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                       FIRST AMENDMENT TO CREDIT AGREEMENT

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                                      among

                             LILLY INDUSTRIES, INC.

                             an Indiana corporation


                          the Lenders Signatory Hereto


                                       and


                            NBD Bank, N.A., as Agent




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                           Dated as of April 14, 1998


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                                TABLE OF CONTENTS


PART I.     AMENDATORY PROVISIONS............................................1

                  SECTION 1         Definitions............................. 1
                                    1.1     Defined Terms................... 1

                  SECTION 3         Change in Circumstances................. 4
                                    3.4.  Funding Indemnification........... 4

PART II.   CONTINUING EFFECT................................................ 4

PART III.  INDEPENDENT CREDIT DECISION...................................... 5

PART IV.   CONDITIONS PRECEDENT.............................................5 g


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                       FIRST AMENDMENT TO CREDIT AGREEMENT


         THIS FIRST  AMENDMENT  made as of the 14th day of April,  1998,  by and
among LILLY  INDUSTRIES,  INC., an Indiana  corporation  (the  "Borrower"),  the
LENDERS party hereto,  and NBD BANK,  N.A., a national banking  association,  as
agent for the Lenders hereunder (in such capacity, the "Agent");

                              W I T N E S S E T H:

         WHEREAS,  as of October 24,  1997,  the parties  hereto  entered into a
certain Credit Agreement (the "Agreement"); and

         WHEREAS,  the Borrower has requested changes in the method in which the
commitment fee and the incremental  margin are calculated and in the calculation
of break funding  charges and the Lenders have consented to such changes subject
to and as provided in this First Amendment;

         NOW,  THEREFORE,  in  consideration  of the  premises,  and the  mutual
promises herein contained, the parties agree that the Agreement shall be, and it
hereby is, amended as provided herein and the parties further agree as follows:


                          PART I. AMENDATORY PROVISIONS


                                    SECTION 1

                                   Definitions

1.1      Defined Terms.

         Section 1.1 of the  Agreement  is hereby  amended by  substituting  the
following definitions in lieu of the like existing definitions:

                  "Applicable  Commitment  Fee"  means,  on any  date,  the  fee
         payable to the Agent for the pro rata benefit of the Lenders, which fee
         shall be based upon the  Ratings in effect at the close of  business on
         such date in accordance with the table set forth below:








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                                    Ratings            Applicable Commitment Fee

         Level 1           BB or lower by S&P;                   0.250%
                           Ba2 or lower by Moody's

         Level 2           BB+ by S&P;                           0.175%
                           Ba1 by Moody's

         Level 3           BBB- by S&P;                          0.150%
                           Baa3 by Moody's

         Level 4           BBB by S&P;                           0.125%
                           Baa2 by Moody's

         Level 5           BBB+ or higher by S&P;                0.100%
                           Baa1 or higher by Moody's

         For purposes of the  foregoing,  (a) if both S&P and Moody's  shall not
         have in effect a Rating,  then the  Applicable  Commitment Fee shall be
         determined  based on the last  applicable  Level  (subject  to the last
         sentence  of this  definition),  (b) if the  Ratings  shall fall within
         different Levels, the Applicable Commitment Fee shall be based upon the
         higher of the two Ratings,  provided that if the split is more than one
         full Level,  the average  (or the higher of two  intermediate  Ratings)
         shall be used,  and (c) if any Rating shall be changed (other than as a
         result  of a change  in the  rating  system  of the  applicable  Rating
         Agency),  such change  shall be effective as of the date on which it is
         first announced by the Rating Agency making such change.  If the rating
         system of any Rating Agency shall change, or if any Rating Agency shall
         cease to be in the business of rating  corporate  debt  obligations  or
         shall not have in effect a Rating,  the parties hereto shall  negotiate
         in good faith to amend this  definition to reflect such changed  rating
         system or the absence of such Rating,  and pending the effectiveness of
         any such  amendment the  Applicable  Commitment Fee shall be determined
         (y) by  reference to the Rating from the other  Rating  Agency,  or (z)
         based on the last applicable Level for a period of ninety (90) days and
         based on Level 1 as of the expiration of such ninety (90) day period in
         the event both Rating Agencies have so changed their rating systems, or
         have  both  ceased  to be in the  business  of  rating  corporate  debt
         obligations, or both shall not have in effect a Rating.

