<PAGE>   1
                                                                   EXHIBIT 10.37

                                CREDIT AGREEMENT

        THIS CREDIT AGREEMENT (as it may be amended, supplemented or otherwise
modified from time to time, this "Agreement") is entered into as of the 1st day
of November, 1997, by and between Showscan Entertainment Inc., a Delaware
corporation ("Borrower"), and Eldee Foundation, a Canadian non-profit charitable
foundation ("Lender").

                                     RECITAL

        Borrower has requested from Lender the loan described below and Lender
has agreed to provide the loan to Borrower on the terms and conditions contained
herein.

                                    AGREEMENT

        NOW, THEREFORE, Lender and Borrower hereby agree as follows:

                                    ARTICLE I

        SECTION 1.1.  TERM LOAN.

        (a) TERM LOAN. Subject to the terms and conditions of this Agreement,
Lender hereby agrees to make a loan to Borrower in the principal amount of One
Million United States Dollars (USD$1,000,000) (the "Term Loan"), the proceeds of
which shall be used for general corporate purposes as determined by Borrower.
Borrower's obligation to repay the Term Loan shall be evidenced by a promissory
note substantially in the form of Exhibit A attached hereto (as it may be
amended, the "Note"), all terms of which are incorporated herein by this
reference.

        (b) REPAYMENT. The principal amount of the Term Loan shall be due and
payable in full on November 15, 1998. Upon twenty (20) days prior written notice
to Borrower, Lender may demand payment in full of the Term Loan at any time at
least six months after the closing of a merger of Borrower with another entity.

        (c) PREPAYMENT. Borrower may prepay principal on the Term Loan at any
time, and from time to time, in any amount and without penalty.



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        SECTION 1.2.  INTEREST/FEES.

        (a) INTEREST. Subject to Section 1.2(b), the outstanding principal
balance of the Term Loan shall bear interest at a rate per annum equal to eleven
percent (11%).

        (b) DEFAULT INTEREST. At all times when an Event of Default has occurred
and is continuing, the outstanding principal balance of the Term Loan shall bear
interest at a rate per annum equal to thirteen percent (13%)(the "Default
Rate"). In addition, to the extent permitted by applicable law, any interest
payments, fees or other amounts owed hereunder and not paid when due, in each
case whether at stated maturity, by notice of prepayment, by acceleration or
otherwise, shall bear interest at the Default Rate. Payment or acceptance of the
Default Rate is not a permitted alternative to timely payment and shall not
constitute a waiver of any Event of Default or otherwise prejudice or limit any
rights or remedies of Lender.

        (c) COMPUTATION AND PAYMENT. Interest on the principal amount
outstanding under the Term Loan shall be computed on the basis of a 365-day
year, actual days elapsed and shall be payable at maturity so long as any
principal under the Term Loan is unpaid. If Borrower shall prepay any of the
principal balance of the Term Loan or if Lender shall demand prepayment of the
Term Loan in accordance with Section 1.1(b) hereof, then Borrower shall also pay
at such time the accrued and unpaid interest with respect to the portion of the
principal prepaid.

        (d) CLOSING FEE. Borrower shall pay to Lender a non-refundable
commitment fee of USD$70,000, which commitment fee shall be due and payable in
full on closing. Borrower shall also pay to Hugi Bank AG a non-refundable
finders fee of USD$30,000, which finders fee shall be due and payable in full on
closing.

        SECTION 1.3. COLLATERAL. In order to secure the payment and performance
by Borrower of all of its obligations under this Agreement and the Note,
Borrower hereby grants to Lender a security interest in all of Borrower's right,
title and interest in and to, in each case whether now existing or hereafter
acquired and wherever located, all of the following but in each case only to the
extent that each item is derived from or relates to the films, motions pictures
or videos developed (or in development), 



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produced, distributed or obtained for distribution by Borrower (directly or
indirectly) for release in any medium (the "Collateral"): accounts, accounts
receivable and other rights to payment of money, chattel paper, contract rights,
documents, instruments, cash, and all other personal property and all proceeds
arising therefrom. Borrower shall execute and deliver any financing or
continuation statements and such other instruments or notices as may be
reasonably necessary in order to perfect and preserve the security interest
granted hereby.

