Document:

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                                                                     Exhibit 4.8

                                PLEDGE AGREEMENT

                  THIS PLEDGE AGREEMENT (this "AGREEMENT") is made as of October
4, 2000, between Unifrax Holding Co., a Delaware corporation ("HOLDINGS"), and
Societe Europeenne de Produits Refractaires, a French corporation ("SEPR").

             A. Holdings has executed that certain Limited Recourse Promissory
Note, dated the date hereof, in the original principal amount of $20,200,000 in
favor of SEPR (the "HOLDINGS NOTE") and that certain Limited Recourse Promissory
Note, dated the date hereof, in the original principal amount of $300,000 in
favor of Carborundum do Brasil (the "BRASIL NOTE", and together with the
Holdings Note, the "NOTES") as partial consideration for the transactions
contemplated by that certain Stock and Asset Purchase Agreement by and among
SEPR, Unifrax Corporation (the "CORPORATION"), and certain other parties thereto
dated July 27, 2000 (the "PURCHASE AGREEMENT"); and

             B. As a consequence of the transactions contemplated by the
Purchase Agreement, Holdings has acquired 20,500 shares of Series A Preferred
Stock (the "SHARES") of the Corporation, and desires to pledge the Shares to
SEPR as security for the Notes.

                  NOW, THEREFORE, in consideration of the premises contained
herein and other good and valuable consideration the receipt and sufficiency of
which are hereby acknowledged, Holdings and SEPR hereby agree as follows:

                  1. PLEDGE. Holdings hereby pledges to SEPR, and grants to SEPR
a security interest in, the Shares (together with such other securities or
property as become subject to the pledge hereunder pursuant to the terms hereof,
the "PLEDGED SHARES") as security for the prompt and complete payment when due
of the unpaid principal of and interest on the Notes and full payment and
performance of the obligations and liabilities of Holdings hereunder.

                  2. DELIVERY OF PLEDGED SHARES. Upon the execution of this
Agreement, Holdings shall deliver to SEPR the certificates representing the
Pledged Shares and a duly executed irrevocable stock power in the form set forth
at EXHIBIT A.

                  3. VOTING RIGHTS; CASH DIVIDENDS. Notwithstanding anything to
the contrary contained herein, during the term of this Agreement until such time
as there exists an Event of Default (as defined below), Holdings is entitled to
all voting rights with respect to the Pledged Shares and is entitled to receive
all cash dividends declared or paid in respect of the Pledged Shares; provided
that no vote shall be cast or any consent, waiver or ratification given or any
action taken which would, in any material respect, violate or be inconsistent
with any of the terms of this Agreement, or the Notes, or which would have the
effect of impairing, in any material respect, the position or interests of SEPR.
If an Event of Default shall occur and be continuing, all rights of Holdings to
vote and to give consents, waivers and ratifications shall cease and SEPR shall
have all such rights. In accepting the pledge of the Pledged Shares hereunder,
SEPR agrees to abide by and honor all of the terms and provisions of the Pledged

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Shares, including all such terms and provisions set forth in the Corporation's
Certificate of Amendment of the Certificate of Incorporation, dated October 4,
2000.

                  4. STOCK DIVIDENDS; DISTRIBUTIONS, ETC. If Holdings becomes
entitled to receive or receives any securities or other property (other than
cash) with respect to, in substitution of, or in exchange for, any of the
Pledged Shares (whether as a distribution in connection with any
recapitalization, reorganization or reclassification, a stock dividend or
otherwise), Holdings shall accept such securities or other property on behalf of
and for the benefit of SEPR as additional security for Holdings' obligations
under the Notes and shall promptly deliver such additional security to SEPR
together with a duly executed irrevocable stock power, and such additional
security will be deemed to be part of the Pledged Shares hereunder.

                  5. DEFAULT.

                  (a) In the event that any Event of Default (as defined below)
         occurs under either of the Notes and is continuing, SEPR will be
         entitled to exercise all of the rights, powers and remedies (whether
         vested in it by this Agreement or by law) for the protection and
         enforcement of its rights in respect of the Pledged Shares, including
         without limitation, to exercise the following rights, which Holdings
         hereby acknowledges are commercially reasonable:

                           (i) to receive all amounts payable in respect of the
                  Pledged Shares otherwise payable to Holdings;

                           (ii) to transfer all or any part of the Pledged
                  Shares into SEPR's name or the name of its nominee or
                  nominees;

                           (iii) to vote all or any part of the Pledged Shares
                  (whether or not transferred into the name of SEPR) and give
                  all consents, waivers and ratifications in respect of the
                  Pledged Shares and otherwise act with respect thereto as
                  though it were the outright owner thereof (Holdings hereby
                  irrevocably constituting and appointing SEPR the proxy and
                  attorney-in-fact of Holdings, with full power of substitution
                  to do so); and

                           (iv) to the fullest extent permitted by law, at any
                  time or from time to time, to sell, assign and deliver, or
                  grant options to purchase, all or any part of the Pledged
                  Shares, or any interest therein, at any public or private
                  sale, without demand of performance, advertisement or notice
                  of intention to sell or of the time or place of sale or
                  adjournment thereof or to redeem or otherwise dispose of or
                  realize on (all of which are hereby waived by Holdings) for
                  cash, on credit or for other property, for immediate or future
                  delivery without any assumption of credit risk, and for such
                  price or prices and on such terms as SEPR in its absolute
                  discretion may determine. Holdings agrees that each purchaser
                  at any such sale shall hold the property so sold absolutely
                  free from any claim or right on the part of Holdings, and
                  Holdings hereby waives and releases to the fullest extent
                  permitted by law any right of redemption with respect to the
                  Pledged Shares,

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                  whether before or after sale hereunder, and all rights, if
                  any, of marshaling the Pledged Shares and all rights, if any,
                  of stay and/or appraisal that it now has or may at any time in
                  the future have under rule of law or statute now existing or
                  hereafter enacted.

                  (b) Upon completion of foreclosure on the Pledged Shares in
         accordance with the Uniform Commercial Code of Delaware, (i) the Notes
         will be cancelled and be of no further force and effect, (ii) SEPR and
         Carborundum do Brasil shall deliver to Holdings such canceled Notes,
         and (iii) SEPR shall execute a signature page to the Stockholders
         Agreement, by and among the Corporation and its stockholders and by
         virtue of such signature shall agree to be bound by the terms of such
         agreement.

                  (c) The term "Event of Default" as used in this Agreement has
         the meaning set forth in the Notes and further includes any act or
         failure to act by Holdings the result of which is that there does not
         exist, or that there ceases to exist, a valid and perfected security
         interest under this Agreement in all or any part of the Pledged Shares.

                  6. UNDERTAKING TO DEFEND. Holdings shall use its reasonable
best efforts to defend SEPR's right, title and security interest in and to the
Pledged Shares and the respective proceeds thereof against the claims and
demands of all persons.

