TERM LOAN AGREEMENT 
 
                        DATED AS OF DECEMBER 16, 1996 
 
                                    AMONG 
 
                           BANKNORTH GROUP, INC., 
 
                                 THE LENDERS 
 
                                     AND 
 
                     THE FIRST NATIONAL BANK OF CHICAGO, 
 
                                  AS AGENT 
 
 
                              TABLE OF CONTENTS 
 
ARTICLE I      DEFINITIONS                                          Page 1 
 
ARTICLE II     THE CREDITS                                         Page 12 
      2.1.     Commitment                                          Page 12 
      2.2.     Required Payments; Termination Date                 Page 12 
      2.3.     Ratable Loans                                       Page 12 
      2.4.     Types of Advances                                   Page 12 
      2.5.     Applicable Margin                                   Page 13 
      2.6.     Minimum Amount of Each Advance                      Page 13 
      2.7.     Optional Principal Payments                         Page 13 
      2.8.     Method of Selecting Types and Eurodollar 
                Interest Periods for New Advances                  Page 13 
      2.9.     Conversion and Continuation of  
                Outstanding Advances                               Page 14 
     2.10.     Changes in Interest Rate, etc.                      Page 15 
     2.11.     Rates Applicable After Default                      Page 15 
     2.12.     Method of Payment   Page 15 
     2.13.     Notes; Telephonic Notices   Page 16 
     2.14.     Interest Payment Dates; Interest and Fee Basis      Page 16 
     2.15.     Notification of Advances, Interest  
                Rates and Prepayments                              Page 17 
     2.16.     Lending Installations                               Page 17 
     2.17.     Non-Receipt of Funds by the Agent                   Page 17 
     2.18.     Withholding Tax Exemption                           Page 18 
 
ARTICLE III    CHANGE IN CIRCUMSTANCES                             Page 18 
     3.1.      Yield Protection                                    Page 18 
     3.2.      Changes in Capital Adequacy Regulations             Page 19 
     3.3.      Availability of Types of Advances                   Page 19 
     3.4.      Funding Indemnification                             Page 20 
     3.5.      Lender Statements; Survival of Indemnity            Page 20 
 
ARTICLE IV     CONDITIONS PRECEDENT                                Page 21 
     4.1.      Initial Advance                                     Page 21 
 
ARTICLE V      REPRESENTATIONS AND WARRANTIES                      Page 22 
     5.1.      Corporate Existence and Standing                    Page 22 
     5.2.      Authorization and Validity                          Page 22 
     5.3.      No Conflict; Government Consent                     Page 22 
     5.4.      Financial Statements                                Page 23 
     5.5.      Material Adverse Change                             Page 23 
     5.6.      Taxes                                               Page 23 
     5.7.      Litigation and Contingent Obligations               Page 23 
     5.8.      Subsidiaries                                        Page 23 
     5.9.      ERISA                                               Page 23 
    5.10.      Accuracy of Information                             Page 24 
    5.11.      Regulation U                                        Page 24 
    5.12.      Material Agreements                                 Page 24 
    5.13.      Compliance With Laws                                Page 24 
    5.14.      Ownership of Properties                             Page 24 
    5.15.      Investment Company Act                              Page 24 
    5.16.      Public Utility Holding Company Act                  Page 25 
    5.17.      Solvency                                            Page 25 
 
ARTICLE VI     COVENANTS                                           Page 25 
     6.1.      Financial Reporting                                 Page 25 
     6.2.      Use of Proceeds                                     Page 28 
     6.3.      Notice of Default                                   Page 28 
     6.4.      Conduct of Business                                 Page 28 
     6.5.      Taxes                                               Page 28 
     6.6.      Insurance                                           Page 29 
     6.7.      Compliance with Laws                                Page 29 
     6.8.      Maintenance of Properties                           Page 29 
     6.9.      Inspection                                          Page 29 
    6.10.      Dividends                                           Page 29 
    6.11.      Indebtedness                                        Page 30 
    6.12.      Merger                                              Page 30 
    6.13.      Sale of Assets                                      Page 30 
    6.14.      Sale and Leaseback                                  Page 31 
    6.15.      Investments and Acquisitions                        Page 31 
    6.16.      Liens                                               Page 32 
    6.17.      Fixed Asset Expenditures                            Page 34 
    6.18.      Consolidated Non-Performing Assets to 
                Total Equity Capital                               Page 34 
    6.19.      Funded Debt to Tangible Equity Capital              Page 34 
    6.20.      Return on Average Assets                            Page 35 
    6.21.      Capitalization                                      Page 34 
    6.22.      Capital Guidelines                                  Page 35 
    6.23.      Affiliates                                          Page 35 
 
ARTICLE VII    DEFAULTS                                            Page 35 
 
ARTICLE VIII   ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES      Page 38 
    8.1.       Acceleration                                        Page 38 
    8.2.       Amendments                                          Page 38 
    8.3.       Preservation of Rights                              Page 39 
 
ARTICLE IX     GENERAL PROVISIONS                                  Page 39 
    9.1.       Survival of Representations                         Page 39 
    9.2.       Governmental Regulation                             Page 39 
    9.3.       Taxes                                               Page 39 
    9.4.       Headings; References to Statutes                    Page 39 
    9.5.       Entire Agreement   Page 40 
    9.6.       Several Obligations; Benefits of this Agreement     Page 40 
    9.7.       Expenses; Indemnification                           Page 40 
    9.8.       Numbers of Documents                                Page 40 
    9.9.       Accounting                                          Page 40 
   9.10.       Severability of Provisions                          Page 41 
   9.11.       Nonliability of Lenders                             Page 41 
   9.12.       CHOICE OF LAW                                       Page 41 
   9.13.       CONSENT TO JURISDICTION                             Page 41 
   9.14.       WAIVER OF JURY TRIAL                                Page 41 
   9.15.       Confidentiality                                     Page 42 
 
ARTICLE X      THE AGENT                                           Page 42 
   10.1.       Appointment                                         Page 42 
   10.2.       Powers                                              Page 42 
   10.3.       General Immunity                                    Page 42 
   10.4.       No Responsibility for Loans, Recitals, etc.         Page 42 
   10.5.       Action on Instructions of Lenders                   Page 43 
   10.6.       Employment of Agents and Counsel                    Page 43 
   10.7.       Reliance on Documents; Counsel                      Page 43 
   10.8.       Agent's Reimbursement and Indemnification           Page 43 
   10.9.       Rights as a Lender                                  Page 44 
   10.10.      Lender Credit Decision                              Page 44 
   10.11.      Successor Agent                                     Page 44 
   10.12.      Agent's Fees                                        Page 45 
 
ARTICLE XI     SETOFF; RATABLE PAYMENTS                            Page 45 
   11.1.       Setoff                                              Page 45 
   11.2.       Ratable Payments                                    Page 45 
 
ARTICLE XII    BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS   Page 46 
   12.1.       Successors and Assigns                              Page 46 
   12.2.       Participations                                      Page 46 
               12.2.1.   Permitted Participants; Effect            Page 46 
               12.2.2.   Voting Rights                             Page 47 
               12.2.3.   Benefit of Setoff                         Page 47 
   12.3.       Assignments                                         Page 47 
               12.3.1.   Permitted Assignments                     Page 47 
               12.3.2.   Effect; Effective Date                    Page 48 
   12.4.       Dissemination of Information                        Page 48 
   12.5.       Tax Treatment                                       Page 48 
 
ARTICLE XIII   NOTICES                                             Page 49 
   13.1.       Giving Notice                                       Page 49 
   13.2.       Change of Address                                   Page 49 
 
ARTICLE XIV    COUNTERPARTS                                        Page 49 
 
                                  EXHIBITS
                                  -------- 
EXHIBIT "A"    NOTE                                                Page 51 
 
EXHIBIT "B"    FORM OF OPINION                                     Page 53 
 
EXHIBIT "C"    COMPLIANCE CERTIFICATE                              Page 55 
 
EXHIBIT "D"    ASSIGNMENT AGREEMENT                                Page 60 
 
EXHIBIT "E"    LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTIONS     Page 70 
 
                                  SCHEDULES
                                  ---------
 
SCHEDULE "1"   LITIGATION AND CONTINGENT OBLIGATIONS               Page 71 
 
SCHEDULE "2"   SUBSIDIARIES AND OTHER INVESTMENTS                  Page 72 
 
SCHEDULE "3"   INDEBTEDNESS AND LIENS                              Page 73 
 
                             TERM LOAN AGREEMENT 
 
      This Agreement, dated as of December 16, 1996, is among Banknorth 
Group, Inc., the Lenders and The First National Bank of Chicago, as Agent.  
The parties hereto agree as follows: 
 
                                  ARTICLE I 
 
                                 DEFINITIONS
                                 -----------
 
      As used in this Agreement: 
 
      "Acquisition" means any transaction, or any series of related 
transactions, consummated on or after the date of this Agreement, by which 
the Borrower or any of its Subsidiaries (i) acquires any assets of another 
Person or acquires any going business or all or substantially all of the 
assets of any firm, corporation or division thereof, whether through 
purchase of assets, merger or otherwise or (ii) directly or indirectly 
acquires (in one transaction or as the most recent transaction in a series 
of transactions) at least a majority (in number of votes) of the securities 
of a corporation which have ordinary voting power for the election of 
directors (other than securities having such power only by reason of the 
happening of a contingency) or a majority (by percentage or voting power) of 
the outstanding partnership interests of a partnership. 
 
      "Advance" means a borrowing hereunder consisting of the aggregate 
amount of the several Loans made by the Lenders to the Borrower of the same 
Type and, in the case of Eurodollar Advances, for the same Eurodollar 
Interest Period. 
 
      "Affiliate" of any Person means any other Person directly or 
indirectly controlling, controlled by or under common control with such 
Person.  A Person shall be deemed to control another Person if the 
controlling Person owns 10% or more of any class of voting securities (or 
other ownership interests) of the controlled Person or possesses, directly 
or indirectly, the power to direct or cause the direction of the management 
or policies of the controlled Person, whether through ownership of stock, by 
contract or otherwise. 
 
      "Agent" means The First National Bank of Chicago in its capacity as 
agent for the Lenders pursuant to Article X, and not in its individual 
capacity as a Lender, and any successor Agent appointed pursuant to Article 
X. 
 
      "Aggregate Commitment" means the aggregate of the Commitments of all 
the Lenders. 
 
      "Agreement" means this Term Loan Agreement, as it may be amended or 
modified and in effect from time to time. 
 
      "Agreement Accounting Principles" means generally accepted accounting 
principles as in effect from time to time, applied in a manner consistent 
with that used in preparing the financial statements referred to in Section 
5.4. 
 
      "Alternate Base Rate" means, for any day, a rate of interest per annum 
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the 
sum of Federal Funds Effective Rate for such day plus 1/2% per annum. 
 
      "Annualized Net Income" means actual year-to-date Net Income divided 
by the actual number of days in the year-to-date period, multiplied by the 
actual number of days in the year. 
 
      "Applicable Margin" is defined in Section 2.5. 
 
      "Article" means an article of this Agreement unless another document 
is specifically referenced. 
 
      "Authorized Officer" means any of the President and Chief Executive 
Officer, Executive Vice President and Chief Financial Officer, Senior Vice 
President and Treasurer or Director of Investments of the Borrower, acting 
singly. 
 
      "Banking Subsidiary" means any insured depository institution (within 
the meaning of 12 U.S.C. 1813(c), as amended, supplemented or otherwise 
modified from time to time), which is controlled (within the meaning of 12 
U.S.C. 1841, as amended, supplemented or otherwise modified from time to 
time) by the Borrower. 
 
      "Borrower" means Banknorth Group, Inc., a Delaware corporation, and 
its successors and assigns. 
 
      "Borrowing Date" means a date on which an Advance is made hereunder. 
 
      "Borrowing Notice" is defined in Section 2.8. 
 
      "Business Day" means (i) with respect to any borrowing, payment or 
rate selection of Eurodollar Advances, a day (other than a Saturday or 
Sunday) on which banks generally are open in Chicago and New York for the 
conduct of substantially all of their commercial lending activities and on 
which dealings in United States dollars are carried on in the London 
interbank market and (ii) for all other purposes, a day (other than a 
Saturday or Sunday) on which banks generally are open in Chicago for the 
conduct of substantially all of their commercial lending activities. 
 
      "Capitalized Lease" of a Person means any lease of Property by such 
Person as lessee which would be capitalized on a balance sheet of such 
Person prepared in accordance with Agreement Accounting Principles. 
 
      "Capitalized Lease Obligations" of a Person means the amount of the 
obligations of such Person under Capitalized Leases which would be shown as 
a liability on a balance sheet of such Person prepared in accordance with 
Agreement Accounting Principles. 
 
      "Change in Control" means the acquisition by any Person, or two or 
more Persons acting in concert, of beneficial ownership (within the meaning 
of Rule 13d-3 of the Securities and Exchange Commission under the Securities 
Exchange Act of 1934) of 20% or more of the outstanding shares of voting 
stock of the Borrower. 
 
      "Closing Date" means the date on which all of the conditions set forth 
in Section 4.1 are satisfied.  
 
      "Code" means the Internal Revenue Code of 1986, as amended, reformed 
or otherwise modified from time to time. 
 
      "Commitment" means, for each Lender, the obligation of such Lender to 
make a Loan to the Borrower pursuant to Section 2.1 not exceeding the amount 
set forth opposite its signature below. 
 
      "Condemnation" is defined in Section 7.8. 
 
      "Consolidated Financial Statements" means the Consolidated Financial 
Statements for Bank Holding Companies With Total Consolidated Assets of $150 
Million or More, or With More Than One Subsidiary Bank--FR Y-9 C, as such 
report may be amended or modified from time to time, and any similar report 
required to be filed by the Borrower. 
 
      "Consolidated Net Income" means the Borrower's net income determined 
in a manner consistent with that used in preparing the Borrower's September 
30, 1996 Consolidated Financial Statements, which amount is currently 
reported on line 13 of Schedule HI thereto. 
 
      "Consolidated Reports of Condition and Income" means the Consolidated 
Reports of Condition and Income for A Bank With Domestic and Foreign 
Offices--FFIEC 031, Consolidated Reports of Condition and Income for A Bank 
With Domestic Offices Only and Total Assets of $300 Million or More--FFIEC 
032, Consolidated Reports of Condition and Income for A Bank With Domestic 
Offices Only and Total Assets of $100 Million or More But Less Than $300 
Million--FFIEC 033, and Consolidated Reports of Condition and Income for A 
Bank With Domestic Offices Only and Total Assets of Less Than $100 Million--
FFIEC 034, as such reports may be amended or modified from time to time, and 
any similar report required to be filed by any Banking Subsidiary. 
 
      "Contingent Obligation" of a Person means any agreement, undertaking 
or arrangement by which such Person assumes, guarantees, endorses, 
contingently agrees to purchase or provide funds for the payment of, or 
otherwise becomes or is contingently liable upon, the obligation or 
liability of any other Person, or agrees to maintain the net worth or 
working capital or other financial condition of any other Person, or 
otherwise assures any creditor of such other Person against loss, including, 
without limitation, any comfort letter, operating agreement, take-or-pay 
contract or application for a Letter of Credit. 
 
      "Conversion/Continuation Notice" is defined in Section 2.9. 
 
      "Controlled Group" means all members of a controlled group of 
corporations and all trades or businesses (whether or not incorporated) 
under common control which, together with the Borrower or any of its 
Subsidiaries, are treated as a single employer under Section 414 of the 
Code. 
 
      "Corporate Base Rate" means a rate per annum equal to the corporate 
base rate of interest announced by First Chicago from time to time, changing 
when and as said corporate base rate changes. 
 
      "Default" means an event described in Article VII. 
 
      "Designated Employee" is defined in Section 2.13. 
 
      "ERISA" means the Employee Retirement Income Security Act of 1974, as 
amended from time to time, and any rule or regulation issued thereunder. 
 
      "Eurodollar Advance" means an Advance which bears interest at a 
Eurodollar Rate. 
 
      "Eurodollar Base Rate" means, with respect to a Eurodollar Advance for 
the relevant Eurodollar Interest Period, the rate determined by the Agent to 
be the rate at which deposits in U.S. dollars are offered by First Chicago 
to first-class banks in the London interbank market at approximately 11 a.m. 
(London time) two Business Days prior to the first day of such Eurodollar 
Interest Period, in the approximate amount of First Chicago's relevant 
Eurodollar Loan and having a maturity approximately equal to such Eurodollar 
Interest Period. 
 
      "Eurodollar Interest Period" means, with respect to a Eurodollar 
Advance, a period of one, two, three or six months, commencing on a Business 
Day selected by the Borrower pursuant to this Agreement.  Such Eurodollar 
Interest Period shall end on (but exclude) the day which corresponds 
numerically to such date one, two, three or six months thereafter, provided, 
however, that if there is no such numerically corresponding day in such 
next, second, third or sixth succeeding month, such Eurodollar Interest 
Period shall end on the last Business Day of such next, second, third or 
sixth succeeding month.  If a Eurodollar Interest Period would otherwise end 
on a day which is not a Business Day, such Eurodollar Interest Period shall 
end on the next succeeding Business Day, provided, however, that if said 
next succeeding Business Day falls in a new calendar month, such Eurodollar 
Interest Period shall end on the immediately preceding Business Day. 
 
      "Eurodollar Loan" means a Loan which bears interest at a Eurodollar 
Rate. 
 
      "Eurodollar Rate" means, with respect to a Eurodollar Advance for the 
relevant Eurodollar Interest Period, the sum of (i) the quotient of (a) the 
Eurodollar Base Rate applicable to such Eurodollar Interest Period, divided 
by (b) one minus the Reserve Requirement (expressed as a decimal) applicable 
to such Eurodollar Interest Period, plus (ii) the Applicable Margin.  The 
Eurodollar Rate shall be rounded to the next higher multiple of 1/16 of 1% 
if the rate is not such a multiple. 
 
      "Existing Agreement" means that certain Credit Agreement dated as of 
October 14, 1994 among the Borrower, the lenders named therein and The First 
National Bank of Chicago as agent, as amended. 
 
      "Federal Funds Effective Rate" means, for any day, an interest rate 
per annum 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 for such day (or, if such 
day is not a Business Day, for the immediately preceding Business Day) by 
the Federal Reserve Bank of New York, or, if such rate is not so published 
for any day which is a Business Day, the average of the quotations at 
approximately 10 a.m. (Chicago time) on such day on such transactions 
received by the Agent from three Federal funds brokers of recognized 
standing selected by the Agent in its sole discretion.  
 
      "Federal Reserve Board" means the Board of Governors of the Federal 
Reserve System, or its delegate, the Federal Reserve Bank of Boston.  
 
      "First Chicago" means The First National Bank of Chicago in its 
individual capacity, and its successors. 
 
      "Floating Rate" means, for any day, a rate per annum equal to (i) the 
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each 
case changing when and as the Alternate Base Rate changes. 
 
      "Floating Rate Advance" means an Advance which bears interest at the 
Floating Rate. 
 
      "Floating Rate Loan" means a Loan which bears interest at the Floating 
Rate. 
 
      "Funded Debt" means all Indebtedness for borrowed money of the 
Borrower having a maturity (or extendible to a maturity at the option of the 
Borrower) of more than one year from the date of creation thereof. 
 
