SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
ACT OF 1934 - For the quarter ended September 30, 1998

OR

|_|   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

Commission file number 1-640

NL INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)

New Jersey                                             13-5267260
- -------------------------------                             -------------------

(State or other jurisdiction of                               (IRS Employer
incorporation or organization)                              Identification No.)

16825 Northchase Drive, Suite 1200, Houston, Texas                77060-2544
- --------------------------------------------------          -------------------

(Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code:           (281)  423-3300
-------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during  the  preceding  12  months,  and (2) had  been  subject  to such  filing
requirements for the past 90 days.     Yes X                No

Number of shares of common stock outstanding on November 9, 1998:  52,127,813

NL INDUSTRIES, INC. AND SUBSIDIARIES

INDEX

Page
PART I.     FINANCIAL INFORMATION

Item 1.   Financial Statements.

Consolidated Balance Sheets - December 31, 1997
and September 30, 1998                                       3-4

Consolidated Statements of Income - Three months
and nine months ended September 30, 1997 and 1998            5-6

Consolidated Statements of Comprehensive Income
- Three months and nine months ended September 30,
1997 and 1998                                                 7

Consolidated Statement of Shareholders' Equity
- Nine months ended September 30, 1998                        8

Consolidated Statements of Cash Flows - Nine
months ended September 30, 1997 and 1998                    9-10

Notes to Consolidated Financial Statements                   11-17

Item 2.   Management's Discussion and Analysis of Financial
Condition and Results of Operations                         18-25

PART II.    OTHER INFORMATION

Item 1.   Legal Proceedings                                             25

Item 6.   Exhibits and Reports on Form 8-K                             25-26

- 2 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands)

December 31,  September 30,
ASSETS                                      1997          1998
------------  -------------

Current assets:
Cash and cash equivalents, including
restricted cash of $9,751 and $12,660 .........     $  106,145     $  320,823
Accounts and notes receivable ..................        148,676        157,829
Refundable income taxes ........................          1,941         10,377
Inventories ....................................        192,780        191,568
Prepaid expenses ...............................          3,348          6,635
Deferred income taxes ..........................          1,642          1,923
----------     ----------

Total current assets .......................        454,532        689,155
----------     ----------

Other assets:
Marketable securities ..........................         17,270         20,057
Investment in joint ventures ...................        172,721        171,202
Prepaid pension cost ...........................         23,848         24,258
Other ..........................................         18,592         12,554
----------     ----------

Total other assets .........................        232,431        228,071
----------     ----------

Property and equipment:
Land ...........................................         19,479         19,509
Buildings ......................................        150,090        142,484
Machinery and equipment ........................        616,309        581,255
Mining properties ..............................         88,617         82,636
Construction in progress .......................          2,577          8,420
----------     ----------
877,072        834,304
Less accumulated depreciation and depletion ....        465,843        454,275
----------     ----------

Net property and equipment .................        411,229        380,029
----------     ----------

$1,098,192     $1,297,255
==========     ==========

- 3 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (CONTINUED)

(In thousands)

December 31,    September 30,
LIABILITIES AND SHAREHOLDERS' EQUITY              1997            1998
------------    -------------

Current liabilities:
Notes payable ................................    $    13,968     $    35,864

Current maturities of long-term debt .........         77,374         184,460
Accounts payable and accrued liabilities .....        161,730         206,260
Payable to affiliates ........................         11,512          10,726
Income taxes .................................         10,910          14,108
Deferred income taxes ........................            891             931
-----------     -----------

Total current liabilities ................        276,385         452,349
-----------     -----------

Noncurrent liabilities:
Long-term debt ...............................        666,779         304,060
Deferred income taxes ........................        132,797         190,310
Accrued pension cost .........................         44,389          41,738
Accrued postretirement benefits cost .........         50,951          43,492
Other ........................................        148,903         118,312
-----------     -----------

Total noncurrent liabilities .............      1,043,819         697,912
-----------     -----------

Minority interest ..............................            257             624
-----------     -----------

Shareholders' equity:
Common stock .................................          8,355           8,355
Additional paid-in capital ...................        759,281         773,864
Accumulated deficit ..........................       (495,421)       (144,800)
Accumulated other comprehensive loss .........       (129,513)       (126,170)
Treasury stock ...............................       (364,971)       (364,879)
-----------     -----------

Total shareholders' equity (deficit) .....       (222,269)        146,370
-----------     -----------

$ 1,098,192     $ 1,297,255
===========     ===========

Commitments and contingencies (Note 14)

See accompanying notes to consolidated financial statements.
- 4 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

Three months ended        Nine months ended
September 30,            September 30,
----------------------    ----------------------
1997         1998         1997         1998
---------    ---------    ---------    ---------

Revenues and other income:
Net sales .................   $ 210,344    $ 221,520    $ 629,087    $ 685,794
Other, net ................       2,956        7,500       11,718       20,769
---------    ---------    ---------    ---------

213,300      229,020      640,805      706,563
---------    ---------    ---------    ---------

Costs and expenses:
Cost of sales .............     162,499      151,782      502,353      476,026
Selling, general and
administrative ...........      30,994       32,069      130,595       98,337
Interest ..................      16,445       15,066       49,160       46,917
---------    ---------    ---------    ---------

209,938      198,917      682,108      621,280
---------    ---------    ---------    ---------

Income (loss) from
continuing operations
before income taxes and
minority interest .....       3,362       30,103      (41,303)      85,283

Income tax expense (benefit)         (608)      (1,273)      (1,714)      14,174
---------    ---------    ---------    ---------

Income (loss) from 
continuing operations
before minority
interest ..............       3,970       31,376      (39,589)      71,109

Minority interest ...........          23           17           72           36
---------    ---------    ---------    ---------

Income (loss) from 
continuing operations .       3,947       31,359      (39,661)      71,073

Discontinued operations             5,814         --         15,956      287,396
Extraordinary item - early 
extinguishment of debt, net
of tax benefit of $1,293 and
$2,568, respectively .......        --         (2,400)        -          (4,766)
---------    ---------    ---------    ---------

Net income (loss) .....   $   9,761    $  28,959    $ (23,705)   $ 353,703
=========    =========    =========    =========

- 5 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (CONTINUED)

(In thousands, except per share data)

Three months ended           Nine months ended
September 30,               September 30,
-----------------------    ------------------------
1997         1998          1997           1998
----------   ----------    ----------    ----------

Basic earnings per share:
Continuing operations ..........   $      .08   $      .61    $     (.78)   $     1.38
Discontinued operations ........          .11         --             .32          5.60
Extraordinary item .............         --           (.05)         --            (.09)
----------   ----------    ----------    ----------

Net income (loss) ............   $      .19   $      .56    $     (.46)   $     6.89
==========   ==========    ==========    ==========

Diluted earnings per share:
Continuing operations ..........   $      .08   $      .60    $     (.78)   $     1.37
Discontinued operations ........          .11         --             .32          5.52
Extraordinary item .............         --           (.05)         --           (0.09)
----------   ----------    ----------    ----------

Net income (loss) ............   $      .19   $      .55    $     (.46)   $     6.80
==========   ==========    ==========    ==========

Shares used in the calculation
of earnings per share:
Basic ..........................       51,146       51,444        51,143        51,356
Dilutive impact of stock options          439          750          --             668
----------   ----------    ----------    ----------

Diluted ........................       51,585       52,194        51,143        52,024
==========   ==========    ==========    ==========

See accompanying notes to consolidated financial statements.
- 6 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

Three months ended     Nine months ended
September 30,         September 30,
-------------------   --------------------
1997       1998       1997        1998
--------   --------   --------    --------

Net income (loss) .................   $  9,761   $ 28,959   $(23,705)   $353,703
--------   --------   --------    --------

Other comprehensive income
(loss), net of tax:
Marketable securities
adjustment .....................      2,862        913      4,829       1,812
Currency translation
adjustment .....................        935      4,603     (6,570)      1,531
--------   --------   --------    --------
Total other comprehensive
income (loss) ................      3,797      5,516     (1,741)      3,343
--------   --------   --------    --------

Comprehensive income (loss) .....   $ 13,558   $ 34,475   $(25,446)   $357,046
========   ========   ========    ========

See accompanying notes to consolidated financial statements.
- 7 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

Nine months ended September 30, 1998

(In thousands)

Accumulated other
comprehensive income (loss)
Additional               ---------------------------
Common        paid-in   Accumulated     Currency     Marketable    Treasury
stock        capital      deficit     translation   securities     stock          Total
---------    ----------  -----------  -------------  ------------  ----------    ---------

Balance at December 31, 1997 .........   $   8,355    $ 759,281    $(495,421)    $(133,810)    $   4,297    $(364,971)    $(222,269)

Net income ...........................        --           --        353,703          --            --           --         353,703

Other comprehensive income (loss), net        --           --           --           1,531         1,812         --           3,343

Dividends ............................        --           --         (3,082)         --            --           --          (3,082)

Cash received upon settlement of
shareholder derivative lawsuit, net
of $3,198 in legal fees and expenses         --         11,211         --            --            --           --          11,211

Tax benefit of stock options exercised        --          3,372         --            --            --           --           3,372

Treasury stock reissued ..............        --           --           --            --            --             92            92
---------    ---------    ---------     ---------     ---------    ---------     ---------

Balance at September 30, 1998 ........   $   8,355    $ 773,864    $(144,800)    $(132,279)    $   6,109    $(364,879)    $ 146,370
=========    =========    =========     =========     =========    =========     =========

See accompanying notes to consolidated financial statements.
- 8 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

Nine months ended September 30, 1997 and 1998

(In thousands)

1997         1998
---------     ---------

Cash flows from operating activities:
Net income (loss) ................................    $ (23,705)    $ 353,703
Depreciation, depletion and amortization .........       25,711        25,531
Noncash interest expense .........................       17,040        17,291
Deferred income taxes ............................       (1,910)        1,958
Change in accounting for environmental
remediation costs ...............................       30,000          --
Discontinued operations:
Net gain from sale of Rheox ....................         --        (286,071)
Income from operations of Rheox ................      (15,956)       (1,325)
Other, net .......................................       (9,848)       (9,453)
---------     ---------

21,332       101,634

Change in assets and liabilities:
Accounts and notes receivable ..................      (29,417)      (26,697)
Inventories ....................................       45,742       (13,670)
Prepaid expenses ...............................       (2,967)       (3,501)
Accounts payable and accrued liabilities .......       14,162        12,994
Income taxes ...................................        7,293       (14,572)
Other, net .....................................       (5,598)       11,808
Rheox, net .......................................       20,266       (25,864)
---------     ---------

Net cash provided by operating activities ....       70,813        42,132
---------     ---------

Cash flows from investing activities:
Proceeds from sale of Rheox ......................         --         435,080
Capital expenditures .............................      (22,154)      (12,731)
Collection of note receivable ....................         --           6,875
Investment in joint venture, net .................        5,836          (371)
Proceeds from disposition of property
and equipment ...................................        2,912           486
Rheox, net .......................................       (1,185)          (26)
---------     ---------
Net cash provided (used) by investing
activities ..................................      (14,591)      429,313
---------     ---------

- 9 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

Nine months ended September 30, 1997 and 1998

(In thousands)

1997         1998
---------    ---------

Cash flows from financing activities:
Indebtedness:
Borrowings .......................................   $    --      $  30,491
Principal payments ...............................    (173,739)    (170,853)
Deferred financing costs .........................      (2,343)        --
Settlement of shareholder derivative lawsuit, net ..        --         11,211
Dividends ..........................................        --         (3,082)
Rheox, net .........................................     108,775     (117,500)
Other, net .........................................         252           90
---------    ---------

Net cash used by financing activities ..........     (67,055)    (249,643)
---------    ---------

Cash and cash equivalents:
Net change from:
Operating, investing and financing activities ....     (10,833)     221,802
Currency translation .............................      (1,068)         506
Sale of Rheox ....................................        --         (7,630)
Balance at beginning of period .....................     114,115      106,145
---------    ---------

Balance at end of period ...........................   $ 102,214    $ 320,823
=========    =========

Supplemental disclosures - cash paid for:
Interest, net of amounts capitalized ...............   $  35,262    $  21,972
Income taxes, net ..................................       1,317       47,839

See accompanying notes to consolidated financial statements.
- 10 -

NL INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION:

NL  Industries,  Inc.  conducts its  titanium  dioxide  pigments  ("TiO2")
operations through its wholly-owned subsidiary, Kronos, Inc. In January 1998 the
specialty  chemicals business of Rheox,  Inc., a wholly-owned  subsidiary of NL,
was sold.  At  September  30, 1998 Valhi,  Inc.  and Tremont  Corporation,  each
affiliates of Contran Corporation, held approximately 58% and 19%, respectively,
of NL's  outstanding  common stock, and together may be deemed to control NL. At
September  30,  1998  Contran and its  subsidiaries  held  approximately  92% of
Valhi's outstanding common stock, and Valhi and other entities related to Harold
C. Simmons held approximately 53% of Tremont's outstanding common stock.

The  consolidated  balance sheet of NL Industries,  Inc. and  Subsidiaries
(collectively,  the  "Company") at December 31, 1997 has been condensed from the
Company's  audited   consolidated   financial   statements  at  that  date.  The
consolidated balance sheet at September 30, 1998 and the consolidated statements
of income,  comprehensive  income,  shareholders'  equity and cash flows for the
interim  periods  ended  September  30, 1997 and 1998 have been  prepared by the
Company,  without  audit.  In  the  opinion  of  management,   all  adjustments,
consisting only of normal recurring adjustments, necessary to present fairly the
consolidated financial position,  results of operations and cash flows have been
made.  The results of  operations  for the interim  periods are not  necessarily
indicative of the operating results for a full year or of future operations.

Certain  information  and  footnote   disclosures   normally  included  in
financial  statements  prepared in accordance with generally accepted accounting
principles have been condensed or omitted.  Certain prior-year amounts have been
reclassified to conform to the current year  presentation,  including  reporting
the Company's  specialty  chemicals  business as a discontinued  operation.  The
accompanying  consolidated  financial  statements  should be read in conjunction
with the  consolidated  financial  statements  included in the Company's  Annual
Report on Form 10-K for the year  ended  December  31,  1997 (the  "1997  Annual
Report").

The  Company  will  adopt  Statement  of  Financial  Accounting  Standards
("SFAS") No. 133, Accounting for Derivative  Instruments and Hedging Activities,
no later than the first  quarter of 2000.  SFAS No. 133  establishes  accounting
standards for derivative  instruments,  including certain derivative instruments
embedded in other contracts, and for hedging activities. Under SFAS No. 133, all
derivatives  will be recognized as either assets or liabilities  and measured at
fair value.  The accounting for changes in fair value of derivatives will depend
upon the intended use of the derivative.  The Company is currently studying this
newly-issued  accounting  rule, and the impact of adopting SFAS No. 133, if any,
has not yet been  determined  but will be dependent upon the extent to which the
Company  is  then  a  party  to  derivative  contracts  or  engaged  in  hedging
activities.  At September 30, 1998 the Company is not a party to any  derivative
contracts or engaged in any hedging activities covered by SFAS No. 133.

- 11 -

NOTE 2 - EARNINGS PER SHARE:

Basic  earnings  per  share are based on the  weighted  average  number of
common shares  outstanding  during each period.  Diluted  earnings per share are
based on the weighted average common shares  outstanding and the dilutive impact
of outstanding stock options.

NOTE 3 - BUSINESS SEGMENT INFORMATION:

The  Company's  continuing  operations  are  conducted  by  Kronos  in one
business segment - TiO2.

Three months ended         Nine months ended
September 30,             September 30,
----------------------    ----------------------
1997         1998         1997         1998
---------    ---------    ---------    ---------
(In thousands)

Net sales .........................   $ 210,344    $ 221,520    $ 629,087    $ 685,794
Other income, excluding
corporate ........................       2,306        2,036        9,476        4,719
---------    ---------    ---------    ---------
212,650      223,556      638,563      690,513

Cost of sales .....................     162,499      151,782      502,353      476,026
Selling, general and
administrative, excluding
corporate ........................      25,243       26,750       85,798       83,339
---------    ---------    ---------    ---------

Operating income ..................      24,908       45,024       50,412      131,148

General corporate income (expense):
Securities earnings, net ........         590        4,345        1,817       12,747
Expenses, net ...................      (5,691)      (4,200)     (44,372)     (11,695)
Interest expense ................     (16,445)     (15,066)     (49,160)     (46,917)
---------    ---------    ---------    ---------

$   3,362    $  30,103    $ (41,303)   $  85,283
=========    =========    =========    =========

Corporate expenses,  net decreased in the first nine months of 1998 due to
the $30 million noncash charge taken in the first quarter of 1997 related to the
adoption of a new method of  accounting  for certain  environmental  remediation
costs.

NOTE 4 - INVENTORIES:

December 31,  September 30,
1997          1998
------------  -------------
(In thousands)

Raw materials ................................         $ 45,844         $ 37,984
Work in process ..............................            8,018           11,472
Finished products ............................          107,427          107,468
Supplies .....................................           31,491           34,644
--------         --------

$192,780         $191,568
========         ========

- 12 -

NOTE 5 - MARKETABLE SECURITIES:

December 31, September 30,
1997         1998
-----------  -------------
(In thousands)

Available-for-sale securities - noncurrent
marketable equity securities:
Unrealized gains .................................     $  6,939      $ 11,254
Unrealized losses ................................         (328)       (1,856)
Cost .............................................       10,659        10,659
--------      --------

Aggregate market .............................     $ 17,270      $ 20,057
========      ========

NOTE 6 - INVESTMENT IN JOINT VENTURES:

December 31, September 30,
1997         1998
-----------  -------------
(In thousands)

TiO2 manufacturing joint venture ...............        $170,830        $171,202
Other ..........................................           1,891            --
--------        --------

$172,721        $171,202
========        ========

NOTE 7 - OTHER NONCURRENT ASSETS:

December 31, September 30,
1997         1998
-----------  -------------
(In thousands)

Deferred financing costs, net ..................         $ 9,973         $ 6,427
Intangible assets, net .........................           4,228           2,613
Other ..........................................           4,391           3,514
-------         -------

$18,592         $12,554
=======         =======

NOTE 8 - ACCOUNTS PAYABLE AND ACCRUED LIABILITIES:

December 31, September 30,
1997         1998
-----------  -------------
(In thousands)

Accounts payable .........................           $ 64,698           $ 50,831
--------           --------
Accrued liabilities:
Employee benefits ......................             40,110             35,169
Environmental costs ....................              9,000             48,146
Interest ...............................              6,966             15,371
Other ..................................             40,956             56,743
--------           --------

97,032            155,429
--------           --------
$161,730           $206,260
========           ========

- 13 -

NOTE 9 - OTHER NONCURRENT LIABILITIES:

December 31, September 30,
1997         1998
-----------  -------------
(In thousands)

Environmental costs ..........................         $125,502         $ 79,355
Insurance claims and expenses ................           11,436           12,200
Employee benefits ............................           10,835           10,626
Deferred income ..............................             --             13,333
Other ........................................            1,130            2,798
--------         --------

$148,903         $118,312
========         ========

NOTE 10 - NOTES PAYABLE AND LONG-TERM DEBT:

December 31, September 30,
1997         1998
-----------  -------------
(In thousands)

Notes payable - Kronos (DM 25,000 and
DM 60,500, respectively) ..........................      $ 13,968      $ 35,864
========      ========

Long-term debt:
NL Industries:
11.75% Senior Secured Notes ....................      $250,000      $244,000
13% Senior Secured Discount Notes ..............       169,857       118,583
--------      --------

419,857       362,583
--------      --------
Kronos:
DM bank credit facility (DM 288,322 and
DM 207,322, respectively) .....................       161,085       124,419
Joint venture term loan ........................        42,429          --
Other ..........................................         3,282         1,518
--------      --------

206,796       125,937
--------      --------

Rheox - bank term loan ...........................       117,500          --
--------      --------

744,153       488,520

Less current maturities ............................        77,374       184,460
--------      --------

$666,779      $304,060
========      ========

The Company  redeemed the 13% Senior Secured Discount Notes on October 15,
1998 at the redemption price of 106% of the principal amount, in accordance with
the terms of the Senior  Secured  Discount  Notes  indenture.  As a result,  the
accreted  value of the Senior Secured  Discount  Notes has been  classified as a
current liability at September 30, 1998.

- 14 -

NOTE 11 - INCOME TAXES:

The difference  between the provision for income tax expense  attributable
to income from continuing  operations  before income taxes and minority interest
and the amount that would be expected using the U.S.  federal  statutory  income
tax rate of 35% is presented below.

Nine months ended
September 30,
--------------------
1997       1998
--------    --------
(In thousands)

Expected tax expense (benefit) .........................   $(14,456)   $ 29,849
Non-U.S. tax rates .....................................       (462)        281
Incremental tax on income of companies not included
in NL's consolidated U.S. federal income tax return ...      2,171       2,142
Refund of prior-year dividend withholding tax ..........       --        (8,219)
Change in valuation allowance ..........................     10,459      (9,798)
U.S. state income taxes ................................       --           200
Other, net .............................................        574        (281)
--------    --------

Income tax expense (benefit) .....................   $ (1,714)   $ 14,174
========    ========

NOTE 12 - OTHER INCOME, NET:

Three months ended      Nine months ended
September 30,          September 30,
--------------------   --------------------
1997        1998        1997       1998
--------    --------   --------    --------
(In thousands)

Corporate interest and dividend
income ..........................   $    869    $  4,345   $  1,817    $ 12,747
Currency transaction gains, net ..        155         986      3,220       2,703
Noncompete agreement income ......       --         1,000       --         2,667
Trade interest income ............        759         525      2,047       1,562
Gain (loss) from disposition of ..        172
property and equipment ..........       (311)      2,452       (130)
Other, net .......................      1,484         472      2,182       1,220
--------    --------   --------    --------

$  2,956    $  7,500   $ 11,718    $ 20,769
========    ========   ========    ========

NOTE 13 - DISCONTINUED OPERATIONS:

The Company sold the net assets of its Rheox specialty  chemicals business
for $465 million cash (before fees and  expenses) in the first  quarter of 1998,
including $20 million  attributable to a five-year  agreement by the Company not
to compete in the  rheological  products  business.  The Company  recognized  an
after-tax  gain of  approximately  $286  million  on the  sale of this  business
segment.  A portion of the $380  million  after-tax  proceeds was used to reduce
outstanding indebtedness by approximately $231 million.

- 15 -

Condensed income statement data related to discontinued operations for the
interim  periods  ended  September  30, 1997 and 1998 are as  follows.  Interest
expense has been  allocated to  discontinued  operations  based on the amount of
debt specifically attributed to Rheox's operations.

Nine months ended
September 30,
-----------------------
1997          1998
---------     ---------
(In thousands)

Operations:
Net sales .........................................    $ 111,336     $  12,630
=========     =========

Operating income ..................................    $  34,315     $   2,900
Interest and other expenses .......................        8,933           797
---------     ---------

Income before income taxes and minority
interest .....................................       25,382         2,103

Income tax expense ................................        9,463           778
Minority interest .................................          (37)         --
---------     ---------

15,956         1,325

Gain from sale of Rheox, net of tax expense of
$86,222                                                      --         286,071
---------     ---------

$  15,956     $ 287,396
=========     =========

Condensed  cash  flow  data  for  Rheox  (excluding   dividends  paid  to,
contributions received from and intercompany loans with NL) is presented below:

Nine months ended
September 30,
------------------------
1997          1998
----------     ---------
(In thousands)

Cash flows from:
Operating activities ...........................     $  20,266      $ (26,493)
Investing activities - capital expenditures ....           (26)
and other .....................................        (1,185)
Financing activities - indebtedness, net .......       108,775       (117,500)
---------      ---------

$ 127,856      $(144,019)
=========      ========= 

NOTE 14 - COMMITMENTS AND CONTINGENCIES:

For  descriptions  of  certain  legal  proceedings,  income  tax and other
commitments and contingencies  related to the Company,  reference is made to (i)
Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations,  (ii) Part II,  Item 1  -"Legal  Proceedings,"  (iii) the  Company's
Quarterly Report on Form 10-Q for the quarters ended March 31, 1998 and June 30,
1998, and (iv) the 1997 Annual Report.

- 16 -

In July 1998 the Company reached an agreement (the "Tioxide  Purchase") to
(i) acquire the North American TiO2 operations of Imperial  Chemical  Industries
plc's ("ICI")  subsidiary,  Tioxide Group  Limited,  and a Tioxide TiO2 plant in
England, and (ii) cancel certain rights to chloride-process  technology licensed
to Tioxide by the Company in connection with the formation of Louisiana  Pigment
Company ("LPC") in 1993. The aggregate amount to be paid to ICI is approximately
$365  million,  including a $30 million fee for the  cancellation  of technology
rights and approximately $50 million in working capital. The purchase is subject
to regulatory clearances,  completion of the purchase by E.I. du Pont de Nemours
&  Co.  of  ICI's  remaining  non-North  American  TiO2  business  (the  "DuPont
Purchase"), and other conditions customary to transactions of this type.

The operations to be acquired  include  Tioxide's  50%-interest  in LPC, a
manufacturing  joint  venture  of  the  Company  and  Tioxide  that  operates  a
chloride-process  TiO2 plant in Louisiana with capacity of approximately 120,000
metric tons per annum ("mtpa"); Tioxide's 75,000 mtpa sulfate-process TiO2 plant
in Grimsby, England; Tioxide's 52,000 mtpa finishing plant in Tracy, Quebec; and
Tioxide's North American marketing and distribution business.

Upon  completion  of the DuPont  Purchase  and the Tioxide  Purchase,  the
Company  expects to become  the  world's  third  largest  manufacturer  of TiO2,
increasing its productive capacity by approximately 135,000 mtpa.

Assuming  regulatory  clearances are received in 1998, the Company expects
the Tioxide Purchase to close in the first quarter of 1999.

- 17 -

MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF  FINANCIAL  CONDITION AND RESULTS OF
OPERATIONS
- --------------------------------------------------------------------------------
RESULTS OF OPERATIONS

Three months ended    %         Nine months ended       %
September 30,    Change        September 30,      Change
------------------  ------     -------------------   ------
1997       1998                1997         1998
------     ------              ------       ------         
(In millions)                  (In millions)

Net sales ................     $210.3     $221.5    +5%       $629.1       $685.8     +9%

Operating income .........     $ 24.9     $ 45.0   +81%       $ 50.4       $131.1   +160%

Percent changes in TiO2:
Sales volume ...........                          -9%                               -2%
Average selling prices
(in billing currencies)                         +17%                              +17%

Kronos'  operating  income in the third  quarter  and first nine months of
1998 increased from the comparable periods in 1997 due to higher average selling
prices,  partially  offset by lower sales volume and the absence of $9.7 million
of income from refunds of German  franchise  taxes received in the third quarter
of 1997. Kronos expects its fourth-quarter 1998 operating income will exceed its
fourth-quarter  1997  operating  income  primarily  because  of  higher  average
fourth-quarter  1998 TiO2 selling prices,  partially  offset by moderately lower
fourth-quarter 1998 sales volume.

Average TiO2 selling  prices for the third quarter of 1998 were 17% higher
than the third quarter of 1997 and 2% higher than the second quarter of 1998.

Kronos'  third-quarter  sales  volume  decreased  9% from the record sales
volume in the year-earlier period as demand moderated. Sales volume in the first
nine  months  of 1998  was 2%  lower  than  the  year-earlier  period  primarily
reflecting  lower sales volume in Asia,  partially offset by higher sales volume
in  Europe.  As a result of lower  second-half  1998  demand  for  TiO2,  Kronos
anticipates its TiO2 sales volume for full-year 1998 will be slightly below that
of calendar year 1997.

Kronos' cost of sales as a percentage of net sales  decreased in the third
quarter and first nine months of 1998  primarily due to higher  average  selling
prices.  Kronos' selling,  general and administrative  expenses decreased in the
third  quarter  and first nine  months of 1998 due to lower  distribution  costs
associated  with lower sales volume and  favorable  effects of foreign  currency
translation,  partially offset by the impact of the German franchise tax refunds
received in the third quarter of 1997.

A significant amount of sales are denominated in currencies other than the
U.S. dollar,  and fluctuations in the value of the U.S. dollar relative to other
currencies  decreased  the dollar value of sales for the third quarter and first
nine months of 1998 by $3 million and $26 million, respectively, compared to the
comparable 1997 periods.

- 18 -

The  following  table sets forth  certain  information  regarding  general
corporate income (expense).

Three months ended             Nine months ended
September 30,   Difference    September 30,   Difference
------------------ ---------- ------------------ ----------
1997     1998                 1997     1998
------   ------               ------   ------         
(In millions)

Securities earnings ...  $   .6   $  4.3    $ 3.7      $  1.8   $ 12.7    $10.9
Corporate expenses, net    (5.7)    (4.1)     1.6       (44.3)   (11.6)    32.7
Interest expense ......   (16.4)   (15.1)     1.3       (49.2)   (46.9)     2.3
------   ------    -----      ------   ------    -----

$(21.5)  $(14.9)   $ 6.6      $(91.7)  $(45.8)   $45.9
======   ======    =====      ======   ======    =====

Securities earnings increased due to higher average balances available for
investment.  Corporate expenses,  net in the first nine months of 1998 was lower
than the comparable  period in 1997 due to the $30 million  noncash charge taken
in the first quarter of 1997 related to the Company's  adoption of SOP No. 96-1,
"Environmental  Remediation  Liabilities."  This  charge is included in selling,
general and administrative expense in the Company's  consolidated  statements of
income.

The Company expects general corporate interest income and interest expense
to be lower in the fourth  quarter of 1998 compared to the third quarter of 1998
due to the  redemption  of the remaining 13% Senior  Secured  Discount  Notes on
October 15, 1998.

Income  taxes in the third  quarter of 1998  include a tax benefit of $8.2
million resulting from a refund of prior-year German dividend withholding taxes.

The Company sold the net assets of its Rheox specialty  chemicals business
in the first quarter of 1998 and, as a result of the sale,  Rheox's  results are
reported as discontinued operations.

LIQUIDITY AND CAPITAL RESOURCES

The  Company's  consolidated  cash flows  from  operating,  investing  and
financing  activities for the nine months ended  September 30, 1997 and 1998 are
presented below.

Nine months ended
September 30,
-----------------
1997       1998
------    ------
(In millions)

Net cash provided (used) by:
Operating activities ....................................    $ 70.8    $ 42.1
Investing activities ....................................     (14.6)    429.3
Financing activities ....................................     (67.0)   (249.6)
------    ------

Net cash provided (used) by operating, investing
and financing activities ...........................    $(10.8)   $221.8
======    ======

The TiO2  industry is cyclical and changes in economic  conditions  within
the industry  significantly  impact the earnings and operating cash flows of the
Company. Cash flow from operations, before changes in assets and liabilities,

- 19 -

in the 1998 period improved significantly from the comparable period in 1997 due
to higher operating income.  Changes in the Company's  inventories,  receivables
and payables  (excluding  the effect of currency  translation)  used cash in the
first nine  months of 1998 but  provided  cash in the first nine  months of 1997
primarily due to  reductions  in inventory  levels in the 1997 period and higher
payments  of income  taxes in the 1998 period as a result of the gain on sale of
Rheox.

The  sale of the  Company's  specialty  chemicals  business  in the  first
quarter of 1998 resulted in net proceeds of $380 million  after  current  income
taxes and other  expenses.  In the first nine months of 1998, the Company used a
portion of the net proceeds to repay certain  indebtedness,  as described below,
and on  October  15,  1998,  used a portion  of the net  proceeds  to redeem the
remaining  $119 million of 13% Senior  Secured  Discount Notes at the redemption
price of 106% of the  principal  amount,  in  accordance  with the  terms of the
Discount Notes indenture.

During the first nine months of 1998,  the  Company  used a portion of the
net  proceeds  to (i) prepay $118  million of the Rheox  credit  facility,  (ii)
prepay $42 million of Kronos'  share of the LPC joint  venture term loan,  (iii)
make $65 million of  open-market  purchases of the Company's 13% Senior  Secured
Discount  Notes at prices  ranging  from  $101.25 to  $105.19  per $100 of their
principal amounts,  and (iv) purchase $6 million of the Senior Secured Notes and
$61 thousand of the Senior Secured  Discount Notes at a price of $100 and $96.03
per $100 of their principal amounts,  respectively,  pursuant to a June 1998 pro
rata tender offer to Note holders as required under the terms of the indenture.

The Company  prepaid DM 81 million  ($44 million when paid) of its DM term
loan in the first quarter of 1998. A portion of the funds for such prepayment of
the DM term loan was provided by a first-quarter DM 35 million ($19 million when
borrowed)  increase in  outstanding  borrowings  under the Company's  short-term
non-U.S. credit facilities. In the second quarter of 1998, the Company repaid DM
20 million ($11 million when paid) of the DM revolving credit facility.

In order to complete the Tioxide  Purchase,  the Company expects to borrow
approximately $250 million in bank financing.

At  September  30,  1998  the  Company  had  cash  and  cash   equivalents
aggregating  $321  million  (14%  held  by  non-U.S.  subsidiaries),   including
restricted cash equivalents of $13 million.  The Company's  subsidiaries had $91
million  available for borrowing at September 30, 1998 under  existing  non-U.S.
credit facilities.

In the  third  quarter  of 1998,  the  Company  paid a  regular  quarterly
dividend of $.03 per share to shareholders  aggregating $1.5 million.  Dividends
paid during the first nine months of 1998 totaled $3.1 million.  In October 1998
the Company's Board of Directors  declared a regular quarterly  dividend of $.03
per  share to  shareholders  of  record as of  December  16,  1998 to be paid on
December 30, 1998.

In June 1998, as a result of the  settlement  of a shareholder  derivative
lawsuit on behalf of the Company, Valhi transferred $14.4 million in cash to the

- 20 -

Company, and the Company agreed to pay plaintiffs'  attorneys' fees and expenses
of $3.2 million.

Certain  of the  Company's  tax  returns  in  various  U.S.  and  non-U.S.
jurisdictions  are being  examined  and tax  authorities  have  proposed  or may
propose tax deficiencies,  including  non-income tax related items and interest.
The Company  previously reached an agreement with the German tax authorities and
paid certain tax  deficiencies of  approximately DM 44 million ($28 million when
paid),  including  interest,  which resolved  significant tax  contingencies for
years through 1990. In the third quarter of 1998,  the Company  received a DM 14
million ($8.2 million when received) refund of 1990 German dividend  withholding
taxes.  The German tax authorities were required to refund such amounts based on
a recent German Supreme Court decision in favor of another taxpayer.  The refund
resulted in a reduction of the settlement  amount from DM 44 million referred to
above to DM 30  million  for years  through  1990.  No further  withholding  tax
refunds are expected.

Certain  other  significant   German  tax  contingencies   aggregating  an
estimated  DM 172 million  ($102  million at September  30,  1998)  through 1997
remain outstanding and are in litigation. Of these, one primary issue represents
disputed amounts  aggregating DM 160 million ($95 million at September 30, 1998)
for  years  through  1997.  The  Company  has  received  tax  assessments  for a
substantial   portion  of  these  amounts.   No  payments  of  tax  or  interest
deficiencies  related to these  assessments are expected until the litigation is
resolved.  During  1997 a German  tax  court  proceeding  involving  a tax issue
substantially  the same as this issue was decided in favor of the taxpayer.  The
German tax authorities  have appealed that decision to the German Supreme Court.
The  Company  believes  that a  decision  by the  German  Supreme  Court will be
rendered  within a year and will likely  determine  the outcome of the Company's
primary dispute with the German tax  authorities.  Although the Company believes
that it will ultimately  prevail in this matter, the Company has granted a DM 94
million ($56 million at September 30, 1998) lien on its Nordenham,  Germany TiO2
plant in favor of the City of  Leverkusen,  and a DM 5 million  ($3  million  at
September 30, 1998) lien in favor of the German federal tax authorities.  If the
Company does not prevail,  these  contingencies  will increase the Company's tax
liability  for 1990 and each year  thereafter,  and the  Company  would  seek to
negotiate payment over a period of time.

In addition,  during 1997 the Company reached an agreement with the German
tax authorities  regarding  certain other issues not in litigation for the years
1991 through 1994, and agreed to pay additional tax deficiencies of DM 9 million
($5 million at September 30, 1998),  most of which was paid in the third quarter
of 1998.

During 1997 the Company  received a tax assessment  from the Norwegian tax
authorities  proposing  tax  deficiencies  of  NOK 51  million  ($7  million  at
September 30, 1998) relating to 1994.  The Company has appealed this  assessment
and has begun litigation proceedings. Although the Company believes that it will
ultimately  prevail,  the  Company has granted a lien for the full amount of the
tax assessment on its  Fredrikstad,  Norway TiO2 plant in favor of the Norwegian
tax authorities.

- 21 -

No  assurance  can be given that these tax matters will be resolved in the
Company's  favor  in  view  of the  inherent  uncertainties  involved  in  court
proceedings.  The Company  believes that it has provided  adequate  accruals for
additional taxes and related  interest expense which may ultimately  result from
all such  examinations  and  believes  that  the  ultimate  disposition  of such
examinations  should  not  have a  material  adverse  effect  on  the  Company's
consolidated financial position, results of operations or liquidity.

The Company has been named as a defendant,  potentially  responsible party
("PRP"), or both, in a number of legal proceedings associated with environmental
matters,  including  waste  disposal  sites,  mining  locations  and  facilities
currently or previously owned, operated or used by the Company, certain of which
are on the U.S.  Environmental  Protection  Agency's (the "U.S.  EPA") Superfund
National  Priorities  List or similar  state lists.  On a quarterly  basis,  the
Company  evaluates  the  potential  range of its liability at sites where it has
been named as a PRP or defendant.  The Company believes it has adequate accruals
($128  million at September  30, 1998) for  reasonably  estimable  costs of such
matters,  but the  Company's  ultimate  liability may be affected by a number of
factors,   including  changes  in  remedial  alternatives  and  costs,  and  the
allocations  of such costs among PRPs.  It is not possible to estimate the range
of costs for certain  sites.  The upper end of the range of reasonably  possible
costs to the Company  for sites for which it is  possible  to estimate  costs is
approximately $160 million. The Company's estimates of such liabilities have not
been  discounted  to present  value,  and the  Company  has not  recognized  any
potential insurance recoveries. No assurance can be given that actual costs will
not  exceed  accrued  amounts  or the upper end of the range for sites for which
estimates  have been made,  and no assurance can be given that costs will not be
incurred  with respect to sites as to which no estimate  presently  can be made.
Further,  there can be no assurance that additional  environmental  matters will
not arise in the future.

The Company is also a defendant in a number of legal  proceedings  seeking
damages for personal  injury and property  damage  arising from the sale of lead
pigments and lead-based paints.  There is no assurance that the Company will not
incur  future  liability in respect of this  pending  litigation  in view of the
inherent  uncertainties  involved  in court  and jury  rulings  in  pending  and
possible  future cases.  However,  based on, among other things,  the results of
such litigation to date, the Company  believes that the pending lead pigment and
paint  litigation is without merit.  The Company has not accrued any amounts for
such pending litigation. Liability that may result, if any, cannot be reasonably
estimated. In addition, various legislation and administrative regulations have,
from  time to time,  been  enacted  or  proposed  that  seek to  impose  various
obligations on present and former  manufacturers  of lead pigment and lead-based
paint with respect to asserted health  concerns  associated with the use of such
products and to effectively  overturn  court  decisions in which the Company and
other  pigment  manufacturers  have been  successful.  Examples of such proposed
legislation  include bills which would permit civil liability for damages on the
basis of market  share,  rather  than  requiring  plaintiffs  to prove  that the
defendant's  product caused the alleged damage.  The Company currently  believes
the disposition of all claims and disputes,  individually  and in the aggregate,
should  not  have  a  material  adverse  effect  on the  Company's  consolidated
financial

- 22 -

position,  results of operations or  liquidity.  There can be no assurance  that
additional matters of these types will not arise in the future.

The Company is in the process of  evaluating  and  upgrading  its computer
systems (both information technology ("IT") systems and non-IT systems involving
embedded chip technology) and software applications (collectively referred to as
"systems") to ensure that the systems  function  properly  beginning  January 1,
2000.  To achieve  its year 2000  compliance  plan,  the  Company  is  utilizing
internal and external resources to identify,  correct or reprogram, and test its
systems.

The Company has conducted an inventory of its IT systems  worldwide and is
currently  testing the  systems and  applications  that have been  corrected  or
reprogrammed for year 2000  compliance.  The Company has completed a preliminary
inventory  of its  non-IT  systems  and  is in the  process  of  validating  the
inventory and correcting or replacing date-deficient systems. The Company uses a
number of  packaged  software  products  that have been  upgraded to a year 2000
compliant version in the normal course of business.  Excluding the cost of these
software  upgrades,  the  Company's  cost of  becoming  year 2000  compliant  is
expected to be approximately $2 million, of which about one-third has been spent
through September 1998. The Company expects its major IT systems to be year 2000
compliant  by March  1999,  and  expects  its  non-IT  systems  to be year  2000
compliant by September 1999.

As part of its year  2000  compliance  plan,  the  Company  has  requested
confirmations  from its major domestic and foreign  software  vendors,  hardware
vendors and primary  suppliers,  that they are developing and implementing plans
to become, or are, year 2000 compliant.  Confirmations received to date from the
Company's software vendors, hardware vendors and primary suppliers indicate that
generally they are in the process of  implementing  remediation  plans to ensure
that their  systems are  compliant  by December  31,  1999.  The major  software
vendors used by the Company have already delivered year 2000 compliant software.
The Company plans to request  confirmations  from its major  customers that they
are developing or implementing plans to become year-2000 compliant.

The Company is developing a  contingency  plan to address  potential  year
2000  related  business  interruptions  that may occur on January  1,  2000,  or
thereafter. This plan is expected to be completed in the second quarter of 1999.

Although the Company expects its systems to be year 2000 compliant  before
December  31,  1999,  it cannot  predict the outcome or success of the year 2000
compliance programs of its vendors,  suppliers,  and customers. The Company also
cannot predict whether its major software vendors, who continue to test for year
2000  compliance,  will find additional  problems that would result in unplanned
upgrades of their  applications  after  December 31, 1999.  As a result of these
uncertainties,  the Company cannot predict the impact on its financial condition
or results of  noncompliant  year 2000  systems  that the  Company  directly  or
indirectly  relies upon.  Should the Company's year 2000  compliance plan not be
successful or be delayed beyond January 2000,  the  consequences  to the Company
could be  far-reaching  and material,  including an inability to produce TiO2 at
its  manufacturing  facilities,  which could lead to an indeterminate  amount of
lost

- 23 -

revenue.  Other potential negative consequences could include plant malfunction,
impeded  communications or power supplies, or slower transaction  processing and
financial reporting.

Beginning  January 1, 1999,  eleven of the fifteen members of the European
Union ("EU"),  including  Germany,  Belgium,  the Netherlands  and France,  have
agreed to adopt a new European  currency unit (the "euro") as their common legal
currency.  Following the introduction of the euro, the participating  countries'
national  currencies will remain legal tender as  denominations of the euro from
January 1, 1999 through January 1, 2002, and the exchange rates between the euro
and such national currency units will be fixed.

The Company  conducts  substantial  operations in Europe.  The  functional
currency of the Company's  German,  Belgian,  Dutch and French  operations  will
convert to the euro from their  respective  national  currencies over a two-year
period  beginning  in  1999.  The  euro  conversion  may  impact  the  Company's
operations including,  among other things,  changes in product pricing decisions
necessitated  by  cross-border  price  transparencies.  Such  changes in product
pricing  decisions  could impact both selling prices and  purchasing  costs and,
consequently, favorably or unfavorably impact results of operations.

The  Company  has  a  significant  amount  of  outstanding  DM-denominated
indebtedness  and such debt will become  euro-denominated  effective  January 1,
1999.   Modifications   of  information   systems  to  handle   euro-denominated
transactions will be required, although the modifications are not expected to be
extensive.

The Company has begun to assess and evaluate  the  expected  impact of the
euro conversion on its business.  Such  evaluations are still in process but are
expected to be  concluded by the end of 1998.  The Company  expects to spend and
charge to expense  less than $1  million in  evaluation  and  conversion  costs.
Because  of  the  inherent  uncertainty  of the  ultimate  affect  of  the  euro
conversion,  the Company cannot accurately  predict the impact on its results of
operations, financial condition or liquidity.

The Company periodically evaluates its liquidity requirements, alternative
uses of capital,  capital needs and  availability of resources in view of, among
other  things,  its  debt  service  and  capital  expenditure  requirements  and
estimated future operating cash flows. As a result of this process,  the Company
in the past has  sought,  and in the  future  may seek,  to  reduce,  refinance,
repurchase  or  restructure   indebtedness,   raise  additional  capital,  issue
additional  securities,   modify  its  dividend  policy,  restructure  ownership
interests, sell interests in subsidiaries or other assets, or take a combination
of such steps or other steps to manage its liquidity and capital  resources.  In
the normal course of its business,  the Company may review opportunities for the
acquisition,  divestiture,  joint venture or other business  combinations in the
chemicals   industry.   In  the  event  of  any  acquisition  or  joint  venture
transaction,  the Company may consider  using  available  cash,  issuing  equity
securities  or  increasing  its  indebtedness  to the  extent  permitted  by the
agreements governing the Company's existing debt.

- 24 -

The statements  contained in this Report on Form 10-Q ("Quarterly Report")
that are not historical facts,  including,  but not limited to, statements found
under the captions "Results of Operations" and "Liquidity and Capital Resources"
above,  are  forward-looking  statements  that  involve  a number  of risks  and
uncertainties.  The  actual  results  of the  future  events  described  in such
forward-looking statements in this Quarterly Report could differ materially from
those stated in such  forward-looking  statements and the Company  disclaims any
intention  or  obligation  to update or revise any  forward-looking  statements,
whether as a result of new  information,  future events or otherwise.  Among the
factors that could cause actual  results to differ  materially are the risks and
uncertainties  discussed in this Quarterly Report and in the 1997 Annual Report,
including,  without limitation,  the portions of such reports under the captions
referenced  above,  and the  uncertainties  set  forth  from time to time in the
Company's other public reports and filings and public statements.

PART II.  OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

Reference is made to the 1997 Annual Report and the Company's Quarterly
Report on Form 10-Q for the quarters  ended March 31, 1998 and June 30, 1998 for
descriptions of certain previously-reported legal proceedings.

State of Illinois v. NL Industries, Inc., et al. (No. 88-CH-11618).  In
October 1998 the Supreme Court of Illinois declined the State's petition to
review the previously reported decisions in favor of the Company.

DeLeon v. Exide Corp. and NL Industries, Inc., (No. DV98-02669-B).  In
August 1998 the plaintiffs dismissed this previously-reported case without
prejudice.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

(a) EXHIBITS

10.1 -  1998  Framework  Agreement  between  ICI,  DuPont  and  the
Registrant dated July 24, 1998.

10.2   - July 24, 1998 Agreement between ICI and the Registrant.

10.3 - Form  of  Hivedown  Agreement  to be  entered  into  between
Tioxide Europe Limited and Newco.

10.4 - Form of Share  Sale and  Purchase  Agreement  of Newco to be
entered into between Tioxide Europe Limited and the Registrant.

10.5 - Form  of  Product  Exchange  Agreement  to be  entered  into
between Newco and Tioxide Europe Limited.

- 25 -

10.6   - Form of Share Sale and Purchase Agreement of Tioxide
Americas Inc. to be entered into between ICI American Holdings Inc.
and the Registrant.

10.7   - Form  of  Share  Sale  and  Purchase  Agreement of Tioxide
CanadaInc. to be entered into between Tioxide Group Limited and ICI
Omicron B.V. and the Registrant.

10.8 - Form of  Americas  Liability  Agreement  to be entered  into
between ICI and the Registrant.

10.9 -  Intercorporate  Services  Agreement by and between  Contran
Corporation and the Registrant effective as of January 1, 1998.

10.10 -  Intercorporate  Services  Agreement by and between  Valhi,
Inc. and the Registrant effective as of January 1, 1998.

10.11 -  Intercorporate  Services  Agreement by and between Tremont
Corporation and the Registrant effective as of January 1, 1998.

10.12 - Intercorporate  Services  Agreement by and between Titanium
Metals  Corporation  and the Registrant  effective as of January 1,
1998.

10.13 -  Intercorporate  Services  Agreement  by and between  CompX
International  Inc. and the  Registrant  effective as of January 1,
1998.

27.1 - Financial  Data  Schedule  for the  nine-month  period ended
September 30, 1998.

(b) REPORTS ON FORM 8-K

Reports on Form 8-K for the quarter  ended  September  30, 1998 and
through the date of this report:

August 28,  1998 - reported  Items 5 and 7.  
October  19,  1998 - reported  Items 5 and 7. 
October 21, 1998 - reported  Items 5 and 7.

- 26 -

SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

NL INDUSTRIES, INC.
-------------------------
(Registrant)

Date:  November 9, 1998                   By   /s/ Susan E. Alderton
- -----------------------                        ---------------------
Susan E. Alderton
Vice President and
Chief Financial Officer

Date:  November 9, 1998                   By   /s/ Dennis G. Newkirk
- -----------------------                        ---------------------
Dennis G. Newkirk
Vice President and Controller
(Principal Accounting Officer)

- 27 -

EXHIBIT 10.1

Dated 24 July 1998

IMPERIAL CHEMICAL INDUSTRIES PLC

and

E.I. DU PONT DE NEMOURS AND COMPANY

and

N L INDUSTRIES, INC.

1998
FRAMEWORK AGREEMENT

THIS AGREEMENT (the "AGREEMENT") is made on 24 July 1998 between:

(1) IMPERIAL CHEMICAL INDUSTRIES PLC, a company incorporated under the
laws of England,  whose registered  office is at Imperial Chemical
House, 9 Millbank, London, SW1P 3JF ("ICI");

(2) E.I. DU PONT DE NEMOURS AND COMPANY,  a  corporation  incorporated
under the laws of the State of Delaware, USA, having its principal
office at 1007  Market  Street,  Wilmington,  Delaware,  19898 USA
("DUPONT"); and

(3) N L INDUSTRIES, INC., a corporation incorporated under the laws of
the State of New Jersey, USA, whose principal place of business is
at 16825 Northchase Drive, Suite 1200,  Houston,  Texas, 77060 USA
(the "PURCHASER").

WHEREAS:
(A) ICI or Affiliates  of ICI are the holders of the Americas  Shares.
TEL is the owner of the Newco Business. ICI and DuPont have agreed
that  Tioxide  Group  Limited  will sell the TEL  Shares to DuPont
(U.K.) Limited.

(B) ICI,  DuPont and the  Purchaser  have agreed that,  subject to the
terms and conditions contained in this agreement, the transactions
described in recitals (C), (D) and (E) shall occur.

(C) The  Americas  Shares  will be sold by ICI or its  Affiliates  and
purchased  for  cash  by  the  Purchaser  or an  Affiliate  of the
Purchaser (or both).

(D) Immediately  following  completion  of the  TEL  Sale,  the  Newco
Business will be sold to Newco by TEL pursuant to the terms of the
Hivedown Agreement. Under the terms of the Hivedown Agreement, the
Newco Patent and Know-How  Licence is to be entered into providing
Newco  with  rights  necessary  for  the  operation  of the  Newco
Business as it will have been conducted  immediately  prior to the
completion  of the Newco Share Sale  Agreement.  The Newco  Shares
will immediately  thereafter be sold by TEL and purchased for cash
by the Purchaser or an Affiliate of the Purchaser (or both).

(E) The parties  have agreed to enter into this  agreement to set out,
among other  things,  the terms and  conditions on which each will
enter into  agreements  and cause their  Affiliates  to enter into
agreements  and to take  all  other  necessary  steps  in order to
implement the matters described in (C) and (D) above.

(F) The parties  have agreed to  guarantee  the  obligations  of their
respective Affiliates referred to above.

IT IS AGREED as follows:

1  INTERPRETATION

1.1  In this agreement:

"AFFILIATES"  means with respect to a specified entity, an entity that
directly or indirectly, through one or more intermediaries,  Controls,
or is  Controlled  by,  or is under  common  Control  with the  entity
specified,  provided  that,  without  limiting the  generality  of the
foregoing,  in  relation  to  ICI  and  DuPont  and  their  respective
subsidiary  companies,  the term  "AFFILIATES"  shall not  include any
entity  in  which a party  has a fifty  per  cent.  or less  ownership
interest.  For  the  purposes  hereof,   "Control"  means  possession,
directly or indirectly,  of the power to direct or cause the direction
of the management  and operating  policies of the entity in respect of
which the determination is being made, through the ownership of voting
securities, contract, voting trust or otherwise;

"AGREED  FORM" means,  in relation to any  document,  the form of that
document  which  has been  initialled  on the date this  agreement  is
signed  for the  purpose  of  identification  by or on  behalf  of the
parties to this  agreement  or, in  relation  to a document  that only
concerns certain parties, by such parties;

"AMERICAS BUSINESS" means the whole of the issued share capital of TAI
and the whole of the issued  share  capital of TCI  incorporating  the
entire  business and  operations of those  companies as of the date of
this   agreement  but  excluding   from  either  any  matter  or  item
attributable to the LPC Business;

"AMERICAS   IMPLEMENTATION   AGREEMENTS"   means  the  Americas   Sale
Agreements  and  those  other  agreements  to be  entered  into on the
Completion  Date by ICI or Affiliates of ICI as at the Completion Date
(or both) and the  Purchaser or  Affiliates of the Purchaser as at the
Completion  Date (or both)  under this  agreement  which are listed in
Schedule 2 Part II and are in Agreed Form,  unless otherwise stated in
such Schedule;

"AMERICAS  SALE" means the sale of the Americas Shares pursuant to the
Americas Sale Agreements;

"AMERICAS SALE AGREEMENTS" means the share sale agreements relating to
TAI and TCI ("AMERICAS  SHARE SALE  AGREEMENTS") to be entered into on
the Completion Date between ICI and/or  Affiliates of ICI, as the case
may  be,  and  the  relevant  Purchaser  Affiliate  and  the  Americas
Technology  Agreements and an "AMERICAS SALE  AGREEMENT"  means any of
them;

"AMERICAS SHARES" means:

135,000 common shares of TCI legally and beneficially  held at
the date hereof by Tioxide  Group  Limited and 37,000  Class A
Special  Shares of TCI  legally and  beneficially  held at the
date  hereof by ICI  Omicron  BV,  together  constituting  the
entire  issued  share  capital of TCI;  and  10,750  shares of
common stock of US$1 each in TAI legally and beneficially held
at the date hereof by ICI American Holdings Inc,  constituting
the entire issued share capital of TAI;

"AMERICAS TECHNOLOGY AGREEMENTS" means the agreements listed as 3.1 to
3.5, 5 and 6 in Schedule 2 Part II;

"BUSINESS  DAY" means a day (other than a Saturday or Sunday) on which
banks are  generally  open for normal  business in both London and New
York and (where any action is required by this  agreement  to be taken
in Canada) Montreal;

"BUSINESSES"  means the Newco Business,  the Americas Business and the
LPC Business and a reference  to  "BUSINESS"  means any one of them as
the context may require;

"COMPANIES" means TAI, TCI and Newco;

"COMPLETION DATE" has the meaning given to it in sub-Clause 2.7;

"CONDITIONS  PRECEDENT"  means  the  conditions  precedent  set out in
Schedule 1;

"CONSENTS"   means  all  such   licenses,   consents,   approvals  and
permissions  of third parties as may be necessary,  in order to enable
the Businesses to be carried on following the  Completion  Date in the
same  manner  as they are or shall be  carried  on at the date of this
agreement or the Completion Date (excluding any Permit);

"Data Rooms" means the room or rooms at the offices of Linklaters,  in
relation to the Newco  Business,  the  Americas  Business  and the LPC
Business (other than the LPC Interests),  containing  information made
available to the Purchaser and indexed in the Agreed Form;

"DEFAULT  INTEREST" means interest at the rate equal to LIBOR plus 200
basis points compounded monthly;

"DUPONT GROUP" means DuPont and its Affiliates at the Completion Date;

"ENTERPRISE VALUE" has the meaning ascribed thereto in Schedule 3;

"FINAL  DISCLOSURE  LETTERS" means the disclosure  letters from ICI in
relation to the Newco Sale  Agreements and from ICI in relation to the
Americas  Sale   Agreements  to  be  delivered  to  the  Purchaser  in
accordance respectively with Clauses 6 and 9;

"HIVEDOWN  AGREEMENT"  means the  agreement in the Agreed Form between
TEL and Newco relating to the sale of the Newco Business;

"HSR ACT" means the US Hart-Scott-Rodino Antitrust Improvements Act of
1976 (as amended) and the rules and regulations thereunder;

"HSR CONDITION" has the meaning given in Schedule 1;

"ICI'S AUDITORS" means KPMG Audit Plc of 8 Salisbury  Square,  London,
EC4Y 8BB;

"ICI GROUP" means ICI and its Affiliates from time to time;

"ICI'S CONTROLLER'S MANUALS" means the control manuals in existence at
14 July 1997 and which are  compiled in  accordance  with UK GAAP used
for accounting purposes within the ICI Group and which are recorded on
disk form as attached and  identified as Annex 1 (and which consist of
an  introduction  to the Group  Controller's  Manual,  Bulletin  Board
Accounting Language, Bulletin Board Reporting,  Accounting Definitions
and  Conventions,   Accounting  Policies  and  Procedures,   Controls,
Reporting);

"INDEPENDENT EXPERT" has the meaning given in sub-Clause 11.2;

"IMPLEMENTATION   AGREEMENTS"   means  the   Americas   Implementation
Agreements and the Newco Implementation Agreements;

"INITIAL  AMERICAS  DISCLOSURE  LETTER" means the disclosure letter in
the Agreed  Form in  relation  to the  Americas  Business  and the LPC
Business (other than the LPC Interests);

"INITIAL NEWCO DISCLOSURE  LETTER" means the disclosure  letter in the
Agreed Form in relation to the Newco Business;

"LIBOR"  means the rate for deposits in US Dollars for a period of one
month  which  appears on the  Reuters  Screen ISDA Page (or such other
page as the parties  may agree) at  approximately  11.00 a.m.,  London
time,  on the first day of the  period  to which any  interest  period
relates  (the  "RELEVANT  DATE").  If such rate does not appear on the
Reuters  Screen  ISDA  Page on the  Relevant  Date,  the rate for that
Relevant Date will be determined as if the parties had specified  that
the rate for the Relevant  Date will be determined on the basis of the
rates at which  deposits in US Dollars are offered by Midland Bank plc
at  approximately  11.00 a.m.,  London time,  on the Relevant  Date to
prime banks in the London  interbank  market for a period of one month
commencing on that Relevant Date for amounts of US$10,000,000;

"LONGSTOP DATE" means 31 December 1998;

"LPC" means the Louisiana Pigment Company,  Limited Partnership,  care
of The  Corporation  Trust  Company,  Corporation  Trust Centre,  1200
Orange Street, Wilmington, Delaware 19801 USA;

"LPC BUSINESS" means the LPC Interests, sales sourced from LPC and any
Stocks, Operating Debtors, Operating Creditors less than one year (the
definitions  of such  terms in  Schedule  3 being  applied to LPC) and
other  assets  or  liabilities  relating  to  LPC  as  determined  and
distinguished from the Americas Business in accordance with Schedule 5
to this agreement;

"LPC  INTERESTS"  means all  partnership  interests held by ICI or its
Affiliates in LPC pursuant to the Joint Venture  Agreement dated as of
18 October 1993, as amended, between TAI and Kronos Louisiana, Inc.;

"LPC  TERMINATION  AGREEMENT"  means  the  agreement  listed  as  5 in
Schedule 2 Part II;

"NBQ" means the land known as Nettleton  Bottom Quarry as defined in a
conveyance  dated 1 June 1978  between  Roade  Aggregates  Limited and
Apollo Site Services Limited;  "NEWCO" means a subsidiary of TEL being
the  purchaser  of  the  Newco  Business   pursuant  to  the  Hivedown
Agreement;

"NEWCO  BUSINESS"  means the business to be sold to Newco  pursuant to
the Hivedown Agreement;

"NEWCO IMPLEMENTATION  AGREEMENTS" means the Newco Sale Agreements and
those other  agreements  which are listed in Schedule 2 Part I and are
in Agreed Form, unless otherwise stated in such Schedule;

"NEWCO  PATENT AND KNOW-HOW  LICENCE"  means the licence in the Agreed
Form to be  entered  into  between  DuPont and Newco  pursuant  to the
Hivedown Agreement;

"NEWCO SALE" means the sale of Newco to the  Purchaser  in  accordance
with the Newco Sale Agreements;

"NEWCO SALE AGREEMENTS" means the share sale agreement relating to the
sale of Newco ("NEWCO SHARE SALE AGREEMENT") to be entered into on the
Completion Date between TEL and the relevant Purchaser Affiliate,  the
Hivedown Agreement and the Newco Technology  Agreements;  and a "NEWCO
SALE AGREEMENT" means any one of them;

"NEWCO SHARES" means all the issued share capital of Newco held by TEL
following  completion  of the TEL Sale and to be sold to the Purchaser
or the relevant  Purchaser  Affiliate pursuant to the Newco Share Sale
Agreement;

"NEWCO  TECHNOLOGY  AGREEMEnts"  means the Newco  Patent and  Know-How
Licence and the agreements listed as 4.1 to 4.4 in Schedule 2 Part I;

"ORDINARY  COURSE OF BUSINESS"  means the ordinary  course of business
consistent   with  past  custom  and   practice   including,   without
limitation,  quantity and frequency, taking into account the relevance
and  reasonableness  of the  same  and  with  allowance  made  for the
inherently cyclical nature of the titanium dioxide industry;

"PERMITS" means all licences, permits,  authorisations,  registrations
and approvals  (formal and informal)  required by law or regulation or
issued or granted by statutory or local  authorities  to the Seller or
the relevant  Company for the purposes of operation of the  Businesses
(but  excluding  planning  permissions  issued  by  relevant  planning
authorities (save for  Environmental  Authorisations as defined in the
relevant Implementation Agreements) and the Regulatory Conditions);

"PROPOSED  TRANSACTIONS"  means the  transactions  (other than the TEL
Sale) contemplated by Clauses 3 and 4;

"PURCHASER  GROUP" means the Purchaser and its Affiliates from time to
time;

"RECORD DATE" has the meaning given in sub-Clause 2.5;

"REGULATORY  CONDITIONS" means the anti-trust approvals referred to in
sub-Clause 2.3.1;

"SALE  AGREEMENTS"  means the Newco Sale  Agreements  and the Americas
Sale Agreements;

"SELLER" means the relevant  entity holding the relevant  shares to be
sold or other assets to be  transferred or rights to be granted under,
as the context may require, the Newco Sale Agreements and the Americas
Sale Agreements;

"TAI" means Tioxide Americas Inc, a corporation incorporated under the
laws of the State of Delaware,  USA of 2001  Butterfield  Road,  Suite
601, Downers Grove, Illinois 60515, USA;

"TCI" means Tioxide Canada Inc, a corporation  incorporated  under the
laws of the Province of Quebec,  Canada (registered number 1140405920)
of 1690 Route Marie Victorin, Tracy, Quebec, J3R IM7, Canada;

"TEL" means Tioxide Europe Limited, a company  incorporated in England
(registered number 832447) of Lincoln House, 137/143 Hammersmith Road,
London W14 OQL;

"TEL COMPLETION DATE" means the time of completion of the TEL Sale;

"TEL SALE" means the sale of the TEL Shares by Tioxide  Group  Limited
to Du Pont (U.K.) Limited;

"TEL SHARES" means the entire issued share capital of TEL;

"UK GAAP" means generally accepted accounting principles in the United
Kingdom; and

"WSL  CONTRACT"  means  the  purchase  contract  dated 28 May 1987 (as
amended) for the supply of ilmenite  between (1) Tioxide  Group plc as
agent for TEL  (formerly  Tioxide UK Ltd),  Tioxide  Australia Ltd and
Tioxide Espana S.A. and (2) Westralian Sands Ltd.

1.2 Any express reference to an enactment includes references to:

1.2.1   that enactment as amended, extended or applied by or under any
other enactment before or after this agreement;

1.2.2   any enactment which that enactment  re-enacts (with or without
modification); and

1.2.3   any  subordinate   legislation  made  (before  or  after  this
agreement)   under  any   enactment,   including   one  within
sub-Clauses 1.2.1 or 1.2.2 above,

except  to  the  extent  that  any  of  the  matters  referred  to  in
sub-Clauses  1.2.1 to 1.2.3 occurring after the date of this agreement
increase or alter the liability of any party under this agreement.

1.3  The  singular  shall  include  the  plural  and vice  versa  and words
denoting  persons shall include  bodies  corporate and  unincorporated
associations of persons and, unless  otherwise  stated,  shall include
permitted successors or assigns of such persons.

1.4  Sub-Clauses 1.1 to 1.3 apply unless the contrary intention appears.

1.5  The headings in this agreement do not affect its interpretation.

1.6  Any  Schedule or Annex to this  agreement  shall take effect as if set
out in this agreement and  references to this agreement  shall include
its Schedules and Annexes.

2  CONDITIONS PRECEDENT

2.1  The  obligations of the parties under Clauses 3 and 4 and  sub-Clauses
16.1 and 16.2 are subject to the  Conditions  Precedent and completion
of this agreement is subject to sub-Clause 2.8.

2.2  The  parties  shall use all  reasonable  efforts to  procure  that the
Conditions  Precedent are fulfilled as soon as possible after the date
of this agreement.

2.3

2.3.1   Subject  to  the  terms  and   conditions  of this  agreement,
each party will use all  reasonable  efforts to take, or cause
to be taken,  all actions and to do, or cause to be done,  all
things necessary, proper or advisable in relation to antitrust
and  regulatory  approvals  necessary to complete the Proposed
Transactions.  In  furtherance  and not in  limitation  of the
foregoing,  each party agrees to make an appropriate filing of
a  Notification  and Report Form  pursuant to the HSR Act with
respect  to  the   Proposed   Transactions   as   promptly  as
practicable  and in any event  within 10 Business  Days of the
date  hereof  and to supply as  promptly  as  practicable  any
additional  information and  documentary  material that may be
reasonably  requested  pursuant to the HSR Act and to take all
other actions  necessary or desirable to cause the  expiration
or termination of the applicable waiting periods under the HSR
Act as soon as practicable.

2.3.2   Each party shall, in connection  with the efforts  referred to
in sub-Clause 2.3.1:

(i) use all  reasonable  efforts to co-operate in all respects
with  each  other  in   connection   with  any  filing  or
submission, or the timing thereof;

(ii)in connection  with any  investigation  or other  inquiry,
including  any  proceeding  initiated by a private  party,
keep the other  parties  informed on a timely basis in all
material respects of any material  communication  received
by such party from,  or given by such party to, the Office
of Fair  Trading (the "OFT"),  the  Bundeskartellamt  (the
"BK"), the European  Commission (the "EC"), the US Federal
Trade  Commission (the "FTC"),  the Antitrust  Division of
the US  Department  of  Justice  (the  "DOJ") or any other
governmental  authority and of any material  communication
received or given in connection  with any  proceeding by a
private party,  in each case regarding any of the Proposed
Transactions,  and  permit  any other  party to review any
material communication given by or to it; and

(iii) consult  with each  other,  in advance of any meeting or
conference  with  such  governmental  authorities  or,  in
connection  with any proceeding by a private  party,  with
any other person  provided that in relation to unsolicited
communications,  the obligations in this sub-Clause  shall
be such as are practicable in the relevant circumstances.

2.3.3   The  parties  will  use  all  reasonable  endeavours to obtain
such  approvals  as promptly as possible  and, in this regard,
provide all information reasonably requested, shall assist and
co-operate with one another to make the necessary  filings and
take  such  other  steps  as  may be  commercially  reasonably
required to secure the non-objection of the relevant antitrust
and  regulatory  authorities,  provided  that  nothing in this
sub-Clause  2.3.3 shall be  construed  to require any party to
conduct  its  commercial  affairs  in a manner  other  than in
accordance with its own independent business judgement.

2.3.4   The parties will use all reasonable efforts to take all action
and to do all things necessary in order to consummate and make
effective  the  transactions  contemplated  by this  agreement
(including  satisfaction,  but not waiver,  of all  Conditions
Precedent).

2.4  The Conditions  Precedent  shall be deemed to have been fulfilled when
they have been satisfied within the terms described in Schedule 1.

2.5  Each  party  shall  promptly  advise the  others  once the  Conditions
Precedent  which  relate to that party have been  fulfilled.  The date
that  the  last of the  Conditions  Precedent  (other  than  Condition
Precedent  number 12 relating  to the TEL Sale) has been so  fulfilled
shall be the "Record Date" and the Completion Date shall be determined
in accordance with the provisions of sub-Clause 2.7 below. The parties
shall be deemed to have satisfied or waived any  Conditions  Precedent
(as  applicable)  by signing and  completing  the Sale  Agreements  in
accordance with sub-Clause 2.7 below.

2.6  If the Conditions  Precedent (other than Condition Precedent number 12
relating  to the TEL Sale)  have not been  fulfilled  by the  Longstop
Date,  or earlier upon the written  agreement of the parties that such
Conditions  Precedent  cannot so be met, any of the parties shall have
the right (but not the  obligation)  to  terminate  this  agreement by
notice in writing,  to be given after the Longstop  Date or earlier by
written  agreement  between the parties,  in which case no party shall
have any rights or  obligations  under  this  agreement  except  under
Clauses 14, 15, 19, 25 and 26 which shall survive the  termination  of
this agreement.

2.7  The TEL Sale shall be  completed  at midnight  London time on the last
day of the  calendar  month  (or if that last day is a Friday or not a
Business Day on the first Business Day thereafter) following the month
in which the Record Date falls.  The date and time of signature and of
completion  of the Hivedown  Agreement and any documents to be entered
into pursuant  thereto will be  immediately  thereafter.  The date and
time of  signature  and  completion  (the  "Completion  Date"  for the
purposes  of this  agreement)  of the other  Sale  Agreements  will be
immediately following completion of the Hivedown Agreement as referred
to above.

2.8  The parties agree that:

(a)     the signature and completion of the Sale  Agreements  will not
take place unless  completion of the TEL Sale has taken place;
and

(b)     the signature  and  completion of each of the Newco Share Sale
Agreement and each of the Americas Share Sale  Agreements will
be  simultaneous  and none will be  completed  unless  all are
completed.

2.9  Immediately  after the TEL  Completion  Date but before  the  Hivedown
Agreement is entered into,  the Purchaser  shall serve written  notice
upon  DuPont and TEL and DuPont  shall  procure  TEL to serve  written
notice on the Purchaser,  in each case  confirming that all conditions
precedent  to the  Newco  Sale  are  satisfied  and  that  TEL and the
Purchaser  each  has an  unconditional  obligation  pursuant  to  this
agreement  to execute and  complete  the Newco  Share Sale  Agreement.
Accordingly,  TEL will have ceased to be the  beneficial  owner of the
Newco Shares before the Hivedown Agreement is entered into.

3  IMPLEMENTATION, CONSIDERATION AND ADJUSTMENT

3.1  Subject to the prior  satisfaction  of the Conditions  Precedent,  the
parties  will and will procure that their  relevant  Affiliates  enter
into and complete in the following order:

3.1.1   in accordance with Clause 2.7 (so as to take place immediately
following  completion of the TEL Sale), the Hivedown Agreement
and  any  deed,  document  or  agreement  to be  entered  into
pursuant thereto; and

3.1.2   on the Completion Date, the  Newco  Implementation  Agreements
and the Americas Implementation Agreements.

3.2  The consideration due to the relevant parties in relation to the sales
of the Americas  Shares and the Newco Business and the LPC Termination
Agreement  contemplated under the  Implementation  Agreements shall be
calculated   in   accordance   with   Schedule  3  and  the   relevant
Implementation  Agreements.  The  Enterprise  Value  for  each  of the
Americas  Business,  the LPC Business  (excluding the value of the LPC
Interests) and the Newco Business and the agreed consideration for the
LPC Interests shall be as shown in Schedule 3.

4  TECHNOLOGY AGREEMENTS

On the Completion Date the parties will and/or will procure that their
relevant  Affiliates will enter into and complete the Newco Technology
Agreements and Americas Technology Agreements.

5  CONDUCT OF BUSINESS

5.1  Pending the  execution and delivery of the  Implementation  Agreements
(or the  earlier  termination  of  this  agreement),  neither  ICI nor
DuPont,  nor  any of  their  Affiliates,  nor any of  their  officers,
employees,  representatives  or agents,  will  solicit or initiate any
discussions or negotiations  with, or participate in any  negotiations
with,  or provide any  information  to or  otherwise  cooperate in any
other way with,  or  facilitate or encourage any effort or attempt by,
any corporation,  partnership,  person or other entity or group (other
than NL, its Affiliates and its directors, officers, employees, agents
and  representatives)  concerning  any  acquisition  of  the  Americas
Shares, the Intellectual Property which is the subject of the Americas
Technology  Agreements,  the LPC Interests,  the Newco  Business,  the
Newco Shares, or the Intellectual Property which is the subject of the
Newco Technology Agreements.

5.2  ICI agrees,  pending the execution and delivery of the  Implementation
Agreements (or the earlier termination of this agreement),  to conduct
each of the Businesses  only in the Ordinary  Course of Business.  ICI
shall also use its reasonable  commercial  endeavours to: (i) maintain
the business and  properties of TAI, TCI and the Newco  Business,  and
preserve intact their business  organisations and goodwill,  (ii) keep
available  the  services of their  officers  and  employees  and (iii)
maintain  satisfactory  relationships  with  suppliers,  customers and
others having a business relationship with the Businesses.

6  ICI WARRANTIES AND REPRESENTATIONS

6.1 ICI warrants and represents to the Purchaser that:

6.1.1   subject to satisfaction  of the Conditions  Precedent (in each
case in relation to the obligations  referred to in sub-Clause
2.1 but not in relation to any other obligations):

(i) it has the  requisite  power and  authority to enter  into
and perform this agreement;

(ii)it has obtained and  satisfied all  corporate,  regulatory
and other approvals, or any other conditions, necessary to
execute and perform this agreement;

(iii) this agreement constitutes the legally valid and binding
obligations  of ICI  enforceable  in  accordance  with its
terms; and

(iv)compliance  with  the  terms  of this  agreement  and each
relevant  Americas   Implementation   Agreement  will  not
constitute a default under any provision of:

(a)  ICI's memorandum or articles of association; or

(b)  (i) any  order,  judgment  or  decree;  or  (ii)  any
statute,  rule or  regulation;  or  (iii)  any  other
restriction of any kind by which ICI is bound; and

6.1.2   none of ICI and its  Affiliates  has employed  any  investment
banker,  broker or finder,  or incurred any  liability for any
brokerage fees, commissions, finder's fees or similar payments
in  connection  with the Proposed  Transactions  for which the
Purchaser or its Affiliates or any of the Companies or LPC may
be liable.

6.2  ICI and the Purchaser  agree that the Warranties to be given under the
Americas Share Sale Agreements (in this Clause,  Warranties having the
meaning given in the relevant  Americas Share Sale  Agreement) will be
given at the  Completion  Date and will be given subject to any matter
which is fairly disclosed in the Final Disclosure Letter applicable to
each Americas Share Sale  Agreement.  ICI and the Purchaser agree that
ICI may require to amend the Initial Americas Disclosure Letter or the
Disclosure  Documents (as defined in the Initial  Americas  Disclosure
Letter) (together in this Clause 6, the "INITIAL  AMERICAS  DISCLOSURE
DOCUMENTS")  in  accordance  with  sub-Clause  6.3 below by adding to,
amending or removing  the  specific  matters  identified,  referred to
and/or  disclosed  therein  in each  case in the  event of them  being
incomplete or inaccurate.

6.3  ICI  undertakes to the Purchaser  that it will fairly  disclose to the
Purchaser  in writing any matter or thing known to ICI before or after
the date of this agreement and prior to the TEL Completion Date which,
if not disclosed,  would  constitute a breach of any of the Warranties
(if  they  had been  given  at the  date of this  agreement)  or which
constitutes an amendment which is required  pursuant to sub-Clause 6.2
above in order to amend any factual errors or omissions in the Initial
Americas Disclosure  Documents.  Such disclosure or any such amendment
shall be made not later than 14 days before the TEL Completion Date in
respect of  matters or things  which are known to ICI at or before the
Record Date and shall be incorporated in the Final  Disclosure  Letter
applicable  to each  Americas  Share Sale  Agreement.  In  relation to
matters  or things  which  only  become  known to ICI after the Record
Date,  such  disclosure  or  amendment  shall be fairly  disclosed  or
communicated  in  writing  as  soon  as  practicable  before  the  TEL
Completion  Date and shall be  incorporated  in the  Final  Disclosure
Letter  applicable to each Americas  Share Sale  Agreement.  ICI shall
provide  the  Purchaser  with  amendments  to  the  Initial   Americas
Disclosure  Documents  on a regular  basis  (being  every  four to six
weeks)  during the period from the date  hereof to the TEL  Completion
Date.

Any  such  amendments  to the  information  contained  in the  Initial
Americas Disclosure  Documents shall, to constitute a valid disclosure
against the  Warranties,  be required to be expressly  incorporated in
the Final  Disclosure  Letters  applicable to the Americas  Share Sale
Agreements.

ICI undertakes to the Purchaser that only those specific categories of
general  disclosure  contained  in  the  Initial  Americas  Disclosure
Letters will be contained in the Final Disclosure  Letters in relation
to the Americas Sale Agreements and that such specific categories will
not be amended in any way.

7  PURCHASER'S WARRANTIES AND REPRESENTATIONS

7.1 The Purchaser warrants and represents to ICI and DuPont that:

7.1.1   subject to satisfaction  of the Conditions  Precedent (in each
case in relation to the obligations  referred to in sub-Clause
2.1 but not in relation to any other obligation):

(i) it has the  requisite  power and  authority  to enter into
and to perform this agreement;

(ii)it has obtained and  satisfied all  corporate,  regulatory
and other approvals,  or any other significant conditions,
necessary to execute and perform this agreement;

(iii) this agreement constitutes the legally valid and binding
obligations  of the  Purchaser  enforceable  in accordance
with its terms; and

(iv)compliance  with  the  terms  of this  agreement  and each
relevant  Implementation  Agreement  will not constitute a
default under any provision of:

(a)  the  Purchaser's  by-laws  or  other   constitutional
documents; or

(b)  (i) any  order,  judgment  or  decree;  or  (ii)  any
statute,  rule  or  regulation  or  (iii)  any  other
restriction  of any kind by which  the  Purchaser  is
bound; and

7.2  none of the Purchaser and its  Affiliates  has employed any investment
banker,  broker or finder, or incurred any liability for any brokerage
fees,  commissions,  finder's  fees or similar  payments in connection
with the  Proposed  Transactions,  for  which  ICI or  DuPont or their
Affiliates  (excluding,  following the Completion  Date, the Companies
and LPC) may be liable.

8  DUPONT WARRANTIES AND REPRESENTATIONS

DuPont warrants and represents to the Purchaser that:

8.1  subject to satisfaction  of the Conditions  Precedent (in each case in
relation to the  obligations  referred to in sub-Clause 2.1 but not in
relation to any other obligation):

(i) it  has  the  requisite   power  and   authority  to enter
into and to perform this agreement;

(ii)it has obtained and  satisfied all  corporate,  regulatory
and other approvals,  or any other significant conditions,
necessary to execute and perform this agreement;

(iii) this agreement constitutes the legally valid and binding
obligations of DuPont  enforceable in accordance  with its
terms; and

(iv)compliance  with  the  terms  of this  agreement  and each
relevant   Newco   Implementation   Agreement   will   not
constitute a default under any provision of:

(a)  DuPont's by-laws or  other  constitutional documents;
and

(b)  (i)  any  order,   judgment  or  decree;  or  (ii)any
statute,  rule or  regulation;  or  (iii)  any  other
restriction of any kind by which DuPont is bound;

8.2  none of DuPont or its Affiliates  has employed any investment  banker,
broker or finder,  or incurred any liability  for any brokerage  fees,
commissions,  finder's fees or similar payments in connection with the
Newco Sale Agreements for which the Purchaser or its Affiliates or any
of the Companies may be liable.

9  NEWCO DISCLOSURE DOCUMENTS

9.1  ICI and the Purchaser  agree that the Warranties to be given under the
Newco  Share Sale  Agreement  (in this  Clause  Warranties  having the
meaning given in the Newco Share Sale  Agreement) will be given at the
Completion  Date and  will be given  subject  to any  matter  which is
fairly  disclosed in the Final  Disclosure  Letter  applicable  to the
Newco Share Sale  Agreement.  ICI and the Purchaser agree that ICI may
require to amend the Initial Newco Disclosure Letter or the Disclosure
Documents  (as  defined  in  the  Initial  Newco  Disclosure   Letter)
(together,  the "INITIAL  NEWCO  DISCLOSURE  DOCUMENTS") in accordance
with  sub-Clause  9.2 below by adding to,  amending  or  removing  the
specific matters  identified,  referred to and/or disclosed therein in
each case in the event of them being incomplete or inaccurate.

9.2  ICI  undertakes to the Purchaser  that it will fairly  disclose to the
Purchaser  in writing any matter or thing known to ICI before or after
the date of this agreement and prior to the TEL Completion Date which,
if not disclosed,  would  constitute a breach of any of the Warranties
(if  they  had been  given  at the  date of this  agreement)  or which
constitutes an amendment which is required  pursuant to sub-Clause 9.1
above in order to amend any factual errors or omissions in the Initial
Newco  Disclosure  Documents.  Such  disclosure or any such  amendment
shall be made not later than 14 days before the TEL Completion Date in
respect of  matters or things  which are known to ICI at or before the
Record Date and shall be incorporated in the Final  Disclosure  Letter
applicable to the Newco Share Sale  Agreement.  In relation to matters
or things  which only  become  known to ICI after the Record Date such
disclosure or amendment  shall be fairly  disclosed or communicated in
writing  as soon as  practicable  before the TEL  Completion  Date and
shall be incorporated in the Final Disclosure Letter applicable to the
Newco  Share Sale  Agreement.  ICI shall  provide the  Purchaser  with
amendments  to the Initial  Newco  Disclosure  Documents  on a regular
basis (being every four to six weeks)  during the period from the date
hereof to the TEL Completion Date.

Any such amendments to the information  contained in the Initial Newco
Disclosure  Documents shall, to constitute a valid disclosure  against
the Warranties,  be required to be expressly incorporated in the Final
Disclosure Letter applicable to the Newco Share Sale Agreement.

ICI undertakes to the Purchaser that only those specific categories of
general  disclosure  contained in the Initial Newco Disclosure  Letter
will be  contained in the Final  Disclosure  Letter in relation to the
Newco Sale  Agreements and that such specific  categories  will not be
amended in any way.

10  TRIGGER EVENTS

10.1  If in consequence of any one or more Trigger Events (as defined below)
there is a Material  Adverse  Effect (as defined  below)  which is not
remedied by ICI or its  Affiliates  at no cost to the Purchaser or, as
the case may be TAI or TCI or Newco,  before the TEL Completion  Date,
then,  provided the  Purchaser or its  Affiliates  have not  knowingly
caused or contributed  to such Material  Adverse Effect (to the extent
it would not have  constituted  such a Material Adverse Effect without
such  contribution),  the  Purchaser  shall have the right,  by notice
served on both ICI and DuPont at any time  during the period  from the
date of this  agreement  to  immediately  prior to the TEL  Completion
Date, to terminate its obligation to purchase the Newco Shares and the
Americas  Shares  which in the event of  exercise of such right by the
Purchaser shall be its exclusive remedy and shall extinguish any claim
by the Purchaser or any of its Affiliates for damages (whether arising
in contract,  tort or  otherwise) in  connection  with this  agreement
provided that on such  termination  the  provisions of sub-Clause  2.6
shall apply mutatis mutandis.

10.2  In the  event  that  there  is a  dispute  as to  whether  a right  to
terminate under  sub-Clause 10.1 exists,  the matter shall be referred
to  the  Independent  Expert  for  determination  in  accordance  with
sub-Clause  11.2.  If  completion  of the Sale  Agreements  would have
occurred but for the application of the provisions of sub-Clause 10.1,
and if the  determination  is that  the  right to  terminate  does not
exist, the date of that  determination  shall be treated as the Record
Date for the purposes of sub-Clause 2.5 and this Clause shall apply in
relation to the new Record Date.

10.3 For the purposes of this Clause 10:

"TRIGGER EVENT" means:

10.3.1  any  amendment  to  or   variation   of  the   Initial   Newco
Disclosure   Documents  or  the  Initial  Americas  Disclosure
Documents or other disclosure  pursuant to sub-Clauses 6.3 and
9.2 in the period  following  signature of this  agreement and
before  the TEL  Completion  Date in  respect of any matter or
thing  which  but  for  notification  to the  Purchaser  under
sub-Clauses 6.3 and 9.2 above would constitute a breach of the
Warranties (as defined in sub-Clauses 6.2 and 9.1) if they had
been  given at the  date of this  agreement  or the  Purchaser
otherwise  becoming  aware,  without  being in  breach of this
agreement,  of a matter  or thing  which  would  constitute  a
breach of such Warranties,  if they had been given at the date
of this agreement; or

10.3.2  without prejudice to sub-Clause  10.3.1 above,  where any such
amendment or variation is made to correct an error or omission
in the information  contained in the Initial Newco  Disclosure
Documents or the Initial Americas  Disclosure  Documents,  the
Purchaser  shall be entitled to use such  information  for the
purpose  of  calculating  whether,  together  with  any  other
Trigger Event(s), a Material Adverse Effect has occurred; or

10.3.3  contractual  terms not being available  (immediately  prior to
the expiry of the period  referred to in sub-Clause  10.1) for
the Newco Business to be supplied,  for a period of at least 2
years following the Completion  Date, with volumes of ilmenite
ore consistent  with those consumed by the Newco Business over
the 12 months  ending on the date of this  agreement at prices
substantially  similar  to those  payable by TEL under the WSL
Contract from time to time.

"MATERIAL ADVERSE EFFECT" means a diminution in the aggregate value of
the Americas  Business and the Newco  Business  having regard to their
aggregate Enterprise Value as determined by reference to Schedule 3 of
US$35,000,000  or more as a result of any one or more  Trigger  Events
occurring   prior  to  the  TEL  Completion  Date  ignoring  any  such
diminution:  (a) which would be reflected in an adjustment pursuant to
the  provisions  of this  agreement or the Sale  Agreements  as at the
Completion Date to the aggregate consideration for the purchase of the
Americas Shares or the Newco Business;  and (b) to the extent that the
diminution  in  value  has  been  remedied  by ICI at no  cost  to the
relevant  Companies  or  Businesses  Provided  that where any  adverse
effect  arising  from one or more Trigger  Event(s) is not  reasonably
capable of calculation in monetary terms, the question as to whether a
Material  Adverse  Effect has occurred  whether  wholly or partly as a
result of such Trigger Event(s) shall,  failing  agreement between the
parties, be determined by the Independent Expert.

11  INDEPENDENT ACCOUNTANT AND EXPERT

11.1  INDEPENDENT    ACCOUNTANT

11.1.1  If  any   party  (a  "COMPLAINANT")   wishes   to  refer   any
matter  in  dispute  in   accordance   with   Schedule  3  for
determination  under this Clause,  it shall give notice to the
others  (or if the  matter  concerns  only  one or some of the
others,  then only to such  other or  others)  (the  "OTHERS")
requiring the appointment of an independent accounting firm of
international   reputation  (the  "INDEPENDENT   ACCOUNTANT").
Accounting firms who have acted as auditors of the Complainant
or the Others or their respective Affiliates,  during the five
years preceding the date of this agreement,  shall be excluded
from such  appointment.  If the Complainant and the Others are
unable to agree upon the Independent Accountant within 14 days
of such  notice,  then  the  Independent  Accountant  shall be
appointed by the President for the time being of the Institute
of  Chartered   Accountants   in  England  and  Wales  on  the
application of either the Complainant or any of the Others.

11.1.2  If the Independent  Accountant  delays or becomes unwilling or
incapable of acting or if for any other  reason the  President
for the time being of the  Institute of Chartered  Accountants
in  England  and  Wales  thinks  fit  he  may   discharge  the
Independent  Accountant  and,  in  the  absence  of  agreement
between the Complainant and the Others, appoint another in its
place.

11.1.3  The Independent  Accountant  shall act as an expert and not as
an  arbitrator  and its  decision  shall  (in the  absence  of
manifest  error) be final and binding on the  Complainant  and
the  Others.  The  Independent  Accountant  shall  afford  the
Complainant  and the Others the  opportunity of making written
representations to it and shall make its determination  within
40 days of its appointment.

11.1.4  The fees and expenses of the Independent  Accountant  shall be
borne by the Complainant and the Others in equal shares unless
the Independent Accountant otherwise determines.

11.2  INDEPENDENT EXPERT

11.2.1  If  a  Complainant  wishes  to  refer  any  matter  in dispute
for determination  under this sub-Clause 11.2, the Complainant
may give  notice  to the  Others  requiring  the  matter to be
referred to an independent  expert (the "INDEPENDENT  EXPERT")
agreed by the Complainant  and the Others.  If the Complainant
and the Others are unable to agree upon the Independent Expert
within  14 days of such  notice  then the  Independent  Expert
shall be  appointed  by the chairman for the time being of the
Institute of Arbitrators on the application of the Complainant
or any of the Others.

11.2.2  If the  Independent  Expert  delays or  becomes  unwilling  or
incapable  of acting or if for any other  reason the  chairman
for the time being of the Institute of Arbitrators  thinks fit
he may discharge the Independent Expert and, in the absence of
agreement  between the  Complainant  and the  Others,  appoint
another in his or her place.

11.2.3  The  Independent  Expert  shall act as an expert and not as an
arbitrator  and his or her  decision  shall (in the absence of
manifest  error) be final and binding on the  Complainant  and
the  Others.   The   Independent   Expert   shall  afford  the
Complainant  and the Others the  opportunity of making written
representations  to him  or  her  and  shall  make  his or her
determination within 40 days of appointment.

11.2.4  The fees and expenses of the Independent Expert shall be borne
by the  Complainant  and the Others in equal shares unless the
Independent Expert otherwise determines.

12  LIABILITY IN RELATION TO THE NEWCO SALE AND THE HIVEDOWN AGREEMENT

12.1  The Purchaser agrees for itself and in respect of its Affiliates that,
other than as  expressly  provided  in this  agreement,  the  Americas
Implementation Agreements and the Newco Implementation  Agreements, no
representation  or  warranty  is given  (express  or  implied)  and no
liability  is  accepted  by ICI,  DuPont  or any of  their  respective
Affiliates or any of their respective directors,  employees, agents or
advisers (respectively the "ICI SELLING GROUP" and the "DUPONT SELLING
GROUP" and  together  the  "SELLING  GROUP"),  as to the  accuracy  or
completeness  of any  information  in the Data  Rooms (or any  further
information  supplied  on request  or any  communication  in  relation
thereto) or as to the  reasonableness  of any assumptions on which any
of it is based.

12.2  The Purchaser for itself and in respect of its  Affiliates  (including
the  Companies  for the purpose of this Clause 12) agrees that,  other
than as a result  of fraud on the part of  either  any  member  of the
DuPont  Selling  Group or of any  member of the ICI  Selling  Group as
relevant (in which case only the members of the relevant Selling Group
shall be liable):

(i) no member of the Selling  Group shall incur any  liability
whatsoever  to the  Purchaser  or  any  of its  Affiliates
arising out of or in connection  with the  acquisition  of
the Newco Shares or the Americas  Shares and entry into by
the  Purchaser  of  the  Newco  Sale  Agreements  and  the
Americas Sale Agreements; and

(ii)the  Purchaser  shall  have no right of action  whatsoever
against any member of the Selling Group in connection with
or arising out of the purchase of the Companies;

both  other  than  as  provided  in  this   agreement,   the  Americas
Implementation Agreements and the Newco Implementation Agreements.

12.3  The Purchaser for itself and its Affiliates  undertakes to the Selling
Group to waive any liability which such parties may incur by reason of
the  Purchaser's  or its  Affiliates'  use  of or  reliance  upon  any
information or documentation provided by such party and their advisers
in  relation to the sale of the  Companies,  other than as provided in
this agreement,  the Americas Implementation  Agreements and the Newco
Implementation Agreements.

12.4  It is agreed that none of ICI,  DuPont,  the Purchaser or any of their
respective  Affiliates  are partners under this agreement or any other
agreement  herein referred to for any purpose,  except the partnership
agreement  dated 20 December 1993 (as amended)  between  Affiliates of
ICI and Affiliates of the Purchaser with respect to LPC.

12.5  The Purchaser acknowledges (for itself and its Affiliates) that DuPont
and ICI have agreed between themselves arrangements in the Agreed Form
regarding   the   conduct  of  any  claim   under  any  of  the  Newco
Implementation  Agreements  which also gives rise to or  constitutes a
claim  under  the  same or  equivalent  provisions  of the  agreements
between ICI or any of its  Affiliates  (on the one hand) and DuPont or
any of its Affiliates (on the other hand) relating to the TEL Sale.

If DuPont  notifies the Purchaser  that the conduct of any claim under
any  of the  Newco  Implementation  Agreements  is to be  assumed  and
controlled by ICI or any of its  Affiliates  in  accordance  with such
arrangements  then the Purchaser  agrees  (subject to the terms of the
Newco Implementation Agreements) to co-operate and deal accordingly so
that references in the Newco Implementation Agreements to "the Seller"
in the  context of the  conduct  of any such claim  shall be deemed to
mean ICI or any of its  Affiliates  and the Purchaser  (for itself and
its Affiliates)  acknowledges that any payment or settlement by ICI or
any  of  its  Affiliates  to or  with  the  Purchaser  (or  any of its
Affiliates)  in respect of any claim made by the  Purchaser (or any of
its  Affiliates)  against  DuPont or its  Affiliates  under any of the
Newco   Implementation   Agreements  shall  discharge  DuPont  or  its
Affiliates'  liability  to the  Purchaser  (or any of its  Affiliates)
under any such Newco Implementation Agreement in respect of such claim
to the extent of any payment or settlement so made.  The provisions of
this Clause are without prejudice to the Purchaser's  rights under the
Newco Implementation Agreements.

