<PAGE>

                                                                Exhibit 10

                                                                [EXECUTION COPY]


                               AMENDMENT NO. 1 TO
                      AMENDED AND RESTATED CREDIT AGREEMENT


         AMENDMENT dated as of March 31, 1999 to the Amended and Restated Credit
Agreement dated as of December 11, 1998 (the "Credit Agreement") among POLAROID
CORPORATION (the "Company"), the LENDERS party thereto (the "Lenders"), MORGAN
GUARANTY TRUST COMPANY OF NEW YORK, as Administrative Agent and Collateral Agent
(the "Agent"), and BANKBOSTON, N.A., a Co-Agent.

                              W I T N E S S E T H :

         WHEREAS, pursuant to Section 5.21 of the Credit Agreement, the parties
hereto desire to amend the Credit Agreement to include certain covenants granted
to the holders of the Company's Bonds (as defined below) and to make certain
other changes relating to the Company's Sterling Dry Imaging Investments (as
defined below);

         NOW, THEREFORE, the parties hereto agree as follows:

         SECTION 1. DEFINED TERMS; REFERENCES. Unless otherwise specifically
defined herein, each term used herein which is (i) defined in the Credit
Agreement shall have the meaning assigned to such term in the Credit Agreement
and (ii) defined in both the Credit Agreement and the Supplemental Indenture has
the meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall, after this Amendment becomes effective,
refer to the Credit Agreement as amended hereby.

         SECTION 2.  AMENDMENTS TO DEFINITIONS.  (a) Section 1.01 of the 
Credit Agreement is amended by inserting, in their appropriate alphabetical 
position, the following definitions:

                  "Affiliate Transaction" has the meaning set forth in Section
         5.23.

                  "Attributable Debt" in respect of a sale and leaseback 
         transaction means, at the time of determination, the present value 
         of the obligation of the lessee for net rental payments during the 
         remaining term of the lease included in such sale and leaseback 
         transaction including any period for

<PAGE>



         which such lease has been extended or may, at the option of the
         lessor, be extended. Such present value shall be calculated using a
         discount rate equal to the rate of interest implicit in such
         transaction, determined in accordance with GAAP.

                  "Bonds" means the 11 1/2% Notes due 2006 issued by the Company
         in an aggregate principal amount of $275,000,000. 

                  "Supplemental Indenture" means the First Supplemental 
         Indenture dated as of February 17, 1999 by and between the Company 
         and State Street Bank and Trust Company, as Trustee, and relating to 
         the issuance and sale of the Bonds, as in effect on the date hereof, 
         which is supplemental to the Indenture dated as of January 9, 1997 
         by and between the Company and State Street Bank and Trust Company, 
         as Trustee. 

                  "Sterling Dry Imaging Investments" means the equity 
         interests owned by the Company consisting of (i) 14% of the common 
         stock of SDI Holding Corp. and (ii) 100% of the preferred stock of 
         Sterling Dry Imaging Systems, Inc., a subsidiary of SDI Holding Corp.

         (b)      Section 1.01 of the Credit Agreement is amended by 
inserting at the end thereof the following:

         "The following terms, as used herein, have the meanings set forth in
the Supplemental Indenture as in effect on the date hereof:

                  Capital Stock

                  Disqualified Stock

                  Equity Interests

                  Fixed Charge Coverage Ratio (and, for purposes of this
                  definition only, all related definitions contained therein)

                  Stated Maturity"

         SECTION 3. DEFINITION OF RESTRICTED PAYMENT. The definition of 
"Restricted Payment" in Section 1.01 of the Credit Agreement is amended by 
adding "and (iii) any payment on or with respect to or any purchase, 
redemption, defeasance, acquisition or retirement for value of any Permitted 
Subordinated Debt, except the scheduled payment of interest or principal at 
the Stated Maturity thereof" immediately after clause (ii) therein and 
replacing the "or" immediately before "(ii)" with a comma.

