FIRST AMENDMENT TO POST-PETITION CREDIT AGREEMENT

     This FIRST AMENDMENT TO POST-PETITION  CREDIT AGREEMENT (this  "Agreement")
is  entered  into as of this 25th day of  August,  2004,  by and among  KEYSTONE
CONSOLIDATED  INDUSTRIES,  INC. ("Keystone"),  DESOTO ENVIRONMENTAL  MANAGEMENT,
INC., FV STEEL AND WIRE COMPANY,  J.L.  PRESCOTT  COMPANY,  SHERMAN WIRE COMPANY
(f/k/a DESOTO,  INC.), and SHERMAN WIRE OF CALDWELL,  INC., each as a debtor and
debtor-in-possession  in the  Cases  (defined  below)  (each  a  "Debtor,"  and,
collectively,  the "Debtors"),  and CONGRESS FINANCIAL CORPORATION (CENTRAL), as
lender ("Lender"). Unless otherwise specified, the capitalized terms used herein
shall  have  the  meanings  ascribed  to them in the  Assumption  Agreement  and
Amendment (defined below).

                                    RECITALS

     A. Keystone,  as  pre-petition  debtor,  and Lender are parties to (i) that
certain Amended and Restated Revolving Loan and Security Agreement,  dated as of
December 29, 1995 (as amended,  modified,  restated or supplemented prior to the
date hereof, the "Pre-Petition Credit Agreement"),  and (ii) the other Financing
Agreements,  as defined in the Pre-Petition Credit Agreement (all such Financing
Agreements,  together with the Pre-Petition  Credit  Agreement,  in each case as
amended,  modified,  restated or supplemented prior to the date hereof or by any
other  amendment  executed  on or  after  the  date  hereof,  collectively,  the
"Original Financing Agreements").

     B. Debtors have filed  petitions for relief under chapter 11 of title 11 of
the United States Code, 11 U.S.C.  ss.ss. 101, et seq. (the "Bankruptcy  Code"),
in the United States Bankruptcy Court for the Eastern District of Wisconsin (the
"Bankruptcy  Court"),  on  February  26,  2004 (the  "Petition  Date"),  Jointly
Administered Case No. 04-22421-SVK (the "Cases").

     C. The  commencement  of the Cases  constituted  an Event of Default  under
Section 10.1(g) the Pre-Petition Credit Agreement.

     D. In order to continue their operations as debtors-in-possession under the
Bankruptcy  Code, the Debtors  requested  that Lender make certain  postpetition
secured  loans to Keystone (the "DIP  Financing").  Lender has provided such DIP
Financing to Keystone on and after the Petition  Date  pursuant to the terms and
conditions of (a) the Assumption Agreement and Amendment to Financing Agreements
entered  into as of  February  27,  2004 by and among the Lender and the Debtors
(the  "Assumption  Agreement  and  Amendment"),   (b)  the  Pre-Petition  Credit
Agreement  and the other  Original  Financing  Agreements,  as  modified  by the
Assumption  Agreement and  Amendment  (the  Pre-Petition  Credit  Agreement,  as
modified by the Assumption  Agreement and Amendment,  the "Post-Petition  Credit
Agreement")  and (c) the  Final  Order  (1)  Authorizing  Keystone  Consolidated
Industries,  Inc.,  as  Debtor-in-Possession,  to  Incur  Post-Petition  Secured
Indebtedness, (2) Granting Security Interests and Priority Pursuant to 11 U.S.C.
ss. 364 and (3)  Modifying  Automatic  Stay entered by the  Bankruptcy  Court on
March 15, 2004 (the "Financing Order").

     E.  Subject to the terms and  conditions  of this  Agreement  and the other
agreements  executed in connection  herewith,  if any,  Lender has agreed to the
Post-Petition Credit Agreement as set forth herein.

     NOW,  THEREFORE,  in  consideration  of the  foregoing,  the  covenants and
conditions  contained  herein and other  good and  valuable  consideration,  the
receipt and  sufficiency  of which are hereby  acknowledged,  the parties hereto
agree as follows:

     SECTION 1. Amendments.

