CONFORMED COPY




                                  $325,000,000


                                CREDIT AGREEMENT


                                   dated as of


                                 August 25, 1994


                                      among


                             Kerr-McGee Corporation


                          Kerr-McGee Credit Corporation


                             The Banks Listed Herein


                                       and


                   Morgan Guaranty Trust Company of New York,
                                    as Agent



<PAGE>

                               TABLE OF CONTENTS*

                                                                           Page

                                    ARTICLE I

                                   DEFINITIONS

SECTION 1.01.                Definitions.................................      1
SECTION 1.02.                Accounting Terms and Determinations.........     14
SECTION 1.03.                Types of Borrowings.........................     14


                                   ARTICLE II

                                   THE CREDITS

SECTION 2.01.                Commitments to Lend.........................     15
SECTION 2.02.                Notice of Committed Borrowings..............     15
SECTION 2.03.                Money Market Borrowings.....................     16
SECTION 2.04.                Notice to Banks; Funding of Loans...........     20
SECTION 2.05.                Notes.......................................     21
SECTION 2.06.                Maturity of Loans...........................     22
SECTION 2.07.                Interest Rates..............................     22
SECTION 2.08.                Facility Fees...............................     25
SECTION 2.09.                Optional Termination or Reduction
                               of Commitments............................     26
SECTION 2.10.                Scheduled Termination of Commitments........     26
SECTION 2.11.                Optional Prepayments........................     26
SECTION 2.12.                Change of Control...........................     27
SECTION 2.13.                General Provisions as to Payments...........     27
SECTION 2.14.                Funding Losses..............................     28
SECTION 2.15.                Computation of Interest and Fees............     28
SECTION 2.16.                Regulation D Compensation...................     29
SECTION 2.17.                Maximum Interest Rate.......................     30


                                   ARTICLE III

                                   CONDITIONS

SECTION 3.01.                Effectiveness...............................     30
SECTION 3.02.                Borrowings..................................     31


--------
*The Table of Contents is not a part of this Agreement.


                                       -i-

<PAGE>


                                                                           Page

                                   ARTICLE IV

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

SECTION 4.01.                Corporate Existence and Power...............     32
SECTION 4.02.                Corporate and Governmental
                               Authorization; No Contravention...........     33
SECTION 4.03.                Binding Effect..............................     33
SECTION 4.04.                Financial Information.......................     33
SECTION 4.05.                Litigation..................................     33
SECTION 4.06.                Compliance with ERISA.......................     34
SECTION 4.07.                Environmental Matters.......................     35
SECTION 4.08.                Taxes.......................................     35
SECTION 4.09.                Subsidiaries................................     35


                                    ARTICLE V

                                    COVENANTS

SECTION 5.01.                Information.................................     35
SECTION 5.02.                Payment of Taxes............................     38
SECTION 5.03.                Insurance...................................     38
SECTION 5.04.                Conduct of Business and Maintenance
                               of Existence..............................     39
SECTION 5.05.                Compliance with Laws........................     39
SECTION 5.06.                Compliance with ERISA.......................     39
SECTION 5.07.                Negative Pledge.............................     40
SECTION 5.08.                Consolidations, Mergers and Sales
                               of Assets.................................     42
SECTION 5.09.                Use of Proceeds.............................     42
SECTION 5.10.                Transactions with Affiliates................     42
SECTION 5.11.                Ownership of Credit Corporation.............     42
SECTION 5.12.                Change in Rating............................     43


                                   ARTICLE VI

                                    DEFAULTS

SECTION 6.01.                Events of Default...........................     43
SECTION 6.02.                Notice of Default...........................     46


                                   ARTICLE VII

                                    THE AGENT

SECTION 7.01.                Appointment and Authorization...............     46


                                      -ii-

<PAGE>


                                                                           Page

SECTION 7.02.                Agent and Affiliates........................     46
SECTION 7.03.                Action by Agent.............................     46
SECTION 7.04.                Consultation with Experts...................     46
SECTION 7.05.                Liability of Agent..........................     46
SECTION 7.06.                Indemnification.............................     47
SECTION 7.07.                Credit Decision.............................     47
SECTION 7.08.                Successor Agent.............................     47
SECTION 7.09.                Agent's Fee.................................     48


                                  ARTICLE VIII

                             CHANGE IN CIRCUMSTANCES

SECTION 8.01.                Basis for Determining Interest Rate
                               Inadequate or Unfair......................     48
SECTION 8.02.                Illegality..................................     49
SECTION 8.03.                Increased Cost and Reduced Return...........     50
SECTION 8.04.                Substitute Loans............................     52
SECTION 8.05.                Substitution of Bank........................     52


                                   ARTICLE IX

                                    GUARANTY

SECTION 9.01.                The Guaranty................................     53
SECTION 9.02.                Guaranty Unconditional......................     53
SECTION 9.03.                Discharge Only Upon Payment In
                               Full; Reinstatement In Certain
                               Circumstances.............................     54
SECTION 9.04.                Waiver by the Company.......................     54
SECTION 9.05.                Subrogation.................................     54
SECTION 9.06.                Stay of Acceleration........................     55


                                    ARTICLE X

                                  MISCELLANEOUS

SECTION 10.01.               Notices.....................................     55
SECTION 10.02.               No Waivers..................................     55
SECTION 10.03.               Expenses; Documentary Taxes;
                               Indemnification...........................     56
SECTION 10.04.               Sharing of Set-Offs.........................     57
SECTION 10.05.               Amendments and Waivers......................     57
SECTION 10.06.               Successors and Assigns......................     58
SECTION 10.07.               Collateral..................................     60
SECTION 10.08.               Governing Law...............................     60
SECTION 10.09.               Counterparts; Integration...................     60


                                      -iii-

<PAGE>


                                                                           Page

PRICING SCHEDULE

Exhibit A -- Note
Exhibit B -- Form of Money Market Quote Request
Exhibit C -- Form of Invitation for Money Market
               Quotes
Exhibit D -- Form of Money Market Quote
Exhibit E -- Opinion of General Counsel of the
               Company
Exhibit F -- Opinion of Davis Polk & Wardwell,
               Special Counsel for the Agent
Exhibit G -- Form of Auditor's  Certificate
Exhibit H -- Assignment and Assumption Agreement


                                      -iv-

<PAGE>


                                CREDIT AGREEMENT


                  AGREEMENT  dated  as  of  August  25,  1994  among  KERR-McGEE
CORPORATION,  a Delaware corporation,  KERR-McGEE CREDIT CORPORATION, a Delaware
corporation,  the BANKS listed on the signature pages hereof and MORGAN GUARANTY
TRUST COMPANY OF NEW YORK, as Agent.


                  The parties hereto agree as follows:


                                    ARTICLE I

                                   DEFINITIONS

     SECTION 1.01.  Definitions.  The following terms, as used herein,  have the
following meanings:

     "Absolute Rate Auction" means a solicitation of Money Market Quotes setting
forth Money Market Absolute Rates pursuant to Section 2.03.

     "Acquiring  Person"  means  any  Person  (other  than  the  Company  or any
Subsidiary or any employee benefit plan of the Company or any Subsidiary so long
as all such plans in the aggregate hold less than 40% of the Voting Stock of the
Company) who or which is the beneficial owner,  directly or indirectly,  of more
than ten  percent of the  combined  voting  power of the  outstanding  shares of
Voting Stock of the Company.

     "Adjusted CD Rate" has the meaning set forth in Section 2.07(b).

     "Adjusted  Consolidated  Tangible Net Worth" means,  at any date, an amount
equal to the sum of (i)  Consolidated  Tangible Net Worth at such date plus (ii)
the  excess  (if  any) of (A) an  amount  equal  to the  excess  (if any) of (x)
Consolidated  Tangible Net Worth as at December  31, 1993 over (y)  Consolidated
Tangible Net Worth as at such date over (B) the  aggregate  amount of Restricted
Payments  declared  or  made  (without  duplication)  by  the  Company  and  its
Subsidiaries  during  the  period  from and  including  January  1,  1994 to and
including such date.

     "Administrative  Questionnaire"  means,  with  respect  to  each  Bank,  an
administrative  questionnaire in the form prepared by the Agent and submitted to
the Agent (with a copy to the Company) duly completed by such Bank.

<PAGE>

     "Affiliate"  means a Person (other than the Company or a Subsidiary)  which
directly or indirectly  controls or is controlled by, or is under common control
with the Company or any  Subsidiary.  The term "control"  means the  possession,
directly or  indirectly,  of the power to direct or cause the  direction  of the
management  and policies of a Person,  whether  through the  ownership of Voting
Stock or by contract or otherwise.

     "Agent" means Morgan  Guaranty Trust Company of New York in its capacity as
agent for the Banks hereunder, and its successors in such capacity.

     "Applicable  Lending  Office"  means,  with respect to any Bank, (i) in the
case of its Domestic Loans, its Domestic Lending Office, (ii) in the case of its
Euro-Dollar  Loans, its Euro-Dollar  Lending Office and (iii) in the case of its
Money Market Loans, its Money Market Lending Office.

     "Assessment Rate" has the meaning set forth in Section 2.07(b).

     "Assignee" has the meaning set forth in Section 10.06(c).

     "Bank"  means  each  bank  listed  on  the  signature  pages  hereof,  each
substitute  bank which becomes a Bank  pursuant to Section  8.05,  each Assignee
which  becomes  a Bank  pursuant  to  Section  10.06(c),  and  their  respective
successors.

     "Base Rate" means, for any day, a rate per annum equal to the higher of (i)
the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal Funds
Rate for such day.

     "Base Rate Loan" means a Committed Loan to be made by a Bank as a Base Rate
Loan in accordance with the applicable Notice of Committed Borrowing or pursuant
to Article VIII.

     "Benefit  Liabilities" has the meaning as defined in Section 4001(a)(16) of
ERISA.

     "Borrower"  means  either  of  the  Company  or  Credit  Corporation,   and
"Borrowers" means the Company and Credit Corporation.

     "Borrowing" has the meaning set forth in Section 1.03.

                                        2

<PAGE>

     "CD Base Rate" has the meaning set forth in Section 2.07(b).

     "CD  Loan"  means  a  Committed  Loan  to be made by a Bank as a CD Loan in
accordance with the applicable Notice of Committed Borrowing or Article VIII.

     "CD Margin" has the meaning set forth in Section 2.07(b).

     "CD  Reference  Banks" means  Citibank,  N.A.,  The First  National Bank of
Chicago,  Morgan  Guaranty Trust Company of New York and each such other bank as
may be appointed pursuant to Section 10.06(f).

     "Change of Control" means (i) the  acquisition by any Person or two or more
Persons  acting as a group  (within the meaning of Rule 13d-3 of the  Securities
Exchange Act of 1934) of greater than 40% of the outstanding Voting Stock of the
Company or (ii) any merger or  consolidation to which the Company is a party, or
the transfer,  conveyance or lease of all or substantially  all of the assets of
the  Company  to  another   Person,   if  immediately   following  such  merger,
consolidation,  transfer, conveyance or lease a majority of the directors of the
surviving  corporation (or the corporation  which is the beneficial owner of the
assets  transferred  or conveyed  or the lessee of the assets  leased) are other
than Continuing Directors.

     "Commitment"  means,  with  respect  to each  Bank,  the  amount  set forth
opposite the name of such Bank on the signature pages hereof, as such amount may
be reduced from time to time  pursuant to Section  2.09,  or, as the context may
require, the obligation of such Bank to make Committed Loans hereunder.

     "Committed  Loan"  means a loan to be made by a Bank  pursuant  to  Section
2.01.

     "Company" means Kerr-McGee  Corporation,  a Delaware  corporation,  and its
successors.

     "Company's  1993 Annual  Report" means the Company's  annual report on Form
10-K for 1993, as filed with the Securities and Exchange Commission.

     "Consolidated  Subsidiary"  means,  at any date,  any  Subsidiary  or other
entity the accounts of which would be consolidated  with those of the Company in
its  consolidated  financial  statements if such  statements were prepared as of
such date.

                                        3

<PAGE>

     "Consolidated  Tangible  Net  Worth"  means at any  date  the  consolidated
Stockholders' Equity of the Company and its Consolidated Subsidiaries less their
consolidated  Intangible Assets, all determined as of such date. For purposes of
this definition "Intangible Assets" means the amount of (i) all write-ups (other
than write-ups  resulting from foreign  currency  translations  and write-ups of
assets  of a  going  concern  business  made  within  twelve  months  after  the
acquisition of such business)  subsequent to December 31, 1993 in the book value
of any asset owned by the Company or a Subsidiary, and (ii) all unamortized debt
discount and expense (to the extent, if any, recorded as an unamortized deferred
charge),  unamortized deferred charges, goodwill, patents,  trademarks,  service
marks,  trade  names,  anticipated  future  benefit of tax loss  carry-forwards,
copyrights, organization or developmental expenses.

     "Continuing  Director"  means any member of the Board of  Directors  of the
Company who is unaffiliated  with, and not a nominee of, an Acquiring Person and
was a member of the Board of Directors of the Company  immediately  prior to any
transaction  described in clause (ii) of the definition of Change of Control set
forth in this Section 1.01 and also prior to the time that the Acquiring  Person
became an Acquiring  Person,  and any successor of a Continuing  Director who is
unaffiliated  with,  and not a  nominee  of,  the  Acquiring  Person  and who is
recommended  to  succeed a  Continuing  Director  by a  majority  of  Continuing
Directors then on the Board of Directors.

     "Credit  Corporation"  means  Kerr-McGee  Credit  Corporation,  a  Delaware
corporation, and its successors.

     "Debt" of any Person means,  without  duplication,  (i) all  obligations of
such Person for borrowed money, (ii) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments,  (iii) all obligations of
such  Person  to pay the  deferred  purchase  price of  property,  except  trade
accounts  payable  arising in the  ordinary  course of  business,  (iv) all Debt
secured  by a Lien on any  asset  of  such  Person  which  is not  otherwise  an
obligation of such Person,  to the extent of the lesser of such Debt or the book
value of such  asset,  (v) all Debt of others  Guaranteed  by such Person to the
extent  of the  amount  of such  Guarantee,  and  (vi) all  production  payment,
proceeds production payment or similar obligations of such Person; provided that
(a) Debt shall not include any Debt described  above with respect to which there
shall have been irrevocably  deposited in trust,  cash, or direct obligations of
the United  States,  or any agency thereof that are backed by the full faith and
credit of the United States, as necessary for the timely redemption,  payment or
satisfaction

                                        4

<PAGE>

of such Debt and (b) the Debt of any  Subsidiary  arising as a result of being a
general  partner or joint venturer shall not constitute  Debt to the extent such
obligations  exceed the Company's direct or indirect net book investment in such
Subsidiary.

     "Debt Acceleration  Threshold" means (i) $5,000,000 in the case of any Debt
other than LDC Debt and (ii) $40,000,000 in the case of LDC Debt.

     "Default"  means  any  condition  or event  which  constitutes  an Event of
Default  or which  with the  giving of  notice  or lapse of time or both  would,
unless cured or waived, become an Event of Default.

     "Derivatives  Obligations"  of any  Person  means all  obligations  of such
Person in  respect  of any rate  swap  transaction,  basis  swap,  forward  rate
transaction,  commodity  swap,  commodity  option,  equity or equity index swap,
equity or equity index  option,  bond  option,  interest  rate  option,  foreign
exchange transaction,  cap transaction,  floor transaction,  collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar  transaction  (including  any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.

     "Domestic  Business  Day" means any day except a Saturday,  Sunday or other
day on which commercial banks in New York City are authorized by law to close.

     "Domestic Lending Office" means, as to each Bank, its office located at its
address set forth in its  Administrative  Questionnaire  (or  identified  in its
Administrative  Questionnaire  as its  Domestic  Lending  Office)  or such other
office as such Bank may hereafter  designate as its Domestic  Lending  Office by
notice to the Company  and the Agent;  provided  that any Bank may so  designate
separate  Domestic Lending Offices for its Base Rate Loans, on the one hand, and
its CD Loans,  on the other  hand,  in which case all  references  herein to the
Domestic  Lending Office of such Bank shall be deemed to refer to either or both
of such offices, as the context may require.

     "Domestic Loans" means CD Loans or Base Rate Loans or both.

     "Domestic Reserve Percentage" has the meaning set forth in Section 2.07(b).

     "Effective  Date"  means  the date  this  Agreement  becomes  effective  in
accordance with Section 3.01.

                                        5

<PAGE>

     "ERISA"  means the Employee  Retirement  Income  Security  Act of 1974,  as
amended, or any successor statute.

     "Euro-Dollar  Business  Day"  means  any  Domestic  Business  Day on  which
commercial  banks are open for  international  business  (including  dealings in
dollar deposits) in London.

     "Euro-Dollar Lending Office" means, as to each Bank, its office,  branch or
affiliate located at its address set forth in its  Administrative  Questionnaire
(or identified in its  Administrative  Questionnaire as its Euro-Dollar  Lending
Office)  or such  other  office,  branch  or  affiliate  of such  Bank as it may
hereafter  designate as its Euro-Dollar  Lending Office by notice to the Company
and the Agent.

     "Euro-Dollar  Loan"  means  a  Committed  Loan  to be  made  by a Bank as a
Euro-Dollar Loan in accordance with the applicable Notice of Committed Borrowing
or Article VIII.

     "Euro-Dollar Margin" has the meaning set forth in Section 2.07(c).

     "Euro-Dollar  Reference  Banks"  means  the  principal  London  offices  of
Citibank,  N.A.,  The First  National  Bank of Chicago,  Morgan  Guaranty  Trust
Company  of New York and each such other bank as may be  appointed  pursuant  to
Section 10.06(f).

     "Euro-Dollar  Reserve  Percentage"  has the  meaning  set forth in  Section
2.16(b).

     "Event of Default" has the meaning set forth in Section 6.01.

     "Existing  Credit  Agreement" means the Credit Agreement dated as of August
15, 1990 among the Borrower, the banks parties thereto and Morgan Guaranty Trust
Company of New York, as agent, as amended to the Effective Date.

     "Federal  Funds  Rate"  means,  for any day,  the rate per  annum  (rounded
upward,  if  necessary,  to the  nearest  1/100th  of 1%) equal to the  weighted
average of the rates on overnight Federal funds transactions with members of the
Federal  Reserve  System  arranged  by Federal  funds  brokers  on such day,  as
published by the Federal  Reserve Bank of New York on the Domestic  Business Day
next  succeeding  such  day,  provided  that (i) if such  day is not a  Domestic
Business  Day,  the  Federal  Funds Rate for such day shall be such rate on such
transactions on the next preceding  Domestic Business Day as so published on the
next succeeding  Domestic Business Day, and (ii) if no such rate is so published
on such next

                                        6

<PAGE>

succeeding  Domestic  Business Day, the Federal Funds Rate for such day shall be
the average rate quoted to Morgan Guaranty Trust Company of New York on such day
on such transactions as determined by the Agent.

     "Fixed  Rate Loans"  means CD Loans or  Euro-Dollar  Loans or Money  Market
Loans  (excluding  Money  Market LIBOR Loans  bearing  interest at the Base Rate
pursuant to Section 8.01(a)) or any combination of the foregoing.

     "Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person entered into for the purpose of directly or indirectly  guaranteeing
any Debt of any other Person  including,  without limiting the generality of the
foregoing, any obligation,  direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or  advance or supply  funds for the  purchase or
payment  of) such Debt or (ii)  entered  into for the purpose of assuring in any
other  manner the holder of such Debt of the payment  thereof or to protect such
holder against loss in respect thereof (in whole or in part),  provided that (x)
the term Guarantee shall not include  endorsements  for collection or deposit in
the ordinary  course of  business,  and (y) in no event shall a Guarantee by the
Company or a Subsidiary of the Debt of the Company or a Subsidiary be duplicated
for  purposes of  determining  an amount of Debt for purposes  hereof.  The term
"Guarantee" used as a verb has a corresponding meaning.

     "Interest  Period" means: (1) with respect to each  Euro-Dollar  Borrowing,
the period  commencing on the date of such  Borrowing and ending one, two, three
or six months thereafter,  as the Borrower may elect in the applicable Notice of
Borrowing; provided that:

                  (a) any  Interest  Period which would  otherwise  end on a day
         which is not a  Euro-Dollar  Business Day shall be extended to the next
         succeeding  Euro-Dollar  Business Day unless such Euro-Dollar  Business
         Day falls in another calendar month, in which case such Interest Period
         shall end on the next preceding Euro-Dollar Business Day;

                  (b) any Interest  Period which begins on the last  Euro-Dollar
         Business  Day of a  calendar  month (or on a day for which  there is no
         numerically  corresponding day in the calendar month at the end of such
         Interest  Period) shall,  subject to clause (c) below,  end on the last
         Euro-Dollar Business Day of a calendar month; and

                                        7

<PAGE>

                  (c) any Interest  Period which would  otherwise  end after the
         Termination Date shall end on the Termination Date.

(2) With respect to each CD Borrowing, the period commencing on the date of such
Borrowing  and ending 30, 60, 90 or 180 days  thereafter,  as the  Borrower  may
elect in the applicable Notice of Borrowing; provided that:

                  (a) any  Interest  Period which would  otherwise  end on a day
         which is not a  Euro-Dollar  Business Day shall be extended to the next
         succeeding Euro-Dollar Business Day; and

                  (b) any Interest  Period which would  otherwise  end after the
         Termination Date shall end on the Termination Date.

(3) With respect to each Base Rate Borrowing,  the period commencing on the date
of such Borrowing and ending 30 days thereafter; provided that:

                  (a) any  Interest  Period which would  otherwise  end on a day
         which is not a  Euro-Dollar  Business Day shall be extended to the next
         succeeding Euro-Dollar Business Day; and

                  (b) any Interest  Period which would  otherwise  end after the
         Termination Date shall end on the Termination Date.

(4) With respect to each Money Market LIBOR Borrowing,  the period commencing on
the date of such Borrowing and ending such whole number of months  thereafter as
the Borrower may elect in accordance with Section 2.03; provided that:

                  (a) any  Interest  Period which would  otherwise  end on a day
         which is not a  Euro-Dollar  Business Day shall be extended to the next
         succeeding  Euro-Dollar  Business Day unless such Euro-Dollar  Business
         Day falls in another calendar month, in which case such Interest Period
         shall end on the next preceding Euro-Dollar Business Day;

                  (b) any Interest  Period which begins on the last  Euro-Dollar
         Business  Day of a  calendar  month (or on a day for which  there is no
         numerically  corresponding day in the calendar month at the end of such
         Interest  Period) shall,  subject to clause (c) below,  end on the last
         Euro-Dollar Business Day of a calendar month; and

                                        8

<PAGE>

                  (c) any Interest  Period which would  otherwise  end after the
         Termination Date shall end on the Termination Date.

(5) With  respect to each  Money  Market  Absolute  Rate  Borrowing,  the period
commencing  on the  date  of such  Borrowing  and  ending  such  number  of days
thereafter  (but not less than 7 days) as the Borrower  may elect in  accordance
with Section 2.03; provided that:

                  (a) any  Interest  Period which would  otherwise  end on a day
         which is not a  Euro-Dollar  Business Day shall be extended to the next
         succeeding Euro-Dollar Business Day; and

                  (b) any Interest  Period which would  otherwise  end after the
         Termination Date shall end on the Termination Date.

     "Internal  Revenue  Code"  means  the  Internal  Revenue  Code of 1986,  as
amended, or any successor statute.

     "LDC Country"  means any country which is not a member of the  Organization
for Economic Co-operation and Development.

