<PAGE>


                                                                  CONFORMED COPY






                                    $3,000,000,000

                                       364-DAY

                                   CREDIT AGREEMENT


                                     dated as of


                                   November 1, 1996


                                        among


                            U S WEST Capital Funding, Inc.
                                    U S WEST, Inc.


                               The Banks Listed Herein

                                   Citibank, N.A., 
                                 as Syndication Agent
                                           

                                The Bank of New York,
                                as Documentation Agent
                                           
                                         and

                      Morgan Guaranty Trust Company of New York,
                               as Administrative Agent 



<PAGE>

                                 TABLE OF CONTENTS*

                                                                            Page
                                    ARTICLE 1
                                  Definitions
Section 1.01.  Definitions...................................................1
Section 1.02.  Accounting Terms and Determinations..........................12
Section 1.03.  Types of Borrowings..........................................12

                                   ARTICLE 2
                                  The Credit
Section 2.01.  Commitments to Lend..........................................13
Section 2.02.  Notice of Committed Borrowing................................15
Section 2.03.  Money Market Borrowings......................................15
Section 2.04.  Notice to Banks; Funding of Loans............................19
Section 2.05.  Notes........................................................20
Section 2.06.  Maturity of Loans............................................21
Section 2.07.  Interest Rates...............................................21
Section 2.08.  Facility Fees................................................24
Section 2.09.  Optional Termination or Reduction of Commitments.............24
Section 2.10.  Method of Electing Interest Rates............................24
Section 2.11.  Optional Prepayments.........................................25
Section 2.12.  General Provisions as to Payments............................26
Section 2.13.  Funding Losses...............................................27
Section 2.14.  Computation of Interest and Fees.............................27
Section 2.15.  Change of Control............................................27

                                  ARTICLE 3
                                 Conditions
Section 3.01.  Closing......................................................28
Section 3.02.  Borrowings...................................................29

                                  ARTICLE 4
                       Representations and Warranties
Section 4.01.  Corporate Existence and Power................................30
Section 4.02.  Corporate and Governmental Authorization;

__________
* The Table of Contents is not part of this Agreement.

                                     i


<PAGE>


               No Contravention.............................................30
Section 4.03.  Binding Effect...............................................30
Section 4.04.  Financial Information........................................30
Section 4.05.  Litigation...................................................31
Section 4.06.  Compliance with ERISA........................................31
Section 4.07.  Environmental Matters........................................32
Section 4.08.  Taxes........................................................32
Section 4.09.  Subsidiaries.................................................32
Section 4.10.  Not an Investment Company....................................33
Section 4.11.  Full Disclosure..............................................33

                                  ARTICLE 5
                                  Covenants
Section 5.01.  Information..................................................33
Section 5.02.  Maintenance of Property; Insurance...........................35
Section 5.03.  Maintenance of Existence.....................................36
Section 5.04.  Compliance with Laws.........................................36
Section 5.05.  Inspection of Property, Books and Records....................36
Section 5.06.  Subsidiary Debt..............................................36
Section 5.07.  Debt Coverage................................................36
Section 5.08.  Negative Pledge..............................................37
Section 5.09.  Consolidations, Mergers and Sales of Assets..................38
Section 5.10.  Use of Proceeds..............................................38

                                  ARTICLE 6
                                  Defaults
Section 6.01.  Events of Default............................................38
Section 6.02.  Notice of Default............................................41

                                 ARTICLE 7
                                 The Agent
Section 7.01.  Appointment and Authorization................................41
Section 7.02.  Agent and Affiliates.........................................41
Section 7.03.  Action by Agent..............................................42
Section 7.04.  Consultation with Experts....................................42
Section 7.05.  Liability of Agent...........................................42
Section 7.06.  Indemnification..............................................42
Section 7.07.  Credit Decision..............................................42
Section 7.08.  Successor Agent..............................................43
Section 7.09.  Agent's Fee..................................................43

                                     ii


<PAGE>

Section 7.10.  Other Agents.................................................43

                                  ARTICLE 8
                           Changes in Circumstances
Section 8.01.  Basis for Determining Interest Rate Inadequate
               or Unfair....................................................43
Section 8.02.  Illegality...................................................44
Section 8.03.  Increased Cost and Reduced Return............................45
Section 8.04.  Taxes........................................................46
Section 8.05.  Domestic Loans Substituted for Affected
               Euro-Dollar Loans............................................48
Section 8.06.  Substitution of Bank.........................................48

                                 ARTICLE 9
                                 Guaranty
Section 9.01.  The Guaranty.................................................49
Section 9.02.  Guaranty Unconditional.......................................49
Section 9.03.  Discharge Only upon Payment in Full;
               Reinstatement In Certain Circumstances.......................50
Section 9.04.  Waiver by the Company........................................50
Section 9.05.  Subrogation..................................................50
Section 9.06.  Stay of Acceleration.........................................50

                                 ARTICLE 10
                                Miscellaneous
Section 10.01.  Notices.....................................................51
Section 10.02.  No Waivers..................................................51
Section 10.03.  Expenses; Indemnification...................................51
Section 10.04.  Sharing of Set-offs.........................................52
Section 10.05.  Amendments and Waivers......................................53
Section 10.06.   Successors and Assigns.....................................53
Section 10.07.  Termination of Existing Credit Agreements...................55
Section 10.08.  Governing Law; Submission to Jurisdiction...................55
Section 10.09.  Counterparts; Integration; Effectiveness....................55
Section 10.10.  WAIVER OF JURY TRIAL........................................56
Section 10.11.  Confidentiality.............................................56

                                     iii


<PAGE>

Pricing Schedule

Schedule 4.07  -  Environmental Matters

Exhibit A -   Note

Exhibit B -   Money Market Quote Request

Exhibit C -   Invitation for Money Market Quotes

Exhibit D -   Money Market Quote

Exhibit E -   Opinion of Counsel for the Company and the Borrower

Exhibit F -   Opinion of Special Counsel for the Administrative Agent

Exhibit G -   Assignment and Assumption Agreement

Exhibit H -   Extension Agreement



                                     iv


<PAGE>

                               CREDIT AGREEMENT


     AGREEMENT dated as of November 1, 1996 among U S WEST Capital Funding, 
Inc., U S WEST, Inc., the BANKS listed on the signature pages hereof, 
CITIBANK, N.A., as Syndication Agent, THE BANK OF NEW YORK, as Documentation 
Agent, and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Administrative 
Agent.



     The parties hereto agree as follows:

                                 ARTICLE 1
                                Definitions

     Section 1.01. Definitions.

     The following terms, as used herein, have the following meanings: 

     "Absolute Rate Auction" means a solicitation of Money Market Quotes setting
forth Money Market Absolute Rates pursuant to Section 2.03.

     "Acquisition" means the merger of Continental Cablevision, Inc.
("Continental"), with and into the Company or a Wholly-Owned Consolidated
Subsidiary, provided that the cash consideration payable to shareholders of
Continental in connection with such merger shall not exceed the "Cash
Consideration Amount" (as defined in the Agreement and Plan of Merger among the
Company, Continental Merger Corporation and Continental dated as of February 27,
1996 and amended and restated as of June 27, 1996 and further amended as of
October 7, 1996) without the consent of the Required Banks, which consent shall
not be unreasonably withheld or delayed.

     "Adjusted London Interbank Offered Rate" has the meaning set forth in
Section 2.07(b).

     "Administrative Questionnaire" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Agent and submitted to
the Agent (with a copy to the Company) duly completed by such Bank.

     "Agent" means Morgan Guaranty Trust Company of New York in its capacity 
as administrative agent for the Banks hereunder, and its successors in such 
capacity.

"Applicable Lending Office" means, with respect to any Bank, (i) in the case 
of its Domestic Loans, its Domestic Lending Office, (ii) in the case of its 
Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case of 
its Money Market Loans, its Money Market Lending Office.

"Assignee" has the meaning set forth in Section 10.06(c).

"Bank" means each bank listed on the signature pages hereof, each Assignee 
which becomes a Bank pursuant to Section 10.06(c), and their respective 
successors.

"Base Rate" means, for any day, a rate per annum equal to the higher of (i) 
the Prime Rate for such day and  (ii) the sum of 1/2 of 1% plus the Federal 
Funds Rate for such day.

 "Benefit Arrangement" means at any time an employee benefit plan within the 
meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan 
and which is maintained or otherwise contributed to by any member of the 
ERISA Group.

"Borrower" means U S WEST Capital Funding, Inc., a Colorado corporation, and 
its successors.

"Borrowing" has the meaning set forth in Section 1.03.

"Closing Date" means the date on or after the Effective Date on which the 
Agent shall have received the documents specified in or pursuant to Section 
3.01.

"Commitment" means, with respect to each Bank, the amount set forth opposite 
the name of such Bank on the signature pages hereof, as such amount may be 
reduced from time to time pursuant to Sections 2.09 and 2.11.

"Committed Loan" means a loan to be made by a Bank pursuant to Section 
2.01(a); provided that if any such loan or loans are combined or subdivided 
pursuant to a Notice of Interest Rate Election, the term "Committed Loan" 
shall refer to the combined principal amount resulting from such combination 
or to each of the separate principal amounts resulting from such subdivision, 
as the case may be.

"Company" means U S WEST, Inc., a Delaware corporation, and its successors.

                                      2

<PAGE>

"Company's 1995 Form 10-K" means the Company's annual report on Form 10-K for 
1995, as filed with the Securities and Exchange Commission pursuant to the 
Securities Exchange Act of 1934.

"Consolidated Net Worth" means at any date the consolidated shareowners' 
equity of the Company and its Consolidated Subsidiaries determined as of such 
date.

"Consolidated Subsidiary" means at any date any Subsidiary or other entity 
the accounts of which would be consolidated with those of the Company in its 
consolidated financial statements if such statements were prepared as of such 
date.

"Debt" of any Person means at any date, without duplication, (i) all 
obligations of such Person for borrowed money, (ii) all obligations of such 
Person evidenced by bonds, debentures, notes or other similar instruments, 
(iii) all obligations of such Person to pay the deferred purchase price of 
property or services, except trade accounts payable arising in the ordinary 
course of business, (iv) all obligations of such Person as lessee which are 
capitalized in accordance with generally accepted accounting principles, (v) 
all Debt secured by a Lien on any asset of such Person, whether or not such 
Debt is otherwise an obligation of such Person, and (vi) all Debt of others 
Guaranteed by such Person. Notwithstanding the foregoing, for purposes of 
Sections 5.06 and 5.07 Debt shall in no event include the following:

(x) Debt of Persons which are not Consolidated Subsidiaries ("Joint 
Ventures") (i) which is secured by a Lien on the assets or capital stock of a 
Minor Subsidiary or the equity interests in such Joint Ventures or is 
Guaranteed by a Minor Subsidiary, which Lien or Guarantee is incurred in 
connection with the international operations of the Company and its 
Subsidiaries, and (ii) for the payment of which no other recourse may be had 
to the Company or any of its Subsidiaries; and

(y) Debt of the Company or the Borrower issued in connection with the 
issuance of Trust Originated Preferred Securities or substantially similar 
securities, so long as such Debt is subordinated and junior in right of 
payment to substantially all liabilities of the Company or the Borrower, as 
the case may be, including, without limitation, the Loans.

"Default" means any condition or event which constitutes an Event of Default 
or which with the giving of notice or lapse of time or both would, unless 
cured or waived, become an Event of Default.

                                      3

<PAGE>

"Domestic Business Day" means any day except a Saturday, Sunday or other day 
on which commercial banks in New York City are authorized by law to close.

"Domestic Lending Office" means, as to each Bank, its office located at its 
address set forth in its Administrative Questionnaire (or identified in its 
Administrative Questionnaire as its Domestic Lending Office) or such other 
office as such Bank may hereafter designate as its Domestic Lending Office by 
notice to the Company and the Agent.

"Domestic Loan" means (i) a Committed Loan which bears interest at the Base 
Rate pursuant to the applicable Notice of Committed Borrowing or Notice of 
Interest Rate Election or the provisions of Article 8 or (ii) an overdue 
amount which was a Domestic Loan immediately before it became overdue.

"Effective Date" means the date this Agreement becomes effective in 
accordance with Section 10.09.

"Environmental Laws" means any and all federal, state, local and foreign 
statutes, laws, judicial decisions, regulations, ordinances, rules, 
judgments, orders, decrees, plans, injunctions, permits, concessions, grants, 
franchises, licenses, agreements and other governmental restrictions relating 
to the environment, the effect of the environment on human health or to 
emissions, discharges or releases of pollutants, contaminants, Hazardous 
Substances or wastes into the environment including, without limitation, 
ambient air, surface water, ground water, or land, or otherwise relating to 
the manufacture, processing, distribution, use, treatment, storage, disposal, 
transport or handling of pollutants, contaminants, Hazardous Substances or 
wastes or the clean-up or other remediation thereof.

"ERISA" means the Employee Retirement Income Security Act of 1974, as 
amended, or any successor statute.

"ERISA Group" means the Company, any Subsidiary and all members of a 
controlled group of corporations and all trades or businesses (whether or not 
incorporated) under common control which, together with the Company or any 
Subsidiary, are treated as a single employer under Section 414 of the 
Internal Revenue Code.

"Euro-Dollar Business Day" means any Domestic Business Day on which 
commercial banks are open for international business (including dealings in 
dollar deposits) in London.

                                      4

<PAGE>

"Euro-Dollar Lending Office" means, as to each Bank, its office, branch or 
affiliate located at its address set forth in its Administrative 
Questionnaire (or identified in its Administrative Questionnaire as its 
Euro-Dollar Lending Office) or such other office, branch or affiliate of such 
Bank as it may hereafter designate as its Euro-Dollar Lending Office by 
notice to the Company and the Agent.

"Euro-Dollar Loan" means (i) a Committed Loan which bears interest at a 
Euro-Dollar Rate pursuant to the applicable Notice of Committed Borrowing or 
Notice of Interest Rate Election or (ii) an overdue amount which was a 
Euro-Dollar Loan before it became overdue.

"Euro-Dollar Margin" has the meaning set forth in Section 2.07(b).

"Euro-Dollar Rate" means a rate of interest determined pursuant to Section 
2.07(b) on the basis of an Adjusted London Interbank Offered Rate.

"Euro-Dollar Reference Banks" means the principal London offices of Citibank, 
N.A., The Bank of New York and Morgan Guaranty Trust Company of New York, and 
"Euro-Dollar Reference Bank" means any one of the foregoing.

"Euro-Dollar Reserve Percentage" has the meaning set forth in Section 2.07(b).

"Event of Default" has the meaning set forth in Section 6.01.

"Existing Credit Agreements" means the Credit Agreements dated as of August 
8, 1994, as amended,  among the Borrower, the Company, the banks listed on 
the signature pages thereof and Morgan Guaranty Trust Company of New York, as 
Agent.

"Federal Funds Rate" means, for any day, the rate per annum (rounded upward, 
if necessary, to the nearest 1/100th of 1%) equal to the weighted average of 
the rates on overnight Federal funds transactions with members of the Federal 
Reserve System arranged by Federal funds brokers on such day, as published by 
the Federal Reserve Bank of New York on the Domestic Business Day next 
succeeding such day, provided that (i) if such day is not a Domestic Business 
Day, the Federal Funds Rate for such day shall be such rate on such 
transactions on the next preceding Domestic Business Day as so published on 
the next succeeding Domestic Business Day, and (ii) if no such rate is so 
published on such next succeeding Domestic Business Day, the Federal Funds 
Rate for such day shall be the average rate quoted to Morgan Guaranty Trust 
Company of New York on such day on such transactions as determined by the 
Agent.

                                      5

<PAGE>

"Fixed Rate Loans" means Euro-Dollar Loans or Money Market Loans (excluding 
Money Market LIBOR Loans bearing interest at the Base Rate pursuant to 
Section 8.01(a)) or any combination of the foregoing.

"Group of Loans" means at any time a group of Loans consisting of (i) all 
Committed Loans which are Domestic Loans at such time or (ii) all Committed 
Loans which are Euro-Dollar Loans having the same Interest Period at such 
time; provided that, if a Committed Loan of any particular Bank is converted 
to or made as a Domestic Loan pursuant to Section 8.02 or 8.05, such Loan 
shall be included in the same Group or Groups of Loans from time to time as 
it would have been in if it had not been so converted or made.

"Guarantee" by any Person means any obligation, contingent or otherwise, of 
such Person directly or indirectly guaranteeing any Debt or other obligation 
of any other Person and, without limiting the generality of the foregoing, 
any obligation, direct or indirect, contingent or otherwise, of such Person 
(i) to purchase or pay (or advance or supply funds for the purchase or 
payment of) such Debt or other obligation (whether arising by virtue of 
partnership arrangements, by agreement to keep-well, to purchase assets, 
goods, securities or services, to take-or-pay, or to maintain financial 
statement conditions or otherwise) or (ii) entered into for the purpose of 
assuring in any other manner the obligee of such Debt or other obligation of 
the payment thereof or to protect such obligee against loss in respect 
thereof (in whole or in part), provided that the term Guarantee shall not 
include endorsements for collection or deposit in the ordinary course of 
business.  The term "Guarantee" used as a verb has a corresponding meaning.

"Hazardous Substances" means any toxic, radioactive, caustic or otherwise 
hazardous substance, including petroleum, its derivatives, by-products and 
other hydrocarbons, or any substance having any constituent elements 
displaying any of the foregoing characteristics.

"Indemnitee" has the meaning set forth in Section 10.03(b).

"Indentures" means the agreements or instruments evidencing the following 
Debt of Continental Cablevision, Inc., and its successors: (i) the 10 5/8% 
Senior Subordinated Notes Due June 15, 2002; (ii) the 11% Senior Subordinated 
Debentures Due June 1, 2007; (iii) the 8 5/8% Senior Notes Due August 15, 
2003; (iv) the 9% Senior Debentures Due September 1, 2008; (v) the 8 7/8% 
Senior Debentures Due September 15, 2002; (vi) the 9 1/2% Senior Debentures 
Due August 1, 2013; (vii) the 8 1/2% Senior Notes Due September 15, 2001; and 
(viii) any other Debt containing terms and conditions as or more

                                      6

<PAGE>

favorable to the holders thereof than the terms and conditions of any of the 
foregoing Debt.

"Interest Period" means:  (1) with respect to each Euro-Dollar Loan, a period 
commencing on the date of borrowing specified in the applicable Notice of 
Borrowing or the date specified in the applicable Notice of Interest Rate 
Election and ending one, two, three or six months thereafter, as the Borrower 
may elect in the applicable notice; provided that:

      (a)  any Interest Period which would otherwise end on a day which is 
not a Euro-Dollar Business Day shall be extended to the next succeeding 
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in 
another calendar month, in which case such Interest Period shall end on the 
next preceding Euro-Dollar Business Day;

      (b)  any Interest Period which begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) below, end on the last Euro-Dollar Business Day of
a calendar month; and

      (c) any Interest Period beginning prior to a Termination Date which would
otherwise end after a Termination Date shall end on such Termination Date, and 
any Interest Period beginning on or after a Termination Date which would
otherwise end after the first anniversary of such Termination Date shall end on
the first anniversary of such Termination Date.

(2)  with respect to each Money Market LIBOR Loan, the period commencing on 
the date of borrowing specified in the applicable Notice of Borrowing and 
ending such whole number of months thereafter as the Borrower may elect in 
accordance with Section 2.03; provided that:

       (a)  any Interest Period which would otherwise end on a day which is 
not a Euro-Dollar Business Day shall be extended to the next succeeding 
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in 
another calendar month, in which case such Interest Period shall end on the 
next preceding Euro-Dollar Business Day;

       (b) any Interest Period which begins on the last Euro-Dollar Business 
Day of a calendar month (or on a day for which there is no numerically 
corresponding day in the calendar month at the end of such

                                      7

<PAGE>

Interest Period) shall, subject to clause (c) below, end on the last 
Euro-Dollar Business Day of a calendar month; and

        (c)  any Interest Period beginning prior to a Termination Date which 
would otherwise end after a Termination Date shall end on such Termination 
Date.

(3)  with respect to each Money Market Absolute Rate Loan, 
the period commencing on the date of borrowing specified in the applicable 
Notice of Borrowing and ending such number of days thereafter (but not less 
than 7 days) as the Borrower may elect in accordance with Section 2.03; 
provided that:

        (a)  any Interest Period which would otherwise end on a day which is 
not a Euro-Dollar Business Day shall be extended to the next succeeding 
Euro-Dollar Business Day; and

        (b)  any Interest Period beginning prior to a Termination Date which 
would otherwise end after a Termination Date shall end on such Termination 
Date.

"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended, 
or any successor statute.

"LIBOR Auction" means a solicitation of Money Market Quotes setting forth 
Money Market Margins based on the London Interbank Offered Rate pursuant to 
Section 2.03.

"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, 
security interest or encumbrance of any kind, or any other type of 
preferential arrangement that has the practical effect of creating a security 
interest, in respect of such asset.  For the purposes of this Agreement, the 
Company or any Subsidiary shall be deemed to own subject to a Lien any asset 
which it has acquired or holds subject to the interest of a vendor or lessor 
under any conditional sale agreement, capital lease or other title retention 
agreement relating to such asset.

"Loan" means a Domestic Loan or a Euro-Dollar Loan or a Money Market Loan and 
"Loans" means Domestic Loans or Euro-Dollar Loans or Money Market Loans or 
any combination of the foregoing.

"London Interbank Offered Rate" has the meaning set forth in Section 2.07(b).

                                      8

<PAGE>

"Margin Stock" means "margin stock" as such term is defined in Regulation U 
of the Board of Governors of the Federal Reserve System, as in effect from 
time to time.

"Material Debt" means Debt (other than the Notes) of the Company and/or one 
or more of its Subsidiaries, arising in one or more related or unrelated 
transactions, in an aggregate principal amount exceeding $100,000,000.

"Material Plan" means at any time a Plan or Plans having aggregate Unfunded 
Liabilities in excess of $100,000,000.

"Minor Subsidiary" means, for purposes of the last sentence of the definition 
of Debt and of Section 5.08(f) (the "Relevant Provisions"), (i) USW PCN Inc., 
and (ii) any other Subsidiary which, at the time of the issuance of a 
Guarantee or grant of a Lien referred to in the Relevant Provisions, had 
assets which, when taken together with all assets of Subsidiaries at any 
earlier time when such Subsidiaries were deemed to be Minor Subsidiaries 
pursuant to this clause (ii), did not exceed $250,000,000.

"Money Market Absolute Rate" has the meaning set forth in Section 2.03(d).

"Money Market Absolute Rate Loan" means a loan to be made by a Bank pursuant 
to an Absolute Rate Auction.

"Money Market Lending Office" means, as to each Bank, its Domestic Lending 
Office or such other office, branch or affiliate of such Bank as it may 
hereafter designate as its Money Market Lending Office by notice to the 
Company and the Agent; provided that any Bank may from time to time by notice 
to the Company and the Agent designate separate Money Market Lending Offices 
for its Money Market LIBOR Loans, on the one hand, and its Money Market 
Absolute Rate Loans, on the other hand, in which case all references herein 
to the Money Market Lending Office of such Bank shall be deemed to refer to 
either or both of such offices, as the context may require.

"Money Market LIBOR Loan" means a loan to be made by a Bank pursuant to a 
LIBOR Auction (including such a loan bearing interest at the Base Rate 
pursuant to Section 8.01(a)).

"Money Market Loan" means a Money Market LIBOR Loan or a Money Market 
Absolute Rate Loan.

                                      9

<PAGE>

"Money Market Margin" has the meaning set forth in Section 2.03(d).

"Money Market Quote" means an offer by a Bank to make a Money Market Loan in 
accordance with Section 2.03.

"Multiemployer Plan" means at any time an employee pension benefit plan 
within the meaning of Section 4001(a)(3) of ERISA to which any member of the 
ERISA Group is then making or accruing an obligation to make contributions or 
has within the preceding five plan years made contributions, including for 
these purposes any Person which ceased to be a member of the ERISA Group 
during such five year period.

"Notes" means promissory notes of the  Borrower, substantially in the form of 
Exhibit A hereto, evidencing the obligation of the Borrower to repay the 
Loans made to it, and "Note" means any one of such promissory notes issued 
hereunder.

"Notice of Borrowing" means a Notice of Committed Borrowing (as defined in 
Section 2.02) or a Notice of Money Market Borrowing (as defined in Section 
2.03(f)).

"Parent" means, with respect to any Bank, any Person controlling such Bank.

"Participant" has the meaning set forth in Section 10.06(b).

"PBGC" means the Pension Benefit Guaranty Corporation or any entity 
succeeding to any or all of its functions under ERISA.

 "Person" means an individual, a corporation, a partnership, an association, 
a trust or any other entity or organization, including a government or 
political subdivision or an agency or instrumentality thereof.

"Plan" means at any time an employee pension benefit plan (other than a 
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the 
minimum funding standards under Section 412 of the Internal Revenue Code and 
either (i) is maintained, or contributed to, by any member of the ERISA Group 
for employees of any member of the ERISA Group or (ii) has at any time within 
the preceding five years been maintained, or contributed to, by any Person 
which was at such time a member of the ERISA Group for employees of any 
Person which was at such time a member of the ERISA Group.

                                     10

<PAGE>

"Pricing Schedule" means the Schedule attached hereto and identified as such.

"Prime Rate" means the rate of interest publicly announced by Morgan Guaranty 
Trust Company of New York in New York City from time to time as its Prime 
Rate.

"Required Banks" means at any time Banks having more than 50% of the 
aggregate amount of the Commitments or, if the Commitments shall have been 
terminated, holding Notes evidencing more than 50% of the aggregate unpaid 
principal amount of the Loans.

"Revolving Credit Period" means the period from and including the Effective 
Date to but excluding the Termination Date.

"Significant Subsidiary" means any Subsidiary which would meet the definition 
of "significant subsidiary" contained as of the date hereof in Regulation S-X 
of the Securities and Exchange Commission.

"Subsidiary" means any corporation or other entity of which securities or 
other ownership interests having ordinary voting power to elect a majority of 
the board of directors or other persons performing similar functions are at 
the time directly or indirectly owned by the Company.

"Super-Majority Banks" means at any time Banks having at least 85% of the 
aggregate amount of the Commitments or, if the Commitments shall have been 
terminated, holding Notes evidencing at least 85% of the aggregate unpaid 
principal amount of the Loans.

"Termination Date" means with respect to each Bank October 31, 1997, or such 
later date to which the Termination Date for such Bank shall have been 
extended pursuant to Section 2.01(b), or, if such day is not a Euro-Dollar 
Business Day, the next preceding Euro-Dollar Business Day.

"Unfunded Liabilities" means, with respect to any Plan at any time, the 
amount (if any) by which (i) the value of all benefit liabilities under such 
Plan, determined on a plan termination basis using the assumptions prescribed 
by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair 
market value of all Plan assets allocable to such liabilities under Title IV 
of ERISA (excluding any accrued but unpaid contributions), all determined as 
of the then most recent valuation date for such Plan, but only to the extent 
that such excess represents a

                                     11

<PAGE>

potential liability of a member of the ERISA Group to the PBGC or any other 
Person under Title IV of ERISA.

"United States" means the United States of America, including the States and 
the District of Columbia, but excluding its territories and possessions.

"Wholly-Owned Consolidated Subsidiary" means any Consolidated Subsidiary all 
of the shares of capital stock or other ownership interests of which (except 
directors' qualifying shares) are at the time directly or indirectly owned by 
the Company.

     Section 1.02. Accounting Terms and Determinations. Unless otherwise 
specified herein, all accounting terms used herein shall be interpreted, all 
accounting determinations hereunder shall be made, and all financial 
statements required to be delivered hereunder shall be prepared in accordance 
with generally accepted accounting principles as in effect from time to time 
in the United States, applied on a basis consistent (except for changes 
concurred in by the Company's independent public accountants) with the most 
recent audited consolidated financial statements of the Company and its 
Consolidated Subsidiaries delivered to the Banks; provided that, if the 
Company notifies the Agent that the Company wishes to amend any covenant in 
Article 5 to eliminate the effect of any change in such generally accepted 
accounting principles on the operation of such covenant (or if the Agent 
notifies the Company that the Required Banks wish to amend Article 5 for such 
purpose), then compliance with such covenant shall be determined on the basis 
of generally accepted accounting principles in effect in the United States 
immediately before the relevant change in generally accepted accounting 
principles became effective, until either such notice is withdrawn or such 
covenant is amended in a manner satisfactory to the Company and the Required 
Banks.

     Section 1.03. Types of Borrowings. The term "Borrowing" denotes the 
aggregation of Loans of one or more Banks to be made to the Borrower pursuant 
to Article 2 on a single date, all of which Loans are of the same type 
(subject to Article 8) and, except in the case of Domestic Loans, have the 
same Interest Period or initial Interest Period.  Borrowings are classified 
for purposes of this Agreement either by reference to the pricing of Loans 
comprising such Borrowing (e.g., a "Euro-Dollar Borrowing" is a Borrowing 
comprised of Euro-Dollar Loans) or by reference to the provisions of Article 
2 under which participation therein is determined (i.e., a "Committed 
Borrowing" is a Borrowing under Section 2.01(a) in which all Banks 
participate in proportion to their Commitments, while a "Money Market 
Borrowing" is a Borrowing under Section

                                     12

<PAGE>

2.03 in which the Bank participants are determined on the basis of their bids 
in accordance therewith).

                                   ARTICLE 2
                                  The Credit

     Section 2.01.  Commitments to Lend.

(a) The Commitments.  During the Revolving Credit Period each Bank severally 
agrees, on the terms and conditions set forth in this Agreement, to make 
loans to the Borrower pursuant to this subsection (a) from time to time in 
amounts such that the aggregate principal amount of Committed Loans by such 
Bank at any one time outstanding to the Borrower shall not exceed the amount 
of its Commitment.  Each Borrowing under this Section shall be in an 
aggregate principal amount of $25,000,000 or any larger multiple of 
$5,000,000 (except that any such Borrowing may be in the aggregate amount 
available in accordance with Section 3.02(c)) and shall be made from the 
several Banks ratably in proportion to their respective Commitments.  Within 
the foregoing limits, the Borrower may borrow under this subsection (a), 
repay, or to the extent permitted by Section 2.11, prepay Loans and reborrow 
at any time during the Revolving Credit Period under this subsection (a).  
The Commitments shall terminate at the close of business on the Termination 
Date.

(b) Extension of Commitments.  The Commitments may be extended in the manner 
and amount set forth in this subsection (b), for a period of 364 days 
measured from the Termination Date then in effect.  If the Company wishes to 
request an extension of each Bank's Commitment, it shall give notice to that 
effect to the Agent not less than 45 days and not more than 60 days prior to 
the Termination Date then in effect, whereupon the Agent shall promptly 
notify each of the Banks of such request.  Each Bank will use its best 
efforts to respond to such request, whether affirmatively or negatively, as 
it may elect in its discretion, within 30 days of such notice to the Agent.  
If any Bank shall not have responded affirmatively within such 30-day period, 
such Bank shall be deemed to have rejected the Company's proposal to extend 
its Commitment, and only the Commitments of those Banks which have responded 
affirmatively shall be extended, subject to receipt by the Agent of 
counterparts of an Extension Agreement in substantially the form of Exhibit H 
hereto duly completed and signed by the Borrower, the Company, the Agent and 
all of the Banks which have responded affirmatively.  The Agent shall provide 
to the Company, no later than 10 days prior to the Termination Date then in 
effect, a list of the Banks which

                                     13

<PAGE>

have responded affirmatively.  The Extension Agreement shall be executed and 
delivered no later than five days prior to the Termination Date then in 
effect, and no extension of the Commitments pursuant to this subsection (b) 
shall be legally binding on any party hereto unless and until such Extension 
Agreement is so executed and delivered. The Company and the Borrower may 
decline to execute and deliver such Extension Agreement if any Bank has 
rejected the Company's proposal to extend its Commitment or has failed to 
execute and deliver such Extension Agreement, and will promptly notify the 
Agent and the Banks if it so declines.

     (c) Additional Commitments.  At any time during the Revolving Credit 
Period, if no Default shall have occurred and be continuing at such time, the 
Company may, if it so elects, increase the aggregate amount of the 
Commitments, either by designating a Person not theretofore a Bank and 
acceptable to the Agent to become a Bank or by agreeing with an existing Bank 
that such Bank's Commitment shall be increased.  Upon execution and delivery 
by the Company, the Borrower and such Bank or other Person of an instrument 
of assumption in form and amount satisfactory to the Administrative Agent, 
such existing Bank shall have a Commitment as therein set forth or such other 
Person shall become a Bank with a Commitment as therein set forth and all the 
rights and obligations of a Bank with such a Commitment hereunder; provided 
that (i) the Company shall provide prompt notice of such increase to the 
Agent, which shall promptly notify the other Banks, (ii) the aggregate amount 
of each such increase which is effective on any day shall be at least 
$50,000,000 and (iii) the aggregate amount of the Commitments shall at no 
time exceed $4,200,000,000.  Upon any increase in the aggregate amount of the 
Commitments pursuant to this subsection (c), within five Domestic Business 
Days in the case of each Group of Domestic Loans outstanding, and at the end 
of the then current Interest Period with respect thereto in the case of each 
Group of Euro-Dollar Loans then outstanding, the Borrower shall prepay such 
Group in its entirety, and, to the extent the Borrower elects to do so and 
subject to the conditions specified in Article 3, the Borrower shall reborrow 
Committed Loans from the Banks in proportion to their respective Commitments 
after giving effect to such increase, until such time as all outstanding 
Committed Loans are held by the Banks in such proportion.

     (d)   Term Loans.  Each Bank severally agrees, on the terms and 
conditions set forth in this Agreement, to make a loan to the Borrower on the 
Termination Date in amounts such that the aggregate principal amount of such 
Bank's outstanding Loans to the Borrower at the close of business on the 
Termination Date shall not exceed its Commitment.  Each Borrowing under this 
subsection (d) shall be made from the several Banks ratably in proportion to 
their respective Commitments.  Amounts prepaid pursuant to Section 2.11 shall 
not be

                                     14

<PAGE>

reborrowed.  If less than all the Banks shall have agreed to extend the 
Termination Date pursuant to subsection (b) above, but the Termination Date 
for those Banks which have not so agreed has not yet occurred (the "Earlier 
Date"), and the Borrower has requested a Borrowing pursuant to this 
subsection (d), then such Borrowing shall be made on the Earlier Date.

     Section 2.02. Notice of Committed Borrowing. The Borrower shall give the 
Agent notice (a "Notice of Committed Borrowing") not later than 10:30 A.M. 
(New York City time) on (x) the date of each Domestic Borrowing, and (y) the 
third Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:

     (i)  the date of such Borrowing, which shall be a Domestic Business Day 
in the case of a Domestic Borrowing or a Euro-Dollar Business Day in the case 
of a Euro-Dollar Borrowing,

     (ii)  the aggregate amount of such Borrowing,

     (iii)  whether the Loans comprising such Borrowing bear interest 
initially at the Base Rate or at a Euro-Dollar Rate, and

     (iv)  in the case of a Euro-Dollar Borrowing, the duration of the 
initial Interest Period applicable thereto, subject to the provisions of the 
definition of Interest Period.

     Section 2.03. Money Market Borrowings. (a)  The Money Market Option.  In 
addition to Committed Borrowings pursuant to Section 2.01(a), the Borrower 
may, as set forth in this Section, request the Banks during the Revolving 
Credit Period to make offers to make Money Market Loans to the Borrower.  The 
Banks may, but shall have no obligation to, make such offers and the Borrower 
may, but shall have no obligation to, accept any such offers in the manner 
set forth in this Section.

     (b) Money Market Quote Request.  When the Borrower wishes to request 
offers to make Money Market Loans under this Section, it shall transmit to 
the Agent by telex or facsimile transmission a Money Market Quote Request 
substantially in the form of Exhibit B hereto so as to be received no later 
than 9:00 A.M. (New York City time) on (x) the fourth Euro-Dollar Business 
Day prior to the date of Borrowing proposed therein, in the case of a LIBOR 
Auction or (y) the Domestic Business Day prior to the date of Borrowing 
proposed therein, in the case of an Absolute Rate Auction (or, in either 
case, such other time or date as the Company and the Agent shall have 
mutually agreed and shall have notified to the Banks not later than the date 
of the Money Market Quote Request for the

                                     15

<PAGE>

first LIBOR Auction or Absolute Rate Auction for which such change is to be 
effective) specifying:

     (i)  the proposed date of Borrowing, which shall be a Euro-Dollar 
Business Day in the case of a LIBOR Auction or a Domestic Business Day in the 
case of an Absolute Rate Auction,

     (ii)  the aggregate amount of such Borrowing, which shall be $25,000,000 
or a larger multiple of $5,000,000,

     (iii)  the duration of the Interest Period applicable thereto, subject 
to the provisions of the definition of Interest Period, and

     (iv)  whether the Money Market Quotes requested are to set forth a Money 
Market Margin or a Money Market Absolute Rate.

The Borrower may request offers to make Money Market Loans for more than one 
Interest Period in a single Money Market Quote Request.  No Money Market 
Quote Request shall be given within five Euro-Dollar Business Days (or such 
other number of days as the Company and the Agent may agree) of any other 
Money Market Quote Request.

     (c) Invitation for Money Market Quotes.  Promptly upon receipt of a 
Money Market Quote Request, the Agent shall send to the Banks by telex or 
facsimile transmission an Invitation for Money Market Quotes substantially in 
the form of Exhibit C hereto, which shall constitute an invitation by the 
Borrower to each Bank to submit Money Market Quotes offering to make the 
Money Market Loans to which such Money Market Quote Request relates in 
accordance with this Section.

     (d) Submission and Contents of Money Market Quotes.   (i)  Each Bank may 
submit a Money Market Quote containing an offer or offers to make Money 
Market Loans in response to any Invitation for Money Market Quotes.  Each 
Money Market Quote must comply with the requirements of this subsection (d) 
and must be submitted to the Agent by telex or facsimile transmission at its 
offices specified in or pursuant to Section 10.01 not later than (x) 10:30 
A.M. (New York City time) on the third Euro-Dollar Business Day prior to the 
proposed date of Borrowing, in the case of a LIBOR Auction or (y) 9:15 A.M. 
(New York City time) on the proposed date of Borrowing, in the case of an 
Absolute Rate Auction (or, in either case, such other time or date as the 
Company and the Agent shall have mutually agreed and shall have notified to 
the Banks not later than the date of the Money Market Quote Request for the 
first LIBOR

                                     16

<PAGE>

Auction or Absolute Rate Auction for which such change is to be effective); 
provided that Money Market Quotes submitted by the Agent (or any affiliate of 
the Agent) in the capacity of a Bank may be submitted, and may only be 
submitted, if the Agent or such affiliate notifies the Borrower of the terms 
of the offer or offers contained therein not later than (x) one hour prior to 
the deadline for the other Banks, in the case of a LIBOR Auction or (y) 15 
minutes prior to the deadline for the other Banks, in the case of an Absolute 
Rate Auction.  Subject to Articles 3 and 6, any Money Market Quote so made 
shall be irrevocable except with the written consent of the Agent given on 
the instructions of the Borrower.

     (ii) Each Money Market Quote shall be in substantially the form of 
Exhibit D hereto and shall in any case specify:

     (A)  the proposed date of Borrowing,

     (B)  the principal amount of the Money Market Loan for which each such 
offer is being made, which principal amount (w) may be greater than or less 
than the Commitment of the quoting Bank, (x) must be $5,000,000 or a larger 
multiple of $1,000,000, (y) may not exceed the principal amount of Money 
Market Loans for which offers were requested, and (z) may be subject to an 
aggregate limitation as to the principal amount of Money Market Loans for 
which offers being made by such quoting Bank may be accepted,

     (C)  in the case of a LIBOR Auction, the margin above or below the 
applicable London Interbank Offered Rate (the "Money Market Margin") offered 
for each such Money Market Loan, expressed as a percentage (specified to the 
nearest 1/10,000th of 1%) to be added to or subtracted from such base rate,

     (D)  in the case of an Absolute Rate Auction, the rate of interest per 
annum (specified to the nearest 1/10,000th of 1%) (the "Money Market Absolute 
Rate") offered for each such Money Market Loan, and

     (E)  the identity of the quoting Bank.

A Money Market Quote may set forth up to five separate offers by the quoting 
Bank with respect to each Interest Period specified in the related Invitation 
for Money Market Quotes.

