AGREEMENT


AMENDED  AND  RESTATED  AGREEMENT,   restated  as  of  December  31,  1992  (the
"Agreement") between KERR-McGEE  CORPORATION,  a Delaware corporation having its
executive  offices at Oklahoma City,  Oklahoma (the  "Company"),  and Russell G.
Homer,  Jr.,  residing in Oklahoma  City,  Oklahoma  (the  "Executive").  Unless
otherwise  indicated,  terms used herein and defined in Schedule A and  Schedule
I-A to Annexure 1 shall have the meanings assigned to them in said Schedules, as
applicable.

WHEREAS,  the  Executive  is  currently  employed  by  the  Company  and/or  its
Subsidiaries  pursuant  to an amended  and  restated  agreement,  restated as of
February 1, 1988 (the "Existing Agreement"); and

WHEREAS,  the Executive and the Company's  Board of Directors  believe that such
Existing Agreement,  which is a three-year  self-renewing  employment agreement,
should be amended and restated as of December 31, 1992; and

WHEREAS,  the  Company's  Board of Directors  has  determined  that it wishes to
continue the employment of the Executive and that it is appropriate to reinforce
the continued  attention and dedication of the Executive to his assigned  duties
without  distraction in potentially  disturbing  circumstances  arising from the
possibility of a Change of Control of the Company; and

WHEREAS,  the  Company  and the  Executive  now wish to amend  and  restate  the
Existing Agreement.

NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set
forth, the Company and the Executive agree as follows:

1. Operation of Agreement: From the effective date of this Agreement through and
including  January 31, 1996, or the occurrence of a Change of Control as defined
in  Schedule  A,  whichever  occurs  earlier  (the  earlier of such dates  being
referred to as the "Annexure 1 Effective  Date"),  the  operative  provisions of
this Agreement shall be as set forth in Sections 2 through 19 below and Schedule
A hereto.  Beginning the Annexure 1 Effective Date, the operative  provisions of
this Agreement  shall be as set forth in Annexure 1 hereto,  including  Schedule
I-A thereto  (the  "Annexure 1  Provisions").  When used in Annexure 1, the term
"Agreement"  shall  refer to and mean  Annexure  1.  Beginning  the  Annexure  1
Effective  Date,  the  operative  provisions  of this  Agreement as set forth in
Sections 2 through 19 and  Schedule A shall be  superseded  and  replaced by the
Annexure 1 Provisions.

2.  Employment:  The Company  agrees to continue to employ the  Executive and he
agrees to continue to serve the Company and its Subsidiaries, upon the terms and
conditions  stated  herein,  for the term of  employment  commencing on the date
hereof and ending on January 31, 1996,  unless such employment is (i) prior to a
Change of Control,  involuntarily terminated hereunder for Reason or as a result
of the  Executive's  death or  disability  or (ii)  subsequent  to a  Change  of
Control,  involuntarily  terminated  hereunder  for  Cause or as a result of the
Executive's  death or Disability  or  terminated  hereunder by the Executive for
Good Reason.  Following a Change of Control any  involuntary  termination of the
Executive's  employment  hereunder  for any reason  other  than  death  shall be
communicated  by a Notice of  Termination.  The Executive will be employed in an
executive  capacity  and will perform the duties of Vice  President  and General
Counsel or such other  duties as may be assigned to him from time to time by the
Company.

The Executive shall devote  substantially  all of his business time,  attention,
skill and efforts to the  business of the  Company  and its  Subsidiaries  while
employed  hereunder  and shall  perform the duties of his position and any other
duties assigned to him by the Company to the best of his ability.

3. Compensation: As compensation for his services, the Company agrees to pay the
Executive,  so long as he shall be employed hereunder,  a salary determined from
time to time by the Company,  but at a rate not less than  $175,000.  per annum,
payable either  biweekly or in equal  semimonthly  installments on the fifteenth
and last day of the month,  provided  that if at any time while the Executive is
employed hereunder he should receive an increase in the annual base salary being
paid him by the Company, the above specified minimum salary rate shall thereupon
increase by a  corresponding  amount.  The Executive  shall also be eligible for
participation in any employee benefit plans and compensation  programs available
to salaried  employees or employees  generally of the Company or any  Subsidiary
that employs the Executive.

4.  Noncompetition:  The  Executive  agrees  that  at any  time  while  employed
hereunder  he will not  engage in any  activity  competitive  with any  business
carried on by the Company or its Subsidiaries and Affiliates,  without obtaining
the specific prior written consent of the Company.  He,  however,  shall be free
without the consent of the Company to purchase stocks or other securities of any
corporation listed on a national  securities exchange or included in a published
"over the counters" list.

5. Compensation  During Illness: If while employed hereunder the Executive shall
become  unable  to  perform  his  duties  hereunder  due  to  illness  or  other
incapacity, compensation during such period shall be provided in accordance with
the sick leave  policy for  salaried  employees  or  employees  generally of the
Company or any Subsidiary that employs the Executive, or if applicable, under an
income protection  insurance plan for salaried employees and employees generally
of the Company or any  Subsidiary  that  employs the  Executive.  Subject to the
other terms of this Agreement,  no other  compensation  shall be provided during
the period of such illness or incapacity.

6. Death: In the event of the Executive's  death while employed  hereunder,  his
spouse,  or personal  representative  if such spouse  shall have died,  shall be
entitled  to receive  his salary at the rate then in effect  through the date of
his death plus one  additional  pay period as provided  under the  Company's pay
policy, as well as any amounts previously earned and not paid for the periods of
service prior to his date of death.

