Exhibit 2




               _________________________________________________

                                 [e]227,000,000
                                TERM FACILITIES
                        AND REVOLVING CREDIT AGREEMENT
               _________________________________________________


                             DATED 3 FEBRUARY 2004


                                      FOR


                         SGL CARBON AKTIENGESELLSCHAFT
                  AS THE COMPANY AND AS AN ORIGINAL BORROWER


                            BAYERISCHE LANDESBANK
                   CREDIT SUISSE FIRST BOSTON INTERNATIONAL
                               DEUTSCHE BANK AG
                                      AND
                        DRESDNER KLEINWORT WASSERSTEIN
                          AS MANDATED LEAD ARRANGERS



                         DEUTSCHE BANK LUXEMBOURG S.A.
                     AS FACILITY AGENT AND SECURITY AGENT


                                     WITH


                   CREDIT SUISSE FIRST BOSTON INTERNATIONAL
                            AS DOCUMENTATION AGENT








                               BAKER & MCKENZIE
                                   FRANKFURT


<PAGE>


                                   CONTENTS

Clause                                                                     Page

                                   SECTION 1

                                INTERPRETATION

1.    DEFINITIONS AND INTERPRETATION........................................  1

                                   SECTION 2

                                THE FACILITIES

2.    THE FACILITIES........................................................  1
3.    PURPOSE...............................................................  1
4.    CONDITIONS OF UTILISATION.............................................  1

                                   SECTION 3

                                  UTILISATION

5.    UTILISATION...........................................................  1
6.    CHANGE OF CURRENCY.................................................... 41

                                   SECTION 4

                    REPAYMENT, PREPAYMENT AND CANCELLATION

7.    REPAYMENT.............................................................  1
8.    COMPANY'S LIABILITIES IN RELATION TO THE LETTER OF CREDIT............. 43
9.    PREPAYMENT AND CANCELLATION...........................................  1

                                   SECTION 5

                             COSTS OF UTILISATION

10.   INTEREST..............................................................  1
11.   INTEREST PERIODS AND THE TERM.........................................  1
12.   CHANGES TO THE CALCULATION OF INTEREST................................  1
13.   FEES..................................................................  1

                                   SECTION 6

                        ADDITIONAL PAYMENT OBLIGATIONS

14.   TAX GROSS UP AND INDEMNITIES..........................................  1
15.   INCREASED COSTS.......................................................  1
16.   OTHER INDEMNITIES.....................................................  1
17.   MITIGATION BY THE LENDERS.............................................  1
18.   COSTS AND EXPENSES....................................................  1

                                   SECTION 7

                                   GUARANTEE

19.   GUARANTEE AND INDEMNITY...............................................  1

                                   SECTION 8

              REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

20.   REPRESENTATIONS....................................................... 72
21.   INFORMATION UNDERTAKINGS..............................................  1
22.   FINANCIAL COVENANTS...................................................  1


<PAGE>



23.   GENERAL UNDERTAKINGS..................................................  1
24.   EVENTS OF DEFAULT.....................................................107

                                   SECTION 9

                              CHANGES TO PARTIES

25.   CHANGES TO THE LENDERS................................................  1
26.   CHANGES TO THE OBLIGORS...............................................  1

                                  SECTION 10

                             THE FINANCE  PARTIES

27.   ROLE  OF  THE  FACILITY  AGENT, THE  SECURITY AGENT, THE DOCUMENTATION
      AGENT, THE MANDATED LEAD ARRANGERS AND  THE  COMPANY  AS  AGENT OF THE
      OBLIGORS..............................................................  1
28.   THE LENDERS, THE ISSUING BANKS AND THE SUFACILITY BANKS...............124
29.   CONDUCT OF BUSINESS BY THE FINANCE PARTIES............................  1
30.   SHARING AMONG THE LENDERS AND THE ISSUING BANKS.......................  1

                                  SECTION 11

                                ADMINISTRATION

31.   PAYMENT MECHANICS.....................................................  1
32.   SET-OFF...............................................................  1
33.   NOTICES...............................................................  1
34.   CALCULATIONS AND CERTIFICATES.........................................  1
35.   PARTIAL INVALIDITY....................................................  1
36.   REMEDIES AND WAIVERS..................................................  1
37.   AMENDMENTS AND WAIVERS................................................  1
38.   COUNTERPARTS..........................................................  1

                                  SECTION 12

                         GOVERNING LAW AND ENFORCEMENT

39.   GOVERNING LAW.........................................................  1
40.   ENFORCEMENT...........................................................  1

Schedules

SCHEDULE 1 The Original Parties.............................................  1
SCHEDULE 2 Conditions Precedent and Conditions Subsequent...................  1
SCHEDULE 3 Requests.........................................................  1
SCHEDULE 4 Mandatory Cost Formula...........................................  1
SCHEDULE 5 Form of Transfer Certificates....................................  1
SCHEDULE 6 Form of Accession Letter.........................................  1
SCHEDULE 7 Form of Compliance Certificate...................................  1
SCHEDULE 8 Existing Security................................................  1
SCHEDULE 9 LMA Form of Confidentiality Undertaking..........................  1
SCHEDULE 10 Timetables......................................................  1
SCHEDULE 11 Form of Security Trust Agreement................................  1
SCHEDULE 12 Borrowers and their Allocations.................................  1
SCHEDULE 13 Current Material Subsidiaries...................................  1
SCHEDULE 14 Form of Letter of Credit........................................  1
SCHEDULE 15 Existing Competition Law Proceedings and Anti-Trust Lawsuits....  1
SCHEDULE 16 Existing Intra-Group Loans......................................  1


<PAGE>


SCHEDULE 17 Existing Indebtedness...........................................  1
SCHEDULE 18 Form of Intercreditor Agreement.................................  1


<PAGE>


THIS AGREEMENT is dated 3 February 2004 and made between:

(1)   SGL CARBON AKTIENGESELLSCHAFT, Wiesbaden (the "COMPANY");

(2)   THE  COMPANY and THE COMPANIES listed in Part I of Schedule 1 as original
      borrowers (the "ORIGINAL BORROWERS");

(3)   THE COMPANIES  listed in Part I of Schedule 1 as original guarantors (the
      "ORIGINAL GUARANTORS");

(4)   BAYERISCHE LANDESBANK, CREDIT SUISSE FIRST BOSTON INTERNATIONAL, DEUTSCHE
      BANK  AG  and DRESDNER  KLEINWORT  WASSERSTEIN,  THE  INVESTMENT  BANKING
      DIVISION OF  DRESDNER  BANK  AG as Mandated Lead Arrangers (the "MANDATED
      LEAD ARRANGERS");

(5)   THE FINANCIAL INSTITUTIONS listed  in  Part  II  of Schedule 1 as lenders
      (the "ORIGINAL LENDERS");

(6)   DEUTSCHE BANK LUXEMBOURG S.A. as Facility Agent and  Security  Agent  for
      the Lenders (the "FACILITY AGENT" and the "SECURITY AGENT"); and

(7)   CREDIT  SUISSE  FIRST  BOSTON  INTERNATIONAL  as Documentation Agent (the
      "DOCUMENTATION AGENT").



IT IS AGREED as follows:

                                   SECTION 1

                                INTERPRETATION

1.    DEFINITIONS AND INTERPRETATION

1.1   DEFINITIONS

      In this Agreement:

      "ACCESSION  LETTER"  means  a Borrower Accession Letter  or  a  Guarantor
      Accession Letter and "ACCESSION LETTERS" shall be construed accordingly.

      "ACQUISITION" means:

      (i)    the purchase, subscription  for or other acquisition of any shares
             (or   other   securities   or  any  interest   therein)   in,   or
             incorporation, formation or organisation of, any other company; or

      (ii)   the  purchase  or other acquisition  of  any  assets  or  (without
             limitation to any of the foregoing) acquisition of any business or
             interest therein.

      "ADDITIONAL BORROWER" means  any  Material  Subsidiary  (other  than  the
      Issuer)  that becomes an Additional Borrower in accordance with Clause 26
      (Changes to the Obligors).

      "ADDITIONAL EU COMPETITION LAW LIABILITIES" means the fine imposed on the
      Company or  any  Group  Member  by  the  competition  directorate  of the
      European  Commission  in the



                                       1

<PAGE>


      amount  of   [e]23,600,000   in  relation  to  the  EU  Competition   Law
      Proceedings,  listed on Schedule 15 (Existing Competition Law Proceedings
      and Anti-Trust Lawsuits), No. 3.

      "ADDITIONAL GUARANTOR" means a  company  (other  than  the  Issuer)  that
      becomes an Additional Guarantor in accordance with Clause 26 (Changes  to
      the Obligors).

      "ADDITIONAL  OBLIGOR"  means  an  Additional  Borrower  or  an Additional
      Guarantor.

      "ADMINISTRATIVE AGENT" means Credit Suisse First Boston as administrative
      agent under the US Term Loan Agreement.

      "AFFILIATE" means, in relation to any person, a Subsidiary of that person
      or  a  Holding  Company  of  that person or any other Subsidiary of  that
      Holding Company.

      "ALLOCATION" means in relation  to each Borrower, the amount set opposite
      its name under the heading "Amount  of  such  Borrower's  Allocation"  in
      Schedule  12  (Borrowers and their Allocations), being the maximum amount
      of Term Facility  A,  Term  Facility B, Term Facility C and the Revolving
      Credit Facility that may be drawn down by that particular Borrower.

      "AUTHORISATION" means an authorisation,  consent,  approval,  resolution,
      licence, exemption, filing or registration.

      "AVAILABILITY PERIOD" means:

      (a)    in  relation  to  Term Facility A and Term Facility C, the  period
             from and including  the  Signing  Date  up  to  and  including  23
             February 2004;

      (b)    in  relation to Term Facility B, the period from and including the
             Signing  Date up to and including the date occurring one (1) Month
             prior to the  Termination  Date applicable to the Term Facility B;
             provided that the Availability  Period  for  Term Facility B shall
             end  upon  the  Utilisation  of  both  Letters of Credit  for  the
             Original EU Competition Law Liabilities; and

      (c)    in relation to the Revolving Credit Facility,  the period from and
             including the Signing Date up to and including the  date occurring
             one  (1)  Month  prior to the Termination Date applicable  to  the
             Revolving Credit Facility.

      "AVAILABLE COMMITMENT" means  in  relation  to  a  Facility,  a  Lender's
      Commitment  under that Facility minus the amount of its participation  in
      the Letters of  Credit  and/or minus the Euro Amount of its participation
      in any Revolving Credit Facility  Loans  and/or minus the amount in Euros
      of its participation in any amount outstanding  under  the  Term Facility
      Loans; and in relation to any proposed Utilisation, means that difference
      adjusted as follows:

      (a)    by  subtracting therefrom the amount of its participation  in  any
             Loans  (and  subtracting  therefrom the Euro Amount in the case of
             the Revolving Credit Facility)  that  are due to be made or issued
             under  that Facility on or before the proposed  Utilisation  Date;
             and

      (b)    in relation  to  the  Revolving  Credit  Facility  only, by adding
             thereto  the  Euro  Amount  of its participation in any  Revolving
             Credit Facility Loans that are due to be repaid or prepaid (or, if
             any Revolving Credit Facility  Loan is due to be repaid or

                                       2

<PAGE>
             prepaid  in part,  the Euro  Amount of its  participation  in that
             part) on or before the proposed Utilisation Date.

      "AVAILABLE FACILITY" means, in relation to  a Facility, the aggregate for
      the time being of each Lender's Available Commitment  in  respect of that
      Facility.

      "BAFIN" means Bundesanstalt f{u"}r Finanzdienstleistungsaufsicht.

      "BASE FINANCIAL STATEMENTS" means:

      (a)    the  consolidated  financial  statements  of  the  Group  for  the
             financial year ended 31 December 2002 prepared by the Company  and
             audited by BDO; and

      (b)    the  unaudited  consolidated  interim  financial statements of the
             Company as of and for the nine months ended 30 September 2003.

      "BDO"   means   Deutsche   Warentreuhand    AG   -   Wirtschaftsprufungs-
      gesellschaft.

      "BORROWER" means each Original Borrower and an Additional Borrower unless
      it  has ceased to be a Borrower in accordance with Clause 26 (Changes  to
      the Obligors).

      "BORROWER  ACCESSION  LETTER"  means a document substantially in the form
      set out in Part I of Schedule 6 (Form of Accession Letter).

      "BREAK COSTS" means the amount (if any) by which:

      (a)    the interest which a Finance  Party  should  have received for the
             period  from  the  date  of  receipt  of all or any  part  of  its
             participation  in a Loan or Unpaid Sum to  the  last  day  of  the
             current Interest  Period or Term in respect of that Loan or Unpaid
             Sum, had the principal  amount or Unpaid Sum received been paid on
             the last day of that Interest Period or Term,

      exceeds:

      (b)    the amount which that Finance  Party  would  be  able to obtain by
             placing  an  amount  equal to the principal amount or  Unpaid  Sum
             received by it on deposit  with  a  leading  bank  in the Relevant
             Interbank  Market  for  a  period  starting  on  the Business  Day
             following receipt or recovery and ending on the last  day  of  the
             current Interest Period or Term.

      "BRIDGE  ARRANGERS"  means  Credit  Suisse First Boston International and
      Deutsche Bank AG London.

      "BRIDGE LENDERS" means the lenders making  available the Bridge Loan from
      time to time.

      "BRIDGE LOAN" means the loan agreement to be entered into by, inter alia,
      the Company as borrower and Credit Suisse First  Boston International and
      Deutsche  Bank  AG  London as lenders providing for bridge  loans  in  an
      amount of up to [e]270,000,000, as amended from time to time.

      "BRIDGE LOAN AGENT" means  Credit  Suisse  First Boston International, as
      agent with respect to the Bridge Loan.

                                       3

<PAGE>


      "BRIDGE  LOAN  DOCUMENTS"  means  the  Bridge  Loan,   the  Intercreditor
      Agreement, the Exchange Notes Indenture, the Exchange Notes  Registration
      Rights  Agreement,  the Exchange Notes Escrow Agreement, any fee  letter,
      any security document,  any  accession letter, any hedging agreement, any
      transfer certificate, any subfacility  document  and  any  other document
      designated as such by the Bridge Loan Agent and the Company  and  "Bridge
      Loan Document" means any of them.

      "BUDGET" means with respect to each financial year commencing on or after
      1 January 2004, the latest annual budget delivered by the Company to  the
      Facility Agent pursuant to Clause 21.4 (Budgets).

      "BUSINESS  DAY"  means  a  day (other than a Saturday or Sunday) on which
      banks are open for general business  in  London,  Frankfurt  am  Main and
      Luxembourg and:

      (a)    (in  relation  to  any  date for payment or purchase of a currency
             other than Euro) the principal  financial centre of the country of
             that currency; or

      (b)    (in relation to any date for payment  or  purchase  of  Euro)  any
      TARGET Day.

      "CANADIAN  COMPETITION  LAW  LIABILITIES"  means the fines imposed on the
      Company  or  any Group Member by the Canadian  antitrust  authorities  in
      relation  to Existing  Competition  Law  Proceedings  in  Canada  in  the
      outstanding amount of Canadian Dollar 6,000,000 as of the Signing Date.

      "CARTEL DEPOSIT  ACCOUNT"  means  the  account of the Company established
      with Deutsche Bank, Augsburg Branch to fund the Additional EU Competition
      Law  Liabilities, the Canadian Competition  Law  Liabilities,  any  civil
      lawsuits  settled  in  2004 up to an amount of Euro 3,000,000, and the US
      Competition Law Liabilities,  in  each  case  including interest accruing
      thereon and currency hedging losses with respect thereto up to the amount
      of [e]125,300,000 (or its equivalent in another currency or  currencies),
      over  which  the Lenders are granted first ranking and the Bridge Lenders
      are granted second ranking security.

      "CARTEL DEPOSIT  ACCOUNT  AGREEMENT" means the agreement establishing the
      Cartel Deposit Account.

      "CASH COLLATERAL" means, in relation to any Letter of Credit or Letter of
      Credit Proportion of any Letter of Credit, a cash deposit in an interest-
      bearing account or accounts  with  the  Facility  Agent  (or  such  other
      financial institution reasonably acceptable to the Facility Agent) in the
      name  of  the Company (and identified as a Cash Collateral account), that
      cash deposit  and  account  to be secured in favour of the Security Agent
      and  the  relevant Lenders on terms  and  conditions  acceptable  to  the
      Facility Agent and the Security Agent.

      "CASH COLLATERAL  DOCUMENTS"  means  any documents, as the Facility Agent
      and the Security Agent may specify, to be entered into in relation to the
      Cash Collateral.

      "CASH EQUIVALENTS" has the meaning given  to it in Clause 22.1 (Financial
      Definitions).

      "CHANGE OF CONTROL" means if any person or  group  of  persons  acting in
      concert gains control of the Company or becomes a Holding Company  of the
      Company.

      For the purposes of this definition:

      (a)    "CONTROL" means:

                                       4

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             (i)   the  holding of more than fifty (50) per cent. of the issued
                   share capital of the Company; or

             (ii)  the  possession,   directly  or  indirectly,  of  the  power
                   (whether  by  way  of ownership,  shares,  proxy,  contract,
                   agency or otherwise)  to (A) cast, or direct the casting of,
                   more than fifty (50) per  cent.  of  the  maximum  number of
                   votes  that  might  be  cast  at  a  general  meeting of the
                   shareholders of the Company, (B) appoint or remove  all,  or
                   the  majority of, the directors or other equivalent officers
                   of the  Company,  or (C) give directions with respect to the
                   operating and financial  policies  of  the Company which the
                   directors or other equivalent officers thereof  are  obliged
                   to comply with; and

      (b)    "PERSONS  ACTING IN CONCERT" comprise persons who, pursuant to  an
             agreement or  understanding (whether formal or informal), actively
             co-operate to obtain or consolidate control of an entity.

      "CHARGED ASSETS" means  any  assets  of  any  Obligor that are secured in
      favour of the Security Agent and/or the other Finance Parties pursuant to
      the Security Documents or any of them.

      "CLOSING" means the date on which all the conditions precedent as set out
      in Part II of Schedule 2 (Conditions Precedent and Conditions Subsequent)
      are satisfied in accordance with Clause 4 (Conditions of Utilisation), or
      waived.

      "CLOSING DATE" means the date on which the Closing takes place.

      "CODE" means the U.S. Internal Revenue Code of 1986, as amended.

      "COMMITMENT"  means  a  Term Facility A Commitment,  a  Term  Facility  B
      Commitment, a Term Facility  C  Commitment or a Revolving Credit Facility
      Commitment in each case as reduced  or increased from time to time by any
      transfer or assignment pursuant to Clause 25 (Changes to the Lenders) and
      in the case of a Subfacility, as reduced  or increased pursuant to Clause
      2.2(c), and "COMMITMENTS" shall be construed accordingly.

      "COMPETITION LAW LIABILITIES" means the fines  imposed  on the Company or
      any  Group  Member  by  any  relevant  court or authority in relation  to
      Existing  Competition  Law Proceedings in  the  amounts  as  set  out  in
      Schedule  15  (Existing  Competition   Law   Proceedings  and  Anti-Trust
      Lawsuits).

      "COMPLIANCE CERTIFICATE" means a certificate substantially  in  the  form
      set out in Schedule 7 (Form of Compliance Certificate).

      "CONFIDENTIALITY   UNDERTAKING"   means   a  confidentiality  undertaking
      substantially in a recommended form of the  LMA  as set out in Schedule 9
      (LMA  Form of Confidentiality Undertaking) or in any  other  form  agreed
      between the Company and the Facility Agent.

      "CONVERT  DEPOSIT  ACCOUNT"  means the account of the Company established
      with Credit Suisse First Boston,  Frankfurt Branch to fund the repurchase
      of the Convertible Bond, over which the Lenders are granted first ranking
      and the Bridge Lenders are granted second ranking security.

                                       5

<PAGE>


      "CONVERT DEPOSIT ACCOUNT AGREEMENT"  means the agreement establishing the
      Convert Deposit Account.

      "CONVERTIBLE BOND(S)" means, collectively,  the  3.5%  convertible  bonds
      issued by the Company in 2000 and due in 2005.

      "DANGEROUS  SUBSTANCE"  means  any  radioactive  emissions, noise and any
      natural  or  artificial  substance  (in  whatever form)  the  generation,
      transportation, storage, treatment, use or  disposal  of  which  (whether
      alone or in combination with any other substance) gives rise to a risk of
      causing  harm  to  man  or  any  other  living  organism  or damaging the
      Environment  or public health or welfare, including (without  limitation)
      any controlled,  special,  hazardous,  toxic,  radioactive  or  dangerous
      waste.

      "DEBT  ISSUE" means any issue after the date of this Agreement of  public
      or privately placed debt securities of any Group Member.

      "DEFAULT"  means  an  Event  of  Default  or  any  event  or circumstance
      specified in Clause 24 (Events of Default) which would (with  the  expiry
      of  a grace period, the giving of notice, the making of any determination
      under  the  Finance Documents or any combination of any of the foregoing)
      be an Event of Default.

      "DEFAULT MARGIN"  means  the aggregate of the applicable Margin plus 1.25
      per cent. per annum.

      "DORMANT COMPANY" means each  Group  Member  (i)  which  has been dormant
      since its incorporation or since the end of its previous financial  year;
      and (ii) the value of whose total gross assets  is  less  than [e]100,000
      (or its equivalent in another currency or currencies).

      "EMPLOYEE PLAN" means an "EMPLOYEE BENEFIT PLAN" as defined in section  3
      (3)  of  ERISA, other than a Multiemployer Plan, which is maintained for,
      or under which  contributions  are  made  on behalf of, employees of a US
      Group Member or any ERISA Affiliate.

      "ENVIRONMENT"  means  all,  or  any  of,  the following  media:  the  air
      (including,  without limitation, the air within  buildings  and  the  air
      within other natural or man-made structures above or below ground), water
      (including, without  limitation,  ground  and  surface  water)  and  land
      (including, without limitation, surface and sub-surface soil).

      "ENVIRONMENTAL CLAIM" means any claim by any person:

      (a)    in  respect  of any loss or liability suffered or incurred by that
             person as a result  of  or  in  connection  with  any violation of
             Environmental Law; or

      (b)    that  arises  as  a  result of or in connection with Environmental
             Contamination and that  could  give  rise to any remedy or penalty
             (whether interim or final) that may be  enforced  or  assessed  by
             private   or  public  legal  action  or  administrative  order  or
             proceedings.

                                       6

<PAGE>


      "ENVIRONMENTAL CONTAMINATION"  means  each  of  the  following  and their
       consequences:

      (a)    any  release,  discharge,  emission,  leakage  or  spillage of any
             Dangerous Substance at or from any site owned, leased, occupied or
             used by any Group Member into any part of the Environment; or

      (b)    any accident, fire, explosion or sudden event at any  site  owned,
             leased, occupied or used by any Group Member which is directly  or
             indirectly  caused  by or attributable to any Dangerous Substance;
             or

      (c)    any other pollution of the Environment.

      "ENVIRONMENTAL LAW" means all laws (including, without limitation, common
      law), regulations, directives,  codes  of  practice,  circulars, guidance
      notices  and  the like having legal effect concerning the  protection  of
      human health, the  Environment,  the  conditions of the work place or the
      generation, transportation, storage, treatment  or  disposal of Dangerous
      Substances.

      "ENVIRONMENTAL LICENCE" means any permit, licence, authorisation, consent
      or other approval required by any Environmental Law.

      "EQUITY ISSUE" means any issue of shares by any Group Member or any issue
      or  grant  of rights to subscribe for shares in any Group  Member,  other
      than any issue  of shares or rights to subscribe for shares under a stock
      option or similar  program of the Company, whereby such issue or granting
      of rights is funded through cash payments provided by any third party not
      being a Group Member

      "ERISA" means the US  Employee  Retirement Income Security Act of 1974 or
      any successor legislation to that Act and the regulations promulgated and
      rulings issued under that Act or any such successor legislation.

      "ERISA AFFILIATE" means any person that for purposes of Title I and Title
      IV of ERISA and section 412 of the  Code  is  a  member  of  a  US  Group
      Member's  controlled  group,  or  under  common  control  with a US Group
      Member, within the meaning of section 414(b) or (c) of the Code.

      "ERISA EVENT" means:

      (a)    any  reportable event, as defined in section 4043 of  ERISA,  with
             respect  to  an  Employee  Plan,  as  to  which  PBGC  has  not by
             regulation waived the requirement of section 403(a) of ERISA  that
             it  be notified within thirty days of the occurrence of such event
             (provided  that  a failure to meet the minimum funding standard of
             section 412 of the  Code  or  section  302  of  ERISA  shall  be a
             reportable event for the purposes of this paragraph (a) regardless
             of  the  issuance of any waivers in accordance with section 412(d)
             of the Code)  or  the  requirements  of  subsection (1) of section
             403(b)  of  ERISA  (taking  into account subsection  (2)  of  such
             section)  are  met with respect  to  a  contributing  sponsor,  as
             defined in section  4001(a)(13)  of ERISA, of an Employee Plan and
             an event described in paragraph (9),  (10),  (11)  (12  or (13) of
             section  4043(c)  of  ERISA  is reasonably expected to occur  with
             respect to such Employee Plan within the following 30 days;

                                       7

<PAGE>



      (b)    the filing under section 4041(c) of ERISA of a notice of intent to
             terminate any Employee Plan or  the  termination  of  any Employee
             Plan under section 4041(c) of ERISA;

      (c)    the institution of proceedings under section 4042 of ERISA  by the
             PBGC  for  the termination of, or the appointment of a trustee  to
             administer, any Employee Plan;

      (d)    the failure  to  make a required contribution to any Employee Plan
             that would result  in  the  imposition  of  an  Encumbrance  under
             section 412 of the Code or section 302 of ERISA; and

      (e)    an  engagement  in  a non-exempt prohibited transaction within the
             meaning of section 4795  of the Code or section 406 of ERISA which
             upon the occurrence of any  of  the events described in paragraphs
             (a) to (c) (inclusive) above could  reasonably be expected to have
             a Material Adverse Effect.

      "EU COMPETITION LAW LIABILITIES" means the Original  EU  Competition  Law
      Liabilities and the Additional EU Competition Law Liabilities.

      "EU  COMPETITION  LAW  PROCEEDINGS"  means  the  Existing Competition Law
      Proceedings  initiated  by the competition directorate  of  the  European
      Commission.

      "EURIBOR" means, in relation to any Loans in Euros:

      (a)    the applicable Screen Rate; or

      (b)    (if no Screen Rate  is  available for the period of that Loan) the
             arithmetic mean of the rates  (rounded  upwards  to  four  decimal
             places) as supplied to the Facility Agent at its request quoted by
             the  Reference  Banks  to  Prime  Banks  in the European interbank
             market,

      as  of  the  Specified  Time  on the Quotation Day for  the  offering  of
      deposits in Euros for a period  comparable  to the Interest Period of the
      relevant Loan.

      "EURO AMOUNT" means, in relation to a Revolving Credit Facility Loan, the
      amount  specified in the Utilisation Request for  that  Revolving  Credit
      Facility  Loan  (or, if the amount requested is not denominated in Euros,
      that amount converted  into  Euros  at  the Facility Agent's Spot Rate of
      Exchange on the date which is in relation  to  a  Utilisation  three  (3)
      Business  Days  before the Utilisation Date or, if later, on the date the
      Facility Agent receives  the Utilisation Request, adjusted to reflect any
      repayment, prepayment, consolidation  or  division  or  reduction  of the
      Revolving Credit Facility Loan).

      "EVENT  OF DEFAULT" means any event or circumstance specified as such  in
      Clause 24 (Events of Default).

      "EXCESS CASH  FLOW" has the meaning given to it in Clause 22.1 (Financial
      Definitions).

      "EXCHANGE NOTES"  means  the  high  yield  exchange notes issued or to be
      issued  by  the  Issuer in exchange for Bridge  Loans,  escrowed  on  the
      Closing Date, and  issued in accordance with the terms of the Bridge Loan
      and the related Bridge  Loan  Documents;  provided  that  such high yield
      exchange notes are subject to the terms of, and issued in accordance with
      the provisions set forth in the Intercreditor Agreement.

                                       8

<PAGE>


      "EXCHANGE  NOTES  ESCROW  AGENT"  means the entity named as escrow  agent
      under the Exchange Notes Escrow Agreement.

      "EXCHANGE NOTES ESCROW AGREEMENT" means  the escrow agreement to be dated
      the Closing Date, relating to the escrow of  the  Exchange  Notes  on the
      Closing  Date, among the Company, the Issuer, the Bridge Loan Agent,  the
      Exchange Notes Trustee and the Exchange Notes Escrow Agent.

      "EXCHANGE  NOTES  INDENTURE"  means  the indenture governing the Exchange
      Notes, to be dated the Closing Date, among the Issuer, the Exchange Notes
      Trustee and the Subordinated Guarantors.

      "EXCHANGE NOTES INVESTORS" means the noteholders  of  the  Exchange Notes
      from time to time.

      "EXCHANGE  NOTES  REGISTRATION  RIGHTS  AGREEMENT" means the registration
      rights  agreement,  to  be  dated  the  Closing  Date,  relating  to  the
      registration of the Exchange Notes with the  US  Securities  and Exchange
      Commission.

      "EXCHANGE  NOTES  SECURITY  AGENT" means the entity or entities named  as
      security agent for the Exchange Notes Investors under the Exchange Notes.

      "EXCHANGE NOTES TRUSTEE" means  The  Bank  of New York as the trustee for
      the Exchange Notes Investors under the Exchange Notes.

      "EXISTING COMPETITION LAW PROCEEDINGS" means  the competition law related
      litigation,  civil lawsuits and/or other proceedings  of  or  before  any
      court  or agency  set  out  in  Schedule  15  (Existing  Competition  Law
      Proceedings and Anti-Trust Lawsuits).

      "EXISTING  INDEBTEDNESS"  means  the  Financial Indebtedness of the Group
      outstanding  on the Signing Date as set  out  in  Schedule  17  (Existing
      Indebtedness).

      "EXPIRY DATE"  means,  in  relation  to any Letter of Credit, the date on
      which the maximum aggregate liability under it is to be reduced to zero.

      "FACILITIES" means Term Facility A, Term  Facility B, Term Facility C and
      the  Revolving  Credit  Facility  and  "FACILITY"   shall   be  construed
      accordingly.

      "FACILITY AGENT'S SPOT RATE OF EXCHANGE" means the Facility Agent's  spot
      rate of exchange for the purchase of the relevant currency with Euros  in
      the London foreign exchange markets at or about 11:00 a.m. London time on
      a particular day.

      "FACILITY  OFFICE"  means the office or offices notified by a Lender or a
      Issuing Bank to the Facility  Agent  in  writing on or before the date it
      becomes a Lender or a Issuing Bank (or, following  that date, by not less
      than  five (5) Business Days' written notice) as the  office  or  offices
      through which it will perform its obligations under this Agreement.

      "FEE LETTERS"  means  any  letter  or  letters  dated on the Signing Date
      between  the  Mandated Lead Arrangers and the Company  (or  the  Facility
      Agent or the Security  Agent  or  a Issuing Bank and the Company) setting
      out any of the fees referred to in Clause 13 (Fees).

      "FINANCE DOCUMENTS" means this Agreement,  the  Intercreditor  Agreement,
      any  Fee  Letter,  any  Security  Document,  the  Convert Deposit Account
      Agreement,  the Cartel Deposit Account Agreement, any  Accession  Letter,
      any  Hedging Agreement,  any  Transfer

                                       9

<PAGE>

      Certificate, the US Term Loan Agreement, any Subfacility Document and any
      other  document  designated as such by the Facility Agent and the Company
      and "FINANCE DOCUMENT" means any of them.

      "FINANCE PARTIES" means the Documentation  Agent, the Facility Agent, the
      Security  Agent,  the  Mandated  Lead  Arrangers,   an  Issuing  Bank,  a
      Subfacility  Bank,  the  Senior  Lenders, the Administrative  Agent,  and
      "FINANCE PARTY" means any of them.

      "FINANCIAL INDEBTEDNESS" means any indebtedness for or in respect of:

      (a)    moneys borrowed and debt balances at banks;

      (b)    any  amount  raised  by acceptance  under  any  acceptance  credit
             facility;

      (c)    any amount raised pursuant  to  any  note purchase facility or the
             issue  of  bonds, notes, debentures, loan  stock  or  any  similar
             instrument;

      (d)    the amount of  any  liability  in  respect  of  any  lease or hire
             purchase  contract  which  would, in accordance with the  Relevant
             GAAP or IFRS, be treated as a finance or capital lease;

      (e)    receivables sold or discounted  (other than any receivables to the
             extent they are sold on a non-recourse basis);

      (f)    any  amount  raised  under any other  transaction  (including  any
             forward sale or purchase  agreement)  having the commercial effect
             of a borrowing;

      (g)    any  derivative  transaction  entered  into   in  connection  with
             protection  against or benefit from fluctuation  in  any  rate  or
             price  (and,  when   calculating   the  value  of  any  derivative
             transaction, only the marked to market  value  shall be taken into
             account);

      (h)    any  counter-indemnity  obligation  in  respect  of  a  guarantee,
             indemnity,  bond, standby or documentary letter of credit  or  any
             other instrument issued by a bank or financial institution;

      (i)    any amount raised by the issue of redeemable shares;

      (j)    any amount of  any liability under an advance or deferred purchase
             agreement if one of the primary reasons behind the entry into such
             agreement is to raise finance;

      (k)    (without double  counting)  the amount of any liability in respect
             of any guarantee or indemnity  for any of the items referred to in
             paragraphs (a) to (j) above, however,  for  the avoidance of doubt
             not including any deferred payment arrangement of 180 days or less
             with trade creditors as customary in the industry; and

      (l)    (without  double  counting) the amount of any liability  of  third
             parties in respect  of  any of the items referred to in paragraphs
             (a) to (j) above, secured over assets of any Group Member.

      "FINANCIAL QUARTER" means each of those periods of approximately thirteen
      weeks ending on any Quarter Date in each financial year.

                                       10

<PAGE>


      "FRONTING  FEE" means the fronting  fee  determined  in  accordance  with
      Clause 13.6  (Fronting  Fee) and to be paid to a relevant Issuing Bank in
      accordance with Clause 5.9 (Letter of Credit Fronting Fee).

      "FUNDING LOANS" means one  or  more  loans from the Issuer (as lender) to
      the Company (as borrower), in an amount  equal to the principal amount of
      the  High Yield Notes which is made subject  to  the  terms  of,  and  in
      accordance with, the Intercreditor Agreement.

      "GOVERNMENT  AGENCY"  means  (a) a government or government department or
      other body, (b) a governmental,  semi-governmental or judicial person, or
      (c)  a  person  (whether autonomous or  not)  who  is  charged  with  the
      administration of law under statute or the rules of any stock exchange.

      "GROUP" means the  Company  and  its  Subsidiaries  from time to time and
      "GROUP MEMBER" shall be construed accordingly.

      "GROUP STRUCTURE CHART" means a group structure chart  of  the  Group, in
      agreed  form, delivered by the Company to the Facility Agent pursuant  to
      Clause 4 (Conditions of Utilisation).

      "GUARANTOR"  means  an  Original  Guarantor  or  an Additional Guarantor,
      unless it has ceased to be a Guarantor in accordance with this Agreement.

      "GUARANTOR ACCESSION LETTER" means a document substantially  in  the form
      set out in Part II of Schedule 6 (Form of Accession Letter).

      "HEDGE  COUNTERPARTY" means any financial institution that is a party  to
      an outstanding  Hedging Agreement with any Group Member from time to time
      and entitled to the  same  security  rights  as the Finance Parties under
      this  Agreement  after  accession to the Security  Trust  Agreement  upon
      notification to the Security  Agent  by the Company pursuant to the terms
      of the Security Trust Agreement. Such  Hedge  Counterparty  will  benefit
      from   the   Transaction   Security   up   to  its  Hedge  Counterparty's
      Participation Amount as notified by the Company.  The Security Agent will
      keep  updated  lists of the Hedging Counterparties and  their  respective
      Hedge Counterparty's  Participation  Amounts  by  means  of  the  List of
      Secured Parties.

      "HEDGE   COUNTERPARTIES  MAXIMUM  SECURED  AMOUNT"  means  an  amount  of
      [e]65,000,000  at maximum  which will be applied from the proceeds of the
      enforcement of the Transaction Security pursuant to the provisions of the
      Security  Trust  Agreement in order to discharge  the claims of any Hedge
      Counterparty  in  accordance  with the  respective  Hedge  Counterparty's
      Participation Amount as notified by the Company.

      "HEDGE COUNTERPARTY'S PARTICIPATION AMOUNT"  has  the meaning ascribed to
      such term in the Security Trust Agreement.

      "HEDGING AGREEMENTS" means each of the agreements entered  into  or to be
      entered  into between certain Group Members and hedge counterparties  for
      the purpose  of  hedging  interest rate liabilities and currency risks in
      accordance with Clause 23.28 (Hedging).

      "HIGH YIELD INDENTURE" means  the  indenture  under  which the High Yield
      Notes are issued.

      "HIGH YIELD INVESTORS" means the High Yield Trustee and  the  noteholders
      of the High Yield Notes from time to time.

                                       11

<PAGE>


      "HIGH  YIELD  NOTES"  means  the  8  1/2  %  Senior  Notes due 2012 in an
      aggregate  principal amount of  [e]270,000,000  issued or to be issued by
      the Issuer;  provided that such high yield notes are issued in accordance
      with the Intercreditor Agreement.

      "HIGH YIELD TRUSTEE" means The Bank of New York as the trustee  under the
      High Yield Indenture.

      "HITCO  OPTIONS"  means  the  option  exercisable  under  a  shareholders
      agreement  between  Hitco  Carbon  Composites,  Inc  and  Paul W. Pendorf
      described in more detail in the annual report of the Company on Form 20-F
      filed  with  the  Securities  and  Exchange  Commission  on 1 July  2002,
      provided  that,  for  the avoidance of doubt, all such options  exist  in
      respect to shares in Hitco  Carbon  Composites, Inc only and there are no
      options in relation to the shares of SGL Carbon LLC.

      "HOLDING COMPANY" means, in relation  to  a  company  or corporation, any
      other company or corporation in respect of which it is a Subsidiary.

      "IFRS" means international financial reporting standards  as  promulgated
      by the International Accounting Standards Board and consistently applied.

      "INITIAL MARGIN" means 2.75 per cent. per annum.

      "INSURANCE  PROCEEDS"  means  the  total proceeds of any insurance  claim
      intended  to  compensate  for damage to  any  asset  or  interruption  of
      business received by any Group Member, after deducting:

      (a)    any reasonable out-of-pocket expenses incurred by any Group Member
             in relation to such a claim;

      (b)    proceeds relating to  third party claims which are applied towards
             meeting such claims; and

      (c)    Taxes paid (or reasonably  estimated  to  be payable) by any Group
             Member in respect of such claims.

      "INTELLECTUAL PROPERTY" means any and all rights and  interests  existing
      now  or  in  the  future  in  any  part  of  the  world in or relating to
      registered and unregistered trade marks and service  marks, domain names,
      patents, registered designs, utility models, trade names, business names,
      titles,   registered   or   unregistered  copyrights  in  published   and
      unpublished  works,  unregistered   designs,   inventions  registered  or
      unregistered, data base rights, know-how, any other intellectual property
      rights  and any applications for any of the foregoing  and  any  goodwill
      therein.

      "INTELLECTUAL  PROPERTY  RIGHTS" means any Intellectual Property owned by
      any Group Member.

      "INTERCREDITOR   AGREEMENT"    means    the    intercreditor   agreement,
      substantially in the form set out in Schedule 18  (Form  of Intercreditor
      Agreement)  between,  inter  alia,  the Security Agent, the Company,  the
      Obligors, the Issuer, the Hedge Counterparties, the Secured Creditors and
      (upon accession) the High Yield Trustee  and  The  Bank  of  New  York as
      trustee  for  the  holders  of the Convertible Bonds, setting out certain
      subordination, delayed maturity  and blockage provisions in favour of the
      Lenders.

                                       12

<PAGE>



      "INTEREST PERIOD" means, in relation to a Loan, each period determined in
      accordance  with  Clause 11 (Interest  Periods  and  the  Term)  and,  in
      relation to an Unpaid  Sum,  each  period  determined  in accordance with
      Clause 10.7 (Default Interest and Penalty).

      "INTRA-GROUP LOAN" means any loan between Group Members  other  than  the
      Funding Loan.

      "INTRA-GROUP  LOAN  DOCUMENT"  means  any  document,  in the agreed form,
      setting  out  the  terms  on  which  an  Intra-Group Loan is to  be  made
      available in accordance with the terms of this Agreement.

      "ISSUER" means (i) SGL Carbon Luxembourg S.A.,  a  wholly-owned,  special
      purpose  direct  subsidiary  of  the  Company incorporated in Luxembourg,
      formed to issue the High Yield Notes; or  (ii)  any  other  issuer of the
      High Yield Notes.

      "ISSUING  BANKS"  means  each of the creditors having issued a Letter  of
      Credit from time to time in  their  capacity  as Lender pursuant to their
      respective Term Facility B Commitment at the time  when  such  Letter  of
      Credit was issued and, until the release of the Original Letter of Credit
      in  accordance with Clause 5.8 (Cancellation and replacement of Letter of
      Credit), the Original Issuing Banks.

      "JOINT  VENTURE"  means  any  joint  venture  entity,  whether a company,
      unincorporated   firm,   undertaking,   association,  joint  venture   or
      partnership or any other entity.

      "LENDERS" means:

     (a)  any Original Lender; and

     (b)  any  bank  or  financial  institution  which  has  become a Party  in
          accordance  with Clause 25 (Changes to the Lenders),

      which in each case has not ceased to be a Party  in  accordance  with the
      terms of this Agreement and shall include any Lender in its capacity as a
      Subfacility Bank.

      "LETTER  OF  CREDIT"  means  each  letter of credit issued by the Issuing
      Banks substantially in the form set out in Schedule 14 (Form of Letter of
      Credit)  or  in  such  other  form requested  by  the  Company  which  is
      acceptable to the Facility Agent  and  the  Term  Facility B Lenders and,
      until  its  release  in  accordance  with  Clause  5.8 (Cancellation  and
      replacement of Letter of Credit), the Original Letter of Credit.

      "LETTER OF CREDIT AMOUNT" means:

      (a)    each  sum  paid,  or due and payable, by an Issuing  Bank  to  the
             beneficiary of a Letter  of  Credit  pursuant  to the terms of the
             respective Letter of Credit; and

      (b)    all liabilities, costs (including, without limitation,  any  costs
             incurred  in  funding  any  amount which falls due from an Issuing
             Bank  under the Letter of Credit),  claims,  losses  and  expenses
             which that  Issuing Bank incurs or sustains under or in connection
             with the respective Letter of Credit,

      in each case which has  not  been  reimbursed pursuant to Clause 8.2 (The
      Company's Indemnity to Issuing Banks).

                                       13

<PAGE>


      "LETTER OF CREDIT COMMISSION RATE" means,  save  as otherwise provided in
      this  Agreement, the rate referred to in Clause 13.4  (Letter  of  Credit
      Commission).

      "LETTER  OF  CREDIT  PROPORTION"  means,  in  relation to an Issuing Bank
      and/or a Term Facility B Lender in respect of any  Letter  of  Credit and
      save  as  otherwise provided in this Agreement, the proportion (expressed
      as a percentage) borne by that Issuing Bank's or Term Facility B Lender's
      Available Commitment  in  respect  of  Term  Facility  B to the Available
      Facility immediately prior to the issue of such Letter of Credit.

      "LIBOR" means, in relation to any Loan not in Euros:

      (a)    the applicable Screen Rate; or

      (b)    (if no Screen Rate is available for the currency or period of that
             Loan)  the arithmetic mean of the rates (rounded upwards  to  four
             decimal  places)  as supplied to the Facility Agent at its request
             quoted  by the Reference  Banks  to  Prime  Banks  in  the  London
             interbank market,

      as of the Specified  Time  on  the  Quotation  Day  for  the  offering of
      deposits in the currency of that Loan and for a period comparable  to the
      Interest Period for that Loan.

      "LMA" means the Loan Market Association.

      "LOAN" means the Term Facility A Loan, the Term Facility B Loan, the Term
      Facility C Loan or a Revolving Credit Facility Loan and "LOANS" shall  be
      construed accordingly.

      "MAJORITY LENDERS" means:

      (a)   if  there  are no Loans or Letters of Credit then  outstanding,  a
            Lender or Lenders whose Commitments  aggregate more than 66 2/3 per
            cent. of the Total  Commitments (or, if the Total  Commitments have
            been reduced to zero,  aggregated more than 66 2/3 per cent. of the
            Total Commitments immediately prior to the reduction); or

      (b)   at any other time,  a  Lender or Lenders  whose  participations  in
            the  Outstandings  aggregate  more than 66 2/3 per cent. of all the
            Outstandings.

      "MANAGEMENT AND EMPLOYEE BENEFIT PLANS" means  (i) the stock option plan,
      the  matching shares plan, the share bonus plan and  the  employee  share
      ownership  plan,  each relating to shares in the Company and each adopted
      in the ordinary shareholders' meeting of the Company on 27 April 2000 and
      (ii) the stock option plan relating to shares in Hitco Carbon Composites,
      Inc. adopted in January  2002,  each  as  described in more detail in the
      annual report on Form 20-F filed by the Company  with  the  US Securities
      and Exchange Commission on 1 July 2002.

      "MANDATORY  CASH COLLATERAL" means Cash Collateral that the Company  must
      provide in relation to interest accruing on the Letters of Credit.

      "MANDATORY COST"  means  the  percentage rate per annum calculated by the
      Facility Agent in accordance with Schedule 4 (Mandatory Cost Formula).

      "MARGIN" means the percentage rate  per  annum  determined  in accordance
      with  Clause  10.2  (Margin Ratchets) to Clause 10.4 (Margin in  Default)
      (inclusive).

                                       14

<PAGE>


      "MATERIAL ADVERSE CHANGE"  means  any  circumstance  that has or could be
      expected to have a Material Adverse Effect.

      "MATERIAL ADVERSE EFFECT" means a material adverse effect on:

      (a)    the  business,   operations,   assets,   condition  (financial  or
             otherwise) or prospects of the Group taken as whole;

      (b)    the  ability  of any  Obligor  to  perform  and  comply  with  its
             obligations under any Finance Document;

      (c)    the validity,  legality or  enforceability of any Finance Document
             or any rights or remedies  of any Finance  Party under any Finance
             Document; or

      (d)    the validity,  legality or  enforceability of any Security created
             pursuant to the  Security  Documents or on the priority or ranking
             of any such Security.

      "MATERIAL SUBSIDIARY" means:

      (a)    any company listed in Schedule 13 (Current Material Subsidiaries);
             and

      (b)    any  Group Member having more than five (5) per cent. of EBITDA or
             turnover  of  the Group by reference to the most recent respective
             annual audited financial statements.

      For this purpose:

      (a)    the (i) turnover  or (ii) EBITDA of a Subsidiary of the Group will
             be determined from  its financial statements upon which the latest
             audited financial statements of the Group have been based;

      (b)    if a company becomes  a  Group  Member after the Closing Date, the
             (i) turnover or (ii) EBITDA of that  company will be determined as
             set out in its latest audited financial  statements as at the date
             it becomes a Group Member and based on the most recently available
             financial information of the Group, adjusted  to  give  pro  forma
             effect to the acquisition of such company;

      (c)    in relation to a Group Member which has acquired or disposed of  a
             company  or business the (i) turnover or (ii) EBITDA of that Group
             Member will  be  determined  from  its  latest  audited  financial
             statements adjusted to reflect such acquisition or disposals; and

      (d)    if a Material Subsidiary disposes of all or substantially  all  of
             its assets to another Subsidiary of the Group, it will immediately
             cease  to be a Material Subsidiary and the other Subsidiary (if it
             is not already) will immediately become a Material Subsidiary. The
             subsequent financial statements of such Subsidiaries and the Group
             will  be   used   for  determining  the  status  of  the  relevant
             Subsidiaries as Material Subsidiaries.

      If there is a dispute as to  whether  or  not  a  company  is  a Material
      Subsidiary, a certificate of the Company's appointed auditors will be, in
      the absence of manifest error, conclusive.

      "MONTH" means a period starting on one day in a calendar month and ending
      on  the numerically corresponding day in the next calendar month,  except
      that:

                                       15

<PAGE>


      (a)    (subject to paragraph (c) below) if the numerically  corresponding
             day is not a  Business  Day,  that  period  shall  end on the next
             Business Day in that calendar month in which that period is to end
             if there is one, or if there is not, on the immediately  preceding
             Business Day;

      (b)    if there is no numerically corresponding day in the calendar month
             in which that period is to end,  that period shall end on the last
             Business Day in that calendar month; and

      (c)    for the purpose of determining the last day of an Interest Period,
             if an  Interest  Period  begins  on  the  last  Business  Day of a
             calendar  month,  that  Interest  Period  shall  end on  the  last
             Business Day in the calendar  month in which that Interest  Period
             is to end.

      The above rules  (a)  to  (c)  will  only  apply to the last Month of any
      period.

      "MULTIEMPLOYER PLAN" means a "MULTIEMPLOYER  PLAN"  as defined in section
      4001(a)(3) of ERISA, maintained or contributed to for  employees  of a US
      Group Member or any ERISA Affiliate.

      "NET PROCEEDS" means, in relation to:

      (a)    any disposal of an asset by a Group Member, the total proceeds  of
             such disposal received by such Group Member, after deducting:

             (i)   any  out-of-pocket  costs and expenses incurred by any Group
                   Member in respect of such disposal;

             (ii)  the unpaid balance on  the  date  of  such  disposal  of any
                   Permitted Indebtedness which must be repaid by the seller on
                   such  disposal  (together with any premium, interest or fees
                   required to be paid in connection therewith);

             (iii) Taxes paid (or reasonably  estimated  to  be payable) by any
                   Group Member in connection with such disposal; and

             (iv)  in the case of a disposal effected by a Group  Member  other
                   than  a  Borrower,  such  provision as is reasonable for all
                   costs  and  Taxes  incurred  by   the   Group   and   fairly
                   attributable to upstreaming the cash proceeds or making  any
                   distribution in connection with such proceeds to enable them
                   to  reach  a Borrower by such means as results in the lowest
                   possible liability in respect of such costs and Taxes; and

      (b)    any Debt Issue and/or  any  Equity  Issue  by  a Group Member, the
             total proceeds of such issue received by such Group  Member, after
             deducting:

             (i)   any out-of-pocket costs and expenses incurred by  any  Group
                   Member in respect of such issue; and

             (ii)  Taxes  paid  (or  reasonably estimated to be payable) by any
                   Group Member in connection with such issue.

      "OBLIGORS" means each Borrower and  each Guarantor and "OBLIGOR" shall be
      construed accordingly.

                                       16

<PAGE>


      "ORIGINAL EU COMPETITION LAW LIABILITIES"  means the fines imposed on the
      Company  or  any  Group  Member  by the competition  directorate  of  the
      European Commission in the amounts  of  [e]80,200,000  and  [e]27,750,000
      in relation  to the EU Competition Law Proceedings, listed on Schedule 15
      (Existing Competition Law Proceedings and Anti-Trust Lawsuits), No. 1 and
      2.

      "ORIGINAL FACILITIES AGREEMENT" means  the [e]495,000,000 term facilities
      and revolving credit agreement dated 20 December 2002, as amended.

      "ORIGINAL FINANCING DOCUMENTS" has the meaning  ascribed  to  "Facilities
      Agreement" in the Original Facilities Agreement.

      "ORIGINAL  ISSUING  BANKS"  means Deutsche Bank Luxembourg S.A., Dresdner
      Bank    AG    in    Munchen,    Bayerische    Landesbank,     Commerzbank
      Aktiengesellschaft,  Augsburg  Branch,  WestLB  AG,  DZ  Bank AG Deutsche
      Zentral-  Genossenschaftsbank,  Bayerische  Hypo-  und  Vereinsbank   AG,
      Augsburg Branch having issued the Original Letter of Credit.

      "ORIGINAL LETTER OF CREDIT" means the letter of credit of up to an amount
      of [e]80,200,000, plus  interest  accruing  thereon at 6.04 per cent. per
      annum since 24 October 2001, issued by the Original Issuing Banks.

      "ORIGINAL OBLIGOR" means an Original Borrower or an Original Guarantor.

      "ORIGINAL  TERM FACILITY C" means the [e]20,000,000  term  facility  made
      available to the Company under the Original Facilities Agreement.

      "OUTSTANDINGS" means, at any  time,  the  aggregate of the amounts of the
      outstanding Loans and the maximum actual and  contingent  liabilities  of
      the  Issuing  Banks,  as  the  case may be, in respect of the outstanding
      Letter of Credit.

      "PARTICIPATING MEMBER STATE" means  any  member  state  of  the  European
      Communities that adopts or has adopted the Euro as its lawful currency in
      accordance  with  legislation  of the European Union relating to European
      Monetary Union.

      "PARTY" means a party to this Agreement  and  includes  its successors in
      title, permitted assigns and permitted transferees.

      "PBGC" means the US Pension Benefit Guaranty Corporation,  or  any entity
      succeeding to all or any of its functions under ERISA.

      "PERFECTION  REQUIREMENTS"  means  the execution of any Security Document
      and the making of appropriate registrations,  transfers  of possession or
      endorsements  of  the Security Documents as specifically contemplated  by
      any legal opinion to be delivered in accordance with Clause 4 (Conditions
      of Utilisation).

      "PERMITTED ACQUISITIONS" means Acquisitions:

      (a)    made in the ordinary course of business; and/or

      (b)    where the  consideration  for such  Acquisitions  in the aggregate
             does  not  exceed  [e]10,000,000  (or its  equivalent  in  another
             currency or currencies)  per annum,  provided that such limitation
             shall  not  apply as long as (i) the  Leverage  Ratio  (as  tested
             quarterly  against the  Company's  latest  consolidated  financial
             statements  on a four  quarter  rolling  basis)  will be less than
             3.0:1; (ii) on a pro forma basis for such

                                       17

<PAGE>


             Acquisition  the  Leverage  Ratio is at least  0.25 lower than the
             applicable  ratio set out opposite  the  relevant  Quarter Date in
             Clause 22.4 (Leverage Ratio),  and (iii) the Available  Commitment
             under   the   Revolving   Credit   Facility   is  not  less   than
             [e]10,000,000; and/or

      (c)    where the  consideration  for such  Acquisitions in aggregate does
             not exceed 25 per cent.  of the Net  Proceeds of any Equity  Issue
             (other than the Rights Issue) realised after the Signing Date,

      PROVIDED THAT where any assets  are  so  acquired  by  the relevant Group
      Member  such  assets  are not subject to any material liabilities  or  to
      Security other than Permitted Security.

      "PERMITTED DISPOSAL" means:

      (a)    disposals of inventory  made  on  customary  terms in the ordinary
             course of trading of the disposing entity;

      (b)    disposals  of  assets in exchange for other assets  comparable  or
             superior as to type, value and quality;

      (c)    disposals between  any  Group Members, PROVIDED THAT if the assets
             disposed of are pledged or  assigned  in  favour  of  the Security
             Agent they remain subject to the same or equivalent security after
             the disposal and FURTHER PROVIDED THAT this paragraph (c) will not
             permit disposal by an Obligor or its Subsidiary to a Group  Member
             which is not an Obligor or its Subsidiary;

      (d)    disposals  on  arm's  length  terms  of any surplus or obsolete or
             worn-out  assets  which in the reasonable  opinion  of  the  Group
             Member making the disposal  are  not  required  for  the efficient
             operation of the business of the Group as a whole or by  any Group
             Member;

      (e)    disposals   of  Cash  Equivalents,  other  than  Cash  Equivalents
             deposited in  the  Convert  Deposit  Account or the Cartel Deposit
             Account, on arm's length terms for Cash  or  in  exchange for Cash
             Equivalents;

      (f)    disposals  of  cash,  other  than  cash  deposited in the  Convert
             Deposit Account or the Cartel Deposit Account, where such disposal
             is not otherwise prohibited by the Finance Documents;

      (g)    disposals constituted by the creation of any Permitted Security;

      (h)    a sale or securitisation of receivables on  a  non-recourse  basis
             only  to the extent that it is entered into with the prior written
             consent   of   the  Majority  Lenders,  such  consent  not  to  be
             unreasonably withheld;

      (i)    [intentionally left blank];

      (j)    any disposal of  land  and/or  buildings  of  SGL  CARBON AG, Werk
             Ringsdorff,  Werksteil Nord in Bonn, relating to the  real  estate
             registered with  Amtsgericht  Bonn, Grundbuchamt Lannesdorf, Blatt
             01105,  Flur  2,  Flurstucke 972,  968,  967, laufende Nummer 3, 4
             und 5, Amtsgericht Bonn, Grundbuchamt Muffendorf, Blatt 0488, Flur
             3, Flurstuck 1218,  laufende  Nummer  1, and  Blatt  0575, Flur 3,
             Flurstucke 418/69,   1127,  1217, 1276, 1279, laufende  Nummer  2,
             8, 9, 10, 12.

                                       18

<PAGE>


      (k)    disposals  of  Cash  or  Cash  Equivalents  in the Convert Deposit
             Account to purchase Convertible Bonds in the  Tender  Offer  or in
             the  open  market (at a price no higher than par) after completion
             of the Tender  Offer, and to redeem or repay the Convertible Bonds
             at maturity;

      (l)    disposals of Cash  or  Cash  Equivalents  in  the  Cartel  Deposit
             Account  to  satisfy the Additional EU Competition Law Liabilities
             and the US Competition Law Liabilities; or

      (m)    disposals where  the  higher  of the market value or consideration
             receivable (when aggregated with the higher of the market value or
             consideration receivable for any  other  sale,  lease, transfer or
             other disposal, other than any permitted under paragraphs  (a)  to
             (l) above) does  not  exceed  [e]25,000,000  (or its equivalent in
             another currency or currencies) in any financial year.

      "PERMITTED GUARANTEES AND CONTINGENT LIABILITIES" means:

      (a)    any guarantees and indemnities required by the Finance Documents;

      (b)    any guarantees and indemnities given by any Group  Member  in  the
             ordinary  course  of  and  on  terms  customary in its business in
             respect of obligations not constituting Financial Indebtedness;

      (c)    any guarantees constituting Permitted Indebtedness;

      (d)    any  guarantees  issued  by  any  Group  Member   in   respect  of
             liabilities of an Obligor, or a Subsidiary of an Obligor which are
             secured by any Security specified in Schedule 11 (Form of Security
             Trust Agreement);

      (e)    any  guarantee  or  indemnity  given  by any Group Member for  the
             benefit of the US Lenders, provided that  the  same  guarantee  or
             indemnity,   ranking   equally,  has  been  or  will  concurrently
             therewith be provided for the benefit of the Lenders;

      (f)    any  guarantee  for the benefit  of  the  Subordinated  Creditors,
             provided that a guarantee  substantially  on the same terms (other
             than  with  respect  to  its  subordination)  has   been  or  will
             concurrently  therewith  be  issued for the benefit of the  Senior
             Lenders and that such Subordinated  Guarantee  is provided subject
             to  the  terms  of,  and  in  accordance  with,  the Intercreditor
             Agreement;

      (g)    any  guarantee  for the benefit of the holders of the  Convertible
             Bonds, provided that the same guarantee, ranking equally, has been
             or will concurrently therewith, be provided for the benefit of the
             Subordinated Creditors and that such guarantee is provided subject
             to  the  terms of,  and  in  accordance  with,  the  Intercreditor
             Agreement; and

      (h)    any guarantees and indemnities to which the Facility Agent (acting
             on the instructions  of the Majority Lenders) shall have given its
             prior written consent.

