<PAGE>   1
                                                                  EXECUTION COPY





                                CREDIT AGREEMENT

                            Dated as of July 30, 1998

                                      Among

                                 HANDY & HARMAN
                        HANDY & HARMAN OF CANADA, LIMITED
                          HANDY & HARMAN EUROPE LIMITED
                       RIGBY-MARYLAND (STAINLESS) LIMITED
                                       and
                            INDIANA TUBE DANMARK A/S

                                  as Borrowers

                                       and

                 THE INITIAL LENDERS, INITIAL ISSUING BANKS AND
                          SWING LINE BANK NAMED HEREIN

          as Initial Lenders, Initial Issuing Banks and Swing Line Bank

                                       and

                               CITICORP USA, INC.

                               as Collateral Agent

                                       and

                               CITICORP USA, INC.

                             as Administrative Agent




<PAGE>   2

                          T A B L E O F C O N T E N T S


Section                                                                    Page

                                    ARTICLE I

                        DEFINITIONS AND ACCOUNTING TERMS

1.01.  Certain Defined Terms..................................................1
1.02.  Computation of Time Periods; Other Definitional Provisions............38
1.03.  Accounting Terms......................................................38

                                   ARTICLE II

                              AMOUNTS AND TERMS OF
                       THE ADVANCES, THE LETTERS OF CREDIT
                          AND THE BANKERS' ACCEPTANCES

2.01.  The Advances and the Letters of Credit................................38
2.02.  Making the Advances...................................................41
2.03.  Issuance of and Drawings and Reimbursement Under Letters of Credit....45
2.04.  Drawings of Bankers' Acceptances......................................46
2.05.  Repayment of Advances.................................................50
2.06.  Termination or Reduction of the Commitments...........................53
2.07.  Prepayments...........................................................55
2.08.  Interest..............................................................58
2.09.  Fees..................................................................61
2.10.  Conversion of Advances................................................62
2.11.  Renewal and Conversion of Bankers' Acceptances........................63
2.12.  Increased Costs, Etc..................................................66
2.13.  Payments and Computations.............................................68
2.14.  Taxes.................................................................70
2.15.  Sharing of Payments, Etc..............................................73
2.16.  Use of Proceeds.......................................................74
2.17.  Defaulting Lenders....................................................75

                                   ARTICLE III

                            CONDITIONS OF LENDING AND
                         ISSUANCES OF LETTERS OF CREDIT

3.01.  Conditions Precedent to Initial Extension of Credit...................78



<PAGE>   3


                                       ii


Section                                                                    Page


3.02.  Conditions Precedent to Initial Borrowing by Danmark..................85
3.03.  Conditions Precedent to Each Borrowing, Drawing 
          and Issuance and Renewal...........................................86
3.04.  Determinations Under Section 3.01.....................................87

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

4.01.  Representations and Warranties of the Borrowers.......................88

                                    ARTICLE V

                           COVENANTS OF THE BORROWERS

5.01.  Affirmative Covenants.................................................95
5.02.  Negative Covenants...................................................103
5.03.  Reporting Requirements...............................................115
5.04.  Financial Covenants..................................................120

                                   ARTICLE VI

                                EVENTS OF DEFAULT

6.01.  Events of Default....................................................125
6.02.  Actions in Respect of the Letters of Credit and Bankers' 
          Acceptances upon Default..........................................128

                                   ARTICLE VII

                                COMPANY GUARANTY

SECTION 7.01.  Guaranty.....................................................129
SECTION 7.02.  Guaranty Absolute............................................130
SECTION 7.03.  Waiver.......................................................131
SECTION 7.04.  Continuing Guaranty; Assignments.............................131
SECTION 7.05.  Subrogation..................................................131





<PAGE>   4


                                       iii


Section                                                                    Page


                                  ARTICLE VIII

                                   THE AGENTS

8.01.  Authorization and Action.............................................132
8.02.  Agents' Reliance, Etc................................................132
8.03.  Citicorp and Affiliates..............................................133
8.04.  Lender Party Credit Decision.........................................133
8.05.  Indemnification......................................................133
8.06.  Successor Agents.....................................................135
8.07.  Sub-Agents...........................................................136

                                   ARTICLE IX

                                  MISCELLANEOUS

9.01.  Amendments, Etc......................................................136
9.02.  Notices, Etc.........................................................137
9.03.  No Waiver; Remedies..................................................138
9.04.  Costs and Expenses...................................................138
9.05.  Right of Set-off.....................................................140
9.06.  Binding Effect.......................................................140
9.07.  Assignments and Participations.......................................141
9.08.  Execution in Counterparts............................................144
9.09.  No Liability of the Issuing Banks....................................144
9.10.  Release of Collateral................................................145
9.11.  Jurisdiction, Etc....................................................145
9.13.  Judgment.............................................................146
9.14.  Governing Law........................................................146
9.15.  Substitution of Currency.............................................146
9.16.  Waiver of Jury Trial.................................................147
9.17.  Power of Attorney....................................................147


<PAGE>   5


                                       iv


Section                                                                    Page


SCHEDULES

Schedule I                 -        Commitments and Applicable Lending Offices
Schedule II                -        Inactive Subsidiaries
Schedule 3.01(a)(ix)       -        Good Standing Certificates
Schedule 3.01(a)(xix)      -        Local Counsel
Schedule 4.01(b)           -        Subsidiaries
Schedule 4.01(p)           -        Plans, Multiemployer Plans and Welfare Plans
Schedule 4.01(q)           -        Environmental Disclosure
Schedule 4.01(r)           -        Open Years
Schedule 4.01(t)           -        Existing Debt
Schedule 4.01(u)           -        Surviving Debt
Schedule 4.01(v)           -        Liens
Schedule 4.01(w)           -        Owned Real Property
Schedule 4.01(x)           -        Leased Real Property
Schedule 4.01(y)           -        Investments
Schedule 4.01(z)           -        Intellectual Property
Schedule 5.02(g)           -        Precious Metal Inventory


EXHIBITS

Exhibit A-1       -        Form of Term A Note
Exhibit A-2       -        Form of Term B Note
Exhibit A-3       -        Form of Delayed Draw Note
Exhibit A-4       -        Form of Multicurrency Note
Exhibit A-5       -        Form of Revolving Credit Note
Exhibit A-6       -        Form of Draft
Exhibit B-1       -        Form of Notice of Borrowing
Exhibit B-2       -        Form of Notice of Drawing
Exhibit C         -        Form of Assignment and Acceptance
Exhibit D         -        Form of Security Agreement
Exhibit E         -        Form of Domestic Subsidiary Guaranty
Exhibit F         -        Form of Foreign Subsidiary Guaranty
Exhibit G         -        Form of Mortgage
Exhibit H         -        Form of Canadian Security Agreement
Exhibit I-1       -        Form of Deed of Charge
Exhibit I-2       -        Form of Deed of Charge Over Shares
Exhibit J         -        Form of Solvency Certificate
Exhibit K         -        Form of Opinion of Counsel to the Loan Parties
Exhibit L         -        Form of Opinion of Local Counsel to the Loan Parties



<PAGE>   6


                                        v


Section                                                                    Page

Exhibit M         -        Form of Borrowing Base Certificate
Exhibit N         -        Form of Subordination Agreement
Exhibit O         -        Form of Intercreditor Agreement




<PAGE>   7

                                CREDIT AGREEMENT

                           Dated as of July 30, 1998

                  Handy & Harman, a New York corporation (the "Company"),  Handy
& Harman of Canada,  Limited, an Ontario corporation (the "Canadian  Borrower"),
Handy & Harman Europe Limited, a limited company  incorporated under the laws of
England  and  Wales  ("HHEL"),  Rigby-Maryland  (Stainless)  Limited,  a limited
company  incorporated  under the laws of England and Wales ("Rigby") and Indiana
Tube Danmark A/S, a corporation  organized under the laws of Denmark  ("Danmark"
and  together  with  the  Canadian  Borrower,   HHEL  and  Rigby,  the  "Foreign
Borrowers"),  the banks,  financial institutions and other institutional lenders
listed on the  signature  pages  hereof as the  Initial  Lenders  (the  "Initial
Lenders"), the banks listed on the signature pages hereof as the Initial Issuing
Banks (the  "Initial  Issuing  Banks")  and the Swing Line Bank (as  hereinafter
defined),  Citicorp USA, Inc.  ("Citicorp"),  as collateral agent (together with
any  successor   collateral  agent  appointed   pursuant  to  Article  VII,  the
"Collateral  Agent"),  and Citicorp,  as administrative agent (together with any
successor   administrative   agent  appointed   pursuant  to  Article  VII,  the
"Administrative  Agent") and,  together with the Collateral Agent, the "Agents")
for the Lender Parties (as hereinafter defined), agree as follows:


                                    ARTICLE I

                        DEFINITIONS AND ACCOUNTING TERMS

                  SECTION  1.01.   Certain   Defined  Terms.  As  used  in  this
Agreement,  the following terms shall have the following meanings (such meanings
to be equally  applicable  to both the  singular  and plural  forms of the terms
defined):

                  "Adjusted  EBITDA"  means,  for any period,  the sum,  without
         duplication  and determined on a Consolidated  basis, of (a) EBITDA and
         (b) equity advances and capital  contributions to the Company or any of
         its Subsidiaries  not exceeding  $8,000,000 in any 12-month period from
         WHX Corporation and its Subsidiaries.

                  "Administrative  Agent"  has  the  meaning  specified  in  the
         recital of parties to this Agreement.

                  "Administrative  Agent's  Account"  means  (a) in the  case of
         Advances  denominated  in Dollars,  the  account of the  Administrative
         Agent maintained by the Administrative  Agent at Citibank at its office
         at Two Penn's Way, Suite 200, New Castle,  Delaware 19720,  Account No.
         36852248, Attention: Onat Acet, (b) in the case of Advances denominated
         in any  Foreign  Currency,  the  account  of the  applicable  Sub-Agent
         designated in writing from time to time by the Administrative  Agent to
         the  Borrowers  and the Lender  Parties for such purpose and (c) in any
         such case, such other account of the
<PAGE>   8
                                       2

         Administrative  Agent as is  designated in writing from time to time by
         the  Administrative  Agent to the Borrowers and the Lender  Parties for
         such purpose.

                  "Advance" means a Term A Advance,  a Term B Advance, a Delayed
         Draw Advance,  a Multicurrency  Advance,  a Revolving Credit Advance, a
         Swing Line Advance or a Letter of Credit Advance.

                  "Affiliate"  means,  as to any Person,  any other Person that,
         directly or indirectly,  controls,  is controlled by or is under common
         control with such Person or is a director or executive  officer of such
         Person. For purposes of this definition,  the term "control" (including
         the terms  "controlling",  "controlled  by" and "under  common  control
         with") of a Person means the  possession,  direct or  indirect,  of the
         power to vote 10% or more of the  Voting  Stock  of such  Person  or to
         direct or cause the  direction of the  management  and policies of such
         Person,  whether  through the ownership of Voting Stock, by contract or
         otherwise.

                  "Agents"  has the meaning  specified in the recital of parties
         to this Agreement.

                  "Agreement  Value" means,  for any Hedge Agreement on any date
         of determination,  an amount equal to the greater of (a) the amount, if
         any, that would be payable by any Loan Party or any of its Subsidiaries
         as  the  "settlement  amount"  as  though  such  Hedge  Agreement  were
         terminated  on such date and as though  such Loan  Party or  Subsidiary
         were the defaulting party,  calculated pursuant to the Master Agreement
         (Multi currency - Cross Border), or any successor thereto, published by
         the  International  Swaps and  Derivatives  Association,  Inc.  and (b)
         mark-to-market,  in which the  unrealized  gain (or loss) on such Hedge
         Agreement is calculated as the amount by which the present value of the
         future cash flows to be received  exceeds (or is less than) the present
         value of the  future  cash  flows  to be paid  pursuant  to such  Hedge
         Agreement.

                  "Applicable Lending Office" means, with respect to each Lender
         Party,  such Lender  Party's  Domestic  Lending Office in the case of a
         Base Rate Advance,  such Lender Party's  Eurocurrency Lending Office in
         the case of a Eurocurrency Rate Advance, such Lender Party's Local Rate
         Lending  Office in the case of a Local Rate Advance (other than a Local
         Rate Advance  denominated in Canadian  Dollars) and, in the case of any
         Multicurrency  Advance  denominated  in Canadian  Dollars,  such Lender
         Party's Canadian Domestic Lending Office and, in the case of a Drawing,
         such Lender Party's BA Lending Office.

                  "Applicable  Margin"  means  (a) in  the  case  of the  Term A
         Facility,  the Delayed Draw Facility,  the Multicurrency  Facility, the
         Revolving Credit Facility, Letter of Credit

<PAGE>   9
                                       3

         fees and Drawing Fees, a percentage  per annum  determined by reference
         to the Total Leverage Ratio as set forth below:

<TABLE>
<CAPTION>

          Total Leverage Ratio                 Base Rate Advances/             Eurocurrency             Letter of
                                               Local Rate Advances                 Rate               Credit Fees/
                                                                                 Advances             Drawing Fees
==================================================================================================================
<S>                                                   <C>                         <C>                     <C>  
Level 1
greater than or equal to 4.50:                        1.50%                       2.25%                   2.00%
1.0
------------------------------------------- --------------------------- ------------------------ -----------------
Level 2
less than 4.50:1.00 but greater                       1.25%                       2.00%                   1.75%
than or equal to 4.00:1.00
------------------------------------------- --------------------------- ------------------------ -----------------
Level 3
less than 4.00:1.00 but greater                       1.00%                       1.75%                   1.50%
than or equal to 3.50:1.00
------------------------------------------- --------------------------- ------------------------ -----------------
Level 4
less than 3.50:1.00 but greater                       0.75%                       1.50%                   1.25%
than or equal to 3.00:1.00
------------------------------------------- --------------------------- ------------------------ -----------------
Level 5
less than 3.00:1.00 but greater                       0.50%                       1.25%                   1.00%
than or equal to 2.50:1.00
------------------------------------------- --------------------------- ------------------------ -----------------
Level 6                                               0.25%                       1.00%                   0.75%
-------
less than 2.50:1.00
=========================================== =========================== ======================== =================
</TABLE>

         and (b) in the case of the Term B  Facility,  a  percentage  per  annum
         determined by reference to the Total Leverage Ratio as set forth below:


<PAGE>   10


                                                         4

<TABLE>
<CAPTION>

          Total Leverage Ratio                  Base Rate Advances                 Eurocurrency Rate Advances
==================================================================================================================
<S>                                                    <C>                                    <C>  
Level 1
greater than or equal to 4.50:                         2.00%                                  2.75%
1.0
----------------------------------------  -------------------------------  ---------------------------------------
Level 2
less than 4.50:1.00 but greater                        1.75%                                  2.50%
than or equal to 4.00:1.00
----------------------------------------  -------------------------------  ---------------------------------------
Level 3
less than 4.00:1.00 but greater                        1.50%                                  2.50%
than or equal to 3.50:1.00
----------------------------------------  -------------------------------  ---------------------------------------
Level 4
less than 3.50:1.00 but greater                        1.50%                                  2.25%
than or equal to 3.00:1.00
----------------------------------------  -------------------------------  ---------------------------------------
Level 5
less than 3.00:1.00 but greater                        1.00%                                 2.125%
than or equal to 2.50:1.00
----------------------------------------  -------------------------------  ---------------------------------------
Level 6                                                0.75%                                  2.00%
-------
less than 2.50:1.00
========================================  ===============================  =======================================
</TABLE>

         The Applicable Margin for each Advance shall be determined by reference
         to the  Total  Leverage  Ratio in effect  from time to time;  provided,
         however,  that (A) (x) until the  financial  statements  for the Fiscal
         Year ended December 31, 1998 are delivered pursuant to Section 5.02(b),
         the  Applicable  Margin  shall be at Level 3 and (y) no  change  in the
         Applicable  Margin shall be effective  until the first  Business Day of
         the calendar month commencing  immediately  after the date on which the
         Administrative  Agent receives the financial  statements required to be
         delivered pursuant to Section 5.03(b) or (c), as the case may be, and a
         certificate of a Designated  Officer of the Company  demonstrating  the
         Total  Leverage  Ratio and (B) after the Fiscal Year ended December 31,
         1998,  the  Applicable  Margin  shall  be at Level 1 for so long as the
         Company has not submitted to the  Administrative  Agent the information
         described in clause (A)(y) of this proviso as and when  required  under
         Section 5.03(b) or (c), as the case may be.

                  "Applicable   Percentage"   means  a   percentage   per  annum
         determined by reference to the Total Leverage Ratio as set forth below:


<PAGE>   11


                                        5


          Total Leverage Ratio                 Applicable Percentage
========================================  ===============================
Level 1
greater than or equal to 4.50:                         0.50%
1.0
----------------------------------------  -------------------------------
Level 2
less than 4.50:1.00 but greater                        0.50%
than or equal to 4.00:1.00
----------------------------------------  -------------------------------
Level 3
less than 4.00:1.00 but greater                        0.50%
than or equal to 3.50:1.00
----------------------------------------  -------------------------------
Level 4
less than 3.50:1.00 but greater                       0.375%
than or equal to 3.00:1.00
----------------------------------------  -------------------------------
Level 5
less than 3.00:1.00 but greater                       0.375%
than or equal to 2.50:1.00
========================================  ===============================
Level 6                                                0.25%
less than 2.50:1.00
========================================  ===============================

         The Applicable Percentage shall be determined by reference to the Total
         Leverage Ratio in effect from time to time; provided, however, that (A)
         (x) until the financial  statements  for the Fiscal Year ended December
         31, 1998 are  delivered  pursuant to Section  5.02(b),  the  Applicable
         Percentage  shall be at  Level 3 and (y) no  change  in the  Applicable
         Percentage  shall be  effective  until  the first  Business  Day of the
         calendar  month  commencing  immediately  after  the date on which  the
         Administrative  Agent receives the financial  statements required to be
         delivered pursuant to Section 5.03(b) or (c), as the case may be, and a
         certificate of a Designated  Officer of the Company  demonstrating  the
         Total  Leverage  Ratio and (B) after the Fiscal Year ended December 31,
         1998, the Applicable  Percentage shall be at Level 1 for so long as the
         Company has not submitted to the  Administrative  Agent the information
         described in clause (A)(y) of this proviso as and when  required  under
         Section 5.03(b) or (c), as the case may be.

                  "Appropriate  Lender" means,  at any time, with respect to (a)
         any of the Term A Facility,  Term B Facility,  Delayed  Draw  Facility,
         Multicurrency  Facility or Revolving Credit Facility, a Lender that has
         a Commitment with respect to such Facility at such time,


<PAGE>   12


                                        6

         (b) the Letter of Credit Facility, (i) any Issuing Bank and (ii) if the
         other  Revolving  Credit  Lenders  have made Letter of Credit  Advances
         pursuant to Section  2.03(c) that are  outstanding  at such time,  each
         such other Revolving Credit Lender and (c) the Swing Line Facility, (i)
         the Swing Line Bank and (ii) if the other Revolving Credit Lenders have
         made  Swing  Line  Advances   pursuant  to  Section  2.02(b)  that  are
         outstanding at such time, each such other Revolving Credit Lender.

                  "Arranger" means Citicorp Securities, Inc.

                  "Assignment and Acceptance" means an assignment and acceptance
         entered into by a Lender Party and an Eligible  Assignee,  and accepted
         by the  Administrative  Agent,  in accordance  with Section 9.07 and in
         substantially the form of Exhibit C hereto.

                  "Available Amount" of any Letter of Credit means, at any time,
         the maximum amount available to be drawn under such Letter of Credit at
         such time  (assuming  compliance  at such time with all  conditions  to
         drawing).

                  "BA Lending Office" means, with respect to each  Multicurrency
         Lender,  the office of such Lender set forth as its "BA Lending Office"
         opposite  its  name on  Schedule  I  hereto  or in the  Assignment  and
         Acceptance pursuant to which it became a Lender or such other office of
         such Lender in Canada as such  Lender may from time to time  specify to
         the Canadian Borrower and the Administrative Agent for such purpose.

                  "BA Rate" means, for all Bankers' Acceptances  comprising part
         of the same Drawing, the average rate (calculated on an annual basis of
         a year of 365 days and rounded up to the nearest multiple of 1/4 of 1%,
         if such average is not such a multiple)  for Canadian  Dollar  Bankers'
         Acceptances having a comparable term that appears on the Reuters Screen
         CDOR  Page  (or  such  other  page as is a  replacement  page  for such
         bankers'  acceptances) at 10:00 A.M. (Toronto time) or, if such rate is
         not available at such time, the applicable  discount rate in respect of
         such Bankers'  Acceptances shall be the discount rate (calculated on an
         annual  basis of a year of 365  days)  and  rounded  up to the  nearest
         multiple of 1/4 of 1%, quoted by the Canadian  Reference Lender at 9:30
         a.m. (Toronto time) on the date of such Drawing as the discount rate at
         which the Canadian  Reference Lender would purchase,  on such date, its
         own bankers'  acceptances  having an aggregate Face Amount equal to and
         with a term to  maturity  the same as the  Bankers'  Acceptances  to be
         acquired by the Canadian Reference Lender as part of such Drawing.  The
         BA Rate  for  each  Bankers'  Acceptance  comprising  part of the  same
         Drawing shall be determined by the Administrative Agent on the basis of
         applicable rates furnished to and received by the Administrative  Agent
         from  the  Canadian  Reference  Lender  on the  date of the  applicable
         Drawing, subject, however, to the provisions of Section 2.08.



<PAGE>   13


                                        7

                  "Banker's  Acceptance"  has the meaning  specified  in Section
         2.01(h).

                  "Base Rate"  means a  fluctuating  interest  rate per annum in
         effect  from time to time,  which rate per annum  shall at all times be
         equal to the highest of:

                           (a)  the  rate  of  interest  announced  publicly  by
                  Citibank  in New  York,  New  York,  from  time  to  time,  as
                  Citibank's base rate;

                           (b) the sum (adjusted to the nearest 1/4 of 1% or, if
                  there is no nearest  1/4 of 1%, to the next  higher 1/4 of 1%)
                  of (i) 1/2 of 1% per  annum,  plus (ii) the rate  obtained  by
                  dividing (A) the latest three-week moving average of secondary
                  market  morning  offering  rates  in  the  United  States  for
                  three-month  certificates  of deposit of major  United  States
                  money market banks,  such three-week  moving average (adjusted
                  to the basis of a year of 360 days) being determined weekly on
                  each  Monday  (or,  if such day is not a Business  Day, on the
                  next succeeding Business Day) for the three-week period ending
                  on the previous  Friday by Citibank on the basis of such rates
                  reported by certificate of deposit dealers to and published by
                  the Federal  Reserve Bank of New York or, if such  publication
                  shall be suspended or  terminated,  on the basis of quotations
                  for such  rates  received  by  Citibank  from  three  New York
                  certificate of deposit dealers of recognized standing selected
                  by  Citibank,  by (B) a  percentage  equal to 100%  minus  the
                  average  of  the  daily  percentages   specified  during  such
                  three-week  period by the Board of  Governors  of the  Federal
                  Reserve System (or any successor) for  determining the maximum
                  reserve  requirement  (including,  but  not  limited  to,  any
                  emergency, supplemental or other marginal reserve requirement)
                  for Citibank  with  respect to  liabilities  consisting  of or
                  including  (among other  liabilities)  three-month U.S. dollar
                  non-personal  time deposits in the United  States,  plus (iii)
                  the  average  during  such  three-week  period  of the  annual
                  assessment  rates  estimated by Citibank for  determining  the
                  then  current  annual  assessment  payable by  Citibank to the
                  Federal Deposit  Insurance  Corporation (or any successor) for
                  insuring  U.S.  dollar  deposits  of  Citibank  in the  United
                  States; and

                           (c) 1/2 of 1% per annum above the Federal Funds Rate.

                  "Base Rate  Advance"  means an Advance that bears  interest as
         provided in Section 2.08(a)(i).

                  "Borrower" means any of the Company or any Foreign Borrower.

                  "Borrower's  Account"  means (a) with  respect to the Company,
         the account of the Company  maintained  by the Company with The Bank of
         New York at its office at 101

<PAGE>   14


                                        8

         Barclay Street, New York, New York, Account No. 823-0037-036,  (b) with
         respect  to  the  Canadian  Borrower,  the  account  of  such  Borrower
         maintained  by such Borrower with The Bank of Nova Scotia at its office
         in Toronto, Ontario, Canada, Account No. 85761- 14, (c) with respect to
         HHEL,  the account of such  Borrower  maintained  by such Borrower with
         Barclays Bank PLC at its office at Business  Center,  51 Mosley Street,
         Manchester,  England,  Account No. 20553410231827,  (d) with respect to
         Rigby,  the account of such  Borrower  maintained by such Borrower with
         Den Danske Bank at its office at 6000 Koding,  Account No.  3211205148,
         and  (e)  with  respect  to  Danmark,  the  account  of  such  Borrower
         maintained  by such  Borrower  with  _______________  at its  office at
         ____________________, New York, New York _____, Account No. __________,
         or, in any case,  such other account as such Borrower  shall specify in
         writing to the Administrative Agent.

                  "Borrowing"  means a Term A Borrowing,  a Term B Borrowing,  a
         Delayed Draw Borrowing,  a Multicurrency  Borrowing, a Revolving Credit
         Borrowing or a Swing Line Borrowing.

                  "Borrowing   Base   Certificate"   means  a   certificate   in
         substantially  the  form of  Exhibit  M  hereto,  duly  certified  by a
         Designated Officer of the Company.

                  "Business  Day" means a day of the year on which banks are not
         required  or  authorized  by law to close in New York City and,  if the
         applicable  Business Day relates to any Eurocurrency Rate Advances,  on
         which dealings are carried on in the London  interbank market and banks
         are open for  business  in London  and in the  country  of issue of the
         currency  of such  Eurocurrency  Rate  Advance  (or,  in the case of an
         Advance  denominated  in  the  euro,  in  Frankfurt,  Germany),  if the
         applicable  Business Day relates to any Local Rate  Advances,  on which
         banks are open for  business in the country of issue of the currency of
         such Local Rate Advance and, if the applicable  Business Day relates to
         Bankers' Acceptances,  on which banks are open for business in Toronto,
         Ontario, Canada.

                  "Canadian Cash Collateral  Account" has the meaning  specified
         in the Canadian Security Agreement.

                  "Canadian  Dollars"  and the "CN$"  sign each means the lawful
         currency of Canada.

                  "Canadian  Domestic Lending Office" means, with respect to any
         Multicurrency  Lender,  the  office  of such  Lender  specified  as its
         "Canadian  Domestic  Lending  Office"  opposite  its name on Schedule I
         hereto or in the Assignment and Acceptance  pursuant to which it became
         a Lender, as the case may be, or such other office of such Lender in


<PAGE>   15


                                        9

         Canada as such  Lender may from time to time  specify  to the  Canadian
         Borrower and the Administrative Agent.

                  "Canadian  Prime Rate" means a  fluctuating  interest rate per
         annum in effect  from time to time,  which rate per annum  shall at all
         times be equal to the higher of:

                           (a) the rate  (rounded  upward to the  nearest  whole
                  multiple of 1/4 of 1% per annum),  which the principal  office
                  of the Canadian Reference Lender in Toronto, Ontario announces
                  publicly  from time to time as its prime rate for  determining
                  rates of interest on commercial loans in Canadian Dollars made
                  by it in Canada; and

                           (b) 3/4 of 1% per  annum  above the rate  quoted  for
                  30-day Canadian Dollar bankers' acceptances of Citibank Canada
                  that  appears  on  the  Reuters   Screen  CDOR  Page  (or  any
                  replacement page) as of 10:00 a.m. (Toronto,  Ontario time) on
                  the date of determination.

                  "Canadian  Prime Rate Advance" means a  Multicurrency  Advance
         made in  Canadian  Dollars  that bears  interest as provided in Section
         2.08(a)(iii).

                  "Canadian  Reference  Lender" means Citibank Canada;  provided
         that, if the foregoing  shall cease to be a Multicurrency  Lender,  the
         term  "Canadian   Reference   Lender"  shall  no  longer  include  such
         Multicurrency  Lender and shall thereafter include such Canadian Lender
         as the  Agent  shall  designate  as a  replacement  Canadian  Reference
         Lender,  which  designation  shall  be made  with the  consent  of such
         replacement Canadian Reference Lender and the Canadian Borrower,  which
         consent  shall not be  unreasonably  withheld or delayed  and  provided
         further  that if any  Multicurrency  Lenders  are  banks  set  forth in
         Schedule I of the Bank Act (Canada), the Canadian Reference Lender will
         be such a Schedule I bank.

                  "Canadian  Security  Agreement"  has the meaning  specified in
         Section 3.01(a)(v).

                  "Capital  Expenditures"  means, for any Person for any period,
         the sum of, without duplication, (a) all expenditures made, directly or
         indirectly,  by such  Person  or any of its  Subsidiaries  during  such
         period for equipment,  fixed assets, real property or improvements,  or
         for replacements or substitutions  therefor or additions thereto,  that
         have been or should be, in accordance with GAAP, reflected as additions
         to property, plant or equipment on a Consolidated balance sheet of such
         Person  or have a  useful  life of more  than  one  year  plus  (b) the
         aggregate  principal  amount of all Debt (including  Obligations  under
         Capitalized  Leases)  assumed or incurred in  connection  with any such
         expenditures,   but   not   including   interest   capitalized   during
         construction or any Investments permitted



<PAGE>   16


                                       10

         pursuant to Section  5.02(f) related to  acquisitions.  For purposes of
         this  definition,  the purchase  price of  equipment  that is purchased
         simultaneously   with  the  trade-in  of  existing  equipment  or  with
         insurance  proceeds shall be included in Capital  Expenditures  only to
         the extent of the gross amount of such  purchase  price less the credit
         granted by the seller of such equipment for the equipment  being traded
         in at such time or the amount of such insurance  proceeds,  as the case
         may be.

                  "Capitalized Leases" means all leases that have been or should
         be, in accordance with GAAP, recorded as capitalized leases.

                  "Cash  Collateral  Account"  has the meaning  specified in the
         Security Agreement.

                  "Cash Equivalents"  means any of the following,  to the extent
         owned by the Company or any of its  Subsidiaries  free and clear of all
         Liens  other than Liens  created  under the  Collateral  Documents  and
         having  a  maturity  of not  greater  than  one  year  from the date of
         issuance  thereof:  (a) direct  obligations  of the  Government  of the
         United  States or the United  Kingdom or any agency or  instrumentality
         thereof or  obligations  unconditionally  guaranteed  or insured by the
         full faith and  credit of the  Government  of the United  States or the
         United Kingdom,  (b)  certificates of deposit of, time deposits with or
         bankers'  acceptances of, any commercial bank that is a Lender Party or
         a member of the Federal Reserve System,  issues (or the parent of which
         issues)  commercial  paper rated as described  in clause (c) below,  is
         organized or licensed  under the laws of the United States or any State
         thereof  and has  combined  capital and surplus of at least $1 billion,
         (c) commercial  paper in an aggregate amount of no more than $5,000,000
         per issuer outstanding at any time, issued by any corporation organized
         under  the laws of any  State of the  United  States or the laws of the
         United  Kingdom and rated at least  "Prime-1"  (or the then  equivalent
         grade)  by  Moody's  Investors  Service,  Inc.  or  "A-1"  (or the then
         equivalent  grade) by Standard & Poor's Ratings Service,  a division of
         The McGraw-Hill Companies, Inc., (d) repurchase obligations with a term
         of not more than  thirty  days for  underlying  securities  of the type
         described in clauses (a) and (b) above  entered into with any financial
         institution  meeting the qualifications  specified in clause (b) above,
         in an  aggregate  amount  of no more  than  $5,000,000  at any one time
         outstanding and (e) money market mutual funds  substantially all of the
         assets of which are invested primarily in assets of the types described
         in clauses (a) through (d) above.

                  "CERCLA"  means  the  Comprehensive   Environmental  Response,
         Compensation and Liability Act of 1980, as amended from time to time.

                  "CERCLIS"  means  the  Comprehensive  Environmental  Response,
         Compensation and Liability  Information  System  maintained by the U.S.
         Environmental Protection Agency.


<PAGE>   17


                                       11

                  "Change  of  Control"  means  the  occurrence  of  any  of the
         following: (a) WHX Corporation and any of its wholly-owned Subsidiaries
         shall have ceased to own  beneficial  ownership  of Voting Stock of the
         Company  representing  60% of the  combined  voting power of all Voting
         Stock of the Company;  or (b) during any period of up to 24 consecutive
         months, commencing after the date of this Agreement, individuals who at
         the  beginning of such  24-month  period were  directors of the Company
         shall cease,  without the consent of WHX  Corporation,  to constitute a
         majority of the board of directors of the Company; or (c) any Person or
         two or more Persons acting in concert other than WHX Corporation  shall
         have  acquired by contract or  otherwise,  or shall have entered into a
         contract or arrangement that, upon consummation,  will result in its or
         their acquisition of control over Voting Stock of the Company (or other
         securities convertible into such Voting Stock) representing 40% or more
         of the combined voting power of all Voting Stock of the Company.

                  "Citibank" means Citibank, N.A.

                  "Collateral"  means  all  "Collateral"   referred  to  in  the
         Collateral  Documents and all other  property that is or is intended to
         be subject to any Lien in favor of the Collateral Agent for the benefit
         of the Secured Parties.

                  "Collateral Agent" has the meaning specified in the recital of
         parties to this Agreement.

                  "Collateral  Documents"  means  the  Security  Agreement,  the
         Canadian Security  Agreement,  the Mortgages,  the Deed of Charge,  the
         Deed of Charge  over  Shares and any other  agreement  that  creates or
         purports  to  create a Lien in favor of the  Collateral  Agent  for the
         benefit of the Secured Parties.

                  "Commitment" means a Term A Commitment, a Term B Commitment, a
         Delayed Draw Commitment, a Multicurrency Commitment, a Revolving Credit
         Commitment or a Letter of Credit Commitment.

                  "Consolidated"  refers to the  consolidation  of  accounts  in
         accordance with GAAP.

                  "Contingent Obligation" means, with respect to any Person, any
         Obligation  or  arrangement  of such Person to guarantee or intended to
         guarantee  any Debt,  leases,  dividends or other  payment  Obligations
         ("primary  obligations") of any other Person (the "primary obligor") in
         any  manner,  whether  directly  or  indirectly,   including,   without
         limitation,  (a) the direct or indirect  guarantee,  endorsement (other
         than for  collection  or deposit in the ordinary  course of  business),
         co-making,  discounting  with  recourse  or sale with  recourse by such
         Person of the Obligation of a primary obligor, (b) the Obligation to



<PAGE>   18


                                       12

         make  take-or-pay  or similar  payments,  if  required,  regardless  of
         nonperformance by any other party or parties to an agreement or (c) any
         Obligation of such Person,  whether or not contingent,  (i) to purchase
         any such  primary  obligation  or any property  constituting  direct or
         indirect security therefor, (ii) to advance or supply funds (A) for the
         purchase or payment of any such primary  obligation  or (B) to maintain
         working  capital or equity capital of the primary  obligor or otherwise
         to maintain the net worth or solvency of the primary obligor,  (iii) to
         purchase  property,  assets,  securities or services  primarily for the
         purpose of assuring  the owner of any such  primary  obligation  of the
         ability  of the  primary  obligor  to  make  payment  of  such  primary
         obligation  or (iv)  otherwise to assure or hold harmless the holder of
         such primary obligation against loss in respect thereof.  The amount of
         any Contingent  Obligation shall be deemed to be an amount equal to the
         stated or determinable  amount of the primary  obligation in respect of
         which such  Contingent  Obligation  is made (or,  if less,  the maximum
         amount of such primary  obligation  for which such Person may be liable
         pursuant  to the terms of the  instrument  evidencing  such  Contingent
         Obligation) or, if not stated or determinable,  the maximum  reasonably
         anticipated  liability  in respect  thereof  (assuming  such  Person is
         required to perform  thereunder),  as determined by such Person in good
         faith.

                  "Conversion",  "Convert"  and  "Converted"  each  refer  to  a
         conversion  of  Advances  of one Type into  Advances  of the other Type
         pursuant to Section 2.08(d), 2.10 or 2.12.

                  "Conversion Date" means July 30, 2000.

                  "Danmark  Effective Date" has the meaning specified in Section
         3.02.

                  "Debt"  of any  Person  means,  without  duplication  (a)  all
         indebtedness of such Person for borrowed money,  (b) all Obligations of
         such  Person for the  deferred  purchase  price of property or services
         (other than trade payables not overdue by more than 60 days incurred in
         the ordinary course of such Person's business),  (c) all Obligations of
         such Person  evidenced by notes,  bonds,  debentures  or other  similar
         instruments,  (d) all  Obligations  of such  Person  created or arising
         under any  conditional  sale or other title  retention  agreement  with
         respect to property acquired by such Person (even though the rights and
         remedies of the seller or lender  under such  agreement in the event of
         default are limited to repossession or sale of such property),  (e) all
         Obligations of such Person as lessee under Capitalized  Leases, (f) all
         Obligations  of such  Person  under  acceptance,  letter  of  credit or
         similar  facilities,  (g) all  Obligations  of such Person to purchase,
         redeem, retire, defease or otherwise make any payment in respect of any
         capital stock of or other  ownership or profit  interest in such Person
         or any other Person or any warrants,  rights or options to acquire such
         capital stock,  valued,  in the case of Redeemable  Preferred Stock, at
         the greater of its voluntary or involuntary liquidation preference plus
         accrued and unpaid  dividends,  (h) all  Obligations  of such Person in
         respect of Hedge Agreements,



<PAGE>   19


                                       13

         valued at the Agreement Value thereof,  (i) all Obligations  contingent
         or  otherwise,  of such Person for  production  payments  from property
         operated by or on behalf of such person and other similar  arrangements
         with respect to natural  resources,  (j) all Contingent  Obligations of
         such  Person and (k) all  indebtedness  and other  payment  Obligations
         referred to in clauses (a) through (j) above of another  Person secured
         by (or for  which  the  holder  of such  Debt  has an  existing  right,
         contingent  or  otherwise,  to be  secured  by) any  Lien  on  property
         (including, without limitation,  accounts and contract rights) owned by
         such Person,  even though such Person has not assumed or become  liable
         for the  payment of such  indebtedness  or other  payment  Obligations;
         provided that "Debt" shall not include  Obligations  under the Precious
         Metals Leasing.

                  "Debt for Borrowed  Money" of any Person means all items that,
         in  accordance  with GAAP,  would be classified  as  indebtedness  on a
         Consolidated balance sheet of such Person.

                  "Deed of Charge  over  Shares" has the  meaning  specified  in
         Section 3.01(a)(vi).

                  "Default"  means any Event of  Default or any event that would
         constitute an Event of Default but for the  requirement  that notice be
         given or time elapse or both.

                  "Defaulted Advance" means, with respect to any Lender Party at
         any time, the portion of any Advance required to be made by such Lender
         Party to any  Borrower  pursuant to Section 2.01 or 2.02 at or prior to
         such  time  that  has not  been  made by such  Lender  Party  or by the
         Administrative  Agent for the account of such Lender Party  pursuant to
         Section  2.02(e)  as of such  time.  In the event  that a portion  of a
         Defaulted Advance shall be deemed made pursuant to Section 2.17(a), the
         remaining  portion of such  Defaulted  Advance  shall be  considered  a
         Defaulted  Advance  originally  required to be made pursuant to Section
         2.01 on the same date as the Defaulted Advance so deemed made in part.

                  "Defaulted  Amount" means, with respect to any Lender Party at
         any time,  any amount  required to be paid by such Lender  Party to any
         Agent or any other  Lender  Party  hereunder  or under  any other  Loan
         Document  at or prior to such time that has not been so paid as of such
         time, including,  without limitation, any amount required to be paid by
         such  Lender  Party to (a) the Swing  Line  Bank  pursuant  to  Section
         2.02(b) to purchase a portion of a Swing Line Advance made by the Swing
         Line Bank, (b) any Issuing Bank pursuant to Section 2.03(c) to purchase
         a portion of a Letter of Credit  Advance made by such Issuing Bank, (c)
         the  Administrative  Agent pursuant to Section 2.02(e) to reimburse the
         Administrative  Agent  for  the  amount  of  any  Advance  made  by the
         Administrative  Agent for the  account of such  Lender  Party,  (d) any
         other   Lender   Party   pursuant  to  Section  2.15  to  purchase  any
         participation in Advances owing to such other Lender Party



<PAGE>   20


                                       14

         and (e) any Agent or any  Issuing  Bank  pursuant  to  Section  8.05 to
         reimburse  such  Agent or such  Issuing  Bank for such  Lender  Party's
         ratable share of any amount  required to be paid by the Lender  Parties
         to such Agent or such  Issuing Bank as provided  therein.  In the event
         that a portion of a Defaulted  Amount shall be deemed paid  pursuant to
         Section 2.17(b),  the remaining  portion of such Defaulted Amount shall
         be  considered  a  Defaulted  Amount  originally  required  to be  paid
         hereunder  or under any  other  Loan  Document  on the same date as the
         Defaulted Amount so deemed paid in part.

                  "Defaulting Lender" means, at any time, any Lender Party that,
         at such time, (a) owes a Defaulted Advance or a Defaulted Amount or (b)
         shall take any action or be the subject of any action or  proceeding of
         a type described in Section 6.01(f).

                  "Default  Termination  Notice"  has the meaning  specified  in
         Section 2.01(g).

                  "Delayed  Draw  Advance" has the meaning  specified in Section
         2.01(c).

                  "Delayed  Draw  Borrowing"  means a  borrowing  consisting  of
         simultaneous Delayed Draw Advances of the same Type made by the Delayed
         Draw Lenders.

                  "Delayed Draw Commitment"  means,  with respect to any Delayed
         Draw  Lender at any time,  the Dollar  amount set forth  opposite  such
         Lender's  name on  Schedule I hereto  under the caption  "Delayed  Draw
         Commitment"  or, if such Lender has entered into one or more Assignment
         and Acceptances,  set forth for such Lender in the Register  maintained
         by the  Administrative  Agent  pursuant  to  Section  9.07(d)  as  such
         Lender's "Delayed Draw Commitment", as such amount may be reduced at or
         prior to such time pursuant to Section 2.06.

                  "Delayed  Draw  Facility"  means,  at any time,  the aggregate
         amount of the Delayed Draw Lenders'  Delayed Draw  Commitments  at such
         time.

                  "Delayed Draw Lender" means any Lender that has a Delayed Draw
         Commitment.

                  "Delayed  Draw Note"  means a  promissory  note of the Company
         payable to the order of any Delayed Draw Lender,  in substantially  the
         form of Exhibit A-3 hereto,  evidencing the indebtedness of the Company
         to such Lender  resulting  from the Delayed  Draw  Advance made by such
         Lender, as amended.

                  "Delayed Draw Reduction  Amount" has the meaning  specified in
         Section 2.07(b)(ix).



<PAGE>   21


                                       15

                  "Designated   Officer"  means  the  Chief  Financial  Officer,
         Controller,  Treasurer or any other  officer  designated by the Company
         from time to time to the Administrative  Agent as authorized to deliver
         the Borrowing Base Certificate or to otherwise  provide  certifications
         required hereunder.

                  "Dollars"  and the "$" sign each means lawful  currency of the
         United States of America.

                  "Domestic  Lending  Office" means,  with respect to any Lender
         Party,  the office of such  Lender  Party  specified  as its  "Domestic
         Lending  Office"  opposite  its name on  Schedule  I  hereto  or in the
         Assignment and  Acceptance  pursuant to which it became a Lender Party,
         as the case may be, or such other  office of such Lender  Party as such
         Lender  Party  may from time to time  specify  to the  Company  and the
         Administrative Agent.

                  "Domestic  Subsidiary"  means  any  Subsidiary  other  than  a
         Foreign Subsidiary.

                  "Domestic   Subsidiary   Guarantors"  means  all  wholly-owned
         Domestic   Subsidiaries   of  the  Company  (other  than  any  Inactive
         Subsidiary)  and each other  Domestic  Subsidiary  of the Company  that
         shall be required to execute and deliver a guaranty pursuant to Section
         5.01(j).

                  "Domestic  Subsidiary  Guaranty" has the meaning  specified in
         Section 3.01(a)(iii).

                  "Draft" means a blank bill of exchange,  within the meaning of
         the Bills of Exchange Act (Canada),  drawn by the Canadian  Borrower on
         any Multicurrency Lender, in substantially the form of Exhibit A-6, and
         which,  except as otherwise  provided herein, has not been completed or
         accepted by such Lender.

                  "Drawing"  means the  simultaneous  acceptance  of Drafts  and
         purchase of  Bankers'  Acceptances  by the  Multicurrency  Lenders,  in
         accordance with Section 2.04(a).

                  "Drawing Fee" means, with respect to each Bankers' Acceptance,
         an amount equal to (a) the Applicable  Percentage in effect on the date
         of the  Drawing  or  renewal,  as the  case  may be,  of such  Bankers'
         Acceptance   multiplied  by  (b)  the  Face  Amount  of  such  Bankers'
         Acceptance,  calculated  on the basis of the term to  maturity  of such
         Bankers' Acceptance and a year of 365 days.

                  "Drawing  Purchase Price" means, with respect to each Bankers'
         Acceptance to be purchased and/or accepted by any Multicurrency  Lender
         at any time,  the amount  (adjusted  to the  nearest  whole cent or, if
         there is no nearest whole cent, the next higher whole cent)



<PAGE>   22


                                       16

         obtained by dividing  (a) the  aggregate  Face Amount of such  Bankers'
         Acceptance,  by (b) the sum of (i) one and (ii) the  product of (A) the
         BA Rate in  effect  at such  time  (expressed  as a  decimal  fraction)
         multiplied  by (B) a fraction  the  numerator of which is the number of
         days  in the  term to  maturity  of such  Bankers'  Acceptance  and the
         denominator of which is 365 days.

                  "EBITDA" means, for any period,  the sum, without  duplication
         and  determined  on a  Consolidated  basis,  of (a) net  income (or net
         loss), (b) interest expense,  (c) income tax expense,  (d) depreciation
         expense, (e) amortization expense, (f) lease expense under the Precious
         Metals Leasing, (g) extraordinary,  unusual or nonrecurring  (including
         change of control  charges)  losses deducted in calculating net income,
         (h) any  increase  in the  long  term  liability  in  respect  of other
         post-retirement  benefit or pension  benefit to the extent  included in
         the calculation of net income ("Employee Liability"),  (i) any decrease
         in  pension  asset to the extent  included  in the  calculation  of net
         income  ("Pension  Asset") and (j) other  non-cash  charges  (including
         without limitation, the lower of cost or market adjustment with respect
         to Precious Metal Inventory) less (i) interest income,  (ii) income tax
         credit, (iii) extraordinary,  unusual or nonrecurring gains included in
         calculating net income and (iv) any decrease in the Employee Liability;
         and (v) any increase in the Pension Asset,  in each case of the Company
         and its  Subsidiaries,  determined  in  accordance  with  GAAP for such
         period.

                  "Eligible  Assignee"  means (a) with  respect to any  Facility
         (other  than the  Letter of  Credit  Facility),  (i) a Lender;  (ii) an
         Affiliate of a Lender; (iii) a commercial bank organized under the laws
         of the United States, or any State thereof,  and having total assets in
         excess  of  $3,000,000,000;  (iv) a  savings  and loan  association  or
         savings  bank  organized  under the laws of the United  States,  or any
         State thereof, and having total assets in excess of $3,000,000,000; (v)
         a commercial bank organized under the laws of any other country that is
         a member of the OECD or has concluded special lending arrangements with
         the   International   Monetary   Fund   associated   with  its  General
         Arrangements to Borrow, or a political subdivision of any such country,
         and having  total assets in excess of  $5,000,000,000,  so long as such
         bank is acting  through a branch or agency  located  in the  country in
         which it is  organized  or another  country  that is  described in this
         clause (v);  (vi) the central  bank of any country  that is a member of
         the OECD;  (vii) with respect to any Lender that is a fund that invests
         in bank loans,  any other fund or trust or entity that  invests in bank
         loans and is advised or managed by the same investment  advisor as such
         Lender or by an Affiliate of such  investment  advisor;  and (viii) any
         other  Person  regularly  engaged in the  business of investing in bank
         loans and approved by the  Administrative  Agent and,  unless a Default
         has occurred and is continuing  at the time any  assignment is effected
         pursuant  to  Section  9.07,  the  Company,  such  approval  not  to be
         unreasonably withheld or delayed, and (b) with respect to the Letter of
         Credit Facility,  a Person that is an Eligible Assignee under subclause
         (iii) or (v) of clause (a) of this definition and is



<PAGE>   23


                                       17

         approved by the Administrative Agent and, unless a Default has occurred
         and is  continuing at the time any  assignment is effected  pursuant to
         Section  9.07,  the  Company,  such  approval  not  to be  unreasonably
         withheld or delayed; provided, however, that neither any Loan Party nor
         any  Affiliate  of a Loan Party shall  qualify as an Eligible  Assignee
         under this definition.

                  "Eligible Collateral" means, collectively,  Eligible Inventory
         and Eligible Receivables.

                  "Eligible  Inventory"  means only such  Inventory  of the Loan
         Parties  as the  Administrative  Agent,  in its  reasonable  discretion
         consistent  with  its  customary   business   practices  and  generally
         applicable criteria for comparable secured financings,  shall from time
         to time elect to  consider  Eligible  Inventory  for  purposes  of this
         Agreement.  The  value of such  Inventory  shall be  determined  by the
         Administrative Agent in its reasonable  discretion  consistent with its
         customary  business  practices  and generally  applicable  criteria for
         comparable secured financings,  taking into consideration,  among other
         factors,  the  lower of its cost and its  market  value  determined  in
         accordance  with GAAP and,  in the case of  Precious  Metal  Inventory,
         market value.

                  "Eligible Receivables" means only such Receivables of the Loan
         Parties  as the  Administrative  Agent,  in its  reasonable  discretion
         consistent  with  its  customary   business   practices  and  generally
         applicable criteria for comparable secured financings,  shall from time
         to time elect to consider  Eligible  Receivables  for  purposes of this
         Agreement.  The value of such  Receivables  shall be  determined by the
         Administrative Agent in its reasonable  discretion  consistent with its
         customary  business  practices  and generally  applicable  criteria for
         comparable secured financings,  taking into consideration,  among other
         factors, their book value determined in accordance with GAAP.

                  "Environmental  Action" means any action, suit, demand, demand
         letter,  claim,  notice  of  non-compliance  or  violation,  notice  of
         liability or potential liability,  investigation,  proceeding,  consent
         order or consent  agreement  relating  in any way to any  Environmental
         Law, any  Environmental  Permit or  Hazardous  Material or arising from
         alleged  injury  or  threat  to  health,  safety  or  the  environment,
         including,  without  limitation,  (a) by any governmental or regulatory
         authority for  enforcement,  cleanup,  removal,  response,  remedial or
         other  actions or damages  and (b) by any  governmental  or  regulatory
         authority  or third party for damages,  contribution,  indemnification,
         cost recovery, compensation or injunctive relief.

                  "Environmental Law" means any Federal, state, local or foreign
         statute, law, ordinance, rule, regulation, code, order, writ, judgment,
         injunction,  decree or  judicial  or agency  interpretation,  policy or
         guidance relating to pollution or protection of the



<PAGE>   24


                                       18

         environment,  health, safety or natural resources,  including,  without
         limitation,  those  relating  to  the  use,  handling,  transportation,
         treatment,   storage,  disposal,  release  or  discharge  of  Hazardous
         Materials.

                  "Environmental    Permit"   means   any   permit,    approval,
         identification  number,  license or other authorization  required under
         any Environmental Law.

                  "Equivalent"  in Dollars of any  Foreign  Currency on any date
         means the equivalent in Dollars of such Foreign Currency  determined by
         using the quoted spot rate at which the Sub-Agent's principal office in
         London offers to exchange  Dollars for such Foreign  Currency in London
         prior to 4:00 P.M.  (London  time) (unless  otherwise  indicated by the
         terms of this  Agreement)  on such date as is required  pursuant to the
         terms of this Agreement,  and the  "Equivalent" in any Foreign Currency
         of Dollars  means the  equivalent  in such Foreign  Currency of Dollars
         determined  by using the  quoted  spot  rate at which  the  Sub-Agent's
         principal office in London offers to exchange such Foreign Currency for
         Dollars in London prior to 4:00 P.M.  (London time)  (unless  otherwise
         indicated by the terms of this  Agreement)  on such date as is required
         pursuant to the terms of this Agreement.

                  "ERISA" means the Employee  Retirement  Income Security Act of
         1974, as amended from time to time, and the regulations promulgated and
         rulings issued thereunder.

                  "ERISA  Affiliate" means any Person that for purposes of Title
         IV of ERISA is a member of the controlled  group of any Loan Party,  or
         under common control with any Loan Party, within the meaning of Section
         414 of the Internal Revenue Code.

                  "ERISA  Event"  means  (a)(i) the  occurrence  of a reportable
         event,  within the meaning of Section 4043(c) of ERISA, with respect to
         any Plan  unless the 30-day  notice  requirement  with  respect to such
         event has been waived or extended by the PBGC or (ii) the  requirements
         of Section  4043(b)  of ERISA  apply  with  respect  to a  contributing
         sponsor,  as defined in Section 4001(a)(13) of ERISA, of a Plan, and an
         event  described in paragraph (9), (10),  (11), (12) or (13) of Section
         4043(c) of ERISA is  reasonably  expected to occur with respect to such
         Plan within the following 30 days;  (b) the  application  for a minimum
         funding  waiver  with  respect  to a  Plan;  (c) the  provision  by the
         administrator of any Plan of a notice of intent to terminate such Plan,
         pursuant to Section 4041(a)(2) of ERISA (including any such notice with
         respect to a plan amendment  referred to in Section  4041(e) of ERISA);
         (d) the  cessation of operations at a facility of any Loan Party or any
         ERISA  Affiliate in the  circumstances  described in Section 4062(e) of
         ERISA; (e) the withdrawal by any Loan Party or any ERISA Affiliate from
         a  Multiple  Employer  Plan  during  a plan  year  for  which  it was a
         substantial employer, as defined in



<PAGE>   25


                                       19

         Section  4001(a)(2) of ERISA;  (f) the  conditions  for imposition of a
         lien under Section  302(f) of ERISA shall have been met with respect to
         any Plan;  (g) the  adoption of an amendment  to a Plan  requiring  the
         provision of security to such Plan pursuant to Section 307 of ERISA; or
         (h) the  institution  by the PBGC of  proceedings  to  terminate a Plan
         pursuant to Section 4042 of ERISA,  or the  occurrence  of any event or
         condition  described in Section 4042 of ERISA that constitutes  grounds
         for the  termination of, or the appointment of a trustee to administer,
         such Plan.

                  "Eurocurrency  Lending  Office"  means,  with  respect  to any
         Lender  Party,  the  office  of  such  Lender  Party  specified  as its
         "Eurocurrency Lending Office" opposite its name on Schedule I hereto or
         in the Assignment  and Acceptance  pursuant to which it became a Lender
         Party  (or,  if no such  office  is  specified,  its  Domestic  Lending
         Office), or such other office of such Lender Party as such Lender Party
         may from time to time specify to the Borrowers  and the  Administrative
         Agent.

                  "Eurocurrency   Liabilities"  has  the  meaning  specified  in
         Regulation D of the Board of Governors of the Federal  Reserve  System,
         as in effect from time to time.

