Exhibit 10.2


                                Table of Contents
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Section 1 Interpretation...........................................................................................1


Section 2 Appointment of the Agents................................................................................3


Section 3 Forms of Notes; Authentication; Signatures...............................................................3


Section 4 Authorized Officers......................................................................................4


Section 5 Execution, Authentication, Delivery, Dating and Notification.............................................4


Section 6 Payments to Holders......................................................................................5


Section 7 Deposit of Moneys; Prescription..........................................................................9


Section 8 Registration of Transfer and Exchange....................................................................10


Section 9 Replacement Notes........................................................................................10


Section 10 Cancellation............................................................................................10


Section 11 Representations, Warranties and Certain Covenants of the Issuer.........................................10


Section 12 Fees and Expenses.......................................................................................10


Section 13 Rights and Liabilities of the Agents....................................................................11


Section 14 Notes Held by the Agents................................................................................13


Section 15 Duties as Information ..................................................................................13


Section 16 Duties of the Agents....................................................................................13


Section 17 Changes in Agents.......................................................................................14


Section 18 Indemnification.........................................................................................16


Section 19 Merger, Consolidation or Sale of Business by any Agent..................................................17


Section 20 Notices.................................................................................................17


Section 21 Modifications and Waivers...............................................................................19


Section 22 Judgment Currency.......................................................................................19


Section 23 Rights of Third Parties.................................................................................20


Section 24 Governing Law; Submission to Jurisdiction...............................................................20


Section 25 Counterparts............................................................................................21
</TABLE>




<PAGE>



                                                                  EXECUTION COPY







                           SANITEC INTERNATIONAL S.A.
                                    AS ISSUER

                                       AND

                              THE BANK OF NEW YORK
         AS PRINCIPAL PAYING AGENT, NEW YORK PAYING AGENT AND REGISTRAR

                                       AND

                     THE BANK OF NEW YORK (LUXEMBOURG) S.A.
                           AS LUXEMBOURG PAYING AGENT

                                       AND

                              THE BANK OF NEW YORK
                                   AS TRUSTEE





                            9% SENIOR NOTES DUE 2012




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

                             PAYING AGENCY AGREEMENT

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





<PAGE>



         THIS AGREEMENT is made on May 7, 2002, among SANITEC INTERNATIONAL S.A.
(the "Issuer"); THE BANK OF NEW YORK, as principal paying agent (the "Principal
Paying Agent"); THE BANK OF NEW YORK, as registrar and transfer agent (the
"Registrar"); THE BANK OF NEW YORK, as New York paying agent (the "New York
Paying Agent"); THE BANK OF NEW YORK (LUXEMBOURG) S.A., as Luxembourg paying
agent (the "Luxembourg Paying Agent" and, together with the Principal Paying
Agent and the New York Paying Agent, the "Paying Agents" which expression shall,
where the context so admits, include any successor paying agent(s) or
registrar(s) for the time being appointed); and THE BANK OF NEW YORK, as trustee
(the "Trustee", which expression includes any other trustee for the time being
of the Indenture referred to below).

         WHEREAS, the Issuer has authorised the creation and issue of
(Euro)260,000,000 in aggregate principal amount of 9% Senior Notes due 2012 (the
"Notes"); the Notes are constituted by and have the benefit of, an indenture
dated May 7, 2002 (as amended and/or supplemented from time to time, the
"Indenture") and made between the Issuer and the Trustee; the Notes will be in
registered form and in a minimum denomination of (Euro)1,000; the Notes will be
represented by Global Notes, which will be exchangeable for certificates
representing Definitive Registered Notes only in the limited circumstances
specified therein; and the Issuer, the Registrar, the Paying Agents and the
Trustee wish to record certain arrangements which they have made in relation to
the Notes;

         IT IS AGREED as follows:

SECTION 1       INTERPRETATION

         (a) In this Agreement, the following expressions have the following
meanings:

         "AGENTS" means the Paying Agents and the Registrar and "AGENT" means
any one of the Agents;

         "BUSINESS DAY" means any day on which commercial banking institutions
are open for business and carrying out transactions in euro in the country in
which the Principal Paying Agent has its Specified Office and is a day on which
the Trans-European Automated Real-Time Gross Settlement Express Transfer System
("TARGET") is operating;

         "CLEARSTREAM BANKING" means Clearstream Banking, SOCIETE ANONYME;


<PAGE>

         "DEPOSITARY" or "DEPOSITARIES" means one or more of Euroclear,
Clearstream Banking, or the successor of either of them, in each case acting
directly, or through a custodian, nominee or depository, as registered Holder of
a Global Note;

         "EUROCLEAR" means Euroclear Bank S.A./N.A., as operator of the
Euroclear System;

         "HOLDER" means a Person in whose name a Note is registered in the
Registrar's books;

         "PERSON" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organisation, limited
liability company, government or any agency or political jurisdiction thereof or
any other entity;

         "REQUIRED AGENT" means any Paying Agent or any Registrar which is the
sole remaining Paying Agent with its Specified Office in any city where each
stock exchange or other relevant authority (if any) on which the Notes are then
listed requires there to be a Paying Agent or a Registrar; and

         "SPECIFIED OFFICE" means, in relation to any Agent:

                  (1) the office specified against its name in Exhibit 1 hereto;
         or

                  (2) such other office as such Agent may specify in accordance
         with Section 17(g).

         (b) In this Agreement, any reference to principal includes premium and
any reference to principal or interest includes any Special Interest or
Additional Amounts payable in relation thereto under the Notes.

         (c) Terms and expressions used but not defined herein have the
respective meaning given to them in the Notes or the Indenture.

         (d) Headings and sub-headings are for ease of reference only and shall
not affect the construction of this Agreement.

