EXHIBIT 4.12

                            DATED 23 AUGUST 1999





                      NIAGARA LASALLE (UK) LIMITED (1)

                                  - and -

                  LOMBARD NATWEST DISCOUNTING LIMITED (2)



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


                       INVOICE DISCOUNTING AGREEMENT
                                relating to
       a committed invoice discounting facility of (pound)20,000,000

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















Ref : PAJ/RHH

Eversheds
115 Colmore Row
Birmingham  B3 3AL
DOC ID: BIRCORP 177826.9


                             TABLE OF CONTENTS
ClauseHEADING                                                      Page Number

1.    DEFINITIONS AND INTERPRETATION
1.1   Definitions
1.2   Headings
1.3   Interpretation

2.    INVOICE DISCOUNTING FACILITY
2.1   Invoice Discounting Facility
2.2   Additional Clients

3.    PURPOSE
3.1   Purpose of the Invoice Discounting Facility
3.2   Undertaking by the Clients
3.3   No liability

4.    CONDITIONS PRECEDENT
4.1   Conditions precedent
4.2   Confirmation of satisfaction

5.    AVAILABILITY OF INVOICE DISCOUNTING FACILITY
5.1   Clients' offer to sell
5.2   Purchase
5.3   Conditions to Payment
5.4   Facility Limit
5.5   Calculation of Available Amount
5.6   Variation of Global Deduction Percentage
5.7   Determination of Substantial Debt Deduction
5.8   Assignment of Purchased Receivables
5.9   Goods
5.10  Collection

6.    REMUNERATION
6.1   Determination of the Funding Amount
6.2   Discounting Charge
6.3   Calculation and Payment of Remuneration
6.4   Margin ratchet
6.5   Default Interest
6.6   Expenses
6.7   Records
6.8   LND's Determination

7.    TERMINATION, REPURCHASE AND CANCELLATION
7.1   Repurchase
7.2   Voluntary repurchase of Receivables
7.3   Cancellation of Invoice Discounting Facility
7.4   Repurchase Fees

8.    CHANGES IN CIRCUMSTANCES
8.1   Illegality
8.2   Certificates

9     PAYMENTS
9.1   Place and time
9.2   Funds
9.3   Business Days
9.4   Currency
9.5   Accounts as evidence
9.6   Partial payments
9.7   Set-off and counterclaim
9.8   Grossing-up

10.   SECURITY
10.1  Security Documents

11.   REPRESENTATIONS AND WARRANTIES
11.1  Representations and warranties
11.2  Repetition
11.3  LND warranty

12.   UNDERTAKINGS
12.1  Information undertakings
12.2  Positive undertakings
12.3  Negative undertakings
12.4  Financial undertakings

13.   DEFAULT
13.1  Default
13.2  Acceleration, etc.

14.   SET-OFF

15.   FEES AND EXPENSES
15.1  Expenses
15.2  Administration fees
15.3  Non Utilisation Fee
15.4  Documentary Taxes indemnity
15.5  VAT
15.6  Indemnity payments
15.7  Debiting authority

16.   WAIVERS: REMEDIES CUMULATIVE

17.   MISCELLANEOUS
17.1  Severance
17.2  Counterparts

18.   NOTICES
18.1  Method
18.2  Delivery
18.3  Deemed receipt

19.   ASSIGNMENTS AND TRANSFERS
19.1  Benefit of Agreement
19.2  Assignments and transfers by Clients
19.3  Assignments by LND
19.4  Transfers by LND
19.5  Disclosure of information

20.   INDEMNITIES
20.1  Currency indemnity
20.2  General

21.   LAW AND JURISDICTION
21.1  Law
21.2  Jurisdiction
21.3  Agent for service

22.   EUROPEAN AND MONETARY UNION
22.1  Monetary Union
22.2  Necessary Amendments

23.   ANNOUNCEMENTS

SCHEDULE 1        CONDITIONS PRECEDENT
SCHEDULE 2        FORM OF ACCESSION AGREEMENT
SCHEDULE 3        OFFER OF RECEIVABLES
SCHEDULE 4        SPECIFIC CONDITIONS
SCHEDULE 5        COMPLIANCE CERTIFICATE
SCHEDULE 6        SITES
SCHEDULE 7        LOCKBOX LETTER


THIS AGREEMENT is made on           23 August         1999

BY

(1) NIAGARA LASALLE (UK) LIMITED, a company incorporated in England and
Wales with registered number 3725308 and whose registered office is situate
at Victoria Steel Works, Bull Lane, Moxley, Wednesbury, West Midlands, WS10
8RS (the "INITIAL Client"); and

(2) LOMBARD NATWEST DISCOUNTING LIMITED a company incorporated in England
and Wales with registered number 943038 and whose registered office is at
Smith House, Elmwood Avenue, Feltham, Middlesex TW13 7WD ("LND").

IT IS AGREED as follows:

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

      1.1   DEFINITIONS
            -----------

            In this Agreement:


            "Accession Agreement"         means an agreement substantially
                                          in the form set out in Schedule 2;
            "Accounts"                    means:
                                          (a)   in relation to the Initial
                                          Client, its audited consolidated
                                          accounts (including all additional
                                          information included in, and notes
                                          to, the accounts) together with the
                                          relevant directors' report and
                                          auditors' report; and
                                          (b)   in relation to any other
                                          Group Company from time to
                                          time, its audited accounts
                                          (including all additional
                                          information included in, and
                                          notes to, the accounts) together
                                          with the relevant directors' report
                                          and auditors' report;
           "Acquisition"                  means the acquisition by the
                                          Initial Client of certain business
                                          and assets of Glynwed Steels
                                          Limited pursuant to the terms of the
                                          Acquisition Agreement;
           "Acquisition Agreement"        means the sale and purchase
                                          agreement (together with its
                                          schedules) dated 16 April 1999
                                          relating to the sale and
                                          purchase of the Target Assets and
                                          made between (1) Glynwed Steels
                                          Limited, (2) Glynwed International
                                          Plc, (3) the Initial Client and (4)
                                          the Holding Company;
           "Acquisition Documents"        means the Acquisition Agreement
                                          together with the related
                                          documents in respect of the
                                          Existing Properties but, for
                                          the avoidance of doubt, shall not
                                          include the Disclosure Letter;
           "Act"                          means the Companies Act 1985
                                          (as amended or substituted by
                                          the Companies Act 1989);
           "Adjusted Tangible Net Worth"  means (on a consolidated basis) the
                                          aggregate amount of the share capital
                                          of the Client paid up or credited as
                                          paid up (including, but not limited
                                          to, amounts standing to the credit
                                          of any share premium account or
                                          capital redemption reserve plus or
                                          minus the aggregate amount standing
                                          in the Client's capital and revenue
                                          reserves (on a consolidated basis)):-
                                          (a) adjusted to take account of any
                                          variation in the amount of such paid
                                          up share capital, share premium
                                          account or capital redemption reserve
                                          since the date to which such accounts
                                          have been made up;
                                          (b) excluding any capital accounts
                                          or reserves derived from any writing
                                          up of the book value of any assets of
                                          the Client above historic costs less
                                          accumulated depreciation at any time
                                          after the date of Completion;
                                          (c) excluding any provisions for
                                          deferred Taxation or deferred
                                          charges;
                                          (d) making such adjustments as may
                                          in the opinion of the Auditors be
                                          appropriate to reflect any variations
                                          which have  occurred since the date
                                          of the Accounts and to reflect any
                                          changes in GAAP since such date;
                                          (e) excluding exchange gains and
                                          losses arising on consolidation
                                          accounted for through reserves in
                                          accordance with SSAP20;
                                          (f) deducting any amounts
                                          attributable to any intangible asset
                                          (including but not limited to
                                          goodwill arising out of the
                                          Acquisition, trade marks or similar
                                          property) included as an asset in
                                          the Client's consolidated balance
                                          sheet;
                                          (g) excluding any profit or loss
                                          arising on the disposal of fixed
                                          assets;
                                          (h) excluding any minority interests
                                          arising on consolidation;
                                          (i) excluding Extraordinary Items
                                          since the date of Completion; and
                                          (j) adding back the amount of the
                                          Subordinated Loan and any accrued but
                                          unpaid interest arising thereon
                                          to the extent that such interest has
                                          been charged to the profit and loss
                                          account of the Client;
                                          (k) excluding adequate provision for
                                          pension contributions made by the
                                          Client in respect of Mr A Bagshawe's
                                          pension and in each case the relevant
                                          calculations, addition, deduction,
                                          exclusion or adjustment shall be
                                          made by reference to the then
                                          latest Accounts;
           "Advice Transmission"          means in relation to a
                                          Purchased Receivable, a modem
                                          transmission from the Client to LND
                                          in a form acceptable to LND;
           "Affiliate"                    means, in relation to any person,
                                          all associated companies,
                                          directors and relatives and companies
                                          in which such persons are
                                          interested;
           "Approved Currencies"          means each of:
                                          (a)   Sterling; and
                                          (b)   any other freely tradeable
                                          and convertible currency
                                          approved in writing by LND;
           "Auditors"                     means, in relation to the
                                          Client and each Group Company, BDO
                                          Stoy Hayward or any other firm of
                                          chartered accountants of
                                          internationally recognised standing
                                          that has been appointed as auditors
                                          of such Group Company;
           "Available Amount"             means the maximum aggregate
                                          amount available to be drawn
                                          down by the Clients under
                                          Clause 5.5 and for the time being
                                          undrawn;
           "Available Headroom"           means the aggregate amount, at
                                          any time, of:-
                                          (i)   the Available Amount; and
                                          (ii)  the Revolving Facility
                                          Available Amount (as such
                                          term is defined in the NWB
                                          Agreement); and
                                          (iii) any cash deposits held
                                          by the Client at LND; and
                                          (iv)  the loans to be made by
                                          the Holding Company to the Initial
                                          Client as referred to in
                                          Clause 12.2.20;
           "Base Rate"                    means NWB's base rate from
                                          time to time;
           "Borrowed Money"               means, in relation to the
                                          Initial Client (or the Holding
                                          Company or any of its Subsidiaries,
                                          as the context may require), any
                                          obligation for the payment
                                          or repayment of money (whether as
                                          principal or as surety and whether
                                          present or future, actual or
                                          contingent) incurred in respect of
                                          the following (but without double
                                          counting):
                                          (a) the principal amount of money
                                          borrowed or raised,
                                          (b) any bond, note, loan stock,
                                          debenture or similar instrument,
                                          (c) acceptance credit, documentary
                                          credit, bill discounting, factoring
                                          or note or purchase facilities,
                                          (d) deferred payments for assets
                                          or services acquired (other than on
                                          normal trade credit terms) where
                                          payment is due more than 4 months
                                          after the date of the acquisition of
                                          the goods or services in question,
                                          (e) rental payments under leases
                                          (whether in respect of land,
                                          machinery, equipment or otherwise)
                                          which are defined as Finance Leases
                                          but excluding rental payments
                                          under a lease of property which would
                                          not be treated as a Finance Lease;
                                          (f) counter indemnity obligations in
                                          respect of guarantees, bonds, standby
                                          letters of credit, or other
                                          instruments issued in connection
                                          with the performance of contracts by
                                          banks or other financial
                                          institutions,
                                          (g) payments under any hire, hire
                                          purchase, conditional, sale or
                                          instalment sale and purchase
                                          agreements but, for the avoidance of
                                          doubt, excluding any obligations
                                          lease;
                                          (h) guarantees or other assurances
                                          against financial loss in respect of
                                          indebtedness of any person falling
                                          within any of (a) to (g) above;
                                          (i) any interest swap or currency
                                          swap agreement or any other hedging
                                          or derivatives instrument or
                                          agreement; and
                                          (j) any other transaction having
                                          substantially the same commercial
                                          effect as any of the above;
           "Business Day"                 means a day (other than a Saturday
                                          or Sunday) on which banks and foreign
                                          exchange markets are open for
                                          business in: (a) London; and (b)
                                          in relation to a transaction
                                          involving an Approved Currency, in
                                          the principal financial centre of
                                          that Approved Currency;
           "Capital Expenditure"          means expenditure incurred (or as
                                          the case may be) to be incurred by
                                          the Client in the acquisition of
                                          buildings, plant, machinery or other
                                          fixed assets, businesses, shares in
                                          new subsidiaries and/or associated
                                          companies and any other investment or
                                          expenditure treated as capital
                                          expenditure in accordance with GAAP;
           "Certified Copy"               means, in relation to a document, a
                                          copy of that document bearing the
                                          endorsement  "Certified a true,
                                          complete and accurate copy of the
                                          original, which has not been amended
                                          otherwise than by a document, a
                                          Certified Copy of which is attached
                                          hereto" which has been signed and
                                          dated by a duly authorised officer of
                                          the relevant company and which
                                          complies with that endorsement;
           "Charging Group Companies"     means the Initial Client and
                                          each of its Subsidiaries which has
                                          granted, or is by the terms
                                          of this Agreement to grant, a
                                          Guarantee and Debenture and "Charging
                                          Group Company" shall be construed
                                          accordingly;
           "Clients"                      means the Initial Client and any
                                          other Charging Group Company
                                          that becomes a party to this
                                          Agreement pursuant to Clause
                                          2.2; and "Client" shall be
                                          construed accordingly;
<TABLE>
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           "Commencement Date"           means the date upon which LND notified the Initial
                                         Client that all of the conditions set out in Schedule
                                         1 have been satisfied or waived;
           "Commission Charge"           means the commission charge to be paid by the Initial
                                         Client under Clause 15.3;
           "Completion"                  means the completion of the sale and purchase of the
                                         Target Assets pursuant to the Acquisition Agreement;
           "Compliance Certificate"      has the meaning given to that term
                                         in Clause 12.1.6;
           "Cost of Funds"               means the cost to LND of obtaining Approved Currencies
                                         (other than Sterling) from such sources as it may select;
           "Current Assets"              means the aggregate value of the Client's assets which are
                                         treated as current assets in accordance with GAAP;
           "Current Liabilities"         means the aggregate value of the Client's liabilities which are
                                         treated as current liabilities in accordance with GAAP;
           "Customer"                    means the debtor in relation to a Purchased Receivable;
           "Debenture"                   means a debenture in the agreed form executed or to be
                                         executed by the Initial Client or any Group
                                         Company in favour of LND;
           "Deed of Priority"            means the deed of priority dated 23 August 1999 made between
                                         (1) LND, (2) National Westminster Bank Plc (as security
                                         agent for MTT), (3) MTT, (4) National Westminster Bank Plc
                                         (as lender under the NWB Agreement) (5) the Initial Client
                                         and (6) the Holding Company relating to the regulation of
                                         security granted by the Initial Client to both LND and NWB
                                         (as security agent for MTT);
           "Default"                     means any event specified as such in Clause 13.1;
           "Default Notice"              has the meaning given to that term in Clause 13.2;
           "Delivered                    means, in relation to Goods, their removal from the Client's
                                         premises and proof of shipment or delivery, as the case may be,
                                         having been received by the Client and, in relation to Services,
                                         fully performed "Deliver" and "Delivery" are to be similarly
                                         construed;
           "Disclosure Letter"           has the meaning given to that term in the Acquisition Agreement;
           "Discounting Charge"          means the discount charge to be paid by the Initial Client
                                         under Clause 6.2;
           "Discounting Documents"       means this Agreement and the Security Documents or any of
                                         them;
           "Discounting Rate"            means the aggregate of:
                                         (a)   the Base Rate (or, if applicable, the Cost of
                                         Funds); and
                                         (b)   the Margin;
           "Disposal"                    means a sale, transfer or other disposal (including by way of
                                         lease or loan) by a person of all or part of its assets, whether
                                         by one transaction or a series of transactions and whether at
                                         the same time or over a period of time;
           "Dormant Subsidiary"          means, on any given date, a Group Company, (a) which has been
                                         dormant within the meaning of section 250(3) of the Act for
                                         a period of 12 months ending on that date and (b) the value of
                                         whose assets does not exceed in aggregate(pound)5,000;
           "Electronic Transmission"     means telegraphic transfers and any method pursuant to which
                                         payments can be made through the inter bank payments system;
           "Environmental Law"           means all or any statutes, directives, regulations,
                                         codes of practice or conduct, circulars and guidance notes
                                         and rules of law relating to or concerning:-
                                         (a)   pollution or protection of the environment or the health
                                         of humans, animals or plants; or
                                         (b)   workers' health and safety; or
                                         (c) the manufacture, processing, distribution, use, treatment,
                                         storage, disposal, emission, release or discharge into the
                                         environment of any hazardous substance;
           "Exceptional Items"           has the meaning given to that term in FRS3, but excluding those
                                         items listed in paragraph 20 of FRS3;
           "Existing Properties"         means the properties the subject of Leases;
           "Extraordinary Items"         has the meaning given to that term in FRS3, but including those
                                         items listed in paragraph 20 of FRS3 and, for the avoidance of
                                         doubt, shall include the reorganisation costs charged to profit
                                         relating to the closure of Ductile Hot Mill and the partial
                                         closure of Dudley Port Rolling Mill, limited to a maximum amount
                                         of(pound)1,500,000 (one million five hundred thousand pounds
                                         Sterling);
           "Facility Limit"              means (pound)20,000,000 (twenty million pounds Sterling);
           "Finance Lease"               means any lease, hire agreement, credit sale agreement, hire
                                         purchase agreement, conditional sale agreement or
                                         instalment sale and purchase agreement which should be
                                         treated in accordance with SSAP 21 (or any successor to
                                         SSAP 21) as a finance lease or in the same way as a
                                         finance lease;
           "Financial Year"              in relation to a company, has the meaning given to that
                                         expression in section 223 of the Act;
           "FRS"                         together with a number means the financial reporting standard
                                         issued by the Accounting Standards Board for application in England and
                                         Wales and identified by reference to that number;
           "Funding Amount"              means the amount calculated under Clause 6.1;
           "GAAP"                        means, in relation to a company, accounting principles,
                                         concepts, bases and policies generally adopted and accepted in the
                                         jurisdiction of its incorporation;
           "Global                       Deduction Percentage" means 25% (twenty five per cent) in relation
                                         to Receivables purchased by LND (or such other percentage calculated in
                                         accordance with Clause 5.6);
           "Goods"                       means goods provided by a Client in relation to which a
                                         Purchased Receivable is created;
           "Group"                       means the Initial Client and each of its Subsidiaries and "Group
                                         Company" means any one of them;
           "Guarantee"                   means a guarantee in the agreed form executed or to be
                                         executed by the Holding Company in favour of LND;
           "Holding Company"             means Niagara Corporation, a Delaware corporation having
                                         its principal office at 667 Madison Avenue, New York, New York 10021,
                                         United States of America;
           "Intercreditor Agreement"     means the intercreditor agreement to be made between (1) LND,
                                         (2) the Holding Company and (3) the Initial Client relating to the
                                         Subordinated Loan made available by the Holding Company to the
                                         Initial Client;
           "Interest"                    means in respect of the Client in relation to a period of time,
                                         the aggregate of:-
                                         (a) interest from time to time charged by NWB under and in respect of
                                         the NWB Agreement and the Discounting Charge charged by LND from time
                                         to time under this Agreement or any other facility made available by
                                         LND or NWB from time to time to the Client;
                                         (b) interest, commissions, periodic fees and other financing
                                         charges on any other indebtedness payable (on an accrued basis)
                                         by the Client during that period including the interest element
                                         of hire purchase and Finance Leases but excluding any amounts
                                         amortised on finance costs arising from completion of the
                                         Acquisition;
                                         (c) the consideration given by the Client during that period
                                         whether by way of discount or otherwise in connection with
                                         finance for the Holding Company or any of its Subsidiaries (other
                                         than the Client) by way of acceptance credit bill discounting
                                         debt factoring or other like arrangement;
                                         (d) excluding any interest received or receivable;
                                         (e) less any sums receivable or plus any sum paid or due, owing
                                         or incurred by the Client under any interest rate protection
                                         agreement of whatever description during such period; and
                                         (f) less any interest accrued (to the extent not paid) in respect
                                         of the Subordinated Loan; (but so that there will be no double
                                         counting of any of the above items);
           "Invoice Discounting          means the invoice discounting facility of (pound)20,000,000
                Facility"                (twenty million pounds Sterling) referred to in Clause 2.1;
           "Leases"                      means the various leasehold interests acquired by the
                                         Initial Client pursuant to :
                                         (a) a property agreement dated 16 April 1999 and made between (1)
                                         Glynwed Property Management Limited, (2) Glynwed Properties
                                         Limited, (3) the Initial Client, (4) the Holding Company and (5)
                                         Glynwed International plc; and
                                         (b) an agreement for lease dated 16 April 1999 and made between
                                         (1) Glynwed Property Management Limited, (2) Glynwed Properties
                                         Limited, (3) the Initial Client and (4) the Holding Company;
           "Listing"                     means the listing of any shares in the share capital of the
                                         Initial Client or any Group Company on any recognised investment
                                         exchange (as defined by section 207 of the Financial
                                         Services Act 1986);
           "Management Accounts"         has the meaning given to that term in Clause 12.1.2;
           "Margin"                      means 2.25% (two hundred and twenty five basis points)  per
                                         annum;
           "Material Adverse Change"     means any change which is, in the reasonable opinion of LND,
                                         likely to be adverse to the ability of any Client to perform its
                                         material obligations under this Agreement or under any of the
                                         other Discounting Documents as and when such obligations fall
                                         due;
           "Material Company"            means the Initial Client and each of its Subsidiaries:
                                         (i) whose profits are equal to or greater than 5 per cent of the
                                         aggregate profits of the Group; or
                                         (ii) whose turnover is equal to or greater than 5 per cent of the
                                         aggregate turnover of the Group; or (iii) whose assets have a
                                         value equal to or greater than 5 per cent of the aggregate value
                                         of all assets owed by the Group; For the purposes of paragraphs
                                         (i) and (ii) above, profits and turnover shall be measured over a
                                         period of at least 6 months duration ending on a Quarter Date;
           "Memorandum Discounting       means the accounts in the name of the Clients held at LND in
                Statements"              order to calculate the Discounting Charge  or any of them, as the
                                         context may require;
           "MTT"                         means Manufacturers & Traders Trust Company, a New York
                                         banking corporation whose principal place of business is at One
                                         Fountain Plaza, Buffalo, New York 14203-1495;
           "NWB"                         means National Westminster Bank plc and its successors in
                                         title, assignees and transferees;
           "NWB Agreement"               means the term and revolving loan facility agreement dated 21
                                         May 1999 between (1) NWB and (2) the Initial Client;
           "NWB Facility"                means the term and revolving loan facility of up to a maximum
                                         principal amount of (pound)19,800,000 (nineteen million eight
                                         hundred thousand pounds Sterling) provided by NWB to the Initial
                                         Client as reduced by repayments, prepayments or cancellations
                                         under the terms of the NWB Agreement;
           "NWB Lending Documents"       has the meaning given to the term "Lending Documents" in the NWB
                                         Agreement;
           "OECD"                        means the Organisation for Economic Co-operation & Development or
                                         any body replacing the same;
           "Offer"                       means a written offer, in the form set out in Schedule 3 by the
                                         Initial Client to LND to sell each of its Receivables to LND with
                                         full title guarantee;
            "Party"                      means a party to this Agreement;
            "PBIT"                       means, in relation to the Client and period for which the
                                         calculation is made, profit on ordinary trading activities
                                         (including but not limited to Exceptional Items and credit
                                         interest receivable in respect of positive cash balances) before
                                         Tax and Interest excluding:
                                         (a) amounts written off the value of investments;
                                         (b) profit attributable to minority interests;
                                         (c) amounts written off the value attributed to goodwill arising
                                         out of the Acquisition;
                                         (d)   any Extraordinary Items;
                                         (e)   any profit or loss arising on the disposal of fixed assets;
                                         (f) income from participating interests in associated
                                          undertakings and income from any other fixed asset investments;
                                         (g) acquisition expenses required to be capitalised in accordance
                                         with paragraph 85 of FRS7;
                                         (h)   any realised or unrealised exchange gains and losses;
                                         any costs associated with the Acquisition
                                         PROVIDED ALWAYS THAT no item should be counted more than once and
                                         Interest shall be excluded;
           "Permitted Borrowed Money"    means:
                                         (a) Borrowed Money under any of the NWB Lending Documents;
                                         (b) Borrowed Money under any of the Discounting Documents;
                                         (c) Borrowed Money specifically approved by LND in the budgets
                                         approved by LND;
                                         (d) Borrowed Money incurred with the prior written consent of
                                         LND;
                                         (e) Borrowed Money under any Finance Lease where the aggregate
                                         amount of such obligations does not exceed (pound)400,000 in any
                                         one Financial Year;
                                         (f) Borrowed Money under the Subordinated Loan;
                                         (g) Borrowed Money of (i) the Initial Client to a Subsidiary of
                                         the Initial Client or (ii) of a Subsidiary of the Initial Client
                                         to the Initial Client or (iii) of a Subsidiary of the Initial
                                         Client to another Subsidiary of the Initial Client, provided that
                                         in all cases LND has received security from such Subsidiaries
                                         pursuant to Clause 12.2.24;
                                         (h) Borrowed Money in respect of non-interest bearing loans
                                         (which are, subject to the terms of the Intercreditor Agreement,
                                         repayable on demand) made on an unsecured basis by the Holding
                                         Company to the Initial Client provided that:-
                                           (i) such loans shall not exceed, at any time, a principal
                                         amount in excess of (pound)5,000,000 in aggregate;
                                            (ii) the Initial Client shall be entitled to repay any
                                         amounts outstanding under such loans unless at such time (i)
                                         any payment of any amount payable under this Agreement has
                                         not be paid on its due date; or (ii) the financial covenants
                                         contained in Clause 12.4 have not been met or (iii) a
                                         Default or Potential Default has occurred and is continuing
                                         or (iv) the effect of such repayment would mean that the
                                         amount of the Available Headroom would reduce below
                                         (pound)2,500,000 (two million five hundred thousand pounds
                                         sterling);
                                         (i) the UK Guarantee and the Reimbursement Agreement (as
                                         such terms are defined in the NWB Agreement);
            "Permitted Disposal"         means any sale, transfer, lease, loan or disposal of any Asset
                                         (excluding any Current Assets) of the Clients or any of their
                                         Subsidiaries on terms whereby:-
                                         (i) the proceeds of such sale, transfer, lease loan or disposal are
                                         re-invested in the business of the Clients (or the relevant
                                         Subsidiary) within 3 months of the date of such transaction; or
                                         (ii) the proceeds of such sale, transfer, lease, loan or disposal are
                                         used to repurchase the Purchased Receivables on the next Remuneration
                                         Payment Date following such transactions; or
                                         (iii) the proceeds of such sale, transfer, loan or disposal do not
                                         exceed(pound)100,000 in aggregate in any one Financial Year; or the
                                         sale or disposal of stock-in- trade or inventory sold or disposed of
                                         in the ordinary course of trading;
            "Permitted Security          means:
                Interest"                (a) any Security Interest created under the NWB Lending
                                         Documents; and
                                         (b) any Security Interest created under any of the Discounting
                                         Documents;
           "Potential Default"           means an event or omission which, with the giving of any notice,
                                         the lapse of time (or any combination thereof) would, in the
                                         reasonable opinion of LND, constitute a Default;
           "Purchased Receivable"        means each Receivable other than any Unpurchased Receivable;
           "Quarter Days"                means 31st March, 30th June, 30th September and 31st December;
           "Receivable"                  means any present, future or contingent obligation of a
                                         Customer to make payment under a contract for the sale of Goods
                                         or performance of Services (together with all rights that the
                                         Client may have in relation thereto) (or where the context allows
                                         a part of such obligation or its related rights), including:-
                                         (i) the future right to recover sums due following the
                                         determination, assessment or agreement of the amount of the
                                         obligation; and
                                         (ii)  VAT; and
                                         (iii) all duties and charges;
            "Receivables Purchased       means the accounts in the  name of the Clients held at LND which
               Accounts"                 record the prospective purchase price of the Purchased Receivables
                                         or any of them, as the context may require;
            "Remittances"                means cash, cheques, bills of exchange, negotiable and non-
                                         negotiable instruments, letters of credit, orders, drafts,
                                         promissory notes, electronic payments and any other instruments,
                                         methods or forms of payment or engagement received by LND or the
                                         Initial Client or any agent of the Initial Client towards a
                                         Receivable;
            "Remuneration Payment Date"  means in relation to each  calendar month the last Business Day of
                                         such period;
            "Security Documents"         means:
                                         (a) the Guarantee and any further guarantee executed by a Group
                                         Company pursuant to clause 12.2.24;
                                         (b) the Debenture executed by the Initial Client and any further
                                         debenture executed by a Group Company pursuant to clause 12.2.24;
                                         (c) the Intercreditor Agreement and the Deed of Priority; and (d)
                                         any guarantee and any document creating security executed and
                                         delivered after the date of this Agreement as security for any of
                                         the obligations and liabilities of any Client and the other Group
                                         Companies under any Discounting Document;
            "Security Interest"          means any mortgage, charge (whether fixed or floating), pledge,
                                         hypothecation, lien (other than liens arising in the ordinary
                                         course of business by operation of law), encumbrance, trust
                                         arrangement, preferential creditor's right (other than such a
                                         right arising under the general law for the protection of certain
                                         classes of creditors) or other agreement or arrangement, the
                                         effect of any of which is the creation of security or any other
                                         security interest, however created or arising;
            "Security Period"            means the period starting on the date of this Agreement and
                                         ending on the date on which all of the obligations and
                                         liabilities of the Initial Client under each Discounting Document
                                         are discharged in full and LND has no continuing obligations in
                                         relation to this Agreement;
            "Services"                   means services provided by the Clients in relation to which a
                                         Purchased Receivable is created;
            "Sites"                      means the premises listed in Schedule 6 and "Site" shall be
                                         construed accordingly;
            "Specific Conditions"        means conditions specific to individual Sites as set out in
                                         Schedule 4 hereto;
            "SSAP"                       together with a number means the statement of standard accounting
                                         practice issued by the Institute of Chartered Accountants for
                                         application in England and Wales and identified by reference to
                                         that number;
           "Sterling" and "(pound)"      mean the lawful currency for the time being of the United
                                         Kingdom;
           "Sterling Funding Amount"     means, in respect of any day on which the Funding Amount is
                                         calculated from time to time, the aggregate of all Funding
                                         Amounts, where Funding Amounts which are not in Sterling are
                                         calculated at their equivalent in Sterling using NWB's relevant
                                         spot rate of exchange on that date;
           "Subordinated Loan"           means the principal sum of (pound)3,750,000 (three million
                                         seven hundred and fifty thousand pounds sterling) lent by the
                                         Holding Company to the Initial Client pursuant to the terms of
                                         the Intra Group Loan Agreement (as defined in the NWB Agreement);
           "Subsidiary "                 means a subsidiary or subsidiary undertaking within the
                                         meaning of sections 736, 258 and 742(1) of the Act;
           "Substantial Debt             means, in relation to any Customer, the amount as determined under
             Deduction"                  Clause 5.7;
           "Substantial Receivable"      means the aggregate of the Purchased Receivables from an
                                         individual Customer that exceeds 25 per cent of the aggregate of
                                         the Purchased Receivables from all Customers from time to time;
           "Target Assets"               means the business and assets acquired by the Initial Client
                                         pursuant to the Acquisition Agreement;
           "Taxes"                       includes all present and future governmental taxes, charges,
                                         imposts, duties, levies, deductions, withholdings or fees of any
                                         kind whatsoever, or any amount payable on account of or as
                                         security for any of the foregoing, by whomsoever on whomsoever
                                         and wherever imposed, levied, collected, withheld or assessed,
                                         together with any penalties, additions, fines, surcharges or
                                         interest relating thereto; and "Tax" and "Taxation" shall be
                                         construed accordingly;
           "Term Loan"                   has the meaning given to that term in the NWB Agreement;
           "Termination Date"            means the third anniversary of Commencement Date or such
                                         later date as is agreed in writing between the Initial Client (on
                                         behalf of the Clients) and LND under Clause 7.1;
           "Transaction Documents"       means, in relation to a Group Company, each of the following
                                         documents to which it is a party: the NWB Lending Documents, the
                                         Discounting Documents, the Acquisition Documents;
           "Unpurchased Receivable"      means:
                                         (a) any Receivable not denominated in an Approved Currency;
                                         (b) any Receivable where the debtor is an Affiliate of any Client
                                         or the Holding Company or any of its Subsidiaries;
                                         (c) any Receivable arising from the conduct of trading activities
                                         of a Client other than those undertaken at the date of this
                                         Agreement or which LND has approved in writing;
                                         (d) any Receivable where British Steel Plc or any Subsidiary of
                                         British Steel Plc is the Customer;
                                         (e) any Receivable the subject of payment in cash or where payment
                                         is made by the Customer in advance of an invoice being issued by the Client;
                                         (f) Receivables where the debtor is resident or domiciled in a country
                                         which is not a member of the OECD;
                                         (g) Receivables where the payment obligation of a Customer is secured
                                         by a letter of credit payable upon sight;
           "US Lockbox Account"          means the account held by the Initial Client at MTT and
                                         numbered 8700343711;
           "VAT"                         means value added tax as provided for in the Value Added Tax Act
                                         1994 and legislation (or purported legislation and whether
                                         delegated or otherwise) supplemental to that Act or in any
                                         primary or secondary legislation promulgated by the European
                                         Community or any official body or agency of the European
                                         Community, and any tax similar or equivalent to value added tax
                                         imposed by any country other than the United Kingdom and any
                                         similar or turnover Tax replacing or introduced in addition to
                                         any of the same;
           "Year 2000 Compliant"         means complying with the Year 2000 conformity requirements
                                         promulgated by the British Standard Institution whose definition
                                         is as follows:-
                                         Year 2000 conformity shall mean that neither performance nor
                                         functionality is affected by dates prior to, during and after
                                         Year 2000, and in particular:-
                                         Rule 1 no value for current data will cause any interruption in
                                         operation;
                                         Rule 2 data-based functionality must behave consistently for
                                         dates before, during and after Year 2000;
                                         Rule 3 in all interfaces and data storage, the century in any
                                         date is specified either explicitly or by unambiguous algorithm
                                         or interfacing rules; and
                                         Rule 4 Year 2000 must be recognised as a leap year.
</TABLE>

      1.2   Headings
            --------

      The headings in this Agreement are for convenience only and shall be
      ignored in construing this Agreement.