      "PERMITTED INDEBTEDNESS" means any Financial Indebtedness:

      (a)    arising under or permitted pursuant to the Finance Documents;

      (b)    to the extent that such  Financial Indebtedness is subordinated on
             terms acceptable to the Majority Lenders (acting reasonably);

                                       19

<PAGE>


      (c)    pursuant to the Convertible Bonds;

      (d)    [intentionally left blank];

      (e)    arising under Permitted Loans;

      (f)    arising under Permitted Guarantees and Contingent Liabilities;

      (g)    arising   under   and  permitted   by   Clause   23.27   (Treasury
             Transactions) and Clause 23.28 (Hedging);

      (h)    to which the Majority Lenders shall have given their prior written
             consent;

      (i)    [intentionally left blank];

      (j)    incurred under leasing  arrangements  existing at the Signing Date
             in an amount not exceeding a net present value of  [e]5,000,000 at
             any time;

      (k)    incurred  for  leasing  arrangements  over  assets in the ordinary
             course of business in an amount not exceeding  a net present value
             of [e]5,000,000 at any time;

      (l)    incurred by the Issuer in respect of the High Yield  Notes and the
             Exchange Notes;

      (m)    incurred by an Obligor other than the Company,  individually in an
             amount not exceeding  [e]2,000,000 at any time and in aggregate in
             an amount not exceeding  [e]20,000,000 at any time (which may also
             be guaranteed by the Company);

      (n)    incurred by a Group Member that is not an Obligor, individually in
             an amount not exceeding  [e]5,000,000 at any time and in aggregate
             in an amount not  exceeding  [e]30,000,000  at any time (which may
             also be guaranteed by the Company);

      (o)    incurred by the Company under the Bridge Loan or the Funding Loan,
             provided that such Financial Indebtedness is subordinated pursuant
             to the Intercreditor Agreement to the obligations under the Senior
             Facilities;

      (p)    in  the  case  of the  acquisition  of  Fortafil,  an  amount  not
             exceeding [e]10,000,000 of state subsidised Financial Indebtedness
             of such company;

      (q)    incurred with banks or financial  institutions providing lines for
             commercial   letters   of   credit   and   guarantees   (including
             confirmations and avals (Avale)) (but only insofar as they are not
             securing Financial  Indebtedness in excess of [e]10,000,000 in the
             aggregate (or its equivalent in another  currency or  currencies))
             for the Group and having  registered  the maximum amount and tenor
             of such lines (with the approval of the Company) with the Security
             Agent,  provided that the aggregate amount of such lines shall not
             at any time be in excess of  [e]90,000,000  (or its  equivalent in
             another   currency  or  currencies),   which  banks  or  financial
             institutions  are at the Signing Date or at any time  thereafter a
             creditor and accede to the Security Trust  Agreement and therefore
             benefit  from the  Transaction  Security  as a  Secured  Creditor;
             provided  that  any such  creditor  shall  cease  to be a  Secured
             Creditor if:

             (A)   the Company so notifies the Security Agent; and

                                       20

<PAGE>


             (B)   such  Secured  Creditor  confirms in writing to the Security
                   Agent that all claims in respect  to  the relevant Financial
                   Indebtedness incurred have been satisfied in full;

      (r)    incurred by SGL Carbon S.A., Nowy Sacz,, ZEW S.A.,  Raciborz,  and
             SGL Angraph  SP.ZO.O.,  all of them Poland, in an aggregate amount
             of Polish  Zloty  60,000,000,  granted by BNP Paribas  Bank Polska
             S.A.,  Poland,  pursuant to the credit facility  agreement dated 6
             December 2000, as amended by amendment agreement dated 18 December
             2003,  providing  for a facility not  maturing  before 30 December
             2008  under  which  no  repayments  are to be made  prior  to such
             maturity date (other than Polish Zloty  10,000,000 to be repaid on
             31 December 2007);

      (s)    not falling  within  paragraphs (a) to (r) above PROVIDED THAT the
             aggregate  amount of Financial  Indebtedness  falling  within this
             paragraph (s) does not exceed  [e]25,000,000 (or its equivalent in
             another currency or currencies) at any time,

      provided  that  at  no time  shall  the  aggregate  amount  of  Financial
      Indebtedness  falling   within   paragraphs   (m),  (n)  and  (s)  exceed
      [e]50,000,000 (or its equivalent in another currency or currencies).

      "PERMITTED  JOINT  VENTURES"  means Joint Ventures  where  the  aggregate
      amount of net assets transferred  to  the  Joint  Venture does not exceed
      [e] 10,000,000 per annum.

      "PERMITTED LOANS" means:

      (a)    trade credit given by any Group  Member  in the ordinary course of
             and on terms customary in its business;

      (b)    any loans to employees under benefit schemes  PROVIDED  THAT  such
             loans do not exceed [e]5,000,000 at any time;

      (c)    any Intra-Group Loan, PROVIDED THAT:

             (i)   such  Intra-Group  Loan  is specified in the Group Structure
                   Chart;

             (ii)  no Security is taken by the Intra-Group lender in respect to
                   such Intra-Group Loan;

             (iii) the borrower of such Intra-Group  Loan is an Obligor and the
                   lender is another Obligor or, provided that the claims under
                   such Intra-Group Loan are subordinated  to  the  obligations
                   under the Senior Facilities pursuant to a written  agreement
                   to  that  effect, in form and substance satisfactory to  the
                   Facility Agent, a non-Obligor;

             (iv)  the borrower  of such Intra-Group Loan is a non-Obligor, the
                   lender is an Obligor  and  the  aggregate  outstandings from
                   such  Intra-Group  Loans do not exceed [e]40,000,000  at any
                   time; or

             (v)   neither the borrower nor the lender of such Intra-Group Loan
                   are Obligors;

      (d)    the Funding Loans;

                                       21

<PAGE>


      (e)    any loans to which the Majority Lenders  shall  have  given  their
             prior written consent.

      "PERMITTED  MERGER"  means  any  merger  between the following companies,
      provided that any Security granted by the merged companies shall continue
      to be fully effective (where applicable) after  the  merger  and provided
      further  that the surviving company shall become an Obligor prior  to  or
      concurrently  with  the effectiveness of the merger in case of any merger
      involving one or more Obligors:

      (a)    RK  Carbon  International   Ltd.,   Wilmslow,   England,   UK,  RK
             Technologies  International  Ltd., Wilmslow, England, UK, and  SGL
             TECHNIC Ltd., Muir of Ord, Scotland, UK; and

      (b)    SGL ACOTEC (Wuhan) Co. Ltd., Wuhan/China  and  NANTONG  SGL NANBAO
             Graphite Equipment Co. Ltd., Nantong/China,

      and shall also include any merger between non-Obligors to the extent  the
      shares  in  such non-Obligors are not encumbered in favour of the Finance
      Parties.

      "PERMITTED SECURITY" means:

      (a)    any Security  granted  in  connection  with the Original Financing
             Documents, provided that all such Security shall be released on or
             before  31  March  2004  and  the Security listed  in  Schedule  8
             (Existing Security) except to the extent that the principal amount
             of obligations secured by that  Security exceeds the amount stated
             in that Schedule;

      (b)    any  netting  or  set-off  arrangement  entered  into by any Group
             Member in the ordinary course of its banking  arrangements for the
             purpose of netting debit and credit  balances (but not any netting
             or set-off  relating to such hedging  agreement in respect of cash
             collateral  or any other  Security  except as otherwise  permitted
             hereunder);

      (c)    any  Security  arising  by  operation  of law and in the  ordinary
             course of trading  other than by reason of default,  PROVIDED THAT
             any   such    Security    (other    than   a    landlord's    lien
             (Vermieterpfandrecht)         or         contractor's         lien
             (Werkunternehmerpfandrecht) existing in respect of agreements made
             prior to the  Signing  Date) is  discharged  within  ten (10) days
             after having arisen;

      (d)    any  Security  over any  assets  of any  Group  Member  (if  any),
             existing at the Signing  Date,  PROVIDED  THAT the amount  thereby
             secured is not increased  and further  PROVIDED THAT such Security
             shall be released as soon as possible but in any event prior to or
             concurrently with the Closing Date;

      (e)    any  Security  over or  affecting  any asset  acquired  by a Group
             Member  after  the  Signing  Date  and  existing  at the  time  of
             acquisition of such asset if:

             (i)   the  Security  was  not  created  in  contemplation  of  the
                   acquisition of that asset by a Group Member;

             (ii)  the  principal amount secured  has  not  been  increased  in
                   contemplation of or since the acquisition of that asset by a
                   Group Member; and

                                       22

<PAGE>


             (iii) the Security  is  removed  or  discharged  within  three (3)
                   Months of the date of acquisition of such asset;

      (f)    any Security over or affecting  any asset  acquired by any company
             which  becomes a Group  Member after the Signing Date and existing
             on the date on which the relevant  company becomes a Group Member,
             if:

             (i)   the  Security  was  not  created  in  contemplation  of  the
                   acquisition of that company;

             (ii)  the  principal  amount  secured  has  not  been increased in
                   contemplation of or since the acquisition of  that  company;
                   and

             (iii) the  Security  is  removed  or  discharged  within three (3)
                   Months of that company becoming a Group Member;

      (g)    any  retention  of title  arrangement  entered  into by any  Group
             Member in the  normal  course  of its  trading  activities  on the
             counterparty's  standard  or usual  terms to the extent  that such
             terms are customary;

      (h)    any lien in favour of a bank over goods and  documents of title to
             goods  arising  in  the  ordinary  course  of  documentary  credit
             transactions entered into in the ordinary course of trade PROVIDED
             THAT such lien is discharged within fifteen (15) days of arising;

      (i)    any Security arising under the general business  conditions of any
             German  credit  institution  (Kreditinstitut)  or similar  foreign
             institution   with  whom  a  Group  Member   maintains  a  banking
             relationship in its ordinary course of business;

      (j)    any  Security  arising  by  operation  of  law  in  favour  of any
             governmental,  state or  local  authority  in  respect  of  taxes,
             assessments or government charges which are being contested by the
             relevant Group Member in good faith;

      (k)    any security  over real  estate,  equipment,  inventory,  accounts
             receivables, bank accounts or intellectual property rights located
             or  generated  in  Poland  of  the  Group  Members  identified  in
             paragraph (r) of the definition of Permitted Indebtedness, in each
             case,  which is  created  by  mortgages,  one or more  charges  to
             equipment  or  inventory,   assignments  of  accounts  receivable,
             pledges of bank accounts or assignments of  intellectual  property
             rights and secures Financial  Indebtedness  permitted by paragraph
             (r) of the definition of Permitted Indebtedness;

      (l)   any  Security  securing Financial Indebtedness the principal amount
            of which (when aggregated  with  the  principal amount of any other
            Financial  Indebtedness which has the benefit  of  Security  (other
            than any Security  permitted  under  paragraphs  (a) to (k) above))
            does not exceed [e]5,000,000 (or its equivalent in another currency
            or currencies);

      (m)   any first  ranking Security over the Funding Loans in favour of the
            Subordinated Creditors;

      (n)   any Security  given  by  any Group Member for the benefit of the US
            Lenders, provided that the same Security, ranking equally, has been
            or will concurrently therewith  be  provided for the benefit of the
            Lenders;

                                       23

<PAGE>


      (o)   any Security in favour of the Subordinated Creditors; provided that
            Security substantially on the same terms  (other  than with respect
            to  its subordination) has been or will concurrently  therewith  be
            issued for the benefit of the Senior Lenders and that such Security
            is provided  subject  to  the terms of, and in accordance with, the
            Intercreditor Agreement;

      (p)   any Security for the benefit  of  the  holders  of  the Convertible
            Bonds, provided that the same Security, ranking equally,  has  been
            or  will  concurrently therewith be provided for the benefit of the
            Subordinated  Creditors  and that such Security is provided subject
            to  the  terms  of,  and  in  accordance  with,  the  Intercreditor
            Agreement;

      (q)   any Security to which the Majority  Lenders  shall have given their
            prior written consent (PROVIDED THAT the principal  amount  of  the
            indebtedness secured by such Security shall not be increased beyond
            the amount expressly so permitted);

      (r)   any  Security  required to be given by any Group Member pursuant to
            the terms of the Bridge Loan Documents or the High Yield Indenture,
            provided subject  to  the  terms  of,  and  in accordance with, the
            Intercreditor Agreement; and

      (s)   any of the Security created pursuant to the Security Documents.

      "PREPAYMENT ACCOUNT" means an interest-bearing account  or  accounts held
      with  the Security Agent (or such other financial institution  reasonably
      acceptable  to the Facility Agent) in the name of the Company and pledged
      to the Security  Agent (for the benefit of the Finance Parties), and into
      which sums are deposited  in  accordance  with  Clause  9 (Prepayment and
      Cancellation) and may not be withdrawn by any Group Member  other than as
      provided for in Clause 9 (Prepayment and Cancellation).

      "PRIME  BANK"  means  a financial institution with a rating of not  lower
      than A1 (Moody's Investor  Services,  Inc.)  or  A+  (Standard  &  Poor's
      Corporation).

      "QUARTER  DATE"  means  each  of  31  March, 30 June, 30 September and 31
      December.

      "QUOTATION DAY" means, in relation to any  period  for  which an interest
      rate is to be determined:

      (a)    (if the currency is Euro) two (2) TARGET Days before the first day
             of that period; or

      (b)    (for  any other currency) two (2) Business Days before  the  first
             day of that period,

      unless market  practice  differs  in  the Relevant Interbank Market for a
      currency,  in which case the Quotation Day  for  that  currency  will  be
      determined by  the  Facility  Agent in accordance with market practice in
      the Relevant Interbank Market (and  if quotations would normally be given
      by leading banks in the Relevant Interbank  Market  on more than one day,
      the Quotation Day will be the last of those days).

      "REFERENCE BANKS" means Deutsche Bank Luxembourg S.A.,  Dresdner Bank AG,
      Commerzbank Aktiengesellschaft and the principal offices  of  such  other
      banks  or  financial  institutions  as  may  from  time to time be agreed
      between  the  Company  and the Facility Agent in accordance  with  Clause
      27.15 (Reference Banks).

                                       24

<PAGE>


      "REGULATIONS T, U AND X"  means,  respectively, Regulations T, U and X of
      the Board of Governors of the Federal Reserve System of the United States
      (or any successor).

      "RELEASE AGREEMENT" means the release  agreement relating to the Original
      Facilities Agreement entered into on or  about  the  date of signing this
      Agreement  by, inter alia, the Company, certain of its  subsidiaries  and
      certain financial  institutions  for  the  purpose  of  releasing certain
      obligations of the Original Obligors under the Original Finance Documents
      and  certain  security  granted  in connection with the Original  Finance
      Documents.

      "RELEVANT GAAP" means:

      (a)    in respect of the Company, IFRS; and

      (b)    in respect of any other Group  Member  (either  alone or including
             its Subsidiaries) the generally accepted accounting principles and
             practices of its jurisdiction of incorporation.

      "RELEVANT  INTERBANK  MARKET"  means, in relation to Euro,  the  European
      interbank market and, in relation  to  any  other  currency,  the  London
      interbank market.

      "RELEVANT JURISDICTION" means, in respect of any person, the jurisdiction
      of  the  country  in which such person is incorporated and, if different,
      where it is resident  or  has  its  principal place of business, and each
      jurisdiction or state in which it owns  or  leases  property or otherwise
      conducts its business.

      "RELEVANT PERIOD" has the meaning given to it in Clause  22.1  (Financial
      Definitions).

      "REPEATING REPRESENTATIONS" means each of the representations set  out in
      Clause  20.2  (Status)  to  Clause  20.8  (Governing Law and Enforcement)
      (inclusive), Clause 20.11 (No Default and no  Material Adverse Effect) to
      Clause 20.26 (No Immunity) (inclusive), Clause 20.29 (Budgets), paragraph
      (c) of Clause 20.30 (Group Structure Chart) and  Clause  20.32 (ERISA and
      Multiemployer Plans) to Clause 20.36 (Auditors) (inclusive).

      "REVOLVING  CREDIT  FACILITY"  means  the  revolving  loan facility  made
      available under this Agreement as described in Clause 2.1(d).

      "REVOLVING  CREDIT FACILITY CANCELLATION DATE" means a date  on  which  a
      cancellation  of  the  whole  or  part  of the Available Facility for the
      Revolving  Credit  Facility  is to be made under  Clause 9.11  (Voluntary
      Cancellation)  as  specified  in   the   relevant   notice   given  under
      Clause 9.11(a).

      "REVOLVING CREDIT FACILITY COMMITMENT" means:

      (a)    in  relation  to an Original Lender, the Euro Amount set  opposite
             its name under  the heading "Revolving Credit Facility Commitment"
             in Part II of Schedule  1  (The  Original  Parties)  and  the Euro
             Amount   of   any   other  Revolving  Credit  Facility  Commitment
             transferred to it under this Agreement; and

      (b)    in relation to any other  Lender, the Euro Amount of any Revolving
             Credit Facility Commitment transferred to it under this Agreement.

      "REVOLVING CREDIT FACILITY LENDER"  means  a  Lender  providing  Loans in
      accordance with the Revolving Credit Facility.

                                       25

<PAGE>


      "REVOLVING  CREDIT  FACILITY  LOAN" means a loan made or to be made under
      the Revolving Credit Facility or the principal amount outstanding for the
      time being of that loan.

      "REVOLVING  CREDIT  FACILITY  OUTSTANDINGS"   means,  at  any  time,  the
      aggregate  of  the  Euro  Amounts  of  the outstanding  Revolving  Credit
      Facility Loans.

      "RIGHTS  ISSUE"  means  the  proposed  issuance  of  rights  to  purchase
      33,277,437 ordinary shares of the Company.

      "ROLLOVER LOAN" means one or more Revolving Credit Facility Loans:

      (a)    made  or  to be made on the same day  that  a  maturing  Revolving
             Credit Facility Loan is due to be repaid;

      (b)    the aggregate  amount  of  which  is  equal  to  or  less than the
             maturing Revolving Credit Facility Loan;

      (c)    in  the  same  currency as the maturing Revolving Credit  Facility
             Loan (unless it  arose  as a result of the operation of Clause 6.2
             (Unavailability of Dollars)); and

      (d)    made or to be made for the  purpose  of  refinancing such maturing
             Revolving Credit Facility Loan.

      "SCREEN RATE" means:

      (a)    in relation to EURIBOR,  the percentage rate per annum  determined
             by the Banking  Federation of the European  Union for the relevant
             period; and

      (b)    in  relation  to  LIBOR, the British Bankers' Association Interest
             Settlement Rate for the relevant currency and period,

      displayed on the appropriate  page  of  the Reuters screen. If the agreed
      page is replaced or service ceases to be  available,  the  Facility Agent
      may specify another page or service displaying the appropriate rate after
      consultation with the Company and the Lenders.

      "SECURED  CREDITOR"  means any bank or financial institution which  is  a
      creditor of any Group  Member  under any Permitted Indebtedness Agreement
      (as  defined in the Security Trust  Agreement)  from  time  to  time  and
      entitled  to  the  same security rights as the Finance Parties under this
      Agreement  after  accession   to   the   Security  Trust  Agreement  upon
      notification to the Security Agent by the  Company  pursuant to the terms
      of the Security Trust Agreement. Such Secured Creditor  will benefit from
      the  Transaction  Security  up  to  its  Secured Creditor's Participation
      Amount as notified by the Company. The Security  Agent  will keep updated
      lists  of  the Secured Creditors and their respective Secured  Creditor's
      Participation Amounts by means of the List of Secured Parties.

      "SECURED  CREDITORS  MAXIMUM  SECURED  AMOUNT  means  an  amount  of  [e]
      90,000,000  at maximum  which will be applied  from the  proceeds  of the
      enforcement of the Transaction Security pursuant to the provisions of the
      Security Trust  Agreement in order to discharge the claims of any Secured
      Creditor  in   accordance   with  the   respective   Secured   Creditor's
      Participation Amounts as notified by the Company.

      "SECURED  CREDITOR'S  PARTICIPATION  AMOUNT" has the meaning ascribed  to
      such term in the Security Trust Agreement.

                                       26

<PAGE>


      "SECURED PARTIES" means the Finance Parties,  the  Hedging Counterparties
      and the other Secured Creditors, each a "SECURED PARTY".

      "SECURITY"  means  a  mortgage,  charge, pledge, lien or  other  security
      interest securing any obligation of  any person or any other agreement or
      arrangement having a similar effect.

      "SECURITY DOCUMENTS" means:

      (a)    each document referred to in paragraph 3 of Part I, in Part II and
             in paragraph 13 of Part III of  Schedule  2  (Conditions Precedent
             and Conditions Subsequent);

      (b)    any Cash Collateral Document; and

      (c)    any  other document entered into by any Group Member  creating  or
             evidencing or purporting to create or evidence Security for all or
             any part  of  the obligations of the Obligors or any of them under
             the Finance Documents or any of them.

      "SECURITY  TRUST  AGREEMENT"   means   the   security   trust  agreement,
      substantially in the form set out in Schedule 11 (Form of  Security Trust
      Agreement)  to  be  made  between, amongst others, the Obligors  and  the
      Secured Parties.

      "SELECTION NOTICE" means a  notice  substantially  in the form set out in
      Part  II  of  Schedule  3 (Requests) given in accordance  with  Clause 11
      (Interest Periods and the  Term)  in relation to Term Facility A and Term
      Facility B.

      "SENIOR FACILITIES" means the Facilities and the US Term Loan Facility.

      "SENIOR LENDERS" means the Lenders and the US Term Lenders.

      "SIGNING DATE" means 3 February 2004,  the  date  of  execution  of  this
      Agreement.

      "SPECIFIED  TIME"  means a time determined in accordance with Schedule 10
      (Timetables).

      "SUBFACILITIES" means any facilities made available by a Subfacility Bank
      pursuant  to and in accordance  with  Clause  5.10  (Utilisation  of  the
      Subfacilities) and each not exceeding an amount of [e]10,000,000 in total
      at any given time and "SUBFACILITY" shall be construed accordingly.

      "SUBFACILITY BANK" means  each  Revolving  Credit  Facility  Lender which
      becomes a Subfacility Bank by operation of Clause 2.2 (Subfacilities).

      "SUBFACILITY  DOCUMENTS"  means  any  documents setting out the terms  on
      which the Subfacilities are made available as agreed between the relevant
      Borrower, Subfacility Bank and approved by the Facility Agent.

      "SUBORDINATED CREDITORS" means the Exchange Notes Investors, the Exchange
      Notes Trustee, the High Yield Investors and the Bridge Lenders.

      "SUBORDINATED DEBT" has the meaning given to it in Clause 22.1 (Financial
      Definitions).

      "SUBORDINATED FINANCE DOCUMENTS" means,  collectively,  the  Bridge  Loan
      Documents,   the  Exchange  Notes,  the  Funding  Loan,  the  High  Yield
      Indenture, and the High Yield Notes.

                                       27

<PAGE>


      "SUBORDINATED  FINANCE  PARTIES"  means  any  Subordinated  Creditor, the
      Bridge  Loan Agent, any other agent under the Bridge Loan Documents,  the
      Exchange  Notes  Security Agent, the Exchange Notes Trustee, the Exchange
      Notes Escrow Agent,  the  High Yield Trustee and the Bridge Arrangers and
      "SUBORDINATED FINANCE PARTY" means any of them.

      "SUBORDINATED GUARANTEES" means  the  guarantees  to  be  provided by the
      Subordinated Guarantors for the benefit of the Subordinated Creditors and
      the holders of the Convertible Bonds in relation to the High Yield Notes,
      the Exchange Notes, the Bridge Loans and/or the Convertible Bonds, as the
      case  may  be,  in  each  case  issued  subject  to  the  terms  of,  and
      subordinated  to  the claims of the Senior Lenders in accordance with the
      provisions set forth in, the Intercreditor Agreement.

      "SUBORDINATED GUARANTORS"  means  (a)  with  respect to the Bridge Loans,
      each of the Guarantors, to the extent legally  permissible;  and (b) with
      respect  to the High Yield Notes, the Company and certain Guarantors,  to
      the extent legally permissible.

      "SUBSIDIARY"   means,   in   relation  to  any  company,  corporation  or
      partnership, a company, corporation or partnership:

      (a)    a  company, corporation  or  partnership  which  is  "controlled",
             directly   or   indirectly,  by  and  therefore  is  a  "dependent
             enterprise" (abhangiges   Unternehmen)  of   the   first mentioned
             company,  partnership or corporation, in the case of  the  latter,
             within the  meaning  of  Sec. 17  of  the  Stock  Corporation  Act
             (Aktiengesetz),  or  which  is a "subsidiary" (Tochterunternehmen)
             within   the  meaning  of  Sec. 290   of   the   Commercial   Code
             (Handelsgesetzbuch) of such company, corporation or partnership;

      (b)    a company, corporation or partnership more than half of the issued
             share  capital   or  issued  voting  share  capital  of  which  is
             beneficially owned, directly or indirectly, by the first mentioned
             company, corporation or partnership;

      (c)    a partnership in which:

             (i)   there is a participation  of  more than fifty (50) per cent.
                   in the assets of such partnership  by  the  first  mentioned
                   company, corporation or partnership; or

             (ii)  the first mentioned company, corporation or partnership  has
                   the  power to (A) cast, or control the casting of, more than
                   fifty  (50)  per  cent.  of the maximum number of votes that
                   might be cast at a general  meeting,  (B)  appoint or remove
                   all,  or the majority of, the directors or other  equivalent
                   officers,  or  (C)  give  directions  with  respect  to  the
                   operating  and  financial  policies  which  the directors or
                   other  equivalent  officers  thereof are obliged  to  comply
                   with; or

            (iii)  in the case of a limited partnership,  the  general  partner
                   has  control  over  such  limited  partnership and the first
                   mentioned company, corporation or partnership has control of
                   the general partner,

      and,  for this purpose, a company, corporation or  partnership  shall  be
      treated as being controlled by another if that other company, corporation
      or partnership  is  able  to  direct  its  affairs  and/or to control the
      composition of its board of directors or equivalent body.

                                       28

<PAGE>


      "TARGET"  means  Trans-European  Automated  Real-time  Gross   Settlement
      Express Transfer payment system.

      "TARGET DAY" means any day on which TARGET is open for the settlement  of
      payments in Euro.

      "TAX" means any tax, levy, impost, duty or other charge or withholding of
      a similar nature (including any penalty or interest payable in connection
      with  any  failure  to pay or any delay in paying any of the same) by any
      Government Agency.

      "TENDER OFFER" as defined in Clause 23.41 (Tender Offer).

      "TERM" means, in relation  to  any  Letter of Credit, the period from its
      Utilisation Date until its Expiry Date.

      "TERM  FACILITIES"  means Term Facility  A,  Term  Facility  B  and  Term
      Facility C, and "TERM FACILITY" shall be construed accordingly.

      "TERM FACILITY A" means  a  term  loan facility made available under this
      Agreement as described in Clause 2.1(a).

      "TERM FACILITY A COMMITMENT" means:

      (a)    in  relation  to  an Original Lender,  the  amount  in  Euros  set
             opposite its name under  the  heading "Term Facility A Commitment"
             in Part II of Schedule 1 (The Original  Parties) and the amount in
             Euros of any other Term Facility A Commitment transferred to it in
             accordance with this Agreement; and

      (b)    in relation to any other Lender, the amount  in  Euros of any Term
             Facility  A Commitment transferred to it in accordance  with  this
             Agreement,

      to the extent not  cancelled,  reduced or transferred by it in accordance
      with this Agreement.

      "TERM  FACILITY A LOAN" means a loan  made  or  to  be  made  under  Term
      Facility A or the principal amount outstanding for the time being of that
      loan.

      "TERM FACILITY A OUTSTANDINGS" means, at any time, the amount in Euros of
      the outstanding Term Facility A Loan.

      "TERM FACILITY A REPAYMENT DATE" means each of the dates specified in the
      table in Clause 7.1 (Repayment of Term Facility A Loan).

      "TERM FACILITY  B"  means  a  term  facility  made  available  under this
      Agreement as described in Clause 2.1(b).

      "TERM FACILITY B COMMITMENT" means:

      (a)    in  relation  to  an  Original  Lender,  the  amount  in Euros set
             opposite  its  name under the heading "Term Facility B Commitment"
             in Part II of Schedule  1 (The Original Parties) and the amount in
             Euros of any other Term Facility B Commitment transferred to it in
             accordance with this Agreement; and

      (b)    in relation to any other  Lender,  the amount in Euros of any Term
             Facility B Commitment transferred to  it  in  accordance with this
             Agreement,

                                       29

<PAGE>


      to the extent not cancelled, reduced or transferred by  it  in accordance
      with this Agreement.

      "TERM  FACILITY B EXCESS EXPOSURE" means the excess of (i) the  aggregate
      amount of  the  Term  Facility B Outstandings plus the maximum actual and
      contingent liabilities  of  the  Issuing Banks in respect of any proposed
      Letter  of  Credit  (including,  for the  avoidance  of  doubt,  interest
      accruing on such Letter of Credit)  over  (ii)  the Total Term Facility B
      Commitments  plus  the  sum of the aggregate amount  of  Cash  Collateral
      provided in respect of any  Letter of Credit in accordance with para. (b)
      of Clause 23.31 (Mandatory Cash Collateral).

      "TERM FACILITY B LENDER" means a Lender having committed funds under Term
      Facility B pursuant to its Term Facility B Commitment.

      "TERM FACILITY B LOAN" means,  upon  conversion of the Term Facility B in
      accordance with Clause 8.7 (Conversion  of  Term  Facility  B upon demand
      under  Letter  of  Credit), the loan deemed to have been made under  Term
      Facility B or the principal amount outstanding for the time being of that
      loan.

      "TERM FACILITY B OUTSTANDINGS"  means,  at any time, the aggregate amount
      of (i) the maximum actual and contingent liabilities of the Issuing Banks
      in respect of the issued Letters of Credit  (including, for the avoidance
      of doubt, interest accruing thereon); and (ii)  upon  conversion  of  any
      Letter  of  Credit  in  accordance  with  Clause  8.7 (Conversion of Term
      Facility  B  upon demand under Letter of Credit), the  aggregate  of  the
      amount in Euros of the outstanding Term Facility B Loans.

      "TERM FACILITY  C"  means  a term loan facility made available under this
      Agreement as described in Clause 2.1(c).

      "TERM FACILITY C COMMITMENT" means:

      (a)    in  relation  to an Original  Lender,  the  amount  in  Euros  set
             opposite its name  under  the heading "Term Facility C Commitment"
             in Part II of Schedule 1 (The Original Parties); and

      (b)    in relation to any other Lender,  the  amount in Euros of any Term
             Facility C Commitment transferred to it  in  accordance  with this
             Agreement,

      to  the  extent not cancelled, reduced or transferred by it in accordance
      with this Agreement.

      "TERM FACILITY  C  LOAN" means the loan made under Term Facility C or the
      principal amount outstanding for the time being of that loan.

      "TERM FACILITY C OUTSTANDINGS"  means,  at any time, the aggregate of the
      amount in Euros of the outstanding Term Facility C Loan.

      "TERM FACILITY C REPAYMENT DATE" means each of the dates specified in the
      table in paragraph (a) of Clause 7.3 (Repayment of Term Facility C Loan).

      "TERM FACILITY C REPAYMENT INSTALMENT" means  the  amount  by  which  the
      amount of the outstanding Term Facility C Loan drawn by the Company is to
      be  reduced on a Term Facility C Repayment Date in accordance with Clause
      7.3(a).

                                       30

<PAGE>


      "TERM FACILITY LOANS" means the Term Facility A Loan, the Term Facility B
      Loan,  and  the  Term  Facility C Loan, and "TERM FACILITY LOAN" shall be
      construed accordingly.

      "TERMINATION DATE" means:

      (a)    in relation to Term Facility A, 30 December 2008;

      (b)    in relation to Term Facility B, 30 December 2008;

      (c)    in relation to Term Facility C, 30 September 2007; and

      (d)    in relation to the Revolving Credit Facility, 30 December 2008.

      "TOTAL COMMITMENTS" means  the  aggregate  of  the  Total Term Facility A
      Commitments,  the  Total  Term  Facility  B Commitments, the  Total  Term
      Facility   C  Commitments  and  the  Total  Revolving   Credit   Facility
      Commitments.

      "TOTAL REVOLVING  CREDIT FACILITY COMMITMENTS" means the aggregate of the
      Revolving Credit Facility Commitments.

      "TOTAL TERM FACILITY  A  COMMITMENTS"  means  the  aggregate  of the Term
      Facility A Commitments.

      "TOTAL  TERM  FACILITY  B  COMMITMENTS"  means the aggregate of the  Term
      Facility B Commitments.

      "TOTAL  TERM FACILITY C COMMITMENTS" means  the  aggregate  of  the  Term
      Facility C Commitments.

      "TOTAL TERM  FACILITY  COMMITMENTS"  means  the  Total  Term  Facility  A
      Commitments,  the  Total  Term  Facility B Commitments and the Total Term
      Facility C Commitments, and "TOTAL  TERM  FACILITY  COMMITMENT"  shall be
      construed accordingly.

      "TRANSACTION  SECURITY"  means  any  Security  for all or any part of the
      obligations of the Obligors or any of them under the Finance Documents or
      any of them expressed to be created by or pursuant to, or to be evidenced
      in, the Security Documents or any of them.

      "TRANSFER CERTIFICATE" means a certificate substantially  in  one  of the
      forms  set out in Schedule 5 (Form of Transfer Certificates) or any other
      form agreed between the Facility Agent and the Company.

      "TRANSFER DATE" means, in relation to a transfer, the later of:

      (a)    the  proposed Transfer Date specified in the Transfer Certificate;
             and

      (b)    the date  on  which  the  Facility  Agent  executes  the  Transfer
             Certificate.

      "TREASURY  TRANSACTION"  means any currency or interest purchase, cap  or
      collar agreement, forward  rate  agreement,  interest  rate  or  currency
      future or option contract, foreign exchange or currency purchase or  sale
      agreement,  interest  rate  swap, currency swap or combined interest rate
      and currency swap agreement and any other similar agreement.

      "UNPAID SUM" means any sum due and payable but unpaid by an Obligor under
      the Finance Documents.

                                       31

<PAGE>


      "US COMPETITION LAW LIABILITIES"  means  the fines imposed on the Company
      or any Group Member by the U.S. Department  of  Justice  in  relation  to
      Existing Competition Law Proceedings in the USA in the outstanding amount
      as of the Signing Date of USD 79,250,000.

      "US  COMPETITION  LAW  PROCEEDINGS"  means  the  Existing Competition Law
      Proceedings initiated by the U.S. Department of Justice.

      "US GROUP MEMBER" means any Group Member incorporated,  resident  or with
      its  principal  place of business in the United States of America or  any
      state thereof or  which  owns  or  leases  property or otherwise conducts
      business in the United States of America or any state thereof.

      "US TERM LENDERS" means the lenders making available  the  US  Term Loans
      from time to time.

      "US TERM LOANS" means the loans made by the US Term Lenders to SGL Carbon
      LLC under and in accordance with the US Term Loan Agreement.

      "US  TERM LOAN AGREEMENT" means the loan agreement dated 3 February  2004
      between,  inter  alia,  SGL  Carbon LLC as borrower and certain financial
      institutions as lenders providing for US Dollar denominated term loans in
      an aggregate amount of up to USD  116,000,000,  as  amended  from time to
      time.

      "US  TERM  LOAN  FACILITY"  means  the  senior  secured  credit  facility
      documented by the US Term Loan Agreement.

      "UTILISATION" means a utilisation of a Facility by way of Loan or (in the
      case of the Term Facility B) Letter of Credit.

      "UTILISATION  DATE"  means  the date of a Utilisation, being the date  on
      which the relevant Loan is made  or  to  be made or a Letter of Credit is
      issued or to be issued.

      "UTILISATION REQUEST" means a notice substantially in the form set out in
      Part I of Schedule 3 (Requests).

      "VAT" means value added tax and any other tax of a similar nature.

1.2   CONSTRUCTION

(a)   Any reference in this Agreement to:

      (i)    a document being in the "AGREED FORM" is a reference to a document
             which is either initialled as such  on  or before the Closing Date
             for the purposes of identification by or  on behalf of the Company
             and  the  Mandated Lead Arrangers or the Facility  Agent  (or  any
             other party  to any such document) or is executed on or before the
             Signing  Date by  any  of  the  Obligors  and  the  Mandated  Lead
             Arrangers  or  the  Facility  Agent  or,  if  not  so  executed or
             initialled,  is  in form and substance reasonably satisfactory  to
             the Facility Agent;

      (ii)   "ASSETS" includes  present  and  future  properties,  revenues and
             rights of every description;

                                       32

<PAGE>


      (iii)  the  "EUROPEAN  INTERBANK  MARKET" means the interbank market  for
             Euro operating in Participating Member States;

      (iv)   a "FINANCE DOCUMENT" or any  other  agreement  or  instrument is a
             reference   to  that  Finance  Document  or  other  agreement   or
             instrument as amended or novated;

      (v)    "INDEBTEDNESS"   includes  any  obligation  (whether  incurred  as
             principal or as surety)  for  the  payment  or repayment of money,
             whether present or future, actual or contingent;

      (vi)   a  Lender's/Issuing  Bank's "PARTICIPATION", in  relation  to  the
             Letter(s) of Credit, shall  be  construed  as  a  reference to its
             rights and obligations in relation to that Letter of Credit as are
             expressly set out in this Agreement;

      (vii)  a  "PERSON"  includes  any  person,  firm,  company,  corporation,
             government,  state or agency of a state or any association,  trust
             or partnership  (whether or not having separate legal personality)
             or two or more of the foregoing;

      (viii) a "REGULATION" includes  any regulation, rule, official directive,
             request or guideline (whether  or not having the force of law; but
             if  not  having the force of law,  being  one  with  which  it  is
             customary  for  persons  to  whom it is directed to comply) of any
             governmental, intergovernmental  or  supranational  body,  agency,
             department  or  regulatory, self-regulatory or other authority  or
             organisation;

      (ix)   a provision of law  is a reference to that provision as amended or
             re-enacted; and

      (x)    unless a contrary indication appears, a time of day is a reference
             to Brussels time.

(b)   Section, Clause and Schedule headings are for ease of reference only.

(c)   Unless a contrary indication  appears,  a  term used in any other Finance
      Document or in any notice given under or in  connection  with any Finance
      Document has the same meaning in that Finance Document or  notice  as  in
      this Agreement.

(d)   A  Default (other than an Event of Default) is "CONTINUING" if it has not
      been remedied or waived and an Event of Default is "CONTINUING" if it has
      not been waived.

1.3   CURRENCY DEFINITIONS

In this Agreement:

(a)   "$"  and  "DOLLARS"  denote  the  lawful currency of the United States of
America;

(b)   "[e]" and "EURO" denote the single currency of the  Participating  Member
States; and

(c)   "{pound-sterling}"  and  "STERLING"  denote  the  lawful  currency of the
United Kingdom.

                                       33

<PAGE>


                                   SECTION 2

                                THE FACILITIES

2.   THE FACILITIES

2.1  THE FACILITIES

     Subject  to  the  terms of this Agreement, the Lenders make available  the
     Facilities referred to below to the relevant Borrowers in relation to each
     such Facility:

      (a)  (to SGL Carbon S.A., Spain and SGL Carbon S.p.A., Italy) a term loan
           facility in Euros  in  an  aggregate  amount equal to the Total Term
           Facility A Commitments;

      (b)  (to the Company) a term facility in Euros  in  an  aggregate  amount
           equal to the Total Term Facility B Commitments;

      (c)  (to  the  Company)  a  term facility in Euros in an aggregate amount
           equal to the Total Term Facility C Commitments; and

      (d)  (to the Company) a multicurrency  revolving  credit  facility  in an
           aggregate  amount  equal  to  the  Total  Revolving  Credit Facility
           Commitments to be made available by way of revolving loans,  letters
           of  credit,  bank  guarantees  and,  in  accordance  with Clause 2.2
           (Subfacilities), by way of Subfacilities.

2.2   SUBFACILITIES

(a)   Subject  to  the terms of this Agreement, any Borrower may, at  any  time
      during  the  Availability  Period  applicable  to  the  Revolving  Credit
      Facility,  by notice  in  writing  to  the  Facility  Agent  request  the
      conversion of  the  whole  or  part  of  the  Available  Revolving Credit
      Facility into a Subfacility with effect from the date specified  in  such
      notice  being  a date not less than five (5) Business Days after the date
      such notice is received  by the Facility Agent (the "EFFECTIVE DATE") and
      further provided that not  more than three (3) Subfacilities are existing
      at the same time. Any such notice shall specify:

      (i)    the proposed Subfacility Bank;

      (ii)   the proposed Borrower; and

      (ii)   the amount of the proposed Subfacility,

      and shall contain the approval  by  the  relevant Subfacility Bank of its
      acting as Subfacility Bank and of the terms  of the proposed Subfacility,
      and the Facility Agent shall promptly notify each  Lender upon receipt of
      any such notice.

(b)   Any  Revolving  Credit  Facility  Lender  may become a Subfacility  Bank;
      however, no Revolving Credit Facility Lender  shall  be  obliged  to make
      available Subfacilities under this Clause 2.2 (Subfacilities).

(c)   In  the  event  of  the establishment of a Subfacility in accordance with
      this  Clause 2.2 (Subfacilities),  then  with  effect  on  and  from  the
      Effective  Date, the Total Revolving Credit Facility Commitments shall be
      reduced  by the  amount  of  the  Subfacility,  but  shall  automatically
      increase by  the  amount  of  the relevant Subfacility upon a Subfacility
      ceasing

                                       34

<PAGE>


      to be available to the  relevant Borrower or upon  the  Subfacility being
      cancelled in accordance with Clause 2.2(d) below.

(d)   Any Borrower which has requested  the  establishment of a Subfacility may
      at any time by notice in writing to the  Facility  Agent and the relevant
      Subfacility Bank cancel such Subfacility in whole or  in  part,  in which
      event on the date specified in the notice, being a date not less than ten
      (10) Business Days after the date such notice is received by the Facility
      Agent, the Subfacility shall be cancelled and the relevant Borrower shall
      immediately repay or pay all amounts outstanding under such Subfacility.

(e)   No  Subfacility  Bank  may  (other  than  at  maturity  of  the  relevant
      Subfacility),   until   notice   has   been  served  under  Clause  24.22
      (Acceleration) or an automatic cancellation  has  occurred  under  Clause
      24.23  (US Obligors) demand repayment of any monies made available by  it
      or withdraw  prior  to its original maturity any Subfacility or the right
      to make utilisations  thereunder (unless an Event of Default has occurred
      which has not been waived  by  the Majority Lenders) or demand cash cover
      in respect of any guarantee or similar contingent liability by it or take
      any action analogous to any of the foregoing under the Subfacility.

2.3   FINANCE PARTIES' RIGHTS AND OBLIGATIONS

(a)   The obligations of each Lender,  each  Subfacility  Bank and each Issuing
      Bank  under the Finance Documents are several. Failure  by  a  Lender,  a
      Subfacility  Bank or an Issuing Bank to perform its obligations under the
      Finance Documents  does  not  affect  the  obligations of any other Party
      under  the Finance Documents. No Finance Party  is  responsible  for  the
      obligations of any other Finance Party under the Finance Documents.

(b)   The rights  of  each  Lender, each Subfacility Bank and each Issuing Bank
      under or in connection  with  the  Finance  Documents  are  separate  and
      independent  rights  and any debt arising under the Finance Documents or,
      as the case may be, the  Subfacility Documents to a Lender, a Subfacility
      Bank or, as the case may be,  a  Issuing  Bank from an Obligor shall be a
      separate  and  independent  debt. The creation  of  jointly  held  assets
      (Gesamthandsvermogen) is excluded.

(c)   A Finance Party may, except as  otherwise stated in the Finance Documents
      and  subject  to  the  terms of the Intercreditor  Agreement,  separately
      enforce its rights under  the  Finance  Documents  PROVIDED  THAT  if any
      Lender commences proceedings in respect of the Finance Documents it shall
      promptly  notify  the  other  Lenders  through the Facility Agent and the
      Facility Agent shall notify the other Lenders accordingly.

3.    PURPOSE

3.1   PURPOSE

(a)   Each Borrower shall apply all amounts borrowed  by it under Term Facility
      A in or towards discharging its share of the Existing Indebtedness.

(b)   The Company shall utilize Term Facility B for the  purpose  of  replacing
      the  Original Letter of Credit and in or towards the issue of Letters  of
      Credit  for  the  Original  EU  Competition  Law  Liabilities,  including
      interest accruing thereon at the respective rate.

(c)   The Company shall apply all amounts borrowed by it under Term Facility  C
      in or towards discharging the amounts outstanding under the Original Term
      Facility C.

                                       35

<PAGE>


(d)   The  Company  shall  apply all amounts borrowed by it under the Revolving
      Credit Facility in or  towards  financing  the general corporate purposes
      and refinancing of existing working capital  facilities of the Group (but
      not to fund:

      (i)    the  making  or declaration of any dividend,  return  on  capital,
             repayment of capital  contributions or other distribution (whether
             in cash or kind) or making  of  any  other  payment  whatsoever in
             respect  of  share capital whether directly or indirectly  by  the
             Company;

      (ii)   the refinancing of the Convertible Bond;

      (iii)  the financing of cartel fines or Cash Collateral relating thereto;
             or

      (iv)   the refinancing of any other Financial Indebtedness incurred after
             the Signing Date).

(e)   The  Company  shall  apply   all   amounts   borrowed  by  it  under  the
      Subfacilities and utilise all other banking arrangements comprised in the
      Subfacilities,  for  the general working capital  requirements  or  other
      general corporate purposes of the Group.

3.2   MONITORING

      No Finance Party is bound  to  monitor  or  verify the application of the
      proceeds of, or the use of, any Utilisation pursuant to this Agreement.

4.    CONDITIONS OF UTILISATION

4.1   CONDITIONS PRECEDENT TO EFFECTIVENESS OF FINANCE DOCUMENTS

      This  Agreement  and the other Finance Documents  become  effective  upon
      receipt by the Facility  Agent  of  all  the documents and other evidence
      listed  in  Part  0 of Schedule 2 (Conditions  Precedent  and  Conditions
      Subsequent) in form and substance satisfactory to the Facility Agent. The
      Facility Agent shall  notify  the  Company  and the Lenders promptly upon
      being so satisfied.

4.2   INITIAL CONDITIONS PRECEDENT

      No Borrower may deliver a Utilisation Request  unless  the Facility Agent
      has received all of the documents and other evidence listed  in Part I of
      Schedule 2 (Conditions Precedent and Conditions Subsequent) in  form  and
      substance  satisfactory  to  the Facility Agent. The Facility Agent shall
      notify the Company and the Lenders promptly upon being so satisfied.

4.3   FURTHER CONDITIONS PRECEDENT

      The Lenders and the Issuing Banks  will  only  be  obliged to comply with
      Clause 5.4 (Lenders' and Issuing Banks' Participation)  if on the date of
      the Utilisation Request and on the proposed Utilisation Date:

      (a)   in the case of a Rollover  Loan, no Event of Default (other than an
            Event of  Default  pursuant  to Clause  24.18 (b)  during  the time
            period reserved for negotiations of the parties set out therein) is
            continuing or would result from the proposed  Rollover Loan and, in
            the case of any other  Loan or  Letter of  Credit,  no  Default  is
            continuing  or would  result  from the  proposed  Loan or Letter of
            Credit;

                                       36

<PAGE>


      (b)   the  Repeating  Representations  made or  deemed  to be made by the
            Company and each other Obligor are true in all material respects;

      (c)   no Change of Control has occurred.

4.4   MAXIMUM NUMBER OF LOANS

(a)   A Borrower may not deliver a Utilisation Request if as  a  result  of the
      proposed  Utilisation  more than ten (10) Revolving Credit Facility Loans
      would be outstanding.

(b)   A Borrower may only deliver  one  Utilisation  Request in relation to the
      Term Facility A Loan and the Term Facility C Loan.



                                   SECTION 3

                                  UTILISATION

5.    UTILISATION

5.1   DELIVERY OF A UTILISATION REQUEST

      A Borrower may utilise a Facility made available to it by delivery to the
      Facility Agent of a duly completed Utilisation Request not later than the
      Specified Time.

5.2   COMPLETION OF A UTILISATION REQUEST

(a)   Each  Utilisation  Request is irrevocable and will  not  be  regarded  as
      having been duly completed unless:

      (i)    it identifies the Facility to be utilised;

      (ii)   the proposed  Utilisation  Date  is  a  Business  Day  within  the
             Availability Period applicable to that Facility;

      (iii)  the  currency and amount of the Utilisation comply with Clause 5.3
             (Currency and Amount);

      (iv)   the proposed Interest Period or, as the case may be, Term complies
             with Clause 11 (Interest Periods and the Term);

      (v)    in relation to a Loan, it provides payment instructions; and

      (vi)   in relation  to  a  Letter  of  Credit,  the Issuing Banks and the
             Facility  Agent  have  prior to the delivery  of  the  Utilisation
             Request approved its terms  (which,  unless the Facility Agent and
             the Issuing Banks agree otherwise, shall  be  substantially in the
             form  set  out  in  Schedule 14 (Form of Letter of  Credit)),  the
             purpose of its issue and the identity of the beneficiary.

(b)   Only one Loan or Letter of Credit  may  be  requested in each Utilisation
      Request.

                                       37

<PAGE>


5.3   CURRENCY AND AMOUNT

(a)   The currency specified in a Utilisation Request in relation to:

      (i)    the  Term  Facility  A  Loan, the Letters  of  Credit  under  Term
             Facility B and the Term Facility C Loan must be Euros; and

      (ii)   a Revolving Credit Facility Loan must be Euros or Dollars.

(b)   Neither the:

      (i)    amount in Euros of the Term Facility A Loan, the Letters of Credit
             under Term Facility B or the Term Facility C Loan; nor

      (ii)   the Euro Amount of a proposed Revolving Credit Facility Loan,

      may exceed the applicable Available Commitment.

(c)   The amount of a proposed Revolving Credit Facility Loan must be:

      (i)   if the currency selected is Euros, a minimum of [e]5,000,000 and an
            integral  multiple  of  [e]1,000,000  or, if less,  the  applicable
            Available Facility; or

      (ii)  if the currency  selected is Dollars,  a minimum of $ 5,000,000 and
            an integral  multiple of $ 1,000,000  or, if less,  the  applicable
            Available Facility.

(d)   The  amount  in Euros of the Term Facility A Loan must be  equal  to  the
      Total Term Facility A Commitments.

(e)   The amount in Euros of the proposed Term Facility C Loan must be equal to
      the Total Term Facility C Commitments.

5.4   LENDERS' AND ISSUING BANKS' PARTICIPATION

(a)   If the conditions set out in this Agreement have been met:

      (i)    each Lender shall make its participation in each Loan available by
             the Utilisation Date through its Facility Office; and

      (ii)   each Issuing  Bank  shall  issue  any  Letter  of  Credit  by  the
             Utilisation Date through its Facility Office.

(b)   The amount of each Lender's participation in the Term Facility Loans will
      be  equal  to  the  proportion  borne  by its Available Commitment to the
      Available   Facility,  in  relation  to  the  relevant   Term   Facility,
      immediately prior to the making of such Term Facility Loan.

(c)   The amount of  each  Issuing  Bank's  participation in a Letter of Credit
      will be equal to the proportion borne by  its Available Commitment to the
      Available  Facility immediately prior to the  issue  of  such  Letter  of
      Credit.

(d)   The amount of  each  Lender's  participation  in  each  Revolving  Credit
      Facility  Loan  (other  than  under  a  Subfacility) will be equal to the
      proportion borne by its Available Commitment  to  the  Available Facility
      immediately prior to the making of such Revolving Credit Facility Loan.

                                       38

<PAGE>


(e)   No  Revolving Credit Facility Loan shall be made on any Utilisation  Date
      if,  as  a  result,  the  aggregate  of  all  Revolving  Credit  Facility
      Outstandings  on  that Utilisation Date when aggregated at that time with
      the amount of all Subfacilities  effective  at that time shall exceed the
      aggregate   of  the  Revolving  Credit  Facility  Commitments   on   that
      Utilisation Date.

(f)   The Facility  Agent shall notify each Lender the currency, the amount and
      the Interest Period  in  relation  to of each Loan or Letter of Credit at
      the Specified Time.

5.5   [INTENTIONALLY LEFT BLANK]

5.6   CANCELLATION OF A FACILITY

      If,  prior  to the date on which it receives  a  Utilisation  Request  in
      respect  of  a   Facility,  the  Facility  Agent  receives  a  notice  of
      cancellation of the  whole  or  part  of  the Available Facility for such
      Facility   which   is   to  take  effect  under  Clause 9.11   (Voluntary
      Cancellation) on a date falling  on  or  after  such date, such Available
      Facility  shall be treated, for the purpose of Clause 5.3  (Currency  and
      Amount), as  if  it  had  already  been  reduced  by  the  amount of such
      cancellation  (as  specified in such notice). Nothing in this  Clause 5.6
      shall be treated as reducing any Lender's Available Commitment under that
      Facility for the purposes  of  Clause 13.1  (Commitment Fee) prior to the
      date on which such cancellation would otherwise take effect.

5.7   CANCELLATION OF A LENDER'S COMMITMENT

      If a Lender's Commitment is cancelled under Clause  9.1  (Illegality)  or
      Clause  9.12 (Right of repayment and cancellation in relation to a single
      Lender  or  Issuing  Bank)  after  the  Facility  Agent  has  received  a
      Utilisation  Request  but  before  the Loan requested in that Utilisation
      Request has been made, then the amount  of  that Loan shall be reduced by
      the proportion which such Lender's Term Facility  Commitment or Revolving
      Credit Facility Commitment bore to the Total Term Facility Commitments or
      the  Total Revolving Credit Facility Commitments (as  the  case  may  be)
      immediately prior to such cancellation taking effect.

5.8   CANCELLATION AND REPLACEMENT OF LETTER OF CREDIT

(a)   The Company  shall  use  its  reasonable  efforts  to  cause the European
      Commission  to  return  any  Letter  of  Credit to the Issuing  Banks  in
      exchange against a new Letter of Credit in each case if and to the extent
      an Issuing Bank in respect of such Letter  of  Credit  is not also a Term
      Facility B Lender.

(b)   However, the Company shall also use its reasonable efforts  to  cause the
      European  Commission to return any Letter of Credit to the Issuing  Banks
      or cause the  European Commission to release the Issuing Banks from their
      liabilities under such Letter of Credit upon:

      (i)    the European Commission waiving the requirement for such Letter of
             Credit to be issued; and

      (ii)   in any event,  on  the  Termination  Date  applicable  to the Term
             Facility B Loan.

                                       39

<PAGE>


(c)   In  the  event  that  the amount required to be covered by any Letter  of
      Credit  is  reduced  by  the   European  Commission,  the  Company  shall
      immediately notify the Facility Agent accordingly, whereupon:

      (i)    a new Letter of Credit shall  immediately be issued for the lesser
             amount  required  by  the  European   Commission  which  shall  be
             effective only upon the cancellation and  return  of  the original
             Letter of Credit to the Facility Agent; and

      (ii)   upon  such  cancellation  and  return  of  the original Letter  of
             Credit, each Issuing Bank's Letter of Credit  Proportion  shall be
             reduced pro rata.

(d)   To  the extent that on the occurrence of the event described in paragraph
      (b) above  the  Company  does  not  return  to  the  Facility  Agent  the
      respective  original  Letter  of  Credit,  the  Company will provide Cash
      Collateral  in  an  amount equal to the amount by which  such  Letter  of
      Credit may be reduced.

5.9   LETTER OF CREDIT FRONTING FEE

      Until such time as a  Letter  of  Credit  is  returned  to the respective
      Issuing  Bank  and replaced by a new Letter of Credit in accordance  with
      Clause 5.8 (Cancellation  and  replacement  of  Letter  of  Credit),  the
      Company shall pay the Fronting Fee to such Issuing Bank, whereas the Term
      Facility B Lenders will be entitled to the relevant remuneration pursuant
      to Clause 13.4 (Letter of Credit Commission).

5.10  UTILISATION OF THE SUBFACILITIES

(a)   Subfacilities  may comprise overdraft facilities, letters of credit, bank
      guarantees, short term loans, foreign exchange facilities or, if approved
      by the Facility Agent, any other facilities or financial accommodation as
      may be required  in  connection  with the business of the Group which the
      Company and the relevant Subfacility Bank may agree from time to time.

(b)   The rate of interest, fees and other  remuneration  in  respect  of  each
      Subfacility   and  all  other  terms  and  conditions  thereof  shall  be
      determined by agreement  between  the  Subfacility  Bank and the relevant
      Borrower as set out in the relevant Subfacility Documents,  and  shall be
      based  upon  the  normal market rates and terms from time to time of  the
      Subfacility Bank taking account its fronting function.

(c)   Each Borrower and each Subfacility Bank agree with and for the benefit of
      each Subfacility Bank  that  any  utilisations made under any Subfacility
      provided by such Subfacility Bank shall not exceed the Subfacility.

(d)   In case of any inconsistency between  any  term of a Subfacility Document
      and of this Agreement, the terms of this Agreement shall prevail.

(e)   Each Borrower and each Subfacility Bank shall,  promptly  upon request by
      the  Facility  Agent,  provide  the  Facility Agent with such information
      relating to the operation of each Subfacility  as  the Facility Agent may
      from time to time request. Each Borrower consents to all such information
      being released to the Facility Agent and each Lender.

                                       40

<PAGE>


6.    CHANGE OF CURRENCY

6.1   SELECTION OF CURRENCY

      A Borrower shall select the currency of a Revolving  Credit Facility Loan
      in a Utilisation Request.

6.2   UNAVAILABILITY OF DOLLARS

      If before the Specified Time on any Quotation Day:

      (a)    the Facility Agent has received notice from a Lender  that Dollars
             are not readily available to it in the amount required; or

      (b)    a  Lender  notifies  the  Facility Agent that compliance with  its
             obligation to participate in  a  Revolving Credit Facility Loan in
             Dollars would contravene a law or regulation applicable to it,

      the Facility Agent will give notice to the  Company to that effect by the
      Specified Time on that day. In this event, any  Lender  that gives notice
      pursuant  to  this  Clause 6.2  will  be required to participate  in  the
      Revolving Credit Facility Loan in Euros  (in  an  amount  equal  to  that
      Lender's  proportion of the Euro Amount of that Loan or, in respect of  a
      Rollover Loan,  an  amount  equal to that Lender's proportion of the Euro
      Amount of the maturing Revolving  Credit  Facility Loan that is due to be
      repaid)  and  its  participation  will  be treated  as  a  separate  Loan
      denominated in Euros during that Interest Period.

