Document:

Exhibit 10.1(j)

                                 THIRD AMENDMENT

                  THIRD AMENDMENT, dated as of March 7, 2000 (this "Amendment"),
to the Second Amended and Restated Credit  Agreement,  dated as of September 15,
1998 (as amended,  supplemented  or otherwise  modified  from time to time,  the
"Credit  Agreement"),  among Hexcel  Corporation (the "Company") and the Foreign
Borrowers  from time to time  party  thereto  (together  with the  Company,  the
"Borrowers"),  the  banks  and other  financial  institutions  from time to time
parties thereto (the "Lenders"),  Citibank,  N.A., as  Documentation  Agent, and
Credit  Suisse  First  Boston,  as  Administrative  Agent  (the  "Administrative
Agent").

                              W I T N E S S E T H:

                  WHEREAS,  pursuant to the Credit  Agreement,  the Lenders have
agreed to make, and have made,  certain loans and other  extensions of credit to
the Borrowers; and

                  WHEREAS,   the  Borrowers  have  requested,   and,  upon  this
Amendment  becoming  effective,  the Lenders  shall have  agreed,  that  certain
provisions of the Credit Agreement be amended in the manner provided for in this
Amendment.

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

                            SECTION I. DEFINED TERMS

                  1.1  Defined   Terms.   Unless   otherwise   defined   herein,
capitalized  terms which are defined in the Credit  Agreement are used herein as
defined therein.

                  1.2  Amendment to subsection 1.1.  Subsection 1.1 of the
Credit Agreement is hereby amended:

                  (a) by deleting therefrom the existing definition of "Leverage
Ratio" and by substituting therefor the following:

                  "Leverage  Ratio":  for any period of four consecutive  fiscal
         quarters,  the  ratio of (a)(i)  Indebtedness  of the  Company  and its
         Subsidiaries on a consolidated  basis as of the last day of such period
         minus  (ii) the  lesser  of (x) the  aggregate  amount of cash and Cash
         Equivalents  held by the Company and its  Subsidiaries  as of such last
         day  and  (y)  $10,000,000  to  (b)  EBITDA  of  the  Company  and  its
         Subsidiaries for such period.

                  (b) by deleting  therefrom the existing  definition of "Senior
Debt Leverage Ratio" and by substituting therefor the following:

                  "Senior  Debt  Leverage   Ratio":   for  any  period  of  four
         consecutive  fiscal  quarters,  the ratio of (a)(i)  Senior Debt of the
         Company and its Subsidiaries on a consolidated basis as of the last day
         of such  period  minus (ii) the lesser of (x) the  aggregate  amount of
         cash and Cash  Equivalents  held by the Company and its Subsidiaries as
         of such last day and (y)  $10,000,000  to (b) EBITDA of the Company and
         its Subsidiaries for such period.

                  (c)  by  deleting  therefrom  in its  entirety  the  table  of
Leverage Ratios and Applicable  Margins  contained in the definition of the term
"Applicable   Margin"  contained  therein  and  by  substituting   therefor  the
following:

                                       80
<PAGE>

<TABLE>
<CAPTION>
    ------------------------------------------------------------------------------------------------------------
                                                       Applicable Margin
                                                        Tranche A Loans
                                                     Revolving Credit Loans
                                                        Swing Line Loans
                                                    European Revolving Loans              Tranche B Loans
                                                                                           Euro-currency
                Leverage Ratio                    Eurocurrency                           Loans      ABR Loans
                                                      Loans         ABR Loans
    ----------------------------------------    ---------------------------------    ---------------------------
     <S>                                            <C>              <C>               <C>           <C>
     Greater than or equal to 5.0 to 1.0            250 b.p.         150 b.p.          300 b.p.      200 b.p.
     Greater than or equal to 4.5 to 1.0,           225 b.p.         125 b.p.          275 b.p.      175 b.p.
           but less than 5.0 to 1.0
     Greater than or equal to 4.0 to 1.0,           200 b.p.         100 b.p.          250 b.p.      150 b.p.
           but less than 4.5 to 1.0
     Greater than or equal to 3.5 to 1.0,           175 b.p.         75 b.p.           250 b.p.      150 b.p.
           but less than 4.0 to 1.0
     Greater than or equal to 3.0 to 1.0,           125 b.p.         25 b.p.           200 b.p.      100 b.p.
           but less than 3.5 to 1.0
     Greater than or equal to 2.5 to 1.0,           87.5 b.p.         0 b.p.           175 b.p.      75 b.p.
           but less than 3.0 to 1.0
     Less than 2.5 to 1.0                             75 b.p.         0 b.p.           175 b.p.      75 b.p.
    ------------------------------------------------------------------------------------------------------------
</TABLE>

                  (d) by deleting  therefrom  the existing  definition of "Fixed
Charge Coverage Ratio" and by substituting therefor the following:

                  "Fixed Charge Coverage Ratio" means the ratio of (i) EBITDA of
         the Company and its Subsidiaries for the most recently completed period
         of four consecutive fiscal quarters, minus Capital Expenditures paid by
         the  Company and its  Subsidiaries  during  such  period  (other  than,
         subsequent  to the date of the Sale (as defined in the Third  Amendment
         to this Agreement) but prior to December 31, 2001, Capital Expenditures
         in an amount not to exceed the Excess Net  Proceeds  (as defined in the
         Third Amendment to this  Agreement)),  plus Net Proceeds of asset sales
         received  during  such  period  to  the  extent  not  included  in  the
         calculation  of EBITDA  for such  period to (ii)  Fixed  Charges of the
         Company and its Subsidiaries for such period.

                               SECTION II. CONSENT

                  2.1  Consent.  Anything  in  subsection  14.6  of  the  Credit
Agreement to the contrary  notwithstanding,  the Lenders  hereby  consent to the
sale on or before  September 30, 2000 by the Company of its Engineered  Products
Division (the "Division") for  consideration  which shall include a cash portion
in an amount not less than $150 million of Net Proceeds (the  "Sale");  provided
that,  anything  in  subsection  10.5 of the Credit  Agreement  to the  contrary
notwithstanding,  (i) on the date of the  completion  of the Sale,  the Borrower
applies the first $150  million of the cash Net  Proceeds  thereof to prepay the
Tranche A Loans and the  Tranche B Loans  ratably  according  to the  respective
aggregate then outstanding  principal amounts thereof,  (ii) with respect to any
amount of such Net  Proceeds  that is in excess of $150 million (the "Excess Net
Proceeds"),  (x) such Excess Net Proceeds  shall be available to the Company for
general corporate purposes,  including Capital Expenditures and, notwithstanding
the  provisions of subsection  14.14 of the Credit  Agreement,  the  prepayment,
repurchase or retirement of Permitted  Subordinated  Indebtedness,  (y) no other
prepayment or Commitment  reduction under the Credit Agreement shall be required
as a result of the receipt of the Excess Net  Proceeds  and (z) with  respect to
subsection 10.5(g)(x),  such Excess Net Proceeds shall not be considered as part
of the first $25,000,000 of Net Proceeds derived from any Net Proceeds Event and
(iii) for  purposes  of  calculating  compliance  with the  financial  covenants
contained in subsection 14.1, for any period in which the Sale is completed, the
Sale and the  repayment of any  Indebtedness  in connection  therewith  shall be
deemed to have been completed on the first day of such period.

                  2.2 Release.  The Lenders and the Borrowers hereby acknowledge
and agree that, notwithstanding anything to the contrary contained in the Credit
Documents,  all of the assets of the Division sold in  connection  with the Sale
shall, effective  simultaneously with the closing of the Sale in accordance with
Section 2.1 of this  Amendment,  be released from the Liens granted  pursuant to
the  Credit  Documents.  Each  Lender  authorizes  and  instructs  each  of  the
Administrative Agent and the Documentation Agent to take, and the Administrative
Agent and  Documentation  Agent  shall  take,  such  action as the  Company  may
reasonably request to evidence such release.

                  2.3  Consent.  Anything  in  subsection  14.6  of  the  Credit
Agreement to the contrary  notwithstanding,  the Lenders  hereby  consent to the
sale,  transfer or other  disposition of all or substantially all of the Capital
Stock or assets of CS Interglas AG for fair market value;  provided that the Net
Proceeds from such sale, transfer or other disposition are applied in accordance
with the provisions of subsection 10.5(g) of the Credit Agreement.

                                       81
<PAGE>

                         SECTION III. INITIAL AMENDMENTS

                  3.1  Financial  Covenant  Amendments.   The  Lenders  and  the
Borrowers hereby agree that on the Effective Date (as defined below)  subsection
14.1 of the Credit Agreement shall be amended to read as follows:

                  "14.1  Financial Condition Covenants .

                  (a)  Minimum  Interest  Coverage  Ratio.  Permit the  Interest
         Coverage Ratio of the Company and its  Subsidiaries  on the last day of
         any fiscal quarter of the Company  occurring  during a period set forth
         below to be less than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ----------------------------------------------------------------------------
                                        Period                                   Ratio
                  ----------------------------------------------------     -------------------
                          <S>                                                 <C>

                           January 1, 2000 - March 31, 2000                   1.80 to 1.0
                             April 1, 2000 - June 30, 2000                    1.80 to 1.0
                           July 1, 2000 - September 30, 2000                  1.80 to 1.0
                          October 1, 2000 - December 31, 2000                 1.85 to 1.0
                             January 1, 2001 - thereafter                     2.50 to 1.0
                  ----------------------------------------------------------------------------
</TABLE>
                  (b) Maximum  Leverage Ratio.  Permit the Leverage Ratio of the
         Company and its  Subsidiaries  on the last day of any fiscal quarter of
         the  Company  occurring  during a period set forth  below to be greater
         than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ----------------------------------------------------------------------------
                                        Period                                   Ratio
                  ----------------------------------------------------    --------------------
                           <S>                                                <C>
                           January 1, 2000 - March 31, 2000                   6.15 to 1.0
                           April 1, 2000 - June 30, 2000                      6.15 to 1.0
                           July 1, 2000 - September 30, 2000                  6.15 to 1.0
                           October 1, 2000 - December 31, 2000                5.75 to 1.0
                           January 1, 2001 - March 31, 2001                   5.00 to 1.0
                           April 1, 2001 - June 30, 2001                      4.75 to 1.0
                           July 1, 2001 - thereafter                          4.50 to 1.0
                  ----------------------------------------------------------------------------
</TABLE>

                  (c) Minimum  Fixed  Charge  Coverage  Ratio.  Permit the Fixed
         Charge  Coverage Ratio of the Company and its  Subsidiaries on the last
         day of any fiscal quarter of the Company  occurring during a period set
         forth below to be less than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ----------------------------------------------------------------------------
                                         Period                                  Ratio
                  -----------------------------------------------------    -------------------
                            <S>                                                <C>
                            January 1, 2000 - March 31, 2000                  1.00 to 1.0
                            April 1, 2000 - June 30, 2000                     1.00 to 1.0
                            July 1, 2000 - September 30, 2000                 1.00 to 1.0
                            October 1, 2000 - December 31, 2000               1.00 to 1.0
                            January 1, 2001 - thereafter                      1.20 to 1.0
                  ----------------------------------------------------------------------------
</TABLE>

                  (d) Maximum Senior Debt Leverage Ratio. Permit the Senior Debt
         Leverage Ratio of the Company and its  Subsidiaries  on the last day of
         any fiscal quarter of the Company  occurring  during a period set forth
         below to be greater than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ----------------------------------------------------------------------------
                                        Period                                   Ratio
                  ----------------------------------------------------     -------------------
                           <S>                                                <C>

                           January 1, 2000 - March 31, 2000                   3.10 to 1.0
                           April 1, 2000 - June 30, 2000                      3.10 to 1.0
                           July 1, 2000 - September 30, 2000                  3.00 to 1.0
                           October 1, 2000 - December 31, 2000                2.75 to 1.0
                           January 1, 2001 - June 30, 2001                    2.50 to 1.0
                           July 1, 2001 - thereafter                          2.25 to 1.0
                  ----------------------------------------------------------------------------
</TABLE>

                  3.2  Amendment to Section 13:  Section 13 of the Credit
Agreement is hereby amended by inserting the following new subsection 13.10:

                                       82
<PAGE>

                  13.10 Real  Property  Mortgage.  If by September 30, 2000 the
         Company shall not have  completed the sale of its  Engineered  Products
         Division for cash in an amount not less than $150 million and satisfied
         the other  requirements  of Section 2.1 of the Third  Amendment  to the
         Credit Agreement,  as soon as practicable after September 30, 2000, (a)
         execute and deliver a first priority  mortgage (other than with respect
         to Liens  permitted by subsection 14.3 of this Agreement) to secure the
         Obligations  in form and substance  satisfactory  to the  Documentation
         Agent in favor  of the  Documentation  Agent,  for the  benefit  of the
         Lenders, covering each parcel of real property then owned in fee by the
         Company or its Subsidiary Guarantors,  which are Domestic Subsidiaries,
         having a fair  market  value in excess of  $1,000,000,  (b) provide the
         Lenders with title reports covering such interest in real property,  in
         form and substance reasonably  satisfactory to the Documentation Agent,
         (c) use  reasonable  best  efforts to obtain any  consents or estoppels
         reasonably deemed necessary or advisable by the Documentation  Agent in
         connection  with such mortgage or deed of trust,  in form and substance
         reasonably satisfactory to the Documentation Agent and (d) if requested
         by the Documentation  Agent,  deliver to the Documentation  Agent legal
         opinions relating to the matters described above,  which opinions shall
         be in form and substance, and from counsel,  reasonably satisfactory to
         the  Documentation  Agent. The real property  mortgages  referred to in
         this subsection 13.10 shall secure the Obligations; provided that, if a
         tax shall be imposed on the recording of a mortgage referred to in this
         subsection,  any such  mortgage  shall be limited to an amount equal to
         100% of the fair market value of the applicable property."

                  3.3  Commitment  Reductions.  The  Lenders  and the  Borrowers
hereby  agree  that on the  Effective  Date  (i)  the  Aggregate  European  Loan
Commitment in effect on the Effective Date shall be reduced,  in accordance with
subsection 10.11(a) of the Credit Agreement, by $15,000,000,  (ii) the Aggregate
Revolving Credit Commitment in effect on the Effective Date shall be reduced, in
accordance with subsection 10.11(a) of the Credit Agreement, by $110,000,000 and
(iii) the Borrowers will comply with the  requirements of subsection 10.5 of the
Credit Agreement in connection therewith.

                       SECTION IV. CONDITIONAL AMENDMENTS

                  The Lenders and the  Borrowers  hereby agree that, if the sale
of the  Division  as  specified  in  Section  2.1 of this  Amendment  shall have
occurred after the date hereof but on or before  September 30, 2000,  subsection
14.1 of the Credit Agreement shall be further amended,  effective simultaneously
with the closing of the sale of the Division, to read as follows:

                  "14.1  Financial Condition Covenants .

