TITANIUM METALS CORP
PURCHASE AND SALE AGREEMENT THE BOEING COMPANY
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>exhibit102.txt
<DESCRIPTION>PURCHASE AND SALE AGREEMENT THE BOEING COMPANY
<TEXT>

6-5668-DAS/97-019  Rev. 1


                                   ----------

                           PURCHASE AND SALE AGREEMENT
                             (for titanium products)
                                   ----------


                THE BOEING COMPANY, acting through its division,
                           BOEING COMMERCIAL AIRPLANES

                                       and

                           TITANIUM METALS CORPORATION

                                   ----------


                                November 5, 1997
                  Amended and Restated Effective April 19, 2001


                                   ----------











* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     THIS PURCHASE AND SALE AGREEMENT,  originally dated as of November 5, 1997,
and amended and restated  effective April 19, 2001, is by and between THE BOEING
COMPANY,   a  Delaware   corporation  with  its  principal  office  in  Seattle,
Washington,  acting by and through its  division,  BOEING  COMMERCIAL  AIRPLANES
f/k/a  Boeing  Commercial   Airplane  Group  ("Boeing"),   and  TITANIUM  METALS
CORPORATION,  a  Delaware  corporation  with its  principal  office  in  Denver,
Colorado ("TIMET").

         The parties hereto agree as follows:

1.   DEFINITIONS.  Except as otherwise expressly provided in this Agreement, the
     following  defined  terms shall have the meanings set forth below when used
     herein:

1.1  "Annual Payment" has the meaning given such term in Section 3.6.

1.2  "Boeing" means The Boeing Company,  a Delaware  corporation,  acting by and
     through its division,  Boeing Commercial Airplanes (f/k/a Boeing Commercial
     Airplane Group). For purposes of this Agreement, the term "Boeing" includes
     only Boeing  Commercial  Airplanes and does not include any other division,
     subsidiary or affiliate of The Boeing Company.

1.3  "Boeing On-Time Delivery Rate" means, [ * ]

1.4  "Boeing  Recognized  Subcontractor"  means any  subsidiary  or affiliate of
     Boeing and any supplier to Boeing  (whether  direct or indirect) of forged,
     cast, extruded,  fabricated,  or any other titanium parts or assemblies for
     use in  fixed  wing,  commercial  aircraft  manufactured  by  Boeing  which
     satisfies  the  requirements   contained  in  Article  22  hereof.   Boeing
     Recognized  Subcontractors  will be entitled to  purchase  Boeing  Titanium
     Products  under the terms and subject to the  conditions of this  Agreement
     either directly from TIMET or through Boeing's Agent.

1.5  "Boeing  Titanium  Product" means a titanium product of the type enumerated
     on Schedule 1 (as amended,  revised or supplemented from time to time) that
     is  ordered  or  purchased  by a  Purchaser  from  TIMET  pursuant  to this
     Agreement  for use in  manufacturing  parts or  assemblies  for fixed wing,
     commercial aircraft manufactured by Boeing.

1.6  "Boeing's  Agent" means an entity that has been  designated  by Boeing from
     time to time to manage the purchasing of Boeing Titanium Products on behalf
     of Boeing.

1.7  "Calendar  Quarter" means each of the three-month  periods ending March 31,
     June 30, September 30, and December 31.

1.8  "Confidential Information" means confidential or proprietary information of
     the Disclosing  Party  furnished to the Receiving  Party in connection with
     this Agreement, including without limitation,  technical information in the
     form  of  designs,  concepts,   requirements,   specifications,   software,
     interfaces,  components,  processes,  or the like, and which, if in visual,
     written or graphic form, is clearly and conspicuously identified thereon as
     "confidential" or "proprietary" or, if in oral form, is confirmed  promptly
     thereafter in writing as "confidential" or "proprietary." The provisions of
     this Section 1.8 and Article 11 shall not apply to, and the Receiving Party
     shall not be  obligated  to hold in  confidence  pursuant  to  Article  11,
     information which:

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


     (a)  was  in  the  lawful   possession  of  the  Receiving   Party  without
          confidentiality  restrictions  prior to its receipt  thereof  from the
          Disclosing Party;

     (b)  is or becomes  public  knowledge  without  the fault of the  Receiving
          Party;

     (c)  is or becomes  available  to the  Receiving  Party on an  unrestricted
          basis from a source having a right to make such disclosure;

     (d)  is made  available  on an  unrestricted  basis to a third party by the
          Disclosing Party; or

     (e)  is  developed  by the  Receiving  Party  independent  of  Confidential
          Information received under Article 11.

1.9  "Disclosing Party" means Boeing or TIMET, as the case may be, communicating
     Confidential  Information  to the  other  party  in  connection  with  this
     Agreement.

1.10 "Equivalent  Government  Authority"  means  those  government  agencies  so
     designated  by the FAA or those  agencies  of  governments  other  than the
     United States that have responsibility for assuring aircraft airworthiness.

1.11 "FAA" means the Federal Aviation Administration or any successor government
     agency.

1.12 "Lead Time  Schedule"  has the  meaning  given  such term in  Section  4.3.

1.13 "Material  Default  in  Performance"  has the  meaning  given  such term in
     Section 6.3.

1.14 "Order" means a purchase  order for Boeing  Titanium  Products  placed by a
     Purchaser with TIMET for use in manufacturing parts or assemblies on behalf
     of Boeing  (directly or  indirectly),  to the limited  extent such purchase
     order  has been  accepted  in  writing  by TIMET or is  deemed to have been
     accepted by TIMET pursuant to the Terms & Conditions.

1.15 "Purchaser"  means the person,  either  Boeing,  Boeing's Agent or a Boeing
     Recognized Subcontractor,  that is the purchasing party pursuant to a given
     Order.

1.16 "Quarterly Volume Forecast" has the meaning given such term in Section 4.3.

1.17 "Receiving  Party"  means  Boeing  or  TIMET,  as the case may be,  to whom
     Confidential  Information is  communicated by the other party in connection
     with this Agreement.

1.18 "Representatives" of a given party means its directors,  its officers,  and
     employees.

1.19 "Terms & Conditions" means the Terms and Conditions of Purchase and Sale of
     Boeing Titanium Products attached hereto as Exhibit A.

1.20 "TIMET" means Titanium Metals Corporation, a Delaware corporation.

                                      -2-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

2.   PURCHASE AND SALE OF BOEING TITANIUM PRODUCTS.

2.1  On the terms and subject to the conditions of this Agreement, including the
     Terms & Conditions, Boeing shall have the right, but not the obligation, to
     purchase Boeing Titanium Products,  either directly,  or indirectly through
     Boeing's  Agent or  through  Boeing  Recognized  Subcontractors,  and TIMET
     agrees to sell Boeing  Titanium  Products to Boeing,  either  directly,  or
     indirectly to Boeing's Agent or to Boeing Recognized Subcontractors, in the
     volumes and at the prices set forth herein.

2.2  Such purchases and sales of Boeing  Titanium  Products shall be made by the
     placement  of an Order by  Boeing,  Boeing's  Agent or a Boeing  Recognized
     Subcontractor  directly with TIMET,  as provided in the Terms & Conditions.
     TIMET  shall not be  obligated  to accept any Order that (a)  contains  any
     terms  inconsistent  with the  Terms &  Conditions  or (b) as  provided  in
     Section 4.5 below; TIMET shall be obligated to accept all other Orders.

2.3  Boeing Titanium  Products  purchased  hereunder are intended for use in the
     manufacture  of parts or  assemblies  for fixed wing,  commercial  aircraft
     produced by Boeing,  and may not be used by any  Purchaser for any purpose,
     other  than for the  manufacture  of parts or  assemblies  for fixed  wing,
     commercial  aircraft  produced  by Boeing or resold to any other  person or
     entity  except for the purpose of  manufacturing  parts or  assemblies  for
     fixed wing, commercial aircraft produced by Boeing.

3.   PRICING.

3.1  The prices for Boeing  Titanium  Products  delivered  through [ * ] are set
     forth on Schedule 1. Pricing for Boeing Titanium  Products not specifically
     identified  in Schedule 1 will be  established  by the mutual  agreement of
     Boeing and TIMET  applying  the ingot price per pound and  margins  used in
     developing  Schedule 1. Any such additional  prices will be evidenced by an
     amended  Schedule 1 agreed to in writing  by both  Boeing and TIMET,  which
     shall  thereupon  become  the  new  Schedule  1 to  this  Agreement  and be
     substituted  for the  existing  Schedule 1 in the Terms &  Conditions  with
     respect to any Order placed after such date.

3.2  Except as identified  in Section 3.5 below,  for Boeing  Titanium  Products
     ordered  for  delivery  on or after [ * ],  pricing  is  subject  to annual
     adjustment, up or down, based upon the following formula:

     [ * ]

     where:

     [ * ]

3.3  No later than [ * ] of each year,  commencing  in 2002,  TIMET will provide
     Boeing,  Boeing's  Agent  and each  Boeing  Recognized  Subcontractor  with
     TIMET's determination of the change in pricing for Boeing Titanium Products
     resulting from the application of the formula set forth in Section 3.2. The
     resulting pricing change will become effective for Boeing Titanium

                                       -3-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>



     Products delivered on and after January 1 and on or prior to December 31 of
     the following year. To memorialize this  adjustment,  TIMET shall prepare a
     revised  Schedule 1 reflecting such  adjustments,  which revised Schedule 1
     shall  thereupon  become the new Schedule 1 to this  Agreement  and will be
     provided to Boeing, Boeing's Agent and each Boeing Recognized Subcontractor
     (as applicable to a given Boeing Recognized Subcontractor).

3.4  The  parties  recognize  that  pricing  for a given year with  respect to a
     particular  Boeing  Titanium  Product  may also be  subject  to  reduction,
     independent  of any adjustment  resulting  from the  application of Section
     3.2, based upon the results of Lean Manufacturing initiatives undertaken by
     the parties in  accordance  with Article 5 of this  Agreement,  as any such
     reductions are agreed upon by Boeing and TIMET in writing.

3.5  [ * ]

3.6  For each year of this Agreement, beginning on January 1, 2002, Boeing shall
     pay TIMET  $28,500,000.00 (the "Annual Payment") for the right, but not the
     obligation, to purchase up to 7.5 million pounds of Boeing Titanium Product
     annually  from TIMET at the pricing  set forth in  Sections  3.1 though 3.5
     MINUS $3.80 per pound.  Such $3.80 per pound reduction in the pricing shall
     be  calculated  and  credited as set forth in Section 3.7 or 3.8 below,  as
     applicable. For the year 2002, the Annual Payment shall be made to TIMET on
     or prior to [ * ]. For the years 2003  through  2007,  the  Annual  Payment
     shall be made to TIMET on or prior to the [ * ]of each such year.

3.7  For each pound of titanium  purchased by Boeing or Boeing's  Agent (but not
     by a Boeing  Recognized  Subcontractor)  pursuant to this  Agreement  after
     January 1, 2002,  TIMET shall  invoice  Boeing  pursuant  to  Sections  3.1
     through 3.5, reflecting the total price calculated as set forth in Sections
     3.1 through 3.5, less the $3.80 per pound credit described in Section 3.6.

3.8  For each pound of titanium  purchased by a Boeing Recognized  Subcontractor
     pursuant to this  Agreement  after January 1, 2002,  and invoiced  directly
     from TIMET to that Boeing  Recognized  Subcontractor,  TIMET shall  invoice
     such Boeing  Recognized  Subcontractor the price calculated as set forth in
     Sections 3.1 through 3.5 above.  TIMET shall account to Boeing for all such
     invoices,  and Boeing shall  deduct from the next Annual  Payment an amount
     equal to the  product of all such  pounds  purchased  by Boeing  Recognized
     Subcontractors  in such  calendar  year and $3.80 per pound.  (For all such
     invoices for which TIMET's accounting has not been completed by December 31
     of a calendar  year,  TIMET shall complete the accounting for such calendar
     year and reimburse  Boeing, no later than [ * ] of the next year, an amount
     equal  to  the  product  of  all  pounds  purchased  by  Boeing  Recognized
     Subcontractors  reflected on those unaccounted for invoices,  and $3.80 per
     pound.)  For the year [ * ], TIMET  shall  repay to  Boeing,  no later than
     March 15, 2008, an amount equal to the product of all such pounds purchased
     by Boeing Recognized Subcontractors in [ * ] and $3.80 per pound. Repayment
     for any pounds purchased by Boeing  Recognized  Subcontractors in [ * ] but
     invoiced  after [ * ]  shall  be made to  Boeing  within  [ * ] of  TIMET's
     invoicing of the Boeing Recognized Subcontractor.

