3215599.01

Exhibit 10.12

CREDIT AGREEMENT
                                   dated as of
                                  March 7, 1997
                                      among
                            CABLETRON SYSTEMS, INC.,
                          CERTAIN SUBSIDIARY BORROWERS,
                            THE LENDERS PARTY HERETO


                            THE CHASE MANHATTAN BANK,
                             as Administrative Agent



                                       and

                       THE FIRST NATIONAL BANK OF CHICAGO
                              as Syndication Agent



                     $250,000,000 REVOLVING CREDIT FACILITY







                                TABLE OF CONTENTS



<PAGE>



ARTICLE IDefinitions 5
      SECTION 1.01. Defined Terms.  5
   SECTION 1.02. Classification of Loans and Borrowings     18
      SECTION 1.03. Terms Generally 18
      SECTION 1.04 Accuonting Terms; GAAP 19

ARTICLE IIThe Credits     19
      SECTION 2.01. Commitments19
      SECTION 2.02. Loans and Borrowings  19
      SECTION 2.03. Requests for Borrowings    20
      SECTION 2.04. Letters of Credit     21
      SECTION 2.05. Funding of Borrowings 25
      SECTION 2.06. Interest Elections    25
      SECTION 2.07. Termination, Reduction and Extension of Commitments 27
      SECTION 2.08. Repayment of Loans; Evidence of Debt 29
      SECTION 2.09. Prepayment of Loans   29
      SECTION 2.10. Fees  30
      SECTION 2.11. Interest   31
      SECTION 2.12. Alternate Rate of Interest 32
      SECTION 2.13. Increased Costs 32
      SECTION 2.14. Break Funding Payments     33
      SECTION 2.15. Taxes 34
   SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of Set-offs 35
      SECTION 2.17. Mitigation Obligations; Replacement of Lenders 36
      SECTION 2.18. Increase of Commitments    37

ARTICLE III     39
      SECTION 3.01 The Guarantee    39
      SECTION 3.02 Obligations Unconditional   39
      SECTION 3.03 Reinstatement    40
      SECTION 3.04 Subrogation 40
      SECTION 3.05 Remedies    41
      SECTION 3.06 Instrument for the Payment of Money   41
      SECTION 3.07 Continuing Guarantee   41

ARTICLE IVRepresentations and Warranties  41
      SECTION 4.01. Organization; Powers  41
      SECTION 4.02. Authorization; Enforceability   41
      SECTION 4.03. Governmental Approvals; No Conflicts 42
      SECTION 4.04. Financial Condition; No Material Adverse Change42
      SECTION 4.05. Properties 42
      SECTION 4.06. Litigation and Environmental Matters 43
      SECTION 4.07. Compliance with Laws and Agreements  43
      SECTION 4.08. Investment and Holding Company Status43
      SECTION 4.09. Taxes 43
      SECTION 4.10. ERISA.43
      SECTION 4.11. Disclosure 44

ARTICLE VConditions  44
      SECTION 5.01. Effective Date  44
      SECTION 5.02. Each Credit Event     45
      SECTION 6.01. Financial  Statements and Other Information45  SECTION 6.02.
      Notices of Material Events 47 SECTION 6.03. Existence; Conduct of Business
      47 SECTION 6.04.  Payment of Obligations  47 SECTION 6.05.  Maintenance of
      Properties; Insuranc 47 SECTION 6.06. Books and Records; Inspection Rights
      48 SECTION 6.07. Compliance with Laws 48 SECTION 6.08. Use of Proceeds 48

ARTICLE VIINegative Covenants  48
      SECTION 7.01. Indebtedness    48
      SECTION 7.02. Liens 49
      SECTION 7.03. Fundamental Changes   49
      SECTION 7.04. Investments, Loans, Advances, Guarantees and Acquisitions;
                    Hedging Agreements.    50
      SECTION 7.05. Transactions with Affiliates    52
      SECTION 7.06. Restrictive Agreements     52
      SECTION 7.07. Leverage Ratio. 53
      SECTION 7.08. Interest Coverage Ratio    53
      SECTION 7.09. Tangible Net Worth    53

ARTICLE XMiscellaneous    57
      SECTION 10.01. Notices   57
      SECTION 10.02. Waivers; Amendments  58
      SECTION 10.03. Expenses; Indemnity: Damage Waiver  59
      SECTION 10.04. Successors and Assigns    60
      SECTION 10.05. Survival. 62
      SECTION 10.06. Counterparts; Integration Effectiveness  62
      SECTION 10.07. Severability   63
      SECTION 10.08. Right of Setoff63
SECTION 10.09. Governing Law; Jurisdiction; Consent to   Service of Process   63
      SECTION 10.10. WAIVER OF JURY TRIAL 64
      SECTION 10.11. Headings  64
      SECTION 10.12. Confidentiality64
      SECTION 10.13. Subsidiary Borrowers 65



<PAGE>




CREDIT AGREEMENT dated as of March 7, 1997, among CABLETRON SYSTEMS,  INC., each
of the  subsidiaries of the Company  designated by the Company from time to time
as Subsidiary Borrowers hereunder, the LENDERS party hereto, THE CHASE MANHATTAN
BANK,  as  Administrative  Agent,  and THE FIRST  NATIONAL  BANK OF CHICAGO,  as
Syndication Agent. The parties hereto agree as follows:

                                    ARTICLE I

                         DefinitionsARTICLE IDefinitions
As used in this  Agreement,  the  following  terms have the  meanings  specified
below:

", when used in reference to any Loan or Borrowing, refers to whether such Loan,
or  the  Loans  comprising  such  Borrowing,  are  bearing  interest  at a  rate
determined by reference to the Alternate Base Rate.

   "Adjusted LIBO Rate" means, with respect to any Eurodollar  Borrowing for any
Interest Period, an interest rate per annum (rounded upwards,  if necessary,  to
the  next  1/16 of 1%)  equal to (a) the LIBO  Rate  for  such  Interest  Period
multiplied by (b) the Statutory Reserve Rate.

   "Administrative  Agent" means The Chase  Manhattan  Bank,  in its capacity as
administrative agent for the Lenders hereunder.

   "Administrative Ouestionnaire" means an Administrative Questionnaire in a 
form supplied by the Administrative Agent.

   "Affiliate"  means, with respect to a specified  Person,  another Person that
directly,  or  indirectly  through  one or more  intermediaries,  Controls or is
Controlled by or is under common Control with the Person specified.

   "Alternate  Base  Rate"  means,  for any day,  a rate per annum  equal to the
greater  of (a) the Prime  Rate in effect on such day or (b) the  Federal  Funds
Effective Rate in effect on such day plus 1/2 of it. Any change in the Alternate
Base Rate due to a change in the Prime Rate or the Federal Funds  Effective Rate
shall be effective  from and including the effective  date of such change in the
Prime Rate or the Federal Funds Effective Rate, respectively.

   "Applicable  Percentage" means, with respect to any Lender, the percentage of
the  total  Commitments   represented  by  such  Lender's  Commitment.   If  the
Commitments  have  terminated or expired,  the Applicable  Percentages  shall be
determined based upon the Commitments most recently in effect,  giving effect to
any assignments.

   "Applicable  Rate"  means,  for any  day,  with  respect  to any ABR  Loan or
Eurodollar  Loan or with respect to the facility  fees  payable  hereunder,  the
applicable  rate per annum set forth in the table below  under the caption  "ABR
Spread",  "Eurodollar  Spread" or "Facility  Fee Rate",  as the case may be, set
forth  opposite  the  applicable  Leverage  Ratio as at the last day of the most
recently ended fiscal quarter of the Company for which financial statements have
been  delivered  pursuant  to Section  6.01(a) or  6.01(b),  as the case may be,
together  with the related  compliance  certificate  for such fiscal  quarter or
fiscal year, as the case may be, required by Section 6.01(c).

----------------------------------------------------------------------------
  Range of Leverage       ABR Spread     Eurodollar Spread   Facility Fee
        Ratio:                                                   Rate
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Greater than or equal         0%               0.45%            0.20%
to 2.00 to 1
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Greater than or equal         0%               0.30%            0.15%
to 1.00 to 1 and less
than 2.00 to 1
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Greater than or equal         0%               0.25%            0.125%
to 0.50 to 1 and less
than 1.00 to 1
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Less than 0.50 to 1           0%               0.20%            0.10%
----------------------------------------------------------------------------


From and including the  Effective  Date to but excluding the fifth  Business Day
following  the date of  receipt  of the  first  financial  statements  delivered
pursuant to Section  6.01(a) or 6.01(b),  as the case may be,  together with the
related  compliance  certificate  for such fiscal quarter or fiscal year, as the
case may be,  required  by  Section  6.01(c),  the  "Applicable  Rate"  shall be
determined  in accordance  with the  certificate  delivered  pursuant to Section
5.01(d).  The  "Applicable  Rate" shall be adjusted  on the fifth  Business  Day
following the date of receipt of the relevant financial  statements  pursuant to
Section  6.01(a)  or  6.01(b),  as the case may be, and the  related  compliance
certificate for such fiscal quarter or fiscal year, as the case may be, required
by Section 6.01(c). In the event the financial statements for any fiscal quarter
or fiscal year or the certificate  required by Section 6.01(c) are not delivered
when due and such  financial  statements  and/or  certificate  are not delivered
prior to the date upon  which the  resultant  Default  shall  become an Event of
Default, then, effective upon such Default becoming an Event of Default,  during
the period from the date upon which such financial  statements  were required to
be delivered  until one Business Day following the date upon which they actually
are delivered,  the  Applicable  Rate with respect to any ABR Loan or Eurodollar
Loan or with respect to the facility fees payable hereunder, as the case may be,
shall be the  highest  rate  provided  for in the above  table;  provided  that,
notwithstanding the foregoing, the Applicable Rate shall not as a consequence of
this  definition  be  reduced  for any period  during  which an Event of Default
arising under clauses (a), (b), (d) (with respect to any covenant,  condition or
agreement  contained in Section  7.07,  7.08 or 7.09),  (h), W or (j) of Article
VIII shall have occurred and be continuing.

   "Assignment and Acceptance"  means an assignment and acceptance  entered into
by a Lender and an  assignee  in  accordance  with  Section  10.04(b)  (with the
consent  of any party  whose  consent is  required  by  Section  10.04(b)),  and
accepted by the Administrative Agent, in the form of Exhibit A or any other form
approved by the Administrative Agent.

   "Availability  Period" means the period from and including the Effective Date
to but excluding the earlier of the Maturity Date and the date of termination of
the Commitments.

"Board" means the Board of Governors of the Federal Reserve System of the United
States of America.

   "Borrowers" means the Company and each Subsidiary Borrower.

   "Borrowing" means Loans of the same Type, made, converted or continued on the
same date and, in the case of Eurodollar  Loans,  as to which a single  Interest
Period is in effect.

   "Borrowing  Request"  means a  request  by the  Company  for a  Borrowing  in
accordance with section 2.03.

   "Business  Day" means any day that is not a Saturday,  Sunday or other day on
which  commercial  banks in New York City are  authorized  or required by law to
remain closed;  provided that, when used in connection  with a Eurodollar  Loan,
the term  "Business  Day" shall  exclude any day on which banks are not open for
dealings in dollar deposits in the London interbank market.

   "Capital  Lease  Obligations"  of any Person  means the  obligations  of such
Person to pay rent or other  amounts  under  any lease of (or other  arrangement
conveying the right to use) real or personal property, or a combination thereof,
which  obligations  are required to be  classified  and accounted for as capital
leases on a balance  sheet of such  Person  under  GAAP,  and the amount of such
obligations  shall be the  capitalized  amount thereof  determined in accordance
with GAAP.

   "Change in  Control"  means (a) the  acquisition  of  ownership,  directly or
indirectly,  beneficially  or of  record,  by any  Person or group  (within  the
meaning  of the  Securities  Exchange  Act of  1934  and  the  rules  of the SEC
thereunder  as in effect on the date  hereof)  (other than Craig R.  Benson,  S.
Robert  Levine,  Kenneth R. Levine  and/or  Christopher  J.  Oliver),  of shares
representing more than 40 of the aggregate  ordinary voting power represented by
the issued and  outstanding  capital stock of the Company or (b) occupation of a
majority of the seats (other than vacant seats) on the board of directors of the
Company by Persons who were  neither (i)  nominated by the board of directors of
the Company nor (ii) appointed by directors so nominated.

   "Change in Law" means (a) the adoption of any law, rule or  regulation  after
the date of this Agreement,  (b) any change in any law, rule or regulation or in
the  interpretation or application  thereof by any Governmental  Authority after
the date of this  Agreement or (c)  compliance by any Lender or the Issuing Bank
(or, for purposes of Section 2.13(b), by any lending office of such Lender or by
such Lender's or the Issuing Bank's holding  company,  if any) with any request,
guideline  or  directive  (whether  or not  having  the  force  of  law)  of any
Governmental Authority made or issued after the date of this Agreement.

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

   "Commitment"  means,  with respect to each  Lender,  the  commitment  of such
Lender to make  Revolving  Loans and to  acquire  participations  in  Letters of
Credit  hereunder,  expressed as an amount  representing  the maximum  aggregate
amount of such Lender's Revolving Credit Exposure hereunder,  as such commitment
may be (a) reduced from time to time  pursuant to Section  2.07,  (b)  increased
from time to time  pursuant to Section  2.18 and (c) reduced or  increased  from
time to time pursuant to  assignments  by or to such Lender  pursuant to Section
10.04.  The initial amount of each Lender's  Commitment is set forth on Schedule
2.01, or in the Assignment  and  Acceptance  pursuant to which such Lender shall
have assumed its Commitment, as applicable.

"Company" means Cabletron Systems, Inc., a Delaware corporation.

      "Control"  means the possession,  directly or indirectly,  of the power to
direct or cause the direction of the management or policies of a Person, whether
through  the  ability to  exercise  voting  power,  by  contract  or  otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.

      "Credit  Documents" means this Agreement and the promissory notes (if any)
delivered pursuant to Section 2.08(e).

      "Credit Parties" means, collectively, the Borrowers and the Guarantor.

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

"dollars" or "$" refers to lawful money of the United States of America.
"EBITDA"  means,  for any period,  the sum for the Company and its  Subsidiaries
(determined on a consolidated basis without  duplication) of the following:  (a)
net income for such period (calculated after eliminating extraordinary gains and
losses and unusual or  non-recurring  items) plus (b) income and other taxes (to
the  extent  deducted  in  determining  net  income)  for such  period  plus (c)
depreciation,  amortization and any other non-cash charges,  including,  without
limitation,  purchase accounting  adjustments  required or permitted by Opinions
No.  16  and  17 of  the  Accounting  Principles  Board  and  the  write-off  of
in-progress  technology  and  research  and  development  in  connection  with a
permitted  acquisition  (to the extent  deducted in determining  net income) for
such period plus (d) the  aggregate  amount of Interest  Expense for such period
minus (e) the aggregate amount of interest income for such period (to the extent
not included in computing Interest Expense).

      "Effective  Date"  means the date on which  the  conditions  specified  in
Section 5.01 are satisfied (or waived in accordance with Section 10.02).

      "Environmental   Laws"  means  all  laws,   rules,   regulations,   codes,
ordinances,  orders,  decrees,  judgments,   injunctions,   notices  or  binding
agreements  issued,  promulgated or entered into by any Governmental  Authority,
relating in any way to the  environment,  preservation or reclamation of natural
resources,  the  management,  release or  threatened  release  of any  Hazardous
Material or to health and safety matters.

      "Environmental  Liability"  means any  liability,  contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties  or  indemnities),  of the  Company  or  any  Subsidiary  directly  or
indirectly  resulting from or based upon (a) violation of any Environmental Law,
(b)  the  generation,  use,  handling,  transportation,  storage,  treatment  or
disposal of any Hazardous  materials,  (c) exposure to any Hazardous  Materials,
(d) the  release or  threatened  release  of any  Hazardous  Materials  into the
environment  or (e) any  contract,  agreement  or other  consensual  arrangement
pursuant to which  liability  is assumed or imposed  with  respect to any of the
foregoing.

      "ERISA"  means the Employee  Retirement  Income  Security Act of 1974,  as
amended from time to time.

      "ERISA   Affiliate"   means  any  trade  or   business   (whether  or  not
incorporated)  that,  together with the Company, is treated as a single employer
under  Section  414(b) or (c) of the Code or, solely for purposes of Section 302
of ERISA and  Section  412 of the Code,  is treated as a single  employer  under
Section 414 of the Code.

      "ERISA Event" means (a) any "reportable event", as defined in Section 4043
of ERISA or the regulations issued thereunder with respect to a Plan (other than
an event for which the 30-day notice period is waived);  (b) the existence  with
respect  to any Plan of an  "accumulated  funding  deficiency"  (as  defined  in
section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the
filing  pursuant to Section  412(d) of the Code or Section 303(d) of ERISA of an
application  for a waiver of the minimum  funding  standard  with respect to any
Plan;  (d) the  incurrence by the Company or any of its ERISA  Affiliates of any
liability  under Title IV of ERISA with respect to the  termination of any Plan;
(e) the  receipt by the Company or any ERISA  Affiliate  from the PBGC or a plan
administrator  of any notice  relating to an intention to terminate  any Plan or
Plans or to appoint a trustee to administer  any Plan; (f) the incurrence by the
Company or any of its ERISA  Affiliates  of any  liability  with  respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the
receipt by the Company or any ERISA  Affiliate of any notice,  or the receipt by
any  Multiemployer  Plan from the Company or any ERISA  Affiliate of any notice,
concerning  the  imposition of Withdrawal  Liability or a  determination  that a
Multiemployer  Plan is, or is expected to be,  insolvent  or in  reorganization,
within the meaning of Title IV of ERISA.

      "Eurodollar",  when used in reference to any Loan or Borrowing,  refers to
whether such Loan, or the Loans comprising such Borrowing,  are bearing interest
at a rate determined by reference to the Adjusted LIBO Rate.

      "Event of Default" has the meaning assigned to such term in Article VIII.

      "Excluded  Taxes" means,  with respect to the  Administrative  Agent,  any
Lender,  the Issuing Bank or any other recipient of any payment to be made by or
on account of any obligation of any Borrower hereunder,  (a) income or franchise
taxes  imposed  on (or  measured  by) its net  income  by the  United  States of
America, or any state or political  subdivision  thereof, or by the jurisdiction
under the laws of which such  recipient is  organized or in which its  principal
office is located or, in the case of any Lender, in which its applicable lending
office is located, or in each case any political  subdivision  thereof,  (b) any
branch  profits  taxes  imposed by the United  States of America or any state or
political   subdivision  thereof  or  any  similar  tax  imposed  by  any  other
jurisdiction  in which any  Borrower is located,  or any  political  subdivision
thereof,  and  (c) in the  case  of a  Foreign  Lender  to  the  Company  or any
Subsidiary  Borrower organized under the laws of the United States of America or
any State thereof  (other than an assignee  pursuant to a request by the Company
under Section  2.17(b)),  any withholding tax that is imposed on amounts payable
by the Company or such Subsidiary Borrower,  as the case may be, to such Foreign
Lender at the time such Foreign Lender becomes a party to this Agreement (except
to the extent that such Foreign Lender's assignor (if any) was entitled,  at the
time of  assignment,  to receive  additional  amounts  from the  Company or such
Subsidiary  Borrower,  as the case may be, with respect to such  withholding tax
pursuant to Section 2.15(a)) or is attributable to such Foreign Lender's failure
or inability to comply with Section 2.15(e).

      "Federal Funds  Effective Rate" means,  for any day, the weighted  average
(rounded  upwards,  if  necessary,  to the  next  1/100  of 1% of the  rates  on
overnight Federal funds  transactions with members of the Federal Reserve System
arranged by Federal funds brokers,  as published on the next succeeding Business
Day by the  Federal  Reserve  Bank  of New  York,  or,  if  such  rate is not so
published for any day that is a Business Day, the average (rounded  upwards,  if
necessary,  to the  next  1/100 of 1%) of the  quotations  for such day for such
transactions  received  by the  Administrative  Agent from three  Federal  funds
brokers of recognized standing selected by it.

      "Financial   officer"  means  the  chief  financial   officer,   principal
accounting officer, treasurer or controller of the Company.

      "Foreign  Lender"  means any Lender that is organized  under the laws of a
jurisdiction  other than the United States of America,  any State thereof or the
District of Columbia.

      "GAAP" means generally accepted accounting principles in the United States
of America.

      "Governmental  Authority"  means the  government  of the United  States of
America, any other nation or any political subdivision thereof, whether state or
local,  and any agency,  authority,  instrumentality,  regulatory  body,  court,
central  bank or  other  entity  exercising  executive,  legislative,  judicial,
taxing,  regulatory  or  administrative  powers or functions of or pertaining to
government.

      "Guarantee" of or by any Person (the  "guarantor")  means any  obligation,
contingent or otherwise,  of the guarantor  guaranteeing  or having the economic
effect of guaranteeing  any Indebtedness or other obligation of any other Person
(the  "primary  obligor") in any manner,  whether  directly or  indirectly,  and
including any obligation of the guarantor,  direct or indirect,  (a) to purchase
or pay (or  advance  or  supply  funds  for the  purchase  or  payment  of) such
Indebtedness  or other  obligation or to purchase (or to advance or supply funds
for the purchase of) any  security for the payment  thereof,  (b) to purchase or
lease property,  securities or services for the purpose of assuring the owner of
such  Indebtedness or other obligation of the payment  thereof,  (c) to maintain
working capital,  equity capital or any other financial  statement  condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness  or other  obligation  or (d) as an account party in respect of any
letter of credit or letter of guaranty  issued to support such  Indebtedness  or
obligation;  provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.

"Guarantor" means the Company, as guarantor of the obligations of the Subsidiary
Borrowers.

      "Hazardous  Materials"  means all explosive or  radioactive  substances or
wastes  and all  hazardous  or toxic  substances,  wastes  or other  pollutants,
including  petroleum or petroleum  distillates,  asbestos or asbestos containing
materials,  polychlorinated  biphenyls,  radon gas, infectious or medical wastes
and all other  substances  or wastes of any  nature  regulated  pursuant  to any
Environmental Law.

      "Hedging Agreement" means any interest rate protection agreement,  foreign
currency  exchange  agreement,  commodity  price  protection  agreement or other
interest or currency exchange rate or commodity price hedging arrangement.

      "Indebtedness"  of  any  Person  means,  without   duplication,   (a)  all
obligations  of such Person for  borrowed  money,  (b) all  obligations  of such
Person evidenced by bonds,  debentures,  notes or similar  instruments,  (c) all
obligations  of such Person  under  conditional  sale or other  title  retention
agreements  relating to property acquired by such Person, (d) all obligations of
such Person in respect of the  deferred  purchase  price of property or services
due more than one year from the date of purchase, (e) all Indebtedness of others
secured by (or for which the holder of such  Indebtedness has an existing right,
contingent  or  otherwise,  to be  secured  by) any  Lien on  property  owned or
acquired by such Person,  whether or not the  Indebtedness  secured  thereby has
been assumed,  (f) all Guarantees by such Person of Indebtedness of others other
than  Permitted  Vendor  Financing,  (g) all Capital Lease  Obligations  of such
Person,  (h) all  obligations,  contingent  or  otherwise,  of such Person as an
account party in respect of letters of credit and letters of guaranty  exceeding
$50,000,000 in the aggregate,  W all  obligations,  contingent or otherwise,  of
such  Person in respect of  bankers'  acceptances  and (j) (for  purposes of the
Leverage  Ratio only) all  obligations of such Person under any lease treated as
an  operating  lease under GAAP and as a loan or financing  for U.S.  income tax
purposes (and, for purposes of determining the amount of Indebtedness  reflected
by such lease, the stipulated loss value,  termination value or other equivalent
amount  shall be  used).  The  Indebtedness  of any  Person  shall  include  the
Indebtedness of any other entity (including any partnership in which such Person
is a general  partner) to the extent such Person is liable  therefor as a result
of such Person's  ownership  interest in or other relationship with such entity,
except to the extent the terms of such Indebtedness  provide that such Person is
not liable therefor.

