Document:

Exhibit 10.14

                              Katy Industries, Inc.
                       Director Compensation Arrangements

1.    Retainer

            a.    Each non-employee director receives a $10,000 annual retainer,
                  paid annually in advance.

            b.    The chair of the Compensation Committee and the chair of the
                  Audit Committee each receive an additional $6,000 annual
                  retainer, paid annually in advance.

2.    Meeting Fees

            a.    Each non-employee director is paid $2,500 for each full Board
                  meeting he or she attends in person and $1,000 for each full
                  Board meeting he or she attends telephonically.

            b.    Each non-employee director is paid $1,000 for each full
                  Committee meeting he or she attends in person and $500 for
                  each full Committee meeting he or she attends telephonically.

3.    Stock Options

            a.    Each non-employee director receives an annual option grant of
                  2,000 options at the May Board Meeting each year. The exercise
                  price is the fair market value on the date of grant. The
                  director may exercise these options at any time during the ten
                  years from the date of grant.

4.    Stock Grant

            a.    Each non-employee director receives a grant of 1,000 shares of
                  Katy Common Stock at the May Board Meeting each year. These
                  shares are unrestricted.

5.    Meeting Expenses

            a.    Katy reimburses directors for their expenses incurred in
                  attending Board of Director and Committee meetings.

6.    Deferred Compensation Plan

            a.    Each non-employee director may defer directors' fees,
                  retainers and other compensation paid for services as a
                  director until the later of the director's attainment of age
                  62 or ceasing to be a director. Each director has 30 days
                  before the beginning of a Plan Year (as defined in the
                  Directors' Deferred Compensation Plan) in which to elect to
                  participate in the Directors' Deferred Compensation Plan.
                  Directors may invest these amounts in one or more investment
                  alternatives offered by Katy. Directors may elect to receive
                  distributions of deferred amounts in a lump sum or five annual
                  installments.

Note: Class II directors and those directors that are also officers do not
receive the compensation described in this section for their service on the
Board of Directors.

                                       89Exhibit 10.15

                              Katy Industries, Inc.
                   Executive Officer Compensation Arrangements

The base salaries as of April 11, 2005 for the named executive  officers of Katy
Industries, Inc. (the "Company") as approved at the April 8, 2005 meeting of the
Compensation Committee of the Company's Board of Directors, are as follows:

         C. Michael Jacobi       $565,000
         Amir Rosenthal          $315,000
         David S. Rahilly        $250,000
         David C. Cooksey        $170,000
         Michael C. Paul         $169,700

As part of his or her annual compensation, each of the named executive officers
is also eligible for a cash bonus in accordance with the terms of the Katy
Industries, Inc. Executive Bonus Plan. In addition to the foregoing, the Company
pays automobile and other allowances, certain club memberships, all or a portion
of the premiums for group term life insurance policies for each of the executive
officers and contributes matching amounts to each of the executives under Katy's
401(k) plan.Exhibit 10.17