     (iii)     Any Money Market Quote shall be disregarded if it:

                                     17

<PAGE>

     (A)  is not substantially in conformity with Exhibit D hereto or does 
not specify all of the information required by subsection (d)(ii);

     (B) contains qualifying, conditional or similar language; 

     (C)  proposes terms other than or in addition to those set forth in the 
applicable Invitation for Money Market Quotes; or

     (D) arrives after the time set forth in subsection (d)(i).

     (e) Notice to Borrower.  The Agent shall promptly (and in any event no 
later than 11:00 A.M. (New York time) on (i) the third Euro-Dollar Business 
Day prior to the proposed date of Borrowing, in the case of a LIBOR Auction 
or (ii) the proposed date of Borrowing, in the case of an Absolute Rate 
Auction) notify the Borrower of the terms (x) of any Money Market Quote 
submitted by a Bank that is in accordance with subsection (d) and (y) of any 
Money Market Quote that amends, modifies or is otherwise inconsistent with a 
previous Money Market Quote submitted by such Bank with respect to the same 
Money Market Quote Request.  Any such subsequent Money Market Quote shall be 
disregarded by the Agent unless such subsequent Money Market Quote is 
submitted solely to correct a manifest error in such former Money Market 
Quote.  The Agent's notice to the Borrower shall specify (A) the aggregate 
principal amount of Money Market Loans for which offers have been received 
for each Interest Period specified in the related Money Market Quote Request, 
(B) the respective principal amounts and Money Market Margins or Money Market 
Absolute Rates, as the case may be, so offered and (C) if applicable, 
limitations on the aggregate principal amount of Money Market Loans for which 
offers in any single Money Market Quote may be accepted.

     (f) Acceptance and Notice by Borrower.  Not later than 11:15 A.M. (New 
York City time) on (x) the third Euro-Dollar Business Day prior to the 
proposed date of Borrowing, in the case of a LIBOR Auction or (y) the 
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in 
either case, such other time or date as the Company and the Agent shall have 
mutually agreed and shall have notified to the Banks not later than the date 
of the Money Market Quote Request for the first LIBOR Auction or Absolute 
Rate Auction for which such change is to be effective), the Borrower shall 
notify the Agent of its acceptance or non-acceptance of the offers so 
notified to it pursuant to subsection (e).  In the case of acceptance, such 
notice (a "Notice of Money Market

                                     18

<PAGE>

Borrowing") shall specify the aggregate principal amount of offers for each 
Interest Period that are accepted.  The Borrower may accept any Money Market 
Quote in whole or in part; provided that:

     (i) the aggregate principal amount of each Money Market Borrowing may 
not exceed the applicable amount set forth in the related Money Market Quote 
Request,

     (ii)  the principal amount of each Money Market Borrowing must be 
$25,000,000 or a larger multiple of $5,000,000,

     (iii) acceptance of offers may only be made on the basis of ascending 
Money Market Margins or Money Market Absolute Rates, as the case may be, and

     (iv) the Borrower may not accept any offer that is described in 
subsection (d)(iii) or that otherwise fails to comply with the requirements 
of this Agreement.

     (g) Allocation by Agent.  If offers are made by two or more Banks with 
the same Money Market Margins or Money Market Absolute Rates, as the case may 
be, for a greater aggregate principal amount than the amount in respect of 
which such offers are accepted for the related Interest Period, the principal 
amount of Money Market Loans in respect of which such offers are accepted 
shall be allocated by the Agent among such Banks as nearly as possible (in 
multiples of $1,000,000, as the Agent may deem appropriate) in proportion to 
the aggregate principal amounts of such offers. Determinations by the Agent 
of the amounts of Money Market Loans shall be conclusive in the absence of 
manifest error.

     Section 2.04. Notice to Banks; Funding of Loans. (a) Upon receipt of a 
Notice of Borrowing, the Agent shall promptly notify each Bank of the 
contents thereof and of such Bank's share (if any) of such Borrowing and such 
Notice of Borrowing shall not thereafter be revocable by the Borrower.

     (b)  Not later than 1:00 P.M. (New York City time) on the date of each 
Borrowing, each Bank participating therein shall (except as provided in 
subsection (c) of this Section) make available its share of such Borrowing, 
in Federal or other funds immediately available in New York City, to the 
Agent at its address referred to in Section 10.01.  Unless any applicable 
condition specified in Article 3 has not been satisfied, as

                                     19

<PAGE>

determined by the Agent in accordance with Article 3, the Agent will make the 
funds so received from the Banks immediately available to the Borrower at the 
Agent's aforesaid address.

     (c)  If any Bank makes a new Loan hereunder to the Borrower on a day on 
which the Borrower is to repay all or any part of an outstanding Loan from 
such Bank, such Bank shall apply the proceeds of its new Loan to make such 
repayment and only an amount equal to the difference (if any) between the 
amount being borrowed by the Borrower and the amount being repaid shall be 
made available by such Bank to the Agent as provided in subsection (b) of 
this Section, or remitted by the Borrower to the Agent as provided in Section 
2.12, as the case may be.

     (d)  Unless the Agent shall have received notice from a Bank prior to 
the date of any Borrowing (or, in the case of a Base Rate Borrowing, prior to 
Noon (New York City time) on the date of such Borrowing) that such Bank will 
not make available to the Agent such Bank's share of such Borrowing, the 
Agent may assume that such Bank has made such share available to the Agent on 
the date of such Borrowing in accordance with subsections (b) and (c) of this 
Section 2.04 and the Agent may, in reliance upon such assumption, make 
available to the Borrower on such date a corresponding amount. If and to the 
extent that such Bank shall not have so made such share available to the 
Agent, such Bank and the Borrower severally agree to repay to the Agent 
forthwith on demand such corresponding amount together with interest thereon, 
for each day from the date such amount is made available to the Borrower 
until the date such amount is repaid to the Agent, at (i) in the case of the 
Borrower, a rate per annum equal to the higher of the Federal Funds Rate and 
the interest rate applicable thereto pursuant to Section 2.07 and (ii) in the 
case of such Bank, the Federal Funds Rate. If such Bank shall repay to the 
Agent such corresponding amount, such amount so repaid shall constitute such 
Bank's Loan included in such Borrowing for purposes of this Agreement.  If 
the Borrower shall have repaid such corresponding amount of such Bank, such 
Bank shall reimburse the Borrower for any loss on account thereof incurred by 
the Borrower.

     Section 2.05. Notes. (a)  The Loans of each Bank to the Borrower shall 
be evidenced by a single Note of the Borrower payable to the order of such 
Bank for the account of its Applicable Lending Office, unless such Bank 
requests otherwise, in an amount equal to the aggregate unpaid principal 
amount of such Bank's Loans to the Borrower.

                                     20

<PAGE>

     (b)  Each Bank may, by notice to the Borrower and the Agent, request 
that its Loans of a particular type to the Borrower be evidenced by a 
separate Note of the Borrower in an amount equal to the aggregate unpaid 
principal amount of such Loans.  Each such Note shall be in substantially the 
form of Exhibit A hereto with appropriate modifications to reflect the fact 
that it evidences solely Loans of the relevant type.  Each reference in this 
Agreement to a "Note" or the "Notes" of such Bank shall be deemed to refer to 
and include any or all of such Notes, as the context may require.

     (c)  Upon receipt of each Bank's Note pursuant to Section 3.01, the 
Agent shall forward such Note to such Bank.  Each Bank shall record the date, 
amount and type of each Loan made by it to the Borrower and the date and 
amount of each payment of principal made with respect thereto, and may, if 
such Bank so elects in connection with any transfer or enforcement of its 
Note of the Borrower, endorse on the schedule forming a part thereof 
appropriate notations to evidence the foregoing information with respect to 
each such Loan to the Borrower then outstanding; provided that the failure of 
any Bank to make any such recordation or endorsement shall not affect the 
obligations of the Borrower hereunder or under the Notes.  Each Bank is 
hereby irrevocably authorized by the Borrower so to endorse its Notes and to 
attach to and make a part of any Note a continuation of any such schedule as 
and when required.

     Section 2.06. Maturity of Loans. Each Loan by a Bank included in any 
Borrowing made pursuant to Section 2.01(a) shall mature, and the principal 
amount thereof shall be due and payable, together with accrued interest 
thereon, on the Termination Date for such Bank.  Each Loan included in any 
Borrowing made pursuant to Section 2.01(d) shall mature, and the principal 
amount thereof shall be due and payable, together with accrued interest 
thereon, on the first anniversary of the Termination Date on which such 
Borrowing is made. Each Loan included in any Borrowing made pursuant to 
Section 2.03 shall mature, and the principal amount thereof shall be due and 
payable, together with accrued interest thereon, on the last day of the 
Interest Period applicable thereto.

     Section 2.07. Interest Rates. (a)  Each Domestic Loan shall bear 
interest on the outstanding principal amount thereof, for each day from the 
date such Loan is made until it becomes due, at a rate per annum equal to the 
Base Rate for such day.  Such interest shall be payable quarterly in arrears 
on the last day of each calendar quarter and, with respect to the principal 
amount of any Domestic Loan converted to a Euro-Dollar Loan,

                                     21

<PAGE>

on each date a Domestic Loan is so converted.  Any overdue principal of or 
interest on any Domestic Loan shall bear interest, payable on demand, for 
each day until paid at a rate per annum equal to the sum of 2% plus the rate 
otherwise applicable to Domestic Loans for such day.

     (b)  Each Euro-Dollar Loan shall bear interest on the outstanding 
principal amount thereof, for the Interest Period applicable thereto, at a 
rate per annum equal to the sum of the Euro-Dollar Margin plus the applicable 
Adjusted London Interbank Offered Rate.  Such interest shall be payable for 
each Interest Period on the last day thereof and, if such Interest Period is 
longer than three months, at intervals of three months after the first day 
thereof.

     The "Adjusted London Interbank Offered Rate" applicable to any Interest 
Period means a rate per annum equal to the quotient obtained (rounded upward, 
if necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable 
London Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar Reserve 
Percentage.

     "Euro-Dollar Margin" means a rate per annum determined in accordance 
with the Pricing Schedule.

     The "London Interbank Offered Rate" applicable to any Interest Period 
means the average (rounded upward, if necessary, to the next higher 1/16 of 
1%) of the respective rates per annum at which deposits in dollars are 
offered to each of the Euro-Dollar Reference Banks in the London interbank 
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business 
Days before the first day of such Interest Period in an amount approximately 
equal to the principal amount of the Euro-Dollar Loan of such Euro-Dollar 
Reference Bank to which such Interest Period is to apply and for a period of 
time comparable to such Interest Period.

     "Euro-Dollar Reserve Percentage" means for any day that percentage 
(expressed as a decimal) which is in effect on such day, as prescribed by the 
Board of Governors of the Federal Reserve System (or any successor) for 
determining the maximum reserve requirement for a member bank of the Federal 
Reserve System in New York City with deposits exceeding five billion dollars 
in respect of "Eurocurrency liabilities" (or in respect of any other category 
of liabilities which includes deposits by reference to which the interest 
rate on Euro-Dollar Loans is determined or any category of extensions of 
credit or other assets which includes loans by a non-United States office of 
any Bank to United States

                                     22

<PAGE>

residents).  The Adjusted London Interbank Offered Rate shall be adjusted 
automatically on and as of the effective date of any change in the 
Euro-Dollar Reserve Percentage.

     (c)  Any overdue principal of or interest on any Euro-Dollar Loan shall 
bear interest, payable on demand, for each day from and including the date 
payment thereof was due to but excluding the date of actual payment, at a 
rate per annum equal to the sum of 2% plus the higher of (i) the Euro-Dollar 
Margin plus the quotient obtained (rounded upward, if necessary, to the next 
higher 1/100 of 1%) by dividing (x) the average (rounded upward, if 
necessary, to the next higher 1/16 of 1%) of the respective rates per annum 
at which one day (or, if such amount due remains unpaid more than three 
Euro-Dollar Business Days, then for such other period of time not longer than 
six months as the Agent may select) deposits in dollars in an amount 
approximately equal to such overdue payment due to each of the Euro-Dollar 
Reference Banks are offered to such Euro-Dollar Reference Bank in the London 
interbank market for the applicable period determined as provided above by 
(y) 1.00 minus the Euro-Dollar Reserve Percentage (or, if the circumstances 
described in clause (a) or (b) of Section 8.01 shall exist, at a rate per 
annum equal to the sum of 2% plus the rate applicable to Domestic Loans for 
such day) and (ii) the sum of the Euro-Dollar Margin plus the Adjusted London 
Interbank Offered Rate applicable to such Loan at the date such payment was 
due.

     (d)  Subject to Section 8.01, each Money Market LIBOR Loan shall bear 
interest on the outstanding principal amount thereof, for the Interest Period 
applicable thereto, at a rate per annum equal to the sum of the London 
Interbank Offered Rate for such Interest Period (determined in accordance 
with Section 2.07(b) as if the related Money Market LIBOR Borrowing were a 
Committed Euro-Dollar Borrowing) plus (or minus) the Money Market Margin 
quoted by the Bank making such Loan in accordance with Section 2.03.  Each 
Money Market Absolute Rate Loan shall bear interest on the outstanding 
principal amount thereof, for the Interest Period applicable thereto, at a 
rate per annum equal to the Money Market Absolute Rate quoted by the Bank 
making such Loan in accordance with Section 2.03.  Such interest shall be 
payable for each Interest Period on the last day thereof and, if such 
Interest Period is longer than three months, at intervals of three months 
after the first day thereof.  Any overdue principal of or interest on any 
Money Market Loan shall bear interest, payable on demand, for each day until 
paid at a rate per annum equal to the sum of 2% plus the Base Rate for such 
day.

                                     23

<PAGE>

     (e)  The Agent shall determine each interest rate applicable to the 
Loans hereunder. The Agent shall give prompt notice to the Borrower and the 
participating Banks of each rate of interest so determined, and its 
determination thereof shall be conclusive in the absence of manifest error.

     (f)  Each Euro-Dollar Reference Bank agrees to use its best efforts to 
furnish quotations to the Agent as contemplated hereby.  If any Euro-Dollar 
Reference Bank does not furnish a timely quotation, the Agent shall determine 
the relevant interest rate on the basis of the quotation or quotations 
furnished by the remaining Euro-Dollar Reference Bank or Banks or, if none of 
such quotations is available on a timely basis, the provisions of Section 
8.01 shall apply.

     Section 2.08. Facility Fees. The Company shall pay to the Agent for the 
account of the Banks ratably a facility fee at the Facility Fee Rate 
(determined daily in accordance with the Pricing Schedule).  Such facility 
fee shall accrue (i) from and including the earlier of the Closing Date and  
December 31, 1996 to but excluding the Termination Date (or earlier date of 
termination of the Commitments in their entirety), on the daily average 
aggregate amount of the Commitments (whether used or unused) and (ii) from 
and including the Termination Date (or earlier date of termination of the 
Commitments in their entirety) to but excluding the date the Loans shall be 
repaid in their entirety, on the daily average aggregate outstanding 
principal amount of the Loans. Accrued facility fees shall be payable 
quarterly in arrears on the last day of each calendar quarter and upon the 
date of termination of the Commitments in their entirety (and, if later, the 
date the Loans shall be repaid in their entirety).

     "Facility Fee Rate" means a rate per annum determined in accordance with 
the Pricing Schedule.

     Section 2.09. Optional Termination or Reduction of Commitments. During 
the Revolving Credit Period, the Company may, upon at least three Domestic 
Business Days' notice to the Agent, (i) terminate the Commitments at any 
time, if no Loans are outstanding at such time or (ii) ratably reduce from 
time to time by an aggregate amount of $25,000,000 or any larger multiple of 
$5,000,000, the aggregate amount of the Commitments in excess of the 
aggregate outstanding principal amount of the Loans.

     Section 2.10. Method of Electing Interest Rates. (a)  The Loans included 
in each Committed Borrowing shall bear interest initially at the 

                                     24


<PAGE>

type of rate specified by the Borrower in the applicable Notice of Committed 
Borrowing.  Thereafter, the Borrower may from time to time elect to change or 
continue the type of interest rate borne by each Group of Loans (subject in 
each case to the provisions of Article 8), as follows:

(i)  if such Loans are Domestic Loans, the Borrower may elect to convert such 
Loans to Euro-Dollar Loans as of any Euro-Dollar Business Day;

(ii)  if such Loans are Euro-Dollar Loans, the Borrower may elect to convert 
such Loans to Domestic Loans or elect to continue such Loans as Euro-Dollar 
Loans for an additional Interest Period, in each case effective on the last 
day of the then current Interest Period applicable to such Loans.

Each such election shall be made by delivering a notice (a "Notice of 
Interest Rate Election") to the Agent at least three Euro-Dollar Business 
Days before the conversion or continuation selected in such notice is to be 
effective.  A Notice of Interest Rate Election may, if it so specifies, apply 
to only a portion of the aggregate principal amount of the relevant Group of 
Loans; provided that (i) such portion is allocated ratably among the Loans 
comprising such Group and (ii) the portion to which such Notice applies, and 
the remaining portion to which it does not apply, are each $25,000,000 or any 
larger multiple of $5,000,000.

(b)  Each Notice of Interest Rate Election shall specify:

(i)  the Group of Loans (or portion thereof) to which such notice applies;

(ii)  the date on which the conversion or continuation selected in such 
notice is to be effective, which shall comply with the applicable clause of 
subsection (a) above;

(iii)  if the Loans comprising such Group are to be converted, the new type 
of Loans and, if such new Loans are Euro-Dollar Loans, the duration of the 
initial Interest Period applicable thereto; and

(iv) if such Loans are to be continued as Euro-Dollar Loans for an additional 
Interest Period, the duration of such additional Interest Period.

Each Interest Period specified in a Notice of Interest Rate Election shall 
comply with the provisions of the definition of Interest Period.

                                     25

<PAGE>

(c)  Upon receipt of a Notice of Interest Rate Election from the Borrower 
pursuant to subsection (a) above, the Agent shall promptly notify each Bank 
of the contents thereof and such notice shall not thereafter be revocable by 
such Borrower.  If the Borrower fails to deliver a timely Notice of Interest 
Rate Election to the Agent for any Group of Euro-Dollar Loans, such Loans 
shall be converted into Domestic Loans on the last day of the then current 
Interest Period applicable thereto. 


Section 2.11 Optional Prepayments 



(a)  The Borrower may, upon at least one Domestic Business Day's notice to 
the Agent, prepay the Group of Domestic Loans (or any Money Market Borrowing 
bearing interest at the Base Rate pursuant to Section 8.01(a)) in whole at 
any time, or from time to time in part in amounts aggregating $25,000,000 or 
any larger multiple of $5,000,000, by paying the principal amount to be 
prepaid together with accrued interest thereon to the date of prepayment.

(b)  The Borrower may, upon at least three Euro-Dollar Business Days' notice 
to the Agent, in the case of a Group of Euro-Dollar Loans, prepay the Loans 
comprising such a Group on the last day of any Interest Period applicable to 
such Group, in whole at any time, or from time to time in part in amounts 
aggregating $25,000,000 or any larger multiple of $5,000,000, by paying the 
principal amount to be prepaid together with accrued interest thereon to the 
date of prepayment.

(c)  Except as provided in subsection (a) above, the Borrower may not prepay 
all or any portion of the principal  amount of any Money Market Loan prior to 
the maturity thereof.

(d)  Upon receipt of a notice of prepayment pursuant to this Section, the 
Agent shall promptly notify each Bank of the contents thereof and of such 
Bank's ratable share (if any) of such prepayment and such notice shall not 
thereafter be revocable by the Borrower.  Each such prepayment shall be 
applied to prepay ratably the Loans of the several Banks included in the 
relevant Group or Borrowing.

Section 2.12. General Provisions as to Payments. (a)  The Borrower shall make 
each payment of principal of, and interest on, the Loans and of fees and 
other amounts payable hereunder, not later than 12:00 Noon (New York City 
time) on the date when due, in Federal or other funds immediately available 
in New York City, without off set or counterclaim, to the Agent at its 
address referred to in Section 10.01.  The Agent will promptly distribute to 
each Bank its ratable 

                                    26

<PAGE>

share of each such payment received by the Agent for the account of the 
Banks.  Whenever any payment of principal of, or interest on, the Domestic 
Loans or of fees or other amounts payable hereunder shall be due on a day 
which is not a Domestic Business Day, the date for payment thereof shall be 
extended to the next succeeding Domestic Business Day.  Whenever any payment 
of principal of, or interest on, the Euro-Dollar Loans shall be due on a day 
which is not a Euro-Dollar Business Day, the date for payment thereof shall 
be extended to the next succeeding Euro-Dollar Business Day unless such 
Euro-Dollar Business Day falls in another calendar month, in which case the 
date for payment thereof shall be the next preceding Euro-Dollar Business 
Day.  Whenever any payment of principal of, or interest on, the Money Market 
Loans shall be due on a day which is not a Euro-Dollar Business Day, the date 
for payment thereof shall be extended to the next succeeding Euro-Dollar 
Business Day.  If the date for any payment of principal is extended by 
operation of law or otherwise, interest thereon shall be payable for such 
extended time.

(b)  Unless the Agent shall have received notice from the Borrower prior to 
the date on which any payment is due from the Borrower to the Banks hereunder 
that the Borrower will not make such payment in full, the Agent may assume 
that the Borrower has made such payment in full to the Agent on such date and 
the Agent may, in reliance upon such assumption, cause to be distributed to 
each Bank on such due date an amount equal to the amount then due such Bank.  
If and to the extent that the Borrower shall not have so made such payment, 
each Bank shall repay to the Agent forthwith on demand such amount 
distributed to such Bank together with interest thereon, for each day from 
the date such amount is distributed to such Bank until the date such Bank 
repays such amount to the Agent, at the Federal Funds Rate.

Section 2.13. Funding Losses. If the Borrower makes any payment of principal 
with respect to any Fixed Rate Loan or any Fixed Rate Loan is converted to a 
Domestic Loan (pursuant to Article 6 or 8 or otherwise) on any day other than 
the last day of an Interest Period applicable thereto, or the last day of an 
applicable period fixed pursuant to Section 2.07(c), or if the Borrower fails 
to borrow or prepay any Fixed Rate Loans after notice has been given to any 
Bank in accordance with Section 2.04(a) or 2.11(d), the Company shall 
reimburse each Bank within 15 days after demand for any resulting loss or 
expense incurred by it (or by an existing or prospective Participant in the 
related Loan), including (without limitation) any loss incurred in obtaining, 
liquidating or employing deposits from third parties, but excluding loss of 
margin for the period after any such payment or conversion or failure to 
borrow or prepay, provided that such Bank shall have delivered to the Company 
a certificate as to the amount of such 

                                      27

<PAGE>

loss or expense, which certificate shall be conclusive in the absence of 
manifest error.

Section 2.14. Computation of Interest and Fees. Interest based on the Prime 
Rate hereunder shall be computed on the basis of a year of 365 days (or 366 
days in a leap year) and paid for the actual number of days elapsed 
(including the first day but excluding the last day).  All other interest and 
fees hereunder shall be computed on the basis of a year of 360 days and paid 
for the actual number of days elapsed (including the first day but excluding 
the last day).

Section 2.15. Change of Control. If a Change of Control shall occur, the 
Company will, within ten days after the occurrence thereof, give each Bank 
notice thereof, which notice shall describe in reasonable details the facts 
and circumstances giving rise thereto and shall specify an Optional 
Termination Date for purposes of this Section (the "Optional Termination 
Date") which date shall not be less than 30 nor more than 60 days after the 
date of such notice.  Each Bank may, by notice to the Company and the Agent 
given not less than three Domestic Business Days prior to the Optional 
Termination Date, terminate its Commitment (if any), which shall thereupon be 
terminated, and declare the Note held by it (together with accrued interest 
thereon) and any other amounts payable hereunder for its account to be, and 
such Note and such other amounts shall thereupon become, due and payable 
without presentment, demand, protest or other notice of any kind, all of 
which are hereby waived by the Company and the Borrower, in each case 
effective on the Optional Termination Date.

A "Change of Control" shall occur if any person or group of persons (within 
the meaning of Section 13 or 14 of the Securities Exchange Act of 1934, as 
amended) shall have acquired beneficial ownership (within the meaning of Rule 
13d-3 promulgated by the Securities and Exchange Commission under said Act) 
of 30% or more of the outstanding shares of common stock of the Company; or, 
during any period of twelve consecutive calendar months, individuals who were 
directors of the Company on the first day of such period shall cease to 
constitute a majority of the board of directors of the Company.

                                    28

<PAGE>
                                  ARTICLE 3
                                 Conditions

Section 3.01. Closing. The closing hereunder shall occur upon receipt by the 
Agent of the following documents, each dated the Closing Date unless 
otherwise indicated:

(a)  a duly executed Note of the Borrower for the account of each Bank dated 
on or before the Closing Date complying with the provisions of Section 2.05;

(b)  an opinion of Stephen E. Brilz, Esq., counsel for the Company and the 
Borrower, substantially in the form of Exhibit E hereto and covering such 
additional matters relating to the transactions contemplated hereby as the 
Required Banks may reasonably request;

(c)  an opinion of Davis Polk & Wardwell, special counsel for the Agent, 
substantially in the form of Exhibit F hereto and covering such additional 
matters relating to the transactions contemplated hereby as the Required 
Banks may reasonably request; 

(d)  evidence satisfactory to the Agent that the commitments under the 
Existing Credit Agreements have been terminated and that the principal and 
interest on all loans and accrued fees outstanding thereunder have been paid 
in full; 

(e) evidence satisfactory to the Agent that all conditions to the 
consummation of the Acquisition have been satisfied; and

(f)  all documents the Agent may reasonably request relating to the existence 
of the Company, the corporate authority for and the validity of this 
Agreement and the Notes, and any other matters relevant hereto, all in form 
and substance satisfactory to the Agent.

The Agent shall promptly notify the Company and the Banks of the Closing 
Date, and such notice shall be conclusive and binding on all parties hereto.

Section 3.02. Borrowings. The obligation of any Bank to make a Loan on the 
occasion of any Borrowing is subject to the satisfaction of the following 
conditions:

                                  29

<PAGE>

(a)  the fact that the Closing Date shall have occurred on or prior to 
February 15, 1997;

(b)  receipt by the Agent of a Notice of Borrowing as required by Section 
2.02 or 2.03, as the case may be;

(c)  the fact that, immediately before and after such Borrowing, the 
aggregate outstanding principal amount of the Loans will not exceed the 
aggregate amount of the Commitments;

(d)  the fact that, immediately before and after such Borrowing, no Default 
shall have occurred and be continuing; and

(e)  the fact that the representations and warranties contained in this 
Agreement shall be true on and as of the date of such Borrowing (except, in 
the case of the representations and warranties contained in Section 4.04(c), 
as disclosed by the Borrower to the Banks in writing in the Notice of 
Borrowing relating to such Borrowing).

Each Borrowing hereunder shall be deemed to be a representation and warranty 
by the Borrower on the date of such Borrowing as to the facts specified in 
clauses (c), (d) and (e) of this Section.


                               ARTICLE 4
                      Representations and Warranties


Each of the Company and the Borrower represents and warrants that:

Section 4.01. Corporate Existence and Power. Each of the Company and the 
Borrower is a corporation duly incorporated, validly existing and in good 
standing under the laws of the state of its incorporation, and has all 
corporate powers and all material governmental licenses, authorizations, 
qualifications, consents and approvals required to carry on its business as 
now conducted.

Section 4.02. Corporate and Governmental Authorization; No Contravention. The 
execution, delivery and performance by the Company and the Borrower of this 
Agreement and by the Borrower of the Notes are within such Person's corporate 
powers, have been duly authorized by all necessary corporate action, require 
no action by or in respect of, or filing with, any governmental body, agency 
or official and do not contravene, or constitute a default under, any 

                                     30

<PAGE>

provision of applicable law or regulation or of the certificate of 
incorporation or by-laws of such Person or of any agreement, judgment, 
injunction, order, decree or other instrument binding upon such Person or any 
Significant Subsidiary or result in the creation or imposition of any Lien on 
any material asset of such Person or any Significant Subsidiary.

Section 4.03. Binding Effect. This Agreement constitutes a valid and binding 
agreement of the Company and the Borrower, and the Notes, when executed and 
delivered in accordance with this Agreement, will constitute valid and 
binding obligations of the Borrower.

Section 4.04. Financial Information.

(a)  The consolidated  balance sheet of the Company and its Consolidated 
Subsidiaries as of December 31, 1995 and the related consolidated statements 
of income and cash flows for the fiscal year then ended, reported on by 
Coopers & Lybrand and set forth in the Company's 1995 Form 10-K, a copy of 
which has been delivered to each of the Banks, fairly present, in conformity 
with generally accepted accounting principles, the consolidated financial 
position of the Company and its Consolidated Subsidiaries as of such date and 
their consolidated results of operations and cash flows for such fiscal year.

(b)  The unaudited consolidated balance sheet of the Company and its 
Consolidated Subsidiaries as of June 30, 1996 and the related unaudited 
consolidated statements of income and cash flows for the six months then 
ended, set forth in the Company's quarterly report for the fiscal quarter 
ended June 30, 1996 as filed with the Securities and Exchange Commission on 
Form 10-Q, a copy of which has been delivered to each of the Banks, fairly 
present, in conformity with generally accepted accounting principles applied 
on a basis consistent with the financial statements referred to in subsection 
(a) of this Section, the consolidated financial position of the Company and 
its Consolidated Subsidiaries as of such date and their consolidated results 
of operations and cash flows for such six month period (subject to normal 
year-end adjustments).

(c)  Since June 30, 1996 there has been no material adverse change in the 
financial position or results of operations of the Company and its 
Consolidated Subsidiaries, considered as a whole (it being understood that 
the consummation of the Acquisition shall not be considered such a change).

Section 4.05. Litigation. Except as disclosed in the Company's 1995 Form 10-K 
and quarterly report for the fiscal quarter ended June 30, 1996 as filed with 
the Securities and Exchange Commission on Form 10-Q, there is no action, 

                                      31

<PAGE>

suit or proceeding pending against, or to the knowledge of the Company 
threatened against or affecting, the Company or any of its Subsidiaries 
before any court or arbitrator or any governmental body, agency or official 
in which there is a reasonable possibility of an adverse decision which would 
materially adversely affect the consolidated financial position or 
consolidated results of operations of the Company and its Consolidated 
Subsidiaries, considered as a whole, or which in any manner draws into 
question the validity of this Agreement or the Notes.

Section 4.06. Compliance with ERISA. Each member of the ERISA Group has 
fulfilled its obligations under the minimum funding standards of ERISA and 
the Internal Revenue Code with respect to each Plan and is in compliance in 
all respects with the presently applicable provisions of ERISA and the 
Internal Revenue Code with respect to each Plan, except where failure to 
comply would not have a material adverse effect on the consolidated financial 
position or consolidated results of operations of the Company and its 
Consolidated Subsidiaries, considered as a whole.  No member of the ERISA 
Group has (i) sought a waiver of the minimum funding standard under Section 
412 of the Internal Revenue Code in respect of any Plan, (ii) failed to make 
any contribution or payment to any Plan or Multiemployer Plan or in respect 
of any Benefit Arrangement, or made any amendment to any Plan or Benefit 
Arrangement, which has resulted or could result in the imposition of a Lien 
or the posting of a bond or other security under ERISA or the Internal 
Revenue Code or (iii) incurred any liability under Title IV of ERISA other 
than a liability to the PBGC for premiums under Section 4007 of ERISA.

Section 4.07. Environmental Matters. (a)  The operations of the Company and 
each of its Subsidiaries comply in all respects with all Environmental Laws 
except such non-compliance which would not (if enforced in accordance with 
applicable law) reasonably be expected to result, individually or in the 
aggregate, in a material adverse effect on the financial position or results 
of operations of the Company and its Consolidated Subsidiaries, considered as 
a whole.

(b)  Except as specifically identified in Schedule 4.07, the Company and each 
of its Subsidiaries have obtained all material licenses, permits, 
authorizations and registrations required under any Environmental Laws 
("Environmental Permits") necessary for their respective operations, and all 
such Environmental Permits are in good standing, and the Company and each of 
its Subsidiaries is in compliance with all material terms and conditions of 
such Environmental Permits.

(c)  Except as specifically identified in Schedule 4.07, (i) none of the 
Company, any of its Subsidiaries or any of their present property or 
operations are 

                                  32

<PAGE>

subject to any outstanding written order from or settlement or consent 
agreement with any governmental authority or other Person, nor is any of the 
foregoing subject to any judicial or docketed administrative proceedings, 
respecting any Environmental Laws or Hazardous Substances with a potential 
liability in excess of $1,000,000 and (ii) there are no other conditions or 
circumstances known to the Company which may give rise to any claims 
respecting any Environmental Laws arising from the operations of the Company 
or its Subsidiaries (including, without limitation, off-site liabilities), or 
any additional costs of compliance with Environmental Laws, that would 
reasonably be expected to have a material adverse effect on the financial 
position or results of operations of the Company and its Subsidiaries, 
considered as a whole.

Section 4.08. Taxes. United States Federal income tax returns of the Company 
and its Subsidiaries have been examined and closed through the fiscal year 
ended December 31, 1987.  The Company and its Subsidiaries have filed all 
United States Federal income tax returns and all other material tax returns 
which are required to be filed by them and have paid all taxes due pursuant 
to such returns or pursuant to any assessment received by the Company or any 
Subsidiary, except for taxes the amount, applicability or validity of which 
is being contested in good faith by appropriate proceedings.  The charges, 
accruals and reserves on the books of the Company and its Subsidiaries in 
respect of taxes or other governmental charges are, in the opinion of the 
Company, adequate.

Section 4.09. Subsidiaries. Each of the Company's corporate Significant 
Subsidiaries (including, but not limited to, the Borrower) is a corporation 
duly incorporated, validly existing and in good standing under the laws of 
its jurisdiction of incorporation, and has all corporate powers and all 
material governmental licenses, authorizations, qualifications, consents and 
approvals required to carry on its business as now conducted.

Section 4.10. Not an Investment Company. Neither the Company nor the Borrower 
is an "investment company" within the meaning of the Investment Company Act 
of 1940, as amended.

Section 4.11. Full Disclosure. All written information heretofore furnished 
by the Company or the Borrower to the Agent or any Bank for purposes of or in 
connection with this Agreement or any transaction contemplated hereby is, and 
all such information hereafter furnished by the Company or the Borrower to 
the Agent or any Bank will be, true and accurate in all material respects on 
the date as of which such information is stated or certified.

                                    33

<PAGE>

                               ARTICLE 5
                               Covenants

The Company agrees that, so long as any Bank has any Commitment hereunder or 
any amount payable under any Note remains unpaid:

Section 5.01. Information. The Company will deliver to each of the Banks:

(a)  as soon as available and in any event within 95 days after the end of 
each fiscal year of the Company, a consolidated balance sheet of the Company 
and its Consolidated Subsidiaries as of the end of such fiscal year and the 
related consolidated statements of income and cash flows for such fiscal 
year, setting forth in each case in comparative form the figures for the 
previous fiscal year, all reported on in a manner acceptable to the 
Securities and Exchange Commission by Arthur Andersen L.L.P. or other 
independent public accountants of nationally recognized standing;

(b)  as soon as available and in any event within 50 days after the end of 
each of the first three quarters of each fiscal year of the Company, a 
consolidated balance sheet of the Company and its Consolidated Subsidiaries 
as of the end of such quarter and the related consolidated statements of 
income and cash flows for such quarter and for the portion of the Company's 
fiscal year ended at the end of such quarter, setting forth in the case of 
such statements of income and cash flows in comparative form the figures for 
the corresponding quarter and the corresponding portion of the Company's 
previous fiscal year, all certified (subject to normal year-end adjustments) 
as to fairness of presentation, generally accepted accounting principles and 
consistency by the chief financial officer or the chief accounting officer of 
the Company;

(c)  simultaneously with the delivery of each set of financial statements 
referred to in clauses (a) and (b) above, a certificate of the chief 
financial officer (or such officer's designee, designated in writing by such 
officer) or the chief accounting officer of the Company (i) setting forth in 
reasonable detail the calculations required to establish whether the Company 
was in compliance with the requirements of Sections 5.06 to 5.08, inclusive, 
on the date of such financial statements and (ii) stating whether any Default 
exists on the date of such certificate and, if any

                                    34

<PAGE>

Default then exists, setting forth the details thereof and the action which 
the Company is taking or proposes to take with respect thereto;

(d)  within five Domestic Business Days after any officer of the Company or 
the Borrower obtains knowledge of any Default, if such Default is then 
continuing, a certificate of the chief financial officer or the chief 
accounting officer of the Company or the Borrower setting forth the details 
thereof and the action which the Company or the Borrower is taking or 
proposes to take with respect thereto;

(e)  promptly upon the mailing thereof to the shareholders of the Company 
generally, copies of all financial statements, reports and proxy statements 
so mailed;

(f)  promptly upon the filing thereof, copies of all registration statements 
(other than the exhibits thereto and any registration statements on Form S-8 
or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their 
equivalents) (other than any amendment on Form 8-K the sole purpose of which 
is to file exhibits relating to existing Debt meeting the requirements of 
clause (ii) of the definition of Debt) which the Company shall have filed 
with the Securities and Exchange Commission;

(g)  if and when any member of the ERISA Group (i) gives or is required to 
give notice to the PBGC of any "reportable event" (as defined in Section 4043 
of ERISA) with respect to any Plan which might constitute grounds for a 
termination of such Plan under Title IV of ERISA, or knows that the plan 
administrator of any Plan has given or is required to give notice of any such 
reportable event, a copy of the notice of such reportable event given or 
required to be given to the PBGC; (ii) receives notice of complete or partial 
withdrawal liability under Title IV of ERISA or notice that any Multiemployer 
Plan is in reorganization, is insolvent or has been terminated, a copy of 
such notice; (iii) receives notice from the PBGC under Title IV of ERISA of 
an intent to terminate, impose liability (other than for premiums under 
Section 4007 of ERISA) in respect of, or appoint a trustee to administer any 
Plan, a copy of such notice; (iv) applies for a waiver of the minimum funding 
standard under Section 412 of the Internal Revenue Code, a copy of such 
application; (v) gives notice of intent to terminate any Plan under Section 
4041(c) of ERISA, a copy of such notice and other information filed with the 
PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 
of ERISA, a copy of such notice; or (vii) fails to make any payment or 
contribution to any Plan or Multiemployer Plan or in respect of any Benefit 
Arrangement or 

                                   35

<PAGE>

makes any amendment to any Plan or Benefit Arrangement which has resulted or 
could result in the imposition of a Lien or the posting of a bond or other 
security, a certificate of the chief financial officer or the chief 
accounting officer of the Company setting forth details as to such occurrence 
and action, if any, which the Company or applicable member of the ERISA Group 
is required or proposes to take; and

(h)  from time to time such additional information regarding the financial 
position or business of the Company and its Subsidiaries and the Borrower and 
its Subsidiaries as the Agent, at the request of any Bank, may reasonably 
request.

Section 5.02. Maintenance of Property; Insurance. (a)  The Company will keep, 
and will cause each Significant Subsidiary to keep, all property useful and 
necessary in its business in good working order and condition, ordinary wear 
and tear excepted.

(b)  The Company will maintain, and will cause each Significant Subsidiary to 
maintain (either in the name of the Borrower or in such Significant 
Subsidiary's own name), with financially sound and responsible insurance 
companies, insurance on all their respective properties in at least such 
amounts and against at least such risks (and with such risk retention) as are 
usually insured against in the same general area by companies of established 
repute engaged in the same or a similar business; and will furnish to the 
Banks, upon request from the Agent, information presented in reasonable 
detail as to the insurance so carried; provided that, in lieu of any such 
insurance, the Company and any Significant Subsidiary may maintain a system 
or systems of self-insurance and reinsurance which will accord with sound 
practices of similarly situated corporations maintaining such systems and 
with respect to which the Company or such Significant Subsidiary will 
maintain adequate insurance reserves, all in accordance with generally 
accepted accounting principles and in accordance with sound insurance 
principles and practice.

Section 5.03. Maintenance of Existence. The Company will, and will cause each 
Significant Subsidiary to, preserve, renew and keep in full force and effect 
their respective corporate existence and their respective rights, privileges 
and franchises necessary or desirable in the normal conduct of business; 
provided that nothing in this Section 5.03 shall prohibit or interfere with 
the Company's publicly announced strategy to discontinue or dispose of in one 
or more transactions the financial services businesses of it or of any of its 
Subsidiaries.

