Upper Illinois River Valley Development Authority

                                         And

                                 Exolon-ESK Company



                                   Loan Agreement
                   


                            Dated as of December 1, 1996 



                                   Loan Agreement



          (This Table of Contents is not a part of this Loan Agreement
          and is only for convenience of reference)

          Table of Contents

          SECTION        HEADING                                      PAGE

           Parties                                                    1
           Preambles                                                  1
          Article I      Definition of Terms                          2
          Article II     Representations                              7
          Section 2.1.   Representations of the Issuer                7
          Section 2.2.   Representations of the Company               8
          Article III    Acquisition, Construction and Installation 
                         of the Project; Issuance of the Bonds        11
          Section 3.1.   Acquisition, Construction and Installation 
                         of the Project; Title                        11
          Section 3.2.   Agreement to Issue Bonds; Application of 
                         Bond Proceeds                                11
          Section 3.3.   Disbursements from the Acquisition 
                         and Construction Fund                        12
          Section 3.4.   Establishment of Completion Date; 
                         Obligation of Company to Complete            13
          Section 3.5.   Investment of Moneys in the Acquisition 
                         and Construction Fund, the Bond Fund and 
                         the Bond Purchase Fund                       15
          Section 3.6.   Special Arbitrage Certifications and 
                         Covenants                                    15
          Article IV     Repayment Provisions                         16
          Section 4.1.   Bond Proceeds                                16
          Section 4.2.   Repayment of the Loan and Payment of 
                         Other Amounts Payable                        16
          Section 4.3.   No Defense or Set-Off - Unconditional 
                         Obligation                                   18
          Section 4.4.   Assignment and Pledge of Issuer's Rights     19
          Article V      Special Covenants and Agreements             19
          Section 5.1.   Issuer's and Trustee's Right of Access 
                         to the Project and the Premises              19
          Section 5.2.   Company to Maintain Its Corporate 
                         Existence; Conditions under Which 
                         Exceptions Permitted                         19
          Section 5.3.   Release and Indemnification Covenants        20
          Section 5.4.   Records and Financial Statements of Company  21
          Section 5.5.   Tax-Exempt Status                            22
          Section 5.6.   Insurance                                    23
          Section 5.7.   Maintenance and Repair                       23
          Section 5.8.   Qualification in State                       23
          Section 5.9.   Letter of Credit                             23
          Article VI     Events of Default and Remedies               27
          Section 6.1.   Events of Default                            27
          Section 6.2.   Remedies on Default                          28
          Section 6.3.   Agreement to Pay Attorneys' Fees and  
                         Expenses                                     29
          Section 6.4.   No Remedy Exclusive                          29
          Section 6.5.   No Additional Waiver Implied by One Waiver   30
          Article VII    Prepayment of Note                           30
          Section 7.1.   Obligation to Prepay the Note upon 
                         Determination of Taxability                  30
          Section 7.2.   General Option to Prepay the Note            30
          Section 7.3.   Option to Prepay the Note in Extraordinary 
                         Events                                       30
          Section 7.4.   Obligation to Prepay the Note with Moneys 
                         Remaining in the Acquisition and 
                         Construction Fund                            31
          Section 7.5.   Obligation to Prepay the Note for Mandatory
                         Sinking Fund Redemptions                     31
          Section 7.6.   Redemption of the Bonds                      32
          Article VIII   Financing Statements                         32
          Article IX     Miscellaneous                                33
          Section 9.1.   Notices                                      33
          Section 9.2.   Assignments                                  33
          Section 9.3.   Severability                                 33
          Section 9.4.   Execution of Counterparts                    33
          Section 9.5.   Amounts Remaining in Any Fund or with 
                         Trustee                                      33
          Section 9.6.   Amendments, Changes and Modifications        34
          Section 9.7.   Governing Law                                34
          Section 9.8.   Authorized Company Representative            34
          Section 9.9.   Term of This Agreement                       34
          Section 9.10.  Binding Effect                               35
          Section 9.11.  References to Bank and Letter of Credit      35
                         Signature                                    36

          Exhibit A Description of Project
          Exhibit B Promissory Note
          Exhibit C Description of Real Estate
          Exhibit D Form of Requisition Certificate 


                                   Loan Agreement

          This Loan Agreement (the "Agreement") dated as of December 1,
          1996 by and between the Upper Illinois River Valley Development
          Authority, a political subdivision, body politic and municipal
          corporation duly organized and validly existing under the laws of
          the State of Illinois (the "Issuer"), and Exolon-ESK Company, a
          corporation duly organized and validly existing under the laws of
          the State of Delaware (the "Company");

          Witnesseth:

          Whereas, pursuant to the Constitution and the laws of the State
          of Illinois (the  State ), and particularly 70 Illinois Compiled
          Statutes 1994, 530/1 et seq., as supplemented and amended
          (collectively, the "Act"), the Issuer is authorized to issue its
          revenue bonds to finance the cost of "projects," as defined in
          the Act; and 

          Whereas, pursuant to and in accordance with the Act, the Issuer
          has agreed to issue and sell its Variable Rate Demand Solid Waste
          Disposal Revenue Bonds, Series 1996-A (Upper Illinois River
          Valley Development Authority Project) in the aggregate principal
          amount of $8,405,000 (the "Series 1996-A Bonds") and its Taxable
          Variable Rate Demand Solid Waste Disposal Revenue Bonds, Series
          1996-B (Exolon-ESK Company Project) in the aggregate principal
          amount of $4,595,000 (the "Series 1996-B Bonds"), which Series
          1996-A Bonds and Series 1996-B Bonds (collectively, the "Bonds")
          will be issued under the terms of an Indenture of Trust (the
          "Indenture") dated as of December 1, 1996, from the Issuer to
          American National Bank and Trust Company of Chicago, as trustee
          (the "Trustee"), and to lend the proceeds of the Bonds to the
          Company to finance a portion of the costs of the acquisition of
          land, the construction of a building and related improvements and
          the acquisition of machinery, equipment and related property to
          be installed therein (the "Project"), all to be used for the
          disposal of certain solid wastes, to be owned and operated by the
          Company and all to be located in the Village of Hennepin,
          Illinois, which Project shall constitute a "project," within the 
          meaning of the Act; and

          Whereas, the Bonds issued under the Indenture will be secured by
          (i) an assignment and pledge of all right, title and interest of
          the Issuer in and to this Agreement and the promissory note of
          the Company issued pursuant to this Agreement (the "Note"),
          except as otherwise provided in the Indenture, and (ii) moneys
          derived from drawings under the irrevocable, transferable letter
          of credit dated the date of issuance and delivery of the Bonds,
          issued by The Chase Manhattan Bank (the "Bank") in favor of the
          Trustee for the benefit of the owners from time to time of the
          Bonds, in the amount of (A) the aggregate principal amount of the
          Bonds (1) to enable the Trustee to pay the principal of the Bonds
          at maturity, upon call for redemption prior to maturity or
          acceleration, and (2) to enable the Trustee to pay the portion of 
          the purchase price of Bonds to be tendered or deemed to be
          tendered to it for purchase, equal to the aggregate principal
          amount of such Bonds, plus (B) an amount equal to the interest to
          accrue on the Bonds for thirty-five (35) days at the maximum rate
          of twelve percent (12%) per annum (1) to enable the Trustee to
          pay interest accrued on the Bonds on the dates and in the manner
          set forth in the Indenture, and (2) to enable the Trustee to pay
          the portion of the purchase price of Bonds tendered or deemed to
          be tendered to it for purchase, equal to the accrued interest on
          such Bonds (which initial letter of credit, together with any
          substitute letter of credit, is hereinafter referred to as the
          "Letter of Credit");

          Now, Therefore, in consideration of the respective
          representations and agreements herein contained, the parties
          hereto agree as follows (provided, that in the performance of the
          agreements of the Issuer herein contained, any obligation it may
          thereby incur for the payment of money shall be a special,
          limited obligation of the Issuer, and shall not constitute a
          general obligation, debt or liability of the Issuer, the State or
          any political subdivision thereof, or a charge against the
          general credit, taxing powers or general funds or assets of the
          Issuer, the State or any political subdivision thereof, but shall
          be payable solely out of the proceeds derived from this
          Agreement, the Note, the Letter of Credit and the sale of the
          Bonds referred to in Section 3.2 hereof, all as herein provided):

                                      Article I
                                 Definition of Terms

          All words and phrases defined in Article I of the Indenture shall
          have the same meanings in this Agreement.  Certain terms used in
          this Agreement are hereinafter defined in this Article I.  When
          used herein, such terms shall have the meanings given to them by
          the language employed in this Article I defining such terms,
          unless the context clearly indicates otherwise:

          "Acquisition and Construction Fund" means the Upper Illinois
          River Valley Development Authority Variable Rate Demand Solid
          Waste Disposal Revenue Bond Acquisition and Construction Fund
          (Exolon-ESK Company Project), created and established in Section
          6.6 of the Indenture.

          "Acquisition and Construction Period" means the period between
          the beginning of the acquisition, construction and installation
          of the Project or the date on which the Bonds are first delivered
          to the purchasers thereof, whichever is earlier, and the
          Completion Date.

          "Act" means 70 Illinois Compiled Statutes 1994, 530/1 et seq., as
          from time to time supplemented and amended.

          "Agreement" means this Loan Agreement, as from time to time
          supplemented and amended. 

          "Alternate Credit Facility" means an irrevocable letter of
          credit, a surety bond, an insurance policy or other credit
          facility delivered to the Trustee pursuant to Section 5.9(e) of
          this Agreement.

          "Authorized Company Representative" means such person at the time
          and from time to time designated to act on behalf of the Company
          by written certificate furnished to the Issuer, the Trustee and
          the Bank, containing the specimen signature of such person,
          signed on behalf of the Company by the president, any vice
          president, the treasurer or the secretary of the Company.  Such
          certificate may designate an alternate or alternates.

          "Bank" means The Chase Manhattan Bank, in its capacity as the
          issuer of the initial Letter of Credit pursuant to Section 5.9(a)
          hereof, its successors in such capacity and their assigns, and
          the issuer of any substitute Letter of Credit pursuant to Section
          5.9(b), Section 5.9(c) or Section 5.9(d) hereof, and its
          successors in such capacity and their assigns.

          "Bond" or "Bonds" means the Series 1996-A Bonds and the Series
          1996-B Bonds.

          "Bond Counsel" means the counsel who renders the opinion as to
          the tax-exempt status of the interest on the Series 1996-A Bonds
          on the date of the issuance, sale and delivery of the Series
          1996-A Bonds or such other firm of attorneys of nationally
          recognized standing on the subject of bonds of states and their
          political subdivisions, as may be mutually satisfactory to the
          Issuer, the Company and the Trustee.

          "Bond Fund" means the Upper Illinois River Valley Development
          Authority Variable Rate Demand Solid Waste Disposal Revenue Bond
          Fund (Exolon-ESK Company Project), created and established in
          Section 6.2 of the Indenture.

          "Bond Purchase Fund" means the Upper Illinois River Valley
          Development Authority Variable Rate Demand Solid Waste Disposal
          Revenue Bond Purchase Fund (Exolon-ESK Company Project), created
          and established in Section 6.10 of the Indenture.

          "Building" means the buildings to be constructed and financed
          with the proceeds of the Bonds, constituting a portion of the
          Project.

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

          "Company" means Exolon-ESK Company, a corporation duly organized,
          validly existing and in good standing under the laws of the State
          of Delaware, and any surviving, resulting or transferee
          corporation as permitted under Section 5.2 of this Agreement.

          "Completion Date" means the date of completion of the Project as
          that date shall be certified as provided in Section 3.4 of this
          Agreement. 

          "Costs of Issuance" means those issuance costs described in
          Section 147(g) of the Code and any Regulations.

          "Costs of the Project" means the sum of the items authorized to
          be paid from the Acquisition and Construction Fund pursuant to
          the provisions of subsections (a) through (i) of Section 3.3 of
          this Agreement.

          "Determination of Taxability" means (i) the receipt by the
          Company of a written notice from the Trustee or the receipt by
          the Company and the Trustee of a written notice from any owner of
          any Series 1996-A Bond of any issuance of a preliminary letter
          regarding a proposed deficiency or a statutory notice of
          deficiency by the Internal Revenue Service which holds, in
          effect, that the interest payable on such Series 1996-A Bond, or
          any installment thereof, is includible in the Federal gross
          income of the taxpayer named therein (other than a "substantial
          user" of the Project or any "related person" thereto, within the 
          meaning of Section 147(a) of the Code), (ii) the delivery to the 
          Company and the Trustee of an opinion of Bond Counsel to the effect
          that the interest payable on any Series 1996-A Bond, or any 
          installment thereof, is includible in the Federal gross income of 
          the taxpayer named therein (other than a "substantial user" of the 
          Project or any "related person" thereto, within the meaning of 
          Section 147(a) of the Code), (iii) the filing by the Company with 
          the Trustee, any owner of any Series 1996-A Bond or the Internal 
          Revenue Service of any certificate, statement, or other tax 
          schedule, return or document which discloses that the interest 
          payable on any Series 1996-A Bond, or any installment thereof, is 
          includible in the Federal gross income of the taxpayer named 
          therein (other than a "substantial user" of the Project or any 
          "related person" thereto within the meaning of Section 147(a) of 
          the Code), or (iv) any amendment, modification, addition or change
          shall be made in Section 142 of the Code or any other provision of
          the Code or in any regulation or proposed regulation thereunder; 
          or any ruling shall be issued or revoked by the Internal Revenue 
          Service; or any other action shall be taken by the Internal Revenue
          Service, the Department of Treasury or any other governmental agency,
          authority or instrumentality; or any opinion of any Federal court
          or of the United States Tax Court shall be rendered; and the
          Trustee, the Bank or the owner of any Series 1996-A Bond shall
          have notified the Company in writing that, as a result of any
          such event or condition, Bond Counsel is unable to give an
          unqualified opinion that the interest payable on any Series
          1996-A Bond, or any installment thereof, made on or after a date
          specified in said notice is excludible from the Federal gross
          income of the taxpayer named therein (other than a "substantial
          user" of the Project or any "related person" thereto, within the
          meaning of Section 147(a) of the Code).