         (e) If and to the extent that any provision of this Agreement conflicts
or is inconsistent with the Indenture, the Indenture shall prevail.



                                      -2-
<PAGE>

SECTION 2       APPOINTMENT OF THE AGENTS

         (a) The Issuer, and for the purposes of Section 13(b) only, the Trustee
hereby appoints each Agent to act in relation to the Notes, on the terms and
conditions specified herein for the purposes specified in this Agreement, the
Indenture and the Notes.

         (b) Each Agent hereby accepts the appointment set forth in Section 2(a)
above upon the terms, and subject to, the conditions set forth in this Agreement
and agrees to comply with the terms of this Agreement. Each Agent shall have the
powers and authority granted to and conferred upon it herein and in the Notes
and such further powers and authority, acceptable to it, to act on behalf of the
Issuer, and, for the purposes of Section 13(b) hereof, the Trustee as the Issuer
and/or, the Trustee as the case may be, may hereafter grant to or confer upon
it.

SECTION 3       FORMS OF NOTES; AUTHENTICATION; SIGNATURES

         (a) The face and reverse of each Global Note and any Definitive
Registered Notes shall be in substantially the form set out in the Indenture.
The Global Notes and any Definitive Registered Notes shall be executed in
accordance with Section 2.02 of the Indenture and authenticated manually by or
on behalf of the Principal Paying Agent. The Global Notes shall be deposited
with The Bank of New York, and registered in the name of The Bank of New York
Depository (Nominees) Limited, a nominee for a common depositary for the
Depositaries.

         (b) Notes may also have such additional provisions, omissions,
variations or substitutions as are not inconsistent with the provisions of this
Agreement and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with any law or with any rules made pursuant thereto or with the rules of the
Depositaries, each stock exchange, quotation system or listing authority (if
any) on or by which the Notes are listed or quoted from time to time, any
depository, clearance facility or governmental agency or as may consistently
herewith be determined by the authorized Officers (as defined in the Indenture)
of the Issuer executing such Notes, as evidenced by execution of such Notes. If
the Issuer is required to deliver Definitive Registered Notes pursuant to the
Indenture the Issuer shall promptly furnish the Principal Paying Agent with an
adequate supply of Definitive Registered Notes (unauthenticated and with the
names of the Holders left blank but executed on behalf of the Issuer and
otherwise complete). The Issuer shall also arrange for such Global Notes and
Definitive Registered



                                      -3-
<PAGE>

Notes as are required to enable the Registrar to perform their respective
obligations under Section 8 and Section 9 to be made available to or to the
order of the Registrar from time to time. The Registrar shall hold in safe
custody all unauthenticated Global Notes and Definitive Registered Notes
delivered to it in accordance with this Section and Section 4 below and shall
ensure that they are authenticated and delivered only in accordance with the
terms hereof (and any Authentication Order (as defined in the Indenture) made
pursuant to the terms hereof), of the Global Notes (if applicable) and of the
Indenture. Each Note will bear the manual signature or facsimile signature of
two authorized Officers of the Issuer and the Principal Paying Agent shall, upon
the receipt of a Authentication Order, authenticate and deliver the Notes in
accordance with such Authentication Order. The aggregate principal amount of the
Notes issued on the closing date of the offering of the Notes shall be equal to
the aggregate principal amount of the Notes which the Issuer has authorised the
creation of and shall not exceed (Euro)260,000,000.

SECTION 4       AUTHORIZED OFFICERS

         As necessary, the Issuer will furnish the Trustee and Registrar with a
certificate of the Issuer certifying the incumbency and specimen signature of
each authorized Officer and a certificate of the Issuer certifying the
incumbency and specimen signatures of officers authorized to give instructions
to the Trustee and/or Registrar as the case may be, with respect to the
completion and delivery of Notes. Until, in each such case, the Trustee and/or
Registrar as the case may be, receives a subsequent incumbency certificate, the
Trustee and/or Registrar as the case may be, shall be entitled to rely on the
information set forth in the incumbency certificates it last received for the
purposes of determining the authorized Officers. Any such subsequent incumbency
certificate of an authorized Officer shall be accompanied by an adequate supply
of Definitive Registered Notes which are unauthenticated and with the names of
the Holders left blank but executed on behalf of the Issuer by the authorized
Officers and otherwise complete.

SECTION 5       EXECUTION, AUTHENTICATION, DELIVERY, DATING AND NOTIFICATION

         The Notes shall be executed upon issuance on behalf of the Issuer by
two authorized Officers of the Issuer. If not already completed by the Issuer,
the Principal Paying Agent will complete each Note with the name of the relevant
Holder and with the principal amount in accordance with an Authentication Order
of the Issuer and will authenticate such Note. If an authorized Officer whose
signature is on a Note was an authorized Officer at the time of such execution
but no longer holds that office or position at the time (for whatever reason,
including



                                      -4-
<PAGE>

death) and the Principal Paying Agent authenticates the Note, the Note shall
nevertheless be valid. A Note shall not be valid until an authorised signatory
of the Principal Paying Agent manually signs the certificate of authentication
(substantially in the form set out in the Indenture) on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Agreement. The Notes shall be issued in the order of the serial numbers
imprinted thereon and shall be dated the date of their authentication by the
Principal Paying Agent and delivery to the Holder shall be made in the manner
agreed upon by the Issuer and the Principal Paying Agent and set forth in the
relevant Authentication Order. The Issuer will provide the Registrar with such
information necessary to maintain a register of Holders. Any instructions given
by the Issuer shall be given in the form of a Authentication Order signed on
behalf of the Issuer by an authorized Officer or authorized Officers in the
manner provided for in the resolutions of the Board of Directors of the Issuer
or duly authorized committees thereof applicable to the Notes, at the time any
such instruction is given. The Principal Paying Agent shall be entitled to rely
upon any Authentication Order signed by an authorized Officer or authorized
Officers as a confirmation that the issuance of the Notes contemplated by such
written order complies with the requirements of such resolutions.

