EXHIBIT 4(b)

                    AMENDMENT TO LOAN AGREEMENT AND GUARANTY

    THIS AMENDMENT TO LOAN AGREEMENT AND GUARANTY is entered into as of
September 22, 1998 by and among Wellman, Inc., a Delaware corporation (the
"Borrower"), Prince, Inc., a Delaware corporation and wholly owned subsidiary
of the Borrower ("Prince"), Fleet National Bank, a national banking
association, in its capacity as agent for itself and the other Banks (the
"Agent") and the Banks.

                                 RECITALS

    WHEREAS, capitalized terms used in this Amendment to Loan Agreement and
Guaranty (the "Amendment") and not expressly defined herein shall have the
respective meanings assigned thereto in that certain Loan Agreement dated as
of February 8, 1995 among the Borrower, the Agent and the Banks, as amended
June 4, 1997 (the "Loan Agreement") or that certain Guaranty of Prince dated
as of February 8, 1995 whereby Prince guaranteed the Obligations of Borrower
under the Loan Agreement (the "Prince Guaranty"), whichever is applicable;

    WHEREAS, the Borrower, Prince, the Banks and the Agent desire to amend
the Loan Agreement and the Prince Guaranty as provided in this Amendment.

    NOW, THEREFORE, in consideration of the terms and conditions set forth
herein and for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by each of the parties hereto, the Borrower,
Prince, the Banks and the Agent hereby mutually agree as follows:

    Section 1.  Amendments.  Effective as of the date hereof, the Loan
Agreement is hereby amended as follows:

    (a)    Section 1.01 of the Loan Agreement is amended by deleting the
definition of "Borrowed Money" and inserting the following definition in
substitution therefor:

           "Borrowed Money" means with respect to any Person the aggregate
           amount, without duplication, of the following items as and to the
           extent reflected on such Person's consolidated balance sheet
           (exclusive of any such item only required to be disclosed in a
           note to such balance sheet) prepared in accordance with GAAP (any
           such balance sheet of the Borrower being hereinafter referred to
           as "Borrower's GAAP Balance Sheet"): (a) all obligations for
           borrowed money; (b) all Capitalized Lease Obligations; and (c) all
           obligations evidenced by bonds, debentures, the Notes, other
           promissory notes or other similar instruments.

    (b)    Section 1.01 of the Loan Agreement is amended by deleting the
           definition of "Lien" and inserting the following definition in
           substitution therefor:

<PAGE>
           "Lien" means any mortgage, lien, pledge, charge, security
           interest, conditional sale or other title retention agreement or
           other encumbrance of any nature whatsoever; however, Lien does
           not include any encumbrance relating to any Tax Reduction
           Agreement.

    (c)    Section 1.01 of the Loan Agreement is amended by deleting the
           definition of "Material Subsidiary" and inserting the following
           definition in substitution therefor:

           "Material Subsidiary" means Fiber, Prince, Wellman of Mississippi,
           Inc. and any Subsidiary of the Borrower, which owns a Principal
           Property, or any Subsidiary in which Borrower's share of the total
           Tangible Assets (after inter-company eliminations) of such
           Subsidiary exceeds fifteen percent (15%) of the Consolidated
           Tangible Assets of the Borrower as of the most recent quarter end.

    (d)    Section 1.01 of the Loan Agreement is amended by inserting the
           following definitions immediately after the definition of "P.M.":

           "Permitted Receivables Program" means any agreement of the
           Borrower or any of the Subsidiaries providing for sales, transfers
           or conveyances of accounts receivable purporting to be sales (and
           considered sales under GAAP) that do not provide, directly or
           indirectly, for recourse against the seller of such accounts
           receivable (or against any of such seller's Subsidiaries or
           Affiliates) by way of a guaranty or any other credit support
           arrangement, with respect to the amount of such accounts
           receivable (based on the financial condition or circumstances of
           the obligor thereunder), other than such limited recourse as is
           reasonable given market standards for transactions of a similar
           type, taking into account such factors as historical bad debt loss
           experience and obligor concentration levels.