                  "Applicable Margin" means, on any date, the incremental margin
         to be paid by Borrower on Loans hereunder,  which margin shall be based
         upon the  Ratings  in effect at the close of  business  on such date in
         accordance with the table set forth below:






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                                    Ratings              Applicable Margin

                                                       ABR Loans   Eurodollar
                                                                      Loans

         Level 1           BB or lower by S&P;             0%         0.75%
                           Ba2 or lower by Moody's                
                                                                  
         Level 2           BB+ by S&P;                     0%         0.60%
                           Ba1 by Moody's                         
                                                                  
         Level 3           BBB- by S&P;                    0%         0.45%
                           Baa3 by Moody's                        
                                                                  
         Level 4           BBB by S&P;                     0%         0.35%
                           Baa2 by Moody's                        
                                                                  
         Level 5           BBB+ or higher by S&P;          0%         0.30%
                           Baa1 or higher by Moody's              
                                                                
         For purposes of the  foregoing,  (a) if both S&P and Moody's  shall not
         have in effect a Rating,  then the  Applicable  Commitment Fee shall be
         determined  based on the last  applicable  Level  (subject  to the last
         sentence  of this  definition),  (b) if the  Ratings  shall fall within
         different Levels, the Applicable Commitment Fee shall be based upon the
         higher of the two Ratings,  provided that if the split is more than one
         full Level,  the average  (or the higher of two  intermediate  Ratings)
         shall be used,  and (c) if any Rating shall be changed (other than as a
         result  of a change  in the  rating  system  of the  applicable  Rating
         Agency),  such change  shall be effective as of the date on which it is
         first announced by the Rating Agency making such change.  If the rating
         system of any Rating Agency shall change, or if any Rating Agency shall
         cease to be in the business of rating  corporate  debt  obligations  or
         shall not have in effect a Rating,  the parties hereto shall  negotiate
         in good faith to amend this  definition to reflect such changed  rating
         system or the absence of such Rating,  and pending the effectiveness of
         any such  amendment the  Applicable  Commitment Fee shall be determined
         (y) by  reference to the Rating from the other  Rating  Agency,  or (z)
         based on the last applicable Level for a period of ninety (90) days and
         based on Level 1 as of the expiration of such ninety (90) day period in
         the event both Rating Agencies have so changed their rating systems, or
         have  both  ceased  to be in the  business  of  rating  corporate  debt
         obligations, or both shall not have in effect a Rating.

         Section 1.1 of the  Agreement is hereby  further  amended by adding the
following definitions:

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



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                  "S&P" means Standard & Poor's Ratings Services,  a division of
         McGraw-Hill Companies, Inc.

                  "Rating Agencies" means Moody's and S&P.

                  "Ratings"  means the ratings from time to time  established by
         the  Rating   Agencies  for  senior,   unsecured,   non-credit-enhanced
         long-term debt of the Borrower.


                                    SECTION 3

                             Change in Circumstances

         3.4.  Funding  Indemnification.  Section 3.4 of the Agreement is hereby
amended by  substituting  the following  sentence in lieu of the existing  third
(3rd) sentence of Section 3.4:

         In the event of a prepayment,  the  calculation of the cost owed to the
         Lenders under this Section 3.4 would be calculated  using the following
         formula:

                            Cost = PA x (OCF-RR) x D
                            ------------------------
                                       360

         where  PA  is  the  principal  amount  prepaid,  OCF  is  the  original
         Eurodollar  Rate  applicable to such  prepayment,  RR is the Eurodollar
         Base  Rate  determined  by the Agent at the time of  prepayment  for an
         interest  period  substantially  as  similar  as  possible  to the time
         remaining until expiration of the applicable Eurodollar Interest Period
         that  is  subject  to the  prepayment,  and D is  the  number  of  days
         remaining in the applicable  Eurodollar Interest Period that is subject
         to the prepayment.


                           PART II. CONTINUING EFFECT

         Except as expressly modified herein:

                  (a) All terms,  conditions,  representations,  warranties  and
         covenants  contained in the  Agreement  shall remain the same and shall
         continue in full force and effect, interpreted, wherever possible, in a
         manner consistent with this First Amendment;  provided, however, in the
         event of any irreconcilable  inconsistency,  this First Amendment shall
         control;

                  (b)  The  representations  and  warranties  contained  in  the
         Agreement  shall survive this First Amendment in their original form as
         continuing representations and warranties of the Borrower; and



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                  (c) Capitalized  terms used in this First  Amendment,  and not
         specifically  herein defined,  shall have the meanings ascribed to them
         in the Agreement.

In consideration hereof, the Borrower represents, warrants, covenants and agrees
that:

                   (aa)  Each  representation  and  warranty  set  forth  in the
         Agreement,  as hereby amended,  remains true and correct as of the date
         hereof  in all  material  respects,  except  to the  extent  that  such
         representation and warranty is expressly intended to apply solely to an
         earlier date and except changes  reflecting  transactions  permitted by
         the Agreement;

                  (bb)  There  currently  exists no  offsets,  counterclaims  or
         defenses  to  the  performance  of  the   Obligations   (such  offsets,
         counterclaims or defenses, if any, being hereby expressly waived);

                  (cc) There has not occurred any Default or Unmatured  Default;
         and

                  (dd)  After  giving  effect to this  First  Amendment  and any
         transactions contemplated hereby, no Default or Unmatured Default is or
         will be occasioned hereby or thereby.


                      PART III. INDEPENDENT CREDIT DECISION

         Each  Lender  acknowledges  that  it  has,  independently  and  without
reliance  upon the  Agent or any  other  Lender,  based  on such  documents  and
information  as it has  deemed  appropriate,  made its own credit  analysis  and
decision to enter into this First Amendment.