          "Equipment" means the machinery, equipment and related property
          to be acquired and installed with a portion of the proceeds of
          the Bonds, more particularly described in Exhibit A attached 
          hereto and made a part hereof, comprising a portion of the
          Project.

          "Event of Default" means an event of default specified in Section
          6.1 of this Agreement.

          "Improvements" means the improvements to be constructed with a
          portion of the proceeds of the Bonds, more particularly described
          in Exhibit A attached hereto and made a part hereof, comprising a
          portion of the Project.

          "Indenture" means the Indenture of Trust dated as of December 1,
          1996, from the Issuer to the Trustee, as from time to time
          supplemented and amended.

          "Investment Obligations" means:  (i) Governmental Obligations;
          (ii) interest-bearing savings accounts, interest-bearing
          certificates of deposit or interest-bearing time deposits of any
          bank, as defined by the Illinois Banking Act, which are insured
          by the Federal Deposit Insurance Corporation or any successor
          corporation, including without limitation the Trustee; (iii)
          short-term obligations of corporations organized in the United
          States of America with assets exceeding $500,000,000, if (A) such
          obligations are rated on the date of purchase and at any time
          held by the Trustee within one of the three (3) highest rating
          classifications established by at least two (2) standard rating
          services (without regard to any rating refinement or gradation by
          numerical or other modifier), including without limitation the
          Rating Agency and at least one (1) other rating service, and
          mature not later than 180 days from the date of purchase, and (B)
          such purchases do not exceed ten percent (10%) of such
          corporations' outstanding obligations; (iv) money market mutual
          funds registered under the Investment Company Act of 1940, as
          from time to time amended, provided that the portfolio of any
          such money market fund is limited to Government Obligations or
          agreements to repurchase such Government Obligations and such
          fund is rated on the date of purchase and at any time held by the
          Trustee in the highest rating classification by the Rating
          Agency; (v) short-term discount obligations of the Federal
          National Mortgage Association; (vi) obligations issued by any
          state, unit of local government or school district, which
          obligations are rated on the date of purchase and at any time
          held by the Trustee by the Rating Agency within one of the two
          (2) highest rating classifications (without regard to rating
          refinement or gradation by numerical or other modifier); (vii)
          investment contracts under which securities are to be purchased
          and sold at a predetermined price on a future date, or pursuant
          to which moneys are deposited with a bank or other financial
          institution and the deposits are to bear interest at an agreed
          upon rate; provided that such investment contracts are rated on
          the date of purchase and at any time held by the Trustee by the
          Rating Agency within one of the two (2) highest rating
          classifications (without regard to rating refinement or
          graduation by numerical or other modifier); and (viii) any other 
          investments permitted by law if such investments are rated on the
          date of purchase and at any time held by the Trustee within one
          of the two (2) highest classifications (without regard to rating
          refinement or graduation by numerical or other modifier)
          established by the Rating Agency; or (ix) any other investment
          permitted by law.

          "Issuer" means the Upper Illinois River Valley Development
          Authority, a political subdivision, body politic and municipal
          corporation duly organized and validly existing under the laws of
          the State, and any successor body to the duties or functions of
          the Issuer.

          "Land" means the land purchased with a portion of the proceeds of
          the Bonds, constituting a part of the Project, and more
          particularly described in Part of I of Exhibit C attached to and
          made a part of this Agreement.

          "Letter of Credit" means the initial irrevocable, transferable
          Letter of Credit delivered to the Trustee pursuant to Section
          5.9(a) hereof, and, unless the context or use indicates another
          or different meaning or intent, any substitute Letter of Credit
          delivered to the Trustee pursuant to Section 5.9(b), Section
          5.9(c) or Section 5.9(d) of this Agreement.

          "Letter of Credit Agreement" means the Letter of Credit
          Reimbursement Agreement dated as of December 1, 1996, by and
          between the Company and the Bank, as from time to time
          supplemented and amended, under the terms of which the Bank
          agrees to issue and deliver the initial Letter of Credit to the
          Trustee; and, unless the context or use indicates another or
          different meaning or intent, any letter of credit agreement or
          reimbursement agreement by and between the Company and the issuer
          of any substitute Letter of Credit delivered to the Trustee
          pursuant to Section 5.9(b), Section 5.9(c) or Section 5.9(d)
          hereof, as from time to time supplemented and amended, which
          provides that it is a Letter of Credit Agreement for purposes of
          this Agreement and the Indenture.

          "Note" means the promissory note of the Company made payable to
          the order of the Issuer and endorsed by the Issuer to the order
          of the Trustee, delivered by the Company pursuant to Section
          4.2(a) hereof, in order to evidence the obligation of the Company
          to repay the loan made hereunder, payments on which Note are
          provided to be sufficient to pay the principal of, premium, if
          any, and interest on the Bonds when due.

          "Premises" means the land on which the existing manufacturing
          facilities of the Company are located (more particularly
          described in Exhibit C attached hereto and made a part hereof),
          the buildings, the machinery, the equipment and the other related
          property located thereon and the Project.

          "Project" means the Land, the Building, the Improvements, the 
          Equipment and related property to be acquired, constructed and
          installed by the Company and financed with the proceeds of the
          Bonds.

          "Rebate Fund" means the fund by that name, created and
          established under the Tax Exemption Certificate and Agreement.

          "Regulations" means those regulations, whether now or hereafter
          adopted, proposed or temporary, prepared by the United States
          Department of the Treasury with respect to Section 103 or any of
          Sections 141 through 150 of the Code.

          "Remarketing Agent" means Gates Capital Corporation, and any
          successors thereto, appointed in accordance with Section 10.11 of
          the Indenture.

          "Remarketing Agreement" means the Remarketing Agreement dated as
          of December 1, 1996, by and among the Issuer, the Company and the
          Remarketing Agent, as from time to time supplemented and amended,
          and any remarketing agreement entered into in substitution
          therefor.

          "Series 1996-A Bonds" means the Variable Rate Demand Solid Waste
          Disposal Revenue Bonds, Series 1996-A (Exolon-ESK Company
          Project) of the Issuer, in the aggregate principal amount of
          $8,405,000, issued pursuant to the Indenture.

          "Series 1996-B Bonds" means the Taxable Variable Rate Demand
          Solid Waste Disposal Revenue Bonds, Series 1996-B (Exolon-ESK
          Company Project) of the Issuer, in the aggregate principal amount
          of $4,595,000, issued pursuant to the Indenture.

          "State" means the State of Illinois.

          "Stated Termination Date" means the date on which the Letter of
          Credit, as from time to time extended, is stated to expire.

          "Tax Exemption Certificate and Agreement" means the Tax Exemption
          Certificate and Agreement of the Company, dated the date of
          issuance and delivery of the Series 1996-A Bonds.

          "Trustee" means the Trustee as defined under the Indenture.
          The words "hereof," "herein," "hereunder" and other words of
          similar import refer to this Agreement as a whole.

          Unless otherwise specified, references to Articles, Sections and
          other subdivisions of this Agreement are to the designated
          Articles, Sections and other subdivisions of this Agreement as
          originally executed.

          The headings of this Agreement are for convenience only and shall
          not define or limit the provisions of this Agreement.

                                     Article II 

                                   Representations

          Section 2.1. Representations of the Issuer. The Issuer makes the
          following representations as the basis for the undertakings on
          its part herein contained:

                   (a)   The Issuer is duly constituted and validly
          existing as a political subdivision, body politic and municipal
          corporation under the laws of the State.  Under the provisions of
          the Act, the Issuer has the power to enter into the transactions
          contemplated by this Agreement, the Indenture, the Remarketing
          Agreement and the Tax Exemption Certificate and Agreement and to
          carry out its obligations hereunder and thereunder.  The Project
          constitutes and will constitute a "project," within the meaning
          of the Act.  By proper action of the members of the Issuer, the
          Issuer has been duly authorized to execute and deliver this
          Agreement, the Indenture, the Remarketing Agreement and the Tax
          Exemption Certificate and Agreement.

                   (b)   Neither the execution and delivery of this
          Agreement, the Indenture, the Remarketing Agreement, the Tax
          Exemption Certificate and Agreement and the Bonds, the
          consummation of the transactions contemplated hereby or thereby,
          nor the fulfillment of or compliance with the terms and
          conditions of this Agreement, the Indenture, the Remarketing
          Agreement, the Tax Exemption Certificate and Agreement and the
          Bonds, conflicts with or results in a breach of the terms,
          conditions or provisions of any restriction or any agreement or
          instrument to which the Issuer is now a party or by which it is
          bound, or constitutes a default under any of the foregoing.

                   (c)   To finance a portion of the Costs of the Project,
          the Issuer proposes to issue its Bonds in the amount and having
          the terms and conditions specified in Articles II, III and IV of
          the Indenture.  The proceeds of the Bonds will be lent to the
          Company and used by the Company to finance a portion of the Costs
          of the Project as set forth in Section 3.3 of this Agreement.

                   (d)   The Issuer has not assigned or pledged, and will
          not assign or pledge, its right, title or interest in or to this
          Agreement or the Note, other than to secure the Bonds and as
          otherwise provided in the Indenture.

                   (e)   The Issuer is not in default under any of the
          provisions of the Constitution and the laws of the State which
          would affect its existence or its powers referred to in the
          preceding subsection (a).

                   (f)   Under existing statutes and decisions, no taxes on
          income or profits are imposed on the Issuer.

                   (g)   The Issuer hereby finds and determines that the
          financing of the Project with the proceeds of the Bonds will
          further the public purposes stated in the Act, and that all 
          requirements of the Act incident to the issuance of the Bonds
          have been completed.

                   (h)   No member of the Issuer or any officer, employee
          or agent of the Issuer has a pecuniary interest in any
          employment, financing agreement or other contract made with
          respect to the Company, the Project, the Bonds, the Indenture,
          this Agreement or the transactions contemplated thereby or by
          this Agreement.

                   (i)   The Issuer, pursuant to Section 6(b) of the Act,
          submitted notice, including a description of the Project and the
          financing therefor, to the corporate authorities of the Village
          of Hennepin, Putnam County, Illinois, which has planning and
          subdivision control jurisdiction over the Project, and the Issuer
          has not been informed by said corporate authorities of any
          objection to the Project.

                   (j)   The Governor of the State has provided written
          approval for the issuance of the Bonds, as required by Section
          7(a) of the Act.

          Section 2.2.   Representations of the Company.  The Company makes
          the following representations as the basis for the undertakings
          on its part herein contained:

                   (a)   The Company is a corporation duly organized,
          validly existing and in good standing under the laws of the State
          of Delaware, and has the power to enter into, and, by proper
          corporate action, has been duly authorized to execute and deliver
          this Agreement, the Note, the Letter of Credit Agreement, the
          Remarketing Agreement and the Tax Exemption Certificate and
          Agreement.

                   (b)   Neither the execution and delivery of this
          Agreement, the Note, the Letter of Credit Agreement, the
          Remarketing Agreement and the Tax Exemption Certificate and
          Agreement, the consummation of the transactions contemplated
          hereby or thereby, nor the fulfillment of or compliance with the
          terms and conditions of this Agreement, the Note, the Letter of
          Credit Agreement, the Remarketing Agreement and the Tax Exemption
          Certificate and Agreement, conflicts with or results in a breach
          of any of the terms, conditions or provisions of any restriction
          or any agreement or instrument to which the Company is now a
          party or by which it is bound, or constitutes a default under any
          of the foregoing, or results in the creation or imposition of any
          lien, charge or encumbrance whatsoever upon any of the property
          or assets of the Company or any subsidiary of the Company, except
          as contemplated by such documents.  No condition applicable to
          the Company exists which would, upon the execution of this
          Agreement, with the lapse of time or the giving of notice, or
          both, become an Event of Default under this Agreement.

                   (c)   The Project will be acquired, constructed and 
          installed through the use of the Bond proceeds, and will be
          located on the Land and within the corporate boundaries of the
          Village of Hennepin, Illinois.

                   (d)   The Company intends to use the Project in such a
          manner so as to maintain the status of the Project as a
          "project," within the meaning of the Act, for at least the
          duration of this Agreement.

                   (e)   All of the Costs of the Project were determined or
          estimated in accordance with sound engineering and accounting
          principles.

                   (f)   The information contained in the written documents
          relating to the Project provided by the Company to the Issuer and
          Bond Counsel with respect to the Bonds is true, correct and
          complete in all material respects.

                   (g)   No part of the Project was acquired or
          constructed, and no Costs of the Project were incurred or
          expended, on or before October 14, 1994.

                   (h)   The Company will comply with the provisions of
          Section 148 of the Code, and in that connection, has executed and
          delivered the Tax Exemption Certificate and Agreement.

                   (i)   The Company will not make any payments, or
          agreements to pay, to a party, other than the United States of
          America, an amount that is required to be paid to the United
          States of America under the rebate requirements of Section 148(f)
          of the Code by entering into any transaction that reduces the
          rebatable amount because such transaction results in a smaller
          profit or a larger loss than would have resulted if the
          transaction had been at arm's length and had the yield on the
          Series 1996-A Bonds not been relevant to either party.  The
          Company will not acquire with the proceeds of the Series 1996-A
          Bonds any certificate of deposit, investment contract, or any
          other type of investment which does not comply with the
          provisions of the Code.

                   (j)   The information furnished by the Company and used
          by the Issuer in preparing the Form 8038, Information Return for
          Private Activity Bond Issues, which has been filed by or on
          behalf of the Issuer with the Internal Revenue Service Center in
          Philadelphia, Pennsylvania, pursuant to Section 149(e) of the
          Code, was true and complete as of the date of filing of said Form
          8038.

                   (k)   The weighted average maturity of the Series 1996-A
          Bonds does not exceed 120% of the weighted average estimated
          economic life of the components comprising the Project financed
          with the proceeds of the Series 1996-A Bonds, as determined
          pursuant to Section 147(b) of the Code. 

