##### 



[EXECUTION COPY]

SECOND AMENDMENT
TO AMENDED AND RESTATED LOAN AGREEMENT

This SECOND AMENDMENT TO AMENDED AND RESTATED LOAN AGREEMENTdated as of
November 3, 2000 (this Amendment), by and among (a) METALLURG, INC., a
Delaware corporation having its principal place of business at 6 East 43rd
Street, New York, New York 10017 (MI), SHIELDALLOY METALLURGICAL CORPORATION,
a Delaware corporation having its principal place of business at 12 West
Boulevard, Newfield, New Jersey 08344 (SMC) and METALLURG INTERNATIONAL
RESOURCES, LLC, a Delaware limited liability company (successor by merger to
Metallurg International Resources, Inc.) having its principal place of business
at 6 East 43rd Street, New York, New York 10017 (MIR and together with MI and
SMC, the Borrowers), (b) METALLURG SERVICES, INC., a New York corporation
having its principal place of business at 6 East 43rd Street, New York, New
York 10017 (MSI), MIR (CHINA), INC., a Delaware corporation having its
principal place of business at 6 East 43rd Street, New York, New York 10017
(MIR China), and METALLURG HOLDINGS CORPORATION, a New Jersey corporation
having its principal place of business at 12 West Boulevard, Newfield, New
Jersey 08344 (MHC and collectively with MSI and MIR China, the Guarantors),
(c) FLEET NATIONAL BANK(formerly known as BANKBOSTON, N.A.), a national
banking association, as agent (in such capacity the Agent) for itself and the
other financial institutions from time to time parties to the Loan Agreement
referred to below (collectively, the Banks); and (d) the BANKS, amends
certain provisions of the Amended and Restated Loan Agreement dated as of
October 29, 1999, by and among the Borrowers, the Guarantors, the Agent and the
Banks (as amended by that certain First Amendment thereto, dated as of October
11, 2000, and as further amended, modified, supplemented or restated and in
effect from time to time, the Loan Agreement). Terms not otherwise defined
herein which are defined in the Loan Agreement shall have the respective
meanings herein assigned to such terms in the Loan Agreement.

WHEREAS, on November 3, 2000, the Metallurg International Resources, Inc.,
a New York corporation (the Corporation) and a wholly owned subsidiary of MI,
was merged into MIR pursuant to and in accordance with §18-209 of the Delaware
Limited Liability Company Act and §904-A of the New York Business Corporation
Law (the Merger);

WHEREAS, the Majority Banks granted to the Borrowers and the Guarantors
that certain Limited Waiver dated as of November 3, 2000 (the Waiver),
permitting the Merger subject to certain conditions contained therein, and the
Borrowers and the Guarantors and the Agent entered into that certain Assumption
Agreement dated as of November 3, 2000, pursuant to which MIR assumed all
rights and Obligations of the Corporation under and pursuant to the Loan
Documents;

WHEREAS, as a condition to the Waiver the Borrowers agreed to amend
certain terms of the Loan Documents to reflect the Merger; and

WHEREAS, the Agent and the Banks are willing to so amend the terms of the
Loan Agreement in such respects as hereinafter provided upon the terms and
subject to the conditions contained herein;

NOW, THEREFORE,in consideration of the mutual agreements contained in the
Loan Agreement, herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:

§1.    Defined Terms.Capitalized terms used herein without definition that
are defined in the Loan Agreement shall have the same meanings herein as in the
Loan Agreement.



---



##### 



-2-

§2.    Amendment to Loan Agreement.Subject to the terms and conditions set
forth herein and the effectiveness of this Amendment, the Loan Agreement is
hereby amended as follows:

(a)     All references in the Loan Agreement to the terms BankBoston, N.A.,
BankBoston and BKB are hereby amended to refer to Fleet National Bank
(except in the event that such references refer to BankBoston, N.A. as the
former name of Fleet National Bank).

(b)     Section 1.1 of the Loan Agreement is hereby amended by deleting the
definitions of the terms BKB, MIR, Security Documents and Subsidiary in
their entirety and by substituting therefore the following new defined terms



| |                                                                                                                                                   
| | --------------------------------------------------------------------------------------------------------------------------------------------------
| | Fleet National Bank. Fleet National Bank (f/k/a BankBoston,
N.A.), a national banking association, and shall include its
successors and assigns.



| |                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | MIR. Metallurg International Resources, LLC a Delaware
limited liability company formerly known as Metallurg International
Resources, Inc., and a wholly-owned Subsidiary of MI.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Security Documents: The Security Agreement, the Stock
Pledge Agreements, the Foreign Pledge Agreements, the Canadian
Assignment Documents, the Agency Agreements, the Lock Box
Agreement, the Membership Interest Pledge Agreement and all other
security agreements, mortgages, deeds of trust, assignments, or
other instruments or documents, in form and substance satisfactory
to the Agent and the Banks, which shall grant to the Agent, for
the benefit of the Banks and the Agent, Liens upon all of the
Collateral.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Subsidiary: Any corporation, association, trust, limited
liability company or other business entity of which the designated
parent shall at any time own directly or indirectly through a
Subsidiary or Subsidiaries at least a majority (by number of
votes) of the outstanding shares of stock or membership interest
having voting power, regardless of whether such right to vote
depends upon the occurrence of a contingency.