                                   ARTICLE II
                         REPRESENTATIONS AND WARRANTIES

        Borrower makes the following representations and warranties to Lender,
which representations and warranties shall survive the execution of this
Agreement and shall continue in full force and effect until the full and final
payment, and satisfaction and discharge, of all obligations of Borrower to
Lender subject to this Agreement.

        SECTION 2.1. LEGAL STATUS; ORGANIZATIONAL DOCUMENTS. Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and is qualified or licensed to do business, and is in
good standing as a foreign corporation, if applicable, in all jurisdictions in
which such qualification or licensing is required or in which the failure to so
qualify or to be so licensed could have a material adverse effect on Borrower.

        SECTION 2.2. AUTHORIZATION AND VALIDITY. This Agreement, the Note, and
each other document, contract and instrument required by or at any time
delivered to Lender in connection with this Agreement (with all of the foregoing
referred to herein collectively as the "Loan Documents") have been duly
authorized by Borrower, and upon their execution and delivery in accordance with
the provisions hereof will constitute legally valid and binding agreements and
obligations of Borrower, enforceable in accordance with their respective terms.

        SECTION 2.3. NO VIOLATION. The execution, delivery and performance by
Borrower of each of the Loan Documents to which it is a party do not violate any
provision of any law or regulation, or contravene any provision of Borrower's
Articles of 



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Incorporation or Bylaws or result in a breach of or constitute a default under
any material contract, obligation, indenture or other instrument to which
Borrower is a party or by which Borrower or any of its properties may be bound.

                                   ARTICLE III
                               NEGATIVE COVENANTS

        Borrower covenants that if (a) the merger between Borrower and Iwerks
Entertainment, Inc. has not occurred, and (b) Borrower's (in each case as
audited and reported in its Annual Report on Form 10-K)(i) gross revenues for
its fiscal year ending March 31, 1998 do not equal or exceed USD$15,000,000, or
(ii) net profit for the six month period ending March 31, 1998 does not equal or
exceed USD$1,500,000, then until payment in full of the Term Loan, Borrower will
not without the prior written consent of Bank:

        SECTION 3.1. CASH INVESTMENT IN OWNED AND OPERATED THEATRES. Make any
cash investments in new motion simulation theatre attractions for its own
account, provided, however, that the foregoing shall not prohibit the sale by
lease, installment or other financing method of a theatre system or the
renovation or improvement of any existing owned and operated theatre, nor shall
it prevent the periodic provision of working capital to one or more of such
existing theatres.

        SECTION 3.2. FILM EXPENDITURES. Incur new obligations for the
production, pick up or acquisition of distribution rights to, any motion
picture, where such obligations would require cash aggregate payments prior to
the maturity date of the Term Loan in excess of USD$1,000,000.

                                   ARTICLE IV
                                EVENTS OF DEFAULT

        SECTION 4.1. The occurrence of any of the following shall constitute an
"Event of Default" under this Agreement:

        (a) Borrower shall fail to pay within ten (10) days of the date due any
principal, interest, fees or other amounts payable under any of the Loan
Documents.



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        (b) Any representation or warranty made or deemed made by Borrower
hereunder shall prove to be false, incorrect or incomplete in any material
respect when furnished, made or deemed made.

        (c) Any default in the performance of or compliance with any obligation,
agreement or other provision contained herein (other than those referred to in
Sections 4.1(a) and (b) above), and with respect to any such default which by
its nature can be cured, such default shall continue without cure for a period
of thirty (30) days from its occurrence.

        (d) Any default in the payment or performance of any obligation, or any
defined event of default, under any of the Loan Documents other than this
Agreement, and with respect to any such default which by its nature can be
cured, such default shall continue without cure for a period of thirty (30) days
from its occurrence.

        (e) Borrower shall become insolvent, or shall suffer or consent to or
apply for the appointment of a receiver, trustee, custodian or liquidator of
itself or any of its property, or shall generally fail to pay its debts as they
become due, or shall make a general assignment for the benefit of creditors;
Borrower shall file a voluntary petition in bankruptcy, or seeking
reorganization, in order to effect a plan or other arrangement with creditors or
any other relief under the Bankruptcy Reform Act, Title 11 of the United States
Code, as amended or recodified from time to time or any successor statute
("Bankruptcy Code"), or under any state or federal law granting relief to
debtors, whether now or hereafter in effect; or any involuntary petition or
proceeding pursuant to said Bankruptcy Code or any other applicable state or
federal law relating to bankruptcy, reorganization or other relief for debtors
is filed or commenced against Borrower, or Borrower shall file an answer
admitting the jurisdiction of the court and the material allegations of any
involuntary petition; or Borrower shall be adjudicated a bankrupt, or an order
for relief shall be entered by any court of competent jurisdiction under said
Bankruptcy Code or any other applicable state or federal law relating to
bankruptcy, reorganization or other relief for debtors.