                  7. COSTS AND ATTORNEYS' FEES. All reasonable costs and
reasonable expenses (including reasonable attorneys' fees) incurred in
exercising any right, power or remedy conferred by this Agreement or in the
enforcement thereof, will become part of the indebtedness secured hereunder and
will be paid by Holdings or repaid from the proceeds of the sale of the Pledged
Shares hereunder.

                  8. PAYMENT OF INDEBTEDNESS AND RELEASE OF PLEDGED SHARES. Upon
payment in full of the indebtedness evidenced by the Notes, including all
amounts in respect of principal and interest, this Agreement will terminate and
SEPR shall surrender the Pledged Shares to Holdings together with the
irrevocable stock power.

                  9. NO OTHER LIENS; NO SALES OR TRANSFERS. Holdings hereby
represents and warrants that it has good and valid title to all of the Pledged
Shares, free and clear of all liens, security interests and other encumbrances
(other than security interests or other encumbrances granted pursuant to this
Agreement), and Holdings hereby covenants that until such time as all of the
outstanding principal of and interest on the Notes has been repaid, Holdings
shall not (i) create, incur, assume or suffer to exist any pledge, security
interest, encumbrance, lien or charge of any kind against the Pledged Shares or
Holdings' rights as a holder thereof, other than pursuant to this Agreement, or
(ii) sell or otherwise transfer any Pledged Shares or any interest therein.

                  10. FURTHER ASSURANCES. At any time and from time to time upon
the written request of SEPR, Holdings shall execute and deliver such further
documents (including Uniform Commercial Code financing statements) and take such
further actions as SEPR may reasonably request to evidence, confirm, perfect and
maintain the liens granted or required to be granted to

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 SEPR by this Agreement and the Notes, and shall fully cooperate with SEPR and
perform all additional acts that are necessary to effect the purposes of the
foregoing.

                  11. REPRESENTATIONS AND WARRANTIES. Holdings hereby represents
and warrants to SEPR that on the date hereof:

                  (a) Holdings has the right in and good title to the Pledged
         Shares and has full right, power and authority to pledge the Pledged
         Shares pursuant to this Agreement and to execute, deliver and perform
         its obligations in accordance with the terms of this Agreement, without
         the consent or approval of any other person.

                  (b) SEPR has a valid and enforceable security interest in all
         of the Pledged Shares and a first priority perfected security interest
         in the Pledged Shares.

                  (c) This Agreement has been duly executed and delivered by
         Holdings and constitutes the legal, valid and binding obligation of
         Holdings, enforceable in accordance with its terms, subject to
         applicable bankruptcy, insolvency and similar laws affecting creditors'
         rights generally and to general principles of equity.

                  (d) Neither Holdings' execution, delivery or performance of
         this Agreement or the Notes, nor, subject to the terms and provisions
         of the Subordination Agreement by and among SEPR, the Corporation and
         certain lenders, dated as of October __, 2000, SEPR's exercise of any
         of its rights and remedies with respect to this Agreement or the Notes,
         will violate or conflict with the terms of any agreement to which
         Holdings is a party, or will violate or conflict with any law, rule,
         provision, policy or order applicable to Holdings or the Pledged
         Shares.

                  12. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction will, 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 will not invalidate or render unenforceable
such provision in any other jurisdiction.

                  13. NO WAIVER; CUMULATIVE REMEDIES. SEPR shall not by any act,
delay, omission or otherwise be deemed to have waived any of its rights or
remedies hereunder, and no waiver will be valid unless in writing, signed by
SEPR, and then only to the extent therein set forth. A waiver by SEPR of any
right or remedy hereunder on any one occasion will not be construed as a bar to
any right or remedy which SEPR would otherwise have on any future occasion. No
failure to exercise nor any delay in exercising on the part of SEPR, any right,
power or privilege hereunder will preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The rights and remedies
herein provided are cumulative and may be exercised singly or concurrently, and
are not exclusive of any rights or remedies provided by law.

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                  14. WAIVERS, AMENDMENTS; ASSIGNMENT. None of the terms or
provisions of this Agreement may be waived, altered, modified or amended except
by an instrument in writing, duly executed by the parties hereto. This Agreement
and all obligations of Holdings hereunder, together with the rights and remedies
of SEPR hereunder, inure to the benefit of SEPR and its successors. SEPR shall
not assign, negotiate or otherwise transfer this Agreement or any or all of its
rights under this Agreement to any person or entity without the prior written
consent of Holdings, except to an Affiliate of SEPR.

                  15. GOVERNING LAW. This Agreement is to be governed and
controlled as to interpretation, enforcement, validity, construction, and in all
other respects by the laws, statutes and decisions of the State of New York.

                  16. COUNTERPARTS. This Agreement may be executed in two or
more counterparts (including by facsimile), each of which is deemed to be an
original and all of which taken together constitute one and the same Agreement.

                   [BALANCE OF PAGE INTENTIONALLY LEFT BLANK]

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                  IN WITNESS WHEREOF, this Agreement has been executed as of the
date first above written.

                                             SOCIETE EUROPEENNE DE
                                             PRODUITS REFRACTAIRES

                                        By:    /S/  ROLAND LAZARD
                                             ----------------------------------
                                        Name:  Roland Lazard
                                        Title: Senior Vice President Finance

                                             UNIFRAX HOLDING CO.

                                        By:    /S/  WILLIAM P. KELLY
                                             -----------------------------------
                                        Name:  William P. Kelly
                                        Title: President and CEO

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                                   EXHIBIT A
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                                   EXHIBIT A

                            IRREVOCABLE STOCK POWER
                            -----------------------

      FOR VALUE RECEIVED, Unifrax Holding Co. hereby sells, assigns and
transfers unto _____________ 20,500 shares of Series A preferred stock $0.01 par
values of Unifrax Corporation, a Delaware corporation (the "CORPORATION"),
standing in the name of Unifrax Holding Co. on the books of the Corporation
represented by Certificate No. 1 herewith, and does hereby irrevocably
constitute and appoint ___________ to transfer said stock on the books of said
Corporation and to substitute one or more persons with like full power, hereby
ratifying and confirming all that said agent or substitute or substitutes shall
lawfully do by virtue hereof. This Stock Power is coupled with an interest and
is irrevocable.

Dated: October 4, 2000
                                             UNIFRAX HOLDING Co.

                                             /s/William P. Kelly
                                             -----------------------
                                             By:    William P. Kelly
                                             Title: President

ATTEST:

By: /s/Thomas N. Littman
    -----------------------
Name:  Thomas N. Littman
Title: Assistant Secretary<PAGE>   1
                                                                     Exhibit 4.9

                             SUBORDINATION AGREEMENT

         THIS SUBORDINATION AGREEMENT is made this 5th day of October, 2000, by
SOCIETE EUROPEENNE DE PRODUITS REFRACTAIRES, as agent for those Persons
identified on Schedule I (the "Subordinated Creditor"), and UNIFRAX CORPORATION,
a Delaware corporation (the "Borrower"), in favor of BANK OF AMERICA, N.A., a
national banking association, its successors and assigns (the "Agent"), and the
"Lenders" (as that term is defined in the Credit Agreement which is defined
below) .

