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      STATES</strong></font></div>
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      AND EXCHANGE COMMISSION</strong></font></div>
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      D.C. 20549</strong></font></div>
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      8-K</strong></font></div>
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      REPORT</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Pursuant
      to Section&#160;13 or 15(d) of the Securities Exchange Act of
      1934</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date
      of
      Report (Date of earliest event reported): December 13, 2005</font></div>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><strong><font size="6">CERADYNE,
                INC.</font></strong></div>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Exact
                name of registrant as specified in its charter)</font></div>
            </td>
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            <td width="100%">&#160;</td>
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      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div>
      <table cellpadding="0" cellspacing="0" width="100%">

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            <td valign="top" width="25%" style="BORDER-BOTTOM: black thin solid">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Delaware</strong></font></div>
            </td>
            <td valign="top" width="25%" style="BORDER-BOTTOM: black thin solid">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>000-13059</strong></font></div>
            </td>
            <td valign="top" width="25%" style="BORDER-BOTTOM: black thin solid">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>33-0055414</strong></font></div>
            </td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(State
                or other jurisdiction of incorporation)</strong></font></div>
            </td>
            <td valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(Commission
                File Number)</strong></font></div>
            </td>
            <td valign="top" width="25%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(IRS
                Employer Identification
                No.)</strong></font></div>
            </td>
          </tr>

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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
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            <td valign="top" width="37%">&#160;</td>
            <td valign="top" width="37%">&#160;</td>
          </tr>
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            <td valign="top" width="37%" style="BORDER-BOTTOM: black thin solid">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>3169
                Red Hill Avenue, Costa Mesa, CA</strong></font></div>
            </td>
            <td valign="top" width="37%" style="BORDER-BOTTOM: black thin solid">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>92626</strong></font></div>
            </td>
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              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(Address
                of principal executive offices)</strong></font></div>
            </td>
            <td valign="top" width="37%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(Zip
                Code)</strong></font></div>
            </td>
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      telephone number, including area code: (714) 549-0421</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Former
      name or former address, if changed since last report: Not
      applicable</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Check
      the
      appropriate box below if the Form 8-K filing is intended to simultaneously
      satisfy the filing obligation of the registrant under any of the following
      provisions:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
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      Written
      communications pursuant to Rule 425 under the Securities Act (17 CFR
      230.425)</font></div>
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      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
      240.14a-12)</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">&#168;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
      Act
      (17 CFR 240.14d-2(b))</font></div>
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      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
      Act
      (17 CFR 240.13e-4(c))</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      1.01</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 36pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Entry
      into a Material Definitive Agreement</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Public
      Offerings of Common Stock and Senior Subordinated Convertible
      Notes</u></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
      December 13, 2005, Ceradyne, Inc. (&#8220;Ceradyne&#8221;) entered into a Purchase Agreement
      with Citigroup Global Markets Inc., acting on its behalf and as representative
      of the underwriters named in Schedule&#160;A thereto (collectively, the &#8220;Debt
      Underwriters&#8221;), a copy of which is filed herewith as Exhibit 1.1 (the &#8220;Debt
      Purchase Agreement&#8221;). Pursuant to the Debt Purchase Agreement, Ceradyne agreed
      to sell to the Underwriters $110.0 million aggregate principal amount of its
      2.875% Senior Subordinated Convertible Notes due 2035 (the &#8220;Notes&#8221;). Ceradyne
      also granted the Debt Underwriters an option to purchase up to an additional
      $11.0 million aggregate principal amount of Notes solely to cover any
      over-allotments.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Also
      on
      December 13, 2005, Ceradyne entered into a Purchase Agreement with Citigroup
      Global Markets Inc., Needham &amp; Company, LLC and Wachovia Capital Markets,
      LLC, acting on their behalf and as representatives of the underwriters named
      in
      Schedule A thereto (collectively the &#8220;Equity Underwriters&#8221;), a copy of which is
      filed herewith as Exhibit 1.2 (the &#8220;Equity Purchase Agreement&#8221;). Pursuant to the
      Equity Purchase Agreement, Ceradyne has agreed to sell to the Equity
      Underwriters 1,800,000 shares of its authorized but previously unissued common
      stock, par value $0.01 per share (the &#8220;Shares&#8221;). Ceradyne also granted the