           "Permitted Sale/Leaseback Transactions" means any sale and
           leaseback by the Borrower or any Subsidiary of any property if:
           (1) within 120 days after the effective date of the lease the
           Borrower or such Subsidiary, either (A) applies the net proceeds
           to the acquisition of another property of equal or greater fair
           market value or (B) applies the proceeds to the retirement of
           Indebtedness for Borrowed Money in an amount equal to the greater
           of (i) the net proceeds received by the Borrower and its
           Subsidiaries for the sale of the property leased, or (ii) the fair
           market value of the property leased within 90 days prior to the
           effective date of the lease, or (C) any combination of (A) and
           (B); (2) the lease has a term of not more than five years; (3) the
           Lien on any such property subject to such sale and leaseback would
           be permitted under Section 5.02(A); (4) the sale and leaseback is
           of the properties in connection with any Tax Reduction Agreement;

                                      2
<PAGE>
           (5) the sale and leaseback transaction is between the Borrower and
           a Subsidiary or between Subsidiaries; or (6) such lease is entered
           into within 360 days after the later of the acquisition,
           completion of construction or commencement of operation of such
           property; provided that any such sale and leaseback transaction
           pursuant to subsections (2), (3) and (6) above are permitted only
           if the amount of the net proceeds received in such transaction are
           applied to reduce the Indebtedness for Borrowed Money within ten
           (10) Business Days after the net proceeds are received; provided
           further, that the foregoing restriction regarding the use of
           proceeds for transactions pursuant to subsection (3) above shall
           only apply to transactions which create Liens that are permitted
           pursuant to Sections 5.02(A)(i), 5.02(A)(l) and 5.02(A)(p) of the
           Loan Agreement, as amended.

    (e)    Section 1.01 of the Loan Agreement is amended by inserting the
           following definition immediately after the definition of "Prince
           Guaranty":

           "Principal Property" means any manufacturing, processing,
           distribution, research, research and development, warehousing or
           principal administration facility (including, without limitation,
           land, fixtures and equipment) owned or leased by the Borrower or
           any Subsidiary (including any of the foregoing acquired or leased
           after the date of the Loan Agreement) unless the Board of
           Directors of the Borrower by Board Resolution and in good faith
           declares that such facility is not of material importance to the
           business conducted by the Borrower and its Subsidiaries taken as
           an entirety; provided, however, the Board of Directors may not
           make such a declaration regarding a facility and any such prior
           declaration shall be ineffective for the purposes of this
           definition if the net book value of the applicable facility is
           greater than fifteen percent (15%) of the Consolidated Tangible
           Assets of the Borrower as reflected on the consolidated balance
           sheet of the Borrower at the most recent quarter end.

    (f)    Section 1.01 of the Loan Agreement is amended by inserting the
           following language at the end of the definition of "Restricted
           Guaranty":

           "provided, further, that any guaranty or guaranties related to any
           Tax Reduction Agreement are excluded from this definition."

    (g)    Section 1.01 of the Loan Agreement is amended by inserting the
           following definition immediately after the definition of
           "Syndication Agent":

           "Synthetic Lease" means a transaction for the lease of property or
           assets designed to permit the lessee (i) to claim depreciation on
           such property or assets under U.S. tax law and (ii) to treat such
                                      3
<PAGE>
           lease as an operating lease or not to reflect the property or
           assets on the lessee's balance sheet under GAAP.

    (h)    Section 1.01 of the Loan Agreement is amended by inserting the
           following definition immediately after the definition of "Tangible
           Assets":

           "Tax Reduction Agreement" means (1) any Fee-in-Lieu-of-Tax
           Agreement (as defined on Exhibit 1 to that certain Amendment to
           Loan Agreement and Guaranty among Borrower, Prince and the Banks
           named therein dated as of September 22, 1998 (the "Amendment")
           attached hereto and made a part hereof) of Borrower or its
           Subsidiaries as permitted under applicable state or municipal law
           or any other arrangement providing similar benefits; or (2) any
           Cross Border Lease Agreement (as defined on Exhibit 2 to the
           Amendment attached hereto and made a part hereof) which is
           designed to permit depreciation of the same property to be claimed
           under the tax laws of two different countries.