"Indemnified Taxes" means Taxes other than Excluded Taxes and Other Taxes.

      "Interest  Coverage  Ratio" means, as at any date, the ratio of (a) EBITDA
for the period of four consecutive  fiscal quarters of the Company ending on, or
most recently ended prior to, such date to (b) Interest  Expense paid or payable
in cash for such period.

      "Interest  Election  Request" means a request by the Company to convert or
continue a Borrowing in accordance with Section 2.09.

      "Interest Expense" means, for any period, the sum, for the Company and its
Subsidiaries  (determined on a consolidated basis without  duplication),  of the
following:  (a) all interest in respect of  Indebtedness  accrued or capitalized
during such period  (whether or not  actually  paid during such period) plus (b)
the net amounts  payable (or minus the net amounts  receivable)  under  interest
rate protection  agreements  accrued during such period (whether or not actually
paid or received during such period) including,  without  limitation,  fees, but
excluding reimbursement of legal fees and other similar transaction costs.
      "Interest  Payment Date" means (a) with respect to any ABR Loan,  the last
day of each March,  June,  September  and  December  and (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and, in the case of a Eurodollar  Borrowing with an
Interest Period of more than three months,  duration, each day prior to the last
day of such Interest  Period that occurs at intervals of three months,  duration
after the first day of such Interest Period.

      "Interest  Period"  means with respect to any  Eurodollar  Borrowing,  the
period  commencing on the date of such  Borrowing and ending on the  numerically
corresponding  day in the calendar  month that is one, two,  three or six months
(or, with the consent of each Lender, nine or twelve months) thereafter,  as the
Company may elect;  provided that (i) if any Interest  Period would end on a day
other than a Business Day,  such  Interest  Period shall be extended to the next
succeeding Business Day unless, in the case of a Eurodollar Borrowing only, such
next  succeeding  Business Day would fall in the next calendar  month,  in which
case such Interest Period shall end on the next preceding  Business Day and (ii)
any Interest Period  pertaining to a Eurodollar  Borrowing that commences on the
last  Business  Day of a  calendar  month  (or on a day for  which  there  is no
numerically  corresponding  day in the  last  calendar  month  of such  Interest
Period)  shall end on the last Business  Day-of the last calendar  month of such
Interest Period. For purposes of this definition,  the date of a Borrowing shall
be the date on which such  Borrowing is made or the  effective  date of the most
recent conversion or continuation of a Borrowing, as the case may be.

      "Issuing  Bank" means The Chase  Manhattan  Bank,  in its  capacity as the
issuer of Letters of Credit  hereunder,  and its  successors in such capacity as
provided in Section  2.04(i).  The Issuing Bank may, in its discretion,  arrange
for one or more  Letters  of Credit to be issued by  Affiliates  of the  Issuing
Bank,  in which case the term "Issuing  Bank" shall  include any such  Affiliate
with respect to Letters of Credit issued by such Affiliate.

      "LC  Disbursement"  means a payment made by the Issuing Bank pursuant to a
Letter of Credit.

      "LC Exposure"  means,  at any time,  the sum of (a) the aggregate  undrawn
amount of all outstanding  Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf
of the Company at such time.  The LC Exposure of any Lender at any time shall be
its Applicable Percentage of the total LC Exposure at such time.

      "Lenders"  means the Persons  listed on Schedule 2.01 and any other Person
that shall have become a party hereto  pursuant to an Assignment and Acceptance,
Section  2.07 or Section  2.18,  other than any such  Person that ceases to be a
party hereto pursuant to an Assignment and Acceptance or Section 2.07.

"Letter of Credit" means any letter of credit issued pursuant to this Agreement.
"Leverage Ratio" means, as at any date, the ratio of (a) all Indebtedness of the
Company  and  its  Subsidiaries  (determined  on a  consolidated  basis  without
duplication)  on such date to (b)  EBITDA  for the  period  of four  consecutive
fiscal  quarters of the Company ending on, or most recently ended prior to, such
date.

      "LIBO  Rate"  means,  with  respect to any  Eurodollar  Borrowing  for any
Interest Period,  the rate appearing on Page 3750 of the Telerate Service (or on
any  successor  or  substitute  page of such  Service,  or any  successor  to or
substitute  for such  Service,  providing  rate  quotations  comparable to those
currently  provided  on  such  page  of  such  Service,  as  determined  by  the
Administrative  Agent from time to time for purposes of providing  quotations of
interest rates applicable to dollar deposits in the London interbank  market) at
approximately   11:00  a.m.,  London  time,  two  Business  Days  prior  to  the
commencement  of such Interest  Period,  as the rate for dollar  deposits with a
maturity  comparable to such Interest Period. In the event that such rate is not
available at such time for any reason, then the "LIBO Rate" with respect to such
Eurodollar  Borrowing for such Interest Period shall be the rate at which dollar
deposits of $5,000,000 and for a maturity comparable to such Interest Period are
offered  by  the  principal  London  office  of  the  Administrative   Agent  in
immediately  available  funds in the London  interbank  market at  approximately
11:00 a.m.,  London time,  two Business Days prior to the  commencement  of such
Interest Period.

      "Lien" means, with respect to any asset, (a) any mortgage,  deed of trust,
lien, pledge, hypothecation,  encumbrance, charge or security interest in, on or
of such asset or (b) the interest of a vendor or a lessor under any  conditional
sale  agreement,  capital lease or title  retention  agreement (or any financing
lease having  substantially  the same economic  effect as any of the  foregoing)
relating to such asset.

  "Loans" means the loans made by the Lenders to the Borrowers pursuant to this
Agreement.

      "Margin  Stock" means "margin  stock" within the meaning of  Regulations U
and X of the Board (or any successor regulation thereto).

      "Material  Adverse  Effect"  means a  material  adverse  effect on (a) the
business, assets, operations, prospects or condition, financial or otherwise, of
the Company and its Subsidiaries taken as a whole, (b) the ability of any Credit
Party to perform any of its  obligations  under any of the Credit  Documents  to
which it is a party or (c) the  rights  or  remedies  of the  Lenders  under the
Credit Documents.

      "Material  Subsidiary" means, as of any date, any Subsidiary (a) the value
of whose net assets  equals or exceeds 5% of the net assets of the  Company  and
its  Subsidiaries  on a  consolidated  basis or (b)  whose  net  profits  before
interest and taxation  equals or exceeds 5% of the net profits  before  interest
and taxation of the Company and its Subsidiaries on a consolidated basis.
      "Maturity Date" means March 31, 2000,  subject to extension as provided in
Section 2.07(d).

      "Moody's" means Moody's Investors Service, Inc.

      "Multiemplover Plan" means a multiemployer plan as defined in Section 
4001(a)(3) of ERISA.

      "Other  Taxes"  means any and all present or future  stamp or  documentary
taxes or any other excise or property  taxes,  charges or similar levies arising
from the execution,  delivery or  enforcement  of, or otherwise with respect to,
this  Agreement  and the other Credit  Documents,  provided  that there shall be
excluded from "Other Taxes" all Excluded Taxes.

      "PBGC"  means the Pension  Benefit  Guaranty  Corporation  referred to and
defined in ERISA and any successor entity performing similar functions.

      "Permitted Encumbrances" means:

      (a) Liens imposed by law for taxes that are not yet due or are being 
      contested in compliance with Section 6.04;

      (b) carriers',  warehousemen's,  mechanics',  materialmen's,  repairmen's,
      statutory  landlord's and other like Liens imposed by law,  arising in the
      ordinary course of business and securing  obligations that are not overdue
      by more than 60 days or are being  contested  in  compliance  with Section
      6.04;

      (c)  pledges  and  deposits  made in the  ordinary  course of  business in
      compliance with workers'  compensation,  unemployment  insurance and other
      social security laws or regulations;

      (d) deposits to secure the performance of bids, trade  contracts,  leases,
      statutory  obligations,  surety and appeal  bonds,  performance  bonds and
      other obligations of a like nature, in each case in the ordinary course of
      business;

      (e) Liens arising from judgments that do not constitute an Event of 
      Default under clause W of Article VIII;

      (f) licenses, leases and subleases granted to other Persons in the 
      ordinary course of business; and

      (g) easements, zoning restrictions, rights-of-way and similar encumbrances
      on real  property  imposed  by law or arising  in the  ordinary  course of
      business that do not secure any monetary obligations and do not materially
      detract  from the value of the  affected  property or  interfere  with the
      ordinary conduct of business of the Company or any Subsidiary;

provided  that the term  "Permitted  Encumbrances"  shall not  include  any Lien
securing Indebtedness.

"Permitted Investments" means:

      (a) direct obligations of, or obligations the principal of and interest on
      which are unconditionally  guaranteed by, the United States of America (or
      by any agency  thereof to the extent  such  obligations  are backed by the
      full  faith and  credit of the  United  States of  America),  in each case
      maturing within one year from the date of acquisition thereof;

      (b) investments in commercial paper maturing within 270 days from the date
      of acquisition  thereof and having, at such date of acquisition,  a credit
      rating of at least A-2 from S&P or P-2 from Moody's;

      (c) investments in certificates of deposit,  banker's acceptances and time
      deposits  maturing  within 180 days from the date of  acquisition  thereof
      issued or guaranteed by or placed with, and money market deposit  accounts
      issued or offered by, any domestic office of any commercial bank organized
      under the laws of the United  States of America or any State thereof which
      has a combined capital and surplus and undivided  profits of not less than
      $250,000,000;

      (d)  repurchase  agreements  with a term of not  more  than  30  days  for
      securities described in clause (a) above and entered into with a financial
      institution satisfying the criteria described in clause (c) above;

      (e)  investments  in money market  mutual funds  substantially  all of the
      assets  of which  are  comprised  of  securities  of the type set forth in
      clauses (a), (b), (c), (d), (f) and/or (g) of this definition,  so long as
      such  fund  has  total  assets  of at  least  $1,000,000,000  and has been
      established for at least two years;

      (f)  investments in medium term notes issued by corporations or banks with
      a long term debt rating of at least BBB+ by S&P or Baal by Moody's;

      (g)  investments  in  tax-exempt  municipal   obligations  of  any  state,
      commonwealth  or  territory  of the United  States of  America,  or by any
      political subdivision or taxing authority thereof, with a credit rating of
      at least BBB+ by S&P or Baal by Moody's; and

      (h) investments in auction rate preferred stock or money market  preferred
      stock,  in each case with a credit  rating of at least BBB+ by S&P or Baal
      by Moody's.

      "Permitted Vendor Financing" means Guarantees issued by the Company or any
Subsidiary  in  respect of  obligations  of  customers  in  connection  with the
financing of sales of inventory  and services to such  customers in an aggregate
amount at any one time not exceeding $100,000,000.

      "Person" means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership,  Governmental Authority
or other entity.

      "Plan" means any employee pension benefit plan (other than a Multiemployer
Plan) subject to the  provisions of Title IV of ERISA or Section 412 of the Code
or  Section  302 of ERISA,  and in  respect  of which the  Company  or any ERISA
Affiliate  is (or, if such plan were  terminated,  would under  Section  4069 of
ERISA be deemed to be) an "employer" as defined in Section 3(5) of ERISA.

      "Prime Rate" means the rate of interest per annum publicly  announced from
time to time by The  Chase  Manhattan  Bank as its  prime  rate in effect at its
principal  office in New York  City;  each  change in the  Prime  Rate  shall be
effective from and including the date such change is publicly announced as being
effective.

      "Register" has the meaning set forth in Section 10. 04 (c) .

      "Related  Parties"  means,  with  respect to any  specified  Person,  such
Person's Affiliates and the respective directors,  officers,  employees,  agents
and advisors of such Person and such Person's Affiliates.

      "Required  Lenders" means, at any time,  Lenders having  Revolving  Credit
Exposures  and unused  Commitments  representing  at least 51% of the sum of the
total Revolving Credit Exposures and unused Commitments at such time.

      "Restricted Payment" means any dividend or other distribution  (whether in
cash,  securities or other  property) with respect to any shares of any class of
capital stock of the Company or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption,  retirement,  acquisition,  cancellation or
termination  of any such  shares of capital  stock of the Company or any option,
warrant  or other  right to  acquire  any such  shares of  capital  stock of the
Company.

      "Revolving Credit Exposure" means, with respect to any Lender at any time,
the sum of the  outstanding  principal  amount of such Lender's Loans and its LC
Exposure at such time.
      "SEC" means the  Securities  and Exchange  Commission or any  governmental
authority succeeding to its principal functions.

      "S&P" means Standard & Poors.

      "Statutory  Reserve Rate" means a fraction  (expressed as a decimal),  the
numerator of which is the number one and the  denominator of which is the number
one minus the  aggregate  of the  maximum  reserve  percentages  (including  any
marginal,  special,  emergency or supplemental  reserves) expressed as a decimal
established  by the  Board to which  the  Administrative  Agent is  subject  for
eurocurrency  funding  (currently  referred to as "Eurocurrency  Liabilities" in
Regulation D of the Board). Such reserve percentages shall include those imposed
pursuant to such  Regulation D.  Eurodollar  Loans shall be deemed to constitute
eurocurrency  funding  and to be subject to such  reserve  requirements  without
benefit of or credit for proration,  exemptions or offsets that may be available
from  time to time to any  Lender  under  such  Regulation  D or any  comparable
regulation. The Statutory Reserve Rate shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.

      "subsidiary" means, with respect to any Person (the "parent") at any date,
any corporation,  limited liability company,  partnership,  association or other
entity (a) of which securities or other ownership  interests  representing  more
than 50% of the equity or more than 50% of the ordinary  voting power or, in the
case of a partnership,  more than 50% of the general partnership  interests are,
as of such  date,  owned,  controlled  or held or (b) that is, as of such  date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.

      "Subsidiary" means any subsidiary of the Company.

"Subsidiary Borrower" means any Subsidiary designated as a Borrower pursuant to
      Section 10.13.

      "Syndication  Agent"  means The First  National  Bank of  Chicago,  in its
capacity as syndication agent hereunder.

      "Tangible Net Worth" means, as at any date for any Person, the sum for the
Company  and  its  Subsidiaries  (determined  on a  consolidated  basis  without
duplication), of the following:

      (a) the amount of capital stock; plus

      (b) the amount of surplus  and  retained  earnings  (or,  in the case of a
      surplus or retained earnings  deficit,  minus the amount of such deficit);
      minus


      (c) the sum of the following:  cost of treasury  shares and the book value
      of  all  assets  that  should  be  classified  as   intangibles   (without
      duplication of deductions in respect of items already deducted in arriving
      at surplus and retained  earnings)  but in any event  including  goodwill,
      minority  interests,  research and development  costs,  trademarks,  trade
      names, copyrights,  patents and franchises,  unamortized debt discount and
      expense,  all  reserves  and any  write-up  in the book  value  of  assets
      resulting from a revaluation thereof subsequent to February 29, 1996.

      "Taxes"  means any and all  present  or  future  taxes,  levies,  imposts,
duties,  deductions,   charges  or  withholdings  imposed  by  any  Governmental
Authority.

      "Transactions" means the execution, delivery and performance by the Credit
Parties of the Credit  Documents,  the Borrowing of Loans hereunder,  the use of
the proceeds thereof and the issuance of Letters of Credit hereunder.

      "Type", when used in reference to any Loan or Borrowing, refers to whether
the rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.

      "Withdrawal Liability" means liability to a Multiemployer Plan as a result
of a complete or partial withdrawal from such Multiemployer  Plan, as such terms
are defined in Part I of Subtitle E of Title IV of ERISA.

      SECTION  1.02.   Classification  of  Loans  and  BorrowingsSECTION   1.02.
Classification  . For purposes of this  Agreement,  Loans and  Borrowings may be
classified  and referred to by Type (e.g.,  a "Eurodollar  Loan" or  "Eurodollar
Borrowing", as the case may be).

 . The definitions of terms herein shall apply equally to the singular and plural
forms of the terms defined.  Whenever the context may require, any pronoun shall
include  the  corresponding  masculine,  feminine  and neuter  forms.  The words
"include",  "includes"  and  "including"  shall be deemed to be  followed by the
phrase "without limitation". The word "will" shall be construed to have the same
meaning and effect as the word "shall".  Unless the context  requires  otherwise
(a) any  definition  of or  reference  to any  agreement,  instrument  or  other
document herein shall be construed as referring to such agreement, instrument or
other document as from time to time amended,  supplemented or otherwise modified
(subject to any  restrictions on such  amendments,  supplements or modifications
set forth herein),  (b) any reference herein to any Person shall be construed to
include such Person's successors and assigns,  (c) the words "herein",  "hereof"
and  "hereunder",  and words of similar  import,  shall be construed to refer to
this Agreement in its entirety and not to any particular  provision hereof,  (d)
all references  herein to Articles,  Sections,  Exhibits and Schedules  shall be
construed to refer to Articles and Sections of, and Exhibits and  Schedules  to,
this  Agreement and (e) the words "asset" and  "property"  shall be construed to
have the same  meaning  and  effect  and to  refer to any and all  tangible  and
intangible  assets and  properties,  including  cash,  securities,  accounts and
contract rights.

 . Accounting Terms;  GAAP. Except as otherwise  expressly  provided herein,  all
terms of an accounting or financial nature shall be construed in accordance with
GAAP, as in effect from time to time; provided that, if the Company notifies the
Administrative  Agent that the Company  requests an amendment  to any  provision
hereof to eliminate the effect of any change  occurring after the date hereof in
GAAP or in the application thereof on the operation of such provision (or if the
Administrative  Agent notifies the Company that the Required  Lenders request an
amendment to any provision  hereof for such purpose),  regardless of whether any
such notice is given  before or after such change in GAAP or in the  application
thereof,  then such provision  shall be interpreted on the basis,  of GAAP as in
effect and applied  immediately  before such change shall have become  effective
until  such  notice  shall  have been  withdrawn  or such  provision  amended in
accordance herewith.


                                   ARTICLE II

                                   The Credits
ARTICLE IIThe Credits
 . Subject to the terms and  conditions  set forth herein,  each Lender agrees to
make Loans from time to time  during the  Availability  Period to the Company or
one or more Subsidiary Borrowers hereunder in an aggregate principal amount that
will not  result in such  Lender's  Revolving  Credit  Exposure  exceeding  such
Lender's  Commitment.  Within the foregoing  limits and subject to the terms and
conditions  set forth  herein,  the  Borrowers  may borrow,  prepay and reborrow
Loans.


 .ECTION 2.02. Loans and BorrowingsSECTION 2.02. Loans and Borrowings

      (a) Each Loan  shall be made as part of a  Borrowing  consisting  of Loans
made by the Lenders ratably in accordance with their respective Commitments. The
failure  of any  Lender  to make any Loan  required  to be made by it shall  not
relieve  any  other  Lender  of its  obligations  hereunder;  provided  that the
Commitments  of the Lenders are several and no Lender shall be  responsible  for
any other Lender's failure to make Loans as required.

      (b) Subject to Section 2.12, each Borrowing shall be comprised entirely of
ABR Loans or Eurodollar Loans as the Company may request in accordance herewith.
Each Lender at its option may make any  Eurodollar  Loan by causing any domestic
or foreign  branch or Affiliate of such Lender to make such Loan;  provided that
any exercise of such option shall not affect the  obligation of the Borrowers to
repay such Loan in accordance with the terms of this Agreement.


      (c) At the commencement of each Interest Period for Eurodollar  Borrowing,
such Borrowing shall be in an aggregate  amount that is an integral  multiple of
$100,000 and not less than  $2,000,000.  At the time that each ABR  Borrowing is
made,  such  Borrowing  shall  be in an  aggregate  amount  that is an  integral
multiple of $100,000 and not less than $500,000;  provided that an ABR Borrowing
may be in an  aggregate  amount  that is equal to the amount that is required to
finance the  reimbursement  of an LC  Disbursement  as  contemplated  by Section
2.04(e).  Borrowings of more than one Type may be  outstanding at the same time;
provided  that  there  shall  not at any  time be more  than a  total  of  eight
Eurodollar Borrowings outstanding.

      (d)  Notwithstanding  any other provision of this  Agreement,  the Company
shall not be  entitled  to  request,  or to elect to  convert or  continue,  any
Borrowing if the Interest Period  requested with respect thereto would end after
the Maturity Date.

 . To request a Borrowing,  the Company shall notify the Administrative  Agent of
such request by telephone (a) in the case of a Eurodollar  Borrowing,  not later
than 1:00 p.m.,  New York City time,  three Business Days before the date of the
proposed Borrowing or (b) in the case of an ABR Borrowing,  not later than 11:00
a.m.,  New York City  time,  on the date of the  proposed  Borrowing.  Each such
telephonic  Borrowing  Request  shall be  irrevocable  and  shall  be  confirmed
promptly by hand delivery or telecopy to the  Administrative  Agent of a written
Borrowing Request in a form approved by the  Administrative  Agent and signed by
the Company.  Each such telephonic and written  Borrowing  Request shall specify
the following information in compliance with Section 2.02:

(i)   the aggregate amount of the requested Borrowing;

      (ii) the date of such Borrowing, which shall be a
Business Day;

      (iii)the identity of the Borrower for such Borrowing;

(iv)     whether such Borrowing is to be an ABR
Borrowing or a Eurodollar Borrowing;

      (v) in the case of a Eurodollar Borrowing,  the initial Interest Period to
be applicable thereto, which shall be a period contemplated by the definition of
the term "Interest Period"; and

      (vi) the  location  and  number,  of the  account  of the  Company  or the
applicable Subsidiary Borrower to which funds are to be disbursed.

If no election as to the Type of  Borrowing  is  specified,  then the  requested
Borrowing  shall be an ABR  Borrowing.  If no Interest  Period is specified with
respect to any requested Eurodollar Borrowing,  then the Company shall be deemed
to have selected an Interest Period of one month's duration.  Promptly following
receipt  of  a  Borrowing   Request  in  accordance   with  this  Section,   the
Administrative  Agent shall advise each Lender of the details thereof and of the
amount of such Lender's Loan to be made as part of the requested Borrowing.

 .     SECTION 2.04. Letters of CreditSECTION 2.04. Letters of Credit

      (a) General.  Subject to the terms and  conditions  set forth herein,  the
Company may request the issuance of Letters of Credit for its own account or for
the  account  of  any  Subsidiary,  in  a  form  reasonably  acceptable  to  the
Administrative  Agent and the  Issuing  Bank,  at any time and from time to time
during the Availability  Period. In the event of any  inconsistency  between the
terms and  conditions of this Agreement and the terms and conditions of any form
of letter of credit application or other agreement  submitted by the Company to,
or entered into by the Company with,  the Issuing Bank relating to any Letter of
Credit, the terms and conditions of this Agreement shall control.

      (b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions.
To request  the  issuance  of a Letter of Credit (or the  amendment,  renewal or
extension of an outstanding Letter of Credit), the Company shall hand deliver or
telecopy (or transmit by electronic communication,  if arrangements for doing so
have  been   approved  by  the  Issuing  Bank)  to  the  Issuing  Bank  and  the
Administrative  Agent  (reasonably in advance of the requested date of issuance,
amendment, renewal or extension) a notice requesting the issuance of a Letter of
Credit, or identifying the Letter of Credit to be amended,  renewed or extended,
the date of issuance,  amendment,  renewal or extension,  the date on which such
Letter of Credit is to expire  (which  shall comply with  paragraph  (c) of this
Section),  the  amount of such  Letter of  Credit,  the name and  address of the
beneficiary thereof and such other information as shall be necessary to prepare,
amend,  renew or extend such Letter of Credit. If requested by the Issuing Bank,
the  Company  also shall  submit a letter of credit  application  on the Issuing
Bank's standard form in connection with any request for a Letter of Credit, with
such changes  thereto as the Company and the Issuing Bank may agree. A Letter of
Credit shall be issued, amended, renewed or extended only if (and upon issuance,
amendment,  renewal or extension  of each Letter of Credit the Company  shall be
deemed to represent and warrant  that),  after giving  effect to such  issuance,
amendment, renewal or extension (i) the LC Exposure shall not exceed $50,000,000
and (ii) the sum of the total  Revolving  Credit  Exposures shall not exceed the
total Commitments.