      Equity Underwriters an option to purchase up to an additional 270,000 Shares
      solely to cover any over-allotments.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      closings of the sale of $110.0 million aggregate principal amount of Notes
      and
      the sale of 1,800,000 Shares both occurred on December 19, 2005. Both the Notes
      and Shares were sold pursuant to a registration statement on Form S-3
      (Registration No. 333-129197) filed with the Securities and Exchange Commission
      (the &#8220;Commission&#8221;) under the Securities Act of 1933, as amended (the &#8220;Act&#8221;), and
      a registration statement on Form S-3 filed with the Commission pursuant to
      Rule
      462(b) under the Act (Registration No. 333-130296). </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Notes
      are governed by the terms of an Indenture and a First Supplemental Indenture,
      each dated December 19, 2005, between Ceradyne and Union Bank of California,
      N.A., as Trustee, copies of which are filed herewith as Exhibits 4.1 and 4.2,
      respectively.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Summary
      of Terms of the Notes</u></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      Notes
      bear interest at the rate of 2.875% per year on the principal amount of the
      Notes, payable in cash semi-annually in arrears on June 15 and December 15
      of
      each year, beginning June 15, 2006. The Notes are unsecured senior subordinated
      obligations of Ceradyne and rank junior in right of payment to Ceradyne&#8217;s
      existing and future senior debt, equal in right of payment with Ceradyne&#8217;s
      existing and future senior subordinated debt, and senior in right of payment
      to
      Ceradyne&#8217;s existing and future subordinated debt. In addition, the Notes will
      effectively rank junior in right of payment to all of Ceradyne&#8217;s existing and
      future secured debt, to the extent of the value of the assets securing such
      debt, and to the debt and all other liabilities of Ceradyne&#8217;s
      subsidiaries.</font></div>
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        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: ">-2-</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Holders
      may convert their Notes based on a conversion rate of 17.1032 shares of
      Ceradyne&#8217;s common stock per $1,000 principal amount of Notes (which represents
      an initial conversion price of approximately $58.47 per share, subject to
      adjustment) only under the following circumstances: (1) if the closing sales
      price of Ceradyne&#8217;s common stock reaches, or the trading price of the Notes
      falls below, specified thresholds, (2) if the Notes are called for redemption,
      (3) if specified corporate transactions or distributions to holders of
      Ceradyne&#8217;s common stock occur, (4) if a fundamental change occurs or (5) during
      the 10 trading days prior to, but excluding, December 15, 2035. Upon conversion,
      in lieu of shares of Ceradyne&#8217;s common stock, for each $1,000 principal amount
      of Notes a holder will receive an amount in cash equal to the lesser of (i)
      $1,000 or (ii) the conversion value, determined in the manner set forth in
      this
      prospectus supplement, of the number of shares of Ceradyne&#8217;s common stock equal
      to the conversion rate. If the conversion value exceeds $1,000, Ceradyne will
      also deliver, at Ceradyne&#8217;s election, cash or common stock or a combination of
      cash and common stock with respect to the remaining common stock deliverable
      upon conversion. If a holder elects to convert its Notes in connection with
      certain fundamental changes that occur on or prior to December 15, 2012, the
      holder will also be entitled to receive a make whole premium in the form of
      an
      increase in the conversion rate. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Ceradyne
      will pay contingent interest to holders of Notes during any six-month period
      from June 15 to December 14 and from December 15 to June 14, commencing with
      the
      six-month period beginning on December 20, 2010 and ending on June 14, 2011,
      if
      the average trading price of a note for the five trading days ending on the
      third trading day immediately preceding the first day of the relevant six month
      period equals 120% or more of the principal amount of the note. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Holders
      may require Ceradyne to purchase for cash all or a portion of their Notes on
      each of December 15, 2012, December 15, 2015, December 15, 2020, December 15,
      2025 and December 15, 2030 at a purchase price equal to 100% of the principal
      amount of the Notes to be repurchased plus accrued and unpaid interest, if
      any,
      to, but excluding, the applicable purchase date. In addition, if Ceradyne
      experiences a fundamental change as described in this prospectus supplement,
      holders may require Ceradyne to purchase for cash all or a portion of their
      Notes, subject to specified exceptions, at a price equal to 100% of the
      principal amount of the Notes plus accrued and unpaid interest, if any, to,
      but
      excluding, the fundamental change repurchase date. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Ceradyne
      may from time to time on or after December 20, 2010 redeem for cash all or
      a
      portion of the Notes at redemption prices specified in the First Supplemental
      Indenture dated December 19, 2005, plus accrued and unpaid interest, if any,
      to,
      but excluding, the applicable redemption date. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>Amendment
      No. 2 to Credit Agreement</u></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      connection with the offering and sale of the Notes, Ceradyne entered into an
      Amendment No. 2, dated December 13, 2005, to the Credit Agreement dated August
      18, 2004, among Ceradyne, Ceradyne&#8217;s subsidiaries, Ceradyne ESK, LLC and ESK
      Ceramics GmbH &amp; Co. KG (collectively, the &#8220;Borrowers&#8221;), and the banks,
      financial institutions and other lenders party thereto (collectively, the
&#8220;Lenders&#8221;), and Wachovia Bank, National Association, as collateral agent and
      administrative agent for the Lenders. Amendment No. 2 amends, among other
      things, the definition of &#8220;subordinated debt&#8221; under the Credit Agreement so as