3.9  Sections  3.7 and 3.8  taken  together  shall  not  apply to more  than 7.5
     million  pounds per calendar  year or the number of pounds for any Calendar
     Quarter  identified  as the  maximum  volume for such  Calendar  Quarter on
     Exhibit B hereto  (except as TIMET may otherwise  agree pursuant to

                                       -4-

* Certain information,  indicated by [ * ] has been omitted and filed separately
with the Securities  and Exchange  Commission.  Confidential  treatment has been
requested with respect to such omitted portions.
<PAGE>

     Section  3.12).  The  amounts  to be  credited,  deducted  or repaid  under
     Sections  3.7  and 3.8  taken  together  shall  not  exceed  the  total  of
     $28,500,000.00 allocable to any calendar year.

3.10 (a)  A Boeing  Titanium  Product shall be deemed to have been  purchased in
          the Calendar  Quarter in which it was scheduled for delivery,  as last
          mutually  agreed upon by TIMET and  Purchaser  (regardless  of whether
          shipped by TIMET during such  Calendar  Quarter);  provided,  that, if
          payment for any Boeing Titanium  Product ordered by Boeing or Boeing's
          Agent (but not a Boeing Recognized  Subcontractor) is not subsequently
          made by Boeing or  Boeing's  Agent,  the  volume  (in  pounds) of such
          Boeing  Titanium  Product  will be  deducted  from the volumes for the
          Calendar  Quarter in which it was  originally  credited;  and provided
          further,  that if such  Boeing  Titanium  Product is  returned  by any
          Purchaser to TIMET with TIMET's permission (other than Boeing Titanium
          Product that is  rightfully  rejected for product  deficiencies),  the
          volume (in pounds)  representing  such Boeing Titanium Product will be
          deducted from the purchased  volume for the Calendar  Quarter in which
          it was originally  credited and, if replaced,  be included in whatever
          subsequent Calendar Quarter such replacement material is delivered;

     (b)  Boeing Titanium  Products with respect to which an Order is terminated
          in  accordance  with Section  11.3 of the Terms & Conditions  shall be
          counted  only in an amount  equal to the  relevant  volume (in pounds)
          times  the   percentage  of  applicable   price  actually  paid  as  a
          termination  charge in  accordance  with  Section  11.3 of the Terms &
          Conditions; and

     (c)  Any substitute  titanium product purchased by a Purchaser  pursuant to
          Section  12.2(b) of the Terms & Conditions  upon the  occurrence  of a
          TIMET  Event of Default  (as  defined  in Section  12.1 of the Terms &
          Conditions)  shall be counted as though  such  volume (in  pounds) had
          actually been  purchased by that Purchaser from TIMET pursuant to this
          Agreement in the Calendar  Quarter in which  Purchaser  takes delivery
          thereof  provided TIMET has been furnished with written notice of such
          event.

3.11 For any Boeing  Titanium  Products  for which the  originally  agreed  upon
     delivery date is in calendar year [ * ] and with respect to which Purchaser
     and TIMET  mutually  agree upon a new delivery date in calendar year [ * ],
     the provisions of Sections 3.7 and 3.8 shall nonetheless apply.

3.12 With  respect  to any given  calendar  year,  TIMET  shall be  entitled  to
     withdraw  from the Annual  Payment an amount equal to $3.80 per pound times
     the  difference  between 7.5  million  pounds and the volume (in pounds) of
     Boeing Titanium Products purchased under the Agreement during such calendar
     year,  as such  volume  is  actually  determined  and  certified  to Boeing
     pursuant to Section  3.13.  In addition,  if, as of the end of any Calendar
     Quarter  during such calendar year, it would be  mathematically  impossible
     for Boeing, Boeing's Agent and Boeing Recognized Subcontractors to purchase
     (in the aggregate) the full 7.5 million pounds of Boeing Titanium  Products
     in the  remaining  part of such  calendar  year (based upon what they would
     then be entitled to purchase under this  Agreement  taking into account the
     quarterly limits for the remaining  Calendar Quarters in such calendar year
     as set forth in  Exhibit B plus any  amounts  that  TIMET may  permit to be
     purchased over such limits,  in its sole  discretion),  TIMET shall at such
     time be  entitled to withdraw  from the Annual  Payment an amount  equal to

                                      -5-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     $3.80 per pound times the  difference  between  7.5 million  pounds and the
     maximum  volume  (in  pounds)  that  Boeing and other  Purchasers  are then
     entitled to purchase  during the  remainder of the calendar  year under the
     Agreement based upon such quarterly limits, plus any amounts that TIMET may
     permit to be  purchased  over such  limits,  in its sole  discretion.  Once
     withdrawn by TIMET under this provision, such funds shall not be subject to
     future crediting to Boeing under Sections 3.6 through 3.8 hereof,  provided
     no errors have been made in  accounting  for the crediting due Boeing under
     this Section 3.

3.13 No later  than March 1 of each year from 2002  through [ * ],  TIMET  shall
     certify to Boeing the volume of Boeing Titanium  Products  purchased by all
     Purchasers  under this  Agreement  in the  preceding  calendar  year.  Such
     certification shall be subject to audit by or on behalf of Boeing,  through
     examination of the relevant records of TIMET, upon reasonable notice during
     normal business  hours.  Any such audit shall be conducted at Boeing's sole
     cost and expense.

4.   VOLUMES.

4.1  Based upon  making the Annual  Payment,  Boeing has the right,  but not the
     obligation  to purchase,  either  directly or indirectly  through  Boeing's
     Agent or through Boeing Recognized  Subcontractors,  up to a maximum of 7.5
     million pounds of Boeing Titanium Products per calendar year.

4.2  The matrix  attached  hereto as Exhibit B sets forth the maximum volumes of
     Boeing  Titanium  Products  that  Boeing,  Boeing's  Agent  and all  Boeing
     Recognized  Subcontractors  may  purchase  hereunder  in a  given  Calendar
     Quarter and in any calendar  year, as well as limitations on the percentage
     of such Boeing Titanium Products that may be represented by ingot.


4.3  By the last day of each Calendar Quarter,  Boeing will provide TIMET with a
     rolling forecast by quarter (the "Quarterly Volume Forecast")  representing
     Boeing's  best  estimate  of the needs for  Boeing  Titanium  Products  (by
     product  and  grade)  for [ * ] TIMET  will from time to time  prepare  and
     distribute to Boeing and each Boeing Recognized  Subcontractor a chart (the
     "Lead  Time  Schedule")  listing  by  product  and grade the lead times for
     Boeing  Titanium  Products then  applicable  to Orders (as  applicable to a
     given Boeing Recognized Subcontractor).

4.4  Upon completion of a Proprietary Information Agreement in a form reasonably
     acceptable  to Boeing,  Boeing shall from time to time  provide  TIMET with
     Boeing's  aircraft  delivery rate  forecast  ("skyline  chart"),  including
     periodic revisions thereto, as and when published.

4.5  Unless otherwise  agreed by TIMET in writing,  TIMET shall not be obligated
     to accept any Order which:

     (a)  would  represent  a volume in excess of the  limitations  set forth in
          Note (b) or (c) to the matrix attached as Exhibit B;

     (b)  contains a proposed  delivery  date that  represents  a lead time less
          than the lead time reflected for such Boeing  Titanium  Product in the
          Lead Time  Schedule  applicable at the time the Order is being placed.
          TIMET will consult with Boeing in the event it receives  such an Order
          and is unable to resolve  the  delivery  date to the  satisfaction  of

                                       -6-

* Certain information,  indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been

<PAGE>

          requested with respect to such omitted portions. Boeing's Agent or the
          Boeing  Recognized  Subcontractor  so that  Boeing  may  consider  its
          scheduling requirements and, if appropriate, request adjustment in the
          scheduling of other outstanding  Orders to accommodate this particular
          Order  requiring  expedited  delivery.  Any such  request by Boeing to
          delay another Order to meet its  requirements  shall  conclusively  be
          deemed to represent the  agreement to such delay by Boeing's  Agent or
          the Boeing  Recognized  Subcontractor  that is a party to such delayed
          Order.   TIMET  will  use  all  commercially   reasonable  efforts  to
          accommodate any such rescheduling requested by Boeing;

     (c)  is placed by an entity other than Boeing,  Boeing's  Agent or a Boeing
          Recognized Subcontractor;

     (d)  is for a use other than  manufacturing  parts or assemblies  for fixed
          wing, commercial aircraft produced by Boeing; or

     (e)  is for [ * ]

5.   LEAN MANUFACTURING PROCESS IMPROVEMENT.

5.1  Boeing and TIMET agree to work  together to identify  areas of  improvement
     which affect the  manufacturing  and assembly  process at TIMET's  facility
     and/or  TIMET's  subcontractor's  facilities.  Where  Boeing  and TIMET can
     identify  areas of  improvement,  the parties will  determine the amount of
     savings which will result from the improvements and share the benefits. Any
     such agreement regarding the sharing of savings or cost benefits will be in
     writing and executed on behalf of both Boeing and TIMET.

6.   TERM; TERMINATION.

6.1  Unless  otherwise  terminated in accordance with another  provision of this
     Article 6, this Agreement shall expire on [ * ].

6.2  This Agreement may be terminated prior to [ * ] as follows:

     (a)  by Boeing upon not less than sixty (60) days prior  written  notice to
          TIMET in the event [ * ]

     (b)  by Boeing by written  notice to TIMET in the event of any other breach
          by TIMET of this  Agreement  in any  material  respect,  which  breach
          continues  unremedied for more than [ * ] following  written notice of
          such breach by Boeing to TIMET;

     (c)  by TIMET by  written  notice to  Boeing in the event of any  breach by
          Boeing  of  this  Agreement  in any  material  respect,  which  breach
          continues  unremedied for more than [ * ] following  written notice of
          such breach by TIMET to Boeing; or

     (d)  by either  party by written  notice to the other party in the event of
          the  suspension,  dissolution  or  winding-up  of  the  other  party's
          business,  the other party's admission in writing of its insolvency or
          inability  to pay its debts as they become  due,  the  institution  of
          reorganization,  bankruptcy, liquidation, or other such proceedings by
          the  other  party,

                                      -7-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

          the institution of reorganization,  bankruptcy,  liquidation, or other
          such proceedings  against the other party which remain undismissed for
          more than [ * ], the appointment of a custodian, trustee, receiver, or
          similar  person for the other party's  properties  or business,  or an
          assignment by the other party for the benefit of its creditors.

6.3  [ * ]

6.4  The  provisions of Sections 3.7, 3.8 and 3.11 shall survive the  expiration
     of  this  Agreement  for the  purpose  of  making  determinations  and,  if
     applicable,  payment  thereunder  with respect to calendar  year [ * ]. The
     provisions of Article 11 shall survive the  expiration  or  termination  of
     this Agreement for the duration of the confidentiality  period set forth in
     Section 11.2.

6.5  The  termination  of  this  Agreement  shall  not  affect  the  rights  and
     responsibilities  of the parties  with  respect to any breach that may have
     occurred  prior  to such  termination.  Further,  the  termination  of this
     Agreement  shall not affect the rights and  obligations of the parties with
     respect  to any  uncompleted  Order  outstanding  as of the  date  of  such
     termination.

6.6  IN NO EVENT SHALL BOEING OR TIMET BE LIABLE  PURSUANT TO THIS  AGREEMENT OR
     ANY ORDER FOR INDIRECT,  SPECIAL,  CONSEQUENTIAL,  PUNITIVE,  OR INCIDENTAL
     DAMAGES, WHETHER ARISING UNDER CONTRACT, WARRANTY, TORT, NEGLIGENCE, STRICT
     LIABILITY, OR OTHER THEORY OF LIABILITY,  INCLUDING WITHOUT LIMITATION, ANY
     DAMAGES FOR LOSS OF PROFITS OR LOSS OF USE.