                   (l)   The property comprising the Project constitutes
          and will constitute at all times during the term of this
          Agreement, as set forth in Section 8.9 hereof, either land or
          property of a character subject to the allowance for depreciation
          under the Code; at least 95% of the net proceeds of the Series
          1996-A Bonds are being used to finance the cost of land and such
          property; and all expenditures for and all Costs of the Project
          will be charged to a capital account for Federal income tax
          purposes, or would be so chargeable either with a proper election
          or but for a proper election to deduct.  In estimating the Costs
          of the Project, no amount has been included which, under the
          Federal income tax laws, was or will be deductible by the Company
          in the year in which it was paid or incurred other than through
          an allowance for depreciation.  No portion of the proceeds from
          the sale of the Series 1996-A Bonds will be used to provide
          working capital or to finance inventory, within the meaning of
          Section 144(a) of the Code.

                   (m)   No portion of the proceeds of the Series 1996-A
          Bonds is to be used to finance the acquisition of any property
          (or an interest therein) other than property the first use of
          which is pursuant to such acquisition, and no more than 25% of
          the proceeds of the Series 1996-A Bonds will be used to finance
          the acquisition of land or any interest therein.

                   (n)   The facilities comprising the Project constitute
          and will constitute throughout the terms of this Agreement "solid
          waste disposal facilities," within the meaning of Section 142 of
          the Code.

                   (o)   The Project will further the public purposes set
          forth in the Act, including without limitation increasing
          employment opportunities and retaining employment opportunities
          in the Village of Hennepin, Illinois.

                   (p)   The operation of the Project and the Premises in
          the manner presently contemplated and as described herein does
          not and will not conflict in any material respect with any
          zoning, water or air pollution or other ordinance, order, law or
          regulation applicable to the Project on the Premises, as the case
          may be.  The Company has caused the Project to be designed in
          accordance with all applicable Federal, State and local laws or
          ordinances (including rules and regulations) relating to zoning,
          planning, building, safety and environmental quality.

                   (q)   The Company possesses, and agrees to maintain and
          obtain in the future, all necessary licenses and permits, or
          rights thereto, to operate the Project and the Premises as
          presently proposed to be operated; all such licenses, permits or
          other approvals required in connection with the acquisition,
          construction, installation and operation of the Project and the
          operation of the Premises have been duly obtained and are in full
          force and effect except for any such licenses, permits or other
          approvals which are not yet required and which will be duly 
          obtained not later than the time required or the failure to
          obtain which will not materially and adversely affect the
          acquisition, construction, installation and operation of the
          Project or the operation of the Premises.

                                     Article III

                     Acquisition, Construction and Installation
                        of the Project; Issuance of the Bonds

          Section 3.1.   Acquisition, Construction and Installation of the
          Project; Title.  The Company agrees that it will acquire,
          construct and install, or complete the acquisition, construction
          and installation of, the Project, substantially in accordance
          with the plans and specifications therefor prepared by engineers
          selected by the Company, including any and all supplements,
          amendments and additions (or deletions) thereto (or therefrom),
          which plans and specifications shall be made available to the
          Issuer, the Trustee and the Bank on request; provided, however,
          that such other facilities and property contemplated by such
          supplements, amendments and additions (or deletions) to (or from)
          the plans and specifications shall not materially impair the
          effective use of the Project contemplated by this Agreement.

          The Company represents and warrants that it has, or prior to the
          Completion Date will have, acquired good and marketable title to
          all real estate (or an interest therein) constituting the
          Premises to enable the Company to acquire, construct, install and
          use the Project as contemplated by this Agreement.  The Company
          represents and warrants that it has acquired, or will acquire,
          good and marketable title to all property constituting the
          Project and the Premises in order to enable the Company to use
          the Project as contemplated by this Agreement.

          Section 3.2.   Agreement to Issue Bonds; Application of Bond
          Proceeds.  In order to provide for the financing of the Project,
          the Issuer agrees that it will issue, sell and cause to be
          delivered to the purchasers thereof, its Series 1996-A Bonds in
          the aggregate principal amount of $8,405,000; and its Series
          1996-B Bonds in the aggregate principal amount of $4,595,000;
          each series of Bonds bearing interest, maturing, subject to prior
          redemption and subject to tender for purchase as set forth in the
          Indenture.  The Issuer will thereupon lend the proceeds of the
          Series 1996-A Bonds to the Company to pay a portion of the Costs
          of the Project, and will thereupon lend the proceeds of the
          Series 1996-B Bonds to the Company to pay a portion of the Costs
          of the Project.  The proceeds of the Bonds shall be disbursed as
          provided in Section 2.10 of the Indenture.

          Section 3.3.   Disbursements from the Acquisition and
          Construction Fund.  The Issuer authorizes and directs the
          Trustee, upon compliance with the Indenture, to disburse the
          moneys in the Acquisition and Construction Fund to or on behalf
          of the Company for the following purposes and, subject to the 
          provisions of Sections 3.5 and 3.6 hereof and the provisions of
          the Tax Exemption Certificate and Agreement, for no other
          purposes:

                   (a)   Payment to the Company of such amounts, if any, as
          shall be necessary to reimburse the Company in full for all
          advances and payments made by it at any time prior to or after
          the delivery of the Bonds for expenditures in connection with the
          preparation of plans and specifications for the Project
          (including any preliminary study or planning of the Project or
          any aspect thereof), payment to the Company or its named payees
          for costs of the acquisition, construction and installation of
          the Project, incurred and expended after December 13, 1994.

                   (b)   Payment or reimbursement of any legal, financial
          and accounting fees and expenses (including fees relating to the
          Letter of Credit), costs of the execution and filing of any
          instruments and the preparation of all other documents in
          connection therewith, and payment or reimbursement of all fees,
          costs and expenses for the preparation of this Agreement, the
          Note, the Indenture, the Letter of Credit Agreement, the Letter
          of Credit, the Remarketing Agreement, the Tax Exemption
          Certificate and Agreement and the Bonds.

                   (c)   Payment or reimbursement for labor, services,
          materials and supplies used or furnished in the acquisition,
          construction and installation of the Project, all as provided in
          the plans, specifications and work orders therefor, payment or
          reimbursement for the cost of the construction, acquisition and
          installation of utility services or other facilities and the
          acquisition and installation of all personal property deemed
          necessary in connection with the Project and payment or
          reimbursement for the miscellaneous capital expenditures
          incidental to any of the foregoing items.

                   (d)   Payment or reimbursement of the fees, if any, for
          architectural, engineering, legal, investment banking and
          supervisory services with respect to the Project.

                   (e)   To the extent not paid by a contractor for
          construction with respect to any part of the Project, payment or
          reimbursement of the premiums on all insurance required to be
          taken out and maintained during the Acquisition and Construction
          Period, if any.

                   (f)   Payment of the taxes, assessments and other
          charges, if any, that may become payable during the Acquisition
          and Construction Period with respect to the Project, or
          reimbursement thereof if paid by the Company.

                   (g)   Payment or reimbursement of expenses incurred in
          seeking to enforce any remedy against any supplier, conveyor,
          grantor, contractor or subcontractor in respect of any default
          under a contract relating to the Project. 

                   (h)   Payment of the interest on the Bonds during the
          Acquisition and Construction Period. 

                   (i)   Payment of any other costs permitted by the Act.

                   (j)   All moneys remaining in the Acquisition and
          Construction Fund after the Completion Date and after payment or
          provision for payment of all other items provided for in the
          preceding subsections (a) through (i), inclusive, of this Section
          3.3, shall at the direction of the Company be used in accordance
          with Section 3.4 of this Agreement.

          Notwithstanding the foregoing, in no event shall the Costs of
          Issuance financed with the proceeds of the Series 1996-A Bonds
          exceed $168,100 (2% of the face amount of the Series 1996-A
          Bonds).

          Except as otherwise provided in the Tax Exemption Certificate and
          Agreement, each of the payments referred to in this Section 3.3,
          other than those payments referred to in subsection (j) above,
          shall be made upon receipt by the Trustee of a written
          requisition signed by the Authorized Company Representative, and
          approved in writing by the Bank, stating with respect to each
          payment to be made:  (i) the requisition number, (ii) the name
          and address of the person, firm or corporation to whom payment is
          due, (iii) the amount to be paid, (iv) that each obligation
          mentioned therein has been properly incurred, is a proper charge
          against the Acquisition and Construction Fund and has not been
          the basis of any previous withdrawal, (v) if such payment is for
          Costs of Issuance, that such payment, together with all other
          payments of Costs of Issuance paid for out of Series 1996-A Bond
          proceeds, does not exceed $168,100, and (vi) that the amount
          remaining in the Acquisition and Construction Fund after the
          withdrawal in question is made, the reasonable estimate of
          investment income thereon, plus funds of the Company available
          for such purpose will, after payment of the amounts then
          requested, be sufficient to pay the cost of completing the
          Project.  Each such requisition shall be in substantially the
          same form as Exhibit D attached to and made a part of this
          Agreement.  The Trustee may further require that disbursements
          from the Acquisition and Construction Fund shall be effectuated
          through a construction escrow account on terms commonly employed
          with respect to construction projects in the State, or through a
          system of lien waiver examinations, established with Chicago
          Title Insurance Company.  The terms of said construction escrow
          account or said lien waiver examinations may require that
          disbursements will be made therefrom only upon issuance by said
          title insurance company of an interim mechanic's lien endorsement
          to the title policy referred to in the Letter of Credit
          Agreement, covering each disbursement.  The Company hereby agrees
          to pay any cost involved in effecting such disbursements through
          such construction escrow account or said lien waiver
          examinations.

          Section 3.4.   Establishment of Completion Date; Obligation of 
          Company to Complete.  The Completion Date shall be evidenced to
          the Trustee and the Bank by a certificate signed by the
          Authorized Company Representative, stating the Costs of the
          Project and stating that (i) the acquisition, construction and
          installation of the Project has been completed substantially in
          accordance with the plans, specifications and work orders
          therefor and all labor, services, materials and supplies used in
          such acquisition, construction and installation have been paid
          for, and (ii) all other facilities necessary in connection with
          the Project have been acquired, constructed and installed in
          accordance with the plans, specifications and work orders
          therefor, and all costs and expenses incurred in connection
          therewith (other than costs and expenses for which the Company
          has withheld payment) have been paid.  If the Company withholds
          the payment of any such cost or expense of the Project, the
          certificate shall state the amount of such withholding and the
          reason therefor.  Notwithstanding the foregoing, such certificate
          may state that it is given without prejudice to any rights
          against third parties which exist at the date of such certificate
          or which may subsequently come into being.  It shall be the duty
          of the Company to cause such certificate to be furnished to the
          Trustee and the Bank promptly after the Project shall have been
          completed.

          Within ten (10) days of the delivery by the Authorized Company
          Representative of the certificate evidencing the Completion Date,
          the Trustee shall retain in the Acquisition and Construction Fund
          a sum equal to the amounts necessary for payment of Costs of the
          Project not then due and payable or the liability for which the
          Company is contesting as set forth in said certificate.  Any
          amount not to be retained in the Acquisition and Construction
          Fund for such costs, and all amounts so retained but not
          subsequently used and for which notice of such failure of use has
          been given by the Company to the Trustee, shall be segregated by
          the Trustee and used by the Trustee, at the direction of the
          Authorized Company Representative, (a) to redeem Series 1996-A
          Bonds prior to maturity on the earliest redemption date permitted
          by the Indenture for which no premium or penalty pertains, or, at
          the option of the Company, at an earlier redemption date, (b) to
          purchase Series 1996-A Bonds on the open market prior to such
          redemption date (provided, that, if Series 1996-A Bonds are
          purchased in an amount in excess of the principal amount thereof,
          the Company shall pay such excess out of other funds) for the
          purpose of cancellation, or (c) for any other purpose, provided,
          that the Trustee is furnished with a written approval of the Bank
          and an opinion of Bond Counsel to the effect that such use is
          lawful under the Act and will not adversely affect the exclusion
          of interest on any of the Series 1996-A Bonds from gross income
          of the owners thereof for Federal income tax purposes.  Until
          used for one or more of the foregoing purposes, such segregated
          amount may be invested as permitted by Section 3.5 hereof, but
          may not be invested, without an opinion of Bond Counsel to the
          effect that such investment will not adversely affect the
          exclusion of interest on any of the Series 1996-A Bonds from 
          gross income of the owners thereof for Federal income tax
          purposes, to produce a yield on such amount (computed from the
          Completion Date and taking into account any investment of such
          amount from the Completion Date) greater than the yield on the
          Series 1996-A Bonds, computed in accordance with the applicable
          provisions of the Code and the Regulations.  The Issuer agrees to
          cooperate with the Trustee and take all required action necessary
          to redeem the Series 1996-A Bonds or to accomplish any other
          purpose contemplated by this Section 3.4. Notwithstanding the
          foregoing to the contrary, to the extent that Revenue Procedure
          79-5, as supplemented by Revenue Procedure 81-22, of the Internal
          Revenue Service is applicable to the Series 1996-A Bonds, the
          Company agrees to comply with such Revenue Procedures.

          In the event the moneys in the Acquisition and Construction Fund
          available for payment of the Costs of the Project should not be
          sufficient to pay the costs thereof in full, the Company agrees
          to pay directly the costs of completing the Project as may be in
          excess of the moneys available therefor in the Acquisition and
          Construction Fund.  The Issuer does not make any warranty, either
          express or implied, that the moneys which will be paid into the
          Acquisition and Construction Fund and which, under the provisions
          of this Agreement, will be available for payment of a portion of
          the Costs of the Project, will be sufficient to pay all the costs
          which will be incurred in that connection.  The Company agrees
          that if after exhaustion of the moneys in the Acquisition and
          Construction Fund the Company should pay any portion of the Costs
          of the Project pursuant to the provisions of this Section 3.4, it
          shall not be entitled to any reimbursement therefor from the
          Issuer, the Trustee or the Bank, nor shall it be entitled to any
          diminution of the amounts payable under Section 4.2 hereof or
          under the Note.