      to include the Notes, thereby allowing Ceradyne to issue the Notes without
      creating an event of default under the Credit Agreement. A copy of this
      amendment is filed herewith as Exhibit 10.1.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: ">-3-</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="3">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
      summary of the foregoing transactions are qualified in their entirety by
      reference to the text of the related agreements, which are included as exhibits
      hereto and are incorporated herein by reference.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      8.01.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 36pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Other
      Events</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
      connection with the transaction described in Item 1.01, on December 14, 2005,
      Ceradyne issued a press release announcing that it had agreed to sell 1,800,000
      shares of its common stock, plus up to an additional 270,000 shares of its
      common stock solely to cover over-allotments, at a price of $43.31 per share
      in
      an underwritten public offering. Ceradyne also announced that it had agreed
      to
      sell $110.0 million aggregate principal amount of its 2.875% Senior Subordinated
      Convertible Notes due 2035, plus up to an additional $11.0 million of Notes
      solely to cover over-allotments, in an underwritten public offering. The press
      release is filed herewith as Exhibit 99.1 and is incorporated by reference
      herein.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
      9.01.</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Financial
      Statements and Exhibits.</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">

          <tr valign="top" style="LINE-HEIGHT: 1.25">
            <td align="left" style="WIDTH: 27pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)</font></td>
            <td align="left">
              <div align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Exhibits</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">.</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div align="left">
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr bgcolor="white">
            <td valign="top" width="11%" style="BORDER-BOTTOM: black thin solid">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Exhibit
                Number</em></strong></font></div>
            </td>
            <td width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
            <td valign="top" width="80%" style="BORDER-BOTTOM: black thin solid">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Description</em></strong></font></div>
            </td>
          </tr>
          <tr bgcolor="#ccffcc">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.1</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Debt
                Purchase Agreement between Ceradyne, Inc. and the Debt Underwriters,
                dated
                December 13, 2005.</font></div>
            </td>
          </tr>
          <tr bgcolor="white">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.2</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Equity
                Purchase Agreement between Ceradyne, Inc. and the Equity Underwriters,
                dated December 13, 2005.</font></div>
            </td>
          </tr>
          <tr bgcolor="#ccffcc">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.1</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indenture
                dated December 19, 2005, between Ceradyne, Inc. and Union Bank of
                California, N.A., as Trustee.</font></div>
            </td>
          </tr>
          <tr bgcolor="white">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.2</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">First
                Supplemental Indenture dated December 19, 2005, between Ceradyne,
                Inc. and
                Union Bank of California, N.A., as Trustee.</font></div>
            </td>
          </tr>
          <tr bgcolor="#ccffcc">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.3</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Form
                of 2.875% Senior Subordinated Convertible Note due
                2035.</font></div>
            </td>
          </tr>
          <tr bgcolor="white">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.1</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Opinion
                of Stradling Yocca Carlson &amp; Rauth, a Professional
                Corporation.</font></div>
            </td>
          </tr>
          <tr bgcolor="#ccffcc">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.1</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Amendment
                No. 2 to Credit Agreement, dated December 13, 2005, between Ceradyne,
                Inc., Ceradyne ESK, LLC and ESK Ceramics GmbH &amp; Co. KG (collectively,
                the &#8220;Borrowers&#8221;), and the banks, financial institutions and other lenders
                party thereto (collectively, the &#8220;Lenders&#8221;), and Wachovia Bank, National
                Association, as collateral agent and administrative agent for the
                Lenders.</font></div>
            </td>
          </tr>
          <tr bgcolor="white">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">23.1</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Consent
                of Stradling Yocca Carlson &amp; Rauth, a Professional Corporation
                (included in its opinion filed as Exhibit 5.1 hereto).</font></div>
            </td>
          </tr>
          <tr bgcolor="#ccffcc">
            <td valign="top" width="11%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.1</font></div>
            </td>
            <td width="2%">&#160;</td>
            <td align="left" valign="top" width="80%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Ceradyne&#8217;s
                press release, dated December 14,
                2005.</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: -36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: ">-4-</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="3">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: -36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SIGNATURES</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the requirements of the Securities Exchange Act of 1934, the Registrant
      has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">