                                    36

<PAGE>

Section 5.04. Compliance with Laws. The Company will comply, and will cause 
each Significant Subsidiary to comply, in all material respects with all 
applicable laws, ordinances, rules, regulations, and requirements of 
governmental authorities (including, without limitation, Environmental Laws 
and ERISA and the rules and regulations thereunder), except where the 
necessity of compliance therewith is contested in good faith by appropriate 
proceedings and for which adequate reserves in conformity with generally 
accepted accounting principles have been established.

Section 5.05. Inspection of Property, Books and Records. The Company will 
keep, and will cause each Significant Subsidiary to keep, proper books of 
record and account in which full, true and correct entries shall be made of 
all dealings and transactions in relation to its business and activities; and 
will permit, and will cause each Significant Subsidiary to permit, 
representatives of any Bank at such Bank's expense to visit and inspect any 
of their respective properties, to examine and make abstracts from any of 
their respective books and records and to discuss their respective affairs, 
finances and accounts with their respective officers, employees and 
independent public accountants, all at such reasonable times and as often as 
may reasonably be desired.

Section 5.06. Subsidiary Debt. Total Debt of all Consolidated Subsidiaries 
(excluding Debt of a Consolidated Subsidiary to the Company or to a 
Wholly-Owned Consolidated Subsidiary) will at no time exceed 250% of 
Consolidated Net Worth.  For purposes of this Section, any preferred stock of 
a Consolidated Subsidiary other than the Borrower which is held by a Person 
other than the Company or a Wholly-Owned Consolidated Subsidiary shall be 
included, at the higher of its voluntary or involuntary liquidation value, in 
the Debt of such Consolidated Subsidiary.

Section 5.07. Debt Coverage. Consolidated Debt of the Company and its 
Consolidated Subsidiaries will at all times be less than 70% of the sum of 
consolidated Debt of the Company and its Consolidated Subsidiaries and 
consolidated shareowners' equity of the Company and its Consolidated 
Subsidiaries. 

Section 5.08. Negative Pledge. Neither the Company nor the Borrower will, and 
the Company will not permit any Subsidiary to, create, assume or suffer to 
exist any Lien on any asset now owned or hereafter acquired by it, except:

(a)  Liens existing on the date of this Agreement securing Debt outstanding 
on the date of this Agreement in an aggregate principal amount not exceeding 
$123,700,000;

                                     37

<PAGE>

(b)  any Lien existing on any asset of any corporation at the time such 
corporation becomes a Subsidiary and not created in contemplation of such 
event;

(c)  any Lien on any asset securing Debt incurred or assumed for the purpose 
of financing all or any part of the cost of acquiring such asset, provided 
that such Lien attaches to such asset concurrently with or within 180 days 
after the acquisition thereof;

(d)  any Lien on any asset of any corporation existing at the time such 
corporation is merged or consolidated with or into the Company or a 
Subsidiary and not created in contemplation of such event;

(e)  any Lien existing on any asset prior to the acquisition thereof by the 
Company or a Subsidiary and not created in contemplation of such acquisition;

(f)  any Lien on assets or capital stock of Minor Subsidiaries which secures 
Debt of Persons which are not Consolidated Subsidiaries in which the Company 
or any of its Subsidiaries has made investments ("Joint Ventures"), but for 
the payment of which Debt no other recourse may be had to the Company or any 
Subsidiaries ("Limited Recourse Debt"), or any Lien on equity interests in a 
Joint Venture securing Limited Recourse Debt of such Joint Venture;

(g)  any Lien arising out of the refinancing, replacement, extension, renewal 
or refunding of any Debt secured by any Lien permitted by any of the 
foregoing clauses of this Section, provided that such Debt is not increased 
and is not secured by any additional assets;

(h)  Liens arising in the ordinary course of business which (i) do not secure 
Debt, (ii) do not secure any obligation in an amount exceeding $50,000,000 
and (iii) do not in the aggregate materially detract from the value of its 
assets or materially impair the use thereof in the operation of its business;

(i)  Liens not otherwise permitted by and in addition to the foregoing 
clauses of this Section securing Debt in an aggregate principal amount at any 
time outstanding not to exceed 10% of Consolidated Net Worth; and

                                    38

<PAGE>

(j) any Lien on Margin Stock, if and to the extent the value of all Margin 
Stock of the Company and its Subsidiaries exceeds 25% of the value of the 
total assets subject to this Section.

Section 5.09. Consolidations, Mergers and Sales of Assets. The Company will 
not (i) consolidate with or merge into any other Person or (ii) sell, lease 
or otherwise transfer, directly or indirectly, all or substantially all of 
the assets of the Company and its Subsidiaries, taken as a whole, to any 
other Person.  The Company will retain ownership, directly or indirectly, of 
at least 80% of the capital stock, and at least 80% of the voting power, of U 
S WEST Communications, Inc. ("Communications"), and will cause Communications 
to continue to own substantially all of the telecommunications assets it owns 
on the date of this Agreement.  Nothing in this Section shall be construed to 
restrict any sales of Margin Stock for fair value as determined in good faith 
by the board of directors of the Company.

Section 5.10. Use of Proceeds. The proceeds of the Loans made under this 
Agreement will be used by the Borrower for financing the Acquisition and for 
general corporate purposes.  None of such proceeds will be used, directly or 
indirectly, in violation of any applicable law or regulation, and no use of 
such proceeds for general corporate purposes will include any use for the 
purpose, whether immediate, incidental or ultimate, of buying or carrying any 
Margin Stock.



                             ARTICLE 6
                             Defaults

Section 6.01. Events of Default. If one or more of the following events shall 
have occurred and be continuing:

(a)  any principal of any Loan shall not be paid when due, or any interest, 
any fees or any other amount payable hereunder shall not be paid within five 
days of the due date thereof;

(b)  the Company or the Borrower shall fail to observe or perform any 
covenant contained in Sections 5.06 to 5.10, inclusive;

(c)  the Company or the Borrower shall fail to observe or perform any 
covenant or agreement contained in this Agreement (other than those 

                                   39


<PAGE>

covered by clause (a) or (b) above) for 10 days after written notice thereof 
has been given to the Company by the Agent at the request of any Bank;

(d)  any representation, warranty, certification or statement made by the 
Company or the Borrower in this Agreement or in any certificate, financial 
statement or other document delivered pursuant to this Agreement shall prove 
to have been incorrect in any material respect when made (or deemed made);

(e)  the Company or any Subsidiary shall fail to make any payment or 
payments, in the aggregate in excess of $100,000,000, in respect of any 
Material Debt when due or within any applicable grace period;

(f)  any event or condition shall occur which results in the acceleration of 
the maturity of any Material Debt;

(g)  the Company or any Significant Subsidiary shall commence a voluntary 
case or other proceeding seeking liquidation, reorganization or other relief 
with respect to itself or its debts under any bankruptcy, insolvency or other 
similar law now or hereafter in effect or seeking the appointment of a 
trustee, receiver, liquidator, custodian or other similar official of it or 
any substantial part of its property, or shall consent to any such relief or 
to the appointment of or taking possession by any such official in an 
involuntary case or other proceeding commenced against it, or shall make a 
general assignment for the benefit of creditors, or shall fail generally to 
pay its debts as they become due, or shall take any corporate action to 
authorize or otherwise acquiesce in any of the foregoing;

(h)  an involuntary case or other proceeding shall be commenced against the 
Company or any Significant Subsidiary seeking liquidation, reorganization or 
other relief with respect to it or its debts under any bankruptcy, insolvency 
or other similar law now or hereafter in effect or seeking the appointment of 
a trustee, receiver, liquidator, custodian or other similar official of it or 
any substantial part of its property, and such involuntary case or other 
proceeding shall remain undismissed and unstayed for a period of 60 days; or 
an order for relief shall be entered against the Company or any Significant 
Subsidiary under the federal bankruptcy laws as now or hereafter in effect;

(i)  any member of the ERISA Group shall fail to pay when due an amount or 
amounts aggregating in excess of $100,000,000 which it shall have become 
liable to pay under Title IV of ERISA; or notice of intent to 

                                     40

<PAGE>

terminate a Material Plan shall be filed under Title IV of ERISA by any 
member of the ERISA Group, any plan administrator or any combination of the 
foregoing; or the PBGC shall institute proceedings under Title IV of ERISA to 
terminate, to impose liability (other than for premiums under Section 4007 of 
ERISA) in respect of, or to cause a trustee to be appointed to administer any 
Material Plan; or a condition shall exist by reason of which the PBGC would 
be entitled to obtain a decree adjudicating that any Material Plan must be 
terminated; or there shall occur a complete or partial withdrawal from, or a 
default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, 
one or more Multiemployer Plans which could cause one or more members of the 
ERISA Group to incur a current payment obligation in excess of $100,000,000;

(j)  a judgment or order for the payment of money in excess of $100,000,000 
shall be rendered against the Company or any Subsidiary and such judgment or 
order shall continue unsatisfied and unstayed for a period of 10 days;

(k)  the Company shall repudiate in writing any of its obligations under 
Article 9 or any such obligation shall be unenforceable against the Company 
in accordance with its terms, or the Company shall so assert in writing; or

(l) (i) Continental Cablevision, Inc. shall have merged with and into the 
Company and Debt is outstanding under the Indentures, and (ii) one or more 
events or conditions shall occur which result in a default under any 
agreement or agreements in respect of any Material Debt that is subject to 
the Indentures and as a consequence of such default or defaults the Company 
or any of its Subsidiaries shall make any payment or give or agree to give 
any consideration or benefit of any kind (including, without limitation, any 
increased compensation, prepayment, shortening of maturities, security or 
other credit support) to the holders of such Debt and such payment, 
consideration or benefit is determined by the Required Banks, after taking 
into account any payment, consideration or benefit made, given or agreed to 
be given by such holders to the Company or any of its Subsidiaries (other 
than a waiver of such default), to be a material benefit to the holders of 
such Debt;

then, and in every such event, the Agent shall (i) if requested by Banks 
having more than 50% in aggregate amount of the Commitments, by notice to the 
Company terminate the Commitments and they shall thereupon terminate, and/or 
(ii) if requested by Banks holding Notes evidencing more than 50% in 
aggregate 

                                     41

<PAGE>

principal amount of the Loans, by notice to the Company declare the Notes 
(together with accrued interest thereon) to be, and the Notes shall thereupon 
become, immediately due and payable without presentment, demand, protest or 
other notice of any kind, all of which are hereby waived by the Company and 
the Borrower; provided that in the case of any of the Events of Default 
specified in clause (g) or (h) above with respect to the Company or the 
Borrower, without any notice to the Company or the Borrower or any other act 
by the Agent or the Banks, the Commitments shall thereupon automatically 
terminate and the Notes (together with accrued interest thereon) shall become 
immediately due and payable without presentment, demand, protest or other 
notice of any kind, all of which are hereby waived by the Company and the 
Borrower.

Section 6.02. Notice of Default. The Agent shall give notice to the Company 
under Section 6.01(c) promptly upon being requested to do so by any Bank and 
shall thereupon notify all the Banks thereof.

                            ARTICLE 7
                            The Agent

Section 7.01. Appointment and Authorization. Each Bank irrevocably appoints 
and authorizes the Agent to take such action as agent on its behalf and to 
exercise such powers under this Agreement and the Notes as are delegated to 
the Agent by the terms hereof or thereof, together with all such powers as 
are reasonably incidental thereto. 

Section 7.02. Agent and Affiliates. Morgan Guaranty Trust Company of New York 
shall have the same rights and powers under this Agreement as any other Bank 
and may exercise or refrain from exercising the same as though it were not 
the Agent, and Morgan Guaranty Trust Company of New York and its affiliates 
may accept deposits from, lend money to, and generally engage in any kind of 
business with the Company, the Borrower or any Subsidiary or affiliate of the 
Company or the Borrower as if it were not the Agent hereunder.

Section 7.03. Action by Agent. The obligations of the Agent hereunder are 
only those expressly set forth herein.  Without limiting the generality of 
the foregoing, the Agent shall not be required to take any action with 
respect to any Default, except as expressly provided in Article 6.

Section 7.04. Consultation with Experts. The Agent may consult with legal 
counsel (who may be counsel for the Company or the Borrower), 

                                     42

<PAGE>

independent public accountants and other experts selected by it and shall not 
be liable for any action taken or omitted to be taken by it in good faith in 
accordance with the advice of such counsel, accountants or experts.

Section 7.05. Liability of Agent. Neither the Agent nor any of its affiliates 
nor any of their respective directors, officers, agents or employees shall be 
liable for any action taken or not taken by it in connection herewith (i) 
with the consent or at the request of the Required Banks or (ii) in the 
absence of its own gross negligence or willful misconduct.  Neither the Agent 
nor any of its affiliates nor any of their respective directors, officers, 
agents or employees shall be responsible for or have any duty to ascertain, 
inquire into or verify (i) any statement, warranty or representation made in 
connection with this Agreement or any borrowing hereunder; (ii) the 
performance or observance of any of the covenants or agreements of the 
Company or the Borrower; (iii) the satisfaction of any condition specified in 
Article 3, except receipt of items required to be delivered to the Agent; or 
(iv) the validity, effectiveness or genuineness of this Agreement, the Notes 
or any other instrument or writing furnished in connection herewith.  The 
Agent shall not incur any liability by acting in reliance upon any notice, 
consent, certificate, statement, or other writing (which may be a bank wire, 
telex or similar writing) believed by it to be genuine or to be signed by the 
proper party or parties.

Section 7.06. Indemnification. Each Bank shall, ratably in accordance with 
its Commitment, indemnify the Agent, its affiliates and their respective 
directors, officers, agents and employees (to the extent not reimbursed by 
the Company or the Borrower) against any cost, expense (including counsel 
fees and disbursements), claim, demand, action, loss or liability (except 
such as result from such indemnitees' gross negligence or willful misconduct) 
that such indemnitees may suffer or incur in connection with this Agreement 
or any action taken or omitted by such indemnitees hereunder.

Section 7.07. Credit Decision. Each Bank acknowledges that it has, 
independently and without reliance upon the Agent or any other Bank, and 
based on such documents and information as it has deemed appropriate, made 
its own credit analysis and decision to enter into this Agreement.  Each Bank 
also acknowledges that it will, independently and without reliance upon the 
Agent or any other Bank, 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 any action under this Agreement.

Section 7.08. Successor Agent. The Agent may resign at any time by giving 
notice thereof to the Banks and the Company.  Upon any such resignation, 

                                    43

<PAGE>

the Required Banks shall have the right to appoint a successor Agent.  If no 
successor Agent shall have been so appointed by the Required Banks, and shall 
have accepted such appointment, within 30 days after the retiring Agent gives 
notice of resignation, then the retiring Agent may, on behalf of the Banks, 
appoint a successor Agent (with the consent of the Company, such consent not 
to be unreasonably withheld), which shall be a commercial bank organized or 
licensed under the laws of the United States of America or of any State 
thereof and having a combined capital and surplus of at least $400,000,000.  
Upon the acceptance of its appointment as Agent hereunder by a successor 
Agent, such successor Agent shall thereupon succeed to and become vested with 
all the rights and duties of the retiring Agent, and the retiring Agent shall 
be discharged from its duties and obligations hereunder.  After any retiring 
Agent's resignation hereunder as Agent, the provisions of this Article shall 
inure to its benefit as to any actions taken or omitted to be taken by it 
while it was Agent.

Section 7.09. Agent's Fee. The Company shall pay to the Agent for its own 
account fees in the amounts and at the times previously agreed upon between 
the Company and the Agent.

Section 7.10. Other Agents. Neither Citibank, N.A. nor The Bank of New York 
shall have any responsibility, obligation or liability under this Agreement 
in its capacity as Syndication Agent or Documentation Agent, respectively.

                                ARTICLE 8
                         Changes in Circumstances

Section 8.01. Basis for Determining Interest Rate Inadequate or UnfairIf on 
or prior to the first day of any Interest Period for any Euro-Dollar Loan or 
Money Market LIBOR Loan:

(a)  the Agent is advised by the Euro-Dollar Reference Banks that deposits in 
dollars (in the applicable amounts) are not being offered to the Euro-Dollar 
Reference Banks in the market for such Interest Period, or

(b)  in the case of Euro-Dollar Loans, Banks having 50% or more of the 
aggregate amount of the Euro-Dollar Loans advise the Agent that the Adjusted 
London Interbank Offered Rate as determined by the Agent will not adequately 
and fairly reflect the cost to such Banks of funding their Euro-Dollar Loans 
for such Interest Period,

                                     44

<PAGE>

the Agent shall forthwith give notice thereof to the Company and the Banks, 
whereupon until the Agent notifies the Company that the circumstances giving 
rise to such suspension no longer exist, (i) the obligations of the Banks to 
make Euro-Dollar Loans or to convert outstanding Loans into Euro-Dollar Loans 
shall be suspended and (ii) each outstanding Euro-Dollar Loan shall be 
converted into a Domestic Loan on the last day of the then current Interest 
Period applicable thereto.  Unless the Borrower notifies the Agent at least 
two Domestic Business Days before the date of any Fixed Rate Borrowing for 
which a Notice of Borrowing has previously been given that it elects not to 
borrow on such date, (i) if such Fixed Rate Borrowing is a Committed 
Borrowing, such Borrowing shall instead be made as a Domestic Borrowing and 
(ii) if such Fixed Rate Borrowing is a Money Market LIBOR Borrowing, the 
Money Market LIBOR Loans comprising such Borrowing shall bear interest for 
each day from and including the first day to but excluding the last day of 
the Interest Period applicable thereto at the Base Rate for such day.

Section 8.02. Illegality. If, on or after the date of this Agreement, the 
adoption of any applicable law, rule or regulation, or any change in any 
applicable law, rule or regulation, or any change in the interpretation or 
administration thereof by any governmental authority, central bank or 
comparable agency charged with the interpretation or administration thereof, 
or compliance by any Bank (or its Euro-Dollar Lending Office) with any 
request or directive (whether or not having the force of law) of any such 
authority, central bank or comparable agency shall make it unlawful or 
impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain 
or fund its Euro-Dollar Loans to the Borrower and such Bank shall so notify 
the Agent, the Agent shall forthwith give notice thereof to the other Banks 
and the Company, whereupon until such Bank notifies the Company and the Agent 
that the circumstances giving rise to such suspension no longer exist, the 
obligation of such Bank to make Euro-Dollar Loans to the Borrower, or to 
convert outstanding Loans into Euro-Dollar Loans, shall be suspended.  Before 
giving any notice to the Agent pursuant to this Section, such Bank shall 
designate a different Euro-Dollar Lending Office if such designation will 
avoid the need for giving such notice and will not, in the judgment of such 
Bank, be otherwise disadvantageous to such Bank.  If such notice is given, 
each Euro-Dollar Loan of such Bank then outstanding shall be converted to a 
Domestic Loan either (a) on the last day of the then current Interest Period 
applicable to such Euro-Dollar Loan if such Bank may lawfully continue to 
maintain and fund such Loan to such day or (b) immediately if such Bank shall 
determine that it may not lawfully continue to maintain and fund such Loan to 
such day.

Section 8.03. Increased Cost and Reduced Return. (a)  If on or after (x) the 
date hereof, in the case of any Committed Loan or any obligation to make 

                                    45

<PAGE>

Committed Loans or (y) the date of the related Money Market Quote, in the 
case of any Money Market Loan, the adoption of any applicable law, rule or 
regulation, or any change in any applicable law, rule or regulation, or any 
change in the interpretation or administration thereof by any governmental 
authority, central bank or comparable agency charged with the interpretation 
or administration thereof, or compliance by any Bank (or its Applicable 
Lending Office) with any request or directive (whether or not having the 
force of law) of any such authority, central bank or comparable agency shall 
impose, modify or deem applicable any reserve (including, without limitation, 
any such requirement imposed by the Board of Governors of the Federal Reserve 
System with respect to any Euro-Dollar Loan any such requirement included in 
an applicable Euro-Dollar Reserve Percentage), special deposit, insurance 
assessment or similar requirement against assets of, deposits with or for the 
account of, or credit extended by, any Bank (or its Applicable Lending 
Office) or shall impose on any Bank (or its Applicable Lending Office) or on 
the United States market for certificates of deposit or the London interbank 
market any other condition affecting its Fixed Rate Loans, its Note or its 
obligation to make Fixed Rate Loans and the result of any of the foregoing is 
to increase the cost to such Bank (or its Applicable Lending Office) of 
making or maintaining any Fixed Rate Loan, or to reduce the amount of any sum 
received or receivable by such Bank (or its Applicable Lending Office) under 
this Agreement or under its Note with respect thereto, by an amount deemed by 
such Bank to be material, then, within 15 days after demand by such Bank 
(with a copy to the Agent), the Company shall pay to such Bank such 
additional amount or amounts as will compensate such Bank for such increased 
cost or reduction.

(b)  If any Bank shall have determined that, after the date hereof, the 
adoption of any applicable law, rule or regulation regarding capital 
adequacy, or any change in any such law, rule or regulation, or any change in 
the interpretation or administration thereof by any governmental authority, 
central bank or comparable agency charged with the interpretation or 
administration thereof, or any request or directive regarding capital 
adequacy (whether or not having the force of law) of any such authority, 
central bank or comparable agency, has or would have the effect of reducing 
the rate of return on capital of such Bank (or its Parent) as a consequence 
of such Bank's obligations hereunder to a level below that which such Bank 
(or its Parent) could have achieved but for such adoption, change, request or 
directive (taking into consideration its policies with respect to capital 
adequacy) by an amount deemed by such Bank to be material, then from time to 
time, within 15 days after demand by such Bank (with a copy to the Agent), 
the Company shall pay to such Bank such additional amount or amounts as will 
compensate such Bank (or its Parent) for such reduction.

                                    46

<PAGE>

(c)  Each Bank will promptly notify the Company and the Agent of any event of 
which it has knowledge, occurring after the date hereof, which will entitle 
such Bank to compensation pursuant to this Section and will designate a 
different Applicable Lending Office if such designation will avoid the need 
for, or reduce the amount of, such compensation and will not, in the judgment 
of such Bank, be otherwise disadvantageous to such Bank.  A certificate of 
any Bank claiming compensation under this Section and setting forth the 
additional amount or amounts to be paid to it hereunder shall be conclusive 
in the absence of manifest error.  In determining such amount, such Bank may 
use any reasonable averaging and attribution methods.

Section 8.04. Taxes. (a)  Any and all payments by the Company or the Borrower 
to or for the account of any Bank or the Agent hereunder or under any Note 
shall be made free and clear of and without deduction for any and all present 
or future taxes, duties, levies, imposts, deductions, charges or 
withholdings, and all liabilities with respect thereto, excluding, in the 
case of each Bank and the Agent, taxes imposed on its income, and franchise 
taxes imposed on it, by the jurisdiction under the laws of which such Bank or 
the Agent (as the case may be) is organized or any political subdivision 
thereof and, in the case of each Bank, taxes imposed on its income, and 
franchise or similar taxes imposed on it, by the jurisdiction of such Bank's 
Applicable Lending Office or any political subdivision thereof (all such 
non-excluded taxes, duties, levies, imposts, deductions, charges, 
withholdings and liabilities being hereinafter referred to as "Taxes").  If 
the Company or the Borrower shall be required by law to deduct any Taxes from 
or in respect of any sum payable hereunder or under any Note to any Bank or 
the Agent, (i) the sum payable shall be increased as necessary so that after 
making all required deductions (including deductions applicable to additional 
sums payable under this Section 8.04) such Bank or the 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 Person shall make such deductions, (iii) such 
Person shall pay the full amount deducted to the relevant taxation authority 
or other authority in accordance with applicable law and (iv) such Person 
shall furnish to the Agent, at its address referred to in Section 10.01, the 
original or a certified copy of a receipt evidencing payment thereof.

(b)  In addition, the Company agrees to pay any present or future stamp or 
documentary taxes and any other excise or property taxes, or charges or 
similar levies which arise from any payment made hereunder or under any Note 
or from the execution or delivery of, or otherwise with respect to, this 
Agreement or any Note (hereinafter referred to as "Other Taxes").

                                     47

<PAGE>

(c)  The Company agrees to indemnify each Bank and the Agent for the full 
amount of Taxes or Other Taxes (including, without limitation, any Taxes or 
Other Taxes imposed or asserted by any jurisdiction on amounts payable under 
this Section 8.04) paid by such Bank or the Agent (as the case may be) and 
any liability (including penalties, interest and expenses) arising therefrom 
or with respect thereto.  This indemnification shall be made within 15 days 
from the date such Bank or the Agent (as the case may be) makes demand 
therefor.

(d)  Each Bank organized under the laws of a jurisdiction outside the United 
States, on or prior to the date of its execution and delivery of this 
Agreement in the case of each Bank listed on the signature pages hereof and 
on or prior to the date on which it becomes a Bank in the case of each other 
Bank, and from time to time thereafter if requested in writing by the Company 
(but only so long as such Bank remains lawfully able to do so), shall provide 
the Company with Internal Revenue Service form 1001 or 4224, as appropriate, 
or any successor form prescribed by the Internal Revenue Service, certifying 
that such Bank is entitled to benefits under an income tax treaty to which 
the United States is a party which reduces the rate of withholding tax on 
payments of interest or certifying that the income receivable pursuant to 
this Agreement is effectively connected with the conduct of a trade or 
business in the United States.  If the form provided by a Bank at the time 
such Bank first becomes a party to this Agreement indicates a United States 
interest withholding tax rate in excess of zero, withholding tax at such rate 
shall be considered excluded from "Taxes" as defined in Section 8.04(a) 
imposed by the United States.

(e)  For any period with respect to which a Bank has failed to provide the 
Company with the appropriate form pursuant to Section 8.04(d) (unless such 
failure is due to a change in treaty, law or regulation occurring subsequent 
to the date on which a form originally was required to be provided), such 
Bank shall not be entitled to indemnification under Section 8.04(a) with 
respect to Taxes imposed by the United States; provided, however, that should 
a Bank, which is otherwise exempt from or subject to a reduced rate of 
withholding tax, become subject to Taxes because of its failure to deliver a 
form required hereunder, the Company shall take such steps as such Bank shall 
reasonably request to assist such Bank to recover such Taxes.

(f)  If the Company or the Borrower is required to pay additional amounts to 
or for the account of any Bank pursuant to this Section 8.04, then such Bank 
will change the jurisdiction of its Applicable Lending Office so as to 
eliminate or reduce any such additional payment which may thereafter accrue 
if such change, in the judgment of such Bank, is not otherwise 
disadvantageous to such Bank.

                                   48

<PAGE>

Section 8.05. Domestic Loans Substituted for Affected Euro-Dollar Loans. If 
(i) the obligation of any Bank to make Euro-Dollar Loans to the Borrower has 
been suspended pursuant to Section 8.02 or (ii) any Bank has demanded 
compensation under Section 8.03 or 8.04 with respect to its Euro-Dollar Loans 
and the Borrower shall, by at least five Euro-Dollar Business Days' prior 
notice to such Bank through the Agent, have elected that the provisions of 
this Section shall apply to such Bank, then, unless and until such Bank 
notifies the Company that the circumstances giving rise to such suspension or 
demand for compensation no longer exist:

(a)  all Loans to the Borrower which would otherwise be made by such Bank as 
(or continued as or converted into) Euro-Dollar Loans shall instead be 
Domestic Loans (on which interest and principal shall be payable 
contemporaneously with the related Euro-Dollar Loans of the other Banks), and

(b)  after each of its Euro-Dollar Loans to the Borrower has been repaid (or 
converted to a Domestic Loan), all payments of principal which would 
otherwise be applied to repay such Euro-Dollar Loans shall be applied to 
repay its Domestic Loans instead.

If such Bank notifies the Borrower that the circumstances giving rise to such 
notice no longer apply, the principal amount of each such Domestic Loan shall 
be converted into a Euro-Dollar Loan on the first day of the next succeeding 
Interest Period applicable to the related Euro-Dollar Loans of the other 
Banks.

Section 8.06. Substitution of Bank. If (i) the obligation of any Bank to make 
Euro-Dollar Loans has been suspended pursuant to Section 8.02, (ii) any Bank 
has demanded compensation under Section 8.03 or (iii) any Bank has not signed 
an amendment or waiver which must be signed by all the Banks to become 
effective, and such amendment or waiver has been signed by the Super-Majority 
Banks, the Company shall have the right, with the assistance of the Agent, to 
seek a mutually satisfactory substitute bank or banks (which may be one or 
more of the Banks) to purchase the Notes and assume the Commitment of such 
Bank.

                                     49

<PAGE>
                                ARTICLE 9
                                 Guaranty


Section 9.01. The Guaranty. The Company hereby unconditionally guarantees the 
full and punctual payment (whether at stated maturity, upon acceleration or 
otherwise) of the principal of and interest on each Note issued by the 
Borrower pursuant to this Agreement, and the full and punctual payment of all 
other amounts payable by the Borrower under this Agreement.  Upon failure by 
the Borrower to pay punctually any such amount, the Company shall forthwith 
on demand pay the amount not so paid at the place and in the manner specified 
in this Agreement.

Section 9.02. Guaranty Unconditional. The obligations of the Company 
hereunder shall be unconditional, irrevocable and absolute and, without 
limiting the generality of the foregoing, shall not be released, discharged 
or otherwise affected by:

(i)  any extension, renewal, settlement, compromise, waiver or release in 
respect of any obligation of the Borrower under this Agreement or any Note, 
by operation of law or otherwise;

(ii)  any modification or amendment of or supplement to this Agreement or any 
Note;

(iii)  any release, impairment, non-perfection or invalidity of any direct or 
indirect security for any obligation of the Borrower under this Agreement or 
any Note;

(iv)  any change in the corporate existence, structure or ownership of the 
Borrower, or any insolvency, bankruptcy, reorganization or other similar 
proceeding affecting the Borrower or its assets or any resulting release or 
discharge of any obligation of the Borrower contained in this Agreement or 
any Note;

(v)  the existence of any claim, set-off or other rights which the Company 
may have at any time against the Borrower, the Agent, any Bank or any other 
Person, whether in connection herewith or any unrelated transactions, 
provided that nothing herein shall prevent the assertion of any such claim by 
separate suit or compulsory counterclaim;

(vi)  any invalidity or unenforceability relating to or against the Borrower 
for any reason of this Agreement or any Note, or any provision 

                                    50

<PAGE>

of applicable law or regulation purporting to prohibit the payment by the 
Borrower of the principal of or interest on any Note or any other amount 
payable by it under this Agreement; or

(vii)  any other act or omission to act or delay of any kind by the Borrower, 
the Agent, any Bank or any other Person or any other circumstance whatsoever 
which might, but for the provisions of this paragraph, constitute a legal or 
equitable discharge of the Company's obligations hereunder.

Section 9.03. Discharge Only upon Payment in Full; Reinstatement In Certain 
Circumstances. The Company's obligations hereunder shall remain in full force 
and effect until the Commitments shall have terminated and the principal of 
and interest on the Notes and all other amounts payable by the Company and 
the Borrower under this Agreement shall have been indefeasibly paid in full.  
If at any time any payment of the principal of or interest on any Note or any 
other amount payable by the Borrower under this Agreement is rescinded or 
must be otherwise restored or returned upon the insolvency, bankruptcy or 
reorganization of the Borrower or otherwise, the Company's obligations 
hereunder with respect to such payment shall be reinstated at such time as 
though such payment had been due but not made at such time.

Section 9.04. Waiver by the Company. The Company irrevocably waives 
acceptance hereof, presentment, demand, protest and any notice not provided 
for herein, as well as any requirement that at any time any action be taken 
by any Person against the Borrower or any other Person.

Section 9.05. Subrogation. The Company irrevocably waives any and all rights 
to which it may be entitled, by operation of law or otherwise, upon making 
any payment hereunder to be subrogated to the rights of the payee against the 
Borrower with respect to such payment or against any direct or indirect 
security therefor, or otherwise to be reimbursed, indemnified or exonerated 
by or for the account of the Borrower in respect thereof.

Section 9.06. Stay of Acceleration. In the event that acceleration of the 
time for payment of any amount payable by the Borrower under this Agreement 
or its Notes is stayed upon insolvency, bankruptcy or reorganization of the 
Borrower, all such amounts otherwise subject to acceleration under the terms 
of this Agreement shall nonetheless be payable by the Company hereunder 
forthwith on demand by the Agent made at the request of the Required Banks.

                                      51

<PAGE>


                            ARTICLE 10
                           Miscellaneous

Section 10.01. Notices. All notices, requests and other communications to any 
party hereunder shall be in writing (including bank wire, telex, facsimile 
transmission or similar writing) and shall be given to such party:  (x) in 
the case of the Company, the Borrower or the Agent, at its address or 
facsimile number set forth on the signature pages hereof, (y) in the case of 
any Bank, at its address or facsimile number set forth in its Administrative 
Questionnaire or (z) in the case of any party, such other address or 
facsimile number as such party may hereafter specify for the purpose by 
notice to the Agent and the Company.  Each such notice, request or other 
communication shall be effective (i) if given by mail, 72 hours after such 
communication is deposited in the mails with first class postage prepaid, 
addressed as aforesaid, (ii) if given by facsimile transmission, when such 
facsimile is transmitted to the facsimile number specified pursuant to this 
Section 10.01 and telephonic confirmation of receipt thereof is received, or 
(iii) if given by any other means, when delivered at the address specified in 
this Section; provided that notices to the Agent under Article 2 or Article 8 
shall not be effective until received.

Section 10.02. No Waivers. No failure or delay by the Agent or any Bank in 
exercising any right, power or privilege hereunder or under any Note shall 
operate as a waiver thereof nor shall any single or partial exercise thereof 
preclude any other or further exercise thereof or the exercise of any other 
right, power or privilege.  The rights and remedies herein provided shall be 
cumulative and not exclusive of any rights or remedies provided by law.

Section 10.03. Expenses; Indemnification. (a) The Company shall pay (i) all 
out-of-pocket expenses of the Agent, including fees and disbursements of 
special counsel for the Agent, in connection with the preparation and 
administration of this Agreement, any waiver or consent hereunder or any 
amendment hereof or any Default or alleged Default hereunder and (ii) if an 
Event of Default occurs, all out-of-pocket expenses incurred by the Agent and 
each Bank, including fees and disbursements of counsel, in connection with 
such Event of Default and collection, bankruptcy, insolvency and other 
enforcement proceedings resulting therefrom.  

(b)  The Company agrees to indemnify the Agent and each Bank, their 
respective affiliates and the respective directors, officers, agents and 
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee 
harmless from and against any and all liabilities, losses, damages, costs and 
expenses of any kind, including, without limitation, the reasonable fees and 
disbursements of 

                                     52

<PAGE>

counsel, which may be incurred by such Indemnitee in connection with any 
investigative, administrative or judicial proceeding (whether or not such 
Indemnitee shall be designated a party thereto) brought or threatened 
relating to or arising out of this Agreement or any actual or proposed use of 
proceeds of Loans hereunder; provided that (i) no Indemnitee shall have the 
right to be indemnified hereunder for such Indemnitee's own gross negligence 
or willful misconduct as determined by a court of competent jurisdiction and 
(ii) the Company shall not be liable for any settlement entered into by an 
Indemnitee without its consent (which shall not be unreasonably withheld).

(c)  Each Indemnitee agrees to give the Company prompt written notice after 
it receives any notice of the commencement of any action, suit or proceeding 
for which such Indemnitee may wish to claim indemnification pursuant to 
subsection (b).  The Company shall have the right, exercisable by giving 
written notice within fifteen Domestic Business Days after the receipt of 
notice from such Indemnitee of such commencement, to assume, at the Company's 
expense, the defense of any such action, suit or proceeding; provided, that 
such Indemnitee shall have the right to employ separate counsel in any such 
action, suit or proceeding and to participate in the defense thereof, but the 
fees and expenses of such separate counsel shall be at such Indemnitee's 
expense unless (1) the Company shall have agreed to pay such fees and 
expenses; (2) the Company shall have failed to assume the defense of such 
action, suit or proceeding or shall have failed to employ counsel reasonably 
satisfactory to such Indemnitee in any such action, suit or proceeding; or 
(3) such Indemnitee shall have been advised by independent counsel in writing 
(with a copy to the Company) that there may be one or more defenses available 
to such Indemnitee which are in conflict with those available to the Company 
(in which case, if such Indemnitee notifies the Company in writing that it 
elects to employ separate counsel at the Company's expense, the Company shall 
be obligated to assume the expense, it being understood, however, that the 
Company shall not be liable for the fees or expenses of more than one 
separate firm of attorneys, which firm shall be designated in writing by such 
Indemnitee).

Section 10.04. Sharing of Set-offs. Each Bank agrees that if it shall, by 
exercising any right of set-off or counterclaim or otherwise, receive payment 
of a proportion of the aggregate amount of principal and interest due with 
respect to any Note held by it which is greater than the proportion received 
by any other Bank in respect of the aggregate amount of principal and 
interest due with respect to any Note held by such other Bank, the Bank 
receiving such proportionately greater payment shall purchase such 
participations in the Notes held by the other Banks, and such other 
adjustments shall be made, as may be required so that all such payments of 
principal and interest with respect to the Notes held by the 

                                      53

<PAGE>

Banks shall be shared by the Banks pro rata; provided that nothing in this 
Section shall impair the right of any Bank to exercise any right of set-off 
or counterclaim it may have and to apply the amount subject to such exercise 
to the payment of indebtedness of the Borrower other than its indebtedness 
hereunder.   The Borrower agrees, to the fullest extent it may effectively do 
so under applicable law, that any holder of a participation in a Note, 
whether or not acquired pursuant to the foregoing arrangements, may exercise 
rights of set-off or counterclaim and other rights with respect to such 
participation as fully as if such holder of a participation were a direct 
creditor of the Borrower in the amount of such participation.

Section 10.05. Amendments and Waivers. Any provision of this Agreement or the 
Notes may be amended or waived if, but only if, such amendment or waiver is 
in writing and is signed by the Company, the Borrower and the Required Banks 
(and, if the rights or duties of the Agent are affected thereby, by the 
Agent); provided that no such amendment or waiver shall, unless signed by all 
the Banks, (i) increase or decrease the Commitment of any Bank (except for a 
ratable decrease in the Commitments of all Banks) or subject any Bank to any 
additional obligation, (ii) reduce the principal of or rate of interest on 
any Loan or any fees hereunder, except as provided below, (iii) postpone the 
date fixed for any payment of principal of or interest on any Loan or any 
fees hereunder or for any reduction or termination of any Commitment, (iv) 
amend or waive the provisions of Article 9 or (v) change the percentage of 
the Commitments or of the aggregate unpaid principal amount of the Notes, or 
the number of Banks, which shall be required for the Banks or any of them to 
take any action under this Section or any other provision of this Agreement.

Section 10.06. Successors and Assigns. (a)  The provisions of this Agreement 
shall be binding upon and inure to the benefit of the parties hereto and 
their respective successors and assigns, except that neither the Company nor 
the Borrower may assign or otherwise transfer any of its rights under this 
Agreement without the prior written consent of all Banks.

(b)  Any Bank may at any time grant to one or more banks or other 
institutions (each a "Participant") participating interests in its Commitment 
or any or all of its Loans, with (and subject to) the written consent of the 
Company and the Agent, which consents shall not be unreasonably withheld.  In 
the event of any such grant by a Bank of a participating interest to a 
Participant, such Bank shall remain responsible for the performance of its 
obligations hereunder, and the Company, the Borrower and the Agent shall 
continue to deal solely and directly with such Bank in connection with such 
Bank's rights and obligations under this Agreement.  Any agreement pursuant 
to which any Bank may grant such a 

                                      54

<PAGE>

participating interest shall provide that such Bank shall retain the sole 
right and responsibility to enforce the obligations of the Company and the 
Borrower hereunder including, without limitation, the right to approve any 
amendment, modification or waiver of any provision of this Agreement; 
provided that such participation agreement may provide that such Bank will 
not agree to any modification, amendment or waiver of this Agreement 
described in clause (i), (ii) or (iii) of Section 10.05 without the consent 
of the Participant.  The Borrower agrees that each Participant shall, to the 
extent provided in its participation agreement, be entitled to the benefits 
of  Article 8 with respect to its participating interest.  An assignment or 
other transfer which is not permitted by subsection (c) or (d) below but 
which is consented to in accordance with this subsection (b) shall be given 
effect for purposes of this Agreement only to the extent of a participating 
interest granted in accordance with this subsection (b).

