BY AND AMONG

AGREEMENT AND PLAN OF REORGANIZATION

BY AND AMONG

GENMAR HOLDINGS, INC.

POS ACQUISITION CORPORATION

PYRAMID OPERATING SYSTEMS, INC.

AND

THE STOCKHOLDERS OF PYRAMID OPERATING SYSTEMS, INC.

DATED AS OF JUNE 18, 1999

TABLE OF CONTENTS

PAGE
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ARTICLE I. THE MERGER. . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
1.1 The Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
1.2 Action by Stockholders of the Company. . . . . . . . . . . . . . . . . .2
1.3 Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
1.4 Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
1.5 Effect of the Merger . . . . . . . . . . . . . . . . . . . . . . . . . .5
1.6 Certificate of Incorporation . . . . . . . . . . . . . . . . . . . . . .5
1.7 Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
1.8 Directors and Officers . . . . . . . . . . . . . . . . . . . . . . . . .5
1.9 Waiver(s) Under and Termination of Stockholders' Agreement . . . . . . .6
1.10 Subsequent Actions . . . . . . . . . . . . . . . . . . . . . . . . . . .6

ARTICLE II. CONVERSION OF SECURITIES AND EXCHANGE . . . . . . . . . . . . . . .7
2.1 Alternative Consideration. . . . . . . . . . . . . . . . . . . . . . . .7
2.2 Effect of Merger on Company Common Stock . . . . . . . . . . . . . . . .9
2.3 Warrants and Options . . . . . . . . . . . . . . . . . . . . . . . . . .9
2.4 Unregistered Shares. . . . . . . . . . . . . . . . . . . . . . . . . . .9
2.5 Stock Certificate Legends. . . . . . . . . . . . . . . . . . . . . . . 10
2.6 Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2.7 Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

ARTICLE III. REPRESENTATIONS AND WARRANTIES OF THE COMPANY . . . . . . 12
3.1 Organization and Good Standing . . . . . . . . . . . . . . . . . . . . 12
3.2 Power and Authority. . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.3 Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . 12
3.4 No Violations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.5 Equity Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.6 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.7 Real Property. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.8 Contracts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.9 Intellectual Property. . . . . . . . . . . . . . . . . . . . . . . . . 14
3.10 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.11 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.12 Environmental and Safety Matters . . . . . . . . . . . . . . . . . . . 15
3.13 Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.14 Tax Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.15 Finders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.16 Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.17 Employee Benefit Matters . . . . . . . . . . . . . . . . . . . . . . . 17
3.18 Year 2000 Compliance . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.19 Absence of Certain Business Practices. . . . . . . . . . . . . . . . . 18
3.20 Relationship with Related Persons. . . . . . . . . . . . . . . . . . . 19

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3.21 Labor Matters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3.22 Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS OF THE
COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.1 Enforceability . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.2 Title to Company Common Stock. . . . . . . . . . . . . . . . . . . . . 20
4.3 No Conflicts; Required Filings and Consents. . . . . . . . . . . . . . 20

ARTICLE V. REPRESENTATIONS AND WARRANTIES OF GENMAR AND THE MERGER
SUBSIDIARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
5.1 Organization and Qualification . . . . . . . . . . . . . . . . . . . . 21
5.2 Power and Authority. . . . . . . . . . . . . . . . . . . . . . . . . . 21
5.3 No Conflicts; Required Filings and Consents. . . . . . . . . . . . . . 21
5.4 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . 21
5.5 Investigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
5.6 No Disposition of the Company Assets . . . . . . . . . . . . . . . . . 22

ARTICLE VI. ADDITIONAL COVENANTS. . . . . . . . . . . . . . . . . . . . . . . 22
6.1 Access to Information. . . . . . . . . . . . . . . . . . . . . . . . . 22
6.2 Agreement to Cooperate . . . . . . . . . . . . . . . . . . . . . . . . 22
6.3 Assignment of Contracts and Rights . . . . . . . . . . . . . . . . . . 22
6.4 Conduct of Business. . . . . . . . . . . . . . . . . . . . . . . . . . 23
6.5 Standstill Agreement . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.6 Notification of Certain Matters. . . . . . . . . . . . . . . . . . . . 24
6.7 Public Announcements . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.8 Release from Personal Guarantees . . . . . . . . . . . . . . . . . . . 24
6.9 Future Investment Opportunity. . . . . . . . . . . . . . . . . . . . . 25
6.10 Interim Working Capital Funding. . . . . . . . . . . . . . . . . . . . 25
6.11 Representations by Stockholders of the Company . . . . . . . . . . . . 26
6.12 Suspension of the Operating Agreement of Pyramid Marine, LLC . . . . . 26
6.13 Release of Partnership by the Company. . . . . . . . . . . . . . . . . 26

ARTICLE VII. CLOSING CONDITIONS. . . . . . . . . . . . . . . . . . . . . . . . 27

7.1 Conditions to the Obligations of Each Party to Effect the Merger . . . 27
7.2 Conditions to Obligations of Genmar and the Merger Subsidiary. . . . . 27
7.3 Conditions to Obligations of the Company . . . . . . . . . . . . . . . 29
7.4 Actions Regarding Conditions . . . . . . . . . . . . . . . . . . . . . 30

ARTICLE VIII. TERMINATION, AMENDMENT AND WAIVER . . . . . . . . . . . . . . . . 30
8.1 Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
8.2 Effect of Termination. . . . . . . . . . . . . . . . . . . . . . . . . 32
8.3 Effect of Investigation. . . . . . . . . . . . . . . . . . . . . . . . 32

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ARTICLE IX. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . 32
9.1 Indemnification by the Company and Stockholders of the Company . . . . 32
9.2 Indemnification by Genmar and Merger Subsidiary. . . . . . . . . . . . 33
9.3 Nature and Survival of Representations and Warranties. . . . . . . . . 33
9.4 Procedure for Indemnification. . . . . . . . . . . . . . . . . . . . . 33

ARTICLE X. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

ARTICLE XI. MISCELLANEOUS AND GENERAL . . . . . . . . . . . . . . . . . . . . 40
11.1 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
11.2 Legal and Other Costs. . . . . . . . . . . . . . . . . . . . . . . . . 41
11.3 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.4 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.5 Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.6 Cooperation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.7 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
11.8 Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
11.9 Preservation of and Access to Records. . . . . . . . . . . . . . . . . 42
11.10 Public Announcements . . . . . . . . . . . . . . . . . . . . . . . . . 42
11.11 Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
11.12 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
11.13 Scope of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . 43
11.14 Number and Gender. . . . . . . . . . . . . . . . . . . . . . . . . . . 43
11.15 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
11.16 Parties in Interest and Assignment . . . . . . . . . . . . . . . . . . 43
11.17 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
11.18 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
11.19 Facsimile Signatures . . . . . . . . . . . . . . . . . . . . . . . . . 44

EXHIBITS
Exhibit A - Delaware Certificate of Merger (Section 1.4)
Exhibit B - Certificate of Incorporation of Surviving Corporation
(Section 1.6)
Exhibit C - Genmar Note (Section 2.1)
Exhibit D - List of Company Warrants and Options (Section 2.3)
Exhibit E - List of Critical Employees (Section 7.2(f))
Exhibit F - List of Company Record Date Stockholders of the Company (Last
Clause-Signature Page)

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AGREEMENT AND PLAN OF REORGANIZATION

This Agreement and Plan of Reorganization ("Agreement") is dated as of
June 18, 1999, by and among GENMAR HOLDINGS, INC., a Delaware corporation,
("Genmar"), POS ACQUISITION CORPORATION, a Delaware corporation and a first
tier wholly owned subsidiary of Genmar (the "Merger Subsidiary"), PYRAMID
OPERATING SYSTEMS, INC., a Delaware corporation (the "Company") and the
STOCKHOLDERS set forth on the execution page hereof who join in this
Agreement (on or after the date hereof) specifically to represent, warrant
and covenant as to certain matters as set forth herein (the "Stockholders").

RECITALS

A. The Company and Merger Subsidiary have agreed to carry out a
business combination transaction upon the terms and subject to the conditions
of this Agreement and in accordance with the general corporation law of the
State of Delaware, (the "DBCL"), pursuant to which the Company will merge
with and into the Merger Subsidiary (the "Merger") and the stockholders of
the Company will convert their equity holdings in the Company in accordance
with the provisions of Article II hereof.

B. The Board of Directors of the Company has determined that the
Merger is in the best interests of the Company and the stockholders of the
Company and has approved and adopted this Agreement, the Merger and the
Transactions as a convenient means to accomplish the transactions contemplated
herein and to cause the stockholders of the Company to surrender their Company
Common Stock in exchange for the right to receive the Merger Consideration.

C. The Board of Directors of the Company has approved this Agreement,
the Merger, and the Transactions, and will recommend approval and adoption of
this Agreement, the Merger and the Transactions by the stockholders of the
Company.

D. The Stockholders have, pursuant to Section 1.2(a) of this
Agreement, each covenanted and agreed to vote affirmatively for adoption and
approval of this Agreement and shall take all additional actions as may be
necessary to adopt and approve this Agreement pursuant to any special meeting
of, or written consent action by, the stockholders of the Company.

E. The Board of Directors of Genmar has (i) approved and adopted this
Agreement on behalf of Genmar, and (ii) approved the Merger and the Transactions
as the sole Stockholder of the Merger Subsidiary.

F. The Board of Directors of the Merger Subsidiary has approved and
adopted this Agreement.

AGREEMENT

In consideration of the foregoing Recitals and the respective
representations, warranties, covenants and agreements set forth in this
Agreement, the parties agree as follows:

ARTICLE I.

THE MERGER

1.1 THE MERGER. Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the laws of the State of
Delaware, and the specific provisions of the DBCL, upon the time when the
certificate of Merger is filed with the Secretary of State of the State of
Delaware, or at such other time as the parties may agree upon in writing,
pursuant to Applicable Law (the "Effective Date") the Company will be merged
with and into the Merger Subsidiary. As a result of the Merger, the separate
existence of the Company will cease and the Merger Subsidiary will continue as
the surviving corporation of the Merger (the "Surviving Corporation").

1.2 ACTION BY STOCKHOLDERS OF THE COMPANY.

a) APPROVAL BY STOCKHOLDERS. The Company, acting through its
Board of Directors, will, in accordance with Applicable Law and its
Organizational Documents: (i) as soon as practicable, duly call, give notice
of, convene and hold a special meeting of the stockholders of the Company
holding Company Common Stock (including the Company Common Stock held by Genmar)
on the "record date" established by the Company's Board of Directors for the
purpose of adopting and approving this Agreement, the Merger and the
Transactions (the "Special Meeting"), which approval shall require, by agreement
of the Parties, at least 90% of such Company Common Stock, and (ii) use its best
efforts to obtain the 90% approval necessary for adoption of this Agreement, the
Merger, and the Transactions by the stockholders of the Company at or pursuant
to the Special Meeting, all in accordance with the DBCL. The Special Meeting
and the adoption and approval described herein, shall take place and be obtained
respectively, not later than July 15, 1999. The Stockholders who are
signatories to this Agreement covenant and agree that they will each, severally,
(i) vote all of their Company Common Stock in favor of approval and adoption of
this Agreement, the Merger and the Transactions, and (ii) shall not exercise
Dissenter's Rights.

b) APPROVAL BY COMPANY BOARD OF DIRECTORS. The Company
represents that its Board of Directors has (i) determined that this Agreement,
the Merger and the Transactions are in the best interest of the Company and the
stockholders of the Company, (ii) approved this Agreement, the Merger, and the
Transactions, which approval satisfies in full the requirements of the Company's
Organizational Documents and applicable requirements of the DBCL, and
(iii) resolved to recommend approval and adoption by the stockholders of the
Company of this Agreement, the Merger and the Transactions to the extent and in
a manner required by Applicable Law.

c) APPROVAL BY MERGER SUBSIDIARY STOCKHOLDER. (i) Genmar has
approved and adopted this Agreement, the Merger and the Transactions, on behalf
of itself and on behalf of the Merger Subsidiary as the sole stockholder of the
Merger Subsidiary, and (ii) the Board of Directors

of the Merger Subsidiary has approved and adopted this Agreement, the Merger
and the Transactions, in each case in accordance with Applicable Law.

d) APPROVAL DATES. The approvals required by (i) Section
1.2(a) shall occur on or before July 15, 1999, and (ii) Sections 1.2(b) and (c)
occurred prior to the execution of this Agreement.

1.3 CLOSING. Unless this Agreement is terminated pursuant to the
provisions of Article VIII hereof and the Merger and the Transactions have
been abandoned, and subject to the satisfaction or, if possible, waiver of
the conditions set forth in Article VII hereof, the closing of the Merger
(the "Merger Closing") will take place at the alternative times set forth in
Sections 1.3(a) or 1.3(b) below.

a) GENMAR INITIAL PUBLIC OFFERING. In the event Genmar
completes an initial public offering pursuant to an Underwriting Agreement
and issues and sells Genmar stock in a firm commitment public offering (the
"Public Offering") registered on Form S-1 in accordance with the requirements
of the Securities Act of 1933 as amended (the "Act"), on or before March 31,
2000, the Merger Closing will take place within ten (10) business days (such
date to be selected by Genmar in its discretion) subsequent to the closing of
the Public Offering at the offices of Xxxxxx and Xxxxxx, P.A., 0000 XXX
Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx at 10:00 a.m. local time, or on such other
date or such other place and time as determined by Genmar (the "Public
Offering Closing Date"), subject to the termination provisions of Article
VIII of this Agreement.

b) NO PUBLIC OFFERING.

(i) In the event that a Public Offering of Genmar Common
Stock is not closed on or before March 31, 2000, the
Merger Closing shall take place at the offices of
Xxxxxx and Xxxxxx, P.A. at the address set forth
above at 10:00 a.m. local time on April 1, 2000, or
within thirty (30) days thereafter, such exact date
to be established in the sole discretion of Genmar
(the "Secondary Closing Date"), subject to the
termination provisions of Article VIII of this
Agreement. Notwithstanding the foregoing, in the
event that Genmar determines in good faith that a
Public Offering is unlikely to occur on or before
March 31, 2000 and such determination is made prior
to December 15, 1999, then the Company may request
that the Secondary Closing Date be scheduled, and
the Merger Closing occur prior to the end of
business on December 31, 1999.

(ii) In the event that the transaction described in
Section 1.3(b)(i) above and 2.1(b) occurs, the
Parties hereto and the stockholders of the Company
(upon approval and adoption of this Agreement) agree
that the following alternative (mutually exclusive)
transaction structures shall be utilized to effect
the transfer of the Company Common Stock, in each
case with the alternative details and consequences
of such alternative structure to be satisfactory to
Genmar and its counsel, as compared to the Merger:

A) the stockholders of the Company will effect a
direct transfer of the Company Common Stock
to Genmar in exchange for the Notes. The
purchase price for each share of Company
Common Stock shall be Note Merger
Consideration computed in accordance with the
formula set forth in Section 2.1(b)
hereinbelow. The alternative set forth in
this Section shall not be available under
this Agreement unless every share of Company
Common Stock participates in the transfer.
In the event this stock sale alternative is
selected by the Company (i) the Company and
the shareholders of the Company shall provide
written notice of the selection under this
Section to Genmar not less than fourteen (14)
days prior to any anticipated Closing Date,
(ii) the Merger will not take effect, and
(iii) the stockholders of the Company shall
be required hereunder to deliver their stock
certificates representing the Company Common
Stock to be transferred, along with executed
stock powers endorsed in blank. All other
provisions of this Agreement necessary to
effect the provisions of this Section shall
remain in full force and effect, except to
the extent that a provision of this Agreement
is inconsistent with this Section and must
be, and hereby is, conformed by the operation
of this Agreement and the terms of this
Section, to be consistent with the direct
stock sale described hereinabove.

B) the Merger form under this Agreement will be
changed from a "forward" merger to a
"reverse" merger with the following
attributes: (i) Genmar shall liquidate the
Merger Subsidiary and a new subsidiary of
Genmar will be formed (the "New Merger
Subsidiary") and will be merged with and into
the Company, which shall change the
definition of "Merger" under this Agreement,
(ii) as a result of the Merger, the separate
existence of the New Merger Subsidiary will
cease and the Company will continue as
Surviving Corporation, and (iii) the Note
Merger Consideration will be determined in
accordance with Section 2.1(b). In the event
that this "reverse" merger alternative is
selected by the Company, the Company shall
provide notice to Genmar not less than
fourteen (14) days prior to any anticipated
Closing Date. All other provisions of this
Agreement necessary to effect the provisions
of this Section shall remain in full force
and effect, except to the extent that a
provision of this Agreement is inconsistent
with this Section and must be, and hereby is,
conformed by the operation of the terms of
this Section to be consistent with the
reverse merger described herein.

The other provisions of this Agreement shall be interpreted and
construed to reasonably implement the foregoing provisions, including without
limitations references to the effect of the Merger on the parties to this
Agreement.

In connection with any Merger Closing with no Public Offering, Genmar
shall deliver to the stockholders of the Company, at addresses provided by
the Company, at least fifteen (15) days prior to the Merger Closing, audited
financial statements for its fiscal year ended June 30, 1999 and quarterly
unaudited financial statements for the most recent fiscal quarter, together
with narrative information that is comparable to that provided to Genmar's
significant vendors.

c) CLOSING DATE DEFINITION. The term "Closing Date" shall
refer in the alternative to the Public Offering Closing Date or the Secondary
Closing Date, both of which shall be deemed a "Merger Closing", as applicable
to the particular circumstances of the closing of this Agreement, the Merger
and the Transactions.

1.4 EFFECTIVE DATE. On the Closing Date, the parties will cause
the Merger to be consummated by filing a Certificate of Merger with the
Secretary of State of the State of Delaware, pursuant to and in accordance
with the DBCL, substantially in the form attached hereto as EXHIBIT A. The
Merger will become effective on the Effective Date.

1.5 EFFECT OF THE MERGER. From and after the Effective Date, the
Surviving Corporation will possess all the rights, privileges, powers and
franchises and be subject to all of the restrictions, disabilities and duties
of the Company, and the Merger Subsidiary and the Merger will otherwise have
the effects as provided under the DBCL. The outstanding shares of Company
Common Stock (other than the Company Common Stock held by Genmar , which
shall be canceled) shall be converted into the Merger Consideration, and the
outstanding shares of the capital stock of the Merger Subsidiary shall be
unaffected by the Merger, all on the basis, terms and conditions described in
Article II hereof.

