<SEQUENCE>3

<FILENAME>exhibit10-2.txt

<DESCRIPTION>EXHIBIT 10.2

<TEXT>







                             SUPPLEMENTAL INDENTURE



                  This Supplemental Indenture is dated as of July 2, 2001,

among THE DERBY CYCLE CORPORATION, a Delaware corporation ("DCC"), LYON

INVESTMENTS B.V., a company organized under the laws of The Netherlands and a

wholly owned subsidiary of DCC ("Lyon" and, together with DCC, the "Issuers"),

as issuers, and THE BANK OF NEW YORK as successor to IBJ SCHRODER BANK & TRUST

COMPANY, a New York banking corporation, as trustee (the "Trustee"). Each

defined term used herein shall have the meaning assigned to it in the Indenture

(hereinafter defined), unless the context hereof otherwise requires or provides.



                                    RECITALS



                  1.       The Issuers and the Trustee have executed an

Indenture dated as of May 14, 1998 (as amended or supplemented, the "Indenture")

providing for the issuance of $100,000,000 of the Issuers' 10% Senior Notes due

2008 (the "Securities").



                  2.       Section 9.02 of the Indenture generally permits the

Indenture to be amended or supplemented, or compliance with any provision of the

Indenture or the Securities to be waived, with the written consent of the

Holders of not less than a majority in principal amount of the Securities then

outstanding.



                  3.       The Issuers have received written consents of Holders

of not less than a majority in the aggregate principal amount of the Securities

outstanding as of June 13, 2001 (the record date fixed by the Issuers pursuant

to the terms of the Indenture) to the amendments and the waiver of compliance

with certain provisions of the Indenture contemplated by Section 1.01 hereof.



                  4.       The Issuers have always treated their business and

enterprises as being separate and independent business entities and have always

held themselves out to the Holders and the Trustee as being separate and

independent business entities.



                  The Issuers and the Trustee agree as follows for the benefit

of each other and for the equal and ratable benefit of the Holders of the

Securities:



                                   ARTICLE I



              AMENDMENTS AND WAIVERS WITH RESPECT TO THE INDENTURE



                  Section 1.01      AMENDMENTS. The Indenture is hereby amended

as follows:



                  (a)      Section 1.01 of the Indenture is amended as follows:



                           (i)      by inserting the following new definitions

                  in the appropriate alphabetic order:



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                  "Default Rate" means the interest rate on overdue installments

                  of interest set forth in the Securities.



                  "Derby Nederland" means Derby Nederland B.V., together with

                  its successors and assigns.



                  "DM Indenture" means the Indenture (as supplemented from time

                  to time), dated as of May 14, 1998, providing for the issuance

                  of an aggregate principal amount of up to DM110,000,000 of 9

                  3/8% Senior Notes due 2008 among DCC and Lyon, as issuers, and

                  The Bank of New York as successor to IBJ Schroder Bank & Trust

                  Company, in its capacity as trustee thereunder.



                  "DM Securities" means the securities issued under the DM

                  Indenture.



                  "DM Trustee" means the party named as trustee in the DM

                  Indenture until a successor trustee replaces it and,

                  thereafter, means the successor trustee.



                  "Euro Equivalent" means on any particular date, (i) with

                  respect to any amount denominated in Euros, such amount in

                  Euros, (ii) with respect to any amount denominated in

                  Deutschemarks, such amount divided by 1.95583 and (iii) with

                  respect to any amount denominated in U.S. Dollars, the average

                  of the amount of Euros which could be purchased by each of the

                  Trustee and the DM Trustee (in accordance with their normal

                  banking practices) in the London foreign currency deposit

                  market with such amount of such currency at the spot rate of

                  exchange prevailing at or about 11:00 a.m. (London time) on

                  such date.



                  "Gazelle Sale" means the sale of Koninklijke Gazelle B.V. by

                  Derby Nederland to Gazelle Holding B.V., pursuant to the terms

                  and conditions of the Sale and Purchase Agreement, dated on or

                  about June 14, 2001, among DCC, Derby Nederland and Gazelle

                  Holding B.V. (a copy of which was delivered to the Trustee on

                  June 14, 2001).



                  "General Asset Disposition" means any sale, lease (other than

                  operating leases entered into in the ordinary course of

                  business), transfer or other disposition (or series of related

                  sales, leases, transfers or dispositions) by DCC or any

                  Subsidiary, including any disposition by means of a merger,

                  consolidation or similar transaction (each referred to for the

                  purposes of this definition as a "disposition"), of



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                  (i) any shares of Capital Stock of a Subsidiary (other than

                  directors' qualifying shares or shares required by applicable

                  law to be held by a Person other than DCC or a Subsidiary),

                  (ii) all or substantially all of the assets of any division or

                  line of business of DCC or any Subsidiary or (iii) any other

                  assets of DCC or any Subsidiary outside of the ordinary course

                  of business of DCC or such Subsidiary; provided, however, that

                  General Asset Dispositions shall not include (A) the sale or

                  discount, in each case without recourse, of accounts

                  receivable arising in the ordinary course of business, but

                  only in connection with the compromise or collection thereof,

                  (B) the factoring of accounts receivable arising in the

                  ordinary course of business pursuant to arrangements customary

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