7.   INTEGRITY IN PROCUREMENT.

7.1  Boeing's  policy is to maintain high standards of integrity in procurement.
     Boeing's  employees  must ensure that no  favorable  treatment  compromises
     their  impartiality  in  the  procurement  process.  Accordingly,  Boeing's
     employees must strictly  refrain from  soliciting or accepting any payment,
     gift,  favor,  or thing of value which  could  improperly  influence  their
     judgment  with  respect to either  issuing an Order or  administering  this
     Agreement.  Consistent  with this  policy,  TIMET  agrees not to provide or
     offer to provide any employees of Boeing any payment, gift, favor, or thing
     of value for the purposes of  improperly  obtaining or rewarding  favorable
     treatment  in  connection  with any Order or this  Agreement.  TIMET  shall
     conduct  its own  procurement  practices,  and require  that its  suppliers
     conduct their procurement practices,  consistently with these standards. If
     TIMET has  reasonable  grounds  to believe  that this  policy may have been
     violated,  TIMET shall  promptly  report  such  possible  violation  to the
     appropriate Director of Materiel or Ethics Advisor of Boeing.

8.   INFRINGEMENT.

8.1  Except as provided in Section 8.2 below, TIMET shall indemnify, defend, and
     save  Boeing  and  Boeing's  customers  harmless  from all  claims,  suits,
     actions,   awards  (including   without   limitation,   awards  based  upon
     intentional  infringement  of  patents  known  to TIMET at the time of such
     infringement,  exceeding actual damages,  and/or including  attorneys' fees
     and/or costs), liabilities,  damages, attorneys' fees, and costs related to
     the  actual  or  alleged  infringement  of any  United  States  or  foreign
     intellectual  property right (including without limitation,  any right in a
     patent,  copyright,  industrial design or semiconductor mask work, or based
     on

                                      -8-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     misappropriation  or wrongful use of  information or documents) and arising
     out of the manufacture,  sale, or use of Boeing Titanium Products by Boeing
     or Boeing's customer. Boeing shall promptly notify TIMET of any such claim,
     suit,  or action,  and TIMET shall,  at its own expense,  fully defend such
     claim, suit, or action on behalf of Boeing and/or Boeing's customer, as the
     case may be. For purposes of this Section 8.1, the term "Boeing's customer"
     shall not include the United States  Government and the term "Boeing" shall
     include The Boeing Company and all of its  subsidiaries  and the respective
     officers, agents, and employees of each.

8.2  Section  8.1 shall not apply in the case of,  and Boeing  shall  indemnify,
     defend,  and save TIMET harmless from all claims,  suits,  actions,  awards
     (including without limitation,  awards based upon intentional  infringement
     of  patents  known to  Boeing at the time of such  infringement,  exceeding
     actual   damages,   and/or   including   attorneys'   fees  and/or  costs),
     liabilities,  damages,  attorneys' fees, and costs related to the actual or
     alleged infringement of any United States or foreign intellectual  property
     right  (including  without  limitation,  any right in a patent,  copyright,
     industrial design or semiconductor mask work, or based on  misappropriation
     or wrongful use of information or documents) when such infringement  arises
     from:

     (a)  TIMET's  compliance with formal  specifications  issued by Boeing when
          infringement  could not  reasonably be avoided in complying  with such
          specifications; or

     (b)  the use or sale of Boeing Titanium  Products in combination with other
          items when such  infringement  would not have occurred from the use or
          sale of those  Boeing  Titanium  Products  solely for the  purpose for
          which they were designed or sold by TIMET.

         For purposes of this Section 8.2, the term "TIMET" shall include
         Titanium Metals Corporation and all of its subsidiaries and the
         respective officers, agents, and employees of each.

9.   PUBLICITY.


9.1  This Agreement is  confidential  and shall not be disclosed by any party or
     its  agents  or  representatives  to any  person  (excluding  the  parties'
     directors and employees  having a need to know) other than as disclosure is
     required by applicable law, regulation or court order;  provided,  however,
     that either party may make  disclosure of this  Agreement to (a) any of its
     accountants,  auditors  or lawyers  having a need to know such  information
     provided  such person agrees not to disclose the  information  to any other
     person or  outside  of such  firm,  except as  disclosure  is  required  by
     applicable  law,  regulation  or court  order and (b) any of its bankers or
     credit rating  agencies  having a need to know such  information,  provided
     persons at such companies  agree in writing not to disclose the information
     to any other person or outside of such  company,  except as  disclosure  is
     required by applicable law,  regulation or court order. The foregoing shall
     not apply to  matters  already  public  other than by reason of a breach of
     this Section 9.1. Except as may be otherwise agreed in writing, without the
     prior written approval of the other,  neither Boeing nor TIMET will use, or
     cause or permit to be used, the Boeing or TIMET name or any Boeing or TIMET
     trademark  in any  form of  promotion  or  publicity.  Notwithstanding  the
     foregoing,  Boeing agrees that TIMET may issue the press release (described
     in that Settlement  Agreement and Release of Claims dated April 19, 2001 by
     and between the parties,  in the form last provided by TIMET to Boeing) and
     may discuss the

                                      -9-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     matters  contained  therein  in  investor  calls only as such  matters  are
     specifically stated in the press release.


10.  SCRAP RECYCLING PROGRAM.

10.1 The parties intend, by separate agreement, to enter into an arrangement for
     the  recycling  of scrap by Boeing to TIMET;  provided,  however,  that any
     failure  of the  parties to reach  such an  agreement  shall not affect the
     validity or effect of this Agreement.

11.  CONFIDENTIALITY.

11.1 The parties  will not  identify  information  as  Confidential  Information
     unless the Disclosing  Party believes that such  information is proprietary
     to, or  constitutes a trade secret of, the  Disclosing  Party.  The parties
     will attempt to limit the exchange of Confidential Information to only that
     Confidential Information necessary for the purposes of this Agreement.

11.2 The parties  agree that,  for a period of [ * ] from the date of receipt of
     Confidential  Information,  without the prior written  consent of the other
     party  hereto and except as may be required  by law,  the  Receiving  Party
     shall hold in confidence and not disclose Confidential Information received
     by it, except to (a)  Representatives  of the  Receiving  Party who require
     such Confidential  Information for purposes of this Agreement and who agree
     to hold such Confidential  Information in confidence in accordance with the
     terms of this  Agreement and (b)  Purchasers  of the Receiving  Party whose
     involvement is required by the Receiving  Party for purposes of these Terms
     &  Conditions  and who  agree  to hold  such  Confidential  Information  in
     confidence in accordance with the terms of this Agreement.

11.3 Confidential  Information  shall not be used by the Receiving Party (or any
     Representative  to whom the Receiving  Party  discloses  such  Confidential
     Information) except for the purposes contemplated in this Agreement.

11.4 The Receiving  Party will be deemed to have  satisfied its  obligations  of
     confidentiality and non-use hereunder if it uses reasonable care to protect
     against  unauthorized  disclosure  or  misuse of  Confidential  Information
     received by it hereunder,  which care shall not be less than the care taken
     by the  Receiving  Party to protect  its own  confidential  or  proprietary
     information  from  disclosure  or  use by  others.  Upon  discovery  of any
     accidental  disclosure  or  misuse,  the  Receiving  Party  shall  take all
     reasonable  steps to recover or limit further  misuse of such  Confidential
     Information.

11.5 The Receiving Party will copy Confidential  Information received by it only
     as reasonably necessary for the purposes contemplated in this Agreement.

11.6 The Receiving Party agrees to return to the Disclosing  Party all copies of
     written Confidential  Information  received pursuant to this Agreement,  as
     well as all  copies  made  thereof  or written  materials  prepared  by the
     Receiving Party  containing  Confidential  Information,  within thirty (30)
     calendar  days of the written  demand of the  Disclosing  Party;  provided,
     however,  that  the  Receiving  Party  may  retain  a  single  copy  of all
     Confidential  Information received for purposes of establishing  compliance
     with the terms of this  Agreement,  which copy shall be segregated

                                      -10-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


     from the normal business  records of the Receiving Party and held in strict
     confidence in accordance with the terms of this Agreement.

11.7 If the  Receiving  Party  or any of  its  Representatives  becomes  legally
     compelled (by deposition,  interrogatory,  request for documents, subpoena,
     civil  investigative  demand or similar  process)  to  disclose  any of the
     Confidential Information,  the Receiving Party will advise and consult with
     the Disclosing Party prior to any such  disclosure,  so that the Disclosing
     Party may seek a protective order or other appropriate  remedy and/or waive
     compliance with this Agreement. If such protective order or other remedy is
     not obtained,  or compliance  with this  Agreement is waived as above,  the
     Receiving  Party  will  disclose  only  that  portion  of the  Confidential
     Information  which the  Receiving  Party is  advised  by counsel is legally
     required and the Receiving Party will exercise reasonable efforts to obtain
     assurance  that  confidential  treatment  will  be  accorded  such  of  the
     Confidential Information as is disclosed. Any disclosure made in accordance
     with the  provisions of this Section 11.7 shall not be regarded as a breach
     of the obligations of the Receiving Party pursuant to this Agreement.

11.8 Nothing in this  Article 11 shall be  construed as granting or conveying to
     the Receiving Party any right or license to use Confidential Information of
     the Disclosing Party except for the purposes contemplated in this Agreement
     or to practice any  inventions  described and claimed in any pending patent
     applications  or  issued  patents  which  are  owned or  controlled  by the
     Disclosing Party relating to such Confidential Information.

11.9 Each of the  parties  hereto  acknowledges  and agrees that the other party
     would be damaged  irreparably  in the event any of the  provisions  of this
     Article 11 are not performed in  accordance  with their  specific  terms or
     otherwise are breached.  Accordingly,  each of the parties  agrees that the
     other party shall be entitled to an  injunction or  injunctions  to prevent
     breaches of the  provisions of this Article 11 and to enforce  specifically
     the terms of this Article 11 in any action  instituted  in any court of the
     United States or any state thereof having  jurisdiction over the matter and
     the  parties,  in addition to any other remedy to which it may be entitled,
     at law or in equity.

12.  COMPLIANCE WITH LAWS; FAA INSPECTIONS.

12.1 TIMET and Boeing shall each be  responsible  for  complying  with all laws,
     including without  limitation,  any statute,  rule,  regulation,  judgment,
     decree,  order,  or  permit,  applicable  to  its  performance  under  this
     Agreement.  TIMET  agrees to notify  Boeing in the event (a) any of TIMET's
     obligations  under this Agreement  becomes  prohibited under any applicable
     environmental law, with such notice to be made at the earliest  practicable
     opportunity so as to enable the  identification  of alternative  methods of
     performance  or (b)  TIMET  becomes  subject  to  additional  environmental
     regulation  which could  reasonably  be expected to  materially  impair its
     ability  to  perform  under  this  Agreement  or  render  its   performance
     materially more costly.

12.2 Representatives  of the FAA and any Equivalent  Government Agency may, upon
     reasonable prior notice to TIMET and during normal business hours,  inspect
     and evaluate any of TIMET's or TIMET's subcontractor's plants,  facilities,
     systems, data, equipment,  inventory holding areas, procedures,  personnel,
     testing, and all work-in-process and completed Boeing Titanium Products for
     any  purpose  reasonably  related  to the  production  of  Boeing  Titanium
     Products.

                                      -11-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


13.  NOTICES; APPROVALS AND CONSENTS.

13.1 All  notices  and other  communications  under this  Agreement  shall be in
     writing and shall be addressed as provided in Section 13.3 below.

13.2 Such notices and communications  (properly addressed) shall be deemed given
     as follows:

     (a)  when personally delivered;

     (b)  three (3) business days after deposit in the mail, first class postage
          prepaid;

     (c)  one  (1)  day  after  deposit  with a  recognized  overnight  business
          delivery service; or

     (d)  when sent by verified  facsimile to the facsimile  number  provided in
          Section  13.3,  with original  forwarded by regular mail,  first class
          postage prepaid, or by recognized overnight business delivery service.