                                    RECITALS

         A. The Borrower, the Agent and the Lenders have entered into the Credit
Agreement (as that term is defined below).

         B. Under the terms of the Credit Agreement, the execution and delivery
of this Agreement is a condition precedent to the Lenders' obligation to
continue to make the Loans (as that term is defined in the Credit Agreement) and
extend the Credit Facilities (as that term is defined in the Credit Agreement).

                                   AGREEMENTS

         NOW, THEREFORE, in consideration of the foregoing and to induce the
Agent to enter into the Credit Agreement and to induce the Lenders from time to
time to make, extend or continue loans, credits or other financial
accommodations to the Borrower, the Subordinated Creditor and the Borrower
jointly and severally represent and agree with the Agent and the Lenders as
follows:

                                   ARTICLE I
                                   DEFINITIONS
                                   -----------

         Section 1.1 SPECIFIC DEFINITIONS.

         As used in this Agreement, the terms defined in the preamble and
Recitals hereto shall have the respective meanings specified therein, and the
following terms shall have the following meanings:

         "Bankruptcy Code" means The Bankruptcy Code of 1978, as amended from
time to time (11 U.S.C. Sections 101 et seq.), and any replacement or successor
act that has a substantially similar purpose.

         "Borrower" has the meaning set forth in the initial paragraph to this
Agreement.

         "Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in the State are authorized or required to close.

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         "Collateral" means any and all property, real, personal property or
otherwise, that is subject to Liens that secure the Senior Indebtedness.

         "Credit Agreement" means that certain Credit Agreement dated of even
date herewith, as amended, modified, restated, substituted, extended and renewed
at any time and from time to time, by and among the Borrower, other parties who
may be identified from time to time therein as "Borrowers," the Agent and the
parties who may be identified from time to time therein as "Lenders," and each
of their respective successors and assigns.

          "Default Notice" means (a) a notice from the Agent to the Subordinated
Creditor stating that an Event of Default exists under the Senior Indebtedness
and whether that Event of Default is a payment default or another default, or
(b) a notice from the Subordinated Creditor to the Agent stating that a payment
default exists under the Subordinated Indebtedness.

         "Insolvency Proceeding" means any receivership, conservatorship,
general meeting of creditors, insolvency or bankruptcy proceeding, assignment
for the benefit of creditors, or any proceeding or action by or against the
Borrower for any relief under any bankruptcy or insolvency law or other laws
relating to the relief of debtors, readjustment of indebtedness,
reorganizations, dissolution, liquidation, compositions or extensions, or the
appointment of any receiver, intervenor or conservator of, or trustee, or
similar officer for, the Borrower or any substantial part of its properties or
assets, including, without limitation, proceedings under the Bankruptcy Code, or
under other federal, state or local statute, laws, rules and regulations, all
whether now or hereafter in effect.

         "Lien" means any mortgage, deed of trust, deed to secure debt, grant,
pledge, security interest, assignment, encumbrance, judgment, financing
statement, lien or charge of any kind, whether perfected or unperfected,
avoidable or unavoidable, consensual or non-consensual including, without
limitation, any conditional sale or other title retention agreement, any lease
in the nature thereof, and the filing of or agreement to give any financing
statement under the Uniform Commercial Code of any jurisdiction.

         "Person" means an individual, a corporation, a partnership, a joint
venture, a trust, an unincorporated association, a government or political
subdivision or agency thereof or any other entity.

         "Security" means any security agreement, pledge, pledge agreement,
guaranty agreement, mortgage, deed of trust, deed to secure debt, trust deed,
land trust, indenture, indemnity deed of trust, indemnification agreement,
proceeding IN REM, reimbursement agreement, financing statement, purchase
agreement, conditional sales contract, installment sales contract, collateral
agreement, financing lease, letter of credit, bond, loan agreement,
hypothecation agreement, deposit, financing statement or assignment, and also
means any agreement, document, security device or arrangement, document,
statutory lien, lien arising by operation of law, judgment or other lien, right
of setoff, encumbrance, proceeding or other document or right, in whatever form
or however arising, whether similar or dissimilar to the foregoing which
directly or indirectly secures or enforces payment or performance of any Person
against, or otherwise encumbers or gives notice of an encumbrance upon, the real
property, personal property, rights or assets of any Person.

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         "Senior Credit Agreement" shall mean the Credit Agreement, and any
successor to or replacement of the Credit Agreement (including, without
limitation, any agreement pursuant to which the Borrower issues debt securities
senior to the Subordinated Indebtedness) and all or part of the credit
facilities provided thereunder, as each such successor, replacement or agreement
may from time to time be entered into, amended, renewed, supplemented,
succeeded, replaced, or otherwise modified in accordance with the terms of this
definition.

          "Senior Financing Documents" means the collective reference to each
and every note, instrument, security agreement, pledge agreement, guaranty
agreement, mortgage, deed of trust, indemnity deed of trust, loan agreement,
hypothecation agreement, indemnity agreement, letter of credit application,
assignment, or any other document (whether similar or dissimilar to any of the
foregoing) previously, simultaneously or hereafter executed and delivered by the
Borrower or any other Person, singly or jointly with another Person or Persons,
in connection with any of the Senior Indebtedness, including, without
limitation, the "Loan Documents" as defined in the Credit Agreement, all as
amended, modified, restated, substituted, extended and renewed at any time and
from time to time.

          "Senior Indebtedness" means all indebtedness, liabilities and
obligations of the Borrower under the Senior Credit Agreement of every kind and
nature whatsoever, whether now existing or hereafter arising or created at any
time including, without limitation, the "Obligations" as defined in the Credit
Agreement and, further including, without limitation, such indebtedness,
liabilities and obligations of the Borrower under the Senior Credit Agreement
(a) which are direct, indirect, contingent, primary, secondary, alone, jointly
with others, acquired directly or by assignment, due, to become due, unsecured,
secured, future advances, incurred or assumed, (b) which relate to or arise from
the issuance of letters of credit, overdrafts, other credit facilities, or
guaranties, indemnifications or other similar agreements in favor of third
parties made by the Agent and/or the Lenders at the request or for the benefit
of the Borrower, (c) which are claims of subrogation, indemnification,
reimbursement or contribution of the Agent and/or the Lenders against the
Borrower or any other Person relating in any manner to obligations of the
Borrower or the Security in respect of the indebtedness, liabilities and
obligations included in this definition, (d) which are claims of whatever nature
and whenever arising on account of the avoidance of payments or other transfers
to or for the benefit of the Agent and/or the Lenders in Insolvency Proceedings
or otherwise, or (e) which are claims (including, without limitation, claims
arising or accruing after the commencement of Insolvency Proceedings by or
against the Borrower or any assets of the Borrower, whether or not such claims
are allowed) for principal, interest, expense payments, liquidation costs, and
attorneys' fees and expenses, all of the foregoing whether arising under
contract, by tort, at law, in equity or otherwise.