1.6 CERTIFICATE OF INCORPORATION. From and after the Effective
Date, the Certificate of Incorporation of the Surviving Corporation will be
substantially in the form attached hereto as EXHIBIT B until amended in
accordance with Applicable Law, and the name of the Surviving Corporation
shall be the name of the Company or such other name as Genmar may elect.

1.7 BYLAWS. From and after the Effective Date, the bylaws of the
Surviving Corporation shall be the bylaws of the Merger Subsidiary in effect
immediately prior to the Effective Date.

1.8 DIRECTORS AND OFFICERS. From and after the Effective Date, until
successors are duly elected or appointed and qualified (or their earlier
resignation or removal) in accordance with Applicable Law, the directors and
officers of the Surviving Corporation shall be as follows:

DIRECTORS

Xxxxx X. Xxxxxxxxx
Xxxxx X. Xxxxxxxx XX
Xxxx X. Xxxxxxxxx

OFFICERS

Xxxxx X. Xxxxxxxxx President
Xxxxx X. Xxxxxxxx XX Vice President
Xxxx X. XxXxxxxxx Vice President, Secretary
Xxxx X. Xxxxxxxxx Vice President
Xxxx X. Xxxxxx Vice President

From and after the Effective Date, the officers and directors of the
Company prior to the Effective Date shall be deemed resigned for all purposes,
except as may be necessary or desirable pursuant to the provisions of Section
1.10 hereof.

1.9 WAIVER(S) UNDER AND TERMINATION OF STOCKHOLDERS' AGREEMENT. By
virtue of the respective approvals of this Agreement, the Merger and the
Transactions (i) by the stockholders of the Company (including Genmar)
pursuant to Section 1.2(a), and/or (ii) by the Stockholders by execution of
this Agreement, and (iii) by Genmar, the Company, the stockholders of the
Company, the Stockholders and the Company covenant and agree that any
provision(s) of the Stockholders' Agreement by and among the Company, Genmar
and the Pyramid Investors (as defined by the Stockholders' Agreement) made
and entered into on March 23, 1999 (the "Stockholders' Agreement") which
require or prohibit certain acts, omissions or procedures in connection with
the execution and approval of this Agreement, the Merger or the Transactions
are hereby irrevocably waived and/or amended to conform with or to otherwise
allow the operation of this Agreement, the Merger or the Transactions without
violation of, or the giving a right of action with respect to any stockholder
of the Company under, the Stockholders' Agreement. Upon the Effective Date,
the stockholders of the Company, including Genmar, by their approval of this
Agreement, the Merger and the Transactions, hereby agree that the
Stockholders' Agreement shall be terminated with no further action of the
stockholders of the Company or the Company, and upon such termination the
Stockholders' Agreement shall be null, void and of no further force or
effect.

1.10 SUBSEQUENT ACTIONS. If, at any time after the Effective Date,
the Surviving Corporation shall consider or be advised that any deeds, bills
of sale, assignments, assurances or any other actions or things are necessary
or desirable to perfect or confirm of record or otherwise vest in the
Surviving Corporation its right, title or interest in, to, or under any of
the rights, properties or assets of the Company or the Merger Subsidiary
acquired or to be acquired by the Surviving Corporation, as a result of, or
in connection with, the Merger or otherwise to carry out this Agreement, the
officers and directors of the Surviving Corporation are authorized to execute
and deliver, in the name and on behalf of the Company and the Merger
Subsidiary, as applicable, all such deeds, bills of sale, assignments and
assurances, and to take and do, in the name and on behalf of the Company or
the Merger Subsidiary, and all such other actions and things as may be
necessary or desirable to vest, perfect or confirm any and all right, title
and interest in, to and under such rights, properties or assets in the
Surviving Corporation or otherwise to carry out the purposes of this
Agreement.

ARTICLE II.

CONVERSION OF SECURITIES AND EXCHANGE

2.1 ALTERNATIVE CONSIDERATION. The parties acknowledge and agree
that in the event the Merger is consummated subsequent to the Public Offering
of Genmar stock (the "Genmar Public Shares") in accordance with Section
1.3(a), the consideration for the Merger shall be the right to receive shares
of Genmar Common Stock and the other consideration as set forth in Section
2.1(a) below. In the event, however, that the Merger is consummated prior to
any Public Offering in accordance with Section 1.3(b), the consideration for
the Merger shall be non-negotiable unsecured, subordinated interest bearing
notes, substantially in the form attached hereto as EXHIBIT C, issued by
Genmar dated as of the Effective Date in accordance with Section 2.1(b) below
(the "Notes"). The Notes shall have a maturity at least two (2) years beyond
Genmar's longest term debt maturity date and bear interest at one percent
(1%) over Genmar's effective borrowing rate under its revolving line of
credit facility at the Effective Date, as determined by Genmar.

a) MERGER PURSUANT TO PUBLIC OFFERING. In the event that
the Merger takes place pursuant to the Public Offering, at the Effective Date
by virtue of the Merger each share of Company Common Stock (excluding Company
Common Stock held by Genmar, which shall cease to exist upon the Merger at
the Effective Date) will be converted into the right to receive shares of
Genmar Common Stock (such Genmar Common Stock, the "Stock Merger
Consideration") pursuant to the following formula:

$12,275,000 the number of shares of Company Common
--------------------- DIVIDED BY Stock (excluding Company Common Stock held
Public Offering Price by Genmar)

After taking into account the set-off pursuant to Section 2.1(e) below, which
is anticipated to amount to $1,275,000, fractional shares of Genmar Common
Stock shall be issued, and in lieu thereof stockholders of the Company shall
be paid cash by Genmar equal to such fractional share multiplied by the
Public Offering Price.

"Public Offering Price" is the initial offering price in the Public Offering of
the Genmar Public Shares.

b) MERGER WITHOUT PUBLIC OFFERING. In the event that the
Public Offering has not taken place on or before March 31, 2000, each share of
Company Common Stock (excluding Company Common Stock held by Genmar) will, after
taking into account the set-off pursuant to Section 2.1(e) below, which is
anticipated to amount to $1,275,000, be converted into the right to receive a
dollar value which represents a portion of principal of a Note to be issued to
each stockholder of the Company (other than Genmar) (the "Note Merger
Consideration"), determined by dividing (after application of the set-off
provision in Section 2.1(e)):

(x) $12,275,000, BY

(y) the total number of Company Common Stock shares (excluding
Company Common Stock held by Genmar).

c) DISSENTING SHARES. Notwithstanding anything to the
contrary in this Agreement, Dissenting Shares (as defined below) shall not be
converted into the right to receive Merger Consideration (as defined in
paragraph (d) below), but holders of such shares shall be entitled to receive
payment of the appraised value of such shares in accordance with the
provisions of Section 262 of the DBCL, except that any Dissenting Shares held
by a stockholder of the Company who shall thereafter withdraw such demand for
appraisal of such shares, or shall lose the right of appraisal as provided in
such Section 262, shall thereupon be deemed to have been converted at the
Effective Date into the right to receive the Merger Consideration, without
interest thereon. In the event the aggregate Dissenting Shares of Company
Common Stock equals two and one-half percent (2 1/2%) or less of the shares
held by the stockholders of the Company (determined by reference to the
stockholder record date established by the Company Board of Directors with
respect to this Agreement and the Transactions, Genmar shall direct, at its
own cost and expense all negotiations and proceedings with respect to demands
for appraisals under the DBCL and shall be responsible for paying any and all
amounts required to be paid to the holders of Dissenting Shares thereunder
and any other amounts due to Dissenting Shares as a result of this Agreement
and the consummation of the Transactions). In the event such Dissenting
Shares exceed two and one-half percent (2 1/2%) of such Company Common Stock,
(i) the non-dissenting stockholders of the Company shall direct, at their
sole cost and expense, all negotiations and proceedings with respect to
demands for appraisals under the DBCL and shall be responsible for paying any
and all amounts required to be paid to the holders of Dissenting Shares as a
result of this Agreement and the Transactions, and (ii) Genmar shall have the
right to withhold the Merger Consideration associated with such Dissenting
Shares plus $500,000 of Merger Consideration which shall be used for the
costs and expenses of the Dissenting Shareholder action. The non-dissenting
stockholders of the Company shall share all such costs, expenses and payments
pro rata in accordance with their right to receive the Merger Consideration
(after application of the set-off provision in Section 2.1(e)). Subsequent
to settlement or disposal of the matters relating to Dissenting Shares, the
balance, if any, of such withheld Merger Consideration shall be distributed
pro-rata to the non-dissenting stockholders of the Company in accordance with
the previous sentence. For purposes of this Agreement, "Dissenting Shares"
shall mean common stock of the Company held by any stockholder of the Company
who properly demands appraisal rights pursuant to Section 262 of the DBCL and
who may thereby become entitled to the payment of the fair value of such
common stock shares held by such stockholder under the DBCL.

d) MERGER CONSIDERATION. The Stock Merger Consideration,
the Note Merger Consideration and the cash payments for fractional shares may
also be referred to herein, either individually or collectively, as the
"Merger Consideration."

e) RIGHT OF SETOFF. To the extent that any stockholder of
the Company is indebted to the Company at the Effective Date, whether or not
such debt is then due and owing, (i) Genmar shall reduce the Merger
Consideration otherwise transferable and/or payable to such stockholder by
the full amount of such debt, (ii) the debt shall be canceled, to the extent
and amount of the offset, and (iii) the reduction of debt shall be recorded
as a contribution of capital by Genmar in the records of the Surviving
Corporation. The debt described herein that is not currently due on

the date hereof but which is accelerated pursuant to the foregoing provision,
shall be discounted by 9% from the date hereof (to reflect the time value of
money). The Parties acknowledge and agree that $1,275,000 of the $12,275,000
amount set forth above shall be offset pursuant to the terms hereof.

2.2 EFFECT OF MERGER ON COMPANY COMMON STOCK. Each share of Company
Common Stock issued and outstanding immediately prior to the Effective Date
shall, by virtue of the Merger and without any action on the part of the holder
thereof, cease to exist and shall be canceled.

2.3 WARRANTS AND OPTIONS. All of the Company's Warrants and Options
are set forth on EXHIBIT D hereto.

a) WARRANTS HELD BY STOCKHOLDERS. Any Warrants held by any
Stockholder shall, by operation of this Agreement, and without further action,
be canceled and terminated as of the Effective Date. Any Warrants held by any
other stockholder of the Company following approval of this Agreement, the
Merger and the Transactions by such stockholder either by execution or approval
of this Agreement pursuant to Section 1.2(a), shall, without further action, be
canceled and terminated as of the Effective Date.

b) WARRANTS HELD BY OTHERS. Unless canceled or exercised
prior to the Effective Date by the holders thereof, all Warrants of the Company
held by any Person not a stockholder of the Company shall, by virtue of the
Merger, become Warrants to purchase that amount of Merger Consideration as would
have been issuable to the holder of any such Warrants upon the Effective Date,
if the Warrant had been exercised immediately prior to the Effective Date, with
the same aggregate exercise price for the Warrants for the Merger Consideration
as exists immediately prior to the Effective Date.

c) COMPANY STOCK OPTION PLAN. In accordance with the terms of
the Company's Stock Option Plan of 1999, all Options issued thereunder may be
exercised in accordance with their terms by the Option holders during the period
from the scheduling of the Closing and the provision of notice of such scheduled
Closing Date until 5:00 p.m. one (1) day prior to the scheduled Merger Closing.
Unless Genmar in its sole discretion elects to assume or substitute other
options for any unexercised Options to acquire common stock of the Company, all
such unexercised options shall by virtue of the Merger be without further action
canceled and terminated as of the Effective Date.

2.4 UNREGISTERED SHARES. The stockholders of the Company have been
informed by Genmar that the Merger Consideration (either in the form of Genmar
Common Stock or the Notes) has not been registered under the Act, and that (i)
such Genmar Common Stock must be held for the time required by SEC Rule 144,
unless (a) the distribution for sale of the Genmar Common Stock has been
registered under the Act in accordance with Section 2.6 hereof or otherwise, (b)
a sale of the Genmar Common Stock is made in conformity with the provisions of
SEC Rule 144 or (c) in the opinion of counsel, which opinion is reasonably
acceptable to Genmar, some other exemption from registration is available with
respect to any other sale, transfer or other disposition of such Genmar Common
Stock, and (ii) the Notes are nonnegotiable, subordinated and unsecured, and may
not be sold or otherwise transferred under any circumstances (except to Genmar).

2.5 STOCK CERTIFICATE LEGENDS. Each stockholder of the Company
acknowledges and understands that stock transfer instructions will be given to
Genmar's transfer agent with respect to the Merger Consideration and that there
will be placed on the certificates for the Genmar Common Stock, or any
substitution therefor, the following legend:

"The securities represented by this Certificate have
been issued without registration under the
Securities Act of 1933, (the "Act") or any State
securities laws. They may not be sold, assigned,
pledged or otherwise transferred for value unless
they are registered under the Act and any applicable
state securities laws or the Company receives an
opinion of counsel satisfactory to it, or otherwise
satisfies itself, that registration is not
required."

2.6 REGISTRATION.

a) REQUIRED REGISTRATION. In the event that Genmar Common
Stock is issued in connection with the Merger, within nine (9) months after the
Effective Date, Genmar shall prepare and file one registration statement under
the Act, covering the shares of Genmar Common Stock issued in connection with
the Merger and shall use commercially reasonable efforts to cause such
registration statement to become effective. Genmar shall be obligated to
prepare, file and cause to become effective only one registration statement
pursuant to this paragraph and to pay the expenses associated with such
registration statement. Genmar's obligation to keep such registration statement
effective shall cease (i) two (2) years after the date upon which it is first
declared effective by the SEC, or (ii) upon the replacement of such registration
statement by an effective registration of the Genmar Common Stock on Form S-3 as
described in Section 2.6(b) below.

b) FORM S-3 REGISTRATION. Any time that Genmar is eligible to
use Form S-3, and Genmar desires to use Form S-3 for registration hereunder,
Genmar shall prepare and file one registration statement under the Act, covering
the remaining shares of Genmar Common Stock which are the subject of the prior
Form S-1 registration statement that have not been sold pursuant thereto and
shall use reasonable commercial efforts to cause such registration statement to
become effective. Genmar shall be obligated to prepare, file and cause to
become effective only one registration statement pursuant to this paragraph and
to pay the expenses associated with such registration statement. Genmar's
obligation to keep such registration statement effective shall cease two (2)
years after the date the first registration of the Genmar Common Stock was first
declared effective by the SEC.

c) COOPERATION FOR RULE 144 TRANSFERS. After the expiration
of the effectiveness of any and all registration statements in Section (a) or
(b) above, Genmar shall provide reasonable assistance to facilitate the sale
under SEC Rule 144 of any remaining Genmar Common Stock not sold pursuant to
such registration statements.

d) OTHER REGISTRATION MATTERS. The stockholders of the
Company shall provide to Genmar all additional information that is not otherwise
available to Genmar pursuant to the transactions contemplated hereby as Genmar
deems necessary (in conformity with Applicable Laws) for the preparation and
filing of a registration statement. Genmar may (i) suspend sales of the

Xxxxxx Xxxxxx Stock pursuant to the registration statement filed pursuant to
this Section 2.6 if it determines in good faith that it contains statements
that are materially misleading or omits to state material information
required to be included therein or necessary to make the registration
statement not misleading until such time as the misleading statement(s) or
omission(s) have been corrected by Genmar acting with all reasonable
diligence, and (ii) delay registration for a period of up to ninety (90) days
if it determines, in good faith, that such registration would have a material
adverse effect on Genmar.

2.7 INDEMNITY.

a) INDEMNIFICATION BY STOCKHOLDERS. If Genmar Common Stock
is registered pursuant to Section 2.6 hereof, each stockholder of the Company
will severally, in accordance with each such shareholder's pro rata ownership
interest in the Genmar Common Stock which was registered pursuant to the
registration statement(s) set forth in Section 2.6 above, indemnify and hold
harmless Genmar, each officer of Genmar who signs a registration statement
filed pursuant to Section 2.6 and each director of Genmar, against all
losses, claims, damages or liabilities to which Genmar or such officer or
director may become subject arising out of any untrue statement of any
material fact contained in the registration statement, any final prospectus
contained therein or any amendment or supplement thereof, or arising out of
the omission to state therein the material fact required to be stated therein
or necessary therein not misleading; PROVIDED, HOWEVER, that the stockholders
of the Company shall have such obligation to indemnify only in each case to
the extent that such untrue statement or omission was made by Genmar in
reliance upon, and in strict conformity with, accurately described written
information furnished by the stockholders of the Company specifically for use
in preparation of the registration statement. The stockholders of the
Company shall have the right to review and approve, through their counsel,
any such registration statement, or part thereof, which describes the
stockholders of the Company, the transactions contemplated by this Agreement
or the Company and its operations within three (3) business days prior to its
submission to the SEC. Notwithstanding the foregoing provisions of this
Section 2.7, the stockholders of the Company shall have no liability or other
indemnification obligation with respect to any financial projections or other
such forward looking information disclosed in the registration statement by
Genmar, whether or not such information pertains to the Company or was
provided or prepared by the stockholders of the Company.

b) INDEMNIFICATION BY GENMAR. Genmar agrees to indemnify and
hold harmless each stockholder of the Company selling Genmar Common Stock that
is registered pursuant to Section 2.6 against all losses, claims, damages or
liabilities to which such stockholder of the Company may become subject arising
out of any untrue statement of material fact contained in the registration
statement and final prospectus contained therein or any amendment or supplement
thereof arising out of the omission to state therein the material fact required
to be stated therein or necessary to make the statements therein not
misleading; PROVIDED, HOWEVER, that Genmar shall have no such obligation to
indemnify to the extent that such untrue statement or omission was made in
reliance upon, in strict conformity with, accurately described information
furnished by the stockholders of the Company specifically for use in the
preparation of the registration statement.

c) LIMITATION ON LIABILITY OF THE HOLDERS OF GENMAR COMMON
STOCK. The liability of each holder of Genmar Common Stock in respect of any
indemnification or contribution obligation of such holder arising under this
Section shall not in any event exceed an amount equal to such holder's pro-rata
portion of the Merger Consideration.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

As an inducement to Genmar and Merger Subsidiary to enter into this
Agreement and to consummate the transactions contemplated hereby, the Company
represents and warrants to Genmar and Merger Subsidiary that the following
representations and warranties are true and correct:

3.1 ORGANIZATION AND GOOD STANDING. The Company is duly organized,
validly existing and in good standing under the laws of the State of
Delaware, and has the requisite corporate power and authority to own its
properties and to carry on its business as now conducted. True and correct
copies of the Certificate of Incorporation and By-laws of the Company as
currently in effect have been delivered to Genmar. The Company is qualified
to do business as a foreign corporation and is in good standing in each other
jurisdiction where the conduct of its business or the ownership, leasing or
occupancy of its properties requires such qualification, licensing or good
standing, except where the failure to be so qualified, licensed or in good
standing could not, individually or in the aggregate, have a material adverse
effect on (i) the business, operations, condition (financial or otherwise) or
prospects of the Company, or (ii) the ability of the Company to enter into,
deliver, and perform this Agreement and/or any of the Transactions, or
otherwise effect the Merger.

