Document:

BANC  ONE  CAPITAL  MARKETS,  INC.
a  subsidiary  of  BANK  ONE  Corporation     1

                  ENERGIZER HOLDINGS, INC. SPIN-OFF TERM SHEET
                  --------------------------------------------

                                February 16, 2000

This  Term  Sheet  is  delivered with a Commitment Letter of even date herewith.
Capitalized  terms  used  herein and not otherwise defined herein shall have the
meanings  set  forth  in  Annex  I  attached  hereto  and  in  the  Commitment.
                          --------
                   *                    *                   *

This Term Sheet is intended as an outline only and does not purport to summarize
all  the conditions, covenants, representations, warranties and other provisions
which  would  be  contained  in definitive legal documentation for the financing
contemplated  hereby.  The  commitment of the Administrative Agent and the other
Lenders  is subject to negotiation and execution of definitive Loan Documents in
form  and substance satisfactory to the Lenders and their respective counsel. In
addition,  the  organizational  structure  of  the  Company  after  the Spin-Off
Transactions,  the  form  and  structure  of  the  Spin-Off Transactions and the
financial, legal, accounting, tax and all other aspects of the transaction which
is  the subject hereof shall be satisfactory to the Administrative Agent and the
Lenders  and  their  respective  counsel.

BORROWER:          The  initial  borrower  will  be  Ralston  Purina  Company
("RALSTON");  provided  that  the  financing  shall  be  provided  to  Ralston
immediately  prior to and not sooner than two calendar days prior to the date of
the  consummation of the "Spin-Off" (as defined below).  Simultaneously with the
consummation  of  the  Spin-Off,  all  of  the  indebtedness,  obligations  and
liabilities  of Ralston under the Loan Documents will assigned to and assumed by
Energizer  Holdings,  Inc.  ("ENERGIZER"  or the "COMPANY") and Ralston shall be
released  from  any liability in connection with the Credit Agreement (the "DEBT
ASSUMPTION").

TRANSACTION:          Ralston,  of  which  the  Company  is  a  wholly-owned
subsidiary,  has indicated its intention to distribute the shares of the Company
to  Ralston's shareholders in a tax-free transaction (the "SPIN-OFF"), following
which  all of the Company's shares will be held by Ralston's shareholders at the
time of the Spin-Off.  Ralston and the Company have indicated their intention to
close  financing facilities, in addition to the Facilities, which may consist of
a  bridge  facility or facilities made available to Ralston, all or a portion of
which  may  be assumed by the Company as part of the Spin-Off, and which will be
refinanced  shortly  after the effective date of the Spin-Off with a receivables
securitization  facility  made  available  to  the  Company (the "SECURITIZATION
FACILITY")  and/or  a private placement of the Company's senior unsecured notes,
pari passu with the Facilities (the "SENIOR NOTES").  The Facilities, the bridge
facilities,  the  Securitization  Facility, the Senior Notes and other financing
facilities  entered  into  in  connection  with  or  following  the Spin-Off are
collectively  referred to herein as the "FINANCING FACILITIES".  The proceeds of
the  Financing  Facilities  will  be used: (a) prior to the Debt Assumption, for
Ralston's  general  corporate  purposes;  and  (b) thereafter, for the Company's
general  corporate  purposes,  including  to finance friendly acquisitions.  The
definitive  legal structure of the Spin-Off, the amount, structure and nature of
the  Financing  Facilities  (other  than the Facilities), including the entities
obligated  thereon  and  the  amount  assumed  by  the Company from Ralston, the
various transactions and transitional provisions between Ralston and the Company
and  the  related  transactions (collectively, the "SPIN-OFF TRANSACTIONS") have
not  yet  been finally determined and must be satisfactory to the Administrative
Agent.  Without  limiting  the  foregoing,  the  aggregate  amount  of committed
financing  available  to  the  Company  (or  to Ralston and to be assumed by the
Company)  under the Financing Facilities, including the Facilities, shall not be
less  than  $650  million.