                  (a)  Minimum  Interest  Coverage  Ratio.  Permit the  Interest
         Coverage Ratio of the Company and its  Subsidiaries  on the last day of
         any fiscal quarter of the Company  occurring  during a period set forth
         below to be less than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ----------------------------------------------------------------------------
                                        Period                                   Ratio
                  ----------------------------------------------------     -------------------
                           <S>                                                <C>
                           January 1, 2000 - March 31, 2000                   1.85 to 1.0
                           April 1, 2000 - June 30, 2000                      1.85 to 1.0
                           July 1, 2000 - September 30, 2000                  1.85 to 1.0
                           October 1, 2000 - December 31, 2000                1.85 to 1.0
                           January 1, 2001 - March 31, 2001                   2.00 to 1.0
                           April 1, 2001 - June 30, 2001                      2.00 to 1.0
                           July 1, 2001 - September 30, 2001                  2.25 to 1.0
                           October 1, 2001 - December 31, 2001                2.25 to 1.0
                           January 1, 2002 - thereafter                       2.50 to 1.0
                  ----------------------------------------------------------------------------
</TABLE>

                  (b) Maximum  Leverage Ratio.  Permit the Leverage Ratio of the
         Company and its  Subsidiaries  on the last day of any fiscal quarter of
         the  Company  occurring  during a period set forth  below to be greater
         than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ----------------------------------------------------------------------------
                                         Period                                  Ratio
                  -----------------------------------------------------    -------------------
                            <S>                                               <C>
                            January 1, 2000 - March 31, 2000                  6.15 to 1.0
                            April 1, 2000 - June 30, 2000                     6.15 to 1.0
                            July 1, 2000 - September 30, 2000                 6.00 to 1.0
                            October 1, 2000 - December 31, 2000               5.75 to 1.0
                            January 1, 2001 - March 31, 2001                  5.50 to 1.0
                            April 1, 2001 - June 30, 2001                     5.25 to 1.0
                            July 1, 2001 - September 30, 2001                 5.00 to 1.0
                            October 1, 2001 - December 31, 2001               4.75 to 1.0
                            January 1, 2002 - thereafter                      4.50 to 1.0
                  ----------------------------------------------------------------------------
</TABLE>

                                       83
<PAGE>

                  (c) Minimum  Fixed  Charge  Coverage  Ratio.  Permit the Fixed
         Charge  Coverage Ratio of the Company and its  Subsidiaries on the last
         day of any fiscal quarter of the Company  occurring during a period set
         forth below to be less than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ----------------------------------------------------------------------------
                                         Period                                  Ratio
                  -----------------------------------------------------    -------------------
                            <S>                                               <C>
                            January 1, 2000 - March 31, 2000                  1.00 to 1.0
                            April 1, 2000 - June 30, 2000                     1.00 to 1.0
                            July 1, 2000 - September 30, 2000                 1.00 to 1.0
                            October 1, 2000 - December 31, 2000               1.00 to 1.0
                            January 1, 2001 - March 31, 2001                  1.15 to 1.0
                            April 1, 2001 - June 30, 2001                     1.15 to 1.0
                            July 1, 2001 - September 30, 2001                 1.15 to 1.0
                            October 1, 2001 - December 31, 2001               1.15 to 1.0
                            January 1, 2002 - thereafter                      1.20 to 1.0
                  ----------------------------------------------------------------------------
</TABLE>

                  (d) Maximum Senior Debt Leverage Ratio. Permit the Senior Debt
         Leverage Ratio of the Company and its  Subsidiaries  on the last day of
         any fiscal quarter of the Company  occurring  during a period set forth
         below to be greater than the ratio set forth opposite such period:

<TABLE>
<CAPTION>
                  ---------------------------------------------------------------------------
                                        Period                                  Ratio
                  ----------------------------------------------------    -------------------
                           <S>                                               <C>
                           January 1, 2000 - March 31, 2000                  2.75 to 1.0
                           April 1, 2000 - June 30, 2000                     2.75 to 1.0
                           July 1, 2000 - September 30, 2000                 2.75 to 1.0
                           October 1, 2000 - December 31, 2000               2.50 to 1.0
                           January 1, 2001 - March 31, 2001                  2.25 to 1.0
                           April 1, 2001 - June 30, 2001                     2.25 to 1.0
                           July 1, 2001 - September 30, 2001                 2.25 to 1.0
                           October 1, 2001 - December 31, 2001               2.25 to 1.0
                           January 1, 2002 - thereafter                      2.00 to 1.0
                  ---------------------------------------------------------------------------
</TABLE>

                            SECTION V. MISCELLANEOUS

                  5.1 Conditions to Effectiveness  of Amendment.  This Amendment
shall become  effective  (as of the date first set forth) above on the date (the
"Effective Date") upon:

               (a) the Administrative Agent having received counterparts hereof,
          duly executed and delivered by each Borrower, the Documentation Agent,
          the Administrative  Agent, each Subsidiary  Guarantor and the Majority
          Lenders;

               (b) the  Company  having  paid to the  Administrative  Agent  the
          Amendment Fee specified in subsection 5.2 of this Amendment;

               (c) the Documentation  Agent having received  counterparts of the
          Amended and Restated Collateral Agreement, duly executed and delivered
          by the Company and each  Subsidiary  Guarantor,  in a form  reasonably
          satisfactory to the Administrative Agent and the Company;

               (d) the  Documentation  Agent  having  received  the results of a
          recent lien search in each of the  jurisdictions  where  Collateral of
          the  Company  or  its  Subsidiary   Guarantors,   which  are  Domestic
          Subsidiaries,  is located, and such search having revealed no liens on
          any of the  Collateral  of the Company or such  Subsidiary  Guarantors
          except for liens permitted by subsection 14.3 of the Credit  Agreement
          or  discharged  on  or  prior  to  the  Effective   Date  pursuant  to
          documentation satisfactory to the Documentation Agent; and

               (e)  each  document   (including  any  Uniform   Commercial  Code
          financing  statement)  required by the Security Documents or under law
          or  reasonably  requested  by the  Documentation  Agent  to be  filed,
          registered   or   recorded   in  order  to  create  in  favor  of  the
          Documentation  Agent, for the benefit of the Lenders, a perfected Lien
          on the Collateral  described  therein,  prior and superior in right to
          any other Person (other than with respect to Liens expressly permitted
          by subsection  14.3 of the Credit  Agreement)  shall be in proper form
          for filing, registration or recordation.

                  5.2 Amendment Fee. The Company shall pay to the Administrative
Agent,  for the account of each Lender  executing  this  Amendment  on or before
March 7, 2000, an amendment fee (the "Amendment Fee") equal to 12.5 b.p. of each
such  Lender's  applicable  (i)  Commitment,  in the  case of  Revolving  Credit
Commitment,  European Loan Commitment or European Overdraft  Commitment and (ii)
outstanding  Loans,  in the case of  Tranche A Loans and  Tranche B Loans.  Such
Amendment Fee shall be calculated immediately prior to the effectiveness of this
Amendment and shall be payable on the Effective Date.

                                       84
<PAGE>

                  5.3  Representations  and Warranties.  The Company,  as of the
date hereof and after  giving  effect to the  amendments  and consent  contained
herein,  hereby  confirms,   reaffirms  and  restates  the  representations  and
warranties  made by it and each  Foreign  Borrower  in  Section 11 of the Credit
Agreement and otherwise in the Credit Documents to which it is a party; provided
that each  reference  to the Credit  Agreement  therein  shall be deemed to be a
reference to the Credit Agreement after giving effect to this Amendment.

                  5.4 Limited Effect. The execution,  delivery and effectiveness
of this Amendment shall not, except as expressly  provided herein,  operate as a
waiver of any right, power or remedy of any Lender or the  Administrative  Agent
under any of the Credit  Documents,  nor constitute a waiver or amendment of any
provisions of any of the Credit Documents.  Except as expressly modified herein,
all of the provisions and covenants of the Credit Agreement and the other Credit
Documents  are and  shall  continue  to  remain  in full  force  and  effect  in
accordance  with the terms  thereof and are hereby in all respects  ratified and
confirmed.

                  5.5  Counterparts.  This  Amendment  may be executed by one or
more of the  parties  hereto in any number of separate  counterparts  (which may
include  counterparts  delivered  by  facsimile  transmission)  and  all of said
counterparts  taken  together  shall be  deemed to  constitute  one and the same
instrument.  Any executed counterpart delivered by facsimile  transmission shall
be effective as for all purposes hereof.

                  5.6  GOVERNING  LAW  .  THIS  AMENDMENT  AND  THE  RIGHTS  AND
OBLIGATIONS  OF THE PARTIES  HEREUNDER  SHALL BE GOVERNED BY, AND  CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                  IN WITNESS WHEREOF,  the parties hereto have caused this Third
Amendment to be duly executed and delivered by their respective  proper and duly
authorized officers as of the day and year first above written.

                                       85
<PAGE>

HEXCEL CORPORATION
HEXCEL (U.K.) LIMITED
HEXCEL COMPOSITES LIMITED
HEXCEL S.A. (France)
HEXCEL FABRICS S.A.
HEXCEL COMPOSITES S.A. (Belgium)
HEXCEL COMPOSITES S.A. (France)
HEXCEL COMPOSITES GMBH (Austria)
HEXCEL COMPOSITES S.A. (Spain)
HEXCEL COMPOSITES GMBH  (Germany)

By:
      Title:

CREDIT SUISSE FIRST BOSTON, as Administrative Agent and Arranger

By:
      Title:

By:
      Title:

CITIBANK, N.A., as Documentation Agent and as a Lender

By:
      Title:
CREDIT SUISSE FIRST BOSTON, as a Lender

By:
      Title:

By:
      Title:

AERIES FINANCE II LTD.

     By: INVESCO Senior Secured Management, Inc., as Sub-Managing Agent

By:
      Title:

AMARA 2 FINANCE, LTD.

     By: INVESCO Senior Secured Managment, Inc., as Sub-Adviser

By:
      Title:

ARCHIMEDES FUNDING II, Ltd.

     By: ING CAPITAL ADVISORS LLC, as Collateral Manager

By:
      Title:

BALANCED HIGH-YIELD FUND I LTD.

     By: BHF (USA) CAPITAL CORPORATION, as attorney-in-fact

By:
      Title:

By:
      Title:

THE BANK OF NEW YORK

By:
      Title:

BANK ONE, NA

                                       86
<PAGE>

By:
      Title:

BANQUE NATIONALE DE PARIS

By:
      Title:

By:
      Title:

BANQUE WORMS CAPITAL CORPORATION

By:
      Title:

By:
      Title:

BATTERSON PARK CBO 1

     By: GENERAL RE - NEW ENGLAND ASSET  MANAGEMENT, INC., as Collateral Manager

By:
      Title:

CAPTIVA FINANCE LTD.

By:
      Title:

CAPTIVA II FINANCE LTD

By:
      Title:

CERES FINANCE LTD.

     By: INVESCO Senior Secured Management, Inc., as Sub-Managing Agent

By:
      Title

THE CHASE MANHATTAN BANK

By:
      Title:

CHAIO TUNG BANK CO., NEW YORK AGENCY

By:
      Title:

CREDIT AGRICOLE INDOSUEZ

By:
      Title:

By:
      Title:

CREDIT LYONNAIS NEW YORK BRANCH

By:
      Title:

CYPRESSTREE  SENIOR FLOATING RATE FUND

     By: CYPRESSTREE INVESTMENT MANAGEMENT COMPANY, INC., as Portfolio Manager

By:
      Title:

CYPRESSTREE INVESTMENT FUND, LLC

     By: CYPRESSTREE INVESTMENT MANAGEMENT COMPANY, INC., its Managing Member

                                       87
<PAGE>

By:
      Title:

CYPRESSTREE  INVESTMENT
PARTNERS I, LTD.

     By: CYPRESSTREE INVESTMENT MANAGEMENT COMPANY, INC., as Portfolio Manager

By:
      Title:

CYPRESSTREE INSTITUTIONAL FUND, LLC

     By: CYPRESSTREE INVESTMENT MANAGEMENT COMPANY, INC., its Managing Member

By:
      Title:

DEUTSCHE BANK AG NEW YORK BRANCH AND/OR CAYMAN ISLANDS BRANCH

By:
      Title:

By:
      Title:

ERSTE BANK

By:
      Title:

By:
      Title:

FIRST UNION NATIONAL BANK

By:
      Title:

GALAXY CLO 1999-1, LTD.

By:
      Title:

GENERAL ELECTRIC CAPITAL CORPORATION

By:
      Title:

THE INDUSTRIAL BANK OF JAPAN, LIMITED, NEW YORK BRANCH

By:
      Title:

KEYBANK NATIONAL ASSOCIATION

By:
      Title:

KZH CYPRESSTREE-1 LLC

                                       88
<PAGE>

By:
      Title:

KZH ING-2 LLC

By:
      Title:

KZH ING-3 LLC

By:
      Title:

KZH SHOSHONE LLC

By:
      Title:

KZH WATERSIDE LLC

By:
      Title:

MERITA BANK Plc

By:
      Title:

By:
      Title:

METROPOLITAN LIFE INSURANCE COMPANY

By:
      Title:

MORGAN GUARANTY TRUST COMPANY OF NEW YORK

By:
      Title:

NORTH AMERICAN SENIOR FLOATING RATE FUND

     By: CYPRESSTREE INVESTMENT MANAGEMENT COMPANY, INC., as Portfolio Manager

By:
      Title:

OXFORD STRATEGIC INCOME FUND

     By: EATON VANCE MANAGEMENT, as Investment Advisor

By:
      Title:

SENIOR DEBT PORTFOLIO

     By: BOSTON MANAGEMENT AND RESEARCH, as Investment Advisor

By:
      Title:

SOCIETE GENERALE

By:
      Title:

STRATA FUNDING, LTD.

     By: INVESCO Senior Secured Management, Inc., as Sub-Managing Agent

                                       89
<PAGE>

By:
      Title:

UNION BANK OF CALIFORNIA, N.A.

By:
      Title:

VAN KAMPEN SENIOR FLOATING RATE FUND

     By: VAN KAMPAN INVESTMENT              ADVISORY CORP.

By:
      Title:

WACHOVIA BANK, N.A.

By:
         Title

                                       90

         The  undersigned  Subsidiary  Guarantors do hereby consent and agree to
the execution and delivery of this Amendment:

HEXCEL INTERNATIONAL
HEXCEL OMEGA CORPORATION
HEXCEL BETA CORP.
CLARK-SCHWEBEL HOLDING CORP.
CLARK-SCHWEBEL CORPORATION
CS TECH-FAB HOLDING, INC.