      "Indebtedness" of a Person means such Person's (i) obligations for 
borrowed money, (ii) obligations representing the deferred purchase price of 
Property or services (other than accounts payable arising in the ordinary 
course of such Person's business payable on terms customary in the trade), 
(iii) obligations, whether or not assumed, secured by Liens or payable out 
of the proceeds or production from property now or hereafter owned or 
acquired by such Person, (iv) obligations which are evidenced by notes, 
acceptances, or other instruments, (v) Capitalized Lease Obligations, (vi) 
Rate Hedging Obligations, (vii) Contingent Obligations, and 
(viii)obligations for which such Person is obligated pursuant to a Letter of 
Credit. 
 
      "Investment" of a Person means any loan, advance (other than 
commission, travel and similar advances to officers and employees made in 
the ordinary course of business), extension of credit (other than accounts 
receivable arising in the ordinary course of business on terms customary in 
the trade), deposit account or contribution of capital by such Person to any 
other Person or any investment in, or purchase or other acquisition of, any 
assets or any stock, partnership interests, notes, debentures or other 
securities of any other Person made by such Person. 
 
      "Lenders" means the lending institutions listed on the signature pages 
of this Agreement and their respective successors and assigns. 
 
      "Lending Installation" means, with respect to a Lender or the Agent, 
any office, branch, subsidiary or affiliate of such Lender or the Agent. 
 
      "Letter of Credit" of a Person means a letter of credit or similar 
instrument which is issued upon the application of such Person or upon which 
such Person is an account party or for which such Person is in any way 
liable. 
 
      "Lien" means any lien (statutory or other), mortgage, pledge, 
hypothecation, assignment, deposit arrangement, encumbrance or preference, 
priority or other security agreement or preferential arrangement of any kind 
or nature whatsoever (including, without limitation, the interest of a 
vendor or lessor under any conditional sale, Capitalized Lease or other 
title retention agreement). 
 
      "Loan" means, with respect to a Lender, such Lender's portion of any 
Advance. 
 
      "Loan Documents" means this Agreement and the Notes. 
 
      "Material Adverse Effect" means a material adverse effect on (i) the 
business, Property, condition (financial or otherwise), results of 
operations, or prospects of the Borrower and its Subsidiaries taken as a 
whole, (ii) the ability of the Borrower to perform its obligations under the 
Loan Documents, or (iii) the validity or enforceability of any of the Loan 
Documents or the rights or remedies of the Agent or the Lenders thereunder. 
 
      "Moody's" means Moody's Investors Service Inc. or any successor 
corporation thereto. 
 
      "Net Income" means the Borrower's net income determined in a manner 
consistent with the Agreement Accounting Principles used in preparing the 
Borrower's quarterly report on Form 10-Q for the quarter ended September 30, 
1996. 
 
      "Non-Performing Assets" means the total of (i) Non-Performing Loans, 
(ii) Other Real Estate Owned and (iii) without duplication for amounts 
included as Other Real Estate Owned, property acquired pursuant to in 
substance foreclosures. 
 
      "Non-Performing Loans" means (i) the total of loans which are placed 
on a nonaccrual status, (ii) the total of loans which are past due 90 days 
or more and are still accruing, and (iii) the total of loans and leases 
restructured and in compliance with modified terms, in each case determined 
in a manner consistent with that used in preparing the Borrower's September 
30, 1996 Consolidated Financial Statements, which amounts are currently 
reported on line 10 of Schedule HC-H thereto for items (i) and (ii) above 
and on line M(1)(f) of Schedule HC-B thereto for item (iii) above. 
 
      "Note" means a promissory note, in substantially the form of Exhibit 
"A" hereto, duly executed by the Borrower and payable to the order of a 
Lender in the amount of its Commitment, including any amendment, 
modification, renewal or replacement of such promissory note. 
 
      "Notice of Assignment" is defined in Section 12.3.2. 
 
      "Obligations" means all unpaid principal of and accrued and unpaid 
interest on the Notes, all accrued and unpaid fees and all expenses, 
reimbursements, indemnities and other obligations of the Borrower to the 
Lenders or to any Lender, the Agent or any indemnified party hereunder 
arising under the Loan Documents. 
 
      "Other Real Estate Owned" means Other Real Estate Owned as defined in 
12 C.F.R. [SECTION]7.3025 (1989), as such regulation may be amended or supple-
mented from time to time, determined in a manner consistent with that used in 
preparing the Borrower's September 30, 1996 Consolidated Financial 
Statements, which amount is currently reported on lines 7(a) and 7(b) of 
Schedule HC thereto. 
 
      "Parent Company Only Financial Statements" means the Parent Company 
Only Financial Statements for Bank Holding Companies With Total Consolidated 
Assets of $150 Million or More, or With More Than One Subsidiary Bank--FR Y-
9 LP, as such report may be amended or modified from time to time, and any 
similar report required to be filed by the Borrower. 
 
      "Participants" is defined in Section 12.2.1. 
 
      "Payment Date" means the last day of each March, June, September and 
December. 
 
      "PBGC" means the Pension Benefit Guaranty Corporation, or any 
successor thereto. 
 
      "Permitted Banking Subsidiary Indebtedness" means obligations incurred 
by any Banking Subsidiary in the ordinary course of business in such 
circumstances as may be incidental or usual in carrying on the banking or 
trust business of a bank or trust company, including, solely by way of 
example and not for purposes of limitation, obligations incurred in 
connection with (i) any deposits with or funds collected by such Subsidiary, 
(ii) any banker's acceptance credit of such Subsidiary, (iii) any check, 
note, certificate of deposit, instrument, money or Letter of Credit issued 
by such Subsidiary, (iv) any check, note, certificate of deposit, money 
order, traveler's check, draft or bill of exchange issued, accepted or 
endorsed by such Subsidiary, (v) any discount with, borrowing from, or other 
obligation to, any Federal Reserve Bank or any Federal Home Loan Bank, (vi) 
any agreement made by such Subsidiary to purchase or repurchase securities, 
loans or Federal funds or any interest or participation in any thereof, 
(vii) any guarantee or similar obligation incurred by such Subsidiary in the 
ordinary course of its banking or trust business, (viii) any transaction in 
the nature of an extension of credit, whether in the form of a commitment or 
otherwise, undertaken by such Subsidiary for the account of a third party 
with the application of the same banking considerations and legal lending 
limits that would be applicable if the transaction were a loan to such 
party, (ix) any transaction in which such Subsidiary acts solely in the 
fiduciary or agency capacity, (x) Rate Hedging Obligations incurred in the 
ordinary course of business, and (xi) other short-term liabilities similar 
to those enumerated in clauses (i) and (vi) above, including United States 
Treasury tax and loan borrowings. 
 
      "Person" means any natural person, corporation, firm, joint venture, 
partnership, association, enterprise, trust or other entity or organization, 
or any government or political subdivision or any agency, department or 
instrumentality thereof. 
 
      "Plan" means an employee pension benefit plan which is covered by 
Title IV of ERISA or subject to the minimum funding standards under Section 
412 of the Code as to which the Borrower or any member of the Controlled 
Group may have any liability. 
 
      "Property" of a Person means any and all property, whether real, 
personal, tangible, intangible, or mixed, of such Person, or other assets 
owned, leased or operated by such Person. 
 
      "Purchasers" is defined in Section 12.3.1. 
 
      "Rate Hedging Obligations" of a Person means any and all obligations 
of such Person, whether absolute or contingent and howsoever and whensoever 
created, arising, evidenced or acquired (including all renewals, extensions 
and modifications thereof and substitutions therefor), under (i) any and all 
agreements, devices or arrangements designed to protect at least one of the 
parties thereto from the fluctuations of interest rates, exchange rates or 
forward rates applicable to such party's assets, liabilities or exchange 
transactions, including, but not limited to, dollar-denominated or cross-
currency interest rate exchange agreements, forward currency exchange 
agreements, interest rate cap or collar protection agreements, forward rate 
currency or interest rate options, puts and warrants, and (ii) any and all 
cancellations, buy backs, reversals, terminations or assignments of any of 
the foregoing. 
 
      "Rating" means the issuer rating assigned to the Borrower by Thomson, 
Standard & Poor's, Moody's or any other rating agency approved by the 
Lenders; provided that if such rating is received from (i) one rating 
agency, then that rating will be the Rating, (ii) two rating agencies, then 
the lowest rating will be the Rating, and (iii) three rating agencies, then 
(a) if two of the three rating agencies agree, then that rating will be the 
Rating and (b) if none of the three agencies agree, then the middle rating 
will be the Rating. 
 
      "Regulation D" means Regulation D of the Board of Governors of the 
Federal Reserve System as from time to time in effect and any successor 
thereto or other regulation or official interpretation of said Board of 
Governors relating to reserve requirements applicable to member banks of the 
Federal Reserve System. 
 
      "Regulation U" means Regulation U of the Board of Governors of the 
Federal Reserve System as from time to time in effect and any successor or 
other regulation or official interpretation of said Board of Governors 
relating to the extension of credit by banks for the purpose of purchasing 
or carrying margin stocks applicable to member banks of the Federal Reserve 
System. 
 
      "Reportable Event" means a reportable event as defined in Section 4043 
of ERISA and the regulations issued under such section, with respect to a 
Plan, excluding, however, such events as to which the PBGC by regulation 
waived the requirement of Section 4043(a) of ERISA that it be notified 
within 30 days of the occurrence of such event, provided, however, that a 
failure to meet the minimum funding standard of Section 412 of the Code and 
of Section 302 of ERISA shall be a Reportable Event regardless of the 
issuance of any such waiver of the notice requirement in accordance with 
either Section 4043(a) of ERISA or Section 412(d) of the Code. 
 
      "Required Lenders" means (i) prior to the Closing Date, Lenders in the 
aggregate having at least 66 2/3% of the Aggregate Commitment or, (ii) on 
and after the Closing Date, Lenders in the aggregate holding at least 66 
2/3% of the aggregate unpaid principal amount of the outstanding Loans. 
 
      "Reserve Requirement" means, with respect to a Eurodollar Interest 
Period, the maximum aggregate reserve requirement (including all basic, 
supplemental, marginal and other reserves) which is imposed under Regulation 
D on Eurocurrency liabilities. 
 
      "Return on Average Assets" means Annualized Net Income divided by 
Total Consolidated Average Assets. 
 
      "Section" means a numbered section of this Agreement, unless another 
document is specifically referenced. 
 
      "Single Employer Plan" means a Plan maintained by the Borrower or any 
member of the Controlled Group for employees of the Borrower or any member 
of the Controlled Group. 
 
      "Standard & Poor's" means Standard & Poor's Corporation or any 
successor corporation thereto. 
 
      "Subsidiary" of a Person means (i) any corporation more than 50% of 
the outstanding securities having ordinary voting power of which shall at 
the time be owned or controlled, directly or indirectly, by such Person or 
by one or more of its Subsidiaries or by such Person and one or more of its 
Subsidiaries, or (ii) any partnership, association, joint venture or similar 
business organization more than 50% of the ownership interests having 
ordinary voting power of which shall at the time be so owned or controlled.  
Notwithstanding the foregoing, "Subsidiary" of the Borrower shall also mean 
any Banking Subsidiary.   Unless otherwise expressly provided, all 
references herein to a "Subsidiary" shall mean a Subsidiary of the Borrower. 
 
      "Substantial Portion" means, with respect to the Property of the 
Borrower and its Subsidiaries, Property which (i) represents more than 10% 
of the consolidated assets of the Borrower and its Subsidiaries as would be 
shown in the consolidated financial statements of the Borrower and its 
Subsidiaries as at the beginning of the twelve-month period ending with the 
month in which such determination is made, or (ii) is responsible for more 
than 10% of the consolidated net sales or of the consolidated net income of 
the Borrower and its Subsidiaries as reflected in the financial statements 
referred to in clause (i) above. 
 
      "Tangible Equity Capital" means (i) Total Equity Capital, minus (ii) 
goodwill (determined in a manner consistent with that used in preparing the 
Borrower's September 30, 1996 Consolidated Financial Statements, which 
amount is currently reported on line 10(c) of Schedule HC thereof). 
 
      "Termination Date" means December 16, 2001. 
 
      "Thomson" means Thomson Bankwatch, Inc. or any successor corporation 
thereto. 
 
      "Thrift Financial Report" means the Thrift Financial Report, as such 
report may be amended or modified from time to time, and any similar report 
required to be filed by any Banking Subsidiary. 
 
      "Total Consolidated Assets" means the Borrower's total consolidated 
assets determined in a manner consistent with the Agreement Accounting 
Principles used in preparing the Borrower's quarterly report on Form 10-Q 
for the quarter ended September 30, 1996. 
 
      "Total Consolidated Average Assets" means the sum of the actual Total 
Consolidated Assets for each day in the year-to-date period divided by the 
actual number of days in the year-to-date period. 
 
      "Total Equity Capital" means the Borrower's total equity capital 
determined in a manner consistent with that used in preparing the Borrower's 
September 30, 1996 Consolidated Financial Statements, which amount is 
currently reported on line 27(h) of Schedule HC thereof. 
 
      "Transferee" is defined in Section 12.4. 
 
      "Type" means, with respect to any Advance, its nature as a Floating 
Rate Advance or Eurodollar Advance. 
   
      "Unfunded Liabilities" means the amount (if any) by which the present 
value of all vested nonforfeitable benefits under all Single Employer Plans 
exceeds the fair market value of all such Plan assets allocable to such 
benefits, all determined as of the then most recent valuation date for such 
Plans. 
 
      "Unmatured Default" means an event which but for the lapse of time or 
the giving of notice, or both, would constitute a Default. 
 
      "Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of 
the outstanding voting securities of which shall at the time be owned or 
controlled, directly or indirectly, by such Person or one or more Wholly-
Owned Subsidiaries of such Person, or by such Person and one or more Wholly-
Owned Subsidiaries of such Person, or (ii) any partnership, association, 
joint venture or similar business organization 100% of the ownership 
interests having ordinary voting power of which shall at the time be so 
owned or controlled. 
 
      The foregoing definitions shall be equally applicable to both the 
singular and plural forms of the defined terms. 
 
                                 ARTICLE II 
 
                                 THE CREDITS
                                 -----------
 
      2.1.   Commitment.  Each Lender severally agrees, on the terms and 
conditions set forth in this Agreement, to make a Loan to the Borrower on 
the Closing Date in an amount equal to its Commitment.  Any payments or 
prepayments (whether mandatory or optional) made by the Borrower with 
respect to the Loans may not be reborrowed. 
 
      2.2.   Required Payments; Termination Date.  On each Payment Date, 
commencing on December 31, 1996, and on the Termination Date, the Borrower 
shall make a mandatory payment on the Loans outstanding in an amount equal 
to the lesser of (i) $650,000, and (ii) the aggregate principal amount of 
the Loans outstanding.  All unpaid Obligations shall be paid in full by the 
Borrower on the Termination Date. 
 
      2.3.   Ratable Loans.  Each Advance hereunder shall consist of Loans 
made from the several Lenders ratably in proportion to the ratio that their 
respective Commitments bear to the Aggregate Commitment. 
 
      2.4.   Types of Advances.   The Advances may be Floating Rate Advances 
or Eurodollar Advances, or a combination thereof, selected by the Borrower 
in accordance with Sections 2.8 and 2.9. 
 
      2.5.   Applicable Margin. The Applicable Margin for Advances shall be 
based on the Borrower's Rating and shall be determined in accordance with 
the table set forth below.  The Applicable Margin shall be adjusted on the 
earlier of the date of announcement or the date of publication by the 
respective rating agencies of a change in the Rating (the "Adjustment 
Date"), and shall apply to all outstanding Advances from and after such 
Adjustment Date to the next Adjustment Date. In the event that the Borrower 
shall at any time cease to be rated by Thomson Bankwatch, Inc. or any other 
rating agency which is acceptable to the Lenders, the maximum Applicable 
Margin shall apply. 


<TABLE>
<CAPTION>

 
                Rating                           Applicable Margin 
                ------                           -----------------
 					                                         Floating
                Standard                         Rate     Eurodollar 
Thomson         & Poor's       Moody's         Advances   Advances 
--------------------------------------------------------------------
 
<S>             <C>            <C>             <C>        <C>
B or above      AA or above    Aa2 or above    0.00%      1.50% 
B/C             A or above     A2 or above     0.00%      1.60% 
C               BBB or above   Baa2 or above   0.00%      1.80% 
C/D             BB or above    Ba2 or above    0.00%      2.00% 
D               B or above     B2 or above     0.00%      2.50% 
D/E or below    B- or below    B3 or below     0.00%      3.00% 
 or No Rating 

</TABLE>


      2.6.   Minimum Amount of Each Advance.  Each Eurodollar  Advance shall 
be in the minimum amount of $1,000,000 (and in multiples of $100,000 if in 
excess thereof), and each Floating Rate Advance shall be in the minimum 
amount of $500,000 (and in multiples of $100,000 if in excess thereof), 
provided, however, that any Floating Rate Advance may be in the amount of 
the unused Aggregate Commitment. 
 
      2.7.   Optional Principal Payments.  The Borrower may from time to 
time pay, without penalty or premium, all outstanding Floating Rate 
Advances, or, in a minimum aggregate amount of $500,000 or any integral 
multiple of $100,000 in excess thereof, any portion of the outstanding 
Floating Rate Advances upon two Business Days' prior notice to the Agent.  
Any payment of a Eurodollar Advance prior to the last day of the applicable 
Eurodollar Interest Period shall subject the Borrower to the indemnification 
provisions set forth in Section 3.4. Principal payments shall be applied to 
the principal installments payable under Section 2.2 in the inverse order of 
maturity. 
 
      2.8.   Method of Selecting Types and Eurodollar Interest Periods for 
New Advances.  The Borrower shall select the Type of Advance and, in the 
case of each Eurodollar Advance, the Eurodollar Interest Period applicable 
to each Advance from time to time.  The Borrower shall give the Agent 
irrevocable notice (a "Borrowing Notice") not later than 10:00 a.m. (Chicago 
time) at least one Business Day before the Borrowing Date of each Floating 
Rate Advance, and three Business Days before the Borrowing Date for each 
Eurodollar Advance, specifying: 
 
      (i)    the Borrowing Date, which shall be a Business Day, of such 
             Advance, 
 
      (ii)   the aggregate amount of such Advance, 
 
      (iii)  the Type of Advance selected, and 
 
      (iv)   in the case of each Eurodollar Advance, the Eurodollar Interest 
             Period applicable thereto. 
 
Not later than noon (Chicago time) on each Borrowing Date, each Lender shall 
make available its Loan or Loans, in funds immediately available in Chicago 
to the Agent at its address specified pursuant to Article XIII.  The Agent 
will make the funds so received from the Lenders available to the Borrower 
at the Agent's aforesaid address. 
 
