Exhibit (4)
                                                                     -----------

                                                   POST-PETITION
                                                 CREDIT AGREEMENT

                                                    Dated as of

                                                 December 8, 2000

                                                       Among

                                      THE FINANCIAL INSTITUTIONS NAMED HEREIN

                                                  as the Lenders
                                                  --------------

                                               BANK OF AMERICA, N.A.
                                                        ..

                                                   as the Agent

                                                        and

                                               OWENS CORNING AND THE
                                    SUBSIDIARIES OF OWENS CORNING NAMED HEREIN

                                                 as the Borrowers
                                                 ----------------


<PAGE>

<TABLE>
<S>                                                                                                           <C>


                                                        iii

                                                 TABLE OF CONTENTS


Article                                                                                                       Page


ARTICLE 1 LOANS AND LETTERS OF CREDIT.............................................................................0

   1.1   TOTAL FACILITY...........................................................................................0
   1.2   REVOLVING LOANS..........................................................................................0
   1.3   [INTENTIONALLY OMITTED]..................................................................................0
   1.4   LETTERS OF CREDIT........................................................................................0
   1.5   BANK PRODUCTS............................................................................................0
   1.6   JOINT AND SEVERAL LIABILITY OF BORROWERS.................................................................0

ARTICLE 2 INTEREST AND FEES.......................................................................................0

   2.1   INTEREST.................................................................................................0
   2.2   CONTINUATION AND CONVERSION ELECTIONS....................................................................0
   2.3   MAXIMUM INTEREST RATE....................................................................................0
   2.4   FACILITY FEE; SYNDICATION FEE; ADMINISTRATION FEE........................................................0
   2.5   UNUSED LINE FEE..........................................................................................0
   2.6   LETTER OF CREDIT FEE.....................................................................................0

ARTICLE 3 PAYMENTS AND PREPAYMENTS................................................................................0

   3.1   REVOLVING LOANS..........................................................................................0
   3.2   TERMINATION OF FACILITY; REDUCTIONS IN REVOLVING LOAN COMMITMENTS........................................0
   3.3   [INTENTIONALLY OMITTED.].................................................................................0
   3.4   [INTENTIONALLY OMITTED.].................................................................................0
   3.5   LIBOR RATE LOAN PREPAYMENTS..............................................................................0
   3.6   PAYMENTS BY THE BORROWERS................................................................................0
   3.7   PAYMENTS AS REVOLVING LOANS..............................................................................0
   3.8   APPORTIONMENT, APPLICATION AND REVERSAL OF PAYMENTS......................................................0
   3.9   INDEMNITY FOR RETURNED PAYMENTS..........................................................................0
   3.10     AGENT'S AND LENDERS' BOOKS AND RECORDS; MONTHLY STATEMENTS............................................0

ARTICLE 4 TAXES, YIELD PROTECTION AND ILLEGALITY..................................................................0

   4.1   TAXES....................................................................................................0
   4.2   ILLEGALITY...............................................................................................0
   4.3   INCREASED COSTS AND REDUCTION OF RETURN..................................................................0
   4.4   FUNDING LOSSES...........................................................................................0
   4.5   INABILITY TO DETERMINE RATES.............................................................................0
   4.6   CERTIFICATES OF AGENT....................................................................................0
   4.7   SURVIVAL.................................................................................................0
   4.8   AFFECTED LENDERS.........................................................................................0

ARTICLE 5 BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES.......................................................0

   5.1   BOOKS AND RECORDS........................................................................................0
   5.2   FINANCIAL INFORMATION....................................................................................0
   5.3   NOTICES TO THE LENDERS...................................................................................0

ARTICLE 6 GENERAL WARRANTIES AND REPRESENTATIONS..................................................................0

   6.1   AUTHORIZATION, VALIDITY, AND ENFORCEABILITY OF THIS AGREEMENT AND THE LOAN DOCUMENTS.....................0
   6.2   BORROWERS' ORGANIZATION AND QUALIFICATION OF BORROWERS...................................................0
   6.3   [INTENTIONALLY OMITTED.].................................................................................0
   6.4   OTHER SUBSIDIARIES AND AFFILIATES........................................................................0
   6.5   FINANCIAL STATEMENTS AND PROJECTIONS.....................................................................0
   6.6   [INTENTIONALLY OMITTED.].................................................................................0
   6.7   DEBT.....................................................................................................0
   6.8   [INTENTIONALLY OMITTED.].................................................................................0
   6.9   TITLE TO PROPERTY; LIENS.................................................................................0
   6.10     PROPRIETARY RIGHTS....................................................................................0
   6.11     [INTENTIONALLY OMITTED.]..............................................................................0
   6.12     LITIGATION............................................................................................0
   6.13     [INTENTIONALLY OMITTED.]..............................................................................0
   6.14     ENVIRONMENTAL LAWS....................................................................................0
   6.15     NO VIOLATION OF LAW...................................................................................0
   6.16     NO DEFAULT............................................................................................0
   6.17     ERISA COMPLIANCE......................................................................................0
   6.18     TAXES.................................................................................................0
   6.19     REGULATED ENTITIES....................................................................................0
   6.20     USE OF PROCEEDS; MARGIN REGULATIONS...................................................................0
   6.21     COPYRIGHTS, PATENTS, TRADEMARKS AND LICENSES, ETC.....................................................0
   6.22     FULL DISCLOSURE.......................................................................................0
   6.23     GOVERNMENTAL AUTHORIZATION............................................................................0
   6.24     SUBSIDIARY BORROWERS..................................................................................0

ARTICLE 7 AFFIRMATIVE AND NEGATIVE COVENANTS......................................................................0

   7.1   TAXES AND OTHER OBLIGATIONS..............................................................................0
   7.2   LEGAL EXISTENCE AND GOOD STANDING........................................................................0
   7.3   COMPLIANCE WITH LAW AND AGREEMENTS; MAINTENANCE OF LICENSES..............................................0
   7.4   MAINTENANCE OF PROPERTY; INSPECTION OF PROPERTY..........................................................0
   7.5   INSURANCE................................................................................................0
   7.6   ENVIRONMENTAL LAWS.......................................................................................0
   7.7   COMPLIANCE WITH ERISA....................................................................................0
   7.8   MERGERS, CONSOLIDATIONS OR SALES.........................................................................0
   7.9   DISTRIBUTIONS; CAPITAL CHANGE; RESTRICTED INVESTMENTS....................................................0
   7.10     [INTENTIONALLY OMITTED]...............................................................................0
   7.11     GUARANTIES............................................................................................0
   7.12     DEBT..................................................................................................0
   7.13     PREPAYMENT............................................................................................0
   7.14     TRANSACTIONS WITH AFFILIATES..........................................................................0
   7.15     INVESTMENT BANKING AND FINDER'S FEES..................................................................0
   7.16     BUSINESS CONDUCTED....................................................................................0
   7.17     LIENS.................................................................................................0
   7.18     [INTENTIONALLY OMITTED.]..............................................................................0
   7.19     [INTENTIONALLY OMITTED.]..............................................................................0
   7.20     FISCAL YEAR...........................................................................................0
   7.21     CONSOLIDATED EBITDA...................................................................................0
   7.22     [INTENTIONALLY OMITTED.]..............................................................................0
   7.23     USE OF PROCEEDS.......................................................................................0
   7.24     FURTHER ASSURANCES....................................................................................0
   7.25     SECTION 364(C)(1) SUPERPRIORITY ADMINISTRATIVE CLAIM.  (A)............................................0
   7.26     BORROWERS' ACCOUNTS...................................................................................0
   7.27     INVENTORY; RECORDS....................................................................................0

ARTICLE 8 CONDITIONS OF LENDING...................................................................................0

   8.1   CONDITIONS PRECEDENT TO MAKING OF INITIAL LOANS..........................................................0
   8.2   CONDITIONS PRECEDENT TO EACH LOAN........................................................................0

ARTICLE 9 DEFAULT; REMEDIES.......................................................................................0

   9.1   EVENTS OF DEFAULT........................................................................................0
   9.2   REMEDIES.................................................................................................0

ARTICLE 10 TERM AND TERMINATION...................................................................................0

   10.1     TERM AND TERMINATION..................................................................................0

ARTICLE 11 AMENDMENTS; WAIVERs; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS...........................................0

   11.1     AMENDMENTS AND WAIVERS................................................................................0
   11.2     ASSIGNMENTS; PARTICIPATIONS...........................................................................0

ARTICLE 12 THE AGENT..............................................................................................0

   12.1     APPOINTMENT AND AUTHORIZATION.........................................................................0
   12.2     DELEGATION OF DUTIES..................................................................................0
   12.3     LIABILITY OF AGENT....................................................................................0
   12.4     RELIANCE BY AGENT.....................................................................................0
   12.5     NOTICE OF DEFAULT.....................................................................................0
   12.6     CREDIT DECISION.......................................................................................0
   12.7     INDEMNIFICATION.......................................................................................0
   12.8     AGENT IN INDIVIDUAL CAPACITY..........................................................................0
   12.9     SUCCESSOR AGENT.......................................................................................0
   12.10    WITHHOLDING TAX.......................................................................................0
   12.11    [INTENTIONALLY OMITTED.]..............................................................................0
   12.12    RESTRICTIONS ON ACTIONS BY LENDERS; SHARING OF PAYMENTS...............................................0
   12.13    [INTENTIONALLY OMITTED]...............................................................................0
   12.14    PAYMENTS BY AGENT TO LENDERS..........................................................................0
   12.15    SETTLEMENT............................................................................................0
   12.16    LETTERS OF CREDIT; INTRA-LENDER ISSUES................................................................0
   12.17    CONCERNING THE RELATED LOAN DOCUMENTS.................................................................0
   12.18    FIELD AUDIT AND EXAMINATION REPORTS; DISCLAIMER BY LENDERS............................................0
   12.19    RELATION AMONG LENDERS................................................................................0

ARTICLE 13 MISCELLANEOUS..........................................................................................0

   13.1     NO WAIVERS; CUMULATIVE REMEDIES.......................................................................0
   13.2     SEVERABILITY..........................................................................................0
   13.3     GOVERNING LAW; CHOICE OF FORUM; SERVICE OF PROCESS....................................................0
   13.4     WAIVER OF JURY TRIAL..................................................................................0
   13.5     SURVIVAL OF REPRESENTATIONS AND WARRANTIES............................................................0
   13.6     [INTENTIONALLY OMITTED.]..............................................................................0
   13.7     FEES AND EXPENSES.....................................................................................0
   13.8     NOTICES...............................................................................................0
   13.9     WAIVER OF NOTICES.....................................................................................0
   13.10    BINDING EFFECT........................................................................................0
   13.11    INDEMNITY OF THE AGENT AND THE LENDERS BY THE BORROWERS...............................................0
   13.12    LIMITATION OF LIABILITY...............................................................................0
   13.13    FINAL AGREEMENT.......................................................................................0
   13.14    COUNTERPARTS..........................................................................................0
   13.15    CAPTIONS..............................................................................................0
   13.16    RIGHT OF SETOFF.......................................................................................0
   13.17    CONFIDENTIALITY.......................................................................................0
   13.18    CONFLICTS WITH OTHER LOAN DOCUMENTS...................................................................0
</TABLE>



<PAGE>


                         ANNEXES, EXHIBITS AND SCHEDULES
                         -------------------------------

ANNEX A             -    DEFINED TERMS

EXHIBIT A           -    FORM OF REVOLVING LOAN NOTE

EXHIBIT B           -    FORM OF BORROWING BASE CERTIFICATE

EXHIBIT C           -    FINANCIAL STATEMENTS

EXHIBIT D           -    FORM OF NOTICE OF BORROWING

EXHIBIT E           -    FORM OF NOTICE OF CONTINUATION/CONVERSION

EXHIBIT F           -    FORM OF FINAL ORDER

EXHIBIT G           -    [INTENTIONALLY OMITTED]

EXHIBIT H           -    FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

SCHEDULE 1.1 - LENDERS' COMMITMENTS (ANNEX A - DEFINED TERMS)

SCHEDULE 1.2      PERSONS DESIGNATED TO REQUEST BORROWINGS

SCHEDULE 6.2 - ORGANIZATION AND QUALIFICATIONS OF BORROWERS

SCHEDULE 6.4 - OTHER SUBSIDIARIES AND AFFILIATES

SCHEDULE 6.7 - DEBT; GUARANTIES; LIENS

SCHEDULE 6.12 - LITIGATION; JUDGMENTS

SCHEDULE 6.17 - ERISA COMPLIANCE

SCHEDULE 6.24 - OTHER DOMESTIC SUBSIDIARIES

SCHEDULE 7.14 - TRANSACTIONS WITH AFFILIATES

SCHEDULE A-1  -  EXISTING INVESTMENTS



<PAGE>

                         POST-PETITION CREDIT AGREEMENT

                  This Post-Petition  Credit Agreement,  dated as of December 8,
2000,  among the financial  institutions  from time to time parties hereto (such
financial  institutions,  together with their respective successors and assigns,
are referred to hereinafter each  individually as a "Lender" and collectively as
the  "Lenders"),  Bank of  America,  N.A.  with an office  at 231 South  LaSalle
Street,  Chicago,  Illinois  60697, as agent for the Lenders,  Owens Corning,  a
Delaware corporation (the "Company"),  and the Subsidiaries of the Company which
are parties to this Agreement  (together with the Company and the other Domestic
Subsidiaries,  if any,  which  hereafter are permitted to become parties to this
Agreement  with the  prior  written  consent  of the  Required  Lenders,  each a
"Borrower" and collectively, the "Borrowers").

                              W I T N E S S E T H:
                               - - - - - - - - - -

                  WHEREAS,  the  Borrowers,  each  of  which  is  a  debtor  and
debtor-in-possession  in a case pending under chapter 11 of the Bankruptcy  Code
(the cases of the Borrowers  each, a  "Bankruptcy  Case" and,  collectively  the
"Bankruptcy  Cases"),  have  requested  the  Lenders  to make  available  to the
Borrowers  a  revolving  line of credit  for loans and  letters  of credit in an
amount not to exceed $500,000,000,  and which extensions of credit the Borrowers
will use for the purposes permitted hereunder;

                  WHEREAS,  capitalized  terms  used in this  Agreement  and not
otherwise  defined  herein shall have the meanings  ascribed  thereto in Annex A
which is attached  hereto and  incorporated  herein;  the rules of  construction
contained  therein shall govern the  interpretation  of this Agreement,  and all
Annexes,  Exhibits and  Schedules  attached  hereto are  incorporated  herein by
reference;

                  WHEREAS,  the  Lenders  have agreed to make  available  to the
Borrowers a revolving credit facility upon the terms and conditions set forth in
this Agreement.

                  WHEREAS, on October 5, 2000 (the "Filing Date"), the Borrowers
filed voluntary  petitions with the Bankruptcy  Court  initiating the Bankruptcy
Cases;

                  WHEREAS,  the Borrowers  have continued in possession of their
respective  assets  and in the  management  of their  respective  businesses  as
debtors-in-possession pursuant to sections 1107 and 1108 of the Bankruptcy Code;

                  WHEREAS,  to provide  security for the  repayment of the loans
and letters of credit made  available  pursuant  hereto and payment of the other
obligations of the Borrowers under the Loan Documents, the Borrowers have agreed
to  provide  the  Agent and the  Lenders  (upon and after the entry of the Final
Order) with respect to the obligations of the Borrowers  hereunder and under the
other Loan  Documents,  an allowed  administrative  expense claim in each of the
Bankruptcy  Cases pursuant to section  364(c)(1) of the  Bankruptcy  Code having
priority over all  administrative  expenses of the kind specified in, or arising
or ordered  under,  any  sections  of the  Bankruptcy  Code,  including  without
limitation,  sections 503(b), 105, 326, 328, 330, 331, 506(c),  507(a),  507(b),
546(c), 726 or 1112 of the Bankruptcy Code, subject only to the Carve-Out; and

                  WHEREAS,  all of the claims granted in the Bankruptcy Cases to
the Agent and the Lenders shall be subject to the Carve-Out.

                  NOW, THEREFORE,  in consideration of the mutual conditions and
agreements set forth in this Agreement, and for good and valuable consideration,
the receipt of which is hereby  acknowledged,  the Lenders,  the Agent,  and the
Borrowers hereby agree as follows.

ARTICLE 1
                           LOANS AND LETTERS OF CREDIT
                           ---------------------------

1.1  Total  Facility.  Subject  to all of  the  terms  and  conditions  of  this
Agreement,  the Lenders agree to make available a total credit facility of up to
$500,000,000 (the "Total Facility") to the Borrowers from time to time until the
Termination  Date.  The Total  Facility shall be composed of a revolving line of
credit consisting of Revolving Loans and Letters of Credit.

1.2      Revolving Loans.
         ---------------

(a) (i) Amounts.  Subject to the  satisfaction  of the conditions  precedent set
forth in Article 8, each Lender  severally,  but not jointly,  agrees,  upon the
Borrower  Representative's  request from time to time on any Business Day during
the period from the Closing  Date to the  Termination  Date,  to make  revolving
loans (the  "Revolving  Loans") to the  Borrowers  in amounts not to exceed such
Lender's  Pro Rata Share of  Availability,  except for  Non-Ratable  Loans.  The
Lenders,  however,  in their unanimous  discretion,  may elect to make Revolving
Loans or issue or  arrange  to have  issued  Letters  of Credit in excess of the
Borrowing  Base on one or more  occasions,  but if they do so, neither the Agent
nor the  Lenders  shall be deemed  thereby  to have  changed  the  limits of the
Borrowing  Base or to be obligated to exceed such limits on any other  occasion.
If the Aggregate Revolver  Outstandings  would exceed  Availability after giving
effect  to any  Borrowing,  the  Lenders  may  refuse  to make or may  otherwise
restrict  the making of  Revolving  Loans as the  Lenders  determine  until such
excess has been eliminated. The entire unpaid balance of the Revolving Loans and
all other  non-contingent  Obligations  shall be immediately  due and payable in
full in immediately available funds on the Termination Date.

(ii)     The  Borrowers  shall execute and deliver to each Lender that requests
the same a note to evidence the Revolving Loans of that Lender to the Borrowers.
Each note shall be in the principal amount of the Lender's Pro Rata Share of the
Revolving Loan Commitments,  dated the date hereof and substantially in the form
of Exhibit A (each a "Revolving  Loan Note" and,  collectively,  the  "Revolving
Loan Notes").  Each  Revolving  Loan Note shall  represent the joint and several
obligation  of the Borrowers to pay the amount of Lender's Pro Rata Share of the
Revolving  Loan  Commitments,  or, if less,  such Lender's Pro Rata Share of the
aggregate  unpaid  principal  amount  of all  Revolving  Loans to the  Borrowers
together with interest thereon as prescribed in Section 2.1.

(b)      Procedure for Borrowing.
         -----------------------

(1)      Each  Borrowing  shall  be  made  upon  the  Borrower  Representative's
         irrevocable  written  notice  delivered  to the  Agent in the form of a
         notice of borrowing ("Notice of Borrowing"),  which must be received by
         the Agent  prior to (i)  12:00  noon  (Chicago,  Illinois  time)  three
         Business Days prior to the requested Funding Date, in the case of LIBOR
         Rate  Loans  and  (ii)  11:00  a.m.  (Chicago,  Illinois  time)  on the
         requested Funding Date, in the case of Base Rate Loans, specifying:

(A)     the  amount of the  Borrowing,  which in the case of a LIBOR  Rate Loan
must equal or exceed $5,000,000 (and increments of $1,000,000 in excess of such
amount);

(B)     the requested Funding Date, which must be a Business Day;

(C)     whether the Revolving  Loans  requested  are to be Base Rate  Revolving
Loans or LIBOR  Revolving  Loans  (and if not  specified,  it shall be  deemed a
request for a Base Rate Revolving Loan);

(D)     the duration of the Interest  Period for LIBOR  Revolving Loans (and if
not  specified,  it shall be  deemed a  request  for an  Interest  Period of one
month);

provided,  however, that with respect to any Borrowing to be made on the Closing
Date, such Borrowings will initially consist of Base Rate Revolving Loans only.

(2)      In  lieu  of   delivering   a  Notice  of   Borrowing,   the   Borrower
         Representative  may give the Agent telephonic  notice of such Borrowing
         request for  advances to the  Designated  Account(s).  The Agent at all
         times  shall be entitled  to rely on such  telephonic  notice in making
         such Revolving Loans, regardless of whether any written confirmation is
         received.

(3)      The  Borrower  shall have no right to request a LIBOR Rate Loan while
         an Event of Default has occurred and is continuing.

(c)      Appointment of Borrower Representative; Reliance upon Authority.
         ---------------------------------------------------------------

(1)      Each Borrower hereby designates the Company as its  representative  and
         agent on its behalf (the "Borrower Representative") for the purposes of
         issuing  Notices of Borrowing  and Notices of  Conversion/Continuation,
         giving instructions with respect to the disbursement of the proceeds of
         the Loans,  selecting  interest  rate  options,  requesting  Letters of
         Credit,  giving and receiving all other notices and consents  hereunder
         or under any of the other Loan  Documents  and taking all other actions
         (including  in respect of compliance  with  covenants) on behalf of any
         Borrower  or  Borrowers   under  the  Loan   Documents.   The  Borrower
         Representative  hereby  accepts  such  appointment.  The Agent and each
         Lender may regard any  notice or other  communication  pursuant  to any
         Loan  Document  from  the  Borrower   Representative  as  a  notice  or
         communication   from  all  Borrowers,   and  may  give  any  notice  or
         communication  required  or  permitted  to be given to any  Borrower or
         Borrowers  hereunder to the Borrower  Representative  on behalf of such
         Borrower or Borrowers. Each Borrower agrees that each notice, election,
         representation and warranty,  covenant,  agreement and undertaking made
         on its behalf by the  Borrower  Representative  shall be deemed for all
         purposes to have been made by such  Borrower  and shall be binding upon
         and enforceable against such Borrower to the same extent as if the same
         had been made directly by such Borrower.

(2)      Prior to the Closing Date, the Borrower Representative shall deliver to
         the Agent,  a notice setting forth an account of the Borrowers to which
         the Agent is authorized to transfer the proceeds of the Revolving Loans
         requested   hereunder   (the   "Designated   Account").   The  Borrower
         Representative may designate a replacement account from time to time by
         written notice. Such Designated Account must be reasonably satisfactory
         to the Agent. The Agent is entitled to rely conclusively on any request
         by a person listed on Schedule 1.2 for Revolving Loans on behalf of the
         Borrower  Representative,  so long as the  proceeds  thereof  are to be
         transferred to the Designated Account.  The Agent has no duty to verify
         the  identity of any  individual  representing  himself or herself as a
         person authorized by the Borrower  Representative to make such requests
         on its behalf.

(d) No  Liability.  The Agent shall not incur any liability to any Borrower as a
result of acting upon any notice  referred to in Sections  1.2(b) and (c), which
the Agent  believes  in good  faith to have been  given by an  officer  or other
person duly  authorized  by the  Borrower  Representative  to request  Revolving
Loans. The crediting of Revolving Loans to the Designated  Account  conclusively
establishes  the joint and several  obligation  of the  Borrowers  to repay such
Revolving Loans as provided herein.

(e)      Notice  Irrevocable.  Any Notice of Borrowing  (or  telephonic  notice
         -------------------
in lieu  thereof)  made pursuant to Section 1.2(b) and (c) shall be irrevocable.
                                    -------------      ---
The Borrowers  shall be bound to borrow  the funds  requested  therein  in
accordance therewith.

(f)  Agent's  Election.  Promptly  after  receipt of a Notice of  Borrowing  (or
telephonic  notice in lieu thereof) for a Base Rate  Revolving  Loan,  the Agent
shall elect to have the terms of Section  1.2(g) or the terms of Section  1.2(h)
apply to such  requested  Borrowing.  If the requested  Borrowing  consists of a
LIBOR Revolving Loan or if the Bank otherwise declines in its sole discretion to
make a Non-Ratable Loan pursuant to Section 1.2(h),  the terms of Section 1.2(g)
shall apply to the requested Borrowing.

(g) Making of Revolving  Loans. If the requested  Borrowing  consists of a LIBOR
Revolving  Loan or if the  Agent  otherwise  elects  to have  the  terms of this
Section 1.2(g) apply to a requested Borrowing,  then promptly after receipt of a
Notice of Borrowing or telephonic notice in lieu thereof, the Agent shall notify
the Lenders by telecopy,  telephone or e-mail of the requested  Borrowing.  Each
Lender shall transfer its Pro Rata Share of the requested Borrowing available to
the Agent in  immediately  available  funds,  to the  account  from time to time
designated by Agent,  not later than 12:00 noon (Chicago,  Illinois time) on the
applicable  Funding  Date.  The Agent shall make the proceeds of such  Revolving
Loans (to the extent actually received by the Agent from the Lenders)  available
to the Borrowers on the applicable  Funding Date by transferring  same day funds
to the  Designated  Account;  provided,  however,  that,  subject  to the second
sentence of Section 1.2(a)(i), the amount of Revolving Loans so made on any date
shall not exceed the Availability on such date.

(h)      Making of Non-Ratable Loans.
         ---------------------------

          (A) If the Agent  elects,  with the  consent of the Bank,  to have the
     terms of this Section 1.2(h) apply to a requested Borrowing, the Bank shall
     make a  Revolving  Loan in the amount of that  Borrowing  available  to the
     Borrowers on the applicable  Funding Date by transferring same day funds to
     the  Designated  Account.  Each  Revolving  Loan  made  solely  by the Bank
     pursuant to this Section is herein referred to as a "Non-Ratable Loan", and
     such  Revolving  Loans are  collectively  referred  to as the  "Non-Ratable
     Loans."  Each  Non-Ratable  Loan  shall be  subject  to all the  terms  and
     conditions  applicable  to other  Revolving  Loans except that all payments
     thereon  shall be  payable  to the Bank  solely  for its own  account.  The
     aggregate  amount of  Non-Ratable  Loans  outstanding at any time shall not
     exceed  $30,000,000.  The  Agent  shall  not  request  the Bank to make any
     Non-Ratable  Loan if (1) the Agent has  received  written  notice  from any
     Lender that one or more of the applicable conditions precedent set forth in
     Article  8 will not be  satisfied  on the  requested  Funding  Date for the
     applicable   Borrowing,   or  (2)  the  requested  Borrowing  would  exceed
     Availability  on that  Funding  Date.  The  Agent  shall not  otherwise  be
     required to determine whether the applicable conditions precedent set forth
     in Article 8 have been  satisfied or the requested  Borrowing  would exceed
     the  Availability  on  that  Funding  Date  applicable   thereto  prior  to
     requesting the Bank to make a Non-Ratable Loan.

          (B) The Non-Ratable  Loans shall  constitute Base Rate Revolving Loans
     and Obligations hereunder.

1.3      [Intentionally Omitted]

1.4      Letters of Credit.

(a) Agreement to Issue or Cause To Issue. Subject to the terms and conditions of
this  Agreement,  the Agent  agrees (i) to cause the Letter of Credit  Issuer to
issue for the  account of any  Borrower  one or more  commercial/documentary  or
standby  letters of credit  ("Letter of Credit")  and/or (ii) to provide  credit
support or other  enhancement to a Letter of Credit Issuer  acceptable to Agent,
which issues a Letter of Credit for the account of any Borrower (any such credit
support or enhancement being herein referred to as a "Credit Support") from time
to time during the term of this  Agreement.  Letters of Credit may be  requested
for the benefit of Other  Subsidiaries,  provided  that a Borrower  shall be the
account  party  with  respect  thereto  and the  foregoing  shall not effect the
Borrowers'  joint and several  reimbursement  Obligations  with  respect to such
Letters of Credit and any related Credit Supports,  and, provided further,  that
the sum of the  undrawn  face  amount of all such  Letters  of  Credit  plus all
amounts drawn  thereunder  for which the  Borrowers  have not been repaid by the
Other Subsidiaries shall not exceed $50,000,000 in the aggregate at any time.

(b) Amounts; Outside Expiration Date. The Agent shall not have any obligation to
issue or cause to be issued any Letter of Credit or to  provide  Credit  Support
for any  Letter of Credit at any time if:  (i) the  maximum  face  amount of the
requested  Letter  of  Credit  is  greater  than the  Unused  Letter  of  Credit
Subfacility  at such  time;  (ii)  subject  to the  second  sentence  of Section
1.2(a)(i),  the maximum  face amount of the  requested  Letter of Credit and all
commissions,  fees,  and charges due from the Borrowers in  connection  with the
opening thereof would exceed  Availability at such time; or (iii) such Letter of
Credit  has an  expiration  date less than 5  Business  Days prior to the Stated
Termination  Date or more than 12 months from the date of  issuance  for standby
letters of credit  (although any such Letter of Credit may provide for automatic
extensions of its  expiration  date for one or more  successive 12 month periods
provided that the Letter of Credit Issuer has the right to terminate such Letter
of Credit on each such annual expiration date and no renewal term may extend the
final  expiration  date to a date later than the fifth Business Day prior to the
Stated  Termination Date) and 180 days for documentary  letters of credit.  With
respect to any Letter of Credit  which  contains  any  "evergreen"  or automatic
renewal  provision,  each Lender  shall be deemed to have  consented to any such
extension or renewal  unless any such Lender  shall have  provided to the Agent,
written  notice that it declines to consent to any such  extension or renewal at
least thirty (30) days prior to the date on which the Letter of Credit Issuer is
entitled  to  decline  to extend or renew the  Letter of  Credit.  If all of the
requirements  of this Section 1.4 are met and no Default or Event of Default has
occurred  and is  continuing,  no Lender  shall  decline  to consent to any such
extension or renewal.

(c) Other Conditions.  In addition to conditions  precedent contained in Article
8, the  obligation  of the Agent to issue or to cause to be issued any Letter of
Credit or to provide  Credit  Support for any Letter of Credit is subject to the
following  conditions  precedent  having been  satisfied in a manner  reasonably
satisfactory to the Agent:

(1)      The  Borrower  Representative  shall  have  delivered  to the Letter of
         Credit  Issuer,  at such  times and in such  manner  as such  Letter of
         Credit  Issuer may  prescribe,  an  application  in form and  substance
         satisfactory   to  such   Letter  of  Credit   Issuer  and   reasonably
         satisfactory  to the Agent for the issuance of the Letter of Credit and
         such other documents as may be required  pursuant to the terms thereof,
         and the form,  terms and purpose of the proposed Letter of Credit shall
         be  reasonably  satisfactory  to the  Agent  and the  Letter  of Credit
         Issuer; and

(2)      As of the  date of  issuance,  no  order of any  court,  arbitrator  or
         Governmental Authority shall purport by its terms to enjoin or restrain
         money center banks generally from issuing letters of credit of the type
         and in the amount of the proposed Letter of Credit, and no law, rule or
         regulation applicable to money center banks generally and no request or
         directive   (whether   or  not  having  the  force  of  law)  from  any
         Governmental  Authority  with  jurisdiction  over  money  center  banks
         generally shall prohibit, or request that the proposed Letter of Credit
         Issuer refrain from, the issuance of letters of credit generally or the
         issuance of such Letters of Credit.

(d)      Issuance of Letters of Credit.
         -----------------------------

(1)      Request for Issuance. The Borrower Representative must notify the Agent
         of a requested  Letter of Credit at least three (3) Business Days prior
         to the proposed  issuance date.  Such notice shall be  irrevocable  and
         must specify the Borrower for whose  account such Letter of Credit will
         be issued,  the original face amount of the Letter of Credit requested,
         the  Business  Day of  issuance  of such  requested  Letter of  Credit,
         whether  such  Letter of Credit  may be drawn in a single or in partial
         draws,  the Business Day on which the requested  Letter of Credit is to
         expire,  the  purpose  for which such Letter of Credit is to be issued,
         and the  beneficiary  of the requested  Letter of Credit.  The Borrower
         Representative  shall  attach to such notice the  proposed  form of the
         Letter of Credit.

(2)      Responsibilities  of  the  Agent;  Issuance.  As of  the  Business  Day
         immediately  preceding  the  requested  issuance  date of the Letter of
         Credit,  the Agent shall  determine  the amount of the Unused Letter of
         Credit  Subfacility  and  Availability.  If (i) the face  amount of the
         requested  Letter of Credit  is less than the  Unused  Letter of Credit
         Subfacility and (ii) the amount of such requested  Letter of Credit and
         all commissions, fees, and charges due from the Borrowers in connection
         with the opening thereof would not exceed Availability  (subject to the
         second sentence of Section 1.2(a)(i)), the Agent shall cause the Letter
         of  Credit  Issuer  to issue  the  requested  Letter  of  Credit on the
         requested issuance date so long as the other conditions hereof are met.

(3)      No Extensions  or Amendment.  The Agent shall not be obligated to cause
         the  Letter  of Credit  Issuer to extend or amend any  Letter of Credit
         issued pursuant hereto unless the  requirements of this Section 1.4 are
         met as though a new Letter of Credit were being requested and issued.

(e)      Payments Pursuant to Letters of Credit.
         --------------------------------------

          The Borrowers  jointly and severally  agree to reimburse the Letter of
     Credit Issuer for any draw under any Letter of Credit and the Agent for the
     account of the  Lenders  upon any payment  pursuant  to any Credit  Support
     within  one (1)  Business  Day  following  notification  from the Letter of
     Credit Issuer or the Agent of the amount of such drawing or payment, and to
     pay the Letter of Credit  Issuer the amount of all other  charges  and fees
     payable to the  Letter of Credit  Issuer in  connection  with any Letter of
     Credit within one (1) Business Day following  notification  from the Letter
     of Credit  Issuer or the Agent of the amount of such other charges and fees
     then due, irrespective of (but without waiving) any claim, setoff,  defense
     or other right which any  Borrower  may have at any time against the Letter
     of Credit  Issuer or any other  Person.  The  failure of the  Borrowers  to
     satisfy any such  reimbursement  or other payment  obligation by 12:00 noon
     (Chicago,  Illinois  time) on the date  when due as set forth  above  shall
     constitute  a request by the  Borrowers  to the Agent for a Borrowing  of a
     Base Rate  Revolving  Loan in the unpaid  amount of such  reimbursement  or
     other payment  obligation.  The Funding Date with respect to such Borrowing
     shall be the date such reimbursement or other payment obligation was due.

(f)      Indemnification; Exoneration; Power of Attorney

(1)      Indemnification.  In addition to amounts payable as elsewhere  provided
         in this Section  1.4,  the  Borrowers  jointly and  severally  agree to
         protect,  indemnify,  pay and save the Lenders  and the Agent  harmless
         from and  against any and all claims,  demands,  liabilities,  damages,
         losses,  costs, charges and expenses (including  reasonable  attorneys'
         fees)  which  any  Lender or the Agent  (other  than any  Lender in its
         capacity  as Letter of Credit  Issuer)  may incur or be subject to as a
         consequence,  direct or  indirect,  of the  issuance  of any  Letter of
         Credit  or the  provision  of any  Credit  Support  or  enhancement  in
         connection  therewith,  other than to the extent  solely as a result of
         such Person's gross  negligence or willful  misconduct.  The Borrowers'
         obligations  under  this  Section  shall  survive  payment of all other
         Obligations.

(2)      Assumption  of Risk by the  Borrowers.  As  among  the  Borrowers,  the
         Lenders,  and the Agent, the Borrowers assume all risks of the acts and
         omissions  of, or  misuse  of any of the  Letters  of  Credit  by,  the
         respective  beneficiaries of such Letters of Credit. In furtherance and
         not in limitation of the foregoing, the Lenders and the Agent shall not
         be  responsible  for: (A) the form,  validity,  sufficiency,  accuracy,
         genuineness or legal effect of any document  submitted by any Person in
         connection with the application for and issuance of and presentation of
         drafts with respect to any of the Letters of Credit,  even if it should
         prove to be in any or all respects invalid,  insufficient,  inaccurate,
         fraudulent or forged; (B) the validity or sufficiency of any instrument
         transferring  or  assigning  or  purporting  to  transfer or assign any
         Letter of  Credit or the  rights or  benefits  thereunder  or  proceeds
         thereof,  in  whole or in  part,  which  may  prove  to be  invalid  or
         ineffective  for any reason;  (C) the failure of the beneficiary of any
         Letter of Credit to comply  duly with  conditions  required in order to
         draw upon such Letter of Credit; (D) errors, omissions,  interruptions,
         or delays in transmission or delivery of any messages,  by mail, cable,
         telegraph,  telex or otherwise,  whether or not they be in cipher;  (E)
         errors in  interpretation  of technical terms; (F) any loss or delay in
         the transmission or otherwise of any document required in order to make
         a drawing  under any Letter of Credit or of the proceeds  thereof;  (G)
         the  misapplication  by the  beneficiary of any Letter of Credit of the
         proceeds  of  any  drawing  under  such  Letter  of  Credit;   (H)  any
         consequences  arising from causes  beyond the control of the Lenders or
         the Agent, including any act or omission, whether rightful or wrongful,
         of any present or future de jure or de facto Governmental  Authority or
         (I) subject to Section  1.4(f)(4),  the Letter of Credit Issuer's honor
         of a draw for which the draw or any certificate  fails to comply in any
         respect with the terms of the Letter of Credit.  None of the  foregoing
         shall affect,  impair or prevent the vesting of any rights or powers of
         the Agent or any Lender under this Section 1.4(f).

(3)      Exoneration.  Without  limiting  the  foregoing,  no action or omission
         whatsoever by Agent or any Lender (excluding any Lender in its capacity
         as a Letter of Credit Issuer) under or in connection with any Letter of
         Credit or Credit  Support,  if taken or omitted in the absence of gross
         negligence  or willful  misconduct  on the part of such  Person,  shall
         result in any  liability  of Agent or any  Lender to any  Borrower,  or
         relieve any  Borrower of any of its  obligations  hereunder to any such
         Person.

(4)      Rights  Against  Letter of Credit  Issuer.  Nothing  contained  in this
         Agreement is intended to limit any Borrower's (i) rights,  if any, with
         respect to any Letter of Credit  Issuer  which arise as a result of the
         letter of credit  application  and  related  documents  executed by and
         between such  Borrower and such Letter of Credit  Issuer or (ii) claims
         for direct (as opposed to special, indirect, consequential or punitive)
         damages,  if any, suffered by such Borrower that are caused by (A) such
         Letter of Credit  Issuer's  willful  misconduct or gross  negligence in
         determining  whether  documents  presented  under any  Letter of Credit
         comply with the terms of such  Letter of Credit,  or (B) such Letter of
         Credit Issuer's willful failure to pay under any Letter of Credit after
         the presentation to it of documents  strictly  complying with the terms
         and conditions of such Letter of Credit.