By:
Title:

                                       91
<PAGE>Exhibit 10.1(k)

                    AMENDED AND RESTATED COLLATERAL AGREEMENT

                  AMENDED AND RESTATED COLLATERAL  AGREEMENT,  dated as of March
7, 2000, made by each of the signatories  hereto (together with any other entity
that may become a party hereto as provided herein, the "Grantors"),  in favor of
CITIBANK,  N.A., as Documentation  Agent (in such capacity,  the  "Documentation
Agent") for the banks and other financial institutions (the "Lenders") from time
to time parties to the Second Amended and Restated Credit Agreement, dated as of
September 15, 1998 (as amended,  supplemented or otherwise modified from time to
time, the "Credit Agreement"),  among Hexcel Corporation (the "Company") and the
Foreign  Borrowers  from time to time party thereto  (together with the Company,
the "Borrowers"),  the Lenders,  the Documentation Agent and Credit Suisse First
Boston, as Administrative Agent (the "Administrative Agent").

                              W I T N E S S E T H:

                  WHEREAS,  the Lenders have agreed to make extensions of credit
from time to time to the Borrowers pursuant to the Credit Agreement;

                  WHEREAS,  each Grantor will  directly and  indirectly  benefit
from the loans and other financial accommodations made to the Borrowers pursuant
to the Credit Agreement;

                  WHEREAS, the Grantors are parties to the Collateral Agreement,
dated as of September 15, 1998 (as amended,  supplemented or otherwise  modified
from time to time, the "Existing Collateral Agreement"),  with the Documentation
Agent;

                  WHEREAS,  it is a condition  precedent to the effectiveness of
the Third  Amendment  to the Credit  Agreement  that the  Grantors  execute  and
deliver this Agreement;

                  WHEREAS,  the  parties to the  Existing  Collateral  Agreement
desire to amend the Existing Collateral  Agreement,  but only upon the terms and
subject  to the  conditions  set forth  herein,  and each of the  parties to the
Existing  Collateral  Agreement,  for  convenience  of reference,  has agreed to
restate the Existing Collateral Agreement as so amended; and

                  WHEREAS,  each of the parties hereto is agreeable to the terms
and  provisions  of the  Existing  Collateral  Agreement as amended and restated
hereby;

                  NOW,  THEREFORE,  in  consideration of the premises and mutual
covenants herein  contained,  the parties to the Existing  Collateral  Agreement
agree that the Existing Collateral  Agreement shall be and hereby is amended and
restated in its entirety and the parties hereto hereby agree as follows:

                                       92
<PAGE>

                            SECTION 1. DEFINED TERMS

               1.1  Definitions.  (a) Unless  otherwise  defined  herein,  terms
     defined in the Credit  Agreement  and used herein  shall have the  meanings
     given to them in the Credit  Agreement,  and the  following  terms are used
     herein as defined  in the New York UCC:  Accounts,  Certificated  Security,
     Chattel Paper, Equipment, Instruments and Inventory.

                  (b) The following terms shall have the following meanings:

                    "Agents":  collectively,  the  Administrative  Agent and the
          Documentation Agent.

                    "Agreement": this Amended and Restated Collateral Agreement,
          as the same may be amended,  supplemented  or otherwise  modified from
          time to time.

                    "Collateral": as defined in Section 3.

                    "Collateral Account":  any collateral account established by
          the Documentation Agent as provided in Section 6.1 or 6.4.

                    "Guarantors":  the  collective  reference to the Company and
          the Subsidiary Guarantors.

                    "Intercompany  Note": each note identified on Schedule 3 and
          any promissory note evidencing loans made by the Company or any of its
          Subsidiaries  (other than AcquisitionCo or any of its Subsidiaries) to
          AcquisitionCo  or any of its  Subsidiaries  from the  proceeds  of the
          Tranche A Loans and Tranche B Loans and any  portion of the  Revolving
          Loans and the European Loans used to finance the Acquisition.

                    "Investment  Property":  all  Pledged  Stock and all Pledged
          Notes.

                    "Issuers":   the  collective  reference  to  each  Grantor's
          Material  Subsidiaries  which  are  organized  under  the  laws of any
          jurisdiction  within the United States of America (other than any such
          Subsidiary  whose sole purpose is holding the Capital  Stock of one or
          more of the  Company's  Foreign  Subsidiaries)  and are required to be
          Grantors  hereunder  in  accordance  with  Section  13.9 of the Credit
          Agreement.

                    "New York UCC": the Uniform  Commercial Code as from time to
          time in effect in the State of New York.

                    "Obligations": as defined in the Credit Agreement.

                    "Pledged Notes":  all Intercompany  Notes at any time issued
          to any Grantor.

                                       93
<PAGE>

                    "Pledged  Stock":  the  shares of  Capital  Stock  listed on
          Schedule  2,  together  with any  other  shares,  stock  certificates,
          options or rights of any nature  whatsoever  in respect of the Capital
          Stock of any Issuer  that may be issued or granted to, or held by, any
          Grantor while this Agreement is in effect.

                    "Proceeds":  all  "proceeds"  as  such  term is  defined  in
          Section 9-306(1) of the New York UCC and, in any event, shall include,
          without limitation,  all dividends or other income from the Investment
          Property,  collections  thereon  or  distributions  or  payments  with
          respect thereto.

                    "Receivable":  any right to payment for goods sold or leased
          or for services rendered, whether or not such right is evidenced by an
          Instrument  or Chattel  Paper and whether or not it has been earned by
          performance (including, without limitation, any Account).

                    "Securities Act": the Securities Act of 1933, as amended.

                  1.2 Other  Definitional  Provisions.  (a) The words  "hereof,"
"herein", "hereto" and "hereunder" and words of similar import when used in this
Agreement  shall refer to this  Agreement  as a whole and not to any  particular
provision of this  Agreement,  and Section and Schedule  references  are to this
Agreement unless otherwise specified.

                  (b) The  meanings  given  to  terms  defined  herein  shall be
equally applicable to both the singular and plural forms of such terms.

                  (c)  Where  the  context  requires,   terms  relating  to  the
Collateral or any part thereof, when used in relation to a Grantor,  shall refer
to such Grantor's Collateral or the relevant part thereof.

                              SECTION 2. GUARANTEE

                  2.1  Guarantee.   (a)  The  Company  hereby   irrevocably  and
unconditionally  guarantees to the  Documentation  Agent, for the benefit of the
Agents  and the  Lenders  (and  their  affiliates  and  subsidiaries  which hold
Obligations),  the full and prompt  payment  when due  (whether  at  maturity or
earlier, by reason of acceleration or otherwise, and at all times thereafter) of
the  Obligations  of  the  Foreign  Borrowers  (including,  without  limitation,
interest  accruing  following the  commencement  of any insolvency or bankruptcy
case or proceeding or other similar case or proceeding in respect of any Foreign
Borrower,  at the applicable rate specified in the Credit Agreement,  whether or
not such interest is allowed as a claim in such case or proceeding).

                                       94
<PAGE>

                  (b) Each  Subsidiary  Guarantor  jointly and severally  hereby
irrevocably and unconditionally  guarantees to the Documentation  Agent, for the
benefit of the Agents and the Lenders  (and their  affiliates  and  subsidiaries
which  hold  Obligations),  the full and prompt  payment  when due  (whether  at
maturity or earlier,  by reason of acceleration  or otherwise,  and at all times
thereafter) of the Obligations (including, without limitation, interest accruing
following the commencement of any insolvency or bankruptcy case or proceeding or
other similar case or proceeding in respect of any Borrower,  at the  applicable
rate specified in the Credit Agreement,  whether or not such interest is allowed
as a claim in such case or proceeding).

                  (c)  Anything  herein or in any other  Credit  Document to the
contrary notwithstanding,  the maximum liability of each Guarantor hereunder and
under the other Credit  Documents  shall in no event exceed the amount which can
be guaranteed by such Guarantor under applicable federal and state laws relating
to the insolvency of debtors  (after giving effect to the right of  contribution
established in Section 2.2).

                  (d) Each Guarantor agrees that the Obligations may at any time
and from time to time  exceed  the  amount of the  liability  of such  Guarantor
hereunder  without  impairing  the  guarantee  contained  in this  Section  2 or
affecting the rights and remedies of either Agent or any Lender hereunder.

                  (e) The guarantee  contained in this Section 2 shall remain in
full force and effect until all the Obligations (including,  without limitation,
the  obligations  of each  Guarantor  under  this  Agreement)  shall  have  been
satisfied by payment in full, no Letter of Credit shall be  outstanding  and the
Commitments shall be terminated,  notwithstanding  that from time to time during
the term of the Credit Agreement the Borrowers may be free from any Obligations.

                  (f) No payment made by the Borrowers,  any of the  Guarantors,
any  other  guarantor  or any other  Person  or  received  or  collected  by the
Documentation  Agent,  the  Administrative  Agent or any Lender  from any of the
Borrowers,  any of the  Guarantors,  any other  guarantor or any other Person by
virtue  of  any  action  or  proceeding  or  any  set-off  or  appropriation  or
application  at any time or from time to time in  reduction  of or in payment of
the Obligations shall be deemed to modify,  reduce,  release or otherwise affect
the liability of any Guarantor  hereunder which shall,  notwithstanding any such
payment  (other  than any  payment  made by such  Guarantor  in  respect  of the
Obligations or any payment  received or collected from such Guarantor in respect
of the  Obligations),  remain  liable  for  the  Obligations  up to the  maximum
liability of such Guarantor hereunder until the Obligations are paid in full, no
Letter of Credit shall be outstanding and the Commitments are terminated.

                  2.2 Right of  Contribution.  Each Guarantor hereby agrees that
to the extent that a Guarantor shall have paid more than its proportionate share
of any payment  made  hereunder,  such  Guarantor  shall be entitled to seek and
receive  contribution  from and against any other Guarantor  hereunder which has
not paid its proportionate share of such payment and each other Guarantor agrees
that  it  will  contribute  its  proportionate  share  of  such  payment  to the
applicable Guarantor. Each Guarantor's right of contribution shall be subject to
the terms and  conditions  of Section  2.3. The  provisions  of this Section 2.2
shall in no respect limit the  obligations  and  liabilities of any Guarantor to
the Agents and the Lenders, and each Guarantor shall remain liable to the Agents
and the Lenders for the full amount guaranteed by such Guarantor hereunder.

                                       95
<PAGE>

                  2.3 No  Subrogation.  Notwithstanding  any payment made by any
Guarantor  hereunder or any set-off or  application of funds of any Guarantor by
the Agents or any Lender, no Guarantor shall be entitled to be subrogated to any
of the rights of the Agents or any Lender  against  the  Borrowers  or any other
Guarantor or any collateral security or guarantee or right of offset held by the
Agents or any Lender for the payment of the Obligations, nor shall any Guarantor
seek or be entitled to seek any contribution or reimbursement  from the Borrower
or any other Guarantor in respect of payments made by such Guarantor  hereunder,
until all  amounts  owing to the Agents  and the  Lenders  by the  Borrowers  on
account  of the  Obligations  are paid in full,  no Letter  of  Credit  shall be
outstanding and the  Commitments are terminated.  If any amount shall be paid to
any Guarantor on account of such subrogation  rights at any time when all of the
Obligations  shall not have been paid in full, such amount shall be held by such
Guarantor in trust for the Agents and the Lenders,  segregated  from other funds
of such  Guarantor,  and shall,  forthwith  upon receipt by such  Guarantor,  be
turned  over to the  Documentation  Agent in the  exact  form  received  by such
Guarantor  (duly  indorsed by such  Guarantor  to the  Documentation  Agent,  if
required), to be applied against the Obligations,  whether matured or unmatured,
in such order as the Documentation Agent may determine.

                  2.4 Amendments,  etc. with Respect to the Obligations.  To the
extent  permitted by  applicable  law,  each  Guarantor  shall remain  obligated
hereunder  notwithstanding  that,  without any reservation of rights against any
Guarantor and without notice to or further  assent by any Guarantor,  any demand
for  payment  of any of the  Obligations  made by an Agent or any  Lender may be
rescinded by such Agent or such Lender and any of the Obligations continued, and
the  Obligations,  or the  liability  of any other  Person  upon or for any part
thereof,  or any  collateral  security or guarantee  therefor or right of offset
with respect  thereto,  may, from time to time, in whole or in part, be renewed,
extended, amended, modified,  accelerated,  compromised,  waived, surrendered or
released  by an Agent or any  Lender,  and the  Credit  Agreement  and the other
Credit  Documents and any other  documents  executed and delivered in connection
therewith may be amended,  modified,  supplemented or terminated, in whole or in
part, as the Documentation Agent (or the Required Lenders or all Lenders, as the
case may be) may deem advisable from time to time, and any collateral  security,
guarantee or right of offset at any time held by any Agent or any Lender for the
payment  of the  Obligations  may be sold,  exchanged,  waived,  surrendered  or
released. Neither any Agent nor any Lender shall have any obligation to protect,
secure,  perfect or insure any Lien at any time held by it as  security  for the
Obligations  or for the  guarantee  contained  in this Section 2 or any property
subject thereto.

                                       96
<PAGE>

                  2.5  Guarantee  Absolute  and  Unconditional.  To  the  extent
permitted by  applicable  law, each  Guarantor  waives any and all notice of the
creation,  renewal, extension or accrual of any of the Obligations and notice of
or proof of reliance by any Agent or any Lender upon the guarantee  contained in
this Section 2 or acceptance  of the guarantee  contained in this Section 2; the
Obligations, and any of them, shall conclusively be deemed to have been created,
contracted or incurred,  or renewed,  extended,  amended or waived,  in reliance
upon the  guarantee  contained in this  Section 2; and all dealings  between the
Borrowers  and any of the  Guarantors,  on the one hand,  and the Agents and the
Lenders, on the other hand, likewise shall be conclusively presumed to have been
had or consummated  in reliance upon the guarantee  contained in this Section 2.
To the extent  permitted by applicable  law, each  Guarantor  waives  diligence,
presentment,  protest, demand for payment and notice of default or nonpayment to
or upon the Borrowers or any of the Guarantors with respect to the  Obligations.
Each  Guarantor  understands  and agrees that the  guarantee  contained  in this
Section  2 shall  be  construed  as a  continuing,  absolute  and  unconditional
guarantee of payment without regard to (a) the validity or enforceability of the
Credit  Agreement or any other Credit  Document,  any of the  Obligations or any
other collateral  security therefor or guarantee or right of offset with respect
thereto at any time or from time to time held by the Agents or any  Lender,  (b)
any  defense,  set-off  or  counterclaim  (other  than a defense  of  payment or
performance)  which  may at any  time  be  available  to or be  asserted  by the
Borrowers or any other Person against the Agents or any Lender, or (c) any other
circumstance whatsoever (with or without notice to or knowledge of the Borrowers
or such Guarantor) which  constitutes,  or might be construed to constitute,  an
equitable or legal  discharge of the Borrowers for the  Obligations,  or of such
Guarantor  under the guarantee  contained in this Section 2, in bankruptcy or in
any other instance.  When making any demand hereunder or otherwise  pursuing its
rights and remedies  hereunder  against any Guarantor,  the Agents or any Lender
may, but shall be under no obligation  to, make a similar demand on or otherwise
pursue such rights and remedies as it may have against the Borrowers,  any other
Guarantor  or any other Person or against any  collateral  security or guarantee
for the Obligations or any right of offset with respect thereto, and any failure
by the Agents or any Lender to make any such demand, to pursue such other rights
or remedies or to collect any payments from the Borrowers,  any other  Guarantor
or any other Person or to realize upon any such collateral security or guarantee
or to exercise any such right of offset,  or any release of the  Borrowers,  any
other Guarantor or any other Person or any such collateral  security,  guarantee
or right of  offset,  shall not  relieve  any  Guarantor  of any  obligation  or
liability  hereunder,  and shall not impair or affect  the rights and  remedies,
whether  express,  implied or available as a matter of law, of the Agents or any
Lender against any Guarantor. For the purposes hereof "demand" shall include the
commencement and continuance of any legal proceedings.