      (c) Expiration Date. Each Letter of Credit shall expire at or prior to the
close of  business  on the  earlier of W the date one year after the date of the
issuance of such  Letter of Credit (or, in the case of any renewal or  extension
thereof,  one year after such  renewal or  extension)  and (ii) the date that is
five Business Days prior to the Maturity Date.

      (d) Participations. By the issuance of a Letter of Credit (or an amendment
to a Letter of Credit  increasing  the amount  thereof)  and without any further
action on the part of the Issuing Bank or the  Lenders,  the Issuing Bank hereby
grants to each Lender (other than the Issuing Bank), and each Lender (other than
the Issuing Bank) hereby acquires from the Issuing Bank, a participation in such
Letter of Credit equal to such Lender's  Applicable  Percentage of the aggregate
amount available to be drawn under such Letter of Credit.  In consideration  and
in   furtherance   of  the   foregoing,   each  Lender  hereby   absolutely  and
unconditionally  agrees to pay to the  Administrative  Agent, for the account of
the Issuing Bank,  such Lender's  Applicable  Percentage of each LC Disbursement
made by the Issuing  Bank and not  reimbursed  by the Company on the date due as
provided in  paragraph  (e) of this  Section,  or of any  reimbursement  payment
required to be refunded to the Company for any reason.  Each Lender  (other than
the  Issuing  Bank)  acknowledges  and  agrees  that its  obligation  to acquire
participations  pursuant  to this  paragraph  in respect of Letters of Credit is
absolute  and  unconditional  and  shall  not be  affected  by any  circumstance
whatsoever,  including  any  amendment,  renewal or  extension  of any Letter of
Credit  or  the  occurrence  and  continuance  of  a  Default  or  reduction  or
termination of the Commitments, and that each such payment shall be made without
any offset,  abatement,  withholding or reduction whatsoever provided,  however,
that no Lender  shall be  obligated  to acquire a  participation  in a Letter of
Credit if, at the time such  Letter of Credit was issued,  the Issuing  Bank had
been notified in writing by a Lender or the Company that an Event of Default had
occurred and was continuing.

      (e)  Reimbursement.  If the Issuing Bank shall make any LC Disbursement in
respect of a Letter of Credit,  the Company shall reimburse such LC Disbursement
by paying to the  Administrative  Agent an amount equal to such LC  Disbursement
not  later  than  2:00  p.m.,  New York  City  time,  on the date  that  such LC
Disbursement  is made,  if the  Company  shall have  received  notice of such LC
Disbursement  prior to 10:00 a.m., New York City time, on such date, or, if such
notice has not been  received  by the  Company  prior to such time on such date,
then not later than 2:00 p.m.,  New York City time, on the Business Day that the
Company  receives such notice,  if such notice is received  prior to 10:00 a.m.,
New York City time, on the day of receipt,  or (ii) the Business Day immediately
following the day that the Company  receives such notice,  if such notice is not
received  prior to such time on the day of receipt;  provided  that,  if such LC
Disbursement  is not  less  than  $500,000,  the  Company  may,  subject  to the
conditions  to borrowing set forth  herein,  request in accordance  with Section
2.03 that such payment be financed with an ABR Borrowing in an equivalent amount
and, to the extent so financed,  the  Company's  obligation to make such payment
shall be discharged and replaced by the resulting ABR Borrowing.  If the Company
fails to make such payment when due, the Administrative  Agent shall notify each
Lender of the applicable LC Disbursement,  the payment then due from the Company
in respect thereof and such Lender's  Applicable  Percentage  thereof.  Promptly
following  receipt of such notice,  each Lender shall pay to the  Administrative
Agent its Applicable Percentage of the payment then due from the Company, in the
same  manner as  provided  in  Section  2.05 with  respect to Loans made by such
Lender  (and  Section  2.05  shall  apply,  mutatis  mutandis,  to  the  payment
obligations of the Lenders),  and the Administrative Agent shall promptly pay to
the  Issuing  Bank the  amounts so  received  by it from the  Lenders.  Promptly
following  receipt by the  Administrative  Agent of any payment from the Company
pursuant to this  paragraph,  the  Administrative  Agent shall  distribute  such
payment to the Issuing Bank or, to the extent that  Lenders  have made  payments
pursuant to this  paragraph to reimburse the Issuing Bank,  then to such Lenders
and the Issuing Bank as their interests may appear. Any payment made by a Lender
pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement
(other than the funding of ABR Loans as contemplated above) shall not constitute
a Loan and shall not relieve the Company of its  obligation to reimburse such LC
Disbursement.

      (f)  Obligations  Absolute.  The  Company's  obligation  to  reimburse  LC
Disbursements  as provided in paragraph  (e) of this Section  shall be absolute,
unconditional  and  irrevocable,  and shall be performed  strictly in accordance
with the terms of this Agreement under any and all circumstances  whatsoever and
irrespective of any lack of validity or  enforceability  of any Letter of Credit
or this  Agreement,  or any term or provision  therein,  (ii) any draft or other
document presented under a Letter of Credit proving to be forged,  fraudulent or
invalid in any respect or any  statement  therein  being untrue or inaccurate in
any respect,  (iii) payment by the Issuing Bank under a Letter of Credit against
presentation of a draft or other document that does not comply strictly with the
terms of such  Letter  of  Credit,  or (iv)  any  other  event  or  circumstance
whatsoever,  whether or not similar to any of the foregoing, that might, but for
the provisions of this Section, constitute a legal or equitable discharge of the
Company's obligations  hereunder.  Neither the Administrative Agent, the Lenders
nor the Issuing Bank, nor any of their Related Parties, shall have any liability
or responsibility by reason of or in connection with the issuance or transfer of
any Letter of Credit or any  payment or failure to make any  payment  thereunder
(irrespective  of  any  of  the  circumstances  referred  to  in  the  preceding
sentence), or any error, omission,  interruption,  loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation  of technical terms or any consequence  arising from
causes beyond the control of the Issuing Bank; provided that the foregoing shall
not be construed to excuse the Issuing Bank from liability to the Company to the
extent of any direct  damages (as opposed to  consequential  damages,  claims in
respect of which are hereby  waived by the  Company to the extent  permitted  by
applicable  law)  suffered by the Company that are caused by the Issuing  Bank's
failure to exercise the standard of care agreed  hereunder  (as set forth in the
next  sentence)  to be  applicable  when  determining  whether  drafts and other
documents presented under a Letter of Credit comply with the terms thereof.  The
parties  hereto  expressly  agree that the Issuing  Bank shall be deemed to have
exercised  the agreed  standard  of care in the absence of gross  negligence  or
wilful  misconduct  on the part of the  Issuing  Bank when  determining  whether
drafts and other  documents  presented  under a Letter of Credit comply with the
terms  thereof,  and shall be  deemed to have  failed  to  exercise  the  agreed
standard  of care only if it shall have  engaged in gross  negligence  or wilful
misconduct when making such  determination.  In furtherance of the foregoing and
without limiting the generality  thereof, it is understood that the Issuing Bank
may accept  documents that appear on their face to be in substantial  compliance
with  the  terms  of a Letter  of  Credit  without  responsibility  for  further
investigation,  regardless of any notice or information to the contrary, and may
make payment upon  presentation  of documents that appear on their face to be in
substantial  compliance with the terms of such Letter of Credit;  provided that,
notwithstanding  the  foregoing,  the Issuing Bank shall have the right,  in its
sole discretion, to decline to accept such documents and to make such payment if
such  documents  are not in strict  compliance  with the terms of such Letter of
Credit.

      (g) Disbursement  Procedures.  The Issuing Bank shall,  promptly following
its receipt thereof,  examine all documents purporting to represent a demand for
payment  under a Letter of Credit.  The Issuing Bank shall  promptly  notify the
Administrative  Agent and the Company by  telephone  (confirmed  by telecopy) of
such demand for payment and whether the Issuing Bank has made or will make an LC
Disbursement  thereunder;  provided  that any failure to give or delay in giving
such notice shall not relieve the Company of its  obligation  to  reimburse  the
Issuing Bank and the Lenders with respect to any such LC Disbursement.

      (h) Interim Interest.  If the Issuing Bank shall make any LC Disbursement,
then,  unless the Company shall  reimburse such LC  Disbursement  in full on the
date  such LC  Disbursement  is made,  the  unpaid  amount  thereof  shall  bear
interest,  for each day from and including the date such LC Disbursement is made
to but excluding the date that the Company reimburses such Disbursement,  at the
rate per annum then applicable to ABR Loans; provided that, if the Company fails
to reimburse  such LC  Disbursement  when due pursuant to paragraph  (e) of this
Section,  then Section 2.11(c) shall apply.  Interest  accrued  pursuant to this
paragraph  shall be for the account of the Issuing  Bank,  except that  interest
accrued on and after the date of payment by any Lender pursuant to paragraph (e)
of this Section to  reimburse  the Issuing Bank shall be for the account of such
Lender to the extent of such payment.

      (i)  Replacement  of the Issuing Bank. The Issuing Bank may be replaced at
any time by written agreement among the Company,  the Administrative  Agent, the
replaced Issuing Bank and the successor Issuing Bank, provided that the identity
of any  successor  Issuing Bank shall be subject to the approval of the Required
Lenders.  The  Administrative  Agent shall  notify the  Lenders of any  proposed
replacement of the Issuing Bank. At the time any such  replacement  shall become
effective,  the Company shall pay all unpaid fees accrued for the account of the
replaced Issuing Bank pursuant to Section 2.12(b).  From and after the effective
date of any such replacement,  (i) the successor Issuing Bank shall have all the
rights and  obligations of the Issuing Bank under this Agreement with respect to
Letters of Credit to be issued thereafter and (ii) references herein to the term
"Issuing  Bank" shall be deemed to refer to such  successor  or to any  previous
Issuing  Bank,  or to such  successor  and all previous  Issuing  Banks,  as the
context shall require.  After the replacement of an Issuing Bank hereunder,  the
replaced Issuing Bank shall remain a party hereto and shall continue to have all
the rights and  obligations of an Issuing Bank under this Agreement with respect
to Letters of Credit  issued by it prior to such  replacement,.but  shall not be
required to issue additional Letters of Credit.

      (j) Cash  Collateralization.  If any Event of Default  shall  occur and be
continuing,  on the  Business  Day that the  Company  receives  notice  from the
Administrative  Agent or the Required  Lenders (or, if the maturity of the Loans
has been accelerated,  Lenders with LC Exposure representing greater than 51% of
the total LC Exposure) demanding the deposit of cash collateral pursuant to this
paragraph,  the  Company  shall  deposit in an account  with the  Administrative
Agent,  in the  name of the  Administrative  Agent  and for the  benefit  of the
Lenders,  an amount in cash  equal to the LC  Exposure  as of such date plus any
accrued and unpaid  interest  thereon;  provided that the  obligation to deposit
such cash collateral shall become effective immediately,  and such deposit shall
become immediately due and payable,  without demand or other notice of any kind,
upon the  occurrence  of any  Event  of  Default  with  respect  to the  Company
described in clause (h) or W of Article VIII.  Such deposit shall be held by the
Administrative  Agent as  collateral  for the  payment  and  performance  of the
obligations of the Company under this Agreement.  The Administrative Agent shall
have  exclusive   dominion  and  control,   including  the  exclusive  right  of
withdrawal,  over such account. Other than any interest earned on the investment
of such  deposits,  which  investments  shall  be made at the  option  and  sole
discretion of the  Administrative  Agent and at the Company's  risk and expense,
such  deposits  shall not bear  interest.  Interest or profits,  if any, on such
investments  shall  accumulate in such account.  Moneys in such account shall be
applied  by the  Administrative  Agent  to  reimburse  the  Issuing  Bank for LC
Disbursements  for which it has not been  reimbursed  and,  to the extent not so
applied, shall be held for the satisfaction of the reimbursement  obligations of
the Company  for the LC  Exposure at such time or, if the  maturity of the Loans
has been  accelerated  (but  subject to the consent of Lenders  with LC Exposure
representing  greater than 51% of the total LC Exposure),  be applied to satisfy
other  obligations  of the  Company  under  this  Agreement.  If the  Company is
required to provide an amount of cash  collateral  hereunder  as a result of the
occurrence  of an Event of  Default,  the  Administrative  Agent  shall,  at the
request of the  Company,  release  moneys in such  account to the Company to the
extent the balance in such  account  exceeds  the LC Exposure at such time.  Any
amount that is not applied or  released  as  aforesaid  shall be returned to the
Company  within three  Business Days after all Events of Default have been cured
or waived.

 .     SECTION 2.05. Funding of BorrowingsSECTION 2.05. Funding of Borrowings

      (a) Each  Lender  shall make each Loan to be made by it  hereunder  on the
proposed date thereof by wire transfer of  immediately  available  funds by 1:00
p.m.,  New York City  time,  to the  account  of the  Administrative  Agent most
recently  designated  by it for such  purpose  by  notice  to the  Lenders.  The
Administrative  Agent will make such Loans available to the relevant Borrower by
promptly crediting the amounts so received, in like funds, to the account of the
Company or the Subsidiary  Borrower specified by the Company pursuant to Section
2.03;  provided  that ABR  Loans  made to  finance  the  reimbursement  of an LC
Disbursement   as  provided  in  Section   2.04(e)  shall  be  remitted  by  the
Administrative Agent to the Issuing Bank.

      (b) Unless the  Administrative  Agent  shall have  received  notice from a
Lender prior to the  proposed  date of any  Borrowing  that such Lender will not
make  available  to  the  Administrative  Agent  such  Lender's  share  of  such
Borrowing,  the  Administrative  Agent may assume that such Lender has made such
share  available on such date in accordance  with  paragraph (a) of this Section
and may,  in reliance  upon such  assumption,  make  available  to the  relevant
Borrower a corresponding amount. In such event, if a Lender has not in fact made
its share of the applicable  Borrowing  available to the  Administrative  Agent,
then the  applicable  Lender  and such  Borrower  severally  agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon,  for each day from and including the date such amount is made available
to such  Borrower  to but  excluding  the date of payment to the  Administrative
Agent, at W in the case of such Lender, the Federal Funds Effective Rate or (ii)
in the case of such Borrower,  the interest rate applicable to the Loans made on
the  occasion  of such  Borrowing.  If  such  Lender  pays  such  amount  to the
Administrative  Agent,  then such amount shall  constitute  such  Lender's  Loan
included in such Borrowing.

 .ECTION 2.06. Interest ElectionsSECTION 2.06. Interest Elections

      (a)  Each  Borrowing  initially  shall  be of the  Type  specified  in the
applicable Borrowing Request and, in the case of a Eurodollar  Borrowing,  shall
have  an  initial  Interest  Period  as  specified  in such  Borrowing  Request.
Thereafter,  the Company may elect to convert such Borrowing to a different Type
or to continue such  Borrowing and, in the case of a Eurodollar  Borrowing,  may
elect Interest Periods  therefor,  all as provided in this Section.  The Company
may elect different  options with respect to different  portions of the affected
Borrowing,  in which case each such portion shall be allocated ratably among the
Lenders  and the  Loans  comprising  each such  portion  shall be  considered  a
separate Borrowing,  provided that each such Eurodollar Borrowing shall be in an
aggregate  amount  that is an integral  multiple  of $100,000  and not less than
$2,000,000.  In the  event  that the  Company,  on the  same  day,  converts  or
continues all or any portion of two or more ABR or Eurodollar Borrowings into or
as Eurodollar  Borrowings with Interest Periods of equal duration,  the portions
of such Eurodollar Borrowings having Interest Periods of equal duration shall be
deemed to constitute a single Eurodollar Borrowing for purposes hereof.

      (b) To make an election pursuant to this Section, the Company shall notify
the  Administrative  Agent of such  election  by  telephone  by the time  that a
Borrowing  Request  would be required  under  Section  2.03 if the Company  were
requesting a Borrowing of the Type  resulting  from such  election to be made on
the effective  date of such election.  Each such  telephonic  Interest  Election
Request shall be irrevocable and shall be confirmed promptly by hand delivery or
telecopy to the Administrative Agent of a written Interest Election Request in a
form approved by the Administrative Agent and signed by the Company.

      (c) Each telephonic and written  Interest  Election  Request shall specify
the following information in compliance with Section 2.02:

      (i) the Borrowing to which such Interest  Election Request applies and, if
      different  options are being  elected with  respect to different  portions
      thereof,  the portions thereof to be allocated to each resulting Borrowing
      (in which case the  information to be specified  pursuant to clauses (iii)
      and (iv) below shall be specified for each resulting Borrowing);

      (ii) the  effective  date of the election  made  pursuant to such Interest
      Election Request, which shall be a Business Day;

      (iii)whether the resulting Borrowing is to be an ABR Borrowing or a 
      Eurodollar Borrowing; and

      (iv) if the resulting  Borrowing is a Eurodollar  Borrowing,  the Interest
      Period to be  applicable  thereto  after giving  effect to such  election,
      which  shall  be a  period  contemplated  by the  definition  of the  term
      "Interest Period".

      If any such Interest Election Request requests a Eurodollar  Borrowing but
does not specify an Interest  Period,  then the Company  shall be deemed to have
selected an Interest Period of one month's duration.

      (d)  Promptly  following  receipt of an  Interest  Election  Request,  the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender's portion of each resulting Borrowing.

      (e) If the Company  fails to deliver a timely  Interest  Election  Request
with respect to a Eurodollar  Borrowing  prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such  Interest  Period such  Borrowing  shall be  converted to an ABR
Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default
has occurred and is continuing and the  Administrative  Agent, at the request of
the Required  Lenders,  so notifies the  Company,  then,  so long as an Event of
Default  is  continuing  W no  outstanding  Borrowing  may  be  converted  to or
continued as a Eurodollar  Borrowing  and (ii) unless  repaid,  each  Eurodollar
Borrowing  shall be  converted  to an ABR  Borrowing  at the end of the Interest
Period applicable thereto.

SECTION 2.07. Termination, Reduction and Extension of CommitmentsSECTION 2.07.
 .     Termination, Reduction and Extension of Commitments

      (a) Unless previously terminated, the Commitments shall terminate on the 
      Maturity Date.

      (b) The Company may at any time  terminate,  or from time to time  reduce,
the Commitments;  provided that W each reduction of the Commitments  shall be in
an amount that is an integral  multiple of $100,000  and not less than  $500,000
and (ii) the Company  shall not  terminate or reduce the  Commitments  if, after
giving  effect to any  concurrent  prepayment  of the Loans in  accordance  with
Section 2.09, the sum of the Revolving  Credit  Exposures would exceed the total
Commitments.

      (c) The Company shall notify the  Administrative  Agent of any election to
terminate or reduce the Commitments under paragraph (b) of this Section at least
three  Business  Days  prior  to the  effective  date  of  such  termination  or
reduction,  specifying  such election and the effective  date thereof.  Promptly
following  receipt of any notice,  the  Administrative  Agent  shall  advise the
Lenders of the contents  thereof.  Each notice delivered by the Company pursuant
to this Section shall be  irrevocable;  provided that a notice of termination of
the  Commitments  delivered  by the  Company  may  state  that  such  notice  is
conditioned  upon the  effectiveness  of other  credit  facilities  or any other
transaction  specified in such notice,  in which case such notice may be revoked
by the  Company  (by  notice  to the  Administrative  Agent  on or  prior to the
specified effective date) if such condition is not satisfied. Any termination or
reduction  of  the  Commitments  shall  be  permanent.  Each  reduction  of  the
Commitments  shall be made ratably  among the Lenders in  accordance  with their
respective Commitments.

      (d) The Company  may, by notice to the  Administrative  Agent (which shall
promptly  notify  the  Lenders)  not less  than 60 days and not more the 90 days
prior to March 31st of any year (the "Applicable Extension Date"),  request that
the Lenders extend the Maturity Date then in effect hereunder (the "Existince of
Maturity  Date")  for a period  of one year  from the  Existing  Maturity  Date;
provided  that the  Company  may request  only two  extensions  pursuant to this
Section 2.07(d). Each Lender, acting in its sole discretion, shall, by notice to
the  Administrative  Agent (which shall notify the Company) given not later than
the date which is 30 days prior to the  Applicable  Extension Date (the "Consent
Date), advise the Administrative Agent whether or not such Lender agrees to such
extension;  provided that each Lender that determines not to extend the Maturity
Date (a  "Non-extendinq  Lender") shall notify the  Administrative  Agent (which
shall notify the other Lenders and the Company) of such fact promptly after such
determination  (but in any event no later than the Consent  Date) and any Lender
that does not advise the  Administrative  Agent on or before  the  Consent  Date
shall be deemed to be a  Non-extending  Lender.  The  election  of any Lender to
agree to such extension shall not obligate any other Lender to so agree.

      (ii) The Company shall have the right,  at any time after the Consent Date
and on or before the  Applicable  Extension  Date to replace  any  Non-extending
Lender with,  and  otherwise  add to this  Agreement,  one or more other Persons
(which may include increasing the Commitment of any Lender) (each an "Additional
Commitment  Lender"),  with the  approval  of the  Administrative  Agent  (which
approval  shall  not  be  unreasonably  withheld),   each  of  which  Additional
Commitment  Lenders  shall have entered into an agreement in form and  substance
satisfactory to the Company and the Administrative  Agent pursuant to which such
Additional  Commitment  Lender shall,  effective as of the Applicable  Extension
Date (but only if the  requisite  Lenders  shall have  consented to the relevant
extension  under clause (iii) below),  undertake a Commitment  (and, if any such
Additional  Commitment  Lender is already a Lender,  its Commitment  shall be in
addition to such Lender's Commitment  hereunder on such date),  provided that in
no event shall the aggregate amount of Commitments in effect  immediately  prior
to the request of an  extension  pursuant to this  Section  2.07(d) be increased
pursuant to this Section 2.07(d).

      (iii)If  (and only if) the total of the  Commitments  of the Lenders  that
have agreed under  clause (ii) above so to extend the Maturity  Date shall be at
least 80% of the aggregate amount of the Commitments in effect immediately prior
to the Consent Date,  then,  effective as of the Applicable  Extension Date, the
Existing  Maturity Date shall be extended by one year (except that, if such date
is not a Business Day, such Existing  Maturity Date as so extended  shall be the
next  preceding  Business  Day)  and each  Additional  Commitment  Lender  shall
thereupon become a "Lender" for all purposes of this Agreement.

      Notwithstanding the foregoing, the extension of the Existing Maturity Date
shall not be effective with respect to any Lender unless:

      (A) no Default  shall have occurred and be continuing on and as of each of
      the  date of the  notice  requesting  such  extension  and the  Applicable
      Extension Date;

      (B) each of the  representations and warranties made by the Credit Parties
      in this  Agreement  and the  other  Credit  Documents  shall  be true  and
      complete  on and as of each  of the  date of the  notice  requesting  such
      extension and the Applicable Extension Date with the same force and effect
      as if made on and as of such  date  (or,  if any  such  representation  or
      warranty is expressly  stated to have been made as of a specific  date, as
      of such specific date); and

      (C)  each  Non-extending  Lender  shall  have  been  paid  in  full by the
      Borrowers  all  amounts  owing to such Lender  hereunder  on or before the
      Applicable Extension Date.

Even if the Existing  Maturity Date is extended as aforesaid,  the Commitment of
each Non-extending  Lender shall terminate on the Applicable  Extension Date and
each Lender other than a Nonextending  Lender shall,  on such date, be deemed to
acquire  its pro rata share of any  participations  in Letters of Credit held by
each Non-extending Lender on such date.

