      

[_] Preliminary Proxy Statement                                                 

[_] Confidential, for Use of the Commission Only (as Permitted by Rule 14a-     
6(e)(2))                                                                  

[X] Definitive Proxy Statement                                                  

[_] Definitive Additional Materials                                             

[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12               

BRIDGEPORT MACHINES, INC. 
----------------------------------------------------- 
(Name of Registrant as Specified In Its Charter)  

----------------------------------------------------- 
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)  

Payment of Filing Fee (Check the appropriate box):                              

[_] No fee required.                                                            
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.    

(1) Title of each class of securities to which transaction applies:         
------------------------------------------------------------------------------- 

(2) Aggregate number of securities to which transaction applies:            
------------------------------------------------------------------------------- 

(3) Per unit price or other underlying value of transaction computed        
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the   
filing fee is calculated and state how it was determined):              

------------------------------------------------------------------------------- 
(4) Proposed maximum aggregate value of transaction:                        

------------------------------------------------------------------------------- 
(5) Total fee paid:                                                         
------------------------------------------------------------------------------- 

[X] Fee paid previously with preliminary materials.                             

[_] Check box if any part of the fee is offset as provided by Exchange Act      
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was    
paid previously. Identify the previous filing by registration statement     
number, or the Form or Schedule and the date of its filing.                 

(1) Amount Previously Paid:                                                 

(2) Form, Schedule or Registration Statement No.:                           

(3) Filing Party:                                                           

(4) Date Filed:                                                             
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BRIDGEPORT MACHINES, INC. 
500 LINDLEY STREET
BRIDGEPORT, CONNECTICUT 06606 

                                                                    June 9, 1999

To the Stockholders of BRIDGEPORT MACHINES, INC.:                               

You are cordially invited to attend a special meeting of stockholders of  
Bridgeport Machines, Inc. (the "Company") to be held at 11:00 a.m., local time, 
on Wednesday, July 14, 1999, at Lehman Brothers Inc., 3 World Financial Center, 
200 Vesey Street, 17th Floor Main Conference Room, New York, New York 10285     
(the "Special Meeting").                                                        

  As described in the accompanying proxy statement, at the Special Meeting you
will be asked to approve a merger agreement and the transactions contemplated   
thereby, including the merger of Bronze Acquisition Corp. with and into the     
Company (the "Merger"), pursuant to which:                                      

. each outstanding share of the common stock of the Company, par value      
 $0.01 per share (the "Common Stock"), will be converted into the right to
receive $10.00 in cash; and                                             

. the Company will become a wholly owned subsidiary of Goldman Industrial   
Group, Inc.                                                             

The Board of Directors has received the written opinion of its financial  
advisor, Lehman Brothers Inc., to the effect that, based upon and subject to    
the matters set forth in such opinion, the consideration to be received by the  
holders of the Common Stock pursuant to the Merger is fair, from a financial    
point of view, to the holders of the Common Stock.                              

The Board of Directors has unanimously approved the Merger Agreement, has 
determined that the Merger is fair to, advisable and in the best interests of   
the Company and the holders of the Common Stock and recommends that             
stockholders vote "FOR" approval and adoption of the Merger Agreement and the   
Merger.                                                                         

YOUR VOTE IS IMPORTANT. To assure your representation at the Special      
Meeting, please complete, sign and date the enclosed proxy card and return it   
in the enclosed prepaid envelope. This will allow your shares to be voted       
whether or not you attend the meeting.                                          

Detailed information concerning the proposed Merger is set forth in the   
accompanying proxy statement. I urge you to read the enclosed material          
carefully and request that you promptly complete and return the enclosed proxy  
in the enclosed return envelope, which requires no postage if mailed in the     
United States. If you attend the Special Meeting, you may vote in person even   
if you have previously returned your proxy. Your vote is important regardless   
of the number of shares of Common Stock you own.                                

          Sincerely,

                            [Joseph E. Clancy Sig. Logo]
                Joseph E. Clancy
                                  Chairman of the Board of Directors

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BRIDGEPORT MACHINES, INC. 
500 LINDLEY STREET
BRIDGEPORT, CONNECTICUT 06606 

----------------  

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS 
TO BE HELD ON JULY 14, 1999 

----------------  

 NOTICE IS HEREBY GIVEN that a special meeting of holders of common stock of
Bridgeport Machines, Inc., a Delaware corporation (the "Company"), will be held 
at 11:00 a.m., local time, on Wednesday, July 14, 1999, at Lehman Brothers      
Inc., 3 World Financial Center, 200 Vesey Street, 17th Floor Main Conference    
Room, New York, New York 10285 for the following purposes:                      

(1) To approve and adopt an Agreement and Plan of Merger, dated as of 
April 23, 1999 (the "Merger Agreement"), by and among Goldman Industrial    
Group, Inc., Bronze Acquisition Corp. and the Company, and the transactions 
contemplated thereby, including the merger of Bronze Acquisition Corp. with 
and into the Company (the "Merger"); and                                    

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

The accompanying proxy statement describes the Merger Agreement and the         
proposed Merger in detail.                                                      

Only holders of common stock of the Company of record at the close of     
business on June 4, 1999 will be entitled to notice of and to vote at the       
meeting or any adjournments or postponements thereof.                           

Stockholders who do not vote in favor of adopting the Merger Agreement and
who otherwise comply with the requirements of Delaware law will be entitled to  
appraisal rights. A summary of the applicable Delaware law provision, including 
the requirements a stockholder must follow in order to exercise his or her      
appraisal rights, is contained in the accompanying proxy statement.             

                                      By order of the Board of Directors

                                    [Walter C. Lazarcheck Sig. Logo]

                        Walter C. Lazarcheck
                                   Vice President, Chief Financial
                           Officer and Secretary

June 9, 1999                                                                    
Bridgeport, Connecticut                                                         

The form of proxy is enclosed. To assure that your shares will be voted at
the Special Meeting, please complete and sign the enclosed proxy and return it  
promptly in the enclosed envelope. No postage is required if mailed in the      
United States. Sending a proxy will not affect your right to vote in person if  
you attend the Special Meeting.                                                 

Please do not send your Common Stock certificates at this time. If the    
Merger is consummated, you will be sent instructions regarding the surrender of 
your certificates.                                                              

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BRIDGEPORT MACHINES, INC. 
500 LINDLEY STREET
BRIDGEPORT, CONNECTICUT 06606 

----------------  

PROXY STATEMENT 

----------------  

This proxy statement is being furnished to the holders of the outstanding 
shares of common stock of Bridgeport Machines, Inc.                             

 This proxy statement is being mailed in connection with the solicitation of
proxies by the Bridgeport Board of Directors for the approval and adoption of   
an agreement and plan of merger involving Bridgeport and Goldman Industrial     
Group, Inc. and the approval of the merger contemplated by that agreement.      

If the merger is completed, Goldman will pay you $10.00 for each share of 
Bridgeport common stock you own, and Bridgeport will become a wholly owned      
subsidiary of Goldman.                                                          

Because our Board of Directors has determined that the terms of the merger
agreement and the merger are fair to, advisable and in the best interests of    
our holders of common stock, the Board unanimously approved and adopted the     
merger agreement. The Board considered the opinion of Lehman Brothers Inc.      
that, as of the date of the opinion, the consideration to be received by our    
stockholders in the merger was fair, from a financial point of view, to our     
stockholders.                                                                   

 The Board of Directors recommends that you vote "FOR" approval and adoption
of the merger agreement and the transactions contemplated by that agreement.    

We have scheduled a special meeting of our stockholders to vote on the    
merger agreement. YOUR VOTE IS VERY IMPORTANT. The special meeting will be held 
at 11:00 a.m., local time, on Wednesday, July 14, 1999, at Lehman Brothers      
Inc., 3 World Financial Center, 200 Vesey Street, 17th Floor Main Conference    
Room, New York, New York 10285.                                                 

 Whether or not you plan to attend the special meeting, please take the time
to vote by completing and mailing the enclosed proxy card to us. If you sign,   
date and mail your proxy without indicating how you want to vote, your proxy    
will be counted as a vote in favor of the merger agreement. If you abstain or   
do not vote, it will have the effect of a vote against the merger agreement.    

This proxy statement provides you with detailed information about the     
proposed merger. Bridgeport's annual report for fiscal 1999 that accompanies    
this proxy statement contains additional information about Bridgeport. We       
encourage you to read the entire proxy statement and the annual report          
carefully.                                                                      

The Securities and Exchange Commission has not passed upon the accuracy or
adequacy of this proxy statement. Any representation to the contrary is         
unlawful.                                                                       

----------------  

  This proxy statement and the accompanying notice of special meeting, form of
proxy and the annual report are first being mailed to stockholders of           
Bridgeport on or about June 9, 1999.                                            

The date of this proxy statement is June 9, 1999. 

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TABLE OF CONTENTS 

                                                                [Download Table]

                                                                            Page
                                                                            ----
                                                                                
QUESTIONS AND ANSWERS ABOUT THE MERGER.....................................   1 
Who Can Help Answer Your Questions.........................................   2 
SUMMARY....................................................................   3 
  The Companies............................................................   3 
  Reasons for the Merger...................................................   3 
  The Special Meeting......................................................   3 
  Recommendation to Stockholders...........................................   4 
  The Merger...............................................................   5 
  Other Interests of Officers and Directors in the Merger..................   6 
  Forward-Looking Statements May Prove Inaccurate..........................   6 
  Information Concerning Goldman...........................................   6 
MARKET PRICE AND DIVIDEND INFORMATION......................................   7 
  Recent Closing Prices....................................................   7 
  Number of Stockholders...................................................   7 
  Dividends................................................................   7 
SELECTED CONSOLIDATED FINANCIAL DATA.......................................   8 
THE SPECIAL MEETING........................................................   9 
  General; Date; Place and Time............................................   9 
  Purpose of the Special Meeting...........................................   9 
  Record Date; Voting Power................................................   9 
  Vote Required............................................................   9 
  Revocation of Proxy......................................................  10 
  Expenses of Solicitation.................................................  10 
  Miscellaneous............................................................  10 
THE PARTIES................................................................  10 
  Bridgeport Machines, Inc.................................................  10 
  Goldman Industrial Group, Inc............................................  11 
THE MERGER.................................................................  11 
  Background of the Merger.................................................  11 
  Reasons for the Merger; Recommendation of the Board of Directors.........  12 
  Projections..............................................................  14 
  Opinion of the Company's Financial Advisor...............................  15 
  Certain Federal Income Tax Consequences of the Merger ...................  20 
  Accounting Treatment of the Merger.......................................  20 
  Regulatory Filings and Approvals.........................................  20 
  Financing Commitments....................................................  21 
  Management, Operations and Ownership Structure Following the Merger......  21 
  Appraisal Rights.........................................................  21 
  Public Trading Market....................................................  23 
THE MERGER AGREEMENT.......................................................  23 
  General; Merger Consideration............................................  23 
  Dissenting Shares........................................................  23 
  Treatment of Stock Options...............................................  24 
  Closing; Effective Time..................................................  24 
  Cancellation of Shares...................................................  24 
  Exchange of Certificates.................................................  24 
  Transfers................................................................  24 
  Lost, Stolen or Destroyed Certificates...................................  24 
  Representations and Warranties...........................................  24 

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                                                                [Download Table]

                                                                            Page
                                                                            ----
                                                                                
  Conduct of Business Prior to the Merger..................................  25 
  Agreement Not to Solicit Other Offers....................................  27 
  Board Recommendations....................................................  28 
  Certain Other Covenants and Agreements...................................  28 
  Conditions to the Proposed Merger........................................  30 
  Termination..............................................................  32 
  Termination Fee; Reimbursement of Goldman Expenses on Termination........  33 
  Amendment and Waiver.....................................................  35 
INTERESTS OF CERTAIN PERSONS IN THE MERGER.................................  35 
  Stock Options............................................................  35 
  Employment Agreements....................................................  35 
  Consulting Agreement.....................................................  35 
RELATED AGREEMENTS AND TRANSACTIONS........................................  36 
  Voting Agreements for Principal Stockholders Other Than Textron..........  36 
  Textron Voting Agreement.................................................  36 
  Textron Confirmation Letter..............................................  36 
OWNERSHIP OF COMMON STOCK..................................................  37 
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS..................  39 
AVAILABLE INFORMATION......................................................  40 
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE............................  40 

APPENDIX A--  AGREEMENT AND PLAN OF MERGER                                      
APPENDIX B--  TEXTRON INC. VOTING AGREEMENT                                     
APPENDIX C--  FORM OF VOTING AGREEMENT FOR PRINCIPAL STOCKHOLDERS OTHER THAN    
TEXTRON INC.                                        
APPENDIX D--  TEXTRON INC. CONFIRMATION LETTER                                  
APPENDIX E--  FAIRNESS OPINION OF LEHMAN BROTHERS INC.                          
APPENDIX F--  SECTION 262 OF THE DELAWARE GENERAL CORPORATION LAW               

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QUESTIONS AND ANSWERS ABOUT THE MERGER

This summary highlights certain information from this proxy statement, is 
qualified by reference to the proxy statement and may not contain all of the    
information that is important to you. To understand the merger more fully and   
for a more complete description of the legal terms of the merger, you should    
read carefully this entire proxy statement, the annual report that accompanies  
this proxy statement and is incorporated in this proxy statement by reference   
and the appendices included with the proxy statement. The summary does not      
contain a complete statement of material information relating to the merger     
agreement, the merger, or other matters discussed in this document.             

Q.Why is Bridgeport proposing to merge with Goldman?                            

A. The Board of Directors determined to recommend approval of the merger        
agreement and the merger based on a wide variety of factors, including:   

.  Bridgeport's current financial situation, on both an historical and      
  prospective basis, and current industry, economic and market conditions;

.  the premium offered by Goldman over the historical market prices and     
recent trading activity of Bridgeport's common stock;                 

.  the terms and provisions of the merger agreement and related agreements; 
and                                                                   

.  the opinion of Bridgeport's financial advisor, Lehman Brothers, based    
upon and subject to certain matters stated in such opinion, as to the 
fairness, from a financial point of view, of the consideration to be  
received by holders of Bridgeport's common stock in the merger.       

Q. What will I receive as a result of the merger?                               

A. You will receive $10.00 in cash, without interest, in exchange for each      
share of Bridgeport's common stock.                                       

Q. What do I need to do now?                                                    

A. After you have carefully read this proxy statement, just indicate on your    
proxy card how you want to vote, and sign and mail it in the enclosed     
prepaid return envelope as soon as possible, so that your shares of common
stock may be represented at the special meeting. The special meeting will 
  take place at 11:00 a.m., local time, on Wednesday, July 14, 1999, at Lehman
Brothers Inc., 3 World Financial Center, 200 Vesey Street, 17th Floor Main
Conference Room, New York, New York 10285. The Board of Directors         
unanimously recommends voting "FOR" the merger agreement and the proposed 
merger.                                                                   

Q. What vote is required to approve the merger?                                 

A. In order to complete the merger, the merger agreement must be approved by a  
 majority of the votes eligible to be cast by the holders of the outstanding
  shares of Bridgeport's common stock. The holders of approximately 40% of the
  outstanding common stock have granted to Goldman irrevocable proxies to vote
 all of the shares that they hold and all of the shares over which they have
  voting control in favor of the approval and adoption of the merger agreement
and the merger.                                                           

Q. If my shares are held in "street name" by my broker, will my broker vote my  
shares for me?                                                            

A. Your broker will vote your shares only if you provide instructions on how to 
  vote. You should follow the directions provided by your broker regarding how
to instruct your broker to vote your shares. Without instructions, your   
shares will not be voted, which for purposes of voting on the merger      
agreement and the merger, will have the same effect as voting against the 
merger agreement and the merger.                                          

Q. Can I change my vote after I have mailed my signed proxy card?               

A. Yes. You can change your vote at any time before your proxy is voted at the  
special meeting of stockholders. You can do this in one of three ways.    

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.  First, you can send a written notice stating that you would like to      
revoke your proxy.                                                    

.  Second, you can complete and submit a new proxy card. If you choose      
either of these two methods, you must submit your notice of revocation
or your new proxy card to Bridgeport at the address on the bottom of  
this page.                                                            

.  Third, you can attend the special meeting of stockholders and vote in    
person. Simply attending the special meeting, however, will not revoke
your proxy.                                                                 

If you have instructed a broker to vote your shares, you must follow        
directions received from your broker to change your vote.                   

Q. Will I have appraisal rights as a result of the merger?                      

A. Yes. Stockholders have appraisal rights. If you wish to exercise your        
  appraisal rights you must follow the requirements of Delaware law. A summary
describing the requirements you must follow in order to exercise your     
appraisal rights is described in greater detail beginning on page 21.     

Q. Should I send in my stock certificates when I return my proxy form?          

A. No. Holders of common stock should not send in their stock certificates now. 
  Following the merger, a separate letter of transmittal will be mailed to the
holders of common stock which will enable holders to receive the merger   
consideration due to them.                                                

Q. When do you expect the merger to be completed?                               

A. We are working towards completing the merger as quickly as possible. As      
  described above, we must obtain the approval of our stockholders to complete
the merger. We presently expect to complete the merger promptly after the 
special meeting.                                                          

Q. What are the tax consequences of the merger?                                 

A. The receipt of cash by a stockholder of Bridgeport in the merger will be a   
 taxable transaction for federal income tax purposes and may also be taxable
under applicable state, local and foreign income and other tax laws. A    
  stockholder will recognize gain or loss in an amount equal to the difference
between the adjusted tax basis of the common stock and the amount of cash 
 received in exchange for that stock in the merger. The gain or loss will be
 capital gain or loss if the common stock is a capital asset in the hands of
the stockholder and will be long-term capital gain or loss if the holding 
period exceeds one year. To review the tax consequences to stockholders in
greater detail, see page 20.                                              

Q. What other matters will be voted on at the special meeting?                  

A. We do not expect to ask you to vote on any matter other than the merger      
agreement at the special meeting.                                         

Who Can Help Answer Your Questions

If you have more questions about the merger or if you would like additional 
copies of this proxy statement, you should contact: 

Bridgeport Machines, Inc. 
500 Lindley Street
Bridgeport, Connecticut 06606 
Attention: Walter C. Lazarcheck 
Phone Number: (203) 367-3651

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SUMMARY 

The Companies                                                                   

Bridgeport Machines, Inc.                                                       
500 Lindley Street                                                              
Bridgeport, Connecticut 06606                                                   
(203) 367-3651                                                                  

Bridgeport, founded in 1939, is a leading manufacturer of manual and      
computer numerically controlled metal cutting machine tools in the United       
States and United Kingdom. Bridgeport focuses primarily on standardized,        
general-purpose machine tools for small to medium sized machine shops           
throughout the United States and in 60 countries worldwide. Bridgeport also     
manufactures and sells surface grinders under the "Harig" brand name and sells  
manual and computer numerically controlled lathes under the "ROMI" and "EZ-     
PATH" brand names.                                                              

Goldman Industrial Group, Inc.                                                  
One Post Office Square                                                          
Suite 4100                                                                      
Boston, Massachusetts 02109                                                     
(617) 338-1200                                                                  

Goldman is a privately-held company which, through its five operating     
subsidiaries, provides metal working machinery to industry. Goldman's products  
include gear production machines, grinding machines, consumable gear cutting    
tools, optical inspection equipment, casting machinery and related products and 
accessories. The products are marketed under the "Fellows", "Bryant", "J&L      
Metrology", "Jones & Lamson", "Hill Acme" and "Loma Machines" brand names.      

Reasons for the Merger                                                          

The Bridgeport Board of Directors determined to recommend approval and    
adoption of the merger agreement and the merger based on a variety of factors,  
including:                                                                      

.  Bridgeport's current financial situation, on both an historical and      
  prospective basis, and current industry, economic and market conditions;

.  the premium offered by Goldman over the historical market prices and     
recent trading activity of Bridgeport's common stock;                 

.  the terms and provisions of the merger agreement and related agreements; 
and                                                                   

.  the opinion of Bridgeport's financial advisor, Lehman Brothers, based    
upon and subject to certain matters stated in such opinion, as to the 
fairness, from a financial point of view, of the consideration to be  
received by holders of common stock in the merger.                    

The Special Meeting                                                             

 When and Where. The special meeting will be held at 11:00 a.m., local time,
on Wednesday, July 14, 1999, at Lehman Brothers Inc., 3 World Financial Center, 
200 Vesey Street, 17th Floor Main Conference Room, New York, New York 10285.    

Purposes of the Special Meeting. At the special meeting, you will be asked
to approve and adopt the merger agreement and the consummation of the merger.   

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Record Date; Voting Power. Holders of common stock as of the close of     
business on June 4, 1999, the record date, are entitled to vote at the special  
meeting or any adjournment thereof. As of the record date, there were           
outstanding 5,568,104 shares of common stock. Each share of common stock is     
entitled to one vote.                                                           

Vote Required. The affirmative vote of a majority of the votes eligible to
be cast by holders of the outstanding shares of common stock as of the record   
date is required to approve and adopt the merger agreement and the merger.      

As a condition and inducement to Goldman's entering into the merger       
agreement, Textron Inc., Lehman LBO Inc., State of Delaware Employees           
Retirement Fund, Joseph E. Clancy and Dan L. Griffith, who hold, in the         
aggregate, approximately 40% of Bridgeport's outstanding common stock, granted  
to Goldman irrevocable proxies to vote all of the shares that they hold and all 
of the shares over which they have voting control in favor of the adoption of   
the merger agreement and approval of the merger.                                

Revocation of Proxy. A stockholder may revoke a proxy at any time prior to
its exercise by (i) delivering to Walter C. Lazarcheck, Vice President, Chief   
Financial Officer and Secretary, Bridgeport Machines, Inc., 500 Lindley Street, 
Bridgeport, Connecticut 06606, a written notice of revocation of proxy prior to 
the special meeting, (ii) delivering prior to the special meeting a duly        
executed proxy bearing a later date or (iii) attending the special meeting and  
voting in person. The presence of a stockholder at the special meeting will not 
in and of itself automatically revoke such stockholder's proxy. If not revoked, 
the proxy will be voted in accordance with the instructions indicated on the    
proxy, or if no instructions are indicated on a properly executed proxy, such   
proxy will be voted "FOR" the approval and adoption of the merger agreement.    

Quorum; Abstentions and Broker Non-Votes. The required quorum for the     
special meeting is a majority of votes eligible to be cast by holders of common 
stock issued and outstanding as of the record date. Both abstentions and broker 
non-votes will be included in determining the number of votes present and       
voting at the special meeting for the purpose of determining the presence of a  
quorum. Abstentions and broker non-votes will have the same effect as votes     
against the merger agreement and the consummation of the merger. The actions    
proposed in this proxy statement are not matters that can be voted on by        
brokers holding shares for beneficial owners without the owners' specific       
instructions. Accordingly, all beneficial owners of common stock are urged to   
return the enclosed proxy card marked to indicate their votes.                  

Recommendation to Stockholders                                                  

  On April 23, 1999, the Bridgeport Board of Directors (i) determined that the
merger and the transactions contemplated by the merger agreement are fair,      
equitable and in the best interests of Bridgeport and its stockholders, (ii)    
approved and adopted the merger agreement and (iii) resolved to recommend that  
its stockholders vote in favor of the merger agreement and the merger           
contemplated by that agreement. The Board of Directors unanimously recommends a 
vote "FOR" approval and adoption of the merger agreement and the merger.        

Opinion of Financial Advisor. On April 23, 1999, Lehman Brothers delivered
its oral opinion to the Board of Directors that as of such date, and based upon 
the assumptions and subject to the limitations set forth therein, the           
consideration to be received by holders of common stock in the merger was fair, 
from a financial point of view, to such holders. Lehman Brothers subsequently   
confirmed that oral opinion by delivering a written opinion dated April 23,     
1999. The full text of the written opinion of Lehman Brothers, which set forth  
assumptions made, matters considered and limitations on the review undertaken   
in connection with the opinion, is attached hereto as Appendix E and is         
incorporated in this proxy statement by reference.                              

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The Merger                                                                      

 The merger agreement is attached as Appendix A to this proxy statement. The
Bridgeport Board of Directors encourages you to read the merger agreement in    
its entirety. It is the legal document governing the merger.                    

  What Bridgeport's stockholders receive as a result of the merger. Holders of
common stock will receive $10.00 in cash, without interest, in exchange for     
each share of common stock.                                                     

What holders of stock options will receive as a result of the merger.     
Bridgeport will use its reasonable efforts to provide for the return and        
cancellation of each outstanding stock option in exchange for an amount in cash 
equal to the product of (A) the excess, if any, of $10.00 over the exercise     
price of each such option and (B) the number of shares subject to the option.   
Substantially all of Bridgeport's outstanding stock options have exercise       
prices in excess of $10.00 per share.                                           

Conditions to the merger. Consummation of the merger is subject to various
conditions, including, among others:                                            

.the approval of the merger by the stockholders at the special meeting;     

.that no law has been enacted or injunction entered which effectively       
prohibits the merger;                                                       

.  that all necessary approvals of governmental authorities and the         
consents of the holders of all outstanding stock options to the       
cancellation of their options have been obtained; and                 

.  that Bridgeport's and Goldman's respective representations and           
  warranties are true and correct in all material respects and the parties
have performed in all material respects their respective obligations  
under the merger agreement.                                           

Termination. Bridgeport and Goldman can agree to terminate the merger     
agreement without completing the merger, and either can terminate the merger    
agreement if any of the following occurs:                                       

.  the merger is not completed by December 31, 1999;                        

.  a court or other governmental authority permanently prohibits the        
merger;                                                               

.  the required approval of the stockholders is not received at the special 
meeting;                                                              

.  if the Bridgeport Board of Directors recommends to stockholders a        
Superior Proposal (as defined below); or                              

.  the other company materially breaches or fails to comply with any of its 
  representations or warranties or obligations under the merger agreement.

In addition, Goldman can terminate the merger agreement if, among other   
things, (A) Bridgeport approves or effects, or its Board of Directors           
recommends, a business combination with a third party, or (B) the Bridgeport    
Board of Directors withdraws or adversely modifies its approval or              
recommendation of the merger agreement.                                         

Termination fee; Reimbursement of Goldman expenses on termination. If the 
merger agreement is terminated under certain circumstances, Bridgeport is       
required to pay to Goldman a termination fee equal to the amount by which $3.25 
million exceeds the fee payable in such event, if any, by Textron to Goldman in 
accordance with the terms of a voting agreement between Goldman and Textron,    
dated as of April 23, 1999.                                                     

If the merger agreement is terminated under circumstances that obligate   
Bridgeport to pay to Goldman the termination fee, Textron, which holds          
approximately 21% of the outstanding Bridgeport common stock, has agreed to pay 
to Goldman an amount equal to the product of (a) the amount by which the        
consideration per share paid to Textron in the transaction triggering such      
termination exceeds $10.00, and (b) the total number of shares of common stock  
transferred by Textron in such transaction.                                     

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If the merger agreement is terminated under certain other circumstances,  
Bridgeport is required to reimburse Goldman for all expenses incurred by        
Goldman since January 1, 1999 in connection with the merger agreement and the   
related transactions, subject to limitations on the maximum amount to be        
reimbursed.                                                                     

Regulatory approvals. The Hart-Scott-Rodino Antitrust Improvements Act of 
1976, as amended, prohibits the companies from completing the merger until      
after the companies have furnished certain information and materials to the     
Antitrust Division of the Department of Justice and the Federal Trade           
Commission and a required waiting period has ended. On May 6, Bridgeport and    
Goldman, respectively, furnished that information. Early termination of the     
waiting period was granted on May 24, 1999. However, the Department of Justice  
and the Federal Trade Commission will continue to have the authority to         
challenge the merger on antitrust grounds before or after the merger is         
completed.                                                                      

Federal income tax consequences. The receipt of cash by a stockholder of  
Bridgeport in the merger will be a taxable transaction for federal income tax   
purposes and may also be taxable under applicable state, local and foreign      
income and other tax laws. A stockholder will recognize gain or loss in an      
amount equal to the difference between the adjusted tax basis of the common     
stock and the amount of cash received in exchange for that stock in the merger. 
The gain or loss will be capital gain or loss if the common stock is a capital  
asset in the hands of the stockholder and will be long-term capital gain or     
loss if the holding period exceeds one year. To review the tax consequences to  
stockholders in greater detail, see page 20.                                    

Appraisal rights. Pursuant to Section 262 of the Delaware General         
Corporation Law, stockholders have a right to an appraisal of the value of      
their shares in connection with the merger. For a description of this right,    
see page 21.                                                                    

Other Interests of Officers and Directors in the Merger                         

 In considering the recommendation of the Bridgeport Board of Directors with
regard to the merger, stockholders should be aware that certain officers and    
directors of Bridgeport have agreements which will be effected as a result of   
the merger. In addition, certain officers of Bridgeport have entered into new   
employment or consulting arrangements that become effective upon consummation   
of the merger.                                                                  

Forward-Looking Statements May Prove Inaccurate                                 

Bridgeport has made forward looking statements in this proxy statement and
in the annual report incorporated by reference in this proxy statement that are 
subject to risks and uncertainties. Forward looking statements include          
information concerning possible or assumed future results of operations of      
Bridgeport. When words such as "believes," "expects," "anticipates" or similar  
expressions are used, they are intended to identify forward looking statements. 
Stockholders should note that many factors, some of which are discussed         
elsewhere in this proxy statement and in the annual report incorporated in this 
proxy statement by reference, could affect the future financial and business    
results of Bridgeport and could cause those results to differ materially from   
those expressed in the forward looking statements contained or incorporated by  
reference into this document. These factors include, but are not limited to,    
uncertainties relating to general economic conditions, product introductions,   
contingent liabilities, changes in currency exchange rate, the mix of products  
sold and the profit margins thereon, order cancellations or reduced bookings by 
customers or distributors, discounting necessitated by price competition, and   
general market conditions.                                                      

Information Concerning Goldman                                                  

  All information contained in this proxy statement concerning Goldman and its
subsidiaries, including Bronze Acquisition Corp., has been supplied by Goldman  
and has not been independently verified by Bridgeport.                          

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MARKET PRICE AND DIVIDEND INFORMATION 

The common stock is traded on the Nasdaq National Market under the trading
symbol "BPTM". The following table sets forth for the fiscal quarters           
indicated, the high and low closing sale prices per share of the common stock   
as reported by Nasdaq.                                                          

                                                                [Download Table]

                                                          High    Low      
                                                          ----    ----     
                                                                           
Fiscal 1998                                                                
  First Quarter ended June 28, 1997...................... $11 1/4 $ 8 1/2  
  Second Quarter ended September 27, 1997................ $12 1/4 $ 9 3/4  
  Third Quarter ended December 27, 1997.................. $13 3/8 $ 10     
                                                                  $ 10     
  Fourth Quarter ended March 28, 1998.................... $12 3/4  1/2     
Fiscal 1999                                                                
  First Quarter ended June 27, 1998...................... $13 7/8 $10 1/2  
  Second Quarter ended October 3, 1998................... $12 1/8 $ 8 5/8  
  Third Quarter ended January 2, 1999.................... $  9    $ 4 3/8  
  Fourth Quarter ended April 3, 1999..................... $ 8 3/4 $ 4 11/16
Fiscal 2000                                                                
  First Quarter (through June 4, 1999)................... $ 9 3/8 $ 5 1/8  

Recent Closing Prices                                                           

On April 22, 1999, the last trading day before the public announcement of 
the proposed merger, the reported closing sale price per share of common stock  
was $6.00. On June 4, 1999, the reported closing sale price per share of common 
stock was $8.875.                                                               

Number of Stockholders                                                          

On June 4, 1999, there were approximately 70 holders of record of common  
stock.                                                                          

Dividends                                                                       

We have not declared or paid any cash dividends on the common stock during
the three fiscal years ended March 31, 1999. Our present policy is to retain    
earnings for use in the business.                                               

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SELECTED CONSOLIDATED FINANCIAL DATA

The selected financial data of Bridgeport for the years 1999, 1998, 1997, 
1996 and 1995 presented below has been derived from the audited consolidated    
financial statements of Bridgeport. The information shown below is qualified in 
its entirety by, and should be read in conjunction with, the related            
consolidated financial statements of Bridgeport, including the related notes    
thereto and "Management's Discussion and Analysis of Financial Condition and    
Results of Operations", contained in the annual report accompanying and         
incorporated by reference in this proxy statement.                              

                                                                [Download Table]

                          Year Ended Year Ended Year Ended Year Ended Year Ended
                           April 3,  March 28,  March 29,  March 30,   April 1, 
                             1999       1998       1997       1996       1995   
                          ---------- ---------- ---------- ---------- ----------
                                  (In thousands, except per share data)         
                                                                                
Statement of Operations                                                         
 Data:                                                                          
  Net Sales.............   $179,758   $213,770   $227,549   $209,214   $148,783 
  Net Income (Loss).....       (486)     3,915      8,001      8,424      6,921 
Basic Earnings (Loss)                                                           
 Per Share..............   $  (0.09)  $   0.69   $   1.41   $   1.49   $   1.48 
Basic Weighted Average                                                          
 Number of Shares of                                                            
 Common Stock                                                                   
 Outstanding............      5,619      5,657      5,679      5,665      4,660 
Diluted Earnings (Loss)                                                         
 Per Share..............   $  (0.09)  $   0.69   $   1.40   $   1.47   $   1.48 
Diluted Weighted Average                                                        
 Number of Shares of                                                            
 Common Stock                                                                   
 Outstanding............      5,619      5,672      5,720      5,748      4,673 

                           April 3,  March 28,  March 29,  March 30,   April 1, 
                             1999       1998       1997       1996       1995   
                          ---------- ---------- ---------- ---------- ----------
                                  (In thousands, except per share data)         
                                                                                
Balance Sheet Data:                                                             
  Working Capital.......   $ 50,040   $ 51,600   $ 49,696   $ 39,148   $ 42,810 
  Total Assets..........    102,966    136,110    131,711    129,156     88,394 
  Long Term Debt                                                                
   Obligations..........      1,086      3,142      5,862      4,475      3,101 
  Stockholders' Equity..     67,166     69,323     65,586     57,109     50,209 

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THE SPECIAL MEETING 

General; Date; Place and Time                                                   

This proxy statement is being provided by, and the enclosed proxy is      
solicited by and on behalf of, the Board of Directors (the "Board of            
Directors") of Bridgeport Machines, Inc. (the "Company") for use at a special   
meeting (the "Special Meeting") of the holders of the common stock of the       
Company, par value $0.01 per share (the "Common Stock").                        

The Special Meeting is scheduled to be held at 11:00 a.m., local time, on 
Wednesday, July 14, 1999, at Lehman Brothers Inc., 3 World Financial Center,    
200 Vesey Street, 17th Floor Main Conference Room, New York, New York 10285.    

Purpose of the Special Meeting                                                  

  The purpose of the Special Meeting is to consider and vote upon the approval
and adoption of the Agreement and Plan of Merger, dated as of April 23, 1999    
(the "Merger Agreement"), by and among Goldman Industrial Group, Inc.           
("Goldman"), Bronze Acquisition Corp. ("Merger Sub") and the Company, and the   
approval of the transactions contemplated by that agreement, including the      
merger of Merger Sub with and into the Company (the "Merger"), and to transact  
any other business that is properly brought before the Special Meeting.         

Record Date; Voting Power                                                       

Only holders of shares of Common Stock as of the close of business on June
4, 1999 (the "Record Date") will be entitled to receive notice of and to vote   
at the Special Meeting. As of the Record Date, there were 5,568,104 shares of   
Common Stock outstanding and entitled to vote at the Special Meeting. Each      
share of Common Stock is entitled to one vote.                                  

Vote Required                                                                   

The affirmative vote of a majority of votes eligible to be cast by holders
of the outstanding shares of Common Stock as of the Record Date is required to  
approve and adopt the Merger Agreement.                                         

As a condition and inducement to Goldman's entering into the Merger       
Agreement, Textron Inc. ("Textron"), Lehman LBO Inc., State of Delaware         
Employees Retirement Fund, Joseph E. Clancy and Dan L. Griffith (collectively,  
the "Principal Stockholders"), who hold, in the aggregate, approximately 40% of 
the outstanding Common Stock, granted to Goldman irrevocable proxies to vote    
all of the shares that they hold and all of the shares over which they have     
voting control in favor of the adoption of the Merger Agreement and approval of 
the Merger.                                                                     

Because the required vote of the stockholders with respect to the Merger  
Agreement is based upon the total number of outstanding shares of Common Stock, 
the failure to submit a proxy card (or to vote in person at the Special         
Meeting) or the abstention from voting by a stockholder will have the same      
effect as a vote against approval and adoption of the Merger Agreement. Brokers 
holding shares of Common Stock as nominees will not have discretionary          
authority to vote such shares in the absence of instructions from the           
beneficial owners thereof.                                                      

  The Delaware General Corporation Law (the "DGCL"), the Company's Amended and
Restated Certificate of Incorporation (the "Certificate of Incorporation"), the 
Company's Amended and Restated By-laws (the "By-laws") and the Securities       
Exchange Act of 1934, as amended (the "Exchange Act") contain requirements      
governing the actions of the Company's stockholders at the Special Meeting.     
According to the By-laws, the holders of a majority of the shares of the Common 
Stock outstanding on the Record Date must be present, either in person or by    
proxy, at the Special Meeting to constitute a quorum. In general, abstentions   
and broker non-votes are counted as present or represented at the Special       
Meeting for the purpose of determining a quorum for the Special Meeting.        