(5)      Indemnification  by  Lenders.  To  the  extent  not  reimbursed  by the
         Borrowers  and  without  limiting  the  obligations  of  the  Borrowers
         hereunder,  the Lenders  agree to indemnify the Letter of Credit Issuer
         ratably in accordance  with their  respective Pro Rata Shares,  for any
         and all liabilities,  obligations, losses, damages, penalties, actions,
         judgments,  suits,  costs,  expenses  (including  attorneys'  fees)  or
         disbursements of any kind and nature whatsoever that may be imposed on,
         incurred by or asserted  against the Letter of Credit Issuer in any way
         relating to or arising out of any Letter of Credit or the  transactions
         contemplated  thereby or any  action  taken or omitted by the Letter of
         Credit  Issuer  under any  Letter of  Credit  or any Loan  Document  in
         connection  therewith;  provided that no Lender shall be liable for any
         of the  foregoing to the extent it arises from the gross  negligence or
         willful misconduct of the Person to be indemnified.  Without limitation
         of the foregoing,  each Lender agrees to reimburse the Letter of Credit
         Issuer  promptly  upon  demand  for its Pro Rata  Share of any costs or
         expenses payable by any Borrower to the Letter of Credit Issuer, to the
         extent that the Letter of Credit Issuer is not promptly  reimbursed for
         such costs and expenses by the  Borrowers.  The agreement  contained in
         this Section shall survive payment in full of all other Obligations.

(6)      Account Party.  Each Borrower hereby  authorizes and directs any Letter
         of Credit Issuer to name such Borrower as the "Account  Party"  therein
         and to  deliver  to the  Agent  all  instruments,  documents  and other
         writings and property  received by the Letter of Credit Issuer pursuant
         to the  Letter  of  Credit,  and to accept  and rely  upon the  Agent's
         instructions  and  agreements  with  respect to all matters  arising in
         connection with the Letter of Credit or the application therefor.

(g)  Supporting  Letter of Credit;  Cash  Collateral.  If,  notwithstanding  the
provisions of Section  1.4(b) and Section  10.1,  any Letter of Credit or Credit
Support is outstanding  upon the termination of this  Agreement,  then upon such
termination the Borrowers shall, with respect to each Letter of Credit or Credit
Support then outstanding,  at the election of the Borrower Representative either
(i)  deposit  with the  Agent,  for the  ratable  benefit  of the  Agent and the
Lenders,  a standby letter of credit (a  "Supporting  Letter of Credit") in form
and  substance  reasonably  satisfactory  to  the  Agent,  issued  by an  issuer
reasonably satisfactory to the Agent or (ii) deposit immediately available funds
into a cash  collateral  account with the Agent and under the sole  dominion and
control of the Agent (the "Cash  Collateral"),  for the  ratable  benefit of the
Agent and the Lenders,  in either case in an amount equal to the greatest amount
for which such  Letter of Credit or such  Credit  Support  may be drawn plus any
fees and expenses  associated with such Letter of Credit or such Credit Support.
The Agent  shall be  entitled  to make  draws  under such  Supporting  Letter of
Credit, or to indefeasibly  apply such Cash Collateral,  in amounts necessary to
reimburse the Agent and the Lenders for payments to be made by the Agent and the
Lenders under such Letter of Credit or Credit  Support and any fees and expenses
associated with such Letter of Credit or Credit Support.  Such Supporting Letter
of Credit or Cash Collateral shall be held by the Agent, for the ratable benefit
of the Agent and the  Lenders,  as security  for, and to provide for the payment
of,  the  aggregate  undrawn  amount of such  Letters  of Credit or such  Credit
Support  remaining  outstanding.  After such  Letters of Credit and such  Credit
Supports  shall have  expired or  otherwise  have been fully  drawn upon and all
reimbursement obligations with respect thereto shall have been paid in full, the
balance,  if any,  of such Cash  Collateral  and/or  all  remaining  outstanding
Supporting  Letters  of  Credit,  if any,  shall  be  returned  to the  Borrower
Representative or as otherwise required by law.

1.5 Bank  Products.  Any  Borrower may request and the Bank may, in its sole and
absolute  discretion,  arrange  for any  Borrower to obtain from the Bank or the
Bank's  Affiliates  Bank Products  although no Borrower is required to do so. If
Bank Products are provided by an Affiliate of the Bank,  the  Borrowers  jointly
and severally agree to indemnify and hold the Bank and the Lenders harmless from
any and all costs and obligations  now or hereafter  incurred by the Bank or any
of the  Lenders  which  arise  from  any  indemnity  given  by the  Bank  to its
Affiliates related to such Bank Products;  provided,  however, nothing contained
herein is intended to limit any Borrower's  rights,  with respect to the Bank or
its Affiliates, if any, which arise as a result of the execution of documents by
and  between  such  Borrower  and the Bank which  relate to Bank  Products.  The
agreement contained in this Section shall survive termination of this Agreement.
The Borrowers acknowledge and agree that the obtaining of Bank Products from the
Bank or the Bank's Affiliates (a) is in the sole and absolute  discretion of the
Bank or the Bank's  Affiliates,  and (b) is subject to all rules and regulations
of the Bank or the Bank's Affiliates.

1.6 Joint and Several  Liability of Borrowers.  Each Borrower  acknowledges  and
agrees  that  all  Obligations  (including  without  limitation  the  Borrowers'
Obligations  in  respect  of the Loans and in respect of any Letter of Credit or
Credit  Support)  shall be the joint and several  obligations  of the Borrowers,
regardless of whether such Borrower  actually receives Loans or other extensions
of credit hereunder or the amounts of such Loans received or the manner in which
the Agent  and/or any Lender  accounts  for such  Loans or other  extensions  of
credit on its books and records.

ARTICLE 2
                                INTEREST AND FEES
2.1      Interest.
         --------

(a) Interest  Rates.  All  outstanding  Loans shall bear  interest on the unpaid
principal amount thereof (including, to the extent permitted by law, on interest
thereon  not paid when due) from the date made  until  paid in full in cash at a
rate  determined  by  reference  to the Base  Rate or the  LIBOR  Rate  plus the
Applicable Margins as set forth below, but not to exceed the Maximum Rate. If at
any time Loans are outstanding with respect to which the Borrower Representative
has not delivered to the Agent a notice specifying the basis for determining the
interest rate applicable thereto in accordance herewith,  those Loans shall bear
interest at a rate  determined by reference to the Base Rate until notice to the
contrary has been given to the Agent in accordance  with this Agreement and such
notice  has  become  effective.   Except  as  otherwise   provided  herein,  the
outstanding Loans shall bear interest as follows:

     (i) For all Base Rate  Loans at a  fluctuating  per annum rate equal to the
Base Rate plus the Applicable Margin; and

     (ii) For all LIBOR  Rate  Loans at a per annum rate equal to the LIBOR Rate
plus the Applicable Margin.

Each change in the Base Rate shall be reflected in the interest rate  applicable
to Base Rate Loans as of the effective date of such change. All interest charges
shall be  computed  on the basis of a year of 360 days and actual  days  elapsed
(which  results in more  interest  being paid than if computed on the basis of a
365-day year).  The Borrowers shall pay to the Agent, for the ratable benefit of
Lenders,  interest accrued on all Base Rate Loans in arrears on the first day of
each month hereafter and on the Termination Date. The Borrowers shall pay to the
Agent,  for the ratable benefit of Lenders,  interest on all LIBOR Rate Loans in
arrears on each LIBOR Interest Payment Date.

(b) Default Rate. If any Event of Default occurs and is continuing and the Agent
or the Required Lenders in their discretion so elect, then, while any such Event
of  Default  is  continuing,  the  outstanding  principal  balance  of all Loans
(including,  to the maximum extent permitted by law, accrued and unpaid interest
thereon) shall bear interest at the Default Rate applicable to such Loans.

2.2      Continuation and Conversion Elections.
         -------------------------------------

(a)      The Borrower Representative may:

(i) elect,  as of any  Business  Day, to convert any Base Rate Loans or any part
thereof  (in an  amount  not less  than  $5,000,000,  or that is in an  integral
multiple of $1,000,000 in excess thereof) into LIBOR Rate Loans; or

(ii) elect, as of the last day of the applicable  Interest  Period,  to continue
any LIBOR Rate Loans having  Interest  Periods  expiring on such day or any part
thereof  (in an  amount  not less  than  $5,000,000,  or that is in an  integral
multiple of $1,000,000 in excess thereof);

provided,  that if at any time the  aggregate  amount  of  LIBOR  Rate  Loans in
respect of any Borrowing is reduced,  by payment,  prepayment,  or conversion of
part  thereof  to  be  less  than  $5,000,000,   such  LIBOR  Rate  Loans  shall
automatically  convert into Base Rate Loans; provided further that if the Notice
of  Continuation/Conversion  shall fail to specify the  duration of the Interest
Period, such Interest Period shall be one month.

(b)   The    Borrower    Representative    shall    deliver    a    notice    of
continuation/conversion  ("Notice of  Continuation/Conversion") to the Agent not
later than 12:00 noon (Chicago,  Illinois time) at least three (3) Business Days
in advance of the Continuation/Conversion Date, if the Loans are to be converted
into or continued as LIBOR Rate Loans and specifying:

(i)      the proposed Continuation/Conversion Date;

(ii)     the aggregate amount of Loans to be converted or continued;

(iii) the type of Loans resulting from the proposed  conversion or continuation;
and

(iv) the duration of the  requested  Interest  Period,  provided,  however,  the
Borrower  Representative  may not select an Interest  Period that ends after the
Stated Termination Date.

(c) If upon the  expiration  of any  Interest  Period  applicable  to LIBOR Rate
Loans,  the Borrower  Representative  has failed to select timely a new Interest
Period to be  applicable  to LIBOR Rate  Loans or if any Event of  Default  then
exists, the Borrower  Representative  shall be deemed to have elected to convert
such LIBOR Rate Loans into Base Rate Loans  effective as of the expiration  date
of such Interest Period.

(d) The Agent will  promptly  notify  each  Lender of its receipt of a Notice of
Continuation/Conversion. All conversions and continuations shall be made ratably
according  to the  respective  outstanding  principal  amounts of the Loans with
respect to which the notice was given held by each Lender.

(e) There may not be more than nine (9) different  Interest Periods with respect
to LIBOR Rate Loans in effect hereunder at any time.

2.3 Maximum  Interest  Rate.  In no event shall any interest  rate  provided for
hereunder  exceed the  maximum  rate  legally  chargeable  by any  Lender  under
applicable  law for such Lender with  respect to loans of the type  provided for
hereunder (the "Maximum Rate"). If, in any month, any interest rate, absent such
limitation,  would have  exceeded the Maximum  Rate,  then the interest rate for
that month shall be the Maximum Rate,  and, if in future  months,  that interest
rate would  otherwise be less than the Maximum  Rate,  then that  interest  rate
shall remain at the Maximum Rate until such time as the amount of interest  paid
hereunder  equals the amount of interest  which would have been paid if the same
had not been  limited by the Maximum  Rate.  In the event that,  upon payment in
full of the Obligations,  the total amount of interest paid or accrued under the
terms of this  Agreement is less than the total amount of interest  which would,
but for this  Section  2.3,  have  been paid or  accrued  if the  interest  rate
otherwise set forth in this Agreement had at all times been in effect,  then the
Borrowers  shall, to the extent  permitted by applicable law, pay the Agent, for
the account of the  Lenders,  an amount equal to the excess of (a) the lesser of
(i) the amount of  interest  which would have been  charged if the Maximum  Rate
had,  at all times,  been in effect or (ii) the amount of  interest  which would
have accrued had the interest rate otherwise set forth in this Agreement, at all
times,  been in effect over (b) the amount of interest  actually paid or accrued
under this Agreement.  If a court of competent jurisdiction  determines that the
Agent and/or any Lender has received  interest  and other  charges  hereunder in
excess of the Maximum Rate,  such excess shall be deemed received on account of,
and shall  automatically  be  applied  to  reduce,  the  Obligations  other than
interest,  in the inverse  order of  maturity,  and if there are no  Obligations
outstanding,  the  Agent  and/or  such  Lender  shall  refund  to  the  Borrower
Representative, on behalf of the Borrowers, such excess.

     2.4 Facility  Fee;  Syndication  Fee;  Administration  Fee.  The  Borrowers
jointly and severally agree to pay the Agent,  for the Agent's sole account,  on
the Closing Date:

(a)      a facility fee (the "Facility Fee") in the amount $2,500,000;

(b)      a syndication fee (the "Syndication Fee") in the amount of $2,500,000;
         and

(c)      an administration fee (the "Administration Fee") in the amount of
         $200,000.

The Agent shall apply the commitment fee in the amount of $1,000,000  previously
paid by the  Borrowers  to the Agent  pursuant to the  commitment  letter  dated
October  4, 2000 among the Agent and the  Borrowers  (the  "Commitment  Letter")
against the Facility Fee referred to above.

2.5 Unused Line Fee. On the first  Business Day of each month (or, if later,  on
the first  Business  Day  following  notification  by the Agent to the  Borrower
Representative  of  the  amount  owing  hereunder  on  such  date)  and  on  the
Termination Date, the Borrowers jointly and severally agree to pay to the Agent,
for the account of the Lenders,  in accordance  with their  respective  Pro Rata
Shares, an unused line fee (the "Unused Line Fee") equal to three-eighths of one
percent (.375%) per annum times the amount by which the Maximum  Revolver Amount
exceeded the sum of the average daily outstanding  principal amount of Revolving
Loans and the average daily undrawn face amount of outstanding Letters of Credit
during the  immediately  preceding  month or shorter period if calculated on the
Termination  Date.  The  Unused  Line Fee  shall be  computed  on the basis of a
360-day  year for the actual  number of days  elapsed.  All  principal  payments
received  by the Agent shall be deemed to be  credited  to the  Borrowers'  Loan
Account immediately upon receipt for purposes of calculating the Unused Line Fee
pursuant to this Section 2.5.

2.6 Letter of Credit Fee.  With  respect to any month  during  which a Letter of
Credit is outstanding,  the Borrowers  jointly and severally agree to pay to the
Agent,  for the account of the Lenders,  in accordance with their respective Pro
Rata Shares,  for Letters of Credit, a fee (the "Letter of Credit Fee") equal to
the  Applicable  L/C Margin per annum from time to time in effect  multiplied by
the average daily  maximum  aggregate  amount from time to time  available to be
drawn under all  outstanding  Letters of Credit  during  such month,  and to the
Letter of Credit Issuer, all out-of-pocket  costs, fees and expenses incurred by
the Letter of Credit Issuer in connection with the application  for,  processing
of,  issuance of, or amendment  to any Letter of Credit,  which costs,  fees and
expenses shall include a "fronting  fee" of  one-quarter of one percent  (0.25%)
per  annum of the  average  daily  maximum  aggregate  amount  from time to time
available to be drawn under all  outstanding  standby  Letters of Credit  during
such  month,  payable to the Letter of Credit  Issuer.  The Letter of Credit Fee
shall be payable  monthly in  arrears  on the first  Business  Day of each month
following any month in which a Letter of Credit is outstanding (or, if later, on
the first  Business  Day  following  notification  by the Agent to the  Borrower
Representative  of  the  amount  owing  hereunder  on  such  date)  and  on  the
Termination  Date.  The Letter of Credit Fee shall be computed on the basis of a
360-day year for the actual number of days elapsed.

ARTICLE 3
                            PAYMENTS AND PREPAYMENTS

3.1 Revolving Loans. The Borrowers shall repay the outstanding principal balance
of the Revolving  Loans,  plus all accrued but unpaid interest  thereon,  on the
Termination  Date. The Borrowers may prepay  Revolving Loans in whole or in part
at any time, and reborrow  subject to the terms of this Agreement.  In addition,
and without limiting the generality of the foregoing,  upon demand the Borrowers
shall  pay to the  Agent,  for  account  of the  Lenders,  the  amount,  without
duplication,  by which the Aggregate Revolver Outstandings exceeds the lesser of
the Borrowing Base or the Maximum Revolver Amount.

3.2  Termination  of Facility;  Reductions in Revolving  Loan  Commitments.  The
Borrower  Representative  may terminate  this  Agreement  upon at least five (5)
Business  Days' notice to the Agent and the Lenders and to the  Committee,  upon
(a) the  payment  in full of all  outstanding  Revolving  Loans,  together  with
accrued and unpaid  interest  thereon,  and the  cancellation  and return of all
outstanding  Letters of Credit (or the delivery of Supporting  Letters of Credit
or Cash Collateral in respect thereof in accordance  with Section  1.4(g)),  (b)
the payment in full in cash of all reimbursable  expenses and other Obligations,
and (c) with  respect to any LIBOR Rate Loans  prepaid in  connection  with such
termination  prior to the  expiration  date of the  Interest  Period  applicable
thereto,  the payment of the amounts described in Section 4.4. The Agent and the
Lenders shall be entitled to assume (without any investigation)  that any notice
required to be delivered  hereunder by the Borrower to the Committee has been so
delivered.

                  In addition,  after the first anniversary of the Closing Date,
the Borrower  Representative may, from time to time, permanently reduce (but not
terminate) the Revolving Loan Commitments  (which will result in a corresponding
reduction in the Maximum  Revolver  Amount) upon at least five (5) Business Days
notice to the Agent and the Lenders and to the Committee;  provided that (a) any
such  reduction  shall  be in a  minimum  amount  of  $50,000,000  and  integral
multiples  of  $50,000,000  in excess of such  amount,  (b) the  Revolving  Loan
Commitments  (and the Maximum Revolver Amount) shall not be reduced to an amount
less than  $300,000,000  and (c) after giving effect to any such  reduction (and
the corresponding reduction in the Maximum Revolver Amount),  Availability shall
be greater  than zero.  The Agent and the  Lenders  shall be  entitled to assume
(without any investigation)  that any notice required to be delivered  hereunder
by the Borrower to the Committee has been so delivered.

3.3      [Intentionally omitted.]
         ----------------------

3.4      [Intentionally omitted.]
         ----------------------

3.5 LIBOR Rate Loan Prepayments. In connection with any prepayment of LIBOR Rate
Loans,  if any LIBOR Rate Loans are prepaid prior to the expiration  date of the
Interest Period applicable  thereto,  the Borrowers shall pay to the Lenders the
amounts described in Section 4.4.

3.6      Payments by the Borrowers.
         -------------------------

(a) All  payments to be made by the  Borrowers  shall be made  without  set-off,
recoupment or counterclaim.  Except as otherwise  expressly provided herein, all
payments  by the  Borrowers  shall be made to the Agent for the  account  of the
Lenders, at the account designated by the Agent and shall be made in Dollars and
in immediately  available  funds,  no later than 12:00 noon  (Chicago,  Illinois
time) on the date specified herein. Any payment received by the Agent after such
time shall be deemed (for purposes of  calculating  interest  only) to have been
received on the following Business Day and any applicable  interest or fee shall
continue to accrue.

(b) Subject to the provisions set forth in the definition of "Interest  Period",
whenever  any payment is due on a day other than a Business  Day,  such  payment
shall be due on the following  Business Day, and such extension of time shall in
such case be included in the  computation  of interest or fees,  as the case may
be.

3.7 Payments as Revolving  Loans. At the election of the Agent,  all payments of
principal,  interest,  reimbursement  obligations in connection  with Letters of
Credit and Credit Support for Letters of Credit,  fees,  premiums,  reimbursable
expenses and other sums payable  hereunder which are not made on or before 12:00
noon (Chicago, Illinois time) on the due date specified herein, may be paid from
the proceeds of Revolving Loans made hereunder. The Borrowers hereby irrevocably
authorize  the Agent to charge the Loan  Account  for the  purpose of paying all
amounts  from time to time due  hereunder  which are not paid on or before 12:00
noon (Chicago  time) on the due date  specified  herein and agrees that all such
amounts charged shall constitute Revolving Loans (including Non-Ratable Loans).

3.8 Apportionment,  Application and Reversal of Payments. Principal and interest
payments shall be apportioned ratably among the Lenders (according to the unpaid
principal  balance  of the  Loans to which  such  payments  relate  held by each
Lender) and payments of the fees shall,  as applicable,  be apportioned  ratably
among the  Lenders,  except for fees  payable  solely to Agent and the Letter of
Credit Issuer and except as provided in Section  11.1(b).  All payments shall be
remitted  to the  Agent and all such  payments  not  relating  to  principal  or
interest of specific Loans, or not constituting  payment of specific fees, shall
be applied, ratably, subject to the provisions of this Agreement,  first, to pay
any fees,  indemnities  or expense  reimbursements  including  any such  amounts
relating to Bank Products then due to the Agent from the Borrowers;  second,  to
pay any  fees  or  expense  reimbursements  then  due to the  Lenders  from  the
Borrowers;  third,  to pay  interest  due in  respect  of all  Revolving  Loans,
including  Non-Ratable  Loans;  fourth,  to  pay  or  prepay  principal  of  the
Non-Ratable  Loans;  fifth,  to pay or prepay  principal of the Revolving  Loans
(other than Non-Ratable Loans) and unpaid  reimbursement  obligations in respect
of  Letters of  Credit;  sixth,  to cash  collateralize  outstanding  Letters of
Credit;  and  seventh,  to the  payment of any other  Obligation  including  any
amounts  relating to Bank  Products due to the Bank or any Affiliate of the Bank
by any  Borrower.  Notwithstanding  anything to the  contrary  contained in this
Agreement, unless so directed by the Borrower Representative, or unless an Event
of Default  has  occurred  and is  continuing,  neither the Agent nor any Lender
shall apply any payments which it receives to any LIBOR Rate Loan, except (a) on
the  expiration  date of the Interest  Period  applicable to any such LIBOR Rate
Loan, or (b) in the event, and only to the extent, that there are no outstanding
Base Rate Loans and, in any event, the Borrowers shall pay LIBOR breakage losses
in accordance with Section 4.4.

3.9  Indemnity for Returned  Payments.  If after receipt of any payment which is
applied to the payment of all or any part of the  Obligations,  the Agent or any
Lender is for any reason  compelled to surrender such payment or proceeds to any
Person because such payment or application of proceeds is invalidated,  declared
fraudulent,  set  aside,  determined  to be void or  voidable  as a  preference,
impermissible  setoff,  or a diversion of trust funds,  or for any other reason,
then the  Obligations or part thereof  intended to be satisfied shall be revived
and continued and this Agreement shall continue in full force as if such payment
or proceeds had not been  received by the Agent or such Lender and the Borrowers
shall be liable to pay to the Agent and the Lenders, and hereby do indemnify the
Agent and the Lenders and hold the Agent and the Lenders harmless for the amount
of such  payment or proceeds  surrendered.  The  provisions  of this Section 3.9
shall be and remain effective notwithstanding any contrary action which may have
been  taken by the  Agent  or any  Lender  in  reliance  upon  such  payment  or
application of proceeds,  and any such contrary action so taken shall be without
prejudice to the Agent's and the Lenders'  rights under this Agreement and shall
be deemed to have been  conditioned upon such payment or application of proceeds
having become final and  irrevocable.  The  provisions of this Section 3.9 shall
survive the termination of this Agreement.

3.10 Agent's and Lenders' Books and Records; Monthly Statements. The Agent shall
record the principal amount of the Loans owing to each Lender,  the undrawn face
amount of all outstanding  Letters of Credit and the aggregate  amount of unpaid
reimbursement obligations outstanding with respect to the Letters of Credit from
time to time on its books. In addition, each Lender may note the date and amount
of each payment or prepayment  of principal of such Lender's  Loans in its books
and  records.  Failure  by Agent or any Lender to make such  notation  shall not
affect the obligations of the Borrowers with respect to the Loans or the Letters
of Credit.  The  Borrowers  agree that the Agent's and each  Lender's  books and
records showing the Obligations and the transactions  pursuant to this Agreement
and the other Loan  Documents  shall be  admissible  in any action or proceeding
arising therefrom,  and shall constitute  rebuttably  presumptive proof thereof,
irrespective of whether any Obligation is also evidenced by a promissory note or
other  instrument.  The Agent will  provide  to the  Borrower  Representative  a
monthly statement of Loans,  payments,  and other transactions  pursuant to this
Agreement. Such statement shall be deemed correct,  accurate, and binding on the
Borrowers and an account stated (except for corrections of errors  discovered by
the Agent), unless the Borrower  Representative notifies the Agent in writing to
the contrary  within thirty (30) days after such  statement is rendered.  In the
event  a  timely   written  notice  of  objections  is  given  by  the  Borrower
Representative,  only the items to which  exception  is  expressly  made will be
considered to be disputed by the Borrower Representative.

ARTICLE 4
                     TAXES, YIELD PROTECTION AND ILLEGALITY
4.1      Taxes.
         -----

(a) Any and all payments by each Borrower to each Lender or the Agent under this
Agreement  and any other  Loan  Document  shall be made  free and clear of,  and
without deduction or withholding for any Taxes. In addition, the Borrowers shall
pay all Other Taxes.

(b) The  Borrowers  jointly and  severally  agree to indemnify and hold harmless
each Lender and the Agent for the full amount of Taxes or Other Taxes (including
any Taxes or Other Taxes imposed by any  jurisdiction  on amounts  payable under
this  Section)  paid by any Lender or the Agent in  respect  to any sum  payable
hereunder and any liability (including penalties, interest, additions to tax and
expenses) arising  therefrom or with respect thereto,  whether or not such Taxes
or  Other  Taxes  were  correctly  or  legally  asserted.   Payment  under  this
indemnification  shall be made  within 30 days after the date such Lender or the
Agent makes written demand therefor to the Borrower Representative.

(c) If any Borrower  shall be required by law to deduct or withhold any Taxes or
Other Taxes from or in respect of any sum payable hereunder to any Lender or the
Agent,  then (provided the Borrowers  shall not be required to pay such Taxes if
such  obligation  to  withhold  or pay  Taxes  results  from,  or would not have
occurred  but for the failure of such Lender to deliver the forms  described  in
Section  12.10 in the manner and at the times  specified in such Section  unless
Lender is legally not able to deliver such forms) then:

(i) the sum payable  shall be  increased  as  necessary so that after making all
required  deductions and  withholdings  of such Taxes or Other Taxes  (including
deductions  and  withholdings  applicable to additional  sums payable under this
Section) such Lender or the Agent,  as the case may be, receives an amount equal
to the sum it would have received had no such  deductions or  withholdings  been
made;

(ii)     such Borrower shall make such deductions and withholdings;

(iii) such  Borrower  shall pay the full  amount  deducted  or  withheld  to the
relevant taxing  authority or other authority in accordance with applicable law;
and

(iv) such Borrower shall also pay to each Lender or the Agent for the account of
such Lender,  at the time  interest is paid,  all  additional  amounts which the
respective  Lender  specifies as reasonably  necessary to preserve the after-tax
yield such Lender would have  received if such Taxes or Other Taxes had not been
imposed.

(d) At the Agent's request,  within 30 days after the date of any payment by any
Borrower of Taxes or Other Taxes, the Borrower  Representative shall furnish the
Agent the original or a certified copy of a receipt  evidencing payment thereof,
or other evidence of payment reasonably satisfactory to the Agent.

(e) If any Borrower is required to pay  additional  amounts to any Lender or the
Agent  pursuant  to this  Section  4.1,  then such Lender  shall use  reasonable
efforts  (consistent  with  legal and  regulatory  restrictions)  to change  the
jurisdiction  of its  lending  office  so as to  eliminate  any such  additional
payment by such  Borrower  which may  thereafter  accrue,  if such change in the
judgment of such Lender is not otherwise disadvantageous to such Lender.

(f) If a Lender shall become aware (without any duty to investigate) that it may
be entitled to claim a refund in respect of any Taxes or Other Taxes as to which
it has been fully  indemnified by any of the Borrowers  pursuant to this Section
4.1, such Lender (i) shall promptly  notify the Borrower  Representative  of the
possibility  of claiming such refund and (ii) shall,  after receipt of a request
by the Borrower  Representative,  apply for such refund. If a Lender is required
to  apply  for a  refund  of Taxes or  Other  Taxes  pursuant  to the  preceding
sentence,  the Borrowers shall reimburse the Lender for its expenses incurred in
respect of such claim for refund.  If any Lender receives a refund in respect of
any Taxes or Other Taxes as to which it has been fully indemnified by any of the
Borrowers  pursuant to this Section 4.1, it shall  promptly  notify the Borrower
Representative of such refund and pay such refund to the Borrower Representative
(to the  extent of amounts  that have been  fully  paid by any of the  Borrowers
under this Section 4.1 with respect to such refund and had not  previously  been
reimbursed),  net of all  out-of-pocket  expenses  of such  Lender  and  without
interest  (other than the interest,  if any,  included in such refund net of any
Taxes payable with respect to receipt of such refund).  This Section shall apply
only (i) if the  Lender  determines  that it can apply and pay over such  refund
without  prejudice  to the  retention  of the  refund  and (ii) such  Lender has
determined  that such  refund  will leave such  Lender  after such  payment in a
position no worse then it would have been if the Borrower had not been  required
to make such  deduction  or  withholding.  The Lender  shall not be obligated to
disclose  to  the  Borrower  any  information   regarding  its  tax  affairs  or
computations,  and nothing in this Section 4.1(f) shall interfere with the right
of the Lender to arrange  its tax affairs as it deems  appropriate  or impose an
obligation on such Lender to obtain any refund if, in its sole opinion, to do so
would (x) impose undue hardships,  burdens or expenditures on it or (y) increase
its exposure to taxation by the jurisdiction in question.

(g)  Limitations.  Notwithstanding  anything to the contrary  contained  herein,
unless  an  assignment  to a new  Lender  had been  made at the  request  of the
Borrowers  or such an  assignment  to a new  Lender  occurred  while an Event of
Default  was  continuing;  no Borrower  shall be required to pay any  additional
amount in respect of the  withholding  of United  States  Federal  income  taxes
pursuant to this Section 4.1 to any Lender except to the extent such withholding
is a result of a change of law  enacted  after the date such  Person  becomes or
became a Lender.

4.2      Illegality.
         ----------

(a) If any Lender determines that the introduction of any Requirement of Law, or
any change in any Requirement of Law, or in the interpretation or administration
of any  Requirement  of Law, has made it  unlawful,  or that any central bank or
other Governmental Authority has asserted that it is unlawful, for any Lender or
its applicable  lending office to make LIBOR Rate Loans, then, on notice thereof
by that Lender to the Borrower  Representative through the Agent, any obligation
of that  Lender to make LIBOR Rate Loans  shall be  suspended  until that Lender
notifies the Agent and the Borrower Representative that the circumstances giving
rise to such determination no longer exist.

(b) If a Lender  determines that it is unlawful to maintain any LIBOR Rate Loan,
the Borrowers  shall,  upon the Borrower  Representative's  receipt of notice of
such fact and demand from such Lender  (with a copy to the Agent),  be deemed to
have  automatically  converted  such  LIBOR  Rate  Loans  to  such  Lender  then
outstanding into Base Rate Loans,  either on the last day of the Interest Period
thereof,  if that Lender may lawfully continue to maintain such LIBOR Rate Loans
to such day,  or  immediately,  if that  Lender  may not  lawfully  continue  to
maintain such LIBOR Rate Loans.

4.3      Increased Costs and Reduction of Return.
         ---------------------------------------

(a) If any Lender  determines that due to either (i) the  introduction of or any
change in the  interpretation  of any law or  regulation  adopted after the date
hereof or (ii) the  compliance by that Lender with any guideline or request from
any  central  bank or other  Governmental  Authority  (whether or not having the
force of law) adopted after the date hereof,  there shall be any increase in the
cost to such Lender of agreeing to make or making,  funding or  maintaining  any
LIBOR Rate Loans, then the Borrowers shall be liable for, and shall from time to
time,  within fifteen (15) days following written demand therefor by such Lender
to the  Borrower  Representative  (with a copy of such  demand to be sent to the
Agent),  pay to the Agent for the account of such Lender,  additional amounts as
are sufficient to compensate such Lender for such increased costs.

(b) If any Lender shall have determined that (i) the introduction of any Capital
Adequacy  Regulation  after the date  hereof,  (ii) any  change  in any  Capital
Adequacy   Regulation   after  the  date   hereof,   (iii)  any  change  in  the
interpretation  or  administration  of any Capital  Adequacy  Regulation  by any
central bank or other Governmental  Authority charged with the interpretation or
administration  thereof after the date hereof, or (iv) compliance by such Lender
or any  corporation  or other  entity  controlling  such Lender with any Capital
Adequacy  Regulation adopted after the date hereof,  affects or would affect the
amount of capital  required or expected to be  maintained  by such Lender or any
corporation or other entity  controlling such Lender (excluding any reserve that
is reflected in the LIBOR Rate) and (taking into  consideration such Lender's or
such  corporation's or other entity's policies with respect to capital adequacy)
determines  that the amount of such capital is increased as a consequence of its
Commitments,  loans,  credits or obligations under this Agreement,  then, within
fifteen  (15) days  following  written  demand  therefor  by such  Lender to the
Borrower  Representative  through  the Agent,  the  Borrowers  shall pay to such
Lender,  from  time to time as  specified  by such  Lender,  additional  amounts
sufficient to compensate such Lender for such increase.

4.4      Funding  Losses.  The Borrowers  shall  reimburse each Lender and hold
each Lender  harmless from any loss or expense which such Lender may sustain or
incur as a consequence of:

(a)      the failure of the Borrowers to make on a timely basis any payment of
principal of any LIBOR Rate Loan;

(b) the failure of the  Borrowers to borrow a LIBOR Rate Loan,  continue a LIBOR
Rate  Loan  or  convert  a Loan  into a  LIBOR  Rate  Loan  after  the  Borrower
Representative has given (or is deemed to have given) a Notice of Borrowing or a
Notice of Continuation/Conversion; or

(c)      the prepayment or other payment  (including after  acceleration
thereof) of any LIBOR Rate Loans on a day that is not the last day of the
relevant Interest Period;

including without limitation any loss or expense arising from the liquidation or
reemployment  of funds  obtained by it to maintain  its LIBOR Rate Loans or from
fees payable to terminate the deposits from which such funds were  obtained.  At
the  election  of  any  Lender,  and  without  limiting  the  generality  of the
foregoing,  but without duplication,  such compensation on account of losses may
include an amount equal to the excess of (i) the  interest  that would have been
received from the Borrowers under this Agreement on any amounts to be reemployed
during  an  Interest  Period or its  remaining  portion  over (ii) the  interest
component of the return that such Lender  determines  it could have obtained had
it placed  such  amount on deposit  in the  interbank  market  for the  relevant
currency  selected by it for a period equal to such Interest Period, or term, or
any remaining portion thereof.

4.5  Inability  to Determine  Rates.  If, prior to the first day of any Interest
Period,  the Agent  determines that for any reason adequate and reasonable means
do not exist for  determining  the LIBOR Rate for any requested  Interest Period
with  respect  to a proposed  LIBOR  Rate  Loan,  or that the LIBOR Rate for any
requested  Interest  Period with respect to a proposed  LIBOR Rate Loan does not
adequately  and fairly reflect the cost to the Lenders of funding such Loan, the
Agent will  promptly  so notify the  Borrower  Representative  and each  Lender.
Thereafter,  the  obligation of the Lenders to make or maintain LIBOR Rate Loans
hereunder  shall be  suspended  until the Agent  revokes such notice in writing.
Upon receipt of such notice,  the Borrower  Representative may revoke any Notice
of Borrowing or Notice of  Continuation/Conversion  then submitted by it. If the
Borrower  Representative  does not revoke such Notice,  the Lenders  shall make,
convert or continue the Loans,  as proposed by the Borrower  Representative,  in
the  amount  specified  in the  applicable  notice  submitted  by  the  Borrower
Representative,  but such Loans shall be made,  converted  or  continued as Base
Rate Loans instead of LIBOR Rate Loans.

4.6  Certificates of Agent. If any Lender claims  reimbursement  or compensation
under this  Article 4,  Agent  shall  determine  the  amount  thereof  and shall
promptly  deliver to the  Borrower  Representative  (with a copy to the affected
Lender) a certificate  setting forth in reasonable detail the computation of any
amount payable to the affected Lender,  and such certificate shall be conclusive
and binding on the Borrowers in the absence of manifest error.

4.7 Survival.  The agreements and obligations of the Borrowers in this Article 4
shall  be  joint  and  several  and  shall  survive  the  payment  of all  other
Obligations.  4.8 Affected Lenders. Within 15 days after receipt by the Borrower
Representative  of  written  notice and  demand  from any  Lender (an  "Affected
Lender")  demanding payment of additional amounts or increased costs as provided
in Sections 4.1 or 4.3, or exercising its rights under Section 4.2, the Borrower
Representative may, at its option,  notify the Agent and such Affected Lender of
its intention to replace the Affected Lender. So long as no Event of Default has
occurred and is  continuing,  the Borrower,  with the consent of the Agent,  may
obtain, at the Borrowers' expense, a replacement Lender  ("Replacement  Lender")
for  the  Affected  Lender,   which  Replacement   Lender  shall  be  reasonably
satisfactory to the Agent. If the Borrower  obtains a Replacement  Lender within
90 days  following  notice of its intention to do so, the Affected  Lender shall
sell and  assign its Loans and  Commitments  to such  Replacement  Lender for an
amount equal to the principal  balance of all Loans held by the Affected  Lender
and all accrued  interest and fees with respect thereto through the date of such
sale;  provided,  that the Borrowers  shall have reimbursed such Affected Lender
for the  additional  amounts or  increased  costs that it is entitled to receive
under  this   Agreement   through   the  date  of  such  sale  and   assignment.
Notwithstanding the foregoing,  the Borrower  Representative  shall not have the
right to obtain a Replacement  Lender if the Affected Lender rescinds its demand
for increased costs or additional  amounts,  or the exercise of its rights under
Section   4.2,   within  15  days   following   its  receipt  of  the   Borrower
Representative's   notice  of  intention  to  replace  such   Affected   Lender.
Furthermore,  if the  Borrower  Representative  gives a notice of  intention  to
replace and does not so replace such Affected Lender within 90 days  thereafter,
the Borrower  Representative's rights under this Section 4.8 shall terminate and
the  Borrowers  shall  promptly pay all increased  costs or  additional  amounts
demanded by such Affected Lender pursuant to Sections 4.1 and 4.3.

ARTICLE 5
                BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES

5.1 Books and Records.  The Borrowers  shall,  and shall cause their  respective
Subsidiaries  to,  maintain,  at all times, a system of accounting and keep such
correct and complete books, records and accounts as may be required or necessary
to permit the preparation of Financial Statements in accordance with GAAP.

5.2 Financial Information.  The Borrowers shall promptly furnish to each Lender,
all such financial  information as the Agent shall reasonably  request.  Without
limiting the foregoing,  the Borrowers will furnish to the Agent,  in sufficient
copies for distribution by the Agent to each Lender, the following:

(a) As soon as available, but in any event not later than one hundred (100) days
after the close of each Fiscal Year,  consolidated  audited balance sheets,  and
income statements,  cash flow statements and changes in stockholders' equity for
the Company and its  consolidated  Subsidiaries  for such Fiscal  Year,  and the
accompanying  notes  thereto,  setting  forth in each case in  comparative  form
figures  for  the  previous  Fiscal  Year,  all  in  reasonable  detail,  fairly
presenting in all material  respects the  financial  position and the results of
operations  of the  Company  and its  consolidated  Subsidiaries  as at the date
thereof and for the Fiscal  Year then ended,  and  prepared in  accordance  with
GAAP.  Such statements  shall be examined in accordance with generally  accepted
auditing standards by Arthur Andersen LLP or other independent  certified public
accountants  selected by the Company and reasonably  satisfactory  to the Agent,
and accompanied by a report of such accountants on such statements, which report
shall be  unqualified  as to scope of audit.  The Company,  simultaneously  with
retaining  such  independent  public  accountants  to conduct such annual audit,
shall  send a  letter  to such  accountants,  with a copy to the  Agent  and the
Lenders,  notifying  such  accountants  that  one of the  primary  purposes  for
retaining such  accountants'  services and having audited  financial  statements
prepared by them is for use by the Agent and the Lenders.