                  "Eurocurrency  Rate" means,  for any  Interest  Period for all
         Eurocurrency  Rate Advances  comprising part of the same Borrowing,  an
         interest  rate  per  annum  equal to the rate  per  annum  obtained  by
         dividing (a) the average  (rounded upward to the nearest whole multiple
         of 1/16 of 1% per annum, if such average is not such a multiple) of the
         rate per annum at which  deposits  in Dollars or the  relevant  Foreign
         Currencies are offered by the principal office of each of the Reference
         Banks in London,  England to prime banks in the London interbank market
         at 11:00 A.M.  (London  time) two Business Days before the first day of
         such Interest Period in an amount substantially equal to such Reference
         Bank's  Eurocurrency Rate Advance  comprising part of such Borrowing to
         be outstanding  during such Interest Period (or, if such Reference Bank
         shall not have such a Eurocurrency Rate Advance,  $1,000,000) and for a
         period equal to such Interest Period by (b) a percentage  equal to 100%
         minus  the  Eurocurrency  Rate  Reserve  Percentage  for such  Interest
         Period.  The  Eurocurrency  Rate  for  any  Interest  Period  for  each
         Eurocurrency  Rate Advance  comprising part of the same Borrowing shall
         be  determined by the  Administrative  Agent on the basis of applicable
         rates  furnished to and received by the  Administrative  Agent from the
         Reference Banks two Business Days before the first day of such Interest
         Period, subject, however, to the provisions of Section 2.08.

                  "Eurocurrency  Rate  Advance"  means  an  Advance  that  bears
         interest as provided in Section 2.08(a)(ii).

                  "Eurocurrency Rate Reserve Percentage" for any Interest Period
         for  all  Eurocurrency  Rate  Advances  comprising  part  of  the  same
         Borrowing means the reserve



<PAGE>   26


                                       20

         percentage  applicable  two Business  Days before the first day of such
         Interest Period under regulations issued from time to time by the Board
         of  Governors  of the Federal  Reserve  System (or any  successor)  for
         determining  the  maximum  reserve  requirement   (including,   without
         limitation,  any  emergency,  supplemental  or other  marginal  reserve
         requirement)  for a member  bank of the Federal  Reserve  System in New
         York City with  respect  to  liabilities  or  assets  consisting  of or
         including  Eurocurrency  Liabilities  (or  with  respect  to any  other
         category of  liabilities  that includes  deposits by reference to which
         the interest rate on Eurocurrency Rate Advances is determined) having a
         term equal to such Interest Period.

                  "Events of Default" has the meaning specified in Section 6.01.

                  "Excess Cash Flow" means, for any period,  Consolidated EBITDA
         minus  (a) cash  Capital  Expenditures,  (b)  non-deferred  income  tax
         expense,  (c) cash interest payable on all Debt for Borrowed Money (net
         of cash interest  income),  (d) payments under Precious  Metals Leasing
         other than for the  acquisition  of metals and (e) scheduled  principal
         amounts of all Debt for Borrowed  Money actually paid, in each case, of
         or by the Company and its Subsidiaries during such period.

                  "Existing  Debt"  means  Debt  of  each  Loan  Party  and  its
         Subsidiaries  outstanding  immediately before but not immediately after
         giving effect to the consummation of the  transactions  contemplated by
         the Transaction Documents.

                  "Face Amount" means, with respect to any Bankers'  Acceptance,
         the amount  payable to the holder of such  Bankers'  Acceptance  on its
         then existing Maturity Date.

                  "Facility" means the Term A Facility, the Term B Facility, the
         Delayed Draw Facility, the Multicurrency Facility, the Revolving Credit
         Facility, the Swing Line Facility or the Letter of Credit Facility.

                  "Federal  Funds Rate"  means,  for any period,  a  fluctuating
         interest  rate per annum  equal for each day during  such period to the
         weighted average of the rates on overnight  Federal funds  transactions
         with members of the Federal  Reserve  System  arranged by Federal funds
         brokers,  as published  for such day (or, if such day is not a Business
         Day, for the next preceding  Business Day) by the Federal  Reserve Bank
         of New York, or, if such rate is not so published for any day that is a
         Business  Day,  the  average  of the  quotations  for such day for such
         transactions  received by the  Administrative  Agent from three Federal
         funds brokers of recognized standing selected by it.

                  "Final Maturity Date" means July 30, 2006.




<PAGE>   27


                                       21

                  "Fiscal  Year"  means a  fiscal  year of the  Company  and its
         Consolidated Subsidiaries ending on December 31 in any calendar year.

                  "Deed  of  Charge"  has  the  meaning   specified  in  Section
         3.01(a)(vi).

                  "Fixed  Charge   Coverage   Ratio"  means,   at  any  date  of
         determination,  the ratio of (a)  Consolidated  Adjusted  EBITDA  minus
         Capital Expenditures to (b) the sum of (i) cash interest expense on all
         Debt  for  Borrowed  Money  (net of cash  interest  income)  plus  (ii)
         payments  under  the  Precious   Metals  Leasing  other  than  for  the
         acquisition  of metals plus (iii)  scheduled  principal  amounts of all
         Debt for  Borrowed  Money  actually  paid,  in each case,  of or by the
         Company  and  its  Subsidiaries  during  the  four  consecutive  fiscal
         quarters  most  recently  ended  for  which  financial  statements  are
         required  to be  delivered  to the Lender  Parties  pursuant to Section
         5.03(b) or (c), as the case may be.

                  "Foreign Borrower" has the meaning specified in the recital of
         parties to this Agreement.

                  "Foreign  Currency" means the lawful  currency of Canada,  the
         lawful  currency  of the United  Kingdom,  the lawful  currency  of the
         Kingdom of Denmark,  the lawful  currency of the European  Economic and
         Monetary  Union  and such  other  lawful  currencies  that  are  freely
         transferable or convertible into Dollars as may be agreed by all of the
         Multicurrency Lenders from time to time.

                  "Foreign  Subsidiary"  means a Subsidiary  organized under the
         laws of a  jurisdiction  other  than the  United  States  or any  State
         thereof.

                  "Foreign Subsidiary Guarantors" means all Foreign Subsidiaries
         of the Company (other than  Electro-Connection  Finishers,  Danmark and
         any  Inactive  Subsidiary)  and each other  Foreign  Subsidiary  of the
         Company  that  shall be  required  to  execute  and  deliver a guaranty
         pursuant to Section 5.01(j).

                  "Foreign  Subsidiary  Guaranty"  has the meaning  specified in
         Section 3.01(a)(iii).

                  "GAAP" has the meaning specified in Section 1.03.

                  "Guaranteed  Obligations" has the meaning specified in Section
         7.01.

                  "Guaranties"  means the Domestic  Subsidiary  Guaranty and the
         Foreign Subsidiary Guaranty.




<PAGE>   28


                                       22

                  "Guarantors" means the Domestic Subsidiary  Guarantors and the
         Foreign Subsidiary Guarantors.

                  "Hazardous   Materials"   means  (a)  petroleum  or  petroleum
         products,  by-products or breakdown  products,  radioactive  materials,
         asbestos-containing materials,  polychlorinated biphenyls and radon gas
         and  (b) any  other  chemicals,  materials  or  substances  designated,
         classified  or  regulated  as  hazardous  or toxic or as a pollutant or
         contaminant under any Environmental Law.

                  "Hedge  Agreements"  means  interest rate swap,  cap or collar
         agreements,  interest  rate future or option  contracts,  currency swap
         agreements,  currency future or option  contracts,  commodity future or
         option contracts and other hedging agreements.

                  "Hedge  Bank"  means any  Lender  Party or an  Affiliate  of a
         Lender Party in its capacity as a party to a Secured Hedge Agreement.

                  "Inactive  Subsidiary" means any Subsidiary listed on Schedule
         II and any other  direct or indirect  Subsidiary  of the  Company  with
         assets less than  $2,500,000 as may be certified from time to time by a
         Designated Officer of the Company to the Administrative Agent.

                  "Indemnified  Party"  has the  meaning  specified  in  Section
         9.04(b).

                  "Information  Memorandum"  means the prospectus  dated May 14,
         1998 used by WHX  Corporation in connection  with the offer to exchange
         its 10-1/2% Senior Exchange Notes Due 2005 for its 10-1/2% Senior Notes
         Due 2005.

                  "Initial  Extension  of Credit"  means the earlier to occur of
         the initial  Borrowing  and the initial  issuance of a Letter of Credit
         hereunder.

                  "Initial  Issuing  Banks"  has the  meaning  specified  in the
         recital of parties to this Agreement.

                  "Initial  Lenders" has the meaning specified in the recital of
         parties to this Agreement.

                  "Insufficiency"  means,  with respect to any Plan, the amount,
         if any,  of its  unfunded  benefit  liabilities,  as defined in Section
         4001(a)(18) of ERISA.

                  "Intercreditor  Agreement"  means an  Intercreditor  Agreement
         substantially  in the form of Exhibit O hereto between WHX  Corporation
         or its Subsidiary, Fleet Precious



<PAGE>   29


                                                        23

         Metals Inc. and the Administrative  Agent, as amended from time to time
         in accordance with this Agreement.

                  "Interest Coverage Ratio" means, at any date of determination,
         the ratio of (a)  Consolidated  Adjusted  EBITDA  to (b) cash  interest
         payable on all Debt for Borrowed  Money and payments under the Precious
         Metals Leasing other than for the acquisition of metals,  in each case,
         of or by the Company and its  Subsidiaries  during the four consecutive
         fiscal quarters most recently ended for which financial  statements are
         required  to be  delivered  to the Lender  Parties  pursuant to Section
         5.03(b) or (c), as the case may be.

                  "Interest  Period" means, for each  Eurocurrency  Rate Advance
         comprising  part of the same  Borrowing,  the period  commencing on the
         date of such Eurocurrency Rate Advance or the date of the Conversion of
         any Base Rate Advance into such Eurocurrency  Rate Advance,  and ending
         on the last  day of the  period  selected  by the  applicable  Borrower
         pursuant  to the  provisions  below and,  thereafter,  each  subsequent
         period commencing on the last day of the immediately preceding Interest
         Period  and  ending  on the last  day of the  period  selected  by such
         Borrower  pursuant to the provisions  below.  The duration of each such
         Interest  Period  shall  be one,  two,  three  or six  months,  as such
         Borrower  may,  upon notice  received by the  Administrative  Agent not
         later than 11:00 A.M.  (New York City time) on the third  Business  Day
         prior to the  first  day of such  Interest  Period,  select;  provided,
         however, that:

                           (a) no Borrower may select any  Interest  Period with
                  respect to any Eurocurrency Rate Advance under a Facility that
                  ends after any principal  repayment  installment date for such
                  Facility  unless,  after giving effect to such selection,  the
                  aggregate  principal amount of Base Rate Advances,  Local Rate
                  Advances and of  Eurocurrency  Rate Advances  having  Interest
                  Periods  that  end on or  prior  to such  principal  repayment
                  installment  date for such Facility shall be at least equal to
                  the aggregate principal amount of Advances under such Facility
                  due and payable on or prior to such date;

                           (b) Interest Periods  commencing on the same date for
                  Eurocurrency  Rate  Advances   comprising  part  of  the  same
                  Borrowing shall be of the same duration;

                           (c)  whenever  the  last day of any  Interest  Period
                  would  otherwise occur on a day other than a Business Day, the
                  last day of such Interest Period shall be extended to occur on
                  the next succeeding Business Day, provided,  however, that, if
                  such  extension  would  cause  the last  day of such  Interest
                  Period to occur in the next following calendar month, the last
                  day of such Interest  Period shall occur on the next preceding
                  Business Day; and



<PAGE>   30


                                       24

                           (d)  whenever  the first day of any  Interest  Period
                  occurs on a day of an initial  calendar  month for which there
                  is no numerically corresponding day in the calendar month that
                  succeeds such initial  calendar  month by the number of months
                  equal to the number of months in such  Interest  Period,  such
                  Interest  Period  shall end on the last  Business  Day of such
                  succeeding calendar month.

                  "Internal  Revenue  Code" means the  Internal  Revenue Code of
         1986, as amended from time to time, and the regulations promulgated and
         rulings issued thereunder.

                  "Inventory" means all Inventory referred to in Section 1(b) of
         the Security Agreement.

                  "Investment"  in any Person  means any loan or advance to such
         Person, any purchase or other acquisition of any capital stock or other
         ownership or profit interest, warrants, rights, options, obligations or
         other  securities or the assets  comprising a division or business unit
         or a  substantial  part  or all of the  business  of such  Person,  any
         capital  contribution  to such  Person or any other  direct or indirect
         investment  in  such  Person,   including,   without  limitation,   any
         acquisition  by way of a merger or  consolidation  and any  arrangement
         pursuant to which the investor  incurs Debt of the types referred to in
         clause  (j) or (k) of the  definition  of  "Debt"  in  respect  of such
         Person.

                  "Issuing  Banks" means each Initial Issuing Bank and any other
         Revolving   Credit   Lender   approved  as  an  Issuing   Bank  by  the
         Administrative  Agent and any  Eligible  Assignee  to which a Letter of
         Credit Commitment  hereunder has been assigned pursuant to Section 9.07
         so long as each such  Revolving  Credit  Lender  or each such  Eligible
         Assignee expressly agrees to perform in accordance with their terms all
         of the obligations  that by the terms of this Agreement are required to
         be performed  by it as an Issuing Bank and notifies the  Administrative
         Agent of its Applicable  Lending Office and the amount of its Letter of
         Credit  Commitment   (which   information  shall  be  recorded  by  the
         Administrative Agent in the Register).

                  "L/C Cash Collateral Account" has the meaning specified in the
         Security Agreement.

                  "L/C Related  Documents" has the meaning  specified in Section
         2.05(h)(ii).

                  "Lender Party" means any Lender, any Issuing Bank or the Swing
         Line Bank.

                  "Lenders" means the Initial Lenders and each Person that shall
         become a Lender hereunder  pursuant to Section 9.07 for so long as such
         Initial Lender or Person,  as the case may be, shall be a party to this
         Agreement.



<PAGE>   31


                                       25

                  "Letter  of  Credit  Advance"  means  an  advance  made by any
         Issuing  Bank  or any  Revolving  Credit  Lender  pursuant  to  Section
         2.03(c).

                  "Letter of Credit  Agreement"  has the  meaning  specified  in
         Section 2.03(a).

                  "Letter  of Credit  Commitment"  means,  with  respect  to any
         Issuing Bank at any time,  the Dollar  amount set forth  opposite  such
         Issuing  Bank's name on Schedule I hereto under the caption  "Letter of
         Credit  Commitment"  or, if such  Issuing  Bank has entered into one or
         more Assignment and Acceptances, set forth for such Issuing Bank in the
         Register  maintained by the  Administrative  Agent  pursuant to Section
         9.07(d) as such Issuing Bank's "Letter of Credit  Commitment",  as such
         amount  may be  reduced  at or prior to such time  pursuant  to Section
         2.06.

                  "Letter  of Credit  Facility"  means,  at any time,  an amount
         equal to the lesser of (a) the aggregate  amount of the Issuing  Banks'
         Letter of Credit Commitments at such time and (b) $30,000,000,  as such
         amount  may be  reduced  at or prior to such time  pursuant  to Section
         2.06.

                  "Letters  of  Credit"  has the  meaning  specified  in Section
         2.01(g).

                  "Lien"  means any lien,  security  interest or other charge or
         encumbrance  of any kind,  or any other  similar  type of  preferential
         arrangement,  including,  without  limitation,  the  lien  or  retained
         security title of a conditional  vendor and any easement,  right of way
         or other encumbrance on title to real property.

                  "Loan  Documents" means (a) for purposes of this Agreement and
         the Notes  and any  amendment,  supplement  or  modification  hereof or
         thereof, (i) this Agreement, (ii) the Notes, (iii) the Guaranties, (iv)
         the  Collateral  Documents and (v) each Letter of Credit  Agreement and
         (b) for purposes of the Guaranties and the Collateral Documents and for
         all other  purposes  other than for purposes of this  Agreement and the
         Notes, (i) this Agreement,  (ii) the Notes, (iii) the Guaranties,  (iv)
         the Collateral Documents,  (v) each Letter of Credit Agreement and (vi)
         each Secured Hedge Agreement, in each case as amended.

                  "Loan Parties" means the Borrowers and the Guarantors.

                  "Loan Value" means,  with respect to any Eligible  Collateral,
         an amount  equal to a  percentage  of the value of any item of Eligible
         Collateral  determined by the  Administrative  Agent in its  reasonable
         discretion   consistent  with  its  customary  business  practices  and
         generally applicable criteria for comparable secured financings. By way
         of  example  only,   and  without   limiting  the   discretion  of  the
         Administrative Agent to determine any such


<PAGE>   32


                                       26

         percentage to be applicable,  the Administrative Agent may determine to
         apply,  with respect to all Eligible  Collateral,  the sum of up to the
         following  amounts  and,  with  respect  to a  particular  category  of
         Eligible  Collateral,  up to the following  amount for such category of
         Eligible Collateral:  (a) with respect to Eligible  Receivables,  up to
         85% of the value of Eligible Receivables;  (b) with respect to Eligible
         Inventory (other than Precious Metal Eligible Inventory),  up to 55% of
         the value of such Eligible Inventory;  and (c) with respect to Precious
         Metal Eligible Inventory, up to 80% of the value of such Precious Metal
         Eligible Inventory.

                  "Local  Rate"  means  (a) with  respect  to any  Multicurrency
         Advance  denominated  in any  Foreign  Currency  (other  than  Canadian
         Dollars),  the rate of interest from time to time publicly announced by
         Citibank in the  jurisdiction  of issuance of such Foreign  Currency as
         its base rate (or its equivalent thereof) for loans denominated in such
         Foreign  Currency at the  principal  lending  office of Citibank in the
         jurisdiction of issuance of such Foreign Currency, and (b) with respect
         to any  Multicurrency  Advance  denominated  in Canadian  Dollars,  the
         Canadian Prime Rate.

                  "Local Rate  Advance"  shall mean each  Multicurrency  Advance
         hereunder at such time as it is made or being  maintained  at a rate of
         interest based upon the Local Rate for the relevant Foreign Currency.

                  "Local  Rate  Lending  Office"  means,  with  respect  to  any
         Multicurrency  Lender for any Foreign  Currency  (other  than  Canadian
         Dollars)  the office of such  Lender  specified  by such  Lender to the
         Borrowers  and the  Administrative  Agent  from  time to time  for such
         Foreign  Currency  and,  in the case of any  Multicurrency  Lender  for
         Canadian Dollars, such Lender's Canadian Domestic Lending Office.

                  "Management Agreement" means the Management Agreement dated as
         of April 13,  1998  between  the  Company  and WHX  Corporation  or its
         Affiliates,  as amended from time to time to the extent permitted under
         the Loan Documents.

                  "Margin Stock" has the meaning specified in Regulation U.

                  "Material Adverse Change" means any material adverse change in
         the  business,   condition   (financial  or   otherwise),   operations,
         performance,   properties   or   prospects   of  the  Company  and  its
         Subsidiaries, taken as a whole.

                  "Material  Adverse Effect" means a material  adverse effect on
         (a) the  business,  condition  (financial  or  otherwise),  operations,
         performance,   properties   or   prospects   of  the  Company  and  its
         Subsidiaries,  taken as a whole,  (b) the  rights and  remedies  of any
         Agent or any Lender  Party  under any  Transaction  Document or (c) the
         ability of any Loan Party



<PAGE>   33


                                                        27

         to perform its Obligations  under any Transaction  Document to which it
         is or is to be a party.

                  "Maturity Date" means, for each Bankers' Acceptance comprising
         part of the same  Drawing,  the date on which  the Face  Amount of such
         Bankers'  Acceptance  becomes  due and payable in  accordance  with the
         provisions  set forth below,  which shall be a Business  Day  occurring
         one, two or three months or, if available to all Multicurrency  Lenders
         purchasing  Bankers'  Acceptances  in  connection  with the  applicable
         Drawing, six months after the date on which such Bankers' Acceptance is
         purchased  and/or  accepted  as part of any  Drawing,  as the  Canadian
         Borrower may select upon notice  received by the  Administrative  Agent
         not later  than 10:00  a.m.  (New York City time) on a Business  Day at
         least  three  Business  Days prior to the date on which  such  Bankers'
         Acceptance is to be accepted and  purchased  (whether as a new Drawing,
         by renewal or by Conversion); provided, however, that:

                           (a) such  Borrower may not select any  Maturity  Date
                  for any Bankers'  Acceptance  that occurs after the  scheduled
                  Termination Date;

                           (b) the Maturity  Date for all  Bankers'  Acceptances
                  comprising  part of the same  Drawing  shall occur on the same
                  date; and

                           (c)  whenever  the  Maturity  Date  for any  Bankers'
                  Acceptance  would  otherwise  occur  on a  day  other  than  a
                  Business Day, such Maturity Date shall be extended to occur on
                  the next succeeding Business Day.

                  "Mortgages" has the meaning specified in Section 3.01(a)(iv).

                  "Mortgage  Policies"  has the  meaning  specified  in  Section
         3.01(a)(iv)(B).

                  "Multicurrency  Advance" has the meaning  specified in Section
         2.01(d).

                  "Multicurrency  Borrowing"  means a  borrowing  consisting  of
         simultaneous  Multicurrency  Advances in the same  currency of the same
         Type made by the Multicurrency Lenders.

                  "Multicurrency   Commitment"   means,   with  respect  to  any
         Multicurrency  Lender at any time, the Dollar amount set forth opposite
         such   Lender's   name  on   Schedule  I  hereto   under  the   caption
         "Multicurrency  Commitment"  or, if such Lender has entered into one or
         more  Assignment  and  Acceptances,  set forth  for such  Lender in the
         Register  maintained by the  Administrative  Agent  pursuant to Section
         9.07(d) as such Lender's "Multicurrency



<PAGE>   34


                                       28

         Commitment",  as such  amount  may be  reduced at or prior to such time
         pursuant to Section 2.06.

                  "Multicurrency  Facility"  means,  at any time,  the aggregate
         amount of the Multicurrency Lenders' Multicurrency  Commitments at such
         time.

                  "Multicurrency   Lender"   means   any   Lender   that  has  a
         Multicurrency Commitment and a Revolving Credit Commitment.

                  "Multicurrency  Note" means a  promissory  note of the Company
         payable to the order of any Multicurrency  Lender, in substantially the
         form of Exhibit A-4 hereto,  evidencing the aggregate  indebtedness  of
         the Company to such Lender  resulting from the  Multicurrency  Advances
         made by such Lender, as amended.

                  "Multicurrency  Reduction Amount" has the meaning specified in
         Section 2.07(b)(xi).

                  "Multiemployer Plan" means a multiemployer plan, as defined in
         Section  4001(a)(3)  of  ERISA,  to which  any Loan  Party or any ERISA
         Affiliate is making or accruing an obligation to make contributions, or
         has  within  any of the  preceding  five plan  years made or accrued an
         obligation to make contributions.

                  "Multiple  Employer  Plan" means a single  employer  plan,  as
         defined in Section  4001(a)(15)  of ERISA,  that (a) is maintained  for
         employees  of any Loan  Party or any ERISA  Affiliate  and at least one
         Person other than the Loan Parties and the ERISA  Affiliates or (b) was
         so  maintained  and in  respect  of which  any Loan  Party or any ERISA
         Affiliate  could have liability  under Section 4064 or 4069 of ERISA in
         the event such plan has been or were to be terminated.

                  "Net Cash Proceeds"  means,  with respect to any sale,  lease,
         transfer or other  disposition  of any asset or the sale or issuance of
         any Debt or  capital  stock  or  other  ownership  or  profit  interest
         (including,   without  limitation,   any  capital  contribution),   any
         securities  convertible into or exchangeable for capital stock or other
         ownership or profit interest or any warrants,  rights, options or other
         securities  to  acquire  capital  stock or other  ownership  or  profit
         interest by any Person, the aggregate amount of cash received from time
         to time  (whether  as  initial  consideration  or  through  payment  or
         disposition of deferred  consideration)  by or on behalf of such Person
         in connection  with such  transaction  after  deducting  therefrom only
         (without   duplication)   (a)   reasonable   and  customary   brokerage
         commissions, underwriting fees and discounts, legal fees, finder's fees
         and other similar fees and commissions, (b) the amount of taxes payable
         in  connection  with  or as a  result  of such  transaction  (including
         payments required under the Tax Agreement) and



<PAGE>   35


                                       29

         (c) the amount of any Debt secured by a Lien on such asset that, by the
         terms of the agreement or instrument  governing  such Debt, is required
         to be repaid upon such  disposition,  in each case to the  extent,  but
         only to the extent,  that the  amounts so deducted  are, at the time of
         receipt  of  such  cash,  actually  paid  to a  Person  that  is not an
         Affiliate of such Person or any Loan Party or any Affiliate of any Loan
         Party and are properly attributable to such transaction or to the asset
         that is the subject  thereof;  provided,  however,  that in the case of
         taxes that are deductible under clause (b) above but for the fact that,
         at the time of receipt of such cash,  such taxes have not been actually
         paid or are not then payable,  such Loan Party or such  Subsidiary  may
         deduct an amount (the "Reserved  Amount") equal to the amount  reserved
         in  accordance  with GAAP for such Loan  Party's  or such  Subsidiary's
         reasonable estimate of such taxes, other than taxes for which such Loan
         Party or such Subsidiary is  indemnified,  provided  further,  however,
         that,  at the time such taxes are paid,  an amount equal to the amount,
         if any, by which the Reserved  Amount for such taxes exceeds the amount
         of such taxes actually paid shall constitute "Net Cash Proceeds" of the
         type for which such taxes were reserved for all purposes hereunder.

                  "Note"  means a Term A Note,  a Term B Note,  a  Delayed  Draw
         Note, a Multicurrency Note or a Revolving Credit Note.

                  "Notice of  Borrowing"  has the meaning  specified  in Section
         2.02(a).

                  "Notice  of  Drawing"  has the  meaning  specified  in Section
         2.04(a).

                  "Notice of  Issuance"  has the  meaning  specified  in Section
         2.03(a).

                  "Notice  of  Renewal"  has the  meaning  specified  in Section
         2.01(g).

                  "Notice of Swing Line Borrowing" has the meaning  specified in
         Section 2.02(b).

                  "Notice of Termination"  has the meaning  specified in Section
         2.01(g).

                  "NPL" means the National Priorities List under CERCLA.

                  "Obligation"  means, with respect to any Person,  any payment,
         performance or other obligation of such Person of any kind,  including,
         without limitation,  any liability of such Person on any claim, whether
         or not the right of any creditor to payment in respect of such claim is
         reduced  to  judgment,  liquidated,  unliquidated,  fixed,  contingent,
         matured, disputed,  undisputed, legal, equitable, secured or unsecured,
         and  whether  or not such  claim is  discharged,  stayed  or  otherwise
         affected  by any  proceeding  referred to in Section  6.01(f).  Without
         limiting the generality of the foregoing, the Obligations of any



<PAGE>   36


                                       30

         Loan Party under the Loan  Documents  include (a) the obligation to pay
         principal,  interest, Letter of Credit commissions,  charges, expenses,
         fees, attorneys' fees and disbursements,  indemnities and other amounts
         payable  by  such  Loan  Party  under  any  Loan  Document  and (b) the
         obligation of such Loan Party to reimburse any amount in respect of any
         of the foregoing that any Lender Party,  in its reasonable  discretion,
         may elect to pay or advance on behalf of such Loan Party.

                  "OECD" means the  Organization  for Economic  Cooperation  and
         Development.

                  "Open Year" has the meaning specified in Section 4.01(r)(ii).

                  "Other Taxes" has the meaning specified in Section 2.14(b).

                  "Payment Office" means, for any Foreign Currency,  such office
         of   Citibank   as  shall  be  from  time  to  time   selected  by  the
         Administrative  Agent and notified by the  Administrative  Agent to the
         Borrowers and the Lender Parties.

                  "PBGC" means the Pension Benefit Guaranty  Corporation (or any
         successor).

                  "Permitted  Encumbrances"  has the  meaning  specified  in the
         Mortgages.

                  "Permitted Liens" means: (a) Liens for taxes,  assessments and
         governmental  charges or levies to the extent not  required  to be paid
         under Section 5.01(b); (b) Liens imposed by law, such as materialmen's,
         mechanics',  carriers',  workmen's  and  repairmen's  Liens  and  other
         similar  Liens  arising in the  ordinary  course of  business  securing
         obligations that are not overdue for a period of more than 60 days; (c)
         pledges or deposits to secure  obligations under workers'  compensation
         laws  or  similar   legislation   or  to  secure  public  or  statutory
         obligations; and (d) Permitted Encumbrances.

                  "Person"   means  an  individual,   partnership,   corporation
         (including a business trust),  limited liability  company,  joint stock
         company,  trust,  unincorporated  association,  joint  venture or other
         entity, or a government or any political subdivision or agency thereof.

                  "Plan"  means a Single  Employer  Plan or a Multiple  Employer
         Plan.

                  "Pledged  Debt"  has the  meaning  specified  in the  Security
         Agreement.

                  "Precious Metal Eligible  Inventory" means Eligible  Inventory
         consisting of any precious metals including,  without limitation, gold,
         silver, palladium and platinum group metals.




<PAGE>   37


                                       31

                  "Precious Metal Inventory"  means Inventory  consisting of any
         precious metals including,  without limitation, gold, silver, palladium
         and platinum group metals.

                  "Precious  Metals  Leasing" means a precious metals leasing or
         other  facility   designed  to  provide  the  Company  or  any  of  its
         Subsidiaries   with  precious   metals  to  be  used  in  its  business
         operations.

                  "Preferred  Stock"  means,  with  respect to any  corporation,
         capital  stock  issued  by  such  corporation  that  is  entitled  to a
         preference  or priority  over any other  capital  stock  issued by such
         corporation upon any distribution of such corporation's assets, whether
         by dividend or upon liquidation.

                  "Pro Rata  Share" of any  amount  means,  with  respect to any
         Revolving Credit Lender at any time, the product of such amount times a
         fraction  the  numerator  of  which  is the  amount  of  such  Lender's
         Revolving  Credit  Commitment at such time (or, if the Revolving Credit
         Commitments  shall have been  terminated  pursuant  to Section  2.06 or
         6.01,  such  Lender's   Revolving   Credit   Commitment  as  in  effect
         immediately  prior to such termination) and the denominator of which is
         the  Revolving  Credit  Facility at such time (or,  if the  Commitments
         shall  have been  terminated  pursuant  to  Section  2.06 or 6.01,  the
         Revolving  Credit  Facility  as in  effect  immediately  prior  to such
         termination).

                  "Receivables"  means all  Receivables  referred  to in Section
         1(c) of the Security Agreement.

                  "Redeemable" means, with respect to any capital stock or other
         ownership or profit  interest,  Debt or other right or Obligation,  any
         such right or Obligation  that (a) the issuer has  undertaken to redeem
         at a fixed or  determinable  date or dates,  whether by  operation of a
         sinking fund or  otherwise,  or upon the  occurrence of a condition not
         solely  within the  control of the issuer or (b) is  redeemable  at the
         option of the holder.

                  "Reduction  Amount"  has  the  meaning  specified  in  Section
         2.07(b)(viii).

                  "Reference  Banks" means  Citibank  and such other  Lenders as
         shall be appointed from time to time by the Company with the consent of
         the Administrative Agent.

                  "Register" has the meaning specified in Section 9.07(d).

                  "Regulation U" means Regulation U of the Board of Governors of
         the Federal Reserve System, as in effect from time to time.




<PAGE>   38


                                       32

                  "Related  Documents"  means  the  Management  Agreement,   any
         intercompany  notes  issued  pursuant to Section  5.02(b)(ii),  the Tax
         Agreement and the Intercreditor Agreement.

                  "Required  Lenders" means,  at any time,  Lenders (voting as a
         single  class)  owed or holding at least a majority  in interest of the
         sum of (a)  the  aggregate  principal  amount  (based,  in the  case of
         Multicurrency  Advances,  on the Equivalent in Dollars at such time) of
         the Advances  outstanding  at such time,  (b) the  aggregate  Available
         Amount of all  Letters  of Credit  outstanding  at such  time,  (c) the
         aggregate  unused  Commitments  under the Delayed Draw Facility at such
         time, (d) the aggregate  Unused  Revolving  Credit  Commitments at such
         time and (e) the aggregate  Unused  Multicurrency  Commitments  at such
         time;  provided,  however,  that if any  Lender  shall be a  Defaulting
         Lender at such time, there shall be excluded from the  determination of
         Required  Lenders  at such  time  (A) the  aggregate  principal  amount
         (based,  in the case of  Multicurrency  Advances,  on the Equivalent in
         Dollars  at such  time) of the  Advances  owing to such  Lender (in its
         capacity as a Lender) and  outstanding  at such time, (B) such Lender's
         Pro Rata  Share of the  aggregate  Available  Amount of all  Letters of
         Credit  outstanding  at such  time,  (C) the  aggregate  unused  Term A
         Commitments,   Term  B  Commitments,   Delayed  Draw   Commitments  and
         Multicurrency  Commitments  of such  Lender  at such  time  and (D) the
         Unused  Revolving  Credit  Commitment of such Lender at such time.  For
         purposes of this  definition,  the aggregate  principal amount of Swing
         Line  Advances  owing to the  Swing  Line  Bank and of Letter of Credit
         Advances  owing to any Issuing  Bank and the  Available  Amount of each
         Letter of Credit shall be considered to be owed to the Revolving Credit
         Lenders ratably in accordance with their  respective  Revolving  Credit
         Commitments.

                  "Responsible Officer" means any officer of any Loan Party.

                  "Revolving  Credit  Advance"  has  the  meaning  specified  in
         Section 2.01(e).

                  "Revolving Credit  Borrowing" means a borrowing  consisting of
         simultaneous  Revolving  Credit  Advances  of the same Type made by the
         Revolving Credit Lenders.

                  "Revolving  Credit  Commitment"  means,  with  respect  to any
         Revolving  Credit  Lender  at any time,  the  Dollar  amount  set forth
         opposite  such  Lender's  name on  Schedule I hereto  under the caption
         "Revolving  Credit  Commitment" or, if such Lender has entered into one
         or more  Assignment and  Acceptances,  set forth for such Lender in the
         Register  maintained by the  Administrative  Agent  pursuant to Section
         9.07(d) as such Lender's "Revolving Credit Commitment",  as such amount
         may be reduced at or prior to such time pursuant to Section 2.06.




<PAGE>   39


                                       33

                  "Revolving  Credit Facility" means, at any time, the aggregate
         amount of the Revolving Credit Lenders' Revolving Credit Commitments at
         such time.

                  "Revolving   Credit  Lender"  means  any  Lender  that  has  a
         Revolving Credit Commitment.

                  "Revolving Credit Note" means a promissory note of the Company
         payable to the order of any Revolving  Credit Lender,  in substantially
         the form of Exhibit A-5 hereto,  evidencing the aggregate  indebtedness
         of the  Company to such  Lender  resulting  from the  Revolving  Credit
         Advances made by such Lender, as amended.

                  "Secured Hedge Agreement"  means any Hedge Agreement  required
         or permitted under clause (i)(A) or (iii)(G) of Section 5.02(b) that is
         entered into by and between any Loan Party and any Hedge Bank.

                  "Secured   Obligations"  has  the  meaning  specified  in  the
         Security Agreement.

                  "Secured Parties" means the Agents, the Lender Parties and the
         Hedge Banks.

                  "Security  Agreement"  has the  meaning  specified  in Section
         3.01(a)(ii).

                  "Senior  Leverage Ratio" means, at any date of  determination,
         the ratio of (a)  Consolidated  Debt for  Borrowed  Money  (other  than
         Subordinated  Debt) minus (b) the sum of (i) cash and Cash  Equivalents
         and (ii) an amount  equal to forty  percent of the fair market value of
         the  Precious  Metal  Inventory,  in each case of the  Company  and its
         Subsidiaries as at the end of the most recently ended fiscal quarter of
         the Company for which financial statements are required to be delivered
         to the Lender Parties  pursuant to Section  5.03(b) or (c), as the case
         may  be,  to  Consolidated  Adjusted  EBITDA  of the  Company  and  its
         Subsidiaries  for the  twelve-month  period ended as at the end of such
         fiscal quarter.

                  "Single  Employer  Plan"  means a  single  employer  plan,  as
         defined in Section  4001(a)(15)  of ERISA,  that (a) is maintained  for
         employees of any Loan Party or any ERISA  Affiliate and no Person other
         than the Loan Parties and the ERISA Affiliates or (b) was so maintained
         and in  respect of which any Loan  Party or any ERISA  Affiliate  could
         have  liability  under Section 4069 of ERISA in the event such plan has
         been or were to be terminated.

                  "Solvent" and "Solvency" mean, with respect to any Person on a
         particular  date,  that on such date (a) the fair value of the property
         of such  Person  is  greater  than the  total  amount  of  liabilities,
         including, without limitation, contingent liabilities, of such Person,



<PAGE>   40


                                       34

         (b) the present fair salable  value of the assets of such Person is not
         less  than  the  amount  that  will be  required  to pay  the  probable
         liability  of such  Person on its  debts as they  become  absolute  and
         matured,  (c) such Person does not intend to, and does not believe that
         it will, incur debts or liabilities beyond such Person's ability to pay
         such debts and  liabilities  as they  mature and (d) such Person is not
         engaged in  business  or a  transaction,  and is not about to engage in
         business  or a  transaction,  for which such  Person's  property  would
         constitute  an  unreasonably  small  capital.  The amount of contingent
         liabilities  at any time shall be computed as the amount  that,  in the
         light  of all the  facts  and  circumstances  existing  at  such  time,
         represents  the amount  that can  reasonably  be  expected to become an
         actual or matured liability.

                  "Sub-Agent"  means,  in the case of Bankers'  Acceptances  and
         Multicurrency Advances denominated in Canadian Dollars, Citibank Canada
         and, in the case of  Multicurrency  Advances  denominated  in any other
         Foreign Currency, Citibank, N.A.

                  "Subordinated  Debt"  means  any Debt of the  Company  that is
         subordinated to the Obligations of the Company under the Loan Documents
         substantially on the terms and conditions set forth in Exhibit N hereto
         with such other terms and conditions that may be reasonably  acceptable
         to the  Administrative  Agent or  otherwise  or as permitted by Section
         5.02(b)(i)(B).

                  "Subsidiary" of any Person means any corporation, partnership,
         joint venture,  limited liability company, trust or estate of which (or
         in which) more than 50% of (a) the issued and outstanding capital stock
         having  ordinary  voting  power to  elect a  majority  of the  Board of
         Directors  of such  corporation  (irrespective  of  whether at the time
         capital stock of any other class or classes of such  corporation  shall
         or might have voting power upon the occurrence of any contingency), (b)
         the  interest  in the  capital or profits  of such  partnership,  joint
         venture or limited liability company or (c) the beneficial  interest in
         such trust or estate is at the time  directly  or  indirectly  owned or
         controlled by such Person,  by such Person and one or more of its other
         Subsidiaries or by one or more of such Person's other Subsidiaries.

                  "Subsidiary  Guaranty"  has the meaning  specified  in Section
         3.01(a)(iii).

                  "Surviving  Debt"  means  Debt  of  each  Loan  Party  and its
         Subsidiaries  outstanding immediately before and after giving effect to
         the transactions contemplated by the Transaction Documents.

                  "Swing Line  Advance"  means an advance  made by (a) the Swing
         Line Bank  pursuant  to  Section  2.01(f) or (b) any  Revolving  Credit
         Lender pursuant to Section 2.02(b).



<PAGE>   41


                                       35

                  "Swing Line Bank" means Citicorp.

                  "Swing Line Borrowing" means a borrowing consisting of a Swing
         Line Advance made by the Swing Line Bank pursuant to Section 2.01(f) or
         the Revolving Credit Lenders pursuant to Section 2.02(b).

                  "Swing Line  Facility"  has the meaning  specified  in Section
         2.01(f).

                  "Tax Agreement"  means the Tax Sharing  Agreement  between WHX
         Corporation and the Company, dated as of April 13, 1998, as amended, to
         the extent permitted under the Loan Documents.

                  "Tax Certificate" has the meaning specified in Section 5.03(k)

                  "Taxes" has the meaning specified in Section 2.14(a).

                  "Term A Advance" has the meaning specified in Section 2.01(a).

                  "Term  A   Borrowing"   means  a   borrowing   consisting   of
         simultaneous  Term A  Advances  of the  same  Type  made by the  Term A
         Lenders.

                  "Term A Commitment"  means,  with respect to any Term A Lender
         at any time, the Dollar amount set forth opposite such Lender's name on
         Schedule I hereto  under the caption  "Term A  Commitment"  or, if such
         Lender has entered into one or more  Assignment  and  Acceptances,  set
         forth for such Lender in the Register  maintained by the Administrative
         Agent pursuant to Section 9.07(d) as such Lender's "Term A Commitment",
         as such  amount  may be reduced  at or prior to such time  pursuant  to
         Section 2.06.

                  "Term A Facility"  means, at any time, the aggregate amount of
         the Term A Lenders' Term A Commitments at such time.

                  "Term A Lender" means any Lender that has a Term A Commitment.

                  "Term A Note" means a promissory  note of the Company  payable
         to the order of any Term A Lender, in substantially the form of Exhibit
         A-1 hereto,  evidencing the  indebtedness of the Company to such Lender
         resulting from the Term A Advance made by such Lender, as amended.

                  "Term B Advance" has the meaning specified in Section 2.01(b).



<PAGE>   42


                                       36

                  "Term  B   Borrowing"   means  a   borrowing   consisting   of
         simultaneous  Term B  Advances  of the  same  Type  made by the  Term B
         Lenders.

                  "Term B Commitment"  means,  with respect to any Term B Lender
         at any time, the Dollar amount set forth opposite such Lender's name on
         Schedule I hereto  under the caption  "Term B  Commitment"  or, if such
         Lender has entered into one or more  Assignment  and  Acceptances,  set
         forth for such Lender in the Register  maintained by the Administrative
         Agent pursuant to Section 9.07(d) as such Lender's "Term B Commitment",
         as such  amount  may be reduced  at or prior to such time  pursuant  to
         Section 2.06.

                  "Term B Facility"  means, at any time, the aggregate amount of
         the Term B Lenders' Term B Commitments at such time.

                  "Term B Lender" means any Lender that has a Term B Commitment.

                  "Term B Note" means a promissory  note of the Company  payable
         to the order of any Term B Lender, in substantially the form of Exhibit
         A-2 hereto,  evidencing the  indebtedness of the Company to such Lender
         resulting from the Term B Advance made by such Lender, as amended.

                  "Termination Date" means the earlier of July 30, 2004, and the
         date of termination in whole of the Revolving Credit  Commitments,  the
         Letter of Credit Commitments and the Multicurrency Commitments pursuant
         to Section 2.06 or 6.01.

                  "Total Leverage  Ratio" means,  at any date of  determination,
         the ratio of (a) Consolidated Debt for Borrowed Money minus (b) the sum
         of (i) cash  and Cash  Equivalents  and (ii) an  amount  equal to forty
         percent of the fair market value of the Precious  Metal  Inventory,  in
         each case of the Company and its Subsidiaries as at the end of the most
         recently  ended  fiscal  quarter  of the  Company  for which  financial
         statements are required to be delivered to the Lender Parties  pursuant
         to Section 5.03(b) or (c), as the case may be, to Consolidated Adjusted
         EBITDA of the Company and its Subsidiaries for the twelve-month  period
         ended as at the end of such fiscal quarter.

                  "Transaction   Documents"   means,   collectively,   the  Loan
         Documents and the Related Documents.

                  "Type"  refers to the  distinction  between  Advances  bearing
         interest at the Base Rate,  Advances bearing interest at the applicable
         Local Rate and Advances bearing interest at the Eurocurrency Rate.




<PAGE>   43


                                       37

                  "Unused Asset Sale Proceeds Amount" means the aggregate amount
         of Net  Cash  Proceeds  required  to be  prepaid  pursuant  to  Section
         2.06(b)(ii)  prior to the time such amount is prepaid or  reinvested in
         accordance  with the terms of such Section  unless such amount shall be
         deposited in the Cash  Collateral  Account  pending such  prepayment or
         reinvestment.

                  "Unused  Multicurrency  Commitment" means, with respect to any
         Multicurrency  Lender  at any  time  (a)  such  Lender's  Multicurrency
         Commitment  at  such  time  minus  (b)  the  sum of (i)  the  aggregate
         principal amount of all Multicurrency  Advances made by such Lender (or
         the  Equivalent  thereof in Dollars,  if  applicable),  (ii) the Dollar
         Equivalent  of the  aggregate  Face Amount of all Bankers'  Acceptances
         purchased  and/or  accepted by such Lender and outstanding at such time
         and  (iii)  such   Lender's   ratable   share  of  the  amount  of  the
         Multicurrency Facility then reserved pursuant to Section 2.01(i).

                  "Unused  Revolving Credit  Commitment"  means, with respect to
         any Revolving  Credit Lender at any time,  (a) such Lender's  Revolving
         Credit  Commitment  at such time minus (b) the sum of (i) the aggregate
         principal amount of all Revolving Credit Advances,  Swing Line Advances
         and Letter of Credit Advances made by such Lender (in its capacity as a
         Lender) and  outstanding  at such time plus (ii) such Lender's Pro Rata
         Share of (A) the  aggregate  Available  Amount of all Letters of Credit
         outstanding  at such time,  (B) the aggregate  principal  amount of all
         Letter of Credit Advances made by the Issuing Banks pursuant to Section
         2.03(c)  and  outstanding  at such time,  (C) the  aggregate  principal
         amount of all Swing Line  Advances made by the Swing Line Bank pursuant
         to  Section  2.01(f)  and  outstanding  at such time and (D) the Unused
         Asset Sale Proceeds Amount plus (iii) in the case of a Revolving Credit
         Lender that is a  Multicurrency  Lender,  such  Lender's  Multicurrency
         Commitment.

                  "Voting Stock" means capital stock issued by a corporation, or
         equivalent  interests  in any other  Person,  the  holders of which are
         ordinarily,  in the absence of contingencies,  entitled to vote for the
         election of directors (or persons performing similar functions) of such
         Person,  even  if the  right  so to  vote  has  been  suspended  by the
         happening of such a contingency.

                  "Welfare  Plan"  means a welfare  plan,  as defined in Section
         3(1) of ERISA, that is maintained for employees of any Loan Party or in
         respect of which any Loan Party could have liability.

                  "Withdrawal  Liability" has the meaning specified in Part I of
         Subtitle E of Title IV of ERISA.




<PAGE>   44


                                                        38

                  SECTION 1.02.  Computation of Time Periods; Other Definitional
Provisions. In this Agreement and the other Loan Documents in the computation of
periods of time from a specified date to a later specified date, the word "from"
means  "from and  including"  and the words "to" and  "until"  each mean "to but
excluding".  References  in the Loan  Documents to any agreement or contract "as
amended" shall mean and be a reference to such agreement or contract as amended,
amended and restated,  supplemented  or otherwise  modified from time to time in
accordance with its terms.

                  SECTION  1.03.  Accounting  Terms.  All  accounting  terms not
specifically  defined  herein shall be construed in  accordance  with  generally
accepted accounting  principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.01(g) ("GAAP").


                                   ARTICLE II

                              AMOUNTS AND TERMS OF
                       THE ADVANCES, THE LETTERS OF CREDIT
                          AND THE BANKERS' ACCEPTANCES

                  SECTION 2.01. The Advances and the Letters of Credit.  (a) The
Term A  Advances.  Each  Term A  Lender  severally  agrees,  on  the  terms  and
conditions  hereinafter set forth, to make a single advance (a "Term A Advance")
to the Company on the date of the Initial  Extension  of Credit in an amount not
to exceed such  Lender's  Term A Commitment  at such time.  The Term A Borrowing
shall  consist  of Term A  Advances  made  simultaneously  by the Term A Lenders
ratably  according  to their Term A  Commitments.  Amounts  borrowed  under this
Section 2.01(a) and repaid or prepaid may not be reborrowed.

                  (b) The Term B Advances.  Each Term B Lender severally agrees,
on the terms and conditions  hereinafter  set forth, to make a single advance (a
"Term B Advance") to the Company on the date of the Initial  Extension of Credit
in an amount not to exceed such  Lender's  Term B Commitment  at such time.  The
Term B Borrowing  shall  consist of Term B Advances made  simultaneously  by the
Term B Lenders ratably  according to their Term B Commitments.  Amounts borrowed
under this Section 2.01(b) and repaid or prepaid may not be reborrowed.

                  (c) The  Delayed  Draw  Advances.  Each  Delayed  Draw  Lender
severally  agrees,  on the terms and conditions  hereinafter  set forth, to make
advances  (each,  a "Delayed Draw  Advance") to the Company from time to time on
any  Business  Day during the period from the date hereof  until the  Conversion
Date in an amount not to exceed such Lender's  unused Delayed Draw Commitment at
such time.  Each  Delayed  Draw  Borrowing  shall be in an  aggregate  amount of
$2,500,000 or an integral multiple of $500,000 in excess thereof and shall



<PAGE>   45


                                       39

consist of Delayed Draw Advances made simultaneously by the Delayed Draw Lenders
ratably according to their Delayed Draw Commitments. Amounts borrowed under this
Section 2.01(c) and repaid or prepaid may not be reborrowed.

                  (d) The  Multicurrency  Advances.  Each  Multicurrency  Lender
severally  agrees,  on the terms and conditions  hereinafter  set forth, to make
advances (each a "Multicurrency Advance") to the Company or any Foreign Borrower
from time to time on any  Business  Day during the period  from the date  hereof
until the  Termination  Date in an aggregate  amount (based on the Equivalent in
Dollars  determined  on the  date  of  delivery  of  the  applicable  Notice  of
Borrowing) not to exceed at any time  outstanding  such  Multicurrency  Lender's
Unused Multicurrency Commitment at such time. Each Multicurrency Borrowing shall
be in an  aggregate  amount of $50,000  or an  integral  multiple  of $10,000 in
excess thereof (or the Equivalent thereof in any Foreign Currency  determined on
the date of delivery of the applicable Notice of Borrowing) and shall consist of
Multicurrency  Advances of the same Type,  in the same  currency and made on the
same day by the  Multicurrency  Lenders  ratably  according to their  respective
Multicurrency  Commitments.  Within  the limits of each  Multicurrency  Lender's
Unused Multicurrency Commitment in effect from time to time, the Company and the
Foreign  Borrowers  may borrow under this Section  2.01(d),  prepay  pursuant to
Section 2.07(a) and reborrow under this Section 2.01(d).

                  (e) The  Revolving  Credit  Advances.  Each  Revolving  Credit
Lender severally agrees,  on the terms and conditions  hereinafter set forth, to
make advances  (each a "Revolving  Credit  Advance") to the Company from time to
time on any  Business  Day  during  the period  from the date  hereof  until the
Termination  Date in an amount for each such Advance not to exceed such Lender's
Unused Revolving Credit Commitment at such time. Each Revolving Credit Borrowing
shall be in an  aggregate  amount  of  $5,000,000  or an  integral  multiple  of
$1,000,000 in excess thereof and shall consist of Revolving Credit Advances made
simultaneously  by the  Revolving  Credit  Lenders  ratably  according  to their
Revolving  Credit  Commitments.  Within  the  limits  of each  Revolving  Credit
Lender's  Unused  Revolving  Credit  Commitment in effect from time to time, the
Company  may borrow  under this  Section  2.01(e),  prepay  pursuant  to Section
2.07(a) and reborrow under this Section 2.01(e).

                  (f) The Swing Line Advances. The Company may request the Swing
Line Bank to make, and the Swing Line Bank may, if in its reasonable  discretion
it elects to do so, make,  on the terms and  conditions  hereinafter  set forth,
Swing Line  Advances to the Company from time to time on any Business Day during
the period from the date hereof until the  Termination  Date (i) in an aggregate
amount  not to exceed  at any time  outstanding  $10,000,000  (the  "Swing  Line
Facility")  and (ii) in an amount  for each such  Swing  Line  Borrowing  not to
exceed the aggregate of the Unused Revolving Credit Commitments of the Revolving
Credit Lenders at such time. No Swing Line Advance shall be used for the purpose
of funding the payment of principal of any other Swing Line Advance.  Each Swing
Line Borrowing shall be in



<PAGE>   46


                                       40

an amount of $100,000 or an integral  multiple of $10,000 in excess  thereof and
shall be made as a Base Rate  Advance.  Within  the  limits  of the  Swing  Line
Facility and within the limits  referred to in clause (ii) above, so long as the
Swing  Line  Bank,  in its  reasonable  discretion,  elects to make  Swing  Line
Advances,  the Company may borrow under this Section 2.01(f),  repay pursuant to
Section  2.05(g) or prepay  pursuant to Section  2.07(a) and reborrow under this
Section 2.01(f).

                  (g) Letters of Credit.  Each Issuing Bank severally agrees, on
the terms and conditions  hereinafter set forth, to issue letters of credit (the
"Letters  of Credit")  for the  account of the Company  from time to time on any
Business  Day during the period  from the date  hereof  until 60 days before the
Termination Date in an aggregate  Available Amount (i) for all Letters of Credit
issued by such  Issuing  Bank not to  exceed  at any time the  lesser of (x) the
Letter of Credit  Facility at such time and (y) such  Issuing  Bank's  Letter of
Credit  Commitment  at such time and (ii) for each such  Letter of Credit not to
exceed the Unused Revolving  Credit  Commitments of the Revolving Credit Lenders
at such time. No Letter of Credit shall have an expiration  date  (including all
rights of the  Company or the  beneficiary  to require  renewal)  later than the
earlier of 60 days  before the  Termination  Date and one year after the date of
issuance  thereof , but may by its terms be  renewable  annually  upon notice (a
"Notice of Renewal") given to the Issuing Bank that issued such Letter of Credit
and the  Administrative  Agent on or prior to any date for notice of renewal set
forth in such  Letter of Credit but in any event at least  three  Business  Days
prior to the date of the  proposed  renewal  of such  Letter of Credit  and upon
fulfillment  of the  applicable  conditions set forth in Article III unless such
Issuing Bank has notified the Company (with a copy to the Administrative  Agent)
on or prior to the date for notice of  termination  set forth in such  Letter of
Credit but in any event at least 30 Business Days prior to the date of automatic
renewal  of its  election  not to renew  such  Letter of Credit  (a  "Notice  of
Termination");  provided  that  the  terms  of each  Letter  of  Credit  that is
automatically  renewable annually shall (x) require the Issuing Bank that issued
such  Letter of Credit to give the  beneficiary  named in such  Letter of Credit
notice of any Notice of Termination,  (y) permit such beneficiary,  upon receipt
of such  notice,  to draw  under  such  Letter of Credit  prior to the date such
Letter of Credit  otherwise  would have been  automatically  renewed and (z) not
permit the  expiration  date (after giving effect to any renewal) of such Letter
of Credit in any event to be  extended  to a date later than 60 days  before the
Termination Date. If either a Notice of Renewal is not given by the Company or a
Notice of  Termination  is given by the relevant  Issuing  Bank  pursuant to the
immediately  preceding sentence,  such Letter of Credit shall expire on the date
on which it otherwise would have been automatically renewed; provided,  however,
that even in the absence of receipt of a Notice of Renewal the relevant  Issuing
Bank  may  in  its  discretion,   unless  instructed  to  the  contrary  by  the
Administrative  Agent or the  Company,  deem that a Notice of  Renewal  had been
timely  delivered  and in such case, a Notice of Renewal shall be deemed to have
been so delivered for all purposes under this  Agreement.  Each Letter of Credit
shall contain a provision  authorizing  the Issuing Bank that issued such Letter
of Credit to  deliver to the  beneficiary  of such  Letter of  Credit,  upon the
occurrence  and  during  the  continuance  of an Event of  Default,  a notice (a
"Default  Termination Notice") terminating such Letter of Credit and giving such
beneficiary 15 days to



<PAGE>   47


                                       41

draw such Letter of Credit.  Within the limits of the Letter of Credit Facility,
and  subject to the limits  referred  to above,  the  Company  may  request  the
issuance of Letters of Credit  under this Section  2.01(g),  repay any Letter of
Credit Advances resulting from drawings  thereunder  pursuant to Section 2.03(c)
and request the  issuance of  additional  Letters of Credit  under this  Section
2.01(g).