          Section 3.5.   Investment of Moneys in the Acquisition and
          Construction Fund, the Bond Fund and the Bond Purchase Fund.  Any
          moneys held as part of the Acquisition and Construction Fund
          shall be invested or reinvested by the Trustee, upon the oral
          direction of the Authorized Company Representative, promptly
          confirmed in writing, as provided in Article VII of the
          Indenture, to the extent permitted by law, in Investment
          Obligations, and if no direction is given, the Trustee shall
          invest moneys on deposit in the Acquisition and Construction Fund
          in obligations described in clause (iv) of the definition of
          Investment Obligations.  Any moneys held as a part of the Bond
          Fund shall be invested or reinvested by the Trustee upon the oral
          direction of the Authorized Company Representative, promptly
          confirmed in writing, as provided in Article VII of the
          Indenture, to the extent permitted by law, in Governmental
          Obligations.  Any such securities may be purchased at the
          offering or market price thereof at the time of such purchase. 
          The Trustee may make any and all such investments through its own
          bond department.

          The investments so purchased shall be held by the Trustee and 
          shall be deemed at all times a part of the Acquisition and
          Construction Fund or the Bond Fund, as the case may be, and the
          interest accruing thereon and any profit realized therefrom shall
          be credited to such fund and any net losses resulting from such
          investment shall be charged to such fund and paid by the Company. 
          Although the Company recognizes that it may obtain a broker
          confirmation or written statement containing comparable
          information at no additional costs, the Company hereby agrees
          that confirmations of investments made by the Trustee pursuant to
          Article VII of the Indenture are not required to be issued by the
          Trustee for each month in which a monthly statement is rendered. 
          No such statement need be rendered pursuant to the provisions
          hereof or of the Indenture if no activity occurred in the fund
          during such preceding month.

          Any moneys held as part of the Bond Purchase Fund shall not be
          invested.

          Section 3.6.   Special Arbitrage Certifications and Covenants. 
          The Issuer and the Company covenant and agree that so long as any
          Series 1996-A Bonds shall remain outstanding, moneys on deposit
          in any fund or account in connection with the Series 1996-A Bonds
          (whether or not such moneys were derived from the proceeds of the
          Series 1996-A Bonds or from any other source) will not be used in
          any manner which would cause the Series 1996-A Bonds to be
          classified as "arbitrage bonds," within the meaning of Section
          148 of the Code and the applicable Regulations, and further
          jointly and severally covenant and agree to comply with the
          requirements of the Tax Exemption Certificate and Agreement and
          of said Section 148 and the Regulations and to execute such
          certificates as may be necessary to evidence such compliance.  To
          the extent of any inconsistency between the Tax Exemption
          Certificate and Agreement and this Agreement, the Tax Exemption
          Certificate and Agreement shall control.

          The Issuer hereby authorizes and directs the Company to cause the
          Trustee to transfer moneys in the Acquisition and Construction
          Fund to the Rebate Fund to the extent required under the Tax
          Exemption Certificate and Agreement.

                                     Article IV
                                Repayment Provisions

          Section 4.1.   Bond Proceeds.  The Issuer covenants and agrees,
          upon the terms and conditions of this Agreement, to lend the
          proceeds received from the sale of the Bonds to the Company in
          order to finance the Costs of the Project.  Pursuant to said
          covenant and agreement, the Issuer will issue the Bonds upon the
          terms and conditions contained in the Indenture and this
          Agreement, and will lend the proceeds of the Bonds to the Company
          by causing the Bond proceeds to be applied as provided in Section
          2.10 of the Indenture and Article III of this Agreement.  Such
          proceeds shall be disbursed by the Trustee to or on behalf of the
          Company as provided in Section 3.3 of this Agreement. 

          Section 4.2.   Repayment of the Loan and Payment of Other Amounts
          Payable.  (a) As evidence of its obligation to repay the loan
          made hereunder by the Issuer, the Company will initially issue
          its Note in the principal amount of $13,000,000, payable as to
          principal as set forth in the Note.  The Note shall be dated the
          date of issuance and delivery of the Bonds, shall mature on
          December 1, 2021, except as the provisions hereinafter set forth
          with respect to prepayment may become applicable to the Note. 
          The principal of the Note shall bear interest on the unpaid
          respective portions of the principal amount thereof corresponding
          to the respective principal amounts of the Series 1996-A Bonds
          and the Series 1996-B Bonds from time to time outstanding from
          the date of the Note at such rates equal to the interest rates
          from time to time borne by the respective series of Bonds,
          calculated on the same basis and to be paid on the same dates as
          interest on the Bonds is calculated and paid from time to time. 
          The Note shall be subject to prepayment as herein provided. 
          Payments of principal of, premium, if any, and interest on the
          Note shall be made in lawful money of the United States of
          America in Federal or other immediately available funds at the
          principal corporate trust office of the Trustee.  The Note shall
          be in substantially the same form as Exhibit B attached to and
          made a part of this Agreement.  The Issuer and the Company agree
          that the Note shall be payable to the Issuer, and shall be
          endorsed and pledged by the Issuer to the Trustee.  The Company
          covenants and agrees that the payments of principal of, premium,
          if any, and interest on the Note shall at all times be sufficient
          to enable the Issuer to pay when due the principal of, premium,
          if any, and interest on the Bonds; provided, that the Excess
          Amount (as hereinafter defined) held by the Trustee in the Bond
          Fund on a payment date shall be credited against the payment due
          on such date; and provided further, that, subject to the
          provisions of the immediately following sentence, if at any time
          the amount held by the Trustee in the Bond Fund should be
          sufficient (and remain sufficient) to pay on the dates required
          the principal of, premium, if any, and interest on the Bonds then
          remaining unpaid, the Company shall not be obligated to make any
          further payments under the provisions of this Section 4.2(a) or
          on the Note.  Notwithstanding the provisions of the preceding
          sentence, if on any date the Excess Amount held by the Trustee in
          the Bond Fund is insufficient to make the then required payments
          of principal (whether at maturity or upon redemption prior to
          maturity or acceleration), premium, if any, and interest on the
          Bonds on such date, the Company shall forthwith pay such
          deficiency.  The term "Excess Amount" as of any interest payment
          date shall mean the amount in the Bond Fund on such date in
          excess of the amount required for the payment of the principal of
          the Bonds which theretofore have matured at maturity or on a date
          fixed for redemption and premium, if any, on such Bonds in all
          cases where Bonds have not been presented for payment and paid,
          or for the payment of interest which has theretofore come due in
          all cases where interest checks have not been presented for
          payment and paid. 

          If the Company shall fail to pay any installment of principal of,
          premium, if any, or interest on the Note or under this Section
          4.2(a), the installment so in default shall continue as an
          obligation of the Company until the amount so in default shall
          have been fully paid, and the Company agrees to pay the same with
          interest thereon until paid (to the extent legally enforceable)
          at a rate equal to the rate borne by the Bonds from time to time
          from the due date thereof until paid.

              (b)   The Company also agrees to pay the reasonable expenses
          of the Issuer incurred in fulfilling its obligations under this
          Agreement, the Indenture, the Remarketing Agreement and the Tax
          Exemption Certificate and Agreement.

              (c)   The Company also agrees to pay to the Trustee (i) the
          initial acceptance fee of the Trustee and the costs and expenses,
          including reasonable attorneys' fees and expenses incurred by the
          Trustee in entering into and executing the Indenture and the Tax
          Exemption Certificate and Agreement, and (ii) during the term of 
          this Agreement (A) an amount equal to the annual fee of the
          Trustee for the ordinary services of the Trustee, as trustee,
          rendered and its ordinary expenses incurred under the Indenture
          and the Tax Exemption Certificate and Agreement, including
          attorneys' fees and expenses, as and when the same become due,
          (B) the reasonable fees, charges and expenses of the Trustee, as
          and when the same become due, and (C) the reasonable fees,
          charges and expenses of the Trustee for the necessary
          extraordinary services rendered by it and extraordinary expenses
          incurred by it under the Indenture and the Tax Exemption
          Certificate and Agreement, including attorneys' fees and
          expenses, as and when the same become due.

              (d)   The Company also agrees to pay all reasonable fees,
          charges and expenses of the Remarketing Agent as set forth in the
          Remarketing Agreement in carrying out its duties and obligations
          and performing its services under and pursuant to the Indenture
          and the Remarketing Agreement.

              (e)   In addition to the payments required to be made by the
          Company pursuant to the foregoing subsections of this Section 4.2
          and the Note, the Company hereby agrees to pay to the Trustee
          amounts sufficient to pay the purchase price of any Bonds to be
          purchased pursuant to Section 4.1 or Section 4.2 of the
          Indenture, on the purchase date of such Bonds as set forth in
          said Section 4.1 or said Section 4.2, as the case may be. All
          such payments shall be made to the Trustee in lawful money of the
          United States of America in Federal or other immediately
          available funds at the principal corporate trust office of the
          Trustee.  Except as required by this Section 4.2(e), so long as a
          Letter of Credit is in effect, the Company will not, directly or
          indirectly, purchase any Bonds, except Bonds that bear interest
          at a Fixed Rate, with any moneys that do not constitute Available
          Moneys. 

              (f)   In the event that the Trustee is authorized and
          directed to draw moneys under the Letter of Credit in accordance
          with the provisions of the Indenture to the extent necessary to
          pay the principal of and interest on the Bonds and the purchase
          price of Bonds tendered or deemed to be tendered to the Trustee
          for purchase if and when due, any moneys derived from a drawing
          under the Letter of Credit shall constitute a credit against the
          obligation of the Company to make corresponding payments on the
          Note and under subsections (a) and (e) of this Section 4.2.

              (g)   If the date when any of the payments required to be
          made by this Section 4.2 is not a Business Day, then such
          payments may be made on the next Business Day with the same force
          and effect as if made on the nominal due date, and no interest
          shall accrue for the current interest payment period after such
          date, but shall accrue for the next interest payment period and
          shall be payable on the next interest payment date.

              (h)   The Company shall have, and is hereby granted, the
          option to elect to convert the interest rate borne by the Series
          1996-A Bonds and the Series 1996-B Bonds from the Weekly Rate,
          the Monthly Rate or the Adjustable Rate to the Weekly Rate, the
          Monthly Rate, the Adjustable Rate or the Fixed Rate, as the case
          may be, pursuant to the provisions of Section 2.2 of the
          Indenture, subject to the terms and conditions set forth in
          Section 2.2 of the Indenture.

          Section 4.3.   No Defense or Set-Off - Unconditional Obligation. 
          The obligations of the Company to make the payments required in
          Section 4.2 hereof and pursuant to the Note and to perform and
          observe the other agreements on its part contained herein shall
          be absolute and unconditional, irrespective of any defense or any
          rights of set-off, recoupment or counterclaim it might otherwise
          have against the Issuer or the Trustee.  The Company shall pay
          net during the term of this Agreement the payments to be made on
          account of the loan as prescribed in Section 4.2 hereof and all
          other payments required hereunder free of any deductions and
          without abatement, diminution or set-off, other than those herein
          expressly provided.  Until such time as the principal of,
          premium, if any, and interest on the Note and the Bonds shall
          have been fully paid, or provision for the payment thereof shall
          have been made in accordance with the Indenture, the Company: 
          (i) will not suspend or discontinue any payments provided for in
          Section 4.2 hereof or the Note; (ii) will perform and observe all
          of its covenants and agreements contained in this Agreement; and
          (iii) will not terminate this Agreement for any cause, including,
          without limiting the generality of the foregoing, the occurrence
          of any acts or circumstances that may constitute failure of
          consideration, destruction of or damage to the Project or the
          Premises, commercial frustration of purpose, any change in the
          tax laws of the United States of America or the State or any
          political subdivision thereof, or any failure of the Issuer, the
          Trustee or the Bank to perform and observe any agreement, whether
          express or implied, or any duty, liability or obligation arising 
          out of or connected with this Agreement, except to the extent
          permitted by this Agreement.

          Section 4.4.   Assignment and Pledge of Issuer's Rights.  As
          security for the payment of its Bonds, the Issuer will assign and
          pledge to the Trustee all right, title and interest of the Issuer
          in and to this Agreement and the Note, including the right to
          receive payments hereunder and thereunder (except the right to
          receive payments, if any, under Sections 4.2(b), 5.3 and 6.3
          hereof and the rights to make determinations and receive notices
          as herein provided), and hereby directs the Company to make said
          payments directly to the Trustee.  The Company herewith assents
          to such assignment and pledge and will make payments directly to
          the Trustee without defense or set-off by reason of any dispute
          between the Company and the Issuer, the Trustee or the Bank.

                                      Article V
                          Special Covenants and Agreements

          Section 5.1.   Issuer's and Trustee's Right of Access to the
          Project and the Premises.  The Company agrees that during the
          term of this Agreement the Issuer, the Trustee, the Bank and
          their duly authorized agents shall have the right during regular
          business hours, with reasonable notice, to enter upon and to
          examine and inspect the Project and the Premises.  The Company
          agrees that the Issuer, the Trustee, the Bank and their duly
          authorized agents shall have, subject to such limitations,
          restrictions and requirements as the Company may reasonably
          prescribe, including but not limited to the standard visitor
          agreement of the Company, such rights of access to the Project
          and the Premises.

          Section 5.2.   Company to Maintain Its Corporate Existence;
          Conditions under Which Exceptions Permitted.  The Company agrees
          that during the term of this Agreement and so long as any Bond is
          Outstanding, it will maintain its corporate existence, will not
          dissolve or otherwise dispose of all or substantially all of its
          assets, and will not consolidate with or merge into another
          corporation or permit one or more corporations to consolidate
          with or merge into it; provided, that the Company may, without
          violating the agreements contained in this Section 5.2,
          consolidate with or merge into another domestic corporation
          (i.e., a corporation incorporated and existing under the laws of
          the United States of America or any state, district or territory
          thereof) or permit one or more other domestic corporations to
          consolidate with or merge into it, or sell or otherwise transfer
          to another domestic corporation all or substantially all of its
          assets as an entirety and thereafter dissolve; provided, that in
          the event the Company is not the surviving, resulting or
          transferee corporation, as the case may be, that the surviving,
          resulting or transferee corporation (i) is a domestic corporation
          as aforesaid; (ii) is qualified to do business in the State;
          (iii) assumes in writing all of the obligations of the Company
          under this Agreement, the Note and the Tax Exemption Certificate 
          and Agreement; and (iv) has a "Consolidated Tangible Net Worth"
          (after giving effect to such merger, consolidation or transfer)
          of not less than the Consolidated Tangible Net Worth of the
          Company immediately prior to such merger, consolidation or
          transfer.  The term "Consolidated Tangible Net Worth," as used in
          this Section 5.2, shall mean the difference obtained by
          subtracting total consolidated liabilities of the Company and its
          consolidated subsidiaries, from total consolidated assets of the
          Company and its consolidated subsidiaries, less the aggregate
          amount of any intangible assets, including, without limitation,
          good will, franchises, licenses, patents, trademarks, trade
          names, copyrights, service marks and brand names.