      2.9.   Conversion and Continuation of Outstanding Advances.  Floating 
Rate Advances shall continue as Floating Rate Advances unless and until such 
Floating Rate Advances are converted into Eurodollar Advances.  Each 
Eurodollar Advance shall continue as a Eurodollar Advance until the end of 
the then applicable Eurodollar Interest Period therefor, at which time such 
Eurodollar Advance shall be automatically converted into a Floating Rate 
Advance unless the Borrower shall have given the Agent a 
Conversion/Continuation Notice requesting that, at the end of such 
Eurodollar Interest Period, such Eurodollar Advance either continue as a 
Eurodollar Advance for the same or another Eurodollar Interest Period or be 
converted into a Floating Rate Advance.  Subject to the terms of Section 
2.6, the Borrower may elect from time to time to convert all or any part of 
an Advance of any Type into another Type of Advance; provided that any 
conversion of any Eurodollar Advance shall be made on, and only on, the last 
day of the Eurodollar Interest Period applicable thereto.  The Borrower 
shall give the Agent irrevocable notice (a "Conversion/Continuation Notice") 
of each conversion of an Advance or continuation of a Eurodollar Advance not 
later than 10:00 a.m. (Chicago time) at least one Business Day, in the case 
of a conversion into a Floating Rate Advance, or three Business Days, in the 
case of a conversion into or continuation of a Eurodollar Advance, prior to 
the date of the requested conversion or continuation, specifying: 
 
      (i)    the requested date which shall be a Business Day, of such 
             conversion or continuation; 
 
      (ii)   the aggregate amount and Type of the Advance which is to be
             converted or continued; and 
 
      (iii)  the amount and Type of Advance into which such Advance is to be 
             converted or continued and, in the case of a conversion into or
             continuation of a Eurodollar Advance, the duration of the
             Eurodollar Interest Period applicable thereto. 
 
      2.10.  Changes in Interest Rate, etc.  Each Floating Rate Advance 
shall bear interest on the outstanding principal amount thereof, for each 
day from and including the date such Advance is made or is converted from a 
Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.9 to 
but excluding the date it becomes due or is converted into a Eurodollar 
Advance pursuant to Section 2.9 hereof, at a rate per annum equal to the 
Floating Rate for such day.  Changes in the rate of interest on that portion 
of any Advance maintained as a Floating Rate Advance will take effect 
simultaneously with each change in the Alternate Base Rate.  Each Eurodollar 
Advance shall bear interest from and including the first day of the 
Eurodollar Interest Period applicable thereto to (but not including) the 
last day of such Eurodollar Interest Period at the interest rate determined 
as applicable to such Eurodollar Advance.  No Eurodollar Interest Period may 
end after the  Termination Date.  The Borrower shall select Eurodollar 
Interest Periods so that it is not necessary to repay any portion of a 
Eurodollar Advance prior to the last day of the applicable Eurodollar 
Interest Period in order to make a mandatory repayment required pursuant to 
Section 2.2. 
 
      2.11.  Rates Applicable After Default.  Notwithstanding anything to 
the contrary contained in Section 2.8 or 2.9, during the continuance of a 
Default or Unmatured Default the Required Lenders may, at their option, by 
notice to the Borrower (which notice may be revoked at the option of the 
Required Lenders notwithstanding any provision of Section 8.2 requiring 
unanimous consent of the Lenders to changes in interest rates), declare that 
no Advance may be made as, converted into or continued as a Eurodollar 
Advance.  During the continuance of a Default, the Required Lenders may, at 
their option, by notice to the Borrower (which notice may be revoked at the 
option of the Required Lenders notwithstanding any provision of Section 8.2 
requiring unanimous consent of the Lenders to changes in interest rates), 
declare that (i) each Eurodollar Advance shall bear interest for the 
remainder of the applicable Eurodollar Interest Period at the rate otherwise 
applicable to such Eurodollar Interest Period plus 2% per annum and (ii) 
each Floating Rate Advance shall bear interest at a rate per annum equal to 
the Floating Rate otherwise applicable to the Floating Rate Advance plus 2% 
per annum. 
 
      2.12.  Method of Payment.  All payments of the Obligations hereunder 
shall be made, without setoff, deduction, or counterclaim, in immediately 
available funds to the Agent at the Agent's address specified pursuant to 
Article XIII, or at any other Lending Installation of the Agent specified in 
writing by the Agent to the Borrower, by noon (local time) on the date when 
due and shall be applied ratably by the Agent among the Lenders.  Each 
payment delivered to the Agent for the account of any Lender shall be 
delivered promptly by the Agent to such Lender in the same type of funds 
that the Agent received at its address specified pursuant to Article XIII or 
at any Lending Installation specified in a notice received by the Agent from 
such Lender.  The Agent is hereby authorized to charge the account of the 
Borrower maintained with First Chicago for each payment of principal, 
interest and fees as it becomes due hereunder. 
 
      2.13.  Notes; Telephonic Notices.  Each Lender is hereby authorized to 
record the principal amount of each of its Loans and each repayment on the 
schedule attached to its Note, provided, however, that the failure to so 
record shall not affect the Borrower's obligations under such Note.  The 
Borrower hereby authorizes the Agent and the Lenders to extend, convert or 
continue Advances, effect selections of Types of Advances and to transfer 
funds based on telephonic notices made by any person the Agent or any Lender 
in good faith believes to be a Designated Employee (as hereinafter defined); 
provided, however, that the Agent shall telephonically confirm such notice 
prior to taking any such action.  The Borrower shall notify the Agent in 
writing of the names of the persons authorized to take any such action on 
behalf of the Borrower (each a "Designated Employee"), and shall provide the 
Agent with a specimen signature of each Designated Employee.  The Agent and 
the Lenders shall be entitled to rely conclusively on any Designated 
Employee's authority to take any such action until the Agent and the Lenders 
receive written notice to the contrary from the Borrower.  The Agent and the 
Lenders shall compare, but shall have no duty to verify, the authenticity of 
the signature appearing on any written notice given to the Agent or any 
Lender, and with respect to an oral request to take any such action, the 
Agent and the Lenders shall inquire as to, but shall have no duty to verify, 
the identity of any person representing himself as a Designated Employee.  
Neither the Agent nor any Lender shall incur any liability to the Borrower 
in acting upon any telephonic notice in the manner referred to in this 
Section 2.13.  If requested by the Agent or any Lender, the Borrower agrees 
to deliver promptly to the Agent or any such Lender a written confirmation, 
signed by an Authorized Officer, of each telephonic notice.  If the written 
confirmation differs in any material respect from the action taken by the 
Agent and the Lenders, the records of the Agent and the Lenders shall govern 
absent manifest error. 
 
      2.14.  Interest Payment Dates; Interest and Fee Basis.  Interest 
accrued on each Floating Rate Advance shall be payable on each Payment Date, 
commencing with the first such date to occur after the date hereof and at 
maturity.  Interest accrued on each Eurodollar Advance shall be payable on 
the last day of its applicable Eurodollar Interest Period, on any date on 
which the Eurodollar Advance is prepaid, whether by acceleration or 
otherwise, and at maturity.  Interest accrued on each Eurodollar  Advance 
having an Eurodollar Interest Period longer than three months shall also be 
payable on the last day of each three-month interval during such Eurodollar 
Interest Period.  Interest shall be calculated for actual days elapsed on 
the basis of a 360-day year.  Interest shall be payable for the day an 
Advance is made but not for the day of any payment on the amount paid if 
payment is received prior to noon (local time) at the place of payment.  If 
any payment of principal of or interest on an Advance shall become due on a 
day which is not a Business Day, such payment shall be made on the next 
succeeding Business Day and, in the case of a principal payment, such 
extension of time shall be included in computing interest in connection with 
such payment. 
 
      2.15.  Notification of Advances, Interest Rates and Prepayments.  
Promptly after receipt thereof, the Agent will notify each Lender of the 
contents of each Borrowing Notice, Conversion/Continuation Notice, and 
repayment notice received by it hereunder.  The Agent will notify each 
Lender of the interest rate applicable to each Eurodollar Advance promptly 
upon determination of such interest rate and will give each Lender prompt 
notice of each change in the Alternate Base Rate. 
 
      2.16.  Lending Installations.  Each Lender may book its Loans at any 
Lending Installation selected by such Lender and may change its Lending 
Installation from time to time.  All terms of this Agreement shall apply to 
any such Lending Installation and the Notes shall be deemed held by each 
Lender for the benefit of such Lending Installation.  Each Lender may, by 
written or telex notice to the Agent and the Borrower, designate a Lending 
Installation through which Loans will be made by it and for whose account 
Loan payments are to be made. 
 
      2.17.  Non-Receipt of Funds by the Agent.  Unless the Borrower or a 
Lender, as the case may be, notifies the Agent prior to the date on which it 
is scheduled to make payment to the Agent of (i) in the case of a Lender, 
the proceeds of a Loan or (ii) in the case of the Borrower, a payment of 
principal, interest or fees to the Agent for the account of the Lenders, 
that it does not intend to make such payment, the Agent may assume that such 
payment has been made.  The Agent may, but shall not be obligated to, make 
the amount of such payment available to the intended recipient in reliance 
upon such assumption.  If such Lender or the Borrower, as the case may be, 
has not in fact made such payment to the Agent, the recipient of such 
payment shall, on demand by the Agent, repay to the Agent the amount so made 
available together with interest thereon in respect of each day during the 
period commencing on the date such amount was so made available by the Agent 
until the date the Agent recovers such amount at a rate per annum equal to 
(i) in the case of payment by a Lender, the Federal Funds Effective Rate for 
such day or (ii) in the case of payment by the Borrower, the interest rate 
applicable to the relevant Loan. 
 
      2.18.  Withholding Tax Exemption. At least five Business Days prior to 
the first date on which interest or fees are payable hereunder for the 
account of any Lender, each Lender that is not incorporated under the laws 
of the United States of America, or a state thereof, agrees that it will 
deliver to each of the Borrower and the Agent two duly completed copies of 
United States Internal Revenue Service Form 1001 or 4224, certifying in 
either case that such Lender is entitled to receive payments under this 
Agreement and the Notes without deduction or withholding of any United 
States federal income taxes.  Each Lender which so delivers a Form 1001 or 
4224 further undertakes to deliver to each of the Borrower and the Agent two 
additional copies of such form (or a successor form) on or before the date 
that such form expires (currently, three successive calendar years for Form 
1001 and one calendar year for Form 4224) or becomes obsolete or after the 
occurrence of any event requiring a change in the most recent forms so 
delivered by it, and such amendments thereto or extensions or renewals 
thereof as may be reasonably requested by the Borrower or the Agent, in each 
case certifying that such Lender is entitled to receive payments under this 
Agreement and the Notes without deduction or withholding of any United 
States federal income taxes, unless an event (including without limitation 
any change in treaty, law or regulation) has occurred prior to the date on 
which any such delivery would otherwise be required which renders all such 
forms inapplicable or which would prevent such Lender from duly completing 
and delivering any such form with respect to it and such Lender advises the 
Borrower and the Agent that it is not capable of receiving payments without 
any deduction or withholding of United States federal income tax. 
 
                                 ARTICLE III 
 
                           CHANGE IN CIRCUMSTANCES
                           -----------------------
 
      3.1.   Yield Protection.  If any law or any governmental or quasi-
governmental rule, regulation, policy, guideline or directive (whether or 
not having the force of law), or any interpretation thereof, or the 
compliance of any Lender therewith, 
 
      (i)    subjects any Lender or any applicable Lending Installation to 
             any tax, duty, charge or withholding on or from payments due from
             the Borrower (excluding federal taxation of the overall net income
             of any Lender or applicable Lending Installation), or changes the
             basis of taxation of payments to any Lender in respect of its
             Loans or other amounts due it hereunder, or  
 
      (ii)   imposes or increases or deems applicable any reserve, 
             assessment, insurance charge, special deposit or similar
             requirement against assets of, deposits with or for the account
             of, or credit extended by, any Lender or any applicable Lending
             Installation (other than reserves and assessments taken into
             account in determining the interest rate applicable to Eurodollar
             Advances), or 
 
      (iii)  imposes any other condition the result of which is to increase 
             the cost to any Lender or any applicable Lending Installation of
             making, funding or maintaining loans or reduces any amount
             receivable by any Lender or any applicable Lending Installation in
             connection with loans, or requires any Lender or any applicable
             Lending Installation to make any payment calculated by reference
             to the amount of loans held or interest received by it, by an
             amount deemed material by such Lender,

then, within 15 days of demand by such Lender, the Borrower shall pay such
Lender that portion of such increased expense incurred or reduction in an
amount received which such Lender determines is attributable to making,
funding and maintaining its Loans. 

      3.2.   Changes in Capital Adequacy Regulations.  If a Lender 
determines the amount of capital required or expected to be maintained by 
such Lender, any Lending Installation of such Lender or any corporation 
controlling such Lender is increased as a result of a Change, then, within 
15 days of demand by such Lender, the Borrower shall pay such Lender the 
amount necessary to compensate for any shortfall in the rate of return on 
the portion of such increased capital which such Lender determines is 
attributable to this Agreement, its Loans or its obligation to make Loans 
hereunder (after taking into account such Lender's policies as to capital 
adequacy).  "Change" means (i) any change after the date of this Agreement 
in the Risk-Based Capital Guidelines or (ii) any adoption of or change in 
any other law, governmental or quasi-governmental rule, regulation, policy, 
guideline, interpretation, or directive (whether or not having the force of 
law) after the date of this Agreement which affects the amount of capital 
required or expected to be maintained by any Lender or any Lending 
Installation or any corporation controlling any Lender.  "Risk-Based Capital 
Guidelines" means (i) the risk-based capital guidelines in effect in the 
United States on the date of this Agreement, including transition rules, and 
(ii) the corresponding capital regulations promulgated by regulatory 
authorities outside the United States implementing the July 1988 report of 
the Basle Committee on Banking Regulation and Supervisory Practices Entitled 
"International Convergence of Capital Measurements and Capital Standards," 
including transition rules, and any amendments to such regulations adopted 
prior to the date of this Agreement. 
 
      3.3.   Availability of Types of Advances.  If any Lender determines 
that maintenance of its Eurodollar Loans at a suitable Lending Installation 
would violate any applicable law, rule, regulation, or directive, whether or 
not having the force of law, or if the Required Lenders determine that (i) 
deposits of a type and maturity appropriate to match fund Eurodollar 
Advances are not available or (ii) the interest rate applicable to a Type of 
Advance does not accurately reflect the cost of making or maintaining such 
Advance, then the Agent shall suspend the availability of the affected Type 
of Advance and require any Eurodollar Advances to be repaid. 
 
      3.4.   Funding Indemnification.  If any payment of a Eurodollar 
Advance occurs on a date which is not the last day of the applicable 
Eurodollar Interest Period, whether because of acceleration, prepayment or 
otherwise, or a Eurodollar Advance is not made on the date specified by the 
Borrower for any reason other than default by the Lenders, the Borrower will 
indemnify each Lender for any loss or cost incurred by it resulting 
therefrom, including, without limitation, any loss or cost in liquidating or 
employing deposits acquired to fund or maintain the Eurodollar  Advance. 
 
      3.5.   Lender Statements; Survival of Indemnity. To the extent 
reasonably possible, each Lender shall designate an alternate Lending 
Installation with respect to its Eurodollar  Loans to reduce any liability 
of the Borrower to such Lender under Sections 3.1 and 3.2 or to avoid the 
unavailability of a Type of Advance under Section 3.3, so long as such 
designation is not disadvantageous to such Lender.  Each Lender shall 
deliver a written statement of such Lender as to the amount due, if any, 
under Sections 3.1, 3.2 or 3.4.  Such written statement shall set forth in 
reasonable detail the calculations upon which such Lender determined such 
amount and shall be final, conclusive and binding on the Borrower in the 
absence of manifest error.  Determination of amounts payable under such 
Sections in connection with a Eurodollar  Loan shall be calculated as though 
each Lender funded its Eurodollar Loan through the purchase of a deposit of 
the type and maturity corresponding to the deposit used as a reference in 
determining the Eurodollar Rate applicable to such Loan, whether in fact 
that is the case or not.  Unless otherwise provided herein, the amount 
specified in the written statement shall be payable on demand after receipt 
by the Borrower of the written statement.  The obligations of the Borrower 
under Sections 3.1, 3.2 and 3.4 shall survive payment of the Obligations and 
termination of this Agreement. 
 
                                 ARTICLE IV 
 
                            CONDITIONS PRECEDENT
                            --------------------
 
      4.1.   Initial Advance. 
 
      4.1.1. The Lenders shall not be required to make the initial Advance 
hereunder unless the Borrower has furnished to the Agent with sufficient 
copies for the Lenders: 
 
      (i)    Copies of the articles of incorporation of the Borrower, 
             together with all amendments, and a certificate of good standing,
             both certified by the appropriate governmental officer in its
             jurisdiction of incorporation. 
 
      (ii)   Copies, certified by the Secretary or Assistant Secretary of 
             the Borrower, of its by-laws. 
 
      (iii)  An incumbency certificate, executed by the Secretary or 
             Assistant Secretary of the Borrower, which shall identify by
             name and title and bear the signature of the officers of the
             Borrower authorized to sign the Loan Documents and to make
             borrowings hereunder, upon which certificate the Agent and the
             Lenders shall be entitled to rely until informed of any change in
             writing by the Borrower. 
 
      (iv)   A certificate, signed by the chief financial officer of the 
             Borrower, stating that on the initial Borrowing Date no Default
             or Unmatured Default has occurred and is continuing. 
 
      (v)    A written opinion of the Borrower's counsel, addressed to the 
             Lenders in substantially the form of Exhibit "B" hereto. 
 
      (vi)   Notes payable to the order of each of the Lenders. 
 
      (vii)  Written money transfer instructions, in substantially the form 
             of Exhibit "E" hereto, addressed to the Agent and signed by an
             Authorized Officer, together with such other related money
             transfer authorizations as the Agent may have reasonably
             requested. 
 
      (viii) Such other documents as any Lender or its counsel may have 
             reasonably requested. 
 
      4.1.2. The Lenders shall not be required to make the initial Advance 
hereunder, unless prior to or concurrently with the making of the initial 
Advance hereunder, the Existing Agreement shall have been terminated and the 
Borrower shall have paid to the lenders and the agent thereunder any and all 
unpaid principal of and accrued and unpaid interest on the notes evidencing 
the obligations thereunder, and any and all other obligations of the 
Borrower thereunder arising under or in connection with the Existing 
Agreement. 
 
                                  ARTICLE V 
 
                       REPRESENTATIONS AND WARRANTIES
                       ------------------------------
 
      The Borrower represents and warrants to the Lenders that as of the 
Closing Date: 
 
      5.1.   Corporate Existence and Standing.  Each of the Borrower and its 
Subsidiaries is a corporation duly incorporated, validly existing and in 
good standing under the laws of its jurisdiction of incorporation and has 
all requisite authority to conduct its business in each jurisdiction in 
which its business is conducted, except where the failure to obtain such 
authority would not have a Material Adverse Effect. 
 
      5.2.   Authorization and Validity.  The Borrower has the corporate 
power and authority and legal right to execute and deliver the Loan 
Documents and to perform its obligations thereunder.  The execution and 
delivery by the Borrower of the Loan Documents and the performance of its 
obligations thereunder have been duly authorized by proper corporate 
proceedings, and the Loan Documents constitute legal, valid and binding 
obligations of the Borrower enforceable against the Borrower in accordance 
with their terms, except as enforceability may be limited by bankruptcy, 
insolvency or similar laws affecting the enforcement of creditors' rights 
generally. 
 
      5.3.   No Conflict; Government Consent.  Neither the execution and 
delivery by the Borrower of the Loan Documents, nor the consummation of the 
transactions therein contemplated, nor compliance with the provisions 
thereof will violate any law, rule, regulation, order, writ, judgment, 
injunction, decree or award binding on the Borrower or any of its 
Subsidiaries or the Borrower's or any Subsidiary's articles of incorporation 
or by-laws or the provisions of any indenture, instrument or agreement to 
which the Borrower or any of its Subsidiaries is a party or is subject, or 
by which it, or its Property, is bound, or conflict with or constitute a 
default thereunder, or result in the creation or imposition of any Lien in, 
of or on the Property of the Borrower or a Subsidiary pursuant to the terms 
of any such indenture, instrument or agreement.  No order, consent, 
approval, license, authorization, or validation of, or filing, recording or 
registration with, or exemption by, any governmental or public body or 
authority, or any subdivision thereof, is required to authorize, or is 
required in connection with the execution, delivery and performance of, or 
the legality, validity, binding effect or enforceability of, any of the Loan 
Documents. 
 