                  (h) Drawings.  Each Multicurrency  Lender severally agrees, on
the terms and conditions  hereinafter set forth, to accept Drafts (each Draft so
accepted, a "Bankers' Acceptance") for the account of the Canadian Borrower, and
to purchase  such  Bankers'  Acceptances  from time to time on any  Business Day
during the period from the date hereof until the Termination  Date having a Face
Amount  (determined in the Equivalent  thereof in Dollars) for all such Bankers'
Acceptances  purchased  by such Lender at the time of such Drawing not to exceed
such Lender's Unused  Multicurrency  Commitment at such time. Each Drawing shall
be comprised  solely of Canadian  Dollars,  shall be in an aggregate Face Amount
which,  together with any Canadian  Prime Rate Advances made in connection  with
such Drawing,  equals  CN$50,000 or an integral  multiple of CN$10,000 in excess
thereof and shall  consist of the creation and purchase of Bankers'  Acceptances
at or about the same time by the  Multicurrency  Lenders  ratably in  accordance
with  their  respective  Multicurrency  Commitments.  Within  the limits of each
Multicurrency  Lender's Unused  Multicurrency  Commitment in effect from time to
time,  amounts  drawn by the Canadian  Borrower  under this Section  2.01(h) and
repaid or  prepaid  from time to time may be redrawn  by the  Canadian  Borrower
under this Section 2.01(h).

                  (i) Set  Aside of  Multicurrency  Commitments  in  Respect  of
Overdraft Facilities.  Each Multicurrency Lender's ratable share of an aggregate
amount of Multicurrency  Commitments  equal to $5,000,000 (or such lesser amount
as may be  designated  by the  Company  to the  Administrative  Agent)  shall be
reserved against the Multicurrency  Facility to ensure that sufficient funds may
be made  available to any Foreign  Borrower for the  repayment of any  overdraft
facility  made  available  to such  Foreign  Borrower  by any Lender as the same
becomes due and payable.

                  SECTION  2.02.  Making the  Advances.  (a) Except as otherwise
provided in Section  2.02(b) or 2.03,  each  Borrowing  shall be made on notice,
given not later than (x) 12:00  Noon (New York City time) on the third  Business
Day prior to the date of the  proposed  Borrowing  (other  than a  Multicurrency
Borrowing) in the case of a Borrowing  consisting of Eurocurrency Rate Advances,
or the Business Day prior to the date of the proposed Borrowing in the case of a
Borrowing  consisting of Base Rate Advances,  (y) 4:00 P.M. (London time) on the
third Business Day prior to the date of the proposed  Borrowing in the case of a
Multicurrency  Borrowing  denominated in a currency other than Canadian  Dollars
consisting of Eurocurrency Rate Advances, or the first Business Day prior to the
date  of  the  proposed  Borrowing  in the  case  of a  Multicurrency  Borrowing
denominated in a currency other than Canadian  Dollars  consisting of Local Rate
Advances (or, in the case of Advances denominated in a Foreign Currency where



<PAGE>   48


                                       42

market  practice  differs,  in  accordance  with the  custom  for  such  Foreign
Currency),  or (z) 12:00 Noon (Toronto  time) on the first Business Day prior to
the date of the  proposed  Borrowing  in the case of a  Multicurrency  Borrowing
consisting  of Canadian  Prime Rate Advances by the  applicable  Borrower to the
Administrative   Agent   (and  in  the  case  of  a   Multicurrency   Borrowing,
simultaneously  to  the  applicable   Sub-Agent),   which  shall  give  to  each
Appropriate  Lender  prompt  notice  thereof by telex or  telecopier.  Each such
notice of a Borrowing (a "Notice of Borrowing") shall be by telephone, confirmed
immediately in writing,  or telex or telecopier,  in  substantially  the form of
Exhibit B-1 hereto, specifying therein the requested (i) date of such Borrowing,
(ii) Facility under which such  Borrowing is to be made,  (iii) Type of Advances
comprising such Borrowing,  (iv) aggregate amount of such Borrowing,  (v) in the
case of a Borrowing  consisting of Eurocurrency Rate Advances,  initial Interest
Period for each such Advance and (vi) in the case of a Multicurrency  Borrowing,
currency for each such Advance. Each Appropriate Lender shall, before 12:00 Noon
(New York City time) on the date of such  Borrowing,  in the case of a Borrowing
consisting  of Advances  denominated  in Dollars,  and before 12:00 Noon (London
time) on the date of such Borrowing,  in the case of a Multicurrency  Borrowing,
make  available  for  the  account  of  its  Applicable  Lending  Office  to the
Administrative Agent at the applicable  Administrative  Agent's Account, in same
day funds,  such Lender's  ratable  portion of such Borrowing in accordance with
the respective  Commitments under the applicable Facility of such Lender and the
other Appropriate Lenders, provided that the Multicurrency Lenders may otherwise
agree  to fund  such  Borrowing  disproportionately.  After  the  Administrative
Agent's receipt of such funds and upon fulfillment of the applicable  conditions
set forth in  Article  III,  the  Administrative  Agent  will  make  such  funds
available  to the  Company  by  crediting  the  applicable  Borrower's  Account;
provided,  however,  that, in the case of any Revolving  Credit  Borrowing,  the
Administrative  Agent  shall  first make a portion  of such  funds  equal to the
aggregate  principal  amount of any Swing  Line  Advances  and  Letter of Credit
Advances  made by the Swing Line Bank or any Issuing  Bank,  as the case may be,
and by any other  Revolving  Credit Lender and  outstanding  on the date of such
Revolving Credit  Borrowing,  plus interest accrued and unpaid thereon to and as
of such date, available to the Swing Line Bank or such Issuing Bank, as the case
may be, and such other Revolving Credit Lenders for repayment of such Swing Line
Advances and Letter of Credit Advances.

                  (b) Each Swing Line Borrowing  shall be made on notice,  given
not later than 12:00 Noon (New York City time) on the date of the proposed Swing
Line  Borrowing,  by the  Company to the Swing Line Bank and the  Administrative
Agent.  Each such  notice of a Swing  Line  Borrowing  (a  "Notice of Swing Line
Borrowing") shall be by telephone, confirmed immediately in writing, or telex or
telecopier,  specifying  therein the requested (i) date of such Borrowing,  (ii)
amount of such Borrowing and (iii) maturity of such  Borrowing  (which  maturity
shall be no later  than the  fifteenth  day  after  the  requested  date of such
Borrowing).  If, in its sole  discretion,  it elects to make the requested Swing
Line Advance,  the Swing Line Bank will make the amount thereof available to the
Administrative  Agent at the Administrative  Agent's Account, in same day funds.
After the Administrative Agent's receipt of such funds and upon fulfillment of



<PAGE>   49


                                       43

the  applicable  conditions set forth in Article III, the  Administrative  Agent
will make such funds  available  to the  Company  by  crediting  the  applicable
Borrower's  Account.  Upon written demand by the Swing Line Bank, with a copy of
such demand to the  Administrative  Agent,  each other  Revolving  Credit Lender
shall  purchase from the Swing Line Bank, and the Swing Line Bank shall sell and
assign to each such other Revolving Credit Lender,  such other Lender's Pro Rata
Share of such outstanding  Swing Line Advance as of the date of such demand,  by
making  available  for the  account  of its  Applicable  Lending  Office  to the
Administrative  Agent for the account of the Swing Line Bank,  by deposit to the
Administrative  Agent's  Account,  in same day  funds,  an  amount  equal to the
portion of the  outstanding  principal  amount of such Swing Line  Advance to be
purchased  by such  Lender.  The  Company  hereby  agrees  to each such sale and
assignment.  Each Revolving  Credit Lender agrees to purchase its Pro Rata Share
of an  outstanding  Swing Line  Advance on (i) the  Business Day on which demand
therefor is made by the Swing Line Bank,  provided that notice of such demand is
given not later than 12:00  Noon (New York City  time) on such  Business  Day or
(ii) the first Business Day next succeeding such demand if notice of such demand
is given after such time. Upon any such assignment by the Swing Line Bank to any
other  Revolving  Credit Lender of a portion of a Swing Line Advance,  the Swing
Line Bank  represents and warrants to such other Lender that the Swing Line Bank
is the legal and  beneficial  owner of such interest  being  assigned by it, but
makes no other  representation  or warranty and assumes no  responsibility  with
respect to such Swing Line Advance, the Loan Documents or any Loan Party. If and
to the extent that any Revolving Credit Lender shall not have so made the amount
of such Swing Line Advance available to the Administrative Agent, such Revolving
Credit Lender agrees to pay to the Administrative Agent forthwith on demand such
amount together with interest  thereon,  for each day from the date of demand by
the Swing  Line Bank  until the date such  amount is paid to the  Administrative
Agent, at the Federal Funds Rate. If such Lender shall pay to the Administrative
Agent such  amount for the account of the Swing Line Bank on any  Business  Day,
such  amount so paid in  respect  of  principal  shall  constitute  a Swing Line
Advance made by such Lender on such Business Day for purposes of this Agreement,
and the outstanding principal amount of the Swing Line Advance made by the Swing
Line Bank shall be reduced by such amount on such Business Day.

                  (c)  Anything  in   subsection   (a)  above  to  the  contrary
notwithstanding,  (i) no Borrower may select  Eurocurrency Rate Advances for the
initial Borrowing hereunder or for any Borrowing if the aggregate amount of such
Borrowing is less than $10,000,000,  in the case of Term A Borrowings and Term B
Borrowings, or $2,500,000 (or the Equivalent thereof in Dollars), in the case of
Revolving  Credit   Borrowings,   Multicurrency   Borrowings  and  Delayed  Draw
Borrowings, or if the obligation of the Appropriate Lenders to make Eurocurrency
Rate Advances shall then be suspended pursuant to Section  2.08(d)(ii),  2.10 or
2.12,  (ii) for the period  from the date  hereof to October  30,  1998 (or such
earlier date as shall be specified in its sole discretion by the  Administrative
Agent in a written  notice to the  Borrowers  and the  Lenders) no Borrower  may
select Eurocurrency Rate Advances having an Interest Period other than one month
and (iii) the Term A Advances may not be  outstanding  as part of more than five
separate



<PAGE>   50


                                       44

Borrowings consisting of Eurocurrency Rate Advances, the Term B Advances may not
be outstanding as more than six separate  Borrowings  consisting of Eurocurrency
Rate  Advances,  the Delayed Draw Advances may not be  outstanding  as more than
five  separate  Borrowings   consisting  of  Eurocurrency  Rate  Advances,   the
Multicurrency  Advances  may  not be  outstanding  as  more  than  six  separate
Borrowings  consisting of  Eurocurrency  Rate Advances and the Revolving  Credit
Advances may not be  outstanding  as part of more than ten  separate  Borrowings
consisting of Eurocurrency Rate Advances.

                  (d)  Each  Notice  of  Borrowing  and  Notice  of  Swing  Line
Borrowing  shall be irrevocable and binding on the applicable  Borrower.  In the
case of any Borrowing  that the related  Notice of Borrowing  specifies is to be
comprised of Eurocurrency Rate Advances, the applicable Borrower shall indemnify
each  Appropriate  Lender  against  any loss,  cost or expense  incurred by such
Lender as a result of any failure to fulfill on or before the date  specified in
such Notice of Borrowing for such Borrowing the applicable  conditions set forth
in Article III,  including,  without  limitation,  any loss  (including  loss of
anticipated  profits),  cost or expense incurred by reason of the liquidation or
reemployment  of  deposits  or other  funds  acquired by such Lender to fund the
Advance to be made by such Lender as part of such  Borrowing  when such Advance,
as a result of such failure, is not made on such date.

                  (e) Unless the Administrative Agent shall have received notice
from an Appropriate  Lender prior to the date of any Borrowing  under a Facility
under  which  such  Lender  has a  Commitment  that  such  Lender  will not make
available to the  Administrative  Agent such  Lender's  ratable  portion of such
Borrowing,  the  Administrative  Agent may assume that such Lender has made such
portion available to the  Administrative  Agent on the date of such Borrowing in
accordance with subsection (a) of this Section 2.02 and the Administrative Agent
may, in reliance upon such assumption, make available to the applicable Borrower
on such date a corresponding amount. If and to the extent that such Lender shall
not have so made such ratable  portion  available to the  Administrative  Agent,
such Lender and the applicable  Borrower  severally agree to repay or pay to the
Administrative  Agent forthwith on demand such  corresponding  amount and to pay
interest  thereon,  for each day from the date such amount is made  available to
such Borrower until the date such amount is repaid or paid to the Administrative
Agent, at (i) in the case of such Borrower,  the higher of (A) the interest rate
applicable at such time under Section 2.08 to Advances comprising such Borrowing
and (B) the cost of funds  incurred  by the  Administrative  Agent in respect of
such amount and (ii) in the case of such Lender,  (A) the Federal  Funds Rate in
the case of Advances denominated in Dollars or (B) the cost of funds incurred by
the  Administrative  Agent in  respect  of such  amount in the case of  Advances
denominated   in  Foreign   Currencies.   If  such  Lender   shall  pay  to  the
Administrative  Agent  such  corresponding  amount,  such  amount so paid  shall
constitute such Lender's Advance as part of such Borrowing for all purposes.




<PAGE>   51


                                       45

                  (f) The  failure of any Lender to make the  Advance to be made
by it as part of any  Borrowing  shall  not  relieve  any  other  Lender  of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be  responsible  for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.

                  SECTION 2.03. Issuance of and Drawings and Reimbursement Under
Letters of Credit.  (a) Request  for  Issuance.  Each Letter of Credit  shall be
issued upon notice,  given not later than Noon (New York City time) on the third
Business  Day  prior to the date of the  proposed  issuance  of such  Letter  of
Credit,   by  the  Company  to  any  Issuing  Bank,  which  shall  give  to  the
Administrative  Agent and each Revolving  Credit Lender prompt notice thereof by
telex or  telecopier.  Each  such  notice of  issuance  of a Letter of Credit (a
"Notice of Issuance") shall be by telephone,  confirmed  immediately in writing,
or  telex or  telecopier,  specifying  therein  the  requested  (A) date of such
issuance (which shall be a Business Day), (B) Available Amount of such Letter of
Credit,  (C) expiration  date of such Letter of Credit,  (D) name and address of
the  beneficiary of such Letter of Credit and (E) form of such Letter of Credit,
and shall be accompanied by such  application and agreement for letter of credit
as such Issuing Bank may specify to the Company for use in connection  with such
requested  Letter of Credit (a "Letter of Credit  Agreement").  If the requested
form of such Letter of Credit is  acceptable  to such  Issuing  Bank in its sole
discretion,   such  Issuing  Bank  will,  upon  fulfillment  of  the  applicable
conditions set forth in Article III, make such Letter of Credit available to the
Company at its office  referred to in Section 9.02 or as  otherwise  agreed with
the Company in  connection  with such  issuance.  In the event and to the extent
that the provisions of any Letter of Credit  Agreement  shall conflict with this
Agreement, the provisions of this Agreement shall govern.

                  (b) Letter of Credit Reports.  Each Issuing Bank shall furnish
(A) to the Administrative Agent on the first Business Day of each week a written
report summarizing  issuance and expiration dates of Letters of Credit issued by
such Issuing Bank during the previous  week and drawings  during such week under
all Letters of Credit issued by such Issuing Bank, (B) to each Revolving  Credit
Lender on the first  Business  Day of each  month a written  report  summarizing
issuance and  expiration  dates of Letters of Credit issued by such Issuing Bank
during the preceding  month and drawings  during such month under all Letters of
Credit issued by such Issuing Bank and (C) to the Administrative  Agent and each
Revolving  Credit Lender on the first  Business Day of each  calendar  quarter a
written report setting forth the average daily aggregate Available Amount during
the preceding  calendar  quarter of all Letters of Credit issued by such Issuing
Bank.

                  (c) Drawing and Reimbursement. The payment by any Issuing Bank
of a draft drawn under any Letter of Credit shall constitute for all purposes of
this  Agreement  the making by such Issuing Bank of a Letter of Credit  Advance,
which shall be a Base Rate  Advance,  in the amount of such draft.  Upon written
demand by any Issuing Bank with an outstanding Letter of



<PAGE>   52


                                       46

Credit Advance,  with a copy of such demand to the  Administrative  Agent,  each
Revolving  Credit Lender shall purchase from such Issuing Bank, and such Issuing
Bank shall sell and assign to each such Revolving  Credit Lender,  such Lender's
Pro Rata Share of such  outstanding  Letter of Credit  Advance as of the date of
such purchase,  by making  available for the account of its  Applicable  Lending
Office to the  Administrative  Agent for the account of such  Issuing  Bank,  by
deposit to the  Administrative  Agent's  Account,  in same day funds,  an amount
equal to the  portion  of the  outstanding  principal  amount of such  Letter of
Credit Advance to be purchased by such Lender.  Promptly after receipt  thereof,
the  Administrative  Agent shall  transfer such funds to such Issuing Bank.  The
Company hereby agrees to each such sale and  assignment.  Each Revolving  Credit
Lender agrees to purchase its Pro Rata Share of an outstanding  Letter of Credit
Advance on (i) the Business Day on which demand  therefor is made by the Issuing
Bank which made such  Advance,  provided that notice of such demand is given not
later than 11:00 A.M.  (New York City time) on such  Business  Day,  or (ii) the
first Business Day next succeeding such demand if notice of such demand is given
after such time.  Upon any such  assignment  by an Issuing Bank to any Revolving
Credit  Lender of a portion of a Letter of Credit  Advance,  such  Issuing  Bank
represents and warrants to such other Lender that such Issuing Bank is the legal
and  beneficial  owner of such interest  being assigned by it, free and clear of
any  liens,  but  makes no other  representation  or  warranty  and  assumes  no
responsibility with respect to such Letter of Credit Advance, the Loan Documents
or any Loan Party.  If and to the extent that any Revolving  Credit Lender shall
not have so made the amount of such Letter of Credit  Advance  available  to the
Administrative  Agent,  such  Revolving  Credit  Lender  agrees  to  pay  to the
Administrative  Agent  forthwith on demand such amount  together  with  interest
thereon,  for each day from the date of demand by such  Issuing  Bank  until the
date such amount is paid to the Administrative  Agent, at the Federal Funds Rate
for its account or the account of such  Issuing  Bank,  as  applicable.  If such
Lender shall pay to the Administrative Agent such amount for the account of such
Issuing  Bank on any Business  Day,  such amount so paid in respect of principal
shall constitute a Letter of Credit Advance made by such Lender on such Business
Day for purposes of this Agreement,  and the outstanding principal amount of the
Letter of Credit  Advance  made by such  Issuing  Bank  shall be reduced by such
amount on such Business Day.

                  (d) Failure to Make Letter of Credit Advances.  The failure of
any  Lender to make the  Letter of Credit  Advance  to be made by it on the date
specified  in  Section  2.03(c)  shall  not  relieve  any  other  Lender  of its
obligation  hereunder to make its Letter of Credit  Advance on such date, but no
Lender  shall be  responsible  for the  failure of any other  Lender to make the
Letter of Credit Advance to be made by such other Lender on such date.

                  SECTION 2.04.  Drawings of Bankers'  Acceptances.  (a) Request
for Drawing.  Each Drawing  shall be made on notice,  given not later than 11:00
A.M.  (Toronto  time) on a Business Day at least two Business  Days prior to the
date of the proposed  Drawing,  by the Canadian  Borrower to the  Administrative
Agent, which shall give each Multicurrency Lender prompt notice thereof by telex
or telecopier. Each notice of a Drawing (a "Notice of Drawing")



<PAGE>   53


                                       47

shall be in writing  (including by telex or telecopier),  in  substantially  the
form of Exhibit B-2 hereto,  and shall be confirmed by telephone  immediately by
the Canadian Borrower, specifying therein the requested (i) date of such Drawing
(which shall be a Business Day),  (ii) aggregate Face Amount of such Drawing and
(iii) initial Maturity Date for each Bankers' Acceptance comprising part of such
Drawing; provided, however, that, if the Administrative Agent determines in good
faith (which  determination  shall be  conclusive  and binding upon the Canadian
Borrower)  that the Drafts to be accepted  and  purchased as part of any Drawing
cannot, due solely to the requested  aggregate Face Amount thereof,  be accepted
and/or purchased ratably by the Multicurrency Lenders in accordance with Section
2.01(h),  (provided that the  Multicurrency  Lenders may otherwise agree to fund
such Drawing disproportionately), then the aggregate Face Amount of such Drawing
(or the Face Amount of Bankers'  Acceptances to be created by any  Multicurrency
Lender)  shall be  reduced to such  lesser  amount as the  Administrative  Agent
determines  will  permit such Drafts  comprising  part of such  Drawing to be so
accepted  and  purchased  and,  unless the  Canadian  Borrower  shall have given
written notice to the contrary to the  Administrative  Agent, each Multicurrency
Lender shall fund the difference  between such Lender's  ratable  portion of the
original  aggregate  Face  Amount  of such  Drawing  and the Face  Amount of the
Bankers'  Acceptances  to be created by such Lender after giving  effect to such
reduction in the form of a Canadian  Prime Rate  Advance,  which shall be deemed
for all purposes hereof to be a  Multicurrency  Advance made pursuant to Section
2.01(h).   The  Administrative  Agent  agrees  that  it  will,  as  promptly  as
practicable,  notify the  Canadian  Borrower of the  unavailability  of Bankers'
Acceptances  and,  if  applicable,  of the date and the amount of each  Canadian
Prime  Rate  Advance  to be  made  or  actually  made  in  accordance  with  the
immediately  preceding  sentence.  Each Draft in  connection  with any requested
Drawing (A) shall be in a minimum  amount of CN$100,000 or an integral  multiple
of CN$100,000 in excess thereof, and (B) shall be dated the date of the proposed
Drawing. Each Multicurrency Lender shall, before 1:00 p.m. (Toronto time) on the
date of each Drawing, complete one or more Drafts in accordance with the related
Notice of Drawing,  accept such Drafts and  purchase  the  Bankers'  Acceptances
created  thereby  for the  Drawing  Purchase  Price and shall,  before 1:00 p.m.
(Toronto  time) on such date,  make  available for the account of its Applicable
Lending Office to the  Administrative  Agent at its  appropriate  Administrative
Agent's  Account,  in same day funds, the Drawing Purchase Price payable by such
Lender for such Drawing less the Drawing Fee payable to such Lender with respect
thereto under Section 2.09(d). Upon the fulfillment of the applicable conditions
set forth in Article  III, the  Administrative  Agent will make the funds it has
received from the  Multicurrency  Lenders  available to the Canadian Borrower by
crediting the relevant  Borrower's  Account or at the applicable Payment Office,
as the case may be.

                  (b)  Limitations on Drawings.  Anything in Section  2.04(a) to
the contrary notwithstanding,  the Canadian Borrower may not select a Drawing if
the  obligation  of the  Multicurrency  Lenders to purchase and accept  Bankers'
Acceptances shall then be suspended pursuant to Section 2.04(d) or 2.12.




<PAGE>   54


                                       48

                  (c)  Binding  Effect of Notices  of  Drawing.  Each  Notice of
Drawing shall be irrevocable and binding on the Canadian  Borrower.  In the case
of  any  proposed   Drawing,   the  Canadian   Borrower  shall   indemnify  each
Multicurrency  Lender against any loss, cost or expense  incurred by such Lender
as a result of any  failure to fulfill  on or before the date  specified  in the
Notice of  Drawing  for such  Drawing  the  applicable  conditions  set forth in
Article  III,  including,  without  limitation,  any  loss  (including  loss  of
anticipated  profits),  cost or expense incurred by reason of the liquidation or
reemployment  of  deposits  or other  funds  acquired by such Lender to fund the
Drawing  Purchase  Price to be paid by such Lender as part of such Drawing when,
as a result of such failure, such Drawing is not made on such date.

                  (d) Circumstances Making Bankers' Acceptances Unavailable. (i)
If, with respect to any proposed Drawing, the Administrative Agent determines in
good  faith  that  circumstances  affecting  the money  markets  at the time any
related  Notice of Drawing is  delivered  or is  outstanding  will  result in no
market  for the  Bankers'  Acceptances  to be created  in  connection  with such
Drawing or an  insufficient  demand for such Bankers'  Acceptances  to allow the
Lenders  creating  such  Bankers'  Acceptances  to sell or  trade  the  Bankers'
Acceptances  to be created and  purchased  or  discounted  by them  hereunder in
connection with such Drawing, then, upon notice to the Canadian Borrower and the
Multicurrency  Lenders  thereof,  (A) the Notice of Drawing with respect to such
proposed Drawing shall be canceled and the Drawing  requested  therein shall not
be made and (B) the right of the Canadian Borrower to request a Drawing shall be
suspended  until the  Administrative  Agent shall notify such  Borrower that the
circumstances  causing such  suspension no longer exist. In the case of any such
cancellation  of a Notice of Drawing,  unless the Canadian  Borrower  shall give
written notice to the contrary to the Administrative  Agent, the cancellation of
any such  Notice of  Drawing  shall be deemed to be the  giving by the  Canadian
Borrower of a Notice of  Borrowing  for  Multicurrency  Advances  consisting  of
Canadian  Prime Rate  Advances in an  aggregate  principal  amount  equal to the
aggregate  Face Amount of such proposed  Drawing and the  Multicurrency  Lenders
shall,  subject to the terms and conditions  hereof  applicable to the making of
Multicurrency  Advances,  make such Advances available to the Canadian Borrower,
if  practicable,  on the same  Business  Day, and otherwise on the next Business
Day. The  Administrative  Agent agrees that it will, as promptly as practicable,
notify the Canadian Borrower of the unavailability of Bankers'  Acceptances and,
if applicable, of the date and the amount of each Canadian Prime Rate Advance to
be made or actually made in accordance with the immediately preceding sentence.

                  (ii) Upon the  occurrence  and during the  continuance  of any
Default,  the obligation of the Multicurrency  Lenders to purchase and/or accept
Bankers' Acceptances shall be suspended.

                  (e)  Assumptions  of  the  Administrative  Agent.  Unless  the
Administrative  Agent shall have  received  notice from a  Multicurrency  Lender
prior to the date of any Drawing that such Lender will not make  available to it
such Lender's ratable share of the Drawing Purchase



<PAGE>   55


                                       49

Price of such Drawing in accordance  with Section  2.04(a),  the  Administrative
Agent may assume that such Lender has made such ratable share available to it on
the  date  of  such  Drawing  in  accordance   with  Section   2.04(a)  and  the
Administrative  Agent may, in reliance upon such  assumption,  make available to
the Canadian Borrower on such date a corresponding  amount. If and to the extent
that any such Lender shall not have so made such ratable share  available to the
Administrative  Agent, such Lender and the Canadian Borrower  severally agree to
repay or pay to the Administrative  Agent forthwith on demand such corresponding
amount,  together with interest thereon,  for each day from the date such amount
is made  available to such Borrower until the date such amount is repaid or paid
to the Administrative Agent, at (i) in the case of the Canadian Borrower, a rate
per annum equal to the BA Rate used in  calculating  the Drawing  Purchase Price
with respect to such Drawing,  and (ii) in the case of such Lender,  the cost of
funds incurred by the  Administrative  Agent in respect of such amount.  If such
Lender shall pay to the  Administrative  Agent such corresponding  amount,  such
amount so paid shall  constitute  such Lender's  Bankers'  Acceptance as part of
such Drawing for all purposes under this Agreement.

                  (f) Presigned Draft Forms. To enable the Multicurrency Lenders
to create  Bankers'  Acceptances  in  accordance  with Section  2.01(h) and this
Section 2.04, the Canadian Borrower shall supply each Multicurrency Lender, upon
the Canadian Borrower's execution of this Agreement,  with such number of Drafts
provided  to  the  Canadian  Borrower  by  the   Administrative   Agent  as  the
Administrative Agent may from time to time reasonably request, duly endorsed and
executed  on  behalf  of the  Canadian  Borrower  by any one or more of its duly
authorized  officers.  Each Multicurrency Lender shall exercise such care in the
custody and  safekeeping of any Drafts in its possession from time to time as it
would exercise in the custody and  safekeeping of similar  property owned by it.
The  signatures  of  officers  of  the  Canadian   Borrower  on  Drafts  may  be
mechanically  reproduced  in  facsimile  and Bankers'  Acceptances  bearing such
facsimile  signatures shall be binding upon the Canadian Borrower as if they had
been  manually  signed  by  such  officers.  Notwithstanding  that  any  of  the
individuals  whose manual or facsimile  signature appears on any Draft as one of
such officers may no longer hold office at the date of such draft or at the date
of its acceptance by a Lender hereunder or at any time thereafter,  any Draft or
Bankers'  Acceptance so signed shall be valid and binding upon, and  enforceable
against, the Canadian Borrower.

                  (g) Distribution of Bankers' Acceptances. Bankers' Acceptances
purchased  by a  Multicurrency  Lender in  accordance  with the terms of Section
2.01(h) and this Section 2.04 may, in such Lender's sole discretion,  be held by
such  Lender for its own account  until the  applicable  Maturity  Date or sold,
rediscounted  or  otherwise  disposed of by it at any time prior  thereto in any
relevant market therefor.

                  (h) Failure to Fund in Respect of Drawings. The failure of any
Multicurrency  Lender to fund the Drawing  Purchase  Price to be funded by it as
part of any  Drawing  shall not relieve  any other  Multicurrency  Lender of its
obligation hereunder to fund its Drawing Purchase



<PAGE>   56


                                       50

Price  on the  date  of such  Drawing,  but no  Multicurrency  Lender  shall  be
responsible  for the  failure  of any  other  Multicurrency  Lender  to fund the
Drawing  Purchase Price to be funded by such other  Multicurrency  Lender on the
date of any Drawing.

                  SECTION 2.05. Repayment of Advances.  (a) Term A Advances. The
Company shall repay to the  Administrative  Agent for the ratable account of the
Term A Lenders the aggregate outstanding principal amount of the Term A Advances
on the following dates in the amounts  indicated (which amounts shall be reduced
as a result of the  application of  prepayments in accordance  with the order of
priority set forth in Section 2.07):


              Date                             Amount
              ----                             ------
         September 30, 1998                $  1,500,000
         December 31, 1998                    1,500,000

         March 31, 1999                       1,500,000
         June 30, 1999                        1,500,000
         September 30, 1999                   2,000,000
         December 31, 1999                    2,000,000

         March 31, 2000                       2,000,000
         June 30, 2000                        2,000,000
         September 30, 2000                   2,000,000
         December 31, 2000                    2,000,000

         March 31, 2001                       2,000,000
         June 30, 2001                        2,000,000
         September 30, 2001                   2,000,000
         December 31, 2001                    2,000,000

         March 31, 2002                       2,000,000
         June 30, 2002                        2,000,000
         September 30, 2002                   2,500,000
         December 31, 2002                    2,500,000

         March 31, 2003                       2,500,000
         June 30, 2003                        2,500,000
         September 30, 2003                   2,500,000
         December 31, 2003                    2,500,000

         March 31, 2004                       2,500,000
         June 30, 2004                        2,500,000




<PAGE>   57


                                       51

provided,  however, that the final principal installment shall be repaid on June
30, 2004 and in any event shall be in an amount equal to the aggregate principal
amount of the Term A Advances outstanding on such date.

                  (b)  Term  B  Advances.   The  Company   shall  repay  to  the
Administrative Agent for the ratable account of the Term B Lenders the aggregate
outstanding  principal  amount of the Term B Advances on the following  dates in
amounts  determined as a percentage  of the aggregate  amount of Term B Advances
outstanding  on September  30, 1998 as indicated  below (which  amounts shall be
reduced as a result of the  application of  prepayments  in accordance  with the
order of priority set forth in Section 2.07):

                      Date                               Percentage
                      ----                               ----------

                 July 31, 1999                                1%
                 July 31, 2000                                1%
                 July 31, 2001                                1%
                 July 31, 2002                                1%
                 July 31, 2003                                1%
                 July 31, 2004                                1%
                 July 31, 2005                               20%
                 July 30, 2006                               74%

provided,  however, that the final principal installment shall be repaid on July
30, 2006 and in any event shall be in an amount equal to the aggregate principal
amount of the Term B Advances outstanding on such date.

                  (c) Delayed  Draw  Advances.  The  Company  shall repay to the
Administrative  Agent for the ratable account of the Delayed Draw Lenders (i) on
each March 31, June 30, September 30 and December 31,  commencing  September 30,
2000, an amount equal to 1/16 of the aggregate  outstanding  principal amount of
the Delayed Draw  Advances  outstanding  on the  Conversion  Date (after  giving
effect to any  prepayments  required  by  Section  2.07(b)(i)  or (ii) and which
amount shall be reduced as a result of the application of further prepayments in
accordance  with the order of priority set forth in the applicable  paragraph of
section  2.07)  and  (ii) on June 30,  2004 an  amount  equal  to the  aggregate
principal amount of the Delayed Draw Advances outstanding on such date.

                  (d) Multicurrency  Advances. Each Foreign Borrower shall repay
to the Administrative Agent for the ratable account of the Multicurrency Lenders
on the  Termination  Date the  aggregate  outstanding  principal  amount  of the
Multicurrency Advances then outstanding.




<PAGE>   58


                                       52

                  (e) Bankers' Acceptances. The Canadian Borrower shall, subject
to Sections 2.11(a) and 2.11(b), pay to the Administrative Agent for the ratable
account  of the  Multicurrency  Lenders  on the  Maturity  Date of any  Bankers'
Acceptances  an amount equal to the  aggregate  Face Amount of all such Bankers'
Acceptances  maturing on such date. Any payment by the Canadian  Borrower of any
Bankers'  Acceptances  in accordance  with this Section  2.05(e)  shall,  to the
extent of such payment,  satisfy the obligations of the Canadian  Borrower under
the  Bankers'  Acceptances  to which it relates  and,  in the case of a Bankers'
Acceptance,  the Lender that has accepted such Bankers' Acceptance shall, to the
extent of such payment to such Lender,  thereafter be solely responsible for the
payment thereof.

                  (f) Revolving Credit Advances.  The Company shall repay to the
Administrative  Agent for the ratable account of the Revolving Credit Lenders on
the Termination Date the aggregate outstanding principal amount of the Revolving
Credit Advances then outstanding.

                  (g)  Swing  Line  Advances.  The  Company  shall  repay to the
Administrative  Agent  for the  account  of the Swing  Line Bank and each  other
Revolving  Credit  Lender  that has made a Swing Line  Advance  the  outstanding
principal  amount of each Swing Line Advance made by each of them on the earlier
of the maturity date specified in the applicable  Notice of Swing Line Borrowing
(which  maturity  shall be no later than the  fifteenth  day after the requested
date of such Borrowing) and the Termination Date.

                  (h) Letter of Credit Advances.  (i) The Company shall repay to
the  Administrative  Agent for the account of each  Issuing  Bank and each other
Revolving  Credit Lender that has made a Letter of Credit Advance on the earlier
of the second Business Day after the date on which such Advance was made and the
Termination  Date the  outstanding  principal  amount  of each  Letter of Credit
Advance made by each of them.

                  (ii) The Obligations of the Company under this Agreement,  any
Letter of Credit Agreement and any other agreement or instrument relating to any
Letter of  Credit  shall be  unconditional  and  irrevocable,  and shall be paid
strictly in accordance with the terms of this  Agreement,  such Letter of Credit
Agreement  and such  other  agreement  or  instrument  under all  circumstances,
including, without limitation, the following circumstances:

                  (A)  any  lack  of  validity  or  enforceability  of any  Loan
         Document,  any Letter of Credit Agreement,  any Letter of Credit or any
         other  agreement or instrument  relating  thereto (all of the foregoing
         being, collectively, the "L/C Related Documents");

                  (B) any change in the time,  manner or place of payment of, or
         in any other term of, all or any of the  Obligations  of the Company in
         respect of any L/C Related Document



<PAGE>   59


                                       53

         or any other  amendment or waiver of or any consent to  departure  from
         all or any of the L/C Related Documents;

                  (C) the  existence  of any  claim,  set-off,  defense or other
         right that the Company may have at any time against any  beneficiary or
         any transferee of a Letter of Credit (or any Persons for which any such
         beneficiary or any such transferee may be acting),  any Issuing Bank or
         any  other  Person,   whether  in  connection  with  the   transactions
         contemplated by the L/C Related Documents or any unrelated transaction;

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

                  (E)  payment  by any  Issuing  Bank  under a Letter  of Credit
         against  presentation of a draft or certificate  that does not strictly
         comply with the terms of such Letter of Credit;

                  (F) any exchange,  release or non-perfection of any Collateral
         or other  collateral,  or any  release  or  amendment  or  waiver of or
         consent to departure  from the Guaranties or any other  guarantee,  for
         all or any of the  Obligations  of the  Company  in  respect of the L/C
         Related Documents; or

                  (G) any other circumstance or happening whatsoever, whether or
         not similar to any of the foregoing, including, without limitation, any
         other circumstance that might otherwise  constitute a defense available
         to, or a discharge of, the Company or a guarantor.

                  SECTION 2.06. Termination or Reduction of the Commitments. (a)
Optional.  The Company  may,  upon at least five  Business  Days'  notice to the
Administrative  Agent,  terminate in whole or reduce in part the unused portions
of the  Delayed  Draw  Commitments,  the Letter of Credit  Facility,  the Unused
Revolving Credit Commitments and the Unused Multicurrency Commitments; provided,
however,  that each partial reduction of a Facility (i) shall be in an aggregate
amount of $1,000,000 or an integral multiple of $1,000,000 in excess thereof and
(ii) shall be made ratably  among the  Appropriate  Lenders in  accordance  with
their Commitments with respect to such Facility.

                  (b) Mandatory. (i) On the date of the Term A Borrowing,  after
giving  effect to the Term A Borrowing,  and from time to time  thereafter  upon
each  repayment  or  prepayment  of the Term A Advances,  the  aggregate  Term A
Commitments  of the  Term A  Lenders  shall  be  automatically  and  permanently
reduced,  on a pro rata  basis,  by an amount  equal to the  amount by which the
aggregate  Term A Commitments  immediately  prior to such  reduction  exceed the
aggregate unpaid principal amount of the Term A Advances then outstanding.



<PAGE>   60


                                       54

                  (ii) On the date of the Term B Borrowing,  after giving effect
to the Term B Borrowing, and from time to time thereafter upon each repayment or
prepayment of the Term B Advances,  the aggregate Term B Commitments of the Term
B Lenders shall be automatically and permanently  reduced,  on a pro rata basis,
by an  amount  equal to the  amount by which the  aggregate  Term B  Commitments
immediately prior to such reduction exceed the aggregate unpaid principal amount
of the Term B Advances then outstanding.

                  (iii) The Delayed Draw  Facility  shall be  automatically  and
permanently  reduced,  on a pro rata basis, (A) on the date of each Delayed Draw
Borrowing, by an amount equal to the amount of such Borrowing, from time to time
on and  after the  Conversion  Date upon each  repayment  or  prepayment  of the
Delayed Draw  Advances,  by an amount equal to the amount by which the aggregate
Delayed Draw Commitments of the Delayed Draw Lenders  immediately  prior to such
reduction  exceed the  aggregate  unpaid  principal  amount of the Delayed  Draw
Advances then  outstanding  and (B) on the date on which  prepayment  thereof is
required to be made  pursuant to Section  2.07(b)(i),(ii)  or (iii) prior to the
Conversion  Date in an amount equal to the  applicable  Delayed  Draw  Reduction
Amount.

                  (iv) The  Letter  of  Credit  Facility  shall  be  permanently
reduced from time to time on the date of each reduction in the Revolving  Credit
Facility  by the  amount,  if any,  by which the  amount of the Letter of Credit
Facility  exceeds the  Revolving  Credit  Facility  after giving  effect to such
reduction of the Revolving Credit Facility.

                  (v) The Swing Line Facility shall be permanently  reduced from
time to time on the date of each reduction in the Revolving  Credit  Facility by
the amount,  if any, by which the amount of the Swing Line Facility  exceeds the
Revolving Credit Facility after giving effect to such reduction of the Revolving
Credit Facility.

                  (vi) The Revolving Credit Facility shall be automatically  and
permanently  reduced,  on a pro rata basis, (A) on each date on which prepayment
thereof is required to be made pursuant to Section 2.07(b)(i),  (ii) or (iii) in
an  amount  equal  to the  applicable  Reduction  Amount  and (B) on the date of
receipt by the Company or any of its  Subsidiaries  of the Net Cash  Proceeds of
any sale,  lease,  transfer or other  disposition of any asset of the Company or
any of its  Subsidiaries in each case by an amount equal to the amount,  if any,
of such Net Cash Proceeds that  concurrently  with the receipt thereof (x) shall
not have been  deposited by the Company into the Cash  Collateral  Account,  (y)
shall  not have  been  applied  to  prepay  Advances  or (z) shall not have been
applied in accordance with Section 8(c) of the Security Agreement, provided that
each such reduction of the Revolving Credit Facility shall be made ratably among
the  Revolving   Credit  Lenders  in  accordance  with  their  Revolving  Credit
Commitments.

                  (vii) The  Multicurrency  Facility shall be automatically  and
permanently  reduced,  on a pro rata basis, (A) on each date on which prepayment
thereof is required to be made



<PAGE>   61


                                       55

pursuant  to  Section  2.07(b)(i),  (ii) or  (iii)  in an  amount  equal  to the
applicable  Multicurrency Reduction Amount, provided that each such reduction of
the Multicurrency Facility shall be made ratably among the Multicurrency Lenders
in accordance with their Multicurrency Commitments.

                  SECTION 2.07.  Prepayments.  (a) Optional.  Each Borrower may,
upon  notice not later  than 11:00 A.M.  (New York City time) on the day of such
prepayment  in the case of Base Rate  Advances  and at least two  Business  Days
prior to such prepayment in the case of Eurocurrency Rate Advances, in each case
to the  Administrative  Agent stating the proposed date and aggregate  principal
amount of the  prepayment,  and if such  notice is given  such  Borrower  shall,
prepay the outstanding  aggregate  principal  amount of the Advances  comprising
part of the same  Borrowing in whole or ratably in part,  together  with accrued
interest  to the  date of such  prepayment  on the  aggregate  principal  amount
prepaid;  provided,  however,  that (x) each partial  prepayment  shall be in an
aggregate  principal amount of $5,000,000 or an integral  multiple of $1,000,000
in excess thereof (or the Equivalent  thereof in a Foreign  Currency) and (y) if
any prepayment of a  Eurocurrency  Rate Advance is made on a date other than the
last day of an Interest  Period for such Advance,  such Borrower  shall also pay
any amounts owing pursuant to Section  9.04(c).  Each such  prepayment of Term A
Advances,  Term B Advances and, after the Conversion Date, Delayed Draw Advances
shall be  applied to the  installments  thereof  in the order  specified  by the
Company.

                  (b)  Mandatory.  (i)  The  Company  shall,  on  the  90th  day
following the end of each Fiscal Year,  prepay an aggregate  principal amount of
the Advances comprising part of the same Borrowings in an amount equal to (A) to
the extent that the Total Leverage Ratio exceeds  4.00:1.00,  75% and (B) to the
extent that the Total  Leverage Ratio is less than 4.00:1.00 but is greater than
3.00:1.00, 50% of the amount, in the case of any payments made in any year after
1999,  of Excess  Cash Flow for such Fiscal Year and, in the case of any payment
made in 1999, of Excess Cash Flow for the period from April 13, 1998 through the
end of the Fiscal Year ending December 31, 1998.  Each such prepayment  shall be
applied as set forth in clause (vii) below.

                  (ii) (A) The Company shall, on the date that is 270 days after
the  date of  receipt  of the Net Cash  Proceeds  by the  Company  or any of its
Subsidiaries from the sale,  lease,  transfer or other disposition of any assets
of the  Company  or any of its  Subsidiaries  (other  than (x) any sale,  lease,
transfer  or other  disposition  of assets  pursuant  to any  clause of  Section
5.02(e) other than clause (iii)  thereof or (y) an aggregate  amount of Net Cash
Proceeds  less than  $2,500,000  in any Fiscal Year of the  Company),  prepay an
aggregate  principal  amount  of  the  Advances  comprising  part  of  the  same
Borrowings in an amount equal to that portion of such Net Cash Proceeds that has
not been reinvested in the business of the Company and its Subsidiaries prior to
such 270th  day.  Each such  prepayment  shall be applied as set forth in clause
(vii) below.

                  (B) The Company shall,  on the date of receipt of the Net Cash
Proceeds  by the  Company  or any of its  Subsidiaries  from  the  sale,  lease,
transfer or other disposition of any assets



<PAGE>   62


                                       56

of the Company or any of its  Subsidiaries  pursuant  to Section  5.02(e)(viii),
prepay an aggregate  principal  amount of Advances  comprising  part of the same
Borrowings in an amount equal to such Net Cash  Proceeds.  Each such  prepayment
shall be applied as set forth in clause (vii) below.

                  (C) The Company shall,  on the date of receipt of the Net Cash
Proceeds by the Company or any of its Subsidiaries (x) from the sale or issuance
of  Subordinated  Debt or (y) the receipt of any capital  contribution  from WHX
Corporation  or any of its  Subsidiaries  or from  the sale or  issuance  of any
equity  securities  permitted  by  Section  5.02(g)(iii),  prepay  an  aggregate
principal amount of Advances comprising part of the same Borrowings in an amount
equal to such Net Cash Proceeds.  Each such  prepayment  shall be applied as set
forth in clause (vii) below.

                  (iii) The  Company  shall,  on the date of  receipt of the Net
Cash Proceeds by the Company or any of its  Subsidiaries  from the incurrence or
issuance by the Company or any of its  Subsidiaries of any Debt (other than Debt
incurred or issued pursuant to Section 5.02(b)),  prepay an aggregate  principal
amount of the Advances comprising part of the same Borrowings in an amount equal
to the amount of such Net Cash Proceeds.  Each such prepayment  shall be applied
as set forth in clause (vii) below.

                  (iv) The  Company  shall,  on each  Business  Day,  prepay  an
aggregate  principal amount of the Revolving Credit Advances  comprising part of
the same  Borrowings,  the Letter of Credit Advances and the Swing Line Advances
in an amount equal to the amount by which (A) the sum of the aggregate principal
amount of (x) the Revolving Credit  Advances,  (y) the Letter of Credit Advances
and (z) the Swing Line Advances then  outstanding  plus the aggregate  Available
Amount of all Letters of Credit then  outstanding  exceeds (B) the lesser of the
Revolving  Credit  Facility  and the excess of (1) the sum of the Loan Values of
the Eligible  Collateral  over (2) the amount referred to in clause (v)(A) below
on such Business Day.

                  (v) The Foreign  Borrowers shall, on each Business Day, prepay
an aggregate  principal amount of the Multicurrency  Advances comprising part of
the  same  Borrowings  equal  to the  amount  by  which  (A)  the sum of (x) the
aggregate  principal amount of the Multicurrency  Advances and (y) the aggregate
Face Amount of Bankers'  Acceptances then outstanding  exceeds (B) the lesser of
the  Multicurrency  Facility and the excess of (1) the sum of the Loan Values of
the Eligible  Collateral over (2) the amount referred to in clause (iv)(A) above
on such Business Day.

                  (vi) The  Company  shall,  on each  Business  Day,  pay to the
Administrative  Agent for deposit in the L/C Cash  Collateral  Account an amount
sufficient to cause the aggregate  amount on deposit in such L/C Cash Collateral
Account  to equal  the  amount by which the  aggregate  Available  Amount of all
Letters of Credit then outstanding exceeds the Letter of Credit Facility on such
Business Day.


<PAGE>   63


                                       57

                  (vii) (A) Prepayments  made pursuant to clauses (i),  (ii)(A),
(ii)(B) and (iii) above shall be applied as follows:

                  first,  ratably  to the Term A  Facility,  the Term B Facility
         and, on and after the Conversion  Date,  the Delayed Draw Facility,  in
         each case ratably to the principal installments thereof, and

                  second, to the extent that no Term A Advances, Term B Advances
         or,  after  the   Conversion   Date,   Delayed  Draw  Advances   remain
         outstanding,  permanently to reduce the Revolving  Credit Facility and,
         prior to the Conversion Date, the Delayed Draw Facility as set forth in
         clause (viii) or (ix) below, as applicable.

                  (B)      Prepayments  made  pursuant to clause  (ii)(C)  above
shall be applied as follows:

                  first, 75% ratably to the Term A Facility, the Term B Facility
         and, on and after the Conversion  Date,  the Delayed Draw Facility,  in
         each case ratably to the principal  installments  thereof,  and 25%, at
         the Company's election,  (1) ratably to the Term A Facility, the Term B
         Facility  and,  on and after the  Conversion  Date,  the  Delayed  Draw
         Facility, in each case ratably to the principal installments thereof or
         (2) to prepay  the  Revolving  Credit  Facility  as set forth in clause
         (viii) below (without giving effect to clause (y) thereof), and

                  second, to the extent that no Term A Advances, Term B Advances
         or,  after  the   Conversion   Date,   Delayed  Draw  Advances   remain
         outstanding,  75%  permanently to ratably  reduce the Revolving  Credit
         Facility and the  Multicurrency  Facility and,  prior to the Conversion
         Date, the Delayed Draw Facility as set forth in clause (viii),  (ix) or
         (xi) below,  as  applicable,  and 25%, to prepay the  Revolving  Credit
         Facility as set forth in clause (viii) below (without  giving effect to
         clause (y) thereof) .

                  (viii)  Prepayments  of the  Revolving  Credit  Facility  made
pursuant to clause  (i),  (ii),  (iii) or (iv) above  shall be first  applied to
prepay Letter of Credit Advances then  outstanding  until such Advances are paid
in full,  second  applied to prepay Swing Line Advances then  outstanding  until
such  Advances  are paid in full and third  applied to prepay  Revolving  Credit
Advances then  outstanding  comprising  part of the same  Borrowings  until such
Advances  are paid in full;  and, in the case of  prepayments  of the  Revolving
Credit Facility  required  pursuant to clause (i), (ii) or (iii) above,  (x) the
amount  remaining (if any) after the prepayment in full of the Revolving  Credit
Advances  then  outstanding  (the sum of such  prepayment  amounts and remaining
amount being  referred to herein as the  "Reduction  Amount") may be retained by
the Company and (y) the Revolving  Credit Facility shall be permanently  reduced
as set forth in Section 2.06(b)(vi).



<PAGE>   64


                                       58

                  (ix)  Prepayments  of the  Delayed  Draw  Facility  before the
Conversion  Date made  pursuant  to clause  (i),  (ii) or (iii)  above  shall be
applied to prepay Delayed Draw Advances then outstanding  comprising part of the
same Borrowings  until such Advances are paid in full; and the amount  remaining
(if  any)  after  the  prepayment  in full of the  Delayed  Draw  Advances  then
outstanding  (the sum of such  prepayment  amounts and  remaining  amount  being
referred to herein as the "Delayed  Draw  Reduction  Amount") may be retained by
the Company and the Delayed Draw Facility  shall be  permanently  reduced as set
forth in Section 2.06(b)(iii).

                  (x) If the Administrative Agent notifies the Foreign Borrowers
that, on any interest payment date, the Equivalent in Dollars (determined on the
third  Business  Day  prior to such  interest  payment  date)  of the  aggregate
principal amount of all Multicurrency  Advances then outstanding exceeds 103% of
the aggregate  Multicurrency  Commitments of the  Multicurrency  Lenders on such
date,  the Foreign  Borrowers  shall,  within two Business Days after receipt of
such  notice,  prepay  the  outstanding  principal  amount of any  Multicurrency
Advances  owing by the Foreign  Borrowers in an aggregate  amount  sufficient to
reduce such sum to an amount not to exceed 100% of the  aggregate  Multicurrency
Commitments of the Multicurrency Lenders on such date.

                  (xi) Prepayments of the  Multicurrency  Facility made pursuant
to clause (i), (ii), (iii) or (v) above shall be applied to prepay Multicurrency
Advances then  outstanding  comprising  part of the same  Borrowings  until such
Advances are paid in full; and, in the case of prepayments of the  Multicurrency
Facility  required  pursuant to clause (i), (ii) or (iii) above,  (x) the amount
remaining (if any) after the  prepayment in full of the  Multicurrency  Advances
then outstanding (the sum of such prepayment  amounts and remaining amount being
referred to herein as the  "Multicurrency  Reduction Amount") may be retained by
the Company and (y) the Multicurrency  Facility shall be permanently  reduced as
set forth in Section 2.06(b)(vii).

                  (xii) All prepayments  under this subsection (b) shall be made
together with accrued  interest to the date of such  prepayment on the principal
amount prepaid.

                  SECTION 2.08. Interest. (a) Scheduled Interest.  Each Borrower
shall pay interest on the unpaid  principal amount of each Advance owing to each
Lender from the date of such Advance until such  principal  amount shall be paid
in full, at the following rates per annum:

                  (i) Base Rate Advances. During such periods as such Advance is
         a Base Rate Advance,  a rate per annum equal at all times to the sum of
         (A) the Base Rate in effect  from time to time plus (B) the  Applicable
         Margin in effect from time to time,  payable in arrears  monthly on the
         first day of each month  during such  periods and on the date such Base
         Rate Advance shall be Converted or paid in full.




<PAGE>   65


                                       59

                  (ii) Eurocurrency  Rate Advances.  During such periods as such
         Advance is a Eurocurrency  Rate Advance,  a rate per annum equal at all
         times  during each  Interest  Period for such Advance to the sum of (A)
         the  Eurocurrency  Rate for such Interest  Period for such Advance plus
         (B) the  Applicable  Margin in effect  from  time to time,  payable  in
         arrears on the last day of such  Interest  Period and, if such Interest
         Period  has a  duration  of more than  three  months,  on each day that
         occurs  during such  Interest  Period every three months from the first
         day of such  Interest  Period  and on the date such  Eurocurrency  Rate
         Advance shall be Converted or paid in full.

                  (iii) Local Rate Advances. During such periods as such Advance
         is a Local Rate Advance, a rate per annum equal at all times to the sum
         of (A) the  Local  Rate in  effect  from  time  to  time  plus  (B) the
         Applicable  Margin for Local Rate Advances in effect from time to time,
         payable in arrears quarterly on the first day of each October, January,
         April and July  during  such  periods  and on the date such  Local Rate
         Advance shall be Converted or paid in full.

                  (b)  Default  Interest.  Upon the  occurrence  and  during the
continuance  of a Default,  each  Borrower  shall pay interest on (i) the unpaid
principal amount of each Advance owing by it to each Lender,  payable in arrears
on the dates  referred to in clause  (a)(i),  (a)(ii) or  (a)(iii)  above and on
demand,  at a rate per annum  equal at all times to 2% per annum  above the rate
per annum required to be paid on such Advance pursuant to clause (a)(i), (a)(ii)
or (a)(iii) above and (ii) to the fullest extent permitted by law, the amount of
any interest,  fee or other amount  payable under the Loan Documents that is not
paid when due, from the date such amount shall be due until such amount shall be
paid in full,  payable in arrears on the date such amount  shall be paid in full
and on demand,  at a rate per annum equal at all times to 2% per annum above the
rate per annum  required  to be paid,  in the case of  interest,  on the Type of
Advance on which such interest has accrued pursuant to clause (a)(i), (a)(ii) or
(a)(iii) above and, in all other cases, on Base Rate Advances pursuant to clause
(a)(i) above.

                  (c) Notice of  Interest  Period and  Interest  Rate.  Promptly
after receipt of a Notice of Borrowing  pursuant to Section 2.02(a), a notice of
Conversion  pursuant  to Section  2.10 or a notice of  selection  of an Interest
Period  pursuant  to the  terms of the  definition  of  "Interest  Period",  the
Administrative  Agent  shall give  notice to the  applicable  Borrower  and each
Appropriate Lender of the applicable Interest Period and the applicable interest
rate  determined  by the  Administrative  Agent for purposes of clause (a)(i) or
(a)(ii) above, and the applicable rate, if any, furnished by each Reference Bank
for the purpose of determining the applicable interest rate under clause (a)(ii)
above.

                  (d)  Interest  Rate  Determination.  (i) Each  Reference  Bank
agrees to furnish to the Administrative Agent timely information for the purpose
of determining each Eurocurrency Rate. If any one or more of the Reference Banks
shall not furnish such timely information to the



<PAGE>   66


                                       60

Administrative  Agent for the purpose of determining any such interest rate, the
Administrative  Agent shall  determine such interest rate on the basis of timely
information furnished by the remaining Reference Banks.