    (i)    Section 5.02(A) of the Loan Agreement is hereby amended by
           deleting "Borrower or any Subsidiary" at the end of subsection
           5.02(A)(h) and by adding the following language to the end of such
           subsection:

           "Borrower and its Subsidiaries taken as a whole"

    (j)    Section 5.02(A)(i) of the Loan Agreement is hereby amended by
           deleting the reference to "Consolidated Stockholders' Equity" and
           inserting in its stead "Consolidated Tangible Assets":

    (k)    Section 5.02(A) of the Loan Agreement is hereby amended by adding
           the following language after subsection 5.02(A)(j):

               (k)    any Liens existing on properties or assets prior to the
                      acquisition thereof by the Borrower or any Subsidiary
                      (including by way of merger or consolidation), provided
                      that (x) such Lien is not created in contemplation of
                      or in connection with such acquisition and (y) such
                      Lien does not apply to any other property or assets of
                      the Borrower or any Subsidiary;

               (l)    Liens upon any property acquired, constructed or
                      improved by the Borrower or any Subsidiary which are
                      created or incurred within 360 days of the later of the
                      acquisition, completion of construction or commencement
                      of operation of the property to secure or provide for
                      the payment of up to the purchase price of such
                      property or the cost of such construction or
                      improvement, including carrying costs (but no other
                      amounts), provided that any such Lien shall not
                                     4
<PAGE>
                      apply to any other property of the Borrower or any
                      Material Subsidiary;

               (m)    Liens on the property or assets of any Subsidiary in
                      favor of the Borrower or any Material Subsidiary;

               (n)    extensions, renewals or replacements of Liens referred
                      to in clauses (a) through (m) above, provided that any
                      such extension, renewal or replacement Lien shall be
                      limited to the property or assets covered by the Lien
                      extended, renewed or replaced and that the obligations
                      secured by any such extension, renewal or replacement
                      Lien shall be in an amount not greater than the amount
                      of the obligations secured by the Lien extended,
                      renewed or replaced;

               (o)    Liens to the extent that they are less than
                      $100,000,000 in the aggregate arising in connection
                      with all Permitted Receivables Programs (to the extent
                      the sale by the Borrower or the applicable Material
                      Subsidiary of its accounts receivable is deemed to give
                      rise to a Lien in favor of the purchaser thereof in
                      such accounts receivable or the proceeds thereof); and

               (p)    Liens upon any property or assets of the Borrower and
                      its Subsidiaries on property subject to a Synthetic
                      Lease or any right of access or other non-financial
                      encumbrance relating thereto.

    (l)    Section 5.01(K) of the Loan Agreement is hereby amended to read as
           follows:

           (K)    Leverage Ratio.  Maintain at the end of each of Borrower's
           fiscal quarters a Leverage Ratio of not greater than .55 to 1.0;
           provided, that solely for purposes of calculating Borrower's
           compliance with this covenant, Adjusted Indebtedness shall exclude
           any Tax Reduction Agreement transactions entered into by the
           Borrower or any Subsidiary except to the extent that any such
           transaction is recorded as a liability on the consolidated balance
           sheet of the Borrower and there shall be subtracted from Adjusted
           Indebtedness the excess of (A) Borrower's Cash Equivalent
           Investments at such date over (B) the sum of (i) $10,000,000 and
           (ii) the amount of federal income taxes that would be payable (if
           any) if Borrower's Cash Equivalent Investments held outside the
           United States were repatriated to the United States at the end of
           such quarter, and taxed at the Assumed Rate.  For purposes of this
           Section 5.01(K) the term "Assumed Rate" means the greater of zero
           or the difference between (a) the highest federal income tax rate


                                      5
<PAGE>
           in the United States applicable to domestic corporations and (b)
           the highest income tax rate applicable to Borrower or its
           Subsidiaries, as appropriate, on Cash Equivalent Investments in
           the jurisdiction in which such Cash Equivalent Investments are
           held at the end of such quarter.