(b) As soon as available, but in any event not later than thirty (30) days after
the end of each month, the monthly financial information required to be provided
by the Borrowers to the Bankruptcy Court. The Borrower Representative, on behalf
of the Borrowers, shall certify by a certificate signed by a Responsible Officer
that all such statements are fairly stated in all material respects,  subject to
normal year-end adjustments.

(c) As soon as available,  but in any event not later than  fifty-five (55) days
after the end of each of the first three  fiscal  quarters of each Fiscal  Year,
consolidated  unaudited  balance  sheets  of the  Company  and its  consolidated
Subsidiaries as at the end of such fiscal quarter,  and  consolidated  unaudited
income  statements and cash flow statements for the Company and its consolidated
Subsidiaries  for such fiscal  quarter and for the period from the  beginning of
the Fiscal Year to the end of such fiscal  quarter,  all in  reasonable  detail,
fairly presenting in all material respects the financial position and results of
operations  of the  Company  and its  consolidated  Subsidiaries  as at the date
thereof and for such periods, and, in each case, in comparable form, figures for
the  corresponding  period in the prior Fiscal Year,  and prepared in accordance
with GAAP  (except for the absence of footnotes  and subject to normal  year-end
adjustments) applied consistently with the audited Financial Statements required
to be delivered  pursuant to Section  5.2(a).  The Borrower  Representative,  on
behalf of the  Borrowers,  shall  certify by a  certificate  signed by its chief
financial officer that all such statements have been prepared in accordance with
GAAP  (except  for the  absence of  footnotes  and  subject  to normal  year-end
adjustments) and present fairly in all material respects the financial  position
of the Company and its consolidated Subsidiaries as at the dates thereof and the
results of operations of the Company and its  consolidated  Subsidiaries for the
periods then ended, subject to normal year-end adjustments.

(d) With each of the audited annual Financial  Statements  delivered pursuant to
Section 5.2(a), a certificate of the independent  certified  public  accountants
that  examined  such  statement  to the effect that they have  reviewed  and are
familiar with this Agreement and that, in examining  such Financial  Statements,
they did not become  aware of any fact or  condition  which then  constituted  a
Default or Event of Default with respect to the financial  covenant set forth in
Section 7.21,  except for those, if any,  described in reasonable detail in such
certificate.

(e) With each of the annual audited Financial  Statements  delivered pursuant to
Section 5.2(a), and with each of the quarterly  unaudited  Financial  Statements
delivered pursuant to Section 5.2(c), (1) a certificate of a Responsible Officer
setting forth in reasonable  detail the calculations  required to establish that
the  Borrowers  were in  compliance  with the covenant set forth in Section 7.21
during the period covered in such Financial Statements and as at the end thereof
and  (2) a copy of  management's  discussion  and  analysis  of  such  Financial
Statements  contained  in the  Company's  Form 10-K  Annual  Report or Form 10-Q
Quarterly Report filed with the Securities and Exchange  Commission with respect
to such Fiscal Year or fiscal quarter,  as applicable.  With each of the monthly
Financial  Statements delivered pursuant to Section 5.2(b), and with each of the
quarterly unaudited Financial Statements delivered pursuant to Section 5.2(c), a
certificate  of a  Responsible  Officer  stating  that,  except as  explained in
reasonable  detail in such  certificate,  no Default  or Event of  Default  then
exists or existed during the period covered by the Financial Statements for such
month or fiscal quarter,  as applicable.  If such  certificate  discloses that a
Default or Event of Default existed or exists,  such certificate shall set forth
what action the Borrowers have taken or propose to take with respect thereto.

(f) Not less than thirty (30) days after the  beginning of each Fiscal Year,  an
annual  projected  budget (to include  projected  consolidated  balance  sheets,
income statements and cash flow statements) for the Company and its consolidated
Subsidiaries as at the end of and for each month of such Fiscal Year.

(g)  Promptly  after  filing  with the PBGC and the IRS,  a copy of each  annual
report or other filing filed with respect to each Pension Plan of any Borrower.

(h) Promptly upon the filing  thereof,  copies of all reports,  if any, filed by
the Company or any of its  consolidated  Subsidiaries  with the  Securities  and
Exchange  Commission  under the  Exchange  Act,  and all  reports,  notices,  or
statements  sent by the Company or any of its  consolidated  Subsidiaries to the
holders of any equity interests of the Company.

(i) Promptly  after any  Borrower's  receipt  thereof,  a copy of all management
letters   prepared  for  any  Borrower  by  any  independent   certified  public
accountants of any Borrower.

(j) Promptly after transmittal thereof,  copies of any and all proxy statements,
financial  statements,  and reports  which the Company  makes  available  to its
shareholders.

(k) (i) On the date hereof,  a Borrowing  Base  Certificate  as of September 30,
2000 (but giving  effect to the  repayment  in full of the  accounts  receivable
securitization  facility of certain of the Borrowers with Alpine  Securitization
Corp.,  which has been repaid in full and terminated  prior to the Closing Date)
and (ii)  thereafter,  within  fifteen (15)  Business Days after the end of each
month, a Borrowing Base Certificate as of the last day of such month.

(l) The  following  information  at the  following  times  (in  form  reasonably
satisfactory  to the Agent):  (i) together with each Borrowing Base  Certificate
delivered  after the date  hereof  pursuant  to Section  5.2(k),  (1) a schedule
summarizing the Borrowers'  Accounts created,  credits given, cash collected and
other  adjustments to Accounts since the last such schedule,  (2) summary agings
of the Borrowers' Accounts,  together with a reconciliation to the corresponding
Borrowing  Base  and  to  the  Borrowers'  general  ledgers,  (3)  a  report  of
contra-accounts  (or,  if  requested  by  the  Agent,  a  summary  aging  of the
Borrowers' accounts payable), (4) Consolidation Ledgers of Inventory by category
and location, together with a reconciliation to the corresponding Borrowing Base
and to the  Borrowers'  general  ledgers;  (ii) upon  request  by the  Agent,  a
statement of the balance of each of the intercompany Accounts;  (iii) such other
reports as to the  Accounts and  Inventory  of the  Borrowers as the Agent shall
reasonably  request from time to time; and (iv) with the delivery of each of the
foregoing,  a  certificate  of  the  Borrower   Representative   executed  by  a
Responsible  Officer  certifying  as to the  accuracy  and  completeness  of the
foregoing.

(m) Such additional  information as the Agent and/or any Lender may from time to
time  reasonably  request  regarding the  financial and business  affairs of the
Company or any Subsidiary.

5.3 Notices to the Lenders.  Promptly upon a Responsible  Officer becoming aware
thereof,  the Borrowers shall notify the Agent and the Lenders in writing of the
following matters:

(a)      any Default or Event of Default;

(b) the  commencement by the holder of any capital stock of any Other Subsidiary
or the holder of any Debt of any Other  Subsidiary in a face amount in excess of
$50,000,000  of  any  enforcement  action  because  of an  asserted  default  or
non-compliance;

(c) any pending or threatened action, suit, or proceeding, by any Person, or any
pending or threatened  investigation  by a Governmental  Authority,  which would
reasonably be expected to have a Material  Adverse  Effect;  or the rendering of
any  judgment  against  one or  more of the  Borrowers  in any  action,  suit or
proceeding awarding damages in excess of $2,000,000;

(d) any pending  strike,  work stoppage,  unfair labor practice  claim, or other
labor dispute  affecting any Borrower or any Other  Subsidiary in a manner which
would reasonably be expected to have a Material Adverse Effect;

(e) receipt of any notice of any violation of any law, statute,  regulation,  or
ordinance  of a  Governmental  Authority  affecting  any  Borrower  or any Other
Subsidiary which would reasonably be expected to have a Material Adverse Effect;

(f) any notice of any  violation by any Borrower or any Other  Subsidiary of any
Environmental  Law which would reasonably be expected to have a Material Adverse
Effect or that any  Governmental  Authority  has  asserted  in writing  that any
Borrower or any Other Subsidiary is not in compliance with any Environmental Law
or is  investigating  any  Borrower's  or  such  Other  Subsidiary's  compliance
therewith which  noncompliance  would  reasonably be expected to have a Material
Adverse Effect;

(g) any written  notice that any Borrower or any Other  Subsidiary  is or may be
liable to any  Person as a result of the  Release or  threatened  Release of any
Contaminant  or  that  any  Borrower  or any  Other  Subsidiary  is  subject  to
investigation  by any  Governmental  Authority  evaluating  whether any remedial
action is  needed  to  respond  to the  Release  or  threatened  Release  of any
Contaminant  which,  in either  case,  is  reasonably  likely to have a Material
Adverse Effect;

(h)      any written  notice of the imposition of any  Environmental  Lien
against any property of any Borrower or, if reasonably likely to have a Material
Adverse Effect, any Other Subsidiary;

(i) an ERISA Event or a  prohibited  transaction  (as defined in Sections 406 of
ERISA and 4975 of the Code) has occurred  with respect to a Pension  Plan,  and,
when known,  any action taken or threatened by the IRS, the DOL or the PBGC with
respect  thereto,  which would reasonably be expected to have a Material Adverse
Affect;

(j) in the event that such filing reflects a significant  change with respect to
the matters  covered  thereby,  within three (3) Business  Days after the filing
thereof  with  the  PBGC,  the DOL or the  IRS,  as  applicable,  copies  of the
following:  (i) each annual  report  (form 5500  series),  including  Schedule B
thereto,  filed with the PBGC,  the DOL or the IRS with  respect to each Pension
Plan, (ii) a copy of each funding waiver request filed with the PBGC, the DOL or
the IRS with respect to any Pension Plan and all communications  received by any
Borrower or any ERISA  Affiliate  from the PBGC, the DOL or the IRS with respect
to such request,  and (iii) a copy of each other filing or notice filed with the
PBGC,  the DOL or the IRS,  with respect to each Pension Plan by any Borrower or
any ERISA Affiliate;

(k)  copies  of the  following:  (i) any  notices  of the  PBGC's  intention  to
terminate a Plan or to have a trustee  appointed to administer  such Plan;  (ii)
any  determination  letter from the IRS  regarding the  qualification  of a Plan
under Section 401(a) of the Code; or (iii) any notice from a Multi-employer Plan
regarding the imposition of withdrawal liability;

(l) (i) any changes in the  benefits of any  existing  Plan which  increase  any
Borrower's  annual  normal or prior  service  costs with  respect  thereto by an
amount in excess of $5,000,000,  or the establishment of any new Pension Plan or
the  commencement of  contributions to any Pension Plan to which any Borrower or
any ERISA Affiliate was not previously contributing;  or (ii) any failure by any
Borrower  or any ERISA  Affiliate  to make a required  installment  or any other
required  payment  under  Section  412 of the Code on or before the due date for
such installment or payment; or

(m)  (i) a  Multi-employer  Plan  has  been  or will  be  terminated;  (ii)  the
administrator  or plan sponsor of a  Multi-employer  Plan intends to terminate a
Multi-employer  Plan;  or  (iii)  the  PBGC  has  instituted  or will  institute
proceedings under Section 4042 of ERISA to terminate a Multi-employer Plan.

                  Each  notice  given  under this  Section  shall  describe  the
subject matter thereof in reasonable detail, and shall set forth the action that
any Borrower, any Other Subsidiary,  or any ERISA Affiliate, as applicable,  has
taken or proposes to take with respect thereto.

ARTICLE 6
                     GENERAL WARRANTIES AND REPRESENTATIONS

                  Each Borrower jointly and severally warrants and represents to
the Agent and the Lenders that except as hereafter  disclosed to and accepted by
the Agent and the Required Lenders in writing: 6.1 Authorization,  Validity, and
Enforceability of this Agreement and the Loan Documents. Subject to the entry by
the  Bankruptcy  Court of the Final Order,  (a) each  Borrower has the power and
authority  to execute,  deliver and perform  this  Agreement  and the other Loan
Documents to which it is a party and to incur the Obligations, (b) each Borrower
has taken all  necessary  action  to  authorize  its  execution,  delivery,  and
performance  of this  Agreement  and the other Loan  Documents  to which it is a
party;  (c) this  Agreement and the other Loan  Documents to which it is a party
have been duly  executed and  delivered by each  Borrower,  and  constitute  the
legal, valid and binding obligations of such Borrower, enforceable against it in
accordance with their respective terms and the terms of the Final Order, and (d)
each Borrower's execution,  delivery,  and performance of this Agreement and the
other  Loan  Documents  to which it is a party do not and will not (i) result in
the imposition of any Lien upon the property of such Borrower,  by reason of the
terms of (1) any contract, mortgage, lease, agreement,  indenture, or instrument
to which such Borrower is a party or which is binding upon it (including  any of
the foregoing  entered into after the Filing Date),  (2) any  Requirement of Law
applicable to such Borrower, or (3) the certificate or articles of incorporation
or by-laws or the limited liability company or limited partnership  agreement of
such  Borrower or (ii)  conflict  with,  or  constitute  a violation  of (1) any
contract,  mortgage,  lease,  agreement,  indenture, or instrument to which such
Borrower is a party or which is binding  upon it and that was entered into after
the Filing  Date,  except  where such  conflict,  violation  or breach would not
reasonably be expected to have a Material Adverse Effect, (2) any Requirement of
Law applicable to such Borrower, except where such conflict, violation or breach
would not  reasonably be expected to have a Material  Adverse  Effect or (3) the
certificate  or articles of  incorporation  or by-laws or the limited  liability
company or limited partnership agreement of such Borrower.

6.2 Borrowers' Organization and Qualification of Borrowers. Each Borrower (a) is
duly organized or incorporated  and validly  existing in good standing under the
laws of the state of its organization or  incorporation,  (b) is qualified to do
business and is in good standing in the  jurisdictions set forth on Schedule 6.2
applicable  to such  Borrower  which  are the only  jurisdictions  in which  the
failure to so qualify or be in good  standing  would  reasonably  be expected to
have a Material  Adverse Effect and (c) has all requisite power and authority to
conduct its business and to own its  property,  except where the failure to have
such power and  authority  would not  reasonably  be expected to have a Material
Adverse  Effect.  Schedule  6.4 is a correct and  complete  list of the name and
relationship to the Company of each of the Borrowers which is a Subsidiary.

6.3      [Intentionally Omitted.]
         ----------------------

6.4 Other Subsidiaries and Affiliates. As of the Closing Date, Schedule 6.4 is a
correct and complete list of the name and relationship to the Company of each of
the Other  Subsidiaries and other Affiliates.  Each Other Subsidiary is (a) duly
incorporated  or organized and validly  existing in good standing under the laws
of its state of  incorporation or organization set forth on Schedule 6.4, except
where the failure to be validly  existing  would not  reasonably  be expected to
have a Material  Adverse  Effect and (b)  qualified  to do business  and in good
standing in each  jurisdiction  in which the failure to so qualify or be in good
standing would  reasonably be expected to have a Material Adverse Effect and (c)
has all  requisite  power and  authority  to conduct  its  business  and own its
property,  except where the failure to have such power and  authority  would not
reasonably be expected to have a Material Adverse Effect.

6.5      Financial Statements and Projections.
         ------------------------------------

(a) The Borrower  Representative  has delivered to the Agent and the Lenders the
audited balance sheet and related statements of income,  retained earnings, cash
flows,  and changes in stockholders  equity for the Company and its consolidated
Subsidiaries  as of  December  31,  1999 and for the  Fiscal  Year  then  ended,
accompanied by the report thereon of the Company's  independent certified public
accountants, Arthur Andersen LLP. The Borrower Representative has also delivered
to the Agent and the Lenders the unaudited balance sheet and related  statements
of income and cash flows for the Company and its consolidated Subsidiaries as of
September 30, 2000. Such financial  statements are attached hereto as Exhibit C.
All such financial statements have been prepared in accordance with GAAP (except
for the absence of footnotes in the case of the  foregoing  unaudited  financial
statements)  and present  accurately  and fairly in all  material  respects  the
consolidated financial position of the Company and its consolidated Subsidiaries
as at the dates  thereof  and the  consolidated  results  of  operations  of the
Company and its consolidated Subsidiaries for the periods then ended, subject to
normal year-end adjustments.

(b) The Latest  Projections  when  submitted  to the Lenders as required  herein
represent the Borrowers' good faith estimate of the future financial performance
of the  Company  and its  consolidated  Subsidiaries  for the  periods set forth
therein.  The  Latest  Projections  have  been  prepared  on  the  basis  of the
assumptions set forth therein,  which Borrowers  believe are fair and reasonable
in light of current and reasonably  foreseeable  business conditions at the time
submitted to the Lenders,  it being  understood  that nothing  contained in this
Section  6.5(b)  shall  constitute  a  representation  or warranty of the future
financial  performance  or results of  operations  of the  Company or any of its
Subsidiaries.

6.6      [Intentionally omitted.]
          ---------------------

6.7      Debt.  As of the  Closing  Date,  no  Borrower  has any  Debt  except
(a) the  Obligations,  and (b) Debt described on Schedule 6.7.


6.8      [Intentionally omitted.]
          ---------------------

6.9 Title to Property;  Liens. Each Borrower has good title in fee simple to all
material Real Estate owned by such Borrower,  and valid  leasehold  interests in
all material  Real Estate  leased by such  Borrower,  and each Borrower has good
title to all of its other material  property  (including the assets reflected on
the latest Financial Statements  delivered to the Agent and the Lenders,  except
as disposed of in the ordinary  course of business  since the date thereof or as
otherwise  permitted  under  this  Agreement),  free of all Liens  except  Liens
permitted under Section 7.17.

6.10 Proprietary Rights. To the best of each Borrower's  knowledge,  none of the
Proprietary  Rights of any  Borrower  or any Other  Subsidiary  infringes  on or
conflicts  with any other  Person's  property,  and no other  Person's  property
infringes on or  conflicts  with the  Proprietary  Rights of any Borrower or any
Other  Subsidiary,  in any  case  where  such  infringement  or  conflict  would
reasonably be expected to have a Material Adverse Effect.

6.11     [Intentionally Omitted.]
          ---------------------

6.12 Litigation. There is no pending, or to the best of any Borrower's knowledge
threatened, action, suit, proceeding, or counterclaim against the Company or any
of its consolidated Subsidiaries before any Governmental Authority or arbitrator
or panels of arbitrators (collectively, "Litigation"), which would reasonably be
expected to have a Material Adverse Effect.  Schedule 6.12 sets forth, as of the
date hereof, (a) a summary of all material pending,  and to the knowledge of the
Borrowers,  threatened,  Litigation  against  any  Borrower  that  involves  any
material risk of a Material Adverse Effect and (b) a schedule of all outstanding
and unpaid judgments against the Borrowers.

6.13     [Intentionally omitted.]
          ---------------------

6.14 Environmental Laws. Without limiting the generality of Section 6.15, in the
ordinary  course of its business the Company  conducts an ongoing  review of the
effect of Environmental  Laws on the business,  operations and properties of the
Company and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including,  without limitation, any capital or
operating  expenditures  required  for  clean-up,   remediation  or  closure  of
properties presently or previously owned, any capital or operating  expenditures
required  to  achieve  or  maintain  compliance  with  environmental  protection
standards  imposed by law or as a condition of any license,  permit or contract,
any related  constraints  on  operating  activities,  including  any periodic or
permanent shutdown of any facility or reduction in the level of or change in the
nature of operations conducted thereat, and any actual or potential  liabilities
to third parties,  including employees,  and any related costs and expenses). On
the  basis  of  this  review,   the  Company  has   reasonably   concluded  that
Environmental  Laws would not reasonably be expected to have a Material  Adverse
Effect.

6.15 No Violation of Law. No Borrower nor any Other  Subsidiary  is in violation
of  any  law,  statute,  regulation,   ordinance,  judgment,  order,  or  decree
applicable to it which violation would reasonably be expected to have a Material
Adverse Effect.

6.16 No Default. No Borrower nor any Other Subsidiary is in default with respect
to any  note,  indenture,  loan  agreement,  mortgage,  lease,  deed,  or  other
agreement to which such Borrower or such Other Subsidiary is a party or by which
it is bound,  which  default  would  reasonably  be  expected to have a Material
Adverse Effect.

6.17 ERISA  Compliance.  Except as  specifically  disclosed in Schedule 6.17 and
except to the extent that any of the following  would not reasonably be expected
to have a Material Adverse Effect:

(a) Each Plan is in  compliance  in all material  respects  with the  applicable
provisions of ERISA, the Code and other federal or state law. Each Plan which is
intended to qualify  under  Section  401(a) of the Code has received a favorable
determination  letter from the IRS and to the best of any Borrower's  knowledge,
nothing has  occurred  which would  cause the loss of such  qualification.  Each
Borrower and each ERISA  Affiliate  has made all required  contributions  to any
Plan subject to Section 412 of the Code, and no application for a funding waiver
or an extension of any  amortization  period pursuant to Section 412 of the Code
has been made with respect to any Plan.

(b) There are no pending or, to the best of the Borrowers' knowledge, threatened
claims,  actions or  lawsuits,  or action by any  Governmental  Authority,  with
respect to any Plan which has resulted or would reasonably be expected to result
in a Material  Adverse  Effect.  There has been no  prohibited  transaction  (as
defined  in  Section  406 of ERISA  and 4975 of the  Code) or  violation  of the
fiduciary  responsibility  rules under ERISA with  respect to any Plan which has
resulted or would reasonably be expected to result in a Material Adverse Effect.

(c) (i) No ERISA Event has occurred or is reasonably  expected to occur; (ii) no
Pension Plan has any Unfunded Pension Liability; (iii) no Borrower nor any ERISA
Affiliate has  incurred,  or reasonably  expects to incur,  any liability  under
Title IV of ERISA with respect to any Pension Plan (other than  premiums due and
not  delinquent  under  Section  4007 of ERISA);  (iv) no Borrower nor any ERISA
Affiliate has incurred,  or reasonably  expects to incur,  any liability (and no
event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Section 4201 or 4243 of ERISA with respect
to a  Multi-employer  Plan;  and (v) no  Borrower  nor any ERISA  Affiliate  has
engaged in a  transaction  that  would be subject to Section  4069 or 4212(c) of
ERISA.

6.18 Taxes.  Each Borrower and each Other  Subsidiary have filed all federal and
other tax returns and  reports  required to be filed,  and have paid all federal
and other taxes,  assessments,  fees and other  governmental  charges  levied or
imposed  upon  them or their  properties,  income or  assets  otherwise  due and
payable other than (a) in the case of the  Borrowers,  such taxes,  assessments,
fees and other governmental  charges (i) the payment of which has been stayed as
a result of the  Borrowers'  status as  debtors-in-possession  in the Bankruptcy
Cases or by an order of the Bankruptcy  Court,  (ii) that are not yet delinquent
or (iii) that are being contested in good faith and for which adequate  reserves
have been  established  by the Borrowers in accordance  with GAAP and (b) in the
case of the Other Subsidiaries,  such taxes,  assessments fees and other charges
the  nonpayment  of which  would not  reasonably  be expected to have a Material
Adverse Effect.

6.19 Regulated Entities.  No Borrower and no Person controlling any Borrower, is
an  "Investment  Company"  within the meaning of the  Investment  Company Act of
1940.  No Borrower is subject to  regulation  under the Public  Utility  Holding
Company Act of 1935,  the Federal  Power Act, the  Interstate  Commerce Act, any
state public  utilities  code or law, or any other  federal or state  statute or
regulation limiting its ability to incur indebtedness.

6.20 Use of Proceeds;  Margin  Regulations.  The proceeds of the Loans are to be
used  solely for  working  capital  and other  general  corporate  purposes.  No
Borrower nor any Other  Subsidiary  is engaged in the business of  purchasing or
selling  Margin  Stock or  extending  credit for the  purpose of  purchasing  or
carrying  Margin Stock. No part of the proceeds of any Borrowing will be used in
violation  of  Regulation  U of the Board of  Governors  of the Federal  Reserve
System  as in  effect  from  time to time and in no  event  shall  Margin  Stock
constitute  25% or more  of the  assets  of the  Company  and  its  consolidated
Subsidiaries.

6.21 Copyrights,  Patents,  Trademarks and Licenses, etc. Each Borrower and each
Other  Subsidiary  owns or is licensed or otherwise  has the right to use all of
the patents,  trademarks,  service marks, trade names,  copyrights,  contractual
franchises,  licenses,  rights of way,  authorizations and other rights that are
reasonably necessary for the operation of its businesses,  without conflict with
the  rights of any other  Person,  except  where the  failure to do so would not
reasonably  be expected to have a Material  Adverse  Effect.  To the best of the
Borrowers' knowledge, no slogan or other advertising device,  product,  process,
method,  substance,  part or other material now employed, by any Borrower or any
Other Subsidiary infringes upon any rights held by any other Person,  except for
such claims and  infringements  that would not  reasonably be expected to have a
Material Adverse Effect.  No claim or litigation  regarding any of the foregoing
is pending or, to the knowledge of the Borrowers,  threatened,  which, in either
case, would reasonably be expected to have a Material Adverse Effect.

6.22 Full Disclosure. All data, certificates, reports, statements, documents and
other written  information  (excluding any projections or other  forward-looking
information)  furnished to the Agent or any Lender  pursuant to any provision of
this  Agreement or any other Loan Document or in connection  with or pursuant to
any amendment or modification  of, or waiver under,  this Agreement or any other
Loan Document,  shall, at the time the same are so furnished, but in the case of
information  dated as of a prior date,  as of such date,  (x) in the case of any
such prepared in the ordinary course of business, be complete and correct in the
light of the purpose prepared,  and (y) in the case of any such requested by the
Agent or any Lender,  be complete  and correct in all  material  respects to the
extent necessary to give the Agent or such Lender true and accurate knowledge of
the subject matter  thereof,  and the furnishing of the same to the Agent or any
Lender shall constitute a representation and warranty by the applicable Borrower
made on the date  the same are  furnished  to the  Agent or such  Lender  to the
effect specified in clause (x) or (y), as applicable. The foregoing shall not be
in limitation of any other representation or warranty of the Borrowers contained
herein or in any other Loan Document.

6.23 Governmental Authorization. No approval, consent, exemption, authorization,
or other action by, or notice to, or filing with, any Governmental  Authority or
other Person is necessary or required in connection with the execution, delivery
or performance by, or enforcement against, any Borrower of this Agreement or any
other  Loan  Document,  except the  Bankruptcy  Court and  notices to  creditors
required by the Bankruptcy Code.

6.24 Subsidiary  Borrowers.  As of the Closing Date, the  Subsidiaries  that are
Borrowers  constitute all of the  Subsidiaries  of the Company  incorporated  or
organized under the laws of any state in the United States of America ("Domestic
Subsidiaries"),  other than those Domestic  Subsidiaries listed on Schedule 6.24
hereto.

ARTICLE 7
                       AFFIRMATIVE AND NEGATIVE COVENANTS

                  Each Borrower jointly and severally covenants to the Agent and
each Lender that so long as any of the  Obligations  remain  outstanding or this
Agreement is in effect:

7.1 Taxes and Other  Obligations.  Subject to the Bankruptcy Code, each Borrower
shall,  and the  Company  shall  cause  Other  Subsidiary  to, (a) file when due
(subject to any  applicable  grace  periods)  all tax returns and other  reports
which it is required to file;  (b) pay,  or provide  for the  payment,  when due
(subject to any applicable grace periods),  of all taxes, fees,  assessments and
other  governmental  charges  against it or upon its property  arising after the
Petition Date,  and make all required  withholding  and other tax deposits,  and
establish  adequate reserves for the payment of all such items; and (c) pay when
due all Debt owed by it (in the case of any Borrower, arising after the Petition
Date)  and  all  claims  of  materialmen,   mechanics,  carriers,  warehousemen,
landlords,  processors  and other  like  Persons  (in the case of any  Borrower,
arising after the Petition Date), and all other  indebtedness owed by it (in the
case of any Borrower, arising after the Petition Date) and perform and discharge
in a timely  manner all other  obligations  undertaken by it (in the case of any
Borrower, arising after the Petition Date); provided,  however, no Borrower need
pay any of the  foregoing  (i) it is  contesting  in good  faith by  appropriate
proceedings  diligently  pursued,  (ii) as to which such  Borrower or such Other
Subsidiary,  as the case may be, has  established  proper  reserves  as required
under GAAP,  and (iii) the nonpayment of which does not result in the imposition
of a Lien  (other  than a  Permitted  Lien);  provided,  further,  that no Other
Subsidiary  need pay any of the foregoing  where failure to pay such  obligation
would not reasonably be expected to have a Material Adverse Effect.

7.2 Legal  Existence and Good Standing.  Except as permitted  under Section 7.8,
each  Borrower  shall,  and the Company  shall cause each Other  Subsidiary  to,
maintain its legal  existence  and its  qualification  and good  standing in all
jurisdictions in which the failure to maintain such existence and  qualification
or good standing would reasonably be expected to have a Material Adverse Effect.

7.3 Compliance with Law and Agreements;  Maintenance of Licenses.  Each Borrower
shall comply,  and the Company shall cause each Other  Subsidiary to comply,  in
all material respects with all Requirements of Law of any Governmental Authority
having  jurisdiction  over it or its business  (including the Federal Fair Labor
Standards  Act and all  Environmental  Laws),  except where the failure to do so
would not  reasonably  be  expected  to have a  Material  Adverse  Effect.  Each
Borrower shall, and the Company shall cause each Other Subsidiary to, obtain and
maintain all licenses,  permits,  franchises,  and  governmental  authorizations
necessary  to own its  property  and to conduct its business as conducted on the
Closing Date, except where the failure to do so would not reasonably be expected
to have a Material Adverse Effect. No Borrower shall modify,  amend or alter its
certificate  or articles of  incorporation,  or its  limited  liability  company
operating agreement or limited partnership agreement, as applicable,  other than
in a manner  which does not  adversely  affect the rights of the  Lenders or the
Agent in any material respect.

7.4      Maintenance of Property; Inspection of Property.
         -----------------------------------------------

(a) Each Borrower shall,  and the Company shall cause each Other  Subsidiary to,
maintain  all of its  property  necessary  and  useful  in  the  conduct  of its
business,  in good  operating  condition  and  repair,  ordinary  wear  and tear
excepted,  except where the failure to do so would not reasonably be expected to
have a Material Adverse Effect.

(b) Each Borrower,  shall, permit representatives and independent contractors of
the Agent (at the expense of the Borrowers not to exceed four (4) times per year
unless an Event of Default has occurred and is  continuing) to visit and inspect
any of its  properties,  to  examine  its  corporate,  financial  and  operating
records,  and make  abstracts  therefrom  or copies  (to the  extent  reasonably
required by the Agent) and to discuss its affairs,  finances  and accounts  with
its officers and independent public accountants, at such reasonable times during
normal business hours and as soon as may be reasonably desired,  upon reasonable
advance notice to the Borrower  Representative.  The Borrower Representative may
elect to have officers or other management employees accompany the Agent on such
inspections and/or be present for such discussions.

7.5 Insurance.  Each Borrower shall  maintain,  and the Company shall cause each
Other  Subsidiary to maintain,  with  financially  sound and reputable  insurers
having a rating of at least A+ or better by Best Rating Guide, insurance against
such risks and in such amounts as are customary for Persons  engaged in the same
or similar  business or as may be required by applicable  law or, in the case of
the Borrowers, as may reasonably requested by the Required Lenders.

7.6  Environmental  Laws. Each Borrower shall,  and the Company shall cause each
Other Subsidiary to, conduct its business in compliance in all material respects
with all  Environmental  Laws applicable to it,  including those relating to the
generation,  handling,  use,  storage,  and disposal of any Contaminant,  except
where the failure to do so would not  reasonably  be expected to have a Material
Adverse  Effect.  Each  Borrower  shall,  and the Company shall cause each Other
Subsidiary   to,  take  prompt  and   appropriate   action  to  respond  to  any
non-compliance  with Environmental Laws, except where the failure to do so would
not reasonably be expected to have a Material Adverse Effect.

7.7 Compliance  with ERISA.  Except as required under the Bankruptcy  Code or an
order of the  Bankruptcy  Court,  or except where the failure to do so would not
reasonably be expected to have a Material  Adverse Effect,  each Borrower shall,
and the Company shall cause each of its ERISA  Affiliates  to: (a) maintain each
Plan in compliance in all material  respects with the  applicable  provisions of
ERISA,  the Code and other  federal or state  law;  (b) cause each Plan which is
qualified under Section 401(a) of the Code to maintain such  qualification;  (c)
make all required  contributions to any Plan subject to Section 412 of the Code;
(d) not engage in a prohibited  transaction (as defined in Sections 406 of ERISA
and 4975 of the Code) or violation of the  fiduciary  responsibility  rules with
respect to any Plan;  and (e) not engage in a transaction  that would be subject
to Section 4069 or 4212(c) of ERISA.

7.8 Mergers,  Consolidations  or Sales. No Borrower shall, nor shall the Company
cause or permit any Other  Subsidiary to, enter into any  transaction of merger,
reorganization, or consolidation, or transfer, sell, assign, lease, or otherwise
dispose of all or any part of its property,  or wind up,  liquidate or dissolve,
or agree to do any of the foregoing  (or, in the case of any Borrower,  apply to
the  Bankruptcy  Court for  authority to do so without the Agent's prior written
consent,  provided  that any  application  consented  to by the  Agent  shall be
abandoned  and  withdrawn  at the  request of the Agent or if the consent of the
Lenders  required  hereunder  to the  taking  of the  action(s)  to  which  such
application  relates is not obtained),  except (i) for sales of Inventory in the
ordinary  course  of its  business,  (ii) for  sales or  other  dispositions  of
property in the ordinary course of business that are surplus, worn out, obsolete
or no longer useable by any Borrower or Other  Subsidiary,  (iii) for any merger
or  consolidation  of any  Borrower  with any  other  Borrower  or of any  Other
Subsidiary with any Other  Subsidiary or other Person (so long as such merger or
consolidation  of  any  Other  Subsidiary  with  such  other  Person  would  not
constitute a Restricted  Investment),  (iv) for any transfer,  sale, assignment,
lease or other  disposition  of all or any part of its  assets  (upon  voluntary
liquidation  or otherwise) by any Borrower to any other Borrower or by any Other
Subsidiary  to any  Other  Subsidiary;  (v) the sale or  compromise  of past due
accounts  receivable in connection  with the collection  thereof in the ordinary
course of  business;  (vi)  leases or  subleases  (or  assignments  of leases or
subleases)  of fixed  assets or  licenses  or  sublicenses  (or  assignments  of
licenses or sublicenses)  of intangibles,  in either case in the ordinary course
of business;  (vii)  dispositions of Cash  Equivalents  (and, in the case of the
Fibreboard  Settlement  Trust,  dispositions  of  Investments  by the Fibreboard
Settlement Trust) in the ordinary course of business at fair market value and on
commercially  reasonable  terms;  (viii) the making of Investments which are not
Restricted  Investments,  if making such Investments would otherwise be deemed a
sale or other  disposition  subject  to this  Section  7.8,  and  (ix)  sales of
Accounts (or of undivided  interests therein) by Other Subsidiaries  pursuant to
factoring  arrangements  entered into by such Other Subsidiaries,  provided that
the aggregate  outstanding  Accounts (or undivided interests therein) subject to
such arrangements  shall not exceed  $35,000,000 at any time; (x) sales or other
dispositions of any asset not otherwise  permitted under this Section 7.8 having
a book value at the time of  disposition  that  represents a  percentage  of the
consolidated  assets of the Company and its  consolidated  Subsidiaries  at such
time  that,  when  added  together  with  all of  the  like  percentages  at the
respective  times of  disposition  represented  by the book  values of all other
assets  disposed of by the Company and its  Subsidiaries  since the Closing Date
does not exceed  10%,  except  that any asset  leased by the Company or any such
Subsidiary shall cease to be deemed to have been disposed of for the purposes of
this  Section at such time,  if any,  as such asset shall cease to be subject to
such lease and shall again be owned by the Company or any such  Subsidiary  free
of any leasehold  interest or other Lien,  except a Lien permitted under Section
7.17;  provided that any sale or other  disposition  permitted under this clause
(x) shall not include any Accounts or  Inventory  of any Borrower  unless (1) no
Default or Event of Default  has  occurred  and is  continuing  or would  result
therefrom,  (2) such sale or other  disposition  is of a  business  unit of such
Borrower, (3) prior to such sale or other disposition, an updated Borrowing Base
Certificate  is  delivered by the  Borrower  Representative  to the Agent giving
effect to such sale or other  disposition and (4) either (A) after giving effect
to such sale or disposition,  either  Availability  is at least  $150,000,000 or
Borrowing Base  Availability is at least  $250,000,000 or (B) in the case of any
sale or disposition  which does not satisfy the  requirements of Clause (A), the
aggregate book value of all Accounts and Inventory  included in any such sale or
disposition,  or  series of  related  sales and  dispositions,  does not  exceed
$10,000,000,  provided,  that  the  aggregate  book  value of all  Accounts  and
Inventory  included in sales and other  dispositions  following the Closing Date
and permitted under this clause (B) shall not exceed $50,000,000.

7.9 Distributions; Capital Change; Restricted Investments. No Borrower shall (i)
directly or  indirectly  declare or make,  or incur any  liability to make,  any
Distribution,  except  (A)  Distributions  to any  other  Borrower  and  (B) the
acquisitions  of shares of the Company's  stock pursuant to any  compensation or
benefit  plan  approved  by the  Bankruptcy  Court,  (ii) make any change in its
capital  structure which would have a Material  Adverse Effect or (iii) make any
Restricted Investment.

7.10     [Intentionally Omitted].
          ---------------------

7.11  Guaranties.  No Borrower shall,  nor shall the Company cause or permit any
Other  Subsidiary to, make,  issue,  or become liable on (or, in the case of any
Borrower,  apply to the Bankruptcy  Court for authority to make, issue or become
liable  on  without  the  Agent's  prior  written  consent,  provided  that  any
application  consented to by the Agent shall be abandoned  and  withdrawn at the
request of the Agent or if the consent of the Lenders required  hereunder to the
taking of the action(s) to which such  application  relates is not obtained) any
Guaranty,  except (a) Guaranties of the  Obligations in favor of the Agent;  (b)
Guaranties  outstanding  on the date  hereof  and  listed  on  Schedule  6.7 and
including,  in the case of the  Other  Subsidiaries,  renewals.  extensions  and
refinancings  of such  Guaranties to the extent of the amount of such Guaranties
as of the date hereof;  (c)  Guaranties by any Other  Subsidiary  arising in the
ordinary course of business; (d) unsecured Guaranties by any Borrower of Debt or
other  obligations  of any  Borrower  other  than  Guaranties  of Debt or  other
obligations  of any other  Borrower  existing on the Filing Date;  (e) unsecured
Guaranties by any Borrower of Debt or other  obligations of any Other Subsidiary
incurred in the ordinary course of business of such Other Subsidiary;  provided,
that the  aggregate  amount of Debt or other  obligations  guarantied  shall not
exceed at any time  outstanding  $50,000,000;  (f)  unsecured  Guaranties by any
Borrower of (1)  obligations of Affiliated  Entities to manufacture  and deliver
goods in the  ordinary  course of business  and (2)  obligations  of  Affiliated
Entities that are product  warranties  given in the ordinary  course of business
with  respect to such  goods,  or are in the nature  of,  and not  exceeding  in
general scope,  product warranties that would otherwise be given in the ordinary
course of business  with  respect to such goods;  provided,  that the  aggregate
amount of  obligations  guarantied  pursuant to this clause (f) shall not exceed
$25,000,000; (g) Guaranties by any Other Subsidiary of Debt or other obligations
of any Affiliated Entity;  and (h) additional  Guaranties (which, in the case of
any Borrower  shall be unsecured and shall  exclude  guaranties of Debt or other
obligations  of the Borrowers  existing on the Filing Date) not exceeding (1) in
the case of the Borrowers,  together with, without duplication,  the Debt of the
Borrowers  permitted  under  Section   7.12(i)(1),   $150,000,000  in  aggregate
principal  amount  at any  time  outstanding  and (2) in the  case of the  Other
Subsidiaries,  together  with,  without  duplication,  the  Debt  of  the  Other
Subsidiaries  permitted under Section  7.12(i)(2),  $75,000,000 in the aggregate
principal amount at any time outstanding.