7. Successors:  Nothing in this Agreement shall prevent the consolidation of the
Company  with,  or its merger  into,  any other  corporation  or the sale by the
Company  of  all  or  substantially  all of its  properties  or  assets,  or the
assignment by the Company of this Agreement in connection  with any of the above
mentioned actions; provided that the Company will require any successor (whether
direct  or  indirect,   by  merger,   consolidation  or  otherwise)  to  all  or
substantially  all of the  properties or assets of the Company,  by agreement in
form and substance satisfactory to the Executive,  to expressly assume and agree
to perform  this  Agreement  in the same  manner and to the same extent that the
Company would be required to perform it if no such  succession  has taken place.
This Agreement shall not be assignable by the Executive or by the Company or its
successors except as provided herein.

8. Retirement: Notwithstanding the Executive's agreement herein to serve for the
term of his employment  under this  Agreement,  the Executive may retire under a
retirement  plan available to salaried  employees or employees  generally of the
Company or any  Subsidiary  that employs the  Executive  when entitled to do so,
except that he may elect early  retirement  under any such plan only upon giving
the  Company (or a  Subsidiary  employing  the  Executive)  six months'  written
notice;  and  upon  his  retirement  his  term  of  employment  hereunder  shall
terminate. Notwithstanding the foregoing, following a Change of Control, (i) the
Executive  may elect early  retirement  under a  retirement  plan  available  to
salaried employees or employees  generally of the Company or any Subsidiary that
employs the  Executive  upon giving the Company (or a Subsidiary  employing  the
Executive) two days' written notice and (ii) any retirement under such plan that
is  coincident  with  or  subsequent  to  an  involuntary   termination  of  the
Executive's  employment for any reason other than Cause,  death or Disability or
the Executive's  termination of his employment  hereunder for Good Reason,  will
not preclude payments under this Agreement to which the Executive is entitled in
respect of such termination.

9. Compensation Upon Termination  Following a Change of Control:  In addition to
the rights and benefits accruing to the Executive as otherwise described in this
Agreement,  in the event that (a) a Change of Control shall have occurred  while
the Executive is employed hereunder and (b) the Executive's employment hereunder
shall be  involuntarily  terminated  for any reason  other than Cause,  death or
Disability or the Executive  shall  terminate his employment  hereunder for Good
Reason,  then the Company shall make a lump sum payment in cash to the Executive
as severance  pay on the fifth day following  the Date of  Termination  equal to
three times the Executive's annual base salary (including for these purposes any
amounts  previously  deferred  under  any  qualified  or  nonqualified  deferred
compensation  plan,  program or arrangement) in effect  immediately prior to the
date that either a Change of Control shall occur or such termination,  whichever
salary is higher; provided,  however, that if all or any portion of the payments
or benefits  provided  under this Section 9, either alone or together with other
payments  and  benefits  which the  Executive  receives  or is then  entitled to
receive  from the  Company or any  Subsidiary,  would  constitute  a  "parachute
payment"  within the meaning of Section 280G of the Code,  then the payments and
benefits  provided to the  Executive  under this  Section 9 shall be reduced but
only to the extent  necessary  that no portion  thereof  shall be subject to the
excise tax imposed by Section  4999 of the Code;  but only if, by reason of such
reduction,  the Executive's Net After Tax Benefit shall exceed the Net After Tax
Benefit if such  reduction were not made.  The foregoing  calculations  (and any
calculations  required  under the  definition of Net After Tax Benefit) shal1 be
made,  at the  Company's  expense,  by the  Company  and  the  Executive.  If no
agreement  on the  calculations  is  reached  within  five  days of the  Date of
Termination then the Executive and the Company will agree to the selection of an
accounting  firm  to make  the  calculations.  If no  agreement  can be  reached
regarding the selection of an accounting  firm,  the Company shall select a "big
six" accounting firm which has no current or recent business  relationship  with
the Company or with the Executive.  The  determination of any such firm selected
will be conclusive and binding on all parties.

10. Acceleration and Vesting of Stock Plans. Stock Options and SAR'S Following a
Change of Control:  In the event a Change of Control of the  Company  shall have
occurred while the Executive is employed  hereunder,  then,  notwithstanding the
terms and conditions of any benefit plan or compensation  program of the Company
or any  Subsidiary  that employs the Executive  including but not limited to any
purchase plan,  stock grant plan,  stock option plan,  employee stock  ownership
plan or similar plan or program  (excluding  any plan  qualified  under  Section
401(a) of the Code),  the  Company  agrees  (i) to  accelerate,  vest,  and make
immediately  exercisable  in full (to the extent not already  provided for under
the terms of such applicable plans or programs) all  unexercisable  installments
of all options to acquire  securities of the Company and any accompanying  stock
appreciation  rights,  which are Beneficially Owned by the Executive on the date
of such  Change  of  Control,  and (ii) to waive  any  applicable  restrictions,
including resale restrictions or rights of repurchase, relating to or imposed on
securities  granted by the  Company to the  Executive  pursuant to such plans or
programs which securities are Beneficially  Owned by the Executive on such date.
11. Benefits  Restoration Plan Following  Change of Control:  To the extent that
the Executive is or becomes a participant in the Benefits  Restoration Plan, the
Company  shall  amend or have  amended  the  Benefits  Restoration  Plan,  which
amendment  shall  thereafter  remain in effect,  to provide  that in the event a
Change of Control shall have occurred while the Executive is employed  hereunder
and the Executive's  employment hereunder shall be involuntarily  terminated for
any  reason  other  than  Cause,  death or  Disability  or the  Executive  shall
terminate his employment  hereunder for Good Reason, then the Executive shall be
entitled to a nonforfeitable right to all benefits credited to such Executive to
such additional years of credit for purposes of calculating the years of service
and age of such Executive under the terms of the Benefits Restoration Plan equal
to the lesser of (i) five years or (ii) the number of years  necessary  to bring
the Executive to age 65 under the terms of the Benefits Restoration Plan.