          Each existing and future "Material Domestic Subsidiary" of the Company
(other  than  the  special  purpose  subsidiaries  in  connection  with  the
Securitization Facility (the "SPVS")) shall unconditionally guarantee all of the
indebtedness,  obligations  and  liabilities  of the Company arising under or in
connection with the Loan Documents.  "MATERIAL DOMESTIC SUBSIDIARY" shall mean a
direct  or  indirect  subsidiary  of the Company organized under the laws of any
jurisdiction  of  the United States if such subsidiary's assets comprise greater
than  3%  of  the  consolidated  domestic  assets  (excluding the SPVs from such
calculation)  of  the  Company  and  its  subsidiaries.

          Not  more  than  10%  of  the  Company's  consolidated domestic assets
(excluding  the  SPVs  from such calculation) shall be in subsidiaries which are
not  guarantors.

SUBSIDIARY  GUARANTIES:          Prior  to  the  consummation  of  the  Debt
Assumption,  each  of  the Company and its Material Domestic Subsidiaries (other
than  the  SPVs)  shall  unconditionally  guarantee  all  of  the  indebtedness,
obligations  and  liabilities of Ralston arising under or in connection with the
Loan  Documents.

LEAD  ARRANGER  AND
SOLE  BOOK  MANAGER:          Banc  One  Capital  Markets,  Inc.  ("BOCM" or the
"ARRANGER").

ADMINISTRATIVE  AGENT:          Bank  One,  NA, with its main office in Chicago,
Illinois  ("BANK  ONE"  or  the  "ADMINISTRATIVE  AGENT").

LENDERS:          A  syndicate  of Lenders selected by BOCM in consultation with
the  Company  (the  "LENDERS").

DOCUMENTATION:          The  Facilities  will be evidenced by one or more credit
agreements  (collectively,  the  "CREDIT  AGREEMENT"), guarantees and other loan
documents (collectively, the "LOAN DOCUMENTS") mutually satisfactory to Ralston,
the  Company  and  the  Lenders.

SYNDICATION  MANAGEMENT:          The  Arranger  will,  in consultation with the
Company,  manage  all  aspects of the syndication including, without limitation,
the  timing  of  offers  to  potential Lenders, the amounts offered to potential
Lenders,  the  acceptance  of  commitments,  and  the compensation provided. The
Arranger  shall,  in  consultation  with  the  Company, allocate the commitments
received  from  the  Lenders.

LENDER  COMMITMENTS:          Allocation  of  the  commitments received from the
various  Lenders  shall  be  made  by  the  Arranger  pro  rata among the 5-Year
                                                      ---  ----
Revolving Credit Facility (as defined below) and the 364-Day Credit Facility (as
defined  below).

                                 THE FACILITIES

FACILITIES:

 AGGREGATE  AMOUNT:          Up  to  $450  million (the "AGGREGATE COMMITMENT").

<PAGE>

PURPOSE:          Prior  to the Debt Assumption, for Ralston's general corporate
purposes  and  thereafter  for  the  Company's  general  corporate  purposes and
friendly  acquisitions.

                             364-DAY CREDIT FACILITY
                             -----------------------

 FACILITY  A:          364-day  credit  facility with a one year term out option
(the  "364-DAY  CREDIT  FACILITY").

 AMOUNT:          Up  to  $225  million.

          364  days after the date of execution of the Loan Documents (such date
of  execution,  the  "CLOSING  DATE").
MATURITY:
          Not  more than 59 days and not less than 30 days before the end of the
applicable  364-day period, the Company may request in writing that the maturity
date  for the expiring 364-Day Credit Facility be extended for an additional 364
days.  Within 20 days after such extension request, each Lender may, in its sole
discretion,  agree  to  such  extension  by giving written notice thereof to the
Company  and  the  Administrative  Agent (and the failure to provide such notice
shall  be  deemed to be a declination of such consent).  Subject to the Required
Lenders  agreeing  to extend, the then applicable expiration date of the 364-Day
Credit  Facility  shall,  following  an extension request, be extended for those
consenting  Lenders  by  364  days.  The  Company  reserves the right to replace
dissenting  Lender(s)  with  existing  or  new  Lenders.
EXTENSION:
CONVERSION
TO  TERM  LOAN:          At  the  Company's  option  upon  written notice to the
Administrative  Agent  (who  shall  promptly  notify  each  of the Lenders), the
Company  may  convert  the aggregate outstanding principal amount of the 364-Day
Credit  Facility  to  a term loan having a maturity not more than 364 days after
the  conversion  date  identified  in  such  notice.