    (m)    Section 5.02(B) of the Loan Agreement is hereby amended to read as
           follows:

           (B)    Dissolution, etc.  (i) Dissolve, liquidate, wind up, except
           for dissolution of any Subsidiary other than a Material
           Subsidiary, (ii) merge or consolidate with any Person if (a)
           Borrower is not the surviving corporation or (b) after any merger
           or consolidation, a Default or Event of Default shall have
           occurred, (iii) except pursuant to a Tax Reduction Agreement or a
           Permitted Sale/Leaseback Transaction, sell, assign, lease or
           otherwise dispose of or permit the disposal of or turn over the
           management of (whether in one transaction or in a series of
           related transactions) all or substantially all of its assets
           except to Borrower or to any Subsidiary, or (iv) except pursuant
           to a Tax Reduction Agreement or a Permitted Sale/Leaseback
           Transaction, sell (whether in one transaction or in a series of
           related transactions) any asset material to the Borrower or to the
           Borrower and the Subsidiaries taken as a whole (whether now owned
           or hereafter acquired and whether any such asset is leased back on
           an operating lease basis or as a Capitalized Lease Obligation but
           excluding transactions of the type described in paragraph 2 of
           Exhibit H); provided that such restriction shall not apply (x) to
           any such assets which are promptly replaced with assets of
           substantially like kind, value and usefulness which are owned by
           the Borrower or a Subsidiary and (y) to any transaction to the
           extent that the aggregate book value of Tangible Assets sold
           (measured at the time of such transaction in question) of the
           assets involved in any such transaction does not exceed ten
           percent (10%) of Consolidated Tangible Assets.

    (n)    Section 10 of the Prince Guaranty is hereby amended to read as
           follows:

    10.        The Guarantor further covenants and agrees that during such
           time as this Guaranty is in effect the Guarantor will not, without
           the prior written consent of the Agent, incur any Indebtedness for
           Borrowed Money to any third party except Indebtedness for Borrowed
           Money which would be permitted to exist under the terms of the
           Loan Agreement.  In the event of any breach of said covenants and
           agreements, all Obligations, regardless of their terms, shall at
           the Agent's election be deemed for the purposes of this Guaranty
           to have become matured, and, at the Agent's election, the
           Guarantor shall promptly pay to the Agent the entire amount of the

                                      6
<PAGE>
           Obligations, and the Agent may take any action deemed necessary or
           advisable to enforce this Guaranty.

    (o)    Section 15 of the Prince Guaranty is hereby amended to read as
           follows:

    15.        The Guarantor hereby covenants and agrees to and with the
           Agent and each of the Lenders and their successors and assigns
           that the Guarantor shall not engage in any business other than (i)
           holding of the equity interests of Fiber and other Persons, (ii)
           receipt of dividends and distributions on such interests, (iii)
           payment of dividends and/or making loans to the Principal Debtor,
           (iv) collection of principal of and interest on such loans, (v)
           engaging in intercompany loans and transactions, (vi) acquiring,
           holding, managing and licensing intangible assets, and (vii)
           intercompany money management transactions.  The Guarantor shall
           maintain its own books and records, its separate corporate
           identity and conduct itself in all respects as a separate
           corporation observing customary corporate formalities in
           connection therewith.

    Section 2.  Representations and Warranties.  The Borrower and Prince
hereby represent and warrant that (i) they have full power and authority to
execute and deliver this Amendment and to perform their respective
obligations hereunder, (ii) each has taken all corporate action necessary for
the execution and delivery by it of this Amendment and the performance by it
of its obligations hereunder, (iii) this Amendment constitutes a valid and
binding obligation of each enforceable against each in accordance with its
terms except to the extent enforceability may be subject to bankruptcy,
insolvency, moratorium and other similar law affecting the rights of
creditors generally or the application of principles of equity, whether in an
action at law or proceeding in equity, (iv) all of the representations and
warranties of the Borrower contained in the Loan Agreement, as amended, are
materially true and correct as of the date hereof, except to the extent (a)
they expressly relate to an earlier date, (b) they relate to the
representation contained in Section 4.01(O), or (c) as otherwise reflected in
the Borrower's most recent 10K, and (v) no Default or Event of Default has
occurred and is continuing on and as of the date hereof.