                          PART IV. CONDITIONS PRECEDENT

         Notwithstanding  anything  contained  in this  First  Amendment  to the
contrary,  the Lenders shall have no obligation under this First Amendment until
each  of  the  following   conditions  precedent  have  been  fulfilled  to  the
satisfaction of the Agent:

                  (a) Each of the  conditions  set forth in  Section  6.2 of the
         Agreement shall have been satisfied;

                  (b) The Agent shall have  received each of the  following,  in
         form and substance satisfactory to the Agent:

                           (i) The Loan Documents,  as amended, duly executed in
                  the form approved by the Lenders;



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                           (ii) A duly executed  certificate of the Secretary or
                  any Assistant  Secretary of the Borrower (A)  certifying as to
                  attached  copies of  Resolutions  of the Board of Directors of
                  the  Borrower   authorizing   the   execution,   delivery  and
                  performance of the Loan Documents,  as amended,  and any other
                  documents  provided  for in this First  Amendment to which the
                  Borrower is a party,  (B)  certifying the names of the officer
                  or  officers  authorized  to  sign,  respectively,   the  Loan
                  Documents, as amended, and any other documents provided for in
                  this First  Amendment  to which the  Borrower is a party,  and
                  containing  a  sample  of the  true  signature  of  each  such
                  officer,  and (C)  certifying  as  complete  and correct as to
                  attached copies of the Articles of  Incorporation  and By-Laws
                  of  the  Borrower  or   certifying   that  such   Articles  of
                  Incorporation  or  By-Laws  have not been  amended  (except as
                  shown) since the previous delivery thereof to the Agent; and

                  (c) All legal matters  incident to this First  Amendment shall
         be reasonably satisfactory to the Agent and its counsel.

         IN WITNESS WHEREOF, the Borrower, the Agent and the Lenders have caused
this First Amendment to be executed by their respective officers duly authorized
as of the date first above written.





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                                SIGNATURE PAGE OF
                             LILLY INDUSTRIES, INC.
                                       TO
                               FIRST AMENDMENT TO
                                CREDIT AGREEMENT







                                     LILLY INDUSTRIES, INC.



                                     By: /s/ John C. Elbin
                                        ----------------------------------------
                                          John C. Elbin, Chief Financial Officer
                                             and Secretary









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                                SIGNATURE PAGE OF
                                 NBD BANK, N.A.,
                                       TO
                               FIRST AMENDMENT TO
                                CREDIT AGREEMENT







                                           NBD BANK, N.A.,
                                           individually and as Agent


                                           By: /s/ Dennis L. Bassett
                                              ----------------------------

                                           Its: Senior Vice President
                                              ----------------------------



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                                SIGNATURE PAGE OF
                              BANK ONE, INDIANA, NA
                                       TO
                               FIRST AMENDMENT TO
                                CREDIT AGREEMENT








                                           BANK ONE, INDIANA, NA


                                           By: /s/ Brian D. Smith
                                              ----------------------------

                                           Its: Vice President
                                              ----------------------------

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                                SIGNATURE PAGE OF
                            FIRST UNION NATIONAL BANK
                                       TO
                               FIRST AMENDMENT TO
                                CREDIT AGREEMENT







                                           FIRST UNION NATIONAL BANK


                                           By: /s/ 
                                              ----------------------------

                                           Its: Senior Vice President
                                              ----------------------------


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                                SIGNATURE PAGE OF
                          HARRIS TRUST AND SAVINGS BANK
                                       TO
                               FIRST AMENDMENT TO
                                CREDIT AGREEMENT







                                           HARRIS TRUST AND SAVINGS BANK


                                           By: /s/ Peter Krawchuk
                                              ----------------------------

                                           Its: Vice President
                                              ----------------------------



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                                SIGNATURE PAGE OF
                          KEYBANK NATIONAL ASSOCIATION
                                       TO
                               FIRST AMENDMENT TO
                                CREDIT AGREEMENT







                                           KEYBANK NATIONAL ASSOCIATION


                                           By: /s/ Frank J. Jancar
                                              ----------------------------

                                           Its: Vice President
                                              ----------------------------

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                                SIGNATURE PAGE OF
                          NATIONAL CITY BANK OF INDIANA
                                       TO
                               FIRST AMENDMENT TO
                                CREDIT AGREEMENT







                                           NATIONAL CITY BANK OF INDIANA


                                           By: /s/ Frank B. Meltzer
                                              ----------------------------

                                           Its: Vice President
                                              ----------------------------


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                                SIGNATURE PAGE OF
                           BANK OF AMERICA N.T. & S.A.
                                       TO
                       FIRST AMENDMENT TO CREDIT AGREEMENT







                                           BANK OF AMERICA N.T. & S.A.


                                           By: /s/ Paul B. Higdon
                                               -----------------------------

                                           Its: Managing Director
                                                ----------------------------



















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