3.2 POWER AND AUTHORITY. The Company has all requisite power and
authority to enter into this Agreement, the Merger and the Transactions and to
perform fully its obligations hereunder and thereunder and to consummate the
Transactions. The execution and delivery of this Agreement and the performance
and completion of the Transactions by the Company and its obligations hereunder
and thereunder have been duly and validly authorized by all necessary action on
the part of the Company and its stockholders. Each of the Agreement and the
Transactions is a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms.

3.3 CONSENTS AND APPROVALS. Except as disclosed in SCHEDULE 3.3, no
filings with, notices or reports to, authorizations, registrations, consents or
approvals of, or exemptions from, any governmental or regulatory authority,
agency, court, commission or other similar entity, domestic (either national,
state or local) or foreign ("Governmental Entity") or any other person are
required to be made or obtained by the Company or the Partnership in connection
with the execution and delivery of this Agreement by the Company or the
Transactions contemplated hereby or thereby, the failure to obtain which is
likely to have a material adverse effect.

3.4 NO VIOLATIONS. Except as disclosed in SCHEDULE 3.4, the execution
and delivery of this Agreement by the Company and the performance of its
obligations hereunder and the consummation of the Transactions (a) do not and
shall not conflict with or violate any provision of the Certificate of
Incorporation or By-laws of the Company and (b) do not and shall not (i)
conflict

with or result in a breach of the terms, conditions or provisions of, (ii)
constitute, with or without the passage of time or the giving of notice or
both, a default under, (iii) result in the creation of any lien, mortgage,
charge, encumbrance, interest or restriction (each, an "Encumbrance") upon
any interests in or assets of the Company pursuant to, (iv) give any third
party the right to modify, terminate, cancel or accelerate any obligation
under, (v) result in a violation of, or (vi) require any authorization,
registration, consent or approval of, exemption from, or other action by, or
notice or report to, any court pursuant to, any agreement, commitment,
Contract, instrument, lease, obligation, decree, judgment or order to which
the Company or the Partnership, or any of their respective assets are subject
or by which any of them is bound.

3.5 EQUITY INTERESTS. The Company has one class of common stock, par
value $.00001 per share ("Common Stock"), which is currently held by the Persons
and in the amounts shown on SCHEDULE 3.5, and are duly authorized, validly
issued and outstanding, fully paid and non-assessable. Except as disclosed on
SCHEDULE 3.5, there shall be no outstanding subscriptions, options, warrants or
other rights to acquire from the Company any shares of Company Common Stock or
other securities of the Company, no outstanding securities that are convertible
into, exercisable for or exchangeable for any Common Stock or other securities,
and no stock appreciation, phantom stock or similar rights relating to the
Company.

3.6 FINANCIAL STATEMENTS. Each of the financial statements of the
Company previously delivered to Genmar and the related notes and schedules,
including, without limitation, the balance sheet and income statement for each
period prior to and ending on May 31, 1999 (the "Financial Information"), all of
which are free of material misstatement and fairly present the financial
position of the Company as of their respective dates in accordance with
generally accepted accounting principles consistently applied ("GAAP"). The
books of account and other records of the Company are complete and correct in
all material respects and have been maintained in accordance with sound business
practices, and there have been no transactions involving the business of the
Company which properly should have been set forth therein and which have not
been accurately so set forth.

3.7 REAL PROPERTY. SCHEDULE 3.7 contains a legal description of
the real property currently owned, used or leased by the Company
(collectively, the "Real Property"). The Company has the right to quiet
enjoyment of all Real Property leased by it for the full term, including all
renewal rights, of the lease or similar agreement relating thereto. Except
as set forth in SCHEDULE 3.7, no default under or right of the lessor to
terminate any lease or other written or oral agreement under which the
Company has the right to use any of the Real Property presently exists or
shall occur as a result of the execution of this Agreement or the
consummation of the Transactions, including the Merger. Notwithstanding
disclosure of such default or right of the lessor to terminate any lease, the
Company shall be obligated hereunder as an additional covenant of this
Agreement to cure all such defaults and/or obtain a waiver of any right to
terminate that may now exist or exists on the Closing Date. All structures
and other improvements on all Real Property are within the lot lines and do
not encroach on the properties of any other Person, and the use and operation
of all Real Property conform to all Applicable Laws, including all material
applicable building, zoning, safety and subdivision laws and Environmental
and Safety Requirements, and all restrictive covenants and restrictions
conditions affecting title. Neither the Company nor the Partnership has
received written or oral notice of assessments for public improvements or
condemnation against any Real Property.

3.8 CONTRACTS. Except as set forth on SCHEDULE 3.8, the Company is
not in breach of any of the Contracts and no event has occurred or circumstance
exists that (with or without notice or lapse of time) may contravene, conflict
with, or result in a violation or breach of any Contract, nor, to the best of
the Company's knowledge, is any third party in breach of any such Contract.
Each Contract of the Company is in full force and effect and is enforceable in
accordance with its terms. True and complete copies of all Contracts have
previously been made available to Genmar.

3.9 INTELLECTUAL PROPERTY. The Company owns and possesses all right,
title and interest in and to, or has the right to acquire a written, enforceable
license to use, all of its Intellectual Property free and clear of all
Encumbrances and other interests, except as set forth on SCHEDULE 3.9. The
Company owns and possesses all right, title and interest in and to all
Intellectual Property necessary or required for the ownership, license and other
use and operation of the Company's Personal Property (as defined in Section 3.13
below), including the right to license or lease such Intellectual Property
and/or Personal Property to third parties. The Company has full ownership
rights and interests in and to all of the trade secrets used in connection with
its Personal Property, which trade secrets have not been used, disclosed or
appropriated by any individual or entity not subject to an enforceable
confidentiality/non-disclosure agreement or obligation. Except as set forth on
SCHEDULE 3.9, no claim by any third party contesting the validity,
enforceability, use or ownership of any Intellectual Property has been made or
is threatened against the Company or any Affiliate of the Company, and there are
no grounds for any such claim. The Company has not infringed or misappropriated
any Intellectual Property and no such claim has been made or threatened against
the Company or the Partnership, and there are no grounds for any such claim. The
operation of the Company's business will not result in the infringement or
misappropriation of any Intellectual Property rights of third parties. The
Company has taken reasonable and prudent steps to protect the Intellectual
Property from infringement by any other individual or entity. "Intellectual
Property" means: all patents, patent applications, patent disclosures and
inventions (whether or not patentable and whether or not reduced to practice);
all trade names, trademarks, trade dress, logos and all goodwill associated
therewith; all copyrights, copyrightable work, and mask works; all registrations
and applications and renewals for any of the foregoing; all trade secrets,
manufacturing and production processes and techniques, technical and computer
data, documentation and software, software licenses, financial, business and
marketing plans, customer and supplier lists and all tangible embodiments
thereof.

3.10 LITIGATION. Except as set forth on SCHEDULE 3.10 hereto: (i)
there are no civil, criminal or administrative claims, actions, suits,
investigations or proceedings pending or threatened against the Company or any
affiliate of the Company before or by any court or other Governmental Entity,
and (ii) the Company is not subject to any injunction, order or other decree of
any court or other Governmental Entity of competent jurisdiction.

3.11 COMPLIANCE WITH LAWS. The Company is and has been in material
compliance with all Applicable Laws. Except where failure to do so would not
have a material adverse effect, the Company possesses, and is in compliance
with, all licenses, permits, approvals and other governmental authorizations
necessary to the conduct of its business, and such licenses, permits, approvals
and authorizations shall not be affected, directly or indirectly, by the
consummation of this Agreement, the Merger or the Transactions.

3.12 ENVIRONMENTAL AND SAFETY MATTERS.

a) DEFINITIONS. "Environmental and Safety Requirements" means
all federal, state and local laws, ordinances, rules, regulations and similar
provisions having the force or effect of law, all judicial and administrative
permits, orders and determinations, all Contractual Obligations and all other
Applicable Laws concerning public health and safety, worker health and safety,
and pollution or protection of the environment.

b) COMPLIANCE. The Company has complied, and is in material
compliance, with all applicable Environmental and Safety Requirements, and
neither the Company nor the Partnership has received any notice, report or
information regarding any liabilities (whether absolute, accrued, contingent,
unliquidated or otherwise), or any corrective, investigatory or remedial
obligations, arising under Environmental and Safety Requirements.

c) PERMITS, LICENSES AND AUTHORIZATION. Except as set forth
in SCHEDULE 3.12 hereto, there are no permits, licenses and other authorizations
required pursuant to Environmental and Safety Requirements for the operation of
the business in the manner contemplated by the Company.

d) HANDLING OF MATERIALS. The Company and the Partnership
have generated, transported, stored, handled, disposed of or contracted for the
disposal of hazardous materials only in accordance with all Environmental and
Safety Requirements. To the Knowledge of the Company, no employee of the
Company has, in the course and scope of employment with the Company or the
Partnership, been exposed to any hazardous materials in such a manner as to be
materially harmed thereby (whether such harm is now known to exist or will be
discovered in the future). The Company and the Partnership are not listed as a
potentially responsible party under CERCLA or any comparable or similar federal
or state statute, and neither the Company nor any of its Affiliates has received
notice of such listing and no Knowledge of any facts or circumstances which
could give rise to such a listing. As used in this Section 3.12, "hazardous
materials" means the storage, transportation, disposal or treatment of hazardous
materials, as defined and regulated by applicable Environmental and Safety
Requirements.

e) STATUS OF REAL PROPERTY. All owned and leased real
property used by the Company has been operated and is in compliance with all
material respects with all Environmental and Safety Requirements, including all
Applicable Laws related to underground and/or above ground petroleum storage
tanks. The Company and its Affiliates have complied in all material respects
with all Applicable Laws, including Environmental and Safety Requirements, and
have obtained or taken appropriate steps, as required by such laws, to obtain
all environmental, health and safety permits, consents, approvals, licenses and
other authorizations necessary for the ownership, lease and operation of the
Company's business. To the Knowledge of the Company, all Real Property on which
operations of the Company are conducted are free of any and all environmental
conditions and hazardous materials and is not subject to any environmental claim
or "super fund"-type Encumbrances arising from the release or threatened release
of any hazardous materials in, on, about or under such Real Property.

f) THIRD PARTY DISPOSALS. To the Knowledge of the Company,
all third parties with which the Company has arranged, engaged or contracted to
accept, treat, transport, store, dispose or remove any pollutant or hazardous
materials generated or present in any real estate operated by the Company or the
Partnership, or which otherwise participates or has participated in activities
or conduct related to the Real Property or the business, were properly
permitted at the relevant time to perform the foregoing activities or conduct.

g) XXXXX AND TANKS. Any xxxxx or underground and/or above
ground storage tanks (whether or not currently in use) on any parcel of Real
Property used by the Company are in sound condition, are not leaking and comply
in all material respects with all applicable Environmental and Safety
Requirements.

h) PROHIBITED USAGE. No part of any parcel of the Real
Property used by the Company is now being used, nor to the Company's Knowledge
has any parcel of such Real Property ever been used as a landfill, dump or other
disposal, storage, transfer, treating or handling area for any hazardous
materials, or as a facility for selling, dispensing, storing, transferring,
treating or handling hazardous materials.

i) PENDING INVESTIGATIONS. The Company has no Knowledge of
either itself or any Affiliate being subject to any investigation (and have not
received any written notification) of any judicial or administrative proceeding,
notice, order, judgment, decree or settlement alleging or addressing (i) any
violation of Environmental and Safety Requirements, or (ii) any environmental
claims or liabilities and costs arising from the release or threatened release
of any hazardous materials.

3.13 PROPERTY. The Company has good and marketable title to all
Personal Property owned by it, free and clear of all Encumbrances, other than
Encumbrances reflected on SCHEDULE 3.13 hereto. Except for defaults under
certain Contracts due to late payments, the Company has the right to quiet
enjoyment of all tangible Personal Property leased by it for the full term,
including all renewal rights, of the lease or similar agreement relating
thereto. All personal property owned or leased by the Company is referred to
herein as the "Personal Property". Except as reflected on SCHEDULE 3.3, no
default under or right of the lessor to terminate any lease or other written or
oral agreement under which the Company or the Partnership has the right to use
any Personal Property shall occur as a result of the execution of the Agreement
or the consummation of the Transactions.

3.14 TAX MATTERS.

a) DEFINITIONS. The term "Tax" (or "Taxes" where applicable)
means any federal, state, local or foreign income, gross receipts, withholding,
sales, AD VALOREM or transfer tax, including any interest, penalties or
additions to tax in respect of the foregoing, whether disputed or not, and the
term "Tax Liability" means any liability (whether absolute or contingent,
whether liquidated or unliquidated, and whether due or to become due) with
respect to Taxes.

b) TAX FILINGS. The Company has timely filed all required Tax
reports and returns, and all such Tax reports and returns are correct and
complete. Except as indicated in SCHEDULE 3.14 hereto, all Taxes arising from
the operations of the Company or the Partnership have

been paid or adequately reserved for, whether or not such Taxes are shown on
any Tax report or return. Neither the Company nor the Partnership has any
obligation to indemnify or otherwise assume or succeed to the Tax Liability
of any other Person.

c) WITHHOLDINGS. The Company has withheld and paid all Tax
Liabilities required to have been withheld and paid in connection with amounts
paid or owing to any employee, creditor, independent contractor or other third
party.

3.15 FINDERS. No broker's, finder's or any similar fee has been or
shall be incurred by or on behalf of the Company in connection with the origin,
negotiation, execution or delivery of any of the Collateral Documents or the
consummation of the transactions contemplated hereby or thereby.

3.16 INSURANCE. All insurance policies taken out by or on behalf of
the Company are valid, enforceable and in full force and effect. All
premiums with respect to such policies covering all periods up to and
including the date as of which this representation, and as of the Effective
Date, have been paid or properly accrued and no written notice of late
payment, cancellation or termination has been received with respect to any
such policy. The insurance policies and risk management policies of the
Company are sufficient for compliance with all requirements of Applicable Law
and agreements to which the Company is a party and provide insurance for the
risks and in the amounts and types of coverage usually obtained by persons
using or holding similar properties in similar businesses. Except as set
forth in SCHEDULE 3.16 hereto, there have been no claims made for insurance
payment under any of the insurance policies by the Company or the Partnership
preceding the date of this Agreement. Complete and accurate copies of
insurance policies of the Company and all endorsements thereto have been
delivered to Genmar. Except as set forth in SCHEDULE 3.16, the Company has
not been refused any insurance coverage and no insurance coverage has been
canceled.

3.17 EMPLOYEE BENEFIT MATTERS.

a) Except as set forth on SCHEDULE 3.17, the Company does
not maintain or contribute and has no actual or potential liability with
respect to any (i) deferred compensation or bonus or retirement plans or
arrangement, (ii) qualified or nonqualified defined contribution or defined
benefit plans or arrangement which are employee pension benefit plans (as
defined in Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")), or (iii) employee welfare benefit plans, (as
defined in Section 3(1) of ERISA), stock option or stock purchase plans, or
material fringe benefit plans or programs whether in writing or oral and
whether or not terminated. The Company has never contributed to any
multiemployer pension plan (as defined in Section 3(37) of ERISA), and the
Company has never maintained or contributed to any defined benefit plan (as
defined in Section 3(35) of ERISA). The plans, arrangement, programs and
agreements referred to the preceding two sentences are referred to
collectively as the "Plans." The Company does not maintain or contribute to
any Plan which provides health, accident or life insurance benefits to former
employees, their spouses or dependents, other than in accordance with Section
4980B of the Code ("COBRA") or similar state law.

b) The Plans (and related trusts and insurance contracts) set
forth on SCHEDULE 3.17 hereto comply in form and in operation with the
requirements of Applicable Laws, including ERISA and the Code and the
nondiscrimination rules thereof. All contributions, premiums or payments which
are due on or before the date hereof and as of the Closing Date under each Plan
have been paid. Each Plan which is intended to be qualified under Section
401(a) of the Code (i) has been amended on a timely basis in compliance with the
Code and (ii) has received form the Internal Revenue Service a favorable
determination letter which considers the terms of such Plan and its material
amendments.

c) All required reports and descriptions (including Form 5500
Annual Reports, Summary Annual Reports and Summary Plan Descriptions) with
respect to the Plans have been properly and timely filed with the appropriate
government agency as required and distributed to participants, as required. The
Company has complied with the requirements of COBRA.

d) To the Knowledge of the Company (i) there have been no
prohibited transactions as defined in Section 406 of ERISA or Section 4975 of
the Code and (ii) no fiduciary (as defined in Section 3(21) of ERISA) has any
liability for breach of fiduciary duty or any other failure to act or comply in
connection with the administration or investment of the assets thereof (other
than routine claims for benefits) are pending or threatened.

e) The Company has not incurred and has no reason to expect
that it will incur, any liability to the Pension Benefit Guaranty Corporation
(other than routine premium payments) or otherwise under Title IV of ERISA
(including any withdrawal liability) or under the Code with respect to any
employee pension benefit plan (as defined in Section 3(2) of ERISA) that the
Company or any member of a "controlled group" (within the meaning of Code
Section 414) maintains or ever has maintained or to which any of them
contributes, ever has contributed, or ever has been required to contribute.

3.18 YEAR 2000 COMPLIANCE. To the Knowledge of the Company, after due
inquiry, the Computer Systems (defined below) of the Company are Year 2000
Compatible (defined below). For purposes of this Agreement, "Year 2000
Compatible" shall mean, with respect to any Computer System, that such Computer
System (i) records, stores, processes and provides true and accurate dates and
calculations for dates and spans of dates, (ii) is and will be able to operate
on a basis comparable to its current operation during and after calendar year
2000 A.D., including, but not limited to, leap years, and (iii) shall not end
abnormally or provide invalid or incorrect results as a result of date data
which represents or references (or fails to represent or reference) different
centuries or more than one century. For purposes of this Agreement, "Computer
System" shall mean any and all computer software programs, semiconductor chips,
microprocessors, embedded microcontrollers and other hardware containing
programming instructions of any kind, whether owned or licensed or otherwise
held by the Company.