      1.3   Interpretation
            --------------

            In this Agreement (unless otherwise provided):

            1.3.1  words importing the singular shall include the plural and
                   vice versa;

            1.3.2  references to Clauses and Schedules are to be construed
                   as references to the clauses of, and schedules to, this
                   Agreement;

            1.3.3  references to any Discounting Document or any other
                   document shall be construed as references to that
                   Discounting Document or that other document, as amended,
                   varied, novated or supplemented, as the case may be;

            1.3.4  references to any statute or statutory provision include
                   any statute or statutory provision which amends, extends,
                   consolidates or replaces the same, or which has been
                   amended, extended, consolidated or replaced by the same,
                   and shall include any orders, regulations, instruments or
                   other subordinate legislation made under the relevant
                   statute;

            1.3.5  references to a document being "in the agreed form" means
                   that document the form and content of which has been
                   approved by LND and which has endorsed on it the words "in
                   the agreed form" and which is initialled by or on behalf of
                   LND and the Initial Client;

            1.3.6  references to "assets" shall include revenues and the
                   right to revenues and property and rights of every kind,
                   present, future and contingent and whether tangible or
                   intangible (including uncalled share capital);

            1.3.7  the words "including" and "in particular" shall be
                   construed as being by way of illustration or emphasis
                   only and shall not be construed as, nor shall they take
                   effect as, limiting the generality of any foregoing
                   words;

            1.3.8  the words "other" and "otherwise" shall not be construed
                   ejusdem generis with any foregoing words where a wider
                   construction is possible;

            1.3.9  references to a "person" shall be construed so as to
                   include that person's assigns, transferees or successors
                   in title and shall be construed as including references
                   to an individual, firm, partnership, joint venture,
                   company, corporation, unincorporated body of persons or
                   any state or any agency of a state;

            1.3.10 where there is a reference in this Agreement to any
                   amount, limit or threshold specified in Sterling, in
                   ascertaining whether or not that amount, limit or
                   threshold has been attained, broken or achieved, as the
                   case may be, a non-Sterling amount shall be counted on
                   the basis of the equivalent in Sterling of that amount
                   using NWB's relevant spot rate of exchange;

            1.3.11 accounting terms shall be construed so as to be consistent
                   with GAAP;

            1.3.12 references to time are to London time; and

            1.3.13 the obligations and liabilities of the Clients in this
                   Agreement are joint and several obligations and
                   liabilities of the Clients.

2.    INVOICE DISCOUNTING FACILITY
      ----------------------------

      2.1   Invoice Discounting Facility
            ----------------------------

            Subject to the terms of this Agreement LND agrees to make
            available to the Client an invoice discounting facility of a
            maximum amount of (pound)20,000,000 (twenty million Pounds
            Sterling).

      2.2   Additional Clients
            ------------------

            2.2.1 The Initial Client may, on giving written notice to LND,
                  nominate a Charging Group Company incorporated in England
                  and Wales as an additional Client.

            2.2.2 A Charging Group Company wishing to become an additional
                  Client shall execute and deliver an Accession Agreement
                  to LND together with all the documents referred to in the
                  schedule to that Accession Agreement, each in form and
                  substance satisfactory to LND.

            2.2.3 A Charging Group Company shall accede to this Agreement
                  as a Client on LND counter-signing the relevant Accession
                  Agreement.

3.    PURPOSE
      -------

      3.1   Purpose of the Invoice Discounting Facility

            The proceeds of the Invoice Discounting Facility shall only be
            used:

            3.1.1 as to a maximum principal amount of (pound)9,800,000 (or
                  such lesser amount as shall be agreed between the Initial
                  Client and LND) to repay or prepay any amounts
                  outstanding under the Revolving Facility (as defined in
                  the NWB Agreement); and

            3.1.2 as to the balance, for general working capital and
                  corporate purposes of any Client.

      3.2   Undertaking by the Clients
            --------------------------

            Each Client undertakes that it will only utilise the Invoice
            Discounting Facility as permitted by this Clause 3.

      3.3   No liability
            ------------

            LND shall not be concerned as to the use or application of
            amounts made available under the Invoice Discounting Facility.

4.    CONDITIONS PRECEDENT
      --------------------

      4.1   Conditions precedent
            --------------------

            Notwithstanding any other term of this Agreement, LND shall not
            be under any obligation to make the Invoice Discounting
            Facility available to the Clients and the Clients will be under
            no obligation to make any payment under this Agreement unless
            LND has notified the Initial Client that all the conditions set
            out in Schedule 1 have been satisfied on or before 31 August
            1999 (or such later date as LND and the Initial Client shall
            agree).

      4.2   Confirmation of satisfaction
            ----------------------------

            At the request of the Initial Client, LND shall certify whether
            or not any one or more of the conditions set out in Schedule 1
            have been satisfied or, as the case may be, waived.

5.    AVAILABILITY OF INVOICE DISCOUNTING FACILITY
      --------------------------------------------

      5.1   Clients' offer to sell
            ----------------------

            On or before the Commencement Date the Initial Client (on
            behalf of each of the Clients) shall deliver an Offer to LND.
            If LND wishes to accept such an Offer, it shall do so by
            crediting the face value of the invoice for the relevant
            Receivable to the Receivables Purchased Account when title to
            each such Receivable shall pass to LND.

      5.2   Purchase
            --------

            5.2.1 After operation of Clause 5.1, the Clients will, during
                  the period of this Agreement, deliver offers to LND by
                  notifying LND of Receivables available for purchase on an
                  ongoing basis by way of Advice Transmissions. LND shall
                  purchase (and the relevant Client will sell with full
                  title guarantee) each Purchased Receivable immediately
                  upon the Purchased Receivable coming into existence free
                  from all Security Interests upon the terms of this
                  Agreement by crediting the face value of the invoice to
                  the relevant Receivables Purchased Account. Any such sale
                  and purchase shall be an absolute sale and purchase and
                  the rights to the relative Purchased Receivable shall
                  vest in LND. The balance standing to the credit of the
                  Receivables Purchased Account shall be LND's record of
                  the prospective purchase price of the Purchased
                  Receivables before any of the deductions used under
                  Clause 5.2.2 to calculate the purchase price.

            5.2.2 The price payable for each Purchased Receivable covered
                  by this Agreement is to be the amount received by LND
                  towards the discharge of the Purchased Receivable but less:-

                  5.2.2.1     any Customers prompt settlement discount later
                              claimed (if any) relating to such Receivable; and

                  5.2.2.2     any other later claimed Customer deductions,
                              abatement or set-off relating to such Receivable;
                              and

                  5.2.2.3     the Discounting Charge and Commission Charges
                              relating to such Receivable; and

                  5.2.2.4     all other sums due to LND under this Agreement
                              to the extent not otherwise satisfied.

            5.2.3 For the avoidance of doubt, the Invoice Discounting
                  Facility is made available on a recourse basis only (so
                  that the Clients shall indemnify and keep indemnified LND
                  against any non-payment by the Customer in respect of any
                  Purchased Receivables) and LND shall not be obliged to
                  purchase at any time any Receivable falling within the
                  definition of "Unpurchased Receivable".

      5.3   Conditions to Payment
            ---------------------

            5.3.1 LND shall establish a Receivables Purchased Account and
                  Memorandum Discounting Statement for each Approved
                  Currency and in respect of each Site.

            5.3.2 LND shall pay by Electronic Transmission, all (or such
                  part of the Available Amount as is required by the
                  relevant Client) of the relative Approved Currency to a
                  Client, on written demand by that Client, on or before
                  10.30 a.m. (London time) on any Business Day if:

                  5.3.2.1     all of the Conditions Precedent have been
                              satisfied or otherwise waived in writing by LND;

                  5.3.2.2     the matters represented and warranted, or
                              deemed to be represented and warranted under
                              Clause 11.1 inclusive, are true and accurate
                              at the relevant time;

                  5.3.2.3     the Invoice Discounting Facility has not
                              expired nor has demand been made on the Clients
                              under Clause 13.2;

                  5.3.2.4     no Default or Potential Default is outstanding;

                  5.3.2.5     the Sterling Funding Amount does not, and
                              will not by such payment, equal or exceed the
                              Facility Limit; and

                  5.3.2.6     the Client has provided to LND an Advice
                              Transmission in relation to the relative
                              Receivable.

            5.3.3 The Available Amount in relation to each Approved
                  Currency shall only be available in the relative Approved
                  Currency.

            5.3.4 To the extent that any Memorandum Discounting Statement
                  has a credit balance on:-

                  (a)   the Termination Date; or

                  (b)   the date of the termination of the Facility under
                  Clause 7.2;

                  LND shall promptly account for such credit balance to the
                  Clients arising after the exercise of the rights of
                  set-off available to LND under Clause 14.

            5.3.5 Payments made under this Clause 5.3 shall, unless
                  otherwise instructed in writing by the relevant Client
                  acting by any director, be made to NWB at 103 Colmore
                  Row, Birmingham B3 3NR (Sort Code : 60-00-04) for the
                  accounts specified in respect of the relevant Site, in
                  Column B below in relation to the Approved Currency
                  specified opposite in Column A below:


                  COLUMN A              Column B
                  --------              --------

                  Deutschemark          Account No : 08047618 (Ductile
                                        Hot Mill), Account No : 08047561
                                        (Gadd Dudley Port), Account No :
                                        08047502 (GB Longmores), Account
                                        No 08047421 (W. Wesson);

                  Euro                  Account No : 08047634 (Ductile
                                        Hot Mill), Account No : 08047553 (GB
                                        Longmores) Account No : 08047642
                                        (Midland Engineers), Account No:
                                        08047499 (W. Wesson);

                  Swedish Krona         Account No : 08047537 (GB
                                        Longmores), Account No :
                                        08047464 (W. Wesson);

                  US Dollar             Account No : 08047065 (Ductile
                                        Hot Mill), Account No : 08047057
                                        (Gadd Dudley Port), Account No :
                                        08047081 (GB Longmores), Account
                                        No : 08047073 (Midland
                                        Engineering), Account No :
                                        08047049 (W. Wesson);

                  Danish Krona          Account No : 08047448 (W.
                                        Wesson);

                  French Franc          Account No : 08047596 (Gadd
                                        Dudley Port), Account No :
                                        08047510 (GB Longmores), Account
                                        No : 08047413 (W. Wesson);

                  Italian Lira          Account No : 08047626 (Ductile
                                        Hot Mill), Account No : 08047588
                                        (Gadd Dudley Port), Account No :
                                        08047529 (GB Longmores), Account
                                        No : 08047456 (W. Wesson);

                  Dutch Guilder         Account No : 08047545 (GB
                                        Longmores), Account No :
                                        0804748 ( W. Wesson);

                  Norwegian Krona       Account No : 08047472 (W.
                                        Wesson);


                  and in respect of any other Approved Currency to such
                  account at NWB notified in writing by the Initial Client
                  to LND from time to time and, in relation to any other
                  Client to the bank and account specified in relation to
                  the Approved Currency in its Accession Agreement.

            5.3.6 Payments made under this Clause 5.3 shall be debited to
                  the relevant Receivables Purchased Account and to the
                  relevant Memorandum Discounting Statement. All other sums
                  due, owing or incurred by the Clients to LND may also be
                  debited to the relevant Receivables Purchased Account and
                  the relevant Memorandum Discounting Statement. The value
                  of any Remittance received by LND will be credited to the
                  relevant Memorandum Discounting Statement with an
                  effective date for the purposes of calculating the
                  Discounting Charge as follows :-

                  5.3.6.1     if in cleared funds, by Electronic
                              Transmission, to LND's bank account as
                              notified to the Client, the same Business Day
                              that LND receives the Remittance;

                  5.3.6.2     for any other Remittances, three calendar
                              days after the date of lodgement by the
                              Client of such Remittance.

                  The balance on the relevant Memorandum Discounting
                  Statement will reflect any payments taken by the Clients
                  under Clause 5.3.2, any sums owed by the Clients to LND
                  and any Remittances received by LND. LND will provide the
                  Clients with statements of each Receivables Purchased
                  Account and each Memorandum Discounting Statement which
                  shall, save for any manifest error, be valid and
                  binding upon the Clients in all respects.

      5.4   Facility Limit
            --------------

            If, at any time, the Sterling Funding Amount exceeds the
            Facility Limit the Clients shall forthwith pay the difference
            between such amounts to LND.

      5.5   Calculation of Available Amount
            -------------------------------

            The Available Amount in relation to an Approved Currency shall
            be an amount, without double counting, equal to the aggregate
            of:

            5.5.1 the face amount of all Purchased Receivables including
                  any VAT as has been previously notified on an Advice
                  Transmission to LND and standing to the credit of all
                  Receivables Purchased Accounts for that Approved
                  Currency;

            5.5.2 any monies received by LND from the Clients under this
                  Agreement; and

            5.5.3 any monies received by LND under Clause 5.9;

            LESS:

            5.5.4 first, without double counting, the aggregate of:-

                  5.5.4.1     all payments made to the Clients by LND under
                              this Agreement;

                  5.5.4.2     the amount of any Purchased Receivable in
                              excess of 120 days from date of original
                              invoice in relation to the relative Goods or
                              Services as determined by the latest aged
                              debts listing received by LND;

                  5.5.4.3     the amount of any Purchased Receivable
                              subject to any dispute by the Customer or in
                              relation to which legal proceedings for their
                              recovery have been threatened or instigated
                              by the Clients;

                  5.5.4.4     the amount of any accumulated retrospective
                              discount afforded by the Clients to any Customer;

                  5.5.4.5     the amount of any Purchased Receivable that
                              relates to Goods which are situated on
                              premises owned or occupied by the Clients;

                  5.5.4.6     the amount of any Purchased Receivable that
                              relates to goods or services which are not
                              assets of the relevant Client but which add
                              value to such of the Customers' Goods which are
                              in the custody of the Clients for the purpose of
                              providing such Goods or Services;

                  5.5.4.7     the amount of any Purchased Receivable in
                              relation to which the Clients do not have
                              available proof of Delivery, satisfactory to
                              LND, of the relative Goods or Services;

                  5.5.4.8     the amount of any Purchased Receivable in
                              relation to Goods supplied on a 'sale or return'
                              basis;

                  5.5.4.9     any Purchased Receivable in relation to which
                              the Customer has not obtained all the authorities
                              necessary under the regulations in force in the
                              country to which the Goods or Services are
                              provided or from which payment is to be made in
                              order to pay such Receivable in accordance with
                              the relative contract or invoice;

                  5.5.4.10    any Purchased Receivable which is not a bona
                              fide obligation of the Customer arising out
                              of the sale of Goods or the provision of
                              Services by the Clients in the ordinary
                              course of its trading;

                  5.5.4.11    in respect of a Substantial Receivable the
                              amount of any excess above the twenty five
                              per cent level required to categorise a
                              Receivable as a Substantial Receivable ;

                  5.5.4.12    the amount of any Purchased Receivable from
                              any Customer who is a supplier of Goods or
                              Services to the Clients;

                  5.5.4.13    the amount of all payments due and payable by
                              any Client under this Agreement (including
                              any payments under Clause 6.1);

                  5.5.4.14    the amount of the full value of all credit
                              notes issued by, or due from, any Client;

                  5.5.4.15    the amount of any Purchased Receivable which
                              LND gives notice to a Client to repurchase
                              under Clause 8.1;

                  5.5.4.16    the amount of any payment, costs, damage or
                              liability made or sustained by LND arising
                              directly or indirectly in consequence of any
                              breach of representation, warranty or undertaking
                              by the Clients or steps taken by LND to mitigate
                              such payment, cost or damage or liability;

                  5.5.4.17    the amount of any Substantial Debt Deduction;

                  5.5.4.18    the amount of any Purchased Receivable from
                              either a Customer incorporated outside any
                              country which is a member of the OECD or which
                              arose in relation to the provision of Goods or
                              Services outside of any country which is a member
                              of the OECD;

                  5.5.4.19    the amount of any Purchased Receivable in
                              relation to which there is a restriction on
                              the relative Client's ability to assign the
                              benefit of such Purchased Receivable;

                  5.5.4.20    the amount of any Purchased Receivable which
                              later becomes a Receivable falling within the
                              categories of Receivable defined in this
                              Agreement as "Unpurchased Receivables"; and

                  5.5.4.21    in respect of Purchased Receivables which are
                              not insured with a credit insurer reasonably
                              acceptable to LND, the amount of any excess above
                              the amount by which such Purchased Receivables
                              exceed 10% of the aggregate amount of Purchased
                              Receivables at any time

            in the case of all such lettered and numbered items, which are
            denominated in that Approved Currency; and

            5.5.5 Secondly, from the balance thereof, an amount equal to
                  the Global Deduction Percentage of such balance.

      5.6   Variation of Global Deduction Percentage
            ----------------------------------------

            5.6.1 The Global Deduction Percentage shall be varied to the
                  extent determined by LND if LND having complied with
                  Clauses 5.6.3 and 5.6.4, determines that:

                  5.6.1.1     the quality of covenant of the Customer base
                              taken as a whole has deteriorated or is likely
                              to do so;

                  5.6.1.2     the quality of covenant of any Client has
                              deteriorated or is likely to do so; and

                  5.6.1.3     the quality of the Purchased Receivables taken
                              as a whole has deteriorated or is likely to do
                              so.

            5.6.2 The amount of any variation of the Global Deduction
                  Percentage under this Clause shall reflect the extent of
                  the deteriorations referred to in Clause 5.6.1 above.

            5.6.3 LND shall give the Initial Client a minimum of one
                  months' written notice of the possibility of a variation
                  of the Global Deduction Percentage specifying the reason
                  for such possible variation.