      5.4.   Financial Statements.  The December 31, 1995 and September 30, 
1996 consolidated financial statements of the Borrower and its Subsidiaries 
heretofore delivered to the Lenders were prepared in accordance with 
generally accepted accounting principles in effect on the date such 
statements were prepared and fairly present the consolidated financial 
condition and operations of the Borrower and its Subsidiaries at such date 
and the consolidated results of their operations for the period then ended. 
 
      5.5.   Material Adverse Change.  Since September 30, 1996, there has 
been no change in the business, Property, prospects, condition (financial or 
otherwise) or results of operations of the Borrower and its Subsidiaries 
which could have a Material Adverse Effect. 
 
      5.6.   Taxes.  The Borrower and its Subsidiaries have filed all United 
States federal tax returns and all other tax returns which are required to 
be filed and have paid all taxes due pursuant to said returns or pursuant to 
any assessment received by the Borrower or any of its Subsidiaries, except 
such taxes, if any, as are being contested in good faith and as to which 
adequate reserves have been provided.  The United States income tax returns 
of the Borrower and its Subsidiaries have been audited by the Internal 
Revenue Service through the fiscal year ended December 31, 1992.  No tax 
liens have been filed and no claims are being asserted with respect to any 
such taxes.  The charges, accruals and reserves on the books of the Borrower 
and its Subsidiaries in respect of any taxes or other governmental charges 
are adequate. 
 
      5.7.   Litigation and Contingent Obligations.  Except as set forth on 
Schedule "1" hereto, there is no litigation, arbitration, governmental 
investigation, proceeding or inquiry pending or, to the knowledge of any of 
their officers, threatened against or affecting the Borrower or any of its 
Subsidiaries which could have a Material Adverse Effect.  Except as set 
forth on Schedule "1" hereto, the Borrower has no material contingent 
obligations not provided for or disclosed in the financial statements 
referred to in Section 5.4. 
 
      5.8.   Subsidiaries.  Schedule "2" hereto contains an accurate list of 
all of the presently existing Subsidiaries of the Borrower, setting forth 
their respective jurisdictions of incorporation and the percentage of their 
respective capital stock owned by the Borrower or other Subsidiaries.  All 
of the issued and outstanding shares of capital stock of such Subsidiaries 
have been duly authorized and issued and are fully paid and non-assessable. 
 
      5.9.   ERISA.  There are no Unfunded Liabilities.  Each Plan complies 
in all material respects with all applicable requirements of law and 
regulations, no Reportable Event has occurred with respect to any Plan, 
neither the Borrower nor any other members of the Controlled Group has 
withdrawn from any Plan or initiated steps to do so, and no steps have been 
taken to reorganize or terminate any Plan. 
 
      5.10.  Accuracy of Information.  No information, exhibit or report 
furnished by the Borrower or any of its Subsidiaries to the Agent or to any 
Lender in connection with the negotiation of, or compliance with, the Loan 
Documents contained any material misstatement of fact or omitted to state a 
material fact or any fact necessary to make the statements contained therein 
not misleading. 
 
      5.11.  Regulation U.  Margin stock (as defined in Regulation U) 
constitutes less than 25% of those assets of the Borrower and its 
Subsidiaries which are subject to any limitation on sale, pledge, or other 
restriction hereunder. 
 
      5.12.  Material Agreements.  Neither the Borrower nor any Subsidiary 
is a party to any agreement or instrument or subject to any charter or other 
corporate restriction which could have a Material Adverse Effect.  Neither 
the Borrower nor any Subsidiary is in default in the performance, observance 
or fulfillment of any of the obligations, covenants or conditions contained 
in (i) any agreement to which it is a party, which default could have a 
Material Adverse Effect or (ii) any agreement or instrument evidencing or 
governing Indebtedness. 
 
      5.13.  Compliance With Laws.  The Borrower and its Subsidiaries have 
complied with all applicable statutes, rules, regulations, orders and 
restrictions of any domestic or foreign government or any instrumentality or 
agency thereof, having jurisdiction over the conduct of their respective 
businesses or the ownership of their respective Property.  Neither the 
Borrower nor any Subsidiary has received any notice to the effect that its 
operations are not in material compliance with any of the requirements of 
applicable federal, state and local environmental, health and safety 
statutes and regulations or the subject of any federal or state 
investigation evaluating whether any remedial action is needed to respond to 
a release of any toxic or hazardous waste or substance into the environment, 
which non-compliance or remedial action could have a Material Adverse 
Effect. 
 
      5.14.  Ownership of Properties.  Except as set forth on Schedule "3" 
hereto, on the date of this Agreement, the Borrower and its Subsidiaries 
will have good title, free of all Liens other than those permitted by 
Section 6.16, to all of the Property and assets reflected in the financial 
statements as owned by it. 
 
      5.15.  Investment Company Act.  Neither the Borrower nor any 
Subsidiary thereof is an "investment company" or a company "controlled" by 
an "investment company", within the meaning of the Investment Company Act of 
1940, as amended. 
 
      5.16.  Public Utility Holding Company Act.  Neither the Borrower nor 
any Subsidiary is a "holding company" or a "subsidiary company" of a 
"holding company", or an "affiliate" of a "holding company" or of a 
"subsidiary company" of a "holding company", within the meaning of the 
Public Utility Holding Company Act of 1935, as amended. 
 
      5.17.  Solvency.  (i) Immediately after the making of the initial 
Loans hereunder, giving effect to the application of the proceeds of such 
Loans and using a valuation method agreed to by the Lenders, (a) the fair 
value of the assets of the Borrower and the Subsidiaries on a consolidated 
basis, at a fair valuation, will exceed the debts and liabilities, 
subordinated, contingent or otherwise, of the Borrower and the Subsidiaries 
on a consolidated basis; (b) the present fair saleable value of the property 
of the Borrower and the Subsidiaries on a consolidated basis will be greater 
than the amount that will be required to pay the probable liability of the 
Borrower and the Subsidiaries on a consolidated basis on their debts and 
other liabilities, subordinated, contingent or otherwise, as such debts and 
other liabilities become absolute and matured; (c) the Borrower and the 
Subsidiaries on a consolidated basis will be able to pay their debts and 
liabilities, subordinated, contingent or otherwise, as such debts and 
liabilities become absolute and matured; and (d) the Borrower and the 
Subsidiaries on a consolidated basis will not have unreasonably small 
capital with which to conduct the businesses in which they are engaged as 
such businesses are now conducted and are proposed to be conducted after the 
date hereof. 
 
      (ii)   The Borrower does not intend to, or to permit any of its 
Subsidiaries to, and does not believe that it or any of its Subsidiaries 
will, incur debts beyond its ability to pay such debts as they mature, 
taking into account the timing of and amounts of cash to be received by it 
or any such Subsidiary and the timing of the amounts of cash to be payable 
on or in respect of its Indebtedness or the Indebtedness of any such 
Subsidiary. 
 
                                 ARTICLE VI 
 
                                  COVENANTS
                                  ---------
 
      During the term of this Agreement, unless the Required Lenders shall 
otherwise consent in writing: 
 
      6.1.   Financial Reporting.  The Borrower will maintain, for itself 
and each Subsidiary, a system of accounting established and administered in 
accordance with generally accepted accounting principles, and furnish to the 
Lenders: 
 
      (i)    Within 90 days after the close of each of its fiscal years, an 
             unqualified audit report certified by independent certified public
             accountants, acceptable to the Lenders, prepared in accordance with
             Agreement Accounting Principles on a consolidated basis for itself
             and the Subsidiaries, including balance sheets as of the end of
             such period, related profit and loss and reconciliation of surplus
             statements, and a statement of cash flows, accompanied by (a) any
             management letter prepared by said accountants, and (b) a
             certificate of said accountants that, in the course of their
             examination necessary for their certification of the foregoing,
             they have obtained no knowledge of any Default or Unmatured
             Default, or if, in the opinion of such accountants, any Default
             or Unmatured Default shall exist, stating the nature and status
             thereof. 
 
      (ii)   Within 45 days after the close of the first three quarterly 
             periods of each of its fiscal years, for itself and the
             Subsidiaries, consolidated unaudited balance sheets as at the
             close of each such period and consolidated profit and loss and
             reconciliation of surplus statements and a statement of cash flows
             for the period from the beginning of such fiscal year to the end
             of such quarter, all certified by its chief financial officer. 
 
      (iii)  Together with the financial statements required hereunder, a 
             compliance certificate in substantially the form of Exhibit "C"
             hereto signed by its chief financial officer showing the
             calculations necessary to determine compliance with this
             Agreement and stating that no Default or Unmatured Default exists,
             or if any Default or Unmatured Default exists, stating the nature
             and status thereof. 
 
      (iv)   Simultaneously with the preparation thereof, and not more than 
             45 days after the close of each of the first three fiscal quarters
             of the Borrower and not more than 90 days after the close of the
             last fiscal quarter of the Borrower in each fiscal year (a) call
             reports for each Banking Subsidiary in the form delivered to (1)
             the Federal Reserve District Bank, the Comptroller of the Currency
             or The Federal Deposit Insurance Corporation, as the case may be,
             such reports to include the Consolidated Reports of Condition and
             Income and all schedules thereto and (2) the Office of Thrift
             Supervision, such reports to include the Thrift Financial Reports
             and all schedules thereto, and (b) the Consolidated Financial
             Statements and the Parent Company Only Financial Statements of
             the Borrower as at the end of such quarter, each in the form
             delivered to the appropriate Federal Reserve District Bank and
             each to include all schedules thereto. 
 
      (v)    Within 270 days after the close of each fiscal year, a 
             statement of the Unfunded Liabilities of each Single Employer
             Plan, certified as correct by an actuary enrolled under ERISA. 
 
      (vi)   As soon as possible and in any event within 10 days after the 
             Borrower knows that any Reportable Event has occurred with
             respect to any Plan, a statement, signed by the chief financial
             officer of the Borrower, describing said Reportable Event and the
             action which the Borrower proposes to take with respect thereto. 
 
      (vii)  As soon as possible and in any event within 10 days after 
             receipt by the Borrower, a copy of (a) any notice or claim to the
             effect that the Borrower or any of its Subsidiaries is or may be
             liable to any Person as a result of the release by the Borrower,
             any of its Subsidiaries, or any other Person of any toxic or
             hazardous waste or substance into the environment, and (b) any 
             notice alleging any violation of any federal, state or local
             environmental, health or safety law or regulation by the Borrower
             or any of its Subsidiaries, which, in either case, could reasonably
             be expected to have a Material Adverse Effect. 
 
      (viii) Promptly upon the furnishing thereof to the shareholders of the 
             Borrower, copies of all financial statements, reports and proxy
             statements so furnished. 
 
      (ix)   Promptly upon the filing thereof, copies of all registration 
             statements and annual, quarterly, monthly or other regular
             reports which the Borrower or any of its Subsidiaries files with
             the Securities and Exchange Commission. 
 
      (x)    Promptly after the Borrower's or any Subsidiary's receipt 
             thereof, unless disclosure is prohibited by the terms thereof
             and after the Borrower or such Subsidiary has in good faith
             attempted to obtain the consent of the relevant regulatory
             authority, such authority will not consent to the disclosure
             thereof, copies of any (i) notice of charges, (ii) notice of
             intent to revoke deposit insurance, (iii) cease and desist order,
             (iv) suspension or removal order, (v) memorandum of understanding,
             (vi) assessment of civil money penalties, (vii) directive relating
             to holding company activities constituting a risk to any Bank
             Subsidiary, (viii) directive, order or disapproval of any
             exception or exemption request, plan or proposal related to
             capital requirements, (ix) request that the Borrower guarantee
             any capital restoration plan of any Banking Subsidiary, (x)
             notification that any Bank Subsidiary is, or is to be treated as
             if it were, not "well capitalized" or "adequately capitalized" for
             purposes of 12 U.S.C. 1831(o) and any rules and regulations issued
             thereunder (including, without limitation, 12 C.F.R. 565.4), as
             amended, supplemented or otherwise modified from time to time;
             (xi) request or directive from any regulatory authority requiring
             any Banking Subsidiary to submit a capital restoration plan or 
             restricting the payment of dividends by any Subsidiary to the
             Borrower or any other Subsidiary. 
 
      (xi)   Such other information (including non-financial information and 
             examination reports to the extent permitted by applicable
             regulatory authorities) as the Agent or any Lender may from time
             to time reasonably request. 
 
      6.2.   Use of Proceeds.  The Borrower will, and will cause each 
Subsidiary to, use the proceeds of the Advances to refinance the Obligations 
under and as defined in the Existing Agreement and for general corporate 
purposes.  The Borrower will not, nor will it permit any Subsidiary to, use 
any of the proceeds of the Advances to purchase or carry any "margin stock" 
(as defined in Regulation U). 
 
      6.3.   Notice of Default.  The Borrower will, and will cause each 
Subsidiary to, give prompt notice in writing to the Lenders of the 
occurrence of any Default or Unmatured Default and of any other development, 
financial or otherwise, which could have a Material Adverse Effect. 
 
      6.4.   Conduct of Business.  The Borrower will, and will cause each 
Subsidiary to, carry on and conduct its business in substantially the same 
manner and in substantially the same fields of enterprise as it is presently 
conducted and to do all things necessary to remain duly incorporated, 
validly existing and in good standing as a domestic corporation in its 
jurisdiction of incorporation and maintain all requisite authority to 
conduct its business in each jurisdiction in which its business is 
conducted. 
 
      6.5.   Taxes.  The Borrower will, and will cause each Subsidiary to, 
pay when due all taxes, assessments and governmental charges and levies upon 
it or its income, profits or Property, except those which are being 
contested in good faith by appropriate proceedings and with respect to which 
adequate reserves have been set aside. 
 
      6.6.   Insurance.  The Borrower will, and will cause each Subsidiary 
to, maintain with financially sound and reputable insurance companies 
insurance on all their Property in such amounts and covering such risks as 
is consistent with sound business practice, and the Borrower will furnish to 
any Lender upon request full information as to the insurance carried. 
 
      6.7.   Compliance with Laws.  The Borrower will, and will cause each 
Subsidiary to, comply with all laws, rules, regulations, orders, writs, 
judgments, injunctions, decrees or awards to which it may be subject, except 
where the failure to so comply would not, individually or in the aggregate, 
have a Material Adverse Effect. 
 
      6.8.   Maintenance of Properties.  The Borrower will, and will cause 
each Subsidiary to, do all things necessary to maintain, preserve, protect 
and keep its Property in good repair, working order and condition, and make 
all necessary and proper repairs, renewals and replacements so that its 
business carried on in connection therewith may be properly conducted at all 
times. 
 
      6.9.   Inspection.  The Borrower will, and will cause each Subsidiary 
to, permit the Lenders, by their respective representatives and agents, to 
inspect any of the Property, corporate books and financial records of the 
Borrower and each Subsidiary, to examine and make copies of the books of 
accounts and other financial records of the Borrower and each Subsidiary, 
and to discuss the affairs, finances and accounts of the Borrower and each 
Subsidiary with, and to be advised as to the same by, their respective 
officers at such reasonable times and intervals as the Lenders may 
designate. 
 
      6.10.  Dividends.  The Borrower will not, nor will it permit any 
Subsidiary to, declare or pay any dividends on its capital stock (other than 
dividends payable in its own capital stock) or redeem, repurchase or 
otherwise acquire or retire any of its capital stock at any time 
outstanding, except that (i) any Subsidiary may declare and pay dividends to 
the Borrower or to a Wholly-Owned Subsidiary, and (ii) the Borrower may 
declare or pay dividends on its capital stock or redeem, repurchase or 
otherwise acquire or retire any of its capital stock during the period from 
September 30, 1996 to the date of calculation in an amount not to exceed the 
sum of (a) $7,000,000 plus (b) 40% of the Borrower's Consolidated Net Income 
for such period, computed on a cumulative basis for such period; provided 
that in the case of clause (ii) above, such cumulative amount is first 
reduced by any net losses incurred by the Borrower during such period; and 
provided further that in the case of each of clauses (i) and (ii) above, 
after giving effect to such event, no Default or Unmatured Default exists. 
 
      6.11.  Indebtedness.  The Borrower will not, nor will it permit any 
Subsidiary to, create, incur or suffer to exist any Indebtedness, except: 
 
      (i)    The Loans. 
 
      (ii)   Indebtedness existing on the date hereof and described in 
             Schedule "3" hereto. 
 
      (iii)  Permitted Banking Subsidiary Indebtedness. 
 
      (iv)   Contingent Obligations incurred with respect to the endorsement 
             of instruments for deposit or collection in the ordinary course
             of business. 
 
      (v)    Rate Hedging Obligations incurred by the Borrower and any 
             Subsidiary (other than any Banking Subsidiary) in the ordinary
             course of business solely for the purpose of hedging against
             interest rate risk and conducting asset/liability management and
             not for speculative purposes.  
 
      (vi)   Indebtedness owing by any Subsidiary to the Borrower or any 
             other Subsidiary in connection with Investments permitted pursuant
             to Section 6.15(iv) and 6.15(v), and Indebtedness owing by the
             Borrower to any Subsidiary in connection with Investments
             permitted pursuant to Section 6.15(v). 
 
      (vii)  In addition to Indebtedness permitted under Section 6.11(vi), 
             other Indebtedness of Banknorth Mortgage Company, Inc.; provided
             that such Indebtedness (i) does not exceed an aggregate principal
             amount of $50,000,000 at any one time outstanding, and (ii)
             consists of mortgage warehousing loans secured by the underlying
             mortgages only. 
 
      (viii) Additional Indebtedness of the Borrower and its Subsidiaries in 
             an aggregate principal amount not to exceed $20,000,000 at any
             one time outstanding. 
 
      6.12.  Merger.  The Borrower will not, nor will it permit any 
Subsidiary to, merge or consolidate with or into any other Person, except 
(i) that a Subsidiary may merge with the Borrower or a Wholly-Owned 
Subsidiary and (ii) the Borrower may merge with another Person; provided 
that (a) the Borrower is the surviving entity, and (b) immediately before 
and after the consummation of such transaction, no Default or Unmatured 
Default shall have occurred and be continuing. 
 
      6.13.  Sale of Assets.  The Borrower will not, nor will it permit any 
Subsidiary to, lease, sell or otherwise dispose of its Property, to any 
other Person except for (i) sales of loans, sales of receivables in 
connection with asset securitization financings and sales of other similar 
assets, in each case in the ordinary course of business, (ii) the 
intercompany transfers permitted pursuant to Section 6.15(iv) and 6.15(v), 
and (iii) leases, sales or other dispositions of its Property that, together 
with all other Property of the Borrower and its Subsidiaries previously 
leased, sold or disposed of (other than inventory in the ordinary course of 
business) as permitted by this Section during the twelve-month period ending 
with the month in which any such lease, sale or other disposition occurs, do 
not constitute a Substantial Portion of the Property of the Borrower and its 
Subsidiaries. 
 