3.19 ABSENCE OF CERTAIN BUSINESS PRACTICES. Neither the Company, the
Partnership nor any officer, partner, employee, representative or other agent of
the Company has, directly or indirectly, since inception of the Company or the
Partnership given or agreed to give any gift or similar benefit to any customer,
supplier, governmental employee or other person or entity who is or may be in a
position to help or hinder the business of either the Company or the Partnership
(or assist either the

Company or the Partnership in connection with any actual or proposed
transaction) which (i) might subject the Company or its Affiliates to any
damage or penalty in any civil, criminal or governmental litigation or
proceeding, (ii) if not given in the past, might have had an adverse effect
on the assets, business or operations of the Company or its Affiliates as
reflected in its historical financial statements, or (iii) if not continued
in the future, might adversely affect the Company's assets, business,
operations or prospects or which might subject the Company to suit or penalty
in any private or governmental litigation or proceeding.

3.20 RELATIONSHIP WITH RELATED PERSONS. Since December 31, 1998,
excluding Genmar, the shareholders of the Company nor any of its directors,
officers and employees and their Related Persons (as defined below) have not
had any interest in any of the properties or assets of the Company and do not
own, of record or as a beneficial owner, any equity interest or other
financial or profit interest in any entity that (i) has had business dealings
or a material financial interest in any transaction with the Company (other
than as an employee, consultant, or legal counsel of the Company) or (ii) has
engaged or is engaged in competition with the Company with respect to any
line of products or services of the Company in any market presently served or
proposed to be served by the Company (a "Competing Business") (except for
less than five percent (5%) of the outstanding capital stock of any Competing
Business that is publicly traded on any recognized exchange or in the
over-the-counter market). Except as set forth on SCHEDULE 3.20, no
shareholder, officer or member of the Board of Directors of the Company, and
none of their Related Persons has any claim or right against, the Company,
other than the rights that individuals serving the Company have with respect
to indemnification under state law. "Related Persons" means with respect to
any Person, their Affiliates.

3.21 LABOR MATTERS. The Company has not experienced any attempt to
organize any of its employees for collective bargaining or entering into a
labor contract on behalf of such employees. The Company has not experienced
any employee activity which may be adverse to the Company, including labor
strikes or disturbances. There are no disputes or grievances subject to any
grievance procedure, unfair labor practice proceedings, arbitration or
litigation under such agreements, or as a result of such attempts to
organize, which have not been finally resolved, settled or otherwise disposed
of. The Company is in compliance in all material respects with all
Applicable Laws respecting employment practices, employment documentation,
terms and conditions of employment and wages and hours. There are no labor
practice charges or complaints against or affecting the Company pending
before any applicable Governmental Entity and there are no material facts or
information which would have a reasonable probability of giving rise thereto.

3.22 DISCLOSURE. No representation or warranty by the Company
contained in this Agreement, nor any statement or certificate furnished or to be
furnished by the Company, or their respective representatives, in connection
herewith or pursuant hereto, contains or will contain any untrue statement of
material fact, or omit or will omit to state any material fact required to make
the statements herein or therein contained not misleading. The Company
disclosed to Genmar in writing all material adverse facts known to it relating
to the same.

ARTICLE IV.

REPRESENTATIONS AND WARRANTIES OF THE
STOCKHOLDERS OF THE COMPANY

As an inducement to Genmar and the Merger Subsidiary to enter into
this Agreement and to consummate the transactions contemplated hereby, each
stockholder of the Company (other than Genmar) severally, but not with
respect to any other stockholder of the Company, by approval and adoption (or
execution, as applicable) of this Agreement, the Merger and the Transactions
pursuant to Section 1.2(a), represent and warrant to Genmar and the Merger
Subsidiary that the following representations and warranties are true and
correct:

4.1 ENFORCEABILITY. This Agreement has been duly executed and
delivered by each Party hereto and constitutes, and each Collateral Document
executed or required to be executed by or on behalf of any stockholder of the
Company (other than Genmar) pursuant hereto or thereto when so executed and
delivered will constitute, the legal, valid and binding obligations of the
stockholders of the Company (other than Genmar), enforceable in accordance with
their respective terms.

4.2 TITLE TO COMPANY COMMON STOCK. Except as set forth on SCHEDULE
4.2, each stockholder of the Company, representing and warranting only as to
his or its Company Common Stock, owns and has good and merchantable title to
the Company Common Stock in his or its name in the records of the Company,
free and clear of all Encumbrances or other interests. Notwithstanding any
disclosure on SCHEDULE 4.2 hereof, each stockholder of the Company shall be
obligated on the Effective Date to have removed any Encumbrances and other
interests on his or its Company Common Stock prior to or contemporaneously
with the Merger.

4.3 NO CONFLICTS; REQUIRED FILINGS AND CONSENTS. Neither the
execution nor delivery of this Agreement, the Merger or any Collateral
Document executed or required to be executed pursuant hereto or thereto, nor
the consummation of the Merger and the Transactions, nor compliance with the
terms, conditions and provisions hereof or thereof by the respective
stockholders of the Company (other than Genmar) (i) will conflict with, or
result in a breach or violation of, or constitute a default under, any
Applicable Law or result in a material breach or violation of, or constitute
a default in the performance, observance or fulfillment of, or permit the
acceleration of any obligation or liability in, but for any requirements of
notice or passage of time or both would constitute such a conflict with, any
Contractual Obligation of the stockholders of the Company (ii) will result in
or permit the creation or imposition of any Encumbrance or other interest
upon any property or asset of a stockholder of the Company used or now
contemplated to be used by the Company, or (iii) will require any
governmental authorization or governmental filing, except for filing
requirements in connection with the Merger, the Transactions, and the Act or
applicable state securities laws which may apply to compliance by a
stockholder of the Company.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES OF GENMAR
AND THE MERGER SUBSIDIARY

Genmar and the Merger Subsidiary represent and warrant to the Company as
follows:

5.1 ORGANIZATION AND QUALIFICATION. Each of Genmar and the Merger
Subsidiary is a corporation duly organized, validly existing and in good
standing under the laws of the state of Delaware.

5.2 POWER AND AUTHORITY. Except for receiving lender consents, which
is a condition precedent to the obligations of Genmar and the Merger Subsidiary
to consummate the transactions contemplated by this Agreement, Genmar and the
Merger Subsidiary have all requisite power and authority (corporate and other)
and have in full force and effect all authorizations necessary or desirable in
order to enable them, respectively, to execute and deliver, and to perform their
respective obligations under, this Agreement and each Collateral Document
executed or required to be executed pursuant hereto or thereto and to consummate
the Merger and the Transactions. The execution, delivery and performance of
this Agreement and each Collateral Document executed or required to be executed
pursuant hereto or thereto have been duly authorized by all requisite corporate
or other action. This Agreement has been duly executed and delivered by each of
Genmar and the Merger Subsidiary and constitutes, and each Collateral Document
executed or required to be executed pursuant hereto or thereto when executed and
delivered by it will constitute the legal, valid and binding obligations of
Genmar and the Merger Subsidiary, respectively, enforceable in accordance with
their respective terms.

5.3 NO CONFLICTS; REQUIRED FILINGS AND CONSENTS. Except for
receipt of the consent of Genmar's lenders, as may be necessary in connection
with the consummation of this Agreement and the Transactions, neither the
execution nor delivery of this Agreement or any Collateral Document executed
or required to be executed pursuant hereto or thereto, nor the consummation
of the Merger or the Transactions nor compliance with the terms, conditions
and provisions hereof or thereof by each of Genmar and Merger Subsidiary (i)
will conflict with, or result in a breach or violation of, or constitute a
default under, any Applicable Law on the part of Genmar or the Merger
Subsidiary or will conflict with, or result in a breach or violation of, or
constitute a default under, or permit the acceleration of any obligation or
liability in, or but for any requirement of giving of notice or passage of
time or both would constitute such conflict with, breach or violation of, or
default under, or permit any acceleration in any Contractual Obligation of
Genmar or the Merger Subsidiary, or (ii) will require any authorization,
except for filing requirements under Applicable Law in connection with the
Merger and the Transactions and as the Act and applicable securities laws may
apply to compliance by Genmar with the provisions of this Agreement relating
to the Public Offering.

5.4 FINANCIAL STATEMENTS. Any financial statements of Genmar
delivered to the stockholders of the Company pursuant to Section 1.3 hereof,
shall be free of material misstatement and fairly present the financial position
of Genmar as of their respective dates in accordance with GAAP.

5.5 INVESTIGATION. Genmar and the Merger Subsidiary have
investigated and become generally familiar with the Company and its
operations, including the present condition (financial and otherwise) of the
Company, including the condition of the Company's assets, the level of
protection and documentation (excluding infringement issues and compliance
with the Company's representations and warranties with respect to
Intellectual Property) currently in place with regard to the Company's
Intellectual Property and the current status of the Company with regard to
its loan guarantee obligations and Contractual Obligations to its and the
Partnership's creditors.

5.6 NO DISPOSITION OF THE COMPANY ASSETS. Neither Genmar, nor the
Merger Subsidiary has any agreement, current plan or current intention to
dispose of any substantial portion of the Company's assets following the
Effective Date; provided, however, as a matter of business development or as
circumstances arising after the Effective Date may evolve, the Surviving
Corporation may dispose of any or all of its assets.

ARTICLE VI.

ADDITIONAL COVENANTS

6.1 ACCESS TO INFORMATION. The Company will afford to Genmar and
representatives of Genmar full access during normal business hours throughout
the period prior to the Effective Date to all of the Company's properties,
books, Contracts, commitments and records and, during such period, will
promptly furnish upon request such reports, schedules, filings under
Applicable Law (including without limitation federal or state securities
laws), work papers and other sources of financial information processed or
controlled by the Company or its accountants, and such other information
concerning the Company and stockholders of the Company as Genmar may
reasonably request.

6.2 AGREEMENT TO COOPERATE. The Company and the stockholders of
the Company (upon and after their approval of this Agreement) will use
commercially reasonable efforts to take, or cause to be taken, all actions
and to do, or cause to be done, all things necessary, proper or advisable
under Applicable Law to consummate this Agreement and the Merger and to make
effective the Transactions, including commercially reasonable efforts to (i)
prepare and file all requisite applications and amendments thereto, (ii) to
obtain all necessary appropriate waivers, consents and approvals, including
approvals of stockholders of the Company, and (iii) to lift any injunction or
other legal bar to the Merger and the Transactions. In addition to the
foregoing, the Company covenants to use best reasonable commercial efforts at
or prior to the Effective Date to obtain timely consents of its or the
Partnership's lenders and the administrative agencies affiliated with such
lenders with respect to this Agreement and the Transactions.

6.3 ASSIGNMENT OF CONTRACTS AND RIGHTS. Anything in this Agreement to
the contrary notwithstanding, to the extent allowed by Applicable Law, this
Agreement will not constitute an agreement to assign any claim, Contract,
Contractual Obligation, governmental authorization, lease, private
authorization, commitment, sales, service or purchase order, or any claim, right
or benefit arising thereunder or resulting therefrom, if the Merger or the
Transactions would be deemed an attempted assignment thereof without the
required consent of a third party thereto and would

constitute a breach thereof or in any way affect the rights of Genmar, the
Merger Subsidiary or the Company thereunder.

6.4 CONDUCT OF BUSINESS.

a) Subject to the terms of the Management Agreement made by
and between Genmar and the Company as of June 18, 1999 (the "Management
Agreement"), prior to the Effective Date or the date, if any, on which this
Agreement is earlier terminated, the Company will (i) use its best reasonable
commercial efforts to preserve intact its business organization and goodwill,
keep available the services of its officers and employees as a group and
maintain satisfactory relationships with suppliers, distributors, customers and
others having business relationships with it, (ii) confer on a regular and
frequent basis with one or more representatives of Genmar to report operational
matters of materiality and the general status of ongoing operations, and (iii)
notify Genmar of any emergency or other change in the normal course of its
business and of any governmental complaints, investigations or hearings (or
communications indicating that the same may be contemplated) if such emergency,
change, complaint, investigation or hearing would be material to the business,
operations or financial condition of the Company.

b) Except with the written permission of Genmar and subject to
Genmar's actions taken pursuant to the terms of the Management Agreement, the
Company agrees that the Company (i) will not make, declare or pay any dividends
or other distributions on any Company Common Stock (except cancellation,
modification or reissuance of Options and Warrants), (ii) will not enter into or
terminate any employment arrangement or agreement with any director, officer or
key employee, (iii) will not incur any obligation or liability (absolute or
continuing), except current liabilities incurred, and obligations under
Contracts enter into, in the ordinary course of business, (iv) will not
discharge or satisfy any Encumbrance or pay any obligation or liability
(absolute or contingent) other than the current liabilities shown on its
financial statements, and current liabilities incurred since those dates in the
ordinary course of business, (v) will not mortgage, pledge, create a security
interest in, or subject to lien or other Encumbrance any of its assets, tangible
or intangible, (vi) will not sell or transfer any of its tangible assets or
cancel any debts or claims except in each case in the ordinary course of
business, (vii) will not sell, assign, license or otherwise transfer or grant
any rights in or to any trademark, trade name, patent, or other Intellectual
Property to any third party other than Genmar, (viii) will not waive any right
of any substantial value, (ix) will not make any material change in the tax
procedures or practices followed by the Company, (x) will not make any change in
credit terms offered by or to the Company, (xi) will not make any capital
expenditure or material commitment for any additions or improvements to its
property, plant or equipment, (xii) will not amend its capitalization, or issue
any stocks, bonds or other securities, except that the Company may reissue
options and warrants upon the advice and consent of Genmar and shall issue a
note to Genmar as provided in Section 6.10, (xiii) will not enter into, modify
or extend, or promise any bonus or incentive compensation program that was not
in place prior to June 1, 1999, (xiv) will not terminate the Management
Agreement unless pursuant to a specific right of termination granted therein and
(xv) will otherwise conduct its operations according to its ordinary and usual
course of business.

6.5 STANDSTILL AGREEMENT. Without the written consent of Genmar, the
Company, the Stockholders and the other stockholders of the Company (pursuant to
the approval described in Section 1.2(a)) will not, nor will they permit any of
their respective representatives (including, without limitation, any investment
banker, attorney or accountant) to initiate, or solicit, directly or indirectly,
any inquiries or the making of any proposal with respect to any Other
Transaction (as defined below), engage in any discussions or negotiations
concerning, or provide to any other person any information or data relating to
it or otherwise cooperate in any way with or assist or participate in, the
making of any proposal which constitutes, or may reasonably be expected to lead
to, a proposal to seek or effect an Other Transaction, or agree to or endorse
any Other Transaction; provided, further, the Company and the Stockholders shall
discontinue any currently active discussions regarding an Other Transaction.
The Company will promptly advise Genmar of, and communicate the material terms
of, any proposal it may receive, or any inquiries it receives which may be
reasonably be expected to lead to such a proposal relating to an Other
Transaction, and the identity of the Person making it. The Company will further
advise Genmar of the status and changes in the material terms of any such
proposal or inquiry (or any amendment to any of them). During the term of this
Agreement, the Company will not enter into any agreement, oral or written, and
whether or not legally binding, with any Person that provides for an Other
Transaction, or affects any other obligation of the Company under this
Agreement. For the purpose of this Section 6.5, "Other Transaction" means (i)
any investment in, sale or merger by, or joint venture with, the Company and
(ii) any sale of or the granting of any interest in the Company Common Stock, in
each case other than with or to Genmar or the Merger Subsidiary.

6.6 NOTIFICATION OF CERTAIN MATTERS. The Company will give prompt
notice to Genmar, and Genmar will give prompt notice to the Company, of (a) any
event which would be likely to cause in any material respect (i) any
representation or warranty of the Company or Genmar contained in this Agreement
to be or likely to be untrue or inaccurate, or (ii) in the case of the Company
or the stockholders of the Company, any change to be made in any disclosure
schedule, and (b) any failure of the Company or Genmar, as the case may be, to
comply with or satisfy, or be able to comply with or satisfy, any material
covenant, condition or agreement to be complied with or satisfied by it under
this Agreement.

6.7 PUBLIC ANNOUNCEMENTS. The Company, its stockholders and the
Stockholders shall not issue any press release or otherwise make any public
statement or announcement with respect to this Agreement, the Merger or any
Transaction (including the termination of this Agreement) without the prior
written consent of Genmar. The Company, the Stockholders and the stockholders
of the Company (upon their approval of this Agreement) each acknowledge and
agree that Genmar may, without the prior written consent of the Company, the
Stockholders or the stockholders of the Company, issue such press release or
make such public statements as it deems reasonable or necessary in its sole
discretion. Genmar will not make any statements attributable to the
stockholders of the Company without the prior consent of such stockholders.

6.8 RELEASE FROM PERSONAL GUARANTEES. At or promptly following the
Effective Date, Genmar will obtain releases of the personal guarantees of Xxxx
Xxxxxx, XX to the Company's or the Partnership's lenders and associated
administrative agencies. In the event Genmar is unable to obtain such releases
at or prior to the Effective Date, Genmar shall indemnify and hold Xx. Xxxxxx,
the Partnership and its general partner harmless from such personal guarantees
or obligations; PROVIDED,

HOWEVER, the foregoing covenant shall become effective and enforceable ONLY
in the event of a Merger Closing. Notwithstanding the foregoing, Genmar
covenants and agrees that during the period from the date hereof to the
termination of this Agreement or the Merger Closing, whichever is earlier,
Genmar shall timely make or cause to be made the regular monthly loan
payments to the Partnership lenders (at the present level) or the lease
payments under the Lease Agreement dated March 23, 1999 between the Company
and the Partnership. In the event this Agreement is terminated in accordance
with the provisions of Article VIII hereof, the preceding sentence shall be
null, void, of no further force or effect and shall be wholly unenforceable
with respect to any period from and after the date of such termination.