7.12 Debt.  No Borrower  shall,  nor shall the Company cause or permit any Other
Subsidiary  to,  incur or maintain  any Debt (or,  in the case of any  Borrower,
apply to the  Bankruptcy  Court for authority to do so without the Agent's prior
written consent;  provided that any application  consented to by the Agent shall
be abandoned  and withdrawn at the request of the Agent or if the consent of the
Lenders  required  hereunder  to the  taking  of the  action(s)  to  which  such
application relates is not obtained), other than: (a) the Obligations;  (b) Debt
existing on the Closing Date and described on Schedule 6.7 and including, in the
case of Debt of the Other  Subsidiaries,  renewals,  extensions and refinancings
thereof  to the  extent  of the  principal  amount  of such  Debt as of the date
hereof; (c) Capital Leases of Equipment and purchase money secured Debt incurred
following the Closing Date to purchase  Equipment  provided that (i) in the case
of the Borrowers,  Liens securing the same attach only to the Equipment acquired
by the  incurrence  of such  Debt,  and (ii) the  aggregate  amount of such Debt
(including  Capital Leases)  outstanding does not exceed $25,000,000 at any time
in the case of the  Borrowers,  and  $10,000,000  at any time in the case of the
Other  Subsidiaries;  (d) Permitted  Intercompany  Debt; (e) Debt  consisting of
Guaranties  which are  permitted by Section 7.11;  (f) Debt arising  pursuant to
Hedging Agreements entered into in the ordinary course of business;  (g) Debt of
any entity  existing  at the time such  entity is  acquired by a Borrower or any
Other  Subsidiary  provided  that such Debt  shall  not have  been  incurred  in
contemplation  of such  acquisition  and no Borrower shall guaranty or otherwise
assume such Debt; (h) Debt of Owens Corning (India)  Limited,  an India company,
in an aggregate principal amount at any time not exceeding $80,000,000;  and (i)
other  Debt  (which,  in the  case of any  Borrower,  shall  be  unsecured)  not
exceeding (1) in the case of the Borrowers,  together with, without duplication,
Guaranties by the Borrowers permitted under Section 7.11(h)(l),  $150,000,000 in
aggregate  principal  amount at any time  outstanding and (2) in the case of the
Other Subsidiaries,  together with, without duplication, Guaranties by the Other
Subsidiaries  permitted  by Section  7.11(h)(2),  $75,000,000  in the  aggregate
principal amount at any time outstanding. The aggregate amount of lease payments
under synthetic  leases entered into following the Closing Date shall not exceed
(a)  $25,000,000  in the case of synthetic  leases entered into by the Borrowers
and (b)  $20,000,000  in the case of synthetic  leases entered into by the Other
Subsidiaries.

7.13 Prepayment.  No Borrower shall voluntarily prepay any Debt (or apply to the
Bankruptcy  Court for  authority  to do so without  the  Agent's  prior  written
consent,  provided  that any  application  consented  to by the  Agent  shall be
abandoned  and  withdrawn  at the  request of the Agent or if the consent of the
Lenders  required  hereunder  to the  taking  of the  action(s)  to  which  such
application  relates is not  obtained),  except (i) any  Borrower may prepay the
Obligations in accordance  with the terms of this  Agreement,  (ii) any Borrower
may prepay Debt of such Borrower to any other  Borrower,  (iii) any Borrower may
prepay Debt permitted  hereunder:  (a) from the proceeds of new Debt (other than
the Obligations)  incurred to refinance such Debt and permitted  hereunder to be
incurred,  (b) under Capital Leases for property no longer used by the Borrowers
in connection  with the  settlement,  termination  or assignment of such Capital
Lease, (c) secured by assets in connection with any sale or other disposition of
such assets  permitted  hereunder to the extent such prepayment is financed with
the proceeds of such sale or disposition, or (d) consisting of Capital Leases as
long as such  Capital  Leases  are  paid in full in  connection  with  any  such
prepayment  and  such  prepayment  is made in  connection  with  the sale of the
property  subject to such Capital  Lease,  and (iv) the Company may prepay up to
$10,000,000  in  prepetition   indebtedness  with  respect  to  precious  metals
synthetic  leases between the Company,  as lessee,  and Gerald Metals,  Inc., as
lessor,  in connection  with the termination of all or a portion of the lessor's
interest in the precious metals subject to such leases.

7.14  Transactions  with  Affiliates.  Except as set forth on Schedule  7.14 and
except as set forth below, no Borrower shall sell, transfer,  distribute, or pay
any money or  property,  including,  but not limited to, any fees or expenses of
any nature  (including,  but not limited to, any fees or expenses for management
services),  to any  Affiliate,  or lend or  advance  money  or  property  to any
Affiliate,  or invest in (by capital  contribution  or otherwise) or purchase or
repurchase any stock or  indebtedness,  or any property,  of any  Affiliate,  or
become  liable  on  any  Guaranty  of  the  indebtedness,  dividends,  or  other
obligations of any Affiliate, unless such transaction is (a) otherwise permitted
under this Agreement or (b) entered into in the ordinary  course of business and
upon  terms no less  favorable  to such  Borrower  than would be  obtained  in a
comparable arm's-length transaction with a third party who is not an Affiliate.

7.15  Investment  Banking and  Finder's  Fees.  The  Borrowers  shall defend and
indemnify  the Agent and the  Lenders  against and hold them  harmless  from all
claims of any Person that any  Borrower is  obligated  to pay to such Person for
any investment  banking or similar or related fee,  underwriter's  fee, finder's
fee or broker's fee in connection with this Agreement,  and all reasonable costs
and expenses (including reasonable attorneys' fees) incurred by the Agent and/or
any Lender in connection therewith.

7.16 Business  Conducted.  No Borrower  shall,  nor shall any Borrower  cause or
permit any Other  Subsidiary  to,  engage  directly or indirectly in any line of
business other than the businesses in which the Company and its Subsidiaries are
engaged on the Closing Date and businesses related or similar thereto or entered
into in connection therewith.

7.17 Liens. No Borrower shall create, incur, assume, or permit to exist any Lien
on any  property  now owned or  hereafter  acquired  by any of them,  except (a)
Permitted  Liens,  (b)  Liens,  if any,  in  effect as of the  Closing  Date and
described in Schedule 6.7 securing Debt  described in Schedule 6.7 and (c) Liens
securing Capital Leases and purchase money Debt permitted in Section 7.12(c).

7.18     [Intentionally Omitted.]
          ---------------------

7.19     [Intentionally Omitted.]

7.20     Fiscal Year.  The Borrowers shall not change their Fiscal Year.
         -----------

7.21 Consolidated  EBITDA.  The Company and its consolidated  Subsidiaries shall
have  Consolidated  EBITDA of not less than the following amounts measured as of
the last day of each fiscal quarter for the following respective periods:
<TABLE>
<S>                                                                                   <C>
                  Period                                                       Consolidated EBITDA
                  ------                                                       -------------------
  October 1, 2000 through December 31, 2000                                    $ 90,000,000
  October 1, 2000 through March 31, 2001                                       $170,000,000
  October 1, 2000 through June 30, 2001                                        $270,000,000
  October 1, 2000 through September 30, 2001                                   $385,000,000
  Fiscal Year ending December 31, 2001                                         $400,000,000
  Trailing  four fiscal  quarters  ending on March 31, 2002                    $410,000,000
  and on the last day of each fiscal quarter thereafter
</TABLE>


7.22     [Intentionally Omitted.]
          ---------------------

7.23 Use of Proceeds.  No Borrower shall,  nor shall the Company cause or permit
any Other  Subsidiary  to, use any  portion of the Loan  proceeds,  directly  or
indirectly,  (i) to purchase or carry Margin  Stock,  (ii) to repay or otherwise
refinance  indebtedness  of any Borrower or others incurred to purchase or carry
Margin  Stock,  (iii) to extend credit for the purpose of purchasing or carrying
any Margin  Stock,  or (iv) to acquire any security in any  transaction  that is
subject to Section 13 or 14 of the  Exchange  Act or for any purpose  other than
working capital and other general corporate purposes.

7.24 Further Assurances. Each Borrower shall execute and deliver, or cause to be
executed  and  delivered,  to the Agent and/or the Lenders  such  documents  and
agreements,  and shall take or cause to be taken such  actions,  as the Agent or
any Lender may, from time to time, reasonably request to carry out the terms and
conditions of this Agreement and the other Loan Documents.

7.25 Section 364(c)(1) Superpriority  Administrative Claim. (a) (a) Effective on
and  after  the date of the entry by the  Bankruptcy  Court of the Final  Order,
notwithstanding  any term to the contrary  herein,  in  accordance  with section
364(c)(1) and the Bankruptcy Code, the Obligations  shall constitute claims (the
"Superpriority  Administrative  Claims")  with  priority  in  payment  from  the
Borrowers' assets, whether now existing or hereafter acquired,  over any and all
unsecured  pre-petition  claims, all post-petition claims and all administrative
expenses of the kinds  specified in, or arising or ordered under any sections of
the Bankruptcy Code, including,  without limitation,  sections 503(b), 105, 326,
328, 330, 331, 506(c),  507(a),  507(b),  546(c), 726 and 1112 of the Bankruptcy
Code,  whether or not such claims or expenses  may become  secured by a judgment
lien or other  non-consensual  lien, levy or attachment,  and the  Superpriority
Administrative  Claims  shall  at all  times  be  senior  to the  rights  of the
Borrowers,  any Chapter 11 trustee, any Chapter 7 trustee, or any other creditor
(including,  without limitation,  post-petition  vendors and other post-petition
creditors)  in the  Bankruptcy  Cases or any  subsequent  proceedings  under the
Bankruptcy Code,  including,  without limitation,  any chapter 7 cases if any of
the  Borrowers'  cases are converted to cases under chapter 7 of the  Bankruptcy
Code,  subject only to the Carve-Out (as defined  below),  valid and  unvoidable
liens or security  interests to the extent and in the amounts existing as of the
commencement  of the  Bankruptcy  Cases and Liens  permitted  under Section 7.17
hereof.  No cost or expense of  administration  under  sections 105,  364(c)(1),
503(b),  506(c),  507(b)  of the  Bankruptcy  Code,  any  other  section  of the
Bankruptcy Code, or pursuant to any order of the Bankruptcy Court other than the
Final  Order  (whether  entered  prior  to,  on,  or after the date of the Final
Order),  shall be senior to,  equal to, or pari passu  with,  the  Superpriority
Administrative  Claim of the Lenders arising out of the Obligations,  whether or
not such  claims or  expenses  may become  secured  by a judgment  lien or other
non-consensual lien, levy or attachment (subject only to the Carve-Out). As long
as no unwaived  Event of Default has occurred  (each a "Carve-Out  Event"),  the
Borrowers  shall  be  permitted  to pay  allowed  unpaid  professional  fees and
disbursements  as the same may be due and payable,  and such payments  shall not
reduce the Carve-Out.

(b) The Superpriority Administrative Claim referred to in clause (a) above shall
be subject only to (1) prior to the occurrence of a Carve-Out Event, the payment
of allowed unpaid professional fees and disbursements  incurred by the Borrowers
and statutory  committees  appointed in the Bankruptcy  Cases, (2) following the
occurrence and during the pendency of a Carve-Out  Event, the payment of allowed
and unpaid professional fees and disbursements incurred after the occurrence and
during  the  pendency  of a  Carve-Out  Event  by the  Borrowers  and  statutory
committees  appointed  in the  Bankruptcy  Cases in an  aggregate  amount not in
excess of $10,000,000, (3) the payment of fees pursuant to 28 U.S.C. ss.1930 and
fees  payable to the clerk of the  Bankruptcy  Court and any agent  thereof (the
amount under this  clause(3),  together  with the amounts  under clauses (1) and
(2),collectively the "Carve-Out") and (4) valid and unavoidable allowed liens or
security  interests  to  the  extent  and  in  the  amounts  existing  as of the
commencement of the Bankruptcy Cases and Liens permitted under Section 7.17.

7.26     Borrowers' Accounts.
         -------------------

(a) The  Borrowers  hereby  jointly and  severally  represent and warrant to the
Agent and the  Lenders,  with respect to the  Accounts  owned by each  Borrower,
that,  except as otherwise  disclosed to the Agent: (i) each existing Account of
such Borrower  represents,  and each future Account will represent,  a bona fide
sale or lease and delivery of goods by such Borrower or rendition of services by
such Borrower;  (ii) each existing  Account of such Borrower is, and each future
Account will be, for a liquidated  amount  payable by the Account Debtor thereon
on the  terms set  forth in the  invoice  therefor  or in the  schedule  thereof
delivered to the Agent;  (iii) no payment  will be received  with respect to any
Account, and no credit,  discount,  or extension,  or agreement therefor will be
granted  on any  Account,  except as  reported  to the Agent and the  Lenders in
accordance  with this Agreement;  (iv) each copy of an invoice  delivered to the
Agent by any Borrower will be a genuine copy of the original invoice sent to the
Account  Debtor  named  therein;  and (v) all  goods  described  in any  invoice
representing  a sale of goods will have been delivered to the Account Debtor and
all services of the applicable Borrower described in each invoice will have been
performed.

(b) No  Borrower  shall  re-date  any  invoice or sale or make sales on extended
dating beyond that which is customary in such  Borrower's  business or extend or
modify any Account owned by any Borrower.  If any Borrower  becomes aware of any
matter  adversely  affecting  the  collectibility  of any  Account  owned by any
Borrower  or the  Account  Debtor  therefor  involving  an amount  greater  than
$2,000,000,    including    information    regarding   the   Account    Debtor's
creditworthiness, the Borrower Representative will promptly so advise the Agent.

(c) The Borrower  Representative shall notify the Agent promptly of all disputes
and claims in excess of $2,000,000 with any Account Debtor of any Borrower,  and
the Borrower Representative agrees to settle, contest, or adjust such dispute or
claim at no expense to the Agent or any Lender.

(d) If an Account Debtor of any Borrower returns any Inventory to such Borrower,
then the applicable Borrower shall promptly determine the reason for such return
and shall issue a credit  memorandum  to the Account  Debtor in the  appropriate
amount.  Whenever any Inventory of any Borrower is returned, the related Account
shall be deemed  ineligible  to the  extent of the amount  owing by the  Account
Debtor with respect to such returned Inventory.

7.27     Inventory; Records.
         ------------------

                  The Borrowers  jointly and severally  represent and warrant to
the Agent and the Lenders and agree with the Agent and the Lenders that,  except
as otherwise  disclosed to the Agent all of the Inventory owned by each Borrower
is and will be held for sale or lease, or to be furnished in connection with the
rendition  of  services,  in the ordinary  course of the  applicable  Borrower's
business, and is and will be fit for such purposes.  Each Borrower will keep its
Inventory  in good and  marketable  condition,  except for damaged or  defective
goods arising in the ordinary course of such Borrower's business.  The Borrowers
agree that all  Inventory  produced  by the  Borrowers  in the United  States of
America will be produced in accordance with the Federal Fair Labor Standards Act
of 1938, as amended, and all rules, regulations, and orders thereunder.

ARTICLE 8
                              CONDITIONS OF LENDING

8.1 Conditions  Precedent to Making of Initial Loans. The  effectiveness of this
Agreement on the Closing Date is subject to the following  conditions  precedent
having been satisfied in a manner reasonably  satisfactory to the Agent and each
Lender on the Closing Date:

(a) This Agreement and the other Loan Documents shall have been executed by each
party  thereto,  the  Borrowers  shall  have  performed  and  complied  with all
covenants,  agreements  and  conditions  contained  herein  and the  other  Loan
Documents  which are required to be performed or complied  with by the Borrowers
before or on such Closing  Date and the  Borrowers  shall have  delivered to the
Agent  the  documents,  certificates  and  requirements  listed  on the  closing
checklist delivered to the Borrowers by the Agent.

(b) All  representations  and  warranties  made  hereunder and in the other Loan
Documents shall be true and correct in all material  respects as if made on such
date.

(c) No Default or Event of Default shall have  occurred and be continuing  after
giving  effect to the Loans to be made and the Letters of Credit to be issued on
the Closing Date.

(d) The Borrowers  shall have paid all reasonable fees and expenses of the Agent
and the Attorney Costs incurred in connection with any of the Loan Documents and
the transactions contemplated thereby to the extent invoiced.

(e) The Agent shall have received certificates of insurance, in form, scope, and
substance,  reasonably  satisfactory  to the  Agent,  evidencing  all  insurance
coverage as required by this Agreement.

(f) The Agent shall have had an  opportunity,  if it so chooses,  to examine the
books of account and other records and files of the Borrowers and to make copies
thereof,  and to  conduct a  pre-closing  audit  which  shall  include,  without
limitation, verification of Inventory, Accounts, and the Borrowing Base, and the
results of such examination and audit shall have been  satisfactory to the Agent
and the Lenders in all respects.

(g) All  proceedings  taken in connection  with the execution of this Agreement,
the Revolving  Loan Notes (if any),  all other Loan  Documents and all documents
and papers relating thereto shall be reasonably satisfactory in form, scope, and
substance to the Agent and the Lenders.

(h) The Agent shall have  received the results of UCC-1 and other Lien  searches
requested by the Agent  against the  Borrowers  (in each case dated as of a date
reasonably  satisfactory to the Agent), which searches shall reflect the absence
of Liens on the assets  (including  Inventory  and  Accounts) of the  Borrowers,
other  than Liens that are  satisfactory  to the Agent or for which  termination
statements and releases reasonably satisfactory to the Agent have been tendered.

(i) At the  time  of the  making  of the  initial  Loans  or at the  time of the
issuance of the initial Letters of Credit, whichever first occurs, the Agent and
the  Lenders  shall have  received  a  certified  copy (or such  other  evidence
reasonably  satisfactory to Agent and its counsel) of an order of the Bankruptcy
Court  substantially in the form of Exhibit F (the "Final Order"),  which (i) as
entered,  shall be acceptable in form and substance to the Agent,  approving the
Loan  Documents  and  granting  the  Superpriority  Administrative  Claim status
described in Section 7.25 with the priority described  therein,  (ii) shall have
been entered upon an application  of the Borrowers  reasonably  satisfactory  in
form and  substance to the Agent and its  counsel,  (iii) shall be in full force
and effect and no Borrower shall have breached the terms thereof, and (iv) shall
not have been stayed, reversed,  rescinded,  modified, vacated or amended in any
respect.

(j) The Bankruptcy  Cases shall have been  commenced by the  Borrowers,  and the
Borrowers shall each be a debtor and debtor-in-possession.

(k) All orders entered in the Bankruptcy Cases on or prior to the date the Final
Order is entered shall be in form and substance  reasonably  satisfactory to the
Agent and its counsel.

                  The  acceptance  by the Borrowers of any Loans made or Letters
of Credit issued on the Closing Date shall be deemed to be a representation  and
warranty  made  by  the  Borrowers  to the  effect  that  all of the  conditions
precedent  to the making of such Loans or the issuance of such Letters of Credit
have  been  satisfied,  with the same  effect as  delivery  to the Agent and the
Lenders  of a  certificate  signed  by a  Responsible  Officer  of the  Borrower
Representative, dated the Closing Date, to such effect.

                  Execution  and  delivery  to  the  Agent  by  a  Lender  of  a
counterpart of this Agreement  shall be deemed  confirmation by such Lender that
(i) all  conditions  precedent  in this  Section 8.1 have been  fulfilled to the
satisfaction  of such  Lender,  (ii) the  decision of such Lender to execute and
deliver to the Agent an executed  counterpart of this Agreement was made by such
Lender independently and without reliance on the Agent or any other Lender as to
the  satisfaction of any condition  precedent set forth in this Section 8.1, and
(iii) all documents sent to such Lender for approval,  consent,  or satisfaction
were acceptable to such Lender.

8.2  Conditions  Precedent to Each Loan.  The  obligation of the Lenders to make
each Loan,  including the initial  Revolving  Loans on the Closing Date, and the
obligation of the Agent to cause the Letter of Credit Issuer to issue any Letter
of Credit shall be subject to the further conditions precedent that on and as of
the  date  of any  such  extension  of  credit  (provided,  however,  that  such
conditions  precedent  are not  conditions  to each Lender  participating  in or
reimbursing  the Bank or the  Agent  for  such  Lenders'  Pro Rata  Share of any
Non-Ratable Loan made in accordance with the provisions of Section 1.2(h) or for
any drawing under a Letter of Credit or payment under a Credit Support):

(a) the following  statements shall be true, and the acceptance by the Borrowers
of any  extension  of credit shall be deemed to be a statement to the effect set
forth in clauses (i) and (ii), with the same effect as the delivery to the Agent
and the Lenders of a certificate signed by a Responsible Officer of the Borrower
Representative, dated the date of such extension of credit, stating that:

(i) The representations and warranties contained in this Agreement and the other
Loan  Documents  are correct in all  material  respects on and as of the date of
such  extension of credit as though made on and as of such date,  other than any
such  representation  or warranty  which  relates to a specified  prior date and
except to the extent the Agent and the Lenders have been  notified in writing by
the Borrower  Representative  that any representation or warranty is not correct
and the Required Lenders have explicitly waived in writing  compliance with such
representation or warranty; and

(ii)     No event  has  occurred  and is  continuing,  or  would  result  from
such  extension  of  credit,  which constitutes a Default or an Event of
Default; and

(iii) No event  has  occurred  and is  continuing,  or would  result  from  such
extension  of credit,  which  would  reasonably  be  expected to have a Material
Adverse Effect.

(b)      Subject to the second sentence of Section 1.2(a)(i), no such Borrowing
shall exceed Availability.

(c) No order  shall have been  entered or sought by any  Borrower  in any of the
Bankruptcy  Cases,  (i) for the  appointment  of a trustee or receiver,  (ii) to
convert any Bankruptcy Case from a proceeding under chapter 11 of the Bankruptcy
Code to a proceeding under chapter 7 of the Bankruptcy Code, or (iii) to dismiss
any Bankruptcy Case.

(i) The Final  Order  shall be in full  force and effect and shall not have been
violated or breached by any Borrower,  stayed,  reversed,  rescinded,  modified,
vacated or amended in any respect without the consent of the Required Lenders.

(d) None of the  Bankruptcy  Cases shall have been  dismissed  or  converted  to
chapter 7 of the  Bankruptcy  Code, no Borrower  shall have filed an application
for  an  order  dismissing  its or  any  other  Borrower's  Bankruptcy  Case  or
converting its or any other Borrower's Bankruptcy Case to a case under chapter 7
of the  Bankruptcy  Code,  and no trustee  under  chapter 7 or chapter 11 of the
Bankruptcy Code shall have been appointed in any of the Bankruptcy Cases.

ARTICLE 9
                                DEFAULT; REMEDIES

9.1      Events of Default.  It shall  constitute  an event of default
("Event of Default")  if any one or more of the following shall occur for any
reason:

(a) (i) any failure by any Borrower to pay the  principal of any of the Loans or
to pay any  reimbursement  obligations  relating  to Letters of Credit or Credit
Supports when due, whether upon demand or otherwise,  or (ii) any failure by any
Borrower to pay any interest or premium on any of the Loans or any fees or other
Obligations  or other amount owing  hereunder  within three (3) Business Days of
the applicable due date, whether upon demand or otherwise;

(b) any  representation  or warranty made or deemed made by any Borrower in this
Agreement or in any of the other Loan Documents, any Financial Statement, or any
certificate furnished by any Borrower or any Other Subsidiary at any time to the
Agent or any Lender  pursuant to any Loan  Document  shall prove to be untrue in
any material respect as of the date on which made, deemed made, or furnished;

(c) (i) any default shall occur in the  observance or  performance of any of the
covenants  and  agreements  contained  in Section 7.2  (insofar as such  Section
relates to any Borrower) or Sections 7.8 through 7.25 (other than Section 7.24);
(ii) any default  shall occur in the  observance  or  performance  of any of the
covenants and agreements contained in Sections 5.2(k) or 5.3(a) and such default
shall  continue for three (3)  Business  Days or more;  (iii) any default  shall
occur in the  observance or  performance  of any of the covenants and agreements
contained in any of Sections 5.2(a),  5.2(b),  5.2(c),  7.26 or 7.27 for fifteen
(15) Business Days or more; or (iv) any default shall occur in the observance or
performance of any of the other  covenants or agreements  contained in any other
Section of this Agreement or any other Loan Document,  or any agreement  entered
into at any time to which any  Borrower and the Agent or any Lender are party in
respect of any Bank  Products,  and such default shall  continue for thirty (30)
days after the earlier of (1) the date upon which written notice of such default
is given to the Borrower Representative by the Agent and (2) the date upon which
a Responsible Officer becomes aware of such default;

(d) any Borrower shall file a certificate of dissolution  under applicable state
law or shall be  liquidated,  dissolved or wound-up or shall commence any action
or proceeding  for  dissolution,  winding-up or  liquidation,  or shall take any
corporate action in furtherance thereof;

(e) all or any material part of the property of the Borrowers, taken as a whole,
shall  be   nationalized,   expropriated  or  condemned,   seized  or  otherwise
appropriated, or custody or control of such property or of any Borrower shall be
assumed by any Governmental  Authority or any court of competent jurisdiction at
the instance of any Governmental Authority, except where contested in good faith
by proper  proceedings  diligently  pursued  where a stay of  enforcement  is in
effect;

(f) Any Loan  Document  shall be terminated  (other than in accordance  with its
terms),  revoked or declared void or invalid or unenforceable or the validity or
enforceability thereof shall be challenged by any Borrower;

(g) any loss,  theft,  damage or  destruction of any property of any Borrower or
any Other Subsidiary occurs, or any Litigation is commenced against any Borrower
(or any change in the facts and circumstances of such Litigation occurs),  which
would  reasonably  be  expected  to cause a Material  Adverse  Effect and is not
adequately covered by insurance;

(h) there is filed against any Borrower or any Other Subsidiary action,  suit or
proceeding  under any  federal  or state  racketeering  statute  (including  the
Racketeer  Influenced and Corrupt  Organization Act of 1970), which action, suit
or proceeding  (i) is not  dismissed or stayed  within one hundred  twenty (120)
days,  and (ii) would  reasonably  be expected  to result in a Material  Adverse
Effect;

(i)  (i)  an  ERISA  Event  shall  occur  with  respect  to a  Pension  Plan  or
Multi-employer Plan which has resulted or would reasonably be expected to have a
Material Adverse Effect; (ii) the aggregate amount of Unfunded Pension Liability
among all Pension  Plans at any time exceeds an amount that would  reasonably be
expected to have a Material  Adverse Effect;  or (iii) any Borrower or any ERISA
Affiliate  shall fail to pay when due,  after the  expiration of any  applicable
grace period, any installment  payment with respect to its withdrawal  liability
under Section 4201 of ERISA under a  Multi-employer  Plan in an aggregate amount
that would reasonably be expected to have a Material Adverse Effect;

(j)      there occurs a Change of Control;

(k) any of the Bankruptcy  Cases shall be dismissed or converted to a case under
chapter 7 of the Bankruptcy  Code, or any Borrower shall file an application for
an  order  dismissing  any of the  Bankruptcy  Cases  or  converting  any of the
Bankruptcy  Cases to a case under  chapter 7 of the  Bankruptcy  Code; a trustee
under chapter 7 or chapter 11 of the  Bankruptcy  Code shall be appointed in any
of the Bankruptcy  Cases;  or an application  shall be filed by any Borrower for
the  approval of any other  Superpriority  Administrative  Claim (other than the
Carve-Out)  in any  Bankruptcy  Case  which is pari  passu with or senior to the
claims of the Agent and the Lenders against the Borrowers,  or there shall arise
any such pari passu or senior Superpriority  Administrative  Claim, or the Final
Order shall be stayed, modified, amended, reversed, rescinded or vacated without
the written consent of Agent;

(l) the Bankruptcy Court shall enter an order or orders granting relief from the
automatic stay applicable under Section 362 of the Bankruptcy Code to the holder
or holders of any security interest to permit  foreclosure (or the granting of a
deed in lieu of  foreclosure  or the like) in any assets of any Borrower;  or an
order  shall  be  entered  by the  Bankruptcy  Court  granting  relief  from the
automatic stay  applicable  under Section 362 of the Bankruptcy Code or from the
injunction  and stay set  forth in the  Final  Order  to  permit  the  creation,
perfection or enforcement of any judgment, lien, levy or attachment based on any
judgment,  whether  or  not  such  judgment  arises  from  or  gives  rise  to a
pre-petition  or  post-petition  claim;  or an  order  shall be  entered  by the
Bankruptcy  Court that is not stayed pending appeal  otherwise  granting  relief
from the  automatic  stay to any creditor of any Borrower  (other than the Agent
and the  Lenders  in  their  capacities  as such)  with  respect  to any  claim;
provided,  however,  that it shall not be an Event of Default if relief from the
automatic stay is lifted solely for the purpose of (i) allowing such creditor to
determine the liquidated amount of its claim against any Borrower;  (ii) seeking
payment  from a source  other than any of the  Borrowers  or any of their assets
(iii)   allowing  the  Company  to  prepay  up  to  $10,000,000  of  prepetition
indebtedness  with  respect to  precious  metals  synthetic  leases  between the
Company,  as lessee, and Gerald Metals,  Inc., as lessor, in connection with the
Company's  termination  of all or a  portion  of the  lessor's  interest  in the
precious metals subject to such lease; or (iv) allowing the foregoing actions to
be taken by the  holders  of  pre-petition  claims in an  aggregate  amount  not
exceeding $10,000,000 with respect to all such holders.

(m) an order of the  Bankruptcy  Court shall be entered in any of the Bankruptcy
Cases  appointing an examiner with enlarged  powers relating to the operation of
any  Borrower's  business under Section  1106(b) of the  Bankruptcy  Code or any
Borrower shall file an application for such an order;

(n)  an  order  by  the   Bankruptcy   Court  shall  be  entered   confirming  a
Reorganization  Plan in any of the  Bankruptcy  Cases  which does not  require a
provision for termination of the Commitments and indefeasible payment in full in
cash of all  Obligations  of the  Borrowers  hereunder  and under the other Loan
Documents (including the cancellation and return of all Letters of Credit or the
delivery of Supporting Letters of Credit or Cash Collateral with respect to such
Letters of Credit in accordance  with Section 1.4(g)) on or before the effective
date of such Reorganization Plan;

(o) an order by the Bankruptcy  Court shall be entered,  or the Borrowers  shall
file an application for an order,  dismissing any of the Bankruptcy  Cases which
does not require a provision for termination of the Commitments and indefeasible
payment in full in cash of all Obligations of the Borrowers  hereunder and under
the other Loan Documents  (including the  cancellation and return of all Letters
of Credit or the  delivery of  Supporting  Letters of Credit or Cash  Collateral
with respect to such Letters of Credit in accordance  with Section 1.4(g)) prior
to any such dismissal;

(p) an order by the Bankruptcy  Court shall be entered in or with respect to any
of the Bankruptcy  Cases or any Borrower shall file an application  for an order
with respect to any  Bankruptcy  Case,  in each case  without the express  prior
written consent of Agent, (i) to revoke, reverse, stay, rescind, modify, vacate,
supplement or amend the Final Order, (ii) to permit any  administrative  expense
or any  claim  (now  existing  or  hereafter  arising,  of any  kind  or  nature
whatsoever)  to have an  administrative  priority  as to any  Borrower  equal or
superior  to the  priority of the claims of the Agent and the Lenders in respect
of the Obligations  (other than the Carve-Out),  or (iii) to grant or permit the
grant of a Lien on the  property of any  Borrower  (other  than Liens  permitted
under Section 7.17);

(q) an  application  for any of the orders  described  above  shall be made by a
Person  other than a  Borrower  and such  application  is not  contested  by the
applicable  Borrower  in good  faith and the relief  requested  is granted in an
order that is not stayed pending appeal; or

(r)      any Borrower shall violate or fail to comply with the Final Order.

9.2      Remedies.
         --------

(a)  If a  Default  or an  Event  of  Default  exists,  the  Agent  may,  in its
discretion, and shall, at the direction of the Required Lenders, without further
order of or application to the Bankruptcy Court as permitted by the Final Order,
do one or more of the  following at any time or times and in any order,  without
notice to or demand on any Borrower:  (i) reduce the Maximum Revolver Amount, or
the advance rates against  Eligible  Accounts and/or Eligible  Inventory used in
computing the Borrowing  Base, or reduce one or more of the other  elements used
in computing the Borrowing  Base;  (ii) restrict the amount of or refuse to make
Revolving  Loans;  and (iii) restrict or refuse to provide  Letters of Credit or
Credit Support. If an Event of Default exists, the Agent shall, at the direction
of the Required  Lenders,  do one or more of the  following,  in addition to the
actions  described in the  preceding  sentence,  at any time or times and in any
order,  without  notice  to  or  demand  on  any  Borrower:  (A)  terminate  the
Commitments  and  this  Agreement;  (B)  declare  any or all  Obligations  to be
immediately due and payable; provided,  however, that upon the occurrence of any
Event of Default  described in Sections 9.1(k),  (l), (m), (n), (o), (p) or (q),
the Commitments shall  automatically and immediately  expire and all Obligations
shall automatically  become immediately due and payable without notice or demand
of any kind;  (C) require the Borrowers to cash  collateralize  all  outstanding
Letters of Credit;  and (D) pursue its other rights and remedies  under the Loan
Documents and applicable laws.

(b) If an Event of Default has occurred and is continuing,  the Agent shall have
for the benefit of the Lenders, in addition to all other rights of the Agent and
the Lenders,  the rights and remedies of a creditor under applicable  bankruptcy
and non-bankruptcy law.

(c) If an Event of Default  occurs,  the  Borrowers  hereby  waive all rights to
notice and hearing  prior to the  exercise  by the Agent of the  Agent's  rights
without  judicial  process  to attach or levy upon  property  without  notice or
hearing.

(d) If an Event of Default has  occurred and is  continuing,  and subject to any
notice  requirements  set forth in the Final Order,  all stays and  injunctions,
including the automatic  stay pursuant to Bankruptcy  Code section 362, shall be
vacated  and  terminated  by the Final  Order and this  Agreement  to the extent
necessary  to permit the Agent and the  Lenders  full  exercise  of all of their
rights and  remedies,  including,  without  limitation,  all of their rights and
remedies with respect to the  Borrowers'  property.  With respect to the Agent's
and Lenders'  exercise of their rights and  remedies,  the  Borrowers  agree and
warrant as follows:

(i) the  Borrowers  waive,  release,  and shall be enjoined  from  attempting to
contest,  delay, or otherwise  dispute the exercise by the Agent and the Lenders
of their rights and remedies  before the Bankruptcy  Court or otherwise;  except
only as expressly stated in subparagraph (ii) of this paragraph; and

(ii) when any Agent or Lender seeks to enforce its rights and remedies  based on
an Event of Default,  and if any Borrower  disputes that an Event of Default has
occurred,  the Borrowers  will be entitled to file an emergency  motion with the
Bankruptcy  Court  disputing  whether an Event of Default has  occurred.  Unless
otherwise  agreed in writing by Agent, any such motion shall be heard within two
(2) Business Days after it is filed. At the hearing on the emergency motion, the
only issue that will be heard by the  Bankruptcy  Court will be whether an Event
of Default has occurred and has not been cured, and, unless the Bankruptcy Court
issues an order in connection with such hearing finding that no Event of Default
has  occurred and is  continuing,  the Agent and the Lenders will be entitled to
continue to exercise all of their rights and remedies  without the  necessity of
any further notice or order.  Furthermore,  nothing herein shall be construed to
impose or reimpose any stay or  injunction  of any kind against the Agent or the
Lenders.

ARTICLE 10
                                               TERM AND TERMINATION
10.1 Term and  Termination.  The term of this Agreement  shall end on the Stated
Termination  Date unless sooner  terminated in accordance with the terms hereof.
The Agent upon direction from the Required  Lenders may terminate this Agreement
without  notice upon the  occurrence  and during the  continuance of an Event of
Default. Upon the effective date of termination of this Agreement for any reason
whatsoever, all Obligations (including all unpaid principal,  accrued and unpaid
interest and any early termination or prepayment fees or penalties) shall become
immediately due and payable and the Borrowers shall immediately  arrange for the
cancellation  and return of Letters of Credit then  outstanding (or the delivery
of Supporting  Letters of Credit or Cash  Collateral in accordance  with Section
14(g).  Notwithstanding the termination of this Agreement, until all Obligations
are indefeasibly  paid and performed in full in cash, each Borrower shall remain
bound by the terms of this  Agreement  and shall not be  relieved  of any of its
Obligations  hereunder or under any other Loan  Document,  and the Agent and the
Lenders shall retain all their rights and remedies hereunder.

ARTICLE 11
          AMENDMENTS; WAIVERs; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS

11.1     Amendments and Waivers.
         ----------------------

(a) No amendment or waiver of any provision of this  Agreement or any other Loan
Document,  and no  consent  with  respect  to  any  departure  by  any  Borrower
therefrom,  shall be effective unless the same shall be in writing and signed by
the  Required  Lenders (or by the Agent at the written  request of the  Required
Lenders) and each  Borrower (or the Borrower  Representative)  and then any such
waiver or consent shall be effective  only in the specific  instance and for the
specific  purpose  for which  given;  provided,  however,  that no such  waiver,
amendment, or consent shall, unless in writing and signed by all the Lenders and
each Borrower (or the Borrower Representative) and acknowledged by the Agent, do
any of the following:

(i)      increase or extend the Commitment of any Lender;

(ii)  postpone  or delay any date  fixed by this  Agreement  or any  other  Loan
Document for any payment of  principal,  interest,  fees or other amounts due to
the Lenders (or any of them) hereunder or under any other Loan Document;

(iii) reduce the principal of, or the rate of interest  specified herein on, any
Loan, or any fees payable hereunder or under any other Loan Document;

(iv)     change the percentage of the Commitments or of the aggregate  unpaid
principal  amount of the Loans which is required for the Lenders or any of them
to take any action hereunder;

(v)      increase any of the percentages set forth in the definition of the
Borrowing Base;

(vi)     amend this  Section or any  provision  of this  Agreement  providing
for  consent or other  action by all Lenders;

(vii)    change the definitions of "Majority Lenders" or "Required Lenders"; or

(viii)   increase  the  Maximum  Revolver  Amount,  the  Maximum  Inventory
Loan  Amount,  and  Letter  of  Credit Subfacility;

provided, however, that no amendment, waiver or consent shall, unless in writing
and  signed by the Agent,  affect  the rights or duties of the Agent  under this
Agreement or any other Loan  Document and provided  further,  that  Schedule 1.1
hereto  (Commitments)  may be  amended  from time to time by the Agent  alone to
reflect assignments of Commitments in accordance herewith.