     (a) Subsection 1.49 of the Post-Petition Credit Agreement is hereby amended
to insert the  following  immediately  following  the last  sentence of existing
subsection 1.49 of the Post-Petition Credit Agreement:

     "Notwithstanding  any of the  foregoing,  in any month in which Borrower at
     all times would be permitted  to obtain from Lender a Revolving  Loan in an
     amount not less than  $10,000,000 in excess of any and all Revolving  Loans
     outstanding  at such time after giving  effect to the lending  formulas set
     forth in Section  2.1(a)  hereof,  the  Interest  Rate shall mean (A) as to
     Prime Rate Loans,  a rate of  one-half  of one percent  (0.5%) per annum in
     excess of the Prime Rate and (B) as to Eurodollar Rate Loans, a rate of two
     and  one-half  of one  percent  (2.5%)  percent  per annum in excess of the
     Adjusted  Eurodollar  Rate (based on the Eurodollar Rate applicable for the
     Interest  Period  selected by Borrower as in effect three (3) Business Days
     after the date of receipt by Lender of the  request  of  Borrower  for such
     Eurodollar  Rate Loans in accordance  with the terms  hereof,  whether such
     rate is  higher or lower  than any rate  previously  quoted  to  Borrower);
     provided, that, during any such month the Interest Rate shall mean the rate
     of two and one-half of one percent  (2.5%) per annum in excess of the Prime
     Rate as to  Prime  Rate  Loans  and the rate of four  and  one-half  of one
     percent  (4.5%) per annum in excess of the Adjusted  Eurodollar  Rate as to
     Eurodollar Rate Loans,  at Lender's  option,  without  notice,  (a) for the
     period (i) from and after the date of  termination  or  non-renewal  hereof
     until  Lender  has  received  full and  final  payment  of all  obligations
     (notwithstanding  entry of a judgment  against  Borrower) and (ii) from and
     after the date of the occurrence of an Event of Default for so long as such
     Event of Default is  continuing  as  determined  by Lender,  and (b) on the
     Revolving Loans at any time outstanding in excess of the amounts  available
     to Borrower under Section 2 (whether or not such  excess(es),  arise or are
     made with or without Lender's  knowledge or consent and whether made before
     or after an Event of Default)."

     SECTION 2.  Representations  and Warranties of Debtors. To induce Lender to
execute and deliver this Agreement, Debtors represent and warrant that:

     (a) The  execution,  delivery and  performance by Debtors of this Agreement
and all  documents  and  instruments  delivered in  connection  herewith and the
Post-Petition Credit Agreement and all other Financing Agreements have been duly
authorized,  executed and  delivered,  and this  Agreement and all documents and
instruments  delivered  in  connection  herewith  and the  Post-Petition  Credit
Agreement  and all other  Financing  Agreements  are  legal,  valid and  binding
obligations of Debtors that are a party thereto, enforceable against the Debtors
in accordance with its respective terms,  except as the enforcement  thereof may
be  subject  to  (i)  the  effect  of  any  applicable  bankruptcy,  insolvency,
reorganization,  moratorium or similar law affecting creditors' rights generally
and (ii) general principles of equity (regardless of whether such enforcement is
sought in a proceeding in equity or at law);

     (b) No Default or Event of Default has occurred and is continuing  and each
of the  representations  and warranties  contained in the  Post-Petition  Credit
Agreement and the other Financing Agreements is true and correct in all material
respects on and as of the date hereof as if made on the date  hereof,  except to
the extent  that such  representations  and  warranties  expressly  relate to an
earlier date, in which case such  representations  and warranties  shall be true
and correct as of such earlier date, and each of the agreements and covenants in
the Financing Agreements are hereby reaffirmed with the same force and effect as
if each were separately stated herein and made as of the date hereof;

     (c) Neither the execution,  delivery and  performance of this Agreement and
all  documents  and  instruments   delivered  in  connection  herewith  nor  the
consummation of the  transactions  contemplated  hereby or thereby does or shall
contravene,  result in a breach of, or violate (i) any  provision  of any of the
Debtors' governing documents, (ii) any law or regulation, or any order or decree
of any court or government  instrumentality  or (iii) any  indenture,  mortgage,
deed of trust,  lease,  agreement or other  instrument  to which any Debtor is a
party or by which any Debtor or any of its property is bound;

     (d)  Lender's  security  interests in the  Collateral  and the Congress DIP
Collateral (as defined in the Financing  Order)  continue to be valid,  binding,
and enforceable  first-priority  security interests which secure the Obligations
(subject  only to  encumbrances  permitted  by Section 9.8 of the  Post-Petition
Credit Agreement and ordering paragraph 6 of the Financing Order); and

     (e) No Debtor  has made or agreed  to make at any time any  payment  to any
other Person on account of the  transactions  contemplated  by this Agreement or
any other  agreements  related  thereto or required to be executed and delivered
thereby,  including,  but  not  limited  to,  any  holders  of the  Subordinated
Indebtedness.  No Debtor nor any  Affiliate  thereof has any  obligation  to any
Person in respect of any  finder's or  brokerage  fees in  connection  with this
Agreement or any other agreements related thereto or required to be executed and
delivered thereby.