    Section 3.  Reference to and Effect Upon the Loan Agreement and Prince
Guaranty.

    3.1  The Loan Agreement and Prince Guaranty, as specifically amended
hereby, is hereby ratified, confirmed and approved and shall remain in full
force and effect.

    3.2  The execution, delivery and effectiveness of this Amendment shall
not operate as a waiver of any right, power or remedy of the Agent or any
Bank under the Loan Agreement, nor constitute an amendment of any provision

                                      7
<PAGE>
of the Loan Agreement, except as specifically set forth herein.  Upon the
effectiveness of this Amendment (i) each reference in the Loan Agreement to
"this Agreement", "hereunder", "hereof", "herein" or words of similar import
shall mean and be a reference to the Loan Agreement as amended by this
Amendment; (ii) each reference in any Note or Related Document to the Loan
Agreement shall mean and be a reference to the Loan Agreement as amended by
this Amendment, and (iii) each reference in the Prince Guaranty to "this
Guaranty", "hereunder", "hereof", "herein" or words of similar import shall
mean and be a reference to the Prince Guaranty as amended by this Amendment.

    Section 4.  Governing Law.  This Amendment shall be governed by and
construed in accordance with the laws of the State of New York without regard
to its conflict of laws provisions.

    Section 5.  Headings.  Article and Section headings in this Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose.

    Section 6.  Counterparts.  This Agreement may be executed and delivered
in any number of counterparts each of which shall be deemed an original, and
this Agreement shall be effective when at least one counterpart hereof has
been executed by each of the parties hereto.

    IN WITNESS WHEREOF, the parties hereto have caused this Amendment to Loan
Agreement and Guaranty to be executed as a sealed instrument by their
respective officers thereunto duly authorized as of the date first written
above.

                                 WELLMAN, INC.


                                 By:
                                 Name:   Audrey Goodman
                                 Title:     Assistant Treasurer

                                 PRINCE, INC.


                                 By:
                                 Name:   Audrey Goodman
                                 Title:     Treasurer

                                 FLEET NATIONAL BANK, as Agent and as a Bank


                                 By:
                                 Name:
                                 Title:


                                    8
<PAGE>
                                 BANK OF AMERICA NT&SA, as successor by
                                 merger to Bank of America Illinois


                                 By:
                                 Name:
                                 Title:

                                 WACHOVIA BANK OF GEORGIA, N.A., as Co-Lead
                                 and as a Bank


                                 By:
                                 Name:
                                 Title:

                                 BANK OF NOVA SCOTIA


                                 By:
                                 Name:
                                 Title:

                                 THE BANK OF TOKYO TRUST COMPANY


                                 By:
                                 Name:
                                 Title:

                                 CIBC, INC.


                                 By:
                                 Name:
                                 Title:

                                 THE CHASE MANHATTAN BANK, as successor by
                                 merger to The Chase Manhattan Bank, N.A.


                                 By:
                                 Name:
                                 Title:






                                      9
<PAGE>
                                 THE CHASE MANHATTAN BANK, as successor by
                                 merger to Chemical Bank New Jersey, N.A.


                                 By:
                                 Name:
                                 Title:

                                 FIRST UNION BANK, as successor to First
                                 Fidelity Bank, N.A.


                                 By:
                                 Name:
                                 Title:

                                 THE FUJI BANK, LIMITED


                                 By:
                                 Name:
                                 Title:

                                 ISITUTO BANCARIO SAN PAULO DI TORINO SPA


                                 By:
                                 Name:
                                 Title:

                                 KREDIETBANK NV


                                 By:
                                 Name:
                                 Title:

                                 MELLON BANK, N.A.


                                 By:
                                 Name:
                                 Title:

                                 PNC BANK, NATIONAL ASSOCIATION, successor by
                                 merger to Midlantic Bank, N.A.

                                 By:
                                 Name:
                                 Title:
                                     10
<PAGE>
                                 CITIBANK, N.A., as successor to Toronto
                                 Dominion (New York), Inc.