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The obligation of the Company and Goldman to consummate the Merger is     
subject to, among other things, the condition that the stockholders approve and 
adopt the Merger Agreement. The failure to obtain such approval affords each of 
the Company and Goldman the right to terminate the Merger Agreement.            

Revocation of Proxy                                                             

A stockholder may revoke a proxy at any time prior to its exercise by (i) 
delivering to Walter C. Lazarcheck, Vice President, Chief Financial Officer and 
Secretary, Bridgeport Machines, Inc., 500 Lindley Street, Bridgeport,           
Connecticut 06606, a written notice of revocation of proxy prior to the Special 
Meeting, (ii) delivering prior to the Special Meeting a duly executed proxy     
bearing a later date or (iii) attending the Special Meeting and voting in       
person. The presence of a stockholder at the Special Meeting will not in and of 
itself automatically revoke such stockholder's proxy. If not revoked, the proxy 
will be voted in accordance with the instructions indicated on the proxy, or if 
no instructions are indicated on a properly executed proxy, such proxy will be  
voted "FOR" the approval and adoption of the Merger Agreement.                  

Expenses of Solicitation                                                        

 The Company will bear the costs of soliciting proxies from stockholders. In
addition to soliciting proxies by mail, directors, officers and employees of    
the Company, without receiving additional compensation therefor, may solicit    
proxies by telephone, by facsimile or in person. Arrangements may also be made  
with brokerage firms and other custodians, nominees and fiduciaries to forward  
solicitation materials to the beneficial owners of shares held of record by     
such persons, and the Company will reimburse such brokerage firms, custodians,  
nominees and fiduciaries for reasonable out-of-pocket expenses incurred by them 
in connection therewith.                                                        

Miscellaneous                                                                   

 It is not expected that any matter not referred to herein will be presented
for action at the Special Meeting. If any other matters are properly brought    
before the Special Meeting, the persons named in the proxies will have          
discretion to vote on such matters in accordance with their best judgment. The  
grant of a proxy will also confer discretionary authority on the persons named  
in the proxy as proxy appointees to vote in accordance with their best judgment 
on matters incident to the conduct of the Special Meeting, including (except as 
stated in the following sentence) postponement or adjournment for the purpose   
of soliciting additional votes. However, shares represented by proxies that     
have been voted "AGAINST" the Merger Agreement and the Merger will not be used  
to vote "FOR" postponement or adjournment of the Special Meeting for the        
purposes of allowing additional time for soliciting additional votes "FOR" the  
approval and adoption of the Merger Agreement and the Merger.                   

 Holders of Common Stock should not send their stock certificates with their
proxy cards. If the Merger is consummated, a separate letter of transmittal     
will be mailed to the holders of Common Stock which will enable a holder to     
receive the appropriate consideration.                                          

THE PARTIES 

Bridgeport Machines, Inc.                                                       

The Company, founded in 1939, is a leading manufacturer of manual and     
computer numerically controlled ("CNC") metal cutting machine tools in the      
United States and United Kingdom. The Company focuses primarily on              
standardized, general-purpose machine tools for small to medium sized machine   
shops throughout the United States and in 60 countries worldwide. The Company   
also manufactures and sells surface grinders under the "Harig" brand name and   
sells manual and CNC lathes under the "ROMI" and "EZ-PATH" brand names. The     
Company's annual report on Form 10-K for fiscal 1999 that accompanies this      
proxy statement (the "Annual Report") contains additional information about the 
Company.                                                                        

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The principal executive offices of the Company are located at 500 Lindley 
Street, Bridgeport, Connecticut 06606 and its telephone number is (203) 367-    
3651.                                                                           

Goldman Industrial Group, Inc.                                                  

Goldman is a privately-held company which, through its five operating     
subsidiaries, provides metal working machinery to industry. Goldman's products  
include gear production machines, grinding machines, consumable gear cutting    
tools, optical inspection equipment, casting machinery and related products and 
accessories. The products are marketed under the "Fellows", "Bryant", "J&L      
Metrology", "Jones & Lamson", "Hill Acme" and "Loma Machines" brand names.      

The principal executive offices of Goldman are located at One Post Office 
Square, Suite 4100, Boston, Massachusetts 02109 and its telephone number is     
(617) 338-1200.                                                                 

THE MERGER

Background of the Merger                                                        

  In April 1996, the Company retained Lehman Brothers Inc. ("Lehman Brothers")
to serve as its financial advisor and, in that capacity, to identify            
opportunities for the sale of the Company and to advise the Company in          
connection with any such sale. Over the next 12 months, Lehman Brothers         
conducted a broad auction of the Company. In that process, Lehman Brothers      
contacted persons, both domestic and foreign, that it viewed as potential       
strategic or financial buyers of the Company. The Company and its advisors held 
discussions with a number of those persons concerning a possible transaction    
with the Company. None of these discussions resulted in a definitive agreement  
regarding a transaction.                                                        

In March 1998, Greg Goldman, the President and Chief Executive Officer of 
Goldman, contacted the Company regarding Goldman's interest in acquiring the    
Company. Goldman entered into a confidentiality agreement with the Company on   
April 3, 1998. During April and early May 1998, Goldman and its financial and   
legal advisors conducted a due diligence investigation of the Company and its   
operations and discussed the terms of a potential acquisition with members of   
Company management, Lehman Brothers and Willkie Farr & Gallagher, the Company's 
legal counsel. Goldman indicated that its obligation to close any acquisition   
would be subject to a financing condition and that it would fund a purchase of  
the Company through a high-yield note offering and bank financing. At a May 8,  
1998 meeting, the Board of Directors determined that it would not proceed with  
a transaction with Goldman because of the financing contingency, its concern    
over whether a high-yield note offering could be successfully completed and its 
unwillingness to have the Company effectively bear that financing risk.         

In July 1998, Goldman informed the Company that it was still interested in
pursuing a transaction with the Company but had not obtained financing          
commitments that would address the Board's concerns regarding the financing of  
a proposed transaction. The Board of Directors advised Goldman later in the     
month that it was not interested in continuing to pursue a potential            
transaction that lacked committed financing.                                    

In December 1998, Mr. Goldman contacted Bhikhaji M. Maneckji, Textron's   
designee on the Board of Directors, and stated that Goldman would be interested 
in pursuing an acquisition of the Company. Mr. Goldman advised Mr. Maneckji     
that Goldman was prepared to offer $8.00 per share of Common Stock. In early    
January, Mr. Maneckji told Goldman that he did not believe that the Board of    
Directors would consider a sale of the Company in a transaction with a          
financing contingency or at that price. In mid-January, Mr. Goldman informed    
Mr. Maneckji that Goldman would be prepared to consider an acquisition of the   
Company at $10.00 per share in a transaction that would not be subject to a     
financing condition but would be subject to a number of other conditions.       

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 On January 19, 1999, Goldman entered into the Confidentiality Agreement (as
defined below) with the Company, and the Company again retained Lehman Brothers 
as its financial advisor in connection with a potential sale of the Company.    
During January and February, Goldman and its potential lenders conducted a due  
diligence investigation of the Company and its operations.                      

On March 15, 1999, High Technology Holding Corp. ("HTH") sent a letter to 
the Company in which HTH suggested, among other things, that the Company should 
tender for up to 50% of the outstanding Common Stock at a purchase price of     
$10.125 per share and finance that tender through significant additional        
borrowings. HTH, which has publicly reported that it owns 10% of the Company's  
outstanding Common Stock, issued a press release on March 16 announcing the     
suggested transaction. On March 22, the Board of Directors reviewed the         
suggested actions with Lehman Brothers and determined not to implement the      
suggested stock repurchase because the Board of Directors did not believe such  
an action would be in the best interest of the Company and its stockholders.    
The Company issued a press release on March 23 announcing its decision with     
regard to the suggested transaction.                                            

On March 25, 1999, Goldman submitted to the Board of Directors a non-     
binding, written indication of its interest in acquiring the Company at         
purchase price of $10 per share of Common Stock in a transaction that would not 
be subject to any financing conditions but would be subject to a number of      
other conditions. On March 30, the Board of Directors met to review the Goldman 
proposal. At that meeting, the Board of Directors authorized Company management 
and its advisors to attempt to negotiate an acquisition agreement, but          
indicated that it would not approve any transaction unless there was a          
satisfactory resolution of the issues raised in Goldman's written indication of 
interest regarding, among other things, conditions to closing, termination      
rights and the consequences of termination.                                     

During the first three weeks of April 1999, representatives of Goldman,   
together with its legal counsel, and representatives of the Company and members 
of the Board of Directors, together with Lehman Brothers and Willkie Farr &     
Gallagher, communicated by telephone and met in person to discuss various       
aspects of the proposed transaction. During this time, drafts of the Merger     
Agreement and the Voting Agreements (as defined below) were distributed,        
reviewed and negotiated. Among the matters negotiated were the conditions of    
the parties to close the Merger, the rights of the parties to terminate the     
Merger Agreement and the effect of termination. In addition, Goldman continued  
its due diligence investigation of the Company, the Company entered into a      
confidentiality agreement with Goldman covering information provided by Goldman 
and the Company's representatives discussed the terms of the proposed           
Commitments (as defined below) with Goldman's management and its lenders and    
counsel.                                                                        

  After the close of the markets on April 23, 1999, the Board of Directors met
to consider the merger transaction with Goldman and the proposed form of Merger 
Agreement. Following Lehman Brother's rendering of its oral opinion to the      
Board of Directors as to the fairness of the consideration to be received by    
the stockholders from a financial point of view, presentations by Willkie Farr  
& Gallagher and management, and the Board of Director's discussions and         
deliberations, the Board of Directors unanimously determined that the Merger    
was fair to, and in the best interest of, the holders of Common Stock.          
Accordingly, the Board of Directors unanimously approved the Merger Agreement   
and the Merger and resolved unanimously to recommend that the holders of Common 
Stock vote "FOR" the approval and adoption of the Merger Agreement and the      
Merger.                                                                         

Later that evening, the Merger Agreement was executed by the Company,     
Goldman and Merger Sub. For a detailed summary of the Merger Agreement, see     
"The Merger Agreement".                                                         

Reasons for the Merger; Recommendation of the Board of Directors                

In reaching its determination to recommend approval and adoption of the   
Merger Agreement and the Merger, the Board of Directors consulted with          
management, as well as Lehman Brothers, its financial advisor, and Willkie Farr 
& Gallagher, its legal advisor, and considered a number of factors, including   
those listed                                                                    

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below. In view of the wide variety of factors considered in connection with the 
Merger, the Board of Directors did not consider it practicable to, nor did it   
attempt to, quantify or otherwise assign relative weights to the specific       
factors it considered in reaching its decision.                                 

 (i) The Company's Business, Condition and Prospects. The Board of Directors
considered information with respect to the financial condition, results of      
operations and business of the Company, on both an historical and prospective   
basis, and current industry, economic and market conditions, including the      
Company's market position in the machine tools market. In particular, the Board 
of Directors considered that, throughout fiscal 1999, the Company experienced a 
significant decline in net incoming orders in the United States and the United  
Kingdom, the Company's two principal markets. Management had advised the Board  
of Directors that it believed that these declines represent a cyclical trend in 
these markets of declining purchases by customers for machine tools in the      
segment of the machine tool industry in which the Company participates. In the  
face of this decline in incoming orders, management of the Company advised the  
Board of Directors that it was unable to predict with certainty the period of   
time that the decreased level of customer purchases would continue, whether the 
level of customer purchases would decline further, or the level at which        
incoming orders would be. Management had reported to the Board of Directors in  
March 1999 that it anticipated that net sales in fiscal 2000 would be           
significantly lower than net sales in fiscal 1999 and that the Company would    
record a net loss in fiscal 2000.                                               

(ii) Historical and Recent Market Prices Compared to Consideration to be  
Received by Holders of Common Stock. The Board of Directors reviewed the        
historical market prices and trading information with respect to the Common     
Stock, and considered that (A) the price of $10.00 per share of Common Stock    
represented a premium of approximately 68% over the $5.969 closing price of the 
Common Stock on April 23, 1999 and (B) the price of $10.00 per share of Common  
Stock represented a 70% premium over the average closing price of the Common    
Stock for the 30 previous trading days prior to the April 23 Board of Directors 
meeting.                                                                        

(iii) Terms of the Merger. The Board of Directors considered the terms and
provisions of the Merger Agreement and related agreements, including the        
provision of the Merger Agreement permitting the Board of Directors to receive  
unsolicited inquiries and proposals from, and, under certain circumstances,     
negotiate and give information to, third parties. The Board of Directors        
further considered that the maximum aggregate termination fee that could be     
realized by Goldman pursuant to the Merger Agreement was $3.25 million (the     
"Termination Fee") and that the amount of the Termination Fee would be reduced  
by any fee payable by Textron under the terms of the Textron Voting Agreement   
(as defined below). Based on the advice of its financial and legal advisors,    
the Board of Directors concluded that the Termination Fee (which by its term is 
to be reduced by any fee payable by Textron in accordance with the terms of the 
Textron Voting Agreement was within the range of fees payable in comparable     
transactions and that it would not in and of itself preclude alternative        
proposals. The Board of Directors further considered that Goldman had stated    
that it would not enter into a transaction which did not include provisions     
similar to the Termination Fee.                                                 

 (iv) Opinion of Lehman Brothers. The Board of Directors considered the oral
opinion delivered on April 23, 1999 by Lehman Brothers that, as of the date of  
such opinion, and based upon and subject to certain matters stated therein, the 
consideration to be received by the holders of Common Stock in connection with  
the Merger was fair, from a financial point of view, to the holders of Common   
Stock. The Board of Directors also considered the oral and written presentation 
made to it by Lehman Brothers. See "The Merger--Opinion of the Company's        
Financial Advisor". Copies of the Lehman Brothers written opinion to the Board  
of Directors, dated April 23, 1999, which sets forth the assumptions made,      
matters considered and limitations on the review undertaken, is attached as     
Appendix E to this proxy statement and is incorporated herein by reference.     

(v) Principal Stockholders Support of the Merger Agreement. The Board of  
Directors considered that the Principal Stockholders, who hold, in the          
aggregate, approximately 40% of the outstanding Common Stock, were willing to   
grant to Goldman irrevocable proxies to vote all of the shares that they hold   
and all of the                                                                  

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shares over which they have voting control in favor of the adoption of the      
Merger Agreement and approval of the Merger.                                    

(vi) Merger Agreement Does Not Contain a Financing Condition. The Board of
Directors considered that Goldman's obligation to consummate the Merger would   
not be subject to a financing condition and that Goldman had delivered to the   
Company copies of letters from the lenders evidencing the Commitments and       
represented to the Company in the Merger Agreement that, upon receipt of the    
funds available under the Commitments, it would have sufficient funds to pay    
the aggregate Merger Consideration (as defined below).                          

The Board of Directors has unanimously approved the Merger Agreement, has 
determined that the Merger is fair to, advisable and in the best interests of,  
the Company and the holders of Common Stock, and recommends that stockholders   
vote "FOR" approval and adoption of the Merger Agreement and the Merger.        

Projections                                                                     

In the course of discussions giving rise to the Merger Agreement,         
representatives of the Company furnished representatives of Goldman with        
certain business and financial information that was not publicly available,     
including certain financial projections for fiscal year 2000 (the               
"Projections"). The Projections were prepared solely for the Company's internal 
purposes and were not prepared for publication or with a view to complying with 
the published guidelines of the Securities and Exchange Commission regarding    
projections or with the American Institute of Certified Public Accountants      
Guide for Prospective Financial Statements, and such information is being       
included in this proxy statement solely because it was furnished to Goldman in  
connection with the discussions giving rise to the Merger Agreement. The        
independent accountants of the Company have neither examined nor compiled the   
prospective financial information set forth below and, accordingly, do not      
express an opinion or any other form of assurance with respect thereto. The     
report of such independent accountants incorporated by reference in this proxy  
statement relate to the historical financial information of the Company and do  
not extend to the prospective financial information and should not be read to   
do so.                                                                          

The Projections set forth below necessarily reflect numerous assumptions  
with respect to general business and economic conditions and other matters,     
many of which are inherently uncertain or beyond the Company or Goldman's       
control, and do not take into account any changes in the Company's operations   
or capital structure which may result from the Merger. It is not possible to    
predict whether the assumptions made in preparing the projected financial       
information will be valid, and actual results may prove to be materially higher 
or lower than those contained in the projections. In addition to the specific   
assumptions relating to the Projections set forth below, certain other          
information pertinent to the Projections was furnished by the Company. The      
inclusion of this information should not be regarded as an indication that the  
Company, Goldman or anyone else who received this information considered it a   
reliable predictor of future events, and this information should not be relied  
on as such. None of the Company, Goldman or any of their respective             
representatives assumes any responsibility for the validity, reasonableness, or 
completeness of the projected financial information, and the Company has made   
no representation to Goldman or Merger Sub regarding such information.          

                                                                [Download Table]

                                                              Year Ended  
                                                               April 1,   
                                                                 2000     
                                                            --------------
                                                            (In thousands)
                                                                          
Net Sales..................................................    $139,470   
Pretax Loss................................................       3,147   
Net Loss...................................................       2,998   

The major assumptions made by the Company with respect to the Projections 
and conveyed to Goldman were as follows. The level of sales for the first six   
months of the Projections is based upon judgments of the                        

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Company management with respect to the level of incoming orders for December    
1998 through February 1999 and the assumption that business conditions would    
not improve during that six-month period. The second six months of the          
Projections assume an improvement in the level of business. In addition, the    
Projections assume no tax benefit would be established for net operating losses 
generated in fiscal 2000 for the Company's operations in the United Kingdom.    

Opinion of the Company's Financial Advisor                                      

  Lehman Brothers acted as financial advisor to the Company in connection with
the sale of the Company. On April 23, 1999, at a meeting of the Board of        
Directors, Lehman Brothers rendered its oral opinion to the Board that, as of   
such date, and based upon and subject to certain matters stated in Lehman       
Brothers written opinion, the consideration to be received by the stockholders  
of the Company in the sale of the Company was fair, from a financial point of   
view, to the Company's stockholders. Lehman Brothers subsequently confirmed its 
oral opinion by delivery of its written opinion dated April 23, 1999.           

The full text of the Lehman Brothers' opinion dated April 23, 1999 is     
included in Appendix E to this proxy statement and is incorporated in this      
document by reference. The summary of the Lehman Brothers' opinion set forth in 
this proxy statement is qualified in its entirety by reference to the full text 
of the Lehman Brothers' opinion. Holders of Common Stock may read the Lehman    
Brothers' opinion in its entirety for the procedures followed, factors          
considered, assumptions made and qualifications and limitations of the review   
undertaken by Lehman Brothers in connection with its opinion.                   

 No limitations were imposed by the Company on the scope of Lehman Brothers'
investigation or the procedures to be followed by Lehman Brothers in rendering  
its opinion except that the Company did not authorize Lehman Brothers to        
solicit, and Lehman Brothers did not solicit, any indications of interest from  
any third party with respect to the purchase of all or a part of the Company's  
business. Lehman Brothers was not requested to and did not make any             
recommendation to the Board of Directors as to the form or amount of the        
consideration to be offered to the Company's stockholders in the sale of the    
Company, which was determined through arm's length negotiations between the     
parties and their advisors. Lehman Brothers' advisory services and opinion were 
provided for the information and assistance of the Board of Directors in        
connection with its consideration of the sale of the Company. Lehman Brothers'  
opinion is not intended to be and does not constitute a recommendation to any   
stockholder of the Company as to how such stockholder should vote with respect  
to the sale of the Company. Lehman Brothers was not requested to opine as to,   
and its opinion does not address, the Company's underlying business decision to 
proceed with or effect the sale of the Company.                                 

In arriving at its opinion, Lehman Brothers reviewed and analyzed:        

.the Merger Agreement and the specific terms of the sale of the Company;

.publicly available information concerning the Company as it believed to
be relevant to its analysis;                                    

.financial and operating information with respect to the business,      
operations and prospects of the Company furnished to it by the  
Company;                                                        

.a trading history of the Common Stock from January 1, 1996 to the      
present and a comparison of that trading history with those of  
companies that it deemed relevant;                              

.a comparison of the historical financial results and present financial 
     condition of the Company with those of other companies that it deemed
relevant; and                                                   

.a comparison of the financial terms of the sale of the Company with the
financial terms of certain other transactions that it deemed    
relevant.                                                       

In addition, Lehman Brothers had discussions with the management of the   
Company concerning its business, operations, assets, financial condition and    
prospects and undertook such other studies, analyses and investigations as it   
deemed appropriate.                                                             

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In arriving at its opinion, Lehman Brothers assumed and relied upon the   
accuracy and completeness of the financial and other information used by it     
without assuming any responsibility for independent verification of such        
information. Lehman Brothers further relied upon the assurances of the          
management of the Company that they were not aware of any facts or              
circumstances that would make such information inaccurate or misleading. With   
respect to the financial projections of the Company, upon advice of the         
Company, Lehman Brothers assumed that such projections were reasonably prepared 
on a basis reflecting the best currently available estimates and judgments of   
the management of the Company as to their future financial performance of the   
Company and that the Company would perform in accordance with such projections. 
In arriving at its opinion, Lehman Brothers conducted only a limited physical   
inspection of the properties and facilities of the Company and did not make or  
obtain any evaluations or appraisals of the assets or liabilities of the        
Company. In addition, the Board of Directors did not authorize Lehman Brothers  
to solicit, and Lehman Brothers did not solicit, any indications of interest    
from any third party with respect to the purchase of all or a part of the       
Company's business. Lehman Brothers' opinion was necessarily based upon market, 
economic and other conditions as they existed on, and could be evaluated as of, 
the date of such opinion.                                                       

  In arriving at its opinion, Lehman Brothers did not ascribe a specific range
of value to the Company stockholders, but rather made its determination as to   
the fairness, from a financial point of view, of the consideration to be        
received by the stockholders of the Company in the sale of the Company on the   
basis of financial and comparative analyses described below. The preparation of 
a fairness opinion involves various determinations as to the most appropriate   
and relevant methods of financial and comparative analysis and the application  
of those methods to the particular circumstances, and therefore, such an        
opinion is not readily susceptible to summary description. Furthermore, in      
arriving at its opinion, Lehman Brothers did not attribute any particular       
weight to any analysis or factor considered by it, but rather made qualitative  
judgments as to the significance and relevance of each analysis and factor.     
Accordingly, Lehman Brothers believes that its analyses must be considered as a 
whole and that considering any portion of such analyses and factors, without    
considering all analyses and factors as a whole, could create a misleading or   
incomplete view of the process underlying its opinion. In its analyses, Lehman  
Brothers made numerous assumptions with respect to industry performance,        
general business and economic conditions and other matters, many of which are   
beyond the control of the Company. None of the Company, Lehman Brothers or any  
other person assumes responsibility if future results are materially different  
from those discussed. Any estimates contained in these analyses were not        
necessarily indicative of actual values or predictive of future results or      
values, which may be significantly more or less favorable than as set forth     
therein. In addition, analyses relating to the value of businesses do not       
purport to be appraisals or to reflect the prices at which businesses actually  
may be sold.                                                                    

The following is a summary of the material financial and comparative      
analyses used by Lehman Brothers in connection with rendering its opinion to    
the Board of Directors. Certain of the summaries of the financial and           
comparative analyses include information presented in tabular format. In order  
to fully understand the methodologies used by Lehman Brothers and the results   
of its financial and comparative analyses, the tables must be read together     
with the text of each summary. The tables alone do not constitute a complete    
description of the financial and comparative analyses. In particular, you       
should note that in applying the various valuation methods to the particular    
circumstances of the Company, Lehman Brothers made qualitative judgments as to  
the significance and relevance of each analysis and factor. In addition, Lehman 
Brothers made numerous assumptions with respect to industry performance,        
general business and economic conditions and other matters, many of which are   
beyond the control of the Company. Accordingly, the information presented in    
the tables and described below must be considered as a whole. Considering any   
portion of such analyses and of the factors considered, without considering all 
analyses and factors as a whole, could create a misleading or incomplete view   
of the process underlying Lehman Brothers' opinion.                             

Purchase Price Ratio Analysis. The purchase price ratio analysis provides 
enterprise value multiples and equity value multiples of key operating          
statistics for a range of transaction values. The total implied equity value to 
be received by holders of Common Stock is $57.0 million based upon the offer    
price of $10.00 per share, which represents a premium of 68% over the closing   
price of the Company shares of $5.969 on April 23,                              

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1999, the last trading day prior to announcement. Over the 52-week period ended 
April 23, 1999, the Common Stock traded at a low of $4.688 per share on March   
15, 1999 and at a high of $13.250 per share on April 22, 1998, representing a   
113% premium and a 25% discount, respectively, with respect to the $10.00 per   
share offer price. The Common Stock has not traded at or above $10.00 per share 
since September 4, 1998.                                                        

  Based on the offer price per share of $10.00, Lehman Brothers calculated the
ratio of implied equity value to net income as well as the ratio of the         
transaction value to revenue, earnings before interest and taxes ("EBIT") and   
earnings before interest, taxes, depreciation and amortization ("EBITDA")       
derived from the Company's financial projections. The Company's transaction     
value was obtained by adding the implied equity value and short- and long-term  
debt and subtracting its cash and cash equivalents. The following table         
presents (i) the ratios of the $10.00 offer price per share to the latest       
twelve months ("LTM") ended January 2, 1999, estimated fiscal year 1999 and     
projected fiscal year 2000 net income, (ii) the ratio of equity value to book   
value as of February 27, 1999 and (iii) the ratios of transaction value to the  
latest twelve months ended January 2, 1999, estimated fiscal year 1999 and      
projected fiscal year 2000 revenue, EBITDA and EBIT.                            

                                                                [Download Table]

                                                                Proposed  
Offer Price Per Share as Multiple of:                          Transaction
-------------------------------------                          -----------
                                                                          
LTM   Net Income..............................................    29.3x   
1999E  Net Income.............................................     8.3x   
2000E  Net Income.............................................      NM*   

Equity Value as a Multiple of:                                            
------------------------------                                            

Book Value (2/27/99)                                              0.84x   

Transaction Value as a Multiple of:                                       
-----------------------------------                                       

LTM   Revenue.................................................    0.36x   
1999E  Revenue................................................    0.39x   
2000E  Revenue................................................    0.50x   
LTM   EBITDA..................................................     7.4x   
1999E  EBITDA.................................................    12.8x   
2000E  EBITDA.................................................       NM*  
LTM   EBIT....................................................    12.0x   
1999E  EBIT...................................................       NM*  
2000E  EBIT...................................................       NM*  

--------                                                              
* "NM" means "not meaningful".                                        

In addition, Lehman Brothers compared the stock price performance of the  
Company with selected comparable publicly-traded companies, which included      
DeVlieg-Bullard, Inc., Hardinge, Inc., Hurco Companies, Inc. and Monarch        
Machine Tool Co., and with the S&P 400 Industrials Index.                       

 Comparable Publicly-Traded Company Analysis. The comparable publicly-traded
company analysis provides a market valuation benchmark based on the common      
stock trading multiples of selected comparable publicly-traded companies. For   
this analysis, Lehman Brothers reviewed the public stock market trading         
multiples for selected companies that Lehman Brothers deemed comparable to the  
Company. The selected comparable publicly-traded companies included DeVlieg-    
Bullard, Inc.; Hardinge, Inc.; Hurco Companies, Inc.; and Monarch Machine Tool  
Co. Using publicly available information, Lehman Brothers calculated and        
analyzed the common equity market value multiples of certain historical and     
projected financial criteria (such as net income) and the enterprise value      
multiples of certain historical financial criteria (such as revenues, EBITDA    
and EBIT) as of April 22, 1999, the last trading day prior to the Board of      
Directors meeting on April 23, 1999 (at which time the sale of the Company was  
considered) and two trading days prior to the                                   

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announcement of the sale of the Company. Net income for the selected companies  
was based on research analysts' estimates published on First Call, a service    
reporting equity analyst estimates.                                             

  The following table presents median multiples for equity value as a multiple
of net income for the calendar year ending December 31, 1999 and December 31,   
2000 and enterprise value as a multiple of LTM revenue, EBITDA and EBIT         
multiples.                                                                      

                                                                [Download Table]

                                                                 Median   
Equity Value Multiples:                                        Comparables
-----------------------                                        -----------
                                                                          
LTM   Net Income..............................................    7.1x    
1999E  Net Income.............................................   10.9x    
2000E  Net Income.............................................   10.3x    

Enterprise Value Multiples:                                               
---------------------------                                               

LTM   Revenue.................................................    0.46x   
LTM   EBITDA..................................................    6.3x    
LTM   EBIT....................................................    7.6x    

Because of the inherent differences between the businesses, operations,   
financial conditions and prospects of the Company and the businesses,           
operations, financial conditions and prospects of the companies included in the 
comparable company group, Lehman Brothers believed that it was inappropriate    
to, and therefore did not, rely solely on the quantitative results of the       
analysis, and accordingly, also made qualitative judgments concerning           
differences between the financial and operating characteristics of the Company  
and companies in the comparable company group that would affect the public      
trading values of the Company and such comparable companies.                    

Comparable Transaction Analysis. The comparable transaction analysis      
provides a market benchmark based on the consideration paid in selected         
comparable transactions. For this analysis, Lehman Brothers reviewed publicly   
available information to determine the purchase prices and multiples paid in    
certain transactions that were publicly announced in the machine tool           
manufacturing industry involving target companies which were similar to the     
Company in terms of business mix, product portfolio and/or markets served.      
These transactions include UNOVA, Inc.'s acquisition of Cincinnati Milacron's   
machine tool unit; Capitalmarket plc's acquisition of B. Elliott plc; Cooper    
Industries, Inc.'s acquisition of Global Industrial Technologies' INTOOL        
division; DLJ Merchant Banking Partners II's acquisition of Thermadyne Holdings 
Corp.; and Thyssen AG's acquisition of Giddings & Lewis, Inc.                   

Lehman Brothers calculated the enterprise value of the selected relevant  
transactions (calculated as the consideration offered for the common equity and 
short- and long-term debt and subtracting the enterprise's cash and cash        
equivalents), and applied it to certain historical financial criteria           
(including revenue, EBITDA and EBIT) of the acquired business for the LTM       
period. The most recent transaction in the machine tool manufacturing industry  
which Lehman Brothers believed is most relevant to the sale of the Company is   
UNOVA, Inc.'s acquisition of the machine tool unit of Cincinnati Milacron Inc.  
The multiples of enterprise value to LTM revenue, EBITDA and EBIT for that      
transaction were 0.38x, 7.0x and 11.6x, respectively. In comparison, the        
comparable multiples for the sale of the Company were 0.36x, 7.4x and 12.0x,    
respectively. In Lehman Brothers' judgment, the most relevant enterprise value  
multiples for the machine tool manufacturing industry are EBITDA and EBIT given 
the cyclicality of the machine tool manufacturing industry. The median ratios   
of enterprise value to LTM EBITDA and EBIT for all selected machine tool        
manufacturing industry transactions for the selected period were 8.0x and       
11.2x, respectively.                                                            

 Discounted Cash Flow Analysis. The discounted cash flow analysis provides a
net present valuation of management projections of the projected after-tax      
unlevered free cash flows (defined as operating cash flow                       

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available after changes in working capital, capital spending, tax and other     
operating requirements) based upon the Company's financial projections and      
Lehman Brothers' estimates.                                                     

                                                                [Download Table]
                                                                  
Base Case          A scenario based on forecasts of the Company   
                   management and Lehman Brothers reflecting the  
                   cyclicality of sales growth and EBIT margins   
                   based on the historical performance of the     
                   Company                                        
Conservative Case  A scenario based on certain adjustments to the 
                   Base Case forecasts; assumes lower sales growth
                   and lower EBIT margins than in the Base Case   
Upside Case        A scenario based on certain adjustments to Base
                   Case forecasts; assumes higher sales growth and
                   higher EBIT margins than in the Base Case      

Utilizing these three financial forecast scenarios, Lehman Brothers       
calculated a range of present values for the Company using a range of after-tax 
discount rates from 11% to 13% and a terminal value based upon a range of       
multiples of estimated EBITDA in 2003 from 6.0x to 8.0x.                        

  The following table presents the range of implied equity values per share of
Common Stock indicated by this analysis.                                        

                                                                [Download Table]

                                                 Implied Equity Value Per  
                                                 Share of the Common Stock 
                                                 ------------------------- 
                                                     Low          High     
                                                 ------------ -------------
                                                                           
Base Case....................................... $       7.47 $      10.01 
Conservative Case............................... $       4.97 $       6.48 
Upside Case..................................... $      10.37 $      14.12 

Lehman Brothers is an internationally recognized investment banking firm  
and, as part of its investment banking activities, is regularly engaged in the  
valuation of businesses and their securities in connection with mergers and     
acquisitions, negotiated underwritings, competitive bids, secondary             
distributions of listed and unlisted securities, private placements and         
valuations for corporate and other purposes. The Board of Directors selected    
Lehman Brothers because of its expertise, reputation and familiarity with the   
Company and because its investment banking professionals have substantial       
experience in transactions comparable to the sale of the Company.               

As compensation for its services as financial advisor to the Company in   
connection with the sale of the Company, the Company has paid to Lehman         
Brothers a retainer of $50,000 and a fee of $250,000 upon delivery of its       
fairness opinion and has agreed to pay Lehman Brothers a fee of 1.125% of the   
total consideration (including the Company's total debt less cash and           
marketable securities) involved in the sale of the Company upon closing of the  
sale, from which the opinion fee will be deducted. In addition, the Company has 
agreed to reimburse Lehman Brothers for reasonable out-of-pocket expenses       
incurred in connection with, and to indemnify Lehman Brothers for certain       
liabilities that may arise out of, its engagement by the Company and its        
rendering of its opinion. Lehman Brothers has previously rendered investment    
banking services to the Company and received customary fees for such services.  

In the ordinary course of its business, Lehman Brothers may actively trade
in the equity securities of the Company for its own account and for the         
accounts of its customers and, accordingly, may at any time hold a long or      
short position in such securities. Mr. Eliot Fried, a Managing Director of      
Lehman Brothers, is a director of the Company. In addition, affiliates of       
Lehman Brothers own approximately 639,935 shares of the Common Stock.           

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Certain Federal Income Tax Consequences of the Merger                           

 The following discussion describes certain United States federal income tax
consequences of the Merger. The discussion is based upon the Internal Revenue   
Code of 1986, as amended (the "Code"), existing and proposed Treasury           
regulations promulgated thereunder, rulings, administrative pronouncements and  
judicial decisions, changes to which could materially affect the tax            
consequences described herein and could be made on a retroactive basis. This    
discussion does not address all aspects of federal income taxation that may be  
important to a stockholder based on such holder's particular circumstances and  
does not address any aspect of state, local or foreign tax laws. This summary   
generally considers only shares of Common Stock that are held as capital assets 
(generally, assets held for investment) and may not apply to holders who        
acquired Common Stock pursuant to the exercise of employee stock options or     
other compensation arrangements with the Company, holders that are subject to   
special tax treatment (such as broker-dealers, insurance companies, tax-exempt  
organizations, financial institutions, and regulated investment companies),     
holders that hold Common Stock as part of a "straddle", "hedge", or "conversion 
transaction", or holders the functional currency of which is not the U.S.       
dollar.                                                                         

Consequences to Holders of Common Stock. A holder of Common Stock will    
recognize gain or loss equal to the difference between the amount of cash       
received in the Merger and the holder's adjusted tax basis in the shares of     
Common Stock exchanged. Such gain or loss will generally be capital gain or     
loss and will be long-term capital gain or loss if at the Effective Time (as    
defined below) the holder has a holding period for the Common Stock of more     
than one year.                                                                  

Backup Withholding and Information Reporting. Payments of cash to a holder
surrendering shares of Common Stock will be subject to information reporting    
and "backup" withholding at a rate of 31% of the cash payable to the holder,    
unless the holder furnishes its taxpayer identification number in the manner    
prescribed in applicable Treasury Regulations, certifies that such number is    
correct, certifies as to no loss of exemption from backup withholding and meets 
certain other conditions. Any amounts withheld from payments to a holder under  
the backup withholding rules will be allowed as a refund or credit against the  
holder's United States federal income tax liability, provided the required      
information is furnished to the Internal Revenue Service.                       