13.3 Notices and communications shall be addressed as follows:

                  If to Boeing:

                  Boeing Commercial Airplanes
                  Supplier Management & Procurement
                  P.O. Box 3707
                  M/S-_____________
                  Seattle, WA  98124-2207
                  Attn:    Director of Raw Materials
                           Facsimile No.: (206) 931-2660


                  If to TIMET:

                  Titanium Metals Corporation
                  3907 SW 328th Street
                  Federal Way, WA  98023
                  Attn:    Derek George
                  Facsimile No.: (253) 661-6424

                  With a copy to:

                  Titanium Metals Corporation
                  1999 Broadway, Suite 4300
                  Denver, Colorado 80202
                  Attn: General Counsel
                  Facsimile No.: (303) 291-2990

                                      -12-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     Either party may change its address or facsimile number by giving notice to
     the others in accordance with the provisions of this Article 13.

14.  ASSIGNMENT.

14.1 This  Agreement  shall  inure to the  benefit  of and be binding on each of
     TIMET and Boeing and their  respective  successors  and permitted  assigns.
     Neither  party  hereto may assign  its  rights  and  obligations  hereunder
     (except as otherwise  provided in the Terms & Conditions  with respect to a
     given Order) without the written consent of the other;  provided,  however,
     that  either  party may assign its rights and  obligations  hereunder  to a
     company  succeeding to all or  substantially  all of such party's  business
     without the consent of the other party. A change in control of either party
     shall not  affect the  respective  rights and  obligations  of the  parties
     hereunder.

15.  NON-WAIVER.

15.1 Boeing's or TIMET's  failure at any time to enforce any  provision  of this
     Agreement or any Order shall not  constitute a waiver of such  provision or
     prejudice  Boeing's  or TIMET's  right to  enforce  such  provision  at any
     subsequent time.

16.  INTERPRETATION.

16.1 Article and section  headings  used in this  Agreement  are for  convenient
     reference only and shall not affect the interpretation hereof

17.  PARTIAL INVALIDITY.

17.1 If any  provision of this  Agreement  is or becomes void or  unenforceable,
     whether  by  operation  of law or  otherwise,  the other  provisions  shall
     nevertheless remain valid and enforceable.

18.  APPLICABLE LAW.

18.1 The parties have  determined  that it is  reasonable  that this  Agreement,
     including all matters of construction,  validity, and performance, shall in
     all respects be governed by, and construed and enforced in accordance  only
     with the law of the State of Washington as applicable to contracts  entered
     into and to be performed  wholly within such state between citizens of such
     State, without reference to any rules governing conflicts of law.

19.  AMENDMENT.

19.1 No  provision  of this  Agreement  may be changed or  modified  except by a
     writing signed on behalf of Boeing and TIMET which makes express  reference
     to this Agreement.

20.  ENTIRE AGREEMENT; ORDER OF PRECEDENCE.

20.1 This  Agreement  (as  herein  amended  and  restated),  together  with  the
     schedules  and  exhibits  hereto  which are hereby  incorporated  into this
     Agreement by reference,  set forth the entire agreement  between Boeing and
     TIMET with respect to the subject  matter  hereof and supersede

                                      -13-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     any and all other prior  agreements and  understandings  between Boeing and
     TIMET with respect to such matters.

21.  AUTHORITY.

21.1 Each individual  executing this Agreement below hereby  certifies that this
     Agreement has been duly  approved and  authorized by the party on behalf of
     whom such  individual is executing and that such  individual  has been duly
     authorized by such party to execute this Agreement on behalf of such party.

                                      -14-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.

<PAGE>

22.  BOEING RECOGNIZED SUBCONTRACTORS.

22.1 Any current or potential supplier to Boeing (whether direct or indirect) of
     forged,  cast,  extruded,  or fabricated titanium parts or assemblies shall
     become a Boeing Recognized  Subcontractor  upon satisfaction of each of the
     following criteria:

     (a)  Boeing shall have notified TIMET in writing on or after April 19, 2001
          of its  desire  to have  such  supplier  become  a  Boeing  Recognized
          Subcontractor;

     (b)  such supplier shall have agreed to purchase Boeing  Titanium  Products
          on the terms and  conditions  attached  hereto as Exhibit A (Terms and
          Conditions of Purchase and Sale of Boeing  Titanium  Products) or such
          other terms and  conditions  as TIMET may agree in writing (in TIMET's
          sole discretion);

     (c)  such  supplier  shall have provided to TIMET a written  agreement,  in
          form and substance  reasonably  satisfactory to TIMET, to abide by the
          limitations on use and resale of Boeing Titanium Products set forth in
          Section 2.3 hereof; and

     (d)  TIMET shall have established credit  arrangements for such prospective
          Boeing  Recognized  Subcontractor on terms reasonably  satisfactory to
          TIMET or, in the absence thereof,  such prospective  Boeing Recognized
          Subcontractor  shall  have  agreed to pay  TIMET on a cash in  advance
          (i.e., upon placement of order) basis.

     Notwithstanding the foregoing provisions,  any supplier to Boeing that is a
     Boeing Recognized Subcontractor as of the date of this amended and restated
     Purchase  and Sale  Agreement  shall  be  regarded  as a Boeing  Recognized
     Subcontractor  pursuant  to this  Section 22 without  the need for  further
     action under this Section 22.1.

22.2 Boeing suppliers who have not become Boeing Recognized Subcontractors shall
     not be  guaranteed  the  pricing  or  availability  with  respect to Boeing
     Titanium Products afforded to Boeing,  Boeing's Agent and Boeing Recognized
     Subcontractors through this Agreement.  Volumes of titanium products either
     (a)  purchased  by  any  such  supplier  that  is not a  Boeing  Recognized
     Subcontractor  or (b) by a Boeing  Recognized  Subcontractor  that does not
     reasonably  identify to TIMET that it is  purchasing  under this  Agreement
     will not be  counted  as Boeing  Titanium  Products  purchased  under  this
     Agreement for any purpose.

22.3 If  a  Boeing   supplier   who  desires  to  become  a  Boeing   Recognized
     Subcontractor  does not have an established open account with TIMET,  TIMET
     will work in good faith with such supplier to establish credit arrangements
     for such supplier  reasonably  satisfactory to TIMET.  Boeing shall have no
     obligation  for any  payment due from any Boeing  Recognized  Subcontractor
     under any Order. 23. IDENTIFICATION BY BOEING AS HEDGING TRANSACTION.

23.1 Boeing hereby identifies the transactions contemplated by this Agreement as
     hedging transactions  pursuant to Treasury Regulations Section 1.1221-2(e).
     The  transactions  being hedged by Boeing  pursuant to this  Agreement  are
     Boeing's  purchases of titanium  over the term of this  Agreement,  and the
     risk  being  hedged  is the  risk of  price  movements  in the  market  for

                                      -15-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     titanium.  The types or classes  of  inventory  to which  this  transaction
     relates are  Boeing's  raw  materials  inventory  of titanium  and Boeing's
     titanium parts inventory. The expected purchase dates and the amounts to be
     purchased are unknown as of the date of this Agreement.



     IN WITNESS  WHEREOF,  this  Agreement  is executed on behalf of the parties
hereto as of the date first hereinabove set forth.

                             THE BOEING COMPANY, acting by and through
                             BOEING COMMERCIAL AIRPLANES




                             By: /s/ Tracy MacDonald-Schmidt
                                 -----------------------------------------------
                                             Tracy MacDonald-Schmidt
                                                Procurement Agent



                             TITANIUM METALS CORPORATION




                             By: /s/ J. Landis Martin
                                 -----------------------------------------------
                                                J. Landis Martin
                                  Chairman, President & Chief Executive Officer



                                      -16-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


Schedule 1: Pricing

[*]







                                      -17-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

                                                                       EXHIBIT A

6-5668-DAS/97-019 Rev. 1

                                  -------------



                    TERMS AND CONDITIONS OF PURCHASE AND SALE

                           OF BOEING TITANIUM PRODUCTS

                                  ------------



                           TITANIUM METALS CORPORATION

                                       and

                             BOEING, BOEING'S AGENT

                      OR A BOEING RECOGNIZED SUBCONTRACTOR

                                  ------------

         Applicable to all Boeing Titanium Products ordered pursuant to
             Boeing/TIMET Basic Agreement (6-5668-DAS/97-019 Rev. 1)

     These Terms and  Conditions of Purchase and Sale relate to the purchase and
sale of Boeing  Titanium  Products  by  Purchaser  from TIMET  pursuant  to that
certain  Purchase and Sale Agreement (for titanium  products),  originally dated
November 5, 1997, as amended and restated  effective April 19, 2001, between The
Boeing Company, acting by and through its division,  Boeing Commercial Airplanes
(f/k/a  Boeing  Commercial  Airplane  Group),  and Titanium  Metals  Corporation
(6-5668-DAS/97-019).  Purchaser,  if not Boeing  itself,  is Boeing's Agent or a
Boeing Recognized Subcontractor.


1.   DEFINITIONS

     Except as otherwise  expressly  provided in these Terms &  Conditions,  the
following  defined  terms  shall  have the  meanings  set forth  below when used
herein:

1.1  "Basic Agreement" means that certain Amended and Restated Purchase and Sale
     Agreement (for titanium  products),  originally  dated November 5, 1997, as
     amended and restated  effective April 19, 2001, between The Boeing Company,
     acting by and through its  division,  Boeing  Commercial  Airplanes  (f/k/a
     Boeing  Commercial   Airplane  Group),   and  Titanium  Metals  Corporation
     (6-5668-DAS/97-019  Rev. 1), as heretofore or hereafter amended,  modified,
     restated, or supplemented.

                                      -18-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

1.2  "Boeing" means The Boeing Company,  a Delaware  corporation,  acting by and
     through its division, Boeing Commercial Airplanes (f/k/a/ Boeing Commercial
     Airplane Group).

1.3  "Boeing  Recognized  Subcontractor"  means a  supplier  to Boeing  (whether
     direct or indirect) of forged,  cast, extruded or fabricated titanium parts
     that has  become a  Boeing  Recognized  Subcontractor  in  accordance  with
     Section 22 of the Basic Agreement.

1.4  "Boeing  Titanium  Product" means a titanium product of the type enumerated
     on Schedule 1 to the Basic  Agreement (as amended,  revised or supplemented
     from time to time) that is ordered or purchased  by a Purchaser  from TIMET
     pursuant  to  the  Basic  Agreement  for  use  in  manufacturing  parts  or
     assemblies for fixed wing, commercial aircraft manufactured by Boeing.

1.5  "Boeing's  Agent" means an entity that has been  designated  by Boeing from
     time to time to manage the purchasing of Boeing Titanium Products on behalf
     of it.

1.6  "Confidential Information" means confidential or proprietary information of
     the Disclosing  Party  furnished to the Receiving  Party in connection with
     the Orders, including without limitation, technical information in the form
     of designs, concepts, requirements,  specifications,  software, interfaces,
     components,  processes,  or the like, and which,  if in visual,  written or
     graphic  form,  is  clearly  and   conspicuously   identified   thereon  as
     "confidential" or "proprietary" or, if in oral form, is confirmed  promptly
     thereafter in writing as "confidential" or "proprietary." The provisions of
     this Section 1.5 and Article 15 shall not apply to, and the Receiving Party
     shall not be  obligated  to hold in  confidence  pursuant  to  Article  15,
     information which:

     (a)  was  in  the  lawful   possession  of  the  Receiving   Party  without
          confidentiality  restrictions  prior to its receipt  thereof  from the
          Disclosing Party;

     (b)  is or becomes  public  knowledge  without  the fault of the  Receiving
          Party;

     (c)  s or becomes available to the Receiving Party on an unrestricted basis
          from a source having a right to make such disclosure;

     (d)  is made  available  on an  unrestricted  basis to a third party by the
          Disclosing Party; or

     (e)  is  developed  by the  Receiving  Party  independent  of  Confidential
          Information received under Article 15.