                  2.6 Reinstatement.  The guarantee  contained in this Section 2
shall continue to be effective, or be reinstated,  as the case may be, if at any
time payment,  or any part thereof,  of any of the  Obligations  is rescinded or
must  otherwise  be restored  or returned or repaid in a good faith  compromised
settlement  of a pending  avoidance  claim by any Agent or any  Lender  upon the
insolvency,  bankruptcy,  dissolution,  liquidation  or  reorganization  of  the
Borrowers  or any  Guarantor,  or upon or as a result  of the  appointment  of a
receiver,  intervenor or conservator  of, or trustee or similar officer for, the
Borrowers  or any  Guarantor  or  any  substantial  part  of  its  property,  or
otherwise, all as though such payments had not been made.

                  2.7 Payments.  Each Guarantor hereby  guarantees that payments
hereunder  will  be  paid  to  the   Documentation   Agent  without  set-off  or
counterclaim in Dollars at the office of the Documentation  Agent located at 399
Park Avenue, New York, New York 10022.

                      SECTION 3. GRANT OF SECURITY INTEREST

                  3.1 Grant of Security  Interest.  Each Grantor  hereby assigns
and transfers to the Documentation Agent, and hereby grants to the Documentation
Agent,  for the  ratable  benefit  of the  Agents  and the  Lenders  (and  their
affiliates and subsidiaries which hold Obligations), a security interest in, all
of the following  property now owned or at any time  hereafter  acquired by such
Grantor  or in  which  such  Grantor  now has or at any time in the  future  may
acquire  any right,  title or  interest  (collectively,  the  "Collateral"),  as
collateral security for the prompt and complete payment and performance when due
(whether at the stated maturity, by acceleration or otherwise) of such Grantor's
Obligations:

                                       97
<PAGE>

                  (a)  all Receivables;

                  (b)  all Equipment;

                  (c)  all Inventory;

                  (d)  all Investment Property;

                  (e)  all books and records pertaining to the Collateral; and

                  (f) to the extent not  otherwise  included,  all  Proceeds and
products  of any  and  all of the  foregoing  and all  collateral  security  and
guarantees given by any Person with respect to any of the foregoing.

                  Notwithstanding the foregoing, to the extent that the grant of
the  security  interest  specified  in this  Section 3.1 would  otherwise  cover
Collateral of the Engineered  Products Division (the "Division") of the Company,
such grant shall not become effective unless and until by September 30, 2000 the
Company  shall not have  completed  the sale of the Division  for  consideration
which shall  include a cash  portion in an amount not less than $150  million of
Net Proceeds and satisfied the other requirements of Section 2.1(i) of the Third
Amendment   to  the   Credit   Agreement.   Furthermore,   the   covenants   and
representations  and  warranties  contained in this Agreement that relate to any
Collateral described in the preceding sentence shall not become effective unless
and until the  security  interest in such assets  created  hereby  shall  become
effective pursuant to such preceding sentence.

                  Notwithstanding  anything to the contrary herein,  neither the
grant of the security  interest  specified in this Section 3.1 nor any reference
to Collateral contained in this Agreement shall include any Equipment covered by
the terms  and  provisions  of the  Lease  Agreement.  For the  purposes  of the
preceding  sentence,  Equipment shall have the meaning given to such term in the
Lease Agreement.

                    SECTION 4. REPRESENTATIONS AND WARRANTIES

                  To induce the Agents and the  Lenders to enter into the Credit
Agreement  and to induce  the  Lenders to make their  respective  extensions  of
credit to the Borrowers thereunder,  each Grantor hereby represents and warrants
to the Agents and each Lender that:

                                       98
<PAGE>

                  4.1 Title;  No Other Liens.  Except for the security  interest
granted to the Documentation Agent for the ratable benefit of the Agents and the
Lenders (and their affiliates and subsidiaries which hold Obligations)  pursuant
to this  Agreement and the other Liens  permitted to exist on the  Collateral by
the Credit Agreement, such Grantor owns each item of the Collateral attributable
to such  Grantor  free and clear of any and all Liens or  claims of  others.  No
financing  statement or other  public  notice with respect to all or any part of
the Collateral is on file or of record in any public office, except such as have
been filed in favor of the  Documentation  Agent, for the ratable benefit of the
Agents  and the  Lenders  (and  their  affiliates  and  subsidiaries  which hold
Obligations),  pursuant  to this  Agreement  or as are  permitted  by the Credit
Agreement.

                  4.2 Perfected First Priority  Liens.  Except in respect of (i)
any Instruments, Certificated Securities, Chattel Paper or letters of credit not
delivered to the  Documentation  Agent  pursuant to Section 5.1 or (ii) Excluded
Equipment and Excluded  Inventory as defined in Section 4.4 and (iii) subject to
compliance  with the Federal  Assignment of Claims Act of 1940,  as amended,  or
other similar  state  statutes as  applicable,  the security  interests  granted
pursuant to this  Agreement (a)  constitute,  or upon  completion of the filings
specified on Schedule 6 (which,  in the case of all filings and other  documents
referred to on said Schedule,  have been delivered to the Documentation Agent in
completed and duly  executed  form) will  constitute  valid  perfected  security
interests in all of the Collateral in favor of the Documentation  Agent, for the
ratable  benefit  of the  Agents  and the  Lenders  (and  their  affiliates  and
subsidiaries which hold Obligations),  as collateral security for such Grantor's
Obligations,  enforceable  in  accordance  with the  terms  hereof  against  all
creditors of such Grantor and any Persons  purporting to purchase any Collateral
from such  Grantor  and (b) are prior to all other  Liens on the  Collateral  in
existence  on the date  hereof  except for other Liens  permitted  by the Credit
Agreement  which have priority over the Liens on the  Collateral by operation of
law.

                  4.3 Chief Executive Office. On the date hereof, such Grantor's
jurisdiction of organization  and the location of such Grantor's chief executive
office or sole place of business are specified on Schedule 4.

                  4.4 Inventory and Equipment. On the date hereof, the Inventory
and the  Equipment  of  such  Grantor  (other  than  (i)  Equipment  located  at
residences  of sales  employees of such Grantor (the  aggregate  amount of which
shall not exceed $1  million)  (the  "Excluded  Equipment")  and (ii)  Inventory
delivered on consignment  to third parties (the aggregate  amount of which shall
not exceed $5 million) (the  "Excluded  Inventory")  and (iii) mobile goods) are
kept at the locations listed on Schedule 5.

                  4.5  Investment  Property.  (a) The  shares of  Pledged  Stock
pledged by such  Grantor  hereunder  constitute  all the issued and  outstanding
shares of all classes of the Capital Stock of each Issuer owned by such Grantor.

                  (b) All the  shares of the  Pledged  Stock  have been duly and
validly issued and are fully paid and nonassessable.

                  (c) Each of the Pledged Notes constitutes the legal, valid and
binding  obligation  of  the  obligor  with  respect  thereto,   enforceable  in
accordance  with its terms,  subject to the effects of  bankruptcy,  insolvency,
fraudulent  conveyance,  reorganization,   moratorium  and  other  similar  laws
relating  to  or  affecting  creditors'  rights  generally,   general  equitable
principles  (whether  considered  in a  proceeding  in  equity or at law) and an
implied covenant of good faith and fair dealing.

                                       99
<PAGE>

                  (d) Such  Grantor is the record and  beneficial  owner of, and
has  good and  marketable  title  to,  the  Investment  Property  pledged  by it
hereunder,  free of any and all Liens or  options in favor of, or claims of, any
other Person, except the security interest created by this Agreement.

                  (e) The undated  stock powers  delivered to the  Documentation
Agent are duly  executed and give the  Documentation  Agent the  authority  they
purport to confer.

                  4.6  Receivables.  (a) No amount payable to such Grantor under
or in connection  with any  Receivable is evidenced by any Instrument or Chattel
Paper which has not been delivered to the  Documentation  Agent,  except for any
such Instruments or Chattel Paper that have face amounts less than $2 million in
the aggregate at any given time.

                  (b) None of the obligors on any  Receivables is a Governmental
Authority  under  the laws of the  United  States or any  jurisdiction  therein,
except for any such  Receivables  that do not exceed $2 million in the aggregate
at any given time.

                  (c) The  amounts  represented  by such  Grantor to the Lenders
from time to time as owing to such Grantor in respect of the Receivables will at
such times be accurate.

                              SECTION 5. COVENANTS

                  Each  Grantor  covenants  and  agrees  with the Agents and the
Lenders that,  from and after the date of this Agreement  until the  Obligations
shall have been paid in full, no Letter of Credit shall be  outstanding  and the
Commitments shall have terminated:

                  5.1  Delivery  of  Instruments,  Certificated  Securities  and
Chattel  Paper.  If any amounts  payable under or in connection  with any of the
Collateral  shall  be or  become  evidenced  by  any  Instruments,  Certificated
Securities or Chattel  Paper,  such  Instruments,  Certificated  Securities  and
Chattel Paper shall be immediately  delivered to the  Documentation  Agent, duly
indorsed in a manner reasonably  satisfactory to the Documentation  Agent, to be
held as Collateral pursuant to this Agreement.  Notwithstanding  anything to the
contrary herein,  the preceding  sentence of this Section 5.1 shall not apply to
(a) Instruments, Certificated Securities or Chattel Paper that have face amounts
less than $2 million in the  aggregate  at any given time,  except as  otherwise
required  pursuant to Section 5.7 below or (b) letters of credit  supporting any
payments with respect to any  Collateral;  provided  that, at any time after the
occurrence and during the continuance of an Event of Default,  at the request of
the  Documentation  Agent, such Instruments,  Certificated  Securities,  Chattel
Paper and any  letters of credit  supporting  any  payment  with  respect to any
Collateral  shall be  immediately  delivered to the  Documentation  Agent,  duly
indorsed in a manner reasonably  satisfactory to the Documentation  Agent, to be
held as Collateral pursuant to this Agreement.

                                      100
<PAGE>

                  5.2 Maintenance of Insurance.  (a) Such Grantor will maintain,
with financially sound and reputable companies,  insurance policies (i) insuring
the  Inventory  and Equipment  against loss by fire,  explosion,  theft and such
other casualties as may be reasonably  satisfactory to the  Documentation  Agent
and (ii) insuring such Grantor,  the Documentation Agent and the Lenders against
liability for personal injury and property damage relating to such Inventory and
Equipment, such policies to be in such form and amounts and having such coverage
as may be reasonably satisfactory to the Documentation Agent and the Lenders.

                  (b) All such insurance shall (i) provide that no cancellation,
material  reduction in amount or material  change in coverage  thereof  shall be
effective  until at least 30 days after  receipt by the  Documentation  Agent of
written notice thereof,  (ii) name the  Documentation  Agent as insured party or
loss payee, (iii) if reasonably  requested by the Documentation Agent, include a
breach of  warranty  clause  and (iv) be  reasonably  satisfactory  in all other
respects to the Documentation Agent.

                  (c)  At  any  time  after  the   occurrence   and  during  the
continuance of an Event of Default,  at the request of the Documentation  Agent,
the Company shall deliver to the  Documentation  Agent and the Lenders a written
report  of  a  reputable   insurance  broker  with  respect  to  such  insurance
substantially  concurrently  with each delivery of the Company's  audited annual
financial  statements and such supplemental  reports with respect thereto as the
Documentation Agent may from time to time reasonably request.

                  5.3  Payment  of  Obligations.   Such  Grantor  will  pay  and
discharge  or  otherwise  satisfy at or before  maturity  or before  they become
delinquent,  as the case may be, all taxes, assessments and governmental charges
or levies  imposed  upon the  Collateral  or in  respect  of  income or  profits
therefrom,  as well as all  claims of any kind  against  or with  respect to the
Collateral,  except  that no such  charge need be paid if the amount or validity
thereof is currently being  contested in good faith by appropriate  proceedings,
reserves in conformity  with GAAP with respect thereto have been provided on the
books of such Grantor and such  proceedings  could not reasonably be expected to
result in the sale, forfeiture or loss of any material portion of the Collateral
or any interest therein.

                    5.4  Maintenance  of Perfected  Security  Interest;  Further
Documentation.

                  (a) Such Grantor shall maintain the security  interest created
by this Agreement as a perfected  security interest having at least the priority
described in Section 4.2 and shall  defend such  security  interest  against the
claims and demands of all Persons whomsoever.

                  (b) Such Grantor will furnish to the  Documentation  Agent and
the Lenders from time to time statements and schedules  further  identifying and
describing  the  Collateral of such Grantor and such other reports in connection
therewith as the Documentation Agent may reasonably  request,  all in reasonable
detail.

                                      101
<PAGE>

                  (c) At any  time  and from  time to  time,  upon  the  written
request of the  Documentation  Agent,  and at the sole expense of such  Grantor,
such Grantor will promptly and duly execute and deliver, and have recorded, such
further  instruments  and  documents  and  take  such  further  actions  as  the
Documentation  Agent may  reasonably  request  for the purpose of  obtaining  or
preserving  the full  benefits  of this  Agreement  and of the rights and powers
herein  granted,  including,  without  limitation,  (i) filing any  financing or
continuation  statements  under the Uniform  Commercial  Code (or other  similar
laws) in effect in any  jurisdiction  with  respect  to the  security  interests
created hereby and (ii) in the case of Investment Property pledged hereunder and
any other  relevant  Collateral,  taking  any  actions  necessary  to enable the
Documentation  Agent to obtain  "control"  (within the meaning of the applicable
Uniform Commercial Code) with respect thereto.