SECTION 6       PAYMENTS TO HOLDERS

         (a) The relevant Agent will pay, subject to the deposit of funds by the
Issuer in accordance with Section 7(a), the principal amount of each Note at
maturity or upon redemption, together with accrued interest due at maturity or
redemption, as the case may be, to the Holder as set forth on the face of the
Note against presentation and surrender of such Note, upon which the Principal
Paying Agent will cancel and destroy such Note and remit a certificate of
destruction directly to the Issuer in accordance with the Principal Paying
Agent's customary practice.

         (b) Each payment of interest and principal shall be made by wire
transfer of immediately available funds to the accounts specified by the Holder
of the relevant Global Note. With respect to Definitive Registered Notes, all
payments of interest and principal will be made by wire transfer of immediately
available funds to the accounts specified by the Holders thereof or, if no such
account is specified, by mailing a cheque to each Holder's registered address.

         (c) All payments in respect of the Notes are subject in all cases to
any applicable fiscal or other laws and regulations, but without prejudice to
the provisions of the Notes. No commissions or expenses shall be charged to the
Holders in respect of such payments.



                                      -5-
<PAGE>

         (d) Where payment is to be made by transfer to a euro account, payment
instructions (for value on the due date, or, if the due date is not a business
day, for value on the next succeeding business day) will be initiated and, where
payment is to be made by euro cheque, the cheque will be mailed (i) (in the case
of payments of principal and interest payable on redemption) on the later of the
due date for payment and the day on which the relevant Note is surrendered (or,
in the case of part payment only, endorsed) at the Specified Office of a Paying
Agent and (ii) (in the case of payments of interest payable other than on
redemption) on the due date for payment. A Holder of a Note shall not be
entitled to any interest or other payment in respect of any delay in payment
resulting from (A) the due date for a payment not being a business day or (B) a
cheque mailed in accordance with this Section 6 arriving after the due date for
payment or being lost in the mail. In this paragraph, "business day" means any
day which is a day on which TARGET is operating and on which banks are open for
business (including dealings in foreign currencies), in the case of surrender
(or, in the case of part payment only, endorsement) of a Note, in the place in
which the Note is surrendered (or, as the case may be, endorsed).

         (e) Each Paying Agent acting through its Specified Office shall make
payments of interest and principal in respect of Notes, so long as the Notes are
evidenced by the Global Note, in accordance with the terms thereof; provided,
however, that:

                  (1) if the Global Note or Definitive Registered Note is
         presented or surrendered for payment to any Paying Agent and such
         Paying Agent has delivered a replacement therefor or has been notified
         that the same has been replaced, such Paying Agent shall forthwith
         notify the Issuer and (if such Paying Agent is not the Principal Paying
         Agent) the Principal Paying Agent of such presentation or surrender and
         shall not make payment against the same until it is so instructed by
         the Issuer and the Principal Paying Agent has received the amount to be
         so paid;

                  (2) a Paying Agent shall not be obliged (but shall be
         entitled) to make such payments if:


                  (A)      in the case of the Principal Paying Agent, it has not
                           received the full amount of any payment due to it
                           under Section 7(a); or

                  (B)      in the case of any other Paying Agent:



                                      -6-
<PAGE>

                           (i) it has been notified in accordance with Section
                           7(a) that the full amount of any payment required to
                           be made has not been received, unless it is
                           subsequently notified that the full amount of any
                           payment required to be made has been received; or

                           (ii) it is not able to establish that the Principal
                           Paying Agent has received (whether or not at the due
                           time) the full amount of any payment due to it under
                           Section 7(a);

                  (3) each Paying Agent shall cancel each Note against
         presentation and surrender of which it has made full payment and shall
         deliver each Note so cancelled by it to, or to the order of, the
         Registrar; and

                  (4) notwithstanding any other provision of this Agreement,
         each Paying Agent shall be entitled to make a deduction or withholding
         from any payment which it makes under this Agreement for or on account
         of any present or future taxes, duties or charges if and to the extent
         so required by applicable law, in which event such Paying Agent shall
         make such payment after such withholding or deduction has been made and
         shall account to the relevant authorities for the amount so withheld or
         deducted.

         (f) No Paying Agent shall exercise any lien, right of set-off or
similar claim against any person to whom it makes any payment under Section 6(e)
in respect thereof, nor shall any commission or expense be charged by it to any
such person in respect thereof.

         (g) If a Paying Agent other than the Principal Paying Agent makes any
payment in accordance with Section 6(e):

                  (1) it shall notify the Principal Paying Agent of the amount
         so paid by it and the serial number and principal amount of each Note
         in relation to which payment of principal or interest was made; and

                  (2) subject to and to the extent of compliance by the Issuer
         with Section 7(a), (whether or not at the due time), the Principal
         Paying Agent shall pay to such Paying Agent out of the funds received
         by it under Section 7(a), by credit transfer in euro and in immediately
         available, freely transferable, cleared funds to such account with such
         bank as such Paying



                                      -7-
<PAGE>

         Agent has by notice to the Principal Paying Agent specified for the
         purpose, an amount equal to the amount so paid by such Paying Agent.

         (h) If the Principal Paying Agent makes any payment in accordance with
Section 6(e) it shall be entitled to appropriate for its own account out of the
funds received by it under Section 7(a) an amount equal to the amount so paid by
it.