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        SECTION 4.2. REMEDIES. If an Event of Default shall have occurred and be
continuing, (a) any indebtedness of Borrower under any of the Loan Documents,
any term thereof to the contrary notwithstanding, shall (automatically and
without further action, in the case of an Event of Default under Section 4.1(e)
and, in all other cases, at Lender's option and without notice) become
immediately due and payable without presentment, demand, protest or notice of
dishonor, all of which are hereby expressly waived by Borrower; (b) the
obligation, if any, of Lender to permit further borrowings hereunder shall
immediately cease and terminate; and (c) Lender shall have all rights, powers
and remedies available under each of the Loan Documents, or accorded by law,
including without limitation the right to resort to any or all security for any
of the Credits and to exercise any or all of the rights of a beneficiary or
secured party pursuant to applicable law. All rights, powers and remedies of
Lender in connection with each of the Loan Documents may be exercised at any
time by Lender and from time to time after the occurrence and during the
continuance of an Event of Default, are cumulative and not exclusive, and shall
be in addition to any other rights, powers or remedies provided by law or
equity.

                                    ARTICLE V
                                  MISCELLANEOUS

        SECTION 5.1. NO WAIVER. No delay, failure or discontinuance of Lender in
exercising any right, power or remedy under any of the Loan Documents shall
affect or operate as a waiver of such right, power or remedy; nor shall any
single or partial exercise of any such right, power or remedy preclude, waive or
otherwise affect any other or further exercise thereof or the exercise of any
other right, power or remedy. Any waiver, permit, consent or approval of any
kind by Lender of any breach of or default under any of the Loan Documents must
be in writing and shall be effective only to the extent expressly set forth in
such writing.

        SECTION 5.2. NOTICES. All notices, requests and demands which any party
is required or may desire to give to any other party under any provision of this
Agreement must be in writing delivered to each party at the following address:



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        BORROWER:     Showscan Entertainment Inc.
                      3939 Landmark Street
                      Culver City, California, USA
                      Telecopier Number: 310-559-7984
                      Attn: President and Chief Executive Officer

        LENDER:       Eldee Foundation
                      1080 Beaver Hall Hill
                      Suite 1720
                      Montreal, Quebec, H2Z 1S8
                      Telecopier Number: 514-871-9261
                      Attn: ____________________

or to such other address as any party may designate by written notice to all
other parties. Each such notice, request and demand shall be deemed given or
made as follows: (a) if sent by hand delivery, upon delivery; (b) if sent by
mail, upon the earlier of the date of receipt or three (3) days after deposit in
the U.S. mail, first class and postage prepaid; and (c) if sent by telecopy,
upon receipt.

        SECTION 5.3. SUCCESSORS, ASSIGNMENT. This Agreement shall be binding on
and inure to the benefit of the heirs, executors, administrators, legal
representatives, successors and assigns of the parties; provided however, that
Borrower may not assign or transfer its interest hereunder without the prior
written consent of Lender.

        SECTION 5.4. ENTIRE AGREEMENT; COUNTERPARTS; AMENDMENT. This Agreement
and each of the other Loan Documents constitute the entire agreement between
Borrower and Lender with respect to the Term Loan and supersede all prior
negotiations, communications, discussions and correspondence concerning the
subject matter hereof. This Agreement may be executed in any number of
counterparts and may be amended or modified only by a written instrument
executed by each party hereto.

        SECTION 5.5. NO THIRD PARTY BENEFICIARIES. This Agreement is made and
entered into for the sole protection and benefit of the parties hereto and their
respective permitted successors and assigns, and no other person or entity shall
be a third party beneficiary of, or have any direct or indirect cause of action
or 



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claim in connection with, this Agreement or any other of the Loan Documents
to which it is not a party.