<PAGE>

                        5-YEAR REVOLVING CREDIT FACILITY
                        --------------------------------

     FACILITY  B:          5-year  revolving  credit  facility  (the  "5-YEAR
REVOLVING  CREDIT  FACILITY")

     AMOUNT:          Up  to  $225  million.

MATURITY:
          5  years  from  the  Closing  Date.
          $10,000,000 of the 5-Year Revolving Credit Facility shall be available
for  the  issuance of standby letters of credit (the "LETTERS OF CREDIT") by the
Administrative  Agent  or  by any other Lender (each such Lender an "ISSUER") at
the  request  and  for  the  account  of  the  Company.

          No  Letter  of Credit shall have an expiry date later than the earlier
of  (a)  one year after the date of issuance and (b) five business days prior to
final maturity of the 5-Year Revolving Credit Facility; provided that any Letter
                                                        --------
of  Credit  with  a  one-year  tenor  may  provide  for  the renewal thereof for
additional  one-year  periods  (which  shall  in no event extend beyond the date
referred  to  in  clause  (b)  above).
                  -----------

LETTER  OF  CREDIT  SUBFACILITY:          Immediately  upon the issuance of each
Letter  of  Credit,  each  Lender  shall  be  deemed  to  have automatically and
unconditionally purchased and received from the Issuer an undivided interest and
participation in and to such Letter of Credit, the obligations of the Company in
respect  thereof, and the liability of the Issuer thereunder, in an amount equal
to  the  face  amount  of  such  Letter  of  Credit  multiplied by such Lender's
commitment  percentage  under  the  5-Year  Revolving  Credit  Facility.

          The  Administrative  Agent  may  elect  in its sole discretion to make
swingline loans to the Company under the 5-Year Revolving Credit Facility not to
exceed $10 million in the aggregate outstanding at any time, which are repayable
with  interest  within 5 business days.  All swingline loans shall bear interest
for  the  account of the Administrative Agent at the Alternate Base Rate or such
other rate as may be agreed to between the Company and the Administrative Agent.
The amount available under the 5-Year Revolving Credit Facility shall be reduced
by  the  amount  of  the  swingline  usage.
SWING  LINE
SUBFACILITY:          At  any  time at the option of the Administrative Agent or
if  any  swingline  loan is not repaid by the Company on the date when due, each
Lender will make a revolving loan under the 5-Year Revolving Credit Facility the
proceeds  of  which  will  be  used  to repay the swingline loan or, if any such
revolving  credit  loan  may  not  be  made,  irrevocably  purchase  from  the
Administrative  Agent,  without  recourse or warranty, such participation in the
swingline  loan as shall be necessary to cause each such Lender to share ratably
in  such  swingline  loan.

                                   OTHER TERMS
                                   -----------

                               LIBOR, adjusted for reserves.
                                   Alternate Base Rate.

           LIBOR loans will be available for interest periods of one, two, three
or six months and, to the extent available, nine or twelve months.  All interest
              on LIBOR loans will be calculated on a 360-day basis.

            The "ALTERNATE BASE RATE" means the greater of (i) the prime rate of
   interest announced from time to time by Bank One or its parent (which is not
 necessarily the lowest rate charged to any customer) changing when and as said
 rate changes or (ii) the federal funds rate plus  %.  All interest in Alternate
           Base Rate loans will be calculated on a 365/366-day basis.

<PAGE>
BORROWING  OPTIONS:
          "LIBOR"  means  the  applicable  London  Interbank  Offered  Rate  for
deposits  in  U.S.  Dollars  appearing  on  Reuters Screen FRBD as of 11:00 a.m.
(London  Time)  two  business  days  prior  to  the  first day of the applicable
interest  period,  adjusted  for  reserves.

INCREASED COSTS:          The Credit Agreement will contain customary provisions
regarding  availability,  increased  costs  (including  capital  cost  increases
imposed  by  regulatory  authorities),  illegality  and  early  payment.