(b) If any fees are paid to the Lenders as consideration for amendments, waivers
or consents with respect to this Agreement,  at Agent's election,  such fees may
be paid only to those Lenders that agree to such amendments, waivers or consents
within the time specified for submission thereof.

(c)      If, in connection with any proposed amendment, waiver or consent (a
"Proposed Change"):

(i)  requiring  the consent of all Lenders,  the consent of Required  Lenders is
obtained,  but the  consent of other  Lenders is not  obtained  (any such Lender
whose consent is not obtained as described in this clause (i) and in clause (ii)
below being referred to as a "Non-Consenting Lender"), or

(ii)     requiring the consent of Required Lenders, the consent of Majority
Lenders is obtained,

then,  so long as the  Agent is not a  Non-Consenting  Lender,  at the  Borrower
Representative's request, the Agent or an Eligible Assignee shall have the right
(but not the  obligation)  with  the  Agent's  approval,  to  purchase  from the
Non-Consenting  Lenders,  and the  Non-Consenting  Lenders agree that they shall
sell, all the  Non-Consenting  Lenders'  Commitments  for an amount equal to the
principal  balances  thereof and all accrued and unpaid  interest  and fees with
respect  thereto  through the date of sale pursuant to Assignment and Acceptance
Agreement(s), without premium or discount.

11.2     Assignments; Participations.
         ---------------------------

(a) Any Lender may, with the written  consent of the Agent (which  consent shall
not be  unreasonably  withheld  or  delayed)  and the  consent  of the  Borrower
Representative  (which consent shall not be unreasonably withheld or delayed and
which  consent shall not be required so long as an Event of Default has occurred
and is  continuing),  assign  and  delegate  to one or more  Eligible  Assignees
(provided that no consent of the Agent or the Borrower  Representative  shall be
required in  connection  with any  assignment  and  delegation by a Lender to an
Affiliate of such Lender) (each an "Assignee")  all, or any ratable part of all,
of the Loans,  the  Commitments  and the other  rights and  obligations  of such
Lender hereunder,  in a minimum amount of $10,000,000  (provided that, unless an
assignor Lender has assigned and delegated all of its Loans and Commitments,  no
such assignment and/or delegation shall be permitted unless, after giving effect
thereto,  such  assignor  Lender  retains a  Commitment  in a minimum  amount of
$10,000,000; provided, however, that the Borrowers and the Agent may continue to
deal solely and  directly  with such Lender in  connection  with the interest so
assigned to an Assignee  until (i) written notice of such  assignment,  together
with payment instructions, addresses and related information with respect to the
Assignee,  shall have been given to the Borrower Representative and the Agent by
such  Lender and the  Assignee;  (ii) such  Lender and its  Assignee  shall have
delivered  to the  Borrower  Representative  and the  Agent  an  Assignment  and
Acceptance in the form of Exhibit H ("Assignment and Acceptance")  duly executed
by such Lender and its Assignee, together with any note or notes subject to such
assignment,  and such Assignment and Acceptance shall have been  acknowledged by
the Agent and, if  required  hereunder,  the  Borrower;  and (iii) the  assignor
Lender or  Assignee  has paid to the  Agent a  processing  fee in the  amount of
$3,500. Borrowers agree to promptly execute and deliver new promissory notes and
replacement  promissory  notes as reasonably  requested by the Agent to evidence
assignments of the Loans and Commitments in accordance herewith.

(b) From and after the date that the Agent notifies the assignor  Lender that it
has  received  an  executed   Assignment  and  Acceptance  and  payment  of  the
above-referenced  processing fee, (i) the Assignee  thereunder  shall be a party
hereto  and,  to the extent  that  rights and  obligations,  including,  but not
limited  to,  the  obligation  to  participate  in  Letters of Credit and Credit
Support have been  assigned to it pursuant to such  Assignment  and  Acceptance,
shall have the rights and obligations of a Lender under the Loan Documents,  and
(ii) the  assignor  Lender  shall,  to the extent  that  rights and  obligations
hereunder and under the other Loan  Documents  have been assigned by it pursuant
to such  Assignment and  Acceptance,  relinquish its rights and be released from
its  obligations  under this  Agreement  (and in the case of an  Assignment  and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and  obligations  under this  Agreement,  such Lender  shall cease to be a party
hereto).

(c) By executing  and  delivering an Assignment  and  Acceptance,  the assigning
Lender  thereunder  and the Assignee  thereunder  confirm to and agree with each
other and the other  parties  hereto as  follows:  (i) other than as provided in
such Assignment and Acceptance, such assigning Lender makes no representation or
warranty  and  assumes  no  responsibility   with  respect  to  any  statements,
warranties or  representations  made in or in connection  with this Agreement or
the execution, legality, validity, enforceability,  genuineness,  sufficiency or
value of this Agreement or any other Loan Document  furnished  pursuant  hereto;
(ii) such assigning  Lender makes no  representation  or warranty and assumes no
responsibility  with respect to the  financial  condition of any Borrower or the
performance or observance by any Borrower of any of its  obligations  under this
Agreement  or any other Loan  Document  furnished  pursuant  hereto;  (iii) such
Assignee  confirms that it has received a copy of this Agreement,  together with
such other  documents and  information as it has deemed  appropriate to make its
own credit  analysis and decision to enter into such  Assignment and Acceptance;
(iv) such Assignee will, independently and without reliance upon the Agent, such
assigning  Lender  or  any  other  Lender,  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 action under this Agreement;  (v) such
Assignee  appoints and  authorizes the Agent to take such action as agent on its
behalf and to exercise such powers under this  Agreement as are delegated to the
Agent  by  the  terms  hereof,   together   with  such  powers,   including  the
discretionary rights and incidental power, as are reasonably incidental thereto;
and (vi) such  Assignee  agrees that it will  perform in  accordance  with their
terms all of the  obligations  which by the terms of this Agreement are required
to be performed by it as a Lender.

(d) Immediately upon  satisfaction of the requirements of Section 11.2(a),  this
Agreement  shall be deemed to be amended to the extent,  but only to the extent,
necessary to reflect the addition of the Assignee and the  resulting  adjustment
of the Commitments arising therefrom.  The Commitment allocated to each Assignee
shall reduce such Commitments of the assigning Lender pro tanto.

(e) Any  Lender  may at any time sell to one or more  commercial  banks or other
financial institutions (a "Participant")  participating  interests in any Loans,
the  Commitment  of that  Lender and the other  interests  of that  Lender  (the
"originating  Lender")  hereunder and under the other Loan Documents;  provided,
however,  that (i) the  originating  Lender's  obligations  under this Agreement
shall  remain  unchanged,  (ii)  the  originating  Lender  shall  remain  solely
responsible for the performance of such obligations, (iii) the Borrowers and the
Agent shall continue to deal solely and directly with the originating  Lender in
connection  with the  originating  Lender's  rights and  obligations  under this
Agreement  and the other Loan  Documents,  and (iv) no Lender shall  transfer or
grant any  participating  interest  under  which the  Participant  has rights to
approve  any  amendment  to, or any  consent or waiver  with  respect  to,  this
Agreement or any other Loan Document,  and all amounts  payable by the Borrowers
hereunder shall be determined as if such Lender had not sold such participation;
except that, if amounts  outstanding under this Agreement are due and unpaid, or
shall have become due and payable  upon the  occurrence  of an Event of Default,
each Participant  shall be deemed to have the right of set-off in respect of its
participating  interest in amounts owing under this Agreement to the same extent
and  subject  to the  same  limitation  as if the  amount  of its  participating
interest were owing directly to it as a Lender under this Agreement.

(f) Notwithstanding any other provision in this Agreement, any Lender may at any
time create a security interest in, or pledge,  all or any portion of its rights
under and  interest in this  Agreement  in favor of any Federal  Reserve Bank in
accordance  with  Regulation  A of the FRB or U.S.  Treasury  Regulation  31 CFR
ss.203.14,  and such  Federal  Reserve  Bank may enforce such pledge or security
interest in any manner permitted under applicable law.

ARTICLE 12
                                                     THE AGENT
12.1 Appointment and  Authorization.  Each Lender hereby designates and appoints
Bank as its Agent under this  Agreement  and the other Loan  Documents  and each
Lender hereby irrevocably authorizes the Agent to take such action on its behalf
under the  provisions  of this  Agreement  and each other Loan  Document  and to
exercise such powers and perform such duties as are expressly delegated to it by
the terms of this  Agreement  or any other  Loan  Document,  together  with such
powers as are reasonably  incidental thereto. The Agent agrees to act as such on
the express  conditions  contained  in this Article 12. The  provisions  of this
Article 12 are solely for the  benefit of the Agent and the  Lenders and none of
the Borrowers  shall have any rights as a third party  beneficiary of any of the
provisions  contained  herein.  Notwithstanding  any  provision  to the contrary
contained  elsewhere in this Agreement or in any other Loan Document,  the Agent
shall not have any duties or responsibilities,  except those expressly set forth
herein, nor shall the Agent have or be deemed to have any fiduciary relationship
with any Lender, and no implied covenants, functions, responsibilities,  duties,
obligations or  liabilities  shall be read into this Agreement or any other Loan
Document or otherwise exist against the Agent.  Without  limiting the generality
of the foregoing  sentence,  the use of the term "agent" in this  Agreement with
reference to the Agent is not intended to connote any fiduciary or other implied
(or express)  obligations  arising under agency  doctrine of any applicable law.
Instead,  such term is used merely as a matter of market custom, and is intended
to create or reflect only an  administrative  relationship  between  independent
contracting  parties.  Except as expressly otherwise provided in this Agreement,
the Agent shall have and may use its sole  discretion with respect to exercising
or refraining from exercising any  discretionary  rights or taking or refraining
from taking any actions which the Agent is expressly  entitled to take or assert
under  this  Agreement  and  the  other  Loan   Documents,   including  (a)  the
determination of the applicability of ineligibility criteria with respect to the
calculation of the Borrowing  Base and (b) the exercise of remedies  pursuant to
Section 9.2,  and any action so taken or not taken shall be deemed  consented to
by the Lenders.

12.2  Delegation  of Duties.  The Agent may execute any of its duties under this
Agreement  or any  other  Loan  Document  by or  through  agents,  employees  or
attorneys-in-fact  and shall be  entitled  to advice of counsel  concerning  all
matters  pertaining to such duties.  The Agent shall not be responsible  for the
negligence  or misconduct  of any agent or  attorney-in-fact  that it selects as
long as such selection was made without gross negligence or willful misconduct.

12.3 Liability of Agent. None of the  Agent-Related  Persons shall (i) be liable
for  any  action  taken  or  omitted  to be  taken  by any of them  under  or in
connection  with this  Agreement or any other Loan Document or the  transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (ii) be  responsible  in any manner to any of the  Lenders  for any  recital,
statement,  representation  or  warranty  made  by any  Borrower  or  any  Other
Subsidiary or Affiliate of any Borrower,  or any officer  thereof,  contained in
this Agreement or in any other Loan  Document,  or in any  certificate,  report,
statement or other  document  referred to or provided for in, or received by the
Agent under or in connection with, this Agreement or any other Loan Document, or
the validity, effectiveness,  genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document,  or for any failure of any Borrower or any
other  party to any Loan  Document  to  perform  its  obligations  hereunder  or
thereunder.  No Agent-Related Person shall be under any obligation to any Lender
to ascertain or to inquire as to the  observance  or  performance  of any of the
agreements  contained  in, or  conditions  of, this  Agreement or any other Loan
Document, or to inspect the properties,  books or records of any Borrower or any
Other Subsidiaries or Affiliates.

12.4 Reliance by Agent.  The Agent shall be entitled to rely, and shall be fully
protected  in  relying,   upon  any  writing,   resolution,   notice,   consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement  or other  document or  conversation  believed by it to be genuine and
correct and to have been signed,  sent or made by the proper  Person or Persons,
and upon  advice  and  statements  of legal  counsel  (including  counsel to the
Borrowers), independent accountants and other experts selected by the Agent. The
Agent shall be fully  justified  in failing or refusing to take any action under
this  Agreement or any other Loan  Document  unless it shall first  receive such
advice or concurrence of the Required Lenders as it deems appropriate and, if it
so requests,  it shall first be indemnified to its  satisfaction  by the Lenders
against any and all  liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement or
any other Loan Document in accordance  with a request or consent of the Required
Lenders (or all Lenders if so required by Section 11.1) and such request and any
action taken or failure to act pursuant thereto shall be binding upon all of the
Lenders.

12.5  Notice of  Default.  The Agent  shall not be deemed to have  knowledge  or
notice of the  occurrence  of any Default or Event of Default,  unless the Agent
shall have received written notice from a Lender or the Borrower  Representative
referring  to this  Agreement,  describing  such Default or Event of Default and
stating  that such  notice is a "notice of  default."  The Agent will notify the
Lenders of its receipt of any such notice. The Agent shall take such action with
respect to such  Default or Event of Default as may be requested by the Required
Lenders in accordance with Section 9; provided,  however,  that unless and until
the Agent  has  received  any such  request,  the  Agent  may (but  shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable.

12.6 Credit Decision.  Each Lender  acknowledges  that none of the Agent-Related
Persons  has made any  representation  or warranty to it, and that no act by the
Agent  hereinafter  taken,  including any review of the affairs of the Borrowers
and their  Affiliates,  shall be  deemed to  constitute  any  representation  or
warranty by any  Agent-Related  Person to any Lender.  Each Lender represents to
the Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made  its own  appraisal  of and  investigation  into the  business,  prospects,
operations,  property, financial and other condition and creditworthiness of the
Borrowers and their Affiliates, and all applicable bank regulatory laws relating
to the transactions contemplated hereby, and made its own decision to enter into
this  Agreement  and  to  extend  credit  to the  Borrowers.  Each  Lender  also
represents  that  it  will,   independently   and  without   reliance  upon  any
Agent-Related  Person and based on such  documents and  information  as it shall
deem  appropriate  at the  time,  continue  to  make  its own  credit  analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents,  and to make such investigations as it deems necessary
to inform itself as to the business, prospects,  operations, property, financial
and other  condition  and  creditworthiness  of  Borrowers.  Except for notices,
reports and other  documents  expressly  herein  required to be furnished to the
Lenders by the Agent,  the Agent  shall not have any duty or  responsibility  to
provide any Lender with any credit or other information concerning the business,
prospects,    operations,   property,   financial   and   other   condition   or
creditworthiness  of any Borrower  which may come into the  possession of any of
the Agent-Related Persons.

12.7  Indemnification.  Whether or not the transactions  contemplated hereby are
consummated,  the Lenders shall indemnify upon demand the Agent-Related  Persons
(to the extent  not  reimbursed  by or on behalf of the  Borrowers  and  without
limiting the  obligation of the Borrowers to do so), in accordance  with its Pro
Rata Share, from and against any and all Indemnified Liabilities as such term is
defined in Section 13.11; provided,  however, that no Lender shall be liable for
the  payment to the  Agent-Related  Persons of any  portion of such  Indemnified
Liabilities  resulting  solely from such  Person's  gross  negligence or willful
misconduct. Without limitation of the foregoing, each Lender shall reimburse the
Agent upon demand for its Pro Rata Share of any costs or out-of-pocket  expenses
(including  Attorney  Costs)  incurred  by the  Agent  in  connection  with  the
preparation,  execution, delivery,  administration,  modification,  amendment or
enforcement (whether through  negotiations,  legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities  under, this Agreement,
any other Loan Document,  or any document contemplated by or referred to herein,
to the extent that the Agent is not reimbursed for such expenses by or on behalf
of the Borrowers.  The  undertaking in this Section shall survive the payment of
all Obligations hereunder and the resignation or replacement of the Agent.

12.8 Agent in Individual  Capacity.  The Bank and its  Affiliates may make loans
to, issue letters of credit for the account of, accept  deposits  from,  acquire
equity  interests  in and  generally  engage  in any  kind  of  banking,  trust,
financial  advisory,  underwriting  or other  business with any Borrower and its
Affiliates as though the Bank were not the Agent hereunder and without notice to
or consent of the Lenders.  The Bank or its Affiliates  may receive  information
regarding  any  Borrower,   its  Affiliates  and  Account   Debtors   (including
information that may be subject to confidentiality  obligations in favor of such
Borrower or such  Affiliates) and acknowledge  that the Agent and the Bank shall
be under no obligation to provide such  information to them. With respect to its
Loans,  the Bank shall have the same rights and powers  under this  Agreement as
any other Lender and may exercise the same as though it were not the Agent,  and
the terms "Lender" and "Lenders" include the Bank in its individual capacity.

12.9 Successor Agent. The Agent may resign as Agent upon at least 30 days' prior
notice to the Lenders and the Borrower  Representative,  such  resignation to be
effective upon the acceptance of a successor  agent to its appointment as Agent.
In the event the Bank sells all of its Commitment and Revolving Loans as part of
a sale,  transfer or other  disposition by the Bank of substantially  all of its
loan portfolio,  the Bank shall resign as Agent and such purchaser or transferee
shall become the successor  Agent  hereunder.  Subject to the foregoing,  if the
Agent  resigns  under this  Agreement,  the Required  Lenders shall appoint from
among the Lenders a successor agent for the Lenders, which successor agent shall
be reasonably satisfactory to the Borrower Representative so long as no Event of
Default  shall  have  occurred  and be  continuing.  If no  successor  agent  is
appointed prior to the effective date of the resignation of the Agent, the Agent
may appoint, after consulting with the Lenders and the Borrower  Representative,
a  successor  agent from  among the  Lenders,  which  successor  agent  shall be
reasonably  satisfactory to the Borrower  Representative  so long as no Event of
Default  shall have  occurred and be  continuing;  provided that if no successor
agent  shall have been  appointed  within the 30 Business  Day period  following
delivery of the Agent's notice of  resignation,  such  resignation  shall become
effective and the Required Lenders shall thereafter perform all of the duties of
the Agent until such time, if any , as the Required  Lenders appoint a successor
agent as provided  above.  Upon the  acceptance of its  appointment as successor
agent  hereunder,  such successor agent shall succeed to all the rights,  powers
and duties of the retiring  Agent and the term "Agent" shall mean such successor
agent and the retiring Agent's appointment,  powers and duties as Agent shall be
terminated.  After any retiring  Agent's  resignation  hereunder  as Agent,  the
provisions  of this Article 12 shall  continue to inure to its benefit as to any
actions  taken or  omitted  to be taken by it  while  it was  Agent  under  this
Agreement.

12.10    Withholding Tax.
         ---------------

(a) If any Lender is a "foreign  corporation,  partnership  or trust" within the
meaning of the Code and such Lender may claim exemption from, or a reduction of,
U.S. withholding tax under Sections 1441 or 1442 of the Code, such Lender agrees
with and in favor of the Agent, to deliver to the Agent:

(i) if such Lender may claim an exemption  from, or a reduction of,  withholding
tax under a United  States of America tax treaty,  properly  completed IRS Forms
W-8BEN and W-8ECI before the payment of any interest in the first  calendar year
and before the payment of any interest in each third  succeeding  calendar  year
during which interest may be paid under this Agreement;

(ii) if such Lender may claim that interest paid under this  Agreement is exempt
from  United  States  of  America  withholding  tax  because  it is  effectively
connected with a United States of America trade or business of such Lender,  two
properly  completed and executed copies of IRS Form W-8ECI before the payment of
any  interest  is due in the  first  taxable  year  of such  Lender  and in each
succeeding  taxable year of such Lender during which  interest may be paid under
this Agreement, and IRS Form W-9; and

(iii) such other form or forms as may be  required  under the Code or other laws
of the United  States of America as a condition to exemption  from, or reduction
of, United States of America withholding tax. If such Lender claims an exemption
from  withholding  tax  pursuant  to  its  portfolio  interest  exception  (a) a
statement  of the Lender that it is not a (i) a "bank" as  described  in Section
881(c)(3)(A) of the Code, (ii) a 10% shareholder  (within the meaning of Section
881(c)(3)(B) of the Code) or (iii) a controlled foreign corporation described in
Section 881(c)(3)(C) of the Code and (b) a properly completed Form W-8BEN.

Such Lender agrees to promptly  notify the Agent of any change in  circumstances
which would modify or render invalid any claimed exemption or reduction.

(b) If any Lender claims exemption from, or reduction of,  withholding tax under
a United  States of America  tax treaty by  providing  IRS Form  W-8BEN and such
Lender sells, assigns,  grants a participation in, or otherwise transfers all or
part of the Obligations  owing to such Lender,  such Lender agrees to notify the
Agent of the percentage  amount in which it is no longer the beneficial owner of
Obligations  of the Borrowers to such Lender.  To the extent of such  percentage
amount, the Agent will treat such Lender's IRS Form W-8BEN as no longer valid.

(c) If any Lender claiming  exemption from United States of America  withholding
tax by  filing  IRS  Form  W-8ECI  with  the  Agent  sells,  assigns,  grants  a
participation in, or otherwise transfers all or part of the Obligations owing to
such Lender,  such Lender agrees to undertake sole  responsibility for complying
with the withholding tax  requirements  imposed by Sections 1441 and 1442 of the
Code.

(d) If any Lender is entitled to a reduction in the applicable  withholding tax,
the Agent  shall  withhold  from any  interest  payment to such Lender an amount
equivalent  to the  applicable  withholding  tax after  taking into account such
reduction.  If the forms or other  documentation  required by subsection  (a) of
this Section are not  delivered to the Agent,  then the Agent may withhold  from
any  interest  payment  to  such  Lender  not  providing  such  forms  or  other
documentation an amount equivalent to the applicable withholding tax.

(e) If the IRS or any  other  Governmental  Authority  of the  United  States of
America or other  jurisdiction  asserts a claim that the Agent did not  properly
withhold tax from amounts paid to or for the account of any Lender  (because the
appropriate form was not delivered,  was not properly executed,  or because such
Lender failed to notify the Agent of a change in  circumstances  which  rendered
the exemption  from, or reduction of,  withholding tax  ineffective,  or for any
other reason) such Lender shall  indemnify the Agent fully for all amounts paid,
directly or indirectly,  by the Agent as tax or otherwise,  including  penalties
and interest, and including any taxes imposed by any jurisdiction on the amounts
payable to the Agent under this  Section,  together  with all costs and expenses
(including  Attorney Costs). The obligation of the Lenders under this subsection
shall survive the payment of all  Obligations and the resignation or replacement
of the Agent.

(f) Each Person that shall become an Assignee or  Participant of a Lender shall,
upon the  effectiveness of the related  transfer,  be required to provide all of
the forms and statements  required  pursuant to this Section 12.10 to the extent
applicable to such Assignee or Participant.

12.11    [Intentionally Omitted.]
          ---------------------

12.12    Restrictions on Actions by Lenders; Sharing of Payments.
         -------------------------------------------------------

(a) Each of the Lenders agrees that it shall not, without the express consent of
all Lenders,  and that it shall, to the extent it is lawfully entitled to do so,
upon the request of all Lenders,  set off against the  Obligations,  any amounts
owing by such Lender to any  Borrower or any  accounts  of any  Borrower  now or
hereafter  maintained with such Lender.  Each of the Lenders further agrees that
it shall not, unless specifically requested to do so by the Agent, take or cause
to be taken any action to enforce its rights under this Agreement or against any
Borrower.

(b)  If at  any  time  or  times  any  Lender  shall  receive  (i)  by  payment,
foreclosure,  setoff or otherwise,  any payments with respect to the Obligations
of any Borrower to such Lender arising under,  or relating to, this Agreement or
the other Loan Documents,  except for any such payments  received by such Lender
from the Agent  pursuant to the terms of this  Agreement,  or (ii) payments from
the Agent in excess of such Lender's Pro Rata Share of all such distributions by
the Agent,  such Lender shall  promptly (1) turn the same over to the Agent,  in
kind, and with such endorsements as may be required to negotiate the same to the
Agent,  or in same day  funds,  as  applicable,  for the  account  of all of the
Lenders and for application to the Obligations in accordance with the applicable
provisions of this Agreement, or (2) purchase,  without recourse or warranty, an
undivided  interest  and  participation  in the  Obligations  owed to the  other
Lenders so that such excess payment  received shall be applied  ratably as among
the Lenders in accordance with their Pro Rata Shares; provided, however, that if
all or  part  of  such  excess  payment  received  by the  purchasing  party  is
thereafter  recovered  from  it,  those  purchases  of  participations  shall be
rescinded in whole or in part, as applicable,  and the applicable portion of the
purchase price paid therefor  shall be returned to such  purchasing  party,  but
without  interest except to the extent that such purchasing party is required to
pay interest in connection with the recovery of the excess payment.

12.13    [Intentionally Omitted]
          ---------------------

12.14 Payments by Agent to Lenders.  All payments to be made by the Agent to the
Lenders shall be made by bank wire transfer or internal  transfer of immediately
available funds to each Lender pursuant to wire transfer instructions  delivered
in writing to the Agent on or prior to the Closing Date (or if such Lender is an
Assignee,  on the  applicable  Assignment and  Acceptance),  or pursuant to such
other  wire  transfer  instructions  as each party may  designate  for itself by
written  notice to the Agent.  Concurrently  with each such  payment,  the Agent
shall  identify  whether  such  payment  (or  any  portion  thereof)  represents
principal,  premium or interest on the Revolving  Loans or other amounts payable
hereunder.  Unless the Agent  receives  notice from the Borrower  Representative
prior to the date on which any payment is due to the Lenders that the  Borrowers
will not make such  payment in full as and when  required,  the Agent may assume
that the  Borrowers  have made such payment in full to the Agent on such date in
immediately available funds and the Agent may (but shall not be so required), in
reliance  upon such  assumption,  distribute  to each Lender on such due date an
amount  equal to the  amount  then due such  Lender.  If and to the  extent  the
Borrowers  have not made such  payment in full to the Agent,  each Lender  shall
repay to the Agent on demand such amount  distributed  to such Lender,  together
with interest  thereon at the Federal Funds Rate for each day from the date such
amount is distributed to such Lender until the date repaid.

12.15    Settlement.
         ----------

(a) (i) Each Lender's  funded portion of the Revolving  Loans is intended by the
Lenders  to be  equal  at all  times  to such  Lender's  Pro  Rata  Share of the
outstanding  Revolving  Loans.  Notwithstanding  such agreement,  the Agent, the
Bank, and the other Lenders agree (which  agreement shall not be for the benefit
of  or   enforceable   by  any  Borrower)   that  in  order  to  facilitate  the
administration of this Agreement and the other Loan Documents,  settlement among
them as to the  Revolving  Loans,  the  Non-Ratable  Loans shall take place on a
periodic basis in accordance with the following provisions:

     (ii) The Agent shall request settlement  ("Settlement") with the Lenders on
at least a weekly basis, or on a more frequent basis at Agent's election, (A) on
behalf of the Bank, with respect to each outstanding  Non-Ratable  Loan, and (B)
with respect to collections  received, in each case, by notifying the Lenders of
such  requested  Settlement  by  telecopy,  telephone  or other  similar form of
transmission,  of such requested Settlement,  no later than 12:00 noon (Chicago,
Illinois time) on the date of such requested Settlement (the "Settlement Date").
Each  Lender  (other  than the Bank,  in the case of  Non-Ratable  Loans)  shall
transfer the amount of such Lender's Pro Rata Share of the outstanding principal
amount of the Non-Ratable Loans with respect to each Settlement to the Agent, to
Agent's  account,  not later than 2:00 p.m.  (Chicago,  Illinois  time),  on the
Settlement   Date   applicable   thereto.   Settlements  may  occur  during  the
continuation  of a  Default  or an  Event  of  Default  and  whether  or not the
applicable conditions precedent set forth in Article 8 have then been satisfied.
Such amounts made available to the Agent shall be applied against the amounts of
the  applicable  Non-Ratable  Loan  and,  together  with  the  portion  of  such
Non-Ratable  Loan  representing  the  Bank's  Pro  Rata  Share  thereof,   shall
constitute  Revolving  Loans  of  such  Lenders.  If  any  such  amount  is  not
transferred  to the  Agent  by any  Lender  on the  Settlement  Date  applicable
thereto,  the Agent shall be entitled to recover such amount on demand from such
Lender  together with  interest  thereon at the Federal Funds Rate for the first
three (3) days from and after the Settlement Date and thereafter at the Interest
Rate then  applicable to the Revolving Loans on behalf of the Bank, with respect
to each outstanding Non-Ratable Loan.

     (iii)  Notwithstanding  the  foregoing,  not more than one (1) Business Day
after demand is made by the Agent  (whether  before or after the occurrence of a
Default or an Event of Default and regardless of whether the Agent has requested
a Settlement  with respect to a Non-Ratable  Loan),  each other Lender (A) shall
irrevocably and unconditionally purchase and receive from the Bank or the Agent,
as  applicable,   without  recourse  or  warranty,  an  undivided  interest  and
participation  in such Non-Ratable Loan equal to such Lender's Pro Rata Share of
such  Non-Ratable  Loan and (B) if Settlement has not  previously  occurred with
respect to such Non-Ratable  Loans, upon demand by Bank or Agent, as applicable,
shall  pay to Bank or  Agent,  as  applicable,  as the  purchase  price  of such
participation an amount equal to one hundred percent (100%) of such Lender's Pro
Rata  Share  of such  Non-Ratable  Loans.  If such  amount  is not in fact  made
available  to the Agent by any  Lender,  the Agent  shall be entitled to recover
such amount on demand from such Lender  together  with  interest  thereon at the
Federal  Funds Rate for the first  three (3) days from and after such demand and
thereafter at the Interest Rate then applicable to Base Rate Revolving Loans.

     (iv) From and after the date,  if any,  on which any  Lender  purchases  an
undivided  interest and participation in any Non-Ratable Loan pursuant to clause
(iii) above, the Agent shall promptly  distribute to such Lender,  such Lender's
Pro Rata Share of all payments of principal and interest and all other  proceeds
received by the Agent in respect of such Non-Ratable Loan.

     (v)  Between  Settlement  Dates,  the  Agent,  may pay over to the Bank any
payments  received  by the  Agent,  which in  accordance  with the terms of this
Agreement  would  be  applied  to the  reduction  of the  Revolving  Loans,  for
application to the Bank's Revolving Loans including Non-Ratable Loans. If, as of
any Settlement Date,  collections received since the then immediately  preceding
Settlement  Date have been applied to the Bank's  Revolving Loans (other than to
Non-Ratable  Loans in which such  Lender has not yet  funded its  purchase  of a
participation  pursuant to clause (iii) above),  as provided for in the previous
sentence, the Bank shall pay to the Agent for the accounts of the Lenders, to be
applied to the outstanding  Revolving Loans of such Lenders, an amount such that
each Lender  shall,  upon receipt of such amount,  have,  as of such  Settlement
Date,  its Pro Rata Share of the  Revolving  Loans.  During  the period  between
Settlement  Dates,  the Bank with respect to Non-Ratable  Loans, and each Lender
with  respect to the  Revolving  Loans other than  Non-Ratable  Loans,  shall be
entitled  to  interest  at the  applicable  rate or  rates  payable  under  this
Agreement on the actual  average daily amount of funds employed by the Bank, the
Agent and the other Lenders.

(b) Lenders'  Failure to Perform.  All Revolving  Loans (other than  Non-Ratable
Loans) shall be made by the Lenders  simultaneously and in accordance with their
Pro Rata Shares.  It is understood  that (i) no Lender shall be responsible  for
any failure by any other Lender to perform its  obligation to make any Revolving
Loans  hereunder,  nor shall  any  Commitment  of any  Lender  be  increased  or
decreased  as a result  of any  failure  by any  other  Lender  to  perform  its
obligation to make any Revolving Loans hereunder,  (ii) no failure by any Lender
to perform its obligation to make any Revolving Loans hereunder shall excuse any
other Lender from its  obligation to make any  Revolving  Loans  hereunder,  and
(iii) the obligations of each Lender  hereunder shall be several,  not joint and
several.

(c) Defaulting  Lenders.  Unless the Agent  receives  notice from a Lender on or
prior to the Closing  Date or, with respect to any  Borrowing  after the Closing
Date, at least one Business Day prior to the date of such  Borrowing,  that such
Lender will not make available as and when required  hereunder to the Agent that
Lender's  Pro Rata Share of a  Borrowing,  the Agent may assume that each Lender
has made such amount  available to the Agent in immediately  available  funds on
the Funding Date. Furthermore,  the Agent may, in reliance upon such assumption,
make  available to the  Borrowers on such date a  corresponding  amount.  If any
Lender has not  transferred  its full Pro Rata Share to the Agent in immediately
available  funds  and the  Agent  has  transferred  corresponding  amount to the
Borrowers,  on the  Business Day  following  such Funding Date that Lender shall
make such amount  available to the Agent,  together with interest at the Federal
Funds Rate for that day.  A notice by the Agent  submitted  to any  Lender  with
respect to amounts owing shall be conclusive,  absent  manifest  error.  If each
Lender's full Pro Rata Share is transferred to the Agent as required, the amount
transferred to the Agent shall  constitute that Lender's  Revolving Loan for all
purposes of this  Agreement.  If that amount is not  transferred to the Agent on
the Business Day following the Funding Date,  the Agent will notify the Borrower
Representative  of such  failure  to fund and,  upon  demand by the  Agent,  the
Borrowers shall pay such amount to the Agent for the Agent's  account,  together
with interest thereon for each day elapsed since the date of such Borrowing,  at
a rate  per  annum  equal to the  Interest  Rate  applicable  at the time to the
Revolving Loans comprising that particular Borrowing.  The failure of any Lender
to make any  Revolving  Loan on any Funding Date (any such Lender,  prior to the
cure of such failure,  being hereinafter  referred to as a "Defaulting  Lender")
shall  not  relieve  any  other  Lender of its  obligation  hereunder  to make a
Revolving  Loan on that Funding  Date.  No Lender shall be  responsible  for any
other  Lender's  failure to advance  such other  Lenders'  Pro Rata Share of any
Borrowing.

(d) Retention of Defaulting Lender's Payments.  The Agent shall not be obligated
to transfer to a  Defaulting  Lender any payments  made by the  Borrowers to the
Agent for the  Defaulting  Lender's  benefit;  nor shall a Defaulting  Lender be
entitled  to the  sharing  of  any  payments  hereunder.  Amounts  payable  to a
Defaulting  Lender  shall  instead be paid to or retained  by the Agent.  In its
discretion,  the Agent may loan the  Borrowers  the amount of all such  payments
received  or  retained  by it for the  account of such  Defaulting  Lender.  Any
amounts so loaned to the Borrowers shall bear interest at the rate applicable to
Base Rate Revolving  Loans and for all other purposes of this Agreement shall be
treated as if they were Revolving Loans, provided, however, that for purposes of
voting  or  consenting  to  matters  with  respect  to the  Loan  Documents  and
determining Pro Rata Shares,  such Defaulting Lender shall be deemed not to be a
"Lender". Until a Defaulting Lender cures its failure to fund its Pro Rata Share
of any Borrowing (A) such Defaulting Lender shall not be entitled to any portion
of the Unused Line Fee and (B) the Unused Line Fee shall  accrue in favor of the
Lenders  which have funded their  respective  Pro Rata Shares of such  requested
Borrowing and shall be allocated  among such  performing  Lenders  ratably based
upon their  relative  Commitments.  This  Section  shall remain  effective  with
respect to such Lender until such time as the Defaulting  Lender shall no longer
be in default of any of its obligations under this Agreement.  The terms of this
Section shall not be construed to increase or otherwise affect the Commitment of
any  Lender,  or relieve or excuse the  performance  by the  Borrowers  of their
duties and obligations hereunder.

(e) Removal of Defaulting Lender. At the Borrower  Representative's request, the
Agent  or an  Eligible  Assignee  reasonably  acceptable  to the  Agent  and the
Borrower  Representative  shall  have  the  right  (but not the  obligation)  to
purchase from any Defaulting Lender, and each Defaulting Lender shall, upon such
request,  sell and  assign to the Agent or such  Eligible  Assignee,  all of the
Defaulting  Lender's  outstanding  Commitments  hereunder.  Such  sale  shall be
consummated promptly after the Agent has arranged for a purchase by the Agent or
an Eligible  Assignee  pursuant to an Assignment and Acceptance,  and at a price
equal to the  outstanding  principal  balance of the Defaulting  Lender's Loans,
plus accrued and unpaid interest and fees, without premium or discount.

12.16    Letters of Credit; Intra-Lender Issues.
         --------------------------------------

(a)      Notice of Letter of Credit  Balance.  On each  Settlement  Date the
Agent shall  notify each Lender of the issuance of all Letters of Credit since
the prior Settlement Date.

(b)      Participations in Letters of Credit.
         -----------------------------------

(i)  Purchase  of  Participations.  Immediately  upon  issuance of any Letter of
Credit in accordance  with Section  1.4(d),  each Lender shall be deemed to have
irrevocably  and  unconditionally  purchased  and received  without  recourse or
warranty,  an undivided  interest and  participation  equal to such Lender's Pro
Rata Share of the face  amount of such  Letter of Credit or the  Credit  Support
provided  through the Agent to the Letter of Credit Issuer,  if not the Bank, in
connection with the issuance of such Letter of Credit (including all obligations
of the Borrowers  with respect  thereto,  and any security  therefor or guaranty
pertaining thereto).

(ii) Sharing of Reimbursement Obligation Payments. Whenever the Agent receives a
payment from the Borrowers on account of reimbursement obligations in respect of
a Letter  of  Credit or  Credit  Support  as to which  the Agent has  previously
received for the account of the Letter of Credit Issuer  thereof  payment from a
Lender, the Agent shall promptly pay to such Lender such Lender's Pro Rata Share
of such payment from the Borrowers. Each such payment shall be made by the Agent
on the next Settlement Date.

(iii) Documentation.  Upon the request of any Lender, the Agent shall furnish to
such  Lender  copies of any Letter of Credit,  Credit  Support for any Letter of
Credit, reimbursement agreements executed in connection therewith,  applications
for any Letter of Credit,  and such other  documentation  as may  reasonably  be
requested by such Lender.

(iv) Obligations Irrevocable. The obligations of each Lender to make payments to
the  Agent  with  respect  to any  Letter of  Credit  or with  respect  to their
participation  therein or with  respect to any Credit  Support for any Letter of
Credit or with  respect  to the  Revolving  Loans  made as a result of a drawing
under a Letter of Credit and the joint and several  obligations of the Borrowers
to make  payments  to the  Agent,  for the  account  of the  Lenders,  shall  be
irrevocable  and  shall  not  be  subject  to  any  qualification  or  exception
whatsoever , including any of the following circumstances:

(1)      any lack of validity or enforceability of this Agreement or any of the
         other Loan Documents;

(2)      the  existence of any claim,  setoff,  defense or other right which any
         Borrower may have at any time against a  beneficiary  named in a Letter
         of Credit or any  transferee of any Letter of Credit (or any Person for
         whom any such  transferee may be acting),  any Lender,  the Agent,  the
         issuer  of such  Letter of  Credit,  or any other  Person,  whether  in
         connection with this Agreement,  any Letter of Credit, the transactions
         contemplated  herein  or  any  unrelated  transactions  (including  any
         underlying  transactions  between any  Borrower or any other Person and
         the beneficiary named in any Letter of Credit);

(3)      any draft, certificate or any other document presented under the Letter
         of Credit proving to be forged, fraudulent,  invalid or insufficient in
         any respect or any statement  therein being untrue or inaccurate in any
         respect;

(4)      the occurrence of any Default or Event of Default; or

(5)      the failure of the Borrowers to satisfy the applicable conditions
precedent set forth in Article 8.