The preceding discussion does not purport to be a complete analysis or    
discussion of all potential tax effects relevant to the Merger. Thus,           
stockholders are urged to consult their own tax advisors as to the specific tax 
consequences to them of the Merger, including tax return reporting              
requirements, the applicability and effect of federal, state, local and other   
applicable tax laws and the effect of any proposed changes in the tax laws.     

Accounting Treatment of the Merger                                              

The Merger will be accounted for by Goldman as a purchase for financial   
reporting purposes.                                                             

Regulatory Filings and Approvals                                                

Antitrust. Under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended (the "HSR Act"), and the rules promulgated thereunder by the Federal 
Trade Commission (the "FTC"), the Merger cannot be consummated until            
notifications have been given and certain information has been furnished to the 
FTC and the Antitrust Division of the Department of Justice (the "Antitrust     
Division") and specified waiting period requirements have been satisfied. Each  
of the Company and Goldman filed notification and report forms under the HSR    
Act with the FTC and the Antitrust Division on May 6, 1999. Early termination   
of the waiting period was granted on May 24, 1999.                              

At any time before or after consummation of the Merger, the Antitrust     
Division or the FTC or any state could take such action under the antitrust     
laws as it deems necessary or desirable in the public interest, including       
seeking to enjoin the consummation of the Merger or seeking divestiture of      
substantial assets of the                                                       

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Company or Goldman. Private parties may also seek to take legal action under    
the antitrust laws under certain circumstances.                                 

There can be no assurance that the required regulatory approvals described
above will be received or, if received, the timing and the terms and conditions 
thereof.                                                                        

Financing Commitments                                                           

Goldman has obtained a commitment from Fleet Capital Corporation ("Fleet")
to establish a secured credit facility for up to $120,000,000 (the "Fleet       
Commitment") for the purpose of funding Goldman's purchase of the outstanding   
shares of Common Stock to be acquired in the Merger, refinancing the existing   
debt of the Company and the existing debt of Goldman's subsidiaries and         
providing working capital. The Fleet Commitment consists of a secured revolving 
credit facility for up to $90,000,000 and a secured term loan in the amount of  
$30,000,000. Goldman, its subsidiaries and the Company and its subsidiaries     
would be co-borrowers under this facility. The Fleet Commitment is subject to   
customary conditions, including no material adverse change in the conditions or 
operations, financial or otherwise, of Goldman, the Company or their respective 
subsidiaries.                                                                   

Goldman has also obtained the commitment of ING (U.S.) Capital LLC ("ING")
to provide secured bridge financing in an aggregate principal amount up to      
$30,000,000 (the "ING Commitment") for the purpose of funding Goldman's         
purchase of the outstanding shares of Common Stock to be acquired in the        
Merger, financing the payment of fees and expenses payable in connection with   
the Merger and repaying certain existing indebtedness of Goldman's subsidiaries 
and the Company. Goldman would be the borrower under this bridge facility. The  
ING Commitment is subject to customary conditions, including no material        
adverse change in the condition, financial or otherwise, business, operations   
or assets of Goldman, certain of its subsidiaries or the Company.               

 The Fleet Commitment and the ING Commitment are collectively referred to in
this proxy statement as the "Commitments".                                      

Goldman delivered to the Company copies of the letters from Fleet and ING 
evidencing the Commitments and represented to the Company in the Merger         
Agreement that, upon receipt of the funds available under the Commitments, it   
would have sufficient funds to pay the aggregate Merger Consideration.          
Goldman's obligation to consummate the Merger is not subject to any financing   
condition.                                                                      

Management, Operations and Ownership Structure Following the Merger             

Following the Merger, the Company will continue its operations as a wholly
owned indirect subsidiary of Goldman. The directors of Merger Sub will become   
the directors of the Company. At the Effective Time, Joseph E. Clancy, Chairman 
of the Board of Directors, and Dan L. Griffith, President and Chief Executive   
Officer of the Company, will be terminated without cause.                       

Appraisal Rights                                                                

 Under the DGCL, stockholders are entitled to appraisal rights in connection
with the Merger. Any holder of record of Common Stock that objects to the       
Merger (a "Dissenting Stockholder") may elect to have his or her shares of      
Common Stock appraised under the procedures of the DGCL and to be paid the      
appraised value of his or her shares. The appraised value of the shares will    
not include any value arising from the Merger but may include a fair rate of    
interest. It is possible that the fair value determined may be more or less     
than the Merger Consideration.                                                  

  Any stockholder who is considering exercising his or her appraisal rights is
urged to review carefully the provisions of Section 262 of the DGCL ("Section   
262"), a copy of which is attached as Appendix F to this proxy statement,       
particularly with respect to the procedural steps required to perfect the right 
of appraisal. The                                                               

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right of appraisal may be lost if the procedural requirements of Section 262    
are not followed exactly. The following is a summary of the procedures relating 
to exercise of the right of appraisal, which should be read in conjunction with 
the full text of Section 262.                                                   

Under Section 262, the Company is required to notify each stockholder     
entitled to appraisal rights at least 20 days prior to the Special Meeting that 
such appraisal rights are available. The notice must include a copy of Section  
262. This proxy statement constitutes such notice to the stockholders.          

  A stockholder electing to exercise his or her appraisal rights under Section
262 must deliver to the Company a written demand for appraisal before the vote  
is taken at the Special Meeting. The written demand must identify the           
stockholder and state that the stockholder intends to demand appraisal of his   
or her shares of Common Stock. A vote against the adoption of the Merger        
Agreement or an abstention will not constitute a demand for appraisal. A        
stockholder electing to take any of those actions must do so by a separate      
written demand to the Company. Demands should be mailed or delivered to         
Bridgeport Machines, Inc., 500 Lindley Street, Bridgeport, Connecticut, 06606,  
Attention: Secretary. Within 10 calendar days after the Effective Time, the     
Company will notify each stockholder who has made a proper written demand for   
appraisal and who has not voted for the adoption of the Merger Agreement that   
the Merger has been completed. A vote "FOR" the adoption of the Merger          
Agreement will have the effect of waiving all appraisal rights.                 

Within 120 calendar days after the Effective Time, the Company or any     
stockholder who has complied with the foregoing notice requirement and the      
other requirements of Section 262 may file a petition in the Delaware Court of  
Chancery (the "Court") demanding a determination of the fair value of his or    
her shares of Common Stock. The Company has no obligation to file a petition    
and does not currently intend to do so. As a result, any Dissenting Stockholder 
who wishes to file a petition is advised to do so on a timely basis. If a       
petition for appraisal is not filed during the 120-day period, all appraisal    
rights relating to the Common Stock will terminate. Any stockholder may         
withdraw a demand for appraisal at any time within 60 calendar days after the   
Effective Time (or thereafter with the written consent of the Company).         

  If a stockholder either withdraws his or her demand for appraisal or has his
or her appraisal rights terminated as described above, the stockholder will     
only be entitled to receive the Merger Consideration for his or her shares of   
Common Stock as provided under the terms of the Merger Agreement.               

Within 120 calendar days after the Effective Time, any stockholder who has
complied with the above-described notice requirements and the other             
requirements of Section 262 may request in writing a list of the aggregate      
number of shares of Common Stock for which demands for appraisal have been made 
and the aggregate number of holders demanding appraisal rights.                 

  If a petition is filed by a Dissenting Stockholder, the Company will receive
notice from the Court of such filing. Within 20 calendar days after the Company 
receives notice from the Court, the Company must file with the office of the    
Register in Chancery in which the petition was filed, a list containing the     
names and addresses of all stockholders who have demanded appraisal rights and  
the names of all stockholders who have disagreements with the Company regarding 
the value of their shares of Common Stock. If a petition is filed by the        
Company, the petition will be accompanied by a similar list. If ordered by the  
Court, the Register in Chancery will give notice of the time and place of the   
hearing by registered or certified mail to the Company and to each stockholder  
shown on the list. The notice will also be given by publishing the notice in a  
newspaper of general circulation published in Wilmington, Delaware (or any      
other location the Court may determine), at least one week before the hearing.  
The forms of the notices to be used will be approved by the Court, and all      
costs related to the distribution of the notices will be paid by the Company.   

After the Court determines which of the stockholders are entitled to an   
appraisal under Section 262, the Court will appraise the shares of the Common   
Stock. Following determination by the Court of the fair value of the shares,    
the Company will pay all Dissenting Stockholders the appraised value of their   
shares, together with interest, if any, upon surrender to the Company of their  
certificates representing the Common Stock. The costs                           

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of the appraisal proceeding may be determined by the Court and charged to the   
parties as the Court deems equitable in the circumstances. Upon application of  
a Dissenting Stockholder, the Court may order all or a portion of the expenses  
incurred by any Dissenting Stockholder in connection with the appraisal         
proceeding, including reasonable attorneys' fees and the fees and expenses of   
experts, to be charged pro rata against the value of all of the shares entitled 
to an appraisal.                                                                

After the Effective Time, no stockholder who has demanded his or her      
appraisal rights as set forth above will be entitled to vote his or her shares  
for any purpose or to receive payment of dividends or other distributions on    
his shares (except dividends or other distributions payable to stockholders of  
record at a date prior to the Effective Time).                                  

Public Trading Market                                                           

  The Common Stock is currently traded on the Nasdaq National Market under the
trading symbol "BPTM". Upon consummation of the Merger, the Common Stock will   
no longer be traded on the Nasdaq National Market and will be deregistered      
under the Exchange Act.                                                         

THE MERGER AGREEMENT

The following describes certain aspects of the proposed Merger, including 
material provisions of the Merger Agreement. The following description of the   
Merger does not purport to be complete and is qualified in its entirety by      
reference to the Merger Agreement, which is attached as Appendix A to this      
proxy statement and is incorporated herein by reference. Holders of Common      
Stock are urged to read the Merger Agreement carefully. Capitalized terms used  
in this section or elsewhere in this proxy statement but not defined in this    
proxy statement have the meanings attributed to them in the Merger Agreement.   

General; Merger Consideration                                                   

The terms of the Merger are set forth in the Merger Agreement. The Merger 
Agreement was approved by the Board of Directors and signed by the Company,     
Goldman and Merger Sub on April 23, 1999. Pursuant to the Merger Agreement, and 
on the terms and conditions set forth therein, at the Effective Time, Merger    
Sub will be merged with and into the Company, and the Company will be the       
surviving corporation (the "Surviving Corporation"). As a result of the Merger, 
each share of Common Stock issued and outstanding immediately prior to the      
Effective Time (other than shares owned by the Company, Goldman, Merger Sub or  
any subsidiary thereof or shares with respect to which the holders have         
perfected appraisal rights under the DGCL (collectively, the "Excluded          
Shares")) will be converted into the right to receive $10.00 in cash, without   
interest (the "Merger Consideration").                                          

Dissenting Shares                                                               

In the Merger, stockholders have appraisal rights under Section 262 of the
DGCL. If a stockholder exercises his or her appraisal rights and complies with  
the requirements of Section 262, the shares of Common Stock owned by the        
Dissenting Stockholder will not be converted into the right to receive the      
Merger Consideration at the Effective Time. Instead, such Dissenting            
Stockholder will receive the appraisal value of his or her shares of Common     
Stock (the "Dissenting Shares"). If after the Effective Time, the Dissenting    
Stockholder fails to comply with the requirements of Section 262, the           
Dissenting Shares of such Dissenting Stockholder will be treated as shares of   
Common Stock and will be converted into the right to receive the Merger         
Consideration. At the Effective Time, a Dissenting Stockholder will not have    
any rights (including voting rights and rights to dividends or distributions)   
with respect to his or her Dissenting Shares other than rights provided by      
Section 262. For a summary of the requirements that a stockholder must follow   
in order to exercise his or her appraisal rights, see "The Merger--Appraisal    
Rights".                                                                        

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Treatment of Stock Options                                                      

The Company will use its reasonable efforts to provide for the return and 
cancellation of each outstanding option to acquire Common Stock (an "Option")   
in exchange for an amount in cash equal to the product of (A) the excess, if    
any, of $10.00 over the exercise price of each such Option and (B) the number   
of shares subject to the Option. Substantially all of the Options outstanding   
have exercise prices in excess of $10.00 per share.                             

Closing; Effective Time                                                         

The closing of the Merger (the "Closing") will take place by the third    
business day following the satisfaction or waiver of the conditions to the      
Merger set forth in the Merger Agreement, unless otherwise agreed by the        
parties. Concurrently with the Closing, the Company, Goldman and Merger Sub     
will cause a Certificate of Merger to be executed, acknowledged and filed with  
the Secretary of State of the State of Delaware. The Merger will become         
effective at the time the Certificate of Merger is duly filed with the          
Secretary or at such later time agreed by the parties (the "Effective Time").   
See "--Conditions to the Proposed Merger" and "The Merger--Regulatory Filings   
and Approvals".                                                                 

Cancellation of Shares                                                          

At the Effective Time, all shares of Common Stock will no longer be       
outstanding and will be canceled and retired and will cease to exist, and each  
certificate (a "Certificate") formerly representing any of such shares (other   
than Excluded Shares) will thereafter represent only the right to receive the   
Merger Consideration.                                                           

Exchange of Certificates                                                        

  Prior to the Effective Time, Goldman will designate a bank, trust company or
other Person reasonably acceptable to the Company to act as agent (the "Paying  
Agent") for the benefit of the holders of shares of Common Stock to receive the 
funds to which holders of shares of Common Stock become entitled upon surrender 
of their Certificates. Upon surrender of a Certificate to the Paying Agent      
together with a signed letter of transmittal, duly executed, Goldman will cause 
the Paying Agent to pay to the holder of such Certificate in exchange therefor  
the Merger Consideration for each share formerly represented by such            
Certificate and the Certificate surrendered will then be canceled. No interest  
will be paid or accrued on any amount payable upon due surrender of a           
Certificate.                                                                    

Transfers                                                                       

At the Effective Time, the stock transfer books of the Company will be    
closed and thereafter there will be no further registration of transfers of     
shares of Common Stock on the records of the Company.                           

Lost, Stolen or Destroyed Certificates                                          

In the event any Certificate is lost, stolen or destroyed, upon the making
of an affidavit of that fact by the stockholder claiming such Certificate to be 
lost, stolen or destroyed and, if required by the Surviving Corporation or      
Goldman, the posting by such stockholder of a bond in customary amount as       
indemnity against any claim that may be made against it with respect to such    
Certificate, the Paying Agent will issue in exchange for such lost, stolen or   
destroyed Certificate the applicable Merger Consideration such stockholder is   
entitled to receive pursuant to the Merger Agreement.                           

Representations and Warranties                                                  

  Mutual Representations and Warranties. The Merger Agreement contains various
representations and warranties of the parties relating to and including, among  
other things: (a) organization and similar corporate matters and subsidiaries;  
(b) authorization, execution, delivery, performance and enforceability of the   
Merger                                                                          

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Agreement and related matters; (c) conflicts with governing documents or law;   
(d) required consents or approvals; (e) information supplied in this proxy      
statement; and (f) brokers.                                                     

Additional Representations and Warranties of Goldman. Goldman has         
additionally represented and warranted, among other things, that it has         
obtained the Commitments sufficient to fund the payment of the Merger           
Consideration for the shares of Common Stock to be acquired pursuant to the     
Merger.                                                                         

Additional Representations and Warranties of the Company. The Company has 
made additional representations and warranties relating to, among other things: 
(a) capitalization; (b) its filings with the Securities and Exchange            
Commission; (c) the absence of certain changes or events; (d) litigation; (e)   
retirement and other employee plans and matters relating to the Employee        
Retirement Income Security Act of 1974, as amended ("ERISA") and the absence of 
changes thereto; (f) the filing of tax returns and other tax matters; (g) non-  
deductible payments triggered by the Merger; (h) compliance with applicable     
laws, including environmental regulations; (i) ownership of intellectual        
property; (j) owned and lease real property; (k) contracts and commitments; (l) 
labor relations; (m) claims against the Company for products liability; (n)     
transactions with affiliates; (o) compliance with Section 203 of the DGCL; (p)  
approval by stockholders; (q) the opinion of Lehman Brothers; (r) the           
sufficiency of the disclosure in the disclosure schedules to the Merger         
Agreement; and (s) Year 2000 compliance.                                        

Conduct of Business Prior to the Merger                                         

The Company has agreed as to itself and, where indicated, each of its     
Subsidiaries, that after the date of the Merger Agreement and prior to the      
Effective Time (except as expressly provided in the Merger Agreement or as      
Goldman otherwise agrees in writing) that:                                      

(a)it and its Subsidiaries will conduct their respective businesses in
the ordinary course;                                            

(b)it and its Subsidiaries will use all reasonable best efforts         
consistent with good business judgment to preserve their business 
   organizations intact, to keep available the services of their current
officers and key employees and to preserve their relationships    
consistent with past practice with desirable customers, suppliers,
 licensors, licensees, distributors and other persons with which the
 Company or its Subsidiaries has business dealings so as to maintain
their goodwill and ongoing businesses;                            

(c)neither it nor its Subsidiaries will amend or modify the Certificate 
of Incorporation, By-laws or similar organizational documents;    

(d)neither it nor its Subsidiaries will declare, set aside or pay any   
  dividend or other distribution payable in cash, stock or property in
 respect of any capital stock, with the exception of the declaration
  and payment of dividends or the making of other advances by a wholly
owned Subsidiary to its parent or the Company;                    

(e)neither it nor its Subsidiaries will redeem, purchase or otherwise   
acquire directly or indirectly any shares of the Company's capital
stock or that of its Subsidiaries;                                

(f)neither it nor its Subsidiaries will issue, sell, pledge, dispose of 
  or encumber any additional shares of, or securities convertible into
or exchangeable for, or options, warrants, calls, commitments or  
rights of any kind to acquire, any shares of capital stock of any 
  class of the Company or its Subsidiaries, other than the issuance of
   shares of Common Stock upon the exercise of Options outstanding as of
the date of the Merger Agreement;                                 

(g)neither it nor its Subsidiaries will split, combine or reclassify the
   outstanding shares of the capital stock of the Company or that of any
of its Subsidiaries;                                              

(h)neither it nor its Subsidiaries will acquire or agree to acquire (A) 
by merging or consolidating with, or by repurchasing a substantial
portion of the assets of or by any other manner, any              

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 business or any corporation or other entity, or (B) any assets,
   including real estate, except purchases in the ordinary course of
 business consistent with past practice and capital expenditures
permitted by the Merger Agreement;                            

  (i)  neither it nor its Subsidiaries will make any new capital expenditure
     or expenditures in an aggregate amount exceeding $550,000 and which
    are set forth in the disclosure schedules to the Merger Agreement;

(j)  neither it nor its Subsidiaries will, except in the ordinary course
       of business and as otherwise permitted by the Merger Agreement, amend
or terminate any contract or agreement where such amendment or
     termination would have a Material Adverse Effect on the Company, or
waive, release or assign any material rights or claims;       

 (k)  neither it nor its Subsidiaries will transfer, lease, license, sell,
   mortgage, pledge, dispose of or encumber any material property or
  assets other than sales of sales of products to customers in the
ordinary course of business consistent with past practice;    

  (l)  neither it nor its Subsidiaries will (A) enter into any employment or
       severance agreement with or grant any severance or termination pay to
     any officer, director or key employee, or (B) hire or agree to hire
       any new or additional key employees or officer, except to fill vacant
positions specified in the disclosure schedules to the Merger 
Agreement;                                                    

(m)  neither it nor any of its Subsidiaries will make any changes to its
Benefit Plans;                                                

(n)  neither it nor its Subsidiaries will (A) incur or assume any long- 
  term indebtedness or, except in the ordinary course of business,
       incur or assume any short-term indebtedness (including advances under
  the Company's existing revolving credit facility) in amounts not
 consistent with past practice, (B) incur or modify any material
indebtedness or other liability, except as set forth in the   
disclosure schedules to the Merger Agreement, or (C) assume,  
      guarantee, endorse or otherwise become liable or responsible for the
obligations of any other Person;                              

(o)  neither it nor its Subsidiaries will make any loans, advances or   
     capital contributions to, or investments in, any other Person other
     than to wholly owned Subsidiaries of the Company or to the entities
listed on the disclosure schedules to the Merger Agreement or 
       customary loans or advances to employees or customers in the ordinary
course of business in accordance with past practice;          

(p)  neither it nor its Subsidiaries will enter into any material       
  commitment or transaction unless it is in the ordinary course of
business consistent with past practice and not specifically   
prohibited under the Merger Agreement;                        

  (q)  neither it nor its Subsidiaries will change its accounting principles
except as required by GAAP or the SEC;                        

(r)  neither it nor its Subsidiaries will make any tax election, unless 
      required by law, or settle or compromise any material tax liability;

(s)  neither it nor any of its Subsidiaries will pay, discharge or      
     otherwise satisfy any claims, liabilities or obligations other than
       (A) in the ordinary course of business consistent with past practice,
    (B) in connection with the transactions contemplated by the Merger
     Agreement, (C) which, in the aggregate, do not exceed $100,000, and
      (D) which are reflected, or reserved against in, or contemplated by,
the consolidated financial statements of the Company and its  
   Subsidiaries and which, in the aggregate, do not exceed $100,000;

(t)  neither it nor any of its Subsidiaries will, except in the ordinary
      course of business consistent with past practice, waive the benefits
       of, or agree to modify in any manner, any confidentiality, standstill
      or similar agreement to which the Company or any of its Subsidiaries
is a party; and                                               

(u)  neither it nor its Subsidiaries will authorize or enter into any   
agreement to take any of the foregoing actions.               

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Agreement Not to Solicit Other Offers                                           

The Company agreed that it will not, nor will it permit any of its        
Subsidiaries to, nor will it authorize (and it will use its reasonable efforts  
not to permit) any officer, director or employee of, or any investment banker,  
attorney or other advisor or representative of, the Company or any of its       
Subsidiaries to, (i) solicit or initiate, or encourage, directly or indirectly, 
the submission of, any Takeover Proposal (as defined below), (ii) participate   
in any discussions or negotiations regarding, or furnish to any Person any      
information or data with respect to, or take any other action to knowingly      
facilitate the making of any proposal that constitutes, or may reasonably be    
expected to lead to, any Takeover Proposal or (iii) enter into any agreement    
with respect to any Takeover Proposal or approve or resolve to approve any      
Takeover Proposal. However, the Company and the Board of Directors are not      
prohibited from (i) taking and disclosing to the Company's stockholders a       
position with respect to a tender or exchange offer by a third party pursuant   
to Rules 14d-9 and 14e-2 promulgated under the Exchange Act, or (ii) making     
such disclosure to the Company's stockholders as, in the good faith judgment of 
the Company's Board of Directors, after receiving advice from outside counsel,  
is required under applicable law, provided that the Company may not, except as  
permitted by the Merger Agreement, withdraw or modify, or propose to withdraw   
or modify, its position with respect to the Merger or approve or recommend, or  
propose to approve or recommend, any Takeover Proposal, or enter into any       
agreement with respect to any Takeover Proposal.                                

Upon execution of the Merger Agreement, the Company agreed to immediately 
cease any existing activities, discussions or negotiations with any parties     
conducted with respect to any Takeover Proposal. Notwithstanding the foregoing, 
prior to the Effective Time, the Company may furnish information concerning its 
business, properties or assets to any Person or group pursuant to               
confidentiality agreements with terms and conditions similar to the             
confidentiality agreement, dated as of January 19, 1999 (the "Confidentiality   
Agreement"), between the Company and Goldman, and may negotiate and participate 
in discussions and negotiations with such Person or group concerning a Takeover 
Proposal if (A) the Board of Directors determines in good faith, after          
receiving advice from its financial advisor, that such Person or group has      
submitted to the Company a Takeover Proposal which is reasonably likely to be a 
Superior Proposal; and (B) the Board of Directors determines in good faith,     
based upon advice of its outside legal counsel, that the failure to participate 
in such discussions or negotiations or to furnish such information is           
reasonably likely to result in a breach of such Board's fiduciary duties under, 
or otherwise violate, applicable law.                                           

The Company has agreed to promptly notify Goldman of the existence of any 
proposal, discussion, negotiation or inquiry received by the Company and        
immediately communicate to Goldman the terms of any proposal, discussion,       
negotiation or inquiry which it may receive (and promptly provide to Goldman    
copies of any written materials received by the Company in connection with such 
proposal, discussion, negotiation or inquiry) and the identity of the party     
making such proposal or inquiry or engaging in such discussion or negotiation,  
except to the extent that the Board of Directors determines in good faith,      
based upon advice of its outside legal counsel, that any such action described  
in this sentence would be reasonably likely to result in a breach of such       
Board's fiduciary duties under, or otherwise violate, applicable law. The       
Company is to promptly provide to Goldman any non-public information concerning 
the Company provided to any other Person which was not previously provided to   
Goldman. The Company will keep Goldman fully informed of the status and details 
(including amendments or proposed amendments) to any such Takeover Proposal,    
except to the extent that the Board of Directors determines in good faith,      
based upon advice of its outside legal counsel, that any such action would be   
reasonably likely to result in a breach of such Board's fiduciary duties under, 
or otherwise violate, applicable Law.                                           

For purposes of the Merger Agreement, "Takeover Proposal" means any bona  
fide proposal or offer, whether in writing or otherwise, from any Person other  
than Goldman, Merger Sub or any affiliates thereof (a "Third Party") to acquire 
beneficial ownership (as defined under Rule 13(d) of the Exchange Act) of all   
or a material portion of the assets of the Company and its Subsidiaries, taken  
as a whole, or 50% or more of any class of equity securities of the Company     
pursuant to a merger, consolidation or other business combination, sale of      
shares of capital stock, sale of assets, tender offer, exchange offer or        
similar transaction with respect to                                             

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the Company, including any single or multi-step transaction or series of        
related transactions, which is structured to permit such Third Party to acquire 
beneficial ownership of any material portion of the assets of the Company and   
its Subsidiaries, taken as a whole, or 50% or more of the equity interest in    
the Company.                                                                    

For purposes of the Merger Agreement, "Superior Proposal" means an        
unsolicited bona fide proposal by a Third Party to acquire, directly or         
indirectly, for consideration consisting of cash and/or securities, more than a 
majority of the Shares then outstanding or all or substantially all of the      
assets of the Company, and otherwise on terms (i) which the Board of Directors  
determines in good faith to be more favorable to the Company's stockholders by  
more than 110% than the Merger, (ii) based on advice of the Company's           
independent financial advisor, for which financing, to the extent required, is  
then committed or which, in the good faith reasonable judgment of the Board of  
Directors, based on advice from the Company's independent financial advisor, is 
reasonably capable of being financed by such Third Party, and (iii) which, in   
the good faith reasonable judgment of the Board of Directors, is reasonably     
capable of being consummated within a period of time not materially longer in   
duration than the period of time reasonably believed to be necessary to         
consummate the Merger.                                                          

Board Recommendations                                                           

In connection with the Merger and Special Meeting, the Board of Directors 
agreed to recommend to the holders of the Common Stock to vote in favor of the  
Merger and use all commercially reasonable efforts to obtain the necessary      
approvals by the holders of the Common Stock of the Merger Agreement, subject   
to fiduciary obligations under applicable law. Neither the Board of Directors   
nor any committee thereof shall (i) withdraw or modify, or propose to withdraw  
or modify, in a manner adverse to Goldman or Merger Sub, the approval or        
recommendation by the Board of Directors or any such committee of the Merger    
Agreement or the Merger, (ii) approve or recommend, or propose to approve or    
recommend, any Takeover Proposal or (iii) enter into any agreement with respect 
to any Takeover Proposal. Notwithstanding the foregoing, prior to the Effective 
Time, the Board of Directors may withdraw or modify its approval or             
recommendation of the Merger Agreement or the Merger, approve or recommend a    
Superior Proposal, or enter into an agreement with respect to a Superior        
Proposal, in each case at any time after the fifth business day following       
Goldman's receipt of written notice from the Company advising Goldman that the  
Board of Directors has received a Superior Proposal which it intends to accept, 
specifying the material terms and conditions of such Superior Proposal,         
identifying the person making such Superior Proposal.                           

Certain Other Covenants and Agreements                                          

 Access to Information; Confidentiality. The Merger Agreement provides that,
upon reasonable notice, the Company will (and will cause each of its            
Subsidiaries to) afford to the Representatives of Goldman, including the        
Persons providing the Commitments, reasonable access, during normal business    
hours during the period after the date of the Merger Agreement and prior to the 
Effective Time, to such of its properties, personnel, books, contracts,         
commitments and records as Goldman may reasonably request. During that period,  
the Company will (and will cause each of its Subsidiaries to) furnish promptly  
to Goldman (A) a copy of each report, schedule, registration statement and      
other document filed or received by it during such period pursuant to the       
requirements of Federal or state securities Laws, and (B) all other information 
concerning its business, properties and personnel as Goldman may reasonably     
request. Neither Goldman, its Representatives, nor any Person providing the     
commitment has the right to conduct any environmental boring, sampling,         
testing, or a Phase II review at any of the properties of the Company or its    
Subsidiaries provided that such restriction shall not limit Goldman's right to  
conduct any environmental investigation with respect to events occurring after  
the date of the Merger Agreement. Goldman will remain bound by the terms of the 
Confidentiality Agreement and the Company will remain bound by the terms of a   
confidentiality agreement with Goldman dated as of April 20, 1999.              

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 Notification of Certain Matters. The Merger Agreement provides that each of
the Company, Goldman and Merger Sub will give prompt notice to the other of (i) 
any of their representations or warranties contained in the Merger Agreement    
becoming untrue or inaccurate in any respect (including in the case of          
representations or warranties receiving knowledge of any fact, event or         
circumstance which may cause any representation qualified as to the knowledge   
to be or become untrue or inaccurate in any respect) or (ii) the failure by     
them to comply with or satisfy in any material respect any covenant, condition  
or agreement to be complied with or satisfied by them under the Merger          
Agreement. However, such notification shall not affect the representations,     
warranties, covenants or agreements of the parties or the conditions to the     
obligations of the parties under the Merger Agreement.                          

Reasonable Efforts. Upon the terms and subject to the conditions set forth
in the Merger Agreement, each of the parties has agreed to use all reasonable   
efforts to take, or cause to be taken, all actions, and to do, or cause to be   
done, and to assist and cooperate with the other parties in doing, all things   
necessary, proper or advisable to consummate and make effective, in the most    
expeditious manner practicable, the Merger and the other transactions           
contemplated by the Merger Agreement. These things include (i) the obtaining of 
all necessary actions or non-actions, waivers, consents and approvals from any  
Governmental Entity and the making of all necessary registrations and filings   
(including filings with any Governmental Entity, if any) and the taking of all  
reasonable steps as may be necessary to obtain an approval or waiver from, or   
to avoid an action or proceeding by any Governmental Entity, (ii) the obtaining 
of all necessary consents, approvals or waivers from third parties, (iii) the   
defending of any lawsuits or other legal proceedings, whether judicial or       
administrative, challenging the Merger Agreement or the consummation of any of  
the transactions contemplated by the Merger Agreement, including seeking to     
have any stay or temporary restraining order entered by any court or other      
Governmental Entity vacated or reversed, and (iv) the execution and delivery of 
any additional instruments necessary to consummate the transactions             
contemplated by, and to fully carry out the purposes of, the Merger Agreement.  
However, in connection with any filing or submission or other action required   
to be made or taken by any party to effect the Merger and all other             
transactions contemplated by the Merger Agreement, the Company may not, without 
the prior written consent of Goldman, commit to any divestiture transaction and 
Goldman shall not be required to divest or hold separate or otherwise take or   
commence to take any action that, in the reasonable discretion of Goldman,      
limits in any material respect its freedom of action with respect to, or its    
ability to retain, the Company or any of its affiliates or any material portion 
of the assets of the Company. In connection with and without limiting the       
foregoing, the Company and the Board of Directors are to (i) take all action    
necessary to ensure that no state takeover statute or similar statute or        
regulation is or becomes applicable to the Merger, the Merger Agreement or any  
of the other Transactions contemplated by the Merger Agreement and (ii) if any  
state takeover statute or similar statute or regulation becomes applicable to   
the Merger or the Merger Agreement or any other transaction contemplated by the 
Merger Agreement, take all action necessary to ensure that the Merger and the   
other Transactions contemplated by the Merger Agreement may be consummated as   
promptly as practicable on the terms contemplated by the Merger Agreement and   
otherwise to minimize the effect of such statute or regulation on the Merger,   
the Merger Agreement and the other transactions contemplated by the Merger      
Agreement.                                                                      

 Financing. Between the date of the Merger Agreement and the consummation of
the Merger, the Company agreed to cooperate, and to cause its Representatives   
to cooperate, in connection with the efforts of Goldman and Merger Sub to       
obtain the financing necessary to consummate the transactions contemplated by   
the Merger Agreement. However, the Company is not required to pay any fees or   
other costs with respect to that financing prior to the consummation of the     
Merger, and any agreements which the Company may enter into prior to the        
consummation of the Merger relating to the obtaining of that financing must be  
conditioned upon the occurrence of the consummation of the Merger.              

Indemnification of Directors and Officers; Directors and Officers'        
Insurance. The Certificate of Incorporation and By-laws of the Surviving        
Corporation are to contain the provisions with respect to indemnification and   
exculpation set forth in the Certificate of Incorporation and By-laws of the    
Company. These provisions may not be amended, repealed or otherwise modified in 
any manner that would adversely                                                 

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affect the rights thereunder of individuals who at the Effective Time were      
directors, officers, employees or agents of the Company, unless such            
modification is required by Law.                                                

 The Company agreed, to the fullest extent permitted under applicable Law or
under the Company's Certificate of Incorporation or By-laws and regardless of   
whether the Merger becomes effective, to indemnify and hold harmless, and,      
after the Effective Time, Goldman or the Surviving Corporation will, to the     
fullest extent permitted under applicable Law or under the Surviving            
Corporation's Certificate of Incorporation or By-laws, indemnify and hold       
harmless, each present and former director, officer or employee of the Company  
or any of its Subsidiaries (collectively, the "Indemnified Parties") against    
any costs or expenses (including attorneys' fees), judgments, fines, losses,    
claims, damages and liabilities incurred in connection with, and amounts paid   
in settlement of, any claim, action, suit, proceeding or investigation, whether 
civil, criminal, administrative or investigative and wherever asserted, brought 
or filed, (x) arising out of or pertaining to the Transactions or (y) otherwise 
with respect to any acts or omissions or alleged acts or omissions occurring at 
or prior to the Effective Time, to the same extent as provided in the           
respective Certificate of Incorporation or By-laws of the Company or its        
Subsidiaries as in effect on the date of the Merger Agreement. In the event of  
any such claim, action, suit, proceeding or investigation (whether arising      
before or after the Effective Time), (i) any counsel retained by the            
Indemnified Parties for any period after the Effective Time must be reasonably  
satisfactory to the Surviving Corporation, (ii) after the Effective Time,       
Goldman or the Surviving Corporation will pay the reasonable fees and expenses  
of such counsel, promptly after statements therefor are received, and (iii)     
Goldman or the Surviving Corporation will cooperate in the defense of any such  
matter; provided, however, that Goldman or the Surviving Corporation shall not  
be liable for any settlement effected without its written consent (which        
consent shall not be unreasonably withheld or delayed). The Indemnified Parties 
as a group may retain only one law firm to represent them with respect to any   
single action unless there is, under applicable standards of professional       
conduct, a conflict on any significant issue between the positions of any two   
or more Indemnified Parties. The indemnity agreements of Goldman and the        
Surviving Corporation will extend, on the same terms to, and shall inure to the 
benefit of and shall be enforceable by, each person or entity who controls, or  
in the past controlled, any present or former director, officer or employee of  
the Company or any of its Subsidiaries.                                         

For a period of six years after the Effective Time, Goldman will cause the
Surviving Corporation to maintain in effect, if available, directors' and       
officers' liability insurance covering those persons who are currently covered  
by the Company's directors' and officers' liability insurance policy on terms   
(including the amounts of coverage and the amounts of deductibles, if any) that 
are comparable to the terms now applicable to directors and officers of Goldman 
or, if more favorable to the Company's directors and officers, the terms now    
applicable to them under the Company's current policies. However, in no event   
will Goldman or the Surviving Corporation be required to expend in excess of    
150% of the annual premium currently paid by the Company for such coverage, and 
if the premium for such coverage exceeds such amount, Goldman or the Surviving  
Corporation must purchase a policy with the greatest coverage available for     
such 150% of the annual premium.                                                

Conditions to the Proposed Merger                                               

  Mutual Conditions. The obligation of each of the Company, Goldman and Merger
Sub to effect and consummate the Merger is conditioned on the following:        

(a)the approval and adoption of the Merger Agreement by the requisite   
   vote of the holders of Common Stock as is required by applicable law,
the Company's Certificate of Incorporation and its By-laws;       

(b)the expiration or termination of the waiting period applicable to the
consummation of the Merger under the HSR Act; and                 

(c)no Governmental Entity having enacted, promulgated or issued any     
statute, rule, regulation, order, decree or injunction precluding,
restraining, enjoining or prohibiting consummation of the Merger. 