6.9 FUTURE INVESTMENT OPPORTUNITY. In the event the Surviving
Corporation is successful in the commercialization of VEC-TM- technology and
processes in the marine industry and Genmar or the Surviving Corporation
determines to spin-out one, or more than one, additional non-marine related
business that utilizes VEC-TM- as a core technology of such business, Genmar
and the Merger Subsidiary covenant and agree that they will grant, or cause
to be granted, to the stockholders of the Company (other than Genmar) an
aggregate one time right, on a pro rata basis without right of transfer or
replacement, at the time of the organization of the new spin-off entity to
purchase a total of five percent (5%) (i.e., the stockholders as a group have
the right to purchase five percent (5%), but only on a pro rata basis) of
each such new entity (or entities) at seventy-five percent (75%) of their
five percent (5%) interest in the spin-out entity's value determined by an
independent investment banker or the public markets. The term of the right
shall be thirty (30) days from notification of the completion of the spin-out
and the form of ownership will be voting common stock, or its equivalent in
noncorporate entities. In addition to the foregoing, any sale or license of
the VEC-TM- core technology to a third party shall be treated as a "spin-out"
in which no investment is required, such that the stockholders of the Company
(other than Genmar) shall be entitled to receive in the aggregate five
percent (5%) of such sales or licensing proceeds within thirty (30) days
following receipt of such revenues by Genmar or the Merger Subsidiary, which
proceeds shall be payable in accordance with the pro-rata interest of the
stockholders of the Company in the Merger Consideration received by each such
stockholder. Except as waived and released by any stockholder of the
Company, this future investment opportunity obligation of Genmar shall expire
twenty (20) years after the Effective Date; PROVIDED, HOWEVER, the economic
interests established for each of the shareholders of the Company prior to
the expiration of said twenty (20) year period shall continue thereafter.

6.10 INTERIM WORKING CAPITAL FUNDING. Upon execution of the
Management Agreement by the Company, Genmar covenants and agrees to advance
funds to the Company pursuant to a senior subordinated note (with interest at
nine percent (9%) which will become immediately due and payable on June 30,
2000) to provide working capital and to assist in accomplishing the Company's
project focuses during the term of the Management Agreement. Genmar shall
provide such funds on at least a monthly basis as are projected by Genmar to
be needed for the next month based on the "rolling" three month forecast
prepared by Genmar and presented to the Company from time-to-time pursuant to
the Management Agreement. In the event Genmar (i) does not advance funds, and
does not cure a default in advancing funds within ten (10) days after written
notice by the Company under the Management Agreement, in accordance with the
net expenditures set forth in the monthly forecast (but based on actual
expenditures) or (ii) significantly reduces the project focuses pursuant to
the Management Agreement, where such reductions are not specifically approved
by the

Company's Board of Directors, such uncured non-payment of funds or
significant reduction shall be considered a "Funding Default" hereunder. For
the purposes of this Agreement and the Management Agreement (to the extent it
refers to a Funding Default), a "significant reduction" will be considered to
occur if the current average monthly forecast for project operations (as
opposed to general and administrative costs and factory overhead) is less
than fifty percent (50%) of the previous average monthly forecast presented
by Genmar to the Company, and such reduction is scheduled to continue for the
succeeding two months after presentation. Any such Funding Default based on
a "significant reduction" must be noticed to Genmar in writing by the
Company within five (5) business days of such Funding Default in order to be
defined as such hereunder; otherwise such Funding Default will be deemed
waived.

6.11 REPRESENTATIONS BY STOCKHOLDERS OF THE COMPANY. By (i)
execution of this Agreement; or (ii) approval and adoption of this Agreement,
the Merger and the Transactions, each stockholder of the Company shall be
deemed to make, on a continuing basis to and after the date of such
occurrence, the representations and warranties contained in Article IV, and
Genmar and Merger Subsidiary may rely on such continuing representations from
and after the date(s) thereof, subject to the survival provisions of Section
9.3.

6.12 SUSPENSION OF THE OPERATING AGREEMENT OF PYRAMID MARINE, LLC. The
Company and GPV, Inc., a wholly-owned subsidiary of Genmar, entered into that
certain Operating Agreement of Pyramid Marine, LLC, dated March 23, 1999.
Genmar (on behalf of GPV, Inc.) and Pyramid each confirm and acknowledge that
the terms of said Operating Agreement have not to date been implemented, and
each of Genmar (on behalf of GPV, Inc.) and the Company agree to waive any and
all claims against the other and their respective Affiliates with respect to
such non-implementation and to further suspend any requirements for delivery of
funds, equipment, licenses or sales initiative, or decisions from March 23, 1999
until such time as this Agreement is terminated in accordance with the terms
hereof; PROVIDED, HOWEVER, that the obligations of confidentiality, restrictions
on activities, non-disclosure and similar matters shall continue without
interruption. Upon the Effective Date, Genmar, in its sole discretion, may
terminate, amend, restate or otherwise continue said Operating Agreement.

6.13 RELEASE OF PARTNERSHIP BY THE COMPANY. Immediately prior to the
Closing, the Company (i) may release the Partnership from any and all
liabilities under the Capital Contribution Agreement dated March 23, 1999 and
all related agreements, as well as pursuant to the Equipment and Leased Premises
Lease dated March 23, 1999, and (ii) join with the Partnership in the
termination of such lease agreement. In consideration for such release, as well
as for the obligations set forth in Section 6.8 to release or indemnify the
Partnership and its general partner from liabilities, the Company shall receive
from the Partnership that certain Non-Recourse Term Note and Security Agreement
issued by Xxxx Xxxxxx, XX to the Partnership dated February 28, 1998 in the
principal amount of $1,102,000, and the right to interest accrued or accruing
thereunder.

ARTICLE VII.

CLOSING CONDITIONS

7.1 CONDITIONS TO THE OBLIGATIONS OF EACH PARTY TO EFFECT THE
MERGER. The respective obligations of each party to effect the Merger will be
subject to the satisfaction of the condition that no proceeding before any
Authority or any claim by any Person shall be pending, challenging or seeking
to make illegal, to delay materially or to otherwise directly or indirectly
restrain or prohibit the consummation of the Merger or seeking material
damages or imposing any adverse conditions in connection therewith. The
foregoing shall not apply to stockholders of the Company who assert their
rights with respect to Dissenting Shares. In addition, the foregoing
condition may be waived, in whole or in part, to the extent permitted by
Applicable Law.

7.2 CONDITIONS TO OBLIGATIONS OF GENMAR AND THE MERGER SUBSIDIARY.
The obligations of Genmar and the Merger Subsidiary to effect the Merger will be
subject to the satisfaction at or prior to the Closing Date of the following
conditions, any or all of which may be waived, in whole or in part, to the
extent permitted by Applicable Law:

a) The Company and the stockholders of the Company shall have
complied in all material respects with the agreements contained in this
Agreement;

b) Genmar and its counsel shall have received all information
and copies of all documents, including records of corporate proceedings, which
they may reasonably request in connection therewith, such documents where
appropriate to be certified by proper corporate officers;

c) The Company and the stockholders of the Company (other than
Genmar) shall have furnished Genmar and the Merger Subsidiary with favorable
legal opinions customary for transactions of this type and size, dated the
Effective Date, of their legal counsel;

d) The representations and warranties of the Company contained
in this Agreement or otherwise made in writing by the Company, or on its behalf,
pursuant to this Agreement or otherwise made in connection with the Merger and
the Transactions shall not have been Knowingly false as of the date hereof and
shall be materially true and correct at and as of the Effective Date with the
same force and effect as though made on and as of such date except those which
speak as of a certain date which shall continue to be true and correct as of
such date and the Effective Date. Each and all of the agreements to be
performed are satisfied by the Company or stockholders of the Company under this
Agreement at or prior to the Effective Date shall have been duly performed or
satisfied in all material respects, and the Company and the stockholders of the
Company shall have furnished Genmar with such certificates and other documents
evidencing the truth of such representations and warranties and the performance
of such agreements as Genmar shall have reasonably requested;

e) All actions taken by the stockholders of the Company to
approve and adopt this Agreement, the Merger, and the Transactions (including
the required share percentage to approve) shall (i) comply in all respects
with the provisions of this Agreement, the Merger and the Transactions, and
(ii) be legal, valid, binding, enforceable and effective under Applicable
Laws, the

Company's Certificate of Organization and By-laws and all material
agreements to which the Company is a party or by which it or any of its
property or assets is bound;

f) Between the date of this Agreement and the Effective Date,
there shall not have occurred and be continuing any material changes affecting
the Company which Genmar reasonably determines are materially and fundamentally
adverse, including without limitation:

(i) the loss, or the anticipated loss, of the services
of (i) either Xxxx Xxxxxx XX or Xxxxxx XxXxxxxx or
(ii) any three (3) of the individuals set forth on
EXHIBIT E to this Agreement, unless, in the case of
any such individual(s), Xxxx Xxxxxx XX and Xxxxxx
XxXxxxxx have timely and fully informed Genmar of
specific employment related issues of which they
have Knowledge with respect to any such
individual(s) and Genmar has had a reasonable and
appropriate period of time to address such issues
prior to the loss of such individual(s); or

(ii) more than five percent (5%) of the Company Common
Stock on the record date set by the Board of
Directors of the Company become Dissenting Shares
and such Dissenting Shares shall not be reduced to
five percent (5%) or less on or before August 31,
1999; or

(iii) any injunction or similar action brought by a
third-party materially limiting the use or
value of the Intellectual Property of the
Company for Genmar, or in the marine industry; or

(iv) other significant events that will with substantial
likelihood materially and fundamentally prevent the
Surviving Corporation from pursuing the exploitation
of VEC-TM- Technology or Genmar realizing a return
on its investment.

g) Each of the stockholders of the Company (other than
stockholders who at the Effective Date hold Dissenting Shares) shall have
delivered to Genmar a release satisfactory to Genmar's counsel, dated the
Effective Date, releasing Genmar, the Company and their respective Affiliates
from any and all claims; PROVIDED, HOWEVER, that any Dissenting Shares that
cancel their demand for appraisal shall, in order to receive Merger
Consideration, deliver the same release to Genmar;

h) The representations and warranties of the Stockholders
contained in this Agreement or otherwise made in writing or deemed to have been
made pursuant to this Agreement, by or on behalf of the stockholders of the
Company pursuant to this Agreement or otherwise made in connection with the
Merger and the Transactions shall be true and correct in all material respects
as of the date hereof and at and as of the Effective Date with the same force
and effect as though made on and as of such date except those which speak as of
a certain date which shall continue to be true and correct in all material
respects, as of such date. Each and all of the agreements and conditions to be
performed or satisfied by the stockholders of the Company under this Agreement
at or prior to the Effective Date shall have been duly performed or satisfied in
all material respects;

i) The real estate and equipment leased by the Company from
the Partnership pursuant to the lease agreement dated March 23, 1999 are
transferred to the Company at and only upon Genmar's request (which shall state
the date of transfer) at or prior to the Effective Date, in accordance with the
Genmar request and such lease is terminated PROVIDED, HOWEVER, that Genmar shall
advance to the Company the funds required to pay applicable transfer taxes and
fees and other charges imposed by the Commonwealth of Pennsylvania as well as
any title insurance and closing costs, including reasonable attorney fees as a
direct result of or as needed to complete such transfer. In addition to the
foregoing the Partnership hereby, pursuant to its execution of this Agreement
consents to and pledges to assist in the transfer of such real estate and
equipment;

j) all equity interests held by stockholders of the Company in
the Company shall be determined to the reasonable satisfaction of Genmar's
counsel to be extinguished, including all Company stock, Warrants and Options;

k) the Management Agreement shall be in full force and effect;
PROVIDED, HOWEVER, this Section shall have no force or effect in the event the
Management Agreement was terminated by (i) Genmar without right under the
Management Agreement, or (ii) the Company due to a material breach by Genmar
under the terms of the Management Agreement, including pursuant to an uncured
Funding Default hereunder;

l) each of the consents disclosed by the Company in SCHEDULE
3.3 shall have been obtained prior to the Closing Date; and

m) any and all defaults under any lender debt of the
Partnership or the Company shall be either waived in writing or otherwise
remedied to the reasonable satisfaction of Genmar and its counsel.

7.3 CONDITIONS TO OBLIGATIONS OF THE COMPANY. The obligations of the
Company to effect the Merger will be subject to the satisfaction at or prior to
the Effective Date of the following conditions, any or all of which may be
waived, in whole or in part, to the extent permitted by Applicable Law:

a) Each of Genmar and the Merger Subsidiary shall have
complied in all material respects with their respective agreements contained in
this Agreement, and the certificates to be furnished to the Company pursuant to
this section, shall be true, correct and complete;

b) Genmar and Merger Subsidiary shall have furnished the
Company with favorable legal opinion customary for transactions of this type and
size, dated the Effective Date, of their legal counsel;

c) The representations and warranties of Genmar and the Merger
Subsidiary contained in this Agreement shall be true and correct in all material
respects as of the date hereof and at and as of the Effective Date with the same
force and effect as though made on and as of such date, except those which speak
as of a certain date, which shall continue to be true and correct in all
material respects as of such date. Each and all of the agreements to be
performed or satisfied by each of Genmar and the Merger Subsidiary under this
Agreement at or prior to the Effective Date shall

have been duly performed or satisfied in all material respects, and
each of Genmar and the Merger Subsidiary shall have furnished the Company
with such certificates and other documents evidencing the truth of such
representations and warranties, and the performance of such agreements as the
Company shall have reasonably requested;

d) All actions taken by Genmar or the Merger Subsidiary,
respectively, to approve and adopt this Agreement, the Merger and the
Transactions shall comply in all respects with and shall be legal, valid,
binding, enforceable and effective under the laws of the state of Delaware,
their respective Organizational Documents and all Material Agreements to which
they are party or by which any of their respective property or assets are bound;

e) There exists as of the Effective Date no uncured Funding
Default which would result in personal liability to any stockholder of the
Company;

f) If the Closing Date occurs without a Public Offering, the
stockholders of the Company shall have received the financial and narrative
information required in Section 1.3(b); and

g) The Company shall have received from Genmar, based solely
on its activities under the Management Agreement, from the date of the
Management Agreement through the Effective Date ( or until such earlier date
that the Management Agreement was terminated in accordance with its terms), a
certificate that to its Knowledge that each of the representations and
warranties in Article III remain true and correct (to the extent true and
correct on the date hereof) as of the Effective Date (or such earlier
termination date), except those which speak as of a certain date, which shall
continue to be true and correct as of such date and the Effective Date (or such
earlier termination date); PROVIDED, HOWEVER, the certificate shall not contain
any reference to and shall not be relied upon with respect to Sections 3.1, 3.2,
3.3, 3.4, 3.5, 3.7, 3.9, 3.13, 3.15, 3.17, 3.18, 3.19 or 3.20.

7.4 ACTIONS REGARDING CONDITIONS. In the event a Party hereto
prevents the satisfaction of a condition by the taking of an action or omitting
to act where such action or omission would reasonably be anticipated with
substantial certainty to prevent the consummation of this Agreement and the
Transactions, such Party shall not have the benefit of such condition under this
Agreement with respect to the action or omission in question. Notwithstanding
the foregoing, in the event such action or omission was taken pursuant to any
right under this Agreement, under any other agreement or within such Party's
rights (without violation of this Agreement or any other agreement), such
Party's rights hereunder shall not give rise, in and of itself, to any claim for
breach or default hereunder.

ARTICLE VIII.

TERMINATION, AMENDMENT AND WAIVER

8.1 TERMINATION. This Agreement may be terminated at any time prior
to the Effective Date, whether before or after approval of this Agreement, the
Merger and the Transactions:

a) by mutual consent of the Company, Genmar and the Merger
Subsidiary;

b) by the Company, at any time following an uncured Funding
Default, or in the event of material breach of this Agreement by Genmar or the
Merger Subsidiary that has not been cured, or if any representation or warranty
of Genmar or the Merger Subsidiary shall have become untrue in any material
respect, in either case such that such breach or untruth is incapable of being
cured by the Effective Date or will prevent or delay the consummation of the
Merger by or beyond May 31, 2000 or if any condition to the Company's obligation
to close under this Agreement shall not have been satisfied by such date;

c) by Genmar and the Merger Subsidiary:

(i) if this Agreement, the Merger and Transactions fail
to receive (x) approval as required under Applicable
Law or (y) the required vote of the stockholders of
the Company necessary to approve this Agreement, the
Merger and the Transactions pursuant to this
Agreement on or before July 15, 1999; or

(ii) in the event of a material breach of this Agreement
by the Company or the stockholders of the Company
that has not been cured, or if any representation or
warranty of the Company or the stockholders of the
Company shall have been knowingly false or shall
become untrue in any material respect, so that such
breach or untruth is incapable of being
substantially cured by the Effective Date or will
prevent or delay consummation of the Merger by or
beyond May 31, 2000; or

(iii) in the event Genmar's lender fails to approve this
Agreement, the Merger or the Transactions upon and
after Genmar exerts reasonable commercial efforts to
obtain such approval; or

(iv) in the event the Partnership or the Company receive
notice (written or otherwise) from the Partnership's
lenders (a) that they will not, individually or
collectively, continue to forebear under the present
forbearance agreement(s) or refuse to extend any
forbearance period, (b) that there will be an
acceleration of collection or a change in the
present payment schedule(s) with respect to any
lender debt or the loan(s), (c) of a default under
any lender debt that cannot reasonably be cured; or
(d) that the terms and conditions of the loan(s), or
the lending relationship, will be revised or
proposed to be revised in any manner detrimental to
the Company, Genmar or the Surviving Corporation; or

(v) in the event that the Management Agreement is
terminated based: (A) on an uncured material breach
by the Company, or (B) pursuant to the provisions
of Section 7 of the Management Agreement, or (C) by

the Company pursuant to a notice of termination that
is not in accordance with the terms of the
Management Agreement; or

(vi) five percent (5%) or more of the shares held by
stockholders of the Company (determined by reference
to the stockholder record date established by the
Company Board of Directors with respect to this
Agreement and the Transactions) properly demand
appraisal rights in accordance with the DBCL and
thereby become Dissenting Shares under this
Agreement, and such Dissenting Shares are not
reduced to below five percent (5%) on or before
August 31, 1999; or

(vii) the conditions to the obligations of Genmar and the
Merger Subsidiary set forth in Section 7.2 are not
satisfied, or shall be deemed to be incapable of
satisfaction, at the Effective Date or May 31, 2000,
whichever is later.

8.2 EFFECT OF TERMINATION. In the event of termination of this
Agreement pursuant to Section 8.1, this Agreement shall forthwith become void,
there shall be no liability on the part of any Party, or their respective
officers and directors, to the other and all rights and obligations of any Party
shall cease; PROVIDED, HOWEVER, that such termination will not relieve any Party
from liability for the breach of any of its representations, warranties,
covenants or agreements set forth in this Agreement.