12.  Mitigation:  If at any time the Executive's  employment  hereunder shall be
terminated for any reason,  then all payments and benefit to which the Executive
is entitled  under this  Agreement  shall be made and provided  without  offset,
deduction or mitigation on account of income the Executive  could or may receive
from other employment or otherwise;  provided, however, that if the Executive is
involuntarily  terminated for any reason other than Reason,  prior to the Change
of Control,  then,  until the term of this  Agreement  ends,  the amount payable
under this Agreement shall be reduced by any compensation  actually  received by
the Executive  from  comparable  employment  (as to position,  compensation  and
responsibility)  with any person or entity that is engaged in a business that is
competitive with the Company or its Subsidiaries and Affiliates.

13.  Legal  Expenses:  The Company  shall pay (at least  monthly)  all costs and
expenses,  including  reasonable  attorneys' fees and  disbursements,  which the
Executive may incur in connection  with any  litigation,  arbitration or similar
proceeding,  whether instituted by the Company or the Executive, with respect to
the interpretation or enforcement of any provision under this Agreement.

14.  Accommodations  and Travel  Expenses:  The  Company  agrees  that while the
Executive  is  employed  hereunder  he  shall  be  furnished  office  space  and
accommodations  suitable to the  character  of his position and adequate for the
performance  of his duties.  Reasonable  traveling  expenses  incurred by him in
traveling on business of the Company and its Subsidiaries  will be reimbursed in
accordance with the established  traveling  expense policy of the Company or any
Subsidiary that employs the Executive.

15.  Notices:  Any notices  required under the terms of this Agreement  shall be
effective when mailed, postage prepaid, by certified mail, addressed:

If to Kerr-McGee:                Frank A. McPherson
                                 Chairman of the Board and
                                 Chief Executive Officer
                                 Kerr-McGee Corporation
                                 Kerr-McGee Center
                                 Oklahoma City, Oklahoma 73102

If to the Executive:             Russell G. Homer, Jr.
                                 3224 Rock Hollow Road
                                 Oklahoma City, Oklahoma 73120

16. Entire Agreement:  This Agreement comprises the entire agreement between the
Company and its  Subsidiaries  and the Executive and shall supersede any and all
previous  contracts,  agreements or  understandings  between the Company and its
Subsidiaries  and the Executive with respect to the subject matter hereof.  This
Agreement may not be modified except by written  agreement  between the parties.
Subject to Section 1 hereof,  any inconsistency  between Sections 9, 10, 11, 12,
13,  16,  17,  18 and 19 of this  Agreement  and any  other  provisions  of this
Agreement shall be resolved in favor of such Sections.

17. Arbitration:  Any dispute or controversy arising under or in connection with
this  Agreement  shall be settled  exclusively  by arbitration in Oklahoma City,
Oklahoma, or, at the option of the Executive,  in the county where the Executive
resides,  in accordance with the Rules of the American  Arbitration  Association
then in effect;  provided,  however,  that if the Executive institutes an action
relating to this Agreement the Executive  may, at his option,  bring such action
in an Oklahoma court of competent  jurisdiction.  Judgment may be entered on the
arbitrator's award in any such court having jurisdiction.

18.  Separability:  Any  provision  of  this  Agreement  which  is  held  to  be
unenforceable or invalid in any respect in any jurisdiction shall be ineffective
in such  jurisdiction to the extent that it is  unenforceable or invalid without
affecting the remaining  provisions  hereof,  which shall continue in full force
and effect. The enforceability or invalidity of a provision of this Agreement in
one jurisdiction shall not invalidate or render  unenforceable such provision in
any other jurisdiction.

19. Section and Other Headings: The section and other headings contained in this
Agreement  are for  reference  purposes only and shall not affect the meaning or
interpretation of this Agreement.

IN WITNESS  WHEREOF,  the Company and the Executive have executed this Agreement
on the 31st day of March, 1993.


                                               KERR-McGEE CORPORATION



                                               By     (F. A. McPherson)
                                                      F. A. McPherson
(Russell G. Horner, Jr.)                              Chairman of the Board and
Russell G. Horner, Jr.                                Chief Executive Officer





                                                                     Schedule A

                               Certain Definitions


As used in this Agreement,  and unless the context requires a different meaning,
the following terms have the meanings indicated:

"Affiliate"  has the meaning  set forth in Rule 12b-2 of the  General  Rules and
Regulations promulgated under the Securities Exchange Act of 1934, as amended.

"Beneficial  Owner" has the  meaning  set forth in Rules  13d-3 and 13d-5 of the
General Rules and Regulations  promulgated under the Securities  Exchange Act of
1934, as amended.

"Benefits  Restoration  Plan" means the  Company's  Benefits  Restoration  Plan,
effective September 12, 1989, as amended.

"Cause" means willful and gross misconduct on the part of the Executive that has
a  materially  adverse  effect on the Company and its  Subsidiaries,  taken as a
whole,  or the  conviction  of the  Executive of a felony  under  United  States
federal,  state or local  criminal law, as determined in good faith by a written
resolution duly adopted by the  affirmative  vote of not less than 2/3 of all of
the directors who are not employees,  officers,  or otherwise  Affiliates of the
Company.

