<PAGE>                                                 SECOND AMENDMENT TO
                                                 RECEIVABLES PURCHASE AGREEMENT


         THIS SECOND AMENDMENT (this "Amendment") dated as of July
12, 1999 is entered into among SEQUA RECEIVABLES CORP., a New
York corporation (the "Seller"), SEQUA CORPORATION, a Delaware
corporation (the "Servicer"), LIBERTY STREET FUNDING
CORPORATION, a Delaware corporation (the "Issuer"), and THE BANK
OF NOVA SCOTIA, a Canadian chartered bank acting through its New
York Agency ("BNS"), as administrator(in such capacity, together
with its successors and assigns in such capacity, the
"Administrator").


                                                                R E C I T A L S
                                                                ---------------

  1. The Seller, the Servicer, the Issuer and the
  Administrator are parties to that certain Receivables Purchase
  Agreement dated as of November 13, 1998, as amended by the
  First Amendment, dated as of May 28, 1999 (the "Agreement").

           2.         The Seller, the Servicer, the Issuer and the
Administrator desire to amend the Agreement as hereinafter set
forth.

         NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:

           1.         Certain Defined Terms.  Capitalized terms which are
                      ---------------------
used herein without definition and that are defined in the
Agreement shall have the same meanings herein as in the
Agreement.

           2.         Amendments to Agreement.  The Agreement is hereby
                      -----------------------
amended as follows:

           2.1        Settlement Procedures. Clause (e) (ii) of the Section
                      ---------------------  ---------------
1.4 of the Agreement is amended in its entirety as follows:

                      "(ii) if on any day any of the representations or
warranties in Section l(g), (m) or (t) of Exhibit III is not
true with respect to any Pool Receivable, the Seller shall be
deemed to have received on such day a Collection of such Pool
Receivable in full (Collections deemed to have been received
pursuant to clause (i) and (ii) of this paragraph (e) are
hereinafter sometimes referred to as "Deemed Collections");


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           2.2        Eligible Receivable. Paragraph (a) of the definition
                      ----------------------------------
of "Eligible Receivable" in Exhibit I to the Agreement is
amended in its entirety as follows:

                        "(a) the obligor of which is (i) a United States
             resident; provided, however, if the Obligor of such
             Receivable is a resident of a jurisdiction other than the
             United States, the aggregate Outstanding Balance of all
             Pool Receivables of such Obligor that are Eligible
             Receivables shall not exceed 2% (other than Rolls Royce
             Plc or any Affiliate or Subsidiary thereof, which shall
             not exceed 8%; provided, however, if its short-term rating
             falls below "A-2" by Standard & Poor's or "P-2" by Moody's
             then such amount shall not exceed 2%) of the Net
             Receivables Pool Balance and when added to the aggregate
             Outstanding Balance of all other Eligible Receivables of
             Obligors that are not residents of the United States shall
             not exceed the lesser of (x) 30% of the Net Receivables
             Pool Balance or (y) 50% of the Capital at such time, (ii)
             not a government or a governmental subdivision, affiliate
             or agency; provided, however, if the Obligor of such
             Receivable is a government or a governmental subdivision,
             affiliate or agency, the aggregate Outstanding Balance of
             all Pool Receivables of such Obligor that are Eligible
             Receivables when added to the aggregate Outstanding
             Balance of all other Eligible Receivables of Obligors that
             are governments or governmental subdivisions, affiliates
             or agencies shall not exceed 10% of the Net Receivables
             Pool Balance at such time, (iii) not subject to any action
             of the type described in paragraph (f) of Exhibit V to the
             Agreement, (iv) not an Affiliate of Sequa or any Affiliate
             of Sequa, and (v) not Korean Airlines or any Affiliate of
             Korean Airlines."