SECTION 2.08. Repayment of Loans; Evidence of DebtSECTION 2.08. Repayment of 
Loans; evidence of Debt

      (a)  Each  Borrower  hereby   unconditionally   promises  to  pay  to  the
Administrative  Agent for the account of each  Lender the then unpaid  principal
amount of each Loan made to such Borrower on the Maturity Date.

      (b) Each Lender shall  maintain in accordance  with its usual  practice an
account or accounts  evidencing the indebtedness of each Borrower to such Lender
resulting  from each Loan made by such Lender to such  Borrower,  including  the
amounts of principal  and interest  payable and paid to such Lender from time to
time hereunder.

      (c) The  Administrative  Agent shall  maintain  accounts in which it shall
record W the  amount of each  Loan  made  hereunder,  the Type  thereof  and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the relevant  Borrower to each
Lender hereunder and (iii) the amount of any sum received by the  Administrative
Agent hereunder for the account of the Lenders and each Lender's share thereof.

      (d) The entries made in the accounts  maintained pursuant to paragraph (b)
or (c) of this  Section  shall be prima  facie  evidence  of the  existence  and
amounts of the obligations  recorded  therein;  provided that the failure of any
Lender  or the  Administrative  Agent to  maintain  such  accounts  or any error
therein shall not in any manner affect the  obligation of the Borrowers to repay
the Loans in accordance with the terms of this Agreement.

      (e) Any  Lender  may  request  that  Loans  made by it be  evidenced  by a
promissory note. In such event,  the Company shall prepare,  execute and deliver
to such  Lender a  promissory  note  payable to the order of such Lender (or, if
requested by such Lender,  to such Lender and its registered  assigns) in a form
approved by the Administrative  Agent.  Thereafter,  the Loans evidenced by such
promissory  note and  interest  thereon  shall  at all  times  (including  after
assignment  pursuant to Section 10.04) be represented by one or more  promissory
notes  (payable to the order of each Lender  holding a portion of such Loans or,
if such promissory note is a registered  note, to such Lender and its registered
assigns).

 .ECTION 2.09. Prepayment of LoansSECTION 2.09. Prepayment of Loans

      (a) The  Borrowers  shall have the right at any time and from time to time
to  prepay  any  Borrowing  in whole  or in part,  subject  to prior  notice  in
accordance with paragraph (b) of this Section without premium or penalty (except
to the extent provided in Section 2.14).

      (b) The  Company  shall  notify  the  Administrative  Agent  by  telephone
(confirmed  by  telecopy)  of  any  prepayment  hereunder  (i) in  the  case  of
prepayment of a Eurodollar  Borrowing,  not later than 1:00 p.m.,  New York City
time,  three Business Days before the date of repayment,  or (ii) in the case of
prepayment of an ABR  Borrowing,  not later than 11:00 a.m., New York City time,
on the date of  prepayment.  Each such  notice  shall be  irrevocable  and shall
specify  the  prepayment  date and the  principal  amount of each  Borrowing  or
portion thereof to be prepaid; provided that, if a notice of prepayment is given
in connection  with a conditional  notice of termination  of the  Commitments as
contemplated  by Section 2.07,  then such notice of prepayment may be revoked if
such notice of termination is revoked in accordance with Section 2.07.  Promptly
following receipt of any such notice relating to a Borrowing, the Administrative
Agent shall advise the Lenders of the contents thereof.  Each partial prepayment
of any Borrowing shall be in an amount that would be permitted in the case of an
advance  of a  Borrowing  of the same Type as  provided  in Section  2.02.  Each
prepayment of a Borrowing  shall be applied ratably to the Loans included in the
prepaid  Borrowing.  Prepayments shall be accompanied by accrued interest to the
extent required by Section 2.11.

 .ECTION 2.10. FeesSECTION 2.10. Fees

      (a) The Company agrees to pay to the Administrative  Agent for the account
of each Lender a facility fee, which shall accrue at the Applicable  Rate on the
daily amount of the  Commitment of such Lender  (whether used or unused)  during
the period from and including  the  Effective  Date to but excluding the date on
which such  Commitment  terminates;  provided that, if such Lender  continues to
have any Revolving  Credit Exposure after its Commitment  terminates,  then such
facility  fee shall  continue  to accrue  on the daily  amount of such  Lender's
Revolving  Credit  Exposure from and including the date on which its  Commitment
terminates  to but  excluding  the date on which such Lender  ceases to have any
Revolving Credit Exposure.  Accrued facility fees shall be payable in arrears on
the last day of March, June, September and December of each year and on the date
on which the Commitments  terminate,  commencing on the first such date to occur
after the date hereof;  provided that any facility fees accruing  after the date
on which the Commitments terminate shall be payable on demand. All facility fees
shall be  computed  on the basis of a year of 360 days and shall be payable  for
the actual  number of days elapsed  (including  the first day but  excluding the
last day).

      (b) The Company agrees to pay to the Administrative  Agent for the account
of each Lender a participation fee with respect to its participations in Letters
of Credit,  which shall accrue at the  Applicable  Rate which is  applicable  to
Eurodollar  Loans on the  average  daily  amount of such  Lender's  LC  Exposure
(excluding any portion thereof  attributable  to unreimbursed LC  Disbursements)
during the period from and  including  the  Effective  Date to but excluding the
later of the date on which such Lender's  Commitment  terminates and the date on
which such Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a
fronting fee, which shall accrue at the rate of 0.0625% per annum on the average
daily amount of the LC Exposure  (excluding any portion thereof  attributable to
unreimbursed  LC  Disbursements)  during  the  period  from  and  including  the
Effective  Date to but  excluding  the later of the date of  termination  of the
Commitments and the date on which there ceases to be any LC Exposure, as well as
the  Issuing  Bank's  standard  fees with  respect to the  issuance,  amendment,
renewal  or  extension  of any  Letter  of  Credit  or  processing  of  drawings
thereunder.  Participation  fees and fronting fees accrued through and including
the last day of March,  June,  September  and  December  of each  year  shall be
payable on the third  Business Day  following  such last day,  commencing on the
first such date to occur after the Effective  Date;  provided that all such fees
shall be payable  on the date on which the  Commitments  terminate  and any such
fees accruing after the date on which the Commitments terminate shall be payable
on demand. Any other fees payable to the Issuing Bank pursuant to this paragraph
shall be  payable  within  10 days  after  demand.  All  participation  fees and
fronting  fees shall be computed on the basis of a year of 360 days and shall be
payable  for the  actual  number of days  elapsed  (including  the first day but
excluding the last day).

      (c) The Company  agrees to pay to the  Administrative  Agent,  for its own
account,  fees  payable in the amounts and at the times  separately  agreed upon
between the Company and the Administrative Agent.

      (d)  All  fees  payable  hereunder  shall  be paid on the  dates  due,  in
immediately  available funds, to the Administrative  Agent for distribution,  in
the case of facility fees and participation fees, to the Lenders or, in the case
of fronting fees, to the Issuing Bank.  Fees paid shall not be refundable  under
any circumstances.

 .ECTION 2.11. InterestSECTION 2.11. Interest

      (a) The Loans  comprising each ABR Borrowing shall bear interest at a rate
per  annum  equal  to the sum of (i) the  Alternate  Base  Rate  plus  (ii)  the
Applicable Rate.

      (b) The Loans comprising each Eurodollar  Borrowing shall bear interest at
a rate per annum equal to the sum of (i) the Adjusted LIBO Rate for the Interest
Period in effect for such Borrowing plus (ii) the Applicable Rate.

      (c) Notwithstanding the foregoing,  if any principal of or interest on any
Loan or any fee or other amount  payable by the Borrowers  hereunder is not paid
when due,  whether at stated  maturity,  upon  acceleration  or otherwise,  such
overdue amount shall bear interest,  after as well as before judgment, at a rate
per annum equal to in the case of overdue  principal of any Loan,  plus the rate
otherwise  applicable to such Loan as provided  above or (ii) in the case of any
other amount, plus the rate applicable to AER Loans as provided above.

      (d)  Accrued  interest  on each Loan  shall be  payable in arrears on each
Interest Payment Date for such Loan;  Provided that interest accrued pursuant to
paragraph (c) of this Section  shall be payable on demand,  (ii) in the event of
any  repayment or prepayment of any Loan (other than a prepayment of an ABR Loan
prior to the end of the Availability Period),  accrued interest on the principal
amount  repaid or  prepaid  shall be payable  on the date of such  repayment  or
prepayment, (iii) in the event of any conversion of any Eurodollar Loan prior to
the end of the current Interest Period  therefor,  accrued interest on such Loan
shall be payable on the effective  date of such  conversion and (iv) all accrued
interest shall be payable upon termination of the Commitments.

      (e) All interest hereunder shall be computed on the basis of a year of 360
days,  except that interest  computed by reference to the Alternate Base Rate at
times when the Alternate  Base Rate is based on the Prime Rate shall be computed
on the  basis of a year of 365 days  (or 366 days in a leap  year),  and in each
case shall be payable for the actual number of days elapsed (including the first
day but excluding the last day).  The applicable  Alternate Base Rate,  Adjusted
LIBO Rate or LIBO Rate shall be determined by the Administrative Agent, and such
determination shall be conclusive absent manifest error.

 . If  prior  to  the  commencement  of  any  Interest  Period  for a  Eurodollar
Borrowing:rest

      (a) the  Administrative  Agent determines  (which  determination  shall be
conclusive  absent  manifest  error) that adequate and  reasonable  means do not
exist for  ascertaining  the Adjusted LIBO Rate or the LIBO Rate, as applicable,
for such Interest Period; or

      (b) the  Administrative  Agent is advised by the Required Lenders that the
Adjusted LIBO Rate or the LIBO Rate,  as  applicable,  for such Interest  Period
will not  adequately  and fairly reflect the cost to such Lenders (or Lender) of
making or  maintaining  their Loans (or its Loan) included in such Borrowing for
such Interest Period;

then the  Administrative  Agent shall give notice thereof to the Company and the
Lenders by  telephone  or telecopy as promptly as  practicable  thereafter  and,
until the  Administrative  Agent  notifies  the Company and the Lenders that the
circumstances  giving  rise to such  notice no longer  exist,  (i) any  Interest
Election   Request  that  requests  the  conversion  of  any  Borrowing  to,  or
continuation  of any Borrowing as, a Eurodollar  Borrowing shall be ineffective,
(ii) if any Borrowing  Request requests a Eurodollar  Borrowing,  such Borrowing
shall be made as an ABR Borrowing.

 .ECTION 2.13. Increased CostsSECTION 2.13. Increased Costs

           (a)  If any Change in Law shall:

           (i) impose, modify or deem applicable any reserve, special deposit or
      similar  requirement  against assets of,  deposits with or for the account
      of, or credit extended by, any Lender (except any such reserve requirement
      reflected in the Adjusted LIBO Rate); or

      (ii)  impose on any Lender or the  Issuing  Bank or the  London  interbank
      market any other  condition  affecting this Agreement or Eurodollar  Loans
      made by such Lender or any Letter of Credit or any participation therein;

and the result of any of the  foregoing  shall be to  increase  the cost to such
Lenders of making or  maintaining  any Eurodollar  Loan (or of  maintaining  its
obligation  to make any such Loan) or to increase the cost to such Lender or the
Issuing Bank of participating in, issuing or maintaining any Letter of Credit or
to reduce the amount of any sum  received  or  receivable  by such Lender or the
Issuing Bank hereunder (whether of principal,  interest or otherwise),  then the
Company will pay to the  Administrative  Agent for the account of such Lender or
the  Issuing  Bank such  additional  amount or amounts as will  compensate  such
Lender  or the  Issuing  Bank,  as the case may be,  for such  additional  costs
incurred or reduction suffered.

      (b) If any Lender or the Issuing  Bank  determines  that any Change in Law
regarding capital requirements has or would have the effect of reducing the rate
of return on such  Lender's or the Issuing  Bank's  capital or on the capital of
such Lender's or the Issuing Bank's holding company, if any, as a consequence of
this Agreement or the Loans made by, or  participations in the Letters of Credit
held by, such Lender,  or the Letters of Credit issued by the Issuing Bank, to a
level below that which such Lender or the Issuing  Bank or such  Lender's or the
Issuing  Bank's  holding  company could have achieved but for such Change in Law
(taking into  consideration such Lender's or the Issuing Bank's policies and the
policies of such Lender's or the Issuing Bank's holding  company with respect to
capital  adequacy),  then  from  time  to  time  the  Company  will  pay  to the
Administrative  Agent for the account of such Lender or the Issuing Bank, as the
case may be, such additional amount or amounts as will compensate such Lender or
the Issuing Bank or such Lender's or the Issuing Bank's holding  company for any
such reduction suffered.

      (c) A certificate of a Lender or the Issuing Bank setting forth the amount
or amounts  necessary to  compensate  such Lender or its holding  company or the
Issuing  Bank or its  holding  company,  as the case  may be,  as  specified  in
paragraph  (a) or (b) of this Section  shall be delivered to the Company (with a
copy to the Administrative Agent) and shall be conclusive absent manifest error.
The Company shall pay the Administrative Agent for the account of such Lender or
the  Issuing  Bank,  as the case  may be,  the  amount  shown as due on any such
certificate within 10 days after receipt thereof.

      (d)  Failure  or delay on the part of any  Lender or the  Issuing  Bank to
demand  compensation  pursuant to this Section shall not  constitute a waiver of
such Lender's or the Issuing Bank's right to demand such compensation;  provided
that the Company  shall not be required  to  compensate  a Lender or the Issuing
Bank  pursuant to this Section for any increased  costs or  reductions  incurred
more than six months prior to the date that such Lender or the Issuing  Bank, as
the case may be,  notifies  the Company of the Change in Law giving rise to such
increased  costs  or  reductions  and of such  Lender's  or the  Issuing  Bank's
intention to claim compensation  therefor;  provided further that, if the Change
in Law giving rise to such increased  costs or reductions is  retroactive,  then
the six-month  period  referred to above shall be extended to include the period
of retroactive effect thereof.

 . In the event of (a) the payment of any principal of any Eurodollar  Loan prior
to the last day of an Interest Period applicable  thereto (including as a result
of an Event of Default),  (b) the conversion of any Eurodollar Loan prior to the
last day of the Interest Period applicable  thereto,  (c) the failure to borrow,
convert,  continue  or  prepay  any Loan on the  date  specified  in any  notice
delivered  pursuant hereto (regardless of whether such notice is permitted to be
revocable under Section 2.09(b) and is revoked in accordance  herewith),  or (d)
the assignment of any Eurodollar Loan other than on the last day of the Interest
Period  applicable  thereto as a result of a request by the Company  pursuant to
Section 2.17,  then, in any such event, the Company shall compensate each Lender
for the loss,  cost and  expense  attributable  to such  event.  The loss to any
Lender  attributable  to any such event  shall be an amount  determined  by such
Lender to be equal to the excess,  if any, of W the amount of interest that such
Lender would pay for a deposit  equal to the  principal  amount of such Loan for
the period from the date of such payment,  conversion,  failure or assignment to
the last day of the then current  Interest Period for such Loan (or, in the case
of a failure to borrow, convert or continue, the duration of the Interest Period
that would have resulted from such borrowing, conversion or continuation) if the
interest  rate payable on such deposit were equal to the Adjusted  LIBO Rate for
such  Interest  Period,  over (ii) the amount of interest that such Lender would
earn on such principal amount for such period if such Lender were to invest such
principal  amount for such period at the interest rate that would be bid by such
Lender (or an affiliate of such Lender) for dollar  deposits from other banks in
the eurodollar  market at the  commencement of such period. A certificate of any
Lender  setting  forth any amount or amounts  that such  Lender is  entitled  to
receive  pursuant to this Section shall be delivered to the Company and shall be
conclusive  absent manifest error.  The Company shall pay such Lender the amount
shown as due on any such certificate within 10 days after receipt thereof.

 .ECTION 2.15. TaxesSECTION 2.15. Taxes

      (a) Any and all payments by or an account of any  obligation of the Credit
Parties  hereunder shall be made free and clear of and without deduction for any
Indemnified  Taxes or Other  Taxes;  provided  that if any Credit Party shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
the sum  payable  shall be  increased  as  necessary  so that  after  making all
required deductions  (including deductions applicable to additional sums payable
under this  Section) the  Administrative  Agent,  Lender or Issuing Bank (as the
case may be) receives an amount  equal to the sum it would have  received had no
such  deductions  been made,  (ii) the  relevant  Credit  Party  shall make such
deductions and (iii) such Credit Party shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.

      (b)  The  Credit  Parties  shall  pay  any  Other  Taxes  to the  relevant
Governmental Authority in accordance with applicable law.

      (c) The Company shall indemnify the Administrative  Agent, each Lender and
the Issuing Bank (by payment to the Administrative Agent for the account of such
Lender),  within  10 days  after  written  demand  therefor  (with a copy to the
Administrative  Agent),  for the full amount of any  Indemnified  Taxes or Other
Taxes  (including  Indemnified  Taxes or Other  Taxes  imposed or asserted on or
attributable to amounts  payable under this Section) paid by the  Administrative
Agent,  such Lender or the Issuing  Bank,  as the case may be,  which any Credit
Party  failed to pay  under  paragraphs  (a) and (b)  above  and any  penalties,
interest and  reasonable  expenses  arising  therefrom or with respect  thereto,
whether or not such  Indemnified  Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant  Governmental  Authority;  provided that the
Company  shall  have  the  right to  contest,  reasonably  and in good  faith to
appropriate  Governmental  Authorities,  whether such Indemnified Taxes or Other
Taxes were  correctly  or legally  asserted  so long as the  Company  shall have
reimbursed to the Administrative  Agent, such Lender or the Issuing Bank (as the
case may be) the amount so paid by the Administrative  Agent, such Lender or the
Issuing  Bank.  A  certificate  as to the amount of such  payment  or  liability
delivered  to  the  Company  by  a  Lender,  by  the  Issuing  Bank  or  by  the
Administrative  Agent on its own behalf or on behalf of a Lender or the  Issuing
Bank, shall be conclusive absent manifest error.

      (d) As soon as practicable after any payment of Indemnified Taxes or Other
Taxes by any Credit Party to a Governmental  Authority,  such Credit Party shall
deliver  to the  Administrative  Agent the  original  or a  certified  copy of a
receipt issued by such Governmental Authority evidencing such payment, a copy of
the return  reporting such payment or other evidence of such payment  reasonably
satisfactory to the Administrative Agent.

      (e) Any Foreign  Lender that is entitled to an exemption from or reduction
of  withholding  tax under the law of the  jurisdiction  in which a Borrower  is
located,  or any treaty to which such  jurisdiction is a party,  with respect to
payments under this  Agreement  shall deliver to the Company (with a copy to the
Administrative  Agent),  at the time or times  prescribed by  applicable  law or
reasonably  requested  by the  Company,  such  properly  completed  and executed
documentation  prescribed by  applicable  law as will permit such payments to be
made without withholding or at a reduced rate.

      SECTION 2.16. Payments Generally; Pro Rata Treatment;
Sharing of Set-offsSECTION 2.16. Payments Generally; Pro Rata Treatment;Sharing
of .etoffs

      (a) Each Credit  Party shall make each  payment  required to be made by it
hereunder  (whether  of  principal,   interest,  fees  or  reimbursement  of  LC
Disbursements,  or of amounts  payable  under  Section  2.13,  2.14 or 2.15,  or
otherwise)  prior to 2:00  p.m.,  New York City time,  on the date when due,  in
immediately  available  funds,  without  set-off or  counterclaim.  Any  amounts
received   after  such  time  on  any  date  may,  in  the   discretion  of  the
Administrative  Agent,  be deemed to have been  received on the next  succeeding
Business Day for purposes of  calculating  interest  thereon.  All such payments
shall be made to the Administrative Agent at its offices at 270 Park Avenue, New
York,  New York.  The  Administrative  Agent shall  distribute any such payments
received by it for the account of any other Person to the appropriate  recipient
promptly  following receipt thereof.  If any payment hereunder shall be due on a
day that is not a Business  Day,  the date for payment  shall be extended to the
next succeeding Business Day, and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All payments
hereunder shall be made in dollars.

      (b) If at any time insufficient funds are received by and available to the
Administrative  Agent to pay fully all  amounts of  principal,  unreimbursed  LC
Disbursements, interest and fees then due hereunder, such funds shall be applied
W first, to pay interest and fees then due hereunder,  ratably among the parties
entitled thereto in accordance with the amounts of interest and fees then due to
such  parties,   and  (ii)  second,   to  pay  principal  and   unreimbursed  LC
Disbursements then due hereunder,  ratably among the parties entitled thereto in
accordance with the amounts of principal and unreimbursed LC Disbursements  then
due to such parties.

      (c)  If  any  Lender  shall,   by  exercising  any  right  of  set-off  or
counterclaim  or  otherwise,  obtain  payment in respect of any  principal of or
interest on any of its Loans or participations in LC Disbursements  resulting in
such Lender receiving payment of a greater proportion of the aggregate amount of
its Loans and  participations  in LC Disbursements  and accrued interest thereon
than the proportion received by any other Lender, then the Lender receiving such
greater proportion shall purchase (for cash at face value) participations in the
Loans and  participations  in LC  Disbursements  of other  Lenders to the extent
necessary  so that the  benefit  of all such  payments  shall be  shared  by the
Lenders  ratably in  accordance  with the  aggregate  amount of principal of and
accrued   interest  on  their  respective   Loans  and   participations   in  LC
Disbursements;  Provided that W if any such participations are purchased and all
or  any  portion  of  the  payment  giving  rise  thereto  is  recovered,   such
participations  shall be rescinded and the purchase price restored to the extent
of such recovery,  without  interest,  and (ii) the provisions of this paragraph
shall  not be  construed  to apply to any  payment  made by the  Credit  Parties
pursuant to and in accordance  with the express  terms of this  Agreement or any
payment obtained by a Lender as consideration for the assignment of or sale of a
participation in any of its Loans or  participations  in LC Disbursements to any
assignee or  participant,  other than to the Credit Parties or any Subsidiary or
Affiliate  thereof (as to which the provisions of this  paragraph  shall apply).
The Credit  Parties  consent to the  foregoing  and agree,  to the extent it may
effectively  do  so  under   applicable   law,  that  any  Lender   acquiring  a
participation  pursuant to the foregoing  arrangements  may exercise against the
Credit  Parties  rights  of  set-off  and  counterclaim  with  respect  to  such
participation  as fully as if such Lender  were a direct  creditor of the Credit
Parties in the amount of such participation.

      (d) Unless the  Administrative  Agent shall have received  notice from the
Company  prior to the date on which  any  payment  is due to the  Administrative
Agent for the  account  of the  Lenders or the  Issuing  Bank  hereunder  that a
Borrower will not make such payment,  the  Administrative  Agent may assume that
such Borrower has made such payment on such date in accordance herewith and may,
in reliance upon such assumption, distribute to the Lenders or the Issuing Bank,
as the case may be, the amount due. In such event,  if such  Borrower has not in
fact made such  payment,  then each of the Lenders or the Issuing  Bank,  as the
case may be, severally agrees to repay to the Administrative  Agent forthwith on
demand the amount so  distributed  to such Lender or the Issuing  Bank with such
interest  thereon,  for each day from and  including  the date  such  amount  is
distributed  to it to but  excluding  the date of payment to the  Administrative
Agent, at the Federal Funds Effective Rate.
      (e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.05(b) or 2.16(d),  then the  Administrative  Agent may, in
its  discretion  (notwithstanding  any  contrary  provision  hereof),  apply any
amounts thereafter received by the Administrative  Agent for the account of such
Lender to satisfy such Lender's  obligations  under such Sections until all such
unsatisfied obligations are fully paid.