                  5.5 Changes in  Locations,  Name,  etc. Such Grantor will not,
except  upon 10 days'  prior  written  notice  to the  Documentation  Agent  and
delivery to the  Documentation  Agent of (a) all additional  executed  financing
statements and other documents  reasonably  requested by the Documentation Agent
to maintain the  validity,  perfection  and  priority of the security  interests
provided for herein and (b) if  applicable,  a written  supplement to Schedule 5
showing  any  additional  location  at  which  Inventory  (other  than  Excluded
Inventory) or Equipment shall be kept:

                  (i)  permit  any  of  the   Inventory   (other  than  Excluded
         Inventory)  or  Equipment  to be kept at a  location  other  than those
         listed on Schedule 5;

                  (ii) change its  jurisdiction  of organization or the location
         of its chief  executive  office  or sole  place of  business  from that
         referred to in Section 4.3, or

                  (iii) change its name, identity or corporate structure to such
         an extent that any financing statement filed by the Documentation Agent
         in connection with this Agreement would become misleading.

                  5.6 Notices.  Such Grantor will advise the Documentation Agent
and the Lenders promptly, in reasonable detail, of:

                  (a) any Lien (other than security  interests created hereby or
Liens permitted under the Credit Agreement) on any of the Collateral which would
materially  adversely affect the ability of the Documentation  Agent to exercise
any of its remedies hereunder; and

                  (b)  of  the   occurrence  of  any  other  event  which  could
reasonably  be  expected  to have a  material  adverse  effect  on the  security
interests created hereby.

                                      102
<PAGE>

                  5.7  Investment  Property.  (a) If such  Grantor  shall become
entitled to receive or shall receive any stock certificate  (including,  without
limitation,  any certificate  representing a stock dividend or a distribution in
connection  with any  reclassification,  increase or reduction of capital or any
certificate issued in connection with any  reorganization),  option or rights in
respect  of the  Capital  Stock  of any  Issuer,  whether  in  addition  to,  in
substitution  of, as a  conversion  of, or in  exchange  for,  any shares of the
Pledged Stock,  or otherwise in respect  thereof,  such Grantor shall accept the
same as the agent of the Documentation  Agent and the Lenders,  hold the same in
trust for the Documentation Agent and the Lenders and deliver the same forthwith
to the  Documentation  Agent in the exact form  received,  duly indorsed by such
Grantor to the Documentation Agent, if required,  together with an undated stock
power covering such certificate duly executed in blank by such Grantor and with,
if the Documentation Agent so requests,  signature guaranteed, to be held by the
Documentation  Agent,  subject to the terms  hereof,  as  additional  collateral
security for the Obligations. Any sums paid upon or in respect of the Investment
Property  pledged  hereunder  upon the  liquidation or dissolution of any Issuer
shall be paid  over to the  Documentation  Agent to be held by it  hereunder  as
additional collateral security for the Obligations, and in case any distribution
of capital  shall be made on or in respect of the  Investment  Property  pledged
hereunder  or any  property  shall be  distributed  upon or with  respect to the
Investment  Property  pledged  hereunder  pursuant  to the  recapitalization  or
reclassification  of the capital of any Issuer or pursuant to the reorganization
thereof,  the  property so  distributed  shall,  unless  otherwise  subject to a
perfected security interest in favor of the Documentation Agent, be delivered to
the  Documentation  Agent to be held by it  hereunder as  additional  collateral
security  for the  Obligations.  If any  sums of money  or  property  so paid or
distributed in respect of the Investment  Property  pledged  hereunder  shall be
received by such Grantor,  such Grantor  shall,  until such money or property is
paid or delivered  to the  Documentation  Agent,  hold such money or property in
trust  for  the  Lenders,  segregated  from  other  funds  of such  Grantor,  as
additional collateral security for the Obligations.

                  (b) Without  the prior  written  consent of the  Documentation
Agent,  such  Grantor  will not (i) vote to enable,  or take any other action to
permit,  any Issuer to issue any stock or other equity  securities of any nature
or to issue any  other  securities  convertible  into or  granting  the right to
purchase or exchange for any stock or other equity  securities  of any nature of
any Issuer, (ii) sell, assign,  transfer,  exchange, or otherwise dispose of, or
grant any option with respect to, the Investment  Property pledged  hereunder or
Proceeds  thereof (except pursuant to a transaction  expressly  permitted by the
Credit Agreement),  (iii) create, incur or permit to exist any Lien or option in
favor of, or any claim of any Person  with  respect  to,  any of the  Investment
Property pledged hereunder or Proceeds thereof, or any interest therein,  except
for the  security  interests  created by this  Agreement  or (iv) enter into any
agreement or undertaking restricting the right or ability of such Grantor or the
Documentation  Agent to sell, assign or transfer any of the Investment  Property
pledged hereunder or Proceeds thereof.

                  (c) In the  case of each  Grantor  which  is an  Issuer,  such
Issuer agrees that (i) it will be bound by the terms of this Agreement  relating
to the Investment  Property issued by it and will comply with such terms insofar
as such terms are applicable to it, (ii) it will notify the Documentation  Agent
promptly in writing of the occurrence of any of the events  described in Section
5.7(a) with respect to the Investment  Property issued by it and (iii) the terms
of Sections 6.3(c) and 6.7 shall apply to it, mutatis mutandis,  with respect to
all actions  that may be  required of it pursuant to Section  6.3(c) or 6.7 with
respect to the Investment Property issued by it.

                  5.8  Receivables.  (a) Other  than in the  ordinary  course of
business consistent with its past practice,  such Grantor will not (i) grant any
extension of the time of payment of any  Receivable,  (ii)  compromise or settle
any Receivable for less than the full amount thereof,  (iii) release,  wholly or
partially,  any Person liable for the payment of any Receivable,  (iv) allow any
credit or discount  whatsoever  on any  Receivable  or (v) amend,  supplement or
modify any  Receivable  in any  manner  that  could  adversely  affect the value
thereof.

                  (b) Such  Grantor will  deliver to the  Documentation  Agent a
copy of each material demand,  notice or document  received by it that questions
or calls  into  doubt  the  validity  or  enforceability  of more than 5% of the
aggregate amount of the then outstanding Receivables.

                                      103
<PAGE>

                         SECTION 6. REMEDIAL PROVISIONS

                  6.1  Certain  Matters   Relating  to   Receivables.   (a)  The
Documentation  Agent shall have the right at any time after the  occurrence  and
during the continuance of an Event of Default to make test  verifications of the
Receivables in any reasonable  manner and through any reasonable  medium that it
reasonably  considers  advisable,  and  each  Grantor  shall  furnish  all  such
assistance and information as the Documentation  Agent may reasonably require in
connection with such test verifications.

                  (b) The Documentation  Agent hereby authorizes each Grantor to
collect such Grantor's  Receivables and the  Documentation  Agent may curtail or
terminate  said  authority  at any time  after the  occurrence  and  during  the
continuance of an Event of Default.  If required by the  Documentation  Agent at
any time after the occurrence and during the continuance of an Event of Default,
any  payments  of  Receivables,  when  collected  by any  Grantor,  (i) shall be
forthwith  (and,  in any event,  within two  Business  Days)  deposited  by such
Grantor  in the exact  form  received,  duly  indorsed  by such  Grantor  to the
Documentation  Agent if required,  in a Collateral  Account maintained under the
sole dominion and control of the Documentation  Agent,  subject to withdrawal by
the  Documentation  Agent for the  account of the  Lenders  only as  provided in
Section  6.5,  and (ii) until so turned  over,  shall be held by such Grantor in
trust for the Documentation  Agent and the Lenders,  segregated from other funds
of such  Grantor.  Each  such  deposit  of  Proceeds  of  Receivables  shall  be
accompanied by a report  identifying in reasonable  detail the nature and source
of the payments included in the deposit.

                  6.2 Communications with Obligors;  Grantors Remain Liable. (a)
The Documentation Agent in its own name or in the name of others may at any time
after  the  occurrence  and  during  the  continuance  of an  Event  of  Default
communicate  with  obligors  under the  Receivables  to verify  with them to the
Documentation  Agent's  satisfaction  the  existence,  amount  and  terms of any
Receivables.

                  (b) Upon the  request  of the  Documentation  Agent and at any
time after the  occurrence  and during the  continuance  of an Event of Default,
each Grantor shall notify obligors on the Receivables  that the Receivables have
been assigned to the Documentation  Agent for the ratable benefit of the Lenders
and that payments in respect thereof shall be made directly to the Documentation
Agent.

                                      104
<PAGE>

                  (c)  Anything  herein to the  contrary  notwithstanding,  each
Grantor shall remain liable under each of the Receivables to observe and perform
all  the  conditions  and  obligations  to  be  observed  and  performed  by  it
thereunder,  all in  accordance  with the  terms of any  agreement  giving  rise
thereto.  Neither  the  Documentation  Agent  nor  any  Lender  shall  have  any
obligation  or liability  under any  Receivable  (or any  agreement  giving rise
thereto)  by reason of or arising  out of this  Agreement  or the receipt by the
Documentation Agent or any Lender of any payment relating thereto, nor shall the
Administrative  Agent or any Lender be obligated in any manner to perform any of
the  obligations  of any Grantor  under or pursuant  to any  Receivable  (or any
agreement giving rise thereto),  to make any payment,  to make any inquiry as to
the  nature  or the  sufficiency  of  any  payment  received  by it or as to the
sufficiency of any performance by any party  thereunder,  to present or file any
claim,  to take any action to enforce any  performance or to collect the payment
of any amounts which may have been assigned to it or to which it may be entitled
at any time or times.

                  6.3  Pledged  Stock.  (a)  Unless  an Event of  Default  under
Section 15(a) of the Credit  Agreement shall have occurred and be continuing and
the  Documentation  Agent shall have given notice to the relevant Grantor of the
Documentation  Agent's intent to exercise its  corresponding  rights pursuant to
Section  6.3(b),  each Grantor shall be permitted to receive all cash  dividends
paid in respect of the Pledged Stock and all payments made in respect of Pledged
Notes, in each case paid in the normal course of business of the relevant Issuer
and consistent  with past  practice,  to the extent not prohibited by the Credit
Agreement,  and to exercise all voting and corporate  rights with respect to the
Investment Property pledged hereunder;  provided, however, that no vote shall be
cast or  corporate  right  exercised  or  other  action  taken  which  would  be
inconsistent  with or result in any  violation  of any  provision  of the Credit
Agreement, this Agreement or any other Credit Document.

                  (b) If (x) either (A) an Event of Default  under Section 15(a)
of the Credit  Agreement shall occur and be continuing or (B) the Obligations of
any Borrower are accelerated and (y) the  Documentation  Agent shall give notice
of its intent to exercise such rights to the relevant Grantor or Grantors:

                  (i) the  Documentation  Agent  shall have the right to receive
         any and all cash dividends,  payments or other Proceeds paid in respect
         of the  Investment  Property  pledged  hereunder  and make  application
         thereof to the Obligations in such order as the Documentation Agent may
         determine; and

                  (ii) any or all of the Investment  Property pledged  hereunder
         shall  be  registered  in the  name of the  Documentation  Agent or its
         nominee,  and the  Documentation  Agent or its nominee  may  thereafter
         exercise  (x)  following  written  notice to the  relevant  Grantor  or
         Grantors,  all voting,  corporate  and other rights  pertaining to such
         Investment  Property at any  meeting of  shareholders  of the  relevant
         Issuer  or  Issuers  or  otherwise  and  (y)  any  and  all  rights  of
         conversion,  exchange and subscription and any other rights, privileges
         or options  pertaining  to such  Investment  Property as if it were the
         absolute owner thereof  (including,  without  limitation,  the right to
         exchange  at its  discretion  any  and all of the  Investment  Property
         pledged  hereunder  upon  the  merger,  consolidation,  reorganization,
         recapitalization or other fundamental change in the corporate structure
         of any Issuer, or upon the exercise by any Grantor or the Documentation
         Agent of any right,  privilege or option  pertaining to such Investment
         Property, and in connection therewith, the right to deposit and deliver
         any and all of the  Investment  Property  pledged  hereunder  with  any
         committee,  depositary,  transfer agent,  registrar or other designated
         agency upon such terms and  conditions as the  Documentation  Agent may
         determine);

all without  liability except to account for property  actually  received by it,
but the  Documentation  Agent shall have no duty to any Grantor to exercise  any
such right,  privilege or option and shall not be responsible for any failure to
do so or delay in so doing.

                                      105
<PAGE>

                  (c) Each Grantor  hereby  authorizes and instructs each Issuer
of any Investment  Property pledged by such Grantor hereunder to (i) comply with
any instruction  received by it from the Documentation Agent in writing that (x)
states  that an Event of  Default  has  occurred  and is  continuing  and (y) is
otherwise in accordance with the terms of this  Agreement,  without any other or
further instructions from such Grantor, and each Grantor agrees that each Issuer
shall be fully protected in so complying,  and (ii) unless  otherwise  expressly
permitted  hereby,  pay any  dividends  or other  payments  with  respect to the
Investment Property pledged hereunder directly to the Documentation Agent.

                  6.4 Proceeds to be Turned Over To  Documentation  Agent. If an
Event of Default under Section 15(a) of the Credit  Agreement shall occur and be
continuing and the Administrative  Agent shall have so requested in writing, all
Proceeds received by any Grantor  consisting of cash, checks and other near-cash
items shall be held by such Grantor in trust for the Documentation Agent and the
Lenders,  segregated from other funds of such Grantor, and shall, forthwith upon
receipt by such Grantor,  be turned over to the Documentation Agent in the exact
form  received  by  such  Grantor   (duly   indorsed  by  such  Grantor  to  the
Documentation  Agent, if required).  All Proceeds  received by the Documentation
Agent hereunder shall be held by the Documentation Agent in a Collateral Account
maintained  under its sole dominion and control.  All Proceeds while held by the
Documentation Agent in a Collateral Account (or by such Grantor in trust for the
Documentation  Agent and the Lenders)  shall  continue to be held as  collateral
security for all the Obligations and shall not constitute  payment thereof until
applied as provided in Section 6.5.

                  6.5  Application  of  Proceeds.  At such  intervals  as may be
agreed  upon by the  Grantor  and the  Documentation  Agent,  or, if an Event of
Default shall have occurred and be continuing,  at any time at the Documentation
Agent's election,  the Documentation Agent may apply all or any part of Proceeds
held in any  Collateral  Account in payment of the  Obligations in such order as
the  Documentation  Agent  may  elect,  and any  part of such  funds  which  the
Documentation  Agent elects not so to apply and deems not required as collateral
security  for the  Obligations  shall  be  paid  over  from  time to time by the
Documentation Agent to the Grantors or to whomsoever may be lawfully entitled to
receive the same. Any balance of such Proceeds  remaining  after the Obligations
shall have been paid in full, no Letters of Credit shall be outstanding  and the
Commitments  shall  have  terminated  shall be paid over to the  Grantors  or to
whomsoever may be lawfully entitled to receive the same.