                                       2

<PAGE>


         SECTION 4. DEFINITION OF CORPORATE RATING. The definition of "Long-
Term Debt Rating" is amended to be named "Corporate Rating" and to read as
follows:

                  "Corporate Rating" means at any time (i) with respect to
         Moody's, its senior implied rating of the Company at such time or, if
         Moody's does not maintain a senior implied rating of the Company at
         such time, the rating assigned by Moody's at such time to senior
         unsecured long-term debt securities of the Company without third-party
         credit enhancement and (ii) with respect to S&P, its corporate credit
         rating of the Company at such time or, if S&P does not maintain a
         corporate credit rating of the Company at such time, the rating
         assigned by S&P at such time to the senior unsecured long-term debt
         securities of the Company without third-party credit enhancement."

         SECTION 5. AMENDMENT TO RESTRICTED PAYMENTS. Section 5.10 of the Credit
Agreement is amended by adding "(other than Restricted Payments described in
clause (iii) of the definition thereof)" immediately after the words "make any
Restricted Payment" in subsection (b) thereof and by adding the following new
subsection (c) thereto:

                  "(c) Neither the Company nor any Subsidiary will declare or
         make any Restricted Payment after December 31, 1998 unless no Default
         has occurred and is continuing or would result after giving effect
         thereto."

         SECTION 6.  LIMITATION ON INTERCOMPANY DEBT.  Clause (a)(ii) of Section
5.11 of the Credit Agreement is amended to read as follows:

                  "(ii) Debt owing to the Company or to a Subsidiary; PROVIDED
         that Debt owing by the Company to a Subsidiary that is not a Subsidiary
         Guarantor shall be permitted by this clause (ii) only to the extent
         that such Debt is expressly subordinated to the prior payment in full
         in cash of the principal of and interest (including Post-Petition
         Interest) on the Loans and all other obligations of the Company under
         the Financing Documents on terms and conditions reasonably satisfactory
         to the Required Lenders;"

         SECTION 7.  TRANSACTIONS WITH AFFILIATES.  Article 5 of the Credit
Agreement is amended to add an additional Section to read as follows:

                  "SECTION 5.23. TRANSACTION WITH AFFILIATES. The Company shall
         not, and shall not permit any Subsidiary, to make any payment to, or
         sell, lease, transfer or otherwise dispose of any of its properties or
         assets to, or purchase any property or assets from, or enter into or
         make or amend any transaction, contract, agreement understanding, loan,
         advance or

                                       3

<PAGE>



         Guarantee with, or for the benefit of, any Affiliate (each, an 
         "Affiliate Transaction"), unless (i) such Affiliate Transaction is 
         on terms that are no less favorable to the Company or the relevant 
         Subsidiary than those that would have been obtained in a comparable 
         transaction by the Company or such Subsidiary with an unrelated 
         Person; and (ii) the Company delivers to the Administrative Agent: 
         (A) with respect to any Affiliate Transaction or series of related 
         Affiliate Transactions involving aggregate consideration of less 
         than $10,000,000, a certificate of the Company's chief executive 
         officer or chief financial officer certifying that such Affiliate 
         Transaction complies with this Section 5.23, (B) with respect to any 
         Affiliate Transaction or series of related Affiliate Transaction 
         involving aggregate consideration equal to or in excess of 
         $10,000,000 and less than $50,000,000, a certificate of the 
         Company's chief executive officer or chief financial officer, 
         approved by the Company's Board of Directors, certifying that such 
         Affiliate Transaction complies with this Section 5.23 and that such 
         Affiliate Transaction has been approved by a majority of the 
         disinterested members of the Board of Directors; and (C) with 
         respect to any Affiliate Transaction or series of related Affiliate 
         Transactions involving aggregate consideration in excess of 
         $50,000,000, an opinion as to the fairness to the Lenders of such 
         Affiliate Transaction from a financial point of view issued by an 
         accounting, appraisal or investment banking firm of national 
         standing.