      SECTION 2.17. Mitigation Obligations; Replacement of LendersSECTION 2.17.
 .itigation Obligations; Replacement of Lenders

      (a) If any Lender  requests  compensation  under  Section  2.13, or if the
Credit  Parties are required to pay any  additional  amount to any Lender or any
Governmental  Authority for the account of any Lender  pursuant to Section 2.15,
then such Lender shall use reasonable  efforts to designate a different  lending
office for  funding or booking its Loans  hereunder  or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates,  if, in
the judgment of such Lender, such designation or assignment W would eliminate or
reduce amounts payable  pursuant to Section 2.13 or 2.15, as the case may be, in
the future and (ii) would not subject  such Lender to any  unreimbursed  cost or
expense and would not otherwise be  disadvantageous  to such Lender. The Company
hereby agrees to pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment.

      (b) If any Lender  requests  compensation  under  Section  2.13, or if the
Credit  Parties are required to pay any  additional  amount to any Lender or the
Administrative Agent or any Governmental Authority for the account of any Lender
pursuant to Section  2.15, or if any Lender  defaults in its  obligation to fund
Loans  hereunder,  then the Company  may, at its sole  expense and effort,  upon
notice to such  Lender and the  Administrative  Agent,  require  such  Lender to
assign and delegate,  without  recourse (in  accordance  with and subject to the
restrictions  contained  in  Section  10.04),  all  its  interests,  rights  and
obligations  under  this  Agreement  to  an  assignee  that  shall  assume  such
obligations  (which  assignee may be another  Lender,  if a Lender  accepts such
assignment);  Provided  that W the Company shall have received the prior written
consent of the Administrative Agent (and, if a Commitment is being assigned, the
Issuing  Bank),  which consent  shall not  unreasonably  be withheld,  (ii) such
Lender  shall  have  received  payment  of an  amount  equal to the  outstanding
principal of its Loans,  accrued  interest  thereon,  accrued fees and all other
amounts  payable  to it  hereunder,  from the  assignee  (to the  extent of such
outstanding  principal  and accrued  interest and fees) or the Borrowers (in the
case  of all  other  amounts)  and  (iii)  in the  case of any  such  assignment
resulting from a claim for compensation  under Section 2.13 or payments required
to be made pursuant to Section 2.15,  such assignment will result in a reduction
in such  compensation  or  payments.  A Lender shall not be required to make any
such  assignment and delegation if, within five days after the Company  notifies
such  Lender  of its  intent  to  require  such  Lender  to make the  assignment
contemplated  by this  Section  2.17,  as a result of a waiver by such Lender or
otherwise,  the  circumstances  entitling the Company to require such assignment
and delegation cease to apply.


 .     SECTION 2.18. Increase of CommitmentsSECTION 2.18. Increase of Commitments

      (a) The  Company  shall have the right at any time  prior to the  Maturity
Date to  increase  the  aggregate  principal  amount  of the  Commitments  by an
aggregate  amount  for all  such  increases  not  exceeding  $50,000,000  by (i)
requesting to the  Administrative  Agent that the existing  Lenders increase the
aggregate  principal amount of their  Commitments in a principal amount not less
than $10,000,000 or an integral multiple of $1,000,000 in excess thereof or (ii)
adding one or more Persons to this  Agreement  as Lenders,  with the approval of
the  Administrative  Agent (which approval shall not be unreasonably  withheld),
provided that the  Commitment of any such Person shall be in a principal  amount
not less than  $10,000,000  (or such  lesser  amount  which,  when  added to the
existing  Commitments,  shall  cause  the  aggregate  principal  amount  of  all
increases of the Commitments to equal  $50,000,000).  The Commitments may not be
increased pursuant to this Section 2.18 more than once during any calendar year.

      (b) In the event that the Company  exercises its option pursuant to clause
W of Section 2.18(a), the Administrative Agent shall promptly notify each Lender
of such request,  and each Lender shall in turn, in its sole discretion,  within
30 days  after  receipt  of such  notice,  notify  the  Administrative  Agent in
writing, which notice shall be irrevocable, (i) of the principal amount by which
it agrees to increase its  Commitment  (with  respect to each such  Lender,  its
"Proposed Increased  Commitment") or (ii) that it does not agree to increase its
Commitment.  In no event shall a Lender's Proposed  Increased  Commitment exceed
the  principal  amount of the increase  requested by the Company.  If any Lender
shall fail to notify the  Administrative  Agent in  writing of its  decision  to
increase  its  Commitment,  such  Lender  shall  be  deemed  not to  agree to an
increase.  The Administrative  Agent shall first allocate the requested increase
of  Commitments  to each Lender that agrees to  increase  its  Commitment  in an
amount  equal  to  such  Lender's  pro  rata  share  of the  requested  increase
(determined in accordance  with the existing  Commitments)  or, if such Lender's
Proposed  Increased  Commitment is less than its pro rata share of the requested
increase (determined in accordance with the existing Commitments),  in an amount
equal to such Lender's Proposed Increased  Commitment.  The remaining portion of
the requested increase, if any, shall be allocated to the Lenders whose Proposed
Increased  Commitments  exceed their respective pro rata share of such requested
increase  (determined in accordance with the existing  Commitments)  pro rata in
accordance  with  each  such  Lender's  Proposed   Increased   Commitment.   The
Administrative Agent shall notify the Company and the Lenders of such allocation
and the date such increase shall be effective, which date shall be not less than
5 Business  Days after such  notification  has been given to the Company and the
Lenders.  In no  event  shall  a  Lender's  allocated  share  of  the  increased
Commitments exceed its Proposed Increased Commitment.

      (c) In the event that the Company  exercises its option pursuant to clause
(ii) of Section  2.18(a),  each Person  which  shall be added as a Lender  shall
promptly deliver to the Administrative  Agent an agreement in form and substance
satisfactory to the Company and the Administrative  Agent pursuant to which such
Person shall  undertake a Commitment.  Upon the effective date of such agreement
as  specified  therein,  such Person  shall  become a Lender  hereunder  and the
Administrative  Agent shall record the information  reflecting such agreement in
the Register.

      (d) Notwithstanding any other provision of this Section 2.18, the right of
the Company to increase the aggregate  principal amount of the Commitments shall
be subject to the following conditions:

      (i) no Default  shall have occurred and be continuing on and as of each of
      the date of the request by the Company  referred to in Section 2.18(a) and
      the effective date of the increase of Commitments under Section 2.18(b) or
      the addition of a Lender pursuant to Section  2.18(c),  as the case may be
      (the "Relevant Increased Commitment Date");

      (ii) the representations and warranties of the Credit Parties set forth in
      this Agreement and the other Credit Documents shall be true and correct on
      and as of the date of the  request by the  Company  referred to in Section
      2.18(a) and the Relevant Increased Commitment Date;

      (iii)if any Loans shall be outstanding hereunder on any Relevant Increased
      Commitment  Date,  the  Company  shall,   notwithstanding  any  provisions
      contained  herein  regarding the minimum amount or pro rata nature of such
      borrowing or  prepayment  (A) borrow ABR Loans on the  Relevant  Increased
      Commitment  Date or, in the case of Eurodollar  Loans,  on the last day of
      the first  Interest  Period(s) to expire  thereafter  (1) from the Lenders
      increasing their Commitments (in the case of an increase effected pursuant
      to Section 2.18(b)) or (2) from the Person or Persons becoming Lenders (in
      the case of an  increase  effected  pursuant  to Section  2.18(c)  and (B)
      prepay  AER  Loans  (on  the  Relevant  Increased   Commitment  Date)  and
      Eurodollar  Loans  (on the last day of the  first  Interest  Period(s)  to
      expire  thereafter)  owing to the other  Lenders in such  amounts and such
      types that,  after giving effect thereto,  all of the Eurodollar Loans and
      all of the AER Loans  shall be  allocated  among the  Lenders  pro rata in
      accordance with the amounts of their respective  Commitments (after giving
      effect to the increase in the aggregate amount of the Commitments), all in
      accordance  with  Section  2.09 (other than any  provision  regarding  the
      minimum amount of such prepayment contained therein);

      (iv)  the Company shall not have reduced the Commitments pursuant to 
      Section 2.07(b); and

      (v)   at no time shall the aggregate principal amount of the Commitments 
      exceed $300,000,000.

Each request for an increase of the Commitments under this Section 2.18 shall be
deemed to constitute a  representation  and warranty by the Credit Parties as to
the  matters  specified  in clauses  and (ii) above  (both as of the date of the
request by the Company  referred to in Section  2.18(a) and,  unless the Company
notifies  the  Administrative  Agent  to the  contrary  prior  to  the  Relevant
Increased Commitment Date, on such Relevant Increased Commitment Date).


                             ARTICLE IIIARTICLE III

 . The Company hereby guarantees to each Lender and the Administrative  Agent and
their  respective  successors  and assigns  the prompt  payment in full when due
(whether at stated  maturity,  by acceleration or otherwise) of the principal of
and interest on the Loans made by the Lenders to, the  Subsidiary  Borrowers and
all other  amounts  from time to time owing to the Lenders,  the  Administrative
Agent or the  Issuing  Bank by the  Subsidiary  Borrowers  under this  Agreement
(collectively,   the  "Guaranteed  Obligations"),   in  each  case  strictly  in
accordance with the terms thereof. The Company hereby further agrees that if the
Subsidiary  Borrowers  shall  fail to pay in full  when due  (whether  at stated
maturity, by acceleration or otherwise) any of the Guaranteed  Obligations,  the
Company  will  promptly  on  demand  pay the  same,  and that in the case of any
extension  of time of payment or renewal of any of the  Guaranteed  Obligations,
the same will be promptly  paid in full when due (whether at extended  maturity,
by  acceleration or otherwise) in accordance with the terms of such extension or
renewal.

 . The obligations of the Company under Section 3.01 are absolute, unconditional,
irrespective of the value, genuineness,  validity,  regularity or enforceability
of the obligations of the Subsidiary Borrowers under this Agreement or any other
agreement  or  instrument  referred to herein or therein,  or any  substitution,
release  or  exchange  of any  other  guarantee  of or  security  for any of the
Guaranteed Obligations,  and, to the fullest extent permitted by applicable law,
irrespective  of  any  other   circumstance   whatsoever  that  might  otherwise
constitute a legal or equitable  discharge or defense of a surety or  guarantor,
it being the intent of this  Section  3.02 that the  obligations  of the Company
hereunder shall be absolute and unconditional  under any and all  circumstances.
Without limiting the generality of the foregoing,  it is agreed,  to the fullest
extent permitted by law, that the occurrence of any one or more of the following
shall not alter or impair the  liability  of the Company  hereunder  which shall
remain absolute and unconditional as described above:

      (i) at any time or from time to time,  without notice to the Company,  the
time for any performance of or compliance with any of the Guaranteed obligations
shall be extended, or such performance or compliance shall be waived;

     (ii) any of the acts  mentioned in any of the  provisions of this Agreement
or any other agreement or instrument referred to herein or therein shall be done
or omitted;
     (iii)  the  maturity  of  any  of  the  Guaranteed   Obligations  shall  be
accelerated,   or  any  of  the  Guaranteed   Obligations   shall  be  modified,
supplemented or amended in any respect, or any right under this Agreement or any
other  agreement or instrument  referred to herein or therein shall be waived or
any  other  guarantee  of any  of the  Guaranteed  Obligations  or any  security
therefor  shall be released or exchanged in whole or in part or otherwise  dealt
with; or

     (iv) any  lien or  security  interest  granted  to,  or in  favor  of,  the
Administrative  Agent  or any  Lender  or  Lenders  as  security  for any of the
Guaranteed Obligations shall fail to be perfected.

To the fullest  extent  permitted by law, the Company  hereby  expressly  waives
diligence,  presentment,  demand of payment to any Subsidiary Borrower,  protest
and all notices whatsoever, and any requirement that the Administrative Agent or
any Lender exhaust any right,  power or remedy or proceed against the Subsidiary
Borrowers under this Agreement or any other agreement or instrument  referred to
herein or therein,  or against any other Person under any other guarantee of, or
security for, any of the Guaranteed Obligations.

 . The  obligations of the Company under this Article III shall be  automatically
reinstated  if and to the extent that for any reason any payment by or on behalf
of any Subsidiary Borrower in respect of the Guaranteed obligations is rescinded
or  must  be  otherwise  restored  by  any  holder  of  any  of  the  Guaranteed
Obligations,   whether  as  a  result  of  any   proceedings  in  bankruptcy  or
reorganization  or otherwise and the Company  agrees that it will  indemnify the
Administrative  Agent and each  Lender on demand  for all  reasonable  costs and
expenses  (including,  without  limitation,  fees of  counsel)  incurred  by the
Administrative  Agent or such  Lender  in  connection  with such  rescission  or
restoration, including any such costs and expenses incurred in defending against
any claim  alleging  that such  payment  constituted  a  preference,  fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.

 .  The  Company  hereby  waives,   until  payment  in  full  of  the  Guaranteed
obligations,  all rights of  subrogation  or  contribution,  whether  arising by
contract or  operation of law  (including,  without  limitation,  any such right
arising under the U.S. Bankruptcy Code) or otherwise by reason of any payment by
them pursuant to the provisions of this Article III.

 . The  Company  agrees  that,  as  between  the  Company  and the  Lenders,  the
obligations of the Subsidiary  Borrowers under this Agreement may be declared to
be forthwith due and payable as provided in Article VIII (and shall be deemed to
have become automatically due and payable in the circumstances  provided in said
Article VIII) for purposes of Section 3.01 notwithstanding any stay,  injunction
or other  prohibition  preventing  such  declaration (or such  obligations  from
becoming  automatically due and payable) as against the Subsidiary Borrowers and
that, in the event of such declaration (or such obligations being deemed to have
become automatically due and payable),  such obligations (whether or not due and
payable by the Subsidiary  Borrowers)  shall forthwith become due and payable by
the Company for purposes of Section 3.01.

     SECTION 3.06 Instrument for the Payment of MoneySECTION 3.06 Instrument for
the . The Company  hereby  acknowledges  that the  guarantee in this Article III
constitutes an instrument for the payment of money, and consents and agrees that
any Lender or the  Administrative  Agent, at its sole option,  in the event of a
dispute by such Guarantor in the payment of any moneys due hereunder, shall have
the right to bring motion-action under New York CPLR Section 3324.

 . The guarantee in this Article III is a continuing  guarantee,  and shall apply
to all Guaranteed Obligations whenever arising.


                                   ARTICLE IV

         Representations and WarrantiesARTICLE IVRepresentations and Warranties

     Each  Credit  Party   represents   and  warrants  (as  to  itself  and  its
Subsidiaries only) to the Lenders that:

 . Each of the Company and its  Subsidiaries is duly organized,  validly existing
and in good standing under the laws of the jurisdiction of its organization, has
all requisite power and authority to carry on its business as now conducted and,
except where the failure to do so,  individually or in the aggregate,  could not
reasonably be expected to result in a Material  Adverse Effect,  is qualified to
do  business  in, and is in good  standing  in,  every  jurisdiction  where such
qualification is required.

     SECTION 4.02. Authorization;  EnforceabilitySECTION 4.02. Authorization;  .
The Transactions  are within each Credit Party's  corporate powers and have been
duly authorized by all necessary corporate and, if required, stockholder action.
Each of this Agreement and each other Credit Document has been duly executed and
delivered  by each Credit  party  thereto  and  constitutes  a legal,  valid and
binding obligation of each such Credit Party, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization,  moratorium
or other laws  affecting  creditors,  rights  generally  and  subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.

     SECTION   4.03.   Governmental   Approvals;   No   ConflictsSECTION   4.03.
Governmental . The  Transactions  (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority,
except such as have been obtained or made and are in full force and effect,  (b)
will not violate any  applicable  law or regulation  or the charter,  by-laws or
other  organizational  documents of the Company or of any of  Subsidiary  or any
order of any Governmental Authority, (c) will not violate or result in a default
under any indenture,  agreement or other instrument  binding upon the Company or
any Subsidiary or its assets,  or give rise to a right thereunder to require any
payment to be made by the Company or any Subsidiary,  and (d) will not result in
the  creation  or  imposition  of any Lien on any  asset of the  Company  or any
Subsidiary.

     SECTION 4.04. Financial Condition; No Material Adverse ChangeSECTION 4.04.
 .inancial Condition; No Material Adverse Change

     (a) The Company has  heretofore  furnished to the Lenders its  consolidated
balance sheet and statements of income,  stockholders  equity and cash flows (i)
as of and for the fiscal year ended February 29, 1996,  reported on by KPMG Peat
Marwick  L.L.P.,  independent  public  accountants,  and  (ii) as of and for the
fiscal  quarter  and the  portion of the fiscal year ended  November  30,  1996,
certified by its chief  financial  officer.  Such financial  statements  present
fairly,  in all  material  respects,  the  financial  position  and  results  of
operations and cash flows of the Company and its consolidated Subsidiaries as of
such dates and for such  periods in  accordance  with GAAP,  subject to year-end
audit  adjustments  and the absence of footnotes  in the case of the  statements
referred to in clause (ii) above.

      (b) Since February 29, 1996,  there has been no material adverse change in
the  business,  assets,  operations,   prospects  or  condition,   financial  or
otherwise, of the Company
and its Subsidiaries, taken as a whole.

 .ECTION 4.05. PropertiesSECTION 4.05. Properties

      (a) Each of the Company and its  Subsidiaries  has good title to, or valid
leasehold  interests  in, all its real and  personal  property  material  to its
business,  except  for minor  defects in title  that do not  interfere  with its
ability to conduct  its  business  as  currently  conducted  or to utilize  such
properties for their intended purposes.

      (b) Each of the Company and its Subsidiaries  owns, or is licensed to use,
all trademarks,  tradenames, copyrights, patents and other intellectual property
material  to  its  business,  and  the  use  thereof  by  the  Company  and  its
Subsidiaries  does not infringe upon the rights of any other Person,  except for
any  such  infringements  that,  individually  or in the  aggregate,  could  not
reasonably be expected to result in a Material Adverse Effect.

      SECTION 4.06. Litigation and Environmental MattersSECTION 4.06. Litigation
 and Environmental Matters

      (a) There are no actions, suits or proceedings by or before any arbitrator
or Governmental Authority now pending against or, to the knowledge of any Credit
Party,  threatened  against or affecting the Company or any Subsidiary (i) as to
which there is a reasonable possibility of an adverse determination and that, if
adversely  determined,  could  reasonably  be expected,  individually  or in the
aggregate,  to result in a Material  Adverse  Effect or (ii) that  involve  this
Agreement or the Transactions.
      (b)  Except  with  respect to any  matters  that,  individually  or in the
aggregate,  could not  reasonably  be expected  to result in a Material  Adverse
Effect, neither the Company nor any Subsidiary (i) has failed to comply with any
Environmental Law or to obtain,  maintain or comply with any permit,  license or
other approval required under any Environmental  Law, (ii) has become subject to
any Environmental Liability, (iii) has received notice of any claim with respect
to any Environmental  Liability or (iv) knows of any basis for any Environmental
Liability.

      SECTION 4.07. Compliance with Laws and AgreementsSECTION  4.07. Compliance
with . Each of the Company and its  Subsidiaries is in compliance with all laws,
regulations  and orders of any  Governmental  Authority  applicable to it or its
property and all indentures, agreements and other instruments binding upon it or
its  property,  except  where  the  failure  to do  so,  individually  or in the
aggregate,  could not  reasonably  be expected  to result in a Material  Adverse
Effect. No Default has occurred and is continuing.

      SECTION  4.08.   Investment  and  Holding  Company   StatusSECTION   4.08.
Investment  and . Neither the Company nor any  Subsidiary is (a) an  "investment
company" as defined in, or subject to regulation  under, the Investment  Company
Act of 1940 or (b) a "holding  company" as defined in, or subject to  regulation
under, the Public Utility Holding Company Act of 1935.

 . Each of the  Company  and its  Subsidiaries  has timely  filed or caused to be
filed all Tax returns  and  reports  required to have been filed and has paid or
caused to be paid all Taxes  required to have been paid by it,  except (a) Taxes
that are being contested in good faith by appropriate  proceedings and for which
the  Company  or such  Subsidiary,  as  applicable,  has set  aside on its books
adequate  reserves  or (b) to the  extent  that the  failure  to do so could not
reasonably be expected to result in a Material Adverse Effect.

  No ERISA Event has  occurred  or is  reasonably  expected to occur that,  when
taken  together  with all  other  such  ERISA  Events  for  which  liability  is
reasonably  expected  to occur,  could  reasonably  be  expected  to result in a
Material  Adverse  Effect.   The  present  value  of  all  accumulated   benefit
obligations  of all  under  funded  Plans  (based  on the  assumptions  used for
purposes of Statement of Financial  Accounting  Standards No. 87) did not, as of
the date of the most recent financial statements reflecting such amounts, exceed
the fair market  value of the assets of all such under funded Plans by more than
$10,000,000.

 . The Company has  disclosed  to the Lenders  all  agreements,  instruments  and
corporate  or other  restrictions  to which the  Company  or any  Subsidiary  is
subject,  and all  other  matters  known  to it,  that,  individually  or in the
aggregate,  could reasonably be expected to result in a Material Adverse Effect.
The reports,  financial statements,  certificates or other information furnished
by or on behalf of the Company or any Subsidiary to the Administrative  Agent or
any Lender in connection  with the  negotiation  of this  Agreement or delivered
hereunder (as modified or supplemented by other information so furnished),  when
taken as a whole,  do not contain any  misstatement  of material fact or omit to
state any material fact necessary to make the statements therein in the light of
the  circumstances  under which they were made, not  misleading;  provided that,
with respect to projected  financial  information,  the Company  represents only
that such information was prepared in good faith based upon assumptions believed
to be reasonable at the time.

                                    ARTICLE V

                          ConditionsARTICLE VConditions

 . The  obligations of the Lenders to make Loans and of the Issuing Bank to issue
Letters of Credit  hereunder shall not become  effective until the date on which
each of the following  conditions  is satisfied  (or waived in  accordance  with
Section 10.02):

      (a) The  Administrative  Agent (or its counsel)  shall have  received from
each party hereto either (i) a counterpart of this Agreement signed on behalf of
such party or (ii) written  evidence  satisfactory to the  Administrative  Agent
(which may include  telecopy  transmission  of a signed  signature  page of this
Agreement) that such party has signed a counterpart of this Agreement.

      (b) The  Administrative  Agent  shall have  received a  favorable  written
opinion  (addressed  to the  Administrative  Agent and the Lenders and dated the
Effective Date) of Ropes & Gray,  counsel for the Company and its  Subsidiaries,
substantially in the form of Exhibit B, and covering such other matters relating
to the Company and its  Subsidiaries,  this Agreement or the Transactions as the
Required  Lenders shall  reasonably  request.  The Company hereby  requests such
counsel to deliver such opinion.

      (c) The  Administrative  Agent  shall have  received  such  documents  and
certificates as the  Administrative  Agent or its counsel may reasonably request
relating to the  organization,  existence and good standing of the Company,  the
authorization  of the  Transactions  and any other legal matters relating to the
Company,  this  Agreement  or  the  Transactions,  all  in  form  and  substance
satisfactory to the Administrative Agent and its counsel.

      (d) The Administrative Agent shall have received a certificate,  dated the
Effective  Date and signed by the  President,  a Vice  President  or a Financial
Officer of the Company,  confirming  compliance with the conditions set forth in
paragraphs  (a) and (b) of Section 5.02 and  specifying the Leverage Ratio as of
said date.

      (e) Each of the Administrative  Agent and the Syndication Agent shall have
received all fees and other amounts due and payable on or prior to the Effective
Date,  including,  to the  extent  invoiced,  reimbursement  or  payment  of all
out-of-pocket  expenses  required  to be  reimbursed  or  paid  by  the  Company
hereunder.  The Administrative Agent shall notify the Company and the Lenders of
the  Effective   Date,   and  such  notice  shall  be  conclusive  and  binding.
Notwithstanding the foregoing,  the obligations of the Lenders to make Loans and
of the  Issuing  Bank to issue  Letters  of Credit  hereunder  shall not  become
effective  unless  each of the  foregoing  conditions  is  satisfied  (or waived
pursuant  to  Section  10.02) at or prior to 3:00 p.m.,  New York City time,  on
March 14,  1997  (and,  in the event such  conditions  are not so  satisfied  or
waived, the Commitments shall terminate at such time).