        SECTION 5.6.  TIME IS OF THE ESSENCE.  Time is of the
essence of each and every provision of this Agreement and each of
the other Loan Documents.

        SECTION 5.7. SEVERABILITY OF PROVISIONS. If any provision of this
Agreement shall be prohibited by or invalid under applicable law, such provision
shall be ineffective only to the extent of such prohibition or invalidity
without invalidating the remainder of such provision or any remaining provisions
of this Agreement.

        SECTION 5.8.  GOVERNING LAW.  This Agreement shall be
governed by and construed in accordance with the internal laws of
the State of California.

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first written above.

                                                ELDEE FOUNDATION


                                                By: \s\ HARRY BLOOMFIELD
                                                   -----------------------------
                                                     Harry Bloomfield
                                                Title: Vice President & Director
                                                      --------------------------

                                                SHOWSCAN ENTERTAINMENT INC.


                                                By: \s\ DENNIS POPE
                                                   -----------------------------
                                                     Dennis Pope
                                                Title: President & CEO
                                                      --------------------------



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                                    EXHIBIT A

                            TERM LOAN PROMISSORY NOTE


                                                         Culver City, California
                                                                November 1, 1997

USD$1,000,000

               FOR VALUE RECEIVED, Showscan Entertainment Inc., a Delaware
corporation (the "Company"), promises to pay to the order of Eldee Foundation,
or order (collectively, "Payee"), on or before November 15, 1998, the lesser of
(i) USD$1,000,000 and (ii) the then unpaid principal balance of this Note.

               The Company also promises to pay interest on the unpaid principal
amount hereof from the date hereof until paid in full at the rates and at the
times which shall be determined in accordance with the provisions of that
certain Credit Agreement, dated as of November 1, 1997, by and between the
Company and Payee (such agreement, as it may be amended, modified or
supplemented from time to time, the "Credit Agreement"). Capitalized terms used
herein without definition shall have the meanings set forth in the Credit
Agreement.

               This Note is the Company's "Term Note" and is issued pursuant to
and entitled to the benefits of the Credit Agreement to which reference is
hereby made for a more complete statement of the terms and conditions under
which the advances evidenced hereby were made and are to be repaid.

               All payments of principal and interest in respect of this Note
shall be made in lawful money of the United States of America in same day funds
at the office of Payee located at 1080 Beaver Hall Hill, Suite 1720, Montreal,
Quebec, H2Z 1S8, or at such other place as shall be designated in writing for
such purpose in accordance with the notice provisions of the Credit Agreement.

               Whenever any payment on this Note shall be stated to be due on a
day which is not a business day, such payment shall be made on the next
succeeding business day and such extension of 



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time shall be included in the computation of the payment of interest on this
Note.

               This Note is subject to repayment and mandatory prepayment as,
and to the extent, provided in the Credit Agreement and prepayment at the option
of the Company as provided in the Credit Agreement.


               THIS NOTE SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF CALIFORNIA
WITHOUT REGARD TO CONFLICTS OF LAW PROVISIONS.

               Upon the occurrence and during the continuance of an Event of
Default, the unpaid balance of the principal amount of this Note and all other
obligations of the Company under the Credit Agreement, together with all accrued
but unpaid interest thereon, may automatically become, or may be declared to be,
due and payable in the manner, upon the conditions and with the effect provided
in the Credit Agreement.

               The obligation of the Company to pay the principal of and
interest on this Note at the place, at the respective times, and in the currency
herein prescribed is absolute and unconditional.

               The Company and endorsers of this Note hereby consent to renewals
and extensions of time at or after the maturity hereof, without notice, and
hereby waive diligence, presentment, protest, demand and notice of every kind
and, to the full extent permitted by law, the right to plead any statute of
limitations as a defense to any demand hereunder. The terms of this Note are
subject to amendment only in the manner provided in the Credit Agreement.

               IN WITNESS WHEREOF, the Company has caused this Note to be
executed and delivered by its duly authorized officer, as of the day and year
and at the place first above written.

                                                   SHOWSCAN ENTERTAINMENT INC.


                                                    By: \s\ DENNIS POPE
                                                       -------------------------
                                                    Name: Dennis Pope
                                                         -----------------------
                                                    Title:President & CEO
                                                          ----------------------



                                       A-2