                  (ii) If fewer  than two  Reference  Banks are able to  furnish
timely information to the Administrative  Agent for determining the Eurocurrency
Rate for any Eurocurrency Rate Advances,

                  (A)  the  Administrative  Agent  shall  forthwith  notify  the
         applicable  Borrower and the Lenders  that the interest  rate cannot be
         determined for such Eurocurrency Rate Advances,

                  (B) each such Advance will  automatically,  on the last day of
         the then existing  Interest Period therefor,  (1) if such  Eurocurrency
         Rate Advance is denominated in Dollars, be prepaid by the Company or be
         automatically  Converted  into a Base  Rate  Advance  and  (2) if  such
         Eurocurrency  Rate Advance is denominated in any Foreign  Currency,  be
         prepaid by the Foreign  Borrowers or be automatically  Converted into a
         Local Rate Advance of such Foreign Currency (or if such Advance is then
         a Base Rate Advance or a Local Rate  Advance,  will  continue as a Base
         Rate Advance or a Local Rate Advance), and

                  (C) the  obligation  of the  Lenders  to make,  or to  Convert
         Advances into,  Eurocurrency Rate Advances shall be suspended until the
         Administrative  Agent  shall  notify the  applicable  Borrower  and the
         Lenders that the circumstances causing such suspension no longer exist.

                  (e) BA Rate Determination. (i) If the Reuters Screen CDOR Page
is not  available  for the timely  determination  of the BA Rate,  the  Canadian
Reference  Lender  agrees  to  furnish  to  the   Administrative   Agent  timely
information for the purpose of determining the BA Rate.

                  (ii) If the Reuters  Screen CDOR Page is not available for the
timely  determination  of the BA Rate, and the Canadian  Reference Lender is not
able to furnish timely information to the  Administrative  Agent for determining
the BA Rate for any Bankers' Acceptances,

                  (A)  the  Administrative  Agent  shall  forthwith  notify  the
         Canadian  Borrower  and the Lenders  that the  interest  rate cannot be
         determined for such Bankers' Acceptances, and

                  (B) the  obligation  of the  Lenders  to  make,  or to  renew,
         Bankers'  Acceptances shall be suspended until the Administrative Agent
         shall   notify  the   Canadian   Borrower  and  the  Lenders  that  the
         circumstances causing such suspension no longer exist.



<PAGE>   67


                                       61

                  (f)  Interest  Act  (Canada).  Whenever  a  rate  of  interest
hereunder  is  calculated  on the  basis of a year  (the  "deemed  year")  which
contains  fewer  days than the  actual  number of days in the  calendar  year of
calculation,  such rate of  interest  shall be  expressed  as a yearly  rate for
purposes of the Interest Act  (Canada) by  multiplying  such rate of interest by
the actual number of days in the calendar year of calculation and dividing it by
the number of days in the deemed year.

                  (g) Nominal Rates;  No Deemed  Reinvestment.  The principle of
deemed  reinvestment  of interest  shall not apply to any  interest  calculation
under this Agreement;  all interest  payments to be made hereunder shall be paid
without  allowance or deduction for reinvestment or otherwise,  before and after
maturity,  default  and  judgment.  The  rates  of  interest  specified  in this
Agreement  are intended to be nominal rates and not  effective  rates.  Interest
calculated  hereunder shall be calculated  using the nominal rate method and not
the effective rate method of calculation.

                  (h) Interest  Paid by the Canadian  Borrower.  Notwithstanding
any provision of this Agreement,  in no event shall the aggregate "interest" (as
defined in Section 347 of the Criminal  Code  (Canada))  payable by the Canadian
Borrower  under this Agreement  exceed the effective  annual rate of interest on
the "credit advanced" (as defined in the Section) under this Agreement  lawfully
permitted by that Section and, if any payment,  collection or demand pursuant to
this  Agreement  in respect  of  "interest"  (as  defined  in that  Section)  is
determined  to be contrary to the  provisions  of that  Section,  such  payment,
collection or demand shall be deemed to have been made by mutual  mistake of the
Canadian  Borrower and the Lenders and the amount of such payment or  collection
shall be refunded to the Canadian Borrower.  For the purposes of this Agreement,
the effective  annual rate of interest  shall be  determined in accordance  with
generally  accepted  actuarial  practices and principles  over the relevant term
and,  in the event of a  dispute,  a  certificate  of a Fellow  of the  Canadian
Institute of Actuaries  appointed by the Lenders will be prima facie evidence of
such rate.

                  SECTION 2.09.  Fees. (a) Commitment Fee. The Company shall pay
to the  Administrative  Agent for the account of the Lenders a  commitment  fee,
from the date hereof in the case of each Initial  Lender and from the  effective
date specified in the  Assignment  and Acceptance  pursuant to which it became a
Lender in the case of each other Lender until the Termination  Date,  payable in
arrears on the date of the initial Borrowing  hereunder,  thereafter  monthly on
the first day of each month,  commencing  August 1, 1998, and on the Termination
Date,  at the rate of the  Applicable  Percentage  on the average  daily  unused
portion of each  Appropriate  Lender's  Delayed Draw  Commitment  and its Unused
Multicurrency  Commitment  and on the sum of the average daily Unused  Revolving
Credit  Commitment  of such Lender plus its Pro Rata Share of the average  daily
outstanding Swing Line Advances during such month;  provided,  however,  that no
commitment fee shall accrue on any of the Commitments of a Defaulting  Lender so
long as such Lender shall be a Defaulting Lender.


<PAGE>   68


                                       62

                  (b) Letter of Credit Fees,  Etc. (i) The Company  shall pay to
the  Administrative  Agent for the  account of each  Revolving  Credit  Lender a
commission,  payable in arrears quarterly on the first day of each March,  June,
September and December,  commencing  September 1, 1998,  and on the  Termination
Date, on such Lender's Pro Rata Share of the average daily  aggregate  Available
Amount  during such  quarter of all Letters of Credit  outstanding  from time to
time at the rate of the Applicable Margin for Letter of Credit fees.

                  (ii) The Company shall pay to each Issuing  Bank,  for its own
account,  such  commissions,  transfer  fees  and  other  fees  and  charges  in
connection with the issuance or  administration  of each Letter of Credit as the
Company and such Issuing Bank shall agree.

                  (c) Agents' Fees.  The Company shall pay to each Agent for its
own account such fees as may from time to time be agreed between the Company and
such Agent.

                  (d) Drawing Fees. The Canadian  Borrower shall, on the date of
each  Drawing  and on the  date  of each  renewal  of any  outstanding  Bankers'
Acceptances,  pay to the  Administrative  Agent,  in Canadian  Dollars,  for the
ratable account of the  Multicurrency  Lenders  accepting  Drafts and purchasing
Bankers' Acceptances, the Drawing Fee with respect to such Bankers' Acceptances.
The  Canadian  Borrower  irrevocably  authorizes  each such Lender to deduct the
Drawing Fee payable with respect to each Bankers' Acceptance of such Lender from
the Drawing  Purchase  Price  payable by such Lender in respect of such Bankers'
Acceptance in accordance  with Section 2.04 and to apply such amount so withheld
to the payment of such Drawing Fee for the account of the Canadian Borrower and,
to the extent such  Drawing Fee is so withheld  and legally  permitted  to be so
applied,  the Canadian  Borrower's  obligations under the preceding  sentence in
respect of such Drawing Fee shall be satisfied.

                  SECTION  2.10.  Conversion  of Advances.  (a)  Optional.  Each
Borrower may on any Business Day, upon notice given to the Administrative  Agent
not later than Noon (New York City time) on the third  Business Day prior to the
date of the proposed  Conversion  and subject to the provisions of Sections 2.08
and 2.12,  Convert all or any portion of the Advances of one Type comprising the
same  Borrowing  into Advances of the other Type;  provided,  however,  that any
Conversion of  Eurocurrency  Rate Advances into Base Rate Advances or Local Rate
Advances  shall  be made  only on the last day of an  Interest  Period  for such
Eurocurrency  Rate  Advances  and shall not  change the  currency  in which such
Advances are  denominated,  any  Conversion  of Base Rate Advances or Local Rate
Advances into Eurocurrency Rate Advances shall be in an amount not less than the
minimum amount specified in Section 2.02(c), no Conversion of any Advances shall
result in more separate Borrowings than permitted under Section 2.02(c) and each
Conversion of Advances  comprising part of the same Borrowing under any Facility
shall be made ratably among the  Appropriate  Lenders in  accordance  with their
Commitments under such Facility.  Each such notice of Conversion  shall,  within
the restrictions specified above, specify (i) the date of such Conversion,  (ii)
the Advances to be Converted and (iii) if such Conversion is



<PAGE>   69


                                       63

into Eurocurrency Rate Advances, the duration of the initial Interest Period for
such Advances. Each notice of Conversion shall be irrevocable and binding on the
Borrower giving such notice.

                  (b) Mandatory.  (i) On the date on which the aggregate  unpaid
principal amount of Eurocurrency Rate Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $10,000,000, in the
case of Term A Borrowings  and Term B Borrowings or  $2,500,000,  in the case of
Revolving  Credit   Borrowings,   Multicurrency   Borrowings  and  Delayed  Draw
Borrowings,  such Advances shall  automatically  (i) if such  Eurocurrency  Rate
Advances are denominated in Dollars, Convert into Base Rate Advances and (ii) if
such  Eurocurrency  Rate  Advances are  denominated  in a Foreign  Currency,  be
Converted into Local Rate Advances of such Foreign Currency.

                  (ii) If any Borrower  shall fail to select the duration of any
Interest  Period for any  Eurocurrency  Rate  Advances  in  accordance  with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative  Agent will forthwith so notify such Borrower and the Appropriate
Lenders,  whereupon each such Eurocurrency Rate Advance will  automatically,  on
the  last  day of the  then  existing  Interest  Period  therefor,  (A) if  such
Eurocurrency  Rate Advances are  denominated in Dollars,  Convert into Base Rate
Advances and (B) if such Eurocurrency Rate Advances are denominated in a Foreign
Currency, be Converted into a Local Rate Advance of such Foreign Currency.

                  (iii) Upon the  occurrence  and during the  continuance of any
Default, (A) each Eurocurrency Rate Advance will automatically,  on the last day
of the then existing  Interest Period therefor,  (1) if such  Eurocurrency  Rate
Advances are denominated in Dollars,  Convert into Base Rate Advances and (2) if
such  Eurocurrency  Rate  Advances are  denominated  in a Foreign  Currency,  be
Converted  into a Local  Rate  Advance  of  such  Foreign  Currency  and (B) the
obligation of the Lenders to make,  or to Convert  Advances  into,  Eurocurrency
Rate Advances and the obligation of the Multicurrency Lenders to create or renew
Bankers' Acceptances shall be suspended.

                  SECTION 2.11. Renewal and Conversion of Bankers'  Acceptances.
(a) Optional Renewal. The Canadian Borrower may on any Business Day, upon notice
given to the Administrative Agent not later than 12:00 Noon (New York City time)
on a Business Day at least two  Business  Days prior to the date of the proposed
renewal and subject to the provisions of Section 2.12,  renew all or any portion
of the  Bankers'  Acceptances  comprising  part of the same  Drawing;  provided,
however, that:

                  (i) any renewal of Bankers'  Acceptances shall be made only on
         the then existing Maturity Date for such Bankers' Acceptances;


<PAGE>   70


                                       64

                  (ii) each renewal of Bankers'  Acceptances  comprising part of
         the same Drawing shall be made ratably among the Multicurrency  Lenders
         holding such Bankers'  Acceptances  in accordance  with the  respective
         amount of such Bankers' Acceptances so held; and

                  (iii) no renewal of any Bankers' Acceptance may be made at any
         time that a Default has occurred and is continuing.

Each such notice of renewal  shall,  within the  restrictions  set forth  above,
specify (A) the date of such renewal (which shall be the then existing  Maturity
Date of such Bankers' Acceptances and shall be a Business Day), (B) the Bankers'
Acceptances  to be  renewed,  (C) if less than all of the  Bankers'  Acceptances
comprising part of any Drawing are to be renewed,  the aggregate Face Amount for
such  renewal and (D) the term to maturity of the renewed  Bankers'  Acceptances
(which shall comply with the  definition  of "Maturity  Date" in Section  1.01);
provided,  however,  that, if the Administrative  Agent determines in good faith
(which determination shall be conclusive and binding upon the Canadian Borrower)
that the Bankers' Acceptances cannot, due solely to the requested aggregate Face
Amount thereof, be renewed ratably by the Multicurrency  Lenders,  the aggregate
Face Amount of such  renewal (or the Face Amount of Bankers'  Acceptances  to be
created by any  Multicurrency  Lender) shall be reduced to such lesser amount as
the  Administrative  Agent determines will permit such renewal to be so made and
each  Multicurrency  Lender  shall fund the  difference  between  such  Lender's
ratable  portion of the original  aggregate  Face Amount of such renewal and the
Face  Amount of the  Bankers'  Acceptances  to be created by such  Lender  after
giving  effect to such  reduction in the form of a Canadian  Prime Rate Advance,
which shall be deemed for all purposes hereof to be a Multicurrency Advance made
pursuant to Section  2.01(d).  Each notice of renewal under this Section 2.11(a)
shall be irrevocable and binding on the Canadian  Borrower.  Upon any renewal of
Bankers'  Acceptances  comprising  part of any Drawing in  accordance  with this
Section 2.11(a),  the Multicurrency  Lenders holding the Bankers' Acceptances to
be renewed shall exchange such maturing  Bankers'  Acceptances  for new Bankers'
Acceptances  containing the terms set forth in the applicable notice of renewal,
and the Drawing  Purchase  Price payable for each such renewal shall be applied,
together with other funds, if necessary,  available to the Canadian Borrower, to
reimburse the Bankers' Acceptances otherwise maturing on such date in accordance
with Section 2.05(e).  The Canadian Borrower hereby  irrevocably  authorizes and
directs each Multicurrency Lender to apply the proceeds of each renewed Bankers'
Acceptance  owing to it to the  reimbursement,  in accordance  with this Section
2.11(a),  of the Bankers'  Acceptances  owing to such  Multicurrency  Lender and
maturing on such date.

                  (b)  Optional  Conversion.  The  Canadian  Borrower may on any
Business Day, upon notice given to the Administrative Agent not later than 12:00
noon (Toronto time) on a Business Day at least two Canadian  Business Days prior
to the date of the proposed  Conversion and subject to the provisions of Section
2.12, Convert all or any portion of the Bankers'



<PAGE>   71


                                       65

Acceptances  comprising  part of the same Drawing to a  Multicurrency  Borrowing
comprised of Canadian Prime Rate Advances; provided, however, that:

                  (i) any Conversion of Bankers'  Acceptances shall be made only
         on the then existing Maturity Date for such Bankers' Acceptances;

                  (ii) each Conversion of Bankers'  Acceptances  comprising part
         of the same  Drawing  shall be made  ratably  among  the  Multicurrency
         Lenders  holding  such  Bankers'  Acceptances  in  accordance  with the
         respective amounts of such Bankers' Acceptances so held; and

                  (iii)  no  Conversion  may be made if (A)  the  amount  of the
         Advance to be made by any Multicurrency  Lender in connection with such
         Conversion   would   exceed   such   Multicurrency    Lender's   Unused
         Multicurrency  Commitment in effect at the time of such Conversion,  or
         (B) after giving  effect to such  Conversion,  the sum of the aggregate
         principal  amount  of  outstanding   Multicurrency  Advances  plus  the
         aggregate Face Amount of Bankers'  Acceptances then  outstanding  would
         exceed the Multicurrency Facility.

Each such notice of Conversion  shall,  within the restrictions set forth above,
specify  (A) the date of such  Conversion  (which  shall  be the  then  existing
Maturity Date of such Bankers' Acceptances and shall be a Business Day), (B) the
Bankers'  Acceptances  to be Converted  and (C) if less than all of the Bankers'
Acceptances  comprising  part of any Drawing are to be Converted,  the aggregate
Face Amount of such  Conversion.  Each notice of  Conversion  under this Section
2.11(b)  shall be  irrevocable  and binding on the Canadian  Borrower.  Upon any
Conversion  of  Bankers'  Acceptances  comprising  part of the same  Drawing  in
accordance with this Section 2.11(b), the obligation of the Canadian Borrower to
reimburse the Lenders under Section 2.13 in respect of the Bankers'  Acceptances
otherwise  maturing on such date  shall,  to the extent of such  Conversion,  be
Converted to an  obligation to reimburse  the Lenders  making the  Multicurrency
Advances  made in respect of such  maturing  Bankers'  Acceptances  on such date
ratably in accordance with the amount of the Advances held by such Lender at the
time of reimbursement.  The Canadian Borrower hereby irrevocably  authorizes and
directs each  Multicurrency  Lender to apply the net  proceeds of each  Canadian
Prime Rate Advance made by such Lender  pursuant to this Section  2.11(b) to the
reimbursement of the Bankers'  Acceptances  owing to such Lender and maturing on
such date.

                  (c) Mandatory  Conversion.  If any Default shall have occurred
and be  continuing  or if the  Canadian  Borrower  shall  fail (i) to  deliver a
properly  completed  notice of  renewal  under  Section  2.11(a)  or a  properly
completed notice of Conversion under Section 2.11(b) indicating its intention to
renew or to Convert any maturing  Bankers'  Acceptances or (ii) to reimburse the
Multicurrency  Lenders for any Bankers' Acceptances  comprising part of the same
Drawing  pursuant to Section 2.05,  the  Administrative  Agent will forthwith so
notify the



<PAGE>   72


                                       66

Canadian  Borrower and the Multicurrency  Lenders,  whereupon each such Bankers'
Acceptance  will  automatically,  on the  then  existing  Maturity  Date of such
Bankers' Acceptances, Convert into a Canadian Prime Rate Advance.

                  SECTION 2.12.  Increased Costs, Etc. (a) If, due to either (i)
the  introduction  of or any  change in or in the  interpretation  of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other  governmental  authority (whether or not having the force of law),
there shall be:

                  (A) any  increase in the cost to any Lender  Party of agreeing
         to make or of making, funding or maintaining Eurocurrency Rate Advances
         or of agreeing to issue or of issuing or maintaining  or  participating
         in Letters of Credit;

                  (B) any  increase in the cost to any Lender  Party of agreeing
         to perform or of performing its obligations  under this Agreement under
         or in respect of Bankers' Acceptances; or

                  (C) any reduction in any amount payable to, or any increase in
         any payment  required to be made by, or any forgiveness or reduction of
         effective  return to, any Lender Party under this Agreement under or in
         respect of any Bankers' Acceptances

(excluding,  for  purposes  of this  Section  2.12,  any  such  increased  costs
resulting  from (x) Taxes or Other Taxes (as to which Section 2.14 shall govern)
and (y) changes in the basis of taxation of overall net income or overall  gross
income by the United  States or by the foreign  jurisdiction  or state under the
laws of which such  Lender  Party is  organized  or has its  Applicable  Lending
Office or any political subdivision  thereof),  then each of the Borrowers shall
from time to time,  upon demand by such Lender Party (with a copy of such demand
to the Administrative Agent), pay to the Administrative Agent for the account of
such Lender Party additional  amounts sufficient to compensate such Lender Party
for such increased cost  attributable to such Borrower.  A certificate as to the
amount of such increased cost,  submitted to the Borrowers by such Lender Party,
shall be conclusive and binding for all purposes, absent manifest error.

                  (b) If, due to either (i) the introduction of or any change in
or in the  interpretation  of any law or regulation or (ii) the compliance  with
any guideline or request from any central bank or other governmental  authority,
including,  without  limitation,  any  agency of the  European  Union or similar
monetary or  multinational  authority  (whether or not having the force of law),
there shall be any increase in the amount of capital  required or expected to be
maintained by any Lender Party or any corporation  controlling such Lender Party
as a result of or based upon the existence of such Lender Party's  commitment to
lend,  to accept,  purchase and  discount  Bankers'  Acceptances  or to issue or
participate in Letters of Credit hereunder and other commitments of such type or
the purchase or acceptance and maintenance of Bankers'



<PAGE>   73


                                       67

Acceptances or the issuance or maintenance of or participation in the Letters of
Credit (or similar  contingent  obligations),  then,  upon demand by such Lender
Party or such  corporation  (with a copy of such  demand  to the  Administrative
Agent), the Borrowers shall pay to the  Administrative  Agent for the account of
such  Lender  Party,  from  time to  time as  specified  by such  Lender  Party,
additional  amounts  sufficient to compensate  such Lender Party in the light of
such circumstances,  to the extent that such Lender Party reasonably  determines
such increase in capital to be allocable to the existence of such Lender Party's
commitment to lend, to accept,  purchase and discount Bankers' Acceptances or to
issue  or  participate  in  Letters  of  Credit  hereunder  or the  purchase  or
acceptance  and  maintenance  of  Bankers'  Acceptances  or to the  issuance  or
maintenance of or  participation  in any Letters of Credit.  A certificate as to
such amounts submitted to the Borrowers by such Lender Party shall be conclusive
and binding for all purposes, absent manifest error.

                  (c) If, with respect to any  Eurocurrency  Rate Advances under
any Facility,  Lenders owed at least 51% of the then aggregate  unpaid principal
amount  thereof  notify  the  Administrative  Agent  that (i) they are unable to
obtain matching  deposits in the London inter-bank market at or about 11:00 A.M.
(London  time) on the second  Business Day before the making or  Conversion of a
Borrowing in sufficient amounts to fund their respective  Multicurrency Advances
as a part of such Borrowing  during its Interest Period or (ii) the Eurocurrency
Rate for any Interest  Period for such Advances will not adequately  reflect the
cost  to such  Lenders  of  making,  funding  or  maintaining  their  respective
Eurocurrency Rate Advances for such Interest Period,  the  Administrative  Agent
shall forthwith so notify the applicable  Borrower and the Appropriate  Lenders,
whereupon (A) such Borrower will, on the last day of the then existing  Interest
Period  therefor,  (1) if such  Eurocurrency  Rate Advances are  denominated  in
Dollars,  either (x) prepay such Advances or (y) Convert such Advances into Base
Rate Advances and (2) if such  Eurocurrency Rate Advances are denominated in any
Foreign  Currency,  either (x) prepay such Advances or (y) Convert such Advances
into Local Rate Advances of such Foreign  Currency and (B) the obligation of the
Appropriate  Lenders to make, or to Convert  Advances  into,  Eurocurrency  Rate
Advances  shall be  suspended  until the  Administrative  Agent shall notify the
applicable Borrower and the Appropriate  Lenders that the circumstances  causing
such suspension no longer exist;  provided that, if the  circumstances set forth
in clause (ii) above are applicable,  the applicable Foreign Borrower may elect,
by notice to the Administrative Agent and the Multicurrency Lenders, to continue
such Multicurrency Advances in such Foreign Currency for Interest Periods of not
longer  than one month,  which  Multicurrency  Advances  shall  thereafter  bear
interest  at a rate per annum  equal to the  Applicable  Margin  plus,  for each
Multicurrency Lender, the cost to such Multicurrency Lender (expressed as a rate
per annum) of funding  its  Eurocurrency  Rate  Advances  by  whatever  means it
reasonably determines to be appropriate. Each Multicurrency Lender shall certify
its cost of funds for each Interest Period to the  Administrative  Agent and the
applicable  Foreign  Borrower as soon as practicable (but in any event not later
than ten Business Days after the first day of such Interest Period).




<PAGE>   74


                                       68

                  (d) Notwithstanding any other provision of this Agreement,  if
the  introduction  of or any  change in or in the  interpretation  of any law or
regulation  shall make it unlawful,  or any central  bank or other  governmental
authority shall assert that it is unlawful,  for any Lender or its  Eurocurrency
Lending Office to perform its obligations  hereunder to make  Eurocurrency  Rate
Advances in Dollars or any  Foreign  Currency or to continue to fund or maintain
Eurocurrency Rate Advances in Dollars or any Foreign Currency  hereunder,  then,
on notice  thereof and demand  therefor by such Lender to the Borrowers  through
the Administrative Agent, (i) each Eurocurrency Rate Advance under each Facility
under which such Lender has a Commitment will  automatically,  upon such demand,
(A) if such  Eurocurrency  Rate Advance is denominated in Dollars,  be Converted
into a Base  Rate  Advance,  and  (B)  if  such  Eurocurrency  Rate  Advance  is
denominated in any Foreign  Currency,  be Converted into a Local Rate Advance of
such Foreign  Currency,  and (ii) the obligation of the  Appropriate  Lenders to
make, or to Convert Advances into, Eurocurrency Rate Advances shall be suspended
until the  Administrative  Agent shall notify the Borrowers that such Lender has
determined that the circumstances causing such suspension no longer exist.

                  (e) Notwithstanding any other provision of this Agreement,  if
the introduction of or any change in the interpretation of any law or regulation
(including,  without limitation,  any change in acceptance limits imposed on any
Lender)  shall  make it  unlawful,  or any  central  bank or other  governmental
authority shall assert that it is unlawful,  for any Multicurrency Lender or any
of their  respective BA Lending Offices to perform its obligations  hereunder to
complete and accept Drafts, to purchase  Bankers'  Acceptances or to continue to
fund or maintain Bankers' Acceptances  hereunder,  then, upon notice thereof and
demand therefor by such  Multicurrency  Lender to the Canadian  Borrower through
the Administrative Agent (i) an amount equal to the aggregate Face Amount of all
Bankers' Acceptances  outstanding at such time held by such Multicurrency Lender
shall,  upon such demand  (which  shall only be made if deemed  necessary by the
applicable  Lender to comply with applicable  law), be deposited by the Canadian
Borrower  into the Canadian Cash  Collateral  Account until the Maturity Date of
each such  Bankers'  Acceptance,  (ii) upon the  Maturity  Date of any  Bankers'
Acceptance   in  respect  of  which  any  such   deposit  has  been  made,   the
Administrative  Agent shall be, and hereby is, authorized  (without notice to or
any  further  action  by the  Canadian  Borrower)  to apply,  or to  direct  the
Administrative  Agent to apply, such amount (or the applicable  portion thereof)
to the reimbursement of such Bankers' Acceptance and (iii) the obligation of the
Multicurrency  Lenders to complete and accept Drafts and/or to purchase Bankers'
Acceptances shall be suspended until the  Administrative  Agent shall notify the
Canadian  Borrower  that  such  Multicurrency  Lender  has  determined  that the
circumstances causing such suspension no longer exist.

                  SECTION  2.13.  Payments and  Computations.  (a) Each Borrower
shall make each payment hereunder and under the Notes, irrespective of any right
of  counterclaim  or set-off  (except as  otherwise  provided in Section  2.17),
except with respect to principal of, interest on, and other amounts relating to,
Advances denominated in a Foreign Currency, not later than



<PAGE>   75


                                       69

11:00  A.M.  (New  York  City  time)  on the  day  when  due in  Dollars  to the
Administrative  Agent at the applicable  Administrative  Agent's Account in same
day funds,  with  payments  received  after such time being  deemed to have been
received on the next succeeding  Business Day. The Foreign  Borrowers shall make
each payment  hereunder  with respect to  principal  of,  interest on, and other
amounts  relating to,  Advances  denominated in a Foreign  Currency and Bankers'
Acceptances,  not later than 11:00 A.M. (at the Payment  Office for such Foreign
Currency)  on the  day  when  due in such  Foreign  Currency  to the  applicable
Administrative  Agent  in same  day  funds,  by  deposit  of such  funds  to the
applicable  Administrative  Agent's  Account  in same day funds,  with  payments
received by the  Administrative  Agent or such  Sub-Agent  after such time being
deemed  to  have  been  received  on  the  next  succeeding  Business  Day.  The
Administrative Agent will promptly thereafter cause like funds to be distributed
(i) if such payment is in respect of principal, interest, commitment fees or any
other  Obligation  then payable  hereunder  and under the Notes to more than one
Lender  Party,  to such  Lender  Parties  for the  account  of their  respective
Applicable  Lending  Offices  ratably  in  accordance  with the  amounts of such
respective  Obligations  then  payable to such  Lender  Parties and (ii) if such
payment is in respect of any  Obligation  then  payable  hereunder to one Lender
Party, to such Lender Party for the account of its Applicable Lending Office, in
each case to be applied in accordance with the terms of this Agreement. Upon its
acceptance  of an Assignment  and  Acceptance  and recording of the  information
contained  therein in the Register  pursuant to Section 9.07(d),  from and after
the effective date of such Assignment and Acceptance,  the Administrative  Agent
shall make all payments hereunder and under the Notes in respect of the interest
assigned  thereby to the Lender Party  assignee  thereunder,  and the parties to
such Assignment and Acceptance  shall make all  appropriate  adjustments in such
payments for periods prior to such effective date directly between themselves.

                  (b) Each Borrower hereby  authorizes each Lender Party, if and
to the extent  payment owed to such Lender Party is not made when due  hereunder
or, in the case of a Lender,  under the Note held by such Lender, to charge from
time to time  against any or all of such  Borrower's  accounts  with such Lender
Party any amount so due.

                  (c) All  computations  of interest,  fees and Letter of Credit
commissions shall be made by the Administrative  Agent on the basis of a year of
360 days (or, in each case of Advances  denominated in Foreign  Currencies where
market  practice   differs,   in  accordance  with  market   practice)  and  all
computations   of  interest   based  on  the  BA  Rate  shall  be  made  by  the
Administrative  Agent on the basis of a year of 365  days,  in each case for the
actual  number of days  (including  the first  day but  excluding  the last day)
occurring  in the  period  for which  such  interest,  fees or  commissions  are
payable. Each determination by the Administrative Agent of an interest rate, fee
or commission hereunder shall be conclusive and binding for all purposes, absent
manifest error.

                  (d)  Whenever  any payment  hereunder or under the Notes or in
respect of Bankers'  Acceptances shall be stated to be due on a day other than a
Business Day, such payment



<PAGE>   76


                                       70

shall be made on the next  succeeding  Business Day, and such  extension of time
shall in such case be  included  in the  computation  of payment of  interest or
commitment fee, as the case may be; provided,  however,  that, if such extension
would cause payment of interest on or principal of Eurocurrency Rate Advances to
be made in the next following  calendar month, such payment shall be made on the
next preceding Business Day.

                  (e) Unless the Administrative Agent shall have received notice
from the  applicable  Borrower  prior to the date on which any payment is due to
any Lender  Party  hereunder  that such  Borrower  will not make such payment in
full,  the  Administrative  Agent may assume  that such  Borrower  has made such
payment in full to the Administrative  Agent on such date and the Administrative
Agent may, in reliance upon such  assumption,  cause to be  distributed  to each
such Lender  Party on such due date an amount  equal to the amount then due such
Lender  Party.  If and to the extent such  Borrower  shall not have so made such
payment in full to the Administrative  Agent, each such Lender Party shall repay
to the Administrative  Agent forthwith on demand such amount distributed to such
Lender Party  together  with interest  thereon,  for each day from the date such
amount is  distributed  to such Lender  Party  until the date such Lender  Party
repays such amount to the Administrative Agent at, (i) the Federal Funds Rate in
the case of Advances  denominated  in Dollars or (ii) the cost of funds incurred
by the  Administrative  Agent in respect of such  amount in the case of Advances
denominated in Foreign Currencies.

                  (f) If the Administrative Agent receives funds for application
to the Obligations  under the Loan Documents under  circumstances  for which the
Loan  Documents  do not specify the  Advances or the  Facility to which,  or the
manner in which, such funds are to be applied, the Administrative Agent may, but
shall not be obligated to, elect to  distribute  such funds to each Lender Party
ratably  in  accordance  with such  Lender  Party's  proportionate  share of the
principal amount of all outstanding Advances, the Face Amount of all outstanding
Bankers'  Acceptances  and the  Available  Amount of all  Letters of Credit then
outstanding,  in repayment or prepayment of such of the outstanding  Advances or
other  Obligations  owed to such  Lender  Party,  and  for  application  to such
principal installments, as the Administrative Agent shall direct.

                  SECTION 2.14.  Taxes. (a) Any and all payments by any Borrower
hereunder or under the Notes or in respect of any Bankers'  Acceptances shall be
made, in accordance with Section 2.13,  free and clear of and without  deduction
for any and all present or future taxes, levies, imposts, deductions, charges or
withholdings,  and all liabilities with respect thereto,  excluding, in the case
of each Lender  Party and each Agent,  taxes that are imposed on its overall net
income by the United States and taxes that are imposed on its overall net income
(and  franchise  taxes  imposed  in  lieu  thereof)  by  the  state  or  foreign
jurisdiction  under the laws of which such Lender  Party or such  Agent,  as the
case may be, is organized or any political  subdivision thereof and, in the case
of each  Lender  Party,  taxes that are  imposed on its  overall net income (and
franchise taxes imposed in lieu thereof) by the state or foreign jurisdiction of
such Lender  Party's  Applicable  Lending  Office or any  political  subdivision
thereof (all such non-excluded



<PAGE>   77


                                       71

taxes, levies,  imposts,  deductions,  charges,  withholdings and liabilities in
respect of payments  hereunder  or under the Notes or in respect of any Bankers'
Acceptances being hereinafter referred to as "Taxes").  If any Borrower shall be
required  by law to  deduct  any Taxes  from or in  respect  of any sum  payable
hereunder  or under any Note or in respect of any  Bankers'  Acceptances  to any
Lender Party or any Agent or, if the  Administrative  Agent shall be required by
law to deduct any Taxes from or in respect of any sum  payable  hereunder  or in
respect of any Bankers'  Acceptances to any Lender Party, (i) the sum payable by
such Borrower shall be increased as may be necessary so that after such Borrower
and the  Administrative  Agent  have  made all  required  deductions  (including
deductions  applicable to additional  sums payable under this Section 2.14) such
Lender Party or such Agent,  as the case may be, receives an amount equal to the
sum it would have received had no such  deductions been made, (ii) such Borrower
shall make all such deductions and (iii) such Borrower shall pay the full amount
deducted to the relevant  taxation  authority or other  authority in  accordance
with applicable law.

                  (b) In addition, each Borrower shall pay any present or future
stamp,  documentary  taxes or any other  excise or  property  taxes,  charges or
similar  levies that arise from any payment made hereunder or under the Notes or
in  respect of any  Bankers'  Acceptances  or from the  execution,  delivery  or
registration of, performance under, or otherwise with respect to, this Agreement
, the Notes,  any  Letters of Credit or any  Bankers'  Acceptances  (hereinafter
referred to as "Other Taxes").

                  (c) Each Borrower  shall  indemnify each Lender Party and each
Agent  for and hold them  harmless  against  the full  amount of Taxes and Other
Taxes,  and for the full amount of taxes of any kind imposed by any jurisdiction
on amounts  payable under this Section  2.14,  imposed on or paid by such Lender
Party or such Agent (as the case may be) and any liability (including penalties,
additions  to tax,  interest  and  expenses)  arising  therefrom or with respect
thereto.  This  indemnification  shall be made within 30 days from the date such
Lender Party or such Agent (as the case may be) makes written demand therefor.

                  (d)  Within 30 days  after the date of any  payment  of Taxes,
each Borrower shall furnish to the Administrative Agent, at its address referred
to in Section  9.02,  the original or a certified  copy of a receipt  evidencing
such payment. In the case of any payment hereunder,  under the Notes, in respect
of any  Letters  of Credit or in respect of any  Bankers'  Acceptances  by or on
behalf of such Borrower  through an account or branch outside the United States,
the United  Kingdom  and Canada or by or on behalf of such  Borrower  by a payor
that is not a United States person or a corporation  organized under the laws of
the United  Kingdom or Canada,  if such  Borrower  determines  that no Taxes are
payable in respect  thereof,  such Borrower shall  furnish,  or shall cause such
payor to furnish,  to the Administrative  Agent, at such address,  an opinion of
counsel  reasonably  acceptable  to the  Administrative  Agent stating that such
payment is exempt from Taxes.  For purposes of  subsections  (d) and (e) of this
Section 2.14, the terms "United



<PAGE>   78


                                       72

States" and "United States person" shall have the meanings  specified in Section
7701 of the Internal Revenue Code.

                  (e)  Each  Lender  Party   organized   under  the  laws  of  a
jurisdiction  outside the United  States  shall,  on or prior to the date of its
execution and delivery of this  Agreement in the case of each Initial  Lender or
Initial  Issuing Bank, as the case may be, and on the date of the Assignment and
Acceptance pursuant to which it becomes a Lender Party in the case of each other
Lender  Party,  and from time to time  thereafter as requested in writing by any
Borrower (but only so long thereafter as such Lender Party remains lawfully able
to do so),  provide  each of the  Administrative  Agent and the Company with any
form or  certificate  that is required by any taxing  authority,  including,  if
applicable,  two original Internal Revenue Service forms 1001 or 4224 or (in the
case of a Lender Party that has certified in writing to the Administrative Agent
that it is not a "bank" as  defined  in  Section  881(c)(3)(A)  of the  Internal
Revenue  Code)  form W-8 (and,  if such  Lender  Party  delivers  a form W-8,  a
certificate  representing that such Lender Party is not a "bank" for purposes of
Section  881(c) of the Internal  Revenue Code,  is not a 10-percent  shareholder
(within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code) of the
Company  and is not a  controlled  foreign  corporation  related to the  Company
(within the meaning of Section  864(d)(4) of the  Internal  Revenue  Code)),  as
appropriate,  or any successor or other form prescribed by the Internal  Revenue
Service,  certifying  that such  Lender  Party is exempt  from or  entitled to a
reduced  rate of Home  Jurisdiction  Withholding  Taxes  (as  defined  below) on
payments  pursuant to this  Agreement or the Notes or in respect of any Bankers'
Acceptances or, in the case of a Lender Party  providing a form W-8,  certifying
that such Lender Party is a foreign corporation,  partnership,  estate or trust.
If the forms  provided  by a Lender  Party at the time such  Lender  Party first
becomes a party to this Agreement indicate a United States interest  withholding
tax rate in excess of zero,  withholding  tax at such rate  shall be  considered
excluded from Taxes unless and until such Lender Party provides the  appropriate
forms certifying that a lesser rate applies,  whereupon  withholding tax at such
lesser rate only shall be considered excluded from Taxes for periods governed by
such forms; provided,  however, that if, at the effective date of the Assignment
and  Acceptance  pursuant  to  which a  Lender  Party  becomes  a party  to this
Agreement,  the Lender Party assignor was entitled to payments under  subsection
(a) of this  Section  2.14 in  respect  of United  States  withholding  tax with
respect to interest  paid at such date,  then,  to such  extent,  the term Taxes
shall  include  (in  addition  to  withholding  taxes that may be imposed in the
future or other amounts otherwise includable in Taxes) United States withholding
tax, if any,  applicable with respect to the Lender Party assignee on such date.
If any  form  or  document  referred  to in this  subsection  (e)  requires  the
disclosure of information,  other than information  necessary to compute the tax
payable and information  required on the date hereof by Internal Revenue Service
form 1001, 4224 or W-8 (or the related  certificate  described above),  that the
Lender Party  reasonably  considers to be  confidential,  the Lender Party shall
give notice  thereof to the  Borrowers  and shall not be obligated to include in
such form or document such confidential information.




<PAGE>   79


                                       73

                  "Home Jurisdiction Withholding Taxes" means (a) in the case of
the Company,  withholding taxes imposed by the United States, (b) in the case of
HHEL and Rigby, withholding taxes imposed by the United Kingdom, (c) in the case
of the Canadian  Borrower,  withholding  taxes  imposed by Canada and (d) in the
case of Danmark, withholding taxes imposed by Denmark.

                  (f) For any period  with  respect to which a Lender  Party has
failed  to  provide  the  Borrowers  with  the  appropriate  form  described  in
subsection  (e)  above  (other  than if such  failure  is due to a change in law
occurring  after the date on which a form originally was required to be provided
or if such form  otherwise is not required  under  subsection  (e) above),  such
Lender Party shall not be entitled to  indemnification  under  subsection (a) or
(c) of this Section 2.14 with respect to Taxes imposed by the United States, the
United  Kingdom or Canada by reason of such  failure;  provided,  however,  that
should a Lender Party become  subject to Taxes because of its failure to deliver
a form required  hereunder,  the Borrowers  shall take such steps as such Lender
Party  shall  reasonably  request to assist such  Lender  Party to recover  such
Taxes.

                  (g) Each Lender Party shall  promptly  upon the request of the
Administrative   Agent  take  all  action  (including   without  limitation  the
completion of forms and the provision of information to the  appropriate  taxing
authorities  or  to  the  Administrative  Agent),  of  the  kind  prescribed  in
regulations  promulgated  under Section 118H of the U.K.  Income and Corporation
Taxes Act of 1988 (and any statements  published by the Inland Revenue  relating
thereto and having general  application) and consistent with such Lender Party's
legal and regulatory  restrictions,  reasonably  requested by the Administrative
Agent,  and the  Administrative  Agent shall upon  reasonable  request  from any
Foreign  Borrower  make such  request  of each  Lender  Party  and shall  itself
(consistent with the Administrative Agent's legal and regulatory  restrictions),
to the extent  appropriate  and reasonable,  take similar action,  to secure the
benefit of any  exemption  from, or relief with respect to, Taxes or Other Taxes
imposed  by the  United  Kingdom  under  Section  118H of the  U.K.  Income  and
Corporation  Taxes Act of 1988 in  relation to any  amounts  payable  under this
Agreement.

                  (h) Any Lender Party claiming any additional  amounts  payable
pursuant  to this  Section  2.14  agrees  to use  its  reasonable  best  efforts
(consistent  with its internal policy and legal and regulatory  restrictions) to
change the jurisdiction of its Applicable Lending Office if the making of such a
change  would avoid the need for,  or reduce the amount of, any such  additional
amounts that may thereafter accrue and would not, in the reasonable  judgment of
such Lender Party, be otherwise disadvantageous to such Lender Party.

                  SECTION  2.15.  Sharing of Payments,  Etc. If any Lender Party
shall obtain at any time any payment (whether  voluntary,  involuntary,  through
the exercise of any right of set-off, or otherwise, other than as a result of an
assignment  pursuant  to Section  9.07) (a) on account  of  Obligations  due and
payable to such Lender Party hereunder and under the Notes and Bankers'



<PAGE>   80


                                       74

Acceptances  at such time in  excess  of its  ratable  share  (according  to the
proportion of (i) the amount of such  Obligations due and payable to such Lender
Party at such  time to (ii) the  aggregate  amount  of the  Obligations  due and
payable  to all  Lender  Parties  hereunder  and under  the  Notes and  Bankers'
Acceptances  at such time) of  payments  on account of the  Obligations  due and
payable  to all  Lender  Parties  hereunder  and under  the  Notes and  Bankers'
Acceptances  at such time obtained by all the Lender Parties at such time or (b)
on account of  Obligations  owing (but not due and payable) to such Lender Party
hereunder and under the Notes and Bankers' Acceptances at such time in excess of
its  ratable  share  (according  to the  proportion  of (i) the  amount  of such
Obligations owing to such Lender Party at such time to (ii) the aggregate amount
of the  Obligations  owing  (but  not due and  payable)  to all  Lender  Parties
hereunder and under the Notes and Bankers' Acceptances at such time) of payments
on account of the  Obligations  owing  (but not due and  payable)  to all Lender
Parties  hereunder  and under the Notes and  Bankers'  Acceptances  at such time
obtained  by all of the Lender  Parties at such time,  such  Lender  Party shall
forthwith purchase from the other Lender Parties such interests or participating
interests in the  Obligations  due and payable or owing to them, as the case may
be, as shall be  necessary  to cause such  purchasing  Lender Party to share the
excess payment ratably with each of them; provided,  however, that if all or any
portion of such excess  payment is  thereafter  recovered  from such  purchasing
Lender Party,  such purchase from each other Lender Party shall be rescinded and
such other Lender Party shall repay to the purchasing  Lender Party the purchase
price to the extent of such  Lender  Party's  ratable  share  (according  to the
proportion  of (i) the  purchase  price  paid to such  Lender  Party to (ii) the
aggregate  purchase price paid to all Lender Parties) of such recovery  together
with an amount equal to such Lender  Party's  ratable  share  (according  to the
proportion of (i) the amount of such other Lender Party's required  repayment to
(ii) the total  amount so recovered  from the  purchasing  Lender  Party) of any
interest  or other  amount  paid or payable by the  purchasing  Lender  Party in
respect of the total amount so recovered;  provided further that, so long as the
Obligations under the Loan Documents shall not have been accelerated, any excess
payment  received by any Appropriate  Lender shall be shared on a pro rata basis
only with other Appropriate Lenders.  Each Borrower agrees that any Lender Party
so purchasing an interest or  participating  interest from another  Lender Party
pursuant  to this  Section  2.15 may, to the fullest  extent  permitted  by law,
exercise all its rights of payment (including the right of set-off) with respect
to such an interest or participating  interest,  as the case may be, as fully as
if such Lender Party were the direct  creditor of such Borrower in the amount of
such an interest or participating interest, as the case may be.

                  SECTION 2.16.  Use of Proceeds.  The proceeds of the Advances,
Bankers'  Acceptances and issuances of Letters of Credit shall be available (and
each  Borrower  agrees  that it shall use such  proceeds  and Letters of Credit)
solely to pay transaction fees and expenses,  refinance certain Existing Debt of
the Company,  provide working capital for the Company and its  Subsidiaries  and
for other general corporate purposes permitted by this Agreement.




<PAGE>   81


                                       75

                  SECTION 2.17.  Defaulting  Lenders.  (a) In the event that, at
any one time,  (i) any Lender  Party  shall be a  Defaulting  Lender,  (ii) such
Defaulting  Lender shall owe a Defaulted  Advance to any Borrower and (iii) such
Borrower shall be required to make any payment hereunder or under any other Loan
Document to or for the account of such  Defaulting  Lender,  then such  Borrower
may, so long as no Default  shall occur or be continuing at such time and to the
fullest  extent  permitted by applicable  law, set off and  otherwise  apply the
Obligation  of such  Borrower to make such payment to or for the account of such
Defaulting  Lender against the obligation of such Defaulting Lender to make such
Defaulted Advance. In the event that, on any date, any Borrower shall so set off
and  otherwise  apply  its  obligation  to make any  such  payment  against  the
obligation of such  Defaulting  Lender to make any such Defaulted  Advance on or
prior to such date, the amount so set off and otherwise applied by such Borrower
shall constitute for all purposes of this Agreement and the other Loan Documents
an Advance by such  Defaulting  Lender made on the date of such setoff under the
Facility  pursuant to which such Defaulted  Advance was  originally  required to
have been made  pursuant  to Section  2.01.  Such  Advance  shall be a Base Rate
Advance or a Local Rate  Advance,  as the case may be, and shall be  considered,
for all  purposes  of this  Agreement,  to  comprise  part of the  Borrowing  in
connection  with which such Defaulted  Advance was  originally  required to have
been made pursuant to Section 2.01,  even if the other Advances  comprising such
Borrowing  shall be  Eurocurrency  Rate Advances or Bankers'  Acceptances on the
date such Advance is deemed to be made  pursuant to this  subsection  (a).  Each
Borrower  shall  notify  the  Administrative  Agent  at any time  such  Borrower
exercises  its right of set-off  pursuant to this  subsection  (a) and shall set
forth in such  notice (A) the name of the  Defaulting  Lender and the  Defaulted
Advance required to be made by such Defaulting Lender and (B) the amount set off
and  otherwise  applied in respect of such  Defaulted  Advance  pursuant to this
subsection (a). Any portion of such payment otherwise required to be made by any
Borrower to or for the account of such  Defaulting  Lender which is paid by such
Borrower,  after giving  effect to the amount set off and  otherwise  applied by
such  Borrower  pursuant  to  this  subsection  (a),  shall  be  applied  by the
Administrative Agent as specified in subsection (b) or (c) of this Section 2.17.

                  (b) In the event that,  at any one time,  (i) any Lender Party
shall be a Defaulting Lender,  (ii) such Defaulting Lender shall owe a Defaulted
Amount to any Agent or any of the other  Lender  Parties and (iii) any  Borrower
shall  make any  payment  hereunder  or under any  other  Loan  Document  to the
Administrative  Agent  for the  account  of such  Defaulting  Lender,  then  the
Administrative  Agent may,  on its  behalf or on behalf of such other  Agents or
such other Lender Parties and to the fullest extent permitted by applicable law,
apply at such time the amount so paid by such  Borrower to or for the account of
such  Defaulting  Lender to the  payment  of each such  Defaulted  Amount to the
extent  required  to  pay  such  Defaulted   Amount.   In  the  event  that  the
Administrative  Agent  shall so apply any such amount to the payment of any such
Defaulted Amount on any date, the amount so applied by the Administrative  Agent
shall constitute for all purposes of this Agreement and the other Loan Documents
payment,  to such extent, of such Defaulted Amount on such date. Any such amount
so applied by the Administrative Agent shall



<PAGE>   82


                                       76

be retained by the  Administrative  Agent or distributed  by the  Administrative
Agent to such other Agents or such other Lender  Parties,  ratably in accordance
with the respective  portions of such Defaulted  Amounts payable at such time to
the  Administrative  Agent, such other Agents and such other Lender Parties and,
if the amount of such payment made by the applicable Borrower shall at such time
be  insufficient  to pay  all  Defaulted  Amounts  owing  at  such  time  to the
Administrative  Agent,  such other Agents and such other Lender Parties,  in the
following order of priority:

                  (i) first, to the Agents for any Defaulted  Amounts then owing
         to the Agents,  ratably in accordance  with such  respective  Defaulted
         Amounts then owing to the Agents;

                  (ii) second,  to the Issuing Banks and the Swing Line Bank for
         any Defaulted  Amounts then owing to them, in their capacities as such,
         ratably in accordance with such respective Defaulted Amounts then owing
         to such Issuing Banks and such Swing Line Bank; and

                  (iii)  third,  to any other Lender  Parties for any  Defaulted
         Amounts then owing to such other Lender Parties,  ratably in accordance
         with such respective  Defaulted Amounts then owing to such other Lender
         Parties.

Any portion of such amount paid by the  applicable  Borrower  for the account of
such Defaulting Lender  remaining,  after giving effect to the amount applied by
the  Administrative  Agent pursuant to this  subsection (b), shall be applied by
the Administrative Agent as specified in subsection (c) of this Section 2.17.

                  (c) In the event that,  at any one time,  (i) any Lender Party
shall be a  Defaulting  Lender,  (ii)  such  Defaulting  Lender  shall not owe a
Defaulted Advance or a Defaulted Amount and (iii) any Borrower, any Agent or any
other Lender Party shall be required to pay or distribute  any amount  hereunder
or under  any other  Loan  Document  to or for the  account  of such  Defaulting
Lender,  then such  Borrower or such Agent or such other  Lender Party shall pay
such amount to the Administrative Agent to be held by the Administrative  Agent,
to  the  fullest  extent   permitted  by  applicable   law,  in  escrow  or  the
Administrative  Agent shall, to the fullest extent  permitted by applicable law,
hold  in  escrow  such  amount  otherwise  held  by it.  Any  funds  held by the
Administrative  Agent in escrow under this  subsection (c) shall be deposited by
the Administrative Agent in an account with Citibank,  in the name and under the
control of the  Administrative  Agent,  but  subject to the  provisions  of this
subsection  (c). The terms  applicable  to such  account,  including the rate of
interest payable with respect to the credit balance of such account from time to
time,  shall  be  Citibank's   standard  terms  applicable  to  escrow  accounts
maintained  with it. Any  interest  credited to such  account  from time to time
shall be held by the  Administrative  Agent in escrow under,  and applied by the
Administrative  Agent from time to time in accordance  with the  provisions  of,
this  subsection  (c). The  Administrative  Agent shall,  to the fullest  extent
permitted by applicable law, apply all funds so held in escrow from time to time
to



<PAGE>   83


                                       77

the extent necessary to make any Advances required to be made by such Defaulting
Lender and to pay any amount  payable by such  Defaulting  Lender  hereunder and
under the other Loan Documents to the  Administrative  Agent or any other Lender
Party, as and when such Advances or amounts are required to be made or paid and,
if the amount so held in escrow  shall at any time be  insufficient  to make and
pay all such  Advances and amounts  required to be made or paid at such time, in
the following order of priority:

                  (i) first,  to the Agents for any amounts then due and payable
         by  such  Defaulting  Lender  to  the  Agents  hereunder,   ratably  in
         accordance with such amounts then due and payable to the Agents;

                  (ii) second,  to the Issuing Banks and the Swing Line Bank for
         any amounts then due and payable to them hereunder, in their capacities
         as such, by such  Defaulting  Lender,  ratably in accordance  with such
         amounts then due and payable to such Issuing  Banks and such Swing Line
         Bank;

                  (iii) third,  to any other Lender  Parties for any amount then
         due and payable by such Defaulting  Lender to such other Lender Parties
         hereunder,  ratably in accordance with such respective amounts then due
         and payable to such other Lender Parties; and

                  (iv) fourth,  to the applicable  Borrower for any Advance then
         required to be made by such Defaulting  Lender pursuant to a Commitment
         of such Defaulting Lender.

In the event that any Lender Party that is a  Defaulting  Lender  shall,  at any
time,  cease to be a  Defaulting  Lender,  any funds held by the  Administrative
Agent in  escrow  at such  time  with  respect  to such  Lender  Party  shall be
distributed by the Administrative Agent to such Lender Party and applied by such
Lender  Party to the  Obligations  owing to such Lender Party at such time under
this  Agreement  and the other Loan  Documents  ratably in  accordance  with the
respective amounts of such Obligations outstanding at such time.

                  (d) The rights and remedies against a Defaulting  Lender under
this Section 2.17 are in addition to other rights and remedies that any Borrower
may have against such  Defaulting  Lender with respect to any Defaulted  Advance
and that any Agent or any Lender Party may have against such  Defaulting  Lender
with respect to any Defaulted Amount.





<PAGE>   84


                                       78

                                   ARTICLE III

                            CONDITIONS OF LENDING AND
                         ISSUANCES OF LETTERS OF CREDIT

                  SECTION  3.01.  Conditions  Precedent to Initial  Extension of
Credit.  The obligation of each Lender to make an Advance to any Borrower (other
than Danmark) or of any Issuing Bank to issue a Letter of Credit on the occasion
of the Initial  Extension of Credit  hereunder is subject to the satisfaction of
the  following  conditions  precedent  before or  concurrently  with the Initial
Extension of Credit:

                  (a) The Administrative  Agent shall have received on or before
         the day of the Initial  Extension of Credit the  following,  each dated
         such  day  (unless   otherwise   specified),   in  form  and  substance
         satisfactory to the Administrative  Agent (unless otherwise  specified)
         and (except for the Notes) in sufficient copies for each Lender Party:

                           (i) The Notes  (other than the Notes made by Danmark)
                  payable to the order of the Lenders.