                                      106
<PAGE>

                  6.6 Code and  Other  Remedies.  If an Event of  Default  shall
occur and be continuing,  the Documentation Agent, on behalf of the Lenders, may
exercise,  in addition to all other rights and remedies  granted to them in this
Agreement  and in any other  instrument  or agreement  securing,  evidencing  or
relating to the  Obligations,  all rights and remedies of a secured  party under
the New York UCC or any other applicable law. Without limiting the generality of
the foregoing, to the extent permitted by applicable law, if an Event of Default
under Section 15(a) of the Credit Agreement shall occur and be continuing or the
Obligations  of any  Borrower  shall have been  accelerated,  the  Documentation
Agent,  without  demand of performance  or other demand,  presentment,  protest,
advertisement  or notice of any kind (except any notice required by law referred
to below) to or upon any Grantor or any other Person to the extent  permitted by
applicable  law (all and each of which  demands,  defenses,  advertisements  and
notices  are  hereby  waived),  may in  such  circumstances  forthwith  collect,
receive,  appropriate  and realize  upon the  Collateral,  or any part  thereof,
and/or may forthwith sell, lease, assign, give option or options to purchase, or
otherwise dispose of and deliver the Collateral or any part thereof (or contract
to do any of the foregoing), in one or more parcels at public or private sale or
sales, at any exchange,  broker's board or office of the Documentation  Agent or
any Lender or elsewhere  upon such terms and conditions as it may deem advisable
and at such  prices as it may deem  best,  for cash or on  credit or for  future
delivery without  assumption of any credit risk. The Documentation  Agent or any
Lender  shall have the right upon any such  public  sale or sales,  and,  to the
extent  permitted by law,  upon any such private sale or sales,  to purchase the
whole or any part of the  Collateral  so sold,  free of any  right or  equity of
redemption in any Grantor,  which right or equity is hereby waived and released.
Each Grantor further agrees, at the Documentation  Agent's request,  to assemble
the Collateral and make it available to the Documentation  Agent at places which
the  Documentation  Agent shall  reasonably  select,  whether at such  Grantor's
premises or elsewhere.  The Documentation  Agent shall apply the net proceeds of
any action taken by it pursuant to this Section,  after deducting all reasonable
costs and expenses of every kind incurred in connection  therewith or incidental
to the care or  safekeeping  of any of the  Collateral or in any way relating to
the  Collateral  or the  rights  of the  Documentation  Agent  and  the  Lenders
hereunder,  including,  without  limitation,   reasonable  attorneys'  fees  and
disbursements,  to the payment in whole or in part of the  Obligations,  in such
order as the Documentation  Agent may elect, and only after such application and
after the payment by the Documentation Agent of any other amount required by any
provision of law, including, without limitation,  Section 9-504(1)(c) of the New
York UCC, need the Documentation  Agent account for the surplus,  if any, to any
Grantor.  To the extent  permitted by applicable  law,  each Grantor  waives all
claims,  damages and demands it may acquire against the  Documentation  Agent or
any Lender arising out of the exercise by them of any rights  hereunder.  If any
notice of a proposed sale or other  disposition of Collateral  shall be required
by law, such notice shall be deemed  reasonable  and proper if given at least 10
Business Days before such sale or other disposition.

                  6.7 Registration  Rights. (a) If the Documentation Agent shall
determine to exercise its right to sell any or all of the Pledged Stock pursuant
to Section 6.6, and if in the opinion of the Documentation Agent it is necessary
or advisable  to have the Pledged  Stock,  or that  portion  thereof to be sold,
registered under the provisions of the Securities Act, the relevant Grantor will
cause the Issuer thereof to (i) execute and deliver, and cause the directors and
officers  of such  Issuer to  execute  and  deliver,  all such  instruments  and
documents,  and do or cause to be done all  such  other  acts as may be,  in the
opinion of the  Documentation  Agent,  necessary  or  advisable  to register the
Pledged Stock, or that portion  thereof to be sold,  under the provisions of the
Securities  Act, (ii) use its best efforts to cause the  registration  statement
relating thereto to become effective and to remain effective for a period of one
year from the date of the first public  offering of the Pledged  Stock,  or that
portion thereof to be sold, and (iii) make all amendments  thereto and/or to the
related  prospectus  which,  in the  opinion  of the  Documentation  Agent,  are
necessary  or  advisable,  all  in  conformity  with  the  requirements  of  the
Securities  Act and the rules and  regulations  of the  Securities  and Exchange
Commission  applicable  thereto.  Each  Grantor  agrees to cause such  Issuer to
comply with the  provisions of the  securities or "Blue Sky" laws of any and all
jurisdictions  which  the  Documentation  Agent  shall  designate  and  to  make
available to its security holders, as soon as practicable, an earnings statement
(which need not be audited)  which will satisfy the  provisions of Section 11(a)
of the Securities Act.

                                      107
<PAGE>

                  (b) Each Grantor  recognizes that the Documentation  Agent may
be unable to effect a public sale of any or all the Pledged Stock,  by reason of
certain  prohibitions  contained  in the  Securities  Act and  applicable  state
securities  laws or  otherwise,  and may be  compelled  to resort to one or more
private sales thereof to a restricted  group of purchasers which will be obliged
to agree,  among other things,  to acquire such securities for their own account
for investment and not with a view to the  distribution or resale thereof.  Each
Grantor  acknowledges and agrees that any such private sale may result in prices
and  other  terms  less  favorable  than if such  sale  were a public  sale and,
notwithstanding  such circumstances,  agrees that any such private sale shall be
deemed to have been made in a commercially  reasonable manner. The Documentation
Agent shall be under no  obligation  to delay a sale of any of the Pledged Stock
for the period of time  necessary to permit the Issuer  thereof to register such
securities for public sale under the Securities Act, or under  applicable  state
securities laws, even if such Issuer would agree to do so.

                  (c) Each Grantor agrees to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales of
all or any  portion of the Pledged  Stock  pursuant  to this  Section  valid and
binding and in compliance with any and all other applicable Requirements of Law.
Each Grantor  further agrees that a breach of any of the covenants  contained in
this Section 6.7 will cause irreparable  injury to the  Documentation  Agent and
the  Lenders,  that the  Documentation  Agent and the  Lenders  have no adequate
remedy at law in respect of such  breach and,  as a  consequence,  that each and
every  covenant  contained in this  Section  shall be  specifically  enforceable
against such  Grantor,  and such Grantor  hereby waives and agrees not to assert
any defenses against an action for specific performance of such covenants except
for a defense that no Event of Default has occurred under the Credit Agreement.

                  6.8 Waiver; Deficiency.  Each Grantor waives and agrees not to
assert any rights or privileges  against the  Documentation  Agent or any Lender
which it may acquire under Section 9-112 of the New York UCC. Each Grantor shall
remain  liable  for  any  deficiency  if the  proceeds  of  any  sale  or  other
disposition of the Collateral are insufficient to pay its Obligations subject to
Section  2.1(c)  and the  reasonable  fees and  disbursements  of any  attorneys
employed by any Agent or any Lender to collect such deficiency.

                  6.9 Notice to Grantor  of Sale.  Unless any of the  Collateral
threatens  to  decline  speedily  in value or is or  becomes of a type sold on a
recognized  market,  the  Documentation  Agent will give the Grantor  reasonable
notice of the time and place of any public  sale  thereof,  or of the time after
which any private sale or other intended  disposition is to be made. Any sale of
the Collateral  conducted in conformity with reasonable  commercial practices of
banks,  commercial  finance  companies,  insurance  companies or other financial
institutions  disposing of property similar to the Collateral shall be deemed to
be  commercially  reasonable.  Notwithstanding  any  provision  to the  contrary
contained herein,  the Grantor agrees that any requirements of reasonable notice
shall be met if such  notice is  received  by the Grantor as provided in Section
8.2  below  at least  ten  (10)  Business  Days  before  the time of the sale or
disposition;  provided,  however,  that  the  Documentation  Agent  may give any
shorter notice that is  commercially  reasonable  under the  circumstances.  Any
other requirement of notice,  demand or advertisement for sale is waived, to the
extent permitted by law.

                                      108
<PAGE>

                  6.10 Other  Sales.  In view of the fact that federal and state
securities laws may impose certain restrictions on the method by which a sale of
the Collateral may be effected after the occurrence and during the  continuation
of an Event of Default  set forth in Section  15(a) of the Credit  Agreement  or
upon  acceleration of the Obligations of any Borrower,  each Grantor agrees that
upon the  occurrence  and during the  continuation  of an Event of Default,  the
Documentation  Agent may, from time to time,  attempt to sell all or any part of
the  Collateral  by means of a private  placement  restricting  the  bidders and
prospective  purchasers to those who are qualified and will  represent and agree
that they are  purchasing for investment  only and not for  distribution.  In so
doing, the Documentation Agent may solicit offers to buy the Collateral,  or any
part of it,  from a limited  number  of  investors  deemed by the  Documentation
Agent, in its reasonable  judgment,  to be financially  responsible  parties who
might be interested in purchasing the  Collateral.  If the  Documentation  Agent
solicits  such  offers  from not less  than  four (4) such  investors,  then the
acceptance by the  Documentation  Agent of the highest offer obtained  therefrom
shall be deemed to be a  commercially  reasonable  method of  disposing  of such
Collateral;  provided,  however, that this Section does not impose a requirement
that the Documentation Agent solicit offers from four or more investors in order
for the sale to be commercially reasonable.

                       SECTION 7. THE DOCUMENTATION AGENT

                  7.1  Documentation  Agent's  Appointment as  Attorney-in-Fact,
etc.  (a)  Each  Grantor  hereby   irrevocably   constitutes  and  appoints  the
Documentation  Agent  and any  officer  or agent  thereof,  with  full  power of
substitution,  as its true and  lawful  attorney-in-fact  with full  irrevocable
power and  authority  in the place and stead of such  Grantor and in the name of
such  Grantor or in its own name,  for the purpose of carrying  out the terms of
this Agreement,  to take any and all  appropriate  action and to execute any and
all documents and instruments  which may be necessary or desirable to accomplish
the purposes of this  Agreement,  and,  without  limiting the  generality of the
foregoing,  each  Grantor  hereby  gives the  Documentation  Agent the power and
right,  on behalf of such Grantor,  without notice to or assent by such Grantor,
to do any or all of the following:

                  (i) in the name of such Grantor or its own name, or otherwise,
         take possession of and indorse and collect any checks,  drafts,  notes,
         acceptances  or other  instruments  for the  payment of moneys due with
         respect  to any  Collateral  and file any  claim or take any  action or
         proceeding  in  any  court  of  law  or  equity  or  otherwise   deemed
         appropriate  by the  Documentation  Agent for the purpose of collecting
         any and all such  moneys due with  respect to any  Collateral  whenever
         payable;

                  (ii) pay or  discharge  taxes and Liens levied or placed on or
         threatened against the Collateral,  effect any repairs or any insurance
         called  for by the terms of this  Agreement  and pay all or any part of
         the premiums therefor and the costs thereof;

                  (iii)  execute,  in  connection  with any sale provided for in
         Section 6.6 or 6.7, any indorsements,  assignments or other instruments
         of conveyance or transfer with respect to the Collateral; and

                                      109
<PAGE>

                  (iv) (i) direct any party liable for any payment  under any of
         the  Collateral  to make payment of any and all moneys due or to become
         due  thereunder   directly  to  the  Documentation   Agent  or  as  the
         Documentation Agent shall direct; (ii) ask or demand for, collect,  and
         receive  payment of and receipt  for,  any and all  moneys,  claims and
         other amounts due or to become due at any time in respect of or arising
         out of any Collateral;  (iii) sign and indorse any invoices, freight or
         express bills, bills of lading,  storage or warehouse receipts,  drafts
         against  debtors,   assignments,   verifications,   notices  and  other
         documents in connection with any of the  Collateral;  (iv) commence and
         prosecute any suits,  actions or proceedings at law or in equity in any
         court of  competent  jurisdiction  to  collect  the  Collateral  or any
         portion  thereof  and to  enforce  any other  right in  respect  of any
         Collateral;  (v) defend any suit, action or proceeding  brought against
         such Grantor with respect to any Collateral; (vi) settle, compromise or
         adjust  any  such  suit,   action  or  proceeding  and,  in  connection
         therewith,  give such discharges or releases as the Documentation Agent
         may deem appropriate;  and (vii) generally,  sell, transfer, pledge and
         make any  agreement  with respect to or otherwise  deal with any of the
         Collateral as fully and  completely as though the  Documentation  Agent
         were the  absolute  owner  thereof  for all  purposes,  and do,  at the
         Documentation  Agent's option and such Grantor's expense,  at any time,
         or from time to time, all acts and things which the Documentation Agent
         deems necessary to protect, preserve or realize upon the Collateral and
         the Documentation  Agent's and the Lenders' security  interests therein
         and  to  effect  the  intent  of  this  Agreement,  all  as  fully  and
         effectively as such Grantor might do.

                  Anything   in   this   Section    7.1(a)   to   the   contrary
notwithstanding,  the  Documentation  Agent agrees that it will not exercise any
rights under the power of attorney provided for in this Section 7.1(a) unless an
Event of Default shall have occurred and be continuing.

                  (b) If any Grantor  fails to perform or comply with any of its
agreements contained herein, the Documentation Agent, at its option, but without
any obligation so to do, may perform or comply,  or otherwise cause  performance
or compliance, with such agreement.

                  (c)  The  reasonable   expenses  of  the  Documentation  Agent
incurred in connection with actions  undertaken as provided in this Section 7.1,
together with interest thereon at a rate per annum equal to the highest rate per
annum at which  interest  would then be payable on any  category of past due ABR
Loans under the Credit Agreement,  from the date of payment by the Documentation
Agent to the date reimbursed by the relevant  Grantor,  shall be payable by such
Grantor to the Documentation Agent on demand.

                  (d) Each Grantor hereby ratifies all that said attorneys shall
lawfully do or cause to be done by virtue hereof. All powers, authorizations and
agencies  contained  in this  Agreement  are coupled  with an  interest  and are
irrevocable  until this  Agreement  is  terminated  and the  security  interests
created hereby are released.

                                      110
<PAGE>

                  7.2 Duty of  Documentation  Agent. The  Documentation  Agent's
sole duty with respect to the custody,  safekeeping and physical preservation of
the  Collateral  in its  possession,  under Section 9-207 of the New York UCC or
otherwise,  shall be to deal  with it in the same  manner  as the  Documentation
Agent deals with similar property for its own account. Neither the Documentation
Agent, any Lender nor any of their respective officers, directors,  employees or
agents shall be liable for failure to demand, collect or realize upon any of the
Collateral or for any delay in doing so or shall be under any obligation to sell
or otherwise  dispose of any  Collateral  upon the request of any Grantor or any
other  Person  or to  take  any  other  action  whatsoever  with  regard  to the
Collateral or any part thereof.  The powers conferred on the Documentation Agent
and the Lenders  hereunder are solely to protect the  Documentation  Agent's and
the Lenders'  interests in the Collateral and shall not impose any duty upon the
Documentation Agent or any Lender to exercise any such powers. The Documentation
Agent and the Lenders shall be  accountable  only for amounts that they actually
receive as a result of the exercise of such powers,  and neither they nor any of
their  officers,  directors,  employees  or agents shall be  responsible  to any
Grantor  for any act or  failure  to act  hereunder,  except for their own gross
negligence, bad faith or willful misconduct.

