NL INDUSTRIES INC
INTERCORPORATE SERVICES AGREEMENT - CONTRAN
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>3
<FILENAME>nlform_10q1q2002ex10-1.txt
<DESCRIPTION>INTERCORPORATE SERVICES AGREEMENT - CONTRAN
<TEXT>
                                                                    EXHIBIT 10.1

                        INTERCORPORATE SERVICES AGREEMENT

        This INTERCORPORATE  SERVICES AGREEMENT (the "Agreement"),  effective as
of January 1, 2002, amends and supersedes that certain  Intercorporate  Services
Agreement  effective  as of  January  1, 2001  between  CONTRAN  CORPORATION,  a
Delaware  corporation  ("Contran"),  and  NL  INDUSTRIES,  INC.,  a  New  Jersey
corporation ("NL").

                                    Recitals

        A. NL desires to have the  services  of certain  Contran  personnel  and
Contran is willing to provide such services under the terms of this Agreement.

        B. Contran  desires to have the services of certain NL personnel  and NL
is willing to provide such services under the terms of this Agreement.

        C. The  costs of  maintaining  the  additional  personnel  necessary  to
perform the  functions  provided for by this  Agreement  would exceed the amount
charged to such party that is contained in the net fee set forth in Section 4 of
this  Agreement and that the terms of this  Agreement  are no less  favorable to
each party than could  otherwise be obtained  from a third party for  comparable
services.

        D. Each party  desires to  continue  receiving  the  services  presently
provided  by the other  party and its  affiliates  and each  party is willing to
continue to provide such services under the terms of this Agreement.

                                    Agreement

        For and in  consideration of the mutual  premises,  representations  and
covenants  contained  in  this  Agreement,  and  for  other  good  and  valuable
consideration,  the receipt and sufficiency of which is hereby acknowledged, the
parties hereto mutually agree as follows:

        Section 1.  Contran  Services  to be  Provided.  Contran  agrees to make
available to NL, upon request,  the following services (the "Contran  Services")
to be rendered by the internal staff of Contran and affiliates of Contran:

               (a)   Consultation   and  assistance  in  the   development   and
        implementation  of  NL's  corporate  business   strategies,   plans  and
        objectives;

               (b)  Consultation  and  assistance in  management  and conduct of
        corporate affairs and corporate  governance  consistent with the charter
        and bylaws of NL;

               (c)  Consultation  and  assistance  in  maintenance  of financial
        records  and  controls,  including  preparation  and review of  periodic
        financial  statements and reports to be filed with public and regulatory
        entities and those required to be prepared for financial institutions or
        pursuant to indentures and credit agreements;

<PAGE>

               (d)  Consultation  and  assistance  in  cash  management  and  in
        arranging financing necessary to implement the business plans of NL;

               (e)   Consultation   and   assistance  in  tax   management   and
        administration, including, without limitation, preparation and filing of
        tax returns, tax reporting,  examinations by government  authorities and
        tax planning;

               (f) certain  administration and management  services with respect
        to  NL's  insurance  and  risk  management  needs,  including,   without
        limitation, administration of NL's:

                      (i)    property and casualty insurance program,

                      (ii)   claims management program,

                      (iii)  property loss control program; and

               (g) Such other  services as may be  requested  by NL from time to
        time.

        Section 2. NL Services to be  Provided.  NL agrees to make  available to
Contran,   upon  request,   the  following  services  (the  "NL  Services,"  and
collectively  with the Contran  Services,  the "Services") to be rendered by the
internal staff of NL:

               (a) certain  administration  and support services with respect to
        Contran's insurance and risk management needs; and

               (b) Such other  services as may be requested by Contran from time
        to time.

This  Agreement  does not apply to, and the Services  provided for herein do not
include,  any  services  that Harold C.  Simmons,  Glenn R. Simmons or Steven L.
Watson may provide to NL in their roles as members of NL's board of directors or
any other activity related to such board of directors.

        Section  3.  Miscellaneous  Services.  It is the  intent of the  parties
hereto that each party to this Agreement provide (a "Providing Party") only such
Services as are requested by the other party (a "Receiving Party") in connection
with routine management,  financial and administrative  functions related to the
ongoing  operations  of the  Receiving  Party and not with  respect  to  special
projects,  including corporate investments,  acquisitions and divestitures.  The
parties hereto  contemplate  that the Services  rendered by a Providing Party in
connection  with the conduct of each  Receiving  Party's  business  will be on a
scale  compared  to that  existing  on the  effective  date  of this  Agreement,
adjusted  for  internal  corporate  growth  or  contraction,  but not for  major
corporate acquisitions or divestitures,  and that adjustments may be required to
the terms of this Agreement in the event of such major  corporate  acquisitions,
divestitures or special projects. Each Receiving Party will continue to bear all
other costs  required for outside  services  including,  but not limited to, the
outside services of attorneys, auditors, trustees, consultants,  transfer agents
and registrars, and it is expressly understood that each Providing Party assumes
no  liability  for any  expenses  or  services  other than those  stated in this

                                      -2-
<PAGE>

Agreement to be provided by such party.  In addition to the amounts charged to a
Receiving Party for Services provided pursuant to this Agreement, such Receiving
Party will pay the Providing Party the amount of out-of-pocket costs incurred by
the Providing Party in rendering such Services.