     "LDC Debt" means any Debt of a  Subsidiary  of the Company  (whether or not
Guaranteed by the Company) incurred to finance the conduct of business in an LDC
Country.

     "LIBOR  Auction" means a solicitation  of Money Market Quotes setting forth
Money Market  Margins  based on the London  Interbank  Offered Rate  pursuant to
Section 2.03.

     "Lien"  means,  with  respect to any asset,  any  mortgage,  lien,  pledge,
charge,  security  interest or  encumbrance of any kind in respect of such asset
(including  any  production  payment,  proceeds  production  payment  or similar
financing  arrangement  with  respect  to  such  asset).  Without  limiting  the
generality of the foregoing, for the purposes of this Agreement, (i) the Company
or any  Subsidiary  shall be deemed to own  subject to a Lien any asset which it
has  acquired or holds  subject to the  interest of a vendor or lessor under any
conditional sale agreement or other title retention  agreement  relating to such
asset  and (ii) the  sale or  assignment  by  Credit  Corporation  or any of its
Subsidiaries  ("seller")  of  Receivables  shall be deemed to create Debt of the
seller (in an amount  equal to the  proceeds  of the sale)  secured by a Lien on
Receivables  of the seller unless either (A) such  transaction is a sale without
recourse  for cash  payable  on the date of sale in an amount  not less than the
fair market value of the

                                        9

<PAGE>

Receivables  sold or (B) such  transaction  is (or would be, if the  Receivables
were  accounts)  excluded from the scope of article 9 of the Uniform  Commercial
Code (as in effect in the State of New York) by Section 9-104(f) thereof.

     "Loan" means a Domestic Loan or a  Euro-Dollar  Loan or a Money Market Loan
and "Loans" means Domestic  Loans or Euro-Dollar  Loans or Money Market Loans or
any combination of the foregoing.

     "London  Interbank  Offered  Rate" has the  meaning  set  forth in  Section
2.07(c).
     "Material  Financial  Obligations" means a principal or face amount of Debt
and/or payment obligations in respect of Derivatives Obligations of the Borrower
and/or  one or more of its  Subsidiaries,  arising  in one or  more  related  or
unrelated transactions, exceeding in the aggregate $10,000,000.

     "Material  Subsidiary" means, at any time, Credit Corporation and any other
Subsidiary  which  as of  such  time  meets  the  definition  of a  "significant
subsidiary"  with  respect to the  Company  contained  as of the date  hereof in
Regulation S-X of the Securities and Exchange Commission.

     "Money Market Absolute Rate" has the meaning set forth in Section 2.03(d).

     "Money  Market  Absolute  Rate  Loan"  means  a loan  to be  made by a Bank
pursuant to an Absolute Rate Auction.

     "Money Market Lending Office" means, as to each Bank, its Domestic  Lending
Office  or such  other  office,  branch  or  affiliate  of  such  Bank as it may
hereafter  designate as its Money Market Lending Office by notice to the Company
and the  Agent;  provided  that any Bank may from  time to time by notice to the
Company and the Agent  designate  separate Money Market Lending  Offices for its
Money Market LIBOR Loans,  on the one hand,  and its Money Market  Absolute Rate
Loans,  on the other  hand,  in which  case all  references  herein to the Money
Market Lending Office of such Bank shall be deemed to refer to either or both of
such offices, as the context may require.

     "Money  Market LIBOR Loan" means a loan to be made by a Bank  pursuant to a
LIBOR Auction  (including such a loan bearing interest at the Base Rate pursuant
to Section 8.01(a)).

     "Money  Market  Loan"  means a Money  Market  LIBOR Loan or a Money  Market
Absolute Rate Loan.

                                       10

<PAGE>

     "Money Market Margin" has the meaning set forth in Section 2.03(d).

     "Money  Market  Quote" means an offer by a Bank to make a Money Market Loan
in accordance with Section 2.03.

     "Moody's" means Moody's Investors Service, Inc.

     "Multiemployer  Plan" means any  employee  pension  benefit plan within the
meaning of Section 4001(a)(3) of ERISA or an employee pension benefit plan as to
which  the  Company  or  any  of its  Related  Persons  would  be  treated  as a
contributing  employer  under  Section  4212(c)  of  ERISA  if  it  were  to  be
terminated.
     "Notes" means promissory notes of a Borrower,  substantially in the form of
Exhibit A hereto,  evidencing the obligation of such Borrower to repay the Loans
made to it, and "Note" means any one of such promissory notes issued hereunder.

     "Notice of Borrowing" means a Notice of Committed  Borrowing (as defined in
Section  2.02) or a Notice of Money  Market  Borrowing  (as  defined  in Section
2.03(f)).

     "Parent"  means,  with  respect  to any Bank,  any  Person,  other  than an
individual, controlling such Bank.

     "Participant" has the meaning set forth in Section 10.06(b).

     "PBGC"  means  the  Pension  Benefit  Guaranty  Corporation  or any  entity
succeeding to any or all of its functions under ERISA.

     "Person" means an individual, a corporation, a partnership, an association,
a trust or any other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.

     "Plan" means an "employee pension benefit plan" (as defined in Section 3 of
ERISA) (other than a  Multiemployer  Plan) which is or has been  established and
maintained,  or to which contributions are or have been made, by the Company, or
an employee  pension  benefit plan as to which the Company or any of its Related
Persons would be treated as a  contributory  sponsor under Section 4069 of ERISA
if it were to be terminated.

     "Pricing Schedule" means the Schedule attached hereto identified as such.

                                       11

<PAGE>

     "Prime  Rate"  means  the rate of  interest  publicly  announced  by Morgan
Guaranty  Trust  Company  of New York in New York  City from time to time as its
Prime Rate.

     "Property"  means any  interest in any kind of  property or asset,  whether
real, personal or mixed, or tangible or intangible.

     "Receivable" means any right to payment of money, whether for goods sold or
leased or to be sold or leased, services rendered or to be rendered,  money lent
or  other  credit  extended,  or  otherwise,  whether  or  not  evidenced  by an
instrument.

     "Reference Banks" means the CD Reference Banks or the Euro-Dollar Reference
Banks,  as the context may require,  and "Reference  Bank" means any one of such
Reference Banks.

     "Refunding  Borrowing" means a Committed  Borrowing or that portion thereof
which, after application of the proceeds thereof,  results in no net increase in
the outstanding  principal  amount of Committed Loans made by any Bank to either
Borrower.

     "Regulation U" means  Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.

     "Related Person" means any trade or business  (whether or not incorporated)
which,  together with the Company (and other Related  Persons),  is treated as a
single employer under Section 414 of the Internal Revenue Code.

     "Required  Banks"  means  at any time  Banks  having  more  than 50% of the
aggregate  amount of the  Commitments  or, if the  Commitments  shall  have been
terminated,  holding  Notes  evidencing  more than 50% of the  aggregate  unpaid
principal amount of the Loans.

     "Restricted  Payment" means (i) any dividend or other  distribution  on any
shares of the Company's capital stock (except  dividends or other  distributions
payable solely in shares of its capital stock) or (ii) any payment on account of
the purchase,  redemption,  retirement or  acquisition  of (a) any shares of the
Company's  capital  stock or (b) any  option,  warrant or other right to acquire
shares of the  Company's  capital  stock;  provided  that payments in respect of
employee stock options, stock appreciation rights and other stock based employee
compensation   arrangements  in  the  ordinary  course  of  business  shall  not
constitute Restricted Payments.

                                       12

<PAGE>

     "Restricted  Property",  to the extent of the Company's  direct or indirect
interest therein, means:

                  (a)  any  property  interest  owned  by  the  Company  or  any
         Consolidated Subsidiary in reserves of oil, gas, coal lignite, uranium,
         copper or other minerals which are "proved reserves", as defined in the
         regulations  promulgated by the Securities and Exchange  Commission or,
         in the absence of an applicable definition,  reserves which geological,
         geophysical and engineering data demonstrate with reasonable  certainty
         to be  recoverable  in future years from known  reservoirs  or deposits
         under existing economic and operating conditions; and

                  (b) any  refining or  manufacturing  property or any  drilling
         rigs  and  related   equipment  of  the  Company  or  any  Consolidated
         Subsidiary.

     "Revolving Credit Period" means the period from and including the Effective
Date to but not including the Termination Date.

     "S&P" means Standard & Poor's Corporation.

     "Stockholders'  Equity" means, at any date, the consolidated  stockholders'
equity of the Company and its  Consolidated  Subsidiaries as would be shown on a
balance  sheet  prepared  in  accordance  with  generally  accepted   accounting
principles as of such date.

     "Subsidiary"  means any corporation or other entity of which  securities or
other  ownership  interests  having ordinary voting power to elect a majority of
the board of directors or other persons  performing similar functions are at the
time directly or indirectly owned by the Company.

     "Substitute  Loan" means a Loan made by a Bank  pursuant  to Section  8.02,
8.03 or 8.04(a).

     "Termination  Date"  means  August  25,  1999,  or,  if  such  day is not a
Euro-Dollar  Business Day, the next succeeding  Euro-Dollar  Business Day unless
such Euro-Dollar Business Day falls in another calendar month, in which case the
Termination Date shall be the next preceding Euro-Dollar Business Day.

     "Unfunded  Benefit  Liabilities"  means the  "amount  of  unfunded  benefit
liabilities" as defined in Section 4001(a) (18) of ERISA.

                                       13
<PAGE>

     "Voting  Stock"  means  capital  stock  of any  class or  classes  (however
designated)  having  ordinary  voting power for the election of directors of the
Company, other than stock having such power only by reason of the happening of a
contingency.

     SECTION  1.02.  Accounting  Terms  and  Determinations.   Unless  otherwise
specified  herein,  all accounting  terms used herein shall be interpreted,  all
accounting  determinations hereunder shall be made, and all financial statements
required  to be  delivered  hereunder  shall  be  prepared  in  accordance  with
generally accepted accounting principles as in effect from time to time, applied
on a  basis  consistent  (except  for  changes  concurred  in by  the  Company's
independent  public  accountants)  with the  most  recent  audited  consolidated
financial statements of the Company and its Consolidated  Subsidiaries delivered
to the Banks.

     SECTION  1.03.  Types of  Borrowings.  The  term  "Borrowing"  denotes  the
aggregation  of  Loans  of one or more  Banks  to be made to a  single  Borrower
pursuant  to Article II (and not, in any event,  pursuant to Article  VIII) on a
single date and for a single  Interest  Period.  Borrowings  are  classified for
purposes  of  this  Agreement  either  by  reference  to the  pricing  of  Loans
comprising  such  Borrowing  (e.g.,  a  "Euro-Dollar  Borrowing"  is a Borrowing
comprised of Euro-Dollar  Loans) or by reference to the provisions of Article II
under which participation  therein is determined (i.e., a "Committed  Borrowing"
is a Borrowing  under Section 2.01 in which all Banks  participate in proportion
to their  Commitments,  while a "Money Market  Borrowing"  is a Borrowing  under
Section 2.03 in which the Bank participants are determined on the basis of their
bids in accordance therewith).


                                   ARTICLE II

                                   THE CREDITS

     SECTION 2.01.  Commitments to Lend. During the Revolving Credit Period each
Bank severally  agrees, on the terms and conditions set forth in this Agreement,
to make loans to either  Borrower  pursuant to this Section from time to time in
amounts such that the aggregate principal amount of Committed Loans by such Bank
at any one time outstanding to both Borrowers shall not exceed the amount of its
Commitment. Each Borrowing under this Section shall be in an aggregate principal
amount of $10,000,000 or any larger multiple of $1,000,000 (except that any such
Borrowing may be in the aggregate amount available in accordance with

                                       14

<PAGE>

Section  3.02(b)) and shall be made from the several Banks ratably in proportion
to their  respective  Commitments.  Within the foregoing  limits, a Borrower may
borrow under this Section,  repay,  or to the extent  permitted by Section 2.11,
prepay Loans and reborrow at any time during the  Revolving  Credit Period under
this Section.

                  SECTION 2.02.  Notice of Committed Borrowings.

     (a) The  Borrower  shall  give the Agent  notice (a  "Notice  of  Committed
Borrowing")  not later than  10:30 A.M.  (New York City time) on (x) the date of
each Base Rate Borrowing,  (y) the second  Domestic  Business Day before each CD
Borrowing  and (z) the third  Euro-Dollar  Business Day before each  Euro-Dollar
Borrowing, specifying:

              (i)  the  date  of  such  Borrowing,  which  shall  be a  Domestic
         Business  Day in the  case of a  Domestic  Borrowing  or a  Euro-Dollar
         Business Day in the case of a Euro-Dollar Borrowing,

             (ii)  the aggregate amount of such Borrowing,

            (iii)  whether  the Loans  comprising  such  Borrowing  are to be CD
         Loans, Base Rate Loans or Euro-Dollar Loans, and

             (iv) in the case of a Fixed Rate  Borrowing,  the  duration  of the
         Interest Period  applicable  thereto,  subject to the provisions of the
         definition of Interest Period.

     (b) The provisions of subsection (a) above notwithstanding, if the Borrower
shall not have given a Notice of Borrowing  not later than 10:30 A.M.  (New York
City time) on the last day of the Interest  Period  applicable to an outstanding
Committed  Borrowing,  then,  unless the Borrower notifies the Agent before such
time that it elects  not to borrow on such  date,  the Agent  shall be deemed to
have received a Notice of Committed  Borrowing  specifying  (i) that the date of
the proposed  Borrowing shall be the last day of the Interest Period  applicable
to such  outstanding  Borrowing,  (ii) that the aggregate amount of the proposed
Borrowing shall be the amount of such outstanding Borrowing,  and (iii) that the
Loans comprising the proposed Borrowing are to be Base Rate Loans.

                  SECTION 2.03.  Money Market Borrowings.

     (a) The Money Market Option. In addition to Committed  Borrowings  pursuant
to Section 2.01, either Borrower may, as set forth in this Section, request the
27008/958/CA/ca.conf

                                       15

<PAGE>

Banks  during the  Revolving  Credit  Period to make offers to make Money Market
Loans to such  Borrower.  The Banks may, but shall have no  obligation  to, make
such offers and the Borrower  may, but shall have no  obligation  to, accept any
such offers in the manner set forth in this Section.

     (b) Money Market Quote Request. When a Borrower wishes to request offers to
make Money Market Loans under this  Section,  it shall  transmit to the Agent by
telex or facsimile  transmission a Money Market Quote request  substantially  in
the form of Exhibit B hereto so as to be received no later than 10:30 A.M.  (New
York City time) on (x) the fifth  Euro-Dollar  Business Day prior to the date of
Borrowing  proposed therein,  in the case of a LIBOR Auction or (y) the Domestic
Business Day next preceding the date of Borrowing proposed therein,  in the case
of an Absolute Rate Auction (or, in either case,  such other time or date as the
Company and the Agent shall have mutually  agreed and shall have notified to the
Banks not later than the date of the Money  Market  Quote  request for the first
LIBOR Auction or Absolute Rate Auction for which such change is to be effective)
specifying:

              (i)  the   proposed   date   of   Borrowing,   which  shall  be  a
         Euro-Dollar  Business Day in the case of a LIBOR  Auction or a Domestic
         Business Day in the case of an Absolute Rate Auction,

             (ii)  the  aggregate  amount  of such  Borrowing,  which  shall  be
         $10,000,000 or a larger multiple of $1,000,000,

            (iii)  the  duration  of the  Interest  Period  applicable  thereto,
         subject to the provisions of the definition of Interest Period, and

             (iv) whether the Money Market  Quotes  requested are to set forth a
         Money Market Margin or a Money Market Absolute Rate.

The  Borrower  may request  offers to make Money  Market Loans for more than one
Interest  Period in a single Money Market Quote  request.  No Money Market Quote
request  shall be given  within five  Euro-Dollar  Business  Days (or such other
number of days as the Company and the Agent may agree) of any other Money Market
Quote request.

     (c) Invitation  for Money Market  Quotes.  Promptly upon receipt of a Money
Market  Quote  request,  the Agent shall send to the Banks by telex or facsimile
transmission an invitation for Money Market Quotes  substantially in the form of
Exhibit C hereto, which shall constitute an

                                       16

<PAGE>

invitation by the Borrower to each Bank to submit Money Market  Quotes  offering
to make the Money Market Loans to which such Money Market Quote request  relates
in accordance with this Section.

     (d)  Submission  and  Contents of Money  Market  Quotes.  (i) Each Bank may
submit a Money Market Quote  containing  an offer or offers to make Money Market
Loans in response to any Invitation  for Money Market Quotes.  Each Money Market
Quote must  comply  with the  requirements  of this  subsection  (d) and must be
submitted  to the  Agent by  telex  or  facsimile  transmission  at its  offices
specified in or pursuant to Section 10.01 not later than (x) 2:00 P.M. (New York
City time) on the fourth Euro-Dollar  Business Day prior to the proposed date of
Borrowing,  in the case of a LIBOR Auction or (y) 9:30 A.M. (New York City time)
on the proposed date of Borrowing,  in the case of an Absolute Rate Auction (or,
in either case,  such other time or date as the Company and the Agent shall have
mutually  agreed and shall have notified to the Banks not later than the date of
the Money  Market  Quote  request for the first LIBOR  Auction or Absolute  Rate
Auction for which such change is to be  effective);  provided  that Money Market
Quotes submitted by the Agent (or any affiliate of the Agent) in the capacity of
a Bank  may be  submitted,  and may  only be  submitted,  if the  Agent  or such
affiliate  notifies the  Borrower of the terms of the offer or offers  contained
therein  not  later  than (x) 1:00  P.M.  (New  York  City  time) on the  fourth
Euro-Dollar Business Day prior to the proposed date of Borrowing, in the case of
a LIBOR  Auction or (y) 9:15 A.M.  (New York City time) on the proposed  date of
Borrowing, in the case of an Absolute Rate Auction.  Subject to Articles III and
VI, any Money Market Quote so made shall be irrevocable  except with the written
consent of the Agent given on the instructions of the Borrower.

     (ii) Each Money Market Quote shall be in substantially  the form of Exhibit
D hereto and shall in any case specify:

                  (A)  the proposed date of Borrowing,

                  (B) the  principal  amount of the Money  Market Loan for which
         each  such  offer is being  made,  which  principal  amount  (w) may be
         greater than, equal to or less than the Commitment of the quoting Bank,
         (x) must be $5,000,000 or a larger multiple of $1,000,000,  (y) may not
         exceed the principal amount of Money Market Loans for which offers were
         requested,  and (z) may be subject to an aggregate limitation as to the
         principal  amount of Money  Market Loans for which offers being made by
         such quoting Bank may be accepted,

                                       17

<PAGE>

                  (C) in the case of a LIBOR Auction,  the margin above or below
         the  applicable  London  Interbank  Offered  Rate  (the  "Money  Market
         Margin")  offered  for each such  Money  Market  Loan,  expressed  as a
         percentage  (specified to the nearest  1/10,000th of 1%) to be added to
         or subtracted from such base rate,

                  (D) in the  case of an  Absolute  Rate  Auction,  the  rate of
         interest per annum  (specified  to the nearest  1/10,000th  of 1%) (the
         "Money Market  Absolute Rate") offered for each such Money Market Loan,
         and

                  (E) the identity of the quoting Bank.

A Money  Market  Quote may set forth up to five  separate  offers by the quoting
Bank with respect to each Interest  Period  specified in the related  Invitation
for Money Market Quotes.

                  (iii) Any Money Market Quote shall be disregarded if it:

                  (A) is not  substantially  in conformity with Exhibit D hereto
         or does not  specify  all of the  information  required  by  subsection
         (d)(ii);

                  (B) contains qualifying, conditional or similar language;

                  (C)  proposes  terms  other than or in  addition  to those set
         forth in the applicable Invitation for Money Market Quotes; or

                  (D) arrives after the time set forth in subsection (d)(i).

     (e) Notice to Borrower. The Agent shall promptly notify the Borrower of the
terms (x) of any Money  Market Quote  submitted by a Bank that is in  accordance
with  subsection (d) and (y) of any Money Market Quote that amends,  modifies or
is otherwise  inconsistent  with a previous Money Market Quote submitted by such
Bank with respect to the same Money Market Quote  request.  Any such  subsequent
Money Market  Quote shall be  disregarded  by the Agent  unless such  subsequent
Money  Market  Quote is  submitted  solely to correct a  manifest  error in such
former Money Market Quote.  The Agent's notice to the Borrower shall specify (A)
the aggregate  principal amount of Money Market Loans for which offers have been
received for each  Interest  Period  specified in the related Money Market Quote
request,  (B) the respective principal amounts and Money Market Margins or Money
Market Absolute Rates, as the case may be,

                                       18

<PAGE>

so offered and (C) if applicable,  limitations on the aggregate principal amount
of Money  Market  Loans for which offers in any single Money Market Quote may be
accepted.

     (f) Acceptance and Notice by Borrower.  Not later than 10:30 A.M. (New York
City time) on (x) the third Euro-Dollar  Business Day prior to the proposed date
of  Borrowing,  in the  case of a LIBOR  Auction  or (y)  the  proposed  date of
Borrowing,  in the case of an Absolute  Rate Auction  (or, in either case,  such
other time or date as the Company and the Agent shall have  mutually  agreed and
shall have  notified  to the Banks not later  than the date of the Money  Market
Quote  request for the first LIBOR  Auction or Absolute  Rate  Auction for which
such change is to be  effective),  the  Borrower  shall  notify the Agent of its
acceptance  or  non-acceptance  of the  offers so  notified  to it  pursuant  to
subsection  (e).  In the case of  acceptance,  such  notice (a  "Notice of Money
Market  Borrowing")  shall specify the aggregate  principal amount of offers for
each Interest Period that are accepted. The Borrower may accept any Money Market
Quote in whole or in part; provided that:

              (i)  the   aggregate   principal   amount  of  each  Money  Market
         Borrowing may not exceed the applicable amount set forth in the related
         Money Market Quote request,

             (ii) the principal  amount of each Money Market  Borrowing  must be
         $5,000,000 or a larger multiple of $1,000,000,

            (iii)  acceptance  of  offers  may  only  be made  on the  basis  of
         ascending  Money Market Margins or Money Market  Absolute Rates, as the
         case may be, and

             (iv) the  Borrower  may not accept any offer that is  described  in
         subsection  (d)(iii)  or  that  otherwise  fails  to  comply  with  the
         requirements of this Agreement.

     (g)  Allocation by Agent.  If offers are made by two or more Banks with the
same Money Market Margins or Money Market  Absolute  Rates,  as the case may be,
for a greater  aggregate  principal  amount  than the amount in respect of which
such offers are accepted for the related Interest  Period,  the principal amount
of Money  Market  Loans in respect of which such  offers are  accepted  shall be
allocated by the Agent among such Banks as nearly as possible  (in  multiples of
$1,000,000,  as the Agent may deem  appropriate)  in proportion to the aggregate
principal amounts of such offers. Determinations by the Agent of the

                                       19

<PAGE>

amounts of Money  Market  Loans shall be  conclusive  in the absence of manifest
error.

     SECTION  2.04.  Notice to Banks;  Funding of Loans.  (a) Upon  receipt  (or
deemed  receipt) of a Notice of Borrowing,  the Agent shall promptly notify each
Bank of the contents thereof and of such Bank's share (if any) of such Borrowing
and such Notice of Borrowing  shall not  thereafter be revocable by the Borrower
giving (or deemed to have given) such Notice of Borrowing.