                                      -19-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

1.7  "Disclosing   Party"  means  Purchaser  or  TIMET,  as  the  case  may  be,
     communicating  Confidential  Information  to the other in  connection  with
     these  Terms  &  Conditions.  1.8  "Excusable  Delay"  means  unforeseeable
     circumstances  beyond  the  reasonable  control  and  without  the fault or
     negligence of TIMET. Excusable Delays include, without limitation,  acts of
     God, war, riot, acts of government,  fires, floods,  epidemics,  quarantine
     restrictions,  freight embargoes, strikes, labor disputes, unusually severe
     weather,  but shall  expressly not include TIMET's  noncompliance  with any
     rule,  regulation or order  promulgated by any  governmental  agency for or
     with respect to environmental  protection.  The foregoing  notwithstanding,
     the following shall not be regarded as Excusable Delays:

     (a)  delays of less than two (2) days  duration  unless  such  delay  shall
          occur within thirty (30) days preceding the scheduled date of delivery
          of the Boeing Titanium Product in question; or

     (b)  the default of any of TIMET's subcontractors or suppliers in providing
          supplies  or  services  to TIMET if  TIMET  is able,  on  commercially
          reasonable  terms,  to obtain such  supplies  or  services  from other
          sources  in  sufficient  time to permit  TIMET to meet the  applicable
          delivery schedules.

1.9  "Order"  means a purchase  order for one or more Boeing  Titanium  Products
     placed by Purchaser  with TIMET,  to the limited extent such purchase order
     has been accepted in writing by TIMET or is deemed to have been accepted by
     TIMET pursuant to these Terms & Conditions.

1.10 "Purchaser"  means the person,  either Boeing,  Boeing's Agent, or a Boeing
     Recognized Subcontractor,  identified as the purchasing party pursuant to a
     given Order.

1.11 "Receiving  Party"  means the  party to whom  Confidential  Information  is
     communicated by the other party.

1.12 "Representatives"  of a given  party  means its  directors,  officers,  and
     employees.

1.13 "Sales  Taxes"  means  sales or use  taxes  imposed  on the sale of  Boeing
     Titanium Product.

1.14 "Specifications"  means the  chemical,  physical  and other  specifications
     (including inspecting and testing criteria) for Boeing Titanium Products as
     agreed to by Boeing and TIMET from time to time in writing.  In the absence
     of written agreement by Purchaser and TIMET on a different specification in
     a given Order for Boeing Titanium Product, the applicable Specification for
     such given Boeing  Titanium  Product shall be that  represented by the most
     recent  revision  agreed  to in  writing  by  Boeing  and TIMET and no such
     Specification  for a Boeing Titanium  Product may be altered or modified in
     any Order without the express written consent of TIMET.

1.15 "Stop Work Order"  means a written  directive to TIMET by Purchaser to stop
     work on a given Order in  accordance  with the  provisions  of Section 11.2
     below.

                                      -20-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

1.16 "Termination  Notice"  means a  written  notice  to TIMET by  Purchaser  to
     terminate part or all of a given Order in accordance with the provisions of
     Section 11.2 below.  Any such  Termination  Notice shall specify the extent
     and effective date of such termination.

1.17 "Terms & Conditions"  means these Terms and Conditions of Purchase and Sale
     of Boeing Titanium Products.

1.18 "TIMET" means Titanium Metals Corporation, a Delaware corporation.

2.   ISSUANCE OF ORDERS

2.1  Each Order placed by Purchaser pursuant to the Basic Agreement from time to
     time shall contain a description of the Boeing Titanium Product(s) ordered,
     a reference  to the  applicable  Specifications  for such  Boeing  Titanium
     Product,  the Boeing  purchase  order  number,  the  applicable  quantities
     desired, the price (determined in accordance with the Basic Agreement), the
     Boeing part  number,  the Boeing  airframe for which such part is intended,
     TIMET  purchased  weight per part and shipped  weight per part, the desired
     delivery  schedule,  and any other proposed terms  different from those set
     forth in these Terms & Conditions.

2.2  Each purchase order placed under the Basic  Agreement  shall  conspicuously
     reference "Boeing/TIMET LTA 6-5668-DAS/97-019 Rev. 1" (or similar reference
     clearly  identifying the Basic  Agreement).  Any purchase order placed with
     TIMET by a Purchaser  other than Boeing  which does not include such legend
     shall not be regarded as an Order under the Basic  Agreement  and shall not
     be entitled to the  benefits  of the  pricing or supply  provisions  of the
     Basic Agreement;  provided,  however, that any inadvertent omission of such
     reference  may  be  corrected  by  Purchaser   within  [  *  ]  of  TIMET's
     acknowledgment  of  the  Order  (or  such  longer  period  to  which  TIMET
     consents).

2.3  Each Order  shall be deemed to  incorporate  these  Terms &  Conditions  by
     reference  and to be  governed  by  these  Terms &  Conditions,  except  as
     otherwise  expressly  agreed in writing between  Purchaser and TIMET.  Each
     such  purchase  order shall  represent  the offer of  Purchaser to purchase
     strictly on the terms set forth in these Terms & Conditions.  To the extent
     such  purchase  order  contains  terms  inconsistent  with  these  Terms  &
     Conditions,  TIMET shall be deemed to have  objected  to such  inconsistent
     terms and they shall not become part of the Order, whether or not material,
     unless  TIMET  shall  expressly  agree to such  terms in  writing.  TIMET's
     commencement of performance shall be deemed to represent TIMET's acceptance
     of such  Order,  but  only to the  extent  consistent  with  these  Terms &
     Conditions.

2.4  Pricing for each Boeing Titanium  Product shall be as set forth on Schedule
     1 attached hereto and incorporated herein by this reference.

2.5  Purchaser and TIMET shall agree in writing upon the scheduled delivery date
     for any Boeing Titanium Product.

3.   DELIVERY; TITLE AND RISK OF LOSS


3.1  Delivery of Boeing Titanium Product shall be [ * ]

                                      -21-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

3.2  Deliveries  shall  be in  accordance  in all  material  respects  with  the
     quantities,  schedule and other  requirements  specified in the  applicable
     Order.  TIMET may not make early or partial  deliveries without the written
     authorization of Purchaser.

3.3  Title to and risk of any  loss  of,  or  damage  to,  the  Boeing  Titanium
     Products  shall pass from TIMET to Purchaser  upon  delivery in  accordance
     with the Order,  except for loss or damage  thereto  resulting from TIMET's
     negligence  or willful  misconduct.  Passage of title on delivery  does not
     constitute acceptance of such Boeing Titanium Product by Purchaser.

4.   DELAYS

4.1  TIMET  shall  notify  Purchaser  promptly of any  circumstances  that could
     reasonably be expected to cause a delay in delivery,  stating the estimated
     period of delay and the reasons therefor. If requested by Purchaser,  TIMET
     shall  use all  additional  commercially  reasonable  efforts  to  avoid or
     minimize delay to the maximum extent reasonably possible, including without
     limitation,  shipment via air or other  expedited  routing.  Any additional
     costs  resulting  from such efforts  will be borne by TIMET,  except to the
     extent such delay is  occasioned  by  Purchaser or Boeing.  Nothing  herein
     shall prejudice any rights or remedies provided to Purchaser under law.

4.2  TIMET shall  promptly  notify  Purchaser of any actual or threatened  labor
     dispute that could reasonably be expected to disrupt the timely performance
     of the Order.  TIMET shall  require  that any  subcontractor  to TIMET with
     respect to a Boeing Titanium Product provide similar notice to TIMET.

4.3  In the event of any delay in the delivery of any Boeing  Titanium  Product,
     TIMET  agrees that it will,  from time to time as  reasonably  requested by
     Purchaser,  and upon  reasonable  prior notice,  provide  Purchaser with an
     updated status report regarding such Boeing Titanium Product, including its
     expected  delivery date, all actions taken or planned by TIMET with respect
     to  expediting  such  delivery,  and such  other  relevant  information  as
     Purchaser may  reasonably  request.  Nothing herein shall be construed as a
     waiver of  Purchaser's  rights to  proceed  against  TIMET  because  of any
     delinquency.


5.   ON-SITE REVIEW

5.1  Authorized  representatives  of Purchaser  and/or  Boeing may enter TIMET's
     facility at any  reasonable  time upon  reasonable  prior notice to conduct
     preliminary  inspections  and tests of any  finished or  unfinished  Boeing
     Titanium  Product.  TIMET will include a like provision in its subcontracts
     issued in conjunction  with any Order giving Purchaser and Boeing the right
     to enter the premises of TIMET's subcontractors.  When reasonably requested
     by Purchaser or Boeing,  upon reasonable prior notice,  representatives  of
     TIMET will  accompany  the  representatives  of Purchaser  and/or Boeing to
     TIMET's subcontractor's facility.


6.   INVOICE AND PAYMENT

                                      -22-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

6.1  TIMET shall issue its invoice to Purchaser and unless  Purchaser has agreed
     to partial  delivery,  only upon  completion  of the Order in its entirety.
     Each invoice shall reference Purchaser's and Boeing's Order number.

6.2  Payment  terms  shall be [ * ],  unless  otherwise  agreed to in writing by
     TIMET and Purchaser.

6.3  Payments not received when due shall be subject, in TIMET's discretion,  to
     late charges of up to [ * ] on the amount outstanding from the date due.


7.   PACKING AND SHIPPING

7.1  TIMET shall (a) prepare for shipment and suitably pack all Boeing  Titanium
     Products to prevent  damage or  deterioration,  (b) when  Purchaser has not
     identified a carrier for shipment,  use commercially  reasonable efforts to
     secure  lowest   transportation  rates  available,   (c)  comply  with  the
     appropriate  carrier  tariff for the mode of  transportation  specified  by
     Purchaser, and (d) comply with any special instructions stated in the Order
     or  Specifications,  as agreed to by TIMET. If no special  instructions are
     noted, materials and methods used in packaging shall be suitable to provide
     reasonable protection against scratching, breaking and other damage.

7.2  Except as otherwise  agreed to by TIMET in the Order,  Purchaser  shall pay
     all charges for  preparation,  packing,  crating,  or cartage  requested by
     Purchaser that are beyond those  expressly  provided for in this Article 7.
     Unless  otherwise  directed by Purchaser,  all standard  routing  shipments
     forwarded on one day to Purchaser must be consolidated. Each container must
     be  consecutively  numbered  and marked as set forth below.  Container  and
     Order  numbers  must be  indicated on the  applicable  bill of lading.  Two
     copies of packing  sheets must be  attached to the No. 1 container  of each
     shipment and one copy in each individual container. Each packing sheet must
     include,  at a  minimum,  the  following  information:  (a)  TIMET's  name,
     address,  and phone number;  (b) Order and item number;  (c) ship date; (d)
     total quantity shipped and quantity in each container,  if applicable;  (e)
     legible packing slip number;  (f)  nomenclature;  (g) unit of measure;  (h)
     "ship to" if other than Purchaser; and (i) certification, as applicable.


8.   WARRANTY; INSPECTION; REJECTION & ACCEPTANCE


8.1  [ * ]

8.2  [ * ]

8.3  [ * ]

8.4  TIMET shall inspect or otherwise  verify that all Boeing Titanium  Products
     under each applicable Order, including those procured from, or furnished by
     Purchasers  to  TIMET,  comply  with the  requirements  of the Order in all
     material  respects.  TIMET shall include each packing sheet a certification
     that the Boeing Titanium  Products shipped comply with the  Specifications.
     No pre-certification shall be required prior to shipment.

                                      -23-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


8.5  TIMET  will  promptly  notify  Purchaser  when  discrepancies  or upsets in
     TIMET's  processes  or  product  are  discovered  or  suspected  for Boeing
     Titanium  Products  already  delivered by TIMET to Purchaser or Boeing that
     might  reasonably  be expected  call the integrity or safety of such Boeing
     Titanium Products into question.

8.6  Unless otherwise agreed to by Purchaser, Boeing Titanium Products delivered
     under an Order  shall be  subject to final  inspection  and  acceptance  by
     Purchaser at destination,  notwithstanding any payment or prior inspection.
     If Purchaser performs an inspection or test on the premises of TIMET or its
     subcontractor,  TIMET shall furnish, and shall require its subcontractor to
     furnish,  without additional charge,  reasonable  facilities and assistance
     for safe and convenient performance of these duties.