12.6  It is agreed  between  DuPont  and the  Purchaser  (for  itself and on
behalf of Newco) that in circumstances where the subject matter of any
claim under any of the Newco Implementation Agreements also gives rise
to or constitutes a claim or dispute  between DuPont or its Affiliates
and  Newco  under  or  pursuant  to the  Hivedown  Agreement  then the
provisions  of the Newco  Implementation  Agreements  dealing with the
notification,   assistance  and  conduct  of  any  claim,  dispute  or
proceedings  shall  prevail  over and override  any  corresponding  or
similar provisions contained in the Hivedown Agreement.  The Purchaser
shall procure that Newco complies with the provisions of this Clause.

12.7

12.7.1  ICI,   DuPont   and  the   Purchaser   agree   to   co-operate
generally and take all steps which may  reasonably be required
(including without limitation making appropriate  applications
to the  relevant  governmental  and/or local  authorities)  to
arrange  for  the  transfer  or  assignment  to  Newco  or the
re-issue in the name of Newco of each of the Permits  (insofar
as they  relate to the Newco  Business)  with  effect from the
Completion  Date in each case upon  terms  which  will  enable
Newco to continue to conduct  the Newco  Business  with effect
from the Completion Date  substantially in the manner in which
the Newco Business is conducted prior to the Completion  Date.
Any  direct  costs  arising  from the  obligations  under this
sub-Clause  12.7 will be divided  equally  among the  parties.
Furthermore,  each of the  parties  shall  use all  reasonable
efforts to effect each such  transfer,  assignment or re-issue
as promptly as practicable after the date of this agreement.

12.7.2  ICI and DuPont shall  together use  reasonable  endeavours  to
obtain such  consents  from third parties as may be reasonably
required to enable Newco to obtain the benefit of the software
licences  which are  necessary  for the operation of the Newco
Business as at the  Completion  Date at no additional  licence
fee.

12.7.3  If such  consents  are not  obtained,  ICI  and  DuPont  shall
procure such additional software licences as are necessary for
the  operation  by  Newco  of  the  Newco  Business  as at the
Completion  Date.  ICI and DuPont  shall each be liable for 50
per cent of the  costs  of such  additional  software  licence
fees.

12.8  Other than in respect of the members of the Selling Group's compliance
with the provisions of sub-Clause  12.7, the Purchaser  hereby accepts
and  agrees  that none of the  Selling  Group  shall be liable for any
failure or refusal by any relevant  governmental or local authority to
arrange or effect the transfer or  assignment to Newco or the re-issue
in the name of Newco of any of the Permits as aforesaid.

12.9  It is  agreed  between  DuPont  (for  itself  and  on  behalf  of  its
Affiliates) and the Purchaser (for itself and on behalf of Newco) that
the  indemnity  given by Newco in  favour of TEL in  respect  of Newco
Liabilities (as defined in the Hivedown  Agreement) pursuant to Clause
7.3 of the Hivedown  Agreement (the "NEWCO INDEMNITY") shall not apply
if and to the extent  that the  subject  matter of any claim under the
Newco  Indemnity  also  gives  rise to or  constitutes  a claim by the
Purchaser and/or relevant Purchaser Affiliate under or pursuant to the
Newco Share Sale Agreement.

12.10  For the purposes of sub-Clauses 12.7 and 12.8 the expression "PERMITS"
shall  include any  registrations  which may be required for Newco for
taxation purposes.

12.11  With effect from the Record Date, or earlier with the agreement of the
parties (such agreement not to be unreasonably withheld),  the parties
shall use such reasonable endeavours as they are each able to do so as
to procure that TEL and Newco meet their  obligations  under the first
sentence of paragraph 3 of Schedule 7 of the Hivedown Agreement (as if
the obligations  under the first sentence of paragraph 3 had come into
effect on the Record Date, or earlier as aforesaid) but subject to the
provisions  of paragraph  13 of Schedule 7 of the Hivedown  Agreement.
For the purpose of this sub-Clause 12.11,  references to "consents" in
such paragraph 3 shall be deemed to include the Consents.

12.12

12.12.1 If the  Purchaser  (which for the  purpose of this  sub-Clause
12.12  shall  not  include  its  successors  in  title) or any
relevant  Affiliate  ("PURCHASER  COMPANIES")  has  not  by  1
September 2003 renewed the planning  approval no.  W/66/338/84
in  relation  to NBQ  issued  on 27  September  1988 on appeal
against  the  decision of  Lincolnshire  County  Council  (the
"APPROVAL")  expiring  on 1  September  2003  relating  to the
disposal of digester  residue for a further  term of a minimum
of 8 years on terms  enabling the continued use of NBQ for its
current waste disposal  purposes,  then, subject to compliance
by  the  Purchaser  Companies  with  the  provisions  of  this
sub-Clause  12.12,  ICI  shall  on  written  notice  from  the
Purchaser  Companies given on or within ten working days after
1 September 2003 (a "COMPLETION NOTICE") purchase,  or procure
the purchase  of, NBQ, on the terms set out in Clause  12.12.4
from the Purchaser Companies.

12.12.2 ICI's  obligation in sub-Clause  12.12.1 is conditional on the
following  obligations  of the Purchaser  Companies,  from the
Completion Date:

(i) to use and manage  NBQ during the period of its  ownership
materially  in  accordance  with  Environmental  Law,  the
standards  of the  relevant  regulatory  authorities,  the
conditions   of  any  Permits  and  planning   permissions
relating thereto and good industry  practice,  in a manner
conducive to the renewal of the Approval;

(ii)to use NBQ  solely  for the  purpose  of the  disposal  of
digester residue arising from the sulphate TiO2 process at
the  Grimsby  Site (as such term is  defined  in the Newco
Share Sale Agreement); such residue disposed to be broadly
similar in quality,  quantity  and type to that  currently
disposed  at the  date of this  agreement  and  materially
consistent  with the  requirements of the Approval and any
Permits relating thereto;

(iii) to use all  reasonable  efforts to take,  or cause to be
taken,  all  actions  and to do, or cause to be done,  all
things  reasonably  necessary,   proper  or  advisable  in
relation to  obtaining  the renewal of the  Approval for a
term  of at  least  8  years,  including  acceding  to the
reasonable demands of the relevant regulatory  authorities
and in  particular  to  submit an  application  for such a
renewal on or before 31 December 2001.

12.12.3 The Purchaser Companies shall from the Completion Date:

(i) use all reasonable efforts to be a "fit and proper person"
within the  meaning of the  Environmental  Protection  Act
1990;

(ii)promptly  inform ICI of all material  matters  relating to
the  process for the  renewal of the  Approval,  including
providing  copies of  correspondence,  and  permitting ICI
reasonable  opportunity  to participate in the process (at
ICI's  expense)  and  including  providing  a copy  of the
application  for the renewal of the  Approval to ICI prior
to its  submission  to the  relevant  planning  authority.
Expense incurred by the Purchaser Companies in relation to
the  renewal  of  the  Approval  shall  be  borne  by  the
Purchaser Companies; and

(iii) not  create  or  permit  or  suffer  to be  created  any
encumbrances  over NBQ which shall  subsist at the date of
the transfer of NBQ to the Buyer.

12.12.4 The following conditions shall apply on any sale of NBQ by the
Purchaser Companies to the "BUYER" (ICI or a company nominated
by ICI);

(i) The price payable for NBQ shall be GBP1;

(ii)The Purchaser shall sell with Full Title Guarantee;

(iii)  Completion  shall take place ten working days after the
receipt  of a  Completion  Notice  before  2.00  pm at the
registered  office of ICI or at such other  date,  time or
place as may be agreed between ICI and the Purchaser;

(iv)The Purchaser  Companies shall prior to completion  deduce
to the Buyer the title to NBQ  insofar as it differs  from
the  title at the  date of this  agreement  and the  Buyer
shall not raise any  requisition  in respect of any matter
arising before the date of this agreement;

(v) NBQ will be sold subject to:

(a)  all  overriding  interests  as defined  in  the  Land
Registration  Act 1925 as amended;

(b)  all matters referred to in the registers of the title
under  which  NBQ  is to be  registered  (other  than
financial charges and encumbrances  created in breach
of sub-Clause 12.12.3 (iii));

(c)  all matters subject to which NBQ is to be sold to the
Purchaser  insofar as they remain  valid,  subsisting
and affect the title at the completion of the sale to
the Buyer;

as  well  as  those  encumbrances   referred  to  in  Standard
Condition 3.1.2.

12.12.5 NBQ  will  be  sold  with  vacant   possession  on  completion
of its sale.

12.12.6 The  transfer of NBQ will  contain  covenants  by the Buyer to
comply with the following obligations insofar as the Purchaser
Companies may remain liable  (directly or indirectly) for them
after the date of the transfer:

(i) obligations  arising  from  matters  referred  to in  the
registered title of NBQ;

(ii)obligations  arising under any  documents subject to which
NBQ is sold to the Purchaser;

and  to  indemnify   the  Purchaser   Companies   against  any
non-compliance.

12.12.7 The  transfer  of  NBQ  will  contain  an  undertaking  by the
Purchaser to indemnify  and keep  indemnified  on a continuing
basis the Buyer (for  itself and its  affiliates)  against any
Adverse  Consequences  (as defined in the Americas  Share Sale
Agreements)  ICI or the  Buyer  may  suffer as a result of the
failure  of the  Purchaser  Companies  to  comply  with  their
obligations under sub-Clauses  12.12.2 and 12.12.3  including,
without  limitation,  any  Environmental  Liabilities  arising
therefrom;

12.12.8 The agreement set out in this  sub-Clause  12.12  incorporates
the Standard  Conditions  of Sale (Third  Edition)  ("STANDARD
CONDITIONS").  In case of  conflict  between  this  sub-Clause
12.12  and the  Standard  Conditions,  this  sub-clause  12.12
prevails.  Terms used or defined  in the  Standard  Conditions
have the same meanings when used in this sub-clause 12.12.

12.12.9 On the transfer of NBQ to the Buyer:

(i) ICI shall  indemnify the Purchaser  Companies  against all
and  any  Loss   relating  to  NBQ  and  arising  from  or
associated with any Environmental  Liability arising on or
after 1 September 2003;

(ii)From the date on which NBQ is transferred to the Buyer and
until such time as the  transfer  of the Waste  Management
Licence is effected,  ICI shall comply with all conditions
of the Waste  Management  Licence and any  requirement  or
written or oral communication received from any regulatory
authority in relation to the same.

(iii) Both ICI and the  Purchaser  Companies  shall  use their
reasonable  efforts to procure  the  transfer of the Waste
Management  Licence to ICI as soon as  possible  following
the transfer of NBQ to the Buyer.

(iv)For the purposes of this  sub-Clause 12.12  the  following
definitions apply:

"ENVIRONMENT"  means the natural and man-made  environment
and  all  or  any  of  the  following   media  namely  air
(including  air  within  buildings  and air  within  other
natural or  man-made  structures  above or below  ground),
water  (including  water under or within land or in drains
or  sewers  and  inland  waters)  and land and any  living
organisms (including humans) or systems supported by those
media;

"ENVIRONMENTAL  LAW" means all present and future rules of
common  law,  acts,   regulations,   standards  or  codes,
applicable rights or obligations under European  Community
Law, any notices, directions,  impositions or requirements
issued,  imposed, or directed by any regulatory  authority
relating  to the  Environment,  the  protection  of  human
health and  safety or the  Environment  including  without
limitation  all  laws  relating  to  emissions,  seepages,
discharges,   escapes,   releases,   leaks  or  threatened
escapes,  releases, and leaks of pollutants,  contaminants
or  hazardous   substances   relating  to  the   creation,
handling,   storage  or  disposal  of  same  and  for  the
avoidance  of  doubt,  includes  any law  introducing  any
materially  more  onerous or stringent  requirements  than
were  applicable  at the  date  hereto  including  but not
limited to Part IIA of the  Environmental  Protection  Act
1990  (and  the  relevant  draft  guidance  as at the date
hereto) and sections  161A to 161D of the Water  Resources
Act 1991 whether or not in force at the date hereto;

"ENVIRONMENTAL   LIABILITY"   means   the   clean-up   and
restoration of NBQ,  compliance with the Waste  Management
Licence or the  surrender,  revocation  or transfer of the
same,   compliance  with  any   requirement,   request  or
communication  from a regulatory  authority in relation to
Environmental   Laws,   any   monitoring,   investigation,
remediating, removing, abating, cleaning-up, containing or
otherwise  taking  corrective  action  and  shall  include
post-remedial  monitoring  or  responding  to requests for
information in relation to NBQ, and shall also include any
actual or potential  claim by a third party in relation to
site  clean-up  or  restoration  of the land or any of the
aforementioned matters;

"LOSS" means any losses, claims, penalties,  fines, costs,
expenses, liabilities, obligations, judgements, damages or
settlement   payments   which  are  suffered  or  incurred
directly or indirectly by the  Purchaser  Companies  after
sale of NBQ to the Buyer in relation to any  Environmental
Liability;

"WASTE  MANAGEMENT  LICENCE"  means the  waste  management
licence  (number L142) issued to Tioxide  Europe  Limited,
Grimsby,  South  Humberside  DN31 2SW or any similar waste
management licence relating to NBQ in force at 1 September
2003.

13  INTEREST

If any sum due for payment under or in accordance  with this agreement
is not paid on the due date the party in  default  shall  pay  Default
Interest  on that  sum  from the due  date  until  the date of  actual
payment calculated on a day to day basis.

14  ANNOUNCEMENTS

No party  shall make or permit  any  member of the ICI  Group,  DuPont
Group  or the  Purchaser  Group,  as the  case  may be,  to  make  any
announcement  concerning this agreement or any ancillary matter except
as required by law or any competent  regulatory body or with the prior
written  approval of the other parties which shall not be unreasonably
withheld or delayed.

15  CONFIDENTIALITY

15.1  For the purposes of this Clause:

15.1.1  "CONFIDENTIAL INFORMATION" means:

(i) all  information  received by the Purchaser Group from the
ICI  Group   relating  to  ICI,  its  Affiliates  and  the
businesses  conducted by the ICI Group and all information
received  by  the  Purchaser  Group  from  DuPont  or  its
Affiliates relating to DuPont or its Affiliates,  (in both
cases  whether  pursuant  to,  or  in  relation  to,  this
agreement or any of the Newco Implementation Agreements or
the Americas Implementation Agreements); and

(ii)all  information  received by the ICI Group and the DuPont
Group from the Purchaser  Group relating to the Purchaser,
its  Affiliates  and  the  businesses   conducted  by  the
Purchaser  Group (whether  pursuant to, or in relation to,
this   agreement  or  any  of  the  Newco   Implementation
Agreements or the Americas Implementation Agreements);

including,  in all cases, not only written information but
information transferred orally, visually,  electronically,
or by any other means. The term "Confidential Information"
shall not include:

(a)  information that is in the public domain at the  date
of  this agreement;

(b)  information that  subsequently  comes into the public
domain,  otherwise  than as a result  of a breach  of
this  agreement,  but only after it has come into the
public domain;

(c)  information   which  the   receiving   party  or  its
Representatives  obtain  from a third party not under
any  confidentiality  obligation  to  the  disclosing
party respecting such information;

(d)  information   which  the   receiving   party  or  its
Representatives at the time of disclosure already has
in its  possession  and which is not  subject  to any
obligation of secrecy on their part to the disclosing
party;

(e)  information  which  is  independently   developed  by
employees   of   the    receiving    party   or   its
Representatives  who had no access to the information
disclosed by the disclosing party; or

(f)  information   which   relates   exclusively   to  the
Businesses   after   completion  of  the  Newco  Sale
Agreements  and Americas  Sale  Agreements  which the
Purchaser or its Affiliates disclose publicly.

15.1.2  "REPRESENTATIVES"  means  Affiliates,   directors,   officers,
employees,  agents  or  representatives  of any  party  or its
Affiliates,  and  their  respective  solicitors,  accountants,
consultants and financial advisers.

15.2  Each  party  undertakes  for a period of 5 years from the date of this
agreement   (subject  to  such  other  period  specified  in  a  Newco
Implementation  Agreement or an Americas  Implementation  Agreement in
relation to particular  information)  following the Completion Date to
maintain  Confidential  Information  received by it, its Affiliates or
its  Representatives  relating to any other party or any other party's
Affiliates   in  confidence   and  not  disclose   that   Confidential
Information  to any person other than its  Representatives,  except as
required  by law or any  competent  regulatory  authority  or with the
prior  written  approval  of such  other  party,  which  shall  not be
unreasonably withheld or delayed.

15.3  Each party  undertakes  only to disclose to its  Representatives  such
Confidential  Information  relating to the disclosing party or parties
or the  disclosing  party's or parties'  Affiliates  as is  reasonably
required for the purposes of  performing  the  obligations  under this
agreement  or the  Newco  Implementation  Agreements  or the  Americas
Implementation  Agreements and only to those  Representatives  whom it
has  informed  of  the   confidential   nature  of  the   Confidential
Information  and who  undertake  to keep it  confidential.  Each party
shall be responsible for breach of such confidentiality undertaking by
it or  its  Representatives  and  undertakes  to  indemnify  and  hold
harmless  the  disclosing  party or  parties,  its  Affiliates  or any
successor to such business  against all actions,  proceedings,  costs,
claims,  demands,  liabilities,  losses or expenses  (including  legal
expenses) arising from such breach.

15.4  In the event that,  after  receipt of  Confidential  Information,  any
party,  or any  person or  Representative  to whom it has  transmitted
Confidential Information, becomes legally required (by oral questions,
interrogatories,  requests for  information  or  documents,  subpoena,
civil  investigation,  demand or similar  process,  or  otherwise)  to
disclose any of the  Confidential  Information  received,  the legally
compelled party shall provide the disclosing party with prompt written
notice of that  requirement  so that the  disclosing  party may seek a
protective order or other appropriate  remedy but shall not be obliged
to delay  disclosure if to do so would be in breach of any  conditions
for such disclosure imposed by the authority compelling disclosure and
in any event should the disclosing  party not be successful in seeking
or  obtaining a  protective  order or other  appropriate  remedy,  the
disclosing  party shall waive  compliance  with the provisions of this
agreement  for such  particular  case to enable the legally  compelled
party or its Representative to comply with any such legal requirement.

15.5  Each party will only use (or permit the use by its Representatives of)
the Confidential Information received by it or its Representatives for
the purposes of the transactions contemplated by this agreement.

15.6  Nothing in this Clause 15 shall make a party liable to any other party
for any of its  Representatives in relation to breaches of this Clause
which  occur  after  the time  when such  Representative  becomes  the
Representative  of another  party to this  agreement.  Nothing in this
sub-Clause  15.6  shall  affect  any  duty  owed  personally  by  such
Representative.

15.7  Nothing in this Clause 15 shall  supersede or vary the  obligations of
the parties  set out in any of the Newco  Technology  Agreements,  the
Americas   Technology   Agreements   or  any  other   agreement,   the
confidentiality  provisions  of  which  exist  on  the  date  of  this
agreement.

15.8  Notwithstanding any provision to the contrary,  the provisions of this
Clause shall survive termination of this agreement.

16  GUARANTEES AND INDEMNITY

16.1  Each party  undertakes to procure  that,  subject to the terms of this
agreement,  its  relevant  Affiliates  enter into the  relevant  Newco
Implementation Agreements or Americas Implementation Agreements on the
Completion Date, as the case may be.

16.2  The  parties  shall  on the  Completion  Date  enter  into  a deed  of
guarantee  in the Agreed Form in relation  to the  obligations  of the
parties and their Affiliates after the Completion Date under the Newco
Sale   Agreements  and  Americas  Sale  Agreements  and  the  relevant
Implementation Agreements.

16.3  At or as soon as reasonably practicable after the Completion Date, the
Purchaser  will use its reasonable  endeavours to procure,  whether by
offering its own covenant in substitution  for that of a member of the
Selling  Group  or  otherwise  howsoever  (but in no event  shall  the
Purchaser or any of its  Affiliates be required to make any payment as
a basis for such release),  the release of ICI and/or DuPont or any of
their respective  Affiliates (the "Selling Group") from the guarantees
specifically  identified in the Final Disclosure  Letter applicable to
the Newco Share Sale  Agreement for the purposes of this provision and
pending such release the Purchaser will indemnify and keep indemnified
each  of the  members  of the  Selling  Group  from  and  against  any
liability (including any claim, demand, proceeding, costs, damages and
expenses)  which they may suffer or incur under or in relation to such
guarantees.

16.4  The Purchaser  will indemnify and keep  indemnified  the Selling Group
from  and  against  any  liability   (including  any  claim,   demand,
proceeding,  costs,  damages and expenses)  which they may suffer as a
result of the failure of the Purchaser to comply with its  obligations
under paragraph 2 of Schedule 4.

17  FURTHER ASSURANCE

The parties shall, and shall procure that their  Affiliates  shall, at
their  own  expense,  comply  with  the  terms of this  Clause  17 and
Schedule 4 and, at all times from the date of this  agreement,  do all
things as may be reasonably  required to give effect to this agreement
and to all other agreements  contemplated hereby,  including,  without
limitation,  the execution of all deeds and  documents,  procuring the
convening of all meetings,  the giving of all necessary waivers (other
than in respect of Conditions  Precedent) and consents and the passing
of all  resolutions  and  otherwise  exercising  all powers and rights
available to them.

18  NOTICES

18.1  Any notice or other document to be served under this  agreement  shall
be in writing  and may be  delivered  by hand or by courier or sent by
fax or by post to the party to be served at its address  appearing  in
this  agreement (and marked for the attention of the person whose name
is referred to in sub-Clause  18.3 below) or at such other address (or
marked for the attention of such other person) as it may have notified
to the other  parties in  accordance  with this Clause.  Any notice or
other document sent by post shall be sent by registered  post (if both
posted and for delivery within the same jurisdiction) or by registered
airmail (if posted for delivery  outside the  jurisdiction in which it
is posted), return receipt requested (or any substantially  equivalent
service).

18.2  Any notice or document delivered or sent in accordance with sub-Clause
18.1 shall be deemed to have been served:

18.2.1  if  delivered by hand or by courier, at the time of  delivery;
or

18.2.2  if  sent  by  fax,  at  the  time  of delivery if sent between
12.01 a.m. and 6.00 p.m.  (local time at the  destination)  or
10.00 a.m. (local time at the destination) on the Business Day
after its transmission (if sent at any other time); or

18.2.3  if posted,  at 10.00 a.m. on the second  Business Day after it
was put into the post if posted for  delivery  within the same
jurisdiction, or at 10.00 a.m. (local time at the destination)
on the fifth Business Day after it was put in the post if sent
by registered airmail.

18.3  The person to whom  notices or documents  should be addressed  for the
purposes of sub-Clause 18.1 is:

18.3.1  if to be served on ICI:

the Company Secretary
Imperial Chemical House
9 Millbank
London SW1P 3JF
Fax: (44) 171 798 5170

18.3.2  if to be served on DuPont:

Vice President & General Manager
White Pigment & Mineral Products
E.I. du Pont de Nemours and Company
Building 36-2nd Floor
Barley Mill Plaza
Wilmington, Delaware U.S.A. 19880
Fax: (1) 302 992 6084

18.3.3  if to be served on the Purchaser:

General Counsel
NL Industries, Inc
16825 Northchase Drive
Suite 1200
Houston, Texas 77060, USA
Fax: (1) 281 423 3333

18.4  In proving  service of a notice or document it shall be  sufficient to
prove  that  delivery  was  made by hand,  courier  or fax or that the
envelope  containing the notice or document was properly addressed and
posted  (either by registered  post or by registered  airmail,  as the
case may be, in accordance with the requirements of this Clause).

19  COSTS

Save  as  otherwise  provided  in  this  agreement,  or  as  otherwise
specifically  agreed to in  writing by the  parties  after the date of
this agreement,  each party shall pay the costs and expenses  incurred
by it and its  Affiliates  in  connection  with the entering  into and
completion of this agreement  including without  limitation in respect
of their obligations fulfilling the Conditions Precedent.

20  ASSIGNMENT

None of the rights or obligations under this agreement may be assigned
or transferred  without the prior written consent of the other parties
(the  "NON-ASSIGNING  PARTIES") other than an assignment of the rights
(but not the  obligations)  to an  Affiliate  of the  assigning  party
provided that:

20.1  such  assignment  shall only be  permitted  if the  assignment  has no
adverse effect on the Non-assigning Parties;

20.2  if the Affiliate to which the rights have been  assigned  ceases to be
an  Affiliate  of the  assigning  party,  the  rights  which have been
transferred  shall be  re-transferred  to the party  which  originally
assigned  those  rights  or to  another  Affiliate  of  that  original
assigning party; and

20.3  it shall be a condition of any such assignment that reasonable  notice
is given in writing to the  Non-assigning  Parties of the  proposal to
assign  (identifying the rights proposed to be assigned,  the identity
of the proposed  assignee and such other details  relating  thereto as
the Non-assigning Parties may reasonably require).

21  RTPA

Each of the parties to this  agreement  confirms on its own behalf and
on  behalf  of each of its  Affiliates  that  is  party  to any of the
Implementation  Agreements  (as  executed)  that if by  virtue  of any
provision  of  this  agreement  or  any of  the  Newco  Implementation
Agreements or the Americas Implementation  Agreements (as executed) or
any other  agreement or  arrangement of which this agreement or any of
the  Implementation  Agreements  forms  part,  any such  agreement  or
arrangement is subject to  registration  under the  Restrictive  Trade
Practices Act 1976 (the "RTPA")  (provided  that any such agreement or
arrangement is not a non-notifiable  arrangement  under Section 27A of
the RTPA) none of the parties to any such agreement or arrangement who
carries on business within the United Kingdom shall give effect to, or
enforce or purport to enforce the agreement or  arrangement in respect
of any such provision until the day after particulars of the agreement
or  arrangement  (as the  case  may be)  have  been  furnished  to the
Director General of Fair Trading under section 24 of the RTPA.

22  CONFLICT WITH OTHER AGREEMENTS

In the event of any  conflict  between this  agreement  and any of the
Implementation  Agreements,  this agreement  shall prevail (as between
the parties to this  agreement and as between any other members of the
ICI Group,  the DuPont Group and the Purchaser  Group) save where such
other  agreement  expressly  states  that  it (or  any  part of it) is
overriding  this  agreement  in any  respect  and the  parties to this
agreement are either also parties to that other agreement or otherwise
expressly  and in  writing  agree  that  such  other  agreement  shall
override this agreement in that respect.

23  WHOLE AGREEMENT

23.1  This  agreement,  the Newco  Implementation  Agreements,  the Americas
Implementation  Agreements and any other  agreements  contemplated  in
this agreement or in those  agreements (if and when executed)  contain
the  whole  agreement   between  the  parties  and  their   respective
Affiliates relating to the transactions contemplated by this agreement
and   the   Newco   Implementation   Agreements   and   the   Americas
Implementation   Agreements  and  supersede  all  previous  agreements
between the parties and their respective  Affiliates  relating to such
transactions.

23.2  Each of the parties to this agreement  acknowledges  on its own behalf
and on behalf of each of its  Affiliates  that,  in  agreeing to enter
into this  agreement and the Newco  Implementation  Agreements and the
Americas  Implementation   Agreements,   it  has  not  relied  on  any
representation,  warranty,  collateral  contract  or  other  assurance
(except  those  set  out  in  this  agreement  or  any  Implementation
Agreement)  and waives all rights  and  remedies  which,  but for this
sub-Clause,  might otherwise be available to it in respect of any such
representation,  warranty,  collateral  contract  or other  assurance,
provided  that  nothing in this  Clause  shall  limit or  exclude  any
liability for fraud.

23.3  Each  obligation,  representation  and  warranty  on the  part of ICI,
DuPont or the Purchaser under this agreement (excluding any obligation
fully performed on the Completion  Date) shall continue in force after
the Completion Date.

23.4  Nothing in this agreement or the  Implementation  Agreements  shall be
deemed to constitute a  partnership  between the parties  hereto.  All
obligations of the parties shall be several.

24  AMENDMENTS

No amendment,  variation or waiver of this  agreement or any provision
of  this  agreement  shall  be  effective  unless  it  is  in  writing
specifically  referring to this  agreement  and duly executed by or on
behalf of all the parties.

25  GOVERNING LAW

This  agreement is governed by and shall be  construed  in  accordance
with English law.

26  JURISDICTION

26.1  The  parties  agree to submit  to the  exclusive  jurisdiction  of the
English courts for all purposes relating to this agreement and to take
no  action  to avoid,  dispute  or  suggest  to such  court  that such
jurisdiction is improper.

26.2  DuPont  irrevocably  appoints Du Pont (U.K.)  Limited of Wedgwood Way,
Stevenage,  Hertfordshire  SG1 4QN as its  agent  for the  service  of
process in England.

26.3  The Purchaser irrevocably appoints Herbert Smith (Ref 554) of Exchange
House,  Primrose Street,  London, EC2A 2HS as its agent for service of
process in England.

AS WITNESS  the hands of the duly  authorised  representatives  of the
parties on the date which appears first on page 1.

SCHEDULE 1
CONDITIONS PRECEDENT
(CLAUSE 2)

1  In so far as it has jurisdiction over the Proposed  Transactions,  the
Office of Fair Trading indicating in terms reasonably  satisfactory to
the parties that it is not the  intention of the Secretary of State to
refer  the  Proposed   Transactions  to  the  Monopolies  and  Mergers
Commission (the "OFT CONDITION").

2  In so far as it has jurisdiction over the Proposed  Transactions,  the
Bundeskartellamt   approving  the  Proposed   Transactions   in  terms
reasonably satisfactory to the parties (the "BK CONDITION")

3  In so far as it has jurisdiction over the Proposed  Transactions,  the
European Commission issuing a decision, pursuant to Article 6(1)(b) of
Regulation   4064/89   (or   amending    Regulation    1310/97)   (the
"REGULATIONS")  declaring  in  terms  reasonably  satisfactory  to the
parties that any concentration  arising from the Proposed Transactions
is compatible with the common market (the "EC CONDITION").

4  In so far as it has jurisdiction over the Proposed  Transactions,  the
European Commission not issuing a decision pursuant to Article 9(3) of
the Regulations,  to refer the Proposed  Transactions to the competent
authorities of any Member State of the European Union.

5  No  Member State  of the European  Union taking  measures  pursuant to
Article 21 of the Regulations, to protect legitimate interests.

6  All  waiting  periods  and any  extensions  thereof  under the HSR Act
applicable to the  consummation  of the Proposed  Transactions  having
been satisfied, expired or terminated (the "HSR CONDITION").

7  The  Director  appointed  under  the  Canadian  Competition  Act  (the
"COMPETITION  ACT")  issuing an advance  ruling  certificate  in terms
reasonably  satisfactory  to  the  parties  under  Section  102 of the
Competition  Act in respect of the sale of TCI by Affiliates of ICI to
the Purchaser or the  applicable  waiting  period under Section 123 of
the Competition Act having expired and the Director having advised the
Purchaser in terms reasonably satisfactory to the parties that he does
not intend to apply to the  Competition  Tribunal  for an order  under
Section 92 or  Section  100 of the  Competition  Act in respect of the
proposed acquisition of TCI (the "COMPETITION ACT CONDITION").

8  All other consents and approvals,  as are required by law, having been
obtained,  or all waiting  periods (in addition to the HSR  Condition,
the  OFT  Condition,  the EC  Condition,  the  BK  Condition  and  the
Competition Act Condition) (and any extensions thereof) having expired
or  terminated  in any  relevant  jurisdiction  for  the  purposes  of
implementing the Proposed  Transactions in a form  satisfactory to all
parties  (but only  where  such  parties  are  directly  concerned  or
interested).

9  No order, writ,  injunction or decree has been issued which restrains,
enjoins or invalidates, or otherwise materially adversely affects, the
Proposed  Transactions  and no  action,  suit or other  proceeding  is
pending or threatened that has a reasonable likelihood of resulting in
any such order, writ, injunction or decree being issued.

10  The   obligations  of  ICI  and  DuPont  to  consummate  the  Proposed
Transactions contemplated by this agreement are subject, at the option
of ICI and DuPont, to the satisfaction of the conditions that:

10.1  all  obligations  and  undertakings  of the  Purchaser  (the breach of
which, singly or in the aggregate,  would be material) to be performed
by the Purchaser  under this  agreement  prior to or at the Completion
Date shall have been performed; and

10.2  all  warranties  and  representations  made by the  Purchaser  in this
agreement (the breach of which,  singly or in the aggregate,  would be
material) shall be true and correct in all material respects.

11  The   obligations   of  the  Purchaser  to  consummate   the  Proposed
Transactions contemplated by this agreement are subject, at the option
of the Purchaser, to the satisfaction of the conditions that:

11.1  all obligations and  undertakings of ICI (the breach of which,  singly
or in the  aggregate,  would be material) to be performed by ICI under
this  agreement  prior to or at the  Completion  Date  shall have been
performed;

11.2  all warranties and representations  made by ICI in this agreement (the
breach of which, singly or in the aggregate,  would be material) shall
be true and correct in all material respects; and

11.3  all  warranties and  representations  made by DuPont in this agreement
(the breach of which,  singly or in the aggregate,  would be material)
shall be true and correct in all material respects.

12  The  completion of the TEL Sale,  for which purpose the  definition of
TEL Sale shall be deemed to include the execution of the Deed relating
to the Tioxide Pension Fund in the Agreed Form.

13  All Permits  which are  material in relation to the  operation  of the
Newco Business  having been  transferred or assigned to or reissued in
the name of  Newco  or  arrangements  reasonably  satisfactory  to the
Purchaser  having  been  made for any of the same  that  cannot  be so
transferred or assigned or reissued prior to the Completion Date to be
so transferred or assigned or reissued after the Completion Date.

SCHEDULE 2
PART I
NEWCO IMPLEMENTATION AGREEMENTS
(CLAUSE 1.1)

1  Hivedown Agreement

2  Newco Share Sale Agreement

3  Product Exchange Agreement between TEL and Newco

4  Technology Agreements

4.1  Name Agreement between Newco, TEL and DuPont

4.2  Name Agreement between Newco, TEL and DuPont

4.3  Newco Patent and Know-How Licence

4.4  Technical  Assistance  Agreement  between TEL (or an Affiliate of TEL)
and Newco

4.5  Service  Agreement  for  transitional  IT services  between TEL (or an
Affiliate of TEL) and Newco

4.6  Service  Agreement (Eutech)  between ICI  (or an Affiliate of ICI) and
Newco

5  Deed of Guarantee  (to include a guarantee  given by the  Purchaser in
respect of Newco's obligations under the Hivedown Agreement)

6  Transfers,  in a form reasonably satisfactory to the Purchaser, of the
legal  interest in respect of the NBQ and  Killingholme  properties in
favour of the Purchaser or any of its Affiliates

7 Product  Supply  Agreement  (Newco to DuPont or an Affiliate of DuPont)
for:

7.1  Zirconia Frit;

7.2  Titanyl Sulphate;

7.3  Zirconium Orthosulphate Solution

7.4  Trivalent Titanium

8  Product Supply  Agreement  (DuPont or an Affiliate of DuPont to Newco)
for Titanium Tetrachloride

9  Product Supply Agreement (ICI or an Affiliate of ICI to Newco) for:

9.1  Sulphuric Acid

9.2  Sulphur

9.3  Caustic Soda

SCHEDULE 2
PART II
AMERICAS IMPLEMENTATION AGREEMENTS
(CLAUSE 1.1)

1  Americas Share Sale Agreements

2  Canadian and US Deeds of Indemnity

3  Americas Technology Agreements

3.1  Assignment and  Substitution  Agreement between Tioxide Group Limited,
Tioxide Group Services Limited, DuPont and TCI

3.2  Name Agreement between TEL, TAI and DuPont

3.3  Name Agreement between TEL, TCI and DuPont

3.4  Patent and Know-How Licence between TCI and DuPont

3.5  Venturis Agreement between DuPont and LPC

4  Deeds of Guarantee

5  LPC Termination  Agreement  between Kronos,  Inc.,  Kronos  Louisiana,
Inc., Kronos  International,  Inc.,  Kronos Europe  S.A./N.V.,  Kronos
Canada Inc., Kronos Titan GmbH, LPC, Tioxide Group Limited and Tioxide
Group Services Limited

6  LPC Licence  Agreement between Kronos,  Inc., Kronos Louisiana,  Inc.,
Kronos  International,  Inc., Kronos Europe  S.A./N.V.,  Kronos Canada
Inc., Kronos Titan GmbH, LPC and Tioxide Europe Limited

SCHEDULE 3
(CLAUSE 3.3)

1  Consideration and Adjustment

(1)  In this Schedule 3:

"A FORM"  means,  in  relation to each of TAI and TCI,  the  quarterly
financial  reports  in the  format  set  forth  in  Annex 3 which  are
prepared in accordance  with the  accounting  policies,  practices and
other  requirements  set  out or  referred  to in  ICI's  Controller's
Manuals as applied by the  relevant  Company  (with the  exception  of
pensions  liabilities  which are accounted for in accordance  with FAS
87) and prepared at the  Completion  Date on a basis  consistent  with
that  adopted by TAI and TCI in the A Form at 31  December  1997 (with
the  exception  that  pensions   liabilities   shall  be  reported  in
Provisions);  and if the Completion Date does not fall on the due date
for the  preparation of an A Form, a financial  report prepared on the
same basis for the financial period from the latest date at which an A
Form was prepared to the Completion  Date; and in relation to Newco, a
financial  report in the format set forth in Annex 3 and in accordance
with the accounting policies, practices and other requirements set out
or referred to in ICI's  Controller's  Manuals and  prepared as at the
Completion Date on a basis consistent with that adopted by TEL for the
preparation  of A  Forms  prior  to the  completion  of  the  Hivedown
Agreement;

"ACTUAL NET DEBT" means Net Debt as agreed or determined in accordance
with paragraphs (6) to (8) below;

"ACTUAL  NET  WORKING  CAPITAL"  means Net  Working  Capital as at the
Completion Date as determined under paragraphs (6) to (8) below;

"ESTIMATED  CONSIDERATION"  has  the   meaning   given   in  paragraph
(3)(a)  below  as applicable;

"ESTIMATED  COMPLETION  STATEMENT"  has the meaning given in paragraph
(3) below;

"ESTIMATED NET DEBT" has  the meaning given in paragraph (3)(b) below;

"ENTERPRISE  VALUE"  means,  for each Company or  Business,  the value
shown  against the line  described  as  Enterprise  Value shown in the
column  headed EV in Section 2 of this Schedule 3 against the relevant
Company or Business  which is the amount which the parties have agreed
to represent  the fair market value  (excluding in relation to TAI any
item  relating to the LPC  Interests) of that Company or Business on a
basis free of Net Debt;

"FINAL CONSIDERATION" has the meaning given in paragraph (5)(a) below;

"FINAL  COMPLETION  STATEMENT"  has  the  meaning  given  in paragraph
(5)(b) below;

"FINAL STOCKS" means the value of Stocks for the relevant Company at
Completion;

"INITIAL STOCKS"  means the value of Stocks for the  relevant  Company
or Business as at 28 February 1998;

"INTEREST RATE" means LIBOR plus 25 basis points;

"NET DEBT"  means,  in relation to a Company,  the amount  reported as
"net debt" on line 70090 of the A Form for that  Company as  described
in ICI's  Controller's  Manuals which, for the avoidance of doubt, can
be either a negative or a non-negative number;

"NET WORKING CAPITAL" means the aggregate of:

(c)     Operating Debtors; plus

(d)     Stocks (for the purposes of this  definition  meaning  Initial
Stocks  when used for Net  Working  Capital as at 28  February
1998 and meaning Final Stocks when used for Actual Net Working
Capital); less

(e)     Operating Creditors less than one year.

For the purposes of (b) the Stocks shall be valued in accordance  with
the document  headed  "Stocktaking  and Valuation  Principles"  in the
Agreed Form marked "NWC-S";

"NET WORKING  CAPITAL AS AT 28 FEBRUARY  1998" or "NWC 28" means,  for
each Company or Business,  the value shown in the column headed NWC in
Section 2 of this Schedule 3 against the relevant  Company or Business
which is the amount  which the parties  have agreed to  represent  the
value of Net Working Capital at 28 February 1998;

"OPERATING  CREDITORS  LESS  THAN 1  YEAR"  means,  in  relation  to a
Company,  the  absolute  value of the amount  reported as creditors of
that Company  which are external to that  Company  (including  without
limitation  creditors  which are members of, or other  business  units
within,  the ICI  Group  as at the  date of the  relevant  A Form)  as
defined by reference to  "Operating  Creditors  less than one year" on
line  70020 of the A Form  for  that  Company  as  described  in ICI's
Controller's Manuals;

"OPERATING  DEBTORS" means, in relation to a Company,  debtors of that
Company  which  are  external  to  that  Company   (including  without
limitation  debtors  which are  members  of, or other  business  units
within,  the ICI  Group  as at the  date of the  relevant  A Form)  as
defined by  reference  to  "operating  debtors" on line 70010 of the A
Form for that Company as described in ICI's Controller's Manuals;

"SHARE  SALE  AGREEMENTS"  means the  Americas  Share Sale  Agreements
and/or the Newco Share Sale Agreement (as the context so requires);

"STOCKS"  means,  in relation to a Company or  Business,  the stock of
fuels, raw materials,  ingredients,  packaging,  office and laboratory
supplies,  revenue  engineering  spares,  consumable  stores,  work in
progress  and  finished  goods  owned by that  Company or  Business as
determined  on line  70000 of the A Form for the  relevant  Company or
Business as described in ICI's Controller's Manuals;

(2)     (a)All  payments and values under this Schedule shall be in US
Dollars  and where an amount is not  itself  calculated  in US
Dollars  it  shall be  converted  into US  Dollars  at the mid
market  closing  exchange  rate in London for the  currency in
which that amount is  expressed  in US Dollars as published in
the London  Edition of the  Financial  Times  first  published
thereafter or, where the exchange rate is not published in the
London  Edition of the Financial  Times,  at the exchange rate
quoted by Citibank  N.A. as at the close of business in London
for the  currency  in which that  amount is  expressed  on the
Completion Date in relation to amounts in the Final Completion
Statement  (and  in  relation  to  amounts  in  the  Estimated
Completion  Statement  shall be the rate of exchange as at the
date which is nine days before the Completion Date).

(b)     References  to  the  absolute  value  of  a  number X shall be
construed as follows:

(i) if X is greater than or equal to zero,  the absolute value
of X shall be equal to X; and

(ii)if X is less than zero,  the absolute  value of X shall be
X multiplied by -1,

so that, for the purposes of illustration,  the absolute value
of 1 is equal to 1 and the absolute value of -1 is equal to 1.

ESTIMATED CONSIDERATION PAYABLE AT COMPLETION

(3)  In  relation  to each Share Sale  Agreement  or, as  appropriate,  the
Hivedown  Agreement,  no later than seven days  before the  Completion
Date ICI (in  relation to TAI and TCI) and TEL (in  relation to Newco)
shall deliver to the Purchaser a statement (the "ESTIMATED  COMPLETION
STATEMENT")  calculating the Estimated  Consideration for the relevant
Company on the following basis:

(a)     Estimated  Consideration for the relevant Company shall be the
amount determined by the following formula:

Estimated  Consideration  = EV minus END plus in the case only
of Newco US$1 (excluding in the case of TAI in relation to any
of the  foregoing any item or matter  attributable  to the LPC
Interests) plus in the case only of TAI LV

Where (in relation to the relevant Company):

EV = Enterprise Value

END = Estimated Net Debt

LV = X (value of LPC Interests)

(b)     Estimated  Net Debt shall be the amount which ICI (in relation
to TAI and TCI) and TEL (in relation to Newco),  estimates (in
good faith based on the  accounting  records and  forecasts of
the  relevant  Company  (or as the case may be TEL) and  after
consultation  with the  Purchaser  and (in  relation to Newco)
DuPont)  to be the Net Debt for the  relevant  Company  at the
Completion Date.

(c)     In relation to the LPC Interests,  the consideration  shall be
US$X, which shall not be subject to adjustment.

The figure  represented  by X in this paragraph (3) shall be as agreed
between ICI and the Purchaser.

(4)  On the Completion  Date the relevant  Purchaser  Affiliate will pay or
procure  the  payment of (in  accordance  with the  provisions  of the
relevant  Share  Sale  Agreement  or  as  appropriate,   the  Hivedown
Agreement) an amount equal to the Estimated Consideration. In relation
to the LPC Termination  Agreement,  the relevant  Purchaser  Affiliate
shall pay or procure the payment of (in accordance  with the provision
of the LPC Termination Agreement) an amount equal to the consideration
due under such agreement being US$Y.

The figure  represented  by Y in this paragraph (4) shall be as agreed
between ICI and the Purchaser.

CALCULATION OF THE FINAL  CONSIDERATION IN RELATION TO TAI AND TCI

(5)  In relation to the Americas Share Sale Agreements:

(a)     the  Final  Consideration  for  the  relevant Company shall be
determined by the following formula:

Final  Consideration  = EV minus  AND  minus  NWC 28 plus ANWC
(excluding  in  the  case  of TAI  in  relation  to any of the
foregoing  any  item  or  matter   attributable   to  the  LPC
Interests) plus in the case only of TAI LV

Where (in relation to the relevant Company):

EV = Enterprise Value

AND = Actual Net Debt

NWC28 = Net Working Capital as at 28 February 1998

ANWC = Actual Net Working Capital

LV = X (value of LPC Interests)

The figure  represented by X in this paragraph (5) shall be as
agreed between ICI and the Purchaser.

(b)     After  the  Completion  Date ICI  shall  prepare  a completion
statement  as at the  Completion  Date which  shall  contain a
statement  of  the  Final  Consideration  in  accordance  with
paragraph 5(a) above based on ICI's  calculations  (the "FINAL
COMPLETION  STATEMENT").  The Final Completion Statement shall
be  prepared  using  ICI's  normal  accounting   policies  and
practices  as set out or  referred  to in  ICI's  Controller's
Manuals  as applied by the  relevant  Company on a  consistent
basis  and shall be  submitted  by ICI to ICI's  Auditors  for
review.

No final  consideration  adjustment  will be made for the Newco Shares
under  the  Newco  Share  Sale  Agreement  and the  provisions  of the
Hivedown Agreement will apply. The provisions of sub-paragraphs 1(5) -
(9) inclusive will not apply to the Newco Share Sale Agreement.

(6)  Within  45 days of the  Completion  Date,  ICI  shall  issue the Final
Completion Statement (distinguishing between the Americas Business and
the LPC Business) for the relevant Companies to the Purchaser together
with a copy  of a  report  by  ICI's  Auditors  addressed  to ICI  and
substantially  in the form set out in Annex 2 to the  effect  that the
Final  Completion  Statement has been prepared in accordance with this
agreement.  Although it is ICI's  responsibility  to prepare the Final
Completion Statement, ICI will require the assistance of the employees
of the relevant Purchaser Affiliates to fulfil this responsibility and
the Purchaser shall ensure such assistance is provided promptly and at
no  charge.   Immediately  after  delivery  of  the  Final  Completion
Statement,  the Purchaser's  Auditors shall have the right, subject to
the Purchaser delivering to ICI's Auditors a signed letter in the form
set out in Annex 4, to review the Final Completion Statement and ICI's
Auditors  working papers relating to the Final  Completion  Statement.
Within 45 days of delivery to the  Purchaser  of the Final  Completion
Statement  and  ICI's  Auditors  report  (each  of  which  shall be in
English) to the Purchaser's  designated location,  the Purchaser shall
give  notice  to ICI in  writing  of any item or  items  in the  Final
Completion Statement which it wishes to dispute and the basis on which
it  disputes  that item or those  items and the  changes  to the Final
Completion  Statement which the Purchaser  believes should be made and
ICI and the Purchaser shall use their reasonable endeavours to resolve
that  dispute.  Any items in respect of which the  Purchaser  does not
give  such  notice  will  be  deemed  to  have  been  accepted  by the
Purchaser.  Any written resolution reached by ICI and the Purchaser on
any  disputed  item  shall be final,  conclusive  and  binding  on the
parties.

(7)  If ICI and the Purchaser agree the Final Completion Statement then any
adjusting payments referred to in paragraph (9) below shall be made by
the paying party within seven days of being agreed by the parties.

(8)  If ICI and the  Purchaser  fail to agree on any  element  of the Final
Completion  Statement  within 14 days  after the  Purchaser  has given
notice  in  writing  to ICI of any  item(s)  in the  Final  Completion
Statement  which the Purchaser  wishes to dispute (in accordance  with
paragraph  (6)  above)  then  any  agreed  amounts  shall  be  paid in
accordance  with  the  preceding  paragraph  and  any  dispute  may be
referred by either ICI or the  Purchaser  for final  determination  in
accordance  with  sub-Clause  11.1 of this  agreement  and any amounts
thereby found to be due shall be paid by the relevant  party not later
than seven days after such final determination.

(9)  When the Final  Consideration  is agreed or  otherwise  determined  in
accordance with the three preceding paragraphs the following adjusting
payments shall be made:

(a)     an amount  equal to the  difference  between (i) the Estimated
Consideration  and (ii) the Final Consideration; and

(b)     interest  (calculated  on a  day-to-day  basis and  compounded
monthly) at the Interest  Rate on the amount in paragraph  (9)
(a) above  from the  Completion  Date to the date of  payment,
calculated on a day to day basis

which shall be paid by the  relevant  ICI  Affiliate  to the  relevant
Purchaser Affiliate (or vice versa, as appropriate).

(10)  In this  Schedule,  references to lines of A Forms have been chosen by
ICI and are  believed  in good faith to  correspond  to the matters to
which they refer.  If,  however,  that  reference when compared to the
matter it  describes or refers to is  incorrect  then,  subject to the
Purchaser's  agreement,  there  shall be  substituted  for  that  line
reference  another line  reference (if any) which  corresponds  to the
matter described or referred to. Any dispute between the Purchaser and
ICI as to any matter  arising under this  sub-paragraph  (10) shall be
referred for final determination in accordance with sub-Clause 11.1 of
this Agreement.

2 Enterprise Value (paragraph 1(1) of this Schedule)

Uplift of
Stocks to
fair market
value for the
purpose of
allocation of
consideration
to classes of
assets
EV            NWC 28
US$               GBP             US$

Newco Business               118,410,000         3,950,000 (1)     215,000
TAI:                                                   US$

Americas Business            6,857,000         6,857,000             Nil

(1) As provided in the Hivedown Agreement.

LPC Business
(excluding
LPC Interests):                      Z        15,081,000       1,697,000

TCI:                                 US$             CAN $             US$

Americas Business             14,733,000         7,444,000          62,000

LPC Business                           W         2,575,000             Nil

The  figures  represented  by  Z  and  W in this Section 2 shall be as
agreed between ICI and the Purchaser.

SCHEDULE 4
FURTHER ASSURANCE
(CLAUSE 17)

1  ICI,  DuPont and the Purchaser  recognise that it may be necessary for
certain of the  excluded or shared  assets to be used by the ICI Group
and/or the DuPont Group and the Companies  after the Completion  Date.
If any such assets are  identified  by ICI,  DuPont or the  Purchaser,
ICI,  DuPont and the Purchaser will negotiate in good faith to reach a
sharing arrangement (on a fair, equitable and cost-effective basis) in
relation to such assets.

2  In accordance with its obligations  under the Transfer of Undertakings
(Protection of Employment)  Regulations 1981 (as amended the "TRANSFER
REGULATIONS")  in relation to the  employees  to be employed by Newco,
the Purchaser  shall  promptly  provide TEL, ICI or its  Affiliates in
writing with such  information  as is  reasonably  necessary to enable
TEL, ICI or its  Affiliates to carry out the duties under  Regulations
10(2)(d) and 10(6) of the Transfer  Regulations and the obligations to
consult under the Transfer  Regulations and Council  Directive  77/187
EEC.

3 ICI shall be responsible for the incorporation of Newco.

4

4.1  Up until  the  Completion  Date (or the  earlier  termination  of this
agreement) the parties agree in good faith to co-operate generally and
take all steps as may  reasonably be required (in so far as each party
is able to do so and the same is permitted by law or regulation):-

(a)     for TEL to split  with  Newco  the WSL  Contract  (whether  by
partial assignment or otherwise) on a PRO RATA volume basis by
reference  to that  proportion  of the  ilmenite  ore supplied
under the WSL  Contract  which has been  consumed by the Newco
Business  during  the 12  months  ending  on the  date of this
agreement (THE "AGREED GRIMSBY VOLUME PROPORTION"); and/or

(b)     for TEL to  effect a  sub-contract  arrangement  in  favour of
Newco for a period of two years  from the  Completion  Date in
respect of the WSL Contract  giving to the Newco  Business the
Agreed Grimsby Volume Proportion; and/or

(c)     for contractual  terms to be made available to Newco for Newco
to be supplied,  for a period of at least two years  following
the Completion  Date,  with volumes of ilmenite ore consistent
with those  consumed by the Newco  Business over the 12 months
ending on the date of this agreement (THE "GRIMSBY  HISTORICAL
VOLUME"); and/or

(d)     if  prior  to  the  Completion  Date  the  volumes of ilmenite
ore  contractually  available for supply to the Newco Business
are less than the Grimsby  Historical Volume, for any ilmenite
ore made  available  during the  period  from the date of this
agreement until the second  anniversary of the Completion Date
to TEL or any other  companies  to be sold to DuPont or any of
its Affiliates  upon  completion of the TEL Sale (the "TIOXIDE
GROUP") pursuant to any new contract ("NEW CONTRACT") which is
entered into after the date of this agreement and prior to the
TEL  Completion  Date by any member of the Tioxide Group to be
shared as between the Newco  Business  and the  Tioxide  Group
other than the Newco Business (the "REVISED TIOXIDE Group") so
that the Newco Business is entitled to receive a proportion of
such  ilmenite  ore  equal  to  the  Agreed   Grimsby   Volume
Proportion   but  so  that  the   aggregate  of  ilmenite  ore
contractually  available to the Newco  Business  under any New
Contracts  shall  not,  when  taken  together  with any  other
contractual  arrangements  available to the Newco Business, be
required to exceed the Grimsby Historical Volume.

4.2  If the volumes of ilmenite ore  contractually  available for supply to
the Newco  Business at the  Completion  Date are less than the Grimsby
Historical  Volume,  Dupont  shall use all  reasonable  endeavours  to
procure (if permitted by law or regulation) that any ilmenite ore made
available  during  the  period  of two  years  immediately  after  the
Completion  Date to the  Revised  Tioxide  Group  pursuant  to any new
contract  ("NEW  TIOXIDE  CONTRACT")  which is entered  into after the
Completion  Date is  shared as  between  the  Newco  Business  and the
Revised  Tioxide  Group so that the  Newco  Business  is  entitled  to
receive a proportion of such ilmenite ore equal to the Agreed  Grimsby
Volume  Proportion  but so  that  the  aggregate  of  ilmenite  ore so
contractually  available to the Newco  Business  under any New Tioxide
Contracts  shall not, when taken  together with any other  contractual
arrangements  available to the Newco  Business,  be required to exceed
the Grimsby Historical Volume.

4.3  If the volumes of ilmenite ore  contractually  available for supply to
the Revised  Tioxide  Group at the  Completion  Date are less than the
volumes of ilmenite ore consumed by the Revised Tioxide Group over the
12 months ending on the date of this  agreement,  the Purchaser  shall
use all  reasonable  endeavours  to procure  (if  permitted  by law or
regulation)  that any ilmenite ore made available during the two years
immediately  after the Completion Date to the Newco Business  pursuant
to any new contract which is entered into after the Completion Date is
shared as between the Newco Business and the Revised  Tioxide Group so
that each shall be entitled  to receive  volumes by  reference  to the
proportions  of ilmenite  ore  consumed by the Newco  Business and the
Revised  Tioxide  Group  under the WSL  Contract  during the 12 months
ending on the date of this agreement.

4.4  Neither ICI (for itself or its Affiliates),  Dupont (for itself or its
Affiliates)  nor the  Purchaser  (for itself or its  Affiliates)  will
apply any price mark up  pursuant to the  arrangements  referred to in
sub-clauses  4.1(d),  4.2 and 4.3  (save,  in the case of ICI,  or its
Affiliates, as consistent with practice at the date hereof).

5  On or before the  Completion  Date the  Purchaser  shall  establish or
nominate a retirement  benefits  scheme which satisfies the conditions
set out in Schedule 4 of the Newco Share Sale Agreement.

6  ICI,  DuPont and the  Purchaser  acknowledge  that  certain  property,
rights and assets of or relating  to or used in the Newco  Business as
at the Transfer Time may not  exclusively  relate to or be exclusively
used in the Newco  Business as at such time. If the Purchaser  becomes
aware of any such property,  right or asset at any time after the date
of  this  agreement  and  prior  to the  date  falling  twelve  months
following the  Completion  Date and serves  notice  thereof on ICI and
DuPont,  ICI (prior to the Completion Date) and DuPont  (following the
Completion Date) shall unless otherwise agreed:

(i) make  arrangements  for  the  continued  use of the  same,
subject to the same terms  (including  as to cost and use)
as applied immediately prior to the Completion Date; or

(ii)to the extent such continued use is not  permitted,  make,
insofar as reasonably  possible,  arrangements for the use
of such property, right or asset as is equivalent thereto,
from and after the Completion Date.

To the extent that third party  consents are required,  the provisions
of Schedule 7 of the Hivedown  Agreement shall apply MUTATIS  MUTANDIS
and in  relation  to  sub-paragraph  (ii) the  aggregate  of  payments
required  to  be  made  under  the  existing   arrangements  and  such
equivalent  arrangements  (taking  into  account any increase in costs
thereunder)  shall be borne  equitably  between  ICI,  DuPont  and the
Purchaser.

This  Paragraph  6 shall not apply to the extent  that the use in the
Newco  Business  of the  property,  right  or asset  in  question  is
otherwise   expressly   provided  for  in  the  Newco  Implementation
Agreements.

SCHEDULE 5
(SUB-CLAUSE 1.1)

PRINCIPLES FOR DISTINGUISHING
LPC BUSINESS AND AMERICAS BUSINESS
TAI A FORMS

AMERICAS
(SULPHATE)
LPC BUSINESS      BUSINESS         COMMENTS
--------------------- ----------------- ---------------- ---------------------
--------------------- ----------------- ---------------- ---------------------

- Office equipment
FIXED ASSETS                            All              etc.
--------------------- ----------------- ---------------- ---------------------
INVESTMENTS           All                                - Partnership share
--------------------- ----------------- ---------------- ---------------------
- Based on actual
Stocks                             quantities of
manufactured by   All other        stocks from each
STOCKS                LPC               stocks           source
--------------------- ----------------- ---------------- ---------------------
Sales of                           - Based on detailed
OPERATING DEBTORS     material                           analysis of all
Trade Debtors}        manufactured by   All other        open accounts
Intra Group Debtors}  LPC               trade debtors    concerned
--------------------- ----------------- ---------------- ---------------------
Items exclusive
to LPC
partnership or
trade in
product           All other
Other operating       manufactured by   operating
debtors               LPC               debtors
--------------------- ----------------- ---------------- ---------------------
OPERATING CREDITORS
LESS THAN ONE YEAR    Purchases of      All other        - Based on detailed
Trade Creditors}      material          operating        analysis of all
Intra Group           manufactured by   creditors less   open accounts
Creditors}            LPC               than 1 year      concerned
--------------------- ----------------- ---------------- ---------------------
Purchases and
services
exclusively
related to LPC
partnership and                    - Based on detailed
to material       All other        analysis of all
Other operating       manufactured by   operating        open accounts
creditors             LPC               creditors        concerned
--------------------- ----------------- ---------------- ---------------------
Items                              - Mainly tax split
exclusively                        based on analysis
related to LPC                     of results based on
and materials     All other non    detailed analysis
NON OPERATING         manufactured by   operating        of all open
DEBTORS/CREDITORS     LPC               debtors/creditor accounts concerned
--------------------- ----------------- ---------------- ---------------------
All Net Debt to
NET DEBT              LPC Business
--------------------- ----------------- ---------------- ---------------------
Items
specifically      All other
PROVISIONS            related to LPC    provisions
--------------------- ----------------- ---------------- ---------------------
Items
specifically      All other
DEFERRED INCOME       related to LPC    deferred income
--------------------- ----------------- ---------------- ---------------------
- Calculated by
NET ASSETS                                               difference
--------------------- ----------------- ---------------- ---------------------

NOTES:

1  Pension Liability  (Approx.  US$250,000) is accounted for according to
US rules (FAS87 etc.) in A Form.  Therefore no reconciling  difference
between US and UK GAAP.

2  ICI A Forms do not  report  deferred  tax for  ICI's US  subsidiaries.
However any deferred tax in the US GAAP accounts is readily analysable
into its LPC and  Sulphate and is estimated to derive to the extent of
some 99 per cent. from LPC's tax depreciation.

PRINCIPLES FOR DISTINGUISHING
LPC BUSINESS AND AMERICAS BUSINESS
TCI A FORMS

--------------------- --------------- ---------------- --------------------
AMERICAS
(SULPHATE)
LPC BUSINESS    BUSINESS         COMMENTS
--------------------- --------------- ---------------- --------------------

FIXED ASSETS                          All
--------------------- --------------- ---------------- --------------------
INVESTMENTS           N/A             N/A
--------------------- --------------- ---------------- --------------------
Stocks
manufactured                     - Based on actual
by LPC and                       quantities of
Kronos at       All other        stocks from each
STOCKS                Varennes        stocks           source
--------------------- --------------- ---------------- --------------------
Sales of
material
manufactured                     - Based on
OPERATING DEBTORS     by LPC and                       detailed analysis
Trade Debtors}        Kronos at       All other        of all open
Intra Group Debtors}  Varennes        trade debtors    accounts concerned
--------------------- --------------- ---------------- --------------------
Other operating
debtors                               All
--------------------- --------------- ---------------- --------------------
Purchases of
OPERATING CREDITORS   material
LESS THAN 1 YEAR      manufactured    All other        - Based on
Trade Creditors}      by LPC and      operating        detailed analysis
Intra Group           Kronos at       creditors less   of all open
Creditors}            Varennes        than one year    accounts concerned
--------------------- --------------- ---------------- --------------------
Other operating
creditors                             All
--------------------- --------------- ---------------- --------------------
NON OPERATING
DEBTORS/CREDITORS                     All
--------------------- --------------- ---------------- --------------------
NET DEBT                              All
--------------------- --------------- ---------------- --------------------
PROVISIONS                            All
--------------------- --------------- ---------------- --------------------
DEFERRED INCOME                       All
--------------------- --------------- ---------------- --------------------
- Calculated by
NET ASSETS                                             difference
--------------------- --------------- ---------------- --------------------

NOTE:

Stocks/materials/product  manufactured  by  LPC  includes  items  made
available to LPC under product swap  arrangements  with Kronos's plant
at Varennes.

SIGNED by
for and on behalf of
IMPERIAL CHEMICAL INDUSTRIES PLC }           Peter E Whittle

SIGNED by
for and on behalf of
E.I. DU PONT DE NEMOURS AND
COMPANY                          }           Jeffrey L Keefer

SIGNED by
for and on behalf of
N L INDUSTRIES, INC.             }           Susan E Alderton

EXHIBIT 10.2

1  Reference  is made to the  Framework  Agreement  of even date  between
Imperial Chemical  Industries PLC, E.l. Du Pont de Nemours and Company
and NL Industries, Inc (the "AGREEMENT").

2  For  the  purposes  of  Schedule  3  of  the Agreement,  the following
letters represent the following values:

W = 2,000,000

X = 176,222,000

Y = 30,000,000

Z = 16,778,000

such  that the total  when  aggregated  with the  value in the  column
headed EV in  Section 2 of  Schedule  3 to the  agreement  is equal to
US$365,000,000

....................................      .......................
for Imperial Chemical Industries PLC      for NL Industries, Inc.

....................................      ........................
date                                      date

EXHIBIT 10.3

DATED [              ] 1998

TIOXIDE EUROPE LIMITED
- and -
NEWCO LIMITED

AGREEMENT

- relating to -

the sale and purchase of part of the
business of TIOXIDE EUROPE LIMITED

AGREED FORM

EVERSHEDS
S O L I C I T O R S

Senator House, 85 Queen Victoria Street
London EC4V 4JL
Tel: 0171 919 4500 Fax: 0171 919 4919
Ref : MTI

I N D E X

CLAUSE      DESCRIPTION                                             PAGE NO.

1.          INTERPRETATION                                                 1

2.          SALE                                                           8

3.          CONSIDERATION                                                  9

4.          COMPLETION                                                     10

5.          TITLE AND SUPPLEMENTARY PROVISIONS                             12

6.          DEBTORS,   MATERIALS  BUSINESS  DEBTORS,   RETAINED
BUSINESS CLAIMS AND MATERIALS BUSINESS CLAIMS                  13

7.          NEWCO LIABILITIES                                              15

8.          TEL LIABILITIES                                                15

9.          EMPLOYEES                                                      16

10.         CONTINUING OBLIGATIONS OF TEL AND NEWCO                        16

11.         VAT                                                            17

12.         AVAILABILITY OF INFORMATION                                    19

13.         INDEPENDENT ACCOUNTANT                                         19

14.         DEFAULT INTEREST                                               20

15.         GENERAL                                                        20

16.         WHOLE AGREEMENT                                                21

17.         NON-MERGER AND SURVIVORSHIP                                    22

18.         NOTICES                                                        22

19.         GOVERNING LAW                                                  22

Schedule 1  DESCRIPTION OF THE BUSINESS                                    23

Schedule 2  THE PROPERTIES                                                 24

Schedule 3  EXCLUDED ASSETS AND EXCLUDED LIABILITIES                       26

Schedule 4  ALLOCATION  OF  CONSIDERATION  TO  BUSINESS  ASSETS
PURCHASED                                                      29

Schedule 5  PROVISIONS RELATING TO THE PROPERTIES                          30

CLAUSE      DESCRIPTION                                             PAGE NO.

Schedule 6  PROVISIONS RELATING TO THE CONTRACTS                           33

Schedule 7  PROVISIONS RELATING TO THIRD PARTY CONSENTS                    35

Schedule 8  NOTIFICATION, ASSISTANCE AND PROCEEDINGS                       39

Schedule 9  SUPPLIER CONTRACTS OF A MATERIAL NATURE                        42

Schedule 10 DOCUMENTS IN THE AGREED TERMS                                  43

Schedule 11 EMPLOYEES AND OTHER PERSONNEL                                  44

Schedule 12 SHARED SUPPLIER CONTRACTS                                      47

Schedule 13 TRANSFERRING EMPLOYEES                                         48

Schedule 14 ESTIMATED  CONSIDERATION,  FINAL  CONSIDERATION AND
FINAL COMPLETION STATEMENT                                     49

Annex 1     Pharmacopeia

Annex 2     A Form

Annex 3     ICI's Controller's Manuals

Annex 4     ICI's Auditors Report

THIS AGREEMENT is made on                   1998

BETWEEN:-

(1)   TIOXIDE EUROPE LIMITED (registered in England No. 832447) whose registered
office is at [Lincoln House,  137/143  Hammersmith  Road,  London W14 OQL]
("TEL"); and

(2)   NEWCO LIMITED (registered in England No. [                 ])        whose
registered office is at [                           ] ("NEWCO").

INTRODUCTION

(A)   TEL has agreed to sell and Newco has agreed to purchase  the Business as a
going  concern and the  Business  Assets as at the Transfer  Time,  on the
terms and conditions of this Agreement.

(B) Newco is a wholly owned subsidiary of TEL.

(C) The Business constitutes part of the undertaking of TEL.

IT IS AGREED:-

1.    INTERPRETATION

1.1   Definitions

In this Agreement,  including its Schedules, the headings shall not affect
its interpretation and, unless the context otherwise requires:-

"AFFILIATES"  means with  respect to a  specified  entity,  an entity that
directly or indirectly,  through one or more intermediaries,  Controls, or
is Controlled  by, or is under common  Control with the entity  specified,
provided that, without limiting the generality of the foregoing,  the term
"AFFILIATES"  shall not  include  any entity in which a party has a 50 per
cent. or less ownership interest. For the purposes hereof, "CONTROL" means
possession,  directly or  indirectly,  of the power to direct or cause the
direction  of the  management  and  operating  policies  of the  entity in
respect of which the determination is being made, through the ownership of
voting securities,  contract,  voting trust or otherwise but any reference
in this Agreement to an Affiliate of TEL shall exclude Newco;

"AGREED TERMS" means,  in relation to any document such  document,  in the
terms agreed  between the parties and for the  purposes of  identification
signed by or on behalf of the parties, and listed in Schedule 10;

"BUSINESS" means the business shortly described in Schedule 1;

"BUSINESS ASSETS" means the property, assets and rights of and exclusively
relating to or used in the Business as at the  Transfer  Time as specified
in Clause 2.1 other than the Excluded Assets;

"BUSINESS DATA" means all  information,  know-how and records  (whether or
not  confidential  and no  matter  in what form  held)  of,  and  relating
exclusively to or used  exclusively in, the Business (or otherwise used in
the ordinary  course of the  operation of the Business) as at the Transfer
Time  other  than  Commercial  and  Marketing  Know-how  and  Intellectual
Property but,  subject  thereto,  including the Materials  Commercial  and
Marketing Know-how, all manuals and instructions,  all accounting records,
and all  correspondence,  orders and enquiries  whether in hard copy or in
computer held or other  electronic  form  (including  for the avoidance of
doubt,  such media as microfilm and  microfiche)  but for the avoidance of
doubt shall  exclude  any matter  relating to the  Customer  Contracts  or
Customers;

"COMMERCIAL  AND MARKETING  KNOW-HOW"  means all  commercial and marketing
information  of and relating to or used in the Business as at the Transfer
Time,  other than the Materials  Commercial  and Marketing  Know-How,  but
subject thereto,  including all designs,  specifications,  drawings, lists
and   particulars  of  customers,   marketing   manuals  and   procedures,
advertising copy and sales and promotional information;

"CONTRACTS" means the Supplier  Contracts and the Materials  Customer
Contracts;

"CONTROLLED  WATERS"  means  waters  including  any ground or surface
waters;

"COSTS"  includes all and any penalties,  fines,  costs,  charges and
expenses;

"CUSTOMERS"  means the customers of the Business other than customers
who are only customers of the Materials Business;

"CUSTOMER  CONTRACTS"  means the contracts and commitments  with customers
(other than in relation to  Intellectual  Property)  entered into prior to
the Transfer Time by or on behalf of TEL in  connection  with the Business
for the  manufacture  of goods,  or the supply of goods or services by TEL
which  then  remain to be  performed  in whole or in part,  other than the
Materials Customer Contracts;

"DEBTORS" means the book and other debtors  accruing or owing to TEL as at
the Transfer  Time  (whether or not due and payable) and arising out of or
in connection with the Business  excluding the Materials  Business Debtors
and the Employee Loans;

"DEFAULT  INTEREST"  means  LIBOR  plus 200 basis  points  compounded
monthly;

"EMPLOYEE  LOANS" means all amounts  accruing or owing (whether or not due
and payable) as at the Transfer Time to TEL by Transferring  Employees and
Offer  Employees in respect of housing  assistance  loans or season ticket
loans or any  other  loans or  advances  to  Transferring  Employees  of a
similar nature;

"ENVIRONMENT"  means air, Controlled Waters, land (whether on, in or below
such land, excluding any buildings or other permanent structures on, in or
below the land) but including the surface of any river bed, the surface of
any sea bed or any other land  covered  by water,  and flora and fauna and
all other natural resources;

"ENVIRONMENTAL   AUTHORISATIONS"  means  all  or  any  permits,  consents,
licences,  approvals and other authorisations required under Environmental
Law and all terms and conditions  thereof required under any Environmental
Law for the operation of the Business;

"ENVIRONMENTAL LAW" means any and all legislation (whether civil, criminal
or administrative),  statutes,  treaty,  statutory instrument,  directive,
bylaw  or  judgment  (including  any  judgment  by the  European  Court of
Justice),  regulations,  notices,  orders,  government  circular,  code of
practice,  and guidance note or decision of any competent  regulatory body
or common law relating to pollution or protection of the Environment which
as at the Transfer Time are in effect and capable of  enforcement by legal
process in the country in which the Properties are situated;

"EXCLUDED  ASSETS"  means the assets  excluded  from the sale and purchase
pursuant to this Agreement and identified in Part I of Schedule 3;

"EXCLUDED  LIABILITIES"  means  any  obligations  and  liabilities  of TEL
excluded  from  the sale  and  purchase  pursuant  to this  Agreement  and
identified in Part II of Schedule 3;

"FINAL  COMPLETION  STATEMENT"  has the meaning set out in  paragraph
1.5.2 of Schedule 14;

"FINAL  CONSIDERATION"  has the meaning  given in paragraph  1.5.1 of
Schedule 14;

"FREEHOLD   PROPERTIES"   means   the   freehold   properties   short
particulars of which are set out in Part I of Schedule 2;

"GOODWILL"  means the goodwill in relation to the Business (but  excluding
any rights  relating to the Excluded  Assets) and the right for Newco,  so
far as TEL can grant the same,  to  represent  itself as  carrying  on the
Business  in  succession  to TEL in  accordance  with such terms as may be
agreed between TEL and/or its relevant Affiliate on the one hand and Newco
and/or its relevant Affiliate on the other hand;

"ICI" means Imperial Chemical Industries PLC;

"INTELLECTUAL  PROPERTY"  means all Technical  Information and all rights,
title or interest (including,  without limitation,  the benefit and burden
of any licences of the same)  anywhere in the world in any patents,  trade
marks,  service  marks,  registered  designs,  copyrights  and  rights  to
inventions  and  applications  for and rights to apply for  protection  or
registrations  of  any of  the  same  including  any  continuing  reissue,
divisional and re-examination patent application;

"LEASED  EQUIPMENT  CONTRACTS" means the agreements for the leasing to TEL
of equipment used exclusively in connection with the Business;

"LEASEHOLD PROPERTIES" means the leasehold properties short particulars of
which are set out in Part II of Schedule 2;

"LIBOR"  means the rate for  deposits  in US  Dollars  for a period of one
month which appears on the Reuters Screen ISDA Page (or such other page as
the parties may agree) at  approximately  11.00 am.,  London time,  on the
first  day of the  period  to  which  any  interest  period  relates  (the
"RELEVANT  DATE"). If such rate does not appear on the Reuters Screen ISDA
Page on the  Relevant  Date,  the  rate  for that  Relevant  Date  will be
determined  on the basis of the rates at which  deposits in US Dollars are
offered to Midland Bank plc at  approximately  11.00 am.,  London time, on
the Relevant Date to prime banks in London  interbank  market for a period
of  one  month   commencing   on  that   Relevant   Date  for  amounts  of
US$10,000,000;

"MATERIALS  BUSINESS" means all or any of the businesses shortly described
in Part II of Schedule 1;

"MATERIALS  BUSINESS CLAIMS" means the benefit of all rights and claims of
TEL relating exclusively to the Business Assets or arising exclusively out
of or in connection  with the Materials  Business as at, or the conduct of
the  Materials  Business up to, the Transfer  Time to the extent that such
rights and claims do not constitute Excluded Assets;

"MATERIALS  BUSINESS DEBTORS" means the book and other debtors accruing or
owing to TEL as at the Transfer  Time (whether or not due and payable) and
arising exclusively out of or in connection with the Materials Business;

"MATERIALS  COMMERCIAL  AND MARKETING  KNOW-HOW"  means all commercial and
marketing  information of, and relating exclusively to or used exclusively
in,  the  Materials   Business  as  at  the  Transfer  Time,   other  than
Intellectual Property;

"MATERIALS  CUSTOMER  CONTRACTS"  means the contracts and commitments with
customers  (other than in relation to any Intellectual  Property)  entered
into  prior to the  Transfer  Time by or on behalf of TEL  exclusively  in
connection  with the Materials  Business for the  manufacture of goods, or
the supply of goods or  services,  by TEL which  then  remain (in whole or
part) to be performed by TEL;

"NEWCO COMPLETION DATE" has the meaning given in Schedule 14;

"NEWCO'S  GROUP" means Newco and its Affiliates from time to time but
excluding any member of TEL's Group;

"NEWCO LIABILITIES" means any liabilities  whether actual,  prospective or
contingent or liquidated or  unliquidated  to the extent incurred or owing
by TEL:-

(a)   in connection  with the Business or the Business  Assets as at,
or the conduct of the Business up to, the Transfer Time; or

(b)   in  respect  of events  occurring  or  matters  existing  before the
Transfer  Time which relate to the Business or the Business  Assets;
or

(c)   which are expressly deemed to constitute Newco Liabilities  pursuant
to the terms of this Agreement;

including,  without  prejudice to the  generality  of the  foregoing,  any
Operating Creditors less than 1 year relating exclusively to the operation
of the  Business,  but for the  avoidance of doubt  excluding the Excluded
Liabilities;

"NEWCO PATENT AND KNOW-HOW  LICENCE" means the licence in the Agreed Terms
to be entered into between E. I. du Pont de Nemours and Company and Newco;

"NON EXEMPT  PROPERTY"  means any  Property  notified in writing by TEL to
Newco at least 14 days prior to the Transfer Time;

"OFFER  EMPLOYEES"  means  those  employees  of TEL  and/or  ICI  and  its
Affiliates  who have been  offered  and  accepted  employment  with  Newco
pursuant to Schedule 11;

"OPERATING CREDITORS LESS THAN 1 YEAR" has the meaning set out in Schedule
14;

"PERMITS" means all licences, permits, authorisations and approvals issued
or granted by  statutory or local  authorities  to TEL for the purposes of
operation  of the Business  (but  excluding,  for the  avoidance of doubt,
planning  permissions  (save for Environmental  Authorisations)  issued by
relevant planning authorities);

"PLANT AND  EQUIPMENT"  means the fixed and loose plant and  machinery and
all other  fixtures and fittings,  spare parts,  equipment,  furniture and
motor  vehicles owned by TEL and located at the Properties at the Transfer
Time and used exclusively in the Business;

"PROPERTIES" means the Freehold Properties and the Leasehold Properties;

"REGULATIONS"  means the Value  Added Tax  (General)  Regulations  1985 as
amended;

"RETAINED  BUSINESS"  means all or any of the  businesses  of TEL's  Group
other than the Business;

"RETAINED  BUSINESS  CLAIMS" means the benefit of all rights and claims of
TEL as at the Transfer Time except for the Materials Business Claims;

"SHARED SUPPLIER  CONTRACTS" means contracts and commitments  entered into
prior to the Transfer  Time by or on behalf of TEL for the supply of goods
or services in connection with both the Business and the Retained Business
(other than in relation to Intellectual  Property) which then remain to be
performed in whole or in part and listed in Schedule 12;

"STOCK-IN-TRADE"   means  the  stocks  of  raw   materials,   consumables,
work-in-progress  and finished products owned by TEL relating  exclusively
to the Business and located at any of the  Properties at the Transfer Time
but excluding any finished products and work-in-progress  which is located
at but has not been manufactured at any of the Properties;

"SUPPLIER CONTRACTS" means contracts and commitments (including the Leased
Equipment  Contracts)  entered  into prior to the  Transfer  Time by or on
behalf of TEL for the supply to TEL of goods or  services  exclusively  in
connection  with the  Business  (other than in  relation  to  Intellectual
Property) which then remain to be performed in whole or in part,  those of
material nature being listed in Schedule 9;

"TAXATION"  means all  forms of direct  and  indirect  taxation  including
statutory,   governmental,   state,  provincial,   local  governmental  or
municipal impositions in each case imposed on net income,  profits,  gains
or net worth and whether of the United  Kingdom or  elsewhere in the world
(including  interest,  costs or penalties  relating  thereto) and, for the
avoidance of doubt, the term shall include rates or other taxes imposed on
properties,  landfill taxes, customs duties,  national insurance payments,
taxes  imposed on  payments  to, or income of,  third  parties  (including
employees) or sales or value added taxes;

"TECHNICAL INFORMATION" means all technical data and know-how,  industrial
and  technical  information,   trade  secrets,  confidential  information,
drawings,   formulations,   technical   reports,   operating  and  testing
procedures,    instruction    manuals,    raw   material   or   production
specifications,  the results of research and development work,  whether in
hard copy or in computer held form (including, for the avoidance of doubt,
such media as microfilm and microfiche) and existing computer software the
Intellectual Property in which is owned by TEL (or TEL's Affiliates);

"TEL'S GROUP means TEL and its Affiliates from time to time;

"TEL LIABILITIES"  means any liabilities,  whether actual,  prospective or
contingent or liquidated or  unliquidated  to the extent incurred or owing
by TEL or any member of TEL's Group:-

(a)   in  connection  with the Retained  Business as at, or the conduct of
the Retained Business up to, the Transfer Time; or

(b)   in  respect  of events  occurring  or  matters  existing  before the
Transfer Time and relating to the Retained Business; or

(c)   which constitute Excluded Liabilities; or

(d)   which are expressly deemed to constitute TEL Liabilities pursuant to
the terms of this Agreement; or

(e)   in respect of any liability to Taxation of TEL;

and, for the avoidance of doubt shall  include  Operating  Creditors  less
than 1 year which do not relate exclusively to the Business;

"TRANSFER  REGULATIONS" means the Transfer of Undertakings  (Protection of
Employment) Regulations 1981;

"TRANSFERRING  EMPLOYEES"  means those employees of TEL and/or ICI and its
Affiliates who are immediately  prior to the Transfer Time employed in the
Business whose names are set out in Schedule 13;

"TRANSFER  TIME" means  immediately  after 00.00 hours London time on
* 1998 [IE FIRST DAY OF THE MONTH];

"ULTRAFINE    TITANIUM    DIOXIDE"    means    titanium    dioxide   being
ultraviolet-attenuating grade having a ratio of absorbance response at 308
nm (A308) to  absorbance  response  at 524 nm (A524) of not less than 5 as
defined in US  Pharmacopeia,  amendment  published in Pharmacopeia  Forum,
Volume 22, Number 4, Page 2636 and attached hereto as Annex 1;

"US DOLLARS",  "US$" or "$" means the lawful currency of the United States
of America;

"VAT"  means value  added tax  imposed by a Member  State of the  European
Community  pursuant  to  the  Sixth  Council  Directive  (77/338/EEC)  and
Supplemental Directives;

"VATA" means the Value Added Tax Act 1994;

1.2   Any reference in this Agreement or any other agreement in the Agreed Terms
or in any instrument executed pursuant hereto or thereto to any obligation
assumed by TEL, or any intention of TEL or Newco, to give or vest in Newco
the Business or the Business  Assets or the benefit of the Business or the
Business  Assets shall be subject to Clause 2.2 and so that TEL shall not,
by virtue of any such provision,  be obliged to transfer to Newco any such
right,  title or interest in the Business or any  Business  Asset which is
greater than such right, title or interest as TEL may have in the Business
and the Business Assets.

1.3   Any express reference to an enactment includes references to:-

1.3.1 that enactment as amended, extended or applied by or under any other
enactment before or after this Agreement;

1.3.2 any enactment  which that enactment  re-enacts (with or without
modification); and

1.3.3 any  subordinate  legislation  made (before or after this Agreement)
under any  enactment,  including  one within  Clause  1.3.1 or 1.3.2
above,

except to the extent that any of the matters  referred to in Clauses 1.3.1
to 1.3.3 occurring after the date of this Agreement  increase or alter the
liability of TEL under this Agreement.

1.4   The singular  shall  include the plural and vice versa and words  denoting
persons shall include bodies corporate and unincorporated  associations of
persons and, unless otherwise stated,  shall include successors or assigns
of such persons.

1.5   Clauses 1.1 to 1.3 apply unless the context otherwise requires.

1.6   The headings in this Agreement do not affect its interpretation.

1.7   Any Schedule or Annex to this Agreement shall take effect as if set out in
this  Agreement  and  references  to  this  Agreement  shall  include  its
Schedules and Annexes.

2.    SALE

2.1   THE SALE

Subject to the terms of this  Agreement,  TEL shall  sell and Newco  shall
purchase  as a  going  concern  as  at  the  Transfer  Time  the  Business
comprising  the  Business  Assets as specified in this Clause 2.1 below so
far as TEL can sell or grant the same:

2.1.1 the Properties;

2.1.2 the Plant and Equipment;

2.1.3 the Stock-in-Trade;

2.1.4 the Employee Loans;

2.1.5 the  benefit  (so  far as the  same  can  lawfully  be  assigned  or
transferred to, or held in trust absolutely for, or can otherwise be
given to, Newco) of the Materials Business Claims;

2.1.6 the Goodwill;

2.1.7 the Materials Commercial and Marketing Know-How;

2.1.8 the benefit, subject to the burden of the Contracts;

2.1.9 the Business Data; and

2.1.10 the Materials Business Debtors;

but excluding the Excluded  Assets.

The Excluded Assets and all rights and benefits  relating thereto shall be
retained  by TEL and are  excluded  from  the  sale  and  purchase  of the
Business and the Business Assets to Newco under this Agreement.

2.2   WARRANTIES, INDEMNITIES AND REPRESENTATIONS

Except as  otherwise  expressly  provided  in this  Agreement  (but having
regard  to the  provisions  of  Clause  1.2) no  warranties,  indemnities,
representations  or  undertakings  (in  any  case,  express,   implied  or
otherwise)  with regard to the Business,  the Business Assets or the title
of TEL thereto are given by TEL, nor are the same to be implied, by virtue
of TEL entering into this Agreement,  or any other agreement in the Agreed
Terms or executing any instrument  pursuant  hereto or thereto or selling,
conveying or transferring or agreeing to sell, convey or transfer the same
pursuant  hereto or thereto.  The Business  Assets are  purchased by Newco
pursuant to this  Agreement on an "as seen" and "as is" basis.  TEL shall,
and shall be obliged  to,  transfer,  to Newco only such  right,  title or
interest as it may have subject to all liens, charges, impediments, claims
and encumbrances as may exist thereon. Newco shall accept without enquiry,
requisition  or  objection  such title as TEL may have in the Business and
the Business Assets.

2.3   THE PROPERTIES

The  Properties  shall  be sold  and  purchased  on the  terms  set out in
Schedule 5.

2.4   POST-TRANSFER TIME LIABILITIES

2.4.1 Save  as  expressly  stated  otherwise  in  this  Agreement,   Newco
undertakes  to indemnify  and hold harmless TEL from and against all
liabilities  which may be  incurred  by TEL (or any  member of TEL's
Group) or to which TEL (or any  member of TEL's  Group)  may  become
subject,  and  which  arise  as a  result  of the  operation  of the
Business  after  the  Transfer  Time  (other  than  any  liabilities
expressly  retained  by TEL under  this  Agreement)  and any and all
actions,  suits,  proceedings,   claims,  demands,  assessments  and
judgments  with  respect to the  foregoing.  Any such  liability  in
respect of which Newco shall be liable to indemnify TEL (and members
of TEL's Group) as aforesaid  shall  constitute a "Newco  Liability"
for the purposes of Clause 7 and Schedule 8.

2.4.2 Save as expressly stated otherwise in this Agreement, TEL undertakes
to  indemnify  and  hold   harmless   Newco  from  and  against  all
liabilities which may be incurred by Newco (or any member of Newco's
Group) or to which Newco (or any member of Newco's Group) may become
subject,  and  which  arise  as a  result  of the  operation  of the
Retained   Business   after  the  Transfer   Time  (other  than  any
liabilities expressly assumed by Newco under this Agreement) and any
and all actions, suits,  proceedings,  claims, demands,  assessments
and judgments with respect to the foregoing.  Any such liability for
which TEL shall be liable to indemnify Newco (and members of Newco's
Group) as  aforesaid  shall  constitute  a "TEL  Liability"  for the
purposes of Clause 8 and Schedule 8.

3.    CONSIDERATION

3.1   THE CONSIDERATION

The consideration for the sale of the Business Assets shall be:-

3.1.1 Subject  to  adjustment   pursuant  to  sub-clause  3.2  below,  US$
118,410,000   ("THE  ESTIMATED   CONSIDERATION")   which  sum  shall
constitute  a debt  owed by  Newco  to  TEL,  without  security  and
repayable  forthwith  upon  demand  by  TEL  ("THE  ESTIMATED  NEWCO
HIVEDOWN DEBT"); and

3.1.2 an  obligation  on the  part  of  Newco  to  assume,  pay,  satisfy,
discharge,  fulfil and indemnify  TEL against all Newco  Liabilities
and Costs in respect  thereof in accordance  with the  provisions of
Clause 7.

3.2   The  Final   Consideration  shall  be  agreed  or  finally  determined  in
accordance  with the provisions of Schedule 14 and any adjusting  payments
between TEL and Newco shall be made in accordance  with the  provisions of
Schedule 14.

3.3   ALLOCATION OF THE FINAL CONSIDERATION

The Final  Consideration shall be allocated to each of the Business Assets
as specified in Schedule 4.

4.    COMPLETION

4.1   TIME OF COMPLETION

Completion of this Agreement shall take place at the Transfer Time.

4.2   DELIVERY BY TEL

Except as  otherwise  provided in this  Agreement  and  specifically,  but
without  limitation,  without  prejudice  to Clause  5.3, at or as soon as
practicable  after the Transfer  Time,  TEL shall cause to be delivered or
made available to Newco at such place as Newco may reasonably require:-

4.2.1 such  documents  as Newco may  reasonably  require and which TEL has
available  to it or  under  its  control  to  complete  the sale and
purchase of the Business  Assets  (including  all documents of title
which TEL has in its possession or control,  any requisite  consents
or licences which TEL may have obtained,  such executed conveyances,
transfers and assignments as Newco may reasonably require to vest in
Newco the benefit of the properties, rights and assets hereby agreed
to be sold) and shall permit Newco to enter into and take possession
of the Business;

4.2.2 possession  of  the  Properties  and of the  other  tangible  assets
comprised in the  Business  Assets  including  all  inventories  and
records (whether in computerised or other form) exclusively relating
to the Business  (but not those  relating to the general  affairs of
TEL or to any Excluded Assets or Excluded Liabilities or required by
law to be retained by TEL, but insofar as any such documents  relate
to the Business and are  reasonably  required by Newco,  Newco shall
have the right to examine  the same at all  reasonable  times and to
make copies thereof and to take extracts therefrom);

4.2.3 insofar as the same have not already been  delivered  to Newco,  the
documents  in  Agreed  Terms,  in  the  case  of  any  agreement  or
instrument  to be delivered by TEL,  duly  executed by TEL or any of
its Affiliates.

4.3   DELIVERY BY NEWCO

Newco shall deliver to TEL the documents in the Agreed Terms duly executed
by Newco.

4.4   DELIVERY OF BUSINESS ASSETS

TEL may at any time prior to the Transfer  Time,  execute and deliver,  or
cause  to be,  or may  have,  or  may  have  caused  to be,  executed  and
delivered,  to Newco such  documents  as shall be  required to transfer to
Newco  (whether  or not  subject  to any  necessary  formalities  such  as
stamping,  registration  in any  register,  production  to any  person  or
otherwise)  legal title to any of the Business  Assets which execution and
delivery  shall be carried  out,  in respect  of the  Business  Assets the
subject thereof,  in discharge of, and shall  accordingly  discharge,  the
obligations  of TEL under  Clause 4.2.  TEL and Newco agree and  undertake
that the execution and delivery by TEL as  contemplated in this Clause 4.3
of any conveyance, transfer or assignment in respect of any Property shall
be made on the terms contained in Schedule 5.

4.5   DELIVERY OF CONSIDERATION

Newco  shall  execute  and  deliver  to TEL  such  documents  as  TEL  may
reasonably  require  evidencing  the  assumption  by  Newco  of the  Newco
Liabilities pursuant to Clause 3.1.2.

4.6   PERMITS

To the extent that the same has not been carried out prior to the Transfer
Time,  as soon as possible  thereafter  Newco  and/or TEL (as the case may
require) shall apply to the relevant governmental and/or local authorities
to arrange for the transfer or  assignment to Newco or the re-issue in the
name of  Newco  of each of the  Permits  (insofar  as they  relate  to the
Business) with effect from the Transfer Time in each case upon terms which
will enable Newco to continue to conduct the Business substantially in the
manner in which the Business is currently  conducted at the Transfer Time.
Furthermore,   each  of  Newco  and/or  TEL  shall  use  their  respective
reasonable efforts to effect each such transfer, assignment or re-issue as
promptly  as  practicable  after  the  date  of  this  Agreement.  For the
avoidance  of doubt  nothing  in this  Clause  4.5 shall  give rise to any
liability on the part of TEL for any additional cost as may be required on
the  part of  Newco  in  connection  with  such  transfer,  assignment  or
re-issue.

4.7   Newco  hereby  accepts  and  agrees  that TEL shall not be liable  for any
failure or refusal by any  relevant  governmental  or local  authority  to
arrange or effect the transfer or  assignment  to Newco or the re-issue in
the name of Newco of any of the Permits as aforesaid.

4.8   INVESTMENT GRANTS

As soon as practicable  after the Transfer  Time,  Newco shall execute and
deliver such undertakings and indemnities as TEL may reasonably require to
ensure so far as may be possible that:-

4.8.1 TEL will not (by reason of the sale under this Agreement or anything
done or omitted to be done by Newco or its  successors  in title) be
or become liable to repay any grants from any governmental, local or
public authority received by TEL in relation to the Business; and

4.8.2 TEL will be able to claim and to  receive  for its own  benefit  any
additional  such grants in respect of expenditure  made prior to the
Transfer  Time  to  which  it  would  have  become  entitled  had it
continued to use the relevant assets in the Business.

5.    TITLE AND SUPPLEMENTARY PROVISIONS

5.1   TITLE TO THE PROPERTIES

The provisions of Schedule 6 shall apply in respect of the Properties.

5.2   TITLE TO OTHER BUSINESS ASSETS

Unless  otherwise  agreed  between  TEL and Newco,  title to all  Business
Assets  which are capable of  transfer by delivery  shall pass on delivery
thereof  and such  delivery  shall be  deemed to have  taken  place at the
Properties (or such other  properties at which the Business is carried on)
at and with effect from the Transfer Time.

