EXECUTION COPY

                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT
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         THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT dated as of February 17,
1998 and  effective  as of and  simultaneous  with the  Merger  (the  "Effective
Date"), is among Mary J. George (the "Executive"), Bell Sports Corp., a Delaware
corporation  (the  "Holding  Company"),  and Bell  Sports,  Inc.,  a  California
corporation  (the  "Operating  Company").  The Holding Company and the Operating
Company are collectively referred to herein as the "Company."

         WHEREAS, the Company is engaged primarily in the business of designing,
manufacturing,  producing, distributing, marketing, advertising and selling auto
racing helmets, bicycle helmets, bicycle accessories and related products;

         WHEREAS,  pursuant to an Agreement  and Plan of  Recapitalization  (the
"Recapitalization   Agreement")   between  the   Company   and  HB   Acquisition
Corporation,  a Delaware corporation  ("Newco"),  Newco will merge with and into
(the  "Merger")  the  Company  and the Company  will  continue as the  surviving
corporation (the "Surviving Corporation");

         WHEREAS, the Executive currently serves as the President, North America
of the Operating Company pursuant to the terms of an Employment  Agreement dated
April  11,  1997,  as  amended  on  August  29,  1997  (the  "Prior   Employment
Agreement");

         WHEREAS,  the  Executive and the Company are parties to a Phantom Stock
Unit Agreement dated as of September 23, 1997 (the "Phantom Stock Agreement");

         WHEREAS,  the  Executive's   abilities  and  services  are  unique  and
essential to the prospects of the Company; and

         WHEREAS,  the Company and the Executive desire to amend and restate the
Prior  Employment  Agreement  in its  entirety in the form of this  Agreement to
provide for the  employment  of the  Executive by the Company upon the terms and
subject to the conditions set forth herein.

         NOW,  THEREFORE,  in  consideration  of the  premises  and  the  mutual
agreements contained herein, the parties hereby agree as follows:

         1.       Employment; Term.

         The Company  hereby  employs the  Executive  and the  Executive  hereby
agrees  to be  employed  by the  Company  upon  the  terms  and  subject  to the
conditions contained in this
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Agreement.  The term of this  Agreement  shall commence as of the Effective Date
and shall  continue  until  the fifth  anniversary  of the  Effective  Date (the
"Term"), unless earlier terminated pursuant to Section 4 hereof. As used herein,
the term "Employment Period" shall mean the period from the Effective Date until
the  earlier  to occur  of (i) the  expiration  of the Term or (ii) the  earlier
termination of Executive's employment hereunder pursuant to Section 4 hereof.

         2.       Position; Duties; Responsibilities.

                  2.1 Position;  Duties.  The Company shall employ the Executive
as the  President  and Chief  Executive  Officer of the Holding  Company and the
Operating  Company.  The Executive  shall  faithfully and loyally perform to the
best of her abilities all the duties reasonably  assigned to her by the Board of
Directors,  shall devote such business time, attention and effort to the affairs
of the Company as is  reasonably  necessary for the proper  performance  of such
duties and shall use her reasonable best efforts to promote the interests of the
Company.  Notwithstanding the foregoing,  the Executive may serve as a director,
officer or paid  consultant of business  corporations  other than the Company or
civic or community  organizations or entities,  provided that such activities do
not violate the terms of any of the  covenants set forth in Section 7 hereof and
such activities are approved prior to the  commencement  thereof by the Board of
Directors of Holding Company.

                  2.2  Responsibilities.  The  Executive  shall have  direct and
general supervision, direction and control of the management, officers, business
and affairs of the  Company,  including  the power and  authority to make policy
decisions,  including  those which (i) relate to the Company's  goals and plans,
(ii) have a substantial effect on the operation of the Company and its financial
position  or  results  of  operations  or (iii)  relate  to its  relations  with
governmental bodies, consumers or the public generally.

                  2.3   Directorship.   The  Company   shall  take  all  actions
reasonably  necessary  to elect the  Executive  to the Board of Directors of the
Operating  Company and the  Holding  Company  and to  maintain  the  Executive's
position as a director during the Employment Period.