            5.6.4 If the Initial Client, within 5 Business Days of receipt
                  of the notice from LND in Clause 5.6.3, gives written
                  notice to LND that it disagrees with the reasons
                  specified by LND in its notice, then LND and the Initial
                  Client shall consult with each other in good faith for a
                  period of not more than 10 days to determine whether, and
                  to the extent that, the Global Deduction Percentage shall
                  be varied. Any agreement in respect of such variation
                  between LND and the Initial Client shall be binding on
                  all the Clients. In the absence of agreement within such
                  10 day period the determination of LND under Clause 5.6.1
                  shall be binding on all the Clients and the Global
                  Deduction Percentage varied accordingly.

       5.6.5      If the Global Deduction Percentage is varied by
                  LND under this Clause 5.6 and the Initial Client
                  disagrees with the proposed variation (and
                  agreement cannot be reached pursuant to Clause
                  5.6.4 above) the Initial Client shall (on behalf
                  of the Clients) be entitled to repurchase all, but
                  not part, of the Purchased Receivables by giving
                  LND not less than 90 days prior written notice
                  (which shall be irrevocable). The Initial Clients
                  obligations under such notice will be to
                  repurchase the Purchased Receivables by payment to
                  LND of amounts in each Approved Currency equal to
                  the Funding Amounts on the date of payment for
                  each Approved Currency provided always that no
                  prepayment fee shall be payable to LND in such
                  circumstances. Any such payment will be subject to
                  Clause 20.1. On such repurchase the Invoice
                  Discounting Facility shall automatically be
                  cancelled and reduced to zero.

      5.7   Determination of Substantial Debt Deduction
            -------------------------------------------

            5.7.1 The Substantial Debt Deduction (if any) of the relative
                  Substantial Receivable shall be determined by LND in its
                  sole discretion if LND determines that:

                  5.7.1.1     the quality of covenant of the relative
                              Customer has deteriorated or is likely to do so;
                              or

                  5.7.1.2     the quality of the relative Substantial
                              Receivable has deteriorated or is likely to do
                              so.

            5.7.2 The determination of any Substantial Debt Deduction shall
                  be made and reviewed promptly after the end of each
                  calendar month.

            5.7.3 LND shall promptly notify the Initial Client in writing
                  of its determination under Clause 5.7.1 and shall (to the
                  extent permitted by law and not restricted by any
                  confidentiality obligation of LND to any third party)
                  give the reasons for its determination. If the Initial
                  Client disagrees with such reasons LND and the Initial
                  Client shall consult with each other in good faith for a
                  period of not less than 1 week. Any agreement in respect
                  of the determination of a Substantial Debt Deduction
                  between LND and the Initial Client shall be binding on
                  all the Clients. In the absence of agreement the
                  determination of the relative Substantial Debt Deduction
                  by LND shall be binding on all the Clients.

            5.7.4 The Substantial Debt Deduction shall come into effect 1
                  week after the Initial Client has received notification
                  of the determination thereof.

            5.7.5 The Substantial Debt Deduction may not be applied in
                  relation to any Substantial Receivable in relation to
                  which a Client has obtained credit insurance for the full
                  value thereof from a credit insurer reasonably acceptable
                  to LND in form and substance satisfactory to LND and
                  which are assigned (by way of security) to LND.

      5.8   Assignment of Purchased Receivables
            -----------------------------------

            5.8.1 Each Client shall at its own expense and if so requested
                  by LND execute a separate assignment in writing to LND of
                  any Purchased Receivable sold to LND in accordance with
                  this Agreement and of any rights which that Client may
                  have in relation thereto. LND shall be entitled to serve
                  notice of such assignment at any time in its absolute
                  discretion.

            5.8.2 If in relation to any Purchased Receivable it is not
                  possible for LND to take a separate assignment the
                  relevant Client will hold such Purchased Receivable in
                  trust for LND and any payments received in respect
                  thereof will be immediately paid to LND.

      5.9   Goods
            -----

            5.9.1 On purchase by LND of any Purchased Receivable any title,
                  property, right or interest of the relevant Client in the
                  Goods to which such Purchased Receivables relates
                  (including all such Goods that may be rejected or
                  returned by the Customers) all the relevant Client's
                  rights as unpaid vendor and all other rights of the
                  relevant Client under the contract or contracts pursuant
                  to which the Purchased Receivable comes into existence
                  (whether such rights be created by contract, statute or
                  other rule of law) shall be deemed to be assigned and
                  transferred to LND absolutely whether or not the Goods
                  shall have been Delivered by the relevant Client at the
                  time of the said purchase.

            5.9.2 On purchase by LND of any Purchased Receivable there
                  shall vest in LND the benefit of all guarantees,
                  indemnities, insurances and securities given to or held
                  by the relevant Client in respect of such Purchased
                  Receivables or of the relative Goods or Services.

            5.9.3 Any Goods relating to any Purchased Receivable recovered
                  by or on behalf of a Client shall be set aside marked
                  with LND's name and held for LND's account as owner.
                  Subject to the occurrence of a Default or Potential
                  Default which is continuing LND shall (in addition to and
                  without prejudice to any other rights it may have) have
                  the right to take possession of and to sell or cause to
                  be sold without notice any such returned or recovered
                  Goods at such prices to such purchasers and upon such
                  terms and conditions as it may in its absolute discretion
                  determine. Upon any such sale the relevant Client shall
                  pay to LND on demand (and without asserting any right of
                  set-off or counterclaim deduction or withholding):

                  5.9.3.1     the difference between the amount of the
                              Purchased Receivable relating to such Goods
                              and the amount received by LND on any such
                              sales; and

                  5.9.3.2     any costs and expenses (including legal fees)
                              incurred by LND in relation to any such
                              repossession and sale.

            5.9.4 Each Client (as trustee for LND) will hold and keep
                  separate from any other monies of that Client all
                  Remittances received by it in payment of any Purchased
                  Receivable which has been sold to LND. Each Client will
                  immediately pay all such Remittances endorsed where
                  required:-

                  5.9.4.1     direct to the account of LND at the bankers of
                              LND; or

                  5.9.4.2     into a trust account in the name of LND.

      5.10  Collection
            ----------

            5.10.1  Prior to LND making a direction under Clause 12.2.12 the
                    Initial Client will be responsible (at its own expense)
                    for collection of all Receivables and for the management
                    of all Customers accounts on LND's behalf as an
                    undisclosed agent. During this period, LND may
                    communicate in the Initial Client's name with Customers
                    for the purposes of verifying the existence and amount of
                    Receivables. The Initial Client undertakes to
                    LND that it will act promptly and efficiently when
                    carrying out its duties as LND's agent.

            5.10.2  Upon the making of a direction by LND under Clause
                    12.2.12, LND shall have the sole right of collecting and
                    enforcing payment of the Purchased Receivables (other
                    than those re-assigned after payment of the repurchase
                    price) in whatever manner it may in its absolute
                    discretion decide, whether or not the relevant Client has
                    been debited with the amount of the Purchased Receivables
                    and each Client shall co-operate to procure such
                    collection and enforcement.

            5.10.3  Upon LND giving notice to the Initial Client, the conduct
                    of any proceedings shall be with LND who may (where
                    necessary in the name of any Client) institute,
                    compromise, settle, abandon or in any manner whatsoever
                    conduct such proceedings upon such terms as LND in its
                    sole discretion shall decide and each Client shall be
                    bound by all acts of LND under this Clause 5.10. The
                    Client shall be responsible for and shall forthwith on
                    demand pay all reasonable costs, charges and expenses of
                    whatsoever nature incurred by LND under this Clause 5.10.

            5.10.4  Each Client irrevocably:
                    -----------------------

                  5.10.4.1    authorises LND to endorse the name of that
                              Client on any and all cheques or other forms of
                              Remittance received where such endorsement is
                              required to effect collection or to perfect LND's
                              title as a holder in due course of the Purchased
                              Receivables; and

                  5.10.4.2    following a Default or Potential Default
                              which is continuing appoints LND the attorney
                              of that Client to execute in the name and on
                              behalf of that Client any assignment
                              requested under Clause 5.8.1

            The power of attorney granted by this Clause 5.10.4 is granted
            irrevocably and for value as part of LND's rights under this
            Agreement to secure proprietary interests in and the
            performance of the Client's obligations owed to LND within the
            meaning of the Powers of Attorney Act 1971.

6.    REMUNERATION
      ------------

      6.1   Determination of the Funding Amount
            -----------------------------------

            The Funding Amount, in relation to an Approved Currency, shall
            be an amount equal to the aggregate of (without double
            counting):-

            6.1.1 all amounts paid to the Clients by LND under this Agreement;

            6.1.2 the aggregate of all of the amounts due and payable by the
                  Clients to LND under this Agreement; and

            6.1.3 the aggregate of all of the amounts paid by LND directly
                  or indirectly in consequence of any breach of this
                  Agreement by the Clients;

            LESS (without double counting):

            6.1.4 any amount received by LND under this Agreement;

            6.1.5 any amount received by LND directly from a Customer in
                  relation to any Purchased Receivable; and

            6.1.6 any amount paid by the Clients to LND,

            in each case, where amounts paid or received are amounts
            denominated in that Approved Currency.

      6.2   Discounting Charge
            ------------------

            The Initial Client shall be obliged to pay a Discounting Charge
            calculated in accordance with Clause 6.3 below on the Funding
            Amount from time to time at the rate determined by LND to be
            the Discounting Rate.

      6.3   Calculation and Payment of Remuneration
            ---------------------------------------

            6.3.1 As soon as is practicable following each Remuneration
                  Payment Date, LND will notify the Client of the relative
                  rate and amount of the Discounting Charge or other amount
                  payable by the Client for the relative month.

            6.3.2 Any Discounting Charge and default interest due from the
                  Client to LND under any of the Discounting Documents
                  shall:-

                  6.3.2.1     accrue from day to day on the relative
                              amount, be calculated on the basis of the
                              actual number of days elapsed and a 365 day
                              year (or 360 days if the Funding Amount is
                              denominated in United States Dollars or
                              Euros);

                  6.3.2.2     be paid in the currency of the relative
                              Funding Amount by the Client to LND in
                              arrears on each Remuneration Payment Date;
                              and

                  6.3.2.3     be payable after as well as before judgement.

      6.4   Margin Ratchet
            --------------

            6.4.1 In respect of each Financial Year of the Initial Client
                  beginning after 1/1/2000, the Margin shall reduce or
                  increase in accordance with the other provisions of this
                  Clause 6.4, provided that the Margin shall at no time be
                  greater than 2.25% per annum or less than 2% per annum.

            6.4.2 In this Clause 6.4 "Relevant Financial Year" means in
                  relation to a Financial Year of the Initial Client, the
                  immediately preceding Financial Year of the Initial
                  Client.

            6.4.3 Subject to the other provisions of this Clause 6.4 in
                  respect of a Financial Year of the Initial Client, the
                  margin shall be 2% per annum if the amount of PBIT for
                  the Relevant Financial Year is at least equal to or more
                  than (pound)5,000,000.

            6.4.4 In relation to a Financial Year of the Initial Client,
                  for the purpose of this Clause 6.4, any reduction or
                  increase in the Margin shall be determined on the day
                  immediately following receipt by the LND of the Accounts
                  for the Relevant Financial Year. Any reduction or
                  increase shall, subject to Clause 6.4.5, take effect
                  following receipt by LND of those Accounts as if it had
                  applied since the end of the Relevant Financial Year and
                  LND or the Client (as the case may be) will account to
                  the other accordingly. If the Initial Client does not
                  deliver the relevant Accounts to LND in accordance with
                  the terms of Clause 12.1.1, the Margin shall (if
                  necessary), as from the date immediately following the
                  last date on which such Accounts have been so delivered
                  to LND pursuant to Clause 12.1.1 until the date once such
                  Accounts have been so delivered, be reinstated to 2.25%
                  per annum.

            6.4.5 Where in respect of a Financial Year of the Initial
                  Client, the Margin has been adjusted on the basis of the
                  Accounts for the Relevant Financial Year and any
                  subsequent Accounts show that such adjustment should not
                  have been made, the said adjustment shall be cancelled on
                  the next Remuneration Payment Date to occur after
                  delivery of those subsequent Accounts to the LND and the
                  Client and LND shall promptly make such payments as may
                  be necessary to put themselves in the position they would
                  have been had no such adjustment been made.

            6.4.6 Notwithstanding any other term of this Clause 6.4, if, at
                  the time a decrease in the Margin is to take effect, a
                  Default or Potential Default is continuing, such decrease
                  shall not take effect unless and until such Default or
                  Potential Default ceases to be continuing or is waived.

            6.4.7 For the avoidance of doubt, if in respect of a Financial
                  Year of the Initial Client, the condition set out in
                  Clause 6.4.3 is not satisfied in relation to the Relevant
                  Financial Year, the Margin for that Financial Year shall
                  be 2.25% per annum.

      6.5   Default Interest
            ----------------

            If any Client fails to pay any amount due and payable to LND
            under any of the Discounting Documents on the due date, the
            Clients shall pay default interest on such amount to LND from
            the due date of actual payment at the rate per annum being the
            aggregate of:

            (a)   3% per annum; and

            (b)   the Discounting Rate.

      6.6   Expenses
            --------

            Each Client shall pay to LND all costs incurred (including VAT)
            in relation to the transmission of funds by LND to the clients.

      6.7   Records
            -------

            6.7.1 Upon a Client's request and subject to its compatibility
                  with LND's software LND shall provide to that Client
                  detailed records of the Available Amount, the Funding
                  Amounts and the Sterling Funding Amounts by means of a
                  modem communications link.

            6.7.2 At the end of each calendar month upon the request and at
                  the cost of the Clients LND shall provide hard copies of
                  any information specified under Clause 6.7.1.

      6.8   LND's Determination
            -------------------

            LND's determination of the amount of any of the Discounting
            Charge and default interest payable under any Clause 6 shall be
            conclusive and binding on the Clients
            except for any manifest error.

7.    TERMINATION, REPURCHASE AND CANCELLATION
      ----------------------------------------

      7.1   Repurchase
            ----------

            The Clients shall repurchase the Purchased Receivables by payment
            to LND on the Termination Date (or such later date as is agreed
            in writing between the Initial Client (on behalf of the Clients)
            and LND) of amounts in each Approved Currency equal to the
            Funding Amounts on that date for each Approved Currency.

      7.2   Voluntary repurchase of Receivables
            -----------------------------------

            7.2.1 The Clients may, by giving LND not less than 12 months
                  prior written notice, repurchase all the Purchased
                  Receivables on a Remuneration Payment Date by payment to
                  LND on that date of amounts in each Approved Currency
                  equal to the Funding Amounts on that date for each
                  Approved Currency. Such 12 months notice shall not be
                  required in the case of a repurchase of Receivables under
                  Clause 5.6.5 (Variation of Global Reduction Percentage),
                  Clause 7.4 (Repurchased Fees), Clause 8.1.2.2
                  (Illegality) or Clause 9.8.5 (Grossing Up) or Clauses
                  19.3.3 (Assignments) or 19.4.3 (Transfers) where the time
                  periods set out in such clauses shall apply or where
                  there is a general refinancing as defined in Clause 7.4
                  below where 90 days prior written notice (which shall be
                  irrevocable) of such refinancing by the Client shall be
                  required.

            7.2.2 Any notice of repurchase shall be irrevocable, shall
                  specify the date on which the repurchase or the
                  prepayment is to be made and shall oblige the Clients to
                  make that repurchase.

      7.3   Cancellation of Invoice Discounting Facility
            --------------------------------------------

            7.3.1 The Initial Client (on behalf of the Clients) may by no
                  less than 5 Business Days' prior irrevocable written
                  notice to LND, cancel any undrawn part of the Invoice
                  Discounting Facility (in minimum amounts of
                  (pound)1,000,000 and subsequent multiples of
                  (pound)1,000,000). The Facility Limit will be reduced
                  accordingly.

            7.3.2 The Client may not cancel all or part of the Invoice
                  Discounting Facility if such cancellation would result in
                  the Sterling Funding Amount exceeding the Facility Limit.

      7.4   Repurchase Fees
            ---------------

            If on or before the expiry of the 24 month period from the
            Commencement Date the Funding Amount (or any part thereof) are
            repaid from the proceeds of a refinancing with persons other
            than LND or the Facility Limit is cancelled as a consequence of
            a refinancing with persons other than LND the Initial Client
            shall at the same time pay to LND a prepayment fee equal to 1.5
            per cent of the aggregate amount of the Funding Amount prepaid
            or the Facility Limit cancelled provided always that no
            prepayment fee shall be payable to LND if (a) such refinancing
            forms part of a general refinancing (a "general refinancing")
            of the debt obligations of the group of companies of which the
            Holding Company is parent (but only as long as such
            refinancing does not involve directly or indirectly the
            Invoice Discounting Facility being refinanced or provided by
            another invoice discounter or specialist debt purchase
            financer based in the United Kingdom), (b) repayment is made
            as a result of the provisions of Clause 8 (Illegality),
            Clause 9.8 (Grossing Up), Clause 5.6.5 (Variation of Global
            Deduction Percentage) or Clauses 19.3.3 (Assignment) or
            19.4.3 (Transfers).

