
<PAGE>


                              SHAREHOLDER AGREEMENT



          THIS SHAREHOLDER AGREEMENT, dated as of April 1, 1996, by and between
Teledyne, Inc., a Delaware corporation ("TI"), and the shareholder listed on the
signature page hereof (such shareholder being referred to herein as the
"Shareholder");


                                   WITNESSETH:

          WHEREAS, the Shareholder, as of the date hereof, is the owner of or
has the sole right to vote the number of shares of Common Stock, par value $0.10
per share (the "Common Stock"), of Allegheny Ludlum Corporation, a Pennsylvania
corporation (the "Company"), set forth below the name of the Shareholder on the
signature page hereof (the "Shares"); and


          WHEREAS, in reliance upon the execution and delivery of this
Agreement, TI will enter into an Agreement and Plan of Merger and Combination,
dated as of the date hereof (the "Combination Agreement"), with XYZ/Power, Inc.
and the Company which provides, among other things, that upon the terms and
subject to the conditions thereof, the Company and TI will each become a wholly
owned subsidiary of New Corporation (the "Combination"); and


          WHEREAS, to induce TI to enter into the Combination Agreement and to
incur the obligations set forth therein, the Shareholder is entering into this
Agreement pursuant to which the Shareholder agrees to vote in favor of the
Combination and certain other matters as set forth herein, and to make certain
agreements with respect to the Shares upon the terms and conditions set forth
herein;


          NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements set forth herein and for other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, the
parties hereto agree as follows:


          Section 1.  VOTING OF SHARES; PROXY.  (a) The Shareholder agrees that
until the earlier of (i) the Effective Time (as defined in the Combination
Agreement) or (ii) the date on which the Combination Agreement is terminated
(the earliest thereof being hereinafter referred to as the "Expiration Date"),
the Shareholder shall vote all Shares owned by the Shareholder at any meeting of
the Company's shareholders (whether annual or special and whether or not an
adjourned meeting), or, if

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applicable, take action by written consent (i) for adoption and approval of the
Combination Agreement and in favor of the ALC Merger (as defined in the
Combination Agreement) and otherwise in favor of the Combination and any other
transaction contemplated by the Combination Agreement as such Combination
Agreement may be modified or amended from time to time and (ii) against any
action, omission or agreement which would or could impede or interfere with, or
have the effect of discouraging, the Combination, including, without limitation,
any Acquisition Proposal (as defined in the Combination Agreement) other than
the Combination.  Any such vote shall be cast or consent shall be given in
accordance with such procedures relating thereto as shall ensure that it is duly
counted for purposes of determining that a quorum is present and for purposes of
recording the results of such vote or consent.

          (b)  At the request of TI, the Shareholder, in furtherance of the
transactions contemplated hereby and by the Combination Agreement, and in order
to secure the performance by the Shareholder of his or her duties under this
Agreement, shall promptly execute, in accordance with the provisions of Section
1759(d) of the Pennsylvania Business Corporation Law, and deliver to TI, an
irrevocable proxy, substantially in the form of Annex A hereto, and irrevocably
appoint TI or its designees, with full power of substitution, his or her
attorney and proxy to vote, or, if applicable, to give consent with respect to,
all of the Shares owned by the Shareholder in respect of any of the matters set
forth in, and in accordance with the provisions of, clauses (i) and (ii) above
of Section 1(a).  The Shareholder acknowledges that the proxy executed and
delivered by him or her shall be coupled with an interest, shall constitute,
among other things, an inducement for TI to enter into the Combination
Agreement, shall be irrevocable and shall not be terminated by operation of law
upon the occurrence of any event, including, without limitation, the death or
incapacity of the Shareholder.  Notwithstanding any provision contained in such
proxy, such proxy shall terminate upon the Expiration Date.


          Section 2.  COVENANTS OF THE SHAREHOLDER.  The Shareholder covenants
and agrees for the benefit of TI that, until the Expiration Date, he will:

          (a)  not sell, transfer, pledge, hypothecate, encumber, assign, tender
     or otherwise dispose of, or enter into any contract, option or other
     arrangement or understanding with respect to the sale, transfer, pledge,
     hypothecation, encumbrance, assignment, tender or other disposition of, any
     of the Shares owned by him or her or any interest therein (provided, that
     the foregoing shall not prevent the Shareholder from transferring the
     Shares to an entity for estate planning purposes, provided that the
     Shareholder retains sole voting rights over the Shares or

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     the estate planning entity executes a joinder agreeing to be bound by the
     terms of this Agreement);