"Change of Control" means any one of the following: (a) a change in any two year
period in a majority  of the  members of the Board of  Directors  of the Company
resulting from the election of directors who were not directors at the beginning
of such period (other than the election of directors to fill  vacancies  created
by death or Disability,  or the election of a director to replace a director who
by virtue of his age is not  eligible  for  election  under the  By-laws  of the
Company  as in effect on the date of this  Agreement);  (b) any Person or Group,
together  with  its  Affiliates,  becomes  the  Beneficial  Owner,  directly  or
indirectly, of 25% or more of the Company's then outstanding Common Stock or 25%
or more  of the  voting  power  of the  Company's  then  outstanding  securities
entitled to vote generally for the election of the Company's directors;  (c) the
approval by the Company's stockholders of (i) the merger or consolidation of the
Company with any other corporation  (other than a merger or consolidation of the
Company and a  wholly-owned  subsidiary  in which the  holders of the  Company's
Common Stock  immediately  prior to such merger or  consolidation  have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger or  consolidation),  (ii) the sale,  lease,  exchange  or other
transfer  (in one  transaction  or a series of related  transactions)  of all or
substantially  all,  of the assets of the  Company or (iii) the  liquidation  or
dissolution  of the  Company;  or (d) a majority  of the members of the Board of
Directors in office immediately prior to a proposed  transaction,  if determined
by written resolution that such proposed transaction, if taken, will be deemed a
Change of Control and such proposed transaction is effected.

"Code" means the Internal Revenue Code of 1986, as amended.

"Date of  Termination"  means (i) if the  Executive's  employment  is terminated
under this Agreement due to Disability,  thirty days after Notice of Termination
is given to the Executive (provided the Executive shall not have returned to the
performance  of  the  Executive's  duties  on  a  full-time  basis  during  such
thirty-day  period)  or  (ii) if the  Executive's  employment  is  involuntarily
terminated under this Agreement for any other reason, the date on which a Notice
of Termination is given; provided, however, that if within thirty days after any
Notice of  Termination  is given to the  Executive,  the Executive  notifies the
Company or the  Subsidiary  that  employs the  Executive  that a dispute  exists
concerning  the  termination,  the  Date of  Termination  shall  be the date the
dispute is finally  determined,  whether by mutual  agreement  by the parties or
upon final judgment,  order or decree of a court of competent  jurisdiction (the
time for appeal therefrom having expired and no appeal having been perfected).

"Disability"  means that (i) a person has been totally  incapacitated  by bodily
injury or physical or mental disease so as to be prevented thereby from engaging
in a comparable  occupation or employment for remuneration or profit,  (ii) such
person  will be  subject  to such  total  incapacity  for a  period  of at least
eighteen  consecutive  months and (iii) such person is disabled  for purposes of
any and all of the plans or  programs  of the  Company  or any  Subsidiary  that
employs  the  Executive  under  which  benefits,   compensation  or  awards  are
contingent  upon a finding of  disability.  The  determination  with  respect to
whether the  Executive is suffering  from a Disability  will be  determined by a
mutually  acceptable  physician or, if there is no physician mutually acceptable
to the Company  and the  Executive,  by a physician  selected by the Dean of the
University of Oklahoma Medical School.

"Good Reason" means (a) without the Executive's express written consent, (i) (A)
the  assignment  to the  Executive  of any  duties,  or  any  limitation  of the
Executive's  responsibilities,  inconsistent  with  the  Executive's  positions,
duties,  responsibilities  and status  with the Company or any  Subsidiary  that
employs the Executive immediately prior to the date of the Change of Control, or
(B) any removal of the Executive  from, or any failure to re-elect the Executive
to, any of the  Executive's  positions with the Company or any  Subsidiary  that
employs the  Executive  immediately  prior to the Change of  Control,  except in
connection  with  the  involuntary  termination  of the  Executive's  employment
hereunder for Cause or as a result of the Executive's death or Disability or the
termination of the Executive's  employment on the Executive's  normal retirement
date; (b) any failure by the Company to pay, or any reduction by the Company of,
the Executive's base annual salary or bonus  compensation in effect  immediately
prior to the Change of Control; (c) any failure by the Company or any Subsidiary
that employs the  Executive to (i)  continue to provide the  Executive  with the
opportunity  to  participate,  on terms no less  favorable  than those in effect
immediately  prior  to  the  Change  of  Control,   in  any  benefit  plans  and
compensation programs in which the Executive was participating immediately prior
to the Change of  Control,  or their  equivalent,  including  but not limited to
participation in pension,  profit sharing, stock grants, stock option,  savings,
employee stock  ownership,  incentive  compensation,  group  insurance  plans or
similar  plans or programs or (ii) provide the  Executive  with all other fringe
benefits (or their  equivalent),  including paid vacation,  from time to time in
effect for the benefit of any  executive,  management  or  administrative  group
which  customarily  includes a person holding the  employment  position with the
Company  or its  Subsidiaries  then  held  by the  Executive;  (d)  without  the
Executive's   express   written   consent,   the  relocation  of  the  Company's
headquarters  or of the  principal  place  of the  Executive's  employment  to a
location  that is more  than 35 miles  further  from the  Executive's  principal
residence  than such  principal  place of  employment  immediately  prior to the
Change  of  Control;  (e) any  change  in the sick  leave  policy  for  salaried
employees or employees  generally of the Company or any Subsidiary  that employs
the Executive which has an adverse effect on the Executive's rights and benefits
pursuant to such  policy;  (f) any  reduction  in the  benefits  provided to the
Executive  pursuant to Section 14 of this  Agreement;  (g) any  reduction to the
extent applicable in benefits offered under an income protection  insurance plan
for salaried  employees or employees  generally of the Company or any Subsidiary
that  employs  the  Executive;  (h) any change in the pay  policy  for  salaried
employees or employees  generally of the Company or any Subsidiary  that employs
the Executive which has an adverse effect on the Executive's rights and benefits
pursuant to such  policy;  (i) with  respect to a  Subsidiary  that  employs the
Executive,  the sale by the Company of 25% or more of such  Subsidiary's  common
stock or 25% or more of the Subsidiary's then outstanding securities entitled to
vote generally for the election of the  Subsidiary's  directors,  or the sale by
the Company of all or substantially  all of the assets of such  Subsidiary;  (j)
the breach of any provision of this  Agreement by the Company or (k) the failure
of any successor company to the Company to expressly assume this Agreement.