                           (ii) A security  agreement in substantially  the form
                  of  Exhibit  D  hereto  (together  with  each  other  security
                  agreement and security agreement supplement delivered pursuant
                  to Section  5.01(j),  in each case as amended,  the  "Security
                  Agreement"), duly executed by each Loan Party, together with:

                                    (A)  certificates  representing  the Pledged
                           Shares  referred  to therein  accompanied  by undated
                           stock  powers   executed  in  blank  and  instruments
                           evidencing the Pledged Debt indorsed in blank,

                                    (B) acknowledgment copies or stamped receipt
                           copies of proper financing statements,  duly filed on
                           or before the day of the Initial  Extension of Credit
                           under   the   Uniform    Commercial   Code   of   all
                           jurisdictions that the Administrative  Agent may deem
                           necessary  or  desirable  in  order  to  perfect  and
                           protect  the  first   priority   liens  and  security
                           interests  created  under  the  Security   Agreement,
                           covering  the  Collateral  described  in the Security
                           Agreement,

                                    (C)  completed   requests  for  information,
                           dated on or before the date of the Initial  Extension
                           of Credit,  listing the financing statements referred
                           to in  clause  (B)  above  and  all  other  effective
                           financing   statements  filed  in  the  jurisdictions
                           referred  to in clause  (B) above  that name any Loan
                           Party as debtor,  together  with copies of such other
                           financing statements,



<PAGE>   85


                                       79

                                    (D) evidence of the  completion of all other
                           recordings  and  filings  of or with  respect  to the
                           Security Agreement that the Administrative  Agent may
                           deem  necessary  or desirable in order to perfect and
                           protect the Liens created thereby,

                                    (E)  evidence of the  insurance  required by
                           the terms of the Security Agreement,

                                    (F)  copies  of  the   Assigned   Agreements
                           referred to in the Security Agreement,  together with
                           a consent to such assignment,  in  substantially  the
                           form of  Exhibit B to the  Security  Agreement,  duly
                           executed  by each party to such  Assigned  Agreements
                           other than the Loan Parties,

                                    (G) the Pledged Account Letters  referred to
                           in the  Security  Agreement,  duly  executed  by each
                           Pledged  Account  Bank  referred  to in the  Security
                           Agreement, and

                                    (H) evidence  that all other action that the
                           Administrative  Agent may deem necessary or desirable
                           in order to perfect and  protect  the first  priority
                           liens  and  security   interests  created  under  the
                           Security Agreement has been taken (including, without
                           limitation,  receipt of duly executed payoff letters,
                           UCC-3  termination   statements  and  landlords'  and
                           bailees' waiver and consent agreements).

                           (iii) A guaranty in substantially the form of Exhibit
                  E hereto  (together  with each  other  guaranty  and  guaranty
                  supplement  delivered  by a Domestic  Subsidiary  pursuant  to
                  Section  5.01(j),  in each  case  as  amended,  the  "Domestic
                  Subsidiary   Guaranty"),   duly   executed  by  each  Domestic
                  Subsidiary  Guarantor and a guaranty in substantially the form
                  of Exhibit F hereto  (together  with each other  guaranty  and
                  guaranty supplement delivered by a Foreign Subsidiary pursuant
                  to Section  5.01(j),  in each case as  amended,  the  "Foreign
                  Subsidiary Guaranty") duly executed by each Foreign Subsidiary
                  Guarantor.

                           (iv) Deeds of trust,  trust  deeds and  mortgages  in
                  substantially  the form of Exhibit G hereto and  covering  the
                  properties  designated  by  an  asterisk  (*)  and  listed  on
                  Schedule  4.01(w)  hereto  (together  with the  Assignments of
                  Leases and Rents  referred to therein and each other  mortgage
                  delivered  pursuant  to  Section  5.01(j),  in  each  case  as
                  amended,  the  "Mortgages"),  duly executed by the appropriate
                  Loan Party, together with:




<PAGE>   86


                                       80

                                    (A)  evidence  that   counterparts   of  the
                           Mortgages  have been duly  recorded or delivered  for
                           recording to the Company's title company on or before
                           the day of the  Initial  Extension  of  Credit in all
                           filing or recording  offices that the  Administrative
                           Agent may deem  necessary  or  desirable  in order to
                           create  a  valid  first  and  subsisting  Lien on the
                           property described therein in favor of the Collateral
                           Agent for the benefit of the Secured Parties and that
                           all  filing  and  recording  taxes and fees have been
                           paid,

                                    (B)   fully   paid   American   Land   Title
                           Association    Lender's    Extended    Coverage   (or
                           equivalent)  title insurance  policies (the "Mortgage
                           Policies") in form and substance,  with  endorsements
                           and in amount acceptable to the Administrative  Agent
                           (which  amount  shall not exceed  the  greater of the
                           amount  of the Lien or the fair  market  value of the
                           property,  issued,  coinsured  and reinsured by title
                           insurers  acceptable  to  the  Administrative  Agent,
                           insuring   the   Mortgages  to  be  valid  first  and
                           subsisting Liens on the property  described  therein,
                           free and clear of all  material  defects  (including,
                           but not  limited  to,  mechanics'  and  materialmen's
                           Liens) and  encumbrances,  excepting  only  Permitted
                           Encumbrances,    and   providing   for   such   other
                           affirmative  insurance  (including  endorsements  for
                           future  advances  under  the Loan  Documents  and for
                           mechanics'   and   materialmen's   Liens)   and  such
                           coinsurance  and  direct  access  reinsurance  as the
                           Administrative Agent may deem necessary or desirable,

                                    (C) the  Assignments  of  Leases  and  Rents
                           referred to in the  Mortgages,  duly  executed by the
                           appropriate Loan Party,

                                    (D)  evidence of the  insurance  required by
                           the terms of the Mortgages, and

                                    (E) evidence  that all other action that the
                           Administrative  Agent may deem necessary or desirable
                           in order to create valid first and  subsisting  Liens
                           on the property  described in the  Mortgages has been
                           taken.

                           (v) A Canadian  security  agreement in  substantially
                  the  form of  Exhibit  H  hereto  (together  with  each  other
                  Canadian security  agreement and Canadian  security  agreement
                  supplement delivered pursuant to Section 5.01(j), in each case
                  as amended, the "Canadian Security Agreement"),  duly executed
                  by each  Loan  Party  organized  under  the  laws  of  Canada,
                  together with evidence that all action that the Administrative
                  Agent may deem  necessary or desirable in order to perfect and
                  protect  the  first  priority  liens  and  security  interests
                  created under the Canadian Security Agreement has been taken.



<PAGE>   87


                                       81

                           (vi) A deed of charge,  in substantially  the form of
                  Exhibit I-1 (as amended, supplemented or otherwise modified in
                  accordance  with  its  terms,  the  "Deed  of  Charge"),  duly
                  executed by each of Handy & Harman UK Holdings  Limited,  HHEL
                  and Rigby, and a deed of charge over shares,  in substantially
                  the form of Exhibit I-2 (as amended, supplemented or otherwise
                  modified  in  accordance  with its terms,  the "Deed of Charge
                  over Shares"),  duly executed by Handy & Harman International,
                  Ltd.  together  with  evidence  that all  actions  that may be
                  necessary or desirable in order to improve,  maintain, perfect
                  and protect the security intended to be created by or pursuant
                  to the Deed of  Charge  and the Deed of  Charge  over  Shares,
                  respectively, have been taken.

                           (vii)  Certified  copies  of the  resolutions  of the
                  Board of  Directors  of each Loan Party  (other than  Danmark)
                  approving the  transactions  contemplated  by the  Transaction
                  Documents and each  Transaction  Document to which it is or is
                  to be a party, and of all documents evidencing other necessary
                  corporate  action  and  governmental  and  other  third  party
                  approvals   and   consents,   if  any,  with  respect  to  the
                  transactions  contemplated  by the  Transaction  Documents and
                  each Transaction Document to which it is or is to be a party.

                           (viii)  A copy  of a  certificate  of the  applicable
                  regulatory  authority of the  jurisdiction of incorporation of
                  each Loan Party (other than Danmark),  dated  reasonably  near
                  the date of the Initial  Extension of Credit,  certifying  (to
                  the extent  applicable)  (A) as to a true and correct  copy of
                  the charter of such Loan Party and each  amendment  thereto on
                  file in such office and (B) that (1) such  amendments  are the
                  only  amendments to such Loan Party's  charter on file in such
                  office,  (2) such Loan Party has paid all  franchise  taxes to
                  the date of such  certificate  and (C) such Loan Party is duly
                  incorporated  and in good  standing  or  presently  subsisting
                  under the laws of the jurisdiction of its incorporation.

                           (ix)  A  copy  of a  certificate  of  the  applicable
                  regulatory  authority of each jurisdiction  listed on Schedule
                  3.01(a)(ix),  dated  reasonably  near the date of the  Initial
                  Extension of Credit,  stating (to the extent  applicable) that
                  each Loan Party is duly  qualified  and in good  standing as a
                  foreign  corporation  in such  jurisdiction  and has filed all
                  annual  reports  required  to be  filed  to the  date  of such
                  certificate.

                           (x) A  certificate  of each Loan  Party  (other  than
                  Danmark), signed on behalf of such Loan Party by its President
                  or a  Vice  President  and  its  Secretary  or  any  Assistant
                  Secretary,  dated the date of the Initial  Extension of Credit
                  (the statements made in which certificate shall be true on and
                  as of the date of the Initial Extension of Credit), certifying
                  as to (A) the absence of any amendments to



<PAGE>   88


                                       82

                  the  charter  of  such  Loan  Party  since  the  date  of  the
                  certificate referred to in Section  3.01(a)(viii),  (B) a true
                  and correct copy of the bylaws of such Loan Party as in effect
                  on the date on which the  resolutions  referred  to in Section
                  3.01(a)(vii)  were  adopted  and on the  date  of the  Initial
                  Extension  of  Credit,  (C) the  due  incorporation  and  good
                  standing  or  valid   existence   of  such  Loan  Party  as  a
                  corporation  organized  under the laws of the  jurisdiction of
                  its  incorporation,  and the absence of any proceeding for the
                  dissolution or  liquidation of such Loan Party,  (D) the truth
                  of the  representations  and warranties  contained in the Loan
                  Documents  as though made on and as of the date of the Initial
                  Extension of Credit and (E) the absence of any event occurring
                  and  continuing,  or resulting  from the Initial  Extension of
                  Credit, that constitutes a Default.

                           (xi) A  certificate  of the Secretary or an Assistant
                  Secretary of each Loan Party (other than  Danmark)  certifying
                  the names and true  signatures  of the  officers  of such Loan
                  Party authorized to sign each Transaction Document to which it
                  is or is to be a party and the other documents to be delivered
                  hereunder and thereunder.

                           (xii)  Certified   copies  of  each  of  the  Related
                  Documents,  duly  executed by the parties  thereto and in form
                  and substance  satisfactory  to the Lender  Parties,  together
                  with all agreements, instruments and other documents delivered
                  in  connection  therewith  as the  Administrative  Agent shall
                  request.

                           (xiii)  Certificates,  in  substantially  the form of
                  Exhibit J hereto, attesting to the Solvency of each Loan Party
                  before  and  after  giving  effect  to  and  the  transactions
                  contemplated by the Transaction  Documents,  from a Designated
                  Officer of such Loan Party.

                           (xiv) Such financial,  business and other information
                  regarding each Loan Party and its  Subsidiaries  as the Lender
                  Parties shall have requested,  including,  without limitation,
                  information  as  to  possible  contingent   liabilities,   tax
                  matters,   environmental  matters,  obligations  under  Plans,
                  Multiemployer Plans and Welfare Plans,  collective  bargaining
                  agreements  and other  arrangements  with  employees,  audited
                  annual financial  statements dated December 31, 1995, December
                  31, 1996 and December 31, 1997,  interim financial  statements
                  dated as of March 31, 1998, pro forma financial  statements as
                  to  the  Company  as at  June  30,  1998  in the  form  of the
                  forecasts   delivered   pursuant  to  this  clause  (xiv)  and
                  forecasts  prepared by management of the Company,  in form and
                  substance satisfactory to the Lender Parties, giving effect to
                  the  transactions  contemplated by the Transaction  Documents,
                  the  acquisition  of the  Company by WHX  Corporation  and the
                  precious    metals    dividend    contemplated    by   Section
                  5.02(g)(i)(B),  of balance sheets,  



<PAGE>   89


                                       83

                  income  statements and cash flow statements on a monthly basis
                  for the first year following the day of the Initial  Extension
                  of  Credit  and on an annual  basis  for each year  thereafter
                  until the Final Maturity Date.

                           (xv) A letter, in form and substance  satisfactory to
                  the  Administrative  Agent,  from  the  Company  to KPMG  Peat
                  Marwick LLP, its  independent  certified  public  accountants,
                  advising  such  accountants  that the  Agents  and the  Lender
                  Parties  have been  authorized  to exercise  all rights of the
                  Company to require  such  accountants  to disclose any and all
                  financial  statements  and any other  information  of any kind
                  that  they  may  have  with  respect  to the  Company  and its
                  Subsidiaries and directing such accountants to comply with any
                  reasonable  request of any Agent or any Lender  Party for such
                  information.

                           (xvi)  Evidence of  insurance  naming the  Collateral
                  Agent  as   additional   insured  and  loss  payee  with  such
                  responsible and reputable insurance companies or associations,
                  and  in  such   amounts  and  covering   such  risks,   as  is
                  satisfactory to the Lender Parties.

                           (xvii)   A Borrowing Base Certificate.

                           (xviii) A favorable  opinion of Olshan Grundman Frome
                  &  Rosenzweig   LLP,   counsel  for  the  Loan   Parties,   in
                  substantially  the form of  Exhibit  K  hereto  and as to such
                  other matters as any Lender Party  through the  Administrative
                  Agent may reasonably request.

                           (xix) A favorable  opinion of each of the counsel set
                  forth on  Schedule  3.01(a)(xix),  local  counsel  to the Loan
                  Parties  in  each  of the  jurisdictions  set  forth  on  such
                  Schedule, in substantially the form of Exhibit L hereto and as
                  to  such  other  matters  as  any  Lender  Party  through  the
                  Administrative Agent may reasonably request.

                           (xx) A  favorable  opinion of  Shearman  &  Sterling,
                  counsel for the  Administrative  Agent,  in form and substance
                  satisfactory to the Administrative Agent.

                  (b) The Lender  Parties shall be satisfied  with the corporate
         and legal structure and  capitalization  of the Company and each of its
         Subsidiaries  the capital stock of which  Subsidiaries is being pledged
         pursuant to the Loan  Documents,  including the terms and conditions of
         the  charter,  bylaws and each class of capital  stock or other  equity
         interest of the Company and each such  Subsidiary and of each agreement
         or instrument relating to such structure or capitalization.




<PAGE>   90


                                       84

                  (c) The Lender  Parties  shall be satisfied  that all Existing
         Debt, other than Surviving Debt, has been prepaid, redeemed or defeased
         in full or otherwise  satisfied and extinguished and that all Surviving
         Debt  shall be on  terms  and  conditions  satisfactory  to the  Lender
         Parties.

                  (d) Before giving effect to and the transactions  contemplated
         by the  Transaction  Documents,  there shall have  occurred no material
         adverse  change in the business,  condition  (financial or  otherwise),
         operations, performance, properties or prospects of the Company and its
         Subsidiaries taken as a whole since December 31, 1997.

                  (e)  There  shall  exist  no  action,   suit,   investigation,
         litigation  or  proceeding  affecting  any  Loan  Party  or  any of its
         Subsidiaries  pending or  threatened  before  any  court,  governmental
         agency  or  arbitrator  that (i) would be  reasonably  likely to have a
         Material  Adverse  Effect  or (ii)  purports  to affect  the  legality,
         validity  or  enforceability   of  any  Transaction   Document  or  the
         consummation  of  the  transactions  contemplated  by  the  Transaction
         Documents.

                  (f) All  governmental  and third party  consents and approvals
         necessary  in  connection  with the  transactions  contemplated  by the
         Transaction  Documents shall have been obtained (without the imposition
         of any conditions  that are not  acceptable to the Lender  Parties) and
         shall remain in effect;  all applicable  waiting  periods in connection
         with the transactions  contemplated by the Transaction  Documents shall
         have expired without any action being taken by any competent authority,
         and no law or  regulation  shall be  applicable  in the judgment of the
         Lender  Parties,  in each  case that  restrains,  prevents  or  imposes
         materially adverse conditions upon the transactions contemplated by the
         Transaction  Documents  or the  rights  of the  Loan  Parties  or their
         Subsidiaries  freely to transfer or otherwise  dispose of, or to create
         any Lien on, any properties  now owned or hereafter  acquired by any of
         them.

                  (g) The Lender  Parties  shall have  completed a due diligence
         investigation  of the Company and its  Subsidiaries in scope,  and with
         results,  satisfactory  to the Lender  Parties,  and nothing shall have
         come to the attention of the Lender  Parties  during the course of such
         due  diligence   investigation   to  lead  them  to  believe  that  the
         Information  Memorandum  was or has  become  misleading,  incorrect  or
         incomplete in any material respect;  without limiting the generality of
         the foregoing,  the Lender Parties shall have been given such access to
         the management,  records, books of account, contracts and properties of
         the Company and its Subsidiaries as they shall have requested.

                  (h) The Company shall have paid all accrued fees of the Agents
         and  the  Lender  Parties  and  all  accrued  expenses  of  the  Agents
         (including   the   accrued   fees  and   expenses  of  counsel  to  the
         Administrative Agent).



<PAGE>   91


                                       85

                  (i) The Total Leverage Ratio shall not exceed 4.50:1.00.

                  SECTION  3.02.  Conditions  Precedent to Initial  Borrowing by
Danmark.  The  obligation  of each  Multicurrency  Lender to make an  Advance to
Danmark shall be effective on and as of the date (the "Danmark  Effective Date")
on which the Administrative Agent shall have received on or before such date the
following,  each  dated  such  day  (unless  otherwise  specified),  in form and
substance  satisfactory to the Administrative Agent (unless otherwise specified)
and in sufficient copies for each Multicurrency Lender:

                           (i) A Danish security agreement in form and substance
                  reasonably  satisfactory to the Administrative Agent (together
                  with each other Danish security  agreement and Danish security
                  agreement supplement delivered pursuant to Section 5.01(j), in
                  each case as amended, the "Danish Security  Agreement"),  duly
                  executed  by each  Loan  Party  organized  under  the  laws of
                  Denmark,  together  with  evidence  that all  action  that the
                  Administrative  Agent may deem necessary or desirable in order
                  to perfect and protect the first  priority  liens and security
                  interests created under the Danish Security Agreement has been
                  taken.

                           (ii) Certified copies of the resolutions of the Board
                  of   Directors   of   Danmark   approving   the   transactions
                  contemplated by the Transaction Documents and each Transaction
                  Document  to  which  it is or is to be a  party,  and  of  all
                  documents  evidencing  other  necessary  corporate  action and
                  governmental and other third party approvals and consents,  if
                  any,  with  respect to the  transactions  contemplated  by the
                  Transaction  Documents and each Transaction  Document to which
                  it is or is to be a party.

                           (iii)  A copy  of a  certificate  of  the  applicable
                  regulatory  authority of the  jurisdiction of incorporation of
                  Danmark,  dated  reasonably  near the Danmark  Effective Date,
                  certifying  (to the  extent  applicable)  (A) as to a true and
                  correct  copy of the  charter  of such  Loan  Party  and  each
                  amendment  thereto on file in such Secretary's  office and (B)
                  that (1) such  amendments are the only amendments to such Loan
                  Party's  charter on file in such  office,  (2) such Loan Party
                  has paid all franchise  taxes to the date of such  certificate
                  and (C)  such  Loan  Party  is duly  incorporated  and in good
                  standing  or  presently  subsisting  under  the  laws  of  the
                  jurisdiction of its incorporation.

                           (iv) A  certificate  of Danmark,  signed on behalf of
                  such  Loan  Party  by its  President,  a Vice  President  or a
                  director and its  Secretary,  any  Assistant  Secretary or any
                  other  director,   dated  the  Danmark   Effective  Date  (the
                  statements made in which  certificate  shall be true on and as
                  of the  Danmark  Effective  Date),  certifying  as to (A)  the
                  absence of any amendments to the charter of such Loan



<PAGE>   92


                                       86

                  Party since the date of the certificate referred to in Section
                  3.02(iii),  (B) a true and correct  copy of the bylaws of such
                  Loan  Party as in effect on the date on which the  resolutions
                  referred to in Section  3.02(ii)  were adopted and on the date
                  of the initial Advance to Danmark,  (C) the due  incorporation
                  and good  standing or valid  existence of such Loan Party as a
                  corporation  organized  under the laws of the  jurisdiction of
                  its  incorporation,  and the absence of any proceeding for the
                  dissolution or  liquidation of such Loan Party,  (D) the truth
                  of the  representations  and warranties  contained in the Loan
                  Documents  as though made on and as of the  Danmark  Effective
                  and (E) the absence of any event occurring and continuing that
                  constitutes a Default.

                           (v) A  certificate  of the  Secretary or an Assistant
                  Secretary of Danmark  certifying the names and true signatures
                  of the  officers  of such Loan Party  authorized  to sign each
                  Transaction  Document  to which it is or is to be a party  and
                  the other documents to be delivered hereunder and thereunder.

                           (vi) A  favorable  opinion  of  Nielsen  &  Koch  Law
                  Office,  counsel for the Loan Parties in Denmark,  in form and
                  substance reasonably  satisfactory to the Administrative Agent
                  and as to such other  matters as any Lender Party  through the
                  Administrative Agent may reasonably request.

                           (vii) A favorable  opinion of Olshan Grundman Frome &
                  Rosenzweig  LLP,  counsel  for the Loan  Parties,  in form and
                  substance reasonably  satisfactory to the Administrative Agent
                  and as to such other  matters as any Lender Party  through the
                  Administrative Agent may reasonably request.

                  SECTION 3.03. Conditions Precedent to Each Borrowing,  Drawing
and Issuance and Renewal.  The obligation of each Appropriate  Lender to make an
Advance or to  purchase,  accept or renew a Bankers'  Acceptance  (other  than a
Letter of Credit  Advance made by an Issuing Bank or a Revolving  Credit  Lender
pursuant to Section 2.03(c) and a Swing Line Advance made by a Revolving  Credit
Lender pursuant to Section 2.02(b)) on the occasion of each Borrowing (including
the initial  Borrowing),  and the  obligation  of each  Issuing  Bank to issue a
Letter of Credit  (including  the initial  issuance) or renew a Letter of Credit
and the right of the Company to request a Swing Line Borrowing, shall be subject
to the further conditions precedent that on the date of such Borrowing,  Drawing
or issuance or renewal (a) the following  statements  shall be true (and each of
the giving of the applicable Notice of Borrowing,  Notice of Drawing,  Notice of
Swing Line Borrowing, Notice of Issuance or Notice of Renewal and the acceptance
by the  applicable  Borrower of the proceeds of such Borrowing or of such Letter
of  Credit  or  the  renewal  of  such  Letter  of  Credit  shall  constitute  a
representation  and  warranty  by such  Borrower  that  both on the date of such
notice and on the date of such  Borrowing,  Drawing or issuance or renewal  such
statements are true):



<PAGE>   93


                                       87

                  (i) the representations and warranties  contained in each Loan
         Document  are correct on and as of such date,  before and after  giving
         effect to such  Borrowing,  Drawing or  issuance  or renewal and to the
         application of the proceeds therefrom, as though made on and as of such
         date, other than any such  representations or warranties that, by their
         terms,  refer to a specific date other than the date of such Borrowing,
         Drawing or issuance or renewal, in which case as of such specific date;

                  (ii) no  Default  has  occurred  and is  continuing,  or would
         result from such Borrowing,  Drawing or issuance or renewal or from the
         application of the proceeds therefrom;

                  (iii) for each Multicurrency Advance, Revolving Credit Advance
         or Swing  Line  Advance  made by the  Swing  Line Bank or  issuance  or
         renewal  of any  Letter of  Credit,  the sum of the Loan  Values of the
         Eligible  Collateral  exceeds  the  aggregate  principal  amount of the
         Multicurrency  Advances plus Revolving  Credit Advances plus Swing Line
         Advances  plus  Letter of Credit  Advances to be  outstanding  plus the
         aggregate  Available  Amount of all Letters of Credit to be outstanding
         after   giving   effect  to  such   Advance  or  issuance  or  renewal,
         respectively; and

                  (iv) for each  Delayed Draw  Advance,  before and after giving
         effect to such  Borrowing,  the Total  Leverage  Ratio shall not exceed
         4.00:1.00 and the amount of the aggregate  principal amounts of Delayed
         Draw  Borrowings  shall not exceed the amount of Investments  permitted
         under  Section  5.02(f)(viii)  immediately  prior to such  Delayed Draw
         Advance.

and (b) the  Administrative  Agent  shall have  received  such other  approvals,
opinions or documents as any Appropriate Lender through the Administrative Agent
may reasonably request.

                  SECTION 3.04.  Determinations Under Section 3.01. For purposes
of determining  compliance  with the conditions  specified in Section 3.01, each
Lender Party shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or  satisfactory to the Lender Parties unless an
officer  of  the   Administrative   Agent   responsible  for  the   transactions
contemplated  by the Loan Documents  shall have received notice from such Lender
Party prior to the Initial  Extension of Credit specifying its objection thereto
and, if the Initial  Extension  of Credit  consists of a Borrowing or a Drawing,
such Lender Party shall not have made available to the Administrative Agent such
Lender Party's ratable portion of such Borrowing or Drawing.



<PAGE>   94


                                       88

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

                  SECTION 4.01. Representations and Warranties of the Borrowers.
Each Borrower represents and warrants as follows:

                  (a) Each Loan Party and each of its  Subsidiaries  (other than
         Inactive  Subsidiaries)  (i) is a corporation  duly organized,  validly
         existing and in good standing under the laws of the jurisdiction of its
         incorporation, (ii) is duly qualified and in good standing as a foreign
         corporation  in each  other  jurisdiction  in which  it owns or  leases
         property  or in which the  conduct of its  business  requires  it to so
         qualify or be  licensed  except  where the  failure to so qualify or be
         licensed  would not be  reasonably  likely to have a  Material  Adverse
         Effect  and  (iii) has all  requisite  corporate  power  and  authority
         (including,  without limitation, all governmental licenses, permits and
         other  approvals)  to own or lease and  operate its  properties  and to
         carry on its business as now conducted and as proposed to be conducted.
         All of the  outstanding  capital  stock of the Company has been validly
         issued,  is  fully  paid  and   non-assessable  and  is  owned  by  WHX
         Corporation free and clear of all Liens.

                  (b) Set forth on  Schedule  4.01(b)  hereto is a complete  and
         accurate list of all Subsidiaries of each Loan Party, showing as of the
         date  hereof  (as to each  such  Subsidiary)  the  jurisdiction  of its
         incorporation,  the  number of shares of each  class of  capital  stock
         authorized,  and the  number  outstanding,  on the date  hereof and the
         percentage of the outstanding shares of each such class owned (directly
         or  indirectly)  by such Loan Party and the number of shares covered by
         all outstanding options, warrants, rights of conversion or purchase and
         similar rights at the date hereof. All of the outstanding capital stock
         of  all  of  each  Loan  Party's   Subsidiaries  (other  than  Inactive
         Subsidiaries) has been validly issued, is fully paid and non-assessable
         and is owned by such Loan Party or one or more of its Subsidiaries free
         and clear of all  Liens,  except  those  created  under the  Collateral
         Documents.

                  (c) The execution, delivery and performance by each Loan Party
         of each  Transaction  Document to which it is or is to be a party,  and
         the  consummation of the  transactions  contemplated by the Transaction
         Documents,  are within such Loan Party's  corporate  powers,  have been
         duly  authorized  by all  necessary  corporate  action,  and do not (i)
         contravene such Loan Party's  charter or bylaws,  (ii) violate any law,
         rule, regulation  (including,  without limitation,  Regulation X of the
         Board  of  Governors  of the  Federal  Reserve  System),  order,  writ,
         judgment,  injunction,  decree,  determination or award, (iii) conflict
         with or result in the breach of, or  constitute  a default  under,  any
         loan agreement, indenture or mortgage or any material contract, deed of
         trust, lease or other



<PAGE>   95


                                       89

         instrument  binding  on  or  affecting  any  Loan  Party,  any  of  its
         Subsidiaries  or any of their  properties  or (iv) except for the Liens
         created under the Loan Documents,  result in or require the creation or
         imposition of any Lien upon or with respect to any of the properties of
         any Loan Party or any of its Subsidiaries.  No Loan Party or any of its
         Subsidiaries is in violation of any such law, rule, regulation,  order,
         writ, judgment, injunction, decree, determination or award or in breach
         of any such contract,  loan  agreement,  indenture,  mortgage,  deed of
         trust,  lease or other  instrument,  the  violation  or breach of which
         would be reasonably likely to have a Material Adverse Effect.

                  (d) Other than the filings contemplated to be made pursuant to
         Section 3.01, no  authorization  or approval or other action by, and no
         notice to or filing with, any governmental authority or regulatory body
         or any  other  third  party  is  required  for (i)  the due  execution,
         delivery,  recordation,  filing or performance by any Loan Party of any
         Transaction  Document  to which  it is or is to be a party,  or for the
         consummation  of  the  transactions  contemplated  by  the  Transaction
         Documents,  (ii) the grant by any Loan Party of the Liens granted by it
         pursuant  to  the  Collateral   Documents,   (iii)  the  perfection  or
         maintenance  of  the  Liens  created  under  the  Collateral  Documents
         (including the first priority  nature  thereof) or (iv) the exercise by
         any Agent or any Lender Party of its rights under the Loan Documents or
         the remedies in respect of the  Collateral  pursuant to the  Collateral
         Documents.

                  (e)  This  Agreement  has  been,  and each  other  Transaction
         Document when  delivered  hereunder  will have been,  duly executed and
         delivered by each Loan Party party thereto. This Agreement is, and each
         other Transaction Document when delivered hereunder will be, the legal,
         valid  and  binding  obligation  of  each  Loan  Party  party  thereto,
         enforceable  against  such Loan  Party in  accordance  with its  terms,
         except  as such  enforceability  may be  limited  by the  effect of any
         applicable  bankruptcy,  insolvency,   reorganization,   moratorium  or
         similar law affecting creditors' rights generally.

                  (f) There is no action,  suit,  investigation,  litigation  or
         proceeding  affecting  any  Loan  Party  or any  of  its  Subsidiaries,
         including any  Environmental  Action,  pending or threatened before any
         court,  governmental  agency or arbitrator that (i) would be reasonably
         likely to have a Material Adverse Effect or (ii) purports to affect the
         legality, validity or enforceability of any Transaction Document or the
         consummation  of  the  transactions  contemplated  by  the  Transaction
         Documents.

                  (g) The  Consolidated  balance  sheets of the  Company and its
         Subsidiaries  as at December  31,  1997,  and the related  Consolidated
         statements  of income and  Consolidated  statement of cash flows of the
         Company  and  its   Subsidiaries   for  the  fiscal  year  then  ended,
         accompanied by an unqualified opinion of KPMG Peat Marwick, independent
         public accountants,  and the Consolidated balance sheets of the Company
         and its Subsidiaries as



<PAGE>   96


                                       90

         at June 30, 1998, and the related Consolidated statements of income and
         Consolidated   statement   of  cash  flows  of  the   Company  and  its
         Subsidiaries  for  the six  months  then  ended,  duly  certified  by a
         Designated Officer of the Company,  copies of which have been furnished
         to each Lender  Party,  fairly  present,  subject,  in the case of said
         balance  sheet as at June 30, 1998,  and said  statements of income and
         cash  flows  for  the  six  months  then  ended,   to  year-end   audit
         adjustments,  the Consolidated  financial  condition of the Company and
         its  Subsidiaries  as at such  dates and the  Consolidated  results  of
         operations of the Company and its Subsidiaries for the periods ended on
         such  dates,  all in  accordance  with  generally  accepted  accounting
         principles  applied on a consistent basis, and since December 31, 1997,
         there has been no Material Adverse Change.

                  (h) The  Consolidated  pro forma balance sheets of the Company
         and its Subsidiaries as at June 30, 1998, and the related  Consolidated
         pro forma  statements  of income and cash flows of the  Company and its
         Subsidiaries  for the six months then ended,  certified by a Designated
         Officer of the  Company,  copies of which have been  furnished  to each
         Lender  Party,  fairly  present the  Consolidated  pro forma  financial
         condition of the Company and its  Subsidiaries  as at such date and the
         Consolidated  pro forma  results of  operations  of the Company and its
         Subsidiaries  for the period  ended on such date,  in each case  giving
         effect to the transactions  contemplated by the Transaction  Documents,
         the  acquisition  of the Company by WHX  Corporation  and the  precious
         metals  dividend   contemplated  by  Section   5.02(g)(i)(B),   all  in
         accordance with GAAP.

                  (i) The Consolidated  and, as to the five business segments of
         the Company,  consolidating,  forecasted balance sheets,  statements of
         income and statements of cash flows of the Company and its Subsidiaries
         delivered to the Lender  Parties  pursuant to Section  3.01(a)(xiv)  or
         5.03 were prepared in good faith on the basis of the assumptions stated
         therein,  which  assumptions  were  fair  in  light  of the  conditions
         existing at the time of delivery of such forecasts, and represented, at
         the  time of  delivery,  the  Company's  best  estimate  of its  future
         financial performance (it being understood that the Company can give no
         assurance that future  performance will equal the forecasts or that the
         results of operations will not differ substantially therefrom).

                  (j)  Neither  the   Information   Memorandum   nor  any  other
         information,  exhibit or report  furnished  by or on behalf of any Loan
         Party  to  any  Agent  or any  Lender  Party  in  connection  with  the
         negotiation  and  syndication  of the Loan Documents or pursuant to the
         terms  of the  Loan  Documents  contained  any  untrue  statement  of a
         material fact or omitted to state a material fact necessary to make the
         statements made therein not misleading.

                  (k) No Borrower is engaged in the business of extending credit
         for the purpose of purchasing or carrying Margin Stock, and no proceeds
         of any Advance, any Drawing or



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                                       91

         drawings  under any Letter of Credit  will be used to purchase or carry
         any  Margin  Stock or to extend  credit to others  for the  purpose  of
         purchasing or carrying any Margin Stock.

                  (l) Neither any Loan Party nor any of its  Subsidiaries  is an
         "investment  company",  or an "affiliated  person" of, or "promoter" or
         "principal underwriter" for, an "investment company", as such terms are
         defined in the Investment Company Act of 1940, as amended.  Neither the
         making of any Advances,  nor the issuance of any Letters of Credit, nor
         the  application of the proceeds or repayment  thereof by any Borrower,
         nor the  consummation  of the other  transactions  contemplated  by the
         Transaction  Documents,  will violate any  provision of such Act or any
         rule,  regulation or order of the  Securities  and Exchange  Commission
         thereunder.

                  (m)  Neither any Loan Party nor any of its  Subsidiaries  is a
         party to any indenture,  loan or credit agreement or any lease or other
         agreement  or  instrument  or  subject  to  any  charter  or  corporate
         restriction that would be reasonably  likely to have a Material Adverse
         Effect.

                  (n) After giving effect to the filings contemplated to be made
         pursuant to Section 3.01, the Collateral  Documents  create a valid and
         perfected first priority security interest in the Collateral,  securing
         the  payment of the  Secured  Obligations,  and all  filings  and other
         actions  necessary or  desirable  to perfect and protect such  security
         interest  have  been duly  taken.  The Loan  Parties  are the legal and
         beneficial  owners of the Collateral free and clear of any Lien, except
         for the liens and security  interests  created or  permitted  under the
         Loan Documents.

                  (o) Each Loan Party is,  individually  and  together  with its
         Subsidiaries, Solvent.

                  (p) (i) Set forth on Schedule 4.01(p) hereto is a complete and
         accurate list of all Plans, Multiemployer Plans and Welfare Plans.

                  (ii) No ERISA Event has occurred or is reasonably  expected to
         occur with respect to any Plan.

                  (iii)  Schedule B (Actuarial  Information)  to the most recent
         annual  report (Form 5500  Series) for each Plan,  copies of which have
         been filed with the  Internal  Revenue  Service  and  furnished  to the
         Lender  Parties,  is complete  and  accurate  and fairly  presents  the
         funding  status of such  Plan,  and since the date of such  Schedule  B
         there has been no material adverse change in such funding status.




<PAGE>   98


                                       92

                  (iv)  Neither  any Loan  Party  nor any  ERISA  Affiliate  has
         incurred or is reasonably  expected to incur any  Withdrawal  Liability
         exceeding $4,000,000 to any Multiemployer Plan.

                  (v)  Neither any Loan Party nor any ERISA  Affiliate  has been
         notified by the sponsor of a Multiemployer Plan that such Multiemployer
         Plan is in reorganization or has been terminated, within the meaning of
         Title  IV of  ERISA,  and no  such  Multiemployer  Plan  is  reasonably
         expected  to be in  reorganization  or to  be  terminated,  within  the
         meaning of Title IV of ERISA.

                  (q) (i) Except as  otherwise  set forth on Part I of  Schedule
         4.01(q)  hereto,  the  operations and properties of each Loan Party and
         each of its  Subsidiaries  comply  in all  material  respects  with all
         applicable  Environmental  Laws  and  Environmental  Permits,  all past
         non-compliance  with such Environmental Laws and Environmental  Permits
         has  been  resolved  without  ongoing  obligations  or  costs,  and  no
         circumstances  exist  that would be  reasonably  likely to (A) form the
         basis of an  Environmental  Action against any Loan Party or any of its
         Subsidiaries  or any of their  properties  that  could  have a Material
         Adverse  Effect or (B) cause any such  property  to be  subject  to any
         material restrictions on ownership,  occupancy,  use or transferability
         under any Environmental Law.

                  (ii)  Except as  otherwise  set  forth on Part II of  Schedule
         4.01(q) hereto,  none of the properties  currently or formerly owned or
         operated  by any Loan  Party or any of its  Subsidiaries  is  listed or
         proposed  for  listing on the NPL or on the  CERCLIS  or any  analogous
         foreign,  state or  local  list or,  to the best of its  knowledge,  is
         adjacent  to any such  property;  there are no and never  have been any
         underground or aboveground  storage tanks or any surface  impoundments,
         septic tanks,  pits, sumps or lagoons in which Hazardous  Materials are
         being  or  have  been  treated,  stored  or  disposed  on any  property
         currently   owned  or  operated  by  any  Loan  Party  or  any  of  its
         Subsidiaries or, to the best of its knowledge, on any property formerly
         owned or operated by any Loan Party or any of its  Subsidiaries;  there
         is  no  asbestos  or  asbestos-containing   material  on  any  property
         currently   owned  or  operated  by  any  Loan  Party  or  any  of  its
         Subsidiaries;   and  Hazardous   Materials   have  not  been  released,
         discharged or disposed of on any property  currently or formerly  owned
         or  operated  by any Loan Party or any of its  Subsidiaries,  except as
         would not be reasonably  expected to result in a liability in excess of
         $250,000 in any Fiscal Year.

                  (iii)  Except as  otherwise  set forth on Part III of Schedule
         4.01(q) hereto,  neither any Loan Party nor any of its  Subsidiaries is
         undertaking,  and has not completed,  either  individually  or together
         with  other  potentially  responsible  parties,  any  investigation  or
         assessment  or remedial or  response  action  relating to any actual or
         threatened release, discharge or disposal of Hazardous Materials at any
         site,  location or  operation,  either  voluntarily  or pursuant to the
         order of any governmental or regulatory authority or the



<PAGE>   99


                                       93

         requirements  of any  Environmental  Law; and all  Hazardous  Materials
         generated,  used,  treated,  handled or stored at, or transported to or
         from, any property  currently or formerly owned or operated by any Loan
         Party or any of its Subsidiaries  have been disposed of in a manner not
         reasonably  expected to result in liability to any Loan Party or any of
         its  Subsidiaries  that  would  be  material  to the  Company  and  its
         Subsidiaries taken as a whole.

                  (r) (i)  Each  Loan  Party  and each of its  Subsidiaries  and
         Affiliates  has filed,  has caused to be filed or has been  included in
         all tax returns  (Federal,  state,  local and  foreign)  required to be
         filed and has paid all taxes,  together  with  applicable  interest and
         penalties, shown thereon to be due.

                  (ii) Set forth on Schedule  4.01(r)  hereto is a complete  and
         accurate list, as of the date hereof, of each taxable year of each Loan
         Party and each of its  Subsidiaries  and  Affiliates  for which Federal
         income tax returns have been filed and for which the  expiration of the
         applicable  statute of limitations for assessment or collection has not
         occurred by reason of extension or otherwise (an "Open Year").

                  (iii) The aggregate unpaid amount,  as of the date hereof,  of
         adjustments  to the Federal income tax liability of each Loan Party and
         each  of its  Subsidiaries  and  Affiliates  proposed  by the  Internal
         Revenue Service with respect to Open Years does not exceed  $1,000,000.
         No issues have been raised by the Internal  Revenue  Service in respect
         of Open Years that, in the  aggregate,  would be  reasonably  likely to
         have a Material Adverse Effect.

                  (iv) The aggregate  unpaid amount,  as of the date hereof,  of
         adjustments to the state,  local and foreign tax liability of each Loan
         Party and its Subsidiaries and Affiliates  proposed by all state, local
         and  foreign  taxing  authorities  (other  than  amounts  arising  from
         adjustments to Federal income tax returns) does not exceed  $1,000,000.
         No issues  have been  raised by such taxing  authorities  that,  in the
         aggregate,  would  be  reasonably  likely  to have a  Material  Adverse
         Effect.

                  (s) Neither the business nor the  properties of any Loan Party
         or  any of its  Subsidiaries  are  affected  by  any  fire,  explosion,
         accident, strike, lockout or other labor dispute, drought, storm, hail,
         earthquake,  embargo,  act  of  God or of the  public  enemy  or  other
         casualty (whether or not covered by insurance) that would be reasonably
         likely to have a Material Adverse Effect.

                  (t) Set forth on  Schedule  4.01(t)  hereto is a complete  and
         accurate list of all Existing Debt (other than Surviving Debt), showing
         as of the date hereof the obligor and the principal amount  outstanding
         thereunder  other  than  Debt in the  aggregate  principal  amount  not
         exceeding $100,000.



<PAGE>   100


                                       94

                  (u) Set forth on  Schedule  4.01(u)  hereto is a complete  and
         accurate list of all Surviving Debt,  showing as of the date hereof the
         obligor and the principal amount outstanding  thereunder,  the maturity
         date thereof and the amortization  schedule therefor other than Debt in
         the aggregate principal amount not exceeding $100,000.

                  (v) Set forth on  Schedule  4.01(v)  hereto is a complete  and
         accurate  list of all Liens on the property or assets of any Loan Party
         or  any  of  its  Subsidiaries,  showing  as of  the  date  hereof  the
         lienholder  thereof,  the principal  amount of the obligations  secured
         thereby and the  property or assets  subject  thereto  other than Liens
         covering  property  with a fair  market  value  in  the  aggregate  not
         exceeding $100,000.

                  (w) Set forth on  Schedule  4.01(w)  hereto is a complete  and
         accurate  list of all real  property  owned by any Loan Party or any of
         its Subsidiaries (other than Inactive Subsidiaries),  showing as of the
         date hereof the street address,  county or other relevant jurisdiction,
         state and record owner  thereof  other than real  property  with a fair
         market value in the aggregate not exceeding  $100,000.  Each Loan Party
         or such Subsidiary has good,  marketable and insurable fee simple title
         to such real  property,  free and clear of all Liens,  other than Liens
         created or permitted by the Loan Documents.

                  (x) Set forth on  Schedule  4.01(x)  hereto is a complete  and
         accurate list of all leases of real property under which any Loan Party
         or any of its  Subsidiaries  (other than Inactive  Subsidiaries) is the
         lessee,  showing as of the date  hereof the street  address,  county or
         other relevant jurisdiction, state, lessor, lessee, expiration date and
         annual  rental  cost  thereof  other than  leases  with  annual  rental
         payments in the aggregate not  exceeding  $100,000.  Each such lease is
         the  legal,  valid  and  binding  obligation  of  the  lessor  thereof,
         enforceable in accordance with its terms.

                  (y) Set forth on  Schedule  4.01(y)  hereto is a complete  and
         accurate list of all  Investments  held by any Loan Party or any of its
         Subsidiaries  on the date  hereof,  showing  as of the date  hereof the
         amount,  obligor or issuer and  maturity,  if any,  thereof  other than
         Investments  with a fair market value in the  aggregate  not  exceeding
         $100,000.

                  (z) Set forth on  Schedule  4.01(z)  hereto is a complete  and
         accurate list of all patents,  trademarks,  trade names,  service marks
         and copyrights,  and all applications therefor and licenses thereof, of
         each Loan Party or any of its Subsidiaries required in the operation of
         its business,  showing as of the date hereof the  jurisdiction in which
         registered,  the registration  number, the date of registration and the
         expiration date.

                  (aa) The Company has (i) initiated a review and  assessment of
         all  areas  within  its and  each  of its  Subsidiaries'  business  and
         operations  (including those materially affected by suppliers,  vendors
         and customers) that could be materially adversely affected by the



<PAGE>   101


                                       95

         "Year 2000 Problem" (that is, the risk that computer  applications used
         by the Company or any of its  Subsidiaries  may be unable to  recognize
         and perform properly  date-sensitive  functions involving certain dates
         prior  to and  any  date  after  December  31,  1999),  (ii)  used  its
         reasonable  efforts to develop a plan and timeline for  addressing  the
         Year 2000 Problem on a timely basis, and (iii) to date,  implemented in
         all material  respects  that plan in  accordance  with that  timetable.
         Based  on  the  foregoing,  the  Company  believes  that  all  computer
         applications  that are material to its and its  Subsidiaries'  business
         and operations are reasonably  expected on a timely basis to be able to
         perform  properly  date-sensitive  functions  for all dates  before and
         after  January 1, 2000 (that is, be "Year 2000  compliant"),  except to
         the extent that a failure to do so could not  reasonably be expected to
         have Material Adverse Effect.

                                    ARTICLE V

                           COVENANTS OF THE BORROWERS

                  SECTION 5.01. Affirmative Covenants. So long as any Advance or
any other  Obligation  of any Loan Party under any Loan  Document  shall  remain
unpaid, any Letter of Credit or Bankers'  Acceptance shall be outstanding or any
Lender Party shall have any Commitment hereunder, each Borrower will:

                  (a) Compliance with Laws, Etc.  Comply,  and cause each of its
         Subsidiaries to comply with all applicable laws, rules, regulations and
         orders, such compliance to include, without limitation, compliance with
         ERISA and the Racketeer Influenced and Corrupt Organizations Chapter of
         the  Organized  Crime  Control  Act of 1970  except to the  extent  the
         failure to do so could not  reasonably  be  expected to have a Material
         Adverse Effect.

                  (b) Payment of Taxes,  Etc. Pay and discharge,  and cause each
         of its Subsidiaries to pay and discharge,  before the same shall become
         delinquent,  (i) all taxes,  assessments  and  governmental  charges or
         levies  imposed upon it or upon its property and (ii) all lawful claims
         that,  if  unpaid,  might  by law  become  a Lien  upon  its  property;
         provided,   however,   that  neither  such  Borrower  nor  any  of  its
         Subsidiaries  shall be  required  to pay or  discharge  any  such  tax,
         assessment,  charge or claim that (x) is being  contested in good faith
         and by proper  proceedings  and as to which  appropriate  reserves  are
         being  maintained,  unless  and  until  any  Lien  resulting  therefrom
         attaches  to its  property  and becomes  enforceable  against its other
         creditors  or (y) to the extent that the  aggregate  of all such taxes,
         charges or claims do not exceed $100,000.

                  (c) Compliance with Environmental  Laws. (i) Comply, and cause
         each of its Subsidiaries and all lessees and other Persons operating or
         occupying its  properties to comply with all  applicable  Environmental
         Laws and Environmental Permits; obtain and



<PAGE>   102


                                       96

         renew  and  cause  each of its  Subsidiaries  to  obtain  and renew all
         Environmental Permits necessary for its operations and properties;  and
         (ii)  conduct,  and cause  each of its  Subsidiaries  to  conduct,  any
         investigation,  study, sampling and testing, and undertake any cleanup,
         removal,  remedial or other action necessary to remove and clean up all
         Hazardous Materials from any of its properties,  in accordance with the
         requirements of all  Environmental  Laws, except in the case of each of
         the foregoing clauses (i) and (ii) where the failure to do so could not
         reasonably  be expected to have a Material  Adverse  Effect;  provided,
         however,  that neither such Borrower nor any of its Subsidiaries  shall
         be required to undertake any such cleanup,  removal,  remedial or other
         action to the extent that its obligation to do so is being contested in
         good faith and by proper proceedings and appropriate reserves are being
         maintained with respect to such circumstances.

                  (d) Maintenance of Insurance.  Maintain, and cause each of its
         Subsidiaries  to maintain,  insurance  with  responsible  and reputable
         insurance  companies or  associations in such amounts and covering such
         risks as is usually carried by companies engaged in similar  businesses
         and owning  similar  properties in the same general areas in which such
         Borrower or such Subsidiary operates.

                  (e)  Preservation of Corporate  Existence,  Etc.  Preserve and
         maintain,  and cause each of its Subsidiaries to preserve and maintain,
         its  existence,  legal  structure,  legal  name,  rights  (charter  and
         statutory),  permits, licenses,  approvals,  privileges and franchises;
         provided,   however,  that  such  Borrower  and  its  Subsidiaries  may
         consummate any merger or consolidation  permitted under Section 5.02(d)
         and  provided  further  that  neither  any  Borrower  nor  any  of  its
         Subsidiaries shall be required to preserve any right, permit,  license,
         approval,  privilege  or  franchise  if the Board of  Directors of such
         Borrower  or such  Subsidiary  shall  determine  that the  preservation
         thereof is no longer  desirable  in the conduct of the  business of the
         Company and its Subsidiaries taken as a whole and that the loss thereof
         is not  disadvantageous  in any material respect to the Company and its
         Subsidiaries taken as a whole or the Lender Parties.

                  (f) Visitation Rights. At any reasonable time and from time to
         time  with  prior  notice  to  the  Company   (other  than  during  the
         continuance  of a  Default),  permit  any of the  Agents  or any of the
         Lender Parties,  or any agents or representatives  thereof,  to examine
         and make copies of and abstracts  from the records and books of account
         of,  and  visit  the  properties  of,  such  Borrower  and  any  of its
         Subsidiaries, and to discuss the affairs, finances and accounts of such
         Borrower  and any of its  Subsidiaries  with any of their  officers  or
         directors and with their independent certified public accountants.

                  (g) Keeping of Books. Keep, and cause each of its Subsidiaries
         to keep, proper books of record and account,  in which full and correct
         entries shall be made of all financial  transactions and the assets and
         business of such Borrower and each such



<PAGE>   103


                                       97

         Subsidiary in accordance with generally accepted accounting  principles
         in effect from time to time.

                  (h) Maintenance of Properties, Etc. Maintain and preserve, and
         cause each of its  Subsidiaries  to maintain and  preserve,  all of its
         material  properties that are then used or useful in the conduct of its
         business in good working  order and  condition,  ordinary wear and tear
         excepted.

                  (i) Transactions with Affiliates.  Conduct,  and cause each of
         its Subsidiaries to conduct, all transactions otherwise permitted under
         the Loan Documents with any of their  Affiliates on terms that are fair
         and  reasonable  and  no  less  favorable  to  such  Borrower  or  such
         Subsidiary   than  it  would  obtain  in  a   comparable   arm's-length
         transaction  with a Person not an Affiliate  except that, so long as no
         Default  shall  have  occurred  and be  continuing  at the  time of any
         payment described below or would result therefrom:

                           (i) the Company may pay management fees to WHX or its
                  Affiliates  not in excess of  $1,000,000 in any Fiscal Year in
                  accordance with the Management Agreement,

                           (ii)  the  Company  and  its  Subsidiaries  may  make
                  payments in accordance  with the Tax  Agreement  provided that
                  both  before  and after  giving  effect to such  payments  the
                  Senior Leverage Ratio shall not be greater than 4.50:1.00,

                           (iii) the Company and its  Subsidiaries  may pay fees
                  to their respective directors,

                           (iv) the Company and its  Subsidiaries  may each make
                  pension  plan  contribution   payments  in  respect  of  their
                  proportionate  share of the cost of such  contributions  under
                  the relevant plans,

                           (v) the Company may pay dividends to WHX  Corporation
                  or its wholly-owned Subsidiaries permitted by Section 5.02(g),

                           (vi) the  Company  and its  Subsidiaries  may  prepay
                  Subordinated Debt as permitted by section 5.02(k), and

                           (vii)  other  transactions  with  Affiliates  to  the
                  extent not  included in (i) through (vi) above  provided  that
                  the amounts  payable by the Loan  Parties in  connection  with
                  such transactions shall not in the aggregate exceed $1,000,000
                  in any Fiscal Year.



<PAGE>   104


                                       98


                  (j) Covenant to Guarantee Obligations and Give Security.  Upon
         (x) the request of the  Collateral  Agent  following the occurrence and
         during the  continuance of a Default,  (y) the formation or acquisition
         of any new direct or indirect Subsidiaries by any Loan Party other than
         an  Inactive   Subsidiary  or  (z)  the  acquisition  of  any  property
         (including,  without limitation, any interest in joint ventures) by any
         Loan Party, other than property that, in the judgment of the Collateral
         Agent,  shall not be  material  or shall not  already  be  subject to a
         perfected first priority  security  interest in favor of the Collateral
         Agent for the benefit of the Secured Parties, then such Borrower shall,
         in each case at such Borrower's expense:

                           (i) in connection  with the formation or  acquisition
                  of a Subsidiary other than an Inactive  Subsidiary,  within 10
                  days  after such  formation  or  acquisition,  cause each such
                  Subsidiary,  and cause each direct and indirect parent of such
                  Subsidiary  (if it has not already  done so), to duly  execute
                  and  deliver to the  Collateral  Agent a guaranty  or guaranty
                  supplement,   in  form  and  substance   satisfactory  to  the
                  Collateral Agent, guaranteeing the other Loan Parties' (in the
                  case of the formation or acquisition of a Domestic Subsidiary)
                  or the Foreign (other than any such  liabilities in respect of
                  renewals or  replacements of existing leases in amounts not in
                  excess of those payable under existing leases)  Borrowers' and
                  Foreign  Subsidiaries'  (in  the  case  of  the  formation  or
                  acquisition  of a Foreign  Subsidiary)  obligations  under the
                  Loan Documents,

                           (ii) within 10 days after such request,  formation or
                  acquisition,  furnish to the Collateral Agent a description of
                  the real and personal properties of the Loan Parties and their
                  respective   Subsidiaries   in  detail   satisfactory  to  the
                  Collateral Agent,

                           (iii) within 15 days after such request, formation or
                  acquisition,  duly  execute and  deliver,  and cause each such
                  Subsidiary  and  each  direct  and  indirect  parent  of  such
                  Subsidiary (if it has not already done so) to duly execute and
                  deliver,   to  the  Collateral   Agent   mortgages,   pledges,
                  assignments, security agreement supplements and other security
                  agreements,   as  specified  by  and  in  form  and  substance
                  satisfactory to the Collateral Agent,  securing payment of all
                  the Obligations of the applicable Loan Party,  such Subsidiary
                  or such parent,  as the case may be, under the Loan  Documents
                  and constituting Liens on all such properties,

                           (iv) within 30 days after such request,  formation or
                  acquisition, take, and cause such Subsidiary or such parent to
                  take,  whatever action  (including,  without  limitation,  the
                  recording of mortgages, the filing of Uniform Commercial



<PAGE>   105


                                       99

                  Code  financing  statements,  the  giving of  notices  and the
                  endorsement of notices on title documents) may be necessary or
                  advisable  in the opinion of the  Collateral  Agent to vest in
                  the  Collateral  Agent  (or  in  any   representative  of  the
                  Collateral  Agent designated by it) valid and subsisting Liens
                  on the  properties  purported to be subject to the  mortgages,
                  pledges,  assignments,   security  agreement  supplements  and
                  security   agreements   delivered  pursuant  to  this  Section
                  5.01(j),  enforceable  against all third parties in accordance
                  with their terms,

                           (v) within 60 days after such  request,  formation or
                  acquisition, deliver to the Collateral Agent, upon the request
                  of the Collateral Agent in its sole discretion,  a signed copy
                  of a favorable opinion,  addressed to the Collateral Agent and
                  the other  Secured  Parties,  of counsel for the Loan  Parties
                  acceptable to the Collateral Agent as to the matters contained
                  in clauses (i), (iii) and (iv) above,  as to such  guaranties,
                  guaranty   supplements,   mortgages,   pledges,   assignments,
                  security agreement  supplements and security  agreements being
                  legal, valid and binding  obligations of each Loan Party party
                  thereto  enforceable in accordance with their terms, as to the
                  matters contained in clause (iv) above, as to such recordings,
                  filings,   notices,   endorsements  and  other  actions  being
                  sufficient to create valid perfected Liens on such properties,
                  and as to such  other  matters  as the  Collateral  Agent  may
                  reasonably request,

                           (vi) as promptly as  practicable  after such request,
                  formation  or  acquisition,  deliver,  upon the request of the
                  Collateral  Agent in its sole  discretion,  to the  Collateral
                  Agent with  respect to each parcel of real  property  owned or
                  held by the  entity  that  is the  subject  of  such  request,
                  formation  or   acquisition,   such  title  reports,   as  the
                  Collateral  Agent may request,  in scope,  form and  substance
                  satisfactory to the Collateral Agent, provided,  however, that
                  to the extent  that any Loan Party or any of its  Subsidiaries
                  shall have  otherwise  received  title  reports,  surveys  and
                  engineering,   soils  and  other  reports,  and  environmental
                  assessment  reports with respect to such real  property,  such
                  items shall,  promptly after the receipt thereof, be delivered
                  to the Collateral Agent,

                           (vii) upon the occurrence and during the  continuance
                  of a Default,  promptly cause to be deposited any and all cash
                  dividends  paid or  payable  to it or any of its  Subsidiaries
                  from any of its  Subsidiaries  from time to time into the Cash
                  Collateral  Account,  and with respect to all other  dividends
                  paid or payable to it or any of its Subsidiaries  from time to
                  time,  promptly execute and deliver,  or cause such Subsidiary
                  to promptly  execute and deliver,  as the case may be, any and
                  all further  instruments  and take or cause such Subsidiary to
                  take,  as the  case  may be,  all  such  other  action  as the
                  Collateral  Agent may deem  necessary or desirable in order to
                  obtain and maintain  from and after the time such  dividend is
                  paid or



<PAGE>   106


                                       100

                  payable  a  perfected,  first  priority  lien on and  security
                  interest in such dividends, and

                           (viii)  at any time and from  time to time,  promptly
                  execute  and  deliver  any and  all  further  instruments  and
                  documents  and take all such  other  action as the  Collateral
                  Agent may  reasonably  deem  necessary in  obtaining  the full
                  benefits of, or in  perfecting  and  preserving  the Liens of,
                  such guaranties,  mortgages,  pledges,  assignments,  security
                  agreement supplements and security agreements.