     (c)  Any Bank may at any time assign to one or more banks or other 
institutions (each an "Assignee") all, or a proportionate part of all, of its 
rights and obligations under this Agreement and the Notes, and such Assignee 
shall assume such rights and obligations, pursuant to an Assignment and 
Assumption Agreement in substantially the form of Exhibit G hereto executed 
by such Assignee and such transferor Bank, with (and subject to) the 
subscribed consent of the Company and the Agent, which consents shall not be 
unreasonably withheld; provided that (i) if an Assignee is an affiliate of 
such transferor Bank, no such consent shall be required; (ii) such assignment 
may, but need not, include rights of the transferor Bank in respect of 
outstanding Money Market Loans; and (iii) any assignment shall not be less 
than $15,000,000, or if less, shall constitute an assignment of all of such 
Bank's rights and obligations under this Agreement and the Notes except for 
any rights retained in accordance with clause (ii) of this proviso.  Upon 
execution and delivery of such instrument and payment by such Assignee to 
such transferor Bank of an amount equal to the purchase price agreed between 
such transferor Bank and such Assignee, such Assignee shall be a Bank party 
to this Agreement and shall have all the rights and obligations of a Bank 
with a Commitment as set forth in such instrument of assumption, and the 
transferor Bank shall be released from its obligations hereunder to a 
corresponding extent, and no further consent or action by any party shall be 
required.  Upon the consummation of any assignment pursuant to this 
subsection (c), the transferor Bank, the Agent and the Borrower shall make 
appropriate arrangements so that, if required, new Notes are issued to the 
Assignee.  In connection with any such assignment, the transferor Bank shall 
pay to the Agent an administrative fee for processing such assignment in the 
amount of $2,500.  If the Assignee is not incorporated under the laws of the 
United States of America or a state thereof, it shall deliver to the Company 
and the Agent certification as to

                                       55

<PAGE>

exemption from deduction or withholding of any United States federal income 
taxes in accordance with Section 8.04.

     (d)  Any Bank may at any time assign all or any portion of its rights 
under this Agreement and its Notes to a Federal Reserve Bank.  No such 
assignment shall release the transferor Bank from its obligations hereunder. 

     (e)  No Assignee, Participant or other transferee of any Bank's rights 
shall be entitled to receive any greater payment under Section 8.03 or 8.04 
than such Bank would have been entitled to receive with respect to the rights 
transferred, unless such transfer is made with the Company's prior written 
consent or by reason of the provisions of Section 8.02, 8.03 or 8.04 
requiring such Bank to designate a different Applicable Lending Office under 
certain circumstances or at a time when the circumstances giving rise to such 
greater payment did not exist.

     Section 10.07. Termination of Existing Credit Agreements. The 
Company and each of the Banks that is also a "Bank" party to the Existing 
Credit Agreements agrees that the "Commitments" as defined in the Existing 
Credit Agreements shall be terminated in their entirety on the Effective 
Date.  Each of such Banks waives (a) any requirement of notice of such 
termination pursuant to Section 2.09 of the Existing Credit Agreements and 
(b) any claim to any facility fees or other fees under the Existing Credit 
Agreements for any day on or after the Effective Date.  Each of the Company 
and the Borrower (i) represents and warrants that (x) after giving effect to 
the preceding sentences of this Section 10.07, the commitments under the 
Existing Credit Agreements will be terminated effective not later than the 
Effective Date, (y) no loans are, as of the date hereof, or will be, as of 
the Effective Date, outstanding under the Existing Credit Agreements and (ii) 
covenants that all accrued and unpaid facility fees and any other amounts due 
and payable under the Existing Credit Agreements shall have been paid on or 
prior to the Effective Date.

     Section 10.08. Governing Law; Submission to Jurisdiction. This 
Agreement and each Note shall be governed by and construed in accordance with 
the laws of the State of New York.  Each of the Company and the Borrower 
hereby submits to the nonexclusive jurisdiction of the United States District 
Court for the Southern District of New York and of any New York State court 
sitting in New York City for purposes of all legal proceedings arising out of 
or relating to this Agreement or the transactions contemplated hereby, and 
irrevocably waives, to the fullest extent permitted by law, any objection 
which it may now or hereafter have to the laying of the venue of any such 
proceeding brought in such a court and any claim that any such proceeding 
brought in such a court has been brought in an inconvenient forum. 

                                       56

<PAGE>

     Section 10.09. Counterparts; Integration; Effectiveness. This Agreement 
may be signed in any number of counterparts, each of which shall be an 
original, with the same effect as if the signatures thereto and hereto were 
upon the same instrument.  This Agreement constitutes the entire agreement 
and understanding among the parties hereto and supersedes any and all prior 
agreements and understandings, oral or written, relating to the subject 
matter hereof.  This Agreement shall become effective upon receipt by the 
Agent of counterparts hereof signed by each of the Company, the Borrower, the 
Banks and the Agent (or, in the case of any party as to which an executed 
counterpart shall not have been received, receipt by the Agent in form 
satisfactory to it of telegraphic, telex or other written confirmation from 
such party of execution of a counterpart hereof by such party).

     Section 10.10. WAIVER OF JURY TRIAL. EACH OF THE COMPANY, THE BORROWER, 
THE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL 
BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT 
OR THE TRANSACTIONS CONTEMPLATED HEREBY.

     Section 10.11. Confidentiality. Each of the Agent and the Banks agrees 
to use its reasonable best efforts to keep confidential any information 
delivered or made available by the Company or the Borrower to it which is 
clearly stated by the Company or the Borrower to be confidential; provided 
that nothing herein shall prevent the Agent or any Bank from disclosing such 
information (i) to the Agent or any other Bank in connection with the 
transactions contemplated hereby, (ii) to its officers, directors, employees, 
agents, attorneys and accountants who have a need to know such information in 
accordance with customary banking practices and who receive such information 
having been made aware of the restrictions set forth in this Section, (iii) 
upon the order of any court or administrative agency, (iv) upon the request 
or demand of any regulatory agency or authority having jurisdiction over such 
party, (v) which has been publicly disclosed, (vi) which has been obtained 
from any Person other than the Company and its Subsidiaries, provided that 
such Person is not (x) known to it to be bound by a confidentiality agreement 
with the Company or its Subsidiaries or (y) known to it to be otherwise 
prohibited from transmitting the information to it by a contractual, legal or 
fiduciary obligation, (vii) in connection with the exercise of any remedy 
hereunder or under the Notes or (viii) to any actual or proposed participant 
or assignee of all or any of its rights hereunder which has agreed in writing 
to be bound by the provisions of this Section.

                                       57

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be 
duly executed by their respective authorized officers as of the day and year 
first above written.

                                               U S WEST CAPITAL FUNDING, INC.


                                               By /s/ Rahn K. Porter 
                                                 -----------------------------
                                                 Title: Executive Director
                                                        Treasury Services
                                                 7800 East Orchard Road
                                                 Englewood, Colorado  80111
                                                 Facsimile number:  303-793-6307
                                                 Telephone number:  303-793-6250
                                                 Attention:  Rahn Porter


                                                 U S WEST, INC.


                                               By /s/ James T. Anderson 
                                                 -----------------------------
                                                 Title: Vice President
                                                        & Treasurer
                                                 7800 East Orchard Road
                                                 Englewood, Colorado  80111
                                                 Facsimile number: 303-793-6307
                                                 Telephone number: 303-793-6250
                                                 Attention:  Rahn Porter 

                                       58

<PAGE>

Commitments
-----------

$140,000,000              MORGAN GUARANTY TRUST
                           COMPANY OF NEW YORK


                          By /s/ George J. Stapleton
                            ------------------------
                            Title: Vice President



$ 140,000,000             CITIBANK, N.A. 


                          By /s/ Carolyn A. Kee
                            ------------------------
                            Title: Vice President



$ 140,000,000             THE BANK OF NEW YORK


                          By /s/ Kalpana Raina
                            ------------------------
                            Title: Senior Vice President



$ 100,000,000             ABN AMRO BANK N.V.


                          By /s/ James J. Johnston
                            ------------------------
                            Title: Vice President

                          By /s/ Mary L. Honda 
                            ------------------------
                            Title: Vice President


                                       59

<PAGE>
 

$ 37,500,000              BANK OF AMERICA NW, N.A. dba
                           SEAFIRST

                          By /s/ Barbara W. Trimble
                            --------------------------                   
                            Title: Vice President 



$ 62,500,000              BANK OF AMERICA NT & SA 


                          By /s/ Raymond E. Evans
                            --------------------------
                            Title: Senior Vice President
                                   Manager Commercial Building



$100,000,000              BARCLAYS BANK PLC

                          By /s/ Les Bek
                            ---------------------------
                            Title: Director



$ 100,000,000             CANADIAN IMPERIAL BANK OF
                           COMMERCE 


                          By /s/ Matthew S. Hannon 
                            ---------------------------
                            Title: Director, CIBC Wood Gundy
                                    Securities acting, as Agent


$100,000,000              THE CHASE MANHATTAN BANK


                          By /s/ Ann B. Kerns     
                            --------------------------- 
                            Title: Vice President

                                     60

<PAGE>

$100,000,000              DEUTSCHE BANK AG
                            NEW YORK AND/OR CAYMAN
                            ISLANDS BRANCHES


                          By /s/ Ross A. Howard        
                            ---------------------------
                            Title: Director


                          By /s/ J. Scott Jessup       
                            ---------------------------
                            Title: Vice President


$100,000,000              THE FIRST NATIONAL BANK OF
                            BOSTON


                          By /s/ Shepard D. Rainie     
                            ---------------------------
                            Title: Director


$100,000,000              MELLON BANK N.A.


                          By /s/ Stephen R. Viehe     
                            ---------------------------
                            Title: Vice President


$ 100,000,000             THE SANWA BANK LIMITED,
                            CHICAGO BRANCH


                          By /s/ Kenneth C. Eichwald   
                            ---------------------------
                            Title: First Vice President and Assistant
                                     General Manager

                                     61

<PAGE>

$ 100,000,000             SWISS BANK CORPORATION,
                            SAN FRANCISCO BRANCH


                          By /s/ Hans-Uoli Surber    
                            -------------------------
                            Title: Executive Director Merchant 
                                      Banking


                          By /s/ Nang S. Peechaphand 
                            -------------------------
                            Title: Associate Director Accounting


$ 100,000,000             TORONTO-DOMINION BANK
                            (TEXAS), INC.


                          By /s/ Frederic B. Hawley  
                            -------------------------
                            Title: Vice President


$ 70,000,000              BANQUE NATIONALE DE PARIS


                          By /s/ Clive Bettles      
                            ------------------------
                            Title: Senior Vice President & Manager
             

                          By /s/ Mitchell M. Ozawa  
                            ------------------------
                            Title: Vice President


$ 70,000,000              BANQUE PARIBAS


                          By /s/ John Acker         
                            ------------------------
                            Title: Group Vice President

                                     62

<PAGE>

                          By /s/ Darlynn Ernst     
                            -----------------------
                            Title: Assistant Vice President


$ 70,000,000              CREDIT SUISSE


                          By /s/ Stephen M. Flynn  
                            -----------------------
                            Title: Member of Senior Management


                          By /s/ Maria N. Gaspara  
                            -----------------------
                            Title: Associate


$ 70,000,000              THE DAI-ICHI KANGYO BANK,
                            LIMITED


                          By /s/ Teruhisa Yamaguchi
                            -----------------------
                            Title: Senior Vice President & Joint
                                     General Manager
                  

$ 70,000,000              THE FIRST NATIONAL BANK OF
                            CHICAGO


                          By /s/ Ronald L. Coleman 
                            ------------------------
                            Title: Vice President


$ 70,000,000              THE FUJI BANK LIMITED 
                            LOS ANGELES AGENCY

                                     63

<PAGE>

                          By /s/ Nobuhiro Umemura  
                            -----------------------
                            Title: Joint General Manager


$ 70,000,000              THE INDUSTRIAL BANK OF JAPAN,
                            LTD. NEW YORK BRANCH


                          By /s/ Akijiro Yoshino   
                            -----------------------
                            Title: Executive Vice President,
                                     Houston Office


$ 70,000,000              NATIONSBANK OF TEXAS, N.A.


                          By /s/ David G. James    
                            -----------------------
                            Title: Vice President


$ 70,000,000              ROYAL BANK OF CANADA


                          By /s/ John P. Page      
                            -----------------------
                            Title: Senior Manager


$ 70,000,000              THE SAKURA BANK LIMITED


                          By /s/ Ofusa Sato        
                            -----------------------
                            Title: Senior Vice President & Assistant
                                     General Manager
     
                                     64

<PAGE>

$ 70,000,000              THE SUMITOMO BANK, LIMITED
                            LOS ANGELES BRANCH

                          By /s/ Goro Hirai        
                            -----------------------
                            Title: Joint General Manager


$ 70,000,000              UNION BANK OF CALIFORNIA, N.A.


                          By /s/ Roger Hartley     
                            -----------------------
                            Title: Vice President


$ 70,000,000              WELLS FARGO BANK (COLORADO),
                            N.A.


                          By /s/ Jack W. Haye      
                            -----------------------
                            Title: Vice President


$ 47,500,000              BANK OF MONTREAL


                          By /s/ Yvonne Bos       
                            ----------------------
                            Title: Senior Vice President


$ 47,500,000              CREDIT LYONNAIS 
                            NEW YORK BRANCH


                          By /s/ James E. Morris  
                            -----------------------
                            Title: Vice President

                                     65

<PAGE>

$ 47,500,000              DRESDNER BANK AG, NEW YORK
                            AND GRAND CAYMAN BRANCHES


                          By /s/ William E. Lambert  
                            --------------------------
                            Title: Assistant Vice President

                          By /s/ Brian Haughney       
                            --------------------------
                            Title: Assistant Treasurer


$ 47,500,000              BAYERISCHE HYPO-BANK AG, 
                            NEW YORK BRANCH


                          By /s/ Yoram Dankner        
                            --------------------------
                            Title: Senior Vice President

                          By /s/ Christian F. Walter  
                            --------------------------
                            Title: Vice President


$ 47,500,000              KREDIETBANK N.A.


                          By /s/ Tod R. Angus         
                            --------------------------
                            Title: Vice President

                          By /s/ Robert Snauffer      
                            --------------------------
                            Title: Vice President


$ 47,500,000              LLOYDS BANK PLC

                                     66

<PAGE>

                          By /s/ Paul Briamonte       
                            --------------------------
                            Title: Vice President B374

                          By /s/ Theodore R. Walser   
                            --------------------------
                            Title: Senior Vice President W075

          
$ 47,500,000              THE LONG-TERM CREDIT BANK OF
                            JAPAN, LTD. 
                            LOS ANGELES AGENCY


                          By /s/ T. Morgan Edwards II 
                            --------------------------
                            Title: Deputy General Manager


$ 47,500,000              THE MITSUBISHI TRUST AND
                            BANKING CORPORATION


                          By /s/ Patricia Loret de Mola
                            ----------------------------
                            Title: Senior Vice President & Assistant
                                     General Manager


$ 47,500,000              THE ROYAL BANK OF SCOTLAND plc


                          By /s/ Grant F. Stoddart    
                            --------------------------
                            Title: Senior Vice President & Manager
     

$ 47,500,000              SOCIETE GENERALE 
          

                                     67

<PAGE>

                            SOUTHWEST AGENCY


                          By /s/ Mark A. Cox          
                            --------------------------
                            Title: Vice President


$ 47,500,000              THE TOKAI BANK, LIMITED 
                            LOS ANGELES AGENCY


                          By /s/ Masahiko Saito       
                            --------------------------
                            Title: Assistant General Manager
                                     Corporate Finance


$ 47,500,000              WESTDEUTSCHE LANDESBANK
                            NEW YORK BRANCH


                          By /s/ Salvatore Battinelli 
                            --------------------------
                            Title: Vice President

                          By /s/ Karen Hoplock        
                            --------------------------
                            Title: Vice President Credit


Total Commitments:

$3,000,000,000
--------------
--------------

                                     68

<PAGE>

                         CITIBANK, N.A., as Syndication Agent


                         By /s/ Carolyn A. Kee        
                           ---------------------------
                           Title: As-Attorney-in -Fact


                         THE BANK OF NEW YORK, as
                           Documentation Agent


                         By /s/ Kalpana Raina         
                           ---------------------------
                           Title: Senior Vice President


                         MORGAN GUARANTY TRUST
                           COMPANY OF NEW YORK, as 
                           Administrative Agent


                         By /s/ George J. Stapleton   
                           ---------------------------
                           Title: Vice President
                           Address
                           Attention:  Mark Connor      
                           Facsimile number:  302-634-1092
                           Telephone number:  302-634-4218


                                     69

<PAGE>
 
                                   PRICING SCHEDULE


     The "Euro-Dollar Margin" and "Facility Fee Rate" for any day are the 
respective percentages set forth below in the applicable row under the column 
corresponding to the Status that exists on such day:

________________________________________________________________________________
                     Level         Level      Level      Level      Level 
Status                 I            II         III        IV           V
________________________________________________________________________________
Euro-Dollar Margin   .150%          .175%      .200%      .290%      .350%
________________________________________________________________________________
Facility Fee Rate    .050%          .050%      .050%      .060%      .100%
________________________________________________________________________________

     For purposes of this Schedule, the following terms have the following 
meanings:

     "Level I Status" exists at any date if, at such date, the Borrower's 
outstanding senior unsecured long-term debt securities are rated A or higher 
by S&P or A2 or higher by Moody's.

     "Level II Status" exists at any date if, at such date, (i) the 
Borrower's outstanding senior unsecured long-term debt securities are rated 
A- or higher by S&P or A3 or higher by Moody's and (ii) Level I Status does 
not exist.

     "Level III Status" exists at any date if, at such date, (i) the 
Borrower's outstanding senior unsecured long-term debt securities are rated 
BBB+ or higher by S&P or  Baa1 or higher by Moody's and (ii) neither Level I 
Status nor Level II Status exists.

     "Level IV Status" exists at any date if, at such date, (i) the 
Borrower's outstanding senior unsecured long-term debt securities are rated 
BBB or higher by S&P or Baa2 or higher by Moody's and none of Level I Status, 
Level II Status or  Level III Status exists.

     "Level V Status" exists at any date if, at such date, none of Level I 
Status, Level II Status, Level III Status or Level IV Status exists.

     "Moody's" means Moody's Investors Service, Inc., a Delaware corporation, 
and its successors or, if such corporation shall be dissolved or liquidated 
or shall no longer perform the functions of a securities rating agency, 
"Moody's" shall be deemed to refer to any other nationally recognized 
securities rating agency designated by the Required Banks, with the approval 
of the Company, by notice to the Agent and the Company.

     "S&P" means Standard & Poor's Ratings Group, a New York corporation, and 
its successors or, if such corporation shall be dissolved or liquidated or 
shall no longer perform the functions of a securities rating agency, "S&P" 
shall be deemed to refer to any other nationally recognized securities rating 
agency designated by the Required Banks, with the approval of the Company, by 
notice to the Agent and the Company.

     "Status" refers to the determination of which of Level I Status, Level 
II Status, Level III Status, Level IV Status or Level V Status exists at any 
date.

The credit ratings to be utilized for purposes of this Schedule are those 
assigned to the senior unsecured long-term debt securities of the Borrower 
without third-party credit enhancement, and any rating assigned to any other 
debt security of the Borrower shall be disregarded.  The rating in effect at 
any date is that in effect at the close of business on such date.

                                      2

<PAGE>

 
                                    SCHEDULE 4.07

                                Environmental Matters

NONE.

 

<PAGE>


                                                                       EXHIBIT A

                                         NOTE

                                                              New York, New York

                                                                           ,19  

     For value received, U S WEST CAPITAL FUNDING, INC., a Colorado 
corporation (the "Borrower"), promises to pay to the order of (the "Bank"), 
for the account of its Applicable Lending Office, the unpaid principal amount 
of each Loan made by the Bank to the Borrower pursuant to the Credit 
Agreement referred to below on the maturity date therefor specified in the 
Credit Agreement. The Borrower promises to pay interest on the unpaid 
principal amount of each such Loan on the dates and at the rate or rates 
provided for in the Credit Agreement.  All such payments of principal and 
interest shall be made in lawful money of the United States in Federal or 
other immediately available funds at the office of Morgan Guaranty Trust 
Company of New York, 60 Wall Street, New York, New York.

     All Loans made by the Bank, the respective types and maturities thereof 
and all repayments of the principal thereof shall be recorded by the Bank 
and, if the Bank so elects in connection with any transfer or enforcement 
hereof, appropriate notations to evidence the foregoing information with 
respect to each such Loan then outstanding may be endorsed by the Bank on the 
schedule attached hereto, or on a continuation of such schedule attached to 
and made a part hereof; provided that the inaccuracy of, or the failure of 
the Bank to make, any such recordation or endorsement shall not affect the 
obligations of the Borrower hereunder or under the Credit Agreement.

     This note is one of the Notes referred to in the 364-Day Credit 
Agreement dated as of November 1, 1996  among U S WEST Capital Funding, Inc., 
U S WEST, Inc., the banks listed on the signature pages thereof, the other 
agents named therein and Morgan Guaranty Trust Company of New York, as 
Administrative Agent (as the same may be amended from time to time, the 
"Credit Agreement").  Terms defined in the Credit Agreement are used herein 
with the same meanings.

     Reference is made to the Credit Agreement for provisions for the 
prepayment hereof and the acceleration of the maturity hereof.


<PAGE>

     U S WEST, Inc., has, pursuant to the provisions of the Credit Agreement, 
unconditionally guaranteed the payment in full of the principal of and 
interest on this Note.

                                       U S WEST CAPITAL FUNDING, INC.

                                       By                            
                                         ----------------------------
                                         Title:


                                      2


<PAGE>


                            LOANS AND PAYMENTS OF PRINCIPAL


________________________________________________________________________________

                                       Amount of 
         Amount of                     Principal                   Notation Made
Date       Loan      Type of Loan       Repaid     Maturity Date          By
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

                                      3


<PAGE>


                                                                       EXHIBIT B


                          Form of Money Market Quote Request


                                                         [Date]



To:  Morgan Guaranty Trust Company of New York
     (the "Agent")

From:  U S WEST Capital Funding, Inc.

Re:  364-Day Credit Agreement (the "Credit Agreement") dated as of November 1,
     1996 among U S WEST Capital Funding, Inc., U S WEST, Inc., the Banks listed
     on the signature pages thereof, the other agents named therein and the
     Agent

     We hereby give notice pursuant to Section 2.03 of the Credit Agreement that
we request Money Market Quotes for the following proposed Money Market
Borrowing(s):

Date of Borrowing:  __________________

Principal Amount**              Interest Period***
------------------              ------------------

$

  Such Money Market Quotes should offer a Money Market [Margin] 
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.] Terms used herein have the meanings assigned to them in the Credit
Agreement.


____________________

     **Amount must be $25,000,000 or a larger multiple of
$5,000,000.
     ***Not less than one month (LIBOR Auction) or not less than 7 days
(Absolute Rate Auction), subject to the provisions of the definition of Interest
Period.


<PAGE>

     Terms used herein have the meanings assigned to them in the Credit 
Agreement.

                                        U S WEST CAPITAL FUNDING, INC.


                                        By________________________
                                          Title:


                                      2


<PAGE>

                                                                       EXHIBIT C


                      Form of Invitation for Money Market Quotes
                                                                


To:       [Name of Bank]

Re:       Invitation for Money Market Quotes to U S WEST Capital Funding, Inc.
          (the "Borrower")

          Pursuant to Section 2.03 of the 364-Day Credit Agreement dated as 
of November 1, 1996 among U S WEST Capital Funding, Inc., U S WEST, Inc., the 
Banks parties thereto, the other agents named therein and the undersigned, as 
Administrative Agent, we are pleased on behalf of the Borrower to invite you 
to submit Money Market Quotes to the Borrower for the following proposed 
Money Market Borrowing(s):

Date of Borrowing:  __________________

Principal Amount              Interest Period
----------------              ---------------

$

     Such Money Market Quotes should offer a Money Market [Margin] 
[Absolute Rate]. [The applicable base rate is the London Interbank 
Offered Rate.] Please respond to this invitation by no later than 
[10:30 A.M.] [9:15 A.M.] (New York City time) on [date].

                                MORGAN GUARANTY TRUST COMPANY
                                  OF NEW YORK, as Administrative Agent


                                By______________________________
                                  Authorized Officer 


<PAGE>


                                                                       EXHIBIT D


                              Form of Money Market Quote


To:       Morgan Guaranty Trust Company of New York,
          as Administrative Agent (the "Agent")

Re:       Money Market Quote to
          U S WEST Capital Funding, Inc. (the "Borrower")

     In response to your invitation on behalf of the Borrower dated 
_____________, 19__, we hereby make the following Money Market Quote on the 
following terms: 

1.        Quoting Bank:  ________________________________

2.        Person to contact at Quoting Bank:   _____________________________

3.        Date of Borrowing: ____________________*

4.        We hereby offer to make Money Market Loan(s) in the following
          principal amounts, for the following Interest Periods and at the
          following rates:


Principal             Interest        Money Market
 Amount**             Period***       [Margin****]          [Absolute Rate*****]
---------             ---------       -------------         --------------------

$

$

  [Provided, that the aggregate principal amount of Money Market Loans for which
  the above offers may be accepted shall not exceed $____________.]**


__________
* As specified in the related Invitation.


  (notes continued on following page)


<PAGE>

     We understand and agree that the offer(s) set forth above, subject to 
the satisfaction of the applicable conditions set forth in the 364-Day Credit 
Agreement dated as of November 1, 1996 among U S WEST Capital Funding, Inc., 
U S WEST, Inc., the Banks listed on the signature pages thereof, the other 
agents named therein and yourselves, as Agent, irrevocably obligates us to 
make the Money Market Loan(s) for which any offer(s) are accepted, in whole 
or in part.

                                        Very truly yours,
                                        [NAME OF BANK]


Dated:_______________                   By:__________________________
                                           Authorized Officer




__________

** Principal amount bid for each Interest Period may not exceed principal 
amount requested.  Specify aggregate limitation if the sum of the individual 
offers exceeds the amount the Bank is willing to lend.  Bids must be made for 
$5,000,000 or a larger multiple of $1,000,000.
*** Not less than one month or not less than 7 days, as specified in the 
related Invitation.  No more than five bids are permitted for each Interest 
Period.
**** Margin over or under the London Interbank Offered Rate determined for 
the applicable Interest Period.  Specify percentage (to the nearest 1/10,000 
of 1%) and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).  

                                      2


<PAGE>

                                                                       EXHIBIT E


                                      OPINION OF
                       COUNSEL FOR THE COMPANY AND THE BORROWER
                                           

To the Banks and the Administrative 
  Agent Referred to Below
c/o Morgan Guaranty Trust Company
  of New York, as Administrative Agent
60 Wall Street
New York, New York  10260

Gentlemen and Ladies:

     I have acted as counsel for U S WEST, Inc. and U S WEST Capital Funding, 
Inc., in connection with the 364-Day Credit Agreement (the "Credit 
Agreement") dated as of November 1, 1996, among them, the banks listed on the 
signature pages thereof, the other agents named therein and Morgan Guaranty 
Trust Company of New York, as Administrative Agent.  Terms defined in the 
Credit Agreement are used herein as therein defined.  This opinion is being 
rendered to you at the instruction of the client pursuant to Section 3.01(b) 
of the Credit Agreement.

     I am familiar with the proceedings taken by the Company and the Borrower 
in connection with the authorization, execution and delivery of the Credit 
Agreement and the Notes, and I have examined such documents, certificates, 
and such other matters of fact and questions of law as I have deemed relevant 
under the circumstances to express an informed opinion.  Upon the basis of 
the foregoing, I am of the opinion that:

     1.  The Company is a corporation duly incorporated, validly existing and 
in good standing under the laws of the State of Delaware, and has all 
corporate powers and all governmental licenses, authorizations, 
qualifications, consents and approvals required to carry on its business as 
now conducted, except where the absence of any such license, authorization, 
qualification, consent or approval would not have a material adverse effect 
on the consolidated financial position or consolidated results of operations 
of the Company and its Consolidated Subsidiaries considered as one enterprise.



<PAGE>


     2.  The execution, delivery and performance by the Company and the 
Borrower of the Credit Agreement and by the Borrower of the Notes are within 
such Person's corporate powers, have been duly authorized by all necessary 
corporate action, and require no action by or in respect of, or filing with, 
any governmental body, agency or official.

     3.  The execution, delivery and performance by the Company and the 
Borrower of the Credit Agreement and by the Borrower of the Notes will not 
(i) result in a breach or violation of, conflict with, or constitute a 
default under, the articles of incorporation or bylaws of such Person or any 
material law or regulation or any material order, judgment, agreement or 
instrument to which such Person is a party or by which such Person is bound, 
or (ii) result in the creation or imposition of any Lien on any asset of such 
Person.

     4.  The Credit Agreement constitutes a valid and binding agreement of 
the Company and the Borrower and the Notes constitute valid and binding 
obligations of the Borrower.

     5.  To my knowledge, there is no action, suit or proceeding pending 
against or threatened against or affecting the Company or any of its 
Subsidiaries before any court or arbitrator or any governmental body, agency 
or official, in which there is a reasonable possibility of an adverse 
decision which could materially adversely affect the business, consolidated 
financial position or consolidated results of operations of the Company and 
its Consolidated Subsidiaries, considered as a whole, or which in any manner 
draws into question the validity of the Credit Agreement or the Notes.

     6.  The Borrower and each of the Company's other corporate Significant 
Subsidiaries is a corporation validly existing and in good standing under the 
laws of their jurisdictions of incorporation, and have all corporate powers 
and all governmental licenses, authorizations, qualifications, consents and 
approvals required to carry on its business as now conducted, except where 
the absence of any such license, authorization, qualification, consent or 
approval would not have a material adverse effect on the consolidated 
financial position or consolidated results of operations of the Company and 
its Consolidated Subsidiaries considered as one enterprise.

     For purposes of my opinion set forth in numbered paragraph 4 above, I 
have assumed that the laws of the State of New York, which are stated to 
govern the Credit Agreement and the Notes, are the same as the laws of 
Colorado.

                                      2


<PAGE>

     In rendering the opinions set forth herein, I have assumed that the 
Credit Agreement and the Notes will conform to the specimens thereof examined 
by me, that the signatures on all documents examined by me were genuine, and 
the authenticity of all documents submitted to me as originals or as copies 
of originals, assumptions which I have not independently verified.

     This opinion is furnished by me as counsel for the Company and the 
Borrower and is solely for your benefit and the benefit of any Assignee under 
the Credit Agreement.  Without my prior written consent, this opinion may not 
be relied upon by you or any Assignee in any other context or by any other 
person.  This opinion may not be quoted, in whole or in part, or copies 
thereof furnished, to any other person without my prior written consent, 
except that you may furnish copies hereof (a) to your auditors and attorneys, 
(b) to any state or federal authority having regulatory jurisdiction over you 
or the Company or the Borrower, (c) pursuant to order or legal process of any 
court or governmental agency, (d) in connection with any legal action to 
which you are a party arising out of the transactions contemplated by the 
Credit Agreement, and (e) to any Participant or proposed Participant in the 
Commitment of any Bank.

     This opinion is limited to the present laws of the State of Colorado and 
the General Corporation Law of the State of Delaware, to present judicial 
interpretations thereof, and to the facts as they presently exist, and I 
assume no responsibility as to the applicability or effect of the laws of any 
other jurisdiction.  In rendering this opinion, I assume no obligation to 
revise or supplement this opinion should the present laws of the State of 
Colorado or the General Corporation Law of the State of Delaware be changed 
by legislative action, judicial decision, or otherwise.

                                     Very truly yours,


                                     Stephen E. Brilz

                                      3


<PAGE>
 
                                                                       EXHIBIT F


                                      OPINION OF
                       DAVIS POLK & WARDWELL, SPECIAL COUNSEL 
                             FOR THE ADMINISTRATIVE AGENT
                                           



To the Banks and the Administrative Agent
  Referred to Below
c/o Morgan Guaranty Trust Company
  of New York, as Administrative Agent
60 Wall Street
New York, New York  10260

Dear Sirs:

     We have participated in the preparation of the 364-Day Credit Agreement 
(the "Credit Agreement") dated as of November 1, 1996 among U S WEST Capital 
Funding, Inc., U S WEST, Inc., the banks listed on the signature pages 
thereof (the "Banks"), the other agents named therein and Morgan Guaranty 
Trust Company of New York, as Administrative Agent (the "Agent"), and have 
acted as special counsel for the Agent for the purpose of rendering this 
opinion pursuant to Section 3.01(c) of the Credit Agreement.  Terms defined 
in the Credit Agreement are used herein as therein defined.

     We have examined originals or copies, certified or otherwise identified 
to our satisfaction, of such documents, corporate records, certificates of 
public officials and other instruments and have conducted such other 
investigations of fact and law as we have deemed necessary or advisable for 
purposes of this opinion.

     Upon the basis of the foregoing, we are of the opinion that, assuming 
that the execution, delivery and performance by the Company and the Borrower 
of the Credit Agreement and by the Borrower of the Notes are within such 
Person's corporate powers and have been duly authorized by all necessary 
corporate action, the Credit Agreement constitutes a valid and binding 
agreement of the Company and the Borrower and the Notes constitute valid and 
binding obligations of the Borrower.

<PAGE>

     We are members of the Bar of the State of New York and the foregoing 
opinion is limited to the laws of the State of New York.  In giving the 
foregoing opinion, we express no opinion as to the effect (if any) of any law 
of any jurisdiction (except the State of New York) in which any Bank is 
located which limits the rate of interest that such Bank may charge or 
collect.

     This opinion is rendered solely to you in connection with the above 
matter. This opinion may not be relied upon by you for any other purpose or 
relied upon by or furnished to any other person without our prior written 
consent.

                                         Very truly yours, 
 


                                       2


<PAGE>

                                                                       EXHIBIT G


                         ASSIGNMENT AND ASSUMPTION AGREEMENT


     AGREEMENT dated as of ________, __ 199_ among [ASSIGNOR] (the 
"Assignor"), [ASSIGNEE] (the "Assignee"), U S WEST, Inc. (the "Company") and 
MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Administrative Agent (the 
"Agent"). 



                                W I T N E S S E T H 

     WHEREAS, this Assignment and Assumption Agreement (the "Agreement") 
relates to the 364-Day Credit Agreement dated as of November 1, 1996 among 
the Company, the Borrower named therein, the Assignor and the other Banks 
party thereto, as Banks, the other agents named therein and the Agent (the 
"Credit Agreement"); 

     WHEREAS, as provided under the Credit Agreement, the Assignor has a 
Commitment to make Loans in an aggregate principal amount at any time 
outstanding not to exceed $__________; 

     WHEREAS, Committed Loans made by the Assignor under the Credit Agreement 
in the aggregate principal amount of $__________ are outstanding at the date 
hereof; and 

     WHEREAS, the Assignor proposes to assign to the Assignee all of the 
rights of the Assignor under the Credit Agreement in respect of a portion of 
its Commitment thereunder in an amount equal to $__________ (the "Assigned 
Amount"), together with a corresponding portion of its outstanding Committed 
Loans, and the Assignee proposes to accept assignment of such rights and 
assume the corresponding obligations from the Assignor on such terms; 

     NOW, THEREFORE, in consideration of the foregoing and the mutual 
agreements contained herein, the parties hereto agree as follows: 

     SECTION 1.  Definitions. All capitalized terms not otherwise defined 
here in shall have the respective meanings set forth in the Credit Agreement. 


<PAGE>


     SECTION 2.  Assignment.  The Assignor hereby assigns and sells to the 
Assignee all of the rights of the Assignor under the Credit 
Agreement to the extent of the Assigned Amount, and the Assignee hereby 
accepts such assignment from the Assignor and assumes all of the obligations 
of the Assignor under the Credit Agreement to the extent of the Assigned 
Amount, including the purchase from the Assignor of the corresponding portion 
of the principal amount of the Committed Loans made by the Assignor 
outstanding at the date hereof.  Upon the execution and delivery hereof by 
the Assignor, the Assignee, the Company and the Agent and the payment of the 
amounts specified in Section 3 required to be paid on the date hereof (i) the 
Assignee shall, as of the date hereof, succeed to the rights and be obligated 
to perform the obligations of a Bank under the Credit Agreement with a 
Commitment in an amount equal to the Assigned Amount, and (ii) the Commitment 
of the Assignor shall, as of the date hereof, be reduced by a like amount and 
the Assignor released from its obligations under the Credit Agreement to the 
extent such obligations have been assumed by the Assignee.  The assignment 
provided for herein shall be without recourse to the Assignor. 

     SECTION 3.  Payments.  As consideration for the assignment and sale 
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on 
the date hereof in Federal funds the amount heretofore agreed between 
them.**** It is understood that commitment and/or facility fees accrued to 
the date hereof are for the account of the Assignor and such fees accruing 
from and including the date hereof are for the account of the Assignee.  Each 
of the Assignor and the Assignee hereby agrees to that if it receives any 
amount under the Credit Agreement which is for the account of the other party 
hereto, it shall receive the same for the account of such other party to the 
extent of such other party's interest therein and shall promptly pay the same 
to such other party. 

     
     [SECTION 4. Consent of the Company and the Agent.  This Agreement is
conditioned upon the consent of the Company and the Agent pursuant to Section
10.06(c) of the Credit Agreement.  The execution of this Agreement by the
Company and the Agent is evidence of this consent.  Pursuant to Section 10.06(c)
the Company agrees to cause the Borrower to execute and deliver a Note payable
to the order of the Assignee to evidence the assignment and assumption provided
for herein.]

____________________

     ****Amount should combine principal together with accrued interest and 
breakage compensation, if any, to be paid by the Assignee, net of any portion 
of any upfront fee to be paid by the Assignor to the Assignee.  It may be 
preferable in an appropriate case to specify these amounts generically or by 
formula rather than as a fixed sum.


                                       2

<PAGE>

     SECTION 5.  Non-Reliance on Assignor.  The Assignor makes no 
representation or warranty in connection with, and shall have no 
responsibility with respect to, the solvency, financial condition, or 
statements of the Company or the Borrower, or the validity and enforceability 
of the obligations of the Company or the Borrower in respect of the Credit 
Agreement or any Note.  The Assignee acknowledges that it has, independently 
and without reliance on the Assignor, and based on such documents and 
information as it has deemed appropriate, made its own credit analysis and 
decision to enter into this Agreement and will continue to be responsible for 
making its own independent appraisal of the business, affairs and financial 
condition of the Company and the Borrower.

     SECTION 6.  Governing Law.  This Agreement shall be governed by and 
construed in accordance with the laws of the State of New York.

     SECTION 7.  Counterparts.  This Agreement may be signed in any number of 
counterparts, each of which shall be an original, with the same effect as if 
the signatures thereto and hereto were upon the same instrument.

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

                                             [ASSIGNOR]

                                             By__________________________
                                               Title:

                                      3

<PAGE>


                                             [ASSIGNEE]

                                             By_________________________
                                               Title:


                                             [U S WEST, INC.

                                             By_________________________
                                               Title:


                                             MORGAN GUARANTY TRUST
                                              COMPANY OF NEW YORK, as
                                              Administrative Agent

                                             By________________________
                                               Title:]

                                      4

<PAGE>

                                                                       EXHIBIT H


                               EXTENSION AGREEMENT


US WEST Capital Funding, Inc.
US WEST, Inc.
7800 East Orchard Road
Englewood, Colorado  80111

Morgan Guaranty Trust Company of
  New York, as Administrative Agent
  under the Credit Agreement referred 
  to below
60 Wall Street
New York, NY  10260

Gentlemen:

     The undersigned hereby agree to extend the Revolving Credit Period under 
the 364-Day Credit Agreement dated as of November 1, 1996 among US WEST 
Capital Funding, Inc., US WEST, Inc., the Banks listed therein, the other 
agents named therein and Morgan Guaranty Trust Company of New York, as 
Administrative Agent (the "Credit Agreement") for 364 days to ____________ 
__, ____.  Terms defined in the Credit Agreement are used herein as therein 
defined.

     This Extension Agreement shall be construed in accordance with and 
governed by the law of the State of New York.  It may be signed in any number 
of counterparts, each of which shall be an original, with the same effect as 
if the signatures thereto and hereto were upon the same instrument.

                                            [NAME OF BANK]*****

                                            By_________________________

____________________

     *****Insert names of Banks which have responded 
affirmatively in accordance with Section 2.01(b) of the Credit Agreement.


<PAGE>

                                               Title:

                                            [NAME OF BANK]***** 

                                            By________________________
                                              Title:


                                            [NAME OF BANK]*

                                            By_______________________
                                              Title:

                                            [NAME OF BANK]*

                                            By_______________________
                                              Title:


                                            [NAME OF BANK]*

                                            By______________________
                                              Title:


                                            [NAME OF BANK]*

                                            By______________________
                                            Title:
____________________

     *****Insert names of Banks which have responded affirmatively in 
accordance with Section 2.01(b) of the Credit Agreement.