         "Standstill Period" shall mean any period during which the Borrower is
subject to any Insolvency Proceeding and also any period commencing from the
date of a Default Notice from the Agent and continuing until:

              (a) the Senior Indebtedness is paid and satisfied in full (or
until the default is sooner cured within any applicable grace period or cured
with the unconditional permission of the Agent and the Lenders), if a default
under the Agent's Default Notice is a payment default under the Senior
Indebtedness or is a default arising on account of the

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Subordinated Creditor's receipt of a payment, distribution or other
consideration in violation of this Agreement or the Senior Financing Documents;
or

              (b) in the case of any other default under a Default Notice from
the Agent, 180 days after the Default Notice or the earliest of (i) 180 days
after the Default Notice minus the number of days in all other Standstill
Periods during the 360 day interval preceding the Default Notice, or (ii) the
date on which the Subordinated Creditor receives a notice from the Agent that
the Standstill Period is terminated or (iii) the date on which all such defaults
have been cured or waived with the Agent's unconditional permission; provided
however, that (x) no Standstill Period shall be imposed under this clause (b)
with respect to the same default for a period of ninety (90) days after the last
day of any Standstill Period.

         "State" means the State of Illinois.

         "Subordinated Creditor" shall have the meaning set forth in the initial
paragraph to this Agreement.

         "Subordinated Indebtedness" means any and all existing and future
indebtedness, liabilities and obligations of the Borrower to the Subordinated
Creditor of every kind and nature whatsoever, including, without limitation,
such indebtedness, liabilities, and obligations of the Borrower to the
Subordinated Creditor (a) which are direct, indirect, contingent, primary,
secondary, alone, jointly with others, due, to become due, acquired directly or
by assignment, unsecured, secured, future advances, incurred or assumed, and all
guaranties, indemnifications and other undertakings of Persons other than the
Borrower with respect to the foregoing, (b) which relate to or arise from
guaranties, indemnifications or other similar agreements in favor of third
parties made by the Subordinated Creditor at the request or for the benefit of
the Borrower, including, without limitation, the "Unifrax Guarantees" (as that
term is defined in the Credit Agreement), c) which are claims of
indemnification, reimbursement or contribution of the Subordinated Creditor
against the Borrower or any other Person relating in any manner to obligations
of the Borrower or the Security, (d) which are claims of whatever nature and
whenever arising on account of the avoidance of payments or other transfers to
or for the benefit of the Subordinated Creditor in Insolvency Proceedings or
otherwise, or (e) which are claims (including, without limitation, claims
arising or accruing after the commencement of Insolvency Proceedings by or
against the Borrower or any of the assets of the Borrower, whether or not such
claims are allowed) for interest, expense payments, liquidation costs, and
attorneys' fees and expenses, all of the foregoing whether arising under
contract, by tort, at law, in equity or otherwise.

         "Subordinated Promissory Note" has the meaning set forth in EXHIBIT A
to this Agreement. The indebtedness evidenced by the Subordinated Promissory
Note is part of the Subordinated Indebtedness.

         Section 1.2 Other Definitional Provisions.

         Unless otherwise defined herein, all terms used herein which are
defined by the Illinois Uniform Commercial Code shall have the same meanings as
assigned to them by the Illinois Uniform Commercial Code unless and to the
extent varied by this Agreement. The words "hereof", "herein" and "hereunder"
and words of similar import when used in this Agreement

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<PAGE>   5

shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and section, subsection, schedule and exhibit references are
references to sections or subsections of, or schedules or exhibits to, as the
case may be, this Agreement unless otherwise specified. As used herein, the
singular number shall include the plural, the plural the singular and the use of
the masculine, feminine or neuter gender shall include all genders, as the
context may require. Reference to any one or more of the Senior Financing
Documents and any of the Senior Financing Documents shall mean the same as the
foregoing may from time to time be amended, restated, substituted, extended,
renewed, supplemented or otherwise modified.

                                   ARTICLE II
                                  SUBORDINATION
                                  -------------

         Section 2.1 SUBORDINATED INDEBTEDNESS.

                  2.1.1 SUBORDINATION.

                  Subject to the terms and conditions of this Agreement, the
Subordinated Creditor hereby subordinates and postpones the payment and the time
of payment of all of the Subordinated Indebtedness to and in favor of the
indefeasible and full payment in cash and the time of payment of the Senior
Indebtedness. The Subordinated Creditor and the Borrower represent and warrant
to the Agent and the Lenders that all existing Subordinated Indebtedness is
described in EXHIBIT A attached hereto and made a part hereof.

                  2.1.2 PAYMENTS.

         Until all of the Senior Indebtedness has been fully and indefeasibly
paid in cash and there is no agreement in respect of the Senior Indebtedness
between the Borrower and the Agent and/or the Lenders under which the Agent
and/or the Lenders are required to or may make loans or provide other financial
accommodations, the Subordinated Creditor shall not, without the prior written
consent of the Agent, ask, demand, accelerate, declare a default under, sue for,
set off, accept or receive any payment of all or any part of the Subordinated
Indebtedness; PROVIDED, HOWEVER, that unless a Standstill Period exists, the
Subordinated Creditor may receive and may enforce its right to receive any
payments described in EXHIBIT B attached hereto and made a part hereof. The
Subordinated Creditor agrees that if, during (with the Agent's express written
permission) or within five (5) Business Days following any Standstill Period,
the Borrower pays amounts due or coming due during the Standstill Period or
performs any obligation to the Subordinated Creditor which has given rise to a
default under the Subordinated Indebtedness, the Borrower, by making such
payment or performing such obligation, shall be deemed to have cured and the
Subordinated Creditor to have waived any default under the Subordinated
Indebtedness which may have arisen on account of the failure to make that
payment or perform that obligation earlier.

                  2.1.3 LEGEND ON SUBORDINATED INDEBTEDNESS.

                           The Subordinated Creditor and the Borrower agree and
warrant that any instrument, agreement, security or other writing now or
hereafter evidencing all or any portion of the Subordinated Indebtedness shall
bear on its face a clear and conspicuous legend that it is subject to the terms
of this Agreement. Until all Senior Indebtedness has been indefeasibly paid in
full in cash, the Borrower shall not issue any instrument, security or other
writing (other than

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<PAGE>   6

those, if any, described in EXHIBIT A) evidencing any part of the Subordinated
Indebtedness or amend or modify in any respect any such instrument, security or
other writing except at the request of and in that manner requested by the
Agent.

         Section 2.2 SECURITY.

                  2.2.1 SECURITY FOR SUBORDINATED INDEBTEDNESS.

                  The Subordinated Creditor and the Borrower agree,  represent
and warrant that the Subordinated Indebtedness is not, and shall not be secured
in any way directly or indirectly by any Security.