                                                                  Execution Copy

                               THIRD AMENDMENT TO
                       AMENDED AND RESTATED LOAN AGREEMENT

      THIS THIRD  AMENDMENT  TO AMENDED  AND  RESTATED  LOAN  AGREEMENT  ("Third
Amendment")  is made as of this 13th day of  April,  2005,  by and  among  FLEET
CAPITAL CORPORATION  ("Fleet"), a Rhode Island corporation with an office at One
South Wacker Drive,  Suite 3400,  Chicago,  Illinois  60606,  individually  as a
Lender and as Agent  ("Agent")  for itself and any other  financial  institution
which is or becomes a party hereto (each such financial  institution,  including
Fleet, is referred to hereinafter individually as a "Lender" and collectively as
the "Lenders"),  the CANADIAN  PARTICIPANTS party hereto, the U.K.  PARTICIPANTS
party hereto, FLEET CAPITAL GLOBAL FINANCE,  INC.,  individually as a Lender and
as Canadian Agent ("Canadian Agent"),  BANK OF AMERICA,  N.A., London branch (as
successor-in-interest   to  Fleet  National  Bank,  London  branch,  trading  as
FleetBoston  Financial),  individually  as a  Lender  and as U.K.  Agent  ("U.K.
Agent"), WELLS FARGO FOOTHILL,  LLC, as Syndication Agent, LASALLE BANK NATIONAL
ASSOCIATION,  as  Documentation  Agent, the LENDERS,  KATY  INDUSTRIES,  INC., a
Delaware  corporation,  with its chief  executive  office and principal place of
business at 765 Straits  Turnpike,  Suite 2000,  Middlebury,  Connecticut  06762
("Katy"  or  "U.S.  Borrower"),  WOODS  INDUSTRIES  (CANADA)  INC.,  a  Canadian
corporation  with its chief executive  office and principal place of business at
375 Kennedy  Road,  Scarborough,  Ontario M1K 2A3 ("Woods  Canada" or  "Canadian
Borrower") and CEH LIMITED ("CEH" or "U.K. Borrower"), a private limited company
incorporated under the laws of England and Wales and registered with Company No.
4992300 whose  registered  office is Cardrew Way,  Redruth  Cornwall,  TR15 1ST,
England.  Katy,  Woods  Canada and CEH are  sometimes  hereinafter  referred  to
individually as a "Borrower" and collectively as "Borrowers."

                              W I T N E S S E T H:

      WHEREAS,  Agent,  Lenders,   Canadian  Participants,   U.K.  Participants,
Canadian  Agent,  U.K.  Agent and Borrowers  entered into a certain  Amended and
Restated Loan Agreement dated as of April 20, 2004 as amended by a certain First
Amendment  to Amended and  Restated  Loan  Agreement  dated June 29, 2004 by and
among Agents, Lenders and Borrowers and by a certain Second Amendment to Amended
and Restated Loan  Agreement  dated March 29, 2005 by and among Agents,  Lenders
and Borrowers (said Loan Agreement, as so amended, is hereinafter referred to as
the "Loan Agreement"); and

      WHEREAS,  Borrowers  desire to amend and modify certain  provisions of the
Loan Agreement pursuant to the terms and conditions hereof;

      WHEREAS,  subject  to the terms and  conditions  hereof,  Agent,  Lenders,
Canadian  Participants,  U.K.  Participants,  U.K.  Agent and Canadian Agent are
willing to so amend and modify the Loan Agreement; and

<PAGE>

      NOW THEREFORE,  in consideration of the premises, the mutual covenants and
agreements  herein  contained,  and any extension of credit  heretofore,  now or
hereafter  made by Agent and Lenders to  Borrowers,  the parties  hereto  hereby
agree as follows:

1.    Definitions.  All capitalized  terms used herein without  definition shall
      have the meanings given to them in the Loan Agreement.

2.    Additional  and Amended  Definitions.  The  definitions  of  "Availability
      Block" and "Third  Amendment  Effective  Date" are  hereby  inserted  into
      Appendix A to the Loan Agreement.  The definition of "U.S. Borrowing Base"
      is hereby deleted and the following is inserted in its stead.

            "Availability  Block - $5,000,000 from the Third Amendment Effective
      Date until  September 29, 2005,  $7,500,000  from September 30, 2005 until
      the  date on  which  Borrowers  have  delivered  to  Agent  the  financial
      statements for the period ending March 31, 2006 and $0 thereafter.

                                      *   *  *

            Third  Amendment  Effective  Date - as  defined  in Section 8 of the
      Third Amendment.

                                      *   *  *

            U.S.  Borrowing Base - as at any date of determination  thereof,  an
      amount equal to the lesser of:

            (i) the U.S. Revolving Loan Commitment minus the Availability Block,
      or

            (ii) an amount equal to the sum of:

                  (a) 85% of the net amount of Eligible  Accounts  of U.S.  Loan
            Parties (as defined below) outstanding at such date; plus

                  (b) the lesser of (1)  $60,000,000  or (2) 65% of the value of
            Eligible Inventory of U.S. Loan Parties at such date; plus