         3.       Compensation.

                  3.1 Base Salary.  During the  Employment  Period,  the Company
shall pay to the  Executive  an annual base  salary at the rate of $350,000  per
annum,  payable in accordance with the Company's  executive payroll policy. Such
base salary shall be reviewed  annually,  commencing on the first anniversary of
the Effective Date, and may be increased (but shall not be decreased)  annually,
in the sole discretion of the Board of Directors of the Company. The Executive's
base  salary,  as such base  salary  may be  increased  annually  hereunder,  is
referred to herein as the "Base Salary."
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                  3.2      Annual Performance Bonus.

                           (a) The  Executive  shall be  entitled  to receive an
         annual  performance  bonus payable in cash for each full fiscal year of
         the  Company  during  the  Employment  Period  in  accordance  with the
         Company's management incentive program, as in effect from time to time.
         For the  Company's  fiscal  year ended  June 30,  1998,  the  Company's
         management   incentive  program  shall  be  the  Company's   management
         incentive  program as in effect on the date hereof. As of the Company's
         fiscal year ended June 30,  1999,  the Company  shall amend its current
         management  incentive  program  to include an  additional  measure  for
         determining  the  Executive's  bonus based on the  Company's  Return on
         Assets.  The  Company's  Return on Assets in any  fiscal  year shall be
         determined  and defined by the Board of Directors  of the Company.  The
         annual performance bonus to which the Executive is entitled pursuant to
         this Section 3(a) is referred to herein as the "Bonus."

                           (b) The payment of each Bonus shall be made within 30
         days after the Company's  independent  accountants shall have certified
         the Company's  consolidated financial statements for the fiscal year to
         which such Bonus relates.

                           (c)  If  the  Company's  fiscal  year  changes,   the
         Executive's  opportunity  to earn the Bonus shall not be materially and
         adversely affected.

                  3.3 Stock Options.  Upon the Effective Date, the Company shall
grant the Executive  options to purchase  shares of common equity of the Company
up to 41.76% of the Management Option Pool (the "Awarded Options").  The Awarded
Options  shall  have a term of ten  years.  The  Management  Option  Pool  shall
represent   equity  in  the  Company  equal  to  twelve  percent  (12%)  of  the
fully-diluted  common  equity of the  Company as of the  Effective  Date.  Fifty
percent (50%) of the Awarded Options shall vest and be exercisable  equally over
a five year period with 20% vesting beginning on the date that is one year after
the  Effective  Date (the "Time Vested  Options");  fifty  percent  (50%) of the
Awarded Options shall vest and be exercisable  over a five year period according
to annual performance criteria established by the Compensation  Committee of the
Board of Directors of the Company (the "Performance Options"). To the extent not
inconsistent with anything contained in this Agreement, the terms and conditions
of the Awarded Options shall be determined by the Compensation  Committee of the
Board of Directors of the Company.  Notwithstanding  the foregoing,  the Company
and the  Executive  agree to cooperate  to  restructure  the Awarded  Options as
restricted stock subject to repurchase, which shall have the same economic terms
as the Awarded Options.

                  3.4 Perquisites.  During the Employment  Period, the Executive
shall be  entitled  to (i) the use of an  automobile  and  reimbursement  by the
Company  for  all  expenses   relating  to  the   operation   thereof  and  (ii)
reimbursement  for  all  expenses  relating  to  the  Executive's  commuting  by
commercial airline between the San Jose and Los Angeles metropolitan areas.

                  3.5 Reimbursement of Expenses.  During the Employment  Period,
the
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Company  shall  reimburse  the  Executive  for  all  expenses   necessarily  and
reasonably incurred by her in connection with the business of the Company,  upon
presentation  of proper  receipts or other proof of  expenditure  and subject to
such reasonable  guidelines or limitations provided to the Executive and applied
prospectively, as established by the Company.

                  3.6  Vacation.  During the  Employment  Period,  the Executive
shall be entitled to paid  vacation  and sick leave in  accordance  with Company
policy.