8.    CHANGES IN CIRCUMSTANCES
      ------------------------

      8.1   Illegality
            ----------

            If after the date of this Agreement it is or becomes illegal
            for LND to maintain or to continue to make available or fund
            all or any part of the Facility

            then:-

            8.1.1 LND shall notify the Initial Client; and

                  8.1.1.1     the obligations of LND under this Agreement
                              shall be cancelled immediately; and

                  8.1.1.2     the Clients shall repurchase the Purchased
                              Receivables by payment of amounts equal to the
                              Funding Amount for each Approved Currency
                              (together with all other amounts owing
                              to LND under this Agreement) within 5 Business
                              Days of demand by LND (or, if permitted by the
                              relevant law, on the next Remuneration Payment
                              Date).
      8.2   Certificates
            ------------

            The certificate or notification of LND as to any of the matters
            referred to in Clause 8.1 shall be conclusive and binding on
            the Clients except for any manifest error.

9.    PAYMENTS
      --------

      9.1   Place and Time
            --------------

            All payments to be made by a Client in relation to this
            Agreement shall be made to LND at its office at Feltham or such
            other office at such time as LND may notify the Clients for
            this purpose.

      9.2   Funds
            -----

            All payments to LND under this Agreement shall be made for
            value on the due date in freely transferable and readily
            available funds.

      9.3   Business Days
            -------------

            If a payment under this Agreement is due on a day which is not
            a Business Day, the due date for that payment shall instead be
            the next Business Day in the same calendar month (if there is
            one) or the preceding Business Day (if there is not).

      9.4   Currency
            --------

            All payments by a Client is respect of a Funding Amount shall
            be made in the relative Approved Currency. All payments
            relating to costs, losses, expenses or Taxes shall, be made in
            the currency in which the relative costs, losses, expenses or
            Taxes were incurred. Any other amount payable under this
            Agreement shall, except as otherwise provided, be made in
            Sterling.

      9.5   Accounts as evidence
            --------------------

            LND shall maintain in accordance with its usual practice the
            Receivables Purchased Account and the Memorandum Discounting
            Statement which shall, as between the Clients and LND, be prima
            facie evidence of the amounts from time to time paid by, owing
            to, and paid to, LND under this Agreement.

      9.6   Partial Payments
            ----------------

            9.6.1 If LND receives a payment insufficient to discharge all
                  the amounts due and payable by a Client under this
                  Agreement, LND shall apply that payment towards the
                  obligations of that Client in the following order:

                  9.6.1.1     first, in or towards payment of any unpaid
                              costs and expenses of LND under this Agreement;

                  9.6.1.2     second, in or towards payment pro rata of any
                              accrued Discounting Charge due by that Client
                              but unpaid under this Agreement;

                  9.6.1.3     third, in or towards payment pro rata of any
                              other sum due by that Client but unpaid under
                              the Discounting Documents.

            9.6.2 LND may vary the order set out in Clause 9.6.1.1 to
                  9.6.1.3 and shall give notice to the Initial Client of
                  any such variation.

            9.6.3 Clause 9.6.1 shall override any appropriation made by any
                  Client.

      9.7   Set-Off and Counterclaim
            ------------------------

            All payments by any Client under this Agreement shall be made
            without set-off, deduction or counterclaim.

      9.8   Grossing-Up
            -----------

            9.8.1 Subject to Clause 9.8.2, all sums payable to LND pursuant
                  to or in connection with any Discounting Document shall
                  be paid in full free and clear or all deductions or
                  withholdings whatsoever except only as may be required by
                  law.

            9.8.2 If any deduction or withholding is required by law in
                  respect of any payment due from a Client or a Customer to
                  LND pursuant to or in connection with any Discounting
                  Document each Client shall:

                  9.8.2.1     ensure or procure that the deduction or
                              withholding is made and that it does not
                              exceed the minimum legal requirement
                              therefor;

                  9.8.2.2     pay, or procure the payment of, the full
                              amount deducted or withheld to the relevant
                              Taxation or other authority in accordance
                              with the applicable law;

                  9.8.2.3     increase the payment in respect of which the
                              deduction or withholding is required so that the
                              net amount received by LND after the deduction or
                              withholding (and after taking account of any
                              further deduction which is required to be made as
                              a consequence of the increase) shall be equal to
                              the amount which LND would have been entitled to
                              receive in the absence of any requirement to make
                              any deduction or withholding; and

                  9.8.2.4     promptly deliver or procure the delivery to
                              LND of receipts evidencing each deduction or
                              withholding which has been made.

            9.8.3 If LND determines, in its absolute discretion, that it
                  has received, realised, utilised and retained a Tax
                  benefit by reason of any deduction or withholding in
                  respect of which a Client has made an increased payment
                  under this Clause 9.8 LND shall, provided that it has
                  received all amounts which are then due and payable under
                  any Discounting Document, pay to that Client (to the
                  extent that LND can do so without prejudicing the amount
                  of the benefit or repayment and the right of LND to
                  obtain any other benefit, relief or allowance which may
                  be available to it) such amount, if any, as LND, in its
                  absolute discretion shall determine, will leave LND in no
                  worse position than it would have been if the deduction
                  or withholding had not been required, provided that:

                  9.8.3.1     LND shall have an absolute discretion as to
                              time at which and the order and manner in
                              which it realises or utilises any Tax benefit
                              and shall not be obliged to arrange its
                              business or its Tax affairs in any particular
                              way in order to be eligible for any credit or
                              refund or similar benefit;

                  9.8.3.2     LND shall not be obliged to disclose any
                              information regarding its business, Tax affairs
                              or its Tax computations; and

                  9.8.3.3     if LND had made a payment to a Client pursuant
                              to this Clause 9.8.3 on account of any Tax
                              benefit and it subsequently transpires
                              that LND did not receive that Tax benefit, or
                              received a lesser Tax benefit, that Client shall
                              on demand pay to LND such sum as LND may
                              determine as being necessary to restore its
                              after-tax position to that which it would have
                              been had no adjustment under this Clause 9.8.3
                              been made; and

                  9.8.3.4     any sums payable by a Client to LND under
                              this Clause 9.8.3 shall be subject to Clause
                              15.6.

            9.8.4 LND shall not be obliged to make any payment under Clause
                  9.8.3 if, by doing so, it would contravene the terms of
                  any applicable law or any notice, direction or
                  requirement of any governmental or regulatory authority
                  (whether or not having the force of law).

            9.8.5 If a Client is required to make an increased payment for
                  the account of LND under Clause 9.8.2, then, without
                  prejudice to that obligation and so long as such
                  requirement exists and subject to the Initial Client (on
                  behalf of the Clients) giving LND not less than 10 days'
                  prior written notice (which shall be irrevocable), the
                  Clients may repurchase all, but not part, of the
                  Purchased Receivables by payment to LND of amounts in
                  each Approved Currency equal to the Funding Amounts on
                  the date of payment for each Approved Currency and
                  without payment of any prepayment fee. Any such payment
                  shall be subject to Clause 20.1. On any such repurchase
                  the Invoice Discounting Facility shall be automatically
                  cancelled.

10.  SECURITY
     --------

     10.1   Security Documents
            ------------------

            The obligations and liabilities of the Clients to LND under the
            Discounting Documents shall be secured by the interests and
            rights granted in favour of LND
            under the Security Documents.

11.   REPRESENTATIONS AND WARRANTIES
      ------------------------------

      11.1  Representations and warranties

            The Initial Client represents and warrants to LND that:

            11.1.1  STATUS: each Client is a limited company duly incorporated
                    under the laws of England and Wales and it possesses the
                    capacity to sue and be sued in its own name and has the
                    power to carry on its business and to own its property and
                    other assets;

            11.1.2  POWER AND AUTHORITY: each Group Company has (or had,
                    as the case may be) power to execute, deliver and
                    perform its obligations under the Transaction Documents
                    and to carry out the transactions contemplated by those
                    documents and all necessary corporate, shareholder and
                    other action has been or will be taken to authorise the
                    execution, delivery and performance of the same. In
                    particular no Client has any express limitation on its
                    power or capability to sell Receivables to any third
                    party or any utilisation of the Invoice Discounting
                    Facility;

            11.1.3  BINDING OBLIGATIONS: the obligations of each Group
                    Company under the Transaction Documents constitute its
                    legal, valid, binding and enforceable obligations;

            11.1.4  CONTRAVENTIONS: the execution, delivery and
                    performance by each Group Company of the Transaction
                    Documents does not:

                  11.1.4.1    contravene any applicable law or regulation
                              or any order of any governmental or other
                              official authority, body or agency or any
                              judgment, order or decree of any court having
                              jurisdiction over it;

                  11.1.4.2    conflict with, or result in any breach of any
                              of the terms of, or constitute a default under,
                              any agreement or other material instrument to
                              which it is a party or any licence or other
                              authorisation to which it is subject or by which
                              it or any of its property is bound; or

                  11.1.4.3    contravene or conflict with the provisions of
                              its memorandum and articles of association;

            11.1.5  INSOLVENCY: no Group Company has taken any action nor
                    have any steps been taken or legal proceedings been
                    started or threatened against it for winding-up,
                    dissolution or re-organisation, the enforcement of any
                    Security Interest over its assets or for the appointment
                    of a receiver, administrative receiver, or administrator,
                    trustee or similar officer of it or of any of its assets;

            11.1.6  NO DEFAULT: no Group Company is (nor would be with any of
                    the giving of notice, the lapse of time, the
                    determination of materiality, or the satisfaction of any
                    other condition) in breach of or in default under any
                    material agreement to which it is a party or which is
                    binding on it or any of its assets;

            11.1.7  LITIGATION: no action, litigation, arbitration or
                    administrative proceeding has been commenced, or is
                    pending or threatened, against any Group Company which,
                    if decided adversely, could be expected to have a
                    material adverse effect on the relevant company's
                    business assets or financial condition or its ability to
                    comply with any obligation under the Discounting
                    Documents nor is there subsisting any unsatisfied
                    judgment or award given against any of them by any court,
                    arbitrator or other body;

            11.1.8  ACCOUNTS: each of the latest Accounts of each Material
                    Company required to be delivered under Clause 12.1.1 is
                    prepared in accordance with GAAP and gives a true and
                    fair view of the financial position of the relevant
                    company as at the date to which they were prepared and
                    for the Financial Year of that company then ended and
                    that as at such date, such Material Company did not have
                    any significant liabilities (contingent or otherwise)
                    which are required to be disclosed or reserved in
                    accordance with GAAP and are not disclosed by or reserved
                    against in, such financial statements (or the notes
                    thereto) and such Material Company did not have any
                    unrealised or anticipated losses which should, in
                    accordance with GAAP be included in such Accounts by way
                    of note or provision;

            11.1.9  MANAGEMENT ACCOUNTS, any Management Accounts required to
                    be delivered under Clause 12.1.2 have been properly
                    prepared in accordance with good accounting practice on a
                    basis consistent with that adopted in the Accounts, that
                    such Management Accounts are not considered misleading in
                    any material respects, that the profit and loss accounts
                    contained in the Management Accounts give a fair view of
                    the results of the Client for the trading period to which
                    they relate and the statement of net trading assets
                    contained in the Management Accounts gives a fair view of
                    the financial position of the business of the Client on
                    that date;

            11.1.10 SECURITY INTEREST: no Security Interest (other than a
                    Permitted Security Interest) exists over all or any part of
                    the assets of any Group Company;

            11.1.11 NO SECURITY INTEREST CREATED: the execution of the
                    Discounting Documents by the Group Companies (and the
                    Holding Company, as the case may be) and the exercise
                    of each of their respective rights and the performance
                    of each of their respective obligations under the
                    Discounting Documents will not result in the creation
                    of, or any obligation to create, any Security Interest over
                    or in respect of any of their assets except a Permitted
                    Security Interest;

            11.1.12 AUTHORISATIONS: all authorisations, approvals,
                    licences, consents, filings, registrations, payment of
                    duties or taxes and notarisations required:

                  11.1.12.1   for the conduct of the business, trade and
                              ordinary activities of each Group Company;

                  11.1.12.2   for the performance and discharge of the
                              obligations of each Group Company and the
                              Holding Company under the Discounting
                              Documents to which it is a party; and

                  11.1.12.3   in connection with the execution, delivery,
                              validity, enforceability or admissibility in
                              evidence of the Discounting Documents

                  are in full force and effect;

            11.1.13      TAXES: no claims are being or are likely to be
                         asserted against the Initial Client with respect
                         to Taxes which are likely to be determined
                         adversely to the Initial Client and which, if so
                         adversely determined, would cause a Material
                         Adverse Change, and that it is not overdue in the
                         filing of any Tax returns;

            11.1.14      CORPORATE STRUCTURE: immediately prior to
                         Completion, the Client has and has had no
                         Subsidiaries;

            11.1.15      ENVIRONMENTAL: save as fully and fairly
                         disclosed to NWB in writing and contained in the
                         Fifth Schedule of the NWB Agreement the Initial
                         Client:-

                   11.1.15.1  complies and has at all times complied in all
                              material respects with all Environmental Laws and
                              Environmental Consents which may cause a Material
                              Adverse Change except where any breach is a
                              matter the subject of indemnification in favour
                              of the Initial Client under the Acquisition
                              Agreement and the Initial Client has taken all
                              steps to enforce such rights of indemnification;

                    11.1.15.2 has obtained and maintained in full force and
                              effect all material Environmental Consents and,
                              there are no conditions, facts or circumstances
                              entitling any such material Environmental
                              Consents to be revoked, suspended, amended,
                              varied, withdrawn or not renewed or which would
                              prevent compliance with any Environmental
                              Consents;

                    11.1.15.3 is not required by any Environmental Consent
                              or any Environmental Law or as a result of any
                              claim in respect of a breach of any Environmental
                              Law or Consent to make any investment or to incur
                              any expenditure or to take or desist from taking
                              any action which is likely to have a material
                              adverse effect on its financial condition;

            11.1.16      ENVIRONMENTAL BREACHES: no claim in respect of
                         a breach of any Environmental Law or Consent is
                         pending or has been made or threatened against the
                         Initial Client or any occupier of any property
                         owned or leased by the Clients;

            11.1.17      DELIVERY AND SERVICE: in relation to each
                         Purchased Receivable, the Goods have been duly
                         Delivered or the Services duly provided;

            11.1.18      BONA FIDE OBLIGATIONS: each Purchased Receivable is
                         an existing and bona fide obligation of the
                         Customer arising out of the sale of Goods or the
                         provision of Services by a Client in the ordinary
                         course of its trading;

            11.1.19      ENFORCEABILITY: no Client is in breach of any
                         of its obligations to any Customer and the
                         Customer will accept the Goods or the Services and
                         the invoices therefor (or if the Customer is
                         bankrupt or in liquidation the Customer's trustee
                         in bankruptcy or liquidation will accept as proof
                         of debt for the unpaid balance of the invoiced
                         price) without any dispute or claim whatsoever
                         (whether justifiable or not) including disputes as
                         to price, terms, quantity, or quality, set-offs or
                         counter-claim or claims of release from liability
                         or inability to pay because of any act of God or
                         public enemy of war or because of the requirement
                         of law (whether in the United Kingdom or
                         elsewhere) or of rules, orders or regulations
                         having the force of law where any of the foregoing
                         would involve or result in a liability owing by
                         any Client in excess of(pound)100,000 at any time;

            11.1.20      CUSTOMERS AUTHORITIES: to the best of the
                         knowledge, information and belief of the Initial
                         Client each Customer has obtained all the
                         authorities necessary under the regulation in
                         force in the country to which the Goods or
                         Services are provided or from which payment is to
                         be made, in order to pay the Receivables in
                         accordance with the contract or invoice;

            11.1.21      CUSTOMER CONTRACTS: the standard terms of
                         trading with Customers provide that they are
                         governed by English law and specifies the nature
                         and quantity of the Goods or Services and every
                         invoice relating to such contracts contains the
                         terms and currency of payment and the benefit of
                         material contracts entered into between the
                         Clients and any of their Customers in respect of
                         Purchased Receivables is capable of formal
                         assignment in favour of LND and "material" for the
                         purposes of this Clause 11.2.21 shall mean
                         contracts with an aggregate rate in excess of 5%
                         of turnover of the relevant Client;

            11.1.22      NO MATERIAL ADVERSE CHANGE: no Material Adverse
                         Change has occurred;

            11.1.23      US LOCKBOX ACCOUNT: no Security Interest (other
                         than a Permitted Security Interest) or rights of
                         set off or combination of accounts exists in
                         favour of any person in respect of the Initial
                         Client's interest in the US Lockbox Account and
                         any monies standing to the credit of such account;
                         and

            11.1.24      RETENTION OF TITLE: none of the contracts or
                         trading terms between any of the Clients and its
                         suppliers create any retention of title provisions
                         whereby the relevant suppliers are entitled
                         validly to the proceeds of sale of any Goods
                         supplied (or any products in which the Goods have
                         been mixed).

      11.2  Repetition
            ----------

            The representations and warranties set out in Clause 11.1 shall
            survive the execution of this Agreement and shall be deemed to
            be repeated on the Commencement Date and each of the said
            representations and warranties shall be repeated on each
            Quarter Date, in each case, as if made with reference to the
            facts existing at the time of repetition.

      11.3  LND Warranty
            ------------

            LND warrants that the date of this Agreement it is authorised
            to purchase Receivables under the terms of this Agreement.