          (b)  other than as expressly contemplated by this Agreement, not grant
     any powers of attorney or proxies or consents in respect of any of the
     Shares owned by him or her, deposit any of the Shares owned by him into a
     voting trust, enter into a voting agreement with respect to any of the
     Shares owned by him or her or otherwise restrict the ability of the holder
     of any of the Shares owned by him or her freely to exercise all voting
     rights with respect thereto;

          (c)  not, in his or her capacity as a shareholder of the Company (it
     being understood that nothing in this Shareholder Agreement shall restrict
     or affect Shareholder in any other capacity, including as a director or
     officer, as applicable, of the Company) and he or she shall direct and use
     his or her best efforts to cause his or her agents and representatives not
     to, initiate, solicit or encourage, directly or indirectly, any inquiries
     or the making or implementation of any Acquisition Proposal or engage in
     any negotiations concerning, or provide any confidential information or
     data to, or have any discussions with, any person relating to an
     Acquisition Proposal, or otherwise facilitate any effort or attempt to make
     or implement an Acquisition Proposal.  The Shareholder shall immediately
     cease and cause to be terminated any existing activities, including
     discussions or negotiations with any parties, conducted heretofore with
     respect to any of the foregoing and will take the necessary steps to inform
     his or her agents and representatives of the obligations undertaken in this
     Section 2(c).  The Shareholder shall notify TI immediately if any such
     inquiries or proposals are received by, any such information is requested
     from, or any such negotiations or discussions are sought to be initiated or
     continued with, him or her; and

          (d)  not take any action whatsoever that, based on advice from TI's or
     the Company's independent auditors would or could prevent the Combination
     from qualifying for "pooling of interests" accounting treatment.


          Section 3.  COVENANTS OF TI.  TI covenants and agrees for the benefit
of the Shareholder that (a) immediately upon execution of this Agreement, TI
shall enter into the Combination Agreement, and (b) until the Expiration Date,
it shall use all reasonable efforts to take, or cause to be taken, all action,
and do, or cause to be done, all things necessary or advisable in order to
consummate and make effective the transactions contemplated by this Agreement
and the Combination Agreement, consistent with the terms and conditions of each
such agreement;

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PROVIDED, HOWEVER, that nothing in this Section 3, Section 12 or any other
provision of this Agreement is intended, nor shall it be construed, to limit or
in any way restrict TI's right or ability to exercise any of its rights under
the Combination Agreement.


          Section 4.  REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDER.  The
Shareholder represents and warrants to TI that:  (a) the execution, delivery and
performance by the Shareholder of this Agreement will not conflict with, require
a consent, waiver or approval under, or result in a breach of or default under,
any of the terms of any contract, commitment or other obligation (written or
oral) to which the Shareholder is bound; (b) this Agreement has been duly
executed and delivered by the Shareholder and constitutes a legal, valid and
binding obligation of the Shareholder, enforceable against the Shareholder in
accordance with its terms; (c) the Shareholder is the sole owner of or has the
sole right to vote the Shares and the Shares represent all shares of Common
Stock which the Shareholder is the sole owner of or has the sole right to vote
at the date hereof, and the Shareholder does not have any right to acquire, nor
is he the "beneficial owner" (as such term is defined in Rule 13d-3 under the
Securities Exchange Act of 1934, as amended) of, any other shares of any class
of capital stock of the Company or any securities convertible into or
exchangeable or exercisable for any shares of any class of capital stock of the
Company (other than shares subject to options or other rights granted by the
Company); (d) the Shareholder has full right, power and authority to execute and
deliver this Agreement and to perform his or her obligations hereunder; and (e)
the Shareholder owns the Shares free and clear of all liens, claims, pledges,
charges, proxies, restrictions, encumbrances, proxies, voting trusts and voting
agreements of any nature whatsoever other than as provided by this Agreement.
The representations and warranties contained herein shall be made as of the date
hereof and as of each day from the date hereof through and including the
Effective Time (as defined in the Combination Agreement).


          Section 5.  ADJUSTMENTS; ADDITIONAL SHARES.  In the event (a) of any
stock dividend, stock split, merger (other than the Combination),
recapitalization, reclassification, combination, exchange of shares or the like
of the capital stock of the Company on, of or affecting the Shares or (b) that
the Shareholder shall become the beneficial owner of any additional shares of
Common Stock or other securities entitling the holder thereof to vote or give
consent with respect to the matters set forth in Section 1, then the terms of
this Agreement shall apply to the shares of capital stock or other instruments
or documents held by the Shareholder immediately following the effectiveness of
the events described in clause (a) or the Shareholder

                                      - 4 -
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becoming the beneficial owner thereof as described in clause (b), as though, in
either case, they were Shares hereunder.