                                       41

<PAGE>


                                   SECTION 4

                    REPAYMENT, PREPAYMENT AND CANCELLATION

7.    REPAYMENT

7.1   REPAYMENT OF TERM FACILITY A LOAN

(a)   The Company shall repay the Term Facility A Loan by repaying on each Term
      Facility A Repayment Date an amount or amounts  such  that  the amount in
      Euros  of  the  outstanding Term Facility A Loan is reduced by an  amount
      equal to the amount  which appears opposite the Term Facility A Repayment
      Dates set out in the following table:

<TABLE>
<CAPTION>
      Term Facility A Repayment Date     Repayment Amount
      <S>                                 <C>
      30 June 2004                       [e]2,500,000
      31 December 2004                   [e]2,500,000
      30 June 2005                       [e]5,000,000
      31 December 2005                   [e]5,000,000
      30 June 2006                       [e]1,250,000
      31 December 2006                   [e]1,250,000
      30 June 2007                       [e]1,250,000
      31 December 2007                   [e]1,250,000
      30 June 2008                       [e]1,250,000
      30 December 2008                   [e]3,750,000
      TOTAL                              [e]25,000,000
</TABLE>

(b)   The Company may not re-borrow  any  part  of  Term  Facility  A  which is
repaid.

7.2   SATISFACTION OF LIABILITIES IN RELATION TO TERM FACILITY B

(a)   The Company shall ensure that no amount is outstanding on the Termination
      Date  applicable  to Term Facility B in relation to a Utilisation in  the
      form of the issuance  of  a  Letter  of  Credit and shall ensure that the
      Letters of Credit are returned to the Facility  Agent,  or  else  provide
      sufficient  Cash  Collateral  (including,  inter  alia, interest coverage
      payable  in arrears in respect of each six (6) Months  period  after  the
      Termination  Date applicable to Term Facility B) to the Facility Agent to
      cover  the  Company's   payment  obligations  thereunder  in  full.  Such
      obligation to provide Cash  Collateral  is continuing and, in particular,
      shall survive the termination of this Agreement.

                                       42

<PAGE>


(b)   The Company shall repay the Term Facility  B  Loan  by  repaying  on  the
      Termination  Date  applicable to the Term Facility B an amount or amounts
      such that the aggregate  amount  in  Euros  of  all  the outstanding Term
      Facility B Loans is repaid in full.

7.3   REPAYMENT OF TERM FACILITY C LOAN

(a)   The Company shall repay the Term Facility C Loan by repaying on each Term
      Facility  C Repayment Date an amount or amounts such that  the  aggregate
      amount in Euros  of all outstandings under the Term Facility C Loan drawn
      by the Company is  reduced by an amount equal to the amount which appears
      opposite the relevant  Term  Facility  C  Repayment  Date  set out in the
      following table:

<TABLE>
<CAPTION>
      Term Facility C Repayment Date     Repayment Amount
      <S>                                 <C>
      30 September 2004                  [e]2,333,335
      31 March 2005                      [e]2,333,333
      30 September 2005                  [e]2,333,333
      31 March 2006                      [e]2,333,333
      30 September 2006                  [e]2,333,333
      31 March 2007                      [e]2,333,333
      30 September 2007                  [e]6,000,000
      TOTAL                              [e]20,000,000
</TABLE>


(b)   The  Company  may  not  re-borrow  any  part of Term Facility C which  is
      repaid.

7.4   REPAYMENT OF REVOLVING CREDIT FACILITY LOANS

      Each Borrower shall repay each Revolving Credit Facility Loan that it has
      drawn on the last day of that Revolving Credit  Facility  Loan's Interest
      Period  and  no  Interest  Period  shall fall after the Termination  Date
      applicable to the Revolving Credit Facility.

8.    COMPANY'S LIABILITIES IN RELATION TO LETTER OF CREDIT

8.1   DEMANDS UNDER LETTER OF CREDIT

      If a demand is made under a Letter of  Credit,  as the case may be, or an
      Issuing  Bank  incurs  in connection with a Letter of  Credit  any  other
      liability, cost, claim,  loss  or  expense  which  is  to  be  reimbursed
      pursuant  to  this  Agreement,  the  relevant Issuing Bank shall promptly
      notify the Facility Agent of the amount of such demand or such liability,
      cost, claim, loss or expense and the Facility Agent shall promptly notify
      the Company.

                                       43

<PAGE>


8.2   THE COMPANY'S INDEMNITY TO ISSUING BANKS

      The Company shall irrevocably and unconditionally as a primary obligation
      indemnify (on demand of the Facility Agent)  any  Issuing  Bank which has
      issued a Letter of Credit at the request of the Company against:

      (a)    any  sum  paid,  or due and payable, by that Issuing Bank  to  the
             beneficiary of such  Letter  of Credit under or in connection with
             the relevant Letter of Credit; and

      (b)    all liabilities, costs (including,  without  limitation, any costs
             incurred in funding any amount which falls due  from  that Issuing
             Bank  under  the  relevant Letter of Credit or in connection  with
             it), claims, losses  and  expenses  which that Issuing Bank may at
             any time reasonably incur or sustain in connection with or arising
             out of the relevant Letter of Credit.

      The indemnity obligations pursuant to this Clause 8.2 shall in respect of
      any Original Issuing Bank which is not a party  to  this Agreement create
      direct claims of such Original Issuing Bank (Vertrag  zugunsten  Dritter)
      against the Company.

8.3   THE COMPANY'S INDEMNITY TO TERM FACILITY B LENDERS

      The Company shall irrevocably and unconditionally as a primary obligation
      indemnify  (on demand of the Facility Agent) a Term Facility B Lender  in
      respect of any Letter of Credit:

      (a)    any sum  paid,  or due and payable, by that Term Facility B Lender
             (whether  under  Clause 28.1  (Lenders'  Indemnity),  Clause  28.2
             (Direct Participation)  or  otherwise)  in  connection  with  such
             Letter of Credit; and

      (b)    all  liabilities,  costs (including, without limitation, any costs
             incurred in funding  any  amount  which  falls  due from that Term
             Facility  B  Lender  in  connection with such Letter  of  Credit),
             claims, losses and expenses  which that Term Facility B Lender may
             at any time reasonably incur or  sustain  in  connection with such
             Letter of Credit.

8.4   PRESERVATION OF RIGHTS

      Neither the obligations of the Company set out in this  Clause 8  nor any
      rights,  powers  and remedies conferred on any Term Facility B Lender  or
      Issuing Bank derived therefrom or by law shall be discharged, impaired or
      otherwise affected by:

      (a)    the winding-up,  dissolution, administration or re-organisation of
             the relevant upon  Term  Facility  B  Lender,  Issuing Bank or any
             other  person  or any change in the status, function,  control  or
             ownership of any of them;

      (b)    any of the obligations  of  the  relevant  Term Facility B Lender,
             Issuing  Bank  or  any  other  person  under  any of  the  Finance
             Documents, under any Letter of Credit or under  any other security
             taken  in respect of the Company's obligations under  any  of  the
             Finance  Documents, or otherwise in connection with such Letter of
             Credit, being  or  becoming  illegal,  invalid,  unenforceable  or
             ineffective in any respect;

      (c)    time  or other indulgence being granted or agreed to be granted to
             the relevant  Term  Facility  B  Lender, Issuing Bank or any other
             person in respect of the obligations  of  any of them under any of
             the Finance Documents, under or in connection  with  any

                                       44

<PAGE>


             Letter of Credit  or  under any  other  security  taken in respect
             of  the  Company's  obligations   under   any   of   the   Finance
             Documents, or otherwise in connection with such Letter of Credit;

      (d)    any  amendment to, or any variation, waiver  or  release  of,  any
             obligation of the relevant Term Facility B Lender, Issuing Bank or
             any other  person  under  any Letter of Credit or under any of the
             Finance Documents; or

      (e)    any other act, event or omission  which,  but  for  this Clause 8,
             might operate to discharge, impair or otherwise affect  any of the
             obligations of the Company set out in this Clause 8 or any  of the
             rights, powers or remedies conferred upon any Issuing Bank by this
             Agreement or by law.

      The  obligations  of  the  Company  set  out in this Clause 8 shall be in
      addition  to  and  independent of every other  security  which  any  Term
      Facility B Lender or  Issuing Bank may at any time hold in respect of the
      Company's obligations under  this  Agreement  or  otherwise in connection
      with such Letter of Credit.

8.5   SETTLEMENT CONDITIONAL

      Any settlement or discharge between the Company and  a  Term  Facility  B
      Lender  or  Issuing Bank shall be conditional upon no security or payment
      to that Term  Facility  B  Lender  or Issuing Bank by the Company, or any
      other person on behalf of the Company, being avoided or reduced by virtue
      of any laws relating to bankruptcy,  insolvency,  liquidation  or similar
      laws  of general application and, if any such security or payment  is  so
      avoided  or reduced, that Term Facility B Lender or Issuing Bank shall be
      entitled to  recover the value or amount of such security or payment from
      the Company subsequently  as  if  such  settlement  or  discharge had not
      occurred.

8.6   RIGHT TO MAKE PAYMENTS UNDER LETTERS OF CREDIT

      Each  Issuing  Bank  shall be entitled to make any payment in  accordance
      with the terms of any  Letter  of  Credit  without  any  reference to, or
      further  authority  from,  the  Company  or  any  other investigation  or
      enquiry. The Company irrevocably authorises each Issuing  Bank  to comply
      with any demand under such Letter of Credit which is valid on its face.

8.7   CONVERSION OF TERM FACILITY B UPON DEMAND UNDER LETTER OF CREDIT

      If a demand is made under a Letter of Credit or, as the case may  be,  an
      Issuing  Bank  or  a  Term  Facility B Lender incurs any liability, cost,
      claim, loss or expense in connection  with a Letter of Credit, and to the
      extent that the Company is obligated to  indemnify  the  relevant Issuing
      Bank  or  Term  Facility  B Lender pursuant to Clause 8.2 (The  Company's
      Indemnity to Issuing Banks)  or  Clause  8.3  (The Company's Indemnity to
      Term Facility B Lenders), the Issuing Bank or Term Facility B Lenders, as
      the case may be, shall be deemed to have made a loan to the Company under
      Term Facility B in the amount of such indemnity  (the  "TERM  FACILITY  B
      LOAN"),  In  case  of  any subsequent demand under a Letter of Credit the
      amount of the Term Facility  B Loan shall be increased in accordance with
      such further amount becoming due  and  payable by the Company pursuant to
      Clause 8.2 (The Company's Indemnity to Issuing  Banks) or Clause 8.3 (The
      Company's Indemnity to Term Facility B Lenders).  The  amount of any Cash
      Collateral provided by the Company in accordance with the  terms  of this
      Agreement  shall  be applied towards the indemnity amount referred to  in
      the preceding two sentences of this Clause 8.7 and the amount of the Term
      Facility B Loan shall be reduced accordingly.

                                       45

<PAGE>


9.    PREPAYMENT AND CANCELLATION

9.1   ILLEGALITY

      If it becomes unlawful  in  any jurisdiction for a Lender or Issuing Bank
      to perform any of its obligations as contemplated by this Agreement or to
      fund, issue, participate in or  allow  to  remain outstanding any Loan or
      Letter of Credit:

      (a)    that  Lender or Issuing Bank shall promptly  notify  the  Facility
             Agent upon becoming aware of that event;

      (b)    upon the  Facility  Agent notifying the Company, any Commitment of
             that Lender will be immediately  cancelled or, as the case may be,
             any obligation of that Issuing Bank  to  issue  Letters  of Credit
             will immediately cease; and

      (c)    each  Borrower  shall, on the last day of the Interest Period  for
             each Loan or Term  for  any  Letter  of Credit occurring after the
             Facility Agent has notified the Company  or,  if earlier, the date
             specified by the Lender or Issuing Bank in the notice delivered to
             the  Facility  Agent (being no earlier than the last  day  of  any
             applicable grace period permitted by law):

             (i)   repay that  Lender's participation in the Loans made to that
                   Borrower together with accrued interest thereon, Break Costs
                   and all other amounts owing to such Lender under the Finance
                   Documents;

             (ii)  (if the circumstance  relates  to  an  Issuing Bank) procure
                   either that such Issuing Bank's Letter of  Credit Proportion
                   of the Letter of Credit be reduced to zero (by  reduction of
                   the  amount  of  the Letter of Credit in an amount equal  to
                   that Issuing Bank's  Letter  of  Credit  Proportion) or that
                   Cash Collateral be provided in an amount in  Euros  equal to
                   such  Issuing  Bank's  Letter  of  Credit  Proportion of the
                   Letter of Credit.

9.2   MANDATORY PREPAYMENT FROM DEBT ISSUE OR EQUITY ISSUE

      The  Company shall ensure that an amount equal to one hundred  (100)  per
      cent. of the Net Proceeds arising from a Debt Issue (other than the issue
      of the  High  Yield  Notes)  and an amount equal to seventy-five (75) per
      cent. of the Net Proceeds arising  from  an  Equity Issue (other than the
      Rights  Issue)  (such  Equity Issue only to be made  in  accordance  with
      applicable laws) by any  Group  Member  are  paid  to  the Facility Agent
      promptly upon the receipt of such Net Proceeds by such Group  Member  and
      applied  in prepayment of the outstandings under the Senior Facilities in
      accordance with Clause 9.7 (Application of Prepayments).

9.3   MANDATORY PREPAYMENT FROM ASSET DISPOSALS

(a)   Subject to paragraph (b) and (c) below, the Company shall ensure that the
      Net Proceeds arising from each disposal of assets by any Group Member are
      paid to the Facility Agent promptly upon the receipt of such Net Proceeds
      by such Group  Member and applied in prepayment of the outstandings under
      the Senior Facilities  in  accordance  with  Clause  9.7  (Application of
      Prepayments).

(b)   Paragraph (a) shall not apply to Net Proceeds arising from any disposal:

                                       46

<PAGE>


      (i)    to  the extent that the Company or the relevant Group  Member  can
             demonstrate  to  the  satisfaction of the Facility Agent that such
             disposal was on arm's length  terms  and that the Net Proceeds are
             to be re-invested in similar or like assets  of  a  comparable  or
             superior  quality,  type or value within a period of 180 days from
             the date of receipt of such Net Proceeds by such Group Member;

      (ii)   if such disposal falls  within  paragraphs (a) (subject to a limit
             of [e]500,000 per disposal), (b), (c)  or (e) of the definition of
             "PERMITTED DISPOSAL" in Clause 1.1 (Definitions);

      (iii)  if  such  disposal  relates  to  a  sale  of  electrical  contacts
             (graphite specialties) by Gelter Ringsdorff S.A.;

      (iv)   if the Net Proceeds per  disposal do not exceed  [e]1,000,000  (or
             its equivalent in another  currency) or, when  aggregated with the
             Net Proceeds received by any Group Member from any other disposals
             of assets made in the immediately  preceding  twelve (12) calendar
             month period  (excluding the Net Proceeds from  disposals  falling
             within  sub-paragraphs  (i); (ii) or (iii)  above),  do not exceed
             [e]7,500,000 (or its equivalent in another currency).

(c)   The  Company  shall  ensure  that  any  Net Proceeds  to  be  applied  in
      accordance  with paragraph (b)(i) above are  promptly  deposited  in  the
      Prepayment Account  upon  receipt  by  the  relevant  Group  Member.  The
      relevant  Group  Member that received the Net Proceeds shall be entitled,
      during the period  of  180  days  from  the  date  of receipt of such Net
      Proceeds, to withdraw such Net Proceeds from the Prepayment  Account only
      to the extent that it is able to demonstrate to the satisfaction  of  the
      Facility  Agent that such Net Proceeds will be immediately re-invested in
      accordance  with  paragraph  (b)(i) above. Any amounts not so re-invested
      during such 180 day period shall thereafter be paid to the Facility Agent
      and applied in prepayment of the outstandings under the Senior Facilities
      in accordance with Clause 9.7 (Application of Prepayments).

9.4   MANDATORY PREPAYMENT FROM INSURANCE PROCEEDS

(a)   Subject to paragraphs (b), (c),  and  (d) below, the Company shall ensure
      that any Insurance Proceeds received by  any Group Member are paid to the
      Facility Agent promptly upon the receipt of  such  Insurance  Proceeds by
      such Group Member and applied in prepayment of the outstandings under the
      Senior   Facilities   in  accordance  with  Clause  9.7  (Application  of
      Prepayments).

(b)   Paragraph (a) shall not  apply  to  any  Insurance  Proceeds  unless  the
      Insurance  Proceeds  exceed  [e]1,000,000  (or  its equivalent in another
      currency)  or,  when  aggregated with the Insurance Proceeds received  by
      Group Members from claims  made  in the immediately preceding twelve (12)
      calendar month period (excluding the  Insurance  Proceeds  from disposals
      falling   within  paragraphs  (c)  below), exceed  [e]7,500,000  (or  its
      equivalent in another currency).

(c)   Paragraph (a)  shall  not  apply  to any Insurance Proceeds to the extent
      that:

      (i)    such Insurance Proceeds are  promptly upon receipt by the relevant
             Group Member deposited in the  Prepayment  Account  in  accordance
             with paragraph (d) below; and

      (ii)   such  Insurance Proceeds are applied, to the satisfaction  of  the
             Facility  Agent,  towards  the  replacement,  reinstatement and/or
             repair   of  the  assets  and/or  the

                                       47

<PAGE>


             satisfaction of business  interruption  losses in respect of which
             the  relevant  insurance  claim  was  made  (or to  refinance  any
             expenditure  incurred  in the  replacement,  reinstatement  and/or
             repair  of  such  assets  and/or  the   satisfaction  of  business
             interruption  losses) within a period of 180 days from the date of
             receipt of such Insurance Proceeds by the relevant Group Member.

(d)   The Company shall ensure that any Insurance  Proceeds  to  be  applied in
      accordance  with  paragraph  (c)  above  are  promptly  deposited  in the
      Prepayment  Account,  upon  receipt  by  the  relevant  Group Member. The
      relevant  Group  Member  that  received the Insurance Proceeds  shall  be
      entitled, during the period of 180  days  from the date of its receipt of
      such  Insurance Proceeds, to withdraw such Insurance  Proceeds  from  the
      Prepayment  Account  only to the extent that it is able to demonstrate to
      the satisfaction of the  Facility Agent that such Insurance Proceeds will
      be immediately applied in  accordance  with paragraph (c) above. Any sums
      not so withdrawn during the 180 day period  shall  thereafter  be paid to
      the  Facility  Agent and applied in prepayment of the outstandings  under
      the Senior Facilities  in  accordance  with  Clause  9.7  (Application of
      Prepayments).

9.5   MANDATORY PREPAYMENT FROM EXCESS CASH FLOW

      The Company shall ensure that, within thirty (30) days of delivery to the
      Facility   Agent  of  the  most  recent  audited  consolidated  financial
      statements of the Company pursuant to Clause 21.1(a), commencing with the
      audited  consolidated   financial  statements  of  the  Company  for  the
      financial year ending 31 December 2003, an amount equal to fifty (50) per
      cent. of the amount of the Excess Cash Flow exceeding a minimum amount of
      [e]7,500,000 for the financial year to  which  such  financial statements
      relate shall be paid to the Facility Agent and applied  in  prepayment of
      the  outstandings  under the Senior Facilities in accordance with  Clause
      9.7 (Application of Prepayments).

9.6   MANDATORY PREPAYMENT IN RESPECT TO DIVIDEND PAYMENTS OR DISTRIBUTIONS

      If the Company makes  any  dividend,  return  of  capital,  repayment  of
      capital  contributions or other distribution (whether in cash or kind) or
      makes any  distribution  of assets or other payment whatsoever in respect
      of share capital whether directly or indirectly, the Company shall ensure
      that within thirty (30) days of the same, an amount equal to such payment
      or distribution shall be paid  to  the  Facility  Agent  and  applied  in
      prepayment  of the outstandings under the Senior Facilities in accordance
      with Clause 9.7 (Application of Prepayments).

9.7   APPLICATION OF PREPAYMENTS

(a)   Any amounts paid  to  the  Facility  Agent  in accordance with Clause 9.2
      (Mandatory  Prepayment from Debt Issue or Equity  Issue)  to  Clause  9.6
      (Mandatory Prepayment  in  respect to Dividend Payments or Distributions)
      (inclusive) shall be applied:

      (i)    first, in prepayment  on  a pro rata basis of all outstanding Term
             Facility Loans and the US Term Loans;

      (ii)   secondly, Cash Collateral to  be  provided  in  an amount equal to
             each Issuing Bank's Letters of Credit Proportion or Issuing Bank's
             liability under the Letter of Credit in Euros, as relevant;

                                       48

<PAGE>


      (iii)  thirdly,  in  permanent  prepayment  on  a pro rata basis  of  all
             outstanding Revolving Credit Facility Loans  (in such order as the
             Company may select or, in the absence of such  selection,  as  the
             Facility Agent shall determine); and

      (iv)   fourthly,  if any excess remains, in payment of such excess to the
             relevant Group Member,

      provided that to the extent that the US Term Lenders exercise their right
      to refuse prepayment  under  the  US  Term Loan Agreement , the amount so
      refused shall be applied pro rata to the  outstanding Term Facility Loans
      and  thereafter  be  applied  for the provision  of  Cash  Collateral  in
      accordance with paragraph (a) (ii) of this Clause 9.7.

(b)   Notwithstanding Clause 9.7 (a),  any  prepayment  in  respect of accounts
      receivables made in accordance with Clause 9.3 (Mandatory Prepayment from
      Asset Disposals) shall be applied in cancellation and prepayment  of  the
      outstanding Revolving Credit Facility.

(c)   Any prepayment of the Term Facility A Loan, Term Facility B Loans or Term
      Facility  C  Loans  in  accordance with this Clause 9.7 shall reduce (and
      there shall be a corresponding cancellation in) the Available Facility in
      respect of each such Term  Facility.  Any  such cancellation shall reduce
      the  Commitments of the Lenders rateably under  such  Term  Facility.  No
      amount so cancelled may be reborrowed.

(d)   Any prepayment  of the Revolving Credit Facility Loans in accordance with
      this  Clause  9.7 shall  reduce  (and  there  shall  be  a  corresponding
      cancellation in)  the  Available  Facility  in  respect  of the Revolving
      Credit  Facility.  Any such cancellation shall reduce the Commitments  of
      the Lenders rateably  under  that Facility. No amount so cancelled may be
      reborrowed.

(e)   Any amounts to be applied in prepayment of the US Term Loan in accordance
      with this Clause 9.7 (Application of Prepayments) shall be converted into
      Euros at the Facility Agent's  Spot  Rate of Exchange three Business Days
      prior to the date the relevant Prepayment is made.

9.8   DATE FOR PREPAYMENT

(a)   If Clause 9.2 (Mandatory Prepayment from  Debt  Issue or Equity Issue) to
      Clause 9.5 (Mandatory Prepayment from Excess Cash Flow) (inclusive) would
      require the prepayment of a Loan otherwise than on  the  last  day  of an
      Interest Period relating to that Loan, the Company may, by written notice
      to  the  Facility  Agent (to be received not less than three (3) Business
      Days prior to the date  on  which such prepayment would be required to be
      made  (but  for  this Clause 9.8)),  request  that  the  amount  of  such
      prepayment be placed  in  an identified Prepayment Account in which event
      such amount shall be paid to  the  credit  of such Prepayment Account and
      shall,  together with any interest accrued thereon,  be  applied  by  the
      Facility  Agent in prepayment of the relevant Loan on the last day of the
      then current Interest Period relating to that Loan.

(b)   So long as  any  Loan  remains  outstanding or any of the Commitments are
      available for drawing, no amount  shall be withdrawn from such Prepayment
      Account  except  for  immediate  application  in  making  any  prepayment
      pursuant to Clause 9.2 (Mandatory  Prepayment  from  Debt Issue or Equity
      Issue)  to  Clause  9.5  (Mandatory  Prepayment  from Excess  Cash  Flow)
      (inclusive) or as provided in paragraph (c) below.

                                       49

<PAGE>


(c)   The Facility Agent shall be entitled (but not obliged) to apply the whole
      or any part of the sums standing to the credit of such Prepayment Account
      in or towards payment of any unpaid sums at any time due from any Obligor
      under this Agreement.

9.9   VOLUNTARY PREPAYMENT

(a)   The Company may, if it gives the Facility Agent not  less  than  five (5)
      Business Days' (or such shorter period as the Majority Lenders may agree)
      prior notice, prepay the whole or any part of any Term Facility A Loan or
      Term  Facility B Loan (but, if in part, being an amount that reduces  the
      amount of the relevant Term Facility Loan by a minimum amount of
      [e]500,000 and represents an integral multiple of [e]250,000).

(b)   A Term  Facility A Loan or Term Facility B Loan may only be prepaid after
      the last  day  of the Availability Period applicable to its Facility (or,
      if earlier, the  first  day on which the Available Facility applicable to
      its Facility is zero).

(c)   Any prepayment under this Clause 9.9 shall be applied on a pro rata basis
      against all outstanding Term  Facility  Loans  and  the  US Term Loans as
      determined  by  the  Company  with not less than five (5) Business  Days'
      prior notice to the Facility Agent.

(d)   The Company may, if it gives the  Facility  Agent  not less than five (5)
      Business Days' (or such shorter period as the Lender of the Term Facility
      C Loan may agree) prior notice, prepay the whole or  any part of the Term
      Facility C Loan (but, if in part, being an amount that reduces the amount
      of the Term Facility C Loan by a minimum amount of [e]5,000,000).

(e)   Any amounts to be applied in prepayment of the US Term Loan in accordance
      with this Clause 9.9 (Voluntary Prepayment) shall be converted into Euros
      at  the Facility Agent's Spot Rate of Exchange on the date  the  relevant
      Prepayment is made.

9.10  CASH COLLATERALISATION OF LETTER OF CREDIT

      The Company  may  provide  Cash  Collateral in Euros to reduce an Issuing
      Bank's Letter of Credit Proportion  or  a  Issuing Bank's liability under
      any Letter of Credit at any time, PROVIDED THAT  to  the extent that such
      Letter  of  Credit  is  issued by more than one Issuing Bank,  such  Cash
      Collateral shall be applied  towards  the  pro  rata  reduction  of  each
      Issuing Bank's Letter of Credit Proportion.

9.11  VOLUNTARY CANCELLATION

(a)   The  Company  may,  if it gives the Facility Agent not less than five (5)
      Business Days' (or such shorter period as the Majority Lenders may agree)
      prior notice, cancel  the  whole  or  any part (being a minimum amount of
      [e]500,000  and  representing  an integral multiple of [e]250,000) of the
      Available Facility for the Revolving  Credit  Facility.  Any cancellation
      under  this  Clause 9.11  shall  reduce  the  Commitments of the  Lenders
      rateably under the Revolving Credit Facility.

(b)   The Company may give the Facility Agent not less  than  five (5) Business
      Days'  (or such shorter period as the Majority Lenders may  agree)  prior
      notice of  its  intention  to  procure  that  the relevant Issuing Bank's
      liability under any Letter of Credit is reduced  to  zero  (whereupon the
      Company shall do so).

                                       50

<PAGE>




9.12  RIGHT  OF  REPAYMENT AND CANCELLATION IN RELATION TO A SINGLE  LENDER  OR
      ISSUING BANK

(a)   If:

      (i)    any sum  payable  to  any  Lender or Issuing Bank by an Obligor is
             required to be increased under Clause 14.2(c); or

      (ii)   any Lender or Issuing Bank claims indemnification from the Company
             (or that the Company procures  that the liabilities of each of the
             Issuing Banks under or in connection  with  the  Letters of Credit
             are promptly reduced to zero) under Clause 14.3 (Tax Indemnity) or
             Clause 15.1 (Increased Costs); or

      (iii)  any Lender notifies the Facility Agent of its Additional Cost Rate
             under paragraph 3 of Schedule 4 (Mandatory Cost Formula),

      the  Company may, whilst (in the case of paragraphs (i) and  (ii)  above)
      the circumstance  giving  rise  to  the  requirement  or  indemnification
      continues or (in the case of paragraph (iii) above) that Additional  Cost
      Rate  is  greater  than  zero,  give the Facility Agent at least ten (10)
      Business Days' prior written notice:

      (A)    of  cancellation  of  the  Commitments  of  that  Lender  and  its
             intention to procure the repayment  of that Lender's participation
             in the Loans; or

      (B)    (if such circumstance relates to an Issuing Bank) the reduction to
             zero of that Issuing Bank's liability  in respect of the Letter of
             Credit  or the provision of Cash Collateral  in  respect  of  that
             Issuing Bank's Letter of Credit Proportion.

(b)   On receipt of a notice referred to in paragraph (a) above, any Commitment
      of that Lender shall immediately be reduced to zero.

(c)   On the last day  of  each  Interest  Period  or, as the case may be, Term
      which ends after the Company has given notice  under  paragraph (a) above
      (or, if earlier, the date specified by the Company in that  notice), each
      Borrower  to  which a Loan is outstanding and the Company in relation  to
      any Letter of Credit shall:

      (i)    repay that Lender's participation in that Loan; and

      (ii)   procure   either   that  such  Issuing  Bank's  Letter  of  Credit
             Proportion  of such Letter  of  Credit  be  reduced  to  zero  (by
             reduction of the amount of the Letter of Credit in an amount equal
             to that Issuing  Bank's  Letter of Credit Proportion) or that Cash
             Collateral be provided in  an  amount equal to such Issuing Bank's
             Letter of Credit Proportion of the Letter of Credit in Euros).

9.13  RESTRICTIONS

(a)   Any notice of cancellation or prepayment  given  by  any Party under this
      Clause 9  shall be irrevocable and, unless a contrary indication  appears
      in this Agreement,  shall  specify  the  date  or  dates  upon  which the
      relevant cancellation or prepayment is to be made and the amount  of that
      cancellation or prepayment.

(b)   Any  prepayment  under this Agreement shall be made together with accrued
      interest on the amount  prepaid  and, subject to any Break Costs, without
      premium or penalty.

(c)   No Borrower may reborrow any part of a Term Facility that is prepaid.

                                       51

<PAGE>


(d)   Unless a contrary indication appears  in  this Agreement, any part of the
      Revolving Credit Facility that is prepaid (other  than pursuant to Clause
      9.7 (Application of Prepayments)) may be reborrowed  in  accordance  with
      the terms of this Agreement.

(e)   The  Borrowers  shall  not  repay or prepay all or any part of the Loans,
      reduce the liabilities of the Issuing Banks or provide Cash Collateral in
      respect of any Letter of Credit,  and the Company shall not cancel all or
      any part of the Commitments, except  at  the  times  and  in  the  manner
      expressly provided for in this Agreement.

(f)   No amount of the Total Commitments cancelled under this Agreement may  be
      subsequently reinstated.

(g)   If  the  Facility  Agent  receives  a notice under this Clause 9 it shall
      promptly forward a copy of that notice  to  either  the  Company  or  the
      affected Lender, as appropriate.

(h)   Any  reduction  or cancellation of the Term Facility A Commitment, a Term
      Facility B Commitment, the Term Facility C Commitment or, as the case may
      be, a Revolving Credit  Facility  Commitment  under  this  Clause 9 shall
      reduce the Total Term Facility A Commitments, the Total Term  Facility  B
      Commitments, the Total Term Facility C Commitment or, as the case may be,
      Total  Revolving  Credit  Facility  Commitments  by  the  amount  of such
      reduction or cancellation.



                                   SECTION 5

                             COSTS OF UTILISATION

10.   INTEREST

10.1  CALCULATION OF INTEREST IN RESPECT OF TERM FACILITY A LOAN, TERM FACILITY
      B LOANS AND REVOLVING CREDIT FACILITY LOANS

      The  rate  of interest on the Term Facility A Loan, each Term Facility  B
      Loan and each  Revolving Credit Facility Loan for each Interest Period is
      the percentage rate per annum which is the aggregate of the applicable:

      (a)    Margin;

      (b)    EURIBOR or, in relation to any Loan in Dollars, LIBOR; and

      (c)    Mandatory Cost, if any.

10.2  MARGIN RATCHETS

(a)   Save as provided  in  paragraph  (b)  below, the Margin, in relation to a
      Term  Facility  A  Loan,  Term Facility B Loan  and  a  Revolving  Credit
      Facility Loan, respectively,  shall  be  the  percentage  rate  per annum
      specified   in   the   definition  of  "INITIAL  MARGIN"  in  Clause  1.1
      (Definitions).

(b)   Save as provided in Clause  10.4  (Margin  in  Default) and in accordance
      with  Clause 10.3 (Margin Changes), if the financial  statements  of  the
      Group in  respect  of  the  Financial  Quarter ended 31 March 2005 or any
      Financial Quarter thereafter, and the Compliance  Certificate relating to
      such financial statements, delivered to the Facility  Agent  pursuant  to

                                       52

<PAGE>

      Clause   21.1   (Financial   Statements)   and  Clause  21.2  (Compliance
      Certificate) respectively, disclose that the Leverage Ratio as at and for
      the period of twelve (12) Months ending on the last day of that Financial
      Quarter falls within a range of the ratios specified  in  Column A below,
      then  the  Margin,  in  respect  of  the  Term Facility A Loan, all  Term
      Facility B Loans and all Revolving Credit Facility  Loans,  shall  be the
      adjusted percentage rate per annum set out opposite such ratios in Column
      B below:


<TABLE>
<CAPTION>
                     COLUMN A                                COLUMN B
                 (LEVERAGE RATIO)                 (MARGIN (PER CENT. PER ANNUM))
<S>                                                      <C>
Greater than 4.0:1                                      2.75 per cent. per annum
Equal to or less than 4.0:1 but greater than 3.25:1     2.25 per cent. per annum
Equal to or less than 3.25:1 but greater than 2.5:1     1.75 per cent. per annum
Equal to or less than 2.5:1                             1.25 per cent. per annum
</TABLE>

10.3  MARGIN CHANGES

(a)   Save as provided in this Clause 10.3 and Clause 10.4 (Margin in Default),
      any  change  in  the Margin provided for by Clause 10.2 (Margin Ratchets)
      shall take effect, in relation to all existing and future Term Facility A
      Loans,  Term Facility  B  Loans  and  Revolving  Credit  Facility  Loans,
      respectively,  five  Business Days after receipt by the Facility Agent of
      the relevant consolidated  financial  statements  of  the  Group  and the
      Compliance  Certificate  pursuant to Clause 21.2 (Compliance Certificate)
      for the relevant Financial Quarter.

(b)   If in any financial year of the Group:

      (i)    the Margin has been  adjusted  pursuant  to  this  Clause  10.3 in
             reliance  on  a  Compliance  Certificate  relating to consolidated
             financial  statements of the Group delivered  pursuant  to  Clause
             21.1 (Financial Statements) in respect of any Financial Quarter in
             that financial year; and

      (ii)   the  audited   consolidated  financial  statements  of  the  Group
             delivered  pursuant  to  Clause  21.1  (Financial  Statements)  in
             respect of that financial year show that such reduction should not
             have been made,

      that reduction shall  be  reversed  with retrospective effect, the Margin
      applicable  to  the relevant Facility shall  be  that  justified  by  the
      audited consolidated financial statements, amounts of interest calculated
      by reference to the  adjusted  Margin (whether or not already paid) shall
      be recalculated by reference to  the  Margin  justified by such financial
      statements and the Borrowers shall be required  to  make a payment to the
      Facility  Agent, in such amounts as the Facility Agent  may  specify,  to
      cover any shortfall  in  amounts  of  interest  which  should  have  been
      received by the Lenders following any recalculation. The Facility Agent's
      determination  of  any such shortfall shall, save in the case of manifest
      error, be

                                       53

<PAGE>


      conclusive  and  the  Facility  Agent  shall  provide  the  Company  with
      reasonable details of the calculation of such shortfall.

10.4  MARGIN IN DEFAULT

(a)   The Margin shall immediately convert to the  Default Margin from the date
      determined by the Facility Agent as being the date on which a Default has
      occurred or come into existence (until the date specified by the Facility
      Agent  as  being  the  date  on  which  it has been demonstrated  to  its
      reasonable satisfaction that such Default  is no longer continuing or has
      been  waived  or in the case of a breach of a  financial  covenant  under
      Clause 22 (Financial  Covenants),  the  date  on which the Facility Agent
      receives a Compliance Certificate confirming that  such  breach  has been
      remedied  (and  the  Margin  shall thereafter be determined in accordance
      with  Clause  10.2  (Margin Ratchets)  on  the  basis  of  the  unaudited
      consolidated management accounts of the Group in respect of the preceding
      four Financial Quarters  last delivered to the Facility Agent pursuant to
      Clause  21.1  (Financial  Statements),   together   with  the  Compliance
      Certificate relating to such financial statements delivered  pursuant  to
      Clause   21.2  (Compliance  Certificates).  If  the  Facility  Agent  has
      reasonable  doubts  (berechtigte  Zweifel)  that  such  breach  has  been
      remedied,  the  Facility Agent (acting on behalf of the Majority Lenders)
      may request that the management accounts are to be reviewed by auditors.

(b)   The Facility Agent  shall  promptly notify the Lenders and the Company of
      any determination that a Default  has  occurred or exists or, as the case
      may be, that it has been demonstrated to its reasonable satisfaction that
      such Default is no longer continuing.

10.5  PAYMENT OF INTEREST

      The Borrower to which a Term Facility A Loan, Term Facility B Loan or, as
      the case may be, a Revolving Credit Facility Loan has been made shall pay
      accrued interest on that Loan on the last  day  of  each  Interest Period
      (and, if the Interest Period is longer than six (6) Months,  on the dates
      falling  at  six-monthly  intervals  after  the first day of the Interest
      Period).

10.6  CALCULATION AND PAYMENT OF INTEREST IN RESPECT  OF  THE  TERM  FACILITY C
      LOAN

      The  rate  of interest on the Term Facility C Loan is 7.36 per cent.  per
      annum calculated  on  the basis of 30 days per month and otherwise of the
      actual number of days elapsed and a 360 days' year. The Company shall pay
      accrued interest on the Term Facility C Loan on each 31 March and each 30
      September of each calendar  year.  However,  in  respect  of the interest
      payment  due in relation to the period ending 31 March 2004,  the  Lender
      under Term Facility C will notify the amount of interest due on such date
      to the Facility  Agent  in writing in advance and the Facility Agent will
      collect such amount from the Company for distribution to such Lender.

10.7  DEFAULT INTEREST AND PENALTY

(a)   An Obligor shall be in default  (Verzug)  if  it  fails to pay any amount
      (other than in payment of interest and fees, other  than commitment fees)
      payable by it under a Finance Document on its due date. On the occurrence
      of such a default (Verzug), interest shall accrue on  the  overdue amount
      from the due date up to the date of actual payment (both before and after
      judgment) at a rate per annum determined by the Facility Agent  from time
      to time to be the aggregate of (i) EURIBOR or, in relation to any Loan in
      Dollars, LIBOR, (ii) the Default Margin, and (iii) the Mandatory Cost for
      such  period  as  the  Facility  Agent  may  select  on  the

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      Business  Day   immediately   following  such  date,   such  rate  to  be
      recalculated  on the same basis at the end of each such period until such
      sum is received by the Facility Agent.  Any interest  accruing under this
      Clause 10.7 shall be immediately  payable by the Obligor on demand by the
      Facility Agent.

(b)   If an Obligor fails to pay any amounts  in  payment  of  interest or fees
      under  a  Finance  Document  on  its  due  date,  such Obligor shall  pay
      liquidated damages to the Facility Agent for the account  of the relevant
      Lenders  in  an  amount  determined  by  the Facility Agent as being,  in
      respect of the period from the due date of  payment  until receipt by the
      Facility Agent of the relevant amount, the equivalent  of  interest  at a
      rate determined in accordance with Clause 10.7(a) applied to the relevant
      overdue amount.

(c)   In  the  circumstances  described  in  sub-Clauses (a) and (b) above, the
      Company  shall  be  entitled  to demonstrate  that  the  damage  actually
      suffered  by  the  Lenders  is  lower  than  the  amounts  determined  in
      accordance therewith, and the Lenders  shall  be  entitled  to  prove and
      claim for any higher damage.

10.8  NOTIFICATION OF RATES OF INTEREST

      The  Facility  Agent  shall  promptly notify the Lenders and the relevant
      Borrower of the determination of a rate of interest under this Agreement.

11.   INTEREST PERIODS AND THE TERM

11.1  SELECTION OF INTEREST PERIODS

(a)   A Borrower may select an Interest  Period  for  a Loan in the Utilisation
      Request for that Loan or (if the Loan has already  been  borrowed)  in  a
      Selection Notice.

(b)   Each Selection Notice for a Term Facility Loan is irrevocable and must be
      delivered  to  the  Facility  Agent  by  the  Borrower to which that Term
      Facility Loan was made not later than the Specified Time.

(c)   If a Borrower fails to deliver a Selection Notice  to  the Facility Agent
      in  accordance  with  paragraph  (b) above, the relevant Interest  Period
      will, subject to Clause 11.2 (Changes  to Interest Periods), be three (3)
      Months.

(d)   Subject to this Clause 11, a Borrower may  select  an  Interest Period of
      one  (1),  two  (2),  three  (3) or six (6) Month(s) or any other  period
      agreed between the relevant Borrower  and  the  Facility Agent (acting on
      the instructions of all the Lenders); however, in relation to a Revolving
      Credit Facility Loan, there may not be more than  twelve  (12)  one Month
      Interest Periods in any one year.

(e)   Subject to Clause 11.3 (Non-Business Days), an Interest Period for a Term
      Facility Loan shall not extend beyond the Termination Date applicable  to
      its  Facility.  An  Interest  Period for a Revolving Credit Facility Loan
      shall not extend beyond the Termination  Date applicable to the Revolving
      Credit Facility. A Term for a Letter of Credit  or a Bank Guarantee shall
      not extend beyond the Termination Date applicable to the Revolving Credit
      Facility.

(f)   Each  Interest  Period  for  a  Term  Facility Loan shall  start  on  the
      Utilisation Date or (if already made) on  the  last  day of its preceding
      Interest Period.

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(g)   A  Revolving  Credit  Facility Loan has one Interest Period  only,  which
      shall start on the respective Utilisation Date.

(h)   The Term for each Letter of Credit shall start on the Utilisation Date.

11.2  CHANGES TO INTEREST PERIODS

(a)   Prior to determining the interest rate for a Term Facility A Loan or Term
      Facility B Loan, the Facility  Agent  may, but is not obliged to, shorten
      an Interest Period for any Term Facility  A  Loan or Term Facility B Loan
      to ensure that the Loans drawn by any Borrower  in  respect  of that Term
      Facility A or Term Facility B and having an Interest Period ending  on  a
      Term  Facility  A  Repayment  Date  and  Term  Facility B Repayment Date,
      respectively, have an aggregate amount in Euros  equal to or greater than
      the relevant Repayment Instalment applicable to that  Borrower  and  that
      Loan on that date.

(b)   Prior  to  determining  the interest rate for a Revolving Credit Facility
      Loan, the Facility Agent  may, but is not obliged to, shorten an Interest
      Period for any Revolving Credit  Facility  Loan,  so  that  it  ends on a
      Revolving Credit Facility Cancellation Date (or, if any such date  is not
      a  Business  Day, on the preceding Business Day), in order to ensure that
      the aggregate Euro Amount of the Revolving Credit Facility Loans will not
      exceed the Total  Revolving Credit Facility Commitments immediately after
      any Revolving Credit Facility Cancellation Date.

(c)   If the Facility Agent  makes  any  of  the  changes to an Interest Period
      referred to in this Clause 11.2, it shall promptly notify the Company and
      the Lenders.

11.3  NON-BUSINESS DAYS

      If an Interest Period or Term would otherwise end on a day which is not a
      Business Day, that Interest Period will instead  end on the next Business
      Day  in that calendar month (if there is one) or the  preceding  Business
      Day (if there is not).

11.4  CONSOLIDATION AND DIVISION OF TERM FACILITY LOANS

(a)   Subject to paragraph (b) below, if two or more Interest Periods:

      (i)    relate to Loans under such Term Facility and in the same currency;
             and

      (ii)   end on the same date; and

      (iii)  are made to the same Borrower,

      those  Term  Facility  Loans  will, unless that Borrower specifies to the
      contrary  in  the Selection Notice  for  the  next  Interest  Period,  be
      consolidated into,  and treated as, a single Loan under the Term Facility
      on the last day of the Interest Period.

(b)   Subject to Clause 4.3 (Maximum Number of Loans and Letters of Credit) and
      Clause 5.3 (Currency  and  Amount), if a Borrower requests in a Selection
      Notice that the Term Facility  Loan  be  divided into up to six (6) Loans
      under a Term Facility, that Term Facility  Loan  will, on the last day of
      its  Interest  Period,  be  so  divided  with amounts specified  in  that
      Selection Notice, being an amount equal to  the  amount  in  Euros of the
      Term  Facility  Loan  immediately before its division, having taken  into
      account any repayment to be made on that day.

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12.   CHANGES TO THE CALCULATION OF INTEREST

12.1  ABSENCE OF QUOTATIONS

      Subject to Clause 12.2 (Market Disruption), if EURIBOR or, if applicable,
      LIBOR is to be determined  by  reference  to  the  Reference  Banks but a
      Reference Bank does not supply a quotation by the Specified Time  on  the
      Quotation Day, the applicable EURIBOR or LIBOR shall be determined on the
      basis of the quotations of the remaining Reference Banks.

12.2  MARKET DISRUPTION

(a)   If  a  Market  Disruption  Event  occurs  in  relation  to a Loan for any
      Interest Period, then the rate of interest on each Lender's share of that
      Loan for the Interest Period shall be the rate per annum which is the sum
      of:

      (i)    the Margin;

      (ii)   the rate notified to the Facility Agent by that Lender  as soon as
             practicable and in any event before interest is due to be  paid in
             respect of that Interest Period, to be that which expresses  as  a
             percentage  rate  per annum the cost to that Lender of funding its
             participation in that  Loan from whatever source it may reasonably
             select; and

      (iii)  the  Mandatory  Cost,  if  any,   applicable   to   that  Lender's
             participation in the Loan.

(b)   In this Agreement "MARKET DISRUPTION EVENT" means:

      (i)    at  or  about noon on the Quotation Day for the relevant  Interest
             Period the  Screen  Rate  is not available and none or only one of
             the Reference Banks supplies  a  rate  to  the  Facility  Agent to
             determine  EURIBOR  or,  if  applicable,  LIBOR  for  the relevant
             currency and Interest Period; or

      (ii)   before  close of business in Luxembourg on the Quotation  Day  for
             the  relevant   Interest   Period,  the  Facility  Agent  receives
             notifications from a Lender  or Lenders (whose participations in a
             Loan exceed fifty (50) per cent. of that Loan) that the cost to it
             of obtaining matching deposits  in  the  Relevant Interbank Market
             would be in excess of EURIBOR or, if applicable, LIBOR.

12.3  ALTERNATIVE BASIS OF INTEREST OR FUNDING

(a)   If a Market Disruption Event occurs and the Facility Agent or the Company
      so  requires,  the  Facility  Agent  and  the  Company shall  enter  into
      negotiations (for a period of not more than thirty (30) days) with a view
      to agreeing a substitute basis for determining the  rate  of interest. If
      no  agreement is reached, Clause 12.2 (Market Disruption) shall  continue
      to apply.

(b)   Any alternative  basis agreed pursuant to paragraph (a) above shall, with
      the prior consent  of  all the Lenders and the Company, be binding on all
      Parties.

12.4  BREAK COSTS

(a)   Each Borrower shall, within  three  (3)  Business  Days  of demand by the
      Facility Agent acting on behalf of a Finance Party, pay to  the  Facility
      Agent  on  demand  for  the account of that Finance Party its Break Costs
      attributable to all or any  part  of  a  Loan or Unpaid Sum

                                       57

<PAGE>


      being paid by that Borrower on a day  other  than  the  last  day  of  an
      Interest Period or Term for that Loan or Unpaid Sum.

(b)   Each Lender shall, as soon as reasonably practicable  after  a  demand by
      the  Facility  Agent, provide a certificate confirming the amount of  its
      Break Costs for any Interest Period in which they accrue.

13.   FEES

13.1  COMMITMENT FEE

(a)   The Company shall,  in  respect  of  each  Term Facility (except for Term
      Facility C), pay to the Facility Agent (for the account of each Lender) a
      commitment fee in Euros, as the case may be,  computed  from  the Signing
      Date until the earlier of (i) the relevant Utilisation Date and  (ii) the
      date  on  which the relevant Facility has been cancelled, at the rate  of
      the lower of  (i)  fifty  (50)  per  cent. of the Margin on that Lender's
      Available Commitment under each Term Facility; and (ii) one (1) per cent.
      per annum for the Availability Period applicable to that Term Facility.

(b)   The Company shall, in respect of the Revolving  Credit  Facility,  pay to
      the  Facility Agent (for the account of each Lender) a commitment fee  in
      Euros  computed  at  the rate of the lower of (i) fifty (50) per cent. of
      the  Margin  on  that  Lender's  Available  Commitment  under  each  Term
      Facility; and (ii) one (1)  per  cent.  per  annum  for  the Availability
      Period applicable to the Revolving Credit Facility.

(c)   Accrued  commitment  fees are payable on the last day of each  successive
      period of three (3) Months  which  ends  during the relevant Availability
      Period, on the last day of the relevant Availability  Period  and  on the
      cancelled  amount  of  the  relevant  Lender's Commitment at the time the
      cancellation is effective.

13.2  AGENCY FEE

      The Company shall pay to the Facility Agent  (for  its  own  account)  an
      agency fee in the amount and at the times agreed in a Fee Letter.

13.3  SECURITY AGENT FEE

      The  Company  shall  pay  to  the  Security Agent (for its own account) a
      security agent fee in the amount and at the times agreed in a Fee Letter.

13.4  LETTER OF CREDIT COMMISSION

(a)   The Company shall in respect of the Letters of Credit pay to the Facility
      Agent (for the account of each Term  Facility B Lender) (for distribution
      in  proportion  to  each  Term  Facility  B  Lender's  Letter  of  Credit
      Proportion of the Letters of Credit) a letter  of  credit  commission  in
      Euros  computed  at  the  rate  of  the  Margin  (as  may  be adjusted in
      accordance with Clause 10.2 (Margin Ratchets)) on the maximum  actual and
      contingent  liabilities of the Term Facility B Lenders under the  Letters
      of Credit less  the  amount of any Cash Collateral provided in respect of
      such Letters of Credit (the "LETTER OF CREDIT COMMISSION RATE").

(b)   The letter of credit commission  shall  be  paid in arrears in respect of
      each  preceding period of three (3) Months (or  such  shorter  period  as
      shall end  on  the  relevant Expiry Date) which

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<PAGE>


      begins during the Term of the  relevant  Letters  of  Credit,  the  first
      payment to be made on the Utilisation Date for such Letters of Credit and
      after that on the first day of each such successive period.

13.5  [INTENTIONALLY LEFT BLANK]

13.6  FRONTING FEE

      The  Fronting  Fee in Euros of 0.25 per cent. per annum shall be paid  by
      the Company to each  Issuing  Bank  on  the amount of such Issuing Bank's
      maximum actual and contingent liabilities  as  a  Issuing  Bank  under  a
      Letter  of  Credit  (less  the amount of any Cash Collateral provided for
      such liabilities and less the amount of the own commitment of the Issuing
      Bank in its capacity as Lender)  payable  in  arrears  in respect of each
      preceding period of three (3) Months (or such shorter period as shall end
      on  the  Expiry  Date)  which  begins during the Term of such  Letter  of
      Credit, the first payment to be  made  on  the  Utilisation  Date for the
      Letter of Credit and after that on the first day of each such  successive
      period.

13.7  SUBFACILITY MARGIN AND COMMITMENT FEE

(a)   Each  Subfacility  Bank  shall, in respect of its Subfacility and to  the
      extent such amounts are actually  received  from the relevant Borrower by
      the Subfacility Bank, pay to the Facility Agent  (for the account of each
      Lender) (for distribution in proportion to each Lender's Revolving Credit
      Facility  Commitment) (i) interest equal to the Margin  applicable  to  a
      Revolving Credit  Facility  Loan  (as  may be adjusted in accordance with
      Clause 10.2 (Margin Ratchets)) on the daily  utilised  amount  under  the
      Subfacility (the "SUBFACILITY MARGIN") and (ii) a commitment fee computed
      at  the  rate  per  annum  set  out in Clause 13(1)(b) above on the daily
      unutilised  amount  under the Subfacility  (the  "SUBFACILITY  COMMITMENT
      FEE").

(b)   The Subfacility Margin  and  the  Subfacility  Commitment  Fee  shall  be
      payable monthly in arrears.

13.8  SUBFACILITY FEE

      Each  Borrower  shall, in respect of each Subfacility established for it,
      pay to the relevant  Subfacility  Bank for the latter's own account a fee
      on the amount of such Subfacility from  day  to  day  during  the  period
      beginning  with  the  date  of  the  establishment of the Subfacility and
      ending on the date on which such Subfacility  expires  in accordance with
      the  terms of this Agreement, such fee to be calculated at  the  rate  of
      0.25 per cent. per annum payable monthly in arrears.



                                  SECTION 6

                        ADDITIONAL PAYMENT OBLIGATIONS

14.   TAX GROSS UP AND INDEMNITIES

14.1  DEFINITIONS

(a)   In this Clause 14:

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      "PROTECTED PARTY" means a Finance Party that is or will be subject to any
      liability,  or  required to make any payment, for or on account of Tax in
      relation to a sum  received  or  receivable  (or  any  sum deemed for the
      purposes of Tax to be received or receivable) under a Finance Document.

      "TAX  CREDIT"  means  a  credit  against,  relief  or remission  for,  or
      repayment of, any Tax.

      "TAX DEDUCTION" means a deduction or withholding for or on account of Tax
      from a payment under a Finance Document.

      "TAX PAYMENT" means an increased payment made by an  Obligor to a Finance
      Party  under  Clause 14.2  (Tax Gross-up) or a payment under  Clause 14.3
      (Tax Indemnity).

(b)   In this Clause 14 a reference  to  "DETERMINES"  or  "DETERMINED" means a
      determination  made in the absolute discretion of the person  making  the
      determination.

14.2  TAX GROSS-UP

(a)   Each Obligor shall  make  all  payments  to be made by it without any Tax
      Deduction, unless a Tax Deduction is required by law.

(b)   A Borrower shall promptly upon becoming aware that an Obligor must make a
      Tax Deduction (or that there is any change  in the rate or the basis of a
      Tax Deduction) notify the Facility Agent accordingly. Similarly, a Lender
      shall notify the Facility Agent on becoming so  aware  in  respect  of  a
      payment  payable  to  that  Lender.  If  the Facility Agent receives such
      notification from a Lender it shall notify the relevant Borrower and that
      Obligor.

(c)   If  a Tax Deduction is required by law to be  made  by  an  Obligor,  the
      amount  of  the  payment  due  from that Obligor shall be increased to an
      amount which (after making any Tax  Deduction)  leaves an amount equal to
      the  payment  which  would  have  been due if no Tax Deduction  had  been
      required.

(d)   An Obligor is not required to make an increased payment to a Lender under
      paragraph (c) above for a Tax Deduction  in  respect  of tax imposed on a
      payment of interest on a Loan, if on the date on which  the payment falls
      due,  the  Obligor  making  the payment is able to demonstrate  that  the
      payment:

      (i)    relates to a Tax referred to in Clause 14.3(b); or

      (ii)   could have been made to  the  Lender without the Tax Deduction had
             that  Lender  complied with its obligations  under  paragraph  (g)
             below.

(e)   If an Obligor is required  to  make  a  Tax Deduction, that Obligor shall
      make that Tax Deduction and any payment required  in connection with that
      Tax Deduction within the time allowed and in the minimum  amount required
      by law.

(f)   Within thirty (30) days of making either a Tax Deduction or  any  payment
      required  in connection with that Tax Deduction, the Obligor making  that
      Tax Deduction  shall  deliver to the Facility Agent for the Finance Party
      entitled to the payment  evidence reasonably satisfactory to that Finance
      Party  that the Tax Deduction  has  been  made  or  (as  applicable)  any
      appropriate payment paid to the relevant taxing authority.

(g)   A Finance  Party  and  each  Obligor  that  makes a payment to which that
      Finance Party is entitled shall, to the extent practicable, co-operate in
      completing any procedural formalities

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<PAGE>


      necessary  in  due  time  for  that Obligor   to   obtain   authorisation
      to make that payment without a Tax Deduction.

14.3  TAX INDEMNITY

(a)   The  Company  shall  (within  three (3) Business Days of  demand  by  the
      Facility Agent) pay to a Protected  Party  an  amount  equal to the loss,
      liability  or cost that that Protected Party determines will  be  or  has
      been (directly  or  indirectly) suffered for or on account of Tax by that
      Protected Party.

(b)   Paragraph (a) above shall not apply with respect to any Tax assessed on a
      Finance Party:

      (i)    under the law  of  the jurisdiction in which that Finance Party is
             incorporated or, if different, the jurisdiction (or jurisdictions)
             in  which that Finance  Party  is  treated  as  resident  for  tax
             purposes  or,  for  the  avoidance  of doubt, caused by its German
             limited tax liability (beschrankte Steuerpflicht); or

      (ii)   under the law of the jurisdiction in  which  that  Finance Party's
             Facility  Office  is  located  in  respect of amounts received  or
             receivable in that jurisdiction,

      if in either case that Tax is imposed on or  calculated  by  reference to
      the  net  income  received  or receivable (but not any sum deemed  to  be
      received or receivable) by that Finance Party.

(c)   A Protected Party making, or  intending  to  make,  a  claim  pursuant to
      paragraph (a) above shall promptly notify the Facility Agent of the event
      which  will  give,  or has given, rise to the claim, following which  the
      Facility Agent shall notify the Company.

(d)   A Protected Party shall,  on  receiving  a  payment from an Obligor under
      this Clause 14.3, notify the Facility Agent.

14.4  TAX CREDIT

(a)   If  an  Obligor  makes  a  Tax  Payment  and the relevant  Finance  Party
      determines that:

      (i)    a Tax Credit is attributable to that Tax Payment; and

      (ii)   that Finance Party has obtained, utilised  and  retained  that Tax
             Credit,

      the  Finance  Party shall pay an amount to the Obligor which that Finance
      Party determines will leave it (after that payment) in the same after-Tax
      position as it would have been in had the Tax Deduction not been required
      by law.

(b)   If such a Tax Credit  by  reference  to  which a Finance Party has made a
      payment  to  an  Obligor  under  paragraph  (a)   above  is  subsequently
      disallowed  or  cancelled, the Obligor must reimburse  any  payment  made
      under paragraph (a) above to the relevant Finance Party.