      6.14.  Sale and Leaseback.  The Borrower will not, nor will it permit 
any Subsidiary to, sell or transfer any of its Property in order to 
concurrently or subsequently lease as lessee such or similar Property. 
 
      6.15.  Investments and Acquisitions.  The Borrower will not, nor will 
it permit any Subsidiary to, make or suffer to exist any Investments 
(including, without limitation, loans and advances to, and other Investments 
in, Subsidiaries), or commitments therefor, or to create any Subsidiary or 
to become or remain a partner in any partnership or joint venture, or to 
make any Acquisition of any Person, except: 
 
      (i)    Investments of any Banking Subsidiary in the ordinary course of 
             its banking or trust business and other Investments which the
             Borrower or any Banking Subsidiary is permitted to hold and
             invest in under applicable law and regulation. 
 
      (ii)   Investments of any other Subsidiary in marketable securities, 
             money-market instruments and other similar Investments which have
             been made by such Subsidiary in accordance with any investment
             policy approved by its Board of Directors in the Board's
             reasonable discretion. 
 
      (iii)  Existing Investments in Subsidiaries and other Investments in 
             existence on the date hereof and described in Schedule "2" hereto. 
 
      (iv)   Additional Investments of the Borrower in its Subsidiaries in 
             an aggregate principal amount not exceeding 12.5% of Tangible
             Equity Capital at any one time outstanding. 
 
      (v)    Investments made by any Subsidiary in or to the Borrower or any 
             Wholly-Owned Subsidiary. 
 
      (vi)   Any Acquisition; provided that (a) the total assets acquired 
             pursuant to any individual Acquisition do not exceed an aggregate
             amount of 1.5% of Tangible Equity Capital and (b) if such
             Acquisition is of a bank, savings and loan association or branch
             thereof, or corporation, it shall have been approved and
             recommended by the board of directors of such bank, savings and
             loan association or branch thereof, or corporation; and provided 
             further that (a) if such Acquisition is of a bank holding company
             and one or more banks, such bank holding company shall have a
             composite BOPEC rating of 2 or better, (b) if such Acquisition is
             of a bank only, such bank shall have a composite CAMEL rating of 2
             or better, (c) if such Acquisition is of a savings and loan
             association or a branch thereof,  either (1) such savings and loan
             association or branch thereof has a composite MACRO rating of 2 or
             better, or (2) such Acquisition is being made from the Resolution
             Trust Corporation or any successor thereof and is being assisted
             by the Resolution Trust Corporation or any successor thereof. 
 
      (vii)  The creation of (a) new Subsidiaries in connection with the 
             Acquisitions permitted under Section 6.15(vi), (b) new
             Subsidiaries of the Borrower established for the purpose of
             conducting any servicing activity for its Subsidiaries
             permissible under Section 225.22(a) of Regulation Y of the Federal
             Reserve Board or by order of the Federal Reserve Board, (c) any
             new Subsidiaries of the Borrower established for the purpose of
             conducting any non-banking activity permissible for bank holding
             companies under applicable law,  including regulations or orders
             of the Federal Reserve Board; (d) any new Subsidiaries established
             by any Banking Subsidiary of the Borrower for the purpose of
             conducting any activity permissible under applicable federal or
             state banking laws, regulations or orders; and (e) new Banking
             Subsidiaries in connection with internal reorganizations and
             restructurings among existing Banking Subsidiaries of the
             Borrower, including bank charter conversions and consolidations;
             provided, however, that promptly and in any event within five (5)
             Business Days after the later to occur of the creation of any new
             Subsidiary and the consummation of any such Acquisition (if
             applicable), the Borrower shall furnish an updated schedule of
             Subsidiaries to the Agent and the Lenders in the form of Schedule
             "2" hereto, which schedule shall set forth the respective
             jurisdictions of incorporation of the Subsidiaries and the
              percentage of their respective capital stock owned by the
              Borrower or other Subsidiaries. 
 
      6.16.  Liens.  The Borrower will not, nor will it permit any 
Subsidiary to, create, incur, or suffer to exist any Lien in, of or on the 
Property of the Borrower or any of its Subsidiaries, except: 
 
      (i)    Liens for taxes, assessments or governmental charges or levies on
             its Property if the same shall not at the time be delinquent or 
             thereafter can be paid without penalty, or are being contested in
             good faith and by appropriate proceedings and for which adequate
             reserves in accordance with generally accepted principles of
             accounting shall have been set aside on its books. 
 
      (ii)   Liens imposed by law, such as carriers', warehousemen's and 
             mechanics' liens and other similar liens arising in the ordinary
             course of business which secure payment of obligations not more
             than 60 days past due or which are being contested in good faith
             by appropriate proceedings and for which adequate reserves shall
             have been set aside on its books. 
 
      (iii)  Liens arising out of pledges or deposits under worker's 
             compensation laws, unemployment insurance, old age pensions, or
             other social security or retirement benefits, or similar
             legislation. 
 
      (iv)   Utility easements, building restrictions and such other 
             encumbrances or charges against real property as are of a nature
             generally existing with respect to properties of a similar
             character and which do not in any material way affect the
             marketability of the same or interfere with the use thereof in
             the business of the Borrower or the Subsidiaries. 
 
      (v)    Liens existing on the date hereof and described in Schedule "3" 
             hereto. 
 
      (vi)   Liens granted by a Banking Subsidiary in the ordinary course of 
             its banking and trust business in connection with any Permitted
             Banking Subsidiary Indebtedness. 
 
      (vii)  Liens to secure public funds or other pledges of funds required 
             by law to secure deposits. 
 
      (viii) Repurchase agreements, reverse repurchase agreements and other 
             similar transactions entered into by any Banking Subsidiary in
             the ordinary course of its banking or trust business. 
 
      (ix)   Liens granted by any Subsidiary to the Borrower or any other 
             Subsidiary as required pursuant to 12 U.S.C. 371c, as amended,
             supplemented or otherwise modified from time to time, and other
             Liens granted in connection with intercompany Indebtedness
             permitted under Section 6.11(vi).  
 
      (x)    Liens granted by Banknorth Mortgage Company, Inc. in connection 
             with the mortgage warehousing loans permitted under Sections 6.11
             (vii); provided, however, that such Liens are only on the
             underlying mortgages financed by such mortgage warehousing loans. 
 
      (xi)   Liens granted by the Borrower or any Subsidiary in the ordinary 
             course of business on Rate Hedging Obligations permitted under
             Section 6.11(v); provided, however, that any such Rate Hedging
             Obligation is subject to a bilateral collateral agreement between
             the Borrower or such Subsidiary, as applicable, and the other
             counterparty in respect of such Rate Hedging Obligation. 
 
      (xii)  Liens granted by any Banking Subsidiary in the ordinary course 
             of business to another bank which confirms such Banking
             Subsidiary's Letter of Credit; provided, however, that such
             Letter of Credit is secured by collateral pledged by the applicant
             thereunder, which collateral is sufficient to cover such Banking
             Subsidiary's obligations to the confirming bank.   
 
      6.17.  Fixed Asset Expenditures.  The Borrower will not, nor will it 
permit any Subsidiary to, expend, or commit to expend, at any time an amount 
in excess of the maximum amount permitted by any regulatory agency having 
jurisdiction over them in the acquisition of fixed assets. 
 
      6.18.  Consolidated Non-Performing Assets to Total Equity Capital. The 
Borrower will maintain as at the last day of each fiscal quarter a ratio of 
(i) Non-Performing Assets to (ii) Total Equity Capital of not greater than 
 .40 to 1.0. 
 
      6.19.  Funded Debt to Tangible Equity Capital.  The Borrower will 
maintain as at the last day of each fiscal quarter a ratio of (i) Funded 
Debt to (ii) Tangible Equity Capital which is less than .25 to 1.0. 
 
      6.20.  Return on Average Assets.  The Borrower will maintain as at the 
last day of each fiscal quarter a Return on Average Assets of not less than 
 .25 to 1.0. 
 
      6.21.  Capitalization.   The Borrower will ensure that each Banking 
Subsidiary will at all times be, and will at all times be treated by the 
relevant regulatory authorities as if they were,  "well-capitalized" or 
"adequately capitalized" for purposes of 12 U.S.C. 1831(o) and any rules and 
regulations issued thereunder (including, without limitation, 12 C.F.R. 
565.4), as amended, supplemented or otherwise modified from time to time. 
 
      6.22.  Capital Guidelines.   The Borrower and its Banking Subsidiaries 
shall comply at all times with any and all minimum risk-based capital 
guidelines, leverage measure capital guidelines and any other capital 
guidelines now or hereafter published by any federal or state regulatory 
authorities having jurisdiction over them. 
 
      6.23.  Affiliates.  The Borrower will not, and will not permit any 
Subsidiary to, enter into any transaction (including, without limitation, 
the purchase or sale of any Property or service) with, or make any payment 
or transfer to, any Affiliate, except in accordance with applicable legal 
and regulatory requirements governing transactions among bank or bank 
holding company affiliates, which requirements are imposed by any federal or 
state regulatory authorities having jurisdiction over the Borrower or any 
Subsidiary, including, without limitation, Sections 23A and 23B of the 
Federal Reserve Act and Regulation O of the Federal Reserve Board. 
 
      6.24.  Resolutions.   The Borrower shall furnish to the Lenders, by no 
later than December 24, 1996, a copy, certified by the Secretary or 
Assistant Secretary of the Borrower, of its Board of Directors' resolutions 
(and resolutions of other bodies, if any are deemed necessary by counsel for 
any Lender) ratifying the execution of the Loan Documents. 
 
                                 ARTICLE VII 
 
                                  DEFAULTS
                                  --------
 
      The occurrence of any one or more of the following events shall 
constitute a Default: 
 
      7.1.   Any representation or warranty made or deemed made by or on 
behalf of the Borrower or any of its Subsidiaries to the Lenders or the 
Agent under or in connection with this Agreement, any Loan, or any 
certificate or information delivered in connection with this Agreement or 
any other Loan Document shall be materially false on the date as of which 
made. 
 
      7.2.   Nonpayment of principal of any Note when due, or nonpayment of 
interest upon any Note or of any commitment fee or other obligations under 
any of the Loan Documents within five days after the same becomes due. 
 
      7.3.   The breach by the Borrower of any of the terms or provisions of 
Section 6.2, 6.10, 6.11, 6.12, 6.13, 6.14, 6.15, 6.18, 6.19, 6.20, 6.21, 
6.22, 6.23 and 6.24. 
 
      7.4.   The breach by the Borrower (other than a breach which 
constitutes a Default under Section 7.1, 7.2 or 7.3) of any of the terms or 
provisions of this Agreement which is not remedied within thirty days after 
written notice from the Agent or any Lender. 
 
      7.5.   Failure of the Borrower or any of its Subsidiaries to pay any 
Indebtedness in excess of $10,000,000 in the aggregate when due; or the 
default by the Borrower or any of its Subsidiaries in the performance of any 
term, provision or condition contained in any agreement under which any 
Indebtedness in excess of $10,000,000 in the aggregate was created or is 
governed, or any other event shall occur or condition exist, the effect of 
which is to cause, or to permit the holder or holders of such Indebtedness 
to cause, such Indebtedness to become due prior to its stated maturity; or 
any Indebtedness of the Borrower or any of its Subsidiaries in excess of 
$10,000,000 in the aggregate shall be declared to be due and payable or 
required to be prepaid (other than by a regularly scheduled payment) prior 
to the stated maturity thereof; or the Borrower or any of its Subsidiaries 
shall not pay, or admit in writing its inability to pay, its debts generally 
as they become due. 
 
      7.6.   The Borrower or any of its Subsidiaries shall (i) have an order 
for relief entered with respect to it under the Federal bankruptcy laws as 
now or hereafter in effect, (ii) make an assignment for the benefit of 
creditors, (iii) apply for, seek, consent to, or acquiesce in, the 
appointment of a receiver, custodian, trustee, examiner, liquidator or 
similar official for it or any Substantial Portion of its Property, (iv) 
institute any proceeding seeking an order for relief under the Federal 
bankruptcy laws as now or hereafter in effect or seeking to adjudicate it a 
bankrupt or insolvent, or seeking dissolution, winding up, liquidation, 
reorganization, arrangement, adjustment or composition of it or its debts 
under any law relating to bankruptcy, insolvency or reorganization or relief 
of debtors or fail to file an answer or other pleading denying the material 
allegations of any such proceeding filed against it, (v) take any corporate 
action to authorize or effect any of the foregoing actions set forth in this 
Section 7.6 or (vi) fail to contest in good faith any appointment or 
proceeding described in Section 7.7. 
 
      7.7.   Without the application, approval or consent of the Borrower or 
any of its Subsidiaries, a receiver, trustee, examiner, liquidator or 
similar official shall be appointed for the Borrower or any of its 
Subsidiaries or any Substantial Portion of its Property, or a proceeding 
described in Section 7.6(iv) shall be instituted against the Borrower or any 
of its Subsidiaries and such appointment continues undischarged or such 
proceeding continues undismissed or unstayed for a period of 30 consecutive 
days. 
 
      7.8.   Any court, government or governmental agency shall condemn, 
seize or otherwise appropriate, or take custody or control of (each a 
"Condemnation"), all or any portion of the Property of the Borrower and its 
Subsidiaries which, when taken together with all other Property of the 
Borrower and its Subsidiaries so condemned, seized, appropriated, or taken 
custody or control of, during the twelve-month period ending with the month 
in which any such Condemnation occurs, constitutes a Substantial Portion. 
 
      7.9.   The Borrower or any of its Subsidiaries shall fail within 30 
days to pay, bond or otherwise discharge any judgment or order for the 
payment of money in excess of $500,000, which is not stayed on appeal or 
otherwise being appropriately contested in good faith. 
 
      7.10.  The Unfunded Liabilities of all Single Employer Plans shall 
exceed in the aggregate $1,000,000 or any Reportable Event shall occur in 
connection with any Plan. 
 
      7.11.  The Borrower or any of its Subsidiaries shall be the subject of 
any proceeding or investigation pertaining to the release by the Borrower or 
any of its Subsidiaries, or any other Person of any toxic or hazardous waste 
or substance into the environment, or any violation of any federal, state or 
local environmental, health or safety law or regulation, which, in either 
case, could reasonably be expected to have a Material Adverse Effect. 
 
      7.12.  Any Banking Subsidiary shall cease to be insured under the 
Federal Deposit Insurance Act and any rules and regulations issued 
thereunder, as amended, supplemented or otherwise modified from time to 
time; or a cease and desist order shall be issued against the Borrower or 
any Subsidiary pursuant to 12 U.S.C. 1818(b) or (c) or any similar 
applicable provision of state law and any rules and regulations issued 
thereunder, as amended, supplemented or otherwise modified from time to 
time. 
 
      7.13.  There shall occur, with respect to any Banking Subsidiary, any 
event which is grounds for the required submission of a capital restoration 
plan under 12 U.S.C. [SECTION]1831(o)(e)(2) and any rules and regulations
issued thereunder, as amended, supplemented or otherwise modified from time to 
time, or for seeking the appointment of a receiver or conservator under 12 
U.S.C. 1821(c) and any rules and regulations issued thereunder, as amended, 
supplemented or otherwise modified from time to time; or any conservator or 
receiver shall be appointed for any Banking Subsidiary under any such 
provisions or any other state or federal law. 
 
      7.14.  Any Change in Control shall occur. 
 
                                ARTICLE VIII 
 
               ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
               ----------------------------------------------
 
      8.1.   Acceleration.  If any Default described in Section 7.6 or 7.7 
occurs with respect to the Borrower, the obligations of the Lenders to make 
Loans hereunder shall automatically terminate and the Obligations shall 
immediately become due and payable without any election or action on the 
part of the Agent or any Lender.  If any other Default occurs, the Required 
Lenders may terminate or suspend the obligations of the Lenders to make 
Loans hereunder, or declare the Obligations to be due and payable, or both, 
whereupon the Obligations shall become immediately due and payable, without 
presentment, demand, protest or notice of any kind, all of which the 
Borrower hereby expressly waives. 
 
      If, after acceleration of the maturity of the Obligations or 
termination of the obligations of the Lenders to make Loans hereunder as a 
result of any Default (other than any Default as described in Section 7.6 or 
7.7 with respect to the Borrower) and before any judgment or decree for the 
payment of the Obligations due shall have been obtained or entered, the 
Required Lenders (in their sole discretion) shall so direct, the Agent 
shall, by notice to the Borrower, rescind and annul such acceleration and/or 
termination. 
 
      8.2.   Amendments.  Subject to the provisions of this Article VIII, 
the Required Lenders (or the Agent with the consent in writing of the 
Required Lenders) and the Borrower may enter into agreements supplemental 
hereto for the purpose of adding or modifying any provisions to the Loan 
Documents or changing in any manner the rights of the Lenders or the 
Borrower hereunder or waiving any Default hereunder; provided, however, that 
no such supplemental agreement shall, without the consent of each Lender: 
 
      (i)    Extend the maturity of any Loan or Note or forgive all or any 
             portion of the principal amount thereof, or reduce the rate or
             extend the time of payment of interest or fees thereon. 
 
      (ii)   Reduce the percentage specified in the definition of Required 
             Lenders. 
 
      (iii)  Extend the Termination Date, or reduce the amount or extend the 
             payment date for, the mandatory payments required under Section
             2.2, or permit the Borrower to assign its rights under this
             Agreement. 
 
      (iv)   Amend this Section 8.2. 
 
No amendment of any provision of this Agreement relating to the Agent shall 
be effective without the written consent of the Agent.  The Agent may waive 
payment of the fee required under Section 12.3.2 without obtaining the 
consent of any other party to this Agreement. 
 
      8.3.   Preservation of Rights.  No delay or omission of the Lenders or 
the Agent to exercise any right under the Loan Documents shall impair such 
right or be construed to be a waiver of any Default or an acquiescence 
therein, and the making of a Loan notwithstanding the existence of a Default 
or the inability of the Borrower to satisfy the conditions precedent to such 
Loan shall not constitute any waiver or acquiescence.  Any single or partial 
exercise of any such right shall not preclude other or further exercise 
thereof or the exercise of any other right, and no waiver, amendment or 
other variation of the terms, conditions or provisions of the Loan Documents 
whatsoever shall be valid unless in writing signed by the Lenders required 
pursuant to Section 8.2, and then only to the extent in such writing 
specifically set forth.  All remedies contained in the Loan Documents or by 
law afforded shall be cumulative and all shall be available to the Agent and 
the Lenders until the Obligations have been paid in full. 
 
                                 ARTICLE IX 
 
                             GENERAL PROVISIONS
                             ------------------
 
      9.1.   Survival of Representations.  All representations and 
warranties of the Borrower contained in this Agreement shall survive 
delivery of the Notes and the making of the Loans herein contemplated. 
 
      9.2.   Governmental Regulation.  Anything contained in this Agreement 
to the contrary notwithstanding, no Lender shall be obligated to extend 
credit to the Borrower in violation of any limitation or prohibition 
provided by any applicable statute or regulation. 
 
      9.3.   Taxes.  Any taxes (excluding federal income taxes on the 
overall net income of any Lender) or other similar assessments or charges 
made by any governmental or revenue authority in respect of the Loan 
Documents shall be paid by the Borrower, together with interest and 
penalties, if any. 
 
      9.4.   Headings; References to Statutes.  Section headings in the Loan 
Documents are for convenience of reference only, and shall not govern the 
interpretation of any of the provisions of the Loan Documents.  Any 
references to specific statutes herein shall be deemed to refer to such 
statute and any rules and regulations issued thereunder or in connection 
therewith, as they may be amended, supplemented or otherwise modified from 
time to time. 
 