     (b) Not later  than  12:00  Noon  (New York City  time) on the date of each
Borrowing,  each  Bank  participating  therein  shall  (except  as  provided  in
subsection (c) of this Section) make available its share of such  Borrowing,  in
Federal or other funds  immediately  available in New York City, to the Agent at
its  address  specified  in or  pursuant  to  Section  10.01.  Unless  the Agent
determines that any applicable  condition  specified in Article III has not been
satisfied, the Agent will make the funds so received from the Banks available to
the Borrower at the Agent's aforesaid address.

     (c) If any Bank makes a new Loan  hereunder to a Borrower on a day on which
such Borrower is to repay all or any part of an outstanding Loan from such Bank,
such Bank shall apply the  proceeds of its new Loan to make such  repayment  and
only an  amount  equal to the  difference  (if any)  between  the  amount  being
borrowed by such Borrower and the amount being repaid shall be made available by
such  Bank to the  Agent as  provided  in  subsection  (b) of this  Section,  or
remitted by such  Borrower to the Agent as provided in Section 2.13, as the case
may be.

     (d) Unless the Agent  shall have  received  notice from a Bank prior to the
date of any Borrowing  that such Bank will not make  available to the Agent such
Bank's  share of such  Borrowing,  the Agent may assume  that such Bank has made
such share  available to the Agent on the date of such  Borrowing in  accordance
with subsections (b) and (c) of this Section 2.04 and the Agent may, in reliance
upon  such   assumption,   make  available  to  the  Borrower  on  such  date  a
corresponding amount. If and to the extent that such Bank shall not have so made
such share available to the Agent, such Bank and the Borrower severally agree to
repay to the Agent forthwith on demand such  corresponding  amount together with
interest  thereon,  for each day from the date such amount is made  available to
the  Borrower  until the date such amount is repaid to the Agent,  at a rate per
annum  equal to the Federal  Funds  Rate.  If such Bank shall repay to the Agent
such corresponding amount, such amount so repaid shall

                                       20

<PAGE>

constitute  such Bank's Loan  included in such  Borrowing  for  purposes of this
Agreement.

     SECTION 2.05.  Notes.  (a) The Loans of each Bank to each Borrower shall be
evidenced  by a single Note of such  Borrower  payable to the order of such Bank
for the  account  of its  Applicable  Lending  Office in an amount  equal to the
aggregate unpaid principal amount of such Bank's Loans to such Borrower.

     (b) Each Bank may,  upon at least two Domestic  Business  Days' notice to a
Borrower  and the Agent,  request  that its Loans of a  particular  type to such
Borrower be evidenced by a separate  Note of such Borrower in an amount equal to
the aggregate unpaid principal amount of such Loans.  Each such Note shall be in
substantially  the form of Exhibit A hereto with  appropriate  modifications  to
reflect the fact that it  evidences  solely  Loans of the  relevant  type.  Each
reference  in this  Agreement  to a "Note" or the  "Notes" of such Bank shall be
deemed to refer to and  include  any or all of such  Notes,  as the  context may
require.

     (c) Upon  receipt of each Bank's  Notes  pursuant to Section  3.01(b),  the
Agent shall  forward  such Note to such Bank.  Each Bank shall  record the date,
amount,  type and maturity of each Loan made by it to each Borrower and the date
and amount of each payment of principal made with respect  thereto,  and may, if
such Bank so elects in connection  with any transfer or  enforcement of its Note
of either Borrower,  endorse on the schedule forming a part thereof  appropriate
notations to evidence the foregoing  information  with respect to each such Loan
to such Borrower then outstanding; provided that the failure of any Bank to make
any such  recordation or endorsement  shall not affect the obligations of either
Borrower  hereunder  or  under  the  Notes.  Each  Bank  is  hereby  irrevocably
authorized  by each Borrower so to endorse its Notes and to attach to and make a
part of any Note a continuation of any such schedule as and when required.

     SECTION 2.06.  Maturity of Loans. Each Loan included in any Borrowing shall
mature,  and the principal amount thereof shall be due and payable,  on the last
day of the Interest Period applicable to such Borrowing.

     SECTION 2.07.  Interest Rates.  (a) Each Base Rate Loan shall bear interest
on the outstanding  principal  amount  thereof,  for each day from the date such
Loan is made until it becomes  due,  at a rate per annum  equal to the Base Rate
for such day.  Such interest  shall be payable for each  Interest  Period on the
last day  thereof.  Any overdue  principal  of or interest on any Base Rate Loan
shall bear

                                       21

<PAGE>

interest,  payable on demand,  for each day until paid at a rate per annum equal
to the sum of 1% plus the rate otherwise  applicable to Base Rate Loans for such
day.

     (b) Each CD Loan shall bear interest on the  outstanding  principal  amount
thereof,  for each day during the Interest Period applicable  thereto, at a rate
per annum  equal to the sum of the CD Margin for such day plus the  Adjusted  CD
Rate  applicable  to such Interest  Period;  provided that if any CD Loan or any
portion  thereof  shall,  as a result of  clause  (2)(b)  of the  definition  of
Interest  Period,  have an Interest  Period of less than 30 days,  such  portion
shall bear interest  during such Interest  Period at the rate applicable to Base
Rate Loans during such period.  Such interest shall be payable for each Interest
Period on the last day thereof  and, if such  Interest  Period is longer than 90
days, at intervals of 90 days after the first day thereof. Any overdue principal
of or interest on any CD Loan shall bear interest,  payable on demand,  for each
day until paid at a rate per annum equal to the sum of 1% plus the higher of (i)
the sum of the CD Margin for such day plus the  Adjusted CD Rate  applicable  to
the  Interest  Period  for such Loan and (ii) the rate  applicable  to Base Rate
Loans for such day.

     "CD  Margin"  means a rate per  annum  determined  in  accordance  with the
Pricing Schedule.

     The "Adjusted CD Rate"  applicable to any Interest  Period means a rate per
annum determined pursuant to the following formula:

                               [ CDBR                  ]*
             ACDR   =  [ ---------- ]  + AR
                               [ 1.00 - DRP ]

             ACDR   =  Adjusted CD Rate
             CDBR   =  CD Base Rate
                  DRP   =  Domestic Reserve Percentage
                  AR    =  Assessment Rate

         ----------
         *  The amount in brackets being rounded upward, if
         necessary, to the next higher 1/100 of 1%

     The "CD  Base  Rate"  applicable  to any  Interest  Period  is the  rate of
interest  determined  by  the  Agent  to be  the  average  (rounded  upward,  if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum bid
at 10:00 A.M. (New York City time) (or as soon thereafter as practicable) on the
first day of such Interest Period by two or more New York certificate of deposit
dealers of

                                       22

<PAGE>

recognized  standing for the purchase at face value from each CD Reference  Bank
of its  certificates of deposit in an amount  comparable to the principal amount
of the CD Loan of such CD Reference  Bank to which such Interest  Period applies
and having a maturity comparable to such Interest Period.

     "Domestic Reserve Percentage" means for any day that percentage  (expressed
as a  decimal)  which is in effect on such day,  as  prescribed  by the Board of
Governors of the Federal  Reserve System (or any successor) for  determining the
maximum   reserve   requirement   (including   without   limitation  any  basic,
supplemental  or emergency  reserves)  for a member bank of the Federal  Reserve
System in New York City with deposits  exceeding five billion dollars in respect
of new non-personal  time deposits in dollars in New York City having a maturity
comparable to the related  Interest Period and in an amount of $100,000 or more.
The Adjusted CD Rate shall be adjusted  automatically on and as of the effective
date of any change in the Domestic Reserve Percentage.

     "Assessment Rate" means for any day the annual assessment rate in effect on
such day which is payable by a member of the Bank Insurance  Fund  classified as
adequately  capitalized  and within  supervisory  subgroup  "A" (or a comparable
successor  assessment risk  classification)  within the meaning of 12 C.F.R. ss.
327.3(e)  (or  any  successor   provision)  to  the  Federal  Deposit  Insurance
Corporation  (or any successor)  for such  Corporation's  (or such  successor's)
insuring time deposits at offices of such institution in the United States.  The
Adjusted CD Rate shall be adjusted automatically on and as of the effective date
of any change in the Assessment Rate.

     (c) Each Euro-Dollar Loan shall bear interest on the outstanding  principal
amount thereof, for each day during the Interest Period applicable thereto, at a
rate per annum equal to the sum of the Euro-Dollar  Margin for such day plus the
applicable  London  Interbank  Offered Rate applicable to such Interest  Period.
Such interest shall be payable for each Interest  Period on the last day thereof
and, if such Interest Period is longer than three months,  at intervals of three
months after the first day thereof.

     "Euro-Dollar  Margin" means a rate per annum  determined in accordance with
the Pricing Schedule.

     The "London Interbank Offered Rate" applicable to any Interest Period means
the average (rounded upward, if necessary, to the next higher 1/16 of 1%) of the
respective  rates per annum at which  deposits in dollars are offered to each of
the Euro-Dollar Reference Banks in the London

                                       23

<PAGE>

interbank  market at  approximately  11:00 A.M.  (London  time) two  Euro-Dollar
Business  Days  before  the  first  day of such  Interest  Period  in an  amount
approximately  equal to the  principal  amount of the  Euro-Dollar  Loan of such
Euro-Dollar  Reference Bank to which such Interest  Period is to apply and for a
period of time comparable to such Interest Period.
     (d) Any overdue principal of or interest on any Euro-Dollar Loan shall bear
interest,  payable  on  demand,  for each day at a rate per  annum  equal to the
higher of (i) the sum of 1% plus the  Euro-Dollar  Margin  for such day plus the
London  Interbank  Offered Rate  applicable to the Interest Period for such Loan
and  (ii)  the sum of 1% plus  the  Euro-  Dollar  Margin  for such day plus the
quotient obtained (rounded upward, if necessary, to the next higher 1/100 of 1%)
by dividing (x) the average  (rounded upward,  if necessary,  to the next higher
1/16 of 1%) of the  respective  rates per  annum at which  one day (or,  if such
amount due remains unpaid more than three  Euro-Dollar  Business Days,  then for
such other  period of time not longer than three months as the Agent may select)
deposits in dollars in an amount approximately equal to such overdue payment due
to each of the  Euro-Dollar  Reference  Banks are  offered  to such  Euro-Dollar
Reference  Bank  in the  London  interbank  market  for  the  applicable  period
determined  as  provided  above  by  (y)  1.00  minus  the  Euro-Dollar  Reserve
Percentage (or, if the  circumstances  described in clause (a) or (b) of Section
8.01  shall  exist,  at a rate  per  annum  equal to the sum of 1% plus the rate
applicable to Base Rate Loans for such day).

     (e) Subject to Section  8.01(a),  each Money  Market  LIBOR Loan shall bear
interest on the outstanding  principal  amount thereof,  for the Interest Period
applicable thereto, at a rate per annum equal to the sum of the London Interbank
Offered Rate for such Interest  Period  (determined  in accordance  with Section
2.07(c)  as if the  related  Money  Market  LIBOR  Borrowing  were  a  Committed
Euro-Dollar  Borrowing)  plus (or minus) the Money Market  Margin  quoted by the
Bank  making  such Loan in  accordance  with  Section  2.03.  Each Money  Market
Absolute  Rate Loan shall bear  interest  on the  outstanding  principal  amount
thereof,  for the Interest Period applicable  thereto, at a rate per annum equal
to the  Money  Market  Absolute  Rate  quoted  by the Bank  making  such Loan in
accordance  with Section 2.03.  Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months,  at intervals  of three months after the first day thereof.  Any overdue
principal of or interest on any Money Market Loan shall bear  interest,  payable
on demand,  for each day until  paid at a rate per annum  equal to the sum of 1%
plus the Base Rate for such day.

                                       24

<PAGE>

     (f) The Agent shall  determine  each interest rate  applicable to the Loans
hereunder.  The  Agent  shall  give  prompt  notice  to  the  Borrower  and  the
participating   Banks  of  each  rate  of  interest  so   determined,   and  its
determination thereof shall be conclusive in the absence of manifest error.

     (g)  Each  Reference  Bank  agrees  to use  its  best  efforts  to  furnish
quotations to the Agent as contemplated  hereby.  If any Reference Bank does not
furnish a timely quotation, the Agent shall determine the relevant interest rate
on the basis of the quotation or quotations furnished by the remaining Reference
Bank or Banks or, if none of such quotations is available on a timely basis, the
provisions of Section 8.01 shall apply.

     SECTION  2.08.  Facility  Fees.  The Company shall pay to the Agent for the
account of the Banks ratably a facility fee at the Facility Fee Rate (determined
daily in accordance with the Pricing  Schedule).  Such facility fee shall accrue
(i) from and including the Effective Date to but excluding the Termination  Date
(or earlier date of termination of the  Commitments in their  entirety),  on the
daily aggregate amount of the Commitments (whether used or unused) and (ii) from
and including the  Termination  Date or such earlier date of  termination to but
excluding  the date the Loans  shall be repaid in their  entirety,  on the daily
aggregate  outstanding  principal  amount of the Loans.  Accrued fees under this
Section shall be payable  quarterly on each March 31, June 30,  September 30 and
December  31 and  upon  the  date of  termination  of the  Commitments  in their
entirety (and, if later, the date the Loans shall be repaid in their entirety).

     SECTION 2.09. Optional Termination or Reduction of Commitments. The Company
may,  upon at least  three  Domestic  Business  Days'  notice to the Agent,  (i)
terminate the  Commitments at any time, if no Loans are outstanding at such time
or (ii) ratably reduce from time to time by an aggregate amount of $1,000,000 or
any larger multiple  thereof,  the aggregate amount of the Commitments in excess
of the aggregate outstanding principal amount of the Loans.
 
     SECTION 2.10. Scheduled  Termination of Commitments.  The Commitments shall
terminate on the Termination Date, and any Loans then outstanding (together with
accrued interest thereon) shall be due and payable on such date.

     SECTION 2.11. Optional Prepayments.  (a) Either Borrower may, upon at least
one Domestic Business Day's notice to the Agent,  prepay any Base Rate Borrowing
(or any

                                       25

<PAGE>

Money Market  Borrowing  bearing  interest at the Base Rate  pursuant to Section
8.01(a))  in whole at any time,  or from time to time in part in amounts  which,
when added to the principal amounts of other Loans to it maturing and being paid
at the time of such prepayment, equals in the aggregate $1,000,000 or any larger
multiple  thereof,  by paying the principal  amount to be prepaid  together with
accrued  interest  thereon  to  the  date  of  prepayment.  Each  such  optional
prepayment  shall be applied to prepay  ratably the Loans of the  several  Banks
included in such Borrowing.

     (b) Either Borrower may, upon at least three Domestic Business Days' notice
to the Agent, in the case of a CD Borrowing,  or upon at least three Euro-Dollar
Business  Days'  notice to the Agent,  in the case of a  Euro-Dollar  Borrowing,
subject to Section 2.14,  prepay any such Borrowing by it in whole or in part in
amounts  aggregating  $1,000,000 or any larger multiple thereof, on any Domestic
Business Day, in the case of a CD Borrowing, or any Euro-Dollar Business Day, in
the case of a  Euro-Dollar  Borrowing,  by  paying  the  principal  amount to be
prepaid together with accrued  interest thereon to the date of prepayment.  Each
such optional  prepayment  shall be applied to prepay ratably the outstanding CD
Loans or  Euro-Dollar  Loans of the several  Banks  included in such  Borrowing,
subject to Article VIII.

     (c) Except as provided in Section 2.11(a),  neither Borrower may prepay all
or any  portion of the  principal  amount of any Money  Market Loan prior to the
maturity thereof.

     (d) Upon receipt of a notice of prepayment  pursuant to this  Section,  the
Agent shall promptly notify each Bank of the contents thereof and of such Bank's
ratable share (if any) of such  prepayment  and such notice shall not thereafter
be revocable by the Borrower.

     SECTION 2.12. Change of Control. If a Change of Control shall occur (i) the
Company  will,  within ten days  after the  occurrence  thereof,  give each Bank
notice  thereof  and  shall   describe  in  reasonable   detail  the  facts  and
circumstances  giving  rise  thereto  and (ii) each Bank may, at any time at its
option by notice to the  Borrowers  and the Agent  given not later  than 60 days
after  such  Change of  Control,  (x)  terminate  its  Commitment,  which  shall
thereupon be terminated,  and (y) by three Domestic Business Days' notice to the
Borrowers  and the Agent  declare the Notes held by it  (together  with  accrued
interest thereon) and any other amounts payable hereunder for its account to be,
and such Notes and such other amounts shall  thereupon  become,  immediately due
and payable without presentment, demand,

                                       26

<PAGE>

protest  or  othe  notice of any kind, all  of  which  are  hereby waived by the
Borrowers.

     SECTION 2.13.  General  Provisions as to Payments.  (a) The Borrowers shall
make each  payment  of  principal  of,  and  interest  on, the Loans and of fees
hereunder,  not later than 12:00 Noon (New York City time) on the date when due,
in Federal or other funds  immediately  available in New York City, to the Agent
at its address referred to in Section 10.01. The Agent will promptly  distribute
to each Bank its ratable  share of each such  payment  received by the Agent for
the account of the Banks.  Whenever any payment of principal of, or interest on,
the  Domestic  Loans or of fees  shall be due on a day  which is not a  Domestic
Business  Day,  the date for  payment  thereof  shall  be  extended  to the next
succeeding  Domestic  Business  Day.  Whenever any payment of  principal  of, or
interest  on,  the  Euro-Dollar  Loans  shall  be  due on a day  which  is not a
Euro-Dollar  Business Day, the date for payment thereof shall be extended to the
next succeeding  Euro-Dollar  Business Day unless such Euro-Dollar  Business Day
falls in another  calendar  month,  in which case the date for  payment  thereof
shall be the next preceding  Euro-Dollar  Business Day.  Whenever any payment of
principal of, or interest on, the Money Market Loans shall be due on a day which
is not a  Euro-Dollar  Business  Day,  the date  for  payment  thereof  shall be
extended to the next succeeding Euro-Dollar Business Day. In any case where, and
for so long  as,  the date for any  payment  of  principal  by  either  Borrower
hereunder is extended by operation of law or otherwise,  interest  thereon shall
be payable for such extended  time and the affected  payment shall not be deemed
past due if the  payment  date is not  extended  as a result  of any  action  or
failure to act by such Borrower.

     (b) Unless the Agent shall have  received  notice from a Borrower  prior to
the date on which any payment is due from such  Borrower to the Banks  hereunder
that such Borrower will not make such payment in full, the Agent may assume that
such  Borrower  has made such  payment in full to the Agent on such date and the
Agent may, in reliance upon such  assumption,  cause to be  distributed  to each
Bank on such due date an amount  equal to the amount then due such Bank.  If and
to the extent that such Borrower shall not have so made such payment,  each Bank
shall repay to the Agent  forthwith  on demand such amount  distributed  to such
Bank together with interest  thereon,  for each day from the date such amount is
distributed  to such Bank  until the date such Bank  repays  such  amount to the
Agent, at the Federal Funds Rate.

     SECTION 2.14.  Funding Losses. If a Borrower makes any payment of principal
with respect to any Fixed

                                       27

<PAGE>

Rate Loan  (pursuant  to Section  2.11(b),  Article VI or VIII) on any day other
than the last day of the Interest Period  applicable  thereto,  or the end of an
applicable  period fixed pursuant to Section 2.07(d),  or if a Borrower fails to
borrow or prepay any Fixed Rate Loans after notice has been given to any Bank in
accordance  with Section  2.04(a) or 2.11(d),  the Company shall  reimburse each
Bank within 15 days after demand for any resulting  loss or expense  incurred by
it (or by an existing or contractually  committed prospective Participant in the
related Loan),  including  (without  limitation) any loss incurred in obtaining,
liquidating  or employing  deposits from third  parties,  but excluding  loss of
margin  for the  period  after any such  payment or failure to borrow or prepay,
provided that such Bank shall have  delivered to the Company a certificate as to
the  amount of such loss or  expense,  setting  forth in  reasonable  detail the
calculation  thereof,  which  certificate  shall be presumed  correct unless and
until it is shown to be in error.

     SECTION 2.15. Computation of Interest and Fees. Interest based on the Prime
Rate hereunder shall be computed on the basis of a year of 365 days (or 366 days
in a leap year) and paid for the actual  number of days elapsed  (including  the
first day but  excluding  the last day).  All other  interest and facility  fees
shall be  computed  on the  basis of a year of 360 days and paid for the  actual
number of days elapsed (including the first day but excluding the last day).

     SECTION 2.16.  Regulation D Compensation.  (a) Each Bank may require either
Borrower  to pay,  contemporaneously  with each  payment  of  interest  thereon,
additional  interest on each Euro-Dollar Loan of such Bank to such Borrower at a
rate per annum  equal to the excess of (i)(A) the  applicable  London  Interbank
Offered Rate (or other base rate determined pursuant to Section 2.07(d)) divided
by (B) one minus the Euro-Dollar Reserve Percentage over (ii) the rate specified
in clause  (i)(A).  Any Bank  wishing  to  require  payment  of such  additional
interest  (x) shall so notify such  Borrower  and the Agent,  in which case such
additional interest on the Euro-Dollar Loans of such Bank to such Borrower shall
be payable to such Bank at the place  indicated  in such notice with  respect to
each Interest Period  commencing at least four  Euro-Dollar  Business Days after
the giving of such  notice and (y) shall  notify  such  Borrower  at least three
Euro-Dollar  Business  Days  prior to each  date on which  interest  is  payable
thereon of the amount then due it under this  Section.  Any Bank which has given
notice under  clause (x) above that such  additional  interest is payable  shall
notify such Borrower and the Agent, for so long as such additional interest is

                                       28

<PAGE>

payable,  annually,  not later  than  each  January  15th  that such  additional
interest is payable,  and, as soon as practicable after such additional interest
has  ceased to be  payable,  that it is no longer  payable.  In the event a Bank
shall fail to notify the  Borrowers  and the Agent  annually  of the  continuing
requirements for such additional  interest by the applicable  January 15th, such
Bank shall not be entitled to additional  interest  until such Bank has provided
the notice required by (x) above.

     (b) "Euro-Dollar  Reserve  Percentage"  means for any day for any Bank that
percentage  (expressed  as a  decimal)  which  is in  effect  on  such  day,  as
prescribed  by the Board of  Governors  of the  Federal  Reserve  System (or any
successor) for  determining the effective  reserve  requirement for such Bank as
determined in good faith by such Bank in respect of  "Eurocurrency  liabilities"
(or in respect of any other category of liabilities  which includes  deposits by
reference to which the interest rate on  Euro-Dollar  Loans is determined or any
category of  extensions  of credit or other  assets  which  includes  loans by a
non-United States office of any Bank to United States residents).

     SECTION  2.17.  Maximum  Interest  Rate.  (a)  Nothing  contained  in  this
Agreement or the Notes shall require  either  Borrower to pay interest at a rate
exceeding the maximum rate permitted by applicable law.

     (b) If the amount of interest payable by either Borrower for the account of
any Bank on any interest  payment date in respect of the  immediately  preceding
interest computation period, computed pursuant to Section 2.07, would exceed the
maximum  amount  permitted  by  applicable  law to be charged by such Bank,  the
amount of interest  payable by such  Borrower  for its account on such  interest
payment date shall be automatically reduced to such maximum permissible amount.