      <table align="center" bgcolor="#ffffff" border="0" cellpadding="0" cellspacing="0" width="100%">

          <tr valign="top" bgcolor="#ffffff">
            <td width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td width="49%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td colspan="2"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: "><strong>CERADYNE,
              INC.</strong></font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;<br>&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;<br>&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;<br>&#160;</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">Date:&#160;December
              19, 2005</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">By:&#160;&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">/s/&#160;JERROLD
              J. PELLIZZON</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td colspan="2"><font style="FONT-FAMILY: " size="1">&#160;</font></td>
            <td align="left">
              <hr style="COLOR: black" align="left" noshade size="2" width="80%">
            </td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td colspan="2"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td>
              <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">Name:&#160;&#160;
                Jerrold J. Pellizzon</font></div>
              <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">Title:&#160;&#160;&#160;
                Chief Financial Officer, Vice President and
                Secretary</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; MARGIN-LEFT: 216pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
      <div id="FTR">
        <div id="GLFTR" style="WIDTH: 100%" align="left">
        </div>
      </div>
      <div id="PN" style="PAGE-BREAK-AFTER: always">
        <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 8pt; FONT-FAMILY: ">-5-</font></div>
        <div style="WIDTH: 100%; TEXT-ALIGN: center">
          <hr style="COLOR: black" noshade size="3">
        </div>
      </div>
      <div id="HDR">
        <div id="GLHDR" style="WIDTH: 100%" align="right">
        </div>
      </div>
    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>EXHIBIT
      INDEX</strong></font></div>
    <div>
      <div align="left">
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%" style="BORDER-BOTTOM: black thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Exhibit
                  Number</em></strong></font></div>
              </td>
              <td width="2%" style="BORDER-BOTTOM: #ffffff solid">&#160;</td>
              <td valign="top" width="80%" style="BORDER-BOTTOM: black thin solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong><em>Description</em></strong></font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.1</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Debt
                  Purchase Agreement between Ceradyne, Inc. and the Debt Underwriters,
                  dated
                  December 13, 2005.</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.2</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Equity
                  Purchase Agreement between Ceradyne, Inc. and the Equity Underwriters,
                  dated December 13, 2005.</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.1</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Indenture
                  dated December 19, 2005, between Ceradyne, Inc. and Union Bank
                  of
                  California, N.A., as Trustee.</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.2</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">First
                  Supplemental Indenture dated December 19, 2005, between Ceradyne,
                  Inc. and
                  Union Bank of California, N.A., as Trustee.</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.3</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Form
                  of 2.875% Senior Subordinated Convertible Note due
                  2035.</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.1</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Opinion
                  of Stradling Yocca Carlson &amp; Rauth, a Professional
                  Corporation.</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.1</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Amendment
                  No. 2 to Credit Agreement, dated December 13, 2005, between Ceradyne,
                  Inc., Ceradyne ESK, LLC and ESK Ceramics GmbH &amp; Co. KG (collectively,
                  the &#8220;Borrowers&#8221;), and the banks, financial institutions and other lenders
                  party thereto (collectively, the &#8220;Lenders&#8221;), and Wachovia Bank, National
                  Association, as collateral agent and administrative agent for the
                  Lenders.</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">23.1</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Consent
                  of Stradling Yocca Carlson &amp; Rauth, a Professional Corporation
                  (included in its opinion filed as Exhibit 5.1 hereto).</font></div>
              </td>
            </tr>
            <tr bgcolor="white">
              <td valign="top" width="11%">&#160;</td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">&#160;</td>
            </tr>
            <tr bgcolor="#ccffcc">
              <td valign="top" width="11%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.1</font></div>
              </td>
              <td width="2%">&#160;</td>
              <td align="left" valign="top" width="80%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Ceradyne&#8217;s
                  press release, dated December 14,
                  2005.</font></div>
              </td>
            </tr>

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{"company-data": {"conformed-name": "CERADYNE INC", "cik": "0000018937", "assigned-sic": "3990", "irs-number": "330055414", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-13059", "film-number": "051271340"}, "business-address": {"street1": "3169 RED HILL", "city": "COSTA MESA", "state": "CA", "zip": "92626", "phone": "7145490421"}, "mail-address": {"street2": "3169 RED HILL", "city": "COSTA MESA", "state": "CA", "zip": "92626"}}
UNITED
      STATES
SECURITIES
      AND EXCHANGE COMMISSION
Washington,
      D.C. 20549
FORM
      8-K
CURRENT
      REPORT
Pursuant
      to Section 13 or 15(d) of the Securities Exchange Act of
      1934
Date
      of
      Report (Date of earliest event reported): December 13, 2005
CERADYNE,
                INC.