          Pricing  on the commitments and loans (including after exercise of the
term-out  option, if applicable) will be at the rates, expressed in basis points
per  annum,  set  out  in  the  attached  pricing grids (the "PRICING GRID") and
varying  according  to  the  pricing  level  commensurate  with  credit quality.
PRICING:

<PAGE>
FACILITY  FEE:          The  Company  shall  pay a per annum fee calculated on a
360-day  basis  payable  on  each  Lender's  commitment,  irrespective of usage,
quarterly  in  arrears and on termination of the applicable Facility at the rate
set  out  in  the  Pricing  Grid.

          Ralston  shall pay or shall cause the Company to pay such fees payable
to  the Administrative Agent and the Arranger as are specified in the fee letter
dated February 9, 2000 among the Administrative Agent, the Arranger, Ralston and
the  Company.
OTHER  FEES:
          Standby  Letters  of  Credit:  The  Company  shall  pay  to  the
          ----------------------------
Administrative  Agent  for  the  ratable account of the Lenders under the 5-Year
          ---
Revolving  Credit  Facility  a  per  annum  Letter  of  Credit  Fee equal to the
applicable LIBOR Margin for the 5-Year Revolving Credit Facility as reflected in
the Pricing Grid, payable quarterly on the average daily outstanding face amount
available for drawing under all standby Letters of Credit which have been issued
under  the  Facilities.

          Fronting  Fee.  In  addition,  for  each  Letter of Credit a Letter of
          -------------
Credit  fronting  fee  will be payable by the Company to the Issuer for its sole
account  in  such  amount  as  is  negotiated  with  the  Issuer.

          Customary  Charges.  The  Company  shall  pay  to  the  Issuer  its
          ------------------
documentary  and  processing  charges  in  accordance with the Issuer's standard
schedule for such charges with respect to the issuance, amendment, cancellation,
negotiation  or  transfer  of  each  Letter  of  Credit  and  each  drawing made
thereunder.
LETTER  OF  CREDIT  FEES:

<PAGE>
DEFAULT  RATE:          After  a Default and upon notice from the Administrative
Agent  or  the  Required  Lenders,  the interest rates will be equal to the then
highest  rate (or fee) under the various Facilities plus 2% per annum; provided,
                                                    ----               --------
that  during  the  continuation  of a bankruptcy or insolvency default such rate
increase  shall  be applicable without any election or action on the part of the
Administrative  Agent  or  the  Lenders.

DRAWDOWNS:          Minimum amounts of $10 million with additional increments of
$1  million.  After  the  initial  drawdown  by  Ralston,  drawdowns  are at the
Company's option with one business days notice for Alternate Base Rate Loans and
three  business  days  for  LIBOR  Loans.

VOLUNTARY  PREPAYMENTS:          Alternate Base Rate Loans may be prepaid at any
time  on one business days notice.  LIBOR Loans may be prepaid before the end of
an  interest  period on three business days notice subject to payment of funding
indemnification  and  breakage  costs.

TERMINATION  OR REDUCTION OF COMMITMENTS:          The Company may terminate the
unused  commitments  in  amounts  of  at  least $25 million at any time on three
business  days  written  notice.

                             CONDITIONS OF BORROWING

          The  Credit  Agreement  will contain customary conditions to each loan
(including,  but  not  limited  to,  absence  of  default  or unmatured default,
continued  accuracy  of  representation  and warranties, and absence of material
litigation).
CONDITIONS  TO  EACH  LOAN:
          Additional  conditions  precedent to initial loan under the Facilities
will  include,  without  limitation:

          -  The  delivery  of  satisfactory  loan  and other closing documents,
including  but  not limited to the Credit Agreement, the guaranties, appropriate
resolutions, good standing certificates, incumbency certificates, no-default and
compliance  certificates  and  opinions  of  counsel;

          -  No  material  adverse  change from the information set forth in the
Form  10  filed  January  11,  2000  and  the  projections and other information
provided  to  the  Administrative  Agent  and  the  Lenders;

          -  Evidence  that  all  conditions  to  consummation  of  the Spin-Off
Transactions  have occurred and that the aggregate amount of committed Financing
Facilities  (including  hereunder)  is  not  less  than  $650  million;