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Additional Conditions to the Obligation of Goldman and Merger Sub. In     
addition, the obligation of Goldman and Merger Sub to effect and consummate the 
Merger under the Merger Agreement is subject to the following additional        
conditions:                                                                     

(a)the representations and warranties of the Company which are qualified
  as to materiality shall be true and correct when made on the date of
    the Merger Agreement and shall be true and correct as of the Effective
Time as if made as of the Effective Time, except for those        
  representations and warranties which are qualified as to materiality
    and are made as of a specific date, which shall be true and correct as
   of such date; the other representations and warranties of the Company
    which are not so qualified as to materiality shall be true and correct
    in all material respects when made on the date of the Merger Agreement
and shall be true and correct in all material respects as of the  
  Effective Time as if made as of the Effective Time, except for those
representations and warranties which are not so qualified as to   
 materiality and are made as of a specific date, which shall be true
and correct in all material respects as of such date; provided,   
   however, that the representations and warranties of the Company as to
  the operation of its business in the ordinary course and the absence
  of any Material Adverse Change in the Company shall not be deemed to
 be untrue or incorrect in any material respect (i) if the financial
performance of the Company with regard to the revenues, results of
operations or other financial performance of the Company are      
  materially consistent with the forecasts previously furnished by the
   Company to Goldman, (ii) if the Company or its Subsidiaries lose on a
    net basis the services of less than 50 salaried employees or 50 hourly
employees, or (iii) by reason of any matter arising out of the    
Company's relationship with Industrias Romi S.A.;                 

(b)the Company shall have performed or complied in all material respects
    with its agreements and covenants required to be performed or complied
   with under the Merger Agreement as of or prior to the Effective Time;

(c)the Company shall have delivered to Goldman and Merger Sub a         
    certificate of its President and Chief Executive Officer to the effect
    that certain conditions in the Merger Agreement have been satisfied in
all respects;                                                     

(d)(i) the Company shall have obtained all of the waivers, permits,     
  consents, approvals or other authorizations of Governmental Entities
   necessary to be obtained by it to consummate the Merger, and effected
 all registrations, filings and notices with respect to Governmental
   Entities necessary to be effected by it to consummate the Merger, and
 (ii) at least ten days prior to the Closing, the Company shall have
   delivered to Goldman a draft Form III and an Environmental Conditions
 Assessment Form (an "ECAF") or such other required filing under the
    Connecticut Transfer Act, Conn. Gen. Stat. (S)(S) 22a-134 et seq. (the
 "Connecticut Transfer Act"); at the Closing, the Company shall have
delivered to Goldman an executed Form III and ECAF or such other  
  required filing under the Connecticut Transfer Act for filing by the
Surviving Corporation following the Effective Date;               

(e)the Company shall have obtained and delivered to Goldman and Merger  
Sub copies of all consents, agreements or other evidence of       
cancellation from the holders of all outstanding Options;         

(f)no action, suit or proceeding shall be pending or threatened in      
  writing before any Governmental Entity which is reasonably likely to
 (i) prevent consummation of any of the transactions contemplated by
   the Merger Agreement, (ii) cause any of the transactions contemplated
by the Merger Agreement to be rescinded following consummation or 
(iii) affect materially and adversely the right of Goldman to own,
  operate or control any of the assets and operations of the Surviving
    Corporation following the Merger, and no such judgment, order, decree,
stipulation or injunction shall be in effect;                     

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(g)from the date of the Merger Agreement to the Effective Time, there   
shall not have been any event or development which results in a   
   Material Adverse Effect on the Company, nor shall there have occurred
any event or development which is reasonably likely to result in a
  Material Adverse Effect on the Company; there shall not be deemed to
have been any Material Adverse Effect on the Company (i) if the   
   financial performance of the Company with regard to revenues, results
of operations or other financial performance of the Company are   
  materially consistent with the forecasts previously furnished by the
   Company to Goldman; (ii) if the Company or its Subsidiaries lose on a
    net basis the services of less than 50 salaried employees or 50 hourly
employees; or (iii) by reason of any matter arising out of the    
Company's relationship with Industrias Romi S.A.;                 

(h)Goldman and Merger Sub shall have received from Willkie Farr &       
 Gallagher, or other counsel to the Company reasonably acceptable to
Goldman, an opinion with respect to certain matters, addressed to 
Goldman and Merger Sub and dated as of the Closing Date; and      

(i)the Textron Confirmation Letter (as defined below) shall be in full  
force and effect as of the Effective Time.                        

Additional Conditions to the Obligation of the Company. In addition, the  
obligation of the Company to effect and consummate the Merger under the Merger  
Agreement are subject to the following additional conditions:                   

 (a)the representations and warranties of Goldman and Merger Sub which are
    qualified as to materiality shall be true and correct when made on the
  date of the Merger Agreement and shall be true and correct as of the
Effective Time as if made as of the Effective Time, except for    
representations and warranties which are so qualified as to       
 materiality and are made as of a specific date, which shall be true
   and correct as of such date; the other representations and warranties
    of Goldman and Merger Sub which are not so qualified as to materiality
 shall be true and correct in all material respects when made on the
date of the Merger Agreement and shall be true and correct in all 
material respects as of the Effective Time as if made as of the   
   Effective Time, except for those representations and warranties which
  are not so qualified as to materiality and are made as of a specific
  date, which shall be true and correct in all material respects as of
such date;                                                        

 (b)each of Goldman and Merger Sub shall have performed or complied in all
material respects with its agreements and covenants required to be
  performed or complied with under the Merger Agreement as of or prior
to the Effective Time;                                            

(c)each of Goldman and Merger Sub shall have delivered to the Company a 
    certificate of its President and Chief Financial Officer to the effect
    that certain conditions in the Merger Agreement have been satisfied in
all respects;                                                     

(d)Goldman and Merger Sub shall have obtained all waivers, permits,     
  consents, approvals or other authorizations necessary to be obtained
by them to consummate the Merger and effected all registrations,  
 filings and notices, necessary to be effected by them to consummate
the Merger;                                                       

(e)no writ, order, decree or injunction of a Governmental Entity shall  
have been entered against Goldman, Merger Sub or the Company which
prohibits the consummation of the Merger; and                     

(f)the Company shall have received from Brown, Rudnick Freed & Gesmer,  
   counsel to Goldman and Merger Sub, an opinion with respect to certain
 matters, addressed to the Company and dated as of the Closing Date.

Termination                                                                     

The Merger Agreement may be terminated at any time prior to the Effective 
Time, whether before or after approval of the Merger Agreement by the holders   
of Common Stock:                                                                

 (a)by mutual written consent of the Board of Directors of Goldman and the
Board of Directors;                                               

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(b)by either Goldman or the Company, if any Governmental Entity shall   
have issued an order (other than a temporary restraining order),  
   decree, or ruling or taken any other action restraining, enjoining or
otherwise prohibiting the Merger, and such order, decree ruling or
    other action shall have become final and non-appealable, provided that
the party seeking termination shall have diligently contested such
order, decree, ruling or other action;                            

(c)by either Goldman or the Company, if the Merger Agreement and the    
   Merger fail to receive the approval of that number of stockholders of
 the Company necessary under Law to authorize and approve the Merger
Agreement and the Merger;                                         

 (d)by either Goldman or the Company, if the Board of Directors shall have
 recommended or resolved to recommend to its stockholders a Superior
Proposal, or if the Company has approved a Superior Proposal, and 
provided that the Company has complied with all provisions of the 
Merger Agreement relating thereto, including the notice provisions
therein, and further provided that the Company makes simultaneous 
payment of the Termination Fee;                                   

 (e)by either Goldman or the Company, if, without fault of and only in the
absence of any breach under the Merger Agreement by, the party    
 exercising the right of termination, the Merger shall not have been
consummated on or before December 31, 1999;                       

(f)by Goldman, if the conditions to the obligation of Goldman to effect 
   the Merger described above under "The Merger Agreement--Conditions to
the Proposed Merger--Additional Conditions to the Obligation of   
Goldman and Merger Sub", shall not have been satisfied; provided, 
  however, that if such failure or failures are capable of being cured
  prior to the Effective Time, such failure or failures shall not have
been cured within ten days of delivery to the Company of written  
notice of such failure;                                           

(g)by Goldman, if the Company shall have furnished or disclosed non     
public information to a Third Party with respect to any Takeover  
   Proposal, or shall have resolved to do the foregoing, or if the Board
 of Directors shall have recommended or resolved to recommend to its
stockholders a Takeover Proposal or if the Company has approved or
effected a Takeover Proposal, whether or not permitted under the  
Merger Agreement;                                                 

(h)by Goldman, if, prior to the Effective Date, the Board of Directors  
 shall have withdrawn, or modified or changed in a manner adverse to
 Goldman or Merger Sub, its approval or recommendation of the Merger
Agreement or the Merger;                                          

(i)by the Company, if Goldman or Merger Sub shall have failed to comply 
in any material respect with any of the covenants or agreements   
contained in the Merger Agreement such that the condition to the  
obligation of the Company to effect the Merger described above in 
clause (b) under "Merger Agreement--Conditions to the Proposed    
   Merger--Additional Conditions to the Obligation of the Company" would
   not be satisfied or the conditions described in clauses (c), (d), (e)
 and (f) under that caption shall not have been satisfied; provided,
  however, that if such failure is capable of being cured prior to the
    Effective Time, such failure shall not have been cured within ten days
of delivery to Goldman of written notice of such failure; or      

(j)by the Company, if there exists a breach of any one or more          
 representations or warranties of Goldman or Merger Sub contained in
   the Merger Agreement such that the condition to the obligation of the
Company to effect the Merger described above in clause (a) under  
"Merger Agreement--Conditions to the Proposed Merger--Additional  
  Conditions to the Obligation of the Company" would not be satisfied;
provided, however, that if such failure or failures are capable of
being cured prior to the Effective Time, such failure or failures 
 shall not have been cured within ten days of delivery to Goldman of
written notice of such failure.                                   

Termination Fee; Reimbursement of Goldman Expenses on Termination               

In the event of the termination of the Merger Agreement, the Merger       
Agreement has no further effect except as specifically provided in the Merger   
Agreement. There shall be no liability on the part of any party (or             

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its directors, officers or Affiliates) on such termination except for liability 
for any willful and material breach by a party of any of its representations,   
warranties, covenants or agreements in the Merger Agreement and except as       
otherwise provided in the Merger Agreement.                                     

In the event of termination of the Merger Agreement pursuant to clause (d)
under "The Merger Agreement--Termination", the Company has agreed, within five  
business days thereafter, to pay Goldman the Termination Fee.                   

To the extent that the Termination Fee has for any reason other than a    
material breach by Goldman not already been paid and within 12 months after the 
termination of the Merger Agreement the Company or any of its Subsidiaries, or  
any Company Affiliate enters into a definitive agreement with a Third Party     
with respect to a Takeover Proposal or a Takeover Proposal is effected, then    
the Company has agreed, within five business days after the consummation of     
such Takeover Proposal, to pay Goldman the Termination Fee less any Goldman     
Documented Expenses previously paid by the Company to Goldman.                  

 If the Merger Agreement is terminated under circumstances that obligate the
Company to pay to Goldman the Termination Fee, Textron, which holds             
approximately 21% of the outstanding Common Stock, has agreed to pay to Goldman 
an amount equal to the product of (a) the amount by which the consideration per 
share paid to Textron pursuant to the transaction triggering such termination   
exceeds $10.00, and (b) the total number of shares of Common Stock transferred  
by Textron pursuant to such transaction.                                        

In the event of termination of the Merger Agreement:                      

(i) pursuant to clause (c) under "The Merger Agreement--Termination";   

(ii) by Goldman pursuant to clause (f) under "The Merger Agreement--  
Termination" as a result of a failure to satisfy the conditions in clause (a)   
(to the extent such failure results from a breach by the Company of its         
representations and warranties under the Merger Agreement), clause (b) or       
clause (d)(ii) under "The Merger Agreement--Conditions to the Proposed Merger-- 
Additional Conditions to the Obligation of Goldman and Merger Sub";             

 (iii) by Goldman pursuant to clause (g) under "The Merger Agreement--
Termination"; or                                                                

(iv) by Goldman pursuant to clause (h) under "The Merger Agreement--  
Termination",                                                                   

the Company has agreed, within five business days thereafter, to pay Goldman an 
amount equal to the Goldman Documented Expenses (as defined below). However,    
the Goldman Documented Expenses which the Company is to pay in the event of     
termination of the Merger Agreement pursuant to clause (c) under "The Merger    
Agreement--Termination" cannot exceed $650,000 and the Goldman Documented       
Expenses which the Company is to pay in the event of termination of the Merger  
Agreement pursuant to clauses (f), (g) or (h) under "The Merger Agreement--     
Termination" cannot exceed $500,000. In addition, the Company is not obligated  
to pay any Goldman Documented Expenses if: (i) Goldman or Merger Sub shall have 
failed to comply in any material respect with any of the covenants or           
agreements contained in the Merger Agreement such that the closing condition    
set forth in clause (b) under "The Merger Agreement--Conditions to the Proposed 
Merger--Additional Conditions to the Obligation of the Company" would not be    
satisfied; or (ii) there exists a breach of any one or more representations or  
warranties of Goldman or Merger Sub contained in the Merger Agreement in any    
material respect such that the closing condition set forth in clause (a) under  
"The Merger Agreement--Conditions to the Proposed Merger--Additional Conditions 
to the Obligation of the Company" would not be satisfied.                       

For purposes of the Merger Agreement, "Goldman Documented Expenses" means 
all documented out of pocket reasonable fees and expenses incurred by Goldman   
and Merger Sub since January 1, 1999 (including the reasonable fees and         
expenses of counsel, accountants, consultants and advisors, and any commitment  
fees and other expenses paid to prospective lenders) in connection with the     
Merger Agreement and the transactions contemplated thereby.                     

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Amendment and Waiver                                                            

  Subject to applicable Law, the Merger Agreement may be amended, modified and
supplemented in any and all respects, whether before or after any vote of the   
stockholders of the Company contemplated thereby, by written agreement of the   
parties thereto at any time prior to the Closing Date with respect to any of    
the terms contained therein. The conditions to each of the parties' obligation  
to consummate the Merger are for the sole benefit of such party and may be      
waived by such party in whole or in part to the extent permitted by applicable  
law.                                                                            

INTERESTS OF CERTAIN PERSONS IN THE MERGER

 Certain officers and directors of the Company have agreements which will be
effected as a result of the Merger. In addition, certain officers of the        
Company have entered into new employment or consulting arrangements that become 
effective at the Effective Time. These existing and new agreements are          
discussed below.                                                                

Stock Options                                                                   

  Immediately prior to the Effective Time, each Option granted pursuant to the
Company's stock option plans will become fully vested and immediately           
exercisable. Each holder of an Option outstanding immediately prior to          
Effective Time will be entitled to receive and will be paid in full             
satisfaction of such Option, or each Option will after the Effective Time be    
exercisable for, a cash payment equal to the product of (i) the excess, if any, 
of the Merger Consideration over the exercise price per share of Common Stock   
subject to such Option multiplied by (ii) the number of shares of Common Stock  
subject to such Option immediately prior to the Effective Time, less any income 
or employment tax withholding required under the Code or any provision of       
state, local or foreign tax law.                                                

Employment Agreements                                                           

 The employment of Dan L. Griffith, President and Chief Executive Officer of
the Company, will terminate upon completion of the Merger. Under the terms of   
Mr. Griffith's employment agreement with the Company, dated September 7, 1995,  
Mr. Griffith will be paid his current base salary, in accordance with the       
Company's normal payroll practices, and allowed to participate in the Company's 
benefit plans for the two-year period commencing on his termination date. As of 
Mr. Griffith's termination date, he will be retained as a consultant to the     
Company for six months. The terms of the consulting agreement are discussed     
below.                                                                          

  Following the Merger, Walter C. Lazarcheck will continue his employment with
the Company as its Vice President, Chief Financial Officer and Secretary        
pursuant to the terms of his present employment agreement with the Company      
dated March 27, 1998. Mr. Lazarcheck will also be paid a bonus of $69,575 by    
Goldman at the time of the Closing.                                             

Following the Merger, Malcolm Taylor will continue his employment as the  
Managing Director European Operations of Bridgeport Machines Limited, a wholly  
owned subsidiary of the Company, pursuant to the terms of his present service   
agreement dated September 6, 1996. Mr. Taylor will also be paid a bonus of      
UK(Pounds)57,576 by Goldman, one-half to be paid at the time of the Closing and 
the remainder to be paid six months thereafter, provided Mr. Taylor continues   
to perform his present obligations under his service agreement.                 

Consulting Agreement                                                            

Dan L. Griffith, the President and Chief Executive Officer of the Company,
will be retained as a consultant to the Company for the six-month period        
commencing as of the Closing (the "Term"). Under the terms of the consulting    
agreement, Mr. Griffith will receive $1,000 for each day on which he provides   
consulting services to                                                          

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the Company, and $500 for each business day for which no services are provided  
to the Company. Mr. Griffith will also receive a lump sum payment of $72,500 at 
the time of the Closing. At the end of the Term, Mr. Griffith will receive an   
additional lump sum payment of $72,500 (reduced by the aggregate payments       
received by Mr. Griffith on days for which no consulting services are performed 
for the Company). During the Term and continuing until July 31, 2000, Mr.       
Griffith is prohibited from engaging in certain competitive business activities 
with the Company and its affiliates.                                            

RELATED AGREEMENTS AND TRANSACTIONS 

Voting Agreements for Principal Stockholders Other Than Textron                 

In connection with the execution of the Merger Agreement, each of the     
Principal Stockholders entered into an agreement (collectively, the "Voting     
Agreements") with Goldman pursuant to which such Principal Stockholder, among   
other things, granted Goldman a proxy to vote the shares of Common Stock over   
which such Principal Stockholder has voting control in favor of the adoption    
and approval of the Merger Agreement and the transactions contemplated thereby  
at the Special Meeting.                                                         

Each Principal Stockholder has agreed not to sell, transfer or otherwise  
dispose of, or reduce his interests in, any shares of Common Stock owned by     
such stockholder prior to the termination of such Stockholder's Voting          
Agreement.                                                                      

Each Principal Stockholder has additionally agreed not to, directly or    
indirectly, (i) solicit, initiate or encourage (or authorize any person to      
solicit, initiate or encourage) any inquiry, proposal or offer from any person  
(other than Goldman) to acquire the business, property or capital stock of the  
Company or any of its subsidiaries, or any acquisition of a substantial equity  
interest in, or a substantial amount of the assets of, the Company or any of    
its subsidiaries or (ii) participate in any discussion or negotiations          
regarding, or furnish to any other person any information with respect to, or   
otherwise cooperate in any way with, or participate in, facilitate or encourage 
any effort or attempt by any person (other than Goldman) to do or seek any of   
the foregoing. However, each Principal Stockholder or its representative, as a  
member of the Board of Directors, may take actions in such capacity as are      
permitted under the Merger Agreement.                                           

Each Voting Agreement will terminate upon the earlier of (i) the Effective
Time, and (ii) the termination of the Merger Agreement in accordance with the   
provisions thereof.                                                             

Textron Voting Agreement                                                        

The Voting Agreement into which Textron entered with Goldman (the "Textron
Voting Agreement") contains substantially identical terms and conditions as are 
in the other Voting Agreements. In addition, the Textron Voting Agreement       
provides for the payment by Textron, under circumstances, of a fee to Goldman   
if the Merger Agreement is terminated and the Company becomes obligated to pay  
to Goldman the Termination Fee. See "The Merger Agreement--Termination Fee;     
Reimbursement of Goldman Expenses on Termination".                              

Textron Confirmation Letter                                                     

Textron and Goldman entered into a letter agreement, dated April 23, 1999 
(the "Textron Confirmation Letter"), which confirms the obligation of Textron   
to indemnify the Surviving Corporation following the Merger for environmental   
claims under the Purchase and Sale Agreement, dated as of May 7, 1986, by and   
between the Company and Textron, and the Settlement Agreement, dated as of June 
22, 1994, by and between the Company and Textron.                               

The foregoing description of the Voting Agreements, the Textron Voting    
Agreement and the Textron Confirmation Letter is qualified in its entirety by   
reference to the form of Voting Agreement for principal stockholders other than 
Textron attached as Appendix C to this proxy statement, the Textron Voting      
Agreement attached as Appendix B to this proxy statement and the Textron        
Confirmation Letter attached as Appendix D to this proxy statement.             

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OWNERSHIP OF COMMON STOCK 

The table below sets forth, as of June 4, 1999, certain information       
regarding beneficial ownership of Common Stock with respect to (i) each person  
or entity known to the Company who beneficially owns more than 5% of the        
outstanding shares of Common Stock, (ii) each director, (iii) the Company's     
Chief Executive Officer and the four other most highly compensated executive    
officers in fiscal 1999 and (iv) all executive officers and directors of the    
Company as a group. Pursuant to the regulations of the SEC, shares are deemed   
to be "beneficially owned" by a person if such person directly or indirectly    
has or shares (a) the power to vote or dispose of such shares whether or not    
such person has any pecuniary interest in such shares or (b) the right to       
acquire the power to vote or dispose of such shares within 60 days, including   
any right to acquire through the exercise of any option, warrant or right.      

                                                                [Download Table]

                                                        Number of  Percent of 
Beneficial Owner                                         Shares   Total Shares
----------------                                        --------- ------------
                                                                              
Textron Inc............................................ 1,207,733     21.6%   
 40 Westminster Street                                                        
 Providence, RI 02903                                                         
Citigroup Inc. (1).....................................   711,796     12.8%   
 153 East 53 Street                                                           
 New York, NY 10043                                                           
Lehman Brothers Holdings, Inc..........................   639,935     11.5%   
 Three World Financial Center                                                 
 New York, NY 10285                                                           
High Technology Holding Corp. (2)......................   568,700     10.2%   
 2229 South Yale Street                                                       
 Santa Ana, CA 92704                                                          
Kansas Debt Fund,......................................   535,910      9.6%   
Nominee for Kansas Public Employees Retirement                                
Systems (3)                                                                   
 c/o Portfolio Advisors, Inc.                                                 
 9 Old Kings Highway South                                                    
 Darien, CT 06820                                                             
U.S. Bancorp (4).......................................   316,140      5.7%   
 601 2nd Avenue South                                                         
 Minneapolis, MN 55402                                                        
Joseph E. Clancy.......................................    82,043      1.5%   
Dan L. Griffith (5)....................................    94,777      1.7%   
Walter C. Lazarcheck (6)...............................    17,467        *    
Robert L. Rochford (7).................................     4,000        *    
Malcolm Taylor (8).....................................    26,883        *    
Robert J. Cresci (9)...................................    11,500        *    
Eliot M. Fried (10)....................................    21,500        *    
Bhikhaji M. Maneckji (11)..............................        --        *    
All Directors and Executive Officers as a group (8                            
 persons)..............................................   258,170      4.5%   

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--------                                                                        
*  Less than 1% of the outstanding Common Stock                                 
1. In a Schedule 13G filed with the SEC on January 22, 1999, Citigroup Inc.     
reported that, as of January 12, 1999, it held 711,796 shares of Common   
Stock. Citigroup Inc. reported that it possessed: (i) shared dispositive  
power with respect to 711,796 shares and (ii) shared voting power with    
respect to 711,796 shares.                                                
2. In a Schedule 13D filed with the SEC on July 22, 1998, as amended on March   
  15, 1999, HTH reported that, as of March 15, 1999, it held 568,700 shares of
Common Stock. HTH reported that it possessed: (i) sole dispositive power  
with respect to 568,700 shares and (ii) sole voting power with respect to 
568,700 shares.                                                           
3. The Company's register of stockholders of record indicates that, as of June  
4, 1999, Kansas Debt Fund, Nominee for Kansas Public Employees Retirement 
Systems, holds 535,910 shares of Common Stock.                            
4. In a Schedule 13G filed with the SEC on March 1, 1999, U.S. Bancorp, a       
parent holding company, reported that as of December 31, 1998 it held     
  316,140 shares of Common Stock. U.S. Bancorp reported that it possessed: (i)
sole dispositive power with respect to 316,140 shares and (ii) sole voting
power with respect to 303,540 shares.                                     
5. Includes 41,666 shares which may be acquired by Mr. Griffith upon the        
exercise of immediately exercisable Options.                              
6. Consists of 17,467 shares which may be acquired by Mr. Lazarcheck upon the   
exercise of immediately exercisable Options.                              
7. Consists of 4,000 shares which may be acquired by Mr. Rochford upon the      
exercise of immediately exercisable Options.                              
8. Includes 19,133 shares which may be acquired by Mr. Taylor upon the exercise 
of immediately exercisable Options.                                       
9. Consists of 11,500 shares which may be acquired by Mr. Cresci upon the       
  exercise of immediately exercisable Options. Does not include 226,166 shares
  beneficially owned by State of Delaware Employees Retirement Fund, which Mr.
Cresci may be deemed to beneficially own by virtue of his position as a   
 Managing Director of Pecks Management Partners Ltd., investment advisor for
such fund.                                                                
10. Includes 11,500 shares which may be acquired by Mr. Fried upon the exercise 
of immediately exercisable Options. Does not include shares beneficially
 owned by Lehman Brothers Holdings, Inc., which Mr. Fried may be deemed to
 beneficially own by virtue of his position as Managing Director of Lehman
Brothers Holdings, Inc.                                                 
11. Does not include shares beneficially owned by Textron, which include shares 
underlying Options registerered in Mr. Maneckji's name, of which Mr.    
Maneckji disclaims beneficial ownership.                                

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS 

The following are or may constitute forward-looking statements within the 
meaning of the Private Securities Litigation Reform Act of 1995:                

   (i) certain statements concerning possible or assumed future results of
operations of the Company contained in "The Merger--Background of the       
Merger", "The Merger--Reasons for the Merger; Recommendation of the Board   
of Directors", "The Merger--Projections" and "The Merger--Opinion of the    
Company's Financial Advisor", including any forecasts or projections        
referred to in this proxy statement and certain statements incorporated by  
reference from the Annual Report, including any statements contained in     
this proxy statement or in the Annual Report, regarding the expansion of    
the use of the Company's products into the factory floor market, expansion  
of the Company's marketing efforts into foreign markets, the Company's      
ability to develop additional sources of supply, the Company's shipment of  
its current backlog, the Company's expected expenditures on environmental   
matters, the Company's use of cash in operating activities, the Company's   
ability to satisfactorily resolve any outstanding litigation, the ability   
of the Company to meet working capital needs, the effect on the Company of  
the adoption of certain accounting standards or the effect of the Merger;   

(ii) any statements preceded by, followed by or that include the words
"believes," "expects," "anticipates," "intends" or similar expressions      
contained in the sections of this proxy statement cited above or            
incorporated herein; and                                                    

(iii) other statements contained or incorporated by reference in this 
proxy statement regarding matters that are not historical facts.            

Because such statements are subject to risks and uncertainties, actual    
results may differ materially from those expressed or implied by such forward-  
looking statements. The Company's stockholders are cautioned not to place undue 
reliance on such statements, which speak only as of the date of this proxy      
statement or, in the case of the Company documents incorporated by reference,   
the date of such document.                                                      

All subsequent written and oral forward-looking statements attributable to
the Company or persons acting on its or their behalf are expressly qualified in 
their entirety by the cautionary statements contained or referred to in this    
section. The Company does not undertake any obligation to release publicly any  
revisions to such forward-looking statements to reflect events or circumstances 
after the date of this proxy statement or to reflect the occurrence of          
unanticipated events.                                                           

No person has been authorized by the Company to give any information or to
make any representation not contained in this proxy statement and, if given or  
made, such information or representation should not be relied upon as having    
been authorized by the Company. This proxy statement does not constitute an     
offer or solicitation to sell or a solicitation of an offer to buy any          
securities. The delivery of this proxy statement shall not, under any           
circumstances, imply or create any implication that there have not been any     
changes in the affairs of the Company or in the information set forth or        
incorporated by reference herein subsequent to the date hereof.                 

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AVAILABLE INFORMATION 

The Company files annual, quarterly and special reports, proxy statements 
and other information with the Securities and Exchange Commission. You may read 
and copy any reports, statements or other information we file at the Securities 
and Exchange Commission's public reference rooms in Washington, D.C., New York, 
New York and Chicago, Illinois. Please call the Securities and Exchange         
Commission at 1-800-SEC-0330 for further information on the public reference    
rooms. Our filings are also available to the public from commercial document    
retrieval services and at the web site maintained by the Securities and         
Exchange Commission at "http://www.sec.gov".                                    

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 

The Securities and Exchange Commission allows us to "incorporate by       
reference" information into this proxy statement, which means that we can       
disclose important information to you by referring you to another document      
filed separately with the Securities and Exchange Commission. The information   
incorporated by reference is deemed to be part of this proxy statement, except  
for any information superseded by information in this proxy statement. This     
proxy statement incorporates by reference the Annual Report which accompanies   
this proxy statement. The Annual Report contains important information about    
the Company and its finances.                                                   

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APPENDIX A

                                                                  EXECUTION COPY

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

AGREEMENT AND PLAN OF MERGER

by and among

GOLDMAN INDUSTRIAL GROUP, INC., 

BRONZE ACQUISITION CORP.

and 

BRIDGEPORT MACHINES, INC. 

dated as of 

April 23, 1999

--------------------------------------------------------------------------------
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AGREEMENT AND PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER, dated as of April 23, 1999, by and among    
GOLDMAN INDUSTRIAL GROUP, INC., a Delaware corporation ("Parent"), BRONZE       
ACQUISITION CORP., a Delaware corporation and a wholly-owned Subsidiary of      
Parent ("Merger Sub"), and BRIDGEPORT MACHINES, INC., a Delaware corporation    
(the "Company").                                                                

WHEREAS, the Board of Directors of each of Parent, Merger Sub and the     
Company have approved, and deem it advisable and in the best interests of their 
respective stockholders to consummate, the acquisition of the Company by Parent 
and Merger Sub pursuant to a merger (the "Merger") of the Merger Sub with and   
into the Company upon the terms and subject to the conditions set forth herein; 

 WHEREAS, also in furtherance of such acquisition, the Board of Directors of
each of Parent, Merger Sub and the Company have approved this Agreement and the 
Merger in accordance with the General Corporation Law of the State of Delaware, 
and upon the terms and subject to the conditions set forth herein;              

WHEREAS, the Board of Directors of the Company has determined that the per
share consideration to be paid for the issued and outstanding shares of Common  
Stock, $.01 par value, of the Company (the "Shares") in the Merger is fair to   
the holders of such Shares and has resolved to recommend that the holders of    
such Shares approve and adopt this Agreement and the Merger upon the terms and  
subject to the conditions set forth herein;                                     

WHEREAS, the Company, Parent and Merger Sub desire to make certain        
representations, warranties, covenants and agreements in connection with the    
Merger; and                                                                     

  WHEREAS, as a condition and inducement to Parent's and Merger Sub's entering
into this Agreement and incurring the obligations set forth herein,             
concurrently with the execution and delivery of this Agreement, Parent, Merger  
Sub and the Company are entering into Voting Agreements (collectively, the      
"Voting Agreement") with Textron Inc., Lehman LBO Inc., State of Delaware       
Employees Retirement Fund, Joseph E. Clancy and Dan L. Griffith. (collectively, 
the "Principal Stockholders"), pursuant to which, among other things, the       
Principal Stockholders have agreed to grant Parent a proxy with respect to the  
voting of the Shares over which they have voting control, all upon the terms    
and subject to the conditions set forth in the Voting Agreement;                

NOW, THEREFORE, in consideration of the foregoing and the covenants and   
agreements set forth herein, the parties hereto, intending to be legally bound  
hereby, agree as follows:                                                       

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ARTICLE I.

The Merger

1.1. The Merger.                                                          

(a) Subject to the terms and conditions of this Agreement, at the     
Effective Time (as defined in Section 1.2 hereof), the Company and Merger   
Sub shall consummate the Merger pursuant to which (a) Merger Sub shall be   
merged with and into the Company and the separate corporate existence of    
Merger Sub shall thereupon cease and (b) the Company shall be the surviving 
corporation in the Merger (sometimes hereinafter referred to as the         
"Surviving Corporation") and shall continue to be governed by the Laws of   
the State of Delaware.                                                      

(b) Pursuant to the Merger, (x) the Restated Certificate of           
Incorporation of the Company (the "Certificate of Incorporation"), as in    
effect immediately prior to the Effective Time, shall be the initial        
certificate of incorporation of the Surviving Corporation and (y) the by-   
laws of the Company (the "By-laws"), as in effect immediately prior to the  
Effective Time, shall be the initial By-laws of the Surviving Corporation,  
each until thereafter changed or amended as provided therein or by          
applicable law. The Merger shall have the effects specified in the Delaware 
General Corporation Law (the "DGCL").                                       

(c) The directors of Merger Sub at the Effective Time shall be the    
initial directors of the Surviving Corporation until their respective       
successors are duly elected and qualified or until their earlier death,     
resignation or removal in accordance with the Surviving Corporation's       
certificate of incorporation and by-laws. The officers of the Merger Sub at 
the Effective Time shall be the initial officers of the Surviving           
Corporation until their respective successors are duly elected and          
qualified or until their earlier death, resignation or removal in           
accordance with the Surviving Corporation's certificate of incorporation    
and by-laws.                                                                

1.2. Effective Time. Parent, Merger Sub and the Company will cause a      
certificate of merger, or, if applicable, a certificate of ownership and merger 
(as applicable, the "Certificate of Merger"), to be executed and filed on the   
date of the Closing (as defined in Section 1.3) (or on such other date as       
Parent and the Company may agree) with the Secretary of State of the State of   
Delaware (the "Secretary of State") as provided in the DGCL. The Merger shall   
become effective on the date on which the Certificate of Merger has been duly   
filed with the Secretary of State or such time as is agreed upon by the parties 
and specified in the Certificate of Merger, and such time is hereinafter        
referred to as the "Effective Time."                                            

 1.3. Closing. The closing of the Merger (the "Closing") shall take place at
10:00 a.m., local time, on a date to be specified by the parties, which shall   
be no later than the third business day after satisfaction or waiver of all of  
the conditions set forth in Article VI hereof (the "Closing Date"), at the      
offices of Brown, Rudnick, Freed & Gesmer, One Financial Center, Boston,        
Massachusetts 02111, unless another date or place is agreed to in writing by    
the parties hereto.                                                             

1.4. Stockholders' Meeting and Proxy Statement.                           

(a) The Company shall prepare, in consultation with Parent, and the   
Company shall file with the SEC under the Exchange Act, subject to the      
other provisions of this Agreement, proxy materials for the purpose of      
soliciting proxies from holders of the Shares to vote in favor of the       
adoption of this Agreement and the approval of the Merger at a meeting of   
the stockholders of the Company to be called and held for such purpose (the 
"Special Meeting"). Such proxy materials shall be used for the purpose of   
soliciting such proxies from holders of the Shares (such proxy statement,   
together with any accompanying letter to stockholders, notice of meeting    
and form of proxy, shall be referred to herein as the "Proxy Statement").   
Parent and the Merger Sub shall furnish to the Company all information      
concerning Parent and the Merger Sub as the Company may reasonably request  
in connection with the preparation of the Proxy Statement. Parent and its   
counsel shall be given an opportunity to review and comment on the Proxy    
Statement prior to its filing with the SEC. The Company, in consultation    
with Parent, shall promptly respond to any SEC                              

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comments on the Proxy Statement and shall otherwise use reasonable best     
efforts to resolve as promptly as practicable all SEC comments thereon.     

 (b) A copy of the opinion of Lehman Brothers Inc. as to the fairness of
the Merger Consideration shall be delivered by the Company to Parent as of  
the execution of this Agreement.                                            

(c) Promptly following the resolution of all SEC comments on the Proxy
Statement, the Company shall distribute the Proxy Statement to its          
stockholders and, pursuant thereto, shall call the Special Meeting in       
accordance with the DGCL and subject to the other provisions of this        
Agreement, solicit proxies from the stockholders of the Company to vote in  
favor of the adoption of this Agreement and the approval of the Merger at   
the Special Meeting.                                                        

  (d) The Company shall comply with all applicable provisions of and rules
under the Exchange Act and all applicable provisions of the DGCL in the     
preparation, filing and distribution of the Proxy Statement, the            
solicitation of proxies thereunder, and the calling and holding of the      
Special Meeting.                                                            

  (e) Except as otherwise provided herein, the Company, acting through its
Board of Directors, shall include in the Proxy Statement the recommendation 
of its Board of Directors that the stockholders of the Company vote in      
favor of the adoption of this Agreement and the approval of the Merger, and 
shall otherwise use reasonable best efforts to obtain the requisite vote of 
the holders of the Shares pursuant to the DGCL and the Company's            
Certificate of Incorporation in order to consummate the Merger.             