                                      2

<PAGE>


Agreed and accepted:

US WEST CAPITAL FUNDING, INC.


By_________________________
  Title


US WEST, INC.


By__________________________
  Title


MORGAN GUARANTY TRUST COMPANY
  OF NEW YORK, as Administrative Agent


By___________________________
  Title

                                      3


<PAGE>
                                                                  CONFORMED COPY






                                    $3,000,000,000

                                      FIVE-YEAR

                                   CREDIT AGREEMENT


                                     dated as of


                                   November 1, 1996


                                        among


                            U S WEST Capital Funding, Inc.
                                    U S WEST, Inc.


                               The Banks Listed Herein

                                   Citibank, N.A., 
                                 as Syndication Agent
                                           

                                The Bank of New York,
                                as Documentation Agent
                                           
                                         and

                      Morgan Guaranty Trust Company of New York,
                               as Administrative Agent 

<PAGE>

                               TABLE OF CONTENTS


                                                                            Page
                                    ARTICLE 1
                                   Definitions
Section 1.01.  Definitions.....................................................1
Section 1.02.  Accounting Terms and Determinations............................11
Section 1.03.  Types of Borrowings............................................12

                                   ARTICLE 2
                                  The Credit
Section 2.01.  Commitments to Lend.......... .................................12
Section 2.02.  Notice of Committed Borrowing..................................13
Section 2.03.  Money Market Borrowings........................................14
Section 2.04.  Notice to Banks; Funding of Loans..............................18
Section 2.05.  Notes..........................................................19
Section 2.06.  Maturity of Loans..............................................19
Section 2.07.  Interest Rates.................................................19
Section 2.08.  Facility Fees..................................................22
Section 2.09.  Optional Termination or Reduction of Commitments...............22
Section 2.10.  Method of Electing Interest Rates..............................22
Section 2.11.  Optional Prepayments...........................................24
Section 2.12.  General Provisions as to Payments..............................24
Section 2.13.  Funding Losses.................................................25
Section 2.14.  Computation of Interest and Fees...............................25
Section 2.15.  Change of Control..............................................26

                                   ARTICLE 3
                                  Conditions
Section 3.01.  Closing........................................................26
Section 3.02.  Borrowings.....................................................27

------------------
*The Table of Contents is not part of this Agreement.


                                          i
<PAGE>

                                   ARTICLE 4
                          Representations and Warranties                   
                                                                            Page
Section 4.01.  Corporate Existence and Power.................................28
Section 4.02.  Corporate and Governmental Authorization; No Contravention....28
Section 4.03.  Binding Effect................................................28
Section 4.04.  Financial Information.........................................28
Section 4.05.  Litigation....................................................29
Section 4.06.  Compliance with ERISA.........................................29
Section 4.07.  Environmental Matters.........................................30
Section 4.08.  Taxes.........................................................30
Section 4.09.  Subsidiaries..................................................31
Section 4.10.  Not an Investment Company.....................................31
Section 4.11.  Full Disclosure...............................................31

                                   ARTICLE 5
                                   Covenants
Section 5.01.  Information....................................................31
Section 5.02.  Maintenance of Property; Insurance.............................33
Section 5.03.  Maintenance of Existence.......................................34
Section 5.04.  Compliance with Laws...........................................34
Section 5.05.  Inspection of Property, Books and Records......................34
Section 5.06.  Subsidiary Debt................................................34
Section 5.07.  Debt Coverage..................................................35
Section 5.08.  Negative Pledge................................................35
Section 5.09.  Consolidations, Mergers and Sales of Assets....................36
Section 5.10.  Use of Proceeds................................................36

                                   ARTICLE 6
                                    Defaults
Section 6.01.  Events of Default..............................................37
Section 6.02.  Notice of Default..............................................39

                                   ARTICLE 7
                                   The Agent
Section 7.01.  Appointment and Authorization..................................39
Section 7.02.  Agent and Affiliates...........................................39
Section 7.03.  Action by Agent................................................40
Section 7.04.  Consultation with Experts......................................40
Section 7.05.  Liability of Agent.............................................40


                                          ii
<PAGE>

                                                                           Page
Section 7.06.  Indemnification..............................................40
Section 7.07.  Credit Decision..............................................41
Section 7.08.  Successor Agent..............................................41
Section 7.09.  Agent's Fee..................................................41
Section 7.10.  Other Agents.................................................41

                                   ARTICLE 8
                           Changes in Circumstances
Section 8.01.  Basis for Determining Interest Rate Inadequate
                 or Unfair....................................................42
Section 8.02.  Illegality.....................................................42
Section 8.03.  Increased Cost and Reduced Return..............................43
Section 8.04.  Taxes..........................................................44
Section 8.05.  Domestic Loans Substituted for Affected
                 Euro-Dollar Loans............................................46
Section 8.06.  Substitution of Bank...........................................46

                                   ARTICLE 9
                                   Guaranty
Section 9.01.  The Guaranty...................................................47
Section 9.02.  Guaranty Unconditional.........................................47
Section 9.03.  Discharge Only upon Payment in Full;
                 Reinstatement In Certain Circumstances.......................48
Section 9.04.  Waiver by the Company..........................................48
Section 9.05.  Subrogation....................................................48
Section 9.06.  Stay of Acceleration...........................................49

                                   ARTICLE 10
                                  Miscellaneous
Section 10.01.  Notices.......................................................49
Section 10.02.  No Waivers....................................................49
Section 10.03.  Expenses; Indemnification.....................................49
Section 10.04.  Sharing of Set-offs...........................................51
Section 10.05.  Amendments and Waivers........................................51
Section 10.06.   Successors and Assigns.......................................51
Section 10.07.  Termination of Existing Credit Agreements.....................53
Section 10.08.  Governing Law; Submission to Jurisdiction.....................53
Section 10.09.  Counterparts; Integration; Effectiveness......................54
Section 10.10.  WAIVER OF JURY TRIAL..........................................54
Section 10.11.  Confidentiality...............................................54


                                         iii
<PAGE>




                                         iv

<PAGE>

Pricing Schedule

Schedule 4.07  -  Environmental Matters

Exhibit A -   Note

Exhibit B -   Money Market Quote Request

Exhibit C -   Invitation for Money Market Quotes

Exhibit D -   Money Market Quote

Exhibit E -   Opinion of Counsel for the Company and the Borrower

Exhibit F -   Opinion of Special Counsel for the Administrative Agent

Exhibit G -   Assignment and Assumption Agreement

Exhibit H -   Extension Agreement


                                          v

<PAGE>

                                CREDIT AGREEMENT


     AGREEMENT dated as of November 1, 1996 among U S WEST Capital Funding, 
Inc., U S WEST, Inc., the BANKS listed on the signature pages hereof, 
CITIBANK, N.A., as Syndication Agent, THE BANK OF NEW YORK, as Documentation 
Agent, and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Administrative Agent.

     The parties hereto agree as follows:

                                   ARTICLE 1
                                  Definitions
     Section 1.01.  Definitions

     The following terms, as used herein, have the following meanings:

     "Absolute Rate Auction" means a solicitation of Money Market Quotes 
setting forth Money Market Absolute Rates pursuant to Section 2.03.

     "Acquisition" means the merger of Continental Cablevision, Inc. 
("Continental"), with and into the Company or a Wholly-Owned Consolidated 
Subsidiary, provided that the cash consideration payable to shareholders of 
Continental in connection with such merger shall not exceed the "Cash 
Consideration Amount" (as defined in the Agreement and Plan of Merger among 
the Company, Continental Merger Corporation and Continental dated as of 
February 27, 1996 and amended and restated as of June 27, 1996 and further 
amended as of October 7, 1996) without the consent of the Required Banks, 
which consent shall not be unreasonably withheld or delayed.

     "Adjusted London Interbank Offered Rate" has the meaning set forth in 
Section 2.07(b).

     "Administrative Questionnaire" means, with respect to each Bank, an 
administrative questionnaire in the form prepared by the Agent and submitted 
to the Agent (with a copy to the Company) duly completed by such Bank.

     "Agent" means Morgan Guaranty Trust Company of New York in its capacity 
as administrative agent for the Banks hereunder, and its successors in such 
capacity.

<PAGE>

     "Applicable Lending Office" means, with respect to any Bank, (i) in the 
case of its Domestic Loans, its Domestic Lending Office, (ii) in the case of 
its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case 
of its Money Market Loans, its Money Market Lending Office.

     "Assignee" has the meaning set forth in Section 10.06(c).

     "Bank" means each bank listed on the signature pages hereof, each 
Assignee which becomes a Bank pursuant to Section 10.06(c), and their 
respective successors.

     "Base Rate" means, for any day, a rate per annum equal to the higher of 
(i) the Prime Rate for such day and  (ii) the sum of 1/2 of 1% plus the 
Federal Funds Rate for such day.

     "Benefit Arrangement" means at any time an employee benefit plan within 
the meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer 
Plan and which is maintained or otherwise contributed to by any member of the 
ERISA Group.

     "Borrower" means U S WEST Capital Funding, Inc., a Colorado corporation, 
and its successors.

     "Borrowing" has the meaning set forth in Section 1.03.

     "Closing Date" means the date on or after the Effective Date on which 
the Agent shall have received the documents specified in or pursuant to 
Section 3.01.

     "Commitment" means, with respect to each Bank, the amount set forth 
opposite the name of such Bank on the signature pages hereof, as such amount 
may be reduced from time to time pursuant to Sections 2.09 and 2.11.

     "Committed Loan" means a loan to be made by a Bank pursuant to Section 
2.01(a); provided that if any such loan or loans are combined or subdivided 
pursuant to a Notice of Interest Rate Election, the term "Committed Loan" 
shall refer to the combined principal amount resulting from such combination 
or to each of the separate principal amounts resulting from such subdivision, 
as the case may be.

     "Company" means U S WEST, Inc., a Delaware corporation, and its 
successors.

                                          2

<PAGE>

     "Company's 1995 Form 10-K" means the Company's annual report on Form 
10-K for 1995, as filed with the Securities and Exchange Commission pursuant 
to the Securities Exchange Act of 1934.

     "Consolidated Net Worth" means at any date the consolidated shareowners' 
equity of the Company and its Consolidated Subsidiaries determined as of such 
date.

     "Consolidated Subsidiary" means at any date any Subsidiary or other 
entity the accounts of which would be consolidated with those of the Company 
in its consolidated financial statements if such statements were prepared as 
of such date.

     "Debt" of any Person means at any date, without duplication, (i) all 
obligations of such Person for borrowed money, (ii) all obligations of such 
Person evidenced by bonds, debentures, notes or other similar instruments, 
(iii) all obligations of such Person to pay the deferred purchase price of 
property or services, except trade accounts payable arising in the ordinary 
course of business, (iv) all obligations of such Person as lessee which are 
capitalized in accordance with generally accepted accounting principles, (v) 
all Debt secured by a Lien on any asset of such Person, whether or not such 
Debt is otherwise an obligation of such Person, and (vi) all Debt of others 
Guaranteed by such Person.  Notwithstanding the foregoing, for purposes of 
Sections 5.06 and 5.07 Debt shall in no event include the following:

     (x) Debt of Persons which are not Consolidated Subsidiaries ("Joint 
Ventures") (i) which is secured by a Lien on the assets or capital stock of a 
Minor Subsidiary or the equity interests in such Joint Ventures or is 
Guaranteed by a Minor Subsidiary, which Lien or Guarantee is incurred in 
connection with the international operations of the Company and its 
Subsidiaries, and (ii) for the payment of which no other recourse may be had 
to the Company or any of its Subsidiaries; and

     (y) Debt of the Company or the Borrower issued in connection with the 
issuance of Trust Originated Preferred Securities or substantially similar 
securities, so long as such Debt is subordinated and junior in right of 
payment to substantially all liabilities of the Company or the Borrower, as 
the case may be, including, without limitation, the Loans.

     "Default" means any condition or event which constitutes an Event of 
Default or which with the giving of notice or lapse of time or both would, 
unless cured or waived, become an Event of Default.

                                          3

<PAGE>


     "Domestic Business Day" means any day except a Saturday, Sunday or other 
day on which commercial banks in New York City are authorized by law to close.

     "Domestic Lending Office" means, as to each Bank, its office located at 
its address set forth in its Administrative Questionnaire (or identified in 
its Administrative Questionnaire as its Domestic Lending Office) or such 
other office as such Bank may hereafter designate as its Domestic Lending 
Office by notice to the Company and the Agent.

     "Domestic Loan" means (i) a Committed Loan which bears interest at the 
Base Rate pursuant to the applicable Notice of Committed Borrowing or Notice 
of Interest Rate Election or the provisions of Article 8 or (ii) an overdue 
amount which was a Domestic Loan immediately before it became overdue.

     "Effective Date" means the date this Agreement becomes effective in 
accordance with Section 10.09.

     "Environmental Laws" means any and all federal, state, local and foreign 
statutes, laws, judicial decisions, regulations, ordinances, rules, 
judgments, orders, decrees, plans, injunctions, permits, concessions, grants, 
franchises, licenses, agreements and other governmental restrictions relating 
to the environment, the effect of the environment on human health or to 
emissions, discharges or releases of pollutants, contaminants, Hazardous 
Substances or wastes into the environment including, without limitation, 
ambient air, surface water, ground water, or land, or otherwise relating to 
the manufacture, processing, distribution, use, treatment, storage, disposal, 
transport or handling of pollutants, contaminants, Hazardous Substances or 
wastes or the clean-up or other remediation thereof. 

     "ERISA" means the Employee Retirement Income Security Act of 1974, as 
amended, or any successor statute.

     "ERISA Group" means the Company, any Subsidiary and all members of a 
controlled group of corporations and all trades or businesses (whether or not 
incorporated) under common control which, together with the Company or any 
Subsidiary, are treated as a single employer under Section 414 of the 
Internal Revenue Code.

     "Euro-Dollar Business Day" means any Domestic Business Day on which 
commercial banks are open for international business (including dealings in 
dollar deposits) in London.

                                          4

<PAGE>


     "Euro-Dollar Lending Office" means, as to each Bank, its office, branch 
or affiliate located at its address set forth in its Administrative 
Questionnaire (or identified in its Administrative Questionnaire as its 
Euro-Dollar Lending Office) or such other office, branch or affiliate of such 
Bank as it may hereafter designate as its Euro-Dollar Lending Office by 
notice to the Company and the Agent.

     "Euro-Dollar Loan" means (i) a Committed Loan which bears interest at a 
Euro-Dollar Rate pursuant to the applicable Notice of Committed Borrowing or 
Notice of Interest Rate Election or (ii) an overdue amount which was a 
Euro-Dollar Loan before it became overdue.

     "Euro-Dollar Margin" has the meaning set forth in Section 2.07(b). 

     "Euro-Dollar Rate" means a rate of interest determined pursuant to 
Section 2.07(b) on the basis of an Adjusted London Interbank Offered Rate.

     "Euro-Dollar Reference Banks" means the principal London offices of 
Citibank, N.A., The Bank of New York and Morgan Guaranty Trust Company of New 
York, and "Euro-Dollar Reference Bank" means any one of the foregoing.

     "Euro-Dollar Reserve Percentage" has the meaning set forth in Section 
2.07(b).

     "Event of Default" has the meaning set forth in Section 6.01.

     "Existing Credit Agreements" means the Credit Agreements dated as of 
August 8, 1994, as amended,  among the Borrower, the Company, the banks 
listed on the signature pages thereof and Morgan Guaranty Trust Company of 
New York, as Agent.

      "Federal Funds Rate" means, for any day, the rate per annum (rounded 
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted 
average of the rates on overnight Federal funds transactions with members of 
the Federal Reserve System arranged by Federal funds brokers on such day, as 
published by the Federal Reserve Bank of New York on the Domestic Business 
Day next succeeding such day, provided that (i) if such day is not a Domestic 
Business Day, the Federal Funds Rate for such day shall be such rate on such 
transactions on the next preceding Domestic Business Day as so published on 
the next succeeding Domestic Business Day, and (ii) if no such rate is so 
published on such next succeeding Domestic Business Day, the Federal Funds 
Rate for such day shall be the average rate quoted to Morgan Guaranty Trust 
Company of New York on such day on such transactions as determined by the 
Agent.

                                          5

<PAGE>


     "Fixed Rate Loans" means Euro-Dollar Loans or Money Market Loans 
(excluding Money Market LIBOR Loans bearing interest at the Base Rate 
pursuant to Section 8.01(a)) or any combination of the foregoing.

     "Group of Loans" means at any time a group of Loans consisting of (i) 
all Committed Loans which are Domestic Loans at such time or (ii) all 
Committed Loans which are Euro-Dollar Loans having the same Interest Period 
at such time; provided that, if a Committed Loan of any particular Bank is 
converted to or made as a Domestic Loan pursuant to Section 8.02 or 8.05, 
such Loan shall be included in the same Group or Groups of Loans from time to 
time as it would have been in if it had not been so converted or made.

     "Guarantee" by any Person means any obligation, contingent or otherwise, 
of such Person directly or indirectly guaranteeing any Debt or other 
obligation of any other Person and, without limiting the generality of the 
foregoing, any obligation, direct or indirect, contingent or otherwise, of 
such Person (i) to purchase or pay (or advance or supply funds for the 
purchase or payment of) such Debt or other obligation (whether arising by 
virtue of partnership arrangements, by agreement to keep-well, to purchase 
assets, goods, securities or services, to take-or-pay, or to maintain 
financial statement conditions or otherwise) or (ii) entered into for the 
purpose of assuring in any other manner the obligee of such Debt or other 
obligation of the payment thereof or to protect such obligee against loss in 
respect thereof (in whole or in part), provided that the term Guarantee shall 
not include endorsements for collection or deposit in the ordinary course of 
business.  The term "Guarantee" used as a verb has a corresponding meaning.

     "Hazardous Substances" means any toxic, radioactive, caustic or 
otherwise hazardous substance, including petroleum, its derivatives, 
by-products and other hydrocarbons, or any substance having any constituent 
elements displaying any of the foregoing characteristics.

     "Indemnitee" has the meaning set forth in Section 10.03(b).

     "Indentures" means the agreements or instruments evidencing the 
following Debt of Continental Cablevision, Inc., and its successors: (i) the 
10 5/8% Senior Subordinated Notes Due June 15, 2002; (ii) the 11% Senior 
Subordinated Debentures Due June 1, 2007; (iii) the 8 5/8% Senior Notes Due 
August 15, 2003; (iv) the 9% Senior Debentures Due September 1, 2008; (v) the 
8 7/8% Senior Debentures Due September 15, 2002; (vi) the 9 1/2% Senior 
Debentures Due August 1, 2013; (vii) the 8 1/2% Senior Notes Due September 
15, 2001; and (viii) any other Debt containing terms and conditions as or more

                                          6

<PAGE>


favorable to the holders thereof than the terms and conditions of any of the 
foregoing Debt.

     "Interest Period" means:  (1) with respect to each Euro-Dollar Loan, a 
period commencing on the date of borrowing specified in the applicable Notice 
of Borrowing or the date specified in the applicable Notice of Interest Rate 
Election and ending one, two, three or six months thereafter, as the Borrower 
may elect in the applicable notice; provided that:

          (a)  any Interest Period which would otherwise end on a day which 
is not a Euro-Dollar Business Day shall be extended to the next succeeding 
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in 
another calendar month, in which case such Interest Period shall end on the 
next preceding Euro-Dollar Business Day;

          (b)  any Interest Period which begins on the last Euro-Dollar 
Business Day of a calendar month (or on a day for which there is no 
numerically corresponding day in the calendar month at the end of such 
Interest Period) shall, subject to clause (c) below, end on the last 
Euro-Dollar Business Day of a calendar month; and

          (c)  any Interest Period which would otherwise end after a 
Termination Date shall end on such Termination Date.

     (2)  with respect to each Money Market LIBOR Loan, the period commencing 
on the date of borrowing specified in the applicable Notice of Borrowing and 
ending such whole number of months thereafter as the Borrower may elect in 
accordance with Section 2.03; provided that:

          (a)  any Interest Period which would otherwise end on a day which 
is not a Euro-Dollar Business Day shall be extended to the next succeeding 
Euro-Dollar Business Day unless such Euro-Dollar Business Day falls in 
another calendar month, in which case such Interest Period shall end on the 
next preceding Euro-Dollar Business Day;

          (b)  any Interest Period which begins on the last Euro-Dollar 
Business Day of a calendar month (or on a day for which there is no 
numerically corresponding day in the calendar month at the end of such 
Interest Period) shall, subject to clause (c) below, end on the last 
Euro-Dollar Business Day of a calendar month; and

                                          7

<PAGE>

          (c)  any Interest Period which would otherwise end after a 
Termination Date shall end on such Termination Date.

     (3)  with respect to each Money Market Absolute Rate Loan, the period 
commencing on the date of borrowing specified in the applicable Notice of 
Borrowing and ending such number of days thereafter (but not less than 7 
days) as the Borrower may elect in accordance with Section 2.03; provided 
that:

          (a)  any Interest Period which would otherwise end on a day which 
is not a Euro-Dollar Business Day shall be extended to the next succeeding 
Euro-Dollar Business Day; and

          (b)  any Interest Period which would otherwise end after a 
Termination Date shall end on such Termination Date.

     "Internal Revenue Code" means the Internal Revenue Code of 1986, as 
amended, or any successor statute.

     "LIBOR Auction" means a solicitation of Money Market Quotes setting 
forth Money Market Margins based on the London Interbank Offered Rate 
pursuant to Section 2.03.

     "Lien" means, with respect to any asset, any mortgage, lien, pledge, 
charge, security interest or encumbrance of any kind, or any other type of 
preferential arrangement that has the practical effect of creating a security 
interest, in respect of such asset.  For the purposes of this Agreement, the 
Company or any Subsidiary shall be deemed to own subject to a Lien any asset 
which it has acquired or holds subject to the interest of a vendor or lessor 
under any conditional sale agreement, capital lease or other title retention 
agreement relating to such asset.

     "Loan" means a Domestic Loan or a Euro-Dollar Loan or a Money Market 
Loan and "Loans" means Domestic Loans or Euro-Dollar Loans or Money Market 
Loans or any combination of the foregoing.

     "London Interbank Offered Rate" has the meaning set forth in Section 
2.07(b).

     "Margin Stock" means "margin stock" as such term is defined in 
Regulation U of the Board of Governors of the Federal Reserve System, as in 
effect from time to time.

                                          8

<PAGE>


     "Material Debt" means Debt (other than the Notes) of the Company and/or 
one or more of its Subsidiaries, arising in one or more related or unrelated 
transactions, in an aggregate principal amount exceeding $100,000,000.

     "Material Plan" means at any time a Plan or Plans having aggregate 
Unfunded Liabilities in excess of $100,000,000.

     "Minor Subsidiary" means, for purposes of the last sentence of the 
definition of Debt and of Section 5.08(f) (the "Relevant Provisions"), (i) 
USW PCN Inc., and (ii) any other Subsidiary which, at the time of the 
issuance of a Guarantee or grant of a Lien referred to in the Relevant 
Provisions, had assets which, when taken together with all assets of 
Subsidiaries at any earlier time when such Subsidiaries were deemed to be 
Minor Subsidiaries pursuant to this clause (ii), did not exceed $250,000,000.

     "Money Market Absolute Rate" has the meaning set forth in Section 
2.03(d).

     "Money Market Absolute Rate Loan" means a loan to be made by a Bank 
pursuant to an Absolute Rate Auction.

     "Money Market Lending Office" means, as to each Bank, its Domestic 
Lending Office or such other office, branch or affiliate of such Bank as it 
may hereafter designate as its Money Market Lending Office by notice to the 
Company and the Agent; provided that any Bank may from time to time by notice 
to the Company and the Agent designate separate Money Market Lending Offices 
for its Money Market LIBOR Loans, on the one hand, and its Money Market 
Absolute Rate Loans, on the other hand, in which case all references herein 
to the Money Market Lending Office of such Bank shall be deemed to refer to 
either or both of such offices, as the context may require.

     "Money Market LIBOR Loan" means a loan to be made by a Bank pursuant to 
a LIBOR Auction (including such a loan bearing interest at the Base Rate 
pursuant to Section 8.01(a)).

     "Money Market Loan" means a Money Market LIBOR Loan or a Money Market 
Absolute Rate Loan.

     "Money Market Margin" has the meaning set forth in Section 2.03(d).

     "Money Market Quote" means an offer by a Bank to make a Money Market 
Loan in accordance with Section 2.03.

                                          9

<PAGE>

     "Multiemployer Plan" means at any time an employee pension benefit plan 
within the meaning of Section 4001(a)(3) of ERISA to which any member of the 
ERISA Group is then making or accruing an obligation to make contributions or 
has within the preceding five plan years made contributions, including for 
these purposes any Person which ceased to be a member of the ERISA Group 
during such five year period.

     "Notes" means promissory notes of the  Borrower, substantially in the 
form of Exhibit A hereto, evidencing the obligation of the Borrower to repay 
the Loans made to it, and "Note" means any one of such promissory notes 
issued hereunder.

     "Notice of Borrowing" means a Notice of Committed Borrowing (as defined 
in Section 2.02) or a Notice of Money Market Borrowing (as defined in Section 
2.03(f)). "Parent" means, with respect to any Bank, any Person controlling 
such Bank.

     "Participant" has the meaning set forth in Section 10.06(b). "PBGC" 
means the Pension Benefit Guaranty Corporation or any entity succeeding to 
any or all of its functions under ERISA.

     "Person" means an individual, a corporation, a partnership, an 
association, a trust or any other entity or organization, including a 
government or political subdivision or an agency or instrumentality thereof.

     "Plan" means at any time an employee pension benefit plan (other than a 
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the 
minimum funding standards under Section 412 of the Internal Revenue Code and 
either (i) is maintained, or contributed to, by any member of the ERISA Group 
for employees of any member of the ERISA Group or (ii) has at any time within 
the preceding five years been maintained, or contributed to, by any Person 
which was at such time a member of the ERISA Group for employees of any 
Person which was at such time a member of the ERISA Group.

     "Pricing Schedule" means the Schedule attached hereto and identified as 
such.

                                          10

<PAGE>

     "Prime Rate" means the rate of interest publicly announced by Morgan 
Guaranty Trust Company of New York in New York City from time to time as its 
Prime Rate.

     "Required Banks" means at any time Banks having more than 50% of the 
aggregate amount of the Commitments or, if the Commitments shall have been 
terminated, holding Notes evidencing more than 50% of the aggregate unpaid 
principal amount of the Loans.

     "Revolving Credit Period" means the period from and including the 
Effective Date to but excluding the Termination Date.

     "Significant Subsidiary" means any Subsidiary which would meet the 
definition of "significant subsidiary" contained as of the date hereof in 
Regulation S-X of the Securities and Exchange Commission.

     "Subsidiary" means any corporation or other entity of which securities 
or other ownership interests having ordinary voting power to elect a majority 
of the board of directors or other persons performing similar functions are 
at the time directly or indirectly owned by the Company.

     "Super-Majority Banks" means at any time Banks having at least 85% of 
the aggregate amount of the Commitments or, if the Commitments shall have 
been terminated, holding Notes evidencing at least 85% of the aggregate 
unpaid principal amount of the Loans.

     "Termination Date" means, with respect to each Bank, November 1, 2001, 
or such later date to which the Termination Date for such Bank shall have 
been extended pursuant to Section 2.01(b), or, if such day is not a 
Euro-Dollar Business Day, the next preceding Euro-Dollar Business Day.

     "Unfunded Liabilities" means, with respect to any Plan at any time, the 
amount (if any) by which (i) the value of all benefit liabilities under such 
Plan, determined on a plan termination basis using the assumptions prescribed 
by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair 
market value of all Plan assets allocable to such liabilities under Title IV 
of ERISA (excluding any accrued but unpaid contributions), all determined as 
of the then most recent valuation date for such Plan, but only to the extent 
that such excess represents a potential liability of a member of the ERISA 
Group to the PBGC or any other Person under Title IV of ERISA.

                                          11

<PAGE>

     "United States" means the United States of America, including the States 
and the District of Columbia, but excluding its territories and possessions.

     "Wholly-Owned Consolidated Subsidiary" means any Consolidated Subsidiary 
all of the shares of capital stock or other ownership interests of which 
(except directors' qualifying shares) are at the time directly or indirectly 
owned by the Company.

     Section 1.02. Accounting Terms and Determinations. Unless otherwise 
specified herein, all accounting terms used herein shall be interpreted, all 
accounting determinations hereunder shall be made, and all financial 
statements required to be delivered hereunder shall be prepared in accordance 
with generally accepted accounting principles as in effect from time to time 
in the United States, applied on a basis consistent (except for changes 
concurred in by the Company's independent public accountants) with the most 
recent audited consolidated financial statements of the Company and its 
Consolidated Subsidiaries delivered to the Banks; provided that, if the 
Company notifies the Agent that the Company wishes to amend any covenant in 
Article 5 to eliminate the effect of any change in such generally accepted 
accounting principles on the operation of such covenant (or if the Agent 
notifies the Company that the Required Banks wish to amend Article 5 for such 
purpose), then compliance with such covenant shall be determined on the basis 
of generally accepted accounting principles in effect in the United States 
immediately before the relevant change in generally accepted accounting 
principles became effective, until either such notice is withdrawn or such 
covenant is amended in a manner satisfactory to the Company and the Required 
Banks.

     Section 1.03. Types of Borrowings. The term "Borrowing" denotes the 
aggregation of Loans of one or more Banks to be made to the Borrower pursuant 
to Article 2 on a single date, all of which Loans are of the same type 
(subject to Article 8) and, except in the case of Domestic Loans, have the 
same Interest Period or initial Interest Period.  Borrowings are classified 
for purposes of this Agreement either by reference to the pricing of Loans 
comprising such Borrowing (e.g., a "Euro-Dollar Borrowing" is a Borrowing 
comprised of Euro-Dollar Loans) or by reference to the provisions of Article 
2 under which participation therein is determined (i.e., a "Committed 
Borrowing" is a Borrowing under Section 2.01(a) in which all Banks 
participate in proportion to their Commitments, while a "Money Market 
Borrowing" is a Borrowing under Section

                                          12

<PAGE>

2.03 in which the Bank participants are determined on the basis of their bids 
in accordance therewith).

                                    ARTICLE 2
                                    The Credit

     Section 2.01. Commitments to Lend.

     (a)  The Commitments.  During the Revolving Credit Period each Bank 
severally agrees, on the terms and conditions set forth in this Agreement, to 
make loans to the Borrower pursuant to this Section from time to time in 
amounts such that the aggregate principal amount of Committed Loans by such 
Bank at any one time outstanding to the Borrower shall not exceed the amount 
of its Commitment.  Each Borrowing under this Section shall be in an 
aggregate principal amount of $25,000,000 or any larger multiple of 
$5,000,000 (except that any such Borrowing may be in the aggregate amount 
available in accordance with Section 3.02(c)) and shall be made from the 
several Banks ratably in proportion to their respective Commitments.  Within 
the foregoing limits, the Borrower may borrow under this Section, repay, or 
to the extent permitted by Section 2.11, prepay Loans and reborrow at any 
time during the Revolving Credit Period under this Section.  The Commitments 
shall terminate at the close of business on the Termination Date.

     (b)  Extension of Commitments.  The Commitments may be extended in the 
manner and amount set forth in this subsection (b), for a period of 364 days 
measured from the Termination Date then in effect.  If the Company wishes to 
request an extension of each Bank's Commitment, it shall give notice to that 
effect to the Agent not less than 45 days prior to the Termination Date then 
in effect, whereupon the Agent shall promptly notify each of the Banks of 
such request.  Each Bank will use its best efforts to respond to such 
request, whether affirmatively or negatively, as it may elect in its 
discretion, within 30 days of such notice to the Agent.  If any Bank shall 
not have responded affirmatively within such 30-day period, such Bank shall 
be deemed to have rejected the Company's proposal to extend its Commitment, 
and only the Commitments of those Banks which have responded affirmatively 
shall be extended, subject to receipt by the Agent of counterparts of an 
Extension Agreement in substantially the form of Exhibit H hereto duly 
completed and signed by the Borrower, the Company, the Agent and all of the 
Banks which have responded affirmatively.  The Agent shall provide to the 
Company, no later than 10 days prior to the Termination Date then in effect, 
a list of the Banks which have responded affirmatively.  The Extension

                                          13

<PAGE>

Agreement shall be executed and delivered no later than five days prior to 
the Termination Date then in effect, and no extension of the Commitments 
pursuant to this subsection (b) shall be legally binding on any party hereto 
unless and until such Extension Agreement is so executed and delivered.  The 
Company and the Borrower may decline to execute and deliver such Extension 
Agreement if any Bank has rejected the Company's proposal to extend its 
Commitment or has failed to execute and deliver such Extension Agreement, and 
will promptly notify the Agent and the Banks if it so declines.

     Section 2.02. Notice of Committed Borrowing. The Borrower shall give the 
Agent notice (a "Notice of Committed Borrowing") not later than 10:30 A.M. 
(New York City time) on (x) the date of each Domestic Borrowing, and (y) the 
third Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:

     (i)  the date of such Borrowing, which shall be a Domestic Business Day 
in the case of a Domestic Borrowing or a Euro-Dollar Business Day in the case 
of a Euro-Dollar Borrowing,

     (ii)  the aggregate amount of such Borrowing,

     (iii)  whether the Loans comprising such Borrowing bear interest 
initially at the Base Rate or at a Euro-Dollar Rate, and

     (iv)  in the case of a Euro-Dollar Borrowing, the duration of the 
initial Interest Period applicable thereto, subject to the provisions of the 
definition of Interest Period.

    Section 2.03. Money Market Borrowings. (a)  The Money Market Option.  In 
addition to Committed Borrowings pursuant to Section 2.01(a), the Borrower 
may, as set forth in this Section, request the Banks during the Revolving 
Credit Period to make offers to make Money Market Loans to the Borrower.  The 
Banks may, but shall have no obligation to, make such offers and the Borrower 
may, but shall have no obligation to, accept any such offers in the manner 
set forth in this Section.

     (b)  Money Market Quote Request.  When the Borrower wishes to request 
offers to make Money Market Loans under this Section, it shall transmit to 
the Agent by telex or facsimile transmission a Money Market Quote Request 
substantially in the form of Exhibit B hereto so as to be received no later 
than 9:00 A.M. (New York City time) on (x) the fourth Euro-Dollar Business 
Day prior to the date of Borrowing proposed therein, in the case of a LIBOR 
Auction or (y) the Domestic Business Day prior to the date of Borrowing 
proposed therein,

                                          14

<PAGE>

in the case of an Absolute Rate Auction (or, in either case, such other time 
or date as the Company and the Agent shall have mutually agreed and shall 
have notified to the Banks not later than the date of the Money Market Quote 
Request for the first LIBOR Auction or Absolute Rate Auction for which such 
change is to be effective) specifying:

     (i)  the proposed date of Borrowing, which shall be a Euro-Dollar 
Business Day in the case of a LIBOR Auction or a Domestic Business Day in the 
case of an Absolute Rate Auction,

     (ii)  the aggregate amount of such Borrowing, which shall be $25,000,000 
or a larger multiple of $5,000,000,

     (iii)  the duration of the Interest Period applicable thereto, subject 
to the provisions of the definition of Interest Period, and

     (iv)  whether the Money Market Quotes requested are to set forth a Money 
Market Margin or a Money Market Absolute Rate.

     The Borrower may request offers to make Money Market Loans for more than 
one Interest Period in a single Money Market Quote Request.  No Money Market 
Quote Request shall be given within five Euro-Dollar Business Days (or such 
other number of days as the Company and the Agent may agree) of any other 
Money Market Quote Request.

     (c)  Invitation for Money Market Quotes.  Promptly upon receipt of a 
Money Market Quote Request, the Agent shall send to the Banks by telex or 
facsimile transmission an Invitation for Money Market Quotes substantially in 
the form of Exhibit C hereto, which shall constitute an invitation by the 
Borrower to each Bank to submit Money Market Quotes offering to make the 
Money Market Loans to which such Money Market Quote Request relates in 
accordance with this Section.

     (d)  Submission and Contents of Money Market Quotes.  (i)  Each Bank may 
submit a Money Market Quote containing an offer or offers to make Money 
Market Loans in response to any Invitation for Money Market Quotes.  Each 
Money Market Quote must comply with the requirements of this subsection (d) 
and must be submitted to the Agent by telex or facsimile transmission at its 
offices specified in or pursuant to Section 10.01 not later than (x) 10:30 
A.M. (New York City time) on the third Euro-Dollar Business Day prior to the 
proposed date of Borrowing, in the case of a LIBOR Auction or (y) 9:15 A.M. 
(New York City time) on the proposed date of Borrowing, in the case of an

                                          15

<PAGE>

Absolute Rate Auction (or, in either case, such other time or date as the 
Company and the Agent shall have mutually agreed and shall have notified to 
the Banks not later than the date of the Money Market Quote Request for the 
first LIBOR Auction or Absolute Rate Auction for which such change is to be 
effective); provided that Money Market Quotes submitted by the Agent (or any 
affiliate of the Agent) in the capacity of a Bank may be submitted, and may 
only be submitted, if the Agent or such affiliate notifies the Borrower of 
the terms of the offer or offers contained therein not later than (x) one 
hour prior to the deadline for the other Banks, in the case of a LIBOR 
Auction or (y) 15 minutes prior to the deadline for the other Banks, in the 
case of an Absolute Rate Auction.  Subject to Articles 3 and 6, any Money 
Market Quote so made shall be irrevocable except with the written consent of 
the Agent given on the instructions of the Borrower.

     (ii)  Each Money Market Quote shall be in substantially the form of 
Exhibit D hereto and shall in any case specify:

     (A)  the proposed date of Borrowing,

     (B)  the principal amount of the Money Market Loan for which each such 
offer is being made, which principal amount (w) may be greater than or less 
than the Commitment of the quoting Bank, (x) must be $5,000,000 or a larger 
multiple of $1,000,000, (y) may not exceed the principal amount of Money 
Market Loans for which offers were requested, and (z) may be subject to an 
aggregate limitation as to the principal amount of Money Market Loans for 
which offers being made by such quoting Bank may be accepted,

     (C)  in the case of a LIBOR Auction, the margin above or below the 
applicable London Interbank Offered Rate (the "Money Market Margin") offered 
for each such Money Market Loan, expressed as a percentage (specified to the 
nearest 1/10,000th of 1%) to be added to or subtracted from such base rate,

     (D)  in the case of an Absolute Rate Auction, the rate of interest per 
annum (specified to the nearest 1/10,000th of 1%) (the "Money Market Absolute 
Rate") offered for each such Money Market Loan, and

     (E)  the identity of the quoting Bank.

A Money Market Quote may set forth up to five separate offers by the quoting 
Bank with respect to each Interest Period specified in the related Invitation 
for Money Market Quotes.

                                          16

<PAGE>

     (iii)  Any Money Market Quote shall be disregarded if it:

     (A)  is not substantially in conformity with Exhibit D hereto or does 
not specify all of the information required by subsection (d)(ii);

     (B)  contains qualifying, conditional or similar language;

     (C)  proposes terms other than or in addition to those set forth in the 
applicable Invitation for Money Market Quotes; or

     (D)  arrives after the time set forth in subsection (d)(i).

     (e)  Notice to Borrower.  The Agent shall promptly (and in any event no 
later than 11:00 A.M. (New York time) on (i) the third Euro-Dollar Business 
Day prior to the proposed date of Borrowing, in the case of a LIBOR Auction 
or (ii) the proposed date of Borrowing, in the case of an Absolute Rate 
Auction) notify the Borrower of the terms (x) of any Money Market Quote 
submitted by a Bank that is in accordance with subsection (d) and (y) of any 
Money Market Quote that amends, modifies or is otherwise inconsistent with a 
previous Money Market Quote submitted by such Bank with respect to the same 
Money Market Quote Request.  Any such subsequent Money Market Quote shall be 
disregarded by the Agent unless such subsequent Money Market Quote is 
submitted solely to correct a manifest error in such former Money Market 
Quote.  The Agent's notice to the Borrower shall specify (A) the aggregate 
principal amount of Money Market Loans for which offers have been received 
for each Interest Period specified in the related Money Market Quote Request, 
(B) the respective principal amounts and Money Market Margins or Money Market 
Absolute Rates, as the case may be, so offered and (C) if applicable, 
limitations on the aggregate principal amount of Money Market Loans for which 
offers in any single Money Market Quote may be accepted.