5.3   BENEFICIAL OWNERSHIP AND RISK

Save to the extent otherwise  provided in this Agreement and specifically,
but without limitation,  in Clause 4.3,  beneficial  ownership and risk in
respect of the Business  and the Business  Assets shall pass and be deemed
to have passed to Newco at the Transfer Time. TEL shall,  subject to being
fully indemnified by Newco, hold the relevant Business Assets on trust for
Newco  absolutely as from the Transfer Time until the same shall have been
delivered  and/or formally  transferred or assigned to Newco and TEL shall
grant to Newco such powers of attorney as Newco may reasonably  require to
enable  Newco to vest in itself or  otherwise to deal with such assets and
shall deliver to Newco forthwith upon receipt any notice or other document
concerning or relating to such assets.

5.4   THIRD PARTY CONSENTS

Subject to Clause 7, the  provisions  of Schedule 7 shall apply in respect
of the  sale  and  purchase  of any  Business  Asset  referred  to in such
Schedule and in respect of the assumption by Newco of any Newco  Liability
referred to in such  Schedule and shall,  in respect of any such  matters,
override any other provision of this Agreement (other than Clauses 1.3 and
2.2 and 7 which shall override the provisions of such Schedule) .

6.    DEBTORS,  MATERIALS  BUSINESS  DEBTORS,  RETAINED BUSINESS CLAIMS AND
MATERIALS BUSINESS CLAIMS

6.1   ASSIGNMENT OF PROCEEDS

TEL shall  assign  or  procure  that  there is  assigned  to Newco any net
proceeds  of  recovery  of any  Materials  Business  Debtor  or  Materials
Business  Claim for Newco to retain  for its own  account.  Any  Materials
Business  Debtor  received  by TEL shall be received by TEL as trustee for
Newco  absolutely,  TEL shall record such payment  separately in its books
and shall account to Newco for the same as soon as reasonably  practicable
after receipt.  For the avoidance of doubt the net proceeds of recovery to
be assigned shall be calculated  after  deducting any VAT for which TEL is
liable to account to H M Customs & Excise in respect of the sum payable by
the Materials Business Debtor.

6.2   MATERIALS BUSINESS DEBTORS AND MATERIALS BUSINESS CLAIMS

If any Materials  Business  Debtor or Materials  Business Claim is not, or
gives rise to a cause of action  which is not,  capable of  assignment  to
Newco (in such  manner  as to permit  Newco to  prosecute  such  Materials
Business  Debtor or Materials  Business  Claim in its own name) and in the
case of any Materials Business Debtor or Materials Business Claim which is
capable of assignment  to Newco in such manner and has not been  assigned,
pending such assignment, Newco shall be entitled at its own expense in its
absolute  discretion to take such action as Newco shall deem  necessary or
desirable to  prosecute,  settle or  compromise  such  Materials  Business
Debtor or Materials Business Claim, or to avoid, dispute,  resist, appeal,
compromise  or contest any related  counter-claim  to the extent that such
counter-claim  is a Newco  Liability,  in the name of TEL, and to have the
conduct of any related proceedings, negotiations or appeals.

6.3   INDEMNITY

Newco shall  indemnify TEL against all  liabilities and Costs which it may
incur in  complying  with  Clauses 6.1 to 6.4  inclusive  or  otherwise in
connection with any such Materials  Business Debtor or Materials  Business
Claim or related counter claim to the extent that such  counter-claim is a
Newco Liability.

6.4   NOTIFICATION, ASSISTANCE AND PROCEEDINGS

The provisions of Schedule 8 shall apply to:-

6.4.1 the notification by one party to the other party of information with
respect to Materials Business Debtors or Materials Business Claims;

6.4.2 the  giving  of  assistance  by TEL to  Newco  for the  purposes  of
recovering  any  amount  due in  respect  of, or  compromising,  any
Materials  Business Debtor or Materials  Business Claim or avoiding,
disputing,  resisting,  appealing,  compromising  or contesting  any
related counter-claim to the extent that such
counter claim is a Newco Liability; and

6.4.3 the conduct of any proceedings in respect of any Materials  Business
Debtor or Materials  Business Claim or any related  counter-claim to
the extent that such counter-claim is a Newco Liability.

6.5   ACCOUNTING BY NEWCO FOR DEBTORS RECEIVED

Any Debtor received by Newco shall be received by Newco as trustee for TEL
absolutely,  Newco shall record such payment  separately  in its books and
shall account to TEL for the same as soon as reasonably  practicable after
receipt.

6.6   NOTIFICATION, ASSISTANCE AND PROCEEDINGS

The provisions of Schedule 8 shall apply to:-

6.6.1 the notification by one party to the other party of information with
respect to Debtors or Retained Business Claims;

6.6.2 the  giving  of  assistance  by  Newco  to TEL for the  purposes  of
receiving any amount due in respect of, or comprising, any Debtor or
Retained   Business   Claim  or  avoiding,   disputing,   resisting,
appealing,  compromising or contesting any related  counter-claim to
the extent that such counter claim is a TEL Liability; and

6.6.3 the conduct of any  proceedings  in respect of any Debtor,  Retained
Business Claim or any related  counter-claim to the extent that such
counter-claim is a TEL Liability.

7.    NEWCO LIABILITIES

7.1   ASSUMPTION OF NEWCO LIABILITIES

Newco agrees to assume,  pay, satisfy,  discharge and fulfil all the Newco
Liabilities and Costs in respect thereof.

7.2   CONDUCT OF NEWCO LIABILITIES

Newco shall be entitled at its own expense in its absolute  discretion  to
take  such  action  as it shall  deem  necessary  or  desirable  to avoid,
dispute, defend, resist, appeal,  compromise or contest in the name of TEL
any claims of, or proceedings instituted or threatened by, any third party
whether before or after the date hereof, in respect of any Newco Liability
and to have  the  conduct  of any  related  proceedings,  negotiations  or
appeals.

7.3   INDEMNITY

Newco shall indemnify:-

7.3.1 TEL against all Newco Liabilities; and

7.3.2 TEL  against  all  liabilities  and  Costs  which  it may  incur  in
complying  with this Clause 7 or  otherwise in  connection  with any
Newco Liability.

7.4   NOTIFICATION, ASSISTANCE AND PROCEEDINGS

The provisions of Schedule 8 shall apply to:-

7.4.1 the notification by one party to the other party of information with
respect to Newco Liabilities;

7.4.2 the giving of  assistance  for the purposes of avoiding,  disputing,
resisting,   appealing,   compromising   or  contesting   any  Newco
Liability; and

7.4.3 the conduct of any proceedings in respect of any Newco Liability.

8.    TEL LIABILITIES

8.1   TEL LIABILITIES

TEL shall be  entitled at its own expense in its  absolute  discretion  to
take  such  action  as it shall  deem  necessary  or  desirable  to avoid,
dispute,  defend, resist, appeal,  compromise or contest any claims of, or
proceedings  instituted or threatened by, any third party,  whether before
or after the date hereof,  in respect of any TEL Liability and to have the
conduct of any related proceedings, negotiations or appeals.

8.2   INDEMNITY

TEL shall indemnify:-

8.2.1  Newco against all TEL Liabilities; and

8.2.2 Newco  against  all  liabilities  and  Costs  which it may  incur in
complying with this Clause 8 or otherwise in connection with any TEL
Liability.

8.3   NOTIFICATION, ASSISTANCE AND PROCEEDINGS

The provisions of Schedule 8 shall apply to:-

8.3.1 the notification by one party to the other party of information with
respect to TEL Liabilities;

8.3.2 the  giving  of  assistance  by  Newco  to TEL for the  purposes  of
avoiding,   disputing,   resisting,   appealing,   compromising   or
contesting any TEL Liability; and

8.3.3 the conduct of any proceedings in respect of any TEL Liability.

9.    EMPLOYEES

The  provisions  of  Schedule  11  shall  apply  in  relation  to  certain
employment and related matters.

10.   CONTINUING OBLIGATIONS OF TEL AND NEWCO

10.1  FURTHER ASSURANCES

TEL  shall  (at  Newco's  Cost)  from time to time  execute  such  further
assurances  and afford to Newco such  assistance  as Newco may  reasonably
require  which is within TEL's control for the purpose of vesting in Newco
or its  nominee  the  benefit  of the  Business  and the  Business  Assets
(including,  so far as consistent  with the terms of this  Agreement,  the
benefit of any rights accruing against third parties,  whether such rights
have or have not accrued or become  enforceable  as at the Transfer  Time)
and of all the provisions of this Agreement.

10.2  SHARED SUPPLIER CONTRACTS

TEL agrees,  to the extent that it is able, to make onward supply of those
goods or services  provided under Shared Supplier  Contracts to the extent
that  those  goods or  services  would  have been  utilised  by TEL in the
Business  had it not been  transferred  to Newco  pursuant to the terms of
this Agreement on the basis that Newco shall bear its proportionate  share
of the net cost and expenses under such Shared Supplier Contracts.

10.3  ENVIRONMENTAL AUTHORISATIONS

TEL shall give all reasonable assistance (other than financial assistance)
to  Newco  in  applying  for,  or  arranging  for  the  transfer  of,  the
Environmental Authorisations.

10.4  CONTRACTS

The provisions of Schedule 6 shall apply.

10.5  CUSTOMER CONTRACTS

To the extent  that  payment  is made to Newco in respect of any  Customer
Contract after the Transfer Time,  Newco shall receive the same as trustee
for TEL absolutely,  shall record such payment separately in its books and
shall account to TEL for the same as soon as reasonably  practicable after
receipt.

10.6  NEWCO TAXATION LIABILITIES

Newco shall be responsible  for all  liabilities  to Taxation  incurred or
owing by it  (whether or not due and  payable) in respect of the  Business
following the Transfer  Time  including any stamp duty arising as a result
of this Agreement or its completion.

11.   VAT

11.1  TEL and  Newco  intend  that  article 5 of the  Value  Added Tax  (Special
Provisions)  Order 1995  ("ARTICLE 5") shall apply to the sale or sales of
the Business under, or procured under, this Agreement, so that the sale or
sales are treated as neither supplies of goods nor supplies of services.

11.2  If  nevertheless  any VAT is  payable  on any  supply by TEL or any supply
which is  procured  by TEL under this  Agreement,  Newco  shall pay it the
amount  of that VAT in  addition  to the  price  (and if Newco  delays  or
defaults in  complying  with its  obligations  under Clause 11.3 pay it an
amount  equal to any  interest  and  penalties  imposed by HM Customs  and
Excise  (whether on TEL or another person) arising out of the treatment by
TEL and Newco of the sale as described in Clause 11.1 above).

11.3  Without  limiting  Clause  11.2,  VAT shall be  treated  as  payable if HM
Customs and Excise rule that it is payable  after full  disclosure  of all
material  facts.  If they have done so before the Transfer  Time,  the tax
shall be payable by Newco on the Transfer  Time against  issue of a proper
VAT invoice (issued by TEL or other appropriate person) in respect of such
VAT. If they do so on or after the Transfer Time, the tax shall be payable
by Newco  within  five days after TEL gives  Newco  written  notice of the
ruling  together  with a  proper  VAT  invoice  (issued  by  TEL or  other
appropriate person) in respect of that VAT.

11.4  If Newco  fails to pay the amount of the tax on the due date under  Clause
11.3, it shall pay Default Interest on that amount from the due date until
actual payment (excluding any period for which interest  indemnified under
Clause 11.2 runs) compounded  monthly except to the extent to which TEL is
fully  compensated  for Newco's delay by reason of the indemnity in Clause
11.2 extending to interest.

11.5  With a view to procuring that article 5 applies, Newco:

11.5.1shall ensure that Newco is  registered  for VAT not later
than the date of the Transfer Time;

11.5.2warrants  that  the  Business  Assets  are to be  used by  Newco  in
carrying on the same kind of  business  as that  carried on by TEL's
Group and its Affiliates;

11.5.3warrants  that  Newco  has,  or  will  by the  relevant  date  have,
properly  made an  election  to waive  exemption  in respect of each
Non-Exempt  Property  with  effect  from a day not  later  than  the
relevant date (having obtained the written  permission of HM Customs
and Excise if  necessary)  and has, or will by that date have,  duly
given to HM  Customs  and  Excise the  written  notification  of the
election required to make the election effective; and

11.5.4covenants  that  Newco will not revoke  the  election  within  three
months after the relevant date.

In this paragraph "RELEVANT DATE" has the same meaning as in paragraph (2)
of article 5.

11.6  TEL and Newco  envisage  that s. 49 of the Value Added Tax 1994 will apply
to the sale and purchase of the Business  Assets under this  Agreement but
intend that TEL should retain the records referred to in that section, and
accordingly:

11.6.1notwithstanding   anything  in  this  Agreement  TEL  shall  not  be
required to deliver to Newco the records referred to in s.49;

11.6.2TEL shall  make a request to HM  Customs  and Excise  under s.49 for
the records to be preserved by TEL;

11.6.3if or for  so  long  as  that  request  is not  granted,  TEL  shall
preserve  the  records on behalf of Newco for such  period as may be
required  by  law,  and  shall  during  that  period   permit  Newco
reasonable access to them to inspect or make copies of them; and

11.6.4TEL may fulfil its  obligations  under  Clause  11.6.3 by  procuring
that a  future  transferee  of its  business  or  any  other  person
preserves the records and permits  reasonable access as mentioned in
that paragraph,  in which case TEL shall notify Newco of the name of
that person.

11.7  In respect of each Non-Exempt Property mentioned in Clause 11.5.1 either:

11.7.1without  prejudice to that  subclause,  Newco shall on or before the
Transfer Time give to TEL evidence  reasonably  satisfactory  to TEL
that the election has been made and written  notification duly given
in accordance with that subclause; or

11.7.2if Newco  does not give  that  evidence,  it shall be  assumed  that
those  things  have not been done and  notwithstanding  Clause  11.3
Newco  shall  on the  Transfer  Time  pay to TEL the  amount  of VAT
chargeable  in respect of the relevant  Non-Exempt  Property on that
assumption but any  forbearance of TEL to insist on its rights under
this  subclause  shall be without  prejudice to its rights under the
preceding provisions of this clause.

11.8  References in Clause 11.5 to Newco shall be construed as references to the
transferee within the meaning of the corresponding  provision of article 5
if different.

12.   AVAILABILITY OF INFORMATION

Each of TEL and Newco  shall  make  available  to the other free of charge
upon written  request all  information  (or copies of any  information  in
writing) which the other may reasonably  require  relating to the Business
and the  Business  Assets  (including,  without  limitation,  any  records
required  for the  purposes  of VATA or the  Regulations  or  relating  to
taxation of any kind  (including  Taxation)  but not for the  avoidance of
doubt the Customer Contracts or the Commercial and Marketing Know-How).

13.   INDEPENDENT ACCOUNTANT

13.1  If either party wishes to refer any matter in dispute in  accordance  with
the  provisions  of Clause 3 or Schedule 14 for  determination  under this
Clause it shall give notice to the other  requiring the  appointment of an
independent accounting firm of international  reputation ("THE INDEPENDENT
ACCOUNTANT")  excluding  accounting  firms who have acted as  auditors  of
either  party or of any of their  Affiliates  in the last 5 years.  If the
parties are unable to agree upon the Independent Accountant within 14 days
of such notice, then the Independent  Accountant shall be appointed by the
President for the time being of the Institute of Chartered  Accountants in
England and Wales on the application of either party.

13.2  The Independent Accountant shall act as an expert and not as an arbitrator
and his  decision  shall (in the absence of  manifest  error) be final and
binding  on the  parties.  The  Independent  Accountant  shall  afford the
parties the opportunity of making written representations to him and shall
make his determination within 40 days of his appointment.

13.3  The fees and expenses of the Independent  Accountant shall be borne by the
parties  in equal  shares  unless  the  Independent  Accountant  otherwise
determines.

14.   DEFAULT INTEREST

Subject as otherwise  provided to the contrary in this  Agreement,  if any
sum due for  payment  under  this  Agreement  or in  accordance  with this
Agreement  is not paid on the due date the  party  in  default  shall  pay
Default  Interest  on that sum from the due date  until the date of actual
payment calculated on a day to day basis.

15.   GENERAL

15.1  Unless otherwise expressly stated, all claims made and payments to be made
under this Agreement shall be made in US Dollars. Payments to TEL shall be
made in immediately  available funds to the account of TEL at such account
as TEL may notify to Newco and to Newco in immediately  available funds to
such  account as Newco may notify to TEL.  All  payments  and values under
this  Agreement  shall be in US Dollars  and where an amount is not itself
calculated  in US Dollars,  it shall be  converted  into US Dollars at the
mid-market  closing  exchange  rate for that  currency  into US Dollars as
published  in the  London  Edition  of The  Financial  Times  published  2
Business  Days prior to the date on which the  relevant  payment is due or
where no such rate is published,  at the rate quoted by Citibank,  N.A. at
the close of business in London on that date.  This  sub-clause  shall not
apply to Schedule 14.

15.2  Save as otherwise provided to the contrary in this Agreement, each payment
to be made under this Agreement shall be made in the currency in which the
relevant  amount  is  payable,   free  and  clear  of  all  deductions  or
withholdings  of any kind,  except for those  required by law,  and if any
deduction or withholding must be made by law, an additional amount will be
paid which is necessary to ensure that the recipient receives a net amount
equal to the full amount  which it would have  received if the payment had
been made without the deduction or withholding.

15.3  None of the rights or obligations  under this Agreement may be assigned or
transferred   without  the  written  consent  of  the  other  party  ("the
Non-Assigning  Party") other than an assignment of the rights (but not the
obligations) to an Affiliate of the assigning party provided that:

(a)   such  assignment  shall only be permitted if the  assignment  has no
adverse effect on the Non-Assigning Party;

(b)   if the Affiliate to which the rights have been assigned ceases to be
an  Affiliate  of the  assigning  party,  the rights which have been
transferred  shall be  re-transferred  to the party which originally
assigned  those  rights or to  another  Affiliate  of that  original
assigning party; and

(c)   it  shall be a  condition  of any such  assignment  that  reasonable
notice  is  given  in  writing  to the  Non-Assigning  Party  of the
proposal to assign, (identifying the rights proposed to be assigned,
the  identity  of the  proposed  assignee  and  such  other  details
relating thereto as the Non-Assigning Party may reasonably require).

15.4  Save as  otherwise  provided in this  Agreement,  each party shall pay the
costs and expenses incurred by it in connection with the entering into and
completion of this Agreement.

15.5  This Agreement may be executed in any number of counterparts, all of which
taken together  shall  constitute one and the same agreement and any party
may enter into this Agreement by executing a counterpart.

15.6  No  amendment,  variation or waiver of this  Agreement or any provision of
this  Agreement  shall  be  effective  unless  it is in  writing  and duly
executed by or on behalf of both parties.

16.   WHOLE AGREEMENT

16.1  This Agreement (if and when executed) contains the whole agreement between
the parties relating to the transaction contemplated by this Agreement and
supersedes all previous  agreements  between the parties  relating to such
transaction.

16.2  Each of the parties to this Agreement acknowledges on its own behalf that,
in  agreeing  to enter  into  this  Agreement,  it has not  relied  on any
representation,  warranty,  collateral contract or other assurance (except
those set out in this Agreement) and waives all rights and remedies which,
but for this Clause,  might otherwise be available to it in respect of any
such  representation,  warranty,  collateral  contract or other assurance,
provided  that nothing in this Clause shall limit or exclude any liability
or fraud.

17.    NON-MERGER AND SURVIVORSHIP

Anything contained in this Agreement to which effect has not been given on
or prior to  completion  of the sale and  purchase of the Business and the
Business  Assets or which,  by its terms is capable of taking effect after
such completion or is a continuing obligation of the relevant party, shall
remain  and  continue  in  full  force  and  effect  notwithstanding  such
completion or otherwise.

18.   NOTICES

Any notice,  claim or demand requiring to be served under or in connection
with this Agreement shall be in writing and shall be sufficiently given or
served  if  delivered,  in the  case of  TEL,  to  TEL,  addressed  to its
secretary at its  registered  office and, in the case of Newco,  to Newco,
addressed to its secretary at its registered office. Any such notice shall
be  delivered  by hand or sent by fax or sent by prepaid  first class post
and if  delivered by hand or sent by fax shall  conclusively  be deemed to
have  been  given or served  at the time of  despatch  and if sent by post
shall  conclusively be deemed to have been received 48 hours from the time
of posting.

19.   GOVERNING LAW

This  Agreement  shall be governed by and  construed  in  accordance  with
English  law except in relation  to real  property  located in a territory
outside  England and Wales,  in which case the  governing law shall be the
law of that territory.  The parties  irrevocably  agree that the Courts of
England are to have  exclusive  jurisdiction  to settle any disputes which
may arise out of or in connection with this Agreement.

THIS AGREEMENT was entered into on the date stated on page 1.

SCHEDULE 1

DESCRIPTION OF THE BUSINESS

Part I - Business generally

The manufacture of titanium dioxide pigments and related  intermediate  products
(including  sulphuric  acid and  zirconia  frit),  as carried on by TEL from the
Properties but for the avoidance of doubt shall not include:-

(i)   the  manufacture  by way of  trade of any  organometallic  compounds
excepting  that  manufacture of a pigment which  incorporates  as an
essential  feature of its  composition  an  organometallic  compound
shall  not be  considered  to be  manufacture  of an  organometallic
compound as such;

(ii)  the  manufacture  (other  than for  subsequent  transfer  to Tioxide
Specialties  Limited on agreed terms) by way of trade of any form of
Ultrafine Titanium Dioxide.

Part II - Materials Business

The supply from the Properties of ferric  sulphate and copperas  manufactured as
co-products from the titanium dioxide process. The supply from the Properties of
white and red Gypsum  manufactured  as  co-products  from the  titanium  dioxide
process.

SCHEDULE 2
THE PROPERTIES

- ------------------ --------------------------------------- -----------------
PART I
- ------------------ --------------------------------------- -----------------
Address            Title No./Root of Title                 Present Use
- ------------------ --------------------------------------- -----------------
Factory at         HS40627; HS98246; (conveyance dated     Production of
Pyewipe Road       6.4.1946 and between RV Sutton's        titanium dioxide
Grimsby            Settled Estates and its Trustees (1)
and British Titan Products Company
Limited (2)
- ------------------ --------------------------------------- -----------------
Healing Cress      Conveyance dated 1.6.1971 made          Water
Beds               between British Titan Limited (1) and   extraction from
British Titan Products Company          cress beds
Limited (2)
- ------------------ --------------------------------------- -----------------
*Nettleton         Conveyance dated 01.06.78 made          Disused quarry
Bottom Quarry      between Roade Aggregates Limited (1)    -landfill of
and Appollo Site Services Limited (2)   neutralised
digester residue
- ------------------ --------------------------------------- -----------------
*Killingholme      Conveyance dated 31.12.1981 made        Drying Plant
between Glanford Borough Council (1)
and W T Scales & Son Limited (2)
- ------------------ --------------------------------------- -----------------
PART II
- ------------------ --------------------------------------- -----------------
ADDRESS            TITLE NO./ROOT OF TITLE
- ------------------ --------------------------------------- -----------------
Strip of land on   Lease dated 30.5.1989 made between      Pipeline site
the banks of the   ABP Limited (1) and Tioxide UK
River Humber       Limited (2)
- ------------------ --------------------------------------- -----------------
Gypsum Store of    Lease dated 4.9.1996 made between       Storage of
Ownby              Glentworth Bulb Co. Limited (1) and     gypsum
TEL (2)
- ------------------ --------------------------------------- -----------------

*  The  beneficial  interest in these two  Properties is owned by TEL. The legal
title to the  Property  at  Nettleton  Bottom  Quarry  is held by  Broadcount
Properties  Limited (an Affiliate of ICI) and the legal title to the Property
at Killingholme is held by WT Scales Limited (an Affiliate of ICI).

SCHEDULE 3

EXCLUDED ASSETS AND EXCLUDED LIABILITIES

(Clause 1.1)

PART I

EXCLUDED ASSETS

1.    All cash of TEL in bank and in hand and the  benefit of all bank  accounts
of TEL.

2.    Amounts due to TEL arising out of any payment  (including  overpayment) of
Taxation  and any and all  other  rights  in  respect  of or  relating  to
Taxation.

3.    Commercial and Marketing Know-How.

4.    Customer Contracts and any rights thereunder.

5.    The CO2 Liquefaction plant owned by ICI or any of its Affiliates currently
at the Properties.

6.    Any right or action to which TEL may be  entitled  (whether  in  contract,
tort or otherwise)  relating to the Excluded  Liabilities and the Excluded
Assets.

7.    Debtors.

8.    Intellectual Property relating to the Business and any rights (contractual
or otherwise) relating to Intellectual Property of the Business.

9.    Retained Business Claims.

10.   The  accounting  records  of TEL in so far as  they do not  relate  to the
Business.

11.   Subject to the provisions of Clause 10.2 any rights and benefits under the
Shared Supplier Contracts.

12.   Work-in-progress  and finished  products  owned by TEL which is located at
but has not been manufactured at any of the Properties.

13.   Any assets,  rights or benefits  relating  to the  Business  not listed in
Clause 2.1.

14.   The shares  held by TEL whilst TEL was an  Affiliate  of ICI in W T Scales
Limited, E&A West Limited, Maidgold Limited and Broadcount
Properties Limited.

PART II

EXCLUDED LIABILITIES

1     Taxation  incurred  or owing by TEL  (whether  or not due and  payable) in
respect of the Business up to the Transfer Time.

2     Liabilities relating to Customer Contracts.

3     The following matters:-

Stiller Transport claim
Personal injury claim (Mr R Hartley)

SCHEDULE 4

ALLOCATION OF CONSIDERATION TO BUSINESS ASSETS PURCHASED

(Clause 3.3)

Business Asset                      Allocation of the Final  Consideration (US$)

A.    Working Capital               (1)

B.    Materials Commercial and
Marketing Knowhow             1,000,000

C.    Land                          (2)

D.    Buildings                     (2)

E.    Plant and Equipment           (3)

F.    Other Business Assets         Nil
------------------

G.    Total Consideration           Agreed Newco Value
------------------

(1)   Actual Net Working  Capital (as defined in Schedule 14) plus agreed uplift
to Fair Market Value (US$215,000)

(2)   Net Book  Value of Land and  Buildings  as at the  Transfer  Time in TEL's
A-Forms

(3)   G - (A+B+C+D+F)

SCHEDULE 5

PROVISIONS RELATING TO THE PROPERTIES

(Clause 2.3)

PART A

Provisions relating to the Properties

1.    Subject to  Paragraph 6 below,  TEL shall on the date  hereof  complete an
assurance to Newco of each of the Freehold  Properties  and the  Leasehold
Properties  in a form  previously  approved by the parties  (each of which
shall be deemed for the  purposes of this  Agreement to be an agreement in
Agreed  Terms)  and  shall on the date  hereof  deliver  (or  procure  the
delivery of) each such  assurance or  disposition  to Newco and shall also
deliver (or procure the delivery of)  possession of each of the Properties
and  beneficial  ownership  of  each  of  the  Properties  shall  pass  on
completion of any such assurance or disposition.

2.    On the date hereof TEL shall  either  deliver (or procure the delivery of)
to Newco or hold to Newco's order the title deeds to the Properties.

3.    With effect on and from the date hereof until the Transfer Time, TEL shall
procure  that the  interest of Newco is noted on all policies of insurance
with respect to the Properties.

4.    In relation to all of the  Properties,  TEL shall be entitled to remain in
occupation,  as licensee  only,  until but not after the Transfer Time and
Newco shall make no charge in respect of the grant of any such licence.

5.    TEL shall co-operate with Newco to facilitate registration of title to any
of the  Properties  once  vested in Newco and,  without  prejudice  to the
generality of the foregoing,  shall assist in depositing any relevant land
or other  certificates or documents at H M Land Registry or other relevant
registry and in replying to any  requisitions  raised by H M Land Registry
or other relevant registry.

6.    Landlords' Consents for Leasehold Properties

6.1   Failure to Obtain Consents

6.1.1 Where a landlord's  consent is required and has not been obtained by
the date hereof in respect of any of the  Properties,  such Property
will  not,  unless  Newco so  elects  (an  "ELECTED  PROPERTY"),  be
transferred  on the date  hereof but will be held in trust for Newco
absolutely  from the date hereof  until such  landlord's  consent is
obtained  or Newco  requires  the  transfer  or  assignment  of such
Property to it in accordance  with  paragraph 6.3. TEL shall account
to and be  indemnified  by Newco  accordingly  and shall  deliver to
Newco forthwith upon receipt any notice or other document concerning
or relating to such Property or, upon request from Newco, a power of
attorney to enable Newco to deal with such Property.

6.1.2 TEL will co-operate in any reasonable arrangements proposed by Newco
designed to provide for Newco the benefits of any such Property.

6.2   Subsequent Consents

After the date hereof, TEL shall continue to use all reasonable endeavours
(assisted  if  necessary  by Newco) to obtain any  outstanding  landlord's
consent  at  Newco's  cost in  respect  of any  Property  (which is not an
Elected  Property) and keep Newco  informed of progress in obtaining  such
consents.

6.3   Notice to Transfer or Assign

Following the date hereof, Newco may serve notice on TEL at any time after
the relevant consent is obtained  requiring TEL to execute and deliver any
transfer  or  assignment  to Newco of any  such  Property  which is not an
Elected  Property and TEL will arrange for the  execution  and delivery of
such  transfer or  assignment  (together  with the  relative  documents of
title) to Newco not later than five working days after the receipt  either
of such  notice  or of the  engrossment  of such  transfer  or  assignment
whichever is the later.

6.4   Occupation by Purchaser

Newco  may at any  time  after  the  Transfer  Time go into or  remain  in
occupation of any Leasehold  Property for which necessary  consent has not
been   obtained,   as  licensee  of  TEL  and  subject  to  the  following
provisions:-

(a)   Newco  shall pay,  or  indemnify  TEL  against,  all  outgoings  and
expenses relating thereto arising after Newco's occupation begins;

(b)   Newco shall be entitled to any income thereof  arising after Newco's
occupation begins;

(c)   Newco shall  indemnify TEL against all losses,  liabilities,  Costs,
actions, proceedings, claims and demands arising from the possession
or  occupation  of such  Property  by Newco and in  particular  (but
without  limitation)  will observe and perform all the covenants and
conditions  contained or referred to in the leases relating thereto;
and

(d)   in the  event  that the  landlord  threatens  to  forfeit  the lease
relating to any  Leasehold  Property  or  forfeits  such lease Newco
shall forthwith vacate such Leasehold Property.

6.5   Terms of purchase

The Properties  are sold together with all easements,  rights and licences
appurtenant  thereto and all buildings and structures  thereon but subject
to all easements,  rentcharges,  covenants,  leases, tenancies,  licences,
agreements  and  other  matters  affecting  the  same  and  the  Leasehold
Properties  are sold subject also to the rents,  covenants and  conditions
reserved by or contained in the leases under which the same are held.

SCHEDULE 6

PROVISIONS RELATING TO THE CONTRACTS

(Clause 10.4)

1.    Newco shall with effect from the Transfer  Time carry out and complete for
its  own  account  the  Supplier  Contracts  and  the  Materials  Customer
Contracts to the extent that the same have not been  previously  performed
(whether due for  performance  prior to, on or after the  Transfer  Time).
Newco  shall  indemnify  TEL  against  all Costs,  claims and  liabilities
arising  prior  to,  on or after  the  Transfer  Time by  reason  of or in
connection  with  the   non-performance  or  the  defective  or  negligent
performance  (whether by TEL or Newco) of the  Supplier  Contracts  or the
Materials Customer Contracts.

2.    Newco shall be responsible  for and shall  indemnify TEL against any claim
from  customers  for repair,  replacement,  damage or otherwise  duly made
before or after the Transfer Time under any guarantees or warranties given
expressly or by  implication of law by TEL in respect of any goods sold or
service supplied by TEL prior to the Transfer Time in the Business.

3.    To the extent  that any  payment  is made to TEL in  respect of  Materials
Customer  Contracts after the Transfer Time, TEL shall receive the same as
trustee for Newco absolutely,  shall record such payment separately in its
books  and  shall  account  to Newco  for the  same as soon as  reasonably
practical after receipt. In determining the liability under this paragraph
of TEL to account to Newco for amounts  received,  regard  shall be had to
any  liability  of TEL to account to HM Customs  and Excise for any United
Kingdom VAT in respect of the supply of goods and/or  services (made under
any  Materials  Customer  Contract) to which such  amounts  relate and the
liability of TEL under this paragraph shall be reduced accordingly.

4.    In  determining  the  liability of Newco to reimburse  TEL for any amounts
paid by TEL to suppliers under Supplier Contracts,  regard shall be had to
the  extent to which TEL has been or is able to  recover  payment of input
tax for United Kingdom VAT purposes in respect of supplies of goods and/or
services  (under a Supplier  Contract)  made to TEL to which such  amounts
relate and the  liability of Newco under this  Agreement  shall be reduced
accordingly.

5.    If TEL has prior to the Transfer Time  sub-contracted  the  performance of
any  contracts  for the supply of goods or other  products  to any person,
Newco shall  (unless TEL would have been  entitled  under the  contract to
reject the same and Newco determines to reject the same), on behalf of the
relevant customer seek or accept delivery from such person of the goods or
other  products in respect of which such  contract was made and shall make
the same available for collection by such customer.

SCHEDULE 7

PROVISIONS RELATING TO THIRD PARTY CONSENTS

(Clause 5.4)

1.    Where  any  Business  Asset,   including  any  Materials  Business  Claim,
Materials Business Debtor, Materials Customer Contract,  Supplier Contract
and any  property  or asset  leased  by TEL  relating  exclusively  to the
Business (but excluding the Leasehold  Properties) requires the consent or
agreement of any third party for the same to be assigned or novated to or,
in the  case of any  leased  property,  to be  sub-leased  to,  Newco,  (a
"RELEVANT  BUSINESS ASSET") or any Newco Liability requires the consent or
agreement of any third party for the same to be  performed  by Newco,  and
any such consent has not been  obtained  prior to the Transfer  Time,  the
provisions of this Schedule shall apply.

2.    In  respect of any  Relevant  Business  Asset,  this  Agreement  shall not
constitute an assignment or a purported assignment thereof, or a sub-lease
or a  purported  sub-lease  thereof,  to Newco if any such  assignment  or
sub-lease  would  constitute  a  breach  of  any  agreement,  contract  or
undertaking  (a  "Relevant  Agreement")  of TEL with or to the third party
from whom any such consent as is referred to in paragraph 1 is required to
be obtained, pending such consent being obtained.

3.    TEL and Newco shall jointly use all  reasonable  endeavours  and render to
each other all reasonable  assistance (not being  financial) to obtain the
consent of such third party to an  assignment,  or novation  (whichever is
available)  or (if  neither an  assignment  or novation  is  available)  a
sub-lease of the Relevant Business Asset. During the period from and after
the  Transfer  Time until any required  consent  shall be obtained and the
Relevant Business Asset transferred,  or assigned or novated to Newco, any
such  Relevant  Business  Asset  shall be held in  trust by TEL for  Newco
absolutely  with effect from the  Transfer  Time until the same shall have
been delivered and/or formally  transferred,  assigned or novated to Newco
and TEL  shall  grant  to Newco  such  powers  of  attorney  as Newco  may
reasonably  require to enable Newco to vest in itself or otherwise to deal
with such Relevant  Business  Assets and shall deliver to Newco  forthwith
upon receipt any notice or other  document  containing or relating to such
Relevant Business Assets.

4.    This  Agreement   shall  not  constitute  an  assumption  or  a  purported
assumption of any Newco Liability in respect of which performance  thereof
by Newco would require the consent or agreement of any third party if such
assumption  or  purported  assumption  would  constitute  a breach  of any
Relevant Agreement  pursuant to which the obligation arises.  Newco shall,
to the  extent  that the same  would not  result in any breach of any such
Relevant Agreement perform as TEL's  sub-contractor all the obligations of
TEL  thereunder and indemnify TEL against all  liabilities  (and all Costs
reasonably incurred by TEL) arising in connection therewith.

5.    Where  the  performance  by  Newco  of any  Relevant  Agreement  as  TEL's
sub-contractor  would  result in a breach of any  agreement,  contract  or
undertaking  with a third party (whether  under the Relevant  Agreement in
respect of which the obligation  arises or under any other  agreement with
any other person relevant to the  performance of such Relevant  Agreement)
Newco shall not perform such obligations as TEL's  sub-contractor  but TEL
shall continue to perform such obligations on behalf of and at the risk of
Newco and Newco agrees to indemnify TEL against all  liabilities  (and all
Costs reasonably incurred by TEL) arising in connection therewith.

6.    TEL agrees and acknowledges  that,  insofar as any Relevant Business Asset
is  expressed  in  this  Schedule  to be held on  trust  by TEL for  Newco
absolutely,  any  monies  received  by TEL in  respect  thereof  shall  be
accounted for by TEL to Newco and any profit arising out of the conduct of
the Business  utilising any such Business  Asset shall accrue to Newco and
TEL agrees to pay forthwith to Newco any such  amounts,  less in each case
an amount equal to the relevant Costs which TEL is entitled to recover and
deduct from any such payment.

7.    Newco expressly  acknowledges  that insofar as any Newco Liability has not
been effectively  assumed by Newco and, insofar as the same relates to the
performance  of any  obligations  under any  Relevant  Agreement  and such
obligations  are,  pursuant  to the  provisions  of this  Schedule,  to be
performed by Newco as TEL's  sub-contractor  or by TEL on behalf of Newco,
such  performance  is at the risk and cost of Newco and any loss and costs
in relation  thereto  shall be offset  against any amounts to be accounted
for to Newco  pursuant to paragraph 6. To the extent that any loss or Cost
exceeds any such amount to be accounted for to Newco pursuant to paragraph
6, Newco shall  indemnify  TEL against or reimburse TEL for any payment in
respect thereof.

8.    Insofar as the provisions of this Schedule  provide for TEL to perform any
Relevant  Agreement or otherwise  assume any  obligation,  Newco agrees to
lease or licence  (so far as Newco is able to grant the same) to TEL,  for
the period  during  which any such  obligation  exists as provided in this
Schedule, any Business Assets acquired by Newco pursuant to this Agreement
and necessary for the purposes of such performance.  The consideration for
any  such  lease  or  licence  shall be TEL's  agreement  to  perform  any
obligations  expressed to be performed by it in this Schedule in favour of
and for the  account of Newco for any monies or  profits as  described  in
paragraph  6 above  and so  that  TEL  shall  not be  required  to pay any
additional amount in respect thereof.

9.    Newco agrees to make  available  to TEL the  services of any  Transferring
Employees or any Offer  Employees to enable TEL to perform any obligations
expressed to be performed by it in this  Schedule:  PROVIDED that any such
employees  shall continue to be employees of Newco and Newco shall perform
and observe all the  obligations  of the employer  under or in  connection
with the  contracts  of  employment  of such  persons  (including  without
limitation  holiday  entitlement  and pay) and Newco shall  indemnify  TEL
against or  reimburse  TEL for any payment  required to be made or made by
TEL to any such Transferring Employees or Offer Employees.

10.   Upon any such consent as is referred to in paragraph 1 being obtained,  as
a result of which any  assignment,  sub-lease or any other transfer of the
benefit of any Relevant Business Asset to Newco or the assumption by Newco
of any Newco  Liability  would  not  constitute  a breach of any  Relevant
Agreement  of TEL with or to the third party from whom any such consent is
obtained, such Relevant Business Asset shall pursuant to this paragraph be
assigned,  sub-leased or the benefit thereof otherwise vested in Newco, or
Newco shall assume the Newco Liability, as the case may be on the terms of
this Agreement and:-

10.1  any lease or licence for any  Business  Assets  referred to in paragraph 8
shall thereupon automatically terminate; and

10.2  insofar as the services of any  Transferring  Employees or Offer Employees
have been made  available to TEL as provided in paragraph 9 in  connection
with  such  Relevant   Business  Asset,   such  services  shall  thereupon
automatically  cease to be made  available in any case,  without  Costs to
TEL, and the provisions of this Schedule shall cease to apply with respect
thereto.

11.   Without prejudice to the generality of the foregoing,  TEL shall,  without
incurring any Cost,  take such actions as Newco may reasonably  request to
procure that suppliers  under the Supplier  Contracts and customers  under
the  Materials   Customer   Contracts   unconditionally   consent  to  the
substitution  of Newco as a party  thereto  with effect from the  Transfer
Time but,  in any case where such  consent  is  refused or  otherwise  not
obtained, prior thereto:-

11.1  TEL shall  receive any goods  delivered to it by the supplier as agent for
Newco and at Newco's  cost,  taking  reasonable  care,  shall deliver such
goods to such address of Newco as Newco may specify; and

11.2  Newco shall put TEL in funds to enable TEL to pay in due time the supplier
in respect thereof.

12.   If, on or before 6 weeks after the  Transfer  Time,  or such later date as
TEL and Newco may agree,  any  consent  or  agreement  of any third  party
referred to in paragraph 1 has not been  obtained or if, at any time,  the
benefit  of any  Relevant  Business  Asset  cannot  be  vested in Newco or
otherwise  dealt with by Newco,  TEL and Newco shall consider what action,
if any, is to be taken in relation to the Relevant Business Asset.

13.   TEL shall not be obliged to take any action pursuant to this Schedule 7 if
such action  could not be lawfully  undertaken  by TEL, or would result in
any breach of any  agreement  to which TEL is a party which  breach  would
entitle the other  party  thereto to  terminate  such  agreement  or would
result in TEL incurring any Costs of a material amount against which Newco
has not agreed to indemnify it pursuant to this Agreement or otherwise. In
so far as,  pursuant  to this  Agreement,  TEL is a trustee of, or acts as
agent  for  Newco,  TEL  shall  act  with  such  care  and  skill as might
reasonably  have  been  expected  of TEL in the  conduct  of the  Business
assuming the sale and  purchase of the  Business  and the Business  Assets
pursuant to this Agreement had not occurred but,  subject  thereto,  shall
not have any duties or  responsibility to Newco in respect of so acting or
have any  liability  to Newco  except to the  extent  that it is guilty of
wilful  default  or of  acting  otherwise  than  with the  care and  skill
referred to in this paragraph.

SCHEDULE 8

NOTIFICATION, ASSISTANCE AND PROCEEDINGS

(Clauses 6, 7 and 8)

1.    NOTIFICATION

TEL shall  notify  Newco and Newco shall notify TEL, in either case if the
notifying  party  reasonably  considers  the  subject  matter  thereof  to
represent a potentially significant right or liability of the other party,
promptly of receipt of any information,  in whatever form, relating to any
Debtor,  Materials  Business Debtor,  Retained  Business Claim,  Materials
Business  Claim,  Newco Liability or TEL Liability and shall supply copies
of all such  information so received on request.  Either party may enquire
of the other party if it has received any information  referred to in this
paragraph and may request  further  details in respect  thereof  including
copies  of any  materials  in  respect  thereof.  Such  notification  will
describe the information received with sufficient  particularity to enable
the  recipient  to assess its  significance  in relation  to such  Debtor,
Materials  Business Debtor,  Retained Business Claim,  Materials  Business
Claim, Newco Liability or TEL Liability.

2.    ASSISTANCE

2.1   TEL will promptly give or procure that there is given all such information
and assistance as Newco shall reasonably  require (including access to any
books,  correspondence or other documents or records and the right to copy
the same and to any witnesses or potential  witnesses or officials of TEL)
for the purpose of:-

2.1.1 recovering  any  amount  due in  respect  of,  or  compromising  any
Materials  Business Debtor or Materials  Business Claim or avoiding,
disputing,  resisting,  appealing,  compromising,  or contesting any
related counter-claim; or

2.1.2 avoiding,   disputing,   resisting,   appealing,   compromising,  or
contesting any Newco Liability.

2.2   Newco shall indemnify the relevant member of TEL's Group against all Costs
and liabilities which it may incur in complying with paragraph 2.1.

2.3   Newco  will  promptly  give or  procure  that  there  is  given  all  such
information  and  assistance as TEL shall  reasonably  require  (including
access to any books,  correspondence or other documents or records and the
right to copy the same and to any  witnesses  or  potential  witnesses  or
officials of Newco) for the purpose of:-

2.3.1 recovering any amount due in respect of, or compromising  any Debtor
or  Retained  Business  Claim  or  avoiding,  disputing,  resisting,
appealing, compromising, or contesting any related counter-claim; or

2.3.2 avoiding,   disputing,   resisting,   appealing,   compromising,  or
contesting any TEL Liability.

2.4   TEL shall indemnify  Newco against all Costs and  liabilities  that it may
incur in complying with paragraph 2.3.

2.5   Each of the parties  agrees to keep the other informed (to the extent that
party reasonably believes the other party has an interest therein which is
not insignificant or as reasonably requested by the other party) as to the
progress of any Materials  Business Claim or Retained Business Claim or of
any  claim,  demand or action in  respect  of any Newco  Liability  or TEL
Liability.

3.    CONDUCT OF DISPUTES

3.1   This  paragraph  applies  as to the  conduct  of any  claim  made  by,  or
proceedings  instituted or threatened by, any third party,  whether before
or after the date hereof (including any counter-claim)  ("PROCEEDINGS") in
relation to any  Debtor,  Materials  Business  Debtor,  Retained  Business
Claim,  Materials  Business Claim, Newco Liability or TEL Liability by the
party  (the  "CONDUCTING  PARTY")  specified  by this  Agreement  as being
entitled to conduct  such  Proceedings.  In any case where this  Agreement
does  not  specify  which  of  the  parties  is to  have  the  conduct  of
Proceedings in any particular case,  including in circumstances  where the
potential  responsibility for any liability the subject of any Proceedings
has not been  allocated  between the parties,  the party  against whom the
claim has been made, or proceedings  instituted or threatened,  shall have
conduct of the Proceedings, or, if the claim has been made, or proceedings
instituted or threatened, against both parties, TEL shall have the conduct
of the  Proceedings  and, in either case,  accordingly  be the  Conducting
Party in respect thereof for the purposes hereof.

3.2   The  Conducting  Party  shall  inform the party not having  conduct of the
Proceedings (the "OTHER PARTY") promptly of all developments regarding the
Proceedings,  shall consult it and have reasonable regard to its interests
before  taking any  significant  step in relation to the  Proceedings  and
shall not settle the  Proceedings  without the consent of the Other Party,
such consent not to be  unreasonably  withheld or delayed.  The Conducting
Party  shall  conduct  any  Proceedings  with  reasonable   diligence  and
competence.  The  Other  Party  shall  render  all  assistance  reasonably
required in connection with the Proceedings by the Conducting  Party,  and
shall be  entitled  to payment in respect of that  assistance  only in the
event that the  assistance it renders is  significantly  greater in extent
than that provided by the Conducting Party.

3.3   The Conducting Party may instruct legal advisers  reasonably  satisfactory
to the Other  Party to  represent  any  member of the Other  Party (or any
member of the Other  Party's  Group in the case of TEL which is a party to
the Proceedings:  PROVIDED that in any Proceedings where the named parties
to any such  Proceedings  (including any added  parties)  include both the
Conducting  Party (or any  member of its Group in the case of TEL) and the
Other  Party  (or  any  member  of its  Group  in the  case  of  TEL)  and
representation  of both parties by the same legal  advisers  would not, in
the opinion of the legal advisers  appointed by the Conducting  Party,  be
proper due to actual or potential  conflict of interest  between them, the
Conducting  Party  shall  instruct  separate  legal  advisers   reasonably
satisfactory  to the Other Party to represent the Other Party (and members
of its Group) in such  Proceedings and the Conducting  Party shall pay the
fees and disbursements of such legal advisers.

SCHEDULE 9

SUPPLIER CONTRACTS OF A MATERIAL NATURE

(Clause 1.1)

[Details to follow]

SCHEDULE 10

DOCUMENTS IN THE AGREED TERMS

(Clause 1.1)

Newco Patent and Know-how Licence

SCHEDULE 11

EMPLOYEES AND OTHER PERSONNEL

(Clause 9)

1.    Newco undertakes to TEL that it will,  insofar as it has not done so prior
to the date hereof:-

1.1   deliver to each of the Transferring  Employees,  a letter  confirming that
the employee will  transfer  employment to Newco by reason of the transfer
of the Business; and

1.2   deliver to each Offer Employee,  a letter  offering  employment with Newco
with  effect  from the  Transfer  Time on their  terms and  conditions  of
employment  immediately  prior  to the  Transfer  Time  (other  than as to
employer).

2.    The parties  acknowledge  and agree that the sale of the Business from TEL
to Newco is a  "relevant  transfer"  within the  meaning  of the  Transfer
Regulations.

3.    The parties  further  acknowledge  and agree that pursuant to the Transfer
Regulations,  the  contract  of  employment  of each  of the  Transferring
Employees  (save  insofar  as  such  contract   relates   to/includes  any
occupational pension scheme as defined for the purposes of Regulation 7 of
the Transfer  Regulations)  shall be transferred to Newco with effect from
the Transfer Time which shall be the "time of transfer" under the Transfer
Regulations.

4.    As from the  Transfer  Time,  Newco  shall  perform  and  observe  all the
obligations of the employer  under or in connection  with the contracts of
employment  of  the   Transferring   Employees  and  the  Offer  Employees
(including without limitation accrued holiday pay, holiday entitlement and
pay) and shall  indemnify TEL and keep TEL  indemnified,  against each and
every  action,  proceeding,  liability,  Costs,  claim,  or loss or demand
arising from Newco's failure to perform and observe the said obligations.

5.    Notwithstanding  any  other  provision  in  this  Agreement,  Newco  shall
indemnify TEL and keep TEL indemnified  against all actions,  proceedings,
liabilities, Costs, claims, losses, and demands made by or arising from:-

5.1   any  Transferring   Employees  and  the  Offer  Employees  in  respect  of
employment on or prior to the Transfer Time;

5.2   the dismissal (whether express, constructive or otherwise) of any employee
in connection with the transfer of the Business to Newco;

5.3   any change in the working  conditions  of the  Transferring  Employees  or
Offer Employees or any of them occurring after the Transfer Time;

5.4   the change of employer  occurring  by virtue of the  Transfer  Regulations
and/or this Agreement;

5.5   the  employment  by  Newco  on or after  the  Transfer  Time of any of the
Transferring  Employees or Offer Employees other than on terms  (including
terms  relating to any  occupational  pension  scheme) at least as good as
those enjoyed immediately prior to the Transfer Time or the termination of
the employment of any of them on or after the Transfer Time;

5.6   any claim by any  Transferring  Employee  or Offer  Employee  (whether  in
contract or in tort or under statute (including the Treaty of Rome and any
directives  made  under the  authority  of that  Treaty))  for any  remedy
including, without limitation, in respect of unfair dismissal, redundancy,
equal pay, sex, race or disability discrimination; or

5.7   any  claim  by any  employee  representatives,  trade  union  or  affected
employee that there has been a failure to comply with any  requirement  of
Regulation  10 of the Transfer  Regulations,  any failure to inform and/or
consult  employees  imposed by any  collective  agreement,  European Works
Council Agreement or other employee representative agreement.

6.    Newco  shall,  as from the  Transfer  Time,  perform  and  observe all the
obligations  of TEL as  employer,  or host  (where the  employee  has been
seconded to TEL but is not employed by TEL) under or in connection with:-

6.1   the contracts of employment of the Offer Employees; or

6.2   any contract relating to their secondment to TEL; or

6.3   any undertaking (whether legally binding or not) to employ any such person
after a period of absence  (whether by reason of maternity,  career break,
education,  training or otherwise) and Newco shall  indemnify TEL and keep
TEL  indemnified  against each and every  action,  proceeding,  liability,
Costs,  claim,  loss, and demands  arising from Newco's failure to perform
and observe such obligations or undertakings.

In accordance with its obligations under the Transfer  Regulations,  Newco
shall  provide TEL in writing  with such  information  and at such time as
will  enable  TEL to  carry  out its  duties  under  Regulation  10 of the
Transfer Regulations concerning measures envisaged by Newco in relation to
the Transferring Employees or the Offer Employees.

7.    Newco shall be entitled at its own expense in its absolute  discretion  to
take such action as Newco shall deem  necessary or desirable to prosecute,
settle or  compromise  any claims  of, or  proceedings  instituted  by any
Transferring  Employee or any other  person,  whether  before or after the
date hereof,  in respect of the matters  expressed in this  Schedule to be
obligations  of Newco or in respect of which Newco has agreed to indemnify
TEL as  provided  herein  and  shall  have  the  conduct  of  any  related
proceedings, negotiations or appeals in accordance with Schedule 8.

8.    Any  reference  in this  Schedule to contract of  employment,  employer or
employee shall, unless the context otherwise requires, include contract of
training  and  contract  of  apprenticeship,   trainer,  and  trainee  and
apprentice, respectively.

9.    Newco agrees that for a period of four years from the Transfer Time:

9.1   the  Transferring  Employees  and Offer  Employees  will receive and enjoy
contractual  remuneration  and benefits  (including  retirement  benefits)
which,  judged  objectively  are no less  favourable  overall  than  their
contractual remuneration and benefits at the Transfer Time;

9.2   it will not make any unilateral  material change to the contractual  terms
and conditions of employment of the  Transferring  Employees and the Offer
Employees,  (which includes those terms contained in a letter to employees
dated 19 June 1991 from TEL) without prior  consultation where required by
any local laws or agreements  with  recognised  trade unions,  appropriate
employee   representatives   or  the  Transferring   Employees  and  Offer
Employees.

SCHEDULE 12

SHARED SUPPLIER CONTRACTS

Contract for the supply of ilmenite  between (1) Tioxide  Group plc as agent for
Tioxide UK Ltd,  Tioxide  Australia  Ltd and  Tioxide  Espana SA (2)  Westralian
Sands.

SCHEDULE 13

TRANSFERRING EMPLOYEES

[Details to follow]

OFFER EMPLOYEES

[Details to follow of those  employees  currently  located at Billingham site in
connection with the Materials Business who are to relocate to Grimsby.]

SCHEDULE 14

ESTIMATED CONSIDERATION, FINAL CONSIDERATION AND FINAL
COMPLETION STATEMENT

1.    INTERPRETATION

1.1   In this Schedule:-

"A FORM"                means in relation to Newco, a financial
report prepared in the format set forth in
Annex 2 and in accordance with the
accounting policies, practices and other
requirements set out or referred to in ICI's
Controller's Manual and prepared as at the
Newco Completion Date on a basis consistent
with that adopted by TEL for the preparation
of A Forms prior to the Transfer Time;

"ACTUAL NET WORKING     means the Net Working Capital as at the Newco
CAPITAL"                Completion Date as determined under
paragraphs 1.6 to 1.8 below;

"ICI'S AUDITORS"        means KPMG Audit Plc of 8 Salisbury Square,
London, EC4Y 8BB;

"ICI'S CONTROLLER'S     means the control manuals in effect as at 14
MANUALS"               July 1997 and which are compiled in accordance
with UK GAAP used for accounting purposes
within the ICI Group and which are recorded
on disk form as attached and identified as
Annex 3 to this Agreement (and which
consists of an introduction to the Group
Controller's Manual, Bulletin Board,
Accounting Language, Bulletin Board
Reporting, Accounting Definitions and
Conventions, Accounting Policies and
Procedures, Controls, Reporting);

"INTEREST RATE"         means LIBOR plus 25 basis points;

"NET WORKING CAPITAL"   means:-

(a) Operating Debtors;  plus
(b) Stocks;  less
(c) Operating Creditors less than 1 year;

For the purposes of (b) the Stocks shall be valued
in   accordance    with   the   document    headed
"Stocktaking  and  Valuation  Principles"  in  the
Agreed Terms marked "NWC-S"

"NEWCO'S AUDITORS"      means [                                   ];

"NEWCO COMPLETION DATE" means immediately after completion of this
Agreement;

"OPERATING CREDITORS    means, in relation to Newco, the absolute
LESS THAN 1 YEAR"       value of the  amount reported as
creditors of Newco which  are   external   to
Newco  as  defined  by reference  to
"operating  creditors  less  than 1
year" on line  70020  of the A Form  for  Newco as
described in ICI's Controller's
Manuals;

"OPERATING DEBTORS"     means,  in relation to Newco,  debtors of
Newco  which are  external  to Newco as defined by
reference to "operating  debtors" on line 70010 on
the  A  Form  for  Newco  as  described  in  ICI's
Controller's Manuals;

"STOCKS"                means the stock of fuels, raw materials, raw
materials, ingredients, packaging, office
and laboratory supplies, revenue engineering
spares, consumable stores, work in progress
and finished goods owned by Newco as
determined on line 70000 of the A Form for
Newco;

"UK GAAP"               means generally accepted accounting
principles in the United Kingdom.

1.2   References  to the  absolute  value of a number  X shall be  construed  as
follows:

1.2.1 if X is greater than or equal to zero, the absolute value of X shall
be equal to X; and

1.2.2 if X is  less  than  zero,  the  absolute  value  of  X  shall  be X
multiplied by -1

so that,  for the purposes of  illustration,  the  absolute  value of 1 is
equal to 1 and the absolute value of -1 is equal to 1.

1.3   The  definitions  used in this Schedule  relate only to this Schedule and,
unless  expressly  stated to the  contrary,  shall  have no bearing on the
interpretation of any other agreement entered into by TEL, Newco and their
respective Affiliates.

1.4   All  payments and values  under this  Schedule  shall be in US Dollars and
where  an  amount  is not  itself  calculated  in US  Dollars  it shall be
converted  into US  Dollars  at the mid market  closing  exchange  rate in
London for the currency in which that amount is expressed  into US Dollars
as published in the London Edition of the Financial  Times first published
thereafter,  or where the  exchange  rate is not  published  in the London
Edition of The  Financial  Times,  at the exchange rate quoted by Citibank
N.A. as at the close of business in London for the  currency in which that
amount is expressed on the Newco Completion Date in relation to amounts in
the Final Completion Statement.

1.5   CALCULATION OF THE FINAL CONSIDERATION

In relation to this Agreement:

1.5.1 the  Final   Consideration  for  the  Business  Assets  ("THE  FINAL
CONSIDERATION") shall be determined by the following formula:-

Final  Consideration = US$  118,410,000  minus [U.S. $ EQUIVALENT OF
GBP3,950,000 (REPRESENTING THE NET WORKING CAPITAL AS AT 28 FEBRUARY
1998) CONVERTED INTO U.S. $ IN ACCORDANCE WITH PARAGRAPH 1.4 OF THIS
SCHEDULE] plus Actual Net Working Capital.

1.5.2 After  the Newco  Completion  Date TEL  shall  prepare a  completion
statement  as at the Newco  Completion  Date which  shall  contain a
statement of the Final  Consideration  in accordance  with paragraph
1.5.1 above and a schedule of the Actual Net Working  Capital  based
on TEL's calculations (the "FINAL COMPLETION STATEMENT").  The Final
Completion Statement shall be prepared using ICI's normal accounting
policies  and   practices  as  set  out  or  referred  to  in  ICI's
Controller's Manuals and prepared as at the Newco Completion Date on
a basis consistent with that adopted by TEL for the preparation of A
Forms prior to the  Hivedown  and shall be submitted by TEL to ICI's
Auditors for review.

1.6   Within 50 days of the Newco  Completion  Date,  TEL shall  issue the Final
Completion  Statement to Newco  together  with a copy of a report by ICI's
Auditors addressed to TEL and substantially in the form set out in Annex 4
to the effect that the Final  Completion  Statement  has been  prepared in
accordance  with this  Schedule.  Although it is TEL's  responsibility  to
prepare the Final Completion Statement, TEL will require the assistance of
the employees of Newco and its  Affiliates  to fulfil this  responsibility
and Newco shall  ensure such  assistance  is provided  promptly  and at no
charge.  Immediately  after  delivery of the Final  Completion  Statement,
Newco's  Auditors  shall  have the  right to review  the Final  Completion
Statement  and  ICI's  Auditors  working  papers  relating  to  the  Final
Completion  Statement.  Within 30 days of  delivery  to Newco of the Final
Completion  Statement and ICI's Auditors report (each of which shall be in
English) to Newco's designated location, Newco shall give notice to TEL in
writing of any item or items in the Final  Completion  Statement  which it
wishes to dispute  and the basis on which it  disputes  that item or those
items  and the  changes  to the Final  Completion  Statement  which  Newco
believes  should  be made  and the  parties  shall  use  their  reasonable
endeavours  to resolve that  dispute.  Any items in respect of which Newco
does not give such notice  will be deemed to have been  accepted by Newco.
Any written  resolution  reached by the parties on any disputed item shall
be final, conclusive and binding on the parties.

1.7   If the parties  agree the Final  Completion  Statement  then any adjusting
payments  referred to in  paragraph  1.9 below shall be made by the paying
party within 7 days of being agreed by the parties.

1.8   If the  parties  fail to  agree on any  element  of the  Final  Completion
Statement within 24 days after Newco has given notice in writing to TEL of
any  item(s)  in the Final  Completion  Statement  which  Newco  wishes to
dispute (in  accordance  with paragraph 1.6 above) then any agreed amounts
shall be paid in accordance  with the preceding  paragraph and any dispute
may be referred by either party for final determination in accordance with
Clause 14 of this Agreement and any amounts  thereby found to be due shall
be paid by the  relevant  party not later  than 7 days  after  such  final
determination.

1.9   When  the  Final  Consideration  is  agreed  or  otherwise  determined  in
accordance  with the three  preceding  paragraphs the following  adjusting
payments shall be made:-

1.9.1 an  amount  equal  to  the  difference  between  (i)  the  Estimated
Consideration   (namely   US$   118,410,000)   and  (ii)  the  Final
Consideration; and

1.9.2 interest  (compounded monthly) at the Interest Rate on the amount in
paragraph 1.9.1 above from the Newco  Completion Date to the date of
payment, calculated on a day to day basis;

which  shall  be  paid  by TEL to  Newco  (or  vice  versa,  if the  Final
Consideration exceeds the Estimated Consideration).

1.10  In this  Schedule,  references to lines of A-Forms have been chosen by TEL
and are believed in good faith to  correspond to the matters to which they
refer.  If,  however,  that  reference  when  compared  to the  matter  it
describes or refers to is incorrect  then there shall be  substituted  for
that line reference  another line reference (if any) which  corresponds to
the matter described or referred to.

SIGNED by [                  ]
for and on behalf of
TIOXIDE EUROPE LIMITED in the presence of:

SIGNED by [                  ]
for and on behalf of
NEWCO LIMITED
in the presence of:

EXHIBIT 10.4

DATED                                   1998

TIOXIDE EUROPE LIMITED

and

N L INDUSTRIES, INC.

SHARE SALE AND PURCHASE AGREEMENT
OF
NEWCO

THIS AGREEMENT is made on                1998  BETWEEN:

(1) TIOXIDE  EUROPE  LIMITED  (registered  number  832447),  a company
incorporated under the laws of England, whose registered office is
at 137-143 Hammersmith Road, London W14 0QL (the "SELLER");

(2) N L INDUSTRIES, INC., a corporation incorporated under the laws of
the State of New Jersey,  whose  principal place of business is at
16825 Northchase Drive, Suite 1200, Houston, Texas 77060, USA (the
"PURCHASER").

WHEREAS:

(A) [ ] Limited is a company registered in England,  short particulars
of which are set out in Schedule 1 (the "COMPANY").

(B) The  Seller  holds  shares  in the  Company  (the  "SALE  SHARES")
particulars  of which are  contained in Schedule 1.

(C) The  Seller  has  agreed to sell and the  Purchaser  has agreed to
purchase the Sale Shares on the terms set out in this agreement.

IT IS AGREED as follows:

1  INTERPRETATION

1.1  In this agreement:

"ACT" means the Companies Act 1985;

"ACTUAL  NET WORKING  CAPITAL"  has the  meaning  ascribed  thereto in
Schedule 4 of the Hivedown Agreement;

"AFFILIATES"  means with respect to a specified entity, an entity that
directly or indirectly, through one or more intermediaries,  Controls,
or is  Controlled  by,  or is under  common  Control  with the  entity
specified,  provided  that,  without  limiting the  generality  of the
foregoing, in relation to the Seller and its subsidiary companies, the
term "Affiliates"  shall not include any entity in which a party has a
fifty per cent. or less ownership  interest.  For the purposes hereof,
"CONTROL" means  possession,  directly or indirectly,  of the power to
direct or cause the direction of the management and operating policies
of the  entity in respect of which the  determination  is being  made,
through the ownership of voting securities,  contract, voting trust or
otherwise but any  reference in this  agreement to an Affiliate of the
Seller or the Purchaser  shall exclude the Company,  and references to
the  Seller's  Group  or the  Purchaser's  Group  shall  be  construed
accordingly;

"AGREED  FORM" means,  in relation to any  document,  the form of that
document which has been  initialled for the purpose of  identification
by the parties to this agreement;

"BUSINESS  DAY" means a day (other than a Saturday or Sunday) on which
banks are  generally  open for normal  business in both London and New
York;

"CAP" has the meaning set forth in sub-Clause 5.6;

"CLAIM"  means any claim  (other than in respect of  Taxation)  by the
Purchaser  for breach of the  Warranties or under the  indemnities  or
under  any  other  provision  of this  agreement  or under  any of the
Implementation  Agreements for which the Seller  accepts  liability or
shall be adjudicated as being liable;

"COMPLETION"  means  completion  of the sale and  purchase of the Sale
Shares in  accordance  with  Clause 7 which  shall  occur  immediately
following signature and exchange of this agreement;

"COMPLETION  DATE" means  immediately after completion of the Hivedown
Agreement;

"COMPUTER  SYSTEMS"  means  all  computer  hardware,  software,  micro
processors  and  firmware  which in each case are used in the  Grimsby
Business;

"DEFAULT  INTEREST"  means  LIBOR  plus 200  basis  points  compounded
monthly;

"ENVIRONMENT" has the meaning given in Schedule 6;

"ENVIRONMENTAL  AUTHORISATIONS"  means all or any  permits,  consents,
licences,   approvals   and  other   authorisations   required   under
Environmental Laws and all terms and conditions thereof required under
any  Environmental  Law  for  the  operation  of the  business  of the
Company;

"ENVIRONMENTAL LAWS" has the meaning given in Schedule 6;

"ESTIMATED  HIVEDOWN   CONSIDERATION"  has  the  meaning  ascribed  to
Estimated Consideration in the Hivedown Agreement;

"ESTIMATED  NEWCO HIVEDOWN DEBT" has the meaning  ascribed  thereto in
sub-Clause 3.1.1 of the Hivedown Agreement;

"EXCLUDED ASSETS" means the carbon dioxide liquefaction plant owned by
ICI or its relevant Affiliate(s) and currently at the Grimsby Site;

"FINAL  HIVEDOWN  CONSIDERATION"  has the  meaning  ascribed  to Final
Consideration in the Hivedown Agreement;

"GRIMSBY  ASSETS" has the meaning  ascribed to Business  Assets in the
Hivedown Agreement but excluding the Excluded Assets;

"GRIMSBY  BUSINESS"  means  the  business  purchased  by  the  Company
pursuant to the Hivedown Agreement;

"GRIMSBY  BUSINESS DATA" has the meaning  ascribed to Business Data in
the Hivedown Agreement;

"GRIMSBY  CONTRACTS"  has the  meaning  ascribed to  Contracts  in the
Hivedown Agreement;

"GRIMSBY  DISCLOSURE LETTER" means the letter of the same date as this
agreement from the Seller to the Purchaser;

"GRIMSBY EMPLOYEES" has the meaning ascribed to Transferring Employees
and Offer Employees in the Hivedown Agreement;

"GRIMSBY  FINANCIAL   INFORMATION"  means  the  financial  information
attached as Schedule 8;

"GRIMSBY  PROPERTIES"  has the meaning  ascribed to  Properties in the
Hivedown Agreement;

"GRIMSBY SITE" means the property  short  particulars of which are set
out  in the  table  contained  in  Schedule  2 Part I of the  Hivedown
Agreement;

"GRIMSBY  STOCKS" has the meaning  ascribed to  Stock-in-Trade  in the
Hivedown Agreement;

"HIVEDOWN  AGREEMENT"  means the  agreement  of even date  between the
Seller  and the  Company  relating  to the  sale and  purchase  of the
Grimsby Business;

"ICI" means Imperial Chemical Industries PLC;

"ICI'S CONTROLLER'S MANUALS" means the control manuals in existence at
14 July 1997 and which are  compiled in  accordance  with UK GAAP used
for  accounting  purposes  within the ICI Group,  copies of which have
been received by the Purchaser  (and which consist of an  introduction
to  the  Group  Controller's   Manual  Bulletin  Board  of  Accounting
Language,   Bulletin  Board  Reporting,   Accounting  Definitions  and
Conventions, Accounting Policies and Procedures, Controls, Reporting);

"ICI GROUP" means ICI and its Affiliates as at the Completion Date;

"IMPLEMENTATION AGREEMENTS" means the documents listed in Schedule 5;

"INTELLECTUAL PROPERTY" means all patents, trademarks,  service marks,
registered   designs,   copyrights,   and  rights  to  inventions  and
applications  for and rights to apply for protection or  registrations
of any of the same including any continuing,  reissue,  divisional and
re-examination patent applications and Technical Information;

"LIBOR"  means the rate for deposits in US Dollars for a period of one
month  which  appears on the  Reuters  Screen ISDA Page (or such other
page as the parties  may agree) at  approximately  11.00 a.m.,  London
time,  on the first day of the  period  to which any  interest  period
relates  (the  "RELEVANT  DATE").  If such rate does not appear on the
Reuters  Screen  ISDA  Page on the  Relevant  Date,  the rate for that
Relevant Date will be determined as if the parties had specified  that
the rate for the Relevant  Date will be determined on the basis of the
rates at which  deposits in US Dollars are offered by Midland Bank plc
at  approximately  11.00 a.m.,  London time,  on the Relevant  Date to
prime banks in the London  interbank  market for a period of one month
commencing on that Relevant Date for amounts of US$10,000,000;

"MATERIAL GRIMSBY  CONTRACTS" means all Grimsby Contracts (i) which at
Completion  have in  excess of 12 months to run and which in that time
can reasonably be expected to involve income or expenditure in respect
of the Grimsby  Business in excess of  US$200,000  per annum;  or (ii)
which at Completion  have less than 12 months to run and which in that
time can  reasonably be expected to involve  income or  expenditure in
respect of the Grimsby  Business in excess of  US$1,000,000;  or (iii)
which relate to the treatment  and/or disposal of waste; or (iv) which
relate to contract  manufacturing  or  processing of products by third
parties;  and/or (v) relating to third party distribution or agency in
respect of products;

"PARENT  UNDERTAKING"  shall have the meaning  given in section 258 of
the Companies Act 1985;

"PERMITS" means all licences, permits,  authorisations,  registrations
and approvals issued or granted by statutory or local  authorities for
the purposes of operation of the Grimsby Business (but excluding,  for
the  avoidance  of doubt,  planning  permissions  issued  by  relevant
planning  authorities (save for Environmental  Authorisations) and any
licence,  permit,  authorisation  or approval  which falls  within the
Regulatory Conditions);

"PLANT AND EQUIPMENT" has the meaning  ascribed to Plant and Equipment
in the Hivedown Agreement;

"PURCHASER'S AUDITORS" means PricewaterhouseCoopers;

"PURCHASER'S GROUP" means the Purchaser's  ultimate parent undertaking
and that parent undertaking's Affiliates;

"REGULATORY  CONDITIONS" means the anti-trust or regulatory  approvals
necessary  to complete the sale of the Company on the terms set out in
this agreement;

"QUALIFYING AMOUNT" has the meaning set forth in sub-Clause 5.5.1;

"QUALIFYING CLAIM" has the meaning set forth in sub-Clause 5.5;

"SCHEME" means the Tioxide Pension Fund;

"SELLER'S AUDITORS" means  PricewaterhouseCoopers  of 32 London Bridge
Road, London SE1 9QL;

"SELLER'S  GROUP" means the Seller's  ultimate parent  undertaking and
that parent undertaking's Affiliates as at the Completion Date;

"TAXATION" means:

(a)  any tax, duty,  impost or levy,  past or present,  of
the   United    Kingdom   or    elsewhere,    whether
governmental,  state, provincial,  local governmental
or municipal, including but not limited to income tax
(including  income tax  required  to be  deducted  or
withheld  from or  accounted  for in  respect  of any
payment  under  Section  203  of the  United  Kingdom
Income and Corporation  Taxes Act 1988 or otherwise),
corporation  tax,  advance  corporation  tax, capital
gains tax, value added tax,  customs and other import
or export duties, stamp duty, stamp duty reserve tax,
national insurance and social security  contributions
but  excluding  rates,  council  tax or  any  similar
charge; and

(b)  any  fine,  penalty,  surcharge,  interest  or  other
imposition  relating to any tax, duty, impost or levy
mentioned in paragraph  (a) of this  definition or to
any  account,  record,  form,  return or  computation
required  to  be  kept,   preserved,   maintained  or
submitted  to any person for the purposes of any such
tax, duty, impost or levy;

"TECHNICAL  INFORMATION"  shall mean all technical  data and know-how,
industrial  and technical  information,  trade  secrets,  confidential
information, drawings, formulations,  technical reports, operating and
testing procedures,  instruction  manuals,  raw material or production
specifications,  the results of research and development work, whether
in hard copy or in computer held form (including, for the avoidance of
doubt, such media as microfilm and microfiche);

"TEL SHARE SALE  AGREEMENT"  means the share sale agreement  dated [ ]
1998 between  Tioxide Group Limited (1) and Du Pont (U.K.) Limited (2)
relating  to the sale and  purchase  of the whole of the issued  share
capital of the Seller;

"THRESHOLD AMOUNT" has the meaning given in sub-Clause 5.5.2;

"TRANSFER TIME" has the meaning given to it in the Hivedown Agreement;

"UK GAAP" means generally accepted accounting principles in the United
Kingdom;

"US  DOLLARS",  "US$" or "$" means the lawful  currency  of the United
States of America; and

"WARRANTIES" has the meaning given in sub-Clause 5.1.

1.2  Unless  otherwise  stated,  any  express  reference  to  an  enactment
includes references to:

1.2.1   that enactment as amended, extended or applied by or under any
other enactment before or after this agreement;

1.2.2   any enactment which that enactment  re-enacts (with or without
modification); and

1.2.3   any  subordinate   legislation  made  (before  or  after  this
agreement)   under  any   enactment,   including   one  within
sub-Clauses 1.2.1 or 1.2.2 above,

except  to  the  extent  that  any  of  the  matters  referred  to  in
sub-Clauses  1.2.1 to 1.2.3 occurring after the date of this agreement
would  increase  or alter  the  liability  of the  Seller  under  this
agreement.

1.3  The  singular  shall  include  the  plural  and vice  versa  and words
denoting  persons shall include  bodies  corporate and  unincorporated
associations of persons and, unless  otherwise  stated,  shall include
successors or assigns of such persons.

1.4  Sub-Clauses 1.1 to 1.3 apply unless the contrary intention appears.

1.5 The headings in this agreement do not affect its interpretation.

1.6  Any  Schedule or Annex to this  agreement  shall take effect as if set
out in this agreement and  references to this agreement  shall include
its Schedules and Annexes.

1.7  Where any statement in this agreement (or in the attached Schedules or
Annexes)  (other  than in  Schedule  3  paragraphs  H(2)  and  H(3) is
qualified by the expression  "so far as the Seller is aware",  "to the
Seller's knowledge,  information and belief", "known to the Seller" or
any  similar  statement,  that  statement  shall be deemed to mean the
knowledge,  after  reasonable  investigation,   of  the  officers  and
operational  and functional  managers of the Seller and its Affiliates
who have direct  responsibility for the subject matter concerned being
those listed in Schedule 7.

1.8  Unless  the  context  otherwise  requires  and except in  relation  to
Taxation  matters,  references  in  sub-Clause  1.1,  sub-Clause  6.1,
Schedule  3 and  Schedule  6 to the  "Company"  in the  context of the
carrying on or operation of the Grimsby Business shall be deemed to be
a reference  to the Seller in relation to the carrying on or operation
of the Grimsby Business up to and until the Transfer Time.

2  SALE AND PURCHASE OF THE SALE SHARES

2.1  The  Seller  shall with full title  guarantee  sell and the  Purchaser
shall purchase the Sale Shares  together with all rights  attaching to
them.

2.2  The Sale Shares shall be sold free from all liens,  charges,  equities
and  encumbrances  and other rights  exercisable  by third  parties or
Affiliates of the Seller.

3  CONSIDERATION

3.1  The  consideration  for  the  sale  of  the Sale Shares  shall be US$1
payable in cash by  the Purchaser on Completion (the "CONSIDERATION").

3.2  The payment under  sub-Clause  3.1 shall be paid to the  correspondent
bank  named  below  for  credit  to the  US$  account  of o (the  "TEL
ACCOUNT") referred to below:

Correspondent bank:
Bank account:
Account name:
Account no:
Sort code:

3.3  Any payments to the Purchaser  under this  agreement  shall be paid to
the correspondent  bank named below for credit to the  US$  account of
[     ] (the "PURCHASER ACCOUNT") referred to below:

Correspondent bank:
Bank account:
Account name:
Account no:
Sort code:

4  PURCHASER'S WARRANTIES AND UNDERTAKINGS

4.1 The Purchaser warrants to the Seller that:

4.1.1   it  (and  each  of  its   Affiliates,   in   respect   of  the
Implementation  Agreements to which such Affiliate is a party)
has the  requisite  power and  authority  to enter into and to
perform this agreement and such Implementation Agreements;

4.1.2   it  (and  each  of  its   Affiliates,   in   respect   of  the
Implementation  Agreements to which such Affiliate is a party)
has obtained or satisfied all corporate,  regulatory and other
approvals, or any other significant  conditions,  necessary to
execute and perform  this  agreement  and such  Implementation
Agreements;

4.1.3   this agreement and the  Implementation  Agreements  constitute
valid and binding  obligations  of the Purchaser  (and each of
its Affiliates, in respect of the Implementation Agreements to
which such  Affiliate is a party)  enforceable  in  accordance
with their terms; and

4.1.4   compliance  with the terms of this  agreement by the Purchaser
and the  Implementation  Agreements  by the  Purchaser  or its
Affiliates (as appropriate) will:

(i) not  constitute  a breach of any  agreement or contract to
which the Purchaser or such  Affiliate of the Purchaser is
a party or by which it is bound; and

(ii)be   in   compliance   with   the   Purchaser's  or   such
Affiliate  of  the Purchaser's by- laws; and

(iii)not contravene:

(a)  any order, judgment or decree; or

(b)  any statute, rule or regulation; or

(c)  any  other  restriction  of any  kind  by  which  the
Purchaser  or  such  Affiliate  of the  Purchaser  is
bound.

4.2  The  Company  will  discharge  and pay in  full  the  Estimated  Newco
Hivedown  Debt at  Completion  and any  additional  amount  payable in
relation to any  adjustment  thereto as  described in  sub-Clause  7.2
below, such payments to be made to the TEL Account.

5  SELLER'S WARRANTIES AND UNDERTAKINGS

5.1  The Seller warrants to the Purchaser that, save as otherwise stated in
this  agreement  and subject to all matters and  circumstances  fairly
disclosed in the Grimsby Disclosure Letter, each of the statements set
out in Schedule 3 to this  agreement  (the  "WARRANTIES")  is true and
accurate as at the date of this agreement and the Seller  acknowledges
that the  Purchaser  has entered into this  agreement in reliance upon
the Warranties.

5.2  Each of the  Warranties  shall  be  separate  and  independent  and no
Warranty shall limit the scope or  construction  of any other Warranty
or any other provision of this agreement.

5.3 The Purchaser acknowledges and agrees that:

5.3.1   except for the Warranties,  no statement,  promise or forecast
made  by or on  behalf  of the  Seller  or any  member  of the
Seller's  Group or any  member  of the ICI  Group may form the
basis of, or be pleaded in connection  with,  any claim by the
Purchaser  under or in connection  with this  agreement or the
Implementation  Agreements  (save  as may  be  set  out in the
Implementation Agreements); and

5.3.2   any claim by the Purchaser or any person  deriving  title from
it in connection  with the Warranties  shall be subject to the
following provisions of this Clause.

5.4  The  liability  of the Seller  under or in respect of a Claim shall be
governed by the terms of this Clause 5 and shall be limited in respect
of any liability which is contingent,  unless and until such liability
becomes an actual liability and is due and payable,  provided that the
Purchaser  shall not be  prohibited  from  bringing such claim pending
such liability becoming due and payable.

5.5 It is hereby  agreed that the Seller  shall have no  liability  for any
Claim:

5.5.1   unless  the  amount  of such  Claim  exceeds  US$100,000  (the
"QUALIFYING Amount"); and

5.5.2   until and to the extent only that the aggregate  liability for
all  Claims   exceeding  the   Qualifying   Amount   (notified
previously  or at the same  time)  exceeds  US$5,300,000  (the
"THRESHOLD AMOUNT").

For  the  avoidance  of  doubt,  notwithstanding  that  the  aggregate
liability for Claims  exceeding  the  Qualifying  Amount  ("QUALIFYING
CLAIMS") of the Seller has exceeded the Threshold  Amount,  the Seller
shall be liable solely for that excess.

5.6  It is hereby agreed that the maximum aggregate liability of the Seller
in respect of all Claims shall under no  circumstances  exceed (to the
extent that the relevant  Claim has been  brought by the  Purchaser in
accordance  with the terms of this agreement  within the relevant time
period) an amount to be determined as follows (the "CAP"):

5.6.1   in respect of all Claims  notified  to the Seller  pursuant to
this agreement in the period commencing on the Completion Date
up to but not including the third anniversary thereof, the Cap
shall be US$63,152,000;

5.6.2   on the  third  anniversary  of  the  Completion  Date  the Cap
shall  reduce to US$44,206,400;

5.6.3   on  the  fourth  and  each   subsequent   anniversary  of  the
Completion  Date  the  Cap  shall  reduce  (but  so  that  the
applicable anniversary date for determining whether a Claim is
subject to a Cap reduction as aforesaid  shall be by reference
to the date upon  which the Claim is  notified  to the  Seller
pursuant  to  this  agreement  and  not the  date  upon  which
liability  thereunder is accepted or adjudicated) by an amount
of  US$6,315,200  such  that on the tenth  anniversary  of the
Completion Date it is completely extinguished.

5.7  Subject to sub-Clause 5.14, the Seller shall have no liability for any
Claims notified by the Purchaser on or after the tenth  anniversary of
the Completion Date.

5.8  For the avoidance of doubt, in no  circumstances  whatsoever shall the
maximum  aggregate  liability  of the  Seller in respect of all Claims
exceed US$63,152,000.

5.9 The Purchaser acknowledges and agrees that:

5.9.1   no  liability  shall  attach  to the  Seller  by reason of any
breach of any of the  Warranties  or other  provisions of this
agreement or the Implementation  Agreements to the extent that
the loss has been recovered by the Purchaser  under Schedule 6
or  any  other   term  of  this   agreement   or  any  of  the
Implementation  Agreements and  accordingly  the Purchaser may
only recover once in respect of the same loss; and

5.9.2   in  calculating  the liability of the Seller for any breach of
the Warranties there shall be taken into account the amount by
which any Taxation  for which the  Purchaser or the Company is
now or in the future  accountable  or liable to be assessed is
reduced or  extinguished as a result of the matter giving rise
to such liability.

5.10 The Purchaser shall not be entitled to make any Claim:

5.10.1  to the extent  that the Claim  arises as a result  only of any
change after Completion in the accounting bases upon which the
Company values its assets or computes its profits or arises as
a result of the  taxation  or  accounting  policies,  bases or
practices of the Purchaser being different to those adopted or
used in preparing the Grimsby Financial Information; or

5.10.2  to the extent that the matter which  constitutes the Claim was
specifically consented to in writing by the Purchaser.

5.11  The  Purchaser  shall not be  entitled  to rescind or  terminate  this
agreement after Completion in any circumstances  provided that nothing
in this sub-Clause shall exclude or limit any liability for fraud.

5.12  Save as otherwise provided in this agreement,  the Seller shall not be
liable in  respect  of any Claim as a result  of any  legislation  not
brought into force at the date of this agreement or as a result of any
change  in or repeal of  legislation  hereafter  or as a result of the
introduction  or cessation of or change in the  published  practice of
any taxation authority after the date of this agreement.

5.13  The  Purchaser  shall not be  entitled to make any claim in respect of
any  breach or alleged  breach of the  Warranties  or the  indemnities
contained  in this  agreement  or under  any other  provision  of this
agreement to the extent that:

5.13.1  the facts,  matters or  circumstances  giving rise thereto (in
respect of which any such claim or alleged  claim arises) have
been fairly disclosed in the Grimsby Disclosure Letter; or

5.13.2  such claim arises or is incurred as a result of any  voluntary
act or  omission  of the  Purchaser  or any  Affiliate  of the
Purchaser after the date of this agreement other than any such
act or omission which is in the ordinary course of business or
is  required  by  law  or is  pursuant  to a  legally  binding
commitment of the Company or any member of the Seller's  Group
created or entered into before Completion; or

5.13.3  allowance,  provision  or reserve  in  respect of the  subject
matter of such claim has been made or has otherwise been taken
into account or reflected in the mechanics for the calculation
of the Final Hivedown  Consideration or the Actual Net Working
Capital.

5.14  The  Purchaser  shall take all  reasonable  steps to mitigate any loss
which  may  give  rise  to a Claim  including,  without  limiting  the
generality of the foregoing,  the making of a claim which is available
to the  Purchaser  or its  Affiliates  under any  available  insurance
policy. It is agreed that:

5.14.1  no Claim  by the  Purchaser  in  respect  of a  breach  of the
Warranties shall be enforceable  unless written notice thereof
(including  all  material   details  thereof  then  reasonably
available to the Purchaser) has been given by the Purchaser to
the  Seller  as  soon  as  reasonably  practicable  after  the
Purchaser  has  become  aware of the facts  and  circumstances
giving  rise to such  claim  and  their  implications  for the
purposes of this  agreement and unless such written notice has
been  duly  served  on the  Seller  within  24  months  of the
Completion Date;

5.14.2  no other Claims by the Purchaser  shall be enforceable  unless
written notice thereof (including all material details thereof
or  relating   thereto  then   reasonably   available  to  the
Purchaser)  has been given by the  Purchaser to the Seller (in
accordance  with  the  terms  of  this  agreement)  as soon as
reasonably practicable after the Purchaser has become aware of
the facts and circumstances giving rise to the claim and their
implications for the purpose of this agreement;

Provided  however that the Purchaser  shall be able to bring any Claim
against the Seller  without  complying  with the terms of  sub-Clauses
5.14.1  and  5.14.2  hereof  to the  extent  that the  Seller  has not
suffered  prejudice  as a  result  of any such  non-compliance  by the
Purchaser.

5.15  If any claim is made  against the Company the subject  matter of which
might  also  reasonably  be  expected  to give  rise to a  Claim,  but
excluding  matters provided for in Schedule 6 in relation to which the
specific provisions set out in Schedule 6 shall apply:

5.15.1  the Purchaser  shall, if so requested by the Seller,  take all
steps which are  necessary and  reasonable  to avoid,  resist,
appeal,   compromise   or  defend   any  such  claim  and  any
adjudication  in respect thereof (but subject in any such case
to the Purchaser  being  indemnified by the Seller against all
costs and expenses  which may  reasonably  and  necessarily be
incurred in connection therewith) and the Seller shall, at its
request,  be allowed to conduct any negotiations,  proceedings
or appeals incidental thereto;

5.15.2  the Seller shall raise no objection to the Purchaser attending
(and,  where  the  rights  of the  Purchaser  are,  or may be,
detrimentally  affected) being separately legally  represented
(at its own  expense)  and,  where  appropriate,  heard at any
negotiations,  proceedings  or  appeals  which the  Seller has
taken conduct of pursuant to  sub-Clause  5.15.1 above and the
Purchaser  shall  be  consulted  by the  Seller  prior  to any
compromise, settlement or admission of liability being made by
the Seller at such negotiation, proceedings or appeals; and

5.15.3  the  Purchaser   shall  at  all  reasonable   times  and  upon
reasonable  prior  notice  allow  the  Seller  and its  agents
reasonable  access to all relevant  properties  of the Grimsby
Business,  and access to,  with the right to inspect  and take
copies of, all relevant books and records and Grimsby Business
Data of the  Grimsby  Business  (as then  carried  on) subject
always to keeping the same confidential  other than in respect
of necessary  disclosures  in  connection  with such action or
claim  which  disclosures  shall only be made and then only in
compliance with sub-Clause  5.15.4,  if required by law or the
procedures  of any court or  tribunal  or  otherwise  with the
prior written consent of the Purchaser (such consent not to be
unreasonably withheld or delayed);

5.15.4  if  the  Seller  or  its  agents  become   legally   compelled
(including   by   deposition,   interrogatory,   request   for
documents,  subpoena,  civil  investigative  demand or similar
process) to disclose any of the information, records, or other
material  referred  to in  sub-Clause  5.15.3,  the  party  so
compelled  shall  provide  the  Purchaser  with  prompt  prior
written  notice of such  requirement so that the Purchaser may
seek a protective order or other appropriate remedy. So far as
it is legally able so to do, the Seller agrees to cooperate in
the Purchaser's  efforts to obtain a protective order or other
reasonable  assurance  that  confidential  treatment  shall be
accorded any such  information.  If such  protective  order or
other remedy is not obtained, the party so compelled agrees to
disclose  only that portion of the  information,  records,  or
other  material  which it is  advised  by  opinion  of outside
counsel is legally  required to be  disclosed  and to take all
reasonable  steps  to  preserve  the  confidentiality  of  the
information,  records,  or other material  referred to in this
sub-Clause 5.15.4.

5.16  If the Seller pays to the Purchaser any amount under this agreement in
respect  of any  Claim and the  Purchaser  or the  Company  is able to
recover  any sum from any  third  party  (including  any  insurer)  in
respect of that Claim, the Purchaser shall, and shall procure that the
Company shall,  use all  reasonable  endeavours to so recover any such
sum and shall  repay to the Seller so much of the  amount  paid by the
Seller  as is  equal  to any sum  recovered,  after  allowing  for the
reasonable  costs  and  expenses  of  the  Purchaser  or  the  Company
reasonably  incurred in connection  therewith,  provided  that, in the
event that the Purchaser or the Company elects not to recover any such
sum from such third party, the Seller shall be entitled at its cost to
require  that  the  Purchaser  or the  Company  assign  such  right of
recovery to the Seller.  Furthermore,  if any liability on the part of
the Seller  hereunder  which  results  in a payment  being made by the
Seller to the  Purchaser  gives  rise to any  corresponding  saving or
rebate to the  Purchaser or the Company  (including  any tax saving or
rebate) then the value of such  corresponding  saving or rebate to the
Purchaser  or the Company  shall be set against the  liability  of the
Seller hereunder.

5.17  Any  payment  by  the  Seller  made  to  the  Purchaser  (or  for  the
Purchaser's  benefit) in respect of any liability under this agreement
for  breach of the  Warranties  or  otherwise  shall be deemed to be a
reduction  in the  consideration  payable  hereunder in respect of the
Sale Shares.

5.18  No party  hereto shall be entitled to set off any amounts due to it by
any other party  (whether  under this  agreement,  the  Implementation
Agreements or otherwise)  against sums owing (or claimed by such other
party to be  owing)  under the terms of this  agreement  (whether  for
breach of the Warranties or otherwise).

5.19  The provisions of this Clause 5 shall have effect  notwithstanding any
other provisions of this agreement.

5.20  The parties are of the view that the  provisions of Section 343 of the
Income and Corporation  Taxes Act 1988 and Section 171 of the Taxation
of  Chargeable  Gains Act 1992 will not apply in  connection  with the
sale and purchase of the Grimsby  Assets under the Hivedown  Agreement
and the Seller agrees and undertakes to prepare and submit tax returns
on the basis  that the said  Sections  343 and 171 are not  applicable
(the "AGREED  BASIS").  Subject to  compliance  by the Seller with the
foregoing  provisions  of this Clause  5.20,  the Seller shall have no
liability to the Purchaser if, notwithstanding such compliance,  Newco
fails to obtain capital allowances or allowable  expenditure under the
said Section 343 in a manner consistent with the Agreed Basis.

6  SELLER'S INDEMNITY

6.1  The Seller undertakes to indemnify and keep indemnified the Purchaser,
its Affiliates and the Company (the "INDEMNIFIED PARTIES") against all
claims  by third  parties  (other  than any  subsequent  purchaser  or
purchasers  of either the Sale Shares or the business or assets of the
Company  and their  successors  in title or  assigns)  giving  rise to
losses, costs, liabilities,  proceedings, claims, demands and expenses
(including  reasonable  legal fees) other than  liabilities  expressly
assumed  by  the   Purchaser   pursuant  to  this   agreement  or  the
Implementation  Agreements or to the extent that such liabilities have
been taken into account in the  mechanics for the  calculation  of the
Final  Hivedown  Consideration  or  the  Actual  Net  Working  Capital
(together,  "LIABILITIES")  which  may  be  incurred  by  any  of  the
Indemnified  Parties or to which any of the  Indemnified  Parties  may
become  subject  and which arise as a result of the  operation  of the
Grimsby Business by the Company prior to Completion  (unless the claim
made by the third  party  giving  rise to the  Liabilities  was fairly
disclosed in the Grimsby Disclosure Letter), including:

6.1.1   Liabilities  arising as a result of the failure by the Company
to comply with relevant and legally  enforceable  corporate or
other laws,  rules,  ordinances or regulations with respect to
the operations of the Grimsby Business prior to Completion

6.1.2   any breach of contract, tort, product liability or other claim
arising from, or with respect to, the operation of the Grimsby
Business  prior to Completion and asserted by any third party;
and

6.1.3   any   suit,   action,   arbitration,    charge,   governmental
investigation,  claim,  litigation or  proceedings  pending or
threatened at Completion and affecting the Grimsby Business or
the Company.

For the avoidance of doubt,  the indemnity  contained in this Clause 6
shall  not  apply  to (i) any  liability  to  Taxation;  or  (ii)  any
Environmental Liabilities, any failure or omission to obtain or comply
with Environmental  Authorisations,  any failure or omission to comply
with any  Environmental  Laws or any claim by any person in respect of
any  matter  concerning  the  Environment.  All  definitions  in  this
sub-Clause (ii) are as defined in Schedule 6.