"Group"  has the  meaning  set  forth in Rule  13d-5 of the  General  Rules  and
Regulations promulgated under the Securities Exchange Act of 1934, as amended.

"Net After Tax Benefit"  means the sum of (i) the total  amounts  payable to the
Executive  under Section 9 of this  Agreement,  plus (ii) all other payments and
benefits  which the  Executive  receives or is then entitled to receive from the
Company or any Subsidiary that would constitute a "parachute payment" within the
meaning of  Section  280G of the Code,  less (iii) the amount of federal  income
taxes payable with respect to the foregoing  calculated at the maximum  marginal
income  tax rate  for each  year in  which  the  foregoing  shall be paid to the
Executive  (based upon the rate in effect for such year as set forth in the Code
at the time of  termination of his  employment),  less (iv) the amount of excise
taxes  imposed with  respect to the  payments and benefits  described in (i) and
(ii) above by Section 4999 of the Code.

"Notice of  Termination"  means a written  notice  which  shall  indicate  those
specific  provisions  in this  Agreement  relied  upon and which  sets  forth in
reasonable  detail  the facts and  circumstances  claimed to provide a basis for
termination of the Executive's employment under the provision so indicated.

"Person" means any individual, firm, corporation, group (as such term is used in
Rule 13d of the General Rules and Regulations  promulgated  under the Securities
Exchange Act of 1934, as amended) or other entity.

"Reason" means (a) action by the Executive  involving willful  malfeasance,  (b)
failure to act by the Executive involving material nonfeasance having a material
adverse effect on the Company or the Subsidiary that employs the Executive,  (c)
the Executive being convicted of a felony under United States federal, state, or
local  criminal  law,  or (d)  the  material  breach  of any  provision  of this
Agreement by the Executive.

"Subsidiary" with respect to the Company has the meaning set forth in Rule 12b-2
of the General Rules and Regulations  promulgated under the Securities  Exchange
Act of 1934, as amended.




                                                                     Annexure 1

                         Operative Provisions beginning
                          the Annexure 1 Effective Date


1.       OPERATION OF AGREEMENT

The operative  provisions of this Agreement shall become  effective  February 1,
1996, or immediately upon a Change of Control occurring after December 31, 1992,
whichever occurs earlier, provided that the Executive is employed by the Company
immediately  prior  to such  Change  of  Control.  Once  the  provisions  become
effective, this Agreement shall not terminate until the third anniversary of the
Change of  Control.  Notwithstanding  the  termination  of this  Agreement,  the
Company  shall remain  liable for any rights or payments  arising  prior to such
termination to which the Executive is entitled under this Agreement.

2.       SERVICE AFTER CHANGE OF CONTROL

Following a Change of Control,  the Company will not terminate  the  Executive's
employment  with the  Company  except  on  account  of Cause  prior to the third
anniversary of the Change of Control.  Upon any termination of employment of the
Executive,  other than for Cause or upon death, a Notice of Termination shall be
provided by the party causing such termination of employment.

3.       BENEFITS UPON CHANGE OF CONTROL

(a) Stock Plans. Notwithstanding the terms and conditions of any benefit plan or
compensation program of the Company or any Subsidiary that employs the Executive
including but not limited to any purchase plan,  stock grant plan,  stock option
plan,  employee stock  ownership plan or similar plan or program  (excluding any
plan qualified  under Section 401(a) of the Code),  the Company shall,  upon the
occurrence  of the Change of  Control  which  causes  this  Agreement  to become
effective (i) accelerate,  vest and make immediately exercisable in full (to the
extent not  already  provided  for under the terms of such  applicable  plans or
programs) all unexercisable installments of all options to acquire securities of
the  Company  and any  accompanying  stock  appreciation  rights,  of which  the
Executive is the Beneficial Owner on the date of such Change of Control and (ii)
waive any applicable  restrictions  including  resale  restrictions or rights of
repurchase,  relating to or imposed on securities  granted by the Company to the
Executive  pursuant to such plans or programs which  securities the Executive is
the Beneficial Owner of on the date of such Change of Control.

(b) Pension Plan.  Following a Change of Control,  the Executive may elect early
retirement under a retirement plan available to salaried  employees or employees
generally  of the Company or any  Subsidiary  that  employs the  Executive  upon
giving the Company (or a Subsidiary  employing the  Executive) two days' written
notice.

(c) Benefits  Restoration Plan. To the extent that the Executive is or becomes a
participant  in the Benefits  Restoration  Plan, the Company shall amend or have
amended the Benefits  Restoration  Plan, which amendment shall thereafter remain
in  effect,  to  provide  in the  event of an  Executive's  Termination  for the
benefits specified in Section 4(b) hereof.

(d)  Death of an  Executive.  In the  event of the  Executive's  death  prior to
Termination,  but while employed by the Company or any  Subsidiary,  as the case
may be, his spouse or personal  representative,  if such spouse shall have died,
shall be entitled  to receive his salary at the rate then in effect  through the
date of his  death,  plus one  additional  pay  period,  as  provided  under the
Company's pay policy, as well as any amounts  previously earned and not paid for
the periods of service prior to his date of death.