                  (c)  if,  on  such  date,  no  Eligible  Account  or  Eligible
            Inventory of U.K.  Loan  Parties are included in the U.K.  Borrowing
            Base as evidenced by a Borrowing  Base  Certificate,  85% of the net
            amount of Eligible Accounts of U.K. Loan Parties outstanding at such
            date; plus

                  (d)  if,  on such  date,  no  Eligible  Accounts  or  Eligible
            Inventory of U.K.  Loan  Parties are included in the U.K.  Borrowing
            Base as evidenced by a Borrowing Base Certificate, the lesser of (1)
            $6,000,000  or (2) 65% of the Value of  Eligible  Inventory  of U.K.
            Loan Parties at such date, minus (subtract from the sum of (a), (b),
            (c) and (d) above);

                                       2
<PAGE>

                  (e) the sum of (1) the Hedge  Reserve  applicable to U.S. Loan
            Parties,  (2) Dilution Reserves applicable to U.S. Loan Parties, (3)
            Rent Reserves  applicable  to U.S.  Loan Parties,  (4) the Revolving
            Loan Repayment Reserve applicable to U.S. Loan Parties, (5) the PAYE
            Reserve (to the extent Eligible  Accounts and Eligible  Inventory of
            U.K. Loan Parties are included in the U.S.  Borrowing Base), (6) the
            aggregate amount of other reserves  applicable to U.S. Loan Parties,
            if any,  established  by  Agent  in the  exercise  of its  Permitted
            Discretion  against Eligible Accounts and Eligible Inventory and (7)
            the Availability Block.

      provided that Agent, in the exercise of its Permitted Discretion,  may (a)
      increase or decrease  reserves  against Eligible  Accounts  Receivable and
      Eligible  Inventory  and (b) reduce the  advance  rates  provided  in this
      definition,  or restore such advance  rates to any level equal to or below
      the advance rates in effect as of the Closing Date.

            For purposes hereof,  (1) the net amount of Eligible Accounts at any
      time shall be the face amount of such Eligible Accounts,  less any and all
      returns,  rebates,  discounts (which may, at Agent's option, be calculated
      on shortest terms), credits allowance or excise taxes of any nature at any
      time issued,  owing, claimed by Account Debtors,  granted,  outstanding or
      payable in  connection  with such accounts at such time and (2) the amount
      of Eligible Inventory shall be determined on a first-in,  first-out, lower
      of cost or market basis in accordance  with GAAP,  with costs adjusted for
      differences between standard and actual costs."

                                      *   *  *

3.    Availability  Block.  Any amendment or  modification  to the definition of
      U.S. Borrowing Base that has the effect of deleting, changing or modifying
      the manner in which the Availability Block is used in determining the U.S.
      Borrowing Base or amends or modifies the definition of Availability  Block
      shall require the consent of Borrowers, all Lenders and Agent.

4.    Capital  Expenditure.  Subsection  7.2.8 of the Loan  Agreement  is hereby
      deleted and the following is inserted in its stead:

            "7.2.8 Capital Expenditures.

                  (a) Make  Non-Restructuring  Capital Expenditures  (including,
            without  limitation,  by way of capitalized leases but excluding (x)
            Capital  Expenditures  funded from  insurance,  condemnation or sale
            proceeds of Equipment and real Property and (y) Capital Expenditures
            made in connection  with the purchase of the Wilen  Facility (to the
            extent such Capital  Expenditures  are no more than $500,000 greater
            than the net proceeds  received from the Wilen Sale and  Leaseback))
            which,  in  the  aggregate,   as  to  Borrowers  and  all  of  their
            Subsidiaries,  exceed  $10,000,000  during  the fiscal  year  ending
            December  31, 2005 or  $15,000,000  during any other  fiscal year of
            Katy,  except  that up to  $3,000,000  of

                                       3
<PAGE>

            the unused  portion  of the  Non-Restructuring  Capital  Expenditure
            allowance for any fiscal year may be carried over to the immediately
            succeeding  fiscal year only  (excluding,  however,  the fiscal year
            ending December 31, 2005), to be used in such succeeding fiscal year
            after all of the  Capital  Expenditure  allowance  for that year has
            been used.