        Section  4. Net Fee for  Services.  NL  agrees  to pay to  Contran a net
annual fee of $1,503,000  payable in quarterly  installments of $375,750 each on
the first  business  day of each  quarter,  commencing  as of  January  1, 2002,
pursuant to this Agreement. In addition to the net annual fee:

               (a) Contran shall credit or pay to NL additional amounts plus all
        related out-of-pocket costs, all as agreed to by the parties, for all NL
        Services provided under Subsection 2(b); and

               (b) NL shall credit or pay to Contran additional amounts plus all
        related  out-of-pocket  costs, all as agreed to by the parties,  for all
        Contran Services provided under Subsection 1(f).

        Section 5. Original Term. Subject to the provisions of Section 6 hereof,
the original  term of this  Agreement  shall be from January 1, 2002 to December
31, 2002.

        Section  6.   Extensions.   This  Agreement   shall  be  extended  on  a
quarter-to-quarter  basis  after the  expiration  of its  original  term  unless
written  notification  is given by Contran or NL thirty  (30) days in advance of
the first  day of each  successive  quarter  or  unless  it is  superseded  by a
subsequent written agreement of the parties hereto.

        Section 7.  Limitation of Liability.  In providing  Services  hereunder,
each  Providing  Party shall have a duty to act, and to cause its agents to act,
in a  reasonably  prudent  manner,  but no  Providing  Party  nor  any  officer,
director,  employee or agent of such party nor or its affiliates shall be liable
to a Receiving Party for any error of judgment or mistake of law or for any loss
incurred  by the  Receiving  Party in  connection  with the matter to which this
Agreement relates,  except a loss resulting from willful misfeasance,  bad faith
or gross negligence on the part of the Providing Party.

        Section 8.  Indemnification.  Each Receiving  Party shall  indemnify and
hold harmless the Providing Party, its affiliates and their respective officers,
directors  and  employees  from and  against  any and all  losses,  liabilities,
claims,  damages,  costs  and  expenses  (including  attorneys'  fees and  other
expenses  of  litigation)  to which  such  Providing  Party or person may become
subject  arising out of the  Services  provided by such  Providing  Party to the
Receiving  Party  hereunder,  provided that such indemnity shall not protect any
person against any liability to which such person would  otherwise be subject by
reason of willful misfeasance, bad faith or gross negligence on the part of such
person.

        Section 9.  Confidentiality.  Except as otherwise required by applicable
law,  each of the  parties  agrees  that  it will  maintain  in  confidence  all
confidential  information regarding the other party supplied to it in the course
of the performance of this Agreement.

                                      -3-

<PAGE>

        Section 10. Further Assurances.  Each of the parties will make, execute,
acknowledge and deliver such other instruments and documents,  and take all such
other actions,  as the other party may reasonably  request and as may reasonably
be required in order to effectuate  the purposes of this  Agreement and to carry
out the terms hereof.

        Section 11. Notices.  All  communications  hereunder shall be in writing
and shall be addressed,  if intended for Contran,  to Three Lincoln Centre, 5430
LBJ Freeway,  Suite 1700, Dallas,  Texas 75240,  Attention:  President,  or such
other address as it shall have  furnished to NL in writing,  and if intended for
NL, to Two Greenspoint Plaza, 16825 Northchase Drive, Suite 1200, Houston, Texas
77060, Attention: President, or such other address as it shall have furnished to
Contran in writing.

        Section 12. Amendment and  Modification.  Neither this Agreement nor any
term hereof may be  changed,  waived,  discharged  or  terminated  other than by
agreement in writing signed by the parties hereto.

        Section 13. Successor and Assigns.  This Agreement shall be binding upon
and inure to the benefit of Contran and NL and their  respective  successors and
assigns,  except that neither  party may assign its rights under this  Agreement
without the prior written consent of the other party.

        Section 14.  Governing  Law.  This  Agreement  shall be governed by, and
construed and interpreted in accordance with, the laws of the state of Texas.

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


                                      CONTRAN CORPORATION


                                      By:/s/ Steven L. Watson
                                         ---------------------------------------
                                             Steven L. Watson
                                             President


                                      NL INDUSTRIES, INC.


                                      By:/s/ Robert D. Hardy
                                         ---------------------------------------
                                             Robert D. Hardy
                                             Vice President


                                      -4-

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