6.2  The  Purchaser  agrees to give the Seller notice of any and all claims
asserted against any Indemnified Party for which indemnification is or
may be sought  under this Clause 6. Such notice shall be given as soon
as the Purchaser becomes aware that it has or may have a claim against
the Seller  under this Clause 6. Failure to give such notice shall not
abrogate or diminish the Seller's  obligation under this Clause if the
Seller has or receives knowledge of the existence of any such claim by
any other means or if such  failure  does not  prejudice  the Seller's
ability to defend such a claim.

6.3  In  any  litigation,   administrative   proceedings,   negotiation  or
arbitration  pertaining  to any  claim for  which  indemnification  is
sought  pursuant  to  sub-Clause  6.1 above the Seller  shall have the
right to select legal counsel to represent any  Indemnified  Party and
otherwise  to control such  litigation,  proceedings,  negotiation  or
arbitration.   If  the  Seller  elects  to  control  such  litigation,
proceeding,  negotiation or  arbitration,  the Purchaser shall have at
all times the right  fully to  participate  in the  defence at its own
expense.  If the Seller shall  within a  reasonable  time after notice
unreasonably  fail to defend the claim,  the Purchaser  shall have the
right  but not the  obligation  to  undertake  the  defence  of and to
compromise or settle the claim or any other matter on behalf,  for the
account,  and at the risk, of the Seller provided that such settlement
shall be  negotiated  and entered into by the Purchaser on a bona fide
basis and shall not  exceed  the sum  claimed.  In the event  that the
claim is one that  cannot  by its  nature  be  defended  solely by the
Seller with  reference to the personnel and  information  available to
the Seller,  the Purchaser  shall make available all  information  and
assistance  as the  Seller  may  reasonably  request  at the  Seller's
expense.

6.4  Notwithstanding the foregoing provisions, should the subject matter of
any litigation, proceeding, negotiation or arbitration include a claim
against any Indemnified Party seeking injunctive relief, the Purchaser
shall have the right to take  exclusive  control of the defence of the
entire proceedings.

7  COMPLETION

7.1  Completion  shall take place at the  offices of the [ * ]  immediately
after the signature of this agreement when:

7.1.1   each  party  shall  provide  to the other  evidence  in a form
reasonably  satisfactory to the other that it (and each of its
relevant Affiliates entering into an Implementation Agreement)
has all necessary corporate approvals and its signatories have
necessary authority to enter into this agreement and the other
agreements referred to herein

7.1.2   each  party  shall  (or  shall   procure   that  its  relevant
Affiliates)  duly  execute  and,  to  the  extent  applicable,
complete the Implementation Agreements

7.1.3   the Seller shall deliver to the Purchaser:

(i) a duly  executed  transfer  or  transfers in favour of the
Purchaser of all the Sale Shares;

(ii)share  certificate(s) or other documents of title relating
to the Sale  Shares  (or an  express  indemnity  in a form
reasonably  satisfactory  to the  Purchaser in the case of
any missing certificates or documents of title);

(iii)the  company  books  relating to the  Company,  including
certificates of incorporation, common seals, minute books,
statutory  registers,  shareholders'  agreements and share
certificate books (duly written up to date);

(iv)resignations of [all] the  directors  and secretary of the
Company in the  Agreed Form;

[(v)the written  resignation of the auditors of the Company to
take effect on Completion,  with acknowledgments signed by
them to the  effect  that they have no claim  against  the
Company and to the effect that there are no  circumstances
connected  with  their  resignation  which  they  consider
should be  brought to the  notice of the  shareholders  or
creditors of the Company;]

(vi)the Grimsby Business Data;

(vii)the  documentation  and  title  deeds  to   the   Grimsby
Properties   in   accordance   with  the   provisions   of
Schedule 2;

7.1.4   the Purchaser shall pay to the Seller the Consideration;

7.1.5   the  Company  shall  discharge  and pay in full the  Estimated
Newco Hivedown Debt (being the sum of  US$118,410,000)  to the
Seller, such payment to be made to the TEL Account;

7.1.6   the Seller  shall take,  or shall  procure the taking of, such
steps as may be necessary to:

(i) approve the transfers  referred to in sub-Clause 7.1.3 (i)
(subject  only to the  Purchaser  arranging and paying any
taxes or duties arising in relation to the transfer); and

(ii)appoint  such  directors  and  secretary as the  Purchaser
may specify as directors and the secretary of the Company.

7.2  If the Final  Hivedown  Consideration  exceeds the Estimated  Hivedown
Consideration,  the excess  shall be paid by the Company to the Seller
in accordance with the provisions of sub-Clause 3.2 and Schedule 14 of
the Hivedown Agreement, such payment to be made to the TEL Account.

8  GRIMSBY EMPLOYEES

The Purchaser  agrees to procure that the Company for a period of four
years from the Completion Date will procure that:

8.1  the Grimsby Employees will receive and enjoy contractual  remuneration
and   benefits   (including   retirement   benefits)   which,   judged
objectively,  are no less  favourable  overall than their  contractual
remuneration and benefits at the Completion Date; and

8.2  it will not make any  unilateral  material  change to the  contractual
terms and conditions of employment with the Grimsby  Employees  (which
includes those terms  contained in a letter to employees dated 19 June
1991 from the Seller) without prior consultation where required by any
local laws or agreements,  with recognised  trade unions,  appropriate
employee representatives, or the Grimsby Employees.

9  GRIMSBY PROPERTIES

The Seller and the Purchaser  shall observe and perform the provisions
of Schedule 2 expressed to be observed  and  performed by each of them
respectively.

10  PENSIONS

Schedule 4 shall apply.

11  ENVIRONMENTAL AND COPPERAS

11.1  The Seller and Purchaser  shall observe and perform the  provisions of
Schedule 6 expressed  to be  observed  and  performed  by each of them
respectively.

11.2  The Seller  covenants  that for a period of three years from and after
the Completion  Date,  none of the Seller and/or any of its Affiliates
will  directly  or  indirectly  market,  sell or offer for sale in the
United  Kingdom any  copperas  product  provided  that nothing in this
clause  shall  prevent the Seller  and/or any of its  Affiliates  from
purchasing  shares in any company or  purchasing  any  business  which
carries on as an ancillary  part of its entire  business (so as not to
form a substantial part of the same), the marketing, sale or offer for
sale of any copperas product.

12  ANNOUNCEMENTS

Neither  party  shall make or permit any member of the Seller's  Group
or the Purchaser's Group, as the case may be, to make any announcement
concerning  this agreement or any ancillary  matter except as required
by law or any  competent  regulatory  body or with the  prior  written
approval of the other party.

13  DEFAULT INTEREST

Subject as otherwise  provided to the contrary in this  agreement,  if
any sum due for payment  under this  agreement or in  accordance  with
this  agreement is not paid on the due date the party in default shall
pay  Default  Interest on that sum from the due date until the date of
actual payment calculated on a day to day basis.

14  NOTICES

14.1  Any notice or other document to be served under this  agreement  shall
be in writing and may be delivered by hand or by courier,  sent by fax
or by post to the party to be served at its address  appearing in this
agreement  (and marked for the  attention  of the person whose name is
referred to in  sub-Clause  14.3  below) or at such other  address (or
marked for the attention of such other person) as it may have notified
to the other party in accordance with this Clause. Any notice or other
document sent by post shall be sent by registered post (if both posted
and for  delivery  within  the  same  jurisdiction)  or by  registered
airmail (if posted for delivery  outside the  jurisdiction in which it
is  posted),   in  either  case  return  receipt   requested  (or  any
substantially equivalent service).

14.2  Any  notice  or  document   delivered  or  sent  in  accordance   with
sub-Clause 14.1 shall be deemed to have been served:

14.2.1  if delivered by hand, at the time of delivery; or

14.2.2  if  sent  by  fax,  at  the  time of delivery if sent  between
12.01 a.m.  and  6.00 p.m.  (local  time  at the  destination)
or at 10.00 a.m. on  the  Business  Day after transmission  if
sent at any other time; or

14.2.3  if posted,  at 10.00 a.m. on the second  Business Day after it
was put into the post if posted for  delivery  within the same
jurisdiction,  or at 10.00  a.m.  (local  time at the place of
destination) on the fifth Business Day after it was put in the
post if sent by registered airmail.

14.3  The person to whom  notices or documents  should be addressed  for the
purposes of sub-Clause 14.1 is:

14.3.1  if to be served on the Seller or on Affiliates of the Seller:

Vice President & General Manager
White Pigment & Mineral Products
E.I. du Pont de Nemours and Company
Building 36-2nd Floor
Barley Mill Plaza
Wilmington, Delaware USA 19880
Fax: (1) 302 992 6084

with a copy to the  Company  Secretary  of  Imperial  Chemical
Industries PLC of Imperial Chemical House, 9 Millbank, London,
SW1P 3JF, Fax: (44) 171 798 5170;

14.3.2  if to be served on the Purchaser:

General Counsel
N L Industries, Inc.
16825 North Chase Drive
Suite 1200
Houston
Texas USA 77060
Fax: (1) 281 423 3333

14.4  In proving  service of a notice or document it shall be  sufficient to
prove that  delivery was made by hand or that the envelope  containing
the notice or document was properly  addressed  and posted  (either by
registered  post or by  registered  airmail,  as the case  may be,  in
accordance with the requirements of this Clause).

15  GENERAL

15.1  Each of the  obligations,  warranties and undertakings set out in this
agreement  which is not fully performed at Completion will continue in
force after Completion.

15.2  Unless otherwise  expressly stated, all claims made and payments to be
made under this agreement shall be made in US Dollars. Payments to the
Seller shall be made in immediately  available funds to the account of
the Seller at the TEL  Account or at such other  account as the Seller
may  notify  to the  Purchaser  and to the  Purchaser  in  immediately
available funds to the Purchaser  Account or such other account as the
Purchaser may notify to the Seller. All payments and values under this
agreement  shall be in US Dollars  and,  where an amount is not itself
calculated in US Dollars, it shall be converted into US Dollars at the
mid-market  closing  exchange  rate for that currency in US Dollars as
published in the London Edition of The Financial  Times  published two
Business  Days prior to the date on which the relevant  payment is due
or, where no such rate is  published,  at the rate quoted by Citibank,
N.A. at the close of business in London on that date.

15.3  Save as  otherwise  provided to the contrary in this  agreement,  each
payment to be made under this agreement  shall be made in the currency
in which  the  relevant  amount  is  payable,  free  and  clear of all
deductions or withholdings  of any kind,  except for those required by
law and,  if any  deduction  or  withholding  must be made by law,  an
additional  amount will be paid which is  necessary to ensure that the
recipient  receives a net  amount  equal to the full  amount  which it
would have received if the payment had been made without the deduction
or withholding.

15.4  None of the rights or obligations under this agreement may be assigned
or  transferred  without the  written  consent of the other party (the
"NON-ASSIGNING Party") other than an assignment of the rights (but not
the obligations) to an Affiliate of the assigning party provided that:

15.4.1  such assignment  shall only be permitted if the assignment has
no adverse effect on the Non-assigning Party;

15.4.2  if the Affiliate to which the rights have been assigned ceases
to be an Affiliate of the  assigning  party,  the rights which
have been  transferred  shall be  re-transferred  to the party
which originally assigned those rights or to another Affiliate
of that original assigning party; and

15.4.3  it shall be a condition of any such assignment that reasonable
notice is given in writing to the  Non-assigning  Party of the
proposal  to assign  (identifying  the rights  proposed  to be
assigned, the identity of the proposed assignee and such other
details  relating  thereto  as  the  Non-assigning  Party  may
reasonably require).

15.5  Save as otherwise provided in this agreement, each party shall pay the
costs and expenses  incurred by it and its  Affiliates  in  connection
with the entering into and completion of this agreement.

15.6  This agreement may be executed in any number of  counterparts,  all of
which taken together  shall  constitute one and the same agreement and
any party may enter into this agreement by executing a counterpart.

15.7  No amendment,  variation or waiver of this  agreement or any provision
of this agreement shall be effective  unless it is in writing and duly
executed by or on behalf of both parties.

15.8  Both parties  shall at their own expense at all times from the date of
this agreement do all things as may be required to give effect to this
agreement  including,  without limitation,  the execution of all deeds
and documents,  procuring the convening of all meetings, the giving of
all  waivers  and  consents  and the  passing of all  resolutions  and
otherwise exercising all powers and rights available to them.

16  WHOLE AGREEMENT

16.1  Subject  to   sub-Clause   16.2   below,   this   agreement   and  the
Implementation  Agreements  (if and when  executed)  contain the whole
agreement between the parties and their respective Affiliates relating
to  the   transactions   contemplated   by  this   agreement  and  the
Implementation   Agreements  and  supersede  all  previous  agreements
between the parties and their respective  Affiliates  relating to such
transactions.

16.2  A provision in another agreement between the parties to this agreement
or between the  respective  parent  undertakings  of the parties  (and
whether made before or after the date of this agreement)  which refers
to this  agreement and which extends or  supplements  any provision in
this  agreement  will be deemed for the  purposes of  sub-Clause  16.1
above to form part of the  whole  agreement  between  the  parties  as
referred to in that sub-Clause.

16.3  Each of the parties to this agreement  acknowledges  on its own behalf
and on behalf of each of its  Affiliates  that,  in  agreeing to enter
into this  agreement  and the  Implementation  Agreements,  it has not
relied on any representation,  warranty,  collateral contract or other
assurance  (except  those set out in this  agreement)  and  waives all
rights and remedies which, but for this sub-Clause, might otherwise be
available  to it in  respect  of any  such  representation,  warranty,
collateral contract or other assurance,  provided that nothing in this
Clause shall limit or exclude any liability for fraud.

17  GOVERNING LAW

This  agreement is governed by and shall be  construed  in  accordance
with English law.

18  JURISDICTION

The  parties  agree to submit  to the  exclusive  jurisdiction  of the
English  courts  for all  purposes  relating  to this  agreement.  The
Purchaser  irrevocably  appoints  Herbert  Smith (Ref 554) of Exchange
House,  Primrose  Street,  London EC2A 2HS as its agent for service of
process.in England.

AS WITNESS  the hands of the duly  authorised  representatives  of the
parties on the date which first appears on page 1.

SCHEDULE 1
PARTICULARS OF THE COMPANY
(RECITAL A)

[      ] LIMITED

Date and place of incorporation:
Registered Office:
Registered number:
Authorised Share Capital:    GBP *
Issued Share Capital:        GBP * divided into 2 Ordinary Shares
of GBP1 each
Shareholders:                Tioxide Europe Limited (or its nominees)
Directors:
Secretary:

SCHEDULE 2
GRIMSBY PROPERTIES
(SUB-CLAUSE 7.1.3(VII))

On  Completion  the Seller shall  deliver to the  Purchaser  all title
documentation (and other documentation  disclosed to the Purchaser) in
connection with the Grimsby Properties.

SCHEDULE 3
WARRANTIES
(CLAUSE 5)

A. GENERAL

A.1  CAPACITY AND CONDUCT OF THE GRIMSBY BUSINESS

(1)  The   Seller   (and  each  of  its   Affiliates   in  respect  of  the
Implementation Agreements to which they are parties) has the requisite
power and  authority to enter into and to perform this  agreement  and
such Implementation Agreements.

(2)  The  Seller   (and  each  of  its   Affiliates,   in  respect  of  the
Implementation  Agreements  to which they are parties) has obtained or
satisfied all corporate,  regulatory and other approvals, or any other
significant   conditions,   necessary  to  execute  and  perform  this
agreement and the Implementation Agreements.

(3)  This agreement and the Implementation  Agreements  constitute (or when
executed will constitute) valid and binding  obligations of the Seller
(and  each  of  its  Affiliates,  in  respect  of  the  Implementation
Agreements to which they are parties)  enforceable in accordance  with
their terms.

(4)  The execution and  compliance  with the terms of this agreement by the
Seller  and  the  Implementation  Agreements  by  the  Seller  or  its
Affiliates (as appropriate) will:

(a) not constitute a breach of any Material  Grimsby  Contract
to which the Seller (or any of its  Affiliates) is a party
or by which it or they are bound or entitle  any person to
terminate or avoid any such agreement or contract;

(b) be in  compliance  with  the  Seller's  and the  Company's
memorandum   and   articles   of   association   or  other
constitutional   documents   (or   those  of  any  of  its
Affiliates);

(c) not contravene any order,  judgment,  decree or regulation
or any other  restriction  of any kind by which the Seller
or any of its Affiliates or the Company is bound; or

(d) not  result in the loss or  impairment  of or any  default
under any licence,  authorisation  or consent  required by
the Company for the purposes of its business.

(5)  All  factual  information  contained  in  Schedule 1  relating  to the
Company is true and accurate in all material respects.

A.2  THE COMPANY

(1)     The   information   relating   to  the  Company  contained  in
Schedule 1 is true and accurate.

(2)     Compliance  has been  made  with  all  legal  requirements  in
connection  with the  formation  of the Company and all issues
and grants of shares,  debentures  or other  securities of the
Company.

A.3  OWNERSHIP OF SALE SHARES

(1)     The Seller is the sole legal  owner of the Sale  Shares  which
constitute the entire issued share capital of the Company.

(2)     The Seller is entitled to sell and procure the transfer of the
full  legal  ownership  in  the  Sale  Shares  free  from  any
encumbrance, equity or third party right of whatsoever nature,
from any  agreement or contract to grant the same and from any
claim to any of the same.

(3)     The Sale Shares are fully paid up or credited as fully paid up
and  constitute  the whole of the  issued and  allotted  share
capital owned by the Seller in the Company.

(4)     No agreement or contract has been entered into which  requires
or may require the Company to allot or issue any share or loan
capital  and  the  Company  has not  allotted  or  issued  any
securities which are convertible into share or loan capital.

A.4  SUBSIDIARIES

(1)     The Company is not the holder or beneficial  owner of (nor has
agreed to acquire)  any class of any shares or loan capital or
other   securities   of   any   other   corporation   (whether
incorporated in the United Kingdom or elsewhere).

(2)     The  Company  is not and has not  agreed to become a member of
any   partnership   or   other   unincorporated   association,
joint-venture  or  consortium  (other  than  recognised  trade
associations).

(3)     The Company  does not have any place of business or  permanent
establishment   (as  that  expression  is  defined  in  double
taxation conventions) outside the United Kingdom.

A.5  OWNERSHIP OF GRIMSBY ASSETS

(1)     Except  for the  Excluded  Assets  and those  assets  that are
leased (as  described  in the Grimsby  Disclosure  Letter) the
Company has full legal and beneficial title to all the Grimsby
Assets reflected in the Grimsby  Financial  Information  (save
for  current   assets  and  fixed   assets   worth  less  than
US$100,000,  both as defined  for the  purposes of the Grimsby
Financial  Information,  disposed  of by  the  Company  in the
ordinary course of its business since 28 February 1998) and to
all Grimsby  Assets  acquired by the Company since 28 February
1998.

(2)     None of the  Grimsby  Assets  is  subject  to any  encumbrance
(including without limitation any debenture, mortgage, charge,
lien,  deposit  by way of  security,  bill of sale,  option or
right of  preemption)  except those that arise in the ordinary
course of business and do not have a material  adverse  effect
on the  Grimsby  Business.  All  significant  items of Grimsby
Plant  and  Equipment   have  been  regularly  and  adequately
maintained where such maintenance is normally required and are
in reasonable working order having regard to their age and use
and taken as a whole are  capable  of  operating  the  Grimsby
Business fully and effectively as previously carried on by the
Company.

(3)     Save for fluctuations and variations in the Grimsby Stocks due
to  normal  business  factors  including  without   limitation
production  schedules  and market demand  (including  seasonal
factors  affecting  the same) the Grimsby  Stocks in aggregate
comprise broadly the same mix of products as has been required
and has been maintained at levels sufficient to meet the level
of sales of the Grimsby  Business for the last four  quarters.
The Grimsby  Stocks are owned by the Company free and clear of
all liens,  claims,  charges and  encumbrances  other than any
such interests arising in the ordinary course of business. The
Grimsby Stocks are located at the Grimsby Properties.

(4)     The  Company  owns or has the  right  to use all the  property
rights and assets  necessary for the Company to carry on fully
and effectively  the Grimsby  Business in the manner in and to
the extent to which it is presently conducted.

(5)     The  Grimsby  Business  Data (other  than  historical  Grimsby
Business Data) contains in all material respects bona fide and
accurate records of all matters  customarily or required to be
dealt  with  therein.   The  Grimsby  Business  Data  and  the
Company's  information,  and the  means of  access to them are
exclusively  owned by it and under its  direct  control or are
under its authority.

(6)     The Grimsby  Disclosure Letter contains details of the current
insurance  arrangements  applicable  to the Grimsby  Business.
Those  arrangements are in full force and effect, all premiums
have been duly paid and so far as the Seller is aware, nothing
has been  done or  omitted  to be done  which  would  make any
policy of insurance of the Company void or voidable.  There is
no material claim outstanding under any such arrangement.

A.6  COMPLIANCE WITH STATUTES

In  relation  to  the  Grimsby   Business,   the  Company  is  not  in
contravention  of any  statute,  order  or  regulation  of the  United
Kingdom or any relevant foreign country,  including but not limited to
the Foreign Corrupt  Practices Act and the United States  anti-boycott
regulations,  which is likely to result in a fine or  penalty or which
would have a material adverse effect on the Grimsby Business. There is
no order,  decree or judgment of any court or  governmental  agency of
the United  Kingdom or any  foreign  country  outstanding  against the
Company in relation to the Grimsby Business.

A.7  LICENCES AND CONSENTS

In relation to the  operation  of the  Grimsby  Business  prior to the
Transfer Time by the Seller, the Grimsby Business had all governmental
authorisations  licences and consents necessary to own and operate the
Grimsby  Assets and to carry on the Grimsby  Business in the manner in
which such business was carried on. All such authorisations,  licences
and consents were valid and  subsisting  and were complied with in all
material respects.  The Seller has paid all fees due under the same. A
list of material  Permits  relating to the Grimsby  Business  has been
disclosed and identified in the Grimsby Disclosure Letter.

A.8  LITIGATION

(1)     Except as  disclosed  in the Grimsby  Disclosure  Letter,  the
Company  is not  engaged  in  any  litigation  or  arbitration
proceedings except as plaintiff for collection of debts in the
ordinary  course of  business  which is likely to involve  the
Company  claiming  or paying sums in excess of  US$100,000  or
which  otherwise will have a material  effect on the operation
of the Company and the Grimsby  Business and there are no such
proceedings  pending  and no  letter  before  action  has been
received  by the  Company  and so far as the  Seller  is aware
there   are  no  facts   likely  to  give  rise  to  any  such
proceedings.   The  Seller  has   disclosed   in  the  Grimsby
Disclosure  Letter a list (which is complete  and  accurate in
all material respects) which includes a general description of
each pending law suit, claim,  including customer  complaints,
administrative  proceedings,  arbitration,  labour  dispute or
governmental  investigation or inspection to which the Company
is a party or involves the  operation of the Grimsby  Business
and which is likely to involve the Company  claiming or paying
sums in excess of  US$100,000.  The  Seller has  disclosed  in
general terms all material  (individually or in the aggregate)
product  liability  claims  received  by the Company or by the
Seller  during the last 3 years.  There are no orders  decrees
judgments  or  agreements   with  any  Court  or  governmental
authority to which the Company or the Seller (on behalf of the
Company)  is a party or by which the Company or the Seller are
bound and which will have a material  effect on the  operation
of the Company and the Grimsby Business.

(2)     No administrator,  receiver or administrative  receiver or any
other equivalent  officer has been appointed in respect of the
Company   or  in  respect  of  any  parts  of  the  assets  or
undertakings of the Company.

(3)     No petition  has been  presented,  no order has been made,  no
resolution  has been passed and no meeting  has been  convened
for the  winding-up  of the  Company or for an  administration
order to be made in  relation  to the Company nor has any such
order been made.

(4)     No  voluntary  arrangement  has  been  approved  under  Part I
Insolvency Act 1986 and no compromise or arrangement  has been
sanctioned  under  Section  425 of the Act in  respect  of the
Company.

(5)     The Company has not become unable to pay its debts.

(6)     No  distress,  distraint,  charging  order,  garnishee  order,
execution  or other  process has been levied or applied for in
respect  of the  whole  or any  part  of any of the  property,
assets and/or undertaking of the Company.

A.9  ENVIRONMENTAL MATTERS

(1)     Environmental authorisations

In relation to the Grimsby Business:

(a) Prior  to the  Transfer  Time,  the  Seller  had  lawfully
obtained all  Environmental  Authorisations  and each such
authorisation  at such time was in full  force and  effect
and the Seller had complied at all times therewith and the
Company,    having   obtained   all   such   Environmental
Authorisations  (on the same terms and subject to the same
conditions  as those held by the Seller),  will be able to
continue  to comply in the future with all  conditions  of
such authorisations.

(b) No works or costs  are or will be  necessary  to obtain or
secure   compliance   with  or   maintain   any   existing
Environmental   Authorisations   or  their  conditions  or
otherwise to comply with Environmental Laws.

(c) The Company has received no  communication  in any form in
respect  of  any  Environmental   Authorisation   varying,
modifying in any material respect, revoking, suspending or
cancelling   the  same  or   indicating  an  intention  or
threatening  so to do and so far as the  Seller  is  aware
there are no facts or  circumstances  which may  result in
any Environmental Authorisation being so varied, modified,
revoked, suspended or which may prejudice their renewal.

(d) So far as the Seller is aware all appropriate or necessary
action in  connection  with the renewal or extension of an
Environmental Authorisation has been taken.

(e) The  Company is not  engaged  in and,  so far as Seller is
aware,  there  are  no  facts  which  make  it  likely  or
desirable  that it  should  be  engaged  in any  appeal in
respect  of  any   Environmental   Authorisation   or  any
conditions   contained  therein  or  any  refusal  of  any
Environmental Authorisation.

(f) So far as the  Seller  is  aware  there  is no  reason  to
believe that those Environmental Authorisations which have
been  applied  for but which have not yet been  granted or
are pending will not be granted within a reasonable period
of time and on terms which are acceptable in order for the
Company to continue its current business operations.

(g) So  far  as the  Seller  is  aware  the  execution  and/or
performance  of this  agreement  and all  other  documents
which are to be executed at Completion  will not result in
any Environmental  Authorisations being varied,  modified,
revoked, suspended, cancelled, or not renewed.

(2)     Compliance with Environmental Laws

In relation to the Grimsby Business:

(a) The Company is in compliance with  Environmental  Laws and
the state and use of the Grimsby  Properties  have been at
all times in conformity with Environmental Laws.

(b) The Company has not received any communication in any form
from any  competent  authority  requiring  the  taking  of
remedial or other steps in  relation to the  pollution  or
protection of the  Environment  or the state or use of the
Grimsby  Properties.  So far as the Seller is aware  there
are  no  circumstances  which  might  give  rise  to  such
communications  being received and the Seller is not aware
of any intention on the part of any such authority to give
such notice.

(c) No proceedings or other action, claim or investigation are
or have been in  existence  or are so far as the Seller is
aware  pending or threatened  against the Company  arising
from or in relation to any Environmental Authorisations or
otherwise concerning Environmental Laws.

(3)     Liability

In relation to the Grimsby Business:

(a) The  Company or the  Seller,  in  relation  to the Grimsby
Business, has not received any notice or intimation of any
complaint  or claim  from any  person  in  respect  of any
matter concerning the Environment.

(b) The  Company or the  Seller,  in  relation  to the Grimsby
Business, are not and have not been engaged in any action,
litigation,  arbitration or dispute resolution proceedings
relating  to  or   concerning   any  actual  or  potential
liability under  Environmental  Laws and the Seller is not
aware of any such matters  pending or being  threatened or
of any  circumstances  or facts likely to give rise to any
such matters.

(c) The  Company or the  Seller,  in  relation  to the Grimsby
Business,  are  not  and  have  not  been  subject  to any
injunction  or  similar  remedy  or  order  by a court  of
competent  jurisdiction,  or to any undertakings  given to
such  court  in  respect  of any  matters  relating  to or
concerning the Environment.

(4)     As far as the Seller is aware,  there has not been in relation
to the  Grimsby  Business  in the last three years any adverse
report,  complaint or  investigation  of the Health and Safety
Executive   (or  any  non  UK   equivalent   if  any)  or  any
prosecution,  formal  caution or warning for any  violation of
any applicable  laws or  regulations  including the Health and
Safety at Work etc.  Act 1974 and the  Control  of  Substances
Hazardous to Health Regulations 1987.

A.10  DATA ROOM DOCUMENTS

(1)     Save as  disclosed  in  Schedule 7 of the  Grimsby  Disclosure
Letter, so far as the Seller is aware,  each licence,  permit,
contract,  list and report set out in Annex 1 and disclosed in
the Data Room,  and  identified on Annex 1 by reference to the
reference number set out in the Data Room Index annexed to the
Grimsby Disclosure Letter:

(a) other than where redacted, is a true copy of the original;

(b) is the latest version thereof;

(c) is complete; and

(d) has not been  altered,  amended  or varied  since the date
thereon.

(2)     To the extent that any note,  summary or response to questions
of or in respect of the  documents set out in Annex 1 referred
to in sub-Paragraph A.10(1) contains any expression of opinion
of the ICI Group (not including the opinion of third parties),
such opinion  reflects the current  reasonably held opinion of
its  author  given  in good  faith  taking  into  account  the
respective author's knowledge and understanding.

B. GRIMSBY FINANCIAL INFORMATION
(1)     The Grimsby  Financial  Information  has been derived from the
books of the Grimsby Business of the Seller,  which books have
been  regularly and  consistently  kept and  maintained  using
ICI's normal  accounting  policies and practices as set out or
referred  to  in  the  ICI's  Controller's  Manuals  (and  the
policies  contained in these Manuals are in accordance with UK
GAAP)  as  applied  by the  Seller  on a  consistent  basis in
accordance  with UK GAAP and,  on such basis,  represents  the
assets  and  liabilities  of  the  Grimsby  Business  as at 28
February 1998.

(2)     The  Grimsby  Financial  Information  does not,  so far as the
Seller  is  aware,  materially  mis-state  any of the  matters
presented therein. Since 28 February 1998 there has been:

(a) no  material   change  in  any   accounting  or  inventory
valuation  methods used by the Company in connection  with
the Grimsby Assets;

(b) no upward re-valuations of existing Grimsby Stocks; and

(c) no  material  adverse  change in the  Grimsby  Business or
financial condition of the Company, which for this purpose
shall not include the  inherently  cyclical  nature of the
titanium dioxide industry or general economic conditions.

C. ANTI-COMPETITIVE ARRANGEMENTS
(1)     The  carrying on of the Grimsby  Business by the Company  does
not require any agreement, arrangement,  concerted practice or
course of conduct  which is material  to the Grimsby  Business
and which:

(a) is subject to  registration  under the  Restrictive  Trade
Practices Acts 1976 and 1977 but is not so registered;

(b) infringes  Article 85 or 86  of  the  Treaty  establishing
the  European Community;

(c) is an  "anti-competitive  practice"  within the meaning of
the Competition Act 1980.

(2)     The  Company  or  the  Seller,  in  relation  to  the  Grimsby
Business,  have not  received  in the  last  three  years  any
process, notice or communication, formal or informal, from the
Office  of  Fair  Trading  or  Directorate  General  IV of the
European  Commission,  relating  to any aspect of the  Grimsby
Business  which  alleges any illegal  practices in relation to
the Grimsby Business and so far as the Seller is aware no such
process, notice or communication is likely to be received.

D. MATERIAL GRIMSBY CONTRACTS
(1)     Copies of all the Material  Grimsby  Contracts  are annexed to
the Grimsby Disclosure Letter.

(2)     The Company is not in breach of, or default under,  any of the
Material Grimsby  Contracts or any other Grimsby Contracts the
consequence  of which  would or may  have a  material  adverse
effect on the Company in relation to the Grimsby Business and,
so far as the  Seller  is aware,  no state of facts  exists or
event has occurred,  is pending or is threatened which,  after
the  giving  of  notice  or the  lapse of  time,  would or may
constitute or result in a breach or a default by the Seller or
by the  Company  or any other  person,  firm,  corporation  or
entity of or in relation to any contract the  consequences  of
which  would have a material  effect on the  operation  of the
Grimsby  Business.  All Material  Grimsby  Contracts are legal
valid  and  binding   obligations   of  the  Company  and  are
enforceable in accordance with their terms.

E. GRIMSBY EMPLOYEES
(1)     Particulars of the material terms of employment of all Grimsby
Employees  and  officers  of the  Company  are  annexed to the
Grimsby  Disclosure  Letter  and such  particulars  are  true,
complete and accurate in all material respects.

(2)     No  Grimsby  Employee  of Grade 37 or above  has  given to the
Company or the Seller and  neither  the Company nor the Seller
have  received,   or  given,  notice  of  termination  of  his
employment.

(3)     No more than 50 Grimsby  Employees  at the  Grimsby  Site have
given to the Company or the Seller and neither the Company nor
the Seller have received,  or given,  notice of termination of
their employment.

(4)     Standard form consultancy agreements,  agency or self-employed
or contracted  labour  agreements  or contracts  where sums in
excess of  GBP50,000  per annum are paid or are payable by the
Company have been disclosed in the Grimsby  Disclosure Letter.

(5)     The collective  agreements,  union recognition  agreements and
European  Works  Council  agreements  annexed  to the  Grimsby
Disclosure  Letter are all the agreements  between the Company
and the trade  unions  or  representative  bodies  constituted
pursuant to the European Works Council Directive No. 94/45/EC.

(6)     So far as the Seller is aware, there is no material industrial
action by the  Grimsby  Employees  pending  or  threatened  in
relation to the Grimsby Business nor has there been within the
last 12 months.

(7)     Since 28 February  1998 there has been no  material  change in
rates of  remuneration  or other  benefits  or other  terms of
employment  of the  Grimsby  Employees.  The  Company is not a
party to any contractual  arrangement to make material changes
to remuneration or other benefits or other terms of employment
or to  establish  any new bonus  arrangements  for the Grimsby
Employees.

(8)     Particulars  of all  loans  made  by the  Company  to  Grimsby
Employees  which are in excess of  US$100,000  and which shall
remain  outstanding at Completion,  together with sums owed by
the Company to any Grimsby  Employee (other than  remuneration
and other  contractual  or  customary  benefits)  which are in
excess of US$100,000,  are disclosed in the Grimsby Disclosure
Letter.

(9)     No Grimsby Employee of Grade 37 or above  previously  employed
by the  Company  has a right to return to work or any right to
be  reinstated  or  re-engaged  by the Company  whether  under
statute or otherwise.

(10)    No  more  than  50  Grimsby  Employees  at the  Grimsby  Site,
previously employed by the Company,  have a right to return to
work or any  right  to be  re-instated  or  re-engaged  by the
Company whether under statute or otherwise.

(11)    A list of all Grimsby Employees of Grade 37 and above seconded
from ICI at the  Grimsby  Site is set out in or annexed to the
Grimsby Disclosure Letter.

(12)    In relation to the  Grimsby  Employees,  there are no existing
nor,  so far as the  Seller is aware,  threatened  arbitration
procedures  arising out of or under any union  recognition  or
works council agreement covering the Grimsby Employees nor, so
far as the Seller is aware, does any basis therefore exist nor
has  the  Seller  or the  Company  received  any  request  for
recognition or representation by any trade union not currently
recognised on the Grimsby Site.

(13)    The Company has  complied in all  material  respects  with all
statutes, regulations, orders and codes of conduct relating to
employment  and  relations  with Grimsby  Employees  and trade
unions and has  maintained  records  required by law regarding
the service of each of its Grimsby Employees.

(14)    The Grimsby Disclosure Letter contains  approximate numbers of
Grimsby  Employees  at the Grimsby  Site as at the stated date
together with approximate  numbers of Grimsby  Employees below
Grade 37 and  approximate  numbers of Grimsby  Employees above
Grade  37.  The  Grimsby   Disclosure   Letter  also  contains
approximate  numbers  of  employees  of the  Company  who  are
employed at locations other than at the Grimsby Site.

For  the  purposes  of  these  employment   warranties  alone,
"GRIMSBY  EMPLOYEES"  means  employees  of the Company who are
employed  at the  Grimsby  Site and  Grimsby  Site  means  the
Factory at Pyewipe Road,  details of which are set out in Part
1 Section 2 of Schedule 2.

For the  purposes of these  employment  warranties  "GRADE 37"
refers to a particular grade of employee, as determined by the
Company, using the Hay-MSL evaluation system.

F. PENSIONS
In this Part F: "SCHEME DOCUMENTS" means the documents relating to the
Scheme identified in the Grimsby Disclosure Letter.

(1)     Except  pursuant  to the  Scheme,  the  Company  has not paid,
provided  or  contributed   towards,  and  is  not  under  any
obligation  (whether  or  not  legally  enforceable)  to  pay,
provide or contribute towards any relevant benefit (as defined
in Section 612(1) of the Income and Corporation Taxes Act 1988
(referred  to in this Part F as  ICTA)),  payable  on death or
retirement for or in respect of any present or past officer or
employee (or any spouse, child or dependant of any of them) of
the Company.

(2)     The Scheme Documents comprise all the documents  governing the
Scheme including all explanatory booklets and announcements to
the employees  describing  the terms of the Scheme (other than
routine  benefit   statements)  of  current  effect  and  full
particulars of any  enhancement  of benefit and  contributions
payable to the Scheme and there is no obligation to provide or
continue to provide benefits in respect of employees or former
employees  of the  Company  under the  Schemes  other  than as
revealed in the Scheme Documents.

(3)     The Scheme is approved as an exempt  approved  scheme  (within
the  meaning of Chapter I of Part XIV of ICTA) and there is in
force  in  respect  of the  employments  to which  the  Scheme
relates an appropriate contracting-out certificate (within the
meaning of section 7 of the  Pension  Schemes Act 1993) and so
far as the Seller is aware nothing has been done or omitted to
be done which  will or may result in the Scheme  ceasing to be
approved as an exempt approved  scheme or the  contracting-out
certificate   in  respect  of  the  Scheme  being   cancelled,
surrendered or varied.

(4)     So far as the  Seller is aware,  the  Scheme  has at all times
complied  with  the  provisions  of  all  relevant   statutes,
regulations  and  requirements  and has been  administered  in
accordance  with the  trusts,  powers  and  provisions  of the
Scheme  and with due  regard to the  general  requirements  of
trust law and the  advisers  to the Scheme have not had and do
not have any cause to report any matter to OPRA.

(5)     So far as the Seller is aware, the Company has complied in all
material  respects with its  obligations  under the Scheme and
all  amounts  due to be  paid  to  the  Scheme  by it and  its
employees have been paid.

G. GRIMSBY PROPERTIES
(1)     The  Grimsby  Properties  constitutes  all of the  freehold or
leasehold  or other  immovable  property  owned by occupied or
used by the Company.

(2)     The particulars of the Grimsby  Properties shown in Schedule 2
to the Hivedown Agreement (including in the case of registered
land the class of title and title  number) are true,  complete
and correct. The use of the Grimsby Properties for the purpose
stated in Schedule 2 to the Hivedown Agreement  corresponds to
the use to  which  it is in fact  put or  (where  the  Grimsby
Properties is not presently in use) to the use to which it was
last in fact put.

(3)     The  Company  has a good and  marketable  title to the Grimsby
Properties for the estate or interest  stated in Schedule 2 to
the Hivedown Agreement,  free from any defects, and has in its
possession,  or under its control,  all duly stamped deeds and
documents  which are  necessary  to prove title to the Grimsby
Properties,  and such title has already been fully  deduced to
the Purchaser's Solicitors.

(4)     The Company does not require the use and is not in  occupation
of or  entitled  to any  estate  or  interest  in any  land or
premises  save for the Grimsby  Properties.  The Company is in
exclusive  occupation  of the whole of the Grimsby  Properties
and on  completion  shall be in  exclusive  occupation  of the
whole of the Grimsby Properties.

(5) The Grimsby  Properties  are not affected by any of the  following
matters:

(a) any   easement,   reservation,    covenant,   restriction,
agreement,    licence,   franchise,    mortgage,   charge,
encumbrance, or third party right;

(b) any notice, order, proposal, dispute or complaint relating
to it or its present use under any legislation, agreement,
covenant, condition, licence or consent; or

(c) outgoings  (other  than  uniform  business  rates,   water
charges and other standard  payments to the relevant water
company including, without limitation,  insurance premiums
and  other  usual   business   expenses),   whether  of  a
periodically  recurring  nature or  otherwise  and whether
payable by the owner or occupier of the relevant property.

(6)     All  obligations,   restrictions,   conditions  and  covenants
(including  any  imposed  by or  pursuant  to  any  lease  but
excluding  any referred to in paragraph  A.9 above)  affecting
the Grimsby  Properties has been observed and performed so far
as the Seller is aware and there are no subsisting allegations
of a breach of any thereof relating to the Grimsby  Properties
or its present use under any legislation, agreement, covenant,
condition,  licence or consent other than those referred to in
paragraph A.9 above by any competent authority or other person
or so far as the Seller is aware any circumstance  which might
give rise to such a breach.

(7)     The Grimsby  Properties are in a good and substantial state of
repair and  condition  and fit for the purposes for which they
are presently  used and the Company or the Seller has not used
in the Grimsby  Properties  any  substances  not in conformity
with  relevant  British  or  European  standards  or  codes of
practice or which are  generally  known to be  deleterious  to
health and safety  and there are no  uncompleted  works of any
description  at the  Grimsby  Properties  other  than  routine
maintenance.

(8)     There  are  no  subsisting  allegations  that  the  use of the
Grimsby Properties for the purpose stated in Schedule 2, Parts
I and II of the Hivedown  Agreement is not the permitted  user
under the provisions of all relevant  legislation  (including,
without limitation,  legislation  relating to town and country
planning  and health and  safety but  excluding  environmental
protection) or regulations  made under such  legislation or is
not in accordance with the  requirements of the local planning
and all other competent  authorities or that any restrictions,
conditions  and  covenants  imposed  by or  pursuant  to  such
legislation  have  not  been  observed  and  performed  and no
agreement  has been  entered  into under  section 106 Town and
Country Planning Act 1990 (or any similar statutory provision)
in respect of the Grimsby Properties.

(9)     The  copy  documents   disclosed  and  the  replies  given  by
Linklaters  & Paines to the  Purchaser's  Solicitors'  written
enquiries concerning the Grimsby Properties are true, complete
and accurate in all material respects.

(10)    The Company has no liabilities or contingent  liabilities (but
excluding  any matters  referred to in paragraph A.9 above) in
respect of any properties (other than the Grimsby  Properties)
(or any interest therein) whether by privity of contract or by
way of guarantee or surety or otherwise.

(11)    The  Grimsby  Properties  have  the  benefit  of  all  rights,
easements and consents  reasonably required for the occupation
and operation of such properties for their present use and any
plant,  machinery  and  processes  thereat  and  such  rights,
easements  and  consents  are  enjoyed  on terms  which do not
permit  them  to  be  determined  by  any  third  party  or by
effluxion of time.

(12)    There  are no  outstanding  liabilities  to make  payments  in
respect of rates, water charges,  or any other charges payable
in  respect of the  Grimsby  Properties  to any  governmental,
state, municipal or other similar authority.

H. INTELLECTUAL PROPERTY
(1)     So far as the Seller is aware,  the rights to be  licensed  to
the Company at Completion in respect of Intellectual  Property
and Technical  Information are all of those  considered by the
Seller to be necessary for the conduct of the Grimsby Business
by the Company as now conducted.

(2)     Except as set out in the Grimsby Disclosure Letter, the Seller
has not received actual notice of infringement by others or of
attacks  on  the  validity  of  or  on  the  Seller's  or  its
Affiliates title to any Intellectual Property used exclusively
in  the  Grimsby  Business.   The  Grimsby  Disclosure  Letter
identifies  the status of the relevant  patents and, so far as
the Seller is aware, whether or not such patents are currently
being opposed.

(3)     The Seller does not have actual knowledge and has not received
written  notification  that activities of the Grimsby Business
infringe  the  Intellectual  Property  of any third party (the
Seller  having no  obligation  to  conduct  investigations  in
relation to any such potential infringement).

(4)     So  far  as the  Seller  is  aware,  all  material  agreements
relating to Intellectual Property and Technical Information to
which the  Seller is a party and which  relate to the  Grimsby
Business are listed in the Grimsby Disclosure Letter.

I. BROKERS
Neither the Seller nor the Company has employed any investment banker,
broker or finder or incurred any  liability  for any  brokerage  fees,
commissions,  finders' fees or similar payments in connection with the
transactions contemplated by this agreement for which the Purchaser or
the Company may be liable.

J. THE COMPANY
As at the Completion Date, the Company has not carried on any business
or trade and has no liabilities or obligations  (actual or contingent)
except for (i) any  liabilities or obligations  assumed by the Company
pursuant  to the  terms  of the  Hivedown  Agreement  or any  document
entered  into  pursuant  thereto;  (ii) any  liability  to stamp  duty
arising  from  completion  of the  Hivedown  Agreement;  and (iii) any
liability  incurred in the  ordinary  course of the  Grimsby  Business
since the Transfer Time.

K. MILLENNIUM COMPLIANCE
(1)     For the  purposes  of this  agreement  "Millennium  Compliant"
means that the Computer  Systems are capable of the  following
functions before during and/or after 1 January 2000:

(a) handling  date  information  involving  all and any  dates
before,  during  and/or  after 1  January  2000  including
accepting date input, providing date output and performing
date calculations in whole or part;

(b) operating   accurately  without  interruption  on  and  in
respect of any and all dates before, during and/or after 1
January 2000 and without any change in performance;

(c) responding to and  processing two digit year input without
creating any ambiguity as to the century; and

(d) storing  and  providing  date  input  information  without
creating any ambiguity as to the century.

(2)     The Grimsby Disclosure Letter contains material details of the
measures  that  have  been  implemented   within  the  Grimsby
Business to determine the extent to which its Computer Systems
are not  Millennium  Compliant,  and  material  details of any
programme  undertaken  by the Grimsby  Business with a view to
its Computer Systems  achieving  Millennium  Compliance (or so
close to Millennium Compliance as is practicable).

L. INTRA-GROUP ARRANGEMENTS
(1)     Except  as  provided  for in the  Hivedown  Agreement  and any
document  entered  into  pursuant  thereto  and any  liability
incurred in the ordinary course of the Grimsby  Business since
the  Transfer  Time,  there is no  indebtedness  or  liability
(actual or contingent) nor any security owed by the Company to
any  member  of the  Seller's  Group or the ICI Group (in each
case as constituted  following  Completion) other than arising
in the  ordinary  course of business and as conducted on arm's
length terms.

(2)     Except  as  provided  for in the  Hivedown  Agreement  and any
document  entered  into  pursuant  thereto  and any  liability
incurred in the ordinary course of the Grimsby  Business since
the Transfer Time,  there is no agreement or contract to which
the Company is a party and to which any member of the Seller's
Group or the ICI Group (in each case as constituted  following
Completion)  is a  party  or  in  which  any  such  member  is
otherwise   interested  in  any  way  whatsoever  which  shall
continue beyond the Completion Date.

M. DEBTORS
(1)     The  Company  has not made,  or entered  into any  contract or
agreement to make any loan to, or other  arrangement with, any
person  as a result  of  which it is or may be owed any  money
other than trade  debts  incurred  in the  ordinary  course of
business and cash at bank.

(2)     The  Company  is not  entitled  to  the  benefit  of any  debt
otherwise  than as the original  creditor and has not factored
or discounted any debt or agreed to do so.

(3)     All of  the  debts  which  will  be  reflected  in  the  Final
Completion Statement (as defined in the Hivedown Agreement) as
owing to the Company (apart from bad and doubtful debts to the
extent  to which  they  have  been  provided  for in the Final
Completion   Statement)  will  realise  their  full  value  as
included in the Final Completion  Statement within the payment
terms agreed with the respective debtors.

SCHEDULE 4
PENSIONS
(CLAUSE 10)

1  DEFINITIONS

"ACTUARY'S  LETTER"  means the letter  from the Scheme  Actuary to the
Purchaser's Actuary attached to this agreement at Schedule 9.

"PAYMENT DATE" means the date on which payment is due under  paragraph
3.5.

"PURCHASER'S  SCHEME" means the Scheme  nominated  under paragraph 2.1
and, where the context requires, the trustees thereof.

"PRINCIPAL  EMPLOYER"  means  Tioxide  Group Limited until the date on
which it ceases to be the Principal  Employer of the Scheme and, after
that date, the Seller.

"SCHEME"  means  the  Tioxide  Pension  Fund and,  where  the  context
requires, the trustees thereof.

"TIMING ADJUSTMENT" has the meaning set out in the Actuary's Letter.

"TRANSFERRING  MEMBER" means a Grimsby Employee who is a member of the
Scheme on the  Completion  Date who  consents  to a transfer of assets
being made for him to the Purchaser's Scheme under paragraph 2.3.

"PURCHASER'S ACTUARY" means the actuary or firm of actuaries appointed
by the Purchaser for the purpose of this Schedule.

"SCHEME ACTUARY" means Graham Harman of Sedgwick Noble Lowndes Limited
or any other  actuary or firm of actuaries  appointed by the Principal
Employer for the purpose of this Schedule.

2  THE PURCHASER'S SCHEME

2.1  The  Purchaser  will,  on or  before  Completion  Date,  nominate  the
Purchaser's  Scheme  being a scheme which is a  contracted-out  and an
exempt  approved  scheme for the purposes of Chapter I Part XIV of the
Income and  Corporation  Taxes Act 1988 ("ICTA") or capable of being a
contracted-out  and exempt  approved  scheme and which is permitted by
its rules to receive  transfer  payments  in  respect of  Transferring
Members on the terms of this Schedule. The Purchaser will use its best
endeavours  to ensure that this does not change  after the  Completion
Date.

2.2  Unless a Grimsby Employee requests  otherwise within four weeks of the
Completion  Date, each Grimsby  Employee who is a member of the Scheme
immediately  before the  Completion  Date  shall join the  Purchaser's
Scheme with effect from the Completion  Date. Any Grimsby Employee who
has not become eligible to join the Scheme by the Completion Date will
be able to join the  Purchaser's  Scheme  on the  date he  would  have
become  eligible  to join the Scheme if it had  continued  to apply to
him.

2.3  The  Principal  Employer  and the  Purchaser  will use all  reasonable
endeavours to ensure that each Grimsby Employee who is a member of the
Scheme immediately before the Completion Date and who becomes a member
of the Purchaser's  Scheme is given the opportunity (in terms approved
by the Principal  Employer and the Purchaser,  such approval not to be
unreasonably  withheld),  of  consenting  within  eight  weeks  of the
Completion  Date to a transfer  of assets  being made for him from the
Scheme to the Purchaser's Scheme.

2.4  The  Purchaser's  Scheme will provide  benefits  and require  employee
contributions  in respect of each  Transferring  Member's service with
the Company from the Completion  Date which are comparable  with those
being  provided and required  under the Scheme and on a basis which is
substantially  no less favourable  overall (to the satisfaction of the
Principal  Employer's  Actuary)  than the basis on which  benefits are
being provided  immediately  before Completion for (and  contributions
required from) the Transferring Members under the Scheme.

3  TRANSFER PAYMENT FROM SCHEME

3.1  The Principal  Employer will use reasonable  endeavours to ensure that
on the  Payment  Date  the  trustees  of the  Scheme  transfer  to the
Purchaser's  Scheme  an  amount  equal to the  value  of the  benefits
payable  under the  Scheme in  respect  of the  Transferring  Members'
service  before the  Completion  Date  calculated as at the Completion
Date on the bases set out in the Actuary's Letter ("TRANSFER AMOUNT"),
with the adjustments set out below.

3.2  The  Transfer  Amount  will be  adjusted  by  reference  to the Timing
Adjustment for the period between the Completion Date and the close of
business  on the day before  the date on which  payment is made to the
Purchaser's Scheme.

3.3  The Transfer Amount as adjusted by paragraph 3.2 will be calculated by
the Scheme  Actuary and agreed by the  Purchaser's  Actuary  within 14
days of the  Scheme  Actuary  notifying  the  Transfer  Amount  to the
Purchaser's Actuary.

3.4  Payment  to the  Purchaser's  Scheme  will be  made  on the  following
conditions:

3.4.1   that the Inland Revenue has given its consent to the making of
the payment;

3.4.2   the Purchaser has complied  with all its  obligations  in this
Schedule;

3.4.3   the Transfer Amount has either been agreed under paragraph 3.3
or determined under paragraph 6;

3.4.4   the trustees of the  Purchaser's  Scheme have  confirmed  that
they will accept the payment on the terms set out in paragraph
4.

3.5  Payment  to  the  Purchaser's  Scheme  (adjusted  in  accordance  with
paragraph 3.2) is due on the later of the following:

3.5.1   3 months after the Completion Date; and

3.5.2   14 days  after  the date  when the last of the  conditions  in
paragraph 3.4 has been satisfied.

3.6  The  Principal  Employer  and the  Purchaser  will use all  reasonable
endeavours to secure agreement  between the Scheme and the Purchaser's
Scheme  respectively  as to the  particular  assets to be  transferred
representing  the  amount  due.  If  agreement  is not  reached by the
Payment Date, the transfer will be in the form of assets of the Scheme
listed on the London  Stock  Exchange  and selected by the Trustees of
the Scheme as a representative selection of such listed assets held by
the  Scheme.  To the extent that any part of the amount due is paid in
cash,  the amount due will be reduced by two per cent.  Any securities
to be transferred  will be valued at the mid-market price at the close
of business on the relevant  stock exchange on the day before the date
of transfer.

3.7  If the  trustees  of  the  Scheme  do  not  pay  the  Transfer  Amount
calculated and adjusted in accordance  with  paragraphs 3.2 and 3.6 in
full on the  Payment  Date,  the  Principal  Employer  will pay to the
Purchaser the amount of the difference  ("SHORTFALL") less the rate of
corporation tax current at the date of payment.  If they make a larger
transfer  payment to the  Purchaser's  Scheme than the Transfer Amount
adjusted in accordance with paragraphs 3.2 and 3.6, the Purchaser will
pay the amount of the  difference to the  Principal  Employer less the
rate of corporation tax current at the date of payment.

3.8  No  payment  shall  be due from the Principal Employer pursuant to 3.7
above:

3.8.1   if the reason  for the  payment  not  having  been made to the
Purchaser's Scheme by the expiry of the time limit referred to
above is the failure of the  Purchaser's  Scheme for  whatever
reason to accept  the whole or any part of the  payment  or if
the  reason is any other  reason  outside  the  control of the
Trustees  of the  Scheme  but,  if no  payment is due from the
Principal  Employer  because of any such other reason  outside
the control of the Scheme, payment will become due (subject to
the other  provisions  of this  paragraph  3) if and when such
reason ceases to exist;

3.8.2   unless the  Purchaser  undertakes  in writing to the Principal
Employer to pay the  Shortfall  forthwith  to the  Purchaser's
Scheme  and to  procure  that such  amount be  applied  by the
Purchaser's  Scheme to provide  benefits for the  Transferring
Members in respect of their pensionable  service in the Scheme
before the Completion Date as mentioned in paragraph 4.

4  BENEFITS  TO BE  PROVIDED  BY THE  PURCHASER'S  SCHEME IN  RESPECT  OF
SERVICE UNDER THE SCHEME

4.1  The Purchaser  shall procure that the pension  entitlements  under the
Purchaser's  Scheme in respect of any member of the Purchaser's Scheme
who:

4.1.1   was  a  member of the Scheme immediately before the Completion
Date;

4.1.2   has not  consented  to a transfer of assets being made for him
from the Scheme to the Purchaser's Scheme; and

4.1.3   who dies after the  Completion  Date, but before the last date
on which he is able to give such consent under the  invitation
referred to in paragraph 2.3.

will be augmented.  The  augmentation  will be such that the amount of
the widow's or widower's and any child's or dependant's  pension which
is payable in respect of such member from the Purchaser's Scheme shall
be increased so that the total of such benefits  payable in respect of
such member under the Scheme and the  Purchaser's  Scheme shall be the
same as that which  would have been  payable  had that  employee  died
while in service immediately before the Completion Date.

4.2  The  Purchaser  will  ensure  that  the  Purchaser's   Scheme  accepts
liability  for  each   Transferring   Member's  accrued  rights  to  a
guaranteed  minimum  pension and accrued rights under section 9(2B) of
the Pension Schemes Act 1993 and provides  benefits in respect of such
payment in accordance with  regulations  made under Sections 12C or 20
of that Act.

4.3  The Purchaser will ensure that the Purchaser's  Scheme  credits,  with
effect from the Completion Date, each  Transferring  Member with final
salary type benefit  overall at least equal in value, as determined by
the Scheme Actuary with the agreement of the Purchaser's  Actuary,  to
those applying for and in respect of him under the Scheme  immediately
before the Completion  Date. For this purpose  benefits will be valued
under both schemes on the basis of the assumptions and methods set out
in the  Actuary's  Letter.  If the  trustees of the Scheme  notify the
trustees of the Purchaser's Scheme that a specified part of the assets
transferred for a particular  Transferring  Member relates to benefits
not calculated by reference to pensionable service, the Purchaser will
ensure that he is entitled to equivalent benefits under its scheme.

5  NO ASSISTANCE

The  Purchaser  agrees  that  neither  it  nor  the  Company  nor  the
Purchaser's  Scheme will take any action or provide any  assistance to
any person  (direct or  indirect)  which might or would  result in any
claim being made against the  Trustees of the Scheme or the  Principal
Employer,  or in the Scheme  transferring a smaller or a larger amount
than the amount payable under paragraph 3.1 to the Purchaser's Scheme.

6  DISPUTES

In the event that the Scheme Actuary and the Purchaser's Actuary shall
not agree any matter on which their  agreement is required  under this
Schedule,  the matter may be referred upon the  application  of either
the  Principal  Employer or the  Purchaser to an  independent  actuary
appointed  by the  President  for the time being of the  Institute  of
Actuaries on the  application of either the Principal  Employer or the
Purchaser.  That actuary shall determine the matter in accordance with
this Schedule (including the Actuary's Letter) acting as an expert and
not as an arbitrator and his decision shall be final and binding.  His
expenses  shall be borne  equally by the  Principal  Employer  and the
Purchaser  unless he makes a  recommendation  that they shall be borne
otherwise.

7  VOLUNTARY CONTRIBUTIONS

Nothing previously  contained in this Schedule will apply to voluntary
contributions or to benefits secured by them.  However,  the Principal
Employer  will use  reasonable  endeavours  to ensure  that the assets
representing  Transferring  Members'  voluntary  contributions will be
transferred to the Purchaser's  Scheme,  and the Purchaser will ensure
that in that  event  its  scheme  provides  benefits  for the  members
concerned equal in value to the assets transferred.

SCHEDULE 5
IMPLEMENTATION AGREEMENTS
(SUB-CLAUSE 1.1)

1.1  Service Agreement for transitional IT arrangements  between the Seller
(or an Affiliate of the Seller) and the Company

1.2  Service  Agreement (Eutech)  between  ICI (or an Affiliate of ICI) and
the Company

2 Product Exchange Agreement between TEL and the Company

3  Deed of  Guarantee  (to include a guarantee  given by the  Purchaser's
ultimate  parent  undertaking in respect of the Company's  obligations
under the Hivedown Agreement)

4  Transfers of the legal  interests in respect of the  Nettleton  Bottom
Quarry and  Killingholme  properties in favour of the Purchaser or any
of its Affiliates

SCHEDULE 6
ENVIRONMENT
(CLAUSE 11)

1  INTERPRETATION

For the purposes of this Schedule 6, words and expressions  defined in
the Share Sale  Agreement to which this  Schedule 6 is attached  shall
have the  same  meaning  in this  Schedule  6 and,  in  addition,  the
following terms shall have the following meanings:

"COMMERCIALLY  REASONABLE EXPENSES" are those costs and expenses which
a reasonable  person acting in a commercially  prudent manner,  taking
into account (but without  imposing an absolute  requirement) the need
to  minimise  his  expenditure,  would  expend,  in  the  case  of any
obligation to carry out the remediation of Environmental Contamination
pursuant  to  Environmental  Laws,  to meet that  obligation.  For the
avoidance of doubt, Commercially Reasonable Expenses shall not include
any costs or expenses to the extent that they are incurred as a result
of the adoption or imposition of standards of clean-up materially more
stringent than those which are provided for under Environmental Laws;

"CONTROLLED WATERS"  means  waters  including  any  ground  or surface
waters;

"COUNTER INDEMNITY" means the indemnity defined in paragraph 3.1;

"EA  PROVISIONS"  means Part II and paragraphs 161 and 162 of schedule
22 of the  Environment Act 1995 as enacted at Completion and the first
complete set of regulations and guidance under those provisions except
(in the event that they are not already in issue at Completion) to the
extent  that  any of  the  above,  when  they  come  into  force,  are
materially more onerous than the versions of such provisions which are
enacted or exist in draft form as at Completion;

"ENVIRONMENT"  means air,  Controlled Waters,  land (whether on, in or
below such land, excluding any buildings or other permanent structures
on, in or below the land) but  including the surface of any river bed,
the  surface  of any sea bed or any other land  covered by water,  and
flora and fauna and all other natural resources;

"ENVIRONMENTAL   CONTAMINATION"   means  any   discharge,   transport,
emission,  release, leakage, spillage, escape or disposal of Hazardous
Material  at or  from  the  Site(s)  onto  or  into  any  part  of the
Environment;

"ENVIRONMENTAL  LAWS" means any and all  legislation  (whether  civil,
criminal or administrative),  statutes,  treaty, statutory instrument,
directive  bylaw or judgment  (including  any judgment by the European
Court of Justice),  regulations,  notices orders government  circular,
code of  practice,  and  guidance  note or decision  of any  competent
regulatory  body or common law relating to pollution or  protection of
the  Environment  which as at Completion  are in effect and capable of
enforcement  by legal  process in the country in which the Site(s) are
situated,  save that the EA Provisions  shall be deemed to be in force
at Completion;

"ENVIRONMENTAL LIABILITIES" means all claims, costs, damages, expenses
(including reasonable professional fees incurred), losses, liabilities
(including  without limitation  liability to third parties),  fines or
penalties  suffered or incurred by the Company,  the  Purchaser or its
Affiliates (or the Seller or its Affiliates in the case of the Counter
Indemnity)  as a  direct  consequence  of or in  connection  with  any
Environmental Proceeding;

BUT  EXCLUDING  any  claims,   costs,   damages,   expenses,   losses,
liabilities:

(i) in respect of capital  expenditure  on plant and equipment
other   than   capital   to  carry  out   remediation   of
Environmental   Contamination  pursuant  to  Environmental
Laws;

(ii)in respect of loss of anticipated  profits,  loss of
revenue, or any other loss in respect of business
interruption;

(iii)where   applicable  to  the  extent  that  they  are  not
Commercially Reasonable Expenses;

"ENVIRONMENTAL PROCEEDING" means:

(i) subject  to (ii)  below any writ  and/or  interim or final
judicial or administrative decree,  judgment,  injunction,
order, or notice;

(a)  under  which  the  Company  the   Purchaser   or  its
Affiliates  (or the Seller or its  Affiliates  in the
case  of  the  Counter   Indemnity)  are  obliged  by
Environmental  Laws  or  legal  process  pursuant  to
Environmental  Laws to  undertake  or pay the cost of
remediation  or with which the aforesaid  parties are
otherwise obliged to comply; or

(b)  as a result of any violation or alleged  violation of
Environmental Laws; or

(c) as a result pursuant to Environmental Laws of:

(aa)any personal  injury to any third party (and,  in
the  case  only of the  Indemnity  other  than to
officers  or  employees   of  the  Company,   the
Purchaser and its Affiliates and any  contractors
or agents of the  Company,  the  Purchaser or its
Affiliates  save  to the  extent  in the  case of
personal  injury  (other  than   asbestos-related
personal   injury)  after   Completion  that  the
Purchaser  neither knew nor  reasonably  ought to
have known of the  circumstances  giving  rise to
such personal injury); or

(bb)damage to any  property  of any third party (and,
in the case only of the Indemnity other than as a
result of damage after Completion to the property
of any officers or employees of the Company,  the
Purchaser or its Affiliates  and any  contractors
or agents of the Purchaser or its Affiliates save
to the  extent,  in the case of damage  occurring
after  Completion the Purchaser  neither knew nor
reasonably   ought   to   have   known   of   the
circumstances   giving  rise  to  the  damage  to
property);

(ii)any agreement between the Seller and Purchaser,  or in the
event of disagreement  any  determination  by the Experts,
that it is Reasonably  Necessary to undertake  remediation
of  Environmental  Contamination  which  would but for the
fact that an  environmental  authority is unaware of it be
more  likely  than  not  to  result  in  an  environmental
authority  bringing  an  Environmental   Proceeding  under
(i)(a) in the definition of  Environmental  Proceeding and
which would result in Environmental Liabilities;

"HAZARDOUS MATERIAL" means hazardous poisonous, dangerous, noxious, or
toxic substances, pollutants or wastes;

"INDEMNITY" means the indemnities contained in paragraph 2 below;

"OFF SITE DISPOSAL  TIPS" means any  properties  used as a landfill or
otherwise  for the deposit of waste which are located  anywhere  other
than on sites  which sites at or any time prior to  Completion  are or
have been used for  manufacturing  or other operations of the Company,
the Seller and/or its Affiliates;

"REASONABLY NECESSARY" means reasonably necessary to avoid or avert or
mitigate the development of substantial adverse and material pollution
of the  Environment  or harm to human health which will arise within a
period of six months; and

"SITES(S)"   means  the   Grimsby   Properties   (including,   without
limitation, Off Site Disposal Tips).

2  INDEMNITY

2.1  Subject to the provisions of this agreement,  the Seller undertakes to
the Purchaser (for the benefit of the Company,  the Purchaser and each
of its  Affiliates)  that it will  indemnify  and  hold  harmless  the
Company, the Purchaser and each of its Affiliates against:

2.1.1   all Environmental  Liabilities arising at or from the Site(s),
to the extent that such Environmental Liabilities are a result
of   Environmental   Contamination   occurring  on  or  before
Completion; and

2.1.2   all  costs,  damages  expenses,  losses,  fines  or  penalties
suffered or incurred  by the Company or the  Purchaser  or its
Affiliates  as a  result  of  any  prosecutions  commenced  or
proceedings   taken,   or  notices   served  or  other  formal
enforcement  action  between  [DATE OF  SIGNATURE  OF THE 1998
FRAMEWORK  AGREEMENT]  1998 and  Completion  by any  competent
regulatory  body in connection  with the Environment or health
and safety as a result of any  breaches  of any  Environmental
Laws related to the  operation of those Sites which are owned,
occupied or used by the Company at [DATE OF  SIGNATURE  OF THE
1998  FRAMEWORK  AGREEMENT]  1998. For the avoidance of doubt,
damages  in  this   paragraph   2.1.2   includes  any  capital
expenditure reasonably required to remedy such breaches; and

2.2  notwithstanding  paragraphs 2.1 above and 4.1 below neither the Seller
nor any of its  Affiliates  shall be  liable  under the  Indemnity  or
otherwise  to  the  extent  that  such  liability  arises  from  or is
attributable  to the failure of the Purchaser to comply or procure the
Company's  compliance  with the  provisions of paragraphs 4.2 and 5 to
14.

3  THE COUNTER INDEMNITY

3.1  The Purchaser  undertakes to the Seller (for the benefit of the Seller
and each of its  Affiliates)  that,  subject to the provisions of this
agreement,   it  will   indemnify  and  hold  harmless  (the  "Counter
Indemnity") the Seller and each of its Affiliates from and against all
Environmental  Liabilities  arising  at  or  from  the  Site(s)  after
Completion save to the extent that such Environmental Liabilities fall
within the Indemnity.

3.2  Notwithstanding   sub-paragraph  3.1  above,  the  Purchaser  and  its
Affiliates  shall  not be  liable  to the  Seller  under  the  Counter
Indemnity or otherwise to the extent that such  liability  arises from
or is  attributable  to the  failure of the Seller to comply  with the
provisions  of  paragraphs  3.3,  4.2, 6-8, 10, 11, 12.1, 13 and 14 of
this Schedule.

3.3  The Seller  shall take all  reasonable  steps to avoid or mitigate any
Environmental  Liabilities  and  potential  Environmental  Liabilities
which  may give  rise to a claim  under  or in  connection  with  this
Counter Indemnity, howsoever arising.

3.4  The provisions of paragraphs 4.2 and 12.1 shall apply equally  mutatis
mutandis  in  respect  of the  Seller  and the  Purchaser's  rights or
obligations in respect of the Counter Indemnity.

4  LIMITATIONS

4.1  Neither the Seller nor any of its Affiliates shall be liable under the
Indemnity to the extent that  Environmental  Liabilities  have arisen,
been increased, exacerbated, enhanced or caused as a result of any act
or omission  whether direct or indirect of the Company,  the Purchaser
or any  Affiliates,  employees,  agents or  contractors  thereof after
Completion  (including,  without limitation,  any change of use of the
Site(s) which for the avoidance of doubt shall include  closure of all
or any part of the Sites but shall not include any material  change of
process  within the existing  plant  and/or  buildings or any material
change to or development of the business and operations  carried on at
any Site  which  does not  result  in any Site or any part of any Site
ceasing  to be used  for  general  industrial/manufacturing  of a type
materially  similar  to the  existing  Site  operation  and  the  word
"omission" as used in this paragraph 4.1 shall not mean any failure by
the Company or  Purchaser  to carry out  remediation  or  preventative
action in circumstances where it is not within their power to do so or
where the  Purchaser  is not aware or could not  reasonably  have been
aware of the  Environmental  Liabilities in question or where (without
prejudice to the  obligations of the Purchaser  under paragraph 5) the
rights of the Purchaser to bring a claim under the Indemnity  would be
prejudiced as a result thereof.

4.2  No  claim  may  be  made  by  the  Purchaser  for  any   Environmental
Liabilities under this Indemnity against the Seller to the extent that
any Environmental Liabilities arise:

4.2.1   as a result directly or indirectly of information  voluntarily
given  by  the   Purchaser  or  the  Company  (but  only  post
Completion  in  the  case  of  the  Company)  to a  regulatory
authority  in  circumstances  other  than  where  there  is  a
mandatory  reporting  requirement under  Environmental Laws or
where  information  is given as  required  in the  context  of
applications for or variations to authorisations, licences and
other forms of environmental  consent required by the business
in the  course  of the  Company's  or the  Purchaser's  normal
business   activities  or  where  the  Seller  has  previously
proposed or approved this course of action in writing; and

4.2.2   from any  admission of liability  by a  representative  of the
Purchaser  holding a rank not less  than  that of Senior  Vice
President in respect of any  clean-up  which needs to be done,
except where the Seller has approved such admission in writing
such approval not to be unreasonably withheld or delayed.

4.3  No claim against the Seller or its  Affiliates  under the terms of the
Indemnity  for any  Environmental  Liabilities  shall be valid  unless
notice has been served on the Seller in accordance with the provisions
of paragraph 7 within 10 years of Completion.

4.4  The  Seller's  liability  under  the  Indemnity  shall be  limited  in
accordance  with the  provisions  of Clause 5,  except for  sub-Clause
5.14.2 (save for the proviso to sub-Clause  5.14) and sub-Clause 5.15,
the subject matter of which will be governed by the provisions of this
Schedule.

4.5  In the event that the  Indemnitor (as defined in paragraph 6.1) either
incurs external charges, costs and expenses for environmental services
or internal charges for its own environmental services, in either case
including but not limited to testing and/or analytical services and/or
contaminated  soil  disposal  facilities,  in  connection  with  or in
relation to any actual or potential  Environmental  Liabilities  under
the Indemnity or Counter Indemnity (as appropriate) then such external
charges,  costs and expenses shall be deemed to be payments made under
the  Indemnity or Counter  Indemnity  (as  appropriate).  Any internal
charges shall be made on the same basis as the  Indemnitor  charges to
its own business or its Affiliates.

4.6  It is hereby expressly agreed that, save where the Seller has accepted
liability  or  becomes   otherwise  liable  under  the  terms  of  the
Indemnity,  all  costs  incurred  by the  Purchaser  in  carrying  out
environmental  analyses  and tests of the Site(s)  (and its (or their)
surrounds) shall be borne by the Purchaser.

4.7  The   Seller   shall  be   liable   under   the   Indemnity   for  any
asbestos-related  personal  injury  unless and to the extent  that any
works  carried out by the  Purchaser or its  Affiliates or the Company
after  Completion,  were not carried out by a reputable  contractor or
contractors,  who were duly and  properly  authorised  or  approved to
undertake  such  works  to at  least  the  standards  of the  relevant
federal,  state or other  regulatory  authorities  published  by or in
operation (in  accordance  with good  industry  practice) at all times
during the carrying out of such works.

5  MITIGATION

The  Purchaser  shall take all  reasonable  steps after  Completion to
avoid or  mitigate  any  Environmental  Liabilities  and/or  potential
Environmental  Liabilities to the extent it is within the  Purchaser's
power to do so, which may give rise to a claim under or in  connection
with this  Indemnity  howsoever  arising.  Such steps will include but
shall not be limited to:

5.1  carrying out (where  reasonably  practicable)  appropriate  soil tests
before  taking  any  action  which  is  likely  to  cause  a  material
disturbance to soil;

5.2  where reasonably practicable carrying on its activities on the Site(s)
so as to minimise  disturbance  to known areas of existing or probable
soil contamination (other than deliberate removal of such contaminated
soil)  without  incurring  abnormal  unusual or  excessive  cost in so
doing;

5.3  the Purchaser  (with the approval of the Seller not to be unreasonably
withheld  or  delayed)  settling  a claim of any party  (not  being an
Affiliate of the Purchaser) which will or may fall within the terms of
the Indemnity,  the costs and expenses associated with such settlement
(so  approved  by  the  Seller)  being  deemed  to  be   Environmental
Liabilities for the purposes of this  agreement)  provided always that
nothing in this paragraph 5.3 shall oblige the Purchaser to enter into
any settlement which it does not, in its sole discretion,  consider to
be in the best interests of its operations;

5.4  making  reasonable  and timely  efforts to pursue  claims  against any
third parties (including  insurers) who may have some liability to the
Purchaser  in respect of the matter in question  provided  always that
this  shall  not  limit  or  restrict  or  operate  in  any  way  as a
pre-condition  to the rights of the  Purchaser  to make a claim  under
this Indemnity; and

5.5  using  reasonable  endeavours to avoid acts or omissions of the nature
described in paragraph 4.1.

6  NOTIFICATION

6.1  As soon as reasonably  practicable after either party becomes aware of
any actual or potential Environmental  Liabilities which may give rise
to a claim  by it  under  the  Indemnity  or  Counter  Indemnity  (the
"Claimant") (whether or not the Claimant is of the opinion that it has
a valid claim  against the other party under the  Indemnity or Counter
Indemnity (the  "Indemnitor"))  the Claimant shall give written notice
thereof to the  Indemnitor  (and  thereafter  will keep the Indemnitor
fully informed of all material  developments  relating thereto).  Such
written  notice shall  include all  material  details of any actual or
potential   Environmental   Liabilities   (including   the  Claimant's
reasonable   estimate   of  the  extent  of  and,   where   reasonably
practicable, the cost of remediation of the Environmental Liabilities,
as a result thereof).

6.2  Neither party shall admit,  settle or discharge any claim or liability
which might  constitute a claim  against the other under the Indemnity
or Counter  Indemnity (as  appropriate)  without having first served a
notice  under  this  paragraph  6 and  given  the  other a  reasonable
opportunity  to  consider  the  circumstances  referred to in the said
notice.

7  CLAIMS

In the event  that the  Claimant  wishes to make a claim  against  the
Indemnitor  under the Indemnity or Counter  Indemnity (as appropriate)
then it shall do so by  giving  notice in  writing  of the same to the
Indemnitor  giving such details as are then in its  possession  of the
relevant subject matter of such claim.

8  CONDUCT

If any notice is received by either party under  paragraphs 6 or 7 the
Claimant shall if so requested by the Indemnitor  take all steps which
are necessary and reasonable to avoid, resist,  appeal,  compromise or
defend any claim and any adjudication in respect thereof,  (subject to
the Claimant being indemnified against all cost and expenses which may
reasonably and  necessarily  be incurred in connection  therewith) and
the Indemnitor shall (subject to the provisions of this paragraph), at
its request,  be allowed to conduct any  negotiations,  proceedings or
appeals  incidental  thereto PROVIDED ALWAYS that if the claim relates
to or arises from a Site which at the time is owned,  occupied or used
by the  Company  and which is  operational  at the date of the  notice
under  paragraph  7 then  the  Purchaser  shall  have  conduct  of all
negotiations,  proceedings  or appeals  incidental  thereto  but shall
nonetheless   keep  the  Seller   fully   informed  of  all   material
developments relating to the subject matter of the claims.

9  SITE ACCESS

If any notice is received by the Seller under paragraphs 6 or 7:

9.1  the Seller  and/or its  agents and  contractors  shall be free to have
access to any  Site(s)  to the  extent  it is within  the power of the
Company,  the  Purchaser or its  Affiliates,  during  normal  business
hours, and after reasonable prior notice, and, if so required,  in the
presence of an  authorised  representative  of the Purchaser to assess
(including but not limited to assessment by soil sampling and testing)
the  extent  of  the   Environmental   Liabilities   and/or  potential
Environmental  Liabilities  and to  determine  the action  required in
order to remediate  such  liabilities;  (such actions to be subject to
the prior agreement of the Purchaser (including as to the action to be
taken) such agreement not to be unreasonably withheld) and

9.2  the Purchaser shall (during normal business hours) allow the Seller or
its agents access to inspect and take copies of such books and records
of the business of the Company  and/or the  Purchaser  relating to the
Site(s)  as may be  necessary  in  connection  with any  Environmental
Liabilities and/or potential Environmental Liabilities.

10  DISCUSSIONS

Upon either  party  having  given a notice  under  paragraphs  6 or 7,
either the Seller or the  Purchaser  may  request a meeting as soon as
practicable  to discuss  the matter  (and if either  does so the other
party shall comply  promptly with such request) and,  irrespective  of
whether there has been any agreement on liability, each party shall be
fully involved in any discussions  and/or  negotiations with any party
imposing or seeking to impose any Environmental Liabilities.

11  DISPUTE RESOLUTION

Upon either party giving a notice in accordance  with  paragraph 7, in
the  event  that the  Seller  and the  Purchaser  are  unable to agree
promptly any factual  matter  relevant to a claim under this Indemnity
or Counter  Indemnity  (as  appropriate)  or in the event of any other
matter being referred to the Experts in accordance  with this Schedule
6 then the following provisions of this paragraph 11 shall apply:

11.1  a reputable independent firm of experts (the "Experts") (who shall act
as  experts  and  not  arbitrators)  in  relation  to the  Environment
relevant to the claim or  potential  claim  (having at least ten years
relevant  experience)  shall be appointed  by mutual  agreement of the
parties  hereto  (and the  parties  shall each be obliged to use their
respective  best endeavours to reach agreement as soon as practicable)
to resolve any factual  matter in dispute  between the parties but not
including any  interpretation  of laws or regulations as they apply to
such factual matters or any conclusions  regarding  responsibility  or
liability for or in relation to any factual matters. The Experts shall
be offered  the  appointment  within 15  Business  Days of the parties
reaching such mutual agreement and shall be notified in writing of the
provisions of sub-paragraph 11.7 below.  Failing such mutual agreement
on the  appointment  of Experts,  the parties shall promptly refer the
issue, at their joint cost, to the President for the time being of the
Royal  Institute  of Chartered  Surveyors  in the United  Kingdom with
instructions to appoint  suitable Experts within fourteen (14) days of
receipt of such instructions;

11.2  the said Experts  shall only be  dismissed by the mutual  agreement of
the parties hereto;

11.3  both parties  shall  promptly and  simultaneously  exchange  with each
other and submit to the Experts,  and in any event in accordance  with
the Experts'  written  directions,  their arguments and submissions in
connection  with any matter of fact referred to him in accordance with
this paragraph 11;

11.4  following  receipt by the Experts of the written  arguments  and other
submissions  of the parties  pursuant to paragraph  11.3,  the parties
shall   instruct  the  Experts  to  issue,   as  soon  as   reasonably
practicable, a formal written opinion pertaining to the matter of fact
referred to them.  In any event the  Experts  shall be  instructed  to
present the said opinion  within two months of  receiving  the written
arguments and other  submissions of the parties  pursuant to paragraph
11.3;

11.5  the formal written opinion of the Experts issued pursuant to paragraph
11.4 shall be conclusive in any proceedings between the parties hereto
as to the question of fact so determined;

11.6  the fees and  expenses  of the Experts  shall be borne  equally by the
Seller and the Purchaser (unless  otherwise  directed by the Experts);
and

11.7  the Experts, and any company,  firm, partnership or other organisation
with which the  Experts  are  connected  shall not be  eligible  to be
considered  to undertake any clean-up work in respect of the claim for
which  they have so acted on or around  the  Site(s),  save  where the
parties  hereto  mutually  agree  to  waive  this  provision.  For the
avoidance  of doubt,  either  party may  withhold  such consent in any
event.

12  ACCEPTANCE OF LIABILITY

In the event that the Seller  admits that it has any  liability to the
Purchaser  under the  Indemnity  (or where the Seller agrees to accept
the Purchaser's claim as falling within the Indemnity  notwithstanding
the fact that no  Environmental  Liability  may at that  point in time
have arisen):

12.1  the Seller shall have the right  independently  to determine  whatever
measures are appropriate in order to remediate  pursuant to applicable
Environmental Laws the subject matter of the claim under the Indemnity
and furthermore the Seller shall have the right independently to carry
out such remediation itself (or through suitable third party agents or
contractors)  provided that in so doing the Seller (or its said agents
or contractors) shall be obliged to use reasonable endeavours to avoid
causing  undue  interruption  to the  conduct of the  business  of the
Company and/or the Purchaser;

12.2  the Seller and/or its agents and contractors shall, in addition to the
rights of access  provided for in  paragraph 9 above,  be free to have
access to the Site(s) if currently owned,  leased or, where within the
power of the Company and its Affiliates  during normal  business hours
after reasonable prior notice, and if so required,  in the presence of
an  authorised  representative  of the  Purchaser,  to  carry  out the
remediation referred to in paragraph 12.1 above.

13  STATEMENTS

In the event of any circumstances arising which do or may give rise to
Environmental  Liabilities  which  may fall  within  the  terms of the
Indemnity  or the  Counter  Indemnity  (as  appropriate)  neither  the
Company,  Purchaser  nor  the  Seller  (nor  any of  their  respective
Affiliates)  shall  make any  public  statements  (including,  for the
avoidance of doubt, any statement to any regulatory authority,  unless
required  by  law or in an  emergency)  regarding  such  circumstances
without  first  discussing  with the other party and reaching  written
agreement (such agreement not to be unreasonably  withheld or delayed)
on the text of any such public statement before it is made.

14  GENERAL

14.1  Any  information,  records,  or other  material  of one party shall be
treated as strictly  confidential by the other party except when it is
required  to be used in order to comply  with an order of the court or
regulatory  authority  or it is used by the other party to enforce its
rights under this Schedule 6 or so as to make an insurance claim.

14.2  The Purchaser's and its Affiliates'  exclusive  remedies in respect of
any claims  which fall within the scope of the  Indemnity  shall be in
accordance  with the  provisions of this Schedule 6, and the Purchaser
on  behalf  of  itself  and its  Affiliates  hereby  waives  all other
remedies whether in contract,  tort  (including,  for the avoidance of
doubt,  negligence),  or howsoever otherwise arising which it may have
against  the  Seller or any of its  Affiliates  at law or in equity in
respect of the matters  which fall  within the scope of the  Indemnity
and, for the  avoidance of doubt,  if such a claim under this Schedule
could also give rise to a Claim or a claim  under any other  provision
of this agreement in respect of the same subject matter, the Purchaser
may only bring a claim under this Schedule 6.

14.3  The Seller  undertakes to co-operate with the Purchaser and assist the
Purchaser in achieving a transfer to the  Purchaser (or as it directs)
of all Environmental Authorisations,  permits and licences held by the
Seller at Completion.

15  CO-OPERATION

The Purchaser undertakes that wherever co-operation is required by the
Company  to  ensure   compliance  with  the  Purchaser's   obligations
hereunder,  the Purchaser will use its reasonable endeavours to ensure
that the Company provides the requisite co-operation.

SCHEDULE 7
(SUB-CLAUSE 1.7)

David Allen
David Busby
David Croft
Peter Davidson
Colin Deas
Rachel Draper
Martin  Hinnigan
Garry  Hodgson
John  Jackson
Rob Louw
Ian Machin
Mahomed Maiter
Michael Maughan
Chris Milross
David Porter
David  Rochester
Matthew Rose
Mike Wardropper
Peter Waugh
David Williams

SCHEDULE 8
GRIMSBY FINANCIAL INFORMATION
(SUB-CLAUSE 1.1)

GBP millions

Fixed Assets                            74.46

Investments                                 -

Stocks                                  11.18

Operating Debtors                        1.65

Non Operating Debtors                       -

Operating Creditors
less than 1 year                        (8.88)

Non Operating Creditors
less than 1 year                       (0.51)
--------
77.90
--------

Net Debt                                    -

Provisions                                  -

Deferred Tax                                -
--------
-

SCHEDULE 9
ACTUARY'S LETTER
(Schedule 4)

ANNEX 1
(SCHEDULE 3 A.10)

DATA ROOM DOCUMENTS

GRIMSBY

ENVIRONMENTAL

CONSENTS
IPC Consents: 8.1.1/01, 8.5/05, 8.1.1/20, 18/29

Waste Disposal Consents: 1.1.1/196, 1.1.1/92, 8.3/21, 8.1.1/02,
8.1.1/03

Discharge Consents: 1.1.1/212

Water Abstraction Licences: 1.1.1/56, 1.1.1/57, 1.1.1/82

Radioactivity Licences: 8.1.1/12

REPORTS
8.2.3,  8.8.3/01,  8.3/01,  8.3/02,  8.3/03,  8.3/04,  8.6/02, 8.6/01,
8.6/03,  8.10/03,  17/03, 8.14/01,  8.7/01,  8.3/06,  8.3/11,  8.3/12,
8.3/17, 8.12/02, 8.12/03, 8.13/03, 8.3/23, 8.3/16, 8.8.1/01, 8.8.2/01,
8.2/01

REPLIES
18.35,  8.1.1/19,  18/15,  8.1.1/17,  8.3/27, 8.3/29, 8/02, 1.1.1/215,
18/54, 18/14, 18/52, 18/32, 18/36, 8.8.3/02,  8.8.3/03, 18/05, 8.6/01,
8.3/30, 18/07, 18/28

IP

3.1/01                Technology Transfer Agreement between TGL, TGI,
TGSL and EI Du Pont de Nemours

3.1/02                Name Agreement  between TEL, TAI and EI Du Pont
de Nemours

3.1/03                Name Agreement  between TGL, TCI and EI Du Pont
de Nemours

3.1/04                Name Agreement between TEL, TGL, TGSL and EI Du
Pont

3.1/05                Assignment and Substitution  Agreement  between
TGL,  TGSL,  EI Du Pont de Nemours  and Company
and ICI

3.1/06                Patent and Know-how  Licence between TCI and EI
Du Pont

4.2/01                Note on Barnburgh IT Systems dated 26/3/98 from
Ian Machin Tioxide Group IT Manager

4.3/05                Grimsby IT Systems Map

4.3/06                Tioxide UK IT Systems Map

4.6/01                Audit Report on Grimsby Site following a review
of compliance with Millenium Programme

4.6/02                Millenium Compliance - Grimsby

4.3/07                Standard  Software  Licence  for  OSI  software
(Factory Information Systems)

4.3/11                Agreement  between  Tioxide  Europe  and  Aspen
Technology  in  relation  to  Calciner  Control
software

5.20/02               Response  -  Grimsby   Information   Technology
structure and employee details

PENSIONS

6.1/07                Response to  questions  re:  Pension Fund (Ref:
No. P6)

18/06                 Response to Question P1 relating to the Tioxide
Pension Fund

EMPLOYMENT

5.1/01                Principal Terms and conditions of Employment

5.1/30                Colin Deas Employment Contract

5.3/02                List of  contractors  with  which  Tioxide  has
agreed rates

5.16/03               List of all current  employee  claims (Ref: No.
LIT5)

5.30/01               List  of  Grimsby  leadership  team  and  staff
members

10.1/05               Details of UK personal  injury claims  relating
to Grimsby (current and archived)

CONTRACTS

2.1/02                Agreement  between  British  Railways Board and
Tioxide    Europe   for   the    movement    of
non-hazardous chemical gypsum waste by rail.

2.1/47                Contract  between  (1)  Tioxide  Group Plc (now
Tioxide Group Ltd) as agent for Tioxide  Europe
SA (Spain) and (2)  Westralian  Sands Ltd.  for
the supply of ilmenite.

2.1/50                Agreement  between  Tioxide Group  Services Ltd
and [ ] for the supply of copperas.

18/19                 Agreement for sale of gypsum to major contract
customer.

TAX

1.2.2/01              Details of tangible  assets with a  depreciated
value in excess of (pound)100,000.

PROPERTY

1.1.1/146             Land  Certificate  of  Great  Coates,  Grimsby.
Title number HS98246 - Proprietor being Tioxide
Europe UK Ltd together with plan

18/13                 Response to Question 0P1 relating to the use of
the  Landfill  Site on  Humber  Road

1.1.1/197             Licence   between   Associated   British  Ports
("ABP") and Tioxide  Europe  Limited  regarding
land at the south west corner of Immingham Dock
of 5.1 acres, dated 15 November 1991

POTENTIAL LITIGATION

10.1/01               Correspondence with Knauf re: potential dispute

10.1/02               Summary of a potential claim by AAF Ltd

10.1/03               Summary of a potential claim against Thomas
Broadbent & Sons Ltd

10.1/04               Summary of a potential claim by Knauf

10.1/06               Summary of potential personal injury claim

10.1/11               Latest correspondence with Knauf

MISCELLANEOUS

18/03                 Response  to   NL/Kronos   questions  on  North
American streaming and capability

5.12/04               Description  of industrial  accidents  1995 and
1996

5.12/02               List of industrial accidents 1996 - 1998

5.16/02               List  of  estimated   claims   settlements  for
1993-1997 claims

1.2.2/01              Details of Tangible  Assets with a  depreciated
value in excess of GBP100,000

5/02                  Grimsby & E A West  Response  re:  breakdown of
manufacturing costs

18/02                 Requested financial information

18/37                 Response  -  analysis  of debtor  and  creditor
balances for Grimsby and E A West

18/62                 Variable  selling  cost from  Grimsby  Works to
America

8.2/02                Schedule of Grimsby Car Damage Claim

18/21                 Response  to Q.F9  relating  to  neutralisation
costs

SIGNATURES

SIGNED by                        }
for and on behalf of
TIOXIDE EUROPE LIMITED

SIGNED by                        }
or and on behalf of
N L INDUSTRIES, INC

EXHIBIT 10.5

PRODUCT EXCHANGE AGREEMENT

BETWEEN

NEWCO, LTD.

AND

TIOXIDE EUROPE, LTD.

INDEX

ARTICLE     TITLE

1.              DEFINITIONS
2.              SUPPLY OF PRODUCTS
3.              QUANTITIES AND FORECASTS.
4.              ORDER AND DELIVERY
5.              PRODUCT IMBALANCES
6.              QUALITY, ADJUSTMENTS
7.              TERM AND TERMINATION
8.              WARRANTY
9.              CLAIMS
10.             REMEDY
11.             PATENT WARRANTY
12.             NO CONSEQUENTIAL DAMAGES
13.             FORCE MAJEURE
14.             ALLOCATION
15.             GOVERNMENT ACTION
16.             USER PROTECTION AND PRODUCT INFORMATION
17.             LABELING AND LITERATURE, NAME ON PRODUCT
18.             TAXES, INTEREST, VAT, IMPORT DUTIES
19.             CONFIDENTIAL INFORMATION
20.             DISPUTE RESOLUTION
21.             ASSIGNMENT
22.             NO AGENCY AND NO PARTNERSHIP
23.             ENTIRE AGREEMENT/AMENDMENTS/SEVERABILITY
24.             WAIVER
25.             NOTICES
26.             GOVERNING LAW
27.             COVENANT NOT TO COMPETE
28.             ASSURANCES

SCHEDULE  "A" -  TIOXIDE  FINISHED  PRODUCTS
SCHEDULE  "B" - NEWCO  FINISHED PRODUCTS
SCHEDULE "C" - TIOXIDE CALCINER  DISCHARGE  PRODUCTS
SCHEDULE "D" - NEWCO  CALCINER  DISCHARGE  PRODUCTS
SCHEDULE "E" - CUSTOMER  LIST  (SULFATE PRODUCTS)
SCHEDULE "F" - CUSTOMER LIST (TC4)

PRODUCT EXCHANGE AGREEMENT

This  Product  Exchange  Agreement  ("Agreement")  is  entered  into  this
_________day  of  _________,  1998,  by and  between  NEWCO,  Ltd.  ("Newco")  a
corporation incorporated in England and Wales and Tioxide Europe, Ltd., ("TEL"),
a corporation of the United Kingdom for the purpose of exchanging  Products,  as
defined herein and specified in the attached Schedules, collectively referred to
herein as the "parties" or singularly as "party" and each party hereto variously
referred to as the "supplying  party" or the  "receiving  party" as the case may
be.