ARTICLE II. 

Conversion of Securities

  2.1. Conversion of Capital Stock. As of the Effective Time, by virtue of the
Merger and without any action on the part of the holders of any Shares or any   
shares of capital stock of Merger Sub:                                          

(a) Merger Sub Capital Stock. Each issued and outstanding share of    
Common Stock of Merger Sub shall be converted into and become one fully     
paid and nonassessable share of common stock of the Surviving Corporation.  

(b) Cancellation of Treasury Stock and Merger Sub-Owned Stock. All    
Shares that are owned by the Company or any Subsidiary of the Company and   
any Shares owned by Parent, Merger Sub or any Subsidiary of Parent or       
Merger Sub shall be cancelled and retired and shall cease to exist and no   
consideration shall be delivered in exchange therefor.                      

(c) Exchange of Shares. Each issued and outstanding Share (other than 
Shares to be cancelled in accordance with Section 2.1 (b) and any Shares    
which are held by stockholders exercising appraisal rights pursuant to      
Section 262 of the DGCL ("Dissenting Stockholders")) shall be converted     
into the right to receive $10.00 per share in cash, payable to the holder   
thereof, without interest (the "Merger Consideration"), upon surrender of   
the certificate formerly representing such Share in the manner provided in  
Section 2.2. All such Shares, when so converted, shall no longer be         
outstanding and shall automatically be cancelled and retired and shall      
cease to exist, and each holder of a certificate representing any such      
Shares shall cease to have any rights with respect thereto, except the      
right to receive the Merger Consideration therefor upon the surrender of    
such certificate in accordance with Section 2.2, without interest, or the   
right, if any, to receive payment from the Surviving Corporation of the     
"fair value" of such Shares as determined in accordance with Section 262 of 
the DGCL.                                                                   

2.2. Exchange of Certificates.                                            

 (a) Paying Agent. Prior to the Effective Time, Parent shall designate a
bank, trust company or other Person, reasonably acceptable to the Company,  
to act as agent for the holders of the Shares in connection with the Merger 
(the "Paying Agent") to receive the funds to which holders of the Shares    
shall become entitled pursuant to Section 2.l(c). At the Effective Time,    
Parent shall deposit with the Paying Agent funds                            

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in an amount sufficient for the payment of the Merger Consideration as      
provided herein. All interest earned on such funds shall be paid to Parent. 

(b) Exchange Procedures. As soon as reasonably practicable after the  
Effective Time, Parent shall cause the Paying Agent to mail to each holder  
of record of a certificate or certificates, which immediately prior to the  
Effective Time represented outstanding Shares (the "Certificates"), whose   
Shares were converted pursuant to Section 2.1 into the right to receive the 
Merger Consideration (i) a letter of transmittal (which shall specify that  
delivery shall be effected, and risk of loss and title to the Certificates  
shall pass, only upon delivery of the Certificates to the Paying Agent and  
shall be in such form and have such other provisions as Parent may          
reasonably specify) and (ii) instructions for use in effecting the          
surrender of the Certificates in exchange for payment of the Merger         
Consideration. Upon surrender of a Certificate for cancellation to the      
Paying Agent or to such other agent or agents as may be appointed by        
Parent, together with such letter of transmittal, duly executed, Parent     
shall cause the Paying Agent to pay to the holder of such Certificate in    
exchange therefor the Merger Consideration for each Share formerly          
represented by such Certificate and the Certificate so surrendered shall    
forthwith be cancelled. If payment of the Merger Consideration is to be     
made to a Person other than the Person in whose name the surrendered        
Certificate is registered, it shall be a condition of payment that the      
Certificate so surrendered shall be properly endorsed or shall be otherwise 
in proper form for transfer and that the Person requesting such payment     
shall have paid any transfer and any other taxes required by reason of the  
payment of the Merger Consideration to a Person other than the registered   
holder of the Certificate surrendered or shall have established to the      
satisfaction of the Surviving Corporation that such tax either has been     
paid or is not applicable. Until surrendered as contemplated by this        
Section 2.2, each Certificate shall be deemed at any time after the         
Effective Time to represent only the right to receive the Merger            
Consideration in cash as contemplated by this Section 2.2. The right of any 
stockholder to receive the Merger Consideration shall be subject to and     
reduced by any applicable federal backup withholding obligation.            

(c) Transfer Books; No Further Ownership Rights in the Shares. At the 
Effective Time, the stock transfer books of the Company shall be closed and 
thereafter there shall be no further registration of transfers of the       
Shares on the records of the Company. From and after the Effective Time,    
the holders of Certificates evidencing ownership of the Shares outstanding  
immediately prior to the Effective Time shall cease to have any rights with 
respect to such Shares, except as otherwise provided for herein or by       
applicable Law. If, after the Effective Time, Certificates are presented to 
the Surviving Corporation for any reason, they shall be cancelled and       
exchanged as provided in this Article II.                                   

 (d) Termination of Fund; No Liability. At any time following six months
after the Effective Time, the Surviving Corporation shall be entitled to    
require the Paying Agent to deliver to it any funds (including any interest 
received with respect thereto) which had been made available to the Paying  
Agent and which have not been disbursed to holders of Certificates, and     
thereafter such holders shall be entitled to look to the Surviving          
Corporation (subject to abandoned property, escheat or other similar Laws)  
only as general creditors thereof with respect to the Merger Consideration  
payable upon due surrender of their Certificates, without any interest      
thereon. Notwithstanding the foregoing, none of Parent, the Surviving       
Corporation or the Paying Agent shall be liable to any holder of a          
Certificate for Merger Consideration delivered to a public official         
pursuant to any applicable abandoned property, escheat or similar Law.      

2.3. Dissenters' Rights. Notwithstanding anything in this Agreement to the
contrary, if any Dissenting Stockholder shall demand to be paid the "fair       
value" of such holder's Shares, as provided in Section 262 of the DGCL, such    
Shares shall not be converted into or be exchangeable for the right to receive  
the Merger Consideration except as provided in this Section 2.3 and the Company 
shall give Parent notice thereof and Parent shall have the right to participate 
in all negotiations and proceedings with respect to any such demands. Neither   
the Company nor the Surviving Corporation shall, except with the prior written  
consent of Parent, voluntarily make any payment with respect to, or settle or   
offer to settle, any such demand for payment. If any Dissenting Stockholder     
shall fail to perfect or shall have effectively withdrawn or lost the right to  
dissent, the                                                                    

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Shares held by such Dissenting Stockholder shall thereupon be treated as though 
such Shares had been converted into the Merger Consideration pursuant to        
Section 2.1.                                                                    

2.4. Transfer of Shares After the Effective Time. No transfer of Shares   
shall be made on the stock transfer books of the Surviving Corporation at or    
after the Effective Time.                                                       

 2.5. Stock Options. The Company shall use its reasonable efforts to provide
that, immediately prior to the Effective Time, each then outstanding option to  
purchase Shares (in each case, an "Option"), whether or not then exercisable,   
shall be returned to and cancelled by the Company and in consideration of such  
return and cancellation and except to the extent that Parent or Merger Sub and  
the holder of any such Option otherwise agrees, as soon as reasonably           
practicable after the Effective Time, Parent shall cause the Paying Agent to    
pay to the holders of the Options which have been returned and cancelled to the 
satisfaction of Parent an amount in respect thereof equal to the product of (A) 
the excess, if any, of the Merger Consideration over the exercise price of each 
such Option and (B) the number of Shares previously subject to the Option       
immediately prior to its cancellation (such payment to be net of withholding    
taxes and without interest). The Company shall use its reasonable efforts to    
cause the holders of such Options to consent to the transactions contemplated   
by this Section 2.5, prior to the Effective Time. At the Effective Time, Parent 
shall deposit with the Paying Agent funds in an amount sufficient for the       
payment provided herein. All interest on such funds shall be paid to Parent.    

ARTICLE III.

Representations and Warranties of the Company 

The Company represents and warrants to Parent and Merger Sub as follows:  

3.1. Organization, Standing and Corporate Power. Each of the Company and  
each of its Subsidiaries is a corporation duly organized, validly existing and  
in good standing under the Laws of the jurisdiction in which it is organized    
and has the requisite corporate power and authority to carry on its business as 
is now being conducted. Each of the Company and its Subsidiaries is duly        
qualified as a foreign corporation or licensed to do business and is in good    
standing in each jurisdiction in which the nature of its business or the        
ownership or leasing of its properties makes such qualification or licensing    
necessary, other than in such jurisdictions where the failure to be so          
qualified or licensed (individually or in the aggregate) would not have a       
Material Adverse Effect on the Company. The Company has delivered to Parent     
complete and correct copies of the certificate of incorporation of the Company  
and by-laws of the Company, in each case as amended to the date of this         
Agreement, and has delivered the certificates of incorporation and by-laws or   
other comparable organizational documents of its Subsidiaries in each case as   
amended as of the date of this Agreement. The respective certificates of        
incorporation and by-laws or other comparable organizational documents of the   
Subsidiaries of the Company do not contain any provision limiting or otherwise  
restricting the ability of the Company to control such Subsidiaries.            

3.2. Subsidiaries.                                                        

(a) Exhibit 21 to the Company's Annual Report on Form 10-K for the    
fiscal year ended March 28, 1998 and Schedule 3.2 of the disclosure         
schedule delivered by the Company to Parent at or prior to the execution of 
this Agreement (the "Company Disclosure Schedule") together include all of  
the Subsidiaries of the Company. Except as set forth in Schedule 3.2 of the 
Company Disclosure Schedule, all of the outstanding shares of capital stock 
of, or other equity interests in, each Subsidiary of the Company have been  
validly issued and are fully paid and nonassessable and are owned directly  
or indirectly by the Company, free and clear of all Liens and free of any   
other restriction (including any restriction on the right to vote, sell or  
otherwise dispose of such capital stock or other ownership interests).      

(b) The Company does not directly or indirectly beneficially own any  
securities or other beneficial ownership interests in any other entity      
(including through joint ventures or partnership arrangements) other than   
(i) the Subsidiaries of the Company, (ii) as disclosed in Schedule 3.2 of   
the Company Disclosure                                                      

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Schedule and (iii) investments in publicly traded securities constituting   
less than five percent of the outstanding equity of the issuing entity.     

  3.3. Capital Structure. The authorized capital stock of the Company consists
of 13,000,000 Shares and 2,000,000 shares of preferred stock, par value $.01    
per share (the "Preferred Shares"). As of the date hereof, (i) 5,568,104 Shares 
were issued and outstanding and no Preferred Shares were issued and             
outstanding, (ii) 255,998 Shares were reserved for issuance upon exercise of    
outstanding Options pursuant to the 1994 Stock Option Plan and (iii) 46,500     
Shares were reserved for issuance upon exercise of outstanding Options pursuant 
to the 1994 Non-Employee Director Stock Option Plan. Except as set forth above  
or on Schedule 3.3 of the Company Disclosure Schedule, as of the date of this   
Agreement: (i) no shares of capital stock or other voting securities of the     
Company are issued, reserved for issuance or outstanding; (ii) there are no     
stock appreciation rights, phantom stock units, restricted stock grants,        
contingent stock grants or Benefit Plans which grant awards of any of the       
foregoing, and there are no other outstanding contractual rights to which the   
Company is a party the value of which is based on the value of Shares; (iii)    
all outstanding shares of capital stock of the Company are, and all of the      
Shares which may be exchanged for the Merger Consideration in the Merger will   
be, when so exchanged, duly authorized, validly issued, fully paid and          
nonassessable and not subject to preemptive rights; and (iv) there are no       
bonds, debentures, notes or other indebtedness of the Company having the right  
to vote (or convertible into, or exchangeable for, securities having the right  
to vote) on any matters on which stockholders of the Company may vote. Except   
as set forth above, as of the date of this Agreement, there are no outstanding  
securities, options, warrants, calls, rights, commitments, agreements,          
arrangements or undertakings of any kind to which the Company or any of its     
Subsidiaries is a party or by which any of them is bound obligating the Company 
or any of its Subsidiaries to issue, deliver or sell, or cause to be issued,    
delivered or sold, additional shares of capital stock or other voting           
securities of the Company or of any of its Subsidiaries or obligating the       
Company or any of its Subsidiaries to issue, grant, extend or enter into any    
such security, option, warrant, call, right, commitment, agreement, arrangement 
or undertaking. Except as set forth in Schedule 3.3 of the Company Disclosure   
Schedule, there are no programs in place, nor any outstanding contractual       
obligations of the Company or any of its Subsidiaries, to repurchase, redeem or 
otherwise acquire any shares of capital stock of the Company or any of its      
Subsidiaries.                                                                   

3.4. Authority; Noncontravention; Company Action. The Company has the     
requisite corporate power and authority to enter into this Agreement and,       
subject to approval of this Agreement by the holders of a majority of the       
outstanding Shares, to consummate the Merger contemplated by this Agreement.    
The execution and delivery of this Agreement by the Company and the             
consummation by the Company of the Transactions contemplated by this Agreement  
have been duly authorized by all necessary corporate action on the part of the  
Company, subject, in the case of the Merger, to approval of this Agreement by   
the holders of a majority of the outstanding Shares. The Board of Directors of  
the Company has unanimously approved this Agreement and the Merger for purposes 
of Section 203 of the DGCL (the "Section 203 Approval"). This Agreement has     
been duly executed and delivered by the Company and, assuming this Agreement    
constitutes the valid and binding obligation of Parent and Merger Sub,          
constitutes the valid and binding obligation of the Company, enforceable        
against the Company in accordance with its terms, except that (i) such          
enforcement may be subject to bankruptcy, insolvency, reorganization,           
moratorium or other similar Laws now or hereafter in effect relating to         
creditors' fights generally and (ii) the remedy of specific performance and     
injunctive relief may be subject to equitable defenses and to the discretion of 
the court before which any proceeding therefor may be brought. Except as set    
forth in Schedule 3.4 of the Company Disclosure Schedule, the execution and     
delivery of this Agreement do not, and the consummation of the Transactions     
contemplated by this Agreement including the execution and delivery of the      
Voting Agreement and compliance with the provisions of this Agreement will not, 
conflict with, or result in any violation of, or default (with or without       
notice or lapse of time, or both) under, or give rise to a right of             
termination, cancellation or acceleration of any obligation or loss of a        
material benefit under, or result in the creation of any Lien upon any of the   
properties or assets of the Company or any of its Subsidiaries under, (i) the   
Certificate of Incorporation or By-laws of the Company or the comparable        
charter or organizational documents of any of its Subsidiaries, (ii) any loan   
or credit agreement, note, bond,                                                

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mortgage, indenture, lease or other agreement, instrument or Permit applicable  
to the Company or any of its Subsidiaries or their respective properties or     
assets or (iii) any Law applicable to the Company or any of its Subsidiaries or 
their respective properties or assets, other than, in the case of clauses (ii)  
or (iii), any such conflicts, violations, defaults, rights or Liens that,       
individually or in the aggregate, would not (x) impair in any material respect  
the ability of the Company to perform its obligations under this Agreement or   
(y) have a Material Adverse Effect on the Company. No consent, approval, order  
or authorization of, or registration, declaration or filing with, any           
Governmental Entity is required by the Company or any of its Subsidiaries in    
connection with the execution and delivery of this Agreement by the Company or  
the consummation by the Company of the Transactions contemplated by this        
Agreement, except for (i) the filing of a premerger notification and report     
form by the Company under the Hart-Scott-Rodino Antitrust Improvements Act of   
1976, as amended (the "HSR Act"), (ii) the filing with the SEC of (x) a         
preliminary Proxy Statement, (y) a definitive Proxy Statement and (z) such      
reports under Section 13(a) of the Exchange Act as may be required in           
connection with this Agreement and the Transactions contemplated by this        
Agreement, (iii) the filing of the Certificate of Merger with the Secretary of  
State and appropriate documents with the relevant authorities of other states   
in which the Company is qualified to do business, (iv) as may be required by    
any applicable state securities or "blue sky" Laws, (v) such filings as may be  
required under the Connecticut Transfer Act, Conn. Gen. Stat. (S)(S)22a-134 et  
seq. and (vi) such other consents, approvals, orders, authorizations,           
registrations, declarations and filings the failure of which to be obtained or  
made would not, individually or in the aggregate, (x) impair, in any material   
respect, the ability of the Company to perform its obligations under this       
Agreement or (y) have a Material Adverse Effect on the Company.                 

  3.5. SEC Documents; Financial Statements. The Company has filed all reports,
proxy statements, forms, and other documents required to be filed by it with    
the SEC under the Securities Act and the Exchange Act since March 30, 1996 (the 
"SEC Documents"). As of their respective dates, (i) the SEC Documents complied  
in all material respects with the requirements of the Securities Act of 1933,   
as amended (the "Securities Act"), or the Exchange Act, as the case may be, and 
the rules and regulations of the SEC promulgated thereunder applicable to such  
SEC Documents, and (ii) none of the SEC Documents contained at the time of      
their filing an untrue statement of a material fact or omitted to state a       
material fact required to be stated therein or necessary in order to make the   
statements therein, in light of the circumstances under which they were made,   
not misleading. The financial statements of the Company included in the SEC     
Documents are true and complete and complied at the time of their filing as to  
form in all material respects with applicable accounting requirements and the   
published rules and regulations of the SEC with respect thereto, have been      
prepared in accordance with generally accepted accounting principles ("GAAP")   
applied on a consistent basis during the periods involved (except as may be     
indicated in the notes thereto) and fairly present in all material respects the 
consolidated financial position of the Company and its consolidated             
Subsidiaries as of the dates thereof and the consolidated results of their      
operations and cash flows for the periods then ended (subject, in the case of   
unaudited statements, to normal year-end audit adjustments). Except as set      
forth in Schedule 3.5 of the Company Disclosure Schedule and except as set      
forth in the SEC Documents filed and publicly available prior to the date of    
this Agreement, and except for liabilities and obligations incurred in the      
ordinary course of business consistent with past practice since the date of the 
most recent consolidated balance sheet included in the SEC Documents filed and  
publicly available prior to the date of this Agreement, neither the Company nor 
any of its Subsidiaries has any material liabilities or obligations of any      
nature (whether accrued, absolute, contingent or otherwise) required by         
generally accepted accounting principles to be set forth on a consolidated      
balance sheet of the Company and its consolidated Subsidiaries or in the notes  
thereto.                                                                        

3.6. Information Supplied. None of the information supplied or to be      
supplied by the Company expressly for inclusion or incorporation by reference   
in the Proxy Statement, will, on the date the Proxy Statement is first mailed   
to the Company's stockholders and at the time of the Special Meeting, contain   
any untrue statement of a material fact or omit to state any material fact      
required to be stated therein or necessary in order to make the statements      
therein, in light of the circumstances under which they are made, not false or  
misleading. The Proxy Statement will comply as to form in all material respects 
with the Exchange Act and the rules and regulations thereunder, except that no  
representation or warranty is made by the Company with respect to statements    
made                                                                            

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or incorporated by reference therein based on written information supplied by   
Parent or Merger Sub specifically for inclusion or incorporation by reference   
therein.                                                                        

3.7. Absence of Certain Changes or Events. Except as set forth in the SEC 
Documents or Schedule 3.7 of the Company Disclosure Schedule, since January 2,  
1999, (i) the Company and its Subsidiaries have conducted their respective      
businesses only in the ordinary course, there has not been any Material Adverse 
Change in the Company and (ii) neither the Company nor any of its Subsidiaries  
has amended its Certificate of Incorporation or By-laws; (iii) the Company has  
not split, combined or reclassified the Shares or any capital stock of any of   
its Subsidiaries; (iv) neither the Company nor any of its Subsidiaries has      
declared or set aside or paid any dividend or other distribution payable in     
cash, stock or property with respect to the Company's capital stock or that of  
any of its Subsidiaries (other than dividends or advances from a wholly-owned   
Subsidiary of the Company to its parent or the Company); (v) neither the        
Company nor any of its Subsidiaries has entered into any employment or          
severance agreement with any officer, director or key employee of the Company   
or any of its Subsidiaries; (vi) neither the Company nor any of its             
Subsidiaries has increased in any manner the compensation or fringe benefits    
of, or paid any bonus to, any director or officer thereof; and (vii) neither    
the Company nor any of its Subsidiaries has changed its accounting methods,     
except as required by GAAP or the SEC.                                          

  3.8. Litigation. Except as set forth in the SEC Documents or Schedule 3.8 of
the Company Disclosure Schedule or to the extent reserved for as reflected on   
the Company's financial statements for the year ended March 28, 1998, there are 
(i) no suits, actions or proceedings pending or, to the knowledge of the        
Company, threatened against the Company or any of its Subsidiaries that,        
individually or in the aggregate, would reasonably be expected to have a        
Material Adverse Effect, (ii) no complaints, lawsuits, charges or other         
proceedings pending or, to the knowledge of the Company, threatened in any      
forum by or on behalf of any present or former employee of the Company or any   
of its Subsidiaries, any applicant for employment or classes of the foregoing   
alleging breach of any express or implied contract of employment, any           
applicable Law governing employment or the termination thereof or other         
discriminatory, wrongful or tortious conduct in connection with the employment  
relationship that, individually or in the aggregate, would reasonably be        
expected to have a Material Adverse Effect, (iii) no judgments, decrees,        
injunctions or orders of any Governmental Entity or arbitrator outstanding      
against the Company that, individually or in the aggregate, could reasonably be 
expected to have a Material Adverse Effect on the Company; and (iv) none of the 
Intellectual Property Rights is subject to any order, writ, judgment,           
injunction, decree, determination or award that has, or would have, a Material  
Adverse Effect on the Company.                                                  

3.9. Absence of Changes in Benefit Plans; SEC Disclosure. Except as       
disclosed in the SEC Documents or Schedule 3.9 of the Company Disclosure        
Schedule, there has not been any adoption or material amendment by the Company  
or any of its Subsidiaries or any ERISA Affiliate (as defined in Section 3.10   
hereof) of any Benefit Plan (as defined in Section 3.10 hereof) since March 28, 
1998. Except as disclosed in Schedule 3.9 of the Company Disclosure Schedule,   
neither the Company nor any of its Subsidiaries has any formal plan or          
commitment to create any additional Benefit Plan or modify or change in any     
material respect any existing Benefit Plan that would affect any employee or    
terminated employee of the Company or a Subsidiary of the Company. Except as    
disclosed in Schedule 3.9 of the Company Disclosure Schedule, all employment,   
consulting, severance, termination, change in control or indemnification        
agreements, arrangements or understandings between the Company or any of its    
Subsidiaries and any current or former officer or director of the Company or    
any of its Subsidiaries which are required to be disclosed in the SEC Documents 
have been disclosed therein.                                                    

3.10. Employee Benefits; ERISA.                                           

  (a) Schedule 3.10 of the Company Disclosure Schedule contains a true and
complete list of each material bonus, deferred compensation, incentive      
compensation, stock purchase, stock option, employment, severance or        
termination pay, health insurance, supplemental unemployment benefits,      
profit-sharing, pension, or retirement plan, program, agreement or          
arrangement, and each other employee benefit                                

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plan, program, agreement or arrangement, other than a non-material fringe   
benefit plan, sponsored, maintained or contributed to or required to be     
contributed to (at any time during the past six years) by the Company or    
any of its Subsidiaries or by any trade or business, whether or not         
incorporated (an "ERISA Affiliate"), that is a member of a "controlled      
group" within the meaning of section 4001 of the Employee Retirement Income 
Security Act of 1974, as amended, and the rules and regulations promulgated 
thereunder ("ERISA") of which the Company or a Subsidiary is a member or    
which is under "common control" within the meaning of Section 4001 of       
ERISA, with the Company or a Subsidiary, for the benefit of any employee or 
terminated employee of the Company, its Subsidiaries or any ERISA           
Affiliate, whether formal or informal (the "Benefit Plans").                

(b) With respect to each Benefit Plan, the Company has delivered to   
Parent a true and complete copy thereof (including all amendments thereto), 
as well as true and complete copies of the two most recent annual reports,  
if required under ERISA, with respect thereto; the two most recent          
actuarial reports, if required under ERISA, with respect thereto; the two   
most recent reports prepared with respect thereto in accordance with        
Statement of Financial Accounting Standards No. 87, Employer's Accounting   
for Pensions; the most recent Summary Plan Description, together with each  
Summary of Material Modifications, if required under ERISA with respect     
thereto; if the Benefit Plan is funded through a trust or any third party   
funding vehicle, the trust or other funding agreement (including all        
amendments thereto) and the latest financial statements thereof; and the    
most recent determination letter received from the Internal Revenue Service 
with respect to each Benefit Plan that is intended to be qualified under    
section 401 of the Internal Revenue Code of 1986, as from time to time      
amended (the "Code").                                                       

  (c) No Benefit Plan is subject to Section 412 of the Code or Title IV of
ERISA.                                                                      

(d) Neither the Company, nor any Subsidiary of the Company, nor any   
trust created thereunder, nor any trustee or administrator thereof has      
engaged in a transaction in connection with which the Company or any        
Subsidiary of the Company, any such trust, or any trustee or administrator  
thereof, or any party dealing with any Benefit Plan or any such trust could 
be subject to either a civil penalty assessed pursuant to section 409 or    
502(i) of ERISA or a tax imposed pursuant to section 4975 or 4976 of the    
Code.                                                                       

(e) No Benefit Plan is a "multiemployer pension plan," as such term is
defined in section 3(37) of ERISA.                                          

(f) Each Benefit Plan which is intended to be "qualified" within the  
meaning of section 401 (a) of the Code is so qualified and the trusts       
maintained thereunder are exempt from taxation under section 501 (a) of the 
Code and no event has occurred to cause the loss of such qualified or       
exempt status.                                                              

(g) Except as set forth in Schedule 3.10 of the Company Disclosure    
Schedule, no Benefit Plan provides health, death or medical benefits        
(whether or not insured) with respect to current or former employees of the 
Company or its Subsidiaries beyond their retirement or other termination of 
service (other than (a) coverage mandated by applicable Law or (b) benefits 
the full cost of which is borne by the current or former employee (or his   
beneficiary)).                                                              

(h) Except as set forth in Schedule 3.10 of the Company Disclosure    
Schedule, the consummation of the Transactions contemplated by this         
Agreement, alone, will not (a) entitle any current or former employee or    
officer of the Company or any Subsidiary to severance pay, unemployment     
compensation or any other payment, (b) accelerate the time of payment or    
vesting, or increase the amount of compensation due any such employee or    
officer, (c) result in any prohibited transaction described in section 406  
of ERISA or section 4975 of the Code for which an exemption is not          
available, or (d) require the Company or any ERISA Affiliate to fund or     
make any payments to any trust or other funding vehicle in respect of any   
Benefit Plan.                                                               

(i) There are no pending, anticipated or, to the knowledge of the     
Company, threatened claims by or on behalf of any Benefit Plan, by any      
employee or beneficiary covered under any such Benefit Plan, or otherwise   
involving any such Benefit Plan (other than routine claims for benefits).   

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3.11. Taxes.                                                              

Except as set forth on Schedule 3.11 of the Company Disclosure Schedule:  

(a) Each of the Company and each of its Subsidiaries has timely filed 
(or has had timely filed on its behalf) all income Tax Returns and all      
other material Tax Returns required to be filed by it, and all such Tax     
Returns are true, complete and correct in all material respects. Each of    
the Company and each of its Subsidiaries has paid (or has had paid on its   
behalf) all income Taxes and all other material Taxes due and payable with  
respect to periods for which Tax Returns were filed (whether or not shown   
as due on such Tax Returns). The most recent financial statements contained 
in the SEC Documents reflect adequate reserves in accordance with generally 
accepted accounting principles for all Taxes not yet paid.                  

  (b) Each of the Company and each of its Subsidiaries has complied in all
material respects with all applicable Laws relating to the payment and      
withholding of taxes (including, without limitation, the withholding of     
Taxes pursuant to Sections 1441 and 1442 of the Code or similar provisions  
under any applicable foreign Laws) and have, within the time and in the     
manner prescribed by applicable Laws, withheld from employee wages and paid 
over to the proper Governmental Entity all material amounts required to be  
so withheld and paid over under all applicable Laws.                        

(c) No deficiencies for any Taxes have been proposed, asserted or     
assessed (in writing) against the Company or any of its Subsidiaries, (ii)  
no governmental authority is conducting an audit with respect to income     
Taxes or any other material Taxes or any Tax Return of the Company or any   
of its Subsidiaries, (iii) no extension or waiver of the statute of         
limitations with respect to Taxes or any Tax Return has been granted by the 
Company or any of its Subsidiaries, which remains in effect, (iv) none of   
the Company or any of its Subsidiaries is a party to any agreement or       
arrangement to allocate, share or indemnify another party for Taxes, and    
(v) there are no Liens for Taxes upon the assets of the Company or any of   
its Subsidiaries, except for Liens for Taxes not yet due.                   

 (d) The Company is not, and has not been, a United States Real Property
Holding Corporation (as defined in Section 897(c)(2) of the Code) on any    
"determination date" (as defined in Section 1.897-2(c) of the Treasury      
regulations promulgated under the Code).                                    

3.12. No Excess Nondeductible Payments.                                   

(a) Except as set forth in Schedule 3.12 of the Company Disclosure    
Schedule, no amounts payable as a result of the Transactions contemplated   
by this Agreement under the Benefit Plans or any other plans or             
arrangements will constitute a "parachute payment" to a "disqualified       
individual" as those terms are defined in Section 280G of the Code, without 
regard to whether such payment is reasonable compensation for personal      
services performed or to be performed in the future.                        

(b) Neither the Company nor any of its Subsidiaries is a party to any 
contract, agreement or other arrangement which could result in the payment  
of amounts that could be nondeductible by reason of Section 162(m) of the   
Code.                                                                       

3.13. Compliance with Applicable Laws.                                    

  Except (i) as set forth in the SEC Documents or Schedule 3.13 of the Company
Disclosure Schedule or (ii) where a Material Adverse Effect on the Company      
would not result, to the knowledge of the Company:                              

(a) The Company and each of its Subsidiaries are presently complying  
with all applicable Laws, and neither the Company nor any of its            
Subsidiaries has received written notification of any asserted present or   
past failure to so comply.                                                  

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  (b) Each of the Company and its Subsidiaries has in effect or has timely
filed applications for all Permits necessary for it to own, lease or        
operate its properties and assets and to carry on its business              
substantially as now conducted, there are no appeals nor any other actions  
pending to revoke any such Permits, and there has occurred no default or    
violation under any such Permits.                                           

(c) Each of the Company and its Subsidiaries is, and has been, in     
compliance with all applicable Environmental Laws. There are no             
circumstances or conditions that would be reasonably likely to prevent or   
interfere with compliance by the Company or its Subsidiaries in the future  
with Environmental Laws (or Permits issued thereunder).                     

(d) Neither the Company nor any Subsidiary of the Company has received
any written claim, demand, notice, complaint, court order, administrative   
order or request for information from any Governmental Entity or private    
party, alleging violation of, or asserting any noncompliance with or        
liability under or potential liability under, any Environmental Laws,       
except for matters which are no longer threatened or pending or for which   
the Company or its Subsidiaries are not subject to further requirements     
pursuant to an administrative or court order, judgment, or a settlement     
agreement.                                                                  

(e) During the period of ownership or operation by the Company and its
Subsidiaries of any of their respective current or previously owned or      
leased properties, there have been no Releases of Hazardous Material in,    
on, under or affecting such properties and none of the Company or its       
Subsidiaries have disposed of any Hazardous Material or any other substance 
either on said owned or leased properties or at other properties, in a      
manner that has led, or could reasonably be anticipated to lead to a        
Release. Prior to the period of ownership or operation by the Company and   
its Subsidiaries of any of their respective current or previously owned or  
leased properties, no Hazardous Material was disposed of at such current or 
previously owned or leased properties, and there were no Releases of        
Hazardous Material in, on, under or affecting any such property.            

(f) Except for leases entered into in the ordinary course of business,
as to which no notice of a claim for indemnity or reimbursement has been    
received by the Company, neither the Company nor any of its Subsidiaries    
has entered into an agreement that may require it to pay to, reimburse,     
guarantee, pledge, defend, indemnify, or hold harmless any Person for or    
against any liabilities, damages or costs under or pursuant to              
Environmental Laws.                                                         

 (g) Neither the Company nor any of its Subsidiaries has treated, stored
or disposed of "hazardous waste", as that term is defined in the Resource   
Conservation and Recovery Act, 42 U.S.C. (S) 6901 et seq., analogous state  
Laws, or the regulations promulgated thereunder, such that the Company or   
any of its Subsidiaries would be required to obtain a Permit under said     
Laws for such treatment, storage or disposal.                               

(h) The Company has provided to Parent true and correct copies of all 
environmental studies and reports in its possession, prepared within the    
last five years, relating to (i) the Company's and its Subsidiaries'        
compliance with Environmental Laws; (ii) the environmental condition of the 
Company's and its Subsidiaries' currently owned or leased properties,       
including, but not limited to, the extent of any on-site contamination at   
any of such properties, results of investigations at such properties,       
remedial action plans for such properties, and asbestos surveys; and (iii)  
the environmental condition of any properties formerly owned or operated by 
the Company or any of its Subsidiaries, or of any other location at which   
the Company or any of its Subsidiaries is subject to an environmental       
claim, including, but not limited to, the extent of any on-site             
contamination at any such properties, results of investigations at such     
properties, and remedial action plans at such properties.                   

 (i) The Company has provided Parent with true and correct copies of all
agreements, except for leases entered into in the ordinary course of        
business, by and between the Company and any party providing for or         
relating to the indemnification of, or the indemnification by, the Company  
for environmental claims (the "Environmental Agreements"), including, but   
not limited to (i) the Purchase and Sale Agreement dated as of May 7, 1986  
by and between the Company and Textron, Inc. and (ii) the Settlement        
Agreement dated as of June 22, 1994 by and between the Company and Textron, 
Inc. (such agreements with Textron, Inc. are hereinafter referred to        
collectively as the "Textron Agreements").                                  

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3.14. Intellectual Property.                                              

(a) Except as set forth on Schedule 3.14(a) of the Company Disclosure 
Schedule, the Company and/or its Subsidiaries own free and clear of all     
Liens other than Permitted Liens, or is licensed or otherwise possesses     
legally enforceable rights to use, all patents and all material trademarks  
(registered or unregistered) service marks (registered or unregistered),    
trade names, and copyrights and applications for any of the foregoing,      
computer software, inventions, designs, know-how and other proprietary      
rights (collectively, the "Intellectual Property Rights") that are          
necessary to the business of the Company and its Subsidiaries as currently  
conducted.                                                                  

(b) Schedule 3.14(b) of the Company Disclosure Schedule sets forth a  
list of all patents, patent applications, registered trademarks, pending    
trademark applications, registered copyrights and material common law       
trademarks owned by the Company or any of its Subsidiaries.                 

(c) Schedule 3.14(c) of the Company Disclosure Schedule sets forth a  
list of all material licensing agreements to which the Company or any of    
its Subsidiaries is a party relating to the use of the Intellectual         
Property Rights.                                                            

(d) Each of the Company and each of its Subsidiaries owns or has the  
right to use the Intellectual Property Rights in order to allow it to       
conduct, and continue to conduct, its business as currently conducted in    
all material respects, and the consummation of the Transactions             
contemplated hereby will not alter or impair such ability, except where     
such alteration or impairment would not have a Material Adverse Effect on   
the Company.                                                                

(e) Except as set forth on Schedule 3.14(e) of the Company Disclosure 
Schedule, (i) to the knowledge of the Company and its Subsidiaries, there   
are no pending oppositions, cancellations, invalidity proceedings,          
interferences or re-examination proceedings with respect to the             
Intellectual Property Rights, (ii) to the knowledge of the Company and its  
Subsidiaries, neither the Company nor any of its Subsidiaries has received  
any written notice from any other Person pertaining to or challenging the   
right of the Company or any of its Subsidiaries to use any of the           
Intellectual Property Rights and (iii) neither the Company nor any of its   
Subsidiaries has made any claim or has knowledge of a violation or          
infringement by others of its rights to or in connection with the           
Intellectual Property Rights which is still pending.                        