4.       PAYMENTS AND BENEFITS UPON TERMINATION

The Executive shall be entitled to the following payments and benefits following
Termination:

(a) Termination  Payment.  In recognition of past services to the Company by the
Executive and in  consideration  for the undertaking by the Executive to provide
services to the Company,  pursuant to Section 2 hereof, the Company shall make a
lump sum  payment in cash to the  Executive  as  severance  pay on the fifth day
following the Date of Termination  equal to three times the  Executive's  annual
base salary (including for these purposes any amounts previously  deferred under
any  qualified  or  nonqualified   deferred   compensation   plan,   program  or
arrangement)  in effect  immediately  prior to the date that  either a Change of
Control shall occur or such Date of Termination, whichever salary is higher.

Notwithstanding the foregoing, if all or any portion of the payments or benefits
provided  under this Section 4(a),  either alone or together with other payments
and benefits  which the  Executive  receives or is then entitled to receive from
the Company or any Subsidiary,  would constitute a Parachute  Payment,  then the
payments and benefits provided to the Executive under this Section 4(a) shall be
reduced but only to the extent necessary to ensure that no portion thereof shall
be subject to the excise tax imposed by Section  4999 of the Code;  but only if,
by reason of such reduction,  the Executive's Net After Tax Benefit shall exceed
the Net  After Tax  Benefit  if such  reduction  were not  made.  The  foregoing
calculations  (and any  calculations  required under the definition of Net After
Tax Benefit)  shall be made,  at the Company's  expense,  by the Company and the
Executive.  If no agreement on the  calculations  is reached within five days of
the Date of  Termination,  then the  Executive and the Company will agree to the
selection of an accounting firm to make the calculations. If no agreement can be
reached  regarding the selection of an accounting firm, the Company shall select
a "big six" accounting firm which has no current or recent business relationship
with the  Company  or with the  Person or Group  responsible  for the  Change of
Control.  The  determination  of any such firm selected  will be conclusive  and
binding on all parties.

(b) Benefits  Restoration  Plan.  The Executive  shall be entitled to additional
years of credit for purposes of calculating the years of service and age of such
Executive under the terms of the Benefits  Restoration  Plan equal to the lesser
of (i) five years or (ii) the number of years  necessary to bring the  Executive
to age 65 under the terms of the Benefits  Restoration  Plan,  and the Executive
shall  have a  nonforfeitable  right to any and all  benefits  credited  to such
Executive under the Benefits Restoration Plan.

(c) Death of the Executive.  In the event of the Executive's death subsequent to
Termination,  all payments and benefits required by this Agreement shall be paid
to the Executive's  designated  beneficiary or  beneficiaries  or, if he has not
designated a beneficiary or beneficiaries, to his estate.

5.       CONFIDENTIALITY

The Executive agrees to hold in confidence any and all confidential  information
known to him concerning the Company and its  Subsidiaries  and their  respective
businesses so long as such information is not otherwise publicly disclosed.

6.       ARBITRATION

Any dispute or  controversy  arising under or in connection  with this Agreement
shall be settled exclusively by arbitration in Oklahoma City,  Oklahoma,  or, at
the option of the  Executive,  in the county  where the  Executive  resides,  in
accordance  with  the  Rules of the  American  Arbitration  Association  then in
effect;  provided,  however, that if the Executive institutes an action relating
to this  Agreement  the  Executive  may, at his option,  bring such action in an
Oklahoma  court  of  competent  jurisdiction.  Judgment  may be  entered  on the
arbitrator's award in any such court having jurisdiction.

7.       CONFLICT IN BENEFITS

This  Agreement  is not  intended to and shall not  adversely  affect,  limit or
terminate  any other  agreement or  arrangement  between the  Executive  and the
Company  presently in effect or hereafter  entered into'  including any employee
benefit plan under which the Executive is entitled to benefits.


8.       MISCELLANEOUS

(a) No Mitigation.  All payments and benefits to which the Executive is entitled
under this Agreement  shall be made and provided  without  offset,  deduction or
mitigation  on account of income the  Executive  could or may receive from other
employment or otherwise.

(b) Legal  Expenses.  The Company  shall pay all costs and  expenses,  including
reasonable  attorneys'  fees  and  disbursements,  of the  Executive,  at  least
monthly,  in connection with any litigation,  arbitration or similar proceeding,
whether or not instituted by the Company or the  Executive,  with respect to the
interpretation or enforcement of any provision of this Agreement.

(c) Notices.  Any notices  required under the terms of this  Agreement  shall be
effective when mailed,  postage prepaid,  by certified mail and addressed to, in
the case of the Company:

               Frank A. McPherson
               Chairman of the Board and
               Chief Executive Officer
               Kerr-McGee Corporation
               Kerr-McGee Center
               Oklahoma City, Oklahoma 73102

and to, in the case of the Executive:

               Russell G. Homer, Jr.
               3224 Rock Hollow Road
               Oklahoma City, Oklahoma 73120

Either  party may  designate a  different  address by giving  written  notice of
change of address in the manner provided above.

(d) Waiver. No waiver or modification in whole or in part of this Agreement,  or
any term or condition  hereof,  shall be  effective  against any party unless in
writing  and duly  signed by the party  sought  to be bound.  Any  waiver of any
breach  of any  provision  hereof  or any  right or  power  by any  party on one
occasion  shall not be  construed  as a waiver of, or a bar to, the  exercise of
such  right or power on any  other  occasion  or as a waiver  of any  subsequent
breach.