                  (b)  Make  Restructuring   Capital  Expenditures   (including,
            without  limitation,  by way of  capitalized  leases  but  excluding
            Capital  Expenditures  funded from  insurance,  condemnation or sale
            proceeds of Equipment and real Property), which in the aggregate, as
            to Borrowers and all of their Subsidiaries  exceed $2,000,000 in the
            fiscal year ending December 31, 2004, or $0 in any subsequent fiscal
            year,  except  that up to  $500,000  of the  unused  portion  of the
            Restructuring Capital Expenditures allowance for any fiscal year may
            be carried over to the immediately succeeding fiscal year only to be
            used in such  succeeding  fiscal  year  after all the  Restructuring
            Capital Expenditure allowance for that year has been used."

5.    Financial Covenants.  Upon the Third Amendment Effective Date, Exhibit 7.3
      attached  to the Loan  Agreement  shall be deemed  deleted and Exhibit 7.3
      attached hereto and incorporated herein shall be inserted in its stead.

6.    Interest Rates. From the Third Amendment  Effective Date until the date on
      which Borrowers  deliver to Agent the financial  statements for the period
      ending  March  31,  2006 in  compliance  with  subsection  7.1.3(ii),  the
      Applicable Margin shall equal the following:

      (a)   U.K. and Canadian Loans.  With respect to Revolving  Credit Loans to
            U.K.  Borrower in Sterling and Euros,  to Revolving  Credit Loans to
            Canadian  Borrower in Canadian  Dollars and the issuance of Canadian
            Letters  of Credit or  Canadian  LC  Guaranties  or U.K.  Letters of
            Credit or U.K. LC Guaranties,  the  percentages set forth below with
            respect to the Base Rate  Revolving  Portion,  Canadian Prime Loans,
            the LIBOR Revolving  Portion,  Canadian BA Rate Loans and the Letter
            of Credit and LC Guaranty Fees:

                     Base Rate Revolving Portion or        2.75%
                     Canadian Prime Loans

                     LIBOR Revolving Portion or Canadian   2.75%
                     BA Rate Loans

                     LC Fee                                2.50%

      (b)   U.S. Loans.  With respect to Revolving Credit Loans to U.S. Borrower
            in  Dollars,  the  Term  Loan,  U.S.  Letters  of  Credit,  U.S.  LC
            Guaranties and the Unused Line Fee, the  percentages set forth below
            with respect to the Base Rate Revolving Portion,  the Base Rate Term
            Portion,  the LIBOR Revolving Portion,  the LIBOR

                                       4
<PAGE>

            Term  Portion,  the  Letter of Credit and LC  Guaranty  Fees and the
            Unused Line Fee:

                           Base Rate Revolving Portion           1.00%
                           Base Rate Term Portion                1.25%
                           LIBOR Revolving Portion               2.75%
                           LIBOR Term Portion                    3.00%
                           LC Fee                                2.50%
                           Unused Line Fee                       0.50%

                  Upon the delivery to Agent of the financial statements for the
            period ending March 31, 2006 in compliance with subsection 7.1.3(ii)
            of the Loan Agreement,  the Applicable Margin shall be determined as
            provided in the  definition of such term  contained in Appendix A of
            the Loan Agreement.

7.    2004 Annual  Audited  Financial  Statements.  Agent and Lenders  waive any
      Event of Default  arising from the failure of Borrowers to deliver  Katy's
      annual unaudited financial  statements for the fiscal year ending December
      31, 2004 by March 31, 2005 as required by subsection  7.1.3(i) of the Loan
      Agreement.  Borrowers  covenant  to deliver to Agent and each  Lender such
      annual audited financial statements on or prior to April 15, 2005.

8.    Condition  Precedent.  This Third  Amendment  shall become  effective when
      Borrowers,  Agents and all Lenders  shall have  executed and  delivered to
      each other this Third  Amendment.  The date on which each of the foregoing
      conditions  precedent  is  satisfied  shall be  referred  to as the "Third
      Amendment Effective Date."

9.    Continuing  Effect.  Except as otherwise  specifically set out herein, the
      provisions of the Loan Agreement shall remain in full force and effect.