 . The  obligation of each Lender to make a Loan to the Company or any Subsidiary
Borrower, and of the Issuing Bank to issue, amend, renew or extend any Letter of
Credit, is subject to the satisfaction of the following conditions:

      (a) The  representations and warranties of the Credit Parties set forth in
this Agreement and the other Credit  Documents  shall be true and correct on and
as of the date of such Loan is made or the date of issuance,  amendment, renewal
or extension of such Letter of Credit, as applicable.

      (b) At the time of and  immediately  after giving  effect to the making of
such Loan or the  issuance,  amendment,  renewal or  extension of such Letter of
Credit, as applicable, no Default shall have occurred and be continuing.

Each  borrowing  of a Loan by the  Company  or a  Subsidiary  Borrower  and each
issuance,  amendment, renewal or extension of a Letter of Credit shall be deemed
to constitute a  representation  and warranty by the Credit  Parties on the date
thereof as to the matters specified in paragraphs (a) and (b) of this Section.

                                   ARTICLE VI

                              Affirmative Covenants

      Until the Commitments have expired or been terminated and the principal of
and interest on each Loan and all fees payable hereunder shall have been paid in
full and all  Letters of Credit  shall have  expired  or  terminated  and all LC
Disbursements shall have been reimbursed,  the Company covenants and agrees with
the Lenders that:

       SECTION 6.01.  Financial  Statements and Other  InformationSECTION  6.01.
Financial  .  The  Company  will  furnish  to  the  Administrative  Agent  (with
sufficient copies for each Lender),  and the Administrative Agent shall promptly
furnish to each Lender:

      (a) within 10 Business Days after the  electronic  filing of the same with
the SEC,  but in no event  later than 120 days after the end of each fiscal year
of the Company, its audited consolidated balance sheet and related statements of
operations,  stockholders'  equity  and cash flows as of the end of and for such
year,  setting  forth  in each  case in  comparative  form the  figures  for the
previous  fiscal  year,  all reported on by KPMG Peat  Marwick  L.L.P.  or other
independent public accountants of recognized national standing (without a "going
concern" or like  qualification  or exception and without any  qualification  or
exception  as to the scope of such audit) to the effect  that such  consolidated
financial  statements  present  fairly in all material  respects  the  financial
condition  and  results  of  operations  of the  Company  and  its  consolidated
Subsidiaries  on a  consolidated  basis in  accordance  with  GAAP  consistently
applied;

      (b) within 10 Business Days after the  electronic  filing of the same with
the SEC,  but in no event  later than 60 days after the end of each of the first
three  fiscal  quarters  of each fiscal year of the  Company,  its  consolidated
balance sheet and related  statements of  operations,  stockholders,  equity and
cash flows as of the end of and for such  fiscal  quarter  and the then  elapsed
portion of the fiscal year,  setting forth in each case in comparative  form the
figures  for the  corresponding  period or  periods  of (or,  in the case of the
balance sheet,  as of the end of) the previous fiscal year, all certified by one
of its  Financial  Officers as  presenting  fairly in all material  respects the
financial   condition   and  results  of  operations  of  the  Company  and  its
consolidated  Subsidiaries  on a  consolidated  basis in  accordance  with  GAAP
consistently  applied,  subject to normal  year-end  audit  adjustments  and the
absence of footnotes;

      (c) concurrently with any delivery of financial statements under paragraph
(a) or (b)  above,  a  certificate  of a  Financial  Officer  of the  Company  W
certifying  as to whether a Default has occurred and, if a Default has occurred,
specifying the details thereof and any action taken or proposed to be taken with
respect   thereto,   (ii)  setting  forth   reasonably   detailed   calculations
demonstrating  compliance  with Sections 7.07,  7.08 (including a calculation of
the amount of Interest  Expense paid or payable in cash) and 7.09, (iii) setting
forth the  Applicable  Rates to be applied  commencing on the fifth Business Day
following the date of receipt by the  Administrative  Agent of such  certificate
and the related financial statements and (iv) stating whether any change in GAAP
or in the  application  thereof  has  occurred  since  the  date of the  audited
financial  statements  referred  to in Section  4.04 and, if any such change has
occurred,  specifying  the  effect of such  change on the  financial  statements
accompanying such certificate;

      (d) concurrently with any delivery of financial statements under paragraph
(a) above, a certificate of the accounting  firm that reported on such financial
statements  stating whether they obtained  knowledge  during the course of their
examination of such financial  statements of any Default (which  certificate may
be limited to the extent required by accounting rules or guidelines);

      (e)  promptly  after the same  become  publicly  available,  copies of all
periodic and other reports,  proxy  statements and other  materials filed by the
Company or any Subsidiary with the SEC, or any Governmental Authority succeeding
to any or all  of the  functions  of  said  Commission,  or  with  any  national
securities  exchange,   or  distributed  by  the  Company  to  its  shareholders
generally, as the case may be; and

      (f)  promptly  following  any  request  therefor,  such other  information
regarding  the  operations,  business  affairs and  financial  condition  of the
Company or any Subsidiary,  or compliance  with the terms of this Agreement,  as
the Administrative Agent or any Lender may reasonably request.

 . The Company will furnish to the Administrative  Agent prompt written notice of
the s following (and the  Administrative  Agent shall promptly furnish a copy of
such notice to each Lender):

 ......     (a)  the occurrence of any Default;

 .....(b) the filing or  commencement  of any action,  suit or  proceeding  by or
      before any arbitrator or Governmental  Authority  against or affecting the
      Company or any  Affiliate  thereof that,  if adversely  determined,  could
      reasonably be expected to result in a Material Adverse Effect;

 .....(c) the  occurrence  of any ERISA  Event that,  alone or together  with any
      other ERISA Events that have  occurred,  could  reasonably  be expected to
      result in  liability of the Company and its  Subsidiaries  in an aggregate
      amount exceeding $10,000,000; and

 .....(d) any other  development that results in, or could reasonably be expected
      to result in, a Material Adverse Effect.

Each notice  delivered under this Section shall be accompanied by a statement of
a Financial  officer or other executive officer of the Company setting forth the
details of the event or  development  requiring such notice and any action taken
or proposed to be taken with respect thereto.

      SECTION  6.03.  Existence;  Conduct of  BusinessSECTION  6.03.  Existence;
Conduct of . The Company will, and will cause each Subsidiary to, do or cause to
be done all  things  necessary  to  preserve,  renew and keep in full  force and
effect its legal  existence and the rights,  licenses,  permits,  privileges and
franchises material to the conduct of its business;  provided that the foregoing
shall not prohibit any merger, consolidation,  liquidation,  dissolution or sale
permitted under Section 7.03.

 . The Company  will,  and will cause each  Subsidiary  to, pay its  obligations,
including Tax liabilities, that, if not paid, could result in a Material Adverse
Effect before the same shall become  delinquent or in default,  except where (a)
the validity or amount  thereof is being  contested in good faith by appropriate
proceedings,  (b) the  Company  or such  Subsidiary  has set  aside on its books
adequate  reserves  with  respect  thereto in  accordance  with GAAP and (c) the
failure to make payment pending such contest could not reasonably be expected to
result in a Material Adverse Effect.

      SECTION 6.05. Maintenance of Properties; InsurancSECTION 6.05. Maintenance
of e. The Company will, and will cause each Subsidiary to, (a) keep and maintain
all property  material to the conduct of its business in good working  order and
condition,  ordinary wear and tear excepted, and (b) maintain,  with financially
sound and reputable insurance  companies,  insurance in such amounts and against
such risks as are  customarily  maintained  by companies  engaged in the same or
similar businesses operating in the same or similar locations.

      SECTION 6.06. Books and Records;  Inspection RightsSECTION 6.06. Books and
 . The Company  will,  and will cause each  Subsidiary  to, keep proper  books of
record and  account in which  full,  true and  correct  entries  are made of all
dealings  and  transactions  in  relation  to its  business  and  activities  in
accordance  with GAAP.  The Company  will,  and will cause each  Subsidiary  to,
permit  representatives  designated by the  Administrative  Agent or any Lender,
upon reasonable prior notice through the Administrative  Agent and at reasonable
times,  to visit and inspect its  properties,  to examine and make extracts from
its books and records,  and to discuss its affairs,  finances and condition with
its officers and independent  accountants,  provided that, so long as no Default
shall  have  occurred  and be  continuing,  not  more  than  one  such  visit by
representatives  of the  Administrative  Agent and/or one or more of the Lenders
must be permitted during any calendar year.

 . The Company  will,  and will cause each  Subsidiary  to, comply with all laws,
rules,  regulations and orders of any Governmental Authority applicable to it or
its  property,  except  where  the  failure  to do  so,  individually  or in the
aggregate,  could not  reasonably  be expected  to result in a Material  Adverse
Effect.

 . The proceeds of the Loans will be used only for general corporate  purposes of
the Company or any Subsidiary (including any acquisition of all or substantially
all of the capital stock of any Person,  provided that such acquisition has been
approved by the board of directors of such  Person).  No part of the proceeds of
any Loan will be used,  whether  directly or  indirectly,  for any purpose  that
entails  a  violation  of  any  of  the  regulations  of  the  Board,  including
Regulations G, U and X.

                                   ARTICLE VII

                               Negative Covenants
ARTICLE VIINegative Covenants
      Until the Commitments  have expired or terminated and the principal of and
interest on each Loan and all fees payable  hereunder have been paid in full and
all Letters of Credit have expired or terminated and all LC Disbursements  shall
have been reimbursed, the Company covenants and agrees with the Lenders that:

 . The Company will not, and will not permit any Subsidiary  to,  create,  incur,
assume or permit to exist any Indebtedness, except:

 ......     (a)  Indebtedness created hereunder;

      (b)  Indebtedness of the Company to any Subsidiary and
of any Subsidiary to the Company or another Subsidiary  (including Guarantees by
the  Company  of  Indebtedness  of  any  Subsidiary  or  by  any  Subsidiary  of
Indebtedness of the Company or any other Subsidiary);

      (c)  Indebtedness  of the Company or any Subsidiary as an account party in
respect of letters of credit  issued in the ordinary  course of business and not
supporting Indebtedness;

      (d)  Indebtedness of Subsidiaries to Persons other than the Company or 
another Subsidiary in an aggregate principal amount not exceeding $45,000,000;

      (e)  Indebtedness  of the Company that is subordinated by its terms to the
obligations of the Company to pay principal of and interest on the Loans and all
other amounts owing hereunder,  and governed by  documentation  containing terms
not less favorable than those typically  found in publicly  issued  subordinated
debt or otherwise in form and substance reasonably  satisfactory to the Required
Lenders; and

      (f) other Indebtedness of the Company in an aggregate principal amount not
exceeding  $200,000,000;  Provided that the aggregate  principal  amount of such
other  Indebtedness  secured by assets of the  Company  and/or its  Subsidiaries
shall not exceed $45,000,000.

 . The Company will not, and will not permit any Subsidiary  to,  create,  incur,
assume  or  permit  to exist  any Lien on any  Property  or asset  now  owned or
hereafter  acquired by it, or assign or sell any income or  revenues  (including
accounts receivable) or rights in respect of any thereof, except:

           (a)  Permitted Encumbrances;

      (b) Liens with  respect to goods  shipped and  documents  related  thereto
created in connection with the issuance of trade letters of credit;

(c)   any Lien on Margin Stock; and

      (d) any Lien on any  property  or asset of the  Company or any  Subsidiary
securing Indebtedness permitted by Section 7.01(d) or Section 7.01(f).

 .ECTION 7.03. Fundamental ChangesSECTION 7.03. Fundamental Changes

      (a) The Company  will not,  and will not permit any  Subsidiary  to, merge
into or consolidate  with any other Person,  or permit any other Person to merge
into or  consolidate  with it, or liquidate or dissolve,  except that, if at the
time thereof and  immediately  after giving effect thereto no Default shall have
occurred  and be  continuing  (i) any  Person  may merge  into the  Company in a
transaction  in  which  the  Company  is the  surviving  corporation,  (ii)  any
Subsidiary  may merge into another  Subsidiary,  provided that, if only one such
Subsidiary  is a  Subsidiary  Borrower,  the  Subsidiary  Borrower  shall be the
surviving corporation, (iii) any Subsidiary may merge into another Person if the
Person  surviving  the  merger  becomes or remains a  Subsidiary  (and,  if such
Subsidiary was a Subsidiary Borrower immediately prior to such merger, becomes a
Subsidiary  Borrower) and (iv) any Subsidiary (other than a Subsidiary Borrower)
may liquidate or dissolve; provided that any such merger involving a Person that
is not a wholly owned Subsidiary  immediately  prior to such merger shall not be
permitted unless also permitted by Section 7.04.

      (b) The Company  will not,  and will not permit any  Subsidiary  to, sell,
transfer,  lease or otherwise  dispose of any part of its assets  (including the
stock of any of its  Subsidiaries),  in each case whether now owned or hereafter
acquired, except that:

      (i)  any Subsidiary may sell, transfer, lease or otherwise dispose of its 
 assets to the Company or to another Subsidiary;

      (ii) the Company or any Subsidiary may sell, transfer,  lease or otherwise
      dispose of inventory or other assets in the ordinary course of business;

      (iii)    the Company or any Subsidiary may sell, transfer, lease or 
      otherwise dispose of any obsolete assets;

      (iv) the Company or any Subsidiary may bell, transfer or otherwise dispose
      of any Margin Stock;

      (v) in addition to the transactions permitted under the foregoing clauses,
      the  Company or any  Subsidiary  may sell,  transfer,  lease or  otherwise
      dispose of any assets for not less than fair market  value if the value of
      the  assets  sold,  transferred,  leased  or  disposed  pursuant  to  such
      transaction, when added to the value of all other assets theretofore sold,
      transferred,  leased or disposed  pursuant  to this  clause (v),  does not
      exceed 25% of the Company's  consolidated tangible assets (as set forth in
      the most  recent  audited  financial  statement  of the  Company  provided
      pursuant to the Section 6.01(a)).

      (c) The Company will not, and will not permit any Subsidiary to, engage to
any material  extent in any business other than businesses of the type conducted
by the Company and its  Subsidiaries  on the date of execution of this Agreement
and businesses reasonably related thereto.

      SECTION 7.04. Investments, Loans, Advances, Guarantees and Acquisitions; 
Hedging Agreements.SECTION 7.04. Investments, Loans, Advances, Guarantees and 
Acquisitions; Hedging Agreements.

      (a) The Company will not, and will not permit any Subsidiary to, purchase,
hold or acquire (including pursuant to any merger with any Person that was not a
wholly owned  Subsidiary  prior to such merger) any capital stock,  evidences of
indebtedness or other securities  (including any option,  warrant or other right
to  acquire  any of the  foregoing)  of,  make or  permit  to exist any loans or
advances  to,  Guarantee  any  obligations  of,  or make or  permit to exist any
investment or any other interest in, any other Person,  or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person constituting a business unit, except:

(i)        Permitted Investments;

(ii)      investments by the Company in the capital
stock of Subsidiaries;

      (iii)loans or advances made by the Company to any Subsidiary and made by 
any Subsidiary to the Company or any other Subsidiary;

(iv)     Guarantees constituting Indebtedness permitted by Section 7.01;

      (v) minority investments in the capital stock of any Person engaged in the
same or  substantially  similar  lines of  business  to that  engaged  in by the
Company as of the date hereof not to exceed an aggregate  amount of $80,000,000;
Provided that each such  investment  has been approved by the Board of Directors
of such Person;

      (vi)  purchases of publicly  traded capital stock of any Person engaged in
the same or  substantially  similar  lines of business to that engaged in by the
Company  as of the date  hereof,  in an amount  not to exceed St of the  capital
stock of such Person,  provided  that (A) the  aggregate  consideration  paid or
payable  (including any noncash  consideration)  for such capital stock does not
exceed  $15,000,000  and  (B)  the  aggregate   consideration  paid  or  payable
(including  any non-cash  consideration)  for capital stock of all Persons under
this clause (vi) does not exceed $60,000,000; and provided further that any such
purchase  which  leads to the  acquisition  of all or  substantially  all of the
capital  stock of such Person shall be required to comply with the  requirements
of clause (vii) below;

      (vii)in addition to the Investments permitted under the foregoing clauses,
the Company and its  Subsidiaries  may acquire all or  substantially  all of the
capital  stock of any Person  (other  than any  Subsidiary)  (each an  "Acquired
Entity"), in a single transaction or a series of related  transactions,  so long
as:

      (A) each Acquired Entity shall engage in the same or substantially similar
      lines of business to that engaged in by the Company as of the date hereof;

      (B) with respect to any such acquisition  where.  the  consideration to be
      paid  or  payable  (including  any  non-cash  consideration)  will  exceed
      $50,000,000,  the Company shall deliver to the  Administrative  Agent,  no
      later  than  five  Business  Days  prior  to  the   consummation  of  such
      acquisition,   a  copy  of  the  draft  acquisition  agreement  (including
      schedules and exhibits);

      (C) immediately prior to such acquisition and after giving effect thereto,
      no Default shall have occurred or be continuing; and

      (D)  after  giving  effect to such  acquisition  the  Company  shall be in
      compliance  with Sections 7.07, 7.08 and 7.09 (the  determination  of such
      compliance to be calculated on a pro forma basis, as at the end of and for
      the period of four fiscal  quarters most recently  ended prior to the date
      of such acquisition for which financial  statements of the Company and its
      Subsidiaries  are available,  under the assumption  that such  acquisition
      shall have been made or  consummated,  and any  Indebtedness in connection
      therewith  shall have been  incurred,  at the beginning of the  applicable
      period,  and under the  assumption  that interest for such period had been
      equal to the actual weighted average interest rate in effect for the Loans
      hereunder on the date of such acquisition), and on or prior to the date of
      the consummation of such acquisition,  the Company shall have delivered to
      the  Administrative  Agent a certificate of a Financial Officer certifying
      as to W compliance by the Company with the requirements of this clause (D)
      (and providing the  calculations  thereof in reasonable  detail,  together
      with  sufficient  back-up  information  as  reasonably  requested  by  the
      Administrative Agent) and (y) the matters specified in clause (C) above.

      (b) The Company  will not,  and will not permit any  Subsidiary  to, enter
into any Hedging Agreement,  other than Hedging Agreements entered into to hedge
or mitigate risks, including anticipated  transactions,  to which the Company or
any  Subsidiary  is exposed in the conduct of its business or the  management of
its  liabilities,  provided that in no event shall the Company or any Subsidiary
be permitted to enter into any Hedging Agreement for speculative purposes.
      SECTION 7.05.  Transactions with AffiliatesSECTION 7.05. Transactions with
 . The Company will not, and will not permit any  Subsidiary  to, sell,  lease or
otherwise  transfer any  property or assets to, or purchase,  lease or otherwise
acquire  any  property  or  assets  from,  or  otherwise  engage  in  any  other
transactions with, any of its Affiliates,  except (a) at prices and on terms and
conditions  not less favorable to the Company or such  Subsidiary  than could be
obtained  on  an  arm's-length  basis  from  unrelated  third  parties  and  (b)
transactions between or among the Company and its Subsidiaries not involving any
other  Affiliate,  unless such  transaction  complies with the  requirements  of
clause (a) of this Section 7.05 as to such other  Affiliate.  . The Company will
not, and will not permit any  Subsidiary to,  directly or ts  indirectly,  enter
into,  incur or  permit  to  exist  any  agreement  or  other  arrangement  that
prohibits, restricts or imposes any condition upon the ability of any Subsidiary
(a) to pay  dividends or other  distributions  with respect to any shares of its
capital  stock,  (b) to make or repay  loans or  advances  to the Company or any
other Subsidiary or (c) to transfer any of its property or assets to the Company
or any other  Subsidiary;  provided  that (i) the  foregoing  shall not apply to
restrictions  and  conditions  imposed  by law or by this  Agreement,  (ii)  the
foregoing shall not apply to customary  restrictions and conditions contained in
agreements  relating to the sale of any Subsidiary  pending such sale,  provided
such restrictions and conditions apply only to the Subsidiary that is to be sold
and such sale is permitted  hereunder,  (iii) the  foregoing  shall not apply to
restrictions or conditions  imposed by any agreement  relating to any Person, or
the property or assets of such Person, acquired by the Company or any Subsidiary
and  existing at the time of such  acquisition  (or by any  extension,  renewal,
replacement,  refinancing, modification or restatement of any such agreement, so
long as it does not impose any more restrictive restriction or condition), which
restrictions  or conditions (A) are not applicable to any Person or the property
or assets of any Person  other than the Person or the property or assets of such
Person  so  acquired  and (B)  were not put in  place  in  anticipation  of such
acquisition  and (iv) the foregoing  clause (c) shall not apply to  restrictions
and conditions  arising or agreed to in the ordinary course of business (A) that
restrict in a customary  manner the  subletting,  assignment  or transfer of any
property or asset that is a lease,  license,  conveyance  or contract or similar
type of  property  or asset or (B) that  exists by virtue  of any  transfer  of,
agreement to transfer, option or right with respect to, or Lien on, any property
or assets of the Company or any  Subsidiary  not  otherwise  prohibited  by this
Agreement  and, in each case,  that do not,  individually  or in the  aggregate,
detract  from  the  value  of the  property  or  assets  of the  Company  or any
Subsidiary in any manner material to the Company an its Subsidiaries, taken as a
whole.

  The  Company  will not permit the  Leverage  Ratio to exceed  2.50 to 1 at any
time.

 . The Company  will not permit the  Interest  Coverage  Ratio to be less than or
equal to 3.00 to 1 as at the last day of each fiscal quarter of the Company.

 .  The Company will not permit Tangible Net Worth to be less than $500,000,000 
 at any time.