8.7  Purchaser  may reject any Boeing  Titanium  Product  which does not conform
     with the warranties set forth in Section 8.1. Purchaser or Boeing shall, by
     notice, rejection tag, or other written communication, notify TIMET of such
     rejection. [ * ]


9.   RECORDS; EXAMINATION OF RECORDS


9.1  Quality  assurance  records shall be maintained on file at TIMET's facility
     and available to authorized  representatives of Purchaser and Boeing. TIMET
     shall  retain  such  records  for a period of not less than seven (7) years
     from the date of final payment under the applicable Order.

9.2  All  reports,  drawings,  and  other  technical  information  submitted  to
     Purchaser  or Boeing for review or  approval  shall be in English and shall
     employ  the units of  measure  customarily  used by  Boeing  in the  United
     States.

9.3  TIMET shall  maintain  complete  and  accurate  records that show the sales
     volume of all Boeing Titanium Products delivered to Purchaser.

9.4  Purchaser  shall  maintain a record of all titanium  products  purchased by
     Purchaser   from  sources  other  than  TIMET  which  are  used  for  parts
     manufactured  by Purchaser  for Boeing  (whether  directly or  indirectly).
     Purchaser  will  report  such  quantities  to  Boeing  annually  or as more
     frequently requested by Boeing.


10.  AMENDMENTS TO ORDER


10.1 Subject to  Purchaser's  right to  terminate  an Order in  accordance  with
     Section 11.2,  once an Order has been placed and accepted by TIMET,  it may
     not be  modified  in  any  respect  (including  without  limitation,  as to
     delivery dates,  quantities,  size, or Specifications)  without the written
     approval  of both  Purchaser  and TIMET.  TIMET  will use all  commercially
     reasonable efforts to accommodate any proposed change in an Order,  subject
     to  agreement  between  TIMET and  Purchaser  as to any  resulting  pricing
     adjustment.

                                      -24-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

10.2 Any  proposed  modification  to an Order shall be  submitted  in writing by
     Purchaser  to TIMET.  TIMET  shall use its best  efforts  to respond to any
     requested change within [ * ]of receipt of such requested change, either by
     (a) accepting  such change  without price  adjustment,  (b) accepting  such
     change subject to a proposed price adjustment set forth in its response, or
     (c) rejecting  the change with a specific  indication as to why such change
     is commercially  impracticable and, if applicable, any proposed alternative
     that is believed by TIMET to achieve or approximate  the result intended by
     the proposed change.


11.  SUSPENSION OF WORK; TERMINATION OF ORDER


11.1 Subject to the provisions of Section 11.8 below, Purchaser may at any time,
     by a Stop Work Order  delivered to TIMET,  require TIMET to stop all or any
     part of the work called for by a given Order issued by Purchaser.  Promptly
     following  receipt of a Stop Work Order,  TIMET shall comply with its terms
     and take all  commercially  reasonable  steps to minimize the occurrence of
     costs  arising  from the work  covered  by the Stop Work  Order  during the
     period of work stoppage.  Unless Purchaser has canceled the Stop Work Order
     within [ * ] following  its  issuance,  TIMET will be entitled to treat the
     portion of the given  Order  subject to the Stop Work Order as having  been
     terminated in accordance  with the provisions of Section 11.2 below. In the
     event the Stop Work Order is canceled by Purchaser within such time period,
     TIMET  will  promptly  resume  work in  accordance  with  the  terms of the
     applicable Order. The applicable  scheduled  delivery date under such Order
     shall be deemed to have been  extended by the number of days  elapsing from
     the date of TIMET's  receipt  of the Stop Work Order  until the date of its
     receipt of notice of  cancellation  of the Stop Work  Order,  plus [ * ] to
     allow for the  material  to be worked  back  into the  existing  production
     schedule in an orderly fashion.

11.2 Subject to the  provisions of Section 11.8 below,  Purchaser may, from time
     to time,  in its  discretion,  terminate all or part of any Order issued by
     Purchaser pursuant to a Termination Notice delivered to TIMET. Upon receipt
     of  a  Termination  Notice,  TIMET  shall,  unless  otherwise  directed  by
     Purchaser:

     (a)  promptly stop work as specified in the Termination Notice;

     (b)  promptly  terminate its  subcontracts  and purchase orders relating to
          work  terminated,  to the extent  legally  possible  and  commercially
          reasonable;

     (c)  settle  any  termination  claims  made by  TIMET's  subcontractors  or
          suppliers,   provided  Purchaser  has  approved  the  amount  of  such
          termination claim prior to such settlement;

     (d)  preserve and protect in a commercially  reasonable manner all finished
          Boeing  Titanium  Products  covered  by such  Termination  Notice  and
          deliver the same to Purchaser upon its written direction;

     (e)  coordinate  with Purchaser and Boeing to reapply any unfinished  metal
          to any other Order placed by Purchaser, Boeing or Boeing's Agent under
          the Basic Agreement; and

                                      -25-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     (f)  take  such  other  commercially  reasonable  steps  as  Purchaser  may
          request.


11.3 If Purchaser  terminates an Order, in whole or in part, pursuant to Section
     11.2 above, and TIMET is unable to reapply, within [ * ]of the date of such
     termination,  any  Boeing  Titanium  Product  covered by such Order (in its
     then-current  state) to another  order  (other  than for its value as scrap
     material),  whether  on  behalf  of  Boeing,  Boeing's  Agent  or a  Boeing
     Recognized Subcontractor or otherwise, TIMET shall have the right to submit
     a written  termination  claim to Purchaser in accordance  with the terms of
     this Section 11.3. Such  termination  claim shall be submitted to Purchaser
     no later than [ * ] after TIMET's  receipt of the Termination  Notice.  Any
     claim by TIMET for  cancellation  charges not made within such [ * ] period
     shall be deemed waived by TIMET,  and TIMET shall thereafter be barred from
     submitting such claim and Purchaser shall have no obligation for payment to
     TIMET of any such claim.  Cancellation charges, if any, shall be determined
     and payable as follows as to each Boeing  Titanium  Product as to which the
     Order is terminated:


     [ * ]

          The  cancellation  charges reflect TIMET's  retention of the metal for
     its  reapplication  or scrap value;  therefore,  TIMET shall be entitled to
     retain the metal unless it shall have been reapplied in accordance with the
     provisions of Section 11.2(f). In addition, TIMET shall also be entitled to
     recover any amounts paid by TIMET in accordance with Section 11.2(c).


11.4 Any partial termination of an Order shall not alter or affect the terms and
     conditions  of the Order with respect to any Boeing  Titanium  Products not
     terminated or as to any other Order.

11.5 Termination  shall not  result  in any  change to unit  prices  for  Boeing
     Titanium Products not terminated.

11.6 Cancellation  charges  shall be payable by  Purchaser to TIMET within [ * ]
     following written claim therefor by TIMET.  Purchaser may have made partial
     cancellation  payments and payments against costs incurred by TIMET for the
     terminated  portion  of an Order,  in which  case  should the total of such
     payments  exceed the amount to which TIMET is  ultimately  determined to be
     entitled,  TIMET shall  repay the excess to  Purchaser  promptly  following
     demand.

11.7 TIMET shall  maintain all records and documents  relating to the terminated
     portion  of any  Order  for not less  than  three  (3)  years  after  final
     settlement of TIMET's termination claim.

11.8 Notwithstanding  the other  provisions of this Article 11, without  TIMET's
     written approval, [ * ]

                                      -26-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

12.  TIMET EVENTS OF DEFAULT; PURCHASER'S REMEDIES


12.1 The occurrence of any one or more of the following  events shall constitute
     a "TIMET Event of Default" hereunder:

     (a)  any  breach  by  TIMET  of  these  Terms  &  Conditions  or the  other
          provisions of the applicable Order in any material respect (other than
          a breach of the  warranty set forth in Section 8.1, for which the sole
          and  exclusive  remedy is  provided  in  Section  8.7),  which  breach
          continues  unremedied for more than [ * ] following  written notice of
          such breach by Purchaser to TIMET; or

     (b)  the suspension, dissolution or winding-up of TIMET's business, TIMET's
          admission in writing of its  insolvency  or inability to pay its debts
          as they become due, the  institution  of  reorganization,  bankruptcy,
          liquidation,  or other such  proceedings by TIMET,  the institution of
          reorganization,  bankruptcy,  liquidation,  or other such  proceedings
          against  TIMET  which  remain  undismissed  for  more  than [ * ], the
          appointment of a custodian,  trustee,  receiver, or similar person for
          TIMET's  properties  or business,  or an  assignment  by TIMET for the
          benefit of its creditors.


12.2 If any TIMET Event of Default shall occur,  Purchaser may pursue any or all
     of the following remedies:

     (a)  Purchaser may, upon written notice to TIMET, cancel the Order to which
          such  breach  relates,  in whole or in part,  in which case  Purchaser
          shall not  thereafter  be  required  to accept  tender by TIMET of any
          Boeing  Titanium  Products with respect to which Purchaser has elected
          to cancel such Order; or

     (b)  Purchaser may manufacture, produce or provide, or may engage any other
          person to manufacture, produce or provide, any Boeing Titanium Product
          in substitution  for the Boeing  Titanium  Products to be delivered or
          provided by TIMET  hereunder  with respect to which any Order (or part
          of an Order) has been  canceled and  Purchaser  may recover from TIMET
          the difference between the price for each such Boeing Titanium Product
          and  the  aggregate  expense  reasonably   incurred  by  Purchaser  to
          manufacture,   produce  or  provide,   or  engage  other   persons  to
          manufacture,  produce or provide,  each such Boeing Titanium  Product,
          but not to exceed an amount equal to [ * ] of the applicable price for
          such Boeing Titanium Product under such Order.


13.  PURCHASER EVENTS OF DEFAULT; TIMET'S REMEDIES


13.1 The occurrence of any one or more of the following  events shall constitute
     a "Purchaser Event of Default" hereunder:

     (a)  any  failure by  Purchaser  to make timely  payment of an  uncontested
          invoice for Boeing Titanium Product  previously  delivered by TIMET to
          Purchaser (or at Purchaser's


                                      -27-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

          direction to another),  which non-payment remains outstanding for more
          than [ * ] following written demand for payment by TIMET to Purchaser;

     (b)  any other breach by Purchaser of these Terms & Conditions or the other
          provisions  of the  applicable  Order in any material  respect,  which
          breach  continues  unremedied  for more than [ * ]  following  written
          notice of such breach by TIMET to Purchaser;

     (c)  Purchaser's  use of any Boeing Titanium  Product  purchased from TIMET
          hereunder for purposes  other than for use in  manufacturing  parts or
          assemblies for fixed wing, commercial aircraft manufactured by Boeing;
          or

     (d)  the  suspension,  dissolution or winding-up of  Purchaser's  business,
          Purchaser's admission in writing of its insolvency or inability to pay
          its debts as they  become  due,  the  institution  of  reorganization,
          bankruptcy,  liquidation,  or other such proceedings by Purchaser, the
          institution of reorganization,  bankruptcy, liquidation, or other such
          proceedings against Purchaser which remain undismissed for more than [
          * ], the  appointment of a custodian,  trustee,  receiver,  or similar
          person for  Purchaser's  properties  or business,  or an assignment by
          Purchaser for the benefit of its creditors.


13.2 If any Purchaser Event of Default shall occur,  TIMET may pursue any or all
     of the following remedies:

     (a)  TIMET may, upon written notice to Purchaser and Boeing, cancel any and
          all  outstanding  Orders by  Purchaser,  in whole or in part, in which
          case TIMET

          (i)  shall not  thereafter be required to continue  manufacture of any
               Boeing Titanium  Products with respect to which TIMET has elected
               to cancel such Order; and

          (ii) shall be  entitled to recover  from  Purchaser  the charges  that
               would have applied  under  Section 11.2 with respect to each such
               Boeing Titanium Product as to which an Order (or portion thereof)
               is canceled as though  Purchaser had  terminated  each such Order
               (or portion  thereof) in accordance  with Section 11.2 as of such
               date of cancellation; or

     (b)  TIMET may,  upon  written  notice to Purchaser  and Boeing,  refuse to
          further  recognize  Purchaser  as  such  for  purposes  of  the  Basic
          Agreement; or

     (c)  TIMET may, by written notice to such Purchaser and Boeing,
                  make any adjustment in the credit terms then applied to such
                  Purchaser (including without limitation, requiring Purchaser
                  to make full payment at time of Order placement).