(c)   If an Obligor makes  a  Tax  Payment,  a  Finance  Party  shall  take all
      reasonable  steps  to  claim  a  Tax Credit unless in the opinion of that
      Finance Party the making of such claim  might  have  an adverse effect on
      its business, operations, property, condition or prospects  (financial or
      otherwise).  The  relevant  Obligor  shall bear any costs incurred  by  a
      Finance Party in making such a claim.

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14.5  STAMP TAXES

      The Company shall pay and, within three  (3)  Business  Days  of  demand,
      indemnify  each  Finance  Party  against any cost, loss or liability that
      Finance Party incurs in relation to  all  stamp  duty,  registration  and
      other  similar  Taxes  payable  in  respect of any Finance Document. Each
      Finance Party shall use best efforts  to avoid incurring such stamp duty,
      registration and other similar Taxes in  circumstances  where it would be
      reasonable for it to do so.

14.6  VALUE ADDED TAX

(a)   All  consideration payable under a Finance Document by an  Obligor  to  a
      Finance  Party  shall  be  deemed  to  be exclusive of any VAT. If VAT is
      chargeable, the Obligor shall pay to the  Finance  Party  (in addition to
      and at the same time as paying the consideration) an amount  equal to the
      amount of the VAT.

(b)   Where a Finance Document requires an Obligor to reimburse a Finance Party
      for any costs or expenses, that Obligor shall also at the same  time  pay
      and indemnify that Finance Party against all VAT incurred by that Finance
      Party  in  respect  of the costs or expenses save to the extent that that
      Finance Party is entitled to repayment or credit in respect of the VAT.

15.   INCREASED COSTS

15.1  INCREASED COSTS

(a)   Subject to Clause 15.3  (Exceptions)  the Company shall, within three (3)
      Business Days of a demand by the Facility Agent, pay for the account of a
      Finance Party the amount of any Increased  Costs incurred by that Finance
      Party or any of its Affiliates as a result of:

      (i)    the introduction of or any change in  (or in the interpretation or
             application of) any law or regulation; or

      (ii)   compliance with any law or regulation made after the Signing Date.

(b)   In this Agreement "INCREASED COSTS" means:

      (i)    a reduction in the rate of return from  the  Facilities  or  on  a
             Finance Party's (or its Affiliate's) overall capital;

      (ii)   an additional or increased cost; or

      (iii)  a  reduction  of  any  amount  due  and  payable under any Finance
             Document,

      which is incurred or suffered by a Finance Party or any of its Affiliates
      to  the  extent  that  it  is attributable to that Finance  Party  having
      entered into its Commitment  or  funding  or  performing  its obligations
      under any Finance Document or any Letter of Credit.

15.2  INCREASED COST CLAIMS

(a)   A  Finance  Party  intending  to  make  a  claim  pursuant to Clause 15.1
      (Increased  Costs) shall notify the Facility Agent of  the  event  giving
      rise to the claim,  following  which  the  Facility  Agent shall promptly
      notify the Company.

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<PAGE>


(b)   Each Finance Party shall, as soon as practicable after  a  demand  by the
      Facility  Agent  or  the  Company,  provide  a certificate confirming the
      amount of its Increased Costs in and supported  in  reasonable  detail in
      abstract terms.

15.3  EXCEPTIONS

(a)   Clause 15.1  (Increased Costs) does not apply to the extent any Increased
      Cost is:

      (i)    attributable  to  a Tax Deduction required by law to be made by an
             Obligor;

      (ii)   compensated for by Clause 14.3 (Tax Indemnity) (or would have been
             compensated for under  Clause 14.3  (Tax Indemnity) but was not so
             compensated solely because one of the exclusions in Clause 14.3(b)
             applied);

      (iii)  compensated for by the payment of the Mandatory Cost; or

      (iv)   attributable to the breach by the relevant  Finance  Party  or its
             Affiliates of any law or regulation.

(b)   In  this  Clause 15.3,  a  reference  to  a  "TAX DEDUCTION" has the same
      meaning given to the term in Clause 14.1 (Definitions).

16.   OTHER INDEMNITIES

16.1  CURRENCY INDEMNITY

(a)   If any sum due from an Obligor under the Finance  Documents (a "SUM"), or
      any order, judgment or award given or made in relation  to  a Sum, has to
      be converted from the currency (the "FIRST CURRENCY") in which  that  Sum
      is  payable into another currency (the "SECOND CURRENCY") for the purpose
      of:

      (i)    making or filing a claim or proof against that Obligor;

      (ii)   obtaining  or enforcing an order, judgment or award in relation to
             any litigation or arbitration proceedings,

      that  Obligor shall  as  an  independent  obligation,  within  three  (3)
      Business Days of demand, indemnify each Finance Party to whom that Sum is
      due against  any cost, loss or liability arising out of or as a result of
      the conversion including any discrepancy between (A) the rate of exchange
      used to convert that Sum from the First Currency into the Second Currency
      and (B) the rate  or  rates  of  exchange available to that person at the
      time of its receipt of any amount paid to it in satisfaction, in whole or
      in part, of such claim, proof, order, judgment or award.

(b)   Each Obligor waives any right it may  have in any jurisdiction to pay any
      amount under the Finance Documents in a  currency  or currency unit other
      than that in which it is expressed to be payable.

16.2  OTHER INDEMNITIES

      The Company shall (or shall procure that an Obligor  will),  within three
      (3)  Business  Days  of demand, indemnify each Finance Party against  any
      reasonable cost, loss  or  liability  incurred by that Finance Party as a
      result of:

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      (a)    funding, or making arrangements  to  fund,  its participation in a
             Loan requested by a Borrower in a Utilisation Request but not made
             by reason of the operation of any one or more of the provisions of
             this Agreement (other than by reason of default  or  negligence by
             that Finance Party alone);

      (b)    issuing, or making arrangements to issue any Letter of  Credit but
             not  issued by reason of the operation of any one or more  of  the
             provisions of this Agreement; or

      (c)    any Outstandings  (or  part of any Outstandings) not being prepaid
             in accordance with a notice of prepayment given by a Borrower.

16.3  INDEMNITY TO THE FACILITY AGENT AND THE SECURITY AGENT

      The Company shall promptly indemnify  the Facility Agent and the Security
      Agent against any cost, loss or liability  incurred by the Facility Agent
      or the Security Agent (in each case acting reasonably) as a result of:

      (a)    investigating any event which it reasonably believes is a Default;

      (b)    (in the case of the Facility Agent) entering  into  or  performing
             any foreign exchange contract for the purposes of Clause 6 (Change
             of Currency); or

      (c)    acting  or relying on any notice, request or instruction which  it
             reasonably  believes  to  be  genuine,  correct  and appropriately
             authorised.

17.   MITIGATION BY THE LENDERS

17.1  MITIGATION

(a)   Each  Finance  Party  shall, in consultation with the Company,  take  all
      reasonable steps to mitigate  any  circumstances  which  arise  and which
      would  result in any amount becoming payable under, or cancelled pursuant
      to,  any   of   Clause 9.1  (Illegality),  Clause 14  (Tax  Gross-Up  and
      Indemnities) or Clause 15  (Increased  Costs)  including (but not limited
      to) transferring its rights and obligations under  the  Finance Documents
      to another Affiliate or Facility Office.

(b)   Paragraph  (a)  above  does not in any way limit the obligations  of  any
      Obligor under the Finance Documents.

17.2  LIMITATION OF LIABILITY

(a)   The Company shall indemnify each Finance Party for all costs and expenses
      reasonably incurred by that  Finance  Party as a result of steps taken by
      it under Clause 17.1 (Mitigation).

(b)   A  Finance  Party  is not obliged to take  any  steps  under  Clause 17.1
      (Mitigation)  if,  in   the   opinion   of  that  Finance  Party  (acting
      reasonably),  to  do  so  might  be prejudicial  to  it  or  any  of  its
      Affiliates.

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18.   COSTS AND EXPENSES

18.1  TRANSACTION EXPENSES

      Unless and to the extent agreed otherwise,  the Company shall promptly on
      demand pay to the Documentation Agent, the Facility  Agent,  the Security
      Agent  and  the  Mandated  Lead  Arrangers  the  amount of all costs  and
      expenses (including legal fees) reasonably incurred  by  any  of  them in
      connection   with  the  negotiation,  preparation,  printing,  execution,
      syndication and performance of:

      (a)    this Agreement  and  any  other  documents  referred  to  in  this
      Agreement; and

      (b)    any other Finance Documents executed after the Signing Date.

18.2  AMENDMENT COSTS

      If:

      (a)    an Obligor requests an amendment, waiver or consent; or

      (b)    an   amendment   is  required  pursuant  to  Clause 6  (Change  of
      Currency),

      the Company shall, within  three  (3)  Business Days of demand, reimburse
      the Documentation Agent, the Facility Agent  and  the  Security Agent for
      the  amount  of all costs and expenses (including legal fees)  reasonably
      incurred by the Facility Agent or the Security Agent, as the case may be,
      in responding  to, evaluating, negotiating or complying with that request
      or requirement.

18.3  ENFORCEMENT COSTS

      The Company shall,  within three (3) Business Days of demand, pay to each
      Finance Party the amount of all costs and expenses (including legal fees)
      reasonably  incurred  by  that  Finance  Party  in  connection  with  the
      enforcement of, or the  preservation  of  any  rights  under, any Finance
      Document.

18.4  SECURITY AGENT EXPENSES

      The Company shall promptly on demand pay to the Security Agent the amount
      of all costs and expenses (including legal fees) reasonably  incurred  by
      the Security Agent (for its own account and that of any Finance Party) in
      connection with the constitution, administration or release of any of the
      Transaction Security.


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                                   SECTION 7

                                   GUARANTEE

19.   GUARANTEE AND INDEMNITY

19.1  GUARANTEE AND INDEMNITY

      Subject  to  Clause  19.9  (Limitations  for German Guarantors) to Clause
      19.15  (Limitations for Canadian Guarantors)  inclusive,  each  Guarantor
      irrevocably and unconditionally jointly and severally:

      (a)    guarantees (garantiert) to each Finance Party punctual performance
             by  each  Borrower  of  all  that Borrower's obligations under the
             Finance Documents;

      (b)    undertakes with each Finance Party  that  whenever an Obligor does
             not  pay  any  amount  when  due under or in connection  with  any
             Finance Document, that Guarantor  shall  immediately on demand pay
             that amount as if it was the principal obligor; and

      (c)    indemnifies each Finance Party immediately  on  demand against any
             cost,  loss  or liability suffered by that Finance  Party  if  any
             obligation guaranteed  by  it is or becomes unenforceable, invalid
             or illegal. The amount of the  cost,  loss  or  liability shall be
             equal to the amount which that Finance Party would  otherwise have
             been entitled to recover.

19.2  CONTINUING GUARANTEE

      This guarantee is a continuing guarantee and will extend to  the ultimate
      balance  of  sums  payable  by  any  Obligor under the Finance Documents,
      regardless of any intermediate payment or discharge in whole or in part.

19.3  REINSTATEMENT

      If any payment by an Obligor or any discharge  given  by  a Finance Party
      (whether in respect of the obligations of any Obligor or any security for
      those  obligations  or  otherwise) is avoided or reduced as a  result  of
      insolvency or any similar event:

      (a)    the liability of each  Obligor  shall  continue as if the payment,
             discharge, avoidance or reduction had not occurred; and

      (b)    each  Finance  Party shall be entitled to  recover  the  value  or
             amount of that security  or  payment  from each Obligor, as if the
             payment, discharge, avoidance or reduction had not occurred.

19.4  WAIVER OF DEFENCES

      The  obligations  of  each  Guarantor under this Clause 19  will  not  be
      affected by an act, omission, matter or thing which, but for this Clause,
      would reduce, release or prejudice  any  of  its  obligations  under this
      Clause 19  (without  limitation  and  whether  or not known to it or  any
      Finance Party) including:

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      (a)    any time, waiver or consent granted to, or  composition  with, any
             Obligor or other person;

      (b)    the  release  of  any other Obligor or any other person under  the
             terms of any composition  or  arrangement with any creditor of any
             Group Member;

      (c)    the taking, variation, compromise,  exchange,  renewal  or release
             of,  or  refusal  or  neglect to perfect, take up or enforce,  any
             rights against, or security  over  assets of, any Obligor or other
             person or any non-presentation or non-observance  of any formality
             or other requirement in respect of any instrument or  any  failure
             to realise the full value of any security;

      (d)    any incapacity or lack of power, authority or legal personality of
             or dissolution or change in the members or status of an Obligor or
             any other person;

      (e)    any  amendment  (however  fundamental) or replacement of a Finance
             Document or any other document or security;

      (f)    any unenforceability, illegality  or  invalidity of any obligation
             of any person under any Finance Document  or any other document or
             security; or

      (g)    any insolvency or similar proceedings.

19.5  IMMEDIATE RECOURSE

      Each  Guarantor  waives  any  right  it may have of first  requiring  any
      Finance Party (or any trustee or the Facility  Agent  on  its  behalf) to
      proceed against or enforce any other rights or security or claim  payment
      from any person before claiming from that Guarantor under this Clause 19.
      This waiver applies irrespective of any law or any provision of a Finance
      Document to the contrary.

19.6  APPROPRIATIONS

      Until all amounts which may be or become payable by the Obligors under or
      in  connection  with the Finance Documents have been irrevocably paid  in
      full, each Finance  Party  (or  any  trustee or the Facility Agent on its
      behalf) may:

      (a)    refrain from applying or enforcing  any  other moneys, security or
             rights held or received by that Finance Party  (or  any trustee or
             Facility  Agent  on  its  behalf) in respect of those amounts,  or
             apply and enforce the same in such manner and order as it sees fit
             (whether against those amounts  or  otherwise)  and  no  Guarantor
             shall be entitled to the benefit of the same; and

      (b)    hold  in  an interest-bearing suspense account any moneys received
             from any Guarantor  or  on  account  of  any Guarantor's liability
             under this Clause 19.

19.7  DEFERRAL OF GUARANTORS' RIGHTS

      Until all amounts which may be or become payable by the Obligors under or
      in connection with the Finance Documents have been  irrevocably  paid  in
      full  and  unless the Facility Agent otherwise directs, no Guarantor will
      exercise any  rights  which it may have by reason of performance by it of
      its obligations under the Finance Documents:

      (a)    to be indemnified by an Obligor;

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<PAGE>




      (b)    to  claim  any  contribution  from  any  other  guarantor  of  any
             Obligor's obligations under the Finance Documents; and/or

      (c)    to take the benefit  (in  whole  or  in part and whether by way of
             subrogation or otherwise) of any rights  of  the  Finance  Parties
             under  the Finance Documents or of any other guarantee or security
             taken pursuant to, or in connection with, the Finance Documents by
             any Finance Party.

19.8  ADDITIONAL SECURITY

      This guarantee  is in addition to and is not in any way prejudiced by any
      other guarantee or  security  now  or  subsequently  held  by any Finance
      Party.

19.9  LIMITATIONS FOR GERMAN GUARANTORS

(a)   Each  Finance  Party  agrees  that  the enforcement of the guarantee  and
      indemnity pursuant to this Clause 19,  and  any  Security  provided  by a
      Guarantor pursuant to the terms of the Security Documents, other than  in
      respect  of  Loans made available to such Guarantor or to a Subsidiary of
      such Guarantor  by  a  Lender, or by another Obligor from the proceeds of
      Loans, shall be limited,  in  relation  to  any  Obligor  (other than the
      Company)  which  is a German limited liability company (Gesellschaft  mit
      beschrankter  Haftung  -  GmbH) (a  "GERMAN OBLIGOR"), to the extent that
      payment under that guarantee  and  indemnity,  or  the enforcement of the
      Security, would cause the higher of (i) the German Obligor's  net  assets
      (including, for the avoidance of doubt, the amount corresponding to  such
      German  Obligor's  registered  share  capital  (Stammkapital))  as per 31
      December  2003  minus  10 per cent. (the "BASE NET ASSETS") and (ii)  the
      German Obligor's net assets  (including,  for the avoidance of doubt, the
      amount corresponding to such German Obligor's  Stammkapital)  as  per the
      end  of  the  calendar  month  preceding  the date of enforcement of this
      guarantee and indemnity or of any Security  (the "CURRENT NET ASSETS") to
      fall  below  its  Stammkapital  PROVIDED THAT for  the  purposes  of  the
      calculation  of  the Base Net Assets  and  the  Current  Net  Assets  the
      following balance sheet items shall be adjusted as follows:

      (i)    the amount  of  any  increase  of the Stammkapital of the relevant
             German Obligor after the Signing  Date  shall be deducted from the
             relevant Stammkapital;

      (ii)   loans provided to the relevant German Obligor (or to any direct or
             indirect Subsidiary of such German Obligor)  by  any  Group Member
             shall  be  disregarded  if and to the extent such loans have  been
             made from funds made available to a German Obligor pursuant to the
             terms of this Agreement,  or  are  subordinated, or are considered
             subordinated pursuant to Sec. 32a GmbHG; and

      (iii)  loans  and  other  liabilities  incurred   in   violation  of  the
             provisions of this Agreement shall be disregarded,

      and  FURTHER  PROVIDED  THAT  the relevant German Obligor shall  for  the
      purposes of the determination of  the Base Net Assets and the Current Net
      Assets dispose of all assets where  the  relevant assets are shown in the
      balance sheet of the German Obligor with a book value (Buchwert) which is
      significantly  lower than the market value  of  such  assets.  The  above
      limitations shall  not apply if following notification by a Finance Party
      of claims raised under  the  guarantee  and  indemnity  pursuant  to this
      Clause 19,  or of the enforcement of Security by such Finance Party,  the
      relevant German  Obligor  does not provide conclusive evidence, including
      in particular interim financial  statements  up  to  the  end of the last
      completed calendar month (which shall be audited if reasonably  requested
      by  the  Facility

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<PAGE>


      Agent), within twenty five (25) days after the date of such notification,
      or if after receipt of such unaudited statements notification is given to
      the relevant German Obligor to provide audited financial statements up to
      the end of that same calendar month and such audited financial statements
      are  not  provided  within  fifty  (50)  days  after  the  date  of  such
      notification.

(b)   Each German Obligor may at any time request  by  giving written notice to
      the Facility Agent that the amount of the Base Net  Assets  relevant  for
      the  purpose  of  Clause  19.9  (a) is reduced to an amount (the "REDUCED
      AMOUNT") corresponding to the amount  of such German Obligor's actual net
      assets (to be determined as set out in  paragraph  (a)  above),  less  or
      plus,  as  the  case  may  be,  any decrease or increase to be reasonably
      expected in the course of a period  of one Month from the date of receipt
      by the Facility Agent of the notice (the  "NOTICE PERIOD"). Together with
      any such written request, the relevant German  Obligor  shall provide the
      Facility Agent with reasonable evidence (substantially applying the rules
      applicable    for    setting   up   a   statement   of   overindebtedness
      ("Uberschuldungsstatus"))  showing   the   German   Obligor's  net assets
      position (to be determined as set out in paragraph (a) above), and  shall
      further  provide  the  Facility Agent with a written confirmation setting
      out the German Obligor's  projected  net  assets  as  per  the end of the
      Notice Period and stating the reasons therefor in reasonable detail. Upon
      the  lapse of the Notice Period, the Base Net Assets shall be  deemed  to
      correspond to the Reduced Amount, unless the Lenders have terminated this
      Agreement  in  accordance  with  the  provisions  of  this  Agreement and
      notified the respective German Guarantor thereof before the lapse of such
      Notice Period.

19.10 LIMITATIONS FOR AUSTRIAN OBLIGORS

      Each Guarantor established in Austria ("AUSTRIAN GUARANTOR") acknowledges
that:

      (i)    it will receive valuable direct or indirect benefits as  a  result
             of  the  Facilities  or  Subfacilities  made  available under this
             Agreement;

      (ii)   the  Borrowers  of  the  Facilities  shall  pay  to each  Austrian
             Guarantor an adequate and arm's length annual fee for granting the
             guarantee under this Clause 19;

      (iii)  each Finance Party has acted in good faith in connection  with the
             guarantee  given  by  that Austrian Guarantor and the transactions
             contemplated by the Finance Documents; and

      (iv)   it has not incurred and  does not intend to incur debts, including
             contingent liabilities beyond its ability to pay as they mature.

(b)   Notwithstanding anything to the contrary  contained  herein  or any other
      Finance Document the liability of each Austrian Guarantor:

      (i)    shall  be  limited  to  funds  applied  by  the Borrowers for  the
             valuable  direct or indirect benefits of the Austrian  Guarantors;
             and

      (ii)   shall be limited to an amount of:

             (A)   the Future  Additional  Net  Asset  Value  of  that Austrian
                   Guarantor; in addition, if applicable,

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<PAGE>


             (B)   the  equivalent in Euro of the aggregate Utilisations  (plus
                   accrued  interest commission and fee thereon) on-lent to the
                   respective  Austrian  Guarantor  calculated  by the Facility
                   Agent on the date which Utilisation(s) are made.

             For the purposes of this Clause 19.10 "FUTURE ADDITIONAL NET ASSET
             VALUE" means the future increase of the value of the balance sheet
             positions  "Eigenkapital"  (as  defined  under  the provisions  of
             Austrian accounting laws, currently Art. 224 sec. 3 lit A Austrian
             Commercial Code) as of the date of the execution of this Agreement
             (the "REFERENCE NET ASSET VALUE") as opposed to the  value of this
             balance sheet position on the day of the payment demand  under the
             Guarantee  pursuant  to  this  Clause  19.  An  interim  financial
             statement of that Austrian Guarantor established upon the  date of
             the  execution  of  this  Agreement and certified by the statutory
             auditors of that Austrian Guarantor  shall be prima facie evidence
             as to the amount of the Reference Net Asset Value.

(c)   Each Austrian Guarantor shall procure to record  its potential obligation
      under  its  guarantee and indemnity pursuant to this  Clause  19  in  its
      financial statements  to  be  established  after  the  execution  of this
      Agreement  or its Accession to this Agreement, respectively, pursuant  to
      Art. 199 Austrian Commercial Code.

(d)   Each Austrian  Guarantor  agrees  that  the benefit of this guarantee and
      indemnity shall be transferred and shall remain in full legal effect when
      an Existing Lender (as defined in Clause 25 (Changes to Lenders) seeks to
      transfer  its  rights  and obligations under  the  Finance  Documents  by
      assignment or by novation  to a New Lender pursuant to Clause 25 (Changes
      to Lenders).

19.11 LIMITATIONS FOR FRENCH OBLIGORS

(a)   Each Guarantor organised under  the laws of France (a "FRENCH GUARANTOR")
      acknowledges that

      (i)   it has not incurred and does  not  intend to incur debts, including
            contingent liabilities beyond its ability to pay as they mature;

      (ii)  the guarantee and indemnity has been  authorised by the assembly of
            the shareholders before the contract had  been signed as defined in
            articles L 227-9 and L 227-10 of the French Commercial Code if such
            an authorisation is necessary according to  article  L  225-38  and
            article L 223-19 French Commercial Code.

(b)   The  liability of each French Guarantor under this Clause 19.11 (A) shall
      not include  any obligation which does not present an economic, social or
      financial interest  for  the  entire group, (B) shall be limited to funds
      applied by the Borrowers for the  valuable direct or indirect benefits of
      the French Guarantors; (C) shall not  include  any  obligation  which  is
      contrary  to  the statutory object of the French Guarantor, (D) shall not
      include any obligation  which  if incurred would constitute the provision
      of financial assistance as defined  by  article  L  225-216 of the French
      Commercial Code and (E) shall be limited at any time to the greater of:

            (aa)   the  equivalent  to  Euros  of the Loans (plus  any  accrued
                   interest thereon, commissions  and  fees)  made available to
                   any   Obligor   (other  than,  if  applicable,  the   French
                   Guarantor) to the  extent  directly or indirectly on-lent to
                   the French Guarantor calculated by the Facility Agent on the
                   date on

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                    which such Loan(s) are made, to the extent that such Loan(s)
                    have been on lent by such  Obligor to the French  Guarantor;
                    and

            (bb)   70 per cent. of the greater of:

                   (i)   the Net Asset Value of the French Guarantor calculated
                         and  certified by the statutory auditors of the French
                         Guarantor  on  the basis of the last audited financial
                         statements available at the date hereof; and

                   (ii)  the Net Asset Value of the French Guarantor calculated
                         and certified by  the statutory auditors of the French
                         Guarantor on the basis  of  the last audited financial
                         statements available at the date  on  which  demand is
                         made on it pursuant to this Clause 19 .

      For the purposes of this Clause 19.11(b) "NET ASSET VALUE" of the  French
      Guarantor means the capitaux propres (as defined under the provisions  of
      French  accounting laws, decrees and regulations consistently applied) of
      the French  Guarantor.  A  certificate  of  the statutory auditors of the
      French Guarantor as to the Net Asset Value shall  be prima facie evidence
      as to the amount to which it relates.

19.12 LIMITATIONS FOR ITALIAN OBLIGORS

      Each  Finance  Party  agrees  that the enforcement of the  guarantee  and
      indemnity given pursuant to this  Clause 19 by any Guarantor incorporated
      in  Italy (an "ITALIAN GUARANTOR") shall  be  limited  as  follows:  each
      Italian  Guarantor  shall not be liable for any amounts in respect of the
      guarantee and indemnity pursuant to this Clause 19 in excess of an amount
      of [e]20,000,000.

19.13 LIMITATIONS FOR SPANISH OBLIGORS

      Each Finance Party agrees  that  the  guarantee,  indemnity and any other
      obligations  of  each  Guarantor  incorporated  in  Spain   (a   "SPANISH
      GUARANTOR")  assumed  under  this  Agreement  and  any  Security provided
      pursuant to the terms of this Agreement by a Spanish Guarantor  shall not
      include and shall not extend to any amount of the Facilities utilised  in
      breach  of  Article 81.1 of Spanish Corporation's Act ("Ley de Sociedades
      Anonimas")  to  fund  the  acquisition  of  such Spanish Guarantor and/or
      the acquisition of its dominant  company  and/or future upstream dominant
      companies, together with interest accrued thereon  or other amounts owing
      in respect thereof under this Agreement.

19.14 LIMITATIONS FOR US OBLIGORS

      Each  Finance  Party  agrees  that the enforcement of the  Guarantee  and
      Indemnity pursuant to this Clause  19,  and  any  Security  provided by a
      Guarantor  organized  under  the laws of a state of the United States  of
      America (a "U.S. GUARANTOR") pursuant  to  the  terms  of this Agreement,
      other than in respect of Loans made available to such U.S.  Guarantor  or
      to a Subsidiary of such U.S. Guarantor by a Lender, or by another Obligor
      from  the  proceeds  of  Loans, shall be limited, in relation to any U.S.
      Guarantor,  to  the  greatest   amount   that   would   not  render  such
      U.S. Guarantor's  obligations  hereunder  subject  to  avoidance   as   a
      fraudulent  transfer  or  conveyance under Section 548 of Title 11 of the
      United  States  Code  or  any  provisions   of   applicable   state   law
      (collectively, the "FRAUDULENT TRANSFER LAWS"), in each case after giving
      effect  to  all  other  liabilities of such U.S. Guarantor, contingent or
      otherwise,  that  are  relevant   under   the  Fraudulent  Transfer  Laws
      (specifically excluding, however, any liabilities  of such U.S. Guarantor
      (a) in respect of Intra-Group Loans to the extent that  such indebtedness
      would be discharged in an amount equal to the amount paid

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<PAGE>


      by such U.S. Guarantor  hereunder  and (b) under  any guarantee of senior
      unsecured  indebtedness or Subordinated  Debt, which guarantee contains a
      limitation  as to  maximum  amount  similar  to that  set  forth  in this
      paragraph,  pursuant  to  which  the  liability  of such  U.S.  Guarantor
      hereunder  is  included  in  the   liabilities   taken  into  account  in
      determining such maximum amount) and after giving effect as assets to the
      value (as determined  under the  applicable  provisions of the Fraudulent
      Transfer Laws) of any rights to subrogation, contribution, reimbursement,
      indemnity  or  similar  rights of such  U.S.  Guarantor  pursuant  to (i)
      applicable  law  or  (ii)  any  agreement   providing  for  an  equitable
      allocation  among  such  U.S.   Guarantor  and  other  Group  Members  of
      obligations arising under guarantees by such parties.

19.15 LIMITATIONS FOR CANADIAN OBLIGORS

      Each guarantor organised under the federal laws of Canada or any  of  the
      Provinces of Canada (a "CANADIAN GUARANTOR") hereby acknowledges, being a
      direct or indirect subsidiary of the Company, that it will be receiving a
      direct  and indirect benefit from the Loans being provided to the Company
      and the other  Borrowers, and hereby acknowledges and confirms that it is
      providing the guarantee  contained herein in consideration of such direct
      or indirect benefit, and for other good and valuable consideration.



                                   SECTION 8

              REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

20.   REPRESENTATIONS

20.1  REPRESENTATION AND WARRANTIES

      (a)    On the Signing Date,  the  Company  (in respect of its own affairs
             and each Group Member), each Original  Obligor  (in respect of its
             own affairs and those of its Subsidiaries) and, on the date of its
             accession to this Agreement, each Additional Obligor  (in  respect
             of  its  own  affairs  and  those  of  its Subsidiaries) makes the
             representations and warranties set out in  this  Clause 20 to each
             Finance Party.

      (b)    The  Obligors  acknowledge  that the Finance  Parties have entered
             into this  Agreement  in  reliance  on these  representations  and
             warranties.

20.2  STATUS

      (a)    It is a corporation or limited  partnership,  duly incorporated or
             formed and validly  existing under the law of the  jurisdiction of
             its place of incorporation or its seat.

      (b)    It has the power to own its assets and carry on its business as it
             is currently being conducted.

20.3  NO WINDING-UP

      No administrator, receiver, insolvency trustee, examiner,  liquidator  or
      similar  officer or official has been appointed with respect to it or any
      of its assets  and  (to the best of its knowledge and belief) no petition
      by a third party or proceeding  for  any  such appointment is pending nor
      has any resolution for any such appointment been passed.

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20.4  BINDING OBLIGATIONS

      The obligations expressed to be assumed by it in each Finance Document to
      which  it  is  a  party  are, subject to any general  principles  of  law
      limiting its obligations which  are specifically referred to in any legal
      opinion delivered pursuant (i) to  Clause  4 (Conditions of Utilisation),
      (ii)  Clause  26  (Changes  to  the  Obligors) or  (iii)  the  conditions
      precedent set forth in the Finance Documents,  legal,  valid, binding and
      enforceable obligations.

20.5  NON-CONFLICT WITH OTHER OBLIGATIONS

      The   entry   into  and  performance  by  it  of,  and  the  transactions
      contemplated by,  the Finance Documents to which it is a party do not and
      will not conflict with:

      (a)    any law or regulation applicable to it;

      (b)    its constitutional documents; or

      (c)    any agreement or instrument binding upon it or any of its assets,

      nor will such entry  into  and  performance  (except  as  provided in any
      Security  Documents) result in the creation of, or oblige it  to  create,
      any Security (other than Permitted Security) over any of its assets.

20.6  POWER AND AUTHORITY

      It has the  power  to  enter into, perform and deliver, and has taken all
      necessary action to authorise  its  entry  into, performance and delivery
      of,  the Finance Documents to which it is a party  and  the  transactions
      contemplated  by  those Finance Documents. No limit on its powers will be
      exceeded as a result of such entry, delivery or performance.

20.7  VALIDITY AND ADMISSIBILITY IN EVIDENCE

      All Authorisations required:

      (a)    to enable it  lawfully  to  enter  into,  exercise  its rights and
             comply with its obligations in the Finance Documents  to  which it
             is a party;

      (b)    to make the Finance Documents to which it is a party admissible in
             evidence in its jurisdiction of incorporation;

      (c)    to  enable it to own its material assets and carry on its business
             as it is being conducted; and

      (d)    to enable  it to create any Security expressed to be created by it
             by or pursuant  to,  or as the case may be, any Security expressed
             to have been created by  it  and  to be evidenced in, any Security
             Document and to ensure that such Security  has  the  priority  and
             ranking it is expressed to have,

      have  (save  for any filings or registrations required in relation to the
      Security Documents,  which filings or registrations will be made promptly
      after execution of the  relevant  documents  no later than the time frame
      agreed with the Security Agent and in any event  within  applicable  time
      limits) been obtained or effected and are in full force and effect.

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20.8  GOVERNING LAW AND ENFORCEMENT

      (a)    The  choice  of German  law as the  governing  law of the  Finance
             Documents  (to the extent  they are  expressed  to be  governed by
             German  law),  the  choice  of New York  law for the US Term  Loan
             Agreement and the Intercreditor  Agreement,  and in respect of any
             Security  Document  to  which  it is a party,  the  choice  of the
             relevant  governing  law of that Security  Document,  will in each
             case  be   recognised   and  enforced  in  its   jurisdiction   of
             organisation.

      (b)    Any  judgment  obtained  in the  Federal  Republic  of  Germany in
             relation to a Finance Document (to the extent its provides for the
             jurisdiction  of a German  court),  any  judgment  obtained in the
             relevant  US Federal or New York state court in relation to the US
             Term Loan  Agreement  and the  Intercreditor  Agreement  (with the
             exemption of any Obligor  incorporated in Poland),  and in respect
             of any  Security  Document  to which it is a party,  any  judgment
             obtained in the courts which are expressed to have jurisdiction to
             hear disputes under that Security Document) will be recognised and
             enforced in its jurisdiction of organisation

20.9  DEDUCTION OF TAX

      It  is  not required under the law of its jurisdiction  of  incorporation
      (other than  Italy)  to  make any deduction for or on account of Tax from
      any payment it may make under any Finance Document.

20.10 NO FILING OR STAMP TAXES

      It is not necessary that the  Finance  Documents  be  filed,  recorded or
      enrolled with any Government Agency in any jurisdiction where an  Obligor
      is domiciled or that any stamp, registration or similar tax be paid on or
      in  relation  to  the  Finance Documents or the transactions contemplated
      therein (save for complying with Perfection Requirements).

20.11 NO DEFAULT AND NO MATERIAL ADVERSE EFFECT

      (a)    No Event of Default is continuing or might  reasonably be expected
             to result from the making of any Utilisation.

      (b)    No other event or circumstance is outstanding  which constitutes a
             default under any other  agreement or instrument  which is binding
             on it or to which  its  assets  are  subject  which  might  have a
             Material Adverse Effect.

      (c)    No other  event  or  circumstance is outstanding which would, with
             the  lapse of time, the  giving  of  notice,  the  making  of  any
             determination  under  the  relevant document or any combination of
             the foregoing, constitute a  default  under any other agreement or
             instrument relating to Financial Indebtedness  which is binding on
             it  or to which its assets are subject which might  reasonably  be
             expected to have a Material Adverse Effect.

      (d)   No  Material   Adverse  Effect  has  occurred  since  the  date  of
            submission of the  latest  financial  statements pursuant to Clause
            21.1(b).

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20.12 INFORMATION

      Any written information provided by the Company  on  its own behalf or on
      behalf  of any Group Member to any Finance Party in connection  with  the
      Finance Documents  was  true  and accurate in all material respects as at
      the date it was provided or as at the date (if any) at which it is stated
      and is not untrue or misleading in any material respect.

20.13 GOOD TITLE TO ASSETS

      Except   in   relation   to   certain   toll    manufacturing   equipment
      (Auftragsfertigung),  it  has, subject to Permitted  Security,  good  and
      marketable title to or valid  leases  or  licenses  of  or  is  otherwise
      entitled to use (in each case, on arm's length terms) all material assets
      necessary to carry on its business as it is being conducted.

20.14 INTELLECTUAL PROPERTY RIGHTS

      (a)    It  owns or has  licensed  to it on  arm's  length  terms  all the
             Intellectual Property Rights which are required by it in order for
             it to carry on its  business  in all  material  respects  as it is
             currently being conducted (the "MATERIAL IPR") and, to the best of
             its  knowledge  and  belief,  it  does  not,  in  carrying  on its
             business,  infringe any Intellectual  Property Rights of any third
             party in any material respect.

      (b)    It has taken all formal or procedural  actions  (including payment
             of fees)  required  to  maintain  in full  force  and  effect  any
             registered Material IPR owned by it.

      (c)    It is  not  aware  of any  adverse  circumstance  relating  to the
             validity,  subsistence or use of any of its Intellectual  Property
             which might  reasonably  be  expected  to have a Material  Adverse
             Effect.

20.15 CREATION OF SECURITY

      (a)    It is, or upon the execution (and the fulfilment of any conditions
             included therein) of the Security Documents to which it is a party
             will be, subject to any Permitted Security, the absolute legal and
             beneficial  owner of all the  assets  over  which it  purports  to
             create Security (other than as provided in any Security  Document)
             by or pursuant to or as evidenced in the Security Documents.

      (b)    Subject to any general  principles of law limiting its obligations
             which are specifically  referred to in any legal opinion delivered
             pursuant (i) to Clause 4 (Conditions of Utilisation),  (ii) Clause
             26 (Changes to the Obligors) or (iii) the Perfection Requirements,
             each Security Document to which it is or is to be a party creates,
             or upon such  execution  will  create,  the  Security  which  that
             Security  Document  purports  to create and with the  ranking  and
             priority it is  expressed  to have or, if that  Security  Document
             purports to evidence Security,  accurately evidences, or upon such
             execution  will so  evidence,  Security  which  has  been  validly
             created.

20.16 PENSION SCHEMES

(a)   Each Group Member is in compliance with all applicable laws and contracts
      relating to the pension schemes (if any) for the time being  operated  by
      it or in which it participates and each such pension scheme is adequately
      provided for (either by way of being funded or by way of provision in the
      balance  sheet)  based  on reasonable actuarial assumptions applicable

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      to the jurisdiction in which  the  relevant pension  scheme is maintained
      and administered and funded in accordance with applicable law.

(b)   Except as disclosed to the Lenders  prior  to the date of this Agreement,
      no  Group  Member  has  (to  the best of its knowledge  and  belief)  any
      liability in respect of any pension scheme and there are no circumstances
      which would give rise to such liability.

20.17 PARI PASSU RANKING

      Its payment obligations under  the  Finance  Documents rank at least pari
      passu with the claims of all its unsecured and  unsubordinated  creditors
      except for obligations mandatorily preferred by law applying to companies
      generally.

20.18 INTRA-GROUP LOANS

      Other   than   the  existing  Intra-Group  Loans  and  similar  financial
      arrangements set  out  in Schedule 16 (Existing Intra-Group Loans), there
      are no other Intra-Group Loans.

20.19 NO PROCEEDINGS PENDING OR THREATENED

      (a)    Subject to paragraph  (c) below,  no  litigation,  arbitration  or
             administrative proceeding of or before any court, arbitral body or
             agency  which,  if  adversely  determined,   might  reasonably  be
             expected to have a Material  Adverse  Effect,  has been started or
             (to the best of its knowledge and belief)  threatened  against it,
             nor are  there  (to the  best of its  knowledge  and  belief)  any
             circumstances  reasonably  likely to give rise to such litigation,
             arbitration  or  administrative  proceeding  which,  if  adversely
             determined,  might  reasonably  be  expected  to  have a  Material
             Adverse Effect.

      (b)    No labour  disputes  which might  reasonably be expected to have a
             Material  Adverse  Effect have (to the best of its  knowledge  and
             belief) been started or threatened against it.

      (c)    Other  than  the  Existing   Competition   Law   Proceedings,   no
             competition  law related (i) civil  litigation,  civil lawsuits or
             other civil  proceedings  of or before any court have been started
             in accordance with the applicable procedural rules or (to the best
             of  its   knowledge   and  belief)   threatened  in  any  relevant
             jurisdiction   against  any  Group  Member  which,   if  adversely
             determined,  might  reasonably  be  expected  to  have a  Material
             Adverse  Effect;  (ii)  fines  other than the EU  Competition  Law
             Liabilities,  the Canadian  Competition Law Liabilities and the US
             Competition  Law  Liabilities  have  been  assessed  by way of any
             administrative   proceedings  by  any  Government   Agency  in  an
             aggregate amount exceeding [e]2,500,000.

20.20 ENVIRONMENTAL COMPLIANCE

      (a)    It has obtained all requisite  Environmental Licences required for
             the carrying on of its business as currently  conducted and has at
             all times complied with:

             (i)   all applicable Environmental Laws;

             (ii)  the terms and conditions of such Environmental Licences; and

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             (iii) all other covenants, conditions, restrictions and agreements
                   directly  or  indirectly concerned  with  any  Environmental
                   Contamination,

             where failure to do so might have a Material Adverse Effect.

      (b)    There are to its knowledge  no  circumstances which may prevent or
             interfere  in any material respect  with  the  compliance  in  the
             future of it  and  each  of  its  Subsidiaries with all applicable
             Environmental  Laws,  the  terms  of  all  Environmental  Licences
             referred to in paragraph (a) above and  all covenants, conditions,
             restrictions and agreements referred to in paragraph (a) above.

20.21 ENVIRONMENTAL RELEASES

      No:

      (a)    property  currently  or  previously  owned,  leased,  occupied  or
             controlled  by  it  (including  any  offsite waste  management  or
             disposal location utilised by it or any  of  its  Subsidiaries) is
             contaminated with any Dangerous Substance; and

      (b)    discharge, release, leaching, migration or escape of any Dangerous
             Substance  into  the Environment has occurred or is occurring  on,
             under or from any property,

      in each case to the best of its knowledge, in circumstances where this is
      reasonably likely to have a Material Adverse Effect.

20.22 ENVIRONMENTAL CLAIMS

      No Environmental Claim has  been started or (to the best of its knowledge
      and belief) threatened against  it or any of its Subsidiaries which might
      reasonably be expected to have a Material Adverse Effect.

20.23 TAXATION

      (a)    It has duly and  punctually  paid and discharged all Taxes imposed
             upon it or its  assets  within  the time  period  allowed  without
             incurring penalties (other than to the extent that: (i) payment is
             being  contested in good faith and in accordance with the relevant
             procedures,  (ii) adequate reserves are being maintained for those
             Taxes in accordance  with Relevant  GAAP, and (iii) payment can be
             lawfully  withheld  and will not result in the  imposition  of any
             material penalty nor in any material  Security ranking in priority
             to the claims of any Finance  Party under any Finance  Document or
             to any Security created under any Security Document; or failure to
             pay is  caused  by  administrative  or  technical  error  that  is
             remedied as soon as possible after receipt of notification thereof
             from the relevant Tax authorities).

      (b)    It is not materially overdue in the filing of any Tax returns.

      (c)    No claims are being or are likely to be  asserted  against it with
             respect to Taxes  which  might  reasonably  be  expected to have a
             Material Adverse Effect.

20.24 NO INDEBTEDNESS

      It has:

      (i)   no Financial Indebtedness (other than Permitted Indebtedness); and

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      (ii)  no other indebtedness, except  for  any  which has been incurred in
            the ordinary course of its business.

20.25 NO SECURITY OR GUARANTEES

      (a)    Other than any Permitted Security:

             (i)   no Security exists over all or any of its assets; and

             (ii)  no arrangement or transaction as described in Clause 23.3(b)
                   has been entered into by it and is outstanding.

      (b)    Other than any Permitted Guarantees or Contingent Liabilities,  it
             has not granted or agreed to grant any guarantee.

20.26 NO IMMUNITY

      In any proceedings taken in its jurisdiction of organisation  in relation
      to  any Finance Document to which it is a party, it will not be  entitled
      to claim  for  itself  or  any  of  its  assets  any  immunity from suit,
      execution, attachment or other legal process.

20.27 [INTENTIONALLY LEFT BLANK]

20.28 BASE FINANCIAL STATEMENTS

(a)   The Base Financial Statements:

      (i)   were prepared in accordance with IFRS or Relevant GAAP consistently
            applied; and

      (ii)  (in the case of the unaudited nine (9) months consolidated  interim
            financial  statements  of  the  Company  for  the  period ending 31
            September  2003)  fairly  represent  the  financial  condition  and
            operations of the Group as at the date to which they were  prepared
            and  during  the  relevant  financial  period  for  which they were
            prepared, subject to normal year end adjustments, and  take account
            of  all  material  liabilities  (contingent or otherwise), and  all
            unrealised or anticipated losses,  of  the  Group as at the date to
            which they were prepared.

(b)   There has been no material adverse change in the  business  or  financial
      condition  of  any  Obligor  since  the  date  to  which  the latest Base
      Financial Statements were prepared.

(c)   The financial year of the Group is the calendar year.

20.29 BUDGETS

(a)   It:

      (i)    regards (as at the date that the most recent  Budget is  delivered
             to the  Facility  Agent under  Clause 21.4  (Budgets))  as neither
             unreasonable,  nor to any material extent unattainable, any of the
             forecasts or projections set out in that Budget;

      (ii)   believes  (after having made all  reasonable  enquiries)  that the
             assumptions,  upon which the forecasts and projections relating to
             the Group  contained  in the most

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             recent  Budget  delivered  under Clause 21.4 (Budgets) are  based,
             are fair and reasonable; and

      (iii)  has made full  disclosure  of all material  facts  relating to the
             Group to all the persons  responsible  for the preparation of each
             Budget.

20.30 GROUP STRUCTURE CHART

(a)   The  Group  Structure  Chart  contains  descriptions,  which   are  true,
      complete  and  correct  in   all  material  respects,  of  the  corporate
      ownership  structure  of  the Group as it will be immediately  after  the
      initial Utilisation after the Closing Date, including details of:

      (i)    all Subsidiaries, direct or indirect, of the Company;

      (ii)   all  minority shareholdings in any Group Member held by any person
             who is not a Group Member;

      (iii)  all companies,  partnerships and Joint Ventures in which any Group
             Member has an interest or participation; and

      (iv)   all Intra-Group Loans in an amount of more than [e]1,000,000 which
             are not merely temporary trading balances.

(b)   There are no re-organisational  steps relating to the corporate ownership
      structure of the Group  contemplated  at the Signing Date  (including any
      significant  transfers of  businesses  or assets from one Group Member to
      another) which are not reflected in the Group Structure Chart.

(c)   All  re-organisational  steps resulting in the Group corporate  ownership
      structure set out in the Group Structure Chart have been or will be taken
      in  compliance  in all  material  respects  with  all  relevant  laws and
      regulations and all requirements of all relevant regulatory authorities.

20.31 ISSUE OF SHARE CAPITAL

      Except for the Management and Employee Benefit Plans, the  Hitco  Options
      and  the  conversion  rights  under  the  Convertible Bonds, there are no
      agreements in force or corporate resolutions  passed  which  call for the
      present  or  further  issue  or allotment of, or grant to any person  the
      right  (whether conditional or  otherwise)  to  call  for  the  issue  or
      allotment  of, any share, partnership interest, loan note or loan capital
      of any Group  Member  (including  an  option  or  right of pre-emption or
      conversion).

20.32 ERISA AND MULTIEMPLOYER PLANS

(a)   Neither any US Group Member nor any ERISA Affiliate is making or accruing
      an  obligation  to  make  contributions  or has  within  any of the  five
      calendar years immediately  preceding the Signing Date made or accrued an
      obligation to make  contributions to any Multiemployer  Plan to an extent
      or in a manner  which  might  reasonably  be  expected to have a Material
      Adverse Effect.

(b)   Each Employee Plan is in compliance in all material  respects in form and
      operation  with  ERISA  and the Code and all  other  applicable  laws and
      regulations.

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(c)   Each Employee Plan which is intended to be qualified under section 401(a)
      of the Code has been  determined  by the IRS to be so  qualified or is in
      the  process of being  submitted  to the IRS for  approval  or will be so
      submitted  during the applicable  remedial  amendment  period and, to the
      knowledge  of the Company,  nothing has  occurred  since the date of such
      determination  that would adversely affect such determination (or, in the
      case of an Employee Plan with no determination, nothing has occurred that
      would adversely affect such qualification).

(d)   The fair  market  value of the assets of each  Employee  Plan  subject to
      Title  IV of  ERISA  is at  least  equal  to  the  present  value  of all
      accumulated  benefit  obligations  under such Employee Plan (based on the
      assumptions  used for the purposes of  Statement of Financial  Accounting
      No. 87) as of the date of the most recent financial statements reflecting
      such amounts or, if  additional  contributions  are required to make such
      Employee  Plan  sufficient,  the Company does not believe that such might
      reasonably be expected to have a Material Adverse Effect.

(e)   There  are no  material  actions,  suits or  claims  pending  against  an
      Employee  Plan  (other  than  routine  claims for  benefits),  or (to the
      knowledge  of the Company,  any US Group  Member or any ERISA  Affiliate)
      threatened,   which   might   reasonably   be  expected  to  be  asserted
      successfully against any Employee Plan.

(f)   Each US Group  Member  and any  ERISA  Affiliate  has  made all  material
      contributions  to or under each such Employee Plan required by law within
      the  applicable  time  limits  prescribed  by law,  by the  terms of such
      Employee Plan, or by any contract or agreement requiring contributions to
      an Employee Plan.

(g)   Neither any US Group Member nor any ERISA Affiliate has ceased operations
      at a  facility  so as to become  subject  to the  provisions  of  section
      4068(a) of ERISA,  withdrawn  as a  substantial  employer so as to become
      subject  to the  provisions  of  section  4063 of ERISA or ceased  making
      contributions to any Employee Plan subject to section 4064(a) of ERISA to
      which it made contributions.

(h)   Neither  any US Group  Member nor any ERISA  Affiliate  has  incurred  or
      reasonably expects to incur any material liability to PBGC.

20.33 MARGIN STOCK

(a)   No US Group  Member is engaged  principally,  or as one of its  important
      activities, in the business of owning or extending credit for the purpose
      of purchasing or carrying any Margin Stock.

(b)   The Facilities will not be used, directly or indirectly,  for any purpose
      which  might  constitute  all or any part of the  Facilities  a  "purpose
      credit" within the meaning of Regulation U or Regulation X.

(c)   No US Group  Member or any agent  acting on its  behalf has taken or will
      take any action  which might cause the Finance  Documents  to violate any
      regulation of the Board of Governors of the Federal Reserve System of the
      United States.

20.34 INVESTMENT COMPANIES

      No Group Member is subject to regulation under the United  States  Public
      Utility  Holding  Company  Act  of  1935  or the United States Investment
      Company  Act of 1940 or any United States federal  or  state  statute  or
      regulation limiting its ability to incur indebtedness.

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20.35 INSURANCES

(a)   The insurance  arrangements  required  by Clause 23.11 (Insurance) are in
      full force and effect as required by this Agreement.

(b)   No event or circumstance has occurred, and  there  has been no failure to
      disclose a material fact, which would (to the best of  its  knowledge and
      belief)  entitle any insurer to reduce or avoid its liability  under  any
      such insurance arrangements.

20.36 AUDITORS

      The Company's  appointed  auditors  and the auditors for each Obligor are
      one of the internationally recognized  "big  four" firm of accountants or
      BDO.

20.37 TIME FOR MAKING REPRESENTATIONS AND WARRANTIES

(a)   The representations and warranties set out in this Clause 20 are made:

      (i)    in the case of an Obligor which is a Party on the Signing Date, by
             that  Obligor  on that  date,  the date of the  first  Utilisation
             Request under this Agreement and the first Utilisation Date; and

      (ii)   in the case of an Obligor  which becomes a Party after the Signing
             Date, by that Obligor on the day on which it becomes an Additional
             Obligor.

(b)   The Repeating Representations are deemed to be made by  each  Obligor  to
      each  Finance  Party  by  reference  to the facts and circumstances  then
      existing on each of the following days or dates:

      (i)    the  date of  each  Utilisation  Request,  the  first  day of each
             Interest  Period and on each Quarter Date  throughout  the Term of
             any Letter of Credit; and

      (ii)   the day on  which  a  company  becomes  or it is  proposed  that a
             company becomes an Additional Obligor.

21.   INFORMATION UNDERTAKINGS

      The undertakings  in this Clause 21 remain in force from the Signing Date
      for so long as any  amount  is outstanding under the Finance Documents or
      any Commitment is in force.

21.1  FINANCIAL STATEMENTS

      The Company shall supply to the  Facility  Agent in sufficient copies for
      all the Lenders:

      (a)    as soon as the same become available,  but in any event within one
             hundred  and  twenty  (120) days after the  end  of  each  of  its
             financial years:

             (i)   its  audited  consolidated   and   unconsolidated  financial
                   statements for that financial year; and

             (ii)  at  the  request  of  the  Facility  Agent,   the  financial
                   statements of each Obligor (audited where audited  financial
                   statements are available) for that financial year;

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<PAGE>

             each  comprised  of  its respective balance sheet, profit and loss
             account and cash flow statement; and

      (b)    as soon as the same become  available,  but  in  any  event within
             fifty (50) days after the end of each Financial Quarter in each of
             its   financial   years,   its  unaudited  consolidated  financial
             statements (in a form satisfactory to the Facility Agent) for that
             Financial Quarter comprised  of its balance sheet, profit and loss
             account and cash flow statement,  together  with  a description of
             the business, market and financial developments of the Company and
             each business segment.

21.2  COMPLIANCE CERTIFICATE

(a)  The Company shall supply to the Facility Agent,  with each set of financial
     statements  delivered  pursuant  to  Clause  21.1(a)(i)  or (b)  (Financial
     Statements),  a Compliance  Certificate setting out (in reasonable detail),
     in each case as at the date to which those financial  statements were drawn
     up:

      (i)    computations   as  to   compliance   with  Clause  22   (Financial
             Covenants);

      (ii)   (in the  case of a  Compliance  Certificate  accompanying  audited
             financial statements) computations:

             (A)   establishing the amount of Excess Cash Flow (if any) for the
                   purpose  of  Clause  9.5  (Mandatory Prepayments from Excess
                   Cash Flow), together with a  calculation  of how that amount
                   has been determined; and

             (B)   establishing   calculations  with  respect  to  any   Margin
                   adjustments  for   the   purpose   of  Clause  10.2  (Margin
                   Ratchets);

      (iii)  in  the  case  of  the  annual  audited   consolidated   financial
             statements  by the Company's  auditors,  a  confirmation  that the
             Minimum  Guarantor  Coverage  (as defined in Clause 22.5  (Minimum
             Guarantor  Coverage))  has  been met as per the  relevant  balance
             sheet date; and

      (iv)   (in the case of a Compliance  Certificate  accompanying  unaudited
             quarterly financial  statements)  computations with respect to any
             margin   adjustments  for  the  purpose  of  Clause  10.2  (Margin
             Ratchets) and a list of all Material Subsidiaries.

(b)   The Company shall ensure that each Compliance Certificate shall be signed
      by two directors of the Company and, if required to be delivered with the
      financial  statements  delivered  pursuant to Clause  21.1(a)(i),  by the
      auditors that certified such statements.

21.3 REQUIREMENTS AS TO FINANCIAL STATEMENTS

(a)   Each set of financial  statements  delivered  by the Company  pursuant to
      Clause   21.1(a)  shall  be  audited  and  certified   without   material
      qualification  by  an  internationally  recognised  firm  of  independent
      auditors approved by the Facility Agent.

(b)   Each set of financial  statements  delivered  by the Company  pursuant to
      Clause 21.1  (Financial  Statements)  shall be certified by two directors
      or,  as the case  may be,  two  members  of the  management  board of the
      Company  or  relevant  Obligor  as  fairly   representing  its  financial
      condition  and  operations  as at the  date as at which  those  financial
      statements were drawn up.

                                       82

<PAGE>


(c)   Each set of financial  statements  delivered  by the Company  pursuant to
      Clause 21.1(b) shall be in such form as the Facility Agent may reasonably
      require and shall  include a comparison  of actual  performance  with the
      performance  projected  by the  relevant  Budget  for the period to which
      those  financial  statements  relate,  as well as a  comparison  with the
      preceding year, and shall provide  management  commentary  explaining any
      differences  in  such  performance  and  any  material   developments  or
      proposals affecting the Group or its business.

(d)   The Company will ensure that each set of financial  statements  delivered
      by it pursuant to Clause 21.1  (Financial  Statements)  is prepared using
      the  IFRS  and  accounting  practices  and  financial  reference  periods
      consistent  with those applied in the  preparation  of the Base Financial
      Statements  unless,  in relation to any set of financial  statements,  it
      notifies  the Facility  Agent that such  financial  statements  have been
      prepared  on a  different  basis as a result  of a change  in  accounting
      principles and its auditors (being an internationally  recognised firm of
      independent auditors approved by the Facility Agent) and shall deliver to
      the Facility Agent:

      (i)   a   description   of  any  change  necessary  for  those  financial
            statements to reflect  the IFRS, accounting practices and reference
            periods upon which the Base Financial Statements were prepared; and

      (ii)  sufficient information,  in form and substance as may be reasonably
            required by the Facility Agent,  to enable the Lenders to determine
            whether Clause 22 (Financial Covenants)  has been complied with and
            to establish any of the other matters referred  to  in  Clause 21.2
            (Compliance Certificate) and to make an accurate comparison between
            the financial position indicated in those financial statements  and
            the Base Financial Statements.

      Any  reference  in  this Agreement to those financial statements shall be
      construed as a reference  to  those  financial  statements as adjusted to
      reflect the basis upon which the Base Financial Statements were prepared.

(e)   If the Company notifies the Facility Agent of a change in accordance with
      paragraph (d) above then the Company and Facility  Agent shall enter into
      negotiations in good faith with a view to agreeing:

      (i)   whether or not  the  change might result in any material alteration
            in the commercial effect of any of the terms of this Agreement; and

      (ii)  if so, any amendments  to  this Agreement which may be necessary to
            ensure that the change does  not  result in any material alteration
            in the commercial effect of those terms,  and if any amendments are
            agreed they shall take effect and be binding on each of the Parties
            in accordance with their terms.

21.4  BUDGETS

(a)   The Company shall, as soon as the same becomes available and in any event
      no later than three (3) months after the  commencement  of each financial
      year of the Group, deliver to the Facility Agent in sufficient copies for
      the  Lenders a budget  (the  "BUDGET")  for that  financial  year and the
      following three (3) financial years (together, the "FINANCIAL YEARS UNDER
      REVIEW") (in a form and showing such detailed information as the Facility
      Agent may  reasonably  require)  prepared by reference to each  Financial
      Quarter and including:

                                       83

<PAGE>


      (i)   forecasts of any projected disposals (including timing  and  amount
            of  any  projected  disposals) on a consolidated basis of the Group
            for each Financial Year under Review;

      (ii)  projected profit and  loss  accounts  (including projected turnover
            and operating costs), broken down in respect  of  operating  profit
            before   depreciation   and   amortisation  in  different  business
            units/divisions,  and  projected   balance  sheets  and  cash  flow
            statements, together with the main operating  assumptions  relating
            to  such projected financial statements, on a quarterly basis,  for
            each  Financial  Year  under Review on a consolidated basis for the
            Group;

      (iii) revisions to the projections  set  out in the Budget and actuals of
            the preceding year, together with the  main  operating  assumptions
            relating  thereto,  for each Financial Year under Review, based  on
            the financial condition  and performance and prospects of the Group
            at such time;

      (iv)  projected Capital Expenditure  as defined in Clause 22.1 (Financial
            Definitions) to be incurred on a  Financial  Quarter  basis for the
            Financial Years under Review on a consolidated basis for the Group;
            and

      (v)   projected  Consolidated  EBITDA  as  at  the  end of each Financial
            Quarter.