         The following items shall not be deemed to be Affiliate Transactions
         and, therefore, will not be subject to the provisions of the prior
         paragraph: (i) any employment agreement entered into by the Company or
         any of its Subsidiaries in the ordinary course of business and
         consistent with the past practice of the Company or such Subsidiary, as
         the case may be; (ii) transactions between or among the Company and/or
         its Subsidiaries; (iii) any sale or other issuance of Equity Interests
         (other than Disqualified Stock) of the Company; (iv) payment of
         reasonable fees and compensation and indemnity on behalf of officers,
         directors, employees and consultants of the Company or any Subsidiary
         of the Company who are not otherwise Affiliates of the Company or the
         Subsidiary, as the case may be; (v) Restricted Payments that are
         permitted by Section 5.10; (vi) reasonable payments, advances or loans
         to employees or consultants for moving, entertainment and travel
         expenses and similar expenditures in the ordinary course of business;
         and (vii) transactions with joint ventures or alliances in
         the ordinary course of business and otherwise in compliance with the
         provisions of this Agreement on terms at least as favorable as might
         reasonably have been obtained at such time from an unaffiliated party."

                                       4

<PAGE>


         SECTION 8.  RESTRICTIONS ON PAYMENTS BY SUBSIDIARIES.  Article 5 of the
Credit Agreement is amended to add an additional Section to read as follows:

                  "SECTION 5.24. RESTRICTIONS ON PAYMENTS BY SUBSIDIARIES. The
         Company will not, and will not permit any of its Subsidiaries to,
         directly or indirectly, create or permit to exist or become effective
         any consensual encumbrance or restriction on the ability of any
         Subsidiary to:

                  (a) pay dividends or make any other distributions on its 
         capital stock to the Company or any of its Subsidiaries, or with 
         respect to any other interest or participation in, or measured by, 
         its profits, or pay any debt owed to the Company or any of its 
         Subsidiaries;

                  (b)   make any loans or advances to the Company or any of 
         its Subsidiaries; or

                  (c)   transfer any of its properties or assets to the 
         Company or any of its Subsidiaries;

         PROVIDED that the preceding restrictions will not apply to 
         encumbrances or restrictions existing under or by reason of (i) Debt 
         outstanding on the date hereof and any amendments, modifications, 
         restatements, renewals, increases, supplements, refundings, 
         replacements or refinancings thereof, PROVIDED that such amendments, 
         modifications, restatements, renewals, increases, supplements, 
         refundings, replacements or refinancings are no more restrictive, 
         taken as a whole, with respect to such dividend and other payment 
         restrictions than those contained in such outstanding Debt; (ii) the 
         Supplemental Indenture; (iii) applicable law; (iv) any instrument 
         governing Debt or Capital Stock of a Person acquired by the Company 
         or any of its Subsidiaries as in effect at the time of such 
         acquisition (except to the extent such Debt was incurred in 
         connection with or in contemplation of such acquisition), which 
         encumbrance or restriction is not applicable to any Person, or the 
         properties or assets of any Person, other than the Person, or the 
         property or assets of the Person, so acquired, PROVIDED that, in the 
         case of Debt, such Debt was permitted to be incurred pursuant to 
         Section 5.11; (v) customary non-assignment provisions in leases 
         entered into in the ordinary course of business; (vi) capital 
         leases, mortgage financings or purchase money obligations for 
         property acquired in the ordinary course of business that impose 
         restrictions on the property so acquired of the nature described in 
         clause (c) of the preceding paragraph; (vii) any agreement for the 
         sale or other disposition of a Subsidiary that restricts 
         distributions by that Subsidiary Guarantor pending its sale or other 
         disposition; (viii) Debt incurred to refund, replace or refinance 
         other

                                       5

<PAGE>



         Debt incurred in compliance with this Agreement, PROVIDED that the 
         restrictions contained in the agreements governing such Debt are no 
         more restrictive, taken as a whole, than those contained in the 
         agreements governing Debt being refinanced; (ix) Liens securing Debt 
         that limit the right of the debtor to dispose of the assets subject 
         to such Lien; (x) provisions with respect to the distribution or 
         disposition of assets or property in joint venture agreements, asset 
         sale agreements, stock sale agreements and other similar agreements 
         entered into in the ordinary course of business; (xi) restrictions 
         on cash or other deposits or net worth imposed by customers under 
         contracts entered into in the ordinary course of business; and (xii) 
         Debt under the Financing Documents." 