     (f)  Acceptance and Notice by Borrower.  Not later than 11:15 A.M. (New 
York City time) on (x) the third Euro-Dollar Business Day prior to the 
proposed date of Borrowing, in the case of a LIBOR Auction or (y) the 
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in 
either case, such other time or date as the Company and the Agent shall have 
mutually agreed and shall have notified to the Banks not later than the date 
of the Money Market Quote Request for the first LIBOR Auction or Absolute 
Rate Auction for which such change is to be effective), the Borrower shall 
notify the Agent of its acceptance or non-acceptance of the offers so 
notified to it pursuant to subsection (e).  In the case of acceptance, such 
notice (a "Notice of Money Market Borrowing") shall specify the aggregate 
principal amount of offers for each Interest Period that are

                                          17

<PAGE>

accepted.  The Borrower may accept any Money Market Quote in whole or in 
part; provided that:

     (i)  the aggregate principal amount of each Money Market Borrowing may 
not exceed the applicable amount set forth in the related Money Market Quote 
Request,

     (ii)  the principal amount of each Money Market Borrowing must be 
$25,000,000 or a larger multiple of $5,000,000,

     (iii)  acceptance of offers may only be made on the basis of ascending 
Money Market Margins or Money Market Absolute Rates, as the case may be, and

     (iv)  the Borrower may not accept any offer that is described in 
subsection (d)(iii) or that otherwise fails to comply with the requirements 
of this Agreement.

    (g)  Allocation by Agent.  If offers are made by two or more Banks with 
the same Money Market Margins or Money Market Absolute Rates, as the case may 
be, for a greater aggregate principal amount than the amount in respect of 
which such offers are accepted for the related Interest Period, the principal 
amount of Money Market Loans in respect of which such offers are accepted 
shall be allocated by the Agent among such Banks as nearly as possible (in 
multiples of $1,000,000, as the Agent may deem appropriate) in proportion to 
the aggregate principal amounts of such offers. Determinations by the Agent 
of the amounts of Money Market Loans shall be conclusive in the absence of 
manifest error.

     Section 2.04 Notice to Banks; Funding of Loans. (a) Upon receipt of a 
Notice of Borrowing, the Agent shall promptly notify each Bank of the 
contents thereof and of such Bank's share (if any) of such Borrowing and such 
Notice of Borrowing shall not thereafter be revocable by the Borrower.

     (b)  Not later than 1:00 P.M. (New York City time) on the date of each 
Borrowing, each Bank participating therein shall (except as provided in 
subsection (c) of this Section) make available its share of such Borrowing, 
in Federal or other funds immediately available in New York City, to the 
Agent at its address referred to in Section 10.01.  Unless any applicable 
condition specified in Article 3 has not been satisfied, as determined by the 
Agent in accordance with Article 3, the Agent will make the funds so received 
from the Banks immediately available to the Borrower at the Agent's aforesaid 
address.

                                          18

<PAGE>

     (c)  If any Bank makes a new Loan hereunder to the Borrower on a day on 
which the Borrower is to repay all or any part of an outstanding Loan from 
such Bank, such Bank shall apply the proceeds of its new Loan to make such 
repayment and only an amount equal to the difference (if any) between the 
amount being borrowed by the Borrower and the amount being repaid shall be 
made available by such Bank to the Agent as provided in subsection (b) of 
this Section, or remitted by the Borrower to the Agent as provided in Section 
2.12, as the case may be.

     (d)  Unless the Agent shall have received notice from a Bank prior to 
the date of any Borrowing (or, in the case of a Base Rate Borrowing, prior to 
Noon (New York City time) on the date of such Borrowing) that such Bank will 
not make available to the Agent such Bank's share of such Borrowing, the 
Agent may assume that such Bank has made such share available to the Agent on 
the date of such Borrowing in accordance with subsections (b) and (c) of this 
Section 2.04 and the Agent may, in reliance upon such assumption, make 
available to the Borrower on such date a corresponding amount. If and to the 
extent that such Bank shall not have so made such share available to the 
Agent, such Bank and the Borrower severally agree to repay to the Agent 
forthwith on demand such corresponding amount together with interest thereon, 
for each day from the date such amount is made available to the Borrower 
until the date such amount is repaid to the Agent, at (i) in the case of the 
Borrower, a rate per annum equal to the higher of the Federal Funds Rate and 
the interest rate applicable thereto pursuant to Section 2.07 and (ii) in the 
case of such Bank, the Federal Funds Rate. If such Bank shall repay to the 
Agent such corresponding amount, such amount so repaid shall constitute such 
Bank's Loan included in such Borrowing for purposes of this Agreement.  If 
the Borrower shall have repaid such corresponding amount of such Bank, such 
Bank shall reimburse the Borrower for any loss on account thereof incurred by 
the Borrower.

     Section 2.05.  Notes. (a)  The Loans of each Bank to the Borrower shall be 
evidenced by a single Note of the Borrower payable to the order of such Bank 
for the account of its Applicable Lending Office, unless such Bank requests 
otherwise, in an amount equal to the aggregate unpaid principal amount of 
such Bank's Loans to the Borrower.

     (b)  Each Bank may, by notice to the Borrower and the Agent, request 
that its Loans of a particular type to the Borrower be evidenced by a 
separate Note of the Borrower in an amount equal to the aggregate unpaid 
principal amount of such Loans.  Each such Note shall be in substantially the 
form of Exhibit A hereto with appropriate modifications to reflect the fact 
that it evidences solely Loans of the relevant type.  Each reference in this 
Agreement to a "Note" or the "Notes" of

                                          19

<PAGE>

such Bank shall be deemed to refer to and include any or all of such Notes, 
as the context may require.

     (c)  Upon receipt of each Bank's Note pursuant to Section 3.01, the 
Agent shall forward such Note to such Bank.  Each Bank shall record the date, 
amount and type of each Loan made by it to the Borrower and the date and 
amount of each payment of principal made with respect thereto, and may, if 
such Bank so elects in connection with any transfer or enforcement of its 
Note of the Borrower, endorse on the schedule forming a part thereof 
appropriate notations to evidence the foregoing information with respect to 
each such Loan to the Borrower then outstanding; provided that the failure of 
any Bank to make any such recordation or endorsement shall not affect the 
obligations of the Borrower hereunder or under the Notes.  Each Bank is 
hereby irrevocably authorized by the Borrower so to endorse its Notes and to 
attach to and make a part of any Note a continuation of any such schedule as 
and when required.

    Section 2.06.  Maturity of Loans. Each Loan by a Bank included in any 
Borrowing made pursuant to Ssection 2.01(a) shall mature, and the principal 
amount thereof shall be due and payable, together with accrued interest 
thereon, on the Termination Date for such Bank.  Each Loan included in any 
Borrowing made pursuant to Section 2.03 shall mature, and the principal 
amount thereof shall be due and payable, together with accrued interest 
thereon, on the last day of the Interest Period applicable thereto.

     Section 2.07.  Interest Rates. (a)  Each Domestic Loan shall bear 
interest on the outstanding principal amount thereof, for each day from the 
date such Loan is made until it becomes due, at a rate per annum equal to the 
Base Rate for such day.  Such interest shall be payable quarterly in arrears 
on the last day of each calendar quarter and, with respect to the principal 
amount of any Domestic Loan converted to a Euro-Dollar Loan, on each date a 
Domestic Loan is so converted.  Any overdue principal of or interest on any 
Domestic Loan shall bear interest, payable on demand, for each day until paid 
at a rate per annum equal to the sum of 2% plus the rate otherwise applicable 
to Domestic Loans for such day.

     (b)  Each Euro-Dollar Loan shall bear interest on the outstanding 
principal amount thereof, for the Interest Period applicable thereto, at a 
rate per annum equal to the sum of the Euro-Dollar Margin plus the applicable 
Adjusted London Interbank Offered Rate.  Such interest shall be payable for 
each Interest Period on the last day thereof and, if such Interest Period is 
longer than three months, at intervals of three months after the first day 
thereof.

                                          20

<PAGE>

     The "Adjusted London Interbank Offered Rate" applicable to any Interest 
Period means a rate per annum equal to the quotient obtained (rounded upward, 
if necessary, to the next higher 1/100 of 1%) by dividing (i) the applicable 
London Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar Reserve 
Percentage.

     "Euro-Dollar Margin" means a rate per annum determined in accordance 
with the Pricing Schedule.

     The "London Interbank Offered Rate" applicable to any Interest Period 
means the average (rounded upward, if necessary, to the next higher 1/16 of 
1%) of the respective rates per annum at which deposits in dollars are 
offered to each of the Euro-Dollar Reference Banks in the London interbank 
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business 
Days before the first day of such Interest Period in an amount approximately 
equal to the principal amount of the Euro-Dollar Loan of such Euro-Dollar 
Reference Bank to which such Interest Period is to apply and for a period of 
time comparable to such Interest Period.

     "Euro-Dollar Reserve Percentage" means for any day that percentage 
(expressed as a decimal) which is in effect on such day, as prescribed by the 
Board of Governors of the Federal Reserve System (or any successor) for 
determining the maximum reserve requirement for a member bank of the Federal 
Reserve System in New York City with deposits exceeding five billion dollars 
in respect of "Eurocurrency liabilities" (or in respect of any other category 
of liabilities which includes deposits by reference to which the interest 
rate on Euro-Dollar Loans is determined or any category of extensions of 
credit or other assets which includes loans by a non-United States office of 
any Bank to United States residents).  The Adjusted London Interbank Offered 
Rate shall be adjusted automatically on and as of the effective date of any 
change in the Euro-Dollar Reserve Percentage.

     (c)  Any overdue principal of or interest on any Euro-Dollar Loan shall 
bear interest, payable on demand, for each day from and including the date 
payment thereof was due to but excluding the date of actual payment, at a 
rate per annum equal to the sum of 2% plus the higher of (i) the Euro-Dollar 
Margin plus the quotient obtained (rounded upward, if necessary, to the next 
higher 1/100 of 1%) by dividing (x) the average (rounded upward, if 
necessary, to the next higher 1/16 of 1%) of the respective rates per annum 
at which one day (or, if such amount due remains unpaid more than three 
Euro-Dollar Business Days, then for such other period of time not longer than 
six months as the Agent may select) deposits in dollars in an amount 
approximately equal to such overdue payment due to each of the Euro-Dollar 
Reference Banks are offered to such Euro-Dollar

                                          21

<PAGE>

Reference Bank in the London interbank market for the applicable period 
determined as provided above by (y) 1.00 minus the Euro-Dollar Reserve 
Percentage (or, if the circumstances described in clause (a) or (b) of 
Section 8.01 shall exist, at a rate per annum equal to the sum of 2% plus the 
rate applicable to Domestic Loans for such day) and (ii) the sum of the 
Euro-Dollar Margin plus the Adjusted London Interbank Offered Rate applicable 
to such Loan at the date such payment was due.

     (d)  Subject to Section 8.01, each Money Market LIBOR Loan shall bear 
interest on the outstanding principal amount thereof, for the Interest Period 
applicable thereto, at a rate per annum equal to the sum of the London 
Interbank Offered Rate for such Interest Period (determined in accordance 
with Section 2.07(b) as if the related Money Market LIBOR Borrowing were a 
Committed Euro-Dollar Borrowing) plus (or minus) the Money Market Margin 
quoted by the Bank making such Loan in accordance with Section 2.03.  Each 
Money Market Absolute Rate Loan shall bear interest on the outstanding 
principal amount thereof, for the Interest Period applicable thereto, at a 
rate per annum equal to the Money Market Absolute Rate quoted by the Bank 
making such Loan in accordance with Section 2.03.  Such interest shall be 
payable for each Interest Period on the last day thereof and, if such 
Interest Period is longer than three months, at intervals of three months 
after the first day thereof.  Any overdue principal of or interest on any 
Money Market Loan shall bear interest, payable on demand, for each day until 
paid at a rate per annum equal to the sum of 2% plus the Base Rate for such 
day.

     (e)  The Agent shall determine each interest rate applicable to the 
Loans hereunder. The Agent shall give prompt notice to the Borrower and the 
participating Banks of each rate of interest so determined, and its 
determination thereof shall be conclusive in the absence of manifest error.

     (f)  Each Euro-Dollar Reference Bank agrees to use its best efforts to 
furnish quotations to the Agent as contemplated hereby.  If any Euro-Dollar 
Reference Bank does not furnish a timely quotation, the Agent shall determine 
the relevant interest rate on the basis of the quotation or quotations 
furnished by the remaining Euro-Dollar Reference Bank or Banks or, if none of 
such quotations is available on a timely basis, the provisions of Section 
8.01 shall apply.

     Section 2.08. Facility Fees. The Company shall pay to the Agent for the 
account of the Banks ratably a facility fee at the Facility Fee Rate 
(determined daily in accordance with the Pricing Schedule).  Such facility 
fee shall accrue (i) from and including the earlier of the Closing Date and 
December 31, 1996 to but excluding the Termination Date (or earlier date of 
termination of the

                                          22

<PAGE>

Commitments in their entirety), on the daily average aggregate amount of the 
Commitments (whether used or unused) and (ii) from and including the 
Termination Date (or earlier date of termination of the Commitments in their 
entirety) to but excluding the date the Loans shall be repaid in their 
entirety, on the daily average aggregate outstanding principal amount of the 
Loans. Accrued facility fees shall be payable quarterly in arrears on the 
last day of each calendar quarter and upon the date of termination of the 
Commitments in their entirety (and, if later, the date the Loans shall be 
repaid in their entirety).

     "Facility Fee Rate" means a rate per annum determined in accordance with 
the Pricing Schedule.

     Section 2.09.  Optional Termination or Reduction of Commitments. During 
the Revolving Credit Period, the Company may, upon at least three Domestic 
Business Days' notice to the Agent, (i) terminate the Commitments at any 
time, if no Loans are outstanding at such time or (ii) ratably reduce from 
time to time by an aggregate amount of $25,000,000 or any larger multiple of 
$5,000,000, the aggregate amount of the Commitments in excess of the 
aggregate outstanding principal amount of the Loans.

     Section 2.10.  Method of Electing Interest Rates. (a)  The Loans included 
in each Committed Borrowing shall bear interest initially at the type of rate 
specified by the Borrower in the applicable Notice of Committed Borrowing.  
Thereafter, the Borrower may from time to time elect to change or continue 
the type of interest rate borne by each Group of Loans (subject in each case 
to the provisions of Article 8), as follows:

          (i)  if such Loans are Domestic Loans, the Borrower may elect to 
convert such Loans to Euro-Dollar Loans as of any Euro-Dollar Business Day;

          (ii)  if such Loans are Euro-Dollar Loans, the Borrower may elect 
to convert such Loans to Domestic Loans or elect to continue such Loans as 
Euro-Dollar Loans for an additional Interest Period, in each case effective 
on the last day of the then current Interest Period applicable to such Loans.

Each such election shall be made by delivering a notice (a "Notice of 
Interest Rate Election") to the Agent at least three Euro-Dollar Business 
Days before the conversion or continuation selected in such notice is to be 
effective.  A Notice of Interest Rate Election may, if it so specifies, apply 
to only a portion of the aggregate principal amount of the relevant Group of 
Loans; provided that (i) such

                                          23

<PAGE>

portion is allocated ratably among the Loans comprising such Group and (ii) 
the portion to which such Notice applies, and the remaining portion to which 
it does not apply, are each $25,000,000 or any larger multiple of $5,000,000.

     (b)  Each Notice of Interest Rate Election shall specify:

     (i)  the Group of Loans (or portion thereof) to which such notice 
applies;

     (ii)  the date on which the conversion or continuation selected in such 
notice is to be effective, which shall comply with the applicable clause of 
subsection (a) above;

     (iii)  if the Loans comprising such Group are to be converted, the new 
type of Loans and, if such new Loans are Euro-Dollar Loans, the duration of 
the initial Interest Period applicable thereto; and

     (iv) if such Loans are to be continued as Euro-Dollar Loans for an 
additional Interest Period, the duration of such additional Interest Period.

Each Interest Period specified in a Notice of Interest Rate Election shall 
comply with the provisions of the definition of Interest Period.

     (c)  Upon receipt of a Notice of Interest Rate Election from the 
Borrower pursuant to subsection (a) above, the Agent shall promptly notify 
each Bank of the contents thereof and such notice shall not thereafter be 
revocable by such Borrower.  If the Borrower fails to deliver a timely Notice 
of Interest Rate Election to the Agent for any Group of Euro-Dollar Loans, 
such Loans shall be converted into Domestic Loans on the last day of the then 
current Interest Period applicable thereto.

     Section 2.11.  Optional Prepayments.

     (a)  The Borrower may, upon at least one Domestic Business Day's notice 
to the Agent, prepay the Group of Domestic Loans (or any Money Market 
Borrowing bearing interest at the Base Rate pursuant to Section 8.01(a)) in 
whole at any time, or from time to time in part in amounts aggregating 
$25,000,000 or any larger multiple of $5,000,000, by paying the principal 
amount to be prepaid together with accrued interest thereon to the date of 
prepayment.

     (b)  The Borrower may, upon at least three Euro-Dollar Business Days' 
notice to the Agent, in the case of a Group of Euro-Dollar Loans, prepay the

                                          24

<PAGE>

Loans comprising such a Group on the last day of any Interest Period 
applicable to such Group, in whole at any time, or from time to time in part 
in amounts aggregating $25,000,000 or any larger multiple of $5,000,000, by 
paying the principal amount to be prepaid together with accrued interest 
thereon to the date of prepayment.

     (c)  Except as provided in subsection (a) above, the Borrower may not 
prepay all or any portion of the principal  amount of any Money Market Loan 
prior to the maturity thereof.

     (d)  Upon receipt of a notice of prepayment pursuant to this Section, 
the Agent shall promptly notify each Bank of the contents thereof and of such 
Bank's ratable share (if any) of such prepayment and such notice shall not 
thereafter be revocable by the Borrower.  Each such prepayment shall be 
applied to prepay ratably the Loans of the several Banks included in the 
relevant Group or Borrowing.

     Section 2.12.  General Provisions as to Payments. (a)  The Borrower 
shall make each payment of principal of, and interest on, the Loans and of 
fees and other amounts payable hereunder, not later than 12:00 Noon (New York 
City time) on the date when due, in Federal or other funds immediately 
available in New York City, without off set or counterclaim, to the Agent at 
its address referred to in Section 10.01.  The Agent will promptly distribute 
to each Bank its ratable share of each such payment received by the Agent for 
the account of the Banks.  Whenever any payment of principal of, or interest 
on, the Domestic Loans or of fees or other amounts payable hereunder shall be 
due on a day which is not a Domestic Business Day, the date for payment 
thereof shall be extended to the next succeeding Domestic Business Day.  
Whenever any payment of principal of, or interest on, the Euro-Dollar Loans 
shall be due on a day which is not a Euro-Dollar Business Day, the date for 
payment thereof shall be extended to the next succeeding Euro-Dollar Business 
Day unless such Euro-Dollar Business Day falls in another calendar month, in 
which case the date for payment thereof shall be the next preceding 
Euro-Dollar Business Day.  Whenever any payment of principal of, or interest 
on, the Money Market Loans shall be due on a day which is not a Euro-Dollar 
Business Day, the date for payment thereof shall be extended to the next 
succeeding Euro-Dollar Business Day.  If the date for any payment of 
principal is extended by operation of law or otherwise, interest thereon 
shall be payable for such extended time.

     (b)  Unless the Agent shall have received notice from the Borrower prior 
to the date on which any payment is due from the Borrower to the Banks 
hereunder that the Borrower will not make such payment in full, the Agent may 

                                       25
<PAGE>

assume that the Borrower has made such payment in full to the Agent on such 
date and the Agent may, in reliance upon such assumption, cause to be 
distributed to each Bank on such due date an amount equal to the amount then 
due such Bank.  If and to the extent that the Borrower shall not have so made 
such payment, each Bank shall repay to the Agent forthwith on demand such 
amount distributed to such Bank together with interest thereon, for each day 
from the date such amount is distributed to such Bank until the date such 
Bank repays such amount to the Agent, at the Federal Funds Rate.

     Section 2.13. Funding Losses.  If the Borrower makes any payment of 
principal with respect to any Fixed Rate Loan or any Fixed Rate Loan is 
converted to a Domestic Loan (pursuant to Article 6 or 8 or otherwise) on any 
day other than the last day of an Interest Period applicable thereto, or the 
last day of an applicable period fixed pursuant to Section 2.07(c), or if the 
Borrower fails to borrow or prepay any Fixed Rate Loans after notice has been 
given to any Bank in accordance with Section 2.04(a) or 2.11(d), the Company 
shall reimburse each Bank within 15 days after demand for any resulting loss 
or expense incurred by it (or by an existing or prospective Participant in 
the related Loan), including (without limitation) any loss incurred in 
obtaining, liquidating or employing deposits from third parties, but 
excluding loss of margin for the period after any such payment or conversion 
or failure to borrow or prepay, provided that such Bank shall have delivered 
to the Company a certificate as to the amount of such loss or expense, which 
certificate shall be conclusive in the absence of manifest error.

     Section 2.14 Computation Of Interest And Fees.  Interest based on the 
Prime Rate hereunder shall be computed on the basis of a year of 365 days (or 
366 days in a leap year) and paid for the actual number of days elapsed 
(including the first day but excluding the last day).  All other interest and 
fees hereunder shall be computed on the basis of a year of 360 days and paid 
for the actual number of days elapsed (including the first day but excluding 
the last day).

     Section 2.15. Change Of Control. If a Change of Control shall occur, the 
Company will, within ten days after the occurrence thereof, give each Bank 
notice thereof, which notice shall describe in reasonable details the facts 
and circumstances giving rise thereto and shall specify an Optional 
Termination Date for purposes of this Section (the "Optional Termination 
Date") which date shall not be less than 30 nor more than 60 days after the 
date of such notice.  Each Bank may, by notice to the Company and the Agent 
given not less than three Domestic Business Days prior to the Optional 
Termination Date, terminate its Commitment (if any), which shall thereupon be 
terminated, and declare the Note held by it (together with accrued interest 
thereon) and any other amounts payable


                                      26
<PAGE>

hereunder for its account to be, and such Note and such other amounts shall 
thereupon become, due and payable without presentment, demand, protest or 
other notice of any kind, all of which are hereby waived by the Company and 
the Borrower, in each case effective on the Optional Termination Date.

    A "Change of Control" shall occur if any person or group of persons 
(within the meaning of Section 13 or 14 of the Securities Exchange Act of 
1934, as amended) shall have acquired beneficial ownership (within the 
meaning of Rule 13d-3 promulgated by the Securities and Exchange Commission 
under said Act) of 30% or more of the outstanding shares of common stock of 
the Company; or, during any period of twelve consecutive calendar months, 
individuals who were directors of the Company on the first day of such period 
shall cease to constitute a majority of the board of directors of the Company.


                                  ARTICLE 3
                                 Conditions

     Section 3.01. Closing.  The closing hereunder shall occur upon receipt 
by the Agent of the following documents, each dated the Closing Date unless 
otherwise indicated:

    (a) a duly executed Note of the Borrower for the account of each Bank 
dated on or before the Closing Date complying with the provisions of Section 
2.05;

    (b)  an opinion of Stephen E. Brilz, Esq., counsel for the Company and 
the Borrower, substantially in the form of Exhibit E hereto and covering such 
additional matters relating to the transactions contemplated hereby as the 
Required Banks may reasonably request;

    (c)  an opinion of Davis Polk & Wardwell, special counsel for the Agent, 
substantially in the form of Exhibit F hereto and covering such additional 
matters relating to the transactions contemplated hereby as the Required 
Banks may reasonably request; 

    (d)  evidence satisfactory to the Agent that the commitments under the 
Existing Credit Agreements have been terminated and that the principal and 
interest on all loans and accrued fees outstanding thereunder have been paid 
in full; 

                                     27
<PAGE>

    (e) evidence satisfactory to the Agent that all conditions to the 
consummation of the Acquisition have been satisfied; and

    (f)  all documents the Agent may reasonably request relating to the 
existence of the Company, the corporate authority for and the validity of 
this Agreement and the Notes, and any other matters relevant hereto, all in 
form and substance satisfactory to the Agent.

The Agent shall promptly notify the Company and the Banks of the Closing 
Date, and such notice shall be conclusive and binding on all parties hereto.

     Section 3.02 Borrowings.  The obligation of any Bank to make a Loan on 
the occasion of any Borrowing is subject to the satisfaction of the following 
conditions:

    (a)  the fact that the Closing Date shall have occurred on or prior to 
February 15, 1997;

    (b)  receipt by the Agent of a Notice of Borrowing as required by Section 
2.02 or 2.03, as the case may be;

    (c)  the fact that, immediately before and after such Borrowing, the 
aggregate outstanding principal amount of the Loans will not exceed the 
aggregate amount of the Commitments;

    (d)  the fact that, immediately before and after such Borrowing, no 
Default shall have occurred and be continuing; and

    (e)  the fact that the representations and warranties contained in this 
Agreement shall be true on and as of the date of such Borrowing (except, in 
the case of the representations and warranties contained in Section 4.04(c), 
as disclosed by the Borrower to the Banks in writing in the Notice of 
Borrowing relating to such Borrowing).

     Each Borrowing hereunder shall be deemed to be a representation and 
warranty by the Borrower on the date of such Borrowing as to the facts 
specified in clauses (c), (d) and (e) of this Section.

                                      28
<PAGE>


                                   ARTICLE 4
                        Representations And Warranties

     Each of the Company and the Borrower represents and warrants that:

     Section 4.01 Corporate Existence And Power.  Each of the Company and the 
Borrower is a corporation duly incorporated, validly existing and in good 
standing under the laws of the state of its incorporation, and has all 
corporate powers and all material governmental licenses, authorizations, 
qualifications, consents and approvals required to carry on its business as 
now conducted.

     Section 4.02. Corporate And Governmental Authorization; No 
Contravention. The execution, delivery and performance by the Company and the 
Borrower of this Agreement and by the Borrower of the Notes are within such 
Person's corporate powers, have been duly authorized by all necessary 
corporate action, require no action by or in respect of, or filing with, any 
governmental body, agency or official and do not contravene, or constitute a 
default under, any provision of applicable law or regulation or of the 
certificate of incorporation or by-laws of such Person or of any agreement, 
judgment, injunction, order, decree or other instrument binding upon such 
Person or any Significant Subsidiary or result in the creation or imposition 
of any Lien on any material asset of such Person or any Significant 
Subsidiary.

     Section 4.03. Binding Effect.  This Agreement constitutes a valid and 
binding agreement of the Company and the Borrower, and the Notes, when 
executed and delivered in accordance with this Agreement, will constitute 
valid and binding obligations of the Borrower.

     Section 4.04. Financial Information

     (a)  The consolidated  balance sheet of the Company and its Consolidated 
Subsidiaries as of December 31, 1995 and the related consolidated statements 
of income and cash flows for the fiscal year then ended, reported on by 
Coopers & Lybrand and set forth in the Company's 1995 Form 10-K, a copy of 
which has been delivered to each of the Banks, fairly present, in conformity 
with generally accepted accounting principles, the consolidated financial 
position of the Company and its Consolidated Subsidiaries as of such date and 
their consolidated results of operations and cash flows for such fiscal year.

    (b)  The unaudited consolidated balance sheet of the Company and its 
Consolidated Subsidiaries as of June 30, 1996 and the related unaudited 
consolidated statements of income and cash flows for the six months then 
ended,

                                     29
<PAGE>


set forth in the Company's quarterly report for the fiscal quarter ended June 
30, 1996 as filed with the Securities and Exchange Commission on Form 10-Q, a 
copy of which has been delivered to each of the Banks, fairly present, in 
conformity with generally accepted accounting principles applied on a basis 
consistent with the financial statements referred to in subsection (a) of 
this Section, the consolidated financial position of the Company and its 
Consolidated Subsidiaries as of such date and their consolidated results of 
operations and cash flows for such six month period (subject to normal 
year-end adjustments).

     (c)  Since June 30, 1996 there has been no material adverse change in 
the financial position or results of operations of the Company and its 
Consolidated Subsidiaries, considered as a whole (it being understood that 
the consummation of the Acquisition shall not be considered such a change).

     Section 4.05. Litigation. Except as disclosed in the Company's 1995 Form 
10-K and quarterly report for the fiscal quarter ended June 30, 1996 as filed 
with the Securities and Exchange Commission on Form 10-Q, there is no action, 
suit or proceeding pending against, or to the knowledge of the Company 
threatened against or affecting, the Company or any of its Subsidiaries 
before any court or arbitrator or any governmental body, agency or official 
in which there is a reasonable possibility of an adverse decision which would 
materially adversely affect the consolidated financial position or 
consolidated results of operations of the Company and its Consolidated 
Subsidiaries, considered as a whole, or which in any manner draws into 
question the validity of this Agreement or the Notes.

    Section 4.06. Compliance With Erisa. Each member of the ERISA Group has 
fulfilled its obligations under the minimum funding standards of ERISA and 
the Internal Revenue Code with respect to each Plan and is in compliance in 
all respects with the presently applicable provisions of ERISA and the 
Internal Revenue Code with respect to each Plan, except where failure to 
comply would not have a material adverse effect on the consolidated financial 
position or consolidated results of operations of the Company and its 
Consolidated Subsidiaries, considered as a whole.  No member of the ERISA 
Group has (i) sought a waiver of the minimum funding standard under Section 
412 of the Internal Revenue Code in respect of any Plan, (ii) failed to make 
any contribution or payment to any Plan or Multiemployer Plan or in respect 
of any Benefit Arrangement, or made any amendment to any Plan or Benefit 
Arrangement, which has resulted or could result in the imposition of a Lien 
or the posting of a bond or other security under ERISA or the Internal 
Revenue Code or (iii) incurred any liability under Title IV of ERISA other 
than a liability to the PBGC for premiums under Section 4007 of ERISA.

                                      30
<PAGE>


     Section 4.07. Environmental Matters. (a)  The operations of the Company 
and each of its Subsidiaries comply in all respects with all Environmental 
Laws except such non-compliance which would not (if enforced in accordance 
with applicable law) reasonably be expected to result, individually or in the 
aggregate, in a material adverse effect on the financial position or results 
of operations of the Company and its Consolidated Subsidiaries, considered as 
a whole.

     (b)  Except as specifically identified in Schedule 4.07, the Company and 
each of its Subsidiaries have obtained all material licenses, permits, 
authorizations and registrations required under any Environmental Laws 
("Environmental Permits") necessary for their respective operations, and all 
such Environmental Permits are in good standing, and the Company and each of 
its Subsidiaries is in compliance with all material terms and conditions of 
such Environmental Permits.

     (c)  Except as specifically identified in Schedule 4.07, (i) none of the 
Company, any of its Subsidiaries or any of their present property or 
operations are subject to any outstanding written order from or settlement or 
consent agreement with any governmental authority or other Person, nor is any 
of the foregoing subject to any judicial or docketed administrative 
proceedings, respecting any Environmental Laws or Hazardous Substances with a 
potential liability in excess of $1,000,000 and (ii) there are no other 
conditions or circumstances known to the Company which may give rise to any 
claims respecting any Environmental Laws arising from the operations of the 
Company or its Subsidiaries (including, without limitation, off-site 
liabilities), or any additional costs of compliance with Environmental Laws, 
that would reasonably be expected to have a material adverse effect on the 
financial position or results of operations of the Company and its 
Subsidiaries, considered as a whole.

     Section 4.08. Taxes.  United States Federal income tax returns of the 
Company and its Subsidiaries have been examined and closed through the fiscal 
year ended December 31, 1987.  The Company and its Subsidiaries have filed 
all United States Federal income tax returns and all other material tax 
returns which are required to be filed by them and have paid all taxes due 
pursuant to such returns or pursuant to any assessment received by the 
Company or any Subsidiary, except for taxes the amount, applicability or 
validity of which is being contested in good faith by appropriate 
proceedings.  The charges, accruals and reserves on the books of the Company 
and its Subsidiaries in respect of taxes or other governmental charges are, 
in the opinion of the Company, adequate.

    Section 4.09. Subsidiaries.  Each of the Company's corporate Significant 
Subsidiaries (including, but not limited to, the Borrower) is a

                                     31
<PAGE>


corporation duly incorporated, validly existing and in good standing under 
the laws of its jurisdiction of incorporation, and has all corporate powers 
and all material governmental licenses, authorizations, qualifications, 
consents and approvals required to carry on its business as now conducted.

     Section 4.10. Not An Investment Company. Neither the Company nor the 
Borrower is an "investment company" within the meaning of the Investment 
Company Act of 1940, as amended.


     Section 4.11. Full Disclosure. All written information heretofore 
furnished by the Company or the Borrower to the Agent or any Bank for 
purposes of or in connection with this Agreement or any transaction 
contemplated hereby is, and all such information hereafter furnished by the 
Company or the Borrower to the Agent or any Bank will be, true and accurate 
in all material respects on the date as of which such information is stated 
or certified.


                                  ARTICLE 5
                                  Covenants

     The Company agrees that, so long as any Bank has any Commitment 
hereunder or any amount payable under any Note remains unpaid:

     Section 5.01. Information.  The Company will deliver to each of the 
Banks:

     (a)  as soon as available and in any event within 95 days after the end 
of each fiscal year of the Company, a consolidated balance sheet of the 
Company and its Consolidated Subsidiaries as of the end of such fiscal year 
and the related consolidated statements of income and cash flows for such 
fiscal year, setting forth in each case in comparative form the figures for 
the previous fiscal year, all reported on in a manner acceptable to the 
Securities and Exchange Commission by Arthur Andersen L.L.P. or other 
independent public accountants of nationally recognized standing;

     (b)  as soon as available and in any event within 50 days after the end 
of each of the first three quarters of each fiscal year of the Company, a 
consolidated balance sheet of the Company and its Consolidated Subsidiaries 
as of the end of such quarter and the related consolidated 

                                      32
<PAGE>


statements of income and cash flows for such quarter and for the portion of 
the Company's fiscal year ended at the end of such quarter, setting forth in 
the case of such statements of income and cash flows in comparative form the 
figures for the corresponding quarter and the corresponding portion of the 
Company's previous fiscal year, all certified (subject to normal year-end 
adjustments) as to fairness of presentation, generally accepted accounting 
principles and consistency by the chief financial officer or the chief 
accounting officer of the Company;

     (c)  simultaneously with the delivery of each set of financial 
statements referred to in clauses (a) and (b) above, a certificate of the 
chief financial officer (or such officer's designee, designated in writing by 
such officer) or the chief accounting officer of the Company (i) setting 
forth in reasonable detail the calculations required to establish whether the 
Company was in compliance with the requirements of Sections 5.06 to 5.08, 
inclusive, on the date of such financial statements and (ii) stating whether 
any Default exists on the date of such certificate and, if any Default then 
exists, setting forth the details thereof and the action which the Company is 
taking or proposes to take with respect thereto;

    (d)  within five Domestic Business Days after any officer of the Company 
or the Borrower obtains knowledge of any Default, if such Default is then 
continuing, a certificate of the chief financial officer or the chief 
accounting officer of the Company or the Borrower setting forth the details 
thereof and the action which the Company or the Borrower is taking or 
proposes to take with respect thereto;

    (e)  promptly upon the mailing thereof to the shareholders of the Company 
generally, copies of all financial statements, reports and proxy statements 
so mailed;

    (f)  promptly upon the filing thereof, copies of all registration 
statements (other than the exhibits thereto and any registration statements 
on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or 
their equivalents) (other than any amendment on Form 8-K the sole purpose of 
which is to file exhibits relating to existing Debt meeting the requirements 
of clause (ii) of the definition of Debt) which the Company shall have filed 
with the Securities and Exchange Commission;

    (g)  if and when any member of the ERISA Group (i) gives or is required 
to give notice to the PBGC of any "reportable event" (as defined in Section 
4043 of ERISA) with respect to any Plan which might

                                        33
<PAGE>


constitute grounds for a termination of such Plan under Title IV of ERISA, or 
knows that the plan administrator of any Plan has given or is required to 
give notice of any such reportable event, a copy of the notice of such 
reportable event given or required to be given to the PBGC; (ii) receives 
notice of complete or partial withdrawal liability under Title IV of ERISA or 
notice that any Multiemployer Plan is in reorganization, is insolvent or has 
been terminated, a copy of such notice; (iii) receives notice from the PBGC 
under Title IV of ERISA of an intent to terminate, impose liability (other 
than for premiums under Section 4007 of ERISA) in respect of, or appoint a 
trustee to administer any Plan, a copy of such notice; (iv) applies for a 
waiver of the minimum funding standard under Section 412 of the Internal 
Revenue Code, a copy of such application; (v) gives notice of intent to 
terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and 
other information filed with the PBGC; (vi) gives notice of withdrawal from 
any Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) 
fails to make any payment or contribution to any Plan or Multiemployer Plan 
or in respect of any Benefit Arrangement or makes any amendment to any Plan 
or Benefit Arrangement which has resulted or could result in the imposition 
of a Lien or the posting of a bond or other security, a certificate of the 
chief financial officer or the chief accounting officer of the Company 
setting forth details as to such occurrence and action, if any, which the 
Company or applicable member of the ERISA Group is required or proposes to 
take; and

    (h)  from time to time such additional information regarding the 
financial position or business of the Company and its Subsidiaries and the 
Borrower and its Subsidiaries as the Agent, at the request of any Bank, may 
reasonably request.

    Section 5.02.  Maintenance Of Property; Insurance. (a)  The Company will 
keep, and will cause each Significant Subsidiary to keep, all property useful 
and necessary in its business in good working order and condition, ordinary 
wear and tear excepted.

   (b)  The Company will maintain, and will cause each Significant Subsidiary 
to maintain (either in the name of the Borrower or in such Significant 
Subsidiary's own name), with financially sound and responsible insurance 
companies, insurance on all their respective properties in at least such 
amounts and against at least such risks (and with such risk retention) as are 
usually insured against in the same general area by companies of established 
repute engaged in the same or a similar business; and will furnish to the 
Banks, upon request from the Agent, information presented in reasonable 
detail as to the insurance so

                                      34
<PAGE>


carried; PROVIDED THAT, in lieu of any such insurance, the Company and any 
Significant Subsidiary may maintain a system or systems of self-insurance and 
reinsurance which will accord with sound practices of similarly situated 
corporations maintaining such systems and with respect to which the Company 
or such Significant Subsidiary will maintain adequate insurance reserves, all 
in accordance with generally accepted accounting principles and in accordance 
with sound insurance principles and practice.

     Section 5.03. Maintenance Of Existence.  The Company will, and will 
cause each Significant Subsidiary to, preserve, renew and keep in full force 
and effect their respective corporate existence and their respective rights, 
privileges and franchises necessary or desirable in the normal conduct of 
business; PROVIDED that nothing in this Section 5.03 shall prohibit or 
interfere with the Company's publicly announced strategy to discontinue or 
dispose of in one or more transactions the financial services businesses of 
it or of any of its Subsidiaries.

    Section 5.04.  Compliance With Laws. The Company will comply, and will 
cause each Significant Subsidiary to comply, in all material respects with 
all applicable laws, ordinances, rules, regulations, and requirements of 
governmental authorities (including, without limitation, Environmental Laws 
and ERISA and the rules and regulations thereunder), except where the 
necessity of compliance therewith is contested in good faith by appropriate 
proceedings and for which adequate reserves in conformity with generally 
accepted accounting principles have been established.

    Section 5.05.  Inspection Of Property, Books And Records.  The Company 
will keep, and will cause each Significant Subsidiary to keep, proper books 
of record and account in which full, true and correct entries shall be made 
of all dealings and transactions in relation to its business and activities; 
and will permit, and will cause each Significant Subsidiary to permit, 
representatives of any Bank at such Bank's expense to visit and inspect any 
of their respective properties, to examine and make abstracts from any of 
their respective books and records and to discuss their respective affairs, 
finances and accounts with their respective officers, employees and 
independent public accountants, all at such reasonable times and as often as 
may reasonably be desired.

     Section 5.06. Subsidiary Debt.  Total Debt of all Consolidated 
Subsidiaries (excluding Debt of a Consolidated Subsidiary to the Company or 
to a Wholly-Owned Consolidated Subsidiary) will at no time exceed 250% of 
Consolidated Net Worth.  For purposes of this Section, any preferred stock of 
a Consolidated Subsidiary other than the Borrower which is held by a Person 
other than the Company or a Wholly-Owned Consolidated Subsidiary shall be 
included,

                                     35
<PAGE>


at the higher of its voluntary or involuntary liquidation value, in the Debt 
of such Consolidated Subsidiary.