(c) Recovery or Avoidance of Payments; Refund of Payments In Error. In the event
any payment by or on behalf of any  Borrower  received by the Agent with respect
to any Letter of Credit or Credit Support  provided for any Letter of Credit and
distributed  by  the  Agent  to the  Lenders  on  account  of  their  respective
participations  therein is thereafter  set aside,  avoided or recovered from the
Agent in connection with any receivership, liquidation or bankruptcy proceeding,
the Lenders shall,  upon demand by the Agent,  pay to the Agent their respective
Pro Rata Shares of such amount set aside,  avoided or  recovered,  together with
interest at the rate  required to be paid by the Agent upon the amount  required
to be  repaid  by it.  Unless  the  Agent  receives  notice  from  the  Borrower
Representative prior to the date on which any payment is due to the Lenders that
the Borrowers will not make such payment in full as and when required, the Agent
may assume  that the  Borrowers  have made such  payment in full to the Agent on
such date in immediately  available funds and the Agent may (but shall not be so
required),  in reliance upon such assumption,  distribute to each Lender on such
due date an  amount  equal to the  amount  then due such  Lender.  If and to the
extent the  Borrowers  have not made such  payment  in full to the  Agent,  each
Lender  shall  repay to the  Agent on demand  such  amount  distributed  to such
Lender,  together with  interest  thereon at the Federal Funds Rate for each day
from the date such amount is distributed to such Lender until the date repaid.

12.17 Concerning the Related Loan Documents.  Each Lender authorizes and directs
the Agent to enter into the other Loan  Documents,  for the ratable  benefit and
obligation  of the Agent and the  Lenders.  Each  Lender  agrees that any action
taken by the Agent,  Majority  Lenders or Required  Lenders,  as applicable,  in
accordance with the terms of this Agreement or the other Loan Documents, and the
exercise  by the Agent,  the  Majority  Lenders,  or the  Required  Lenders,  as
applicable,  of their  respective  powers set forth therein or herein,  together
with such other powers that are reasonably incidental thereto,  shall be binding
upon all of the Lenders.

12.18    Field Audit and Examination Reports; Disclaimer by Lenders.  By signing
this Agreement, each Lender:


(a) is deemed to have  requested  that the Agent  furnish such Lender,  promptly
after it becomes  available,  a copy of each field audit or  examination  report
(each a "Report" and collectively, "Reports") prepared by the Agent;

(b) expressly  agrees and  acknowledges  that neither the Bank nor the Agent (i)
makes any  representation  or warranty as to the accuracy of any Report, or (ii)
shall be liable for any information contained in any Report;

(c) expressly  agrees and  acknowledges  that the Reports are not  comprehensive
audits or examinations, that the Agent or the Bank or other party performing any
audit or  examination  will  inspect only  specific  information  regarding  the
Borrowers and will rely significantly upon the Borrowers' books and records,  as
well as on representations of the Borrower's personnel;

(d)      agrees to keep all Reports  confidential and strictly for its internal
use, and not to distribute  except, subject to Section 13.17(b), to its
participants, or use any Report in any other manner; and


(e) without  limiting  the  generality  of any other  indemnification  provision
contained in this  Agreement,  agrees:  (i) to hold the Agent and any such other
Lender preparing a Report harmless from any action the  indemnifying  Lender may
take or conclusion the indemnifying  Lender may reach or draw from any Report in
connection with any loans or other credit  accommodations  that the indemnifying
Lender  has  made or may make to the  Borrowers,  or the  indemnifying  Lender's
participation  in, or the indemnifying  Lender's purchase of, a loan or loans of
the Borrowers;  and (ii) to pay and protect, and indemnify,  defend and hold the
Agent and any such other Lender  preparing a Report  harmless  from and against,
the claims,  actions,  proceedings,  damages,  costs, expenses and other amounts
(including  Attorney  Costs)  incurred  by the Agent and any such  other  Lender
preparing  a Report as the direct or  indirect  result of any third  parties who
might obtain all or part of any Report through the indemnifying Lender.

12.19 Relation Among Lenders. The Lenders are not partners or co-venturers,  and
no Lender shall be liable for the acts or omissions  of, or (except as otherwise
set forth herein in case of the Agent) authorized to act for, any other Lender.

ARTICLE 13
                                  MISCELLANEOUS

13.1 No Waivers;  Cumulative Remedies.  No failure by the Agent or any Lender to
exercise any right,  remedy,  or option  under this  Agreement or any present or
future  supplement  thereto,  or in any  other  agreement  between  or among the
Borrowers  and the Agent and/or any Lender,  or delay by the Agent or any Lender
in exercising the same, will operate as a waiver thereof. No waiver by the Agent
or the Lenders on any  occasion  shall  affect or diminish  the Agent's and each
Lender's rights thereafter to require strict performance by the Borrowers of any
provision of this  Agreement.  The Agent's and each  Lender's  rights under this
Agreement  will be  cumulative  and not  exclusive  of any other right or remedy
which the Agent or any Lender may have.

13.2 Severability.  The illegality or  unenforceability of any provision of this
Agreement or any Loan Document or any instrument or agreement required hereunder
shall not in any way  affect or impair the  legality  or  enforceability  of the
remaining  provisions of this Agreement or any instrument or agreement  required
hereunder.

13.3     Governing Law; Choice of Forum; Service of Process.
         --------------------------------------------------

(a) IN THE EVENT OF A CONFLICT BETWEEN THE TERMS OF THIS AGREEMENT AND THE FINAL
ORDER,  THE FINAL ORDER SHALL CONTROL.  THIS AGREEMENT  SHALL BE INTERPRETED AND
THE RIGHTS AND  LIABILITIES OF THE PARTIES HERETO  DETERMINED IN ACCORDANCE WITH
THE INTERNAL LAWS (AS OPPOSED TO THE CONFLICT OF LAWS  PROVISIONS)  OF THE STATE
OF  ILLINOIS;  PROVIDED  THAT THE AGENT AND THE LENDERS  SHALL RETAIN ALL RIGHTS
ARISING UNDER FEDERAL LAW.

(b) ANY LEGAL ACTION OR PROCEEDING  WITH RESPECT TO THIS  AGREEMENT OR ANY OTHER
LOAN  DOCUMENT  MAY BE BROUGHT IN THE  BANKRUPTCY  COURT OR IN THE COURTS OF THE
STATE OF ILLINOIS  OR OF THE UNITED  STATES OF AMERICA  LOCATED IN COOK  COUNTY,
ILLINOIS,  AND  BY  EXECUTION  AND  DELIVERY  OF  THIS  AGREEMENT,  EACH  OF THE
BORROWERS,  THE AGENT AND THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY,  TO THE  NON-EXCLUSIVE  JURISDICTION  OF  THOSE  COURTS.  EACH  OF THE
BORROWERS, THE AGENT AND THE LENDERS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING
ANY  OBJECTION  TO THE  LAYING  OF VENUE OR BASED ON THE  GROUNDS  OF FORUM  NON
CONVENIENS,  WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING  IN SUCH  JURISDICTION  IN RESPECT OF THIS  AGREEMENT OR ANY DOCUMENT
RELATED  HERETO.  NOTWITHSTANDING  THE FOREGOING:  (1) THE AGENT AND THE LENDERS
SHALL HAVE THE RIGHT TO BRING ANY ACTION OR  PROCEEDING  AGAINST ANY BORROWER OR
ITS  PROPERTY IN THE COURTS OF ANY OTHER  COMPETENT  JURISDICTION  NECESSARY  OR
APPROPRIATE  IN ORDER TO EXERCISE  ANY RIGHTS OR  REMEDIES,  AND (2) EACH OF THE
PARTIES HERETO  ACKNOWLEDGES  THAT ANY APPEALS FROM THE COURTS  DESCRIBED IN THE
IMMEDIATELY  PRECEDING  SENTENCE MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE
THOSE JURISDICTIONS.

(c) EACH BORROWER HEREBY WAIVES PERSONAL  SERVICE OF ANY AND ALL PROCESS UPON IT
AND  CONSENTS  THAT ALL SUCH  SERVICE OF PROCESS MAY BE MADE BY  FACSIMILE OR BY
REGISTERED   MAIL   (RETURN   RECEIPT   REQUESTED)   DIRECTED  TO  THE  BORROWER
REPRESENTATIVE  AT ITS  ADDRESS  SET FORTH IN SECTION  13.8 AND  SERVICE SO MADE
SHALL BE DEEMED TO BE  COMPLETED  UPON THE  EARLIER  OF RECEIPT OR FIVE (5) DAYS
AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED IN THE U.S.  MAILS POSTAGE  PREPAID.
NOTHING  CONTAINED  HEREIN SHALL AFFECT THE RIGHT OF THE AGENT OR THE LENDERS TO
SERVE LEGAL PROCESS BY ANY OTHER MANNER PERMITTED BY LAW.

13.4  WAIVER OF JURY  TRIAL.  THE  BORROWERS,  THE  LENDERS  AND THE AGENT  EACH
IRREVOCABLY  WAIVE  THEIR  RESPECTIVE  RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS  AGREEMENT,  THE
OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY
ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES
AGAINST ANY OTHER PARTY OR ANY  AGENT-RELATED  PERSON,  PARTICIPANT OR ASSIGNEE,
WHETHER  WITH  RESPECT TO  CONTRACT  CLAIMS,  TORT  CLAIMS,  OR  OTHERWISE.  THE
BORROWERS,  THE LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF
ACTION  SHALL BE TRIED BY A COURT TRIAL  WITHOUT A JURY.  WITHOUT  LIMITING  THE
FOREGOING,  THE PARTIES FURTHER AGREE THAT THEIR  RESPECTIVE RIGHT TO A TRIAL BY
JURY IS WAIVED BY OPERATION OF THIS  SECTION AS TO ANY ACTION,  COUNTERCLAIM  OR
OTHER  PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR
ENFORCEABILITY  OF THIS  AGREEMENT OR THE OTHER LOAN  DOCUMENTS OR ANY PROVISION
HEREOF  OR  THEREOF.  THIS  WAIVER  SHALL  APPLY TO ANY  SUBSEQUENT  AMENDMENTS,
RENEWALS,  SUPPLEMENTS  OR  MODIFICATIONS  TO THIS  AGREEMENT AND THE OTHER LOAN
DOCUMENTS.

13.5  Survival  of  Representations  and  Warranties.   All  of  the  Borrowers'
representations  and warranties  contained in this  Agreement  shall survive the
execution, delivery, and acceptance thereof by the parties,  notwithstanding any
investigation by the Agent or the Lenders or their respective agents.

13.6     [Intentionally Omitted.]
          ---------------------

13.7 Fees and Expenses.  The Borrowers,  jointly and severally,  agree to pay to
the Agent, for its benefit,  on demand,  all reasonable costs and  out-of-pocket
expenses  that  Agent  pays  or  incurs  in  connection  with  the  negotiation,
preparation,  syndication,   consummation,   administration,   enforcement,  and
termination of this Agreement or any of the other Loan Documents, including: (a)
Attorney  Costs;  (b)  reasonable  costs  and  expenses  (including   reasonable
attorneys'  and  paralegals'   fees  and   disbursements)   for  any  amendment,
supplement,  waiver,  consent, or subsequent closing in connection with the Loan
Documents and the transactions  contemplated  thereby;  (c) reasonable costs and
expenses of lien and title searches; (d) sums paid or incurred to pay any amount
or take any action  required of the Borrowers  under the Loan Documents that any
Borrower  fails  to pay or  take;  (e)  reasonable  costs  of  inspections,  and
verifications  of  the  Borrowers'  properties  and  assets,  including  travel,
lodging,  and meals for inspections of the Borrowers'  properties and assets and
the Borrowers'  operations by the Agent plus the Agent's then  customary  charge
for field  examinations  and audits and the preparation of reports thereof (such
charge is currently $750 per day (or portion thereof) for each agent or employee
of the Agent with respect to each field  examination  or audit);  (f) reasonable
costs and  out-of-pocket  expenses of forwarding  loan  proceeds and  collecting
checks  and other  items of  payment;  and (g)  reasonable  costs  and  expenses
(including  Attorneys'  Costs)  paid  or  incurred  to  obtain  payment  of  the
Obligations and otherwise  enforce the provisions of the Loan  Documents,  or to
defend any claims made or threatened against the Agent or any Lender arising out
of  the  transactions   contemplated  hereby  (including  preparations  for  and
consultations concerning any such matters). The foregoing shall not be construed
to limit any other provisions of the Loan Documents regarding costs and expenses
to be paid by the  Borrowers.  All of the foregoing  costs and expenses shall be
payable on the third  Business Day  following  notification  by the Agent to the
Borrower of the amount thereof and may be charged to the Borrowers' Loan Account
as  Revolving  Loans as  described in Section 3.7 if not paid on or before 12:00
noon (Chicago, Illinois time) on such date.

13.8 Notices.  Except as otherwise  provided  herein,  all notices,  demands and
requests  that any party is  required or elects to give to any other shall be in
writing, or by a telecommunications device capable of creating a written record,
and any such notice shall become effective (a) upon personal  delivery  thereof,
including,  but not limited to, delivery by overnight mail and courier  service,
(b) four (4) days after it shall have been mailed by United  States mail,  first
class,  certified or  registered,  with postage  prepaid,  or (c) in the case of
notice by such a telecommunications  device, when properly transmitted,  in each
case addressed to the party to be notified as follows:

                  If to the Agent or to the Bank:

                                    Bank of America, N.A.
                                    231 South LaSalle Street
                                    Chicago, Illinois 60697
                                    Attention: Business Credit-Account Executive
                                    Telecopy No.:  (312) 974-8760

                                    with copies to:

                                    Latham & Watkins
                                    233 South Wacker Drive
                                    5800 Sears Tower
                                    Chicago, Illinois 60606
                                    Attention:  David S. Heller
                                                         and
                                                  James W. Doran
                                    Telecopy No.:  (312) 993-9767

                  If to any Borrower, to the Borrower Representative:

                                    Owens Corning
                                    Owens Corning World Headquarters
                                    One Owens Corning Parkway
                                    Toledo, Ohio 43659
                                    Attention:  Treasurer
                                    Telecopy No.:  (419) 248-1720

or to such other  address as each party may designate for itself by like notice.
Failure or delay in delivering copies of any notice, demand,  request,  consent,
approval,  declaration or other communication to the persons designated above to
receive  copies shall not  adversely  affect the  effectiveness  of such notice,
demand, request, consent, approval, declaration or other communication.

13.9  Waiver  of  Notices.  Unless  otherwise  expressly  provided  herein,  the
Borrowers waive presentment,  and notice of demand or dishonor and protest as to
any  instrument,  notice of intent to accelerate the  Obligations  and notice of
acceleration of the  Obligations,  as well as any and all other notices to which
any  Borrower  might  otherwise  be  entitled.  No  notice  to or  demand on the
Borrowers  which the Agent or any  Lender may elect to give  shall  entitle  the
Borrowers  to any or  further  notice or demand  in the same,  similar  or other
circumstances.

13.10 Binding Effect. The provisions of this Agreement shall be binding upon and
inure to the benefit of the respective representatives,  successors, and assigns
of the  parties  hereto;  provided,  however,  that no  interest  herein  may be
assigned by any Borrower  without  prior  written  consent of the Agent and each
Lender. The rights and benefits of the Agent and the Lenders hereunder shall, if
such  Persons  so  agree,  inure to any  party  acquiring  any  interest  in the
Obligations or any part thereof in accordance with the terms of Section 11.2.

13.11    Indemnity of the Agent and the Lenders by the Borrowers.
         -------------------------------------------------------

(a) The Borrowers,  jointly and severally,  agree to defend,  indemnify and hold
the Agent-Related  Persons, and each Lender and each of its respective officers,
directors,   employees,   counsel,   agents  and  attorneys-in-fact   (each,  an
"Indemnified  Person")  harmless  from  and  against  any and  all  liabilities,
obligations,  losses,  damages,  penalties,  actions,  judgments,  suits, costs,
charges,  expenses and disbursements  (including  Attorney Costs) of any kind or
nature  whatsoever  which  may at any  time  (including  at any  time  following
repayment of the Loans and the  termination,  resignation  or replacement of the
Agent or replacement of any Lender) be imposed on or incurred by any such Person
in any  way  relating  to or  arising  out of  this  Agreement  or any  document
contemplated by or referred to herein, or the transactions  contemplated hereby,
or any action  taken or omitted by any such Person under or in  connection  with
any of the foregoing, including with respect to any investigation, litigation or
proceeding (including any insolvency proceeding or appellate proceeding) related
to or arising out of this  Agreement,  any other Loan Document,  or the Loans or
the use of the  proceeds  thereof,  whether or not any  Indemnified  Person is a
party thereto (all the foregoing,  collectively, the "Indemnified Liabilities");
provided,   that  no  Borrower  shall  have  any  obligation  hereunder  to  any
Indemnified Person with respect to Indemnified Liabilities resulting solely from
the gross  negligence or willful  misconduct  of such  Indemnified  Person.  The
agreements in this Section shall survive payment of all other Obligations.

(b) The Borrowers,  jointly and severally,  agree to indemnify,  defend and hold
harmless the Agent and the Lenders  from any loss or  liability  imposed upon or
incurred  by any such  Person  directly  or  indirectly  arising out of the use,
generation,  manufacture,  production,  storage,  release,  threatened  release,
discharge,  disposal  or  presence  of a  hazardous  substance  relating  to any
Borrower's operations,  business or property.  This indemnity will apply whether
the  hazardous  substance  is on,  under or about  any  Borrower's  property  or
operations or property leased to any Borrower. The indemnity includes but is not
limited to Attorneys Costs. The indemnity  extends to the Agent and the Lenders,
their parents,  affiliates,  Subsidiaries and all of their directors,  officers,
employees,  agents,  successors,  attorneys and assigns.  "Hazardous substances"
means  any  substance,  material  or  waste  that is or  becomes  designated  or
regulated as "toxic,"  "hazardous,"  "pollutant," or  "contaminant" or a similar
designation or regulation  under any federal,  state or local law (whether under
common law,  statute,  regulation or  otherwise)  or judicial or  administrative
interpretation of such,  including petroleum or natural gas. This indemnity will
survive repayment of all other Obligations.

13.12 Limitation of Liability.  NO CLAIM MAY BE MADE BY ANY BORROWER, ANY LENDER
OR OTHER PERSON AGAINST THE AGENT,  ANY LENDER,  OR THE  AFFILIATES,  DIRECTORS,
OFFICERS,  EMPLOYEES,  OR  AGENTS  OF ANY OF  THEM  FOR ANY  SPECIAL,  INDIRECT,
CONSEQUENTIAL OR PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT
OR ANY OTHER THEORY OF LIABILITY  ARISING OUT OF OR RELATED TO THE  TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT,  OR ANY ACT, OMISSION
OR EVENT  OCCURRING IN  CONNECTION  THEREWITH,  AND ANY BORROWER AND EACH LENDER
HEREBY  WAIVE,  RELEASE  AND AGREE  NOT TO SUE UPON ANY CLAIM FOR SUCH  DAMAGES,
WHETHER OR NOT  ACCRUED AND  WHETHER OR NOT KNOWN OR  SUSPECTED  TO EXIST IN ITS
FAVOR.

13.13 Final Agreement.  This Agreement and the other Loan Documents are intended
by the  Borrowers,  the Agent and the  Lenders  to be the final,  complete,  and
exclusive  expression of the agreement  between them. This Agreement  supersedes
any and all prior oral or written  agreements  relating  to the  subject  matter
hereof.

13.14   Counterparts.   This   Agreement  may  be  executed  in  any  number  of
counterparts,  and by the Agent,  each  Lender  and each  Borrower  in  separate
counterparts,  each of  which  shall  be an  original,  but all of  which  shall
together constitute one and the same agreement;  signature pages may be detached
from multiple separate counterparts and attached to a single counterpart so that
all signature pages are physically attached to the same document.

13.15 Captions.  The captions contained in this Agreement are for convenience of
reference only, are without  substantive  meaning and should not be construed to
modify, enlarge, or restrict any provision.

13.16 Right of Setoff.  In  addition  to any rights and  remedies of the Lenders
provided  by  law,  if an  Event  of  Default  exists  or the  Loans  have  been
accelerated,  each  Lender  is  authorized  at any time  and from  time to time,
without  prior  notice to any  Borrower,  any such  notice  being  waived by the
Borrowers to the fullest  extent  permitted by law, to set off and apply any and
all deposits (general or special,  time or demand,  provisional or final) at any
time held by, and other indebtedness at any time owing by, such Lender to or for
the credit or the account of any Borrower against any and all Obligations  owing
to such Lender,  now or hereafter  existing,  irrespective of whether or not the
Agent or such Lender  shall have made demand  under this  Agreement  or any Loan
Document and although such  Obligations  may be  contingent  or unmatured.  Each
Lender agrees promptly to notify the Borrower Representative and the Agent after
any such set-off and application made by such Lender;  provided,  however,  that
the failure to give such notice  shall not affect the  validity of such  set-off
and  application.  NOTWITHSTANDING  THE FOREGOING,  NO LENDER SHALL EXERCISE ANY
RIGHT OF SET-OFF,  BANKER'S  LIEN,  OR THE LIKE  AGAINST ANY DEPOSIT  ACCOUNT OR
PROPERTY OF ANY BORROWER  HELD OR  MAINTAINED  BY SUCH LENDER  WITHOUT THE PRIOR
WRITTEN UNANIMOUS CONSENT OF THE LENDERS.

13.17    Confidentiality.
         ---------------

(a) The  Borrowers  hereby  consent that the Agent and each Lender may issue and
disseminate   to  the  public   general   information   describing   the  credit
accommodation  entered into pursuant to this Agreement,  including the names and
addresses of the Borrowers and a general  description of the Borrowers' business
and may use the Borrowers' names in advertising and other promotional material.

(b) Each of the Agent  and each  Lender  severally  agrees  to take  normal  and
reasonable  precautions and exercise due care to maintain the confidentiality of
all  information  provided  to the  Agent or such  Lender by or on behalf of the
Borrowers, under this Agreement or any other Loan Document, except to the extent
that such information (i) was or becomes generally available to the public other
than as a result of  disclosure  by the  Agent or such  Lender or by a Person to
whom the Agent or such Lender has  delivered  such  information,  or (ii) was or
becomes  available  on a  nonconfidential  basis  from a source  other  than the
Borrowers, provided that such source is not bound by a confidentiality agreement
with, or duty of  confidentiality  owing to, the Borrowers known to the Agent or
such Lender; provided,  however, that the Agent and any Lender may disclose such
information   (1)  at  the  request  or  pursuant  to  any  requirement  of  any
Governmental  Authority  to which the  Agent or such  Lender  is  subject  or in
connection  with  an  examination  of the  Agent  or  such  Lender  by any  such
Governmental  Authority;  (2) pursuant to subpoena or other court  process;  (3)
when  required to do so in  accordance  with the  provisions  of any  applicable
Requirement of Law; (4) to the extent reasonably required in connection with any
litigation  or  proceeding  (including,  but  not  limited  to,  any  bankruptcy
proceeding) to which the Agent, any Lender or their respective Affiliates may be
party; (5) to the extent reasonably  required in connection with the exercise of
any remedy  hereunder  or under any other Loan  Document;  (6) to the Agent's or
such   Lender's   independent   auditors,   accountants,   attorneys  and  other
professional  advisors,  each of whom shall also be bound by the confidentiality
obligations  set forth herein;  (7) to any  prospective  Participant or Assignee
under any Assignment  and  Acceptance,  actual or potential,  provided that such
prospective  Participant or Assignee agrees in writing to keep such  information
confidential to the same extent required of the Agent and the Lenders hereunder;
(8) as expressly  permitted  under the terms of any other  document or agreement
regarding confidentiality to which any Borrower is party or is deemed party with
the Agent or such Lender, and (9) to its Affiliates who have a need to know such
information  (as determined by the Agent or such Lender in good faith),  each of
whom shall also be bound by the confidentiality obligations set forth herein.

13.18 Conflicts with Other Loan Documents.  Unless otherwise  expressly provided
in this  Agreement  (or in another  Loan  Document by specific  reference to the
applicable provision contained in this Agreement), if any provision contained in
this  Agreement  conflicts  with any provision of any other Loan  Document,  the
provision contained in this Agreement shall govern and control.



<PAGE>

     IN WITNESS  WHEREOF,  the parties have  entered into this  Agreement on the
date first above written.
<TABLE>
<S>                                                       <C>


                                                          BORROWERS:


                                                          OWENS CORNING


                                                          By:
                                                          Title:


                                                          CDC CORPORATION


                                                          By:
                                                          Title:

                                                          ENGINEERED YARNS AMERICA, INC.


                                                          By:
                                                          Title:

                                                          FALCON FOAM CORPORATION


                                                          By:
                                                          Title:

                                                          INTEGREX


                                                          By:
                                                          Title:

                                                          FIBREBOARD CORPORATION


                                                          By:
                                                          Title:

                                                          INTEGREX VENTURES LLC


                                                          By:
                                                          Title:

                                                          EXTERIOR SYSTEMS, INC.


                                                          By:
                                                          Title:

                                                          INTEGREX PROFESSIONAL SERVICES LLC


                                                          By:
                                                          Title:

                                                          INTEGREX SUPPLY CHAIN SOLUTIONS LLC


                                                          By:
                                                          Title:

                                                          INTEGREX TESTING SYSTEMS LLC


                                                          By:
                                                          Title:

                                                          HOMEXPERTS LLC


                                                          By:
                                                          Title:

                                                          OWENS-CORNING FIBERGLASS TECHNOLOGY INC.


                                                          By:
                                                          Title:

                                                          OWENS CORNING HT, INC.


                                                          By:
                                                          Title:

                                                          OWENS-CORNING OVERSEAS HOLDINGS, INC.


                                                          By:
                                                          Title:

                                                          OWENS CORNING REMODELING SYSTEMS, LLC


                                                          By:
                                                          Title:

                                                          SOLTECH, INC.


                                                          By:
                                                          Title:

                                                          AGENT:


                                                          Bank of America, N.A., as the Agent


                                                          By:
                                                                   Joseph R. Lehrer
                                                                   Title:  Senior Vice President



                                                          "LENDERS"


                                                          Bank of America, N.A., as a Lender


                                                          By:
                                                                   Joseph R. Lehrer
                                                                   Title:  Senior Vice President

</TABLE>


<PAGE>


                                                      ANNEX A
                                                        to
                                                 Credit Agreement

                                                    Definitions

                  Capitalized  terms used in the Loan  Documents  shall have the
following  respective  meanings  (unless  otherwise  defined  therein),  and all
section  references in the following  definitions shall refer to sections of the
Agreement:

                  "Accounts"  means,  with  respect to any  Person,  all of such
Person's now owned or hereafter acquired or arising accounts,  as defined in the
UCC, including any rights to payment for the sale or lease of goods or rendition
of services, whether or not they have been earned by performance.

                  "Account  Debtor" means each Person obligated in any way on or
in connection with an Account.

                  "ACH  Transactions"  means  any  cash  management  or  related
services  including the automatic  clearing  house transfer of funds by the Bank
for the account of any Borrower pursuant to agreement or overdrafts.

                  "Affiliate"  means, as to any Person,  any other Person which,
directly or  indirectly,  is in control of, is controlled by, or is under common
control with,  such Person or which owns,  directly or  indirectly,  ten percent
(10%) or more of the outstanding  equity interest of such Person. A Person shall
be  deemed  to  control  another  Person if the  controlling  Person  possesses,
directly  or  indirectly,  the power to direct  or cause  the  direction  of the
management  and policies of the other Person,  whether  through the ownership of
voting securities, by contract, or otherwise.

                  "Affiliated  Entity"  means a Subsidiary,  an Affiliate,  or a
Person that uses technology  supplied by, or whose operations are supervised by,
the Company or its Subsidiaries or Affiliates.

                  "Administration Fee" has the meaning specified in Section 2.4.

                  "Agent"  means the Bank,  solely in its  capacity  as agent
for the  Lenders,  and any  successor agent.

                  "Agent-Related  Persons"  means the Agent,  together  with its
Affiliates, and the officers, directors, employees, agents and attorneys-in-fact
of the Agent and such Affiliates.

                  "Aggregate  Revolver  Outstandings"  means,  at  any  date  of
determination:  the sum of (a) the unpaid principal  balance of Revolving Loans,
(b) the aggregate  amount of Pending  Revolving  Loans,  (c) one hundred percent
(100%) of the  aggregate  undrawn  face  amount of all  outstanding  Letters  of
Credit, and (d) the aggregate amount of any unpaid reimbursement  obligations in
respect of Letters of Credit.

                  "Agreement"  means the Credit  Agreement to which this Annex A
is attached, as from time to time amended, modified or restated.

                  "Applicable  L/C  Margin"  means the  Applicable  Margin  with
respect to LIBOR Rate  Loans as from time to time in  effect,  plus,  during the
continuance  of an Event of  Default,  if the Agent or the  Required  Lenders in
their discretion so elect, 2% per annum.

                  "Applicable Margin" means

                  (i)      with  respect  to Base Rate  Loans and all other
                           Obligations  (other  than  LIBOR  Rate Loans), 0%;
                           and

                  (ii)     with respect to LIBOR Rate Loans, .75%.

                  The Applicable  Margins with respect to LIBOR Rate Loans shall
be adjusted (up or down)  prospectively on the first day of each calendar month,
commencing  December 1, 2000, based upon the Average Daily Outstanding  Exposure
during the  immediately  preceding  calendar  month, as calculated by the Agent.
Adjustments  in  Applicable  Margins  shall be  determined  by  reference to the
following grid:
<TABLE>
<S>                                                <C>

------------------------------------------------ ----------------------------------
Average Daily                                    Level of
Outstanding Exposure                             Applicable Margins:
------------------------------------------------ ----------------------------------
------------------------------------------------ ----------------------------------
>$300,000,000                                    2.00%
------------------------------------------------ ----------------------------------
------------------------------------------------ ----------------------------------
>$200,000,000, but < $300,000,000                1.50%
                   -
------------------------------------------------ ----------------------------------
------------------------------------------------ ----------------------------------
>$100,000,000, but < $200,000,000                1.00%
                   -
------------------------------------------------ ----------------------------------
------------------------------------------------ ----------------------------------
< $100,000,000                                   .75%
-
------------------------------------------------ ----------------------------------
</TABLE>

                  "Assignee" has the meaning specified in Section 11.2(a).

                  "Assignment  and  Acceptance"  has the  meaning  specified  in
Section 11.2(a).

                  "Attorney  Costs"  means and  includes  all  reasonable  fees,
expenses  and  disbursements  of any law firm or other  counsel  engaged  by the
Agent,  excluding allocated costs and expenses of internal legal services of the
Agent.

                  "Availability"  means,  at any time (a) the  lesser of (i) the
Maximum  Revolver  Amount or (ii) the  Borrowing  Base as  reflected in the most
recent  Borrowing  Base  Certificate  delivered  to the Agent  pursuant  to this
Agreement  (as such amount may be reduced by Reserves  established  by the Agent
following the date of such Borrowing Base  Certificate)  minus (b) the Aggregate
Revolver Outstandings.

                  "Average Daily Outstanding Exposure" means, for any period, an
amount equal to the average daily Aggregate Revolver Outstandings (excluding any
Pending Revolving Loans) during such period.

                  "Bank" means Bank of America,  N.A., a national  banking
association,  or any  successor  entity thereto.

                  "Bank  Products"  means any one or more of the following types
of services or facilities  extended to any Borrower by the Bank or any affiliate
of the Bank in reliance on the Bank's agreement to indemnify such affiliate: (i)
credit cards; (ii) ACH Transactions; (iii) cash management, including controlled
disbursement services; and (iv) Hedge Agreements.

                  "Bank  Product  Reserves"  means all reserves  which the Agent
from time to time establishes in its reasonable discretion for the Bank Products
then provided or outstanding.

                  "Bankruptcy Case" has the meaning specified in the recitals to
this Agreement.

                  "Bankruptcy Code" means Title 11 of the United States Code
(11 U.S.C.ss. 101 et seq.).


                  "Bankruptcy  Court" means the United States  Bankruptcy  Court
for the District of Delaware,  or any other court having  jurisdiction  over the
Bankruptcy Cases from time to time,  including,  without limitation,  the United
States  District  Court for the  District  of  Delaware  if and to the extent it
withdraws the reference with respect to the Bankruptcy  Cases, any part thereof,
or any matter or proceeding therein.

                  "Base Rate" means, for any day, the rate of interest in effect
for such day as publicly  announced  from time to time by the Bank in Charlotte,
North  Carolina as its "prime  rate" (the  "prime  rate" being a rate set by the
Bank based upon various  factors  including the Bank's costs and desired return,
general economic conditions and other factors,  and is used as a reference point
for pricing some loans,  which may be priced at, above,  or below such announced
rate).  Any change in the prime rate  announced by the Bank shall take effect at
the opening of business on the day specified in the public  announcement of such
change.  Each  Interest  Rate  based  upon  the  Base  Rate  shall  be  adjusted
simultaneously with any change in the Base Rate.

                  "Base Rate Loans" means the Base Rate Revolving Loans.
                   ---------------

                  "Base Rate  Revolving  Loan" means a Revolving Loan during any
period in which it bears interest based on the Base Rate.

                  "Borrower" and "Borrowers"  have the meanings set forth in the
Preamble to the Agreement.

                  "Borrower Representative" has the meaning set forth in Section
1.2(c).

                  "Borrowing"   means  a  borrowing   hereunder   consisting  of
Revolving  Loans made on the same day by the Lenders to the Borrowers or by Bank
in the case of a Borrowing  funded by  Non-Ratable  Loans or by the Agent in the
case of a Borrowing  consisting of an Agent Advance,  or the issuance of Letters
of Credit hereunder.

                  "Borrowing  Base" means,  at any time,  an amount equal to (a)
the sum of (A) up to  eighty-five  percent  (85%) of the Net Amount of  Eligible
Accounts; plus (B) up to sixty percent (60%) of the value of Eligible Inventory;
minus (b) Reserves from time to time  established by the Agent in its reasonable
credit  judgment;  provided that the aggregate  Revolving Loans advanced against
Eligible Inventory shall not exceed the Maximum Inventory Loan Amount.

                  "Borrowing  Base  Availability"  means, at any time, an amount
calculated  in the manner set forth in the  definition  of  "Availability",  but
without  taking  into  account the  limitation  on  Availability  imposed by the
Maximum Revolver Amount.

                  "Borrowing  Base   Certificate"   means  a  certificate  by  a
Responsible Officer of the Borrower Representative, substantially in the form of
Exhibit B (or another form reasonably acceptable to the Agent) setting forth the
calculation  of the Borrowing  Base,  including a calculation  of each component
thereof,  all in such detail as shall be reasonably  satisfactory  to the Agent.
All calculations of the Borrowing Base in connection with the preparation of any
Borrowing   Base   Certificate   shall   originally  be  made  by  the  Borrower
Representative and certified to the Agent;  provided,  that the Agent shall have
the right to  review  and  adjust,  in the  exercise  of its  reasonable  credit
judgment,  any such  calculation  to the extent that such  calculation is not in
accordance with this Agreement.

                  "Business  Day"  means  (a)  any day  that is not a  Saturday,
Sunday, or a day on which banks in Chicago, Illinois,  Charlotte, North Carolina
or Toledo,  Ohio are required or permitted to be closed, and (b) with respect to
all notices, determinations,  fundings and payments in connection with the LIBOR
Rate or LIBOR Rate Loans,  any day that is a Business Day pursuant to clause (a)
above and that is also a day on which  trading  in  Dollars is carried on by and
between banks in the London interbank market.

                  "Capital Adequacy Regulation" means any guideline,  request or
directive of any central bank or other Governmental Authority, or any other law,
rule or  regulation,  whether  or not  having  the force of law,  in each  case,
regarding capital adequacy of any bank or of any corporation controlling a bank.

                  "Capital Lease" means,  with respect to any Person,  any lease
of property by such Person which, in accordance  with GAAP,  should be reflected
as a capital lease on the balance sheet of the such Person.

                  "Carve-Out" has the meaning specified in Section 7.25.

                  "Carve-Out Event" has the meaning specified in Section 7.25.

                  "Cash   Equivalents"  means  (a)  direct  obligations  of,  or
obligations  guaranteed by, the United States of America or any agency  thereof,
(b)  commercial  paper issued in the United States of America and rated at least
A-1 or P-1 by at  least  one  nationally  recognized  rating  organization,  (c)
certificates  of deposit issued by or eurodollar  deposits made with any Lender,
any  Affiliate  of any Lender,  or any bank or trust  company  which has (or the
parent of which has) capital, surplus and undivided profits aggregating at least
$100,000,000 (or the equivalent amount in another currency), (d) drafts accepted
by any bank or trust  company  referred  to in  clause  (c)  above or any  other
negotiable instrument guaranteed or endorsed with full recourse by any such bank
or trust company, (e) repurchase agreements with respect to any of the foregoing
types of securities  described in clauses (a) and (b) above,  (f) investments in
money market funds substantially all of whose assets are comprised of securities
of the types  described  in clause (a) through (e) above,  (g)  obligations  the
return with respect to which is excluded  from gross income under Section 103 of
the Code,  with a maturity  of not more than six months or with the right of the
holder to put such  obligations  for  purchase  at par upon not more than  seven
days' notice and which are rated at least A-1 or P-1 by at least one  nationally
recognized rating organization,  (h) (A) tax free money market funds that invest
solely  in the  securities  described  in clause  (g) above or (B) money  market
preferred  municipal bond fund which have a term of not more than seven days and
which are rated at least AAA or the  equivalent  thereof  by  Standard  & Poor's
Ratings  Group or at least Aaa or the  equivalent  thereof by Moody's  Investors
Service,  Inc., and (i) any other securities  reasonably acceptable to the Agent
which are rated at least A-1 or P-1 by at least one nationally recognized rating
organization,  or which are of an equivalent  credit  quality in the  reasonable
judgment of the Agent,  provided that (i) each such  obligation,  certificate of
deposit, draft, investment,  security and instrument (including those subject to
repurchase  agreements)  matures  within one year after it is acquired  and (ii)
each item of such  commercial  paper  (including  those  subject  to  repurchase
agreements)  matures  within six months  after it is acquired by the Borrower or
any Other Subsidiary.