                                 By:
                                 Name:
                                 Title:

                                 BANCA MONTE dei PASCHI di SIENA S.p.A.


                                 By:
                                 Name:
                                 Title:




































                                   11
<PAGE>
                                Exhibit I

                       Fee-in-Lieu-of-Tax Agreements
                       -----------------------------

A "Fee in Lieu-of-Tax Agreement" means any transaction, agreement or
arrangement which:

     (1) is between the Borrower and/or a Subsidiary of the Borrower and a
     third party that reduces the tax obligation of such entity, other than
     income tax obligations (i.e. property, sales, use, and contractor's)
     which would have been payable without such transaction, agreement or
     arrangement;

     (2) does not increase the Borrower's Indebtedness for Borrowed Money,
     except to the extent of the costs of entering into the transaction, on
     the date the transaction, agreement or arrangement is executed; and

     (3) does not provide additional funding (except for the tax savings)
     whether in the form of a lease or otherwise for the Borrower's and/or a
     Subsidiary's construction or use of an asset.
---------------------------------------------------------
For illustrative purposes only and not as part of the definition of Fee-in-
Lieu-of-Tax Agreement, the form of fee-in-lieu-of-tax agreement, the "deemed"
cash transfers, and the steps taken at the different stages of the
transaction that the Borrower has in place currently in South Carolina are
summarized as follows:

South Carolina Fee-in-Lieu-of Tax Agreement Summary
---------------------------------------------------

"Deemed" Cash Transfers to Establish Fee-in-Lieu Assets with Darlington
County:

1.  Borrower funds asset additions by Fiber;
2.  Borrower borrows money to buy Darlington County Bonds. (Bond amount is
    equal to annual fee-in-lieu asset additions by Fiber);
3.  Darlington County issues Bonds;
4.  Borrower buys Bonds;
5.  Darlington County buys assets from Fiber with Bond money received from
    Borrower;
6.  Fiber transfers title to its "fee-in-lieu" assets to Darlington County
    and enters into a leaseback agreement with Darlington County;
7.  Fiber repays loan from Borrower, Inc. (see #1 above) with sale proceeds
    from Darlington County;
8.  Borrower repays bank borrowing associated with Bond purchase in #2 above.




                                      12
<PAGE>
                            Exhibit 1: continued
                            --------------------

Actual and "Deemed" Annual Cash Transfers Associated with Lease and Bonds:
--------------------------------------------------------------------------

Annually Fiber pays lease payments to Darlington County.  The lease payments
include the following:  (1) actual cash for an amount "in-lieu" of property
taxes (this amount is less than Fiber would have paid for property taxes if
it had not received this incentive); and (2) Fiber is "deemed" to pay
Borrower 6% interest on the assets covered under the "fee-in-lieu" (this is
equal to the Bond interest owed by Darlington County to Borrower and the
documents allow that this amount can be paid directly by Fiber to Borrower).
Since no cash is transferred between Fiber and Borrower there is a deemed
transfer by Borrower to Fiber which is either a loan or a contribution to
capital.

"Deemed" Cash Transfers at the End of the Fee-In-Lieu Agreement:
----------------------------------------------------------------

1.  Borrower borrows funds from a bank and lends them to Fiber to enable
    Fiber to buy back its "fee-in-lieu" assets;
2.  Fiber buys back its "fee-in-lieu" assets from Darlington County with the
    money Borrower has lent it;
3.  Darlington County returns title to the "fee-in-lieu" assets to Fiber;
4.  Darlington County pays Borrower the cash it receives from Fiber to buy
    back its Bonds;
5.  Borrower returns the Bonds to Darlington County for cancellation;
6.  Borrower repays the bank for money it borrowed and lent to Fiber (see #1
    above).


We are currently attempting to negotiate similar agreements in other states
and would expect that in principal they would reduce various taxes and not
subject the Borrower to any funding risk.  In general, if these transactions
were terminated, the Borrower or its Subsidiaries would not be required to
borrow additional funds or enter into additional financing transactions.













