Transitional Services Agreement

EXHIBIT 10.9


TRANSITIONAL SERVICES AGREEMENT
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This Transitional Services Agreement (the "Agreement") is made and
--------- entered into as of September 30, 1998 (the "Effective Date"), by and among Owens
-------------- Corning, a Delaware corporation ("OC"), and Advanced Glassfiber Yarns LLC, a
-- Delaware limited liability company (the "Company").
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RECITALS
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WHEREAS, OC and Company have entered into that certain Amended and Restated Asset Contribution Agreement dated as of July 31, 1998 (the "Contribution Agreement"), whereby OC contributed to the Company its business of ---------------------- manufacturing and selling glass fiber yarns and specialty materials at its facilities located in Aiken, South Carolina, Huntingdon, Pennsylvania and South Hill, Virginia (the "Business") in exchange for all of the membership interest
-------- in the Company and other consideration;


WHEREAS, OC, the Company and Glass Holdings Corp. have entered into that certain LLC Interest Sale and Purchase Agreement dated as of July 31, 1998 (the "SPA"), whereby OC agreed to sell a 51% interest in the Company to AGY
--- Holdings, Inc.; and


WHEREAS, each party hereto desires to continue to provide to the other party selected services, and each party is willing to do so on the terms and conditions set forth herein.


NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereby agree as follows:


1. Provision of Transitional Services.
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(a) Subject to the terms and conditions of this Agreement and
during the Transition Period (as defined herein), OC will provide the
Company (for the Business):


(i) the corporate services described in Appendix A,
which is attached to and made part of this Agreement (hereinafter
referred to individually as a "Service" and collectively as the
-------
"Corporate Services");
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(ii) the information systems services described in
Appendix B, which is attached to and made part of this Agreement


(hereinafter referred to individually as a "Service," and
collectively as the "IS Services").
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(iii) and such other services not specifically
enumerated on Appendix A or B provided by OC to the Business as
of the date hereof (hereinafter referred to individually as a
"Service" and, together with the Corporate Services, the IS
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Services and the services referenced in 1(b), the "Services").
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(b) Subject to the terms and conditions of this Agreement and
during the Term (as defined herein), the Company will provide OC with
the services described in Appendix C.


2. Method of Provision of Services. Each party agrees to provide to the other
------------------------------- party the Services at the current level, scope and manner at which such Services have been provided by OC or its Composites Systems Business to the Business or to the Aiken mat line facility as of the date of this Agreement. Neither party shall be under an obligation to expand or modify the level, scope or manner of the Services provided. All Services shall be provided in a professional workmanlike manner and,in the case of OC, shall be of a quality at least equal to that provided by OC to its most favored Affiliate.


3. Discontinuation of Services. Either party may elect to discontinue
--------------------------- receiving any Service under this Agreement by giving the other party at least twenty (20) days' advance written notice of its election to discontinue such Service or Services.


4. Disclaimer of Warranty. THE SERVICES HEREUNDER ARE PROVIDED ON AN "AS IS"
---------------------- BASIS. EACH PARTY HEREBY DISCLAIMS ANY EXPRESS OR IMPLIED WARRANTIES OF ANY KIND, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.


5. Limitation of Liability.
-----------------------


(a) No party will be liable to the other party for any
incidental, consequential, special or punitive damages of any kind or
nature, including without limitation loss of data, services, profits,
revenue, business and service interruption in connection with, or
related to, the performance of this Agreement, or arising out of the
Services rendered hereunder, whether such liability is asserted on the
basis of contract (including, without limitation, the breach of this
Agreement or any termination of this Agreement), tort (including
negligence or


-2-


strict liability), or otherwise, even if any other party has been warned of
the possibility of any such loss or damage in advance.


(b) Except as provided in Paragraph 5(a) and except in the event of
reckless or willful misconduct (whether or not the party is negligent) or
gross negligence, neither party shall be liable to the other party for any
claims, liabilities, damages, losses, costs, expenses (including, but not
limited to, settlements, judgments, court costs and reasonable legal fees),
fines and penalties, arising out of any actual or alleged injury, loss or
damage of any nature whatsoever suffered by such other party in providing
or failing to provide the Services to the Company. Notwithstanding anything
to the contrary contained herein, if either party commits an error with
respect to or incorrectly performs or fails to perform any Service, at the
other party's request, the erring party shall use reasonable efforts to
correct such error, reperform or perform such Service; provided, that
--------
neither party shall have any obligation to recreate any lost or destroyed
data to the extent the same cannot be cured by the reperformance of the
Service in question.


6. Price and Payment for Services. Each party shall invoice the other on a
------------------------------ monthly basis for services rendered in the preceding calendar month. Each invoice shall be sufficiently detailed to substantiate all amounts and Services charged. The prices that will be paid for the Services under this Agreement during the Term, will be as follows:


(a) For the Services, the Company shall pay to OC a fee equal to OC's
costs to provide the Services as described in Appendix A.


(b) For the IS Services, the Company shall pay to OC a fee equal to
OC's costs to provide the IS Services as described in Appendix B.


(c) For the Services rendered by the Company to OC, OC shall pay a
fee equal to the Company's costs to provide such Services as described in
Appendix C.


(d) For any other Service needed by either party from the other, a
fee equal to that party's costs to provide such Service shall be charged.


(e) For any Service rendered by a third party on behalf of a party,
the party receiving the Services shall pay to the party providing the
Services the fee equal to the fee charged by such third party, without
mark-up. ...