          Section 5.3.   Release and Indemnification Covenants.  The
          Company hereby releases the Issuer and the Trustee from, and
          hereby covenants and agrees that it will pay, and will protect,
          indemnify and save the Issuer, the Trustee and their respective
          members, officers, employees, agents and persons who "control"
          the Issuer or the Trustee, as that term is defined in Section 15
          of the Securities Act of 1933, as amended (the "Indemnified
          Parties"), harmless from and against, any and all liabilities,
          losses, damages, costs and expenses (including reasonable
          attorneys' fees and expenses of the Company and the Indemnified
          Parties), causes of action, suits, claims, demands and judgments
          of whatsoever kind and nature (including those arising or
          resulting from any injury to or death of any person or damage to
          property) arising from or in any manner directly or indirectly
          growing out of or connected with the following:

                   (1)   The use, non-use, condition or occupancy of the
          properties of the Company, including without limitation the
          Project and the Premises, any repairs, construction, alterations,
          renovation, relocation, remodeling and equipping thereof or
          thereto or the condition of the properties of the Company,
          including without limitation the Project and the Premises,
          including adjoining sidewalks, streets or alleys and any
          equipment or facilities at any time located on its properties,
          including without limitation the Project, or used in connection
          therewith which are not the result of the negligence of the
          Indemnified Parties;

                   (2)   violation by the Company of any agreement,
          warranty, covenant or condition of this Agreement or any other
          agreement executed in connection with the Bonds or the Project;

                   (3)   violation of any contract, agreement or
          restriction by the Company relating to its properties, including
          without limitation the Project and the Premises;

                   (4)   violation of any law, ordinance, regulation or
          court order affecting the properties of the Company, including
          without limitation the Project and the Premises, or the
          ownership, occupancy or use thereof; 

                   (5)   any written statement or information (other than
          statements or information provided by the Issuer) furnished to
          the Issuer or the purchasers of any Bonds, including, but not
          limited to, any offering circular relating to any of the Bonds,
          that is untrue or incorrect in any material respect, and any
          omission from such information of any statement or information
          which should be contained therein for the purpose for which the
          same is to be used or which is necessary to make the statements
          therein not misleading in any material respect; and

                   (6)   the presence on or in, or the escape, seepage,
          leakage, spillage, discharge, emission or release from, the
          properties of the Company, including without limitation the
          Project and the Premises, of any hazardous or toxic waste,
          substance or constituent, or other substance.

          In the event of the settlement of any litigation commenced or
          threatened, such indemnity shall be limited to the aggregate
          amount paid under a settlement effected with the written consent
          of the Company.

          The Indemnified Parties shall promptly notify the Company in
          writing of any claim or action covered by this indemnity and
          brought against the Indemnified Parties, or in respect of which
          indemnity may be sought against the Company, setting forth the
          particulars of such claim or action, and the Company will assume
          the defense thereof, including the employment of counsel
          reasonably satisfactory to the Indemnified Parties and the
          payment of all expenses.  The Indemnified Parties may employ
          separate counsel in any such action and participate in the
          defense thereof, but the fees and expenses of such counsel shall
          not be payable by the Company unless such employment has been
          specifically authorized by the Company.

          Section 5.4.   Records and Financial Statements of Company.  The
          Issuer and the Trustee shall be permitted during regular business
          hours during the term of this Agreement to examine the books and
          records of the Company.

          The Company agrees to furnish the Issuer and the Trustee within
          one hundred twenty (120) days after the close of each fiscal year
          of the Company, with the financial statements of the Company,
          showing the financial position of the Company at the close of
          each such fiscal year and the results of the operations of the
          Company for each such fiscal year, audited by an independent
          certified public accountant selected by the Company for such
          fiscal year.  The Company further agrees to furnish the Issuer
          and the Trustee within thirty (30) days of the close of each
          quarter of each fiscal year of the Company (other than the fourth
          quarter of each such fiscal year), with the financial statements
          of the Company, showing the financial position of the Company at
          the close of each such quarter (including year to date
          information) and the results of operations of the Company for
          each such quarter, signed by the President, any Vice President or 
          the Treasurer of the Company.

          The Company further agrees to furnish the Issuer and the Trustee
          with such other financial statements and information concerning
          the Company as the Issuer or the Trustee may reasonably require.

          The Company further agrees to furnish the Trustee within ninety
          (90) days after the close of each fiscal year of the Company or
          within thirty (30) days after written request from the Trustee
          with a certificate of the Company, signed by the President, any
          Vice President or the Treasurer of the Company, to the effect
          that the signer thereof has re-examined the provisions of this
          Agreement, and at the date of said certificate has no knowledge
          of any default or Event of Default hereunder (or, if the signer
          has knowledge of any such default or Event of Default, he shall
          disclose in such certificate the nature thereof).  The Company
          further agrees to furnish the Trustee promptly after knowledge
          thereof shall have come to the attention of any responsible
          officer of the Company or of a partner thereof, written notice of
          any threatened or pending litigation or governmental proceeding
          against the Company which would materially adversely affect the
          business and properties of the Company and written notice of the
          occurrence of any default or Event of Default under this
          Agreement.

          Section 5.5.   Tax-Exempt Status.  The Company covenants with the
          Issuer and for and on behalf of the purchasers and owners of the
          Series 1996-A Bonds from time to time outstanding that so long as
          any of the Series 1996-A Bonds remain outstanding, moneys on
          deposit in any fund in connection with the Series 1996-A Bonds,
          whether or not such moneys were derived from the proceeds of the
          sale of the Series 1996-A Bonds or from any other sources, will
          not be used in a manner which will cause the Series 1996-A Bonds
          to be "arbitrage bonds," within the meaning of Section 148 of the
          Code, and any lawful Regulations promulgated thereunder, as the
          same exist on this date, or may from time to time hereafter be
          amended, supplemented or revised.  The Company also covenants for
          the benefit of the owners of the Series 1996-A Bonds to comply
          with all of the provisions of the Tax Exemption Certificate and
          Agreement.  The Company reserves the right, however, to make any
          investment of such moneys permitted by State law, if, when and to
          the extent that said Section 148 or the Regulations promulgated
          thereunder shall be repealed or relaxed or shall be held void by
          final judgment of a court of competent jurisdiction, but only
          upon receipt of an opinion of Bond Counsel with respect to such
          investment that such investment will not affect the exclusion of
          the interest on the Series 1996-A Bonds from gross income of the
          owners thereof for Federal income tax purposes.

          Neither the Issuer nor the Company shall cause any proceeds of
          the Series 1996-A Bonds to be expended except pursuant to the
          Indenture.  The Company shall not (1) requisition or otherwise
          allow any payment out of proceeds of the Series 1996-A Bonds (i)
          if such payment is to be used for the acquisition of any property 
          (or an interest therein) unless the first use of such property is
          pursuant to such acquisition, provided that this clause (i) shall
          not apply to any building (and the equipment purchased as a part
          thereof, if any) if the "rehabilitation expenditures", as defined
          in Section 147(d) of the Code, with respect to the building equal
          or exceed 15% of the portion of the cost of acquiring the
          building (including such equipment) financed with the proceeds of
          the Series 1996-A Bonds, (ii) if as a result of such payment, 25%
          or more of the proceeds of the Series 1996-A Bonds would be
          considered as having been used directly or indirectly for the
          acquisition of land (or an interest therein), (iii) if, as a
          result of such payment, less than 95% of the net proceeds of the
          Series 1996-A Bonds, expended at the time of such requisition
          would be considered as having been used for costs of the
          acquisition, construction, reconstruction or improvement of land
          or property of a character subject to the allowance for
          depreciation within the meaning of Section 142 of the Code for
          use as a "solid waste disposal facility" within the meaning of
          Section 142 of the Code, or (iv) if such payment is used to pay
          issuance costs (including attorneys' fees and placement fees) in
          excess of an amount equal to two percent (2%) of the principal
          amount of the Series 1996-A Bonds; (2) take or omit, or permit to
          be taken or omitted, any other action with respect to the use of
          such proceeds the taking or omission of which would result in the
          loss of exclusion of interest on the Series 1996-A Bonds from
          gross income for purposes of Federal income taxation; or (3) take
          or omit, or permit to be taken or omitted, any other action, the
          taking or omission of which would cause the loss of such
          exclusion.  Without limiting the generality of the foregoing, the
          Company shall not permit the proceeds of the Series 1996-A Bonds
          to be used directly for the acquisition of land (or an interest
          therein).

          The Series 1996-A Bonds and any other obligation constituting a
          private activity bond under Section 141(a) of the Code will not
          be sold (A) within fifteen (15) days prior to the issuance of the
          Series 1996-A Bonds or within fifteen (15) days after the
          issuance of the Series 1996-A Bonds, and (B) are reasonably
          expected to be paid out of substantially the same source of funds
          as the Series 1996-A Bonds.

          Section 5.6.  Insurance.  The Company agrees to maintain
          insurance with respect to the Project and the Premises with good
          and responsible insurance companies against such hazards and
          risks as are insured by companies similarly situated and
          operating like properties.

          Section 5.7.  Maintenance and Repair.  The Company agrees that it
          will maintain the Project and the Premises in good repair,
          working order and operating condition, making from time to time
          all needful and proper repairs thereto, renewals and replacements
          thereof, so that at all times the efficiency thereof shall be
          fully preserved and maintained. 

          Section 5.8.  Qualification in State.  The Company agrees that
          throughout the term of this Agreement, it will be qualified to do
          business in the State.  

          Section 5.9.  Letter of Credit.  (a) On or prior to the issuance,
          sale and delivery of the Bonds to the purchaser or purchasers
          thereof pursuant to Section 2.6 of the Indenture, the Company
          hereby covenants and agrees to obtain and deliver to the Trustee
          the initial, irrevocable, transferable Letter of Credit to be
          issued by the Bank in favor of the Trustee for the benefit of the
          owners from time to time of the Bonds, in substantially the same
          form as Exhibit A attached to the Letter of Credit Agreement. 
          The initial Letter of Credit shall be dated the date of issuance
          and delivery of the Bonds; shall expire on December 15, 2001,
          unless otherwise extended in accordance with the terms and
          provisions of subsection (b) below and the Letter of Credit
          Agreement; shall be in the amount of (i) the aggregate principal
          amount of the Bonds (A) to enable the Trustee to pay the
          principal of the Bonds at maturity, upon redemption prior to
          maturity or acceleration, and (B) to enable the Trustee to pay
          the portion of the purchase price of Bonds tendered or deemed to
          be tendered to the Trustee for purchase, equal to the aggregate
          principal amount of such Bonds, plus (ii) an amount equal to the
          interest to accrue on the Bonds for thirty-five (35) days at a
          maximum rate of twelve percent (12%) per annum (A) to enable the
          Trustee to pay interest accrued on the Bonds on the dates and in
          the manner set forth in the Indenture, and (B) to enable the
          Trustee to pay the portion of the purchase price of Bonds
          tendered or deemed to be tendered to the Trustee for purchase,
          equal to the accrued interest on such Bonds.

              (b)   Except as hereinafter provided, at any time prior to
          the fifteenth Business Day prior to the interest payment date on
          the Bonds immediately preceding the Stated Termination Date of
          the Letter of Credit, the Company may, at its option but is not
          required to, provide for the extension of the term of the Letter
          of Credit or deliver to the Trustee a substitute Letter of Credit
          as hereinafter provided.  If the Company chooses to extend the
          term of the Letter of Credit, then such extension shall be to the
          fifteenth day of any calendar month at least one (1) year after
          the Stated Termination Date of the existing Letter of Credit, and
          (unless the Letter of Credit by its terms provides for an
          extension of its term automatically unless the Trustee is
          notified to the contrary) the Company shall furnish proof of such
          extension, in the form of an amendment to the Letter of Credit
          evidencing such extension, to the Trustee no later than the
          fifteenth Business Day prior to the interest payment date on the
          Bonds immediately preceding the Stated Termination Date of the
          Letter of Credit.  In the event that the Letter of Credit by its
          terms provides for an extension of its term automatically unless
          the Trustee is notified to the contrary, such extensions shall be
          consistent with the terms and provisions set forth above, but it
          shall not be necessary to furnish such proof or amendment.  If
          the Company chooses to provide a substitute Letter of Credit, 
          such substitute Letter of Credit shall be an irrevocable letter
          of credit in substantially the same form and tenor as the initial
          Letter of Credit, in an amount equal to the outstanding principal
          amount of the Bonds plus an amount equal to the maximum interest
          to accrue on the Bonds then Outstanding for thirty-five (35) days
          at a maximum rate of twelve percent (12%) per annum, with
          administrative provisions reasonably satisfactory to the Trustee,
          but provided to expire on the fifteenth day of any calendar month
          at least one (1) year after the Stated Termination Date of the
          existing Letter of Credit, such substitute Letter of Credit to be
          issued by a commercial bank and delivered to the Trustee on or
          before the fifteenth Business Day prior to the interest payment
          date on the Bonds immediately preceding the Stated Termination
          Date of the Letter of Credit; provided, that simultaneously with
          the delivery of any such substitute Letter of Credit to the
          Trustee, the Company shall have provided the Trustee with written
          evidence from the Bank which issued the existing Letter of Credit
          that the Company shall have paid all of its obligations under the
          related Letter of Credit Agreement to such Bank (other than any
          obligations with respect to reimbursement for drawings under the
          Letter of Credit to purchase Bonds tendered or deemed to be
          tendered to the Trustee for purchase pursuant to Section 4.1 or
          Section 4.2 of the Indenture, which obligations are not yet due
          and owing under the Letter of Credit Agreement) and shall have
          paid all other amounts due and owing under the Letter of Credit
          Agreement pursuant to which the existing Letter of Credit was
          issued (except as aforesaid).  Simultaneously with the delivery
          of such substitute Letter of Credit to the Trustee, the Company
          shall also provide the Trustee with an opinion of Bond Counsel
          that such substitute Letter of Credit is authorized under this
          Agreement, complies with the terms hereof, and will not have an
          adverse effect on the exclusion of the interest on the Series
          1996-A Bonds from gross income of the owners thereof for Federal
          income tax purposes.  If the Company shall fail to furnish to the
          Trustee such written evidence from such Bank and such opinion of
          Bond Counsel on or before the specified date, the Trustee shall
          be deemed not to have received the substitute Letter of Credit,
          and the Bonds shall be subject to mandatory tender for purchase
          pursuant to Section 4.2 of the Indenture.  Upon delivery of a
          substitute Letter of Credit and the foregoing evidence and
          opinion, the Trustee is authorized and directed to surrender the
          existing Letter of Credit and to approve the cancellation of the
          existing Letter of Credit and the termination of the related
          Letter of Credit Agreement.  Any such substitute Letter of Credit
          shall be delivered to the Trustee on the first Business Day of a
          calendar month.  The Company hereby covenants and agrees to give
          the Issuer, the Trustee, the Bank and the Remarketing Agent
          written notice of its intention to deliver any such substitute
          Letter of Credit at least fifteen (15) Business Days prior to the
          date on which the Company expects to deliver such substitute
          Letter of Credit.