                  2.2.2 NO ACTION BY SUBORDINATED CREDITOR.

                  Until the Senior Indebtedness has been fully and indefeasibly
paid in cash and there exists no agreement in respect of the Senior Indebtedness
between the Borrower and the Agent and/or the Lenders under which the Lender is
required to or may make loans or provide other financial accommodations, the
Subordinated Creditor shall not, without the prior written consent of the Agent,
ask, demand, assign, declare a default under, accelerate, sue for, liquidate,
sell, foreclose, set off, collect, accept a surrender, receive any proceeds,
petition, commence or otherwise initiate any Insolvency Proceedings (or join any
other Person in so doing) against the Borrower or its assets, commence any
action or proceeding to contest the provisions of this Agreement or the priority
of the Lien or other interest of the Agent and/or the Lenders in the Security,
or otherwise realize or seek to realize upon all or any part of the Security;
PROVIDED, HOWEVER, that, except during a Standstill Period, the Subordinated
Creditor may receive and may enforce its right to receive any payments described
in EXHIBIT B attached hereto and made a part hereof.

                  2.2.3 PROVISIONS WITH RESPECT TO LIENS.

                  The following shall govern any Lien in favor of the
Subordinated Creditor or any Security for the Subordinated Obligations,
provided, however, that nothing in this Section 2.2.3 shall be deemed to consent
to any such Lien or Security:

                           (a) The Subordinated Creditor hereby subordinates the
lien and priority of the Subordinated Creditor's existing and future Liens and
other interests, if any, in and to the Collateral to the existing and future
interest of the Agent and/or the Lenders in the Collateral notwithstanding the
time of attachment of the interests of the Agent and/or the Lenders or the
Subordinated Creditor or the time the Senior Indebtedness or the Subordinated
Indebtedness is incurred. Notwithstanding anything to the contrary contained in
this Agreement, under applicable law or otherwise, in the event that the Liens
of the Agent and/or the Lenders are at any time unperfected with respect to any
or all of the Collateral, the lack of perfection by the Agent and/or the Lenders
as to any such Collateral shall not affect the validity, enforceability or
priority of any Lien on the Collateral in favor of the Subordinated Creditor. In
any such event, the Liens of the Subordinated Creditor shall have priority over
any and all other Liens in favor of any third party with respect to the
Collateral (including, but not limited to any trustee under the Bankruptcy
Code), and the Agent and the Lenders hereby appoint and constitute the
Subordinated Creditor as their agent and bailee for purposes of perfection of
the Liens of the Agent and the Lenders in the Collateral such that the Lien in
favor of the Subordinated Creditor

                                      -6-
<PAGE>   7

shall be held by the Subordinated Creditor for the benefit of the Agent and the
Lenders and the proceeds of any disposition of the Collateral shall be and are
in all respects subject to the priority of right to payment and satisfaction of
first, the Senior Indebtedness and then, the Subordinated Indebtedness. The lien
priorities provided in this Section shall not be altered or otherwise affected
by any amendment, modification, supplement, extension, renewal, restatement or
refinancing of either the Senior Indebtedness or the Subordinated Indebtedness,
nor by any action or inaction which the Agent and/or the Lenders or the
Subordinated Creditor may take or fail to take in respect of the Collateral,
except as otherwise provided above in this subsection.

                           (b) In the event the Agent and/or the Lenders may
from time to time execute releases, partial releases, terminations,
reconveyances, subordinations or other documents releasing or otherwise limiting
the interests of the Agent and/or the Lenders in the Collateral, the
Subordinated Creditor agrees to execute and deliver at the same time such
further documents as the Agent may require to effect a corresponding change to
the Subordinated Creditor's position in the same Collateral.

                           (c) The Agent on behalf of the Agent and/or the
Lenders shall have the exclusive right to exercise and enforce all privileges
and rights with respect to the Collateral according to the Agent's discretion
and the exercise of the Agent's business judgment, including, without
limitation, the exclusive right to take or retake control or possession of such
Collateral and to hold, prepare for sale, process, sell, lease, dispose of, or
liquidate such Collateral.

                           (d) Only the Agent shall have the right to restrict
or permit, or approve or disapprove, the sale, transfer or other disposition of
Collateral. The Subordinated Creditor will, immediately upon the request of the
Agent, release or otherwise terminate the Subordinated Creditor's Liens upon the
Collateral. The Subordinated Creditor will immediately deliver such releases,
acknowledgements and other documents as the Agent may require in connection
therewith.

         Section 2.3 FURTHER REPRESENTATIONS AND WARRANTIES.

         The Subordinated Creditor represents and warrants to the Agent and the
Lenders that:

                           (a) the Subordinated Creditor is the exclusive legal
         and beneficial owner of the Subordinated Indebtedness and no part
         thereof has been assigned to or subordinated or subjected to any other
         security interest in favor of anyone other than the Agent and/or the
         Lenders;

                           (b) true, correct and complete copies of all
         documents relating to the Subordinated Indebtedness in effect as of the
         date hereof have been furnished to the Agent;

                           (c) the execution, delivery and performance of this
         Agreement is within the corporate powers of the Subordinated Creditor,
         has been duly authorized by all necessary corporate action of the
         Subordinated Creditor, and does not contravene any law, any provision
         of the certificate of incorporation or the by-laws of the Subordinated
         Creditor or any agreement to, or any law, rule,

                                      -7-
<PAGE>   8

         order or regulation, which the Subordinated Creditor is a party or by
         which it or its properties are bound; and

                           (d) this Agreement has been properly executed and
         delivered and constitutes the valid and legally binding obligations of
         the Subordinated Creditor and is fully enforceable against the
         Subordinated Creditor in accordance with its terms.

         Section 2.4 FURTHER DOCUMENTS.

         The Subordinated Creditor and the Borrower agree they shall promptly
execute such further documents and acknowledgements (including, without
limitation, amendments to and releases of financing statements and other
documents of record) as the Agent may reasonably require to confirm or evidence
their respective obligations and the Agent's rights under this Agreement.

                                  ARTICLE III
                           DISTRIBUTIONS AND RECEIPTS
                           --------------------------

         Section 3.1 DISTRIBUTIONS, ETC.

                  3.1.1 APPLICATION OF PROCEEDS.

                  In the event of any distribution, division or application,
partial or complete, voluntary or involuntary, by operation of law or otherwise,
of all or any part of the assets of the Borrower or the proceeds thereof to
creditors of the Borrower or to any indebtedness, liabilities and obligations of
the Borrower, by reason of the liquidation, dissolution or other winding up of
the Borrower or Borrower's business, or in the event of any sale or Insolvency
Proceedings with respect to the Borrower or its assets, then in any such event,
any payment, distribution or benefit of any kind whatsoever or character, either
in cash, securities or other property, whether or not on account of the
Security, which shall be payable, deliverable or receivable upon or with respect
to all or any part of the Subordinated Indebtedness shall be paid or delivered
directly to the Agent for application to the Senior Indebtedness (whether due or
not due and in such order and manner as the Agent may elect; and including,
without limitation any interest accruing subsequent to the commencement of any
such event or Insolvency Proceedings) until the Senior Indebtedness shall have
been fully and indefeasibly paid in cash and satisfied.