10.   Governing Law. This Third Amendment and the obligations  arising hereunder
      shall be governed by, and construed and enforced in accordance  with,  the
      laws of the State of Illinois  applicable to contracts  made and performed
      in  such  state,  without  regard  to  the  principles  thereof  regarding
      conflicts of laws.

11.   Counterparts.  This  Third  Amendment  may be  executed  in any  number of
      separate counterparts,  each of which shall,  collectively and separately,
      constitute one agreement.

                            (Signature Page Follows)

                                       5
<PAGE>

              (Signature Page to Third Amendment to Loan Agreement)

      IN WITNESS WHEREOF, this Third Amendment has been duly executed on the day
and year specified at the beginning of this Third Amendment.

                                  KATY INDUSTRIES, INC.

                                  By: /s/ Amir Rosenthal
                                      ----------------------------------
                                       Name:  Amir Rosenthal
                                       Title: Vice President and CFO

<PAGE>

                                  CEH LIMITED

                                  By: /s/ C. Michael Jacobi
                                      ------------------------------
                                      Name:  C. Michael Jacobi
                                            ------------------------
                                      Title: Director
                                            ------------------------

                                  and

                                  By: /s/ Christopher W. Anderson
                                      ------------------------------
                                      Name:  Christopher W. Anderson
                                            ------------------------
                                      Title: Director
                                            ------------------------

<PAGE>

                                  WOODS INDUSTRIES (CANADA) INC.

                                  By: /s/ Amir Rosenthal
                                      ------------------------------
                                      Name:  Amir Rosenthal
                                            ------------------------
                                      Title: Secretary
                                            ------------------------

<PAGE>

                                  FLEET CAPITAL CORPORATION,
                                    as Agent and as a Lender

                                  By: /s/ Jason Riley
                                      ------------------------------
                                      Name:  Jason Riley
                                            ------------------------
                                      Title: VP
                                            ------------------------

<PAGE>

                                  WELLS FARGO FOOTHILL LLC,
                                  as Syndication Agent and Lender

                                  By: /s/ Mike Baranowski
                                      -------------------------------------
                                      Name: Mike Baranowski
                                            -------------------------------
                                      Title: Vice President
                                            -------------------------------

<PAGE>

                                  LASALLE BANK NATIONAL ASSOCIATION,
                                  as Documentation Agent and as a Lender

                                  By: /s/ Mark Mital
                                      -------------------------------------
                                      Name:  Mark Mital
                                            -------------------------------
                                      Title: First Vice President
                                            -------------------------------

<PAGE>

                                  UPS CAPITAL CORPORATION, as a Lender

                                  By: /s/ John P. Holloway
                                      -----------------------------------------
                                      Name:  John P. Holloway
                                            -----------------------------------
                                      Title: Director of Portfolio Management
                                            -----------------------------------

<PAGE>

                                  BANK OF AMERICA, N.A., London branch,
                                  as U.K. Agent and U.K. Lender

                                  By: /s/ Jason Riley
                                      -----------------------------------------
                                      Name:  Jason Riley
                                            -----------------------------------
                                      Title: VP
                                            -----------------------------------

<PAGE>

                                  FLEET CAPITAL GLOBAL FINANCE, INC.,
                                  as Canadian Agent and Canadian Lender

                                  By: /s/ Doug McKenzie
                                      -----------------------------------------
                                      Name:  Doug McKenzie
                                            -----------------------------------
                                      Title: Vice President
                                            -----------------------------------

<PAGE>

      Accepted and Agreed to this 13th day of April, 2005.

                                  GUARANTORS:

                                  KKTY HOLDING COMPANY, L.L.C.

                                  By: /s/ Christopher W. Anderson
                                      ----------------------------------------
                                      Name:  Christopher W. Anderson
                                             ---------------------------------
                                      Title: Authorized Manager
                                             ---------------------------------

                                  AMERICAN GAGE & MACHINE CO.