3.15. Properties.                                                         

(a) Each of the Company and each of its Subsidiaries has sufficiently 
good and valid title to, or an adequate leasehold interest in, its material 
properties and assets (including the Real Property) in order to allow it to 
conduct, and continue to conduct, its business as currently conducted in    
all material respects. Except as set forth in Schedule 3.15 of the Company  
Disclosure Schedule, such material tangible properties and assets           
(including the Real Property) are sufficiently free of Liens to allow each  
of the Company and each of its Subsidiaries to conduct, and continue to     
conduct, its business as currently conducted in all material respects and   
the consummation of the Transactions contemplated by this Agreement will    
not alter or impair such ability so as to cause a Material Adverse Effect   
on the Company. Each of the Company and each of its Subsidiaries enjoys     
peaceful and undisturbed possession under all leases, except for such       
breaches of the right to peaceful and undisturbed possession that do not    
materially interfere with the ability of the Company and its Subsidiaries   
to conduct its business as currently conducted. Schedule 3.15 of the        
Company Disclosure Schedule sets forth a complete list of all real property 
and material interests in real property owned in fee by the Company or one  
of its Subsidiaries (the "Fee Properties") and sets forth all real property 
and interests in real property leased by the Company or one of its          
Subsidiaries as of the date hereof (the "Leased Properties," together with  
the Fee Properties, the "Real Property"). Schedule 3.15 also sets forth all 
locations at which properties of the Company and its Subsidiaries are       
located, temporarily or permanently, including all warehouses or similar    
Third Party storage or staging facilities for such properties.              

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  (b) All leases executed by the Company or its Subsidiaries as lessee for
the Leased Properties are in full force and effect and, except as set forth 
on Schedule 3.15 of the Company Disclosure Schedule, the Company and its    
Subsidiaries have received no written notices of default from any landlord  
which default remains uncured as of the date hereof, and to their           
knowledge, neither the Company nor its Subsidiaries is in default in any    
material respect under any such leases.                                     

 (c) All leases executed by the Company or its Subsidiaries as lessor or
sublessor for the Real Property are in full force and effect and, except as 
set forth on Schedule 3.15 of the Company Disclosure Schedule, there exist  
no other tenants of the Real Property, the Company and its Subsidiaries     
have received no written notices of default from any tenant which default   
remains uncured as of the date hereof, and to the knowledge of the Company  
and its Subsidiaries, no such tenant is in material default under any such  
leases.                                                                     

(d) Except as set forth on Schedule 3.15 of the Company Disclosure    
Schedule, the Company and/or its Subsidiaries have good, valid, marketable  
and fee simple title to all the Fee Property, free and clear of all Liens   
other than Permitted Liens.                                                 

(e) Except as set forth on Schedule 3.15 of the Company Disclosure    
Schedule, all of the Real Properties have connections to sanitary sewer,    
water, electricity, gas, telephone and all other necessary utilities and    
the Company and/or its Subsidiaries do not know of any existing             
circumstances or conditions which would result in a termination of such     
access or connections for any period of time which termination would result 
in a Material Adverse Effect on the Company.                                

(f) Except as set forth on Schedule 3.15 of the Company Disclosure    
Schedule or where a Material Adverse Effect on the Company would not        
result, to the knowledge of the Company, no fact or condition exists which  
would prohibit adequate rights of access to and from the Real Properties    
from and to public highways and roads, and the Company and its Subsidiaries 
have not received written notice of any pending or threatened restriction   
or denial, governmental or otherwise, upon such ingress or egress which     
would adversely affect the operation of the Real Properties.                

3.16. Contracts.                                                          

(a) Except as set forth in the SEC Documents or Schedule 3.16 of the  
Company Disclosure Schedule, neither the Company nor any of its             
Subsidiaries is a party to or bound by (i) any "material contract" (as such 
term is defined in Item 601(b)(10) of Regulation S-K of the SEC), (ii) any  
non-competition agreement or any other agreement or obligation which        
purports to limit in any respect the manner in which, or the localities in  
which, all or any material portion of the business of the Company and its   
Subsidiaries, taken as a whole, may be conducted, (iii) any agreement with  
any Affiliate of the Company, (iv) any voting or other agreement governing  
how any Shares shall be voted or (v) any agreement with any holder of 10%   
or more of the Shares (all contracts of the type described in clauses (i),  
(ii), (iii), (iv) or (v) being referred to herein as "Company Material      
Contracts"). Each Company Material Contract is valid and binding on the     
Company (or, to the extent a Subsidiary of the Company is a party, such     
Subsidiary) and is in full force and effect, and the Company and each       
Subsidiary of the Company have, in all material respects, performed all     
obligations required to be performed by them to date under each Company     
Material Contract, except where such noncompliance, individually or in the  
aggregate, would not have a Material Adverse Effect on the Company. Neither 
the Company nor any Subsidiary of the Company knows of, or has received     
notice of, any violation or default under (nor, to the knowledge of the     
Company, does there exist any condition which with the passage of time or   
the giving of notice or both would result in such a violation or default    
under) any Company Material Contract, except where such violation or        
defaults, individually or in the aggregate, would not have a Material       
Adverse Effect on the Company.                                              

 (b) Except as disclosed in the SEC Documents or in Schedule 3.16 of the
Company Disclosure Schedule or as provided for in this Agreement, neither   
the Company nor any of its Subsidiaries is a party to any oral or written   
(i) employment or consulting agreements not terminable on thirty (30) days' 
or less                                                                     

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notice, (ii) union or collective bargaining agreement, (iii) agreement with 
any executive officer or other key employee of the Company or any of its    
Subsidiaries the benefits of which are contingent or vest, or the terms of  
which are materially altered, upon the occurrence of a transaction          
involving the Company or any of its Subsidiaries of the nature contemplated 
by this Agreement, (iv) agreement with respect to any executive officer or  
other key employee of the Company or any of its Subsidiaries providing any  
term of employment or compensation guarantee or (v) agreement or plan,      
including any stock option, stock appreciation right, restricted stock or   
stock purchase plan, any of the benefits of which will be increased, or the 
vesting of the benefits of which will be accelerated, by the occurrence of  
any of the transactions contemplated by this Agreement or the value of any  
of the benefits of which will be calculated on the basis of any of the      
transactions contemplated by this Agreement.                                

3.17. Labor Relations. Except to the extent set forth in the SEC Documents
or Schedule 3.17 of the Company Disclosure Schedule, (i) the Company and each   
of its Subsidiaries is, and has at all times been, in material compliance with  
all applicable Laws respecting employment and employment practices, terms and   
conditions of employment, wages, hours of work and occupational safety and      
health, and is not engaged in any unfair labor practices as defined in the      
National Labor Relations Act or other applicable Law, except where the failure  
to comply would not be reasonably likely to cause a Material Adverse Effect on  
the Company; (ii) there is no labor strike, slowdown, stoppage or lockout       
actually pending, or, to the knowledge of the Company, threatened against the   
Company or any of its Subsidiaries; and (iii) neither the Company nor any of    
its Subsidiaries is a party to or bound by any collective bargaining or similar 
agreement with any labor organization.                                          

3.18. Products Liability. Except as set forth in Schedule 3.18 of the     
Company Disclosure Schedule, (i) there is no claim, action, suit or proceeding  
pending before any Governmental Entity against the Company or any Subsidiary of 
the Company in which a Product is alleged to have a Defect; and (ii) to the     
knowledge of the Company and its Subsidiaries, no such claim, action, suit or   
proceeding is threatened; other than claims, actions, suits or proceedings      
referred to in clause (i) or (ii) of this Section 3.18 that would not, if       
adversely determined, have, individually or in the aggregate, a Material        
Adverse Effect on the Company.                                                  

  3.19. Transactions with Affiliates. Except as disclosed in the SEC Documents
or Schedule 3.19 of the Company Disclosure Schedule, since March 28, 1998,      
there have been no transactions, agreements, arrangements or understandings     
between the Company and its Affiliates that would be required to be disclosed   
under Item 404 of Regulation S-K under the Securities Act.                      

 3.20. Applicability of State Takeover Statutes. The Section 203 Approval is
valid and in full force and effect. Section 203 of the DGCL will not apply to   
the Voting Agreement or the Merger. No other state takeover statute or similar  
statute or regulation applies or purports to apply to the Merger or the other   
Transactions.                                                                   

  3.21. Voting Requirements. The affirmative vote of the holders of a majority
of all the Shares entitled to vote approving this Agreement is the only vote of 
the holders of any class or series of the Company's capital stock necessary to  
approve this Agreement and the Transactions contemplated by this Agreement.     

3.22. Brokers. No broker, investment banker, financial advisor or other   
Person, other than Lehman Brothers Inc., the fees and expenses of which will be 
paid by the Company, is entitled to any broker's, finder's, financial           
advisor's, or other similar fee or commission in connection with the            
Transactions contemplated by this Agreement based upon arrangements made by or  
on behalf of the Company. The Company has disclosed to Parent its fee           
arrangements with Lehman Brothers Inc. and has provided Parent with true,       
correct and complete copies of any agreements with respect to its fee           
arrangements with Lehman Brothers Inc.                                          

 3.23. Opinion of Financial Advisor. The Company has received the opinion of
Lehman Brothers Inc., to the effect that, as of the date of this Agreement, the 
consideration to be received in the Merger by the Company's stockholders is     
fair to the Company's stockholders from a financial point of view, and a        
complete and correct signed copy of such opinion has been, or promptly upon     
receipt thereof will be, delivered to Parent.                                   

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 3.24. Full Disclosure. No representation or warranty by the Company in this
Agreement and no statement contained in the Company Disclosure Schedules or     
certificate furnished or to be furnished by the Company to Parent or any of its 
Representatives pursuant to the provisions hereof or in connection with the     
Transactions, contains or will contain any untrue statement of material fact or 
omits or will omit to state any material fact necessary, in light of the        
circumstances under which it was made, in order to make the statements herein   
or therein not misleading.                                                      

3.25. Year 2000.                                                          

(a) To the Company's knowledge, except as set forth on Schedule 3.25, 
all material computer-based systems and software of the Company and its     
Subsidiaries (collectively, the "Computer Systems") will record, store,     
process and present calendar dates falling on or after January 1, 2000 in   
the same manner and with the same functionality as such Computer Systems    
record, store, process and present calendar dates falling on or before      
December 31, 1999. To the Company's knowledge, except as set forth on       
Schedule 3.25, in all other respects, such Computer Systems shall not in    
any way lose functionality or degrade in performance as a consequence of    
such Computer Systems operating at a date later than December 31, 1999.     

(b) To the Company's knowledge, the projections and business plans    
provided to the Parent in connection with this Agreement reflect all        
expenses the Company and its Subsidiaries will reasonably need to incur in  
order to convert, rewrite or replace any Computer System or programs as set 
forth in Schedule 3.25 which are not currently Year 2000 Compliant          
(including performance of all reasonable and prudent testing) as soon as is 
practicable and, in any event, before the later of December 31, 1999 and    
the date such system or program is scheduled to be placed in operation.     

  (c) "Year 2000 Compliant" means all Computer Systems and programs of the
Company and its Subsidiaries (i) being designed to be used prior to, during 
and after calendar year 2000 without material error relating to date data,  
(ii) being capable of operating without material error relating to the      
production of the date data which represents or refers to different         
centuries or more than one century, and (iii) being designed so that all    
date data fields, date-related user interfaces, and other interfaces,       
include the indication of century.                                          

ARTICLE IV. 

Representations and Warranties of 
Parent and Merger Sub 

Parent and Merger Sub represent and warrant to the Company as follows:    

4.1. Organization, Standing and Corporate Power.                          

(a) Each of Parent and Merger Sub is a corporation duly organized,    
validly existing and in good standing under the Laws of the jurisdiction in 
which each is incorporated and has the requisite corporate power and        
authority to carry on its business as now being conducted. Each of Parent   
and Merger Sub is duly qualified or licensed to do business and is in good  
standing in each jurisdiction in which the nature of its business or the    
ownership or leasing of its properties makes such qualification or          
licensing necessary, other than in such jurisdictions where the failure to  
be so qualified or licensed (individually or in the aggregate) would not    
have a Material Adverse Effect on Parent.                                   

(b) Each of Hill-Loma, Inc., Bryant Grinder Corporation, Fellows      
Corporation, Jones & Lamson Vermont Corporation and J&L Metrology Company,  
Inc., all of which are organized under the Laws of the State of Delaware,   
are wholly-owned Subsidiaries, either directly or, in the case of J&L       
Metrology, Inc., indirectly, of Parent.                                     

4.2. Authority; Noncontravention. Parent and Merger Sub have the requisite
corporate power and authority to enter into this Agreement and to consummate    
the Transactions contemplated by this Agreement. The                            

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execution and delivery of this Agreement by Parent and Merger Sub and the       
consummation by Parent and Merger Sub of the Transactions contemplated by this  
Agreement have been duly authorized by all necessary corporate action on the    
part of Parent and Merger Sub, as applicable. This Agreement has been duly      
executed and delivered by Parent and Merger Sub and, assuming this Agreement    
constitutes the valid and binding obligation of the Company, constitutes a      
valid and binding obligation of each such party, enforceable against each such  
party in accordance with its terms, except that (i) such enforcement may be     
subject to bankruptcy, insolvency, reorganization, moratorium or other similar  
Laws now or hereafter in effect relating to creditors' rights generally and     
(ii) the remedy of specific performance and injunctive relief may be subject to 
equitable defenses and to the discretion of the court before which any          
proceeding therefor may be brought. The execution and delivery of this          
Agreement do not, and the consummation of the Transactions contemplated by this 
Agreement will not, conflict with, or result in any violation of, or default    
(with or without notice or lapse of time, or both) under, or give rise to a     
right of termination, cancellation or acceleration of any obligation or to loss 
of a material benefit under, or result in the creation of any lien upon any of  
the properties or assets of Parent under, (i) the certificate of incorporation  
or by-laws of Parent or Merger Sub, (ii) any Law applicable to Parent or Merger 
Sub or their respective properties or assets, other than, in the case of clause 
(ii), any such conflicts, violations, defaults, rights or Liens that            
individually or in the aggregate would not (x) impair in any material respect   
the ability of Parent and Merger Sub to perform their respective obligations    
under this Agreement or (y) prevent or impede the consummation of any of the    
Transactions contemplated by this Agreement. No consent, approval, order or     
authorization of, or registration, declaration or filing with, any Governmental 
Entity or any other Person is required by Parent or Merger Sub in connection    
with the execution and delivery of this Agreement or the consummation by Parent 
or Merger Sub, as the case may be, of any of the Transactions contemplated by   
this Agreement, except for (i) the filing of a premerger notification and       
report form under the HSR Act, (ii) the filing with the SEC of such reports and 
statements under the Exchange Act as may be required in connection with this    
Agreement and the Transactions contemplated by this Agreement, (iii) the filing 
of the Certificate of Merger with the Secretary of State and appropriate        
documents with the relevant authorities of other states in which the Company is 
qualified to do business, (iv) as may be required by an applicable state        
securities or "blue sky" Laws, and (v) such other consents, approvals, orders,  
authorizations, registrations, declarations and filings the failure of which to 
be obtained or made would not, individually or in the aggregate, (x) impair, in 
any material respect, the ability of Parent to perform its obligations under    
this Agreement or (y) prevent or significantly delay the consummation of the    
Transactions contemplated by this Agreement.                                    

4.3. Information Supplied. None of the information supplied or to be      
supplied in writing by Parent or Merger Sub expressly for inclusion or          
incorporation by reference in the Proxy Statement will, on the date the Proxy   
Statement is first mailed to the Company's stockholders and at the time of the  
Special Meeting, contain any untrue statement of a material fact or omit to     
state any material fact required to be stated therein or necessary in order to  
make the statements therein, in light of the circumstances under which they are 
made, not misleading.                                                           

 4.4. Operations of Merger Sub. Merger Sub was formed solely for the purpose
of engaging in the Transactions contemplated hereby and has not engaged in any  
business activities or conducted any operations other than in connection with   
the Transactions contemplated hereby.                                           

4.5. Financing. Parent has obtained the financing commitments detailed in 
the commitment letters dated as of March 25, 1999 (the "Commitment"), true and  
correct copies of which have been previously delivered to the Company. Upon     
receipt of the funds contemplated by the Commitment, Parent will have           
sufficient funds to pay for the Shares acquired in the Merger.                  

4.6. Brokers. No broker, investment banker, financial advisor or other    
Person, other than ING Baring Furman Selz LLC and the parties to the            
Commitment, the fees and expenses of which will be paid by Parent, is entitled  
to any broker's, finder's, financial advisor's or other similar fee or          
commission in connection                                                        

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with the Transactions contemplated by this Agreement based upon arrangements    
made by or on behalf of Parent or Merger Sub.                                   

ARTICLE V.

Covenants 

5.1. Interim Operations of the Company. After the date hereof, except as  
specifically contemplated by this Agreement, the Company shall and shall cause  
its Subsidiaries to carry on their respective businesses in the ordinary course 
and use all reasonable best efforts consistent with good business judgment to   
preserve intact their current business organizations, keep available the        
services of their current officers and key employees and preserve their         
relationships consistent with past practice with desirable customers,           
suppliers, licensors, licensees, distributors and others having business        
dealings with them to the end that their goodwill and ongoing businesses shall  
be unimpaired in all material respects at the Effective Time. Without limiting  
the generality of the foregoing, the Company covenants and agrees that, except  
(i) as expressly contemplated by this Agreement, (ii) as set forth in Schedule  
5.1 of the Company Disclosure Schedule or (iii) as agreed in writing by Parent, 
after the date hereof:                                                          

(a) neither the Company nor any of its Subsidiaries shall, directly or
indirectly, amend its Certificate of Incorporation or By-laws or similar    
organizational documents;                                                   

(b) neither the Company nor any of its Subsidiaries shall: (i)(A)     
declare, set aside or pay any dividend or other distribution payable in     
cash, stock or property with respect to the Company's capital stock or that 
of its Subsidiaries, except that a wholly-owned Subsidiary of the Company   
may declare and pay a dividend or make advances to its parent or the        
Company or (B) redeem, purchase or otherwise acquire directly or indirectly 
any of the Company's capital stock or that of its Subsidiaries; (ii) issue, 
sell, pledge, dispose of or encumber any additional shares of, or           
securities convertible into or exchangeable for, or options, warrants,      
calls, commitments or rights of any kind to acquire, any shares of capital  
stock of any class of the Company or its Subsidiaries, other than Shares    
issued upon the exercise of Options outstanding on the date hereof in       
accordance with the Option Plans as in effect on the date hereof; or (iii)  
split, combine or reclassify the outstanding capital stock of the Company   
or of any of the Subsidiaries of the Company;                               

(c) except as permitted by this Agreement, neither the Company nor any
of its Subsidiaries shall acquire or agree to acquire (A) by merging or     
consolidating with, or by purchasing a substantial portion of the assets of 
or by any other manner, any business or any corporation, partnership, joint 
venture, association or other business organization or division thereof     
(including entities which are Subsidiaries of the Company or any of the     
Company's Subsidiaries) or (B) any assets, including real estate, except    
purchases in the ordinary course of business consistent with past practice  
and capital expenditures permitted under Section 5.l(d);                    

(d) neither the Company nor any of its Subsidiaries shall make any new
capital expenditure or expenditures in an aggregate amount exceeding        
$550,000, and provided such capital expenditures which do not exceed said   
$550,000 are set forth in Schedule 5.1 of the Company Disclosure Schedule;  

  (e) neither the Company nor any of its Subsidiaries shall, except in the
ordinary course of business and except as otherwise permitted by this       
Agreement, amend or terminate any contract or agreement where such          
amendment or termination would have a Material Adverse Affect on the        
Company, or waive, release or assign any material rights or claims;         

(f) neither the Company nor any of its Subsidiaries shall transfer,   
lease, license, sell, mortgage, pledge, dispose of, or encumber any         
material property or assets other than sales of products to customers or in 
the ordinary course of business and consistent with past practice;          

(g) neither the Company nor any of its Subsidiaries shall: (i) enter  
into any employment or severance agreement with or grant any severance or   
termination pay to any officer, director or key employee of the             

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Company or any its Subsidiaries; or (ii) hire or agree to hire any new or   
additional key employees or officers; provided that the Company may hire    
key employees to fill vacancies in positions created prior to the date      
hereof and listed on Schedule 5.1 of the Company Disclosure Schedule;       

(h) neither the Company nor any of its Subsidiaries shall, except as  
required to comply with applicable Law or expressly provided in this        
Agreement, (A) adopt, enter into, terminate, amend or increase the amount   
or accelerate the payment or vesting of any benefit or award or amount      
payable under any Benefit Plan or other arrangement for the current or      
future benefit or welfare of any director, officer or current or former     
employee, except to the extent necessary to coordinate any such Benefit     
Plans with the terms of this Agreement, (B) increase in any manner the      
compensation or fringe benefits of, or pay any bonus to, any director,      
officer or employee, except as set forth in Schedule 5.1, (C) pay any       
benefit not provided for under any Benefit Plan, other than employee        
salaries in the ordinary course of business consistent with past practice   
which is in excess of 1% of any employee's annual compensation, (D) grant   
any awards under any bonus, incentive, performance or other compensation    
plan or arrangement or Benefit Plan (including the removal of existing      
restrictions in any Benefit Plans or agreements or awards made thereunder)  
except as set forth in Schedule 5.1, (E) grant of stock options, stock      
appreciation rights, stock based or stock related awards, performance units 
or restricted stock, or (F) take any action to fund or in any other way     
secure the payment of compensation or benefits under any employee plan,     
agreement, contract or arrangement or Benefit Plan, except as set forth in  
Schedule 5.1;                                                               

 (i) neither the Company nor any of its Subsidiaries shall: (i) incur or
assume any long-term debt or, except in the ordinary course of business,    
incur or assume any short-term indebtedness (including advances under the   
Company's existing revolving credit agreement) in amounts not consistent    
with past practice; (ii) incur or modify any material indebtedness or other 
liability except as set forth in Schedule 5.1 of the Company Disclosure     
Schedule; (iii) assume, guarantee, endorse or otherwise become liable or    
responsible (whether directly, contingently or otherwise) for the           
obligations of any other Person; (iv) make any loans, advances or capital   
contributions to, or investments in, any other Person (other than to wholly 
owned Subsidiaries of the Company or to such entities which are listed in   
Schedule 3.2 of the Company Disclosure Schedule or customary loans or       
advances to employees or customers in the ordinary course of business in    
accordance with past practice); (v) settle any material claims; or (vi)     
enter into any material commitment or transaction unless it is in the       
ordinary course of business consistent with past practice and not otherwise 
specifically prohibited by this Section 5.1;                                

 (j) neither the Company nor any of its Subsidiaries shall change any of
the accounting principles used by it unless required by GAAP or the SEC;    

(k) neither the Company nor any of its Subsidiaries shall make any Tax
election, unless required by law, or settle or compromise any material Tax  
liability;                                                                  

  (l) neither the Company nor any of its Subsidiaries shall pay, discharge
or satisfy any claims, liabilities or obligations (absolute, accrued,       
asserted or unasserted, contingent or otherwise), other than (i) the        
payment, discharge or satisfaction of any such claims, liabilities or       
obligations in the ordinary course of business and consistent with past     
practice, (ii) the payment,. discharge or satisfaction of any such claims,  
liabilities or obligations in connection with the Transactions, (iii) the   
payment, discharge or satisfaction of any such claims, liabilities or       
obligations which in the aggregate do not exceed $100,000 and (iv) the      
payment, discharge or satisfaction of any such claims, liabilities or       
obligations which are reflected or reserved against in, or contemplated by, 
the consolidated financial statements (or the notes thereto) of the Company 
and its consolidated Subsidiaries and which in the aggregate do not exceed  
$100,000;                                                                   

  (m) neither the Company nor any of its Subsidiaries shall, except in the
ordinary course of business consistent with past practice, waive the        
benefits of, or agree to modify in any manner, any confidentiality,         
standstill or similar agreement to which the Company or any of its          
Subsidiaries is a party; and                                                

(n) neither the Company nor any of its Subsidiaries will enter into an
agreement, contract, commitment or arrangement to do any of the foregoing,  
or to authorize, recommend, propose or announce an intention to do any of   
the foregoing.                                                              

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  5.2. Access; Confidentiality. Upon reasonable notice, the Company shall (and
shall cause each of its Subsidiaries to) afford to the Representatives of       
Parent, including the Persons providing the Commitment, reasonable access,      
during normal business hours during the period after the date hereof and prior  
to the Effective Time, to such of its properties, personnel, books, contracts,  
commitments and records as Parent may reasonably request, and, during such      
period, the Company shall (and shall cause each of its Subsidiaries to) furnish 
promptly to Parent (a) a copy of each report, schedule, registration statement  
and other document filed or received by it during such period pursuant to the   
requirements of Federal or state securities Laws and (b) all other information  
concerning its business, properties and personnel as Parent may reasonably      
request. Notwithstanding anything in this Agreement to the contrary, neither    
Parent, its Representatives, nor any Person providing the Commitment shall have 
the right to conduct any environmental boring, sampling, testing, or a Phase II 
review at any of the properties of the Company or its Subsidiaries provided     
that such restriction shall not limit Parent's right to conduct any             
environmental investigation with respect to events occurring after the date     
hereof. Parent will remain bound by the terms of a confidentiality agreement    
with the Company, dated as of January 19, 1999 (the "Parent Confidentiality     
Agreement") and the Company will remain bound by the terms of a confidentiality 
agreement with Parent dated as of April 20, 1999 (the "Company Confidentiality  
Agreement"). Parent hereby acknowledges and agrees that all Persons providing   
the Commitment and the Representatives of such Persons are "Representatives" of 
Parent within the meaning of the Confidentiality Agreement.                     

5.3. Reasonable Efforts; Notification.                                    

(a) Upon the terms and subject to the conditions set forth in this    
Agreement, each of the parties agrees to use all reasonable efforts to      
take, or cause to be taken, all actions, and to do, or cause to be done,    
and to assist and cooperate with the other parties in doing, all things     
necessary, proper or advisable to consummate and make effective, in the     
most expeditious manner practicable, the Merger and the other Transactions  
contemplated by this Agreement, including (i) the obtaining of all          
necessary actions or nonactions, waivers, consents and approvals from any   
Governmental Entity and the making of all necessary registrations and       
filings (including filings with any Governmental Entity, if any) and the    
taking of all reasonable steps as may be necessary to obtain an approval or 
waiver from, or to avoid an action or proceeding by any Governmental        
Entity, (ii) the obtaining of all necessary consents, approvals or waivers  
from third parties, (iii) the defending of any lawsuits or other legal      
proceedings, whether judicial or administrative, challenging this Agreement 
or the consummation of any of the Transactions contemplated by this         
Agreement, including seeking to have any stay or temporary restraining      
order entered by any court or other Governmental Entity vacated or          
reversed, and (iv) the execution and delivery of any additional instruments 
necessary to consummate the Transactions contemplated by, and to fully      
carry out the purposes of, this Agreement; provided, however, that in       
connection with any filing or submission or other action required to be     
made or taken by any Party to effect the Merger and all other Transactions  
contemplated hereby, the Company shall not without the prior written        
consent of Parent commit to any divestiture transaction and Parent shall    
not be required to divest or hold separate or otherwise take or commence to 
take any action that, in the reasonable discretion of Parent, limits in any 
material respect its freedom of action with respect to, or its ability to   
retain, the Company or any of its affiliates or any material portion of the 
assets of the Company. In connection with and without limiting the          
foregoing, the Company and its Board of Directors shall (i) take all action 
necessary to ensure that no state takeover statute or similar statute or    
regulation is or becomes applicable to the Merger, this Agreement or any of 
the other Transactions contemplated by this Agreement and (ii) if any state 
takeover statute or similar statute or regulation becomes applicable to the 
Merger or this Agreement or any other transaction contemplated by this      
Agreement, take all action necessary to ensure that the Merger and the      
other Transactions contemplated by this Agreement may be consummated as     
promptly as practicable on the terms contemplated by this Agreement and     
otherwise to minimize the effect of such statute or regulation on the       
Merger, this Agreement and the other Transactions contemplated by this      
Agreement.                                                                  

 (b) Each of the Company, Parent and Merger Sub shall give prompt notice
to the other of (i) any of their representations or warranties contained in 
this Agreement becoming untrue or inaccurate in any                         

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respect (including in the case of representations or warranties receiving   
knowledge of any fact, event or circumstance which may cause any            
representation qualified as to the knowledge to be or become untrue or      
inaccurate in any respect) or (ii) the failure by them to comply with or    
satisfy in any material respect any covenant, condition or agreement to be  
complied with or satisfied by them under this Agreement; provided, however, 
that no such notification shall affect the representations, warranties,     
covenants or agreements of the parties or the conditions to the obligations 
of the parties under this Agreement.                                        

5.4. No Solicitation.                                                     

(a) The Company shall not, nor shall it permit any of its Subsidiaries
to, nor shall it authorize (and shall use its reasonable efforts not to     
permit) any officer, director or employee of, or any investment banker,     
attorney or other advisor or representative of, the Company or any of its   
Subsidiaries to, (i) solicit or initiate, or encourage, directly or         
indirectly, the submission of, any Takeover Proposal, (ii) participate in   
any discussions or negotiations regarding, or furnish to any Person any     
information or data with respect to, or take any other action to knowingly  
facilitate the making of any proposal that constitutes, or may reasonably   
be expected to lead to, any Takeover Proposal or (iii) enter into any       
agreement with respect to any Takeover Proposal or approve or resolve to    
approve any Takeover Proposal, provided that nothing contained in this      
Section 5.4 or any other provision hereof shall prohibit the Company or the 
Company's Board of Directors from (i) taking and disclosing to the          
Company's stockholders a position with respect to a tender or exchange      
offer by a third party pursuant to Rules 14d-9 and 14e-2 promulgated under  
the Exchange Act, or (ii) making such disclosure to the Company's           
stockholders as, in the good faith judgment of the Company's Board of       
Directors, after receiving advice from outside counsel, is required under   
applicable law, provided that the Company may not, except as permitted by   
Section 5.4(b) withdraw or modify, or propose to withdraw or modify, its    
position with respect to the Merger or approve or recommend, or propose to  
approve or recommend any Takeover Proposal, or enter into any agreement     
with respect to any Takeover Proposal. Upon execution of this Agreement,    
the Company will immediately cease any existing activities, discussions or  
negotiations with any parties conducted heretofore with respect to any of   
the foregoing. Notwithstanding the foregoing, prior to the Effective Time   
the Company may furnish information concerning its business, properties or  
assets to any Person or group pursuant to confidentiality agreements with   
terms and conditions similar to the Confidentiality Agreement and may       
negotiate and participate in discussions and negotiations, with such Person 
or group concerning a Takeover Proposal if:                                 

 (x) the Board of Directors of the Company determines in good faith,
after receiving advice from its financial advisor, that such Person or  
group has submitted to the Company a Takeover Proposal which is         
reasonably likely to be a Superior Proposal; and                        

 (y) the Board of Directors of the Company determines in good faith,
based upon advice of its outside legal counsel, that the failure to     
participate in such discussions or negotiations or to furnish such      
information is reasonably likely to result in a breach of such Board's  
fiduciary duties under, or otherwise violate, applicable Law.           

The Company will promptly notify Parent of the existence of any       
proposal, discussion, negotiation or inquiry received by the Company, and   
the Company will immediately communicate to Parent the terms of any         
proposal, discussion, negotiation or inquiry which it may receive (and will 
promptly provide to Parent copies of any written materials received by the  
Company in connection with such proposal, discussion, negotiation or        
inquiry) and the identity of the party making such proposal or inquiry or   
engaging in such discussion or negotiation, except to the extent that the   
Board of Directors of the Company determines in good faith, based upon      
advice of its outside legal counsel, that any such action described in this 
sentence would be reasonably likely to result in a breach of such Board's   
fiduciary duties under, or otherwise violate, applicable Law. The Company   
will promptly provide to Parent any non-public information concerning the   
Company provided to any other Person which was not previously provided to   
Parent. The Company will keep Parent fully informed of the status and       
details (including amendments or proposed amendments) to any such Takeover  
Proposal, except to the extent that the Board of Directors of the           

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Company determines in good faith, based upon advice of its outside legal    
counsel, that any such action would be reasonably likely to result in a     
breach of such Board's fiduciary duties under, or otherwise violate,        
applicable Law.                                                             

(b) Except as set forth in this Section 5.4(b), neither the Board of  
Directors of the Company nor any committee thereof shall (i) withdraw or    
modify, or propose to withdraw or modify, in a manner adverse to Parent or  
Merger Sub, the approval or recommendation by the Board of Directors of the 
Company or any such committee this Agreement or the Merger, (ii) approve or 
recommend, or propose to approve or recommend, any Takeover Proposal or     
(iii) enter into any agreement with respect to any Takeover Proposal.       
Notwithstanding the foregoing, prior to the Effective Time the Board of     
Directors of the Company may withdraw or modify its approval or             
recommendation of this Agreement or the Merger, approve or recommend a      
Superior Proposal, or enter into an agreement with respect to a Superior    
Proposal, in each case at any time after the fifth business day following   
Parent's receipt of written notice from the Company advising Parent that    
the Board of Directors of the Company has received a Superior Proposal      
which it intends to accept, specifying the material terms and conditions of 
such Superior Proposal, identifying the person making such Superior         
Proposal.                                                                   

5.5. Publicity. Except as required by Law, so long as this Agreement is in
effect, none of the Company, Parent or Merger Sub shall issue or cause the      
publication of any press release or other announcement with respect to the      
Merger, this Agreement or the other Transactions contemplated hereby without    
prior consultation with the other parties hereto.                               

5.6. Transfer Taxes. All liability for all recording fees, such as deed   
stamps and similar fees imposed on the transfer of real or personal property    
owned by the Company or any of its Subsidiaries or affiliates, whether imposed  
on the Company, any of its Subsidiaries, the stockholders of the Company,       
Merger Sub or Parent as a result of the Merger ("Transfer Taxes"), shall be     
borne by Merger Sub, and Merger Sub shall file or cause to be filed all Tax     
Returns relating to such Transfer Taxes which are due.                          

5.7. State Takeover Laws. Notwithstanding any other provision in this     
Agreement, in no event shall the Section 203 Approval be withdrawn, revoked or  
modified by the Board of Directors of the Company. If any state takeover        
statute other than Section 203 of the DGCL becomes or is deemed to become       
applicable to the Voting Agreement or the Merger, the Company shall take all    
action necessary to render such statute inapplicable to all of the foregoing.   

5.8. Indemnification and Insurance.                                       

(a) The Certificate of Incorporation and By-Laws of the Surviving     
Corporation shall contain the provisions with respect to indemnification    
and exculpation set forth in the Certificate of Incorporation and By-Laws   
of the Company, which provisions shall not be amended, repealed or          
otherwise modified in any manner that would adversely affect the rights     
thereunder of individuals who at the Effective Time were directors,         
officers, employees or agents of the Company, unless such modification is   
required by Law.                                                            

 (b) The Company shall, to the fullest extent permitted under applicable
Law or under the Company's Certificate of Incorporation or By-Laws and      
regardless of whether the Merger becomes effective, indemnify and hold      
harmless, and, after the Effective Time, Parent or the Surviving            
Corporation shall, to the fullest extent permitted under applicable Law or  
under the Surviving Corporation's Certificate of Incorporation or By-Laws,  
indemnify and hold harmless, each present and former director, officer or   
employee of the Company or any of its Subsidiaries (collectively, the       
"Indemnified Parties") against any costs or expenses (including attorneys'  
fees), judgments, fines, losses, claims, damages and liabilities incurred   
in connection with, and amounts paid in settlement of, any claim, action,   
suit, proceeding or investigation, whether civil, criminal, administrative  
or investigative and wherever asserted, brought or filed, (x) arising out   
of or pertaining to the Transactions or (y) otherwise with respect to any   
acts or omissions or alleged acts or omissions occurring at or prior to the 
Effective Time, to the same extent as provided in the respective            
Certificate of Incorporation or By-Laws of the Company or the Subsidiaries  
as                                                                          

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in effect on the date hereof. In the event of any such claim, action, suit, 
proceeding or investigation (whether arising before or after the Effective  
Time), (i) any counsel retained by the Indemnified Parties for any period   
after the Effective Time must be reasonably satisfactory to the Surviving   
Corporation, (ii) after the Effective Time, Parent or the Surviving         
Corporation shall pay the reasonable fees and expenses of such counsel,     
promptly after statements therefor are received, and (iii) Parent or the    
Surviving Corporation will cooperate in the defense of any such matter;     
provided, however, that Parent or the Surviving Corporation shall not be    
liable for any settlement effected without its written consent (which       
consent shall not be unreasonably withheld or delayed). The Indemnified     
Parties as a group may retain only one law firm to represent them with      
respect to any single action unless there is, under applicable standards of 
professional conduct, a conflict on any significant issue between the       
positions of any two or more Indemnified Parties. The indemnity agreements  
of Parent and the Surviving Corporation in this Section 5.8(b) shall        
extend, on the same terms to, and shall inure to the benefit of and shall   
be enforceable by, each person or entity who controls, or in the past       
controlled, any present or former director, officer or employee of the      
Company or any of its Subsidiaries.                                         

(c) For a period of six years after the Effective Time, Parent shall  
cause the Surviving Corporation to maintain in effect, if available,        
directors' and officers' liability insurance covering those persons who are 
currently covered by the Company's directors' and officers' liability       
insurance policy (a copy of which has been made available to Parent) on     
terms (including the amounts of coverage and the amounts of deductibles, if 
any) that are comparable to the terms now applicable to directors and       
officers of Parent, or, if more favorable to the Company's directors and    
officers, the terms now applicable to them under the Company's current      
policies; provided, however, that in no event shall Parent or the Surviving 
Corporation be required to expend in excess of 150% of the annual premium   
currently paid by the Company for such coverage; and provided, further,     
that if the premium for such coverage exceeds such amount, Parent or the    
Surviving Corporation shall purchase a policy with the greatest coverage    
available for such 150% of the annual premium. The Company has provided     
Parent with copies of all of the Company's directors' and officers'         
liability insurance policies which are currently in effect. The aggregate   
annual premium payable by the Company under such policies is $49,500.       