         (i) Subject to sub-clauses 6(e)(1) and 6(e)(2), if a Paying Agent makes
a payment in respect of Notes on or after the due date for such payment under
the Indenture at a time at which the Principal Paying Agent has not received the
full amount of the relevant payment due to it under Section 7(a) and the
Principal Paying Agent is not able out of funds received by it under Section
7(a) to reimburse such Paying Agent therefor (whether by payment under Section
6(g) or appropriation under Section 6(h)), the Issuer shall from time to time on
demand pay to the Principal Paying Agent for account of such Paying Agent:

                  (1) the amount so paid out by such Paying Agent and not so
         reimbursed to it; and

                  (2) interest on such amount from the date on which such Paying
         Agent made such payment until the date of reimbursement of such amount;

PROVIDED, HOWEVER, that any payment made under sub-paragraph (1) shall satisfy
PRO TANTO the obligations of the Issuer under Section 6(a).

         Interest shall accrue for the purpose of sub-paragraph (1) of Section
6(i) (as well after as before judgment) on the basis of a year of 365 days and
the actual number of days elapsed and at the rate per annum which is the
aggregate of one percent per annum and the rate per annum specified by such
Paying Agent as reflecting its cost of funds for the time being in relation to
the unpaid amount.

         If at any time and for any reason a Paying Agent makes a partial
payment in respect of any Note presented for payment to it, such Paying Agent
shall endorse thereon a statement indicating the amount and the date of such
payment. In addition, if, on any due date for payment, less than the full amount
of any principal or interest is paid in respect of the Notes, the Registrar will
note on the register of Holders a memorandum of the amount and date of any
payment then made and, if the Note is presented for payment in accordance with
this Agreement and the Indenture and no payment is then made, the date of
presentation of such Note.



                                      -8-
<PAGE>

SECTION 7       DEPOSIT OF MONEYS; PRESCRIPTION

         (a) Prior to 10:00 a.m. (London time) on or prior to each Interest
Payment Date, the Maturity Date and each payment date relating to an Asset Sale,
Offer or a Change of Control Offer, and on the Business Day immediately
following an acceleration of the Notes pursuant to Section 6.02 of the
Indenture, the Issuer shall have deposited with the Trustee or its designated
Paying Agent (which shall be the Principal Paying Agent unless otherwise
notified to the Issuer by the Trustee) in immediately available funds money (in
Euros) sufficient to make cash payments, if any, due on such Interest Payment
Date, Maturity Date or Business Day, as the case may be, on all Notes then
outstanding. Such payments shall be made by the Issuer in a timely manner which
permits the Paying Agent to remit payment to the Holders on such Interest
Payment Date, Maturity Date or Business Day, as the case may be, to the Persons
and in the manner set forth in paragraph 2 of the Notes. In the event that the
Principal Paying Agent does not receive from the Issuer the full amount of any
payment required to be made on any interest payment date or at Maturity, in
accordance with this Section 7, (i) the Principal Paying Agent shall give prompt
notice to the Issuer, the Trustee and each other Paying Agent of any such non
payment and (ii) each payment on account of principal of and interest on the
Notes shall be made pro rata according to the respective principal amounts of
the Notes then outstanding.

         (b) Claims against the Issuer in respect of principal, premium,
interest, Special Interest and Additional Amounts will become void unless made
within a period of ten years (in the case of principal, premium or Additional
Amounts) and five years (in the case of interest or Special Interest) from the
appropriate interest payment date. Any money deposited with the Principal Paying
Agent for the payment of the principal of, premium, if any, or interest or
Special Interest or Additional Amounts, if any, on any Note which remains
unclaimed for two years after such amounts have become due and payable, shall be
paid to the Issuer upon its request PROVIDED, that the Principal Paying Agent,
before being required to make any payment, may at the expense of the Issuer
cause to be published once in a newspaper of general circulation in Luxembourg
(which is expected to be the LUXEMBURGER WORT) and mail to each Holder entitled
to such money notice that such money remains unclaimed and that after a date
specified therein which shall be at least 30 days from the date of such
publication and mailing, any unclaimed balance of such money then remaining will
be repaid to the Issuer. After payment to the Issuer, the Holder of the relevant
Note shall thereafter, as an unsecured subordinated creditor, look only to the
Issuer for payment thereof and all liability of the Principal Paying Agent with
respect to such money shall thereupon cease.



                                      -9-
<PAGE>

         (c) The relevant Agent shall be entitled to deal with each amount paid
to it under Section 7(a) in the same manner as other amounts paid to it as a
banker by its customers; provided, however, that it shall not exercise against
the Issuer any lien, right of set-off or similar claim in respect thereof and it
shall not be liable to any person for interest thereon.

SECTION 8       REGISTRATION OF TRANSFER AND EXCHANGE

         Registration of transfers and exchanges shall be made pursuant to
Section 2.07 of the Indenture.

SECTION 9       REPLACEMENT NOTES

         Replacement Notes shall be issued pursuant to Section 2.08 of the
Indenture.

SECTION 10      CANCELLATION

         Cancellation of Notes shall be made pursuant to Section 2.12 of the
Indenture.

SECTION 11      REPRESENTATIONS, WARRANTIES AND CERTAIN COVENANTS OF THE ISSUER

         (a) Each instruction given to the Registrar in accordance with Section
4 hereof shall constitute a representation and warranty to the Registrar by the
Issuer that the issuance and delivery of the Notes has been duly and validly
authorized by the Issuer and that the Notes constitute the valid and legally
binding obligations of the Issuer.

         (b) The Issuer shall provide the Registrar with (i) conformed copies of
this Agreement and the Indenture, and (ii) the information and reports it is
required to provide to the Trustee under Sections 4.03 and 4.04 of the
Indenture.

         (c) The Issuer shall take all actions necessary, including but not
limited to obtaining all permits and agreeing to all amendments necessary due to
any change in, or interpretation regarding, any law, to ensure that the Notes
remain legal, valid and enforceable under English law.