                                  By: /s/ Amir Rosenthal
                                      ----------------------------------------
                                      Name:  Amir Rosenthal
                                            ----------------------------------
                                      Title: Secretary
                                            ----------------------------------

                                  CONTINENTAL COMMERCIAL PRODUCTS, LLC

                                  By: /s/ Amir Rosenthal
                                      ----------------------------------------
                                      Name:  Amir Rosenthal
                                            ----------------------------------
                                      Title: Secretary
                                            ----------------------------------

                                  PTR MACHINE CORP.

                                  By: /s/ Amir Rosenthal
                                      ----------------------------------------
                                      Name:  Amir Rosenthal
                                           -----------------------------------
                                      Title: Secretary
                                           -----------------------------------

                                  SAVANNAH ENERGY SYSTEMS COMPANY

                                  By: /s/ Amir Rosenthal
                                      ----------------------------------------
                                      Name:  Amir Rosenthal
                                           -----------------------------------
                                      Title: Secretary
                                           -----------------------------------

                                  WOODS INDUSTRIES, INC.

                                  By: /s/ Amir Rosenthal
                                      ----------------------------------------
                                      Name:  Amir Rosenthal
                                           -----------------------------------
                                      Title: Secretary
                                           -----------------------------------
<PAGE>
                                  EXHIBIT 7.3

                               FINANCIAL COVENANTS

DEFINITIONS

            Consolidated EBITDA - for any period, the sum, without  duplication,
of the amounts for such period of (i)  Consolidated  Net Income,  (ii)  interest
expense,  (iii)  provisions for taxes based on income,  (iv) total  depreciation
expense, (v) total amortization expense, (vi) all unusual expenses and all other
non-capitalized   restructuring   expenses   (including   costs   and   expenses
attributable to employee severance obligations and facility consolidation costs)
for such period to the extent not  disallowed  by Agent in its sole  discretion,
(vii) any  payment of or accrual  for the  Management  Fee under the  Management
Agreement,  (viii) all other payments made to K&C and its Affiliates during such
period  for  expenses  incurred  on  behalf  of  Parent,  Katy  or any of  their
respective  Subsidiaries  pursuant to  Kohlberg  Agreements,  (ix) any  non-cash
expense incurred with respect to Katy's stock  appreciation  rights plan ("SAR")
and (x) any  non-cash  expense  with  respect to changes in market  value of any
options to purchase  Katy's  Common Stock and (xi) other  non-cash  items (other
than any such  non-cash  item to the extent that it  represents an accrual of or
reserve for cash  expenditures in any future  period),  but only, in the case of
clauses (ii)-(xi), to the extent deducted in the calculation of Consolidated Net
Income less other non-cash items added in the  calculation of  Consolidated  Net
Income  (other than any such  non-cash item to the extent that it will result in
the receipt of cash  payments in any future  period),  all of the  foregoing  as
determined on a consolidated  basis for Katy and its  Subsidiaries in conformity
with GAAP;  provided  that there shall be  subtracted  from the sum of items (i)
through (xi) above the amount of any cash expenditure made within the applicable
period  pursuant  to the  SAR,  to the  extent  that  the  amount  of such  cash
expenditure was expensed or will be expensed  against a prior or future period's
Consolidated Net Income; provided, further, that (a) in the event any Loan Party
makes  an  acquisition  of any  Person  or any  division  or any  business  unit
permitted  hereunder or consented to by Majority Lenders during such period,  if
Katy  provides  Agent and  Lenders  financial  statements  with  respect  to the
business so acquired (which financial  statements shall have been audited by one
of the "Big 4" accounting firms or another nationally recognized accounting firm
reasonably  satisfactory to Agent or financial statements otherwise satisfactory
to Agent) reasonably  satisfactory to Majority Lenders,  Consolidated EBITDA for
such period shall be  calculated  on a pro forma basis,  taking into account the
elimination  of  non-recurring  expenses,  based on the results of such acquired
Person or acquired  assets as if such  acquisition had occurred on the first day
of  such  period,  and  (b) in the  event  any  Loan  Party  makes  a  Permitted
Disposition  (or any other  disposition  of any  Person or any  division  or any
business  unit  permitted  hereunder or  consented  to by the Majority  Lenders)
during such period, Consolidated EBITDA for such period shall be calculated on a
pro forma basis, based on the results of such disposed Person or disposed assets
as if such Permitted Disposition (or such other disposition) had occurred on the
first day of such period.