     (c) If the amount of interest payable by either Borrower for the account of
any Bank in respect of any interest  computation  period is reduced  pursuant to
clause (b) of this Section and the amount of interest payable by either Borrower
for the account of such Bank in respect of any subsequent  interest  computation
period, computed pursuant to Section 2.07, would be less than the maximum amount
permitted  by  applicable  law to be charged  by such  Bank,  then the amount of
interest  payable  for  its  account  in  respect  of such  subsequent  interest
computation period shall be automatically  increased to such maximum permissible
amount;  provided that at no time shall the aggregate  amount by which  interest
paid by both Borrowers for the account of any Bank has been  increased  pursuant
to this clause (c) exceed the aggregate amount by which interest paid by both

                                       29

<PAGE>

Borrowers for its account has theretofore been reduced pursuant to clause (b) of
this Section.

                                   ARTICLE III

                                   CONDITIONS

     SECTION 3.01.  Effectiveness.  This Agreement shall become effective on the
date that each of the following  conditions shall have been satisfied (or waived
in accordance with Section 10.05):

                  (a) receipt by the Agent of counterparts hereof signed by each
         of the Company, Credit Corporation, the Banks and the Agent (or, in the
         case of any party as to which an  executed  counterpart  shall not have
         been  received,  receipt  by the  Agent in form  satisfactory  to it of
         telegraphic,  telex or other  written  confirmation  from such party of
         execution of a counterpart hereof by such party);

                  (b)  receipt by the Agent for the account of each Bank of duly
         executed Notes of the Company and Credit Corporation dated on or before
         the Effective Date complying with the provisions of Section 2.05;

                  (c) receipt by the Agent of an opinion of the General  Counsel
         of the  Company,  substantially  in the form of  Exhibit  E hereto  and
         covering  such  additional   matters   relating  to  the   transactions
         contemplated hereby as the Required Banks may reasonably request;

                  (d)  receipt  by the  Agent  of an  opinion  of  Davis  Polk &
         Wardwell,  special counsel for the Agent,  substantially in the form of
         Exhibit F hereto and covering such additional  matters  relating to the
         transactions  contemplated  hereby as the Required Banks may reasonably
         request;

                  (e) receipt by the Agent of evidence satisfactory to it of the
         payment of all amounts payable under the Existing Credit Agreement; and

                  (f) receipt by the Agent of all  documents  it may  reasonably
         request   relating  to  the   existence   of  the  Company  and  Credit
         Corporation,  the  corporate  authority  for and the  validity  of this
         Agreement and the Notes, and any other matters relevant hereto,  all in
         form and substance satisfactory to the Agent;

                                       30

<PAGE>

provided  that this  Agreement  shall not become  effective or be binding on any
party hereto unless all of the foregoing conditions are satisfied not later than
August 31, 1994.  The Agent shall  promptly  notify the Company and the Banks of
the  Effective  Date,  and such notice  shall be  conclusive  and binding on all
parties hereto.  The Banks that are parties to the Existing Credit Agreement and
each of the  Borrowers  agree that the  commitments  under the  Existing  Credit
Agreement shall terminate in their entirety  simultaneously  with and subject to
the effectiveness of this Agreement and that the Borrowers shall be obligated to
pay the accrued  commitment  and facility  fees  thereunder to but excluding the
date of such effectiveness.

     SECTION 3.02. Borrowings.  The obligation of any Bank to make a Loan on the
occasion  of any  Borrowing  is subject  to the  satisfaction  of the  following
conditions:

                  (a)  receipt by the Agent of a Notice of Borrowing as required
         by Section 2.02 or 2.03, as the case may be;

                  (b) the fact  that,  immediately  after  such  Borrowing,  the
         aggregate outstanding principal amount of the Loans will not exceed the
         aggregate amount of the Commitments;

                  (c) the fact that,  immediately  after such Borrowing,  (i) in
         the case of a Refunding Borrowing,  no Event of Default and (ii) in the
         case of any other  Borrowing,  no Default  shall have  occurred  and be
         continuing;

                  (d) the fact that the  representations  and  warranties of the
         Company contained in this Agreement (except, in the case of a Refunding
         Borrowing, the representations and warranties set forth in Section 4.05
         as to any matter which has theretofore been disclosed in writing by the
         Company  to the  Banks)  shall  be true  on and as of the  date of such
         Borrowing; and

                  (e) the fact that,  immediately  after such Borrowing,  (i) in
         the case of a Refunding Borrowing,  Adjusted  Consolidated Tangible Net
         Worth  and  (ii)  in the  case  of any  other  Borrowing,  Consolidated
         Tangible Net Worth shall be greater
         than $800,000,000.

     Each  Borrowing  hereunder  shall  be  deemed  to be a  representation  and
warranty by the Borrower on the date of

                                       31

<PAGE>

such  Borrowing as to the facts  specified  in clauses (b),  (c), (d) and (e) of
this Section.

                                   ARTICLE IV

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

                    The Company represents and warrants that:

     SECTION 4.01. Corporate Existence and Power. Each of the Company and Credit
Corporation is a corporation  duly  incorporated,  validly  existing and in good
standing  under  the  laws of  Delaware,  and has all  corporate  power  and all
material governmental licenses, authorizations,  consents and approvals required
to  carry  on its  business  as now  conducted  which,  if not  obtained,  could
reasonably  be expected  to have a material  adverse  effect on the  business or
operations of the Company and its Subsidiaries considered as a whole.

     SECTION 4.02. Corporate and Governmental  Authorization;  No Contravention.
The execution, delivery and performance by the Company and Credit Corporation of
this Agreement and the Notes are within such Borrower's  corporate powers,  have
been duly authorized by all necessary  corporate action,  require no approval of
or filing with any governmental  body,  agency or official and do not contravene
or constitute a default  under any provision of applicable  law or regulation or
of the  certificate  of  incorporation  or  by-laws of such  Borrower  or of any
agreement,  judgment, injunction, order, decree or other instrument binding upon
such Borrower or result in the creation or imposition of any mortgage,  security
interest or other lien or  encumbrance  on any asset of such  Borrower or any of
its Subsidiaries.

     SECTION  4.03.  Binding  Effect.  This  Agreement  constitutes  a valid and
binding agreement of each of the Company and Credit  Corporation,  and each Note
of each Borrower, when executed and delivered in accordance with this Agreement,
will  constitute a valid and binding  obligation of such Borrower,  in each case
enforceable in accordance with its terms.

     SECTION 4.04. Financial Information.  The consolidated balance sheet of the
Company  and its  Consolidated  Subsidiaries  as of  December  31,  1993 and the
related consolidated  statements of income, retained earnings and cash flows for
the year then ended,  reported on by Arthur  Andersen & Co. and set forth in the
Company's 1993 Annual Report,  a copy of which has been delivered to each of the
Banks, fairly present, in conformity with generally

                                       32

<PAGE>

accepted  accounting  principles,  the  consolidated  financial  position of the
Company and its Consolidated Subsidiaries as of such date and their consolidated
results of operations and cash flows for such year.

     SECTION 4.05. Litigation.  Except as set forth in the Company's 1993 Annual
Report,  there is no action,  suit or proceeding pending, or to the knowledge of
the  Company  threatened,  against  or  affecting  the  Company  or  any  of its
Subsidiaries  before any court or arbitrator or any governmental body, agency or
official, which involves any substantial risk of an adverse decision which would
result in any material  adverse effect on the business,  consolidated  financial
position  or  consolidated   results  of  operations  of  the  Company  and  its
Consolidated  Subsidiaries considered as a whole, or which involves any material
risk of an adverse  decision  which would draw into question the validity of the
obligations  of  either  Borrower  under  this  Agreement  or the  Notes of such
Borrower.

     SECTION 4.06. Compliance with ERISA.

     (a) Neither the Company nor any Related  Person has failed to comply in any
material  respect  with the  applicable  provisions  of ERISA  and the  Internal
Revenue Code and the  regulations  promulgated  thereunder  (including,  without
limitation,  sections  4068,  4069 and 4212 of ERISA),  where such failure could
reasonably  be  expected  to be  materially  adverse  to  the  Company  and  its
Subsidiaries taken as a whole.

     (b) Other than premiums to the PBGC due in the normal course,  no liability
to the PBGC  (with  respect  to which  the  Company  or any  Related  Person  is
delinquent)  has been  incurred  and remains  unsatisfied  or is expected by the
Company to be  incurred  with  respect to any Plan by the Company or any Related
Person  which  is or  would  be  materially  adverse  to  the  Company  and  its
Subsidiaries taken as a whole.

     (c) Neither the Company nor any Related  Person is obligated to  contribute
to, or has incurred a withdrawal  liability  with respect to, any  Multiemployer
Plan in an amount  that  would be  materially  adverse  to the  Company  and its
Subsidiaries taken as a whole.

     (d) Full  payment  has been made of all  amounts  that the  Company  or any
Related  Person  is  required  under  the  terms  of each  Plan to have  paid as
contributions  to such Plan as of the last day of the most recent fiscal year of
such Plan  ended  prior to the date  hereof  (or will be made  within the period
described in Section 404 of the Internal

                                       33

<PAGE>

Revenue Code) and no accumulated  funding  deficiency (as defined in Section 302
of ERISA and Section 412 of the Internal  Revenue  Code),  whether or not waived
exists  with  respect  to any Plan.  Each Plan  satisfies  the  minimum  funding
standard of Section 412 of the Internal Revenue Code.

     (e) The amount of Benefit Liabilities under each Plan, determined as of the
end  of the  Company's  most  recently  ended  fiscal  year  (on  the  basis  of
assumptions  prescribed  by the PBGC for  purposes of Section 4044 of ERISA) did
not exceed the current  value of the assets of such Plans  determined as of such
date in an amount that,  individually  or in the aggregate  with such amount for
all Plans, exceeds $25,000,000.

     SECTION 4.07.  Environmental  Matters. The Company and each of its Material
Subsidiaries is in compliance  with, or has obtained  waivers or variances from,
all  applicable   requirements  of  all  federal,   state,   local  and  foreign
governmental  authorities with respect to environmental  protection,  including,
without  limitation,  regulations  relating to pollution control or establishing
quality criteria and standards for air, water and land  ("Environmental  Laws"),
in all jurisdictions  where such Persons are presently doing business and which,
if not  obtained  or  complied  with,  could  reasonably  be  expected to have a
material  adverse  effect on the business or  operations  of the Company and its
Subsidiaries considered as a whole.

     SECTION  4.08.  Taxes.  United  States  Federal  income tax  returns of the
Company and its Subsidiaries  have been examined through the year ended December
31, 1989. The Company and its Subsidiaries  have filed all United States Federal
income tax returns and all other  material tax returns  which are required to be
filed by them and have paid all taxes due  pursuant to such  returns or pursuant
to any  assessment  received by the Company or any of its  Subsidiaries,  except
such  taxes or  assessments,  if any,  as are being  contested  in good faith by
appropriate proceedings.  The charges, accruals and reserves on the books of the
Company  and its  Subsidiaries  in respect of taxes are,  in the  opinion of the
Company, adequate.

     SECTION  4.09.  Subsidiaries.  Each  of  the  Material  Subsidiaries  is  a
corporation duly  incorporated,  validly existing and in good standing under the
laws of its jurisdiction of incorporation, and has all corporate powers required
to carry on its business as now  conducted.  Each  Material  Subsidiary  has all
governmental licenses, authorizations,  consents and approvals required to carry
on its business as now conducted and which, if not obtained,

                                       34

<PAGE>

could  reasonably be expected to have a material  adverse effect on the business
or operations of the Company and its Subsidiaries considered as a whole.

                                    ARTICLE V

                                    COVENANTS

     The  Company  covenants  and  agrees  that,  so  long as any  Bank  has any
Commitment hereunder or any amount payable under any Note remains unpaid:

     SECTION 5.01. Information. The Company will deliver to each of the Banks:

                  (a) to the extent not  already  delivered  pursuant to another
         clause of this  Section  5.01,  as soon as  available  and in any event
         within 120 days after the end of each  fiscal  year of the  Company,  a
         consolidated   balance  sheet  of  the  Company  and  its  Consolidated
         Subsidiaries  as of  the  end of  such  fiscal  year  and  the  related
         consolidated statements of income, retained earnings and cash flows for
         such fiscal year,  setting forth in each case in  comparative  form the
         figures  for the  previous  fiscal  year,  all  reported  on by  Arthur
         Andersen & Co. or other  independent  public  accountants of nationally
         recognized  standing and an  unaudited  consolidated  balance  sheet of
         Credit  Corporation and its Consolidated  Subsidiaries as of the end of
         such  fiscal year and the related  consolidated  statements  of income,
         retained earnings and cash flows for such fiscal year, setting forth in
         the case of such  statements  of income and cash  flows in  comparative
         form the figures for the previous  fiscal year,  accompanied by (x) the
         report  thereon  of  independent  public  accountants  or (y)  if  such
         financial  statements  are not  otherwise  reported  on by  independent
         public  accountants,  a certificate of the chief accounting  officer of
         Credit  Corporation as to fairness of presentation,  generally accepted
         accounting principles and consistency;

                  (b) to the extent not  already  delivered  pursuant to another
         clause of this  Section  5.01,  as soon as  available  and in any event
         within 60 days  after the end of each of the first  three  quarters  of
         each fiscal year of the Company,  (x) a  consolidated  balance sheet of
         the  Company  and  its Consolidated Subsidiaries  as of the end of such

                                       35

<PAGE>

         quarter,  (y) the related  consolidated  statements  of income for such
         quarter and for the portion of the  Company's  fiscal year ended at the
         end of such quarter and (z) the related consolidated  statement of cash
         flows for the portion of the Company's  fiscal year ended at the end of
         such quarter,  setting  forth in the case of such  statements of income
         and cash flows in  comparative  form the figures for the  corresponding
         quarter and the corresponding  portion of the Company's previous fiscal
         year,  all certified  (subject to normal  year-end  adjustments)  as to
         fairness of presentation,  generally accepted accounting principles and
         consistency by the chief accounting officer of the Company;

                  (c) simultaneously  with the delivery of each set of financial
         statements  referred  to in  clauses  (a) and (b) above or  clause  (g)
         below,  a certificate  of the chief  accounting  officer of the Company
         stating  whether to the knowledge of such officer,  there exists on the
         date of such  certificate  any Default and, if any Default then exists,
         setting  forth the details  thereof and the action which the Company is
         taking or proposes to take with respect thereto;

                  (d)  simultaneously  with the  delivery of each set of audited
         year-end  financial  statements  referred  to in clauses  (a) or (g), a
         statement substantially in the form attached hereto as Exhibit G of the
         firm  of  independent   public   accountants  which  reported  on  such
         statements  stating  whether  anything  has come to their  attention to
         cause them to believe that there existed on the date of such statements
         any Default;

                  (e) forthwith upon any executive  officer  (meaning any member
         of  the  executive  management  committee,  the  treasurer,  the  chief
         financial officer, the general counsel or the chief accounting officer)
         of the Company obtaining  knowledge of the occurrence of any Default, a
         certificate  of the chief  accounting  officer of the  Company  setting
         forth the details thereof and the action which the Company is taking or
         proposes to take with respect thereto;

                  (f) promptly upon the mailing  thereof to the  shareholders of
         the Company generally, copies of

                                       36

<PAGE>

         all financial statements, reports and proxy statements so mailed;
         
                  (g)  promptly  upon  the  filing  thereof,   a  copy  of  each
         registration  statement  (other  than  the  exhibits  thereto  and  any
         registration  statements  on  Form  S-8 or its  equivalent)  which  the
         Company shall have filed with the Securities  and Exchange  Commission,
         and,  within 15 days after the filing  thereof,  a copy of each annual,
         quarterly or other report (other than the exhibits  thereto)  which the
         Company shall have filed with the Securities and Exchange Commission;

                  (h) if and when the Company or any Related Person (i) gives or
         is required to give  notice to the PBGC of any  "reportable  event" (as
         defined in Section  4043 of ERISA) with respect to any Plan which might
         constitute  grounds  for a  termination  of such Plan under Title IV of
         ERISA, or knows that the plan administrator of any Plan has given or is
         required to give  notice of any such  reportable  event,  a copy of the
         notice of such  reportable  event  given or required to be given to the
         PBGC; (ii) receives notice of complete or partial withdrawal  liability
         under  Title IV of ERISA or notice  that any  Multiemployer  Plan is in
         reorganization,  is  insolvent or has been  terminated,  a copy of such
         notice;  or (iii) receives notice from the PBGC under Title IV of ERISA
         of an intent to terminate,  impose  liability  (other than for premiums
         under  Section  4007 of ERISA) in  respect  of or  appoint a trustee to
         administer any Plan, a copy of such notice; and

                  (i) from time to time,  upon  receiving  from the  Banks  such
         assurances  of  confidential  treatment  as the Company may  reasonably
         request,  such additional  information regarding the financial position
         or business  of the  Company as the Agent,  at the request of any Bank,
         may reasonably request.

     SECTION 5.02.  Payment of Taxes.  The Company  covenants  that it will, and
will cause each of its Subsidiaries to, pay all material taxes,  assessments and
other governmental charges imposed upon it or any of its Properties or assets or
in  respect of any of its  franchises,  business,  income or profits  before any
penalty or interest accrues thereon, and all material claims (including, without
limitation,  claims for labor, services,  materials and supplies) for sums which
have become due and payable and

                                       37

<PAGE>

which by law have or might become a Lien upon any of its  Properties  or assets,
non-payment  of which could have a material and adverse  effect on the business,
condition  (financial  or  otherwise)  or  operations  of the  Company  and  its
Subsidiaries  taken as a whole or on the  ability of the  Company to comply with
its  obligations  under this Agreement or the Notes,  provided that no such tax,
assessment,  charge or claim  need be paid if being  contested  in good faith by
appropriate proceedings promptly initiated and diligently conducted.

     SECTION  5.03.  Insurance.  The  Company  will  maintain  or  cause  to  be
maintained,  with  financially  sound and  reputable  insurers,  insurance  with
respect to its  Properties  and business and the  Properties and business of its
Subsidiaries  against loss or damage of the kinds customarily insured against by
corporations of established  reputation  engaged in the same or similar business
and  similarly  situated,  of such types and in such amounts as are  customarily
carried  under  similar  circumstances  by such  other  corporations;  provided,
however, that in lieu of any such insurance,  the Company or any such Subsidiary
may  maintain  a system or systems of  self-insurance  which are in accord  with
sound practices of similarly  situated  corporations  of established  reputation
maintaining  such  systems  and  with  respect  to  which  the  Company  or such
Subsidiary  shall  maintain  adequate  insurance  reserves  in  accordance  with
generally accepted accounting  principles and in accordance with sound actuarial
and insurance principles.

     SECTION 5.04.  Conduct of Business and Maintenance of Existence.  Except as
permitted by Section  5.08,  the Company will at all times  preserve and keep in
full force and effect and will cause each  Material  Subsidiary  to preserve and
keep in full force and effect its corporate existence, and rights and franchises
deemed  material to the  Properties,  business,  prospects,  profits,  condition
(financial or otherwise) or operations of the Company and its Subsidiaries taken
as a whole,  except that such rights and franchises and the corporate  existence
of any Material Subsidiary (other than Credit Corporation) may be terminated if,
in the  good-faith  judgment  of the Board of  Directors  of the  Company,  such
termination is in the best interest of the Company and is not disadvantageous to
the Banks.
     SECTION 5.05. Compliance with Laws. The Company will, and will use its best
efforts to cause each Subsidiary to, comply with all applicable  laws, rules and
regulations and orders of any governmental authority,  non-compliance with which
could have a material and adverse effect on the business,  condition  (financial
or otherwise) or operations of the Company and its Subsidiaries taken as a whole
or on

                                       38

<PAGE>

the ability of the Company to comply with its  obligations  under this Agreement
or the Notes.

     SECTION  5.06.  Compliance  with ERISA.  The Company will not, and will not
permit any Subsidiary to (i) engage in any  transaction in connection with which
the  Company  or any  Subsidiary  could be  subject  to  either a civil  penalty
assessed  pursuant to Section  502(i) of ERISA, a tax imposed by Section 4975 of
the Internal  Revenue Code, or a lien pursuant to Section 412(n) of the Internal
Revenue Code, (ii) terminate any Plan in a manner, or take any other action with
respect to any such Plan (including, without limitation, a substantial cessation
of  operations  within the  meaning of Section  4068(f) of ERISA),  which  could
result in any  liability  of the Company or any  Subsidiary  to the PBGC or to a
trustee  appointed  pursuant  to Section  4042(b) or (c) of ERISA,  or incur any
liability to the PBGC on account of a  termination  of a Plan under Section 4064
of ERISA,  (iii) fail to make full payment when due of all amounts which,  under
the provisions of any Plan or Section  412(m) of the Internal  Revenue Code, the
Company or any  Subsidiary  is required to pay as  contributions  thereto,  (iv)
incur any complete or partial withdrawal  liability under Title IV of ERISA with
respect  to any  Multiemployer  Plan,  or (v)  permit to exist  any  accumulated
funding deficiency,  whether or not waived, with respect to any Plan, if, in the
aggregate,  such penalty or tax or such  liability,  or the failure to make such
payment,  or the  existence  of such  deficiency,  as the case  may be,  exceeds
$25,000,000.

     SECTION 5.07.  Negative  Pledge.  Neither the Company nor any  Consolidated
Subsidiary will create,  assume or suffer to exist any Lien securing Debt on any
Restricted Property now owned or hereafter acquired by it, except:

                  (a)  Liens existing on the date of this Agreement;

                  (b) any Lien existing on any asset of any  corporation  at the
         time such corporation becomes a Consolidated Subsidiary and not created
         in  contemplation  of such event and which does not extend to any other
         assets of the Company or its Consolidated Subsidiary;

                  (c) any Lien on any asset  securing  Debt  incurred or assumed
         for the purpose of financing  all or any part of the cost of acquiring,
         constructing or improving such asset,  provided that such Lien attaches
         to  such  asset  concurrently  with  or  within  24  months  after  the
         acquisition or completion of construction or improvement  thereof,  and
         provided further that the Debt

                                       39

<PAGE>

         secured  by  such  Lien   shall  not  exceed  the  cost  of  acquiring,
         constructing or improving such asset;

                  (d) any Lien on any asset of any  corporation  existing at the
         time  such  corporation  is  merged  or  consolidated  with or into the
         Company or a Consolidated  Subsidiary and not created in  contemplation
         of such  event and  which  does not  extend to any other  assets of the
         Company or its Consolidated Subsidiaries;

                  (e) any Lien  existing on any asset  prior to the  acquisition
         thereof by the Company or a Consolidated  Subsidiary and not created in
         contemplation of such acquisition;

                  (f) any Lien  arising  pursuant  to any  order of  attachment,
         distraint or similar  legal process  arising in  connection  with court
         proceedings  so long as the execution or other  enforcement  thereof is
         effectively  stayed and the claims secured  thereby are being contested
         in good faith by appropriate proceedings;

                  (g) Liens to secure  indebtedness of the pollution  control or
         industrial revenue bond type and Liens in favor of the United States or
         any state  thereof,  or any  department,  agency,  instrumentality,  or
         political   subdivision  of  any  such  jurisdiction,   to  secure  any
         indebtedness  incurred for the purpose of financing  all or any part of
         the purchase  price or cost of  constructing  or improving the property
         subject thereto;

                  (h)  any  Lien  (including  Liens  in  respect  of  production
         payments)  to  secure  the  payment  of all or any  part of the cost of
         exploration,  drilling,  mining,  or  development of property which had
         prior  to  December   31,  1993,   produced  no  material   volumes  of
         hydrocarbons,  coal, minerals,  timber or other products or by-products
         produced  or  extracted  from  such  property,  provided  that the Debt
         secured by such Lien shall not exceed the cost of exploring,  drilling,
         mining or development of such property;  and provided further that such
         Lien shall not extend to any  property  other than the  property  being
         explored, drilled, mined or developed;

                  (i) Lien  securing  Debt  incurred  by  Kerr-McGee  Oil (U.K.)
         Limited to pay all or any part of the cost of exploration,  drilling or
         development of any North Sea properties  within the territorial  waters
         of the United  Kingdom,  provided  that the Debt  secured by such liens
         shall  not  exceed  the  cost  of  such   exploration,   drilling,   or
         development; and provided further that

                                       40

<PAGE>

         such  Lien  shall  not  extend to any property  other than the property
         being explored, drilled or developed;

                  (j)  any  Lien  arising  out  of the  refinancing,  extension,
         renewal or refunding  of any Debt secured by any Lien  permitted by any
         of the foregoing  clauses of this section,  provided that the amount of
         such Debt is not increased and is not secured by any additional assets;
         and

                  (k) Liens not otherwise  permitted by the foregoing clauses of
         this Section securing Debt in an aggregate principal amount at any time
         outstanding not exceeding 5% of Stockholders' Equity of the Company.