                                     13
<PAGE>
                                 Exhibit 2
                                 ---------

                       Cross Border Lease Agreement
                       ----------------------------

A "Cross Border Lease Agreement" is defined as an agreement, arrangement or
transaction (1) which is designed to permit depreciation of the same property
to be claimed under the tax laws of two or more different countries; and (2)
which at the date such agreements, arrangements or transactions are entered
into neither (a) increases the Indebtedness for Borrowed Money by more than
$10 million, nor (b) provides current funding from a transaction which is an
operating lease in accordance with GAAP by more than $10 million.


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

For illustrative purposes only, and not as part of the definition of Cross
Border Lease Agreement, the following outline describes the basic steps of
one type of generic Cross Border Lease transaction:

1)  A U.S. entity enters into a transaction with a foreign investor.  The
    foreign investor generally creates a separate foreign entity to
    participate in the transaction.   The transaction involves the U.S entity
    transferring property to the newly formed foreign entity and leasing it
    back.  Depending on the legal structure the transaction may be
    characterized as a financing for GAAP and U.S. income tax purposes or as
    a payment of an upfront cash benefit.  Thus the U.S. entity is treated as
    the owner of the property and is entitled to depreciation deductions.
    The transaction is characterized as a purchase and lease for foreign tax
    purposes.  Therefore the foreign investor also claims depreciation on the
    property.  The net present value of the foreign investor's after tax cash
    savings, a result of reduced foreign taxes due to depreciation
    deductions, is divided between the U.S. entity and the foreign investor.
    Note that in calculating the benefit to the foreign investor the upfront
    tax benefits received must be reduced by taxes paid at the end of the
    transaction when the foreign entity "sells" the property.  This gain may
    be subject to lower (capital gains) tax rates.

2)  Assuming the transaction is not legally defeased and cash is paid for the
    asset on inception, the basic payments associated with the transaction,
    as well as their character, are as follows:








                                     14
<PAGE>
                         Exhibit 2: continued
                         --------------------


     Transaction                U.S. Entity              Foreign Entity
     -----------                -----------              ---------------
Beginning of            Loan from foreign entity      Purchase of property
transaction payment     for GAAP and U.S. income      from U.S. entity for
(cash from foreign      tax purposes.                 income tax purposes.
entity to U.S. entity).

Periodic payments       Interest payments on          Lease payments for
(cash from U.S.         loan for GAAP and U.S.        income tax purposes
entity to foreign       income tax purposes.
entity).

End of transaction      Repayment of loan from        Sale of property back
payment (generally      foreign entity for GAAP       to U.S. entity for
cash from U.S. entity   and U.S. income tax           income tax purposes.
to foreign entity).     purposes.


Modifications of this structure as well as different forms of the transaction
may be utilized which impact the flow of funds.

3)  Assuming the U.S. entity defeases some or all of its obligations under
    the lease, as is often the case the U.S. entity will generally deposit
    funds with a highly-rated financially sound bank operating in the foreign
    investor's country.  The total amount defeased will not be greater than
    and will generally approximate the net present value of the U.S. entity's
    periodic payments as well as the net present value of the end of
    transaction payment.  The defeasance may be legal or economic.  On a
    portion of the transaction which is defeased the U.S. entity may be
    subject to secondary liability with respect to the defeased obligations
    in the event of default by the defeasance bank.

4)  In these transactions if the U.S. entity terminates the transaction
    early, e.g. because of casualty in respect of the property involved in
    the transaction, there is an obligation as of that date to restore the
    foreign investor to its anticipated position.  This contingent obligation
    may require credit support such as a letter of credit or other
    arrangements.  Generally, both parties to the transaction bear the tax
    risk of their respective jurisdictions.

5)  As part of the documentation for the transaction, the U.S. entity will
    generally be required to enter into certain agreements regarding the
    operation of the assets subject to the lease as well as agreements
    associated with various assets at the site that support the assets
    subject to the lease.  Additional agreements that may be executed include
    access right agreements or service agreements.
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These transactions commonly involve transportation equipment and historically
provide benefits to both parties to the transaction.  Any contingent
liabilities associated with these transactions are generally remote and no
liability is normally recorded in the U.S. entity's financial statements.














































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