            Consolidated Fixed Charges,  with respect to any period, the sum of:
(i)  scheduled  principal  payments  required  to be made  during such period in
respect to Indebtedness for Money Borrowed  (including the principal  portion of
Capitalized Lease Obligations),  plus (ii) Consolidated Interest Expense payable
in cash for such period,  all as determined for Borrowers and their Subsidiaries
on a Consolidated basis and in accordance with GAAP.

                              Exhibit 7.3 - Page 1
<PAGE>

            Consolidated  Interest  Expense  - for any  period,  total  interest
expense of Katy and its Subsidiaries on a consolidated basis with respect to all
outstanding  Indebtedness  of Katy  and  its  Subsidiaries,  including,  without
limitation,  net costs under Interest Rate Agreements,  but excluding,  however,
(i) any amounts referred to in the Fee Letter or amortization  thereof, (ii) any
deferred financing fees or amortization  thereof,  (iii) commissions,  discounts
and other fees and charges  owed with  respect to letters of credit and bankers'
acceptance financing, (iv) unused line charges, (v) non-cash charges included in
interest  expense  other  than in  clauses  (i) and (ii) and (vi) to the  extent
included in interest expense, costs associated with the unsuccessful second lien
financing abandoned prior to the Closing Date.

            Consolidated Net Income, for any period, the net income (or loss) of
Katy on a Consolidated basis for such period taken as a single accounting period
determined  in conformity  with GAAP;  provided that there shall be excluded (i)
the income (or loss) of any Person  (other than a  Subsidiary  of Katy) in which
any  other  Person  (other  than  Katy or any of its  Subsidiaries)  has a joint
interest, except to the extent of the amount of dividends or other distributions
actually  paid to Katy or any of its  Subsidiaries  by such  Person  during such
period,  (ii) the income (or loss) of any  Person  accrued  prior to the date it
becomes a Subsidiary of Katy or is merged into or consolidated  with Katy or any
of its  Subsidiaries  or that Person's assets are acquired by Katy or any of its
Subsidiaries,  (iii) the income of any Subsidiary of Katy to the extent that the
declaration or payment of dividends or similar  distributions by that Subsidiary
of that income is not at the time  permitted  by  operation  of the terms of its
charter or any agreement,  instrument, judgment, decree, order, statute, rule or
governmental regulation applicable to that Subsidiary,  (iv) any after-tax gains
or losses  attributable to Asset Sales or returned surplus assets of any Pension
Plan, (v) any LIFO reserves of CCP to the extent such LIFO reserves  decrease or
increase net income of CCP, and (vii) (to the extent not included in clauses (i)
through (v) above) any net extraordinary gains or net extraordinary losses.

            Fixed Charge Coverage Ratio,  with respect to any period,  the ratio
of (i) Consolidated EBITDA for such period minus the sum of (a) any income taxes
paid in cash during such period and  restructuring  payments  made in cash after
the Closing Date during such period plus (b) non-financed  Capital  Expenditures
during such period, to (ii) Consolidated  Fixed Charges for such period,  all as
determined for Borrowers and their  Subsidiaries on a Consolidated  basis and in
accordance with GAAP.

            A.  Fixed  Charge  Coverage  Ratio.  Katy shall not permit the Fixed
Charge  Coverage  Ratio for any period set forth below to be less than the ratio
set forth below opposite such period:

                             Period                              Ratio
                             ------                              -----

           Four Fiscal Quarters Ending March 31, 2006          1.10 to 1
           and each June 30, September 30, December 31
           and March 31 thereafter

                              Exhibit 7.3 - Page 2
<PAGE>

      The  foregoing  notwithstanding,  Agent,  Borrowers and Lenders agree that
this  financial  covenant  (Fixed Charge  Coverage  Ratio) shall not be measured
until  Borrowers  have  delivered to Agent  financial  statements for the period
ending  March 31,  2006 in  compliance  with  subsection  7.1.3(ii)  of the Loan
Agreement.

                              Exhibit 7.3 - Page 3

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