12.   UNDERTAKINGS
      ------------

      12.1  Information undertakings
            ------------------------

            The Initial Client undertakes that during the Security Period
            it shall, unless LND otherwise agrees:

            12.1.1  ACCOUNTS: as soon as the same become available (and in
                    any event within 120 days after the end of its Financial
                    Years), deliver to LND a copy of the Accounts for each
                    such Financial Year of each Material Company together
                    with:

                  12.1.1.1    the notes thereto and directors report thereon;

                  12.1.1.2    a copy of the management letter (if any)
                              addressed by the Auditors to the directors of
                              each such company in connection with its auditing
                              of the relevant Accounts as soon as practicable
                              after receipt of the letter by such company; and

                  12.1.1.3    a copy of Form 10-Q and 10-K (with all
                              attachments) filed by the Holding Company
                              with the Securities and Exchange Commission
                              in the United States of America;

            12.1.2  MANAGEMENT ACCOUNTS: as soon as the same become available
                    (and in any event within 30 days after the end of each
                    successive accounting period (none of which shall be more
                    than 5 weeks in duration) (each an "Accounting Period")
                    during each of its Financial Years, deliver to LND a copy
                    of the management accounts (the "Management Accounts") of
                    the Client (in which case such management accounts shall
                    be consolidated management accounts relating to the
                    Group) and of each other Material Company for each such
                    Accounting Period and in such a form as to disclose the
                    financial position of the Client or, as the case may be,
                    the relevant Material Company and which shall include the
                    following information in respect of each such Accounting
                    Period:

                  12.1.2.1    a statement of profit and loss;

                  12.1.2.2    a balance sheet; and

                  12.1.2.3    a cashflow statement;

            12.1.3  BUDGETS: no later than 30 days prior to the beginning of
                    each Financial Year a budget for such Financial Year in a
                    form previously approved by LND (without prejudice to any
                    other provision of this Clause 12 and including
                    specifically, but without limitation, profit and loss and
                    cashflow forecasts and balance sheet for such Financial
                    Year) and a certificate signed by a director of the
                    Initial Client (without personal liability on his part,
                    except in the case of fraudulent misrepresentation) to
                    the effect that implementation of such budget would not
                    give rise to:-

                  12.1.3.1    a Default; or

                  12.1.3.2    a Potential Default,

                  at any time during or following such Financial Year;

            12.1.4  INFORMATION ON REQUEST: subject to LND complying with any
                    specific confidentiality provisions given in favour of
                    Customers will provide to LND such financial and other
                    information (other than customer trade secrets) in its
                    possession concerning the Clients or any of their
                    Customers as LND may from time to time reasonably
                    require;

            12.1.5  CASHFLOW FORECASTS: provide to LND within 30 days of each
                    Quarter Date cashflow forecasts in respect of each
                    Material Company relating to the 6 month period
                    commencing on each such Quarter Date;

            12.1.6  COMPLIANCE CERTIFICATES : at the time of the delivery
                    of the Accounts for each Financial Year, and at the
                    time of delivery of the Management Accounts on each
                    Quarter Date, a certificate in the form of Schedule 5
                    signed by a director of the Initial Client (without
                    personal liability on his part, except in the case of
                    fraudulent misrepresentation), stating :-

                    12.1.6.1  the respective amounts of PBIT, Interest,
                              Adjusted Tangible Net Worth, Current Assets,
                              Current Liabilities and Capital Expenditure
                              (such certificate to be prepared in each case in
                              respect of or, as the case may be, as at the end
                              of the Financial Year or at the Quarter Date to
                              which such Accounts or Management Accounts
                              respectively relate and to indicate the manner
                              in which such amounts have been calculated);

                    12.1.6.2  the application of such amounts to the ratios
                              and limits specified in Clause 12.4 and
                              confirming that, as at the date at or to which
                              the relevant Accounts or, as the case may be,
                              Management Accounts are made up, the Initial
                              Client was in compliance with the covenants and
                              undertakings set out in Clause 12.4 (or, if it
                              was not in such compliance, indicating the extent
                              of the breach and the steps intended to be taken
                              to remedy the same) and that, as at a date not
                              more than 7 days prior to the delivery of the
                              certificate:-

                        12.1.6.2.1  no Default has occurred and is continuing
                                    (or, if such is not the case, specifying
                                    the same); and

                        12.1.6.2.2  the Initial Client is not aware that any
                                    PotentialDefault has occurred and is
                                    continuing;

                    12.1.6.3  that there has been no Material Adverse Change
                              in the business, assets or financial conditions
                              of the Clients since the date as at, or to which,
                              such Accounts or, as the case may be, Management
                              Accounts are made up (or, if such is not the
                              case, specifying the same);

                    12.1.6.4  that the representations and warranties
                              contained in Clause 11.1 were true (other than
                              previously advised in writing to LND) as at the
                              date of or to which such Accounts or, as the case
                              may be, Management Accounts are made up as if
                              made with reference to the facts and
                              circumstances existing at such dates;

            12.1.7  GAAP: ensure that all Accounts and other financial
                    information (to the extent practicable) submitted to LND
                    have been prepared in accordance with GAAP;

            12.1.8  DEFAULT, LITIGATION, ETC.: promptly, upon becoming aware of
                    the same, notify LND of:

                  12.1.8.1    any Default or Potential Default;

                  12.1.8.2    will, upon the same being threatened or
                              pending and in any case immediately after the
                              commencement thereof, give to LND notice in
                              writing of any litigation, arbitration or
                              administrative proceedings or any dispute
                              affecting the Initial Client or any of its
                              Subsidiaries or any of their respective assets,
                              rights or revenues in an amount in excess
                              of(pound)100,000 which if determined against such
                              company could be expected to have an adverse
                              effect on the ability of any Group Company duly
                              to perform and observe their respective
                              obligations under this Agreement or any of the
                              other Discounting Documents;

                  12.1.8.3    Any such notice under this Clause 12.1.8 shall
                              be accompanied by a statement of a duly
                              authorised officer of the Initial Client (without
                              personal liability on his part, except in the
                              case of fraudulent misrepresentation) providing
                              such notice, setting forth details of the
                              occurrence referred to and stating what action
                              the Initial Client proposes to take with respect
                              thereto.

                  12.1.8.4    any Security Interest (other than a Permitted
                              Security Interest) attaching to any of the
                              assets of any Group Company;

                  12.1.8.5    any occurrence relating to any Group Company
                              (including any third party claim or
                              liability) which could be expected to have a
                              Material Adverse Change;

            12.1.9  RECEIVABLES: within 15 days after the end of each
                    Accounting Period and in relation to each Approved Currency
                    provide to LND:

                   12.1.9.1   an aged analysis of the Receivables sold to
                              LND which remain outstanding at that date from
                              invoice date separately identifying the
                              outstanding amounts by each Customer showing
                              Customer balances as follows: total, up to 30
                              days past its invoice date, 31-60 days past its
                              invoice date, 61-90 days past its invoice date,
                              91-120 days past its invoice date and more than
                              120 days past its invoice date plus a summary
                              giving the totals of each of these categories and
                              identifying those accounts which are either
                              disputed or in solicitors' hands;

                  12.1.9.2    a copy of the sales ledger account relating
                              to the Receivables purchased by LND in the
                              form provided by LND for such purpose under
                              this Agreement;

                  12.1.9.3    a copy of each Customers' month end statement
                              with LND or such other open item breakdown of
                              the Purchased Receivables from a Customer,
                              and in each case in a form acceptable to LND;

                  12.1.9.4    a copy of each Client's purchase ledger at the
                              end of the Accounting Period; and

            12.1.10     ADVICE TRANSMISSION: in relation to each Purchased
                        Receivable (or any Unpurchased Receivable if instructed
                        to do so by LND) promptly send to LND an Advice
                        Transmission (together with such other documents as LND
                        may require (including proof of Delivery of all Goods
                        notified on any Advice Transmission)) after
                        Delivery of the relative Goods or the provision of
                        the relative Services. An Advice Transmission may
                        contain the aggregate amount of various Receivables
                        but Unpurchased Receivables are not to be included
                        in an Advice Transmission unless the Initial Client
                        is instructed to do so by LND.

      12.2  Positive Undertakings
            ---------------------

            The Initial Client undertakes that during the Security Period
            it shall, and it shall procure that each Group Company shall,
            unless LND otherwise agrees:

            12.2.1  PAY TAXES : will cause to be paid and discharged all
                    Borrowed Money when due (except to the extent that they
                    are the subject of a bona fide dispute as determined in
                    the reasonable opinion of LND and that the relevant
                    Client is taking all steps available to it to contest
                    such claim) and all Taxes imposed upon any Client, and
                    will file or cause to be filed all tax returns required
                    to be filed in all jurisdictions in which it is situated
                    or carries on business or is otherwise subject to
                    Taxation and pay all Taxes agreed with the Inland Revenue
                    or relevant authority shown to be due and payable on such
                    returns or any assessments made against it;

            12.2.2  INSURANCE:

                  12.2.2.1    maintain and keep in force at all times such
                              insurance policies as have been disclosed in
                              writing to LND prior to the date hereof;

                  12.2.2.2    duly and punctually pay all premiums and
                              other moneys due and payable under all such
                              insurances as aforesaid and promptly upon
                              request by LND produce to the LND premium
                              receipts or other evidence of the payment
                              thereof;

            12.2.3  AUTHORISATION: obtain, maintain and comply with the terms
                    of any authorisation, approval, licence, consent,
                    exemption, clearance, filing or registration required:

                  12.2.3.1    for the conduct of its business, trade and
                              ordinary activities; and

                  12.2.3.2    to enable it to perform its obligations under,
                              or the validity, enforceability or admissibility
                              in evidence of, any Discounting Document;

            12.2.4  ACCESS: immediately upon request being given to the Initial
                    Client by LND, permit LND and any person (being an
                    accountant, auditor, solicitor, valuer or other
                    professional adviser of LND) authorised by LND to have,
                    at any time during business hours access to the property,
                    premises and accounting books and records of any Group
                    Company and to the officers of any Group Company;

            12.2.5  FURTHER DOCUMENTS: at the request of LND, do or procure
                    the doing of all such things and execute or procure the
                    execution of all such documents as are, in the reasonable
                    opinion of LND, necessary or desirable to ensure that LND
                    obtains all its rights and benefits under the Discounting
                    Documents but so that the requirement of reasonableness
                    in this Clause 12.2.5 shall not apply to any assignment
                    over the Purchased Receivables required by LND, whose
                    requirements in this respect shall not be fettered in any
                    way;

            12.2.6  DELIVERY OF DECLARATIONS, ETC.: within any relevant
                    period paid down in any statute, law or regulation make
                    all necessary declarations and deliver all necessary
                    forms and documents required to be delivered to, filed
                    with or registered with any United Kingdom governmental,
                    statutory or other body or agency by it in connection
                    with the Transaction Documents and any of the
                    transactions contemplated under the Transaction
                    Documents;

            12.2.7  COMPLIANCE WITH ENVIRONMENTAL LAW: will procure that its
                    business is carried on in accordance in all material
                    respects with all applicable Environmental Law and that
                    all requisite Environmental Consents are maintained in
                    full force and effect at all times (other than in each
                    case where any breach is the subject of indemnification
                    in favour of the Initial Client under the Acquisition
                    Agreement provided that the Initial Client has taken all
                    steps to promptly enforce such rights);

            12.2.8  AUDITORS CONFIRMATION: use all reasonable endeavours to
                    procure that, within 5 Business Days of the date of
                    appointment as auditors of any Group Company, the
                    relevant accountants deliver to LND a letter from such
                    newly appointed auditors confirming that they are aware
                    of the provisions of Clause 12.4.1 of this Agreement;

            12.2.9  TRANSMISSION BANKING BUSINESS: ensure that all Customers
                    paying Receivables by way of Electronic Transmission are
                    given written instructions of the details of LND's bank
                    account;

            12.2.10     PROTECTION OF RIGHTS UNDER THE ACQUISITION DOCUMENTS:
                        take all reasonable steps to preserve and enforce its
                        material rights arising under any Acquisition Document;

            12.2.11     PERFORMANCE: promptly performs all its further or
                        continuing obligations of whatsoever nature to the
                        Customer arising out of the sale of Goods or the
                        provision of Services;

            12.2.12     NOTICE: give notice to such of the Customers as LND
                        shall direct at any time that the right to the
                        Receivables specified in such notice (which may
                        include Receivables which have not yet come into
                        existence) has been assigned to (or purchased by)
                        LND, such notice to be in such form as LND shall
                        require;

            12.2.13      BOOKS OR RECORDS: procure that all entries relating
                         to the sale of any Receivable by each Client to LND
                         are duly and promptly recorded in the books of that
                         Client and to ensure that all accounts maintained in
                         the books or records of the Clients in the names of
                         its Customers bear a conspicuous notation that they
                         have been assigned to LND;

            12.2.14      PAYMENT TIMING: procure that any Purchased
                         Receivable becomes due and payable within 120 days of
                         the delivery of the relevant invoice;

            12.2.15      DELIVERY AND SERVICES: procure that in relation to
                         each Purchased Receivable, the Goods have been duly
                         Delivered or the Services duly provided;

            12.2.16      BONA FIDE OBLIGATION: procure that each Purchased
                         Receivable is an existing and bona fide obligation of
                         the Customer arising out of the sale of Goods or the
                         provision of Services by a Client in the ordinary
                         course of its trading;

            12.2.17      CUSTOMER CONTRACTS: procure that each standard terms
                         of trading by each Client with Customers are governed
                         by English law and specify the nature and quantity of
                         the Goods or Services and that each invoice relating
                         to such contract contains the terms and currency of
                         payment and that, to the extent that any contract
                         between a Customer and a Client in respect of a
                         Purchased Receivable is not capable of assignment in
                         favour of LND, such Client will seek consent from the
                         Customer if required by LND (acting reasonably);

            12.2.18      ENFORCEABILITY: use its best endeavours to procure
                         that no Client is in breach of any of its obligations
                         to any Customer and the Customer will accept the Goods
                         or Services and the invoices thereof (or if the
                         Customer is bankrupt or in liquidation the Customer's
                         trustee in bankruptcy or liquidation will accept a
                         proof of debt for the unpaid balance of the invoiced
                         price) without any dispute or claim whatsoever
                         (whether justifiable or not) including disputes as to
                         price, terms, quantity or quality, set-offs or
                         counter-claims or claims or release from liability
                         or inability to pay because of any act of God or
                         public enemy of war or because of the requirement of
                         law (whether in the United Kingdom or elsewhere) or of
                         rules, orders or regulations having the force of law
                         where any of the foregoing would involve or result in
                         a liability owing by any Client in excess of
                         (pound)100,000 at any time;

            12.2.19      RECORDS: it has debt record insurance in a form
                         satisfactory to LND from a reputable insurer in the UK
                         or will (if required by LND) confirm in writing to LND
                         that the sales ledger records are backed up daily and
                         copy disks stored off site at all times and that
                         separate sales ledgers will be maintained by the
                         Client at each Site for each Receivable in each
                         Approved Currency;

            12.2.20      AVAILABLE HEADROOM: it will ensure that, at all
                         times during the Invoice Discounting Facility, the
                         Available Headroom is a minimum amount
                         of(pound)2,500,000 (two million five hundred thousand
                         pounds Sterling) and to the extent that the Available
                         Headroom falls below such amount and to the extent
                         that loans ("Intra Group Loans") to the Initial Client
                         (but excluding for this purpose the Subordinated Loan
                         which shall not be counted towards calculation of the
                         Available Headroom) are less than (pound)2,500,000,
                         will procure that the Holding Company will lend to the
                         Initial Client such sums (on an interest free and
                         unsecured basis so as to increase the amount of the
                         Intra Group Loans up to a maximum amount
                         of(pound)2,500,000) as will result in the Available
                         Headroom being restored to the amount referred to
                         above

                  If in the opinion of LND, (after the increase of such
                  Intra Group Loans) the Available Headroom is still less
                  than (pound)2,500,000 it will take all steps open to it
                  to create the circumstances to permit that the Holding
                  Company will lend to the Initial Client such additional
                  sums (on an interest free and unsecured basis) up to an
                  additional maximum amount of (pound)2,500,000 (Two
                  million five hundred thousand Pounds Sterling) subject to
                  the Holding Company obtaining all required approvals from
                  MTT (as agent) and NWB

                  PROVIDED THAT the Holding Company's obligations to inject
                  such funds by way of loan under this Clause 12.2.20 can
                  never exceed the principal amount of (pound)5,000,000
                  (Five million Pounds Sterling);

            12.2.21     SPECIFIC CONDITIONS: will comply at all times with
                        the Specific Conditions;

            12.2.22     DORMANT COMPANIES: procure that no Dormant Subsidiary
                        will acquire any assets or assume any liabilities;

            12.2.23     YEAR 2000 COMPLIANT: use best endeavours to procure
                        that all computer hardware, software, embedded
                        chips and related systems are, or will be by 30
                        September 1999, Year 2000 Compliant;

            12.2.24      SUBSIDIARY ACCESSION: to the extent that it is
                         lawful to do so (and if and to the extent it is
                         unlawful to do so, will, and will procure that any
                         Subsidiary will comply, with all applicable
                         legislation in ensuring that it is lawful to do so)
                         will procure, that a deed or other documentation, in
                         form and substance satisfactory to LND incorporating
                         provisions substantially the same as those in the
                         guarantees and debentures (comprised in the
                         Discounting Documents) and/or such other Discounting
                         Documents as LND may require shall be executed and
                         delivered to LND by any Subsidiary of the Initial
                         Client, promptly upon its becoming such a Subsidiary,
                         unless otherwise agreed by LND;

            12.2.25      US LOCKBOX ACCOUNT: will require all of its
                         Customers based in the United States of America or
                         paying Remittances in United States Dollars to make
                         such payments into the US Lockbox Account; and

            12.2.26      INVOICES: will ensure that all invoices issued by
                         each Client in respect of Purchased Receivables
                         will contain a written direction by such Client
                         that all Remittances in respect of such invoice
                         shall be paid to LND's bank account at NWB.