SECTION 12      FEES AND EXPENSES

         (a) Each of the Agents shall be entitled to such compensation
(including any value added tax or any similar tax thereon) for its services
under



                                      -10-
<PAGE>

this Agreement at such rate as shall be agreed upon between the Principal Paying
Agent, on behalf of the Agents, and the Issuer, which shall be paid annually in
advance. The Issuer shall promptly reimburse the Principal Paying Agent for the
account of the Agents for all out-of-pocket expenses (including fees and
disbursements of its legal counsel) plus any applicable value added tax or
similar tax reasonably and properly incurred by it in connection with the
services rendered by it hereunder. The obligations of the Issuer to the Agents
pursuant to this Section 12 shall survive the satisfaction or termination of
this Agreement.

         (b) The Issuer shall pay all stamp, registration and other taxes and
duties (including any interest and penalties thereon or in connection therewith)
which are payable upon or in connection with the execution and delivery of this
Agreement, and the Issuer shall indemnify each Agent on demand against any
claim, demand, action, liability, damages, cost, loss or expense (including,
without limitation, legal fees and any applicable value added tax or similar
tax) which it incurs as a result of, or arising out of or in relation to, any
failure to pay or delay in paying any of the same. All payments of compensation
or remuneration to the Agents under this Section 12 shall be made free and clear
of, and without withholding or deduction for or on account of, any present or
future Taxes, imposed or levied by or on behalf of any Taxing Authority within
Luxembourg or within any other jurisdiction in which the Issuer is organised or
resident for tax purposes or any political subdivision thereof or any Taxing
Authority therein (each, a "Relevant Taxing Jurisdiction"), unless the
withholding or deduction of Taxes is then required by law or by the
interpretation or administration thereof. If any deduction or withholding for,
or on account of, any Taxes imposed by a Relevant Taxing Jurisdiction, shall at
any time be required on any such payments of compensation and remuneration, the
Issuer will pay (together with such payments) such additional amounts as may be
necessary so that the net amounts received in respect of such payments by the
Agents, after such withholding or deduction (including any such deduction or
withholding from such additional amounts), shall equal the respective amounts
which would have been received by the Agents if such Taxes had not been withheld
or deducted.

SECTION 13      RIGHTS AND LIABILITIES OF THE AGENTS

         (a) Each of the Agents shall incur no liability for, or in respect of,
any action taken, omitted to be taken or suffered by it in reliance upon any
certificate, affidavit, instruction, notice, request, direction, order,
statement or other paper, document or communication reasonably believed by it to
be genuine and made or given and signed by the proper person or persons on
behalf of the proper parties; provided, however, that this Section 13 shall not
protect any Agent from any



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<PAGE>

liability relating to or arising out of actions or omissions in any capacity
hereunder caused by its wilful default, negligence or bad faith. Any order,
certificate, affidavit, written instruction, notice, request, direction,
statement or other communication from the Issuer made or given by it and sent,
delivered or directed to any Agent under, pursuant to or as permitted by, any
provision of this Agreement shall be sufficient for purposes of this Agreement
so long as it is in writing and signed by any authorized Officer of the Issuer.
Each of the Agents may, but will not be obligated to, consult with counsel
satisfactory to it and the advice of such counsel shall constitute full and
compete authorisation and protection of such Agent with respect to any action
taken, omitted to be taken or suffered by it hereunder in good faith and in
accordance with and in reliance upon the advice of such counsel.

         The recitals contained herein and in the Notes shall be taken as the
statements of the Issuer and the Agents assume no responsibility for the
correctness of the same. The Agents do not make any representation as to the
validity or sufficiency of this Agreement or the Notes, except for each Agent's
due authorisation, execution and delivery of this Agreement. The Agents shall
not be accountable for the use or application by the Issuer of the proceeds of
any Notes.

         Unless herein or in the Notes otherwise specifically provided, any
order, certificate, notice, request, direction or other communication from the
Issuer made or given under any provision of this Agreement shall be sufficient
if signed by an authorized officer or any attorney-in-fact of the Issuer.

         (b) If any Default or Event of Default occurs, the Agents shall, if so
required by notice given by the Trustee to the Issuer and the Agents (or such of
them as are specified by the Trustee):

                  (1) act thereafter, until otherwise instructed by the Trustee,
         as the agents of the Trustee in relation to payments and calculations
         to be made by or on behalf of the Trustee under the Indenture (save
         that the Trustee's liability for the indemnification, remuneration and
         expenses of the Agents shall be limited to the amounts for the time
         being held by the Trustee on the trusts of the Indenture and available
         to the Trustee for such purpose) and thereafter to hold all Notes and
         all moneys, documents and records held by them in respect of the Notes
         on behalf of the Trustee; and/or

                  (2) deliver up all Notes and all moneys, documents and records
         held by them in respect of the Notes to the Trustee or as the Trustee
         shall



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<PAGE>

         direct in such notice; provided, however, that such notice shall not be
         deemed to apply to any document or record which any Agent is obliged
         not to release by any law or regulation.

SECTION 14      NOTES HELD BY THE AGENTS

         Any of the Agents, its officers, employees and shareholders may become
the owner of, or acquire any interests in the Notes, with the same rights (and
subject to the same limitations) as if such Agent were not an Agent hereunder.
Any of the Agents may engage in, or have an interest in, any financial or other
transaction with the Issuer or any of its Affiliates (as defined in the
Indenture) (including, without limitation, foreign exchange transactions of any
type or nature and in any currency, whether a spot transaction, forward
transaction, option, future or otherwise) and may act on, or as depository,
trustee or agent for, any committee or body of holders of the Notes or other
obligations of the Issuer, as if such Agent were not an Agent hereunder.