     SECTION 5.08. Consolidations, Mergers and Sales of Assets. The Company will
not be a party  to any  merger  or  consolidation  or sell,  lease or  otherwise
transfer all or substantially all of its Property, provided that the Company may
merge or consolidate  with another  corporation and may sell, lease or otherwise
transfer  all or  substantially  all of its  Property  as an entirety to another
corporation  if (i) the  surviving or acquiring  corporation  (if other than the
Company) (A) is organized  under the laws of the United States or a jurisdiction
thereof  and  (B)  expressly  assumes  the  covenants  and  obligations  in this
Agreement  and (ii)  immediately  after giving  effect to such  transaction,  no
condition  or event  shall  exist  which  constitutes  an Event of  Default  and
Consolidated Tangible Net Worth is not less than $800,000,000.

     SECTION  5.09.  Use of Proceeds.  The proceeds of the Loans made under this
Agreement will be used by the Borrowers for general  corporate  purposes,  which
includes the use by the Borrowers of such proceeds to support the issuance by it
of domestic  commercial paper notes, and will not, in any event, be used for the
purpose,  whether immediate,  incidental or ultimate,  of buying or carrying any
margin stock, within the meaning of Regulation U.
 
     SECTION 5.10.  Transactions with Affiliates.  The Company will not directly
or indirectly  engage in any transaction  (including,  without  limitation,  the
purchase,  sale or exchange of assets or the  rendering of any service) with any
Affiliate,  except in the  ordinary  course of and  pursuant  to the  reasonable
requirements  of the  Company's or such  Affiliate's  business and upon fair and
reasonable  terms  that  are  substantially  the same as  those  which  might be
obtained in an arm's length  transaction  at the time from Persons which are not
such an Affiliate or upon terms which would not materially and adversely  affect
the ability of the Company to comply with its obligations under this Agreement;

                                       41
<PAGE>

provided,  however,  that  taxes  may be  allocated  among the  Company  and its
Affiliates  in any  manner  consistent  with  Section  1552  (or  any  successor
provision) of the Internal Revenue Code and the regulations thereunder,  general
and  administrative  expenses  may  be  allocated  among  the  Company  and  its
Affiliates  in  any  manner  consistent  with  Section  482  (or  any  successor
provision)  of the Internal  Revenue Code and the  regulations  thereunder,  and
interest may be charged or credited to Affiliates in any  reasonable  manner not
inconsistent with the Internal Revenue Code and the regulations thereunder.

     SECTION  5.11.  Ownership  of Credit  Corporation.  The Company will at all
times own,  directly or  indirectly,  all  outstanding  capital  stock of Credit
Corporation, free and clear of any Lien.

     SECTION 5.12. Change in Rating.  Promptly upon becoming aware of any actual
or proposed change in the rating by S&P or Moody's of the Company's  outstanding
senior unsecured long-term debt securities, the Company shall give notice to the
Agent of such actual or proposed change.

                                   ARTICLE VI

                                    DEFAULTS

     SECTION 6.01.  Events of Default.  If one or more of the  following  events
("Events of Default") shall have occurred and be continuing:

                  (a) a Borrower shall fail to pay when due any principal of any
         Loan or, within five days of the due date thereof,  any interest on any
         Loan, any fees or any other amount payable hereunder;

                  (b) the Company  shall fail to observe or perform any covenant
         contained in Sections 5.07 through 5.11 inclusive;

                  (c) the Company  shall fail to observe or perform any covenant
         or agreement  contained in this Agreement  (other than those covered by
         clauses  (a) or (b) above) for 30 days after  notice  thereof  has been
         given in  accordance  with Section 10.01 to the Company by the Agent at
         the request of any Bank;

                  (d) any representation,  warranty,  certification or statement
         made or deemed,  pursuant to the terms hereof, to have been made by the
         Company in this Agreement or in any certificate, financial statement or

                                       42
<PAGE>

         other notice  delivered  pursuant to this Agreement shall prove to have
         been incorrect in any material respect when made or deemed to have been
         made;

                  (e) the  Company  or any  Subsidiary  shall  fail to make  any
         payment in respect of any Material  Financial  Obligations  when due or
         within any applicable grace period;

                  (f) any event or  condition  (other than an event or condition
         which  renders it  unlawful  for any Person to make,  maintain  or fund
         extensions of credit  comprising any Debt described in this  subsection
         (f)) shall occur which results in the  acceleration  of the maturity of
         any Debt (which  term  shall,  for  purposes  of this  subsection  (f),
         exclude (1) clause (vi) of the  definition of Debt set forth in Section
         1.01 and (2) Debt of any Person that is not a Subsidiary of the Company
         and which is  Guaranteed  by the  Company or a  Subsidiary,  so long as
         neither the  Company nor such  Subsidiary  is in default  with  respect
         thereto)  of the  Company  or any  Subsidiary  greater  than  the  Debt
         Acceleration Threshold in aggregate principal amount;

                  (g) the Company or any Material  Subsidiary  shall  commence a
         voluntary case or other proceeding seeking liquidation,  reorganization
         or  other  relief  with  respect  to  itself  or its  debts  under  any
         bankruptcy,  insolvency or other similar law now or hereafter in effect
         or  seeking  the  appointment  of  a  trustee,  receiver,   liquidator,
         custodian or other similar  official of it or any  substantial  part of
         its Property, or shall consent to any such relief or to the appointment
         of or taking  possession by any such official in an involuntary case or
         other  proceeding  commenced  against  it,  or  shall  make  a  general
         assignment for the benefit of creditors, or shall fail generally to pay
         its debts as they  become due,  or shall take any  corporate  action to
         authorize any of the foregoing;

                  (h) an involuntary case or other proceeding shall be commenced
         against the Company or any  Material  Subsidiary  seeking  liquidation,
         reorganization  or other  relief with  respect to it or its debts under
         any  bankruptcy,  insolvency  or other  similar law now or hereafter in
         effect or seeking the appointment of a trustee,  receiver,  liquidator,
         custodian or other similar  official of it or any  substantial  part of
         its  property,  and such  involuntary  case or other  proceeding  shall
         remain  undismissed  and unstayed for a period of 60 days;  or an order
         for relief shall be entered

                                       43
<PAGE>

         against  the  Company or  any Material  Subsidiary  under  the  federal
         bankruptcy laws as now or hereafter in effect;

                  (i) the Company or any Related  Person  shall fail to pay when
         due (and not being  contested  in good  faith)  an  amount  or  amounts
         aggregating  in excess of $5,000,000  which it shall have become liable
         to pay to the PBGC, the Internal  Revenue  Service or the Department of
         Labor or to a Multiemployer  Plan under Title IV of ERISA; or notice of
         intent to terminate a Plan or Plans having  aggregate  Unfunded Benefit
         Liabilities in excess of $50,000,000 (collectively,  a "Material Plan")
         shall be filed  under  Title IV of ERISA by the  Company or any Related
         Person, any plan administrator or any combination of the foregoing;  or
         the  PBGC  shall  institute  proceedings  under  Title  IV of  ERISA to
         terminate,  to impose  liability (other than for premiums under Section
         4007 of ERISA) in respect of or to cause a trustee to be  appointed  to
         administer  any  Material  Plan;  or there  shall  occur a complete  or
         partial  withdrawal  from, or a default,  within the meaning of Section
         4219(c)(5) of ERISA, with respect to, one or more  Multiemployer  Plans
         which would cause the Company or any Related  Person to incur a current
         payment obligation in excess of $50,000,000; or a condition shall exist
         by  reason  of which  the PBGC  would be  entitled  to  obtain a decree
         adjudicating that any Material Plan must be terminated; or

                  (j) a final  judgment  or order  for the  payment  of money in
         excess of $10,000,000  not covered by insurance (as to which  insurance
         coverage  there  is  delivered  to the  Agent  an  opinion  of  counsel
         reasonably satisfactory to the Agent that such coverage applies to such
         judgment  or order and that the  applicable  insurance  carrier has not
         contested the payment thereof) shall be rendered against the Company or
         any  Material  Subsidiary  and such  judgment or order  shall  continue
         unsatisfied and not stayed,  bonded,  vacated or suspended by agreement
         with the beneficiary thereof for a period of 60 days;

then, and in every such event,  the Agent shall (i) if requested by Banks having
more than 50% in aggregate amount of the  Commitments,  by notice to the Company
terminate  the  Commitments  and they  shall  thereupon  terminate,  and (ii) if
requested by Banks holding Notes evidencing more than 50% in aggregate principal
amount of the Loans,  by notice to the Company  declare the Notes (together with
accrued  interest  thereon)  to  be,  and  the  Notes  shall  thereupon  become,
immediately due and payable without presentment, demand,

                                       44
<PAGE>

protest  or other  notice of any kind,  all of which are  hereby  waived by each
Borrower; provided that in the case of any of the Events of Default specified in
clause (g) or (h) above with respect to either  Borrower,  without any notice to
either  Borrower  or any other act by the Agent or the  Banks,  the  Commitments
shall thereupon terminate and the Notes (together with accrued interest thereon)
shall become immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by each Borrower.

     SECTION 6.02. Notice of Default. The Agent shall give notice to the Company
under Section  6.01(c)  promptly  upon being  requested to do so by any Bank and
shall thereupon notify all the Banks thereof.

                                   ARTICLE VII

                                    THE AGENT

     SECTION 7.01. Appointment and Authorization. Each Bank irrevocably appoints
and  authorizes  the Agent to take such  action  as agent on its  behalf  and to
exercise such powers under this  Agreement and the Notes as are delegated to the
Agent by the  terms  hereof or  thereof,  together  with all such  powers as are
reasonably incidental thereto.

     SECTION 7.02.  Agent and  Affiliates.  Morgan Guaranty Trust Company of New
York shall have the same  rights and powers  under this  Agreement  as any other
Bank and may exercise or refrain from  exercising the same as though it were not
the Agent,  and Morgan Guaranty Trust Company of New York and its affiliates may
accept  deposits  from,  lend  money  to,  and  generally  engage in any kind of
business with either  Borrower or any Subsidiary or Affiliate of either Borrower
as if it were not the Agent hereunder.

     SECTION 7.03.  Action by Agent.  The obligations of the Agent hereunder are
only those  expressly set forth herein.  Without  limiting the generality of the
foregoing,  the Agent shall not be  required to take any action with  respect to
any Default, except as expressly provided in Article VI.

     SECTION 7.04.  Consultation with Experts.  The Agent may consult with legal
counsel (who may be counsel for either Borrower), independent public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted  to be taken by it in good faith in  accordance  with the advice of such
counsel, accountants or experts.

                                       45
<PAGE>

     SECTION  7.05.  Liability  of  Agent.  Neither  the  Agent  nor  any of its
affiliates nor any of their respective directors,  officers, agents or employees
shall be liable  for any action  taken or not taken by it or them in  connection
herewith (i) with the consent or at the request of the Required Banks or (ii) in
the absence of its or their own gross negligence or willful misconduct.  Neither
the  Agent  nor any of its  affiliates  nor any of their  respective  directors,
officers,  agents  or  employees  shall be  responsible  for or have any duty to
ascertain, inquire into or verify (i) any statement,  warranty or representation
made in  connection  with this  Agreement or any borrowing  hereunder;  (ii) the
performance  or  observance  of any of the  covenants  or  agreements  of either
Borrower;  (iii) the  satisfaction  of any  condition  specified in Article III,
except  receipt of items  required  to be  delivered  to the Agent;  or (iv) the
validity, effectiveness or genuineness of this Agreement, the Notes or any other
instrument  or writing  furnished in  connection  herewith.  The Agent shall not
incur any liability by acting in reliance upon any notice, consent, certificate,
statement,  or  other  writing  (which  may be a  bank  wire,  telex,  facsimile
transmission or similar writing) believed by it to be genuine or to be signed by
the proper party or parties.

     SECTION 7.06. Indemnification.  Each Bank shall, ratably in accordance with
its  Commitment,  indemnify  the  Agent,  its  affiliates  and their  respective
directors,  officers,  agents and employees (to the extent not reimbursed by the
Borrowers) against any cost, expense (including counsel fees and disbursements),
claim,  demand,  action,  loss or  liability  (except  such as result  from such
indemnitees'  gross negligence or willful  misconduct) that such indemnitees may
suffer or incur in connection with this Agreement or any action taken or omitted
by such indemnitees hereunder.

     SECTION  7.07.  Credit  Decision.  Each  Bank  acknowledges  that  it  has,
independently  and without  reliance upon the Agent or any other Bank, and based
on such  documents and  information as it has deemed  appropriate,  made its own
credit  analysis  and  decision  to enter  into this  Agreement.  Each Bank also
acknowledges that it will,  independently and without reliance upon the Agent or
any other Bank,  and based on such  documents and  information  as it shall deem
appropriate at the time,  continue to make its own credit decisions in taking or
not taking any action under this Agreement.

     SECTION 7.08.  Successor  Agent. The Agent may resign at any time by giving
notice  thereof in  accordance  with Section 10.01 to the Banks and the Company.
Upon any

                                       46
<PAGE>

such resignation, the Borrowers, with the written consent of the Required Banks,
which  consent  shall  not be  unreasonably  withheld,  shall  have the right to
appoint a  successor  Agent,  which shall be one of the Banks.  If no  successor
Agent shall have been so appointed  by the  Borrowers,  and shall have  accepted
such  appointment,  within 30 days  after the  retiring  Agent  gives  notice of
resignation,  then the  retiring  Agent may,  on behalf of the Banks,  appoint a
successor  Agent,  which shall be a commercial  bank organized or licensed under
the laws of the United  States of America or of any State  thereof  and having a
combined  capital and surplus of at least  $500,000,000.  Upon the acceptance of
its  appointment as Agent hereunder by a successor  Agent,  such successor Agent
shall  thereupon  succeed to and become vested with all the rights and duties of
the retiring  Agent,  and the retiring Agent shall be discharged from its duties
and obligations  hereunder.  After any retiring Agent's resignation hereunder as
Agent,  the  provisions  of this  Article  shall  inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent.

     SECTION 7.09.  Agent's Fee. The Borrower shall pay to the Agent for its own
account fees in the amounts and at the times previously  agreed upon between the
Borrower and the Agent.


                                  ARTICLE VIII

                             CHANGE IN CIRCUMSTANCES

     SECTION 8.01. Basis for Determining  Interest Rate Inadequate or Unfair. If
on or prior to the first day of any Interest Period for any Fixed Rate Borrowing
(except a Money Market Absolute Rate Borrowing):

                  (a) the Agent is advised by the Reference  Banks that deposits
         in dollars (in the  applicable  amounts)  are not being  offered to the
         Reference Banks in the relevant market for such Interest Period, or

                  (b) in the case of a Committed Borrowing,  Banks having 50% or
         more of the aggregate  amount of the Commitments  advise the Agent that
         the Adjusted CD Rate or the London Interbank  Offered Rate, as the case
         may be, as  determined  by the Agent  will not  adequately  and  fairly
         reflect the cost to such Banks of funding their CD Loans or Euro-Dollar
         Loans, as the case may be, for such Interest Period,

                                       47
<PAGE>

the Agent  shall  forthwith  give  notice  thereof to the Company and the Banks,
whereupon  until the Agent  notifies the Company that the  circumstances  giving
rise to such suspension no longer exist, the obligations of the Banks to make CD
Loans or Euro-Dollar  Loans, as the case may be, shall be suspended.  Unless the
Borrower  notifies the Agent at least two Domestic Business Days before the date
of any Fixed Rate Borrowing for which a Notice of Borrowing has previously  been
given  that it  elects  not to  borrow  on such  date,  (i) if such  Fixed  Rate
Borrowing is a Committed  Borrowing,  such Borrowing  shall instead be made as a
Base Rate Borrowing pursuant to Article II and (ii) if such Fixed Rate Borrowing
is a Money Market LIBOR Borrowing,  the Money Market LIBOR Loans comprising such
Borrowing  shall bear  interest for each day from and including the first day to
but excluding the last day of the Interest Period applicable thereto at the Base
Rate for such day.

     SECTION 8.02. Illegality.  If, on or after the date of this Agreement,  the
adoption  of any  applicable  law,  rule or  regulation,  or any  change  in any
applicable  law,  rule or  regulation,  or any change in the  interpretation  or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration  thereof, or compliance
by any Bank (or its  Euro-Dollar  Lending  Office) with any request or directive
(whether or not having the force of law) of any such authority,  central bank or
comparable  agency  shall make it  unlawful or  impossible  for any Bank (or its
Euro-Dollar  Lending Office) to make,  maintain or fund its Euro-Dollar Loans to
either  Borrower  and such  Bank  shall so notify  the  Agent,  the Agent  shall
forthwith  give  notice  thereof to the other Banks and the  Company,  whereupon
until such Bank notifies the Company and the Agent that the circumstances giving
rise to such  suspension  no longer exist,  the  obligation of such Bank to make
Euro-Dollar Loans to such Borrower shall be suspended.  Before giving any notice
to the Agent  pursuant to this  Section,  such Bank shall  designate a different
Euro-Dollar  Lending Office if such  designation  will avoid the need for giving
such notice and will not, in the reasonable  judgment of such Bank, be otherwise
disadvantageous  to such  Bank.  If such Bank  shall  determine  that it may not
lawfully continue to maintain and fund any of its outstanding  Euro-Dollar Loans
to such Borrower to maturity and shall so specify in such notice,  such Borrower
shall immediately  prepay in full the then outstanding  principal amount of each
such Euro-Dollar Loan, together with accrued interest thereon. Concurrently with
prepaying  each such  Euro-Dollar  Loan,  such Borrower shall borrow a Base Rate
Loan (or, if such  Borrower so elects by at least one  Domestic  Business  Day's
notice to the Agent and such Bank,  such Borrower  shall borrow a CD Loan) in an
equal

                                       48
<PAGE>

principal  amount  from such  Bank (on which  interest  and  principal  shall be
payable  contemporaneously  with the  related  Euro-Dollar  Loans  of the  other
Banks),  and such Bank shall make such a Base Rate Loan or CD Loan,  as the case
may be.

     SECTION 8.03. Increased Cost and Reduced Return. (a) If on or after (x) the
date  hereof,  in the  case  of any  Committed  Loan or any  obligation  to make
Committed  Loans or (y) the date of the related Money Market Quote,  in the case
of  any  Money  Market  Loan,  the  adoption  of any  applicable  law,  rule  or
regulation,  or any change in any  applicable  law, rule or  regulation,  or any
change in the  interpretation  or  administration  thereof  by any  governmental
authority,  central bank or comparable agency charged with the interpretation or
administration  thereof,  or compliance by any Bank (or its  Applicable  Lending
Office) with any request or  directive  (whether or not having the force of law)
of any such authority, central bank or comparable agency:

                   (i) shall subject any Bank (or its Applicable Lending Office)
         to any tax,  duty or other charge with respect to its Fixed Rate Loans,
         its Notes or its  obligation to make Fixed Rate Loans,  or shall change
         the  basis of  taxation  of  payments  to any  Bank (or its  Applicable
         Lending Office) of the principal of or interest on its Fixed Rate Loans
         or any other  amounts due under this  Agreement in respect of its Fixed
         Rate Loans or its  obligation  to make Fixed  Rate  Loans  (except  for
         changes  in the rate of tax on the  overall  net income of such Bank or
         its Applicable Lending Office imposed by the jurisdiction in which such
         Bank's  principal  executive  office or  Applicable  Lending  Office is
         located); or

                  (ii) shall  impose,  modify or deem  applicable  any  reserve,
         special   deposit,   insurance   assessment   or  similar   requirement
         (including,  without  limitation,  any such requirement  imposed by the
         Board of Governors of the Federal  Reserve  System,  but  excluding (A)
         with  respect  to any CD  Loan  any  such  requirement  included  in an
         applicable  Domestic Reserve Percentage or Assessment Rate and (B) with
         respect to any Euro-Dollar  Loan any such  requirement  with respect to
         which  such  Bank is  entitled  to  compensation  during  the  relevant
         Interest Period under Section 2.16) against assets of, deposits with or
         for the account of, or credit  extended by, any Bank (or its Applicable
         Lending Office) or shall impose on any Bank (or its Applicable  Lending
         Office) or on the United States

                                       49
<PAGE>

         market for  certificates of deposit or the London  interbank market any
         other  condition  affecting  its  Fixed  Rate  Loans,  its Notes or its
         obligation to make Fixed Rate Loans;

and the result of any of the  foregoing is to increase the cost to such Bank (or
its Applicable  Lending Office) of making or maintaining any Fixed Rate Loan, or
to reduce  the amount of any sum  received  or  receivable  by such Bank (or its
Applicable  Lending  Office) under this Agreement or under its Note with respect
thereto,  by an amount deemed by such Bank to be material,  then, within 15 days
after demand by such Bank (with a copy to the Agent),  the Company  shall pay to
such Bank such  additional  amount or amounts as will  compensate  such Bank for
such increased cost or reduction.

     (b) If any Bank shall have  determined  that,  on or after the date hereof,
the  adoption  of any  applicable  law,  rule or  regulation  regarding  capital
adequacy,  or any change in any such law, rule or  regulation,  or any change in
the  interpretation  or  administration  thereof by any governmental  authority,
central  bank  or  comparable   agency  charged  with  the   interpretation   or
administration  thereof,  or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority,  central bank or
comparable  agency,  has or would have the effect of reducing the rate of return
on  capital  of such  Bank  (or its  Parent)  as a  consequence  of such  Bank's
obligations  hereunder  to a level  below that  which such Bank (or its  Parent)
could have achieved but for such adoption,  change, request or directive (taking
into  consideration  its policies with respect to capital adequacy) by an amount
deemed by such Bank to be material, then from time to time, within 15 days after
demand by such Bank (with a copy to the Agent),  the  Company  shall pay to such
Bank such  additional  amount or  amounts as will  compensate  such Bank (or its
Parent) for such reduction.