8.3 EFFECT OF INVESTIGATION. The right of any Party to terminate this
Agreement pursuant to Section 8.1 will remain operative and in full force and
effect regardless of any of investigation made by or on behalf of any party, any
person controlling any such party or any of their respective representatives
whether prior to or after the execution of this Agreement.

ARTICLE IX.

INDEMNIFICATION

9.1 INDEMNIFICATION BY THE COMPANY AND STOCKHOLDERS OF THE COMPANY.
The Company and the stockholders of the Company, jointly, but each of them
severally in accordance with their respective pro-rata interests in the Merger
Consideration, shall indemnify and hold harmless Genmar, Merger Subsidiary and
their officers, directors, representatives, employees and agents against any and
all losses, costs, expenses (including, but not limited to, any and all expenses
reasonably incurred in investigating, preparing or defending against any
litigation commenced or threatened or any claim whatsoever), liabilities,
damages, fines, penalties, charges, assessments, judgements, settlements,
claims, causes of action, proceedings, orders, and other obligations of any
nature (individually "Loss" and collectively "Losses") arising out of or based
upon any false representation or warranty or breach of any covenant or agreement
made by the Company or, with respect to each, the stockholders of the Company by
such stockholder herein or in any certificate, instrument, exhibit or schedule
delivered by the Company, or such stockholder of the Company as

the case may be, in connection with this Agreement, the Merger or
Transactions, subject in any event to the provisions of Section 9.3.

9.2 INDEMNIFICATION BY GENMAR AND MERGER SUBSIDIARY. Genmar and the
Merger Subsidiary, jointly and severely, shall indemnify and hold harmless the
Company and stockholders of the Company against any and all Losses arising out
of or based upon any false representation or warranty or breach of any covenant
or agreement made by Genmar or the Merger Subsidiary herein.

9.3 NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of the Company in this Agreement shall
terminate on and as of the Effective Date, except that the representations
and warranties set forth in Sections 3.1 and 3.2 shall survive the Effective
Date indefinitely. The representations and warranties of the stockholders of
the Company shall terminate as of the Effective Date, except that the
representations and warranties set forth in Sections 4.1 and 4.2 shall
survive the Effective Date indefinitely. The representations and warranties
of Genmar and the Merger Subsidiary shall survive the Effective Date
indefinitely.

9.4 PROCEDURE FOR INDEMNIFICATION. Subject to the rights of offset
in this Agreement, in the event a party intends to seek indemnification
pursuant to the provisions of Section 9.1 or 9.2 hereof (the "INDEMNIFIED
PARTY"), the Indemnified Party shall promptly give notice hereunder to the
other party (the "INDEMNIFYING PARTY") after obtaining written notice of any
claim, investigation, or the service of a summons or other initial or
continuing legal or administrative process or proceeding in any action
instituted against the Indemnified Party as to which recovery or other action
may be sought against the Indemnifying Party because of the indemnification
provided for in Section 9.1 or 9.2 hereof, and, if such indemnity shall arise
from the claim of a third party, the Indemnified Party shall permit the
Indemnifying Party to assume the defense of any such claim and any litigation
resulting from such claim; PROVIDED, HOWEVER, that the Indemnified Party
shall not be required to permit such an assumption of the defense of any
claim or litigation which, if not first paid, discharged or otherwise
complied with, would with substantial certainty result in a material
interruption or disruption of the business of the Indemnified Party, taken as
a whole, or any material part thereof. Notwithstanding the foregoing, the
right to indemnification hereunder shall not be affected by any failure of
the Indemnified Party to give such notice (or by delay by the Indemnified
Party in giving such notice) unless, and then only to the extent that, the
rights and remedies of the Indemnifying Party shall have been prejudiced as a
result of the failure to give, or delay in giving, such notice. Failure by
the Indemnifying Party to notify the Indemnified Party of its election to
defend any such claim or action by a third party within twenty (20) days
after notice thereof shall have been given to the Indemnifying Party shall be
deemed a waiver by the Indemnifying Party of its right to defend such claim
or action.

If the Indemnifying Party assumes the defense of such claim,
investigation or proceeding resulting therefrom, the obligations of the
Indemnifying Party hereunder as to such claim, investigation or proceeding shall
include taking all steps necessary in the defense or settlement of such claim,
investigation or proceeding and holding the Indemnified Party harmless from and
against any and all damages caused by or arising out of any settlement approved
by the Indemnifying Party or any judgment entered in connection with such claim,
investigation or proceeding, except where, and only to the extent that, the
Indemnifying Party has been prejudiced by the actions or omissions of the
Indemnified Party. The Indemnifying Party shall not, in the defense of such
claim or any

proceeding resulting therefrom, consent to entry of any judgment (other than
a judgment of dismissal on the merits without costs) except with the written
consent of the Indemnified Party (which consent shall not be unreasonably
withheld, delayed or conditioned) or enter into any settlement (except with
the written consent of the Indemnified Party)(which consent shall not be
unreasonably withheld, delayed or conditioned) unless (i) there is no finding
or admission of any violation of law and no material effect on any claims
that could reasonably be expected to be made against the Indemnified Party,
(ii) the sole relief provided is monetary damages, and (iii) the settlement
shall include the giving by the claimant or the plaintiff to the Indemnified
Party a release from all liability in respect to such claim or litigation.

If the Indemnifying Party assumes the defense of such claim,
investigation or proceeding resulting therefrom, the Indemnified Party shall
be entitled to participate in the defense of the claim, but solely by
observation and comment to the Indemnifying Party, and the counsel selected
by the Indemnified Party shall not appear on its behalf in any proceeding
arising hereunder. The Indemnified Party shall bear the fees and expenses of
any additional counsel retained by it to participate in its defense unless
either of the following shall apply: (i) the employment of such counsel shall
have been authorized in writing by the Indemnifying Party; or (ii) the
Indemnifying Party's legal counsel shall advise the Indemnifying Party in
writing, with a copy to the Indemnified Party, that there is a conflict of
interest that would make it inappropriate under applicable standards of
professional conduct to have common counsel. If clause (i) or (ii) in the
immediately preceding sentence is applicable, then the Indemnified Party may
employ separate counsel at the expense of the Indemnifying Party to represent
the Indemnified Party, but in no event shall the Indemnifying Party be
obligated to pay the costs and expenses of more than one such separate
counsel for any one complaint, claim, action or proceeding in any one
jurisdiction.

If the Indemnifying Party does not assume the defense of any such
claim by a third party or litigation resulting therefrom after receipt of
notice from the Indemnified Party, the Indemnified Party may defend against
such claim or litigation in such manner as it reasonably deems appropriate,
and unless the Indemnifying Party shall deposit with the Indemnified Party a
sum equivalent to the total amount demanded in such claim or litigation plus
the Indemnified Party's estimate of the cost (including attorneys' fees) of
defending the same, the Indemnified Party may settle such claim or proceeding
on such terms as it may reasonably deem appropriate and the Indemnifying
Party shall promptly reimburse the Indemnified Party for the amount of such
settlement and for all costs (including attorneys' fees), expenses and
damages incurred by the Indemnified Party in connection with the defense
against or settlement of such claim, investigation or litigation, or if any
such claim or litigation is not so settled, the Indemnifying Party shall
promptly reimburse the Indemnified Party for the amount of any judgment
rendered with respect to any claim by a third party in such litigation and
for all costs (including attorneys' fees), expenses and damage incurred by
the Indemnified Party in connection with the defense against such claim or
litigation, whether or not resulting from, arising out of, or incurred with
respect to, the act of a third party.

Each party shall cooperate in good faith and in all respects with each
Indemnifying Party and its representatives (including without limitation its
counsel) in the investigation, negotiation, settlement, trial and/or defense of
any proceedings (and any appeal arising therefrom) or any claim. The parties
shall cooperate with the other in any notifications to and information requests
of any insurers.

ARTICLE X.

DEFINITIONS

As used in this Agreement, unless the context otherwise requires, the
following terms (or any variant in the form thereof) shall have the following
respective meanings. Terms defined in the singular will have a comparable
meaning when used in the plural and vice versa, and the reference to any gender
will be deemed to include all genders. Any reference to any statutory or
regulatory provision will be deemed to be a reference to any successor statutory
or regulatory provision. Unless otherwise defined or the context otherwise
clearly requires, terms for which meanings are provided in this Agreement will
have such meaning when used in each Collateral Document, notice, certificate,
communication, opinion or other document executed or required to be executed
pursuant hereto or thereto or otherwise delivered, from time to time, pursuant
hereto or thereto.

"Act" shall have the meaning set forth in Section 1.3(a) of this Agreement.

"Affiliate" means, with respect to any Person, (a) any other Person at the
time directly or indirectly controlling, controlled by or under direct or
indirect common control with such Person, (b) any other Person of which such
Person at the time owns, or has the right to acquire, directly or indirectly,
twenty percent (20%) or more of any class of capital stock or beneficial
interest, (c) any other Person which at the time owns, or has the right to
acquire, directly or indirectly, twenty percent (20%) or more of any class of
the capital stock or beneficial interest of such Person, (d) any executive
officer or director or such Person, (e) with respect to any partnership,
joint venture or similar entity, any general partner thereof, and (f) when
used with respect to an individual, will include any member of such
individual's immediate family or a family trust.

"Agreement" shall have the meaning set forth in the preamble to this Agreement
and Plan of Reorganization.

"Applicable Law" means any Law of any Authority, whether domestic or foreign,
including without limitation all federal and state securities laws and
environmental laws, to or by which a Person or any of its business or operations
is subject or any of its property or assets is bound.

"Authority" means any governmental or quasi-governmental authority, whether
administrative, executive, judicial, legislative or other, or any combination
thereof, including without limitation any federal, state, territorial, county,
municipal or other government or governmental or quasi-governmental agency,
arbitrator, authority, board, body, branch, bureau, central bank or comparable
agency or entity, commission, corporation, court, department, instrumentality,
master, mediator, panel, referee, system or other political unit or subdivision
or any other entity of any of the foregoing, whether domestic or foreign.

"Closing Date" shall have the meaning set forth in Section 1.3(c) of this
Agreement.

"COBRA" shall have the meaning set forth in Section 3.17(a) of this Agreement.

"Code" shall have the meaning set forth in Section 2.3 of this Agreement.

"Collateral Document" means any agreement, instrument, certificate, opinion,
memorandum, schedule or other document delivered by a Party or a Stockholder or
a stockholder of the Company pursuant to this Agreement or in connection with
the Merger and the Transactions. For purposes of the representations,
warranties, covenants and agreements of the Company and the Stockholders of the
Company, on the one hand, or Genmar and the Merger Subsidiary on the other,
under this Agreement and with respect to opinions to be delivered to this
Agreement, except to the extent of a Party's actual knowledge, the Company and
the Stockholders of the Company, Genmar and the Merger Subsidiary, as the case
may be, assume no responsibility for the authority of or genuineness of
signatures relating to the others as counterparts or their representations,
warranties, covenants and agreements.

"Common Stock" shall have the meaning set forth in Section 3.5 of this
Agreement.

"Company" shall have the meaning set forth in the preamble to this Agreement.

"Company Common Stock" means all shares of the common stock of the Company, par
value $.0001 per share, that are (i) issued and outstanding on the "record date"
established pursuant to Section 1.2(a), or (ii) issued and outstanding
immediately prior to or on the Effective Date, as the context of the usage
within this Agreement dictates.

"Competing Business" shall have the meaning set forth in Section 3.20 of this
Agreement.

"Computer Systems" shall have the meaning set forth in Section 3.18 of this
Agreement.

"Contract" or "Contractual Obligation" means any term, condition, provision,
representation, warranty, agreement, covenant, undertaking, commitment,
indemnity or other obligations set forth in the Organizational Documents of the
obligee or which is outstanding or existing under any instrument, contract,
lease or other contractual undertaking (including without limitation any
instrument relating to or evidencing any indebtedness) to which the obligee is a
party or by which it or any of its business is subject or property or assets is
bound.

"Defaulting Party" shall have the meaning set forth in Section 11.2 of this
Agreement.

"Dissenting Shares" shall have the meaning set forth in Section 2.1(c) of this
Agreement.

"Dissenter's Rights" means exercising the right(s) of appraisal under the DBCL.

"DBCL" shall have the meaning set forth in the Recitals to this Agreement.

"Effective Date" shall have the meaning set forth in Section 1.1 of this
Agreement.

"Encumbrance" shall have the meaning set forth in Section 3.4 of this Agreement.

"Environmental and Safety Requirements" shall have the meaning set forth in
Section 3.12(a) of this Agreement.

"ERISA" shall have the meaning set forth in Section 3.17 of this Agreement.

"Financial Information" shall have the meaning set forth in Section 3.6 of This
Agreement.

"Funding Default" shall have the meaning set forth in Section 6.10 of this
Agreement.

"GAAP" shall have the meaning set forth in Section 3.6 of this Agreement.

"Genmar" shall have the meaning set forth in the preamble to this Agreement.

"Genmar Common Stock" means the common stock of Genmar, par value $ .01 per
share, issued by Genmar in exchange for Company Common Stock pursuant to the
Merger.

"Genmar Public Shares" shall have the meaning set forth in Section 2.1 of this
Agreement.

"Governmental Entity" shall have the meaning set forth in Section 3.3 of this
Agreement.

"Indemnified Party" and "Indemnifying Party" shall each have the meaning set
forth in Section 9.4 hereof.

"Intellectual Property" shall have the meaning set forth in Section 3.9 of this
Agreement.

"Knowledge." For purposes of this Agreement, an individual will be deemed to
have "Knowledge" of a particular fact or other matter if: (a) such
individual is actually aware of such fact or other matter; or (b) a prudent
individual should reasonably be expected to discover or otherwise become
aware of such fact or other matter in the course of conducting business in
the ordinary course. An entity will be deemed to have "Knowledge" of a
particular fact or other matter if any individual who is serving, or who has
at any time served, as director, officer, general partner, management or
supervisory employee or trustee of such entity (or in any similar capacity)
has, or at any time had, Knowledge of such fact or other matter.

"Law" means any (a) administrative, judicial, legislative or other action,
code, consent decree, constitution, decree, directive, enactment, finding,
guideline, law, injunction, interpretation, judgement, order, ordinance,
policy statement, proclamation, promulgation, regulation, requirements, rule,
rule of law, rule of public policy, settlement agreement, statute, or writ of
any Authority, domestic or foreign; (b) the common law, or other legal or
quasi-legal precedence; or (c) arbitrator's, mediator's or referee's award,
decision, finding or recommendation, including without limitation, in each
such case or instance, any interpretation, directive, guideline or request,
whether or not having the force of law including, in all cases, any
particular section, part or provisions thereof.

"Loss" or "Losses" shall have the meaning set forth in Section 9.1 of this
Agreement.

"Management Agreement" shall have the meaning set forth in Section 6.4 of this
Agreement.

"Merger" shall have the meaning set forth in the Recitals to this Agreement.

"Merger Closing" shall have the meaning set forth in Section 1.3 of this
Agreement.

"Merger Consideration" shall have the meaning set forth in Section 2.1(d) of
this Agreement.

"Merger Subsidiary" shall have the meaning set forth in the preamble to this
Agreement.

"Non-Defaulting Party" shall have the meaning set forth in Section 11.2 of this
Agreement.

"Note" or "Notes" shall have the meaning set forth in Section 2.1 of this
Agreement.

"Note Merger Consideration" shall have the meaning set forth in Section 2.1(b)
of this Agreement.

"Options" means all rights, options (excluding warrants), all calls or
commitments evidencing the right to subscribe for, purchase or otherwise
acquire Company Common Stock, whether or not the right to subscribe for,
purchase or otherwise acquire, is immediately exercisable or is conditioned
upon the passage of time, the occurrence or nonoccurrence of the existence or
nonexistence of some other event.

"Organizational Documents" means, with respect to a Person, which is a
corporation, its charter, its by-laws, and all voting trusts and similar
arrangements applicable to any of its capital stock, and, with respect to a
Person that is a Partnership, its agreement and certificate of partnership,
any agreement among partners, and any management and similar agreements
between the partnership and any general partners (or any Affiliate thereof).

"Other Transaction" shall have the meaning set forth in Section 6.5 of this
Agreement.

"Partnership" means Pyramid Composites Manufacturing Limited Partnership, a
limited partnership organized and existing under the laws of the Commonwealth of
Pennsylvania.

"Party" or "Parties" means any Person that is named as a party or who is a
signatory to this Agreement; PROVIDED, HOWEVER, that each stockholder of the
Company shall be deemed a Party to this Agreement and the Transactions upon the
adoption and approval of this Agreement in accordance with Section 1.2 hereof.

"Person" means any natural individual or any entity, which shall include any
corporation, firm, unincorporated organization, association, partnership,
limited liability company, trust (intro vivos or testamentary), estate of a
deceased, insane or incompetent individual, business trust, joint stock company,
joint venture or other organization, entity or business, whether acting in an
individual, fiduciary or other capacity, or any Authority.

"Personal Property" shall have the meaning set forth in Section 3.13 of this
Agreement.

"Plan" shall have the meaning set forth in Section 3.17(a) of this Agreement.

"Public Offering" (i) shall have the meaning set forth in Section 1.3(a), or
(ii) means the offering of the Common Stock of Genmar pursuant to the
Underwriting Agreement pursuant to which Genmar

will issue and sell such stock in a firm commitment public offering pursuant
to the Registration Statement in accordance with the requirements of the Act,
as the context of usage in this Agreement dictates.

"Public Offering Closing Date" shall have the meaning set forth in Section
1.3(a) of this Agreement.

"Public Offering Price" shall have the meaning set forth in Section 2.1(a)(i) of
this Agreement.

"Real Property" shall have the meaning set forth in Section 3.7 of this
Agreement.

"Registration Statement" means the registration statement (including the
prospectus, exhibits, financial statements and schedules included therein,
and all amendment thereof, including post-effective amendments and any
registration statement filed under Rule 462(b) with respect to the Public
Offering), filed under the Act registering the shares of Genmar to be sold in
the Public Offering in accordance with the terms and conditions of the
Underwriting Agreement.

"Related Persons" shall have the meaning set forth in Section 3.20 of this
Agreement.

"SEC" means the United States Securities and Exchange Commission.

"Secondary Closing Date" shall have the meaning set forth in Section 1.3(b) of
this Agreement.

"Special Meeting" shall have the meaning set forth in Section 1.2(a)(i) of this
Agreement.