(e) Binding Effect; Successors. Subject to the provisions hereof, nothing in the
Agreement  shall  prevent the  consolidation  of the Company with, or its merger
into, any other  corporation or the sale by the Company of all or  substantially
all of its  properties  and assets,  or the  assignment of this Agreement by the
Company in connection with any of the foregoing actions. This Agreement shall be
binding upon,  inure to the benefit of and be enforceable by the Company and the
Executive and their  respective  heirs,  legal  representatives,  successors and
assigns.  If the  Company  shall be merged  into or  consolidated  with  another
entity,  the provisions of this Agreement shall be binding upon and inure to the
benefit  of  the  entity   surviving   such  merger  or   resulting   from  such
consolidation.  The  Company  will  require  any  successor  (whether  direct or
indirect,   by  purchase,   merger,   consolidation  or  otherwise)  to  all  or
substantially all of the business or assets of the Company, by agreement in form
and substance  satisfactory to the Executive,  to expressly  assume and agree to
perform  this  Agreement  in the same  manner  and to the same  extent  that the
Company would be required to perform it if no such  succession  had taken place.
The provisions of this Section 8(e) shall  continue to apply to each  subsequent
employer  of the  Executive  hereunder  in the event of any  subsequent  merger,
consolidation or transfer of assets of such subsequent employer.

(f)  Separability.  Any  provision  of  this  Agreement  which  is  held  to  be
unenforceable or invalid in any respect in any jurisdiction shall be ineffective
in such  jurisdiction to the extent that it is  unenforceable or invalid without
affecting the remaining  provisions  hereof,  which shall continue in full force
and effect. The enforceability or invalidity of a provision of this Agreement in
one jurisdiction shall not invalidate or render  unenforceable such provision in
any other jurisdiction.

(g)  Controlling  Law.  This  Agreement  shall be governed by and  construed  in
accordance  with the laws of the State of Oklahoma  applicable to contracts made
and to be performed therein.

(h) Section and Other Headings. The section and other headings contained in this
Agreement  are for  reference  purposes only and shall not affect the meaning or
interpretation of this Agreement.

(i) Entire Agreement.  This Agreement  comprise the entire agreement between the
Company and its  Subsidiaries  and the Executive and shall supersede any and all
previous  contracts,  agreements or  understandings  between the Company and its
Subsidiaries and the Executive with respect to the subject matter hereof.



                                                                   Schedule I-A
                                                                  to Annexure 1

                               CERTAIN DEFINITIONS


As used in this Agreement,  and unless the context requires a different meaning,
the following terms have the meanings indicated:

"Affiliate"  has the meaning  set forth in Rule 12b-2 of the  General  Rules and
Regulations promulgated under the Securities Exchange Act of 1934, as amended.

"Beneficial  Owner" has the  meaning  set forth in Rules  13d-3 and 13d-5 of the
General Rules and Regulations  promulgated under the Securities  Exchange Act of
1934, as amended.

"Benefits  Restoration Plan" means the Company's  Benefits  Restoration Plan, As
Amended and Restated Effective September 12, 1989, as amended.

"Cause" means willful and gross misconduct on the part of the Executive that has
a  materially  adverse  effect on the Company and its  Subsidiaries,  taken as a
whole,  or the  conviction  of the  Executive of a felony  under  United  States
federal,  state or local  criminal law, as determined in good faith by a written
resolution duly adopted by the  affirmative  vote of not less than two-thirds of
all of the directors who are not employees, officers, or otherwise Affiliates of
the Company.

"Change of Control" means any one of the following: (a) a change in any two year
period in a majority  of the  members of the Board of  Directors  of the Company
resulting from the election of directors who were not directors at the beginning
of such period (other than the election of directors to fill  vacancies  created
by death or Disability,  or the election of a director to replace a director who
by virtue of his age is not  eligible  for  election  under the  by-laws  of the
Company  as in effect on the date of this  Agreement);  (b) any Person or Group,
together  with  its  Affiliates,   become  the  Beneficial  Owner,  directly  or
indirectly, of 25% or more of the Company's then outstanding Common Stock or 25%
or more  of the  voting  power  of the  Company's  then  outstanding  securities
entitled to vote generally for the election of the Company's directors;  (c) the
approval by the Company's stockholders of (i) the merger or consolidation of the
Company with any other corporation  (other than a merger or consolidation of the
Company and a  wholly-owned  Subsidiary  in which the  holders of the  Company's
Common Stock  immediately  prior to such merger or  consolidation  have the same
proportionate ownership of common stock of the surviving corporation immediately
after the merger or  consolidation),  (ii) the sale,  lease,  exchange  or other
transfer  (in one  transaction  or a series of related  transactions)  of all or
substantially  all,  of the  assets of the  Company;  or (d) a  majority  of the
members  of the Board of  Directors  in office  immediately  prior to a proposed
transaction determined by written resolution that such proposed transaction,  if
taken,  will be deemed a Change of  Control  and such  proposed  transaction  is
affected.

"Code" means the Internal Revenue Code of 1986, as amended.

"Date of Termination"  means if the Executive's  employment is terminated during
the term of this Agreement,  the date on which a Notice of Termination is given;
provided, however, that if within thirty days after any Notice of Termination is
given to the  Executive,  the Executive  notifies the Company or the  Subsidiary
that employs the Executive that a dispute exists concerning the termination, the
Date of Termination shall be the date the dispute is finally determined, whether
by mutual agreement by the parties or upon final judgment,  order or decree of a
court of competent  jurisdiction  (the time for appeal  therefrom having expired
and no appeal having been perfected).

"Disability"  means that (i) a person has been totally  incapacitated  by bodily
injury or physical or mental disease so as to be prevented thereby from engaging
in a comparable  occupation or employment for remuneration or profit,  (ii) such
person  will be  subject  to such  total  incapacity  for a  period  of at least
eighteen  consecutive  months and (iii) such person is disabled  for purposes of
any and all of the plans or  programs  of the  Company  or any  Subsidiary  that
employs  the  Executive  under  which  benefits,   compensation  or  awards  are
contingent  upon a finding of  disability.  The  determination  with  respect to
whether the  Executive is suffering  from a Disability  will be  determined by a
mutually  acceptable  physician or, if there is no physician mutually acceptable
to the Company  and the  Executive,  by a physician  selected by the Dean of the
University of Oklahoma Medical School.