                  7.3   Authority   of   Documentation   Agent.   Each   Grantor
acknowledges that the rights and  responsibilities  of the  Documentation  Agent
under this Agreement with respect to any action taken by the Documentation Agent
or the exercise or non-exercise by the Documentation Agent of any option, voting
right,  request,  judgment  or other  right or  remedy  provided  for  herein or
resulting or arising out of this Agreement  shall, as between the  Documentation
Agent and the  Lenders,  be governed by the Credit  Agreement  and by such other
agreements  with respect thereto as may exist from time to time among them, but,
as between the Documentation  Agent and the Grantors,  the  Documentation  Agent
shall be  conclusively  presumed to be acting as agent for the Lenders with full
and valid  authority so to act or refrain from acting,  and no Grantor  shall be
under any  obligation,  or  entitlement,  to make any  inquiry  respecting  such
authority.

                            SECTION 8. MISCELLANEOUS

                  8.1 Amendments in Writing.  None of the terms or provisions of
this Agreement may be waived, amended, supplemented or otherwise modified except
in accordance with subsection 17.1 of the Credit Agreement.

                  8.2 Notices. All notices,  requests and demands to or upon the
Documentation  Agent or any  Grantor  hereunder  shall be effected in the manner
provided for in subsection 17.3 of the Credit Agreement;  provided that any such
notice, request or demand to or upon any Subsidiary Guarantor shall be addressed
to such  Subsidiary  Guarantor  at its notice  address  set forth on  Schedule 1
hereto.

                                      111
<PAGE>

                  8.3 No Waiver by Course of Conduct;  Cumulative Remedies.  (a)
Neither  any  Agent  nor any  Lender  shall  by any  act  (except  by a  written
instrument pursuant to Section 8.1), delay, indulgence, omission or otherwise be
deemed to have waived any right or remedy hereunder or to have acquiesced in any
Default  or  Event  of  Default.  No  failure  to  exercise,  nor any  delay  in
exercising,  on the  part of any  Agent  or any  Lender,  any  right,  power  or
privilege  hereunder  shall  operate as a waiver  thereof.  No single or partial
exercise of any right, power or privilege  hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
A waiver by any Agent or any Lender of any right or remedy  hereunder on any one
occasion shall not be construed as a bar to any right or remedy which such Agent
or such  Lender  would  otherwise  have on any future  occasion.  The rights and
remedies herein provided are cumulative, may be exercised singly or concurrently
and are not exclusive of any other rights or remedies provided by law.

                  (b) All  rights,  remedies  and  powers  provided  under  this
Agreement  may be exercised  only to the extent that  exercise  thereof does not
violate any  applicable  provision  of law,  and all the  provisions  under this
Agreement are intended to be subject to all applicable  mandatory  provisions of
law which may be  controlling  and (subject to Section 8.8) to be limited to the
extent  necessary  so  that  they  will  not  render  this  Agreement   invalid,
unenforceable in whole or in part or not entitled to be recorded,  registered or
filed under the provisions of any applicable law.

                  8.4 Enforcement Expenses; Indemnification.  (a) Each Guarantor
agrees to pay or reimburse  each Lender and Agent for all its  reasonable  costs
and expenses  incurred in collecting  against such Guarantor under the guarantee
contained in Section 2 or otherwise  enforcing  or  preserving  any rights under
this  Agreement  and the other  Credit  Documents  to which such  Guarantor is a
party, including,  without limitation,  the reasonable fees and disbursements of
counsel to each Lender and of counsel to each of the Agents.

                  (b) Each  Guarantor  agrees to pay, and to save the Agents and
the Lenders harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp,  excise, sales or other taxes which
may be payable or determined to be payable with respect to any of the Collateral
or in connection with any of the transactions contemplated by this Agreement.

                  (c) Each  Guarantor  agrees to pay, and to save the Agents and
the  Lenders  and  their  respective  officers,  directors,  employees,  agents,
investment advisors which are under common  institutional  control with a Lender
and  trustees  harmless  from,  any and all  liabilities,  obligations,  losses,
damages, penalties,  actions, judgments, suits, costs, expenses or disbursements
of any kind or  nature  whatsoever  with  respect  to the  execution,  delivery,
enforcement,  performance and administration of this Agreement to the extent the
Borrowers  would be required to do so pursuant to subsection  17.6 of the Credit
Agreement.

                  (d) The agreements in this Section 8.4 shall survive repayment
of the Obligations and all other amounts payable under the Credit  Agreement and
the other Credit Documents.

                  8.5  Successors and Assigns.  This Agreement  shall be binding
upon the  successors  and assigns of each Grantor and shall inure to the benefit
of the Agents and the Lenders (and their affiliates and subsidiaries  which hold
Obligations)  and their  successors  and assigns;  provided  that no Grantor may
assign,  transfer  or  delegate  any of its  rights or  obligations  under  this
Agreement without the prior written consent of the Documentation Agent.

                                      112
<PAGE>

                  8.6 Set-Off.  Each Grantor hereby  irrevocably  authorizes the
Documentation  Agent, the  Administrative  Agent and each Lender at any time and
from  time to time  while  an  Event  of  Default  shall  have  occurred  and be
continuing, without notice to such Grantor or any other Grantor, any such notice
being expressly waived by each Grantor, to set-off and appropriate and apply any
and all deposits (general or special, time or demand,  provisional or final), in
any currency, and any other credits, indebtedness or claims, in any currency, in
each case  whether  direct or  indirect,  absolute  or  contingent,  matured  or
unmatured,   at  any  time  held  or  owing  by  the  Documentation  Agent,  the
Administrative  Agent or such Lender to or for the credit or the account of such
Grantor,  or any part thereof in such amounts as the  Documentation  Agent,  the
Administrative  Agent or such  Lender may elect,  against  and on account of the
obligations  and  liabilities of such Grantor to the  Documentation  Agent,  the
Administrative  Agent or such Lender  hereunder  and claims of every  nature and
description of the Documentation  Agent, the Administrative Agent or such Lender
against such Grantor,  in any currency,  whether  arising  hereunder,  under the
Credit Agreement,  any other Credit Document or otherwise,  as the Documentation
Agent,  the  Administrative  Agent or such Lender may elect,  whether or not the
Documentation  Agent, the Administrative Agent or any Lender has made any demand
for  payment  and  although  such  obligations,  liabilities  and  claims may be
contingent or unmatured.  The Documentation  Agent, the Administrative Agent and
each Lender  shall  notify  such  Grantor  promptly of any such  set-off and the
application  made by it of the proceeds  thereof,  provided  that the failure to
give such notice shall not affect the validity of such set-off and  application.
The rights of the Documentation  Agent, the Administrative Agent and each Lender
under this Section 8.6 are in addition to other rights and remedies  (including,
without limitation,  other rights of set-off) which the Documentation Agent, the
Administrative Agent or such Lender may have.

                  8.7  Counterparts.  This  Agreement  may be executed by one or
more of the parties to this  Agreement  on any number of  separate  counterparts
(including by telecopy),  and all of said  counterparts  taken together shall be
deemed to constitute one and the same instrument.

                  8.8  Severability.  Any provision of this  Agreement  which is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

                  8.9  Section  Headings.  The  Section  headings  used  in this
Agreement  are for  convenience  of  reference  only and are not to  affect  the
construction hereof or be taken into consideration in the interpretation hereof.

                  8.10   Integration.   This  Agreement  and  the  other  Credit
Documents  represent the agreement of the Grantors,  the Documentation Agent and
the Lenders with respect to the subject matter hereof and thereof, and there are
no promises,  undertakings,  representations  or warranties by the Documentation
Agent or any Lender  relative to subject matter hereof and thereof not expressly
set forth or referred to herein or in the other Credit Documents.

                  8.11 GOVERNING  LAW. THIS AGREEMENT  SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                                      113
<PAGE>

                    8.12  Submission  To  Jurisdiction;  Waivers.  Each  Grantor
hereby irrevocably and unconditionally:

                  (a) submits for itself and its property in any legal action or
         proceeding relating to this Agreement and the other Credit Documents to
         which it is a party, or for recognition and enforcement of any judgment
         in respect thereof,  to the non-exclusive  general  jurisdiction of the
         Courts of the State of New York,  the  courts of the  United  States of
         America for the Southern  District of New York,  and  appellate  courts
         from any thereof;

                  (b) to the extent  permitted by applicable law,  consents that
         any such action or proceeding  may be brought in such courts and waives
         any  objection  that it may now or  hereafter  have to the venue of any
         such  action or  proceeding  in any such  court or that such  action or
         proceeding was brought in an inconvenient court and agrees not to plead
         or claim the same;

                  (c) agrees  that  service  of  process  in any such  action or
         proceeding  may be effected by mailing a copy thereof by  registered or
         certified  mail (or any  substantially  similar form of mail),  postage
         prepaid,  to such Grantor at its address  referred to in Section 8.2 or
         at such other address of which the Documentation  Agent shall have been
         notified pursuant thereto;

                  (d)  agrees  that  nothing  herein  shall  affect the right to
         effect service of process in any other manner permitted by law or shall
         limit the right to sue in any other jurisdiction; and

                  (e) waives,  to the maximum  extent not prohibited by law, any
         right it may have to claim or recover in any legal action or proceeding
         referred  to in  this  Section  any  special,  exemplary,  punitive  or
         consequential damages.

                  8.13 Acknowledgements. Each Grantor hereby acknowledges that:

                  (a)  it has  been  advised  by  counsel  in  the  negotiation,
         execution and delivery of this Agreement and the other Credit Documents
         to which it is a party;

                  (b)  neither  any  Agent  nor any  Lender  has  any  fiduciary
         relationship  with  or  duty  to  any  Grantor  arising  out  of  or in
         connection  with this  Agreement or any of the other Credit  Documents,
         and the  relationship  between the Grantors,  on the one hand,  and the
         Agents and  Lenders,  on the other  hand,  in  connection  herewith  or
         therewith is solely that of debtor and creditor; and

                  (c) no joint venture is created  hereby or by the other Credit
         Documents   or   otherwise   exists  by  virtue  of  the   transactions
         contemplated  hereby  among the Lenders or among the  Grantors  and the
         Lenders.

                                      114
<PAGE>

                  8.14 Additional Grantors.  Each Subsidiary of the Company that
is required to become a party to this Agreement  pursuant to subsection  13.9 of
the Credit  Agreement  shall become a Grantor for all purposes of this Agreement
upon execution and delivery by such Subsidiary of an Assumption Agreement in the
form of Annex 1 hereto.

                  8.15  Termination  of  this  Security  Agreement;  Release  of
Collateral.  (a) The  pledge  made  and the  security  interest  granted  by the
Grantors under this Agreement shall terminate upon final payment in full in cash
of the  Obligations  and the  termination  of the  Commitments  under the Credit
Agreement.  Upon  such  termination  (other  than as a result of the sale of the
Collateral) and at the written request of the relevant Grantor or its successors
or assigns,  and at the cost and expense of such  Grantor or its  successors  or
assigns,  the  Documentation  Agent  shall  execute  in  a  timely  manner  such
instruments,  documents or agreements as are necessary or desirable to terminate
the  Documentation  Agent's security  interest in the Collateral and deliver any
and all Collateral held by the Documentation  Agent (including,  but not limited
to, any Instruments,  Certificated Securities, Chattel Paper, letters of credit,
Pledged Notes, Pledged Stock and stock powers),  subject to any disposition made
by the Documentation Agent pursuant to this Agreement.

                  (b)   Notwithstanding   anything  in  this  Agreement  to  the
contrary,  the Grantors  may, to the extent  permitted by the Credit  Agreement,
sell, assign, transfer or otherwise dispose of any Collateral.  In addition, the
Collateral  shall be subject to release  from time to time (with the  Collateral
referred to in the immediately preceding sentence, the "Released Collateral") in
accordance  with  Section  17.2 of the Credit  Agreement.  The Liens  under this
Agreement  shall  terminate  with respect to the Released  Collateral  upon such
sale, transfer, assignment, disposition or release, and, upon the request of the
relevant  Grantor,  the  Documentation  Agent shall  execute  and  deliver  such
instruments  or  documents  as may be  necessary  to release  the Liens  granted
hereunder,  provided,  however,  that (a) the  Documentation  Agent shall not be
required to execute any such  documents  on terms which,  in its opinion,  would
expose it Agent to liability or create any obligation or entail any  consequence
other than the release of such Liens without  recourse or warranty and (ii) such
release shall not in any manner  discharge,  affect or impair the Obligations or
any  Liens on (or  obligations  of any  Grantor  in  respect  of) all  interests
retained by the Grantor, including without limitation, the proceeds of any sale,
all of which shall  continue to  constitute  part of the  Collateral  unless and
until applied strictly in accordance with the Credit Documents.

                  8.16 WAIVER OF JURY TRIAL.  EACH GRANTOR  AGENT AND LENDER (BY
ITS ACCEPTANCE OF THE BENEFITS  HEREOF) HEREBY  IRREVOCABLY AND  UNCONDITIONALLY
WAIVES  TRIAL  BY  JURY IN ANY  LEGAL  ACTION  OR  PROCEEDING  RELATING  TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

                                      115
<PAGE>

                  IN WITNESS  WHEREOF,  each of the  undersigned has caused this
Agreement to be duly executed and delivered as of the date first above written.

                                                    HEXCEL CORPORATION
                                                    HEXCEL INTERNATIONAL
                                                    HEXCEL OMEGA CORPORATION
                                                    HEXCEL BETA CORP.
                                                    CLARK-SCHWEBEL HOLDING CORP.
                                                    CLARK-SCHWEBEL CORPORATION
                                                    CS TECH-FAB HOLDING, INC.