    Section 5.07.  Debt Coverage.  Consolidated Debt of the Company and its 
Consolidated Subsidiaries will at all times be less than 70% of the sum of 
consolidated Debt of the Company and its Consolidated Subsidiaries and 
consolidated shareowners' equity of the Company and its Consolidated 
Subsidiaries.

     Section 5.08.  Negative Pledge. Neither the Company nor the Borrower 
will, and the Company will not permit any Subsidiary to, create, assume or 
suffer to exist any Lien on any asset now owned or hereafter acquired by it, 
except: 

     (a)  Liens existing on the date of this Agreement securing Debt 
outstanding on the date of this Agreement in an aggregate principal amount 
not exceeding $123,700,000;

     (b)  any Lien existing on any asset of any corporation at the time such 
corporation becomes a Subsidiary and not created in contemplation of such 
event;

     (c)  any Lien on any asset securing Debt incurred or assumed for the 
purpose of financing all or any part of the cost of acquiring such asset, 
PROVIDED that such Lien attaches to such asset concurrently with or within 
180 days after the acquisition thereof;

     (d)  any Lien on any asset of any corporation existing at the time such 
corporation is merged or consolidated with or into the Company or a 
Subsidiary and not created in contemplation of such event;

     (e)  any Lien existing on any asset prior to the acquisition thereof by 
the Company or a Subsidiary and not created in contemplation of such 
acquisition;

     (f)  any Lien on assets or capital stock of Minor Subsidiaries which 
secures Debt of Persons which are not Consolidated Subsidiaries in which the 
Company or any of its Subsidiaries has made investments ("Joint Ventures"), 
but for the payment of which Debt no other recourse may be had to the Company 
or any Subsidiaries ("Limited Recourse Debt"), or any Lien on equity 
interests in a Joint Venture securing Limited Recourse Debt of such Joint 
Venture;

                                     36
<PAGE>


     (g)  any Lien arising out of the refinancing, replacement, extension, 
renewal or refunding of any Debt secured by any Lien permitted by any of the 
foregoing clauses of this Section, provided that such Debt is not increased 
and is not secured by any additional assets;

     (h)  Liens arising in the ordinary course of business which (i) do 
not secure Debt, (ii) do not secure any obligation in an amount exceeding 
$50,000,000 and (iii) do not in the aggregate materially detract from the 
value of its assets or materially impair the use thereof in the operation of 
its business;

     (i)  Liens not otherwise permitted by and in addition to the 
foregoing clauses of this Section securing Debt in an aggregate principal 
amount at any time outstanding not to exceed 10% of Consolidated Net Worth; 
and

     (j) any Lien on Margin Stock, if and to the extent the value of all 
Margin Stock of the Company and its Subsidiaries exceeds 25% of the value of 
the total assets subject to this Section.

     Section 5.09.  Consolidations, Mergers And Sales Of Assets. The Company 
will not (i) consolidate with or merge into any other Person or (ii) sell, 
lease or otherwise transfer, directly or indirectly, all or substantially all 
of the assets of the Company and its Subsidiaries, taken as a whole, to any 
other Person.  The Company will retain ownership, directly or indirectly, of 
at least 80% of the capital stock, and at least 80% of the voting power, of U 
S WEST Communications, Inc. ("Communications"), and will cause Communications 
to continue to own substantially all of the telecommunications assets it owns 
on the date of this Agreement.  Nothing in this Section shall be construed to 
restrict any sales of Margin Stock for fair value as determined in good faith 
by the board of directors of the Company.

     Section 5.10. Use Of Proceeds. The proceeds of the Loans made under this 
Agreement will be used by the Borrower for financing the Acquisition and for 
general corporate purposes.  None of such proceeds will be used, directly or 
indirectly, in violation of any applicable law or regulation, and no use of 
such proceeds for general corporate purposes will include any use for the 
purpose, whether immediate, incidental or ultimate, of buying or carrying any 
Margin Stock.

                                      37
<PAGE>

                                  ARTICLE 6
                                  Defaults

     Section 6.01. Events Of Default. If one or more of the following events 
shall have occurred and be continuing:

     (a)  any principal of any Loan shall not be paid when due, or any 
interest, any fees or any other amount payable hereunder shall not be paid 
within five days of the due date thereof;

     (b)  the Company or the Borrower shall fail to observe or perform any 
covenant contained in Sections 5.06 to 5.10, inclusive;

     (c)  the Company or the Borrower shall fail to observe or perform any 
covenant or agreement contained in this Agreement (other than those covered 
by clause (a) or (b) above) for 10 days after written notice thereof has been 
given to the Company by the Agent at the request of any Bank;

     (d)  any representation, warranty, certification or statement made by 
the Company or the Borrower in this Agreement or in any certificate, 
financial statement or other document delivered pursuant to this Agreement 
shall prove to have been incorrect in any material respect when made (or 
deemed made);

     (e)  the Company or any Subsidiary shall fail to make any payment or 
payments, in the aggregate in excess of $100,000,000, in respect of any 
Material Debt when due or within any applicable grace period;

     (f)  any event or condition shall occur which results in the 
acceleration of the maturity of any Material Debt;

     (g)  the Company or any Significant Subsidiary shall commence a 
voluntary case or other proceeding seeking liquidation, reorganization or 
other relief with respect to itself or its debts under any bankruptcy, 
insolvency or other similar law now or hereafter in effect or seeking the 
appointment of a trustee, receiver, liquidator, custodian or other similar 
official of it or any substantial part of its property, or shall consent to 
any such relief or to the appointment of or taking possession by any such 
official in an involuntary case or other proceeding commenced against it, or 
shall make a general assignment for the benefit of creditors, or shall fail 
generally to pay its debts as they become due, or shall take any corporate 
action to authorize or otherwise acquiesce in any of the foregoing;

                                      38
<PAGE>

     (h)  an involuntary case or other proceeding shall be commenced against 
the Company or any Significant Subsidiary seeking liquidation, reorganization 
or other relief with respect to it or its debts under any bankruptcy, 
insolvency or other similar law now or hereafter in effect or seeking the 
appointment of a trustee, receiver, liquidator, custodian or other similar 
official of it or any substantial part of its property, and such involuntary 
case or other proceeding shall remain undismissed and unstayed for a period 
of 60 days; or an order for relief shall be entered against the Company or 
any Significant Subsidiary under the federal bankruptcy laws as now or 
hereafter in effect;

     (i)  any member of the ERISA Group shall fail to pay when due an amount 
or amounts aggregating in excess of $100,000,000 which it shall have become 
liable to pay under Title IV of ERISA; or notice of intent to terminate a 
Material Plan shall be filed under Title IV of ERISA by any member of the 
ERISA Group, any plan administrator or any combination of the foregoing; or 
the PBGC shall institute proceedings under Title IV of ERISA to terminate, to 
impose liability (other than for premiums under Section 4007 of ERISA) in 
respect of, or to cause a trustee to be appointed to administer any Material 
Plan; or a condition shall exist by reason of which the PBGC would be 
entitled to obtain a decree adjudicating that any Material Plan must be 
terminated; or there shall occur a complete or partial withdrawal from, or a 
default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, 
one or more Multiemployer Plans which could cause one or more members of the 
ERISA Group to incur a current payment obligation in excess of $100,000,000;

     (j)  a judgment or order for the payment of money in excess of 
$100,000,000 shall be rendered against the Company or any Subsidiary and such 
judgment or order shall continue unsatisfied and unstayed for a period of 10 
days; 

     (k)  the Company shall repudiate in writing any of its obligations under 
Article 9 or any such obligation shall be unenforceable against the Company 
in accordance with its terms, or the Company shall so assert in writing; or

     (l) (i) Continental Cablevision, Inc. shall have merged with and into 
the Company and Debt is outstanding under the Indentures, and (ii) one or 
more events or conditions shall occur which result in a default under any 
agreement or agreements in respect of any Material Debt that is subject to 
the Indentures and as a consequence of such default or defaults

                                      9
<PAGE>


the Company or any of its Subsidiaries shall make any payment or give or 
agree to give any consideration or benefit of any kind (including, without 
limitation, any increased compensation, prepayment, shortening of maturities, 
security or other credit support) to the holders of such Debt and such 
payment, consideration or benefit is determined by the Required Banks, after 
taking into account any payment, consideration or benefit made, given or 
agreed to be given by such holders to the Company or any of its Subsidiaries 
(other than a waiver of such default), to be a material benefit to the 
holders of such Debt;


then, and in every such event, the Agent shall (i) if requested by Banks 
having more than 50% in aggregate amount of the Commitments, by notice to the 
Company terminate the Commitments and they shall thereupon terminate, and/or 
(ii) if requested by Banks holding Notes evidencing more than 50% in 
aggregate principal amount of the Loans, by notice to the Company declare the 
Notes (together with accrued interest thereon) to be, and the Notes shall 
thereupon become, immediately due and payable without presentment, demand, 
protest or other notice of any kind, all of which are hereby waived by the 
Company and the Borrower; provided that in the case of any of the Events of 
Default specified in clause (g) or (h) above with respect to the Company or 
the Borrower, without any notice to the Company or the Borrower or any other 
act by the Agent or the Banks, the Commitments shall thereupon automatically 
terminate and the Notes (together with accrued interest thereon) shall become 
immediately due and payable without presentment, demand, protest or other 
notice of any kind, all of which are hereby waived by the Company and the 
Borrower.


     Section 6.02. Notice Of Default.  The Agent shall give notice to the 
Company under Section 6.01(c) promptly upon being requested to do so by any 
Bank and shall thereupon notify all the Banks thereof.

                                  ARTICLE 7
                                  The Agent

     Section 7.01. Appointment And Authorization.  Each Bank irrevocably 
appoints and authorizes the Agent to take such action as agent on its behalf 
and to exercise such powers under this Agreement and the Notes as are 
delegated to the Agent by the terms hereof or thereof, together with all such 
powers as are reasonably incidental thereto.

                                     40
<PAGE>

      Section 7.02. Agent And Affiliates. Morgan Guaranty Trust Company of 
New York shall have the same rights and powers under this Agreement as any 
other Bank and may exercise or refrain from exercising the same as though it 
were not the Agent, and Morgan Guaranty Trust Company of New York and its 
affiliates may accept deposits from, lend money to, and generally engage in 
any kind of business with the Company, the Borrower or any Subsidiary or 
affiliate of the Company or the Borrower as if it were not the Agent 
hereunder.

     Section 7.03. Action By Agent.  The obligations of the Agent hereunder 
are only those expressly set forth herein.  Without limiting the generality 
of the foregoing, the Agent shall not be required to take any action with 
respect to any Default, except as expressly provided in Article 6.

     Section 7.04. Consultation With Experts.  The Agent may consult with 
legal counsel (who may be counsel for the Company or the Borrower), 
independent public accountants and other experts selected by it and shall not 
be liable for any action taken or omitted to be taken by it in good faith in 
accordance with the advice of such counsel, accountants or experts.

    Section 7.05. Liability of Agent. Neither the Agent nor any of its 
affiliates nor any of their respective directors, officers, agents or 
employees shall be liable for any action taken or not taken by it in 
connection herewith (i) with the consent or at the request of the Required 
Banks or (ii) in the absence of its own gross negligence or willful 
misconduct.  Neither the Agent nor any of its affiliates nor any of their 
respective directors, officers, agents or employees shall be responsible for 
or have any duty to ascertain, inquire into or verify (i) any statement, 
warranty or representation made in connection with this Agreement or any 
borrowing hereunder; (ii) the performance or observance of any of the 
covenants or agreements of the Company or the Borrower; (iii) the 
satisfaction of any condition specified in Article 3, except receipt of items 
required to be delivered to the Agent; or (iv) the validity, effectiveness or 
genuineness of this Agreement, the Notes or any other instrument or writing 
furnished in connection herewith.  The Agent shall not incur any liability by 
acting in reliance upon any notice, consent, certificate, statement, or other 
writing (which may be a bank wire, telex or similar writing) believed by it 
to be genuine or to be signed by the proper party or parties. 

     Section 7.06. Indemnification.  Each Bank shall, ratably in accordance 
with its Commitment, indemnify the Agent, its affiliates and their respective 
directors, officers, agents and employees (to the extent not reimbursed by 
the Company or the Borrower) against any cost, expense (including counsel 
fees and disbursements), claim, demand, action, loss or liability (except 
such as result from

                                       41
<PAGE>


such indemnitees' gross negligence or willful misconduct) that such 
indemnitees may suffer or incur in connection with this Agreement or any 
action taken or omitted by such indemnitees hereunder.

     Section 7.07.  Credit Decision. Each Bank acknowledges that it has, 
independently and without reliance upon the Agent or any other Bank, and 
based on such documents and information as it has deemed appropriate, made 
its own credit analysis and decision to enter into this Agreement.  Each Bank 
also acknowledges that it will, independently and without reliance upon the 
Agent or any other Bank, 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 any action under this Agreement.

     Section 7.08. Successor Agent. The Agent may resign at any time by 
giving notice thereof to the Banks and the Company.  Upon any such 
resignation, the Required Banks shall have the right to appoint a successor 
Agent.  If no successor Agent shall have been so appointed by the Required 
Banks, and shall have accepted such appointment, within 30 days after the 
retiring Agent gives notice of resignation, then the retiring Agent may, on 
behalf of the Banks, appoint a successor Agent (with the consent of the 
Company, such consent not to be unreasonably withheld), which shall be a 
commercial bank organized or licensed under the laws of the United States of 
America or of any State thereof and having a combined capital and surplus of 
at least $400,000,000.  Upon the acceptance of its appointment as Agent 
hereunder by a successor Agent, such successor Agent shall thereupon succeed 
to and become vested with all the rights and duties of the retiring Agent, 
and the retiring Agent shall be discharged from its duties and obligations 
hereunder.  After any retiring Agent's resignation hereunder as Agent, the 
provisions of this Article shall inure to its benefit as to any actions taken 
or omitted to be taken by it while it was Agent. 

     Section 7.09. Agent's Fee. The Company shall pay to the Agent for its 
own account fees in the amounts and at the times previously agreed upon 
between the Company and the Agent. 

     Section 7.10. Other Agents. Neither Citibank, N.A. nor The Bank of New 
York shall have any responsibility, obligation or liability under this 
Agreement in its capacity as Syndication Agent or Documentation Agent, 
respectively.

                                      42

<PAGE>

                                    ARTICLE 8
                             Changes in Circumstances


     Section 8.01. Basis for Determining Interest Rate Inadequate or Unfair. 
If on or prior to the first day of any Interest Period for any Euro-Dollar 
Loan or Money Market LIBOR Loan:

(a)  the Agent is advised by the Euro-Dollar Reference Banks that deposits in 
dollars (in the applicable amounts) are not being offered to the Euro-Dollar 
Reference Banks in the market for such Interest Period, or

(b)  in the case of Euro-Dollar Loans, Banks having 50% or more of the 
aggregate amount of the Euro-Dollar Loans advise the Agent that the Adjusted 
London Interbank Offered Rate as determined by the Agent will not adequately 
and fairly reflect the cost to such Banks of funding their Euro-Dollar Loans 
for such Interest Period,

the Agent shall forthwith give notice thereof to the Company and the Banks, 
whereupon until the Agent notifies the Company that the circumstances giving 
rise to such suspension no longer exist, (i) the obligations of the Banks to 
make Euro-Dollar Loans or to convert outstanding Loans into Euro-Dollar Loans 
shall be suspended and (ii) each outstanding Euro-Dollar Loan shall be 
converted into a Domestic Loan on the last day of the then current Interest 
Period applicable thereto.  Unless the Borrower notifies the Agent at least 
two Domestic Business Days before the date of any Fixed Rate Borrowing for 
which a Notice of Borrowing has previously been given that it elects not to 
borrow on such date, (i) if such Fixed Rate Borrowing is a Committed 
Borrowing, such Borrowing shall instead be made as a Domestic Borrowing and 
(ii) if such Fixed Rate Borrowing is a Money Market LIBOR Borrowing, the 
Money Market LIBOR Loans comprising such Borrowing shall bear interest for 
each day from and including the first day to but excluding the last day of 
the Interest Period applicable thereto at the Base Rate for such day.

     Section 8.02. Illegality. If, on or after the date of this Agreement, 
the adoption of any applicable law, rule or regulation, or any change in any 
applicable law, rule or regulation, or any change in the interpretation or 
administration thereof by any governmental authority, central bank or 
comparable agency charged with the interpretation or administration thereof, 
or compliance by any Bank (or its Euro-Dollar Lending Office) with any 
request or directive (whether or not having the force of law) of any such 
authority, central bank or comparable agency shall make it unlawful or 
impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain 
or fund its Euro-Dollar Loans to the Borrower 

                                   43

<PAGE>

and such Bank shall so notify the Agent, the Agent shall forthwith give 
notice thereof to the other Banks and the Company, whereupon until such Bank 
notifies the Company and the Agent that the circumstances giving rise to such 
suspension no longer exist, the obligation of such Bank to make Euro-Dollar 
Loans to the Borrower, or to convert outstanding Loans into Euro-Dollar 
Loans, shall be suspended.  Before giving any notice to the Agent pursuant to 
this Section, such Bank shall designate a different Euro-Dollar Lending 
Office if such designation will avoid the need for giving such notice and 
will not, in the judgment of such Bank, be otherwise disadvantageous to such 
Bank.  If such notice is given, each Euro-Dollar Loan of such Bank then 
outstanding shall be converted to a Domestic Loan either (a) on the last day 
of the then current Interest Period applicable to such Euro-Dollar Loan if 
such Bank may lawfully continue to maintain and fund such Loan to such day or 
(b) immediately if such Bank shall determine that it may not lawfully 
continue to maintain and fund such Loan to such day.

     Section 8.03. Increased Cost and Reduced Return. (a)  If on or after (x) 
the date hereof, in the case of any Committed Loan or any obligation to make 
Committed Loans or (y) the date of the related Money Market Quote, in the 
case of any Money Market Loan, the adoption of any applicable law, rule or 
regulation, or any change in any applicable law, rule or regulation, or any 
change in the interpretation or administration thereof by any governmental 
authority, central bank or comparable agency charged with the interpretation 
or administration thereof, or compliance by any Bank (or its Applicable 
Lending Office) with any request or directive (whether or not having the 
force of law) of any such authority, central bank or comparable agency shall 
impose, modify or deem applicable any reserve (including, without limitation, 
any such requirement imposed by the Board of Governors of the Federal Reserve 
System with respect to any Euro-Dollar Loan any such requirement included in 
an applicable Euro-Dollar Reserve Percentage), special deposit, insurance 
assessment or similar requirement against assets of, deposits with or for the 
account of, or credit extended by, any Bank (or its Applicable Lending 
Office) or shall impose on any Bank (or its Applicable Lending Office) or on 
the United States market for certificates of deposit or the London interbank 
market any other condition affecting its Fixed Rate Loans, its Note or its 
obligation to make Fixed Rate Loans and the result of any of the foregoing is 
to increase the cost to such Bank (or its Applicable Lending Office) of 
making or maintaining any Fixed Rate Loan, or to reduce the amount of any sum 
received or receivable by such Bank (or its Applicable Lending Office) under 
this Agreement or under its Note with respect thereto, by an amount deemed by 
such Bank to be material, then, within 15 days after demand by such Bank 
(with a copy to the Agent), the Company shall pay to such Bank such 
additional amount or amounts as will compensate such Bank for such increased 
cost or reduction.

                                     44

<PAGE>

(b)  If any Bank shall have determined that, after the date hereof, the 
adoption of any applicable law, rule or regulation regarding capital 
adequacy, or any change in any such law, rule or regulation, or any change in 
the interpretation or administration thereof by any governmental authority, 
central bank or comparable agency charged with the interpretation or 
administration thereof, or any request or directive regarding capital 
adequacy (whether or not having the force of law) of any such authority, 
central bank or comparable agency, has or would have the effect of reducing 
the rate of return on capital of such Bank (or its Parent) as a consequence 
of such Bank's obligations hereunder to a level below that which such Bank 
(or its Parent) could have achieved but for such adoption, change, request or 
directive (taking into consideration its policies with respect to capital 
adequacy) by an amount deemed by such Bank to be material, then from time to 
time, within 15 days after demand by such Bank (with a copy to the Agent), 
the Company shall pay to such Bank such additional amount or amounts as will 
compensate such Bank (or its Parent) for such reduction.

(c)  Each Bank will promptly notify the Company and the Agent of any event of 
which it has knowledge, occurring after the date hereof, which will entitle 
such Bank to compensation pursuant to this Section and will designate a 
different Applicable Lending Office if such designation will avoid the need 
for, or reduce the amount of, such compensation and will not, in the judgment 
of such Bank, be otherwise disadvantageous to such Bank.  A certificate of 
any Bank claiming compensation under this Section and setting forth the 
additional amount or amounts to be paid to it hereunder shall be conclusive 
in the absence of manifest error.  In determining such amount, such Bank may 
use any reasonable averaging and attribution methods.

     Section 8.04. Taxes. (a)  Any and all payments by the Company or the 
Borrower to or for the account of any Bank or the Agent hereunder or under 
any Note shall be made free and clear of and without deduction for any and 
all present or future taxes, duties, levies, imposts, deductions, charges or 
withholdings, and all liabilities with respect thereto, excluding, in the 
case of each Bank and the Agent, taxes imposed on its income, and franchise 
taxes imposed on it, by the jurisdiction under the laws of which such Bank or 
the Agent (as the case may be) is organized or any political subdivision 
thereof and, in the case of each Bank, taxes imposed on its income, and 
franchise or similar taxes imposed on it, by the jurisdiction of such Bank's 
Applicable Lending Office or any political subdivision thereof (all such 
non-excluded taxes, duties, levies, imposts, deductions, charges, 
withholdings and liabilities being hereinafter referred to as "Taxes").  If 
the Company or the Borrower shall be required by law to deduct any Taxes from 
or in respect of any sum payable hereunder or under any Note to any Bank or 
the Agent, (i) the sum payable shall be increased as necessary so that after 
making all 

                                      45

<PAGE>

required deductions (including deductions applicable to additional sums 
payable under this Section 8.04) such Bank or the 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 Person shall make such deductions, (iii) such 
Person shall pay the full amount deducted to the relevant taxation authority 
or other authority in accordance with applicable law and (iv) such Person 
shall furnish to the Agent, at its address referred to in Section 10.01, the 
original or a certified copy of a receipt evidencing payment thereof.

(b)  In addition, the Company agrees to pay any present or future stamp or 
documentary taxes and any other excise or property taxes, or charges or 
similar levies which arise from any payment made hereunder or under any Note 
or from the execution or delivery of, or otherwise with respect to, this 
Agreement or any Note (hereinafter referred to as "Other Taxes").

(c)  The Company agrees to indemnify each Bank and the Agent for the full 
amount of Taxes or Other Taxes (including, without limitation, any Taxes or 
Other Taxes imposed or asserted by any jurisdiction on amounts payable under 
this Section 8.04) paid by such Bank or the Agent (as the case may be) and 
any liability (including penalties, interest and expenses) arising therefrom 
or with respect thereto.  This indemnification shall be made within 15 days 
from the date such Bank or the Agent (as the case may be) makes demand 
therefor.

(d)  Each Bank organized under the laws of a jurisdiction outside the United 
States, on or prior to the date of its execution and delivery of this 
Agreement in the case of each Bank listed on the signature pages hereof and 
on or prior to the date on which it becomes a Bank in the case of each other 
Bank, and from time to time thereafter if requested in writing by the Company 
(but only so long as such Bank remains lawfully able to do so), shall provide 
the Company with Internal Revenue Service form 1001 or 4224, as appropriate, 
or any successor form prescribed by the Internal Revenue Service, certifying 
that such Bank is entitled to benefits under an income tax treaty to which 
the United States is a party which reduces the rate of withholding tax on 
payments of interest or certifying that the income receivable pursuant to 
this Agreement is effectively connected with the conduct of a trade or 
business in the United States.  If the form provided by a Bank at the time 
such Bank first becomes a party to this Agreement indicates a United States 
interest withholding tax rate in excess of zero, withholding tax at such rate 
shall be considered excluded from "Taxes" as defined in Section 8.04(a) 
imposed by the United States.

(e)  For any period with respect to which a Bank has failed to provide the 
Company with the appropriate form pursuant to Section 8.04(d) (unless such 

                                    46

<PAGE>

failure is due to a change in treaty, law or regulation occurring subsequent 
to the date on which a form originally was required to be provided), such 
Bank shall not be entitled to indemnification under Section 8.04(a) with 
respect to Taxes imposed by the United States; provided, however, that should 
a Bank, which is otherwise exempt from or subject to a reduced rate of 
withholding tax, become subject to Taxes because of its failure to deliver a 
form required hereunder, the Company shall take such steps as such Bank shall 
reasonably request to assist such Bank to recover such Taxes.

(f)  If the Company or the Borrower is required to pay additional amounts to 
or for the account of any Bank pursuant to this Section 8.04, then such Bank 
will change the jurisdiction of its Applicable Lending Office so as to 
eliminate or reduce any such additional payment which may thereafter accrue 
if such change, in the judgment of such Bank, is not otherwise 
disadvantageous to such Bank.

     Section 8.05. Domestic Loans Substituted for Affected Euro-Dollar Loans. 
If (i) the obligation of any Bank to make Euro-Dollar Loans to the Borrower 
has been suspended pursuant to Section 8.02 or (ii) any Bank has demanded 
compensation under Section 8.03 or 8.04 with respect to its Euro-Dollar Loans 
and the Borrower shall, by at least five Euro-Dollar Business Days' prior 
notice to such Bank through the Agent, have elected that the provisions of 
this Section shall apply to such Bank, then, unless and until such Bank 
notifies the Company that the circumstances giving rise to such suspension or 
demand for compensation no longer exist:

(a)  all Loans to the Borrower which would otherwise be made by such Bank as 
(or continued as or converted into) Euro-Dollar Loans shall instead be 
Domestic Loans (on which interest and principal shall be payable 
contemporaneously with the related Euro-Dollar Loans of the other Banks), and

(b)  after each of its Euro-Dollar Loans to the Borrower has been repaid (or 
converted to a Domestic Loan), all payments of principal which would 
otherwise be applied to repay such Euro-Dollar Loans shall be applied to 
repay its Domestic Loans instead.

If such Bank notifies the Borrower that the circumstances giving rise to such 
notice no longer apply, the principal amount of each such Domestic Loan shall 
be converted into a Euro-Dollar Loan on the first day of the next succeeding 
Interest Period applicable to the related Euro-Dollar Loans of the other 
Banks.

                                       47

<PAGE>

     Section 8.06. Substitution of Bank. If (i) the obligation of any Bank to 
make Euro-Dollar Loans has been suspended pursuant to Section 8.02, (ii) any 
Bank has demanded compensation under Section 8.03 or (iii) any Bank has not 
signed an amendment or waiver which must be signed by all the Banks to become 
effective, and such amendment or waiver has been signed by the Super-Majority 
Banks, the Company shall have the right, with the assistance of the Agent, to 
seek a mutually satisfactory substitute bank or banks (which may be one or 
more of the Banks) to purchase the Notes and assume the Commitment of such 
Bank.

                                 ARTICLE 9
                                 Guaranty

     Section 9.01. The Guaranty. The Company hereby unconditionally 
guarantees the full and punctual payment (whether at stated maturity, upon 
acceleration or otherwise) of the principal of and interest on each Note 
issued by the Borrower pursuant to this Agreement, and the full and punctual 
payment of all other amounts payable by the Borrower under this Agreement.  
Upon failure by the Borrower to pay punctually any such amount, the Company 
shall forthwith on demand pay the amount not so paid at the place and in the 
manner specified in this Agreement.

     Section 9.02. Guaranty Unconditional. The obligations of the Company 
hereunder shall be unconditional, irrevocable and absolute and, without 
limiting the generality of the foregoing, shall not be released, discharged 
or otherwise affected by:

       (i)  any extension, renewal, settlement, compromise, waiver or release in
  respect of any obligation of the Borrower under this Agreement or any Note, by
  operation of law or otherwise;

      (ii)  any modification or amendment of or supplement to this Agreement or
  any Note;

     (iii)  any release, impairment, non-perfection or invalidity of any direct
  or indirect security for any obligation of the Borrower under this Agreement 
  or any Note;

      (iv)  any change in the corporate existence, structure or ownership of the
  Borrower, or any insolvency, bankruptcy, reorganization or other similar
  proceeding affecting the Borrower or its assets or any resulting 

                                    48

<PAGE>

release or discharge of any obligation of the Borrower contained in this
Agreement or any Note;

       (v)  the existence of any claim, set-off or other rights which the 
  Company may have at any time against the Borrower, the Agent, any Bank or 
  any other Person, whether in connection herewith or any unrelated 
  transactions, provided that nothing herein shall prevent the assertion of 
  any such claim by separate suit or compulsory counterclaim;

      (vi)  any invalidity or unenforceability relating to or against the
  Borrower for any reason of this Agreement or any Note, or any provision of
  applicable law or regulation purporting to prohibit the payment by the 
  Borrower of the principal of or interest on any Note or any other amount 
  payable by it under this Agreement; or

     (vii)  any other act or omission to act or delay of any kind by the
  Borrower, the Agent, any Bank or any other Person or any other circumstance
  whatsoever which might, but for the provisions of this paragraph, constitute 
  a legal or equitable discharge of the Company's obligations hereunder.

     Section 9.03. Discharge Only upon Payment in Full; Reinstatement In 
Certain Circumstances. The Company's obligations hereunder shall remain in 
full force and effect until the Commitments shall have terminated and the 
principal of and interest on the Notes and all other amounts payable by the 
Company and the Borrower under this Agreement shall have been indefeasibly 
paid in full.  If at any time any payment of the principal of or interest on 
any Note or any other amount payable by the Borrower under this Agreement is 
rescinded or must be otherwise restored or returned upon the insolvency, 
bankruptcy or reorganization of the Borrower or otherwise, the Company's 
obligations hereunder with respect to such payment shall be reinstated at 
such time as though such payment had been due but not made at such time.

     Section 9.04. Waiver by the Company. The Company irrevocably waives 
acceptance hereof, presentment, demand, protest and any notice not provided 
for herein, as well as any requirement that at any time any action be taken 
by any Person against the Borrower or any other Person.

     Section 9.05. Subrogation. The Company irrevocably waives any and all 
rights to which it may be entitled, by operation of law or otherwise, upon 
making any payment hereunder to be subrogated to the rights of the payee 
against the Borrower with respect to such payment or against any direct or 
indirect security 

                                    49

<PAGE>

therefor, or otherwise to be reimbursed, indemnified or exonerated by or for 
the account of the Borrower in respect thereof.

     Section 9.06. Stay of Acceleration. In the event that acceleration of 
the time for payment of any amount payable by the Borrower under this 
Agreement or its Notes is stayed upon insolvency, bankruptcy or 
reorganization of the Borrower, all such amounts otherwise subject to 
acceleration under the terms of this Agreement shall nonetheless be payable 
by the Company hereunder forthwith on demand by the Agent made at the request 
of the Required Banks.


                            ARTICLE 10
                           Miscellaneous

     Section 10.01. Notices. All notices, requests and other communications 
to any party hereunder shall be in writing (including bank wire, telex, 
facsimile transmission or similar writing) and shall be given to such party:  
(x) in the case of the Company, the Borrower or the Agent, at its address or 
facsimile number set forth on the signature pages hereof, (y) in the case of 
any Bank, at its address or facsimile number set forth in its Administrative 
Questionnaire or (z) in the case of any party, such other address or 
facsimile number as such party may hereafter specify for the purpose by 
notice to the Agent and the Company.  Each such notice, request or other 
communication shall be effective (i) if given by mail, 72 hours after such 
communication is deposited in the mails with first class postage prepaid, 
addressed as aforesaid, (ii) if given by facsimile transmission, when such 
facsimile is transmitted to the facsimile number specified pursuant to this 
Section 10.01 and telephonic confirmation of receipt thereof is received, or 
(iii) if given by any other means, when delivered at the address specified in 
this Section; provided that notices to the Agent under Article 2 or Article 8 
shall not be effective until received.

     Section 10.02. No Waivers. No failure or delay by the Agent or any Bank 
in exercising any right, power or privilege hereunder or under any Note shall 
operate as a waiver thereof nor shall any single or partial exercise thereof 
preclude any other or further exercise thereof or the exercise of any other 
right, power or privilege.  The rights and remedies herein provided shall be 
cumulative and not exclusive of any rights or remedies provided by law.

     Section 10.03. Expenses; Indemnification. (a) The Company shall pay (i) 
all out-of-pocket expenses of the Agent, including fees and disbursements of 
special counsel for the Agent, in connection with the preparation and 

                                 50

<PAGE>

administration of this Agreement, any waiver or consent hereunder or any 
amendment hereof or any Default or alleged Default hereunder and (ii) if an 
Event of Default occurs, all out-of-pocket expenses incurred by the Agent and 
each Bank, including fees and disbursements of counsel, in connection with 
such Event of Default and collection, bankruptcy, insolvency and other 
enforcement proceedings resulting therefrom.  

(b)  The Company agrees to indemnify the Agent and each Bank, their 
respective affiliates and the respective directors, officers, agents and 
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee 
harmless from and against any and all liabilities, losses, damages, costs and 
expenses of any kind, including, without limitation, the reasonable fees and 
disbursements of counsel, which may be incurred by such Indemnitee in 
connection with any investigative, administrative or judicial proceeding 
(whether or not such Indemnitee shall be designated a party thereto) brought 
or threatened relating to or arising out of this Agreement or any actual or 
proposed use of proceeds of Loans hereunder; provided that (i) no Indemnitee 
shall have the right to be indemnified hereunder for such Indemnitee's own 
gross negligence or willful misconduct as determined by a court of competent 
jurisdiction and (ii) the Company shall not be liable for any settlement 
entered into by an Indemnitee without its consent (which shall not be 
unreasonably withheld).

(c)  Each Indemnitee agrees to give the Company prompt written notice after 
it receives any notice of the commencement of any action, suit or proceeding 
for which such Indemnitee may wish to claim indemnification pursuant to 
subsection (b).  The Company shall have the right, exercisable by giving 
written notice within fifteen Domestic Business Days after the receipt of 
notice from such Indemnitee of such commencement, to assume, at the Company's 
expense, the defense of any such action, suit or proceeding; provided, that 
such Indemnitee shall have the right to employ separate counsel in any such 
action, suit or proceeding and to participate in the defense thereof, but the 
fees and expenses of such separate counsel shall be at such Indemnitee's 
expense unless (1) the Company shall have agreed to pay such fees and 
expenses; (2) the Company shall have failed to assume the defense of such 
action, suit or proceeding or shall have failed to employ counsel reasonably 
satisfactory to such Indemnitee in any such action, suit or proceeding; or 
(3) such Indemnitee shall have been advised by independent counsel in writing 
(with a copy to the Company) that there may be one or more defenses available 
to such Indemnitee which are in conflict with those available to the Company 
(in which case, if such Indemnitee notifies the Company in writing that it 
elects to employ separate counsel at the Company's expense, the Company shall 
be obligated to assume the expense, it being understood, however, that the 
Company shall not be liable for the fees or expenses 

                                     51

<PAGE>

of more than one separate firm of attorneys, which firm shall be designated 
in writing by such Indemnitee).

     Section 10.04. Sharing of Set-offs. Each Bank agrees that if it shall, 
by exercising any right of set-off or counterclaim or otherwise, receive 
payment of a proportion of the aggregate amount of principal and interest due 
with respect to any Note held by it which is greater than the proportion 
received by any other Bank in respect of the aggregate amount of principal 
and interest due with respect to any Note held by such other Bank, the Bank 
receiving such proportionately greater payment shall purchase such 
participations in the Notes held by the other Banks, and such other 
adjustments shall be made, as may be required so that all such payments of 
principal and interest with respect to the Notes held by the Banks shall be 
shared by the Banks pro rata; provided that nothing in this Section shall 
impair the right of any Bank to exercise any right of set-off or counterclaim 
it may have and to apply the amount subject to such exercise to the payment 
of indebtedness of the Borrower other than its indebtedness hereunder.   The 
Borrower agrees, to the fullest extent it may effectively do so under 
applicable law, that any holder of a participation in a Note, whether or not 
acquired pursuant to the foregoing arrangements, may exercise rights of 
set-off or counterclaim and other rights with respect to such participation 
as fully as if such holder of a participation were a direct creditor of the 
Borrower in the amount of such participation.

     Section 10.05. Amendments and Waivers. Any provision of this Agreement 
or the Notes may be amended or waived if, but only if, such amendment or 
waiver is in writing and is signed by the Company, the Borrower and the 
Required Banks (and, if the rights or duties of the Agent are affected 
thereby, by the Agent); provided that no such amendment or waiver shall, 
unless signed by all the Banks, (i) increase or decrease the Commitment of 
any Bank (except for a ratable decrease in the Commitments of all Banks) or 
subject any Bank to any additional obligation, (ii) reduce the principal of 
or rate of interest on any Loan or any fees hereunder, except as provided 
below, (iii) postpone the date fixed for any payment of principal of or 
interest on any Loan or any fees hereunder or for any reduction or 
termination of any Commitment, (iv) amend or waive the provisions of Article 
9 or (v) change the percentage of the Commitments or of the aggregate unpaid 
principal amount of the Notes, or the number of Banks, which shall be 
required for the Banks or any of them to take any action under this Section 
or any other provision of this Agreement.

     Section 10.06. Successors and Assigns. (a)  The provisions of this 
Agreement shall be binding upon and inure to the benefit of the parties 
hereto and their respective successors and assigns, except that neither the 
Company nor the

                                     52

<PAGE>

Borrower may assign or otherwise transfer any of its rights under this 
Agreement without the prior written consent of all Banks.

(b)  Any Bank may at any time grant to one or more banks or other 
institutions (each a "Participant") participating interests in its Commitment 
or any or all of its Loans, with (and subject to) the written consent of the 
Company and the Agent, which consents shall not be unreasonably withheld.  In 
the event of any such grant by a Bank of a participating interest to a 
Participant, such Bank shall remain responsible for the performance of its 
obligations hereunder, and the Company, the Borrower and the Agent shall 
continue to deal solely and directly with such Bank in connection with such 
Bank's rights and obligations under this Agreement.  Any agreement pursuant 
to which any Bank may grant such a participating interest shall provide that 
such Bank shall retain the sole right and responsibility to enforce the 
obligations of the Company and the Borrower hereunder including, without 
limitation, the right to approve any amendment, modification or waiver of any 
provision of this Agreement; provided that such participation agreement may 
provide that such Bank will not agree to any modification, amendment or 
waiver of this Agreement described in clause (i), (ii) or (iii) of Section 
10.05 without the consent of the Participant.  The Borrower agrees that each 
Participant shall, to the extent provided in its participation agreement, be 
entitled to the benefits of  Article 8 with respect to its participating 
interest.  An assignment or other transfer which is not permitted by 
subsection (c) or (d) below but which is consented to in accordance with this 
subsection (b) shall be given effect for purposes of this Agreement only to 
the extent of a participating interest granted in accordance with this 
subsection (b).

(c)  Any Bank may at any time assign to one or more banks or other 
institutions (each an "Assignee") all, or a proportionate part of all, of its 
rights and obligations under this Agreement and the Notes, and such Assignee 
shall assume such rights and obligations, pursuant to an Assignment and 
Assumption Agreement in substantially the form of Exhibit G hereto executed 
by such Assignee and such transferor Bank, with (and subject to) the 
subscribed consent of the Company and the Agent, which consents shall not be 
unreasonably withheld; provided that (i) if an Assignee is an affiliate of 
such transferor Bank, no such consent shall be required; (ii) such assignment 
may, but need not, include rights of the transferor Bank in respect of 
outstanding Money Market Loans; and (iii) any assignment shall not be less 
than $15,000,000, or if less, shall constitute an assignment of all of such 
Bank's rights and obligations under this Agreement and the Notes except for 
any rights retained in accordance with clause (ii) of this proviso.  Upon 
execution and delivery of such instrument and payment by such Assignee to 
such transferor Bank of an amount equal to the purchase price agreed between 
such transferor Bank and such Assignee, such Assignee shall be a Bank 

                                  53

<PAGE>

party to this Agreement and shall have all the rights and obligations of a 
Bank with a Commitment as set forth in such instrument of assumption, and the 
transferor Bank shall be released from its obligations hereunder to a 
corresponding extent, and no further consent or action by any party shall be 
required.  Upon the consummation of any assignment pursuant to this 
subsection (c), the transferor Bank, the Agent and the Borrower shall make 
appropriate arrangements so that, if required, new Notes are issued to the 
Assignee.  In connection with any such assignment, the transferor Bank shall 
pay to the Agent an administrative fee for processing such assignment in the 
amount of $2,500.  If the Assignee is not incorporated under the laws of the 
United States of America or a state thereof, it shall deliver to the Company 
and the Agent certification as to exemption from deduction or withholding of 
any United States federal income taxes in accordance with Section 8.04.