          -  The  Company  shall  having  received  all necessary regulatory and
corporate  approvals  for  the consummation of the Spin-Off Transactions and the
Financing  Facilities;

          -  The Administrative Agent and the Lenders shall have received and be
satisfied  with  the  pro  forma post-Spin-Off Transactions consolidated balance
sheet  and  financial  projections of the Company and its subsidiaries, together
with  a  chief  financial officer's solvency certificate for the Company and its
subsidiaries  post-Spin-Off  Transactions  which  is  satisfactory  in  form and
substance  to  the  Administrative  Agent  and  the  Lenders  and which shall be
consistent  with  the information delivered to the Administrative Agent prior to
the  date  hereof  and  to  the  other  Lenders  prior  to their issuance of any
commitments.

          -  The  Administrative  Agent  and the Lenders shall be satisfied with
the  capitalization  of  the  Company  and  its  subsidiaries  post-Spin-Off
Transactions.  Without  limiting the foregoing, net worth of the Company and its
consolidated  subsidiaries  as  of  and  after  the consummation of the Spin Off
Transactions  shall  not be less than a minimum amount to be agreed upon between
the  Administrative  Agent  and  the  Company  prior  to  the  commencement  of
syndication.
CONDITIONS  TO  INITIAL  LOAN:

                         REPRESENTATIONS AND WARRANTIES

The  Credit  Agreement  shall  contain  a  representation  regarding no material
adverse  change only upon the signing and initial funding.  The Credit Agreement
shall  also  contain  representations and warranties with respect to the Company
and  its  subsidiaries  to be made as of the Closing Date and in connection with
each  loan  and letter of credit issuance which are customary in transactions of
this nature, including, representations and warranties with respect to:  absence
of default or unmatured default; corporate existence and standing; authorization
and  validity;  no  conflict;  government  consent; financial statements; taxes;
litigation  and  contingent  obligations;  subsidiaries;  ERISA;  accuracy  of
information;  Regulation U; material agreements; compliance with laws; ownership
of property; insurance; environmental matters; Investment Company Act and Public
Utility  Holding  Company  Act.

<PAGE>

                                    COVENANTS

The  Credit  Agreement  will have customary covenants, including but not limited
to:

          -  Annual  certified  audited consolidated and consolidating financial
statements  of  the Company and its consolidated subsidiaries due within 90 days
after  each  fiscal  year;

          -  Quarterly  certified unaudited consolidated financial statements of
the  Company  and its consolidated subsidiaries due within 45 days after each of
the  first  three  fiscal  quarters;  and

          -  Quarterly  no  default  certificate  signed  by the Chief Financial
Officer  or  Treasurer  and  delivered  with  the  financial  statements.
FINANCIAL  REPORTING:
          -  Securitization  Attributed Indebtedness not to exceed $250 million.
SECURITIZATION  FACILITY:
          -  Subsidiary  Indebtedness  (not  including  the  Securitization
Attributed  Indebtedness)  not  to  exceed  $250  million.
SUBSIDIARY  INDEBTEDNESS:
          -  No  other  restriction  on  Indebtedness  of  the  Company  and its
Subsidiaries,  except for those restrictions imposed by the financial covenants.
INDEBTEDNESS  GENERALLY:
          -  Asset  sales  will  be  limited to 20% of consolidated total assets
during  the  term  of  the  Facilities.
ASSET  SALES:
          Acquisitions  will  be  permitted  provided:

          -  At  the  time  thereof  there  is no Default or  Unmatured Default.

          -  The acquisition is consummated pursuant to a negotiated acquisition
agreement  on  a non-hostile basis pursuant to an acquisition agreement approved
by the board of directors or other applicable governing body of the seller prior
to  the  commencement  thereof.

          -  The Company is in pro forma compliance with the financial covenants
                               --- -----
for  the  twelve-month  period  ending  on  the  last  day of the Company's most
recently  completed  fiscal  quarter  as if such acquisition had occurred on the
first  day  of  such  twelve-month  period.

          -  After  giving  effect  to such acquisition, the representations and
warranties  set  forth  in the Credit Agreement shall be true and correct in all
material  respects.