Whereas, TEL, an Affiliate of DuPont, holds one-hundred percent of the
shares of stock of Newco; and,

Whereas, the primary asset of Newco is the titanium dioxide
manufacturing plant located at Grimsby, U.K. (the "Grimsby Plant"); and

Whereas,  concurrent  with the execution of this  Agreement,  Purchaser is
acquiring the Tioxide North American titanium dioxide business; and

Whereas,  concurrent with the execution of this Agreement,  TEL has agreed
to sell the whole of the issued share capital in Newco,  to Purchaser to provide
Purchaser and its Affiliates with manufacturing  capacity to support Purchaser's
North American business; and

Whereas,  the Products  currently sold in North America  include  specific
products  not  currently  manufactured  by Newco and the parties  wish to ensure
continued  availability  of the Products while Newco and its  Affiliates  expand
their  product  range to ensure  continuity  and while  the  customers  for such
Products carry out the necessary trials to approve Products newly  manufactured;
and

Whereas,  the Products  currently sold by the Grimsby Plant are desired by
TEL (and its Affiliates) for sale in Europe for a limited period of time; and

Whereas, TEL (and its Affiliates) and Newco (and its Affiliates) therefore
wish, for a limited period of time, to exchange as between one another equal, or
close to equal  quantities  of the Products  specified  below for no  additional
consideration other than the Products  themselves,  or as otherwise specified on
the terms and subject to the conditions contained herein; and

Whereas,  the  parties  intend  to  minimize  both the total  quantity  of
products  exchanged  and the  duration of the  exchange so as  independently  to
supply the needs of each  company's  own  customers  at or before the end of the
Contract Period; and

Whereas,  the parties  recognize  that  imbalances may result in one party
hereto not  receiving  the same quantity of Product that said party is supplying
to the receiving party; and

Whereas, the terms contained herein are, among other things,  developed to
address said Product  Imbalance as defined below in  furtherance of the goals of
this Agreement;

NOW  THEREFORE,  the  parties  hereto  agree to enter  into  this  Product
Exchange Agreement on the terms set forth below:

1.    Definitions:

In this Agreement,  including the attached Schedules,  the recitals,
words and expressions shall have the following meaning:

"Affiliates"  shall have the same  meaning as set forth in the Share
Purchase and Sale Agreement  between TEL and Purchaser  dated  __________,  1998
relating to the sale and  purchase of the whole of the issued  share  capital of
Newco.

"Business  Day(s)"  means a day (other than a Saturday or Sunday) on
which banks are generally open for normal  business in each of London,  Montreal
and New York.

"Calciner Discharge Products" means the Newco Calciner Discharge
Products or the Tioxide Calciner Discharge Products or generally both as the
case may be.

"Calciner   Discharge  Product   Imbalance"  means  at  any  Product
Imbalance Date any difference in quantity between the Calciner Discharge Product
received  by TEL and the  Calciner  Discharge  Product  received by Newco in the
period  since  the  later  of (1) the  Completion  Date or (2) the  most  recent
preceding  Product Imbalance Date for which the Product Imbalance has been cured
or eliminated pursuant to Subclauses 5.1.4 through 5.1.6, as the case may be.

"Calciner  Discharge  Product Value" means an amount in U.S. dollars
determined by  calculating  the sum of the average  per-metric-ton  full cost of
manufacturing  Calciner  Discharge  Products  experienced  by the Tioxide  Group
during its 1997 accounting year plus a 2.5% manufacturing margin, such sum to be
escalated  annually  on December  31 each year by the  increase/decrease  in the
Retail  Prices  Index  for  such  year  as  published  by H.M.  Government,  and
multiplying  such escalated sum by the relevant total number of tons of Calciner
Discharge Products.

"Completion  Date" as used in this Agreement has the same meaning as
that  set  forth  in the  Share  Purchase  and Sale  Agreement  between  TEL and
Purchaser.

"Contract  Period" means the period beginning on the Completion Date
and ending two (2) years thereafter (subject to early termination under Clause 7
of this Agreement).

"Delivery Point" means the supplying party's plant.

"DuPont" means E. I. du Pont de Nemours and Company., a U.S.
(Delaware) Corporation.

"Finished Products" means the Newco Finished Products or the Tioxide
Finished Products or generally both as the case may be.

"Finished  Product  Imbalance" means at any Product Imbalance Date ,
any difference in quantity between the Finished Products received by TEL and the
Finished  Products  received  by Newco in the period  since the later of (1) the
Completion  Date, or (2) the most recent  preceding  Product  Imbalance Date for
which the Product Imbalance has been cured or eliminated  pursuant to Subclauses
5.1.4 through 5.1.6, as the case may be.

"Finished Product Value" means an amount in U.S. dollars  determined
by calculating the sum of the average  per-metric-ton full cost of manufacturing
Finished  Products  experienced by the Tioxide Group during its 1997  accounting
year plus a 2.5%  manufacturing  margin,  such sum to be  escalated  annually on
December 31 each year by the  increase/decrease  in the Retail  Prices Index for
such year as published by H.M. Government, and multiplying such escalated sum by
the relevant total number of tons of Finished Products.

"Force Majeure" has the meaning set forth in Paragraph 13 of this
Agreement.

"Newco CD  Product  Imbalance"  means a Calciner  Discharge  Product
Imbalance  occurring  because  Newco  receive a quantity of  Calciner  Discharge
Product from TEL that is greater than the quantity of Calciner Discharge Product
received by TEL from Newco.

"Newco  Calciner  Discharge  Products"  means the Products listed in
Schedule  "D" meeting  the  Specifications,  being all those  grades of calciner
discharge  produced at the Grimsby  Plant (U.K.) during the three years prior to
the Completion Date for subsequent treatment to become Finished Products.  These
Products will be produced by Newco solely at the Grimsby Plant (U.K.)
during the term of this Agreement.

"Newco FP  Product  Imbalance"  means a Finished  Product  Imbalance
occurring because Newco received a quantity of Finished Product from TEL that is
greater than the quantity of Finished Product received TEL from Newco.

"Newco Finished  Products" means the products listed in Schedule "B"
meeting  the  Specifications,  being  those  Finished  Products  produced at the
Grimsby Plant (U.K.) during the three years prior to the Completion  Date. These
Products will be produced by Newco solely at the Grimsby Plant (U.K.)
during the term of this Agreement.

"Newco Products" means the Newco Calciner Discharge Products and
the Newco Finished Products, collectively.

"Packaging  Materials"  means  all  materials  used to  package  the
Products,  including,  but not  limited  to,  all  bags,  containers  and  other
materials  that are  reasonably  necessary  to package the  Products at the time
title passes in accordance with Clause 4.3.

"Product"  means the  Calciner  Discharge  Products or the  Finished
Products,  as the case may be. "Products" means the Calciner  Discharge Products
and the Finished Products, collectively. As used in this Agreement, "Product" or
"Products" may refer to Product or Products produced by the "supplying party" or
received by the "receiving party", or generally both, as the context requires.

"Product Imbalance" means the Calciner Discharge Products
Imbalance or the Finished Products Imbalance.

"Product  Imbalance  Date"  means any one of:  (1) the date one year
following the Completion  Date, (2) the date of the end of the Contract  Period,
or (3) the date of termination of this Agreement pursuant to Subclause 7.2.

"Purchaser" means NL Industries, Inc., a U.S. (New Jersey)
corporation.

"Quality" means, for a given Product grade, a set of values
described within the Specifications.

"Specification(s)" means the standard specifications of the Products
on the day prior to the  Completion  Date or as amended by  agreement in writing
between  the  parties  hereto.   For  a  given  Product  grade,   such  standard
Specifications may describe one or more Quality.

"Tioxide CD Product  Imbalance" means a Calciner  Discharge  Product
Imbalance  occurring  because  TEL  received a quantity  of  Calciner  Discharge
Product  from Newco that is greater  than the  quantity  of  Calciner  Discharge
Product received by Newco from TEL.

"Tioxide Calciner  Discharge  Products" means the products listed in
Schedule  "C" meeting  the  Specifications,  being all those  grades of calciner
discharge  produced by TEL or its  Affiliates  for  transfer  to North  American
during the three years prior to the Completion Date for subsequent  treatment to
become  Finished  Products.  These  Products  will  be  produced  by  TEL or its
Affiliates  during  the  term of this  Agreement  at the  former  (ICI)  Tioxide
manufacturing plants.

"Tioxide FP Product  Imbalance" means a Finished  Product  Imbalance
occurring because TEL received a quantity of Finished Product from Newco that is
greater than the quantity of Finished Product received by Newco from TEL.

"Tioxide  Finished  Products"  means the products listed in Schedule
"A" meeting the Specifications, being those Finished Products sold by Tioxide or
an Affiliate  in North  America  during the three years prior to the  Completion
Date. These Products will be produced by TEL or its Affiliates  solely at former
(ICI) Tioxide manufacturing plants during the term of this Agreement.

"Tioxide Products" means the Tioxide Calciner Discharge Products
and the Tioxide Finished Products, collectively.

"Value" means the Calciner Discharge Product Value and the
Finished Product Value.

2.    Supply of Products.

2.1 During the  Contract  Period,  TEL agrees to deliver to Newco or
Newco's Affiliates and Newco (or Newco's Affiliates,  as the case may be) agrees
to accept from TEL the quantity of Tioxide  Calciner  Discharge  Products and of
Tioxide Finished Products as determined in accordance with Clause 3.

2.2 In consideration of the Tioxide Calciner  Discharge Products and
the Tioxide Finished  Products  supplied pursuant to Subclause 2.1, Newco agrees
to  deliver to TEL and TEL agrees to accept a like  quantity  of Newco  Calciner
Discharge Products and Newco Finished Products.

2.3 In consideration  of any Calciner  Discharge  Product  Imbalance
and/or Finished Product  Imbalance that may occur pursuant to Subclauses 2.1 and
2.2,  the  parties  agree  to  cure  such  Product  Imbalance  according  to the
provisions of Clause 5.

2.4 For Product  supplied  according to Subclauses  2.1 and 2.2, the
grade,  package  type  and  Quality  will be  determined  by the  provisions  of
Subclauses 3.2 through 3.6.

3.    Quantities and Forecasts.

3.1  Based on  current  requirements,  the  parties  agree  that for
Tioxide Products delivered to Newco:

(a) the total quantity of Tioxide Calciner  Discharge Products
listed in Schedule C shall not exceed 25,000 metric tonnes;

(b) the total quantity of Tioxide Finished  Products listed in
Schedule A, Part 1 shall not exceed 55,000 metric tonnes;

(c) the total quantity of Tioxide Finished  Products listed in
Schedule A, Part 2 shall not exceed 1,000 metric tonnes; and

(d) the total  quantity of Tioxide  Products  shall not exceed
75,000 metric  tonnes or such lesser  amount  specified in the
forecast provided by Newco pursuant to Subclause 3.2;

during any period of 12 consecutive months within the Contract Period. All Newco
forecasts  will be for product to be made available by TEL at the Delivery Point
for receipt by Newco.  If these  quantities  are not  sufficient to meet Newco's
needs, the parties will negotiate in good faith to establish new limits.

3.2 Within fifteen (15) days after the Completion  Date, Newco shall
provide to TEL a 12-month  forecast  by month for the total  quantity of Tioxide
Product  needed by  specifying a quantity for each grade,  Quality,  and package
type.

3.3 Within ten (10) days after receipt of Newco's forecast  pursuant
to Subclause  3.2,  TEL will  provide a 12-month  forecast by month for the same
total quantity of Newco Product to be supplied to TEL, specifying a quantity for
each grade, Quality and package type.

3.4 The forecasts  provided  pursuant to Subclauses 3.2 and 3.3 will
be updated  monthly  on a 12-month  rolling  basis by each  receiving  party and
provided:

(a)  first  from  Newco  to TEL by the  5th  day of the  month
preceding the first month of each updated forecast, and

(b) then  from  TEL to  Newco  by the  10th  day of the  month
preceding the first month of each updated forecast.

3.5 On receipt of the reciprocal demand forecasts  provided pursuant
to Subclause 3.4, each supplying  party will promptly assess its ability to meet
the  forecast.  If any potential  problem is foreseen,  the parties will in good
faith promptly discuss the problem, mutually agree on a resolution, and finalize
the  forecast  by the 15th day of the month  preceding  the first  month of each
updated forecast.

3.6 Each forecast  provided  according to Subclauses 3.2 - 3.4 shall
be  non-binding  and for  planning  purposes  only  and  does  not  represent  a
commitment by the supplying  party to deliver and the receiving  party to accept
delivery of any quantity of Product, except that for each such forecast:

3.6.1  Month  1  requirements  shall  be a fixed  and  binding
commitment  by the  receiving  party  to  accept  delivery  of
Product quantities by grade, Quality and package type.

3.6.2  Months  2 and 3 shall be  variable  by plus or minus 5%
both for total quantity and for  quantities by grade,  Quality
and package type,  but are otherwise  binding on the supplying
party and the receiving party.

3.7 The  parties  will adjust  forecasts  for Months 4 through 12 in
each rolling  forecast in a good faith attempt both to meet the  requirements of
Subclause 3.1 and to ensure that the total  quantity of Tioxide  Products and of
Newco Products are equal at the end of each full year of the Contract Period.

3.8 Each forecast shall also report the total quantities of Calciner
Discharge Product and of Finished Product supplied and received during each full
year following the Completion Date, so as to enable the parties to calculate any
Product Imbalances.

3.9 All  exchanges  of  information  pursuant  to this  Clause 3 are
subject to Clause 19.3 "Confidential Information".

4.    Order and Delivery.

4.1 The receiving  party shall place all orders for Product from the
supplying party according to commercially reasonable procedures specified by the
supplying  party at least  forty-five  (45) days  before  the date of  requested
delivery, except that:

4.1.1 During the first month  following the  Completion  Date,
the parties will  cooperate to maintain  continuity  of supply
for orders  placed prior to the  Completion  Date for delivery
during that first month; and

4.1.2 By mutual  agreement,  the  parties may waive the 45-day
lead time to help minimize or avoid a Product Imbalance.

4.2 All orders from the receiving  party shall be for full container
quantities with each container loaded to the maximum  allowable weight compliant
with legal weight  restrictions  and physical  property  restrictions  and in no
instance more than two (2) grade and package type  combinations  per  container.
The receiving  party shall be  responsible  for providing such  containers.  The
supplying party will make good faith efforts to avoid package damage  associated
with loading products of dissimilar  package size. The supplying party will have
no liability for package damage in the case of containers with more than one (1)
grade of product type where such package damage has been caused by the inclusion
of two (2) grade and package type combinations per container.

4.3 All Product will be supplied by the supplying party: "Ex Works".
All title and risk for the Product  shall pass to the  receiving  party when the
product is  accepted  for  loading  and  shipment  at the  Delivery  Point.  The
receiving party shall bear all costs of transportation,  freight,  duties, taxes
and related  costs and is  responsible  for the  logistics of  transporting  the
Product.

4.4  Product  will be  delivered  by  supplying  party in  Packaging
Materials provided by the receiving party at the cost of the receiving party.

4.4.1  Packaging  Materials will be available to the supplying
party  for its use at the  relevant  Delivery  Point  at least
sixty (60) days in advance of any delivery  date in sufficient
quantity  to allow  supplying  party to meets its  commitments
hereunder.

4.4.2 All  Packaging  Materials  will  display  the  receiving
party's  name,  trademark(s),   if  any,  and  other  relevant
information  for use by the supplying  party in fulfilling the
receiving party's requests for Product.

4.4.3  Any   failure  to  supply   Product   due  to  lack  of
availability  of proper  Packaging  Materials will be deemed a
failure  of  receiving   party  to  perform  its   obligations
according to the  provisions of this Agreement and will not be
a failure of the  supplying  party to perform its  obligations
according  to the  provisions  of this  Agreement,  unless the
supplying  party is solely  negligent for lack of availability
of proper Packaging Materials.

4.4.4 During the first one hundred eighty (180) days following
the Completion Date or until  sufficient  Packaging  Materials
are provided by the  receiving  party,  whichever  shall first
occur,  the  supplying  party shall  utilize its own Packaging
Materials,  with  associated  costs  to be  reimbursed  by the
receiving  party.  Receiving  party shall be  responsible  for
re-labeling in accordance with Subclause 4.4.2.

4.5  All  Product  made  available  by  the  supplying   party,   in
satisfaction of an order from receiving party,  will be promptly  transported by
receiving party from the Delivery Point.

4.6 Product will be made available  throughout the delivery month in
accordance with the supplying party's monthly production schedule.

4.7 The parties will use  reasonable  efforts to cooperate  with one
another in providing any necessary  documentation to support these  transactions
and any subsequent shipments or exports contemplated hereunder.

4.8 The parties acknowledge that:

(a)   This  Agreement is of short  duration  and designed  solely to
facilitate  the  intent  of  the  parties   described  in  the
Recitations,

(b)   There are no  significant  or material  differences  among the
financial values of the Products listed in Schedules A and B,

(c)   There are no  significant  or material  differences  among the
financial  values of the Products  listed in Schedules "C" and
"D", and

(d)   Circumstances  relating  to  documentation,  customs,  duties,
taxation,  or other legal  requirements  may  necessitate  the
assignment  of a financial  value to a particular  quantity of
Product.

The parties  therefore agree that where required as in Subclause 4.8
(d), the Calciner  Discharge Product value and the Finished Product value at the
time of  delivery  to the  Delivery  Point  shall be  deemed  to be equal to the
Calciner Discharge Product Value and the Finished Product Value, respectively of
such Product, and shall not be applied differently to either Tioxide Products or
Newco Products.

5.    Product Imbalances.

5.1 If a Product  Imbalance  should occur, the parties will promptly
cure such Product Imbalance under the following terms:

5.1.1 The "Newco Imbalance  Value" for such Product  Imbalance
shall be the sum of:

(1) The Calciner Discharge Product Value of the Newco
CD Product Imbalance, if any; and

(2) The Finished Product Value of the Newco FP
Imbalance, if any.

5.1.2 The "Tioxide Imbalance Value" for such Product Imbalance
shall be the sum of:

(1) The Calciner Discharge Product Value of the
Tioxide CD  Product Imbalance, if any; and

(2)  The  Finished  Product  Value  of  the  Tioxide  FP
Imbalance, if any.

5.1.3 Newco,  if the Newco  Imbalance Value is larger than the
Tioxide  Imbalance  Value,  or TEL, if the  Tioxide  Imbalance
Value  is  larger   than  the  Newco   Imbalance   Value  (the
"Reimbursing  Party")  shall be  responsible  to reimburse the
other party (the "Reimbursed Party") in an amount equal to the
net of the larger of the Newco Imbalance Value and the Tioxide
Imbalance  Value less the smaller of the Newco Imbalance Value
and the Tioxide Imbalance Value (the "Net Imbalance Value").

5.1.4 The  Reimbursing  Party will  reimburse the  Reimbursed
Party by (a)  supplying a quantity of  Finished  Product,  (b)
supplying a quantity of Calciner Discharge Product, and/or (c)
making a cash  payment,  such that the sum of (1) the Value of
such  Finished  Product,   (2)  the  Value  of  Such  Calciner
Discharge  Product,  and (3) the  amount  of the cash  payment
shall be equal to the Net Imbalance Value.

5.1.5 For any  Product to be supplied  pursuant  to  Subclause
5.1.4,  (a) the  Reimbursing  Party  shall  specify  the total
quantity and (b) the  Reimbursed  Party shall specify  whether
the  Product  will be Calciner  Discharge  Product or Finished
Product. The cash payment will be adjusted accordingly.

5.1.6 The  calculations,  determinations,  and decisions to be
made in  Subclauses  5.1.1.  through  5.1.5 will be  completed
within  thirty  (30)  days of the  occurrence  of the  Product
Imbalance and any cash payment will be made by the Reimbursing
Party within fifteen (15) days thereafter.

5.1.7 For any  Product to be supplied  pursuant to  Subclauses
5.1.4 and  5.1.5,  the  Reimbursed  Party  shall  specify  the
Product  grade(s),  Quality and package type,  and the parties
will mutually agree upon delivery timing.

5.1.8  For any  cash  payment,  VAT  shall be  charged  to the
Reimbursed Party as appropriate.

5.2 Any quantities of Product supplied and cash payments made by the
Reimbursing  Party  pursuant to Subclause  5.1.4  through 5.1.6 will be excluded
from consideration in the determination of any later Product Imbalance.

5.3 The provisions of this Agreement  relating to Product Imbalances
shall not apply where any Product  Imbalance  has been caused by a Force Majeure
event or circumstance, except to the extent that :

(a) at or near the end of the Contract  Period the  corrective
measures of Subclauses  13.2 or 13.3 are  sufficient to remove
what would  otherwise be a  contribution  of the Force Majeure
event to a Product Imbalance, or

(b) the party  not  declaring  a Force  Majeure  elects  under
Clause  13.3(b) to continue to receive  Product  during  Force
Majeure.

5.4 The parties'  obligation to cure Product Imbalances  pursuant to
Clauses 5.1 and 5.2 shall survive termination of this Agreement.

6.    Quality, Adjustments:

There  will  be no  change  in the  specifications  of  the  Product
produced by the  supplying  party  without the  express  written  consent of the
receiving  party.  The supplying party shall give sufficient prior notice to the
receiving  party of any  significant  change(s) in raw materials,  manufacturing
processes,  or test methods for mutual  assessment of the probable effect on the
receiving  party's  Product  performance.  Final Product  attributes will remain
unchanged and will be consistent with the Specifications.

7.    Term and Termination.

This Agreement  shall become  effective on the  Completion  Date and
terminate at the end of the Contract Period.

7.1  Clauses  5, 8, 9, 10,  11,  12,  15 and 19 shall  survive
termination of this Agreement.

7.2 If both  TEL and  Newco  reach  agreement  at the  time of
submission of any rolling  twelve-month  forecasts  that their
respective  needs for  Products  for all future  months  after
Month 2 of the  forecast  will be zero,  then in that case the
Contract Period will be deemed to end at the end of such Month
2 for the purposes of this Agreement.

8.    Warranty:

Each supplying  party warrants to each receiving party only that any
Product when supplied will meet the Specifications  for the Product.  EXCEPT FOR
THE FOREGOING AND AS EXPRESSLY PROVIDED HEREIN, SUPPLYING PARTY MAKES NO EXPRESS
OR  IMPLIED  WARRANTY   (INCLUDING,   WITHOUT  LIMITATION,   THE  WARRANTIES  OF
MERCHANTABILITY,  FITNESS FOR A PARTICULAR PURPOSE OR FROM ANY COURSE OF DEALING
OR TRADE USAGE)  REGARDING  THE PRODUCT.  Receiving  party  assumes all risk and
liability  for  results  obtained  by the use of the  supplying  party  Product,
whether used alone or in combination with other materials.

9.    Claims:

9.1 With respect to either Tioxide  Products or Newco  Products,  no
claim shall be greater in amount than the Value of the  Product  (plus  freight,
duty and disposal  costs)  exchanged  hereunder in respect of which  damages are
claimed except in the case of willful breach of this Agreement.  Failure to give
notice of a claim within one hundred eighty (180) days from date of delivery, or
the date fixed for delivery (in case of non-delivery), shall constitute a waiver
by the  receiving  party of all claims in respect of the Product so delivered or
not  delivered,  as the case may be except in the case of willful breach of this
Agreement. No Product shall be returned to the supplying party without supplying
party's  permission,  which shall not be unreasonably  withheld or delayed,  and
then only in the  commercially  reasonable  manner  prescribed  by the supplying
party.  No claim  shall be allowed  for Product  that has been  processed  (e.g.
"finished") in any manner.  Claims include,  without  limitation,  claims of any
kind, whether or not (a) for loss,  damage,  expense or injury, (b) with respect
to the Product  delivered or for  non-delivery of the Product,  or (c ) based on
supplying  party's  breach  of  warranty,   contract,   statute,  regulation  or
negligence, strict liability or any tort.

9.2 No Claim for failure to deliver on time or at all, will be valid
if the reason for said late delivery or  non-delivery  is the failure  either in
whole or in part, by the receiving  party to provide the supplying  party with a
sufficient  quantity of  Packaging  Materials  for the  Products  ordered by the
receiving party.

10.   Remedy:

Except in the case of willful  breach of this  Agreement,  a party's
exclusive  and sole remedy for any claim  shall be the  recovery of the Value of
the Product  exchanged  with the other party (plus  freight,  duty and  disposal
costs) in the transaction  giving rise to the claim. Such recovery may be in the
form of cash or in the form of Product at the  discretion  of the party  against
whom the claim is made.

11.   Patent Warranty:

The  supplying  party  warrants that the use or sale of the Products
delivered  hereunder  will not infringe the claims of any validly  issued patent
covering the Products themselves,  but does not warrant against infringement due
to: (a) the use of the  Products in  combination  with other  Products (or third
party products of other  manufacturers)  or materials or in the operation of any
process,  or (b) the  compliance  by  supplying  party  with any  specifications
provided to supplying party by the receiving party.

12.   No Consequential Damages:

Neither  party shall be liable for  special,  indirect,  incidental,
punitive or consequential  damages (including,  without limitation,  damages for
loss of business profits,  business  interruption or any other loss), whether or
not caused by, or  resulting  from,  the  negligence  of such party even if such
party has been advised of the possibility of such damages.

13.   Force Majeure:

13.1 Force Majeure is an event or circumstance beyond the reasonable
control of the party  claiming the Force  Majeure  including but not limited to:
act of God,  fire,  flood,  explosion,  hurricane,  breakdown  of  machinery  or
equipment, governmental action or inaction or request of governmental authority,
accident,  strike,  lockout, labor trouble or shortage,  inability to obtain raw
material,  power, equipment or transportation,  but the party claiming the Force
Majeure shall be diligent in attempting to remove such cause or causes and shall
promptly  notify  the  other  party of its  extent  and  probable  duration.  No
liability  shall  result to  either  party  from  delay in  performance  or from
non-performance  caused by a Force  Majeure  other than that  described  in this
Clause 13 and in Clause 14 and this Agreement shall remain otherwise unaffected.

13.2 If the party declaring a Force Majeure is the supplying  party,
the receiving party shall be entitled to reduce its own quantity commitments (by
grade,  Quality,  and package of such receiving  party's  choice) as a supplying
party in an amount equal to the quantity by which the non-performing party fails
to  perform.  The  non-performing  party  shall have no  obligation  to purchase
quantities  of  Product  from other  sources to enable it to perform  under this
Agreement.

13.3 If the party declaring a Force Majeure is the receiving  party,
the supplying party will be entitled:

(a) to reduce its own  commitments as a receiving  party in an
amount equal to the quantity by which the non-performing party
fails to perform, or

(b) to continue  to receive  Product  from the  non-performing
party.

13.4 In  order  to  claim  a  Force  Majeure  hereunder,  the  party
attempting to excuse its delay in performance or non-performance must notify the
other party  within 24 hours of  obtaining  knowledge  of the Force  Majeure and
confirm the Force Majeure event in writing within 5 Business Days thereafter. If
the  other  party  does not  agree  that the  event or  circumstance  is a Force
Majeure,  that  party  may  dispute  the  claim  under  the  Dispute  Resolution
provisions contained herein.

13.5 YEAR 2000  ISSUE.  A delay in  performance  or  non-performance
attributable to improper processing, management, manipulation, miscalculation or
misreading of data by  computer-operated  systems  arising out of processing for
the year 2000 shall not constitute a Force Majeure.

14.   Allocation:

14.1 If a Force Majeure event or  circumstance  occurs which results
in the failure of the supplying party to supply Product to the receiving  party,
supplying  party  will  distribute  its  available  supply  pro rata  (based  on
deliveries  in the three  calendar  months prior to the Force  majeure  event or
circumstance)  between  the  receiving  party  and the  aggregate  of all  other
purchasers,  including,  third  parties as well as  divisions,  joint  ventures,
business units, affiliates and subsidiaries of supplying party, for the duration
of such Force Majeure event or circumstance without liability for any failure of
performance  that  may  result  therefrom.   For  the  avoidance  of  confusion,
distribution  among  such  other  purchasers  will be made on such  basis as the
supplying party may deem fair and practical after first  determining the portion
to be provided to receiving party.

14.2 If a  non-Force  Majeure  event or  circumstance  occurs  which
results in the failure of the supplying party to supply Product to the receiving
party according to the forecast commitments hereunder, the supplying party shall
meet all of its supply  obligations under this Product Exchange  Agreement prior
to,  and in  preference  over,  any  other  supply  obligations  to  purchasers,
divisions,  joint  ventures,  business  units,  affiliates and  subsidiaries  of
supplying party.

15.   Government Action:

If any Government action should place or continue limitations on the
terms of this  Agreement  such that it would be  illegal  or  against  public or
Government  policy for  supplying  party to receive full value (i.e.  equivalent
exchanged  product) for its Product,  supplying party shall have the option: (a)
to continue to perform under this  Agreement  subject to such  adjustments  that
supplying party may deem necessary to comply with such Government action; (b) to
revise this Agreement,  subject to receiving party's written approval,  in order
to most nearly  accomplish  the  original  intent of this  Agreement;  or (c) to
terminate  performance  of the  affected  portions  of  this  Agreement  without
liability for damages.

16.   User Protection and Product Information:

The receiving  party  warrants that it will use its own  independent
skill and  expertise in  connection  with the selection and use of the supplying
party's  Product and that it possesses the skill and expertise to safely handle,
store,  transport,  use, and dispose of the Product.  In  connection  therewith,
receiving party agrees to:

16.1 Familiarize itself with available safety and health information
and precautions, including, but not limited to, those contained in any pertinent
material safety data sheet;

16.2 Adopt and follow safe handling, storage,  transportation,  use,
and disposal practices with respect to the Product,  including,  but not limited
to, those required by applicable law and regulation; and

16.3 Instruct its  employees,  independent  contractors,  agents and
customers in the warning and safe use practices  required in connection with the
unloading, handling, storage, transportation, use and disposal of the Product.

17. Labeling and Literature, Name on Product:

Each party hereto acknowledges that there may be risks and liability
resulting from the use of each party's Products.  Each party hereto acknowledges
that it has  received  and is  familiar  with the  supplying  party's  labeling,
literature  and any  pertinent  Material  Safety  Data  Sheets  ("MSDS"  sheets)
concerning such Products and their properties.  The receiving party will forward
such  information  to  receiving  party's  employees  and any others  (including
receiving party's customers),  who may handle, process or sell such Product from
supplying  party and advise such  parties to  familiarize  themselves  with such
information.

18.   Taxes, VAT, Import Duties

18.1 The receiving  party is  responsible  for payment of all taxes,
duties and VAT due and payable upon movement of Product under this Agreement.

18.2  Where VAT is payable  by one party to  another,  this shall be
charged  by means of a valid VAT  invoice  issued  pursuant  to the  legislation
extant in the country where the VAT charge is levied.

18.3 For any goods which have been supplied to the  receiving  party
VAT-free  on the basis that those  goods are to be  exported  from the  European
Union by the receiving  party, the receiving party is required to provide within
one month of the date of supply of product a certificate of shipment proving the
goods were removed from the European Union. If such  certificate is not provided
within that time period,  then the  supplying  party shall charge and  receiving
party shall pay VAT and  associated  penalties,  if any. Such VAT and associated
penalties shall be invoiced by the supplying  party and paid,  within 15 days of
receipt of the invoice, by the receiving party.

19.   Confidential Information:

19.1 For purposes of this Clause:

19.1.1  "Confidential  Information" means all information  received by the
receiving party from the disclosing party relating to the disclosing  party, its
Affiliates  and  the  businesses  conducted  by the  disclosing  party  (whether
pursuant to this Agreement or otherwise)  including not only written information
but information transferred orally,  visually,  electronically,  or by any other
means. For the avoidance of doubt, the term  Confidential  Information shall not
include:

(i)   information that is in the public domain at the date of
this Agreement;

(ii)  information  that  subsequently  comes into the public domain,
otherwise than as a result of a breach of this Agreement,  but
only after it has come into the public domain;

(iii) information  which the receiving party or its  Representatives
obtain  from a  third  party  not  under  any  confidentiality
obligation   to   the   disclosing   party   respecting   such
information;

(iv)  information  which the receiving party or its  Representatives
at the time of disclosure  already has in its  possession  and
which is not  subject  to any  obligation  of secrecy on their
part to the other party;

(v)   information  which is independently  developed by employees of
the receiving party or its  Representatives  who had no access
to the information disclosed by the disclosing party.

19.1.2 "Representatives" means Affiliates, directors, officers, employees,
agents  or  representatives  of  either  party  or  its  Affiliates,  and  their
respective solicitors, accountants, consultants and financial advisors.

19.2 Each party hereto  undertakes  to maintain  Confidential  Information
received  by it, its  Affiliates  or its  Representatives  relating to the other
party or the other  party's  Affiliates  in  confidence  and not  disclose  that
Confidential  Information  to any person other than its  Representatives  except
with the prior written approval of the other party.

19.3 Each  party  undertakes  only to  disclose  to  Representatives  such
Confidential  Information  relating  to the  other  party or the  other  party's
Affiliates  as is  reasonably  required  for  the  purposes  of  performing  the
obligations  under  this  Agreement  and  only  to  Representatives  whom it has
informed of the  confidential  nature of the  Confidential  Information  and who
undertake to keep it confidential.  Such  information  shall not be used for any
other purpose than the performance of the parties' obligations  hereunder.  Each
party shall be responsible for breach of such confidentiality  undertaking by it
or its Representatives.

19.4 In the event that, after receipt of Confidential Information,  either
party, or any person or Representative  to whom it has transmitted  Confidential
Information,  becomes  legally  required  (by oral  questions,  interrogatories,
requests for information or documents,  subpoena,  civil investigative demand or
similar  process or otherwise) to disclose any of the  Confidential  Information
received,  the legally compelled party shall provide the other party with prompt
written notice of that requirement so that the other party may seek a protective
order or other  appropriate  remedy but shall not be obliged to delay disclosure
if to do so would be in breach of any conditions for such disclosure  imposed by
the authority compelling  disclosure and in any event should the other party not
be  successful in seeking or obtaining a protective  order or other  appropriate
remedy,  the other party  shall waive  compliance  with the  provisions  of this
Agreement for such particular case to enable the legally  compelled party or its
Representative to comply with any such legal requirement.

19.5 Disclosure of Confidential Information to permitted assigns shall not
be a  violation  of this  Clause  19,  provided  that the  disclosing  party has
complied with the provisions of Clause 21.2.

20.   Dispute Resolution:

20.1 In the event of a dispute between supplying party and receiving
party arising in connection with this Agreement,  the parties will first attempt
to resolve the dispute informally.  If such informal efforts fail to resolve the
dispute to the  parties'  satisfaction,  senior  representatives  of each of the
parties  shall be  notified  and  shall,  within 10  Business  Days of a written
request from one party to the other, meet in a good faith effort to resolve such
dispute or difference without recourse to legal proceedings.

20.2 If the  dispute or  difference  is not  resolved as a result of
such  meeting,  supplying or  receiving  party may (at such meeting or within 10
Business  Days  from  its  conclusion)  propose  to the  other in  writing  that
structured  negotiations be entered into with the assistance of a mediator. Upon
receipt of such notice the parties to the dispute  shall each propose and select
a suitable mediator.

20.3 All negotiations  connected with the dispute shall be conducted
in strict  confidence and without  prejudice to the rights of the parties in any
future proceedings.

20.4  Within  seven  (7)  Business  Days of the  appointment  of the
mediator,  both  parties  shall meet with him/her in order to agree on a program
for the exchange of any relevant information and the structure to be adopted for
negotiations.

20.5  If  the   parties  to  the  dispute   accept  the   mediator's
recommendations  or otherwise  reach agreement on the resolution of the dispute,
such agreement  shall be reduced to writing and, once it is signed by their duly
authorized representatives,  shall be and remain binding upon the parties. If an
agreement  cannot be reached,  either of the parties may invite the  mediator to
provide a non-binding but informative opinion in writing,  provided however that
neither  party shall be entitled to rely on such  opinion or  introduce  it into
evidence in any legal  proceedings.  If agreement still cannot be reached,  then
any  dispute or  difference  between  the parties may be referred to the courts.
Unless a party is seeking injunctive relief, no dispute shall be referred to the
courts  until  30  Business   Days  after  the   mediator  has  issued   his/her
recommendation(s).

20.6 Each party shall bear its own costs of this Dispute  Resolution
process.

21.   Assignment:

21.1  Except as  provided  in  Subclause  21.2  below,  the  rights,
benefits  and  obligations  of the  parties  under this  Agreement  shall not be
assigned,  transferred or otherwise  disposed of in whole or in part without the
prior express written consent of the other party.

21.2 Consent to assignment of this  Agreement  shall not be required
(1) in  circumstances  where all the rights,  benefits and obligations of either
party hereto are proposed to be assigned or  transferred  to an Affiliate of the
transferring party; or (2) in the event that either party hereto or such party's
Affiliates  (if  applicable)  proposes  to assign all its rights,  benefits  and
obligations  to a third  party  purchaser  of the  transferring  party's  entire
interest in the manufacture of titanium dioxide;  provided  however,  (upon such
event) the transferring  party obtains the agreement of the proposed assignee or
transferee,  prior to the  transfer or  assignment,  to comply with the terms of
this agreement and except in the case of a sale pursuant to Subclause 21.2(2) to
obtain from the  assignee or  transferee a  re-assignment  in the event that the
assignee or transferee ceases to be an Affiliate.

22. No Agency and no Partnership:

22.1 Except as otherwise  expressly  provided for in this  Agreement
and/or the Schedules, or unless otherwise agreed between the parties in writing,
no party shall:

22.1.1      make purchases or sales or incur any
liabilities whatsoever on behalf of the other
party hereto;

22.1.2      pledge the credit of the other party; or

22.1.3      hold itself out as acting as agent for the
other party.

22.2 The parties hereto have not and expressly do not intend to form
a partnership by virtue of this Agreement and do not intend to be partners.

23. Entire Agreement/Amendments/Severability:

23.1 This Agreement contains the whole agreement between the parties
and their Affiliates relating to the transactions contemplated by this Agreement
and  supersedes  and replaces all  previous  agreements  between the parties and
their Affiliates relating to such transactions.

23.2 A provision  in another  agreement  between the parties to this
Agreement  or between the  respective  parent  undertakings  of the parties (and
whether  made before or after the date of this  Agreement)  which refers to this
Agreement and which extends or supplements  any provision of this Agreement will
be deemed for the purposes of Subclause 23.1 to form part of the whole agreement
between the parties as referred to in that Subclause.

23.3 Each of the parties to this agreement  acknowledges  on its own
behalf and on behalf of each of its Affiliates  that , in agreeing to enter into
this Agreement,  it has not relied on any representation,  warranty,  collateral
contract or other assurance  (except those set out in this Agreement) and waives
all rights and  remedies  which,  but for this  Subclause,  might  otherwise  be
available  to it in respect  of any such  representation,  warranty,  collateral
contract or other assurance, provided that nothing in this Clause shall limit or
exclude any liability for fraud.

23.4 Except as otherwise  specifically  stated,  no  modification or
amendment  hereto shall be of any force or effect  unless (1) reduced to writing
and signed by both  parties  hereto,  and (2)  expressly  referred to as being a
modification of this Agreement, including the attached Schedules.

23.5 If the  final  judgment  of a court of  competent  jurisdiction
declares   that  any  term  or  provision  of  this   Agreement  is  invalid  or
unenforceable  in whole or in part,  the parties agree that the court making the
determination of invalidity or  unenforceability  shall have the power to reduce
the list of customers in Schedule E, the scope, duration, or area of the term or
provision,  to delete  specific  words or phrases,  or to replace any invalid or
unenforceable  term or  provision  with a term or  provision  that is valid  and
enforceable  and that comes closest to expressing the intention of the pertinent
term or provision (or to approve such  reductions,  deletions or replacements as
agreed by the parties),  and this Agreement  shall be enforceable as so modified
after the expiration of the time within which the judgment may be appealed.

24.   Waiver:

24.1  The  failure  of  either  party to  insist  in any one or more
instances upon strict  performance of any of the provisions of this Agreement or
to take advantage of any of its rights shall not be construed as a waiver of any
such provision or the relinquishment of any such right.

24.2 The  provisions of the United  Nations  Convention on Contracts
for the International Sale of Goods 1980 shall not apply to this contract or any
transaction contemplated hereunder.

25.   Notices:

25.1 Any notice or other  document to be served under this Agreement
shall be in writing and may be  delivered  by hand or sent by post or  facsimile
process where the remote  facsimile  machine has an answer-back  facility to the
party  to be  served  at its  address  or  facsimile  number  appearing  in this
Agreement  and marked for the  attention of the person whose name is referred to
in Subclause 25.2 below. Any notice or other document sent by post shall be sent
by  registered   post  (if  both  posted  and  for  delivery   within  the  same
jurisdiction)  or by  registered  airmail  (if posted for  delivery  outside the
jurisdiction  in which it is  posted).  Any  notice  or other  document  sent by
facsimile  process shall also be sent to the other party by  registered  post or
registered airmail (as the case may be) in accordance with this Clause.

25.2 The person to whom notices or documents should be addressed for
the purposes of Subclause 25.1 is:

25.2.1 If to be served on TEL:
----------------------------
Name or Title, Business Unit

----------------------------
Address

25.2.2 If to be served on Newco:

----------------------------
Name or Title, Business Unit

----------------------------
Address

25.3 In  proving  service  of a  notice  or  document  it  shall  be
sufficient  to  prove  that  delivery  was  made by hand  or that  the  envelope
containing  the notice or document was properly  addressed and posted (either by
registered post or by registered airmail, as the case may be, in accordance with
the  requirements of this Clause 25) or that the facsimile  message was properly
addressed and dispatched as the case may be.

26.   Governing Law:

This Agreement is governed by and shall be construed in
accordance with Delaware (U.S.) law.

27.   Covenant Not to Compete

For a period of two and one-half years from and after the Completion
Date, none of TEL or its Affiliates will directly or indirectly market,  sell or
offer for sale in North America (a) to any of the customers listed in Schedule E
any product  (whether or not such  product is listed in  Schedules A, B, C or D)
that is  manufactured  by the sulfate  process,  and (b) to any of the customers
listed in  Schedule F any TC4  Product.  Schedule E shall  include  all  current
customers  and all former  customers  who have  purchased in North  America from
Tioxide  (or  its  Affiliates),  during  the  three-year  period  ending  on the
Completion Date, titanium dioxide manufactured by the sulfate process.  Schedule
F shall  include  all  current  customers  and all  former  customers  who  have
purchased  in  North  America  from  Tioxide  (or its  Affiliates),  during  the
three-year period ending on the Completion Date, TC4 Product.

28.   Assurances

The parties hereto  acknowledge  that due to inadequate  information
available to them on the Completion Date, there may be other Products (or in the
case of Schedules E and F, other customers)  which,  according to the provisions
of this Agreement,  should have been included on the Schedules A, B, C, D, E and
F. To the extent that the parties  hereto obtain  additional  information  which
indicates  that a Product or customer  should have been included in the relevant
Schedule,  the parties shall consult with a view to agreeing whether the Product
or customer should be included,  such agreement not to be unreasonably withheld.
From and after the parties'  agreement  pursuant to this Clause 28, such Product
or customer  shall be deemed to be a part of the relevant  Schedule as if it had
been included as on the Completion Date.

IN WITNESS  WHEREOF,  the parties hereto have caused this Product Exchange
Agreement to be executed by their duly authorized representatives.

TIOXIDE EUROPE, LTD.                      NEWCO, Ltd.

By:_________________________________      By:___________________________

Title:_______________________________     Title:_________________________

Date:_______________                      Date:_____________

EXHIBIT 10.6

DATED                           1998

ICI AMERICAN HOLDINGS INC.

and

NL INDUSTRIES, INC.

SHARE SALE AND PURCHASE AGREEMENT

OF

TIOXIDE AMERICAS INC.

LINKLATERS & PAINES
One Silk Street
London EC2Y 8HQ

TEL: (+44) 171 456 2000

Ref: AXT

THIS AGREEMENT (this "AGREEMENT") is made on              1998  BETWEEN:

(1) ICI AMERICAN  HOLDINGS INC. a Delaware  Corporation  with  principal
place of business at 3411  Silverside  Road,  Wilmington,  DE 19850,
USA (the "SELLER"); and

(2) N L INDUSTRIES,  INC., a corporation  incorporated under the laws of
New Jersey, whose principal place of business is at 16825 Northchase
Drive, Suite 1200, Houston, Texas 77060, USA (the "PURCHASER").

WHEREAS:

(A) Tioxide  Americas  Inc. is a corporation  incorporated  in Delaware,
USA,  short  particulars  of which  are set out in  Schedule  1 (the
"COMPANY").

(B) The  Seller  holds all of the  issued  shares in the  capital of the
Company (the "SALE  SHARES")  particulars  of which are contained in
Schedule 1.

(C) The  Seller  has  agreed  to sell and the  Purchaser  has  agreed to
purchase the Sale Shares on the terms and subject to the  conditions
set out in this agreement and the Framework Agreement.

IT IS AGREED as follows:

1 INTERPRETATION

1.1 In this agreement:

"ACCOUNTS"  means  the  audited  accounts  of the  Company  for the year
ended 31 December 1997;

"ADVERSE CONSEQUENCES" means all actions, suits, proceedings,  hearings,
investigations,   charges,  claims,  demands,  injunctions,   judgments,
orders,  decrees,  rulings,  damages,  dues,  penalties,  fines,  costs,
amounts paid in settlement, liabilities,  obligations, liens (other than
those  arising by operation of law or by statute)  losses,  expenses and
fees, including court costs and reasonable attorneys' fees and expenses;

"AFFILIATES"  means with respect to a specified  entity,  an entity that
directly or indirectly through one or more intermediaries,  Controls, or
is Controlled by, or is under common Control with, the entity specified,
provided,  that,  without  limiting the generality of the foregoing,  in
relation  to ICI and its  subsidiary  companies,  the term  "AFFILIATES"
shall not  include any entity in which a party has a 50 per cent or less
ownership interest. For the purposes hereof, "CONTROL" means possession,
directly or indirectly, of the power to direct or cause the direction of
the management and operating  policies of the entity in respect of which
the  determination  is being  made,  through  the  ownership  of  voting
securities,  contract,  voting trust or otherwise  but any  reference in
this  agreement  to an Affiliate  of the Seller or the  Purchaser  shall
exclude  the  Company,  and  references  to the  Seller's  Group  or the
Purchaser's Group shall be construed accordingly;

"AGREED  FORM"  means,  in  relation to any  document,  the form of that
document which has been initialled for the purpose of  identification by
or on behalf of the parties to this agreement;

"AMERICAS  LIABILITY  AGREEMENT" means the liability  agreement  between
ICI and the Purchaser dated [                 ];

"ASSETS"  means all of the assets and rights of the Company  relating to
the Business but excluding the LPC Interests;

"BUSINESS" means the manufacture,  import, export, sale and distribution
of titanium dioxide  pigments and co-products,  and related products and
all other business and operations as carried on by the Company as at the
date hereof but shall not include:

(i) the  manufacture,  sale or  disposal  by way of  trade of any
organometallic  compounds  save  the  manufacture,   sale  or
disposal  of a pigment  which  incorporates  as an  essential
feature of its composition an  organometallic  compound shall
not be considered to be the manufacture,  sale or disposal of
an organometallic compound as such;

(ii)the manufacture, sale or disposal by way of trade of any form
of titanium dioxide of ultraviolet-attenuating grade having a
ratio of  absorbance  response at 308 nm (A308) to absorbance
response at 524 nm (A524) of not less than 5 as defined in US
Pharmacopeia,  amendment  published  in  Pharmacopeia  Forum,
Volume 22,  Number 4, Page 2636 and attached  hereto as Annex
2; and

(iii) any matter relating to the LPC Interests or LPC;

"BUSINESS  DATA" means the Company's  historical  and current  documents
relating to the Business, including customer lists, product, distributor
and supplier lists, catalogues,  literature, employee records, documents
of title to the Assets (but excluding those relating to the Properties),
sales targets,  sales  statistics,  market share  statistics,  marketing
surveys and reports,  marketing  research and any  advertising  or other
promotional  materials,  production  data,  safety  data and  accounting
(including  management  account records) and other financial data (other
than the US Financial Information),  whether in hard copy or in computer
held form  (including for the avoidance of doubt such media as microfilm
and microfiche);

"BUSINESS  DAY" means a day (other  than a Saturday  or Sunday) on which
banks are generally open for normal business in both London and New York
and  (when any  action  is  required  by this  agreement  to be taken in
Canada) Montreal;

"CODE"  means  the  United  States  Internal  Revenue  Code of 1986,  as
amended;

"COMPLETION"  means  completion  of the  sale and  purchase  of the Sale
Shares  in  accordance  with  Clause  7 which  shall  occur  immediately
following signature and exchange of this agreement;

"COMPLETION DATE" means  [                        ]  on the date of this
agreement;

"COMPUTER    SYSTEMS"   means   all   computer    hardware,    software,
microprocessors  and  firmware  which  in  each  case  are  used  in the
Business;

"CONTRACTS"  means  all  contracts  and  arrangements  relating  to  the
Business  entered into before  Completion by or on behalf of the Company
in connection with the Business which remain (in whole or in part) to be
performed  at  Completion  and,  in  addition,  means any  contracts  or
arrangements  between  the  Company  and  the  Seller  (or  any  of  its
Affiliates) but shall not include any contracts or arrangements relating
to the LPC Interests or LPC;

"DEFAULT   INTEREST"  means  LIBOR  plus  200  basis  points  compounded
monthly;

"DISCLOSURE   LETTER"  means  the  letter  of  the  same  date  as  this
agreement from the Seller to the Purchaser;

"DUPONT" means E.I. du Pont de Nemours and Company;

"EMPLOYEES"  means all those  individuals  employed  by the  Company  at
Completion;

"ENVIRONMENT" has the meaning in Schedule 5;

"ENVIRONMENTAL  AUTHORISATIONS" means all or any permits,  certificates,
consents,  licences,  approvals,  registrations and other authorisations
required under  Environmental  Laws and all terms and conditions thereof
required under any Environmental Law for the operation of the Business;

"ENVIRONMENTAL LAWS" has the meaning given in Schedule 5;

"ESTIMATED CONSIDERATION" has the meaning given in Clause 3;

"FIELD OF ACTIVITY"  means the  manufacture,  import,  export,  sale and
distribution of titanium dioxide  pigments and co-products,  and related
products as carried on by the Company, but shall not include:

(i) the  manufacture,  sale or  disposal  by way of  trade of any
organometallic  compounds  save  the  manufacture,   sale  or
disposal  of a pigment  which  incorporates  as an  essential
feature of its composition an  organometallic  compound shall
not be considered to be the manufacture,  sale or disposal of
an organometallic compound as such; and

(ii)the manufacture, sale or disposal by way of trade of any form
of titanium dioxide of ultraviolet-attenuating grade having a
ratio of  absorbance  response at 308 nm (A308) to absorbance
response at 524 nm (A524) of not less than 5 as defined in US
Pharmacopeia,  amendment  published  in  Pharmacopeia  Forum,
Volume 22,  Number 4, Page 2636 and attached  hereto as Annex
2;

"FINAL CONSIDERATION" has the meaning given in Schedule 6;

"FRAMEWORK  AGREEMENT"  means the agreement  dated o between ICI, DuPont
and the Purchaser;

"GUARANTEES" means all guarantees and indemnities given by the Seller or
Affiliates  of the Seller in respect of  obligations  of the  Company in
relation to the Business,  short  particulars  of which are contained in
the Disclosure Letter;

"HAZARDOUS MATERIAL" has the meaning given in Schedule 5;

"ICI" means Imperial Chemical Industries PLC;

"ICI GROUP" means ICI and its Affiliates as at the Completion Date;

"IMPLEMENTATION AGREEMENTS" means the documents in Schedule 4;

"INDEPENDENT ACCOUNTANT" has the meaning given in Clause 11;

"INTELLECTUAL  PROPERTY"  shall mean all  patents,  trademarks,  service
marks,  trade  names and all  goodwill  associated  with the  foregoing,
registered designs, copyrights,  copyrightable works (including, without
limitation,  data,  documentation  and  databases)  registered  internet
domain names,  and rights to inventions and  applications for and rights
to apply for protection or registrations  of any of the same;  including
any continuation, continuation-in-part, provisional, reissue, divisional
and  re-examination  patent  applications  and all  rights in  Technical
Information;

"INTRA-GROUP  LOANS"  means  all Net Debt due  from the  Company  to the
Seller or any  Affiliate  of the Seller or due to the  Company  from the
Seller or any Affiliate of the Seller as  determined in accordance  with
Schedule 6, and in both circumstances  relating only to those Affiliates
of the Seller following Completion;

"LIBOR"  means the rate for  deposits  in US Dollars for a period of one
month which appears on the Reuters  Screen ISDA Page (or such other page
as the parties may agree) at approximately

11.00  a.m.,  London  time,  on the first day of the period to which any
interest  period  relates (the "RELEVANT  DATE").  If such rate does not
appear on the Reuters  Screen ISDA Page on the Relevant  Date,  the rate
for  that  Relevant  Date  will  be  determined  as if the  parties  had
specified  that the rate for the Relevant Date will be determined on the
basis of the  rates at which  deposits  in US  Dollars  are  offered  by
Midland  Bank plc at  approximately  11.00  a.m.,  London  time,  on the
Relevant Date to prime banks in the London interbank market for a period
of  one  month   commencing   on  that  Relevant  Date  for  amounts  of
US$10,000,000;

"LPC" means the Louisiana Pigment Company Limited Partnership;

"LPC INTERESTS"  means all  partnership  interests held by the Seller or
its Affiliates in LPC pursuant to the Joint Venture  Agreement  dated as
of  18  October  1993,  as  amended,  between  the  Company  and  Kronos
Louisiana, Inc.;

"LPC BUSINESS"  means the LPC Interests,  sales sourced from LPC and any
Stocks,  Operating  Debtors,  Operating  Creditors less than 1 year (the
definitions  of such terms in Schedule 6 being applied to LPC) and other
assets or liabilities  relating to LPC as determined  and  distinguished
from the Business in accordance with Schedule 7;

"LPC WARRANTIES" has the meaning given in sub-Clause 5.1(b);

"MATERIAL CONTRACTS" means all Contracts (i) which at Completion have in
excess of 12 months  to run and  which in that time can  reasonably  be,
expected to involve  income or expenditure in respect of the Business in
excess of US$200,000  per annum;  or (ii) which at Completion  have less
than 12 months to run and which in that time can  reasonably be expected
to involve income or expenditure in respect of the Business in excess of
US$500,000;  or (iii) which relate to the treatment  and/or  disposal of
waste; or (iv) which relate to contract  manufacturing  or processing of
products  by  third  parties;   or  (v)  which  relate  to  third  party
distribution  or agency in respect of  products;  or (vi) the absence of
which  would  have a  material  negative  impact on the  conduct  of the
Business;

"NET DEBT" has the meaning given in Schedule 6;

"NON-LPC WARRANTIES" has the meaning given in sub-Clause 5.1(a);

"ORDINARY  COURSE OF  BUSINESS"  means the  ordinary  course of business
consistent with past custom and practice  including,  without limitation
quantity  and   frequency,   taking  into  account  the   relevance  and
reasonableness  of the same and with  allowance  made for the inherently
cyclical nature of the titanium dioxide industry;

"PARENT  UNDERTAKING"  shall have the meaning  given in  section 258  of
the United Kingdom Companies Act 1985;

"PERMITS" means all licences, permits, authorisations, registrations and
approvals  required  by  law or  regulation  or  issued  or  granted  by
statutory or other  authorities  to the Company for the operation of the
Business  (but   excluding,   for  the  avoidance  of  doubt,   planning
permissions   issued  by  relevant   planning   authorities   (save  for
Environmental  Authorisations) and any licence, permit, authorisation or
approval which falls within the definition of Regulatory Conditions);

"PLANT AND EQUIPMENT" means the plant,  machinery,  spare parts,  tools,
equipment,  chattels, motor vehicles,  furniture,  fixtures and fittings
(to the extent they are not  included in the  Properties)  and all other
tangible  personal property located at the Property  (including  without
limitation  office equipment) which in each case is owned and/or used by
the Company in relation to the Business as at Completion;

"PROPERTY" means the property shown in Schedule 2 Part I;

"PURCHASER'S AUDITORS" means PricewaterhouseCoopers;

"PURCHASER'S  GROUP" means the Purchaser's  ultimate parent  undertaking
and that parent undertaking's Affiliates;

"REGULATORY  CONDITIONS"  means the  anti-trust or regulatory  approvals
(other than Environmental Authorisations) necessary to complete the sale
of the Company on the terms set out in this agreement;

"SCHEME" means the Company's  pension plans  described in the Disclosure
Letter;

"SELLER'S AUDITORS" means KPMG;

"SELLER'S  GROUP" means the Seller's  ultimate  parent  undertaking  and
that parent undertaking's Affiliates as at the Completion Date;

"STOCK"  means  the  stocks  of  fuels,   raw  materials,   ingredients,
packaging,   office  and  laboratory   supplies,   engineering   spares,
consumable  stores,  work-in-progress  and finished  goods at Completion
held by the Company for the purposes of the Business;

"TAX" has the meaning given in the Tax Deed of Covenant;

"TAXATION" has the meaning given in the Tax Deed of Covenant;

"TAX AUTHORITY" has the meaning given in the Tax Deed of Covenant;

"TAX DEED OF  COVENANT"  means the tax deed of  covenant  in the  Agreed
Form;

"TAX LIABILITY" has the meaning given in the Tax Deed of Covenant;

"TECHNICAL  INFORMATION"  shall mean all  technical  data and  know-how,
industrial  and  technical  information,   trade  secrets,  confidential
information,  drawings,  formulations,  technical reports, operating and
testing  procedures,  instruction  manuals,  raw material or  production
specifications, the results of research and development work, whether in
hard copy or in computer held form (including for the avoidance of doubt
in such media as microfilm and microfiche or otherwise);

"TERRITORIES"  means the  United  States  of  America,  Canada,  Mexico,
Central and South America;

"UK GAAP" means generally accepted  accounting  principles in the United
Kingdom;

"US  DOLLARS",  "US$" or "$" means the  lawful  currency  of the  United
States of America;

"US FINANCIAL  INFORMATION" means the financial  information attached as
Schedule 8;

"US NAME AGREEMENT" means the agreement in the Agreed Form;

"WARRANTIES" means the LPC Warranties and the Non-LPC Warranties; and

"WARRANTY CLAIM" has the meaning given in sub-Clause 5.4.

1.2 Unless otherwise stated,  any express reference to an enactment includes
references to:

(a)    that  enactment  as amended,  extended or applied by or under any
other enactment before or after this agreement;

(b)    any enactment  which that  enactment  re-enacts  (with or without
modification); and

(c)    any subordinate legislation made (before or after this agreement)
under any enactment, including one within (a) or (b) above,

except to the extent that any of the  matters  referred to in (a) to (c)
occurring  after the date of this agreement  would increase or alter the
liability of any party under this agreement.

1.3 The singular  shall include the plural and vice versa and words denoting
persons shall include bodies corporate and  unincorporated  associations
of  persons  and,  unless  otherwise  stated,  shall  include  permitted
successors or assigns of such persons.

1.4 Sub-Clauses 1.1 to 1.3 apply unless the contrary intention appears.

1.5 The headings in this agreement do not affect its interpretation.

1.6 Any Schedule or Annex to this agreement  shall take effect as if set out
in this  agreement and  references to this  agreement  shall include its
Schedules and Annexes.

1.7 Where any statement in this  agreement (or in the attached  Schedules or
Annexes) (other than in Schedule 3 paragraphs H(2) and H(4) is qualified
by the  expression  "SO FAR AS THE  SELLER IS AWARE,"  "TO THE  SELLER'S
KNOWLEDGE, INFORMATION AND BELIEF," "KNOWN TO THE SELLER" or any similar
statement,  that statement shall be deemed to mean the knowledge,  after
reasonable investigation, of the officers and operational and functional
managers of ICI and its  Affiliates who have direct  responsibility  for
the subject matter concerned, being those listed in Schedule 9.

2 SALE AND PURCHASE OF THE SALE SHARES

2.1 The Seller shall with full title  guarantee sell and the Purchaser shall
purchase the Sale Shares together with all rights attaching to them.

2.2 The Sale Shares shall be sold free from all liens, charges, equities and
encumbrances and other rights exercisable by third parties or Affiliates
of the Seller.

3 CONSIDERATION AND ADJUSTMENTS

3.1 Subject to sub-Clause 3.4 below, the  consideration  for the sale of the
Sale  Shares  shall  be  US$[o]  payable  in  cash by the  Purchaser  on
Completion (the "ESTIMATED CONSIDERATION").

3.2 The payment under sub-Clause 3.1 shall be paid to the correspondent bank
named below for credit to the US Dollar account of o (the "ICI ACCOUNT")
referred to below:

Correspondent bank:
Bank account:
Account name:
Account no:
Sort code:

3.3 Any payments to the Purchaser  under this agreement shall be paid to the
correspondent  bank named below for credit to the US Dollar account of o
(the "PURCHASER ACCOUNT") referred to below:

3.4

Correspondent bank:
Bank account:
Account name:
Account no:
Sort code:

3.5 The Final  Consideration  shall be determined and any difference between
the Estimated Consideration and the Final Consideration shall be paid in
accordance with the provisions of Schedule 6.

4 PURCHASER'S WARRANTIES

The Purchaser represents and warrants to the Seller that:

(a)    it (and each of its Affiliates,  in respect of the Implementation
Agreements to which such  Affiliate is a party) has the requisite
power and  authority to enter into and to perform this  agreement
and such Implementation Agreements;

(b)    it (and each of its Affiliates,  in respect of the Implementation
Agreements  to which such  Affiliate  is a party) has obtained or
satisfied all corporate,  regulatory and other approvals,  or any
other  significant  conditions,  necessary to execute and perform
this agreement and such Implementation Agreements;

(c)    this agreement and the Implementation Agreements constitute valid
and  binding  obligations  of  the  Purchaser  (and  each  of its
Affiliates,  in respect of the Implementation Agreements to which
such Affiliate is a party)  enforceable in accordance  with their
respective terms; and

(d)    compliance  with the terms of this agreement by the Purchaser and
the Implementation  Agreements by the Purchaser or its Affiliates
(as appropriate) will:

(i) not constitute a breach of any agreement or contract to which
the  Purchaser or such  Affiliate of the Purchaser is a party
or by which it is bound; and

(ii)be in compliance  with the  Purchaser's  or such Affiliate of
the  Purchaser's  memorandum  and articles of  association or
other constitutional documents; and

(iii) not contravene:

(a)any order, judgment or decree; or

(b)any statute, rule or regulation or;

(c)any other restriction of any kind by which the Purchaser
or such Affiliate of the Purchaser is bound.

5 SELLER'S WARRANTIES

5.1 The Seller represents and warrants to the Purchaser in the terms set out
in Part A.1 of Schedule 3.1 and that:

(a)    with  respect to the  Business and to the sale of the Sale Shares
and not with  respect  to the LPC  Interests,  save as  otherwise
stated  in  this   agreement  and  subject  to  all  matters  and
circumstances  fairly  disclosed in the Disclosure  Letter,  each
of  the  statements  set  out  in  Schedule  3.1  Part  A.2  to N
(inclusive)  (the "NON-LPC  WARRANTIES")  is true and accurate as
at the date of this  agreement and the Seller  acknowledges  that
the  Purchaser  has entered into this  agreement in reliance upon
the Non-LPC Warranties; and

(b)    with respect to the LPC Interests only, save as otherwise  stated
in this  agreement  and subject to all matters and  circumstances
fairly disclosed in the Disclosure Letter, each of the statements
set out in  Schedule  3.2  (the  "LPC  Warranties")  is true  and
accurate  as at  the  date  of  this  agreement  and  the  Seller
acknowledges  that the Purchaser has entered into this  Agreement
in reliance upon the LPC Warranties.

The Purchaser  agrees that save as set out in Schedule 3.2, no warranty,
representation,  undertaking  or  indemnity  or  any  other  contractual
obligation  or  otherwise  is made or given by the  Seller to either the
Purchaser or its Affiliates in relation to LPC or the LPC Interests.

5.2 Each of the Warranties shall be separate and independent and no Warranty
shall limit the scope or construction of any other Warranty or any other
provision of this agreement.

5.3 The Purchaser acknowledges and agrees that:

(i) save  as  may  be  set  out  in  this  agreement  or  in  the
Implementation  Agreements,  except for the Warranties and in
relation to an allegation of fraud, no statement,  promise or
forecast  made by or on behalf of the Seller or any member of
the  Seller's  Group may form the basis of, or be  pleaded in
connection  with,  any  claim  by the  Purchaser  under or in
connection   with  this   agreement  or  the   Implementation
Agreements; and

(ii)any claim by the Purchaser or any person  deriving title from
it in connection with the Warranties  shall be subject to the
following provisions of this clause.

5.4 The  liability of the Seller in respect of any breach of the  Warranties
(a "WARRANTY  CLAIM") or the  indemnities  contained  in this  agreement
shall be  governed  by the  terms of the  Americas  Liability  Agreement
except as expressly provided therein.

5.5 The  liability  of the Seller  under or in  respect of a Warranty  Claim
shall also be limited in respect of any liability  which is  contingent,
unless and until such liability  becomes an actual  liability and is due
and payable  provided  that the Purchaser  shall not be prohibited  from
bringing  a Warranty  Claim  pending  such  liability  becoming  due and
payable.

5.6 The Purchaser acknowledges and agrees that:

(i) no  liability  shall  attach  to the  Seller by reason of any
breach of any of the Warranties or any indemnities  contained
in this  agreement to the extent that the loss  including all
relevant  costs  and  expenses  has  been  recovered  by  the
Purchaser  under  Schedule  5  or  any  other  term  of  this
agreement  or any  other  document  referred  to  herein  and
accordingly the Purchaser may only recover once in respect of
the same loss; and

(ii)in calculating  the liability of the Seller for any breach of
the  Warranties  there shall be taken into account the amount
by which any  Taxation  for which the  Purchaser is now or in
the future accountable or liable to be assessed is reduced or
extinguished  as a result of the matter  giving  rise to such
liability.

5.7 The Purchaser shall not be entitled to make any Warranty Claim:

(i) to the extent  that the claim  arises as a result only of any
change after  Completion in the  accounting  bases upon which
the  Company  values its assets or  computes  its  profits or
arises as a result of the  taxation or  accounting  policies,
bases or practices of the Purchaser  being different to those
adopted or used in preparing the Accounts; or

(ii)to the extent that the matter which constitutes the claim was
specifically  consented to in writing by the Purchaser in the
knowledge  that such matter would give rise to such  Warranty
Claim.

5.8 The  Purchaser  shall not be  entitled  to  rescind  or  terminate  this
agreement after Completion in any circumstances provided that nothing in
this sub-Clause shall exclude or limit any right to rescind or terminate
for fraud.

5.9 Save as otherwise  provided in this  agreement,  the Seller shall not be
liable in respect of any Warranty Claim to the extent that the liability
of the Seller in respect thereof is incurred or increased as a result of
any  legislation not brought into force at the date of this agreement or
as a result of any change in or repeal of legislation  hereafter or as a
result of the  introduction  or cessation of or change in the  published
practice of any taxation authority after the date of this agreement.

5.10 The Purchaser  shall not be entitled to make any claim in respect of any
breach or alleged breach of the Warranties to the extent that:

(i) the facts,  matters or circumstances  giving rise thereto (in
respect of which any such claim or alleged claim arises) have
been fairly disclosed in the Disclosure Letter; or

(ii)such claim arises or is incurred as a result of any voluntary
act or  omission of the  Purchaser  or any  Affiliate  of the
Purchaser  after the date of this  agreement,  other than any
such act or  omission  which  is in the  Ordinary  Course  of
Business  or is  required  by law or is pursuant to a legally
binding  commitment  of  the  Company  or any  member  of the
Seller's Group created or entered into before Completion.

5.11 The  provisions of this Clause 5 shall have effect  notwithstanding  any
other provisions of this agreement.

6 SELLER'S INDEMNITY

6.1 The Seller  undertakes to indemnify and keep  indemnified the Purchaser,
its Affiliates and the Company (the  "INDEMNIFIED  PARTIES") against all
claims  by  third  parties  (other  than  any  subsequent  purchaser  or
purchasers  of either the Sale  Shares or the  business or assets of the
Company and their successors in title or assigns) giving rise to Adverse
Consequences  which  may be paid,  suffered  or  incurred  by any of the
Indemnified  Parties  or to which  any of the  Indemnified  Parties  may
become  subject  and  which  arise as a result of the  operation  of the
Business by the Company  prior to  Completion  (unless and to the extent
that the  circumstances  giving  rise to the Adverse  Consequences  were
fairly  disclosed  in  the  Disclosure  Letter)  and  including  without
limitation those Adverse Consequences arising:

(a)    as a result of the failure by the Company to comply with relevant
and  legally   enforceable   corporate  or  other  laws,   rules,
ordinances or  regulations  with respect to the operations of the
Business prior to Completion;

(b)    as a result of the  failure  by the  Company  to obtain  required
relevant  governmental  permits,  licences,   consents  or  other
authorisations  with  respect to the  operation  of the  Business
prior to Completion;

(c)    from or with respect to any breach of  contract,  tort or product
liability  or  otherwise  arising  from,  or with respect to, the
operation of the Business prior to Completion and asserted by any
third party; and

(d)    from or with respect to any suit,  action,  arbitration,  charge,
governmental  investigation,  claim,  litigation  or  proceedings
affecting the Business or the Company.

Provided that the  indemnity  contained in this Clause 6 shall not apply
to:

(i) liabilities  expressly  assumed by the Purchaser  pursuant to
this agreement or the Implementation Agreements; or

(ii)to the  extent  that such  liabilities  have been  taken into
account in establishing the Final Consideration; or

(iii) any Environmental  Liabilities,  any failure or omission to
obtain  or  comply  with  Environmental  Authorisations,  any
failure or omission to comply with any Environmental  Laws or
any claim by any person in  respect of any matter  concerning
the   Environment   (indemnity   for  which  is  provided  in
sub-Clause 9.2 and Schedule 5); or

(iv)Taxation  (indemnity  for which is  provided  in the Tax Deed
of Covenant); or

(v) the LPC Interests or LPC.

6.2 The  Purchaser  agrees to give the  Seller  notice of any and all claims
asserted  against the  Purchaser  for which  indemnification  under this
Clause  6 is or may be  sought.  Such  notice  shall be given as soon as
reasonably  practicable after the Purchaser becomes aware that it has or
may have a claim  against  the Seller.  Under this Clause 6,  failure to
give such notice shall not abrogate or diminish the Seller's  obligation
under  this  Clause  if the  Seller  has or  receives  knowledge  of the
existence  of any such claim by any other means or if such  failure does
not prejudice the Seller's ability to defend such a claim.

7 COMPLETION

7.1 Completion shall take place at the offices of the [        ] immediately
after the signature of this agreement when:

(a)    each  party  shall  provide  to  the  other  evidence  in a  form
reasonably  satisfactory  to the  other  that it (and each of its
relevant  Affiliates  entering into an Implementation  Agreement)
has  all  necessary  corporate  approvals  and  consents  and its
signatories have necessary authority to enter into this agreement
and the other agreements referred to herein;

(b)    each party shall (or shall  procure that its relevant  Affiliates
will) duly  execute and, to the extent  applicable,  complete the
Implementation Agreements and the Tax Deed of Covenant;

(c)    the Seller shall deliver to or into the possession and control of
the Purchaser:

(i) a duly  executed  transfer  or  transfers  in  favour  of the
Purchaser  (or  such   Affiliate  of  the  Purchaser  as  the
Purchaser may nominate) of all the Sale Shares;

(ii)share  certificate(s) or other documents of title relating to
the Sale Shares (or an express indemnity in a form reasonably
satisfactory  to the  Purchaser  in the  case of any  missing
certificates or documents of title);

(iii) the  company  books  relating  to  the  Company,  including
certificates of  incorporation,  common seals,  minute books,
statutory  registers,   shareholders'  agreements  and  share
certificate books (duly written up to date);

(iv)resignations  of  all  the  directors  and  secretary  of the
Company;

(v) the  written  resignation  of the  auditors of the Company to
take effect on  Completion,  with  acknowledgments  signed by
them to the  effect  that  they  have no  claim  against  the
Company  and to the effect  that  there are no  circumstances
connected with their  resignation  which they consider should
be brought to the notice of the  shareholders or creditors of
the Company;

(vi)bank statements in respect of every account which the Company
has,  dated  two days  prior to the  Completion  Date and the
relevant  reconciliation  statements prepared on the previous
Business Day;

(vii) the Business Data;

(viii) the  documentation  and  title  deeds to the  Property  in
accordance with the provisions of Part II of Schedule 2;

(ix)the  Implementation  Agreements  duly  executed by the Seller
and/or Affiliates of the Seller as applicable; and

(x) the Disclosure Letter;

(d)    the   Purchaser   shall   pay  to  the   Seller   the   Estimated
Consideration;

(e)    the Purchaser or another  member of the  Purchaser's  Group shall
procure  that all  Intra-group  Loans due from the Company to the
Seller or any  Affiliate  of the Seller are repaid by the Company
and the  Seller or another  member of the  Seller's  Group  shall
procure  that all  Intra-group  Loans due to the Company from the
Seller or any Affiliate of the Seller are repaid by the Seller or
its relevant Affiliates;

(f)    the Seller shall take, or shall procure the taking of, such steps
as may be necessary to:

(i) approve  the  transfers  referred  to in  Clause  7.1(c)  (i)
(subject only to the Purchaser arranging and paying any taxes
or duties arising in relation to the transfer); and

(ii)appoint such  directors  and  secretary as the  Purchaser may
specify as directors and the secretary of the Company; and

(iii) release the securities,  guarantees, claims and indemnities
existing  immediately  prior to  Completion  other than those
arising in the Ordinary Course of Business, owed or due to or
claimed by the Seller or any  Affiliate  (being an  Affiliate
after  Completion)  from  the  Company,   true  and  complete
particulars of which are set out in Schedule 10;

(g)    each party shall  deliver a copy of the Tax Deed of Covenant duly
executed to the other party.

8 EMPLOYEES

8.1 The  Purchaser  agrees to procure  that the Company for a period of four
years from the Completion Date, will procure that:

(a)    the Employees will receive and enjoy contractual remuneration and
benefits  (including  separation and other benefits  described in
the Disclosure  Letter) which,  judged  objectively,  are no less
favourable  overall  than  their  contractual   remuneration  and
benefits at the Completion Date; and

(b)    it  will  not  make  any  unilateral   material   change  to  the
contractual terms and conditions of employment with the Employees
without prior  consultation  where  required by any local laws or
agreements,  with recognised trade unions,  appropriate  employee
representatives, or the Employees.

8.2 The Seller will procure that, on or before Completion,  the Company will
discharge its  liability to Mr Rene Lachance in respect of  Supplemental
Employment Terms.

8.3 For the purposes of this clause,  "SUPPLEMENTAL  EMPLOYMENT TERMS" shall
mean:

8.3.1  the period of additional  notice (if any) due from the Company at
the date such  liability  crystallises  under the  arrangement in
force as at Completion  which is in excess of that which he would
have received under the terms of his service  agreement  dated 25
October 1990;

8.3.2  the  additional   life   assurance   cover  (if  any)  under  the
arrangement  in force as at Completion  which is in excess of the
cover provided under the terms of his service  agreement dated 25
October 1990;

8.3.3  the supplemental  retirement benefits that are in addition to the
benefits  to  which  Mr.  Lachance  is  entitled  under  the  TAI
Retirement Plan and the TCI Staff Employees' Pension Plan; and

8.3.4  any other  enhancements to his terms and conditions of employment
granted  between 25 October 1990 and  Completion and which are in
force as at  Completion  other than those granted in the Ordinary
Course of Business.

8.4 The Seller will  indemnify  the  Purchaser  (for itself and as agent and
trustee  for the  Company)  on a  continuing  basis  against any and all
losses or liabilities, costs (including without limitation legal costs),
charges, expenses,  actions,  proceedings,  claims and demands which the
Purchaser  or the Company may incur and which  relate to or arise out of
the continuation after Completion of the Supplemental Employment Terms.

8.5 The Purchaser acknowledges and agrees that all of the funds set aside or
due at  Completion  to be set  aside by the  Company  in  trust  for the
purpose  of meeting  the  liability  of the  Seller  and the  Company to
provide  supplemental  retirement  benefits for Mr Lachance will be used
for this  purpose.  The funds  held in trust are held at  Merrill  Lynch
Trust  Company of America  Chicago in account no.  637-95-521.  If these
funds  have  not  been  used for this  purpose  before  Completion,  the
Purchaser  will procure that the Company  complies  with any  directions
given by the Seller as to the use of these  funds after  Completion  for
the purpose of providing such benefits for Mr Lachance.

8.6 The Seller will  indemnify  the  Purchaser  (for itself and as agent and
trustee  for the  Company)  on a  continuing  basis  against any and all
losses or liabilities,  costs (including without limitation legal costs)
charges, expenses,  actions,  proceedings,  claims and demands which the
Purchaser  or the  Company  may  incur  as a  result  of  the  severance
payments, pension entitlements, accelerated pension entitlements and any
other  benefits  actually  paid  to any  employee  whose  employment  is
terminated  after  Completion  if  and  to  the  extent  such  payments,
entitlements  and/or  benefits  are in excess of those  which would have
applied at any time in the period  prior to 10 September  1997  Provided
always  that the  dismissal  which  results  in the excess  costs  being
incurred  takes effect within four years of  Completion  and the regular
salary figure used in the  calculations is one which has been prevailing
in respect of the  relevant  employee  for at least six months  prior to
termination.   This  indemnity   shall  not  extend  to  any  losses  or
liabilities, costs

(including without limitation legal costs) charges,  expenses,  actions,
proceedings,  claims and demands  which the Purchaser or the Company may
incur as a result of its or their  negligence  or  default.  Any  claims
under  this  indemnity  must be made  within  4 years  and 3  months  of
Completion following which this indemnity shall have no effect.

8.7 The Seller shall not be required to make any payment under the indemnity
set out in sub  clause 8.6  unless a draft  certificate  shall have been
delivered to it by the Purchaser within 30 days after the date requiring
the Seller to indemnify  the Purchaser  pursuant to  sub-clause  8.6 and
certifying the amount payable thereunder.  In order to enable the Seller
to review  the  certificate,  the  Purchaser  shall (to the extent it is
permitted by law to do so) make  available and supply to the Seller and,
at the Seller's request and expense,  the Seller's  auditors,  copies of
all relevant  records and other working papers)  relating to the subject
matter of the indemnity, during normal office hours.

8.8 If the Seller  does not within 30 days after  presentation  to it of the
draft  certificate  give notice to the Purchaser  that it disagrees with
the certificate or any item thereof, such notice stating the reasons for
the  disagreement  in reasonable  detail,  the draft  certificate  shall
become final and binding on the parties for all purposes.

8.9 If the Seller  gives a valid  notice  within  such 30 days,  the parties
shall attempt in good faith to reach  agreement in respect  thereof and,
if they are unable to do so within 21 days of such notification,  either
party  may  by  notice  to  the  other  refer  the  certificate  to  the
Independent  Accountants in accordance  with the provisions of clause 11
of this agreement which shall apply mutatis mutandis,  references to the
"COMPLAINANT"  being  deemed  to  be  references  to  the  "SELLER"  and
references to the "OTHERS" being to the "PURCHASER".

8.10 The Seller  shall pay interest at the rate of LIBOR plus 200 basis point
compounded monthly on all payments pursuant to this clause from the date
of delivery of the draft certificate.

9 PROPERTY, ENVIRONMENTAL AND LOUISIANA GRANTS

9.1 The Seller and the Purchaser shall observe and perform the provisions of
Schedule  2  expressed  to be  observed  and  performed  by each of them
respectively.

9.2 The Seller and the Purchaser  shall observe the provisions of Schedule 5
expressed  to be observed and  performed  by each of them  respectively,
which shall apply only to the Business and not the LPC Interests or LPC.

9.3 The Seller and the Company shall  cooperate with the Purchaser in taking
reasonable  steps to transfer to the Purchaser  the ongoing  benefits of
the  applicable  Louisiana  Exemption  Grants  defined in  Section  5.1,
Article V, "TAX MATTERS OF THAT CERTAIN FORMATION AGREEMENT" dated as of
October 18, 1993 between Affiliates of the Purchaser and the Seller.

10 PENSIONS

10.1 The Purchaser  agrees to procure that the Company will,  commencing with
the Completion Date, respect and perform the provisions of the Scheme.

10.2 Subject to the payment of the transfer  amount,  as described below, the
Purchaser  will  provide  retirement  benefits  for Mr J Gush and Mr S G
Heyes  in  respect  of  their  service  with the  Company  on and  after
Completion so that, in each case,  their total  benefits on  retirement,
leaving  service  or  death   (inclusive  of  any  retirement   benefits
attributable  to service up to  Completion)  are as  described  in their
retirement  benefit profiles in the Agreed Form. The Purchaser will also
nominate  retirement  benefits  arrangements to which a transfer payment
can be made from the Tioxide Offshore Pension Fund.

10.3 The Purchaser shall indemnify the Seller (for itself and its Affiliates)
on a continuing  basis  against any and all losses,  liabilities,  costs
(including without limitation legal costs), charges, expenses,  actions,
proceedings,  claims and demands which the Seller or its  Affiliates may
incur and which  relate to or arise out of any failure by the  Purchaser
to comply with these obligations.

10.4 The  Seller  (or  its  relevant   Affiliate)  will  use  its  reasonable
endeavours  to procure  payment of a transfer  amount  from the  Tioxide
Offshore Pension Fund to the arrangements nominated by the Purchaser.

10.5 The transfer amount will be:

10.5.1 based on  benefits  accrued  by Mr Gush and Mr  Heyes  under  the
Tioxide  Offshore Pension Fund for service up to Completion (i.e.
excluding  benefits earned under all other Tioxide plans in which
they have participated); and

10.5.2 calculated  on a past service  reserve  basis using the projected
unit method, based on salaries projected to retirement or earlier
date of leaving or death, using the actuarial assumptions set out
in the actuarial  valuation of the Tioxide  Offshore Pension Fund
as at 1 April 1997 and will be  adjusted  as agreed  between  the
Seller and the Purchaser for the period  between  Completion  and
the date of payment.

10.6 If an appropriate  transfer  amount cannot be agreed within three months
after  Completion,  either party may require the amount to be determined
by an  independent  actuary,  to be  nominated  by the  Seller  and  the
Purchaser  jointly,  or if they cannot  agree,  by the  President of the
Institute of Actuaries on application by either party.  The  independent
actuary will act as an expert and not as an arbitrator, and his decision
will be final and  binding  on the  parties.  His costs  will be payable
equally by the Seller and the Purchaser.

10.7 If the trustee of the  Tioxide  Offshore  Pension  Fund does not pay the
transfer  amount in full by a date one month  after the date on which it
is agreed (or decided by the independent  actuary),  the Seller will pay
to the Purchaser the amount of the shortfall by way of adjustment to the
Final Consideration.  However, the Seller will not be required to pay an
amount in excess of the net cost to the Purchaser or the Company  (after
taking  account of tax) of making good the shortfall by a payment to the
arrangements.

11 INDEPENDENT ACCOUNTANT

11.1 If either party wishes to refer any matter in dispute in accordance with
the  provisions of Clause 3 or Schedule 6 for  determination  under this
Clause it shall give notice to the other requiring the appointment of an
independent   accounting   firm   of   international   reputation   (the
"INDEPENDENT  ACCOUNTANT")  excluding accounting firms who have acted as
auditors of either party or of any of their  Affiliates in the last five
years.  If  the  parties  are  unable  to  agree  upon  the  Independent
Accountant  within  14  days  of  such  notice,   then  the  Independent
Accountant shall be appointed by the President for the time being of the
Institute  of  Chartered   Accountants  in  England  and  Wales  on  the
application of either party.

11.2 If the Independent  Accountant  delays or becomes unwilling or incapable
of acting or if for any other reason the President for the time being of
the Institute of Chartered  Accountants  in England and Wales thinks fit
he may  discharge  the  Independent  Accountant  and,  in the absence of
agreement between the parties, appoint another in its place.

11.3 The  Independent  Accountant  shall  act  as an  expert  and  not  as an
arbitrator and his decision shall (in the absence of manifest  error) be
final and  binding on the  parties.  The  Independent  Accountant  shall
afford the parties the opportunity of making written  representations to
them and shall make its determination within 40 days of its appointment.

11.4 The fees and expenses of the  Independent  Accountant  shall be borne by
the parties in equal shares unless the Independent Accountant determines
otherwise.

12 PROTECTIVE COVENANTS

12.1 The Seller  covenants  with the Purchaser that no member of the Seller's
Group will:

(a)    for a period of five years from Completion within any part of the
Territories  carry on or be engaged or  involved  in the Field of
Activity  (save as the  owner  for  investment  purposes  only of
securities   traded  on  a  recognised  stock  exchange  and  not
exceeding one per cent. of the securities of that class); or

(b)    without prior  approval from the  Purchaser,  for a period of two
years  from  Completion,   directly  or  indirectly  solicit,  or
endeavour to entice away from the Purchaser or its Affiliates any
of the Employees.

12.2 Each of the  restrictions  in sub-Clause 12.1 above shall be enforceable
independently  and its  validity  shall not be  affected if the other is
invalid.

12.3 The Seller  acknowledges  that the  provisions  of this Clause 12 are no
more extensive than is reasonable to protect the Company.

12.4 Nothing in this Clause 12 or in this agreement shall prevent:

(a)    the  Seller  or its  Affiliates  from  purchasing  shares  in any
company or any  business  which has an  interest  in the Field of
Activity  (the  ownership  of which  would  otherwise  contravene
sub-Clause   12.1)   unless  the  turnover  of  such  company  or
business in its last  accounting  year  generated by its interest
in the Field of  Activity  was the  greater of 10 per cent of the
aggregate  turnover  of  such  company  or  business  and  US$100
million.  In the event that the  Seller or any of its  Affiliates
within five years from  Completion  purchases any  corporation or
business  which  does have  interests  in the Field of  Activity,
the Seller or the relevant  Affiliate are  contractually  obliged
to offer for sale such interests to DuPont.

If DuPont does not purchase  such  interests  from the Seller (or
its relevant  Affiliate),  the Seller (or the relevant Affiliate)
shall,  if  DuPont  shall  fail to or does not  accept  the offer
referred to above  within such period to which it is entitled for
such  purpose,  within 30 days of receipt  from  DuPont of notice
that DuPont does not intend to purchase such interests  offer for
sale such  interests to the  Purchaser on terms which are no less
favourable by written notice ("OFFER NOTICE").

If the Purchaser does not unconditionally purchase such interests
from the Seller (or its relevant  Affiliates)  within a period of
18 months after the date of the Offer Notice,  the Seller (or the
relevant  Affiliate)  shall be free to retain such interests with
the consent of the Purchaser (such consent not to be unreasonably
withheld or delayed). If such consent is reasonably withheld, the
Seller (or the relevant  Affiliate) shall use its best endeavours
to divest such interests  within 12 months of such consent having
been withheld; or

(b)    the Seller or its Affiliates from carrying on or being engaged or
involved in:

(i) any  business  it  currently   carries  on  (other  than  the
Business);

(ii)any  business  which  only  supplies  other  members  of  the
Seller's Group; or

(iii) any  business  after  such  time  as the  Purchaser  or its
Affiliates  have ceased to carry on or be engaged or involved
in such business other than by way of trade sale.

13 ANNOUNCEMENTS

The parties  agree that neither party shall make or permit any member of
the Seller's Group or the Purchaser's Group, as the case may be, to make
any  announcement  concerning  this  agreement or any  ancillary  matter
except as required by law or any competent  regulatory  body or with the
prior written approval of the other party which will not be unreasonably
withheld or delayed.

14 DEFAULT INTEREST

Subject as otherwise provided to the contrary in this agreement,  if any
sum due for payment  under this  agreement  or in  accordance  with this
agreement  is not paid on the due date,  the party in default  shall pay
Default  Interest on that sum from the due date until the date of actual
payment calculated on a day-to-day basis.

15 NOTICES

15.1 Any notice or other document to be served under this agreement  shall be
in writing and may be delivered by hand or by courier, sent by fax or by
post  to the  party  to be  served  at its  address  appearing  in  this
agreement  (and  marked for the  attention  of the person  whose name is
referred  to in  sub-Clause  15.3  below) or at such other  address  (or
marked for the  attention of such other  person) as it may have notified
to the other  party in  accordance  with this  Clause  15. Any notice or
other  document sent by post shall be sent by  registered  post (if both
posted and for delivery within the same  jurisdiction)  or by registered
airmail (if posted for delivery  outside the jurisdiction in which it is
posted),  in either case return receipt  requested (or any substantially
equivalent service).

15.2 Any notice or document  delivered or sent in accordance  with sub-Clause
15.1   shall be deemed to have been served:

15.2.1 if delivered by hand or by courier, at the time of delivery; or

15.2.2 if sent by fax,  at the time of delivery  if sent  between  12.01
a.m.  and 6.00 p.m.  (local  time at the  destination)  or on the
Business Day after transmission, if sent at any other time;

15.2.3 if posted,  at 10.00 a.m. on the second Business Day after it was
put  into  the  post if  posted  for  delivery  within  the  same
jurisdiction, or at 10.00 a.m. (local time at the destination) on
the  fifth  Business  Day after it was put in the post if sent by
registered airmail.

15.3 The person to whom  notices or  documents  should be  addressed  for the
purposes of sub-Clause 15.1 is:

(a)    if to be served on the Seller or on Affiliates of the Seller:

[     *     ]

Fax: [     *     ]

copy to the Company  Secretary  of Imperial  Chemical  Industries
PLC of Imperial Chemical House, 9 Millbank, London, SW1P 3JF

Fax: (44) 171 798 5170

(b)    if to be served on the Purchaser:

General Counsel
NL Industries, Inc.
16825 North Chase Drive
Suite 1200
Houston, Texas USA TX 77060

Fax: (1) 281 423 3333

15.4 In proving  service of a notice or  document it shall be  sufficient  to
prove  that  delivery  was  made by  hand,  courier  or fax or that  the
envelope  containing  the notice or document was properly  addressed and
posted (either by registered post or by registered  airmail, as the case
may be, in accordance with the requirements of this Clause 15).

16 GENERAL

16.1 Each of the  obligations,  Warranties and  undertakings  set out in this
agreement  which is not fully  performed at Completion  will continue in
force after Completion.

16.2 Unless  otherwise  expressly  stated all claims made and  payments to be
made under this agreement  shall be made in US Dollars.  Payments to the
Seller shall be made in  immediately  available  funds to the account of
the Seller at such account as the Seller may notify to the Purchaser and
to the Purchaser in immediately  available  funds to such account as the
Purchaser  may notify to the Seller.  All payments and values under this
agreement  shall be in US  Dollars  and where an  amount  is not  itself
calculated in US Dollars,  it shall be converted  into US Dollars at the
mid-market  closing  exchange  rate for that  currency  in US Dollars as
published in the London  Edition of the  Financial  Times  published two
Business Days prior to the date on which the relevant  payment is due or
where no such rate is published, at the rate quoted by Citibank, N.A. at
the close of business in London on that date. This sub-Clause  shall not
apply to Schedule 6.

16.3 Save as  otherwise  provided  to the  contrary in this  agreement,  each
payment to be made under this agreement shall be made in the currency in
which the relevant  amount is payable,  free and clear of all deductions
or  withholdings  of any kind,  except for those required by law, and if
any deduction or withholding  must be made by law, an additional  amount
will be paid which is necessary to ensure that the recipient  receives a
net amount equal to the full amount which it would have  received if the
payment had been made without the deduction or withholding.

16.4 None of the rights or  obligations  under this agreement may be assigned
or  transferred  without  the  written  consent of the other  party (the
"NON-ASSIGNING  PARTY")  other than an assignment of the rights (but not
the obligations) to an Affiliate of the assigning party provided that:

(a)    such assignment  shall only be permitted if the assignment has no
adverse effect on the Non-assigning Party;

(b)    if the Affiliate to which the rights have been assigned ceases to
be an Affiliate  of the  assigning  party,  the rights which have
been  transferred  shall be  re-transferred  to the  party  which
originally  assigned those rights or to another Affiliate of that
original assigning party; and

(c)    it shall be a condition of any such  assignment  that  reasonable
notice  is given in  writing  to the  Non-assigning  Party of the
proposal  to  assign  (identifying  the  rights  proposed  to  be
assigned,  the identity of the  proposed  assignee and such other
details   relating  thereto  as  the   Non-assigning   Party  may
reasonably require).

16.5 Save as otherwise  provided in this agreement,  each party shall pay the
costs and expenses  incurred by it and its Affiliates in connection with
the entering into and completion of this agreement.

16.6 This  agreement  may be executed in any number of  counterparts,  all of
which taken together shall constitute one and the same agreement and any
party may enter into this agreement by executing a counterpart.

16.7 No amendment,  variation or waiver of this agreement or any provision of
this agreement shall be effective  unless it is in writing  specifically
referring to this  agreement  and duly  executed by or on behalf of both
parties.

16.8 Both  parties  shall at their own  expense at all times from the date of
this  agreement  do all things as may be required to give effect to this
agreement including,  without limitation, the execution of all deeds and
documents,  procuring the  convening of all meetings,  the giving of all
waivers and consents and the passing of all  resolutions  and  otherwise
exercising all powers and rights available to them.

16.9 The  Seller  and the  Purchaser  agree to make a timely,  effective  and
irrevocable  election under Section 338(h)(10) of the Code and under any
comparable  statutes  in any  other  jurisdiction  with  respect  to the
Company (the "SECTION 338(H)(10)  ELECTION"),  and to file such election
in  accordance  with  applicable   regulations.   Without  limiting  the
generality  of the  foregoing,  in order to effect  such  election,  the
Seller and the Purchaser shall jointly  execute the necessary  copies of
IRS Form  8023 and  attachments  required  to be  filed  therewith.  The
Section 338(h)(10)  Election shall properly reflect the Price Allocation
(as hereinafter defined).  Within 45 days after the Completion Date, the
Purchaser  shall  deliver to the  Seller a  statement  (the  "ALLOCATION
STATEMENT")  allocating  the modified  ADSP (as such terms is defined in
Treasury  Regulations Section  1.338(h)(10)-1)  (the "MODIFIED AGGREGATE
DEEMED  SALES  PRICE") of the assets of the Company in  accordance  with
this Agreement and the Treasury  Regulations  promulgated  under Section
338(h)(10).

The Seller shall have the right to review the Allocation  Statement.  If
within 30 days after  receipt of the  Allocation  Statement,  the Seller
notifies the  Purchaser in writing  that the  allocation  of one or more
items  reflected  in  the  Allocation  Statement  is  not  a  reasonable
allocation, the Purchaser and the Seller will negotiate in good faith to
resolve such  dispute.  If the  Purchaser and the Seller fail to resolve
such dispute within 30 days, the Independent  Accountant shall determine
whether the  allocation  was reasonable  and, if not  reasonable,  shall
appropriately  revise the Allocation  Statement.  If the Seller does not
respond within 30 days, or upon  resolution of the disputed  items,  the
allocation  reflected on the Allocation Statement (as such may have been
adjusted)  shall be the "PRICE  ALLOCATION"  and shall be binding on the
parties hereto.  The Seller and the Purchaser agree to act in accordance
with the Price  Allocation in the  preparation of financial  statements,
filing and audit of any Tax return.