"Good Reason" means (a) without the Executive's express written consent, (i) the
assignment to the Executive of any duties,  or any limitation of the Executive's
responsibilities,   inconsistent   with  the  Executive's   positions,   duties,
responsibilities  and status with the Company or any Subsidiary that employs the
Executive  immediately  prior to the date of the Change of Control,  or (ii) any
removal of the Executive  from, or any failure to re-elect the Executive to, any
of the Executive's positions with the Company or any Subsidiary that employs the
Executive immediately prior to the Change of Control,  except in connection with
the  involuntary  termination of the  Executive's  employment by the Company for
Cause or as a result of the Executive's death or Disability;  (b) any failure by
the Company to pay, or any  reduction  by the Company of, the  Executive's  base
annual salary or bonus compensation in effect immediately prior to the Change of
Control;  (c) any  failure by the  Company or any  Subsidiary  that  employs the
Executive  to (i)  continue to provide the  Executive  with the  opportunity  to
participate,  on terms no less favorable than those in effect  immediately prior
to the Change of Control,  in any  benefit  plans and  compensation  programs in
which the Executive was participating immediately prior to the Change of Control
or their equivalent,  including,  but not limited to,  participation in pension,
profit-sharing,  stock grants, stock option, savings,  employee stock ownership,
incentive  compensation,  group insurance plans or similar plans or programs, or
(ii) provide the Executive with all other fringes benefits (or their equivalent)
including  paid  vacation,  from time to time in effect  for the  benefit of any
executive,  management  or  administrative  group which  customarily  includes a
person holding the employment position with the Company or its Subsidiaries then
held by the Executive;  (d) without the Executive's express written consent, the
relocation  of the  Company's  headquarters  or of the  principal  place  of the
Executive's employment to a location that is more than 35 miles further from the
Executive's   principal  residence  than  such  principal  place  of  employment
immediately  prior to the  Change of  Control;  (e) any change in the sick leave
policy for  salaried  employees  or  employees  generally  of the Company or any
Subsidiary  that  employs  the  Executive  which  has an  adverse  effect on the
Executive's  rights and benefits  pursuant to such policy;  (f) any reduction to
the extent applicable in benefits offered under an income  protection  insurance
plan for  salaried  employees  or  employees  generally  of the  Company  or any
Subsidiary  that  employs  the  Executive;  (g) any change in the pay policy for
salaried employees or employees  generally of the Company or any Subsidiary that
employs the Executive which has an adverse effect on the Executive's  rights and
benefits pursuant to such policy;  (h) with respect to a Subsidiary that employs
the  Executive,  the  sale by the  Company  of 25% or more of such  Subsidiary's
common  stock or 25% or more of the  Subsidiary's  then  outstanding  securities
entitled to vote generally for the election of the  Subsidiary's  directors,  or
the  sale by the  Company  of all or  substantially  all of the  assets  of such
Subsidiary;  (i) the breach of any provision of this Agreement by the Company or
(j) the failure of any successor company to the Company to expressly assume this
Agreement.

"Group"  has the  meaning  set  forth in Rule  13d-5 of the  General  Rules  and
Regulations promulgated under the Securities Exchange Act of 1934, as amended.

"Net After Tax Benefit"  means the sum of (i) the total  amounts  payable to the
Executive under Section 4(a) of this Agreement, plus (ii) all other payments and
benefits  which the  Executive  receives or is then entitled to receive from the
Company or any Subsidiary that would constitute a Parachute Payment,  less (iii)
the  amount of federal  income  taxes  payable  with  respect  to the  foregoing
calculated  at the maximum  marginal  income tax rate for each year in which the
foregoing shall be paid to the Executive (based upon the rate in effect for such
year as set  forth in the Code at the time of  termination  of his  employment),
less (iv) the amount of excise  taxes  imposed  with respect to the payments and
benefits described in (i) and (ii) above by Section 4999 of the Code.

"Notice  of  Termination"  means a  written  notice to the  Executive  or to the
Company,  as the case may be, which shall indicate those specific  provisions in
this Agreement  relied upon and which sets forth in reasonable  detail the facts
and  circumstances  claimed  to  provide  a  basis  for the  termination  of the
Executive's  employment  constituting  a  Termination  under  the  provision  so
indicated.

"Parachute Payment" means any payment deemed to constitute a "parachute payment"
as defined in Section 280G of the Internal Revenue Code of 1986, as amended.

"Person" means any individual, firm, corporation, group (as such term is used in
Rule 13d of the General Rules and Regulations  promulgated  under the Securities
Exchange Act of 1934, as amended) or other entity.

"Subsidiary" with respect to the Company has the meaning set forth in Rule 12b-2
of the General Rules and Regulations  promulgated under the Securities  Exchange
Act of 1934, as amended.

"Termination"  means  following  the  occurrence of any Change of Control by the
Company (i) the  involuntary  termination of the employment of the Executive for
any reason other than for Cause, death or Disability, or (ii) the termination of
employment  by the  Executive  for  Good  Reason;  provided,  however,  that any
retirement under a retirement plan available to salaried  employees or employees
generally of the Company or any  Subsidiary  that employs the Executive  that is
coincident with or subsequent to a Termination, will not preclude payments under
this   Agreement  to  which  the  Executive  is  entitled  in  respect  of  such
Termination.