          -  The  target  companies  shall  be companies operating in businesses
similar  to  or  related  to  the current and future businesses conducted by the
Company  and  its  subsidiaries,  as  well  as  suppliers  to or distributors of
products  similar  to  those  of  the  Company  and  its  subsidiaries; provided
acquisitions outside of such lines of business shall be permitted so long as the
aggregate  purchase price for all such acquisitions does not exceed five percent
(5.0%)  of  the  Company's  consolidated  tangible  net  assets.
PERMITTED  ACQUISITIONS:
          Negative  pledge against encumbering any assets of the Company and its
subsidiaries  except:

          -  Customary  permitted  liens.

          -  Liens  in  connection  with  the  Securitization  Facility.

          -  Basket  to  permit  other  secured indebtedness not to exceed 5% of
consolidated  total  assets.
NEGATIVE  PLEDGE:
          Customary  affirmative  covenants including: notice of Default, taxes,
insurance,  compliance  with  laws,  maintenance  of  properties, maintenance of
insurance,  keeping  of  books  and  records,  inspection.

          Customary  negative  covenants  including,  without  limitation,
restrictions  on  investments,  sale  leasebacks,  use of proceeds, mergers, and
non-arm's  length  transactions  with  affiliates  and  with Ralston (subject to
exceptions  to  be  agreed  upon).
OTHER  COVENANTS:

FINANCIAL  COVENANTS:
     The  following  financial  covenants  shall be calculated on a consolidated
basis  for  the  Company  and  its  Subsidiaries:

     Maximum  Consolidated Total Debt/ EBITDA Ratio:  At no time shall the ratio
     ----------------------------------------------
of  total  indebtedness  of  the  Company  and  its  Subsidiaries  (including
Securitization  Attributed  Indebtedness)  at  the  end  of  the  most  recently
completed  fiscal  quarter  to  EBITDA  of  the  Company  and  its  consolidated
subsidiaries for the Company's then most recently completed four fiscal quarters
exceed  3.0  to  1.0.

     Minimum  Interest Coverage Ratio:  The ratio of (a) EBIT of the Company and
     --------------------------------
its  consolidated  subsidiaries  for  the Company's then most recently completed
four  fiscal  quarters  to  (b)  total  interest  expense of the Company and its
consolidated  subsidiaries,  adjusted  by  adding  thereto  (to  the  extent not
otherwise  included  therein)  the amount of all cash fees, service charges, and
other  costs, as well as all collections or other amounts retained by purchasers
of  assets  pursuant  to Securitization Facility, which are in excess of amounts
paid  to  the Company and its consolidated subsidiaries under the Securitization
Facility for the purchase of assets pursuant to such Securitization Facility and
are the equivalent of the interest component of the financing if the transaction
were characterized as an on-balance sheet transaction shall be greater than 3.00
to  1.00 as of the end of  each fiscal quarter (calculated as of the end of each
such  fiscal  quarter  for  the four-fiscal quarter period ending on such date).

                                    DEFAULTS

The  Agreement  will  have  customary  defaults  including,  but not limited to,
defaults  for  nonpayment of principal when due, nonpayment of interest and fees
within  5  days,  material misrepresentations, default in the performance of any
negative covenant, default in the performance of any financial covenant, default
in  performance  of  any  other  term  or  covenant  (with  grace periods, where
applicable,  to  be  agreed  upon), bankruptcy or insolvency, ERISA, a change in
ownership  or  control,  unstayed  judgment  in  excess  of  $30  million  and
cross-default  to  any  indebtedness equal to or in excess of $30 million in the
aggregate  for  the  Company  or  any subsidiary, which default would permit the
holders  of  such indebtedness to cause such indebtedness to become due prior to
its  stated  maturity.