17 WHOLE AGREEMENT

17.1 Subject  to  sub-Clause  17.2  below,  this  agreement,   the  Framework
Agreement  and the  Implementation  Agreements  (if and  when  executed)
contain the whole  agreement  between  the parties and their  respective
Affiliates  relating to the transactions  contemplated by this agreement
and the Implementation  Agreements and supersede all previous agreements
between  the parties and their  respective  Affiliates  relating to such
transactions.

17.2 A provision in another  agreement  between the parties to this agreement
or between  the  respective  parent  undertakings  of the  parties  (and
whether made before or after the date of this agreement) which refers to
this  agreement and which extends or  supplements  any provision in this
agreement  will be deemed for the purposes of  sub-Clause  17.1 above to
form part of the whole  agreement  between the parties as referred to in
that sub-Clause.

17.3 Each of the parties to this agreement acknowledges on its own behalf and
on behalf of each of its Affiliates that, in agreeing to enter into this
agreement and the  Implementation  Agreements,  it has not relied on any
representation, warranty, collateral contract or other assurance (except
those set out in this  agreement)  and waives  all  rights and  remedies
which,  but for this  sub-Clause,  might otherwise be available to it in
respect of any such  representation,  warranty,  collateral  contract or
other  assurance,  provided  that  nothing in this Clause shall limit or
exclude any liability for fraud.

18 GOVERNING LAW

This agreement is governed by and shall be construed in accordance  with
English law.

19 JURISDICTION

19.1 The  parties  agree,  subject  to  sub-Clause  19.2,  to  submit  to the
exclusive  jurisdiction  of the courts of the State of Delaware  for all
purposes relating to this agreement.

19.2 If the courts of the State of Delaware decline jurisdiction, the English
courts shall have exclusive  jurisdiction  for all purposes  relating to
this agreement.

19.3 In both sub-Clauses  19.1 and 19.2,  neither party shall take any action
to avoid,  dispute or suggest  to such court that such  jurisdiction  is
improper.

19.3 If the English  courts have  jurisdiction,  ICI American  Holdings  Inc.
irrevocably  appoints  Imperial  Chemical  Industries  PLC  of  Imperial
Chemical House 9, Millbank,  London SW1P 3JF as its agent for process in
England and the Purchaser  irrevocably  appoints Herbert Smith (Ref 554)
of Exchange House,  Primrose Street,  London,  EC2A 2HS as its agent for
process in England.

AS  WITNESS  the  hands of the duly  authorised  representatives  of the
parties on the date which first appears on page 1.

SCHEDULE 1
PARTICULARS OF THE COMPANY

Date and Place of
Incorporation:             11 August 1971, Dover, Delaware, USA

Registered Office:         2001 Butterfield Road, Suite 601,
Downers Grove,
IL 60515 USA

Authorised Share Capital:  11,000 Common stock of US$1 par value

Shareholders and Issued    10,750 Shares of US$1 each owned by
Share Capital:             ICI American Holdings Inc.

Directors:                 J.A. Collingwood
G. Gauthier
R. Lachance

Secretary:                 R. Lachance

SCHEDULE 2
PROPERTY
(CLAUSE 1)
PART I

ADDRESS                               ESTATE OR INTEREST           USE
2001 Butterfield Road,                Leasehold                  Offices
Suite 601, Downers Grove
Illinois 1660515

PART II

On  Completion,  the Seller  shall  deliver to the  Purchaser  all title
documentation  (and other  documentation  disclosed to the Purchaser) in
connection with the Property.

SCHEDULE 3.1
WARRANTIES WITH RESPECT TO THE BUSINESS
AND TO THE SALE SHARES ONLY

A. GENERAL

A.1 CAPACITY AND CONDUCT OF BUSINESS

(1) The Seller (and each of its Affiliates in respect of the  Implementation
Agreements  to which  they are  parties)  has the  requisite  power  and
authority to enter into and to (otherwise as provided in this agreement)
perform this agreement and such Implementation Agreements.

(2) The Seller (and each of its Affiliates, in respect of the Implementation
Agreements  to which they are parties) has  obtained and  satisfied  all
corporate,  regulatory and other  approvals,  and any other  conditions,
necessary  to execute and  (otherwise  as  provided  in this  agreement)
perform this agreement and the Implementation Agreements.

(3) This  agreement and the  Implementation  Agreements  constitute (or when
executed will  constitute)  valid and binding  obligations of the Seller
(and each of its Affiliates in respect of the Implementation  Agreements
to which they are parties) enforceable in accordance with their terms.

(4) The execution  and  compliance  with the terms of this  agreement by the
Seller and the Implementation Agreements by the Seller or its Affiliates
(as appropriate) will:

(a) not constitute a breach of any material contract to which the
Seller (or any of its  Affiliates)  is a party or by which it
or they are bound or entitle any person to terminate or avoid
any such agreement or contract;

(b) be  in  compliance   with  the  Seller's  and  the  Company's
memorandum    and   articles   of    association   or   other
constitutional documents (or those of any of its Affiliates);

(c) not contravene:

(i)  any order, judgment or decree; or

(ii) any statute, rule or regulation;

(iii)any other  restriction  of any kind by which the  Seller
or any of its Affiliates or the Company is bound; or

(d) not result in the loss or  impairment of or any default under
any licence, authorisation or consent required by the Company
for the purposes of its business.

(5) All factual  information  contained  in this  agreement  relating to the
Company is true and accurate in all material respects.

(6) There are no  outstanding  powers of attorney  executed on behalf of the
Company.

A.2 THE COMPANY

(1) The  information  relating  to the  Company  contained  in Schedule 1 is
true and accurate.

(2) Compliance has been made with all legal  requirements in connection with
the  formation  of the  Company  and all  issues  and  grants of shares,
debentures or other securities of the Company.

A.3 OWNERSHIP OF THE SALE SHARES

(1) The Seller is the sole legal and  beneficial  owner of the Sale  Shares.
The Sale  Shares  constitute  the  entire  issued  share  capital of the
Company.

(2) The Seller is  entitled  to sell and  procure  the  transfer of the full
legal  and  beneficial  ownership  in the  Sale  Shares  free  from  any
encumbrance,  equity  or  third  party  right  of  any  kind  or  nature
whatsoever,  from any  agreement  or contract to grant the same and from
any claim to any of the same.

(3) The Sale  Shares  are fully  paid up or  credited  as fully  paid up and
constitute  the whole of the issued and allotted  share capital owned by
the Seller in the Company.

(4) No agreement  or contract  has been  entered into which  requires or may
require the Company to allot or issue any share or loan  capital and the
Company has not allotted or issued any securities  which are convertible
into share or loan  capital and there are no voting  trusts,  proxies or
other  agreements  or  understandings  with respect to the voting of the
Sale Shares.

A.4 SUBSIDIARIES

(1) The Company is not the holder or beneficial  owner of (nor has agreed to
acquire) any class of any shares or loan capital or other  securities of
any other  corporation  (whether  incorporated  in the United  States of
America or elsewhere).

(2) Other than with  respect to its  interest in LPC, the Company is not and
has  not  agreed  to  become  a  member  of  any  partnership  or  other
unincorporated  association,  joint  venture or  consortium  (other than
recognised trade associations).

(3) The  Company   does  not  have  any  place  of  business  or   permanent
establishment   (as  that  expression  is  defined  in  double  taxation
conventions) outside the United States of America.

A.5 OWNERSHIP OF ASSETS

(1) Except  for the LPC  Interests  and those  assets  that are  leased  (as
described  in the  Disclosure  Letter)  the  Company  has full legal and
beneficial  title  to  all  assets  (whether   tangible  or  intangible)
reflected in the US Financial  Information  (save for current assets and
fixed  assets  worth  less  than  US$100,000,  both as  defined  for the
purposes of the US Financial Information,  disposed of by the Company in
the Ordinary  Course of its Business  since 28 February 1998) and to all
assets acquired by the Company since 28 February 1998.

(2) None of the  Assets is subject to any  encumbrance  (including,  without
limitation,  any debenture,  mortgage, charge, lien (other than any such
lien  arising  by  operation  of law or by  statute),  deposit by way of
security,  bill of sale,  option or right of  pre-emption)  except those
that arise in the Ordinary Course of Business and do not have a material
adverse  effect  on the  Business.  All  significant  items of Plant and
Equipment  have been  regularly  and  adequately  maintained  where such
maintenance  is normally  required and are in  reasonable  working order
having  regard to their age and use and taken as a whole are  capable of
operating the Business fully and effectively as conducted by the Company
prior to Completion.

(3) Save for  fluctuations  and  variations in Stock due to normal  business
factors including,  without limitation,  production schedules and market
demand  (including  seasonal  factors  affecting the same) the Stocks in
aggregate comprise broadly the same mix of products as has been required
and has been maintained at levels  sufficient to meet the level of sales
of the  Business for the last four  quarters.  The Stock is owned by the
Company free and clear of all liens,  claims,  charges and  encumbrances
other than any such liens arising by operation of law or by statute. The
Stock is located at the  Property  and as  disclosed  in the  Disclosure
Letter.

(4) The  Company  owns or has the right to use all the  property  rights and
assets  necessary for the Company to carry on fully and  effectively the
Business  in the  manner  and to the  extent  to which  it is  presently
conducted.

(5) The  Business  Data taking into  account the time,  purpose,  nature and
context in which it was prepared is in all material respects a bona fide
and  accurate  record  and  in  the  Seller's  opinion  is  collectively
sufficient for the purposes of conducting the Company's  business in the
Ordinary  Course  of  Business.  The  Business  Data  and the  Company's
information,  and the means of access to them, are exclusively  owned by
it and under its direct control or are under its authority.

(6) The  Disclosure   Letter  contains  details  of  the  current  insurance
arrangements applicable to the Business.  Those arrangements are in full
force and effect,  all  premiums  have been duly paid and, so far as the
Seller is aware, nothing has been done or omitted to be done which would
make any policy of insurance  of the Company void or voidable.  There is
no claim outstanding under any such arrangement.

A.6 COMPLIANCE WITH STATUTES

The Company has complied  with all  applicable  laws  (including  rules,
regulations  both  having  the  force  of law,  injunctions,  judgments,
orders,  decrees,  rulings, and charges thereunder) of national,  local,
and foreign governments (and all agencies thereof), and no action, suit,
proceeding, hearing, investigation, charge, claim, demand, or notice has
been filed or commenced  against the Company  alleging any failure so to
comply.

A.7 LICENCES AND CONSENTS

The Company has all Permits  necessary to own and operate its Assets and
to carry on the  Business  in the manner in which such  business  is now
carried  on. All such  Permits  are valid and  subsisting  and have been
complied  with in all material  respects.  The Company has paid all fees
due under the same. A list of material  Permits has been  disclosed  and
identified  in the  Disclosure  Letter  and the  list  identifies  those
material  Permits which allow for  revocation on a change in controlling
shareholder.

A.8 LITIGATION

(1) The Company is not engaged in any litigation or arbitration  proceedings
except as plaintiff for  collection  of debts in the Ordinary  Course of
Business which is likely to involve the Company  claiming or paying sums
in excess of US$100,000 or which  otherwise will have a material  effect
on the  operation  of the Company and the Business and there are no such
proceedings pending and no letter before action has been received by the
Company and so far as the Seller is aware  there are no facts  likely to
give rise to any such  proceedings.  The  Seller  has  disclosed  in the
Disclosure Letter a list (which is complete and accurate in all material
respects)  which includes a description of each pending law suit,  claim
(including    customer    complaints),    administrative    proceedings,
arbitration,  labour dispute or governmental investigation or inspection
to  which  the  Company  is a party or  involves  the  operation  of the
Business or involves the Sale Shares and in each case which is likely to
involve the Company claiming or paying sums in excess of US$100,000. The
Seller has disclosed  all material  (individually  or in the  aggregate)
product liability claims received by the Company or by the Seller during
the last  three  years.  There  are no  orders,  decrees,  judgments  or
agreements with any Court or governmental authority to which the Company
or the  Seller  (on  behalf of the  Company)  is a party or by which the
Company or the Seller or the Sale Shares are bound and which will have a
material effect on the operation of the Company and its business.

(2) No  administrator,  receiver  or  administrative  receiver  or any other
equivalent  officer has been  appointed  in respect of the Company or in
respect of any parts of the assets or undertakings of the Company.

(3) No petition has been  presented,  no order has been made,  no resolution
has been passed and no meeting has been  convened for the  winding-up of
the Company or for an administration order to be made in relation to the
Company nor has any such order been made.

(4) No  voluntary  arrangement  has  been  approved  and  no  compromise  or
arrangement  has been  sanctioned in respect of the Company  pursuant to
any applicable bankruptcy or insolvency legislation.

(5) The Company has not become unable to pay its debts.

(6) No distress,  distraint,  charging order,  garnishee order, execution or
other  process has been levied or applied for in respect of the whole or
any  part  of any of the  property,  assets  and/or  undertaking  of the
Company.

A.9 ENVIRONMENTAL MATTERS

(1) Environmental Authorisations

(a) The  Company  has   lawfully   obtained   all   Environmental
Authorisations  and each such  authorisation is in full force
and effect and the Company has complied at all times with and
can continue to comply in the future with all  conditions  of
such authorisations.

(b) No works or  costs  are or will be  necessary  to  obtain  or
secure compliance with or maintain any existing Environmental
Authorisations  or their  conditions  or  otherwise to comply
with Environmental Laws.

(c) The Company  has  received  no  communication  in any form in
respect of any Environmental Authorisation varying, modifying
in any material respect,  revoking,  suspending or cancelling
the same or indicating an intention or  threatening  so to do
and there  are no facts or  circumstances  which  the  Seller
knows or ought  reasonably  to know which will  result in any
Environmental   Authorisation  being  so  varied,   modified,
revoked, suspended or which may prejudice their renewal.

(d) The Seller or the Company has taken all  necessary  action in
connection with the renewal or extension of all Environmental
Authorisations.

(e) The  Company is not  engaged in and,  so far as the Seller is
aware,  there are no facts which make it likely or  desirable
that it should be  engaged  in any  appeal in  respect of any
Environmental   Authorisation  or  any  conditions  contained
therein or any refusal of any Environmental Authorisation.

(f) So far as the Seller is aware or ought to be aware,  there is
no reason  (other than reasons  relating to the  Purchaser or
its   Affiliates)   to  believe   that  those   Environmental
Authorisations which have been applied for but which have not
yet been granted or are pending will not be granted  within a
reasonable  period of time and on terms which are  acceptable
in order for the  Company to continue  its  current  business
operations.

(g) So far as the  Seller  is aware or  ought  to be  aware,  the
execution and/or  performance of this agreement and all other
documents  which are to be  executed at  Completion  will not
result  in any  Environmental  Authorisations  being  varied,
modified, revoked, suspended, cancelled or not renewed, other
than for reasons relating to the Purchaser or its Affiliates.

(2) Compliance with Environmental Laws

(a) The Company,  in relation to the  Business,  is in compliance
with Environmental Laws and the state and use of the Property
have been at all times in conformity with Environmental Laws.

(b) The Company,  in relation to the  Business,  has not received
any  communication  in any form from any competent  authority
requiring  the taking of  remedial or other steps in relation
to the  pollution or  protection  of the  Environment  or the
state or use of the Property.  So far as the Seller is aware,
there  are no  circumstances  which  might  give rise to such
communications  being received and the Seller is not aware of
any intention on the part of any such  authority to give such
notice.

(c) In relation to the Business,  no proceedings or other action,
claim or  investigation  are or have been in  existence or so
far as the Seller is aware pending or threatened  against the
Company  arising  from or in  relation  to any  Environmental
Authorisations or otherwise concerning Environmental Laws.

(3) Liability

(a) The Company or the Seller,  in relation to the Business,  has
not received  any notice or  intimation  of any  complaint or
claim from any person in respect of any matter concerning the
Environment.

(b) The Company or the Seller,  in relation to the Business,  are
not and have  not been  engaged  in any  action,  litigation,
arbitration or dispute resolution  proceedings relating to or
concerning   any   actual  or   potential   liability   under
Environmental  Laws and the  Seller  is not aware of any such
matters pending or being  threatened or of any  circumstances
or facts likely to give rise to any such matters.

(c) The Company or the Seller,  in relation to the Business,  are
not and have not been  subject to any  injunction  or similar
remedy or order by a court of competent  jurisdiction,  or to
any  undertakings  given  to such  court  in  respect  of any
matters relating to or concerning the Environment.

(4) As far as the  Seller is aware,  there has not been in  relation  to the
Business  in the last  three  years any  adverse  report,  complaint  or
investigation  or any  prosecution,  formal  caution or warning  for any
violation  of any  applicable  laws or  regulations  relating to health,
safety and the environment.

A.10 DATA ROOM DOCUMENTS

(1)    Save as disclosed in Schedule 6 of the Disclosure  Letter, so far
as the Seller is aware, each licence,  permit, contract, list and
report set out in Annex 6 and  disclosed  in the Data  Room,  and
identified  on Annex 6 by reference to the  reference  number set
out in the Data Room Index annexed to the Disclosure Letter:

(a) other than where redacted, is a true copy of the original;

(b) is the latest version thereof;

(c) is complete; and

(d) has not  been  altered,  amended  or  varied  since  the date
thereon.

(2)    To the extent that any note,  summary or response to questions of
or in respect of the  documents set out in Annex 6 referred to in
sub-Paragraph  A.10(1)  contains any expression of opinion of the
ICI Group (not  including  the  opinion of third  parties),  such
opinion  reflects  the  current  reasonably  held  opinion of its
author  given in good faith  taking into  account the  respective
author's knowledge and understanding.

B. US FINANCIAL INFORMATION

(1) The US Financial  Information  relating to the Business has been derived
from the books of the  Company,  which  books  have been  regularly  and
consistently kept and maintained using ICI's normal accounting  policies
and  practices as set out or referred to in ICI's  Controller's  Manuals
(and the policies  contained in these Manuals are in accordance  with UK
GAAP) as applied  by the  relevant  business  on a  consistent  basis in
accordance  with UK GAAP and, on such basis,  represents  the assets and
liabilities of the Business as at 28 February 1998.

(2) The US Financial  Information relating to the Business fairly represents
the matters presented therein. Since 28 February 1998 there has been:

(a)    no  material  change in any  accounting  or  inventory  valuation
methods used by the Company in connection with the Assets;

(b)    no upward revaluations of existing Stocks; and

(c)    no material adverse change in the Business or financial condition
of the  Company,  which for this  purpose  shall not  include the
inherently  cyclical nature of the titanium  dioxide  industry or
general economic conditions.

(3) Since [DATE OF FRAMEWORK AGREEMENT] 1998:

(i) the Company has not sold,  leased,  transferred,  or assigned
any of its assets,  tangible or intangible,  other than for a
fair consideration in the Ordinary Course of Business;

(ii)the  Company has not entered  into any  agreement,  contract,
lease,   or  licence   (or  series  of  related   agreements,
contracts,  leases and licences)  either  involving more than
US$1,000,000 within a 12 month period or outside the Ordinary
Course of Business;

(iii) no party  (including any of the Company's  Affiliates)  has
accelerated,   terminated,   modified,   or   cancelled   any
agreement,  contract, lease, or licence (or series of related
agreements,  contracts,  leases, and licences) involving more
than US$250,000 within a 12 month period to which the Company
is a party or is bound;

(iv)the Company has not  imposed or  permitted  another to impose
any  encumbrance   upon  any  of  its  assets,   tangible  or
intangible  other than those  arising by  operation of law or
statute;

(v) the Company has not made any capital  expenditure  (or series
of related capital  expenditures)  either involving more than
US$250,000 or outside the Ordinary Course of Business;

(vi)the Company has not made any capital  investment in, any loan
to, or any  acquisition  of the  securities or assets of, any
other person (or series of related capital investments, loans
and  acquisitions)  either  involving more than US$250,000 or
outside the Ordinary Course of Business;

(vii) other than to Affiliates of the Seller, the Company has not
issued any note,  bond,  or other debt  security  or created,
incurred,   assumed,   or  guaranteed  any  indebtedness  for
borrowed  money  or  capitalised   lease  obligation   either
involving more than US$250,000  singly or US$2,500,000 in the
aggregate;

(viii) the Company has not  delayed or  postponed  the payment of
accounts  payable  and other  liabilities  other  than in the
Ordinary Course of Business;

(ix)the  Company  has  not  cancelled,  compromised,  waived,  or
released any right or claim (or series of related  rights and
claims) either involving more than US$250,000;

(x) the Company has not granted any licence or  sublicence of any
rights under or with respect to any Intellectual Property;

(xi)there  has  been  no  change  made  or   authorised   in  the
constitutional documents of the Company;

(xii) the Company has not issued,  sold, or otherwise disposed of
any of its capital stock,  or granted any options,  warrants,
or  other  rights  to  purchase  or  obtain  (including  upon
conversion, exchange, or exercise) any of its capital stock;

(xiii) the  Company  has not  declared,  set  aside,  or paid any
dividend or made any distribution with respect to its capital
stock (whether in cash or in kind) or redeemed, purchased, or
otherwise acquired any of its capital stock;

(xiv) the Company has not experienced any damage, destruction, or
loss  (whether or not covered by  insurance)  to its property
involving sums in excess of US$250,000;

(xv)     the  Company  has  not  made  or  pledged  to  make  any
charitable   contribution  outside  the  Ordinary  Course  of
Business;

(xvi) the Company has not committed to any of the foregoing.

C. ANTI-COMPETITIVE ARRANGEMENTS

The  Company  or the  Seller,  in  relation  to the  Business,  have not
received  in the last 3 years  any  process,  notice  or  communication,
formal or informal,  from any anti-trust regulatory authority,  relating
to any aspect of the Business,  which  alleges any illegal  practices in
relation  to the  Business  and so far as the  Seller  is  aware no such
process, notice or communication is likely to be received.

D. MATERIAL CONTRACTS

(1) Particulars  of all  Material  Contracts  are annexed to the  Disclosure
Letter.

(2) The Company is not in breach of, or default  under,  any of the Material
Contracts or any other  Contracts the  consequence of which would or may
have a material  adverse effect on the Company and, so far as the Seller
is aware, no state of facts exists or event has occurred,  is pending or
is  threatened  which  after  the  giving of notice or the lapse of time
would or may constitute or result in a breach or a default by the Seller
or by the Company or any other person, firm, corporation or entity of or
in  relation  to any  contract  the  consequences  of which would have a
material effect on the operation of the Business. All Material Contracts
are  legal,  valid  and  binding  obligations  of the  Company  and  are
enforceable in accordance with their terms.

E. EMPLOYEES

(1) Particulars  of the material  terms of  employment  of all Employees and
officers of the Company  are annexed to the  Disclosure  Letter and such
particulars are true, complete and accurate.

(2) No Employee  has given to the  Company and the Company has not  received
from any Employee, nor has the Company given to any Employee,  notice of
termination of any such Employee's employment.

(3) Standard  form  consultancy  agreements,   agency  or  self-employed  or
contracted  labour  agreements  or  contracts  where  sums in  excess of
US$75,000  per annum are paid or are  payable by the  Company  have been
disclosed in the Disclosure Letter.

(4) So far as the Seller is aware, there is no material industrial action by
the Employees  pending or threatened in relation to the Business nor has
there been within the last 12 months.

(5) Particulars  of all loans  made by the  Company to  Employees  and which
shall remain  outstanding at Completion,  together with sums owed by the
Company to any Employee (other than  remuneration and other  contractual
or customary benefits) are disclosed in the Disclosure Letter.

(6) No Employee of Grade 37 or above previously  employed by the Company has
a right to return to work or any right to be reinstated or re-engaged by
the Company, whether under statute or otherwise.

(7) No Employees  previously  employed by the Company have a right to return
to work or any right to be  reinstated  or  re-engaged  by the  Company,
whether under statute or otherwise.

(8) In relation to the  Employees,  there are no existing nor, so far as the
Seller is aware,  threatened  arbitration  procedures  arising out of or
under any union  recognition  or works  council  agreement  covering the
Employees nor, so far as the Seller is aware,  does any basis  therefore
exist  nor has the  Seller  or the  Company  received  any  request  for
recognition  or   representation   by  any  trade  union  not  currently
recognised at the Property.

(9) The Company has complied in all  material  respects  with all  statutes,
regulations,  orders and codes of conduct  relating  to  employment  and
relations  with  Employees and trade unions and has  maintained  records
required by law regarding the service of each of its Employees.

(10) The  Disclosure  Letter  contains a list of  Employees  at the  Property
together with a list of Employees below Grade 37 and a list of Employees
above Grade 37. The Disclosure  Letter also contains a list of Employees
of the Company who are employed at locations other than at the Property.

(11) So far as the Seller is aware here are no material complaints,  disputes
or grievances pending or threatened against the Company of any nature in
relation to its Employees or former Employees.

(12) All of the Employees are employed by the Company.

(13) The Company has discharged  such  obligations to Employees in respect of
salaries, wages, commissions, bonuses, overtime pay and holidays as have
accrued and become payable to Employees in accordance with the Company's
normal pay policies, including the normal timing of such payments, as at
the date hereof.

For the purposes of this Part E, "GRADE 37" refers to a particular grade
of employee, as determined by the Company,  using the Hay-MSL evaluation
system.

F. PENSIONS

In this Part F, "SCHEME  DOCUMENTS" means the documents  relating to the
Scheme identified in the Disclosure Letter.

(1) Except  pursuant  to the Scheme,  the Company has not paid,  provided or
contributed  towards,  and is not under any  obligation  (whether or not
legally  enforceable) to pay, provide or contribute towards any relevant
benefit  payable on death or retirement for or in respect of any present
or past officer or employee (or any spouse, child or dependant of any of
them) of the Company.

(2) The Scheme  Documents  comprise all the  documents  governing the Scheme
including financial  statements for the preceding period of three years,
all explanatory  booklets and announcements to the Employees  describing
the terms of the Scheme  (other  than  routine  benefit  statements)  of
current effect and full  particulars  of any  enhancement of benefit and
contributions  payable  to the  Scheme  and  there is no  obligation  to
provide or  continue  to provide  benefits  in respect of  Employees  or
former Employees of the Company under the Schemes other than as revealed
in the Scheme Documents.

(3) The Scheme has been registered as required under applicable legislation.

(4) The Scheme has at all times complied with the provisions of all relevant
statutes,  regulations and  requirements  and have been  administered in
accordance with the trusts, powers and provisions of the Scheme and with
due regard to the general  requirements of trust law and the advisers to
the Scheme have not had and do not have any cause to report any matter.

(5) The Company has complied in all material  respects with its  obligations
under the Scheme and all  amounts due to be paid to the Scheme by it and
its Employees have been paid.

(6) There are no claims or actions in progress, pending or threatened (other
than routine claims for benefits)  against the trustees of the Scheme or
the  Company  about  benefits  payable  under the  Scheme in  respect of
Employees or former Employees of the Company.

(7) All  information  of a factual nature made available to the Purchaser or
its advisers in  connection  with the Scheme is true and accurate in all
material respects and there is no omission therefrom.

(8) No proposal has been  announced to alter or  discontinue  the Scheme nor
has  any  proposal  which  is  legally  enforceable  been  announced  to
establish any retirement,  death or disability  agreement or arrangement
of the nature referred to in paragraph (1) above in respect of Employees
which proposal remains outstanding and has not been implemented.

(9) There is no amount which is due to the trustees of the Scheme.

G. PROPERTY

(1) The  Property  constitutes  all of the  freehold or  leasehold  or other
immovable  property  currently  owned by the  Company  or in  which  the
Company has an ownership interest.

(2) The  particulars  of the Property  shown in Schedule 2 (including in the
case of immovable property registration  particulars) are true, complete
and correct.  The use of the Property for the purpose stated in Schedule
2  corresponds  to the use to  which  it is in fact  put or  (where  the
Property  is not  presently  in use) to the use to  which it was last in
fact put.

(3) The  leasehold  interest  relating to the Property is held pursuant to a
valid and binding lease.

(4) The  Company  does not require  the use and is not in  occupation  of or
entitled to any estate or  interest  in any land or premises  other than
the Property. The Company is in exclusive occupation of the whole of the
Property and on Completion shall be in exclusive occupation of the whole
of the Property.

(5) The Property is not affected by any of the following matters:

(a) any easement, reservation, covenant, restriction,  agreement,
licence,  franchise,  mortgage, charge, encumbrance, or third
party right;

(b) any notice, order, proposal, dispute or complaint relating to
it or its  present  use  under  any  legislation,  agreement,
covenant, condition, licence or consent; or

(c) outgoings (other than uniform  business rates,  water charges
and other  standard  payments to the relevant  water  company
including,  without limitation,  insurance premiums and other
usual business expenses), whether of a periodically recurring
nature  or  otherwise  and  whether  payable  by the owner or
occupier of the relevant property.

(6) All obligations,  restrictions,  conditions and covenants (including any
imposed by or pursuant  to any lease but  excluding  any  referred to in
paragraph  A.9 above)  affecting  the  Property  have been  observed and
performed  so far as the  Seller is aware  and  there are no  subsisting
allegations  of a breach of any thereof  relating to the Property or its
present  use  under any  legislation,  agreement,  covenant,  condition,
licence or consent  other than those  referred to in paragraph A.9 or so
far as the  Seller is aware any  circumstance  which  might give rise to
such a breach.

(7) The Property is in a good and substantial  state of repair and condition
and fit for the purposes for which it is presently  used and the Company
has not used in the  Property  any  substances  not in  conformity  with
relevant  standards or codes of practice or which are generally known to
be deleterious  to health and safety and there are no uncompleted  works
of any description at the Property other than routine maintenance.

(8) There are no subsisting allegations that the use of the Property for the
purpose  stated  in  Schedule  2 is not  the  permitted  use  under  the
provisions of all relevant legislation.

(9) The Company has no liabilities or contingent  liabilities (but excluding
any  matters  referred  to in  paragraph  A.9  above) in  respect of any
properties  (other than the Property) (or any interest  therein) whether
by privity of contract or by way of guarantee or surety or otherwise.

(10) The  Property  has the benefit of all  rights,  easements  and  consents
required  for the  occupation  and  operation  of the  Property  for its
present  use and any plant,  machinery  and  processes  thereat and such
rights,  easements and consents are enjoyed on terms which do not permit
them to be determined by any third party or by effluxion of time.

(11) There are no  outstanding  liabilities  to make  payments  in respect of
rates,  water  charges,  or any other charges  payable in respect of the
Property  to  any  governmental,   state,  municipal  or  other  similar
authority.

H. INTELLECTUAL PROPERTY

(1) The rights licensed to the Company  pursuant to the US Name Agreement in
combination  with  all  rights  owned  by the  Company  in  Intellectual
Property  constitutes all the  Intellectual  Property  necessary for the
conduct of the Business by the Company as now conducted.

(2) The Seller does not have actual notice of any  infringement by others or
of attacks on the  validity  or  enforceability  of or on the  Company's
title to any Material  Intellectual  Property used in the Business.  The
Disclosure   Letter   identifies  all  patents,   patent   applications,
registrations   and   applications   for  registration  of  Intellectual
Property,  all Material  unregistered  trademarks,  service marks, trade
names and copyrights  owned by the Company.  "MATERIAL" in this Warranty
H(2) means  Intellectual  Property  the  absence  of which  would have a
significant negative impact on either (a) the revenue attributable to or
derived from the  Intellectual  Property or (b) otherwise on the conduct
of the Company's  business.  The Disclosure  Letter also  identifies the
status  of the  relevant  patents  and,  so far as the  Seller is aware,
whether or not such patents are currently being opposed.

(3) The Disclosure Letter identifies all information  technology used by the
Company  which is defined in the  Disclosure  Letter as being  "MATERIAL
INFORMATION TECHNOLOGY".

(4) The Seller does not have actual  knowledge and has not received  written
notification   that  the   activities  of  the  Business   infringe  the
Intellectual   Property  of  any  third  party  (the  Seller  having  no
obligation to conduct  investigations  in relation to any such potential
infringement).

(5) So far as the  Seller  is  aware  or ought  to be  aware,  all  Material
agreements relating to Intellectual  Property and Technical  Information
to which the  Seller is a party and  which  relate to the  Business  are
listed in the Disclosure Letter.  "MATERIAL" in this Warranty H(5) means
agreements relating to Intellectual  Property the absence of which would
have  a   significant   negative   impact  on  either  (a)  the  revenue
attributable  to or  derived  from  the  Intellectual  Property  or  (b)
otherwise on the conduct of the Company's business.

(6) All  Intellectual  Property  material  to the  conduct  of the  Business
immediately  prior to  Completion  will be owned or available for use by
the  Company  immediately  after  Completion.  For the  purposes of this
Warranty H (6), material has the same meaning as in Warranty H (2).

I. BROKERS

Neither the Seller nor the Company has employed any  investment  banker,
broker or finder or  incurred  any  liability  for any  brokerage  fees,
commissions,  finders fees or similar  payments in  connection  with the
transactions contemplated by this agreement for which the Purchaser, the
Purchaser's Affiliates, LPC or the Company may be liable.

J. TAXATION

(1) Tax Returns, disputes, records and claims etc.

(a) The Company has timely filed all proper  returns  required to
be made for any  Taxation  purpose and has supplied or caused
to be supplied all information required by law to be supplied
to any revenue authority.

(b) There is no dispute or  disagreement  (not including  routine
queries  relating  to the  Taxation  returns of the  Company)
outstanding  at the date of this  Agreement  with any revenue
authority  regarding  the  proper  method  of  computing  the
profits  of the  Company  (or any  part  of it) for  Taxation
purposes or the proper  treatment of any supplies of goods or
services  made (or  treated  as made)  by the  Company  or in
respect  of  any  other  Taxation  matter  and  there  are no
circumstances  of which  the  Seller is aware  which  make it
likely that any such dispute or  disagreement  will commence.
Without  prejudice to the generality of the foregoing,  there
is no current  investigation being undertaken by any Taxation
authority  and,  so far as the Seller is aware,  there are no
existing  circumstances which make it likely, in the event of
such an  investigation  taking place,  that a liability  will
arise.  There  are no liens  for Tax upon the  Assets  of the
Company, except liens for current Tax not yet due.

(c) The amount of Taxation  chargeable on the Company  during any
accounting  period  ending  on or  within  six  years  before
Completion  has not to any  material  extent  depended on any
concession,   agreement,   dispensation   or   other   formal
arrangement with any revenue authority in circumstances where
either:

(i) the   availability  of  any  such   arrangement  will  be
prejudiced  as a result of the  change of  control of the
Company resulting from this agreement; or

(ii)the  Company has not acted in  accordance  with the terms
of the arrangement in question.

(d) The Company has made all  Taxation  claims,  disclaimers  and
elections  and taken all other  action the making or doing of
which was  assumed  to have been made for the  purpose of the
Taxation provisions in the Accounts.

(2) Duties etc.

All customs duties and sales and goods and services taxes payable to any
revenue  authority upon the  importation of any of the Company's  assets
and all excise duties payable to any revenue authority in respect of any
of these  assets  have  been paid in full,  and none of these  assets is
liable to confiscation or forfeiture or subject to a Tax lien except for
liens for current Tax not yet due (whether by virtue of  non-payment  or
underpayment of any Taxation or duty or by virtue of non-compliance with
any  legislation  or  regulation  relating  to any  Taxation  or duty or
otherwise howsoever).

(3) Contracts

In  relation to the  Business,  no  contracts  to which the Company is a
party and no obligation to any present or former  director,  employee or
officer  involve any future  liabilities  of a revenue nature which when
incurred will not be  deductible  in computing  profits for Tax purposes
otherwise  than as a result  of any  future  changes  in the law or as a
result of any voluntary act after  Completion of the Purchaser or of the
Company outside the Ordinary Course of Business of the Company.

(4) Distributions and payments

In relation to the  Business,  the Company  has  deducted  and  properly
operated and  accounted to the  appropriate  revenue  authority  for all
amounts which it has been obliged to deduct in respect of Taxation.

(5) Employee benefits

(a) The Company has made all required deductions and withholdings
from all payments made, or treated as made, to its directors,
Employees  or  officers  or former  directors,  Employees  or
officers or any person  required  to be treated as such,  and
accounting  to the taxation  authorities  for all Taxation so
deducted  and for all Taxation  chargeable  on the Company on
benefits  provided for its directors,  Employees or officers,
or former directors, Employees or officers.

(b) The  Disclosure  Letter  contains  full  details of all share
incentive schemes,  profit sharing schemes and profit related
pay schemes established by the Company.

(6) Residence and offshore interests

(a) The  Company  is and has at all times  been  resident  in the
United  States of America for the  purposes  of all  Taxation
Statutes  and has not at any time been  resident  outside the
United  States of America for the  purposes  of any  Taxation
Statute or any double taxation arrangements.

(b) The  Company  has not at any time had a  branch  outside  the
United States of America or any permanent  establishment  (as
that expression is defined in the respective  double taxation
relief orders current at the date of this Agreement)  outside
the United  States of America and the Company has no existing
entitlement  to  receive  royalties,  (or any sum  treated as
royalties for any Taxation  purposes)  which are paid subject
to  deduction  of Tax in a  jurisdiction  outside  the United
States of America.

(7) Election under section 338 (h) (10) of the Code

The Seller  represents  that it has filed a consolidated  federal income
tax return for the Company for the taxable year  immediately  preceeding
the current  taxable year and the Seller is eligible to make an election
under Section 338 (h) (10) of the Code.

K. MILLENNIUM COMPLIANCE

(1) For the purposes of this agreement "MILLENNIUM COMPLIANT" means that the
Computer Systems are capable of the following  functions before,  during
and/or after 1 January 2000:

(a) handling date information involving all and any dates before,
during and/or after 1 January 2000  including  accepting date
input, providing date output and performing date calculations
in whole or part;

(b) operating  accurately without  interruption on and in respect
of any and all dates  before,  during  and/or after 1 January
2000 and without any change in performance;

(c) responding  to and  processing  two digit year input  without
creating any ambiguity as to the century; and

(d) storing and providing date input information without creating
any ambiguity as to the century.

(2) The Disclosure  Letter  contains  material  details of the measures that
have been  implemented  within the Business to  determine  the extent to
which its Computer  Systems are not Millennium  Compliant,  and material
details of any  programme  undertaken by the Business with a view to its
Computer  Systems  achieving  Millennium  Compliance  (or  so  close  to
Millennium Compliance as is practicable).

L. INTRA-GROUP ARRANGEMENTS

(1) There is no  indebtedness  or liability  (actual or contingent)  nor any
security  owed by the  Company  to any member of the  Seller's  Group or
ICI's Group (as constituted  following Completion) other than arising in
the Ordinary Course of Business and as conducted on arm's length terms.

(2) There is no agreement or contract to which the Company is a party and to
which  any  member  of the  Seller's  Group  (as  constituted  following
Completion)  is a  party  or in  which  any  such  member  is  otherwise
interested  in any  way  whatsoever  which  shall  continue  beyond  the
Completion Date.

M. DEBTORS

(1) The Company has not made,  or entered  into any contract or agreement to
make any loan to, or other  arrangement  with, any person as a result of
which it is or may be owed any money other than trade debts  incurred in
the Ordinary Course of Business and cash at bank.

(2) The Company is not entitled to the benefit of any debt otherwise than as
the original  creditor and has not  factored or  discounted  any debt or
agreed to do so.

(3) All of the  debts  which  will  be  reflected  in the  Final  Completion
Statement as owing to the Company  (apart from bad and doubtful debts to
the extent to which they have been provided for in the Final  Completion
Statement  (as defined in Schedule 6)) will realise  their full value as
included in the Final  Completion  Statement  within the  payment  terms
agreed with the respective creditors.

N. OTHER OPERATIONS AND ASSETS

(1) During the 8 years prior to the date hereof,  neither the  Company,  nor
any of its downstream Affiliates nor any entity to which the Company has
succeeded  through merger or by operation of law, has engaged,  directly
or  through  downstream  Affiliates  or agents or in  partnership,  in a
business  other  than  the  manufacture,   import,   export,   sale  and
distribution of titanium pigments, co-products and related products.

(2) The Seller has disclosed to the  Purchaser  details of all real property
owned,  leased  or  occupied  by the  Company  or any of its  downstream
Affiliates  or any entity to which the  Company  has  succeeded  through
merger or by  operation  of law at any time  during the 8 years prior to
the date hereof.

(3) The  Seller  has  disclosed  to  the  Purchaser  all  off-site  disposal
locations of Hazardous  Materials  owned by the Company,  its downstream
Affiliates  and any entity to which the  Company has  succeeded  through
merger  or by  operation  of law  during  the 8 years  prior to the date
hereof.

(4) Neither the Company, nor any of its downstream Affiliates nor any entity
to which the Company has succeeded through merger or by operation of law
has owned or  controlled  a business for whose  liabilities  any of them
could be  responsible  the business  records of which have not been made
available in the Data Room.

SCHEDULE 3.2
WARRANTIES WITH RESPECT TO THE LPC INTERESTS ONLY

(1) With  respect  to  the  LPC  Interests,  the  execution,   delivery  and
performance  by Seller of this  Agreement  and the  consummation  of the
transactions  contemplated  hereby do not and will not (i)  violate  the
certificate  of  incorporation  or bylaws of the Seller or the  Company,
(ii) violate any law, rule, regulation,  judgment,  injunction, order or
decree  applicable  to LPC or the  LPC  Interests,  (iii)  constitute  a
default under any provision of any agreement or other instrument binding
upon the Seller or the Company  relating to the LPC Interests or LPC, or
(iv)  result  in the  creation  or  imposition  of any  lien  on the LPC
Interests.

(2) The Seller or the Company has good title to the LPC Interests,  free and
clear of any lien or other adverse interest.

(3) There is no action,  suit,  investigation or proceeding pending against,
or to the  knowledge  of Seller or the  Company,  threatened  against or
affecting,  the Seller or the Company  before any court or arbitrator or
any  governmental  body,  agency  or  official,   relating  to  the  LPC
Interests,  which in any manner challenges or seeks to prevent,  enjoin,
alter  or  materially  delay  the  transactions   contemplated  by  this
agreement.

(4) Neither the Seller nor the  Company is in  violation  of any law,  rule,
regulation,  judgment, injunction, order or decree applicable to the LPC
Interests or to LPC.

(5) The US  Financial  Information  relating to the LPC  Interests  has been
derived from the books of the Company,  which books have been  regularly
and  consistently  kept and  maintained  using ICI's  normal  accounting
policies and  practices as set out or referred to in ICI's  Controller's
Manuals (and the policies  contained in these  Manuals are in accordance
with UK GAAP) as applied by the relevant  business on a consistent basis
in accordance with UK GAAP and, on such basis, represents the assets and
liabilities of the Business as at 28 February 1998.

(6) The US  Financial  Information  relating  to the  LPC  Interests  fairly
represents the matters presented  therein.  Since 28 February 1998 there
has been:

(a)    no  material  change in any  accounting  or  inventory  valuation
methods used by the Company in connection with the Assets; and

(b)    no upward revaluations of existing Stocks.

SCHEDULE 4
IMPLEMENTATION AGREEMENTS

1 Deed of Indemnity

2 Name Agreement  between Tioxide Europe Limited,  E.I. Du Pont de Nemours
and Company and the Company

3 LPC Termination Agreement between Kronos, Inc., Kronos Louisiana,  Inc.,
Kronos International, Inc., Kronos Europe S.A./N.V., Kronos Canada Inc.,
Kronos Titan GmbH, LPC, Tioxide Group Limited and Tioxide Group Services
Limited

4 LPC Licence  Agreement between Kronos,  Inc.,  Kronos  Louisiana,  Inc.,
Kronos International, Inc., Kronos Europe S.A./N.V., Kronos Canada Inc.,
Kronos Titan GmbH, LPC and Tioxide Europe Limited

SCHEDULE 5
ENVIRONMENT

1 INTERPRETATION

For the purposes of this Schedule,  words and expressions defined in the
Share Sale  Agreement to which this Schedule is attached  shall have the
same  respective  meanings  in  this  Schedule  and,  in  addition,  the
following terms shall have the following respective meanings:

"COMMERCIALLY  REASONABLE EXPENSES" are those costs and expenses which a
reasonable person acting in a commercially  prudent manner,  taking into
account  (but  without  imposing  an absolute  requirement)  the need to
minimise his expenditure, would expend, in the case of any obligation to
carry out the  remediation of  Environmental  Contamination  pursuant to
Environmental Laws, to meet that obligation. For the avoidance of doubt,
Commercially Reasonable Expenses shall not include any costs or expenses
to the extent  that they are  incurred  as a result of the  adoption  or
imposition of standards of clean-up materially more stringent than those
which are provided for under Environmental Laws;

"CONTROLLED  WATERS"  means  waters  including  any  ground  or  surface
waters;

"COUNTER  INDEMNITY" means the indemnity  defined in  sub-paragraph  3.1
of this Schedule;

"ENVIRONMENT"  means air,  Controlled  Waters,  land  (whether on, in or
below such land,  excluding any buildings or other permanent  structures
on, in or below the land) but  including  the  surface of any river bed,
the surface of any sea bed or any other land covered by water, and flora
and fauna and all other natural resources;

"ENVIRONMENTAL CONTAMINATION" means any discharge,  transport, emission,
release, leakage,  spillage, escape or disposal of Hazardous Material at
or from the Site(s) onto or into any part of the Environment;

"ENVIRONMENTAL  LAWS"  means  any and all  legislation  (whether  civil,
criminal or administrative),  statutes,  treaty,  statutory  instrument,
directive, bylaw or judgment, regulations,  ordinances, notices, orders,
government  circulars,  codes of practice,  policy and guidance notes or
decisions  of any  competent  regulatory  body or common law relating to
pollution  or  protection  of the  Environment  or harm to human  health
arising from Environmental Contamination,  which as at Completion are in
effect  and  legally  capable  of  enforcement  by legal  process in the
country in which the Site(s) are situated;

"ENVIRONMENTAL  LIABILITIES" means all claims, costs, damages,  expenses
(including reasonable professional fees incurred),  losses,  liabilities
(including  without  limitation  liability to third  parties),  fines or
penalties  suffered or incurred by the  Company,  the  Purchaser  or its
Affiliates  (or the Seller or its  Affiliates in the case of the Counter
Indemnity)  in  relation to the  Company  (excluding  in the case of the
Indemnity but not the Counter  Indemnity the LPC Interests and LPC) as a
direct   consequence  of  or  in  connection   with  any   Environmental
Proceeding;

BUT EXCLUDING any claims, costs, damages, expenses, losses, liabilities:

(i) in  respect  of capital  expenditure  on plant and  equipment
other than capital to carry out remediation of  Environmental
Contamination pursuant to Environmental Laws;

(ii)in respect of loss of anticipated  profits,  loss of revenue,
or any other loss in respect of business  interruption  other
than such reasonably  foreseeable losses of third parties who
have themselves directly suffered the relevant  Environmental
Contamination  or  whose  use of  the  Environment  has  been
adversely and directly affected by the relevant Environmental
Contamination;

(iii)  where   applicable   to  the  extent  that  they  are  not
Commercially Reasonable Expenses;

"ENVIRONMENTAL PROCEEDING" means in relation to the Company:

(i) subject  to (ii)  below,  any one or more  writs,  interim or
final   judicial  or   administrative   decrees,   judgments,
injunctions, orders, or notices:

(a)under which the Company,  the Purchaser or its  Affiliates
(or  the  Seller  or its  Affiliates  in the  case  of the
Counter  Indemnity) are obliged by  Environmental  Laws or
legal process pursuant to Environmental  Laws to undertake
or pay the cost of remediation or with which the aforesaid
parties are otherwise obliged to comply; or

(b)in  respect  of any  violation  or  alleged  violation  of
Environmental Laws; or

(c)in respect of:

(01)    any personal injury to any third party; or

(02)    damage to any property of any third party,

both pursuant to Environmental Laws;

Provided that in the case of the Indemnity only:

*  the  reference  to the Company  shall  exclude the LPC
Interests and LPC; and

*  in paragraphs  (i) (c) (01) and (02), the reference to
a  "THIRD  PARTY"  shall  not  include  any  employee,
contractor  or agent of the Company,  the Purchaser or
and its Affiliates, except when:

-  the  personal   injury  other  than   asbestos-related
personal  injury  (in the  case of  paragraph  (i) (c)
(01); and/or

-  the damage to property (in the case of (i) (c) (02),

occurs after  Completion  and, the  Purchaser  did not
know or  reasonably  ought  not to have  known  of the
circumstances which gave rise to that personal injury,
or as the case may be, that damage; and

(ii)any  agreement  between the Seller and  Purchaser  (or in the
event of disagreement any  determination by the Experts) that
it  is  Reasonably  Necessary  to  undertake  remediation  of
Environmental  Contamination,  which  would (but for the fact
that an  environmental  authority  is  unaware of it) be more
likely  than  not to  result  in an  environmental  authority
bringing  an  Environmental  Proceeding  under  (i)(a) in the
definition of Environmental Proceeding and which would result
in Environmental Liabilities;

"HAZARDOUS MATERIAL" means hazardous,  poisonous,  dangerous, noxious or
toxic substances, pollutants or wastes including (to the extent they are
hazardous,   poisonous,   dangerous,   noxious  or  toxic)   pesticides,
contaminants,  petroleum products,  asbestos,  polychlorinated biphenyls
and radiation;

"INDEMNITY" means the indemnities contained in paragraph 2 below;

"REASONABLY  NECESSARY" means reasonably  necessary to avoid or avert or
mitigate the development of substantial  adverse and material  pollution
of the  Environment  or harm to human  health  which will arise within a
period of six months; and

"SITES(S)" means the Properties.

2 INDEMNITY

2.1 Subject to the provisions of this  agreement,  the Seller  undertakes to
the Purchaser (for the benefit of the Company, the Purchaser and each of
its  Affiliates)  that it will  indemnify and hold harmless the Company,
the Purchaser and each of the Purchaser's Affiliates against:

2.1.1  all Environmental  Liabilities arising at or from the Site(s), to
the extent that such  Environmental  Liabilities  are a result of
Environmental  Contamination  occurring on or before  Completion;
and

2.1.2  save  in  respect  of the  LPC  Interests  and  LPC,  all  costs,
damages,   expenses,  losses,  fines  or  penalties  suffered  or
incurred by the Company or the  Purchaser or its  Affiliates as a
result of any  prosecutions  commenced or proceedings  taken,  or
notices served or other formal  enforcement  action between [DATE
OF SIGNATURE OF FRAMEWORK  AGREEMENT]  1998 and Completion by any
competent  regulatory  body in connection with the Environment or
health   and  safety  as  a  result  of  any   breaches   of  any
Environmental  Laws  related  to the  operation  of  those  Sites
which are  owned,  occupied  or used by the  Company  AT [DATE OF
SIGNATURE  OF  FRAMEWORK   AGREEMENT]  1998.  "DAMAGES"  in  this
paragraph  2.1.2  includes  any  capital  expenditure  reasonably
required to remedy such breaches; and

2.2 notwithstanding  sub-paragraphs  2.1 above and 4.1  below,  neither  the
Seller nor any of its Affiliates  shall be liable under the Indemnity or
otherwise  to  the  extent  that  such  liability   arises  from  or  is
attributable  to the failure of the  Purchaser  to comply or procure the
Company's compliance with the provisions of paragraphs 4.2, 6.1, 6.2, 7,
8, 9, 10, 12 and 14 of this Schedule.

3 THE COUNTER INDEMNITY

3.1 The  Purchaser  undertakes  to the Seller (for the benefit of the Seller
and each of its  Affiliates)  that,  subject to the  provisions  of this
agreement, it will indemnify and hold harmless (the "COUNTER Indemnity")
the  Seller  and  each  of  its  Affiliates  against  all  Environmental
Liabilities  arising  at or from the  Site(s)  to the  extent  that such
Environmental Liabilities are as a result of Environmental Contamination
after Completion.

3.2 Notwithstanding   sub-paragraph   3.1  above,   the  Purchaser  and  its
Affiliates shall not be liable to the Seller under the Counter Indemnity
or  otherwise  to the  extent  that  such  liability  arises  from or is
attributable  to the failure of the Seller to comply with the provisions
of  paragraphs  3.3,  4.2,  6.1,  6.2,  7, 8, 9,  10,  12 and 14 of this
Schedule.

3.3 The Seller  shall take all  reasonable  steps to avoid or  mitigate  any
Environmental  Liabilities and potential Environmental Liabilities which
may give rise to a claim under or in connection with this
Counter Indemnity, howsoever arising.

3.4 The  provisions  of  sub-paragraphs  4.2 and 12.1  shall  apply  equally
mutatis mutandis in respect of the Seller and the Purchaser's  rights or
obligations in respect of the Counter Indemnity.

4 LIMITATIONS

4.1.1  Neither  the  Seller  nor any of its  Affiliates  shall be liable
under   the   Indemnity   to  the   extent   that   Environmental
Liabilities have arisen,  been increased,  exacerbated,  enhanced
or caused as a result of any act or omission  (whether  direct or
indirect)  of the  Company,  the  Purchaser  or  any  Affiliates,
employees,   agents  or  contractors   thereof  after  Completion
(including,   without  limitation,  any  change  of  use  of  the
Site(s)  including  closure  of all or any part of the  Sites but
not  including  any  material   change  of  process   within  the
existing  plant and/or  buildings  or any  material  change to or
development  of the  business  and  operations  carried on at any
Site  which  does not  result in any Site or any part of any Site
ceasing  to be used  for  general  industrial/manufacturing  of a
type materially similar to the existing Site operation.

4.1.2  The word  "OMISSION"  as used in this  paragraph  4.1  shall  not
mean any  failure  by the  Company  or  Purchaser  to  carry  out
remediation or preventative  action in circumstances  where it is
not within  their  power to do so or where the  Purchaser  is not
aware  or  could  not   reasonably   have   been   aware  of  the
Environmental   Liabilities   in  question   or  where   (without
prejudice to the  obligations  of the Purchaser  under  paragraph
5) the  rights  of the  Purchaser  to  bring  a claim  under  the
Indemnity would be prejudiced as a result thereof.

4.2 No  claim  may be  made  for any  Environmental  Liabilities  under  the
Indemnity  or Counter  Indemnity  to the extent  that any  Environmental
Liabilities arise:

4.2.1  as a result  directly or  indirectly of  information  voluntarily
given,  in the  case of the  Indemnity  by the  Purchaser  or the
Company  (but only post  Completion  in the case of the  Company)
or, in the case of the  Counter  Indemnity,  by the Seller  after
Completion  to a  regulatory  authority  in  circumstances  other
than  where  there is a  mandatory  reporting  requirement  under
Environmental  Laws or where  information is given as required in
the   context   of    applications    for   or    variations   to
authorisations,   licences  and  other  forms  of   environmental
consent  required by the Business in the course of the  Company's
or the  Purchaser's or Seller's  normal  business  activities (as
appropriate)  or where the other  party has  previously  proposed
or approved this course of action in writing; and

4.2.2  save where compelled by law, from any admission of liability by a
representative of the Purchaser or Seller holding a rank not less
than that of Senior  Vice  President  in respect of any  clean-up
which needs to be done, except where the other party has approved
such  admission in writing such  approval not to be  unreasonably
withheld or delayed.

4.3 No claim under the terms of the  Indemnity or Counter  Indemnity for any
Environmental  Liabilities  shall be valid unless notice has been served
in  accordance  with the  provisions  of  paragraph 7 and in the case of
Indemnity,  but not the Counter  Indemnity,  said notice has been served
within 10 years of Completion.

4.4 The  Seller's   liability  under  the  Indemnity  shall  be  limited  in
accordance  with the  provisions  of the Americas  Liability  Agreement,
except for  sub-clauses  4.1.2 (save for the proviso to sub-clause  4.1)
and 4.2 of the Americas Liability Agreement, the subject matter of which
will be governed by the provisions of this Schedule.

4.5 In the event that the  Indemnitor  (as defined in paragraph  6.1) either
incurs external charges,  costs and expenses for environmental  services
or internal charges for its own environmental  services,  in either case
including but not limited to testing and/or  analytical  services and/or
contaminated soil disposal facilities, in connection with or in relation
to any actual or potential Environmental Liabilities under the Indemnity
or Counter  Indemnity (as  appropriate)  then such external and internal
charges,  costs and expenses  shall be deemed to be payments  made under
the  Indemnity  or Counter  Indemnity  (as  appropriate).  Any  internal
charges shall be made on the same basis as the Indemnitor charges to its
own business or its Affiliates.

4.6 It is hereby  expressly  agreed that, save where the Seller has accepted
liability or becomes  otherwise liable under the terms of the Indemnity,
all costs  incurred  by the  Purchaser  in  carrying  out  environmental
analyses and tests of the Site(s) (and its (or their)  surrounds)  shall
be borne by the  Purchaser,  other  than  costs in the  exercise  of the
rights and  powers  given to the  Seller by  sub-paragraphs  9.1 and 9.2
which shall be borne by the Seller unless the Purchaser  becomes  liable
therefor under the terms of the Counter  Indemnity or unless the parties
otherwise agree.

4.7 The Seller shall be liable under the Indemnity for any  asbestos-related
personal  injury  unless and to the extent that any works carried out by
the Purchaser or its  Affiliates or the Company after  Completion,  were
not carried out by a reputable contractor or contractors,  who were duly
and properly  authorised or approved to undertake such works to at least
the  standards  of the  relevant  federal,  state  or  other  regulatory
authorities  published  by or in  operation  (in  accordance  with  good
industry practice) at all times during the carrying out of such works.

5 MITIGATION

The  Seller and the  Purchaser  shall take all  reasonable  steps  after
Completion  to avoid or mitigate any  Environmental  Liabilities  and/or
potential  Environmental  Liabilities  to the  extent  it is  reasonably
within their respective  powers to do so, which may give rise to a claim
under or in  connection  with this  Indemnity or Counter  Indemnity,  as
appropriate, howsoever arising. Such steps will include but shall not be
limited to:

5.1 in  the  case  of  the   Purchaser,   carrying  out  (where   reasonably
practicable)  appropriate  soil tests before  taking any action which is
likely to cause a material disturbance to soil;

5.2 in the case of the Purchaser,  where reasonably  practicable carrying on
its  activities  on the Site(s) so as to minimise  disturbance  to known
areas of existing or probable soil contamination  (other than deliberate
removal of such contaminated soil) without incurring abnormal unusual or
excessive cost in so doing;

5.3 where  relevant,  (with  the  approval  of  the  other  party  not to be
unreasonably  withheld  or  delayed)  settling a claim of any party (not
being an Affiliate of the  Purchaser in the case of the  Indemnity or of
the Seller in the case of the Counter  Indemnity) which will or may fall
within the terms of the Indemnity or Counter Indemnity,  as appropriate,
the costs and expenses  associated  with such settlement (so approved by
the other party) being deemed to be  Environmental  Liabilities  for the
purposes  of  this  agreement,  provided  always  that  nothing  in this
sub-paragraph 5.3 shall oblige the Purchaser or the Seller to enter into
any settlement which it does not, in its sole discretion, consider to be
in the best interests of its operations;

5.4 making  reasonable and timely efforts to pursue claims against any third
parties  (including  insurers) who may have some liability in respect of
the matter in  question  under the  Indemnity  or Counter  Indemnity  as
appropriate  provided  always  that this shall not limit or  restrict or
operate  in any way as a  pre-condition  to the  rights  to make a claim
under this Indemnity or Counter Indemnity, as appropriate; and

5.5 in the case of the Purchaser,  using reasonable endeavours to avoid acts
or  omissions  of the  nature  described  in  sub-paragraph  4.1 of this
Schedule.

6 Notification

6.1 As soon as  reasonably  practicable  after either party becomes aware of
any actual or potential Environmental Liabilities which may give rise to
a claim by it under the Indemnity or Counter  Indemnity (the "CLAIMANT")
(whether or not the Claimant is of the opinion that it has a valid claim
against the other party under the  Indemnity or Counter  Indemnity  (the
"INDEMNITOR")),  the Claimant  shall give written  notice thereof to the
Indemnitor (and  thereafter will use all reasonable  efforts to keep the
Indemnitor  reasonably  informed of all material  developments  relating
thereto).  Such written notice shall include  reasonable  details of all
relevant  matters  relating  to any  actual or  potential  Environmental
Liabilities.   Thereafter,   the  Claimant  will  promptly   advise  the
Indemnitor orally of the Claimant's reasonable estimate of the extent of
and,  where  reasonably  practicable,  the  cost of  remediation  of the
Environmental  Liabilities,  as a  result  thereof),  provided  that the
Indemnitor  shall have given the Claimant  written notice of the name of
its representative to whom such oral communication shall be imparted.

6.2 Neither  party shall admit,  settle or discharge  any claim or liability
which might  constitute a claim against the other under the Indemnity or
Counter Indemnity (as appropriate)  without having first served a notice
under this  paragraph 6 and given the other a reasonable  opportunity to
consider the circumstances referred to in the said notice.

7 CLAIMS

In the  event  that the  Claimant  wishes  to make a claim  against  the
Indemnitor  under the Indemnity or Counter  Indemnity  (as  appropriate)
then it shall  do so by  giving  notice  in  writing  of the same to the
Indemnitor  giving  such  details as are then in its  possession  of the
relevant subject matter of such claim.

8 CONDUCT

If any notice is received by either  party under  paragraphs 6 or 7, the
Claimant shall, if so requested by the Indemnitor,  take all steps which
are necessary and  reasonable to avoid,  resist,  appeal,  compromise or
defend any claim and any adjudication in respect thereof (subject to the
Claimant  being  indemnified  against  all cost and  expenses  which may
reasonably and necessarily be incurred in connection therewith), and the
Indemnitor shall (subject to the provisions of this  paragraph),  at its
request, be allowed to conduct any negotiations,  proceedings or appeals
incidental  thereto  PROVIDED  ALWAYS  that if the claim  relates  to or
arises  from a Site which at the time is owned,  occupied or used by the
Company  and  which  is  operational  at the  date of the  notice  under
paragraph 7 then the Purchaser  shall have conduct of all  negotiations,
proceedings or appeals incidental thereto but shall nonetheless keep the
Seller  fully  informed  of all  material  developments  relating to the
subject matter of the claims.

9 SITE ACCESS

If any notice is received by the Seller under paragraphs 6 or 7:

9.1 the  Seller  and/or its  agents  and  contractors  shall be free to have
access  to any  Site(s)  to the  extent  it is  within  the power of the
Company, the Purchaser or its Affiliates,  during normal business hours,
and after reasonable prior notice, and, if so required by the Purchaser,
in the presence of authorised representatives of the Purchaser to assess
(including  but not limited to  assessment by soil sampling and testing)
the   extent  of  the   Environmental   Liabilities   and/or   potential
Environmental  Liabilities and to determine the action required in order
to remediate such  liabilities  (such actions to be subject to the prior
agreement of the Purchaser (including as to the action to be taken) such
agreement not to be unreasonably withheld); and

9.2 the Purchaser  shall (during normal  business hours) allow the Seller or
its agents  access to inspect  and take copies of such books and records
of the  business of the  Company  and/or the  Purchaser  relating to the
Site(s)  as  may be  necessary  in  connection  with  any  Environmental
Liabilities and/or potential Environmental Liabilities.

9.3 The Seller shall exercise  proper care in the exercise of its powers and
rights  pursuant to this  paragraph 9 and shall  indemnify the Purchaser
for all  reasonably  incurred  losses or  liabilities  arising  from the
Seller's failure to do so.

10 DISCUSSIONS

Upon either party having given a notice under  paragraphs 6 or 7, either
the Seller or the Purchaser may request a meeting as soon as practicable
to  discuss  the matter  (and if either  does so the other  party  shall
comply  promptly with such request) and,  irrespective  of whether there
has been any agreement on liability,  each party shall be fully involved
but (save as  otherwise  agreed  between the parties) not as to make any
admission or liability  not  permitted by the other  provisions  of this
Schedule in any discussions and/or  negotiations with any party imposing
or seeking to impose any Environmental Liabilities.

11 DISPUTE RESOLUTION

Upon either party giving a notice in accordance with paragraph 7, in the
event  that the Seller and the  Purchaser  are unable to agree  promptly
upon any factual  matter  relevant to a claim  under this  Indemnity  or
Counter  Indemnity (as  appropriate) or in the event of any other matter
being referred to the Experts in accordance  with this Schedule then the
following provisions of this paragraph 11 shall apply:

11.1 a reputable  independent  firm of experts (the "EXPERTS") (who shall act
as experts and not arbitrators) in relation to the Environment  relevant
to the claim or  potential  claim  (having  at least ten years  relevant
experience) shall be appointed by mutual agreement of the parties hereto
(and the  parties  shall each be obliged  to use their  respective  best
endeavours  to reach  agreement as soon as  practicable)  to resolve any
factual  matter in dispute  between the parties  but not  including  any
interpretation  of laws or  regulations  as they  apply to such  factual
matters or any conclusions regarding  responsibility or liability for or
in  relation to any factual  matters.  The Experts  shall be offered the
appointment  within 15 Business Days of the parties reaching such mutual
agreement  and  shall  be  notified  in  writing  of the  provisions  of
sub-paragraph   11.7  below.   Failing  such  mutual  agreement  on  the
appointment of Experts,  the parties shall promptly refer the issue,  at
their  joint  cost,  to the  President  for the time  being of the Royal
Institute of Chartered Surveyors in the United Kingdom with instructions
to  appoint   suitable  Experts  within  14  days  of  receipt  of  such
instructions;

11.2 the said Experts shall only be dismissed by the mutual  agreement of the
parties hereto;

11.3 both parties shall promptly and simultaneously  exchange with each other
and  submit  to the  Experts,  and in any event in  accordance  with the
Experts'  written   directions,   their  arguments  and  submissions  in
connection  with any matter of fact referred to them in accordance  with
this paragraph 11;

11.4 following  receipt by the  Experts of the  written  arguments  and other
submissions of the parties pursuant to paragraph 11.3, the parties shall
instruct  the Experts to issue,  as soon as  reasonably  practicable,  a
formal  written  opinion  pertaining  to the matter of fact  referred to
them. In any event,  the Experts shall be instructed to present the said
opinion  within two months after  receiving  the written  arguments  and
other submissions of the parties pursuant to sub-paragraph 11.3;

11.5 the  formal  written   opinion  of  the  Experts   issued   pursuant  to
sub-paragraph  11.4 shall be conclusive in any  proceedings  between the
parties hereto as to the question of fact so determined;

11.6 the fees and  expenses  of the  Experts  shall be borne  equally  by the
Seller and the Purchaser (unless otherwise directed by the Experts); and

11.7 the Experts,  and any company,  firm,  partnership or other organisation
with  which the  Experts  are  connected,  shall not be  eligible  to be
considered  to undertake  any clean-up  work in respect of the claim for
which they have so acted on or around the Site(s) save where the parties
hereto  mutually  agree to waive this  provision.  For the  avoidance of
doubt, either party may withhold such consent in any event.

12 ACCEPTANCE OF LIABILITY

In the event that the Seller  admits  that it has any  liability  to the
Purchaser  under the Indemnity (or where the Seller agrees to accept the
Purchaser's  claim as falling within the Indemnity  notwithstanding  the
fact  that no  Environmental  Liability  may at that  point in time have
arisen):

12.1 Subject to consulting with and paying  reasonable regard to the views of
the  Purchaser,  the  Seller  shall  have  the  right  independently  to
determine  whatever  measures  are  appropriate  in order  to  remediate
pursuant to  applicable  Environmental  Laws the  subject  matter of the
claim under the  Indemnity  and  furthermore  the Seller  shall have the
right  independently  to carry out such  remediation  itself (or through
suitable  third party agents or  contractors)  provided that in so doing
the Seller (or its said agents or  contractors)  shall be obliged to use
reasonable endeavours to avoid causing undue interruption to the conduct
of the business of the Company and/or its Affiliates;

12.2 The Seller and/or its agents and  contractors  shall, in addition to the
rights of access  provided  for in  paragraph  9 above,  be free to have
access to the Site(s) if  currently  owned,  leased or, where within the
power of the Company and its  Affiliates,  during normal  business hours
after  reasonable prior notice,  and if so required,  in the presence of
authorised   representatives   of  the  Purchaser,   to  carry  out  the
remediation  referred to in  sub-paragraph  12.1 above provided that the
Seller (or its agents or contractors) shall be obliged to use reasonable
endeavours  to avoid causing  undue  interruption  to the conduct of the
business of the Company and/or its Affiliates.

12.3 The Seller shall exercise  reasonable care in the exercise of its powers
and rights  pursuant to this paragraph 12 and shall exercise  reasonable
skill,  care and  diligence  in carrying out any works and shall not use
any materials  which are not in accordance with the  recommendations  of
relevant  authorities  and codes of practice.  The Seller shall  procure
that the contractors and consultants  engaged to carry out and advise on
the works  are  bound by  obligations  in the same  terms of  reasonable
skill,  care and  diligence as herein  before  mentioned  and  otherwise
engaged  on  market  terms  at  the  time  and  shall  procure  suitable
warranties  in accordance  with normal market  practice at the time from
the contractors  and consultants om favour of the Purchaser.  The Seller
shall not carry out the works  itself but shall always  engage  external
contractors and consultants  approved by the Purchaser such approval not
to be unreasonably withheld or delayed.

13 STATEMENTS

In the event of any  circumstances  arising which do or may give rise to
Environmental  Liabilities  which  may  fall  within  the  terms  of the
Indemnity or the Counter Indemnity (as appropriate) neither the Company,
the Purchaser nor the Seller (nor any of their respective Affiliates) to
the extent  practicable  shall make any public  statements  which is not
required  by law or  the  rules  of any  regulatory  authority  to  make
regarding such  circumstances  without first  discussing  with the other
party  and  reaching  written   agreement  (such  agreement  not  to  be
unreasonably  withheld  or  delayed)  on the  text  of any  such  public
statement before it is made.

14 GENERAL

14.1 Any  information,  records,  or other  material  of one  party  shall be
treated as strictly  confidential  by the other party except when (a) it
is  required to be used in order to comply with an order of the court or
regulatory authority or (b) it is used by the other party to enforce its
rights under this Schedule or so as to make an insurance  claim provided
that, in the case of either (a) or (b), disclosure is made in accordance
with this sub-paragraph  14.1. If either party becomes legally compelled
(including  by   deposition,   interrogatory,   request  for  documents,
subpoena, civil investigative demand or similar process) to disclose any
of the  information,  records,  or other  material  referred  to in this
sub-paragraph  14.1, the party so compelled shall provide the other with
prompt prior written  notice of such  requirement  so that the other may
seek a  protective  order or other  appropriate  remedy.  To the  extent
lawfully  able to do so, each party  agrees to cooperate in each other's
efforts to obtain a protective order or other reasonable  assurance that
confidential  treatment shall be accorded any such information.  If such
protective order or other remedy is not obtained, the party so compelled
agrees to disclose  only that portion of the  information,  records,  or
other  material  which it is advised  by  opinion of outside  counsel is
legally  required to be disclosed  and to take all  reasonable  steps to
preserve  the  confidentiality  of the  information,  records,  or other
material referred to in this sub-paragraph 14.1. Any other disclosure by
one party of information,  records or materials of the other party shall
require the prior written  consent of such other party,  which shall not
be unreasonably withheld or delayed.

14.2 The Purchaser's and its Affiliates' and the Seller's and its Affiliates'
exclusive  remedies in respect of any claims which fall within the scope
of the  Indemnity  or Counter  Indemnity,  as  appropriate,  shall be in
accordance  with the provisions of this  Schedule,  and the Purchaser on
behalf of itself and its Affiliates and the Seller,  on behalf of itself
and  its  Affiliates,  hereby  waives  all  other  remedies  whether  in
contract,  tort (including,  for the avoidance of doubt,  negligence) or
howsoever  otherwise arising which it may have against the Seller or any
of  its  Affiliates  or the  Purchaser  or  any  of  its  Affiliates  as
appropriate  at law or in equity in  respect of the  matters  which fall
within the scope of the  Indemnity or Counter  Indemnities  and, for the
avoidance of doubt,  if such a claim under this Schedule could also give
rise to a Warranty  Claim or a claim under any other  provision  of this
agreement in respect of the same subject  matter,  the  Purchaser or the
Seller as appropriate may only bring a claim under this Schedule.

14.3 The Seller  undertakes to  co-operate  with the Purchaser and assist the
Purchaser in achieving a transfer to the Purchaser (or as it directs) of
all  Environmental  Authorisations,  Permits  and  licences  held by the
Seller at Completion.

15 CO-OPERATION

The Purchaser  undertakes that wherever  co-operation is required by the
Company to ensure compliance with the Purchaser's obligations hereunder,
the  Purchaser  will use its  reasonable  endeavours  to ensure that the
Company provides the requisite co-operation.

SCHEDULE 6
CONSIDERATION ADJUSTMENT TEXT

(Clause 3.3)

1 Consideration and Adjustment

SECTION 1

(1) In this Schedule 3:

"A FORM" means,  in relation to the  Company,  the  quarterly  financial
reports  in the  format  set  forth in  Annex 3 which  are  prepared  in
accordance   with  the   accounting   policies,   practices   and  other
requirements  set out or  referred to in ICI's  Controller's  Manuals as
applied by the Company (with the exception of pensions liabilities which
are  accounted  for in  accordance  with  FAS  87) and  prepared  at the
Completion  Date on a basis  consistent with that adopted by the Company
in the A Form at 31  December  1997 (with the  exception  that  pensions
liabilities shall be reported in Provisions); and if the Completion Date
does  not  fall on the due  date  for the  preparation  of an A Form,  a
financial  report  prepared on the same basis for the  financial  period
from the latest date at which an A Form was  prepared to the  Completion
Date;

"ACTUAL NET DEBT" means Net Debt as agreed or  determined  in accordance
with paragraphs (4) to (6) below;

"ACTUAL  NET  WORKING  CAPITAL"  means  Net  Working  Capital  as at the
Completion Date as determined under paragraphs (4) to (6) below;

"ESTIMATED CONSIDERATION" has the meaning given in sub-Clause 3.1;

"ENTERPRISE VALUE" means US$23,635,000;

"FINAL CONSIDERATION" has the meaning given in paragraph (3)(a) below;

"FINAL  COMPLETION  STATEMENT" has the meaning given in paragraph (3)(b)
below;

"FINAL STOCKS" means the value of Stocks for the Company at Completion;

"ICI'S  CONTROLLER'S  MANUALS" means the control manuals in existence at
14 July 1997 and which are compiled in accordance  with UK GAAP used for
accounting purposes within the Seller's Group, copies of which have been
received by the  Purchaser or an Affiliate of the  Purchaser  (and which
consists of an introduction to the Group Controller's  Manual,  Bulletin
Board  Accounting   Language,   Bulletin  Board  Reporting,   Accounting
Definitions  and  Conventions,   Accounting   Policies  and  Procedures,
Controls, Reporting);

"INITIAL  STOCKS"  means the value of Stocks  for the  Company  as at 28
February 1998;

"INTEREST RATE" means LIBOR plus 25 basis points;

"NET DEBT" means the amount  reported as "NET DEBT" on line 70090 of the
A Form for the Company as described in ICI's Controller's Manuals which,
for the avoidance of doubt,  can be either a negative or a  non-negative
number;

"NET WORKING CAPITAL" means the aggregate of:

(a)    Operating Debtors; plus

(b)    Stocks  (for the  purposes  of this  definition  meaning  Initial
Stocks when used for Net Working  Capital as at 28 February  1998
and  meaning  Final  Stocks  when  used for  Actual  Net  Working
Capital); less

(b)    Operating Creditors less than 1 year;

For the  purposes of (b) the Stocks shall be valued in  accordance  with
the document headed "STOCKTAKING AND VALUATION PRINCIPLES" in the Agreed
Form marked "NWC-S";

"NET WORKING CAPITAL AS AT 28 FEBRUARY 1998" or "NWC28" means, the value
shown in the column  headed NWC 28 in Section 2 of this Schedule 3 which
is the amount which the parties  have agreed to  represent  the value of
Net Working Capital at 28 February 1998 of the Company;

"OPERATING  CREDITORS  LESS THAN 1 YEAR" means the absolute value of the
amount  reported as creditors  of the Company  which are external to the
Company (including without limitation creditors which are members of, or
other  business  units  within,  the  ICI  Group  as at the  date of the
relevant A Form) as defined by reference to  "OPERATING  CREDITORS  LESS
THAN 1 YEAR" on line 70020 of the A Form for the Company as described in
ICI's Controller's Manuals;

"OPERATING  DEBTORS"  means debtors of the Company which are external to
the Company  (including without limitation debtors which are members of,
or other  business  units  within,  the ICI  Group as at the date of the
relevant A Form) as defined by reference to "OPERATING  DEBTORS" on line
70010 of the A Form for the Company as described  in ICI's  Controller's
Manuals;

"STOCKS"  means  the  stock  of  fuels,   raw  materials,   ingredients,
packaging,  office and laboratory supplies,  revenue engineering spares,
consumable  stores,  work in progress  and  finished  goods owned by the
Company as  determined  on line  70000 of the A Form for the  Company or
Business as described in ICI's Controller's Manuals;

(2)

(a)    All  payments  and  values  under  this  Schedule  shall be in US
Dollars  and  where an  amount  is not  itself  calculated  in US
Dollars it shall be  converted  into US Dollars at the mid market
closing  exchange  rate in London for the  currency in which that
amount is  expressed  in US  Dollars as  published  in the London
Edition of the Financial  Times first  published  thereafter  or,
where the exchange  rate is not  published in the London  Edition
of the Financial  Times,  at the exchange rate quoted by Citibank
N.A. as at the close of  business  in London for the  currency in
which  that  amount  is  expressed  on  the  Completion  Date  in
relation to amounts in the Final Completion Statement.

(b)    References to the absolute value of a number X shall be construed
as follows:

(i) if X is greater than or equal to zero,  the absolute value of
X shall be equal to X; and

(ii)if X is less than zero,  the  absolute  value of X shall be X
multiplied by -1,

so that, for the purposes of illustration,  the absolute value of
1 is equal to 1 and the absolute value of -1 is equal to 1.

CALCULATION OF THE FINAL CONSIDERATION

(3) In relation to this agreement:

(a)    the Final  Consideration  for the Company  shall be determined by
the following formula:

Final  Consideration  = EV  minus  AND  minus  NWC 28  plus  ANWC
(excluding in relation to any of the foregoing any item or matter
attributable to the LPC  Interests)_plus  in the case only of TAI
LV

Where (in relation to the Company):

EV = Enterprise Value

AND = Actual Net Debt

NWC28 = Net Working Capital as at 28 February 1998

ANWC = Actual Net Working Capital

LV = US$176,222,000 (value of LPC Interests)

(b)    After  the   Completion   Date,   the  Seller  shall   prepare  a
completion  statement  as at  the  Completion  Date  which  shall
contain a  statement  of the Final  Consideration  in  accordance
with  paragraph  3(a) above  based on the  Seller's  calculations
(the  "FINAL   COMPLETION   STATEMENT").   The  Final  Completion
Statement   shall  be   prepared   using  the   Seller's   normal
accounting  policies  and  practices as set out or referred to in
ICI's  Controller's  Manuals  as  applied  by  the  Company  on a
consistent  basis and  shall be  submitted  by the  Seller to the
Seller's  Auditors  for review.  Taxation  paid or payable by the
Company  (including  any sum paid or  payable  to a member of the
Seller's  Group  in  respect  of  Taxation)  as a  result  of the
transfer  of  the  Sale  Shares  to  the   Purchaser   (including
Taxation  paid or  payable by the  Seller  under  Clause 5 of the
Tax Deed of  Covenant)  shall not be taken  into  account  in the
calculation of the Final Consideration.

(4) Within 45 days of the Completion  Date, the Seller shall issue the Final
Completion  Statement  (distinguishing  between the LPC Business and the
other business of the Company) for the Company to the Purchaser together
with a copy of a report by the Seller's Auditors addressed to the Seller
and  substantially in the form set out in Annex 3 to the effect that the
Final  Completion  Statement has been  prepared in accordance  with this
agreement.  Although it is the  Seller's  responsibility  to prepare the
Final  Completion  Statement,  the Seller will require the assistance of
the  employees  of the  relevant  Purchaser  Affiliates  to fulfil  this
responsibility  and  the  Purchaser  shall  ensure  such  assistance  is
provided  promptly and at no charge.  Immediately  after delivery of the
Final  Completion  Statement,  the  Purchaser's  Auditors shall have the
right,  subject to the Purchaser  delivering to the Sellers'  Auditors a
signed  letter  in the  form set out in Annex  5, to  review  the  Final
Completion  Statement and the Seller's  Auditors working papers relating
to the Final  Completion  Statement.  Within 45 days of  delivery to the
Purchaser of the Final  Completion  Statement and the Seller's  Auditors
report (each of which shall be in English) to the Purchaser's designated
location,  the  Purchaser  shall give notice to the Seller in writing of
any item or items in the Final  Completion  Statement which they wish to
dispute and the basis on which they dispute that item or those items and
the  changes  to the Final  Completion  Statement  which  the  Purchaser
believes  should be made and the  parties  shall  use  their  reasonable
endeavors  to resolve  that  dispute.  Any items in respect of which the
Purchaser does not give such notice will be deemed to have been accepted
by the Purchaser.  Any written  resolution reached by the parties on any
disputed item shall be final, conclusive and binding on the parties.

(5) If the parties agree the Final  Completion  Statement then any adjusting
payments  referred to in paragraph (7) below shall be made by the paying
party within 7 days of being agreed by the parties.

(6) If the  parties  fail to agree on any  element  of the Final  Completion
Statement within 14 days after the Purchaser has given notice in writing
to the Seller of any item(s) in the Final Completion Statement which the
Purchaser  wishes to dispute (in  accordance  with  paragraph (4) above)
then any agreed  amounts shall be paid in accordance  with the preceding
paragraph  and any dispute  may be  referred  by either  party for final
determination  in accordance  with sub-Clause 11.1 of this agreement and
any  amounts  thereby  found  to be due  shall  be paid by the  relevant
Affiliate not later than 7 days after such final determination.

(7) When the  Final  Consideration  is  agreed or  otherwise  determined  in
accordance with the three preceding  paragraphs the following  adjusting
payments shall be made:

(a)    an  amount  equal to the  difference  between  (i) the  Estimated
Consideration and (ii) the Final Consideration; and

(b)    interest  (compounded monthly) at the Interest Rate on the amount
in paragraph  (a) above from the  Completion  Date to the date of
payment, calculated on a day to day basis;

which shall be paid by the Seller  Affiliate to the  Purchaser  (or vice
versa, as appropriate).

(8) In this Schedule, references to lines of A Forms have been chosen by the
Seller and are  believed in good faith to  correspond  to the matters to
which they refer.  If,  however,  that  reference  when  compared to the
matter it  describes  or  refers to is  incorrect  then  there  shall be
substituted  for that line  reference to another line reference (if any)
which corresponds to the matter described or referred to.

SECTION 2

UPLIFT OF STOCKS
TO FAIR MARKET
VALUE FOR THE
NWC28                    PURPOSE OF
US$                 ALLOCATION OF
CONSIDERATION TO
CLASSES OF ASSETS
US$

Americas Business               6,857,000                           Nil

LPC Business                   15,081,000                     1,697,000

SCHEDULE 7

(Clause 1.1)

PRINCIPLES FOR DISTINGUISHING
LPC BUSINESS AND AMERICAS BUSINESS
TAI A FORM

- ------------------------------------------------------------------------
LPC BUSINESS    AMERICAS       COMMENTS
(SULPHATE)
BUSINESS
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
FIXED ASSETS                         All            - Office equipment
etc.
- ------------------------------------------------------------------------
INVESTMENTS          All                            - Partnership share
- ------------------------------------------------------------------------
STOCKS               Stocks          All other      - Based on actual
manufactured    stocks         quantities of
by LPC                         stocks from each
source
- ------------------------------------------------------------------------
OPERATING DEBTORS    Sales of        All other      - Based on
Trade Debtors}       material        trade debtors  detailed analysis
Intra Group Debtors} manufactured                   of all open
by LPC                         accounts concerned
- ------------------------------------------------------------------------
Other operating      Items           All other
debtors              exclusive to    operating
LPC             debtors
partnership or
trade in
product
manufactured
by LPC
- ------------------------------------------------------------------------
OPERATING CREDITORS
LESS THAN 1 YEAR
Trade Creditors}     Purchases of    All other      - Based on
Intra Group          material        operating      detailed analysis
Creditors}           manufactured    creditors      of all open
by LPC          less than 1    accounts concerned
year
- ------------------------------------------------------------------------
Other operating      Purchases and   All other      - Based on
creditors            services        operating      detailed analysis
exclusively     creditors      of all open
related to LPC                 accounts concerned
partnership
and to
material
manufactured
by LPC
- ------------------------------------------------------------------------
NON OPERATING        Items           All other      -Mainly tax split
DEBTORS/CREDITORS    exclusively     non-operating  based on analysis
related to LPC  debtors/       of results based
and materials   creditors      on detailed
manufactured                   analysis of all
by LPC                         open accounts
concerned
- ------------------------------------------------------------------------
NET DEBT             All Net Debt
to LPC Business
- ------------------------------------------------------------------------
PROVISIONS           Items           All other
specifically    provisions
related to LPC
- ------------------------------------------------------------------------
DEFERRED INCOME      Items           All other
specifically    deferred
related to LPC  income
- ------------------------------------------------------------------------
NET ASSETS                                          - Calculated by
difference
- ------------------------------------------------------------------------

NOTES:

1 Pension Liability (Approx.  US$250,000) is accounted for according to US
rules  (FAS87  etc.)  in A Form.  Therefore  no  reconciling  difference
between US and UK GAAP.

2 ICI A Forms  do not  report  deferred  tax for  ICI's  US  subsidiaries.
However any deferred tax in the US GAAP  accounts is readily  analysable
into its LPC and  Sulphate  and is  estimated to derive to the extent of
some 99 per cent. from LPC's tax depreciation.

SCHEDULE 8
US FINANCIAL INFORMATION

(Clause 1.1)

SPLIT A FORMS AS AT 28 FEBRUARY 1998
TAI BALANCE SHEET
AT 28 FEBRUARY

USD THOUSANDS
AMERICAS            LPC               TOTAL
BUSINESS       BUSINESS

Fixed Assets                   50              -                  50

Investments                     -        155,744             155,744

Stocks                      8,891          9,851              18,742

Operating Debtors          17,736         12,447              30,183

TCI Debtor                      -          1,405               1,405

Operating                 (18,002)        (8,622)            (26,624)
Creditors less
than 1 year

TCI Creditor               (1,768)             -              (1,768)

Non Operating                   -            288                 288
Debtors

Non Operating                   -           (728)               (728)
Creditors less
than 1 year               -------       --------            --------

6,907        170,385             177,292
-------       --------            --------

Net Debt                        -         39,943              39,943

Provisions                    268              -                 268

Deferred Income                 -              -                   -
--------       --------            --------
268         39,943              40,211

Shareholders' Equity                                         137,081
--------
177,292
--------
NOTES:

1 Operating  Debtors  at 28 Feb 1998 have been  split pro rata to sales in
January and February 1998.

2 The  pensions  provision  has been  reclassified  into  "PROVISIONS"  in
accordance with the definition of A Form in this agreement.

3 TCI Debtors/TCI Creditors and TAI Debtors/TAI Creditors net out.

SCHEDULE 9

(Clause 1.7)

David Allen
David Busby
John Collingwood
Guy Gauthier
John Gush
Rene Lachance
Michael Maughan
Dave Williams

SCHEDULE 10

(Clause 7.1(f)(iii))

SIGNATURES

SIGNED by                      }
for and on behalf of
ICI AMERICAN HOLDINGS INC.

SIGNED by                      }
or and on behalf of
NL INDUSTRIES, INC.

ANNEX 1
AGREED FORM DEED OF INDEMNITY

EXHIBIT 10.7

DATED                                 1998

TIOXIDE GROUP LIMITED

and

ICI OMICRON BV

and

NL INDUSTRIES, INC.

SHARE SALE AND PURCHASE AGREEMENT

OF

TIOXIDE CANADA INC.

LINKLATERS & PAINES
One Silk Street
London EC2Y 8HQ

TEL: (+44) 171 456 2000

Ref: AXT/TDAP

THIS AGREEMENT (this "AGREEMENT") is made on              1998  BETWEEN:

(1) TIOXIDE  GROUP  LIMITED   (registered   number  249759),  a  company
incorporated  under the laws of England,  whose registered office is
at 137/143 Hammersmith Road, London W14 0QL, England ("TG");

(2) ICI OMICRON BV  (registered  number  171649) a company  incorporated
under  the laws of The  Netherlands  whose  registered  office is at
Merseyweg 10, 3197 KB Rotterdam-Botlek,  Haven 5210, the Netherlands
and  whose   statutory   domicile  is  Rotterdam,   the  Netherlands
("Omicron" and collectively with TG, the "SELLER"); and

(3) NL INDUSTRIES,  INC., a corporation  incorporated  under the laws of
the State of New  Jersey,  whose  principal  place of business is at
16825 Northchase Drive, Suite 1200,  Houston 77060,  Texas, USA (the
"PURCHASER").

WHEREAS:

(A) Tioxide  Canada Inc. is a company  incorporated  in Quebec,  Canada,
short   particulars  of  which  are  set  out  in  Schedule  1  (the
"Company").

(B) The  Seller  holds all of the  issued  shares in the  capital of the
Company (the "SALE  SHARES")  particulars  of which are contained in
Schedule 1.

(C) The  Seller  has  agreed  to sell and the  Purchaser  has  agreed to
purchase the Sale Shares on the terms and subject to the  conditions
set out in this agreement and the Framework Agreement.

IT IS AGREED as follows:

1 INTERPRETATION

1.1 In this agreement:

"ACCOUNTING  DATE" means the date of the audited accounts of the Company
for the year ended 31 December 1997 (the "ACCOUNTS");

"ADVERSE CONSEQUENCES" means all actions, suits, proceedings,  hearings,
investigations,   charges,  claims,  demands,  injunctions,   judgments,
orders,  decrees,  rulings,  damages,  dues,  penalties,  fines,  costs,
amounts paid in settlement, liabilities,  obligations, liens (other than
those  arising by operation of law or by statute)  losses,  expenses and
fees, including court costs and reasonable attorneys' fees and expenses;

"ACCOUNTING STANDARDS" means generally accepted accounting principles as
in effect from time to time in Canada and applied as a basis  consistent
with those of previous years;

"AFFILIATES"  means with respect to a specified  entity,  an entity that
directly or indirectly through one or more intermediaries,  Controls, or
is Controlled by, or is under common Control, with the entity specified,
provided that,  without  limiting the  generality of the  foregoing,  in
relation  to ICI and its  subsidiary  companies,  the term  "AFFILIATES"
shall not  include any entity in which a party has a 50 per cent or less
ownership interest. For the purposes hereof, "CONTROL" means possession,
directly or indirectly, of the power to direct or cause the direction of
the management and operating  policies of the entity in respect of which
the  determination  is being  made,  through  the  ownership  of  voting
securities, contract, voting trust or otherwise but any

reference  in  this  agreement  to an  Affiliate  of the  Seller  or the
Purchaser  shall  exclude the Company,  and  references  to the Seller's
Group or the Purchaser's Group shall be construed accordingly;

"AGREED  FORM"  means,  in  relation to any  document,  the form of that
document which has been initialled for the purpose of  identification by
or on behalf of the parties to this agreement;

"AMERICAS  LIABILITY  AGREEMENT" means the liability  agreement  between
ICI and the Purchaser dated [           ];

"ASSETS"  means all of the assets and rights of the Company  relating to
the Business;

"BUSINESS" means:

(a) the  import,  export,  sale and  distribution  of  titanium  dioxide
pigments and co-products and related products; and

(b) the  manufacture  of finished  products  from the processes by which
reactor  discharge from the chloride process and calciner  discharge
from the sulphate  process are treated to produce  titanium  dioxide
pigments

and all other business and operations as carried on by the Company as at
the date hereof but for the avoidance of doubt shall not include:

(i) the  manufacture,  sale or  disposal  by way of  trade of any
organometallic  compounds  save  the  manufacture,   sale  or
disposal  of a pigment  which  incorporates  as an  essential
feature of its composition an  organometallic  compound shall
not be considered to be the manufacture,  sale or disposal of
an organometallic compound as such; and

(ii)the  manufacture,  sale or  disposal  by way of  trade of any
form of  titanium  dioxide of  ultraviolet-attenuating  grade
having a ratio of  absorbance  response  at 308 nm  (A308) to
absorbance  response  at 524 nm  (A524) of not less than 5 as
defined   in  US   Pharmacopeia,   amendment   published   in
Pharmacopeia  Forum,  Volume  22,  Number  4,  Page  2636 and
attached hereto as Annex 2; and

(iii) any matter relating to the LPC Business.