      12.3  Negative undertakings
            ---------------------

            The Initial Client undertakes that during the Security Period
            it shall not, and it shall procure that none of the Group
            Companies shall, unless LND otherwise agrees:

            12.3.1  NEGATIVE PLEDGE: create or permit to subsist any Security
                    Interest over any of its assets (including, but without
                    limitations, its interest in the US Lockbox Account or
                    any monies standing to the credit of such account) other
                    than Permitted Security Interests;

            12.3.2  CHANGE OF BUSINESS: make any substantial change to the
                    general nature or scope of the business of the Group as a
                    whole from that carried on at the date of this Agreement;

            12.3.3  MERGERS: enter into any amalgamation, demerger, merger or
                    reconstruction or any joint venture or partnership
                    agreement;

            12.3.4  BORROWED MONEY: incur or permit to subsist any Borrowed
                    Money other than Permitted Borrowed Money;

            12.3.5  ACQUISITIONS: acquire any business of or shares or
                    securities of any company (other than a Charging Group
                    Company);

            12.3.6  DIVIDENDS AND THE SUBORDINATED LOAN: in respect of the
                    Initial Client only other than as permitted by the NWB
                    Agreement, make, pay or declare any dividend or other
                    distribution in relation to any shares forming part of
                    its issued share capital or repay or prepay the
                    Subordinated Loan or pay any interest in respect of the
                    Subordinated Loan; nor

            12.3.7  DEALINGS WITH RECEIVABLES: other than in favour of LND,
                    sell, factor discount or otherwise dispose of or enter
                    into any agreement under which it may be or become
                    obliged to sell, factor, discount or dispose of any
                    Receivable; nor

            12.3.8  DEALINGS WITH AFFILIATES: other than inter company
                    trading carried out between Clients and the Holding
                    Company and any of its other Subsidiaries on an arm's
                    length basis and on terms where the transfer of assets or
                    liabilities are settled on a cash transfer basis
                    immediately on transfer of the relevant assets and
                    liabilities, provide Goods or Services to an Affiliate.

            12.3.9  DISPOSALS: make any Disposals other than Permitted
                    Disposals.;

            12.3.10 MEMORANDUM AND ARTICLES OF ASSOCIATION: it will not
                    alter or vary any provision of its Memorandum and
                    Articles of association or convene any meeting with a
                    view either to the alteration of any provision of its
                    Memorandum of Association or Articles of Association or
                    to the passing of a resolution that it be wound up
                    (except for the purpose of a reconstruction or
                    amalgamation whilst solvent on terms previously
                    approved in writing by LND (such approval not to be
                    unreasonably withheld or delayed)); and

            12.3.11 REDEMPTION OF SHARES: without the prior written
                    consent of LND, make any redemption of any of its
                    shares, purchase any of its shares or otherwise reduce
                    its issued share capital.

      12.4  Financial Undertakings
            ----------------------

            12.4.1  The Initial Client undertakes to ensure that during the
                    Security Period unless LND otherwise agrees:

                  12.4.1.1    PBIT TO INTEREST
                              ----------------

                              the ratio of PBIT to Interest for each period
                              referred to in Column A below shall not be
                              less than the ratio set out in Column B below
                              opposite that period:-

                              COLUMN A                           COLUMN B

                              Commencement Date to 30/9/99       1.5:1
                              Commencement Date to 31/12/99      1.75:1
                              Commencement Date to 31/3/00       2:1
                              1/7/99 to 30/6/00                  2.25:1
                              1/10/00 to 30/9/00                 2.5:1
                              1/1/00 to 31/12/00 and thereafter  2.75:1

                  12.4.1.2    MINIMUM ADJUSTED TANGIBLE NET WORTH

                              The Adjusted Tangible Net Worth shall not be
                              less than (pound)6,250,000 on Commencement
                              Date and at any time in relation to each
                              period from the date set out in Column A
                              below to the date set out in Column B below
                              opposite such first mentioned date shall not
                              be less than the amount set out in Column C
                              below opposite both such dates:


                              COLUMN A             Column B          Column C
                              Commencement Date    30/12/99   (pound)6,250,000
                              31/12/99             30/3/00    (pound)7,250,000
                              31/3/00              29/6/00    (pound)7,450,000
                              30/6/00              29/9/00    (pound)7,950,000
                              30/9/00              30/12/00   (pound)8,650,000
                              31/12/00             30/12/01   (pound)9,350,000
                              31/12/01 and thereafter         (pound)10,000,000


                  12.4.1.3    CAPITAL EXPENDITURE

                              the Capital Expenditure incurred by the
                              Initial Client in any period set out in
                              Column A below shall not exceed the amount
                              set out opposite such period in Column B
                              below:


                              COLUMN A                    Column B

                              Commencement Date to        (pound)1,600,000
                              31/12/99
                              1/1/00 to 31/12/00 and      (pound)2,100,000
                              thereafter

                              Provided that, for the avoidance of doubt:-

                              (i) the amount of Capital Expenditure in
                              Column B for the period from Commencement
                              Date to 31/12/00 shall exclude the costs
                              associated with the closure of Ductile Hot
                              Mill or the partial closure of Dudley Port
                              Steel Mill, Longmores or GB Steel Bar (which
                              costs shall be limited to a maximum of
                              (pound)1,500,000); and

                              (ii) the amounts set out in Column B shall
                              exclude any amounts re-invested by the Client
                              in the Business (as defined in the NWB
                              Agreement);

                  12.4.1.4    LIQUIDITY

                              the ratio of Current Assets to Current
                              Liabilities shall at all times not be less than
                              1.5:1

                  12.4.1.5    If the directors of any Group Company
                              determine at any time during the Security Period
                              that the accounting reference date of that Group
                              Company has or should be changed or any of the
                              accounting principles applied in the preparation
                              of any of the Accounts and the Management
                              Accounts shall be different from the accounting
                              principles previously used, or if as a result of
                              the introduction or implementation of any SSAP or
                              FRS or any change in any of them or in any
                              applicable law such accounting principles are
                              required to be changed the Initial Client shall
                              promptly give notice to LND of that change,
                              determination or requirement.

                  12.4.1.6    If LND believes that the financial
                              undertakings set out in this Clause 12.4 need to
                              be amended as a result of any such change,
                              determination or requirement, the Initial Client
                              shall negotiate with LND in good faith to amend
                              the existing financial undertakings so as to
                              provide LND with the same protections as the
                              financial undertakings set out in this Clause
                              12.4.

                  12.4.1.7    If the Initial Client and LND cannot agree
                              such amended financial undertakings within 30
                              days of the notice contained in Clause 12.4.2.1,
                              the Initial Client and LND shall jointly nominate
                              a firm of chartered accountants to settle the
                              amended financial undertakings, or in default of
                              such nomination, LND shall request the President
                              for the time being of the Institute of Chartered
                              Accountants in England and Wales to nominate
                              a firm of chartered accountants for that
                              purpose. Such accountants shall act as
                              experts and not arbitrators and their
                              decision shall be final and binding on the
                              Parties. The costs of such accountants shall
                              be paid by the Initial Client.

            12.4.2  The calculation of ratios and other amounts under this
                    Clause 12.4 shall be made by LND by reference to the
                    latest Accounts, Management Accounts and other financial
                    information of the Group Companies for the Financial Year
                    of the Initial Client, or other period in relation to
                    which the calculation falls to be made. Each
                    determination of LND under this Clause 12.4 shall be
                    conclusive and binding on the Clients except for any
                    manifest error.

13.   DEFAULT
      -------

      13.1 Each of the following shall be a Default:

            13.1.1  Non-Payment: a Client does not pay on the due date any
                    -----------
                    amount payable by it under this Agreement at the place at
                    and in the currency and funds in which it is expressed to
                    be payable unless the failure to pay such amount is due
                    solely to administrative or technical delays in the
                    transmission of funds which are not the fault of that
                    client and such amount is paid within 2 Business Days
                    after its due date for payment; or

            13.1.2  Other Defaults: any Group Company breaches any of its
                    --------------
                    obligations under any Discounting Document (other than
                    the obligations referred to in Clause 13.1.1) and if that
                    breach is capable of remedy, it is not remedied within 5
                    Business Days after written notice of that breach has
                    been given by LND to the Initial Client; or

            13.1.3  Breach of representation or warranty: any representation
                    ------------------------------------
                    warranty or statement made or deemed to be repeated by
                    any Group Company under any Discounting Document or in
                    any document delivered by or on behalf of any Client
                    under or in connection with any Discounting Document is
                    materially incorrect when made or deemed to have been
                    repeated unless the underlying circumstances (if in LND's
                    opinion, capable of remedy) are remedied within 3
                    Business Days after LND shall have given notice to the
                    Initial Client of such incorrect representation, warranty
                    or statement and of the action required by LND to remedy
                    the same; or

            13.1.4  Unlawfulness or repudiation: it is unlawful for any Group
                    ---------------------------
                    Company to perform or comply with, or any Group Company
                    repudiates, any of itsobligations under any Discounting
                    Document ; or

            13.1.5  Cross-default:
                    -------------

                   13.1.5.1   any Borrowed Money of the Holding Company or
                              any of its Subsidiaries at any time becomes
                              prematurely due and payable or any creditor of
                              the Holding Company or any of its Subsidiaries
                              becomes entitled to declare any such Borrowed
                              Money due and payable prior to the date when they
                              would otherwise have become due or any guarantee
                              or indemnity given by the Holding Company or any
                              of its Subsidiaries in respect of any such
                              indebtedness is not honoured when due and called
                              upon provided that such sums exceed(pound)100,000
                              (or its equivalent at NWB's spot rate of exchange
                              in any other currency); or

                  13.1.5.2    any Borrowed Money of the Holding Company or
                              any of its Subsidiaries is not paid as and
                              when the same is or becomes due and payable;
                              or

                  13.1.5.3    any Security Interest over any assets of the
                              Holding Company or any of its Subsidiaries
                              securing Borrowed Money or any guarantee or
                              indemnity given by the Holding Company or any of
                              its Subsidiaries in respect of such Borrowed
                              Money becomes enforceable and steps are taken to
                              enforce the same;

            13.1.6  Attachment or distress: a creditor or encumbrancer
                    ----------------------
                    attaches or takes possession of or a distress, execution
                    sequestration or other process is levied or enforced upon
                    against any of the assets of any Group Company and such
                    process is not being discharged within 7 days; or

            13.1.7  Insolvency:
                    ----------

                  13.1.7.1    a Group Company is deemed unable to pay its
                              debts in accordance with section 123(1) or (2) of
                              the Insolvency Act 1986 (as that section may be
                              amended by order under section 416 of the
                              Insolvency Act 1986 or otherwise); or

                  13.1.7.2    a Group Company becomes, or admits to being,
                              unable to pay its debts as they fall due; or

                  13.1.7.3    a Group Company otherwise becomes insolvent
                              or stops or suspends making payments (whether
                              of principal or interest) with respect to all
                              or any class of its debts or announces an
                              intention to do so; or

            13.1.8  Adjudication or appointment: any adjudication order or
                    appointment is made under or in relation to any of the
                    proceedings referred to in Clause 13.1.7 or 13.1.9 or

            13.1.9  Administration:
                    --------------

                  13.1.9.1    any meeting of any Group Company is convened
                              for the purpose of considering any resolution
                              to present an application for an
                              administration order; or

                  13.1.9.2    a petition for an administration order in
                              relation to any Group Company is presented to
                              the court; or

                  13.1.9.3    any Group Company passes a resolution to
                              present an application for an administration
                              order; or

                  13.1.9.4    an administration order is made in relation to
                              any Group Company ; or

            13.1.10      Compositions etc.: any steps are taken or
                         -----------------
                         negotiations commenced, by any Group Company or by the
                         creditors generally of any Group Company (or any class
                         of them) with a view to proposing (under any enactment
                         or otherwise) any kind of composition, scheme of
                         arrangement, compromise or arrangement, in each case
                         involving any Group Company and any of its creditors
                         generally (or any class of them); or

            13.1.11     Appointment of receivers and managers:
                        -------------------------------------

                  13.1.11.1   any administrative or other receiver or any
                              manager is appointed of any Group Company or
                              any part of its assets and/or undertaking; or

                  13.1.11.2   the directors of any Group Company request
                              any person to appoint such a receiver or
                              manager; or

                  13.1.11.3   any other steps are taken to enforce any
                              Security Interest over all or any part of the
                              assets and/or undertaking of the Initial
                              Client or any of its Subsidiaries; or

            13.1.12     Winding up:
                        ----------

                  13.1.12.1   any meeting of any Group Company or any of
                              its Subsidiaries is convened for the purpose
                              of considering any resolution for (or to
                              petition for) its winding up; or

                  13.1.12.2   any Group Company passes such a resolution; or

                  13.1.12.3   any person presents any petition for the
                              winding up of any Group Company which is not
                              withdrawn or discharged within 6 Business
                              Days of service; or

                  13.1.12.4   an order for the winding up of any Group
                              Company is made not being a winding-up or
                              dissolution of such company involving an
                              amalgamation or reorganisation on a solvent basis
                              to which LND has given its prior written consent
                              (such consent not to be unreasonably withheld or
                              delayed); or

            13.1.13      Striking Off: any corporate, legal or
                         ------------
                         administrative proceedings are commenced with a
                         view to the striking off of any Group Company not
                         being a striking off involving an amalgamation or
                         reorganisation on a solvent basis to which LND has
                         given its prior written consent (such consent not
                         to be unreasonably withheld or delayed); or

            13.1.14      Analogous Proceedings: there occurs, in
                         ---------------------
                         relation to any Group Company in any country or
                         territory in which any of them carries on business
                         or to the jurisdiction of whose courts any part of
                         their assets is subject, any event which, in the
                         opinion of LND, appears in that country or
                         territory to correspond with, or have an effect
                         equivalent or similar to, any of those mentioned
                         in Clauses 13.1.6 to 13.1.13 (inclusive) or any
                         Group Company otherwise becomes subject, in any
                         such country or territory, to the operation of any
                         law relating to insolvency, bankruptcy or
                         liquidation; or

            13.1.15      Cessation of business: any Group Company (other
                         ---------------------
                         than a Dormant Subsidiary) suspends, ceases or
                         threatens to suspend or cease to carry on the whole
                         or a substantial part of its business; or

            13.1.16      Change of control: any person or persons (not
                         -----------------
                         being a member of the Initial Client at the date
                         of this Agreement) acquires or agrees to acquire
                         or has an option to acquire any interest in the
                         equity share capital (as defined by section 744 of
                         the Companies Act 1985) of the Initial Client; or

            13.1.17      Material adverse change: there occurs a Material
                         -----------------------
                         Adverse Change; or

            13.1.18      Change of management: if any two of Michael
                         --------------------
                         Scharf, Ray Rozanski or Tony Bagshawe cease to be
                         employed by the Holding Company or any of its
                         Subsidiaries or if Tony Bagshawe ceases to be
                         employed by the Initial Client and a replacement
                         (satisfactory to LND) is not appointed to assume
                         his role and duties within 3 months of his ceasing
                         to be employed by the Initial Client; or

            13.1.19      Listing: there is a Listing; or
                         -------

            13.1.20      Guarantee: the Guarantee is determined or
                         ---------
                         repudiated or any surety provided pursuant to this
                         Agreement by the Holding Company or any of its
                         Subsidiaries is determined.

      13.2  Acceleration etc.
            -----------------

            If a Default occurs LND may, by notice (a "Default Notice") to
            the Initial Client:

            13.2.1  cancel the Invoice Discounting Facility and require the
                    Clients immediately to repurchase the Purchased
                    Receivables by payment to LND of amounts (in each
                    Approved Currency) equal to the Funding Amounts (for each
                    Approved Currency) and to pay all other sums payable
                    under this Agreement, whereupon they shall become
                    immediately due and payable. Upon the service of any
                    Default Notice LND's obligations under this Agreement
                    shall be terminated and the Invoice Discounting Facility
                    shall be cancelled and reduced to zero; or

            13.2.2  place all or any part of the Invoice Discounting Facility
                    repayable on demand, so that the Initial Client shall be
                    obliged to immediately repurchase the Purchased
                    Receivables purchased by LND for an amount equal to the
                    Funding Amount together with interest accrued thereon
                     which shall be due and payable on LND's demand.

14.   SET-OFF
      -------

      LND may set off any obligation owed by a Client under any Discounting
      Document against any obligation owed by LND to that Client,
      regardless of the place of payment, booking branch or currency of
      either obligation. If the obligations are in different currencies,
      LND may convert either obligation at the relevant spot rate of
      exchange of NWB for the purpose of the set-off and such calculation
      shall, in the absence of manifest error, be binding upon the Client
      in all respects.

      For the avoidance of doubt, there shall be excluded from the effect
      of this clause any credit balances arising in favour of any Client
      solely as a consequence of it paying money to LND when it is not
      obliged to do so under this Agreement, including any payments made in
      error.