(c)     Section 1.1 of the Loan Agreement is hereby further amended by
inserting the following new definition in the appropriate place in the
alphabetical order thereof:



| |                                                                                                                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Membership Interest Pledge Agreement. The Membership
Interest Pledge Agreement dated as of November 3, 2000, between MI
and the Agent with respect to MIs membership interest in MIR and
in form and substance satisfactory to the Agent and the Banks.

(d)     The Loan Agreement is hereby amended by deleting §6.1 thereto in its
entirety and substituting the following new §6.1:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 6.1 Security of Borrower. The Obligations shall be secured
by (a) a perfected first priority security interest (subject only
to Permitted Liens entitled to priority under applicable law) in
all of the assets of each of the Borrowers (excluding (i) all fee
and leasehold interests of the Borrowers in any real property, (ii)
100% of the capital stock of MIR China and MSI, (iii) 35% of the
capital stock of MHC and MCL, and (iv) any annuities and trust fund
accounts which are dedicated to the payment of environmental
liabilities of the Borrowers pursuant to the express provisions of
the Settlement



---



##### 



-3-



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Agreements, but in any event including the Borrowers residual
interest (if any) in such annuities and trust fund accounts),
whether now owned or hereafter acquired, and (b) a pledge of and
perfected first priority security interest in 100% of the issued
and outstanding capital stock of SMC and the membership interests
in MIR, and 65% of the issued and outstanding capital stock of MHC
and MCL; all pursuant to the terms of, and to the extent provided
in, the Security Documents.

(e)     The Loan Agreement is hereby amended by deleting §7(a) thereto in its
entirety and substituting therefor the following new §7(a):



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)     Each of the Borrowers and each of the Guarantors is duly
organized, validly existing, and in good standing under the laws
of its jurisdiction of incorporation or formation and is duly
qualified and in good standing in every other jurisdiction where
it is doing business and where failure to qualify would have a
Materially Adverse Effect, and the execution, delivery and
performance by each of the Borrowers and each of the Guarantors of
each of the Loan Documents to which it is a party (i) are within
its corporate or other organizational authority, (ii) have been
duly authorized by all necessary corporate action or other
organizational proceedings, (iii) do not conflict with or
contravene its Charter Documents.

(f)     The Loan Agreement is hereby amended by deleting §7(h) and (i) thereto
in their entirety and substituting therefor the following new §7(h) and (i):



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (h)     The execution, delivery, performance of its obligations,
and exercise of its rights under the Loan Documents by each of the
Borrowers and each of the Guarantors, including borrowing under
this Agreement and the obtaining of Letters of Credit (i) do not
require any Consents other than those that have been obtained or
will be obtained prior to the Restatement Date and that are in full
force and effect; and (ii) are not and will not be in conflict with
or prohibited or prevented by (A) any Requirement of Law, or (B)
any Charter Document, corporate minute or resolution or limited
liability company action, instrument, agreement or provision
thereof, in each case binding on it or affecting the property of
the Borrowers or the Guarantors.



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)     None of the Borrowers nor any of the Guarantors is in
violation of (A) any Charter Document, corporate minute or
resolution or limited liability company action, (B) any instrument
or agreement, in each case binding on it or affecting its
property, which violation could have a Materially Adverse Effect,
or (C) any Requirement of Law, in a manner which could have a
Materially Adverse Effect, including, without limitation, all
applicable federal and state tax laws, ERISA, OSHA and
Environmental Laws. Except as set forth in Schedule 7(i), none of
the Borrowers nor any of the Guarantors is a party to a collective
bargaining agreement.

(g)     The Loan Agreement is hereby amended by deleting §8(a)(ii) thereto in
its entirety and substituting therefor the following new §8(a)(ii):



| |                                                                                                                                                                                                                                                                                                                                       
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii)     All corporate or limited liability company action,
third-party consents and governmental approvals necessary for the
valid execution, delivery and performance by each of the Borrowers
and each of the Guarantors of each of the Loan Documents to which
it is a party shall have been duly and effectively taken or (as the



---



##### 



-4-



| |                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------
| | case may be) obtained and evidence thereof satisfactory to the
Agent and the Banks shall have been provided to the Agent and the
Banks.