                                  ARTICLE VIII

                                Events of Default

      If any of the following events ("Events of Default") shall occur:
      (a)  any Borrower shall fail to pay any principal of any Loan or the 
Company  shall  fail to pay any  reimbursement  obligation  in respect of any LC
Disbursement  when and as the same shall become due and payable,  whether at the
due date thereof or at a date fixed for prepayment thereof or otherwise;

      (b) any Borrower  shall fail to pay any interest on any Loan or any fee or
any other  amount  (other  than an  amount  referred  to in  clause  (a) of this
Article) payable under this Agreement, when and as the same shall become due and
payable, and such failure shall continue unremedied for a period of five days;

      (c) any  representation or warranty made or deemed made by or on behalf of
any Credit Party in or in  connection  with this  Agreement or any  amendment or
modification hereof, or in any report, certificate, financial statement or other
document  furnished  pursuant to or in  connection  with this  Agreement  or any
amendment  or  modification  hereof,  shall prove to have been  incorrect in any
material respect when made or deemed made;

      (d) the  Company  or any  Subsidiary  Borrower  shall  fail to  observe or
perform any  covenant,  condition or  agreement  contained in Section 6.03 (with
respect to any Borrower's existence) or 6.08 or in Article VII;

      (e) the Company shall fail to observe or perform any  covenant,  condition
or agreement  contained in this Agreement (other than those specified in clauses
(a) through (d),  inclusive,  of this Article),  and such failure shall continue
unremedied for a period of 30 days after notice thereof from the  Administrative
Agent (given at the request of any Lender) to the Company;

      (f) the Company or any Subsidiary  shall fail to make any payment (whether
of principal or interest and regardless of amount) in respect of Indebtedness of
the  Company  or any  Subsidiary  in an  aggregate  principal  amount  exceeding
$10,000,000 (other than under this Agreement), when and as the same shall become
due and payable (after giving effect to any applicable grace period);

      (g) any event or condition  occurs that W results in any  Indebtedness  of
the  Company  or any  Subsidiary  in an  aggregate  principal  amount  exceeding
$10,000,000  (other  than  under  this  Agreement)  becoming  due  prior  to its
scheduled  maturity or (ii) after giving effect to any applicable  grace period,
enables or permits the holder or holders of any such Indebtedness or any trustee
or agent on its or their behalf to cause any such Indebtedness to become due, or
to require the prepayment,  repurchase,  redemption or defeasance thereof, prior
to its  scheduled  maturity;  provided  that this  clause (g) shall not apply to
secured  Indebtedness  that  becomes  due as a result of the  voluntary  sale or
transfer of the property or assets securing such Indebtedness;

      (h)  an  involuntary  proceeding  shall  be  commenced  or an  involuntary
petition shall be filed seeking W liquidation, reorganization or other relief in
respect  of the  Company  or any  Material  Subsidiary  or  its  debts,  or of a
substantial part of its assets, under any Federal,  state or foreign bankruptcy,
insolvency,  receivership  or similar law now or hereafter in effect or (ii) the
appointment  of a receiver,  trustee,  custodian,  sequestrator,  conservator or
similar official for the Company or any Material Subsidiary or for a substantial
part of its assets,  and, in any such case,  such  proceeding or petition  shall
continue undismissed for 60 days or an order or decree approving or ordering any
of the foregoing shall be entered;

      (i) the Company or any Material Subsidiary shall (i) voluntarily  commence
any proceeding or file any petition seeking liquidation, reorganization or other
relief under any Federal, state or foreign bankruptcy, insolvency,  receivership
or similar law now or hereafter in effect,  (ii) consent to the  institution of,
or fail to  contest  in a timely  and  appropriate  manner,  any  proceeding  or
petition described in clause (h) of this Article,  (iii) apply for or consent to
the appointment of a receiver, trustee, custodian, sequestrator,  conservator or
similar official for the Company or any Material Subsidiary or for a substantial
part of its assets, (iv) file an answer admitting the material  allegations of a
petition filed against it in any such proceeding,  (v) make a general assignment
for the  benefit  of  creditors  or (vi)  take any  action  for the  purpose  of
effecting any of the foregoing;

      (j)  the Company or any Material Subsidiary shall admit in writing that it
is unable to pay its debts as they become due;

      (k) one or more judgments for the payment of money in an aggregate  amount
in excess of $5,000,000 shall be rendered against the Company, any Subsidiary or
any combination  thereof and the same shall remain  undischarged for a period of
30 consecutive days during which execution shall not be effectively  stayed,  or
any action shall be legally taken by a judgment  creditor to attach or levy upon
any assets of the Company or any Subsidiary to enforce any such judgment;

      (1) an ERISA  Event  shall  have  occurred  that,  in the  opinion  of the
Required  Lenders,  when taken  together  with all other ERISA  Events that have
occurred,  could  reasonably be expected to result in a Material Adverse Effect;
or

(m)   a Change in Control shall occur;

then,  and in every such event (other than an event with respect to any Borrower
described in clause (h) or W of this Article), and at any time thereafter during
the continuance of such event, the Administrative  Agent may, and at the request
of the Required Lenders shall, by notice to the Company,  take either or both of
the  following  actions,  at the same or  different  times:  (i)  terminate  the
Commitments, and thereupon the Commitments shall terminate immediately, and (ii)
declare the Loans then  outstanding  to be due and payable in whole (or in part,
in which case any principal not so declared to be due and payable may thereafter
be declared to be due and payable),  and thereupon the principal of the Loans so
declared to be due and payable,  together with accrued  interest thereon and all
fees and other obligations of the Borrowers accrued hereunder,  shall become due
and payable immediately, without presentment, demand, protest or other notice of
any kind,  all of which are hereby waived by the  Borrowers;  and in case of any
event with respect to any Borrower described in clause (h) or W of this Article,
the  Commitments  shall  automatically  terminate and the principal of the Loans
then outstanding,  together with accrued interest thereon and all fees and other
obligations of the Borrowers accrued hereunder,  shall automatically  become due
and payable,  without presentment,  demand, protest or other notice of any kind,
all of which are hereby waived by the Borrowers.


                                   ARTICLE IX

                            The Administrative Agent

      Each of the Lenders and the Issuing Bank hereby  irrevocably  appoints the
Administrative  Agent as its agent and  authorizes the  Administrative  Agent to
take such actions on its behalf and to exercise  such powers as are delegated to
the  Administrative  Agent by the terms  hereof,  together with such actions and
powers as are reasonably incidental thereto.

      The bank serving as the Administrative Agent hereunder shall have the same
rights  and  powers in its  capacity  as a Lender as any  other  Lender  and may
exercise the same as though it were not the Administrative  Agent, and such bank
and its Affiliates may accept deposits from, lend money to and generally  engage
in any kind of business with the Company or any  Subsidiary  or other  Affiliate
thereof as if it were not the Administrative Agent hereunder.

      The  Administrative  Agent shall not have any duties or obligations except
those  expressly  set forth  herein.  without  limiting  the  generality  of the
foregoing (a) the Administrative  Agent shall not be subject to any fiduciary or
other  implied  duties,  regardless  of whether a Default  has  occurred  and is
continuing,  (b) the  Administrative  Agent  shall not have any duty to take any
discretionary action or exercise any discretionary  powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent is
required  to  exercise  in writing by the  Required  Lenders,  and (c) except as
expressly set forth herein, the Administrative  Agent shall not have any duty to
disclose,  and shall not be liable for the failure to disclose,  any information
relating to the Company or any Subsidiary that is communicated to or obtained by
the  bank  serving  as  Administrative  Agent  or any of its  Affiliates  in any
capacity.  The Administrative  Agent shall not be liable for any action taken or
not taken by it with the consent or at the request of the Required Lenders or in
the absence of its own gross negligence or wilful misconduct. The Administrative
Agent  shall be deemed not to have  knowledge  of any  Default  unless and until
written notice thereof is given to the Administrative  Agent by the Company or a
Lender,  and the  Administrative  Agent shall not be responsible for or have any
duty to ascertain or inquire into (i) any statement,  warranty or representation
made  in or in  connection  with  this  Agreement,  (ii)  the  contents  of  any
certificate,  report or other  document  delivered  hereunder  or in  connection
herewith,  (iii)  the  performance  or  observance  of  any  of  the  covenants,
agreements  or other terms or conditions  set forth  herein,  (iv) the validity,
enforceability,  effectiveness  or  genuineness  of this  Agreement or any other
agreement,  instrument or document, or (v) the satisfaction of any condition set
forth in Article V or elsewhere  herein,  other than to confirm receipt of items
expressly required to be delivered to the Administrative Agent.

      The  Administrative  Agent shall be  entitled to rely upon,  and shall not
incur any liability for relying upon, any notice, request, certificate, consent,
statement,  instrument,  document or other writing  believed by it to be genuine
and to have been signed or sent by the proper Person. The  Administrative  Agent
also may rely upon any statement  made to it orally or by telephone and believed
by it to be made by the proper  Person,  and shall not incur any  liability  for
relying thereon.  The  Administrative  Agent may consult with legal counsel (who
may be counsel for the Company and its  Subsidiaries),  independent  accountants
and other  experts  selected by it, and shall not be liable for any action taken
or  not  taken  by it in  accordance  with  the  advice  of  any  such  counsel,
accountants or experts.

      The  Administrative  Agent may perform any and all its duties and exercise
its rights and powers by or through any one or more sub-agents  appointed by the
Administrative  Agent.  The  Administrative  Agent  and any such  sub-agent  may
perform any and all its duties and exercise its rights and powers  through their
respective  Related  Parties.  The  exculpatory   provisions  of  the  preceding
paragraphs  shall apply to any such sub-agent and to the Related  Parties of the
Administrative Agent and any such subagent,  and shall apply to their respective
activities in connection with the syndication of the credit facilities  provided
for herein as well as activities as Administrative Agent.

      Subject to the  appointment  and acceptance of a successor  Administrative
Agent as provided in this paragraph,  the Administrative Agent may resign at any
time by notifying the Lenders,  the Issuing Bank and the Company.  Upon any such
resignation, the Required Lenders shall have the right, in consultation with the
Company, to appoint a successor. If no successor shall have been so appointed by
the Required  Lenders and shall have  accepted such  appointment  within 30 days
after the retiring  Administrative  Agent gives notice of its resignation,  then
the retiring  Administrative Agent may, on behalf of the Lenders and the Issuing
Bank,  appoint a  successor  Administrative  Agent which shall be a bank with an
office in New York,  New York,  with a combined  capital and surplus of at least
$500,000,000  or an  Affiliate  of any such  bank.  Upon the  acceptance  of its
appointment as  Administrative  Agent  hereunder by a successor,  such successor
shall succeed to and become vested with all the rights,  powers,  privileges and
duties of the  retiring  Administrative  Agent and the  retiring  Administrative
Agent shall be discharged  from its duties and obligations  hereunder.  The fees
payable by the Company to a successor  Administrative Agent shall be the same as
those payable to its predecessor unless otherwise agreed between the Company and
such successor.  After the Administrative  Agent's  resignation  hereunder,  the
provisions  of this Article and Section  10.03 shall  continue in effect for its
benefit in respect  of any  actions  taken or omitted to be taken by it while it
was acting as Administrative Agent.

      Each Lender  acknowledges that it has,  independently and without reliance
upon the  Administrative  Agent,  the Syndication  Agent or any other Lender and
based on such documents and information as it has deemed  appropriate,  made its
own credit analysis and decision to enter into this Agreement.  Each Lender also
acknowledges  that  it  will,   independently  and  without  reliance  upon  the
Administrative  Agent,  the  Syndication  Agent or any other Lender and based on
such documents and  information as it shall from time to time deem  appropriate,
continue to make its own decisions in taking or not taking action under or based
upon this Agreement,  any related agreement or any document furnished  hereunder
or thereunder.

      The Syndication Agent, in its capacity as such, shall have no obligations,
duties or liabilities whatsoever under this Agreement.


                                    ARTICLE X
                       MiscellaneousARTICLE XMiscellaneous
 . Except in the case of notices and other communications  expressly permitted to
be given by telephone,  all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by telecopy, as follows:

      (a)  if to any of the Borrowers, to the Company at 35 Industrial Way, 
Rochester, New Hampshire 03867, Attention of Moya S. Joosten (Telecopy No. 
(603) 337-4566);

      (b)  if to the Administrative Agent, to The Chase Manhattan Bank, Loan 
and Agency Services Group,  One Chase Manhattan  Plaza,  Eighth Floor, New York,
New York 10081, Attention of Janet Belden (Telecopy No. (212) 552-5658),  with a
copy to The Chase  Manhattan  Bank,  999 Broad Street,  Bridgeport,  Connecticut
06604, Attention of David Nackley (Telecopy No. (203) 382-6314); and

      (c) if to any Lender (including in its capacity as Issuing Bank), to it at
its address (or telecopy number) set forth in its Administrative Questionnaire.

Any party hereto may change its address or telecopy number for notices and other
communications  hereunder by notice to the other parties hereto. All notices and
other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.

 .ECTION 10.02. Waivers; AmendmentsSECTION 10.02. Waivers; Amendments

      (a) No failure or delay by the  Administrative  Agent, the Issuing Bank or
any Lender in exercising any right or power  hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any  abandonment  or  discontinuance  of steps to enforce such a right or power,
preclude  any other or further  exercise  thereof or the  exercise  of any other
right or power. The rights and remedies of the Administrative Agent, the Issuing
Bank and the Lenders  hereunder  are  cumulative  and are not  exclusive  of any
rights or remedies that they would otherwise have. No waiver of any provision of
this Agreement or consent to any departure by the Credit Parties therefrom shall
in any event be effective unless the same shall be permitted by paragraph (b) of
this  Section,  and then such waiver or consent  shall be effective  only in the
specific  instance  and for the purpose for which  given.  Without  limiting the
generality  of the  foregoing,  the making of a Loan or  issuance of a Letter of
Credit shall not be construed as a waiver of any Default,  regardless of whether
the Administrative  Agent, any Lender or the Issuing Bank may have had notice or
knowledge of such Default at the time.

      (b) Neither this Agreement nor any provision hereof may be waived, amended
or modified  except  pursuant to an agreement or agreements  in writing  entered
into by the Credit Parties and the Required Lenders or by the Credit Parties and
the Administrative Agent with the consent of the Required Lenders; provided that
no such  agreement  shall (i) increase the  Commitment of any Lender without the
written consent of such Lender,  (ii) reduce the principal amount of any Loan or
LC  Disbursement  or reduce  the rate of  interest  thereon,  or reduce any fees
payable hereunder,  without the written consent of each Lender affected thereby,
(iii) postpone the scheduled date of payment of the principal amount of any Loan
or LC Disbursement,  or any interest thereon, or any fees payable hereunder,  or
reduce  the  amount  of,  waive or excuse  any such  payment,  or  postpone  the
scheduled date of expiration of any  Commitment,  without the written consent of
each Lender  affected  thereby,  (iv) change Section  2.16(b) or (c) in a manner
that would alter the pro rata sharing of payments required thereby,  without the
written  consent of each Lender,  (v) release the Guarantor from its obligations
hereunder,  without the written consent of each Lender or (vi) change any of the
provisions of this Section or the definition of "Required  Lenders" or any other
provision  hereof  specifying  the number or percentage  of Lenders  required to
waive,  amend or modify any rights hereunder or make any  determination or grant
any consent  hereunder,  without the written  consent of each  Lender;  provided
further  that no such  agreement  shall amend,  modify or  otherwise  affect the
rights or duties  of the  Administrative  Agent or the  Issuing  Bank  hereunder
without the prior  written  consent of the  Administrative  Agent or the Issuing
Bank, as the case may be.

SECTION 10.03. Expenses; Indemnity: Damage WaiverSECTION 10.03. Expenses; 
Indemnity: Damage Waiver

      (a) The Company shall pay W all reasonable out-of-pocket expenses incurred
by  the  Administrative  Agent,  the  Syndication  Agent  and  their  respective
Affiliates,  including the reasonable fees, charges and disbursements of counsel
for the  Administrative  Agent, in connection with the syndication of the credit
facilities  provided for herein,  the  preparation  and  administration  of this
Agreement or any amendments,  modifications or waivers of the provisions  hereof
(whether  or not the  transactions  contemplated  hereby  or  thereby  shall  be
consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing
Bank in  connection  with the issuance,  amendment,  renewal or extension of any
Letter  of  Credit  or  any  demand  for  payment   thereunder   and  (iii)  all
out-of-pocket expenses incurred by the Administrative Agent, the Issuing Bank or
any Lender, including the fees, charges and disbursements of any counsel for the
Administrative  Agent or any  Lender,  in  connection  with the  enforcement  or
protection of its rights in connection with this Agreement, including its rights
under this Section,  or in  connection  with the Loans made or Letters of Credit
issued  hereunder,  including in connection with any workout,  restructuring  or
negotiations in respect thereof.

      (b) The Company shall indemnify the Administrative  Agent, the Syndication
Agent,  the Issuing Bank and each Lender,  and each Related  Party of any of the
foregoing Persons (each such Person being called an  ("Indemnitee"),  by payment
to the Administrative Agent for the account of such Lender or any of its Related
Persons,  against,  and hold each Indemnitee  harmless from, any and all losses,
claims, damages,  liabilities and related expenses,  including the fees, charges
and  disbursements  of any counsel for any  Indemnitee,  incurred by or asserted
against any Indemnitee  arising out of, in connection  with, or as a result of W
the  execution  or delivery  of-this  Agreement or any  agreement or  instrument
contemplated  hereby,  the performance by the parties hereto of their respective
obligations  hereunder  or the  consummation  of the  Transactions  or any other
transactions  contemplated  hereby, (ii) any Loan or Letter of Credit or the use
of the proceeds therefrom  (including any refusal by the Issuing Bank to honor a
demand  for  payment  under a Letter  of Credit if the  documents  presented  in
connection with such demand do not strictly comply with the terms of such Letter
of  Credit),  (iii) any actual or  alleged  presence  or  release  of  Hazardous
Materials  on or from any  property  owned or  operated  by the  Company  or any
Subsidiary,  or any Environmental Liability related in any way to the Company or
any  Subsidiary,   or  (iv)  any  actual  or  prospective   claim,   litigation,
investigation or proceeding  relating to any of the foregoing,  whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a
party thereto;  provided that such indemnity shall not, as to any Indemnitee, be
available  to the extent  that such  losses,  claims,  damages,  liabilities  or
related expenses have resulted from the gross negligence or wilful misconduct of
such Indemnitee.

      (c) To the extent that the Company fails to pay any amount  required to be
paid by it to the Issuing  Bank,  the  Syndication  Agent or the  Administrative
Agent (for its own account)  under  paragraph (a) or (b) of this  Section,  each
Lender  severally  agrees to pay to the  Administrative  Agent,  the Syndication
Agent  or the  Issuing  Bank,  as the  case  may be,  such  Lender's  Applicable
Percentage  (determined as of the time that the applicable  unreimbursed expense
or  indemnity  payment is  sought)  of such  unpaid  amount;  provided  that the
unreimbursed  expense or indemnified loss, claim,  damage,  liability or related
expense,  as  the  case  may  be,  was  incurred  by  or  asserted  against  the
Administrative  Agent, the Syndication Agent or the Issuing Bank in its capacity
as such.

      (d) To the extent  permitted by applicable  law, the Credit  Parties shall
not assert, and hereby waive, any claim against any Indemnitee, on any theory of
liability, for special, indirect,  consequential or punitive damages (as opposed
to direct or actual damages)  arising out of, in connection with, or as a result
of, this  Agreement or any  agreement or  instrument  contemplated  hereby,  the
Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.

(e)   All amounts due under this Section shall be payable promptly after written
      demand therefor.

 .ECTION 10.04. Successors and AssignsSECTION 10.04. Successors and Assigns

      (a) The  provisions of this  Agreement  shall be binding upon and inure to
the benefit of the parties  hereto and their  respective  successors and assigns
permitted  hereby  (including  any Affiliate of the Issuing Bank that issues any
Letter of Credit),  except that no Credit Party may assign or otherwise transfer
any of its rights or obligations  hereunder without the prior written consent of
each  Lender (and any  attempted  assignment  or  transfer  by any Credit  Party
without  such  consent  shall  be null and  void).  Nothing  in this  Agreement,
expressed or implied,  shall be construed to confer upon any Person  (other than
the parties hereto,  their  respective  successors and assigns  permitted hereby
(including  any  Affiliate of the Issuing Bank that issues any Letter of Credit)
and, to the extent expressly contemplated hereby, the Related Parties of each of
the  Administrative  Agent,  the  Issuing  Bank and the  Lenders)  any  legal or
equitable right, remedy or claim under or by reason of this Agreement.

      (b) Any Lender may assign to one or more assignees all or a portion of its
rights and obligations  under this Agreement  (including all or a portion of its
Commitment and the Loans at the time owing to it); provided that W except in the
case of an  assignment  to a Lender or an  Affiliate  of a  Lender,  each of the
Company,  the  Administrative  Agent and the Issuing  Bank must give their prior
written  consent to such  assignment  (which  consent shall not be  unreasonably
withheld),  (ii) except in the case of an assignment to a Lender or an Affiliate
of a Lender or an  assignment  of the entire  remaining  amount of the assigning
Lender's  Commitment,  the  amount of the  Commitment  of the  assigning  Lender
subject to each such  assignment  (determined  as of the date the Assignment and
Acceptance  with respect to such  assignment is delivered to the  Administrative
Agent)  shall not be less than  $10,000,000  unless  each of the Company and the
Administrative  Agent otherwise consent,  (iii) each partial assignment shall be
made as an assignment  of a  proportionate  part of all the  assigning  Lender's
rights and obligations under this Agreement, (iv) the parties to each assignment
shall  execute  and  deliver  to the  Administrative  Agent  an  Assignment  and
Acceptance,  together with a processing and recordation  fee of $2,500,  and (v)
the assignee,  if it shall not be a Lender,  shall deliver to the Administrative
Agent an Administrative Questionnaire;  provided further that any consent of the
Company  otherwise  required  under this  paragraph  shall not be required if an
Event of Default  under  clause (h) or (i) of Article  VIII has  occurred and is
continuing.  Upon  acceptance  and  recording  pursuant to paragraph (d) of this
Section,  from and after the effective  date  specified in each  Assignment  and
Acceptance,  the assignee  thereunder shall be a party hereto and, to the extent
of the interest assigned by such Assignment and Acceptance,  have the rights and
obligations  of  a  Lender  under  this  Agreement,  and  the  assigning  Lender
thereunder  shall, to the extent of the interest assigned by such Assignment and
Acceptance,  be released from its obligations  under this Agreement (and, in the
case of an Assignment  and  Acceptance  covering all of the  assigning  Lender's
rights and  obligations  under this  Agreement,  such Lender shall cease to be a
party hereto but shall continue to be entitled to the benefits of Sections 2.13,
2.14,  2.15 and  10.03).  Any  assignment  or  transfer by a Lender of rights or
obligations  under this  Agreement  that does not comply with this paragraph (b)
shall be treated for  purposes of this  Agreement  as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (e) of
this Section.

      (c) The Administrative  Agent,  acting for this purpose as an agent of the
Borrowers,  shall  maintain at one of its offices in The City of New York a copy
of  each  Assignment  and  Acceptance  delivered  to it and a  register  for the
recordation  of the names and addresses of the Lenders,  and the  Commitment of,
and  principal  amount of the Loans and LC  Disbursements  owing to, each Lender
pursuant to the terms hereof from time to time (the "Register").  The entries in
the Register shall be conclusive,  and the Borrowers,  the Administrative Agent,
the Issuing Bank and the Lenders may treat each Person whose name is recorded in
the Register pursuant to the terms hereof as a Lender hereunder for all purposes
of this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Company, the Issuing Bank and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

      (d)  Upon  its  receipt  of a duly  completed  Assignment  and  Acceptance
executed  by an  assigning  Lender and an  assignee,  the  assignee's  completed
Administrative  Questionnaire  (unless the  assignee  shall  already be a Lender
hereunder),  the processing and  recordation fee referred to in paragraph (b) of
this Section and any written  consent to such  assignment  required by paragraph
(b) of this Section,  the Administrative  Agent shall accept such Assignment and
Acceptance  and record the  information  contained  therein in the Register.  No
assignment  shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

      (e) Any Lender may, without the consent of the Company, the Administrative
Agent or the Issuing  Bank,  sell  participations  to one or more banks or other
entities  (a  "Participant")  in all or a portion  of such  Lender's  rights and
obligations  under this Agreement  (including all or a portion of its Commitment
and the Loans owing to it);  provided that (i) such Lender's  obligations  under
this  Agreement  shall remain  unchanged,  (ii) such Lender shall remain  solely
responsible to the other parties hereto for the performance of such  obligations
and (iii) the  Borrowers,  the  Administrative  Agent,  the Issuing Bank and the
other  Lenders  shall  continue to deal solely and directly  with such Lender in
connection with such Lender's rights and obligations  under this Agreement.  Any
agreement or  instrument  pursuant to which a Lender sells such a  participation
shall  provide  that such  Lender  shall  retain the sole right to enforce  this
Agreement and to approve any amendment,  modification or waiver of any provision
of this  Agreement;  provided that such agreement or instrument may provide that
such Lender  will not,  without  the  consent of the  Participant,  agree to any
amendment,  modification  or waiver  described  in the first  proviso to Section
10.02(b)  that  affects  such  Participant.  Subject  to  paragraph  (f) of this
Section,  the  Borrowers  agree that each  Participant  shall be entitled to the
benefits  of  Sections  2.13,  2.14 and 2.15 to the same  extent as if it were a
Lender and had acquired its interest by assignment  pursuant to paragraph (b) of
this Section.

      (f) A  Participant  shall not be entitled  to receive any greater  payment
under Section 2.13 or 2.15 than the  applicable  Lender would have been entitled
to receive with respect to the participation  sold to such  Participant,  unless
the sale of the  participation  to such  Participant  is made with the Company's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender  shall not be entitled to the benefits of Section 2.15 unless the Company
is notified of the  participation  sold to such Participant and such Participant
agrees,  for the benefit of the  Borrowers,  to comply with  Section  2.15(e) as
though it were a Lender.