(d)  Any Bank may at any time assign all or any portion of its rights under 
this Agreement and its Notes to a Federal Reserve Bank.  No such assignment 
shall release the transferor Bank from its obligations hereunder.

(e)  No Assignee, Participant or other transferee of any Bank's rights shall 
be entitled to receive any greater payment under Section 8.03 or 8.04 than 
such Bank would have been entitled to receive with respect to the rights 
transferred, unless such transfer is made with the Company's prior written 
consent or by reason of the provisions of Section 8.02, 8.03 or 8.04 
requiring such Bank to designate a different Applicable Lending Office under 
certain circumstances or at a time when the circumstances giving rise to such 
greater payment did not exist.

      Section 10.07. Termination of Existing Credit Agreements. The Company 
and each of the Banks that is also a "Bank" party to the Existing Credit 
Agreements agrees that the "Commitments" as defined in the Existing Credit 
Agreements shall be terminated in their entirety on the Effective Date.  Each 
of such Banks waives (a) any requirement of notice of such termination 
pursuant to Section 2.09 of the Existing Credit Agreements and (b) any claim 
to any facility fees or other fees under the Existing Credit Agreements for 
any day on or after the Effective Date.  Each of the Company and the Borrower 
(i) represents and warrants that (x) after giving effect to the preceding 
sentences of this Section 10.07, the commitments under the Existing Credit 
Agreements will be terminated effective not later than the Effective Date, 
(y) no loans are, as of the date hereof, or will be, as of the Effective 
Date, outstanding under the Existing Credit Agreements and (ii) covenants 
that all accrued and unpaid facility fees and any other amounts due and 
payable under the Existing Credit Agreements shall have been paid on or prior 
to the Effective Date.

                                       54

<PAGE>

     Section 10.08. Governing Law; Submission to Jurisdiction. This Agreement 
and each Note shall be governed by and construed in accordance with the laws 
of the State of New York.  Each of the Company and the Borrower hereby 
submits to the nonexclusive jurisdiction of the United States District Court 
for the Southern District of New York and of any New York State court sitting 
in New York City for purposes of all legal proceedings arising out of or 
relating to this Agreement or the transactions contemplated hereby, and 
irrevocably waives, to the fullest extent permitted by law, any objection 
which it may now or hereafter have to the laying of the venue of any such 
proceeding brought in such a court and any claim that any such proceeding 
brought in such a court has been brought in an inconvenient forum.

     Section 10.09. Counterparts; Integration; Effectiveness. This Agreement 
may be signed in any number of counterparts, each of which shall be an 
original, with the same effect as if the signatures thereto and hereto were 
upon the same instrument.  This Agreement constitutes the entire agreement 
and understanding among the parties hereto and supersedes any and all prior 
agreements and understandings, oral or written, relating to the subject 
matter hereof.  This Agreement shall become effective upon receipt by the 
Agent of counterparts hereof signed by each of the Company, the Borrower, the 
Banks and the Agent (or, in the case of any party as to which an executed 
counterpart shall not have been received, receipt by the Agent in form 
satisfactory to it of telegraphic, telex or other written confirmation from 
such party of execution of a counterpart hereof by such party).

     Section 10.10. WAIVER OF JURY TRIAL. EACH OF THE COMPANY, THE BORROWER, 
THE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL 
BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT 
OR THE TRANSACTIONS CONTEMPLATED HEREBY.

     Section 10.11. Confidentiality. Each of the Agent and the Banks agrees 
to use its reasonable best efforts to keep confidential any information 
delivered or made available by the Company or the Borrower to it which is 
clearly stated by the Company or the Borrower to be confidential; provided 
that nothing herein shall prevent the Agent or any Bank from disclosing such 
information (i) to the Agent or any other Bank in connection with the 
transactions contemplated hereby, (ii) to its officers, directors, employees, 
agents, attorneys and accountants who have a need to know such information in 
accordance with customary banking practices and who receive such information 
having been made aware of the restrictions set forth in this Section, (iii) 
upon the order of any court or administrative agency, (iv) upon the request 
or demand of any regulatory agency 

                                     55

<PAGE>

or authority having jurisdiction over such party, (v) which has been publicly 
disclosed, (vi) which has been obtained from any Person other than the 
Company and its Subsidiaries, provided that such Person is not (x) known to 
it to be bound by a confidentiality agreement with the Company or its 
Subsidiaries or (y) known to it to be otherwise prohibited from transmitting 
the information to it by a contractual, legal or fiduciary obligation, (vii) 
in connection with the exercise of any remedy hereunder or under the Notes or 
(viii) to any actual or proposed participant or assignee of all or any of its 
rights hereunder which has agreed in writing to be bound by the provisions of 
this Section.


                                       56


<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly 
executed by their respective authorized officers as of the day and year first 
above written.

                                       U S WEST CAPITAL FUNDING, INC.

                                       By /s/ Rahn Porter
                                          ________________________________
                                          Title: Executive Director Treasury
                                                 Services
                                          7800 East Orchard Road
                                          Englewood, Colorado  80111
                                          Facsimile number:  303-793-6307
                                          Telephone number:  303-793-6250
                                          Attention:  Rahn Porter


                                       U S WEST, INC.

                                       By /s/ James T. Anderson
                                          ________________________________
                                          Title: Vice President & Treasurer
                                       7800 East Orchard Road
                                       Englewood, Colorado  80111
                                       Facsimile number:  303-793-6307
                                       Telephone number:  303-793-6250
                                       Attention:  Rahn Porter 


                                       57


<PAGE>

Commitments
___________

$140,000,000                           MORGAN GUARANTY TRUST
                                        COMPANY OF NEW YORK

                                       By /s/ George J. Stapleton
                                          ________________________________
                                          Title: Vice President



$ 140,000,000                          CITIBANK, N.A. 

                                       By /s/ Carolyn A. Kee
                                          ________________________________
                                          Title: Vice President



$ 140,000,000                          THE BANK OF NEW YORK

                                       By /s/ Kaplana Raina
                                          ________________________________
                                          Title: Senior Vice President



$ 100,000,000                          ABN AMRO BANK N.V.

                                       By /s/ James J. Johnston
                                          ________________________________
                                          Title: Vice President

                                       By /s/ Mary L. Honda
                                          ________________________________
                                          Title: Vice President


                                       58


<PAGE>


$ 37,500,000                           BANK OF AMERICA NW, N.A. dba
                                          SEAFIRST

                                       By /s/ Barbara W. Trimble
                                          ________________________________
                                          Title: Vice President



$ 62,500,000                           BANK OF AMERICA NT & SA 

                                       By /s/ Raymond E. Evans
                                          ________________________________
                                           Title: Senior Vice President Manager
                                                  Commercial Building



$100,000,000                           BARCLAYS BANK PLC

                                       By /s/ Les Bek
                                          ________________________________
                                          Title: Director



$ 100,000,000                          CANADIAN IMPERIAL BANK OF
                                         COMMERCE

                                       By /s/ Matthew S. Hannon
                                          ________________________________
                                          Title: Director, CIBC Wood Gundy
                                                 Securities acting, as Agent



$100,000,000                           THE CHASE MANHATTAN BANK

                                        By /s/ Ann B. Kerns
                                           ________________________________
                                           Title: Vice President


                                       59


<PAGE>

$100,000,000                           DEUTSCHE BANK AG
                                         NEW YORK AND/OR CAYMAN
                                         ISLANDS BRANCHES

                                       By /s/ Ross A. Howard
                                          ________________________________
                                          Title: Director

                                       By /s/ J. Scott Jessup
                                          ________________________________
                                          Title: Vice President



$100,000,000                           THE FIRST NATIONAL BANK OF
                                          BOSTON

                                       By /s/ Shepard D. Rainie
                                          ________________________________
                                          Title: Director



$100,000,000                           MELLON BANK N.A.

                                       By /s/ Stephen R. Viehe
                                          ________________________________
                                          Title: Vice President



$ 100,000,000                          THE SANWA BANK LIMITED,
                                         CHICAGO BRANCH

                                       By /s/ Kenneth C. Eichwald 
                                          ________________________________
                                          Title: First Vice President and
                                                  Assistant General Manager


                                       60


<PAGE>

$ 100,000,000                          SWISS BANK CORPORATION,
                                         SAN FRANCISCO BRANCH

                                       By /s/ Hans-Uoli Surber
                                          ________________________________
                                          Title: Executive Director Merchant
                                                 Banking

                                       By /s/ Nang S. Peechaphand
                                          ________________________________
                                          Title: Associate Director Accounting



$ 100,000,000                          TORONTO DOMINION BANK
                                         (TEXAS), INC.

                                       By /s/ Frederic B. Hawley
                                          ________________________________
                                          Title: Vice President



$ 70,000,000                           BANQUE NATIONALE DE PARIS

                                       By /s/ Clive Bettles
                                          ________________________________
                                          Title: Senior Vice President
                                            & Manager

                                       By /s/ Mitchell Ozawa
                                          ________________________________
                                          Title: Vice President



$ 70,000,000                           BANQUE PARIBAS

                                       By /s/ John Acker
                                          ________________________________
                                          Title: Group Vice President

                                       By /s/ Darlynn Ernst
                                          ________________________________
                                          Title: Assistant Vice President


                                       61


<PAGE>


$ 70,000,000                           CREDIT SUISSE

                                       By /s/ Stephen M.Flynn
                                          ________________________________
                                          Title: Member of Senior Management

                                       By /s/ Maria N. Gaspara
                                          ________________________________
                                          Title: Associate



$ 70,000,000                           THE DAI-ICHI KANGYO BANK,
                                         LIMITED

                                       By /s/ Teruhisa Yamaguchi
                                          ________________________________
                                          Title: Senior Vice President & Joint 
                                                 General Manager



$ 70,000,000                           THE FIRST NATIONAL BANK OF
                                         CHICAGO

                                       By /s/ Ronald L. Coleman
                                          ________________________________
                                          Title: Vice President



$ 70,000,000                           THE FUJI BANK LIMITED 
                                         LOS ANGELES AGENCY

                                       By /s/ Nobuhiro Umemura
                                          ________________________________
                                          Title: Joint General Manager


                                       62


<PAGE>

$ 70,000,000                           THE INDUSTRIAL BANK OF JAPAN,
                                         LTD. NEW YORK BRANCH

                                       By /s/ Akijiro Yoshino
                                          ________________________________
                                          Title: Executive Vice President,
                                                 Houston Office



$ 70,000,000                           NATIONSBANK OF TEXAS, N.A.

                                       By /s/ David G. James
                                          ________________________________
                                          Title: Vice President



$ 70,000,000                           ROYAL BANK OF CANADA

                                       By /s/ John P. Page
                                          ________________________________
                                          Title: Senior Manager



$ 70,000,000                           THE SAKURA BANK LIMITED

                                       By /s/ Ofusa Sato
                                          ________________________________
                                          Title: Senior Vice President
                                                 & Assistant General Manager



$ 70,000,000                            THE SUMITOMO BANK LIMITED
                                          LOS ANGELES BRANCH


                                       63

<PAGE>


                                           By /s/ Goro Hirai
                                           ________________________________
                                           Title: Joint General Manager 




$ 70,000,000                               UNION BANK OF CALIFORNIA, N.A.


                                           By /s/ Roger Hartley
                                           ________________________________
                                           Title: Vice President



$ 70,000,000                               WELLS FARGO BANK (COLORADO), N.A.


                                           By /s/ Jack W. Haye
                                           ________________________________
                                           Title: Vice President


  
$ 47,500,000                               BANK OF MONTREAL


                                           By /s/ Yvonne Bos
                                           ________________________________
                                           Title: Senior Vice President



$ 47,500,000                               CREDIT LYONNAIS
                                           NEW YORK BRANCH


                                           By /s/ James E. Morris
                                           ________________________________
                                           Title: Vice President



                                      64


<PAGE>


$ 47,500,000                               DRESDNER BANK AG, NEW YORK
                                            AND GRAND CAYMAN BRANCHES

 
                                           By /s/ William E. Lambert
                                           ________________________________
                                           Title: Assistant Vice President


                                           By /s/ Brian Haughney
                                           ________________________________
                                           Title: Assistant Treasurer



$ 47,500,000                               BAYERISCHE HYPO-BANK AG, 
                                           NEW YORK BRANCH


                                           By /s/ Yoram Dankner
                                           ________________________________
                                           Title: Senior Vice President

                                           By /s/ Christian F. Walter
                                           ________________________________
                                           Title: Vice President


$ 47,500,000                               KREDIETBANK N.A.


                                           By /s/ Tod R. Angus
                                           ________________________________
                                           Title: Vice President

                                           By /s/ Robert Snauffer
                                           ________________________________
                                           Title: Vice President


$ 47,500,000                               LLOYDS BANK PLC

                                     65

<PAGE>

                                           By /s/ Paul Briamonte
                                           ________________________________
                                           Title: Vice President B374


                                           By /s/ Theodore R. Walser
                                           _________________________________
                                           Title: Senior Vice President W075

          

$ 47,500,000                               THE LONG-TERM CREDIT BANK OF
                                            JAPAN, LTD. 
                                            LOS ANGELES AGENCY


                                           By /s/ T. Morgan Edwards II
                                           ________________________________
                                           Title: Deputy General Manager




$ 47,500,000                               THE MITSUBISHI TRUST AND
                                           BANKING CORPORATION


                                           By /s/ Patricia Loret de Mola
                                           ________________________________
                                           Title: Senior Vice President 
                                                  & Assistant General Manager


$ 47,500,000                               THE ROYAL BANK OF SCOTLAND plc

                                           By /s/ Grant F. Stoddart
                                           ________________________________
                                           Title: Senior Vice President 
                                                  & Manager

                                     66

<PAGE>



$ 47,500,000                               SOCIETE GENERALE
                                            SOUTHWEST AGENCY


                                           By /s/ Mark A. Cox
                                           ________________________________
                                           Title: Vice President


$ 47,500,000                               THE TOKAI BANK, LIMITED 
                                            LOS ANGELES AGENCY

                                           By /s/ Masahiko Saito
                                           ________________________________
                                           Title: Assistant General Manager
                                                  Corporate Finance




$ 47,500,000                               WESTDEUTSCHE LANDESBANK
                                            NEW YORK BRANCH


                                           By /s/ Salvatore Battinelli
                                           ________________________________
                                           Title: Vice President

                                           By /s/ Karen Hoplock
                                           ________________________________
                                           Title: Vice President Credit



Total Commitments:

$3,000,000,000
============

                                      67

<PAGE>

                                           CITIBANK, N.A., as Syndication Agent


                                           By /s/ Carolyn A. Kee
                                           ________________________________
                                           Title: As-Attorney-in-Fact


                                           THE BANK OF NEW YORK, as
                                            Documentation Agent


                                           By /s/ Kalpana Raina
                                           ________________________________
                                           Title: Senior Vice President


                                           MORGAN GUARANTY TRUST
                                            COMPANY OF NEW YORK, as 
                                            Administrative Agent


                                           By /s/ George J. Stapleton
                                           ________________________________
                                           Title: Vice President
                                           Address
                                           Attention:  Mark Connor
                                           Facsimile number:  302-634-1092
                                           Telephone number:  302-634-4218

<PAGE>

 
                                   PRICING SCHEDULE


    The "Euro-Dollar Margin" and "Facility Fee Rate" for any day are the 
respective percentages set forth below in the applicable row under the column 
corresponding to the Status that exists on such day:

--------------------------------------------------------------------------------
Status                Level  I  Level  II    Level III   Level  IV    Level  V
--------------------------------------------------------------------------------
Euro-Dollar Margin    .130%      .150%        .165%        .240%        .295%
--------------------------------------------------------------------------------
Facility Fee Rate     .070%      .075%        .085%        .110%        .155%
--------------------------------------------------------------------------------


    For purposes of this Schedule, the following terms have the following 
meanings:

    "Level I Status" exists at any date if, at such date, the Borrower's 
outstanding senior unsecured long-term debt securities are rated A or higher 
by S&P or A2 or higher by Moody's.

    "Level II Status" exists at any date if, at such date, (i) the Borrower's 
outstanding senior unsecured long-term debt securities are rated A- or higher 
by S&P or A3 or higher by Moody's and (ii) Level I Status does not exist.

    "Level III Status" exists at any date if, at such date, (i) the 
Borrower's outstanding senior unsecured long-term debt securities are rated 
BBB+ or higher by S&P or  Baa1 or higher by Moody's and (ii) neither Level I 
Status nor Level II Status exists.

    "Level IV Status" exists at any date if, at such date, (i) the Borrower's 
outstanding senior unsecured long-term debt securities are rated BBB or 
higher by S&P or Baa2 or higher by Moody's and none of Level I Status, Level 
II Status or  Level III Status exists.

    "Level V Status" exists at any date if, at such date, none of Level I 
Status, Level II Status, Level III Status or Level IV Status exists.



<PAGE>

    "Moody's" means Moody's Investors Service, Inc., a Delaware corporation, 
and its successors or, if such corporation shall be dissolved or liquidated 
or shall no longer perform the functions of a securities rating agency, 
"Moody's" shall be deemed to refer to any other nationally recognized 
securities rating agency designated by the Required Banks, with the approval 
of the Company, by notice to the Agent and the Company.

    "S&P" means Standard & Poor's Ratings Group, a New York corporation, and 
its successors or, if such corporation shall be dissolved or liquidated or 
shall no longer perform the functions of a securities rating agency, "S&P" 
shall be deemed to refer to any other nationally recognized securities rating 
agency designated by the Required Banks, with the approval of the Company, by 
notice to the Agent and the Company.

    "Status" refers to the determination of which of Level I Status, Level II 
Status, Level III Status, Level IV Status or Level V Status exists at any 
date.

The credit ratings to be utilized for purposes of this Schedule are those 
assigned to the senior unsecured long-term debt securities of the Borrower 
without third-party credit enhancement, and any rating assigned to any other 
debt security of the Borrower shall be disregarded.  The rating in effect at 
any date is that in effect at the close of business on such date.

                                     2

<PAGE>


                                    SCHEDULE 4.07

                                Environmental Matters

NONE.

 
<PAGE>
                                                                       EXHIBIT A
                                         NOTE
                                                              New York, New York

                                                                           ,19  


     For value received, U S WEST CAPITAL FUNDING, INC., a Colorado 
corporation (the "Borrower"), promises to pay to the order of (the "Bank"), 
for the account of its Applicable Lending Office, the unpaid principal amount 
of each Loan made by the Bank to the Borrower pursuant to the Credit 
Agreement referred to below on the maturity date therefor specified in the 
Credit Agreement. The Borrower promises to pay interest on the unpaid 
principal amount of each such Loan on the dates and at the rate or rates 
provided for in the Credit Agreement.  All such payments of principal and 
interest shall be made in lawful money of the United States in Federal or 
other immediately available funds at the office of Morgan Guaranty Trust 
Company of New York, 60 Wall Street, New York, New York.

    All Loans made by the Bank, the respective types and maturities thereof 
and all repayments of the principal thereof shall be recorded by the Bank 
and, if the Bank so elects in connection with any transfer or enforcement 
hereof, appropriate notations to evidence the foregoing information with 
respect to each such Loan then outstanding may be endorsed by the Bank on the 
schedule attached hereto, or on a continuation of such schedule attached to 
and made a part hereof; provided that the inaccuracy of, or the failure of 
the Bank to make, any such recordation or endorsement shall not affect the 
obligations of the Borrower hereunder or under the Credit Agreement.

    This note is one of the Notes referred to in the $3,000,000,000 Five-Year 
Credit Agreement dated as of November 1, 1996  among U S WEST Capital 
Funding, Inc., U S WEST, Inc., the banks listed on the signature pages 
thereof, the other agents named therein and Morgan Guaranty Trust Company of 
New York, as Administrative Agent (as the same may be amended from time to 
time, the "Credit Agreement").  Terms defined in the Credit Agreement are 
used herein with the same meanings. 


    Reference is made to the Credit Agreement for provisions for the 
prepayment hereof and the acceleration of the maturity hereof. 

<PAGE>


U S WEST, Inc., has, pursuant to the provisions of the Credit Agreement, 
unconditionally guaranteed the payment in full of the principal of and 
interest on this Note.

                                             U S WEST CAPITAL FUNDING, INC.

                                             By_____________________________
                                               Title:


                                       2

<PAGE>
 

                           LOANS AND PAYMENTS OF PRINCIPAL


________________________________________________________________________________
Date                                 Amount of                   
        Amount of                     Principal                 Notation Made
          Loan         Type of Loan    Repaid    Maturity Date        By

________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________


                                       3

<PAGE>


                                                                       EXHIBIT B


                          Form of Money Market Quote Request


                                        [Date]



To:  Morgan Guaranty Trust Company of New York
     (the "Agent")

From:  U S WEST Capital Funding, Inc.

Re:  $3,000,000,000 Five-Year Credit Agreement (the "Credit Agreement") dated 
     as of November 1, 1996 among U S WEST Capital Funding, Inc., U S WEST, 
     Inc., the Banks listed on the signature pages thereof, the other agents 
     named therein and the Agent

     We hereby give notice pursuant to Section 2.03 of the Credit Agreement 
that we request Money Market Quotes for the following proposed Money Market 
Borrowing(s):

Date of Borrowing:  __________________

Principal Amount**                            Interest Period***
------------------                            ------------------
$

    Such Money Market Quotes should offer a Money Market [Margin] 
[Absolute Rate]. 
[The applicable base rate is the London Interbank Offered Rate.]Terms used 
herein have the meanings assigned to them in the Credit Agreement.



----------------
** Amount must be $25,000,000 or a larger multiple of $5,000,000.

*** Not less than one month (LIBOR Auction) or not less than 7 days (Absolute 
    Rate Auction), subject to the provisions of the definition of Interest 
    Period.


<PAGE>

  Terms used herein have the meanings assigned to them in the Credit Agreement.

                                      U S WEST CAPITAL FUNDING, INC.


                                      By________________________
                                        Title:


                                     2

<PAGE>


                                                                       EXHIBIT C


                      Form of Invitation for Money Market Quotes



To:              [Name of Bank]

Re:              Invitation for Money Market Quotes to U S WEST Capital 
                 Funding, Inc. (the "Borrower")

  Pursuant to Section 2.03 of the $3,000,000,000 Five-Year Credit Agreement 
dated as of November 1, 1996 among U S WEST Capital Funding, Inc., U S WEST, 
Inc., the Banks parties thereto, the other agents named therein and the 
undersigned, as Administrative Agent, we are pleased on behalf of the 
Borrower to invite you to submit Money Market Quotes to the Borrower for the 
following proposed Money Market Borrowing(s):

Date of Borrowing:  __________________

Principal Amount              Interest Period


$

  Such Money Market Quotes should offer a Money Market [Margin] [Absolute Rate].
[The applicable base rate is the London Interbank Offered Rate.]
Please respond to this invitation by no later than [10:30 A.M.] [9:15 A.M.] 
(New York City time) on [date].

                           MORGAN GUARANTY TRUST COMPANY
                                  OF NEW YORK, as Administrative Agent


                           By______________________________
                                Authorized Officer 


<PAGE>

                                                                      EXHIBIT D

                              Form of Money Market Quote


To: Morgan Guaranty Trust Company of New York, 
    as Administrative Agent (the "Agent")

Re: Money Market Quote to 
    U S WEST Capital Funding, Inc. (the "Borrower")

  In response to your invitation on behalf of the Borrower dated _____________,
19__, we hereby make the following Money Market Quote on the following terms: 

1.    Quoting Bank:  ________________________________

2.    Person to contact at Quoting Bank:   _____________________________

3.    Date of Borrowing: ____________________*

4.    We hereby offer to make Money Market Loan(s) in the following principal 
      amounts, for the following Interest Periods and at the following rates:


Principal             Interest    Money Market
 Amount**             Period***   [Margin****]        [Absolute Rate*****]
---------             ---------   ------------        --------------------
$

$

  [Provided, that the aggregate principal amount of Money Market Loans for which
  the above offers may be accepted shall not exceed $____________.]**


__________
* As specified in the related Invitation.


  (notes continued on following page)

<PAGE>


  We understand and agree that the offer(s) set forth above, subject to the 
satisfaction of the applicable conditions set forth in the $3,000,000,000 
Five-Year Credit Agreement dated as of November 1, 1996 among U S WEST 
Capital Funding, Inc., U S WEST, Inc., the Banks listed on the signature 
pages thereof, the other agents named therein and yourselves, as Agent, 
irrevocably obligates us to make the Money Market Loan(s) for which any 
offer(s) are accepted, in whole or in part.

                                Very truly yours,
                                [NAME OF BANK]


Dated:_______________      By:__________________________
                                   Authorized Officer





__________

** Principal amount bid for each Interest Period may not exceed principal 
amount requested.  Specify aggregate limitation if the sum of the individual 
offers exceeds the amount the Bank is willing to lend.  Bids must be made for 
$5,000,000 or a larger multiple of $1,000,000.

*** Not less than one month or not less than 7 days, as specified in the 
related Invitation.  No more than five bids are permitted for each Interest 
Period.

**** Margin over or under the London Interbank Offered Rate determined for 
the applicable Interest Period.  Specify percentage (to the nearest 1/10,000 
of 1%) and specify whether "PLUS" or "MINUS".

***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).  

                                      2

<PAGE>

                                                                       EXHIBIT E


                                      OPINION OF
                       COUNSEL FOR THE COMPANY AND THE BORROWER
                                           

To the Banks and the Administrative 
  Agent Referred to Below
c/o Morgan Guaranty Trust Company
  of New York, as Administrative Agent
60 Wall Street
New York, New York  10260

Gentlemen and Ladies:

  I have acted as counsel for U S WEST, Inc. and U S WEST Capital Funding, 
Inc., in connection with the $3,000,000,000 Five-Year Credit Agreement (the 
"Credit Agreement") dated as of November 1, 1996, among them, the banks 
listed on the signature pages thereof, the other agents named therein and 
Morgan Guaranty Trust Company of New York, as Administrative Agent.  Terms 
defined in the Credit Agreement are used herein as therein defined.  This 
opinion is being rendered to you at the instruction of the client pursuant to 
Section 3.01(b) of the Credit Agreement.

  I am familiar with the proceedings taken by the Company and the Borrower in 
connection with the authorization, execution and delivery of the Credit 
Agreement and the Notes, and I have examined such documents, certificates, 
and such other matters of fact and questions of law as I have deemed relevant 
under the circumstances to express an informed opinion.  Upon the basis of 
the foregoing, I am of the opinion that:

  1.  The Company is a corporation duly incorporated, validly existing and in 
good standing under the laws of the State of Delaware, and has all corporate 
powers and all governmental licenses, authorizations, qualifications, 
consents and approvals required to carry on its business as now conducted, 
except where the absence of any such license, authorization, qualification, 
consent or approval would not have a material adverse effect on the 
consolidated financial position or consolidated results of operations of the 
Company and its Consolidated Subsidiaries considered as one enterprise.


<PAGE>

  2.  The execution, delivery and performance by the Company and the Borrower 
of the Credit Agreement and by the Borrower of the Notes are within such 
Person's corporate powers, have been duly authorized by all necessary 
corporate action, and require no action by or in respect of, or filing with, 
any governmental body, agency or official.

  3.  The execution, delivery and performance by the Company and the Borrower 
of the Credit Agreement and by the Borrower of the Notes will not (i) result 
in a breach or violation of, conflict with, or constitute a default under, 
the articles of incorporation or bylaws of such Person or any material law or 
regulation or any material order, judgment, agreement or instrument to which 
such Person is a party or by which such Person is bound, or (ii) result in 
the creation or imposition of any Lien on any asset of such Person.

  4.  The Credit Agreement constitutes a valid and binding agreement of the 
Company and the Borrower and the Notes constitute valid and binding 
obligations of the Borrower.

  5.  To my knowledge, there is no action, suit or proceeding pending against 
or threatened against or affecting the Company or any of its Subsidiaries 
before any court or arbitrator or any governmental body, agency or official, 
in which there is a reasonable possibility of an adverse decision which could 
materially adversely affect the business, consolidated financial position or 
consolidated results of operations of the Company and its Consolidated 
Subsidiaries, considered as a whole, or which in any manner draws into 
question the validity of the Credit Agreement or the Notes.

  6.  The Borrower and each of the Company's other corporate Significant 
Subsidiaries is a corporation validly existing and in good standing under the 
laws of their jurisdictions of incorporation, and have all corporate powers 
and all governmental licenses, authorizations, qualifications, consents and 
approvals required to carry on its business as now conducted, except where 
the absence of any such license, authorization, qualification, consent or 
approval would not have a material adverse effect on the consolidated 
financial position or consolidated results of operations of the Company and 
its Consolidated Subsidiaries considered as one enterprise.

  For purposes of my opinion set forth in numbered paragraph 4 above, I have 
assumed that the laws of the State of New York, which are stated to govern 
the Credit Agreement and the Notes, are the same as the laws of Colorado.

                                      2

<PAGE>

  In rendering the opinions set forth herein, I have assumed that the Credit 
Agreement and the Notes will conform to the specimens thereof examined by me, 
that the signatures on all documents examined by me were genuine, and the 
authenticity of all documents submitted to me as originals or as copies of 
originals, assumptions which I have not independently verified.

  This opinion is furnished by me as counsel for the Company and the Borrower 
and is solely for your benefit and the benefit of any Assignee under the 
Credit Agreement.  Without my prior written consent, this opinion may not be 
relied upon by you or any Assignee in any other context or by any other 
person.  This opinion may not be quoted, in whole or in part, or copies 
thereof furnished, to any other person without my prior written consent, 
except that you may furnish copies hereof (a) to your auditors and attorneys, 
(b) to any state or federal authority having regulatory jurisdiction over you 
or the Company or the Borrower, (c) pursuant to order or legal process of any 
court or governmental agency, (d) in connection with any legal action to 
which you are a party arising out of the transactions contemplated by the 
Credit Agreement, and (e) to any Participant or proposed Participant in the 
Commitment of any Bank.

  This opinion is limited to the present laws of the State of Colorado and 
the General Corporation Law of the State of Delaware, to present judicial 
interpretations thereof, and to the facts as they presently exist, and I 
assume no responsibility as to the applicability or effect of the laws of any 
other jurisdiction.  In rendering this opinion, I assume no obligation to 
revise or supplement this opinion should the present laws of the State of 
Colorado or the General Corporation Law of the State of Delaware be changed 
by legislative action, judicial decision, or otherwise.

                                     Very truly yours,


                                     Stephen E. Brilz

                                    3

<PAGE>


                                                                       EXHIBIT F




                                      OPINION OF
                       DAVIS POLK & WARDWELL, SPECIAL COUNSEL 
                             FOR THE ADMINISTRATIVE AGENT
                                           



To the Banks and the Administrative Agent
  Referred to Below
c/o Morgan Guaranty Trust Company
  of New York, as Administrative Agent
60 Wall Street
New York, New York  10260

Dear Sirs:

  We have participated in the preparation of the $3,000,000,000 Five-Year 
Credit Agreement (the "Credit Agreement") dated as of November 1, 1996 among 
U S WEST Capital Funding, Inc., U S WEST, Inc., the banks listed on the 
signature pages thereof (the "Banks"), the other agents named therein and 
Morgan Guaranty Trust Company of New York, as Administrative Agent (the 
"Agent"), and have acted as special counsel for the Agent for the purpose of 
rendering this opinion pursuant to Section 3.01(c) of the Credit Agreement.  
Terms defined in the Credit Agreement are used herein as therein defined.

  We have examined originals or copies, certified or otherwise identified to 
our satisfaction, of such documents, corporate records, certificates of 
public officials and other instruments and have conducted such other 
investigations of fact and law as we have deemed necessary or advisable for 
purposes of this opinion.

  Upon the basis of the foregoing, we are of the opinion that, assuming that 
the execution, delivery and performance by the Company and the Borrower of 
the Credit Agreement and by the Borrower of the Notes are within such 
Person's corporate powers and have been duly authorized by all necessary 
corporate action, the Credit Agreement constitutes a valid and binding 
agreement of the Company and the Borrower and the Notes constitute valid and 
binding obligations of the Borrower.


<PAGE>

  We are members of the Bar of the State of New York and the foregoing 
opinion is limited to the laws of the State of New York.  In giving the 
foregoing opinion, we express no opinion as to the effect (if any) of any law 
of any jurisdiction (except the State of New York) in which any Bank is 
located which limits the rate of interest that such Bank may charge or 
collect.

  This opinion is rendered solely to you in connection with the above matter. 
This opinion may not be relied upon by you for any other purpose or relied 
upon by or furnished to any other person without our prior written consent.

                                         Very truly yours, 
 

                                     2

<PAGE>

                                                                       EXHIBIT G



                         ASSIGNMENT AND ASSUMPTION AGREEMENT


    AGREEMENT dated as of _________, 19__ among [ASSIGNOR] (the "Assignor"), 
[ASSIGNEE](the "Assignee"), U S WEST, Inc. (the "Company") and MORGAN 
GUARANTY TRUST COMPANY OF NEW YORK, as Administrative Agent (the "Agent").

                                 W I T N E S S E T H

    WHEREAS, this Assignment and Assumption Agreement (the "Agreement") 
relates to the $3,000,000,000 Five-Year Credit Agreement dated as of November 
1, 1996 among the Company, the Borrower named therein, the Assignor and the 
other Banks party thereto, as Banks, the other agents named therein and the 
Agent (the "Credit Agreement");

    WHEREAS, as provided under the Credit Agreement, the Assignor has a 
Commitment to make Loans in an aggregate principal amount at any time 
outstanding not to exceed $__________;

    WHEREAS, Committed Loans made by the Assignor under the Credit Agreement 
in the aggregate principal amount of $__________ are outstanding at the date 
hereof; and

    WHEREAS, the Assignor proposes to assign to the Assignee all of the 
rights of the Assignor under the Credit Agreement in respect of a portion of 
its Commitment thereunder in an amount equal to $__________ (the "Assigned 
Amount"), together with a corresponding portion of its outstanding Committed 
Loans, and the Assignee proposes to accept assignment of such rights and 
assume the corresponding obligations from the Assignor on such terms;

    NOW, THEREFORE, in consideration of the foregoing and the mutual 
agreements contained herein, the parties hereto agree as follows:

    SECTION 1.  Definitions. All capitalized terms not otherwise defined 
herein shall have the respective meanings set forth in the Credit Agreement.



<PAGE>

    SECTION 2.  Assignment.  The Assignor hereby assigns and sells to the 
Assignee all of the rights of the Assignor under the Credit Agreement to the 
extent of the Assigned Amount, and the Assignee hereby accepts such 
assignment from the Assignor and assumes all of the obligations of the 
Assignor under the Credit Agreement to the extent of the Assigned Amount, 
including the purchase from the Assignor of the corresponding portion of the 
principal amount of the Committed Loans made by the Assignor outstanding at 
the date hereof.  Upon the execution and delivery hereof by the Assignor, the 
Assignee, the Company and the Agent and the payment of the amounts specified 
in Section 3 required to be paid on the date hereof (i) the Assignee shall, 
as of the date hereof, succeed to the rights and be obligated to perform the 
obligations of a Bank under the Credit Agreement with a Commitment in an 
amount equal to the Assigned Amount, and (ii) the Commitment of the Assignor 
shall, as of the date hereof, be reduced by a like amount and the Assignor 
released from its obligations under the Credit Agreement to the extent such 
obligations have been assumed by the Assignee.  The assignment provided for 
herein shall be without recourse to the Assignor.

SECTION 3.  Payments.  As consideration for the assignment and sale 
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on 
the date hereof in Federal funds the amount heretofore agreed between them. 
**** It is understood that commitment and/or facility fees accrued to the 
date hereof are for the account of the Assignor and such fees accruing from 
and including the date hereof are for the account of the Assignee.  Each of 
the Assignor and the Assignee hereby agrees to that if it receives any amount 
under the Credit Agreement which is for the account of the other party 
hereto, it shall receive the same for the account of such other party to the 
extent of such other party's interest therein and shall promptly pay the same 
to such other party.

    [SECTION 4. Consent of the Company and the Agent.  This Agreement is 
conditioned upon the consent of the Company and the Agent pursuant to Section 
10.06(c) of the Credit Agreement.  The execution of this Agreement by the 
Company and the Agent is evidence of this consent.  Pursuant to Section 
10.06(c) the Company agrees to cause the Borrower to execute and deliver 
a Note payable to the order of the Assignee to evidence the assignment and 
assumption provided for herein.]

-----------------------

**** Amount should combine principal together with accrued interest and 
     breakage compensation, if any, to be paid by the Assignee, net of any 
     portion of any upfront fee to be paid by the Assignor to the Assignee.  
     It may be preferable in an appropriate case to specify these amounts 
     generically or by formula rather than as a fixed sum.  

                                       2

<PAGE>

    SECTION 5.  Non-Reliance on Assignor.  The Assignor makes no 
representation or warranty in connection with, and shall have no 
responsibility with respect to, the solvency, financial condition, or 
statements of the Company or the Borrower, or the validity and enforceability 
of the obligations of the Company or the Borrower in respect of the Credit 
Agreement or any Note.  The Assignee acknowledges that it has, independently 
and without reliance on the Assignor, and based on such documents and 
information as it has deemed appropriate, made its own credit analysis and 
decision to enter into this Agreement and will continue to be responsible for 
making its own independent appraisal of the business, affairs and financial 
condition of the Company and the Borrower.

    SECTION 6.  Governing Law.  This Agreement shall be governed by and 
construed in accordance with the laws of the State of New York.

    SECTION 7.  Counterparts.  This Agreement may be signed in any number of 
counterparts, each of which shall be an original, with the same effect as if 
the signatures thereto and hereto were upon the same instrument.

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


                                          [ASSIGNOR]

                                          By______________________________
                                            Title:

                                      3


<PAGE>

                                          [ASSIGNEE]


                                          By______________________________
                                            Title:



                                          [U S WEST, INC.


                                          By_______________________________
                                            Title:


                                          MORGAN GUARANTY TRUST
                                           COMPANY OF NEW YORK, as
                                           Administrative Agent


                                           By______________________________
                                             Title:]

                                    4

<PAGE>

                                                                       EXHIBIT H



                                 EXTENSION AGREEMENT



US WEST Capital Funding, Inc.
US WEST, Inc.
7800 East Orchard Road
Englewood, Colorado  80111

Morgan Guaranty Trust Company of
  New York, as Administrative Agent
  under the Credit Agreement referred 
  to below
60 Wall Street
New York, NY  10260

Gentlemen:

  The undersigned hereby agree to extend the Revolving Credit Period under 
the Five-Year Credit Agreement dated as of November 1, 1996 among US WEST 
Capital Funding, Inc., US WEST, Inc., the Banks listed therein, the other 
agents named therein and Morgan Guaranty Trust Company of New York, as 
Administrative Agent (the "Credit Agreement") for 364 days to ____________ 
__, ____.  Terms defined in the Credit Agreement are used herein as therein 
defined.

  This Extension Agreement shall be construed in accordance with and governed 
by the law of the State of New York.  It may be signed in any number of 
counterparts, each of which shall be an original, with the same effect as if 
the signatures thereto and hereto were upon the same instrument.

                                         [NAME OF BANK] *****

                                         By
                                            ----------------------------

-----------------
***** Insert names of Banks which have responded 
      affirmatively in accordance with Section 2.01(b) of the Credit Agreement.

<PAGE>

                                           Title:

                                           [NAME OF BANK]******


                                           By__________________________
                                             Title:


                                           [NAME OF BANK]*


                                           By__________________________
                                             Title:


                                           [NAME OF BANK]*


                                           By__________________________
                                             Title:


                                           [NAME OF BANK]*


                                           By__________________________
                                             Title:

                                           [NAME OF BANK]*


                                           By__________________________
                                             Title:

-------------
******Insert names of Banks which have responded  affirmatively in accordance 
with Section 2.01(b) of  the Credit Agreement.

                                      2

<PAGE>

Agreed and accepted:

US WEST CAPITAL FUNDING, INC.


By__________________________
  Title


US WEST, INC.

By__________________________
  Title

MORGAN GUARANTY TRUST COMPANY
  OF NEW YORK, as Administrative Agent


By__________________________
  Title

                                             3