(h)     The Loan Agreement is hereby amended by deleting §9(c)(ii) thereto in
its entirety and substituting therefor the following new §9(c)(ii):



| |                                                                                                                                                                                                                                                             
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii)     if to the Agent, at One Federal Street, Boston,
Massachusetts 02110, USA, Mail Stop: MA DE 10307X, Attention: Mark
Schafer, or such other address for notice as the Agent shall last
have furnished in writing to the Person giving the notice; and

§3.    Amendment to Loan Documents.Subject to the terms and conditions set
forth herein and the effectiveness of this Amendment, each of the Loan
Documents other than the Loan Agreement is hereby amended as follows:

(a)     All references in such Loan Documents to the terms BankBoston, N.A.,
BankBoston and BKB are hereby amended to refer to Fleet National Bank.

(b)     All references in such Loan Documents to the terms Metallurg
International Resources, Inc. or MIR are hereby amended to refer to
Metallurg International Resources, LLC.

§4.    Change in the Fiscal Year of MI.MIs board of directors has
approved a change in MIs fiscal year from January 31 to December 31,
effective beginning December 31, 2000. The Agent and the Banks hereby consent
to such change. In connection with such change in the fiscal year of MI, the
Borrowers hereby agree to provide to the Agent and the Banks from time to time
as and when requested by the Agent or any Bank such reconciliations and
financial information necessary in order for the Agent and the Banks to
determine compliance with the requirements of the Loan Agreement, including
the financial covenants set forth in §9.3 thereof.

§5.    Representations and Warranties. Each of the Borrowers and the
Guarantors represents and warrants to the Agent and the Banks as follows:

(a)     The representations and warranties of the Borrowers and the Guarantors
set forth in the Loan Agreement (as amended hereby) and the other Loan
Documents, (i) were true and correct in all material respects when made, and
(ii) continue to be true and correct in all material respects on the date
hereof, except to the extent such representations and warranties by their terms
relate solely as of a prior date.

(b)     The execution and delivery by the Borrowers and the Guarantors of this
Amendment and the performance by the Borrowers and the Guarantors of their
agreements and obligations under this Amendment, the Loan Agreement (as amended
hereby) and the other Loan Documents (i) are within the corporate or other
organizational authority of each of the Borrowers and the Guarantors, (ii) have
been duly authorized by all necessary corporate or other organizational
proceedings or actions by each of the Borrowers and the Guarantors, (iii) do
not conflict with or result in any breach or contravention of any provision of
law, statute, rule or regulation to which the Borrowers or the Guarantors are
subject or any judgment, order, writ, injunction, license or permit applicable
to the Borrowers or the Guarantor, and (iv) do not conflict with any provision
of the corporate charter, by-laws or other constituent document of, or any
agreement or other instrument binding upon, the Borrowers or the Guarantors.



---



##### 



-5-

(c)     This Amendment, the Loan Agreement (as amended hereby), and the other
Loan Documents to which any of the Borrowers or the Guarantors is a party
constitute the legal, valid and binding obligations of such Borrowers or
Guarantors (as the case may be), duly enforceable against each such Person in
accordance with their respective terms, except as enforceability is limited by
bankruptcy, insolvency, reorganization, moratorium or other laws relating to or
affecting generally the enforcement of creditors rights and except to the
extent that availability of the remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any proceeding
therefor may be brought.

§6.    Conditions to Effectiveness.This Amendment shall be effective as of
the date hereof upon the satisfaction of the following conditions (each of the
following to be in form and substance satisfactory to the Agent):

(a)     delivery to the Agent of original counterpart signature pages to this
Amendment, duly executed and delivered by the Borrowers, the Guarantors and the
Majority Banks;

(b)     delivery to the Agent of a legal opinion of Clifford Chance Rogers &
Wells LLP as to the consummation of the Merger and the continued enforceability
of the Loan Documents as against MIR;

(c)     MIR or the other Borrowers or Guarantors shall have executed and
delivered to the Agent, as the case may be, (i) an Assumption Agreement
substantially in the form of Exhibit A attached hereto; (ii) a Membership
Interest Pledge Agreement substantially in the form of Exhibit B attached
hereto, and evidence of the registration of the pledge created thereby shall
have been registered on the books and records of MIR; (iii) a Perfection
Certificate of MIR; and (iv) such UCC-1 financing statements and UCC-3
amendments as the Agent shall have requested, each to be in form and substance
satisfactory to the Agent;