                  3.1.2 INSOLVENCY PROCEEDINGS.

                  In connection with any Insolvency Proceedings, the
Subordinated Creditor hereby irrevocably authorizes and empowers the Agent, and
irrevocably appoints the Agent the Subordinated Creditor's attorney-in-fact to
take any of the following actions if the Subordinated Creditor has failed to
take such actions within 10 days prior to any deadline therefor (a) demand, sue
for, collect and receive every such payment or distribution and give acquittance
therefor, (b) enforce claims comprising Subordinated Indebtedness in the name of
the Agent, or the name of the Subordinated Creditor, by proof of debt, proof of
claim, suit or otherwise; (c) collect any assets of the Borrower distributed,
dividend or applied by way of dividend or payment, or any such securities
issued, on account of Subordinated Indebtedness and apply the same, or the
proceeds of any realization upon the same, to Senior Indebtedness (whether due
or not due in

                                      -8-
<PAGE>   9

such order and manner as the Agent may elect) until all Senior Indebtedness,
shall have been indefeasibly paid in full in cash; (d) vote claims compromising
Subordinated Indebtedness to accept or reject any plan of partial or complete
liquidation, reorganization, arrangement, composition or extension; (e) take
generally any action which the Subordinated Creditor might otherwise take; and
(f) take such other actions in the Agent's own name or in the name of the
Subordinated Creditor or otherwise, as the Agent may reasonably deem necessary
or advisable to carry out the provisions of this Agreement.

                  3.1.3 EXECUTION OF ADDITIONAL DOCUMENTS.

                  The Subordinated Creditor hereby agrees to execute and deliver
to the Agent such powers of attorney, notices, assignments, endorsements,
releases, other documents or other instruments as may be reasonably requested by
the Agent in order to enable the Agent to enforce any and all claims upon or
with respect to the Subordinated Indebtedness and/or the Security, and to
collect and receive any and all payments or distributions which may be payable
or deliverable at any time upon or with respect to the Subordinated Indebtedness
and/or the Security.

         Section 3.2 RECEIPTS BY SUBORDINATED CREDITOR.

         Should any payment or distribution not permitted by the provisions of
this Agreement or property or proceeds thereof be received by the Subordinated
Creditor upon or with respect to all or any part of the Subordinated
Indebtedness and/or the Security prior to the full payment and satisfaction of
the Senior Indebtedness, the Subordinated Creditor will immediately deliver the
same to the Agent in precisely the form received (except for the endorsement or
assignment of the Subordinated Creditor when the Agent reasonably deems
appropriate), for application to the Senior Indebtedness (whether or not any
amount is then due and in such order and manner as the Senior Credit Agreement
may require or, absent such a requirement, as the Agent may elect), and, until
so delivered, the same shall be held in trust by the Subordinated Creditor as
property of the Agent on behalf of the Agent and the Lenders. In the event of
the failure of the Subordinated Creditor to make any such endorsement or
assignment, the Agent, or any of its officers or employees on behalf of the
Agent, is hereby irrevocably authorized in its own name or in the name of the
Subordinated Creditor to make the same, and is hereby appointed the Subordinated
Creditor's attorney-in-fact for those purposes, that appointment being coupled
with an interest and irrevocable.

                                   ARTICLE IV
                              ADDITIONAL AGREEMENTS
                              ---------------------

         Section 4.1 CONSENTS, WAIVERS, ETC.

         The Subordinated Creditor hereby consents that at any time and from
time to time and with or without consideration, the Agent and/or the Lenders
may, without further consent of or notice to the Subordinated Creditor and
without in any manner affecting, impairing, lessening or releasing any of the
provisions of this Agreement, renew, extend, change the manner, time, place and
terms of payment of, sell, exchange, release, substitute, surrender, realize
upon, modify, waive, grant indulgences with respect to and otherwise deal with
in any manner: (a) all or any part of the Senior Indebtedness; (b) all or any of
the Senior Financing Documents; (c) all or any

                                      -9-
<PAGE>   10

part of any property at any time included within the Collateral; and (d) any
Person at any time primarily or secondarily liable for all or any part of the
Senior Indebtedness and/or any collateral and security therefor, all as if this
Subordination Agreement and any interest which the Subordinated Creditor has in
the Collateral did not exist; provided, however, that nothing in this Section
4.1 shall be deemed to consent to any expansion of the scope of the Senior
Indebtedness.

         Section 4.2 CONTINUING AGREEMENT.

         This is a continuing Subordination Agreement until all of the Senior
Indebtedness has been fully and indefeasibly paid in cash, until all of the
Senior Indebtedness and all of the Subordinated Creditor's obligations to the
Agent and the Lenders have been performed and satisfied, until the Agent and the
Lenders have no obligation or agreement to allow further Senior Indebtedness.
Without implying any limitation on the foregoing, if at any time any payment or
assets distributed or paid over, or portion thereof, made by, or for the account
of, the Borrower, by the Subordinated Creditor or otherwise on account of any of
the Senior Indebtedness is set aside by any court or trustee having jurisdiction
as a voidable preference or fraudulent conveyance or must otherwise be restored
or returned by the Agent and/or the Lenders to the Borrower or any other Person
under any Insolvency Proceedings or otherwise, the Subordinated Creditor and the
Borrower hereby agree that this Agreement shall continue and remain in full
force and effect or be reinstated, as the case may be, all as though any such
payment had not been made and this Agreement had at all times remained in
effect.

         Section 4.3 NO THIRD PARTY BENEFICIARIES.

         The provisions of this Agreement are solely for the benefit of the
Agent and the Lenders, other holders or obligees under the Senior Indebtedness,
and their respective successors and assigns under the Senior Credit Agreement,
and there are no other parties or Persons whatsoever (including, without
limitation, the Borrower and its successors and assigns) who are intended to be
benefited in any manner whatsoever by this Agreement.

         Section 4.4 TRANSFERS BY SUBORDINATED CREDITOR.

         The Subordinated Creditor agrees not to subordinate, assign or transfer
all or any part of the Subordinated Indebtedness or the Security to any Person
other than the Agent and the Lenders without the prior written consent of the
Agent.

         Section 4.5 TRANSFER OR ASSIGNMENT OF SENIOR INDEBTEDNESS.

         If any of the Senior Indebtedness should be transferred or assigned by
the Agent and/or the Lenders, this Agreement will inure to the benefit of the
transferee or assignee of the Agent and/or the Lenders to the extent of such
transfer or assignment, provided that the Agent and/or the Lenders shall
continue to have the unimpaired right to enforce this Agreement as to any of the
Senior Indebtedness not so transferred or assigned.

         Section 4.6 ACTIONS UPON BREACH.