  (d) This Section 5.8 shall survive the consummation of the Merger at the
Effective Time, is intended to benefit the Company, the Surviving           
Corporation and the Indemnified Parties, shall be binding on all successors 
and assigns of Parent and the Surviving Corporation and shall be            
enforceable by the Indemnified Parties.                                     

5.9. Connecticut Transfer Act. The Company shall prepare and provide to   
Parent, prior to the consummation of the Merger, a Form III and an              
Environmental Conditions Assessment Form ("ECAF") as required by the            
Connecticut Transfer Act, Conn. Gen. Stat. (S)(S) 22a-134 et seq., (the         
"Connecticut Transfer Act") or such other form as may be required under the     
Connecticut Transfer Act as hereinafter provided and provide such Form III and  
ECAF or other such required form to Parent at least ten days prior to the       
consummation of the Merger. The Company shall consult with Parent and accept    
Parent's reasonable suggestions with respect to the contents of such Form III   
and ECAF or other required form. Prior to the Effective Time, the Company shall 
execute the Form III and ECAF as the certifying party and shall pay all costs   
of filing the Form III and ECAF, and after the Effective Time, the Surviving    
Corporation shall file the Form III and ECAF. If the Company and the Parent     
determine that a Form III is not the required form under the Connecticut        
Transfer Act for the Merger, the Company shall prepare and pay all costs        
associated with the required Connecticut Transfer Act filing which filing shall 
be made by the Surviving Corporation.                                           

  5.10. Financing. Between the date hereof and the consummation of the Merger,
the Company agrees to cooperate, and to cause its Representatives to cooperate, 
in connection with the efforts of Parent and Merger Sub to obtain the financing 
necessary to consummate the Transactions (the "Transaction Financing"),         
provided that the Company shall not be required to pay any fees or other costs  
with respect to the Transaction Financing prior to the consummation of the      
Merger and that any agreements which the Company may enter into prior to the    
consummation of the Merger relating to the obtaining of the Transaction         
Financing shall be conditioned upon the occurrence of the consummation of the   
Merger.                                                                         

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ARTICLE VI. 

Conditions

6.1. Conditions to Each Party's Obligation to Effect the Merger. The      
respective obligation of each party to effect and consummate the Merger shall   
be subject to the satisfaction on or prior to the Effective Time of each of the 
following conditions, any and all of which may be waived in whole or in part by 
the Company, Parent or Merger Sub, as the case may be, to the extent permitted  
by applicable Law:                                                              

  (a) this Agreement shall have been approved and adopted by the requisite
vote of the holders of Shares as required by applicable Law, the Company's  
Certificate of Incorporation and its By-Laws, in order to consummate the    
Merger;                                                                     

 (b) any waiting period applicable to the Merger under the HSR Act shall
have expired or been terminated; and                                        

  (c) no statute, rule, regulation, order, decree or injunction shall have
been enacted, promulgated or issued by any Governmental Entity precluding,  
restraining, enjoining or prohibiting consummation of the Merger.           

 6.2. Conditions to Obligations of Parent and the Merger Sub. The obligation
of each of Parent and Merger Sub to effect and consummate the Merger shall be   
subject to the satisfaction of or waiver by Parent and the Merger Sub prior to  
the Effective Time of the following additional conditions:                      

(a) the representations and warranties of the Company set forth in    
Article III which are qualified as to materiality shall be true and correct 
when made on the date hereof and shall be true and correct as of the        
Effective Time as if made as of the Effective Time, except for those        
representations and warranties which are qualified as to materiality and    
are made as of a specific date, which shall be true and correct as of such  
date; the other representations and warranties of the Company set forth in  
Article III which are not so qualified as to materiality shall be true and  
correct in all material respects when made on the date hereof and shall be  
true and correct in all material respects as of the Effective Time as if    
made as of the Effective Time, except for those representations and         
warranties which are not so qualified as to materiality and are made as of  
a specific date, which shall be true and correct in all material respects   
as of such date; provided, however, for purposes of this Section 6.2(a),    
the representations and warranties of the Company set forth in Section      
3.7(i) shall not be deemed to be untrue or incorrect in any material        
respect (i) if the financial performance of the Company with regard to the  
revenues, results of operations or other financial performance of the       
Company are materially consistent with the forecasts previously furnished   
by the Company to Parent; (ii) if the Company or its Subsidiaries lose on a 
net basis the services of less than 50 salaried employees or 50 hourly      
employees; or (iii) by reason of any matter arising out of the Company's    
relationship with Industrias Romi S.A.;                                     

(b) the Company shall have performed or complied in all material      
respects with its agreements and covenants required to be performed or      
complied with under this Agreement as of or prior to the Effective Time;    

(c) the Company shall have delivered to Parent and the Merger Sub a   
certificate of its President and Chief Financial Officer to the effect that 
each of the conditions specified in clause (a) of Section 6.1 and clauses   
(a), (b), (d), (f) and (g) of this Section 6.2 is satisfied;                

(d) (i) the Company shall have obtained all of the waivers, permits,  
consents, approvals or other authorizations of Governmental Entities        
necessary to be obtained by it to consummate the Merger, and effected all   
registrations, filings and notices with respect to Governmental Entities    
necessary to be effected by it to consummate the Merger; and (ii) at least  
ten days prior to the Closing, the Company shall have delivered to Parent a 
draft Form III and ECAF or such other required filing under the Connecticut 
Transfer Act; at the Closing, the Company shall have delivered to Parent an 
executed Form III and ECAF or such other required filing under the          
Connecticut Transfer Act for filing by the Surviving Corporation following  
the Effective Date;                                                         

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(e) the Company shall have obtained and delivered to Parent and the   
Merger Sub copies of all consents, agreements or other evidence of          
cancellation from the holders of all outstanding Options pursuant to        
Section 2.5;                                                                

(f) no action, suit or proceeding shall be pending or threatened in   
writing before any Governmental Entity which is reasonably likely to (i)    
prevent consummation of any of the Transactions contemplated by this        
Agreement, (ii) cause any of the Transactions contemplated by this          
Agreement to be rescinded following consummation or (iii) affect materially 
and adversely the right of Parent to own, operate or control any of the     
assets and operations of the Surviving Corporation following the Merger,    
and no such judgment, order, decree, stipulation or injunction shall be in  
effect; provided, however, that Parent shall contest or cooperate with the  
Company in contesting, as applicable, the action, suit or proceeding and if 
any injunction or order has been so issued, will use reasonable efforts to  
have it dismissed; in the case of any action, suit or proceeding brought by 
a Person, other than a Governmental Entity, the Company shall determine     
whether the consequences in clauses (i), (ii) or (iii) of this Section      
6.2(f) are reasonably likely to occur, which determination shall be final   
and binding on Parent and Merger Sub;                                       

(g) from the date of this Agreement to the Effective Time, there shall
not have been any event or development which results in a Material Adverse  
Effect on the Company, nor shall there have occurred any event or           
development which is reasonably likely to result in a Material Adverse      
Effect on the Company; there shall not be deemed to have been any Material  
Adverse Effect on the Company (i) if the financial performance of the       
Company with regard to revenues, results of operations or other financial   
performance of the Company are materially consistent with the forecasts     
previously furnished by the Company to Parent; (ii) if the Company or its   
Subsidiaries lose on a net basis the services of less than 50 salaried      
employees or 50 hourly employees; or (iii) by reason of any matter arising  
out of the Company's relationship with Industrias Romi S.A.;                

(h) Parent and the Merger Sub shall have received from Willkie Farr & 
Gallagher, or other counsel to the Company reasonably acceptable to Parent, 
an opinion with respect to the matters set forth in Exhibit A attached      
hereto, addressed to Parent and the Merger Sub and dated as of the Closing  
Date; and                                                                   

  (i) that certain letter agreement (the "Textron Letter Agreement") dated
the date hereof by and between Textron Inc. and Parent which confirms the   
obligations of Textron Inc. to indemnify the Surviving Corporation          
following the Merger for environmental claims under the Textron Agreements  
and contains the representations and warranties of Textron Inc. that the    
Textron Agreements are the legal, valid and binding obligations of Textron  
Inc. and will be, following the Effective Time, along with the Voting       
Agreement to which Textron Inc. is a party, enforceable against Textron     
Inc., in accordance with their terms, shall be in full force and effect as  
of the Effective Time.                                                      

  6.3. Conditions to Obligations of the Company. The obligation of the Company
to effect and consummate the Merger shall be subject to the satisfaction of or  
waiver by the Company prior to the Effective Time of the following additional   
conditions:                                                                     

 (a) the representations and warranties of Parent and the Merger Sub set
forth in Article IV which are qualified as to materiality shall be true and 
correct when made on the date hereof and shall be true and correct as of    
the Effective Time as if made as of the Effective Time, except for          
representations and warranties which are so qualified as to materiality and 
are made as of a specific date, which shall be true and correct as of such  
date; the other representations and warranties of Parent and the Merger Sub 
set forth in Article IV which are not so qualified as to materiality shall  
be true and correct in all material respects when made on the date hereof   
and shall be true and correct in all material respects as of the Effective  
Time as if made as of the Effective Time, except for those representations  
and warranties which are not so qualified as to materiality and are made as 
of a specific date, which shall be true and correct in all material         
respects as of such date;                                                   

(b) each of Parent and the Merger Sub shall have performed or complied
in all material respects with its agreements and covenants required to be   
performed or complied with under this Agreement as of or prior to the       
Effective Time;                                                             

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(c) each of Parent and the Merger Sub shall have delivered to the     
Company a certificate of its President and Chief Financial Officer to the   
effect that each of the conditions specified in clauses (a), (b), (d) and   
(e) of this Section 6.3 is satisfied in all respects;                       

 (d) Parent and the Merger Sub shall have obtained all waivers, permits,
consents, approvals or other authorizations necessary to be obtained by     
them to consummate the Merger and effected all registrations, filings and   
notices, necessary to be effected by them to consummate the Merger;         

 (e) no writ, order, decree or injunction of a Governmental Entity shall
have been entered against Parent, the Merger Sub or the Company which       
prohibits the consummation of the Merger; provided, however, that the       
Company shall have contested or cooperated with Parent or the Merger Sub,   
as applicable, in contesting, the action suit or proceeding giving rise to  
such writ, order, decree or injunction and shall have used reasonable       
efforts to have the same dismissed; and                                     

 (f) the Company shall have received from Brown, Rudnick Freed & Gesmer,
counsel to Parent and the Merger Sub, an opinion with respect to the        
matters set forth in Exhibit B attached hereto, addressed to the Company    
and dated as of the Closing Date.                                           

ARTICLE VII.

Termination 

7.1. Termination. This Agreement shall not be terminated, and the Merger  
shall not be abandoned, except in accordance with the provisions of this        
Article VII, all strictly construed against the party seeking such termination. 
This Agreement may be terminated and the Merger may be abandoned at any time    
prior to the Effective Time, whether before or after approval of this Agreement 
and the Merger by the Company's Stockholders:                                   

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

(b) by either Parent or the Company, if any Governmental Entity shall 
have issued an order (other than a temporary restraining order), decree, or 
ruling or taken any other action restraining, enjoining or otherwise        
prohibiting the Merger, and such order, decree ruling or other action shall 
have become final and nonappealable, provided that the party seeking        
termination shall have diligently contested such order, decree, ruling or   
other action;                                                               

(c) by either Parent or the Company, if this Agreement and the Merger 
fail to receive the approval of that number of stockholders of the Company  
necessary under Law to authorize and approve this Agreement and the Merger; 

(d) by either Parent or the Company, if the Board of Directors of the 
Company shall have recommended or resolved to recommend to its stockholders 
a Superior Proposal, or if the Company has approved a Superior Proposal,    
each in accordance with Section 5.4(b), and provided that the Company has   
complied with all provisions of Section 5.4, including the notice           
provisions therein, and further provided that the Company makes             
simultaneous payment of the Termination Fee; or                             

  (e) by either Parent or the Company if, without fault of and only in the
absence of any breach under this Agreement by, the party exercising the     
right of termination, the Merger shall not have been consummated on or      
before December 31, 1999.                                                   

 7.2. Termination by Parent. This Agreement may be terminated and the Merger
may be abandoned by Parent, at any time prior to the Effective Time, before or  
after the approval by the stockholders of the Company, if:                      

 (a) the Closing conditions set forth in Section 6.2 shall not have been
satisfied; provided, however, that if such failure or failures are capable  
of being cured prior to the Effective Time, such failure or                 

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failures shall not have been cured within ten (10) days of delivery to the  
Company of written notice of such failure;                                  

(b) the Company shall furnish or disclose non public information to a 
Third Party with respect to any Takeover Proposal, or shall have resolved   
to do the foregoing, or if the Board of Directors of the Company shall have 
recommended or resolved to recommend to its stockholders a Takeover         
Proposal or if the Company has approved or effected a Takeover Proposal,    
whether or not permitted under this Agreement; or                           

(c) if prior to the Effective Date, the Board of Directors of the     
Company shall have withdrawn, or modified or changed in a manner adverse to 
Parent or the Merger Sub, its approval or recommendation of this Agreement  
or the Merger.                                                              

7.3. Termination by the Company. This Agreement may be terminated and the 
Merger may be abandoned at any time prior to the Effective Time, before or      
after the approval by the Company's stockholders, by action of the Board of     
Directors of the Company, if:                                                   

  (a) Parent or the Merger Sub shall have failed to comply in any material
respect with any of the covenants or agreements contained in this Agreement 
such that the Closing condition set forth in Section 6.3(b) would not be    
satisfied or if the Closing conditions set forth in Section 6.3(c), (d),    
(e) and (f) shall not have been satisfied; provided, however, that if such  
failure or failures are capable of being cured prior to the Effective Time, 
such failure or failures shall not have been cured within ten (10) days of  
delivery to Parent of written notice of such failure; or                    

(b) there exists a breach of any one or more representations or       
warranties of Parent or the Merger Sub contained in this Agreement such     
that the Closing condition set forth in Section 6.3(a) would not be         
satisfied; provided, however, that if such failure or failures are capable  
of being cured prior to the Effective Time, such failure or failures shall  
not have been cured within ten (10) days of delivery to Parent of written   
notice of such failure.                                                     

7.4. Procedure for Termination. If either Parent or the Company wish to   
terminate this Agreement pursuant to this Article VII, written notice thereof   
shall forthwith be given to the other.                                          

7.5. Effect of Termination and Abandonment.                               

  (a) In the event of termination of this Agreement and abandonment of the
Merger pursuant to this Article VII, no party hereto (or any of its         
directors, officers or Affiliates) shall have any liability or further      
obligation to any other party to this Agreement, except as provided in      
Sections 3.22 and 4.6, the last sentence of Section 5.2, Article VII,       
Article VIII, and except to the extent that such termination results from   
the willful and material breach by a party of any of its representations,   
warranties, covenants or agreements set forth in this Agreement.            

(b) In the event of termination of this Agreement pursuant to Section 
7.1(c), or by Parent pursuant to (i) 7.2(a) as a result of a failure to     
satisfy the conditions in Sections 6.2(a) (to the extent such failure       
results from a breach by the Company of its representations and warranties  
hereunder), 6.2(b) or 6.2(d)(ii); (ii) Section 7.2(b); or (iii) Section     
7.2(c), then the Company shall, within five (5) business days thereafter,   
pay Parent by wire transfer of immediately available funds to an account    
specified by Parent an amount equal to all documented out of pocket         
reasonable fees and expenses incurred by Parent and Merger Sub since        
January 1, 1999 (including the reasonable fees and expenses of counsel,     
accountants, consultants and advisors, and any commitment fees and other    
expenses paid to prospective lenders) in connection with this Agreement and 
the Transactions contemplated hereby (the "Parent Documented Expenses");    
provided, however, the Parent Documented Expenses which the Company shall   
pay in the event of termination of this Agreement pursuant to Section       
7.1(c) shall not exceed $650,000 and the Parent Documented Expenses which   
the Company shall pay in the event of termination of this Agreement         
pursuant to Section 7.2 shall not exceed $500,000; and provided, further,   
that the Company shall not be obligated to pay any Parent                   

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Documented Expenses if (i) Parent or the Merger Sub shall have failed to    
comply in any material respect with any of the covenants or agreements      
contained in this Agreement such that the Closing condition set forth in    
Section 6.3(b) would not be satisfied; or (ii) there exists a breach of any 
one or more representations or warranties of Parent or the Merger Sub       
contained in this Agreement in any material respect such that the closing   
condition set forth in Section 6.3(a) would not be satisfied.               

(c) In the event of termination of this Agreement pursuant to Section 
7.1(d), the Company shall, within five (5) business days thereafter, pay    
Parent by wire transfer of immediately available funds to an account        
specified in writing by Parent a fee equal to the amount, if any, by which  
$3.25 million exceeds the fee payable in such event by Textron Inc. to      
Parent under the Voting Agreement to which Textron Inc. is a party (the     
"Termination Fee").                                                         

  (d) To the extent that the Termination Fee has for any reason other than
a material breach by Parent not already been paid and within twelve (12)    
months after the termination of this Agreement the Company or any of its    
Subsidiaries, or any Company Affiliate enters into a definitive agreement   
with a Third Party with respect to a Takeover Proposal or a Takeover        
Proposal is effected, then the Company shall, within five (5) business days 
after the consummation of such Takeover Proposal, pay Parent by wire        
transfer of immediately available funds to an account specified in writing  
by Parent the Termination Fee less any Parent Documented Expenses           
previously paid by the Company to Parent.                                   

ARTICLE VIII. 

Miscellaneous 

8.1. Amendment and Modification. Subject to applicable Law, this Agreement
may be amended, modified and supplemented in any and all respects, whether      
before or after any vote of the stockholders of the Company contemplated        
hereby, by written agreement of the parties hereto at any time prior to the     
Closing Date with respect to any of the terms contained herein; provided;       
however, that after the approval of this Agreement by the stockholders of the   
Company, no such amendment, modification or supplement shall reduce the amount  
or change the form of the Merger Consideration or otherwise adversely affect    
the rights of stockholders.                                                     

8.2. Nonsurvival of Representations and Warranties. Except as otherwise   
provided herein, none of the representations and warranties in this Agreement   
or in any schedule, instrument or other document delivered pursuant to this     
Agreement shall survive the Effective Time. This Section 8.2 shall not limit    
any covenant or agreement of the parties which by its terms contemplates        
performance after the Effective Time.                                           

8.3. Notices. All notices and other communications hereunder shall be in  
writing, writing and shall be deemed given upon receipt, and shall be given to  
the parties at the following addresses or telecopy numbers (or at such other    
address or telecopy number for a party as shall be specified by like notice):   

(a) if to Parent or Merger Sub, to:                                   

Goldman Industrial Group, Inc.                                        
One Post Office Square, Suite 4100                                    
Boston, Massachusetts 02109                                           
Attention: Gregory I. Goldman, Chief Executive Officer                
Telecopy: 617-338-1481                                                

with a copy to:                                                       

Brown Rudnick Freed & Gesmer                                          
One Financial Center                                                  
Boston, Massachusetts 02111                                           
Attention: Steven R. London, Esq.                                     
Telecopy: 617-856-8201                                                

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(b) if to the Company, to:                                            

Bridgeport Machines, Inc.                                             
500 Lindley Street                                                    
Bridgeport, Connecticut                                               
Attention: President                                                  
Telecopy: (203)-337-8339                                              

with a copy to:                                                       

Willkie Farr & Gallagher                                              
787 Seventh Avenue                                                    
New York, New York 10019-6099                                         
Attention: William J. Grant, Jr., Esq.                                
Telecopy: 212-728-8111                                                

8.4. Interpretation.                                                      

(a) The words "hereof," "herein" and "herewith" and words of similar  
import shall, unless otherwise stated, be construed to refer to this        
Agreement as a whole and not to any particular provision of this Agreement, 
and article, section, paragraph, exhibit and schedule references are to the 
articles, sections, paragraphs, exhibits and schedules of this Agreement    
unless otherwise specified. Whenever the words "include," "includes" or     
"including" are used in this Agreement, they shall be deemed to be followed 
by the words "without limitation." All terms defined in this Agreement      
shall have the defined meanings contained herein when used in any           
certificate or other document made or delivered pursuant hereto unless      
otherwise defined therein. The definitions contained in this Agreement are  
applicable to the singular as well as the plural forms of such terms and to 
the masculine as well as to the feminine and neuter genders of such term.   
Any agreement, instrument or statute defined or referred to herein or in    
any agreement or instrument that is referred to herein means such           
agreement, instrument or statute as from time to time mended, modified or   
supplemented, including (in the case of agreements and instruments) by      
waiver or consent and (in the case of statutes) by succession of comparable 
successor statutes and all attachments thereto and instruments incorporated 
therein. References to a Person are also to its permitted successors and    
assigns.                                                                    

(b) The phrases "the date of this Agreement," "the date hereof" and   
terms of similar import, unless the context otherwise requires, shall be    
deemed to refer to April 23, 1999. The phrase "to the knowledge of" the     
Company or any Subsidiary thereof or any similar phrase shall mean such     
facts and other information which Joseph E. Clancy, Dan L. Griffith, Walter 
C. Lazarcheck and Malcolm Taylor or any successor to the positions at the   
Company occupied by any of the foregoing after the conduct of a reasonable  
investigation by such officers. The phrase "made available" in this         
Agreement shall mean that the information referred to has been actually     
delivered to the party to whom such information is to be made available.    

8.5. Counterparts. This Agreement may be executed in two or more          
counterparts, all of which shall be considered one and the same agreement and   
shall become effective when two or more counterparts have been signed by each   
of the parties and delivered to the other parties.                              

8.6. Entire Agreement; No Third Party Beneficiaries; Rights of Ownership. 
This Agreement, the Voting Agreement and the Confidentiality Agreement          
(including the documents and the instruments referred to herein and therein):   
(a) constitute the entire agreement and supersede all prior agreements and      
understandings, both written and oral, among the parties with respect to the    
subject matter hereof, and (b) except as provided in Section 5.8 are not        
intended to confer upon any Person other than the parties hereto any rights or  
remedies hereunder.                                                             

8.7. Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction or other authority to be 
invalid, void, unenforceable or against its regulatory policy, the              

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remainder of the terms, provisions, covenants and restrictions of this          
Agreement shall remain in full force and effect and shall in no way be          
affected, impaired or invalidated unless the economic or legal substance of the 
Transactions is affected in an adverse way to any party.                        

8.8. Governing Law. This Agreement shall be governed by and construed in  
accordance with the Laws of the State of Delaware without giving effect to the  
principles of conflicts or choice of law thereof or of any other jurisdiction.  

 8.9. Assignment. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto (whether   
by operation of Law or otherwise) without the prior written consent of the      
other parties, except that Merger Sub may assign, in its sole discretion, any   
or all of its rights, interests and obligations hereunder to Parent or to any   
direct or indirect wholly owned Subsidiary of Parent. Subject to the preceding  
sentence, this Agreement will be binding upon, inure to the benefit of and be   
enforceable by the parties and their respective successors and assigns.         

8.10. Extension; Waiver. At any time prior to the Effective Time, the     
parties may (a) extend the time for the performance of any of the obligations   
or other acts of the other parties, (b) waive any inaccuracies in the           
representations and warranties of the other parties contained in this Agreement 
or in any document delivered pursuant to this Agreement or (c) subject to the   
proviso of Section 8.1, waive compliance by the other parties with any of the   
agreements or conditions contained in this Agreement. Any agreement on the part 
of a party to any such extension or waiver shall be valid only if set forth in  
an instrument in writing signed on behalf of such party. The failure of any     
party to this Agreement to assert any of its rights under this Agreement or     
otherwise shall not constitute a waiver of those rights.                        

8.11. Procedure for Termination, Amendment, Extension or Waiver. A        
termination of this Agreement pursuant to Section 7.1, an amendment of this     
Agreement pursuant to Section 8.1 or an extension or waiver pursuant to Section 
8.10 shall, in order to be effective, require in the case of Parent, Merger Sub 
or the Company, action by its Board of Directors or the duly authorized         
designee of its Board of Directors.                                             

8.12. Undertakings of Parent. Parent shall perform, or cause to be        
performed, all obligations of Merger Sub under this Agreement.                  

8.13. Definitions. For purposes of this Agreement:                        

  "Affiliate" has the meaning set forth in Rule 12b-2 of the Exchange Act.

"Benefit Plans" has the meaning assigned thereto in Section 3.10.     

"By-laws" has the meaning assigned thereto in Section 1.5.            

"Certificate of Incorporation" has the meaning assigned thereto in    
Section 1.5.                                                                

  "Certificate of Merger" has the meaning assigned thereto in Section 1.6.

"Certificates" has the meaning assigned thereto in Section 2.2.       

"Closing" has the meaning assigned thereto in Section 1.3.            

"Closing Date" has the meaning assigned thereto in Section 1.3.       

"Code" means the Internal Revenue Code of 1986, as amended.           

"Company" means Bridgeport Machines, Inc. a Delaware corporation.     

 "Company Confidentiality Agreement" has the meaning assigned thereto in
Section 5.2.                                                                

  "Company Material Contracts" has the meaning assigned thereto in Section
3.16(a).                                                                    

 "Computer Systems" has the meaning assigned thereto in Section 3.25(a).

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"Connecticut Transfer Act" has the meaning assigned thereto in Section
5.9.                                                                        

"Defect" means a defect or impurity of any kind, whether in design,   
manufacture, processing, or otherwise, including, without limitation, any   
dangerous propensity associated with any reasonably foreseeable use of a    
Product, or the failure to warn of the existence of any defect, impurity,   
or dangerous propensity.                                                    

"DGCL" means the Delaware General Corporation Law, as amended.        

"Dissenting Stockholders" has the meaning assigned thereto in Section 
2.l(c).                                                                     

"ECAF" has the meaning assigned thereto in Section 5.9.               

"Effective Time" has the meaning assigned thereto in Section 1.2.     

"ERISA" means the Employee Retirement Income Security Act of 1974, as 
amended, and the rules and regulations promulgated thereunder.              

"Environmental Agreements" has the meaning assigned thereto in Section
3.13(i).                                                                    

"Environmental Laws" means all foreign, Federal, state and local Laws 
relating to pollution or protection of human health, safety or the          
environment, including, without limitation, Laws relating to Releases or    
threatened Releases of Hazardous Materials into the outdoor environment     
(including, without limitation, ambient air, surface water, groundwater,    
land, surface and subsurface strata) or otherwise relating to the           
manufacture, processing, distribution, use, treatment, storage, Release,    
transport or handling of Hazardous Materials, and all Laws and regulations  
with regard to recordkeeping, notification, disclosure and reporting        
requirements respecting Hazardous Materials.                                

"ERISA Affiliate" has the meaning assigned thereto in Section 3.10.   

"Exchange Act" means the Securities Exchange Act of 1934, as amended. 

"Fee Properties" has the meaning assigned thereto in Section 3.15.    

"Governmental Entity" means any (i) nation, state, county, city, town,
village, district, or other jurisdiction of any nature; (ii) federal,       
state, local, municipal, foreign or other government; (iii) governmental or 
quasi-governmental authority of any nature (including any governmental      
agency, branch, department, official, or entity and any court or other      
tribunal); or (iv) body exercising, or entitled to exercise any             
administrative, executive, judicial, legislative, police, regulatory, or    
taxing authority or power of any nature.                                    

"Hazardous Materials" means all substances defined as hazardous       
substances in the National Oil and Hazardous Substances Pollution           
Contingency Plan, 40 C.F.R. (S) 300.5, or substances defined as hazardous   
substances, hazardous materials, toxic substances, hazardous wastes,        
pollutants or contaminants, under any Environmental Law, or substances      
regulated under any Environmental Law, including, but not limited to,       
petroleum (including crude oil or any fraction thereof), asbestos, and      
polychlorinated biphenyls.                                                  

"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements Act of   
1976, as amended.                                                           

"Indemnified Parties" has the meaning assigned thereto in Section     
5.8(b).                                                                     

"Intellectual Property Rights" has the meaning assigned thereto in    
Section 3.14(a).                                                            

"Laws" means any administrative order, constitution, law, ordinance,  
principle of common law, rule, regulation, statute, treaty, judgment,       
decree, license or permit enacted, promulgated, issued, enforced or entered 
by any Governmental Entity.                                                 

"Leased Properties" has the meaning assigned thereto in Section 3.15. 

  "Lien" means any conditional sale agreement, default of title, easement,
encroachment, encumbrance, hypothecation, infringement, lien, mortgage,     
pledge, reservation, restriction, security                                  

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interest, title retention or other security arrangement, or any adverse     
right or interest, charge or claim of any nature whatsoever of, on, or with 
respect to any asset, property or property interest.                        

 "Material Adverse Change" or "Material Adverse Effect" means, when used
in connection with the Company or Parent, any change or effect (or any      
development that, insofar as can reasonably be foreseen, is likely to       
result in any change or effect) that is materially adverse to the business, 
properties, assets, prospects, financial condition or results of operations 
of such party and its Subsidiaries taken as a whole.                        

"Merger" has the meaning assigned thereto in Section 1.5.             

 "Merger Consideration" has the meaning assigned thereto in Section 2.1.

"Merger Sub" means Bronze Acquisition Corp., a Delaware corporation.  

"Option Plans" has the meaning assigned thereto in Section 2.5(b).    

"Option" has the meaning assigned thereto in Section 2.5.             

"Parent" means Goldman Industrial Group, Inc., a Delaware corporation.

"Parent Confidentiality Agreement" has the meaning assigned thereto in
Section 5.2.                                                                

  "Parent Documented Expenses" has the meaning assigned thereto in Section
7.5(b).                                                                     

"Paying Agent" has the meaning assigned thereto in Section 2.2(a).    

"Permit" means any Federal, state, local and foreign governmental     
approval, authorization, certificate, filing, franchise, license, notice,   
permit or right.                                                            

"Permitted Liens" means (i) Liens for Taxes which are not yet due or  
delinquent or which are being contested in good faith, (ii) carriers',      
warehousemen's, mechanics', materialmen's or other like Liens arising in    
the ordinary course of business and securing obligations that are not due   
or which are being contested in good faith, (iii) zoning restrictions,      
easements, rights-of-way, restrictions on use of real property and other    
similar encumbrances incurred in the ordinary course of business and (iv)   
Liens or other imperfections of title which, individually or in the         
aggregate, do not materially detract from the value of the property subject 
thereto or materially interfere with the ordinary conduct of the business   
of the Company and its Subsidiaries, taken as a whole.                      

"Person" means an individual, corporation, partnership, joint venture,
association, joint stock company, limited liability company, labor union,   
estate, trust, unincorporated organization or other entity, including any   
Governmental Entity.                                                        

"Product" means any product designed, manufactured, shipped, sold,    
marketed, distributed and/or otherwise introduced into the stream of        
commerce by or on behalf of the Company or any of its Subsidiaries,         
including, without limitation, any product sold in the United States by the 
Company or any of its Subsidiaries as the distributor, agent, or pursuant   
to any other contractual relationship with a non-U.S. manufacturer.         

"Proxy Statement" has the meaning assigned thereto in Section 1.4.    

"Real Property" has the meaning assigned thereto in Section 3.15.     

"Release" means any release, spill, emission, discharge, leaking,     
pumping, injection, deposit, disposal, discharge, dispersal, leaching or    
migration into the environment (including, without limitation, ambient air, 
surface water, groundwater, and surface or subsurface strata) or into or    
out of any property, including the movement of Hazardous Materials through  
or in the air, soil, surface water, ground, water or property.              

"Representative" means, with respect to any Person, such Person's     
officers, directors, employees, agents and representatives (including any   
investment banker, financial advisor, accountant, legal counsel, agent,     
representative or expert retained by or acting on behalf of such Person or  
its Subsidiaries).                                                          

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 "SEC" means the United States Securities and Exchange Commission or any
successor agency.                                                           

"SEC Documents" has the meaning assigned thereto in Section 3.5.      

"Secretary of State" means the Secretary of State of the State of     
Delaware.                                                                   

 "Section 203 Approval" has the meaning assigned thereto in Section 3.4.

"Securities Act" means the Securities Act of 1933, as amended.        

"Shares" has the meaning assigned thereto in the recitals.            

  "Significant Subsidiaries" has the meaning assigned thereto in Rule 1-02
of Regulation S-X of the SEC.                                               

"Special Meeting" has the meaning assigned thereto in Section 1.4.    

"Subsidiary" means, with respect to any Person, any corporation,      
partnership, joint venture or other entity, whether incorporated or         
unincorporated, of which such Person or any other Subsidiary of such Person 
(i) owns, directly or indirectly, 50% or more of the outstanding voting     
securities or equity interests, (ii) is entitled to elect at least a        
majority of the Board of Directors or similar governing body, or (iii) is a 
general partner (excluding such partnerships where such Person or any       
Subsidiary of such Person do not have a majority of the voting interests in 
such partnership).                                                          

"Superior Proposal" means an unsolicited bona fide proposal by a Third
Party to acquire, directly or indirectly, for consideration consisting of   
cash and/or securities, more than a majority of the Shares then outstanding 
or all or substantially all of the assets off the Company, and otherwise on 
terms which the Board of Directors of the Company determines in good faith  
to be more favorable to the Company's stockholders by more than one hundred 
ten percent (110%) than the Merger, based on advice of the Company's        
independent financial advisor, for which financing, to the extent required, 
is then committed or which, in the good faith reasonable judgment of the    
Board of Directors of the Company, based on advice from the Company's       
independent financial advisor, is reasonably capable of being financed by   
such Third Party and which, in the good faith reasonable judgment of the    
Board of Directors of the Company, is reasonably capable of being           
consummated within a period of time not materially longer in duration than  
the period of time reasonably believed to be necessary to consummate the    
Merger.                                                                     

"Surviving Corporation" means Bridgeport Machines, Inc. after the     
Merger.                                                                     

"Takeover Proposal" means any bona fide proposal or offer, whether in 
writing or otherwise, from any Person other than Parent, Merger Sub or any  
affiliates thereof (a "Third Party") to acquire beneficial ownership (as    
defined under Rule 13(d) of the Exchange Act) of all or a material portion  
of the assets of the Company and its Subsidiaries, taken as whole, or 50%   
or more of any class of equity securities of the Company pursuant to a      
merger, consolidation or other business combination, sale of shares of      
capital stock, sale of assets, tender offer, exchange offer or similar      
transaction with respect to the Company, including any single or multi-step 
transaction or series of related transactions, which is structured to       
permit such Third Party to acquire beneficial ownership of any material     
portion of the assets of the Company and its Subsidiaries, taken as a       
whole, or 50% or more of the equity interest in the Company.                

"Taxes" mean any Federal, state, local or foreign net income, gross   
income, receipts, windfall profit, severance, property, production, sales,  
use, license, excise, franchise, employment, payroll, withholding,          
alternative or add-on minimum, ad valorem, transfer, stamp or environmental 
tax, or any other tax, custom, duty, governmental fee or other like         
assessment or charge of any kind whatsoever, together with any interest or  
penalty, addition to tax or additional amount imposed by any Governmental   
Entity.                                                                     

"Tax Returns" mean all returns, reports, or statements required to be 
filed with any Governmental Entity with respect to any Tax (including any   
attachments thereto), including, without limitation, any consolidated,      
unitary or similar return, information return, claim for refund, amended    
return or declaration of estimated Tax.                                     

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"Termination Fee" has the meaning assigned thereto in Section 7.5(c). 

"Textron Agreements" has the meaning assigned thereto in Section      
3.13(i).                                                                    

"Textron Letter Agreement" has the meaning assigned thereto in Section
6.2(i).                                                                     

"Third Party" has the meaning assigned thereto in this Section 8.13.  