Change  in ownership or control would be defined as an event or series of events
by  which: (i) any "person" or "group" (within the meaning of Sections 13(d) and
14(d)(2)  of the Securities Exchange Act of 1934) becomes the "beneficial owner"
(as  defined  in Rule 13d-3 under the Securities Exchange Act of 1934), directly
or  indirectly,  of thirty percent (30%) or more of the voting power of the then
outstanding  capital  stock  of  the  Company  entitled to vote generally in the
election  of  the  directors  of  the  Company;  (ii)  during  any  period of 12
consecutive  calendar  months, the board of directors of the Company shall cease
to have as a majority of its members individuals who either: (a)  were directors
of  the  Company  on  the  first  day  of  such  period, or (b)  were elected or
nominated  for  election  to  the  board  of  directors  of  the  Company at the
recommendation of or other approval by at least a majority of the directors then
still in office at the time of such election or nomination who were directors of
the Company on the first day of such period, or whose election or nomination for
election  was  so  approved;  (iii)  other than as a result of a transaction not
prohibited  under  the terms of the Credit Agreement, the Company shall cease to
own,  of  record  and  beneficially, with sole voting and dispositive power, (a)
100% of the outstanding shares of Capital Stock of each of the guarantors or (b)
shall  cease  to  have  the  power,  directly or indirectly, to elect all of the
members  of  the  board  of  directors  of  each of the guarantors; or (iv)  the
Company  consolidates  with  or  merges  into  another  corporation  or conveys,
transfers  or  leases all or substantially all of its property to any person, or
any  corporation  consolidates  with or merges into the Company, in either event
pursuant  to a transaction in which the outstanding Capital Stock of the Company
is  reclassified  or  changed  into  or  exchanged for cash, securities or other
property.

                                  OTHER MATTERS

          Assignments:  Each  Lender  may,  in  its  sole  discretion,  sell
          -----------
participations and may, in a manner acceptable to the Administrative Agent, sell
assignments  in  the loans and in its commitment and disclose public information
to  prospective  participants  and assignees, and share, at its option, any fees
with such participants and assignees.  Nonpublic information may be disclosed to
prospective participants and assignees; provided such participants and assignees
agree  to  be  bound  by  the confidentiality provisions set forth in the Credit
Agreement  with  respect  thereto.

          Consents:  Assignments  under  the  5-Year  Revolving  Credit Facility
          --------
and/or  the 364-Day Credit Facility shall require the consent of the Company and
the  Administrative  Agent  (such  consents  not  to  be unreasonably withheld);
provided,  the  consent of the Company shall not be required (i) if a Default or
      --
Unmatured  Default  shall  have  occurred  and  is  continuing  and  (ii) if the
assignment  is  to  another  Lender  or  to  an  affiliate  of  a  Lender.

          Minimum:  Assignments shall be in minimum amounts of $5,000,000 or the
          -------
entire  remaining  balance  of  the assigning Lender's commitment or such lesser
amount  as  may  be  acceptable  to  the  Administrative  Agent  and the Company
(provided  the  consent of the Company shall not be required to any reduction of
such  minimum  amount  so  long  as  a  Default  or Unmatured Default shall have
occurred  and  be  continuing).

ASSIGNMENTS/ PARTICIPATIONS:          Assignment Fee:  The assignor shall pay an
                                      --------------
assignment  fee  of  $3,500 to the Administrative Agent upon any assignment by a
Lender  of  its  rights and obligations under the Facilities (including, but not
limited  to,  an  assignment  by  a  Lender to another Lender, but excluding any
assignment  by  a  Lender  to  an  affiliate  of  such  Lender).

REQUIRED  LENDERS:          "REQUIRED LENDERS" means, with respect to the 5-Year
Revolving  Credit  Facility  and  the  364-Day  Credit Facility, Lenders holding
greater  than  50%  of  the  commitments  under  each  such Facility, or, if the
commitments  have  been terminated under such Facility, of the outstanding loans
under  such  Facility.

EXPENSES:          The  Company  agrees  to  reimburse or pay the Administrative
Agent  for all reasonable costs, fees and expenses, whether incurred prior to or
subsequent  to  closing,  in  the  preparation,  negotiation,  execution  and
administration  of  the Credit Agreement and the other Loan Documents, including
reasonable  fees  and  time  charges  of  legal  counsel.

GOVERNING  LAW:          Illinois.