                  "Change of Control" means any of the following: (a) any Person
or group of Persons (within the meaning of the Securities  Exchange Act of 1934,
as amended) shall have acquired beneficial ownership (within the meaning of Rule
13d-3 promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended) of 50.1% or more of the issued and outstanding
shares of capital stock of the Company having the right to vote for the election
of directors of the Company under ordinary circumstances;  (b) during any period
of twelve consecutive calendar months,  individuals who at the beginning of such
period  constituted the board of directors of the Company (together with any new
directors  whose  election  by the board of  directors  of the  Company or whose
nomination  for  election by the  stockholders  of the Company was approved by a
vote of at least a  majority  of the  directors  then still in office who either
were  directors at the beginning of such period or whose  election or nomination
for election was  previously so approved)  cease for any reason other than death
or disability to constitute a majority of the directors then in office;  (c) the
Company ceases to own and control,  directly or indirectly,  all of the economic
and voting rights  associated with all of the outstanding  capital stock of each
other  Borrower  other  than  Integrex;  and (e) the  Company  ceases to own and
control all of the economic and voting  rights  associated  with at least 96% of
the outstanding capital stock of Integrex.

                  "Closing Date" means the date of the Agreement.

                  "Code" means the Internal Revenue Code of 1986.

                  "Committee"  means,  collectively,  the official  committee of
unsecured creditors appointed in the Bankruptcy Cases and the official committee
of asbestos claimants appointed in the Bankruptcy Cases.

                  "Commitment" or "Revolving Loan Commitment" means, at any time
with respect to a Lender,  the  principal  amount set forth beside such Lender's
name under the heading "Commitment" on Schedule 1.1 attached to the Agreement or
on the signature page of the  Assignment  and Acceptance  pursuant to which such
Lender became a Lender  hereunder in accordance  with the  provisions of Section
11.2, as such  Commitment  may be adjusted from time to time in accordance  with
the  provisions of Section 11.2,  and  "Commitments"  means,  collectively,  the
aggregate amount of the commitments of all of the Lenders.

                  "Company"  has the meaning  set forth in the  Preamble to this
Agreement.

                  "Consolidated EBITDA" means, for any period, Consolidated Net
Income for such period, plus

     (i) any amount deducted (or in the case of extraordinary  gains,  minus any
amount added) in the computation of Consolidated  Net Income for such period for
(A) depreciation and amortization expense, (B) provisions for all federal, state
and local income and franchise taxes, (C) consolidated interest expense, (D) any
extraordinary  gains or losses,  (E) amortization of transaction  costs incurred
with respect to the merger and recapitalization of the Company effected pursuant
to the Plan of  Recapitalization  and Agreement of Merger dated as of August 28,
1986  between  Owens-Corning  Recap Corp.  and the  Company,  (F)  additions  to
reserves with respect to actions,  suits or  proceedings  against the Company or
any  Subsidiary  with respect to claims arising out of the use of or exposure to
asbestos products, (G) any non-cash expenses,  non-cash losses or other non-cash
charges  resulting  from the  impairment  or  write-down in the valuation of any
assets,  (H) any  non-recurring  charge,  reorganization  cost or  restructuring
charge, (I) expenses arising from claims in the Reorganization Cases for allowed
professional  fees and  disbursements,  the expenses of members of any statutory
committees appointed in the Reorganization  Cases, trustee fees and fees payable
to the Clerk of the Bankruptcy Court, (J) expenses,  losses and other charges in
respect  of  employee  retention  bonuses  and other  payments  approved  by the
Bankruptcy  Court,  (K)  non-cash-losses  or gains  arising from the freezing or
termination of any plan or other employee benefit or welfare plan and (L) losses
or gains arising from asset dispositions, minus

     (ii) any amount added in the  computation  of  Consolidated  Net Income for
such period for reductions in the reserves  referred to in clause  (i)(F),  plus


(iii)    to the extent deducted in the  computation of  Consolidated  Net Income
         for such  period,  the amount of any  restructuring  or other  reserves
         (other than reserves for  uncollectible  accounts  receivable and other
         reserves created in the ordinary course of business) established by the
         Company and its consolidated Subsidiaries, minus

(iv)     to the extent added in the computation of  Consolidated  Net Income for
         such period,  the amount of any reductions in the reserves  referred to
         in the preceding clause (iii).

                  "Consolidated Net Income" means, for any period, the amount of
consolidated  net  income  (or net  loss) of the  Company  and the  consolidated
Subsidiaries for such period (taken as a cumulative whole).

                  "Continuation/Conversion  Date" means the date on which a Loan
is converted into or continued as a LIBOR Rate Loan.

                  "Credit Support" has the meaning specified in Section 1.4(a).

                  "Debt"   means,   without   duplication,    all   liabilities,
obligations  and  indebtedness  of any Borrower or any Other  Subsidiary  to any
Person, of any kind or nature, now or hereafter owing,  arising, due or payable,
howsoever  evidenced,  created,  incurred,  acquired or owing,  whether primary,
secondary,  direct, contingent,  fixed or otherwise,  consisting of indebtedness
for borrowed money or the deferred  purchase price of property,  excluding trade
payables, but including (a) all Obligations; (b) all obligations and liabilities
of any Person  secured by any Lien on any  Borrower's or any Other  Subsidiary's
property,  even though such Borrower or Other  Subsidiary shall not have assumed
or become  liable for the  payment  thereof;  provided,  however,  that all such
obligations and liabilities which are limited in recourse to such property shall
be  included  in Debt only to the extent of the book value of such  property  as
would be shown  on a  balance  sheet of any  Borrower  or any  Other  Subsidiary
prepared in accordance with GAAP; (c) all obligations or liabilities  created or
arising under any Capital  Lease or  conditional  sale or other title  retention
agreement with respect to property used or acquired by any Borrower or any Other
Subsidiary,  even if the rights and  remedies  of the  lessor,  seller or lender
thereunder are limited to repossession of such property; provided, however, that
all such  obligations  and  liabilities  which are  limited in  recourse to such
property  shall be included in Debt only to the extent of the book value of such
property  as would be shown on a  balance  sheet of any  Borrower  or any  Other
Subsidiary  prepared  in  accordance  with  GAAP;  and (d) all  obligations  and
liabilities under Guaranties.

                  "Default"  means any  event or  circumstance  which,  with the
giving of notice,  the lapse of time, or both, would (if not cured,  waived,  or
otherwise remedied during such time) constitute an Event of Default.

                  "Default Rate" means a fluctuating  per annum interest rate at
all times equal to the sum of (a) the  otherwise  applicable  Interest Rate plus
(b)  two  percent   (2%)  per  annum.   Each  Default  Rate  shall  be  adjusted
simultaneously with any change in the applicable Interest Rate.

                  "Defaulting  Lender"  has the  meaning  specified  in  Section
12.15(c).

                  "Designated  Account"  has the  meaning  specified  in Section
1.2(c).

                  "Distribution"  means, in respect of any corporation:  (a) the
payment or making of any dividend or other  distribution  of property in respect
of capital  stock (or any options or warrants  for, or other rights with respect
to, such stock) of such  corporation,  other than dividends or  distributions in
capital stock (or any options or warrants for such stock) of the same class;  or
(b) the redemption or other acquisition by such corporation of any capital stock
(or any options or warrants for such stock) of such corporation.

                  "DOL"  means  the  United  States  Department  of Labor or any
successor department or agency.

                  "Dollar" and "$" means  dollars in the lawful  currency of the
United  States.  Unless  otherwise  specified,  all payments under the Agreement
shall be made in Dollars.

                  "Eligible  Accounts" means all Accounts owned by the Borrowers
except for any Account:

                  (a) with respect to which more than 90 days have elapsed since
the date of the  original  invoice  therefor  or which is more than 60 days past
due;

                  (b)      with  respect  to  which  any  of  the
representations,   warranties,   covenants,  and agreements contained in Section
7.26 are incorrect or have been breached;

                  (c) with  respect  to which  Account,  in whole or in part,  a
check,  promissory  note,  draft,  trade  acceptance or other instrument for the
payment  of  money  has  been  received,  presented  for  payment  and  returned
uncollected for any reason;

                  (d)  which  represents  a  progress  billing  (as  hereinafter
defined)  or as to which  the  applicable  Borrower  has  extended  the time for
payment  without the consent of the Agent;  for the purposes  hereof,  "progress
billing" means any invoice for goods sold or leased or services rendered under a
contract or agreement  pursuant to which the Account Debtor's  obligation to pay
such invoice is  conditioned  upon the applicable  Borrower's  completion of any
further performance under the contract or agreement;

                  (e) with  respect  to which  any one or more of the  following
events has  occurred to the  Account  Debtor on such  Account:  the filing by or
against  the  Account   Debtor  of  a  request  or  petition  for   liquidation,
reorganization,  arrangement,  adjustment of debts,  adjudication as a bankrupt,
winding-up, or other relief under the bankruptcy, insolvency, or similar laws of
the United States, any state or territory thereof, or any foreign  jurisdiction,
now or hereafter in effect;  the making of any general assignment by the Account
Debtor for the benefit of creditors;  the  appointment  of a receiver or trustee
for  the  Account  Debtor  or for  any  of the  assets  of the  Account  Debtor,
including,  without  limitation,  the  appointment of or taking  possession by a
"custodian,"  as defined in the Bankruptcy  Code; the  institution by or against
the  Account  Debtor of any  other  type of  insolvency  proceeding  (under  the
bankruptcy  laws of the United States or otherwise) or of any formal or informal
proceeding for the dissolution or liquidation of,  settlement of claims against,
or winding up of  affairs  of, the  Account  Debtor;  the sale,  assignment,  or
transfer of all or any material part of the assets of the Account Debtor (to the
extent the Borrowers have actual knowledge thereof); the nonpayment generally by
the Account  Debtor of its debts as they become  due;  or the  cessation  of the
business of the Account  Debtor as a going  concern (to the extent the Borrowers
have actual knowledge thereof);

                  (f) if fifty  percent  (50%) or more of the  aggregate  Dollar
amount of  outstanding  Accounts owed at such time by the Account Debtor thereon
is classified as ineligible under clause (a) above;

                  (g) owed by an Account  Debtor which:  (i) does not maintain a
principal  place of  business in the United  States of America or Canada  (other
than the Province of  Newfoundland);  or (ii) is not organized under the laws of
the United States of America or Canada or any state or province  thereof (unless
otherwise  notified by the Agent,  the Borrowers may rely on "bill to" and "ship
to"  instructions  from  Account  Debtors  in  determining  which  Accounts  are
ineligible  pursuant to the  criteria in this clause (ii) and clause (i) above);
or (iii) is the government of any foreign country or sovereign  state, or of any
state, province, municipality, or other political subdivision thereof, or of any
department, agency, public corporation, or other instrumentality thereof; except
to the  extent  that such  Account  is  secured or payable by a letter of credit
reasonably satisfactory to the Agent in its discretion;

                  (h)      owed by an Account  Debtor  which is an  Affiliate
or employee of the Company or any of its Subsidiaries;

                  (i)  that  is  subject  to any  Lien  whatsoever  (other  than
Permitted  Liens imposed by operation of law provided that such Permitted  Liens
are, at the election of the Agent,  subject to Reserves) or which is not subject
to the Superpriority  Administrative Claim in favor of the Agent for the benefit
of the Lenders;

                  (j) owed by an Account  Debtor to which any Borrower or any of
its  Subsidiaries,  is  indebted in any way, or which is subject to any right of
setoff or  recoupment  by the  Account  Debtor,  unless the  Account  Debtor has
entered into an agreement  acceptable to the Agent to waive setoff rights; or if
the Account Debtor thereon has disputed liability or made any claim with respect
to any other Account due from such Account Debtor; but in each such case only to
the extent of such indebtedness, setoff, recoupment, dispute, or claim;

                  (k) which  represents  a sale on a  bill-and-hold,  guaranteed
sale, sale and return,  sale on approval,  consignment,  or other  repurchase or
return basis  (except with  respect to an Account in  connection  with which the
Account  Debtor  is  entitled  to  return  Inventory  solely on the basis of the
quality of such Inventory);

                  (l)      which is evidenced by a promissory note or other
instrument or by chattel paper;

                  (m) with respect to which the Account Debtor is located in any
state requiring the filing of a Notice of Business  Activities Report or similar
report in order to permit the applicable  Borrower to seek judicial  enforcement
in such State of payment of such Account,  unless such Borrower has qualified to
do business in such state or has filed a Notice of Business Activities Report or
equivalent report for the then current year;

                  (n)      which  arises  out  of a sale  not  made  in  the
ordinary  course  of  the  applicable Borrower's business; or

                  (o)  with  respect  to which  the  goods  giving  rise to such
Account  have not been  shipped  and  delivered  to and  accepted by the Account
Debtor or the services  giving rise to such  Account have not been  performed by
the applicable Borrower, and, if applicable,  accepted by the Account Debtor, or
the Account Debtor has revoked its acceptance of such goods or services.

                  If any Account at any time  ceases to be an Eligible  Account,
then such Account shall  promptly be excluded from the  calculation  of Eligible
Accounts.

                  "Eligible  Assignee" means (a) a commercial  bank,  commercial
finance  company or other asset based  lender,  having total assets in excess of
$1,000,000,000;  (b) any Lender listed on the signature page of this  Agreement;
(c) any Affiliate of any Lender; and (d) if an Event of Default has occurred and
is continuing, any other Person reasonably acceptable to the Agent that is not a
direct competitor of the Company or any of its consolidated Subsidiaries;

                  "Eligible   Inventory"   means  all  Inventory  owned  by  the
Borrowers,  valued  at the  lower of cost (on a  first-in,  first-out  basis) or
market, except any Inventory:

                  (a)      that is not owned by one of the Borrowers;

                  (b)  that  is  subject  to any  Lien  whatsoever  (other  than
Permitted  Liens imposed by operation of law provided that such Permitted  Liens
are, at the Agent's election, subject to Reserves) or that is not subject to the
Superpriority  Administrative Claim in favor of the Agent for the benefit of the
Lenders;

                  (c) that does not consist of finished  goods or raw  materials
(other  than de  minimus  amounts  of  work-in-process  that are not  separately
accounted for by the Borrowers due to the de minimus nature thereof);

                  (d) that  consists of  work-in-process  (other than de minimus
amounts  of  work-in-process  that  are  not  separately  accounted  for  by the
Borrowers due to the de minimus nature thereof), samples,  prototypes,  supplies
not constituting raw materials, or packing and shipping materials;

                  (e) that is not in good condition, is unmerchantable,  or does
not meet all standards imposed by any Governmental Authority,  having regulatory
authority over such goods, their use or sale;

                  (f) that is not currently either usable or salable,  at prices
approximating at least cost, in the normal course of the Borrower's business, or
that is slow moving or stale;

                  (g)      that is obsolete or returned or repossessed or used
goods taken in trade;

                  (h)      that is  located  outside  the  United  States of
America  (or that is  in-transit  from vendors or suppliers);

                  (i)      that is not reflected in the details of the
Borrowers' general ledger reports; or

                  (j)      that is  Inventory  acquired or accepted by any
Borrower on a  consignment  or approval basis or that is placed on consignment.

                  Unless otherwise  notified by the Agent, the Borrowers may, in
lieu of excluding individual items of Inventory which would be deemed ineligible
under the  criteria  set forth in clauses  (e),  (f) and (g)  above,  reduce the
aggregate  value of  Eligible  Inventory  included  in the  Borrowing  Base by a
reserve in the estimated amount thereof.

                  If any Inventory at any time ceases to be Eligible  Inventory,
such  Inventory  shall  promptly be excluded  from the  calculation  of Eligible
Inventory.

                  "Environmental  Laws"  means any and all  Applicable  Laws (as
defined  below)  regulating,  relating to or imposing  liability or standards of
conduct concerning  protection of human health or safety or the environment,  as
now or may at any time hereafter be in effect,  including,  without  limitation,
the Clean Water Act, the Comprehensive Environmental Response,  Compensation and
Liability  Act, the Superfund  Amendment and  Reauthorization  Act of 1986,  the
Emergency  Planning and Community  Right to Know Act, the Resource  Conservation
and Recovery Act, the Safe Drinking Water Act, the Toxic Substances Control Act,
and the Endangered  Species Act,  together,  in each case,  with each amendment,
supplement  or  other  modification   thereto,   the  regulations   adopted  and
publications promulgated thereunder and all substitutions therefor. For purposes
hereof,   "Applicable   Law"  means  all   applicable   provisions  of  all  (a)
constitutions, statutes, treaties, rules, regulations and orders of governmental
bodies,  (b)  authorizations,  consents,  approvals,  licenses or exemptions of,
registrations and filings with, reports and notices to, all governmental  units,
and (c) orders, decisions, judgments and decrees of all courts and arbitrators.

                  "Equipment"  means,  with  respect to any Person,  all of such
Person's  now owned and  hereafter  acquired  machinery,  equipment,  furniture,
furnishings,  fixtures, and other tangible personal property (except Inventory),
including embedded software,  motor vehicles with respect to which a certificate
of title has been issued,  aircraft, dies, tools, jigs, and office equipment, as
well as all of such  types of  property  leased by such  Person  and all of such
Person's rights and interests with respect thereto under such leases (including,
without limitation,  options to purchase);  together with all present and future
additions and accessions thereto, replacements therefor, component and auxiliary
parts  and  supplies  used  or to be  used  in  connection  therewith,  and  all
substitutes for any of the foregoing, and all manuals,  drawings,  instructions,
warranties  and rights with respect  thereto;  wherever any of the  foregoing is
located.

                  "ERISA" means the Employee  Retirement  Income Security Act of
1974, as amended and regulations promulgated thereunder.

                  "ERISA  Affiliate" means any trade or business (whether or not
incorporated)  under  common  control  with any  Borrower  within the meaning of
Section  414(b) or (c) of the Code (and Sections  414(m) and (o) of the Code for
purposes of provisions relating to Section 412 of the Code).

                  "ERISA  Event" means (a) a Reportable  Event with respect to a
Pension  Plan,  (b) a withdrawal by any Borrower or any ERISA  Affiliate  from a
Pension Plan subject to Section 4063 of ERISA during a plan year in which it was
a  substantial  employer  (as  defined  in  Section  4001(a)(2)  of  ERISA) or a
cessation  of  operations  which is treated as such a withdrawal  under  Section
4062(e) of ERISA,  (c) a complete or partial  withdrawal  by any Borrower or any
ERISA Affiliate from a Multi-employer Plan or notification that a Multi-employer
Plan is in  reorganization,  (d) the filing of a notice of intent to  terminate,
the treatment of a Plan  amendment as a termination  under Section 4041 or 4041A
of ERISA, or the  commencement of proceedings by the PBGC to terminate a Pension
Plan or  Multi-employer  Plan, (e) the occurrence of an event or condition which
might  reasonably be expected to constitute  grounds under Section 4042 of ERISA
for the  termination  of, or the  appointment  of a trustee to  administer,  any
Pension Plan or  Multi-employer  Plan,  or (f) the  imposition  of any liability
under Title IV of ERISA,  other than for PBGC  premiums  due but not  delinquent
under Section 4007 of ERISA, upon any Borrower or any ERISA Affiliate.

                  "Event of Default" has the meaning specified in Section 9.1.

                  "Exchange Act" means the Securities  Exchange Act of 1934, and
regulations promulgated thereunder.

                  "Facility Fee" has the meaning specified in Section 2.4.

                  "FDIC" means the Federal Deposit  Insurance  Corporation,  and
any Governmental Authority succeeding to any of its principal functions.

                  "Federal  Funds Rate"  means,  for any day, the rate per annum
(rounded  upwards,  if  necessary,  to the  nearest  1/100  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 Business Day
next succeeding  such day;  provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such  transactions  on
the next preceding Business Day as so published on the next succeeding  Business
Day, and (b) if no such rate is so published  on such next  succeeding  Business
Day,  the Federal  Funds Rate for such day shall be the average  rate charged to
the Bank on such day on such transactions as determined by the Agent.

                  "Federal  Reserve  Board"  means the Board of Governors of the
Federal Reserve System or any successor thereto.

                  "Fee Budget" means the amount set forth for professional  fees
and  disbursements  expected  to be  incurred  by the  Borrowers  and  statutory
committees in the Bankruptcy Cases as set forth in the Projections.

                  "Fibreboard  Settlement Trust" means the Fibreboard Settlement
Trust established under the Trust Agreement dated December 30, 1996.

                  "Filing  Date"  has the  meaning  set  forth  in the  recitals
hereto.

                  "Final Order" has the meaning specified in Section 8.2.

                  "Financial  Statements"  means,  according  to the  context in
which it is used, the financial statements referred to in Sections 5.2 or 6.5.

                  "Fiscal Year" means the  Borrowers'  fiscal year for financial
accounting  purposes.  The  current  Fiscal  Year of the  Borrowers  will end on
December 31, 2000.

                  "Funding Date" means the date on which a Borrowing occurs.

                  "GAAP" means  generally  accepted  accounting  principles  and
practices set forth from time to time in the opinions and  pronouncements of the
Accounting  Principles  Board and the American  Institute  of  Certified  Public
Accountants  and  statements  and  pronouncements  of the  Financial  Accounting
Standards  Board (or agencies with similar  functions of comparable  stature and
authority within the U.S. accounting profession),  which are in effect from time
to time in the United States.

                  "Governmental  Authority" means any nation or government,  any
state  or  other  political  subdivision  thereof,  any  court  and  any  entity
exercising  executive,  legislative,   judicial,  regulatory  or  administrative
functions of or pertaining to government.

                  "Guaranty" means, with respect to any Person,  all obligations
of such Person which in any manner  directly or indirectly  guarantee or assure,
or  in  effect   guarantee  or  assure,   the  payment  or  performance  of  any
indebtedness, dividend or other obligations of any other Person (the "guaranteed
obligations"),  or assure  or in  effect  assure  the  holder of the  guaranteed
obligations  against loss in respect  thereof,  including  any such  obligations
incurred  through an agreement,  contingent  or  otherwise:  (a) to purchase the
guaranteed  obligations or any property constituting  security therefor;  (b) to
advance  or  supply  funds  for  the  purchase  or  payment  of  the  guaranteed
obligations or to maintain a working  capital or other balance sheet  condition;
or (c) to lease  property or to purchase any debt or equity  securities or other
property or  services.  The amount of any  Guaranty of any  guaranteeing  Person
shall  be  deemed  to be the  lower of (i) an  amount  equal  to the  stated  or
determinable  amount of the primary obligation in respect of which such Guaranty
is made and (ii) the maximum  amount for which such  guaranteeing  Person may be
liable pursuant to the terms of the instrument  embodying such Guaranty,  unless
such  primary  obligation  and the  maximum  amount for which such  guaranteeing
Person may be liable are not stated or determinable, in which case the amount of
such Guaranty shall be such guaranteeing Person's maximum reasonably anticipated
liability in respect thereof as determined by such  guaranteeing  Person in good
faith.

                  "Hedge Agreement" means any and all  transactions,  agreements
or documents  now  existing or hereafter  entered  into,  which  provides for an
interest rate,  credit,  commodity or equity swap, cap, floor,  collar,  forward
foreign exchange transaction,  currency swap, cross currency rate swap, currency
option,  or any  combination  of, or option with  respect  to,  these or similar
transactions,  for the purpose of hedging any Person's  exposure to fluctuations
in interest or  exchange  rates,  loan,  credit  exchange,  security or currency
valuations or commodity prices.

                  "Indemnification  Liabilities"  has the  meaning  set forth in
Section 13.11.

                  "Indemnified  Person"  has the  meaning  set forth in  Section
13.11.

                  "Interest Period" means, as to any LIBOR Rate Loan, the period
commencing  on the Funding  Date of such Loan or on the  Continuation/Conversion
Date on which the Loan is converted  into or continued as a LIBOR Rate Loan, and
ending on the date one, two,  three or six months  thereafter as selected by the
Borrower  Representative in its Notice of Borrowing, in the form attached hereto
as Exhibit D, or Notice of Continuation/Conversion,  in the form attached hereto
as Exhibit E, provided that:

                  (a) if any Interest  Period would  otherwise end on a day that
is not a Business Day,  that Interest  Period shall be extended to the following
Business Day unless the result of such extension would be to carry such Interest
Period into another  calendar  month,  in which event such Interest Period shall
end on the preceding Business Day;

                  (b) any Interest  Period  pertaining to a LIBOR Rate Loan that
begins on the last 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 end on the last Business Day of the calendar month at the
end of such Interest Period; and

                  (c)      no Interest Period shall extend beyond the Stated
Termination Date.

                  "Interest  Rate"  means  each  or any of the  interest  rates,
including the Default Rate, set forth in Section 2.1.

                  "Inventory"  means,  with  respect to any  Persons all of such
Person's now owned and  hereafter  acquired  inventory,  goods and  merchandise,
wherever located, to be furnished under any contract of service or held for sale
or lease,  all returned goods,  raw materials,  work-in-process,  finished goods
(including embedded software),  other materials and supplies of any kind, nature
or description  which are used or consumed in such Person's  business or used in
connection with the packing, shipping, advertising, selling or finishing of such
goods,  merchandise,  and all documents of title or other documents representing
them.

                  "Investments"   has  the  meaning   given  such  term  in  the
definition of "Restricted Investments".

                  "IRS" means the Internal  Revenue Service and any Governmental
Authority succeeding to any of its principal functions under the Code.

                  "Jackson Equipment" means (a) the new manufacturing  equipment
acquired by the Jackson  Industrial  Development Board or other Persons that are
not  Affiliates  of the Company for use on the Jackson  Real Estate prior to the
date  hereof  and (b)  associated  leasehold  improvements  made by the  Jackson
Industrial  Development  Board or other  Persons that are not  Affiliates of the
Company on the Jackson Real Estate.

                  "Jackson  Real Estate"  means the  approximately  200 acres of
land in Jackson,  Tennessee and the buildings thereon transferred by the Company
to the Jackson Industrial  Development Board pursuant to the Jackson transaction
prior to the date hereof.

                  "Jackson Transaction" means the transactions consummated prior
to the date hereof  pursuant to which (i) the  Company  transferred  the Jackson
Real  Estate to the  Jackson  Industrial  Development  Board  ("JIDB")  and such
property was leased back to the Company, and (ii) JIDB or other Persons that are
not Affiliates of the Company leased the Jackson Equipment to the Company.

                  "Latest  Projections"  means: (a) on the Closing Date, the
Projections;  and (b) thereafter,  the projections most recently received by
the Agent pursuant to Section 5.2(f).


                  "Lender"  and  "Lenders"  have the  meanings  specified in the
introductory  paragraph  hereof and shall  include the Bank to the extent of any
Non-Ratable  Loan  outstanding;  provided that no such Non-Ratable Loan shall be
taken into account in determining any Lender's Pro Rata Share.

                  "Letter  of  Credit"  has the  meaning  specified  in  Section
1.4(a).

                  "Letter of Credit  Fee" has the meaning  specified  in Section
2.6.

                  "Letter of Credit Issuer" means the Bank, any affiliate of the
Bank or any  other  financial  institution  that  issues  any  Letter  of Credit
pursuant to this Agreement.

                  "Letter of Credit Subfacility" means $300,000,000.

                  "LIBOR Interest  Payment Date" means,  with respect to a LIBOR
Rate  Loan,  the  Termination  Date  and the last  day of each  Interest  Period
applicable to such Loan or, with respect to each Interest Period of greater than
three  months  in  duration,  the last day of the third  month of such  Interest
Period and the last day of such Interest Period.

                  "LIBOR Rate" means, for any Interest  Period,  with respect to
LIBOR Rate Loans,  the rate of  interest  per annum  determined  pursuant to the
following formula:

                  LIBOR Rate  =                    Offshore Base Rate
                                 ---------------------------------------------
                                        1.00 - Eurodollar Reserve Percentage
                  Where,

                  "Offshore  Base Rate"  means the rate per annum  appearing  on
Telerate Page 3750 (or any successor page) as the London interbank  offered rate
for deposits in Dollars at  approximately  11:00 a.m. (London time) two Business
Days prior to the first day of such  Interest  Period for a term  comparable  to
such Interest Period. If for any reason such rate is not available, the Offshore
Base Rate shall be, for any  Interest  Period,  the rate per annum  appearing on
Reuters  Screen LIBO Page as the London  interbank  offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period for a term comparable to such Interest Period;
provided,  however,  if more than one rate is specified  on Reuters  Screen LIBO
Page, the applicable rate shall be the arithmetic mean of all such rates. If for
any reason none of the  foregoing  rates is  available,  the Offshore  Base Rate
shall be, for any Interest Period, the rate per annum determined by Agent as the
rate of interest at which dollar deposits in the approximate amount of the LIBOR
Rate Loan  comprising  part of such  Borrowing  would be  offered  by the Bank's
London  Branch to major banks in the offshore  dollar market at their request at
or about 11:00 a.m.  (London  time) two Business  Days prior to the first day of
such Interest Period for a term comparable to such Interest Period; and

                  "Eurodollar  Reserve Percentage" means, for any day during any
Interest Period, the reserve percentage (expressed as a decimal,  rounded upward
to the next  1/100th  of 1%) in effect on such day  applicable  to member  banks
under  regulations  issued  from time to time by the Federal  Reserve  Board for
determining   the  maximum   reserve   requirement   (including  any  emergency,
supplemental or other marginal reserve requirement) with respect to Eurocurrency
funding (currently  referred to as "Eurocurrency  liabilities").  The LIBOR Rate
for each outstanding  LIBOR Rate Loan shall be adjusted  automatically as of the
effective date of any change in the Eurodollar Reserve Percentage.

                  "LIBOR Rate Loans" means the LIBOR Revolving Loans.

                  "LIBOR  Revolving  Loan"  means a  Revolving  Loan  during any
period in which it bears interest based on the LIBOR Rate.

                  "Lien"  means:  (a)  any  interest  in  property  securing  an
obligation  owed  to,  or a claim  by,  a Person  other  than  the  owner of the
property,  whether  such  interest  is  based on the  common  law,  statute,  or
contract, and including a security interest, charge, claim, or lien arising from
a  mortgage,  deed of trust,  encumbrance,  pledge,  hypothecation,  assignment,
deposit arrangement,  agreement,  security agreement,  conditional sale or trust
receipt or a lease,  consignment or bailment for security  purposes;  (b) to the
extent not included under clause (a), any reservation,  exception, encroachment,
easement, right-of-way,  covenant, condition,  restriction, lease or other title
exception or  encumbrance  affecting  property;  and (c) any contingent or other
agreement to provide any of the foregoing.

                  "Loan Account" means the loan account of the Borrowers,  which
account shall be maintained by the Agent.

                  "Loan  Documents"  means this  Agreement,  the Revolving  Loan
Notes, the Final Order,  and any other  agreements,  instruments,  and documents
heretofore,  now or hereafter  evidencing,  securing,  guaranteeing or otherwise
relating to the Obligations or any other aspect of the transactions contemplated
by this Agreement.

                  "Loans" means,  collectively,  all loans and advances provided
for in Article 1.

                  "Majority Lenders" means at any date of determination  Lenders
whose Pro Rata Shares  aggregate more than 50% as such  percentage is determined
under the definition of Pro Rata Share set forth herein.

                  "Margin Stock" means "margin stock" as such term is defined in
Regulation T, U or X of the Federal Reserve Board.

                  "Material  Adverse Effect" means (a) a material adverse change
in, or a material  adverse effect upon, the  operations,  business,  properties,
condition  (financial or otherwise)  of the  Borrowers  taken as a whole;  (b) a
material impairment of the Borrowers'  ability,  taken as a whole, to pay any of
the Loans or any of the other  Obligations in accordance  with the terms of this
Agreement or any other Loan  Document;  (c) a material  adverse  effect upon the
Agent's or any Lender's  rights and remedies  under this  Agreement or any other
Loan Agreement; or (d) a material impairment of the validity, extent or priority
of the  Superpriority  Administrative  Claim of the  Agent  and the  Lenders  in
respect of the Obligations.  For purposes  hereof,  the filing of the Bankruptcy
Cases on the  Filing  Date  and the  existence  of  pre-petition  claims  and of
defaults  under such  pre-petition  claims  shall not be deemed to  constitute a
Material Adverse Effect.

                  "Maximum Inventory Loan Amount" means $300,000,000.
                   -----------------------------

                  "Maximum Revolver Amount" means  $500,000,000,  as such amount
may be reduced from time to time in  accordance  with the  provisions of Section
3.2.

                  "Multi-employer Plan" means a "multi-employer plan" as defined
in Section  4001(a)(3)  of ERISA  which is or was at any time during the current
year or the immediately  preceding six (6) years  contributed to by any Borrower
or any ERISA Affiliate.

                  "Net  Amount of Eligible  Accounts"  means,  at any time,  the
gross amount of Eligible Accounts less sales,  excise or similar taxes, and less
returns,  discounts,  claims,  credits,  allowances,  accrued rebates,  offsets,
deductions, counterclaims, disputes and other defenses of any nature at any time
issued, owing, granted, outstanding, available or claimed.

                  "Non-Ratable  Loan" and "Non-Ratable  Loans" have the meanings
specified in Section 1.2(h).

                  "Notes" means Revolving Loan Notes.
                   -----

                  "Notice of  Borrowing"  has the meaning  specified  in Section
1.2(b).

                  "Notice of Continuation/Conversion"  has the meaning specified
in Section 2.2(b).

                  "Obligations"  means all present and future  loans,  advances,
liabilities,  obligations, covenants, duties, and debts owing by any Borrower to
the Agent and/or any Lender,  arising under or pursuant to this Agreement or any
of the other Loan  Documents,  whether or not  evidenced  by any note,  or other
instrument or document,  whether arising from an extension of credit, opening of
a letter of credit,  acceptance,  loan, guaranty,  indemnification or otherwise,
whether  direct or  indirect,  absolute  or  contingent,  due or to become  due,
primary or secondary,  as principal or guarantor,  and including all  principal,
interest,  charges,  expenses,  fees, attorneys' fees, filing fees and any other
sums  chargeable  to any  Borrower  hereunder  or under  any of the  other  Loan
Documents.   "Obligations"   includes,   without  limitation,   (a)  all  debts,
liabilities, and obligations now or hereafter arising from or in connection with
the  Letters of Credit and (b) all debts,  liabilities  and  obligations  now or
hereafter arising from or in connection with Bank Products.

                  "Other   Subsidiary"  means  any  Subsidiary  of  the  Company
consolidated  for  purposes  of  the  Financial   Statements  other  than  those
Subsidiaries which are Borrowers.

                  "Other Taxes" means any present or future stamp or documentary
taxes or any other  excise or property  taxes,  charges or similar  levies which
arise  from any  payment  made  hereunder  or from the  execution,  delivery  or
registration  of, or otherwise with respect to, this Agreement or any other Loan
Documents.

                  "Participant" means any Person who shall have been granted the
right by any Lender to  participate  in the  financing  provided  by such Lender
under this  Agreement in  accordance  with Section  11.2(e),  and who shall have
entered into a  participation  agreement in form and substance  satisfactory  to
such Lender.

                  "PBGC" means the Pension Benefit  Guaranty  Corporation or any
Governmental Authority succeeding to the functions thereof.

                  "Pending  Revolving  Loans" means,  at any time, the aggregate
principal  amount of all  Revolving  Loans  requested in any Notice of Borrowing
received by the Agent which have not yet been advanced.

                  "Pension  Plan"  means a pension  plan (as  defined in Section
3(2) of  ERISA)  subject  to Title  IV of ERISA  which  any  Borrower  sponsors,
maintains,   or  to  which  it  makes,  is  making,  or  is  obligated  to  make
contributions, or in the case of a Multi-employer Plan has made contributions at
any time during the immediately preceding five (5) plan years.

                  "Permitted  Intercompany Debt" means (a) unsecured Debt of any
Borrower to any other Borrower,  (b) unsecured Debt of any Borrower to any Other
Subsidiary that is  subordinated  to the  Obligations  hereunder in an aggregate
outstanding  principal amount at any time outstanding not to exceed  $25,000,000
for all such  Debt;  (c) Debt of any  Other  Subsidiary  to any  Borrower  in an
aggregate outstanding principal amount at any time not to exceed $50,000,000 for
all such Debt and (d) Debt of any Other Subsidiary to any Other Subsidiary.

                  "Permitted Liens" means, as to any Borrower:
                   ---------------

                  (a)  Liens  for  taxes,  assessments  and  other  governmental
charges not delinquent or statutory  Liens for taxes in an amount (not to exceed
$25,000,000  in the  aggregate for the  Borrowers)  provided that the payment of
such taxes which are claimed to be due and  payable is being  contested  in good
faith and by appropriate proceedings diligently pursued and as to which adequate
financial reserves have been established on the applicable  Borrower's books and
records and a stay of enforcement of any such Lien is in effect;

                  (b)  Liens  consisting  of  deposits  or  pledges  made in the
ordinary  course of  business  in  connection  with,  or to secure  payment  of,
obligations under worker's compensation, unemployment insurance, social security
and other  similar  laws,  or to secure  the  performance  of bids,  tenders  or
contracts (other than for the repayment of Debt) or to secure (or obtain letters
of credit to  secure)  indemnity,  performance  or other  similar  bonds for the
performance of bids, tenders or contracts (other than for the repayment of Debt)
or to secure  statutory  obligations  (other than liens  arising  under ERISA or
Environmental  Liens),  leases,  purchase,  construction  or sales contracts and
similar  obligations  or  surety  or  appeal  bonds,  or  to  secure  indemnity,
performance or other similar bonds;

                  (c) Liens  securing  the  claims or  demands  of  materialmen,
mechanics,  carriers,  warehousemen,  landlords and other like Persons, provided
that if any such Lien arises from the  nonpayment  of such claims or demand when
due, (1) the payment of such claims or demands is being  contested in good faith
and  by  appropriate  proceedings  diligently  pursued  and  adequate  financial
reserves have been  established on the applicable  Borrower's  books and records
and a stay of  enforcement  of any such Lien is in effect and (2) the nonpayment
of such claims or demands  would not  reasonably  be expected to have a Material
Adverse Effect;

                  (d)  Liens   constituting   encumbrances   in  the  nature  of
reservations,  exceptions,  encroachments,  easements,  rights of way, covenants
running  with the land,  and other  similar  title  exceptions  or  encumbrances
affecting any Real Estate; provided that they do not in the aggregate materially
detract from the value of the Real Estate or materially  interfere  with its use
in the ordinary conduct of such Borrower's business;

                  (e)  Liens  that  arise  from  judgments  and  attachments  in
connection with court proceedings  notwithstanding the terms of the Final Order;
provided, that if the amount of indebtedness secured by all such Liens equals or
exceeds  $1,000,000 at any time  outstanding in the aggregate for the Borrowers,
the execution or other  enforcement  of such Liens is not unstayed for more than
30 days and such  Liens  would  not  result  in an Event of  Default;  provided,
further,  that,  after  giving  effect to the  imposition  of such  Liens and to
Reserves  established by the Agent with respect to the  indebtedness  secured by
such Liens, the sum of Borrowing Base  Availability  plus all unrestricted  cash
and  Cash  Equivalents  of the  Borrowers  shall be  equal  to or  greater  than
$150,000,000;

                  (f)      Liens  constituting  a lease or  sublease  granted
by any  Borrower  to  others  in the ordinary course of business;

                  (g)      Liens on any asset  leased by any  Borrower
constituting  the interest of the lessor of such asset or secured by the
interest of the lessor of such asset;

                  (h) Liens created  pursuant to an application or reimbursement
agreement  pertaining to a commercial  letter of credit that  encumbers only the
goods,  or documents of title  covering the goods,  that were sold or shipped in
the transaction for which such letter of credit was issued;

                  (i) Liens in favor of the  United  States of  America,  or any
agency, department or other instrumentality thereof, to secure progress, advance
or other payments pursuant to any contract or provision of any statute;

                  (j) Liens on any asset  constituting the unsecured interest of
the holder of a purchase  option on such property so long as the  disposition of
such property pursuant to such purchase option would not violate Section 7.8;

                  (k)  Liens  existing  on any asset  (other  than  Accounts  or
Inventory or proceeds thereof) prior to the acquisition  thereof by any Borrower
but only if such Lien was not  created in  contemplation  thereof and so long as
the obligation  secured by such Lien is not in default and such Lien is and will
remain  confined  to the asset  subject to it at the time such asset is acquired
and to fixed improvements  thereafter erected on such asset if constituting real
property;

                  (l) Liens constituting a renewal,  extension or replacement of
a Lien  constituting a Lien permitted  under clause 7.17(b) or clause (k) above,
but only, in the case of each such renewal,  extension or  replacement  Lien, to
the extent that the principal  amount of indebtedness  secured by such Lien does
not exceed the principal  amount of such  indebtedness so secured at the time of
the  extension,  renewal or  replacement,  and that such  renewal,  extension or
replacement  Lien is limited to all or part of the asset that was subject to the
Lien extended,  renewed or replaced and to fixed improvements then or thereafter
erected on any such asset constituting real property;

                  (m)      Liens on the  Jackson  Real  Estate and the Jackson
Equipment  arising  pursuant to the Jackson Transaction; and

                  (n) Any  other  Lien so long  as the  amount  of  indebtedness
secured by such Lien and all other Liens not otherwise  permitted hereunder does
not  exceed  $20,000,000  at any  time  outstanding  in the  aggregate  for  the
Borrowers.

