Johann T. and Johanna Hess - Page 8

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          Mr. Kucklick’s agreement to enter into an employment agreement.             
          The redemption agreement required HII to pay Mr. Kucklick $1                
          million at closing and to deliver the installment note in the               
          principal amount of $2,953,642.56 for the balance, a total                  
          payment of $3,953,642.56.7  The redemption agreement terminated             
          the stockholders agreement.                                                 
               The redemption agreement contained an 8-year, worldwide                
          covenant not to compete (the 8-year covenant) to commence after             
          Mr. Kucklick retired from HII and its subsidiaries.  The duration           
          and the scope of the 8-year covenant were very important                    
          provisions to Mr. Hess and HII.  Mr. Hess believed that the 8-              
          year covenant was important to him, because Mr. Kucklick was                
          still relatively young,8 and with his knowledge and contacts, he            
          could set up a competing company, he could consult, and he could            
          be a partner in, or work for, another company.  Mr. Hess believed           
          that without the 8-year covenant, Mr. Kucklick could have done              
          considerable damage to HII, perhaps resulting in millions of                
          dollars in lost profits in a relatively short time period.                  
               With respect to the duration of the 8-year covenant, Mr.               
          Kucklick originally wanted it to cover the period of his                    
          employment and 2 years thereafter, the same duration as the                 


               7Mr. Hess derived the total payment by reducing his $4                 
          million offer to reflect an increase in the interest rate for the           
          installment note.                                                           
               8Mr. Kucklick was approximately 50 years old in 1994.                  




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