     SECTION 3. Reference to and Effect Upon the Post-Petition Credit Agreement.

     (a) Except as expressly set forth herein, all terms, conditions, covenants,
representations and warranties  contained in the Post-Petition  Credit Agreement
or any other Financing  Agreement,  and all rights of Lender and all Obligations
of Debtors  thereunder,  shall remain in full force and effect.  Debtors  hereby
confirm  that  the  Post-Petition  Credit  Agreement  and  the  other  Financing
Agreements  are in full  force and  effect and that  Debtors  have no  defenses,
setoffs or  counterclaims  to the  Obligations  under the  Post-Petition  Credit
Agreement or any other Financing Agreement.

     (b) Except as  expressly  set forth  herein,  the  execution,  delivery and
effectiveness  of this  Agreement  and any consents and waivers set forth herein
shall not directly or indirectly (i) constitute a consent or waiver of any past,
present or future  violations  of any  provisions  of the  Post-Petition  Credit
Agreement or any other Financing  Agreement,  (ii) amend, modify or operate as a
waiver of any  provision  of the  Post-Petition  Credit  Agreement  or any other
Financing Agreement or any right, power or remedy of Lender thereunder, or (iii)
constitute a course of dealing or other basis for altering  any  Obligations  of
Debtors under the Financing Agreements or any other contract or instrument.

     (c) This Agreement shall constitute a Financing Agreement.

     SECTION 4. Costs and Expenses.  Debtors agree to promptly  reimburse Lender
on  demand  for all fees,  costs and  expenses  (including  the fees,  costs and
expenses  of counsel or other  consultants  or  advisors  retained by Lender) in
connection with the negotiation,  preparation and consummation of this Agreement
and the other agreements and documents  executed in connection  herewith and the
transactions contemplated hereby and thereby.

     SECTION 5.  Governing Law. Any dispute  between Lender and Debtors  arising
out  of,  connected  with,   related  to,  or  incidental  to  the  relationship
established between them in connection with this Agreement,  and whether arising
in contract, tort, equity or otherwise, shall be resolved in accordance with the
internal  laws  (and  not the  conflicts  of law  provisions)  of the  State  of
Illinois.

     SECTION 6. Headings. Section headings in this Agreement are included herein
for  convenience  of  reference  only and  shall not  constitute  a part of this
Agreement for any other purposes.

     SECTION  7.  Construction.  This  Agreement  and all other  agreements  and
documents executed in connection  therewith have been prepared through the joint
efforts of all of the parties.  Neither the  provisions of this Agreement or any
such  other  agreements  and  documents  nor  any  alleged  ambiguity  shall  be
interpreted  or  resolved  against  any party on the  ground  that such  party's
counsel drafted this Agreement or such other agreements and documents,  or based
on any other rule of strict construction.  Each of the parties hereto represents
and declares  that such party has  carefully  read this  Agreement and all other
agreements and documents executed in connection  therewith,  and that such party
knows the  contents  thereof  and signs the same  freely  and  voluntarily.  The
parties hereby  acknowledge  that they have been represented by legal counsel of
their own choosing in negotiations for and preparation of this Agreement and all
other agreements and documents executed in connection therewith and that each of
them has read the same and had their  contents  fully  explained by such counsel
and is fully aware of their contents and legal effect.

     SECTION 8.  Counterparts.  This  Agreement may be executed in any number of
counterparts,  each of which when so executed  shall be deemed an original,  but
all such  counterparts  shall  constitute one and the same  instrument,  and all
signatures need not appear on any one counterpart.  Any party hereto may execute
and  deliver  a  counterpart  of  this  Agreement  by  delivering  by  facsimile
transmission a signature page of this  Agreement  signed by such party,  and any
such  facsimile  signature  shall be treated in all  respects as having the same
effect as an original signature.  Any party delivering by facsimile transmission
a counterpart  executed by it shall promptly  thereafter also deliver a manually
signed counterpart of this Agreement.