      9.5.   Entire Agreement.  The Loan Documents embody the entire 
agreement and understanding among the Borrower, the Agent and the Lenders 
and supersede all prior agreements and understandings among the Borrower, 
the Agent and the Lenders relating to the subject matter thereof. 
 
      9.6.   Several Obligations; Benefits of this Agreement.  The 
respective obligations of the Lenders hereunder are several and not joint 
and no Lender shall be the partner or agent of any other (except to the 
extent to which the Agent is authorized to act as such).  The failure of any 
Lender to perform any of its obligations hereunder shall not relieve any 
other Lender from any of its obligations hereunder.  This Agreement shall 
not be construed so as to confer any right or benefit upon any Person other 
than the parties to this Agreement and their respective successors and 
assigns. 
 
      9.7.   Expenses; Indemnification.  The Borrower shall reimburse the 
Agent for any costs, internal charges and out-of-pocket expenses (including 
attorneys' fees and time charges of attorneys for the Agent, which attorneys 
may be employees of the Agent) paid or incurred by the Agent in connection 
with the preparation, negotiation, execution, delivery, review, amendment, 
modification, and administration of the Loan Documents.  The Borrower also 
agrees to reimburse the Agent and the Lenders for any costs, internal 
charges and out-of-pocket expenses (including attorneys' fees and time 
charges of attorneys for the Agent and the Lenders, which attorneys may be 
employees of the Agent or the Lenders) paid or incurred by the Agent or any 
Lender in connection with the collection and enforcement of the Loan 
Documents.  The Borrower further agrees to indemnify the Agent and each 
Lender, its directors, officers and employees against all losses, claims, 
damages, penalties, judgments, liabilities and expenses (including, without 
limitation, all expenses of litigation or preparation therefor whether or 
not the Agent or any Lender is a party thereto) which any of them may pay or 
incur arising out of or relating to this Agreement, the other Loan 
Documents, the transactions contemplated hereby or the direct or indirect 
application or proposed application of the proceeds of any Loan hereunder.  
The obligations of the Borrower under this Section shall survive the 
termination of this Agreement. 
 
      9.8.   Numbers of Documents.  All statements, notices, closing 
documents, and requests hereunder shall be furnished to the Agent with 
sufficient counterparts so that the Agent may furnish one to each of the 
Lenders. 
 
      9.9.   Accounting.  Except as provided to the contrary herein, all 
accounting terms used herein shall be interpreted and all accounting 
determinations hereunder shall be made in accordance with Agreement 
Accounting Principles; provided, however, that compliance with Sections 
6.18, 6.19 and 6.20 shall be interpreted and all determinations thereunder 
shall be made in accordance with regulatory accounting principles as in 
effect from time to time, applied in a manner consistent with that used in 
preparing the financial statements and reports referred to in Section 
6.1(iv) for the fiscal quarter ended September 30, 1996. 
 
      9.10.  Severability of Provisions.  Any provision in any Loan Document 
that is held to be inoperative, unenforceable, or invalid in any 
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, 
or invalid without affecting the remaining provisions in that jurisdiction 
or the operation, enforceability, or validity of that provision in any other 
jurisdiction, and to this end the provisions of all Loan Documents are 
declared to be severable. 
 
      9.11.  Nonliability of Lenders.  The relationship between the Borrower 
and the Lenders and the Agent shall be solely that of borrower and lender.  
Neither the Agent nor any Lender shall have any fiduciary responsibilities 
to the Borrower.  Neither the Agent nor any Lender undertakes any 
responsibility to the Borrower to review or inform the Borrower of any 
matter in connection with any phase of the Borrower's business or 
operations. 
 
      9.12.  CHOICE OF LAW.  THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING 
A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE 
WITH THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF 
ILLINOIS, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS. 
 
      9.13.  CONSENT TO JURISDICTION.  THE BORROWER HEREBY IRREVOCABLY 
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR 
ILLINOIS STATE COURT SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING 
OUT OF OR RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY 
AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD 
AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY 
NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING 
BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.  
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY LENDER TO BRING 
PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.  
ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT OR ANY LENDER OR 
ANY AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, 
ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN 
DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS. 
 
      9.14.  WAIVER OF JURY TRIAL.  THE BORROWER, THE AGENT AND EACH LENDER 
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR 
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN 
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR 
THE RELATIONSHIP ESTABLISHED THEREUNDER. 
 
      9.15.  Confidentiality.  Each Lender acknowledges that it will obtain 
certain confidential and proprietary information from the Borrower in the 
course of performance or enforcement of the obligations hereunder.  Each 
Lender agrees to hold any such confidential information which it may receive 
from the Borrower pursuant to this Agreement in confidence, except for 
disclosure (i) to other Lenders and their respective Affiliates, (ii) to 
legal counsel, accountants, and other professional advisors to that Lender 
or to a Transferee, (iii) to regulatory officials acting in the course of 
their duty, (iv) to any Person as required by law, regulation, or legal 
process, (v) to any Person in connection with any legal proceeding to which 
that Lender is a party, and (vi) permitted by Section 12.4.            

                                  ARTICLE X
 
                                  THE AGENT
                                  ---------
 
      10.1.  Appointment.  The First National Bank of Chicago is hereby 
appointed Agent hereunder and under each other Loan Document, and each of 
the Lenders irrevocably authorizes the Agent to act as the agent of such 
Lender.  The Agent agrees to act as such upon the express conditions 
contained in this Article X.  The Agent shall not have a fiduciary 
relationship in respect of the Borrower or any Lender by reason of this 
Agreement. 
 
      10.2.  Powers.  The Agent shall have and may exercise such powers 
under the Loan Documents as are specifically delegated to the Agent by the 
terms of each thereof, together with such powers as are reasonably 
incidental thereto.  The Agent shall have no implied duties to the Lenders, 
or any obligation to the Lenders to take any action thereunder except any 
action specifically provided by the Loan Documents to be taken by the Agent. 
 
      10.3.  General Immunity.  Neither the Agent nor any of its directors, 
officers, agents or employees shall be liable to the Borrower, the Lenders 
or any Lender for any action taken or omitted to be taken by it or them 
hereunder or under any other Loan Document or in connection herewith or 
therewith except for its or their own gross negligence or willful 
misconduct. 
 
      10.4.  No Responsibility for Loans, Recitals, etc.  Neither the Agent 
nor any of its 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 any Loan 
Document or any borrowing hereunder; (ii) the performance or observance of 
any of the covenants or agreements of any obligor under any Loan Document, 
including, without limitation, any agreement by an obligor to furnish 
information directly to each Lender; (iii) the satisfaction of any condition 
specified in Article IV, except receipt of items required to be delivered to 
the Agent; (iv) the validity, effectiveness or genuineness of any Loan 
Document or any other instrument or writing furnished in connection 
therewith; or (v) the value, sufficiency, creation, perfection or priority 
of any interest in any collateral security.  The Agent shall have no duty to 
disclose to the Lenders information that is not required to be furnished by 
the Borrower to the Agent at such time, but is voluntarily furnished by the 
Borrower to the Agent (either in its capacity as Agent or in its individual 
capacity). 
 
      10.5.  Action on Instructions of Lenders.  The Agent shall in all 
cases be fully protected in acting, or in refraining from acting, hereunder 
and under any other Loan Document in accordance with written instructions 
signed by the Required Lenders, and such instructions and any action taken 
or failure to act pursuant thereto shall be binding on all of the Lenders 
and on all holders of Notes.  The Agent shall be fully justified in failing 
or refusing to take any action hereunder and under any other Loan Document 
unless it shall first be indemnified to its satisfaction by the Lenders pro 
rata against any and all liability, cost and expense that it may incur by 
reason of taking or continuing to take any such action. 
 
      10.6.  Employment of Agents and Counsel.  The Agent may execute any of 
its duties as Agent hereunder and under any other Loan Document by or 
through employees, agents, and attorneys-in-fact and shall not be answerable 
to the Lenders, except as to money or securities received by it or its 
authorized agents, for the default or misconduct of any such agents or 
attorneys-in-fact selected by it with reasonable care.  The Agent shall be 
entitled to advice of counsel concerning all matters pertaining to the 
agency hereby created and its duties hereunder and under any other Loan 
Document. 
 
      10.7.  Reliance on Documents; Counsel.  The Agent shall be entitled to 
rely upon any Note, notice, consent, certificate, affidavit, letter, 
telegram, statement, paper or document believed by it to be genuine and 
correct and to have been signed or sent by the proper person or persons, 
and, in respect to legal matters, upon the opinion of counsel selected by 
the Agent, which counsel may be employees of the Agent. 
 
      10.8.  Agent's Reimbursement and Indemnification.  The Lenders agree 
to reimburse and indemnify the Agent ratably in proportion to their 
respective Loans outstanding (i) for any amounts not reimbursed by the 
Borrower for which the Agent is entitled to reimbursement by the Borrower 
under the Loan Documents, (ii) for any other expenses incurred by the Agent 
on behalf of the Lenders, in connection with the preparation, execution, 
delivery, administration and enforcement of the Loan Documents and (iii) for 
any liabilities, obligations, losses, damages, penalties, actions, 
judgments, suits, costs, expenses or disbursements of any kind and nature 
whatsoever which may be imposed on, incurred by or asserted against the 
Agent in any way relating to or arising out of the Loan Documents or any 
other document delivered in connection therewith or the transactions 
contemplated thereby, or the enforcement of any of the terms thereof or of 
any such other documents, provided that no Lender shall be liable for any of 
the foregoing to the extent they arise from the gross negligence or willful 
misconduct of the Agent.  The obligations of the Lenders under this Section 
10.8 shall survive payment of the Obligations and termination of this 
Agreement. 
 
      10.9.  Rights as a Lender.  In the event the Agent is a Lender, the 
Agent shall have the same rights and powers hereunder and under any other 
Loan Document as any Lender and may exercise the same as though it were not 
the Agent, and the term "Lender" or "Lenders" shall, at any time when the 
Agent is a Lender, unless the context otherwise indicates, include the Agent 
in its individual capacity.  The Agent may accept deposits from, lend money 
to, and generally engage in any kind of trust, debt, equity or other 
transaction, in addition to those contemplated by this Agreement or any 
other Loan Document, with the Borrower or any of its Subsidiaries in which 
the Borrower or such Subsidiary is not restricted hereby from engaging with 
any other Person.  The Agent, in its individual capacity, is not obligated 
to remain a Lender. 
 
      10.10. Lender Credit Decision.  Each Lender acknowledges that it has, 
independently and without reliance upon the Agent or any other Lender and 
based on the financial statements prepared by the Borrower and such other 
documents and information as it has deemed appropriate, made its own credit 
analysis and decision to enter into this Agreement and the other Loan 
Documents.  Each Lender also acknowledges that it will, independently and 
without reliance upon the Agent or any other Lender 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 action under this 
Agreement and the other Loan Documents. 
 
      10.11. Successor Agent.  The Agent may resign at any time by giving 
written notice thereof to the Lenders and the Borrower, such resignation to 
be effective upon the appointment of a successor Agent or, if no successor 
Agent has been appointed, sixty  days after the retiring Agent gives notice 
of its intention to resign.  Upon any such resignation, the Required Lenders 
shall have the right to appoint, on behalf of the Borrower and the Lenders, 
a successor Agent.  If no successor Agent shall have been so appointed by 
the Required Lenders within thirty days after the resigning Agent's giving 
notice of its intention to resign, then the resigning Agent may appoint, on 
behalf of the Borrower and the Lenders, a successor Agent.  If the Agent has 
resigned and no successor Agent has been appointed, the Lenders may perform 
all the duties of the Agent hereunder and the Borrower shall make all 
payments in respect of the Obligations to the applicable Lender and for all 
other purposes shall deal directly with the Lenders.  No successor Agent 
shall be deemed to be appointed hereunder until such successor Agent has 
accepted the appointment.  Any such successor Agent shall be a commercial 
bank having capital and retained earnings of at least $250,000,000.  Upon 
the acceptance of any appointment as Agent hereunder by a successor Agent, 
such successor Agent shall thereupon succeed to and become vested with all 
the rights, powers, privileges and duties of the resigning  Agent.  Upon the 
effectiveness of the resignation  of the Agent, the resigning Agent shall be 
discharged from its duties and obligations hereunder and under the Loan 
Documents.  After the effectiveness of the resignation of an Agent, the 
provisions of this Article X shall continue in effect for the benefit of 
such Agent in respect of any actions taken or omitted to be taken by it 
while it was acting as the Agent hereunder and under the other Loan 
Documents.  
 
      10.12. Agent's Fees.   The Borrower agrees to pay to the Agent, for 
its own account, the fees agreed to by the Borrower and the Agent pursuant 
to that certain letter agreement dated as of even date herewith. 
 
                                 ARTICLE XI 
 
                          SETOFF; RATABLE PAYMENTS
                          ------------------------
 
      11.1.  Setoff.  In addition to, and without limitation of, any rights 
of the Lenders under applicable law, if the Borrower becomes insolvent, 
however evidenced, or any Default or Unmatured Default occurs, any and all 
deposits (including all account balances, whether provisional or final and 
whether or not collected or available) and any other Indebtedness at any 
time held or owing by any Lender to or for the credit or account of the 
Borrower may be offset and applied toward the payment of the Obligations 
owing to such Lender, whether or not the Obligations, or any part hereof, 
shall then be due. 
 
      11.2.  Ratable Payments.  If any Lender, whether by setoff or 
otherwise, has payment made to it upon its Loans (other than payments 
received pursuant to Sections 3.1, 3.2 or 3.4) in a greater proportion than 
that received by any other Lender, such Lender agrees, promptly upon demand, 
to purchase a portion of the Loans held by the other Lenders so that after 
such purchase each Lender will hold its ratable proportion of Loans.  If any 
Lender, whether in connection with setoff or amounts which might be subject 
to setoff or otherwise, receives collateral or other protection for its 
Obligations or such amounts which may be subject to setoff, such Lender 
agrees, promptly upon demand, to take such action necessary such that all 
Lenders share in the benefits of such collateral ratably in proportion to 
their Loans.  In case any such payment is disturbed by legal process, or 
otherwise, appropriate further adjustments shall be made. 
 
                                 ARTICLE XII 
 
              BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
              -------------------------------------------------
 
      12.1.  Successors and Assigns.  The terms and provisions of the Loan 
Documents shall be binding upon and inure to the benefit of the Borrower and 
the Lenders and their respective successors and assigns, except that (i) the 
Borrower shall not have the right to assign its rights or obligations under 
the Loan Documents and (ii) any assignment by any Lender must be made in 
compliance with Section 12.3.  Notwithstanding clause (ii) of this Section, 
any Lender may at any time, without the consent of the Borrower or the 
Agent, assign all or any portion of its rights under this Agreement and its 
Notes to a Federal Reserve Bank; provided, however, that no such assignment 
shall release the transferor Lender from its obligations hereunder.  The 
Agent may treat the payee of any Note as the owner thereof for all purposes 
hereof unless and until such payee complies with Section 12.3 in the case of 
an assignment thereof or, in the case of any other transfer, a written 
notice of the transfer is filed with the Agent.  Any assignee or transferee 
of a Note agrees by acceptance thereof to be bound by all the terms and 
provisions of the Loan Documents.  Any request, authority or consent of any 
Person, who at the time of making such request or giving such authority or 
consent is the holder of any Note, shall be conclusive and binding on any 
subsequent holder, transferee or assignee of such Note or of any Note or 
Notes issued in exchange therefor. 
 
      12.2.  Participations. 
 
            12.2.1.   Permitted Participants; Effect.  Any Lender may, in the
      ordinary course of its business and in accordance with applicable law, at
      any time sell to one or more banks or other entities ("Participants") 
      participating interests in any Loan owing to such Lender, any Note held
      by such Lender, or any other interest of such Lender under the Loan
      Documents. The consent of the Borrower and the Agent, which consent in
      each case shall not be unreasonably withheld, shall be required prior to
      a participation becoming effective with respect to a Participant which
      is not a Lender or an Affiliate thereof; provided, however, that if a
      Default has occurred and is continuing, the consent of the Borrower shall
      not be required. In the event of any such sale by a Lender of
      participating interests to a Participant, such Lender's obligations
      under the Loan Documents shall remain unchanged, such Lender shall remain
      solely responsible to the other parties hereto for the performance of
      such obligations, such Lender shall remain the holder of any such Note
      for all purposes under the Loan Documents, all amounts payable by the
      Borrower under this Agreement shall be determined as if such Lender
      had not sold such participating interests, and the Borrower and the Agent
      shall continue to deal solely and directly with such Lender in connection
      with such Lender's rights and obligations under the Loan Documents. 
 
            12.2.2.   Voting Rights.  Each Lender shall retain the sole right
      to approve, without the consent of any Participant, any amendment,
      modification or waiver of any provision of the Loan Documents other
      than any amendment, modification or waiver with respect to any Loan in
      which such Participant has an interest which forgives principal, interest
      or fees or reduces the interest rate or fees payable with respect to any
      such Loan, postpones any date fixed for any regularly-scheduled payment
      of principal of, or interest or fees on, any such Loan, releases any
      guarantor of any such Loan or releases any substantial portion of
      collateral, if any, securing any such Loan.  
 
            12.2.3.   Benefit of Setoff.  The Borrower agrees that each 
      Participant shall be deemed to have the right of setoff provided in
      Section 11.1 in respect of its participating interest in amounts owing
      under the Loan Documents to the same extent as if the amount of its
      participating interest were owing directly to it as a Lender under the
      Loan Documents, provided that each Lender shall retain the right of
      setoff provided in Section 11.1 with respect to the amount of
      participating interests sold to each Participant.  The Lenders agree to
      share with each Participant, and each Participant, by exercising the
      right of setoff provided in Section 11.1, agrees to share with each
      Lender, any amount received pursuant to the exercise of its right of
      setoff, such amounts to be shared in accordance with Section 11.2 as if
      each Participant were a Lender. 
 
      12.3.  Assignments. 
 
            12.3.1.   Permitted Assignments.  Any Lender may, in the ordinary
      course of its business and in accordance with applicable law, at any time
      assign to one or more banks or other entities ("Purchasers") all or any
      part of its rights and obligations under the Loan Documents.  Such
      assignment shall be substantially in the form of Exhibit "D" hereto or in
      such other form as may be agreed to by the parties thereto.  The consent
      of the Borrower and the Agent, which consent in each case shall not be
      unreasonably withheld, shall be required prior to an assignment becoming
      effective with respect to a Purchaser which is not a Lender or an
      Affiliate thereof; provided, however, that if a Default has occurred
      and is continuing, the consent of the Borrower shall not be required. 
 
