ASSET PURCHASE AGREEMENT



     THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made and entered into

as of the 24th day of May, 2002 by and between QUALITY PRODUCTS, INC. a Delaware

corporation ("Buyer"), and SCHULER INCORPORATED, an Ohio corporation ("Seller").



                                     RECITAL



     Seller desires to sell to Buyer, and Buyer desires to purchase from Seller,

a certain metal milling machine owned by Seller and used in Seller's business,

subject to the terms and conditions of this Agreement.



                                    AGREEMENT



     NOW, THEREFORE, in consideration of the mutual agreements and covenants

hereinafter contained, the parties hereto agree as follows:



     Section 1.     SALE AND PURCHASE OF ASSETS. On the terms and subject to the

conditions herein expressed, Seller agrees to sell, transfer, assign and deliver

to Buyer, and Buyer agrees to purchase, acquire and accept from Seller, on and

as of the Closing Date (as defined in Section 4 hereof), all of Seller's right,

title and interest as of the Closing Date in and to that certain metal milling

machine used in Seller's business, which asset is more fully described on

EXHIBIT A attached hereto (the "Mill").



     Section 2.     RETAINED ASSETS. Other than the Mill, Buyer shall not

purchase or obtain any right, title or interest of Seller in, to or under any of

Seller's assets not described in Section 1, including, without limitation, the

following: Seller's name, cash, accounts receivable, tax returns, advances owed

to Seller, equipment and other fixed assets not described in EXHIBIT A (the

"Retained Assets").



     Section 3.     PURCHASE PRICE. The purchase price for the Mill shall be

One Hundred Eighty Thousand Dollars ($180,000), to be paid by Buyer to Seller

in thirty-six (36) equal monthly payments of $5,000 beginning July 1, 2002.

Buyer's obligation shall be evidenced by a promissory note in the form attached

hereto as EXHIBIT B (the "Note") and shall be secured by a Security Agreement in

the form attached hereto as EXHIBIT C (the "Security Agreement").



     Section 4.     THE CLOSING. The transaction contemplated by this Agreement

shall be closed (the "Closing") at the offices of Porter, Wright, Morris &

Arthur LLP, 41 S. High Street, Columbus, Ohio 4315 on May 24, 2002 (the "Closing

Date"), or such other date or place as the parties may mutually agree.



     Section 5.     SELLER'S DELIVERIES. Seller shall execute and deliver (or

cause to be delivered) to Buyer the following at Closing:



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            (a)     a certificate of an officer of Seller, dated as of the

Closing Date, to the effect that the representations and warranties made by the

Seller in this Agreement are true and correct as of the Closing;



            (b)     a copy of the resolutions of the Board of Directors of

Seller approving the consummation of the transaction contemplated by this

Agreement;



            (c)     a bill of sale transferring the Mill;



     Section 6.     BUYER'S DELIVERIES. Buyer shall deliver the following at

Closing:



            (a)     a certificate of an officer of Buyer, dated as of the

Closing Date, to the effect that the representations and warranties made by the

Buyer in this Agreement are true and correct as of the Closing;



            (b)     a copy of the resolutions of the Board of Directors of Buyer

approving this Agreement, the Note, the Security Agreement and consummation of

the transaction contemplated by this Agreement;



            (c)     the Note;



            (d)     the Security Agreement; and



            (e)     the Unit Exemption Certificate referenced in Section 15.



     Section 7.     REPRESENTATIONS AND WARRANTIES OF SELLER. Seller hereby

warrants and represents to and covenants with Buyer and its successors and

assigns as follows:



            (a)     ORGANIZATION AND QUALIFICATION. Seller is a corporation duly

organized, validly existing and in good standing under the laws of the State of

Ohio and has all requisite power and authority to own or lease and operate its

properties and assets and to carry on its business as it is now being conducted.



            (b)     VALIDITY AND EXECUTION. Seller has full legal right,

capacity and power and all requisite authority and approval required to enter

into, execute and deliver this Agreement and to perform fully Seller's

obligations hereunder. This Agreement has been duly executed and delivered by

Seller and constitutes the valid and binding obligation of Seller enforceable

against Seller in accordance with its terms, subject to the qualifications that

enforcement of the rights and remedies created hereby may be subject to (i)

bankruptcy, insolvency, reorganization, moratorium and other laws of general

application affecting the rights and remedies of creditors and (ii) general

principles of equity.



            (c)     NON-CONTRAVENTION. The execution and delivery of this

Agreement by Seller and the consummation by Seller of the transactions

contemplated hereby will not (1)



                                        2

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violate or conflict with any provision of the Articles of Incorporation or Code

of Regulations of Seller or (2) result in the creation or imposition of any

encumbrances in favor of any third person or entity upon the Mill.



            (d)     TITLE TO MILL. Seller has, and pursuant to this Agreement

will convey, sell, transfer and assign to Buyer, good and marketable title to

the Mill, free and clear of liens, encumbrances, encroachments, defects of

title, easements, licenses, covenants, leases, claims of third parties, security

interests, mortgages, deeds of trust, pledges, agreements and rights of others.



     Section 8.     REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer hereby

warrants and represents to and covenants with Seller and its successors and

assigns as follows:



            (a)     ORGANIZATION AND QUALIFICATION. Buyer is a corporation duly

organized, validly existing and in good standing under the laws of the State of

Delaware and has all requisite power and authority to own or lease and operate

its properties and assets and to carry on its business as it is now being

conducted.



            (b)     VALIDITY AND EXECUTION. Buyer has full legal right, capacity

and power and all requisite authority and approval required to enter into,

execute and deliver this Agreement and to perform fully Buyer's obligations

hereunder. This Agreement has been duly executed and delivered by Buyer and

constitutes the valid and binding obligation of Buyer enforceable against Buyer

in accordance with its terms, subject to the qualifications that enforcement of

the rights and remedies created hereby may be subject to (i) bankruptcy,

insolvency, reorganization, moratorium and other laws of general application

affecting the rights and remedies of creditors and (ii) general principles of

equity.



            (c)     NON-CONTRAVENTION. The execution and delivery of this

Agreement by Buyer and the consummation of Buyer of the transactions

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