                  (k)  Further  Assurances.  (i)  Promptly  upon  request by any
         Agent, or any Lender Party through the Administrative  Agent,  correct,
         and cause each of its  Subsidiaries  promptly to correct,  any material
         defect or error that may be  discovered  in any Loan Document or in the
         execution, acknowledgment, filing or recordation thereof, and

                  (ii)  Promptly  upon  request  by the  Collateral  Agent,  do,
         execute,  acknowledge,   deliver,  record,  re-record,  file,  re-file,
         register  and  re-register  any  and  all  such  further  acts,  deeds,
         conveyances, pledge agreements, mortgages, deeds of trust, trust deeds,
         assignments,    financing   statements   and   continuations   thereof,
         termination statements, notices of assignment, transfers, certificates,
         assurances and other instruments as the Collateral Agent may reasonably
         require  from time to time in order to (A)  carry out more  effectively
         the purposes of the Loan Documents, (B) to the fullest extent permitted
         by applicable law, subject any Loan Party's or any of its Subsidiaries'
         properties,  assets,  rights or interests to the Liens now or hereafter
         intended to be covered by any of the Collateral Documents,  (C) perfect
         and maintain  the  validity,  effectiveness  and priority of any of the
         Collateral  Documents  and  any of the  Liens  intended  to be  created
         thereunder and (D) assure, convey, grant, assign,  transfer,  preserve,
         protect  and confirm  more  effectively  unto the  Secured  Parties the
         rights  granted  or now or  hereafter  intended  to be  granted  to the
         Secured  Parties under any Loan Document or under any other  instrument
         executed in  connection  with any Loan Document to which any Loan Party
         or any of its  Subsidiaries  is or is to be a party,  and cause each of
         its Subsidiaries to do so.

                  (l) Performance of Related Documents. Perform and observe, and
         cause each of its Subsidiaries to perform and observe, all of the terms
         and provisions of each Related  Document to be performed or observed by
         it,  maintain  each such  Related  Document  in full force and  effect,
         enforce such Related  Document in accordance  with its terms,  take all
         such  action to such end as may be from time to time  requested  by the
         Administrative  Agent and,  upon request of the  Administrative  Agent,
         make to each other party to each such Related Document such demands and
         requests for information and reports or for action as any Loan Party or
         any  of its  Subsidiaries  is  entitled  to  make  under  such  Related
         Document.




<PAGE>   107


                                       101

                  (m) Preparation of  Environmental  Reports.  At the request of
         the  Administrative  Agent or the  Collateral  Agent  from time to time
         after the occurrence and during the  continuance of a Default,  provide
         to the Lender Parties within 60 days after such request, at the expense
         of the Company,  an environmental site assessment report for any of its
         or its Subsidiaries' properties described in such request,  prepared by
         an environmental consulting firm acceptable to the Administrative Agent
         or  the  Collateral  Agent,  indicating  the  presence  or  absence  of
         Hazardous  Materials and the estimated cost of any compliance,  removal
         or remedial action in connection  with any Hazardous  Materials on such
         properties;  without  limiting the generality of the foregoing,  if the
         Administrative Agent or the Collateral Agent determine at any time that
         a material risk exists that any such report will not be provided within
         the time referred to above, the Administrative  Agent or the Collateral
         Agent may  retain an  environmental  consulting  firm to  prepare  such
         report at the expense of the Company, and the Company hereby grants and
         agrees to cause any Subsidiary that owns any property described in such
         request to grant at the time of such request to the Agents,  the Lender
         Parties,  such  firm  and any  agents  or  representatives  thereof  an
         irrevocable non-exclusive license, subject to the rights of tenants, to
         enter onto their respective properties to undertake such an assessment.

                  (n) Compliance with Terms of Leaseholds. Make all payments and
         otherwise  perform  all  obligations  in  respect of all leases of real
         property to which such Borrower or any of its  Subsidiaries is a party,
         keep such  leases in full force and effect and not allow such leases to
         lapse or be  terminated  or any  rights  to  renew  such  leases  to be
         forfeited or canceled,  notify the Administrative  Agent of any default
         by any  party  with  respect  to such  leases  and  cooperate  with the
         Administrative  Agent in all  respects  to cure any such  default,  and
         cause each of its Subsidiaries to do so, except, in any case, where the
         failure to do so, either individually or in the aggregate, would not be
         reasonably likely to have a Material Adverse Effect.

                  (o) Cash Concentration  Accounts.  Maintain, and cause each of
         its Subsidiaries to maintain, main cash concentration accounts with The
         Bank of New  York or one or more  banks  acceptable  to the  Collateral
         Agent  that  have  accepted  the  assignment  of such  accounts  to the
         Collateral Agent for the benefit of the Secured Parties pursuant to the
         Security Agreement.

                  (p) Interest Rate  Hedging.  Enter into prior to September 30,
         1998,  and  maintain  at all  times  thereafter,  interest  rate  Hedge
         Agreements  with  Persons  acceptable  to  the  Administrative   Agent,
         covering a notional amount of not less than  $125,000,000 and providing
         for such Persons to make  payments  thereunder  for a period of no less
         than three years to the extent of increases in interest  rates based on
         greater  than 1.5% above the  weighted  average  Eurocurrency  Rate for
         $1,000,000 for an Interest Period of three months on the date thereof.



<PAGE>   108


                                       102

                  (q) Conditions  Subsequent.  (i) Deliver to the Administrative
         Agent on or before  September 30, 1998 American Land Title  Association
         form surveys,  dated no more than 30 days before the day of the Initial
         Extension  of Credit,  certified  to the  Administrative  Agent and the
         issuer of the Mortgage Policies  described in Section  3.01(a)(iv) in a
         manner satisfactory to the Administrative Agent by a land surveyor duly
         registered  and licensed in the States in which the property  described
         in such surveys is located and acceptable to the Administrative  Agent,
         showing   all   buildings   and  other   improvements,   any   off-site
         improvements,  the location of any easements, parking spaces, rights of
         way, building set-back lines and other dimensional  regulations and the
         absence of  encroachments,  either by such  improvements  or on to such
         property, and other defects, other than encroachments and other defects
         acceptable to the Administrative Agent.

                           (ii) Deliver to the Administrative Agent on or before
         August 31, 1998 the Pledged Account Letters referred to in the Security
         Agreement, duly executed by the Pledged Account Bank referred to in the
         Security Agreement or, if the Company is unable to deliver such Pledged
         Account Letter on or before August 31, 1998, on or before  November 30,
         1998, transfer the Pledged Account to another financial institution and
         deliver to the Administrative  Agent a Pledged Account Letter from such
         other financial institution.

                           (iii)  Deliver  to  the  Administrative  Agent  on or
         before  August 31, 1998 evidence  that the Articles of  Association  of
         HHEL, Rigby and Handy & Harman UK Holdings Limited have been amended in
         a  manner  satisfactory  to the  Administrative  Agent  and  that  such
         amendments  have been filed with the  Registrar of Companies in England
         and Wales.

                           (iv) Deliver to the Administrative Agent on or before
         September 30, 1998 a Schedule setting forth the book and estimated fair
         value of each parcel of real property listed on Schedule 4.01(w).

                           (v)  Deliver  to the  Administrative  Agent (A) on or
         before  August 31, 1998 (1) evidence  that the precious  metals and the
         commodity  contracts have been deposited into separate  accounts at one
         or more securities  intermediary and (2) a copy of a securities account
         notification  and control  agreement and a copy of a commodity  account
         notification  and  control  agreement,   each  in  form  and  substance
         reasonably  satisfactory  to the  Administrative  Agent and executed by
         Merrill  Lynch  or  (B)  if the  Company  is  unable  to  deliver  such
         agreements on or before August 31, 1998,  deliver to the Administrative
         Agent on or before  October 31, 1998 evidence that the precious  metals
         and  the  commodities   contracts  have  been  transferred  to  another
         securities  intermediary  and a  securities  account  notification  and
         control agreement and a commodity account



<PAGE>   109


                                       103

         notification  and control  agreement in form and  substance  reasonably
         satisfactory  to the  Administrative  Agent and  executed by such other
         securities intermediary.

                  SECTION 5.02.  Negative  Covenants.  So long as any Advance or
any other  Obligation  of any Loan Party under any Loan  Document  shall  remain
unpaid, any Letter of Credit or Bankers'  Acceptance shall be outstanding or any
Lender Party shall have any Commitment hereunder, no Borrower will, at any time:

                  (a) Liens, Etc. Create,  incur,  assume or suffer to exist, or
         permit any of its  Subsidiaries to create,  incur,  assume or suffer to
         exist,  any Lien on or with  respect  to any of its  properties  of any
         character (including,  without limitation,  accounts) whether now owned
         or hereafter  acquired,  or sign or file or suffer to exist,  or permit
         any of its  Subsidiaries to sign or file or suffer to exist,  under the
         Uniform Commercial Code or similar  legislation of any jurisdiction,  a
         financing statement that names such Borrower or any of its Subsidiaries
         as  debtor,  or  sign  or  suffer  to  exist,  or  permit  any  of  its
         Subsidiaries  to  sign or  suffer  to  exist,  any  security  agreement
         authorizing  any  secured  party  thereunder  to  file  such  financing
         statement,  or assign, or permit any of its Subsidiaries to assign, any
         accounts or other right to receive income, except:

                           (i)      Liens created under the Loan Documents;

                           (ii)     Permitted Liens;

                           (iii) Liens existing on the date hereof and described
                  on Schedule 4.01(v) hereto;

                           (iv) purchase money Liens upon or in real property or
                  equipment  acquired  or held by  such  Borrower  or any of its
                  Subsidiaries  in the ordinary course of business to secure the
                  purchase price of such property or equipment or to secure Debt
                  incurred solely for the purpose of financing the  acquisition,
                  construction  or improvement of any such property or equipment
                  to be subject to such  Liens,  or Liens  existing  on any such
                  property or  equipment  at the time of  acquisition  or at the
                  time the Person  owning such  property or  equipment  became a
                  Subsidiary (other than any such Liens created in contemplation
                  of such acquisition that do not secure the purchase price), or
                  extensions,  renewals or  replacements of any of the foregoing
                  for the same or a lesser amount;  provided,  however,  that no
                  such Lien shall extend to or cover any property other than the
                  property or equipment being acquired, constructed or improved,
                  and no such extension,  renewal or replacement shall extend to
                  or cover any  property  not  theretofore  subject  to the Lien
                  being extended, renewed or replaced; and provided further that
                  the  aggregate  principal  amount of the Debt secured by Liens
                  permitted by this



<PAGE>   110


                                       104

                  clause  (iv)  shall not  exceed  the  amount  permitted  under
                  Section 5.02(b)(iii)(B) at any time outstanding;

                           (v) Liens  arising  in  connection  with  Capitalized
                  Leases permitted under Section 5.02(b)(iii)(C);  provided that
                  no such Lien shall extend to or cover any Collateral or assets
                  other than the assets subject to such Capitalized Leases;

                           (vi)  Liens  arising  in  connection  with a Precious
                  Metals Leasing as contemplated by the Intercreditor Agreement;

                           (vii) other Liens  securing  Debt  outstanding  in an
                  aggregate principal amount not to exceed $10,000,000, provided
                  that no such Lien shall extend to or cover any Collateral;

                           (viii) the  replacement,  extension or renewal of any
                  Lien  permitted by clauses  (iii) and (v) above upon or in the
                  same property  theretofore subject thereto or the replacement,
                  extension or renewal (without increase in the amount or change
                  in any  direct  or  contingent  obligor)  of the Debt  secured
                  thereby;

                           (ix) Liens securing the performance of bids, tenders,
                  leases,  contracts  (other than for the  repayment of borrowed
                  currency), statutory obligations,  surety and appeal bonds and
                  other  obligation  of like  nature,  incurred in the  ordinary
                  course of business,  and  judgment  liens not  constituting  a
                  Default under Section 6.01;

                           (x)   Zoning   restrictions,    easements,    waiver,
                  reservations,  restrictions  on the  use of real  property  or
                  minor  irregularities  incident  thereto  which  do not in the
                  aggregate  detract  from  the  value  or use  of any  material
                  property  or  from  the   property  of  the  Company  and  its
                  Subsidiaries taken as a whole; and

                           (xi) Liens incurred in connection  with  transactions
                  of the type  described in clause (d) of the definition of Cash
                  Equivalents in an aggregate amount not to exceed $5,000,000.

                  (b) Debt. Create,  incur, assume or suffer to exist, or permit
         any of its  Subsidiaries to create,  incur,  assume or suffer to exist,
         any Debt, except:

                           (i)      in the case of the Company:

                                    (A)  Debt in  respect  of  Hedge  Agreements
                           designed to hedge  against  fluctuations  in interest
                           rates incurred in the ordinary course of



<PAGE>   111


                                       105

                           business  and   consistent   with  prudent   business
                           practice with the aggregate  notional  amount thereof
                           not to exceed $175,000,000 at any time outstanding;

                                    (B)  Subordinated  Debt maturing at least 12
                           months  later  than the Final  Maturity  Date that is
                           issued:

                                            (1)  to  WHX   Corporation   or  its
                                    Subsidiaries on terms  substantially  as set
                                    forth in Exhibit N hereto  for the  purposes
                                    of permitting the Company to comply with the
                                    financial  covenants  set  forth in  Section
                                    5.04;  provided that such  Subordinated Debt
                                    is incurred prior to the date of delivery of
                                    financial  statements  pursuant  to  Section
                                    5.03(b) or (c)  evidencing any Default under
                                    Section  5.04  and  provided  further,  that
                                    before incurring any such Debt, a Designated
                                    Officer of the Company  shall deliver to the
                                    Administrative     Agent    a    certificate
                                    demonstrating  compliance,  on a  pro  forma
                                    basis after giving effect to the  incurrence
                                    of any such Debt, with all such covenants as
                                    at  the  end of  the  immediately  preceding
                                    fiscal quarter of the Company; or

                                            (2)  to   any   Person   on   terms,
                                    including as to interest and  subordination,
                                    at the time of issuance,  comparable to that
                                    offered in the capital markets  generally to
                                    companies    of    comparable    size    and
                                    creditworthiness;   provided,   that  before
                                    incurring   any  such  Debt,   a  Designated
                                    Officer of the Company  shall deliver to the
                                    Administrative     Agent    a    certificate
                                    demonstrating  compliance,  on a  pro  forma
                                    basis after giving effect to the  incurrence
                                    of any such Debt,  with the Senior  Leverage
                                    Ratio and the Total Leverage Ratio as at the
                                    end  of  the  immediately  preceding  fiscal
                                    quarter of the Company;

                           (ii) in the case of any  Subsidiary  of the  Company,
                  Debt owed to the Company or to a wholly  owned  Subsidiary  of
                  the Company, provided that, in each case, such Debt (x) shall,
                  in the case of Debt owed to a Loan Party,  constitute  Pledged
                  Debt and (y) shall be  evidenced by  promissory  notes in form
                  and substance  satisfactory  to the  Administrative  Agent and
                  such  promissory  notes  shall,  in the case of Debt owed to a
                  Loan Party,  be pledged as security for the Obligations of the
                  holder  thereof under the Loan  Documents to which such holder
                  is a party and delivered to the  Collateral  Agent pursuant to
                  the terms of the Security Agreement; and




<PAGE>   112


                                       106

                           (iii)   in  the   case   of  the   Company   and  its
                  Subsidiaries:

                                    (A)     Debt under the Loan Documents;

                                    (B)  Debt  secured  by  Liens  permitted  by
                           Section  5.02(a)(iv)  not to exceed in the  aggregate
                           $10,000,000 at any time outstanding;

                                    (C) Capitalized  Leases not to exceed in the
                           aggregate $10,000,000 at any time outstanding;

                                    (D)  the  Surviving   Debt,   and  any  Debt
                           extending   the   maturity   of,  or   refunding   or
                           refinancing,  in whole or in part, any Surviving Debt
                           included in Part I of Schedule 4.01(u), provided that
                           the  terms  of  any  such  extending,   refunding  or
                           refinancing  Debt, and of any agreement  entered into
                           and of any instrument issued in connection therewith,
                           are not otherwise  prohibited by the Loan  Documents,
                           provided  further that the  principal  amount of such
                           Surviving  Debt  shall  not be  increased  above  the
                           principal  amount  thereof  outstanding   immediately
                           prior to such  extension,  refunding or  refinancing,
                           and the direct and contingent obligors therefor shall
                           not be changed,  as a result of or in connection with
                           such extension, refunding or refinancing;

                                    (E)  Debt  of  any  Person  that  becomes  a
                           Subsidiary  of the  Company  after the date hereof in
                           accordance  with the terms of Section 5.02(f) that is
                           existing at the time such Person becomes a Subsidiary
                           of the Company  (other than Debt  incurred  solely in
                           contemplation of such Person becoming a Subsidiary of
                           the Company);

                                    (F) Letters of Credit issued for the account
                           of any Foreign  Subsidiary  of the Company to support
                           obligations  in respect of value added  taxes,  in an
                           aggregate  available amount of such letters of credit
                           plus  reimbursement  obligations  thereunder  not  to
                           exceed $7,500,000 at any time outstanding;

                                    (G)  Debt in  respect  of  Hedge  Agreements
                           designed  to hedge  against  fluctuations  in foreign
                           exchange  rates or commodity  prices  incurred in the
                           ordinary  course  of  business  and  consistent  with
                           prudent business practice;

                                    (H) Debt  owing to any  Lender in respect of
                           any overdraft facility, cash management service or in
                           connection with any automated



<PAGE>   113


                                       107

                           clearing  house  transfers of funds of the Company or
                           any  of  its  Subsidiaries  in  an  aggregate  amount
                           outstanding at any time not to exceed $6,500,000;

                                    (I)  Contingent   Obligations   incurred  in
                           connection with transactions permitted under Sections
                           5.02(d)  and  5.02(f)(viii)   (other  than  any  such
                           Contingent  Obligations  created in  contemplation of
                           any such transaction);

                                    (J) current liabilities in respect of taxes,
                           assessments  and   governmental   charges  or  levies
                           incurred, or claims for labor, materials,  inventory,
                           services, supplies and rentals incurred, or for goods
                           or  services  purchased,  in the  ordinary  course of
                           business;

                                    (K) Debt arising  under  surety,  payment or
                           performance  bond  reimbursement  obligation  entered
                           into in the ordinary course of business;

                                    (L)   Debt   arising    under   any   appeal
                           reimbursement   bond  obligation  entered  into  with
                           respect to any  judgment not  constituting  a Default
                           under Section 6.01;

                                    (M)  Debt   incurred  in   connection   with
                           transactions   described   in   clause   (d)  of  the
                           definition of Cash Equivalents; and

                                    (N) Debt not otherwise  permitted under this
                           Section 5.02(b) in an aggregate  principal amount not
                           to exceed $15,000,000 at any time outstanding.

                  (c) Change in Nature of  Business.  Make,  with respect to the
         Company and its  Subsidiaries  taken as a whole, any material change in
         the nature of its business as a diversified manufacturing company.

                  (d) Mergers, Etc. Merge into or consolidate with any Person or
         permit any  Person to merge into it, or permit any of its  Subsidiaries
         to do so, except that:

                           (i) any  Subsidiary  of the Company may merge into or
                  consolidate  with the Company or any other  Subsidiary  of the
                  Company,  provided  that (A) in the case of any such merger or
                  consolidation,   the   Person   formed   by  such   merger  or
                  consolidation   shall  be  the  Company  or  a  wholly   owned
                  Subsidiary of the Company (or, if the merger or  consolidation
                  shall relate to two less than wholly owned Subsidiaries of the
                  Company,  the  surviving  Subsidiary  shall  be  owned  by the
                  Company to the same or greater  extent  immediately  following
                  such transaction as



<PAGE>   114


                                       108

                  was   owned  by  the   Company   immediately   prior  to  such
                  transaction),   (B)  in  the  case  of  any  such   merger  or
                  consolidation  to which a Domestic  Subsidiary  Guarantor is a
                  party, the Person formed by such merger or consolidation shall
                  be a  Domestic  Subsidiary  Guarantor,  (C) in the case of any
                  merger  or  consolidation  to  which  one  Foreign  Subsidiary
                  Guarantor  is a party,  the  Person  formed by such  merger or
                  consolidation  shall  be  such  Foreign  Subsidiary  Guarantor
                  (unless the other party is a Domestic Subsidiary  Guarantor in
                  which case clause (B) above shall apply and (D) in the case of
                  any such merger or  consolidation to which two or more Foreign
                  Subsidiary   Guarantors   are  a  party,   each  such  Foreign
                  Subsidiary  shall be  organized  under the laws of one country
                  and the Person formed by such merger or consolidation shall be
                  a Foreign  Subsidiary  Guarantor  organized  under the laws of
                  such country;

                           (ii) in  connection  with any  acquisition  permitted
                  under Section 5.02(f), any Subsidiary of the Company may merge
                  into or consolidate  with any other Person or permit any other
                  Person to merge into or consolidate with it; provided that the
                  Person   surviving   such  merger  shall  be  a  wholly  owned
                  Subsidiary of the Company (or, if the merger or  consolidation
                  shall relate to two less than wholly owned Subsidiaries of the
                  Company,  the  surviving  Subsidiary  shall  be  owned  by the
                  Company to the same or greater  extent  immediately  following
                  such transaction as was owned by the Company immediately prior
                  to such transaction); and

                           (iii)   in   connection   with   any  sale  or  other
                  disposition permitted under Section 5.02(e) (other than clause
                  (ii) thereof), any Subsidiary of the Company may merge into or
                  consolidate  with any other  Person or permit any other Person
                  to merge into or consolidate with it;

         provided,  however, that in each case,  immediately after giving effect
         thereto,  no event shall occur and be  continuing  that  constitutes  a
         Default.

                  (e) Sales, Etc., of Assets. Sell, lease, transfer or otherwise
         dispose of, or permit any of its Subsidiaries to sell, lease,  transfer
         or otherwise dispose of, any assets, or grant any option or other right
         to purchase, lease or otherwise acquire any assets other than Inventory
         to be sold in the ordinary course of its business, except:

                           (i)  sales  or   dispositions  of  Inventory  in  the
                  ordinary  course of its  business,  assets  which have  become
                  obsolete or assets of Inactive Subsidiaries;

                           (ii)  in a transaction authorized by Section 5.02(d);




<PAGE>   115


                                       109

                           (iii) sales of assets for fair value in an  aggregate
                  amount  not  to  exceed  $90,000,000  from  the  date  hereof,
                  provided that in the case of sales of assets  pursuant to this
                  clause (iii),  the Company shall prepay the Advances  pursuant
                  to,  and in  the  amount,  on the  date  and in the  order  of
                  priority  set forth in Section  2.07(b)(ii)(A),  as  specified
                  therein;

                           (iv) sales,  leases,  transfers or other dispositions
                  of assets not constituting a sale and leaseback by the Company
                  or any wholly-owned  Domestic Subsidiary of the Company to any
                  Foreign Subsidiary of the Company,  in an aggregate amount not
                  to  exceed  $2,500,000,   or  to  the  Company  or  any  other
                  wholly-owned Domestic Subsidiary of the Company;

                           (v) sales, leases, transfers or other dispositions of
                  assets not  constituting  a sale and  leaseback by any Foreign
                  Borrower or any wholly-owned  Subsidiary of a Foreign Borrower
                  to the Company or any wholly owned  Subsidiary  of the Company
                  or to any other Foreign Borrower or wholly-owned Subsidiary of
                  a Foreign Borrower;

                           (vi) so long  as no  Default  is  existing  or  would
                  result  therefrom,  (x)  sale of  assets  for  fair  value  in
                  connection  with trade-in for  replacements of existing assets
                  and (y) sale and  leaseback  transactions  involving  property
                  having  a fair  market  value  at the  time of such  sale  and
                  leaseback  aggregating  not more than $5,000,000 in any Fiscal
                  Year;

                           (vii)  sales of assets  incurred in  connection  with
                  transaction  of  the  type  described  in  clause  (d)  of the
                  definition of Cash Equivalents; and

                           (viii) sales, leases, transfers or other dispositions
                  of assets for cash and for fair value not otherwise  permitted
                  by clauses (i)-(vii) above, provided that in the case of sales
                  of assets  pursuant to this clause (viii),  the Company shall,
                  on the  date  of  receipt  by  any  Loan  Party  or any of its
                  Subsidiaries  of the Net Cash Proceeds from such sale,  lease,
                  transfer or disposition,  prepay the Advances pursuant to, and
                  in the  amount  and order of  priority  set forth in,  Section
                  2.07(b)(ii)(B), as specified therein;

         provided that sales and other dispositions of assets made in accordance
         with clauses (iii) and (viii) above shall be made for not less than 75%
         cash  consideration  with the remainder of the consideration to consist
         of  promissory  notes or  marketable  securities  for which all actions
         contemplated by Section 5.01(j) shall be taken.




<PAGE>   116


                                       110

                  (f) Investments in Other Persons.  Make or hold, or permit any
         of its  Subsidiaries  to make or hold,  any  Investment  in any Person,
         except:

                           (i)  Investments  by the  Company  and  its  Domestic
                  Subsidiaries  in their Domestic  Subsidiaries  existing on the
                  date   hereof   and   additional   Investments   in   Domestic
                  Subsidiaries;

                           (ii)  Investments by the Company and its Subsidiaries
                  in their Foreign  Subsidiaries  outstanding on the date hereof
                  and   additional   investments   in  (except  for   directors'
                  qualifying  shares)  wholly owned Foreign  Subsidiaries  in an
                  aggregate  amount  invested from the date hereof not to exceed
                  $10,000,000;

                           (iii) loans and advances to employees in the ordinary
                  course of the business of the Company and its  Subsidiaries as
                  presently  conducted in an aggregate  principal  amount not to
                  exceed $2,000,000 at any time outstanding;

                           (iv)  Investments by the Company and its Subsidiaries
                  in  Cash  Equivalents  provided  that  amounts  in  excess  of
                  $5,000,000 shall be held by the Collateral Agent or be subject
                  to a first priority  perfected lien in favor or the Collateral
                  Agent;

                           (v)  Investments  existing  on the  date  hereof  and
                  described on Schedule 4.01(y) hereto;

                           (vi)  Investments by the Company and its Subsidiaries
                  in Hedge  Agreements  permitted  under  Section  5.02(b)(i) or
                  5.02(b)(iii)(H);

                           (vii)  Investments  consisting of  intercompany  Debt
                  permitted under Section 5.02(b)(ii); and

                           (viii)  other  Investments  in  an  aggregate  amount
                  invested in connection  with joint ventures and newly acquired
                  Subsidiaries;  provided that with respect to Investments  made
                  under this clause (viii):

                           (1) any newly acquired or organized Subsidiary of the
                  Company or any of its Subsidiaries  shall be not less than 80%
                  owned  (directly or  indirectly) by the Company in the case of
                  any Domestic  Subsidiary and not less than 90% owned (directly
                  or  indirectly)  by the  Company  in the  case of any  Foreign
                  Subsidiary;

                           (2)  immediately   before  and  after  giving  effect
                  thereto,  no Default  shall have occurred and be continuing or
                  would result therefrom;



<PAGE>   117


                                       111

                           (3) any company or  business  acquired or invested in
                  pursuant  to  this  clause   (viii)  shall  be,   directly  or
                  indirectly, in a basic manufacturing business;

                           (4)   immediately   after   giving   effect   to  the
                  acquisition  of a company or business  pursuant to this clause
                  (viii),  the Company shall be in pro forma compliance with the
                  covenants  contained in Section 5.04,  calculated based on the
                  financial  statements  most  recently  delivered to the Lender
                  Parties   pursuant   to  Section   5.03  and  as  though  such
                  acquisition had occurred at the beginning of the  four-quarter
                  period  covered  thereby,  as evidenced by a certificate  of a
                  Designated  Officer  of the  Company  delivered  to the Lender
                  Parties demonstrating such compliance; provided however, that,
                  notwithstanding   the   foregoing,   the   Company   and   its
                  Subsidiaries  may make  additional  Investments  to the extent
                  that such pro forma  calculation  indicates a Senior  Leverage
                  Ratio of not more than 4.00:1.00 and a Total Leverage Ratio of
                  not more than 4.75:1.00; and

                           (5) the Company  and its  Subsidiaries  shall  comply
                  with the requirements of Section 5.01(j); and

                           (ix)   Investments  in  accounts,   contract  rights,
                  chattel  paper  (each as  defined  in the  Uniform  Commercial
                  Code),  notes receivable and similar items arising or acquired
                  in the ordinary course of business.

                  (g)  Restricted  Payments.   Declare  or  pay  any  dividends,
         purchase, redeem, retire, defease or otherwise acquire for value any of
         its capital  stock or any  warrants,  rights or options to acquire such
         capital stock, now or hereafter outstanding,  return any capital to its
         stockholders as such, make any  distribution of assets,  capital stock,
         warrants,   rights,   options,   obligations   or   securities  to  its
         stockholders  as such  or  issue  or  sell  any  capital  stock  or any
         warrants, rights or options to acquire such capital stock or accept any
         capital  contributions,  or permit any of its Subsidiaries to do any of
         the foregoing,  or permit any of its Subsidiaries to purchase,  redeem,
         retire, defease or otherwise acquire for value any capital stock of the
         Company or any  warrants,  rights or options  to acquire  such  capital
         stock or to issue or sell any capital stock or any warrants,  rights or
         options to acquire  such  capital  stock,  except  that,  so long as no
         Default shall have occurred and be continuing at the time of any action
         described in clause (i), (ii) or (iii) below or would result therefrom:

                           (i) the Company may (A) declare and pay dividends and
                  distributions payable only in common stock of the Company, (B)
                  on or before July 30, 1999,  declare and pay dividends payable
                  in  and  make   distributions   of  Precious  Metal  Inventory
                  reflected on Schedule  5.02(g),  (C) declare and pay dividends
                  or make  other  payments  required  to be made  under  the Tax
                  Agreement, provided that with



<PAGE>   118


                                       112

                  respect to any  dividends  declared and paid under this clause
                  (C),  both before and after such  declaration  and payment the
                  Total Leverage Ratio shall not be greater than 4.50:1.00,  (D)
                  declare and pay cash dividends in an amount in any Fiscal Year
                  in an amount,  together  with any  payments  made  pursuant to
                  Section  5.02(k)(iii),  that is equal to a  percentage  of the
                  Excess Cash Flow for the immediately  preceding Fiscal Year as
                  follows:  (1) if the  Total  Leverage  Ratio as at the time of
                  such declaration is equal to or greater than 4.00:1.00,  12.5%
                  and (2) if the  Total  Leverage  Ratio  as at the time of such
                  declaration  is less than  4.00:1.00  but equal to or  greater
                  than 3.50:1.00,  25%, provided that for the Fiscal Year ending
                  December 31, 1998,  such Excess Cash Flow shall be  determined
                  for the period from April 13, 1998 through  December 31, 1998,
                  and (E) declare and pay cash  dividends if the Total  Leverage
                  Ratio  as at the time of such  declaration  and  after  giving
                  effect to such  payment  under this clause (E) and any payment
                  made pursuant to Section 5.02(k)(iv) is less than 3.50:1.00;

                           (ii) any  Subsidiary  of the  Company may (A) declare
                  and pay cash  dividends  to the  Company,  (B) declare and pay
                  cash  dividends to any other wholly  owned  Subsidiary  of the
                  Company of which it is a  Subsidiary  and (C)  accept  capital
                  contributions  from its parent to the extent  permitted  under
                  Section 5.01(f)(i); and

                           (iii) the  Company  and any  Subsidiary  may issue or
                  sell  capital  stock  and/or  warrants,  rights or  options to
                  acquire  capital  stock  (A)  to  the  Company  or  any  other
                  Subsidiary or (B) in connection with transaction  permitted by
                  Section 5.02(d) hereof.

         provided,  however,  the Company may issue or sell capital stock to WHX
         Corporation or any of its  Subsidiaries to permit the Company to comply
         with the Senior Leverage Ratio or the Total Leverage Ratio,  subject to
         the provisions of Section 6.01(c).

                  (h)  Lease  Obligations.  Create,  incur,  assume or suffer to
         exist, or permit any of its  Subsidiaries to create,  incur,  assume or
         suffer to exist,  any  obligations as lessee (i) for the rental or hire
         of real or personal  property in connection with any sale and leaseback
         transaction,  or (ii) for the rental or hire of other real or  personal
         property of any kind under  leases or  agreements  to lease (other than
         Capitalized  Leases)  having an original  term of one year or more that
         would cause the direct and  contingent  liabilities  of the Company and
         its  Subsidiaries,  on a  Consolidated  basis,  in  respect of all such
         obligations  to  exceed  $10,000,000   payable  in  any  period  of  12
         consecutive  months in  respect  of the  Precious  Metals  Leasing  and
         $13,000,000  payable in any period of 12 consecutive  months in respect
         of all other leases.




<PAGE>   119


                                       113

                  (i) Amendments of Constitutive Documents. Amend, or permit any
         of its  Subsidiaries  to amend,  its  certificate of  incorporation  or
         bylaws or other  constitutive  documents other than changes which could
         not reasonably be expected to have a Material Adverse Effect.

                  (j) Accounting  Changes.  Make or permit, or permit any of its
         Subsidiaries to make or permit,  any change in (i) accounting  policies
         or  reporting  practices,  except as  required  by  generally  accepted
         accounting principles, or (ii) its Fiscal Year.

                  (k)  Prepayments,  Etc., of Debt.  Prepay,  redeem,  purchase,
         defease or otherwise satisfy prior to the scheduled maturity thereof in
         any manner, or make any payment in violation of any subordination terms
         of, any Surviving Debt or Subordinated Debt, except (i) refinancings of
         any Surviving  Debt in accordance  with Section  5.02(b)(iii)(D),  (ii)
         regularly  scheduled or required repayments or redemptions of Surviving
         Debt, (iii)  prepayments of Subordinated  Debt in any Fiscal Year in an
         amount,   together  with  any   dividends   made  pursuant  to  Section
         5.02(g)(i)(D),  that is equal to a  percentage  of the Excess Cash Flow
         for the immediately  preceding Fiscal Year as follows: (1) if the Total
         Leverage  Ratio  as at the  time of such  declaration  is  equal  to or
         greater than 4.00:1.00, 12.5% and (2) if the Total Leverage Ratio as at
         the time of such  declaration  is less than  4.00:1.00  but equal to or
         greater than 3.50:1.00,  25%,  provided that for the Fiscal Year ending
         December 31, 1998,  such Excess Cash Flow shall be  determined  for the
         period  from  April  13,  1998  through  December  31,  1998  and  (iv)
         prepayments of Subordinated  Debt if the Total Leverage Ratio as at the
         time of such  prepayment  and after giving effect to such payment under
         this  clause  (iv)  and  any   dividends   made   pursuant  to  Section
         5.02(g)(i)(E) is less than 3.50:1.00, or amend, modify or change in any
         manner any term or  condition  of any  Surviving  Debt or  Subordinated
         Debt, or permit any of its Subsidiaries to do any of the foregoing.

                  (l) Amendment, Etc., of Related Documents. Cancel or terminate
         any  Related  Document  or  consent to or accept  any  cancellation  or
         termination thereof,  amend, modify or change in any manner any term or
         condition  of any  Related  Document  or give any  consent,  waiver  or
         approval thereunder,  waive any default under or any breach of any term
         or condition of any Related Document,  agree in any manner to any other
         amendment,  modification  or  change  of any term or  condition  of any
         Related  Document  or take any  other  action  in  connection  with any
         Related  Document that would impair the value of the interest or rights
         of any Loan  Party  thereunder  in any  material  respect or that would
         impair the rights or  interests of any Agent or any Lender Party in any
         material  respect,  or permit any of its  Subsidiaries to do any of the
         foregoing.

                  (m) Negative Pledge.  Enter into or suffer to exist, or permit
         any of its Subsidiaries to enter into or suffer to exist, any agreement
         prohibiting or conditioning the

<PAGE>   120


                                       114

         creation or  assumption  of any Lien upon any of its property or assets
         except for any such  agreement  (i) in favor of the Secured  Parties or
         (ii) in connection  with (A) any Surviving Debt, (B) any purchase money
         Debt permitted by Section 5.02(b)(iii)(B) solely to the extent that the
         agreement or  instrument  governing  such Debt  prohibits a Lien on the
         property acquired with the proceeds of such Debt or (C) any Capitalized
         Lease  permitted by Section  5.02(b)(iii)(C)  solely to the extent that
         such Capitalized Lease prohibits a Lien on the property subject thereto
         or (D) Precious Metals Leasing.

                  (n) Partnerships, Etc. Become a general partner in any general
         or  limited  partnership  or  joint  venture,  or  permit  any  of  its
         Subsidiaries  to do so,  other than any  Subsidiary  the sole assets of
         which consist of its interest in such partnership or joint venture.

                  (o)  Speculative  Transactions.  Engage,  or permit any of its
         Subsidiaries to engage, in any transaction  involving commodity options
         or futures contracts or any similar speculative transactions other than
         those incurred in the ordinary  course of business and consistent  with
         past practice.

                  (p)  Capital   Expenditures.   Make,  or  permit  any  of  its
         Subsidiaries  to make,  any Capital  Expenditures  that would cause the
         aggregate of all such Capital  Expenditures made by the Company and its
         Subsidiaries  in any  period  set forth  below to exceed the amount set
         forth below for such period.


                       Year Ending In          Amount
                  ======================== =============
                  1998                     $25,000,000
                  ------------------------ -------------
                  1999                     $26,500,000
                  ------------------------ -------------
                  2000                     $28,000,000
                  ------------------------ -------------
                  2001                     $29,500,000
                  ------------------------ -------------
                  2002                     $30,000,000
                  ------------------------ -------------
                  2003                     $30,000,000
                  ------------------------ -------------
                  2004                     $30,000,000
                  ------------------------ -------------
                  2005                     $30,000,000
                  ------------------------ -------------
                  2006                     $30,000,000
                  ------------------------ -------------
<PAGE>   121


                                       115


         plus,  for each Fiscal Year set forth above,  an amount equal to 25% of
         the excess of the amount of Capital  Expenditures  permitted to be made
         by the  Company  and its  Subsidiaries  in such  prior  year  over  the
         aggregate  amount of Capital  Expenditures  made by the Company and its
         Subsidiaries during such prior year.

                  (q) Formation of Subsidiaries.  Organize or invest,  or permit
         any Subsidiary to organize or invest,  in any new Subsidiary  except as
         permitted under Section 5.02(f)(viii).

                  (r) Payment Restrictions Affecting  Subsidiaries.  Directly or
         indirectly,  enter  into or  suffer  to  exist,  or  permit  any of its
         Subsidiaries  to enter  into or  suffer  to  exist,  any  agreement  or
         arrangement  limiting the ability of any of its Subsidiaries to declare
         or pay dividends or other distributions in respect of its capital stock
         or repay or prepay  any Debt owed to,  make  loans or  advances  to, or
         otherwise  transfer  assets  to  or  invest  in,  the  Company  or  any
         Subsidiary  of the  Company  (whether  through a  covenant  restricting
         dividends,  loans, asset transfers or investments, a financial covenant
         or  otherwise),  except (i) the Loan  Documents,  (ii) any agreement or
         instrument  evidencing Surviving Debt and (iii) any agreement in effect
         at the time such  Subsidiary  becomes a Subsidiary  of the Company,  so
         long as such agreement was not entered into solely in  contemplation of
         such Person becoming a Subsidiary of the Company.

                  SECTION 5.03. Reporting  Requirements.  So long as any Advance
or any other  Obligation of any Loan Party under any Loan Document  shall remain
unpaid, any Letter of Credit or Bankers'  Acceptance shall be outstanding or any
Lender Party shall have any  Commitment  hereunder,  the Company will furnish to
the Agents and (except in the case of subsection (o) below) the Lender Parties:

                  (a)  Default  Notices.  As soon as  possible  and in any event
         within two Business  Days after the  occurrence  of each Default or any
         event,  development or occurrence  reasonably likely to have a Material
         Adverse Effect continuing on the date of such statement, a statement of
         a  Designated  Officer of the  Company  setting  forth  details of such
         Default and the action that the Company has taken and  proposes to take
         with respect thereto.

                  (b) Annual  Financials.  (i) As soon as  available  and in any
         event  within 90 days after the end of each Fiscal  Year, a copy of the
         annual audit report for such year for the Company and its Subsidiaries,
         including  therein  Consolidated  balance sheets of the Company and its
         Subsidiaries  as of the  end  of  such  Fiscal  Year  and  Consolidated
         statements of income and a Consolidated  statement of cash flows of the
         Company  and its  Subsidiaries  for  such  Fiscal  Year,  in each  case
         accompanied  by an  opinion  acceptable  to  the  Required  Lenders  of
         independent public accountants of nationally recognized standing



<PAGE>   122


                                       116

         in the United States acceptable to the Required Lenders,  together with
         (A) a certificate of such accounting firm to the Lender Parties stating
         that in the course of the regular  audit of the business of the Company
         and its Subsidiaries, which audit was conducted by such accounting firm
         in  accordance  with  generally  accepted  auditing   standards,   such
         accounting  firm has obtained no knowledge  that a Default has occurred
         and is  continuing,  or if, in the opinion of such  accounting  firm, a
         Default has  occurred and is  continuing,  a statement as to the nature
         thereof,  (B) a schedule  in form  satisfactory  to the  Administrative
         Agent of the computations  used by such accountants in determining,  as
         of the end of such Fiscal Year, compliance with the covenants contained
         in Section 5.04,  provided that in the event of any change in GAAP used
         in the preparation of such financial statements, the Company shall also
         provide,  if necessary for the determination of compliance with Section
         5.04,  a  statement  of   reconciliation   conforming   such  financial
         statements to GAAP and (C) a certificate of a Designated Officer of the
         Company stating that no Default has occurred and is continuing or, if a
         default has  occurred and is  continuing,  a statement as to the nature
         thereof and the action that the Company has taken and  proposes to take
         with respect thereto.
 .
                  (ii) As soon as  available  and in any  event  within  90 days
         after the end of each Fiscal  Year,  a copy of the annual  audit report
         for  such  year for WHX  Corporation  and its  Subsidiaries,  including
         therein  Consolidated  balance  sheets of the WHX  Corporation  and its
         Subsidiaries  as of the  end  of  such  Fiscal  Year  and  Consolidated
         statements of income and a Consolidated  statement of cash flows of the
         WHX Corporation and its Subsidiaries for such Fiscal Year, in each case
         accompanied  by an  opinion  acceptable  to  the  Required  Lenders  of
         PriceWaterhouseCoopers  or  other  independent  public  accountants  of
         recognized standing acceptable to the Required Lenders, together with a
         certificate of such  accounting firm to the Lender Parties stating that
         such audit was conducted by such  accounting  firm in  accordance  with
         generally accepted auditing standards.

                  (c) Quarterly Financials.  (i) As soon as available and in any
         event within 45 days after the end of each of the first three  quarters
         of each Fiscal Year, Consolidated balance sheets of the Company and its
         Subsidiaries as of the end of such quarter and Consolidated  statements
         of income and a Consolidated statement of cash flows of the Company and
         its Subsidiaries  for the period  commencing at the end of the previous
         fiscal  quarter  and ending  with the end of such  fiscal  quarter  and
         Consolidated  statements of income and a Consolidated statement of cash
         flows of the Company and its Subsidiaries for the period  commencing at
         the end of the  previous  Fiscal  Year and ending  with the end of such
         quarter,   setting  forth  in  each  case  in   comparative   form  the
         corresponding  figures  for the  corresponding  date or  period  of the
         preceding  Fiscal Year,  all in  reasonable  detail and duly  certified
         (subject to normal year-end audit  adjustments) by a Designated Officer
         of the  Company  as having  been  prepared  in  accordance  with  GAAP,
         together with (A) a certificate of said officer stating that no Default
         has occurred and is continuing or, if a



<PAGE>   123


                                       116

         Default has  occurred and is  continuing,  a statement as to the nature
         thereof and the action that the Company has taken and  proposes to take
         with  respect  thereto and (B) a schedule in form  satisfactory  to the
         Administrative  Agent  of  the  computations  used  by the  Company  in
         determining  compliance  with the covenants  contained in Section 5.04,
         provided  that  in  the  event  of  any  change  in  GAAP  used  in the
         preparation  of such  financial  statements,  the  Company  shall  also
         provide,  if necessary for the determination of compliance with Section
         5.04,  a  statement  of   reconciliation   conforming   such  financial
         statements to GAAP.

                  (ii) As soon as  available  and in any  event  within  45 days
         after the end of each of the first three  quarters of each Fiscal Year,
         Consolidated  balance sheets of WHX Corporation and its Subsidiaries as
         of the end of such quarter and Consolidated  statements of income and a
         Consolidated  statement  of  cash  flows  of WHX  Corporation  and  its
         Subsidiaries  for the  period  commencing  at the  end of the  previous
         fiscal  quarter  and ending  with the end of such  fiscal  quarter  and
         Consolidated  statements of income and a Consolidated statement of cash
         flows of WHX Corporation and its Subsidiaries for the period commencing
         at the end of the previous  Fiscal Year and ending with the end of such
         quarter,   setting  forth  in  each  case  in   comparative   form  the
         corresponding  figures  for the  corresponding  date or  period  of the
         preceding  Fiscal Year,  all in  reasonable  detail and duly  certified
         (subject to normal year-end audit  adjustments) by a Designated Officer
         of the Company as having been prepared in accordance with GAAP.

                  (d) Annual Forecasts. As soon as available and in any event no
         later than 15 days  before the end of each  Fiscal  Year,  Consolidated
         and, as to the five  business  segments of the Company,  consolidating,
         forecasted balance sheets,  statements of income and statements of cash
         flows of the Company and its Subsidiaries prepared by management of the
         Company, in form satisfactory to the Administrative Agent, on a monthly
         basis for the Fiscal Year  following  such Fiscal Year and on an annual
         basis for each  Fiscal Year  thereafter  until one year after the Final
         Maturity Date.

                  (e)  Litigation.  Promptly  after  the  commencement  thereof,
         notice  of  all  actions,   suits,   investigations,   litigation   and
         proceedings  before any court or governmental  department,  commission,
         board,  bureau,   agency  or  instrumentality,   domestic  or  foreign,
         affecting  any  Loan  Party  or  any of its  Subsidiaries  of the  type
         described in Section 4.01(f).

                  (f) Securities  Reports.  Promptly after the sending or filing
         thereof,  copies  of all proxy  statements,  financial  statements  and
         reports  that any Loan  Party or any of its  Subsidiaries  sends to its
         stockholders,  and copies of all regular, periodic and special reports,
         and all  registration  statements,  that any  Loan  Party or any of its
         Subsidiaries  files with the Securities and Exchange  Commission or any
         governmental  authority that may be substituted  therefor,  or with any
         provincial or national securities exchange.




<PAGE>   124


                                       118

                  (g) Creditor Reports.  Promptly after the furnishing  thereof,
         copies of any  statement  or  report  furnished  to any  holder of Debt
         securities of any Loan Party or of any of its Subsidiaries  pursuant to
         the terms of any indenture, loan or credit or similar agreement and not
         otherwise  required to be furnished to the Lender  Parties  pursuant to
         any other clause of this Section 5.03.

                  (h) Agreement Notices.  Promptly upon receipt thereof,  copies
         of all notices, requests and other documents received by any Loan Party
         or any of its Subsidiaries under or pursuant to any Related Document or
         instrument, indenture, loan or credit or similar agreement regarding or
         related  to any  breach or  default  by any party  thereto or any other
         event that could  materially  impair the value of the  interests or the
         rights of any Loan Party or otherwise  have a Material  Adverse  Effect
         and copies of any amendment, modification or waiver of any provision of
         any  Related  Document  or  instrument,  indenture,  loan or  credit or
         similar   agreement  and,  from  time  to  time  upon  request  by  the
         Administrative  Agent,  such  information  and  reports  regarding  the
         Related Documents and such instruments,  indentures and loan and credit
         and  similar  agreements  as the  Administrative  Agent may  reasonably
         request.

                  (i)  Revenue  Agent  Reports.  Within 10 days  after  receipt,
         copies of all Revenue  Agent  Reports  (Internal  Revenue  Service Form
         886), or other written proposals of the Internal Revenue Service,  that
         propose,  determine or otherwise set forth positive  adjustments to the
         Federal  income tax  liability  of the  affiliated  group  (within  the
         meaning of Section  1504(a)(1)  of the Internal  Revenue Code) of which
         the Company is a member aggregating $1,000,000 or more.

                  (j) Tax  Certificates.  Promptly,  and in any event within ten
         Business Days after the due date (with extensions) for filing the final
         Federal   income  tax  return  in  respect  of  each  taxable  year,  a
         certificate  (a  "Tax  Certificate"),  signed  by  the  President  or a
         Designated  Officer of the Company,  stating that the common  parent of
         the affiliated  group (within the meaning of Section  1504(a)(1) of the
         Internal Revenue Code) of which the Company is a member has paid to the
         Internal  Revenue  Service or other taxing  authority,  the full amount
         that such  affiliated  group is  required  to pay in respect of Federal
         income tax for such year and that the Company and its Subsidiaries have
         received  any  amounts  payable to them,  and have not paid  amounts in
         respect of taxes  (Federal,  state,  local or foreign) in excess of the
         amount they are required to pay,  under the Tax Agreement in respect of
         such taxable year.

                  (k) ERISA.  (i) ERISA Events and ERISA  Reports.  (A) Promptly
         and in any  event  within  10 days  after  any Loan  Party or any ERISA
         Affiliate  knows  or has  reason  to know  that  any  ERISA  Event  has
         occurred, a statement of a Designated Officer of the Company describing
         such ERISA Event and the action, if any, that such Loan Party or



<PAGE>   125


                                       119

         such  ERISA  Affiliate  has taken  and  proposes  to take with  respect
         thereto and (B) on the date any records, documents or other information
         must be  furnished  to the PBGC with  respect to any Plan  pursuant  to
         Section  4010  of  ERISA,  a  copy  of  such  records,   documents  and
         information.

                  (ii) Plan  Terminations.  Promptly and in any event within two
         Business  Days  after  receipt  thereof  by any Loan Party or any ERISA
         Affiliate, copies of each notice from the PBGC stating its intention to
         terminate  any Plan or to have a trustee  appointed to  administer  any
         Plan.

                  (iii)  Multiemployer  Plan Notices.  Promptly and in any event
         within five Business  Days after  receipt  thereof by any Loan Party or
         any ERISA Affiliate from the sponsor of a Multiemployer Plan, copies of
         each notice  concerning (A) the  imposition of Withdrawal  Liability by
         any such  Multiemployer  Plan, (B) the  reorganization  or termination,
         within the meaning of Title IV of ERISA, of any such Multiemployer Plan
         or (C) the amount of liability  incurred,  or that may be incurred,  by
         such Loan Party or any ERISA  Affiliate  in  connection  with any event
         described in clause (A) or (B).

                  (l) Environmental Conditions.  Promptly after the assertion or
         occurrence  thereof,  notice of any Environmental  Action against or of
         any noncompliance by any Loan Party or any of its Subsidiaries with any
         Environmental Law or Environmental  Permit that could (i) reasonably be
         expected to have a Material  Adverse  Effect or (ii) cause any property
         described in the  Mortgages to be subject to any material  restrictions
         on ownership, occupancy, use or transferability under any Environmental
         Law.

                  (m)  Real  Property.  As soon as  available  and in any  event
         within  30  days  after  the  end  of  each  Fiscal   Year,   a  report
         supplementing  Schedules  4.01(w)  and  4.01(x)  hereto,  including  an
         identification of all owned and leased real property disposed of by the
         Company or any of its Subsidiaries  during such Fiscal Year, a list and
         description  (including  the street  address,  county or other relevant
         jurisdiction,  state, record owner, book value thereof and, in the case
         of leases of  property,  lessor,  lessee,  expiration  date and  annual
         rental cost  thereof) of all real  property  acquired or leased  during
         such  Fiscal  Year  and a  description  of such  other  changes  in the
         information  included in such  Schedules as may be  necessary  for such
         Schedules  to be  accurate  and  complete,  other  than owned or leased
         property in each case with an aggregate fair market value not exceeding
         $100,000.

                  (n) Insurance. As soon as available and in any event within 30
         days  after  the end of each  Fiscal  Year,  a report  summarizing  the
         insurance coverage  (specifying type, amount and carrier) in effect for
         the  Company  and  its  Subsidiaries  and  containing  such  additional
         information   as  any  Agent,   or  any  Lender   Party   through   the
         Administrative Agent, may reasonably specify.



<PAGE>   126


                                       120

                  (o) Borrowing  Base  Certificate.  As soon as available and in
         any event within 20 days after the end of each month,  a Borrowing Base
         Certificate,  as at the  end  of the  previous  month,  certified  by a
         Designated Officer of the Company.

                  (p) Year 2000 Compliance. Promptly after the Company discovers
         or determines  that any computer  application  (including  those of its
         suppliers,  vendors  and  customers)  that is  material  to its and its
         Subsidiaries'  business and operations will not be Year 2000 compliant,
         except to the extent that such failure could not be reasonably expected
         to have a Material Adverse Effect, notice of such failure.

                  (q) Other Information.  Such other information  respecting the
         business, condition (financial or otherwise), operations,  performance,
         properties or prospects of any Loan Party or any of its Subsidiaries as
         any Agent, or any Lender Party through the  Administrative  Agent,  may
         from time to time reasonably request.