              (c)   If the Company elects to exercise its option to cause
          the interest rate on the Bonds to be converted to the Adjustable 
          Rate or the Fixed Rate in accordance with the provisions of
          Section 4.2(h) hereof, the Company may, at its option but is not
          required to, provide for the delivery to the Trustee of a
          substitute Letter of Credit with respect to the Bonds.  Such
          substitute Letter of Credit shall consist of an irrevocable
          letter of credit in the amount of (i) the aggregate principal
          amount of each series of Bonds then outstanding to enable the
          Trustee to pay the principal of such Bonds at maturity, upon
          redemption prior to maturity or acceleration, plus (ii) an amount
          equal to three percent (3%) of the aggregate principal amount of
          the Bonds then Outstanding to pay premium, plus (iii) an amount
          equal to the interest to accrue on such Bonds then outstanding
          for 215 days to enable the Trustee to pay interest accrued on
          such Bonds as it comes due, set to expire or terminate one
          hundred twenty-four (124) days after the conclusion of the
          Adjustable Rate Period or one hundred twenty-four (124) days
          after the final maturity of such Bonds, and having administrative
          provisions satisfactory to the Trustee.  If the Company has
          elected to deliver such a substitute Letter of Credit to the
          Trustee, the Company shall deliver to the Trustee at least
          forty-five (45) days prior to the Proposed Conversion Date an
          irrevocable commitment of a Bank to issue such substitute Letter
          of Credit, and shall deliver such substitute Letter of Credit to
          the Trustee on or before the Conversion Date.  Simultaneously
          with the delivery of such substitute Letter of Credit to the
          Trustee, the Company shall also provide the Trustee with an
          opinion of Bond Counsel to the effect that such substitute Letter
          of Credit is authorized under this Agreement, complies with the
          terms hereof and will not have an adverse effect on the exclusion
          of the interest on the Series 1996-A Bonds from gross income of
          the owners thereof for Federal income tax purposes.

              (d)   At any time while a Letter of Credit is in effect, the
          Company from time to time may, at its option, but is not required
          to, deliver to the Trustee a substitute Letter of Credit in
          substitution for the existing Letter of Credit.  The substitute
          Letter of Credit shall be an irrevocable, transferable letter of
          credit in substantially the same form and tenor as the existing
          Letter of Credit with administrative provisions satisfactory to
          the Trustee, provided to expire on the same date as the existing
          Letter of Credit or on the fifteenth day of any calendar month at
          least one (1) year after the Stated Termination Date of the
          existing Letter of Credit, such substitute Letter of Credit to be
          issued by a commercial bank and delivered to the Trustee;
          provided, that simultaneously with the delivery of any such
          substitute Letter of Credit to the Trustee, the Company shall
          have provided the Trustee with written evidence from the Bank
          which issued the existing Letter of Credit that the Company shall
          have paid all of its obligations under the Letter of Credit
          Agreement to such Bank (other than any obligations with respect
          to reimbursement for drawings under the Letter of Credit to
          purchase Bonds tendered or deemed to be tendered to the Trustee
          for purchase pursuant to Section 4.1 or Section 4.2 of the
          Indenture, which obligations are not yet due and owing under the 
          Letter of Credit Agreement) and shall have paid all other amounts
          due and owing under the Letter of Credit Agreement pursuant to
          which the existing Letter of Credit was issued (except as
          aforesaid).  Simultaneously with the delivery of such substitute
          Letter of Credit to the Trustee, the Company shall also provide
          the Trustee with an opinion of Bond Counsel that such substitute
          Letter of Credit is authorized under this Agreement, complies
          with the terms hereof and will not have an adverse effect on the
          exclusion of the interest on the Series 1996-A Bonds from gross
          income of the owners thereof for Federal income tax purposes.  If
          the Company shall fail to furnish to the Trustee such written
          evidence from such Bank and such opinion of Bond Counsel, the
          Trustee shall not be deemed to have received the substitute
          Letter of Credit, and shall not surrender the existing Letter of
          Credit.  Upon delivery of a substitute Letter of Credit and the
          foregoing evidence and opinion, the Trustee is authorized and
          directed to surrender the existing Letter of Credit.  Any such
          substitute Letter of Credit shall be delivered to the Trustee on
          the first Business Day of a calendar month.  The Company hereby
          covenants and agrees to give the Issuer, the Trustee, the Bank
          and the Remarketing Agent written notice of its intention to
          deliver any such substitute Letter of Credit at least fifteen
          (15) Business Days prior to the date on which the Company expects
          to deliver such substitute Letter of Credit.

              (e)   The Company may at its option, but is not required to,
          provide for the delivery to the Trustee of an Alternate Credit
          Facility to supplement the Letter of Credit, to replace the
          Letter of Credit or to provide credit enhancement if the Letter
          of Credit is not then in effect.  Any such Alternate Credit
          Facility shall be payable to the Trustee for the benefit of the
          owners of the Bonds and shall have administrative provisions
          satisfactory to the Trustee.  Simultaneously with the delivery of
          such an Alternate Credit Facility to the Trustee, the Company
          shall provide the Trustee with an opinion of Bond Counsel to the
          effect that the delivery of such Alternate Credit Facility is
          authorized under this Agreement, complies with the terms hereof
          and will not have an adverse effect on the exclusion of the
          interest on the Series 1996-A Bonds from gross income of the
          owners thereof for Federal income tax purposes.  Any such
          Alternate Credit Facility shall be delivered to the Trustee on
          the first Business Day of a calendar month.  The Company hereby
          covenants and agrees to give the Issuer, the Trustee, the Bank
          and the Remarketing Agent written notice of its intention to
          deliver any such Alternate Credit Facility at least fifteen (15)
          Business Days prior to the date on which the Company expects to
          deliver such Alternate Credit Facility.

              (f)   In the event that the Letter of Credit is set to expire
          and the Company does not intend to deliver a substitute Letter of
          Credit to the Trustee, the Company shall, on or before the
          fifteenth Business Day prior to the interest payment date
          immediately preceding the Stated Termination Date, give written
          notice to the Issuer, the Trustee, the Remarketing Agent and the 
          Bank that the Company does not intend to deliver such a
          substitute Letter of Credit to the Trustee prior to the Stated
          Termination Date.

              (g)   Notwithstanding any other provision of this Agreement
          or the Indenture to the contrary, upon a Conversion of the
          interest rate on the Series 1996-A Bonds to an Adjustable Rate or
          a Fixed Rate, no Letter of Credit or Alternate Credit Facility
          shall be in effect after the Conversion of such interest rate to
          the Adjustable Rate or the Fixed Rate unless the Company delivers
          to the Trustee an opinion of Bond Counsel to the effect that such
          maintenance of such Letter of Credit or Alternate Credit Facility
          will not have an adverse effect on the exclusion of the interest
          on the Series 1996-A Bonds from gross income of the owners
          thereof for Federal income tax purposes.

                                     Article VI
                           Events of Default and Remedies

          Section 6.1.   Events of Default.  The occurrence and
          continuation of any one of the following shall constitute an
          Event of Default hereunder:

                   (a)   failure by the Company to pay any amounts required
          to be paid as principal, premium, if any, or interest on the Note
          or under this Agreement on the dates and in the manner specified
          therein or herein; or

                   (b)   failure by the Company to pay any amounts pursuant
          to Section 4.2(e) hereof on the dates and in the manner specified
          therein; or

                   (c)   failure by the Company to observe and perform any
          covenant, condition or agreement on its part to be observed or
          performed in this Agreement, other than as referred to in
          subsections (a) and (b) above, for a period of thirty (30) days
          after written notice, specifying such failure and requesting that
          it be remedied, is given to the Company by the Issuer, the
          Trustee or the Bank, unless (i) the Issuer, the Trustee and the
          Bank shall agree in writing to an extension of such time prior to
          its expiration, or (ii) if the failure is such that it can be
          corrected, but not within such 30-day period, corrective action
          is instituted by the Company within such period and diligently
          pursued until such failure is corrected; provided, that such
          failure is corrected within one (1) year; or

                   (d)   the dissolution or liquidation of the Company or
          the filing by the Company of a voluntary petition in bankruptcy,
          or failure by the Company promptly to lift any execution,
          garnishment or attachment of such consequence as will impair its
          ability to carry on its obligations hereunder, or an order for
          relief under the Federal bankruptcy laws, as amended from time to
          time, is entered against the Company, or a petition or answer
          proposing the entry of an order for relief against the Company 
          under the Federal bankruptcy laws, as amended from time to time,
          or its reorganization, arrangement or debt readjustment under any
          present or future Federal bankruptcy act or any similar Federal
          or state law shall be filed in any court and such petition or
          answer shall not be discharged within ninety (90) days after the
          filing thereof, or the Company shall fail generally to pay its
          debts as they become due, or a custodian (including without
          limitation a receiver, trustee, assignee for the benefit of
          creditors or liquidator of the Company) shall be appointed for or
          take possession of all or a substantial part of its property and
          shall not be discharged within ninety (90) days after such
          appointment or taking possession, or the Company shall consent to
          or acquiesce in such appointment or taking possession, or
          assignment by the Company for the benefit of its creditors, or
          the entry by the Company into an agreement of composition with
          its creditors; provided, that the term "dissolution or
          liquidation of the Company," as used in this subsection (d),
          shall not be construed to include the cessation of the corporate
          existence of the Company resulting either from a merger or
          consolidation of the Company into or with another domestic
          corporation or a dissolution or liquidation of the Company
          following a transfer of all or substantially all of its assets as
          an entirety, under the conditions permitting such actions
          contained in Section 5.2 hereof; or

                   (e)   any warranty, representation or other statement
          made by or on behalf of the Company contained herein or in any
          document or certificate furnished by the Company in compliance
          with or in reference hereto, is false or misleading in any
          material respect; or

                   (f)   an "event of default" shall occur and be
          continuing under the Indenture.

          Section 6.2.   Remedies on Default.  Whenever any Event of
          Default shall have occurred and be continuing hereunder, the
          Trustee may take any one or more of the following remedial steps:

                   (a)   The Trustee may exercise any right, power or
          remedy permitted to it by law as a holder of the Note, and shall
          have in particular, without limiting the generality of the
          foregoing, the right to declare the entire principal and all
          unpaid interest accrued on the Note to the date of such
          declaration and any premium the Company shall have become
          obligated to pay to be immediately due and payable, if
          concurrently with or prior to such notice the unpaid principal of
          and all unpaid accrued interest and premium on the Bonds have
          been declared to be due and payable under the Indenture, and upon
          such declaration the Note and the unpaid accrued interest thereon
          and such premium shall thereupon become forthwith due and payable
          in an amount sufficient to pay the principal of, premium, if any,
          and interest on the Bonds under Section 9.2 of the Indenture,
          without presentment, demand or protest, all of which are hereby
          expressly waived.  The Company shall forthwith pay to the Trustee
          the entire principal of, premium, if any, and interest accrued on 
          the Note.

          The Trustee (or any owner of any Bond) shall waive, rescind and
          annul such declaration and the consequences thereof, when any
          declaration of acceleration on the Bonds has been waived,
          rescinded and annulled pursuant to and in accordance with Section
          9.2 of the Indenture.

                   (b)   The Issuer or the Trustee may take whatever action
          at law or in equity may appear necessary or desirable to collect
          the payments and other amounts then due and thereafter to become
          due or to enforce the performance and observance of any
          obligation, agreement or covenant of the Company under this
          Agreement.

          In case the Issuer or the Trustee shall have proceeded to enforce
          its rights under this Agreement, and such proceedings shall have
          been discontinued or abandoned for any reason or shall have been
          determined adversely to the Issuer or the Trustee, as the case
          may be, then and in every such case the Company, the Issuer and
          the Trustee shall be restored respectively to their several
          positions and rights hereunder, and all rights, remedies and
          powers of the Company, the Issuer and the Trustee shall continue
          as though no such proceeding had been taken.

          In case there shall be pending proceedings for the bankruptcy or
          for the reorganization of the Company under the Federal
          bankruptcy laws or any other applicable law, or in case a
          receiver or trustee shall have been appointed for the property of
          the Company, or in the case of any other similar judicial
          proceedings relative to the Company, or to the creditors or
          property of the Company, the Trustee shall be entitled and
          empowered, by intervention in such proceedings or otherwise, to
          file and prove a claim or claims for the whole amount owing and
          unpaid pursuant to this Agreement and the Note and, in case of
          any judicial proceedings, to file such proofs of claim and other
          papers or documents as may be necessary or advisable in order to
          have the claims of the Trustee allowed in such judicial
          proceedings relative to the Company, its creditors or its
          property, and to collect and receive any moneys or other property
          payable or deliverable on any such claims, and to distribute the
          same after the deduction of its charges and expenses; and any
          receiver, assignee or trustee in bankruptcy or reorganization is
          hereby authorized to make such payments to the Trustee, and to
          pay to the Trustee any amount due it for compensation and
          expenses, including reasonable counsel fees and expenses incurred
          by it up to the date of such distribution.