(Exact
                name of registrant as specified in its charter)
Delaware
000-13059
33-0055414
(State
                or other jurisdiction of incorporation)
(Commission
                File Number)
(IRS
                Employer Identification
                No.)
3169
                Red Hill Avenue, Costa Mesa, CA
92626
(Address
                of principal executive offices)
(Zip
                Code)
Registrant's
      telephone number, including area code: (714) 549-0421
Former
      name or former address, if changed since last report: Not
      applicable
Check
      the
      appropriate box below if the Form 8-K filing is intended to simultaneously
      satisfy the filing obligation of the registrant under any of the following
      provisions:
¨
Written
      communications pursuant to Rule 425 under the Securities Act (17 CFR
      230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
      240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
      Act
      (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
      Act
      (17 CFR 240.13e-4(c))
Item
      1.01
Entry
      into a Material Definitive Agreement
Public
      Offerings of Common Stock and Senior Subordinated Convertible
      Notes
On
      December 13, 2005, Ceradyne, Inc. ("Ceradyne") entered into a Purchase Agreement
      with Citigroup Global Markets Inc., acting on its behalf and as representative
      of the underwriters named in Schedule A thereto (collectively, the "Debt
      Underwriters"), a copy of which is filed herewith as Exhibit 1.1 (the "Debt
      Purchase Agreement"). Pursuant to the Debt Purchase Agreement, Ceradyne agreed
      to sell to the Underwriters $110.0 million aggregate principal amount of its
      2.875% Senior Subordinated Convertible Notes due 2035 (the "Notes"). Ceradyne
      also granted the Debt Underwriters an option to purchase up to an additional
      $11.0 million aggregate principal amount of Notes solely to cover any
      over-allotments.
Also
      on
      December 13, 2005, Ceradyne entered into a Purchase Agreement with Citigroup
      Global Markets Inc., Needham & Company, LLC and Wachovia Capital Markets,
      LLC, acting on their behalf and as representatives of the underwriters named
      in
      Schedule A thereto (collectively the "Equity Underwriters"), a copy of which is
      filed herewith as Exhibit 1.2 (the "Equity Purchase Agreement"). Pursuant to the
      Equity Purchase Agreement, Ceradyne has agreed to sell to the Equity
      Underwriters 1,800,000 shares of its authorized but previously unissued common
      stock, par value $0.01 per share (the "Shares"). Ceradyne also granted the
      Equity Underwriters an option to purchase up to an additional 270,000 Shares
      solely to cover any over-allotments.
The
      closings of the sale of $110.0 million aggregate principal amount of Notes
      and
      the sale of 1,800,000 Shares both occurred on December 19, 2005. Both the Notes
      and Shares were sold pursuant to a registration statement on Form S-3
      (Registration No. 333-129197) filed with the Securities and Exchange Commission
      (the "Commission") under the Securities Act of 1933, as amended (the "Act"), and
      a registration statement on Form S-3 filed with the Commission pursuant to
      Rule
      462(b) under the Act (Registration No. 333-130296).
The
      Notes
      are governed by the terms of an Indenture and a First Supplemental Indenture,
      each dated December 19, 2005, between Ceradyne and Union Bank of California,
      N.A., as Trustee, copies of which are filed herewith as Exhibits 4.1 and 4.2,
      respectively.