                  SECTION 5.04. Financial  Covenants.  So long as any Advance or
any other  Obligation  of any Loan Party under any Loan  Document  shall  remain
unpaid, any Letter of Credit or Bankers'  Acceptance shall be outstanding or any
Lender Party shall have any Commitment hereunder, the Company will:

                  (a) Fixed Charge Coverage  Ratio.  Maintain at the end of each
         fiscal quarter of the Company a Fixed Charge Coverage Ratio of not less
         than the ratio set forth below for each period set forth below:



<PAGE>   127


                                       121



        Quarter Ending                        Ratio
====================================== =======================
September 30, 1998                     1.15:1.00
December 31, 1998                      1.15:1.00
-------------------------------------- -----------------------
March 31, 1999                         1.15:1.00
June 30, 1999                          1.15:1.00
September 30, 1999                     1.15:1.00
December 31, 1999                      1.15:1.00
-------------------------------------- -----------------------
March 31, 2000                         1.25:1.00
June 30, 2000                          1.25:1.00
September 30, 2000                     1.25:1.00
December 31, 2000                      1.25:1.00
-------------------------------------- -----------------------
March 31, 2001                         1.35:1.00
June 30, 2001                          1.35:1.00
September 30, 2001                     1.35:1.00
December 31, 2001                      1.35:1.00
-------------------------------------- -----------------------
March 31, 2002                         1.35:1.00
June 30, 2002                          1.35:1.00
September 30, 2002                     1.35:1.00
December 31, 2002                      1.35:1.00
-------------------------------------- -----------------------
March 31, 2003                         1.40:1.00
June 30, 2003                          1.40:1.00
September 30, 2003                     1.40:1.00
December 31, 2003                      1.40:1.00
-------------------------------------- -----------------------
March 31, 2004                         1.40:1.00
June 30, 2004                          1.40:1.00
September 30, 2004                     1.40:1.00
December 31, 2004                      1.40:1.00
-------------------------------------- -----------------------
March 31, 2005                         1.40:1.00
June 30, 2005                          1.40:1.00
September 30, 2005                     1.40:1.00
December 31, 2005                      1.40:1.00
-------------------------------------- -----------------------
March 31, 2006                         1.40:1.00
June 30, 2006                          1.40:1.00
September 30, 2006                     1.40:1.00
December 31, 2006                      1.40:1.00
-------------------------------------- -----------------------



<PAGE>   128
                                       122


                  (b) Senior Leverage Ratio.  Maintain at the end of each fiscal
         quarter  of the  Company a Senior  Leverage  Ratio of not more than the
         ratio set forth below for each period set forth below:


           Quarter Ending                      Ratio
===================================== =======================
September 30, 1998                    4.70:1.00
December 31, 1998                     4.70:1.00
------------------------------------- -----------------------
March 31, 1999                        4.55:1.00
June 30, 1999                         4.55:1.00
September 30, 1999                    4.55:1.00
December 31, 1999                     4.55:1.00
------------------------------------- -----------------------
March 31, 2000                        4.25:1.00
June 30, 2000                         4.25:1.00
September 30, 2000                    4.25:1.00
December 31, 2000                     4.25:1.00
------------------------------------- -----------------------
March 31, 2001                        3.95:1.00
June 30, 2001                         3.95:1.00
September 30, 2001                    3.95:1.00
December 31, 2001                     3.95:1.00
------------------------------------- -----------------------
March 31, 2002                        3.75:1.00
June 30, 2002                         3.75:1.00
September 30, 2002                    3.75:1.00
December 31, 2002                     3.75:1.00
------------------------------------- -----------------------
March 31, 2003                        3.50:1.00
June 30, 2003                         3.50:1.00
September 30, 2003                    3.50:1.00
December 31, 2003                     3.50:1.00
------------------------------------- -----------------------
March 31, 2004                        3.25:1.00
June 30, 2004                         3.25:1.00
September 30, 2004                    3.25:1.00
December 31, 2004                     3.25:1.00
------------------------------------- -----------------------
March 31, 2005                        3.25:1.00
June 30, 2005                         3.25:1.00
September 30, 2005                    3.25:1.00
December 31, 2005                     3.25:1.00
------------------------------------- -----------------------
March 31, 2006                        3.25:1.00
June 30, 2006                         3.25:1.00
September 30, 2006                    3.25:1.00
December 31, 2006                     3.25:1.00
------------------------------------- -----------------------



<PAGE>   129
                                      123

                  (c) Total Leverage  Ratio.  Maintain at the end of each fiscal
         quarter  of the  Company  a Total  Leverage  Ratio of not more than the
         ratio set forth below for each period set forth below:


           Quarter Ending                      Ratio
===================================== =======================
September 30, 1998                    5.00:1.00
December 31, 1998                     5.00:1.00
------------------------------------- -----------------------
March 31, 1999                        5.00:1.00
June 30, 1999                         5.00:1.00
September 30, 1999                    5.00:1.00
December 31, 1999                     5.00:1.00
------------------------------------- -----------------------
March 31, 2000                        5.00:1.00
June 30, 2000                         5.00:1.00
September 30, 2000                    5.00:1.00
December 31, 2000                     5.00:1.00
------------------------------------- -----------------------
March 31, 2001                        5.00:1.00
June 30, 2001                         5.00:1.00
September 30, 2001                    5.00:1.00
December 31, 2001                     5.00:1.00
------------------------------------- -----------------------
March 31, 2002                        4.75:1.00
June 30, 2002                         4.75:1.00
September 30, 2002                    4.75:1.00
December 31, 2002                     4.75:1.00
------------------------------------- -----------------------
March 31, 2003                        4.75:1.00
June 30, 2003                         4.75:1.00
September 30, 2003                    4.75:1.00
December 31, 2003                     4.75:1.00
------------------------------------- -----------------------
March 31, 2004                        4.50:1.00
June 30, 2004                         4.50:1.00
September 30, 2004                    4.50:1.00
December 31, 2004                     4.50:1.00
------------------------------------- -----------------------
March 31, 2005                        4.00:1.00
June 30, 2005                         4.00:1.00
September 30, 2005                    4.00:1.00
December 31, 2005                     4.00:1.00
------------------------------------- -----------------------
March 31, 2006                        4.00:1.00
June 30, 2006                         4.00:1.00
September 30, 2006                    4.00:1.00
December 31, 2006                     4.00:1.00
===================================== =======================


<PAGE>   130

                                      124

                  (d)  Interest  Coverage  Ratio.  Maintain  at the  end of each
         fiscal  quarter of the Company an Interest  Coverage  Ratio of not less
         than the ratio set forth below for each period set forth below:


           Quarter Ending                      Ratio
September 30, 1998                    2.25:1.00
December 31, 1998                     2.25:1.00
----------------------------------  -------------------------
March 31, 1999                        2.30:1.00
June 30, 1999                         2.30:1.00
September 30, 1999                    2.30:1.00
December 31, 1999                     2.30:1.00
----------------------------------  -------------------------
March 31, 2000                        2.55:1.00
June 30, 2000                         2.55:1.00
September 30, 2000                    2.55:1.00
December 31, 2000                     2.55:1.00
----------------------------------  -------------------------
March 31, 2001                        2.85:1.00
June 30, 2001                         2.85:1.00
September 30, 2001                    2.85:1.00
December 31, 2001                     2.85:1.00
----------------------------------  -------------------------
March 31, 2002                        3.15:1.00
June 30, 2002                         3.15:1.00
September 30, 2002                    3.15:1.00
December 31, 2002                     3.15:1.00
----------------------------------  -------------------------
March 31, 2003                        3.35:1.00
June 30, 2003                         3.35:1.00
September 30, 2003                    3.35:1.00
December 31, 2003                     3.35:1.00
----------------------------------  -------------------------
March 31, 2004                        3.50:1.00
June 30, 2004                         3.50:1.00
September 30, 2004                    3.50:1.00
December 31, 2004                     3.50:1.00
----------------------------------  -------------------------
March 31, 2005                        3.50:1.00
June 30, 2005                         3.50:1.00
September 30, 2005                    3.50:1.00
December 31, 2005                     3.50:1.00
----------------------------------  -------------------------
March 31, 2006                        3.50:1.00
June 30, 2006                         3.50:1.00
September 30, 2006                    3.50:1.00
December 31, 2006                     3.50:1.00
----------------------------------  -------------------------



<PAGE>   131


                                       125

                                   ARTICLE VI
                                EVENTS OF DEFAULT

                  SECTION  6.01.  Events  of  Default.  If any of the  following
events ("Events of Default") shall occur and be continuing:

                  (a) (i) any  Borrower  shall fail to pay any  principal of any
         Advance or any portion of any Bankers'  Acceptance  when the same shall
         become  due and  payable  or (ii) any  Borrower  shall  fail to pay any
         interest on any Advance, or any Loan Party shall fail to make any other
         payment  under any Loan  Document,  in each case under this clause (ii)
         within five days after the same becomes due and payable; or

                  (b) any  representation or warranty made by any Loan Party (or
         any of its  officers)  under or in  connection  with any Loan  Document
         shall prove to have been  incorrect in any material  respect when made;
         or

                  (c) any  Borrower  shall fail to perform or observe  any term,
         covenant or agreement  contained in Section  2.16,  5.01(e),  (f), (i),
         (j), (m) or (p), 5.02, 5.03 or 5.04; provided, however, that no Default
         shall be deemed to have occurred with respect to Section 5.04(b) or (c)
         as at the end of any fiscal  quarter if,  prior to the  delivery of the
         financial  statements  required by Section  5.03(b)(i) or 5.03(c)(i) in
         respect  of such  fiscal  quarter,  the  Company  shall  have  received
         additional  equity  and shall  have  made the  prepayment  required  by
         Section  2.07(b)(iii)(y)  and,  as  a  result  thereof,  assuming  such
         additional  equity  contribution  had been made on the last day of such
         fiscal  quarter,  the Company  shall have  complied  with such  Section
         5.04(b) or (c) on a pro forma basis; or

                  (d) any Loan Party  shall fail to perform or observe any other
         term,  covenant or agreement contained in any Loan Document on its part
         to be performed or observed if such failure shall remain unremedied for
         15 days  after  the  earlier  of the  date on which  (i) a  Responsible
         Officer  becomes aware of such failure or (ii) written  notice  thereof
         shall have been given to the Company by any Agent or any Lender  Party;
         or

                  (e) any Loan  Party or any of its  Subsidiaries  shall fail to
         pay any  principal  of,  premium  or  interest  on or any other  amount
         payable  in  respect  of any Debt that is  outstanding  in a  principal
         amount (or, in the case of any Hedge Agreement,  an Agreement Value) of
         at  least  $1,000,000  either  individually  or in the  aggregate  (but
         excluding  Debt  outstanding  hereunder)  of such  Loan  Party  or such
         Subsidiary  (as the case may be), when the same becomes due and payable
         (whether by  scheduled  maturity,  required  prepayment,  acceleration,
         demand or otherwise); or any other event shall occur or condition shall
         exist under any agreement or  instrument  relating to any such Debt, if
         the effect of such event or  condition is to  accelerate,  or to permit
         the acceleration of, the maturity of such Debt or



<PAGE>   132


                                      126

         otherwise to cause, or to permit the holder thereof to cause, such Debt
         to mature;  or any such Debt shall be declared to be due and payable or
         required to be prepaid or redeemed (other than by a regularly scheduled
         required prepayment or redemption),  purchased or defeased, or an offer
         to prepay,  redeem,  purchase or defease such Debt shall be required to
         be made, in each case prior to the stated maturity thereof; or

                  (f) any Loan Party or any of its Subsidiaries  shall generally
         not pay its debts as such debts  become  due, or shall admit in writing
         its  inability  to pay its  debts  generally,  or shall  make a general
         assignment  for the benefit of creditors;  or any  proceeding  shall be
         instituted  by or  against  any Loan  Party or any of its  Subsidiaries
         seeking  to  adjudicate   it  a  bankrupt  or  insolvent,   or  seeking
         liquidation,  winding  up,  reorganization,   arrangement,  adjustment,
         protection,  relief,  or  composition  of it or its debts under any law
         relating  to  bankruptcy,  insolvency  or  reorganization  or relief of
         debtors, or seeking the entry of an order for relief or the appointment
         of a receiver,  trustee,  or other  similar  official for it or for any
         substantial  part  of its  property  and,  in  the  case  of  any  such
         proceeding  instituted  against it (but not  instituted  by it) that is
         being diligently  contested by it in good faith, either such proceeding
         shall remain  undismissed or unstayed for a period of 30 days or any of
         the actions sought in such proceeding  (including,  without limitation,
         the entry of an order  for  relief  against,  or the  appointment  of a
         receiver,  trustee,  custodian or other similar official for, it or any
         substantial part of its property) shall occur; or any Loan Party or any
         of its Subsidiaries shall take any corporate action to authorize any of
         the actions set forth above in this subsection (f); or

                  (g) one or more  judgments  or orders for the payment of money
         in excess of $1,500,000 in the aggregate shall be rendered  against any
         Loan  Party  or any of its  Subsidiaries  and  either  (i)  enforcement
         proceedings  shall  have  been  commenced  by any  creditor  upon  such
         judgments or orders or (ii) there shall be any period of 15 consecutive
         days during which a stay of enforcement of such judgments or orders, by
         reason of a pending appeal or otherwise,  shall not be in effect unless
         such  judgments or orders are covered by a valid and binding  policy of
         insurance  covering  payment  thereof and the  insurer,  which shall be
         rated at least "A" by A. M. Best  Company has  acknowledged  in writing
         responsibility for the full payment of such judgments or orders; or

                  (h) one or more  non-monetary  judgments  or  orders  shall be
         rendered against any Loan Party or any of its Subsidiaries that are, in
         the aggregate, reasonably likely to have a Material Adverse Effect, and
         there shall be any period of 10 consecutive days during which a stay of
         enforcement of such judgments or orders,  by reason of a pending appeal
         or otherwise, shall not be in effect; or

                  (i) any provision of any Loan Document after delivery  thereof
         pursuant to Section  3.01 or 5.01(j)  shall for any reason  cease to be
         valid and binding on or enforceable


<PAGE>   133


                                       127

         in any material respect against any Loan Party party to it, or any such
         Loan Party shall so state in writing; or

                  (j) any Collateral Document after delivery thereof pursuant to
         Section 3.01 or 5.01(j)  shall for any reason  (other than  pursuant to
         the terms thereof) cease to create a valid and perfected first priority
         lien on and security interest in the Collateral purported to be covered
         thereby in any material respect; or

                  (k)      a Change of Control shall occur; or

                  (l)   (i)   Immediately   after    Wheeling-Pittsburgh   Steel
         Corporation  ceases to be an ERISA Affiliate (the "WP Spinoff"),  as to
         any Plan as to which immediately after the WP Spinoff any Loan Party or
         any ERISA  Affiliate is deemed to be an  "employer"  under  ERISA,  the
         funded current liability  percentage (as defined in ERISA) of such Plan
         is less than 90% or the  unfunded  current  liability  (as  defined  in
         ERISA) exceeds $20,000,000 or (ii) any Loan Party shall incur liability
         in excess of  $20,000,000  with respect to any pension plan as a result
         of the WP Spinoff; or

                  (m) any ERISA Event shall have occurred with respect to a Plan
         and the sum  (determined  as of the date of  occurrence  of such  ERISA
         Event) of the  Insufficiency of such Plan and the  Insufficiency of any
         and all other  Plans with  respect to which an ERISA  Event  shall have
         occurred  and then exist (or the  liability of the Loan Parties and the
         ERISA  Affiliates  related to such ERISA Event) exceeds  $4,000,000 and
         any Loan Party or any ERISA Affiliate  could  reasonably be expected to
         incur liability in such amount; provided, however, that a WP Spinoff or
         any transaction occurring in connection therewith shall not be an ERISA
         Event under clause (a), (d) or (e) of the definition of ERISA Event for
         purposes of this subsection (m); or

                  (n) any Loan  Party or any  ERISA  Affiliate  shall  have been
         notified by the sponsor of a  Multiemployer  Plan that it has  incurred
         Withdrawal Liability to such Multiemployer Plan in an amount that, when
         aggregated with all other amounts  required to be paid to Multiemployer
         Plans  by the Loan  Parties  and the  ERISA  Affiliates  as  Withdrawal
         Liability  (determined  as of the date of such  notification),  exceeds
         $4,000,000 or requires payments exceeding $1,000,000 per annum; or

                  (o) any Loan  Party or any  ERISA  Affiliate  shall  have been
         notified by the sponsor of a Multiemployer Plan that such Multiemployer
         Plan is in reorganization or is being terminated, within the meaning of
         Title  IV  of  ERISA,  and  as  a  result  of  such  reorganization  or
         termination the aggregate annual  contributions of the Loan Parties and
         the  ERISA  Affiliates  to all  Multiemployer  Plans  that  are then in
         reorganization  or being terminated have been or will be increased over
         the amounts contributed to such



<PAGE>   134


                                       128

         Multiemployer  Plans  for the plan  years of such  Multiemployer  Plans
         immediately  preceding  the plan year in which such  reorganization  or
         termination occurs by an amount exceeding $4,000,000; or

                  (p) an "Event of Default" (as defined in any  Mortgage)  shall
         have occurred and be continuing;

then, and in any such event, the Administrative  Agent (i) shall at the request,
or may with the consent,  of the Required  Lenders,  by notice to the Borrowers,
declare the  Commitments  of each Lender Party and the obligation of each Lender
Party to make Advances  (other than Letter of Credit Advances by an Issuing Bank
or a Revolving Credit Lender pursuant to Section 2.03(c) and Swing Line Advances
by a Revolving Credit Lender pursuant to Section 2.02(b)), of each Multicurrency
Lender to accept or purchase  Bankers'  Acceptances  and of each Issuing Bank to
issue Letters of Credit to be  terminated,  whereupon  the same shall  forthwith
terminate,  and (ii)  shall at the  request,  or may  with the  consent,  of the
Required  Lenders,  (A) by notice  to the  Borrowers,  declare  the  Notes,  all
interest  thereon and all other  amounts  payable  under this  Agreement and the
other Loan Documents to be forthwith due and payable,  whereupon the Notes,  all
such  interest  and all such  amounts  shall  become  and be  forthwith  due and
payable, without presentment, demand, protest or further notice of any kind, all
of which are hereby  expressly  waived by each  Borrower,  (B) by notice to each
party  required under the terms of any agreement in support of which a Letter of
Credit is issued,  request that all Obligations under such agreement be declared
to be due and  payable  and (C) by  notice to each  Issuing  Bank,  direct  such
Issuing Bank to deliver a Default  Termination Notice to the beneficiary of each
Letter of Credit  issued by it, and each Issuing Bank shall deliver such Default
Termination Notices; provided, however, that in the event of an actual or deemed
entry of an order for relief  with  respect to any  Borrower  under the  Federal
Bankruptcy  Code, (x) the Commitments of each Lender Party and the obligation of
each Lender Party to make Advances  (other than Letter of Credit  Advances by an
Issuing Bank or a Revolving  Credit Lender pursuant to Section 2.03(c) and Swing
Line Advances by a Revolving Credit Lender pursuant to Section 2.02(b)), of each
Multicurrency  Lender to accept or  purchase  Bankers'  Acceptances  and of each
Issuing Bank to issue Letters of Credit shall  automatically  be terminated  and
(y) the Notes, all such interest and all such amounts shall automatically become
and be due and payable,  without presentment,  demand,  protest or any notice of
any kind, all of which are hereby expressly waived by each Borrower.

                  SECTION 6.02.  Actions in Respect of the Letters of Credit and
Bankers'  Acceptances upon Default.  If any Event of Default shall have occurred
and be continuing,  the Administrative Agent may, or shall at the request of the
Required  Lenders,  irrespective  of  whether  it is taking  any of the  actions
described in Section 6.01 or otherwise, (a) make demand upon the Company to, and
forthwith  upon such demand the Company  will,  pay to the  Collateral  Agent on
behalf of the Lender Parties in same day funds at the Collateral  Agent's office
designated in such demand,  for deposit in the L/C Cash Collateral  Account,  an
amount equal to the aggregate



<PAGE>   135


                                       129

Available  Amount of all Letters of Credit then  outstanding and (b) make demand
upon the Canadian  Borrower to, and  forthwith  upon such demand,  such Borrower
will, pay to the Administrative Agent on behalf of the Multicurrency  Lenders in
same day funds at the  Administrative  Agent's office designated in such demand,
for deposit in the  Canadian  Cash  Collateral  Account,  an amount equal to the
aggregate Face Amount of all Bankers'  Acceptances then  outstanding.  If at any
time the Administrative  Agent or the Collateral Agent determines that any funds
held in the L/C Cash Collateral Account or the Canadian Cash Collateral Account,
as the case may be, are  subject to any right or claim of any Person  other than
the Agents and the Lender Parties or that the total amount of such funds is less
than the  aggregate  Available  Amount of all Letters of Credit or the aggregate
Face Amount of all  outstanding  Bankers'  Acceptances,  as the case may be, the
Company  will,  forthwith  upon  demand  by  the  Administrative  Agent  or  the
Collateral  Agent,  (x) pay to the Collateral  Agent, as additional  funds to be
deposited and held in the L/C Cash  Collateral  Account,  an amount equal to the
excess of (a) such  aggregate  Available  Amount  over (b) the  total  amount of
funds,  if  any,  then  held  in  the  L/C  Cash  Collateral  Account  that  the
Administrative  Agent or the Collateral Agent, as the case may be, determines to
be free and clear of any such right and claim and (y) pay to the  Administrative
Agent,  as  additional  funds  to be  deposited  and held in the  Canadian  Cash
Collateral  Account,  an amount equal to the excess of (i) such  aggregate  Face
Amount of all  outstanding  Bankers'  Acceptances  over (ii) the total amount of
funds,  if any,  then held in the  Canadian  Cash  Collateral  Account  that the
Administrative  Agent or the Collateral Agent determines to be free and clear of
any such  right  and  claim.  Upon the  drawing  of any  Letter of Credit or the
maturity of any  Banker's  Acceptance  for which funds are on deposit in the L/C
Cash  Collateral  Account or the Canadian Cash  Collateral  Account,  such funds
shall be applied to  reimburse  the  relevant  Issuing  Bank,  Revolving  Credit
Lenders or  Multicurrency  Lenders,  as applicable,  to the extent  permitted by
applicable law.


                                   ARTICLE VII

                                COMPANY GUARANTY

                  SECTION 7.01. Guaranty. The Company hereby unconditionally and
irrevocably  guarantees  the  punctual  payment  when  due,  whether  at  stated
maturity,  by  acceleration  or otherwise,  of all  obligations  of each Foreign
Borrower  now or  hereafter  existing  under  this  Agreement  or any other Loan
Document,  whether for principal,  interest,  fees,  expenses or otherwise (such
obligations,  to the extent not paid by such  Foreign  Borrower or  specifically
waived in accordance with Section 9.01, being the "Guaranteed Obligations"), and
agrees  to pay any and all  expenses  (including  reasonable  counsel  fees  and
expenses) incurred by the  Administrative  Agent or the Lenders in enforcing any
rights under this Article VII ("this Guaranty"). Without limiting the generality
of the  foregoing,  the  Company's  liability  shall  extend to all amounts that
constitute  part of the Guaranteed  Obligations and would be owed by any Foreign
Borrower to the  Administrative  Agent or any Lender under this Agreement or any
other



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Loan Agreement but for the fact that they are unenforceable or not allowable due
to the existence of a bankruptcy, reorganization or similar proceeding involving
any Foreign Borrower.

                  SECTION 7.02.  Guaranty Absolute.  The Company guarantees that
the Guaranteed Obligations will be paid strictly in accordance with the terms of
this Agreement and the other Loan Documents,  regardless of any law,  regulation
or order now or hereafter in effect in any  jurisdiction  affecting  any of such
terms or the rights of the  Administrative  Agent or the  Lenders  with  respect
thereto.  The  obligations of the Company under this Guaranty are independent of
the Guaranteed Obligations,  and a separate action or actions may be brought and
prosecuted against the Company to enforce this Guaranty, irrespective of whether
any action is brought  against  any  Foreign  Borrower  or whether  any  Foreign
Borrower is joined in any such action or actions.  The  liability of the Company
under  this  Guaranty   shall  be   irrevocable,   absolute  and   unconditional
irrespective of, and the Company hereby  irrevocably  waives any defenses it may
now or hereafter have in any way relating to, any or all of the following:

                  (a)      any  lack  of  validity  or  enforceability  of  this
         Agreement,  any other Loan  Document  or any  agreement  or  instrument
         relating thereto;

                  (b) any change in the time,  manner or place of payment of, or
         in any other term of, all or any of the Guaranteed Obligations,  or any
         other  amendment  or waiver of or any  consent to  departure  from this
         Agreement or any other Loan Document,  including,  without  limitation,
         any increase in the Guaranteed Obligations resulting from the extension
         of additional credit to any Foreign Borrower or otherwise;

                  (c) any taking,  exchange,  release or  non-perfection  of any
         collateral, or any taking, release or amendment or waiver of or consent
         to departure from any other guaranty,  for all or any of the Guaranteed
         Obligations;

                  (d)      any  change,  restructuring  or  termination  of  the
         corporate structure or existence of any Foreign Borrower; or

                  (e) any other circumstance (including, without limitation, any
         statute  of  limitations)  or  any  existence  of or  reliance  on  any
         representation  by the  Administrative  Agent or any Lender  that might
         otherwise  constitute a defense  available  to, or a discharge  of, the
         Company, any Foreign Borrower or any other guarantor or surety.

This Guaranty shall  continue to be effective or be reinstated,  as the case may
be, if at any time any payment of any of the Guaranteed Obligations is rescinded
or must otherwise be returned by the Administrative Agent or any Lender upon the
insolvency,  bankruptcy or  reorganization of any Foreign Borrower or otherwise,
all as though such payment had not been made.




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                                       131

                  SECTION 7.03.  Waiver.  The Company hereby waives  promptness,
diligence,  notice of acceptance and any other notice with respect to any of the
Guaranteed   Obligations  and  this  Guaranty  and  any  requirement   that  the
Administrative  Agent or any Lender exhaust any right or take any action against
any  Foreign  Borrower  or any  other  Person  or any  collateral.  The  Company
acknowledges  that it  will  receive  direct  and  indirect  benefits  from  the
financing arrangements contemplated herein and that the waiver set forth in this
Section 7.03 is knowingly made in  contemplation  of such benefits.  The Company
hereby  waives any right to revoke this  Guaranty,  and  acknowledges  that this
Guaranty  is  continuing  in nature and applies to all  Guaranteed  Obligations,
whether existing now or in the future.

                  SECTION 7.04. Continuing Guaranty;  Assignments. This Guaranty
is a continuing guaranty and shall (a) remain in full force and effect until the
later of the cash payment in full of the  Guaranteed  Obligations  and all other
amounts  payable under this Guaranty and the  Termination  Date,  (b) be binding
upon the Company, its successors and assigns and (c) inure to the benefit of and
be enforceable by the Lenders,  the  Administrative  Agent and their successors,
transferees and assigns. Without limiting the generality of the foregoing clause
(c),  any Lender  may assign or  otherwise  transfer  all or any  portion of its
rights and obligations  hereunder  (including,  without  limitation,  all or any
portion of its Commitments,  the Advances owing to it and the Note or Notes held
by it) to any other Person,  and such other Person shall thereupon become vested
with all the  benefits  in  respect  thereof  granted to such  Lender  herein or
otherwise, in each case as provided in Section 9.07.

                  SECTION 7.05.  Subrogation.  The Company will not exercise any
rights that it may now or hereafter  acquire against any Foreign Borrower or any
other insider guarantor that arise from the existence,  payment,  performance or
enforcement  of the  Company's  obligations  under  this  Agreement,  including,
without  limitation,  any  right  of  subrogation,  reimbursement,  exoneration,
contribution  or  indemnification  and any right to  participate in any claim or
remedy of the  Administrative  Agent or any Lender against a Foreign Borrower or
any other insider guarantor or any collateral, whether or not such claim, remedy
or right arises in equity or under contract,  statute or common law,  including,
without limitation,  the right to take or receive from a Foreign Borrower or any
other insider guarantor, directly or indirectly, in cash or other property or by
set-off or in any other  manner,  payment or security  solely on account of such
claim, remedy or right,  unless and until all of the Guaranteed  Obligations and
all other amounts  payable  under this Guaranty  shall have been paid in full in
cash and the Termination  Date shall have occurred.  If any amount shall be paid
to the Company in violation of the  preceding  sentence at any time prior to the
later of the payment in full in cash of the Guaranteed Obligations and all other
amounts payable under this Guaranty and the Termination  Date, such amount shall
be held in trust for the benefit of the Administrative Agent and the Lenders and
shall forthwith be paid to the  Administrative  Agent to be credited and applied
to the Guaranteed Obligations and all other amounts payable under this Guaranty,
whether matured or unmatured, in accordance with the terms of this Agreement, or
to be held as collateral for any Guaranteed Obligations or other



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                                       132

amounts payable under this Guaranty thereafter arising. If (i) the Company shall
make payment to the Administrative Agent or any Lender of all or any part of the
Guaranteed  Obligations,  (ii) all of the Guaranteed  Obligations  and all other
amounts  payable under this Guaranty shall be paid in full in cash and (iii) the
Termination Date shall have occurred,  the Administrative  Agent and the Lenders
will, at the Company's  request and expense,  execute and deliver to the Company
appropriate documents,  without recourse and without representation or warranty,
necessary to evidence the transfer by  subrogation to the Company of an interest
in the Guaranteed Obligations resulting from such payment by the Company.


                                  ARTICLE VIII

                                   THE AGENTS

                  SECTION 8.01.  Authorization and Action. Each Lender Party (in
its capacities as a Lender, the Swing Line Bank (if applicable), an Issuing Bank
(if  applicable)  and on behalf of itself and its Affiliates as potential  Hedge
Banks) hereby appoints and authorizes each Agent to take such action as agent on
its behalf and to exercise such powers and  discretion  under this Agreement and
the other Loan  Documents as are delegated to such Agent by the terms hereof and
thereof,  together with such powers and discretion as are reasonably  incidental
thereto.  As to any matters not  expressly  provided  for by the Loan  Documents
(including,  without  limitation,  enforcement  or collection of the Notes),  no
Agent shall be required to exercise any discretion or take any action, but shall
be required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the instructions of the Required Lenders,
and such  instructions  shall be binding upon all Lender Parties and all holders
of Notes; provided,  however, that no Agent shall be required to take any action
that  exposes  such Agent to  personal  liability  or that is  contrary  to this
Agreement  or  applicable  law.  Each Agent  agrees to give to each Lender Party
prompt  notice of each notice given to it by any Borrower  pursuant to the terms
of this Agreement.

                  SECTION 8.02. Agents' Reliance, Etc. Neither any Agent nor any
of their respective directors, officers, agents or employees shall be liable for
any action  taken or  omitted  to be taken by it or them under or in  connection
with the Loan Documents, except for its or their own gross negligence or willful
misconduct.  Without limitation of the generality of the foregoing,  each Agent:
(a) may treat the payee of any Note as the holder thereof until,  in the case of
the  Administrative  Agent,  the  Administrative  Agent  receives and accepts an
Assignment and  Acceptance  entered into by the Lender that is the payee of such
Note, as assignor, and an Eligible Assignee, as assignee, or, in the case of any
other Agent, such Agent has received notice from the  Administrative  Agent that
it has received and accepted such  Assignment  and  Acceptance,  in each case as
provided in Section 9.07; (b) may consult with legal counsel  (including counsel
for any Loan Party),  independent  public accountants and other experts selected
by it and shall not be


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                                       133

liable  for any  action  taken or  omitted  to be  taken in good  faith by it in
accordance with the advice of such counsel, accountants or experts; (c) makes no
warranty or  representation  to any Lender Party and shall not be responsible to
any Lender Party for any  statements,  warranties  or  representations  (whether
written or oral) made in or in connection with the Loan Documents; (d) shall not
have any duty to ascertain or to inquire as to the  performance or observance of
any of the  terms,  covenants  or  conditions  (other  than,  in the case of the
Administrative  Agent,  reasonable  care in  respect  of the  delivery  of items
required by Section  3.01 or 3.02) of any Loan  Document on the part of any Loan
Party or to inspect the property  (including  the books and records) of any Loan
Party;  (e) shall not be  responsible to any Lender Party for the due execution,
legality, validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security  interest created or purported to
be  created  under  or in  connection  with,  any  Loan  Document  or any  other
instrument  or  document  furnished  pursuant  thereto;  and (f) shall  incur no
liability  under or in respect of any Loan  Document  by acting upon any notice,
consent,  certificate or other  instrument or writing (which may be by telegram,
telecopy or telex) reasonably believed by it to be genuine and signed or sent by
the proper party or parties.

                  SECTION  8.03.  Citicorp and  Affiliates.  With respect to its
Commitments,  the Advances made by it and the Notes issued to it, Citicorp shall
have the same rights and powers  under the Loan  Documents  as any other  Lender
Party and may  exercise  the same as  though it were not an Agent;  and the term
"Lender Party" or "Lender Parties" shall, unless otherwise expressly  indicated,
include  Citicorp in its  individual  capacity.  Citicorp and its affiliates may
accept deposits from, lend money to, act as trustee under  indentures of, accept
investment banking engagements from and generally engage in any kind of business
with,  any  Loan  Party,  any of its  Subsidiaries  and any  Person  that may do
business with or own securities of any Loan Party or any such Subsidiary, all as
if Citicorp  were not an Agent and  without any duty to account  therefor to the
Lender Parties.

                  SECTION 8.04. Lender Party Credit Decision.  Each Lender Party
acknowledges  that it has,  independently and without reliance upon any Agent or
any other  Lender  Party and based on the  financial  statements  referred to in
Section  4.01  and  such  other  documents  and  information  as it  has  deemed
appropriate,  made its own  credit  analysis  and  decision  to enter  into this
Agreement.  Each Lender Party also acknowledges that it will,  independently and
without  reliance  upon any  Agent or any other  Lender  Party and based on such
documents and information as it shall deem appropriate at the time,  continue to
make its own  credit  decisions  in  taking  or not  taking  action  under  this
Agreement.

                  SECTION 8.05. Indemnification. (a) Each Lender Party severally
agrees to  indemnify  each Agent (to the extent not promptly  reimbursed  by the
Borrowers)  from and against such Lender  Party's  ratable share  (determined as
provided  below)  of any  and all  liabilities,  obligations,  losses,  damages,
penalties,  actions,  judgments,  suits, costs, expenses or disbursements of any
kind or nature  whatsoever  that may be imposed  on,  incurred  by, or  asserted
against such



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                                       134

Agent in any way relating to or arising out of the Loan  Documents or any action
taken or omitted by such Agent under the Loan Documents; provided, however, that
no  Lender  Party  shall  be  liable  for  any  portion  of  such   liabilities,
obligations,  losses,  damages,  penalties,  actions,  judgments,  suits, costs,
expenses or  disbursements  resulting  from such  Agent's  gross  negligence  or
willful  misconduct as found in a final,  non-appealable  judgment by a court of
competent jurisdiction.  Without limitation of the foregoing,  each Lender Party
agrees to reimburse each Agent promptly upon demand for its ratable share of any
costs and expenses (including, without limitation,  reasonable fees and expenses
of counsel) payable by the Borrowers under Section  9.04(a),  to the extent that
such  Agent is not  promptly  reimbursed  for such  costs  and  expenses  by the
Borrowers.

                  (b) Each  Lender  Party  severally  agrees to  indemnify  each
Issuing Bank (to the extent not promptly  reimbursed by the Borrowers)  from and
against such Lender Party's ratable share  (determined as provided below) of any
and  all  liabilities,   obligations,   losses,  damages,  penalties,   actions,
judgments,  suits,  costs,  expenses  or  disbursements  of any  kind or  nature
whatsoever that may be imposed on, incurred by, or asserted against such Issuing
Bank in any way  relating to or arising out of the Loan  Documents or any action
taken or  omitted  by such  Issuing  Bank  under the Loan  Documents;  provided,
however,  that  no  Lender  Party  shall  be  liable  for  any  portion  of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs,  expenses or  disbursements  resulting  from such  Issuing  Bank's  gross
negligence or willful misconduct as found in a final, non-appealable judgment by
a court of competent  jurisdiction.  Without  limitation of the foregoing,  each
Lender Party agrees to reimburse  such Issuing Bank promptly upon demand for its
ratable share of any costs and expenses (including, without limitation, fees and
expenses of counsel)  payable by the  Borrowers  under Section  9.04(b),  to the
extent that such  Issuing  Bank is not  promptly  reimbursed  for such costs and
expenses by the Borrowers.

                  (c) For purposes of this  Section  8.05,  the Lender  Parties'
respective  ratable  shares  of any  amount  shall be  determined,  at any time,
according  to the sum of (i) the  aggregate  principal  amount  of the  Advances
outstanding at such time and owing to the respective Lender Parties,  (ii) their
respective Pro Rata Shares of the aggregate  Available  Amount of all Letters of
Credit  outstanding at such time,  (iii) the aggregate  unused portions of their
respective Term A Commitments, Term B Commitments,  Delayed Draw Commitments and
Multicurrency  Commitments  at  such  time  and  (iv)  their  respective  Unused
Revolving Credit Commitments at such time; provided that the aggregate principal
amount of Swing  Line  Advances  owing to the  Swing  Line Bank and of Letter of
Credit  Advances owing to any Issuing Bank shall be considered to be owed to the
Revolving Credit Lenders ratably in accordance with their  respective  Revolving
Credit  Commitments.  The failure of any Lender Party to reimburse  any Agent or
any Issuing Bank, as the case may be, promptly upon demand for its ratable share
of any amount  required  to be paid by the Lender  Parties to such Agent or such
Issuing Bank, as the case may be, as provided herein shall not relieve any other
Lender Party of its obligation hereunder to reimburse such Agent or such Issuing
Bank, as the case may be, for its ratable share of such amount, but no Lender



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                                       135

Party  shall  be  responsible  for the  failure  of any  other  Lender  Party to
reimburse  such Agent or such Issuing  Bank,  as the case may be, for such other
Lender Party's ratable share of such amount.  Without  prejudice to the survival
of any  other  agreement  of any  Lender  Party  hereunder,  the  agreement  and
obligations  of each Lender Party  contained in this Section 8.05 shall  survive
the  payment  in full of  principal,  interest  and all  other  amounts  payable
hereunder and under the other Loan Documents.

                  SECTION 8.06. Successor Agents. Any Agent may resign as to any
or all of the  Facilities at any time by giving  written  notice  thereof to the
Lender  Parties and the Borrowers and may be removed as to all of the Facilities
at any time with or without cause by the Required Lenders; provided that each of
the  Required  Lenders so acting to remove such Agent shall offer to assume such
Lender's Pro Rata Share of the Revolving Credit  Commitments of such Agent. Upon
any such  resignation or removal,  the Required  Lenders shall have the right to
appoint a successor  Agent as to such of the  Facilities  as to which such Agent
has resigned or been removed. If no successor Agent shall have been so appointed
by the Required  Lenders,  and shall have accepted such  appointment,  within 30
days after the retiring  Agent's giving of notice of resignation or the Required
Lenders'  removal of the retiring Agent,  then the retiring Agent may, on behalf
of the Lender Parties,  appoint a successor  Agent,  which shall be a commercial
bank  organized  under the laws of the United States or of any State thereof and
having  a  combined  capital  and  surplus  of at least  $500,000,000.  Upon the
acceptance of any  appointment as Agent hereunder by a successor Agent as to all
of the Facilities  and, in the case of a successor  Collateral  Agent,  upon the
execution and filing or recording of such  financing  statements,  or amendments
thereto,  and such  amendments or supplements  to the Mortgages,  and such other
instruments  or notices,  as may be necessary or  desirable,  or as the Required
Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents,  such successor Agent shall
succeed to and become vested with all the rights, powers, discretion, privileges
and duties of the retiring  Agent,  and the retiring  Agent shall be  discharged
from its duties and obligations under the Loan Documents. Upon the acceptance of
any  appointment as Agent  hereunder by a successor Agent as to less than all of
the  Facilities  and,  in the case of a  successor  Collateral  Agent,  upon the
execution and filing or recording of such  financing  statements,  or amendments
thereto,  and such  amendments or supplements  to the Mortgages,  and such other
instruments  or notices,  as may be necessary or  desirable,  or as the Required
Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents,  such successor Agent shall
succeed to and become vested with all the rights, powers, discretion, privileges
and duties of the retiring Agent as to such Facilities,  other than with respect
to funds transfers and other similar aspects of the administration of Borrowings
under such  Facilities,  issuances  of Letters  of Credit  (notwithstanding  any
resignation as Agent with respect to the Letter of Credit Facility) and payments
by the Borrowers in respect of such Facilities,  and the retiring Administrative
Agent shall be discharged from its duties and  obligations  under this Agreement
as to such Facilities,  other than as aforesaid. If within 45 days after written
notice is given of the retiring Agent's



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                                       136

resignation  or removal  under this Section  8.06 no successor  Agent shall have
been appointed and shall have accepted such  appointment,  then on such 45th day
(i) the retiring Agent's resignation or removal shall become effective, (ii) the
retiring  Agent shall  thereupon be discharged  from its duties and  obligations
under the Loan Documents and (iii) the Required Lenders shall thereafter perform
all duties of the retiring  Agent under the Loan  Documents  until such time, if
any, as the Required Lenders appoint a successor Agent as provided above.  After
any retiring Agent's  resignation or removal hereunder as Agent as to any of the
Facilities  shall have become  effective,  the  provisions  of this Article VIII
shall inure to its benefit as to any actions  taken or omitted to be taken by it
while it was Agent as to such Facilities under this Agreement.

                  SECTION 8.07.  Sub-Agents.  Each Sub-Agent has been designated
under this  Agreement  to carry out  duties of the  Administrative  Agent.  Each
Sub-Agent  shall be subject to each of the  obligations  in this Agreement to be
performed by the applicable Sub-Agent,  and each of the Borrowers and the Lender
Parties  agrees that each  Sub-Agent  shall be entitled to exercise  each of the
rights and shall be entitled to each of the benefits of the Administrative Agent
under this Agreement as relate to the performance of its obligations hereunder.


                                   ARTICLE IX

                                  MISCELLANEOUS

                  SECTION 9.01.  Amendments,  Etc. (a) No amendment or waiver of
any  provision of this  Agreement or the Notes or any other Loan  Document,  nor
consent  to any  departure  by any Loan Party  therefrom,  shall in any event be
effective unless the same shall be in writing and signed (or, in the case of the
Collateral  Documents,  consented  to) by the  Required  Lenders,  and then such
waiver or consent shall be effective  only in the specific  instance and for the
specific  purpose for which given;  provided,  however,  that (i) no  amendment,
waiver or  consent  shall,  unless in writing  and signed by all of the  Lenders
(other than any Lender Party that is, at such time, a Defaulting Lender), do any
of the  following  at any time:  (A) waive any of the  conditions  specified  in
Section 3.01 or, in the case of the Initial  Extension of Credit,  Section 3.03,
(B) change the number of Lenders or the percentage of (1) the  Commitments,  (2)
the  aggregate  unpaid  principal  amount of the  Advances or (3) the  aggregate
Available  Amount of outstanding  Letters of Credit that, in each case, shall be
required  for the  Lenders  or any of them to take  any  action  hereunder,  (C)
release all or substantially  all of the Guarantors or otherwise limit liability
of all or  substantially  all of the Guarantors  with respect to the Obligations
owing to the Agents and the Lender Parties, (D) release all or substantially all
of the Collateral in any transaction or series of related transactions or permit
the  creation,  incurrence,  assumption  or  existence  of  any  Lien  on all or
substantially  all of the  Collateral  in any  transaction  or series of related
transactions  to secure  any  Obligations  other than  Obligations  owing to the
Secured Parties under the Loan Documents or (E) amend this Section 9.01 and (ii)
no amendment, waiver or consent shall, unless



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                                       137

in writing and signed by the  Required  Lenders and each Lender  (other than any
Lender that is, at such time, a Defaulting  Lender) that has a Commitment  under
the Term A  Facility,  Term B Facility,  Delayed  Draw  Facility,  Multicurrency
Facility or  Revolving  Credit  Facility if such Lender is directly  affected by
such amendment,  waiver or consent,  (A) increase the Commitments of such Lender
or subject such Lender to any additional  obligations,  (B) reduce the principal
of, or interest  on, the Notes held by such Lender or any fees or other  amounts
payable hereunder to such Lender, (C) postpone any date fixed for any payment of
principal of, or interest on, the Notes held by such Lender or any fees or other
amounts payable  hereunder to such Lender or (D) change the order of application
of any  prepayment  set forth in  Section  2.07 in any  manner  that  materially
affects  such  Lender;  provided  further  that  the  Collateral  Agent  and the
Administrative  Agent may, without the consent of the Required Lenders,  release
up to 10% of the book  value  of the  Collateral  or  consent  to the  creation,
incurrence,  assumption  or existence of any Lien on up to 10% of the book value
of the Collateral;  provided further that no amendment, waiver or consent shall,
unless in writing and signed by the Swing Line Bank or each Issuing Bank, as the
case may be, in  addition  to the Lenders  required  above to take such  action,
affect the rights or obligations of the Swing Line Bank or of the Issuing Banks,
as the  case  may  be,  under  this  Agreement;  and  provided  further  that no
amendment,  waiver or consent shall, unless in writing and signed by an Agent in
addition to the Lenders required above to take such action, affect the rights or
duties of such Agent under this Agreement or the other Loan Documents.

                  (b) Each  Lender  grants (x) to the  Administrative  Agent the
right to purchase all (but not less than all) of such Lender's  Commitments  and
Advances  owing  to it and  the  Notes  held  by it and  all of its  rights  and
obligations hereunder and under the other Loan Documents at a price equal to the
aggregate amount of outstanding  Advances owed to such Lender (together with all
accrued  and  unpaid  interest  and fees  owed to such  Lender),  and (y) to the
Company the right to cause an  assignment of all (but not less than all) of such
Lender's  Commitments  and Advances owing to it and the Notes held by it and all
of its rights and  obligations  hereunder and under the other Loan  Documents to
Eligible Assignees,  which right may be exercised by the Administrative Agent or
the  Company,  as the  case  may be,  if such  Lender  refuses  to  execute  any
amendment,  waiver or consent  which  requires  the  written  consent of all the
Lenders and to which Lenders owed at least 80% of the aggregate unpaid principal
amount of Advances or, if no such principal amount is then outstanding,  Lenders
having at least 80% of the Commitments, the Administrative Agent and the Company
have agreed. Each Lender agrees that if the Administrative Agent or the Company,
as the case may be,  exercises its option  hereunder,  it shall promptly execute
and deliver all  agreements  and  documentation  necessary  to  effectuate  such
assignment as set forth in Section 9.07.


                  SECTION   9.02.   Notices,   Etc.   All   notices   and  other
communications   provided  for   hereunder   shall  be  in  writing   (including
telegraphic,   telecopy  or  telex   communication)  and  mailed,   telegraphed,
telecopied,  telexed or  delivered,  if to any Borrower,  at 555 Theodore  Fremd
Avenue,



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                                       138

Rye, New York 10580,  Attention:  Paul Dixon,  with a copy to WHX Corporation at
its  address  at 110 East 59th  Street,  New York,  New York  10022,  Attention:
Stewart E. Tabin;  if to any Initial Lender or any Initial  Issuing Bank, at its
Domestic Lending Office specified  opposite its name on Schedule I hereto; if to
any  other  Lender  Party,  at its  Domestic  Lending  Office  specified  in the
Assignment and Acceptance  pursuant to which it became a Lender Party; if to the
Collateral  Agent, at its address at 399 Park Avenue,  New York, New York 10043,
Attention:  Keith Karako; and if to the Administrative  Agent, at its address at
399 Park Avenue,  New York, New York 10043,  Attention:  Keith Karako; or, as to
any  Borrower or the  Administrative  Agent,  at such other  address as shall be
designated  by such party in a written  notice to the other  parties  and, as to
each other party,  at such other address as shall be designated by such party in
a written notice to the Company and the  Administrative  Agent. All such notices
and communications  shall, when mailed,  telegraphed,  telecopied or telexed, be
effective  when  deposited  in the mails,  delivered to the  telegraph  company,
transmitted by telecopier or confirmed by telex answerback, respectively, except
that notices and  communications to any Agent pursuant to Article II, III or VII
shall  not be  effective  until  received  by such  Agent.  Manual  delivery  by
telecopier  of an  executed  counterpart  of  any  amendment  or  waiver  of any
provision of this Agreement or the Notes or of any Exhibit hereto to be executed
and delivered  hereunder shall be effective as delivery of an original  executed
counterpart thereof.

                  SECTION 9.03. No Waiver;  Remedies.  No failure on the part of
any Lender Party or any Agent to exercise, and no delay in exercising, any right
hereunder  or under any Note shall  operate as a waiver  thereof;  nor shall any
single or  partial  exercise  of any such  right  preclude  any other or further
exercise  thereof  or the  exercise  of any other  right.  The  remedies  herein
provided are cumulative and not exclusive of any remedies provided by law.

                  SECTION  9.04.  Costs and Expenses.  (a) The Borrowers  (other
than the  Canadian  Borrower)  agree  jointly and  severally,  and the  Canadian
Borrower agrees, as to the portion thereof  attributable to it, its property and
to its Borrowing hereunder,  to pay on demand (i) all costs and expenses of each
Agent in connection with the preparation,  execution, delivery,  administration,
modification and amendment of the Loan Documents (including, without limitation,
(A) all due diligence, collateral review, syndication, transportation, computer,
duplication,   appraisal,  audit,  insurance,  consultant,  search,  filing  and
recording fees and expenses and (B) the reasonable  fees and expenses of counsel
for the Administrative Agent with respect thereto, with respect to advising such
Agent as to its rights and  responsibilities,  or the perfection,  protection or
preservation of rights or interests,  under the Loan Documents,  with respect to
negotiations  with any Loan Party or with other  creditors  of any Loan Party or
any  of  its  Subsidiaries   arising  out  of  any  Default  or  any  events  or
circumstances  that may give rise to a Default  and with  respect to  presenting
claims in or otherwise participating in or monitoring any bankruptcy, insolvency
or other  similar  proceeding  involving  creditors'  rights  generally  and any
proceeding   ancillary   thereto)  and  (ii)  all  costs  and  expenses  of  the
Administrative  Agent in connection  with the enforcement of the Loan Documents,
whether in any action, suit or litigation,



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                                       139

or any bankruptcy,  insolvency or other similar proceeding  affecting creditors'
rights  generally  (including,  without  limitation,  the  reasonable  fees  and
expenses of counsel  for the  Administrative  Agent and each  Lender  Party with
respect thereto).

                  (b) The  Borrowers  (other than the Canadian  Borrower)  agree
jointly  and  severally  and the  Canadian  Borrower  agrees,  as to the portion
thereof  attributable  to it,  its  property  or its  Borrowings  hereunder,  to
indemnify  and hold  harmless  each Agent,  each Lender  Party and each of their
Affiliates  and their  respective  officers,  directors,  employees,  agents and
advisors  (each,  an  "Indemnified  Party") from and against any and all claims,
damages,  losses,  liabilities  and  expenses  (including,  without  limitation,
reasonable  fees and expenses of counsel) that may be incurred by or asserted or
awarded  against  any  Indemnified  Party,  in each  case  arising  out of or in
connection with or by reason of (including,  without  limitation,  in connection
with any investigation,  litigation or proceeding or preparation of a defense in
connection  therewith)  (i) the  Facilities,  the actual or proposed  use of the
proceeds of the Advances or the Letters of Credit, the Transaction  Documents or
any of the  transactions  contemplated  thereby  or (ii) the  actual or  alleged
presence of Hazardous  Materials on any property of any Loan Party or any of its
Subsidiaries or any  Environmental  Action relating in any way to any Loan Party
or any of its  Subsidiaries,  except to the extent  such  claim,  damage,  loss,
liability or expense is found in a final,  non-appealable judgment by a court of
competent  jurisdiction  to have  resulted from such  Indemnified  Party's gross
negligence or willful misconduct. In the case of an investigation, litigation or
other  proceeding to which the indemnity in this Section 9.04(b)  applies,  such
indemnity shall be effective  whether or not such  investigation,  litigation or
proceeding  is  brought  by any  Loan  Party,  its  directors,  shareholders  or
creditors or an Indemnified  Party or any Indemnified Party is otherwise a party
thereto  and whether or not the  transactions  contemplated  by the  Transaction
Documents  are  consummated.  Each  Borrower also agrees not to assert any claim
against any Agent, any Lender Party or any of their Affiliates,  or any of their
respective officers, directors,  employees,  attorneys and agents, on any theory
of liability, for special,  indirect,  consequential or punitive damages arising
out of or otherwise  relating to the  Facilities,  the actual or proposed use of
the proceeds of the Advances or the Letters of Credit, the Transaction Documents
or any of the transactions contemplated by the Transaction Documents.

                  (c) If any  payment of  principal  of, or  Conversion  of, any
Eurocurrency  Rate  Advance is made by any  Borrower  to or for the account of a
Lender Party other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion  pursuant to Section 2.07,  2.10(b)(i) or
2.12(d),  acceleration  of the maturity of the Notes pursuant to Section 6.01 or
for any  other  reason,  or if  such  Borrower  fails  to make  any  payment  or
prepayment  or  Conversion  of an Advance  for which a notice of  prepayment  or
Conversion  has been given or that is  otherwise  required  to be made,  whether
pursuant to Section 2.05, 2.07 or 6.01 or otherwise,  such Borrower shall,  upon
demand by such Lender  Party  (with a copy of such demand to the  Administrative
Agent), pay to the Administrative Agent for the account of such Lender Party any
amounts required to compensate such Lender Party for any additional losses,



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                                       140

costs or expenses  that it may  reasonably  incur as a result of such payment or
Conversion  or such  failure  to pay or prepay or  Convert,  as the case may be,
including, without limitation, any loss (including loss of anticipated profits),
cost or  expense  incurred  by  reason of the  liquidation  or  reemployment  of
deposits or other funds  acquired by any Lender  Party to fund or maintain  such
Advance.

                  (d) If any  Loan  Party  fails  to pay  when  due  any  costs,
expenses  or other  amounts  payable by it under any Loan  Document,  including,
without  limitation,  fees and expenses of counsel and indemnities,  such amount
may be paid on  behalf  of such Loan  Party by the  Administrative  Agent or any
Lender Party, in its sole discretion.

                  (e) Without  prejudice to the survival of any other  agreement
of any Loan Party hereunder or under any other Loan Document, the agreements and
obligations  of the  Borrowers  contained  in  Sections  2.12  and 2.14 and this
Section 9.04 shall  survive the payment in full of  principal,  interest and all
other amounts payable hereunder and under any of the other Loan Documents.

                  SECTION 9.05.  Right of Set-off.  Upon (a) the  occurrence and
during the continuance of any Event of Default and (b) the making of the request
or the  granting of the  consent  specified  by Section  6.01 to  authorize  the
Administrative  Agent to  declare  the Notes  due and  payable  pursuant  to the
provisions of Section  6.01,  each Agent and each Lender Party and each of their
respective Affiliates is hereby authorized at any time and from time to time, to
the fullest extent  permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand,  provisional or final) at any time
held and other  indebtedness at any time owing by such Agent,  such Lender Party
or such  Affiliate to or for the credit or the account of any  Borrower  against
any and all of the Obligations of such Borrower now or hereafter  existing under
the Loan  Documents,  irrespective  of whether  such Agent or such Lender  Party
shall  have  made any  demand  under  this  Agreement  or such Note or Notes and
although such  obligations  may be  unmatured.  Each Agent and each Lender Party
agrees promptly to notify such Borrower after any such set-off and  application;
provided,  however,  that the failure to give such  notice  shall not affect the
validity  of such  set-off  and  application.  The rights of each Agent and each
Lender Party and their respective  Affiliates under this Section are in addition
to other rights and remedies  (including,  without  limitation,  other rights of
set-off) that such Agent, such Lender Party and their respective  Affiliates may
have.

                  SECTION 9.06.  Binding  Effect.  This  Agreement  shall become
effective  when it shall have been  executed by each Borrower and each Agent and
the  Administrative  Agent shall have been  notified by each Initial  Lender and
each Initial Issuing Bank that such Initial Lender and such Initial Issuing Bank
has executed it and thereafter shall be binding upon and inure to the benefit of
each Borrower,  each Agent and each Lender Party and their respective successors
and



<PAGE>   147


                                       141

assigns,  except  that no  Borrower  shall  have the right to assign  its rights
hereunder or any interest herein without the prior written consent of the Lender
Parties.