                  3.7  Participation  in Benefit  Plans.  During the  Employment
Period,  the Executive  shall be entitled to  participate  in any profit sharing
plan,  retirement  plan,  group life insurance  plan or other  insurance plan or
medical  expense  plan  maintained  by the  Company  for its  senior  executives
generally,  which  plans  shall  not  differ in value in any  manner  materially
adverse  to  the  Executive   from  those  in  which  the  Executive   currently
participates. In addition, the Executive shall be reimbursed for all medical and
dental  expenses  that are not  covered  under  the  medical  and  dental  plans
otherwise covering the Executive.

         4.       Termination.

                  4.1 Death.  Upon the death of the  Executive,  the  Employment
Period shall  automatically  terminate  and all rights of the  Executive and her
heirs, executors and administrators to compensation and other benefits hereunder
shall  cease,  except for (i) Base Salary and any  prorated  Bonus earned by the
Executive  which  shall  have  accrued  to the date of death,  (ii) any  Awarded
Options which shall be  immediately  100% vested and  exercisable  and (iii) for
rights to indemnification under Section 6 hereof.

                  4.2 Disability.  The Company may, at its option, terminate the
Employment Period upon written notice to the Executive if the Executive, because
of physical or mental incapacity or disability, fails in any material respect to
perform the services  required of her hereunder  for a continuous  period of 120
days or any 180 days out of any  12-month  period.  Upon such  termination,  all
obligations of the Company hereunder shall cease, except for (i) Base Salary and
any prorated Bonus earned by the Executive  which shall have accrued to the date
of termination,  (ii) any Awarded Options which shall be immediately 100% vested
and  exercisable  and (iii) for the rights to  indemnification  under  Section 6
hereof.  In the event of any dispute  regarding the existence of the Executive's
incapacity  hereunder,  the matter shall be resolved by the  determination  of a
majority of three physicians  qualified to practice medicine in the state of the
Executive's residence, one to be selected by each of the Executive and the Board
and the  third  to be  selected  by such  two  designated  physicians.  For this
purpose, the Executive shall submit to appropriate medical examinations.

                  4.3      Cause.

                           (a) The Company  may, at its  option,  terminate  the
         Executive's employment under this Agreement for "Cause" (as hereinafter
         defined).  A  termination  for Cause  shall not take  effect  until and
         unless the Company  complies  with this Section  4.3(a).  The Executive
         shall  be  given  written  notice  by the  Board  of the  intention  to
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         terminate her employment hereunder for Cause (the "Cause Notice").  The
         Cause Notice shall state the particular action(s) or inaction(s) giving
         rise to termination  for Cause.  The Executive shall have 10 days after
         the  Cause  Notice  is  given  to  cure  the  particular  action(s)  or
         inaction(s),  to the extent a cure is  possible.  If the  Executive  so
         effects a cure,  the Cause Notice shall be deemed  rescinded  and of no
         force or effect.

                           (b) As used in this Agreement, the term "Cause" shall
         mean any one or more of the following:

                                    (i)  the  Executive's   refusal  to  perform
                           specific directives of the Board which are consistent
                           with the scope and nature of the  Executive's  duties
                           and responsibilities as set forth herein;

                                    (ii) the Executive's admission or conviction
                           of  a  felony  or  of  any  crime   involving   moral
                           turpitude,    fraud,    embezzlement,     theft    or
                           misrepresentation;

                                    (iii) any gross or willful misconduct of the
                           Executive   resulting  in  substantial  loss  to  the
                           Company  or  substantial   damage  to  the  Company's
                           reputation; or

                                    (iv) any breach by the  Executive of any one
                           or more of the covenants  contained in Section 7 or 8
                           hereof,  other than an inadvertent and  unintentional
                           breach of a covenant contained in Section 7 having an
                           inconsequential effect upon the Company or any of its
                           controlled affiliates.