"Transactions" mean this Agreement and the transactions contemplated  
hereby, including the Merger.                                               

"Transaction Financing" has the meaning assigned thereto in Section   
5.10.                                                                       

"Transfer Taxes" has the meaning assigned thereto in Section 5.6.     

"Year 2000 Compliant" has the meaning assigned thereto in Section     
3.25(c).                                                                    

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IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this   
Agreement to be signed by their respective officers thereunto duly authorized   
as of the date first written above.                                             

                                  GOLDMAN INDUSTRIAL GROUP, INC.

                             By:/s/ Gregory I. Goldman
                                         -------------------------------------
                            Name: Gregory I. Goldman
                                        Title: President and Chief Executive
             Officer

                            BRONZE ACQUISITION CORP.

                              By: /s/ Gregory I. Goldman
                                         -------------------------------------
                            Name: Gregory I. Goldman
                                        Title: President and Chief Executive
             Officer

                             BRIDGEPORT MACHINES, INC.

                           By: /s/ Dan L. Griffith
                                         -------------------------------------
                         Name: Dan L. Griffith
                                        Title: President and Chief Executive
             Officer

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APPENDIX B

Affiliate's Agreement 

  This AGREEMENT (this "Agreement") is made as of April 23, 1999, by and among
Goldman Industrial Group, Inc., a Delaware corporation (the "Parent"), and      
Textron Inc., a Delaware corporation ("Textron"), a shareholder of Bridgeport   
Machines, Inc., a Delaware corporation (the "Company"). Reference is made to    
that certain Agreement and Plan of Merger, dated April 23, 1999 (the "Merger    
Agreement"), by and among Parent, Bronze Acquisition Corp., a Delaware          
corporation and wholly owned subsidiary of Parent (the "Purchaser"), and the    
Company.                                                                        

  WHEREAS, pursuant to the Merger Agreement, Parent, Purchaser and the Company
are contemplating a merger of Purchaser with and into the Company (the          
"Merger"), pursuant to which the Company will become a wholly-owned subsidiary  
of Parent;                                                                      

WHEREAS, the Merger is contingent upon the approval of the Merger and the 
Merger Agreement by the Company's stockholders at a special meeting of the      
Company's stockholders, and Textron desires to facilitate the Merger by         
agreeing to vote Textron's shares of the Company's Common Stock, $.01 per value 
(the "Common Stock") and any shares of Common Stock of the Company over which   
Textron has voting control in favor of the Merger and the Merger Agreement;     

WHEREAS, Textron desires irrevocably to appoint Parent or any designee of 
Parent as Textron's lawful agent, attorney and proxy to vote in favor of the    
Merger and the Merger Agreement;                                                

WHEREAS, in accordance with the Merger Agreement, shares of Common Stock  
owned by Textron at the Effective Time (as defined in the Merger Agreement)     
shall be converted into the right to receive cash in accordance with the Merger 
Agreement; and                                                                  

WHEREAS, Textron has agreed to provide certain other inducements to Parent
and Purchaser to induce them to enter into the Merger Agreement;                

NOW, THEREFORE, in consideration of the mutual agreements, provisions and 
covenants set forth in the Merger Agreement and hereinafter in this Agreement,  
and for other good and valuable consideration, the receipt and sufficiency of   
which is hereby acknowledged, Textron agrees as follows:                        

1. Transfer Restriction. Textron will not sell, transfer or otherwise     
dispose of, or reduce his or its interest in any shares of Common Stock         
currently owned or hereafter acquired by it prior to the termination of this    
Agreement.                                                                      

2. Irrevocable Proxy. Textron hereby irrevocably appoints Parent or any   
designee of Parent as Textron's lawful agent, attorney and proxy to vote or     
give consents with respect to all shares of Common Stock held by Textron and    
all shares of Common Stock over which Textron has voting control, in favor of   
the approval of the Merger and the Merger Agreement and any matters incidental  
thereto. Textron intends this proxy to be irrevocable and coupled with an       
interest. Parent agrees that it or its designee shall vote the shares of Common 
Stock held by Textron and the shares of Common Stock over which Textron has     
voting control in favor of the approval of the Merger and the Merger Agreement. 
The agents, attorneys and proxies named herein may not exercise this proxy on   
any other matter except as provided herein. Textron may vote all shares of      
Common Stock held by Textron and all shares of Common Stock over which Textron  
has voting control on all other matters.                                        

3. Voting Agreement. If the Parent cannot or does not for any reason vote 
the proxy granted to the Parent in Section 2, above, at a special meeting of    
the stockholders of the Company called for the purpose of considering the       
approval of the Merger and the Merger Agreement, Textron agrees to vote all of  
the shares of Common Stock held by Textron and all shares of Common Stock over  
which Textron has voting control in favor of the Merger and the Merger          
Agreement.                                                                      

4. No Shopping. Textron shall not directly or indirectly (i) solicit,     
initiate or encourage (or authorize any person to solicit, initiate or          
encourage) any inquiry, proposal or offer from any person (other than Parent)   
to                                                                              

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acquire the business, property or capital stock of the Company or any direct or 
indirect subsidiary thereof, or any acquisition of a substantial equity         
interest in, or a substantial amount of the assets of, the Company or any       
direct or indirect subsidiary thereof, whether by merger, purchase of assets,   
tender offer or other transaction or (ii) participate in any discussion or      
negotiations regarding, or furnish to any other person any information with     
respect to, or otherwise cooperate in any way with, or participate in,          
facilitate or encourage any effort or attempt by any person (other than Parent) 
to do or seek any of the foregoing. Notwithstanding any provision in this       
Section 4 to the contrary, Textron's representative on the Company's Board of   
Directs may take actions in such capacity permitted under the Merger Agreement. 

5. Transfer of Profits. In the event the Company is obligated to pay a    
Termination Fee (as defined in the Merger Agreement) pursuant to Section 7.5(c) 
or 7.5(d) of the Merger Agreement, Textron shall, within five (5) business days 
after the consummation of the transaction which triggers such obligation (a     
"Triggering Transaction"), pay Parent by wire transfer of immediately-available 
funds to an account specified in writing by Parent, the amount (hereinafter,    
the "Textron Takeover Fee") which equals the product of (a) the amount by which 
the consideration paid to Textron pursuant to such Triggering Transaction       
exceeds $10 per share of Common Stock and (b) the total number of shares of     
Common Stock transferred by Textron pursuant to such Triggering Transaction.    
The $10 per share shall be adjusted for any recapitalization,                   
reclassifications, stock split or similar event.                                

6. Miscellaneous.                                                         

(a) By signing below, Textron represents and warrants that Textron has
all necessary power and authority to execute this Agreement and to cause    
Textron's shares of Common Stock and the shares of Common Stock over which  
Textron has voting control, to be voted as provided herein, and Textron has 
duly authorized, executed and delivered this Agreement.                     

  (b) This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware without giving effect to the principles   
of conflict of laws thereof.                                                

  (c) This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any  
and all of the parties hereto may execute this Agreement by signing any     
such counterpart.                                                           

 (d) This Agreement shall terminate upon the earlier to occur of (i) the
Effective Date or (ii) termination of the Merger Agreement in accordance    
with the terms thereof except that the provisions of Section 5 hereof shall 
continue for as long as Parent has the right to receive any payment of the  
Textron Takeover Fee.                                                       

  (e) This Agreement shall be binding on Textron's successors and assigns.

(f) Textron has carefully read this agreement and discussed its       
requirements, to the extent Textron believes necessary, with its counsel or 
counsel for the Company.                                                    

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

                                  GOLDMAN INDUSTRIAL GROUP, INC.

                                 By:       /s/ Gregory Goldman
                                            ----------------------------------
                                           Gregory Goldman
                                           Chief Executive Officer

                TEXTRON INC.

                                By:       /s/ Stephen L. Key
                                            ----------------------------------
                                            Stephen L. Key
                                            Executive Vice President and
                                           Chief Financial Officer

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APPENDIX C

Form of Affiliate's Agreement For Principal Stockholders Other Than Textron 
Inc.

  This AGREEMENT (this "Agreement") is made as of April 23, 1999, by and among
Goldman Industrial Group, Inc., a Delaware corporation (the "Parent"), and the  
undersigned stockholder (the "Undersigned") of Bronze, Inc., a Delaware         
corporation (the "Company"). Reference is made to that certain Agreement and    
Plan of Merger, dated April 23, 1999 (the "Merger Agreement"), by and among     
Parent, Bronze Acquisition Corp., a Delaware corporation and wholly owned       
subsidiary of Parent (the "Purchaser"), and the Company.                        

  WHEREAS, pursuant to the Merger Agreement, Parent, Purchaser and the Company
are contemplating a merger of Purchaser with and into the Company (the          
"Merger"), pursuant to which the Company will become a wholly owned subsidiary  
of Parent;                                                                      

WHEREAS, the Merger is contingent upon the approval of the Merger and the 
Merger Agreement by the Company's stockholders at a special meeting of the      
Company's stockholders, and the Undersigned desires to facilitate the Merger by 
agreeing to vote the Undersigned's shares of the Company's Common Stock, $.01   
par value (the "Common Stock") and any shares of Common Stock of the Company    
over which the Undersigned has voting control in favor of the Merger and the    
Merger Agreement;                                                               

WHEREAS, the Undersigned desires irrevocably to appoint Parent or any     
designee of Parent as the Undersigned's lawful agent, attorney and proxy to     
vote in favor of the Merger and the Merger Agreement; and                       

WHEREAS, in accordance with the Merger Agreement, shares of Common Stock  
owned by the Undersigned at the Effective Time (as defined in the Merger        
Agreement) shall be converted into the right to receive cash in accordance with 
the Merger Agreement.                                                           

NOW, THEREFORE, in consideration of the mutual agreements, provisions and 
covenants set forth in the Merger Agreement and hereinafter in this Agreement,  
and for other good and valuable consideration, the receipt and sufficiency of   
which is hereby acknowledged, the Undersigned agrees as follows:                

1. Transfer Restriction. The Undersigned will not sell, transfer or       
otherwise dispose of, or reduce his or its interest in any shares of Common     
Stock currently owned or hereafter acquired by him or it prior to the           
termination of this Agreement.                                                  

 2. Irrevocable Proxy. The Undersigned hereby irrevocably appoints Parent or
any designee of Parent as the Undersigned's lawful agent, attorney and proxy to 
vote or give consents with respect to all shares of Common Stock held by the    
Undersigned and all shares of Common Stock over which the Undersigned has       
voting control, in favor of the approval of the Merger and the Merger Agreement 
and any matters incidental thereto. The Undersigned intends this proxy to be    
irrevocable and coupled with an interest. Parent agrees that it or its designee 
shall vote the shares of Common Stock held by the Undersigned and the shares of 
Common Stock over which the Undersigned has voting control in favor of the      
approval of the Merger and the Merger Agreement. The agents, attorneys and      
proxies named herein may not exercise this proxy on any other matter except as  
provided herein. The Undersigned may vote all shares of Common Stock held by    
the Undersigned and all shares of Common Stock over which the Undersigned has   
voting control on all other matters.                                            

3. Voting Agreement. If the Parent cannot or does not for any reason vote 
the proxy granted to the Parent in Section 2, above, at a special meeting of    
the stockholders of the Company called for the purpose of considering the       
approval of the Merger and the Merger Agreement, the Undersigned agrees to vote 
all of the shares of Common Stock held by the Undersigned and all shares of     
Common Stock over which the Undersigned has voting control in favor of the      
Merger and the Merger Agreement.                                                

4. No Shopping. The Undersigned, in its capacity as a stockholder of the  
Company, shall not directly or indirectly (i) solicit, initiate or encourage    
(or authorize any person to solicit, initiate or encourage) any inquiry,        
proposal or offer from any person (other than Parent) to acquire the business,  
property or capital stock of the Company or any direct or indirect subsidiary   
thereof, or any acquisition of a substantial equity interest in, or a           

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substantial amount of the assets of, the Company or any direct or indirect      
subsidiary thereof, whether by merger, purchase of assets, tender offer or      
other transaction or (ii) participate in any discussion or negotiations         
regarding, or furnish to any other person any information with respect to, or   
otherwise cooperate in any way with, or participate in, facilitate or encourage 
any effort or attempt by any person (other than Parent) to do or seek any of    
the foregoing. Notwithstanding any provision of this Section 4 to the contrary, 
the Undersigned's representative on the Company's Board of Directors may take   
actions in such capacity permitted under the Merger Agreement.                  

5. Miscellaneous.                                                         

(a) By signing below, the Undersigned represents and warrants that the
Undersigned has all necessary power and authority to execute this Agreement 
and to cause the Undersigned's shares of Common Stock and the shares of     
Common Stock over which the Undersigned has voting control, to be voted as  
provided herein, and the Undersigned has duly authorized, executed and      
delivered this Agreement.                                                   

  (b) This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware without giving effect to the principles   
of conflict of laws thereof.                                                

  (c) This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any  
and all of the parties hereto may execute this Agreement by signing any     
such counterpart.                                                           

 (d) This Agreement shall terminate upon the earlier to occur of (i) the
Effective Date or (ii) termination of the Merger Agreement in accordance    
with the terms thereof.                                                     

 (e) This Agreement shall be binding on the Undersigned's successors and
assigns, including his heirs, executors and administrators.                 

 (f) The undersigned has carefully read this agreement and discussed its
requirements, to the extent the Undersigned believed necessary, with its    
counsel or counsel for the Company.                                         

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

                                  GOLDMAN INDUSTRIAL GROUP, INC.

       By:
                                            ----------------------------------
                                  Name: Gregory I. Goldman
                                       Title:Chief Executive Officer

                STOCKHOLDER:

       By:
                                            ----------------------------------
               Name:
                Title:

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APPENDIX D

[LETTERHEAD OF TEXTRON INC.]

                                                                  April 23, 1999

Goldman Industrial Group, Inc.                                                  
One Post Office Square, Suite 4100                                              
Boston, Massachusetts 02109                                                     

Gentlemen:                                                                      

 Reference is made to that certain Agreement and Plan of Merger, dated as of
April 23, 1999, by and among Goldman Industrial Group, Inc. ("Goldman"), Bronze 
Acquisition Corp., and Bridgeport Machines, Inc. (the "Company"). Capitalized   
terms used herein without definition shall have the meanings ascribed to them   
in the Merger Agreement.                                                        

We further make reference to the Purchase and Sale Agreement, dated as of 
May 7, 1986 between the Company and Textron Inc. ("Textron") and the Settlement 
Agreement, dated as of June 23, 1994, between the Company and Textron (such     
agreements, collectively, the "Textron Agreements").                            

Textron is the holder of shares of the Common Stock of the Company, and in
connection with the Merger, Textron will receive from Goldman (or Bronze        
Acquisition Corp.) $10.00 for each share of such Common Stock.                  

 In connection with the Merger and in consideration of the Merger Agreement,
Textron hereby confirms and ratifies that, subject to compliance by the Company 
(or any successor thereto) of its obligations under the Textron Agreements,     
Textron's obligations under the Textron Agreements will continue, and, subject  
to completion of the Merger, the Company's rights under the Textron Agreements  
may be assigned to any successor to the Company. Textron further represents and 
warrants to Goldman that the Textron Agreements are legal, valid and binding    
obligations of Textron, and are and will be, following the Effective Time,      
enforceable against Textron in accordance with their terms.                     

                     Very truly yours,

                TEXTRON INC.

                                 By:        /s/ Stephen L. Key
                                            ----------------------------------
                                            Stephen L. Key
                                            Executive Vice President and
                                           Chief Financial Officer

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APPENDIX E

                                                              April 23, 1999

Board of Directors of Bridgeport Machines, Inc.                                 
c/o Bridgeport Machines, Inc.                                                   
500 Lindley Street                                                              
Bridgeport, CT 06606                                                            

Members of the Board:                                                           

We understand that Bridgeport Machines, Inc. ("Bridgeport Machines" or the
"Company") and the Goldman Industrial Group, Inc. ("Goldman Industrial") are    
proposing to enter into an agreement pursuant to which the Company will merge   
with and into Goldman Industrial and, upon the effectiveness of such merger,    
each outstanding share of common stock of the Company will be converted into    
the right to receive $10.00 in cash (the "Proposed Transaction"). The terms and 
conditions of the Proposed Transaction are set forth in more detail in the      
Agreement and Plan of Merger dated April 23, 1999 between the Company and       
Goldman Industrial (the "Agreement").                                           

We have been requested by the Board of Directors of the Company to render 
our opinion with respect to the fairness, from a financial point of view, to    
the Company's stockholders of the consideration to be offered to such           
stockholders in the Proposed Transaction. We have not been requested to opine   
as to, and our opinion does not in any manner address, the Company's underlying 
business decision to proceed with or effect the Proposed Transaction.           

 In arriving at our opinion, we reviewed and analyzed: (1) the Agreement and
the specific terms of the Proposed Transaction, (2) publicly available          
information concerning the Company that we believe to be relevant to our        
analysis, (3) financial and operating information with respect to the business, 
operations and prospects of the Company furnished to us by the Company, (4) a   
trading history of the Company's common stock from January 1, 1996 to the       
present and a comparison of that trading history with those of other companies  
that we deemed relevant, (5) a comparison of the historical financial results   
and present financial condition of the Company with those of other companies    
that we deemed relevant, and (6) a comparison of the financial terms of the     
Proposed Transaction with the financial terms of certain other recent           
transactions that we deemed relevant. In addition, we have had discussions with 
the management of the Company concerning its business, operations, assets,      
financial condition and prospects and have undertaken such other studies,       
analyses and investigations as we deemed appropriate.                           

  In arriving at our opinion, we have assumed and relied upon the accuracy and
completeness of the financial and other information used by us without assuming 
any responsibility for independent verification of such information and have    
further relied upon the assurances of management of the Company that they are   
not aware of any facts or circumstances that would make such information        
inaccurate or misleading. With respect to the financial projections of the      
Company, upon advice of the Company we have assumed that such projections have  
been reasonably prepared on a basis reflecting the best currently available     
estimates and judgments of the management of the Company as to the future       
financial performance of the Company and that the Company will perform in       
accordance with such projections. In arriving at our opinion, we have conducted 
only a limited physical inspection of the properties and facilities of the      
Company and have not made or obtained any evaluations or appraisals of the      
assets or liabilities of the Company. In addition, you have not authorized us   
to solicit, and we have not solicited, any indications of interest from any     
third party with respect to the purchase of all or a part of the Company's      
business. Our opinion necessarily is based upon market, economic and other      
conditions as they exist on, and can be evaluated as of, the date of this       
letter.                                                                         
LEHMAN BROTHERS 
3 WORLD FINANCIAL CENTER, NEW YORK, NY 10285 TELEPHONE (212) 526-7000 FACSIMILE 
(212)526-3738 

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April 23, 1999                                                                  
Page Two                                                                        

Based upon and subject to the foregoing, we are of the opinion as of the  
date hereof that, from a financial point of view, the consideration to be       
offered to the stockholders of the Company in the Proposed Transaction is fair  
to such stockholders.                                                           

We have acted as financial advisor to the Company in connection with the  
Proposed Transaction and will receive a fee for our services which is           
contingent upon the consummation of the Proposed Transaction. In addition, the  
Company has agreed to indemnify us for certain liabilities that may arise out   
of the rendering of this opinion. We also have performed various investment     
banking services for the Company in the past and have received customary fees   
for such services. Mr. Eliot Fried, a Managing Director of Lehman Brothers      
Inc., is a director of the Company. In addition, affiliates of Lehman Brothers  
Inc. own approximately 639,935 shares of the Company's common stock.            

This opinion is for the use and benefit of the Board of Directors of the  
Company and is rendered to the Board of Directors in connection with its        
consideration of the Proposed Transaction. This opinion is not intended to be   
and does not constitute a recommendation to any stockholder of the Company as   
to whether to accept the consideration to be offered to such stockholder in     
connection with the Proposed Transaction.                                       

                     Very truly yours,

                                         /s/ LEHMAN BROTHERS
                                         -------------------------------------

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APPENDIX F

SECTION 262 OF THE DELAWARE GENERAL CORPORATION LAW 

 262 APPRAISAL RIGHTS. -- (a) Any stockholder of a corporation of this State
who holds shares of stock on the date of the making of a demand pursuant to     
subsection (d) of this section with respect to such shares, who continuously    
holds such shares through the effective date of the merger or consolidation,    
who has otherwise complied with subsection (d) of this section and who has      
neither voted in favor of the merger or consolidation nor consented thereto in  
writing pursuant to (S)228 of this title shall be entitled to an appraisal by   
the Court of Chancery of the fair value of the stockholder's shares of stock    
under the circumstances described in subsections (b) and (c) of this section.   
As used in this section, the word "stockholder" means a holder of record of     
stock in a stock corporation and also a member of record of a nonstock          
corporation; the words "stock" and "share" mean and include what is ordinarily  
meant by those words and also membership or membership interest of a member of  
a nonstock corporation; and the words "depository receipt" mean a receipt or    
other instrument issued by a depository representing an interest in one or more 
shares, or fractions thereof, solely of stock of a corporation, which stock is  
deposited with the depository.                                                  

(b) Appraisal rights shall be available for the shares of any class or    
series of stock of a constituent corporation in a merger or consolidation to be 
effected pursuant to (S)251 (other than a merger effected pursuant to (S)251    
(g) of this title), (S)252, (S)254, (S)257, (S)258, (S)263 or (S)264 of this    
title:                                                                          

  (1) Provided, however, that no appraisal rights under this section shall
be available for the shares of any class or series of stock, which stock,   
or depository receipts in respect thereof, at the record date fixed to      
determine the stockholders entitled to receive notice of and to vote at the 
meeting of stockholders to act upon the agreement of merger or              
consolidation, were either (i) listed on a national securities exchange or  
designated as a national market system security on an interdealer quotation 
system by the National Association of Securities Dealers, Inc. or (ii) held 
of record by more than 2,000 holders; and further provided that no          
appraisal rights shall be available for any shares of stock of the          
constituent corporation surviving a merger if the merger did not require    
for its approval the vote of the stockholders of the surviving corporation  
as provided in subsection (f) of (S)251 of this title.                      

(2) Notwithstanding paragraph (1) of this subsection, appraisal rights
under this section shall be available for the shares of any class or series 
of stock of a constituent corporation if the holders thereof are required   
by the terms of an agreement of merger or consolidation pursuant to         
(S)(S)251, 252, 254, 257, 258, 263 and 264 of this title to accept for such 
stock anything except:                                                      

a. Shares of stock of the corporation surviving or resulting from 
such merger or consolidation, or depository receipts in respect         
thereof;                                                                

 b. Shares of stock of any other corporation, or depository receipts
in respect thereof, which shares of stock (or depository receipts in    
respect thereof) or depository receipts at the effective date of the    
merger or consolidation will be either listed on a national securities  
exchange or designated as a national market system security on an       
interdealer quotation system by the National Association of Securities  
Dealers, Inc. or held of record by more than 2,000 holders.             

c. Cash in lieu of fractional shares or fractional depository     
receipts described in the foregoing subparagraphs a. and b. of this     
paragraph; or                                                           

d. Any combination of the shares of stock, depository receipts and
cash in lieu of fractional shares or fractional depository receipts     
described in the foregoing subparagraphs a., b. and c. of this          
paragraph.                                                              

(3) In the event all of the stock of a subsidiary Delaware corporation
party to a merger effected under (S)253 of this title is not owned by the   
parent corporation immediately prior to the merger, appraisal rights shall  
be available for the shares of the subsidiary Delaware corporation.         

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(c) Any corporation may provide in its certificate of incorporation that  
appraisal rights under this section shall be available for the shares of any    
class or series of its stock as a result of an amendment to its certificate of  
incorporation, any merger or consolidation in which the corporation is a        
constituent corporation or the sale of all or substantially all of the assets   
of the corporation. If the certificate of incorporation contains such a         
provision, the procedures of this section, including those set forth in         
subsections (d) and (e) of this section, shall apply as nearly as is            
practicable.                                                                    

(d) Appraisal rights shall be perfected as follows:                       

  (1) If a proposed merger or consolidation for which appraisal rights are
provided under this section is to be submitted for approval at a meeting of 
stockholders, the corporation, not less than 20 days prior to the meeting,  
shall notify each of its stockholders who was such on the record date for   
such meeting with respect to shares for which appraisal rights are          
available pursuant to subsections (b) or (c) hereof that appraisal rights   
are available for any or all of the shares of the constituent corporations, 
and shall include in such notice a copy of this section. Each stockholder   
electing to demand the appraisal of such stockholder's shares shall deliver 
to the corporation, before the taking of the vote on the merger or          
consolidation, a written demand for appraisal of such stockholder's shares. 
Such demand will be sufficient if it reasonably informs the corporation of  
the identity of the stockholder and that the stockholder intends thereby to 
demand the appraisal of such stockholder's shares. A proxy or vote against  
the merger or consolidation shall not constitute such a demand. A           
stockholder electing to take such action must do so by a separate written   
demand as herein provided. Within 10 days after the effective date of such  
merger or consolidation, the surviving or resulting corporation shall       
notify each stockholder of each constituent corporation who has complied    
with this subsection and has not voted in favor of or consented to the      
merger or consolidation of the date that the merger or consolidation has    
become effective; or                                                        

(2) If the merger or consolidation was approved pursuant to (S)228 or 
(S)253 of this title, each constituent corporation, either before the       
effective date of the merger or consolidation or within ten days            
thereafter, shall notify each of the holders of any class or series of      
stock of such constituent corporation who are entitled to appraisal rights  
of the approval of the merger or consolidation and that appraisal rights    
are available for any or all shares of such class or series of stock of     
such constituent corporation, and shall include in such notice a copy of    
this section; provided that, if the notice is given on or after the         
effective date of the merger or consolidation, such notice shall be given   
by the surviving or resulting corporation to all such holders of any class  
or series of stock of a constituent corporation that are entitled to        
appraisal rights. Such notice may, and, if given on or after the effective  
date of the merger or consolidation, shall, also notify such stockholders   
of the effective date of the merger or consolidation. Any stockholder       
entitled to appraisal rights may, within 20 days after the date of mailing  
of such notice, demand in writing from the surviving or resulting           
corporation the appraisal of such holder's shares. Such demand will be      
sufficient if it reasonably informs the corporation of the identity of the  
stockholder and that the stockholder intends thereby to demand the          
appraisal of such holder's shares. If such notice did not notify            
stockholders of the effective date of the merger or consolidation, either   
(i) each such constituent corporation shall send a second notice before the 
effective date of the merger or consolidation notifying each of the holders 
of any class or series of stock of such constituent corporation that are    
entitled to appraisal rights of the effective date of the merger or         
consolidation or (ii) the surviving or resulting corporation shall send     
such a second notice to all such holders on or within 10 days after such    
effective date; provided, however, that if such second notice is sent more  
than 20 days following the sending of the first notice, such second notice  
need only be sent to each stockholder who is entitled to appraisal rights   
and who has demanded appraisal of such holder's shares in accordance with   
this subsection. An affidavit of the secretary or assistant secretary or of 
the transfer agent of the corporation that is required to give either       
notice that such notice has been given shall, in the absence of fraud, be   
prima facie evidence of the facts stated therein. For purposes of           
determining the stockholders entitled to receive either notice, each        
constituent corporation may fix, in advance, a record date that shall be    
not more than 10 days prior to the date the notice is given, provided, that 
if the notice is given on or after the effective date of the merger or      
consolidation, the record date shall be such effective date. If no record   
date is fixed and the notice is given prior to the effective date, the      
record date shall be the close of business on the day next preceding the    
day on which the notice is given.                                           

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  (e) Within 120 days after the effective date of the merger or consolidation,
the surviving or resulting corporation or any stockholder who has complied with 
subsections (a) and (d) hereof and who is otherwise entitled to appraisal       
rights, may file a petition in the Court of Chancery demanding a determination  
of the value of the stock of all such stockholders. Notwithstanding the         
foregoing, at any time within 60 days after the effective date of the merger or 
consolidation, any stockholder shall have the right to withdraw such            
stockholder's demand for appraisal and to accept the terms offered upon the     
merger or consolidation. Within 120 days after the effective date of the merger 
or consolidation, any stockholder who has complied with the requirements of     
subsections (a) and (d) hereof, upon written request, shall be entitled to      
receive from the corporation surviving the merger or resulting from the         
consolidation a statement setting forth the aggregate number of shares not      
voted in favor of the merger or consolidation and with respect to which demands 
for appraisal have been received and the aggregate number of holders of such    
shares. Such written statement shall be mailed to the stockholder within 10     
days after such stockholder's written request for such a statement is received  
by the surviving or resulting corporation or within 10 days after expiration of 
the period for delivery of demands for appraisal under subsection (d) hereof,   
whichever is later.                                                             

  (f) Upon the filing of any such petition by a stockholder, service of a copy
thereof shall be made upon the surviving or resulting corporation, which shall  
within 20 days after such service file in the office of the Register in         
Chancery in which the petition was filed a duly verified list containing the    
names and addresses of all stockholders who have demanded payment for their     
shares and with whom agreements as to the value of their shares have not been   
reached by the surviving or resulting corporation. If the petition shall be     
filed by the surviving or resulting corporation, the petition shall be          
accompanied by such a duly verified list. The Register in Chancery, if so       
ordered by the Court, shall give notice of the time and place fixed for the     
hearing of such petition by registered or certified mail to the surviving or    
resulting corporation and to the stockholders shown on the list at the          
addresses therein stated. Such notice shall also be given by 1 or more          
publications at least 1 week before the day of the hearing, in a newspaper of   
general circulation published in the City of Wilmington, Delaware or such       
publication as the Court deems advisable. The forms of the notices by mail and  
by publication shall be approved by the Court, and the costs thereof shall be   
borne by the surviving or resulting corporation.                                

(g) At the hearing on such petition, the Court shall determine the        
stockholders who have complied with this section and who have become entitled   
to appraisal rights. The Court may require the stockholders who have demanded   
an appraisal for their shares and who hold stock represented by certificates to 
submit their certificates of stock to the Register in Chancery for notation     
thereon of the pendency of the appraisal proceedings; and if any stockholder    
fails to comply with such direction, the Court may dismiss the proceedings as   
to such stockholder.                                                            

(h) After determining the stockholders entitled to an appraisal, the Court
shall appraise the shares, determining their fair value exclusive of any        
element of value arising from the accomplishment or expectation of the merger   
or consolidation, together with a fair rate of interest, if any, to be paid     
upon the amount determined to be the fair value. In determining such fair       
value, the Court shall take into account all relevant factors. In determining   
the fair rate of interest, the Court may consider all relevant factors,         
including the rate of interest which the surviving or resulting corporation     
would have had to pay to borrow money during the pendency of the proceeding.    
Upon application by the surviving or resulting corporation or by any            
stockholder entitled to participate in the appraisal proceeding, the Court may, 
in its discretion, permit discovery or other pretrial proceedings and may       
proceed to trial upon the appraisal prior to the final determination of the     
stockholder entitled to an appraisal. Any stockholder whose name appears on the 
list filed by the surviving or resulting corporation pursuant to subsection (f) 
of this section and who has submitted such stockholder's certificates of stock  
to the Register in Chancery, if such is required, may participate fully in all  
proceedings until it is finally determined that such stockholder is not         
entitled to appraisal rights under this section.                                

(i) The Court shall direct the payment of the fair value of the shares,   
together with interest, if any, by the surviving or resulting corporation to    
the stockholders entitled thereto. Interest may be simple or compound, as the   
Court may direct. Payment shall be so made to each such stockholder, in the     
case of holders of uncertificated stock forthwith, and the case of holders of   
shares represented by certificates upon the surrender to                        

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the corporation of the certificates representing such stock. The Court's decree 
may be enforced as other decrees in the Court of Chancery may be enforced,      
whether such surviving or resulting corporation be a corporation of this State  
or of any state.                                                                

(j) The costs of the proceeding may be determined by the Court and taxed  
upon the parties as the Court deems equitable in the circumstances. Upon        
application of a stockholder, the Court may order all or a portion of the       
expenses incurred by any stockholder in connection with the appraisal           
proceeding, including, without limitation, reasonable attorney's fees and the   
fees and expenses of experts, to be charged pro rata against the value of all   
the shares entitled to an appraisal.                                            

(k) From and after the effective date of the merger or consolidation, no  
stockholder who has demanded appraisal rights as provided in subsection (d) of  
this section shall be entitled to vote such stock for any purpose or to receive 
payment of dividends or other distributions on the stock (except dividends or   
other distributions payable to stockholders of record at a date which is prior  
to the effective date of the merger or consolidation); provided, however, that  
if no petition for an appraisal shall be filed within the time provided in      
subsection (e) of this section, or if such stockholder shall deliver to the     
surviving or resulting corporation a written withdrawal of such stockholder's   
demand for an appraisal and an acceptance of the merger or consolidation,       
either within 60 days after the effective date of the merger or consolidation   
as provided in subsection (e) of this section or thereafter with the written    
approval of the corporation, then the right of such stockholder to an appraisal 
shall cease. Notwithstanding the foregoing, no appraisal proceeding in the      
Court of Chancery shall be dismissed as to any stockholder without the approval 
of the Court, and such approval may be conditioned upon such terms as the Court 
deems just.                                                                     

  (l) The shares of the surviving or resulting corporation to which the shares
of such objecting stockholders would have been converted had they assented to   
the merger or consolidation shall have the status of authorized and unissued    
shares of the surviving or resulting corporation. (Last amended by Ch. 339, L.  
'98, eff. 7-1-98.)                                                              

F-4 

DEFM14A
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 REVOCABLE PROXY
 BRIDGEPORT MACHINES, INC.

[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE                                      

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS FOR USE AT THE  
SPECIAL MEETING OF STOCKHOLDERS TO BE HELD AT 11:00 A.M., LOCAL TIME, ON        
WEDNESDAY, JULY 14, 1999.                                                       
 The undersigned hereby appoints Dan L. Griffith and Walter C. Lazarcheck, and
each of them as Proxies, each with full power of substitution, to represent and 
to vote as designated herein all the shares of Common Stock of Bridgeport       
Machines, Inc. (the "Company") held of record by the undersigned on June 4, 1999
at the Special Meeting of Stockholders to be held at 11:00 a.m., local time, on 
Wednesday, July 14, 1999, at Lehman Brothers Inc., 3 World Financial Center, 200
Vesey Street, 17th Floor Main Conference Room, New York, New York 10285 or any  
adjournment or adjournments thereof.                                            

1. To approve and adopt the Agreement and Plan of Merger, dated as of April 23, 
1999, by and among Goldman Industrial Group, Inc., Bronze Acquisition Corp.     
("Merger Sub") and the Company and the transactions contemplated thereby,       
including the merger of Merger Sub with and into the Company.                   

 [ ] FOR [ ] AGAINST [ ] ABSTAIN

2. In his discretion, the Proxy is authorized to vote on such other business as 
may properly come before the Special Meeting.                                   

PROPERLY EXECUTED PROXIES WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY THE
UNDERSIGNED. IF NO SUCH DIRECTIONS ARE GIVEN, SUCH PROXIES WILL BE VOTED "FOR"  
PROPOSAL 1.                                                                     

  When signing as attorney, executor, administrator, trustee or guardian, please
give full title as such. If stockholder is a corporation, corporate name should 
be signed by an authorized officer and the corporate seal affixed. If           
stockholder is a partnership, please sign in partnership name by authorized     
persons. For joint accounts, each joint owner should sign.                      

 Please be sure to sign and date
this Proxy in the box below.

------------------------------
Date

------------------------------
Stockholder sign above

------------------------------
 Co-holder (if any) sign above

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Detach above card, sign, date and mail in postage paid
envelope provided.

 BRIDGEPORT MACHINES, INC.

  PLEASE MARK, SIGN, DATE AND MAIL YOUR PROXY CARD TODAY

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘DEFM14A’ Filing		Date		First		Last			Other Filings
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		12/31/99		11		72
		7/14/99		2		93
Filed on:		6/9/99		2		4
		6/4/99		3		93
		5/24/99		12		26
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		4/23/99		3		93			8-K
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		4/20/99		34		66
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		3/25/99		18		63
		3/15/99		18		44			8-K
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		2/27/99		23
		1/22/99		44					SC 13G/A
		1/19/99		18		66
		1/12/99		44
		1/2/99		13		55			10-Q
		1/1/99		12		73
		12/31/98		44
		10/3/98		13					10-Q
		9/4/98		23
		7/22/98		44					SC 13D/A
		6/27/98		13					10-Q
		5/8/98		17
		4/22/98		23
		4/3/98		17
		3/28/98		13		61			10-K
		3/27/98		41
		12/27/97		13					10-Q
		9/27/97		13					10-Q
		6/28/97		13					10-Q
		9/6/96		41
		3/30/96		54
		1/1/96		21		87
		9/7/95		41
		6/23/94		86
		6/22/94		42		58
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