             2.3      Excess Concentration.  The definition of "Excess
                      --------------------
Concentration" in Exhibit I to the Agreement is amended in its
entirety as follows:

             " Excess Concentration" means the sum of the amounts by
               --------------------
which the Outstanding Balance of Eligible Receivables of each
Obligor (together with the Outstanding Balance of Eligible
Receivables of each Affiliate of such Obligor) then in the
Receivables Pool exceeds an amount equal to: (a) the
Concentration Percentage or Special Concentration Percentage, as
applicable, for such Obligor multiplied by (b) the Outstanding
Balance of all Eligible Receivables then in the Receivables
Pool."




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             2.4      Purchase Limit.  The definition of "Purchased Limit"
                      --------------
in Exhibit I to the Agreement is amended by deleting
"$90,000,000" and inserting in its place "$120,000,000."

             2.5      Representations and Warranties of the Seller. Section
                      --------------------------------------------
1 of Exhibit III to the Agreement is amended by adding the
following new paragraph (t) thereto:

             "    (t)  Each Pool Receivable of an Obligor, which
is not a resident of the United States, is not (and shall not at
any time be) subject to any currency controls imposed by any
Governmental Authority under the laws of which such Obligor is
organized or a political subdivision thereof, which currency
controls restrict the ability of such Obligor to pay its
obligations in connection with such Pool Receivable."

           3.         Representations and Warranties.  Each of the Seller
                      ------------------------------
and the Servicer hereby represents and warrants to the
Administrator and the Issuer as follows:

                        (a)      Representations and Warranties.  The
                                 ------------------------------
             representations and warranties of such Person contained in
             Exhibit III to the Agreement are true and correct as of
             the date hereof (unless stated to relate solely to an
             earlier date, in which case such representations and
             warranties were true and correct as of such earlier date).

                      (b)        Enforceability.  The execution and delivery by
                                 --------------
           such Person of this Amendment, and the performance of its
           obligations under this Amendment and the Agreement, as
           amended hereby, are within its corporate powers and have
           been duly authorized by all necessary corporate action on
           its part.  This Amendment and the Agreement, as amended
           hereby, are its valid and legally binding obligations,
           enforceable in accordance with its terms.

                      (c)        Termination Event.  No Termination Event or
                                 -----------------
           Unmatured Termination Event has occurred and is continuing.

           4.         Effectiveness.  This Amendment shall become effective
                      -------------
as of the date hereof upon receipt by the Administrator of the
following, each duly executed and dated as of the date hereof
(or such other date satisfactory to the Administrator), in form
and substance satisfactory to the Administrator:



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                      (a)        counterparts of this Amendment (whether by
           facsimile or otherwise) executed by each of the parties
           hereto;

                      (b)        a written statement from Moody's and Standard &
           Poor's that this Amendment will not result in a downgrade
           or withdrawal of the rating of the Notes; and

                      (c)        such other documents and instruments as the
           Administrator may reasonably request.

           5.         Effect of Amendment.  Except as expressly amended and
                      -------------------
modified by this Amendment, all provisions of the Agreement shall
remain in full force and effect.  After this Amendment becomes
effective, all references in the Agreement (or in any other
Transaction Document) to "the Receivables Purchase Agreement,"
"this Agreement," "hereof," "herein" or words of similar effect,
in each case referring to the Agreement, shall be deemed to be
references to the Agreement as amended by this Amendment.  This
Amendment shall not be deemed to expressly or impliedly waive,
amend or supplement any provision of the Agreement other than as
set forth herein.

           6.         Counterparts.  This Amendment may be executed in any
                      ------------
number of counterparts and by different parties on separate
counterparts, and each counterpart shall be deemed to be an
original, and all such counterparts shall together constitute but
one and the same instrument.

           7.         Governing Law.  This Amendment shall be governed by,
                      -------------
and construed in accordance with, the internal laws of the State
of New York without reference to conflict of laws principles.

           8.         Section Headings.  The various headings of this
                      ----------------
Amendment are inserted for convenience only and shall not affect
the meaning or interpretation of this amendment or the Agreement
or any provision hereof or thereof.