     (c) Each Bank will  promptly  notify the Company and the Agent of any event
of which it has knowledge,  occurring after the date hereof,  which will entitle
such  Bank to  compensation  pursuant  to this  Section  and  will  designate  a
different Applicable Lending Office if such designation will avoid the need for,
or reduce the amount  of,  such  compensation  and will not,  in the  reasonable
judgment of such Bank, be otherwise  disadvantageous to such Bank. A certificate
of any Bank  claiming  compensation  under this  Section  and  setting  forth in
reasonable detail the calculation of the additional amount or amounts to be paid
to it hereunder shall be presumed  correct unless and until it is shown to be in
error. In determining  such amount,  such Bank may use any reasonable  averaging
and attribution

                                       50
<PAGE>

methods.  If any Bank demands  compensation under Section 8.03(a),  the affected
Borrower may at any time,  upon at least five  Euro-Dollar  Business Days' prior
notice to such Bank through the Agent,  prepay in full each then  outstanding CD
Loan or  Euro-Dollar  Loan,  as the case may be,  of such  Bank,  together  with
accrued interest thereon to the date of prepayment.  Concurrently with prepaying
each such CD Loan or  Euro-Dollar  Loan, as the case may be, of such Bank,  such
Borrower  shall borrow a Base Rate Loan (or, if such Borrower  shall so elect in
its  notice of  prepayment,  such  Borrower  shall  borrow (i) if the Loan being
prepaid is a CD Loan, a Euro-Dollar Loan and (ii) if the Loan being prepaid is a
Euro-Dollar  Loan, a CD Loan) in an equal principal amount from such Bank for an
Interest  Period  coinciding  with the  remaining  term of the  Interest  Period
applicable  to such CD Loan or  Euro-Dollar  Loan being  prepaid,  and such Bank
shall make such a Base Rate Loan, CD Loan or  Euro-Dollar  Loan, as the case may
be.

     SECTION 8.04.  Substitute  Loans. If (i) the obligation of any Bank to make
Euro-Dollar Loans to either Borrower has been suspended pursuant to Section 8.02
or (ii)  any  Bank has  demanded  compensation  under  Section  8.03(a)  and the
Borrower shall, by at least five Euro-Dollar Business Days' prior notice to such
Bank through the Agent,  have elected that the  provisions of this Section shall
apply to such Bank,  then,  unless and until such Bank notifies the Company that
the  circumstances  giving rise to such suspension or demand for compensation no
longer apply:

                  (a) all Loans to such Borrower  which would  otherwise be made
         by such  Bank as CD Loans  or  Euro-Dollar  Loans,  as the case may be,
         shall be made instead as Base Rate Loans,  or if such Borrower shall so
         elect  in the  Notice  of  Borrowing,  CD Loans  or  Euro-Dollar  Loans
         (whichever type is not affected by such  circumstances) for an Interest
         Period coincident with the related Fixed Rate Borrowing, and

                  (b) after each of its CD Loans or  Euro-Dollar  Loans,  as the
         case  may be,  to such  Borrower  has  been  repaid,  all  payments  of
         principal  which  would  otherwise  be applied to repay such Fixed Rate
         Loans shall be applied to repay its Substitute Loans instead.

     SECTION 8.05.  Substitution  of Bank. If (i) the  obligation of any Bank to
make Euro-Dollar  Loans has been suspended  pursuant to Section 8.02 or (ii) any
Bank has demanded  compensation  under Section 8.03,  the Company shall have the
right, with the assistance of the Agent, to seek a

                                       51
<PAGE>

mutually satisfactory  substitute bank or banks (which may be one or more of the
Banks) to  purchase  the Notes and  assume  the  Commitment  of such  Bank.  The
purchase  price for such Notes shall be an amount equal to the principal  amount
thereof together with accrued interest thereon, accrued amounts (if any) for the
account of such Bank pursuant to Sections 2.16 and 8.03 and such amount (if any)
as such Bank would be entitled  to  pursuant  to Section  2.14 in respect of the
prepayment of its Notes on such date.


                                   ARTICLE IX

                                    GUARANTY

     SECTION 9.01. The Guaranty. The Company hereby  unconditionally  guarantees
the full and punctual payment (whether at stated maturity,  upon acceleration or
otherwise)  of the  principal  of and  interest  on each  Note  issued by Credit
Corporation pursuant to this Agreement, and the full and punctual payment of all
other amounts payable by Credit  Corporation under this Agreement.  Upon failure
by Credit  Corporation  to pay  punctually  any such amount,  the Company  shall
forthwith  on demand  pay the  amount not so paid at the place and in the manner
specified in this Agreement.

     SECTION  9.02.  Guaranty  Unconditional.  The  obligations  of the  Company
hereunder  shall  be  unconditional  and  absolute  and,  without  limiting  the
generality  of the  foregoing,  shall not be released,  discharged  or otherwise
affected by:

              (i) any  extension,  renewal,  settlement,  compromise,  waiver or
         release in respect of any obligation of Credit  Corporation  under this
         Agreement or any Note, by operation of law or otherwise;

             (ii) any  modification  or  amendment  of  or  supplement  to  this
         Agreement or any Note;

            (iii) any release,  non-perfection  or  invalidity  of any direct or
         indirect  security for any obligation of Credit  Corporation under this
         Agreement or any Note;

             (iv) any change in the corporate existence,  structure or ownership
         of Credit Corporation, or any insolvency, bankruptcy, reorganization or
         other similar proceeding  affecting Credit Corporation or its assets or
         any resulting release or discharge of any obligation of Credit

                                       52
<PAGE>

         Corporation contained in this Agreement or any Note;

                  (v) the existence of any claim,  set-off or other rights which
         the Company may have at any time against Credit Corporation, the Agent,
         any Bank or any other  Person,  whether in  connection  herewith or any
         unrelated transactions,  provided that nothing herein shall prevent the
         assertion   of  any  such  claim  by   separate   suit  or   compulsory
         counterclaim;

             (vi) any  invalidity  or  unenforceability  relating  to or against
         Credit Corporation for any reason of this Agreement or any Note, or any
         provision of applicable  law or  regulation  purporting to prohibit the
         payment by Credit  Corporation  of the  principal of or interest on any
         Note or any other amount payable by it under this Agreement; or

             (vii)  any  other  act or  omission  to act or delay of any kind by
         Credit  Corporation,  the  Agent,  any Bank or any other  Person or any
         other  circumstance  whatsoever  which might, but for the provisions of
         this paragraph, constitute a legal or equitable discharge of or defense
         to the Company's obligations hereunder.

     SECTION 9.03. Discharge Only Upon Payment In Full; Reinstatement In Certain
Circumstances.  The Company's  obligations  hereunder shall remain in full force
and effect until the Commitments  shall have terminated and the principal of and
interest  on the Notes and all other  amounts  payable by the Company and Credit
Corporation  under this  Agreement  shall have been paid in full. If at any time
any payment of the  principal  of or  interest  on any Note or any other  amount
payable by Credit  Corporation  under this  Agreement  is  rescinded  or must be
otherwise restored or returned upon the insolvency, bankruptcy or reorganization
of Credit  Corporation or otherwise,  the Company's  obligations  hereunder with
respect to such payment  shall be reinstated at such time as though such payment
had been due but not made at such time.

     SECTION  9.04.  Waiver  by the  Company.  The  Company  irrevocably  waives
acceptance hereof, presentment,  demand, protest and any notice not provided for
herein,  as well as any requirement  that at any time any action be taken by any
Person against Credit Corporation or any other Person.

                                       53
<PAGE>

     SECTION  9.05.  Subrogation.  The  Company  irrevocably  waives any and all
rights to which it may be  entitled,  by  operation  of law or  otherwise,  upon
making any payment hereunder to be subrogated to the rights of the payee against
Credit  Corporation  with respect to such payment or otherwise to be reimbursed,
indemnified  or  exonerated by Credit  Corporation  in respect  thereof,  in any
bankruptcy,  insolvency or similar  proceeding  involving Credit  Corporation as
debtor  commencing  within one year  after the  making of any  payment by Credit
Corporation under this Agreement or its Notes.

     SECTION 9.06. Stay of Acceleration.  In the event that  acceleration of the
time for  payment  of any  amount  payable  by Credit  Corporation,  under  this
Agreement or its Notes is stayed upon insolvency,  bankruptcy or  reorganization
of Credit Corporation,  all such amounts otherwise subject to acceleration under
the  terms  of this  Agreement  shall  nonetheless  be  payable  by the  Company
hereunder  forthwith  on demand by the Agent made at the request of the Required
Banks.


                                    ARTICLE X

                                  MISCELLANEOUS

     SECTION 10.01.  Notices. All notices,  requests and other communications to
any party hereunder shall be in writing  (including bank wire, telex,  facsimile
transmission  or similar  writing) and shall be given to such party:  (x) in the
case of either Borrower or the Agent, at its address,  facsimile number or telex
number set forth on the signature pages hereof,  (y) in the case of any Bank, at
its address,  facsimile  number or telex number set forth in its  Administrative
Questionnaire  or (z) in the case of any party,  such other  address,  facsimile
number or telex  number as such party may  hereafter  specify for the purpose by
notice  to the  Agent  and the  Company.  Each  such  notice,  request  or other
communication  shall be  effective  (i) if given by telex,  when  such  telex is
transmitted  to the telex number  specified in this Section and the  appropriate
answerback  is  received,  (ii)  if  given  by  facsimile   transmission,   when
transmitted to the facsimile  number  specified in this Section and confirmation
of receipt is received, (iii) if given by mail, upon receipt or (iv) if given by
any other  means,  when  delivered  at the address  specified  in this  Section;
provided that notices to the Agent under Article II or Article VIII shall not be
effective until received.

                                       54
<PAGE>

     SECTION 10.02. No Waivers.  No failure or delay by the Agent or any Bank in
exercising  any  right,  power or  privilege  hereunder  or under any Note shall
operate as a waiver  thereof  nor shall any single or partial  exercise  thereof
preclude  any other or further  exercise  thereof or the  exercise  of any other
right,  power or privilege.  The rights and remedies  herein  provided  shall be
cumulative and not exclusive of any rights or remedies provided by law.

     SECTION  10.03.  Expenses;  Documentary  Taxes;  Indemnification.  (a)  The
Company  shall  pay (i) all  reasonable  out-of-pocket  expenses  of the  Agent,
including fees and disbursements of special counsel for the Agent, in connection
with the preparation of this Agreement,  any waiver or consent  hereunder or any
amendment  hereof or any  Default or alleged  Default  hereunder  and (ii) if an
Event of Default occurs, all reasonable  out-of-pocket  expenses incurred by the
Agent and each Bank, including (without  duplication) the fees and disbursements
of outside  counsel and the  reasonably  allocated  cost of inside  counsel,  in
connection with such Event of Default and collection, bankruptcy, insolvency and
other enforcement  proceedings resulting therefrom.  The Company shall indemnify
each Bank against any transfer taxes,  documentary taxes, assessments or charges
made by any  governmental  authority by reason of the  execution and delivery of
this Agreement, or any Note.

     (b) The  Company  agrees  to  indemnify  the  Agent  and each  Bank,  their
respective  affiliates  and  the  respective  directors,  officers,  agents  and
employees  of the  foregoing  (each an  "Indemnitee")  and hold each  Indemnitee
harmless from and against any and all liabilities,  losses,  damages,  costs and
expenses of any kind,  including,  without  limitation,  the reasonable fees and
disbursements of counsel,  which may be reasonably incurred by any Indemnitee in
connection  with  any  investigative,   administrative  or  judicial  proceeding
(whether or not such Indemnitee shall be designated a party thereto) relating to
or arising out of this  Agreement;  provided that no  Indemnitee  shall have the
right to be  indemnified  hereunder  for its own  gross  negligence  or  willful
misconduct as determined by a court of competent jurisdiction.  It is understood
(except as provided  below) that the Company shall not, in  connection  with any
such claim, or separate but substantially  similar or related claims in the same
jurisdiction  arising out of the same general  allegations or circumstances,  be
liable for the fees and expenses of more than one separate firm of attorneys for
all  such  Indemnitees  which  firm  shall  be  designated  by  the  Agent.  Any
Indemnitees  shall  have the right to retain its own  counsel,  but the fees and
expenses  of such  counsel  (other  than the  firm  designated  by the  Agent as
aforesaid) shall be at the expense of such Indemnitee unless (i) the

                                       55
<PAGE>

Company on the one hand,  and such  Indemnitee  on the other shall have mutually
agreed to the  retention  of such  counsel  or (ii) the  representation  of such
Indemnitee by the same counsel  representing  the Agent,  the Banks or any other
party would in the reasonable view of such  Indemnitee be  inconsistent  with or
adverse to the interests of such Indemnitee. The Company shall not be liable for
any settlement of any such claim  effected  without its written  consent,  which
shall not be unreasonably withheld.

     SECTION 10.04.  Sharing of Set-Offs.  Each Bank agrees that if it shall, by
exercising any right of set-off or counterclaim or otherwise, receive payment of
a proportion of the aggregate  amount of principal and interest due with respect
to any Note held by it which is  greater  than the  proportion  received  by any
other Bank in respect of the aggregate amount of principal and interest due with
respect  to  any  Note  held  by  such  other  Bank,  the  Bank  receiving  such
proportionately  greater payment shall purchase such participations in the Notes
held by the other Banks,  and such other  adjustments  shall be made,  as may be
required so that all such payments of principal and interest with respect to the
Notes  held by the Banks  shall be shared by the Banks pro rata;  provided  that
nothing in this Section shall impair the right of any Bank to exercise any right
of set-off or  counterclaim  it may have and to apply the amount subject to such
exercise  to  the  payment  of   indebtedness  of  a  Borrower  other  than  its
indebtedness  hereunder.  Each  Borrower  agrees,  to the fullest  extent it may
effectively do so under  applicable law, that any holder of a participation in a
Note,  whether or not  acquired  pursuant  to the  foregoing  arrangements,  may
exercise rights of set-off or counterclaim and other rights with respect to such
participation  as  fully  as if such  holder  of a  participation  were a direct
creditor of such Borrower in the amount of such participation.

     SECTION 10.05.  Amendments and Waivers.  Any provision of this Agreement or
the Notes may be amended or waived if, but only if, such  amendment or waiver is
in writing and is signed by the  Borrowers  and the Required  Banks (and, if the
rights or duties of the Agent are affected thereby, by the Agent); provided that
no such amendment or waiver shall,  unless signed by all the Banks, (i) increase
or decrease the  Commitment  of any Bank  (except for a ratable  decrease in the
Commitments of all Banks) or subject any Bank to any additional obligation, (ii)
reduce the  principal of or rate of interest on any Loan or any fees  hereunder,
(iii) postpone the date fixed for any payment of principal of or interest on any
Loan or any fees hereunder,  (iv) postpone the date fixed for termination of any
Commitment,  or (v) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Notes, or

                                       56
<PAGE>

the number of Banks,  which  shall be  required  for the Banks or any of them to
take any action  under this Section or any other  provision  of this  Agreement.
Neither an assignment  pursuant to Section 10.06 nor a substitution  pursuant to
Section 8.05 constitutes an amendment  subject to the provisions of this Section
10.05.

     SECTION 10.06. Successors and Assigns. (a) The provisions of this Agreement
shall be binding  upon and inure to the benefit of the parties  hereto and their
respective  successors and assigns,  except that neither  Borrower may assign or
otherwise  transfer  any of its rights  under this  Agreement  without the prior
written consent of all Banks.

     (b)  Any  Bank  may at  any  time  grant  to one or  more  banks  or  other
institutions (each a "Participant")  participating interests in its Money Market
Loans or, upon notice to the Company,  in its Committed  Loans.  In the event of
any such grant by a Bank of a participating  interest to a Participant,  whether
or not upon  notice to the  Borrowers  and the  Agent,  such Bank  shall  remain
responsible for the performance of its obligations hereunder,  and the Borrowers
and the Agent  shall  continue  to deal  solely and  directly  with such Bank in
connection  with such Bank's rights and obligations  under this  Agreement.  Any
agreement  pursuant  to which any Bank may grant such a  participating  interest
shall provide that such Bank shall retain the sole right and  responsibility  to
enforce  the  obligations  of  the  Borrowers   hereunder   including,   without
limitation,  the right to approve any amendment,  modification  or waiver of any
provision of this  Agreement;  provided  that such  participation  agreement may
provide that such Bank will not agree to any  modification,  amendment or waiver
of this Agreement  described in clause (i), (ii), (iii) or (iv) of Section 10.05
without  the  consent  of  the  Participant.   The  Borrowers  agree  that  each
Participant  shall, to the extent provided in its  participation  agreement,  be
entitled  to the  benefits  of Section  2.16 with  respect to its  participating
interest to the same extent as a Bank. An assignment or other  transfer which is
not permitted by subsection  (c) or (d) below shall be given effect for purposes
of this  Agreement  only to the extent of a  participating  interest  granted in
accordance with this subsection (b).

     (c) With the prior written  consent of the Company and the Agent,  any Bank
may at any time  assign  to one or more  banks or  other  institutions  (each an
"Assignee") all, or a proportionate part (equivalent to an initial Commitment of
not less than $10,000,000 and not exceeding, together with all other assignments
by such transferor Bank and its affiliate transferees to non-affiliates,  50% of
its initial Commitment, except in any case as the Company and the Agent

                                       57
<PAGE>

may otherwise agree) of all, of its rights and obligations  under this Agreement
and the Notes,  and such  Assignee  shall  assume such  rights and  obligations,
pursuant to an Assignment and Assumption  Agreement in substantially the form of
Exhibit H hereto  executed by such Assignee and such transferor  Bank;  provided
that if an Assignee is an affiliate  of such  transferor  Bank,  no such consent
shall be required;  and provided further that such assignment may, but need not,
include  rights of the transferor  Bank in respect of  outstanding  Money Market
Loans.  Upon  execution  and  delivery  of such  instrument  and payment by such
Assignee to such transferor Bank of an amount equal to the purchase price agreed
between such  transferor  Bank and such Assignee,  such Assignee shall be a Bank
party to this Agreement and shall have all the rights and  obligations of a Bank
with a  Commitment  as set  forth  in such  instrument  of  assumption,  and the
transferor  Bank  shall  be  released  from  its  obligations   hereunder  to  a
corresponding  extent,  and no further  consent or action by any party  shall be
required.  Upon the  consummation of any assignment  pursuant to this subsection
(c), the  transferor  Bank, the Agent and the Borrowers  shall make  appropriate
arrangements  so that,  if required,  new Notes are issued to the  Assignee.  In
connection with any such assignment,  the transferor Bank shall pay to the Agent
an administrative fee for processing such assignment in the amount of $2,500.

     (d) Any Bank may at any time assign all or any portion of its rights  under
this Agreement and its Notes to a Federal Reserve Bank. No such assignment shall
release the transferor Bank from its obligations hereunder.

     (e) (i) No  Assignee  or other  transferee  of any Bank's  rights  shall be
entitled to receive any greater  payment under Section 8.03 than such Bank would
have been  entitled to receive  with respect to the rights  transferred,  unless
such transfer is made with the Company's  prior written  consent or by reason of
the  provisions  of Section  8.02 or 8.03  requiring  such Bank to  designate  a
different  Applicable  Lending Office under certain  circumstances  or at a time
when the circumstances giving rise to such greater payment did not exist.

     (ii) No Bank shall be entitled to additional interest under Section 2.16 on
any  portion of any  Euro-Dollar  Loan with  respect  to which it has  granted a
participation pursuant to subsection (b) above.

     (f) If any Reference Bank assigns its Note to an unaffiliated  institution,
or if the  Commitment  of any Reference  Bank is terminated  pursuant to Section
2.12 or 8.05, the Agent shall, with the consent of the Company and

                                       58
<PAGE>

the Required Banks, appoint another Bank to act as a Reference Bank hereunder.

     SECTION 10.07.  Collateral.  Each of the Banks  represents to the Agent and
each of the other  Banks that it in good faith is not  relying  upon any "margin
stock"  (as  defined  in  Regulation  U)  as  collateral  in  the  extension  or
maintenance of the credit provided for in this Agreement.

     SECTION  10.08.  Governing  Law.  This  Agreement  and each  Note  shall be
governed by and construed in accordance with the laws of the State of New York.

     SECTION 10.09. Counterparts;  Integration.  This Agreement may be signed in
any number of  counterparts,  each of which shall be an original,  with the same
effect as if the  signatures  thereto and hereto were upon the same  instrument.
This Agreement  constitutes  the entire  agreement and  understanding  among the
parties hereto and supersedes any and all prior  agreements and  understandings,
oral or written, relating to the subject matter hereof.

                                       59
<PAGE>

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be
duly  executed by their  respective  authorized  officers as of the day and year
first above written.

                             KERR-McGEE CORPORATION



                             By /s/ John C. Linehan
                                Title:  Senior Vice President and
                                           Chief Financial Officer



                             By /s/ Thomas B. Stephens
                                Title:  Vice President and Treasurer

                             Kerr-McGee Center
                             Oklahoma City, Oklahoma  73102
                             Attn: Treasurer
                             Telex No.: 747128
                             Telecopy No.:  405-270-3029 (automatic)
                                            405-270-3129 (manual)

                             KERR-McGEE CREDIT CORPORATION



                             By /s/ Thomas B. Stephens
                             Title:  Vice President and Treasurer

                             Kerr-McGee Center
                             Oklahoma City, Oklahoma  73102
                             Attn: Treasurer
                             Telex No.: 747128
                             Telecopy No.:  405-270-3029 (automatic)
                                            405-270-3129 (manual)

Commitments

$50,000,000                  MORGAN GUARANTY TRUST COMPANY
                                OF NEW YORK



                             By /s/ Vernon M. Ford, Jr.
                                Title:  Vice President

                                       60
<PAGE>

$35,000,000                  BANK OF AMERICA NATIONAL TRUST AND
                                SAVINGS ASSOCIATION



                             By /s/ J. Stephen Mernick
                                Title:  Senior Vice President


$35,000,000                  CITIBANK, N.A.



                             By /s/ Barbara A. Cohen
                                Title:  Vice President


$35,000,000                  TEXAS COMMERCE BANK NATIONAL ASSOCIATION



                             By /s/ Dale S. Hurd
                                Title:  Senior Vice President


$35,000,000                  THE FIRST NATIONAL BANK OF CHICAGO



                             By /s/ Helen A. Carr
                                Title:  Vice President


$25,000,000                  MELLON BANK, N.A.



                             By /s/ A. Gary Chace
                                Title:  Senior Vice President


$25,000,000                  NATIONSBANK OF TEXAS, N.A.



                             By /s/ William D. Clift
                                Title:  Senior Vice President

                                       61
<PAGE>

$25,000,000                  ROYAL BANK OF CANADA



                             By /s/ Everett M. Harner
                                Title: Manager


$20,000,000                  THE BANK OF NEW YORK



                             By /s/ Raymond J. Palmer
                                Title:  Vice President


$20,000,000                  THE FIRST NATIONAL BANK OF BOSTON



                             By /s/ Frank T. Smith, Jr.
                                Title: Director


$20,000,000                  WACHOVIA BANK OF GEORGIA, N.A.



                             By /s/ Terry L. Akins
                                Title:  Senior Vice President



Total Commitments

$325,000,000
=================
                             MORGAN GUARANTY TRUST COMPANY
                                OF NEW YORK, as Agent



                             By /s/ Vernon M. Ford, Jr.
                                Title:  Vice President

                             60 Wall Street
                             New York, New York  10260-0060
                             Attn: Loan Department
                             Telex number: 177615 MGT UT
                             Telecopy No.: 212-648-5014

                                       62
<PAGE>

                                PRICING SCHEDULE



     The "Euro-Dollar  Margin",  "CD Margin" and "Facility Fee Rate" for any day
are the respective  percentages  set forth below in the applicable row under the
column corresponding to the Status that exists on such day:

====================================================================
                        Level      Level      Level        Level
   Status                 I         II         III          IV
====================================================================
Euro-Dollar
Margin
  If Utiliza-
  tion is less
  than 50%              0.200%     0.235%     0.275%       0.500%

  If Utiliza-
  tion equals
  or exceeds
  50%                   0.250%     0.285%     0.325%       0.500%
--------------------------------------------------------------------
CD Margin
  If Utiliza-
  tion is
  less than
  50%                   0.325%     0.360%     0.400%       0.625%

  If Utiliza-
  tion equals
  or exceeds
  50%                   0.375%     0.410%     0.450%       0.625%
--------------------------------------------------------------------
Facility Fee
Rate                    0.100%     0.115%     0.175%       0.375%
====================================================================

     For  purposes of this  Schedule,  the  following  terms have the  following
meanings:

     "Level I  Status"  exists  at any  date if,  at such  date,  the  Company's
long-term debt is rated A+ or higher by S&P and A1 or higher by Moody's.