          Section 6.3.   Agreement to Pay Attorneys' Fees and Expenses.  In
          the event the Company should default under any of the provisions
          of this Agreement and the Issuer or the Trustee should employ
          attorneys or incur other expenses for the collection of the
          payments due under this Agreement or the Note or the enforcement
          of the performance or observance of any obligation or agreement 
          on the part of the Company herein contained, the Company agrees
          that it will on demand therefor pay to the Issuer or the Trustee
          the reasonable fees and expenses of such attorneys and such other
          expenses so incurred by the Issuer or the Trustee.

          Section 6.4.   No Remedy Exclusive.  No remedy herein conferred
          upon or reserved to the Issuer or the Trustee is intended to be
          exclusive of any other available remedy or remedies, but each and
          every such remedy shall be cumulative and shall be in addition to
          every other remedy given under this Agreement and the Indenture
          or now or hereafter existing at law or in equity or by statute. 
          No delay or omission to exercise any right or power accruing upon
          any Event of Default hereunder shall impair any such right or
          power or shall be construed to be a waiver thereof, but any such
          right and power may be exercised from time to time and as often
          as may be deemed expedient.  In order to entitle the Issuer to
          exercise any remedy reserved to it in this Article VI, it shall
          not be necessary to give any notice, other than such notice as
          may be herein expressly required.  Such rights and remedies as
          are given the Issuer hereunder shall also extend to the Trustee,
          and the Trustee and the owners from time to time of the Bonds
          shall be deemed third party beneficiaries of all covenants and
          agreements herein contained.

          Section 6.5.   No Additional Waiver Implied by One Waiver.  In
          the event any agreement contained in this Agreement should be
          breached by the Company and thereafter waived by the Issuer or
          the Trustee, such waiver shall be limited to the particular
          breach so waived and shall not be deemed to waive any other
          breach under this Agreement.

                                     Article VII
                                 Prepayment of Note

          Section 7.1.   Obligation to Prepay the Note upon Determination
          of Taxability.  Upon the occurrence of a Determination of
          Taxability, the Company shall have, and hereby accepts, the
          obligation to prepay a sufficient portion of the principal of the
          Note in part, on any date within thirty (30) days of the
          occurrence of a Determination of Taxability, by paying to the
          Trustee an amount sufficient to redeem all of the Series 1996-A
          Bonds pursuant to Section 3.1(b) of the Indenture.  The amount to
          be prepaid pursuant to this Section 7.1 in such event shall be
          100% (or 103% during the Adjustable Rate Period or the Fixed Rate
          Period) of the then Outstanding principal amount of the Series
          1996-A Bonds plus accrued interest to the date fixed for
          redemption.  So long as the Letter of Credit is in effect, and to
          the extent that Available Moneys described in clauses (a) and (b)
          of Section 6.4 of the Indenture are not on deposit in the Bond
          Fund and available to prepay the principal of, premium, if any,
          and accrued interest on the Note payable under this Section 7.1,
          the Trustee shall, in accordance with Section 6.4 of the
          Indenture, draw upon the Letter of Credit to prepay the principal
          of, premium, if any, and accrued interest on the Note payable 
          under this Section 7.1 in accordance with the terms of the Letter
          of Credit.

          Section 7.2.   General Option to Prepay the Note.  The Company
          shall have, and is hereby granted, the option to prepay the
          principal of the Note as a whole, or in part, by paying to the
          Trustee an amount sufficient to redeem all or a portion of the
          Bonds then outstanding, in the manner, at the redemption prices
          (including premium, if any), from the sources and on the dates
          specified in Section 3.1(a) of the Indenture.  So long as the
          Letter of Credit is in effect, and to the extent that Available
          Moneys described in clauses (a) and (b) of Section 6.4 of the
          Indenture are not on deposit in the Bond Fund and available to
          prepay the principal of and accrued interest on the Note under
          this Section 7.2, the Trustee shall, in accordance with Section
          6.4 of the Indenture, draw upon the Letter of Credit to prepay
          the principal of and accrued interest on the Note payable under
          this Section 7.2 in accordance with the terms of the Letter of
          Credit.

          Section 7.3.   Option to Prepay the Note in Extraordinary Events. 
          The Company shall have, and is hereby granted, the option to
          prepay the principal of the Note, on any date, as a whole, and
          not in part, at a prepayment price of 100% of the principal
          amount of the Note then outstanding, plus accrued interest to the
          date fixed for prepayment, within one hundred eighty (180) days
          of the occurrence of any of the following:

                   (a)   the Project or the Premises shall have been
          damaged or destroyed (in whole or in part) by fire or other
          casualty to such extent that, in the opinion of the Company
          expressed in a certificate filed with the Issuer and the Trustee,
          it is not practicable or desirable to rebuild, repair or restore
          the Project or the Premises, as the case may be, within a period
          of six (6) consecutive months following such damage or
          destruction, or

                   (b)   title to, or the temporary use of, all or
          substantially all of the Project or the Premises shall have been
          taken under the exercise of the power of eminent domain by any
          governmental authority or person, firm or corporation acting
          under governmental authority (including such a taking or takings
          as results or is likely to result, in the opinion of the Company
          expressed in a certificate filed with the Issuer and the Trustee,
          in the Company being thereby prevented from carrying on its
          normal operations at the Project or the Premises, as the case may
          be, for a period of six (6) consecutive months or results or is
          likely to result in rendering the Project or the Premises, as the
          case may be, unsuitable for use by the Company).
          So long as the Letter of Credit is in effect, and to the extent
          that Available Moneys described in clauses (a) and (b) of Section
          6.4 of the Indenture are not on deposit in the Bond Fund and
          available to prepay the principal of and accrued interest on the
          Note payable under this Section 7.3, the Trustee shall, in
          accordance with Section 6.4 of the Indenture, draw upon the 
          Letter of Credit to prepay the principal of and accrued interest
          on the Note payable under this Section 7.3 in accordance with the
          terms of the Letter of Credit.

          Section 7.4.   Obligation to Prepay the Note with Moneys
          Remaining in the Acquisition and Construction Fund.  The Company
          shall have, and hereby accepts, the obligation to prepay the
          principal of the Note in part, on any date within thirty (30)
          days after the receipt by the Trustee of a completion certificate
          pursuant to Section 3.4 hereof with moneys remaining in the
          Acquisition and Construction Fund (other than any moneys withheld
          and used to pay Costs of the Project, as set forth in Section 3.4
          hereof).  For redemption of a portion of the principal of the
          Bonds pursuant to Section 3.1(d) of the Indenture, the amount to
          be prepaid pursuant to this Section 7.4 in any such event shall
          be 100% of the principal amount of the Bonds being redeemed plus
          accrued interest to the date fixed for redemption.

          Section 7.5.   Obligation to Prepay the Note for Mandatory
          Sinking Fund Redemptions.  The Company shall have, and hereby
          accepts, the obligation to prepay the principal of the Note in
          part by paying to the Trustee an amount sufficient to redeem the
          portion of the Bonds then outstanding and subject to mandatory
          sinking fund redemption pursuant to Section 3.1(e) of the
          Indenture, in the manner, at the redemption prices from the
          sources and on the dates specified in Section 3.1(e) of the
          Indenture.  So long as the Letter of Credit is in effect, and to
          the extent that Available Moneys described in clauses (a) and (b)
          of Section 6.4 of the Indenture are not on deposit in the Bond
          Fund and available to prepay the principal of and accrued
          interest on the Note under this Section 7.5, the Trustee shall,
          in accordance with Section 6.4 of the Indenture, draw upon the
          Letter of Credit to prepay the principal of and accrued interest
          on the Note payable under this Section 7.5 in accordance with the
          terms of the Letter of Credit.

          Section 7.6.   Redemption of the Bonds.  To exercise an option
          granted to the Company by this Article VII, the Company shall
          give written notice to the Issuer, the Trustee and the Bank,
          which notice shall specify therein the date upon which prepayment
          of the Note (or a portion thereof) will be made, which date shall
          be not less than forty-five (45) days from the date the notice is
          mailed, except in the case of Section 7.1, Section 7.4 or Section
          7.5 hereof, and shall specify that all of the principal amount of
          the Note or a specified portion thereof is to be so prepaid. The
          Issuer has directed the Trustee to take forthwith all steps
          (other than the payment of the money required to redeem the
          Bonds) necessary under the applicable provisions of the Indenture
          to effect the redemption of the Bonds (or a portion thereof) in
          amounts equal to the amount of the principal of the Note so
          prepaid as provided in this Article VII.


                                    Article VIII
                                Financing Statements 


          The Company will, at its expense, take all necessary action to
          maintain and preserve the lien and security interest of the
          Indenture so long as any Bond remains outstanding.

          The Company will, forthwith after the execution and delivery of
          the Indenture and thereafter from time to time, cause any
          financing statements in respect of the Indenture to be filed,
          registered and recorded in such manner and in such places as may
          be required by law in order to publish notice of and fully to
          perfect and protect the lien and security interest created
          thereby; and from time to time will perform or cause to be
          performed any other act as provided by law and will file or cause
          to be filed any and all continuation statements and further
          instruments that may be required by law to maintain and preserve
          the lien and security interest of the Indenture.  Except to the
          extent it is exempt therefrom, the Company will pay or cause to
          be paid all filing, registration and recording fees incident to
          such filing, registration and recording, and all expenses
          incident to the preparation, execution and acknowledgment of such
          instruments of further assurance, and all Federal or State fees
          and other similar fees, duties, imposts, assessments and charges
          arising out of or in connection with the execution and delivery
          of the Indenture, said financing statements and such instruments
          of further assurance.

                                     Article IX
                                    Miscellaneous

          Section 9.1.   Notices. All notices, certificates or other
          communications shall be sufficiently given and shall be deemed
          given when the same are (i) deposited in the United States mail
          and sent by first class mail, postage prepaid, or (ii) delivered,
          in each case, to the parties at the addresses set forth below or
          at such other address as a party may designate by notice to the
          other parties: if to the Issuer, at 25 High Street, Morris,
          Illinois 60450, Attention:  Chairman; if to the Company, at 1000
          East Niagra Street, Tonawanda, New York 14156, Attention:  Chief
          Financial Officer; if to the Trustee, at 33 North LaSalle Street,
          Chicago, Illinois 60690, Attention:  Corporate Trust Department;
          if to the Bank, at 2300 Main Place Tower, Buffalo, New York
          14202, Attention:  Alan Boyce; and if to the Remarketing Agent,
          at 100 Park Avenue, New York, New York 10017, Attention: 
          Municipal Finance Department.  A duplicate copy of each notice,
          certificate or other communication given hereunder by either the
          Issuer or the Company to the other shall also be given to the
          Trustee, the Remarketing Agent and the Bank.

          Section 9.2.   Assignments.  This Agreement may not be assigned
          by either party without the consent of the other and the Trustee
          and the Bank, except that the Issuer shall assign and pledge to
          the Trustee its right, title and interest in and to this
          Agreement as provided by Section 4.4 of this Agreement, and the
          Company may without any consent assign to any surviving,
          resulting or transferee corporation its rights under this 
          Agreement as provided in Section 5.2 of this Agreement.

          Section 9.3.   Severability.  If any provision of this Agreement
          shall be held or deemed to be or shall, in fact, be illegal,
          inoperative or unenforceable, the same shall not affect any other
          provision or provisions herein contained or render the same
          invalid, inoperative or unenforceable to any extent whatsoever.

          Section 9.4.   Execution of Counterparts.  This Agreement may be
          simultaneously executed in several counterparts, each of which
          shall be an original and all of which shall constitute but one
          and the same instrument; provided, however, that for purposes of
          perfecting a security interest in this Agreement by the Trustee
          under Article 9 of the Uniform Commercial Code of the State, only
          the counterpart assigned, pledged and delivered to the Trustee
          shall be deemed the original.

          Section 9.5.   Amounts Remaining in Any Fund or with Trustee.  It
          is agreed by the parties hereto that after payment in full of (i)
          the principal of, premium, if any, and interest on the Bonds,
          (ii) the fees, charges, and expenses of the Issuer, the Trustee
          and the Remarketing Agent in accordance herewith and with the
          Indenture and the Remarketing Agreement (the payment of which
          fees, charges and expenses shall be evidenced by a written
          certification of the Company that it has fully paid all such
          fees, charges and expenses), and (iii) all other amounts required
          to be paid under this Agreement, the Note, the Indenture, the
          Remarketing Agreement and the Tax Exemption Certificate and
          Agreement, any amounts remaining in any fund or account
          maintained under this Agreement, the Indenture or the Tax
          Exemption Certificate and Agreement and not applied to the
          principal of, premium, if any, and interest on the Bonds shall
          belong to and be paid to the Company by the Trustee; provided,
          that if the Trustee shall have drawn under the Letter of Credit,
          the Trustee shall request a written statement from the Bank as to
          whether or not the Bank has been reimbursed by the Company for
          any and all such drawings, and if the Bank has not been
          reimbursed by the Company for any and all such drawings under the
          Letter of Credit (other than reimbursement for a drawing under
          the Letter of Credit to purchase Bonds tendered or deemed to be
          tendered for purchase pursuant to Section 4.1 or Section 4.2 of
          the Indenture, which reimbursement is not due and owing under the
          Letter of Credit Agreement), such amounts remaining in the Bond
          Fund or the Bond Purchase Fund shall, upon written notice from
          the Bank that the Company has not reimbursed the Bank under the
          Letter of Credit Agreement for any such drawing under the Letter
          of Credit (which notice shall state the unreimbursed amount),
          belong to and be paid to the Bank by the Trustee to the extent
          that the Company has not so reimbursed the Bank.