                  4.6.1 BORROWER'S DEFENSE.

                  If the Subordinated Creditor, in violation of this Agreement,
commences or participates in any action or proceeding against the Borrower or
the Security, the Borrower may interpose as a defense or dilatory plea the
making of this Agreement, and the Agent may

                                      -10-
<PAGE>   11

intervene and interpose such defense or plea in the name of the Agent and/or the
Lenders or in the name of the Borrower. Should the Subordinated Creditor, in
violation of this Agreement, in any way attempt to enforce payment of the
Subordinated Indebtedness or any part thereof or to realize upon the Collateral
or any part thereof, either the Agent (in the name of the Agent and/or the
Lenders or in the name of the Borrower), the Borrower itself, or the Agent and
the Borrower, may restrain the Subordinated Creditor from so doing, it being
understood and agreed by the Subordinated Creditor that (a) the damages of the
Agent and/or the Lenders and/or the Borrower from the Subordinated Creditor's
actions may at that time be difficult to ascertain and may be irreparable, and
(b) the Subordinated Creditor waives any defense that the Borrower and/or that
the Agent and/or the Lenders cannot demonstrate damage and/or can be made whole
by the awarding of damages. The Subordinated Creditor hereby irrevocably
authorizes and empowers the Lender, and irrevocably appoints the Agent the
Subordinated Creditor's attorney-in-fact for the purpose of executing and
delivering such assignments, endorsements, releases, other instruments and other
documents which the Subordinated Creditor is or may be required to execute and
deliver under the terms of this Agreement.

                  4.6.2 EQUITABLE RELIEF FOR AGENT AND THE LENDERS.

                  If any one or more of the Subordinated Creditor or the
Borrower contrary to this Agreement, makes, attempts to or threatens to make or
receive any payment, take any action with respect to the Security or take any
action contrary to this Agreement, or fails to take any action required by this
Agreement, the Agent and/or the Lenders may obtain relief by injunction,
specific performance and/or other appropriate equitable relief, it being
understood and agreed by the Subordinated Creditor and the Borrower that (a) the
damages of the Agent and/or the Lenders from the actions of the Subordinated
Creditor may at that time be difficult to ascertain and may be irreparable and
(b) the Subordinated Creditor and the Borrower waive any defense or claim that
the Borrower and/or the Agent and/or the Lenders cannot demonstrate damage
and/or can be made whole by the awarding of damages.

                  4.6.3 COSTS AND EXPENSES.

                  The Subordinated Creditor and the Borrower agree to indemnify
the Agent and the Lenders and to hold the Agent and the Lenders harmless for any
and all reasonable costs and expenses (including, without limitation, reasonable
attorney's fees) as they arise, relating to actions of the Subordinated Creditor
or the Borrower taken contrary to this Agreement.

         Section 4.7 STATEMENT OF DEBT.

         The Subordinated Creditor and the Borrower will, at any time or times
upon the reasonable request of the Agent, promptly furnish to the Agent a true,
correct and complete statement of the outstanding Subordinated Indebtedness.

         Section 4.8 SUBROGATION; MARSHALLING.

         The Subordinated Creditor shall not be subrogated to, or be entitled to
any assignment of any Senior Indebtedness or evidence of the Senior Indebtedness
or any Security until all Senior Indebtedness is indefeasibly paid and satisfied
in full. The Subordinated Creditor hereby waives any and all rights to have any
Security or any part thereof granted to the Agent and/or the

                                      -11-
<PAGE>   12

Lenders marshaled in any Insolvency Proceedings or upon any foreclosure or other
disposition of such Collateral by the Agent and/or the Lenders or otherwise.

         Section 4.9 BANKRUPTCY FINANCING.

         If the Borrower shall become subject to a proceeding under the
Bankruptcy Code and if the Agent desires to permit the use of cash collateral
and/or to provide financing to such the Borrower under either Section 363 or
Section 364 of the Bankruptcy Code, the Subordinated Creditor agrees as follows:
(a) adequate notice to the Subordinated Creditor shall be deemed to have been
given to Subordinated Creditor if the Subordinated Creditor receives notice
three (3) business days prior to the entry of the order approving such
financing, and (b) no objection will be raised by the Subordinated Creditor to
any such financing on the ground of a failure to provide "adequate protection"
for the Subordinated Creditor's junior lien on the Collateral or any other
grounds, provided the Subordinated Creditor retains a lien on and security
interest in the post-petition Collateral to the extent and with the same
priority as existed prior to the commencement of the proceeding under the
Bankruptcy Code. For purposes of this Section, notice of a proposed financing or
use of cash collateral shall be deemed given when given, in the manner
prescribed by this Agreement, to the Subordinated Creditor or its counsel.

                                   ARTICLE V
                                  MISCELLANEOUS
                                  -------------

         Section 5.1 NOTICES.

         All notices, requests and demands to or upon the parties to this
Agreement shall be in writing and shall be deemed to have been given or made
when delivered by hand on a Business Day, or two (2) days after the date when
deposited in the mail, postage prepaid by registered or certified mail, return
receipt requested, or when sent by overnight courier, on the Business Day next
following the day on which the notice is delivered to such overnight courier,
addressed as follows:

                  Borrower:         Unifrax Corporation
                                    2351 Whirlpool Street
                                    Niagara Falls, New York  14305-2413
                                    Attention: Mark D. Roos

                                    with copies to:

                                    Charles W. Hardin, Jr., Esquire
                                    Jones, Day, Reavis & Pogue
                                    North Point
                                    901 Lakeside Avenue
                                    Cleveland, Ohio  44114

                                      -12-
<PAGE>   13

                  Agent
                  and Lenders:      Bank of America, N.A.
                                    231 South LaSalle Street
                                    Chicago, Illinois 60697
                                    Attention: Business Credit-Account Executive
                                    Telecopy No.: (312) 974-8760

                                    with copies to:

                                    Frederick W. Runge, Jr., Esquire
                                    Miles & Stockbridge P.C.
                                    10 Light Street
                                    Baltimore, Maryland  21202

                  Subordinated      SEPR
                  Creditor:         Les Miroirs, 18 Boulevard D'Alsace
                                    92096, La Defense
                                    Attention:  Marie-Armelle Chupin
                                    Telecopy:  No. 33.1.4762.3683

         By written notice, each party to this Agreement may change the address
to which notice is given to that party, provided that such changed notice shall
include a street address to which notices may be delivered by overnight courier
in the ordinary course on any Business Day.

         Section 5.2       ADDITIONAL SENIOR INDEBTEDNESS.

         Nothing herein contained shall obligate the Agent and/or the Lenders to
grant credit to, or continue financing arrangements with, the Borrower.

         Section 5.3       DELAY IN ENFORCEMENT, ETC.