Summary
      of Terms of the Notes
The
      Notes
      bear interest at the rate of 2.875% per year on the principal amount of the
      Notes, payable in cash semi-annually in arrears on June 15 and December 15
      of
      each year, beginning June 15, 2006. The Notes are unsecured senior subordinated
      obligations of Ceradyne and rank junior in right of payment to Ceradyne's
      existing and future senior debt, equal in right of payment with Ceradyne's
      existing and future senior subordinated debt, and senior in right of payment
      to
      Ceradyne's existing and future subordinated debt. In addition, the Notes will
      effectively rank junior in right of payment to all of Ceradyne's existing and
      future secured debt, to the extent of the value of the assets securing such
      debt, and to the debt and all other liabilities of Ceradyne's
      subsidiaries.
-2-
Holders
      may convert their Notes based on a conversion rate of 17.1032 shares of
      Ceradyne's common stock per $1,000 principal amount of Notes (which represents
      an initial conversion price of approximately $58.47 per share, subject to
      adjustment) only under the following circumstances: (1) if the closing sales
      price of Ceradyne's common stock reaches, or the trading price of the Notes
      falls below, specified thresholds, (2) if the Notes are called for redemption,
      (3) if specified corporate transactions or distributions to holders of
      Ceradyne's common stock occur, (4) if a fundamental change occurs or (5) during
      the 10 trading days prior to, but excluding, December 15, 2035. Upon conversion,
      in lieu of shares of Ceradyne's common stock, for each $1,000 principal amount
      of Notes a holder will receive an amount in cash equal to the lesser of (i)
      $1,000 or (ii) the conversion value, determined in the manner set forth in
      this
      prospectus supplement, of the number of shares of Ceradyne's common stock equal
      to the conversion rate. If the conversion value exceeds $1,000, Ceradyne will
      also deliver, at Ceradyne's election, cash or common stock or a combination of
      cash and common stock with respect to the remaining common stock deliverable
      upon conversion. If a holder elects to convert its Notes in connection with
      certain fundamental changes that occur on or prior to December 15, 2012, the
      holder will also be entitled to receive a make whole premium in the form of
      an
      increase in the conversion rate.
Ceradyne
      will pay contingent interest to holders of Notes during any six-month period
      from June 15 to December 14 and from December 15 to June 14, commencing with
      the
      six-month period beginning on December 20, 2010 and ending on June 14, 2011,
      if
      the average trading price of a note for the five trading days ending on the
      third trading day immediately preceding the first day of the relevant six month
      period equals 120% or more of the principal amount of the note.
Holders
      may require Ceradyne to purchase for cash all or a portion of their Notes on
      each of December 15, 2012, December 15, 2015, December 15, 2020, December 15,
      2025 and December 15, 2030 at a purchase price equal to 100% of the principal
      amount of the Notes to be repurchased plus accrued and unpaid interest, if
      any,
      to, but excluding, the applicable purchase date. In addition, if Ceradyne
      experiences a fundamental change as described in this prospectus supplement,
      holders may require Ceradyne to purchase for cash all or a portion of their
      Notes, subject to specified exceptions, at a price equal to 100% of the
      principal amount of the Notes plus accrued and unpaid interest, if any, to,
      but
      excluding, the fundamental change repurchase date.
Ceradyne
      may from time to time on or after December 20, 2010 redeem for cash all or
      a
      portion of the Notes at redemption prices specified in the First Supplemental
      Indenture dated December 19, 2005, plus accrued and unpaid interest, if any,
      to,
      but excluding, the applicable redemption date.
Amendment
      No. 2 to Credit Agreement
In
      connection with the offering and sale of the Notes, Ceradyne entered into an
      Amendment No. 2, dated December 13, 2005, to the Credit Agreement dated August
      18, 2004, among Ceradyne, Ceradyne's subsidiaries, Ceradyne ESK, LLC and ESK
      Ceramics GmbH & Co. KG (collectively, the "Borrowers"), and the banks,
      financial institutions and other lenders party thereto (collectively, the
"Lenders"), and Wachovia Bank, National Association, as collateral agent and
      administrative agent for the Lenders. Amendment No. 2 amends, among other
      things, the definition of "subordinated debt" under the Credit Agreement so as
      to include the Notes, thereby allowing Ceradyne to issue the Notes without
      creating an event of default under the Credit Agreement. A copy of this
      amendment is filed herewith as Exhibit 10.1.