          Section 9.6.   Amendments, Changes and Modifications.  Except as
          otherwise provided in this Agreement or the Indenture, subsequent
          to the initial issuance of the Bonds and prior to their payment
          in full, this Agreement may not be effectively amended, changed, 
          modified, altered or terminated without the written consent of
          the Trustee, and, while the Letter of Credit is in effect, the
          Bank.

          Section 9.7.   Governing Law.  This Agreement shall be governed
          exclusively by and construed in accordance with the applicable
          laws of the State.

          Section 9.8.   Authorized Company Representative.  Whenever under
          the provisions of this Agreement the approval of the Company is
          required or the Company is required to take some action at the
          request of the Issuer, the Trustee or the Bank, such approval or
          such request shall be given for the Company by the Authorized
          Company Representative, and the Issuer, the Trustee and the Bank
          shall be authorized to act on any such approval or request and
          neither party hereto shall have any complaint against the other
          or against the Trustee or the Bank as a result of any such action
          taken.

          Section 9.9.   Term of This Agreement.  This Agreement shall be
          in full force and effect from the date hereof, and shall continue
          in effect until the payment in full of all principal of, premium,
          if any, and interest on the Bonds, or provision for the payment
          thereof shall have been made pursuant to Article VIII of the
          Indenture, all fees, charges, indemnities and expenses of the
          Issuer, the Trustee and the Remarketing Agent have been fully
          paid or provision made for such payment (the payment of which
          fees, charges, indemnities and expenses and attorneys' fees and
          expenses shall be evidenced by a written certification of the
          Company that it has fully paid all such fees, charges,
          indemnities and expenses) and all other amounts due hereunder and
          under the Note, the Remarketing Agreement and the Tax Exemption
          Certificate and Agreement have been duly paid or provision made
          for such payment.  All representations, certifications and
          covenants by the Company as to all matters affecting the
          tax-exempt status of the interest on the Series 1996-A Bonds
          shall survive the termination of this Agreement.

          Section 9.10.  Binding Effect.  This Agreement shall inure to the
          benefit of and shall be binding upon the Issuer, the Company and
          their respective successors and assigns; subject, however, to the
          limitations contained in Sections 4.4 and 5.2 of this Agreement.
          Section 9.11.  References to Bank and Letter of Credit.  At any
          time subsequent to the Stated Termination Date (as defined in the
          Letter of Credit), but only upon satisfaction of all
          Reimbursement Obligations, all references to the Bank and the
          Letter of Credit shall be ineffective.   

          In Witness Whereof, the Issuer and the Company have caused this
          Agreement to be executed in their respective names and attested
          by their duly authorized officers and sealed, all as of the date
          first above written.

                                             Upper Illinois River Valley
                                             Development Authority

          (Seal)                             By:  James Washburn
                                                  Chairman
          Attest:  William Steep
                    Secretary


                                             Exolon-ESK Company

                                             By:  Michael H. Bieger
                                                  Chief Financial Officer/
                                                  Vice President


          (Seal)


          Attest:  Nancy E. Gates
                    Secretary 





          The right, title and interest of the Upper Illinois River Valley
          Development Authority, in and to the amounts receivable hereunder
          (except for the rights of said Authority under Sections 4.2(b),
          5.3 and 6.3 hereof and the rights to make determinations and
          receive notices as herein provided) have been assigned and
          pledged to American National Bank and Trust Company of Chicago,
          as Trustee, pursuant to the Indenture of Trust dated as of
          December 1, 1996, from the Upper Illinois River Valley
          Development Authority, to said Trustee.  For purposes of Article
          9 of the Illinois Uniform Commercial Code, the counterpart of
          this Agreement assigned, pledged and delivered to said Trustee
          shall be deemed the original. 




                                      Exhibit A
                               Description of Project

          The Project consists of the acquisition of land, the construction
          of an approximately 25,000 square-foot building and related
          improvements and the acquisition of machinery, equipment and
          related property to be installed therein, all constituting a
          facility for the cleansing of sour gas containing hydrogen
          sulphide and for the disposal of sulphur and silica sand incident
          to the existing silicon carbide manufacturing facilities of the
          Company, to be owned and operated by the Company and to be
          located within the corporate limits of the Village of Hennepin,
          Illinois, on ESK Road, County Road 875E, approximately 3 miles
          north of Route 71 in Hennepin, Illinois. 



                                      Exhibit B
                                 Exolon-ESK Company
                                   Promissory Note

          For Value Received, Exolon-ESK Company, a Delaware corporation
          (the "Company"), hereby promises to pay to the order of the Upper
          Illinois River Valley Development Authority, or its successors
          and assigns (the "Issuer"), in lawful money of the United States
          of America in Federal or other immediately available funds at the
          principal corporate trust office of American National Bank and
          Trust Company of Chicago, as Trustee (the "Trustee"), the
          principal amount of Thirteen Million Dollars ($13,000,000),
          payable in installments on December 1, 2021, except as the
          provisions hereinafter set forth with respect to prepayment may
          become applicable hereto, together with interest on the unpaid
          principal amount hereof from the date hereof at such rates equal
          to the interest rates from time to time borne by the Bonds (as
          hereinafter defined), calculated during the Weekly Rate Period or
          the Monthly Rate Period (as each term is defined in the Agreement
          hereinafter referred to) on the basis of a calendar year
          consisting of 365 or 366 days, as the case may be, and calculated
          on the actual number of days elapsed, and calculated during the
          Adjustable Rate Period or the Fixed Rate Period (as each term is
          defined in the Agreement hereinafter referred to) on the basis of
          a calendar year consisting of 360 days of twelve (12) thirty-day
          months, payable in lawful money of the United States of America
          in Federal or other immediately available funds during said
          Weekly Rate Period or said Monthly Rate Period on January 2,
          1997, and on the first Business Day (as defined in said
          Agreement) of each calendar month thereafter, until the earlier
          of the date of the commencement of said Adjustable Rate Period or
          said Fixed Rate Period or the date on which said principal amount
          is paid, and during said Adjustable Rate Period or said Fixed
          Rate Period on the first day of the June or December immediately
          following the commencement of said Adjustable Rate Period or said
          Fixed Rate Period and on the first day of each June and December
          thereafter; provided, that the portion of the principal of this
          Promissory Note corresponding to the outstanding principal amount
          of the Series 1996-A Bonds (as hereinafter defined), shall bear
          interest at the interest rate from time to time established for
          said Series 1996-A Bonds, and the portion of the principal of
          this Promissory Note corresponding to the outstanding principal
          amount of the Series 1996-B Bonds (as hereinafter defined) shall
          bear interest at the interest rate from time to time established
          for said Series 1996-A Bonds.

          This Promissory Note is issued pursuant to the Loan Agreement
          dated as of December 1, 1996, by and between the Issuer and the
          Company (the "Agreement"), and is issued in consideration of the
          loan made thereunder and to evidence the obligations of the
          Company set forth in Section 4.2(a) of the Agreement.  The
          Company covenants and agrees that the payments of principal
          hereof and premium, if any, and interest hereon will be
          sufficient to enable the Issuer to pay when due the principal of, 
          premium, if any, and interest on its Variable Rate Demand Solid
          Waste Disposal Revenue Bonds, Series 1996-A (Exolon-ESK Company
          Project) in the aggregate principal amount of $8,405,000 (the
          "Series 1996-A Bonds") and its Taxable Variable Rate Demand Solid
          Waste Disposal Revenue Bonds, Series 1996-B (Exolon-ESK Company
          Project) in the aggregate principal amount of $4,595,000 (the
          "Series 1996-B Bonds," and, together with the Series 1996-A
          Bonds, the "Bonds").

          Each payment of principal of, premium, if any, and interest on
          this Promissory Note shall at all times be sufficient to pay the
          total amount of principal of (whether at maturity or upon
          acceleration or redemption prior to maturity), premium, if any,
          and interest on the Bonds on the same date.  The total payments
          to be made by the Company hereunder shall be sufficient to pay
          when due the principal of (whether at maturity or upon
          acceleration or redemption prior to maturity) premium, if any,
          and interest on the Bonds; provided, that the Excess Amount (as
          hereinafter defined) held by the Trustee (as defined in the
          Agreement) in the Bond Fund (as defined in the Agreement) on a
          payment date shall be credited against the payment due on such
          date; and provided further, that, subject to the provisions of
          the immediately following sentence, if at any time the amount
          held by the Trustee in said Bond Fund should be sufficient (and
          remain sufficient) to pay on the dates required the principal of,
          premium, if any, and interest on the Bonds then remaining unpaid,
          the Company shall not be obligated to make any further payments
          under the provisions of this Promissory Note.  Notwithstanding
          the provisions of the preceding sentence, if on any date the
          Excess Amount held by the Trustee in said Bond Fund is
          insufficient to make the then required payments of principal
          (whether at maturity or upon redemption prior to maturity or
          acceleration), premium, if any, and interest on the Bonds on such
          date, the Company shall forthwith pay such deficiency.  The term
          "Excess Amount" as of any interest payment date shall mean the
          amount in said Bond Fund on such date in excess of the amount
          required for the payment of the principal of the Bonds which
          theretofore has matured at maturity or on a date fixed for
          redemption and premium, if any, on such Bonds in all cases where
          Bonds have not been presented for payment and paid, or for the
          payment of interest which has theretofore come due in all cases
          where interest checks have not been presented for payment and
          paid.  Any moneys derived from a drawing under the Letter of
          Credit (as defined in the Agreement) shall constitute a credit
          against the obligation of the Company to make a corresponding
          payment hereunder, as provided in Section 4.2(f) of the
          Agreement.

          This Promissory Note is entitled to the benefits and is subject
          to the conditions of the Agreement.  The obligations of the
          Company to make the payments required hereunder shall be absolute
          and unconditional without any defense or right of set-off,
          counterclaim or recoupment by reason of any default by the Issuer
          under the Agreement or under any other agreement between the 
          Company and the Issuer or the Trustee, or out of any indebtedness
          or liability at any time owing to the Company by the Issuer or
          said Trustee, or for any other reason.

          This Promissory Note is subject to mandatory prepayment and
          optional prepayment as a whole or in part, as provided in Article
          VII of the Agreement.

          In certain events, on the conditions, in the manner and with the
          effect set out in the Agreement, the principal installments of
          this Promissory Note may be declared due and payable before the
          stated maturity thereof, together with accrued interest thereon. 
          Reference is hereby made to the Agreement for a complete
          statement of the terms and conditions under which the maturity of
          the principal installments of this Promissory Note may be
          accelerated.

          In Witness Whereof, the Company has caused this Promissory Note
          to be duly executed, attested, sealed and delivered as of
          December 19, 1996.

                                             Exolon-ESK Company

                                             By:  Michael H. Bieger
                                                  Chief Financial Officer/
                                                  Vice President
          (Seal)


          Attest:  Nancy E. Gates
                     Secretary 




                                     Endorsement

          Pay, without recourse or warranty, to the order of American
          National Bank and Trust Company of Chicago, as Trustee under the
          Indenture of Trust dated as of December 1, 1996, from the
          undersigned to said trustee.

                                        Upper Illinois River Valley 
                                        Development Authority
           


                                        By:  James Washburn
                                             Chairman
          (Seal)


          Attest:  William Steep
                    Secretary 





                                      Exhibit C

                                  Legal Description 





                                      Exhibit D
                             Requisition No. ___________

          American National Bank and Trust Company of Chicago, as Trustee
          Chicago, Illinois  60690

          Re:       Upper Illinois River Valley Development Authority
                    $8,405,000 Variable Rate Demand    Solid Waste Disposal
                    Revenue Bonds, Series 1996-A  (Exolon-ESK Company
                    Project) (the "Series 1996-A Bonds")and $4,595,000
                    Variable Rate Demand Solid Waste Disposal Revenue
                    Bonds, Series 1996-B (Exolon-ESK Company Project) (the
                    "Series 1996-B Bonds")

          Ladies and Gentlemen:

          This Requisition is submitted pursuant to the provisions of
          Section 3.3 of a Loan Agreement dated as of December 1, 1996 (the
          "Agreement") by and between the Upper Illinois River Valley
          Development Authority (the "Issuer") and Exolon-ESK Company (the
          "Company").  The terms used herein have the same meanings as when
          used in the Agreement, except where the context otherwise
          requires.

          The Company hereby requests that on ______________, the Trustee
          pay to the payee named in paragraph (b) below from funds held in
          the Acquisition and Construction Fund the amount specified in
          paragraph (c) below.  In support of this request, the Company
          states as follows:

               (a)  The cost of the facilities to which the payment relates
          has been properly incurred and is a proper charge against the
          Acquisition and Construction Fund.

               (b)  The Payee is __________________ whose address is
          _________________ attention:  ____________________.

               (c)  The amount requested to be paid is $__________________.

               (d)  None of the items for which the payment is proposed to
          be made has formed the basis for any payment heretofore made from
          the Acquisition and Construction Fund.

               (e)  Each of the items for which the payment is proposed to
          be made is or was necessary or appropriate in connection with the
          Project.

               (f)  After giving effect to this Requisition, the amount
          remaining in the Acquisition and Construction Fund, the
          reasonable estimate of investment income thereon, and funds of
          the Company available for such purpose will be sufficient to pay
          the cost of completing the Project.

               (g)  After giving effect to this Requisition, all payments
          of Costs of Issuance paid for out of Series 1996-A Bond proceeds 
          does not exceed $________.

               (h)  After giving effect to this Requisition, at least 95%
          of the proceeds of the Series 1996-A Bonds to be disbursed from
          Account A of the Acquisition and Construction Fund, including the
          amounts requested herein to be disbursed, will be used to provide
          (i) land or depreciable property of a character subject to the
          allowance for depreciation under the Internal Revenue Code of
          1986, as amended (the "Code"), and (ii) qualified "solid waste
          disposal facilities," within the meaning of Section 142(a)(6) of
          the Code.

          In accordance with the provisions of the Agreement, the Company
          has caused this Requisition to be signed and verified on its
          behalf by its duly authorized representative this ______ day of
          ________________, 19___.


          Exolon-ESK Company


           By
                Authorized Company Representative


          Approved:

          The Chase Manhattan Bank, N.A.



          By

          Its