         No delay or failure on the part of the Agent and/or the Lenders to
exercise any of its rights or remedies hereunder or now or hereafter existing at
law or in equity or by statute or otherwise, or any partial or single exercise
thereof, shall constitute a waiver thereof. All such rights and remedies are
cumulative and may be exercised singly or concurrently and the exercise of any
one or more of them will not be a waiver of any other. No modification to or
waiver of any of the rights and remedies of the Agent and/or the Lenders under
this Agreement or otherwise, and no modification or amendment of this Agreement,
shall be deemed to be made by the Agent and/or the Lenders unless the same shall
be in writing, duly signed on behalf of the Agent and/or the Lenders, and each
such waiver, if any, shall apply only with respect to the specific instance
involved and shall in no way impair the rights and remedies of the Agent and/or
the Lenders hereunder in any other respect at any other time. Without limiting
the generality of the foregoing, the Agent may proceed against the Borrower with
or without proceeding against any guarantor, surety, indemnitor or any other
Person who may be liable for all or any part of the

                                      -13-
<PAGE>   14

Obligations, may proceed against all or any part of the Security, or may refrain
taking all or any such action without affecting the agreements and obligations
of the parties to this Agreement.

         Section 5.4 SUCCESSORS AND ASSIGNS.

         This Agreement shall be binding upon the Subordinated Creditor and the
Borrower and the Subordinated Creditor's and the Borrower's successors and
assigns and shall inure to the benefit of the Agent and the Lenders and their
respective successors and assigns, and other holders of or obligees under the
Senior Indebtedness.

         Section 5.5 HEADINGS.

         The paragraph headings of this Agreement are for convenience only, and
shall not limit or otherwise affect any of the terms hereof.

         Section 5.6 APPLICABLE LAW; JURISDICTION.

                  5.6.1 APPLICABLE LAW.

                  The parties to this Agreement acknowledge and agree that this
Agreement shall be governed by the laws of the State, as if this Agreement had
been executed, delivered, administered and performed solely within the State
even though for the convenience and at the request of the Subordinated Creditor
or the Borrower, this Agreement may be executed elsewhere.

                  5.6.2 SUBMISSION TO JURISDICTION.

                  The parties to this Agreement irrevocably submit to the
jurisdiction of any state or federal court sitting in the State over any suit,
action or proceeding arising out of or relating to this Agreement or any of the
other Senior Financing Documents. The parties to this Agreement irrevocably
waive, to the fullest extent permitted by law, any objection that either of them
may now or hereafter have to the laying of the venue of any such suit, action or
proceeding brought in any such court and any claim that any such suit, action or
proceeding brought in any such court has been brought in an inconvenient forum.
Final judgment in any such suit, action or proceeding brought in any such court
shall be conclusive and binding and may be enforced in any court in which the
applicable party is subject to jurisdiction, by a suit upon such judgment,
provided that service of process is effected upon the applicable party in one of
the manners specified in this Section or as otherwise permitted by applicable
laws.

                                      -14-
<PAGE>   15

                  5.6.3 APPOINTMENT OF AGENT FOR SERVICE OF PROCESS.

                  The Subordinated Creditor and the Borrower hereby,
individually, irrevocably designate and appoint The Corporation Trust
Incorporated, Baltimore, Maryland, as its authorized agent to receive on its
behalf service of any and all process that may be served in any suit, action or
proceeding of the nature referred to in this Section in any state or federal
court sitting in the State. If such agent shall cease so to act, the
Subordinated Creditor or the Borrower, as the case may be, shall irrevocably
designate and appoint without delay another such agent in the State satisfactory
to the Agent and shall promptly deliver to the Agent evidence in writing of such
other agent's acceptance of such appointment and its agreement that such
appointment shall be irrevocable.

                  5.6.4 SERVICE OF PROCESS.

                  The parties to this Agreement hereby consent to process being
served in any suit, action or proceeding of the nature referred to in this
Section by (a) the mailing of a copy thereof by registered or certified mail,
postage prepaid, return receipt requested, at the address designated in or
pursuant to Section 5.1 (Notices), and (b) serving a copy thereof upon the
agent, if any, designated and appointed as agent for service of process by or
pursuant to this Section. The parties to this Agreement irrevocably agree that
such service (y) shall be deemed in every respect effective service of process
in any such suit, action or proceeding, and (z) shall, to the fullest extent
permitted by law, be taken and held to be valid personal service. Nothing in
this Section shall affect the right of the Agent to serve process in any manner
otherwise permitted by law or limit the right of the Agent otherwise to bring
proceedings against the Subordinate Creditor or the Borrower, as the case may
be, in the courts of any jurisdiction or jurisdictions.

         IN WITNESS THEREOF, the signatures and seals of the Subordinated
Creditor and of the Borrower are subscribed to this Agreement as of the date
first written above.

<TABLE>
<CAPTION>
WITNESS/ATTEST:                                      SOCIETE EUROPEENNE DE PRODUITS REFRACTAIRES, Agent
                                                     (Subordinated Creditor)

<S>                                                  <C>
/s/ Alain Coupaye                                    By: /s/ Roland Lazard       (SEAL)
---------------------------                              -----------------------
                                                          Roland Lazard
                                                          Attorney-in-Fact

WITNESS/ATTEST:                                      UNIFRAX CORPORATION
                                                     (Borrower)

/s/ Paul J. Viola                                    By:  /s/ Mark D. Roos       (SEAL)
---------------------------                              -----------------------
 Paul J. Viola                                            Mark D. Roos
                                                          Vice President
</TABLE>

                                      -15-
<PAGE>   16

                                                                       EXHIBIT A

                            SUBORDINATED INDEBTEDNESS
                            -------------------------

Subordinated Promissory Note dated October 4, 2000, from the Borrower to the
Subordinated Creditor in the original principal amount of Eight Million Dollars
($8,000,000) and as may be increased on each anniversary of the date of that
Subordinated Promissory Note commencing on the first anniversary thereof, by an
amount up to Four Million Dollars ($4,000,000) as long as the Borrower would be
permitted to issue to the Subordinated Creditor at such time a guaranty in such
amount of the Holdings Note under the terms of the Senior Indenture; provided
that notwithstanding the foregoing, the aggregate principal amount of the
Subordinated Note - Subordinated Creditor will (a) cease to so increase at such
time as the Holdings Note shall have been paid in full and (b) not, together
with the aggregate principal amount of the Holdings Note and the face amount of
the Unifrax Guarantees, be increased to an amount in excess of $28,500,000.

Indebtedness described on Exhibit A of the Subordination Agreement (Real Estate)
between the Subordinated Creditor and the Borrower, of even date herewith.

                                      -16-

<PAGE>   17

                                                                       EXHIBIT B

                               PERMITTED PAYMENTS
                               ------------------

         The Subordinated Creditor may receive payment of that portion of the
Subordinated Indebtedness consisting of timely payments of accrued and unpaid
interest commencing January 31, 2001.

         The Subordinated Creditor may receive payment of that portion of the
Subordinated Indebtedness consisting of payment of principal at maturity
(without giving effect to any acceleration of the maturity date currently
provided in the instrument and documents described in EXHIBIT A).

         Permitted Payments described on Exhibit B of the Subordination
Agreement (Real Estate) between the Subordinated Creditor and the Borrower, of
even date herewith.

         In no event shall the Subordinated Creditor receive any prepayments of
the Subordinated Indebtedness.

                                      -17-

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