     "Level II Status"  exists at any date if, at such date,  (i) the  Company's
long-term debt is rated A- or higher

<PAGE>

by S&P and A3 or higher by Moody's and (ii) Level I Status does not exist.

     "Level III Status"  exists at any date if, at such date,  (i) the Company's
long-term  debt is rated BBB or higher by S&P and Baa2 or higher by Moody's  and
(ii) neither Level I Status nor Level II Status exists.

     "Level IV  Status"  exists at any date if, at such  date,  no other  Status
exists.

     "Status" refers to the  determination of which of Level I Status,  Level II
Status, Level III Status or Level IV Status exists at any date.

     "Utilization" means at any date the percentage equivalent of a fraction (i)
the  numerator of which is the  aggregate  outstanding  principal  amount of the
Loans at such date,  after  giving  effect to any  borrowing  or payment on such
date,  and  (ii)  the  denominator  of  which  is the  aggregate  amount  of the
Commitments  at  such  date,  after  giving  effect  to  any  reduction  of  the
Commitments on such date.  For purposes of this Schedule,  if for any reason any
Loans remain  outstanding after termination of the Commitments,  the Utilization
for each  date on or after  the date of such  termination  shall be deemed to be
greater than 50%.

     The credit  ratings to be utilized for purposes of this  Schedule are those
assigned  to the senior  unsecured  long-term  debt  securities  of the  Company
without  third-party  credit  enhancement,  and any rating assigned to any other
debt security of the Company shall be  disregarded.  The rating in effect at any
date is that in effect at the close of business on such date.

     If the Company's debt  securities are rated by only one of Moody's and S&P,
Status shall be determined based on the rating assigned by that rating agency.

                                        2
<PAGE>

                                                                 EXHIBIT A


                                      NOTE


                                                             New York, New York
                                                             August 25, 1994


     For   value   received,   [KERR-McGEE   CORPORATION]   [KERR-McGEE   CREDIT
CORPORATION],  a Delaware  corporation (the "Borrower"),  promises to pay to the
order of (the "Bank"),  for the account of its Applicable  Lending  Office,  the
unpaid principal  amount of each Loan made by the Bank to the Borrower  pursuant
to the Credit Agreement referred to below on the last day of the Interest Period
relating  to such Loan.  The  Borrower  promises  to pay  interest on the unpaid
principal  amount  of each  such  Loan on the  dates  and at the  rate or  rates
provided  for in the  Credit  Agreement.  All such  payments  of  principal  and
interest  shall be made in lawful money of the United States in Federal or other
immediately  available  funds at the office of Morgan  Guaranty Trust Company of
New York, 60 Wall Street, New York, New York.

     All Loans made by the Bank, the respective types and maturities thereof and
all  repayments of the  principal  thereof shall be recorded by the Bank and, if
the Bank so  elects in  connection  with any  transfer  or  enforcement  hereof,
appropriate notations to evidence the foregoing information with respect to each
such Loan then outstanding may be endorsed by the Bank on the schedule  attached
hereto,  or on a  continuation  of such  schedule  attached  to and  made a part
hereof;  provided that the failure of the Bank to make any such  recordation  or
endorsement shall not affect the obligations of the Borrower  hereunder or under
the Credit Agreement.

     This note is one of the Notes referred to in the Credit  Agreement dated as
of August 25, 1994 among Kerr-

<PAGE>

McGee  Corporation,  Kerr-McGee  Credit  Corporation,  the  banks  listed on the
signature  pages thereof and Morgan Guaranty Trust Company of New York, as Agent
(as the same may be amended from time to time,  the "Credit  Agreement").  Terms
defined  in the  Credit  Agreement  are used  herein  with  the  same  meanings.
Reference is made to the Credit  Agreement  for  provisions  for the  prepayment
hereof and the acceleration of the maturity hereof.

     [Kerr-McGee  Corporation  has,  pursuant  to the  provisions  of the Credit
Agreement,  unconditionally  guaranteed  the payment in full of the principal of
and interest on this note.]**

                                                     [KERR-McGEE CORPORATION]
                                                     [KERR-McGEE CREDIT
                                                       CORPORATION]



                                                     By________________________
                                                        Title:


--------
**To be deleted in the case of Notes executed and
delivered by Kerr-McGee Corporation.

                                        2

<PAGE>

                                  Note (cont'd)

                         LOANS AND PAYMENTS OF PRINCIPAL



------------------------------------------------------------------

                                 Amount of
           Amount of   Type of   Principal    Maturity   Notation
   Date         Loan      Loan      Repaid        Date    Made By
------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------

------------------------------------------------------------------


                                        3
<PAGE>


                                                                      EXHIBIT B


                       Form of Money Market Quote Request


                                                                  [Date]




To:               Morgan Guaranty Trust Company of New York
                    (the "Agent")

From:             [Kerr-McGee Corporation]
                  [Kerr-McGee Credit Corporation]

Re:               Credit Agreement (the "Credit Agreement")
                  dated as of August 25, 1994 among Kerr-McGee
                  Corporation, Kerr-McGee Credit Corporation,
                  the Banks listed on the signature pages
                  thereof and the Agent


                  We hereby give notice  pursuant to Section  2.03 of the Credit
Agreement  that we request Money Market Quotes for the following  proposed Money
Market Borrowing(s):


Date of Borrowing:  __________________

Principal Amount***                                     Interest Period****

$


     Such Money Market  Quotes  should offer a Money Market  [Margin]  [Absolute
Rate]. [The applicable base rate is the London Interbank Offered Rate.]


--------
     ***Amount must be $10,000,000 or a larger  multiple of $1,000,000.  ****Not
less than one month  (LIBOR  Auction)  or not less  than 7 days  (Absolute  Rate
Auction), subject to the provisions of the definition of Interest Period.

<PAGE>

     Terms  used  herein  have  the  meanings  assigned  to them  in the  Credit
Agreement.


                                                     [KERR-McGEE CORPORATION]
                                                     [KERR-McGEE CREDIT
                                                       CORPORATION]



                                                     By________________________
                                                        Title:



                                        2
<PAGE>

                                                                      EXHIBIT C



                   Form of Invitation for Money Market Quotes


To:               [Name of Bank]

Re:               Invitation for Money Market Quotes to [Kerr-
                  McGee Corporation] [Kerr-McGee Credit
                  Corporation] (the "Borrower")


                  Pursuant to Section 2.03 of the Credit  Agreement  dated as of
August 25, 1994 among Kerr-McGee Corporation, Kerr-McGee Credit Corporation, the
Banks parties thereto and the undersigned, as Agent, we are pleased on behalf of
the Borrower to invite you to submit Money Market Quotes to the Borrower for the
following proposed Money Market Borrowing(s):


Date of Borrowing:  __________________

Principal Amount                                        Interest Period


$


     Such Money Market  Quotes  should offer a Money Market  [Margin]  [Absolute
Rate]. [The applicable base rate is the London Interbank Offered Rate.]

     Please respond to this  invitation by no later than [2:00 P.M.] [9:30 A.M.]
(New York City time) on [date].


                                                   MORGAN GUARANTY TRUST COMPANY
                                                       OF NEW YORK


                                                   By______________________
                                                       Authorized Officer

<PAGE>

                                                                      EXHIBIT D



                           Form of Money Market Quote



To:               Morgan Guaranty Trust Company of New York,
                    as Agent

Re:               Money Market Quote to [Kerr-McGee
                  Corporation] [Kerr-McGee Credit
                  Corporation] (the "Borrower")


                  In response to your invitation on behalf of the Borrower dated
_____________,  19__,  we hereby make the  following  Money  Market Quote on the
following terms:

1.       Quoting Bank:  ________________________________

2.       Person to contact at Quoting Bank:

         -----------------------------

3.       Date of Borrowing: ____________________*

4.       We hereby offer to make Money Market Loan(s) in the following principal
         amounts, for the following Interest Periods and at the following rates:

Principal          Interest           Money Market
 Amount**          Period***          [Margin****]   [Absolute Rate*****]

$

$


         [Provided,  that the aggregate  principal  amount of Money Market Loans
         for  which  the  above   offers  may  be  accepted   shall  not  exceed
         $____________.]**


----------

* As specified in the related Invitation.
** Principal amount bid for each Interest Period may not
exceed principal amount requested.  Specify aggregate
limitation if the sum of the individual offers exceeds the

<PAGE>

amount the Bank is willing to lend. Bids must be made for $5,000,000 or a larger
multiple of $1,000,000.

                    (notes continued on following page)


     We understand  and agree that the offer(s) set forth above,  subject to the
satisfaction  of the  applicable  conditions  set forth in the Credit  Agreement
dated as of August 25,  1994 among  Kerr-McGee  Corporation,  Kerr-McGee  Credit
Corporation,  the Banks listed on the signature pages thereof and yourselves, as
Agent,  irrevocably  obligates us to make the Money Market Loan(s) for which any
offer(s) are accepted, in whole or in part.


                                                     Very truly yours,

                                                     [NAME OF BANK]


Dated:_______________                           By:__________________________
                                                        Authorized Officer



----------

*** Not less than one month or not less than 7 days, as specified in the related
Invitation.  No more than five bids are permitted for each Interest Period. ****
Margin  over or under the  London  Interbank  Offered  Rate  determined  for the
applicable  Interest Period.  Specify percentage (to the nearest 1/10,000 of 1%)
and specify whether "PLUS" or "MINUS".  ***** Specify rate of interest per annum
(to the nearest 1/10,000th of 1%).


                                        2

<PAGE>


                                                                      EXHIBIT E



                               OPINION OF GENERAL
                             COUNSEL OF THE COMPANY



To the Banks and the Agent
  Referred to Below
c/o Morgan Guaranty Trust Company
  of New York, as Agent
60 Wall Street
New York, New York  10260

Dear Sirs:

     I am General  Counsel of  Kerr-McGee  Corporation  (the  "Company")  and am
familiar with the Credit Agreement (the "Credit  Agreement")  dated as of August
25, 1994 among the Company, Kerr-McGee Credit Corporation ("Credit Corporation")
(each  of  the  Company  and  Credit  Corporation   singly,  a  "Borrower"  and,
collectively,  "Borrowers"), the banks listed on the signature pages thereof and
Morgan Guaranty Trust Company of New York, as Agent. Terms defined in the Credit
Agreement are used herein as therein defined.  This opinion is being rendered to
you at the request of the  Borrowers  pursuant to Section  3.01(c) of the Credit
Agreement.

     I have examined originals or copies,  certified or otherwise  identified to
my satisfaction,  of such documents,  corporate records,  certificates of public
officials and other instruments and have conducted such other  investigations of
fact and law as I have  deemed  necessary  or  advisable  for  purposes  of this
opinion.

     Upon the basis of the foregoing, I am of the opinion that:

     1.  Each of the  Borrowers  is a  corporation  duly  incorporated,  validly
existing and in good standing under the laws of Delaware,  and has all corporate
powers required to carry on its business as now conducted.

     2.  Each  of  the  Borrowers  has  all  material   governmental   licenses,
authorizations, consents and


<PAGE>

approvals  required to carry on its business as now conducted and which,  if not
obtained,  could reasonably be expected to have a material adverse effect on the
business or  operations  of the Company and its  Subsidiaries,  considered  as a
whole.

     3. The execution,  delivery and  performance by each Borrower of the Credit
Agreement and its Notes are within the corporate  powers of such Borrower,  have
been duly authorized by all necessary corporate action,  require no action by or
in respect of, or filing with, any governmental  body, agency or official and do
not contravene,  or constitute a default under,  any provision of applicable law
or  regulation  or of the  certificate  of  incorporation  or  by-laws of either
Borrower  or,  to  the  best  of  my  knowledge,  of  any  agreement,  judgment,
injunction,  order,  decree or other instrument  binding upon either Borrower or
result in the creation or imposition of any Lien on any asset of either Borrower
or any of its Subsidiaries.

     4. The Credit Agreement  constitutes a valid and binding  agreement of each
of the Company and Credit Corporation, and the Notes of each Borrower constitute
its valid and binding  obligations in each case  enforceable in accordance  with
their  respective  terms,  except  as the same  may be  limited  by  bankruptcy,
insolvency or similar laws affecting  creditors' rights generally and by general
principles of equity.

     5. Except as may have been  disclosed  in writing to the Banks prior to the
signing of the Credit Agreement,  there is no action, suit or proceeding pending
against,  or to the best of my knowledge  threatened  against or affecting,  the
Company  or any of its  Subsidiaries  before  any  court  or  arbitrator  or any
governmental body, agency or official, which involves any substantial risk of an
adverse  decision  which  would  result in any  material  adverse  effect on the
business,  consolidated financial position or consolidated results of operations
of the Company and its  Consolidated  Subsidiaries,  considered  as a whole,  or
which  involves any material risk of an adverse  decision  which would draw into
question the validity of the  obligations  of either  Borrower  under the Credit
Agreement or the Notes of such Borrower.

     6. Each of the Material  Subsidiaries is a corporation  duly  incorporated,
validly  existing and in good  standing  under the laws of its  jurisdiction  of
incorporation, and has all corporate powers required to carry on its business as
now conducted.  Each Material Subsidiary has all material governmental licenses,
authorizations,  consents and approvals required to carry on its business as now
conducted  and which,  if not obtained,  could  reasonably be expected to have a
material adverse


                                        2

<PAGE>

effect  on the  business  or  operations  of the  Company  and its  Subsidiaries
considered as a whole.

     I am a  member  of the Bar of the  State  of  Oklahoma,  and the  foregoing
opinion is limited to the laws of the State of Oklahoma, the General Corporation
Law of the  State of  Delaware  and the  Federal  laws of the  United  States of
America.  Inasmuch as the Credit Agreement and the Notes are governed by the law
of the State of New York, I have assumed for purposes of the  foregoing  opinion
that such law is the same as the law of the State of  Oklahoma.  I have not been
called upon to, and  accordingly  do not,  express any opinion on the effect (if
any) of any law of any jurisdiction  (except the State of Oklahoma) in which any
Bank is located  which limits the rate of interest  that such Bank may charge or
collect.

                                Very truly yours,


                                        3

<PAGE>

                                                                      EXHIBIT F


                                   OPINION OF
                     DAVIS POLK & WARDWELL, SPECIAL COUNSEL
                                  FOR THE AGENT



To the Banks and the Agent
  Referred to Below
c/o Morgan Guaranty Trust Company
  of New York, as Agent
60 Wall Street
New York, New York  10260

Dear Sirs:

     We have  participated  in the  preparation  of the  Credit  Agreement  (the
"Credit Agreement") dated as of August 25, 1994 among Kerr-McGee Corporation,  a
Delaware corporation, Kerr-McGee Credit Corporation, a Delaware corporation, the
banks listed on the signature  pages  thereof (the "Banks") and Morgan  Guaranty
Trust  Company of New York,  as Agent (the  "Agent"),  and have acted as special
counsel  for the Agent for the purpose of  rendering  this  opinion  pursuant to
Section 3.01(d) of the Credit  Agreement.  Terms defined in the Credit Agreement
are used herein as therein defined.

     We have examined originals or copies,  certified or otherwise identified to
our satisfaction,  of such documents,  corporate records, certificates of public
officials and other instruments and have conducted such other  investigations of
fact and law as we have  deemed  necessary  or  advisable  for  purposes of this
opinion.

     Upon the basis of the foregoing, we are of the opinion that:

     1. The execution,  delivery and  performance by each Borrower of the Credit
Agreement  and its Notes are within such  Borrower's  corporate  powers and have
been duly authorized by all necessary corporate action.

<PAGE>

     2. The Credit Agreement  constitutes a valid and binding  agreement of each
of  the  Company  and  Credit  Corporation,  and  each  Note  of  each  Borrower
constitutes  a valid  and  binding  obligation  of such  Borrower,  in each case
enforceable in accordance  with its terms,  except as the same may be limited by
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
by general principles of equity.

     We are  members  of the Bar of the  State  of New  York  and the  foregoing
opinion is limited to the laws of the State of New York, the federal laws of the
United  States  of  America  and the  General  Corporation  Law of the  State of
Delaware.  In giving  the  foregoing  opinion,  we  express no opinion as to the
effect (if any) of any law of any jurisdiction (except the State of New York) in
which any Bank is located  which limits the rate of interest  that such Bank may
charge or collect.

     This opinion is rendered solely to you in connection with the above matter.
This opinion may not be relied upon by you for any other  purpose or relied upon
by any other person without our prior written consent.

                                                     Very truly yours,



                                        2
<PAGE>


                                                                      EXHIBIT G


                          FORM OF AUDITOR'S CERTIFICATE


To Kerr-McGee Corporation:

     We have examined the consolidated  balance sheet of Kerr-McGee  Corporation
(a Delaware  corporation),  and subsidiary companies as of December 31, 19__ and
19__, and the related consolidated  statements of income,  retained earnings and
cash flows for each of the three years in the period  ended  December  31, 19__,
and have issued our report thereon dated February __, 19__. Our  examination was
made in accordance with generally accepted auditing standards and,  accordingly,
included such tests of the accounting records and such other auditing procedures
as we considered necessary in the circumstances.

     We have read the credit  agreement  (the  "Credit  Agreement")  dated as of
August 25, 1994 among Kerr-McGee Corporation (the "Company"),  Kerr-McGee Credit
Corporation, the banks listed on the signature pages thereof and Morgan Guaranty
Trust  Company of New York,  as Agent,  particularly  Articles  V and VI.  These
articles contain certain  covenants of the Company relative to certain financial
conditions and describe events of default  relative to such  covenants.  We have
also  read  the  accompanying  officer's  certificate  prepared  by  your  chief
accounting officer described in Section 5.01(c) of the Credit Agreement.

     In connection  with our  examination,  nothing came to our  attention  that
caused us to believe  that you were in  default  with any of the  provisions  of
Article  VI of the  Credit  Agreement  insofar  as they  pertain  to  accounting
matters.  It should be noted that our  examination  was not  directed  primarily
toward obtaining knowledge of noncompliance.

                                                     Very truly yours,


<PAGE>
                                                                      EXHIBIT H


                       ASSIGNMENT AND ASSUMPTION AGREEMENT



     AGREEMENT dated as of _________,  19__ among  [ASSIGNOR] (the  "Assignor"),
[ASSIGNEE] (the "Assignee"),  [KERR-McGEE CORPORATION (the "Company") and MORGAN
GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the "Agent")].


                               W I T N E S S E T H


     WHEREAS, this Assignment and Assumption Agreement (the "Agreement") relates
to the  Credit  Agreement  dated  as of  August  25,  1994  among  the  Company,
Kerr-McGee Credit  Corporation,  the Assignor and the other Banks party thereto,
as Banks, and the Agent (the "Credit Agreement");

     WHEREAS,  as  provided  under the  Credit  Agreement,  the  Assignor  has a
Commitment  to  make  Loans  in  an  aggregate  principal  amount  at  any  time
outstanding not to exceed $______________;

     WHEREAS, Committed Loans made by the Assignor under the Credit Agreement in
the  aggregate  principal  amount of  $__________  are  outstanding  at the date
hereof; and

     WHEREAS,  the Assignor proposes to assign to the Assignee all of the rights
of the  Assignor  under the  Credit  Agreement  in  respect  of a portion of its
Commitment thereunder in an amount equal to $__________ (the "Assigned Amount"),
together with a corresponding  portion of its outstanding  Committed  Loans, and
the  Assignee  proposes  to accept  assignment  of such  rights  and  assume the
corresponding obligations from the Assignor on such terms;

     NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:

     SECTION 1. Definitions.  All capitalized terms not otherwise defined herein
shall have the respective meanings set forth in the Credit Agreement.

     SECTION  2.  Assignment.  The  Assignor  hereby  assigns  and  sells to the
Assignee all of the rights of the

<PAGE>

Assignor under the Credit  Agreement to the extent of the Assigned  Amount,  and
the Assignee hereby accepts such assignment from the Assignor and assumes all of
the obligations of the Assignor under the Credit  Agreement to the extent of the
Assigned Amount,  including the purchase from the Assignor of the  corresponding
portion of the  principal  amount of the  Committed  Loans made by the  Assignor
outstanding  at the date hereof.  Upon the execution and delivery  hereof by the
Assignor,  the  Assignee[,  the  Company  and the Agent] and the  payment of the
amounts  specified  in Section 3 required  to be paid on the date hereof (i) the
Assignee shall, as of the date hereof, succeed to the rights and be obligated to
perform the  obligations of a Bank under the Credit  Agreement with a Commitment
in an  amount  equal to the  Assigned  Amount,  and (ii) the  Commitment  of the
Assignor  shall,  as of the date  hereof,  be reduced  by a like  amount and the
Assignor  released from its obligations under the Credit Agreement to the extent
such obligations have been assumed by the Assignee.  The assignment provided for
herein shall be without recourse to the Assignor.

     SECTION  3.  Payments.   As  consideration  for  the  assignment  and  sale
contemplated in Section 2 hereof,  the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore agreed between  them.***** It
is understood  that  commitment  and/or facility fees in respect of the Assigned
Amount  accrued to the date hereof are for the account of the  Assignor and such
fees  accruing  from and  including  the date  hereof are for the account of the
Assignee.  Each  of the  Assignor  and the  Assignee  hereby  agrees  that if it
receives any amount under the Credit  Agreement  which is for the account of the
other  party  hereto,  it shall  receive  the same for the account of such other
party to the extent of such other party's  interest  therein and shall  promptly
pay the same to such other party.

     [SECTION  4.  Consent of the  Company  and the  Agent.  This  Agreement  is
conditioned  upon the consent of the  Company and the Agent  pursuant to Section
10.06(c) of the Credit Agreement. The execution of this Agreement by the Company
and the Agent is evidence of this  consent.  Pursuant  to Section  10.06(c)  the
Company agrees to execute and deliver a Note and to cause Credit  Corporation to
execute

--------
*****  Amount  should  combine  principal  together  with  accrued  interest and
breakage compensation, if any, to be paid by the Assignee, net of any portion of
any upfront fee to be paid by the Assignor to the Assignee. It may be preferable
in an appropriate case to specify these amounts generically or by formula rather
than as a fixed sum.
                                        2

<PAGE>

and  deliver  a Note  payable  to the  order of the  Assignee  to  evidence  the
assignment and assumption provided for herein.]

     SECTION 5.  Non-Reliance on Assignor.  The Assignor makes no representation
or warranty in connection  with, and shall have no  responsibility  with respect
to, the solvency,  financial  condition,  or statements of any Borrower,  or the
validity and enforceability of the obligations of any Borrower in respect of the
Credit  Agreement  or  any  Note.  The  Assignee   acknowledges   that  it  has,
independently and without reliance on the Assignor,  and based on such documents
and information as it has deemed  appropriate,  made its own credit analysis and
decision to enter into this  Agreement and will continue to be  responsible  for
making its own  independent  appraisal of the  business,  affairs and  financial
condition of the Borrowers.

     SECTION 6. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.