            12.3.2.   Effect; Effective Date.  Upon (i) delivery to the Agent
      of a notice of assignment, substantially in the form attached as Exhibit
      "I" to Exhibit "D" hereto (a "Notice of Assignment"), together with any
      consents required by Section 12.3.1, and (ii) payment of a $2,500 fee to
      the Agent for processing such assignment, such assignment shall become
      effective on the effective date specified in such Notice of Assignment.
      The Notice of Assignment shall contain a representation by the Purchaser
      to the effect that none of the consideration used to make the purchase
      of the Loans under the applicable assignment agreement are "plan assets"
      as defined under ERISA and that the rights and interests of the Purchaser
      in and under the Loan Documents will not be "plan assets" under ERISA.
      On and after the effective date of such assignment, such Purchaser shall
      for all purposes be a Lender party to this Agreement and any other Loan
      Document executed by the Lenders and shall have all the rights and
      obligations of a Lender under the Loan Documents, to the same extent as
      if it were an original party hereto, and no further consent or action by
      the Borrower, the Lenders or the Agent shall be required to release the
      transferor Lender with respect to the percentage of the Loans assigned
      to such Purchaser.  Upon the consummation of any assignment to a
      Purchaser pursuant to this Section 12.3.2, the transferor Lender, the
      Agent and the Borrower shall make appropriate arrangements so that
      replacement Notes are issued to such transferor Lender and new Notes or,
      as appropriate, replacement Notes, are issued to such Purchaser. 
 
      12.4.  Dissemination of Information.  The Borrower authorizes each 
Lender to disclose to any Participant or Purchaser or any other Person 
acquiring an interest in the Loan Documents by operation of law (each a 
"Transferee") and any prospective Transferee any and all information in such 
Lender's possession concerning the creditworthiness of the Borrower and its 
Subsidiaries; provided that each Transferee and prospective Transferee 
agrees to be bound by Section 9.15 of this Agreement. 
 
      12.5.  Tax Treatment.  If any interest in any Loan Document is 
transferred to any Transferee which is organized under the laws of any 
jurisdiction other than the United States or any State thereof, the 
transferor Lender shall cause such Transferee, concurrently with the 
effectiveness of such transfer, to comply with the provisions of Section 
2.18. 
 
                                ARTICLE XIII 
 
                                   NOTICES
                                   -------
 
      13.1.  Giving Notice.  Except as otherwise permitted by Section 2.13 
with respect to borrowing notices, all notices and other communications 
provided to any party hereto under this Agreement or any other Loan Document 
shall be in writing or by telex or by facsimile and addressed or delivered 
to such party at its address set forth below its signature hereto or at such 
other address as may be designated by such party in a notice to the other 
parties.  Any notice, if mailed and properly addressed with postage prepaid, 
shall be deemed given when received; any notice, if transmitted by telex or 
facsimile, shall be deemed given when transmitted (answerback confirmed in 
the case of telexes). 
 
      13.2.  Change of Address.  The Borrower, the Agent and any Lender may 
each change the address for service of notice upon it by a notice in writing 
to the other parties hereto. 
 
                                 ARTICLE XIV 
 
                                COUNTERPARTS
                                ------------
 
      This Agreement may be executed in any number of counterparts, all of 
which taken together shall constitute one agreement, and any of the parties 
hereto may execute this Agreement by signing any such counterpart.  This 
Agreement shall be effective when it has been executed by the Borrower, the 
Agent and the Lenders and each party has notified the Agent by telex or 
telephone, that it has taken such action. 
 
      IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have 
executed this Agreement as of the date first above written. 
 
                                     BANKNORTH GROUP, INC. 
 
                                     By: /s/ Thomas J. Pruitt 
                                     Print Name: Thomas J. Pruitt 
                                     Title: Executive Vice President & CFO 
                                               300 Financial Plaza 
                                               P.O. Box 5420 
                                               Burlington, Vermont  05401 
 
                                     Attention: Mr. Thomas J. Pruitt 
                                                Executive Vice President 
                                                and Chief Financial Officer 
 
Commitment
----------
 
$6,825,000                           THE FIRST NATIONAL BANK OF CHICAGO, 
                                      Individually and as Agent 
 
                                     By: /s/ Robert E. O'Connell 
                                     Print Name: Robert E. O'Connell 
                                     Title: Vice President 
                                               One First National Plaza 
                                               Chicago, Illinois  60670 
 
                                     Attention: Mr. Robert E. O'Connell 
                                                Vice President 
                                                U.S. Financial 
                                                Institutions 
 
$6,825,000                           LASALLE NATIONAL BANK 
 
                                     By: /s/ Phillip J. Hagglund 
                                     Print Name: Phillip J. Hagglund 
                                     Title: Vice President 
                                               135 South LaSalle Street 
                                               Chicago, Illinois  60603 
 
                                     Attention: Mr. Phillip J. Hagglund 
                                                Vice President 
                                                Correspondent Banking 
                                                Unit - USA 
 
$13,650,000
===========
 
                                 EXHIBIT "A" 
 
                                    NOTE 
 
$                                                      December 16, 1996 
 -------------------------
 
      BANKNORTH GROUP, INC., a Delaware corporation (the "Borrower"), 
promises to pay to the order of                                    (the 
"Lender") the lesser of the principal sum of                    Dollars or 
the aggregate unpaid principal amount of all Loans made by the Lender to the 
Borrower pursuant to Article II of the Term Loan Agreement (as the same may 
be amended or modified, the "Agreement") hereinafter referred to, in 
immediately available funds at the main office of The First National Bank of 
Chicago in Chicago, Illinois, as Agent, together with interest on the unpaid 
principal amount hereof at the rates and on the dates set forth in the 
Agreement.  The Borrower shall pay the principal of and accrued and unpaid 
interest on the Loans in full on the Termination Date and shall make such 
mandatory payments as are required to be made under the terms of Article II 
of the Agreement. 
 
      The Lender shall, and is hereby authorized to, record on the schedule 
attached hereto, or to otherwise record in accordance with its usual 
practice, the date and amount of each Loan and the date and amount of each 
principal payment hereunder. 
 
      This Note is one of the Notes issued pursuant to, and is entitled to 
the benefits of, the Term Loan Agreement, dated as of December 16, 1996, 
among the Borrower, The First National Bank of Chicago, individually and as 
Agent, and the lenders named therein, including the Lender, to which 
Agreement, as it may be amended from time to time, reference is hereby made 
for a statement of the terms and conditions governing this Note, including 
the terms and conditions under which this Note may be prepaid or its 
maturity date accelerated.  Capitalized terms used herein and not otherwise 
defined herein are used with the meanings attributed to them in the 
Agreement. 
 
 
                                     BANKNORTH GROUP, INC. 
 
 
                                     By:
                                        ---------------------------------- 
                                     Print Name:
                                                --------------------------
                                     Title:
                                           -------------------------------

 
                 SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL 
                                     TO 
                       NOTE OF BANKNORTH GROUP, INC., 
                           DATED DECEMBER 16, l996 
<TABLE>
<CAPTION>

         Principal   Maturity      Principal 
         Amount of   of Interest   Amount      Unpaid 
Date     Loan        Period        Paid        Balance 
------------------------------------------------------
 
<S>      <C>         <C>           <C>         <C>


</TABLE>

 
 
 
                                 EXHIBIT "B" 
                               FORM OF OPINION 
 
                                       , 19
 
To:   The Agent and the Lenders who are parties 
      to the Agreement described below. 
 
Gentlemen/Ladies: 
 
      We are counsel for Banknorth Group, Inc. (the Borrower"), and have 
represented the Borrower in connection with its execution and delivery of a 
Term Loan Agreement among the Borrower, The First National Bank of Chicago, 
individually and as Agent, and the Lenders named therein, providing for 
Advances in an aggregate principal amount not exceeding $13,650,000 at any 
one time outstanding and dated as of December 16, 1996 (the "Agreement").  
All capitalized terms used in this opinion and not otherwise defined shall 
have the meanings attributed to them in the Agreement. 
 
      We have examined the Borrower's articles of incorporation, by-laws, 
resolutions, the Loan Documents and such other matters of fact and law which 
we deem necessary in order to render this opinion.  Based upon the 
foregoing, it is our opinion that: 
 
      l.   The Borrower and each Subsidiary are corporations duly 
incorporated, validly existing and in good standing under the laws of their 
states of incorporation and have all requisite authority to conduct their 
business in each jurisdiction in which their business is conducted, except 
where the failure to obtain such authority would not have a Material Adverse 
Effect. 
 
      2.   The execution and delivery of the Loan Documents by the Borrower 
and the performance by the Borrower of the Obligations have been duly 
authorized by all necessary corporate action and proceedings on the part of 
the Borrower and will not: 
 
      (a)   require any consent of the Borrower's shareholders; 
 
            (b)   violate any law, rule, regulation, order, writ, judgment, 
      injunction, decree or award binding on the Borrower or any of its 
      Subsidiaries or the Borrower's or any Subsidiary's articles of
      incorporation or by-laws or any indenture, instrument or agreement
      binding upon the Borrower or any of its Subsidiaries; or 
 
            (c)   result in, or require, the creation or imposition of any Lien
      pursuant to the provisions of any indenture, instrument or agreement
      binding upon the Borrower or any of its Subsidiaries. 
 
      3.   The Loan Documents have been duly executed and delivered by the 
Borrower and constitute legal, valid and binding obligations of the Borrower 
enforceable in accordance with their terms except to the extent the 
enforcement thereof may be limited by bankruptcy, insolvency or similar laws 
affecting the enforcement of creditors' rights generally and subject also to 
the availability of equitable remedies if equitable remedies are sought. 
 
      4.   There is no litigation or proceeding against the Borrower or any 
of its Subsidiaries which, if adversely determined, could have a Material 
Adverse Effect. 
 
      5.   No approval, authorization, consent, adjudication or order of any 
governmental authority, which has not been obtained by the Borrower or any 
of its Subsidiaries, is required to be obtained by the Borrower or any of 
its Subsidiaries in connection with the execution and delivery of the Loan 
Documents, the borrowings under the Agreement or in connection with the 
payment by the Borrower of the Obligations. 
 
      This opinion may be relied upon by the Agent, the Lenders and their 
participants, assignees and other transferees. 
 
 
                                     Very truly yours, 
 
                                     ----------------------------------
 
                                 EXHIBIT "C" 
 
                           COMPLIANCE CERTIFICATE 
 
To:   The Lenders parties to the 
      Agreement described below. 
 
      This Compliance Certificate is furnished pursuant to that certain Term 
Loan Agreement dated as of December 16, 1996 (as amended, modified, renewed 
or extended from time to time, the "Agreement") among the Borrower, the 
lenders party thereto and The First National Bank of Chicago, as Agent for 
the Lenders.  Unless otherwise defined herein, capitalized terms used in 
this Compliance Certificate have the meanings ascribed thereto in the 
Agreement. 
 
      THE UNDERSIGNED HEREBY CERTIFIES THAT: 
 
      1.  I am the duly elected                       of the Borrower; 
 
      2.  I have reviewed the terms of the Agreement and I have made, or 
have caused to be made under my supervision, a detailed review of the 
transactions and conditions of the Borrower and its Subsidiaries during the 
accounting period covered by the attached financial statements; 
 
      3.  The examinations described in paragraph 2 did not disclose, and I 
have no knowledge of, the existence of any condition or event which 
constitutes a Default or Unmatured Default during or at the end of the 
accounting period covered by the attached financial statements or as of the 
date of this Certificate, except as set forth below; and 
 
      4.  Schedule I attached hereto sets forth financial data and 
computations evidencing the Borrower's compliance with certain covenants of 
the Agreement, all of which data and computations are true, complete and 
correct. 
 
      Described below are the exceptions, if any, to paragraph 3 by listing, 
in detail, the nature of the condition or event, the period during which it 
has existed and the action which the Borrower has taken, is taking, or 
proposes to take with respect to each such condition or event: 
 
 
      ------------------------------------------------------------------
 
      ------------------------------------------------------------------ 

      ------------------------------------------------------------------ 

      ------------------------------------------------------------------ 
 
      The foregoing certifications, together with the computations set forth 
in Schedule I hereto and the financial statements delivered with this 
Certificate in support hereof, are made and delivered this      day of
              , 19   . 
 
                                                    -----------------------

                    SCHEDULE I TO COMPLIANCE CERTIFICATE 
 
                                 SCHEDULE I 
 
                     Compliance as of
                                      -----------------
 
                              ($ in Thousands) 
 
Section 6.10   Dividends: 
 
A.    Dividends Paid 
 
      1.   Dividends, redemptions and/or 
           repurchases of capital stock since 
           9/30/96 as of the last date of 
           calculation                                   $
                                                          -----------------
 
      2.   Dividends, redemptions, and/or 
           repurchases of capital stock during 
           the quarter just ended                        $
                                                          -----------------
 
      3.   Total Dividends Paid (1 + 2)                  $
                                                          ----------------- 
B.    Allowable Dividends 
 
      1.   $7,000                                        $
                                                          ----------------- 
 
      2.   40.00% of Consolidated Net Income 
           (Loss) since 9/30/96 as of the 
           last date of calculation                      $
                                                          -----------------
 
      3.   40.00% of Consolidated Net Income 
           (Loss) for the quarter just ended             $
                                                          -----------------
 
      4.   Total Allowable Dividends 
           (1 + 2 + 3)                                   $
                                                          -----------------

C.   B - A (must be a positive figure)                   $
                                                          ----------------- 
Section 6.11   Indebtedness: 
 
A.    Total Additional Indebtedness not 
      to exceed $20,000 at any one time 
      outstanding                                        $
                                                          -----------------
 
Section 6.15   Investments and Acquisitions: 
 
A.    Investments in Subsidiaries 
 
      1.   Additional Investments in Subsidiaries 
           in an aggregate principal amount not 
           exceeding 12.5% of Tangible Equity  
           Capital at any one time 
           outstanding                                   $
                                                          ----------------- 

Section 6.18   Consolidated Non-Performing 
               Assets to Total Equity Capital 
 
A.    Consolidated Non-Performing Assets 
 
      1.   Loans on nonaccrual status                    $
                                                          -----------------
 
      2.   Loans 90 days or more past 
           due and still accruing                        $
                                                          -----------------
 
      3.   Loans and leases restructured and 
           in compliance with modified terms             $
                                                          -----------------
 
      4.   Other Real Estate Owned                       $
                                                          -----------------
 
      5.   Property acquired pursuant to 
           in substance foreclosures                     $
                                                          ----------------
 
      6.   Total Consolidated Non-Performing 
           Assets (1 + 2 + 3 + 4 + 5)                    $
                                                          ----------------- 
B.    Total Equity Capital                               $
                                                          -----------------
 
C.    Ratio (A6/B)                                                    :1.00
                                                          -----------------

D.    Maximum Permitted                                           0.40:1.00
                                                          -----------------
 
Section 6.19   Funded Debt to Tangible 
               Equity Capital: 
 
A.    Funded Debt                                        $
                                                          -----------------
 
B.    Total Equity Capital                               $
                                                          ----------------- 
C.    Goodwill                                           $
                                                          -----------------
 
D.    Tangible Equity Capital (B-C)                      $
                                                          ----------------- 

E.    Ratio A/D                                                       :1.00
                                                          ----------------- 

D.    Maximum Permitted                                           0.25:1.00
                                                          -----------------
 
Section 6.20   Return on Average Assets: 
 
A.    Annualized Net Income                              $
                                                          -----------------
 
B.    Total Consolidated Average Assets                  $
                                                          ----------------- 

C.    Ratio (A/B)                                                     :1.00
                                                          -----------------
 
D.    Minimum Required                                            0.25:1.00
                                                          -----------------
 
                                 EXHIBIT "D" 
 
                            ASSIGNMENT AGREEMENT 
 
      This Assignment Agreement (this "Assignment Agreement") between  the 
"Assignor") and                    (the "Assignee") is dated as of           
     , 19  .  The parties hereto agree as follows: 
 
      1.   PRELIMINARY STATEMENT.  The Assignor is a party to a Credit 
Agreement (which, as it may be amended, modified, renewed or extended from 
time to time is herein called the "Credit Agreement") described in Item 1 of 
Schedule 1 attached hereto ("Schedule 1").  Capitalized terms used herein 
and not otherwise defined herein shall have the meanings attributed to them 
in the Credit Agreement. 
 
      2.   ASSIGNMENT AND ASSUMPTION.  The Assignor hereby sells and assigns 
to the Assignee, and the Assignee hereby purchases and assumes from the 
Assignor, an interest in and to the Assignor's rights and obligations under 
the Credit Agreement such that after giving effect to such assignment the 
Assignee shall have purchased pursuant to this Assignment Agreement the 
percentage interest specified in Item 3 of Schedule 1 of all outstanding 
rights and obligations under the Credit Agreement relating to the facilities 
listed in Item 3 of Schedule 1 and the other Loan Documents.  The aggregate 
Commitment (or Loans, if the applicable Commitment has been terminated) 
purchased by the Assignee hereunder is set forth in Item 4 of Schedule 1. 
 
 
      3.   EFFECTIVE DATE.  The effective date of this Assignment Agreement 
(the "Effective Date") shall be the later of the date specified in Item 5 of 
Schedule 1 or two Business Days (or such shorter period agreed to by the 
Agent) after a Notice of Assignment substantially in the form of Exhibit "I" 
attached hereto has been delivered to the Agent.  Such Notice of Assignment 
must include any consents required to be delivered to the Agent by Section 
12.3.1 of the Credit Agreement.  In no event will the Effective Date occur 
if the payments required to be made by the Assignee to the Assignor on the 
Effective Date under Sections 4 and 5 hereof are not made on the proposed 
Effective Date.  The Assignor will notify the Assignee of the proposed 
Effective Date no later than the Business Day prior to the proposed 
Effective Date.  As of the Effective Date, (i) the Assignee shall have the 
rights and obligations of a Lender under the Loan Documents with respect to 
the rights and obligations assigned to the Assignee hereunder and (ii) the 
Assignor shall relinquish its rights and be released from its corresponding 
obligations under the Loan Documents with respect to the rights and 
obligations assigned to the Assignee hereunder. 
 
      4.   PAYMENTS OBLIGATIONS.  On and after the Effective Date, the 
Assignee shall be entitled to receive from the Agent all payments of 
principal, interest and fees with respect to the interest assigned hereby.  
The Assignee shall advance funds directly to the Agent with respect to all 
Loans and reimbursement payments made on or after the Effective Date with 
respect to the interest assigned hereby.  [In consideration for the sale and 
assignment of Loans hereunder, (i) the Assignee shall pay the Assignor, on 
the Effective Date, an amount equal to the principal amount of the portion 
of all Floating Rate Loans assigned to the Assignee hereunder and (ii) with 
respect to each Eurodollar Loan made by the Assignor and assigned to the 
Assignee hereunder which is outstanding on the Effective Date, (a) on the 
last day of the Eurodollar Interest Period therefor or (b) on such earlier 
date agreed to by the Assignor and the Assignee or (c) on the date on which 
any such Eurodollar Loan either becomes due (by acceleration or otherwise) 
or is prepaid (the date as described in the foregoing clauses (a), (b) or 
(c) being hereinafter referred to as the "Payment Date"), the Assignee shall 
pay the Assignor an amount equal to the principal amount of the portion of 
such Eurodollar Loan assigned to the Assignee which is outstanding on the 
Payment Date.  If the Assignor and the Assignee agree that the Payment Date 
for such Eurodollar Loan shall be the Effective Date, they shall agree to 
the interest rate applicable to the portion of such Loan assigned hereunder 
for the period from the Effective Date to the end of the existing Eurodollar 
Interest Period applicable to such Eurodollar Loan (the "Agreed Interest 
Rate") and any interest received by the Assignee in excess of the Agreed 
Interest Rate shall be remitted to the Assignor.  In the event interest for 
the period from the Effective Date to but not including the Payment Date is 
not paid by the Borrower with respect to any Eurodollar Loan sold by the 
Assignor to the Assignee hereunder, the Assignee shall pay to the Assignor 
interest for such period on the portion of such Eurodollar Loan sold by the 
Assignor to the Assignee hereunder at the applicable rate provided by the 
Credit Agreement.  In the event a prepayment of any Eurodollar Loan which is 
existing on the Payment Date and assigned by the Assignor to the Assignee 
hereunder occurs after the Payment Date but before the end of the Eurodollar 
Interest Period applicable to such Eurodollar Loan, the Assignee shall remit 
to the Assignor the excess of the prepayment penalty paid with respect to 
the portion of such Eurodollar Loan assigned to the Assignee hereunder over 
the amount which would have been paid if such prepayment penalty was 
calculated based on the Agreed Interest Rate.  The Assignee will also 
promptly remit to the Assignor (i) any principal payments received from the 
Agent with respect to Eurodollar Loans prior to the Payment Date and (ii) 
any amounts of interest on Loans and fees received from the Agent which 
relate to the portion of the Loans assigned to the Assignee hereunder for 
periods prior to the Effective Date, in the case of Floating Rate Loans or 
fees, or the Payment Date, in the case of Eurodollar Loans, and not 
previously paid by the Assignee to the Assignor.]*  In the event that either 
party hereto receives any payment to which the other party hereto is 
entitled under this Assignment Agreement, then the party receiving such 
amount shall promptly remit it to the other party hereto. 
 