                                      -28-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

14.  EXCUSABLE DELAY


14.1 If  delivery  of any  Boeing  Titanium  Product  is delayed by virtue of an
     Excusable  Delay,  the delivery of such Boeing  Titanium  Product  shall be
     extended for the period that such Excusable Delay shall continue; provided,
     however,  that if an  Excusable  Delay  shall  delay  delivery  of a Boeing
     Titanium Product for more than [ * ], Purchaser may, upon written notice to
     TIMET,  cancel all or part of the Order with respect to such delayed Boeing
     Titanium Product.

14.2 TIMET shall use all commercially reasonable efforts to mitigate the effects
     of any Excusable Delay, both during and after such Excusable Delay.


15.  CONFIDENTIALITY


15.1 The parties  will not  identify  information  as  Confidential  Information
     unless the Disclosing  Party believes that such  information is proprietary
     to, or  constitutes a trade secret of, the  Disclosing  Party.  The parties
     will attempt to limit the exchange of Confidential Information to only that
     Confidential  Information  necessary  for the  purposes  of  these  Terms &
     Conditions.

15.2 The parties  agree that,  for a period of [ * ] from the date of receipt of
     Confidential  Information,  without the prior written  consent of the other
     party  hereto and except as may be required  by law,  the  Receiving  Party
     shall hold in confidence and not disclose Confidential Information received
     by it, except to (a)  Representatives  of the  Receiving  Party who require
     such Confidential  Information for purposes of these Terms & Conditions and
     who agree to hold such Confidential Information in confidence in accordance
     with the terms of these Terms & Conditions  and (b)  subcontractors  of the
     Receiving  Party whose  involvement is required by the Receiving  Party for
     purposes  of  these  Terms  &  Conditions   and  who  agree  to  hold  such
     Confidential  Information  in confidence  in  accordance  with the terms of
     these Terms & Conditions.

15.3 Confidential  Information  shall not be used by the Receiving Party (or any
     Representative  to whom the Receiving  Party  discloses  such  Confidential
     Information)  except  for  the  purposes  contemplated  in  these  Terms  &
     Conditions.

15.4 The Receiving  Party will be deemed to have  satisfied its  obligations  of
     confidentiality and non-use hereunder if it uses reasonable care to protect
     against  unauthorized  disclosure  or  misuse of  Confidential  Information
     received by it hereunder,  which care shall not be less than the care taken
     by the  Receiving  Party to protect  its own  confidential  or  proprietary
     information  from  disclosure  or  use by  others.  Upon  discovery  of any
     accidental  disclosure  or  misuse,  the  Receiving  Party  shall  take all
     reasonable  steps to recover or limit further  misuse of such  Confidential
     Information.

15.5 The Receiving Party will copy Confidential  Information received by it only
     as  reasonably  necessary  for the purposes  contemplated  in these Terms &
     Conditions.

                                      -29-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


15.6 The Receiving Party agrees to return to the Disclosing  Party all copies of
     written  Confidential  Information  received  pursuant  to  these  Terms  &
     Conditions,  as  well as all  copies  made  thereof  or  written  materials
     prepared by the Receiving Party containing Confidential Information, within
     thirty (30) calendar days of the written  demand of the  Disclosing  Party;
     provided, however, that the Receiving Party may retain a single copy of all
     Confidential  Information received for purposes of establishing  compliance
     with the terms of these Terms & Conditions,  which copy shall be segregated
     from the normal business  records of the Receiving Party and held in strict
     confidence in accordance with the terms of these Terms & Conditions.

15.7 If the  Receiving  Party  or any of  its  Representatives  becomes  legally
     compelled (by deposition,  interrogatory,  request for documents, subpoena,
     civil  investigative  demand or similar  process)  to  disclose  any of the
     Confidential Information,  the Receiving Party will advise and consult with
     the Disclosing Party prior to any such  disclosure,  so that the Disclosing
     Party may seek a protective order or other appropriate  remedy and/or waive
     compliance with these Terms & Conditions. If such protective order or other
     remedy is not  obtained,  or  compliance  with these Terms & Conditions  is
     waived as above, the Receiving Party will disclose only that portion of the
     Confidential Information which the Receiving Party is advised by counsel is
     legally required and the Receiving Party will exercise  reasonable  efforts
     to obtain  assurance that  confidential  treatment will be accorded such of
     the  Confidential  Information  as is  disclosed.  Any  disclosure  made in
     accordance  with the  provisions of this Section 15.7 shall not be regarded
     as a breach of the  obligations  of the Receiving  Party  pursuant to these
     Terms & Conditions.

15.8 Nothing in this  Article 15 shall be  construed as granting or conveying to
     the Receiving Party any right or license to use Confidential Information of
     the Disclosing Party except for the purposes  contemplated in these Terms &
     Conditions  or to  practice  any  inventions  described  and claimed in any
     pending patent applications or issued patents which are owned or controlled
     by the Disclosing Party relating to such Confidential Information.

15.9 Each of the  parties  hereto  acknowledges  and agrees that the other party
     would be damaged  irreparably  in the event any of the  provisions  of this
     Article 15 are not performed in  accordance  with their  specific  terms or
     otherwise are breached.  Accordingly,  each of the parties  agrees that the
     other party shall be entitled to an  injunction or  injunctions  to prevent
     breaches of the  provisions of this Article 15 and to enforce  specifically
     the terms of this Article 15 in any action  instituted  in any court of the
     United States or any state thereof having  jurisdiction over the matter and
     the  parties,  in addition to any other remedy to which it may be entitled,
     at law or in equity.


16.  COMPLIANCE WITH LAWS


16.1 TIMET and Purchaser  shall each be responsible for complying with all laws,
     including without  limitation,  any statute,  rule,  regulation,  judgment,
     decree, order, or permit, applicable to its performance under these Terms &
     Conditions.  TIMET agrees to notify  Purchaser  and Boeing in the event (a)
     any  of  TIMET's   obligations  under  these  Terms  &  Conditions  becomes
     prohibited under any applicable  environmental  law, with such notice to be
     made  at  the  earliest  practicable   opportunity  so  as  to  enable  the
     identification  of alternative  methods of performance

                                      -30-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


     or (b) TIMET becomes subject to additional  environmental  regulation which
     could  reasonably be expected to  materially  impair its ability to perform
     under these Terms & Conditions.

16.2 TIMET shall,  at least  annually or as Purchaser may  otherwise  reasonably
     request,  via invoice or other form  reasonably  satisfactory to Purchaser,
     certify  that the  Boeing  Titanium  Products  covered  by each  Order were
     produced  in  compliance  with  Sections  6, 7,  and 12 of the  Fair  Labor
     Standards Act (29 U.S.C. ss.ss.  201-291),  as amended, and the regulations
     and orders of the U.S. Department of Labor issued thereunder.  In addition,
     to the extent flow-down of the following Federal Acquisition Regulations is
     required  by any  Purchaser  contract  to  which  an  Order  relates,  such
     regulations are incorporated herein by reference to each such Order, except
     that in such context the term "Contractor" shall mean TIMET:

     (a)  FAR 52.222-26 Equal Opportunity;

     (b)  FAR 52.222-35  Affirmative Action for Special Disabled and Vietnam Era
          Veterans; and

     (c)  FAR 52.222-36 Affirmative Action for Handicapped Workers.


17.  INFRINGEMENT


17.1 Except as provided in Section 17.2 below,  TIMET shall  indemnify,  defend,
     and  save  Purchaser  harmless  from all  claims,  suits,  actions,  awards
     (including without limitation,  awards based upon intentional  infringement
     of  patents  known to TIMET  at the  time of such  infringement,  exceeding
     actual   damages,   and/or   including   attorneys'   fees  and/or  costs),
     liabilities,  damages,  attorneys' fees, and costs related to the actual or
     alleged infringement of any United States or foreign intellectual  property
     right  (including  without  limitation,  any right in a patent,  copyright,
     industrial design or semiconductor mask work, or based on  misappropriation
     or  wrongful  use of  information  or  documents)  and  arising  out of the
     manufacture,  sale,  or  use  of  Boeing  Titanium  Products  by  TIMET  or
     Purchaser.  Purchaser shall promptly notify TIMET of any such claim,  suit,
     or action,  and TIMET shall,  at its own expense,  fully defend such claim,
     suit, or action on behalf of Purchaser.

17.2 Section 17.1 shall not apply in the case of, and Purchaser shall indemnify,
     defend,  and save TIMET  harmless  from,  any claim,  suit,  action,  award
     (including without limitation, award based upon intentional infringement of
     patents  known to  Purchaser  at the time of such  infringement,  exceeding
     actual damages, and/or including attorneys' fees and/or costs),  liability,
     damage,  attorneys'  fees,  and costs  related  to the  actual  or  alleged
     infringement  of any United States or foreign  intellectual  property right
     (including without limitation, any right in a patent, copyright, industrial
     design or semiconductor mask work, or based on misappropriation or wrongful
     use of information or documents) when such infringement arises from:

     (a)  TIMET's compliance with formal specifications issued by Purchaser when
          infringement  could not  reasonably be avoided in complying  with such
          specifications; or

                                      -31-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     (b)  the  use  or  sale  of  Boeing  Titanium   Products  by  Purchaser  in
          combination  with other  items when such  infringement  would not have
          occurred from the use or sale of those Boeing Titanium Products solely
          for the purpose for which they were designed or sold by TIMET.

          For purposes of this Section  17.2,  the term  "TIMET"  shall  include
     Titanium Metals  Corporation and all of its subsidiaries and the respective
     officers, agents, and employees of each.


18.  NOTICES; APPROVALS AND CONSENTS


18.1 All notices and other  communications  under these Terms & Conditions shall
     be in writing and shall be addressed as provided in Section 18.3 below.

18.2 Such notices and communications  (properly addressed) shall be deemed given
     as follows:

     (a)  when personally delivered;

     (b)  three (3) business days after deposit in the mail, first class postage
          prepaid;

     (c)  one  (1)  day  after  deposit  with a  recognized  overnight  business
          delivery service; or

     (d)  when sent by verified  facsimile to the facsimile  number  provided in
          Section  18.3,  with original  forwarded by regular mail,  first class
          postage prepaid, or by recognized overnight business delivery service.

18.3 Notices and communications shall be addressed as follows:

                  If to Boeing:

                               Boeing Commercial Airplanes
                               Supplier Management & Procurement
                               P.O. Box 3707 Mail Stop _______
                               Seattle, WA  98124-2207
                               Facsimile No.: (206) 931-2660

                  If to TIMET:

                               Titanium Metals Corporation
                               3907 SW 328th Street
                               Federal Way, WA 98023
                               Attn:        Derek George
                               Facsimile No.: (253) 661-6424


                                      -32-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

                      With a copy to:

                                        Titanium Metals Corporation
                                        1999 Broadway, Suite 4300
                                        Denver, Colorado   80202
                                        Attn: General Counsel
                                        Facsimile No.: (303) 291-2990

                  If to Purchaser:     as set forth in the applicable Order (or
`                                      as otherwise on record with TIMET)

                  Any party may change its address or facsimile number by giving
         notice to the others in accordance with the provisions of this Article
         18.


18.4 With respect to all matters subject to the approval or consent of Purchaser
     or TIMET, such approval or consent shall be deemed given only when given in
     writing in the manner provided in this Article 18 for notices.


19.  ASSIGNMENT


19.1 Each Order  shall  inure to the  benefit of and be binding on each of TIMET
     and  Purchaser  and their  respective  successors  and  assigns;  provided,
     however, that no assignment of any rights or delegation of any duties under
     any such Order shall be binding upon Purchaser unless  Purchaser's  written
     consent has first been  obtained,  except that TIMET may assign  claims for
     monies due or to become due under any Order.