                           (c) The  exercise  of the  right  of the  Company  to
         terminate  this  Agreement  pursuant  to this  Section  4.3  shall  not
         abrogate the rights or remedies of the Company in respect of the breach
         giving rise to such termination.

                           (d)  If  the  Company   terminates  the   Executive's
         employment for Cause, she shall be entitled to:

                                    (i) accrued Base Salary  through the date of
                           the termination of her employment;

                                    (ii) any  Bonus  owing  but not yet paid for
                           any fiscal  year  ended on or before the  Executive's
                           termination of employment for Cause;

                                    (iii)  any  amounts  owing  but not yet paid
                           pursuant to Sections 3.4 and 3.5; and

                                    (iv)  other  or   additional   benefits   in
                           accordance with applicable  plans and programs of the
                           Company  and  her  rights  to  indemnification  under
                           Section 6 hereof.
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                           (e)   Notwithstanding   anything   to  the   contrary
         contained  in  this  Agreement,  if,  following  a  termination  of the
         Executive's employment for Cause, a court of competent jurisdiction, in
         a final determination,  determines that the Executive was not guilty of
         the conduct that formed the basis for the  termination,  the  Executive
         shall be entitled to the payments and the  economic  equivalent  of the
         benefits she would have received had her employment  been terminated by
         the Company without Cause.

                  4.4  Termination  Without Cause.  If the Board  terminates the
employment  of the  Executive  hereunder  for any reason other than a reason set
forth in Section 4.1, 4.2 or 4.3:

                           (a)  such  termination  shall  be  effective  90 days
         following written notice thereof by the Company to the Executive;

                           (b)  concurrent  with such  termination,  the Company
         shall pay to the  Executive an amount equal to her Base Salary  accrued
         and any  prorated  Bonus  earned by the  Executive  through the date of
         termination;

                           (c) the Company  shall  continue to pay the Executive
         her Base Salary and all other  benefits  (excluding  Bonus) which would
         otherwise be payable  hereunder for a period of 18 months following the
         date of termination;

                           (d) all of the  Executive's  Awarded Options that are
         vested  at the  time of such  termination  shall  be  immediately  100%
         exercisable  and that portion of Time Vested  Options  which would vest
         and be  exercisable  within twelve months from the date of  termination
         shall vest and be immediately 100% exercisable and, if the criteria for
         the  Performance  Options has been met for the fiscal year during which
         the  termination  occurs  (calculated on an annualized  basis as of the
         date of such termination) that portion of the Performance Options which
         would  vest  and be  exercisable  in  such  fiscal  year  (but  for the
         Termination) shall vest and be 100% exercisable;

                           (e) the  Executive  shall be  entitled to any amounts
         owing but not yet paid pursuant to Section 3.4 or 3.5; and

                           (f) the Executive  shall be entitled to her rights to
         indemnification under Section 6 hereof.

                  4.5 Voluntary  Termination.  If, during the Employment Period,
the Executive  voluntarily  terminates her  employment  hereunder for any reason
whatsoever, such termination shall be effective 90 days following written notice
thereof by the Executive to the Company and the  Executive  shall be entitled to
the payments specified by Sections 4.4(b), (c), (e) and (f) hereof, inclusive.

                  4.6 Termination  for Good Reason.  The Executive may terminate
her employment  under this Agreement for Good Reason (as  hereinafter  defined),
upon notice to the 
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Company  setting forth in reasonable  detail the nature of such Good Reason.  In
the event the Executive terminates this Agreement for Good Reason, the Executive
shall be entitled to the  payments and  benefits  specified  by Sections  4.4(a)
through  4.4(f).  For  purposes of this  Agreement,  "Good  Reason"  shall mean,
without the Executive's  express written  consent,  the occurrence of any one or
more of the following events:

                           (a) the  material  breach  of this  Agreement  by the
         Company;

                           (b) a material  diminution of any of the  Executive's
         significant  duties or the  assignment  to the  Executive of any duties
         inconsistent  with  her  duties  or  the  material  impairment  of  the
         Executive's  ability to function in the positions  described in Section
         2.1  hereof,  in each case only  after the  Company  shall  have had an
         opportunity  to cure (any  cure to be  effected  within  30 days  after
         appropriate written notice of the basis for Good Reason is given to the
         Company by the Executive); or

                           (c) a material reduction of any benefit or perquisite
         enjoyed by the  Executive  or the failure to continue  the  Executive's
         participation  in  any  incentive  compensation  plan,  unless  a  plan
         providing a substantially  similar economic  opportunity is substituted
         or all senior  executives  suffer a substantially  similar reduction or
         failure.