                                                    By:
                                                    Title:

                                                    CITIBANK, N.A.
                                                      as Documentation Agent

                                                     By:
                                                     Title:

                                      116
<PAGE>

                                                                      Schedule 1

                         NOTICE ADDRESSES OF GUARANTORS

c/o Hexcel Corporation
Two Stamford Plaza
281 Tresser Boulevard
Stamford, Connecticut 06901
Attention: Treasurer
Fax: 208/358-3993

                                      117
<PAGE>

                                                                      Schedule 2

                          DESCRIPTION OF PLEDGED STOCK

<TABLE>
<CAPTION>
A.  Stock Pledged by Hexcel Corporation
--------------------------------------------- --------------------- ----------------------------- ------------------

                   Issuer                        Class of Stock        Stock Certificate No.        No. of Shares
--------------------------------------------- --------------------- ----------------------------- ------------------
<S>                                                  <C>                         <C>                    <C>
Hexcel Pottsville Corporation                        Common                      1                       100
Hexcel Beta Corp.                                    Common                      1                      3,000
Hexcel International                                 Common                      2                       100
Clark-Schwebel Holding Corp.                         Common                      1                      1,000

B.  Stock Pledged by Hexcel International
------------------------------------------------------------------------------------------------- ------------------

                   Issuer                        Class of Stock        Stock Certificate No.        No. of Shares
--------------------------------------------- --------------------- ----------------------------- ------------------
Hexcel Omega Corporation                             Common                      1                      1,000

C.  Stock Pledged by Clark-Schwebel Holding Corp.
------------------------------------------------------------------------------------------------- ------------------

                   Issuer                        Class of Stock        Stock Certificate No.        No. of Shares
--------------------------------------------- --------------------- ----------------------------- ------------------
Hexcel CS Corporation                                Common                      1                      1,000
--------------------------------------------- --------------------- ----------------------------- ------------------

D.  Stock Pledged by Hexcel CS Corporation
------------------------------------------------------------------------------------------------- ------------------

                   Issuer                        Class of Stock        Stock Certificate No.        No. of Shares
--------------------------------------------- --------------------- ----------------------------- ------------------

CS Tech-Fab Holding, Inc.                            Common                      1                      1,000
--------------------------------------------- --------------------- ----------------------------- ------------------
</TABLE>

                                      118
<PAGE>

                                                                      Schedule 3

                               INTERCOMPANY NOTES

         1. Promissory  Note,  dated September 15, 1998, in the principal amount
of US$44,400,000,  issued by Clark-Schwebel  Holding Corp. and payable to Hexcel
Corporation.

         2. Promissory  Note,  dated September 15, 1998, in the principal amount
of US$400,475,952, issued by Hexcel CS Corporation (to be renamed Clark-Schwebel
Corporation) and payable to Hexcel Corporation.

         3. Promissory  Note,  dated September 15, 1998, in the principal amount
of  US$4,200,000,  issued by CS  Tech-Fab  Holding,  Inc.  and payable to Hexcel
Corporation.

                                      119
<PAGE>

                                                                      Schedule 4

            JURISDICTIONS OF ORGANIZATION AND CHIEF EXECUTIVE OFFICES

<TABLE>
<CAPTION>
                                                  Jurisdiction of                     Location of Chief
                 Grantor                            Organization                       Executive Office
------------------------------------------ -------------------------------- ----------------------------------------
<S>                                        <C>                              <C>
Hexcel Corporation                         Delaware                         Two Stamford Plaza
                                                                            281 Tresser Boulevard
                                                                            Stamford, CT  06901

Hexcel International                       California                       5794 West Las Positas Blvd.
                                                                            Pleasanton, CA  94588

Hexcel Omega Corporation                   California                       5794 West Las Positas Blvd.
                                                                            Pleasanton, CA  94588

Hexcel Beta Corp.                          Delaware                         5794 West Las Positas Blvd.
                                                                            Pleasanton, CA  94588

Clark-Schwebel Holding Corp.               Delaware                         Two Stamford Plaza
                                                                            281 Tresser Boulevard
                                                                            Stamford, CT  06901

Clark-Schwebel Corporation                 Delaware                         2200 South Murray Avenue
                                                                            Anderson, SC  29624

CS Tech-Fab Holding, Inc.                  Delaware                         2200 South Murray Avenue
                                                                            Anderson, SC  29624
------------------------------------------ -------------------------------- ----------------------------------------
</TABLE>

                                      120
<PAGE>

                                                                      Schedule 5

                      LOCATIONS OF INVENTORY AND EQUIPMENT

<TABLE>
<CAPTION>
                         Grantor                                                   Locations
----------------------------------------------------------- --------------------------------------------------------
<S>                                                         <C>
Hexcel Corporation                                          See attached Exhibit 1 to this Schedule 5.
Hexcel International                                        None.
Hexcel Omega Corporation                                    None.
Hexcel Beta Corp.                                           None.
Clark-Schwebel Holding Corp                                 None.
Clark-Schwebel Corporation                                  See attached Exhibit 1 to this Schedule 5.
CS Tech-Fab Holding, Inc.                                   None.
----------------------------------------------------------- --------------------------------------------------------
</TABLE>

                                      121
<PAGE>

                                                                      Schedule 6

                                FILINGS REQUIRED
                          TO PERFECT SECURITY INTERESTS

                         Uniform Commercial Code Filings

<TABLE>
<CAPTION>
Name                                                        Jurisdictions
----------------------------------------------------------- --------------------------------------------------------
<S>                                                         <C>
Hexcel Corporation                                          AL SOS
                                                            AZ SOS
                                                            CA SOS
                                                            CT SOS
                                                            DE SOS
                                                            GA - Fulton County, White County, Wilkes County
                                                            MA SOS / Northborough Town
                                                            NC SOS / Iredell County
                                                            OH  SOS /  Fairfield County
                                                            PA   SOS  / Chester County, Schuylkill County
                                                            SC SOS
                                                            TX SOS
                                                            UT SOS
                                                            VA SOS / Fairfax County
                                                            WA SOS

Clark-Schwebel Corporation                                  CA SOS
                                                            CT SOS
                                                            DE SOS
                                                            GA -  White  County, Wilkes County
                                                            MA SOS / Northborough Town
                                                            NC   SOS / Iredell County
                                                            SC SOS
                                                            TX SOS

Clark-Schwebel Holding Corp.                                CT SOS
                                                            DE SOS
                                                            SC SOS

CS Tech-Fab Holding, Inc.                                   CT SOS
                                                            DE SOS
                                                            SC SOS

Hexcel Beta Corp.                                           CA SOS
                                                            CT SOS
                                                            DE SOS

Hexcel International                                        CA SOS
                                                            CT SOS

Hexcel Omega Corporation                                    CA SOS
                                                            CT SOS
----------------------------------------------------------- --------------------------------------------------------
</TABLE>

                                      122
<PAGE>

                          ACKNOWLEDGMENT AND CONSENT1/

         The undersigned  hereby  acknowledges  receipt of a copy of the Amended
and Restated  Collateral  Agreement dated as of March 7, 2000 (the "Agreement"),
made by the  Grantors  parties  thereto for the benefit of  Citibank,  N.A.,  as
Documentation Agent. The undersigned agrees for the benefit of the Documentation
Agent  and the  Lenders  (and  their  affiliates  and  subsidiaries  which  hold
Obligations) as follows:

         1. The undersigned will be bound by the terms of the Agreement and will
comply with such terms insofar as such terms are applicable to the undersigned.

         2. The  undersigned  will notify the  Documentation  Agent  promptly in
writing of the  occurrence of any of the events  described in Section  5.7(a) of
the Agreement.

         3. The terms of Sections 6.3(c) and 6.7 of the Agreement shall apply to
it,  mutatis  mutandis,  with  respect to all actions that may be required of it
pursuant to Section 6.3(c) or 6.7 of the Agreement.

                                                     [NAME OF ISSUER]

                                                     By:
                                                     Name:
                                                     Title:

                                                     Address for Notices:

                                                     Fax:

                                      123
<PAGE>

                                                                      Annex 1 to
                                                            Collateral Agreement

                  ASSUMPTION AGREEMENT, dated as of ________________, 2000, made
by ______________________________, a ______________ corporation (the "Additional
Grantor"), in favor of CITIBANK, N.A., as Documentation Agent (in such capacity,
the "Documentation  Agent") for the banks and other financial  institutions (the
"Lenders")  parties to the Credit  Agreement  referred to below. All capitalized
terms not defined herein shall have the meaning  ascribed to them in such Credit
Agreement.

                              W I T N E S S E T H :

                  WHEREAS, Hexcel Corporation (the "Company") and certain of its
Subsidiaries  (together with the Company,  the  "Borrowers"),  the Lenders,  the
Documentation  Agent and Credit Suisse First Boston,  as  Administrative  Agent,
have entered into a Second Amended and Restated  Credit  Agreement,  dated as of
September 15, 1998 (as amended,  supplemented or otherwise modified from time to
time, the "Credit Agreement");

                  WHEREAS, in connection with the Credit Agreement,  the Company
and certain of its Affiliates  (other than the Additional  Grantor) have entered
into the Amended and Restated  Collateral  Agreement,  dated as of March 7, 2000
(as  amended,  supplemented  or  otherwise  modified  from  time  to  time,  the
"Collateral Agreement") in favor of the Documentation Agent;

                    WHEREAS,   the  Credit  Agreement  requires  the  Additional
Grantor to become a party to the Collateral Agreement; and

                  WHEREAS,  the  Additional  Grantor  has agreed to execute  and
deliver this  Assumption  Agreement in order to become a party to the Collateral
Agreement;

                  NOW, THEREFORE, IT IS AGREED:

                  1.  Collateral  Agreement.  By executing and  delivering  this
Assumption Agreement, the Additional Grantor, as provided in Section 8.14 of the
Collateral  Agreement,  hereby becomes a party to the Collateral  Agreement as a
Grantor thereunder with the same force and effect as if originally named therein
as a Grantor and,  without  limiting the  generality  of the  foregoing,  hereby
expressly assumes all obligations and liabilities of a Grantor  thereunder.  The
information set forth in Annex 1-A hereto is hereby added to the information set
forth in the  Schedules to the  Collateral  Agreement.  The  Additional  Grantor
hereby represents and warrants that each of the  representations  and warranties
contained in Section 4 of the Collateral Agreement is true and correct on and as
the date hereof (after giving effect to this Assumption Agreement) as if made on
and as of such date.

                                      124
<PAGE>

                  2. Governing Law. THIS ASSUMPTION  AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND  INTERPRETED  IN ACCORDANCE  WITH, THE LAW OF THE STATE OF
NEW YORK.

                  IN WITNESS WHEREOF, the undersigned has caused this Assumption
Agreement to be duly executed and delivered as of the date first above written.

                                                     [ADDITIONAL GRANTOR]

                                                     By:
                                                     Name:
                                                     Title:

                                      125
<PAGE>

                                                                    Annex 1-A to
                                                           Assumption Agreement

                            Supplement to Schedule 1

                            Supplement to Schedule 2

                            Supplement to Schedule 3

                                      126
<PAGE>

                    AMENDED AND RESTATED COLLATERAL AGREEMENT

                                     made by

                               HEXCEL CORPORATION

                         and certain of its Subsidiaries

                                   in favor of

                                 CITIBANK, N.A.,
                             as Documentation Agent

                            Dated as of March 7, 2000

                                      127
<PAGE>

                                      -iv-

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                               Page
<S>      <C>                                                                                                     <C>
SECTION 1.  DEFINED TERMS.........................................................................................2
         1.1  Definitions.........................................................................................2
         1.2  Other Definitional Provisions.......................................................................3

SECTION 2.  GUARANTEE.............................................................................................3
         2.1  Guarantee...........................................................................................3
         2.2  Right of Contribution...............................................................................4
         2.3  No Subrogation......................................................................................4
         2.4  Amendments, etc. with Respect to the Obligations....................................................5
         2.5  Guarantee Absolute and Unconditional................................................................5
         2.6  Reinstatement.......................................................................................6
         2.7  Payments............................................................................................6

SECTION 3.  GRANT OF SECURITY INTEREST............................................................................6

SECTION 4.  REPRESENTATIONS AND WARRANTIES........................................................................7
         4.1  Title; No Other Liens...............................................................................7
         4.2  Perfected First Priority Liens......................................................................8
         4.3  Chief Executive Office..............................................................................8
         4.4  Inventory and Equipment.............................................................................8
         4.5  Investment Property.................................................................................8
         4.6  Receivables.........................................................................................9

SECTION 5.  COVENANTS.............................................................................................9
         5.1  Delivery of Instruments, Certificated Securities and Chattel Paper..................................9
         5.2  Maintenance of Insurance............................................................................9
         5.3  Payment of Obligations.............................................................................10
         5.4  Maintenance of Perfected Security Interest; Further Documentation..................................10
         5.5  Changes in Locations, Name, etc....................................................................11
         5.6  Notices............................................................................................11
         5.7  Investment Property................................................................................11
         5.8  Receivables........................................................................................12

SECTION 6.  REMEDIAL PROVISIONS..................................................................................13
         6.1  Certain Matters Relating to Receivables............................................................13
         6.2  Communications with Obligors; Grantors Remain Liable...............................................13
         6.3  Pledged Stock......................................................................................14
         6.4  Proceeds to be Turned Over To Documentation Agent..................................................15
         6.5  Application of Proceeds............................................................................15
         6.6  Code and Other Remedies............................................................................15
         6.7  Registration Rights................................................................................16
         6.8  Waiver; Deficiency.................................................................................17
         6.9  Notice to Grantor of Sale..........................................................................17
         6.10  Other Sales.......................................................................................18

SECTION 7.  THE DOCUMENTATION AGENT..............................................................................18
         7.1  Documentation Agent's Appointment as Attorney-in-Fact, etc.........................................18
         7.2  Duty of Documentation Agent........................................................................19
         7.3  Authority of Documentation Agent...................................................................20

SECTION 8.  MISCELLANEOUS........................................................................................20
         8.1  Amendments in Writing..............................................................................20
         8.2  Notices............................................................................................20
         8.3  No Waiver by Course of Conduct; Cumulative Remedies................................................20
         8.4  Enforcement Expenses; Indemnification..............................................................21
         8.5  Successors and Assigns.............................................................................21
         8.6  Set-Off............................................................................................21
         8.7  Counterparts.......................................................................................22
         8.8  Severability.......................................................................................22
         8.9  Section Headings...................................................................................22
         8.10  Integration.......................................................................................22
         8.11  GOVERNING LAW.....................................................................................22
         8.12  Submission To Jurisdiction; Waivers...............................................................23
         8.13  Acknowledgements..................................................................................23
         8.14  Additional Grantors...............................................................................23
         8.15  Termination of this Security Agreement; Release of Collateral.....................................24
         8.16  WAIVER OF JURY TRIAL..............................................................................24
</TABLE>

                                      128
<PAGE>

<TABLE>
<CAPTION>
SCHEDULES
<S>               <C>
Schedule 1        Notice Addresses
Schedule 2        Pledged Stock
Schedule 3        Intercompany Notes
Schedule 4        Jurisdictions of Organization and Chief Executive Offices
Schedule 5        Inventory and Equipment Locations
Schedule 6        Perfection Matters
</TABLE>

1/       This consent is necessary  only with respect to any Issuer which is not
         also a Grantor. This consent may be modified or eliminated with respect
         to any Issuer  that is not  controlled  by a  Grantor.  If a consent is
         required,  its  execution  and  delivery  should be included  among the
         conditions to the initial borrowing specified in the Credit Agreement.

                                      129
<PAGE>

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