(d)     the Borrowers shall have delivered to the Agent, (i) an incumbency
certificate, signed by the member or MIR and giving the name and bearing the
signature of each individual who shall be authorized to sign this Amendment and
the other Loan Documents to which MIR is a party in the name and on behalf of
MIR, (ii) certified true and complete copies of all of MIRs organizational and
constituent documents as in effect on the date hereof, (iii) a certified copy
of MIRs certificate of formation, (iv) a certified copy of MIRs certificate
of conversion, (v) board resolutions or other documents evidencing
authorization of the Conversion and the transactions contemplated by this
Amendment and (v) evidence that MIR shall have filed applications to do
business as a foreign limited liability company in all jurisdictions where such
qualification is necessary; and

(e)     all proceedings in connection with the transactions contemplated by
this Amendment shall be reasonably satisfactory in substance and form to the
Agent, and the Agent shall have received all information and such documents as
the Agent may reasonably request.

§7.    Affirmation and Covenants of Borrowers and Guarantors.

(a)     Each of the Borrowers hereby affirms its absolute and unconditional
promise to perform and pay, to the Banks and the Agent, all Obligations under
the Loan Agreement (as amended hereby) and the other Loan Documents at the
times and in the amounts provided for therein.

(b)     Each of the Guarantors hereby acknowledges that it has read and is
aware of the provisions of this Amendment. Each of the Guarantors hereby
reaffirms its absolute and unconditional



---



##### 



-6-

guaranty of the Borrowers payment and performance of the Obligations
under the Loan Agreement (as amended hereby) and the other Loan Documents.

(c)     Each of the Borrowers hereby covenants and agrees that it shall or
shall cause MIR to deliver to the Agent within thirty (30) days of the date
hereof certificates evidencing that MIR is qualified to do business as a
foreign limited liability company in all jurisdictions where such qualification
is necessary.

§8.    Costs and Expenses.The Borrowers acknowledge and jointly and
severally agree that the reasonable costs and expenses incurred by the Agent
(including attorneys fees) in the preparation, negotiation and execution of
this Amendment and the other documents and instruments contemplated hereby are
for the account of the Borrowers as provided in §16 of the Loan Agreement.

§9.    Miscellaneous Provisions.

(a)     Except as otherwise expressly provided by this Amendment, all of the
terms, conditions and provisions of the Loan Agreement shall remain the same.
It is declared and agreed by each of the parties hereto that the Loan
Agreement, as amended hereby, shall continue in full force and effect, and that
this Amendment and the Loan Agreement shall be read and construed as one
instrument.

(b)     THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT UNDER SEAL AND SHALL
FOR ALL PURPOSES BE GOVERNED BY, AND CONSTRUED ACCORDING TO, THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR
CHOICE OF LAW).

(c)     This Amendment may be executed in any number of counterparts, but all
such counterparts shall together constitute but one instrument. In making
proof of this Amendment it shall not be necessary to produce or account for
more than one counterpart signed by each party hereto against which enforcement
hereof is sought.

(d)     Headings or captions used in this Amendment are for convenience of
reference only and shall not define or limit the provisions hereof.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]



---



##### 



-7-

IN WITNESS WHEREOF,the undersigned have duly executed this Amendment as
a sealed instrument as of the date first above written.



| | METALLURG, INC.
| | ---------------



| | By:
Name:
Title:
| | ----------------



| | SHIELDALLOY METALLURGICAL
CORPORATION
| | -------------------------------------



| | By:
Name:
Title:
| | ----------------



| | METALLURG INTERNATIONAL
RESOURCES, LLC(successor by merger to
Metallurg International Resources, Inc.)
| | ------------------------------------------------------------------------------------------------------



| | By:
Name:
Title:
| | ----------------



| | METALLURG SERVICES, INC.
| | ------------------------



| | By:
Name:
Title:
| | ----------------



| | MIR (CHINA), INC.
| | -----------------



| | By:
Name:
Title:
| | ----------------



| | METALLURG HOLDINGS CORPORATION
| | ------------------------------



| | By:
Name:
Title:
| | ----------------



---



##### 



-8-



| | FLEET NATIONAL BANK
(formerly known as BANKBOSTON, N.A.),
individually and as Agent
| | -----------------------------------------------------------------------------------



| | By:
Name:
Title:
| | ----------------



| | BANK OF SCOTLAND
| | ----------------



| | By:
Name:
Title:
| | ----------------



| | NATIONAL BANK OF CANADA
| | -----------------------



| | By:
Name:
Title:
| | ----------------



| | By:
Name:
Title:
| | ----------------