CREDIT AGREEMENT

BETWEEN

NEWCOR, INC.

AND ITS SUBSIDIARIES

AND

NATIONAL CITY BANK OF MICHIGAN/ILLINOIS,

Individually and as Agent for NATIONAL CITY BANK

Dated as of February 20, 2004

TABLE OF CONTENTS

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LIST OF EXHIBITS

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CREDIT AGREEMENT

THIS CREDIT AGREEMENT, dated as of February 20, 2004 (the Credit Agreement), is by and among NEWCOR, INC., a Delaware corporation (Borrower), the other parties identified on the signature pages hereto as Guarantors and such other parties as may from time to time become a party hereto (Guarantors), and NATIONAL CITY BANK OF MICHIGAN/ILLINOIS, a national banking association, Individually and as agent for NATIONAL CITY BANK, a national banking association (Lender).

W I T N E S S E T H :

WHEREAS, Borrower and Guarantors have requested that Lender provide certain credit facilities for the purposes hereinafter set forth; and

WHEREAS, Lender has agreed to make the requested credit facilities available to Borrower on the terms and conditions hereinafter set forth.

NOW, THEREFORE, IN CONSIDERATION of the premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

SECTION 1.

DEFINITIONS

1.1 Definitions. As used in this Credit Agreement, the following terms shall have the meanings specified below unless the context otherwise requires:

Accounts As defined in the Uniform Commercial Code.

Additional Guarantor means each Person that becomes a Guarantor after the Closing Date by execution of a Joinder Agreement in accordance with Section 6.9.

Advance As defined in the Revolving Credit Loan Note.

Affiliate means, with respect to any Person, any other Person (i) directly or indirectly controlling or controlled by or under direct or indirect common control with such Person or (ii) directly or indirectly owning or holding ten percent (10%) or more of the equity interest in such Person. For purposes of this definition, control when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms controlling and controlled have meanings correlative to the foregoing.

Applicable Interest Addition As defined in the Note.

Borrower means Newcor, Inc., a Delaware corporation, the owner of one hundred percent (100%) of all outstanding stock of each of the Subsidiaries.

Business Day means a day other than a Saturday, Sunday or other day on which commercial banks in Wisconsin, Illinois or Michigan are closed.

Capital Expenditures means all expenditures which in accordance with GAAP would be classified as capital expenditures, including, without limitation, Capital Lease Obligations.

Capital Lease means any lease of property, real or personal, the obligations with respect to which are required to be capitalized on a balance sheet of the lessee in accordance with GAAP.

Capital Lease Obligation means, as of any Test Date, the obligations under a Capital Lease as of such Test Date determined in accordance with GAAP.

Cash Equivalents means (a) securities issued or directly and fully guaranteed or insured by the United States of America or any agency or instrumentality thereof (provided that the full faith and credit of the United States of America is pledged in support thereof) having maturities of not more than twelve months from the date of acquisition, (b) U.S. dollar denominated time deposits and certificates of deposit of (i) any Lender, (ii) any domestic commercial bank of recognized standing having capital and surplus in excess of $500,000,000 or (iii) any bank whose short-term commercial paper rating from S&P is at least A-l or the equivalent thereof or from Moodys is at least P-l or the equivalent thereof (any such bank being an Approved Lender), in each case with maturities of not more than 364 days from the date of acquisition, (c) commercial paper and variable or fixed rate notes issued by any Approved Lender (or by the parent company thereof) or any variable or fixed rate notes issued by, or guaranteed by, any domestic corporation rated A-l (or the equivalent thereof) or better by S&P or P-l (or the equivalent thereof) or better by Moodys and maturing within six months of the date of acquisition, (d) repurchase agreements with a bank or trust company (including Lender) or recognized securities dealer having capital and surplus in excess of $500,000,000 for direct obligations issued by or fully guaranteed by the United States of America in which Borrower shall have a perfected first priority security interest (subject to no other Liens) and having, on the date of purchase thereof, a fair market value of at least 100% of the amount of the repurchase obligations, (e) obligations of any State of the United States or any political subdivision thereof, the interest with respect to which is exempt from federal income taxation under Section 103 of the Code, having a long term rating of at least Aa-3 or AA- by Moodys or S&P, respectively, (f) investments in municipal auction preferred stock (i) rated AAA or the equivalent thereof) or better by S&P or Aaa (or the equivalent thereof) or better by Moodys and (ii) with dividends that reset at least once every 365 days and (g) investments, classified in accordance with GAAP as current assets, in money market investment programs registered under the Investment Company Act of 1940, as amended, which are administered by reputable financial institutions having capital of at least $100,000,000 and the portfolios of which are limited to investments of the character described in the foregoing subdivisions (a) through (f).

Change of Control means (x) the failure of EXX, Inc. and its Affiliates to own in the aggregate fifty-one percent (51%) of the voting power of the total outstanding voting stock of Borrower or (y) a Change of Control as defined in the Senior Notes Indenture.

Closing Date means the date on which all of the conditions set forth in Section 4.1 have been satisfied.

Code means the Internal Revenue Code of 1986, as amended from time to time.

Collateral As defined in Section 2.4.

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