(b)   The Company shall provide the Facility Agent with details of any material
      changes in the  projections  delivered  under this Clause 21.4 as soon as
      reasonably practicable after it becomes aware of any such change.

21.5  INFORMATION: MISCELLANEOUS

(a)   The Company shall supply to the Facility Agent (in sufficient  copies for
      all the Lenders, if the Facility Agent so requests):

      (i)   all  material  documents  dispatched  by  any Group Member  to  its
            shareholders  (or  any  class of them) or by the  Company  and  its
            Material Subsidiaries to  its  creditors  (or  any  class  of them)
            generally at the same time as they are dispatched;

      (ii)  promptly   upon   becoming  aware  of  them,  the  details  of  any
            litigation, arbitration  or  administrative  proceedings  which are
            current,  threatened or pending against any Group Member and  which
            might, if adversely  determined, have a Material Adverse Effect and
            any details of any litigation  or  administrative proceedings which
            are current, or any material litigation  or material administrative
            proceedings which are threatened or pending,  regarding competition
            law  proceedings  and  related civil lawsuits, including,  for  the
            avoidance of doubt, any  fines  which  have been assessed by way of
            any   administrative  proceedings  by  any  Government   Authority,
            including   details   regarding   the   Existing   Competition  Law
            Proceedings as identified in Schedule 15 (Existing Competition  Law
            Proceedings and Anti-Trust Lawsuits);

      (iii) in  relation to each Financial Quarter, a status report relating to
            the Existing  Competition  Law  Proceedings signed by the Company's
            in-house legal counsel;

      (iv)  promptly upon becoming aware of them,  the  details  of  any labour
            dispute  which is current, threatened or pending against any  Group
            Member and  which  might, if adversely determined, have, whether in
            respect of that Group  Member  or  the  Group  taken  as a whole, a
            Material Adverse Effect;

                                      84

<PAGE>


      (v)   promptly upon becoming aware of them, the details of any rating or,
            following  the  issuance  of  any  such  rating,  any change in  an
            Obligor's credit rating by Moody's Investor Services,  Inc.  or  by
            Standard and Poor's Corporation;

      (vi)  promptly  upon  becoming aware of them, the details of any proposed
            acquisition(s) (as  defined  below), to the extent such details are
            not   subject  to  the  terms  of  a   reasonable   confidentiality
            undertaking, in  excess of [e]2,500,000  per  annum, including, but
            not limited to:

            (A)    the  provision   of  the  target  company's  audited  annual
                   financial statements;

            (B)    due  diligence reports  prepared  in  connection  with  such
                   acquisition(s); and

            (C)    pro forma projections for the Group after the acquisition of
                   the target company,

            and "acquisitions"  for the purposes of this paragraph shall be any
            investment or acquisition  of  any  share  or  any  interest in the
            capital  of  any  person,  the  investment  or acquisition  of  any
            business or going concern or the whole or substantially  the  whole
            of  any  assets  or  business  of  any  person  (or any assets that
            constitute  a  division  or operation unit of the business  of  any
            person);

      (vii) promptly upon becoming aware  of  them, the details on any material
            change  with  regard  to lines of credit  exceeding  in  each  case
            [e]1,000,000 granted by banks  and/or financial institutions  other
            than the Senior Lenders in relation to the Senior Facilities;

      (viii)details  of  any change in the corporate ownership structure of the
            Group from that set out in the Group Structure Chart;

      (ix)  at each Quarter  Date  a  cash  flow  analysis, signed by the chief
            financial  officer  of  the Company in relation  to  the  preceding
            Financial Quarter;

      (x)   promptly,  and, in any event,  prior  to  the  date  on  which  any
            Subsidiary  becomes   a  Borrower  or  a  Guarantor,  such  further
            information  regarding  the   financial   condition,  business  and
            operations of any Group Member as any Lender  (through the Facility
            Agent) may reasonably request;

      (xi)  any  communication  received  by  it in respect of  any  actual  or
            alleged breach of or liability under  Environmental  Law  which, if
            substantiated  might  have  a Material Adverse Effect or result  in
            liabilities of and/or expenditure  by, one or more Group Members in
            excess  of [e]5,000,000 (or its equivalent  in  another currency or
            currencies) in aggregate;

      (xii) promptly  upon  becoming aware of them, the details of any claim(s)
            and/or potential  claim(s) for an amount in excess of [e]10,000,000
            (or its equivalent in another currency  or currencies) in aggregate
            made  by  or  on  behalf of any Group Member  under  any  insurance
            policy; and

      (xiii)promptly upon becoming  aware  of  them,  the  details of any Group
            Member which becomes or ceases to be a Dormant Company.

                                       85

<PAGE>


(b)   The Company shall ensure that, upon receipt of reasonable notice,  senior
      management is available once a year for the purpose of a meeting with the
      Lenders,  the  Facility  Agent and the  Documentation  Agent in  relation
      thereto.

21.6  NOTIFICATION OF DEFAULT

(a)   Each  Obligor  shall  notify the  Facility  Agent of any Default (and the
      steps,  if any, being taken to remedy it) promptly upon becoming aware of
      its  occurrence  (unless  that Obligor is aware that a  notification  has
      already been provided by another Obligor).

(b)   Promptly upon a request by the Facility  Agent,  the Company shall supply
      to the Facility  Agent a  certificate  signed by two of its  directors or
      senior  officers on its behalf  certifying  that no Default is continuing
      (or if a Default is continuing,  specifying the Default and the steps, if
      any, being taken to remedy it).

21.7  ERISA REPORTING REQUIREMENTS

(a)   The  Company  shall  procure  that each US Group  Member  and each  ERISA
      Affiliate (each a "RELEVANT COMPANY") shall:

       (i)    promptly  and  in any event within thirty  (30)  days  after  any
              Relevant Company knows or has reason to know that any ERISA Event
              which would reasonably  be  expected  to  have a Material Adverse
              Effect has occurred; and

       (ii)   promptly and in any event within ten (10) days after any Relevant
              Company knows or has reason to know that a  request for a minimum
              funding waiver under section 412 of the Code  has been filed with
              respect to any Title IV Plan or Multiemployer Plan,

       deliver to the Facility Agent a written statement of the chief financial
       officer of the Company describing such ERISA Event or waiver request and
       the action, if any, that it proposes to take with respect  thereto and a
       copy of any notice filed with the PBGC or the IRS pertaining thereto.

(b)   The  Company   shall   procure   that  each   Relevant   Company   shall,
      simultaneously  with the date that any Relevant Company files a notice of
      intent to terminate any Title IV Plan (if such termination  would require
      material  additional  contributions  in order to be considered a standard
      termination  within the meaning of section 4041(b) of ERISA),  deliver to
      the Facility Agent a copy of such notice.

21.8  INSPECTION OF BOOKS AND RECORDS

      Each Obligor shall (and the Company shall ensure that each  Group  Member
      will)  keep  books  and  records which accurately reflect in all material
      respects all of its business, affairs and transactions.

21.9  INVESTIGATIONS

(a)   If an Event of Default is  continuing  or the Majority Lenders reasonably
      believe,  after  consultation  with  the  Company,   that  any  financial
      statement,  certificate or calculation provided under this  Agreement  is
      inaccurate or  incomplete  in  any  material  respect, the Facility Agent
      (acting on the instructions of the Majority Lenders) may:

                                       86

<PAGE>


      (i)    instruct (or require the Company to instruct)  the auditors of the
             Company (or such other internationally recognised big four firm of
             accountants  as  the  Facility  Agent selects) to investigate  the
             affairs, financial performance or  accounting  and other reporting
             procedures and standards of the Group; or

      (ii)   instigate  such  other  investigations and commission  such  other
             reports as the Facility Agent  (acting  on the instructions of the
             Majority Lenders) reasonably requires.

      The  reasonable  costs and expense of each such investigation  or  report
      shall be borne by the Company.

(b)   Each Obligor shall  (and  the  Company shall ensure that each other Group
      Member  will)  co-operate  fully  with   any   person   carrying  out  an
      investigation or preparing a report pursuant to paragraph (a) above.

22.   FINANCIAL COVENANTS

      The covenants in this Clause 22 remain in force from the Signing Date for
      so long as any amount is outstanding under the Finance Documents  or  any
      Commitment is in force.

22.1  FINANCIAL DEFINITIONS

(a)   In this Clause 22:

      "AMORTISATION  AND  OTHER  PAYMENTS"  means,  in  respect of any Relevant
      Period the aggregate of:

      (i)   all  repayments, prepayments and other payments  of  principal  and
            premium  paid  or  falling  due in respect of the Senior Facilities
            (but excluding any amounts paid  or falling due under the Revolving
            Credit Facility and capable of being  simultaneously re-drawn under
            the terms of this Agreement); and

      (ii)  all repayments, prepayments and other payments of principal paid or
            falling due in respect of any other Financial  Indebtedness  (other
            than  in  respect  of  Subordinated  Debt) of any Group Member (but
            excluding Intra Group Loans and any amounts  paid  or  falling  due
            under  any  overdraft  or  revolving credit facility and capable of
            being simultaneously re-drawn  under  the  terms  of  the  relevant
            facility); and

      (iii) the  amount  of cash dividends or distributions paid in respect  of
            that period.

      "APPROVED BANK" means any bank which is an authorised banking institution
      under applicable legislation and whose debt securities are rated at least
      A1 by Moody's Investor  Services,  Inc.  or  A+  by  Standard  and Poor's
      Corporation or as the Facility Agent may approve.

      "CAPITAL  EXPENDITURE"  means  any  capital  expenditure which should  in
      accordance  with  IFRS  or  the  Relevant  GAAP  be  treated  as  capital
      expenditure  in  the  audited  consolidated financial statements  of  the
      Group.

      "CASH" means:

      (i)   cash in hand;

                                       87

<PAGE>


      (ii)  any credit balance on any  current, savings or deposit account with
            any Approved Bank that is repayable on demand or upon not more than
            ninety (90) days' notice; and

      (iii) all cash held in the Cartel  Deposit  Account  and  Convert Deposit
            Account.

      "CASH EQUIVALENTS" means:

      (i)   debt  securities which are not convertible into any other  form  of
            security,  rated  or  issued  by  any  person rated A1 or better by
            Moody's  Investor  Services, Inc. or A+ or  better  by  Standard  &
            Poor's Corporation and  not  issued  or  guaranteed  by  any  Group
            Member;

      (ii)  certificates  of  deposit  issued  by,  and acceptances by, banking
            institutions authorised under applicable  legislation  which at the
            time  of  making  such issue or acceptances, have outstanding  debt
            securities rated as provided in paragraph (i) above;

      (iii) such other securities  (if  any) as are approved as such in writing
            by the Facility Agent (acting  on  the instructions of the Majority
            Lenders); and

      (iv)  which, in each case, have no more than  twelve (12) months to final
            maturity,  other  than moneys held in the Convert  Deposit  Account
            which may be held until the redemption of the Convertible Bonds.

      "CASH FLOW FROM INVESTING  ACTIVITIES"  has  the  meaning  given to it in
      IFRS.

      "CASH  FLOW  FROM OPERATING ACTIVITIES" has the meaning given  to  it  in
      IFRS.

      "CONSOLIDATED   EBITDA"   means,  in  respect  of  any  Relevant  Period,
      consolidated net pre-taxation  profits  of  the  Group  for such Relevant
      Period adjusted by, without duplication:

      (i)   adding back Net Interest Costs;

      (ii)  adding back any amount attributable to the depreciation of tangible
            assets or impairment of shareholdings;

      (iii) adding  back  any  amount  attributable to the amortisation  and/or
            impairment of goodwill, intellectual  property and other intangible
            assets;

      (iv)  adding back any amount attributable to  net  write-offs of tangible
            fixed assets, inventory and deferred tax assets  including, but not
            limited  to, as a consequence of impairment tests or  restructuring
            measures; and

      (v)   adding back any amount attributable to the provisions taken for the
            Competition  Law  Liabilities  and for any other future competition
            law related fines.

      "EXCESS CASH FLOW" means, in respect of  any financial year of the Group,
      consolidated Cash Flow from Operating Activities, adding back any amounts
      paid  in  respect  of the US Competition Law  Liabilities,  the  Canadian
      Competition Law Liabilities,  the  EU  Competition Law Liabilities to the
      extent  paid  from the Cartel Deposit Account,  and  any  civil  lawsuits
      settled in 2004 up to an amount of Euro 3,000,000, less:

      (i)    Acquisitions and Capital Expenditure for that financial year; and

                                       88

<PAGE>


      (ii)   Amortisation and Other Payments during that financial year.

      "INTEREST COVERAGE  RATIO"  means,  for any Relevant Period, the ratio of
      Consolidated EBITDA for such period to  Net  Interest  Expense  for  such
      period.

      "INTEREST  PAYABLE"  means,  in  respect  of  any  Relevant  Period,  the
      aggregate  amount  of interest (including the interest element of leasing
      and hire purchase payments),  expenses  (cash  or  non-cash), commission,
      fees, discounts and other finance charges of any nature  payable (whether
      or  not paid, payable or capitalised) by any Group Member (including  any
      commission,  fees,  discounts  and  other  finance charges payable by any
      Group  Member  under  any interest rate hedging  arrangement)  but  after
      deducting any commission,  fees,  discounts  and  other  finance  charges
      receivable   by   any  Group  Member  under  any  interest  rate  hedging
      arrangement, and deducting any fees and costs paid in connection with the
      transactions contemplated  by this Agreement, the US Term Loan Agreement,
      the Bridge Loan and the High Yield Notes.

      "LEVERAGE RATIO" means, for  any  Relevant Period, the ratio of Total Net
      Debt  on the last day of that period  to  Consolidated  EBITDA  for  that
      period.

      "NET INTEREST COSTS" means, for any Relevant Period, Interest Payable for
      such  period,   but  after  deducting  any  non-cash  interest,  interest
      receivable or accrued  during such period by any Group Member on any cash
      deposit or bank account or on any Cash Equivalents.

      "NET INTEREST EXPENSE" means Net Interest Costs less

      (i)   imputed or actual  interest  on  the US Department of Justice fines
            and  interest accrued or imputed interest  on  European  Commission
            fines;

      (ii)  interest on pension provisions; and

      (iii) amortisation of capitalised debt financing costs,

      in each case, accrued or recognized during such period.

      "NET WORTH"  means  the  shareholders'  equity,  including capital stock,
      additional paid-in capital (other than shares which  are  expressed to be
      redeemable), retained earnings and minority interest as reflected  in the
      relevant consolidated balance sheet of the Group, adjusted

      (i)    to  disregard  any capital  gains and losses from  disposals  made
             after 30 September 2003;

      (ii)   to disregard the impacts of the conversion of the relevant amounts
             in  respect  of any  non-German  Subsidiaries  from  the  original
             reporting currency into Euro;

      (iii)  to  disregard  impairments  and other  write-offs  in  respect  of
             goodwill and other intangible assets; and

      (iv)   to  disregard  movements  on deferred  tax assets  resulting  from
             extraordinary  items  to  the  extent  the  same  occur  after  30
             September 2003.

      For  the  purpose  of  this  definition,  adjustments  made  pursuant  to
      paragraph (ii) and  (iii) shall not exceed [e]60,000,000 in the aggregate
      over the lifetime of the Senior Facilities.

                                       89

<PAGE>


      "RELEVANT PERIOD" means  each  period of twelve (12) months ending on the
      last day of each of the Company's  financial  years and/or each period of
      twelve (12) months that corresponds with four (4)  consecutive  Financial
      Quarters  ending  on  the  Quarter Date on which the relevant calculation
      falls to be made.

      "SENIOR  NET  DEBT"  means Total  Net  Debt  less  the  aggregate  amount
      outstanding under the  High  Yield  Notes, the Exchange Notes, the Bridge
      Loan and all other Subordinated Debt.

      "SUBORDINATED  DEBT"  means  the  Financial  Indebtedness  of  the  Group
      subordinated pursuant to the Intercreditor Agreement to all amounts which
      may  be  or  become  payable to the Finance  Parties  under  the  Finance
      Documents.

      "TOTAL NET DEBT" means,  at  any  time  (but  so  that no amount shall be
      included or excluded more than once), the aggregate  indebtedness  of any
      Group   Members   constituting   Financial  Indebtedness  (but  excluding
      indebtedness of any Group Member to  another  Group  Member to the extent
      permitted under this Agreement) less Cash and Cash Equivalents, plus:

      (i)   the amount of receivables sold or securitised, but disregarding the
            amount  of receivables sold or securitized on a non-recourse  basis
            provided  the  proceeds  from  this disposal or securitisation have
            been applied in full for the prepayment  and  cancellation  of  the
            Revolving  Credit Facility in accordance with Clause 9.3 (Mandatory
            Prepayment from Asset Disposal); and

      (ii)  the aggregate  amount  of  fines  assessed  against  the Company in
            relation to any Competition Law Liabilities, any other  competition
            law related fines, civil proceedings and costs related to either of
            them, or, if greater:

            (A)    in relation to the fines imposed on the Company or any Group
                   Member  by the European Commission, the aggregate amount  of
                   such fines  plus  accrued  interest  thereon,  such interest
                   calculated  at  the  rate as set by the European Commission;
                   and

            (B)    in relation to the fines imposed on the Company or any Group
                   Member by the US Department  of Justice, the total amount of
                   all such fines together with all  other amounts arising from
                   hedging activities relating to those fines.

(b)   All  accounting  expressions  which  are not otherwise  defined  in  this
      Agreement shall be construed in accordance with IFRS.

22.2  NET WORTH

      Net Worth shall at all times throughout the term of the Facilities exceed
      [e] 325,000,000.

22.3  NET INTEREST COVER

      The  Company  must  ensure  that the Interest  Coverage  Ratio  for  each
      Relevant Period ending on each  Quarter  Date specified in Column A below
      shall equal or exceed the ratio set out opposite  such  Quarter  Date  in
      Column B below:

                                       90

<PAGE>


<TABLE>
<CAPTION>
          COLUMN A               COLUMN B
       (QUARTER DATE)            (RATIO)
      <S>                         <C>
      30 March 2004               2.00:1
      30 June 2004                2.00:1
      30 September 2004           2.25:1
      31 December 2004            2.45:1
      30 March 2005               2.55:1
      30 June 2005                2.65:1
      30 September 2005           2.75:1
      31 December 2005            2.85:1
      30 March 2006               3.00:1
      30 June 2006                3.15:1
      30 September 2006           3.30:1
      31 December 2006            3.45:1
      30 March 2007               3.50:1
      30 June 2007                3.60:1
      30 September 2007           3.65:1
      31 December 2007            3.75:1
      30 March 2008               3.90:1
      30 June 2008                4.00:1
      30 September 2008           4.20:1
      31 December 2008            4.35:1
</TABLE>


22.4  LEVERAGE RATIO

      The  Company must ensure that the Leverage Ratio for each Relevant Period
      ending  on  each  Quarter  Date  specified in Column A below shall not be
      greater than the ratio set out opposite  such  Quarter  Date  in Column B
      below:

                                       91

<PAGE>


<TABLE>
<CAPTION>
          COLUMN A               COLUMN B
       (QUARTER DATE)            (RATIO)
      <S>                          <C>
      31 March 2004               5.85:1
      30 June 2004                5.85:1
      30 September 2004           5.15:1
      31 December 2004            4.65:1
      31 March 2005               4.45:1
      30 June 2005                4.35:1
      30 September 2005           4.05:1
      31 December 2005            3.90:1
      31 March 2006               3.55:1
      30 June 2006                3.40:1
      30 September 2006           3.10:1
      31 December 2006            2.85:1
      31 March 2007               2.75:1
      31 June 2007                2.70:1
      30 September 2007           2.55:1
      31 December 2007            2.40:1
      31 March 2008               2.25:1
      30 June 2008                2.20:1
      30 September 2008           2.00:1
      and each Quarter Date thereafter
</TABLE>

22.5  MINIMUM GUARANTOR COVERAGE

      The Company must ensure that, the contribution to Consolidated EBITDA and
      turnover  of  the  Guarantors represent at all times at least eighty-five
      (85) per cent. of the  Consolidated EBITDA and turnover of the Group (the
      "MINIMUM GUARANTOR COVERAGE").

                                       92

<PAGE>


22.6  SENIOR NET DEBT TO CONSOLIDATED EBITDA

      The Company must ensure that the ratio of Senior Net Debt to Consolidated
      EBITDA for each Relevant  Period  ending  on  a Quarter Date specified in
      Column A below shall not be greater than the ratio  set out opposite such
      Quarter Date in Column B below:

<TABLE>
<CAPTION>
         COLUMN A                COLUMN B
      (QUARTER DATE)             (RATIO)
      <S>                          <C>
      30 March 2004               2.55:1
      30 June 2004                2.55:1
      30 September 2004           2.20:1
      31 December 2004            1.95:1
      30 March 2005               1.85:1
      30 June 2005                1.80:1
      30 September 2005           1.65:1
      31 December 2005            1.55:1
      30 March 2006               1.30:1
      30 June 2006                1.25:1
      30 September 2006           1.05:1
      31 December 2006            1.00:1
      and each Quarter Date thereafter
</TABLE>


22.7  FIXED CHARGE COVER RATIO

      The Company must ensure that the fixed charge cover ratio being:

      (A - B) + C
      -----------
         C + D

      where:

      A      is the Group's Cash Flow from Operating Activities  plus  any fees
             paid  in  relation  to  this  Agreement, the Bridge Loan, the High
             Yield  Notes, the Rights Issue and  the  Tender  Offer,  plus  any
             amounts paid in respect of the US Competition Law Liabilities, the
             Canadian  Competition  Law  Liabilities,  the  EU  Competition Law
             Liabilities  to  the extent paid from the Cartel Deposit  Account,
             and any civil lawsuits  settled  in  2004  up to an amount of Euro
             3,000,000;

      B      is the Group's Cash Flow from Investing Activities;

      C      is the Net Interest Expense; and

                                       93

<PAGE>


      D      is the Amortisation and Other Payments;

      in  each  case  for  each  Relevant  Period  ending  on  a  Quarter  Date
      (commencing on December 31, 2004), shall not be lower than 1.00 to 1.

22.8  MAXIMUM CAPITAL EXPENDITURE

      The  Company  must ensure that the aggregate Capital Expenditure  of  the
      Group in respect  of  each  financial  year  of  the Company specified in
      Column  A  below,  shall  not  exceed the amount set out  (opposite  that
      financial year) in Column B below.

<TABLE>
<CAPTION>
          COLUMN A                 COLUMN B
    (FINANCIAL YEAR DATE)(        AMOUNT [e])
      <S>                         <C>
      31 December 2004            53,000,000
      31 December 2005            55,000,000
      31 December 2006            54,600,000
      31 December 2007            53,600,000
      31 December 2008            53,600,000
</TABLE>

      If in any financial year (the "ORIGINAL  FINANCIAL  YEAR")  the amount of
      the Capital Expenditure is less than the maximum amount permitted for the
      Original  Financial Year (the difference being referred to below  as  the
      "UNUSED AMOUNT"), then the maximum expenditure amount set out in Column B
      above for the  immediately following financial year shall be increased by
      an amount (the "CARRY-FORWARD  AMOUNT") equal to the lesser of (i) 50 per
      cent. of the maximum amount permitted for the Original Financial Year and
      (ii) the Unused Amount.

22.9  CALCULATIONS

      All calculations made for the purposes of the financial covenants set out
      in Clause 22.3 (Net Interest Cover)  to  Clause 22.7  (Fixed Charge Cover
      Ratio)  (inclusive)  shall  be made by reference to, where  the  Relevant
      Period to which such covenant  relates  ends  on,  or the Quarter Date to
      which such covenant relates falls on:

      (a)    any  day  other  than the last day of any financial  year  of  the
             Company, the unaudited  consolidated  financial  statements of the
             Company for each of the four consecutive Financial Quarters within
             that  Relevant  Period  or,  as  the  case  may  be, the unaudited
             consolidated financial statements of the Company for the Financial
             Quarter  ending  on that Quarter Date, in each case  as  delivered
             pursuant to Clause 21 (Information Undertakings); and

      (b)    the last day of any financial year of the Company, as in paragraph
             (a)  above  or,  when   so  delivered,  the  audited  consolidated
             financial statements of the Company for that financial year.

                                       94

<PAGE>


22.10  FINANCIAL TESTING

(a)   Each of the financial covenants set out in this Clause 22 (other than the
      Minimum  Guarantor  Coverage) shall be tested by reference to each of the
      financial statements and each Compliance  Certificate  delivered pursuant
      to  Clause  21.1  (Financial  Statements)  and  Clause  21.2  (Compliance
      Certificate).

(b)   All  financial  covenants  set out in Clause 22.3 (Net  Interest  Cover),
      Clause  22.4   (Leverage   Ratio),   Clause  22.6  (Senior  Net  Debt  to
      Consolidated  EBITDA) and Clause 22.7 (Fixed Charge Cover Ratio) shall be
      tested against the Company's latest consolidated  financial statements on
      a four  Financial  Quarter  rolling  basis  and  adjusted  pro  forma for
      Permitted Acquisitions and Permitted Disposals assuming such transactions
      had occurred at the  beginning of the relevant  four-  Financial  Quarter
      period.  The Minimum  Guarantor  Coverage shall be tested on the basis of
      the Company's  consolidated financial statements as of 30 September 2003,
      and  subsequently  on the  basis of the  Company's  audited  consolidated
      financial statements as per year-end starting with 31 December 2004.

23.   GENERAL UNDERTAKINGS

      The undertakings in this Clause 23 remain in force from the  Signing Date
      for  so long as any amount is outstanding under the Finance Documents  or
      any Commitment is in force.

23.1  AUTHORISATIONS

(a)   Each  Obligor  shall (and the Company  shall ensure that each other Group
      Member will) promptly:

      (i)   obtain,  comply  with  and  do all that is necessary to maintain in
            full force and effect; and

      (ii)  supply certified copies to the Facility Agent of,

      any  Authorisation  required  under  any   law   or   regulation  of  its
      jurisdiction  of  incorporation  to enable it to perform its  obligations
      under  the  Finance  Documents  and to  ensure  the  legality,  validity,
      enforceability  or  admissibility in  evidence  in  its  jurisdiction  of
      incorporation of any Finance Document.

(b)   Each  Obligor  shall (and the Company  shall ensure that each other Group
      Member will):

      (i)   ensure that it  has  the right and is duly qualified to conduct its
            business as it is conducted  from  time  to  time in all applicable
            jurisdictions;

      (ii)  obtain,  comply with and do all that is necessary  to  maintain  in
            full force  and effect any Authorisation which is necessary for the
            conduct of its  business  or  the business of the Group as a whole;
            and

      (iii) upon the Facility Agent's written request supply the Facility Agent
            with copies of any such Authorisations.

23.2  COMPLIANCE WITH LAWS

      Each Obligor shall (and the Company shall  ensure  that  each other Group
      Member  will)  comply in all respects with all laws to which  it  may  be
      subject, if failure  so  to comply

                                       95

<PAGE>


      would materially impair its ability to perform its obligations under  the
      Finance Documents to which it is a party.

23.3  NEGATIVE PLEDGE

(a)   No Obligor shall (and the Company shall ensure that no other Group Member
      will) create or permit to subsist any Security over any of its assets.

(b)   No Obligor shall (and the Company shall ensure that no other Group Member
      will):

      (i)   sell, transfer or otherwise dispose of any of its  assets  on terms
            whereby  they  are  or may be leased to or re-acquired by any Group
            Member;

      (ii)  sell, transfer or otherwise  dispose  of  any of its receivables on
            recourse terms;

      (iii) enter into any arrangement under which money  or  the  benefit of a
            bank or other account may be applied, set-off or made subject  to a
            combination of accounts; or

      (iv)  enter  into  any  other  preferential  arrangement having a similar
            effect,

            in each case, in circumstances where the arrangement or transaction
            is  entered  into  primarily  as  a  method  of  raising  Financial
            Indebtedness or of financing the acquisition of an asset.

(c)   Paragraphs (a) and (b) above do not apply to Permitted Security.

(d)   No Obligor shall (and the Company shall ensure that no other Group Member
      will) agree to create or permit to subsist  any covenant in any document,
      other than the Finance Documents, the Bridge  Loan,  the  Exchange  Notes
      Indenture,  the  High Yield Notes and the Convertible Bonds, that it will
      not create or permit to subsist any Security over its assets.

23.4  DISPOSALS

(a)   Other than pursuant to the  Management and Employee  Benefit  Plans,  the
      Hitco  Options,  any Permitted  Joint Venture and the  conversion  rights
      under the  Convertible  Bonds,  no Obligor  shall (and the Company  shall
      ensure that no other Group Member  will) enter into a single  transaction
      or a  series  of  transactions  (whether  related  or  not)  and  whether
      voluntary or involuntary to sell, lease, transfer or otherwise dispose of
      any shares in any Group  Member,  unless  such sale,  lease,  transfer or
      disposal  of  shares  is made to an  Obligor  and  the  Company  provides
      evidence  satisfactory to the Security Agent (including a confirmation of
      the relevant  Obligor's  external legal counsel addressed to such Obligor
      and  expressed  to be made  available  to, and to be relied  upon by, the
      Security Agent on behalf of the Lenders),  that the Security created over
      such shares in favour of the Secured Parties is not impaired thereby.

(b)   No Obligor shall (and the Company shall ensure that no other Group Member
      will)  enter  into a  single  transaction  or a  series  of  transactions
      (whether  related or not) and whether  voluntary or  involuntary to sell,
      lease, transfer or otherwise dispose of all or any part of its respective
      assets (other than shares referred to in paragraph (a) above).

(c)   Paragraph (b) above does not apply to any Permitted Disposal.

                                       96

<PAGE>


23.5  OPTIONS

      Other than pursuant  to  the  Management  and Employee Benefit Plans, the
      Hitco Options and the conversion rights under  the  Convertible Bonds, no
      Obligor  shall (and the Company shall ensure that no other  Group  Member
      will) enter  into  or  permit  to subsist any option or other arrangement
      whereby any person has the right  (whether  or  not exercisable only on a
      contingency) to require any Group Member to purchase or otherwise acquire
      or sell or otherwise dispose of any material property  or any interest in
      any  material  property  otherwise  than  where  any such arrangement  is
      permitted by Clause 23.27 (Treasury Transactions).

23.6  CHANGE OF BUSINESS

      No Obligor shall (and the Company shall ensure that no other Group Member
      will)  make,  or take any steps to make, any substantial  change  to  the
      general nature  of  its business from that carried on at the Signing Date
      or carry on any other business which results in any substantial change to
      the general nature of  the  business  of  the  Group as a whole from that
      carried on at the Signing Date.

23.7  YEAR END

      Commencing  1  January 2004, each Obligor shall (and  the  Company  shall
      ensure that each  other  Group  Member  will)  ensure  that  each  of its
      financial years and each Financial Quarter in each of its financial years
      shall  end  on  a  Quarter  Date  and  the Company shall ensure that each
      financial year, and each Financial Quarter of each financial year, of the
      Group shall end on a Quarter Date.

23.8  RECORD KEEPING

      Upon reasonable notice being given by the  Facility Agent to the relevant
      Obligor, that Obligor shall (and the Company shall ensure that each other
      Group  Member  will) permit the Facility Agent  and/or  any  professional
      advisers appointed  by  the  Facility  Agent  to  examine  during  normal
      business  hours  the records and books of account of such Obligor and  to
      discuss financial  matters with its officers and auditors or those of any
      other Group Member for  the  purpose  of ascertaining compliance with the
      Finance Documents, with the reasonable  costs  thereof  to be paid by the
      Company.

23.9  CONSTITUTIONAL DOCUMENTS

      No Obligor shall request, permit or make any change to its constitutional
      documents without written notification to the Facility Agent  where  such
      change  relates  to  the shareholders, the share capital, the management,
      the registered office or the legal form of such Obligor.

23.10 PRESERVATION OF ASSETS

      Each Obligor shall (and  the  Company  shall ensure that each other Group
      Member will) maintain and preserve all of  its  assets that are necessary
      in  the  conduct  of  its  business in good working order  and  condition
      (ordinary wear and tear excepted).

                                       97

<PAGE>


23.11 INSURANCE

(a)   Each  Obligor  shall (and the Company  shall ensure that each other Group
      Member  will)  maintain  insurance on and in relation to its business and
      assets with reputable  underwriters or insurance  companies  against such
      risks and to such extent as is usual for prudent companies  carrying on a
      business  such as that  carried on by such Obligor or Group Member in the
      country or countries in which such Obligor or Group Member owns or leases
      property or conducts its business.

(b)   Without limiting paragraph (a) above, each Obligor shall (and the Company
      shall  ensure  that each other  Group  Member  will)  maintain  insurance
      against  business  interruption   (Betriebsunterbrechung),   professional
      indemnity (i.e. directors' and officers' liability insurance), pollution,
      public   liability,   product   liability   and  third  party   liability
      (Haftplicht) in each case at levels no lower than those in place prior to
      Closing.

(c)   Each  Obligor  shall (and the Company  shall ensure that each other Group
      Member will) pay all  premiums and do all other things  necessary to keep
      in  place  the  insurance   arrangements  required  to  be  effected  and
      maintained by it pursuant to paragraphs (a) and (b) above.

(d)   The Company shall supply the Facility  Agent on  reasonable  request with
      copies of each receipt for all premiums and other amounts  payable by any
      Obligor or other Group Member under the insurance  arrangements  effected
      and  maintained by any of them  pursuant to paragraphs  (a) and (b) above
      and shall,  in any event,  use all reasonable  endeavours to procure that
      the insurer in respect of such insurance  arrangements  undertakes to the
      Facility  Agent to notify it should any  renewal fee or other sum payable
      by any Obligor or other Group Member not be paid when due.

(e)   Upon reasonable request, the Company shall supply the Facility Agent with
      a copy of all insurance policies or certificates of insurance  evidencing
      compliance  with  paragraphs  (a) and (b) above or (in the absence of the
      same) such other evidence of the existence of any insurance  arrangements
      referred  to in  paragraphs  (a)  and  (b)  above  as may  be  reasonably
      acceptable  to the  Facility  Agent and shall,  in any event,  notify the
      Facility Agent of any material changes to any such insurance arrangements
      made from time to time.

(f)   If any Obligor (or any other Group Member) fails  to purchase or maintain
      any insurance required by this Clause, the Facility Agent or the Security
      Agent may purchase such insurance as may be necessary  to remedy any such
      failure  and each Obligor shall (and the Company shall ensure  that  each
      other Group Member will) indemnify the Facility Agent or, as the case may
      be, the Security Agent on demand against any reasonable costs or expenses
      incurred by it in purchasing any such insurance.

(g)   No Obligor shall (and the Company shall ensure that no other Group Member
      will) do or omit to do anything which might render any insurance required
      by this Clause void, voidable or unenforceable.

23.12 INTELLECTUAL PROPERTY

      Each Obligor  shall  (and  the Company shall ensure that each other Group
      Member will):

      (a)    make such registrations and pay such fees and other amounts as are
             necessary to keep those  registered  Intellectual  Property Rights
             which are necessary for carrying on the business of the Group as a
             whole  in force, and to record its interest in those  Intellectual
             Property Rights;

                                       98

<PAGE>


      (b)    observe and comply with all material obligations and laws to which
             it in its  capacity  as  registered  proprietor, beneficial owner,
             user, licensor or licensee of the Intellectual Property Rights (or
             any  part  thereof)  is  subject  where failure  to  do  so  might
             reasonably be expected to have a Material Adverse Effect;

      (c)    do  all  acts  as  are  reasonably  practicable   (including   the
             institution   of  legal  proceedings)  to  maintain,  protect  and
             safeguard the Intellectual  Property necessary for carrying on the
             business of the Group as a whole; and

      (d)    not terminate or discontinue  the use of any Intellectual Property
             necessary for carrying on the business  of  the  Group,  save that
             licensing  arrangements  in relation to such Intellectual Property
             may be entered into between  any  Group Members PROVIDED THAT such
             licensing arrangements:

             (i)   do not allow any further sub-licensing by the licensee; and

             (ii)  do not have a material adverse effect on the value of any of
                   the Intellectual Property licensed under such sub-license.

23.13 ENVIRONMENTAL COMPLIANCE

      Each Obligor shall (and the Company shall  ensure  that  each other Group
      Member will) obtain and maintain all requisite Environmental Licences and
      comply with:

      (a)    all applicable Environmental Laws; and

      (b)    the terms and conditions of all Environmental Licences  applicable
             to it,

      and take all reasonable steps in anticipation of known or expected future
      changes  to or obligations under the same, in each case where failure  to
      do so would  or  might  reasonably be expected to have a Material Adverse
      Effect.

23.14 ENVIRONMENTAL CLAIMS

      The Company shall inform  the  Facility  Agent  in  writing  as  soon  as
      reasonably practicable upon its becoming aware of:

      (a)    any  Environmental  Claim  which  has been commenced or threatened
             against any Group Member, or

      (b)    any facts or circumstances which will  or are reasonably likely to
             result in any Environmental Claim being  commenced  or  threatened
             against any Group Member,

      where   the  claim  might,  if  determined  against  that  Group  Member,
      reasonably be expected to have a Material Adverse Effect.

23.15 PENSION SCHEMES

(a)   The Company will, if reasonably  requested by the Facility Agent, deliver
      to the Facility Agent:

      (i)   at such time as those reports are prepared in order  to comply with
            then current statutory or auditing requirements (if any); and

                                       99

<PAGE>


      (ii)  if  the  Facility  Agent  reasonably  believes  that  any  relevant
            statutory or auditing requirements are not being complied with,

      actuarial  reports  in  relation  to  the pension schemes operated by any
      Group Members.

(b)   Each Obligor  shall (and the Company  shall procure that each other Group
      Member will) ensure that all pension  schemes  applicable to it are fully
      provided for (either by way of being funded or by way of provision in its
      balance  sheet) based on reasonable  actuarial  assumptions to the extent
      required by applicable law and are  administered and funded in accordance
      with applicable law.

23.16 TAXATION

(a)   Each  Obligor  shall (and the Company  shall ensure that each other Group
      Member will) pay and  discharge  all Taxes  imposed upon it or its assets
      within the time period allowed without incurring  penalties,  save to the
      extent that:

      (i)   payment is being contested in good faith and in accordance with the
            relevant procedures;

      (ii)  adequate  reserves  are  being  maintained   for   those  Taxes  in
            accordance with Relevant GAAP; and

      (iii) payment  can  be  lawfully  withheld  and  will not result  in  the
            imposition  of  any material penalty nor in any  material  Security
            ranking in priority  to  the  claims of any Finance Party under any
            Finance  Document or to any Security  created  under  any  Security
            Document.

(b)   No Obligor shall (and the Company shall ensure that no other Group Member
      will) be materially overdue in the filing of any Tax returns.

(c)   Each  Obligor  shall (and the Company  shall ensure that each other Group
      Member will) do all such things as are necessary to ensure that no claims
      are or are reasonably likely to be asserted against any Group Member with
      respect to Taxes  which might  reasonably  be expected to have a Material
      Adverse Effect.

23.17 SECURITY

(a)   Each Obligor shall ensure that any Security expressed to be created by it
      by or pursuant to, or, as the case may be, expressed to have been created
      by it and to be evidenced in, any Security Document remains in full force
      and effect with the ranking and priority it is expressed to have.

(b)   No Obligor shall (and the Company shall ensure that no other Group Member
      will) do or omit to do anything or knowingly  permit or cause anything to
      be done or omitted to be done which would or could  adversely  affect any
      Security expressed to be created by any Obligor by or pursuant to, or any
      Security  expressed  to  have  been  created  by  any  Obligor  and to be
      evidenced in, any Security Document.

(c)   Each Obligor  shall take all such  actions as the  Facility  Agent or the
      Security Agent may  reasonably  request for the purpose of perfecting any
      Security granted or to be granted  pursuant to the Finance  Documents and
      preserving  the  Security  to be  created  or  evidenced  by the  Finance
      Documents.

                                       100

<PAGE>


(d)   Each Obligor shall,  if the Security  Agent lawfully  exercises any power
      (whether of sale or other disposal or otherwise) or right with respect to
      the Charged Assets, do all reasonable acts to permit the exercise of such
      power or right.

(e)   Each Obligor shall satisfy the conditions  subsequent set out in Part III
      of Schedule 2 (Conditions Precedent and Conditions Subsequent) as soon as
      possible after the Closing Date, but in any event not later than 31 March
      2004.

23.18 PARI PASSU RANKING

      Without  limiting  Clause 23.17(a)  (Security), each Obligor  shall  (and
      shall  cause  each  other  Group  Member  to)  ensure  that  its  payment
      obligations under the Finance Documents will  rank  at  least  pari passu
      with the claims of all its unsecured and unsubordinated creditors  except
      for  obligations  mandatorily  preferred  by  law  applying  to companies
      generally.

23.19 SHARE CAPITAL

      No Obligor shall (and the Company shall ensure that no other Group Member
      will):

      (a)    redeem, purchase, return or make any repayment in respect  of  any
             of  its  share  capital  or make any capital distribution or enter
             into any agreement to do so; or

      (b)    allot  or issue any shares  or  grant  to  any  person  the  right
             (whether  conditional  or  otherwise)  to  call  for  the issue or
             allotment  of any share, partnership interest, loan note  or  loan
             capital of such Obligor or other Group Member (including an option
             or  a right of  pre-emption  or  conversion)  or  enter  into  any
             agreement  or  pass  any  corporate  resolution  to  do any of the
             foregoing other than:

             (i)   for  the  purposes of an issue of shares by one wholly-owned
                   Subsidiary of the Company to another wholly-owned Subsidiary
                   of the Company  provided that Security is, in respect to the
                   Shares of an Obligor,  created over such shares in favour of
                   the Secured Parties; or

             (ii)  for the purposes of an issue  of  shares by the Company to a
                   person who acts or is to act as the  trustee  of  any  Group
                   pension  scheme  or  employee or management incentive scheme
                   PROVIDED THAT such scheme  has  been  approved in writing by
                   the  Facility  Agent  such approval not to  be  unreasonably
                   withheld.

23.20 DIVIDENDS AND OTHER DISTRIBUTIONS

      As long as the Leverage Ratio is greater than 1.00 to 1:

      (a)    the  Company  to the extent permissible  under  German  law,  will
             recommend not to  make  and  not  to propose to make any dividend,
             return  on capital, repayment of capital  contributions  or  other
             distribution (whether in cash or kind) or make any distribution of
             assets or  other  payment  whatsoever  in respect of share capital
             whether directly or indirectly; and

      (b)    the  Company will refrain from making any  share  buy-backs  other
             than as provided for in the Management and Employee Benefit Plans.

                                       101

<PAGE>


23.21 INTRA-GROUP DEBT AND SUBORDINATED DEBT

      No Obligor shall (and the Company shall ensure that no other Group Member
      will):

      (i)   pay, repay,  prepay,  redeem,  purchase,  or  otherwise  retire the
            principal amount of any indebtedness;

      (ii)  pay  any  interest or return on principal or repayment of principal
            or other distribution  (whether in cash or kind) but excluding, for
            the avoidance of doubt,  the capitalization of interest and payment
            in kind, or PIK interest,  or  make  any  distribution of assets or
            other payments whatsoever in respect of any indebtedness; or

      (iii) set  apart  any  sum  for  a  foresaid  purpose, including  without
            limitation by depositing any moneys in a  defeasance  trust  or the
            taking of any similar action,

      in each case which indebtedness (A) is subordinated or junior in right of
      payment  to  the  obligations  under  the Senior Facilities pursuant to a
      written agreement to that effect (other  than,  in the case of this para.
      (A), regular scheduled payments of interest or other  amounts as and when
      due,   to   the   extent   not  prohibited  by  applicable  subordination
      provisions), or (B) under any  Intra-Group  Loan  Document  with  a Group
      Member which is not an Obligor. Without affecting the ranking of the High
      Yield Notes, this Clause 23.21 shall apply thereto as if they were within
      the classes of indebtedness covered hereby.

23.22 CASH FLOW RESTRICTIONS

      The  Company  shall  ensure  that,  other than the Finance Documents, the
      Bridge Loan and the High Yield Notes,  no Group Member will be a party to
      any contractual or similar arrangement pursuant to which any Group Member
      is   prohibited  from  making  any  payments  of   dividends   or   other
      distributions, or from lending monies, to another Group Member.

23.23 MERGER

      With the  exception  of  Permitted  Mergers,  no  Obligor  shall (and the
      Company  shall  ensure  that no other Group Member will) enter  into  any
      amalgamation, demerger, merger  or corporate reconstruction which results
      in assets being transferred from  it  to an entity that is not an Obligor
      unless the Facility Agent (acting on the  instructions  of  the  Majority
      Lenders) shall have given its prior written consent thereto, such consent
      not to be unreasonably withheld.

23.24 INDEBTEDNESS

      No Obligor shall (and the Company shall ensure that no other Group Member
      will) incur, create or permit to subsist or have outstanding:

      (a)    any Financial Indebtedness other than Permitted Indebtedness; or

      (b)    any  other  indebtedness  except,  in  the  ordinary course of its
             business.

                                       102

<PAGE>


23.25 LOANS OUT

      (a)    No Obligor shall (and the Company shall ensure that no other Group
             Member will) make any loans, grant any credit or provide any other
             financial  accommodation  to or for  the  benefit  of any  person,
             including any of its shareholders.

      (b)    Paragraph (a) shall not apply to Permitted Loans.

23.26 GUARANTEES OR CONTINGENT LIABILITIES

      (a)    No Obligor shall (and the Company shall ensure that no other Group
             Member will):
             (i)   give any guarantee or indemnity to or for the benefit of any
                   person   or  otherwise  voluntarily  assume  any  liability,
                   whether actual  or  contingent, in respect of any obligation
                   of any person; or

             (ii)  be  or  become  directly   or   indirectly  or  actually  or
                   contingently  liable  for  any  loss,   damage   or  expense
                   resulting  from  the non-payment or breach of any obligation
                   of any other person.

      (b)    Paragraph  (a)  shall  not apply to any  Permitted  Guarantees  or
             Contingent Liabilities.

23.27 TREASURY TRANSACTIONS

      No Obligor shall (and the Company shall ensure that no other Group Member
      will) enter into any Treasury Transaction except for:

      (a)    Treasury Transactions entered into in accordance with Clause 23.28
             (Hedging); and

      (b)    any  other  foreign  exchange transactions  for  spot  or  forward
             delivery entered into  in the ordinary course of business (and not
             for  investment  or  speculative  purposes)  to  hedge  actual  or
             projected  interest  rate,   currency  value  or  commodity  price
             exposures incurred by any Group  Member  in the ordinary course of
             business.

23.28 HEDGING

      Each Borrower shall (and the Company shall ensure  that  each other Group
      Member  will)  within 180 days of the date of this Agreement  enter  into
      and/or maintain Hedging Agreements:

      (i)    so as to ensure that for a period of not less than three (3) years
             commencing  on the Signing Date, the Group has hedging of interest
             rate exposure  in respect of not less than fifty (50) per cent. of
             the aggregate amounts  outstanding  from  time  to  time under the
             Loans, the US Term Loan, the Bridge Loan and the High Yield Notes;
             and

      (ii)   which rank pari passu with the claims of the Finance Parties under
             the Finance Documents.

23.29 ACQUISITIONS

      No Obligor shall (and the Company shall ensure that no other Group Member
      will) engage in any Acquisitions other than Permitted Acquisitions  or as
      otherwise permitted by Clause 23.30 (Joint Ventures).

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23.30 JOINT VENTURES

(a)   No Obligor shall (and the Company shall ensure that no other Group Member
      will):

      (i)    form, or enter into, or permit to subsist;

      (ii)   purchase,  subscribe for or otherwise acquire any shares (or other
             securities or any interest therein) in; or

      (iii)  transfer any  assets to, or lend to, or guarantee or give security
             for the obligations of,

      any partnership, consortium,  Joint  Venture or other like arrangement or
      agree to do any of the foregoing.

(b)   Paragraphs (a) shall not apply to:

      (i)    any  partnership,  consortium,  Joint   Venture   or   other  like
             arrangement existing at the Signing Date;

      (ii)    any Permitted Loans;

      (iii)   and Permitted Joint Ventures; and

      (iv)  any Permitted Guarantees and Contingent Liabilities;

23.31 MANDATORY CASH COLLATERAL

      Until  the  Expiry  Date,  the  Company shall provide (i) on each Quarter
      Date, and (ii) on each Utilisation Date in respect of any proposed Letter
      of Credit, Mandatory Cash Collateral  in  an  amount  equal  to  the Term
      Facility B Excess Exposure calculated as of such date. The Company  shall
      provide on each Quarter Date together with each Compliance Certificate to
      be  delivered  pursuant  to  Clause 21.2 (a) (iv) and on each Utilisation
      Date in respect of any proposed  Letter  of Credit, a confirmation signed
      by  two  directors of the Company that the Company  is  not  required  to
      provide Mandatory  Cash  Collateral  in  accordance  with  the  preceding
      sentence, together with a calculation setting out (in reasonable  detail)
      the  computations  as  to compliance with the requirements of this Clause
      23.31 (b).

23.32 AMENDMENTS TO FINANCE AND OTHER DOCUMENTS

      Neither the Company nor any Obligor shall amend, vary, novate, supplement
      or  terminate  any  Finance  Documents  (other  than  the  US  Term  Loan
      Agreement), any Subordinated  Finance  Document or any document delivered
      to the Facility Agent pursuant to Clause 4 (Conditions of Utilisation) or
      Clause  26  (Changes to the Obligors), or  waive  any  right  thereunder,
      except for:

      (i)    any of the foregoing which is expressly consented to in writing by
             the Facility  Agent  (acting  on  the instructions of the Majority
             Lenders); or

      (ii)   any  amendment,  variation  or waiver  which  is  of  a  minor  or
             technical nature.

23.33 COMPLIANCE WITH ERISA

      The  Company shall procure that each  US  Group  Member  and  each  ERISA
      Affiliate  shall not cause or permit to occur either an event which would
      result in the  imposition  of

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      Security  under section 412 of the Code or section 302  or  section  4068
      of ERISA or an  ERISA  Event that  might reasonably be expected to have a
      Material Adverse Effect.

23.34 FEDERAL RESERVE REGULATIONS

      The Company shall procure that  each  US  Group  Member  and  each  ERISA
      Affiliate will use the Facilities without violating Regulations T, U  and
      X.

23.35 MATERIAL ADVERSE EFFECT

      No Obligor shall (and the Company shall ensure that no other Group Member
      will) enter into any agreement or obligation:

      (i)    which is reasonably likely to have a Material Adverse Effect; or

      (ii)   the performance of which would result in a breach of any provision
             of any Finance Document by any Obligor.

23.36 ADDITIONAL GUARANTORS

      The  Company  shall  procure that any Subsidiary (other than HITCO Carbon
      Composites Inc.) which  qualifies  as  a  Material  Subsidiary becomes an
      Additional  Guarantor  no later than ninety (90) days after  the  Signing
      Date or, if such Subsidiary only qualifies as a Material Subsidiary after
      such date, after the relevant  audited  financial  statements  are  to be
      delivered in accordance with Clause 21.1 (Financial Statements) paragraph
      (a)  (i),  that  the  shares  in  such Material Subsidiary are pledged or
      assigned and that the assets of such  Material  Subsidiary are pledged or
      assigned  in  favour  of  the  Finance  Parties  in accordance  with  the
      applicable laws. However, should any Obligor acquire  shares  in a target
      company  which  will qualify as a Material Subsidiary, the above  applies
      mutatis mutandis within ninety (90) days of the date of such acquisition.

23.37 [INTENTIONALLY LEFT BLANK]

23.38 GERMAN OBLIGORS

      The provisions of  Clause  23.4  (Disposals)  to  Clause 23.7 (Year End),
      Clause  23.9  (Constitutional  Documents),  Clause  23.12   (Intellectual
      Property),   Clause  23.22  (Cash  Flow  Restrictions)  to  Clause  23.27
      (Treasury Transactions),  Clause 23.29  (Acquisitions)  and  Clause 23.30
      (Joint Ventures) (the "RELEVANT RESTRICTIVE COVENANTS") shall  not  apply
      to  any  Obligor  whose  Relevant Jurisdiction is Germany (each a "GERMAN
      OBLIGOR") or any of its Subsidiaries  from  time  to  time whose Relevant
      Jurisdiction  is  Germany (together with such German Obligor,  a  "GERMAN
      GROUP").

23.39 NOTIFICATION BY A GERMAN OBLIGOR

      Each German Obligor  undertakes  to  inform the Facility Agent in writing
      and in good time of the intention of it  or  of  any member of its German
      Group to carry out any of the acts or take any of  the  steps referred to
      in  the Relevant Restrictive Covenants explaining if and how  such  steps
      might  affect the financial situation of the Company or the Group, or the
      Finance  Parties' risk and security position. Any such notification shall
      not be made  later than forty-five (45) days before such measure shall be
      implemented, or  in case of urgent matters requiring an implementation on
      shorter notice immediately after the need for the relevant measure arises
      PROVIDED THAT the reasons for such urgent implementation are

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      described  in the  notification.  The  Facility  Agent  shall be entitled
      within ten (10) Business Days of receipt of the relevant German Obligor's
      notice to request the relevant  German  Obligor and the Company to supply
      to the  Facility  Agent in  sufficient  copies  for the  Finance  Parties
      further  relevant  information in connection  with the proposed action or
      steps referred to in such notice.  If any  notification  pursuant to this
      Clause  23.39  is  received  by the  Facility  Agent,  the  Lenders  will
      determine  within twenty (20) Business Days after receipt of the relevant
      notification, on a case by case basis, whether the proposed measure would
      constitute an Event of Default if implemented.

23.40 NON-GERMAN ACCOUNTS

      Each German  Obligor  undertakes  to  provide  the  Facility Agent within
      fifteen  (15)  Business  Days  after each Quarter Date with  (i)  a  list
      identifying all such bank accounts  held  outside  Germany and evidencing
      the balances of such accounts as at of the relevant Quarter Date together
      with (ii) written confirmation by the relevant German  Obligor  or by the
      Company,  respectively, that the relevant balances at no time exceed  the
      maximum amount of [e]500,000 and [e]2,000,000, as the case may be, in the
      aggregate of all such non-German bank accounts of all German Obligors.

23.41 TENDER OFFER

      The Company shall:

      (a)    commence  a  tender  offer  for the  Convertible  Bonds as soon as
             practicable after the Company's  extraordinary general meeting and
             in any event no later than three (3) days after the  Closing  Date
             (the "TENDER OFFER");

      (b)    on or prior to the  Closing  Date,  irrevocably  deposit  into the
             Convert Deposit Account an amount sufficient to fund principal and
             interest (through maturity) of the Convertible Bond;

      (c)    from the  submitting of the tender  documents to Bafin until close
             of the  tender  of the  Convertible  Bond not make or  permit  any
             amendment to the terms and conditions of the tender offer; and

      (d)    ensure that the principal and related interest  amounts  deposited
             in the Convert Deposit Account in respect of any Convertible Bonds
             not tendered shall remain in the Convert Deposit Account and shall
             further pay into the Convert Deposit Account an additional  amount
             equal to the present value of the remaining interest obligation in
             respect of such Convertible Bonds.

23.42 ARM'S LENGTH TERMS

      No Obligor shall (and the Company shall ensure that no other Group Member
      will) enter into  any  contract or arrangement with or for the benefit of
      any other person (including  any  disposal  to that person) other than in
      the ordinary course of business and on arm's length terms.

23.43 DORMANT COMPANIES

      The Company shall ensure that:

      (a)    no Group Member shall, while it is a Dormant Company:

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<PAGE>

             (i)   carry on any business or incur any liability; or

             (ii)  demand or accept payment of any  indebtedness owing to it by
                   any other Group Member; and

      (b)    no Group Member shall pay any indebtedness  owing  to  any Dormant
             Company.

24.   EVENTS OF DEFAULT

      Each of the events or circumstances set out in this Clause 24 is an Event
      of Default.

24.1  NON-PAYMENT

      An Obligor does not pay on the due date any amount payable pursuant  to a
      Finance  Document  at  the  place  at  and in the currency in which it is
      expressed to be payable, including payment  of  Mandatory Cash Collateral
      by the Company, unless:

      (i)    its failure to pay is caused by administrative or technical error;
             and

      (ii)   payment is made within two (2) Business Days of its due date.

24.2  FINANCIAL COVENANTS

      Any requirement of Clause 22 (Financial Covenants) is not satisfied.

24.3  OTHER OBLIGATIONS

      (a)    An  Obligor  does not  comply  with a  material  provision  of the
             Finance  Documents  (other  than those  referred to in Clause 24.1
             (Non-Payment)  and Clause 24.2 (Financial  Covenants)) or does not
             comply  with  any  provision  of the  Finance  Documents  which is
             capable of remedy and fails to remedy such  breach  within a grace
             period  specified by the Facility  Agent of not more than ten (10)
             Business  Days or, in case of a failure  by an  Obligor  to comply
             with  a   notification   requirement   pursuant  to  Clause  23.39
             (Notification  by a German  Obligor),  does not promptly  upon the
             Facility Agent's request comply with its obligations thereunder.

      (b)    An Obligor  implements a measure  requiring prior  notification of
             the Facility  Agent  pursuant to Clause 23.39  (Notification  by a
             German  Obligor)  after having been informed by the Facility Agent
             that the Lenders consider  implementation  of the relevant measure
             as having material adverse consequences for their risk or security
             position, or implements such measure prior to the earlier to occur
             of (i)  approval  by the  Lenders of such  measure and (ii) twenty
             (20)  Business  Days after having  notified the Facility  Agent in
             accordance with Clause 23.39 (Notification by a German Obligor).

24.4  MISREPRESENTATION

      Any representation or statement  made  or deemed to be made by an Obligor
      in the Finance Documents or any other document  delivered by or on behalf
      of  any Obligor under or in connection with any Finance  Document  is  or
      proves  to have been incorrect or misleading in any material respect when
      made or deemed to be made and which has or is reasonably likely to have a
      Material Adverse Effect.

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<PAGE>


24.5  CROSS DEFAULT

      (a)    Any  Financial  Indebtedness  of any Group Member is not paid when
             due and payable nor within any originally applicable grace period.

      (b)    Any Financial  Indebtedness  of any Group Member is declared to be
             or  otherwise  becomes  due and  payable  prior  to its  specified
             maturity as a result of an event of default (however described).

      (c)    Any commitment for any Financial  Indebtedness of any Group Member
             is  cancelled  or suspended by a creditor of any Group Member as a
             result of an event of default (however described).

      (d)    Any creditor of any Group Member  becomes  entitled to declare any
             Financial  Indebtedness  of any Group Member due and payable prior
             to its  specified  maturity  as a result  of an  event of  default
             (however described).