          Section 6.  SPECIFIC PERFORMANCE.  The Shareholder acknowledges that
the agreements contained in this Agreement are an integral part of the
transactions contemplated by the Combination Agreement, and that, without these
agreements, TI would not enter into the Combination Agreement, and acknowledges
that damages would be an inadequate remedy for any breach by him or her of the
provisions of this Agreement.  Accordingly, the Shareholder and TI each agree
that the obligations of the parties hereunder shall be specifically enforceable
and neither party shall take any action to impede the other from seeking to
enforce such right of specific performance.


          Section 7.  NOTICES.  All notices, requests, claims, demands and other
communications hereunder shall be effective upon receipt (or refusal of
receipt), shall be in writing and shall be delivered in person, by telecopy or
telefacsimile, by telegram, by next-day courier service, or by mail (registered
or certified mail, postage prepaid, return receipt requested) to the Shareholder
at the address listed on the signature page hereof, and to TI at 2049 Century
Park East, Los Angeles, California 90067-3101 Attention: Secretary, telecopy
number 310-551-4366, or to such other address or telecopy number as any party
may have furnished to the other in writing in accordance herewith.


          Section 8.  BINDING EFFECT; SURVIVAL.  Upon execution and delivery of
this Agreement by TI, this Agreement shall become effective as to the
Shareholder at the time the Shareholder executes and delivers this Agreement.
This Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective heirs, personal representatives, successors and
assigns.


          Section 9.  GOVERNING LAW.  This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Pennsylvania
applicable to agreements made and to be performed entirely within such
Commonwealth.


          Section 10.  COUNTERPARTS.  This Agreement may be executed in two
counterparts, both of which shall be an original and both of which together
shall constitute one and the same agreement.

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          Section 11.  EFFECT OF HEADINGS.  The Section headings herein are for
convenience of reference only and shall not affect the construction hereof.


          Section 12.  ADDITIONAL AGREEMENTS; FURTHER ASSURANCE.  Subject to the
terms and conditions herein provided, each of the parties hereto agrees to use
all reasonable efforts to take, or cause to be taken, all action and to do, or
cause to be done, all things necessary, proper or advisable to consummate and
make effective the transactions contemplated by this Agreement.  The Shareholder
will provide TI with all documents which may reasonably be requested by TI and
will take reasonable steps to enable TI to obtain all rights and benefits
provided it hereunder.


          Section 13.  AMENDMENT; WAIVER.  No amendment or waiver of any
provision of this Agreement or consent to departure therefrom shall be effective
unless in writing and signed by TI and the Shareholder, in the case of an
amendment, or by the party which is the beneficiary of any such provision, in
the case of a waiver or a consent to depart therefrom.


                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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          IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto all as of the day and year first above written.

                                   Teledyne, Inc.


                                   By ___________________________
                                      Name:
                                      Title:

_______________________
Shareholder


Address:



Number of Shares:

                                      - 7 -
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                                                                         ANNEX A



                                 [Form of Proxy]

                                IRREVOCABLE PROXY



          In order to secure the performance of the duties of the undersigned
pursuant to the Shareholder Agreement, dated as of April 1, 1996 (the
"Shareholder Agreement"), between the undersigned and Teledyne, Inc., a Delaware
corporation, a copy of such agreement being attached hereto and incorporated by
reference herein, the undersigned hereby irrevocably appoint(s) ______________
and ________________, and each of them, the attorneys, agents and proxies, with
full power of substitution in each of them, for the undersigned and in the name,
place and stead of the undersigned, in respect of any of the matters set forth
in clauses (i) and (ii) of Section 1 of the Shareholder Agreement, to vote or,
if applicable, to give written consent, in accordance with the provisions of
said Section 1 and otherwise act (consistent with the terms of the Shareholder
Agreement) with respect to all shares of Common Stock, par value $0.10 per share
(the "Shares"), of Allegheny Ludlum Corporation, a Pennsylvania corporation (the
"Company"), whether now owned or hereafter acquired, which the undersigned is or
may be entitled to vote at any meeting of the Company held after the date
hereof, whether annual or special and whether or not an adjourned meeting, or,
if applicable, to give written consent with respect thereto.  This Proxy is
coupled with an interest, shall be irrevocable and binding on any successor in
interest of the undersigned and shall not be terminated by operation of law upon
the occurrence of any event, including, without limitation, the death or
incapacity of the undersigned.  This Proxy shall operate to revoke any prior
proxy as to the Shares heretofore granted by the undersigned.  This Proxy shall
terminate on September 30, 1996.  This Proxy has been executed in accordance
with Section 1759(d) of the Pennsylvania Business Corporation Law.


Dated:
________   ______________  ____


Dated:
________   ______________  _____


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