"Stock Merger Consideration" shall have the meaning set forth in Section 2.1(a)
of this Agreement.

"Stockholders" shall refer to and mean the stockholders of the Company set forth
on the execution page hereof who join in this Agreement by execution of this
Agreement specifically to covenant as to certain matters as set forth herein.

"Stockholders Agreement" shall have the meaning set forth in Section 1.9 of this
Agreement.

"Surviving Corporation" shall have the meaning set forth in Section 1.1 of this
Agreement.

"Tax" shall have the meaning set forth in Section 3.14 of this Agreement.

"Tax Liability" shall have the meaning set forth in Section 3.14 of this
Agreement.

"Transactions" means the other transactions contemplated by this Agreement or
the Merger by any Collateral Document executed or required to be executed in
connection herewith or therewith.

"Underwriter" means the lead underwriters and any other Person who executes the
Underwriting Agreement as an underwriter of Genmar Common Stock in the Public
Offering.

"Underwriting Agreement" means the firm commitment underwriting agreement
between Genmar and the Underwriter to be filed as an exhibit to the
Registration Statement and to be executed on or about the commencement of the
Public Offering.

"Warrants" means all rights related to warrants issued by the Company to
purchase or otherwise acquire Company Common Shares, whether or not the right
to subscribe for, purchase or otherwise acquire is immediately exercisable or
is conditioned upon the passage of time, the occurrence or nonoccurrence or
the existence or nonexistence of some other event.

"Year 2000 Compatible" shall have the meaning set forth in Section 3.18 of this
Agreement.

ARTICLE XI.

MISCELLANEOUS AND GENERAL

11.1 NOTICES. All notices, demands and other communications
provided for hereunder shall be in writing and shall be given by either
personal delivery, via facsimile transmission (receipt telephonically
confirmed), by nationally recognized overnight courier (prepaid), or by
certified or registered first class mail, postage prepaid, return receipt
requested, sent to each Party, at its address as set forth below or at such
other address or in such other manner as may be designated by such party in a
written notice to each of the other parties. All such notices, demands and
communications shall be effective when personally delivered, one (1) business
day after delivery to the overnight courier, upon telephone confirmation of
facsimile transmission or upon receipt after dispatch by mail to the party to
whom the same is so given or made:

If to Company and the
Stockholders: Pyramid Operating Systems, Inc.
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Attention: Board of Directors

with copy to: Gefsky and Xxxxxx, P.C.
Xxx XXX Xxxxx
Xxxxx 0000
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: H. Xxxxxx Xxxxxx, Esq.

If to Genmar: Genmar Holdings, Inc.
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxxx, XX
Xxxx X. XxXxxxxxx, Esq.

with copy to: Xxxxxx and Xxxxxx P.A.
2400 IDS Center
00 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.

11.2 LEGAL AND OTHER COSTS.

a) In the event that any party defaults (the "Defaulting
Party") in his or its obligations under this Agreement (which shall
specifically exclude a Funding Default under Section 6.10(ii)) and, as a
result thereof, the other party (the "Non-Defaulting Party") seeks to legally
enforce his or its rights hereunder against the Defaulting Party, then, in
addition to all damages and other remedies to which the Non-Defaulting Party
is entitled by reason of such default, the Defaulting Party shall promptly
pay to the Non-Defaulting Party an amount equal to all costs and expenses
(including reasonable attorneys' fees) paid or incurred by the Non-Defaulting
Party in connection with such enforcement.

b) In the event that the Non-Defaulting Party is entitled
to receive an amount of money by reason of the Defaulting Party's default
hereunder, then, in addition to such amount of money, the Defaulting Party
shall promptly pay to the Non-Defaulting Party a sum equal to interest on
such amount of money accruing at the rate of 2% per month (but if such rate
is not permitted under the laws of the State of Delaware, then at the highest
rate which is permitted to be paid under the laws of the State of Delaware)
during the period between the date such payment should have been made
hereunder and the date of the actual payment thereof.

11.3 ENTIRE AGREEMENT. This writing constitutes the entire
agreement of the Parties with respect to the subject matter hereof and may
not be modified or amended except pursuant to Section 11.8 hereof.

11.4 GOVERNING LAW. This Agreement, including all the documents,
instruments and agreements to be executed and/or delivered by the parties
hereto, shall be construed, governed by and enforced in accordance with the
internal laws of the State of Delaware, without giving effect to the
principles of comity or principles of conflicts of laws thereof.

11.5 BINDING EFFECT. This Agreement shall be binding upon and inure
to the benefit of each corporate party hereto, its successors and assigns,
and each individual party hereto and his heirs, personal representatives,
successors and assigns.

11.6 COOPERATION. Each Party hereto shall cooperate, shall take
such further action and shall execute and deliver such further documents as
may be reasonably requested by any other Party in order to carry out the
provisions and purposes of this Agreement.

11.7 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
taken together shall be deemed one and the same original.

11.8 AMENDMENTS. No purported amendment, modification or waiver of
any provision of this Agreement, or any of the documents, instruments or
agreements to be executed by the Parties pursuant hereto shall be effective
unless in a writing specifically referring to this Agreement and signed by
all of the Parties and all amendments thereof shall be governed by and
construed in accordance with the law of the State of Delaware applicable to
Contracts made and to be performed therein; notwithstanding the foregoing,
any amendment, modification or waiver of any provision of this Agreement that
does not directly affect a stockholder's liability for indemnification
hereunder may be amended, modified or waived by the Parties to this Agreement
without the signatures of the stockholders of the Company, including the
Stockholders, and shall be effective and binding on all Parties and the
stockholders of the Company.

11.9 PRESERVATION OF AND ACCESS TO RECORDS. The Surviving
Corporation shall preserve all books and records of the Company for a period
of six (6) years after the Closing Date; PROVIDED, HOWEVER, the Surviving
Corporation may destroy any part or parts of such records upon obtaining
written consent of Company for such destruction, which consent shall not be
unreasonably withheld. Such records shall be made available to Company and
their representatives at all reasonable times during normal business hours of
the Company during said six-year period with the right at their expense to
make abstracts from and copies thereof.

11.10 PUBLIC ANNOUNCEMENTS. The timing and content of all public
announcements relating to the execution of this Agreement and the
consummation of the transactions contemplated hereby shall be approved by
both the Company and Genmar prior to the release of such public
announcements, and each Party agrees to cooperate with the other party as
appropriate to comply with all Applicable Laws. Subsequent to the date of
receipt of all consents and approvals of each Governmental Entity necessary
to consummate this transaction, Genmar may make such announcements and/or
advertisements as Genmar, in its sole discretion, deems necessary.

11.11 COSTS. Except as otherwise provided in this Agreement, Genmar
and the Company shall pay their own costs and expenses incurred in connection
with negotiating and preparing this Agreement and consummating the
transactions contemplated hereby, including but not limited to fees and
disbursements of their attorneys, accountants and investment bankers. Except
as otherwise provided in this Agreement, any costs or expenses incurred on
behalf of the stockholders of the Company (other than Genmar) for the
services of Gefsky and Xxxxxx, P.C., Xxxxx and Xxxxxxx, P.C. (not to exceed
$10,000) and Cornerstone Capital Advisors, Ltd. in their representation of
the Company shall be considered costs and expenses of the Company.

11.12 HEADINGS. The headings of the articles, sections and
subsections of this Agreement are intended for the convenience of the parties
only and shall in no way be held to explain, modify, construe, limit, amplify
or aid in the interpretation of the provisions hereof. The terms "this
Agreement," "hereof," "herein," "hereunder," "hereto" and similar expressions
refer to this Agreement as a whole and not to any particular article,
section, subsection or other portion hereof and include the schedules and
exhibits hereto and any document, instrument or agreement executed and/or
delivered by the parties pursuant hereto.

11.13 SCOPE OF AGREEMENT. Unless the context otherwise requires, all
references in this Agreement or in any schedule or Exhibit hereto, to the
assets, properties, operations, business, financial statements, employees,
books and records, accounts receivable, accounts payable, Contracts or other
attributes of the business of the Company shall mean such items or attributes
as they are used in, apply to, or relate to all businesses of the Company.

11.14 NUMBER AND GENDER. Unless the context otherwise requires,
words importing the singular number shall include the plural and vice versa
and words importing the use of any gender shall include all genders.

11.15 SEVERABILITY. In the event that any provision of this
Agreement is declared or held by any court of competent jurisdiction to be
invalid or unenforceable, such provision shall be severable from, and such
invalidity or unenforceability shall not be construed to have any effect on,
the remaining provisions of this Agreement, unless such invalid or
unenforceable provision goes to the essence of this Agreement, in which case
the entire Agreement may be declared invalid and not binding upon any of the
parties.

11.16 PARTIES IN INTEREST AND ASSIGNMENT. Nothing expressed or
implied in this Agreement is intended or shall be construed to confer any
rights or remedies under or by reason of this Agreement upon any Person other
than (i) Genmar, Affiliates and Genmar's lenders under the senior and
subordinated credit facilities of Genmar, (ii) the Company, and (iii) the
stockholders of the Company, and their permitted successors and assigns.
This Agreement and any rights or interests arising from or in connection with
this Agreement shall (i) not be assignable by the Company or the stockholders
of the Company and any such purported assignment shall be null and void and
of no force or effect, (ii) be assignable by Genmar and/or the Merger
Subsidiary in their sole discretion, including any assignment to Genmar's
lenders under the senior and subordinated credit facilities of Genmar.

11.17 WAIVER. The terms, conditions, warranties, representations and
indemnities contained in this Agreement, including the documents, instruments
and agreements executed and/or delivered by the Parties pursuant hereto, may
be waived only by a written instrument executed by the Party waiving
compliance. Any such waiver shall only be effective in the specific instance
and for the specific purpose for which it was given and shall not be deemed a
waiver of any other provision hereof or of the same breach or default upon
any recurrence thereof. No failure on the part of a Party hereto to exercise
and no delay in exercising any right hereunder shall operate as a waiver
thereof nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right.

11.18 CONSTRUCTION. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the Parties and no presumption or burden
of proof shall arise favoring or disfavoring any Party by virtue of the
authorship of any of the provisions of this Agreement. The word "including"
shall mean including without limitation. The Parties intend that each
representation, warranty and covenant contained herein shall have independent
significance. If any Party has breached any representation, warranty or
covenant contained herein in any respect, the fact that there exists another
representation, warranty or covenant relating to the

same subject matter (regardless of the relative levels of specificity) which
the Party has not breached shall not detract from or mitigate the fact that
the Party is in breach of the first representation, warranty or covenant.

11.19 FACSIMILE SIGNATURES. Due to the Parties' geographic
locations, the Parties hereto have agreed that signatures for execution of
this Agreement and any certificate, instrument and other document entered
into and/or delivered pursuant to or in connection with this Agreement, may
be provided by facsimile; and upon receipt of such facsimile signature, the
Party accepting such signature shall be entitled to rely on the execution
thereof and such signature will be binding and effective as if the original
counterpart had been transmitted and/or delivered.

[SIGNATURE PAGES TO FOLLOW]

SIGNATURE PAGE COUNTERPART SUMMARY
FOR
PLAN AND AGREEMENT OF REORGANIZATION

THE FOLLOWING IS A SUMMARY OF THE COUNTERPART SIGNATURE PAGES TO THE
MERGER AGREEMENT WHICH WERE EXECUTED AND DELIVERED ON JUNE 18, 1999, SET
FORTH IN ORDER AS FOLLOWS:

GENMAR HOLDINGS, INC.

POS ACQUISITION CORPORATION

PYRAMID OPERATING SYSTEMS, INC.

XXXX XXXXXX, XX

PYRAMID COMPOSITES MANUFACTURING LIMITED PARTNERSHIP

PYRAMID COMPOSITES MANUFACTURING, INC.

AWATTO LIMITED PARTNERSHIP

XXXX X. XXXXXX

XXXX X. XXXX

XXXXXX X. XXXXXXXXX, XX.

XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE TRUST FBO XXXX XXXXXX XXXXXXXXX

XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE TRUST FBO XXXX XXXXX XXXXXXXXX

XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE TRUST FBO XXXX XXXXXX XXXXXXXXX

XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE TRUST FBO XXXX XXXXX XXXXXXXXX

XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE TRUST FBO XXXXXXX XXXXXX XXXXXXXXX

XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE TRUST FBO XXX XXXXX XXXXXX

XXXXXXX X. XXXXXXXXXX REVOCABLE TRUST

SANRAY CORPORATION

XXXX AND XXX XXXXXX IRREVOCABLE TRUST FBO XXXXXXXXX X. XXXXXX

XXXX AND XXX XXXXXX IRREVOCABLE TRUST FBO XXXXXXX X. XXXXXX

GEFSKY AND XXXXXX INVESTMENT PARTNERSHIP III

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written. By adoption of this
Agreement, the stockholders of the Company, as set forth on EXHIBIT F hereto,
have approved the terms and conditions of this Agreement.

GENMAR HOLDINGS, INC.

By /s/ Xxxxx X. Xxxxxxxx XX
---------------------------------
Its EVP & CFO
------------------------------

POS ACQUISITION CORPORATION

By /s/ [ILLEGIBLE]
---------------------------------
Its VP
------------------------------

PYRAMID OPERATING SYSTEMS, INC.

By /s/ [ILLEGIBLE]
---------------------------------
Its
------------------------------

STOCKHOLDERS: STOCKHOLDERS:

/s/ Xxxx Xxxxxx, XX
PYRAMID COMPOSITES MANUFACTURING -----------------------------------
LIMITED PARTNERSHIP Xxxx Xxxxxx, XX
By: Pyramid Composites Manufacturing, Inc.
/s/ Xxxx X. Xxxxxx
-----------------------------------
Xxxx X. Xxxxxx
By /s/ [ILLEGIBLE]
----------------------------------- /s/ Xxxx X. Xxxx
Its----------------------------- -----------------------------------
Xxxx X. Xxxx

PYRAMID COMPOSITES MANUFACTURING, INC.
/s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
Xxxxxx X. Xxxxxxxxx, Xx. (Personally)
By /s/ [ILLEGIBLE]
------------------------------------
Its
------------------------------

AWATTO LIMITED PARTNERSHIP XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE
TRUST FBO XXXX XXXXXX XXXXXXXXX
By: /s/ [ILLEGIBLE]
-----------------------------------
Its /s/ [ILLEGIBLE]
--------------------------------
By /s/ [ILLEGIBLE] By /s/ Xxxxxx X. Xxxxxxxxx
------------------------------ ---------------------------------
Its /s/ [ILLEGIBLE] Its Trustee
--------------------------- ------------------------------

[CONTINUED ON NEXT PAGE]

[SIGNATURE PAGE CONTINUED]

XXXXXXX X. XXXXXXXXXX REVOCABLE TRUST XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE
TRUST FBO XXXX XXXXX XXXXXXXXX

By: /s/ Xxxxxxx X. Xxxxxxxxxx By /s/ Xxxxxx X. Xxxxxxxxx
----------------------------------- ---------------------------------
Its Trustee Its Trustee
-------------------------------- ------------------------------

SANRAY CORPORATION XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE
TRUST FBO XXXX XXXXXX XXXXXXXXX
By: /s/ Xxxxxxx X. Xxxxxxxxxx
-----------------------------------
Its President By /s/ Xxxxxx X. Xxxxxxxxx
-------------------------------- ---------------------------------
Its Trustee
------------------------------

XXXX AND XXX XXXXXX IRREVOCABLE TRUST XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE
FBO XXXXXXXXX X. XXXXXX TRUST FBO XXXX XXXXX XXXXXXXXX

By /s/ Xxxx X. Xxxxxx By /s/ Xxxxxx X. Xxxxxxxxx
--------------------------------- ---------------------------------
Its G.P. Its Trustee
--------------------------------- ------------------------------

XXXX AND XXX XXXXXX IRREVOCABLE TRUST
FBO XXXXXXXXX X. XXXXXX XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE
TRUST FBO XXXXXXX XXXXXX XXXXXXXXX
By /s/ Xxxx X. Xxxxxx
--------------------------------- By /s/ Xxxxxx X. Xxxxxxxxx
Its G.P. ---------------------------------
--------------------------- Its Trustee
---------------------------
XXXX AND XXX XXXXXX IRREVOCABLE TRUST
FBO XXXXXXX X. XXXXXX
XXXXXX X. XXXXXXXXX, XX. IRREVOCABLE
By /s/ Xxxx X. Xxxxxx TRUST FBO XXX XXXXX XXXXXX
------------------------------------
Its G.P. By /s/ Xxxxxx X. Xxxxxxxxx
------------------------------ ---------------------------------
Its Trustee
---------------------------
GEFSKY AND XXXXXX INVESTMENT
PARTNERSHIP III

By /s/ [ILLEGIBLE]
------------------------------------
Its Managing Partner
------------------------------

[CONTINUED ON NEXT PAGE]

[SIGNATURE PAGE CONTINUED]

STOCKHOLDERS:

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

EXHIBIT A

REORGANIZATION AGREEMENT

EXHIBIT A

CERTIFICATE OF MERGER

PYRAMID OPERATING SYSTEMS, INC.

(A DELAWARE CORPORATION)

WITH AND INTO

POS ACQUISITION CORPORATION

(A DELAWARE CORPORATION)

The undersigned corporations organized and existing under and by virtue
of the General Corporation Law of Delaware,

DOES HEREBY CERTIFY:

FIRST: That the name and state of incorporation of each of the
constituent corporations (the "Constituent Corporations") of the merger is as
follows:

NAME STATE OF INCORPORATION

Pyramid Operating Systems, Inc. Delaware

POS Acquisition Corporation Delaware

SECOND: That an agreement of merger between the parties to the merger
has been approved, adopted, certified, executed and acknowledged by each of the
constituent corporations in accordance with the requirements of section 251 of
the General Corporation Law of Delaware.

THIRD: That the name of the surviving corporation of the merger is POS
ACQUISITION CORPORATION (the "Surviving Corporation").

FOURTH: That the Certificate of Incorporation of POS ACQUISITION
CORPORATION, a Delaware corporation, which will survive the merger, shall be the
Certificate of Incorporation of the Surviving Corporation.

A-1

FIFTH: That the executed agreement of merger is on file at an office of
the Surviving Corporation, the address of which is Pyramid Operating Systems,
Inc., x/x Xxxxxx Holdings, Inc., 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxxxxx, Xxxxxxxxx 00000.

SIXTH: That a copy of the agreement of merger will be furnished by the
Surviving Corporation, on request and without cost, to any stockholder of either
Constituent Corporation.