         5.       Options to Purchase.

                  5.1 Call Option. Upon any termination of the employment of the
Executive,  the Company (or its  designee)  shall have the right to purchase and
upon exercise of such right the Executive shall have the obligation to sell, any
equity  interests in the Company held by the  Executive and  exercisable  at the
time of such  termination on the following terms (the "Call  Option");  it being
understood that all options and other  restricted  securities not exercisable at
the time of such  termination of employment (in accordance  with this Agreement)
will  be  terminated.   Upon  written  notice   delivered  within  one  year  of
termination,  the Company (or its  designee)  may purchase all or any portion of
any such equity  interests in the Company then held by the applicable  Executive
at a price equal to the Fair Market Value of such securities.

                  5.2 Put Right.  Upon the  termination of the employment of the
Executive,  the Executive shall have the right to sell to the Company,  and upon
exercise of such right the Company (or its designee)  shall have the  obligation
to purchase,  all or any portion of the equity  interests in the Company held by
the  Executive  it  being  understood  that all  options  and  other  restricted
securities  not  exercisable  at the time of such  termination of employment (in
accordance  with this Agreement) will be terminated at a price equal to the Fair
Market Value of such  securities  (the "Put Option").  Notice of an intention to
sell  securities  pursuant  to the Put Option must be  delivered  to the Company
within one year of the  termination of the Executive's  employment.  The Company
shall have no obligation to purchase any securities pursuant to this Section 5.2
if such  purchase is prohibited by or would give rise to any default or event of
default under the Company's financing documents; provided, however, that in such
circumstances the obligation to purchase  securities  pursuant to the Put Option
shall be extended until such time as such circumstances no longer exist.
<PAGE>
                  5.3  Determination  of Fair Market Value. For purposes of this
Section 5, the term "Fair  Market  Value" shall mean,  as of any date,  the fair
value as of the applicable date on the basis of a sale in an arms length private
sale  between  a  willing  buyer  and a willing  seller,  neither  acting  under
compulsion  (or,  in the case of an  option,  the fair  value of the  shares  of
capital  stock  that may then be  purchased  upon  exercise  thereof  minus  the
exercise price applicable thereto), as determined by the Board.

                  5.4  Termination.  The  provisions  of  this  Section  5  will
terminate upon an initial public offering of the Company's equity securities.

         6.  Indemnification.  To the  fullest  extent  permitted  by  law,  the
Restated Certificate of Incorporation of the Holding Company and the Articles of
Incorporation of the Operating Company, the Executive (and her heirs,  executors
and  administrators)  shall be indemnified by the Company and its successors and
assigns. The obligations of the Company pursuant to this Section 6 shall survive
the termination of the Employment Period.

         7.  Confidentiality.  The  Executive  shall  at all  times  during  the
Employment  Period and thereafter  hold in confidence  any and all  Confidential
Information  (as  hereinafter  defined)  that may have come or may come into her
possession or within her knowledge concerning the products, services, processes,
businesses,  suppliers,  customers and clients of the Company or its  controlled
affiliates.  The  Executive  agrees that neither he nor any person or enterprise
controlled by her will for any reason directly or indirectly, for herself or any
other person,  use or disclose any Confidential  Information,  provided that the
Executive  may  disclose  Confidential  Information  which has become  generally
available to the public other than as a result of a breach of this  Agreement by
the Executive or pursuant to an order of a court of competent jurisdiction or of
a  governmental  agency,  department  or  commission.  Upon  termination  of her
employment under this Agreement,  the Executive shall promptly  surrender to the
Company all documents he believes contain Confidential  Information and that are
within her possession or control, other than documents to which the Executive is
or was a party or that relate to the Executive or the basis, or purported basis,
on which her employment was terminated. For purposes of this Agreement, the term
"Confidential  Information"  shall  mean  any  trade  secrets,   proprietary  or
confidential information,  inventions,  manufacturing or industrial processes or
procedures,  patents,  trademarks,  trade names,  customer lists, service marks,
service names, copyrights, applications for any of the foregoing, or licenses of
other rights in respect  thereof,  owned or used by, or licensed to, the Company
or any of its controlled affiliates.