     SECTION 9. Severability. The invalidity, illegality, or unenforceability of
any provision in or obligation  under this Agreement in any  jurisdiction  shall
not affect or impair the validity,  legality, or enforceability of the remaining
provisions  or  obligations  under  this  Agreement  or  of  such  provision  or
obligation in any other jurisdiction.

     SECTION  10.  Time Of  Essence.  Time is of the  essence in the payment and
performance of each of the obligations of Debtors  hereunder and with respect to
all conditions to be satisfied by Debtors.

     SECTION 11. Further  Assurances.  Debtors agree to take all further actions
and  execute all further  documents  as Lender may from time to time  reasonably
request to carry out the transactions contemplated by this Agreement.

     SECTION 12.  Notices.  All  notices,  requests,  and demands to or upon the
respective  parties hereto shall be given in accordance with Section 12.2 of the
Post-Petition Credit Agreement.

     SECTION 13.  Effectiveness.  This Agreement  shall become  effective at the
time (the "Effective Date") that all of the following  conditions precedent have
been met (or waived) as determined by Agent in its sole discretion:

     (a) Agreement. Executed signature pages for this Agreement signed by Lender
and each of the Debtors shall have been delivered to Lender.

     (b) Bankruptcy  Court Approval.  The Bankruptcy  Court shall have entered a
final nonappealable order in form and substance  acceptable to the Lender in the
Lender's sole discretion approving this Agreement and authorizing the Debtors to
execute this Agreement.

     (c)  Representations.  The representations and warranties  contained herein
shall be true and  correct in all  respects,  and no Event of Default or Default
shall exist on the date hereof.

     (d)  Other  Proceedings.  All  proceedings  taken  in  connection  with the
transactions contemplated by this Agreement and all documents,  instruments, and
other legal matters  incident  thereto shall be  satisfactory  to Lender and its
respective legal counsel.

     SECTION 14. Waiver Of Jury Trial.  DEBTORS AND LENDER WAIVE, TO THE FULLEST
EXTENT  PERMITTED  BY LAW,  ANY  RIGHT  THEY  MAY HAVE TO A TRIAL BY JURY OF ANY
CLAIM,  COUNTERCLAIM,  ACTION OR OTHER  PROCEEDING  ARISING UNDER OR RELATING TO
THIS AGREEMENT.

     SECTION 15. No Third Party  Beneficiaries.  This Agreement shall be binding
upon and inure to the benefit of Debtors, Lender and their respective successors
and  assigns.  No Person  other than the  parties  hereto  shall have any rights
hereunder  or be  entitled  to  rely  on this  Agreement,  and  all  third-party
beneficiary rights are hereby expressly disclaimed.



<PAGE>


     IN WITNESS WHEREOF,  this Agreement has been executed by the parties hereto
as of the date first written above.



                 KEYSTONE CONSOLIDATED INDUSTRIES, INC., as
                 debtor-in-possession

                 By:
                     -------------------------------------------------

                 Name:
                       -----------------------------------------------

                 Title:
                        ----------------------------------------------



                 DESOTO ENVIRONMENTAL MANAGEMENT, INC., as
                 debtor-in-possession

                 By:
                     -------------------------------------------------

                 Name:
                       -----------------------------------------------

                 Title:
                        ----------------------------------------------



                 FV STEEL AND WIRE COMPANY, as debtor-in-possession

                 By:
                     -------------------------------------------------

                 Name:
                       -----------------------------------------------

                 Title:
                        ----------------------------------------------



                J.L. PRESCOTT COMPANY, as
                debtor-in-possession

                      By:
                          -------------------------------------------------

                      Name:
                            -----------------------------------------------

                      Title:
                             ----------------------------------------------



                      SHERMAN WIRE COMPANY (f/k/a DESOTO, INC.), as
                      debtor-in-possession

                      By:
                          -------------------------------------------------

                      Name:
                            -----------------------------------------------

                      Title:
                             ----------------------------------------------



                      SHERMAN WIRE OF CALDWELL, INC., as debtor-in-possession

                      By:
                          -------------------------------------------------

                      Name:
                            -----------------------------------------------

                      Title:
                             ----------------------------------------------



                      CONGRESS FINANCIAL CORPORATION (CENTRAL), as Lender

                      By:
                          -------------------------------------------------

                      Name:
                            -----------------------------------------------

                      Title:
                             ----------------------------------------------