      (e)    No Event of Default  will  occur  under  this  Clause  24.5 if the
             aggregate  amount of  Financial  Indebtedness  or  commitment  for
             Financial  Indebtedness falling within paragraphs (a) to (d) above
             is less than [e]2,500,000 (or its equivalent in any other currency
             or currencies).

24.6  INSOLVENCY

(a)   A Group Member located in an OECD country or a Material  Subsidiary (each
      a "RELEVANT  COMPANY") is unable or admits  inability to pay its debts as
      they fall due, suspends making payments on any of its debts or, by reason
      of actual or anticipated financial  difficulties,  commences negotiations
      with one or more of its creditors with a view to rescheduling  any of its
      indebtedness.  In particular, any Relevant Company incorporated under the
      laws of Germany (a "GERMAN RELEVANT  COMPANY") is unable to pay its debts
      as  they   fall   due   (Zahlungsunfahigkeit)   or   is   over   indebted
      (uberschuldet),   commences   negotiations  with  any one  or more of its
      creditors with a view to the general  readjustment or rescheduling of its
      indebtedness  or  makes a  general  assignment  for the  benefit  of or a
      composition  with its  creditors  or, for any of the  reasons  set out in
      Sections  17-19  of the  German  Insolvenzordnung,  any  German  Relevant
      Company     files    for   insolvency   (Antrag   auf   Eroffnung   eines
      Insolvenzverfahrens)  or   the   board  of  directors  (Geschaftsfuhrung)
      of any German Relevant  Company is required by law to file for insolvency
      or the competent  court takes any of the actions set out in Section 21 of
      the German  Insolvenzordnung or institutes insolvency proceedings against
      any German  Relevant  Company (Eroffnung  des Insolvenzverfahrens) or any
      event occurs with respect to any other Relevant Company which,  under the
      laws of any  jurisdiction  to  which  it is  subject  or in  which it has
      assets, has a similar or analogous effect.

(b)   Any event or proceedings  are taken with respect to any Relevant  Company
      that has a similar  effect to any of the  provisions set out in paragraph
      (a) above.

(c)   A moratorium is declared in respect of any  indebtedness  of any Relevant
      Company.

24.7  INSOLVENCY PROCEEDINGS

      Any corporate action, legal proceedings or other  procedure  or  step  is
      taken in relation to:

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      (i)    the  suspension  of  payments,  a  moratorium of any indebtedness,
             winding-up, dissolution, administration  or reorganisation (by way
             of voluntary arrangement, scheme of arrangement  or  otherwise) of
             any   Relevant  Company  other  than  a  solvent  liquidation   or
             reorganisation of any Relevant Company which is not an Obligor;

      (ii)   a composition,  assignment or arrangement with any creditor of any
             Relevant Company;

      (iii)  the appointment of  a  liquidator  (other  than  in  respect  of a
             solvent  liquidation  of  a  Relevant  Company  which  is  not  an
             Obligor),   receiver,  administrator,  provisional  administrator,
             administrative  receiver,  compulsory  manager  or  other  similar
             officer  in  respect of any Relevant Company or any of its assets;
             or

      (iv)   enforcement of  any  Security  over  any  material  assets  of any
             Relevant Company,

      or  any  analogous procedure or step is taken in any jurisdiction, unless
      such corporate  action,  legal proceedings or analogous procedure or step
      is fully discontinued within fourteen (14) days of its commencement.

24.8  CREDITORS' PROCESS

      Any attachment, sequestration, distress or execution affects any asset or
      assets of a Relevant Company  having  an  aggregate value of [e]1,500,000
      and is not discharged within fourteen (14) days.

24.9  OWNERSHIP OF THE OBLIGORS

      Except in relation to a sale of  shares  in HITCO CARBON COMPOSITES, Inc.
      under  an  existing  call  option with its chief  executive  officer,  an
      Obligor (other than the Company)  is  not  or ceases to be a wholly-owned
      Subsidiary of the Company on or after the Closing Date.

24.10 FINANCE DOCUMENTS

      If:

      (i)    it is or becomes unlawful for an Obligor  to  perform  any  of its
             obligations under the Finance Documents;

      (ii)   an Obligor repudiates a Finance Document or evidences an intention
             to repudiate a Finance Document; or

      (iii)  any  Finance  Document  is  not  or  ceases  to  be  binding on or
             enforceable against an Obligor,

      and the risk or security position of the Lenders is materially  adversely
      affected thereby.

24.11 TRANSACTION SECURITY

      If:

      (i)    any Transaction Security is not in full force and effect with  the
             ranking and priority it is expressed to have;

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      (ii)   an Obligor repudiates any of the Transaction Security or evidences
             an intention to repudiate any of the Transaction Security; or

      (iii)  a  notification  is  made to the Facility Agent pursuant to Clause
             19.9 (b),

      and the security or risk position  of  the Lender is materially adversely
      affected thereby.

24.12 CESSATION OF BUSINESS

      Any Obligor suspends or ceases to carry on all or any substantial part of
      its business or proposes to do so.

24.13 AUDITORS' QUALIFICATION

      The Company's auditors qualify their report  on  the audited consolidated
      financial statements of the Group in any manner that  is,  in the opinion
      of  the Majority Lenders (acting reasonably), materially adverse  in  the
      context of the Finance Documents and the transactions contemplated by the
      Finance Documents.

24.14 MATERIAL ADVERSE CHANGE OR EFFECT

      Any event  or  circumstance  occurs which the Majority Lenders reasonably
      believe has had or could have  a  Material Adverse Effect or, following a
      notification pursuant to Clause 23.39 (Notification by a German Obligor),
      the  Majority  Lenders reasonably believe  has  or  could  have  material
      adverse consequences for the Lenders' risk and security position.

24.15 GUARANTOR ACCESSION

      Any of the Material  Subsidiaries  has not become an Additional Guarantor
      on or before the date falling ninety  (90) days after the respective date
      referred to in Clause 23.36 (Additional Guarantors).

24.16 COMPULSORY ACQUISITION

      All  or any part of the assets of any Group  Member  having  a  value  in
      excess   of   [e]5,000,000  are  seized,  nationalised,  expropriated  or
      compulsorily acquired by, or by the order of, any Government Agency where
      such seizure, nationalisation, expropriation  or  compulsory  acquisition
      might have a Material Adverse Effect.

24.17 CHANGE OF CONTROL

      There is a Change of Control.

24.18 PROCEEDINGS

(a)   Any litigation, arbitration, labour dispute or administrative proceedings
      of  or  before  any  court,  arbitral  body  or  agency  (other  than the
      proceedings  referred  to  in  paragraph  (b)  below) which, if adversely
      determined, could, in the reasonable opinion of  the Majority Lenders, be
      expected  to  have  a  Material  Adverse  Effect  is  or are  started  in
      accordance   with  the  applicable  procedural  rules  in  the   relevant
      jurisdiction or threatened against any Group Member.

(b)   Other than the  Existing Competition Law Proceedings, any competition law
      related (i) civil  litigation,  civil lawsuits or other civil proceedings
      of or before any court are started  in

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      accordance  with  the  applicable   procedural   rules  in  any  relevant
      jurisdiction  against any Group Member  which,  if adversely  determined,
      could, in the reasonable opinion of the Majority Lenders,  be expected to
      have a  Material  Adverse  Effect;  (ii)  fines in the  aggregate  amount
      exceeding   [e]2,500,000  are  assessed  by  way  of  any  administrative
      proceedings by any Government  Agency;  or (iii) fines in relation to the
      Existing Competition Law Proceedings are subsequently increased.

      However, before  accelerating  the  Facilities  pursuant  to Clause 24.22
      (Acceleration),  the parties will enter into negotiations in  good  faith
      for a period not exceeding  thirty  (30) days after the occurrence of any
      of the events set out in sub-para. (i),  (ii)  or  (iii)  with  a view to
      continue the Loans as outstanding.

24.19 UNLAWFULNESS

      It is or becomes unlawful for any person (other than a Finance Party)  to
      perform any of its obligations under the Finance Documents.

24.20 REPUDIATION

      Any  person  (other  than a Finance Party or a Hedging Bank) repudiates a
      Finance  Document  or evidences  an  intention  to  repudiate  a  Finance
      Document.

24.21 INTERCREDITOR AGREEMENT

      (i)    Any Party (other  than  a  Finance Party) fails to comply with its
             obligations under the Intercreditor Agreement.

      (ii)   Any  warranty  made  by  any Group  Member  in  the  Intercreditor
             Agreement is incorrect in any material respect when made.

      (iii)  The Intercreditor Agreement  is  not or ceases to be binding on or
             enforceable against any party thereto  or  shall  otherwise not be
             effective by reason of any act or omission by any Group  Member or
             any other party thereto.

24.22 ACCELERATION

      On and at any time after the occurrence of an Event of Default, which  is
      continuing  the  Facility  Agent  may,  and  shall  if so directed by the
      Majority Lenders, by notice to the Company:

      (i)    cancel the Total Commitments whereupon they shall  immediately  be
             cancelled;

      (ii)   declare  that  all  or  part  of  the Loans, together with accrued
             interest,  and  all  other  amounts  accrued   under  the  Finance
             Documents  be  immediately due and payable, whereupon  they  shall
             become immediately due and payable;

      (iii)  declare that all  or  part  of  the  Loans  be  payable on demand,
             whereupon they shall immediately become payable on  demand  by the
             Facility Agent on the instructions of the Majority Lenders;

      (iv)   require  the Borrowers to procure that the liabilities of each  of
             the Lenders  are promptly reduced to zero, whereupon the Borrowers
             will do so;

      (v)    more specifically, require the Company to:

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      (vi)   procure that the liabilities of each of the Issuing Banks under or
             in connection  with  any  Letter of Credit are promptly reduced to
             zero; or

      (vii)  provide Cash Collateral for  any  Letter of Credit in Euros and in
             an amount specified by the Facility Agent,

             whereupon the Company will do so;

      (viii) require the Borrowers to repay or pay  all  outstandings under the
             Subfacilities, whereupon the Borrowers will do so; and/or

      (ix)   exercise, or direct the Security Agent to exercise,  all or any of
             its or, as the case may be, the Security Agent's rights, remedies,
             powers or discretions under any of the Finance Documents.

24.23 US OBLIGORS

      Notwithstanding  Clause 24.22 (Acceleration), upon the actual  or  deemed
      entry of an order for relief under the US Bankruptcy Code with respect to
      any US Obligor, the  Facilities  shall  cease  to be available to such US
      Obligor,  all  Loans  outstanding  to  such  US  Obligor   shall   become
      immediately  due  and  payable  and  such US Obligor shall be required to
      provide cash cover in respect of the Letters  of  Credit  issued  for its
      account in each case automatically and without any further action by  any
      party to this Agreement.

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                                  SECTION 9

                              CHANGES TO PARTIES

25.   CHANGES TO THE LENDERS

25.1  ASSIGNMENTS AND TRANSFERS BY THE LENDERS

(a)   Subject to this Clause 25, a Lender (the  "EXISTING  LENDER")  may assign
      and  transfer  or  pledge,  as the case  may be,  any of its  rights  and
      obligations under this Agreement to another bank, financial  institution,
      trust,  fund,  special purpose vehicle or other entity (the "NEW LENDER")
      PROVIDED THAT in respect of the Revolving Credit Facility,  such Existing
      Lender  may not  assign  and  transfer  to a New  Lender  its  rights and
      obligations in relation thereto without the prior consent of the Facility
      Agent, such consent not to be unreasonably withheld or delayed.

(b)   Notwithstanding  the  subsequent  provisions of this Clause,  an Existing
      Lender may assign or  pledge,  as the case may be, any claims  under this
      Agreement  to any third  party for  refinancing  purposes.  The  Existing
      Lender shall in case of any such  assignments  remain  responsible in all
      respects  for the  administration  of the claims so  assigned,  and shall
      ensure  that all  information  relating to the  Obligors  and the Finance
      Documents  made available to any such assignee is subject at all times to
      a strict confidentiality obligation, and that the Obligors will following
      such assignment be in no less  advantageous a position,  in terms of cost
      and other potentially detrimental effects, than before such assignment.

25.2  CONDITIONS OF ASSIGNMENT AND TRANSFER

      (a)    The  consent  of  neither  the  Company  nor any other  Obligor is
             required for an assignment and transfer by a Lender.

      (b)    An  assignment   and  transfer  of  a  Lender's   Commitment   and
             participation in outstanding  Loans must be in a minimum amount of
             [e]1,000,000 or any higher amount which is an integral multiple of
             [e]500,000   unless   all  of   such   Lender's   Commitment   and
             participation in outstanding Loans are assigned or transferred.

      (c)    If a Lender wishes to enter into an assignment and transfer of its
             Term Facility B Commitment and Term Facility B  Outstandings,  the
             consent of the Issuing  Banks to the extent such Issuing Banks are
             not also Term Facility B Lenders will be required.

      (d)    An  assignment  and transfer  will only be effective on receipt by
             the Facility Agent of written confirmation from the New Lender (in
             form and substance  satisfactory  to the Facility  Agent) that the
             New Lender will assume the same  obligations  to the other Finance
             Parties as it would have been under if it was an Original Lender.

      (e)    A transfer  will only be  effective  if the  procedure  set out in
             Clause 25.5 (Procedure for Transfer) is complied with.

      (f)    If:

             (i)    a  Lender   assigns  and   transfers  any  of  its  rights,
                    obligations  or  claims  under  the  Finance  Documents  or
                    changes its Facility Office; and

             (ii)   as a  result  of  circumstances  existing  at the  date the
                    assignment,  transfer or change occurs, an Obligor would be
                    obliged  to make a  payment  to the New  Lender  or

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                    Lender acting  through its new Facility Office under Clause
                    14 (Tax  Gross-up  and Indemnities) or Clause 15 (Increased
                    Costs),

      then  the  New Lender or Lender acting through its new Facility Office is
      only entitled  to  receive payment under those Clauses to the same extent
      as the Existing Lender  or  Lender  acting  through its previous Facility
      Office  would have been if the assignment, transfer  or  change  had  not
      occurred.

25.3  ASSIGNMENT AND TRANSFER FEE

      Other than  in  relation  to  an  assignment  and  transfer  under Clause
      25.1(b),  the New Lender shall, on the date upon which an assignment  and
      transfer takes  effect, pay to the Facility Agent (for its own account) a
      fee of [e]1,500.

25.4  LIMITATION OF RESPONSIBILITY OF EXISTING LENDERS

(a)   Unless  expressly  agreed to the  contrary,  an Existing  Lender makes no
      representation  or warranty and assumes no responsibility to a New Lender
      for:

      (i)    the  legality, validity, effectiveness, adequacy or enforceability
             of the Finance Documents or any other documents;

      (ii)   the financial condition of any Obligor;

      (iii)  the performance  and  observance by any Obligor of its obligations
             under the Finance Documents or any other documents; or

      (iv)   the accuracy of any statements  (whether  written or oral) made in
             or in connection with any Finance Document or any other document,

      and any representations or warranties implied by law are excluded.

(b)   Each New Lender confirms to the Existing Lender  and  the  other  Finance
      Parties that it:

      (i)    has  made  (and  shall  continue  to  make)  its  own  independent
             investigation  and  assessment  of  the  financial  condition  and
             affairs  of  each  Obligor  and its related entities in connection
             with  its  participation in this  Agreement  and  has  not  relied
             exclusively  on  any  information  provided  to it by the Existing
             Lender in connection with any Finance Document; and

      (ii)   will  continue  to  make  its  own  independent appraisal  of  the
             creditworthiness of each Obligor and  its  related entities whilst
             any amount is or may be outstanding under the Finance Documents or
             any Commitment is in force.

(c)   Nothing in any Finance Document obliges an Existing Lender to:

      (i)    accept  a  re-transfer  from a New Lender of any  of  the  rights,
             obligations  and  claims  assigned   or   transferred  under  this
             Clause 25; or

      (ii)   support  any  losses directly or indirectly incurred  by  the  New
             Lender by reason  of  the  non-performance  by  any Obligor of its
             obligations under the Finance Documents or otherwise.

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25.5  PROCEDURE FOR TRANSFER

(a)   Subject   to  the  conditions  set  out in  Clause  25.2  (Conditions  of
      Assignment  and  Transfer)  an  assignment  and  transfer  is effected in
      accordance  with  paragraph (b) below when the Facility Agent executes an
      otherwise  duly  completed  Transfer  Certificate  delivered to it by the
      Existing Lender and the New Lender.  The Facility Agent shall, as soon as
      reasonably  practicable after receipt by it of a duly completed  Transfer
      Certificate  appearing  on its  face to  comply  with  the  terms of this
      Agreement and delivered in accordance  with the terms of this  Agreement,
      execute that Transfer Certificate.

(b)   On the Transfer Date:

      (i)    each of the Obligors and the New Lender  shall  assume obligations
             towards  one another and/or acquire rights or claims  against  one
             another which differ from the rights, obligations and claims among
             the Obligors  and the Existing Lender only insofar as that Obligor
             and the New Lender  have assumed and/or acquired the same in place
             of that Obligor and the Existing Lender;

      (ii)   the  Facility  Agent,  the   Security  Agent,  the  Mandated  Lead
             Arrangers, the New Lender, the  other  Lenders  and  any  relevant
             Issuing Banks shall acquire the same rights and claims and  assume
             the  same  obligations  between  themselves  as  they  would  have
             acquired  and  assumed  had the New Lender been an Original Lender
             with the rights, claims and/or  obligations acquired or assumed by
             it as a result of the transfer and  to  that  extent  the Facility
             Agent,  the  Security  Agent,  the  Mandated  Lead Arrangers,  any
             relevant  Issuing  Banks  and the Existing Lender  shall  each  be
             released  from  further  obligations  to  each  other  under  this
             Agreement; and

      (iii)  the New Lender shall become a Party as a "LENDER".

25.6  DISCLOSURE OF INFORMATION

      Any Lender may disclose to:

      (i)    any of its Affiliates and any of its or their respective officers,
             employees, Agents, professional advisers or auditors; and

      (ii)   any other person:

      (iii)  to (or through) whom that  Lender  assigns  and  transfers (or may
             potentially  assign  and  transfer)  all  or  any  of its  rights,
             obligations and/or claims under this Agreement;

      (iv)   with (or through) whom that Lender enters into (or may potentially
             enter  into)  any sub-participation in relation to, or  any  other
             transaction under  which  payments are to be made by reference to,
             this Agreement or any Obligor; or

      (v)    to whom, and to the extent  that,  information  is  required to be
             disclosed by any applicable law or regulation,

      (vi)   any  information  about  any  Obligor,  the Group and the  Finance
             Documents  as  that  Lender  shall  consider  appropriate  if,  in
             relation to paragraphs (i) and (ii) above, the  person to whom the
             information  is  to  be  given  has entered into a Confidentiality
             Undertaking.

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25.7  ANCILLARY PROVISIONS

      Each  Obligor  shall  execute  and  do all such  transfers,  assignments,
      assurances, acts and things as the Facility  Agent may reasonably request
      for perfecting and completing any assignment and transfer by a Lender.

26.   CHANGES TO THE OBLIGORS

26.1  ASSIGNMENTS AND TRANSFER BY OBLIGORS

      No Obligor may assign any of its rights or transfer  any of its rights or
      obligations under the Finance Documents.

26.2  ADDITIONAL BORROWERS

(a)   The Company may request that any of its Material  Subsidiaries becomes an
      Additional Borrower (and thereby an Additional Guarantor).  That Material
      Subsidiary shall become an Additional Borrower (and thereby an Additional
      Guarantor) if:

      (i)    the  Facility  Agent  approves  the  addition   of  that  Material
             Subsidiary;

      (ii)   the  Company delivers to the Facility Agent a duly  completed  and
             executed Borrower Accession Letter;

      (iii)  the Company  confirms that no Default is continuing or would occur
             as a result of  that  Material  Subsidiary  becoming an Additional
             Borrower (and thereby an Additional Guarantor);

      (iv)   such Additional Borrower provides and, to the  extent permitted by
             law, causes any Subsidiary to provide, such Security  for  all  or
             any  part  of  its  obligations under the Finance Documents as the
             Facility Agent shall reasonably require; and

      (v)    the Facility Agent has  received  all  of  the documents and other
             evidence listed in Part IV of Schedule 2 (Conditions Precedent and
             Conditions  Subsequent)  in relation to that Additional  Borrower,
             each in form and substance satisfactory to the Facility Agent.

(b)   The Facility Agent shall notify the Company and the Lenders promptly upon
      being satisfied that it has received (in form and substance  satisfactory
      to it) all the documents and other evidence listed in Part IV of Schedule
      2 (Conditions Precedent and Conditions Subsequent).

26.3  ADDITIONAL GUARANTORS

(a)   The Company may request that any of its Subsidiaries become an Additional
      Guarantor.  That  Subsidiary  (be it a Material  Subsidiary or not) shall
      become an Additional Guarantor if:

      (i)    the  Company  delivers  to the Facility Agent a duly completed and
             executed Guarantor Accession Letter;

      (ii)   such Additional Guarantor provides and, to the extent permitted by
             law, causes any of its Subsidiaries  to provide, such Security for
             all or any part of its obligations under  the Finance Documents as
             the Facility Agent shall require; and

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<PAGE>


      (iii)  the  Facility Agent has received all of the  documents  and  other
             evidence listed in Part IV of Schedule 2 (Conditions Precedent and
             Conditions  Subsequent)  in relation to that Additional Guarantor,
             each in form and substance satisfactory to the Facility Agent.

(b)   The Facility Agent shall notify the Company and the Lenders promptly upon
      being satisfied that it has received (in form and substance  satisfactory
      to it) all the documents and other evidence listed in Part IV of Schedule
      2 (Conditions Precedent and Conditions Subsequent).

(c)   To comply with the Minimum Guarantor Coverage, the Company may, and shall
      at the request  of  the  Facility Agent, cause any of its Subsidiaries to
      become an Additional Guarantor  by  causing  such Subsidiary to execute a
      Guarantor Accession Letter and all other documents referred to therein.

26.4  REPETITION OF REPRESENTATIONS

      Delivery of an Accession Letter constitutes confirmation  by the relevant
      Subsidiary  that  the Repeating Representations are true and  correct  in
      relation to it as at  the date of delivery as if made by reference to the
      facts and circumstances then existing.



                                   SECTION 10

                              THE FINANCE PARTIES

27.   ROLE OF THE FACILITY AGENT,  THE SECURITY AGENT, THE DOCUMENTATION AGENT,
      THE MANDATED LEAD ARRANGERS AND THE COMPANY AS AGENT OF THE OBLIGORS

27.1  APPOINTMENT OF THE FACILITY AGENT AND THE SECURITY AGENT

(a)   Each of the Finance  Parties other than the Facility  Agent  appoints the
      Facility  Agent to act as its  Agent  under  and in  connection  with the
      Finance Documents.

(b)   Each of the Finance  Parties other than the Security  Agent  appoints the
      Security Agent to act as its security agent under and in connection  with
      the Finance Documents.

(c)   Each of the Finance Parties other than the Facility Agent  authorises the
      Facility  Agent,  and each of the Finance Parties other than the Security
      Agent  authorises  the Security  Agent,  to exercise the rights,  powers,
      authorities  and  discretions  specifically  given  to  it  under  or  in
      connection with the Finance Documents  together with any other incidental
      rights, powers, authorities and discretions.

(d)   Each of the  Finance  Parties  other  than  the  Facility  Agent  and the
      Security  Agent hereby grants power of attorney to the Facility Agent and
      the  Security  Agent,  respectively,  to be  exercised  for the  purposes
      described in Clause  27.1(c).  The Facility  Agent and the Security Agent
      shall be  released  from the  restrictions  of Section  181 of the German
      Civil Code (Burgerliches  Gesetzbuch);  they  are  authorised to delegate
      their powers of attorney,  including the exemption from the  restrictions
      of Section 181 of the German  Civil Code.  At the request of the Facility
      Agent and/or the Security  Agent,  the Mandated  Lead  Arrangers  and the
      Lenders  shall grant  special  powers of attorney to the  Facility  Agent
      and/or the

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      Security Agent to enter into any Finance  Documents,  or  any  amendments
      thereof, on their behalf.

27.2  DUTIES OF THE FACILITY AGENT AND THE SECURITY AGENT

(a)   The Facility  Agent shall  promptly  forward to a Party the original or a
      copy of any document  that is  delivered  to the Facility  Agent for that
      Party by any other Party.

(b)   If the  Facility  Agent  receives  notice from a Party  referring to this
      Agreement,  describing  a  Default  and  stating  that  the  circumstance
      described is a Default,  it shall promptly  notify the Lenders and, where
      appropriate, the Issuing Banks.

(c)   The  Facility  Agent  shall  promptly   notify  the  Lenders  and,  where
      appropriate,  the Issuing Banks of any Default  arising under Clause 24.1
      (Non-payment).

(d)   The Facility  Agent shall  promptly  provide the Security Agent with such
      certificate(s)  as the Security Agent may require as to all amounts which
      are owing, actually or contingently, at any time by any Obligor to all or
      any of the Finance Parties (other than the Security Agent in its capacity
      as security agent) under the Finance Documents, whether or not due.

(e)   The  Security  Agent  shall  promptly  notify the  Facility  Agent of the
      contents  of any notice or document  received  by it, in its  capacity as
      security  agent,  from  any  of the  Obligors  under  any of the  Finance
      Documents.

(f)   Theduties of the Facility  Agent and the Security Agent under the Finance
      Documents are solely mechanical and administrative in nature.

27.3  ROLE OF THE DOCUMENTATION AGENT AND THE MANDATED LEAD ARRANGERS

      Except   as  specifically  provided  in  the   Finance   Documents,   the
      Documentation Agent and each Mandated Lead Arranger has no obligations of
      any kind to  any  other  Party  under  or  in connection with any Finance
      Document.

27.4  NO FIDUCIARY DUTIES

(a)   Nothing in this Agreement  constitutes the Facility  Agent,  the Security
      Agent  (except as  expressly  provided  in  Schedule 11 (Form of Security
      Trust  Agreement)),  the  Documentation  Agent,  the Issuing Banks or the
      Mandated Lead Arrangers as a trustee or fiduciary of any other person.

(b)   None of the  Facility  Agent,  the  Security  Agent  (except as expressly
      provided  in Schedule 11 (Form of  Security  Trust  Agreement)  or in any
      Security  Document),  the  Documentation  Agent, the Issuing Banks or the
      Mandated Lead  Arrangers  shall be bound to account to any Lender for any
      sum or the profit element of any sum received by it for its own account.

27.5  BUSINESS WITH THE GROUP

      The Facility  Agent,  the  Security  Agent,  the Documentation Agent, the
      Issuing Banks and the Mandated Lead Arrangers  may  accept deposits from,
      lend  money  to  and  generally  engage in any kind of banking  or  other
      business with any Group Member.

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27.6 RIGHTS AND DISCRETIONS OF THE FACILITY AGENT AND THE SECURITY AGENT

(a)   The Facility Agent and the Security Agent may rely on:

      (i)    any  communication,  notice or  document  believed  by  it  to  be
             genuine, correct and appropriately authorised; and

      (ii)   any statement made by a director, authorised signatory or employee
             of  any person regarding  any  matters  which  may  reasonably  be
             assumed to be within his knowledge or within his power to verify.

(b)   The  Facility  Agent and the  Security  Agent may  assume  (unless it has
      received  notice to the contrary in its capacity as facility agent or, as
      the case may be, as security agent) that:

      (i)    no Default has occurred (unless  it  has  actual  knowledge  of  a
             Default arising under Clause 24.1 (Non-payment));

      (ii)   any  right,  power, authority or discretion vested in any Party or
             the Majority Lenders has not been exercised; and

      (iii)    any  notice  or   request  made  by  the  Company (other  than  a
             Utilisation Request  or Selection Notice) is made on behalf of and
             with the consent and knowledge of all the Obligors.

(c)   Each of the Facility Agent and the Security Agent may engage, pay for and
      rely on the advice or services of any lawyers, accountants,  surveyors or
      other experts.

(d)   Each of the Facility  Agent and the Security Agent may act in relation to
      the Finance Documents through its personnel and agents.

27.7  MAJORITY LENDERS' INSTRUCTIONS

(a)   Unless a contrary  indication appears in a Finance Document,  each of the
      Facility Agent and the Security Agent shall:

      (i)    act  in  accordance  with any instructions  given  to  it  by  the
             Majority Lenders (or,  if  so  instructed by the Majority Lenders,
             refrain from acting or exercising  any  right, power, authority or
             discretion vested in it as Facility Agent  or  Security  Agent, as
             the case may be); and

      (ii)   not  be  liable  for any act (or omission) if it acts (or refrains
             from taking any action)  in accordance with such an instruction of
             the Majority Lenders.

(b)   Unless  a  contrary  indication  appears  in  a  Finance  Document,   any
      instructions  given by the  Majority  Lenders  will be binding on all the
      Lenders and the Mandated Lead Arrangers.

(c)   Each of the Facility Agent and the Security Agent may refrain from acting
      in  accordance  with the  instructions  of the  Majority  Lenders (or, if
      appropriate,  the Lenders)  until it has received such security as it may
      require for any cost,  loss or liability  (together  with any  associated
      VAT) which it may incur in complying with the instructions.

(d)   In the  absence  of  instructions  from the  Majority  Lenders,  (or,  if
      appropriate, all the Lenders) each of the Facility Agent and the Security
      Agent may act or refrain  from taking any action or from  exercising  any
      right,  power or  discretion  vested in it as an agent  under any Finance

                                      119

<PAGE>


      Document  unless  and until  instructed  by the  Majority  Lenders  as to
      whether or not such right, power or discretion is to be exercised and, if
      it is to be exercised, as to the manner in which it should be exercised.

(e)   Neither the Facility Agent nor the Security Agent is authorised to act on
      behalf of a Lender (without first obtaining that Lender's consent) in any
      legal or arbitration proceedings relating to any Finance Document.

27.8  RESPONSIBILITY FOR DOCUMENTATION

      None  of the Facility Agent, the Security Agent, the Documentation  Agent
      and the Mandated Lead Arrangers:

      (i)    is  responsible  for the adequacy, accuracy and/or completeness of
             any information (whether oral or written) supplied by the Facility
             Agent, the Security  Agent,  the Documentation Agent, the Mandated
             Lead Arrangers, an Obligor or  any other person and given in or in
             connection with any Finance Document; or

      (ii)   is responsible for the legality, validity, effectiveness, adequacy
             or enforceability of any Finance  Document or any other agreement,
             arrangement  or  document  entered  into,   made  or  executed  in
             anticipation of or in connection with any Finance Document.

27.9  EXCLUSION OF LIABILITY

(a)   Without limiting paragraph (b) below,  neither the Facility Agent nor the
      Security  Agent  will be liable  for any  action  taken by it under or in
      connection  with,  or for any  omission by it in relation to, any Finance
      Document,  unless  directly  caused  by its  gross  negligence  or wilful
      misconduct.

(b)   No Party may take any proceedings against any officer,  employee or agent
      of the Facility  Agent or the  Security  Agent in respect of any claim it
      might have against the Facility Agent or the Security Agent or in respect
      of any act or omission of any kind by that officer,  employee or agent in
      relation to any Finance  Document and any  officer,  employee or agent of
      the Facility Agent or the Security Agent may rely on this Clause.

(c)   Neither the Facility  Agent nor the Security Agent will be liable for any
      delay (or any  related  consequences)  in  crediting  an account  with an
      amount  required  under the Finance  Documents to be paid by it if it has
      taken all  necessary  steps as soon as reasonably  practicable  to comply
      with the regulations or operating  procedures of any recognised  clearing
      or settlement system used by it for that purpose.

27.10 LENDERS' INDEMNITY TO THE FACILITY AGENT AND THE SECURITY AGENT

      Each  Lender  shall  (in proportion to its share of the Total Commitments
      or, if the Total Commitments  are  then  zero,  to its share of the Total
      Commitments immediately prior to their reduction  to  zero) indemnify the
      Facility Agent and the Security Agent, within three (3)  Business Days of
      demand,  against  any  cost,  loss or liability incurred by the  Facility
      Agent  or the Security Agent (otherwise  than  by  reason  of  its  gross
      negligence  or  wilful misconduct) in acting as Facility Agent or, as the
      case may be, Security  Agent  under  the Finance Documents (unless it has
      been reimbursed by an Obligor pursuant to a Finance Document).

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27.11 RESIGNATION OF THE FACILITY AGENT OR THE SECURITY AGENT

(a)   The Facility  Agent or the  Security  Agent may resign and appoint one of
      its  Affiliates  as  successor  by giving  notice to the  Lenders and the
      Company.

(b)   Alternatively  the  Facility  Agent or the  Security  Agent may resign by
      giving notice to the Lenders and the Company,  in which case the Majority
      Lenders  (after  consultation  with the  Company) may appoint a successor
      agent or, as the case may be, security agent.

(c)   If the Majority Lenders have not appointed a successor facility agent or,
      as the case may be, security agent in accordance with paragraph (b) above
      within  thirty  (30) days after  notice of  resignation  was  given,  the
      Facility  Agent  or,  as the  case  may be,  the  Security  Agent  (after
      consultation with the Company) may appoint a successor  facility agent or
      security agent.

(d)   The retiring Facility Agent or Security Agent shall make available to its
      successor such  documents and records and provide such  assistance as its
      successor  may  reasonably  request for the  purposes of  performing  its
      functions  as  facility   agent  or  security  agent  under  the  Finance
      Documents.

(e)   The Facility Agent's resignation notice shall only take effect upon:

      (i)    the appointment of a successor; and

      (ii)   the receipt by the Facility Agent of written confirmation from the
             successor  (in form and substance  satisfactory  to  the  Facility
             Agent) that  the successor agrees to be bound by the provisions of
             the Finance Documents  and  all  other related agreements to which
             the Facility Agent is a party in its capacity as facility agent.

(f)   The Security Agent's resignation notice shall only take effect upon:

      (i)    the appointment of a successor;

      (ii)   the receipt by the Security Agent of written confirmation from the
             successor  (in form and  substance  satisfactory  to the  Security
             Agent) that the successor  agrees to be bound by the provisions of
             the Finance  Documents and all other  related  agreements to which
             the Security  Agent is a party in its capacity as security  agent;
             and

      (iii)  the receipt by the Facility Agent of written confirmation from the
             Security Agent (in form and substance satisfactory to the Facility
             Agent)  that  it  has  received,   and  found  satisfactory,   the
             confirmation  referred to in sub-paragraph (ii) above and that all
             Security  created  pursuant to the Security  Documents and all the
             Security  Agent's  rights,  benefits and  obligations  as security
             agent under the Finance  Documents  have been  transferred  to its
             successor.

(g)   Upon any such  resignation  notice taking effect,  the retiring  Facility
      Agent or Security Agent shall be discharged  from any further  obligation
      in respect of the  Finance  Documents  but shall  remain  entitled to the
      benefit of this  Clause 27 and,  in the case of the  Security  Agent,  of
      Schedule 11 (Form of Security Trust  Agreement)).  Its successor and each
      of the other Parties shall have the same rights and  obligations  amongst
      themselves as they would have had if such  successor had been an original
      Party.

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(h)   After consultation with the Company,  the Majority Lenders may, by notice
      to the Facility Agent or, as the case may be, the Security Agent, require
      it to resign in accordance with paragraph (b) above.  In this event,  the
      Facility Agent or, as the case may be, the Security Agent shall resign in
      accordance with paragraph (b) above.

27.12 CONFIDENTIALITY

(a)   The Facility  Agent (in acting as facility  agent) and the Security Agent
      (in acting as security  agent)  shall be  regarded as acting  through its
      respective  agency or security agent division which shall in each case be
      treated  as a  separate  entity  from  any  other  of  its  divisions  or
      departments.

(b)   If  information  is received by another  division  or  department  of the
      Facility  Agent or, as the case may be,  the  Security  Agent,  it may be
      treated as  confidential  to that division or department and the Facility
      Agent or, as the case may be, the  Security  Agent shall not be deemed to
      have notice of it.

(c)   Notwithstanding  any  other  provision  of any  Finance  Document  to the
      contrary,   none  of  the  Facility  Agent,   the  Security  Agent,   the
      Documentation  Agent  and the  Mandated  Lead  Arrangers  is  obliged  to
      disclose to any other person;

      (i)    any confidential information; or

      (ii)   any  other information if the disclosure would  or  might  in  its
             reasonable opinion constitute a breach of any law or a breach of a
             fiduciary duty.

27.13 RELATIONSHIP WITH THE LENDERS AND ISSUING BANKS

(a)   The  Facility  Agent may treat  each  Lender  as a  Lender,  entitled  to
      payments  under this  Agreement  and acting  through its Facility  Office
      unless it has received not less than five (5) Business  Days prior notice
      from that  Lender to the  contrary in  accordance  with the terms of this
      Agreement.

(b)   Each Lender shall supply the Facility Agent with any information required
      by the  Facility  Agent in  order  to  calculate  the  Mandatory  Cost in
      accordance with Schedule 4 (Mandatory Cost Formula).

(c)   Neither  the  Facility  Agent  nor the  Security  Agent  shall  have  any
      obligation  or  liability  to any Lender,  and Issuing  Bank or any other
      person as a result of any failure by any  Obligor or any other  person to
      perform any of its obligations under the Finance Documents.

27.14 CREDIT APPRAISAL BY THE LENDERS AND ISSUING BANKS

      Without  affecting  the  responsibility of any  Obligor  for  information
      supplied by it or on its behalf  in connection with any Finance Document,
      each Lender and each Issuing Bank  confirms  to  the  Facility Agent, the
      Security Agent, the Documentation Agent and the Mandated  Lead  Arrangers
      that it has been, and will continue to be, solely responsible for  making
      its  own  independent  appraisal  and  investigation of all risks arising
      under  or  in  connection with any Finance  Document  including  but  not
      limited to:

      (i)    the financial condition, status and nature of each Group Member;

      (ii)   the legality,  validity, effectiveness, adequacy or enforceability
             of  any  Finance  Document  and  any  other  agreement,  Security,
             arrangement  or  document   entered

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             into,  made   or  executed  in  anticipation  of,  under  or   in
             connection with any Finance Document;

      (iii)  whether that Lender or, as the  case  may  be,  Issuing  Bank  has
             recourse,  and the nature and extent of that recourse, against any
             Party or any  of its respective assets under or in connection with
             any Finance Document, the transactions contemplated by the Finance
             Documents  or  any   other  agreement,  Security,  arrangement  or
             document entered into,  made or executed in anticipation of, under
             or in connection with any Finance Document;

      (iv)   the ownership, value or sufficiency  of any of the Charged Assets,
             the adequacy or priority of any of the  Security  created pursuant
             to the Security Documents, the right or title of any  person in or
             to  any Charged Assets or the existence of any Security  affecting
             the same;

      (v)    the  adequacy,   accuracy   and/or   completeness   of  any  other
             information  provided  by the Facility Agent, the Security  Agent,
             any Party or any other person  under  or  in  connection  with any
             Finance  Document,  the  transactions  contemplated by the Finance
             Documents  or  any  other  agreement,  Security,   arrangement  or
             document entered into, made or executed in anticipation  of, under
             or in connection with any Finance Document; and

      (vi)   the  adequacy,  accuracy  and/or completeness of any communication
             delivered to it under any of  the  Finance Documents, any legal or
             other opinions, reports, valuations,  certificates,  appraisals or
             other  documents delivered or made or required to be delivered  or
             made at  any  time in connection with any of the Finance Documents
             or any other report  or  other  document, statement or information
             circulated, delivered or made, whether  orally  or  otherwise  and
             whether before, on or after the Signing Date.

27.15 REFERENCE BANKS

      If  a Reference Bank (or, if a Reference Bank is not a Lender, the Lender
      of which  it  is  an Affiliate) ceases to be a Lender, the Facility Agent
      shall appoint another  Lender or an Affiliate of a Lender to replace that
      Reference Bank.

27.16 MANAGEMENT TIME OF THE FACILITY AGENT AND THE SECURITY AGENT

      Any amount payable to the  Facility  Agent  or  the  Security Agent under
      Clause  16.3  (Indemnity  to the Facility Agent and the Security  Agent),
      Clause 18 (Costs and Expenses)  and  Clause 27.10  (Lenders' Indemnity to
      the  Facility  Agent and the Security Agent) shall include  the  cost  of
      utilising its management  time  or other resources and will be calculated
      on the basis of such reasonable daily or hourly rates as it may notify to
      the Company and the Lenders, and  is  in  addition  to  any  fee  paid or
      payable to it under Clause 13 (Fees).

27.17 PARALLEL DEBT

(a)   Each of the Parties hereto agree, and the Obligors acknowledge by way  of
      an  abstract acknowledgement of debt (abstraktes Schuldanerkenntnis) (the
      "ACKNOWLEDGEMENT"),  that  each  and every obligation of any such Obligor
      (and any of its successors pursuant  to  this Agreement), and in relation
      to the Company in the amount of [e] 350,000,000  under this Agreement and
      the  other Finance Documents shall also be owing in full to the  Security
      Agent  (and  each  of  the latter's successors under this Agreement), and
      that accordingly the

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      Security Agent will have its own independent right to demand  performance
      by such  Obligor of those  obligations.  The  Security  Agent  undertakes
      towards the relevant  Obligor  that in case of any  discharge of any such
      obligation  owing to one of the  Security  Agent or a Finance  Party,  it
      will, to the same extent,  not make a claim against any Obligor under the
      Acknowledgement  at any time,  PROVIDED  THAT any such claims can be made
      against an Obligor  if such  discharge  is made by virtue of any set off,
      counterclaim or similar defence invoked by that Obligor  vis-a-vis the
      Security Agent.

(b)   Without limiting  or  affecting  the  Security Agent's rights against any
      Obligor (whether under this paragraph or under any other provision of the
      Finance Documents), the Security Agent  agrees  with  each  other Finance
      Party  (on a several and divided basis) that, subject as set out  in  the
      next sentence,  it will not exercise its rights under the Acknowledgement
      except with the consent  of  the relevant Finance Party. However, for the
      avoidance of doubt, nothing in  the  previous  sentence  shall in any way
      limit the Security Agent's right to act in the protection or preservation
      of  rights  under or to enforce any Security Document as contemplated  by
      this Agreement  and/or  the  relevant Security Document (or to do any act
      reasonably incidental to the foregoing).

27.18 THE COMPANY AS AGENT OF THE OBLIGORS

      Each Obligor other than the Company irrevocably authorises the Company to
      act on its behalf as its agent  in  relation to the Finance Documents and
      irrevocably authorises:

(a)   the Company on its behalf to supply all  information  concerning  itself,
      its  financial   condition   and   otherwise  to  the  relevant   persons
      contemplated   under  this   Agreement   and  to  give  all  notices  and
      instructions  (including,   in  the  case  of  a  Borrower  (and  without
      limitation),  Utilisation Requests and Selection Notices) and to make any
      agreement  capable of being made by it on its  behalf  under the  Finance
      Documents  without  further  reference to or the consent of such Obligor;
      and

(b)   each Finance Party to make any  communication  or deliver any document to
      be made or delivered to such Obligor pursuant to the Finance Documents to
      the Company on its behalf in accordance with Clause 33 (Notices),

      and in each such case such Obligor will be bound  thereby  as though such
      Obligor  had  itself  supplied  such  information, given such notice  and
      instructions or made such agreement or,  as  the  case may be, as if such
      communication or document had been made or delivered  to it in accordance
      with Clause 33 (Notices).

28.   THE LENDERS, THE ISSUING BANKS AND THE SUBFACILITY BANKS

28.1  LENDERS' INDEMNITY

(a)   If the Company fails to comply with its obligations under Clause 8.2 (The
      Company's Indemnity to Issuing Banks) in respect of any Letter of Credit,
      the Facility Agent shall make demand on each Term Facility  B  Lender for
      its  share  of  the  relevant  Letter of Credit Amount in respect of  any
      Letter of Credit and, subject to Clause 28.2 (Direct Participation), each
      Term Facility B Lender shall indemnify  each  Issuing Bank, respectively,
      for  that Term Facility B Lender's Letter of Credit  Proportion  of  such
      Letter  of  Credit  Amount.  The  indemnity  obligations pursuant to this
      Clause 28.1 shall in respect of any Original Issuing  Bank which is not a
      party  to  this  Agreement create direct claims of such Original  Issuing
      Bank (Vertrag zugunsten Dritter) against the Term Facility B Lenders.

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(b)   If any Borrower fails  to  comply  with its payment obligations under any
      Subfacility in case of termination of such Subfacility in accordance with
      Clause  2.2  (e)  or  the scheduled maturity  of  such  Subfacility,  the
      Facility Agent shall make demand on each Revolving Credit Facility Lender
      for its proportionate share  of  the relevant amount of such Subfacility,
      and subject to Clause 28.2 (Direct  Participation), each Revolving Credit
      Facility Lender shall indemnify each  Subfacility Bank for that Revolving
      Credit Facility Lender's proportion in  such  Subfacility  in relation to
      such  Revolving Credit Facility Lender's Available Commitment  under  the
      Revolving Credit Facility.

28.2  DIRECT PARTICIPATION

(a)   If any Term  Facility B Lender is not  permitted  (by its  constitutional
      documents or any applicable law) to comply with Clause 28.1(a)  (Lenders'
      Indemnity) then that Term Facility B Lender will not be obliged to comply
      with Clause 28.1(a)  (Lenders'  Indemnity) and shall instead be deemed to
      have taken on the date any Letter of Credit is issued (or,  if later,  on
      the date that any Letter of Credit Proportion in respect of any Letter of
      Credit is  transferred  or  assigned  to such Term  Facility  B Lender in
      accordance with the terms of this Agreement),  an undivided  interest and
      participation  in the  Letter of  Credit in an amount  equal to that Term
      Facility B Lender's Letter of Credit Proportion of the Letter of Credit.

(b)   On receipt of demand by the  Facility  Agent in  accordance  with  Clause
      28.1(a) (Lenders' Indemnity),  each such Term Facility B Lender shall pay
      to the Facility Agent (for the account of the Issuing Bank) its Letter of
      Credit Proportion of any Letter of Credit Amount.

(c)   If any  Revolving  Credit  Facility  Lender  is  not  permitted  (by  its
      constitutional  documents  or any  applicable  law) to comply with Clause
      28.1(b)  (Lenders'  Indemnity) then that Revolving Credit Facility Lender
      will not be obliged to comply with Clause  28.1(b)  (Lenders'  Indemnity)
      and shall  instead  be deemed to have  taken on the date  Subfacility  is
      agreed, an undivided  interest and participation in the Subfacility in an
      amount equal to that Revolving Credit Facility Lender's proportion of the
      Subfacility.

(d)   On receipt of demand by the  Facility  Agent in  accordance  with  Clause
      28.1(b) (Lenders' Indemnity),  each such Revolving Credit Facility Lender
      shall pay to the Facility Agent (for the account of the Subfacility Bank)
      its proportion of the relevant Subfacility.

28.3  OBLIGATIONS NOT DISCHARGED

      Neither the obligations of each Term Facility B Lender and/or Subfacility
      Bank in this Clause 28 nor the rights, powers and remedies conferred upon
      any Issuing Bank and/or  Subfacility  Bank  by  this  Agreement or by law
      shall be discharged, impaired or otherwise affected by:

      (a)    the winding-up, dissolution,  administration or re-organisation of
             the relevant Issuing Bank and/or Subfacility Bank, any Borrower or
             any other person or any change in the status, function, control or
             ownership of any of them;

      (b)    any of  the  obligations  of  the  relevant  Issuing  Bank  and/or
             Subfacility  Bank,  any  Borrower or any other  person  under this
             Agreement,  under the Letter of Credit,  any  Subfacility or under
             any other security taken in respect of any Borrower's  obligations
             under this Agreement or otherwise in connection with any Letter of
             Credit  and/or any  Subfacility,  respectively,  being or becoming
             illegal, invalid, unenforceable or ineffective in any respect;

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      (c)    time or other  indulgence being granted or agreed to be granted to
             the relevant Issuing Bank,  Subfacility  Bank, any Borrower or any
             other  person in respect of the  obligations  of any of them under
             this Agreement, under any Letter of Credit and/or any Subfacility,
             respectively,  or under any other security taken in respect of any
             Borrower's  obligations  under  this  Agreement  or  otherwise  in
             connection  with any  Letter of  Credit  and/or  any  Subfacility,
             respectively;

      (d)    any  amendment  to, or any  variation,  waiver or release  of, any
             obligation of the relevant  Issuing Bank,  Subfacility  Bank,  any
             Borrower  or any other  person  under  this  Agreement,  under any
             Letter of Credit and/or any  Subfacility,  respectively,  or under
             any other security taken in respect of any Borrower's  obligations
             under this Agreement or otherwise in connection with any Letter of
             Credit and/or Subfacility, respectively; and

      (e)    any other act,  event or omission  which,  but for this Clause 28,
             might operate to discharge,  impair or otherwise affect any of the
             obligations of each Term Facility B Lender and/or Revolving Credit
             Facility Lender, respectively,  contained in this Agreement or any
             of the rights,  powers or remedies conferred upon any Issuing Bank
             and/or Subfacility Bank by this Agreement or by law.

      The obligations of each Lender contained in this Agreement  shall  be  in
      addition  to  and  independent  of every other security which any Issuing
      Bank and/or Subfacility Bank may  at  any  time  hold  in  respect of any
      Borrower's  obligations  under this Agreement or otherwise in  connection
      with any Letter of Credit and/or Subfacility, respectively.

28.4  SETTLEMENT CONDITIONAL

      Any settlement or discharge  between  a  Term  Facility  B  Lender  and a
      Issuing  Bank  shall  be  conditional  upon no security or payment to any
      Issuing Bank by a Term Facility B Lender or any other person on behalf of
      a Term Facility B Lender being avoided or  reduced  by virtue of any laws
      relating  to  bankruptcy,  insolvency,  liquidation  or similar  laws  of
      general application and, if any such security or payment is so avoided or
      reduced,  such  Issuing Bank shall be entitled to recover  the  value  or
      amount of such security  or  payment  from  such  Term  Facility B Lender
      subsequently  as  if  such settlement or discharge had not occurred.  The
      same shall apply mutatis  mutandis  in  relation  to  a  Revolving Credit
      Facility Lender and a Subfacility Bank.

28.5  EXERCISE OF RIGHTS

      No Issuing Bank and no Subfacility Bank, respectively, shall  be  obliged
      before exercising any of the rights, powers or remedies conferred upon it
      in  respect  of  any Term Facility B Lender and Revolving Credit Facility
      Lender, respectively, by this Agreement or by law:

      (a)    to take any action or obtain  judgment  in any court  against  any
             Obligor;

      (b)    to make or file any claim or proof in a winding-up or  dissolution
             of any Obligor; or

      (c)    to enforce or seek to enforce any other  security taken in respect
             of any of the obligations of the Obligors under this Agreement.

29.   CONDUCT OF BUSINESS BY THE FINANCE PARTIES

      No provision of this Agreement will:

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      (a)    interfere with  the  right  of  any  Finance  Party to arrange its
             affairs (tax or otherwise) in whatever manner it thinks fit;

      (b)    oblige  any  Finance  Party  to investigate or claim  any  credit,
             relief, remission or repayment  available  to  it  or  the extent,
             order and manner of any claim; or

      (c)    oblige  any Finance Party to disclose any information relating  to
             its affairs  (tax  or otherwise) or any computations in respect of
             Tax.

30.   SHARING AMONG THE LENDERS

30.1  PAYMENTS TO LENDERS

      If a Lender (a "RECOVERING  LENDER") receives or recovers any amount from
      an Obligor (including by way  of  set-off  in  accordance  with Clause 32
      (Set-off))  other  than in accordance with Clause 31 (Payment  Mechanics)
      and applies that amount  to  a  payment  due  under the Finance Documents
      then:

      (a)    the  Recovering  Lender  shall, within three  (3)  Business  Days,
             notify details of the receipt or recovery to the Facility Agent;

      (b)    the Facility Agent shall determine whether the receipt or recovery
             is in excess of the amount  the  Recovering Lender would have been
             paid had the receipt or recovery been  received  or  made  by  the
             Facility  Agent  and  distributed  in  accordance  with  Clause 31
             (Payment Mechanics), without taking account of any Tax which would
             be  imposed  on  the  Facility  Agent  in relation to the receipt,
             recovery or distribution; and

      (c)    the Recovering Lender shall, within three  (3)  Business  Days  of
             demand  by the Facility Agent, pay to the Facility Agent an amount
             (the "SHARING PAYMENT") equal to such receipt or recovery less any
             amount which  the Facility Agent determines may be retained by the
             Recovering Lender  as  its  share  of  any  payment to be made, in
             accordance with Clause 31.5 (Partial Payments).

30.2  REDISTRIBUTION OF PAYMENTS

      The Facility Agent shall treat the Sharing Payment as if it had been paid
      by  the  relevant Obligor and distribute it between the  Finance  Parties
      (other  than  the  Recovering  Lender)  in  accordance  with  Clause 31.5
      (Partial Payments).

30.3  RECOVERING LENDER'S RIGHTS

(a)   On a distribution by the Facility Agent under Clause 30.2 (Redistribution
      of Payments),  the Finance Parties that have shared in the redistribution
      shall assign to the  Recovering  Lender their rights to the payments that
      were redistributed.

(b)   If and to the extent  that the  Recovering  Lender is not able to rely on
      its rights  under  paragraph  (a) above,  the relevant  Obligor  shall be
      liable to the Recovering  Lender for a debt equal to the Sharing  Payment
      that is immediately due and payable.

30.4  REVERSAL OF REDISTRIBUTION

      If any part of the Sharing Payment received or recovered  by a Recovering
      Lender becomes repayable and is repaid by that Recovering Lender, then:

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      (a)    each  Lender  which  has received a share of the relevant  Sharing
             Payment  pursuant  to  Clause 30.2  (Redistribution  of  Payments)
             shall, upon request of the  Facility  Agent,  pay  to the Facility
             Agent for account of that Recovering Lender an amount equal to its
             share  of  the  Sharing  Payment  (together with an amount  as  is
             necessary to reimburse that Recovering  Lender  for its proportion
             of  any  interest  on  the  Sharing Payment which that  Recovering
             Lender is required to pay); and

      (b)    that  Recovering  Lender's  rights  to  take  the  benefit  of  an
             assignment in respect of any  reimbursement shall be cancelled and
             the relevant Obligor will be liable  to the reimbursing Lender for
             the amount so reimbursed.

30.5  EXCEPTIONS

(a)   This Clause 30 shall not apply to the extent that the  Recovering  Lender
      would not, after making any payment pursuant to this Clause, have a valid
      and enforceable claim against the relevant Obligor.

(b)   A  Recovering  Lender is not  obliged to share with any other  Lender any
      amount which the Recovering  Lender has received or recovered as a result
      of taking legal or arbitration proceedings if:

      (i)    it  notified  the  other  Lenders  of  the  legal  or  arbitration
             proceedings; and

      (ii)   the other Lenders had an opportunity to participate in those legal
             or arbitration proceedings but did not do so as soon as reasonably
             practicable having received notice and did not take separate legal
             or arbitration proceedings.



                                  SECTION 11

                                ADMINISTRATION

31.   PAYMENT MECHANICS

31.1  PAYMENTS TO THE FACILITY AGENT

      (i)    On each date on which an Obligor or a Lender is required to make a
             payment  under  a  Finance  Document,  that  Obligor  (subject  to
             Clause 31.9 (Payments to the Security Agent)) or that Lender shall
             make the same available to the Facility Agent  (unless  a contrary
             indication  appears  in  a Finance Document) for value on the  due
             date at the time and in such funds specified by the Facility Agent
             as being customary at the  time  for settlement of transactions in
             the relevant currency in the place of payment.

      (ii)   Payment shall be made to such account  in  the principal financial
             centre of the country of that currency (or,  in  relation to Euro,
             in a principal financial centre in a Participating Member State or
             London) with such bank as the Facility Agent specifies.

31.2  DISTRIBUTIONS BY THE FACILITY AGENT

      Each  payment received by the Facility Agent under the Finance  Documents
      for another  Party  shall,  subject  to  Clause 31.3 (Distributions to an
      Obligor),  Clause 31.4  (Clawback)  and  Clause 31.9   (Payments  to  the
      Security  Agent),  be  made available by the Facility Agent

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      as soon as  practicable  after  receipt to the Party  entitled to receive
      payment in accordance  with this Agreement (in the case of a Lender,  for
      the account of its  Facility  Office),  to such account as that Party may
      notify to the  Facility  Agent by not less than five (5)  Business  Days'
      notice with a bank in the  principal  financial  centre of the country of
      that currency (or, in relation to Euro, in a principal  financial  centre
      in a Participating Member State or London).

31.3  DISTRIBUTIONS TO AN OBLIGOR

      Each of the Facility Agent and the Security  Agent  may (with the consent
      of  the  Obligor  or  in accordance with Clause 32 (Set-Off))  apply  any
      amount received by it for that Obligor in or towards payment (on the date
      and in the currency and  funds  of  receipt)  of any amount due from that
      Obligor  under  the Finance Documents or in or towards  purchase  of  any
      amount of any currency to be so applied.

31.4  CLAWBACK

      (i)    Where a sum  is  to  be paid to the Facility Agent or the Security
             Agent under the Finance  Documents for another Party, the Facility
             Agent or, as the case may be, the Security Agent is not obliged to
             pay that sum to that other  Party (or to enter into or perform any
             related exchange contract) until  it has been able to establish to
             its satisfaction that it has actually received that sum.

      (ii)   If the Facility Agent or the Security  Agent  pays  an  amount  to
             another  Party  and  it  proves  to  be  the  case that it had not
             actually received that amount, then the Party to  whom that amount
             (or the proceeds of any related exchange contract)  was paid shall
             on  demand refund the same to the Facility Agent or, as  the  case
             may be,  the Security Agent, together with interest on that amount
             from the date  of  payment  to the date of receipt by the Facility
             Agent or, as the case may be, the Security Agent, calculated by it
             to reflect its cost of funds.

31.5  PARTIAL PAYMENTS

(a)   If the  Facility  Agent  receives  a  payment  that  is  insufficient  to
      discharge  all the amounts  then due and payable by an Obligor  under the
      Finance  Documents,  the Facility Agent shall apply that payment  towards
      the  obligations  of that  Obligor  under the  Finance  Documents  in the
      following order:

      (i)    FIRST,  in or towards  payment pro rata of any unpaid fees,  costs
             and  expenses of the  Facility  Agent,  the  Security  Agent,  the
             Documentation  Agent or the  Mandated  Lead  Arrangers  under  the
             Finance Documents;

      (ii)   SECONDLY,  in or towards  payment of any demand made by an Issuing
             Bank in  respect  of a payment  made or to be made by it under any
             Letter of Credit due but unpaid;

      (iii)  THIRDLY, in or towards payment pro rata of any accrued interest or
             commission due or Fronting Fees but unpaid under this Agreement;

      (iv)   FOURTHLY,  in or towards payment pro rata of any  Outstandings due
             but unpaid under this Agreement; and

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      (v)    FIFTHLY,  in or towards  payment pro rata of any other sum due but
             unpaid under the Finance Documents.