         8.       Restricted Activities.

                  8.1  Noncompetition.  The Executive  agrees that for two years
following the end of the Employment Period (the "Noncompete Period"),  she shall
not,  directly  or  indirectly,  engage in any  manner in any  activity  that is
directly or indirectly  competitive or potentially  competitive with the Company
or any of its affiliates or the business of the Company or any of its affiliates
as  conducted  or  planned  to be  conducted  during  the Term and  neither  the
Executive  nor  any  person  or  enterprise  controlled  by her  will  become  a
stockholder, co-venturer, lender,
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director,  officer, agent or employee of a corporation or member of or lender to
a partnership,  engage as a sole proprietor in any business, act as a consultant
to any of the  foregoing  or  otherwise  engage  directly or  indirectly  in any
business, that is in competition with the business then conducted by the Company
or any of its  affiliates in any state in the United States or any other country
in which the  Company or any of its  controlled  affiliates  has engaged in such
business  during the term of the  Executive's  employment  under this Agreement;
provided,  however,  that the foregoing  shall not prohibit the  Executive  from
owning  less than two  percent  of the  outstanding  securities  of any class of
capital stock of a corporation  the securities of which are regularly  traded or
quoted on a national securities exchange or on an inter-dealer quotation system.

                  8.2  Non-solicitation.  The Executive agrees that while she is
employed by the Company and during the  Noncompete  Period,  neither she nor any
person or enterprise controlled by her will (i) solicit for employment or employ
any  employee  of the  Company  or any of its  affiliates  or any person who was
employed  by the  Company or any of its  affiliates  at any time within one year
prior to the time of the act of solicitation,  (ii) in any way cause, influence,
induce,  encourage  or attempt to persuade any employee of the Company or any of
its  affiliates  or any person  who was  employed  by the  Company or any of its
affiliates  at any  time  within  one  year  prior  to the  time of such  act to
terminate her employment  relationship with the Company or any of its affiliates
or (iii) in any way, cause, influence,  induce, encourage or attempt to persuade
any customer or vendor of the Company or any of its  affiliates  to terminate or
diminish its relationship or violate any agreement with any of them.

                  8.3   Relief,   Reformation;   Severability.   The   Executive
acknowledges that she has carefully read and considered all terms and conditions
of this  Agreement,  including the restraints  imposed by Section 8 hereof.  The
Executive  acknowledges  that there is no adequate remedy at law for a breach of
this Section 8 and that, in the event of such a breach or attempted breach,  the
Company shall be entitled to injunctive or other equitable relief to prevent any
such breach,  attempted breach or continuing  breach,  without  prejudice to any
other remedies for damages or otherwise. The Executive agrees that the covenants
contained in this  Agreement  are separate and are  reasonable  in their nature,
subject matter, geographic limitation, scope and duration and that the Executive
shall not raise any issue of  reasonableness  as a defense in any  proceeding to
enforce any of such covenants.  Notwithstanding the foregoing, in the event that
a  covenant  contained  in this  Agreement  shall be  deemed  by any court to be
unreasonably  broad in any respect,  the parties agree that the court may modify
such  covenant for the purpose of making such  covenant  reasonable in scope and
duration.  The validity,  legality or enforceability of the remaining provisions
of this Agreement shall not be affected by any such modification.