SECTION 15      DUTIES AS INFORMATION AGENT

         (a) The Registrar will arrange for all materials set forth in Section
11(b), if any, made available by the Issuer and supplied to the Registrar to be
made available for inspection at the office of each Agent to the Holders
appearing on the register of Holders, or to any prospective purchaser of a Note
designated by the Holder of such Note to the relevant Agent. Whenever the Issuer
intends to provide such information to the Holders or a prospective purchaser,
the Issuer will cooperate with the Registrar, on behalf of the Agents, so that
such information is provided to the Holders or the prospective purchaser in a
timely manner.

         (b) The Registrar will carry out such other acts as may be necessary to
give effect to the Notes and the other provisions of this Agreement and the
Indenture. The Registrar shall notify the Issuer forthwith upon any changes in
the register of Holders in order to enable the Issuer to maintain a register
consistent in all respects with the register of Holders as required under
Luxembourg law at its registered office. In addition, upon notification by the
Issuer of receipt of service of demands, requests, instructions, orders,
judgments or awards, the Registrar shall (to the extent required by law)
forthwith make such entries in the register of Holders to give effect to such
demands, requests, instructions, orders, judgments or awards.



                                      -13-
<PAGE>

SECTION 16      DUTIES OF THE AGENTS

         (a) In acting under this Agreement and in connection with the Notes,
each of the Agents shall be obligated only to perform such duties as are
specifically set forth herein and in the Notes, and as are required of such
Agent by applicable law, and none of the Agents shall be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement, and no other duties or obligations on the part of any Agent shall be
implied by this Agreement or the Notes. In acting under this Agreement, none of
the Agents assumes any obligation towards, or any relationship of agency or
trust for or with, the Holders.

         (b) Upon receipt by the Registrar of notice from the Issuer that a
Default or an Event of Default has occurred, the Registrar shall give notice of
the occurrence thereof to the Trustee, the other Agents and the Holders, in
accordance with the terms of the Notes.

         (c) Each Agent shall promptly forward to the Issuer (with a copy to the
Trustee) any notice or demand received by such Agent from any Holder.

         (d) The Registrar shall, upon and in accordance with the instructions
of the Issuer received at least 10 days before the proposed publication date,
arrange at the cost of the Issuer for the publication and delivery of any notice
which is to be given to the Holders and shall supply a copy thereof to the other
Agents, the Trustee, each stock exchange or other relevant authority (if any) on
which the Notes are then listed and each Depositary.

SECTION 17      CHANGES IN AGENTS

         (a) Any Agent may at any time resign its appointment by giving no less
than 30 days' written notice to the Issuer (with a copy, in the case of an Agent
other than the Registrar, to the Registrar and, in each case, to the Trustee),
provided however, that (i) if such resignation would otherwise take effect less
than 30 days before or after the maturity of the Notes or other Redemption Date
or any Regular Record Date for an Interest Payment Date, it shall not take
effect until the 90th day following such date; and (ii) in the case of the
Registrar or a Required Agent, such resignation shall not take effect until a
successor has been duly appointed consistently with Section 17(d) and 17(e) and
notice of such appointment has been given to the Holders.

         (b) The Issuer may (with the prior written approval of the Trustee)
revoke its appointment of any Agent by not less than 30 days' notice to such


                                      -14-
<PAGE>

Agent (with a copy, in the case of an Agent other than the Registrar, to the
Registrar); provided, however, that, in the case of the Registrar or any
Required Agent, such revocation shall not take effect until a successor has been
duly appointed consistent with Section 17(d) and 17(e) and previously approved
in writing by the Trustee and notice of such appointment has been given to the
Holders.

         (c) The appointment of any Agent shall terminate forthwith if (i) such
Agent becomes incapable of acting, (ii) a secured party takes possession, or a
receiver, manager or other similar officer is appointed, of the whole or any
part of the undertaking, assets and revenues of such Agent, (iii) such Agent
admits in writing its insolvency or inability to pay its debts as they fall due,
(iv) an administrator or liquidator of such Agent or the whole or any part of
the undertaking, assets and revenues of such Agent is appointed (or application
for any such appointment is made), (v) such Agent takes any action for a
readjustment or deferment of any of its obligations or makes a general
assignment or an arrangement or composition with or for the benefit of its
creditors or declares a moratorium in respect of any of its indebtedness, (vi)
an order is made or an effective resolution is passed for the winding-up of such
Agent or (vii) any event occurs which has an analogous effect to any of the
foregoing. If the appointment of the Registrar or any Required Agent is
terminated in accordance with the preceding sentence, the Issuer shall forthwith
appoint a successor in accordance with Section 17(d).

         (d) The Issuer may (with the prior written approval of the Trustee)
appoint a successor Registrar or Paying Agents and shall forthwith give notice
of any such appointment to the continuing Agents, the Holders and the Trustee,
whereupon the Issuer, the continuing Agents, and the additional or successor
Registrar, Principal Paying Agent, Paying Agent and the Trustee shall acquire
and become subject to the same rights and obligations between themselves as if
they had entered into an agreement in the form MUTATIS MUTANDIS of this
Agreement.

         (e) If the Registrar or any Required Agent gives notice of its
resignation in accordance with Section 17(a) and by the fifteenth day before the
expiry of such notice a successor has not been duly appointed in accordance with
Section 17(a), the Registrar or Required Agent may itself, following such
consultation with the Issuer as is practicable in the circumstances and with the
prior written approval of the Trustee, appoint as its successor any reputable
and experienced financial institution and give notice of such appointment to the
Issuer, the Trustee, the remaining Agents and the Holders, whereupon the Issuer,
the remaining Agents and such successor shall acquire and become subject to the


                                      -15-
<PAGE>

same rights and obligations between themselves as if they had entered into an
agreement in the form MUTATIS MUTANDIS of this Agreement.