      (g) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement to secure  obligations of such
Lender,  including any such pledge or assignment to a Federal  Reserve Bank, and
this  Section  shall not apply to any such  pledge or  assignment  of a security
interest;  provided  that no such pledge or  assignment  of a security  interest
shall release a Lender from any of its  obligations  hereunder or substitute any
such assignee for such Lender as a party hereto.

  All covenants,  agreements,  representations and warranties made by the Credit
Parties  herein  and in the  certificates  or  other  instruments  delivered  in
connection  with or pursuant to this Agreement  shall be considered to have been
relied upon by the other  parties  hereto and shall  survive the  execution  and
delivery  of this  Agreement  and the  making of any Loans and  issuance  of any
Letters of Credit,  regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative  Agent, the Issuing
Bank or any Lender may have had notice or  knowledge of any Default or incorrect
representation  or warranty at the time any credit is  extended  hereunder,  and
shall  continue  in full  force and  effect as long as the  principal  of or any
accrued  interest on any Loan or any fee or any other amount  payable under this
Agreement is outstanding  and unpaid or any Letter of Credit is outstanding  and
so long as the  Commitments  have not expired or  terminated.  The provisions of
Sections 2.13,  2.14,  2.15 and 10.03 and Article IX shall survive and remain in
full  force  and  effect  regardless  of the  consummation  of the  transactions
contemplated  hereby,  the repayment of the Loans, the expiration or termination
of the  Letters  of  Credit  and  the  Commitments  or the  termination  of this
Agreement or any provision hereof.

      SECTION 10.06.  Counterparts;  Integration  EffectivenessSECTION  10.06. .
This Agreement may be executed in counterparts  (and by different parties hereto
on different counterparts),  each of which shall constitute an original, but all
of which when taken together shall constitute a single contract.  This Agreement
and  any  separate  letter  agreements  with  respect  to  fees  payable  to the
Administrative  Agent  constitute the entire contract among the parties relating
to the subject  matter hereof and supersede any and all previous  agreements and
understandings,  oral or written,  relating to the subject matter hereof. Except
as provided in Section 5.01, this Agreement shall become effective when it shall
have been executed by the Administrative Agent and when the Administrative Agent
shall have received  counterparts  hereof which,  when taken together,  bear the
signatures of each of the other parties hereto,  and thereafter shall be binding
upon and  inure to the  benefit  of the  parties  hereto  and  their  respective
successors and assigns.  Delivery of an executed counterpart of a signature page
of this  Agreement  by  telecopy  shall be  effective  as delivery of a manually
executed counterpart of this Agreement.

 . Any provision of this Agreement held to be invalid,  illegal or  unenforceable
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of  such  invalidity,  illegality  or  unenforceability  without  affecting  the
validity,  legality and  enforceability of the remaining  provisions hereof; and
the invalidity of a particular provision in a particular  jurisdiction shall not
invalidate  such provision in any other  jurisdiction.  . If an Event of Default
arising  under  clause (a) or (b) of Article  VIII  shall have  occurred  and be
continuing,  each Lender is hereby authorized at any time and from time to time,
to the  fullest  extent  permitted  by law,  to set off  and  apply  any and all
deposits (general or special, time or demand,  provisional or final) at any time
held and  other  indebtedness  at any time  owing by such  Lender  to or for the
credit  or the  account  of the  Credit  Parties  against  any  of and  all  the
obligations of the Credit Parties now or hereafter existing under this Agreement
held by such Lender,  irrespective of whether or not such Lender shall have made
any demand under this Agreement and although such  obligations may be unmatured.
The rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have.

SECTION 10.09. Governing Law; Jurisdiction; Consent to
Service of ProcessSECTION 10.09. Governing Law; Jurisdiction; Consent to Service
of process

(a) This Agreement shall be construed in accordance with and governed by the law
of the State of New York.

      (b) Each Credit Party hereby irrevocably and unconditionally  submits, for
itself and its property,  to the nonexclusive  jurisdiction of the Supreme Court
of the State of New York  sitting in New York  County  and of the United  States
District  Court of the Southern  District of New York,  and any appellate  court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement,  or for  recognition or enforcement of any judgment,  and each of the
parties hereto hereby irrevocably and unconditionally  agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New
York State or, to the extent  permitted by law, in such Federal  court.  Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive  and may be enforced in other  jurisdictions  by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that the  Administrative  Agent, the Issuing Bank or any Lender
may otherwise have to bring any action or proceeding  relating to this Agreement
against any Credit Party or its properties in the courts of any jurisdiction.

      (c) Each Credit Party hereby  irrevocably and  unconditionally  waives, to
the fullest extent it may legally and  effectively do so, any objection which it
may now or  hereafter  have to the  laying  of  venue  of any  suit,  action  or
proceeding arising out of or relating to this Agreement in any court referred to
in paragraph (b) of this Section.  Each of the parties hereto hereby irrevocably
waives,  to the fullest extent  permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.

      (d) Each  party to this  Agreement  irrevocably  consents  to  service  of
process in the manner  provided  for notices in Section  10.01.  Nothing in this
Agreement  will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

 . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL  PROCEEDING  DIRECTLY
OR INDIRECTLY  ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE  TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT,  TORT OR ANY OTHER THEORY). EACH
PARTY  HERETO (A)  CERTIFIES  THAT NO  REPRESENTATIVE,  AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF  LITIGATION,  SEEK TO ENFORCE THE FOREGOING  WAIVER AND (B)
ACKNOWLEDGES  THAT IT AND THE OTHER  PARTIES  HERETO HAVE BEEN  INDUCED TO ENTER
INTO  THIS   AGREEMENT   BY,  AMONG  OTHER  THINGS,   THE  MUTUAL   WAIVERS  AND
CERTIFICATIONS IN THIS SECTION.

 . Article and  Section  headings  and the Table of Contents  used herein are for
convenience  of reference  only,  are not part of this  Agreement  and shall not
affect the construction of, or be taken into consideration in interpreting, this
Agreement.

 . Each of the  Administrative  Agent, the Issuing Bank and the Lenders agrees to
maintain the confidentiality of the Information (as defined below),  except that
Information may be disclosed (a) to its and its Affiliates, directors, officers,
employees and agents,  including  accountants,  legal counsel and other advisors
(it being  understood  that the Persons to whom such  disclosure is made will be
informed of the  confidential  nature of such Information and instructed to keep
such  Information  confidential),  (b) to the extent requested by any regulatory
authority,  (c) to the extent  required by applicable  laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in  connection  with the  exercise of any  remedies  hereunder  or any suit,
action or proceeding  relating to this  Agreement or the  enforcement  of rights
hereunder,  (f) subject to an agreement containing provisions  substantially the
same as those of this  Section,  to any  assignee of or  Participant  in, or any
prospective  assignee  of or  Participant  in, any of its rights or  obligations
under this  Agreement,  (g) with the consent of the Company or (h) to the extent
such  Information  (i) becomes  publicly  available  other than as a result of a
breach of this Section or (ii) becomes  available to the  Administrative  Agent,
the Issuing  Bank or any Lender on a  nonconfidential  basis from a source other
than the Company.  For the  purposes of this  Section,  "Information"  means all
information  received from the Company relating to the Company or any Subsidiary
or their respective business,  other than any such information that is available
to the  Administrative  Agent or any Lender on a nonconfidential  basis prior to
disclosure by the Company.  Any Person required to maintain the  confidentiality
of  Information as provided in this Section shall be considered to have complied
with its  obligation  to do so if such Person has  exercised  the same degree of
care to maintain the  confidentiality  of such  Information as such Person would
accord to its own confidential information.

 . The  Company  may from  time to time  designate  one or more  Subsidiaries  as
Subsidiary  Borrowers  hereunder by  delivering to the  Administrative  Agent an
agreement,  in form and  substance  satisfactory  to the  Administrative  Agent,
pursuant  to which  such  Subsidiary  agrees  to be a party to and bound by this
Agreement,  and  subject  to  the  obligations  of a  "Subsidiary  Borrower",  a
"Borrower" and a "Credit Party"  hereunder.  Any Subsidiary  may, upon notice by
the  Company to the  Administrative  Agent,  withdraw as a  Subsidiary  Borrower
hereunder if no Loans to such Subsidiary  Borrower are outstanding  hereunder or
if any such  Loans  are  repaid  contemporaneously  with such  withdrawal.  Upon
receipt  by the  Administrative  Agent  of such  notice,  each  Lender  shall be
released  from  its  obligations  to make  Loans  to such  Subsidiary  and  such
Subsidiary shall cease to be a "Subsidiary Borrower" hereunder.

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


                     CABLETRON SYSTEMS, INC.


                     by___________________________
                        Name:
                        Title:

                     THE CHASE MANHATTAN BANK,
                     individually and as Administrative Agent


                     by__________________________
                        Name:
                        Title:





<PAGE>


                     THE FIRST NATIONAL BANK OF CHICAGO,
                individually and as Syndication Agent by


                     by___________________________
                        Name:
                        Title:


                     THE BANK OF NEW YORK


                     by__________________________
                                  Name:
                        Title:


                     BANK OF TOKYO-MITSUBISHI TRUST
                COMPANY


                     by_______________________
                        Name:
                        Title:


                     CITIBANK, N.A.


                     by_______________________
                             Name:
                        Title:


                     THE DAI-ICHI KANGYO BANK, LTD.


                     by________________________
                        Name:
                        Title:


                        DEUTSCHE BANK AG, NEW YORK AND/CR
                     CAYMAN ISLANDS BRANCH


                          by_______________________
                             Name:
                             Title:



                          FIRST UNION NATIONAL BANK
                          OF NORTH CAROLINA



                          by_______________________
                             Name:
                             Title:


                        FLEET BANK, NATIONAL ASSOCIATION


                          by________________________
                             Name:
                             Title:


                          NATIONSBANK OF TEXAS, N.A.


                          by________________________
                             Name:
                             Title:


                          THE SAKURA BANK, LIMITED


                          by_________________________
                             Name:
                             Title:


                       STATE STREET BANK AND TRUST COMPANY


                          by________________________
                             Name:
                             Title:



                          WACHOVIA BANK OF GEORGIA, N.A.


                          by______________________
                             Name:
                             Title:



                       BANK OF AMERICA NATIONAL TRUST AND
                          SAVINGS ASSOCIATION


                          by________________________
                             Name:
                             Title:


                          THE BANK OF NOVA SCOTIA


                          by________________________
                             Name:
                             Title:



                         CREDIT LYONNAIS NEW YORK BRANCH


                          by________________________
                             Name:
                             Title:


                        THE FIRST NATIONAL BANK OF BOSTON


                          by_______________________
                             Name:
                             Title:


                          MELLON BANK, N.A.


                          by_______________________
                             Name:
                             Title:




<PAGE>


                             Schedule 2.01
      COMMITMENTS



Lender                                         Commitment

The Chase Manhattan Bank                       $17,500,000.00
The First National Bank of Chicago             $17,500,000.00
The Bank of New York                           $15,000,000.00
Bank of Tokyo-Mitsubishi Trust Company         $15,000,000.00
Citibank, N.A.                                 $15,000,000.00
The Dai-Ichi Kangyo Bank, Ltd.                 $15,000,000.00
Deutsche Bank AG, New York and/or
Cayman Islands Branch                          $15,000,000.00
First Union National Bank
of North Carolina                              $15,000,000.00
Fleet Bank, National Association               $15,000,000.00
NationsBank of Texas, N.A.                     $15,000,000.00
The Sakura Bank, Limited                       $15,000,000.00
State Street Bank and Trust Company            $15,000,000.00
Wachovia Bank of Georgia, N.A.                 $15,000,000.00
Bank of America National Trust and
Savings Association                            $10,000,000.00
The Bank of Nova Scotia                        $10,000,000.00
Credit Lyonnais New York Branch                $10,000,000.00
The First National Bank of Boston              $10,000,000.00
Mellon Bank, N.A.                              $10,000,000.00





<PAGE>


                                   EXHIBIT A



                       [Form of Assignment and Acceptance]

                            ASSIGNMENT AND ACCEPTANCE

      Reference is made to the Credit  Agreement,  dated as of March 7, 1997 (as
modified  and  supplemented  and in  effect  from  time  to  time,  the  "Credit
Agreement"),  between  Cabletron  Systems,  Inc.,  a Delaware  corporation  (the
"Company"),  the  Subsidiary  Borrowers  from time to time  party  thereto,  the
lenders named therein,  The Chase  Manhattan Bank, as  administrative  agent for
such lenders,  and The First  National Bank of Chicago,  as  syndication  agent.
Terms defined in the Credit Agreement are used herein as defined therein.

      _____________________________ the "Assignor") and _________________ (the
"Assignee") agree as follows:

      1. The  Assignor  hereby  irrevocably  sells and  assigns to the  Assignee
without recourse to the Assignor,  and the Assignee hereby irrevocably purchases
and  assumes  from the  Assignor  without  recourse to the  Assignor,  as of the
Effective  Date as set forth in Schedule 1 hereto  (the  "Effective  Date"),  an
interest  (the  "Assigned  Interest")  in  and  to  the  Assignor's  rights  and
obligations  under the Credit  Agreement  with  respect  to the credit  facility
contained in the Credit  Agreement as is set forth on Schedule 1 (the  "Assigned
Facility"), in a principal amount and percentage as set forth on Schedule 1.

      2. The  Assignor  (i) makes no  representation  or warranty and assumes no
responsibility  with respect to any  statements,  warranties or  representations
made in or in connection with the Credit Agreement or any instrument or document
furnished   pursuant   thereto,   or   the   execution,    legality,   validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement or any
instrument or document  furnished  pursuant thereto,  other than that it has not
created any adverse claim upon the interest  being  assigned by it hereunder and
that such interest is free and clear of any such adverse claim and (ii) makes no
representation  or warranty  and assumes no  responsibility  with respect to the
financial  condition of the Company,  any Subsidiary or any other  obligation or
the  performance  or  observance  by the Company or any  Subsidiary or any other
obligor of any of their respective obligations under the Credit Agreement or any
instrument or document furnished pursuant hereto or thereto.

      3. The Assignee (i) represents and warrants that it is legally  authorized
to enter into this Assignment and Acceptance; (ii) confirms that it has received
a copy of the Credit Agreement, together with copies of the financial statements
referred to in Section 4.04 thereof, the financial statements delivered pursuant
to Section 6.01 thereof,  if any, and such other documents and information as it
has deemed  appropriate  to make its own credit  analysis  and decision to enter
into this  Assignment and Acceptance;  (iii) agrees that it will,  independently
and without reliance upon the Assignor,  the  Administrative  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 the Credit  Agreement,  any promissory note or any other instrument
or document furnished  pursuant hereto or thereto;  (iv) appoints and authorizes
the  Administrative  Agent to take such  action as  administrative  agent on its
behalf and to exercise such powers and  discretion  under the Credit  Agreement,
any  promissory  note or any other  instrument  or document  furnished  pursuant
hereto or  thereto as are  delegated  to the  Administrative  Agent by the terms
thereof,  together with such powers as are  incidental  thereto;  and (v) agrees
that it will be bound by the provisions of the Credit Agreement and will perform
in  accordance  with its  terms  all the  obligations  which by the terms of the
Credit Agreement are required to be performed by it as a Lender including, if it
is  organized  under the laws of a  jurisdiction  outside  the United  States of
America,  its obligation  pursuant to Section 2.14(e) of the Credit Agreement to
deliver  the forms  prescribed  by the  Internal  Revenue  Service of the United
States certifying as to the Assignee's  exemption from United States withholding
taxes with respect to all  payments to be made to the Assignee  under the Credit
Agreement,  or such other  documents as are  necessary to indicate that all such
payments are subject to such tax at a rate reduced by an applicable tax treaty.

      4. Following the execution of this Assignment and  Acceptance,  it will be
delivered  to the  Administrative  Agent for  acceptance  and  recording  by the
Administrative  Agent  pursuant  to  Section  10.04  of  the  Credit  Agreement,
effective  as of the  Effective  Date  (which date shall not,  unless  otherwise
agreed to by the Administrative  Agent, be earlier than five Business Days after
the date of such acceptance and recording by the Administrative  Agent and shall
in no  event be  earlier  than the date  the  information  contained  herein  is
recorded in the Register pursuant to Section 10.04 of the Credit Agreement).

      5. Upon such acceptance and recording,  from and after the Effective Date,
the  Administrative  Agent shall make all  payments  in respect of the  Assigned
Interest (including payments of principal,  interest, fees and other amounts) to
the Assignee which accrue subsequent to the Effective Date.

      6. From and after the Effective Date, (i) the Assignee shall be a party to
the  Credit  Agreement  and,  to the  extent  provided  in this  Assignment  and
Acceptance,  have the rights and obligations of a Lender thereunder and shall be
bound by the  provisions  thereof  and (ii) the  Assignor  shall,  to the extent
provided  in this  Assignment  and  Acceptance,  relinquish  its  rights  and be
released from its obligations  under the Credit  Agreement except as provided in
Section 10.05 of the Credit Agreement.

      7.   This Assignment and Acceptance shall be governed by and construed in
accordance with the law of the State of New York.

      8.  This  Assignment  and  Acceptance  may be  executed  in any  number of
counterparts,  all of which taken  together  shall  constitute  one and the same
instrument  and any of the  parties  hereto  may  execute  this  Assignment  and
Acceptance by signing any such counterpart.

      IN WITNESS  WHEREOF,  the parties  hereto have caused this  Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.





<PAGE>



      Schedule I to
                            Assignment and Acceptance
                        relating to the Credit Agreement,
                           dated as of March 7, 1997,
                        between Cabletron Systems, Inc.,
                     the Subsidiary Borrowers party thereto,
                           the lenders named therein,
                            The Chase Manhattan Bank,
                     as administrative agent for the Lenders
                 (in such capacity, the "Administrative Agent"),
                     and The First National Bank of Chicago,
                              as syndication agent

Name of Assignor:
Name of Assignee:
Effective Date of Assignment:

                Principal                      Percentage
               Amount Assigned                 Assigned

           [ASSIGNEE]               [ASSIGNOR]

           By:                      BY:
           Title:                         Title:


                                    [Consented to and] Accepted:
                                    THE CHASE MANHATTAN BANK,
                                    as Administrative Agent


                                    By:
                                    Title:

                                 [Consented to:

                                    CABLETRON SYSTEMS, INC.

                                    By:
[Consented to:

[NAME OF ISSUING BANK]



By:
Title: I






<PAGE>

                                    EXHIBIT B


                                 Form of Opinion
                                       of
                                  Ropes & Gray



                                    _____________, 1997



The Chase Manhattan Bank, as Administrative Agent
Loan and Agency Services Group-
One Chase Manhattan Plaza
New York, New York 10081


The First National Bank of Chicago, as Syndication Agent
One First National Plaza
Chicago, Illinois 60670

Each of the Lenders listed on the signature pages to the Credit Agreement

Ladies and Gentlemen:

     This  opinion is being  furnished  to you  pursuant to Section  5.01 of the
Credit  Agreement  dated as of March _,  1997  (the  "Credit  Agreement")  among
Cabletron  Systems,  Inc., a Delaware  corporation (the 'Company"),  each of the
Lenders listed on the signature  pages  thereto,  The Chase  Manhattan  Bank, as
Administrative  Agent and The First  National  Bank of Chicago,  as  Syndication
Agent.  Terms defined in the Credit  Agreement and not otherwise  defined herein
are used herein with the meanings so defined.

     We have  acted as  counsel to the  Company  in  connection  with the Credit
Agreement.  We have  participated in the preparation of the Credit Agreement and
have examined copies thereof executed by the Company. We have also examined such
Certificates,  documents and records,  and have made such examination of law, as
we have deemed necessary to enable us to render the opinions expressed below. In
addition,  we have  examined  and relied  upon  representations  and  warranties
contained  in the  Credit  Agreement  and in  certificates  delivered  to you in
connection  therewith  as to matters  of fact  (other  than  facts  constituting
conclusions of law).
     We call your attention to the fact that the Credit Agreement  provides that
it is to be governed by the laws of the State of New York and we understand that
you are  relying on the advice of your own counsel  with  respect to all matters
involving  New York law.  For purposes of  rendering  the opinions  expressed in
paragraph 3 below, we have assumed that the Credit Agreement provides that it is
to be governed by and  construed in  accordance  with the  internal  laws of The
Commonwealth  of  Massachusetts.  The  opinions  expressed  below are limited to
matters governed by the laws of The Commonwealth of  Massachusetts,  the General
Corporation  Law of the State of  Delaware  and the  federal  laws of the United
States.

Based on the foregoing, we are of the opinion that:

      1. The Company is a corporation  duly organized,  validly  existing and in
good standing  under the laws of the State of Delaware,  with  corporate  powers
adequate for the execution, delivery and performance of the Credit Agreement and
for carrying on the business now  conducted by it as described in the  Company's
Annual Report on Form 10-K for the year ended February 29, 1996.

     2. The Credit Agreement, including the borrowings by the Company thereunder
and the  incurrence  by the Company of liability in respect of Letters of Credit
thereunder,  has been duly authorized by all necessary  corporate  action on the
part of the Company.

     3. [Each of) the Credit  Agreement  [and the Notes  being  delivered  today
under the Credit  Agreement] has been duly executed and delivered by the Company
and (subject to the qualifications  stated in the penultimate  paragraph hereof)
is a legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms.

     4. The execution and delivery of the Credit  Agreement by the Company,  and
the compliance by the Company with the terms of the Credit  Agreement,  will not
result in any violation of, or be in conflict  with,  any terms or provision of:
(a) its charter or bylaws or (b) any presently existing federal or Massachusetts
law, statute or governmental regulation.

     5. Under  existing  provisions of law, no approval of or  authorization  or
other action by any federal or Massachusetts  governmental authority is required
to be obtained  by the Company in  connection  with the  execution,  delivery or
performance of the Credit Agreement.

     6. Neither the Company nor any  Subsidiary of the Company is an "investment
company" as defined in, or subject to regulation  under, the Investment  Company
Act of 1940 or a  "holding  company"  as defined  in, or  subject to  regulation
under, the Public Utility Holding Company Act of 1935.

     7. To our  knowledge,  after having made inquiry of the Company but without
having  investigated  any  governmental  records or court  dockets,  there is no
governmental  action or proceeding and no litigation pending against the Company
which places in question the validity or  enforceability  of, or seeks to enjoin
the performance of, the Credit Agreement.

     Our  opinion  that  each of the  Credit  Agreement  [and  the  Notes  being
delivered  today under the Credit  Agreement]  is the legal,  'valid and binding
obligation of the Company,  enforceable in accordance with its terms, is subject
to (i) bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting  the rights and  remedies of  creditors,  (ii) general  principles  of
equity,  regardless of whether applied in,  proceedings in equity or at law, and
(iii) the fact that the enforcement of the indemnity provisions contained in the
Credit Agreement may be limited by applicable  federal or state securities laws.
We express no  opinion as to (i) the effect of the laws of any  jurisdiction  in
which any Under is located (other than The Commonwealth of  Massachusetts)  that
limit the interest,  fees or other charges such Lender may impose,  (ii) Section
3.06 or the second  sentence  of Section  2.16(c) of the Credit  Agreement,  and
(iii) Section 10.09(c) of the Credit Agreement,  insofar as such Section relates
to the subject matter  jurisdiction  of the United States District Court for the
Southern  District  of New York to  adjudicate  any  controversy  related to the
Credit Agreement.

The foregoing  opinion is solely for your  benefit,  and for the benefit of such
other Lenders as may from time to time become  parties to the Credit  Agreement,
and all  participants  in or assignees of the Loans pursuant to Section 10.04 of
the Credit Agreement, and may not be relied on by any other Person.


                                Very truly yours,



                                  Ropes & Gray