COUNSEL  TO  THE  ADMINISTRATIVE  AGENT:          Sidley  &  Austin.<PAGE>

                                                                   EXHIBIT 10(Y)

                      SPECIAL OFFER RETIREE MEDICAL PLAN
                      ----------------------------------

                                   ARTICLE I

                           Eligibility and Benefits
                           ------------------------

1.01  Purpose.  The purpose of the Special Officer Retiree Medical Plan ("Plan")
      -------
      is to provide lifetime retiree medical benefits to eligible elected
      officers of Northrop Grumman Corporation ("the Company") and their
      spouses.

1.02  Eligibility.  Eligibility for benefits under this Plan will be limited to
      -----------
      those elected officers of the Company listed in Exhibit A. Officers may be
      added or removed from Exhibit A in accordance with the amendment provision
      of the Plan.

      (a)  An elected officer listed in Exhibit A is a "Participant" under the
      Plan.

      (b)  A Participant will become an "Eligible Participant" under the Plan
      if he or she has either five years of service as an elected officer or 30
      years of total service with the Company and its affiliates.

1.03  Benefits.  The Company will provide an Eligible Participant with a
      --------
      continuation of medical benefits.

      (a)  The benefits will be provided for the life of the Eligible
           Participant and the life of his or her surviving spouse, if any. (The
           only spouse covered will be a surviving spouse who is married to the
           Eligible participant both at the time of termination of employment
           with the Company and its affiliates and at the time of the Eligible
           Participant's death.

      (b)  The benefits provided will be a continuation of the medical benefits
           the Eligible Participant was eligible to receive from the Company as
           of December 31, 1998. In particular, the following will remain frozen
           as of that date:

           (1)  Participant contributions.

           (2)  Copayments.

           (3)  Deductibles.

           (4)  Medical benefit coverage.

      (c)  Following the death of the Eligible Participant or his or her spouse,
           the participant contributions, copayments and deductibles will be
           adjusted to what they would have been for the Eligible participant
           for individual coverage as of December 31, 1998.
<PAGE>

      (d)  The benefits under the Plan will be coordinated with and paid
           secondary to any benefits that the Eligible Participant or his or her
           spouse receives from another plan of the Company or another employer
           or from Medicare (For this purpose, Medicare benefits are deemed to
           include any benefits the Eligible Participant and his or her spouse
           would receive from Medicare if they made proper application for
           benefits.)

                                   ARTICLE 2

                               General Provisions
                               ------------------

2.01  Amendment and Plan Termination.  The Company may amend or terminate the
      ------------------------------
      Plan with respect to any Participant only with the consent of the
      Participant or, after the Participant's death, with the consent of his or
      her spouse.  Otherwise, the Company may amend the Plan at any time.

2.02  Assignment of Benefits.  An Eligible Participant or surviving spouse may
      ----------------------
      not, either voluntarily or involuntarily, assign, anticipate, alienate,
      commute, sell, transfer, pledge or encumber any benefits to which he or
      she is or may become entitled under the Plan, nor may Plan benefits be
      subject to attachment or garnishment by any of their creditors or to legal
      process.

2.03  Nonduplication of Benefits.  This Section applies if, despite Section
      --------------------------
      2.02, with respect to any Eligible Participant (or his or her spouse), the
      Company is required to make payments under this Plan to a person or entity
      other than the payees described in the Plan.  In such a case, any coverage
      due the Participant (or his or her spouse) under the Plan will be reduced
      by the actuarial value of the coverage extended or payments made to such
      other person or entity.

2.04  Funding.  Participants have the status of general unsecured creditors of
      -------
      the Company and the Plan constitutes a mere promise by the Company to make
      benefit payments in the future.  Any funding of benefits under this Plan
      will be in the Company's sole discretion.

2.05  Construction.  The Company shall have full discretionary authority to
      ------------
      determine eligibility and to construe and interpret the terms of the Plan,
      including the power to remedy possible ambiguities, inconsistencies or
      omissions.

2.06  Governing Law.  This Plan shall be governed by the law of the State of
      -------------
      California, except to the extent superseded by federal law.

2.07  Actions By Company.  Any powers exercisable by the Company under the Plan
      ------------------
      shall be utilized by written resolution adopted by the Board of Directors
      of the Company or its delegate. The Board may be written resolution
      delegate any of the Company's powers under the Plan and any such
      delegations may provide for subdelegations, also by written resolution.

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