SEVENTH: That this Certificate of Merger shall be effective on

---------------.

POS ACQUISITION CORPORATION

Dated: By:
-------------------------------- ---------------------------------
Its:
-----------------------------

PYRAMID OPERATING SYSTEMS, INC.

Dated: By:
-------------------------------- ---------------------------------
Its:
-----------------------------

A-2

EXHIBIT B

REORGANIZATION AGREEMENT

EXHIBIT B

CERTIFICATE OF INCORPORATION
OF
POS ACQUISITION CORPORATION

THE UNDERSIGNED, being a natural person for the purpose of organizing a
corporation under the General Corporation Law of the State of Delaware, hereby
certifies that:

FIRST: The name of the corporation is POS Acquisition Corporation
(the "Corporation").

SECOND: The address of the registered office of the Corporation
in the State of Delaware is c/o CT Corporation System, 0000 Xxxxxx Xxxxxx,
Xxxx xx Xxxxxxxxxx, Xxxxxx of New Castle, State of Delaware. The registered
agent of the Corporation in the State of Delaware at such address is CT
Corporation System.

THIRD: The purpose of the Corporation is to engage in any
lawful act or activity for which corporations may be organized under the
General Corporation Law of the State of Delaware, as from time to time
amended (the "DGCL").

FOURTH: The total number of shares of capital stock which the
Corporation shall have authority to issue is 10,000, all of which shares shall
be common stock having a par value of $0.01 per share.

FIFTH: The name and mailing address of the incorporator is
Xxxxxxx X. Xxxxxx, Xxxxxx and Xxxxxx, P.A., 2400 IDS Center, 00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000.

SIXTH: In furtherance and not in limitation of the powers
conferred by law, the Bylaws of the Corporation may be adopted, amended or
repealed by the Board of Directors of the Corporation; PROVIDED, HOWEVER,
that, any Bylaws adopted by the Board of Directors may be amended or repealed
by the shareholders entitled to vote thereon.

SEVENTH: Election of member of the Board of Directors need not be by
written ballot.

EIGHTH: The Corporation shall indemnify, to the full extent
permitted by Section 145 of the DGCL, all persons whom it may indemnify pursuant
thereto.

NINTH: No director shall be personally liable to the
Corporation or to any stockholder for monetary damages for breach of
fiduciary duty as a director, except for any matter in respect of which such
director shall be liable under Section 174 of the DGCL or shall be liable by
reason that, in addition to any and all other requirements for such
liability, such director (i) shall have breached his or her duty of loyalty
to the Corporation or its stockholders, (ii) shall not have acted in good
faith or, in failing to act, shall not have acted in good faith, (iii) shall
have acted in a manner involving intentional misconduct or a knowing
violation of law or (iv) shall have derived an improper personal

B-1

benefit. Neither the amendment nor repeal of this Article nor the adoption
of any provision of the Certificate of Incorporation inconsistent with this
Article, shall eliminate or reduce the effect of this Article in respect of
any matter occurring, or any cause of action, suit or claim that, but for
this Article, would accrue or arise, prior to such amendment, repeal or
adoption of an inconsistent provision.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of
Incorporation as of the _____ day of June, 1999.

----------------------
Xxxxxxx X. Xxxxxx
Sole Incorporator

B-2

EXHIBIT C

REORGANIZATION AGREEMENT

EXHIBIT C

THIS DEBENTURE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
"ACT") OR ANY STATE SECURITIES LAW. THIS DEBENTURE MAY NOT BE TRANSFERRED OR
SOLD OR OFFERED FOR TRANSFER OR SALE OR OTHERWISE DISTRIBUTED EXCEPT (1) IN
CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND SUCH
STATE LAWS, OR (2) PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION.

GENMAR HOLDINGS, INC.
NON-NEGOTIABLE, UNSECURED SUBORDINATED DEBENTURE ("DEBENTURE")

REGISTERED SHARES: _______________________

ORIGINAL ISSUE DATE: June __, 1999

MATURITY DATE: [__________]
INTEREST RATE: [___] interest to be paid semi-annually

Genmar Holdings, Inc., a Delaware corporation (the "Issuer"), for value
received, hereby promises to pay to the registered owner specified above on the
maturity date specified above, unless this Debenture shall have been previously
prepaid in whole or in part, upon surrender hereof, the principal amount
advanced hereunder and interest thereon from the original issue date specified
above (the "Original Issue Date") until payment of said principal amount has
been made in full with simple interest accruing and paid semi- annually at the
annual rate of [___%]. All principal and interest payments on this Debenture
shall be payable by check mailed to the registered owner of this Debenture at
such owner's address as it appears on the face of this Debenture or as shall be
provided in writing by the owner hereof to the Issuer. All amounts payable with
respect to this Debenture shall be paid in currency of the United States of
America. Interest on the unpaid principal amount of this Debenture shall be paid
semi-annually on or before the last day of June and December of each year during
which this Debenture remains unpaid. The principal and any unpaid interest
payable pursuant to this Debenture is payable in arrears on the Maturity Date.

SUBORDINATION

This Debenture is subordinated to all indebtedness of Issuer and
guarantees by Issuer, including without limitation such indebtedness and
guarantees in favor of (i) Issuer's affiliates, including its officers,
directors and affiliated companies, and (ii) lenders and the Bank of New York,
or any successor lender, pursuant to one or more credit agreements with such
lenders and the Bank of New York, as agent, including each such agreement, as
amended or refinanced from time to time,

C-1

it being understood and agreed that pursuant to such subordination no payment
shall be made on this Non-Negotiable, Unsecured Senior Subordinated Debenture
at any time that a default or event of default shall have occurred and be
continuing under any such credit agreement.

The indebtedness evidenced by this Debenture shall be senior in right of
payment to all short term debt (but not the current portion of long term
indebtedness) and accounts payable and accrued expenses of the Issuer.

OPTIONAL PREPAYMENT

At any time prior to the Maturity Date and so long as no Default exists,
and assuming the Issuer obtains all necessary consents from its lenders, the
Issuer may, at its sole election, prepay without premium or penalty, all of the
outstanding principal balance of this Debenture together with accrued interest.

DEFAULT

Each of the following events or circumstances shall constitute an event
of Default, upon written notice from the Holder to the Issuer:

(i) The non-payment, when and as due, of any interest or principal
with respect to this Debenture; and

(ii) The institution of a proceeding, which remains undismissed and
unstayed for a period in excess of thirty (30) days, seeking to have an order
for relief entered against the Issuer entailing a finding of insolvency or a
similar declaration, seeking similar relief under any law relating to
bankruptcy, insolvency, relief of debtors or protection from creditors or
seeking appointment of a receiver, trustee, custodian, liquidator or other
similar official for all or any substantial part of the Issuer's property.

REMEDIES

In the event a Default occurs, subject to the subordination provisions
herein, the holder of this Debenture shall have the right to demand payment of
the principal amount and accrued interest of this Debenture, plus recovery of
all costs and expenses, including reasonable legal fees incurred in pursuing
collection of any unpaid amounts due pursuant to this Debenture or in pursuing
any other rights of the Holder as well as any other rights afforded by law,
including without limitation specific performance.

ASSIGNMENT

This Debenture and any interest herein shall be non-negotiable,
non-assignable and non-transferable (except to Issuer or POS Acquisition
Corporation, or by the laws of descent and distribution). Any purported
negotiation, assignment or transfer of this Debenture, or any interest herein
shall be null, void and of no force or effect.

C-2

IN WITNESS WHEREOF, Genmar Holdings, Inc. has caused this Debenture to be
executed and attested in its name by the signatures of its duly authorized
officers.

GENMAR HOLDINGS, INC.

By: _________________________________

Title: ______________________________

ATTEST:

_____________________________________

_____________________________________
Secretary

C-3

EXHIBIT D

REORGANIZATION AGREEMENT

EXHIBIT D

LIST OF COMPANY WARRANTS AND OPTIONS

1. WARRANTS

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Holder # of Shares Price per Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

PYRAMID INVESTORS:
--------------------------------------------------------------------------------

AWATTO Limited Partnership 2,159,016 $ .3058
--------------------------------------------------------------------------------
Xxxxxx X. Xxxxxxxxx, Xx. 33,734 .3058
--------------------------------------------------------------------------------
Xxxxxx X. Xxxxxxxxx, Xx. Irrevocable Trust
for the benefit of:
--------------------------------------------------------------------------------
Xxxx Xxxxxx Xxxxxxxxx 151,806 .3058
--------------------------------------------------------------------------------
Xxxx Xxxxx Xxxxxxxxx 151,806 .3058
--------------------------------------------------------------------------------
Xxxx Xxxxxx Xxxxxxxxx 151,806 .3058
--------------------------------------------------------------------------------
Xxxx Xxxxx Xxxxxxxxx 151,806 .3058
--------------------------------------------------------------------------------
Xxxxxxx Xxxxxx Xxxxxxxxx 151,806 .3058
--------------------------------------------------------------------------------
Xxx Xxxxx Xxxxxx 151,806 .3058
--------------------------------------------------------------------------------
Xxxx X. Xxxxxx 337,346 .3058
--------------------------------------------------------------------------------
Xxxx and Xxx Xxxxxx Irrevocable Trust for
the benefit of:
--------------------------------------------------------------------------------
Xxxxxxxxx Xxxxxx 1/31/94 25,301 .3058
--------------------------------------------------------------------------------
Xxxxxxxxx X. Xxxxxx 1/31/94 29,518 .3058
--------------------------------------------------------------------------------
Xxxxxxx X. Xxxxxx 1/31/94 29,518 .3058
--------------------------------------------------------------------------------
Xxxxxxx X. Xxxxxxxxxx Revocable Trust 590,356 .3058
--------------------------------------------------------------------------------
Xxxx X. Xxxxxx 36,060 .3058
--------------------------------------------------------------------------------
Xxxx X. Xxxx 506,019 .3058
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cornerstone Capital Advisors, Ltd. 794,425 $ .0013685
--------------------------------------------------------------------------------
Xxxxx X. Xxxxxxx 30,303 .2645
--------------------------------------------------------------------------------
Xxxxxxx X. Xxxxxx 13,130 .2645
--------------------------------------------------------------------------------
TOTAL 5,495,562
--------------------------------------------------------------------------------

D-1

2. EMPLOYEE OPTIONS

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Name of Optionee Number of Shares
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

Xxxxxx, Xxxxx X. 16,978
-------------------------------------------------------------------------------
Baggiossi, Xxxxx X. 3,531
-------------------------------------------------------------------------------
Baldoff, Xxxx X. 10,914
-------------------------------------------------------------------------------
Xxxx, Xxxxxxx X. 14,068
-------------------------------------------------------------------------------
Xxxxx, Xxxxx X. 5,549
-------------------------------------------------------------------------------
Xxxxxx, Xxxxxx X. 10,914
-------------------------------------------------------------------------------
Xxxxx, Xxxx X. 5,045
-------------------------------------------------------------------------------
Xxxxxxx, Xxxxxxx X. 4,036
-------------------------------------------------------------------------------
XxXxxx, Xxxxx X. 5,549
-------------------------------------------------------------------------------
Xxxxx, Xxxxxx X. 5,423
-------------------------------------------------------------------------------
Xxxxxxx, Xxxxxx X. 4,540
-------------------------------------------------------------------------------
Xxxxx, Xxxx 18,191
-------------------------------------------------------------------------------
Xxxxxx, Xxxxxx X. 5,045
-------------------------------------------------------------------------------
Xxxxxx, Xxxxxxx X. 5,045
-------------------------------------------------------------------------------
Xxxxxx, Xxxxxx X. 12,612
-------------------------------------------------------------------------------
Xxxxxxx, Xxxxx X. 5,423
-------------------------------------------------------------------------------
Xxxxxxxx, Xxxxxxx X. 6,457
-------------------------------------------------------------------------------
Xxxxxxx, Xxxxxx X. 9,585
-------------------------------------------------------------------------------
Xxxxxx, Xxxxxxxxxx X. 8,004
-------------------------------------------------------------------------------
Xxxxxxx, Xxxxxxx X. 6,432
-------------------------------------------------------------------------------
Xxxxxx, Xxxxx X. 5,297
-------------------------------------------------------------------------------
Xxxxxx, Xxxxx X. 6,558
-------------------------------------------------------------------------------
Xxxx, Xxxxxxx X. 6,054
-------------------------------------------------------------------------------
Xxxxxx, Xxxx XX 32,307
-------------------------------------------------------------------------------
Xxxxxxx, Xxxxx X. 18,569
-------------------------------------------------------------------------------
Leiphemer, Xxx X. 21,829
-------------------------------------------------------------------------------

D-2

--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Name of Optionee Number of Shares
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

XxXxxxxx, Xxxxxx X. 661,318
--------------------------------------------------------------------------------
Mild, Xxxxxx X. 4,540
--------------------------------------------------------------------------------
Mosconi, Jr., Xxxxx X. 6,457
--------------------------------------------------------------------------------
Xxxxx, Xxxx X. 6,558
--------------------------------------------------------------------------------
Xxxxxx, Xxxxx X. 7,567
--------------------------------------------------------------------------------
Xxxxxx, Xxxxxxx X. 14,819
--------------------------------------------------------------------------------
Xxxxxx, Xxxxxx X. 6,558
--------------------------------------------------------------------------------
X'Xxxxx, Xxxxxx X. 9,702
--------------------------------------------------------------------------------
X'Xxxx, Xxxx X. 10,914
--------------------------------------------------------------------------------
Xxxxx, Xxx X. 5,045
--------------------------------------------------------------------------------
Pond, Xxxxxxx X. 12,127
--------------------------------------------------------------------------------
Xxxxxx, Xxxxxxx X. 5,045
--------------------------------------------------------------------------------
Xxxxxxxx, Xxxxxxx X. 5,802
--------------------------------------------------------------------------------
Xxxxxxx, Xxxxxxx X. 4,919
--------------------------------------------------------------------------------
Xxxxx, Xxxxx X. 21,829
--------------------------------------------------------------------------------
Xxxxxxx, Xxxxxxx X. 6,558
--------------------------------------------------------------------------------
Sidi, Shiraz 18,191
--------------------------------------------------------------------------------
Xxxxxxxx, Xxxxx X. 5,423
--------------------------------------------------------------------------------
Xxxxx, Xxxxxx III 7,063
--------------------------------------------------------------------------------
Xxxx, Xxxx X. 6,558
--------------------------------------------------------------------------------
Xxxxx, Xxxxxxx X. 7,063
--------------------------------------------------------------------------------
Xxxxxxxxx, Xxxx X. 3,531
--------------------------------------------------------------------------------
TOTAL 1,091,542
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

3. PURCHASE RIGHT

Genmar Holdings, Inc. has the right to purchase 945,515 Shares of the Company's
Common Stock (and certain warrants) for $250,000.

D-3

EXHIBIT E

REORGANIZATION AGREEMENT

EXHIBIT E

LIST OF CRITICAL EMPLOYEES

NAME TITLE

Xxxx Xxxxxx, XX Chief Executive Officer
Xxxxxx XxXxxxxx Director of Work Systems Group
Xxx Xxxxxxxxxx Director of Manufacturing
Xxxxx Xxxxxxx Director of R&D
Xxxxxxx Xxxxxx Solution Center Manager
Xxxxxxx Xxxx Manager
Xxxxxxx X'Xxxx Project Engineer
Xxxxxx Xxxxx, III Group Leader

E-1

EXHIBIT F

REORGANIZATION AGREEMENT

EXHIBIT F

STOCKHOLDERS OF RECORD

STOCKHOLDER SHARES %
----------- ------ -

Pyramid Composites Manufacturing Limited Partnership 6,243,385 8.16%
Pyramid Composites Manufacturing, Inc. 16,640,000 21.74%
Genmar Holdings, Inc. 6,659,158 8.70%
AWATTO Limited Partnership 15,182,320 19.84%
Xxxxxx X Xxxxxxxxx, Xx. 842,467 1.10%
Xxxxxx X. Xxxxxxxxx, Xx. Irrevocable Trust fbo Xxxx Xxxxxx Xxxxxxxxx 1,061,411 1.39%
Xxxxxx X. Xxxxxxxxx, Xx. Irrevocable Trust fbo Xxxx Xxxxx Xxxxxxxxx 1,061,411 1.39%
Xxxxxx X. Xxxxxxxxx, Xx. Irrevocable Trust fbo Xxxx Xxxxxx Xxxxxxxxx 1,061,411 1.39%
Xxxxxx X. Xxxxxxxxx, Xx. Irrevocable Trust fbo Xxxx Xxxxx Xxxxxxxxx 1,061,411 1.39%
Xxxxxx X. Xxxxxxxxx, Xx. Irrevocable Trust fbo Xxxxxxx Xxxxxx Xxxxxxxxx 1,061,411 1.39%
Xxxxxx X. Xxxxxxxxx, Xx. Irrevocable Trust fbo Xxx Xxxxx Xxxxxx 1,061,411 1.39%
Xxxxxx X. Xxxxxxxxxx 911,615 1.19%
Mr. and Xxx. Xxxxxxx X. Xxxxxxxxx 781,385 1.02%
Xxxxx X. Xxxx 1,454,143 1.90%
Xxxx Xxxxxx, XX 2,499,394 3.27%
Xxxxxx X. XxXxxxxx 1,502,736 1.96%
Xxxx X. Xxxxxx 3,432,287 4.49%
Xxxx and Xxx Xxxxxx Irrevocable Trust fbo Xxxxxxxxx X. Xxxxxx 134,291 0.18%
Xxxx and Xxx Xxxxxx Irrevocable Trust fbo Xxxxxxxxx X. Xxxxxx 156,673 0.20%
Xxxx and Xxx Xxxxxx Irrevocable Trust fbo Xxxxxxx X. Xxxxxx 156,673 0.20%
Xxxxxxx X. Xxxxxxxxxx Revocable Trust 3,330,863 4.35%
Sanray Corporation 814,498 1.06%
Xxxx X. Xxxxxx 2,916,345 3.81%
Xxxx X. Xxxx 3,560,606 4.65%
Xxxxx X. Xxxxxx 159,307 0.21%
Xxxxx X. Xxxxxx 187,402 0.24%
Gefsky and Xxxxxx Investment Partnership III 347,104 0.45%
Xxxxxx Xxxxxxxx 990,360 1.29%
Xxxxxx Xxxxxxxxx 261,640 0.34%
Xxxx Xxxxxxxx 990,360 1.29%
------- -----
TOTAL 76,523,478 100.00%

F-1

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