(b)   The Facility Agent shall,  if so directed by the Majority  Lenders,  vary
      the order set out in paragraphs (a)(ii) to (iv) above.

(c)   Paragraphs (a) and (b) above will override any  appropriation  made by an
      Obligor.

31.6  NO SET-OFF BY OBLIGORS

      All  payments  to be made by an Obligor under the Finance Documents shall
      be calculated and  be  made  without (and free and clear of any deduction
      for) set-off or counterclaim,  except  in respect of claims of an Obligor
      which are either undisputed between the  relevant  Finance Party and that
      Obligor or which have been the subject of a final court judgement.

31.7  BUSINESS DAYS

(a)   Any payment  which is due to be made on a day that is not a Business  Day
      shall be made on the next  Business  Day in the same  calendar  month (if
      there is one) or the preceding Business Day (if there is not).

(b)   During any  extension of the due date for payment of any  principal or an
      Unpaid Sum under this  Agreement  interest is payable on the principal at
      the rate payable on the original due date.

31.8  CURRENCY OF ACCOUNT

(a)   Subject to  paragraphs  (b) to (f)  below,  the Euro is the  currency  of
      account  and  payment  for any sum due from an Obligor  under any Finance
      Document.

(b)   A  repayment  of a Loan or Unpaid  Sum or a part of a Loan or Unpaid  Sum
      shall  be made in the  currency  in  which  that  Loan or  Unpaid  Sum is
      denominated on its due date.

(c)   Each  payment  in respect  of any  Letter of Credit  (including  any Cash
      Collateral  in  respect  of any  Letter of  Credit)  shall be made in the
      currency in Euros.

(d)   Each  payment of interest  shall be made in the currency in which the sum
      in respect of which the  interest  is payable was  denominated  when that
      interest accrued.

(e)   Each payment in respect of costs,  expenses or Taxes shall be made in the
      currency in which the costs, expenses or Taxes are incurred.

(f)   Any amount  expressed to be payable in a currency  other than Euros shall
      be paid in that other currency.

31.9  PAYMENTS TO THE SECURITY AGENT

      Notwithstanding any  other provision of any Finance Document, at any time
      after any of the Transaction  Security  becomes enforceable, the Security
      Agent may require:

      (a)    any  Obligor  to  pay  all  sums due from  it  under  any  Finance
             Document; or

      (b)    the Facility Agent to pay all  sums received or recovered from any
             Obligor under any Finance Document,

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      in  each  case  as  the  Security Agent may  direct  for  application  in
      accordance with the terms of the Finance Documents.

32.   SET-OFF

      A Finance Party may set off  any  matured  obligation due from an Obligor
      under  the Finance Documents (to the extent beneficially  owned  by  that
      Finance  Party) against any matured obligation owed by that Finance Party
      to that Obligor,  regardless  of  the place of payment, booking branch or
      currency  of  either  obligation. If the  obligations  are  in  different
      currencies, the Finance  Party  may convert either obligation at a market
      rate of exchange in its usual course  of  business for the purpose of the
      set-off.

33.   NOTICES

33.1  COMMUNICATIONS IN WRITING

      Any  communication  to be made under or in connection  with  the  Finance
      Documents shall be made  in  writing and, unless otherwise stated, may be
      made by fax or letter.

33.2  ADDRESSES

      The address and fax number (and  the  department  or officer, if any, for
      whose attention the communication is to be made) of  each  Party  for any
      communication  or document to be made or delivered under or in connection
      with the Finance Documents is:

      (a)    in the case of the Company, that identified with its name below;

      (b)    in the case  of  each  Lender,  each  Issuing  Bank  or  any other
             Obligor,  that  notified  in  writing to the Facility Agent on  or
             prior to the date on which it becomes a Party;

      (c)    in  the  case of the Mandated Lead  Arrangers,  the  Documentation
             Agent, the  Facility Agent and the Security Agent, that identified
             with its name below;

      (d)    in the case of  any  successor  Agent, that notified in writing to
             the  retiring  Agent  on  or  prior  to  the  date  on  which  the
             resignation notice of the retiring Agent takes effect; and

      (e)    in  the case of any successor Security  Agent,  that  notified  in
             writing to the Facility Agent on or prior to the date on which the
             resignation notice of the retiring Security Agent takes effect.

      or any substitute  address,  fax  number  or department or officer as the
      Party may notify to the Facility Agent (or  the Facility Agent may notify
      to the other Parties, if a change is made by  the  Facility Agent) by not
      less than five (5) Business Days' notice.

33.3  DELIVERY

(a)   Subject to Clause 33.6 (Electronic Communication), any  communication  or
      document  made  or  delivered  by  one  person  to  another  under  or in
      connection with the Finance Documents will only be effective:

      (i)  if by way of fax, when received in legible form; or

                                      131

<PAGE>


      (ii)   if by way of letter, when it has been left at the relevant address
             or  five  (5)  Business  Days  after  being  deposited in the post
             postage prepaid in an envelope addressed to it at that address,

      and, if a particular department or officer is specified  as  part  of its
      address  details provided under Clause 33.2 (Addresses), if addressed  to
      that department or officer.

(b)   Any communication  or  document  to  be made or delivered to the Facility
      Agent or the Security Agent will be effective only when actually received
      by it and then only if it is expressly  marked  for  the attention of the
      department  or  officer  identified  with  its  signature below  (or  any
      substitute department or officer as it shall specify for this purpose).

(c)   All  notices  from  or to an Obligor shall be sent through  the  Facility
      Agent.

(d)   Any communication or  document  made  or  delivered  to  the  Company  in
      accordance with this Clause will be deemed to have been made or delivered
      to each of the Obligors.

33.4  NOTIFICATION OF ADDRESS, FAX NUMBER

      Promptly  upon  receipt  of  notification of an address and fax number or
      change of address or fax number  pursuant  to  Clause 33.2 (Addresses) or
      changing its own address or fax number, the Facility  Agent  shall notify
      the other Parties.

33.5  ENGLISH LANGUAGE

(a)   Any notice given under or in connection with any Finance Document must be
      in English.

(b)   All  other  documents  provided  under  or in connection with any Finance
      Document must be:

      (i)    in English; or

      (ii)   if not in English,  and if so reasonably  required by the Facility
             Agent,  accompanied by an English  translation  and, in this case,
             the English  translation  will  prevail  unless the  document is a
             constitutional, statutory or other official document.

33.6   ELECTRONIC COMMUNICATION

(a)   Any  communication  (other than in connection with a Utilisation Request)
      to be made between the Facility Agent and a Lender under or in connection
      with the Finance Documents  may  be  made  by  electronic  mail  or other
      electronic means; and the Facility Agent and each Lender:

      (i)    hereby agree that, unless and until notified to the contrary, this
             is to be an accepted form of communication;

      (ii)   shall  notify  each  other  in writing of their current electronic
             mail address and/or any other  information  required to enable the
             sending and receipt of information by that means; and

      (iii)  shall  notify  each other of any change to their  address  or  any
             other such information supplied by them.

(b)   Any electronic communication made between the Facility Agent and a Lender
      will be effective only when actually received in readable form and in the
      case of any electronic

                                      132

<PAGE>


      communication  made  by  a  Lender  to  the Facility Agent only  if it is
      addressed in such a manner as the  Facility  Agent shall specify for this
      purpose.

34.   CALCULATIONS AND CERTIFICATES

34.1  ACCOUNTS

      In any litigation  or  arbitration  proceedings  arising  out  of  or  in
      connection  with  a  Finance  Document,  the entries made in the accounts
      maintained by a Finance Party are prima facie  evidence of the matters to
      which they relate.

34.2  CERTIFICATES AND DETERMINATIONS

      Any certification or determination by a Finance Party of a rate or amount
      under any Finance Document and by an Issuing Bank  as  to the amount paid
      out by that Issuing Bank in respect of any Letter of Credit  is,  in  the
      absence of manifest error, conclusive evidence of the matters to which it
      relates.

34.3  DAY COUNT CONVENTION

      Any  interest,  commission  or fee accruing under a Finance Document will
      accrue from day to day and is  calculated  on  the  basis  of  the actual
      number  of days elapsed and a year of 360 days or, in any case where  the
      practice  in  the  Relevant  Interbank Market differs, in accordance with
      that market practice.

35.   PARTIAL INVALIDITY

      If, at any time, any provision  of  the  Finance  Documents is or becomes
      illegal, invalid or unenforceable in any respect under  any  law  of  any
      jurisdiction,  neither  the  legality,  validity or enforceability of the
      remaining provisions nor the legality, validity or enforceability of such
      provision under the law of any other jurisdiction  will  in  any  way  be
      affected or impaired.

36.   REMEDIES AND WAIVERS

      No  failure  to exercise, nor any delay in exercising, on the part of any
      Finance Party,  any  right  or  remedy  under the Finance Documents shall
      operate as a waiver, nor shall any single  or  partial  exercise  of  any
      right  or remedy prevent any further or other exercise or the exercise of
      any other  right  or  remedy.  The  rights  and remedies provided in this
      Agreement  are cumulative and not exclusive of  any  rights  or  remedies
      provided by law.

37.   AMENDMENTS AND WAIVERS

37.1  REQUIRED CONSENTS

(a)   Subject to Clause 37.2  (Exceptions),  any  term of the Finance Documents
      may be amended or waived only with the consent  of  the  Majority Lenders
      and the Obligors and any such amendment or waiver will be  binding on all
      Parties.

(b)   The  Facility  Agent  may  effect,  on  behalf of any Finance Party,  any
      amendment or waiver permitted by this Clause 37.

                                      133

<PAGE>


37.2  EXCEPTIONS

(a)   An amendment or waiver that has the effect  of  changing or which relates
      to:

      (i)    the definition of "MAJORITY LENDERS" in Clause 1.1 (Definitions);

      (ii)   the length of any or all of the Availability Periods;

      (iii)  an  extension  to the date of  payment  of any  amount  under  the
             Finance Documents;

      (iv)   the currency in which any payment under any Finance Document is to
             be made;

      (v)    a reduction in the Margin,  the Letter of Credit  Commission Rate,
             the  Guarantee  Commission  Rate or the  amount of any  payment of
             principal, interest, fees or commission payable;

      (vi)   an increase in Commitment;

      (vii)  a change to the Borrowers or  Guarantors  other than in accordance
             with Clause 26 (Changes to the Obligors);

      (viii) any  provision  which  expressly  requires  the consent of all the
             Lenders;

      (ix)   Clause 2.3 (Finance  Parties' Rights and  Obligations),  Clause 25
             (Changes to the Lenders) or this Clause 37; or

      (x)    a release of Security  created  pursuant  to a Security  Document,
             provided  a release  of  Security  shall  only  require  the prior
             written consent of the Majority  Lenders in case this is requested
             in the course of a merger between Group Members  provided that the
             released  Security  will be replaced by security of same value and
             same  kind (as  determined  in the  reasonable  discretion  of the
             Majority  Lenders) in favour of the Finance  Parties which will be
             executed  prior  to or as of  effectiveness  of  the  merger  or -
             reasonably  demonstrated by the Company to the satisfaction of the
             Majority Lenders due to legal  requirements not otherwise feasible
             - without undue delay after such merger.

      shall not be made without the prior consent of all the Lenders.

(b)   An amendment or waiver that relates to the rights or  obligations  of the
      Facility Agent, the Security Agent or the Mandated Lead Arrangers may not
      be effected without the consent of the Facility Agent, the Security Agent
      or the Mandated Lead Arrangers, as the case may be.

37.3  AMENDMENTS BY THE COMPANY AS AGENT OF THE OBLIGORS

      The Company (acting on behalf of each Obligor) may agree to any amendment
      to or modification of the provisions of any of the Finance Documents,  or
      grant  any waiver or consent in relation to any of the Finance Documents,
      and the  Obligors  will  be  bound  by  any such amendment, modification,
      waiver or consent, except where the Facility  Agent  has received written
      notice  to  the contrary from an Obligor prior to the date  of  any  such
      amendment or modification.

                                      134

<PAGE>


38.   COUNTERPARTS

      Each Finance  Document may be executed in any number of counterparts, and
      this has the same effect as if the signatures on the counterparts were on
      a single copy of the Finance Document.



                                   SECTION 12

                         GOVERNING LAW AND ENFORCEMENT

39.   GOVERNING LAW

      This Agreement is governed by German law.

40.   ENFORCEMENT

40.1  JURISDICTION OF GERMAN COURTS

(a)   The courts of Frankfurt am Main have exclusive jurisdiction to settle any
      dispute arising  out of or in connection with this Agreement (including a
      dispute  regarding   the  existence,  validity  or  termination  of  this
      Agreement) (a "DISPUTE").

(b)   No Finance Party shall be prevented from taking proceedings relating to a
      Dispute in any other courts  of  competent  jurisdiction.  To  the extent
      allowed  by  law, the Finance Parties may take concurrent proceedings  in
      any number of jurisdictions.

40.2  SERVICE OF PROCESS

      Without prejudice to any other mode of service allowed under any relevant
      law, each Obligor  (other  than  an  Obligor  incorporated in the Federal
      Republic of Germany):

      (a)    irrevocably  appoints  the Company as its  agent  for  service  of
             process in relation to any proceedings before the German courts in
             connection with any Finance Document; and

      (b)    agrees that failure by a  process  agent  to  notify  the relevant
             Obligor  of  the  process  will  not  invalidate  the  proceedings
             concerned.

40.3  WAIVER OF IMMUNITY

      To the extent that any of the Obligors may in any jurisdiction  claim for
      itself  or  its assets immunity from suit, execution, attachment (whether
      in aid of execution  before judgment or otherwise) or other legal process
      and to the extent that  in  any such jurisdiction there may be attributed
      to itself or its assets such  immunity  (whether  or  not  claimed), such
      Obligor  irrevocably  agrees  not  to  claim and irrevocably waives  such
      immunity to the full extent permitted by the laws of such jurisdiction.

40.4  CONFIRMATIONS PURSUANT TO SECTION 8 MONEY LAUNDERING ACT

      Each Borrower expressly confirms towards  each  Finance  Party  that  all
      funds  made  available to it under this Agreement have been drawn for the
      its own account,  and that it is

                                      135

<PAGE>

      the economic  beneficiary  (wirtschaftlich  Begunstigter)  within  the
      meaning of Section 8 Money Laundering Act (Geldwaschegesetz).

      THIS AGREEMENT HAS BEEN ENTERED INTO ON THE  DATE STATED AT THE BEGINNING
      OF THIS AGREEMENT.

                                      136

<PAGE>


                                  SCHEDULE 1

                             THE ORIGINAL PARTIES

                                    PART I
                             THE ORIGINAL OBLIGORS


<TABLE>
<CAPTION>
NAME OF ORIGINAL BORROWER                             JURISDICTION OF INCORPORATION AND REGISTRATION NUMBER (OR EQUIVALENT, IF ANY)
<S>                                                   <C>
SGL Carbon Aktiengesellschaft                         Germany, registered with the local court Wiesbaden under HRB 9448
SGL CARBON S.A., La Coruna                            Spain
SGL CARBON S.p.A., Milano                             Italy
</TABLE>


<TABLE>
<CAPTION>
NAME OF ORIGINAL GUARANTOR                            JURISDICTION OF INCORPORATION AND REGISTRATION NUMBER (OR EQUIVALENT, IF ANY)
<S>                                                    <C>
SGL Carbon Aktiengesellschaft                         Germany, registered with the local court Wiesbaden under HRB 9448
SGL Carbon GmbH                                       Germany, registered with the local court Augsburg under HRB 16474
SGL Carbon Beteiligung GmbH, Wiesbaden                Germany, registered with the local court Wiesbaden under HRB 11330
SGL ACOTEC GmbH, Siershahn                            Germany, registered with the local court Montabaur under HRB 6481
KCH Beteiligungs GmbH, Siershahn                      Germany, registered with the local court Montabaur under HRB 6169
SGL TECHNOLOGIES GmbH, Meitingen                      Germany, registered with the local court Augsburg under HRB 18142
SGL Brakes GmbH, Meitingen                            Germany, registered with the local court Augsburg under HRB 18592
SGL CARBON S.p.A, Milan                               Italy
SGL CARBON S.A., La Coruna                            Spain
SGL CARBON LLC, Nevada                                USA
SGL CARBON GmbH, Steeg                                Austria

                                      137

<PAGE>


SGL CARBON GmbH & Co KG, Steeg                        Austria
RK Carbon International Ltd., Wilmslow                England
RK Technologies International Ltd., Wilmslow          UK/England
SGL TECHNIC Ltd., Muir of Ord                         UK/Scotland
SGL CARBON S.A.S., Chedde                             France
SGL ACOTEC SAS, Grenoble                              France
RADION FINANZIARIA S.p.A., Milan                      Italy
SGL CANADA Inc., Lachute                              Canada
SGL Carbon Polska S.A.(formerly "ZEW S.A., Raciborz") Poland
SGL TECHNIC Inc., Valencia                            USA
</TABLE>


                                      138

<PAGE>

                                    PART II

                             THE ORIGINAL LENDERS



<TABLE>
<CAPTION>
NAME OF ORIGINAL LENDER                                                  TERM          TERM          TERM       REVOLVING CREDIT
                                                                      FACILITY A    FACILITY B    FACILITY C  FACILITY COMMITMENT
                                                                      COMMITMENT    COMMITMENT    COMMITMENT
<S>                                                                      <C>           <C>            <C>            <C>
MANDATED LEAD ARRANGERS
BAYERISCHE LANDESBANK                                                 4,600,000     36,500,000        -            11,900,000
CREDIT SUISSE FIRST BOSTON INTERNATIONAL                              1,800,000     14,600,000        -             5,600,000
DRESDNER KLEINWORT WASSERSTEIN, THE INVESTMENT BANKING DIVISION OF        -             -             -                 -
DRESDNER BANK AG
DEUTSCHE BANK AG                                                          -             -             -                 -

LENDERS
COMMERZBANK AKTIENGESELLSCHAFT                                        2,100,000     16,600,000        -             5,300,000
DRESDNER BANK AG IN MUNCHEN                                        2,700,000     21,200,000        -             8,100,000
DEUTSCHE BANK LUXEMBOURG S.A.                                         2,700,000     21,200,000        -             8,100,000
BAYERISCHE HYPO- UND VEREINSBANK                                          -         20,000,000        -                 -
KREDITANSTALT FUR WIEDERAUFBAU                                    10,000,000         -         20,000,000            -
DZ BANK                                                               1,100,000      9,900,000        -             3,000,000

TOTAL                                                             [e]25,000,000 [e]140,000,000 [e]20,000,000    [e]42,000,000
</TABLE>


                                      139

<PAGE>


                                  SCHEDULE 2

                CONDITIONS PRECEDENT AND CONDITIONS SUBSEQUENT


                                    PART 0
          CONDITIONS PRECEDENT TO EFFECTIVENESS OF FINANCE DOCUMENTS


Each of the following original documents duly executed  by  all  of the parties
thereto  (other  than  The  Bank  of  New  York  as  trustee for the High Yield
Investors and the holders of the Convertible Bonds):

(a)   this Agreement;

(b)   the US Term Loan Agreement;

(c)   the Intercreditor Agreement;

(d)   the Security Trust Agreement; and

(e)   each Fee Letter.




                                    PART I
                  CONDITIONS PRECEDENT TO INITIAL UTILISATION

1.    CORPORATE DOCUMENTS

(a)   A copy of the  constitutional  documents of each Original  Obligor and of
      SGL Technologies North America Corp. in the form required by the Facility
      Agent  (i.e.  in  relation  to (1)  USA,  Certificate  of  Incorporation,
      Articles of Incorporation  or Articles of  Organisation,  as appropriate;
      By-Laws  or  Operating   Agreement,   as   appropriate;   Good   Standing
      Certificate; (2) ITALY, Articles of Association (atto costitutivo),  most
      recent  by-laws   (statuto  in  vigore);   certificate  of   registration
      (certificato  di  iscrizione)  issued  by the  Registrar  of  Enterprises
      (Registro delle Imprese) of the competent  Chamber of Commerce (Camera di
      Commercio);    (3)   SPAIN,   Deed   of   Incorporation   (escritura   de
      constitucion)   and  any   amendments   to  the   original   By-  laws
      (modificaciones  a  los  estatutos   originales);   certified  commercial
      register excerpt (certificacion del Registro Mercantil);  (4) AUSTRIA,
      Articles  of   Association   (Satzung);   commercial   registry   excerpt
      (Handelsregisterauszug);  (5) ENGLAND,  Certificate of  Incorporation  or
      Certificate   of   Incorporation   on  Change  of  Name,   Memorandum  of
      Association,   Articles  of   Association;   (6)   SCOTLAND,   Directors'
      Resolution,  Certificate  of  Incorporation,  Memorandum of  Association,
      Articles of Association;  (7) FRANCE, Articles of Association and by-laws
      (Statuts),  register  excerpt  (register des  mouvements de titres);  (8)
      POLAND,  Articles  of  Association,   Excerpt  from  the  National  Court
      Register;  (9)  CANADA,  Articles  of  Incorporation,  By-Laws;  and (11)
      including  in  relation  to a German  Obligor  an  up-to-date  officially
      certified       commercial      register      extract       (beglaubigter
      Handelsregisterauszug) and the articles of association (Satzung)).

(b)   A copy of a resolution of the  shareholders  (or the equivalent  thereof,
      i.e. in relation to (1) USA, a Board of Directors' Resolution; (2) ITALY,
      a  Board  of   Directors`   Resolution

                                      140

<PAGE>

      (Delibera del  Consiglio di  Amministrazione);  (3) SPAIN,  Minutes of the
      Shareholders  Meeting (acta de la Junta de Accionistas) and minutes of the
      Board  of   Directors   Meeting   (acta  de  la  reunion  del  Consejo  de
      Administracion);      (4)      GERMANY,      Shareholder's      Resolution
      (Gesellschafterbeschluss);    (5)   AUSTRIA,    Shareholder`s   Resolution
      (Gesellschafterbeschluss);    (6)    ENGLAND,    Director's    Resolution,
      Shareholders`  Resolution;  (7) SCOTLAND,  Shareholders`  Resolution;  (8)
      FRANCE,  Shareholder's  Resolution (decision de l'associe unique) or board
      resolution (process verbal du conseil  d'administration),  as appropriate;
      (9)  POLAND,   Shareholder`s  Resolution;   and  (10)  CANADA,  Directors'
      Resolution; Shareholder's Resolution)

      (i)   approving the terms of, and the transactions  contemplated  by, the
            Finance  Documents  to  which  it  is a party and resolving that it
            executes the Finance Documents to which it is a party;

      (ii)  authorising a specified person or persons  to  execute  the Finance
            Documents to which it is a party on its behalf; and

      (iii) authorising a specified person or persons, on its behalf,  to  sign
            and/or  despatch all documents and notices (including, if relevant,
            any Utilisation  Request  and Selection Notice) to be signed and/or
            despatched by it under or in  connection with the Finance Documents
            to which it is a party.

(c)   A specimen of the signature of each person  authorised  by the resolution
      referred to in paragraph (b) above.

(d)   A  certificate  of the Company (signed by a director or other  authorised
      officer) confirming  that  borrowing or guaranteeing, as appropriate, the
      Total Commitments would not  cause  a  violation  of  any contract of any
      Original Obligor.

(e)   A copy of the constitutional documents of each Group Member  whose shares
      are  subject to Security under any of the Security Documents referred  to
      in Part I of this Schedule 2 in the form required by the Facility Agent.

(f)   A certificate  of  an  authorised  signatory  of  each  Original  Obligor
      certifying  that to the best of its knowledge each copy document relating
      to it specified in this paragraph 1 is correct, complete and has not been
      amended as at a date no earlier than the Signing Date.

2.    TRANSACTION SECURITY DOCUMENTS

Each of the following  documents  in  form  and  substance  satisfactory to the
Security Agent duly executed by all the parties thereto:

(a)   release of each of the following share pledge agreements and notarization
      of new first ranking  share  pledges in favour of the Security  Agent and
      the Senior Lenders:

      (i)    GmbH  Share Pledge Agreement dated 20 December  2002  between  SGL
             Carbon  AG  as  Pledgor, Deutsche Bank Luxembourg S.A. as Security
             Agent and other Pledgees  relating  to  the  shares  in SGL Carbon
             Beteiligung  GmbH,  SGL  ACOTEC  GmbH,  SGL  Carbon  GmbH and  SGL
             Technologies GmbH;

      (ii)   GmbH  Share  Pledge  Agreement dated 20 December 2002 between  SGL
             ACOTEC GmbH as Pledgor,  Deutsche Bank Luxembourg S.A. as Security
             Agent  and  other  Pledgees  relating   to   the   shares  in  KCH
             Beteiligungs GmbH; and

                                      141

<PAGE>



      (iii)  GmbH  Share  Pledge  Agreement dated 20 December 2002 between  SGL
             Technologies GmbH as Pledgor,  Deutsche  Bank  Luxembourg  S.A. as
             Security  Agent  and other Pledgees relating to the shares in  SGL
             Brakes GmbH;

(b)   release of each of the following share pledge agreements and notarization
      of new first  ranking  pledges  in favour of the  Security  Agent and the
      Senior Lenders:

      (i)    Poliza de Prenda de Acciones/ Deed of Pledge  of Shares dated 5
             May  2003  between  SGL  Carbon  Beteiligung  GmbH as Pledgor  and
             Deutsche Bank Luxembourg S.A. as Security Agent  relating  to  the
             shares in SGL Carbon S.A. (Spain);

      (ii)   Membership  Interest Pledge Agreement dated 1 May 2003 between SGL
             Carbon Beteiligung  GmbH  as  Pledgor and Deutsche Bank Luxembourg
             S.A. as Security Agent relating  to  the shares in SGL Carbon, LLC
             (USA);

      (iii)  Stock Pledge Agreement dated 1 May 2003  between  SGL Technologies
             North  America Corp. as Pledgor and Deutsche Bank Luxembourg  S.A.
             as Security  Agent  relating  to  the  shares in SGL Technic, Inc.
             (USA);

      (iv)   Share Pledge Agreement dated 2 May 2003  between  SGL Carbon AG as
             Pledgor,  Deutsche  Bank  Luxembourg  S.A. as Security  Agent  and
             certain other pledgees as Pledgees relating  to  the shares in SGL
             Carbon GmbH & Co. KG (Austria);

      (v)    Agreement for the Establishment of a Registered Pledge  on  Shares
             dated  17  March  2003  between SGL Carbon Holdings B.V. (as legal
             successor  of  SGL  Carbon  AG)   as  Pledgor  and  Deutsche  Bank
             Luxembourg S.A. as Pledgee relating  to  the  shares in SGL Carbon
             Polska (formerly "Zaklady Elektrod Weglowych S.A.") (Parallel Debt
             I);

      (vi)   Agreement for the Establishment of a Registered  Pledge  on Shares
             dated  17  March  2003  between SGL Carbon Holdings B.V. (as legal
             successor  of  SGL  Carbon  AG)   as  Pledgor  and  Deutsche  Bank
             Luxembourg S.A. as Pledgee relating  to  the  shares in SGL Carbon
             Polska (formerly "Zaklady Elektrod Weglowych S.A.") (Parallel Debt
             II);

      (vii)  Pledge  over  Shares of an S.p.A. dated 30 June 2003  between  SGL
             Carbon Beteiligung  GmbH and Radion Finanziaria S.p.A. as Pledgors
             and Deutsche Bank Luxembourg  S.A.  as  Security Agent relating to
             the shares in SGL Carbon S.p.A.;

      (viii) Share  Account Pledge Agreement dated 29 April  2003  between  SGL
             Carbon AG  as  Pledgor,  Deutsche Bank Luxembourg S.A. as Security
             Agent relating to the shares in SGL Carbon S.A.S.; and

      (ix)   Share Account Pledge Agreement  dated 19 November 2003 between KCH
             Beteiligungs GmbH as Pledgor and  Deutsche Bank Luxembourg S.A. as
             Security Agent relating to the shares in SGL Acotec S.A.S.

                                      142

<PAGE>


(c)   release of each of the following  account pledge  agreements and granting
      of new first ranking  account pledges in favour of the Security Agent and
      the Senior Lenders:

      (i)    Account Pledge Agreement dated 20 December 2002 between SGL Carbon
             AG as Pledgor  and Deutsche Bank Luxembourg S.A. as Security Agent
             and certain other pledgees as Pledgees;

      (ii)   Account Pledge Agreement dated 20 December 2002 between SGL Brakes
             GmbH as Pledgor  and  Deutsche  Bank  Luxembourg  S.A. as Security
             Agent and certain other pledgees as Pledgees;

      (iii)  Account  Pledge  Agreement  dated  20  December  2002 between  SGL
             Technologies GmbH as Pledgor and Deutsche Bank Luxembourg  S.A. as
             Security Agent and certain other pledgees as Pledgees;

      (iv)   Account Pledge Agreement dated 20 December 2002 between SGL ACOTEC
             GmbH  as  Pledgor  and  Deutsche  Bank Luxembourg S.A. as Security
             Agent and certain other pledgees as Pledgees;

      (v)    Account Pledge Agreement dated 20 December 2002 between SGL Carbon
             GmbH  as  Pledgor and Deutsche Bank Luxembourg  S.A.  as  Security
             Agent and certain other pledgees as Pledgees;

      (vi)   Account Pledge Agreement dated 20 December 2002 between SGL Carbon
             Beteiligung  GmbH  as Pledgor and Deutsche Bank Luxembourg S.A. as
             Security Agent and certain other pledgees as Pledgees; and

      (vii)  Account  Pledge Agreement  dated  20  December  2002  between  KCH
             Beteiligungs  GmbH as Pledgor and Deutsche Bank Luxembourg S.A. as
             Security Agent and certain other pledgees as Pledgees.

(d)   an  amendment  agreement  relating  to  each  of the  following  security
      documents according to which the respective security will cease to secure
      the obligations  under the Original Finance  Documents and will forthwith
      serve as security for the Obligors'  obligations under this Agreement and
      under the other Finance Documents:

      (i)   Security Assignment of Receivables dated  20  December 2002 between
            SGL  Carbon  AG  as Assignor and Deutsche Bank Luxembourg  S.A.  as
            Security Agent;

      (ii)  Security Assignment  of  Receivables dated 20 December 2002 between
            SGL Brakes GmbH as Assignor  and  Deutsche  Bank Luxembourg S.A. as
            Security Agent;

      (iii) Security Assignment of Receivables dated 20 December  2002  between
            SGL Technologies GmbH as Assignor and Deutsche Bank Luxembourg S.A.
            as Security Agent;

      (iv)  Security  Assignment  of Receivables dated 20 December 2002 between
            SGL ACOTEC GmbH as Assignor  and  Deutsche  Bank Luxembourg S.A. as
            Security Agent;

                                      143

<PAGE>


      (v)   Security Assignment of Receivables dated 20 December  2002  between
            SGL  Carbon  GmbH as Assignor and Deutsche Bank Luxembourg S.A.  as
            Security Agent;

      (vi)  Security Assignment  of  Receivables dated 20 December 2002 between
            SGL  Carbon  Beteiligung  GmbH   as   Assignor  and  Deutsche  Bank
            Luxembourg S.A. as Security Agent;

      (vii) Security Assignment of Receivables dated  20  December 2002 between
            KCH Beteiligungs GmbH as Assignor and Deutsche Bank Luxembourg S.A.
            as Security Agent;

      (viii)Assignment of IP-Rights dated 20 December 2002  between  SGL Carbon
            AG as Assignor and Deutsche Bank Luxembourg S.A. as Security Agent;

      (ix)  Assignment  of IP-Rights dated 20 December 2002 between SGL  Brakes
            GmbH as Assignor  and  Deutsche  Bank  Luxembourg  S.A. as Security
            Agent;

      (x)   Assignment  of  IP-Rights  dated  20  December  2002  between   SGL
            Technologies  GmbH as Assignor and Deutsche Bank Luxembourg S.A. as
            Security Agent;

      (xi)  Assignment of IP-Rights  dated  20 December 2002 between SGL ACOTEC
            GmbH  as Assignor and Deutsche Bank  Luxembourg  S.A.  as  Security
            Agent;

      (xii) Assignment  of  IP-Rights dated 20 December 2002 between SGL Carbon
            GmbH as Assignor  and  Deutsche  Bank  Luxembourg  S.A. as Security
            Agent;

      (xiii)Assignment of IP-Rights dated 20 December 2002 between  SGL  Carbon
            Beteiligung  GmbH as Assignor and Deutsche Bank Luxembourg S.A.  as
            Security Agent;

      (xiv) Assignment  of   IP-Rights  dated  20  December  2002  between  KCH
            Beteiligungs GmbH  as Assignor and Deutsche Bank Luxembourg S.A. as
            Security Agent;

      (xv)  Security Transfer of Equipment and Inventory dated 20 December 2002
            between SGL Brakes GmbH  as Transferor and Deutsche Bank Luxembourg
            S.A. as Security Agent, as amended;

      (xvi) Security Transfer of Equipment and Inventory dated 20 December 2002
            between  SGL Technologies GmbH  as  Transferor  and  Deutsche  Bank
            Luxembourg S.A. as Security Agent, as amended;

      (xvii)Security Transfer of Equipment and Inventory dated 20 December 2002
            between SGL  ACOTEC GmbH as Transferor and Deutsche Bank Luxembourg
            S.A. as Security Agent, as amended;

      (xviii)Security Transfer  of  Equipment  and  Inventory dated 20 December
            2002  between  SGL  Carbon  GmbH as Transferor  and  Deutsche  Bank
            Luxembourg S.A. as Security Agent, as amended;

      (xix) Security  Purpose  Agreement relating  to  Land  Charges  dated  23
            December 2002 between  -  inter alia - SGL Carbon AG as Chargor and
            Deutsche Bank

                                      144

<PAGE>

            Luxembourg  S.A.  as  Security  Agent,  relating  to  Land  charges
            (Grundschuldbestellung)  by   SGL   Carbon  AG  dated  23  December
            2002, as amended 28 November 2003 and the  Submission  to Immediate
            Foreclosure  (Zwangsvollstreckungsunterwerfung)  relating  to  Land
            Charges by SGL Carbon AG dated 23 December 2002; and

      (xx)  Security Purpose  Agreement  relating to Land Charges dated 5 August
            2003 between SGL Acotec GmbH as Chargor and Deutsche Bank Luxembourg
            S.A.  as  Security  Agent,  relating  to  the  Assignment  Agreement
            (Abtretungserklarung) by SGL Acotec GmbH dated 5 August 2003 and the
            Land  Charges  (Grundschuldbestellung)  by SGL  Acotec  GmbH dated 5
            August 2003;

(e)   a first  ranking  pledge in favour of the  Security  Agent and the Senior
      Lenders over

      (i)    the Cartel Deposit Account; and

      (ii)   the Convert Deposit Account; and

(f)   execution of the Security Trust Agreement and the Intercreditor Agreement
      by The Bank of New York as trustee for the High Yield Investors  and  the
      holders of the Convertible Bonds.


3.    OTHER DOCUMENTS

Each  of  the  following original documents duly executed by all of the parties
thereto:

(a)   the Release Agreement;

(b)   the Group Structure Chart showing all the Intra-Group Loans and all Group
      Members and a completion of funds flow statement;

(c)   the Base Financial Statements; and

(d)   certified copy of the application to the relevant  commercial  registry of
      the  implementation  (Durchfuhrung)  of the capital increase in connection
      with the Rights Issue.



4.    LEGAL OPINIONS

(a)   Legal  opinions  of (i)  Shearman &  Sterling,  Germany,  counsels  to the
      Company in Germany, (ii) Parker, Poe, Adams & Bernstein L.L.P., Charlotte,
      North  Carolina/USA,  US legal  counsel,  (iii) Bonelli Erede  Pappalardo,
      Studio Legale,  Milano,  Italy,  Italian legal counsel,  (iv) Uria, Spain,
      Spanish legal counsel,  (v) Saxinger  Chalupsky Weber & Partner,  Austria,
      Austrian legal counsel, (vi) Ogilvy Renault, Canada, Quebec legal counsel,
      (vii) Hammonds,  England,  English legal counsel,  (viii) Soffal,  France,
      French legal counsel,  (ix) Domanski  Zakrzewski Palinka,  Poland,  Polish
      legal counsel, (x) Ledingham Chalmers,  Scotland,  Scottish legal counsel,
      (xi)  Faasen &  Partners,  The  Netherlands,  Dutch  legal  counsel,  each
      addressed to the Secured Parties confirming that the Company and the other
      Group Members are duly  organised and validly  existing and confirming the
      capacity and  authorisation  of the Company and the other Group Members to
      enter into the Finance Documents in form and substance satisfactory to the
      Facility Agent;

                                      145

<PAGE>



(b)   a letter from Shearman & Sterling, USA, US legal advisers to the Company,
      dated on or about the Signing  Date  with  respect  to  certain antitrust
      matters addressed to the Secured Parties, in the form distributed  to the
      Original Lenders prior to signing this Agreement;

(c)   Legal  opinions  of  Baker  &  McKenzie, legal counsel in Germany, Spain,
      Austria, Poland, France, Italy and  the USA, and Oostvogels & De Meester,
      legal  counsel  in  Luxembourg,  each  addressed  to  the  Mandated  Lead
      Arrangers, the Documentation Agent, the  Security  Agent and the Facility
      Agent,  substantially  in  the form distributed to the  Original  Lenders
      prior to signing this Agreement; and

(d)   a Legal opinion of Cravath,  Swaine & Moore, US legal advisers, addressed
      to the Mandated Lead Arrangers,  the  Documentation  Agent,  the Security
      Agent  and  the  Facility  Agent,  regarding the Intercreditor Agreement,
      substantially in the form distributed  to  the  Original Lenders prior to
      signing this Agreement.


5.    OTHER DOCUMENTS AND EVIDENCE

(a)   Evidence that the Existing Indebtedness (save for  the Original Letter of
      Credit and Permitted Indebtedness) has been (or will  simultaneously with
      the initial Utilisation) repaid or prepaid in full and all Security other
      than  the  Security  referred to in Part II of this Schedule  2  relating
      thereto has been released.

(b)   Evidence that the fees,  costs  and  expenses  then  due from the Company
      pursuant to Clause 13 (Fees) and Clause 18 (Costs and Expenses) have been
      paid or will be paid by the first Utilisation Date.

(c)   Evidence  that  the Minimum Guarantor Coverage pursuant  to  Clause  22.5
      (Minimum Guarantor  Coverage)  amounts  to  at least eighty-five (85) per
      cent. of the Consolidated EBITDA and/or turnover of the Group.

(d)   If an Original Obligor is incorporated in a jurisdiction  other  than the
      Federal Republic of Germany, evidence that the process agent specified in
      Clause 40.2 (Service of Process) has accepted its appointment in relation
      to that Original Obligor.

(e)   A  certificate  of  the Company (signed by a director or other authorised
      officer, and in case  of  para.  (ii)  to (v) below, together with a bank
      certificate) confirming that:

      (i)    no Material Adverse Change has occurred;

      (ii)   the Company  has  received  not less than [e] 266,000,000 in gross
             cash proceeds from the Rights Issue;

      (iii)  the Company  has  received  not less than [e] 270,000,000 in gross
             cash proceeds from the Bridge Loan or the High Yield Notes;

      (iv)   the Company has irrevocably deposited not less than [e]125,300,000
             into the Cartel Deposit Account; and

      (v)    the Company has irrevocably deposited an amount sufficient to fund
             principal and interest (through maturity)  of the Convertible Bond
             into the Convert Deposit Account, not less than [e]143,000,000,

                                      146

<PAGE>


      provided that the requirements pursuant to para. (ii)  to (v) above shall
      also  be  fulfilled  if  such  amounts are funded concurrently  with  the
      initial Utilisation herunder.


                                      147

<PAGE>


                                    PART II

                 CONDITIONS SUBSEQUENT TO INITIAL UTILISATION

      The Company shall ensure that no  later  than  31  March 2004, all of the
      documents  and  other  evidence  listed  in this Part II  of  Schedule  2
      (Conditions Subsequent and Conditions Subsequent)  shall  be delivered to
      the  Facility  Agent,  each  in  form and substance satisfactory  to  the
      Security Agent:


      1.     AUSTRIA

      Release of the Share Pledge Agreement dated 2 May 2003 between SGL Carbon
      AG  as  Pledgor, Deutsche Bank Luxembourg  S.A.  as  Security  Agent  and
      certain other  pledgees  as Pledgees relating to the shares in SGL Carbon
      GmbH (Austria) and granting of a new first ranking share pledge.


      2.     SCOTLAND

      Execution of the following  documents  in connection with the release and
      regranting of the
      Share  Pledge  Agreement  dated  29 April 2003  between  RK  Technologies
      International  Ltd.  as Pledgor and  Deutsche  Bank  Luxembourg  S.A.  as
      Security Agent relating to the shares in SGL Technic Ltd.:

      (i)   a deed of release  in  relation to the share pledge agreement dated
            29  April 2003 between RK  Technologies  International  Limited  as
            Pledgor  and Deutsche Bank Luxembourg S.A. as agent relating to the
            shares in SGL Technic Limited together with a Form 403a in relation
            thereto;

      (ii)  an executed  stock  transfer  form  transferring  the shares in SGL
            Technic Limited from Deutsche Bank Luxembourg S.A.  or  its nominee
            to  RK Technologies International Limited and share certificate  in
            the name of RK Technologies International Limited;

      (iii) an  amended   share   pledge   agreement  between  RK  Technologies
            International Limited as Pledgor  and Deutsche Bank Luxembourg S.A.
            as agent relating to the shares in  SGL  Technic  Limited  together
            with a Form 395 in relation thereto;

      (iv)  an  executed  stock  transfer  form  transferring the shares in SGL
            Technic  Limited  from  RK  Technologies International  Limited  to
            Deutsche Bank Luxembourg S.A.  or its nominee and share certificate
            in the name of Deutsche Bank Luxembourg S.A. or its nominee; and

      (v)   a copy of the register of members  of  SGL  Technic Limited showing
            Deutsche Bank Luxembourg S.A. or its nominee  as  a  member  of SGL
            Technic Limited.


      3.     ITALY

      Release  of  each  of the following existing Security and granting of new
      first ranking Security in respect of the following:

                                      148

<PAGE>


      (i)   Pledge over Shares  of  an  S.p.A.  dated  30 June 2003 between SGL
            Carbon  Beteiligung  GmbH as Pledgor and Deutsche  Bank  Luxembourg
            S.A. as Security Agent relating to the shares in Radion Finanziaria
            S.p.A.;

      (ii)  Pledge over Bank Account  Credit Balance dated 30 June 2003 between
            Radion Finanziaria S.p.A. as  Pledgor  and Deutsche Bank Luxembourg
            S.A. as Security Agent;

      (iii) Pledge over Bank Account Credit Balance  dated 30 June 2003 between
            SGL Carbon S.p.A. as Pledgor and Deutsche  Bank  Luxembourg S.A. as
            Security Agent;

      (iv)  Assignment  of Receivables by Way of Security dated  30  June  2003
            between Radion  Finanziaria  S.p.A.  as  Assignor and Deutsche Bank
            Luxembourg S.A. as Security Agent;

      (v)   Assignment of Receivables by Way of Security  dated  30  June  2003
            between  SGL Carbon S.P.A. as Assignor and Deutsche Bank Luxembourg
            S.A. as Security Agent;

      (vi)  Agreement  for  the  Creation  of  a  Pledge over Future Registered
            Patents   and  Trademarks  dated  30  June  2003   between   Radion
            Finanziaria  S.p.A.  and  Deutsche Bank Luxembourg S.A. as Security
            Agent; and

      (vii) Agreement for the Creation  of  a  Pledge  over  Future  Registered
            Patents and Trademarks dated 30 June 2003 between SGL Carbon S.p.A.
            and Deutsche Bank Luxembourg S.A. as Security Agent.


      4.     USA

      Release  of each of the following existing Security and granting  of  new
      first ranking  Security  in respect of the following (other than relating
      to the mortgages over the  real  estate  in  Niagara Falls, New York, and
      Pennsylvania):

      (i)   Stock Pledge Agreement dated 1 May 2003  between SGL Carbon, LLC as
            Pledgor  and  Deutsche  Bank  Luxembourg  S.A.  as  Security  Agent
            relating  to  the shares in SGL Technologies  North  America  Corp.
            (formerly SGL Hitco Acquisition Corp.);

      (ii)  Stock Pledge Agreement  dated  1  May 2003 between KCH Beteiligungs
            GmbH as Pledgor and Deutsche Bank Luxembourg S.A. as Security Agent
            relating to the shares in SGL Acotec, Inc.;

      (iii) Mortgage, Security Agreement and Fixture  Filing  dated 20 May 2003
            made  by  SGL  Carbon,  LLC as Mortgagor in favor of Deutsche  Bank
            Luxembourg S.A. as Security Agent and Mortgagee;

      (iv)  Open-End Mortgage, Security  Agreement  and Fixture Filing dated 13
            May 2003 made by SGL Carbon, LLC as Mortgagor  in favor of Deutsche
            Bank  Luxembourg S.A. as Security Agent and Mortgagee  relating  to
            the Securing of Future Advances;

      (v)   Deed of  Trust,  Security Agreement and Fixture Filing dated 13 May
            2003 made by SGL Carbon,  LLC  as Grantor in favor of Deutsche Bank
            Luxembourg  S.A. as

                                      149

<PAGE>

            Security Agent  relating  to  the  Securing of Obligations Advances
            for Commercial Purposes;

      (vi)  Deed of Trust,  Security  Agreement and Fixture Filing dated 13 May
            2003 made by SGL Carbon, LLC  as  Grantor in favor of Deutsche Bank
            Luxembourg S.A. as Security Agent relating  to real property in the
            city of Charlotte, Mecklenburg County, North Carolina;

      (vii) Deed of Trust, Security Agreement and Fixture  Filing  dated 13 May
            2003  made by SGL Carbon, LLC as Grantor in favor of Deutsche  Bank
            Luxembourg  S.A. as Security Agent relating to real property in the
            city of Morganton, Burke County, North Carolina;

      (viii)Mortgage, Security  Agreement  and Fixture Filing dated 13 May 2003
            made by SGL Carbon, LLC as Mortgagor  in  favor  of  Deutsche  Bank
            Luxembourg S.A. as Security Agent;

      (ix)  Line of Credit Deed of Trust, Security Agreement and Fixture Filing
            dated  13  May  2003 made by SGL Carbon, LLC as Grantor in favor of
            Deutsche Bank Luxembourg S.A. as Security Agent;

      (x)   Deed of Trust, Security  Agreement  and  Fixture Filing dated 9 May
            2003 made by SGL Technic, Inc. as Grantor in favor of Deutsche Bank
            Luxembourg S.A. as Security Agent;

      (xi)  Environmental Indemnity Agreement dated 16  May  2003  between  SGL
            Carbon,  LLC and Deutsche Bank Luxembourg S.A. as Security Agent in
            relation to  real  property  located  in the States of Kentucky and
            North Carolina;

      (xii) Environmental Indemnity Agreement dated  19  May  2003  between SGL
            Carbon, LLC and Deutsche Bank Luxembourg S.A. as Security  Agent in
            relation to real property located in the States of Arkansas, Oregon
            and Pennsylvania;

      (xiii)Environmental  Indemnity  Agreement  dated 20 May 2003 between  SGL
            Carbon, LLC and Deutsche Bank Luxembourg  S.A. as Security Agent in
            relation  to  real  property  located  in the States  of  Arkansas,
            Kentucky, North Carolina, New York, Oregon and Pennsylvania;

      (xiv) Environmental Indemnity Agreement dated  19  May  2003  between SGL
            Technic,  Inc. and Deutsche Bank Luxembourg S.A. as Security  Agent
            in relation to real property located in the State of California;

      (xv)  Security Agreement  dated  1  May  2003  between SGL Carbon, LLC as
            Grantor and Deutsche Bank Luxembourg S.A. as Security Agent;

      (xvi) Security Agreement dated 1 May 2003 between  SGL  Technic,  Inc. as
            Grantor and Deutsche Bank Luxembourg S.A. as Security Agent;

      (xvii)Security Agreement dated 1 May 2003 between SGL Technologies  North
            America  Corp.  as  Grantor  and  Deutsche  Bank Luxembourg S.A. as
            Security Agent;

                                      150

<PAGE>



    (xviii) Intellectual Property Security Agreement dated  1 May 2003 made by
            SGL  Carbon,  LLC  in  favor  of Deutsche Bank Luxembourg  S.A.  as
            Security Agent;

      (xix) Intellectual Property Security  Agreement  dated 1 May 2003 between
            SGL  Technic,  Inc. in favor of Deutsche Bank  Luxembourg  S.A.  as
            Security Agent;

      (xx)  Blocked Account  Agreement dated 6 May 2003 between SGL Carbon, LLC
            and SGL Technic, Inc.  as account holders, Deutsche Bank Luxembourg
            S.A. as Security Agent and Bank of America, N.A. as Bank;

      (xxi) Deposit Account Control  Agreement  dated  6  May  2003 between SGL
            Carbon, LLC and SGL Technic, Inc. as account holders, Deutsche Bank
            Luxembourg S.A. as Security Agent and Bank of America, N.A. as Bank


      5.     CANADA

      Release  of each of the following existing Security and granting  of  new
      first ranking Security in respect of the following:

      (i)   Appointment  of  "Fonde  de  Pouvoir"  dated  7 May 2003 between
            Deutsche  Bank  Luxembourg  S.A.  as  Security Agent in  favour  of
            Computershare Trust Company of Canada as the Trust;

      (ii)  Deed of Hypotec dated 7 May 2003 between  SGL  Carbon AG as Grantor
            and Computershare Trust Company of Canada as Agent;

      (iii) Debenture  dated 7 May 2003 between SGL Carbon AG  as  Grantor  and
            Computershare Trust Company of Canada as Agent;

      (iv)  Hypothec of  Debenture  dated  7  May 2003 between SGL Carbon AG as
            Grantor and Deutsche Bank Luxembourg S.A. as Security Agent; and

      (v)   Delivery Order dated 7 May 2003 by Deutsche Bank Luxembourg S.A. to
            Computershare Trust Company of Canada.


      6.     OTHER DOCUMENTS

      (a)   A copy of the constitutional documents  of  each Group Member whose
            shares are subject to Security under any of the  Security Documents
            referred to in this Part II of this Schedule 2 in the form required
            by  the  Facility  Agent, including but not limited to,  any  stock
            transfer form and share  certificates,  and,  in case of SGL Carbon
            LLC,  the  amendment  to  its  operating agreement reflecting  that
            Article 8 of the Uniform Commercial  Code  will apply to SGL Carbon
            LLC; and

      (b)   The  agreements relating to the offer to purchase  the  Convertible
            Bonds (including, without limitation, a dealer manager agreement).


      7.     LEGAL OPINIONS

      In relation  to each of the documents set out in this Part II of Schedule
      2:

                                      151

<PAGE>


      (a)   Legal opinions of (i) Shearman & Sterling, Germany, counsels to the
            Company  in  Germany,  (ii)  Parker, Poe, Adams & Bernstein L.L.P.,
            Charlotte, North Carolina/USA,  US  legal  counsel,  (iii)  Bonelli
            Erede  Pappalardo,  Studio  Legale,  Milano,  Italy,  Italian legal
            counsel, (iv) Saxinger Chalupsky Weber & Partner, Austria, Austrian
            legal  counsel, (v) Hammonds, England, English legal counsel,  (vi)
            Ogilvy Renault,  Canada,  Quebec legal counsel, and (vii) Ledingham
            Chalmers, Scotland, Scottish  legal  counsel, each addressed to the
            Secured Parties confirming that the Company  and  the  other  Group
            Members are duly organised and validly existing and confirming  the
            capacity  and  authorisation  of  the  Company  and the other Group
            Members to enter into the Finance Documents in form  and  substance
            satisfactory to the Facility Agent.

      (b)   Legal  opinions  of  (i)  Maclay Murray & Spens, Scotland, Scottish
            legal  counsel,  (ii) Lapointe  Rosenstein,  Canada,  Quebec  legal
            counsel, (iii) Oostvogels  &  De  Meester,  Luxembourg,  Luxembourg
            counsel, and (iv) Baker & McKenzie, legal counsel in Austria, Italy
            and  the  USA,  each addressed to the Mandated Lead Arrangers,  the
            Documentation Agent,  the  Security  Agent  and the Facility Agent,
            substantially in the form distributed to the Original Lenders prior
            to signing this Agreement.


                                      152

<PAGE>



                                   PART III

CONDITIONS PRECEDENT REQUIRED TO BE DELIVERED BY A PROPOSED ADDITIONAL OBLIGOR

1.    An Accession Letter, duly executed by the proposed Additional Obligor and
      the  Company  (and  subject  to appropriate Guarantee limitation  wording
      relating  to  the  respective  Additional   Obligor   in  case  of  legal
      restrictions and potential officer's liability).

2.    A copy of the constitutional documents of the proposed Additional Obligor
      in the form reasonably required by the Facility Agent.

3.    A copy of a resolution of the shareholders and/or board  of directors (or
      the equivalent thereof) of the proposed Additional Obligor:

      (a)    approving the terms of, and the transactions contemplated  by, the
             Accession  Letter and the Finance Documents and resolving that  it
             execute the Accession Letter;

      (b)    authorising a specified person or persons to execute the Accession
             Letter on its behalf; and

      (c)    authorising  a specified person or persons, on its behalf, to sign
             and/or despatch  all  other  documents  and notices (including, in
             relation  to  a  proposed  Additional  Borrower,  any  Utilisation
             Request or Selection Notice) to be signed  and/or despatched by it
             under or in connection with the Finance Documents.

4.    A specimen of the signature of each person authorised  by  the resolution
      referred to in paragraph 3 above.

5.    Where  the  Lenders  determine  such to be either necessary or desirable,
      either  in place of or in addition  to  the  resolution  referred  to  in
      paragraph  3  above,  a  certificate  or extract from a public commercial
      registry or equivalent evidence setting  out  the names and signatures of
      the persons authorised to execute the Accession  Letter  on behalf of the
      proposed Additional Obligor and to sign and/or despatch all documents and
      notices  (including,  if relevant, any Utilisation Request and  Selection
      Notice) to be signed and/or  despatched by it under or in connection with
      the Finance Documents.

6.    A certificate of the proposed Additional Obligor (signed by a director or
      other authorised officer) confirming  that  borrowing or guaranteeing, as
      appropriate,  the  Total  Commitments  would  not  cause  any  borrowing,
      guaranteeing or similar limit binding on it to be exceeded.

7.    A  certificate  of  an  authorised signatory of the  proposed  Additional
      Obligor certifying that each  copy  document  listed  in  this Part IV of
      Schedule 2 is correct, complete and in full force and effect as at a date
      no earlier than the date of the Accession Letter.

8.    A  copy  of any other Authorisation or other document which the  Facility
      Agent considers to be necessary or desirable in connection with the entry
      into and performance  of  the  transactions contemplated by the Accession
      Letter or for the validity and enforceability of any Finance Document.

9.    If available, the latest audited  financial  statements  of  the proposed
      Additional Obligor.

10.   A legal opinion of Baker & McKenzie, legal advisers to the Mandated  Lead
      Arrangers,  the  Security  Agent  and  the  Facility Agent in the Federal
      Republic of Germany.

                                      153

<PAGE>



11.   A legal opinion satisfactory to the Lenders of  the legal advisers to the
      Company in the jurisdiction in which the proposed  Additional  Obligor is
      incorporated  opining  on  the  due organisation and valid existence  and
      confirming the capacity and authorisation  of  the  Additional Obligor to
      enter into the Finance Documents.

12.   If  the  proposed  Additional Obligor is incorporated in  a  jurisdiction
      other than the Federal  Republic  of  Germany,  evidence that the process
      agent specified in Clause 40.2 (Service of Process),  if  not an Obligor,
      has  accepted  its  appointment  in  relation  to the proposed Additional
      Obligor.

13.   Accession   to  the  Security  Trust  Agreement  and  the   Intercreditor
      Agreement.


                                      154

<PAGE>



                                  SCHEDULE 3

                                   REQUESTS

                                    PART I
                              UTILISATION REQUEST



From: [name of relevant Borrower]

To:   Deutsche Bank Luxembourg S.A.

Dated:

Dear Sirs

       SGL CARBON AKTIENGESELLSCHAFT - [e]227,000,000 FACILITIES AGREEMENT
              DATED 3 FEBRUARY 2004 (THE "FACILITIES AGREEMENT")

1.    [We wish to borrow  a  Loan  on the following terms:] / [We wish [name of
      Issuing Bank] to issue the [Letter of Credit] as follows:]

<TABLE>
      <S>                                       <C>
      Proposed Utilisation Date:                [           ]  (or,  if  that  is  not  a
                                                Business Day, the next Business Day)

      Facility to be utilised:                  [Term Facility A]/[Term Facility B]/[Term
                                                Facility C]/[Revolving Credit Facility]

      Currency of [Loan]/[Letter of Credit]:    [     ]

      Amount:                                   [     ]   or,  if  less,  the  [Available
                                                Facility] [amount  in such currency which
                                                will  reduce  the Available  Facility  to
                                                zero]

      Interest Period:                          [           ]

      [Expiry Date:]                            [           ]

      [Issuing Bank:]                           [            ]

</TABLE>


2.    We confirm on our own behalf and on behalf of any other Obligor that each
      condition specified in Clause 4.2 (Further Conditions  Precedent)  of the
      Facilities  Agreement  is  satisfied  on  the  date  of  this Utilisation
      Request. We confirm that the [Loan]/[Letter of Credit] [is]/[are]  to  be
      applied  for the following purpose: [purpose permitted pursuant to Clause
      3 (Purpose) of the Facilities Agreement to be specified].

3.    [The proceeds  of  this  Loan  should  be  credited to [account].] / [The
      Letter of Credit should be issued in favour  of  [name of beneficiary] in
      the  form  attached  and  delivered  to  the  recipient  at  [address  of
      beneficiary.]

4.    This Utilisation Request is irrevocable.

                                      155

<PAGE>


      Yours faithfully

                     .....................................

                           authorised signatory for
                          [name of relevant Borrower]



      Confirmed by:

                     .....................................

                           authorised signatory for
                         SGL CARBON AKTIENGESELLSCHAFT



                                      156

<PAGE>


                                    PART II

              SELECTION NOTICE APPLICABLE TO A TERM LOAN FACILITY

From: [name of relevant Borrower]

To:   Deutsche Bank Luxembourg S.A.

Dated:

Dear Sirs

       SGL CARBON AKTIENGESELLSCHAFT - [e]227,000,000 FACILITIES AGREEMENT
              DATED 3 FEBRUARY 2004 (THE "FACILITIES AGREEMENT")

1.    We refer to the following Term Facility Loan[s] in Euros with an Interest
      Period ending on [               ].

2.    [We  request  that  the  above  Term Facility Loan[s] be divided  into  [
      ] Term Facility Loans with the following amounts and Interest Periods:]

                                      or

      [We request that the next Interest  Period  for  the  above Term Facility
      Loan[s] is [      ]].