-3-
The
      summary of the foregoing transactions are qualified in their entirety by
      reference to the text of the related agreements, which are included as exhibits
      hereto and are incorporated herein by reference.
Item
      8.01.
Other
      Events
In
      connection with the transaction described in Item 1.01, on December 14, 2005,
      Ceradyne issued a press release announcing that it had agreed to sell 1,800,000
      shares of its common stock, plus up to an additional 270,000 shares of its
      common stock solely to cover over-allotments, at a price of $43.31 per share
      in
      an underwritten public offering. Ceradyne also announced that it had agreed
      to
      sell $110.0 million aggregate principal amount of its 2.875% Senior Subordinated
      Convertible Notes due 2035, plus up to an additional $11.0 million of Notes
      solely to cover over-allotments, in an underwritten public offering. The press
      release is filed herewith as Exhibit 99.1 and is incorporated by reference
      herein.
Item
      9.01.
Financial
      Statements and Exhibits.
(c)
Exhibits
.
Exhibit
                Number
Description
1.1
Debt
                Purchase Agreement between Ceradyne, Inc. and the Debt Underwriters,
                dated
                December 13, 2005.
1.2
Equity
                Purchase Agreement between Ceradyne, Inc. and the Equity Underwriters,
                dated December 13, 2005.
4.1
Indenture
                dated December 19, 2005, between Ceradyne, Inc. and Union Bank of
                California, N.A., as Trustee.
4.2
First
                Supplemental Indenture dated December 19, 2005, between Ceradyne,
                Inc. and
                Union Bank of California, N.A., as Trustee.
4.3
Form
                of 2.875% Senior Subordinated Convertible Note due
                2035.
5.1
Opinion
                of Stradling Yocca Carlson & Rauth, a Professional
                Corporation.
10.1
Amendment
                No. 2 to Credit Agreement, dated December 13, 2005, between Ceradyne,
                Inc., Ceradyne ESK, LLC and ESK Ceramics GmbH & Co. KG (collectively,
                the "Borrowers"), and the banks, financial institutions and other lenders
                party thereto (collectively, the "Lenders"), and Wachovia Bank, National
                Association, as collateral agent and administrative agent for the
                Lenders.
23.1
Consent
                of Stradling Yocca Carlson & Rauth, a Professional Corporation
                (included in its opinion filed as Exhibit 5.1 hereto).
99.1
Ceradyne's
                press release, dated December 14,
                2005.
-4-
SIGNATURES
Pursuant
      to the requirements of the Securities Exchange Act of 1934, the Registrant
      has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized.
CERADYNE,
              INC.
Date: December
              19, 2005
By:
/s/ JERROLD
              J. PELLIZZON
Name:  
                Jerrold J. Pellizzon
Title:   
                Chief Financial Officer, Vice President and
                Secretary
-5-
EXHIBIT
      INDEX
Exhibit
                  Number
Description
1.1
Debt
                  Purchase Agreement between Ceradyne, Inc. and the Debt Underwriters,
                  dated
                  December 13, 2005.
1.2
Equity
                  Purchase Agreement between Ceradyne, Inc. and the Equity Underwriters,
                  dated December 13, 2005.
4.1
Indenture
                  dated December 19, 2005, between Ceradyne, Inc. and Union Bank
                  of
                  California, N.A., as Trustee.
4.2
First
                  Supplemental Indenture dated December 19, 2005, between Ceradyne,
                  Inc. and
                  Union Bank of California, N.A., as Trustee.
4.3
Form
                  of 2.875% Senior Subordinated Convertible Note due
                  2035.
5.1
Opinion
                  of Stradling Yocca Carlson & Rauth, a Professional
                  Corporation.
10.1
Amendment
                  No. 2 to Credit Agreement, dated December 13, 2005, between Ceradyne,
                  Inc., Ceradyne ESK, LLC and ESK Ceramics GmbH & Co. KG (collectively,
                  the "Borrowers"), and the banks, financial institutions and other lenders
                  party thereto (collectively, the "Lenders"), and Wachovia Bank, National
                  Association, as collateral agent and administrative agent for the
                  Lenders.
23.1
Consent
                  of Stradling Yocca Carlson & Rauth, a Professional Corporation
                  (included in its opinion filed as Exhibit 5.1 hereto).
99.1
Ceradyne's
                  press release, dated December 14,
                  2005.
-6-