                  "Person"   means   any   individual,    sole   proprietorship,
partnership,  limited liability company,  joint venture,  trust,  unincorporated
organization,  association,  corporation,  Governmental  Authority, or any other
entity.

                  "Plan"  means an employee  benefit plan (as defined in Section
3(3) of ERISA) which any Borrower sponsors or maintains or to which any Borrower
makes, is making, or is obligated to make contributions and includes any Pension
Plan.

                  "Projections" means the financial projections dated October 2,
2000 of the  Company  and its  consolidated  Subsidiaries  for the  period  from
October 1, 2000 through  December  31, 2002 and  delivered to the Agent prior to
the Closing Date.

                  "Proprietary Rights" means, with respect to any Person, all of
such Person's now owned and hereafter arising or acquired: licenses, franchises,
permits, patents, patent rights, copyrights,  works which are the subject matter
of copyrights,  trademarks,  service marks, trade names,  trade styles,  patent,
trademark and service mark applications,  and all licenses and rights related to
any of the  foregoing,  and all other  rights  under any of the  foregoing,  all
extensions,     renewals,    reissues,     divisions,     continuations,     and
continuations-in-part  of any of the foregoing,  and all rights to sue for past,
present and future infringement of any of the foregoing.

                  "Pro Rata Share" means,  with respect to a Lender,  a fraction
(expressed  as a  percentage),  the  numerator  of which is the  amount  of such
Lender's  Commitment  and the  denominator of which is the sum of the amounts of
all of  the  Lenders'  Commitments,  or if no  Commitments  are  outstanding,  a
fraction  (expressed as a  percentage),  the numerator of which is the amount of
Obligations  owed to such Lender and the  denominator  of which is the aggregate
amount of the Obligations  owed to the Lenders,  in each case giving effect to a
Lender's participation in Non-Ratable Loans and Agent Advances.

                  "Real Estate" means,  with respect to any Person,  all of such
Person's now or hereafter  owned or leased estates in real property,  including,
without limitation, all fees, leaseholds and future interests, together with all
of such Person's now or hereafter owned or leased  interests in the improvements
thereon, the fixtures attached thereto and the easements appurtenant thereto.

                  "Release" means a release, spill, emission,  leaking, pumping,
injection, deposit, disposal,  discharge,  dispersal, leaching or migration of a
Contaminant  into the indoor or outdoor  environment  or into or out of any Real
Estate or other property,  including the movement of Contaminants  through or in
the air, soil, surface water, groundwater or Real Estate or other property.

                  "Reportable  Event"  means,  any of the  events  set  forth in
Section  4043(c)  of ERISA or the  regulations  thereunder,  other than any such
event for which the 30-day  notice  requirement  under  ERISA has been waived in
regulations issued by the PBGC.

                  "Required  Lenders"  means at any time Lenders  whose Pro Rata
Shares  aggregate more than 66-2/3% as such  percentage is determined  under the
definition of Pro Rata Share set forth herein.

                  "Requirement  of  Law"  means,  as  to  any  Person,  any  law
(statutory  or  common),  treaty,  rule or  regulation  or  determination  of an
arbitrator or of a Governmental Authority, in each case applicable to or binding
upon the  Person or any of its  property  or to which  the  Person or any of its
property is subject.

                  "Reserves"  means  reserves  that  limit the  availability  of
credit hereunder, consisting of reserves against Availability, Eligible Accounts
or  Eligible  Inventory,  established  by Agent from time to time in the Agent's
reasonable  credit  judgment.  Without limiting the generality of the foregoing,
the following  Reserves  shall be deemed to be a reasonable  exercise of Agent's
credit judgment:  (a) Bank Product  Reserves,  (b) reserves for indebtedness and
other obligations secured by Liens against Accounts or Inventory of any Borrower
(except to the extent such  indebtedness  and other  obligations  are secured by
Letters of Credit),  (d) Inventory  shrinkage,  (e) the Carve-Out (less any paid
portion thereof) plus any accrued and unpaid  professional  fees incurred by the
Borrowers  and  statutory  committees  prior to a Carve-Out  Event,  (g) customs
charges, and (h) dilution.

                  "Responsible  Officer" means any of the following  officers of
the Borrower  Representative:  the chief executive officer,  the president,  the
chief financial officer, the treasurer or the assistant  treasurer,  or, in each
case,   any  other  officer   having   substantially   the  same  authority  and
responsibility.

                  "Restricted   Investment"  means,  as  to  any  Borrower,  any
acquisition  of property by such Person in exchange for cash or other  property,
whether in the form of an acquisition of stock,  debt, or other  indebtedness or
obligation,  or the purchase or  acquisition of any other  property,  or a loan,
advance, capital contribution, or subscription, including in connection with the
organization,  creation or acquisition of any Subsidiary (each an "Investment"),
except the following:  (a) acquisitions of Equipment and other capital assets in
the ordinary course of business of such Person; (b) acquisitions of Inventory in
the ordinary  course of business of such  Person;  (c)  acquisitions  of current
assets  acquired  in the  ordinary  course  of  business  of  such  Person;  (d)
Investments in Cash  Equivalents;  (e)  Investments by any Borrower in any other
Borrower,  (f)  extensions  of trade  credit and  prepaid  expenses  made in the
ordinary  course of  business,  (g) (i) loans to officers of any Borrower in the
ordinary  course of  business,  (ii)  loans and  advances  to  employees  of any
Borrower  for travel,  entertainment  and  relocation  expenses in the  ordinary
course of business and (iii) loans by any  Borrower to  employees in  connection
with  management  incentive  plans,  provided  that  the  aggregate  outstanding
principal amount of all such loans and advances made pursuant to this clause (g)
shall not exceed  $5,000,000 at any time;  (h)  Investments  outstanding  on the
Closing Date and listed on Schedule A-1, (i) Investments not otherwise permitted
hereunder by any Borrower in any Other  Subsidiary,  provided  that after giving
effect to such  Investments,  the aggregate then outstanding  amount of all such
Investments  made  pursuant to this clause (i)  subsequent  to the Closing  Date
shall not exceed $50,000,000, provided, further, that the conversion of any Debt
owed  to any  Borrower  by any  Other  Subsidiary  into  equity  of  such  Other
Subsidiary  shall  not  constitute  an  additional   Investment  in  such  Other
Subsidiary  by any  Borrower  for  purposes of the  limitation  contained in the
immediately  proceeding  provision,  (j) Investments received in connection with
the collection of Accounts in the ordinary  course of business,  (k) Investments
received as consideration in connection with any asset sale or other disposition
of assets  permitted  hereunder,  (l) loans and  advances  to  suppliers  in the
ordinary  course of business  consistent with past practice but in any event not
in excess of an  outstanding  principal  amount of  $20,000,000 at any time, (m)
Investments made by the Fibreboard Settlement Trust in accordance with the terms
of  the  Fibreboard  Settlement  Trust,  (n)  other  Investments  not  otherwise
permitted  hereunder  constituting  proceeds of sales or other  dispositions  of
assets permitted under clauses (ii) and (x) of Section 7.8, provided that, after
giving effect thereto,  the aggregate amount of all such Investments made at any
time after the  Closing  Date by all  Borrowers  under this clause (n) shall not
exceed $60,000,000 and (o) other Investments not otherwise  permitted  hereunder
made by any Borrower,  provided that, after giving effect thereto, the aggregate
amount of all such  Investments  made at any time after the Closing  Date by all
Borrowers under this clause (o) shall not exceed $40,000,000.

                  "Revolving Loans" has the meaning specified in Section 1.2 and
includes each Non-Ratable Loan.

                  "Revolving  Loan Note" and  "Revolving  Loan  Notes"  have the
meanings specified in Section 1.2(a)(ii).

                  "Settlement" and "Settlement Date" have the meanings specified
in Section 12.15(a)(ii).

                  "Stated Termination Date" means November 15, 2002.
                   -----------------------

                  "Subsidiary" of a Person means any  corporation,  association,
partnership,  limited liability company,  joint venture or other business entity
of which  more than fifty  percent  (50%) of the  voting  stock or other  equity
interests  (in the  case of  Persons  other  than  corporations),  is  owned  or
controlled  directly  or  indirectly  by  the  Person,  or one  or  more  of the
Subsidiaries  of the  Person,  or a  combination  thereof.  Unless  the  context
otherwise  clearly  requires,  references  herein to a  "Subsidiary"  refer to a
Subsidiary of the Company.

                  "Superpriority Administrative Claim" has the meaning specified
 in Section 7.25


                  "Supporting  Obligations" means all supporting  obligations as
such term is defined in the UCC.

                  "Syndication Fee" has the meaning specified in Section 2.4.

                  "Taxes"  means any and all  present or future  taxes,  levies,
imposts, deductions,  charges or withholdings,  and all liabilities with respect
thereto,  excluding,  in the  case of each  Lender  and the  Agent,  such  taxes
(including income,  capital or franchise taxes) as are imposed on or measured by
the Agent's or each Lender's net income or capital in any jurisdiction  (whether
federal,  state,  local or  foreign  and  including  any  political  subdivision
thereof)  under the laws of which such Lender or the Agent,  as the case may be,
is  organized  or  maintains  a  lending  office,  branch,  affiliate  or  other
connection  (other than such  connection  arising  from the Agent or such Lender
having  executed,  delivered or reformed  its  obligations  or received  payment
under, or taken any action to enforce, this Agreement).

                  "Termination  Date"  means  the  earliest  to occur of (i) the
Stated  Termination  Date, (ii) the date the Total Facility is terminated either
by the Borrower  pursuant to Section 3.2 or by the Required  Lenders pursuant to
Section 9.2, and (iii) the date this  Agreement is otherwise  terminated for any
reason whatsoever pursuant to the terms of this Agreement.

                  "Total Facility" has the meaning specified in Section 1.1.

                  "UCC" means the  Uniform  Commercial  Code,  as in effect from
time to time,  of the State of  Illinois or of any other state the laws of which
are required as a result  thereof to be applied in connection  with the issue of
perfection of security interests.

                  "Unfunded  Pension  Liability"  means  the  excess of a Plan's
benefit  liabilities under Section 4001(a)(16) of ERISA, over the current market
value of that Plan's assets,  determined in accordance with the assumptions used
for  funding  the Pension  Plan  pursuant to Section  412(c) of the Code for the
applicable plan year plus any contributions for the applicable plan year.

                  "Unused Letter of Credit Subfacility" means an amount equal to
$300,000,000  minus  the  sum  of  (a)  the  aggregate  undrawn  amount  of  all
outstanding  Letters of Credit  plus,  without  duplication,  (b) the  aggregate
unpaid reimbursement obligations with respect to all Letters of Credit.

                  "Unused Line Fee" has the meaning specified in Section 2.5.

                  Accounting  Terms.  Any accounting  term used in the Agreement
shall  have,  unless  otherwise   specifically   provided  herein,  the  meaning
customarily  given in  accordance  with  GAAP,  and all  financial  computations
hereunder shall be computed,  unless otherwise  specifically provided herein, in
accordance  with GAAP as  consistently  applied  and using the same  method  for
inventory valuation as used in the preparation of the Financial  Statements.  If
any change in generally accepted accounting principles subsequent to the date of
this Agreement is material to either any Borrower or the Lenders for the purpose
of determining  the Borrowers'  compliance  with any covenant  contained in this
Agreement,  then (A) such change shall not,  without the consent of the Required
Lenders,  if such change makes such covenant less  restrictive,  or the Borrower
Representative,  if  such  change  makes  such  covenant  more  restrictive,  be
effective for the  calculation  of such  covenant  unless and until an amendment
pursuant  to clause (B) below  with  respect  to such  change and such  covenant
becomes effective,  and (B) the Borrowers and the Agent and the Lenders agree to
enter into  negotiations,  at the request of the Borrowers or the Representative
Lenders,  in order to amend such covenant so as equitably to reflect such change
with the desired  result  that the  criteria  for  evaluating  the  consolidated
financial  condition of the Company and its consolidated  Subsidiaries  shall be
the same after such change as before such change.

                  Interpretive  Provisions.  (a) The  meanings  of  defined
terms are  equally  applicable  to the singular and plural forms of the defined
terms.

                  (b) The words  "hereof,"  "herein,"  "hereunder"  and  similar
words refer to the Agreement as a whole and not to any  particular  provision of
this Agreement; and Subsection,  Section, Schedule and Exhibit references are to
this Agreement unless otherwise specified.

                  (c)      (i)      The term "documents" includes any and all
instruments,  documents,  agreements, certificates, indentures, notices and
other writings, however evidenced.

                           (ii)     The term "including" is not limiting and
means "including without limitation."

                           (iii) In the  computation  of  periods of time from a
         specified date to a later  specified  date, the word "from" means "from
         and including," the words "to" and "until" each mean "to but excluding"
         and the word "through" means "to and including."

                           (iv)     The word "or" is not exclusive.

                  (d) Unless otherwise expressly provided herein, (i) references
to agreements (including this Agreement) and other contractual instruments shall
be deemed to include all subsequent amendments and other modifications  thereto,
but  only  to the  extent  such  amendments  and  other  modifications  are  not
prohibited by the terms of any Loan Document, and (ii) references to any statute
or regulation  are to be construed as including  all  statutory  and  regulatory
provisions consolidating, amending, replacing, supplementing or interpreting the
statute or regulation.

                  (e) The captions and headings of the  Agreement and other Loan
Documents  are for  convenience  of  reference  only and  shall not  affect  the
interpretation of this Agreement.

                  (f) The  Agreement  and other Loan  Documents  may use several
different  limitations,  tests or  measurements  to regulate the same or similar
matters.  All such limitations,  tests and measurements are cumulative and shall
each be performed in accordance with their terms.

                  (g) For  purposes  of  Section  9.1,  a breach of a  financial
covenant  contained in Sections  7.21 shall be deemed to have occurred as of any
date  of  determination  thereof  by  the  Agent  or as of the  last  day of any
specified  measuring  period,   regardless  of  when  the  Financial  Statements
reflecting such breach are delivered to the Agent.

                  (h) The Agreement and the other Loan  Documents are the result
of  negotiations  among and have been  reviewed  by counsel  to the  Agent,  the
Borrowers  and  the  other  parties,  and  are  the  products  of  all  parties.
Accordingly, they shall not be construed against the Lenders or the Agent merely
because of the Agent's or Lenders' involvement in their preparation.

                  (i)  Each   reference  to  any  statute   shall   include  all
regulations  promulgated  thereunder  and shall mean such statute as amended and
all statutes intended to replace or supersede the specified statute.



<PAGE>




                                                     EXHIBIT A

                                            FORM OF REVOLVING LOAN NOTE



<PAGE>


                                                     EXHIBIT B

                                        FORM OF BORROWING BASE CERTIFICATE



<PAGE>




                                                     EXHIBIT C

                                               FINANCIAL STATEMENTS



<PAGE>

<TABLE>
<S>                                                                                   <C>

                                                     EXHIBIT D

                                                NOTICE OF BORROWING


                                                                                        Date:  ______________, 200_


To:      Bank of America,  N.A. as Agent for the Lenders  who are  parties to the  Post-Petition  Credit  Agreement
         dated as of December __, 2000 (as extended,  renewed,  amended or restated from time to time, the "Credit
         Agreement")  among Owens Corning and certain of its Subsidiaries  thereto,  as Borrowers,  certain Lenders
         which are signatories thereto and Bank of America, N.A., as Agent

Ladies and Gentlemen:

                  The     undersigned,     Owens    Corning    (the    "Borrower
Representative"),  refers to the Credit  Agreement,  the terms  defined  therein
being used herein as therein defined, and hereby gives you notice irrevocably of
the Borrowing specified below:

                  1.       The Business Day of the proposed Borrowing is                        , 200  .
                                                                         -----------------------     --

                  2.       The aggregate amount of the proposed Borrowing is $                     .
                                                                              ---------------------

                  3.       The  Borrowing is to be  comprised  of  $            of Base Rate and  $              of
                                                                    ------------                   --------------
                           LIBOR Rate Loans.

                  4.       The duration of the Interest  Period for the LIBOR Rate Loans,  if any,  included in the
                           Borrowing shall be _____ months.

                  The undersigned hereby certifies that the following statements
are  true on the  date  hereof,  and  will be true on the  date of the  proposed
Borrowing,  before and after giving effect thereto and to the application of the
proceeds therefrom:

                  (a)  The  representations  and  warranties  of  the  Borrowers
contained in the Credit  Agreement  and the other Loan  Documents are correct in
all  material  respects  on and as of such date as though made on and as of such
date,  other  than  any such  representation  or  warranty  which  relates  to a
specified  prior date and except to the  extent the Agent and the  Lenders  have
been notified in writing by the Borrower  Representative that any representation
or warranty is not correct and the Required  Lenders have  explicitly  waived in
writing compliance with such representation or warranty;

                  (b)      No Default or Event of Default has  occurred  and is  continuing,  or would  result from
such proposed Borrowing; and

                  (c) The  proposed  Borrowing  will  not  cause  the  aggregate
principal  amount of all outstanding  Revolving Loans plus the aggregate  amount
available for drawing  under all  outstanding  Letters of Credit,  to exceed the
Borrowing  Base,  as reflected  in the most recent  Borrowing  Base  Certificate
delivered to the Agent  pursuant to the Credit  Agreement (as such amount may be
reduced  by  Reserves  established  by the  Agent  following  the  date  of such
Borrowing Base Certificate), or the combined Commitments of the Lenders.

                                                              OWENS CORNING



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

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


</TABLE>

<PAGE>




                                                     EXHIBIT E

                                         NOTICE OF CONTINUATION/CONVERSION
<TABLE>
<S>                                                                                    <C>
                                                                                      Date:                  , 200_
                                                                                             ----------------


To:      Bank of  America,  N.A.  as Agent  for the  Lenders  to the  Post-Petition  Credit  Agreement  dated as of
         December __, 2000 (as extended,  renewed,  amended or restated from time to time, the "Credit  Agreement")
                                                                                                -----------------
         among Owens Corning and certain of its Subsidiaries which are signatories  thereto, as Borrowers,  certain
         Lenders which are signatories thereto and Bank of America, N.A., as Agent

Ladies and Gentlemen:

                  The     undersigned,     Owens    Corning    (the    "Borrower
Representative"),  refers to the Credit  Agreement,  the terms  defined  therein
being used herein as therein defined, and hereby gives you notice irrevocably of
the [conversion] [continuation] of the Loans specified herein, that:

                  1.       The Continuation/Conversion Date is             , 200 .
                                                               ------------     -

                  2.       The aggregate amount of the Loans to be [converted] [continued] is $              .

                  3.       The Loans are to be [converted into] [continued as] [LIBOR Rate] [Base Rate] Loans.

                  4.       The  duration  of  the  Interest  Period  for  the  LIBOR  Rate  Loans  included  in the
                           [conversion] [continuation] shall be       months.

                  The undersigned hereby certifies that the following statements
are   true  on  the   date   hereof,   and   will   be  true  on  the   proposed
Continuation/Conversion  Date, before and after giving effect thereto and to the
application of the proceeds therefrom:

                  (a)  The  representations  and  warranties  of  the  Borrowers
         contained  in the Credit  Agreement  and the other Loan  Documents  are
         correct in all material  respects on and as of such date as though made
         on and as of such date, other than any such  representation or warranty
         which  relates to a  specified  prior date and except to the extent the
         Agent and the Lenders  have been  notified  in writing by the  Borrower
         Representative  that any  representation or warranty is not correct and
         the Required Lenders have explicitly waived in writing  compliance with
         such representation or warranty;

                  (b)      Default or Event of Default has  occurred and is  continuing,  or would result from such
         proposed [conversion] [continuation]; and



<PAGE>


                  (c) The  proposed  conversion-continuation  will not cause the
aggregate principal amount of all outstanding Revolving Loans plus the aggregate
amount  available for drawing under all outstanding  Letters of Credit to exceed
the Borrowing Base, as reflected in the most recent  Borrowing Base  Certificate
delivered to the Agent  pursuant to the Credit  Agreement (as such amount may be
reduced  by  Reserves  established  by the  Agent  following  the  date  of such
Borrowing Base Certificate), or the combined Commitments of the Lenders.

                                                              OWENS CORNING



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

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


</TABLE>

<PAGE>




                                    EXHIBIT H

                  [FORM OF] ASSIGNMENT AND ACCEPTANCE AGREEMENT

                  This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this "Assignment and
Acceptance")   dated   as  of   ____________________,   200_  is  made   between
______________________________  (the "Assignor") and  __________________________
(the "Assignee").

                                    RECITALS

                  WHEREAS,  the Assignor is party to that certain  Post-Petition
Credit Agreement dated as of October __, 2000 (as amended, amended and restated,
modified,  supplemented or renewed, the "Credit Agreement") among Owens Corning,
a Delaware corporation (the "Company"),  and certain Subsidiaries of the Company
which are signatory  thereto  (together with the Company,  each a "Borrower" and
collectively "Borrowers"),  the several financial institutions from time to time
party thereto (including the Assignor,  the "Lenders"),  and Bank of America, N.
A., as agent for the  Lenders  (the  "Agent").  Any terms  defined in the Credit
Agreement and not defined in this  Assignment  and Acceptance are used herein as
defined in the Credit Agreement;

                  WHEREAS, as provided under the Credit Agreement,  the Assignor
has  committed to making Loans (the  "Committed  Loans") to the  Borrowers in an
aggregate amount not to exceed $__________ (the "Commitment");

                  WHEREAS,  the Assignor has made Committed Loans in the
aggregate  principal amount of $__________ to the Borrowers;

                  WHEREAS, [the Assignor has acquired a participation in its pro
rata share of the Lenders'  liabilities  under Letters of Credit in an aggregate
principal amount of $____________ (the "L/C Obligations")] [no Letters of Credit
are outstanding under the Credit Agreement]; and

                  WHEREAS,  the Assignor  wishes to assign to the Assignee [part
of the] [all] rights and obligations of the Assignor under the Credit  Agreement
in respect of its Commitment,  together with a corresponding  portion of each of
its  outstanding  Committed  Loans and L/C  Obligations,  in an amount  equal to
$__________  (the "Assigned  Amount") on the terms and subject to the conditions
set forth herein and the Assignee wishes to accept assignment of such rights and
to assume such  obligations  from the Assignor on such terms and subject to such
conditions;

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

         1.       Assignment and Acceptance.
                  -------------------------

                  (a) Subject to the terms and conditions of this Assignment and
Acceptance,  (i)  the  Assignor  hereby  sells,  transfers  and  assigns  to the
Assignee,  and (ii) the Assignee hereby  purchases,  assumes and undertakes from
the Assignor, without recourse and without representation or warranty (except as
provided in this  Assignment and  Acceptance)  __% (the  "Assignee's  Percentage
Share") of (A) the  Commitment,  the Committed  Loans and the L/C Obligations of
the Assignor and (B) all related rights, benefits, obligations,  liabilities and
indemnities  of the Assignor under and in connection  with the Credit  Agreement
and the Loan Documents.

                  (b) With effect on and after the Effective Date (as defined in
Section 5 hereof),  the Assignee  shall be a party to the Credit  Agreement  and
succeed to all of the rights and be obligated to perform all of the  obligations
of a Lender under the Credit  Agreement,  including the requirements  concerning
confidentiality  and the payment of  indemnification,  with a  Commitment  in an
amount equal to the Assigned Amount. The Assignee agrees that it will perform in
accordance  with their  terms all of the  obligations  which by the terms of the
Credit  Agreement  are  required to be  performed  by it as a Lender.  It is the
intent of the parties  hereto that the Commitment of the Assignor  shall,  as of
the Effective Date, be reduced by an amount equal to the Assigned Amount and the
Assignor shall relinquish its rights and be released from its obligations  under
the Credit  Agreement  to the extent such  obligations  have been assumed by the
Assignee;  provided, however, the Assignor shall not relinquish its rights under
Sections __ and __ of the Credit  Agreement to the extent such rights  relate to
the time prior to the Effective Date.

                  (c)      After  giving  effect  to  the  assignment  and
assumption  set  forth  herein,  on the Effective Date the Assignee's Commitment
will be $__________.

                  (d)      After  giving  effect  to  the  assignment  and
assumption  set  forth  herein,  on the Effective Date the Assignor's Commitment
will be $__________.

         2.       Payments.
                  --------

                  (a) As  consideration  for the sale,  assignment  and transfer
contemplated in Section 1 hereof,  the Assignee shall pay to the Assignor on the
Effective Date in immediately  available  funds an amount equal to  $__________,
representing  the  Assignee's  Pro Rata  Share of the  principal  amount  of all
Committed Loans.

                  (b)      The  Assignee  further  agrees  to pay to  the  Agent
a  processing  fee in the  amount specified in Section 11.2(a) of the Credit
Agreement.

         3.       Reallocation of Payments.
                  ------------------------

                  Any interest, fees and other payments accrued to the Effective
Date with respect to the  Commitment,  and Committed  Loans and L/C  Obligations
shall be for the account of the Assignor. Any interest,  fees and other payments
accrued on and after the  Effective  Date with  respect to the  Assigned  Amount
shall be for the account of the Assignee.  Each of the Assignor and the Assignee
agrees  that it will hold in trust for the other  party any  interest,  fees and
other amounts which it may receive to which the other party is entitled pursuant
to the  preceding  sentence and pay to the other party any such amounts which it
may receive promptly upon receipt.

         4.       Independent Credit Decision.
                  ---------------------------

                  The Assignee (a)  acknowledges  that it has received a copy of
the Credit  Agreement  and the  Schedules  and Exhibits  thereto,  together with
copies  of  the  most  recent  financial  statements  of  the  Company  and  its
Subsidiaries,  and  such  other  documents  and  information  as it  has  deemed
appropriate to make its own credit and legal analysis and decision to enter into
this Assignment and Acceptance;  and (b) agrees that it will,  independently and
without  reliance upon the Assignor,  the Agent or any other Lender and based on
such  documents  and  information  as it shall  deem  appropriate  at the  time,
continue  to make its own  credit  and legal  decisions  in taking or not taking
action under the Credit Agreement.

         5.       Effective Date; Notices.
                  -----------------------

                  (a) As between the Assignor and the  Assignee,  the  effective
date  for  this  Assignment  and  Acceptance  shall  be  __________,  200_  (the
"Effective Date");  provided that the following  conditions  precedent have been
satisfied on or before the Effective Date:

                           (i)      this Assignment and Acceptance  shall be
executed and delivered by the Assignor and the Assignee;

                           [(ii)  the  consent  of the Agent  [and the  Borrower
         Representative]  required for an effective  assignment  of the Assigned
         Amount by the  Assignor to the Assignee  shall have been duly  obtained
         and shall be in full force and effect as of the Effective Date;]

                           (iii)    the Assignee  shall pay to the  Assignor all
amounts due to the Assignor  under  this Assignment and Acceptance;

                           [(iv)    the Assignee shall have complied with
Section 11.2 of the Credit  Agreement (if applicable);]

                           (v)      the processing fee referred to in  Section
2(b)  hereof and in Section  11.2(a) of the Credit Agreement shall have been
paid to the Agent; and

                  (b) Promptly  following the execution of this  Assignment  and
Acceptance,  the  Assignor  shall  deliver  to the  Borrower  and the  Agent for
acknowledgment  by the Agent [and the  Borrower],  a Notice of Assignment in the
form attached hereto as Schedule 1.

         6.       [Agent.  [INCLUDE ONLY IF ASSIGNOR IS AGENT]
                   -----

                  (a) The Assignee  hereby  appoints and authorizes the Assignor
to take such action as agent on its behalf and to exercise such powers under the
Credit  Agreement as are  delegated to the Agent by the Lenders  pursuant to the
terms of the Credit Agreement.

                  (b) The Assignee shall assume no duties or obligations held by
the Assignor in its capacity as Agent under the Credit Agreement.]

         7.       Withholding Tax.
                  ---------------

                  The Assignee (a)  represents  and warrants to the Lender,  the
Agent and the Borrowers  that under  applicable  law and treaties no tax will be
required to be withheld by the Lender with respect to any payments to be made to
the Assignee hereunder, (b) agrees to furnish (if it is organized under the laws
of any  jurisdiction  other than the United States or any State  thereof) to the
Agent  and the  Borrowers  prior to the  time  that the  Agent or  Borrowers  is
required to make any payment of principal, interest or fees hereunder, duplicate
executed  originals of either U.S.  Internal Revenue Service Form W-8ECI or U.S.
Internal Revenue Service Form W-8BEN (wherein the Assignee claims entitlement to
the benefits of a tax treaty that  provides for a complete  exemption  from U.S.
federal income withholding tax on all payments  hereunder) and agrees to provide
new Forms W-8ECI or W-8BEN upon the expiration of any previously  delivered form
or comparable  statements in accordance with applicable U.S. law and regulations
and  amendments  thereto,  duly executed and completed by the Assignee,  and (c)
agrees to comply with all applicable  U.S. laws and  regulations  with regard to
such withholding tax exemption.

         8.       Representations and Warranties.
                  ------------------------------

                  (a) The Assignor  represents  and warrants  that (i) it is the
legal and  beneficial  owner of the interest  being assigned by it hereunder and
that such interest is free and clear of any Lien or other adverse claim; (ii) it
is duly  organized and existing and it has the full power and authority to take,
and has taken,  all action  necessary to execute and deliver this Assignment and
Acceptance  and any other  documents  required  or  permitted  to be executed or
delivered by it in connection with this Assignment and Acceptance and to fulfill
its obligations hereunder;  (iii) no notices to, or consents,  authorizations or
approvals of, any Person are required (other than any already given or obtained)
for  its  due  execution,  delivery  and  performance  of  this  Assignment  and
Acceptance, and apart from any agreements or undertakings or filings required by
the Credit  Agreement,  no further  action by, or notice to, or filing with, any
Person is required of it for such execution,  delivery or performance;  and (iv)
this  Assignment  and  Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignor, enforceable
against  the  Assignor  in  accordance  with the terms  hereof,  subject,  as to
enforcement,  to bankruptcy,  insolvency,  moratorium,  reorganization and other
laws of general  application  relating to or affecting  creditors' rights and to
general equitable principles.

                  (b) The  Assignor  makes no  representation  or  warranty  and
assumes  no  responsibility  with  respect  to  any  statements,  warranties  or
representations  made in or in  connection  with  the  Credit  Agreement  or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement or any other instrument or document  furnished  pursuant
thereto.  The Assignor makes no  representation  or warranty in connection with,
and assumes no responsibility with respect to, the solvency, financial condition
or  statements  of  the  Borrowers,  or the  performance  or  observance  by the
Borrowers,  of any of its respective  obligations  under the Credit Agreement or
any other instrument or document furnished in connection therewith.

                  (c) The Assignee  represents  and warrants that (i) it is duly
organized  and  existing and it has full power and  authority  to take,  and has
taken,  all  action  necessary  to  execute  and  deliver  this  Assignment  and
Acceptance  and any other  documents  required  or  permitted  to be executed or
delivered  by it in  connection  with this  Assignment  and  Acceptance,  and to
fulfill  its   obligations   hereunder;   (ii)  no  notices  to,  or   consents,
authorizations  or approvals of, any Person are required (other than any already
given or  obtained)  for its due  execution,  delivery and  performance  of this
Assignment  and  Acceptance;  and apart from any agreements or  undertakings  or
filings required by the Credit Agreement, no further action by, or notice to, or
filing  with,  any Person is  required  of it for such  execution,  delivery  or
performance;  (iii) this  Assignment  and  Acceptance has been duly executed and
delivered by it and constitutes the legal,  valid and binding  obligation of the
Assignee,  enforceable against the Assignee in accordance with the terms hereof,
subject,   as   to   enforcement,   to   bankruptcy,   insolvency,   moratorium,
reorganization  and other laws of general  application  relating to or affecting
creditors'  rights  and to  general  equitable  principles;  [and  (iv) it is an
Eligible Assignee.]

         9.       Further Assurances.
                  ------------------

                  The Assignor and the Assignee each hereby agree to execute and
deliver such other instruments,  and take such other action, as either party may
reasonably  request in connection  with the  transactions  contemplated  by this
Assignment  and  Acceptance,  including  the  delivery  of any  notices or other
documents or instruments to the Borrowers or the Agent, which may be required in
connection with the assignment and assumption contemplated hereby.

         10.      Miscellaneous.
                  -------------

                  (a)  Any   amendment  or  waiver  of  any  provision  of  this
Assignment and Acceptance  shall be in writing and signed by the parties hereto.
No failure or delay by either party  hereto in  exercising  any right,  power or
privilege  hereunder  shall  operate as a waiver  thereof  and any waiver of any
breach of the  provisions of this  Assignment  and  Acceptance  shall be without
prejudice to any rights with respect to any other or further breach thereof.

                  (b)      All payments made hereunder shall be made without any
set-off or counterclaim.

                  (c) The Assignor and the Assignee shall each pay its own costs
and expenses incurred in connection with the negotiation, preparation, execution
and performance of this Assignment and Acceptance.

                  (d) This  Assignment  and  Acceptance  may be  executed in any
number of  counterparts  and all of such  counterparts  taken  together shall be
deemed to constitute one and the same instrument.

                  (e) THIS  ASSIGNMENT AND  ACCEPTANCE  SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF ILLINOIS.  The Assignor and
the Assignee each irrevocably  submits to the non-exclusive  jurisdiction of any
State or  Federal  court  sitting  in [ ] over any suit,  action  or  proceeding
arising out of or relating to this  Assignment and  Acceptance  and  irrevocably
agrees that all claims in respect of such action or proceeding  may be heard and
determined in such [ ] State or Federal court. Each party to this Assignment and
Acceptance hereby  irrevocably  waives, to the fullest extent it may effectively
do so, the defense of an inconvenient forum to the maintenance of such action or
proceeding.

                  (f) THE  ASSIGNOR  AND THE  ASSIGNEE  EACH  HEREBY  KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY  WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY  LITIGATION  BASED  HEREON,  OR ARISING OUT OF,  UNDER,  OR IN
CONNECTION  WITH THIS  ASSIGNMENT  AND  ACCEPTANCE,  THE CREDIT  AGREEMENT,  ANY
RELATED DOCUMENTS AND AGREEMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING, OR
STATEMENTS (WHETHER ORAL OR WRITTEN).

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

                                                       [ASSIGNOR]


                                                        By:
                                                        Title:
                                                        Address:


                                                        [ASSIGNEE]


                                                        By:
                                                        Title:
                                                        Address:



<PAGE>



                                   SCHEDULE 1
                                       to
                            ASSIGNMENT AND ACCEPTANCE


                       NOTICE OF ASSIGNMENT AND ACCEPTANCE


                                                         _______________, 200_
Bank of America, N.A.
231 South LaSalle Street
Chicago, Illinois 60697
Attn:
       -------------------------------

Re:  [Name and Address of Borrower]

Ladies and Gentlemen:

                  We refer to the Credit  Agreement dated as of _________,  200_
(as amended, amended and restated,  modified,  supplemented or renewed from time
to time the "Credit Agreement") among  ______________________  (the "Borrower"),
the Lenders  referred  to therein  and Bank of America,  N. A., as agent for the
Lenders (the "Agent").  Terms defined in the Credit Agreement are used herein as
therein defined.

                  1. We hereby give you notice of, and request  your consent to,
the assignment by  __________________  (the "Assignor") to _______________  (the
"Assignee") of _____% of the right, title and interest of the Assignor in and to
the Credit Agreement (including the right, title and interest of the Assignor in
and to the  Commitments  of the  Assignor,  all  outstanding  Loans  made by the
Assignor and the Assignor's  participation  in the Letters of Credit pursuant to
the Assignment and Acceptance  Agreement  attached  hereto (the  "Assignment and
Acceptance").  We understand and agree that the Assignor's  Commitment,  as of ,
200 , is $  ___________,  the  aggregate  amount  of its  outstanding  Loans  is
$_____________, and its participation in L/C Obligations is $_____________.

                  2. The Assignee agrees that, upon receiving the consent of the
Agent and, if applicable,  the Borrower to such assignment, the Assignee will be
bound by the terms of the Credit Agreement as fully and to the same extent as if
the Assignee  were the Lender  originally  holding  such  interest in the Credit
Agreement.

                  3.       The following administrative details apply to the
Assignee:

                           (A)      Notice Address:

                                    Assignee name:
                                                    ----------------------------
                                    Address:
                                              ----------------------------------

                                    Attention:
                                              ----------------------------------
                                    Telephone:  (___)
                                                      ------------------------
                                    Telecopier:  (___)
                                                       -----------------------
                                    Telex (Answerback):
                                                         ---------------------

                           (B)      Payment Instructions:

                                    Account No.:
                                                    ----------------------------
                                               At:
                                                    ----------------------------

                                    Reference:
                                                    ----------------------------
                                    Attention:
                                                    ----------------------------

                  4.       You are entitled to rely upon the  representations,
warranties and covenants of each of the Assignor and Assignee contained in the
Assignment and Acceptance.

                  IN WITNESS WHEREOF,  the Assignor and the Assignee have caused
this Notice of Assignment and Acceptance to be executed by their respective duly
authorized officials, officers or agents as of the date first above mentioned.

Very truly yours,

[NAME OF ASSIGNOR]

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

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

[NAME OF ASSIGNEE]

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

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



ACKNOWLEDGED AND ASSIGNMENT
CONSENTED TO:


Bank of America, N. A.
as Agent

By:
        -----------------------------------------
Title:
        -----------------------------------------


<PAGE>


                                  SCHEDULE 1.1

                                   COMMITMENTS



                                    Revolving Loan        Pro Rata Share
        Lender                      Commitment             (3 decimals)
        ------
Bank of America, N.A.               $500,000,000                100%




<PAGE>