         SECTION 9. SALE-LEASEBACK TRANSACTIONS. Section 5.14 of the Credit
Agreement is amended by adding "(b)" immediately before the first sentence and
by inserting the following Section 5.14(a) immediately prior to Section 5.14(b):

                  "(a) The Company will not, and will not permit any of its
         Subsidiaries to, enter into any sale and leaseback transaction;
         PROVIDED that the Company or any Subsidiary may enter into a sale and
         leaseback transaction if:

                   (i) The Company, or that Subsidiary, as applicable, could 
         have incurred Debt in an amount equal to the Attributable Debt 
         relating to such sale and leaseback transaction under (A) the Fixed 
         Charge Coverage Ratio test in the first paragraph of Section 15(c) 
         of the Supplemental Indenture or (B) Section 15(c)(xii) of the 
         Supplemental Indenture, PROVIDED that, in the case of this clause 
         (B), the aggregate amount of Attributable Debt relating to all such 
         sale and leaseback transactions shall not exceed $50,000,000 at any 
         one time outstanding;

                   (ii) the gross cash proceeds of that sale and leaseback 
         transaction are at least equal to the fair market value of the 
         property that is the subject of the sale and leaseback transaction; 
         and

                   (iii) the transfer of assets in that sale and leaseback 
         transaction is permitted by this Agreement, and the Company or such 
         Subsidiary applies the proceeds of such transaction in compliance 
         with Section 2.17 of this Agreement."

         SECTION 10.  ADDITIONAL EVENTS OF DEFAULT.  Section 6.01(b) is 
amended to add after the reference to Section 5.20 thereof, ", or in Section 
5.23 or 5.24".

                                       6

<PAGE>


         SECTION 11. CALCULATION OF INTEREST COVERAGE RATIO, DEBT TO EBITDA
RATIO. The Lenders hereby agree that for purposes of calculating compliance with
the covenants contained in Section 5.07 and 5.08(a) of the Credit Agreement,
Consolidated Net Income for any period shall be calculated on a PRO-FORMA basis
excluding any non-cash charges of up to $40,000,000, in the aggregate, taken
after December 31, 1998 and before December 31, 1999, for losses incurred by the
Company with respect to the sale or other disposition of its equity interests in
the Sterling Dry Imaging Investments or any write-down in the carrying value
thereof.

         SECTION 12. AMENDMENT OF PRICING SCHEDULE. The Pricing Schedule is
amended to replace "Long-Term Debt Ratings" in the second paragraph thereof with
the words "Corporate Ratings".

         SECTION 13. REPRESENTATIONS OF BORROWER. The Borrower represents and
warrants that (i) the representations and warranties of the Borrower set forth
in Article 4 of the Credit Agreement will be true on and as of the Amendment
Effective Date and (ii) no Default will have occurred and be continuing on such
date.

         SECTION 14. CONSENT BY GUARANTORS. By its signature below, each
Guarantor hereby consents to this Amendment, and acknowledges that this
Amendment shall not alter, release, discharge or otherwise affect any of its
obligations under the Credit Agreement or any Financing Document (as defined in
the Credit Agreement), and hereby ratifies and confirms all of the Financing
Documents (as so defined) to which it is a party.

         SECTION 15.  GOVERNING LAW.  This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.