15.   FEES AND EXPENSES
      -----------------

      15.1  Expenses
            --------

            The Initial Client shall on demand pay all reasonable expenses
            incurred (including legal, valuation and accounting fees) and
            any VAT on those expenses:

            15.1.1  by LND in connection with the negotiation, preparation
                    and execution of the Discounting Documents and the other
                    documents contemplated by the Discounting Documents;

            15.1.2  by LND in connection with the granting of any release,
                    waiver or consent or in connection with any amendment or
                    variation of any Discounting Document; and

            15.1.3  by LND in enforcing, perfecting, protecting or preserving
                    (or attempting so to do) any of its rights, or in suing
                    for or recovering any sum due from a Client or any other
                    person under any Discounting Document or in investigating
                    any possible Default.

      15.2  Administration Fees
            -------------------

            The Initial Client shall pay to LND an annual administration
            fee of (pound)10,000 plus VAT per Site (with a minimum of
            (pound)50,000 payable each year). This fee will be reviewed
            once the proposed consolidation of the Sites has taken place
            and is payable each year in advance with the first such payment
            being payable upon the date of this Agreement.

      15.3  Non Utilisation Fee
            -------------------

            15.3.1  The Initial Client shall pay non-utilisation fees to LND
                    at the rate of 0.75 per cent per annum above Base Rate
                    from time to time on the difference between the average
                    Sterling Funding Amount during the relative period and
                    the Available Amount;

            15.3.2  The non-utilisation fee shall accrue from day to day
                    throughout the applicable period on the basis of a 365
                    days' year and shall be paid in arrears on each
                    succeeding Quarter Day and the Termination Date.

      15.4  Documentary Taxes Indemnity
            ---------------------------

            Although it is not believed by the Parties that any Taxes or
            stamp duty are payable as a consequence of the execution of
            this Agreement or the transactions contemplated by it, if that
            belief is found to be erroneous or if, after the date hereof,
            the law in such respect is changed, all stamp, documentary,
            registration or other like duties or Taxes, including any
            penalties, additional, fines, surcharges or interest relating
            to those duties and Taxes, which are imposed or chargeable on
            or in connection with any Discounting Document shall be paid by
            the Clients. LND shall be entitled but not obliged to pay any
            such duties or Taxes (whether or not they are its primary
            responsibility). If LND does so the Client shall on demand
            indemnify LND against those duties and Taxes and against any
            reasonable costs and expenses incurred by LND in discharging
            them.

      15.5  VAT
            ---

            15.5.1  All payments made by a Client under the Discounting
                    Documents are calculated without regard to VAT. If any
                    such payment constitutes the whole or any part of the
                    consideration for a taxable or deemed taxable supply
                    (whether that supply is taxable pursuant to the exercise
                    of an option or otherwise) by LND, the amount of that
                    payment shall be increased by an amount equal to the
                    amount of VAT which is chargeable in respect of the
                    taxable supply in question.

            15.5.2  No payment or other consideration to be made or furnished
                    to a Client by LND pursuant to or in connection with any
                    Discounting Document or any transaction or document
                    contemplated in any Discounting Document may be increased
                    or added to by reference to (or as a result of any
                    increase in the rate of) any VAT which shall be or may
                    become chargeable in respect of any taxable supply.

      15.6  Indemnity payments
            ------------------

            15.6.1  Where in any Discounting Document a Client has an
                    obligation to indemnify or reimburse LND in respect of
                    any loss or payment, the calculation of the amount
                    payable by way of indemnity or reimbursement shall take
                    account of the likely Tax treatment in the hands of LND
                    (as determined by LND's auditors) of the amount payable
                    by way of indemnity or reimbursement and of the loss or
                    payment in respect of which that amount is payable.

                    This Clause 15.6.1 does not apply to any corporation Tax
                    incurred by LND on its overall net income.

            15.6.2  If (as a consequence of this Clause 15.6) LND obtains a
                    refund of tax, or credit against tax on its overall net
                    income, by reason of a Client paying an
                    additional amount under this Clause 15.6 (a "Tax
                    Credit"), and LND is able to identify the Tax Credit as
                    being attributable, wholly or partly to such additional
                    amount, then LND shall reimburse to the Clients such
                    amounts as it shall reasonably determine to be the
                    proportion of the Tax Credit as will leave LND (after
                    that reimbursement) in no better or worse position that
                    it would have been in if the additional payment had not
                    been required. LND shall not be obliged to disclose any
                    confidential information regarding its business, tax
                    affairs or computations to a Client.


      15.7  Debiting authority
            ------------------

            The Clients authorise LND to debit the amount of any fees
            payable by any of them under this Agreement from any account
            held by it with LND.

16.   WAIVERS: REMEDIES CUMULATIVE
      ----------------------------

      The rights of LND under the Discounting Documents:

      16.1  may be exercised as often as necessary;

      16.2  are cumulative and not exclusive of its rights under the general
            law; and

      16.3  may be waived only in writing and specifically.

Delay in exercising or non-exercise of any such right is not a waiver of
that right.


17.   MISCELLANEOUS
      -------------

      17.1  Severance
            ---------

            If any provision of this Agreement is or becomes illegal,
            invalid or unenforceable in any jurisdiction, that shall not
            effect:

            17.1.1  the legality, validity or enforceability in that
                    jurisdiction of any other provision of this Agreement; or

            17.1.2  the legality, validity or enforceability in any other
                    jurisdiction of that or any other provision of this
                    Agreement.

      17.2  Counterparts
            ------------

            This Agreement may be executed in any number of counterparts
            and this shall have the same effect as if the signatures on the
            counterparts were on a single copy of this Agreement.

18.   NOTICES
      -------

      18.1  Method
            ------

            Each notice or other communication to be given under this
            Agreement shall be given in writing in English and, unless
            otherwise provided, shall be made by telex, fax or letter.

      18.2  Delivery
            --------

            18.2.1  Any notice, proceedings or other documents to be served on
                    the Initial Client pursuant to this Agreement shall be
                    addressed to it at Victoria Steel Works, Bull Lane, Moxley,
                    Wednesbury, West Midlands, WS10 8RS (Marked for the
                    attention of Tony Bagshawe) with a copy to be sent to the
                    Holding Company simultaneously at 667 Madison Avenue, New
                    York, New York 10021, United States of America (Attention
                    Michael Scharf) or such address as the Initial Client or
                    the Holding Company (as the case may be) may hereafter
                    advise LND in writing or sent to it by facsimile at the
                    latest number notified to LND by the Initial Client.
                    Notices sent by facsimile shall be deemed to be given on
                    the date telephone confirmation of receipt is received and
                    notices sent by post first class pre-paid shall be deemed
                    to be served 3 Business Days after despatch provided that
                    if such date of despatch is not a Business Day in the
                    country of the addressee or if the time of despatch of
                    a facsimile is after the close of business for the
                    relevant date in the country of the addressee this
                    shall be deemed to have been received at the opening of
                    business on the next Business Day.

            18.2.2  Any notice or other communication to be given by any
                    Party to LND under this Agreement shall (unless LND has
                    by 15 days' notice specified another address) be given to
                    LND at the address given below:-

                    Smith House
                    Elmwood Avenue
                    Feltham
                    Middlesex
                    TW13 7WD
                    Attention:  the Company Secretary
                    Fax: 0181 895 7568

                    with copies to:

                    Lombard Nat West Commercial Services Limited
                    Alexandra House
                    Lawnswood Park
                    Redvers Close
                    Leeds
                    LS16 6QY
                    Attention: Ian Conway
                    Fax: 0113 230 6690

      18.3  Deemed receipt
            --------------

            Any notice or other communication given by either Party to the
            other shall be deemed to have been received:

            18.3.1  if sent by fax, with a confirmed receipt of transmission
                    from the receiving machine, on the day on which
                    transmitted;

            18.3.2  in the case of a written notice given by hand, on the day
                    of actual delivery; and

            18.3.3  if posted, on the third Business Day or, in the case of
                    airmail, the fifth Business Day following the day on
                    which it was despatched by first class mail postage
                    prepaid or, as the case may be, airmail postage prepaid;

                    provided that a notice given in accordance with the above
                    but received on a day which is not a Business Day or
                    after normal business hours in the place of receipt shall
                    only be deemed to have been received on the next Business
                    Day.

19.   ASSIGNMENTS AND TRANSFERS
      -------------------------

      19.1  Benefit of Agreement
            --------------------

            This Agreement shall be binding upon and enure to the benefit of
            each Party and its successors and assigns.

      19.2  Assignments and transfers by Clients

            No Client shall be entitled to assign or transfer any of its
            rights or obligations under this Agreement.

      19.3  Assignments by LND

            19.3.1  Subject to Clause 19.3.2, LND may assign any of its
                    rights and benefits under the Discounting Documents to
                    another bank or other financial institution.

            19.3.2  LND shall notify the Initial Client of such assignment no
                    less than 30 days before such assignment.

            19.3.3  If the assignee is not:-

                  19.3.3.1    National Westminster Bank plc; or

                  19.3.3.2    a company controlled by National Westminster
                              Bank plc

                  (together a "NatWest Group Company"),

                  the Initial Client (on behalf of the Clients) shall be
                  entitled to repurchase all, but not part of, the
                  Purchased Receivables by giving LND notice (which shall
                  be irrevocable) no more than 90 days after receiving
                  notice of the assignment. The Initial Client's
                  obligations under such notice will be to repurchase the
                  Purchased Receivables by payment to LND of amounts in
                  each Approved Currency equal to the Funding Amounts on
                  the date of payment for each Approved Currency provided
                  always that no repayment fee shall be payable to LND. Any
                  such payment will be subject to Clause 20.1. On such
                  repurchase the Invoice Discounting Facility shall
                  automatically be cancelled and reduced to zero.

      19.4  Transfers by LND
            ----------------

            19.4.1  Subject to Clause 19.4.2, LND may transfer any of its
                    rights and obligations under the Discounting Documents to
                    another bank or other financial institution. The Initial
                    Client shall enter into such documents as LND may
                    reasonably stipulate in order to effect any such
                    transfer.

            19.4.2  LND shall notify the Initial Client of such transfer no
                    less than 30 days before such transfer if the transferee
                    is a NatWest Group Company.

            19.4.3  If the transferee is not a NatWest Group Company, the
                    Initial Client (on behalf of the Clients) shall be
                    entitled to repurchase all, but not part of, the
                    Purchased Receivables by giving LND notice (which shall
                    be irrevocable) no more than 90 days after receiving
                    notice of the transfer The Initial Client's obligations
                    under such notice will be to repurchased the Purchased
                    Receivables by payment to LND of amounts in each
                    Approved Currency provided always that no repayment fee
                    shall be payable to LND. Any such payment will be
                    subject to Clause 20.1. On such repurchase the Invoice
                    Discounting Facility shall automatically be cancelled
                    and reduced to zero.

      19.5  Disclosure of information

            LND may disclose (on a confidential basis) to its professional
            advisers and to any actual or potential assignee, transferee or
            sub-participant any information which LND has acquired under or
            in connection with any Discounting Document.

20.   INDEMNITIES
      -----------

      20.1  Currency indemnity
            ------------------

            20.1.1  Any payment made to or for the account of or received by
                    LND in respect of any moneys or liabilities due, arising
                    or incurred by a Client to LND in a currency (the
                    "CURRENCY OF PAYMENT") other than the currency in which
                    the payment should have made under this Agreement (the
                    "CURRENCY OF OBLIGATION") in whatever circumstances
                    (including as a result of a judgment against a Client)
                    and for whatever reason shall constitute a discharge to
                    that Client only to the extent of the Currency of
                    Obligation amount which LND is able on the date of
                    receipt of such payment (or if such date of receipt if
                    not a Business Day, on the next succeeding Business Day)
                    to purchase with the Currency of Payment amount at its
                    spot rate of exchange (as conclusively determined by LND)
                    in the London foreign exchange market.

            20.1.2  If the amount of the Currency of Obligation which LND is
                    so able to purchase falls short of the amount originally
                    due to LND under this Agreement, then the relevant Client
                    shall immediately on demand indemnify LND against any
                    loss or damage arising as a result of that shortfall by
                    paying to LND that amount in the Currency of Obligation
                    certified by LND as necessary so to indemnify it.

      20.2  General
            -------

            20.2.1  The indemnities in Clause 20.1 shall constitute a
                    separate and independent obligation from the other
                    obligations contained in this Agreement, shall give rise
                    to a separate and independent causes of action, shall
                    apply irrespective of any indulgence granted from time to
                    time and shall continue in full force and effect
                    notwithstanding any judgment or order for a liquidated
                    sum or sums in respect of amounts due under this
                     Agreement or under any such judgment or order.

            20.2.2  The Client will accept a certificate signed by the
                    Company Secretary or a director of LND as to all or any
                    of the following on the date referred to in
                    the certificate:

                  20.2.2.1    the balance on any Receivables Purchased
                              Account and any Memorandum Discounting Statement;

                  20.2.2.2    any loss or damage suffered by LND;

                  20.2.2.3    any other amount payable to LND under the
                              Discounting Documents.

                  In any proceedings such certificate shall be conclusive
                  evidence as to the balance, loss, damage or amount on the
                  date so certified.

21.   LAW & JURISDICTION
      ------------------

      21.1  Law
            ---

            This Agreement is governed by and shall be construed in
            accordance with English law.

      21.2  Jurisdiction
            ------------

            21.2.1  The Parties agree that the courts of England shall
                    have exclusive jurisdiction to settle any disputes
                    which may arise in connection with any Discounting
                    Document and that any judgment or order of an English
                    court in connection with any Discounting Document is
                    conclusive and binding on them and may be enforced
                    against them in the courts of any other jurisdiction.
                    This Clause 21.2.1 is for the benefit of LND only and
                    shall not limit the right of LND to bring proceedings
                    against the Holding Company or any Client in connection
                    with any Discounting Document in any other court of
                    competent jurisdiction (in the country in which the
                    Holding Company or such Client is incorporated or
                    domiciled or in any other country where, in the opinion
                    of LND, assets belonging to such entities are available
                    to satisfy such proceedings) or concurrently in more
                    than one jurisdiction.

            21.2.2  Each Client:

                  21.2.2.1    waives any objections which it may have to
                              the English courts on the grounds of venue or
                              forum non conveniens or similar grounds as
                              regards proceedings in connection with any
                              Discounting Document; and

                  21.2.2.2    consents to service of process by mail or in
                              any other manner permitted by the relevant
                              law.

            21.2.3  Agent for service
                    -----------------

                    Each Client which is not a "company" or an "overseas
                    company" within the meaning of the Act (an "OVERSEAS
                    CLIENT") shall at all times maintain an agent for service
                    of process in England satisfactory to LND. Any writ,
                    summons, judgment or other notice of legal process shall
                    be sufficiently served on each Overseas Client if
                    delivered to that agent at its address for the time
                    being. No Overseas Client shall revoke the authority of
                    that agent. If for any reason that agent no longer serves
                    as agent of each Overseas Client to receive service of
                    process, each Overseas Client shall promptly appoint
                    another such agent and immediately advise LND of that
                    appointment.

22.   EUROPEAN ECONOMIC AND MONETARY UNION
      ------------------------------------

      22.1  MONETARY UNION
            --------------

            If, as a result of the implementation of European economic and
            monetary union ("MONETARY UNION"):-

            22.1.1  the currency in which a Funding Amount (or any other
                    obligation under this Agreement or the Discounting
                    Documents) is denominated ceases to be the lawful
                    currency of the country of that currency and is replaced
                    by a European single currency; or

            22.1.2  that currency and a European single currency are at the
                    same time recognised by the central bank of the country
                    of that currency as the lawful currency of that country;

            and LND so requires, then each amount which would otherwise
            have been payable by the Client under this Agreement or the
            Discounting Documents in that currency shall be paid by the
            Client in the European single currency and the amount so
            payable shall be such amount of the European single currency as
            equals the amount of that currency translated at the rate of
            exchange recognised by the European Central Bank for the
            conversion of the relevant currency into the European single
            currency for the purposes of implementation of monetary union.

      22.2  NECESSARY AMENDMENTS
            --------------------

            If, following the implementation of monetary union, LND so
            requires, this Agreement will be amended to the extent LND
            specifies to be necessary to reflect the implementation of
            monetary union and the redenomination of the Invoice
            Discounting Facility (or part thereof) and to put the Parties
            to this Agreement in the same position, so far as possible,
            that they would have been in had monetary union not occurred
            and the Client agrees to pay the costs of LND incurred in
            respect thereof.

23.   ANNOUNCEMENTS
      -------------

      No announcement concerning the subject matter of this Agreement (or
      any document ancillary to it) shall be made by either Party without
      the prior written approval of the other (such approval not to be
      unreasonably withheld or delayed) except as required by law or by a
      relevant regulatory authority.


IN WITNESS whereof the Parties have caused this Agreement to be duly
executed on the date set out above.

Acknowledged and agreed to as of this 23rd day of August 1999

By:   /s/ Robert J. Kush

Name:  Robert J. Kush

Title:Vice President


For and on behalf of
MANUFACTURERS AND TRADERS TRUST COMPANY


THE INITIAL CLIENT
SIGNED by                           )     /s/   RAYMOND ROZANSKI
                                    )
for and on behalf of                )
NIAGARA LASALLE (UK) LIMITED        )
in the presence of:-                )     /s/   A.J. BAYSHAWE



LND
SIGNED by                           )
                                    )
for and on behalf of                )
LOMBARD NATWEST                     )     /s/   IAN CONWAY
DISCOUNTING LIMITED                 )
in the presence of:-                )

                                          /s/   RUPERT HAGUE-HOLMES
                                                115 Colmore Row
                                                Birmingham
                                                B3 3AL