         (f) Upon any resignation or revocation taking effect under Section
17(a) or Section 17(b) or any termination taking effect under Section 17(c), the
relevant Agent shall:

                  (1) be released and discharged from its obligations under this
         Agreement (save that it shall remain entitled to the benefit of and
         subject to Section 12(b), Section 14, this Section 17 and Section
         18(a)); PROVIDED that this clause shall not relieve the relevant Agent
         from any liability to the Issuer in respect of any matters prior to
         such resignation or revocation becoming effective;

                  (2) in the case of the Registrar, deliver to the Issuer and to
         its successor a copy, certified as true and up-to-date by an officer or
         authorised signatory of the Registrar, of the records maintained by it
         in accordance with Section 8; and

                  (3) forthwith (upon payment to it of any amount due to it in
         accordance with Section 12) transfer all moneys and papers (including
         any unissued Notes held by it hereunder and any documents held by it
         pursuant to Section 15) to its successor and, upon appropriate notice,
         provide reasonable assistance to its successor for the discharge of its
         duties and responsibilities hereunder.

         (g) If any Agent decides to change its Specified Office (which may only
be effected within the same city unless the prior written approval of the Issuer
and the Trustee has been obtained), it shall give notice to the Issuer (with a
copy to the other Agents) of the address of the new Specified Office stating the
date on which such change is to take effect, which date shall be not less than
30 days after the date of such notice. The Trustee shall at the expense of the
Issuer not less than 14 days prior to the date on which such change is to take
effect (unless the appointment of the relevant Agent is to terminate pursuant to
any of the foregoing provisions of this Section 17 on or prior to the date of
such change) give notice thereof to the Holders.

SECTION 18      INDEMNIFICATION

         (a) The Issuer shall indemnify and hold harmless each Agent, its
officers and employees from and against all actions, claims, demands, damages,
liabilities, losses, costs and expenses (including, without limitation,



                                      -16-
<PAGE>

legal fees and expenses and any applicable value added tax or similar tax)
relating to or arising out of actions or omissions in any capacity hereunder,
except such as may result from the wilful default, wilful misconduct, negligence
or bad faith of such Agent.

         (b) This Section 18 shall survive the payment in full of all
obligations under the Notes, whether by redemption or otherwise, and the
termination of this Agreement by the Issuer or any of the Agents.

SECTION 19      MERGER, CONSOLIDATION OR SALE OF BUSINESS BY ANY AGENT

         Any legal entity into which any Agent or the Trustee may be merged,
converted or consolidated, or any legal entity resulting from any merger,
conversion or consolidation to which any Agent, or, as the case may be, the
Trustee shall be a party shall, to the extent permitted by applicable law, be
the successor to such Agent or, as the case may be, the Trustee under this
Agreement without the execution of any document or any further act by the
parties hereto, whereupon the Issuer, the Trustee, the other Agents and such
successor shall acquire and become subject to the same rights and obligations
between themselves as if they had entered into an agreement in the form mutatis
mutandis of this Agreement. Each Agent (or its successor) is required to notify
the Issuer in the event that such Agent is merged with, converted into or
consolidated with any other legal entity.

SECTION 20      NOTICES

         Any notice or other communication given hereunder, or pursuant to the
Notes shall be in writing delivered in person, sent by letter or telecopy (with
confirmation of receipt) or to such other address or facsimile number as the
party to receive such notice may have previously specified:

         (1)      if to the Issuer, to it at:

                  Sanitec International S.A.
                  19-21 boulevard Prince Henri
                  L-1724 Luxembourg
                  RC Luxembourg 13 82 055

                  Attention:  Dr. Manuel Frias
                  Facsimile: +352-26 26 89-834

                  with a copy to:



                                      -17-
<PAGE>

                  Sanitec Oy
                  Mikonkatu 15A
                  00100 Helsinki, Finland

                  Attention:  Dr. Rainer S. Simon

         (2) if to an Agent, to it at the address or facsimile number specified
against its name in Exhibit 1 hereto (or, in the case of an Agent not originally
a party hereto, specified by notice to the parties hereto at the time of its
appointment) for the attention of the person or department therein specified and
with a copy to:

                  The Bank of New York
                  One Canada Square
                  London E14 5AL
                  United Kingdom

                  Attn:  Global Trust Services
                  Facsimile:  +44 (0) 20 7964 6399

         (3)      If to the New York Paying Agent, to it at;

                  The Bank of New York
                  101 Barclay Street
                  Floor 21 West
                  New York, NY 10286

         4)       if to the Trustee, to it at:

                  The Bank of New York
                  One Canada Square
                  London E14 5AL
                  United Kingdom

                  Attn:  Global Trust Services
                  Facsimile: +44 (0) 20 7964 6399

         All notices and communications (other than those sent to holders of
Global Notes or Definitive Registered Notes) shall be deemed to have been duly
given (i) at the time delivered by hand, if personally delivered; (ii) five
Business Days after being deposited in the mail, postage prepaid, if mailed;
(iii) when answered back, if telexed; (iv) when receipt acknowledged, if
telecopied; and the



                                      -18-
<PAGE>

next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.

         Any notice or communication to a Holder of one or more Global Notes or
Definitive Registered Notes will be mailed by first class mail, certified or
registered, return receipt requested, or by overnight air courier guaranteeing
next day delivery to its address shown on the register kept by the Registrar.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.

         All notices to the Holders (whilst any Notes are represented by one or
more Global Notes) shall be delivered to the Depositaries for communication to
entitled Participants. Any notice will be deemed to have been given on the date
of delivery to the Depositary. Alternatively, any notice shall be valid if
published in a leading newspaper having a general circulation in New York City
(which is expected to be the WALL STREET JOURNAL), a leading newspaper having a
general circulation in London (which is expected to be the FINANCIAL TIMES) and,
so long as the Notes are listed on the Luxembourg Stock Exchange and the rules
of such exchange shall so require, a newspaper having a general circulation in
Luxembourg (which is expected to be the LUXEMBURGER WORT). If publication as
provided above is not practicable, notice will be given in such other manner,
and shall be deemed to have been given on such date, as the Trustee may approve.