         SECTION 16. COUNTERPARTS. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

         SECTION 17.  EFFECTIVENESS. This Amendment shall become effective 
as of the date hereof on the date when the following conditions are met (the 
"Amendment Effective Date"):

                   (a) the Agent shall have received from each of the 
         Borrower, each Guarantor and the Required Lenders a counterpart 
         hereof signed by such party or facsimile or other written 
         confirmation (in form satisfactory to the Agent) that such party has 
         signed a counterpart hereof; and

                                       7

<PAGE>


                   (b) the Agent shall have received an amendment fee for the 
         account of each Lender that has evidenced its agreement hereto as 
         provided in clause (a) by 5:00 p.m. (New York City time) on the 
         later of (i) April 2, 1999 and (ii) the date the Agent issues a 
         notice to the Lenders saying that the Required Lenders have so 
         evidenced their agreement hereto, in an amount equal to 0.05% of 
         such Lender's Commitment.

                                       8

<PAGE>



         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first above written.

                              POLAROID CORPORATION


                              By:
                                  -------------------------------------
                                    Name:
                                    Title: 
                                    784 Memorial Drive
                                    Cambridge, Massachusetts 02139
                                    Attention:  Treasurer
                                    Facsimile number:


                              INNER CITY, INC.


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


                              POLAROID ASIA PACIFIC LIMITED


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


                              POLAROID CARIBBEAN
                                     CORPORATION


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


                              POLAROID DIGITAL SOLUTIONS, INC.


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



<PAGE>



                              POLAROID EYEWEAR, INC.


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


                              POLAROID ID SYSTEMS, INC.


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


                              POLAROID MALAYSIA LIMITED


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


                              PRD CAPITAL INC.


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



<PAGE>



                              MORGAN GUARANTY TRUST
                                    COMPANY OF NEW YORK


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


                              ABN AMRO BANK N.V.


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


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


                              BANKBOSTON, N.A.


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


                              TRANSAMERICA BUSINESS CREDIT
                                    CORPORATION


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






<PAGE>



                              FOOTHILL CAPITAL (L.A.)


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


                              DEUTSCHE BANK AG, NEW YORK
                                    AND/OR CAYMAN ISLANDS
                                    BRANCHES


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


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


                              THE FIRST NATIONAL BANK OF
                                    CHICAGO


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


                              SENIOR DEBT PORTFOLIO

                              By:   Boston Management and Research,
                                    as Investment Advisor


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



<PAGE>



                              THE SUMITOMO BANK, LIMITED,
                                    NEW YORK BRANCH


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


                              WACHOVIA BANK, N.A.


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


                              FLEET NATIONAL BANK


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


                              MELLON BANK, N.A.


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


                              TEXTRON FINANCIAL CORPORATION


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






<PAGE>



                              PNC BANK, NATIONAL ASSOCIATION


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


                              KZH STERLING LLC


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

(NY) 27009/480/AMEND/amend1.wp




<PAGE>


                              MORGAN GUARANTY TRUST
                                    COMPANY OF NEW YORK, as
                                    Administrative Agent


                              By:
                                  -------------------------------------
                                    Name:
                                    Title:
                                    60 Wall Street
                                    New York, New York 10260-0060
                                    Attention:  Loan Department
                                    Telex number:  177615 MGT UT
                                    Facsimile number:  212-648-5014


                              BANKBOSTON, N.A., as Co-Agent


                              By:
                                  -------------------------------------
                                    Name:
                                    Title:
                                    100 Federal Street
                                    Mail Stop: 01-10-01
                                    Boston, MA 02110
                                    Attention: Grace A. Barnett
                                    Telex number: 4996527
                                    Facsimile number: 617-434-0601


                              MORGAN GUARANTY TRUST
                                    COMPANY OF NEW YORK, as
                                    Collateral Agent


                              By:
                                  -------------------------------------
                                    Name:
                                    Title:
                                    c/o  J.P. Morgan Services Inc.
                                         500 Stanton Christiana Road
                                         Newark, Delaware 19713-2107
                                         Attention: Jeannie Mattson
                                         Facsimile number: (302) 634-1852