     SECTION  7.  Counterparts.  This  Agreement  may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

     IN WITNESS  WHEREOF,  the parties have caused this Agreement to be executed
and  delivered  by their duly  authorized  officers  as of the date first  above
written.


                                                    [ASSIGNOR]


                                                    By_________________________
                                                      Title:



                                                    [ASSIGNEE]


                                                    By_________________________
                                                      Title:

                                        3
<PAGE>

                                                   KERR-McGEE CORPORATION


                                                   By__________________________
                                                     Title:


                                                   MORGAN GUARANTY TRUST COMPANY
                                                     OF NEW YORK


                                                   By__________________________
                                                      Title:


                                        4



                                                                 CONFORMED COPY

               AMENDED AND RESTATED CREDIT AGREEMENT


               AMENDED AND  RESTATED  CREDIT  AGREEMENT  dated as of December 4,
1996 among KERR-McGEE  CORPORATION,  KERR-McGEE  CREDIT  CORPORATION,  the BANKS
listed on the  signature  pages hereof (the "Banks") and MORGAN  GUARANTY  TRUST
COMPANY OF NEW YORK, as Agent (the "Agent").


                                  W I T N E S S E T H :


               WHEREAS,  certain of the parties hereto have  heretofore  entered
into a Credit Agreement dated as of August 25, 1994 (the "Agreement"); and

               WHEREAS,  the parties hereto desire to amend the Agreement as set
forth  herein and to restate the  Agreement in its entirety to read as set forth
in the Agreement with the amendments specified below;

               NOW, THEREFORE, the parties hereto agree as follows:

               SECTION 1. Definitions; References. Unless otherwise specifically
defined  herein,  each  capitalized  term used  herein  which is  defined in the
Agreement  shall have the meaning  assigned to such term in the Agreement.  Each
reference to "hereof", "hereunder", "herein" and "hereby" and each other similar
reference  and  each  reference  to "this  Agreement"  and  each  other  similar
reference  contained in the Agreement shall from and after the date hereof refer
to the Agreement as amended and restated hereby. The term "Notes" defined in the
Agreement  shall include from and after the date hereof the New Note (as defined
below).

               SECTION 2.  Amendment  of Termination  Date.  The  definition  of
"Termination Date" in  Section 1.01 of  the  Agreement is amended to read in its
entirety as follows:

               "Termination Date" means December 4, 2001, or, if such day is not
a Euro-Dollar Business Day, the next succeeding Euro-Dollar Business Day, unless
such Euro-Dollar Business Day falls in another calendar month, in which case the
Termination Date shall be the next preceding Euro-Dollar Business Day.

               SECTION 3.  Amendment of Sections 4.04 and 4.05. Each reference
to "1993" in Sections 4.04 and 4.05 of  the Agreement is amended to read "1995."

               SECTION 4. Changes in Commitments. With effect from and including
the date this Amendment and  Restatement  becomes  effective in accordance  with
Section 8 hereof,  (i) each Person listed on the signature pages hereof which is
not a party to the  Agreement  (a "New Bank")  shall  become a Bank party to the
Agreement  and (ii) the  Commitment  of each Bank  shall be the amount set forth
opposite the name of such Bank on the  signature  pages  hereof.  Any Bank whose
Commitment is changed to zero shall upon such  effectiveness  cease to be a Bank
party to the Agreement, and all accrued fees and other amounts payable under the
Agreement  for the  account of such Bank shall be due and  payable on such date;
provided that the  provisions  of Sections 8.03 and 9.03 of the Agreement  shall
continue to inure to the benefit of each such Bank.

               SECTION 5.  Amendment of  Pricing Schedule.  The Pricing Schedule
is amended to read  in its  entirety as set forth in Exhibit I to this Amendment
and Restatement.

               SECTION 6.  Representations and Warranties.  The Borrower  hereby
represents  and  warrants that  as of  the date  hereof and  after giving effect
hereto:

               (a)  no Default has occurred and is continuing; and

               (b) each representation and warranty of the Borrower set forth in
the Agreement is true and correct as though made on and as of this date.

               SECTION 7.  Governing Law.  This  Amendment and Restatement shall
be  governed  by and construed  in accordance  with the laws of the State of New
York.

               SECTION  8.  Counterparts;   Effectiveness.  This  Amendment  and
Restatement may be signed in any number of counterparts,  each of which shall be
an original,  with the same effect as if the signatures  thereto and hereto were
upon the same instrument.  This Amendment and Restatement shall become effective
as of the date  hereof  when (i) the Agent  shall have  received  duly  executed
counterparts hereof signed by each of the parties hereto (or, in the case of any
party as to which an  executed  counterpart  shall not have been  received,  the
Agent shall have received telegraphic,  telex or other written confirmation from
such party of execution of a counterpart  hereof by such party);  (ii) the Agent
shall  have  received  a duly  executed  Note for each of the New  Banks (a "New
Note"),  dated on or before the date of  effectiveness  hereof and  otherwise in
compliance  with  Section  2.05 of the  Agreement;  (iii) the Agent  shall  have
received  an  opinion of the  General  Counsel  of the  Borrower  (or such other
counsel for the Borrower as may be  acceptable to the Agent),  substantially  in
the form of Exhibit E to the  Agreement  with  reference to the New Notes,  this
Amendment and Restatement and the Agreement as amended and restated hereby;  and
(iv) the Agent shall have  received  all  documents  it may  reasonably  request
relating to the existence of the Borrower,  the corporate  authority for and the
validity of the  Agreement as amended and restated  hereby the New Notes and any
other matters  relevant  hereto,  all in form and substance  satisfactory to the
Agent.


               IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their  respective  authorized  officers as of the day and
year first above written.


                             KERR-McGEE CORPORATION


                             By /s/ John C. Linehan
                                Title: Senior Vice President
                                        and Chief Financial Officer


                             By /s/ John M. Rauh
                                Title: Vice President and Treasurer



                             KERR-McGEE CREDIT CORPORATION


                             By /s/ John C. Linehan
                                Title: Senior Vice President
                                        and Chief Financial Officer


<PAGE>


Commitments

$55,000,000                  MORGAN GUARANTY TRUST COMPANY
                                   OF NEW YORK



                                    By /s/ John Kowalczuk
                                       Title: Vice President


$40,000,000                  THE FIRST NATIONAL BANK OF CHICAGO



                                    By /s/ Leo Loughead
                                       Title: Corporate Banking Officer


$35,000,000                  CITIBANK, N.A.



                                    By /s/ Arezod Jafari
                                       Title: Assistant Vice President


$35,000,000                  NATIONSBANK OF TEXAS, N.A.



                                    By /s/ Dale T. Wilson
                                       Title: Vice President



$35,000,000                  ROYAL BANK OF CANADA



                                    By /s/ Linda M. Stephens
                                       Title: Manager

<PAGE>

$35,000,000                  TEXAS COMMERCE BANK NATIONAL




                                    By /s/ Donna J. Berman
                                       Title: Senior Vice President


$25,000,000                  THE BANK OF NEW YORK



                                    By /s/ Raymond J. Palmer
                                       Title: Vice President


$25,000,000                  MELLON BANK, N.A.



                                    By /s/ E. Marc Culnod Jr.
                                       Title: First Vice President


$20,000,000                  UMB, OKLAHOMA BANK



                                    By /s/ David Schaefer
                                       Title: Senior Vice President



$20,000,000                  WACHOVIA BANK OF GEORGIA, N.A.



                                    By /s/ Joel K. Wood
                                       Title: Vice President


$0                                  BANK OF AMERICA NATIONAL TRUST AND
                                         SAVINGS ASSOCIATION



                                    By /s/ Richard D. Bluth
                                       Title: Vice President


$0                                  THE FIRST NATIONAL BANK OF BOSTON



                                    By /s/ Frank T. Smith
                                       Title: Director





                                    MORGAN GUARANTY TRUST COMPANY
                                      OF NEW YORK, as Agent


                                    By /s/ John Kowalczuk
                                       Title: Vice President


<PAGE>

EXHIBIT I

                             PRICING SCHEDULE


           The "Euro-Dollar Margin", "CD Margin" and "Facility Fee Rate" for any
day are the respective  percentages  set forth below in the applicable row under
the column corresponding to the Status that exists on such day:


              Level   Level     Level    Level     Level     Level    Level
  Status        I       II       III      IV         V         VI      VII
----------- -------- --------- -------- --------- --------- -------- -------

Euro-Dollar  0.13%    0.15%     0.17%    0.20%     0.225%    0.30%    0.50%
Margin
----------- -------- --------- -------- --------- --------- -------- -------

CD Margin    0.255%   0.275%    0.295%   0.325%    0.35%     0.425%   0.625%
----------- -------- --------- -------- --------- --------- -------- -------

Facility     0.07%    0.075%    0.08%    0.10%     0.125%    0.15%    0.25%
Fee Rate
----------- -------- --------- -------- --------- --------- -------- -------

               For  purposes  of this  Schedule,  the  following  terms have the
following meanings, subject to the concluding paragraph of this schedule:

               "Level  I  Status"  exists  at any  date if,  at such  date,  the
Company's  long-term  debt is  rated  A+ or  higher  by S&P or A1 or  higher  by
Moody's.

               "Level II Status"  exists at any date if, at such  date,  (i) the
Company's  long-term debt is rated A or higher by S&P or A2 or higher by Moody's
and (ii) Level I Status does not exist.

               "Level III Status"  exists at any date if, at such date,  (i) the
Company's long-term debt is rated A- or higher by S&P or A3 or higher by Moody's
and (ii) neither Level I Status nor Level II Status exists.

               "Level IV Status"  exists at any date if, at such  date,  (i) the
Company's  long-term  debt is rated  BBB+ or higher by S&P and Baa1 or higher by
Moody's  and (ii)  none of Level I Status,  Level II Status or Level III  Status
exists.

               "Level V Status"  exists at any date if,  at such  date,  (i) the
Company's  long-term  debt is rated  BBB or  higher by S&P and Baa2 or higher by
Moody's  and (ii) none of Level I Status,  Level II Status,  Level III Status or
Level IV Status exists.

               "Level VI Status"  exists at any date if, at such  date,  (i) the
Company's  long-term debt is rated BBB- by S&P and Baa3 by Moody's and (ii) none
of Level I Status, Level II Status, Level III Status, Level IV Status or Level V
Status exists.

               "Level VII Status"  exists at any date if, at such date, no other
Status exists.

               "Status" refers to the  determination of which of Level I Status,
Level II Status,  Level III Status,  Level IV Status,  Level V Status,  Level VI
Status or Level VII Status exists at any date.

               The credit  ratings to be utilized for purposes of this  Schedule
are those  assigned to the senior  unsecured  long-term  debt  securities of the
Company without third-party credit  enhancement,  and any rating assigned to any
other debt security of the Company shall be disregarded. The rating in effect at
any date is that in effect at the close of business on such date.

               If the Company's debt securities are rated by only one of Moody=s
and S&P, Status shall be determined  based on the rating assigned by that rating
agency. For purposes of determining if Level I Status,  Level II Status or Level
III Status exists, if the Company is split-rated and the ratings differential is
one level,  the higher of the two ratings will apply (e.g.,  A-/Baa1  results in
Level III  Status,  but  A-/Baa2  results in Level V Status).  If the Company is
split-rated and the ratings  differential is more than one level,  the rating at
the  midpoint  (or the  higher of the two  intermediate  ratings  if there is no
midpoint) will apply (e.g., A+/A3 results in Level II Status).





                                                                CONFORMED COPY


                             WAIVER AND AMENDMENT NO. 1 TO
                      AMENDED AND RESTATED CREDIT AGREEMENT

        WAIVER AND  AMENDMENT  NO. 1 dated as of January 1, 1998 to the  Amended
and Restated Credit Agreement (the "Restated Agreement") dated as of December 4,
1996 among Kerr-McGee Corporation (the "Company"), Kerr-McGee Credit Corporation
("Credit  Corporation"),  the Banks listed on the  signature  pages thereof (the
"Banks") and Morgan Guaranty Trust Company of New York, as Agent (the "Agent").

                                  W I T N E S S E T H :

        WHEREAS, Credit Corporation desires to consummate a merger, effective as
of the date hereof,  with Kerr-McGee  Credit LLC, a Delaware  limited  liability
company  ("Credit LLC"),  in which Credit LLC will be the surviving  company and
will  assume  all  of  Credit  Corporation=s  obligations,   including,  without
limitation, all obligations under the Restated Agreement (the "Merger");

        WHEREAS,  in connection  with such Merger,  the parties hereto desire to
waive  and amend  certain  provisions  of the  Restated  Agreement  as set forth
herein;

        NOW, THEREFORE, the parties hereto agree as follows:

        SECTION  1.  Definitions;   References.  Unless  otherwise  specifically
defined  herein,  each  capitalized  term used  herein  which is  defined in the
Restated  Agreement shall have the meaning assigned to such term in the Restated
Agreement.  Each reference to Ahereof",  Ahereunder",  Aherein" and Ahereby" and
each other similar  reference and each  reference to Athis  Agreement"  and each
other similar reference contained in the Restated Agreement shall from and after
the date hereof refer to the  Restated  Agreement  as amended  hereby.  The term
ANotes@ defined in the Restated  Agreement shall include from and after the date
hereof the LLC Notes (as defined below).

        SECTION 2.  Waiver.  Notwithstanding  that  Section 5.04 of the Restated
Agreement  requires each Material  Subsidiary to preserve and keep in full force
and effect its  corporate  existence,  each of the Banks hereby  agrees to waive
such  requirement  insofar  as, and only to the extent  that,  such  requirement
applies to Credit  Corporation.  The parties hereto agree that the occurrence of
the Merger shall not result in a Default under the Restated Agreement.

        SECTION 3.  Amendment of Section 1.01. (a) The following new definitions
are added in alphabetical order to Section 1.01 of the Restated Agreement:

        "Credit  LLC" means Credit  Corporation,  together  with its  successors
(including  Kerr-McGee  Credit LLC, a Delaware limited liability  company,  upon
consummation of the Merger).

        "Merger" means the merger of Credit Corporation with and into Kerr-McGee
Credit LLC (with Kerr-McGee  Credit LLC as the surviving Person) pursuant to the
Merger Agreement, effective as of January 1, 1998.

        "Merger  Agreement"  means the  Agreement of Merger dated as of December
29, 1997 between Credit Corporation and Kerr-McGee Credit LLC.

       (b) The definition of "Credit  Corporation"  set forth in Section 1.01 of
the Restated Agreement is amended by deleting the phrase ", and its successors."

        (c)  Each  reference  to  "Credit  Corporation"  in the  definitions  of
"Borrower",  "Lien" and "Material  Subsidiary"  set forth in Section 1.01 of the
Restated Agreement is amended to read "Credit LLC."

        SECTION 4.  Amendment  of Section  4.01.  Section  4.01 of the  Restated
Agreement is amended to read in its entirety as follows:

               SECTION 4.01.  Corporate and Limited  Liability Company Existence
               and  Power.  The  Company  is a  corporation  duly  incorporated,
               validly existing and in good standing under the laws of Delaware,
               and Credit LLC is a limited  liability  company  duly  organized,
               validly existing and in good standing under the laws of Delaware.
               Each of the Company and Credit LLC has all  corporate  or limited
               liability  company  power,  as the case may be, and all  material
               governmental  licenses,  authorizations,  consents and  approvals
               required to carry on its business as now conducted  which, if not
               obtained, could reasonably be expected to have a material adverse
               effect of the  business  or  operations  of the  Company  and its
               Subsidiaries considered as a whole.

        SECTION 5.  Amendment  of Section  4.02.  Section  4.02 of the  Restated
Agreement is amended to read in its entirety as follows:

               SECTION   4.02.   Corporate,   Limited   Liability   Company  and
               Governmental  Authorization;  No  Contravention.  The  execution,
               delivery  and  performance  by the Company and Credit LLC of this
               Agreement and the Notes are within such  Borrower=s  corporate or
               limited  liability  company powers, as the case may be, have been
               duly authorized by all necessary  corporate or limited  liability
               company  action,  as the case may be,  require no  approval of or
               filing with any governmental  body, agency or official and do not
               contravene  or  constitute  a  default  under  any  provision  of
               applicable   law  or   regulation  or  of  the   certificate   of
               incorporation  or by-laws or  certificate of formation or limited
               liability company agreement of such Borrower or of any agreement,
               judgment,  injunction,  order, decree or other instrument binding
               upon such Borrower or result in the creation or imposition of any
               mortgage,  security  interest or other lien or encumbrance on any
               asset of such Borrower or any of its Subsidiaries.

        SECTION 6.  Amendment  of  Section  4.03.    The  reference  to  "Credit
Corporation"  in  Section 4.03  of the Restated Agreement  is  amended  to  read
"Credit LLC."

        SECTION 7.  Amendment  of Section  4.09.  Section  4.09 of the  Restated
Agreement is amended to read in its entirety as follows:

               SECTION 4.09. Subsidiaries.  Each of the Material Subsidiaries is
               a  corporation  or  limited  liability  company  duly  organized,
               validly  existing  and in good  standing  under  the  laws of its
               jurisdiction  of  organization,  and has all corporate or limited
               liability  company powers,  as the case may be, required to carry
               on its business as now  conducted.  Each Material  Subsidiary has
               all governmental licenses, authorizations, consents and approvals
               required to carry on its business as now conducted and which,  if
               not  obtained,  could  reasonably  be expected to have a material
               adverse  effect on the business or  operations of the Company and
               its Subsidiaries considered as a whole.

        SECTION 8.  Amendment of Section 5.01 (a).   Each  reference  to "Credit
Corporation" in  Section 5.01(a) of  the  Restated  Agreement is amended to read
"Credit LLC."

        SECTION 9.  Amendment of Section 5.03.  Each reference to "corporations"
in Section 5.03 of the Restated Agreement is amended to read "companies."

        SECTION 10.  Amendment  of Section  5.04.  Section  5.04 of the Restated
Agreement  is amended by (i)  deleting  the  parenthetical  "(other  than Credit
Corporation)"  and  substituting  therefor  "(other than Credit LLC)";  and (ii)
amending each reference to "corporate  existence" to read  "corporate or limited
liability company existence, as the case may be."

        SECTION 11.  Amendment  of Section  5.11.  Section  5.11 of the Restated
Agreement is amended to read in its entirety as follows:

               SECTION  5.11.  Ownership  of Credit LLC. The Company will at all
               times (i) be the sole member of Credit LLC and (ii) own, directly
               or  indirectly,   all  outstanding   limited   liability  company
               interests  and other equity  securities  of Credit LLC,  free and
               clear of any Lien.

        SECTION 12. Amendment of Sections 9.01, 9.02, 9.03, 9.04, 9.05 and 9.06.
Each reference to "Credit  Corporation" in Sections 9.01, 9.02, 9.03, 9.04, 9.05
and 9.06 of the Restated Agreement is amended to read "Credit LLC."

        SECTION 13.  Assumption of  Obligations  by Credit LLC. With effect from
and  including  the date this Waiver and  Amendment  No. 1 becomes  effective in
accordance  with  Section  17  hereof,  (i)  Credit  LLC shall be a party to the
Restated Agreement and (ii) Credit LLC expressly assumes,  and agrees to perform
and discharge,  all of the  obligations  and  liabilities of Credit  Corporation
under the Restated Agreement.

        SECTION 14.  Representations  and   Warranties.   Each  Borrower  hereby
represents  and  warrants  that  as  of  the date hereof and after giving effect
hereto:

       (a)   no Default has occurred and is continuing; and

       (b) each  representation  and warranty of such  Borrower set forth in the
Restated Agreement is true and correct as though made on and as of this date.

        SECTION 15.  Governing Law.  This  Waiver and  Amendment  No. 1 shall be
governed by and construed in accordance with the laws of the State of New York.

        SECTION 16.  Effect of Waiver and  Amendment.  Except as  expressly  set
forth herein,  this Waiver and Amendment No. 1 shall not  constitute a waiver or
amendment of any term or condition of the Restated Agreement, and all such terms
and conditions shall remain in full force and effect and are hereby ratified and
confirmed in all respects.

        SECTION 17. Counterparts; Effectiveness. This Waiver and Amendment No. 1
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures  thereto and hereto were upon the same
instrument.  This Waiver and  Amendment  No. 1 shall become  effective as of the
date hereof when (i) the Agent shall have received  duly  executed  counterparts
hereof signed by each of the parties  hereto (or, in the case of any party as to
which an executed counterpart shall not have been received, the Agent shall have
received  telegraphic,  telex or other written  confirmation  from such party of
execution  of a  counterpart  hereof by such  party);  (ii) the Agent shall have
received a Note duly executed by Credit LLC for each of the Banks (collectively,
the "LLC  Notes"),  dated on or  before  the date of  effectiveness  hereof  and
otherwise in compliance with Section 2.05 of the Restated  Agreement;  (iii) the
Agent shall have  received an opinion of the General  Counsel of the Company (or
such  other  counsel  for  the  Borrower  as may be  acceptable  to the  Agent),
substantially in the form of Exhibit E to the Restated  Agreement (and expressly
including an opinion  under the  Delaware  Limited  Liability  Company Act) with
reference to Credit LLC, the LLC Notes,  this Waiver and Amendment No. 1 and the
Restated Agreement as amended hereby; and (iv) the Agent shall have received all
documents it may reasonably request relating to the existence of Credit LLC, the
corporate and limited  liability  company  authority for and the validity of the
Restated  Agreement  as  amended  hereby,  the LLC Notes  and any other  matters
relevant hereto, all in form and substance satisfactory to the Agent.


        IN WITNESS  WHEREOF,  the  parties  hereto  have  caused this Waiver and
Amendment No. 1 to be duly executed by their respective  authorized  officers as
of the day and year first above written.


                             KERR-McGEE CORPORATION


                             By /s/ John C. Linehan
                                Title: Executive Vice President


                             By /s/ John M. Rauh
                                Title: Vice President


                             KERR-McGEE CREDIT LLC, as successor
                             in interest to Kerr-McGee Credit Corporation


                             By /s/ John C. Linehan
                                Title: Executive Vice President

                             123 Robert S. Kerr Avenue
                             Oklahoma City, Oklahoma 73102


                             MORGAN GUARANTY TRUST COMPANY
                                 OF NEW YORK


                             By /s/ James S. Finch
                                Title: Vice President


                             THE FIRST NATIONAL BANK OF CHICAGO


                             By /s/ Ronald L. Dierker
                                Title: Authorized Agent


                             CITIBANK, N.A.


                             By /s/ Mark Stanfield Packard
                                Title: Assistant Vice President


                             NATIONSBANK OF TEXAS, N.A.


                             By /s/ Dale T. Wilson
                                Title: Vice President


                             ROYAL BANK OF CANADA


                             By /s/ Linda M. Stephens
                                Title:  Manager


                             TEXAS COMMERCE BANK NATIONAL
                                 ASSOCIATION


                             By /s/ Donna J. German
                                Title: Senior Vice President


                             THE BANK OF NEW YORK


                             By /s/ Raymond J. Palmer
                                Title: Vice President


                             MELLON BANK, N.A.


                             By /s/ Richard A. Matthews
                                Title: Vice President


                             UMB OKLAHOMA BANK


                             By /s/ David Schaefer
                                Title: Executive Vice President


                             WACHOVIA BANK, N.A.


                             By /s/ Mariel C. Albrecht
                                Title: Assistant Vice President



                             MORGAN GUARANTY TRUST COMPANY
                                 OF NEW YORK, as Agent


                             By /s/ James S. Finch
                                Title: Vice President