      5.   FEES PAYABLE BY THE ASSIGNEE.  The Assignee shall pay to the 
Assignor a fee on each day on which a payment of interest or fees is made 
under the Credit Agreement with respect to the amounts assigned to the 
Assignee hereunder (other than a payment of interest or fees for the period 
prior to the Effective Date or, in the case of Eurodollar Loans, the Payment 
Date, which the Assignee is obligated to deliver to the Assignor pursuant to 
Section 4 hereof).  The amount of such fee shall be the difference between 
(i) the interest or fee, as applicable, paid with respect to the amounts 
assigned to the Assignee hereunder and (ii) the interest or fee, as 
applicable, which would have been paid with respect to the amounts assigned 
to the Assignee hereunder if each interest rate was     of 1%  less than the 
interest rate paid by the Borrower or if the commitment fee was     of 1% 
less than the commitment fee paid by the Borrower, as applicable.  In 
addition, the Assignee agrees to pay    % of the recordation fee required to 
be paid to the Agent in connection with this Assignment Agreement. 
 
      6.   REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S 
LIABILITY.  The Assignor represents and warrants that it is the legal and 
beneficial owner of the interest being assigned by it hereunder and that 
such interest is free and clear of any adverse claim created by the 
Assignor.  It is understood and agreed that the assignment and assumption 
hereunder are made without recourse to the Assignor and that the Assignor 
makes no other representation or warranty of any kind to the Assignee.  
Neither the Assignor nor any of its officers, directors, employees, agents 
or attorneys shall be responsible for (i) the due execution, legality, 
validity, enforceability, genuineness, sufficiency or collectability of any 
Loan Document, including without limitation, documents granting the Assignor 
and the other Lenders a security interest in assets of the Borrower or any 
guarantor, (ii) any representation, warranty or statement made in or in 
connection with any of the Loan Documents, (iii) the financial condition or 
creditworthiness of the Borrower or any guarantor, (iv) the performance of 
or compliance with any of the terms or provisions of any of the Loan 
Documents, (v) inspecting any of the Property, books or records of the 
Borrower, (vi) the validity, enforceability, perfection, priority, 
condition, value or sufficiency of any collateral securing or purporting to 
secure the Loans or (vii) any mistake, error of judgment, or action taken or 
omitted to be taken in connection with the Loans or the Loan Documents. 
 
 
      7.   REPRESENTATIONS OF THE ASSIGNEE.  The Assignee (i) confirms that 
it has received a copy of the Credit Agreement, together with copies of the 
financial statements requested by the Assignee and such other documents and 
information as it has deemed appropriate to make its own credit analysis and 
decision to enter into this Assignment Agreement, (ii) agrees that it will, 
independently and without reliance upon the Agent, the Assignor or any other 
Lender and based on such documents and information at it shall deem 
appropriate at the time, continue to make its own credit decisions in taking 
or not taking action under the Loan Documents, (iii) appoints and authorizes 
the Agent to take such action as agent on its behalf and to exercise such 
powers under the Loan Documents as are delegated to the Agent by the terms 
thereof, together with such powers as are reasonably incidental thereto, 
(iv) agrees that it will perform in accordance with their terms all of the 
obligations which by the terms of the Loan Documents are required to be 
performed by it as a Lender, (v) agrees that its payment instructions and 
notice instructions are as set forth in the attachment to Schedule 1, (vi) 
confirms that none of the funds, monies, assets or other consideration being 
used to make the purchase and assumption hereunder are "plan assets" as 
defined under ERISA and that its rights, benefits and interests in and under 
the Loan Documents will not be "plan assets" under ERISA, [(vii) confirms 
that it is an Eligible Assignee,]* [and (viii) attaches the forms prescribed 
by the Internal Revenue Service of the United States certifying that the 
Assignee is entitled to receive payments under the Loan Documents without 
deduction or withholding of any United States federal income taxes].** 
 
      8.   INDEMNITY.  The Assignee agrees to indemnify and hold the 
Assignor harmless against any and all losses, costs and expenses (including, 
without limitation, reasonable attorneys' fees) and liabilities incurred by 
the Assignor in connection with or arising in any manner from the Assignee's 
non-performance of the obligations assumed under this Assignment Agreement. 
 
      9.   SUBSEQUENT ASSIGNMENTS.  After the Effective Date, the Assignee 
shall have the right pursuant to Section 12.3.1 of the Credit Agreement to 
assign the rights which are assigned to the Assignee hereunder to any entity 
or person, provided that (i) any such subsequent assignment does not violate 
any of the terms and conditions of the Loan Documents or any law, rule, 
regulation, order, writ, judgment, injunction or decree and that any consent 
required under the terms of the Loan Documents has been obtained and (ii) 
unless the prior written consent of the Assignor is obtained, the Assignee 
is not thereby released from its obligations to the Assignor hereunder, if 
any remain unsatisfied, including, without limitation, its obligations under 
Sections 4, 5 and 8 hereof. 
 
      10.   REDUCTIONS OF AGGREGATE COMMITMENT.  If any reduction in the 
Aggregate Commitment occurs between the date of this Assignment Agreement 
and the Effective Date, the percentage interest specified in Item 3 of 
Schedule 1 shall remain the same, but the dollar amount purchased shall be 
recalculated based on the reduced Aggregate Commitment. 
 
      11.  ENTIRE AGREEMENT.  This Assignment Agreement and the attached 
Notice of Assignment embody the entire agreement and understanding between 
the parties hereto and supersede all prior agreements and understandings 
between the parties hereto relating to the subject matter hereof. 
 
 
      12.  GOVERNING LAW.  This Assignment Agreement shall be governed by 
the internal law, and not the law of conflicts, of the State of Illinois. 
 
      13.  NOTICES.  Notices shall be given under this Assignment Agreement 
in the manner set forth in the Credit Agreement.  For the purpose hereof, 
the addresses of the parties hereto (until notice of a change is delivered) 
shall be the address set forth in the attachment to Schedule 1. 
 
      IN WITNESS WHEREOF, the parties hereto have executed this Assignment 
Agreement by their duly authorized officers as of the date first above 
written. 
 
                                     [NAME OF ASSIGNOR] 
 
                                     By:
                                           --------------------------
                                     Title:
                                           --------------------------

                                           --------------------------

                                           --------------------------
 
                                     [NAME OF ASSIGNEE] 
 
                                     By:
                                           --------------------------
                                     Title:
                                           --------------------------

                                           --------------------------

                                           --------------------------
 
                                 SCHEDULE 1 
                           to Assignment Agreement 
 
1.   Description and Date of Credit Agreement:  Term Loan Agreement, dated 
as of December 16, 1996, among Banknorth Group, Inc., the Lenders 
named therein and The First National Bank of Chicago, as Agent. 
 
2.   Date of Assignment Agreement:_______________, 19__
 
3.   Amounts (As of Date of Item 2 above): 
 
<TABLE>
<CAPTION>
                                         Facility   Facility   Facility   Facility 
                                            1*         2*         *3         *4 
                                         -----------------------------------------
     <S>                                 <C>        <C>        <C>        <C>

     a.   Total of Commitments 
          (Loans)** under 
          Credit Agreement               $          $          $          $
                                          ------     ------     ------     ------
 
     b.   Assignee's Percentage 
          of each Facility purchased 
          under the Assignment 
          Agreement***                         %          %          %          % 
                                         ------     ------     ------     ------
 
     c.   Amount of Assigned Share in 
          each Facility purchased under 
          the Assignment Agreement       $          $          $          $
                                          ------     ------     ------     ------
 
4.   Assignee's Aggregate (Loan 
     Amount)**  Commitment Amount 
     Purchased Hereunder:                           $
                                                     ------
 
5.   Proposed Effective Date:
                                                     ------

     Accepted and Agreed: 
 
     [NAME OF ASSIGNOR]              [NAME OF ASSIGNEE] 
     By:                             By:
        ---------------------           --------------------------
     Title:                          Title:
           ------------------              -----------------------
 
<F1> *    Insert specific facility names per Credit Agreement 
<F2> **   If a Commitment has been terminated, insert outstanding Loans in place
          of Commitment 
<F3> ***  Percentage taken to 10 decimal places 
</TABLE>

 
              Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT 
 
      Attach Assignor's Administrative Information Sheet, which must
include notice address for the Assignor and the Assignee 
 
                                 EXHIBIT "I" 
                           to Assignment Agreement 
 
                                   NOTICE 
                                OF ASSIGNMENT
                                -------------
 
                                              _________________, 19__
 
To:      BANKNORTH GROUP, INC.* 
 
         ----------------------

         ----------------------
 
         [NAME OF AGENT] 
         
         ----------------------

         ----------------------         
 
From:    [NAME OF ASSIGNOR] (the "Assignor") 
 
         [NAME OF ASSIGNEE] (the "Assignee") 
 
      1.   We refer to that Credit Agreement (the "Credit Agreement") 
described in Item 1 of Schedule 1 attached hereto ("Schedule 1").  
Capitalized terms used herein and not otherwise defined herein shall have 
the meanings attributed to them in the Credit Agreement. 
 
      2.   This Notice of Assignment (this "Notice") is given and delivered 
to ****[the Borrower and]**** the Agent pursuant to Section 12.3.2 of the 
Credit Agreement. 
 
      3.   The Assignor and the Assignee have entered into an Assignment 
Agreement, dated as of            , 19   (the "Assignment"), pursuant to 
which, among other things, the Assignor has sold, assigned, delegated and 
transferred to the Assignee, and the Assignee has purchased, accepted and 
assumed from the Assignor the percentage interest specified in Item 3 of 
Schedule 1 of all outstandings, rights and obligations under the Credit 
Agreement relating to the facilities listed in Item 3 of Schedule 1.  The 
Effective Date of the Assignment shall be the later of the date specified in 
Item 5 of Schedule 1 or two Business Days (or such shorter period as agreed 
to by the Agent) after this Notice of Assignment and any consents and fees 
required by Sections 12.3.1 and 12.3.2 of the Credit Agreement have been 
delivered to the Agent, provided that the Effective Date shall not occur if 
any condition precedent agreed to by the Assignor and the Assignee has not 
been satisfied. 
 
*   To be included only if consent must be obtained from the Borrower 
    pursuant to Section 12.3.1 of the Credit Agreement. 
 
      4.   The Assignor and the Assignee hereby give to the Borrower and the 
Agent notice of the assignment and delegation referred to herein.  The 
Assignor will confer with the Agent before the date specified in Item 5 of 
Schedule 1 to determine if the Assignment Agreement will become effective on 
such date pursuant to Section 3 hereof, and will confer with the Agent to 
determine the Effective Date pursuant to Section 3 hereof if it occurs 
thereafter.  The Assignor shall notify the Agent if the Assignment Agreement 
does not become effective on any proposed Effective Date as a result of the 
failure to satisfy the conditions precedent agreed to by the Assignor and 
the Assignee.   At the request of the Agent, the Assignor will give the 
Agent written confirmation of the satisfaction of the conditions precedent. 
 
      5.   The Assignor or the Assignee shall pay to the Agent on or before 
the Effective Date the processing fee of $2,500 required by Section 12.3.2 
of the Credit Agreement. 
 
      6.   If Notes are outstanding on the Effective Date, the Assignor and 
the Assignee request and direct that the Agent prepare and cause the 
Borrower to execute and deliver new Notes or, as appropriate, replacements 
notes, to the Assignor and the Assignee.  The Assignor and, if applicable, 
the Assignee each agree to deliver to the Agent the original Note received 
by it from the Borrower upon its receipt of a new Note in the appropriate 
amount. 
 
      7.   The Assignee advises the Agent that notice and payment 
instructions are set forth in the attachment to Schedule 1. 
 
      8.   The Assignee hereby represents and warrants that none of the 
funds, monies, assets or other consideration being used to make the purchase 
pursuant to the Assignment are "plan assets" as defined under ERISA and that 
its rights, benefits, and interests in and under the Loan Documents will not 
be "plan assets" under ERISA. 
 
      9.   The Assignee authorizes the Agent to act as its agent under the 
Loan Documents in accordance with the terms thereof.  The Assignee 
acknowledges that the Agent has no duty to supply information with respect 
to the Borrower or the Loan Documents to the Assignee until the Assignee 
becomes a party to the Credit Agreement.* 
 
*   May be eliminated if Assignee is a party to the Credit Agreement prior 
    to the Effective Date. 
 
NAME OF ASSIGNOR                     NAME OF ASSIGNEE 
By:                                  By:     
       -------------------------            -----------------------
Title:                               Title:
       -------------------------            -----------------------
 
ACKNOWLEDGED [AND CONSENTED TO]      ACKNOWLEDGED [AND CONSENTED TO] 
BY [NAME OF AGENT]                   BY [NAME OF BORROWER] 
 
By:                                  By: 
       -------------------------            -----------------------
Title:                               Title: 
       -------------------------            -----------------------
 
               [Attach photocopy of Schedule 1 to Assignment] 
 
                                 EXHIBIT "E" 
               LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTIONS 
 
To:   The First National Bank of Chicago, as Agent (the 
      "Agent") under the Agreement described below. 
 
Re:   Term Loan Agreement, dated as of December 16, 1996 (as the same may be 
amended or modified from time to time, the "Credit Agreement"), among 
Banknorth Group, Inc. (the "Borrower"), the Agent, and the Lenders 
named therein. 
 
      Capitalized terms used and not otherwise defined herein shall have the 
meanings assigned thereto in the Credit Agreement. 
 
      The Agent is specifically authorized and directed to act upon the 
following standing money transfer instructions with respect to the proceeds 
of Advances or other extensions of credit from time to time until receipt by 
the Agent of a specific written revocation of such instructions by the 
Borrower; provided, however, that the Agent may otherwise transfer funds as 
hereafter directed in writing by the Borrower in accordance with Section 
13.1 of the Credit Agreement or based on any telephonic notice made in 
accordance with Section 2.13 of the Credit Agreement. 
 
Facility Identification Number(s)
                                  -----------------------------------
 
Customer/Account Name 
                      -----------------------------------------------
 
Transfer Funds To 
                  ---------------------------------------------------

                  ---------------------------------------------------
 
                  ---------------------------------------------------
 
For Account No.   
                  ---------------------------------------------------
 
Reference/Attention To 
                       ----------------------------------------------
 
Authorized Officer 
(Customer Representative)            Date  
                                          ---------------------------
 
-------------------------------      --------------------------------
(Please Print)                       Signature 
 
Bank Officer Name                    Date 
                                          ---------------------------
 
-------------------------------      --------------------------------
(Please Print)                       Signature 
 
                      (Deliver Completed Form to Credit 
                   Support Staff For Immediate Processing) 
 
                                SCHEDULE "1" 
 
                    LITIGATION AND CONTINGENT OBLIGATIONS 
                              (See Section 5.7) 
 
Im May 1996 a $2.6 million suit was filed against the Company in Windham 
County Superior Court, Vermont entitled Klein vs Banknorth Group, Inc. 
alleging sexual discrimination, sexual harassment, intentional infliction of 
emotional distress and tort. The Company has denied all of the plaintiff's 
allegations and believes that it has valid defenses to the plaintiff's 
claims. At this time, discovery in the case is not yet completed. The 
Company intends to defend itself vigorously against all charges. At this 
time, no determination can be made as to the outcome of this litigation.

In addition to the above matter, the Company is a party to other legal 
proceedings and claims which have arisen in the ordinary course of business. 
Management does not believe the outcome of these other legal matters will 
have a material effect on the Company's results of operations, cash flows or 
financial position.

                                SCHEDULE "2" 
 
                     SUBSIDIARIES AND OTHER INVESTMENTS 
                         (See Sections 5.8 and 6.15) 
<TABLE>
<CAPTION>
 
                                                     Amount of    Percent     Jurisdiction of 
    Investment In                    Owned By        Investment   Ownership   Organization
---------------------------------------------------------------------------------------------

<S>                                  <C>            <C>          <C>         <C>
BALANCE AS OF SEPTEMBER 30, 1996:

BANKNORTH GROUP, INC. SUBSIDIARIES:(1)

First Massachussetts Bank, N.A.      Banknorth	     $73,359,661  100%        Massachusetts
Worcester, MA

The Howard Bank, N.A.                Banknorth	      46,111,861  100%        Vermont
Burlington, VT

First Vermont Bank & Trust Co.       Banknorth        44,689,456  100%        Vermont
Brattleboro, VT

Franklin Lamoille Bank & Trust Co.   Banknorth        18,046,917  100%        Vermont
St. Albans, VT							  

North American Bank Corporation      Banknorth        12,912,620  100%        New Hampshire
Farmington, NH

Farmington National Bank             North American   12,912,620  100%        New Hampshire
Farmington, NH                       Bank Corp

Granite Savings Bank & Trust Co.     Banknorth         8,993,684  100%        Vermont
Barre, VT

Woodstock National Bank              Banknorth         4,700,045  100%        Vermont
Woodstock, VT

Banknorth Mortgage Company           First VT          5,414,926  100%        Vermont
Brattleboro, VT

The Stratevest Group, N.A.           Banknorth         3,044,496  100%        Vermont
Burlington, VT

North Group Realty                   Banknorth           258,415  100%        Vermont
St. Albans, VT

BALANCE AS OF SEPTEMBER 30, 1996:

BANKNORTH GROUP, INC. SUBSIDIARIES:

VENTURE CAPITAL FUNDS:

Vermont Venture Capital              Howard               72,715  1.32%       Vermont
                                     First VT            105,346  3.29%       Vermont

North Atlantic Venture Group         First VT            152,355  3.36%       Maine

Green Mountain Capital, LP           Banknorth            91,811  3.27%       Vermont

<F1>  A Massachusetts security corporation is in the process of formation and 
      is expected to be incorporated on or before January 1, 1997.

</TABLE>

 
                                SCHEDULE "3" 
 
                           INDEBTEDNESS AND LIENS 
                     (See Sections 5.14, 6.11 and 6.16) 
<TABLE>
<CAPTION>

 
Indebtedness   Indebtedness        Property         Maturity and Amount 
Incurred By      Owed To      Encumbered (If Any)     of Indebtedness
-----------------------------------------------------------------------
 
<S>            <C>            <C>                   <C>
 
                                    None 
</TABLE>