3.    We confirm on our own behalf and on behalf of any other Obligor that each
      condition specified in Clause 4.2 (Further Conditions Precedent)  of  the
      Facilities  Agreement  is satisfied on the date of this Selection Notice.
      We confirm that the Term  Facility  Loan[s]  [is]/[are] to be applied for
      the following purpose: [purpose permitted pursuant  to Clause 3 (Purpose)
      of the Facilities Agreement to be specified].

4.    This Selection Notice is irrevocable.

                               Yours faithfully

                     .....................................

                           authorised signatory for
                         [name of relevant Borrower]

      Confirmed by:

                     .....................................

                           authorised signatory for
                         SGL CARBON AKTIENGESELLSCHAFT


                                      157

<PAGE>

                                  SCHEDULE 4

                            MANDATORY COST FORMULA

1.    The  Mandatory  Cost  is an addition to the interest rate  to  compensate
      Lenders for the cost of  compliance  with  (a)  the  requirements  of the
      Financial  Services Authority (or any other authority which replaces  all
      or any of its  functions) or (b) the requirements of the European Central
      Bank.

2.    On the first day  of  each  Interest  Period  (or  as  soon  as  possible
      thereafter)  the Facility Agent shall calculate, as a percentage rate,  a
      rate (the "ADDITIONAL COST RATE") for each Lender, in accordance with the
      paragraphs set  out  below.  The Mandatory Cost will be calculated by the
      Facility Agent as a weighted  average  of  the  Lenders'  Additional Cost
      Rates  (weighted  in proportion to the percentage participation  of  each
      Lender in the relevant  Loan)  and will be expressed as a percentage rate
      per annum.

3.    The Additional Cost Rate for any Lender lending from a Facility Office in
      a Participating Member State will  be  the  percentage  notified  by that
      Lender  to  the  Facility Agent as the cost of complying with the minimum
      reserve requirements of the European Central Bank.

4.    The Additional Cost Rate for any Lender lending from a Facility Office in
      the United Kingdom will be calculated by the Facility Agent as follows:

          E x 0.01
          -------- per cent. per annum.
            300
Where:

      E      is the rate  of  charge  payable  by  that Lender to the Financial
             Services Authority pursuant to the Fees Regulations (but, for this
             purpose, ignoring any minimum fee required  pursuant  to  the Fees
             Regulations) and expressed in pounds per {pound-sterling}1,000,000
             of the Fee Base of that Lender.

5.    For the purposes of this Schedule:

      (a)    "FEES   REGULATIONS"   means   the   Banking   Supervision  (Fees)
             Regulations  1999 or such other law or regulation  as  may  be  in
             force from time  to  time  in  respect  of the payment of fees for
             banking supervision; and

      (b)    "FEE BASE" has the meaning given to it, and  will be calculated in
             accordance with, the Fees Regulations.

6.    Each Lender shall supply any information required by  the  Facility Agent
      for the purpose of calculating its Additional Cost Rate.  In  particular,
      but   without   limitation,   each  Lender  shall  supply  the  following
      information in writing on or prior  to  the  date  on  which it becomes a
      Lender:

      (a)    its  jurisdiction  of  incorporation and the jurisdiction  of  its
             Facility Office; and

      (b)    any  other information that  the  Facility  Agent  may  reasonably
             require for such purpose.

                                      158

<PAGE>


      Each Lender shall  promptly  notify  the Facility Agent in writing of any
      change to the information provided by it pursuant to this paragraph.

7.    The percentages or rates of charge of  each  Lender  for the purpose of E
      above  shall  be  determined  by  the  Facility  Agent  based   upon  the
      information  supplied  to  it  pursuant  to  paragraph 6 above and on the
      assumption  that,  unless a Lender notifies the  Facility  Agent  to  the
      contrary, each Lender's  obligations  in relation to cash ratio deposits,
      Special Deposits and the Fees Regulations  are  the  same  as  those of a
      typical  bank  from  its  jurisdiction  of  incorporation with a Facility
      Office in the same jurisdiction as its Facility Office.

8.    The  Facility  Agent  shall  have  no liability to  any  person  if  such
      determination results in an Additional  Cost  Rate  which  over  or under
      compensates  any  Lender  and  shall  be  entitled  to  assume  that  the
      information  provided  by any Lender pursuant to paragraphs 3 and 6 above
      is true and correct in all respects.

9.    The Facility Agent shall  distribute the additional amounts received as a
      result  of  the Mandatory Cost  to  the  Lenders  on  the  basis  of  the
      Additional Cost Rate for each Lender based on the information provided by
      each Lender pursuant to paragraphs 3 and 6 above.

10.   Any determination  by  the  Facility  Agent  pursuant to this Schedule in
      relation to a formula, the Mandatory Cost, an Additional Cost Rate or any
      amount payable to a Lender shall, in the absence  of  manifest  error, be
      conclusive and binding on all Parties.

11.   The  Facility  Agent  may from time to time, after consultation with  the
      Company  and  the Lenders,  determine  and  notify  to  all  Parties  any
      amendments which  are  required  to  be made to this Schedule in order to
      comply with any change in law, regulation  or  any requirements from time
      to  time  imposed  by the Financial Services Authority  or  the  European
      Central Bank (or, in  any case, any other authority which replaces all or
      any of its functions) and any such determination shall, in the absence of
      manifest error, be conclusive and binding on all Parties.

                                      159

<PAGE>


                                  SCHEDULE 5

                         FORM OF TRANSFER CERTIFICATES



To:   Deutsche Luxembourg S.A. as Facility Agent

From: [The Existing Lender] (the  "EXISTING  LENDER") and [The New Lender] (the
"NEW LENDER")

Dated:

   SGL CARBON AKTIENGESELLSCHAFT - [e]227,000,000 FACILITIES AGREEMENT DATED 3
  FEBRUARY 2004 (THE "FACILITIES AGREEMENT") AND SALE AND PURCHASE AGREEMENT
              DATED [                   ] (THE "SALE AGREEMENT")

1.    We refer to Clause 25.5 (Procedure for Transfer):

      The Existing Lender and the New Lender agree  to  the Existing Lender and
      the New Lender assigning and transferring  all or part  of  the  Existing
      Lender's  Commitment  referred  to  in  the  Schedule and all its related
      rights  and  obligations under the Facility Agreement  and  the  Security
      Trust Agreement in accordance with Clause 25.5 (Procedure for Transfer).

      The New Lender  agrees  to the terms and conditions of the Sale Agreement
      and the Terms and Conditions attached hereto.

      The proposed Transfer Date is [             ].

      The Facility Office and address,  fax  number  and  attention details for
      notices of the New Lender for the purposes of Clause 33.2 (Addresses) are
      set out in the Schedule.

2.    The  New Lender expressly acknowledges the limitations  on  the  Existing
      Lender's obligations set out in Clause 25.2(b).

3.    This Transfer Certificate is governed by German law.



                         By:

                            _______________________



                            _______________________



                                      160

<PAGE>


                                 THE SCHEDULE

                       TRANSFER AND ASSUMPTION AGREEMENT

              COMMITMENT/RIGHTS AND OBLIGATIONS TO BE TRANSFERRED


           EXISTING LENDER'S COMMITMENT              TRANSFER AMOUNT






                           [insert relevant details]
  [Facility Office address, fax number and attention details for notices and
                         account details for payments]

Date:                                             Date:

[Existing Lender]                                 [New Lender]

By:                                               By:

This Transfer  Certificate  is  accepted by the Facility Agent and the Transfer
Date is confirmed as [    ].

Deutsche Bank Luxembourg S.A.                     By:


                                      161

<PAGE>


                             TERMS AND CONDITIONS

These  are the Terms and Conditions  applicable  to  the  transfer  certificate
including  the  Schedule thereto (the "TRANSFER CERTIFICATE") to which they are
annexed.

1.    INTERPRETATION

      In  these Terms  and  Conditions  words  and  expressions  shall  (unless
      otherwise expressly defined herein) bear the meaning given to them in the
      Transfer Certificate and the Facilities Agreement.

2.    TRANSFER

      The Existing  Lender  requests  the  New Lender to accept and procure the
      assignment  and  transfer   of  all or a part  (as  applicable)  of  such
      participation of the Existing Lender under the Facilities Agreement as is
      set  out  in  the relevant part of the  Transfer  Certificate  under  the
      heading  "Schedule"  (the  "PURCHASED  ASSETS")  by  counter-signing  and
      delivering  the Transfer Certificate to the Facility Agent at its address
      for the service  of notice specified in the Facilities Agreement.  On the
      Transfer Date the  New  Lender  shall  pay  to  the  Existing  Lender the
      settlement amount as specified in the pricing letter between the Existing
      Lender  and  the  New  Lender  dated the date of the Transfer Certificate
      (adjusted, if applicable, in accordance  with  the  Sale  Agreement)  and
      completion of the transfer will take place.

3.    EFFECTIVENESS OF TRANSFER

      The  New Lender hereby requests the Facility Agent to accept the Transfer
      Certificate  as being delivered to the Facility Agent pursuant to and for
      the purposes of  the  Facilities  Agreement  so  as  to  take  effect  in
      accordance  with  the  terms  of the Facilities Agreement on the Transfer
      Date or on such later date as may  be  determined  in accordance with the
      terms thereof.

4.    NEW LENDER'S UNDERTAKING

      The New Lender hereby undertakes with the Facility Agent and the Existing
      Lender  and each of the other parties to the Finance  Documents  that  it
      will perform  in accordance with its terms all those obligations which by
      the terms thereof  will  be  assumed by it after delivery of the Transfer
      Certificate to the Facility Agent  and satisfaction of the conditions (if
      any) subject to which the Transfer Certificate is to take effect.

5.    PAYMENTS

5.1   PLACE

      All payments by either party to the  other under the Transfer Certificate
      shall be made to the  account of that  other  party specified in the Sale
      Agreement  (the  "RECEIVING  ACCOUNT").   Each  party   may  designate  a
      different  account  as  its Receiving Account for payment by  giving  the
      other not less than five (5) Business Days notice before the due date for
      payment.

                                      162

<PAGE>



5.2   FUNDS

      Payments under the Transfer  Certificate shall be made in the currency in
      which the amount is denominated  for  value on the due date at such times
      and  in  such  funds  as  are customary at the  time  for  settlement  of
      transactions in that currency.

6.    THE FACILITY AGENT

      The Facility Agent shall not  be required to concern itself with the Sale
      Agreement and may rely on the Transfer Certificate without taking account
      of the provisions of such agreement.

7.    ASSIGNMENT OF RIGHTS

      The Transfer Certificate shall  be  binding upon and enure to the benefit
      of  each party and its successors and  permitted  assigns  PROVIDED  THAT
      neither  party  may assign and transfer its rights thereunder without the
      prior written consent of the other party.

8.    GOVERNING LAW AND JURISDICTION

      The Transfer Certificate  (including, without limitation, these Terms and
      Conditions) shall be governed  by  and  construed  in accordance with the
      laws of the Federal Republic of Germany, and the parties  submit  to  the
      non-exclusive jurisdiction of the German courts.

      Each party irrevocably appoints the person described as process agent (if
      any)  specified in the Sale Agreement to receive on its behalf service of
      any action,  suit  or  other  proceedings in connection with the Transfer
      Certificate.  If any person appointed  as process agent ceases to act for
      any reason the appointing party shall notify  the  other  party and shall
      promptly appoint another person incorporated within the Federal  Republic
      of Germany to act as its process agent.


                                      163

<PAGE>


                                  SCHEDULE 6

                           FORM OF ACCESSION LETTER



                                    PART I

                       FORM OF BORROWER ACCESSION LETTER



To:   Deutsche Bank Luxembourg S.A. as Facility Agent

From: [Material Subsidiary] and SGL Carbon Aktiengesellschaft

Dated:

Dear Sirs

       SGL CARBON AKTIENGESELLSCHAFT - [e]227,000,000 FACILITIES AGREEMENT
              DATED 3 FEBRUARY 2004 (THE "FACILITIES AGREEMENT")

1.    [Material  Subsidiary]  agrees  to  become an Additional Borrower and  an
      Additional Guarantor and to be bound  by  the  terms  of  the  Facilities
      Agreement as an Additional Borrower and an Additional Guarantor  pursuant
      to  Clause  26 (Changes to the Obligors) of the Facilities Agreement  and
      the terms of  the  Security  Trust Agreement.  [Material Subsidiary] is a
      company  duly  incorporated  under   the   laws   of  [name  of  relevant
      jurisdiction].

2.    [Material Subsidiary's] administrative details are as follows:

      Address:

      Fax No:

      Attention:

3.    [Material Subsidiary] agrees to provide and, to the  extent  permitted by
      law, causes any Subsidiary to provide, such Security for all or  any part
      of  its  obligations  under  the  Finance Documents as the Facility Agent
      shall reasonably require.

4.    This letter is governed by German law.



      [Company]                             [Material Subsidiary]


                                      164

<PAGE>


                                       PART II

                      FORM OF GUARANTOR ACCESSION LETTER



To:   Deutsche Bank Luxembourg S.A. as Facility Agent

From: [Subsidiary] and SGL Carbon Aktiengesellschaft

Dated:

Dear Sirs

       SGL CARBON AKTIENGESELLSCHAFT - [e]227,000,000 FACILITIES AGREEMENT
              DATED 3 FEBRUARY 2004 (THE "FACILITIES AGREEMENT")

1.    [Subsidiary] agrees to become an Additional  Guarantor and to be bound by
      the terms of the Facilities Agreement as an Additional Guarantor pursuant
      to Clause 26 (Changes to the Obligors) of the  Facilities  Agreement  and
      the  terms  of  the  Security Trust Agreement.  [Subsidiary] is a company
      duly incorporated under the laws of [name of relevant jurisdiction].

2.    [Subsidiary's] administrative details are as follows:

      Address:

      Fax No:

      Attention:

3.    [Subsidiary] agrees to  provide  and,  to  the  extent  permitted by law,
      causes any Subsidiary to provide, such Security for all or  any  part  of
      its  obligations  under the Finance Documents as the Facility Agent shall
      reasonably require.

4.    This letter is governed by German law.







      For and on behalf of

      SGL CARBON AKTIENGESELLSCHAFT               [Subsidiary]



                                      165

<PAGE>


                                  SCHEDULE 7

                        FORM OF COMPLIANCE CERTIFICATE


To:   Deutsche Bank Luxembourg S.A. as Facility Agent

From: SGL Carbon Aktiengesellschaft

Dated:

Dear Sirs

       SGL CARBON AKTIENGESELLSCHAFT - [e]227,000,000 FACILITIES AGREEMENT
              DATED 3 FEBRUARY 2004 (THE "FACILITIES AGREEMENT")

1.    We refer to the Facilities Agreement.  This is a Compliance Certificate.

2.    We confirm that:  [Insert details of covenants to be certified, including
      calculations and explanations]

3.    On the basis of above, we confirm that:

      (a)    the Margin in respect of Term Facility Loans after your receipt of
             this Compliance  Certificate  will  be  [         ]  per cent. per
             annum; and

      (b)    the  Margin  in  respect of Revolving Credit Facility Loans  after
             your receipt of this Compliance Certificate will be [
             ] per cent. per annum.

3.    The following entities are Material Subsidiaries (as this term is defined
      in the Facilities Agreement): [identify relevant entities]

4.    We confirm that no Default is continuing.

Signed: ...............                     ...............

      Director                              Director

      of                                    of

      SGL CARBON AKTIENGESELLSCHAFT         SGL CARBON AKTIENGESELLSCHAFT

[insert applicable certification language]

......................

for and on behalf of

[name of auditors of the Company]


                                      166

<PAGE>


                                  SCHEDULE 8

                               EXISTING SECURITY



<TABLE>
<CAPTION>
Name of Obligor               Security         Total Principal Amount of Indebtedness Secured
<S>                             <C>                                 <C>
</TABLE>


Details of any existing security,  which will remain in place after the Closing
Date, to be inserted.



                                NOT APPLICABLE




                                      167

<PAGE>


                                  SCHEDULE 9

                    LMA FORM OF CONFIDENTIALITY UNDERTAKING



                      LMA CONFIDENTIALITY LETTER (SELLER)

                 [LETTERHEAD OF SELLER/SELLER'S AGENT/BROKER]


To:


                                              [insert name of Potential
                                              Buyer/Buyer's Agent/broker]





RE:   SGL CARBON AKTIENGESELLSCHAFT - [e]227,000,000 FACILITIES AGREEMENT



BORROWER: SGL CARBON AKTIENGESELLSCHAFT
DATE:
AMOUNT:  [e]227,000,000
AGENT:




Dear Sirs

We  understand  that  you   are   considering   [acquiring][1]/[arranging   the
acquisition of][2] an interest in the Facilities Agreement (the "ACQUISITION").
In consideration  of us agreeing to make available to you certain  information,
by your signature of a copy of this letter you agree as follows:

1.    Confidentiality Undertaking  You  undertake  (a) to keep the Confidential
      Information  confidential  and not to disclose it  to  anyone  except  as
      provided for by paragraph 2  below  and  to  ensure that the Confidential
      Information is protected with security measures and a degree of care that
      would  apply  to  your  own  confidential information,  (b)  to  use  the
      Confidential Information only  for  the Permitted Purpose, (c) to use all
      reasonable endeavours to ensure that  any  person  to  whom  you pass any
      Confidential  Information  (unless  disclosed  under paragraph 2[(c)/(d)]
      below) acknowledges and complies with the provisions of this letter as if
      that person were also a party to it, and (d) not to make



 [1] delete if addressee is acting as broker or Agent
 [2] delete if addressee is acting as principal





                                      168

<PAGE>







      enquiries of any Group  Member  or  any  of  their  officers,  directors,
      employees   or  professional  advisers relating directly or indirectly to
      the Acquisition.

2.    Permitted  Disclosure    We  agree  that  you  may  disclose Confidential
      Information:

      (a)    to  members  of  the  Buyer  Group and their officers,  directors,
             employees and professional advisers  to  the  extent necessary for
             the Permitted Purpose and to any auditors of members  of the Buyer
             Group;

      (b)    [subject  to  the  requirements  of  the Facilities Agreement,  in
             accordance with the Permitted Purpose  so  long as any prospective
             buyer  has delivered a letter to you in equivalent  form  to  this
             letter;]

      [(c/d] subject  to  the  requirements of the Facilities Agreement, to any
             person to (or through)  whom  you  assign  and  transfer  (or  may
             potentially  assign  and  transfer)  all  or  any  of  the rights,
             benefits   and   obligations  which  you  may  acquire  under  the
             Facilities Agreement  or with (or through) whom you enter into (or
             may potentially enter into)  any sub-participation in relation to,
             or any other transaction under  which  payments  are to be made by
             reference  to,  the  Facilities Agreement or the Borrower  or  any
             Group Member so long as  that person has delivered a letter to you
             in equivalent form to this letter; and

      [e/f]  (i)  where  requested  or  required  by  any  court  of  competent
             jurisdiction or any competent  judicial, governmental, supervisory
             or regulatory body, (ii) where required  by the rules of any stock
             exchange on which the shares or other securities  of any member of
             the Buyer Group are listed or (iii) where required  by the laws or
             regulations of any country with jurisdiction over the  affairs  of
             any member of the Buyer Group.

3.    Notification  of  Required  or Unauthorised Disclosure  You agree (to the
      extent permitted by law) to inform  us  of  the full circumstances of any
      disclosure  under  paragraph  2[(c)/(d)]  or  upon  becoming  aware  that
      Confidential Information has been disclosed in breach of this letter.

4.    Return of Copies    If we so request in writing,  you  shall  return  all
      Confidential Information supplied to you by us and destroy or permanently
      erase  all  copies  of  Confidential  Information made by you and use all
      reasonable endeavours to ensure that anyone to whom you have supplied any
      Confidential Information destroys or permanently erases such Confidential
      Information and any copies made by them,  in each case save to the extent
      that you or the recipients are required to  retain  any such Confidential
      Information by any applicable law, rule or regulation or by any competent
      judicial, governmental, supervisory or regulatory body  or  in accordance
      with  internal  policy,  or  where the Confidential Information has  been
      disclosed under paragraph 2[(c)/(d)] above.

5.    Continuing Obligations  The obligations  in  this  letter  are continuing
      and,  in particular, shall survive the termination of any discussions  or
      negotiations  between you and us.  Notwithstanding the previous sentence,
      the obligations  in  this letter shall cease (a) if you become a party to
      or otherwise acquire (by  assignment  or  sub-participation) an interest,
      direct or indirect, in the Facilities Agreement or (b) twelve (12) months
      after you have returned all Confidential Information  supplied  to you by
      us  and  destroyed  or  permanently  erased  all  copies  of Confidential
      Information made by you (other than any such Confidential Information  or
      copies which have been disclosed under paragraph 2 above


                                      169

<PAGE>


      (other than sub-paragraph 2(a)) or which, pursuant to paragraph 4 above,
      are not required to be returned or destroyed)).

6.    No Representation; Consequences of Breach etc   You acknowledge and agree
      that:

      (a)    neither  we,  [nor  our principal] nor any Group Member nor any of
             our or their respective  officers,  employees  or advisers (each a
             "RELEVANT  PERSON")  (i)  make  any  representation  or  warranty,
             express or implied, as to, or assume any responsibility  for,  the
             accuracy,  reliability  or completeness of any of the Confidential
             Information  or  any other  information  supplied  by  us  or  the
             assumptions on which  it  is  based  or  (ii)  shall  be under any
             obligation to update or correct any inaccuracy in the Confidential
             Information  or  any  other  information  supplied  by  us  or  be
             otherwise  liable  to  you  or  any other person in respect to the
             Confidential Information or any such information; and

      (b)    we [or our principal] or Group Members  may  be irreparably harmed
             by  the  breach  of the terms hereof and damages  may  not  be  an
             adequate remedy; each Relevant Person may be granted an injunction
             or specific performance for any threatened or actual breach of the
             provisions of this letter by you.

7.    No Waiver; Amendments, etc   This letter sets out the full extent of your
      obligations of confidentiality  owed to us in relation to the information
      the subject of this letter.  No failure or delay in exercising any right,
      power or privilege hereunder will  operate  as  a waiver thereof nor will
      any single or partial exercise of any right, power  or privilege preclude
      any further exercise thereof or the exercise of any other right, power or
      privileges  hereunder.   The  terms  of this letter and your  obligations
      hereunder may only be amended or modified  by  written  agreement between
      us.

8.    Inside  Information You acknowledge that some or all of the  Confidential
      Information  is or may be price-sensitive information and that the use of
      such information may be regulated or prohibited by applicable legislation
      relating to insider dealing and you undertake not to use any Confidential
      Information for any unlawful purpose.

9.    Nature of Undertakings   The  undertakings given by you under this letter
      are given to us and (without implying  any  fiduciary  obligations on our
      part)  are also given for the benefit of [our principal,]4  the  Borrower
      and each other Group Member.

10.   Governing  Law  and  Jurisdiction   This  letter (including the agreement
      constituted by your acknowledgement of its  terms)  shall  be governed by
      and  construed  in  accordance  with the laws of the Federal Republic  of
      Germany and the parties submit to  the  non-exclusive jurisdiction of the
      German courts.

11.   Definitions  In this letter (including the acknowledgement set out below)
      terms  defined  in the Facilities Agreement  shall,  unless  the  context
      otherwise requires, have the same meaning and:

      "BUYER GROUP" means  you, each of your holding companies and subsidiaries
      and each subsidiary of each of your holding companies;


                                      170

<PAGE>


      "CONFIDENTIAL  INFORMATION"   means   any  information  relating  to  the
      Borrower,  the  Group, the Facilities Agreement  and/or  the  Acquisition
      provided to you by  us  or any of our Affiliates or advisers, in whatever
      form, and includes information  given orally and any document, electronic
      file  or any other way of representing  or  recording  information  which
      contains  or  is  derived  or  copied  from such information but excludes
      information  that (a) is or becomes public  knowledge  other  than  as  a
      direct or indirect result of any breach of this letter or (b) is known by
      you before the  date  the information is disclosed to you by us or any of
      our Affiliates or advisers  or  is  lawfully  obtained by you thereafter,
      other than from a source which is connected with  the Group and which, in
      either case, as far as you are aware, has not been  obtained in violation
      of, and is not otherwise subject to, any obligation of confidentiality;

      "GROUP"  means  the  Borrower  and  each  of  its  holding companies  and
      subsidiaries and each subsidiary of each of its holding companies; and

      "PERMITTED PURPOSE" means [subject to the terms of this  letter,  passing
      on information to a prospective buyer for the purpose of] considering and
      evaluating whether to enter into the Acquisition.

Please  acknowledge  your  agreement  to the above by signing and returning the
enclosed copy.

Yours faithfully



..............................................
For and on behalf of

[Seller/Seller's Agent/broker]

To:   [Seller]
      [Seller's Agent/broker]

      The Borrower and each other Group Member


We acknowledge and agree to the above:

..............................................

For and on behalf of

[POTENTIAL BUYER/BUYER'S AGENT/BROKER]



                                      171

<PAGE>




                                  SCHEDULE 10

                                  TIMETABLES

                                    PART I

                                     LOANS

<TABLE>
<CAPTION>
                                                                                                       LOANS IN      LOANS IN
                                                                                                       EURO          DOLLARS
<S>                                                                                                    <C>           <C>
Delivery of a duly completed Utilisation  Request  (Clause 5.1  (Delivery  of  a  Utilisation          D-3           D-4
Request) or a Selection Notice Clause 11.1 (Selection of Interest Periods)                             12.00 noon    12.00 noon
Facility  Agent  notifies  the  Lenders of the amount and currency of the Loan in accordance           D-3           D-3
with Clause 5.4 (Lenders' Participation)                                                               05.00 p.m.    02.00 p.m.
Facility Agent receives a notification from a Lender under Clause 6.2 (Unavailability of Dollars)                    D-2
                                                                                                                     09.00 a.m.
Facility Agent gives notice to the  relevant  Borrower  in  accordance  with  Clause 6.2                             D-2
(Unavailability of Dollars)                                                                                          10.00 a.m.
LIBOR or EURIBOR is fixed                                                                              Quotation     Quotation
                                                                                                       Day  as of    Day as of
                                                                                                       11:00am       11:00 a.m.
                                                                                                       (Brussels     London
                                                                                                       time) in      time
                                                                                                       respect of
                                                                                                       EURIBOR
</TABLE>


D =   first day of relevant Interest Period.

D - X = X Business Days prior to D.



                                      172

<PAGE>

                                    PART II

                               LETTERS OF CREDIT



<TABLE>
<CAPTION>
                                                                                                            LETTERS
                                                                                                            OF
                                                                                                            CREDIT
<S>                                                                                                         <C>
Delivery of a duly completed Utilisation Request (Clause 5.1 (Delivery of a Utilisation Request))
                                                                                                            U-5
                                                                                                            12.00 noon.
Facility  Agent  notifies the Lenders and the Issuing Banks of any Letter of Credit in accordance
with Clause 5.4 (Lenders' Participation).                                                                   U-3
                                                                                                            12.00 noon
</TABLE>


U = date of utilisation.

U - X = X BUSINESS DAYS PRIOR TO U.




                                      173

<PAGE>


                                  SCHEDULE 11

                       FORM OF SECURITY TRUST AGREEMENT




                                      174

<PAGE>


                                  SCHEDULE 12

                       BORROWERS AND THEIR ALLOCATIONS

                                    PART I

                                TERM FACILITY A



<TABLE>
<CAPTION>
NAME OF ADDITIONAL BORROWER              AMOUNT OF SUCH BORROWER'S ALLOCATION
<S>                                      <C>
SGL CARBON S.A., LA CORUNA, SPAIN        [e]10,000,000
SGL CARBON S.P.A., MILANO                [e]15,000,000
TOTAL                                    [e]25,000,000
</TABLE>




                                    PART II

                                TERM FACILITY B



<TABLE>
<CAPTION>
NAME OF ADDITIONAL BORROWER              AMOUNT OF SUCH BORROWER'S ALLOCATION
<S>                                      <C>
SGL CARBON AG, WIESBADEN, GERMANY        [e]140,000,000
TOTAL                                    [e]140,000,000
</TABLE>




                                   PART III

                                TERM FACILITY C



<TABLE>
<CAPTION>
NAME OF ADDITIONAL BORROWER              AMOUNT OF SUCH BORROWER'S ALLOCATION
<S>                                      <C>
SGL CARBON AG, WIESBADEN, GERMANY        [e]20,000,000
TOTAL                                    [e]20,000,000
</TABLE>




                                      175

<PAGE>



                                    PART IV

                           REVOLVING CREDIT FACILITY



<TABLE>
<CAPTION>
NAME OF APPROVED ADDITIONAL BORROWER       AMOUNT OF SUCH APPROVED BORROWER'S ALLOCATION
<S>                                        <C>
SGL CARBON AG, WIESBADEN, GERMANY          [e]42,000,000
TOTAL                                      [e]42,000,000
</TABLE>




                                      176

<PAGE>


                                  SCHEDULE 13

                        CURRENT MATERIAL SUBSIDIARIES

<TABLE>
<CAPTION>
NAME OF MATERIAL SUBSIDIARY                                JURISDICTION OF INCORPORATION AND REGISTRATION
                                                           NUMBER (OR EQUIVALENT, IF ANY)
<S>                                                        <C>
SGL CARBON GMBH, MEITINGEN                                 GERMANY
SGL ACOTEC GMBH, SIEHRSHAHN                                GERMANY
SGL CARBON GMBH & CO, STEEG                                AUSTRIA
SGL CARBON S.P.A., MILAN                                   ITALY
SGL CARBON S.A., LA CORUNA                                 SPAIN
SGL CARBON POLSKA S.A. (FORMERLY "ZEW S.A."), RACIBORZ     POLAND
SGL CARBON LLC                                             NEVADA, USA
SGL TECHNIC, INC., VALENCIA, CALIFORNIA                    CALIFORNIA, USA
SGL ACOTEC SAS                                             FRANCE
</TABLE>




                                      177

<PAGE>


                                  SCHEDULE 14

                           FORM OF LETTER OF CREDIT


[Letterhead]

                                                                         [Date]


BANKBURGSCHAFT
SACHE COMP/E - 1/36.490 - GRAPHITELEKTRODEN


Die nachfolgend  genannten Banken  bestatigen Ihnen hiermit,  dass jede einzelne
Bank als  Teilschuldner  bis zur Hohe des neben der  jeweiligen  Bank  genannten
Hochstbetrages  zuzuglich insoweit  gegebenenfalls  geschuldeter Zinsen zu einem
Zinssatz von 6,04 % bezogen auf den jeweiligen Hochstbetrag und begrenzt auf den
Zeitraum vom 24. Oktober 2001 bis zum Zeitpunkt der tatsachlichen  Erfullung der
gesicherten Verbindlichkeit

<TABLE>
<CAPTION>
BANK                                       HOCHSTBETRAG
<S>                                        <C>    <C>

Deutsche Bank Luxembourg S.A.             :[e]    10.644.457,25
Dresdner Bank AG in Munchen               :[e]    10.644.457,25
Bayerische Landesbank                     :[e]    10.974.736,89
Commerzbank Aktiengesellschaft,
Augsburg Branch                           :[e]     6.753.684,46
WestLB AG                                 :[e]     6.753.684,46
DZ Bank Deutsche Zentral-
Genossenschaftsbank                       :[e]     5.179.567,93
Bayerische Hypo- und Vereinsbank AG,
Augsburg Branch                           :[e]    29.249.411,76



</TABLE>

GESAMTBETRAG:
                               EUR 80.200.000,00
          (in Worten: Euro achtzigmillionenzweihunderttausend 00/100)

fur  die  Erfullung  der folgenden Verbindlichkeit  der  SGL  CARBON  AG,
Rheingaustrasse 182, D-65203  Wiesbaden,  gegenuber  der  Kommission der
Europaischen Gemeinschaften die Burgschaft ubernehmen:

-      Geldbusse  in Hohe von 80,2  Mio.  EUR,  die der SGL  CARBON AG durch die
       Entscheidung der Kommission der Europaischen  Gemeinschaften vom 18. Juli
       2001  in der  Sache  COMP/E-1/36.490  auferlegt  worden  ist  und vom 24.
       Oktober 2001 bis zum  Zeitpunkt der  tatsachlichen  Zahlung der Geldbusse
       mit dem Zinssatz zu verzinsen ist, den die  Europaische  Zentralbank  fur
       Hauptrefinanzierungsgeschafte  im Monat Juli 2001 anwendet (d.h.  4,54 %,
       wie im Amtsblatt der Europaischen  Gemeinschaften Nr. C 188/1 vom 4. Juli
       2001 bekanntgegeben,  erhoht um eineinhalb Prozentpunkte,  insgesamt 6,04
       %).



                                      178

<PAGE>



   Diese Burgschaftsversprechen konnen nur mit Zustimmung der  Kommission
   der Europaischen Gemeinschaften widerrufen werden.

   Die Banken verzichten auf die Einrede der Vorausklage.

   Die  genannte Burgschaft wird fallig auf Ihre erste Anforderung  durch
   mit Einschreibebrief an die Deutsche Bank Luxembourg S.A. (handelnd insoweit
   als  Empfangsvertreter   aller   oben   genannten   Banken)   ubersandte,
   beglaubigte  Abschrift  des  Urteils  des  Gerichts erster Instanz bzw.  des
   Gerichtshofs  der  Europaischen  Gemeinschaften   in  der  Sache  COMP/E-
   1/36.490.

   Die Burgschaft erlischt, abgesehen von der Erfullung der Anspruche,
   durch  Ruckgabe  dieser  Urkunden  an die Deutsche Bank  Luxembourg  S.A.
   (handelnd insoweit als Vertreter aller oben genannten Banken).

   Diese  Burgschaft unterliegt dem Recht  der  Bundesrepublik  Deutschland.
   Ausschliesslicher  Gerichtsstand  fur  diese  Burgschaft  ist  der
   Gerichtshof / das Gericht erster Instanz der Europaischen Gemeinschaft in
   Luxembourg.


Deutsche Bank Luxembourg S.A.             ____________________________________

Dresdner Bank AG in Munchen            ____________________________________

Bayerische Landesbank                     ____________________________________

Commerzbank Aktiengesellschaft,
Augsburg Branch                           ____________________________________

WestLB AG                                 ____________________________________

DZ Bank Deutsche Zentral-
Genossenschaftsbank                       ____________________________________

Bayerische Hypo- und Vereinsbank AG,
Augsburg Branch                           ____________________________________




                                      179

<PAGE>


                                  SCHEDULE 15

         EXISTING COMPETITION LAW PROCEEDINGS AND ANTI-TRUST LAWSUITS


<TABLE>
<CAPTION>
I.  ALL PENDING ANTITRUST
    PROCEEDINGS OF SGL
    GROUP:
<S>                          <C>         <C>               <C>              <C>

PLAINTIFF/                                                 CAUSE OF
INVESTIGATING AUTHORITY      DEFENDANT   COURT/FILING      ACTION/          STATUS
                                         NUMBER            PLAINTIFF'S
                                                           CLAIMS
-----------------------------------------------------------------------------------------------------------------------
1. EU Commission             SGL AG      EuG/Az.:          Graphite         Fine imposed on 18.07.01;
                                         T-239/01          electrodes       Appeal at European Court

-----------------------------------------------------------------------------------------------------------------------
2. EU Commission             SGL AG      EuG/Az.:          Isostatic        Fines imposed by 17 December 2002;
                                         T-91/03           and extruded     Appeal at European Court
                                                           speciality
                                                           products

-----------------------------------------------------------------------------------------------------------------------
3. EU Commission             SGL Carbon  Sache COMP/       Electrical       Fines imposed by 3 December 2003;
                             Group       E- 1/38.359       a. mechanical    Appeal at European Court
                                                           carbon a.        under consideration
                                                           graphite
                                                           products

-----------------------------------------------------------------------------------------------------------------------
4. Korean Fair               SGL AG      Case              Graphite         Interim Appeal denied; Appeal filed denied
Trade Commission                         No.:2002          electrodes       on 27-09-02; appeal to supreme court filed
                                         Shinsam 0585                       on 21 October 2003

</TABLE>


                                      180

<PAGE>




II. ALL PENDING ANTITRUST
    RELATED CIVIL LAW
    SUITS CONCERNING SGL
    GROUP:
<TABLE>
<CAPTION>
<S>                 <C>               <C>                <C>                    <C>
                                                         CAUSE OF
PLAINTIFF           DEFENDANT         COURT/FILING       ACTION/                STATUS
                                      NUMBER             PLAINTIFF'S
                                                         CLAIMS

----------------------------------------------------------------------------------------------------------------------------------
1.  FOREIGN PURCHASER
    LAW SUITS

----------------------------------------------------------------------------------------------------------------------------------
A. FERROMIN         SGL AG/SGL        D.C. of            civil action           dismissed for lack of standing and lack of subject
Internat.           U.S. and          Pennsylvania       for damages            matter jurisdiction, decision of DC on appeal
Trade Corp.         other             Cases No. 99       (GE)
and others                            CV 693

----------------------------------------------------------------------------------------------------------------------------------
B. BROKEN HILL      SGL AG/SGL        D.C. of            civil action           dismissed for lack of standing and lack of subject
Proprietary         U.S. and          Pennsylvania       for damages            matter jurisdiction, decision of DC on appeal
Co. Ltd             other             Case No. 99        (GE)
(Australia)                           CV 4772
and others

----------------------------------------------------------------------------------------------------------------------------------
C. SAUDI IRON       SGL AG/SGL        D.C. of            civil action           dismissed subject to reinstatement upon resolution
AND STEEL           U.S. and          Pennsylvania       for damages            of Ferromin and BHP appeals
COMPANY             other             Case No. 00        (GE)
                                      CV 5414

----------------------------------------------------------------------------------------------------------------------------------
D. ARBED S.A.       SGL AG/SGL        D.C. of            civil action           dismissed with prejudice
                    U.S. and          Pennsylvania       for damages
                    other             Case No. 02        (GE)
                                      CV 822

----------------------------------------------------------------------------------------------------------------------------------
2. ISOSTATIC        SGL AG/SGL        D.C. of            class action           Settled April 2003 (not yet presented to or
GRAPHITE            U.S. and          Pennsylvania       (Isographit)           approved by Court)
Antitrust           other             Case No.
litigation                            00Master
(consolidated                         File No. 00
cases)                                CV 1857
                                      (for all iso)

----------------------------------------------------------------------------------------------------------------------------------
3. BULK             AG/SGL            D.C. of New        class action           Motions to dismiss filed
(EXTRUDED)          US/SGL            Jersey (case       (extruded)
GRAPHITE            GmbH and          no. 02 CV
PRODUCTS            others            6030)
Antitrust
litigation
(consolidated
cases)
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                      181

<PAGE>

<TABLE>
<CAPTION>
<S>                 <C>               <C>                <C>                    <C>

----------------------------------------------------------------------------------------------------------------------------------
4. ELECTRICAL       SGL AG/           Superior           CGC-03-                named defendant in December 2003
CARBON              SGL US            Court of the       422635
PRODUCTS            /SGL              State of           cl
Antitrust           Technic           California
Litigation          Ltd.

----------------------------------------------------------------------------------------------------------------------------------
5. NORTHWEST        SGL AG/SGL        D.C. of            civil action           Settlement discussions; case against SGL AG
ALUMINIUM           U.S. and          Oregon             for damages            dismissed on jurisdictional grounds (though
COMPANY/            other                                (GE)                   plaintiffs are seeking to add new jurisdictional
GOLDENDALE                                                                      allegations); active discovery regarding SGL U.S.
ALUMINIUM
COMPANY

----------------------------------------------------------------------------------------------------------------------------------
Iso =               GE =              SGL AG = SGL       SGL U.S. =             D.C: of Pennsylvania = United States District
Isostatic           Graphite          Carbon AG          SGL Carbon             Court for the Eastern District of Pennsylvania
graphite            electrodes        D.C. =             LLC (former
SGL GmbH = SGL                        District           Corp.)
Carbon GmbH                           Court

</TABLE>



                                      182

<PAGE>


                                  SCHEDULE 16



                          EXISTING INTRA-GROUP LOANS

                            AS OF JANUARY 29, 2004



<TABLE>
<CAPTION>
LENDER                  BORROWER                      KIND OF LOAN         CURR.LENDER
<S>                     <C>                           <C>                  <C>  <C>                           <C>        <C>
KCH BETEILIGUNGS GMBH   SGL ACOTEC Inc., USA          Short-term IC-Loan   USD  KCH BETEILIGUNGS GMBH
                        SGL ACOTEC GmbH, Siershahn    Short-term IC-Loan   EUR                                NOTIONAL   DUE DATE
SGL ACOTEC GMBH         SGL Composites SA, France     IC  balances  daily  EUR  SGL ACOTEC GMBH MEITINGEN     4.722.175  12.02.2004
MEITINGEN                                             due
                        SGL CARBON AG                 IC  balances  daily  EUR                                5.190.500  31.03.2004
                                                      due
SGL ACOTEC GMBH,        SGL ACOTEC China Ltd., Wuhan  Short-term IC-Loan   EUR  SGL ACOTEC GMBH, SIERSHAHN
SIERSHAHN
                        Osko GmbH, Pasching           Short-term IC-Loan   EUR                               58.904.762
                        KCH Beteiligungs GmbH         Short-term IC-Loan   EUR                                  150.000  20.04.2004
                        SGL ACOTEC Ltda., Brazil      Short-term IC-Loan   EUR                                  150.000  31.03.2004
                        SGL ACOTEC Ltda., Brazil      Short-term IC-Loan   EUR                               13.590.698  31.03.2004
                        SGL ACOTEC Ltda., Brazil      Short-term IC-Loan   EUR                                  150.000  11.02.2004
                        SGL ACOTEC Ltda., Brazil      Short-term IC-Loan   EUR                                   25.000  09.03.2004
                        SGL ACOTEC Ltda., Brazil      Short-term IC-Loan   EUR                                  300.000  10.03.2004
                        SGL ACOTEC Ltda., Brazil      Short-term IC-Loan   EUR                                  220.000  30.04.2004
SGL ACOTEC LTD.         SGL CARBON AG                 Short-term IC-Loan   GBP  SGL ACOTEC LTD. SANDBACH        150.000  28.05.2004
SANDBACH
                        SGL ACOTEC GmbH, Siershahn    Short-term IC-Loan   EUR                                  120.000  02.06.2004
SGL ACOTEC S.A.R.L.,    SGL ACOTEC GmbH, Siershahn    IC  balances  daily  EUR  SGL ACOTEC S.A.R.L., LA         212.046  08.04.2004
LA COMTE                                              due                       COMTE
SGL ACOTEC SPA, ITALY   SGL CARBON SpA, Italy         IC  balances  daily  EUR  SGL ACOTEC SPA, ITALY           200.000  31.03.2004
                                                      due
SGL CARBON AG           SGL CARBON Beteiligung GmbH   IC  balances  daily  EUR  SGL CARBON AG                   630.000
                                                      due
                        SGL TECHNOLOGIES GmbH         IC  balances  daily  EUR                                   85.887
                                                      due
                        SGL ACOTEC GmbH, Siershahn    IC  balances  daily  EUR                              183.022.320
                                                      due
                        SGL TECHNIC Ltd., UK          Short-term IC-Loan   GBP                               58.384.731

</TABLE>

                                      183

<PAGE>








<TABLE>
<CAPTION>
<S>                     <C>                           <C>                  <C>  <C>                           <C>        <C>

                        SGL CARBON Japan LTD          Short-term IC-Loan   JPY                               46.122.415
                        SGL CARBON LLC., USA          Long-term IC-Loan    USD                               30.287.906  08.04.2004
                        SGL ACOTEC Ltda., Brazil      Short-term IC-Loan   USD                              248.300.000  23.02.2004
                        SGL CARBON S.p.A., Italy      IC  balances  daily  EUR                               56.432.248  18.02.2004
                                                      due
                        SGL ACOTEC China Ltd., Wuhan  Short-term IC-Loan   USD                                1.800.000  30.01.2004
                        SGL    Tokai   Carbon   Ltd,  Short-term IC-Loan   USD                                2.889.574
                        Shanghai
                        SGL  ACOTEC  Singapore  Pte.  Short-term IC-Loan   SGD                                3.600.000  30.01.2004
                        Ltd.
                        SGL Brakes GmbH               IC  balances  daily  EUR                                2.600.000  14.04.2004
                                                      due
SGL CARBON POLSKA S.A.  SGL CARBON AG                 Short-term IC-Loan   PLN  SGL CARBON POLSKA S.A.          600.000  29.03.2004
SGL CARBON              SGL CARBON AG                 IC  balances  daily  EUR  SGL CARBON GMBH & CO.,       10.286.602
GMBH & CO., AUSTRIA                                   due                       AUSTRIA
SGL CARBON GMBH         SGL CARBON AG                 IC  balances  daily  EUR  SGL CARBON GMBH              39.000.000  19.07.2004
                                                      due
                        SGL CARBON SA, Belgium        Short-term IC-Loan   EUR                                1.929.865
SGL CARBON              SGL CARBON AG                 IC  balances  daily  EUR  SGL CARBON HOLDINGS B.V.,    42.210.979
HOLDINGS B.V.,                                        due                       NETHERLANDS
NETHERLANDS
SGL CARBON SAS,         SGL CARBON AG                 IC  balances  daily  EUR  SGL CARBON SAS, FRANCE        3.300.000  21.02.2004
 FRANCE                                               due
                        SGL TECHNIC S.A., France      IC  balances  daily  EUR                                   12.046
                                                      due
SGL CARBON SA, SPAIN    SGL CARBON AG                 IC  balances  daily  EUR  SGL CARBON SA, SPAIN            424.984
                                                      due
SGL CARBON SPA, ITALY   Radion    Finanziaria   SpA,  IC  balances  daily  EUR  SGL CARBON SPA, ITALY         1.126.278
                        Italy                         due
                        SGL CARBON Specialities SpA,  IC  balances  daily  EUR                                7.672.750
                        Italy                         due
SGL CARBON LLC., USA    SGL CARBON AG                 IC  balances  daily  USD  SGL CARBON LLC., USA          3.678.199
                                                      due
                        Speer Canada Inc., Kitchener  IC  balances  daily  USD                                  317.258
                                                      due
                        Hitco Carbon Composites Inc.  IC  balances  daily  USD                                4.820.963
                                                      due
SGL FIBERS              SGL CARBON LLC., USA          IC  balances  daily  USD  SGL FIBERS AND COMPOSITES     1.496.378
AND COMPOSITES INC.                                   due                       INC.
SGL TECHNIC INC.        SGL CARBON LLC., USA          IC  balances  daily  USD  SGL TECHNIC INC.              5.450.000  31.12.2004
                                                      due
M.G.P. LLC              SGL CARBON LLC., USA          IC  balances  daily  USD  M.G.P. LLC                    1.226.247
                                                      due
CMS GRAPHITE LLC        SGL CARBON LLC., USA          IC  balances  daily  USD  CMS GRAPHITE LLC              2.398.203  31.03.2004
                                                      due
SGL ACOTEC INC.         SGL CARBON LLC., USA          IC  balances  daily  USD  SGL ACOTEC INC.                 125.000  31.03.2004
                                                      due
</TABLE>




                                      184

<PAGE>



                                  SCHEDULE 17

                             EXISTING INDEBTEDNESS
                            AS OF JANUARY 28, 2004


<TABLE>
<CAPTION>
BANK                               KIND OF LOAN        CURR.        BALANCE
<S>                                <C>                 <C>          <C>

SGL ACOTEC GMBH, SIERSHAHN
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR        15.000.000
Kreissparkasse Hildesheim         long-term debt       EUR           131.159
                                                       TOTAL:     15.131.159
SGL CARBON SA LA CORUNA
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR         5.000.000

SGL CARBON SPA MAILAND
Ministerio ICA                    long-term debt       EUR         1.016.253
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR        20.000.000
                                                       TOTAL:     21.016.253
SGL TECHNOLOGIES, MEITINGEN
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR        25.000.000


SGL POLSKA S.A. RACIBORZ
BNP Paribas Poland                Syndicated loan      EUR         6.529.206

SGL BRAKES GMBH
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR        20.000.000

SGL CARBON BETEILIGUNG GMBH
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR        20.000.000


SGL CARBON AG
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR       135.000.000
Deutsche Bank Luxembourg S.A.     Syndicated loan      EUR        31.000.000
KFW-Loan                          Syndicated loan      EUR        20.000.000
Convertible Bond                  long-term debt       EUR       133.650.000
                                                       TOTAL:    319.650.000

SGL CARBON LLC, USA
Deutsche Bank Luxembourg S.A.     Syndicated loan      USD        88.340.000

SGL ACOTEC CHINA
Bank of Communication             Short-term debt      CNY         4.300.000

</TABLE>




                                      185

<PAGE>



                                  SCHEDULE 18

                        FORM OF INTERCREDITOR AGREEMENT






                                      186

<PAGE>



SIGNATURES


THE COMPANY

SGL CARBON AKTIENGESELLSCHAFT

BY:

ADDRESS:     RHEINGAUSTR. 182
             D-65203 WIESBADEN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


THE ORIGINAL BORROWERS

SGL CARBON AKTIENGESELLSCHAFT

BY:

ADDRESS:     RHEINGAUSTR. 182
             D-65203 WIESBADEN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231




                                      187

<PAGE>




SGL CARBON, S.A.

BY:

ADDRESS:     ZONA INDUSTRIAL DE LA GRELA-APDO. 478
             E-15080 LA CORUNA

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL CARBON S.P.A.

BY:

ADDRESS:     PIAZZALE S. TUERR # 5
             I-20149 MILANO

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


THE ORIGINAL GUARANTORS

SGL CARBON AKTIENGESELLSCHAFT

BY:

ADDRESS:     RHEINGAUSTR. 182
             D-65203 WIESBADEN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231





                                      188

<PAGE>



SGL CARBON GMBH

BY:

ADDRESS:     WERNER-VON-SIEMENS-STRASSE 18
             D-86406 MEITINGEN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL CARBON BETEILIGUNG GMBH

BY:

ADDRESS:     RHEINGAUSTRASSE 182
             D-65203 WIESBADEN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231

SGL ACOTEC GMBH

BY:

ADDRESS:     BERGGARTEN 1
             D-56427 SIERSHAHN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231




                                      189

<PAGE>



KCH BETEILIGUNGS GMBH

BY:

ADDRESS:     BERGGARTEN 1
             56427 SIERSHAHN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL TECHNOLOGIES GMBH

BY:

ADDRESS:     WERNER-VON-SIEMENS-STRASSE 18
             86406 MEITINGEN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL BRAKES GMBH

BY:

ADDRESS:     WERNER-VON-SIEMENS-STRASSE 18
             86406 MEITINGEN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231





                                      190

<PAGE>



SGL CARBON S.P.A.

BY:

ADDRESS:     PIAZZALE S. TUERR # 5
             I-20149 MILANO

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL CARBON, S.A.

BY:

ADDRESS:     ZONA INDUSTRIAL DE LA GRELA-APDO. 478
             E-15080 LA CORUNA

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL CARBON LLC.

BY:

ADDRESS:     P.O.BOX 563960
             CHARLOTTE, NC 28256-3960, USA

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231




                                      191

<PAGE>



SGL CARBON GMBH

BY:

ADDRESS:     A-4823 STEEG AM HALLSTATTERSEE

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL CARBON GMBH & CO. KG

BY:

ADDRESS:     A-4823 STEEG AM HALLSTATTERSEE

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


RK CARBON INTERNATIONAL LTD.

BY:

ADDRESS:     MUIR OF ORD, ROSS-SHIRE, IV67UA, INVERNESS, SCOTTLAND

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN

PHONE:       +49 (0) 611-6029 - 235
FAX:         +49 (0) 611-6029 - 231




                                      192

<PAGE>



RK TECHNOLOGIES INTERNATIONAL LTD.

BY:

ADDRESS:     MUIR OF ORD, ROSS-SHIRE, IV67UA, INVERNESS, SCOTLAND

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL TECHNIC LTD.

BY:

ADDRESS:     MUIR OF ORD, ROSS-SHIRE, IV67UA, INVERNESS, SCOTTLAND

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL CARBON S.A.S

BY:

ADDRESS:     131 PLACE ARISTIDE BERGES
             F-74190 CHEDDE

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231




                                      193

<PAGE>



SGL ACOTEC SAS

BY:

ADDRESS:    18 AVENUE MARCEL CAHIN
            F-38400 SAINT MARTIN D' HERES

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


RADION FINANZIARIA S.P.A.

BY:

ADDRESS:     PIAZZALE STEFANO TURR # 5
             I-20149 MILAN

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL CANADA INC.

BY:

ADDRESS:     963 BETHANIE ST.,
             LACHUTE, QUEBEC J8H 2C5, CANADA

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231




                                      194

<PAGE>



SGL CARBON POLSKA S.A.

BY:

ADDRESS:     PIASTOWSKA 29
             47-400 RACIBORZ, POLAND

ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


SGL TECHNIC INC.

BY:

ADDRESS:     8600 BILL FICKLEN DRIVE
             CHARLOTTE, NORTH CAROLINA 28269, USA
ATTENTION:   CHRISTIAN SCHWARZ
             SGL CARBON AG
             RHEINGAUSTRASSE 182
             D-65203 WIESBADEN
PHONE:       +49 (0) 611- 6029-235
FAX:         +49 (0) 611- 6029-231


THE MANDATED LEAD ARRANGERS

BAYERISCHE LANDESBANK

BY:

ADDRESS:     BRIENNER STRASSE 20
             80333 MUNCHEN
ATTENTION:   DR. WOLFGANG HUTTER/DEPT. 2530
             WOLFGANG.HUETTER@BAYERNLB.DE

PHONE        +49-89-2171-22417
FAX:         +49-89-2171-22429




                                      195

<PAGE>



CREDIT SUISSE FIRST BOSTON INTERNATIONAL

BY:

ADDRESS:     CREDIT SUISSE FIRST BOSTON INTERNATIONAL
             ONE CABOT SQUARE
             LONDON E14 4QJ
             UNITED KINGDOM
ATTENTION:

PHONE:
FAX:


DEUTSCHE BANK AG

BY:

ADDRESS:     TAUNUSANLAGE 12
             60325 FRANKFURT AM MAIN
ATTENTION:   KARL-HEINZ HERWECK
             GLOBAL CORPORATE FINANCE

PHONE:       +49-69-910-33313
FAX:         +49-69-910-38793


DRESDNER KLEINWORT WASSERSTEIN,
THE INVESTMENT BANKING DIVISION OF DRESDNER BANK AG

BY:


ADDRESS:     JURGEN-PONTO-PLATZ 1
             60301 FRANKFURT AM MAIN
ATTENTION:   THOMAS MULDNER
             DIRECTOR, GLOBAL LOAN PRODUCT
             THOMAS.MUELDNER@DRKW.COM

PHONE:       +49-69-713-19267
FAX:         +49-69-713-2342




                                      196

<PAGE>



THE FACILITY AGENT AND SECURITY AGENT

DEUTSCHE BANK LUXEMBOURG S.A.

BY:

ADDRESS:     2, BOULEVARD KONRAD ADENAUER
             L-1115 LUXEMBOURG
ATTENTION:   INTERNATIONAL LOANS & AGENCY SERVICES
             FRANZ-JOSEF EWERHARDY/MARION SATTLER
             FRANZ-JOSEF.EWERHARDY@DB.COM; MARION.SATTLER@DB.COM

PHONE:       +352-42122-533/972
FAX:         +352-42122-287


THE DOCUMENTATION AGENT

CREDIT SUISSE FIRST BOSTON INTERNATIONAL

BY:

ADDRESS:     CREDIT SUISSE FIRST BOSTON INTERNATIONAL
             ONE CABOT SQUARE
             LONDON E14 4QJ
             UNITED KINGDOM
ATTENTION:

PHONE:
FAX:


THE ORIGINAL LENDERS

CREDIT SUISSE FIRST BOSTON INTERNATIONAL

BY:

ADDRESS:     CREDIT SUISSE FIRST BOSTON INTERNATIONAL
             ONE CABOT SQUARE
             LONDON E14 4QJ
             UNITED KINGDOM
ATTENTION:

PHONE:
FAX:




                                      197

<PAGE>



BAYERISCHE HYPO- UND VEREINSBANK AG

BY:

ADDRESS:     NL AUGSBURG
             BAHNHOFSTR. 11
             86150 AUGSBURG
ATTENTION:   ANDREA KNOLL
             ANDREA.KNOELL@HVB.DE

PHONE:       +49-821-316-1501
FAX:         +49-821-316-1583


DEUTSCHE BANK LUXEMBOURG S.A.

BY:

ADDRESS:     2, BOULEVARD KONRAD ADENAUER
             L-1115 LUXEMBOURG
ATTENTION:   INTERNATIONAL LOANS & AGENCY SERVICES
             FRANZ-JOSEF EWERHARDY/MARION SATTLER
             FRANZ-JOSEF.EWERHARDY@DB.COM; MARION.SATTLER@DB.COM

PHONE:       +352-42122-533/972
FAX:         +352-42122-287


DRESDNER BANK AG IN MUNCHEN

BY:


ADDRESS:     DRESDNER BANK AG IN MUNCHEN
             PROMENADEPLATZ 7
             80333 MUNCHEN
ATTENTION:   ARMIN ZIEGLER
             ARMIN.ZIEGLER@DRESDNER-BANK.COM

PHONE:       +49-89-2139-4557
FAX:         +49-89-2139-3149




                                      198

<PAGE>



BAYERISCHE LANDESBANK

BY:

ADDRESS:     BRIENNER STRASSE 20
             80333 MUNCHEN
ATTENTION:   DR. WOLFGANG HUTTER/DEPT. 2530
             WOLFGANG.HUETTER@BAYERNLB.DE

PHONE        +49-89-2171-22417
FAX:         +49-89-2171-22429


COMMERZBANK AKTIENGESELLSCHAFT

BY:

ADDRESS:     KAISERPLATZ
             60261 FRANKFURT AM MAIN
ATTENTION:   BERNARD SCHULTZ/ROLAND THIELE, ZRA IB II
             ZRA-IB3-DOC@COMMERZBANK.COM

PHONE:       069-136-20
FAX:         069-136-51510


DZ BANK AG DEUTSCHE ZENTRAL-GENOSSENSCHAFTSBANK

BY:

ADDRESS:     PLATZ DER REPUBLIK
             60265 FRANKFURT AM MAIN
ATTENTION:   FRIEDRICH MEYER/GUNTER TUTTENBERG
             FRIEDRICH.MEYER@DZBANK.DE/GUENTER.TUETTENBERG@DZBANK.DE

PHONE:       +49-69-7447-6643/+49-69-7447-7848
FAX:         +49-69-7447-3428/+49-69-7447-1511


KREDITANSTALT FUR WIEDERAUFBAU

BY:

ADDRESS:     PALMENGARTENSTRASSE 5-9
             60325 FRANKFURT AM MAIN
ATTENTION:   MAIKE THODE/ABT. X1 B3
             MAIKE.THODE@KFW.DE

PHONE.       +49-69-7431-4118
FAX:         +49-69-7431-2016




                                      199