20.  NON-WAIVER


20.1 No failure on the part of  Purchaser  or TIMET in  exercising  any right or
     remedy  hereunder,  or as  provided  in law  or in  equity,  shall  impair,
     prejudice,  or constitute a waiver of any such right or remedy, or shall be
     construed  as a  waiver  of any  Event  of  Default  or as an  acquiescence
     therein.  No single or partial  exercise of any such right of remedy  shall
     preclude any other or further exercise thereof or the exercise of any other
     right or remedy.  No acceptance of partial  payment or  performance  of any
     obligation hereunder shall constitute a waiver of any Event of Default or a
     waiver or release of payment or performance in full of any such obligation.
     Notwithstanding  the  foregoing,  the rights and remedies of Purchaser  and
     TIMET set forth in Sections 8.7, 12.2 and 13.2, as applicable, shall be the
     sole and exclusive remedies available to such parties for any breach of the
     terms of any Order.

                                      -33-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

21.  INTERPRETATION


21.1 Article  and section  headings  used in these  Terms &  Conditions  are for
     convenient reference only and shall not affect the interpretation hereof.


22.  PARTIAL INVALIDITY


22.1 If any  provision of any Order or of these Terms & Conditions is or becomes
     void or unenforceable,  whether by operation of law or otherwise, the other
     provisions shall nevertheless remain valid and enforceable.


23.  APPLICABLE LAW


23.1 Given the significant variety of Boeing Recognized  Subcontractors that may
     be  participating  in the  Basic  Agreement  and  the  impracticability  of
     selecting a governing  jurisdiction  that  necessarily  bears a substantial
     relationship  to the location of operations of either TIMET or Purchaser in
     each instance,  the parties have determined that it is reasonable that each
     Order,  including all matters of construction,  validity,  and performance,
     shall in all  respects  be  governed  by, and  construed  and  enforced  in
     accordance  only with the law of the State of  Washington  as applicable to
     contracts entered into and to be performed wholly within such state between
     citizens of such State,  without reference to any rules governing conflicts
     of law.


24.  AMENDMENT


24.1 No Order and no  provision  of these Terms &  Conditions  may be changed or
     modified  except by a writing signed on behalf of TIMET and Purchaser which
     makes  express  reference  to such Order or these  Terms &  Conditions,  as
     applicable.


25.  TAXES


25.1 All taxes, including without limitation, federal, state, local, and foreign
     income taxes, value added taxes,  gross receipt taxes,  property taxes, and
     custom  duties or taxes are deemed to be included in the Order price unless
     otherwise expressly provided therein; provided, however, that the foregoing
     shall not apply to  applicable  Sales Taxes on sales to Purchaser for which
     Purchaser has not supplied a valid exemption certificate.


                                      -34-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>


25.2 In the event that any taxing  authority  has claimed or does claim  payment
     for Sales Taxes,  TIMET shall promptly  notify  Purchaser,  and TIMET shall
     take such action as Purchaser may reasonably request to pay or protest such
     taxes or to defend against such claim.  Purchaser  shall indemnify and hold
     TIMET harmless from any and all reasonable liabilities,  damages, costs and
     expenses (including without limitation, reasonable attorneys fees and costs
     of  litigation)  incurred in connection  with such defense,  as well as the
     amount of any taxes ultimately  determined to be due and payable.  If TIMET
     is successful in defending such claim,  the amount of such taxes  recovered
     by TIMET  which  had  previously  been  paid by  TIMET  and  reimbursed  by
     Purchaser or paid directly by Purchaser,  less TIMET's reasonable  expenses
     incurred as provided in the foregoing sentence,  shall be promptly returned
     to Purchaser.

25.3 If any taxes paid by  Purchaser  are  subject  to rebate or  reimbursement,
     TIMET shall take all commercially reasonable actions to secure such rebates
     or  reimbursement  and  shall  promptly  refund  to  Purchaser  any  amount
     recovered.


26.  ENTIRE AGREEMENT; ORDER OF PRECEDENCE


26.1 The Basic  Agreement,  the Order and these Terms & Conditions set forth the
     entire  agreement  between  Purchaser and TIMET with respect to the subject
     manner of such Order and supersede any and all other prior  agreements  and
     understandings between Purchaser and TIMET with respect to such Order.

26.2 In the event of any conflict or  inconsistency  between any of the terms of
     the following documents, the following order of precedence shall control:

     (a)  the Basic Agreement;

     (b)  the Order (excluding these Terms & Conditions) as agreed to in writing
          between Purchaser and TIMET;

     (c)  these Terms & Conditions; and

     (d)  any other  exhibits or documents  that Purchaser and TIMET have agreed
          in writing to be part of the  agreement  between  them with respect to
          the Order.


27.  GOVERNING QUALITY ASSURANCE REQUIREMENTS

27.1 In addition to those general quality  assurance  requirements  set forth in
     the Basic  Agreement  or above,  the work  performed  under  these  Terms &
     Conditions shall be in accordance with the requirements set forth herein.

27.2 All work  performed  under these Terms & Conditions  shall be in accordance
     with either:

     (a)  Document  D1-9000 Rev. A, "Advanced  Quality  System," Section 1 Basic
          Quality System, which is incorporated herein and made a part hereof by
          this reference, or

                                      -35-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

     (b)  Alternatively,  as and  when  TIMET  becomes  approved  by  Boeing  to
          Document D6-82479,  "Boeing Quality Management System Requirements for
          Suppliers - Appendix A - Quality Management System," then at such time
          said document shall apply and will be incorporated herein, made a part
          hereof by this  reference,  and  supercede  Document  D1-9000  Rev. A.
          Boeing will notify TIMET in writing of any proposed future  amendments
          thereto,  and the parties  will  consult with respect to the timing of
          TIMET's implementation of such amendment.

27.3 Supplemental Quality Requirements

     In  addition,  TIMET  shall also  comply  with the  following  Supplemental
Quality Requirements:

     (a)  At least annually,  TIMET shall conduct internal audits at each of its
          manufacturing  and Service Center sites to ensure  compliance to their
          quality system and the controlling quality assurance document;

     (b)  TIMET shall  promptly  notify Boeing of any changes in the  management
          representative  with  assigned  responsibility  and  authority for the
          quality system;

     (c)  TIMET shall immediately  notify Boeing in writing of any change to the
          manufacturing facility location of the Boeing Titanium Product;

     (d)  TIMET  shall  maintain  an  English  language  translation  of (1) its
          quality  manual,  (2) the operating  instructions  that  implement the
          quality manual requirements (except with respect to TIMET Savoie), and
          (3) an  index of all  other  TIMET  procedures  that  contain  quality
          requirements.  Boeing  may  require  additional  documentation  to  be
          translated,  including  but not  limited to:  shop  orders,  technical
          specifications,  certificates,  reports, nonconformance documents and,
          with  respect  to  TIMET  Savoie,  the  operating   instructions  that
          implement the quality manual requirements;

     (e)  TIMET shall  prepare and  maintain a list of  subcontractors  for each
          Boeing Titanium Product manufactured for use on Boeing aircraft.  When
          requested by Boeing,  TIMET shall provide such list to Boeing.  Boeing
          may request such list for any reason it deems necessary  including but
          not limited to the following:

          (1)  TIMET  makes  a   determination   of  Boeing   Titanium   Product
               conformance by means other than source inspection;

          (2)  TIMET or their subcontractor(s)  delegate inspection authority to
               their subcontractors;

          (3)  A subcontractor delivers Products directly to Boeing;

          (4)  A  subcontractor  performs  special  processes as  identified  in
               Boeing D1-4426, Boeing Approved Process Sources; or

          (5)  A  subcontractor  performs  other  processes  that require Boeing
               approval identified in design data (e.g., DMS, DPS, BMS, BAC).


                                      -36-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>

                  Subcontractor data shall contain the subcontractor name,
                  address, and telephone number, QA manager name and special
                  processes.
27.4     Acceptance/Rejection of TIMET's Root Cause/Corrective Action

         Boeing reserves the right to reject any root cause and/or corrective
         action determination provided by TIMET, and may request subsequent
         investigation and/or corrective action to either Boeing or
         TIMET-initiated corrective action requests. If TIMET is late in
         responding to corrective action requests by Boeing, or if Boeing
         requires subsequent corrective action, Boeing reserves the right to
         withhold acceptance of shipments of the affected Boeing Titanium
         Product either at source or destination until TIMET corrective action
         is submitted to Boeing's satisfaction.

27.5     Additional Puget Sound, Wichita, and Tulsa Quality Requirements

          (a)  TIMET's Inspection Options

               (1)  TIMET shall  perform  either 100%  inspection  or acceptance
                    sampling for receiving inspection.  TIMET shall perform 100%
                    inspection,   acceptance  sampling  or  statistical  process
                    control for  in-process  inspection or final  inspection for
                    each characteristic of a Boeing Titanium Product.

               (2)  If TIMET performs  acceptance  sampling,  TIMET shall have a
                    Boeing-approved  acceptance  sampling  plan.  The plan shall
                    meet the requirements of Boeing document  D1-8007,  Approval
                    Guide for Supplier Statistical Sampling Plans.

               (3)  When  statistical  process  control is used as an option for
                    either  in-process or final  inspection,  TIMET must satisfy
                    the requirements of D6-82479, Addendum 1.

               (4)  In  all  cases,   inspection   requirements   identified  by
                    engineering  drawing or  specification  take precedence over
                    the  inspection  options  described  here  and in  D6-82479,
                    Addendum  1.  Boeing  reserves  the  right to  require  100%
                    inspection for selected characteristics.

          (b)  Change in Quality System Procedures

               (1)  TIMET  shall  immediately  notify  Boeing in  writing of any
                    change to the  quality  control  system  that may affect the
                    inspection,   conformity  or  airworthiness  of  the  Boeing
                    Titanium Product.  After the issue of initial Boeing quality
                    system  approval,  each change to the quality control system
                    that  may  reasonably  be  expected  to  affect  any  of the
                    foregoing  aspects  in any  material  respect  is subject to
                    review by Boeing.

               (2)  TIMET shall include,  as part of the aforementioned  written
                    notification of change to the quality control system, a list
                    of  changed  procedures  identified  by  revision  level,  a
                    description  of the  intent  of  the  changes  and a  signed
                    statement  that  compliance  to the  Boeing  quality  system
                    approval has not been diminished.

                                      -37-

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.
<PAGE>
<TABLE>
<CAPTION>




EXHIBIT B
<S>                                    <C>        <C>         <C>         <C>         <C>
     Category            Notes         Q1         Q2          Q3          Q4          Annual
---------------------- --------------- ---------- ----------- ----------- ----------- ----------
Volume Maximum         (a)(b)          3.0        3.0         3.0         3.0         7.5

---------------------- --------------- ---------- ----------- ----------- ----------- ----------
[ * ]                  (c)             [ * ]      [ * ]       [ * ]       [ * ]       [ * ]

---------------------- --------------- ---------- ----------- ----------- ----------- ----------
Lead Time              (d)             [ * ]      [ * ]       [ * ]       [ * ]       [ * ]
---------------------- --------------- ---------- ----------- ----------- ----------- ----------
</TABLE>

                                      NOTES

     (a)  Amounts (other than percentages) are in millions of pounds.

     (b)  TIMET is not required to accept Orders from Boeing,  Boeing's Agent or
          any  Boeing  Recognized  Subcontractor  for Boeing  Titanium  Products
          aggregating more than 3.0 million pounds in any given Calendar Quarter
          or more than 7.5 million  pounds in any given  calendar  year (but may
          elect to do so, if -- requested,  in its sole discretion).  TIMET will
          provide written notice to Boeing in the event the aggregate  purchases
          by Boeing,  Boeing's  Agent and all Boeing  Recognized  Subcontractors
          credited  for any  given  Calendar  Quarter  reach [ * ]. In the event
          TIMET  shall  have  failed to give  notice  by the time the  aggregate
          purchases  by  Boeing,   Boeing's  Agent  and  all  Boeing  Recognized
          Subcontractors  exceeds [ * ], then the maximum  volume limit for such
          Calendar  Quarter  shall be  increased by the  difference  between the
          volume at the time notice is given and [ * ].

     (c)  [ * ]

     (d)  All Orders are  subject to the  limitations  shown in the latest  Lead
          Time  Schedule in  accordance  with  Section  4.3.  Lead times will be
          comparable to those  supplied to other  customers for like product and
          quantity.

* Certain information, indicated by [ * ] has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to such omitted portions.



</TEXT>
</DOCUMENT>