         9.  Inventions.  The Executive hereby assigns to the Company her entire
right, title and interest in and to all discoveries and improvements, patentable
or otherwise,  trade  secrets and ideas,  writings and  copyrightable  material,
which may be conceived by the Executive or developed or acquired by her prior to
and during the term of the  Employment  Period,  which may  pertain  directly or
indirectly to the Company's business. The Executive agrees to disclose fully all
such  developments to the Company upon its request,  which  disclosure  shall be
made in writing promptly  following any such request.  The Executive shall, upon
the Company's request,
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execute, acknowledge and deliver to the Company all instruments and do all other
acts  which are  necessary  or  desirable  to  enable  the  Company  to file and
prosecute  applications for, and to acquire,  maintain and enforce, all patents,
trademarks and copyrights in all countries.

         10. Remedies.  The Executive  acknowledges  that any material breach of
this Agreement will cause  irreparable harm to the Company,  that such harm will
be difficult  if not  impossible  to  ascertain,  and that the Company  shall be
entitled  to  equitable  relief,  including  injunction,  against  any actual or
threatened breach hereof,  without bond and without liability should such relief
be denied, modified or vacated.  Neither the right to obtain such relief nor the
obtaining  of any such relief shall be exclusive of or preclude the Company from
any other remedy.

         11.  Insurance.  The Company  may, at its election and for its benefit,
ensure  the  Executive  against  disability,  accidental  loss or death  and the
Executive shall submit to such physical examinations and supply such information
as may be required in connection therewith.

         12.  Expenses.  The  Company  will  reimburse  the  Executive  for  her
reasonable  out of pocket  costs and  expenses of  obtaining  independent  legal
advice relating to the negotiation of this Agreement and the Executive's  equity
participation in Newco and the Surviving Corporation;  provided that the maximum
payment under this Section 12 shall not exceed $10,000.

         13.  Assignment.  The rights and  benefits of the  Executive  hereunder
shall not be  assignable,  whether by voluntary  or  involuntary  assignment  or
transfer. This Agreement shall be binding upon, and inure to the benefit of, the
successors   and  assigns  of  the  Company,   and  the  heirs,   executors  and
administrators  of the Executive,  and shall be assignable by the Company to any
entity  acquiring  substantially  all of the assets of the  Company,  whether by
merger, consolidation, sale of assets or similar transactions.

         14.  Notices.  Any notice  required or permitted to be given under this
Agreement  shall be sufficient if in writing and personally  delivered,  sent by
certified or registered mail or sent by overnight courier service as follows: if
to the Executive, to her address as set forth in the records of the Company with
a copy to Robert F. Wall,  Esq.,  35 West Wacker  Drive,  Suite  4700,  Chicago,
Illinois 60601, and if to the Company, to the address of its principal executive
offices,  attention: Chief Financial Officer, or to any other address designated
by any party hereto by notice similarly given.

         15.  Waiver of Breach.  A waiver by the Company or the Executive of any
breach of any  provision of this  Agreement by the other party shall not operate
or be  construed  as a waiver  of any  other or  subsequent  breach by the other
party.

         16. Entire Agreement.  This Agreement  contains the entire agreement of
the parties with respect to the subject  matter  hereof.  This  Agreement may be
modified only by an agreement in writing signed by the parties hereto.

         17.  Applicable  Law. The terms of this Agreement  shall be governed by
and construed
<PAGE>
in  accordance  with the  internal  laws (as  opposed  to the  conflict  of laws
provisions) of the State of Illinois.

         18. Prior  Agreements.  This Agreement  supersedes all prior agreements
between the Executive and the Company concerning the Executive's employment with
the Company,


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<PAGE>
including the Phantom Stock  Agreement,  and none of such agreements shall be of
any further force or effect whatsoever.

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

                                              BELL SPORTS CORP.



                                              By 
                                                 -------------------------------
                                                 Title:


                                              BELL SPORTS, INC.



                                              By 
                                                 -------------------------------
                                                 Title:



                                              EXECUTIVE:



                                              /s/ Mary J. George
                                              ----------------------------------
                                              Mary J. George