"BUSINESS  DATA" means the Company's  historical  and current  documents
relating to the Business, including customer lists, product, distributor
and supplier lists, catalogues,  literature, employee records, documents
of title to the Assets (but excluding those relating to the Properties),
sales targets,  sales  statistics,  market share  statistics,  marketing
surveys and reports,  marketing  research and any  advertising  or other
promotional  materials,  production  data,  safety  data and  accounting
(including  management  account records) and other financial data (other
than the  Canadian  Financial  Information),  whether in hard copy or in
computer held form (including, for the avoidance of doubt, such media as
microfilm and microfiche);

"BUSINESS  DAY" means a day (other  than a Saturday  or Sunday) on which
banks are generally open for normal business in each of London, Montreal
and New York;

"CANADIAN  FINANCIAL   INFORMATION"  means  the  financial   information
attached as Schedule 7;

"CANADIAN  SCHEMES" means the Company's  pension plans  described in the
Disclosure Letter;

"CANADIAN  TECHNOLOGY  AGREEMENTS"  means the  agreements and licence in
the Agreed Form;

"COMPLETION"  means  completion  of the  sale and  purchase  of the Sale
Shares  in  accordance  with  Clause  7 which  shall  occur  immediately
following signature and exchange of this agreement;

"COMPLETION  DATE" means  [                       ]  on the date of this
agreement;

"COMPUTER    SYSTEMS"   means   all   computer    hardware,    software,
microprocessors  and  firmware  which  in  each  case  are  used  in the
Business;

"CONTRACTS"  means  all  contracts  and  arrangements  relating  to  the
Business  entered into before  Completion by or on behalf of the Company
in connection with the Business which remain (in whole or in part) to be
performed  at  Completion  and,  in  addition,  means any  contracts  or
arrangements  between  the  Company  and  the  Seller  (or  any  of  its
Affiliates);

"DEFAULT   INTEREST"  means  LIBOR  plus  200  basis  points  compounded
monthly;

"DISCLOSURE   LETTER"  means  the  letter  of  the  same  date  as  this
agreement from the Seller to the Purchaser;

"DUPONT" means E.I. du Pont de Nemours and Company;

"EMPLOYEES"  means all those  individuals  employed  by the  Company  at
Completion;

"ENVIRONMENT" has the meaning in Schedule 5;

"ENVIRONMENTAL  AUTHORISATIONS" means all or any permits,  certificates,
consents,  licences,  approvals,  registrations and other authorisations
required under  Environmental  Laws and all terms and conditions thereof
required under any Environmental Law for the operation of the Business;

"ENVIRONMENTAL LAWS" has the meaning given in Schedule 5;

"ESTIMATED CONSIDERATION" has the meaning given in Clause 3;

"FIELD OF ACTIVITY" means:

(a) the  import,  export,  sale and  distribution  of  titanium  dioxide
pigments and co-products and related products; and

(b) the  manufacture  of finished  products  from the processes by which
reactor  discharge from the chloride process and calciner  discharge
from the sulphate  process are treated to produce  titanium  dioxide
pigments

and all other business and operations as carried on by the Company as at
the date hereof but for the avoidance of doubt shall not include:

(i) the  manufacture,  sale or  disposal  by way of  trade of any
organometallic  compounds  save  the  manufacture,   sale  or
disposal  of a pigment  which  incorporates  as an  essential
feature of its composition an  organometallic  compound shall
not be considered to be the manufacture,  sale or disposal of
an organometallic compound as such; and

(ii)the  manufacture,  sale or  disposal  by way of  trade of any
form of  titanium  dioxide of  ultraviolet-attenuating  grade
having a ratio of  absorbance  response  at 308 nm  (A308) to
absorbance  response  at 524 nm  (A524) of not less than 5 as
defined   in  US   Pharmacopeia,   amendment   published   in
Pharmacopeia  Forum,  Volume  22,  Number  4,  Page  2636 and
attached hereto as Annex 2.

"FINAL CONSIDERATION" has the meaning given in Schedule 6;

"FRAMEWORK  AGREEMENT"  means the agreement  dated o between ICI, DuPont
and the Purchaser;

"GUARANTEES" means all guarantees and indemnities given by the Seller or
Affiliates  of the Seller in respect of  obligations  of the  Company in
relation to the Business,  short  particulars  of which are contained in
the Disclosure Letter;

"HAZARDOUS MATERIAL" has the meaning given in Schedule 5;

"ICI" means Imperial Chemical Industries PLC;

"ICI GROUP" means ICI and its Affiliates as at the Completion Date;

"IMPLEMENTATION AGREEMENTS" means the documents in Schedule 4;

"INDEPENDENT ACCOUNTANT" has the meaning given in Clause 11;

"INTELLECTUAL  PROPERTY"  shall mean all  patents,  trademarks,  service
marks,  trade  names and all  goodwill  associated  with the  foregoing,
registered designs, copyrights,  copyrightable works (including, without
limitation,  data,  documentation  and  databases)  registered  internet
domain names,  and rights to inventions and  applications for and rights
to apply for protection or registrations  of any of the same;  including
any continuation, continuation-in-part, provisional, reissue, divisional
and  re-examination  patent  applications  and all  rights in  Technical
Information;

"INTRA-GROUP  LOANS"  means  all Net Debt due  from the  Company  to the
Seller or any  Affiliate  of the Seller or due to the  Company  from the
Seller or any Affiliate of the Seller as  determined in accordance  with
Schedule 6, and in both circumstances  relating only to those Affiliates
of the Seller following Completion;

"LIBOR"  means the rate for  deposits  in US Dollars for a period of one
month which appears on the Reuters  Screen ISDA Page (or such other page
as the parties may agree) at approximately  11.00 a.m.,  London time, on
the first day of the period to which any  interest  period  relates (the
"RELEVANT  DATE").  If such rate does not appear on the  Reuters  Screen
ISDA Page on the Relevant  Date, the rate for that Relevant Date will be
determined  as if the  parties  had  specified  that  the  rate  for the
Relevant  Date  will be  determined  on the  basis of the rates at which
deposits in US Dollars are offered by Midland Bank plc at  approximately
11.00 a.m.,  London  time,  on the  Relevant  Date to prime banks in the
London  interbank  market for a period of one month  commencing  on that
Relevant Date for amounts of US$10,000,000;

"LPC" means the Louisiana Pigment Company Limited Partnership;

"LPC BUSINESS"  means any sales sourced from LPC, any Stocks,  Operating
Debtors, Operating Creditors less than one year (the definitions of such
terms  in  Schedule  6  being  applied  to  LPC)  and  other  assets  or
liabilities  relating to LPC as determined  and  distinguished  from the
Business in accordance with Schedule 9;

"MATERIAL CONTRACTS" means all Contracts (i) which at Completion have in
excess of 12 months  to run and  which in that  time can  reasonably  be
expected to involve  income or expenditure in respect of the Business in
excess of US$200,000  per annum;  or (ii) which at Completion  have less
than 12 months to run and which in that time can  reasonably be expected
to involve income or expenditure in respect of the Business in excess of
US$500,000;  or (iii) which relate to the treatment  and/or  disposal of
waste; or (iv) which relate to contract  manufacturing  or processing of
products  by  third  parties;   or  (v)  which  relate  to  third  party
distribution  or agency in respect of  products;  or (vi) the absence of
which  would  have a  material  negative  impact on the  conduct  of the
Business;

"NET DEBT" has the meaning in Schedule 6;

"ORDINARY  COURSE OF  BUSINESS"  means the  ordinary  course of business
consistent with past custom and practice including,  without limitation,
quantity  and   frequency,   taking  into  account  the   relevance  and
reasonableness  of the same and with  allowance  made for the inherently
cyclical nature of the titanium dioxide industry;

"PARENT  UNDERTAKING"  shall have the meaning  given in  section 258  of
the United Kingdom Companies Act 1985;

"PERMITS" means all licences, permits, authorisations, registrations and
approvals  required  by  law or  regulation  or  issued  or  granted  by
statutory or other  authorities  to the Company for the operation of the
Business  (but   excluding,   for  the  avoidance  of  doubt,   planning
permissions   issued  by  relevant   planning   authorities   (save  for
Environmental  Authorisations) and any licence, permit, authorisation or
approval which falls within the definition of Regulatory Conditions);

"PLANT AND EQUIPMENT" means the plant,  machinery,  spare parts,  tools,
equipment,  chattels, motor vehicles,  furniture,  fixtures and fittings
(to the extent they are not  included in the  Properties)  and all other
tangible  personal property located at the Property  (including  without
limitation  office equipment) which in each case is owned and/or used by
the Company in relation to the Business as at Completion;

"PROPERTY" means those properties shown in Schedule 2 Part I;

"PURCHASER'S AUDITORS" means PriceWaterhouseCoopers;

"PURCHASER'S  GROUP" means the Purchaser's  ultimate parent  undertaking
and that parent undertaking's Affiliates;

"REGULATORY  CONDITIONS"  means the  anti-trust or regulatory  approvals
(other than Environmental Authorisations) necessary to complete the sale
of the Company on the terms set out in this agreement;

"SELLER'S AUDITORS" means KPMG;

"SELLER'S GROUP" means TG and Omicron's ultimate parent undertakings and
those parent undertakings' Affiliates as at the Completion Date;

"STOCK"  means  the  stocks  of  fuels,   raw  materials,   ingredients,
packaging,   office  and  laboratory   supplies,   engineering   spares,
consumable  stores,  work-in-progress  and finished  goods at Completion
held by the Company for the purposes of the Business;

"TAX" has the meaning given in the Tax Deed of Covenant;

"TAXATION" has the meaning given in the Tax Deed of Covenant;

"TAX AUTHORITY" has the meaning given in the Tax Deed of Covenant;

"TAX DEED OF  COVENANT"  means the tax deed of  covenant  in the  Agreed
Form;

"TAX LIABILITY" has the meaning given in the Tax Deed of Covenant;

"TECHNICAL  INFORMATION"  shall mean all  technical  data and  know-how,
industrial  and  technical  information,   trade  secrets,  confidential
information,  drawings,  formulations,  technical reports, operating and
testing  procedures,  instruction  manuals,  raw material or  production
specifications, the results of research and development work, whether in
hard copy or in computer  held form  (including,  for the  avoidance  of
doubt, in such media as microfilm and microfiche);

"TERRITORIES"  means the  United  States  of  America,  Canada,  Mexico,
Central and South America;

"TRACY  SITE"  means  1690 and  1694  Marie-Victorin  Boulevard,  Tracy,
Quebec, J3R IM7, Canada;

"UK GAAP" means generally accepted  accounting  principles in the United
Kingdom;

"US  DOLLARS",  or "US$" means the lawful  currency of the United States
of America;

"WARRANTIES" has the meaning given in Clause 5.1; and

"WARRANTY CLAIM" has the meaning given in sub-Clause 5.4.

1.2 Unless otherwise stated,  any express reference to an enactment includes
references to:

(a)    that  enactment  as amended,  extended or applied by or under any
other enactment before or after this agreement;

(b)    any enactment  which that  enactment  re-enacts  (with or without
modification); and

(c)    any subordinate legislation made (before or after this agreement)
under any enactment, including one within (a) or (b) above,

except to the extent that any of the  matters  referred to in (a) to (c)
occurring  after the date of this agreement  would increase or alter the
liability of any party under this agreement.

1.3 The singular  shall include the plural and vice versa and words denoting
persons shall include bodies corporate and  unincorporated  associations
of  persons  and,  unless  otherwise  stated,  shall  include  permitted
successors or assigns of such persons.

1.4 Sub-Clauses 1.1 to 1.3 apply unless the contrary intention appears.

1.5 The headings in this agreement do not affect its interpretation.

1.6 Any Schedule or Annex to this agreement  shall take effect as if set out
in this  agreement and  references to this  agreement  shall include its
Schedules and Annexes.

1.7 Where any statement in this  agreement (or in the attached  Schedules or
Annexes)  (other  than in  Schedule  3  paragraphs  H(2)  and  H(4))  is
qualified  by the  expression  "SO FAR AS THE SELLER IS AWARE,"  "TO THE
SELLER'S  KNOWLEDGE,  INFORMATION  AND BELIEF," "KNOWN TO THE SELLER" or
any  similar  statement,  that  statement  shall be  deemed  to mean the
knowledge,   after  reasonable   investigation,   of  the  officers  and
operational  and functional  managers of ICI and its Affiliates who have
direct  responsibility  for the subject  matter  concerned,  being those
listed in Schedule 9.

2 SALE AND PURCHASE OF THE SALE SHARES

2.1 The Seller shall with full title  guarantee sell and the Purchaser shall
purchase the Sale Shares together with all rights attaching to them.

2.2 The Sale Shares shall be sold free from all liens, charges, equities and
encumbrances and other rights exercisable by third parties or Affiliates
of the Seller.

3 CONSIDERATION AND ADJUSTMENTS

3.1 Subject to sub-Clause 3.3 below, the  consideration  for the sale of the
Sale  Shares  shall  be  US$[o]  payable  in  cash by the  Purchaser  on
Completion (the "ESTIMATED CONSIDERATION").

3.2 The payment under sub-Clause 3.1 shall be paid to the correspondent bank
named below for credit to the US Dollar account of o (the "ICI ACCOUNT")
referred to below:

Correspondent bank:
Bank account:
Account name:
Account no:
Sort code:

3.3 Any payments to the Purchaser  under this agreement shall be paid to the
correspondent  bank named below for credit to the US Dollar account of o
(the "PURCHASER ACCOUNT") referred to below:

Correspondent bank:
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3.4 The Final  Consideration  shall be determined and any difference between
the Estimated Consideration and the Final Consideration shall be paid in
accordance with the provisions of Schedule 6.

4 PURCHASER'S WARRANTIES

The Purchaser represents and warrants to the Seller that:

(a)    it (and each of its Affiliates,  in respect of the Implementation
Agreements to which such  Affiliate is a party) has the requisite
power and  authority to enter into and to perform this  agreement
and such Implementation Agreements;

(b)    it (and each of its Affiliates,  in respect of the Implementation
Agreements  to which such  Affiliate  is a party) has obtained or
satisfied all corporate,  regulatory and other approvals,  or any
other  significant  conditions,  necessary to execute and perform
this agreement and such Implementation Agreements;

(c)    this agreement and the Implementation Agreements constitute valid
and  binding  obligations  of  the  Purchaser  (and  each  of its
Affiliates,  in respect of the Implementation Agreements to which
such Affiliate is a party)  enforceable in accordance  with their
respective terms; and

(d)    compliance  with the terms of this agreement by the Purchaser and
the Implementation  Agreements by the Purchaser or its Affiliates
(as appropriate) will:

(i) not constitute a breach of any agreement or contract to which
the  Purchaser or such  Affiliate of the Purchaser is a party
or by which it is bound; and

(ii)be in compliance  with the  Purchaser's  or such Affiliate of
the  Purchaser's  memorandum  and articles of  association or
other constitutional documents; and

(iii) not contravene:

(a)any order, judgment or decree; or

(b)any statute, rule or regulation; or

(c)any other  restriction  of any kind by which the Purchaser
or such Affiliate of the Purchaser is bound.

5 SELLER'S WARRANTIES

5.1 The Seller represents and warrants to the Purchaser in the terms set out
in Part A.1 of Schedule 3.1 and that,  save as otherwise  stated in this
agreement and subject to all matters and circumstances  fairly disclosed
in the Disclosure  Letter,  each of the statements set out in Schedule 3
Part A.2 to N (inclusive) to this agreement (the  "Warranties")  is true
and  accurate  as  at  the  date  of  this   agreement  and  the  Seller
acknowledges  that the  Purchaser  has entered  into this  agreement  in
reliance upon the Warranties.

The Purchaser  agrees that no warranty,  representation,  undertaking or
indemnity,  or any other contractual  obligation or otherwise is made or
given by the  Seller  to  either  the  Purchaser  or its  Affiliates  in
relation to LPC.

5.2 Each of the Warranties shall be separate and independent and no Warranty
shall limit the scope or construction of any other Warranty or any other
provision of this agreement.

5.3 The Purchaser acknowledges and agrees that:

(i) save  as  may  be  set  out  in  this  agreement  or  in  the
Implementation  Agreements,  except for the Warranties and in
relation to an allegation of fraud, no statement,  promise or
forecast  made by or on behalf of the Seller or any member of
the  Seller's  Group may form the basis of, or be  pleaded in
connection  with,  any  claim  by the  Purchaser  under or in
connection   with  this   agreement  or  the   Implementation
Agreements; and

(ii)any claim by the Purchaser or any person  deriving title from
it in connection with the Warranties  shall be subject to the
following provisions of this Clause.

5.4 The  liability of the Seller in respect of any breach of the  Warranties
(a "WARRANTY  CLAIM") or the  indemnities  contained  in this  agreement
shall be  governed  by the  terms of the  Americas  Liability  Agreement
except as expressly provided therein.

5.5 The  liability  of the Seller  under or in  respect of a Warranty  Claim
shall also be limited in respect of any liability  which is  contingent,
unless and until such liability  becomes an actual  liability and is due
and payable  provided  that the Purchaser  shall not be prohibited  from
bringing  a Warranty  Claim  pending  such  liability  becoming  due and
payable.

5.6 The Purchaser acknowledges and agrees that:

(i) no  liability  shall  attach  to the  Seller by reason of any
breach of any of the Warranties or any indemnities  contained
in this  agreement to the extent that the loss  including all
relevant  costs  and  expenses  has  been  recovered  by  the
Purchaser  under  Schedule  5  or  any  other  term  of  this
agreement  or any  other  document  referred  to  herein  and
accordingly the Purchaser may only recover once in respect of
the same loss; and

(ii)in calculating  the liability of the Seller for any breach of
the  Warranties  there shall be taken into account the amount
by which any  Taxation  for which the  Purchaser is now or in
the future accountable or liable to be assessed is reduced or
extinguished  as a result of the matter  giving  rise to such
liability.

5.7 The Purchaser shall not be entitled to make any Warranty Claim:

(i) to the extent  that the claim  arises as a result only of any
change after  Completion in the  accounting  bases upon which
the  Company  values its assets or  computes  its  profits or
arises as a result of the  taxation or  accounting  policies,
bases or

practices of the Purchaser  being  different to those adopted
or used in preparing the Accounts; or

(ii)to the extent  that the matter  which  constitutes  the claim
was specifically  consented to in writing by the Purchaser in
the  knowledge  that  such  matter  would  give  rise to such
Warranty Claim.

5.8 The  Purchaser  shall not be  entitled  to  rescind  or  terminate  this
agreement after Completion in any circumstances provided that nothing in
this sub-Clause shall exclude or limit any right to rescind or terminate
for fraud.

5.9 Save as otherwise  provided in this  agreement,  the Seller shall not be
liable in respect of any Warranty Claim to the extent that the liability
of the Seller in respect thereof is incurred or increased as a result of
any  legislation not brought into force at the date of this agreement or
as a result of any change in or repeal of legislation  hereafter or as a
result of the  introduction  or cessation of or change in the  published
practice of any taxation authority after the date of this agreement.

5.10 The Purchaser  shall not be entitled to make any claim in respect of any
breach or alleged breach of the Warranties to the extent that:

(i) the facts,  matters or circumstances  giving rise thereto (in
respect of which any such claim or alleged claim arises) have
been fairly disclosed in the Disclosure Letter; or

(ii)such  claim  arises  or  is  incurred  as  a  result  of  any
voluntary  act or omission of the  Purchaser or any Affiliate
of the Purchaser  after the date of this agreement other than
any such act or omission  which is in the ordinary  course of
business  or is  required  by law or is pursuant to a legally
binding  commitment  of  the  Company  or any  member  of the
Seller's Group created or entered into before Completion.

5.11 The  provisions of this Clause 5 shall have effect  notwithstanding  any
other provisions of this agreement.

6 SELLER'S INDEMNITY

6.1 The Seller  undertakes to indemnify and keep  indemnified the Purchaser,
its Affiliates and the Company (the  "INDEMNIFIED  PARTIES") against all
claims  by  third  parties  (other  than  any  subsequent  purchaser  or
purchasers  of either the Sale  Shares or the  business or assets of the
Company and their successors in title or assigns) giving rise to Adverse
Consequences  which  may be paid,  suffered  or  incurred  by any of the
Indemnified  Parties  or to which  any of the  Indemnified  Parties  may
become  subject,  and which  arise as a result of the  operation  of the
Business by the Company  prior to  Completion  (unless and to the extent
that the  circumstances  giving  rise to the Adverse  Consequences  were
fairly  disclosed  in  the  Disclosure  Letter)  and  including  without
limitation those Adverse Consequences arising:

(a)    as a result of the failure by the Company to comply with relevant
and  legally   enforceable   corporate  or  other  laws,   rules,
ordinances or  regulations  with respect to the operations of the
Business prior to Completion;

(b)    as a result of the  failure  by the  Company  to obtain  required
relevant  governmental  permits,  licences,   consents  or  other
authorisations  with  respect to the  operation  of the  Business
prior to Completion;

(c)    from or with respect to any breach of  contract,  tort or product
liability  or  otherwise  arising  from,  or with respect to, the
operation of the Business prior to Completion and asserted by any
third party; and

(d)    from or with respect to any suit,  action,  arbitration,  charge,
governmental  investigation,  claim,  litigation  or  proceedings
affecting the Business or the Company.

Provided that the indemnity  contained in this Clause 6 shall not
apply to:

(i) liabilities  expressly  assumed by the Purchaser  pursuant to
this agreement or the Implementation Agreements; or

(ii)to the  extent  that such  liabilities  have been  taken into
account in establishing the Final Consideration; or

(iii) any Environmental  Liabilities,  any failure or omission to
obtain  or  comply  with  Environmental  Authorisations,  any
failure or omission to comply with any Environmental  Laws or
any claim by any person in  respect of any matter  concerning
the   Environment   (indemnity   for  which  is  provided  in
sub-Clause 9.2 and Schedule 5); or

(iv) Taxation  (indemnity  for which is  provided  in the Tax
Deed of Covenant); or

(v) LPC.

6.2 The  Purchaser  agrees to give the  Seller  notice of any and all claims
asserted  against the  Purchaser  for which  indemnification  under this
Clause  6 is or may be  sought.  Such  notice  shall be given as soon as
reasonably  practicable after the Purchaser becomes aware that it has or
may have a claim  against  the Seller.  Under this Clause 6,  failure to
give such notice shall not abrogate or diminish the Seller's  obligation
under  this  Clause  if the  Seller  has or  receives  knowledge  of the
existence  of any such claim by any other means or if such  failure does
not prejudice the Seller's ability to defend such a claim.

7 COMPLETION

7.1 Completion shall take place at the offices of the [        ] immediately
after the signature of this agreement when:

(a)    each  party  shall  provide  to  the  others  evidence  in a form
reasonably  satisfactory  to the others  that it (and each of its
relevant  Affiliates  entering into an Implementation  Agreement)
has  all  necessary  corporate  approvals  and  consents  and its
signatories have necessary authority to enter into this agreement
and the other agreements referred to herein;

(b)    each party shall (or shall  procure that its relevant  Affiliates
will) duly  execute and, to the extent  applicable,  complete the
Implementation Agreements and the Tax Deed of Covenant;

(c)    the Seller  shall  deliver to the  possession  and control of the
Purchaser:

(i) a duly  executed  transfer  or  transfers  in  favour  of the
Purchaser  (or  such   Affiliate  of  the  Purchaser  as  the
Purchaser may nominate) of all the Sale Shares;

(ii)share  certificate(s) or other documents of title relating to
the Sale Shares (or an express indemnity in a form reasonably
satisfactory  to the  Purchaser  in the  case of any  missing
certificates or documents of title);

(iii) the  company  books  relating  to  the  Company,  including
certificates of  incorporation,  common seals,  minute books,
statutory  registers,   shareholders'  agreements  and  share
certificate books (duly written up to date);

(iv) resignations  of all the  directors and secretary of the
Company;

(v) the  written  resignation  of the  auditors of the Company to
take effect on  Completion,  with  acknowledgments  signed by
them to the  effect  that  they  have no  claim  against  the
Company  and to the effect  that  there are no  circumstances
connected with their  resignation  which they consider should
be brought to the notice of the  shareholders or creditors of
the Company;

(vi)bank  statements  in  respect  of  every  account  which  the
Company has, dated two days prior to the Completion  Date and
the  relevant  reconciliation   statements  prepared  on  the
previous Business Day;

(vii)the Business Data;

(viii)the  documentation  and   title  deeds to the  Property  in
accordance with the provisions of Part II of Schedule 2;

(ix)the  Implementation  Agreements  duly  executed by the Seller
and/or Affiliates of the Seller as applicable; and

(x) the Disclosure Letter;

(d)    the   Purchaser   shall   pay  to  the   Seller   the   Estimated
Consideration;

(e)    the Purchaser or another  member of the  Purchaser's  Group shall
procure  that all  Intra-group  Loans due from the Company to the
Seller or any  Affiliate  of the Seller are repaid by the Company
and the  Seller or another  member of the  Seller's  Group  shall
procure  that all  Intra-group  Loans due to the Company from the
Seller or any Affiliate of the Seller are repaid by the Seller or
its relevant Affiliates;

(f)    the Seller shall take or shall  procure the taking of, such steps
as may be necessary to:

(i) approve  the  transfers   referred  to  in  Clause  7.1(c)(i)
(subject only to the Purchaser arranging and paying any taxes
or duties arising in relation to the transfer); and

(ii)appoint such  directors  and  secretary as the  Purchaser may
specify as directors and the secretary of the Company; and

(iii) release the securities,  guarantees, claims and indemnities
existing  immediately  prior to  Completion  other than those
arising in the Ordinary Course of Business, owed or due to or
claimed by the Seller or any  Affiliate  (being an  Affiliate
after  Completion)  from  the  Company,   true  and  complete
particulars of which are set out in Schedule 10;

(g)    each party and the Purchaser shall deliver a copy of the Tax Deed
of Covenant duly executed to the other parties.

8 EMPLOYEES

8.1 The  Purchaser  agrees to procure  that the Company for a period of four
years from the Completion Date, will procure that:

(a)    the Employees will receive and enjoy contractual remuneration and
benefits  (including  separation and other benefits  described in
the Disclosure  Letter) which,  judged  objectively,  are no less
favourable  overall  than  their  contractual   remuneration  and
benefits at the Completion Date; and

(b)    it  will  not  make  any  unilateral   material   change  to  the
contractual terms and conditions of employment with the Employees
without prior  consultation  and  concurrence  as required by any
local  laws  or  agreements,   with   recognised   trade  unions,
appropriate employee representatives, or the Employees.

8.2 The Seller will procure that, on or before Completion,  the Company will
discharge its  liability to Mr. Guy Gauthier in respect of  Supplemental
Employment Terms.

8.3 For the purposes of this clause,  "SUPPLEMENTAL  EMPLOYMENT TERMS" shall
mean:

8.3.1  the period of additional  notice (if any) due from the Company at
the date such  liability  crystallises  under the  arrangement in
force as at Completion  which is in excess of that which he would
have received under the terms of his service  agreement  dated 25
October 1990;

8.3.2  the supplemental  retirement benefits that are in addition to the
benefits to which Mr.  Gauthier  is entitled  under the TCI Staff
Employees' Pension Plan; and

8.3.3  any other  enhancements to his terms and conditions of employment
granted  between 25 October 1990 and  Completion and which are in
force as at  Completion  other than those granted in the Ordinary
Course of Business.

8.4 The Seller will  indemnify  the  Purchaser  (for itself and as agent and
trustee  for the  Company)  on a  continuing  basis  against any and all
losses or liabilities, costs (including without limitation legal costs),
charges, expenses,  actions,  proceedings,  claims and demands which the
Purchaser  or the Company may incur and which  relate to or arise out of
the continuation after Completion of the Supplemental Employment Terms.

8.5 The  Purchaser  acknowledges  and agrees that all of the funds set aside
(or due at  Completion  to be set  aside) by the  Company  (in trust and
including  related  refundable tax amounts with Revenue  Canada) for the
purpose  of meeting  the  liability  of the  Seller  and the  Company to
provide  supplemental  retirement benefits for Mr. Gauthier will be used
for  this  purpose.  The  funds  held in trust  are held at Royal  Trust
Company 1 Place Ville Marie Montreal in account nos.  554114673-001  and
554 831932.  If these funds have not been used for this  purpose  before
Completion,  the Purchaser  will procure that the Company  complies with
any  directions  given by the Seller as to the use of these  funds after
Completion for the purpose of providing such benefits for Mr. Gauthier.

8.6 The Seller will  indemnify  the  Purchaser  (for itself and as agent and
trustee  for the  Company)  on a  continuing  basis  against any and all
losses or liabilities,  costs (including without limitation legal costs)
charges, expenses,  actions,  proceedings,  claims and demands which the
Purchaser  or the  Company  may  incur  as a  result  of  the  severance
payments, pension entitlements, accelerated pension entitlements and any
other  benefits  actually  paid  to any  employee  whose  employment  is
terminated  after  Completion  if  and  to  the  extent  such  payments,
entitlements  and/or  benefits  are in excess of those  which would have
applied at any time in the period  prior to 10 September  1997  Provided
always  that the  dismissal  which  results  in the excess  costs  being
incurred  takes effect within four years of  Completion  and the regular
salary figure used in the  calculations is one which has been prevailing
in respect of the  relevant  employee  for at least six months  prior to
termination.   This  indemnity   shall  not  extend  to  any  losses  or
liabilities,  costs (including  without limitation legal costs) charges,
expenses, actions,  proceedings,  claims and demands which the Purchaser
or the  Company  may  incur as a result  of its or their  negligence  or
default. Any claims under this indemnity must be made within 4 years and
3 months of  Completion  following  which this  indemnity  shall have no
effect.

8.7 The Seller shall not be required to make any payment under the indemnity
set out in sub  clause 8.6  unless a draft  certificate  shall have been
delivered to it by the Purchaser within 30 days after the date requiring
the Seller to indemnify  the Purchaser  pursuant to  sub-clause  8.6 and
certifying the amount payable thereunder.  In order to enable the Seller
to review  the  certificate,  the  Purchaser  shall (to the extent it is
permitted by law to do so) make  available and supply to the Seller and,
at the Seller's request and expense,  the Seller's  auditors,  copies of
all relevant  records and other working papers)  relating to the subject
matter of the indemnity, during normal office hours.

8.8 If the Seller  does not within 30 days after  presentation  to it of the
draft  certificate  give notice to the Purchaser  that it disagrees with
the certificate or any item thereof, such notice stating the reasons for
the  disagreement  in reasonable  detail,  the draft  certificate  shall
become final and binding on the parties for all purposes.

8.9 If the Seller  gives a valid  notice  within  such 30 days,  the parties
shall attempt in good faith to reach  agreement in respect  thereof and,
if they are unable to do so within 21 days of such notification,  either
party  may  by  notice  to  the  other  refer  the  certificate  to  the
Independent  Accountants in accordance  with the provisions of clause 11
of this agreement which shall apply mutatis mutandis,  references to the
"COMPLAINANT"  being  deemed  to  be  references  to  the  "SELLER"  and
references to the "OTHERS" being to the "PURCHASER".

8.10 The Seller  shall pay interest at the rate of LIBOR plus 200 basis point
compounded monthly on all payments pursuant to this clause from the date
of delivery of the draft certificate.

9 PROPERTY AND ENVIRONMENTAL

9.1 The Seller and the Purchaser shall observe and perform the provisions of
Schedule  2  expressed  to be  observed  and  performed  by each of them
respectively.

9.2 The Seller and the Purchaser  shall observe the provisions of Schedule 5
expressed to be observed and performed by each of them respectively.

10 PENSIONS

The Purchaser  agrees to procure that the Company will,  commencing with
the Completion Date,  respect and perform the provisions of the Canadian
Schemes.

11 INDEPENDENT ACCOUNTANT

11.1 If either party wishes to refer any matter in dispute in accordance with
the  provisions of Clause 3 or Schedule 6 for  determination  under this
Clause it shall give notice to the other requiring the appointment of an
independent   accounting   firm   of   international   reputation   (the
"INDEPENDENT  ACCOUNTANT")  excluding accounting firms who have acted as
auditors of either party or of any of their  Affiliates in the last five
years.  If  the  parties  are  unable  to  agree  upon  the  Independent
Accountant  within  14  days  of  such  notice,   then  the  Independent
Accountant shall be appointed by the President for the time being of the
Institute  of  Chartered   Accountants  in  England  and  Wales  on  the
application of either party.

11.2 If the Independent  Accountant  delays or becomes unwilling or incapable
of acting or if for any other reason the President for the time being of
the Institute of Chartered  Accountants  in England and Wales thinks fit
he may  discharge  the  Independent  Accountant  and,  in the absence of
agreement between the parties, appoint another in its place.

11.3 The  Independent  Accountant  shall  act  as an  expert  and  not  as an
arbitrator and his decision shall (in the absence of manifest  error) be
final and  binding on the  parties.  The  Independent  Accountant  shall
afford the parties the opportunity of making written  representations to
them and shall make its determination within 40 days of its appointment.

11.4 The fees and expenses of the  Independent  Accountant  shall be borne by
the parties in equal shares unless the Independent Accountant determines
otherwise.

12 PROTECTIVE COVENANTS

The Seller  covenants  with the Purchaser that no member of the Seller's
Group will:

(a)    for a period of five years from Completion within any part of the
Territories  carry on or be engaged or  involved  in the Field of
Activity  (save as provided in  sub-Clause  12.4 below and as the
owner for  investment  purposes  only of  securities  traded on a
recognised  stock exchange and not exceeding one per cent. of the
securities of that class); or

(b)    without prior  approval from the  Purchaser,  for a period of two
years  from  Completion,   directly  or  indirectly  solicit,  or
endeavour to entice away from the Purchaser or its Affiliates any
of the Employees.

12.1 Each of the  restrictions  in sub-Clause 12.1 above shall be enforceable
independently  and its  validity  shall not be  affected if the other is
invalid.

12.2 The Seller  acknowledges  that the  provisions  of this Clause 12 are no
more extensive than is reasonable to protect the Company.

12.3 Nothing in this Clause 12 or in this agreement shall prevent:

(a)    the  Seller  or its  Affiliates  from  purchasing  shares  in any
company or any  business  which has an  interest  in the Field of
Activity  (the  ownership  of which  would  otherwise  contravene
sub-Clause   12.1)   unless  the  turnover  of  such  company  or
business in its last  accounting  year  generated by its interest
in the Field of  Activity  was the  greater of 10 per cent of the
aggregate  turnover  of  such  company  or  business  and  US$100
million.  In the event that the  Seller or any of its  Affiliates
within five years from  Completion  purchases any  corporation or
business  which  does have  interests  in the Field of  Activity,
the Seller or the relevant  Affiliate are  contractually  obliged
to offer for sale such interests to DuPont.

If DuPont does not purchase  such  interests  from the Seller (or
its relevant  Affiliate),  the Seller (or the relevant Affiliate)
shall,  if  DuPont  shall  fail to or does not  accept  the offer
referred to above  within such period to which it is entitled for
such  purpose,  within 30 days of receipt,  from DuPont of notice
that DuPont does not intend to purchase such interests  offer for
sale such  interests to the  Purchaser on terms which are no less
favourable by written notice ("OFFER NOTICE").

If the Purchaser does not unconditionally purchase such interests
from the Seller (or its relevant  Affiliates)  within a period of
18 months after the date of the Offer Notice, then the Seller (or
the relevant  Affiliate)  shall be free to retain such  interests
with  the  consent  of  the  Purchaser  (such  consent  not to be
unreasonably  withheld or delayed). If such consent is reasonably
withheld,  then the Seller (or the relevant  Affiliate) shall use
its best endeavours to divest such interests  within 12 months of
such consent having been withheld; or

(b)    the Seller or its Affiliates from carrying on or being engaged or
involved in:

(i) any  business  it  currently   carries  on  (other  than  the
Business);

(ii)any  business  which  only  supplies  other  members  of  the
Seller's Group; or

(iii) any  business  after  such  time  as the  Purchaser  or its
Affiliates  have ceased to carry on or be engaged or involved
in such business other than by way of trade sale; or

13 ANNOUNCEMENTS

The  parties  agree that no party shall make or permit any member of the
Seller's Group or the Purchaser's Group, as the case may be, to make any
announcement concerning this agreement or any ancillary matter except as
required  by law or any  competent  regulatory  body or with  the  prior
written  approval  of the other  party  which  will not be  unreasonably
withheld or delayed.

14 DEFAULT INTEREST

Subject as otherwise provided to the contrary in this agreement,  if any
sum due for payment  under this  agreement  or in  accordance  with this
agreement  is not paid on the due date,  the party in default  shall pay
Default  Interest on that sum from the due date until the date of actual
payment calculated on a day-to-day basis.

15 NOTICES

15.1 Any notice or other document to be served under this agreement  shall be
in writing and may be delivered by hand or by courier, sent by fax or by
post  to the  party  to be  served  at its  address  appearing  in  this
agreement  (and  marked for the  attention  of the person  whose name is
referred  to in  sub-Clause  15.3  below) or at such other  address  (or
marked for the  attention of such other  person) as it may have notified
to the other  party in  accordance  with this  Clause  15. Any notice or
other  document sent by post shall be sent by  registered  post (if both
posted and for delivery within the same  jurisdiction)  or by registered
airmail (if posted for delivery  outside the jurisdiction in which it is
posted),  in either case return receipt  requested (or any substantially
equivalent service).

15.2 Any notice or document  delivered or sent in accordance  with sub-Clause
15.1 shall be deemed to have been served:

15.2.1 if delivered by hand or by courier, at the time of delivery; or

15.2.2 if sent by fax,  at the time of delivery  if sent  between  12.01
a.m.  and 6.00 p.m.  (local  time at the  destination)  or on the
Business Day after transmission, if sent at any other time;

15.2.3 if posted,  at 10.00 a.m. on the second Business Day after it was
put  into  the  post if  posted  for  delivery  within  the  same
jurisdiction, or at 10.00 a.m. (local time at the destination) on
the  fifth  Business  Day after it was put in the post if sent by
registered airmail.

15.3 The person to whom  notices or  documents  should be  addressed  for the
purposes of sub-Clause 15.1 is:

(a)    if to be served on TG or on Affiliates of TG:

[               ]

Fax:

copy to the Company  Secretary  of Imperial  Chemical  Industries
PLC of Imperial Chemical House, 9 Millbank, London, SW1P 3JF;

Fax: (44) 171 798 5170

(b) if to be served on Omicron or on Affiliates of Omicron:

[             ]
copy to the Company Secretary of Imperial Chemical Industries
PLC of Imperial Chemical House, 9 Millbank, London SW1P 3JF;

Fax: (44) 171 798 5170

(c) if to be served on the Purchaser:

General Counsel
NL Industries, Inc.
16825 North Chase Drive
Suite 1200
Houston, Texas USA TX 77060

Fax: (1) 281 423 3333

15.4 In proving  service of a notice or  document it shall be  sufficient  to
prove  that  delivery  was  made by  hand,  courier  or fax or that  the
envelope  containing  the notice or document was properly  addressed and
posted (either by registered post or by registered  airmail, as the case
may be, in accordance with the requirements of this Clause 15).

16 GENERAL

16.1 Each of the  obligations,  Warranties and  undertakings  set out in this
agreement  which is not fully  performed at Completion  will continue in
force after Completion.

16.2 Unless  otherwise  expressly  stated all claims made and  payments to be
made under this agreement  shall be made in US Dollars.  Payments to the
Seller shall be made in  immediately  available  funds to the account of
the Seller at such account as the Seller may notify to the Purchaser and
to the Purchaser in immediately  available  funds to such account as the
Purchaser  may notify to the Seller.  All payments and values under this
agreement  shall be in US  Dollars  and where an  amount  is not  itself
calculated in US Dollars,  it shall be converted  into US Dollars at the
mid-market  closing  exchange  rate for that  currency  in US Dollars as
published in the London  Edition of The  Financial  Times  published two
Business Days prior to the date on which the relevant  payment is due or
where no such rate is published, at the rate quoted by Citibank, N.A. at
the close of business in London on that date.
This sub-Clause shall not apply to Schedule 6.

16.3 Save as  otherwise  provided  to the  contrary in this  agreement,  each
payment to be made under this agreement shall be made in the currency in
which the relevant  amount is payable,  free and clear of all deductions
or  withholdings  of any kind,  except for those required by law, and if
any deduction or withholding  must be made by law, an additional  amount
will be paid which is necessary to ensure that the recipient  receives a
net amount equal to the full amount which it would have  received if the
payment had been made without the deduction or withholding.

16.4 None of the rights or  obligations  under this agreement may be assigned
or  transferred  without the written  consent of the other  parties (the
"NON-ASSIGNING PARTIES") other than an assignment of the rights (but not
the obligations) to an Affiliate of the assigning party provided that:

(a)    such assignment  shall only be permitted if the assignment has no
adverse effect on the Non-assigning Parties;

(b)    if the Affiliate to which the rights have been assigned ceases to
be an Affiliate  of the  assigning  party,  the rights which have
been  transferred  shall be  re-transferred  to the  party  which
originally  assigned those rights or to another Affiliate of that
original assigning party; and

(c)    it shall be a condition of any such  assignment  that  reasonable
notice is given in  writing to the  Non-assigning  Parties of the
proposal  to  assign  (identifying  the  rights  proposed  to  be
assigned,  the identity of the  proposed  assignee and such other
details  relating  thereto  as  the  Non-assigning   Parties  may
reasonably require).

16.5 Save as otherwise  provided in this agreement,  each party shall pay the
costs and expenses  incurred by it and its Affiliates in connection with
the entering into and completion of this agreement.

16.6 This  agreement  may be executed in any number of  counterparts,  all of
which taken together shall constitute one and the same agreement and any
party may enter into this agreement by executing a counterpart.

16.7 No amendment,  variation or waiver of this agreement or any provision of
this agreement shall be effective  unless it is in writing  specifically
referring to this  agreement  and duly  executed by or on behalf of each
party.

16.8 Each party shall at their own expense at all times from the date of this
agreement  do all  things  as may be  required  to give  effect  to this
agreement including,  without limitation, the execution of all deeds and
documents,  procuring the  convening of all meetings,  the giving of all
waivers and consents and the passing of all  resolutions  and  otherwise
exercising all powers and rights available to them.

17 WHOLE AGREEMENT

17.1 Subject  to  sub-Clause  17.2,  below  this  agreement,   the  Framework
Agreement  and the  Implementation  Agreements  (if and  when  executed)
contain the whole  agreement  between  the parties and their  respective
Affiliates  relating to the transactions  contemplated by this agreement
and the Implementation  Agreements and supersede all previous agreements
between  the parties and their  respective  Affiliates  relating to such
transactions.

17.2 A provision in another  agreement  between the parties to this agreement
or between  the  respective  parent  undertakings  of the  parties  (and
whether made before or after the date of this agreement) which refers to
this  agreement and which extends or  supplements  any provision in this
agreement  will be deemed for the purposes of  sub-Clause  17.1 above to
form part of the whole  agreement  between the parties as referred to in
that sub-Clause.

17.3 Each of the parties to this agreement acknowledges on its own behalf and
on behalf of each of its Affiliates that, in agreeing to enter into this
agreement and the  Implementation  Agreements,  it has not relied on any
representation, warranty, collateral contract or other assurance (except
those set out in this  agreement)  and waives  all  rights and  remedies
which,  but for this  sub-Clause,  might otherwise be available to it in
respect of any such  representation,  warranty,  collateral  contract or
other  assurance,  provided  that  nothing in this Clause shall limit or
exclude any liability for fraud.

18 GOVERNING LAW

This agreement is governed by and shall be construed in accordance  with
English law.

19 JURISDICTION

19.1 The parties agree subject to sub-Clause  19.2 to submit to the exclusive
jurisdiction  of the courts of the State of  Delaware  for all  purposes
relating to this agreement.

19.2 If the courts of the State of Delaware decline jurisdiction, the English
courts shall have exclusive  jurisdiction  for all purposes  relating to
this agreement.

19.3 In both sub-Clause 19.1 and 19.2, neither party shall take any action to
avoid,  dispute  or suggest  to such  court  that such  jurisdiction  is
improper.

19.4 The Seller appoints ICI American  Holdings Inc of 3411 Silverside  Road,
Wilmington,  Delaware  19850,  USA as its  authorised  agent  upon  whom
process may be served in any legal suit,  action or  proceeding  arising
out of or based  upon  this  Agreement  which may be  instituted  in the
courts of the State of Delaware.

19.5 If the English courts have jurisdiction, the Seller irrevocably appoints
Imperial Chemical Industries PLC of Imperial Chemical House 9, Millbank,
London SW1P 3JF as its agent for  process in England  and the  Purchaser
irrevocably appoints Herbert Smith (Ref 554) of Exchange House, Primrose
Street, London, EC2A 2HS as its agent for process in
England.

AS  WITNESS  the  hands of the duly  authorised  representatives  of the
parties on the date which first appears on page 1.

SCHEDULE 1
PARTICULARS OF THE COMPANY

Date and Place of           27 July 1959; Quebec, Canada
Incorporation:

Registered Office:          1690 Route Marie-Victorin,
Tracy, Quebec, J3R 1M7
Canada

Authorised Share Capital:   an  unlimited   number  of  Common   Shares  and  an
unlimited  number  of Class A  Special  Shares  both
without nominal or par value which may be issued for
an unlimited consideration

Shareholders and Issued     Tioxide Group Limited - 135,000 Common Shares
Share Capital:              ICI Omicron BV - 37,000 Class A Special Shares

Directors:                  Rene Lachance
Guy Gauthier
John A. Collingwood

Secretary:                  Rene Lachance

SCHEDULE 2
PROPERTIES
(CLAUSE 1)
PART I

NO.     ADDRESS                       ESTATE OR INTEREST             USE

1       Factory at 1690 and 1694      Freehold                  Titanium dioxide
Marie-Victorin Boulevard,                               finishing plant
Tracy, Quebec.

2       Land at Lot 708-102 of the    Freehold                  Site for
Official Cadastre of the                                titanium
Parish of Notre-Dame-de-la-                             dioxide plant
Nativite-de-Becancour
and Lot 879-10 of the
Official Cadastre of the
Parish of Saint-Edouard-
de-Gentilly.

3       9999 Cavendish Boulevard,     Leasehold                 Former offices
Ville St. Laurent.                                      now sub-let

4       350 Burnhamthorpe Road West,  Leasehold                 Offices
Suite 210, Mississaga.

PART II

On  Completion,  the Seller shall  deliver up to the Purchaser all title
documentation  (and other  documentation  disclosed to the Purchaser) in
connection with the Properties.

SCHEDULE 3
WARRANTIES

A. GENERAL

A.1 CAPACITY AND CONDUCT OF BUSINESS

(1) The Seller (and each of its Affiliates in respect of the  Implementation
Agreements  to which  they are  parties)  has the  requisite  power  and
authority to enter into and to (otherwise as provided in this agreement)
perform this agreement and such Implementation Agreements.

(2) The Seller (and each of its Affiliates, in respect of the Implementation
Agreements  to which they are parties) has  obtained and  satisfied  all
corporate,  regulatory  and other  approvals,  or any other  conditions,
necessary  to execute and  (otherwise  as  provided  in this  agreement)
perform this agreement and the Implementation Agreements.

(3) This  agreement and the  Implementation  Agreements  constitute (or when
executed will  constitute)  valid and binding  obligations of the Seller
(and each of its Affiliates in respect of the Implementation  Agreements
to which they are parties) enforceable in accordance with their terms.

(4) The execution  and  compliance  with the terms of this  agreement by the
Seller and the Implementation Agreements by the Seller or its Affiliates
(as appropriate) will:

(a) not constitute a breach of any material contract to which the
Seller (or any of its  Affiliates)  is a party or by which it
or they are bound or entitle any person to terminate or avoid
any such agreement or contract;

(b) be  in  compliance   with  the  Seller's  and  the  Company's
memorandum    and   articles   of    association   or   other
constitutional documents (or those of any of its Affiliates);

(c) not contravene:

(i)  any order, judgment or decree; or

(ii) any statute, rule or regulation; or

(ii) any other  restriction  of any kind by which the  Seller
or any of its Affiliates or the Company is bound; or

(b) not result in the loss or  impairment of or any default under
any licence, authorisation or consent required by the Company
for the purposes of its business.

(5) All factual  information  contained  in this  agreement  relating to the
Company is true and accurate in all material respects.

(6) There are no  outstanding  powers of attorney  executed on behalf of the
Company.

A.2 THE COMPANY

(1) The  information  relating  to the  Company  contained  in Schedule 1 is
true and accurate.

(2) Compliance has been made with all legal  requirements in connection with
the  formation  of the  Company  and all  issues  and  grants of shares,
debentures or other securities of the Company.

A.3 OWNERSHIP OF THE SALE SHARES

(1) The Seller is the sole legal and  beneficial  owner of the Sale  Shares.
The Sale  Shares  constitute  the  entire  issued  share  capital of the
Company.

(2) The Seller is  entitled  to sell and  procure  the  transfer of the full
legal  and  beneficial  ownership  in the  Sale  Shares  free  from  any
encumbrance,  equity  or  third  party  right  of  any  kind  or  nature
whatsoever,  from any  agreement  or contract to grant the same and from
any claim to any of the same.

(3) The Sale  Shares  are fully  paid up or  credited  as fully  paid up and
constitute  the whole of the issued and allotted  share capital owned by
the Seller in the Company.

(4) No agreement  or contract  has been  entered into which  requires or may
require the Company to allot or issue any share or loan  capital and the
Company has not allotted or issued any securities  which are convertible
into share or loan  capital and there are no voting  trusts,  proxies or
other  agreements  or  understandings  with respect to the voting of the
Sale Shares.

A.4 SUBSIDIARIES

(1) The Company is not the holder or beneficial  owner of (nor has agreed to
acquire) any class of any shares or loan capital or other  securities of
any other corporation (whether incorporated in Canada or elsewhere).

(2) The  Company  is not  and has not  agreed  to  become  a  member  of any
partnership  or  other  unincorporated  association,  joint  venture  or
consortium (other than recognised trade associations).

(3) The  Company   does  not  have  any  place  of  business  or   permanent
establishment   (as  that  expression  is  defined  in  double  taxation
conventions) outside Canada.

A.5 OWNERSHIP OF ASSETS

(1) Except for those Assets that are leased (as described in the  Disclosure
Letter),  the Company has full legal and beneficial  title to all Assets
(whether  tangible or  intangible)  reflected in the Accounts  (save for
current  assets and fixed  assets  worth less than  US$100,000,  both as
defined for the purposes of the Accounts,  disposed of by the Company in
the Ordinary  Course of its Business since the  Accounting  Date) and to
all assets acquired by the Company since 28 February 1998.

(2) None of the  Assets is subject to any  encumbrance  (including,  without
limitation,  any debenture,  mortgage, charge, lien (other than any such
lien  arising  by  operation  of law or by  statute),  deposit by way of
security,  bill of sale,  option or right of  pre-emption)  except those
that arise in the Ordinary Course of Business and do not have a material
adverse  effect  on the  Business.  All  significant  items of Plant and
Equipment  have been  regularly  and  adequately  maintained  where such
maintenance  is normally  required and are in  reasonable  working order
having  regard to their age and use and taken as a whole are  capable of
operating the Business fully and effectively as conducted by the Company
prior to Completion.

(3) Save for  fluctuations  and  variations in Stock due to normal  business
factors including,  without limitation,  production schedules and market
demand  (including  seasonal  factors  affecting the same) the Stocks in
aggregate comprise broadly the same mix of products as has been required
and has been maintained at levels  sufficient to meet the level of sales
of the  Business for the last four  quarters.  The Stock is owned by the
Company free and clear of all liens,  claims,  charges and  encumbrances
other than any such liens arising by operation of law or by statute. The
Stock is located at the Tracy Site and as  disclosed  in the  Disclosure
Letter.

(4) The  Company  owns or has the right to use all the  property  rights and
assets  necessary for the Company to carry on fully and  effectively the
Business  in the  manner in and to the  extent to which it is  presently
conducted.

(5) The  Business  Data taking into  account the time,  purpose,  nature and
context in which it was prepared is in all material respects a bona fide
and  accurate  record  and  in  the  Seller's  opinion  is  collectively
sufficient for the purposes of conducting the Company's  business in the
Ordinary  Course  of  Business.  The  Business  Data  and the  Company's
information,  and the means of access to them, are exclusively  owned by
it and under its direct control or are under its authority.

(6) The  Disclosure   Letter  contains  details  of  the  current  insurance
arrangements  applicable to the Company.  Those arrangements are in full
force and effect,  all  premiums  have been duly paid and, so far as the
Seller is aware, nothing has been done or omitted to be done which would
make any policy of insurance  of the Company void or voidable.  There is
no claim outstanding under any such arrangement.

A.6 COMPLIANCE WITH STATUTES

The Company has complied  with all  applicable  laws  (including  rules,
regulations  both  having  the  force  of law,  injunctions,  judgments,
orders,  decrees,  rulings, and charges thereunder) of national,  local,
and foreign governments (and all agencies thereof), and no action, suit,
proceeding, hearing, investigation, charge, claim, demand, or notice has
been filed or commenced  against the Company  alleging any failure so to
comply.

A.7 LICENCES AND CONSENTS

The Company has all Permits  necessary to own and operate its Assets and
to carry on the  Business  in the manner in which such  business  is now
carried  on. All such  Permits  are valid and  subsisting  and have been
complied  with in all material  respects.  The Company has paid all fees
due under the same. A list of material  Permits has been  disclosed  and
identified  in the  Disclosure  Letter  and the  list  identifies  those
material  Permits which allow for  revocation on a change in controlling
shareholder.

A.8 LITIGATION

(1) The Company is not engaged in any litigation or arbitration  proceedings
except as plaintiff for  collection  of debts in the Ordinary  Course of
Business which is likely to involve the Company  claiming or paying sums
in excess of US$100,000 or which  otherwise will have a material  effect
on the  operation  of the Company and the Business and there are no such
proceedings pending and no letter before action has been received by the
Company and so far as the Seller is aware  there are no facts  likely to
give rise to any such  proceedings.  The  Seller  has  disclosed  in the
Disclosure Letter a list (which is complete and accurate in all material
respects)  which includes a description of each pending law suit,  claim
(including    customer    complaints),    administrative    proceedings,
arbitration,  labour dispute or governmental investigation or inspection
to  which  the  Company  is a party or  involves  the  operation  of the
Business or involves the Sale Shares and in each case which is likely to
involve the Company claiming or paying sums in excess of US$100,000. The
Seller has disclosed  all material  (individually  or in the  aggregate)
product liability claims received by the Company or by the Seller during
the last  three  years.  There  are no  orders,  decrees,  judgments  or
agreements with any court or governmental authority to which the Company
or the  Seller  (on  behalf of the  Company)  is a party or by which the
Company or the Seller or the Sale Shares are bound and which will have a
material effect on the operation of the Company and its business.

(2) No  administrator,  receiver  or  administrative  receiver  or any other
equivalent  officer has been  appointed  in respect of the Company or in
respect of any parts of the assets or undertakings of the Company.

(3) No petition has been  presented,  no order has been made,  no resolution
has been passed and no meeting has been  convened for the  winding-up of
the Company or for an administration order to be made in relation to the
Company nor has any such order been made.

(4) No  voluntary  arrangement  has  been  approved  and  no  compromise  or
arrangement  has been  sanctioned in respect of the Company  pursuant to
any applicable bankruptcy or insolvency legislation.

(5) The Company has not become unable to pay its debts.

(6) No distress,  distraint,  charging order,  garnishee order, execution or
other  process has been levied or applied for in respect of the whole or
any  part  of any of the  Property,  Assets  and/or  undertaking  of the
Company.

A.9 ENVIRONMENTAL MATTERS

(1) Environmental Authorisations

(a) The  Company  has   lawfully   obtained   all   Environmental
Authorisations  and each such  authorisation is in full force
and effect and the Company has complied at all times with and
can continue to comply in the future with all  conditions  of
such authorisations.

(b) No works or  costs  are or will be  necessary  to  obtain  or
secure compliance with or maintain any existing Environmental
Authorisations  or their  conditions  or  otherwise to comply
with Environmental Laws.

(c) The Company  has  received  no  communication  in any form in
respect of any Environmental Authorisation varying, modifying
in any material respect,  revoking,  suspending or cancelling
the same or indicating an intention or  threatening  so to do
and there  are no facts or  circumstances  which  the  Seller
knows or ought  reasonably  to know which will  result in any
Environmental   Authorisation  being  so  varied,   modified,
revoked, suspended or which may prejudice their renewal.

(d) The Seller or the Company has taken all  necessary  action in
connection with the renewal or extension of all Environmental
Authorisations.

(e) The  Company is not  engaged in and,  so far as the Seller is
aware,  there are no facts which make it likely or  desirable
that it should be  engaged  in any  appeal in  respect of any
Environmental   Authorisation  or  any  conditions  contained
therein or any refusal of any Environmental Authorisation.

(f) So far as the Seller is aware or ought to be aware,  there is
no reason  (other than reasons  relating to the  Purchaser or
its   Affiliates)   to  believe   that  those   Environmental
Authorisations which have been applied for but which have not
yet been granted or are pending will not be granted  within a
reasonable  period of time and on terms which are  acceptable
in order for the  Company to continue  its  current  business
operations.

(g) So far as the  Seller  is aware or  ought  to be  aware,  the
execution and/or  performance of this agreement and all other
documents  which are to be  executed at  Completion  will not
result  in any  Environmental  Authorisations  being  varied,
modified, revoked, suspended, cancelled or not renewed, other
than for reasons relating to the Purchaser or its Affiliates.

(2) Compliance with Environmental Laws

(a) The Company is in compliance with  Environmental Laws and the
state  and use of the  Property  have  been at all  times  in
conformity with Environmental Laws.

(b) The Company has not  received any  communication  in any form
from any competent authority requiring the taking of remedial
or other steps in relation to the  pollution or protection of
the  Environment or the state or use of the Property.  So far
as the Seller is aware there are no circumstances which might
give  rise  to such  communications  being  received  and the
Seller is not aware of any  intention on the part of any such
authority to give such notice.

(c) No proceedings or other action, claim or investigation are or
have been in  existence  or are so far as the Seller is aware
pending or threatened  against the Company arising from or in
relation to any  Environmental  Authorisations  or  otherwise
concerning Environmental Laws.

(3) Liability

(a) The Company or the Seller,  in relation to the Business,  has
not received  any notice or  intimation  of any  complaint or
claim from any person in respect of any matter concerning the
Environment.

(b) The Company or the Seller,  in relation to the Business,  are
not and have  not been  engaged  in any  action,  litigation,
arbitration or dispute resolution  proceedings relating to or
concerning   any   actual  or   potential   liability   under
Environmental  Laws and the  Seller  is not aware of any such
matters pending or being  threatened or of any  circumstances
or facts likely to give rise to any such matters.

(c) The Company or the Seller,  in relation to the Business,  are
not and have not been  subject to any  injunction  or similar
remedy or order by a court of competent  jurisdiction,  or to
any  undertakings  given  to such  court  in  respect  of any
matters relating to or concerning the Environment.

(4) As far as the  Seller is aware,  there has not been in  relation  to the
Business  in the last  three  years any  adverse  report,  complaint  or
investigation   under  an  Act  Respecting   Industrial   Accidents  and
Occupational  Diseases  (Quebec) or an Act Respecting  Labour  Standards
(Quebec) or any prosecution, formal caution or warning for any violation
of any applicable laws or regulations.

A.10 DATA ROOM DOCUMENTS

(1)    Save as disclosed in Schedule 7 of the Disclosure  Letter, so far
as the Seller is aware, each licence,  permit, contract, list and
report set out in Annex 6 and  disclosed  in the Data  Room,  and
identified  on Annex 6 by reference to the  reference  number set
out in the Data Room Index annexed to the Disclosure Letter:

(a) other than where redacted, is a true copy of the original;

(b) is the latest version thereof;

(c) is complete; and

(d) has not  been  altered,  amended  or  varied  since  the date
thereon.

(2)    To the extent that any note,  summary or response to questions of
or in respect of the  documents set out in Annex 6 referred to in
sub-Paragraph  A.10(1)  contains any expression of opinion of the
ICI Group (not  including  the  opinion of third  parties),  such
opinion  reflects  the  current  reasonably  held  opinion of its
author  given in good faith  taking into  account the  respective
author's knowledge and understanding.

B. ACCOUNTS

(1) Accounts

(a) The Accounts (true and complete  copies of which are enclosed
with the Disclosure Letter):

(i)have  been  prepared  in  accordance  with the  historical
cost convention and with the Accounting Standards;

(ii) have been  prepared  on bases and  principles  which are
consistent  with  those  used  in the  preparation  of the
audited  statutory  accounts  of the Company for the three
financial years immediately  preceding that which ended on
the Accounting Date; and

(iii)show a true and fair view of the state of affairs of the
Company as at the  Accounting  Date and of the  results of
the Company for the financial year ended on that date;

(b) Without  prejudice to the  generality of paragraph (a) above,
the Accounts make:

(i)adequate provisions or reserve (or note in accordance with
good accountancy  practice) for all actual liabilities and
capital commitments of the Company;

(ii) proper  provision or reserve (or note in accordance with
good  accountancy   practice)  for  all  known  contingent
liabilities    including    unquantified    or    disputed
liabilities;

(iii)provision  or reserve  reasonably  regarded  as adequate
for bad and doubtful debts; and

(iv) provision or reserve for taxation  liable to be assessed
on the  Company  or for  which  it may be  accountable  in
respect of the period ended at the Accounting Date.

(c) True and  complete  copies of the Accounts and of the audited
accounts  for each  financial  year of the Company  preceding
that which ended on the Accounting Date have been laid before
the  Company in general  meeting  and the  auditors'  reports
thereon were unqualified.

(d) The  Accounts   are  not   affected  by  any   extraordinary,
exceptional or non-recurring items.

(e) The   profits  or  losses  of  the   Company  for  the  three
consecutive  financial  years ended on the Accounting Date as
shown by the  Accounts  (and by the  audited  accounts of the
Company for previous periods  delivered to the Purchaser) and
the trend of profits or losses thereby shown have not (except
as therein  disclosed)  been affected by  inconsistencies  of
accounting treatment, by the inclusion of non-recurring items
of  income  or  expenditure,  by  transactions  entered  into
otherwise  than on  normal  commercial  terms or by any other
factors  rendering  such  profits or losses for all or any of
such periods exceptionally high or low.

(f) Since the Accounting Date:

(i)there have been no material  change in any  accounting  or
stock valuation method used by the Company;

(ii) there have been no write downs or similar  reductions to
the book value of any of the Assets of the Company; and

(iii)there  have  been no  upward  revaluations  of  existing
Stocks.

(2) Canadian Financial Information

(a) The Canadian Financial  Information has been derived from the
books of the  Company,  which books have been  regularly  and
consistently   kept  and   maintained   using  ICI's   normal
accounting  policies and  practices as set out or referred to
in the ICI's Controller's Manuals (and the policies contained
in these Manuals are in  accordance  with UK GAAP) as applied
by the relevant  business on a consistent basis in accordance
with UK GAAP and,  on such basis,  represents  the Assets and
liabilities of the Business as at 28 February 1998.

(b) The Canadian  Financial  Information  fairly  represents  the
matters presented therein.

(c) Since 28 February 1998 there has been:

(i)no material  change in accounting  or inventory  valuation
methods  used  by  the  Company  in  connection  with  the
Assets;

(ii) no upward re-valuations of existing Stocks; and

(iii)no material  adverse change in the Business or financial
condition of the Company  which for this purpose shall not
include the  inherently  cyclical  nature of the  titanium
dioxide industry or economic conditions generally.

(3) Since [date of Framework Agreement] 1998:

(i)  the Company has not sold, leased,  transferred,  or assigned
any of its assets, tangible or intangible,  other than for a
fair consideration in the Ordinary Course of Business;

(ii) the Company has not entered  into any  agreement,  contract,
lease,   or  licence  (or  series  of  related   agreements,
contracts,  leases and licences)  either involving more than
US$1,000,000  within  a  12  month  period  or  outside  the
Ordinary Course of Business;

(iii)no party  (including  any of the Company's  Affiliates)  has
accelerated,   terminated,   modified,   or  cancelled   any
agreement, contract, lease, or licence (or series of related
agreements,  contracts, leases, and licences) involving more
than  US$250,000  within a 12  month  period  to  which  the
Company is a party or is bound;

(iv) the Company has not imposed or  permitted  another to impose
any  encumbrance  upon  any  of  its  assets,   tangible  or
intangible  other than those  arising by operation of law or
statutes;

(v)  the Company has not made any capital  expenditure (or series
of related capital  expenditures) either involving more than
US$250,000 or outside the Ordinary Course of Business;

(vi) the Company has not made any capital investment in, any loan
to, or any  acquisition  of the securities or assets of, any
other  person  (or series of  related  capital  investments,
loans  and   acquisitions)   either   involving   more  than
US$250,000 or outside the Ordinary Course of Business;

(vii)other than to Affiliates of the Seller,  the Company has not
issued any note,  bond,  or other debt  security or created,
incurred,   assumed,  or  guaranteed  any  indebtedness  for
borrowed  money  or  capitalised   lease  obligation  either
involving more than US$250,000 singly or US$2,500,000 in the
aggregate;

(viii) the Company has not  delayed or  postponed  the payment of
accounts  payable  and other  liabilities  other than in the
Ordinary Course of Business;

(ix) the  Company  has not  cancelled,  compromised,  waived,  or
released any right or claim (or series of related rights and
claims) either involving more than US$250,000;

(x)  the Company has not granted any licence or sublicence of any
rights under or with respect to any Intellectual Property;

(xi) there  has  been  no  change  made  or   authorised  in  the
constitutional documents of the Company;

(xii)the Company has not issued,  sold, or otherwise  disposed of
any of its capital stock, or granted any options,  warrants,
or other  rights  to  purchase  or  obtain  (including  upon
conversion, exchange, or exercise) any of its capital stock;

(xiii) the  Company  has not  declared,  set  aside,  or paid any
dividend  or  made  any  distribution  with  respect  to its
capital  stock  (whether  in cash or in kind)  or  redeemed,
purchased, or otherwise acquired any of its capital stock;

(xiv)the Company has not experienced any damage,  destruction, or
loss  (whether or not covered by  insurance) to its property
involving sums in excess of US$250,000;

(xv) the Company  has not made or pledged to make any  charitable
contribution outside the Ordinary Course of Business;

(xvi) the Company has not committed to any of the foregoing.

C. ANTI-COMPETITIVE ARRANGEMENTS

(1) The  carrying on of the  Business  by the  Company  does not require any
agreement, arrangement, concerted practice or course of conduct which is
material to the Business and which:

(a) is  subject  to   registration   under  the  Competition  Act
(Canada) but is not so registered;

(b) is an offence or a  reviewable  matter  within the meaning of
Parts  VI and  VIII,  respectively,  of the  Competition  Act
(Canada).

(2) The  Company  or the  Seller,  in  relation  to the  Business,  have not
received in the last three years any process,  notice or  communication,
formal or  informal,  from the  Director of  Investigation  and Research
appointed   under  the   Competition  Act  (Canada)  or  any  anti-trust
regulatory  authority,  relating  to any aspect of the  Business,  which
alleges any illegal  practices in relation to the Business and so far as
the Seller is aware no such process,  notice or  communication is likely
to be received.

D. MATERIAL CONTRACTS

(1) Particulars  of all  Material  Contracts  are annexed to the  Disclosure
Letter.

(2) The Company is not in breach of, or default  under,  any of the Material
Contracts or any other  Contracts the  consequence of which would or may
have a material  adverse effect on the Company and, so far as the Seller
is aware, no state of facts exists or event has occurred,  is pending or
is  threatened  which  after  the  giving of notice or the lapse of time
would or may constitute or result in a breach or a default by the Seller
or by the Company or any other person, firm, corporation or entity of or
in  relation  to any  contract  the  consequences  of which would have a
material effect on the operation of the Business. All Material Contracts
are  legal,  valid  and  binding  obligations  of the  Company  and  are
enforceable in accordance with their terms.

E. EMPLOYEES

(1) Particulars  of the material  terms of  employment  of all Employees and
officers of the Company  are annexed to the  Disclosure  Letter and such
particulars are true, complete and accurate.

(2) No Employee  has given to the  Company and the Company has not  received
from any Employee, nor has the Company given to any Employee,  notice of
termination of any such Employee's employment.

(3) Standard  form  consultancy  agreements,   agency  or  self-employed  or
contracted  labour  agreements  or  contracts  where  sums in  excess of
US$75,000  per annum are paid or are  payable by the  Company  have been
disclosed in the Disclosure Letter.

(4) So far as the Seller is aware, there is no material industrial action by
the Employees  pending or threatened in relation to the Business nor has
there been within the last 12 months.

(5) Particulars  of all loans  made by the  Company to  Employees  and which
shall remain  outstanding at Completion,  together with sums owed by the
Company to any Employee (other than  remuneration and other  contractual
or customary benefits), are disclosed in the Disclosure Letter.

(6) No Employee of Grade 37 or above previously  employed by the Company has
a right to return to work or any right to be reinstated or re-engaged by
the Company, whether under statute or otherwise.

(7) No Employees  previously  employed by the Company have a right to return
to work or any right to be  reinstated  or  re-engaged  by the  Company,
whether under statute or otherwise.

(8) In relation to the  Employees,  there are no existing nor, so far as the
Seller is aware,  threatened  arbitration  procedures  arising out of or
under any union  recognition  or works  council  agreement  covering the
Employees nor, so far as the Seller is aware,  does any basis  therefore
exist  nor has the  Seller  or the  Company  received  any  request  for
recognition  or   representation   by  any  trade  union  not  currently
recognised on the Tracy Site.

(9) The Company has complied in all  material  respects  with all  statutes,
regulations,  orders and codes of conduct  relating  to  employment  and
relations  with  Employees and trade unions and has  maintained  records
required by law regarding the service of each of its Employees.

(10) The  Disclosure  Letter  contains a list of  Employees at the Tracy Site
together with a list of Employees below Grade 37 and a list of Employees
above Grade 37. The Disclosure  Letter also contains a list of Employees
of the Company who are  employed  at  locations  other than at the Tracy
Site.

(11) So far as the Seller is aware here are no material complaints,  disputes
or grievances pending or threatened against the Company of any nature in
relation to its Employees or former Employees.

(12) All of the Employees are employed by the Company.

(13) The Company has discharged  such  obligations to Employees in respect of
salaries, wages, commissions, bonuses, overtime pay and holidays as have
accrued and become payable to Employees in accordance with the Company's
normal policies, including the normal timing of such payments, as at the
date hereof.

For the purposes of this Part E, "GRADE 37" refers to a particular grade
of employee, as determined by the Company,  using the Hay-MSL evaluation
system.

F. PENSIONS

In this Part F, "SCHEME  DOCUMENTS" means the documents  relating to the
Canadian Schemes identified in the Disclosure Letter.

(1) Except  pursuant  to the  Canadian  Schemes,  the  Company has not paid,
provided  or  contributed  towards,  and is  not  under  any  obligation
(whether  or not  legally  enforceable)  to pay,  provide or  contribute
towards any relevant  benefit  payable on death or retirement  for or in
respect of any present or past officer or Employee (or any spouse, child
or dependant of any of them) of the Company.

(2) The Scheme Documents  comprise all the documents  governing the Canadian
Schemes including financial statements for the preceding period of three
years,  all  explanatory  booklets and  announcements  to the  Employees
describing the terms of the Canadian Schemes (other than routine benefit
statements) of current effect and full particulars of any enhancement of
benefit and  contributions  payable to the Canadian Schemes and there is
no obligation  to provide or continue to provide  benefits in respect of
Employees or former  Employees of the Company under the Canadian Schemes
other than as revealed in the Scheme Documents.

(3) The Canadian  Schemes have been registered as required under  applicable
legislation.

(4) The Canadian  Schemes have at all times  complied with the provisions of
all  relevant  statutes,  regulations  and  requirements  and have  been
administered in accordance with the trusts, powers and provisions of the
Canadian  Schemes  and with due regard to the  general  requirements  of
trust law and the advisers to the  Canadian  Schemes have not had and do
not have any cause to report any matter.

(5) The Company has complied in all material  respects with its  obligations
under  the  Canadian  Schemes  and  all  amounts  due to be  paid to the
Canadian Schemes by it and its Employees have been paid.

(6) There are no claims or actions in progress, pending or threatened (other
than routine  claims for benefits)  against the trustees of the Canadian
Schemes or the Company about benefits payable under the Canadian Schemes
in respect of Employees or former Employees of the Company.

(7) All  information  of a factual nature made available to the Purchaser or
its  advisers  in  connection  with  the  Canadian  Schemes  is true and
accurate in all material respects and there is no omission therefrom.

(8) No proposal  has been  announced  to alter or  discontinue  the Canadian
Schemes nor has any proposal which is legally enforceable been announced
to  establish  any   retirement,   death  or  disability   agreement  or
arrangement of the nature  referred to in paragraph (1) above in respect
of  Employees  which  proposal  remains  outstanding  and has  not  been
implemented.

(9) There is no amount which is due to the trustees of the Canadian Schemes.

G. PROPERTIES

(1) The  Property  constitutes  all of the  freehold or  leasehold  or other
immovable  property  currently  owned by the  Company  or in  which  the
Company has an ownership interest.

(2) The  particulars of the Property shown in Schedule 2 are true,  complete
and correct.  The use of the Property for the purpose stated in Schedule
2  corresponds  to the use to  which  it is in fact  put or  (where  the
Property  is not  presently  in use) to the use to  which it was last in
fact put.

(3) The  Company has a good and  marketable  title to the  Property  for the
estate or interest stated in Schedule 2, free from any defects,  and has
in its  possession,  or under its control,  all duly  stamped  deeds and
documents  which are necessary to prove title to the Property,  and such
title has already been fully deduced to the Purchasers.

(4) The  Company  does not require  the use and is not in  occupation  of or
entitled to any estate or  interest  in any land or premises  other than
the Property. The Company is in exclusive occupation of the whole of the
Property and on Completion shall be in exclusive occupation of the whole
of the Property.

(5) The Property is not affected by any of the following matters:

(a) any    servitude,    easement,     reservation,     covenant,
restriction,   agreement,   licence,   franchise,   hypothec,
mortgage, charge, encumbrance, or third party right;

(b) any notice, order, proposal, dispute or complaint relating to
it or its  present  use  under  any  legislation,  agreement,
covenant, condition, licence or consent; or

(c) outgoings (other than uniform  business rates,  water charges
and other  standard  payments to the relevant  water  company
including,  without limitation,  insurance premiums and other
usual business expenses), whether of a periodically recurring
nature  or  otherwise  and  whether  payable  by the owner or
occupier of the relevant property.

(6) All obligations,  restrictions,  conditions and covenants (including any
imposed by or pursuant  to any lease but  excluding  any  referred to in
paragraph  A.9 above)  affecting  the  Property  have been  observed and
performed  so far as the  Seller is aware  and  there are no  subsisting
allegations  of a breach of any thereof  relating to the Property or its
present  use  under any  legislation,  agreement,  covenant,  condition,
licence or consent  other than those  referred to in paragraph A.9 above
or so far as the Seller is aware any circumstance  which might give rise
to such a breach.

(7) The Property is in a good and substantial  state of repair and condition
and fit for the  purposes  for  which  they are  presently  used and the
Company has not used in the Property any  substances  not in  conformity
with  relevant  standards  or codes of practice  or which are  generally
known  to  be  deleterious  to  health  and  safety  and  there  are  no
uncompleted  works of any description at the Property other than routine
maintenance.

(8) There are no subsisting allegations that the use of the Property for the
purpose  stated  in  Schedule  2 is not  the  permitted  use  under  the
provisions of all relevant legislation.

(9) The Company has no liabilities or contingent  liabilities (but excluding
any  matters  referred  to in  paragraph  A.9  above) in  respect of any
properties  (other than the Property) (or any interest  therein) whether
by privity of contract or by way of guarantee or surety or otherwise.

(10) The Property has the benefit of all rights,  servitudes,  easements  and
consents  required for the  occupation and operation of the Property for
their present use and any plant,  machinery  and  processes  thereat and
such  rights,  servitudes,  easements  and consents are enjoyed on terms
which do not  permit  them to be  determined  by any  third  party or by
effluxion of time.

(11) There are no  outstanding  liabilities  to make  payments  in respect of
rates,  water  charges,  or any other charges  payable in respect of the
Property  to  any  governmental,   state,  municipal  or  other  similar
authority.

H. INTELLECTUAL PROPERTY

(1) The rights licensed to the Company  pursuant to the Canadian  Technology
Agreements  in  combination  with all  rights  owned by the  Company  in
Intellectual   Property   constitutes  all  the  Intellectual   Property
necessary for the conduct of the Business by the Company as now
conducted.

(2) The Seller does not have actual notice of  infringement  by others or of
attacks on the validity or  enforceability  of or on the Company's title
to  any  Material  Intellectual  Property  used  in  the  Business.  The
Disclosure   Letter   identifies  all  patents,   patent   applications,
registrations   and   applications   for  registration  of  Intellectual
Property,  all Material  unregistered  trademarks,  service marks, trade
names and copyrights  owned by the Company.  "MATERIAL" in this Warranty
H(2) means  Intellectual  Property  the  absence  of which  would have a
significant negative impact on either (a) the revenue attributable to or
derived from the  Intellectual  Property or (b) otherwise on the conduct
of the Company's  business.  The Disclosure  Letter also  identifies the
status  of the  relevant  patents  and,  so far as the  Seller is aware,
whether or not such patents are currently being opposed.

(3) The Disclosure Letter identifies all information  technology used by the
Company  which is defined in the  Disclosure  Letter as being  "MATERIAL
INFORMATION TECHNOLOGY".

(4) The Seller does not have actual  knowledge and has not received  written
notification   that  the   activities  of  the  Business   infringe  the
Intellectual   Property  of  any  third  party  (the  Seller  having  no
obligation to conduct  investigations  in relation to any such potential
infringement).

(5) So far as the  Seller  is  aware  or ought  to be  aware,  all  Material
agreements relating to Intellectual  Property and Technical  Information
to which the  Seller is a party and  which  relate to the  Business  are
listed in the Disclosure Letter.  "MATERIAL" in this Warranty H(5) means
agreements relating to Intellectual  Property the absence of which would
have  a   significant   negative   impact  on  either  (a)  the  revenue
attributable  to or  derived  from  the  Intellectual  Property  or  (b)
otherwise on the conduct of the Company's business.

(6) All  Intellectual  Property  material  to the  conduct  of the  Business
immediately  prior to  Completion  will be owned or available for use by
the  Company  immediately  after  Completion.  For the  purposes of this
Warranty H(5), Material has the same meaning as in Warranty H(2).

I. BROKERS

Neither the Seller nor the Company has employed any  investment  banker,
broker or finder or  incurred  any  liability  for any  brokerage  fees,
commissions,  finders fees or similar  payments in  connection  with the
transactions contemplated by this agreement for which the Purchaser, the
Purchaser's Affiliates or the Company may be liable.

J. TAXATION

(1) Tax Returns, disputes, records and claims etc.

(a) The Company has made all proper  returns  required to be made
for any  Taxation  purpose  and has  supplied or caused to be
supplied  all  information  required by law to be supplied to
any revenue authority.

(b) There is no dispute or  disagreement  (not including  routine
queries  relating  to the  Taxation  returns of the  Company)
outstanding  at the date of this  Agreement  with any revenue
authority  regarding  the  proper  method  of  computing  the
profits  of the  Company  (or any  part  of it) for  Taxation
purposes  or the  proper  treatment  of sales  and  goods and
services  tax of any  supplies of goods or services  made (or
treated  as made) by the  Company  or in respect of any other
Taxation matter and there are no  circumstances  of which the
Seller is aware which make it likely that any such dispute or
disagreement   will  commence.   Without   prejudice  to  the
generality   of   the   foregoing,   there   is  no   current
investigation being undertaken by any Taxation authority and,
so  far  as the  Seller  is  aware,  there  are  no  existing
circumstances  which make it likely,  in the event of such an
investigation taking place, that a liability will arise.

(c) The amount of Taxation  chargeable on the Company  during any
accounting  period  ending  on or  within  six  years  before
Completion  has not to any  material  extent  depended on any
concession,   agreement,   dispensation   or   other   formal
arrangement with any revenue authority in circumstances where
either:

(i) the   availability  of  any  such   arrangement  will  be
prejudiced  as a result of the  change of  control of the
Company resulting from this agreement; or

(ii)the  Company has not acted in  accordance  with the terms
of the arrangement in question.

(d) The Company has made all  Taxation  claims,  disclaimers  and
elections  and taken all other  action the making or doing of
which was  assumed  to have been made for the  purpose of the
Taxation provisions in the Accounts.

(2) Duties etc.

All customs duties and sales and goods and services taxes payable to any
revenue  authority upon the  importation of any of the Company's  assets
and all excise duties payable to any revenue authority in respect of any
of these  assets  have  been paid in full,  and none of these  assets is
liable to confiscation  or forfeiture  (whether by virtue of non-payment
or underpayment  of any Taxation or duty or by virtue of  non-compliance
with any  legislation or regulation  relating to any Taxation or duty or
otherwise howsoever).

(3) Stamp Duty

All documents  which are in the possession or control of the Company and
which are  subject to stamp duty or  similar  duty and which  confer any
right  upon the  Company  have been duly  stamped  and all stamp duty or
similar duty properly paid thereon.  The Company has never  incurred any
liability to stamp duty reserve tax.

(4) Contracts

No  contracts to which the Company is a party and no  obligation  to any
present  or former  director,  employee  or officer  involve  any future
liabilities  of a  revenue  nature  which  when  incurred  will  not  be
deductible in computing  profits for corporation tax purposes  otherwise
than as a result of any future  changes in the law or as a result of any
voluntary  act  after  Completion  of the  Purchaser  or of the  Company
outside the Ordinary Course of Business of the Company.

(5) Distributions and payments

The Company has  deducted and  properly  operated  and  accounted to the
appropriate  revenue authority for all amounts which it has been obliged
to deduct in respect of Taxation.

(6) Employee benefits

(a) The Company has made all required deductions and withholdings
from all payments made, or treated as made, to its directors,
Employees  or  officers  or former  directors,  Employees  or
officers or any person  required  to be treated as such,  and
accounting  to the taxation  authorities  for all Taxation so
deducted  and for all Taxation  chargeable  on the Company on
benefits  provided for its directors,  Employees or officers,
or former directors, Employees or officers.

(b) The  Disclosure  Letter  contains  full  details of all share
incentive schemes,  profit sharing schemes and profit related
pay schemes established by the Company.

(7) Residence and offshore interests

(a) The  Company is and has at all times been  resident in Canada
for the purposes of all Taxation  Statutes and has not at any
time been  resident  outside  Canada for the  purposes of any
Taxation Statute or any double taxation arrangements.

(b) The Company has not at any time had a branch  outside  Canada
or any permanent establishment (as that expression is defined
in any applicable  double taxation  treaties)  outside Canada
and  the  Company  has no  existing  entitlement  to  receive
royalties,  (or any sum treated as royalties for any Taxation
purposes)  which are paid  subject to  deduction  of Tax in a
jurisdiction outside Canada.

K. MILLENNIUM COMPLIANCE

(1) For the purposes of this agreement "MILLENNIUM COMPLIANT" means that the
Computer Systems are capable of the following  functions before,  during
and/or after 1 January 2000:-

(a) handling date information involving all and any dates before,
during and/or after 1 January 2000  including  accepting date
input, providing date output and performing date calculations
in whole or part;

(b) operating  accurately without  interruption on and in respect
of any and all dates  before,  during  and/or after 1 January
2000 and without any change in performance;

(c) responding  to and  processing  two digit year input  without
creating any ambiguity as to the century; and

(d) storing and providing date input information without creating
any ambiguity as to the century.

(2) The Disclosure  Letter  contains  material  details of the measures that
have been  implemented  within the Business to  determine  the extent to
which its Computer  Systems are not Millennium  Compliant,  and material
details of any  programme  undertaken by the Business with a view to its
Computer  Systems  achieving  Millennium  Compliance  (or  so  close  to
Millennium Compliance as is practicable).

L. INTRA-GROUP ARRANGEMENTS

(1) There is no  indebtedness  or liability  (actual or contingent)  nor any
security  owed by the  Company  to any member of the  Seller's  Group or
ICI's Group (as constituted  following Completion) other than arising in
the Ordinary Course of Business and as conducted on arm's length terms.

(2) There is no agreement or contract to which the Company is a party and to
which  any  member  of the  Seller's  Group  (as  constituted  following
Completion)  is a  party  or in  which  any  such  member  is  otherwise
interested  in any  way  whatsoever  which  shall  continue  beyond  the
Completion Date.

M. DEBTORS

(1) The Company has not made,  or entered  into any contract or agreement to
make any loan to, or other  arrangement  with, any person as a result of
which it is or may be owed any money other than trade debts  incurred in
the Ordinary Course of Business and cash at bank.

(2) The Company is not entitled to the benefit of any debt otherwise than as
the original  creditor and has not  factored or  discounted  any debt or
agreed to do so.

(3) All of the  debts  which  will  be  reflected  in the  Final  Completion
Statement as owing to the Company  (apart from bad and doubtful debts to
the extent to which they have been provided for in the Final  Completion
Statement  (as defined in Schedule 6)) will realise  their full value as
included in the Final  Completion  Statement  within the  payment  terms
agreed with the respective creditors.

N. OTHER OPERATIONS AND ASSETS

(1) During the 8 years prior to the date hereof,  neither the  Company,  nor
any of its downstream Affiliates nor any entity to which the Company has
succeeded  through merger or by operation of law, has engaged,  directly
or  through  downstream  Affiliates  or agents or in  partnership,  in a
business  other  than  the  manufacture,   import,   export,   sale  and
distribution of titanium pigments, co-products and related products.

(2) The Seller has disclosed to the  Purchaser  details of all real property
owned,  leased  or  occupied  by the  Company  or any of its  downstream
Affiliates  or any entity to which the  Company  has  succeeded  through
merger or by  operation  of law at any time  during the 8 years prior to
the date hereof.

(3) The  Seller  has  disclosed  to  the  Purchaser  all  off-site  disposal
locations of Hazardous  Materials  owned by the Company,  its downstream
Affiliates  and any entity to which the  Company has  succeeded  through
merger  or by  operation  of law  during  the 8 years  prior to the date
hereof.

(4) Neither the Company, nor any of its downstream Affiliates nor any entity
to which the Company has succeeded through merger or by operation of law
has owned or  controlled  a business for whose  liabilities  any of them
could be  responsible  the business  records of which have not been made
available in the Data Room.

SCHEDULE 4
IMPLEMENTATION AGREEMENTS

1 Deed of Indemnity.

SCHEDULE 5
ENVIRONMENT

1 INTERPRETATION

For the purposes of this Schedule,  words and expressions defined in the
Share Sale  Agreement to which this Schedule is attached  shall have the
same  respective  meanings  in  this  Schedule  and,  in  addition,  the
following terms shall have the following respective meanings:

"COMMERCIALLY  REASONABLE EXPENSES" are those costs and expenses which a
reasonable person acting in a commercially  prudent manner,  taking into
account  (but  without  imposing  an absolute  requirement)  the need to
minimise his expenditure, would expend, in the case of any obligation to
carry out the  remediation of  Environmental  Contamination  pursuant to
Environmental Laws, to meet that obligation. For the avoidance of doubt,
Commercially Reasonable Expenses shall not include any costs or expenses
to the extent  that they are  incurred  as a result of the  adoption  or
imposition of standards of clean-up materially more stringent than those
which are provided for under Environmental Laws;

"CONTROLLED  WATERS"  means  waters  including  any  ground  or  surface
waters;

"COUNTER  INDEMNITY" means the indemnity  defined in  sub-paragraph  3.1
of this Schedule;

"ENVIRONMENT"  means air,  Controlled  Waters,  land  (whether on, in or
below such land,  excluding any buildings or other permanent  structures
on, in or below the land) but  including  the  surface of any river bed,
the surface of any sea bed or any other land covered by water, and flora
and fauna and all other natural resources;

"ENVIRONMENTAL CONTAMINATION" means any discharge,  transport, emission,
release, leakage,  spillage, escape or disposal of Hazardous Material at
or from the Site(s) onto or into any part of the Environment;

"ENVIRONMENTAL  LAWS"  means  any and all  legislation  (whether  civil,
criminal or administrative),  statutes,  treaty,  statutory  instrument,
directive, bylaw or judgment, regulations,  ordinances, notices, orders,
government  circulars,  codes of practice,  policy and guidance notes or
decisions  of any  competent  regulatory  body or common law relating to
pollution  or  protection  of the  Environment  or harm to human  health
arising from Environmental Contamination,  which as at Completion are in
effect  and  legally  capable  of  enforcement  by legal  process in the
country in which the Site(s) are situated;

"ENVIRONMENTAL  LIABILITIES" means all claims, costs, damages,  expenses
(including reasonable professional fees incurred),  losses,  liabilities
(including  without  limitation  liability to third  parties),  fines or
penalties  suffered or incurred by the  Company,  the  Purchaser  or its
Affiliates  (or the Seller or its  Affiliates in the case of the Counter
Indemnity)  in  relation to the  Company  (excluding  in the case of the
Indemnity but not the Counter  Indemnity the LPC Interests and LPC) as a
direct   consequence  of  or  in  connection   with  any   Environmental
Proceeding;

BUT EXCLUDING any claims, costs, damages, expenses, losses, liabilities:

(i) in  respect  of capital  expenditure  on plant and  equipment
other than capital to carry out remediation of  Environmental
Contamination pursuant to Environmental Laws;

(ii)in respect of loss of anticipated  profits,  loss of revenue,
or any other loss in respect of business  interruption  other
than such reasonably  foreseeable losses of third parties who
have themselves directly suffered the relevant  Environmental
Contamination  or  whose  use of  the  Environment  has  been
adversely and directly affected by the relevant Environmental
Contamination;

(iii)  where   applicable   to  the  extent  that  they  are  not
Commercially Reasonable Expenses;

"ENVIRONMENTAL PROCEEDING" means in relation to the Company:

(i) subject  to (ii)  and  (iii)  below,  any one or more  writs,
interim  or  final   judicial  or   administrative   decrees,
judgments, injunctions, orders, or notices:

(a)under which the Company,  the Purchaser or its  Affiliates
(or  the  Seller  or its  Affiliates  in the  case  of the
Counter  Indemnity) are obliged by  Environmental  Laws or
legal process pursuant to Environmental  Laws to undertake
or pay the cost of remediation or with which the aforesaid
parties are otherwise obliged to comply; or

(b)in  respect  of any  violation  or  alleged  violation  of
Environmental Laws; or

(c)in respect of:

(01)    any personal injury to any third party; or

(02)    damage to any property of any third party,

both pursuant to Environmental Laws;

Provided that in the case of the Indemnity only:

*  the  reference  to the Company  shall  exclude the LPC
Interests and LPC; and

*  in paragraphs  (i) (c) (01) and (02), the reference to
a  "THIRD  PARTY"  shall  not  include  any  employee,
contractor  or agent of the Company,  the Purchaser or
its Affiliates, except when:

-  the  personal   injury  other  than   asbestos-related
personal  injury  (in the  case of  paragraph  (i) (c)
(01)); and/or

-  the damage to property (in the case of (i) (c) (02)),

occurs after Completion and the Purchaser did not know
or   reasonably   ought  not  to  have  known  of  the
circumstances which gave rise to that personal injury,
or as the case may be, that damage; and

(ii)any  agreement  between the Seller and  Purchaser  (or in the
event of disagreement any  determination by the Experts) that
it  is  Reasonably  Necessary  to  undertake  remediation  of
Environmental  Contamination,  which  would (but for the fact
that an  environmental  authority  is  unaware of it) be more
likely  than  not to  result  in an  environmental  authority
bringing  an  Environmental  Proceeding  under  (i)(a) in the
definition of Environmental Proceeding and which would result
in Environmental Liabilities;

(iii) notwithstanding  sub-paragraph 4.1 hereafter, any agreement
by the  Purchaser  or its  Affiliates  with an  environmental
authority that the Purchaser or its Affiliates will undertake
remediation   of   Environmental    Contamination   if   such
remediation is required by such environmental  authority as a
condition  to the  granting,  surrender  or  variation  of an
Environmental  Authorisation  relating to the Site,  provided
that:

(a)the grant,  surrender or  variation  of the  Environmental
Authorisation  arises out of the  conduct of the  Business
by the Purchaser or its Affiliates; and

(b)the subject matter of the agreement with the environmental
authority  shall relate to the Site  Provided  that if the
subject  matter of the  agreement  does not  relate to the
Site, the Purchaser shall have taken all such steps as may
be  reasonable  to  contest  the  relevant   environmental
authorities linkage of the subject matter of the agreement
to the Site; and

(c)the  remediation  is not required  because of any proposed
change  of  use of  the  Site  from  the  Business  of the
Company; and

(d)save in respect of  sub-paragraph  4.1.2  relating  to any
Site or part  thereof,  the  remediation  is not  required
because  of any  proposed  closure  of all or  part of the
Site, other than in relation to:

(I) any  material  change of process  within the  existing
plant and/or buildings on such Site; or

(II)any material  change to or development of the business
and/or  operations  carried  on at the Site which does
not  result in such Site (or any part)  ceasing  to be
used for  general  industrial/manufacturing  of a type
materially similar to the existing Site operation; and

(e)the  Purchaser  or  its   Affiliates  has  to  the  extent
practicable consulted in good faith with the Seller on the
agreement   or   arrangements   with   the   environmental
authority.

"HAZARDOUS MATERIAL" means hazardous,  poisonous,  dangerous, noxious or
toxic substances, pollutants or wastes including (to the extent they are
hazardous,   poisonous,   dangerous,   noxious  or  toxic)   pesticides,
contaminants,  petroleum products,  asbestos,  polychlorinated biphenyls
and radiation;

"INDEMNITY" means the indemnities contained in paragraph 2 below;

"REASONABLY  NECESSARY" means reasonably  necessary to avoid or avert or
mitigate the development of substantial  adverse and material  pollution
of the  Environment  or harm to human  health  which will arise within a
period of six months; and

"SITES(S)" means the Properties.

2 INDEMNITY

2.1 Subject to the provisions of this  agreement,  the Seller  undertakes to
the Purchaser (for the benefit of the Company, the Purchaser and each of
its  Affiliates)  that it will  indemnify and hold harmless the Company,
the Purchaser and each of the Purchaser's  Affiliates against:

2.1.1  all Environmental  Liabilities arising at or from the Site(s), to
the extent that such  Environmental  Liabilities  are a result of
Environmental  Contamination  occurring on or before  Completion;
and

2.1.2  save  in  respect  of the  LPC  Interests  and  LPC,  all  costs,
damages,   expenses,  losses,  fines  or  penalties  suffered  or
incurred by the Company or the  Purchaser or its  Affiliates as a
result of any  prosecutions  commenced or proceedings  taken,  or
notices served or other formal  enforcement  action between [DATE
OF SIGNATURE OF FRAMEWORK  AGREEMENT]  1998 and Completion by any
competent  regulatory  body in connection with the Environment or
health   and  safety  as  a  result  of  any   breaches   of  any
Environmental  Laws  related  to the  operation  of  those  Sites
which are  owned,  occupied  or used by the  Company  at [DATE OF
SIGNATURE  OF  FRAMEWORK   AGREEMENT]  1998.  "DAMAGES"  in  this
paragraph  2.1.2  includes  any  capital  expenditure  reasonably
required to remedy such breaches; and

2.2 notwithstanding  sub-paragraphs  2.1 above and 4.1  below,  neither  the
Seller nor any of its Affiliates  shall be liable under the Indemnity or
otherwise  to  the  extent  that  such  liability   arises  from  or  is
attributable  to the failure of the  Purchaser  to comply or procure the
Company's compliance with the provisions of paragraphs 4.2, 6.1, 6.2, 7,
8, 9, 10, 12 and 14 of this Schedule.