                  SECTION 9.07. Assignments and Participations.  (a) Each Lender
may, and, if demanded by the Company and the  Administrative  Agent  pursuant to
Section  9.01(b) with respect to any amendment  requiring  consent of all of the
Lenders as to which such Lender shall not have consented, will, assign to one or
more  Eligible  Assignees all or a portion of its rights and  obligations  under
this  Agreement  (including,  without  limitation,  all  or  a  portion  of  its
Commitment or  Commitments,  the Advances owing to it and the Note or Notes held
by it); provided,  however, that (i) each such assignment shall be of a uniform,
and not a varying, percentage of all rights and obligations under and in respect
of one or more Facilities,  (ii) except in the case of an assignment to a Person
that,  immediately prior to such assignment,  was a Lender or in the case of any
Multicurrency Lender, an Affiliate of such Multicurrency Lender or an assignment
of all of a Lender's rights and obligations  under this Agreement or in the case
of an assignment of Term Loan B, all of a Lender's rights and obligations  under
the Term Loan B Facility, the aggregate amount of the Commitments being assigned
to such Eligible Assignee pursuant to such assignment (determined as of the date
of the Assignment and Acceptance  with respect to such  assignment)  shall in no
event be less than  $5,000,000  or an integral  multiple of $1,000,000 in excess
thereof,  (iii) each such assignment shall be to an Eligible  Assignee,  (iv) no
such  assignment  shall be permitted  without the consent of the  Administrative
Agent until the Administrative Agent shall have notified the Lender Parties that
syndication  of the  Commitments  hereunder  has  been  completed,  (v) no  such
assignments  shall be  permitted  without  the  consent of the  Company  and the
Administrative  Agent to any Lender that would be entitled to demand  additional
payments  pursuant to Section 2.12 or 2.14 if such payments were not required to
be made to the assigning Lender immediately prior to such assignment,  (vi) each
such assignment made as a result of a demand by the Company shall be arranged by
the Company after consultation with the Administrative Agent and shall be either
an assignment of all of the rights and obligations of the assigning Lender under
this Agreement or an assignment of a portion of such rights and obligations made
concurrently  with  another  such  assignment  or other  such  assignments  that
together cover all of the rights and  obligations of the assigning  Lender under
this  Agreement,  (vii) no Lender shall be obligated to make any such assignment
as a result of a demand by the Company  unless and until such Lender  shall have
received one or more  payments  from either the Company or one or more  Eligible
Assignees in an  aggregate  amount at least equal to the  aggregate  outstanding
principal  amount of the Advances  owing to such Lender,  together  with accrued
interest  thereon to the date of payment of such principal and all other amounts
payable to such Lender under this  Agreement and (viii) the parties to each such
assignment  shall  execute  and  deliver to the  Administrative  Agent,  for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with  any  Note  or  Notes  subject  to such  assignment  and a  processing  and
recordation fee of $3,500.



<PAGE>   148


                                       142

                  (b) Upon such execution,  delivery,  acceptance and recording,
from and after the effective date specified in such  Assignment and  Acceptance,
(i) the  assignee  thereunder  shall be a party  hereto  and, to the extent that
rights and  obligations  hereunder  have been  assigned  to it  pursuant to such
Assignment  and  Acceptance,  have the  rights  and  obligations  of a Lender or
Issuing Bank, as the case may be,  hereunder and (ii) the Lender or Issuing Bank
assignor  thereunder shall, to the extent that rights and obligations  hereunder
have been assigned by it pursuant to such Assignment and Acceptance,  relinquish
its rights  (other than its rights  under  Sections  2.12,  2.14 and 9.04 to the
extent  any  claim  thereunder  relates  to  an  event  arising  prior  to  such
assignment) and be released from its  obligations  under this Agreement (and, in
the case of an Assignment and Acceptance  covering all of the remaining  portion
of an assigning  Lender's or Issuing  Bank's rights and  obligations  under this
Agreement, such Lender or Issuing Bank shall cease to be a party hereto).

                  (c) By executing and delivering an Assignment and  Acceptance,
each Lender Party assignor  thereunder and each assignee  thereunder  confirm to
and agree with each other and the other  parties  thereto and hereto as follows:
(i) other than as provided in such  Assignment  and  Acceptance,  such assigning
Lender Party makes no  representation  or warranty and assumes no responsibility
with respect to any  statements,  warranties  or  representations  made in or in
connection  with  any  Loan  Document  or  the  execution,  legality,  validity,
enforceability,  genuineness,  sufficiency  or value  of, or the  perfection  or
priority of any lien or security  interest  created or  purported  to be created
under or in  connection  with,  any Loan  Document  or any other  instrument  or
document furnished  pursuant thereto;  (ii) such assigning Lender Party makes no
representation  or warranty  and assumes no  responsibility  with respect to the
financial  condition of any Loan Party or the  performance  or observance by any
Loan  Party of any of its  obligations  under  any Loan  Document  or any  other
instrument or document furnished pursuant thereto;  (iii) such assignee confirms
that it has  received  a copy of this  Agreement,  together  with  copies of the
financial  statements  referred to in Section 4.01 and such other  documents and
information  as it has deemed  appropriate  to make its own credit  analysis and
decision to enter into such Assignment and Acceptance;  (iv) such assignee will,
independently  and without reliance upon any Agent,  such assigning Lender Party
or any other  Lender Party and based on such  documents  and  information  as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this  Agreement;  (v) such  assignee  confirms
that it is an Eligible Assignee; (vi) such assignee appoints and authorizes each
Agent to take such action as agent on its behalf and to exercise such powers and
discretion  under the Loan Documents as are delegated to such Agent by the terms
hereof and thereof,  together with such powers and  discretion as are reasonably
incidental  thereto;  and (vii) such  assignee  agrees  that it will  perform in
accordance  with their  terms all of the  obligations  that by the terms of this
Agreement are required to be performed by it as a Lender or Issuing Bank, as the
case may be.

                  (d) The  Administrative  Agent,  acting for this  purpose (but
only for this purpose) as the agent of the Company shall maintain at its address
referred to in Section 9.02 a



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                                       143

copy of each  Assignment  and  Acceptance  delivered to and accepted by it and a
register for the  recordation  of the names and addresses of the Lender  Parties
and the Commitment  under each Facility of, and principal amount of the Advances
owing  under  each  Facility  to,  each  Lender  Party  from  time to time  (the
"Register"). The entries in the Register shall be conclusive and binding for all
purposes,  absent manifest error,  and the Borrowers,  the Agents and the Lender
Parties  shall  treat each Person  whose name is  recorded in the  Register as a
Lender Party hereunder for all purposes of this Agreement. The Register shall be
available for  inspection by any Borrower or any Lender Party at any  reasonable
time and from time to time upon reasonable prior notice.

                  (e) Upon its receipt of an Assignment and Acceptance  executed
by an assigning  Lender Party and an assignee,  together  with any Note or Notes
subject to such assignment,  the Administrative  Agent shall, if such Assignment
and Acceptance has been completed and is in substantially  the form of Exhibit C
hereto,  (i) accept such Assignment and Acceptance,  (ii) record the information
contained  therein in the Register and (iii) give prompt  notice  thereof to the
applicable  Borrowers and each other Agent.  In the case of any  assignment by a
Lender,  within  five  Business  Days  after its  receipt  of such  notice,  the
applicable  Borrower,  at its own  expense,  shall  execute  and  deliver to the
Administrative Agent in exchange for the surrendered Note or Notes a new Note to
the order of such Eligible Assignee in an amount equal to the Commitment assumed
by it under each Facility pursuant to such Assignment and Acceptance and, if any
assigning Lender has retained a Commitment  hereunder under such Facility, a new
Note to the order of such assigning  Lender in an amount equal to the Commitment
retained  by it  hereunder.  Such  new Note or  Notes  shall be in an  aggregate
principal  amount equal to the aggregate  principal  amount of such  surrendered
Note or  Notes,  shall  be  dated  the  effective  date of such  Assignment  and
Acceptance and shall otherwise be in substantially the form of Exhibit A-1, A-2,
A-3, A-4 or A-5 hereto, as the case may be.

                  (f) Each  Issuing  Bank  may  assign  to one or more  Eligible
Assignees  all or a portion  of its  rights and  obligations  under the  undrawn
portion of its Letter of Credit Commitment at any time; provided,  however, that
(i) except in the case of an  assignment to a Person that  immediately  prior to
such assignment was an Issuing Bank or an assignment of all of an Issuing Bank's
rights and obligations under this Agreement,  the amount of the Letter of Credit
Commitment of the assigning  Issuing Bank being  assigned  pursuant to each such
assignment  (determined as of the date of the  Assignment  and  Acceptance  with
respect to such assignment)  shall in no event be less than $5,000,000 and shall
be in an  integral  multiple of  $1,000,000  in excess  thereof,  (ii) each such
assignment  shall be to an Eligible  Assignee and (iii) the parties to each such
assignment  shall  execute  and  deliver to the  Administrative  Agent,  for its
acceptance and recording in the Register, an Assignment and Acceptance, together
with a processing and recordation fee of $3,500.

                  (g) Each Lender Party may sell  participations  to one or more
Persons  (other than any Loan Party or any of its  Affiliates) in or to all or a
portion of its rights and obligations



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                                       144

under this Agreement  (including,  without  limitation,  all or a portion of its
Commitments,  the  Advances  owing to it and the Note or Notes  (if any) held by
it);  provided,  however,  that (i) such Lender Party's  obligations  under this
Agreement  (including,   without  limitation,   its  Commitments)  shall  remain
unchanged,  (ii) such Lender Party shall remain solely  responsible to the other
parties hereto for the performance of such obligations,  (iii) such Lender Party
shall  remain the holder of any such Note for all  purposes  of this  Agreement,
(iv) the  Borrowers,  the Agents and the other Lender  Parties shall continue to
deal solely and directly with such Lender Party in  connection  with such Lender
Party's rights and obligations  under this Agreement,  (v) no participant  under
any such  participation  shall have any right to approve any amendment or waiver
of any  provision of any Loan  Document,  or any consent to any departure by any
Loan  Party  therefrom,  except to the  extent  that such  amendment,  waiver or
consent  would reduce the principal of, or interest on, the Notes or any fees or
other  amounts  payable  hereunder,  in each case to the extent  subject to such
participation,  postpone  any date  fixed for any  payment of  principal  of, or
interest on, the Notes or any fees or other amounts payable  hereunder,  in each
case  to  the  extent  subject  to  such   participation,   or  release  all  or
substantially all of the Collateral and (vi) such Lender Party shall give prompt
notice to the Administrative  Agent of the amount and Persons party to each such
participation.

                  (h)  Notwithstanding  any  other  provision  set forth in this
Agreement, any Lender Party may at any time create a security interest in all or
any portion of its rights under this Agreement  (including,  without limitation,
the  Advances  owing  to it and the  Note or  Notes  held by it) in favor of any
Federal  Reserve Bank in accordance  with Regulation A of the Board of Governors
of the Federal Reserve System.

                  SECTION 9.08. Execution in Counterparts. This Agreement may be
executed  in any  number of  counterparts  and by  different  parties  hereto in
separate  counterparts,  each of which when so executed shall be deemed to be an
original  and all of which  taken  together  shall  constitute  one and the same
agreement.  Manual  delivery of an executed  counterpart  of a signature page to
this  Agreement  by  telecopier  shall be  effective  as delivery of an original
executed counterpart of this Agreement.

                  SECTION 9.09. No Liability of the Issuing  Banks.  The Company
assumes all risks of the acts or omissions of any  beneficiary  or transferee of
any Letter of Credit with  respect to its use of such Letter of Credit.  Neither
any  Issuing  Bank nor any of its  officers  or  directors  shall be  liable  or
responsible  for:  (a) the use that may be made of any  Letter  of Credit or any
acts or omissions of any beneficiary or transferee in connection therewith;  (b)
the validity,  sufficiency or genuineness  of documents,  or of any  endorsement
thereon,  even if  such  documents  should  prove  to be in any or all  respects
invalid,  insufficient,  fraudulent or forged;  (c) payment by such Issuing Bank
against  presentation of documents that do not comply with the terms of a Letter
of Credit,  including failure of any documents to bear any reference or adequate
reference to the Letter of Credit; or (d) any other circumstances  whatsoever in
making or failing to make payment

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                                       145

under any Letter of Credit,  except that the Company  shall have a claim against
such Issuing Bank, and such Issuing Bank shall be liable to the Company,  to the
extent of any direct,  but not  consequential,  damages  suffered by the Company
that  the  Company  proves  were  caused  by (i)  such  Issuing  Bank's  willful
misconduct or gross negligence as determined in a final, non-appealable judgment
by a court of competent  jurisdiction in determining whether documents presented
under any Letter of Credit comply with the terms of the Letter of Credit or (ii)
such Issuing  Bank's  willful  failure to make lawful  payment under a Letter of
Credit  after  the  presentation  to it of a  draft  and  certificates  strictly
complying with the terms and conditions of the Letter of Credit.  In furtherance
and not in limitation of the foregoing,  such Issuing Bank may accept  documents
that  appear on their face to be in order,  without  responsibility  for further
investigation, regardless of any notice or information to the contrary.

                  SECTION 9.10.  Release of  Collateral.  Upon the sale,  lease,
transfer or other  disposition  of any item of  Collateral  of any Loan Party in
accordance with the terms of the Loan Documents,  the Collateral  Agent will, at
the Company's expense,  execute and deliver to such Loan Party such documents as
such Loan Party may  reasonably  request to evidence the release of such item of
Collateral  from  the  assignment  and  security   interest  granted  under  the
Collateral Documents in accordance with the terms of the Loan Documents.

                  SECTION  9.11.  Jurisdiction,  Etc.  (a)  Each of the  parties
hereto  hereby  irrevocably  and  unconditionally  submits,  for  itself and its
property,  to the  nonexclusive  jurisdiction  of any New  York  State  court or
Federal court of the United States of America  sitting in New York City, and any
appellate court from any thereof,  in any action or proceeding arising out of or
relating to this  Agreement or any of the other Loan  Documents to which it is a
party, or for recognition or enforcement of any judgment in respect thereof, and
each of the parties hereto hereby  irrevocably and  unconditionally  agrees that
all  claims  in  respect  of any such  action  or  proceeding  may be heard  and
determined in any such New York State court or, to the extent  permitted by law,
in such Federal  court.  Each  Foreign  Borrower  hereby  agrees that service of
process  in any such  action or  proceeding  brought  in any such New York State
court or in such Federal  court may be made upon the  Company,  and each Foreign
Subsidiary  hereby  irrevocably  appoints  the Company its  authorized  agent to
accept such  service of  process,  and agrees that the failure of the Company to
give any notice of any such  service  shall not impair or affect the validity of
such service or any judgment rendered in any action or proceeding based thereon.
Each Borrower hereby further  irrevocably  consents to the service of process in
any action or  proceeding  in such  courts by the  mailing  thereof by any party
hereto by registered or certified mail, postage prepaid, to such Borrower at its
address  specified in Section  9.02.  Each of the parties  hereto  agrees that a
final  judgment in any such action or proceeding  shall be conclusive and may be
enforced in other  jurisdictions  by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement shall affect any right that any party
may otherwise have to bring any action or proceeding  relating to this Agreement
or any of the other Loan Documents in the courts of any jurisdiction.



<PAGE>   152


                                       146

                  (b) Each of the parties hereto irrevocably and unconditionally
waives,  to the  fullest  extent  it may  legally  and  effectively  do so,  any
objection  that it may now or hereafter have to the laying of venue of any suit,
action or proceeding  arising out of or relating to this Agreement or any of the
other  Loan  Documents  to which it is a party in any New York  State or Federal
court.  Each of the parties  hereto hereby  irrevocably  waives,  to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.

                  SECTION 9.13.  Judgment.  (a) If for the purposes of obtaining
judgment in any court it is necessary to convert a sum due  hereunder in Dollars
into another currency, the parties hereto agree, to the fullest extent that they
may  effectively do so, that the rate of exchange used shall be that at which in
accordance  with  normal  banking  procedures  the  Administrative  Agent  could
purchase  Dollars with such other  currency at  Citibank's  principal  office in
London at 11:00 A.M.  (London time) on the Business Day preceding  that on which
final judgment is given.

                  (b) If for the purposes of obtaining  judgment in any court it
is necessary to convert a sum due hereunder in a Foreign  Currency into Dollars,
the parties agree to the fullest  extent that they may  effectively  do so, that
the rate of  exchange  used  shall be that at which in  accordance  with  normal
banking procedures the Administrative Agent could purchase such Foreign Currency
with  Dollars at  Citibank's  principal  office in London at 11:00 A.M.  (London
time) on the Business Day preceding that on which final judgment is given.

                  (c) The  obligation of each Borrower in respect of any sum due
from it in any  currency  (the  "Primary  Currency")  to any Lender Party or the
Administrative Agent hereunder shall,  notwithstanding any judgment in any other
currency,  be  discharged  only to the extent that on the Business Day following
receipt by such Lender Party or the  Administrative  Agent (as the case may be),
of any sum  adjudged to be so due in such other  currency,  such Lender Party or
the  Administrative  Agent (as the case may be) may in  accordance  with  normal
banking  procedures  purchase the  applicable  Primary  Currency with such other
currency;  if the amount of the applicable Primary Currency so purchased is less
than such sum due to such Lender Party or the Administrative  Agent (as the case
may be) in the applicable Primary Currency,  each Borrower agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify such Lender Party
or the  Administrative  Agent (as the case may be) against such loss, and if the
amount of the applicable  Primary Currency so purchased  exceeds such sum due to
any  Lender  Party  or the  Administrative  Agent  (as the  case  may be) in the
applicable Primary Currency,  such Lender Party or the Administrative  Agent (as
the case may be) agrees to remit to such Borrower such excess.

                  SECTION  9.14.  Governing  Law.  This  Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State of
New York.



<PAGE>   153


                                       147

                  SECTION  9.15.  Substitution  of Currency.  If a change in any
Foreign  Currency  occurs  pursuant to any applicable law, rule or regulation of
any  governmental,   monetary  or  multi-national   authority,   this  Agreement
(including,  without  limitation,  the definition of Eurocurrency  Rate) will be
amended to the extent determined by the Administrative  Agent (acting reasonably
and in  consultation  with the  Borrowers and the  Multicurrency  Lenders) to be
necessary  to reflect  the change in  currency  and to put the  Lenders  and the
Borrowers in the same position, so far as possible, that they would have been in
if no change in such Foreign Currency had occurred.

                  SECTION 9.16. Waiver of Jury Trial. Each of the Borrowers, the
Agents and the Lender Parties  irrevocably  waives all right to trial by jury in
any action,  proceeding  or  counterclaim  (whether  based on contract,  tort or
otherwise) arising out of or relating to any of the Loan Documents, the Advances
or  the  actions  of  any  Agent  or  any  Lender  Party  in  the   negotiation,
administration, performance or enforcement thereof.

                  SECTION  9.17.  Power  of  Attorney.  Each  Subsidiary  of the
Company  may  from  time  to time  authorize  and  appoint  the  Company  as its
attorney-in-fact to execute and deliver (a) any amendment,  waiver or consent in
accordance with Section 9.01 on behalf of and in the name of such Subsidiary and
(b) any notice or other communication hereunder, on behalf of and in the name of
such  Subsidiary.  Such  authorization  shall become effective as of the date on
which such Subsidiary  delivers to the Administrative  Agent a power of attorney
enforceable  under  applicable  law  and  any  additional   information  to  the
Administrative  Agent as  necessary  to make such power of  attorney  the legal,
valid and binding obligation of such Subsidiary.








<PAGE>   154


                                       148

                  IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.

                                        HANDY & HARMAN


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


                                        HANDY & HARMAN OF CANADA, LIMITED


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


                                        HANDY & HARMAN EUROPE LIMITED


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


                                        RIGBY-MARYLAND (STAINLESS) LIMITED
                        
                        
                                        By
                                           -------------------------------------
                                            Title:
                        
                        
                                        INDIANA TUBE DANMARK A/S
                        
                        
                                        By
                                           -------------------------------------
                                            Title:
              



<PAGE>   155
                                       149



                               Agents


                               CITICORP USA, INC.,
                                  as Administrative Agent and as Collateral
                                       Agent


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



                               Initial Lenders


                               CITIBANK, N.A., as the Initial Issuing Bank and
                                     as Initial Lender


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



                                NATIONSBANK, N.A.


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





<PAGE>   156


                                       150

                               PNC BANK, N.A.


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


                               THE ROYAL BANK OF SCOTLAND PLC.


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


                               BHF-BANK AKTIENGESELLSCHAFT


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


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


                               COMPAGNIE FINANCIERE DE CIC ET DE
                               L'UNION EUROPEENNE


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


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





<PAGE>   157


                                       151

                               COMERICA BANK


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


                               DEN DANSKE BANK AKTIESELSKAB,
                               CAYMAN ISLANDS BRANCH


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


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



                               FLEET PRECIOUS METALS INC.


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


                               GENERAL ELECTRIC CAPITAL
                                 CORPORATION


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



                               KZH-ING-3 CORPORATION


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



<PAGE>   158


                                       152


                               KEYBANK, N.A.


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


                               KZH-SOLEIL-2 CORPORATION


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




                               MASSACHUSETTS MUTUAL LIFE
                               INSURANCE COMPANY


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


                               MASSMUTUAL HIGH YIELD PARTNERS II,
                               LLC

                               By:      HYP MANAGEMENT, INC.,
                                        as managing member


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


                               ROYAL BANK OF CANADA


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



<PAGE>   159


                                        1

                                                                     EXHIBIT A-1

                                                                         FORM OF
                                                                     TERM A NOTE


$_______________                                      Dated:  _________ __, ____


                  FOR VALUE RECEIVED,  the  undersigned,  Handy & Harman,  a New
York  corporation  (the  "Borrower"),  HEREBY  PROMISES  TO PAY to the  order of
_________  _______________  (the  "Lender")  for the  account of its  Applicable
Lending  Office  (as  defined  in the Credit  Agreement  referred  to below) the
principal amount of the Term A Advance (as defined below) owing to the Lender by
the  Borrower  pursuant  to the Credit  Agreement  dated as of July 30, 1998 (as
amended,  amended and restated,  supplemented or otherwise modified from time to
time, the "Credit  Agreement";  terms defined therein,  unless otherwise defined
herein, being used herein as therein defined) among the Borrower,  certain other
borrowers  parties  thereto,  the Lender and certain other lender  parties party
thereto, Citicorp USA, Inc. ("Citicorp"),  as Collateral Agent, and Citicorp, as
Administrative  Agent for the Lender and such other lender parties, on the dates
and in the amounts specified in the Credit Agreement.

                  The Borrower  promises to pay interest on the unpaid principal
amount of the Term A Advance  from the date of such  Term A Advance  until  such
principal  amount is paid in full, at such interest  rates,  and payable at such
times, as are specified in the Credit Agreement.

                  Both principal and interest are payable in lawful money of the
United States of America to Citicorp,  as  Administrative  Agent, at its account
with Citibank at its office at Two Penn's Way,  Suite 200, New Castle,  Delaware
19720, in same day funds. The Term A Advance owing to the Lender by the Borrower
and the maturity thereof, and all payments made on account of principal thereof,
shall be recorded by the Lender and, prior to any transfer  hereof,  endorsed on
the grid  attached  hereto,  which is part of this  Promissory  Note;  provided,
however,  that  the  failure  of the  Lender  to make any  such  recordation  or
endorsement  shall  not  affect  the  Obligations  of the  Borrower  under  this
Promissory Note.




<PAGE>   160


                                        2

                  This  Promissory  Note is one of the Notes referred to in, and
is entitled to the  benefits  of, the Credit  Agreement.  The Credit  Agreement,
among other things, (i) provides for the making of a single advance (the "Term A
Advance")  by the Lender to the  Borrower  in an amount not to exceed the Dollar
amount first above mentioned,  the  indebtedness of the Borrower  resulting from
such Term A Advance being evidenced by this  Promissory  Note, and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events and also for  prepayments on account of principal  hereof prior to
the  maturity  hereof  upon the  terms and  conditions  therein  specified.  The
obligations  of the  Borrower  under  this  Promissory  Note and the other  Loan
Documents,  and the  obligations  of the  other  Loan  Parties  under  the  Loan
Documents,  are  guaranteed and are secured by the  Collateral,  in each case as
provided in the Loan Documents.


                               HANDY & HARMAN


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




<PAGE>   161


                       ADVANCES AND PAYMENTS OF PRINCIPAL


<TABLE>
<CAPTION>

                                                     Amount of                  Unpaid
                           Amount of               Principal Paid              Principal                 Notation
       Date                 Advance                  or Prepaid                 Balance                  Made By


<S>                 <C>                       <C>                      <C>                       <C>                    
------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


==================  ========================  ======================== ========================= ========================


</TABLE>



<PAGE>   162


                                                                     EXHIBIT A-2

                                                                         FORM OF
                                                                     TERM B NOTE


$_______________                                      Dated:  _________ __, ____


                  FOR VALUE RECEIVED,  the  undersigned,  Handy & Harman,  a New
York    corporation    (the     "Borrower"),     HEREBY    PROMISES    TO    PAY
_________________________  or its  registered  assigns  (the  "Lender")  for the
account of its  Applicable  Lending  Office (as defined in the Credit  Agreement
referred to below) the principal amount of the Term B Advance (as defined below)
owing to the Lender by the Borrower pursuant to the Credit Agreement dated as of
July 30, 1998 (as  amended,  amended and  restated,  supplemented  or  otherwise
modified  from time to time,  the "Credit  Agreement";  terms  defined  therein,
unless otherwise defined herein, being used herein as therein defined) among the
Borrower,  certain other borrowers parties thereto, the Lender and certain other
lender parties party  thereto,  Citicorp USA, Inc.  ("Citicorp"),  as Collateral
Agent,  and  Citicorp,  as  Administrative  Agent for the  Lender and such other
lender  parties,  on the  dates  and  in the  amounts  specified  in the  Credit
Agreement.

                  The  Borrower  promises  to pay to  ______  or its  registered
assigns  interest on the unpaid  principal amount of the Term B Advance from the
date of such Term B Advance until such principal amount is paid in full, at such
interest  rates,  and  payable at such  times,  as are  specified  in the Credit
Agreement.

                  Both principal and interest are payable in lawful money of the
United States of America to Citicorp,  as  Administrative  Agent, at its account
with Citibank at its office at Two Penn's Way,  Suite 200, New Castle,  Delaware
19720, in same day funds. The Term B Advance owing to the Lender by the Borrower
and the maturity thereof, and all payments made on account of principal thereof,
shall be recorded by the Lender and, prior to any transfer  hereof,  endorsed on
the grid  attached  hereto,  which is part of this  Promissory  Note;  provided,
however,  that  the  failure  of the  Lender  to make any  such  recordation  or
endorsement  shall  not  affect  the  Obligations  of the  Borrower  under  this
Promissory Note.

                  This  Promissory  Note is one of the Notes referred to in, and
is entitled to the  benefits  of, the Credit  Agreement.  The Credit  Agreement,
among other things, (i) provides for the making of a single advance (the "Term B
Advance")  by the Lender to the  Borrower  in an amount not to exceed the Dollar
amount first above mentioned, the indebtedness of the Borrower



<PAGE>   163


                                        2

resulting from such Term B Advance being evidenced by this Promissory  Note, and
(ii)  contains  provisions  for  acceleration  of the  maturity  hereof upon the
happening  of  certain  stated  events  and also for  prepayments  on account of
principal  hereof  prior to the  maturity  hereof upon the terms and  conditions
therein  specified.  The  obligations of the Borrower under this Promissory Note
and the other Loan  Documents,  and the  obligations  of the other Loan  Parties
under the Loan Documents,  are guaranteed and are secured by the Collateral,  in
each case as provided in the Loan Documents.

                                     HANDY & HARMAN


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




<PAGE>   164


                       ADVANCES AND PAYMENTS OF PRINCIPAL




<TABLE>
<CAPTION>

                                                     Amount of                  Unpaid
                           Amount of               Principal Paid              Principal                 Notation
       Date                 Advance                  or Prepaid                 Balance                  Made By


<S>                 <C>                       <C>                      <C>                       <C>                    
------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


==================  ========================  ======================== ========================= ========================


</TABLE>



<PAGE>   165


                                                                     EXHIBIT A-3


                                                                         FORM OF
                                                               DELAYED DRAW NOTE


$_______________                                      Dated:  _________ __, ____


                  FOR VALUE RECEIVED,  the  undersigned,  Handy & Harman,  a New
York  corporation  (the  "Borrower"),  HEREBY  PROMISES  TO PAY to the  order of
_________________________  (the  "Lender")  for the  account  of its  Applicable
Lending  Office  (as  defined  in the Credit  Agreement  referred  to below) the
aggregate principal amount of the Delayed Draw Advances (as defined below) owing
to the Lender by the Borrower  pursuant to the Credit Agreement dated as of July
30, 1998 (as amended,  amended and restated,  supplemented or otherwise modified
from  time to time,  the  "Credit  Agreement";  terms  defined  therein,  unless
otherwise  defined  herein,  being  used  herein as therein  defined)  among the
Borrower,  certain other borrowers parties thereto, the Lender and certain other
lender parties party  thereto,  Citicorp USA, Inc.  ("Citicorp"),  as Collateral
Agent,  and  Citicorp,  as  Administrative  Agent for the  Lender and such other
lender parties, on the Termination Date.

                  The Borrower  promises to pay interest on the unpaid principal
amount of each  Delayed  Draw Advance from the date of such Delayed Draw Advance
until such principal amount is paid in full, at such interest rates, and payable
at such times, as are specified in the Credit Agreement.

                  Both principal and interest are payable in lawful money of the
United States of America to Citicorp,  as  Administrative  Agent, at its account
with Citibank at its office at Two Penn's Way,  Suite 200, New Castle,  Delaware
19720 in same day funds.  Each Delayed  Draw Advance  owing to the Lender by the
Borrower and the maturity thereof, and all payments made on account of principal
thereof,  shall be  recorded by the Lender and,  prior to any  transfer  hereof,
endorsed on the grid attached  hereto,  which is part of this  Promissory  Note;
provided,  however,  that the failure of the Lender to make any such recordation
or  endorsement  shall not affect the  Obligations  of the  Borrower  under this
Promissory Note.

                  This  Promissory  Note is one of the Notes referred to in, and
is entitled to the  benefits  of, the Credit  Agreement.  The Credit  Agreement,
among other  things,  (i) provides for the making of advances (the "Delayed Draw
Advances")  by the  Lender to the  Borrower  from  time to time in an  aggregate
amount not to exceed the Dollar amount first above  mentioned,  the indebtedness
of the Borrower resulting from each such Delayed Draw Advance being evidenced by
this  Promissory  Note,  and (ii) contains  provisions for  acceleration  of the
maturity  hereof  upon the  happening  of  certain  stated  events  and also for
prepayments on account of principal hereof prior to the maturity hereof upon the
terms and conditions therein specified. The obligations of



<PAGE>   166


                                        2

the Borrower under this Promissory  Note and the other Loan  Documents,  and the
obligations of the other Loan Parties under the Loan  Documents,  are guaranteed
and are  secured  by the  Collateral,  in  each  case as  provided  in the  Loan
Documents.

                                     HANDY & HARMAN


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



<PAGE>   167


                                                         3

                                        ADVANCES AND PAYMENTS OF PRINCIPAL


<TABLE>
<CAPTION>

                                                     Amount of                  Unpaid
                           Amount of               Principal Paid              Principal                 Notation
       Date                 Advance                  or Prepaid                 Balance                  Made By


<S>                 <C>                       <C>                      <C>                       <C>                    
------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


==================  ========================  ======================== ========================= ========================


</TABLE>


<PAGE>   168



                                                                     EXHIBIT A-4


                                                                         FORM OF
                                                              MULTICURRENCY NOTE


                                                      Dated:  _________ __, ____


                  FOR       VALUE       RECEIVED,        the        undersigned,
_________________________,  a __________  corporation (the  "Borrower"),  HEREBY
PROMISES TO PAY to the order of _________________________ (the "Lender") for the
account of its  Applicable  Lending  Office (as defined in the Credit  Agreement
referred to below) the aggregate principal amount of the Multicurrency  Advances
(as defined  below) owing to the Lender by the  Borrower  pursuant to the Credit
Agreement  dated  as of  July  30,  1998  (as  amended,  amended  and  restated,
supplemented  or otherwise  modified from time to time, the "Credit  Agreement";
terms defined  therein,  unless otherwise  defined herein,  being used herein as
therein  defined) among the Borrower,  certain other borrowers  parties thereto,
the Lender and certain other lender  parties party  thereto,  Citicorp USA, Inc.
("Citicorp"), as Collateral Agent, and Citicorp, as Administrative Agent for the
Lender and such other lender parties, on the Termination Date.

                  The Borrower  promises to pay interest on the unpaid principal
amount of each Multicurrency Advance from the date of such Multicurrency Advance
until such principal amount is paid in full, at such interest rates, and payable
at such times, as are specified in the Credit Agreement.

                  Both principal and interest are payable in the currency of the
applicable  Multicurrency  Advance at the applicable  Payment Office in same day
funds.  Each  Multicurrency  Advance owing to the Lender by the Borrower and the
maturity thereof,  and all payments made on account of principal thereof,  shall
be recorded by the Lender and,  prior to any  transfer  hereof,  endorsed on the
grid attached hereto, which is part of this Promissory Note; provided,  however,
that the failure of the Lender to make any such recordation or endorsement shall
not affect the Obligations of the Borrower under this Promissory Note.

                  This  Promissory  Note is one of the Notes referred to in, and
is entitled to the  benefits  of, the Credit  Agreement.  The Credit  Agreement,
among other things, (i) provides for the making of advances (the  "Multicurrency
Advances") by the Lender to the Borrower from time to time, the  indebtedness of
the Borrower resulting from each such  Multicurrency  Advance being evidenced by
this  Promissory  Note,  (ii) contains  provisions  for  determining  the Dollar
Equivalent of  Multicurrency  Advances  denominated in Foreign  Currencies,  and
(iii)  contains  provisions  for  acceleration  of the maturity  hereof upon the
happening  of  certain  stated  events  and also for  prepayments  on account of
principal  hereof  prior to the  maturity  hereof upon the terms and  conditions
therein  specified.  The  obligations of the Borrower under this Promissory Note
and



<PAGE>   169


                                        2

the other Loan  Documents,  and the  obligations of the other Loan Parties under
the Loan Documents,  are guaranteed and are secured by the  Collateral,  in each
case as provided in the Loan Documents.

                                     [NAME OF BORROWER]


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



<PAGE>   170



                       ADVANCES AND PAYMENTS OF PRINCIPAL

<TABLE>
<CAPTION>

                                                     Amount of                  Unpaid
                           Amount of               Principal Paid              Principal                 Notation
       Date                 Advance                  or Prepaid                 Balance                  Made By


<S>                 <C>                       <C>                      <C>                       <C>                    
------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


==================  ========================  ======================== ========================= ========================


</TABLE>


<PAGE>   171


                                                                     EXHIBIT A-5


                                                                         FORM OF
                                                           REVOLVING CREDIT NOTE


$_______________                                      Dated:  _________ __, ____


                  FOR VALUE RECEIVED,  the  undersigned,  Handy & Harman,  a New
York  corporation  (the  "Borrower"),  HEREBY  PROMISES  TO PAY to the  order of
_________________________  (the  "Lender")  for the  account  of its  Applicable
Lending  Office  (as  defined  in the Credit  Agreement  referred  to below) the
aggregate  principal  amount of the Revolving Credit Advances (as defined below)
owing to the Lender by the Borrower pursuant to the Credit Agreement dated as of
July 30, 1998 (as  amended,  amended and  restated,  supplemented  or  otherwise
modified  from time to time,  the "Credit  Agreement";  terms  defined  therein,
unless otherwise defined herein, being used herein as therein defined) among the
Borrower,  certain other borrowers parties thereto, the Lender and certain other
lender parties party  thereto,  Citicorp USA, Inc.  ("Citicorp"),  as Collateral
Agent,  and  Citicorp,  as  Administrative  Agent for the  Lender and such other
lender parties, on the Termination Date.

                  The Borrower  promises to pay interest on the unpaid principal
amount of each Revolving  Credit Advance from the date of such Revolving  Credit
Advance until such principal amount is paid in full, at such interest rates, and
payable at such times, as are specified in the Credit Agreement.

                  Both principal and interest are payable in lawful money of the
United States of America to Citicorp,  as Administrative Agent, at its office at
Citibank at its office at Two Penn's Way, Suite 200, New Castle,  Delaware 19720
in same day funds.  Each  Revolving  Credit  Advance  owing to the Lender by the
Borrower and the maturity thereof, and all payments made on account of principal
thereof,  shall be  recorded by the Lender and,  prior to any  transfer  hereof,
endorsed on the grid attached  hereto,  which is part of this  Promissory  Note;
provided,  however,  that the failure of the Lender to make any such recordation
or  endorsement  shall not affect the  Obligations  of the  Borrower  under this
Promissory Note.

                  This  Promissory  Note is one of the Notes referred to in, and
is entitled to the  benefits  of, the Credit  Agreement.  The Credit  Agreement,
among other  things,  (i)  provides for the making of advances  (the  "Revolving
Credit  Advances")  by the  Lender  to the  Borrower  from  time  to  time in an
aggregate  amount not to exceed at any time  outstanding the Dollar amount first
above  mentioned,  the  indebtedness  of the Borrower  resulting  from each such
Revolving  Credit  Advance being  evidenced by this  Promissory  Note,  and (ii)
contains  provisions for  acceleration of the maturity hereof upon the happening
of certain stated events and also for prepayments on account of principal hereof
prior to the maturity hereof upon the terms and conditions therein



<PAGE>   172


                                        2

specified.  The  obligations of the Borrower under this  Promissory Note and the
other Loan  Documents,  and the  obligations of the other Loan Parties under the
Loan Documents,  are guaranteed and are secured by the Collateral,  in each case
as provided in the Loan Documents.

                                     HANDY & HARMAN


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





<PAGE>   173


                       ADVANCES AND PAYMENTS OF PRINCIPAL


<TABLE>
<CAPTION>

                                                     Amount of                  Unpaid
                           Amount of               Principal Paid              Principal                 Notation
       Date                 Advance                  or Prepaid                 Balance                  Made By


<S>                 <C>                       <C>                      <C>                       <C>                    
------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


------------------  ------------------------  ------------------------ ------------------------- ------------------------


==================  ========================  ======================== ========================= ========================


</TABLE>


<PAGE>   174




                                                                     EXHIBIT A-6

                                                                   FORM OF DRAFT


                                                DUE___________________ No. BA___

                                                                 Toronto, Canada

                                                              ------------, ----


ON ______________________________, (WITHOUT GRACE), FOR VALUE RECEIVED
PAY TO THE ORDER OF THE UNDERSIGNED DRAWER THE SUM OF
$_______________________________________________________ CANADIAN DOLLARS


TO:      [NAME OF BANK]



                                          [NAME OF CANADIAN BORROWER]



                                          PER:_____________________________
                                             Authorized Signatory



<PAGE>   175

                                                                     EXHIBIT B-1


                                                                         FORM OF
                                                             NOTICE OF BORROWING



Citicorp USA, Inc.,
  as Administrative Agent
  under the Credit Agreement
  referred to below
Two Penn's Way
New Castle, Delaware 19720               [Date]


                  Attention:  _______________


Ladies and Gentlemen:

                  The  undersigned,  [Name of  Borrower],  refers to the  Credit
Agreement  dated  as of  July  30,  1998  (as  amended,  amended  and  restated,
supplemented  or otherwise  modified from time to time, the "Credit  Agreement";
the terms  defined  therein  being used  herein as therein  defined),  among the
undersigned,  certain other borrowers parties thereto,  the Lender Parties party
thereto, Citicorp USA, Inc. ("Citicorp"),  as Collateral Agent, and Citicorp, as
Administrative  Agent for the  Lender  Parties,  and  hereby  gives you  notice,
irrevocably,  pursuant  to  Section  2.02  of  the  Credit  Agreement  that  the
undersigned hereby requests a Borrowing under the Credit Agreement,  and in that
connection  sets forth below the  information  relating to such  Borrowing  (the
"Proposed Borrowing") as required by Section 2.02(a) of the Credit Agreement:

                  (i)      The  Business  Day  of  the  Proposed   Borrowing  is
         _________ __, ____.

                  (ii) The  Facility  under  which  the  Proposed  Borrowing  is
         requested is the _______________ Facility.

                  (iii) The Type of Advances  comprising the Proposed  Borrowing
         is  [Base  Rate  Advances]   [Eurocurrency  Rate  Advances][Local  Rate
         Advances].

                  (iv)  The  aggregate  amount  of  the  Proposed  Borrowing  is
         [$__________] [for a Multicurrency Borrowing,  list currency and amount
         of such Multicurrency Borrowing].

                           [(v)   The   initial   Interest   Period   for   each
         Eurocurrency  Rate Advance  made as part of the  Proposed  Borrowing is
         __________ month[s].]

<PAGE>   176


                                        2


                  The undersigned hereby certifies that the following statements
are  true on the  date  hereof,  and  will be true on the  date of the  Proposed
Borrowing:

                  (A) the representations and warranties  contained in each Loan
         Document are correct on and as of the date of the  Proposed  Borrowing,
         before and after  giving  effect to the Proposed  Borrowing  and to the
         application of the proceeds therefrom, as though made on and as of such
         date, other than any such  representations or warranties that, by their
         terms,  refer to a specific  date  other than the date of the  Proposed
         Borrowing, in which case, as of such specific date.

                  (B) no Default has occurred and is continuing, or would result
         from such Proposed  Borrowing or from the  application  of the proceeds
         therefrom.

                  (C) if the Proposed  Borrowing  consists of a Revolving Credit
         Borrowing or a Multicurrency  Borrowing,  the sum of the Loan Values of
         the Eligible  Collateral exceeds the aggregate  principal amount of the
         Revolving  Credit  Advances  plus Swing Line  Advances  plus  Letter of
         Credit Advances to be outstanding plus Multicurrency  Advances plus the
         Available  Amount of all  Letters of Credit then  outstanding  plus the
         Face Amount of all Bankers'  Acceptances then outstanding  after giving
         effect to the Proposed Borrowing.

                  Manual  delivery of an executed  counterpart of this Notice of
Borrowing by telecopier  shall be effective as delivery of an original  executed
counterpart of this Notice of Borrowing.


                                     Very truly yours,

                                     [NAME OF BORROWER]


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





<PAGE>   177


                                        

                                                              EXHIBIT B-2 TO THE
                                                                CREDIT AGREEMENT

                            FORM OF NOTICE OF DRAWING

Citicorp USA, Inc., as
  Collateral and Administrative
  Agent under the Credit Agreement
  referred to below

                  Attention:
                             ---------------------------
Ladies and Gentlemen:

                  The  undersigned,   Handy  &  Harman  of  Canada,  Limited,  a
corporation  organized under the laws of Ontario,  Canada,  refers to the Credit
Agreement  dated as of July 30,  1997 (as  amended,  supplemented  or  otherwise
modified  from time to time,  the "Credit  Agreement";  terms  defined  therein,
unless otherwise defined herein, being used herein as therein defined) among the
undersigned,  certain other borrowers parties thereto, the Initial Lenders named
therein,  the Initial  Issuing Banks named  therein,  and Citicorp USA, Inc., as
Collateral  Agent  and  Administrative  Agent,  and  hereby  gives  you  notice,
irrevocably,  pursuant  to  Section  2.04  of  the  Credit  Agreement  that  the
undersigned  hereby  requests a Drawing under the Credit  Agreement and, in that
connection,  sets forth  below the  information  relating to such  Drawing  (the
"Proposed Drawing") as required by Section 2.04(a) of the Credit Agreement:

                  (i) The Business Day of the Proposed Drawing is , .

                  (ii) The  aggregate  Face  Amount of the  Proposed  Drawing is
         CN$______.

                  (iii) The initial  Maturity Date for each Banker's  Acceptance
         comprising  part  of the  Proposed  Drawing  is  [one][two][three][six]
         months.

                  The undersigned hereby certifies that the following statements
are  true on the  date  hereof  and  will be  true on the  date of the  Proposed
Drawing:

                  (A) the representations and warranties  contained in each Loan
         Document are complete and correct on and as of the date of the Proposed
         Drawing, before and after giving effect to such Proposed Drawing and to
         the application of the proceeds therefrom,  as though made on and as of
         such date other than any such  representations  and warranties that, by
         their  terms,  refer  to a  specific  date  other  than the date of the
         Proposed Drawing, in which case, as of such specific date;

                  (B) no event has occurred and is  continuing,  or would result
         from the Proposed



<PAGE>   178


                                                         2

         Drawing  or  from  the  application  of the  proceeds  therefrom,  that
         constitutes a Default, and

                  (C) the sum of the  Loan  Values  of the  Eligible  Collateral
         exceeds the aggregate principal amount of the Revolving Credit Advances
         plus  Swing  Line  Advances   plus  Letter  of  Credit   Advances  plus
         Multicurrency  Advances to be outstanding  plus the Available Amount of
         all  Letters of Credit  then  outstanding  plus the Face  Amount of all
         Bankers'  Acceptances  to be  outstanding  after  giving  effect to the
         Proposed Drawing.

                                            Very truly yours,


                                            HANDY & HARMAN OF
                                                CANADA LIMITED


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




<PAGE>   179


                                                                       EXHIBIT C



                                                                         FORM OF
                                                       ASSIGNMENT AND ACCEPTANCE



                  Reference is made to the Credit Agreement dated as of July 30,
1998 (as amended, amended and restated,  supplemented or otherwise modified from
time to  time,  the  "Credit  Agreement";  the  terms  defined  therein,  unless
otherwise  defined herein,  being used herein as therein  defined) among Handy &
Harman, a New York  corporation,  certain other borrowers  parties thereto,  the
Lender  Parties party  thereto,  Citicorp USA,  Inc., as Collateral  Agent,  and
Citicorp USA, Inc., as Administrative Agent for the Lender Parties.

                  Each  "Assignor"  referred to on Schedule 1 hereto  (each,  an
"Assignor")  and each  "Assignee"  referred  to on Schedule 1 hereto  (each,  an
"Assignee") agrees severally with respect to all information  relating to it and
its assignment hereunder and on Schedule 1 hereto as follows:

                  1. Such Assignor  hereby sells and assigns,  without  recourse
except as to the  representations  and  warranties  made by it  herein,  to such
Assignee,  and such Assignee hereby purchases and assumes from such Assignor, an
interest  in and to such  Assignor's  rights  and  obligations  under the Credit
Agreement as of the date hereof equal to the  percentage  interest  specified on
Schedule 1 hereto of all  outstanding  rights and  obligations  under the Credit
Agreement  Facility or Facilities  specified on Schedule 1 hereto.  After giving
effect to such sale and assignment,  such Assignee's  Commitments and the amount
of the  Advances  owing to such  Assignee  will be as set  forth on  Schedule  1
hereto.

                  2. Such  Assignor (i)  represents  and warrants that it is the
legal and  beneficial  owner of the interest or interests  being  assigned by it
hereunder  and that such interest or interests are free and clear of any adverse
claim;  (ii) makes no  representation  or warranty and assumes no responsibility
with respect to any  statements,  warranties  or  representations  made in or in
connection  with  any  Loan  Document  or  the  execution,  legality,  validity,
enforceability,  genuineness,  sufficiency  or value  of, or the  perfection  or
priority of any lien or security  interest  created or  purported  to be created
under or in  connection  with,  any Loan  Document  or any other  instrument  or
document furnished  pursuant thereto;  (iii) makes no representation or warranty
and assumes no  responsibility  with respect to the  financial  condition of any
Loan  Party or the  performance  or  observance  by any Loan Party of any of its
obligations  under  any  Loan  Document  or any  other  instrument  or  document
furnished  pursuant  thereto;  and (iv)  attaches the Note or Notes held by such
Assignor and requests that the Administrative  Agent exchange such Note or Notes
for a new Note or Notes payable to the order of such Assignee in an amount equal
to the Commitments assumed by such Assignee pursuant hereto or new Notes payable
to the order of such Assignee in an amount equal to the  Commitments  assumed by
such  Assignee  pursuant  hereto  and such  Assignor  in an amount  equal to the
Commitments retained by such Assignor under the



<PAGE>   180


                                        2

Credit Agreement, respectively, as specified on Schedule 1 hereto.

                  3. Such  Assignee (i) confirms  that it has received a copy of
the Credit Agreement,  together with copies of the financial statements referred
to in Section 4.01 thereof and such other  documents and  information  as it has
deemed  appropriate  to make its own credit  analysis and decision to enter into
this  Assignment and  Acceptance;  (ii) agrees that it will,  independently  and
without  reliance  upon any Agent,  any  Assignor or any other  Lender Party and
based on such  documents and  information  as it shall deem  appropriate  at the
time,  continue to make its own credit  decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints  and  authorizes  each Agent to take such action as agent on its behalf
and to  exercise  such powers and  discretion  under the Loan  Documents  as are
delegated  to such Agent by the terms  thereof,  together  with such  powers and
discretion as are reasonably incidental thereto; (v) agrees that it will perform
in accordance with their terms all of the  obligations  that by the terms of the
Credit  Agreement are required to be performed by it as a Lender Party; and (vi)
attaches any U.S.  Internal Revenue Service forms required under Section 2.14 of
the Credit Agreement.

                  4. Following the execution of this  Assignment and Acceptance,
it will be delivered to the Administrative Agent for acceptance and recording by
the Administrative  Agent. The effective date for this Assignment and Acceptance
(the  "Effective   Date")  shall  be  the  date  of  acceptance  hereof  by  the
Administrative Agent, unless otherwise specified on Schedule 1 hereto.

                  5. Upon such  acceptance  and recording by the  Administrative
Agent,  as of the  Effective  Date,  (i) such  Assignee  shall be a party to the
Credit  Agreement and, to the extent provided in this Assignment and Acceptance,
have the rights  and  obligations  of a Lender  Party  thereunder  and (ii) such
Assignor  shall,  to the extent  provided  in this  Assignment  and  Acceptance,
relinquish  its rights and be  released  from its  obligations  under the Credit
Agreement  (other than its rights and obligations  under the Loan Documents that
are specified  under the terms of such Loan  Documents to survive the payment in
full of the  Obligations  of the Loan  Parties  under the Loan  Documents to the
extent any claim  thereunder  relates to an event arising prior to the Effective
Date of this Assignment and  Acceptance)  and, if this Assignment and Acceptance
covers  all of the  remaining  portion of the  rights  and  obligations  of such
Assignor  under the Credit  Agreement,  such Assignor  shall cease to be a party
thereto.

                  6. Upon such  acceptance  and recording by the  Administrative
Agent,  from and after the Effective Date, the  Administrative  Agent shall make
all payments under the Credit Agreement and the Notes in respect of the interest
assigned  hereby  (including,  without  limitation,  all payments of  principal,
interest  and  commitment  fees with  respect  thereto) to such  Assignee.  Such
Assignor and such Assignee  shall make all  appropriate  adjustments in payments
under the Credit Agreement and the Notes for periods prior to the Effective Date
directly between themselves.




<PAGE>   181


                                        3


                  7. This  Assignment and  Acceptance  shall be governed by, and
construed in accordance with, the laws of the State of New York.

                  8. This  Assignment  and  Acceptance  may be  executed  in any
number of counterparts and by different parties hereto in separate counterparts,
each of which  when so  executed  shall be deemed to be an  original  and all of
which  taken  together  shall  constitute  one and the  same  agreement.  Manual
delivery  of an  executed  counterpart  of  Schedule  1 to this  Assignment  and
Acceptance by telecopier shall be effective as delivery of an original  executed
counterpart of this Assignment and Acceptance.


                  IN WITNESS  WHEREOF,  each  Assignor  and each  Assignee  have
caused  Schedule 1 to this  Assignment  and  Acceptance  to be executed by their
officers thereunto duly authorized as of the date specified thereon.




<PAGE>   182


                                   SCHEDULE 1
                                       to
                            ASSIGNMENT AND ACCEPTANCE

<TABLE>
<CAPTION>

<S>                                                         <C>            <C>          <C>             <C>           <C>    
ASSIGNOR
Revolving Credit Facility
     1Percentage interest assigned                                   %              %               %             %               %
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Revolving Credit Commitment assigned                  $              $             $               $              $
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Aggregate outstanding principal amount of                                                                       
         Revolving Credit Advances assigned                $              $             $               $              $
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Principal amount of Revolving Credit Note                                                                       
         payable to Assignor                               $              $             $               $              $
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
Term Facility                                                                                                        
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     2Percentage interest assigned                                   %              %               %             %               %
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Term Commitment assigned                              $              $             $               $              $
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Outstanding principal amount of                                                                                 
         Term Advance assigned                             $              $             $               $              $
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Principal amount of Term Note                                                                                   
         payable to Assignor                               $              $             $               $              $
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
Letter of Credit Facility                                                                                            
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Letter of Credit Commitment assigned                  $              $             $               $              $
---------------------------------------------------------  -----------    ----------    ------------    -----------    -------------
     Letter of Credit Commitment retained                  $              $             $               $              $
=========================================================  ===========    ===========   =============   ===========    ============
                                                                                                                   
</TABLE>

--------
1    If  Nonratable  Assignments  are not  permitted,  the  percentage  interest
     assigned by an Assignor must be the same for all Facilities (other than the
     Letter of Credit Facility).
2    See footnote 1.



<PAGE>   183


                                        2
<TABLE>
<CAPTION>


<S>                                                        <C>          <C>           <C>            <C>             <C>

ASSIGNEE
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
Revolving Credit Facility
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     3Percentage interest assumed                                    %            %               %             %               %
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     Revolving Credit Commitment assumed                   $            $             $               $              $
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     Aggregate outstanding principal amount of                                                                     
         Revolving Credit Advances assumed                 $            $             $               $              $
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     Principal amount of Revolving Credit Note                                                                     
         payable to Assignee                               $            $             $               $              $
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
Term Facility                                                                                                      
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     4Percentage interest assumed                                    %            %               %             %               %
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     Term Commitment assumed                               $            $             $               $              $
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     Outstanding principal amount of                                                                               
         Term Advance assumed                              $            $             $               $              $
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     Principal amount of Term Note                                                                                 
         payable to Assignee                               $            $             $               $              $
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
Letter of Credit Facility                                                                                          
--------------------------------------------------------   -----------  -----------   -------------   ----------     -------------
     Letter of Credit Commitment assumed                   $            $             $               $              $
=========================================================  ===========  ===========   =============   ===========    ============
                                                                                                                 
</TABLE>

--------
3    If  Nonratable  Assignments  are not  permitted,  the  percentage  interest
     assumed by an Assignee must be the same for all Facilities  (other than the
     Letter of Credit Facility).
4    See footnote 4.


Handy & Harman Credit Agreement

<PAGE>   184


                                        3

Effective Date (if other than date of acceptance by Administrative Agent):
5_________ __, ____


                              Assignors


                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



--------
5        This  date  should be no  earlier  than five  Business  Days  after the
         delivery of this Assignment and Acceptance to the Administrative Agent.



<PAGE>   185


                                        4

                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   Domestic Lending Office:


                                   Eurocurrency Lending Office:





<PAGE>   186


                                        5

                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   Domestic Lending Office:


                                   Eurocurrency Lending Office:



                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   Domestic Lending Office:


                                   Eurocurrency Lending Office:




                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   Domestic Lending Office:


                                   Eurocurrency Lending Office:






<PAGE>   187


                                        6

                                   ______________________, as Assignor

                                   By________________________________________
                                      Title:

                                   Dated:  _________ __, ____



                                   Domestic Lending Office:


                                   Eurocurrency Lending Office:






Accepted 6[and Approved] this ____
day of ___________, ____

CITICORP USA, INC.,
     as Administrative Agent


By_________________________________
    Title:

7[Approved this ____ day
of _____________, ____

HANDY & HARMAN


By_________________________________
    Title:  ]

--------
6        Required if the  Assignee is an Eligible  Assignee  solely by reason of
         clause (a)(viii) or (b) of the definition of "Eligible Assignee".
7        See footnote 6.