         Any notices and other communication hereunder shall be made in the
English language or shall be accompanied by a certified English translation
thereof. Any certified English translation shall be certified a true and
accurate translation by a professionally qualified translator or by some other
person competent to do so.

         The Principal Paying Agent hereby agrees to give the notices required
to be delivered by it pursuant to the Indenture.

SECTION 21      MODIFICATIONS AND WAIVERS

         The Issuer and the Trustee shall only agree to any amendment or
modification to this Agreement in compliance with the relevant provisions of the
Indenture.

SECTION 22      JUDGMENT CURRENCY

         The Issuer shall indemnify the Holders against any loss incurred, as a
result of any judgment or award in connection with the Notes, or Indenture being


                                      -19-
<PAGE>

expressed in a currency (the "Judgment Currency") other than Euros and as a
result of any variation as between (i) the spot rate of exchange used to
calculate the Judgment Currency in which such judgment or award is paid, and
(ii) the spot rate of exchange at which the indemnified party converts or could
have converted such Judgment Currency at the earliest practicable time after
such judgment or award is rendered and becomes final. The foregoing shall
constitute a separate and independent obligation of the Issuer and shall
continue in full force and effect notwithstanding any such judgment or order.
The term "spot rate of exchange" includes any premiums and costs of exchange
payable in connection with the purchase of, or conversion into, the relevant
currency

SECTION 23      RIGHTS OF THIRD PARTIES

         This Agreement does not create any right under the Contracts (Rights of
Third Parties) Act 1999 which is enforceable by any person who is not a party to
this Agreement.

SECTION 24      GOVERNING LAW; SUBMISSION TO JURISDICTION

         (a) This Agreement and the Notes, and the rights and duties of the
parties hereunder and thereunder, shall be governed by and construed in
accordance with English law (articles 86 to 94-8 of the Luxembourg law of 10th
August 1915 having been expressly waived).

         (b) The Issuer hereby irrevocably submits to the non-exclusive
jurisdiction of any English court over any suit, action or proceeding arising
out of or related to this Agreement or any Note. The Issuer irrevocably waives,
to the fullest extent permitted by law, any objection which it may have to the
laying of the venue of any such suit, action or proceeding brought in such a
court and any claim that any such suit, action or proceeding brought in such a
court has been brought in an inconvenient forum.

         (c) As long as any of the Notes remain outstanding, the Issuer will at
all times have an authorized agent in England, upon whom process may be served
in any suit, action or proceeding arising out of or relating to this Agreement
or any Note. Service of process upon such agent and written notice of such
service mailed or delivered to the Issuer shall, to the extent permitted by law,
be deemed in every respect effective service of process upon the Issuer in any
such suit, action or proceeding. The Issuer has appointed Twyford Bathrooms, as
its initial authorized agent upon which all writs and processed summonses may be
served in any suit, action or proceeding brought in connection with this
Agreement or the Notes against the Issuer (or at such other address or at the
office of such other



                                      -20-
<PAGE>

authorized agent as the Issuer may designate by written notice to the Registrar
on behalf of the Agents).

SECTION 25      COUNTERPARTS

         This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. Such counterparts shall together
constitute but one and the same instrument.




                                      -21-
<PAGE>


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

                  The Issuer

                  SANITEC INTERNATIONAL S.A.

                  By:

                           Name:
                           Title:

                  By:

                           Name:
                           Title:

The provisions set out in Section 24 are hereby expressly agreed to by SANITEC
INTERNATIONAL S.A. for the purposes, INTER ALIA, of Article 1 of the Protocol
annexed to the Convention on jurisdiction and enforcement of judgments in civil
and commercial matters signed in Brussels on 27 September 1968.

For and on behalf of SANITEC INTERNATIONAL S.A.:

                _______________________

                _______________________


                  The Trustee

                  THE BANK OF NEW YORK

                           By:

                           Name:
                           Title:




                                      -22-
<PAGE>


                  The Registrar, the Principal Paying Agent and the New York
                  Paying Agent

                  THE BANK OF NEW YORK

                           By:

                           Name:
                           Title:


                  The Luxembourg Paying Agent

                  THE BANK OF NEW YORK (LUXEMBOURG) S.A.

                           By:

                           Name:
                           Title:


                  By:

                           Name:
                           Title:

The provisions set out in Section 24 are hereby expressly agreed to by The Bank
of New York (Luxembourg) S.A. for the purposes, INTER ALIA, of Article 1 of the
Protocol annexed to the Convention on jurisdiction and enforcement of judgments
in civil and commercial matters signed in Brussels on 27 September 1968.

For and on behalf of
THE BANK OF NEW YORK (LUXEMBOURG) S.A.:

                __________________________

                __________________________







                                      -23-
<PAGE>


                                    EXHIBIT 1

                         SPECIFIED OFFICES OF THE AGENTS

The Principal Paying Agent and Registrar:

The Bank of New York
One Canada Square
London E14 5AL
United Kingdom

Fax:              + 44 20 7964 6399

Attention:        Global Trust Services



The Luxembourg Paying Agent:

The Bank of New York (Luxembourg) S.A.
c/o The Bank of New York
One Canada Square
London E14 5AL
United Kingdom

Fax:              + 44 20 7964 6399

Attention:        Global Trust Services





The New York Paying Agent:

The Bank of New York
101 Barclay Street
Floor 21 West
New York, NY 10286





                                      -24-