3 THE COUNTER INDEMNITY

3.1 The  Purchaser  undertakes  to the Seller (for the benefit of the Seller
and each of its  Affiliates)  that,  subject to the  provisions  of this
agreement, it will indemnify and hold harmless (the "COUNTER Indemnity")
the  Seller  and  each  of  its  Affiliates  against  all  Environmental
Liabilities  arising  at or from the  Site(s)  to the  extent  that such
Environmental Liabilities are as a result of Environmental Contamination
after Completion.

3.2 Notwithstanding   sub-paragraph   3.1  above,   the  Purchaser  and  its
Affiliates shall not be liable to the Seller under the Counter Indemnity
or  otherwise  to the  extent  that  such  liability  arises  from or is
attributable  to the failure of the Seller to comply with the provisions
of  paragraphs  3.3,  4.2,  6.1,  6.2,  7, 8, 9,  10,  12 and 14 of this
Schedule.

3.3 The Seller  shall take all  reasonable  steps to avoid or  mitigate  any
Environmental  Liabilities and potential Environmental Liabilities which
may give rise to a claim under or in connection with this
Counter Indemnity, howsoever arising.

3.4 The  provisions  of  sub-paragraphs  4.2 and 12.1  shall  apply  equally
mutatis mutandis in respect of the Seller and the Purchaser's  rights or
obligations in respect of the Counter Indemnity.

4 LIMITATIONS

4.1.1  Neither  the  Seller  nor any of its  Affiliates  shall be liable
under   the   Indemnity   to  the   extent   that   Environmental
Liabilities have arisen,  been increased,  exacerbated,  enhanced
or caused as a result of any act or omission  (whether  direct or
indirect)  of the  Company,  the  Purchaser  or  any  Affiliates,
employees,   agents  or  contractors   thereof  after  Completion
(including,   without  limitation,  any  change  of  use  of  the
Site(s)  including  closure  of all or any part of the  Sites but
not  including  any  material   change  of  process   within  the
existing  plant and/or  buildings  or any  material  change to or
development  of the  business  and  operations  carried on at any
Site  which  does not  result in any Site or any part of any Site
ceasing  to be used  for  general  industrial/manufacturing  of a
type materially similar to the existing Site operation.

4.1.2  In connection with any Site or part thereof, the use of which had
substantially   ceased  prior  to  Completion,   nothing  in  the
provisions  of  paragraph  4.1.1  shall  apply  to  Environmental
Liabilities  resulting from the  Purchaser's  or its  Affiliates'
change of activities or demolition or closure thereon, save:

(i) where  this  was  done  other  than  in  the  conduct  of the
Business by the Purchaser or its Affiliates; and

(ii)so  long  as  and  to  the  extent  that  the   Environmental
Liabilities   have   not   otherwise   been   so   increased,
exacerbated,  enhanced  or caused as a result of any such act
or omission as aforesaid.

4.1.3  The word  "OMISSION"  as used in this  paragraph  4.1  shall  not
mean any  failure  by the  Company  or  Purchaser  to  carry  out
remediation or preventative  action in circumstances  where it is
not within  their  power to do so or where the  Purchaser  is not
aware  or  could  not   reasonably   have   been   aware  of  the
Environmental   Liabilities   in  question   or  where   (without
prejudice to the  obligations  of the Purchaser  under  paragraph
5) the  rights  of the  Purchaser  to  bring  a claim  under  the
Indemnity would be prejudiced as a result thereof.

4.2 No  claim  may be  made  for any  Environmental  Liabilities  under  the
Indemnity  or Counter  Indemnity  to the extent  that any  Environmental
Liabilities arise:

4.2.1  as a result  directly or  indirectly of  information  voluntarily
given,  in the  case of the  Indemnity  by the  Purchaser  or the
Company  (but only post  Completion  in the case of the  Company)
or, in the case of the  Counter  Indemnity,  by the Seller  after
Completion  to a  regulatory  authority  in  circumstances  other
than  where  there is a  mandatory  reporting  requirement  under
Environmental  Laws or where  information is given as required in
the   context   of    applications    for   or    variations   to
authorisations,   licences  and  other  forms  of   environmental
consent  required by the Business in the course of the  Company's
or the  Purchaser's or Seller's  normal  business  activities (as
appropriate)  or where the other  party has  previously  proposed
or approved this course of action in writing; and

4.2.2  save where compelled by law, from any admission of liability by a
representative of the Purchaser or Seller holding a rank not less
than that of Senior  Vice  President  in respect of any  clean-up
which needs to be done, except where the other party has approved
such  admission in writing such  approval not to be  unreasonably
withheld or delayed.

4.3 No claim under the terms of the  Indemnity or Counter  Indemnity for any
Environmental  Liabilities  shall be valid unless notice has been served
in  accordance  with the  provisions  of  paragraph 7 and in the case of
Indemnity,  but not the Counter  Indemnity,  said notice has been served
within 10 years of Completion.

4.4 The  Seller's   liability  under  the  Indemnity  shall  be  limited  in
accordance  with the  provisions  of the Americas  Liability  Agreement,
except for  sub-clauses  4.1.2 (save for the proviso to sub-clause  4.1)
and 4.2 of the Americas Liability Agreement, the subject matter of which
will be governed by the provisions of this Schedule.

4.5 In the event that the  Indemnitor  (as defined in paragraph  6.1) either
incurs external charges,  costs and expenses for environmental  services
or internal charges for its own environmental  services,  in either case
including but not limited to testing and/or  analytical  services and/or
contaminated soil disposal facilities, in connection with or in relation
to any actual or potential Environmental Liabilities under the Indemnity
or Counter  Indemnity (as  appropriate)  then such external and internal
charges,  costs and expenses  shall be deemed to be payments  made under
the  Indemnity  or Counter  Indemnity  (as  appropriate).  Any  internal
charges shall be made on the same basis as the Indemnitor charges to its
own business or its Affiliates.

4.6 It is hereby  expressly  agreed that, save where the Seller has accepted
liability or becomes  otherwise liable under the terms of the Indemnity,
all costs  incurred  by the  Purchaser  in  carrying  out  environmental
analyses and tests of the Site(s) (and its (or their)  surrounds)  shall
be borne by the  Purchaser,  other  than  costs in the  exercise  of the
rights and  powers  given to the  Seller by  sub-paragraphs  9.1 and 9.2
which shall be borne by the Seller unless the Purchaser  becomes  liable
therefor under the terms of the Counter  Indemnity or unless the parties
otherwise agree.

4.7 The Seller shall be liable under the Indemnity for any  asbestos-related
personal  injury  unless and to the extent that any works carried out by
the Purchaser or its  Affiliates or the Company after  Completion,  were
not carried out by a reputable contractor or contractors,  who were duly
and properly  authorised or approved to undertake such works to at least
the standards of the relevant  federal,  provincial or other  regulatory
authorities  published  by or in  operation  (in  accordance  with  good
industry practice) at all times during the carrying out of such works.

5 MITIGATION

The  Seller and the  Purchaser  shall take all  reasonable  steps  after
Completion  to avoid or mitigate any  Environmental  Liabilities  and/or
potential  Environmental  Liabilities  to the  extent  it is  reasonably
within their respective  powers to do so, which may give rise to a claim
under or in  connection  with this  Indemnity or Counter  Indemnity,  as
appropriate, howsoever arising. Such steps will include but shall not be
limited to:

5.1 in  the  case  of  the   Purchaser,   carrying  out  (where   reasonably
practicable)  appropriate  soil tests before  taking any action which is
likely to cause a material disturbance to soil;

5.2 in the case of the Purchaser,  where reasonably  practicable carrying on
its  activities  on the Site(s) so as to minimise  disturbance  to known
areas of existing or probable soil contamination  (other than deliberate
removal of such contaminated soil) without incurring abnormal unusual or
excessive cost in so doing;

5.3 where  relevant,  (with  the  approval  of  the  other  party  not to be
unreasonably  withheld  or  delayed)  settling a claim of any party (not
being an Affiliate of the  Purchaser in the case of the  Indemnity or of
the Seller in the case of the Counter  Indemnity) which will or may fall
within the terms of the Indemnity or Counter Indemnity,  as appropriate,
the costs and expenses  associated  with such settlement (so approved by
the other party) being deemed to be  Environmental  Liabilities  for the
purposes  of  this  agreement,  provided  always  that  nothing  in this
sub-paragraph 5.3 shall oblige the Purchaser or the Seller to enter into
any settlement which it does not, in its sole discretion, consider to be
in the best interests of its operations;

5.4 making  reasonable and timely efforts to pursue claims against any third
parties  (including  insurers) who may have some liability in respect of
the matter in  question  under the  Indemnity  or Counter  Indemnity  as
appropriate  provided  always  that this shall not limit or  restrict or
operate  in any way as a  pre-condition  to the  rights  to make a claim
under this Indemnity or Counter Indemnity, as appropriate; and

5.5 in the case of the Purchaser,  using reasonable endeavours to avoid acts
or  omissions  of the  nature  described  in  sub-paragraph  4.1 of this
Schedule.

6 NOTIFICATION

6.1 As soon as  reasonably  practicable  after either party becomes aware of
any actual or potential Environmental Liabilities which may give rise to
a claim by it under the Indemnity or Counter  Indemnity (the "CLAIMANT")
(whether or not the Claimant is of the opinion that it has a valid claim
against the other party under the  Indemnity or Counter  Indemnity  (the
"INDEMNITOR")),  the Claimant  shall give written  notice thereof to the
Indemnitor (and  thereafter will use all reasonable  efforts to keep the
Indemnitor  reasonably  informed of all material  developments  relating
thereto).  Such written notice shall include  reasonable  details of all
relevant  matters  relating  to any  actual or  potential  Environmental
Liabilities.   Thereafter,   the  Claimant  will  promptly   advise  the
Indemnitor orally of the Claimant's reasonable estimate of the extent of
and,  where  reasonably  practicable,  the  cost of  remediation  of the
Environmental  Liabilities,  as a  result  thereof),  provided  that the
Indemnitor  shall have given the Claimant  written notice of the name of
its representative to whom such oral communication shall be imparted.

6.2 Neither  party shall admit,  settle or discharge  any claim or liability
which might  constitute a claim against the other under the Indemnity or
Counter Indemnity (as appropriate)  without having first served a notice
under this  paragraph 6 and given the other a reasonable  opportunity to
consider the circumstances referred to in the said notice.

7 CLAIMS

In the  event  that the  Claimant  wishes  to make a claim  against  the
Indemnitor  under the Indemnity or Counter  Indemnity  (as  appropriate)
then it shall  do so by  giving  notice  in  writing  of the same to the
Indemnitor  giving  such  details as are then in its  possession  of the
relevant subject matter of such claim.

8 CONDUCT

If any notice is received by either  party under  paragraphs 6 or 7, the
Claimant shall, if so requested by the Indemnitor,  take all steps which
are necessary and  reasonable to avoid,  resist,  appeal,  compromise or
defend any claim and any adjudication in respect thereof (subject to the
Claimant  being  indemnified  against  all cost and  expenses  which may
reasonably and necessarily be incurred in connection therewith), and the
Indemnitor shall (subject to the provisions of this  paragraph),  at its
request, be allowed to conduct any negotiations,  proceedings or appeals
incidental  thereto  PROVIDED  ALWAYS  that if the claim  relates  to or
arises  from a Site which at the time is owned,  occupied or used by the
Company  and  which  is  operational  at the  date of the  notice  under
paragraph 7 then the Purchaser  shall have conduct of all  negotiations,
proceedings or appeals incidental thereto but shall nonetheless keep the
Seller  fully  informed  of all  material  developments  relating to the
subject matter of the claims.

9 SITE ACCESS

If any notice is received by the Seller under paragraphs 6 or 7:

9.1 the  Seller  and/or its  agents  and  contractors  shall be free to have
access  to any  Site(s)  to the  extent  it is  within  the power of the
Company, the Purchaser or its Affiliates,  during normal business hours,
and after reasonable prior notice, and, if so required by the Purchaser,
in the presence of authorised representatives of the Purchaser to assess
(including  but not limited to  assessment by soil sampling and testing)
the   extent  of  the   Environmental   Liabilities   and/or   potential
Environmental  Liabilities and to determine the action required in order
to remediate such  liabilities  (such actions to be subject to the prior
agreement of the Purchaser (including as to the action to be taken) such
agreement not to be unreasonably withheld); and

9.2 the Purchaser  shall (during normal  business hours) allow the Seller or
its agents  access to inspect  and take copies of such books and records
of the  business of the  Company  and/or the  Purchaser  relating to the
Site(s)  as  may be  necessary  in  connection  with  any  Environmental
Liabilities and/or potential Environmental Liabilities.

9.3 The Seller shall exercise  proper care in the exercise of its powers and
rights  pursuant to this  paragraph 9 and shall  indemnify the Purchaser
for all  reasonably  incurred  losses or  liabilities  arising  from the
Seller's failure to do so.

10 DISCUSSIONS

Upon either party having given a notice under  paragraphs 6 or 7, either
the Seller or the Purchaser may request a meeting as soon as practicable
to  discuss  the matter  (and if either  does so the other  party  shall
comply  promptly with such request) and,  irrespective  of whether there
has been any agreement on liability,  each party shall be fully involved
but (save as  otherwise  agreed  between the parties) not as to make any
admission or liability  not  permitted by the other  provisions  of this
Schedule in any discussions and/or  negotiations with any party imposing
or seeking to impose any Environmental Liabilities.

11 DISPUTE RESOLUTION

Upon either party giving a notice in accordance with paragraph 7, in the
event  that the Seller and the  Purchaser  are unable to agree  promptly
upon any factual  matter  relevant to a claim  under this  Indemnity  or
Counter  Indemnity (as  appropriate) or in the event of any other matter
being referred to the Experts in accordance  with this Schedule then the
following provisions of this paragraph 11 shall apply:

11.1 a reputable  independent  firm of experts (the "EXPERTS") (who shall act
as experts and not arbitrators) in relation to the Environment  relevant
to the claim or  potential  claim  (having  at least ten years  relevant
experience) shall be appointed by mutual agreement of the parties hereto
(and the  parties  shall each be obliged  to use their  respective  best
endeavours  to reach  agreement as soon as  practicable)  to resolve any
factual  matter in dispute  between the parties  but not  including  any
interpretation  of laws or  regulations  as they  apply to such  factual
matters or any conclusions regarding  responsibility or liability for or
in  relation to any factual  matters.  The Experts  shall be offered the
appointment  within 15 Business Days of the parties reaching such mutual
agreement  and  shall  be  notified  in  writing  of the  provisions  of
sub-paragraph   11.7  below.   Failing  such  mutual  agreement  on  the
appointment of Experts,  the parties shall promptly refer the issue,  at
their  joint  cost,  to the  President  for the time  being of the Royal
Institute of Chartered Surveyors in the United Kingdom with instructions
to  appoint   suitable  Experts  within  14  days  of  receipt  of  such
instructions;

11.2 the said Experts shall only be dismissed by the mutual  agreement of the
parties hereto;

11.3 both parties shall promptly and simultaneously  exchange with each other
and  submit  to the  Experts,  and in any event in  accordance  with the
Experts'  written   directions,   their  arguments  and  submissions  in
connection  with any matter of fact referred to them in accordance  with
this paragraph 11;

11.4 following  receipt by the  Experts of the  written  arguments  and other
submissions of the parties pursuant to paragraph 11.3, the parties shall
instruct  the Experts to issue,  as soon as  reasonably  practicable,  a
formal  written  opinion  pertaining  to the matter of fact  referred to
them. In any event,  the Experts shall be instructed to present the said
opinion  within two months after  receiving  the written  arguments  and
other submissions of the parties pursuant to sub-paragraph 11.3;

11.5 the  formal  written   opinion  of  the  Experts   issued   pursuant  to
sub-paragraph  11.4 shall be conclusive in any  proceedings  between the
parties hereto as to the question of fact so determined;

11.6 the fees and  expenses  of the  Experts  shall be borne  equally  by the
Seller and the Purchaser (unless otherwise directed by the Experts); and

11.7 the Experts,  and any company,  firm,  partnership or other organisation
with  which the  Experts  are  connected,  shall not be  eligible  to be
considered  to undertake  any clean-up  work in respect of the claim for
which they have so acted on or around the Site(s) save where the parties
hereto  mutually  agree to waive this  provision.  For the  avoidance of
doubt, either party may withhold such consent in any event.

12 ACCEPTANCE OF LIABILITY

In the event that the Seller  admits  that it has any  liability  to the
Purchaser  under the Indemnity (or where the Seller agrees to accept the
Purchaser's  claim as falling within the Indemnity  notwithstanding  the
fact  that no  Environmental  Liability  may at that  point in time have
arisen):

12.1 Subject to consulting with and paying  reasonable regard to the views of
the  Purchaser,  the  Seller  shall  have  the  right  independently  to
determine  whatever  measures  are  appropriate  in order  to  remediate
pursuant to  applicable  Environmental  Laws the  subject  matter of the
claim under the  Indemnity  and  furthermore  the Seller  shall have the
right  independently  to carry out such  remediation  itself (or through
suitable  third party agents or  contractors)  provided that in so doing
the Seller (or its said agents or  contractors)  shall be obliged to use
reasonable endeavours to avoid causing undue interruption to the conduct
of the business of the Company and/or its Affiliates;

12.2 The Seller and/or its agents and  contractors  shall, in addition to the
rights of access  provided  for in  paragraph  9 above,  be free to have
access to the Site(s) if  currently  owned,  leased or, where within the
power of the Company and its  Affiliates,  during normal  business hours
after  reasonable prior notice,  and if so required,  in the presence of
authorised   representatives   of  the  Purchaser,   to  carry  out  the
remediation  referred to in  sub-paragraph  12.1 above provided that the
Seller (or its agents or contractors) shall be obliged to use reasonable
endeavours  to avoid causing  undue  interruption  to the conduct of the
business of the Company and/or its Affiliates.

12.3 The Seller shall exercise  reasonable care in the exercise of its powers
and rights  pursuant to this paragraph 12 and shall exercise  reasonable
skill,  care and  diligence  in carrying out any works and shall not use
any materials  which are not in accordance with the  recommendations  of
relevant  authorities  and codes of practice.  The Seller shall  procure
that the contractors and consultants  engaged to carry out and advise on
the works  are  bound by  obligations  in the same  terms of  reasonable
skill,  care and  diligence as herein  before  mentioned  and  otherwise
engaged  on  market  terms  at  the  time  and  shall  procure  suitable
warranties  in accordance  with normal market  practice at the time from
the contractors  and consultants in favour of the Purchaser.  The Seller
shall not carry out the works  itself but shall always  engage  external
contractors and consultants  approved by the Purchaser such approval not
to be unreasonably withheld or delayed.

13 STATEMENTS

In the event of any  circumstances  arising which do or may give rise to
Environmental  Liabilities  which  may  fall  within  the  terms  of the
Indemnity or the Counter Indemnity (as appropriate) neither the Company,
the Purchaser nor the Seller (nor any of their respective Affiliates) to
the extent  practicable  shall make any public  statements which are not
required  by law or  the  rules  of any  regulatory  authority  to  make
regarding such  circumstances  without first  discussing  with the other
party  and  reaching  written   agreement  (such  agreement  not  to  be
unreasonably  withheld  or  delayed)  on the  text  of any  such  public
statement before it is made.

14 GENERAL

14.1 Any  information,  records,  or other  material  of one  party  shall be
treated as strictly  confidential  by the other party except when (a) it
is  required to be used in order to comply with an order of the court or
regulatory authority or (b) it is used by the other party to enforce its
rights under this Schedule or so as to make an insurance  claim provided
that, in the case of either (a) or (b), disclosure is made in accordance
with this sub-paragraph  14.1. If either party becomes legally compelled
(including  by   deposition,   interrogatory,   request  for  documents,
subpoena, civil investigative demand or similar process) to disclose any
of the  information,  records,  or other  material  referred  to in this
sub-paragraph  14.1, the party so compelled shall provide the other with
prompt prior written  notice of such  requirement  so that the other may
seek a  protective  order or other  appropriate  remedy.  To the  extent
lawfully  able to do so, each party  agrees to cooperate in each other's
efforts to obtain a protective order or other reasonable  assurance that
confidential  treatment shall be accorded any such information.  If such
protective order or other remedy is not obtained, the party so compelled
agrees to disclose  only that portion of the  information,  records,  or
other  material  which it is advised  by  opinion of outside  counsel is
legally  required to be disclosed  and to take all  reasonable  steps to
preserve  the  confidentiality  of the  information,  records,  or other
material referred to in this sub-paragraph 14.1. Any other disclosure by
one party of information,  records or materials of the other party shall
require the prior written  consent of such other party,  which shall not
be unreasonably withheld or delayed.

14.2 The Purchaser's and its Affiliates' and the Seller's and its Affiliates'
exclusive  remedies in respect of any claims which fall within the scope
of the  Indemnity  or Counter  Indemnity,  as  appropriate,  shall be in
accordance  with the provisions of this  Schedule,  and the Purchaser on
behalf of itself and its Affiliates and the Seller,  on behalf of itself
and  its  Affiliates,  hereby  waives  all  other  remedies  whether  in
contract,  tort (including,  for the avoidance of doubt,  negligence) or
howsoever  otherwise arising which it may have against the Seller or any
of  its  Affiliates  or the  Purchaser  or  any  of  its  Affiliates  as
appropriate  at law or in equity in  respect of the  matters  which fall
within the scope of the  Indemnity or Counter  Indemnities  and, for the
avoidance of doubt,  if such a claim under this Schedule could also give
rise to a Warranty  Claim or a claim under any other  provision  of this
agreement in respect of the same subject  matter,  the  Purchaser or the
Seller as appropriate may only bring a claim under this Schedule.

14.3 The Seller  undertakes to  co-operate  with the Purchaser and assist the
Purchaser in achieving a transfer to the Purchaser (or as it directs) of
all Environmental Authorisations held by the Seller at Completion.

15 CO-OPERATION

The Purchaser  undertakes that wherever  co-operation is required by the
Company to ensure compliance with the Purchaser's obligations hereunder,
the  Purchaser  will use its  reasonable  endeavours  to ensure that the
Company provides the requisite co-operation.

SCHEDULE 6
CONSIDERATION ADJUSTMENT TEXT

(Clause 3.3)

1 Consideration and Adjustment

SECTION 1

(1) In this Schedule 3:

"A FORM" means,  in relation to the  Company,  the  quarterly  financial
reports  in the  format  set  forth in  Annex 3 which  are  prepared  in
accordance   with  the   accounting   policies,   practices   and  other
requirements  set out or  referred to in ICI's  Controller's  Manuals as
applied by the Company (with the exception of pensions liabilities which
are  accounted  for in  accordance  with  FAS  87) and  prepared  at the
Completion  Date on a basis  consistent with that adopted by the Company
in the A Form at 31  December  1997 (with the  exception  that  pensions
liabilities shall be reported in Provisions;  and if the Completion Date
does  not  fall on the due  date  for the  preparation  of an A Form,  a
financial  report  prepared on the same basis for the  financial  period
from the latest date at which an A Form was  prepared to the  Completion
Date;

"ACTUAL NET DEBT" means Net Debt as agreed or  determined  in accordance
with paragraphs (4) to (6) below;

"ACTUAL  NET  WORKING  CAPITAL"  means  Net  Working  Capital  as at the
Completion Date as determined under paragraphs (4) to (6) below;

"ESTIMATED CONSIDERATION" has the meaning given in sub-Clause 3.1;

"ENTERPRISE VALUE" means US$16,733,000;

"FINAL CONSIDERATION" has the meaning given in paragraph (3)(a) below;

"FINAL  COMPLETION  STATEMENT" has the meaning given in paragraph (3)(b)
below;

"FINAL STOCKS" means the value of Stocks for the Company at Completion;

"ICI'S  CONTROLLER'S  MANUALS" means the control manuals in existence at
14 July 1997 and which are compiled in accordance  with UK GAAP used for
accounting purposes within the Seller's Group, copies of which have been
received by the  Purchaser or an Affiliate of the  Purchaser  (and which
consists of an introduction to the Group Controller's  Manual,  Bulletin
Board  Accounting   Language,   Bulletin  Board  Reporting,   Accounting
Definitions  and  Conventions,   Accounting   Policies  and  Procedures,
Controls, Reporting);

"INITIAL  STOCKS"  means the value of Stocks  for the  Company  as at 28
February 1998;

"INTEREST RATE" means LIBOR plus 25 basis points;

"NET DEBT" means the amount  reported as "NET DEBT" on line 70090 of the
A Form for the Company as described in ICI's Controller's Manuals which,
for the avoidance of doubt,  can be either a negative or a  non-negative
number;

"NET WORKING CAPITAL" means the aggregate of:

(a)    Operating Debtors; plus

(b)    Stocks  (for the  purposes  of this  definition  meaning  Initial
Stocks when used for Net Working  Capital as at 28 February  1998
and  meaning  Final  Stocks  when  used for  Actual  Net  Working
Capital); less

(b)    Operating Creditors less than 1 year;

For the  purposes of (b) the Stocks shall be valued in  accordance  with
the document headed "STOCKTAKING AND VALUATION PRINCIPLES" in the Agreed
Form marked "NWC-S";

"NET WORKING CAPITAL AS AT 28 FEBRUARY 1998" or "NWC28" means, the value
shown in the column  headed NWC 28 in Section 2 of this Schedule 3 which
is the amount which the parties  have agreed to  represent  the value of
Net Working Capital at 28 February 1998 of the Company;

"OPERATING  CREDITORS  LESS THAN 1 YEAR" means the absolute value of the
amount  reported as creditors  of the Company  which are external to the
Company (including without limitation creditors which are members of, or
other  business  units  within,  the  ICI  Group  as at the  date of the
relevant A Form) as defined by reference to  "OPERATING  CREDITORS  LESS
THAN 1 YEAR" on line 70020 of the A Form for the Company as described in
ICI's Controller's Manuals;

"OPERATING  DEBTORS"  means debtors of the Company which are external to
the Company  (including without limitation debtors which are members of,
or other  business  units  within,  the ICI  Group as at the date of the
relevant A Form) as defined by reference to "OPERATING  DEBTORS" on line
70010 of the A Form for the Company as described  in ICI's  Controller's
Manuals;

"STOCKS"  means  the  stock  of  fuels,   raw  materials,   ingredients,
packaging,  office and laboratory supplies,  revenue engineering spares,
consumable  stores,  work in progress  and  finished  goods owned by the
Company as  determined  on line  70000 of the A Form for the  Company or
Business as described in ICI's Controller's Manuals;

(2)

(a)    All  payments  and  values  under  this  Schedule  shall be in US
Dollars  and  where an  amount  is not  itself  calculated  in US
Dollars it shall be  converted  into US Dollars at the mid market
closing  exchange  rate in London for the  currency in which that
amount is  expressed  in US  Dollars as  published  in the London
Edition of the Financial  Times first  published  thereafter  or,
where the exchange  rate is not  published in the London  Edition
of the Financial  Times,  at the exchange rate quoted by Citibank
N.A. as at the close of  business  in London for the  currency in
which  that  amount  is  expressed  on  the  Completion  Date  in
relation to amounts in the Final Completion Statement.

(b)    References to the absolute value of a number X shall be construed
as follows:

(i) if X is greater than or equal to zero,  the absolute value of
X shall be equal to X; and

(ii)if X is less than zero,  the  absolute  value of X shall be X
multiplied by -1,

so that, for the purposes of illustration,  the absolute value of
1 is equal to 1 and the absolute value of -1 is equal to 1.

CALCULATION OF THE FINAL CONSIDERATION

(3) In relation to this agreement:

(a)    the Final  Consideration  for the Company  shall be determined by
the following formula:

Final Consideration = EV minus AND minus NWC 28 plus ANWC

Where (in relation to the Company):

EV = Enterprise Value

AND = Actual Net Debt

NWC28 = Net Working Capital as at 28 February 1998

ANWC = Actual Net Working Capital

(b)    After  the   Completion   Date,   the  Seller  shall   prepare  a
completion  statement  as at  the  Completion  Date  which  shall
contain a  statement  of the Final  Consideration  in  accordance
with  paragraph  3(a) above  based on the  Seller's  calculations
(the  "FINAL   COMPLETION   STATEMENT").   The  Final  Completion
Statement   shall  be   prepared   using  the   Seller's   normal
accounting  policies  and  practices as set out or referred to in
ICI's  Controller's  Manuals  as  applied  by  the  Company  on a
consistent  basis and  shall be  submitted  by the  Seller to the
Seller's Auditors for review.

(4) Within 45 days of the Completion  Date, the Seller shall issue the Final
Completion  Statement for the Company to the  Purchaser  together with a
copy of a report by the  Seller's  Auditors  addressed to the Seller and
substantially  in the  form set out in  Annex 3 to the  effect  that the
Final  Completion  Statement has been  prepared in accordance  with this
agreement.  Although it is the  Seller's  responsibility  to prepare the
Final  Completion  Statement,  the Seller will require the assistance of
the  employees  of the  relevant  Purchaser  Affiliates  to fulfil  this
responsibility  and  the  Purchaser  shall  ensure  such  assistance  is
provided  promptly and at no charge.  Immediately  after delivery of the
Final  Completion  Statement,  the  Purchaser's  Auditors shall have the
right,  subject to the Purchaser  delivering to the Sellers'  Auditors a
signed  letter  in the  form set out in Annex  5, to  review  the  Final
Completion  Statement and the Seller's  Auditors working papers relating
to the Final  Completion  Statement.  Within 45 days of  delivery to the
Purchaser of the Final  Completion  Statement and the Seller's  Auditors
report (each of which shall be in English) to the Purchaser's designated
location,  the  Purchaser  shall give notice to the Seller in writing of
any item or items in the Final  Completion  Statement which they wish to
dispute and the basis on which they dispute that item or those items and
the  changes  to the Final  Completion  Statement  which  the  Purchaser
believes  should be made and the  parties  shall  use  their  reasonable
endeavors  to resolve  that  dispute.  Any items in respect of which the
Purchaser does not give such notice will be deemed to have been accepted
by the Purchaser.  Any written  resolution reached by the parties on any
disputed item shall be final, conclusive and binding on the parties.

(5) If the parties agree the Final  Completion  Statement then any adjusting
payments  referred to in paragraph (7) below shall be made by the paying
party within 7 days of being agreed by the parties.

(6) If the  parties  fail to agree on any  element  of the Final  Completion
Statement within 14 days after the Purchaser has given notice in writing
to the Seller of any item(s) in the Final Completion Statement which the
Purchaser  wishes to dispute (in  accordance  with  paragraph (4) above)
then any agreed  amounts shall be paid in accordance  with the preceding
paragraph  and any dispute  may be  referred  by either  party for final
determination  in accordance  with sub-Clause 11.1 of this agreement and
any  amounts  thereby  found  to be due  shall  be paid by the  relevant
Affiliate not later than 7 days after such final determination.

(7) When the  Final  Consideration  is  agreed or  otherwise  determined  in
accordance with the three preceding  paragraphs the following  adjusting
payments shall be made:

(a)    an  amount  equal to the  difference  between  (i) the  Estimated
Consideration and (ii) the Final Consideration; and

(b)    interest  (compounded monthly) at the Interest Rate on the amount
in paragraph  (a) above from the  Completion  Date to the date of
payment, calculated on a day to day basis;

which shall be paid by the Seller  Affiliate to the  Purchaser  (or vice
versa, as appropriate).

(8) In this Schedule, references to lines of A Forms have been chosen by the
Seller and are  believed in good faith to  correspond  to the matters to
which they refer.  If,  however,  that  reference  when  compared to the
matter it  describes  or  refers to is  incorrect  then  there  shall be
substituted  for that line  reference to another line reference (if any)
which corresponds to the matter described or referred to.

SECTION 2

VALUES FOR THE PURPOSE OF
ALLOCATION TO CLASSES OF
ASSET

NET                 ADDITIONAL
WORKING                UPLIFT OF
NWC28         CAPITAL           STOCKS TO FAIR
CANADIAN $           US$           MARKET VALUE US$

Americas Business    7,444,000        5,200,000                  62,000
LPC Business         2,575,000        2,000,000                     Nil

SCHEDULE 7
CANADIAN FINANCIAL INFORMATION

(Clause 1.1)

TCI BALANCE SHEET
AT 28 FEBRUARY
1998

CANADIAN DOLLARS THOUSANDS
AMERICAS
BUSINESS   LPC BUSINESS         TOTAL

Fixed Assets              12,167              -        12,167

Investments                    -              -             -

Stocks                    20,342          4,258        24,600

Operating Debtors          7,216          1,425         8,641

TAI Debtor                 2,515              -         2,515

Operating
Creditors less
than 1 year              (22,629)        (1,109)      (23,738)

TAI Creditor                   -         (1,999)       (1,999)

Non Operating
Debtors                        -              -             -

Non Operating
Creditors less
than 1 year               (1,043)             -        (1,043)
18,568          2,575        21,143
--------       --------      --------

Net Debt                 (20,824)             -       (20,824)

Provisions                     -              -             -
-
Deferred Income
--------       --------      --------
(20,824)             0       (20,824)

Shareholders'                                          41,967
Equity                                               --------

21,143
--------
Notes:
1. Operating Debtors at 28 Feb 1998 have been split pro rata to sales
in January and February 1998.
2. TAI Debtors/TAI Creditors and TCI Debtors/TCI Creditors net out

SCHEDULE 8

(Clause 1.7)

John Collingwood

Rene Lachance

John Gush

Michel Blais

Guy Gauthier

Michael Maughan

SCHEDULE 9
LPC Business

- -----------------------------------------------------------------------
AMERICAS
(SULPHATE)
LPC BUSINESS      BUSINESS          COMMENTS
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
FIXED ASSETS                           All
- -----------------------------------------------------------------------
INVESTMENTS          N/A               N/A
- -----------------------------------------------------------------------
- Based on
actual
Stocks                              quantities
manufactured by                     of stocks
LPC and Kronos                      from each
STOCKS               at Varennes       All other stocks  source
- -----------------------------------------------------------------------
- Based on
Sales of                            detailed
material                            analysis of
OPERATING DEBTORS    manufactured by                     all open
Trade Debtors}       LPC and Kronos    All other trade   accounts
Intra Group Debtors} at Varennes       debtors           concerned
- -----------------------------------------------------------------------
Other operating
debtors                                All
- -----------------------------------------------------------------------
- Based on
OPERATING CREDITORS  Purchases of                        detailed
LESS THAN 1 YEAR     material          All other         analysis of
Trade Creditors}     manufactured by   operating         all open
Intra Group          LPC and Kronos    creditors less    accounts
Creditors}           at Varennes       than 1 year       concerned
- -----------------------------------------------------------------------
Other operating
creditors                              All
- -----------------------------------------------------------------------
NON OPERATING
DEBTORS/CREDITORS                      All
- -----------------------------------------------------------------------
NET DEBT                               All
- -----------------------------------------------------------------------
PROVISIONS                             All
- -----------------------------------------------------------------------
DEFERRED INCOME                        All
- -----------------------------------------------------------------------
- Calculated
NET ASSETS                                               by difference
- -----------------------------------------------------------------------
NOTES:

1 Stocks/materials/product   manufactured   by  LPC  includes  items  made
available to LPC under product swap  arrangements with Kronos's plant at
Varennes

SCHEDULE 10
(CLAUSE 7.1(F)(III))

SIGNATURES

SIGNED by
for and on behalf of
TIOXIDE GROUP LIMITED      }

SIGNED by
for and on behalf of
ICI OMICRON BV             }

SIGNED by
for and on behalf of
[PURCHASER]                }

ANNEX 1
AGREED FORM DEED OF INDEMNITY

EXHIBIT 10.8

Dated 1998

IMPERIAL CHEMICAL INDUSTRIES PLC

and

N L INDUSTRIES, INC.

AMERICAS LIABILITY AGREEMENT

LINKLATERS & PAINES
One Silk Street
London EC2Y 8HQ

Ref: AXT

THIS AGREEMENT (this  "AGREEMENT") is made on                       1998
BETWEEN:

(1) IMPERIAL CHEMICAL  INDUSTRIES PLC, a company  incorporated under the
laws of England,  whose  registered  office is at Imperial  Chemical
House, 9 Millbank, London, SW1P 3JF ("ICI"); and

(2) N L INDUSTRIES,  INC., a corporation  incorporated under the laws of
the State of New Jersey,  USA, whose  principal place of business is
at 16825 Northchase Drive, Suite 1200, Houston, Texas 77060 USA (the
"PURCHASER").

WHEREAS:

(A) ICI and the Purchaser and their  respective  Affiliates have entered
into or will enter into certain agreements  relating to the purchase
of the Companies (as defined below) namely:

*  the Share Sale Agreements;

*  the Tax Deeds of Covenant; and

*  the Guarantees

in  each  case  as  defined  below   (hereinafter   collectively  or
individually    called   the   "AGREEMENTS"   or   individually   an
"Agreement").

(B) The parties have agreed on certain  liability  and claim  provisions
that shall  apply in respect  of the  Agreements  upon the terms and
subject to the conditions of this agreement.

IT IS AGREED as follows:

1 INTERPRETATION

Except  where  the  context  requires  otherwise,  the  definitions  and
provisions  as to  interpretation  set forth  below  shall apply to this
agreement:

"AFFILIATES"  means,  with respect to a specified entity, an entity that
directly or indirectly through one or more intermediaries,  Controls, or
is Controlled by, or is under common Control with the entity  specified,
provided that, in relation to ICI and its subsidiary companies,  without
limiting the generality of the foregoing,  the term  "AFFILIATES"  shall
not  include  any  entity in which a party  has a 50 per  cent.  or less
ownership  interest.  For purposes hereof,  "Control" means  possession,
directly or indirectly, of the power to direct or cause the direction of
the management and operating  policies of the entity in respect of which
the  determination  is being  made,  through  the  ownership  of  voting
securities, contract, voting trust or otherwise;

"ACQUISITION  SEPARATION  PROGRAMME CLAIM" means any claim (other than a
claim for fraud) by the Purchaser  Companies wider Clause [ ] of the TAI
Share  Sale  Agreement  and/or  under  Clause [ ] of the TCI Share  Sale
Agreement;

"BENEFIT  CLAIM"  means any claim  (other than a claim for fraud) by the
Purchaser  Companies  arising  under  Clause  8.4 of the TAI Share  Sale
Agreement and/or under Clause 8.4 of the TCI Share Sale Agreement;

"CAP" has the meaning set forth in sub-Clause 3.2;

"CLAIM"  means any claim (other than a claim for fraud) by the Purchaser
Companies for breach of the  warranties,  under the indemnities or under
any other  provision  contained in the Agreements or the  Implementation
Agreements  (as defined  in the Agreements)  for which the ICI Companies
accept liability, are liable or shall be adjudicated  as  being  liable,
excluding all Tax Claims;

"COMPANIES" means Tioxide Canada Inc. and Tioxide Americas Inc.;

"COMPLETION  DATE"  means  for  each  Company  the  Completion  Date  as
defined in the Share Sale Agreements;

"GUARANTEES"  means the  guarantees  to be  entered  into by ICI and the
Purchaser in respect of the obligations of their  respective  Affiliates
under the Agreements;

"ICI COMPANIES"  means all or any of ICI and those of its Affiliates who
are parties to the Agreements and shall be deemed to include their legal
successors and permitted assigns;

"PURCHASER  COMPANIES"  shall mean all or any of the Purchaser and those
of its  Affiliates  who are  parties  to the  Agreements  (or any of the
Companies  the shares of which are acquired  pursuant to the  Agreements
which thereby  become  Affiliates of the Purchaser and which may (or are
required  to)  bring  Claims  pursuant  to the  terms  of  the  relevant
Agreements)  and shall be deemed to include their legal  successors  and
permitted assigns;

"QUALIFYING AMOUNT" has the meaning set forth in sub-Clause 3.1.1;

"SHARE  SALE  AGREEMENTS"  means the  agreements  between ICI and/or its
relevant  Affiliate(s) and the relevant  Purchaser  Affiliate(s) for the
sale and purchase of the Companies;

"TAI SHARE SALE  AGREEMENT"  means the share sale agreement of even date
between ICI American  Holdings Inc and NL Industries,  Inc.  relating to
the sale of Tioxide Americas Inc;

"TAX CLAIM" means any claim by the Purchaser  Companies  under the Deeds
of  Indemnity  or for breach of the  warranties  in respect of  taxation
matters  contained in the Agreements for which the ICI Companies  accept
liability, are liable or shall be adjudicated as being liable;

"TAX  DEEDS OF  COVENANT"  means the deeds of  indemnity  in  respect of
taxation  to be  entered  into  pursuant  to  the  relevant  Share  Sale
Agreements;

"TCI SHARE SALE  AGREEMENT"  means the share sale agreement of even date
between  Tioxide  Group  Ltd,  ICI  Omicron  BV and NL  Industries  Inc.
relating to the sale of Tioxide Canadas Inc; and

"THRESHOLD AMOUNT" has the meaning set forth in sub-Clause 3.1.2.

2 ADHERENCE OF THE PURCHASER COMPANIES AND THE ICI COMPANIES

2.1 The parties hereto have entered into this agreement for the benefit, and
to accept  restrictions  on behalf,  of themselves and their  respective
Affiliates.  In this respect,  the Purchaser has agreed on behalf of the
Purchaser  Companies that the liability of the ICI Companies  arising in
connection  with the  Agreements  shall be  limited as set forth in this
agreement. Accordingly, the Purchaser hereby agrees to procure that each
of the Purchaser  Companies and any third party  claiming or acting with
the consent of or at the behest of, through, in the name or on behalf of
the Purchaser  Companies  (whether by right of subrogation or otherwise)
shall  strictly  adhere  to and  comply  with  the  provisions  of  this
agreement as if they were each a party hereto.

2.2 If and to the extent that any of the  Purchaser  Companies or such third
parties  fail,  omit or decline to so adhere  and comply  (for  whatever
reason)  the  Purchaser  hereby  covenants  with ICI (for the benefit of
itself and each of the ICI Companies) that it will indemnify, defend and
hold  harmless  the ICI  Companies  from  all  claims,  costs,  damages,
expenses (including reasonable  professional fees), losses,  liabilities
and  penalties  suffered or incurred by the ICI Companies as a result of
and in connection with such non-adherence or non-compliance.

3 Limitation of ICI Companies' Liability

3.1 It is hereby agreed that the ICI  Companies  shall have no liability for
any  Claim  (other  than  Benefit  Claims  and  Acquisition   Separation
Programme Claims):

3.1.1  unless  the  amount of such  Claim or  alleged  Claim  exceeds US
$100,000 (the "Qualifying Amount"); and

3.1.2  until and to the extent only that the aggregate liability for all
Claims exceeding the Qualifying Amount (notified previously or at
the same time) exceeds US $1.4 million (the "Threshold Amount").

For the avoidance of doubt, notwithstanding that the aggregate liability
of the ICI Companies for Claims exceeding the relevant Qualifying Amount
has exceeded the Threshold  Amount,  the ICI  Companies  shall be liable
solely for that excess.

3.2 Subject to Clause 4.1.1, it is hereby agreed that the maximum  aggregate
liability  of the ICI  Companies  in respect of all Claims  (other  than
Benefit  Claims)  shall  under no  circumstances  exceed an amount to be
determined as follows (the "Cap"):

3.2.1  in respect of Claims  notified to the ICI  Companies  pursuant to
the Agreements  and/or this agreement in the period commencing on
the Completion Date up to but not including the third anniversary
thereof, the Cap shall be US $25,000,000;

3.2.2  on the third  anniversary  of the  Completion  Date the Cap shall
reduce to US $17,500,000;

3.2.3  on the fourth and each  subsequent  anniversary of the Completion
Date  the  Cap  shall   reduce   (but  so  that  the   applicable
anniversary  date for  determining  whether a Claim is subject to
a Cap  reduction as  aforesaid  shall be by reference to the date
upon which the Claim is  notified to the ICI  Companies  pursuant
to the  Agreements  and/or this  agreement  and not the date upon
which  liability  thereunder  is accepted or  adjudicated)  by an
amount of US  $2,500,000  such that on the tenth  anniversary  of
the Completion Date it is completely extinguished;

3.2.4  the ICI Companies  shall have no liability for any Claim notified
by the Purchaser  Companies on or after the tenth  anniversary of
the Completion Date.

3.3 In no circumstances  whatsoever shall the maximum aggregate liability of
the ICI Companies in respect of all Claims exceed US $25,000,000.

3.4 Subject to the obligations as to  notification in Clause 4.1.1,  but not
the time limits for notification, it is hereby agreed that:

(i) the  maximum  aggregate  liability  of the ICI  Companies  in
respect of all Benefit  Claims  shall under no  circumstances
exceed US$10,000,000; and

(ii)the  maximum  aggregate  liability  of the ICI  Companies  in
respect of all Acquisition  Separation  Claims shall under no
circumstances exceed US$2,500,000.

3.5 All monetary amounts  expressed in US Dollars in this agreement shall be
calculated  after  converting  all relevant  monetary  amounts under the
Agreements  which are not in US Dollars to US Dollars at the  mid-market
closing exchange rate in London for amounts of that size as published in
the London  Edition of the Financial  Times  published two Business Days
prior to the  date  any  Claim is  formally  notified  by the  Purchaser
Companies  in  accordance  with  the  terms of the  relevant  Agreements
(and/or this agreement), or where no such rate is published, at the rate
quoted by  Citibank,  N.A.  at the close of  business  in London on that
date.

4 MITIGATION OF CLAIMS

4.1 The Purchaser  Companies shall take all reasonable steps to mitigate any
loss which may give rise to a Claim against the ICI Companies including,
without limiting the generality of the foregoing,  the making of a claim
which is  available  to the  Purchaser  Companies  under  any  available
insurance policy. It is agreed that:

4.1.1  no Claim by the  Purchaser  Companies  in  respect of a breach of
the warranties under the Agreements  shall be enforceable  unless
written notice thereof  (including all material  details  thereof
then  reasonably  available to the Purchaser  Companies) has been
given by the  Purchaser  Companies  to the ICI  Companies as soon
as  reasonably  practicable  after the Purchaser  Companies  have
become aware of the facts and  circumstances  giving rise to such
Claim and their  implications  for the purposes of the  Agreement
in question,  unless such written  notice has been duly served on
the ICI  Companies  on or  before  [30 April  2001(1)/2002(2)] or
by close of business on the date six years  after  the end of the
accounting  period  ending after the  Completion  Date in respect
of a Tax Claim;

4.1.2  no other Claims by the Purchaser  Companies  shall be enforceable
unless  written notice  thereof  (including all material  details
thereof or relating  thereto  then  reasonably  available  to the
Purchaser  Companies  has been given by the  Purchaser  Companies
to the  ICI  Companies  (in  accordance  with  the  terms  of the
Agreement in question) as soon as  reasonably  practicable  after
the  Purchaser  Companies  have  become  aware of the  facts  and
circumstances  giving  rise to the Claim  and their  implications
for the purposes of the Agreement in question;

Provided however that the Purchaser Companies shall be able to bring any
Claim  against the ICI  Companies  without  complying  with the terms of
sub-Clauses  4.1.1 and 4.1.2 hereof to the extent that the ICI Companies
have not suffered  prejudice as a result of any such  non-compliance  by
the Purchaser Companies.

4.2 If any claim is made against the Purchaser  Companies the subject matter
of which might  reasonably  be expected to constitute a breach of one or
more  of the  Agreements  by the  ICI  Companies  save  for  indemnities
contained  in the Tax Deeds of  Covenant  or  environmental  indemnities
contained in the relevant  Agreements  in relation to which the specific
provisions set out in the relevant Agreement or Deed shall apply:

4.2.1  the Purchaser  Companies  shall if so requested in writing by the
ICI Companies  take all steps which are necessary and  reasonable
to avoid,  resist,  appeal,  compromise  or defend any such claim
and any  adjudication  in  respect  thereof  (but  subject in any
such case to the Purchaser  Companies  being  indemnified  by the
ICI  Companies  against  all  costs  and  expenses  which  may be
incurred in connection  therewith)  and the ICI Companies  shall,
at  their  request,  be  allowed  to  conduct  any  negotiations,
proceedings   or  appeals   incidental   thereto   with   counsel
reasonably satisfactory to the Relevant Purchaser;

4.2.2  the ICI  Companies  shall  raise no  objection  to the  Purchaser
Companies  attending  (and,  where the  rights  of the  Purchaser
Companies  are,  or  may  be,   detrimentally   affected)   being
separately  legally  represented  (at  their  own  expense)  and,
where  appropriate,  heard at any  negotiations,  proceedings  or
appeals of which the ICI  Companies  have taken  conduct  and the
Purchaser  Companies  shall  be  consulted  by the ICI  Companies
prior to any  compromise,  settlement  or  admission of liability
being   made  by  the   ICI   Companies   at  such   negotiation,
proceedings or appeals; and

- --------
(1).  If completion takes place in 1999

(2). If completion takes place in 2000

4.2.3  the Purchaser  Companies  shall at all reasonable  times and upon
reasonable  prior  notice  allow  the  ICI  Companies  and  their
agents  reasonable  access  to  all  relevant  properties  of the
Relevant  Purchaser,  and  access  to,  with the right to inspect
and take  copies  of,  all  relevant  books  and  records  of the
Relevant  Purchaser  (as  then  carried  on)  subject  always  to
keeping   the  same   confidential   other  than  in  respect  of
necessary   disclosures  in  connection  with  such  Claim  which
disclosures  shall  only be  made,  and then  only in  compliance
with  sub-Clause  4.2.4,  if required by law or the procedures of
any  court  or  tribunal  or  otherwise  with the  prior  written
consent of the relevant  Purchaser  Companies  (such  consent not
to be unreasonably withheld or delayed).

4.2.4  If any of the  ICI  Companies  or  their  agents  become  legally
compelled  (including by deposition,  interrogatory,  request for
documents,   subpoena,  civil  investigative  demand  or  similar
process) to disclose any of the  information,  records,  or other
material   referred  to  in  this  Clause  4.2.3,  the  party  so
compelled  shall  provide  the  Relevant  Purchaser  with  prompt
prior  written  notice of such  requirement  so that the Relevant
Purchaser  may  seek a  protective  order  or  other  appropriate
remedy.  So  far  as  it  is  legally  able  so to  do,  the  ICI
Companies   agree  to  cooperate  in  the  Relevant   Purchaser's
efforts  to  obtain  a  protective   order  or  other  reasonable
assurance  that  confidential  treatment  shall be  accorded  any
such  information.  If such  protective  order or other remedy is
not  obtained,  the party so  compelled  agrees to disclose  only
that  portion  of the  information,  records,  or other  material
which it is advised  by  opinion  of  outside  counsel is legally
required  to be  disclosed  and to take all  reasonable  steps to
preserve the  confidentiality  of the  information,  records,  or
other material referred to in this sub-Clause 4.2.4.

4.2.5  Notwithstanding  the  foregoing  provisions,  should the  subject
matter of any litigation, proceeding, negotiation, or arbitration
include a claim against the Relevant Purchaser seeking injunctive
relief,  the  Relevant  Purchaser  shall  have the  right to take
exclusive  control of the defence of such proceeding with counsel
of its choice, the reasonable fees and expenses of which shall be
for the account of the ICI Companies.

4.2.6  The   party   or   parties   conducting   the   defence   of  any
investigation,    litigation,   proceedings,    negotiations   or
arbitration   shall  keep  the  other  parties  apprised  of  all
significant   developments   and  shall   not   enter   into  any
settlement,  compromise  or consent to judgment  with  respect to
such  investigation,  litigation,  proceedings,  negotiations  or
arbitration  unless the other party  consents,  such  consent not
to be unreasonably withheld or delayed.

4.3 If the ICI Companies pay to the Purchaser Companies any amount under any
of the  Agreements in respect of any Claim under such  Agreement and the
Purchaser  Companies  are  thereafter  able to recover  any sum from any
third  party  (including  any  insurer)  in respect of that  Claim,  the
Purchaser  Companies  shall use all reasonable  endeavours to so recover
any such sum and shall repay to the ICI  Companies so much of the amount
paid by the ICI  Companies  as is  equal  to any  sum  recovered,  after
allowing  for  the  reasonable  costs  and  expenses  of  the  Purchaser
Companies reasonably incurred in connection therewith.

Furthermore, if any liability on the part of the ICI Companies under any
of the  Agreements  which  results  in a payment  being  made by the ICI
Companies to the  Purchaser  Companies  gives rise to any  corresponding
saving or rebate for the Purchaser  Companies  (including any tax saving
or rebate) then the value of such corresponding  saving or rebate to the
Purchaser  Companies  shall  be set  against  the  liability  of the ICI
Companies in the particular instance.

5 CONSIDERATION REDUCED BY CLAIMS

Any payment by the ICI Companies paid to the Purchaser Companies (or for
the Purchaser  Companies'  benefit) in respect of any Claim or Tax Claim
shall be deemed to be a reduction in the consideration payable under the
relevant Agreement in respect of the business,  assets or shares thereby
sold.

6 NO SET-OFF

None of the Purchaser Companies shall be entitled to set off any amounts
due to it by the  ICI  Companies  (whether  under  this  agreement,  the
Agreements  or  otherwise)  against  the sums owing (or  claimed by such
other party to be owing) under the terms of this agreement.

7 NOTICES

7.1 Any notice or other document to be served under this agreement  shall be
in writing and may be  delivered by hand or by courier or sent by fax or
by post to the  party to be  served  at its  address  appearing  in this
agreement  (and  marked for the  attention  of the person  whose name is
referred to in sub-Clause 7.3 below) or at such other address (or marked
for the  attention of such other  person) as it may have notified to the
other  parties  in  accordance  with this  Clause.  Any  notice or other
document sent by post shall be sent by  registered  post (if both posted
and for delivery within the same  jurisdiction) or by registered airmail
(if posted for delivery outside the jurisdiction in which it is posted),
return receipt requested (or any substantially equivalent service).

7.2 Any notice or document  delivered or sent in accordance  with sub-Clause
7.1 shall be deemed to have been served:

7.2.1  if delivered by hand or by courier, at the time of delivery; or

7.2.2  if sent by fax,  at the time of delivery  if sent  between  12.01
a.m. and 6.00 p.m.  (local time at the  destination)  or at 10.00
a.m.  (local time at the  destination)  on the Business Day after
its transmission (if sent at any other time); or

7.2.3  if posted,  at 10.00 a.m. on the second Business Day after it was
put  into  the  post if  posted  for  delivery  within  the  same
jurisdiction, or at 10.00 a.m. (local time at the destination) on
the  fifth  Business  Day after it was put in the post if sent by
registered airmail.

7.3 The person to whom  notices or  documents  should be  addressed  for the
purposes of sub-Clause 7.1 is:

7.3.1  if to be served on ICI:

the Company Secretary
Imperial Chemical House
9 Millbank
London SW1P 3JF
Fax: (44) 171 798 5170

7.4 if to be served on the Purchaser:

General Counsel
NL Industries, Inc
16825 Northchase Drive
Suite 1200
Houston, Texas 77060, USA
Fax: (1) 281 423 3333

7.5 In proving  service of a notice or  document it shall be  sufficient  to
prove  that  delivery  was  made by  hand,  courier  or fax or that  the
envelope  containing  the notice or document was properly  addressed and
posted (either by registered post or by registered  airmail, as the case
may be, in accordance with the requirements of this Clause).

8 GOVERNING LAW

8.1 This  agreement  shall be governed and construed in accordance  with the
laws of England  and the  parties  hereto  agree to  submit,  subject to
sub-Clause 8.2. to the exclusive jurisdiction of the courts of the state
of Delaware as regards any claims or matters arising hereunder.

8.2 If the courts of the state of Delaware should decline jurisdiction,  the
English  courts  shall  have  exclusive  jurisdiction  for all  purposes
relating to this agreement.

8.3 In both  sub-Clause 8.1 and 8.2,  neither party shall take any action to
avoid,  dispute  or suggest  to such  court  that such  jurisdiction  is
improper.

8.4 ICI  irrevocably  appoints ICI American  Holdings Inc as its  authorised
agent ("ICI  Authorised  Agent")  upon whom process may be served in any
legal  suit,  action or  proceeding  arising  out of or based  upon this
Agreement  which  may be  instituted  in the  courts  of  the  State  of
Delaware.

8.5 If the  English  courts have  jurisdiction,  the  Purchaser  irrevocably
appoints  Herbert Smith (Ref 534) of Exchange  House,  Primrose  Street,
London, EC2A 2HS as its agent for process in England.

In Witness whereof the parties have caused this agreement to be executed
as a Deed and delivered the day and year first above written.

Executed as a Deed             }
for and on behalf of
IMPERIAL CHEMICAL INDUSTRIES
PLC

Executed as a Deed             }
for and on behalf of
NL INDUSTRIES, INC.

EXHIBIT 10.9

INTERCORPORATE SERVICES AGREEMENT

This INTERCORPORATE SERVICES AGREEMENT (the "AGREEMENT"),  effective as of
January 1, 1998,  amends and  supersedes  that certain  Intercorporate  Services
Agreement effective as of January 1, 1997 by and between CONTRAN CORPORATION,  a
Delaware  corporation  ("CONTRAN"),  and  NL  INDUSTRIES,  INC.,  a  New  Jersey
corporation. ("RECIPIENT"),

RECITALS

A.  Harold C.  Simmons,  an  employee  of Contran  and a director  and the
Chairman of the Board of  Recipient,  performs  certain  advisory  functions for
Recipient,  which  functions are unrelated to his function as a director and the
Chairman of the Board of Recipient, without direct compensation from Recipient.

B. Recipient does not separately  maintain the full internal capability to
perform all necessary advisory functions that Recipient requires.

C. The cost of engaging the advisory  services of someone  possessing  Mr.
Simmons'  expertise  and the cost of  maintaining  the  personnel  necessary  to
perform the functions  provided for by this  Agreement  would exceed the fee set
forth in SECTION 3 of this Agreement and the terms of this Agreement are no less
favorable to Recipient  than could  otherwise be obtained from a third party for
comparable services.

D. Recipient desires to continue receiving the advisory services of Harold
C. Simmons and Contran is willing to continue to provide such services under the
terms of this Agreement.

AGREEMENT

For and in  consideration  of the  mutual  premises,  representations  and
covenants herein contained, the parties hereto mutually agree as follows:

SECTION 1.  SERVICES  TO BE PROVIDED.  Contran  agrees to make available
to Recipient,  upon request,  the following  services (the  "SERVICES")  to be
rendered by Harold C. Simmons:

(a)   Consultation   and   assistance   in   the   development   and
implementation of Recipient's  corporate  business  strategies,  plans and
objectives; and

(b) Such other  services as may be requested by Recipient  from time
to time.

This  Agreement  does not apply to and the  Services  provided for herein do not
include any services that Harold C. Simmons may provide to Recipient in his role
as a director on  Recipient's  Board of Directors,  as Chairman of such Board of
Directors or any other activity related to such Board of Directors.

SECTION 2. MISCELLANEOUS  SERVICES. It is the intent of the parties hereto
that Contran provide only the Services requested by Recipient in connection with
routine  functions  related to the ongoing  operations of Recipient and not with
respect to special projects,  including corporate investments,  acquisitions and
divestitures.  The parties  hereto  contemplate  that the  Services  rendered in
connection with the conduct of Recipient's  business will be on a scale compared
to that existing on the effective date of this Agreement,  adjusted for internal
corporate  growth or contraction,  but not for major  corporate  acquisitions or
divestitures,  and  that  adjustments  may be  required  to the  terms  of  this
Agreement in the event of such major  corporate  acquisitions,  divestitures  or
special  projects.  Recipient will continue to bear all other costs required for
outside  services  including,  but not  limited  to,  the  outside  services  of
attorneys, auditors, trustees, consultants,  transfer agents and registrars, and
it is expressly understood that Contran assumes no liability for any expenses or
services  other than those  stated in SECTION 1. In  addition to the fee paid to
Contran by  Recipient  for the  Services  provided  pursuant to this  Agreement,
Recipient  will pay to Contran  the amount of  out-of-pocket  costs  incurred by
Contran in rendering such Services.

SECTION  3.  FEE  FOR  SERVICES.   Recipient  agrees  to  pay  to  Contran
$245,000.00  quarterly,  commencing  as of  January 1,  1998,  pursuant  to this
Agreement.

SECTION 4. ORIGINAL  TERM.  Subject to the provisions of SECTION 5 hereof,
the original  term of this  Agreement  shall be from January 1, 1998 to December
31, 1998.

SECTION  5.   EXTENSIONS.   This   Agreement   shall  be   extended  on  a
quarter-to-quarter  basis  after the  expiration  of its  original  term  unless
written  notification  is given by  Contran  or  Recipient  thirty  (30) days in
advance of the first day of each  successive  quarter or unless it is superseded
by a subsequent written agreement of the parties hereto.

SECTION 6. LIMITATION OF LIABILITY.  In providing its Services  hereunder,
Contran  shall  have a duty  to act,  and to  cause  its  agents  to  act,  in a
reasonably  prudent  manner,  but  neither  Contran nor any  officer,  director,
employee or agent of Contran or its affiliates  shall be liable to Recipient for
any error of judgment or mistake of law or for any loss incurred by Recipient in
connection  with the  matter  to which  this  Agreement  relates,  except a loss
resulting from willful misfeasance, bad faith or gross negligence on the part of
Contran.

SECTION  7.  INDEMNIFICATION  OF  CONTRAN BY  RECIPIENT.  Recipient  shall
indemnify  and hold  harmless  Contran,  its  affiliates  and  their  respective
officers,  directors  and  employees  from  and  against  any  and  all  losses,
liabilities,  claims, damages, costs and expenses (including attorneys' fees and
other expenses of litigation) to which such party may become subject arising out
of the Services provided by Contran to Recipient  hereunder,  PROVIDED that such
indemnity  shall not protect  any person  against  any  liability  to which such
person would otherwise be subject by reason of willful misfeasance, bad faith or
gross negligence on the part of such person.

SECTION 8. FURTHER  ASSURANCES.  Each of the parties  will make,  execute,
acknowledge and deliver such other instruments and documents,  and take all such
other actions,  as the other party may reasonably  request and as may reasonably
be required in order to effectuate  the purposes of this  Agreement and to carry
out the terms hereof.

SECTION 9. NOTICES.  All communications  hereunder shall be in writing and
shall be addressed,  if intended for Contran,  to Three Lincoln Centre, 5430 LBJ
Freeway, Suite 1700, Dallas, Texas 75240,  Attention:  President,  or such other
address as it shall have furnished to Recipient in writing,  and if intended for
Recipient,  to Two  Greenspoint  Plaza,  16825  Northchase  Drive,  Suite  1200,
Houston,  Texas 77060,  Attention:  President or such other  address as it shall
have furnished to Contran in writing.

SECTION 10.  AMENDMENT AND  MODIFICATION.  Neither this  Agreement nor any
term hereof may be  changed,  waived,  discharged  or  terminated  other than by
agreement in writing signed by the parties hereto.

SECTION 11.  SUCCESSOR AND ASSIGNS.  This Agreement  shall be binding upon
and  inure  to the  benefit  of  Contran  and  Recipient  and  their  respective
successors  and assigns,  except that neither  party may assign its rights under
this Agreement without the prior written consent of the other party.

SECTION   12.  GOVERNING  LAW. This Agreement  shall be governed by, and
construed and interpreted in accordance with, the laws of the State of Texas.

IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to be
duly executed and delivered as of the date first above written.

CONTRAN CORPORATION

By:
STEVEN L. WATSON
VICE PRESIDENT

NL INDUSTRIES, INC.

By:
J. LANDIS MARTIN
PRESIDENT   AND  CHIEF   EXECUTIVE
OFFICER

EXHIBIT 10.10

INTERCORPORATE SERVICES AGREEMENT

This INTERCORPORATE SERVICES AGREEMENT (the "AGREEMENT"),  effective as of
January 1, 1998,  amends and  supersedes  that certain  Intercorporate  Services
Agreement effective as of January 1, 1997 by and between VALHI, INC., a Delaware
corporation ("VALHI"), and NL INDUSTRIES, INC., a New Jersey corporation ("NL").

RECITALS

A. NL desires to have the services of certain Valhi personnel and Valhi is
willing to provide such services under the terms of this Agreement.

B. Valhi  desires to have the services of certain NL  personnel  and NL is
willing to provide such services under the terms of this Agreement.

C. The costs of maintaining the additional  personnel necessary to perform
the functions  provided for by this Agreement would exceed the amount charged to
such  party  that is  contained  in the net fee set  forth in  SECTION 4 of this
Agreement  and that the terms of this  Agreement  are no less  favorable to each
party  than  could  otherwise  be  obtained  from a third  party for  comparable
services.

D. Each  party  desires  to  continue  receiving  the  services  presently
provided  by the other  party and its  affiliates  and each  party is willing to
continue to provide such services under the terms of this Agreement.

AGREEMENT

For and in  consideration  of the  mutual  premises,  representations  and
covenants  contained  in  this  Agreement,  and  for  other  good  and  valuable
consideration,  the receipt and sufficiency of which is hereby acknowledged, the
parties hereto mutually agree as follows:

SECTION 1. VALHI  SERVICES TO BE PROVIDED.  Valhi agrees to make available
to NL,  upon  request,  the  following  services  (the "VALHI  SERVICES")  to be
rendered by the internal staff of Valhi and affiliates of Valhi:

(a)   Consultation   and   assistance   in   the   development   and
implementation   of  NL's  corporate   business   strategies,   plans  and
objectives;

(b)  Consultation  and  assistance  in  management  and  conduct  of
corporate affairs and corporate governance consistent with the charter and
bylaws of NL;

(c) Consultation and assistance in maintenance of financial  records
and  controls,  including  preparation  and review of  periodic  financial
statements and reports to be filed with public and regulatory entities and
those  required to be prepared for financial  institutions  or pursuant to
indentures and credit agreements;

(d)  Consultation and assistance in cash management and in arranging
financing necessary to implement the business plans of NL;

(e)    Consultation   and   assistance   in   tax   management   and
administration,  including, without limitation,  preparation and filing of
tax returns, tax reporting, examinations by government authorities and tax
planning; and

(f) Such other services as may be requested by NL from time to time.

SECTION 2. NL  SERVICES TO BE  PROVIDED.  NL agrees to make  available  to
Valhi, upon request, the following services (the "NL SERVICES," and collectively
with the Valhi Services, the "SERVICES") to be rendered by the internal staff of
NL:

(a) The  services of Joseph S.  Compofelice  (through  February  16,
1998) to act as  Executive  Vice  President  of Valhi,  which Valhi and NL
agree shall involve  substantially  such time as has been allocated in the
past and is currently being devoted;

(b) The  services of NL's  internal  audit  personnel  in  providing
consultation  and  assistance in  performing  internal  audit  projects as
requested from time to time; and

(c) certain  administration and management  services with respect to
Valhi's   insurance  and  risk  management   needs,   including,   without
limitations, administration of Valhi's:

(i)   property and casualty insurance program,

(ii)  claims management program,

(iii) property loss control program, and

(d) Such other  services as may be  requested  by Valhi from time to
time.

SECTION 3. MISCELLANEOUS  SERVICES. It is the intent of the parties hereto
that each  party to this  Agreement  provide  (a  "PROVIDING  PARTY")  only such
Services as are requested by the other party (a "RECEIVING PARTY") in connection
with routine management,  financial and administrative  functions related to the
ongoing  operations  of the  Receiving  Party and not with  respect  to  special
projects,  including corporate investments,  acquisitions and divestitures.  The
parties hereto  contemplate  that the Services  rendered by a Providing Party in
connection  with the conduct of each  Receiving  Party's  business  will be on a
scale  compared  to that  existing  on the  effective  date  of this  Agreement,
adjusted  for  internal  corporate  growth  or  contraction,  but not for  major
corporate acquisitions or divestitures,  and that adjustments may be required to
the terms of this Agreement in the event of such major  corporate  acquisitions,
divestitures or special projects. Each Receiving Party will continue to bear all
other costs  required for outside  services  including,  but not limited to, the
outside services of attorneys, auditors, trustees, consultants,  transfer agents
and registrars, and it is expressly understood that each Providing Party assumes
no  liability  for any  expenses  or  services  other than those  stated in this
Agreement to be provided by such party.  In addition to the amounts charged to a
Receiving Party for Services provided pursuant to this Agreement, such Receiving
Party will pay the Providing Party the amount of out-of-pocket costs incurred by
the Providing Party in rendering such Services.

SECTION  4. NET FEE FOR  SERVICES.  NL agrees to pay to Valhi a net annual
fee of $12,600 payable in quarterly  installments of $3,150 each,  commencing as
of January 1, 1998,  pursuant to this  Agreement.  In addition to the net annual
fee:

(a) Valhi shall pay to NL an additional amount equal to the sum of:

(i)  the product of (x) $600, (y) the number of  days  devoted
by  NL's  internal  auditors  to  providing  NL  Services  described
in  SUBSECTION   2(B)  and  (z)  the  number  of  internal  auditors
providing such NL Services; and

(ii) all related out-of-pocket expenses;

(b) Valhi  shall  credit or pay to NL  additional  amounts  plus all
related  out-of-pocket  costs, all as agreed to by the parties, for all NL
Services provided under SUBSECTION 2(D); and

(c) NL shall  credit  or pay to Valhi  additional  amounts  plus all
related  out-of-pocket  costs,  all as agreed to by the  parties,  for all
Valhi Services provided under SUBSECTION 1(F).

SECTION 5. ORIGINAL  TERM.  Subject to the provisions of SECTION 6 hereof,
the original  term of this  Agreement  shall be from January 1, 1998 to December
31, 1998.

SECTION  6.   EXTENSIONS.   This   Agreement   shall  be   extended  on  a
quarter-to-quarter  basis  after the  expiration  of its  original  term  unless
written  notification is given by Valhi or NL thirty (30) days in advance of the
first day of each successive  quarter or unless it is superseded by a subsequent
written agreement of the parties hereto.

SECTION 7. LIMITATION OF LIABILITY. In providing Services hereunder,  each
Providing  Party shall have a duty to act,  and to cause its agents to act, in a
reasonably  prudent manner,  but no Providing  Party nor any officer,  director,
employee  or agent of such  party  nor or its  affiliates  shall be  liable to a
Receiving  Party for any error of  judgment  or  mistake  of law or for any loss
incurred  by the  Receiving  Party in  connection  with the matter to which this
Agreement relates,  except a loss resulting from willful misfeasance,  bad faith
or gross negligence on the part of the Providing Party.

SECTION 8. INDEMNIFICATION.  Each Receiving Party shall indemnify and hold
harmless the Providing  Party,  its  affiliates and their  respective  officers,
directors  and  employees  from and  against  any and all  losses,  liabilities,
claims,  damages,  costs  and  expenses  (including  attorneys'  fees and  other
expenses of litigation) to which such Providing Party may become subject arising
out of the Services  provided by such  Providing  Party to the  Receiving  Party
hereunder, PROVIDED that such indemnity shall not protect any person against any
liability to which such person  would  otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence on the part of such person.

SECTION 9. FURTHER  ASSURANCES.  Each of the parties  will make,  execute,
acknowledge and deliver such other instruments and documents,  and take all such
other actions,  as the other party may reasonably  request and as may reasonably
be required in order to effectuate  the purposes of this  Agreement and to carry
out the terms hereof.

SECTION 10. NOTICES. All communications  hereunder shall be in writing and
shall be addressed,  if intended for Valhi,  to Three Lincoln  Centre,  5430 LBJ
Freeway, Suite 1700, Dallas, Texas 75240,  Attention:  President,  or such other
address as it shall have furnished to NL in writing,  and if intended for NL, to
Two Greenspoint Plaza, 16825 Northchase Drive, Suite 1200, Houston, Texas 77060,
Attention:  President, or such other address as it shall have furnished to Valhi
in writing.

SECTION 11.  AMENDMENT AND  MODIFICATION.  Neither this  Agreement nor any
term hereof may be  changed,  waived,  discharged  or  terminated  other than by
agreement in writing signed by the parties hereto.

SECTION 12.  SUCCESSOR AND ASSIGNS.  This Agreement  shall be binding upon
and inure to the  benefit of Valhi and NL and their  respective  successors  and
assigns,  except that neither  party may assign its rights under this  Agreement
without the prior written consent of the other party.

SECTION 13.  GOVERNING  LAW.  This  Agreement  shall be  governed  by, and
construed and interpreted in accordance with, the laws of the State of Texas.

IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to be
duly executed and delivered as of the date first above written.

VALHI, INC.

By:
STEVEN L. WATSON
VICE PRESIDENT

NL INDUSTRIES, INC.

By:
J. LANDIS MARTIN
President   and  Chief   Executive
Officer

EXHIBIT 10.11

INTERCORPORATE SERVICES AGREEMENT

INTERCORPORATE  SERVICES AGREEMENT effective as of January 1, 1998, by and
between  Tremont  Corporation  ("Tremont"),  a  Delaware  corporation,   and  NL
Industries, Inc. ("NL"), a New Jersey corporation.

WHEREAS,  Tremont desires that NL provide certain services to Tremont, and
NL is willing to provide such services to Tremont  pursuant to the terms of this
Agreement.

NOW,  THEREFORE,  in  consideration of the premises and promises set forth
herein, the parties to this Agreement agree as follows:

1.    SERVICES   PROVIDED.   NL  will  make  available  to  Tremont  the
following services (the "Services"):

(a)   certain administration and management services with respect to
Tremont's insurance and risk management needs, including:

(i)   management  of  claims  (including  insured  and
self-insured   workers   compensation   and
liability claims);
(ii)  budgeting and related activities;
(iii) administration  of Tremont's  captive
insurance company;
(iv)  coordination of property loss
control program; and
(v)   administration   of  Tremont's   insurance
program,   excluding   all   employee
benefit and welfare related programs.

(b)   certain administration and management services with respect to
Tremont's real properties and interests.

(c)   consultation  and  assistance  in  performing  internal  audit
projects, as requested.

(d)   consultation    and   assistance   in   tax   management   and
administration, including, without limitation, preparation and
filing  of  tax  returns,   tax  reporting,   examinations  by
government authorities and tax planning.

(e)   certain executive secretarial and administrative services.

2. FEES FOR SERVICES AND  REIMBURSEMENT  OF EXPENSES.  During the Term (as
defined  below) of this  Agreement,  Tremont  shall  pay to NL an annual  fee of
$87,200 (the "Annual Fee") for the Services  described in paragraphs 1(a), 1(b),
1(d) and 1(e) above  payable in  quarterly  installments  of  $21,800,  plus all
out-of-pocket  expenses  incurred in  connection  with the  performance  of such
Services. In addition, Tremont will, within thirty (30) days after receipt of an
invoice (such invoices to occur no more  frequently  than once per month) pay to
NL an amount  equal to the  product  of $600  multiplied  by the  number of days
devoted by NL's internal auditors to providing  Services  described in paragraph
1(c) above times the number of internal  auditors  providing  such Services plus
all  out-of-pocket  expenses  incurred  in the  performance  of  such  Services.
Notwithstanding the foregoing, in the event that Tremont determines, in its sole
discretion,  that it no longer desires certain of the Services or NL determines,
in its sole  discretion,  that it no longer  desires to  provide  certain of the
Services, then Tremont or NL, as appropriate, shall provide the other party with
a ninety (90) day prior written notice of  cancellation  describing the Services
to be  terminated  or  discontinued  and Tremont  and NL during such  ninety-day
period shall agree to a pro-rata  reduction of the fees due  hereunder  for such
terminated or discontinued Services.

3. LIMITATION OF LIABILITY. In providing Services hereunder, NL shall have
a duty to act, and to cause its agents to act, in a reasonably  prudent  manner,
but  neither  NL nor any  officer,  director,  employee  or agent of NL shall be
liable to Tremont or its  subsidiaries  for any error of  judgment or mistake of
law or for any loss incurred by Tremont or its  subsidiaries  in connection with
the  matters to which  this  Agreement  relates,  except a loss  resulting  from
willful  misfeasance,  bad faith or gross  negligence  on the part of NL or from
NL's reckless disregard of obligations and duties under this Agreement.

4.  INDEMNIFICATION  OF NL BY TREMONT.  Tremont  shall  indemnify and hold
harmless NL, its  subsidiaries  and their  respective  officers,  directors  and
employees  from and against any and all losses,  liabilities,  claims,  damages,
costs and expenses (including  reasonable  attorneys' fees and other expenses of
litigation) to which such party may become subject  arising out of the provision
by NL to Tremont and its subsidiaries of any of the Services, provided that such
indemnity  shall not protect any such party  against any liability to which such
person would otherwise by subject by reason of willful  misfeasance,  bad faith,
gross negligence or reckless disregard of obligations and duties hereunder.

5. FURTHER ASSURANCE. Each of the parties will make, execute,  acknowledge
and  deliver  such  other  instruments  and  documents,  and take all such other
actions,  as the other party may  reasonably  request and as may  reasonably  by
required in order to effectuate  the purposes of this Agreement and to carry out
the terms hereof.

6. NOTICES. All communications  hereunder shall be in writing and shall be
addressed to:

If to NL:         NL Industries, Inc.
16825 Northchase Drive, Suite 1200
Houston, Texas 77060
Attention:  General Counsel

If to Tremont:    Tremont Corporation
1999 Broadway, Suite 4300
Denver, Colorado 80202
Attention:  General Counsel

or such other  address as the parties  shall have  specified
in writing.

7. AMENDMENT AND MODIFICATION.  Neither this Agreement nor any item hereof
may be changed,  waived,  discharged  or  terminated  other than by agreement in
writing signed by the parties hereto.

8.  SUCCESSORS AND ASSIGNS.  This Agreement  shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties hereto,
provided that this Agreement may not be assigned by either of the parties hereto
without the prior written consent of the other party.

9.  MISCELLANEOUS.  The  headings  contained  in  this  Agreement  are for
reference  purposes  only  and  shall  not  affect  in any  way the  meaning  or
interpretation  of  this  Agreement.   This  Agreement  constitutes  the  entire
agreement, and supersedes all prior agreements and understandings,  both written
and oral,  between the parties with respect to the subject matter  hereof.  This
Agreement  may be executed in one or more  counterparts,  each of which shall be
deemed an original,  and all of which together shall constitute one and the same
instrument.  This  Agreement  shall  be  governed  in  all  respects,  including
validity, interpretation and affect, by the laws of the State of Texas.

10. TERM OF AGREEMENT.  This Agreement shall be effective as of January 1,
1998,  and shall remain in effect for a term of one year until December 31, 1998
(the  "Term");  provided,   however,  the  Agreement  shall  be  extended  on  a
quarter-to-quarter  basis  after  the  expiration  of the  Term  unless  written
notification  is given by either  party thirty (30) days in advance of the first
day of each  successive  quarter or unless it is  terminated  or superseded by a
subsequent  written  agreement of the parties hereto.  Upon such  termination or
upon the  expiration  of this  Agreement,  the parties'  rights and  obligations
hereunder  shall  cease  and  terminate   except  with  respect  to  rights  and
obligations arising on or prior to the date of expiration or termination and the
rights and obligations arising under paragraph 4 above.

IN WITNESS  WHEREOF,  the parties have duly executed this  Agreement as of
the ____ day of July, 1998, which Agreement will be deemed to be effective as of
January 1, 1998.

NL INDUSTRIES, INC.

By:__________________________
Dennis G. Newkirk
Vice President

TREMONT CORPORATION

By:___________________________
J. Thomas Montgomery
Vice President

EXHIBIT 10.12

INTERCORPORATE SERVICES AGREEMENT

This INTERCORPORATE SERVICES AGREEMENT (the "Agreement") is made effective
as of January 1, 1998, by and between Titanium Metals Corporation  ("TIMET"),  a
Delaware corporation, and NL Industries, Inc. ("NL"), a New Jersey corporation.

WHEREAS, TIMET desires that NL provide certain insurance, risk management,
loss control,  internal audit, tax, and executive secretarial and administrative
services to TIMET, as set forth in this Agreement.

NOW,  THEREFORE,  in  consideration of the premises and promises set forth
herein and for other good and valuable consideration the receipt and sufficiency
of which is hereby acknowledged, the parties to this Agreement agree as follows:

1.    SERVICES  PROVIDED.  NL  will  make  available  to  TIMET  and its
subsidiaries the following services (the "Services"):

(a)   certain administration and management services with respect to
TIMET's insurance and risk management needs, including:

(i)   management  of claims  (including  insured
and  self-insured   workers   compensation
and liability claims);
(ii)  budgeting and related  activities;
(iii) coordination of property loss control
program; and
(iv)  administration of TIMET's insurance  program,  excluding
all employee benefit and welfare related programs.

(b)   consultation  and  assistance  in  performing  internal  audit
projects, as requested.

(c)   consultation    and   assistance   in   tax   management   and
administration, including, without limitation, preparation and
filing  of  tax  returns,   tax  reporting,   examinations  by
government authorities and tax planning.

(d)   certain executive secretarial and administrative services.

2. FEES FOR SERVICES AND  REIMBURSEMENT  OF EXPENSES.  During the Term (as
defined below) of the Agreement, TIMET shall pay to NL an annual fee of $335,000
for the Services  described in paragraphs  1(a), 1(c), and 1(d) above payable in
quarterly  installments of $83,750 plus all  out-of-pocket  expenses incurred in
connection with the performance of such Services. In addition, TIMET will pay to
NL within thirty (30) days after  receipt of an invoice (such  invoices to occur
no more  frequently  than once per month) an amount  equal to the product of 600
multiplied by the number of days devoted by NL's internal  auditors to providing
Services described in paragraph 1(b) above times the number of internal auditors
providing  such  Services  plus  all  out-of-pocket  expenses  incurred  in  the
performance of such Services.  Notwithstanding the foregoing,  in the event that
TIMET determines,  in its sole discretion,  that it no longer desires certain of
the Services or NL determines, in its sole discretion, that it no longer desires
to provide  certain of the  Services,  then TIMET or NL, as  appropriate,  shall
provide  the  other  party  with a  ninety  (90) day  prior  written  notice  of
cancellation  describing the Services to be terminated or discontinued and TIMET
and NL during such ninety-day period shall agree to a pro-rata  reduction of the
fees due hereunder for such terminated or discontinued Services.

3. LIMITATION OF LIABILITY. In providing Services hereunder, NL shall have
a duty to act, and to cause its agents to act, in a reasonably  prudent  manner,
but  neither  NL nor any  officer,  director,  employee  or agent of NL shall be
liable to TIMET or its  subsidiaries for any error of judgment or mistake of law
or for any loss incurred by TIMET or its  subsidiaries  in  connection  with the
matters to which this  Agreement  relates,  except a loss resulting from willful
misfeasance,  bad  faith or  gross  negligence  on the  part of NL or from  NL's
reckless disregard of obligations and duties under this Agreement.

4. INDEMNIFICATION OF NL BY TIMET. TIMET shall indemnify and hold harmless
NL, its subsidiaries and their respective officers, directors and employees from
and against any and all losses, liabilities, claims, damages, costs and expenses
(including reasonable attorneys' fees and other expenses of litigation) to which
such party may become  subject  arising out of the  provision by NL to TIMET and
its subsidiaries of any of the Services,  provided that such indemnity shall not
protect  any such  party  against  any  liability  to which  such  person  would
otherwise  be  subject  by reason  of  willful  misfeasance,  bad  faith,  gross
negligence or reckless disregard of obligations and duties hereunder.

5. FURTHER ASSURANCE. Each of the parties will make, execute,  acknowledge
and  deliver  such  other  instruments  and  documents,  and take all such other
actions,  as the other party may  reasonably  request and as may  reasonably  by
required in order to effectuate  the purposes of this Agreement and to carry out
the terms hereof.

6. NOTICES. All communications  hereunder shall be in writing and shall be
addressed to:

If to NL:         NL Industries, Inc.
16825 Northchase Drive, Suite 1200
Houston, Texas 77060
Attention:  General Counsel

If to TIMET:      Titanium Metals Corporation
1999 Broadway, Suite 4300
Denver, Colorado 80202
Attention:  General Counsel

or such other  address as the  parties  shall  have  specified  in
writing.

7. AMENDMENT AND MODIFICATION.  Neither this Agreement nor any item hereof
may be changed,  waived,  discharged  or  terminated  other than by agreement in
writing signed by the parties hereto.

8.  SUCCESSORS AND ASSIGNS.  This Agreement  shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties hereto,
provided that this Agreement may not be assigned by either of the parties hereto
without the prior written consent of the other party.

9.  MISCELLANEOUS.  The  headings  contained  in  this  Agreement  are for
reference  purposes  only  and  shall  not  affect  in any  way the  meaning  or
interpretation  of  this  Agreement.   This  Agreement  constitutes  the  entire
agreement, and supersedes all prior agreements and understandings,  both written
and oral,  between the parties with respect to the subject matter  hereof.  This
Agreement  may be executed in one or more  counterparts,  each of which shall be
deemed an original,  and all of which together shall constitute one and the same
instrument.  This  Agreement  shall  be  governed  in  all  respects,  including
validity, interpretation and affect, by the laws of the State of Texas.

10. TERM OF AGREEMENT.  This Agreement shall be effective as of January 1,
1998,  and shall remain in effect for a term of one year until December 31, 1998
(the  "Term");  provided,   however,  the  Agreement  shall  be  extended  on  a
quarter-to-quarter  basis  after  the  expiration  of the  Term  unless  written
notification  is given by either  party thirty (30) days in advance of the first
day of each  successive  quarter or unless it is  terminated  or superseded by a
subsequent  written  agreement of the parties hereto.  Upon such  termination or
upon the  expiration  of this  Agreement,  the parties'  rights and  obligations
hereunder  shall  cease  and  terminate   except  with  respect  to  rights  and
obligations arising on or prior to the date of expiration or termination and the
rights and obligations arising under paragraph 4 above.

IN  WITNESS  WHEREOF,  the  parties  have  duly  executed  this  Agreement
effective as of the _____ day of July,  1998,  which Agreement will be deemed to
be effective as of January 1, 1998.

NL INDUSTRIES, INC.

By:____________________________________
Dennis G. Newkirk
Vice President

TITANIUM METALS CORPORATION

By:____________________________________
J. Thomas Montgomery
Vice President

EXHIBIT 10.13

INTERCORPORATE SERVICES AGREEMENT

This INTERCORPORATE SERVICES AGREEMENT (the "AGREEMENT"),  effective as of
January 1, 1998,  amends and  supersedes  that certain  Intercorporate  Services
Agreement  effective  as of January 1, 1997 between NL  INDUSTRIES,  INC., a New
Jersey corporation ("NL"), and COMPX INTERNATIONAL INC., a Delaware  corporation
("RECIPIENT").

RECITALS

A. NL provides  Recipient  certain  occupancy and related office  services
(the "OCCUPANCY AND RELATED OFFICE SERVICES"),  which services include,  without
limitation,  office space that  Recipient's  personnel  currently occupy at NL's
corporate offices at Two Greenspoint  Plaza, 16825 Northchase Drive, Suite 1200,
Houston, Texas and mail, telecommunication,  computer support, copying and other
reasonable office services related to such occupancy.

B. The terms of this  Agreement  are no less  favorable to Recipient  than
could otherwise be obtained from a third party for comparable services.

C.  Recipient  desires to continue  receiving  the  Occupancy  and Related
Office Services  presently provided by NL and affiliates of NL and NL is willing
to continue to provide such services under the terms of this Agreement.

AGREEMENT

For and in  consideration  of the  mutual  premises,  representations  and
covenants herein contained, the parties hereto mutually agree as follows:

SECTION  1.  SERVICES  TO BE  PROVIDED.  NL  agrees to make  available  to
Recipient the following services (the "SERVICES") to be rendered by the internal
staff of NL and affiliates of NL:

(a)   the Occupancy and Related Office Services; and

(b) such other  services as may be  requested by Recipient or deemed
necessary and proper from time to time.

SECTION 2. MISCELLANEOUS  SERVICES. It is the intent of the parties hereto
that NL provide only the Services  requested  by  Recipient in  connection  with
routine administrative  functions related to the ongoing operations of Recipient
and not with  respect  to special  projects,  including  corporate  investments,
acquisitions and divestitures.  The parties hereto contemplate that the Services
rendered in  connection  with the conduct of  Recipient's  business will be on a
scale  compared to that existing on the effective date of this Agreement but not
for major corporate  acquisitions or  divestitures,  and that adjustments may be
required  to the terms of this  Agreement  in the event of such major  corporate
acquisitions,  divestitures or special projects. Recipient will continue to bear
all other costs required for outside  services,  and it is expressly  understood
that NL assumes no  liability  for any  expenses  or  services  other than those
stated in  SECTION 1. In  addition  to the fee paid to NL by  Recipient  for the
Services  provided  pursuant  to this  Agreement,  Recipient  will pay to NL the
amount of out-of-pocket costs incurred by NL in rendering such Services.

SECTION 3. FEE FOR  SERVICES..  Recipient  agrees to pay to NL  $10,937.50
quarterly, commencing as of January 1, 1998, pursuant to this Agreement.

SECTION 4. ORIGINAL  TERM.  Subject to the provisions of SECTION 5 hereof,
the original  term of this  Agreement  shall be from January 1, 1998 to December
31, 1998.

SECTION  5.   EXTENSIONS.   This   Agreement   shall  be   extended  on  a
quarter-to-quarter  basis  after the  expiration  of its  original  term  unless
written  notification is given by NL or Recipient thirty (30) days in advance of
the first  day of each  successive  quarter  or  unless  it is  superseded  by a
subsequent written agreement of the parties hereto.

SECTION 6. LIMITATION OF LIABILITY.  In providing its Services  hereunder,
NL shall  have a duty to act,  and to cause its agents to act,  in a  reasonably
prudent manner, but neither NL nor any officer,  director,  employee or agent of
NL or its  affiliates  shall be liable to Recipient for any error of judgment or
mistake of law or for any loss  incurred by  Recipient  in  connection  with the
matter to which this  Agreement  relates,  except a loss  resulting from willful
misfeasance, bad faith or gross negligence on the part of NL.

SECTION 7. INDEMNIFICATION OF NL BY RECIPIENT..  Recipient shall indemnify
and hold harmless NL, its affiliates and their  respective  officers,  directors
and employees from and against any and all losses, liabilities, claims, damages,
costs and expenses (including  attorneys' fees and other expenses of litigation)
to which such party may become  subject to arising out of the Services  provided
by NL to Recipient hereunder, PROVIDED that such indemnity shall not protect any
person against any liability to which such person would  otherwise be subject to
by reason of willful  misfeasance,  bad faith or gross negligence on the part of
such person.

SECTION 8. FURTHER  ASSURANCES.  Each of the parties  will make,  execute,
acknowledge and deliver such other instruments and documents,  and take all such
other actions,  as the other party may reasonably  request and as may reasonably
be required in order to effectuate  the purposes of this  Agreement and to carry
out the terms hereof.

SECTION 9. NOTICES.  All communications  hereunder shall be in writing and
shall  be  addressed,  if  intended  for NL,  to Two  Greenspoint  Plaza,  16825
Northchase Drive, Suite 1200, Houston,  Texas 77060,  Attention:  President,  or
such other  address as it shall have  furnished to Recipient in writing,  and if
intended for Recipient,  to Two Greenspoint Plaza, 16825 Northchase Drive, Suite
1200,  Houston,  Texas 77060,  Attention:  Chairman of the Board,  or such other
address as it shall have furnished to NL in writing.

SECTION 10.  AMENDMENT AND  MODIFICATION.  Neither this  Agreement nor any
term hereof may be  changed,  waived,  discharged  or  terminated  other than by
agreement in writing signed by the parties hereto.

SECTION 11.  SUCCESSORS AND ASSIGNS.  This Agreement shall be binding upon
and inure to the benefit of NL and Recipient and their respective successors and
assigns,  except that neither  party may assign its rights under this  Agreement
without the prior written consent of the other party.

SECTION  12.  GOVERNING  LAW. This  Agreement  shall be governed by, and
construed and interpreted in accordance with, the laws of the state of Texas.

IN WITNESS  WHEREOF,  the parties  hereto have caused this Agreement to be
duly executed and delivered as of the date first above written.

NL INDUSTRIES, INC.

By:
J. LANDIS MARTIN
PRESIDENT   AND  CHIEF   EXECUTIVE
OFFICER

COMPX INTERNATIONAL INC.

By:
JOSEPH S. COMPOFELICE
CHAIRMAN  OF THE  BOARD  AND CHIEF
EXECUTIVE OFFICER

WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

EXHIBIT 27.1

<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM NL
INDUSTRIES INC.'S CONSOLIDATED FINANCIAL STATEMENTS FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 1998, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
CONSOLIDATED FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000

<PERIOD-TYPE>                   9-MOS
<FISCAL-YEAR-END>                          DEC-31-1998
<PERIOD-START>                             JAN-01-1998
<PERIOD-END>                               SEP-30-1998
<CASH>                                         320,823
<SECURITIES>                                         0
<RECEIVABLES>                                  149,645
<ALLOWANCES>                                     2,523
<INVENTORY>                                    191,568
<CURRENT-ASSETS>                               689,155
<PP                                         834,304
<DEPRECIATION>                                 454,275
<TOTAL-ASSETS>                               1,297,255
<CURRENT-LIABILITIES>                          452,349
<BONDS>                                        304,060
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                         8,355
<OTHER-SE>                                     138,015
<TOTAL-LIABILITY-AND-EQUITY>                 1,297,255
<SALES>                                        685,794
<TOTAL-REVENUES>                               706,563
<CGS>                                          476,026
<TOTAL-COSTS>                                  476,026
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                 (131)
<INTEREST-EXPENSE>                              46,917
<INCOME-PRETAX>                                 85,283
<INCOME-TAX>                                    14,174
<INCOME-CONTINUING>                             71,073
<DISCONTINUED>                                 287,396
<EXTRAORDINARY>                                (4,766)
<CHANGES>                                            0
<NET-INCOME>                                   353,703
<EPS-PRIMARY>                                     6.89
<EPS-DILUTED>                                     6.80