SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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


                                    FORM 10-Q


                QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


                         Commission file number 1-10994

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


                  For the quarterly period ended March 31, 1998



                        PHOENIX INVESTMENT PARTNERS, LTD.



              DELAWARE                                 95-4191764
      (State of Incorporation)            (I.R.S. Employer Identification No.)


56 Prospect St., Hartford, Connecticut  06115-0480   (860) 403-7667
(Address of principal executive offices)     (Registrant's telephone number)


                        PHOENIX DUFF & PHELPS CORPORATION
                                  (Former name)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No ___


On April 30, 1998, the registrant had 44,008,044 shares of $.01 par value common
stock outstanding.



                                       
<PAGE>



               PHOENIX INVESTMENT PARTNERS, LTD. AND SUBSIDIARIES

                          Quarter Ended March 31, 1998

                                      Index

<TABLE>
<CAPTION>

PART I   -   FINANCIAL INFORMATION:

<S>        <C>                                                        <C>
                                                                      Page
  Item 1.  Consolidated Financial Statements:

           Consolidated Condensed Statements of Financial Condition.    3
              March 31, 1998 and December 31, 1997

           Consolidated Statements of Income .......................    4
              Three Months Ended March 31, 1998 and
              Three Months Ended March 31, 1997

           Consolidated Condensed Statements of Cash Flows .........    5
              Three Months Ended March 31, 1998 and
              Three Months Ended March 31, 1997

           Notes to the Consolidated Financial Statements...........    6


  Item 2.  Management's Discussion and Analysis of:

           Results of Operations and Financial Condition............   11

           Liquidity and Capital Resources..........................   15

           Impact of the Year 2000 Issue............................   15

           Safe Harbor Statement Under the Private Securities Litigation
           Reform Act of 1995.......................................   16


PART II   -   OTHER INFORMATION:


  Item 4.  Submission of Matters to a Vote of Security Holders......   17

  Item 6.  Exhibits and Reports on Form 8-K.........................   17

  Signatures........................................................   18


</TABLE>



                                       2
<PAGE>


PART  I. Financial Information
 Item 1. Consolidated Financial Statements


               Phoenix Investment Partners, Ltd. and Subsidiaries
            Consolidated Condensed Statements of Financial Condition
                                 (in thousands)
<TABLE>
<CAPTION>
                                                          (Unaudited)
                                                          March 31, December 31,
                                                              1998       1997
<S>                                                        <C>        <C> 
Assets
Current Assets
 Cash and cash equivalents                                 $  17,005  $ 21,872
 Marketable securities, at market                             11,320    12,000
 Accounts receivable                                          34,857    31,537
 Prepaid expenses and other current assets                     3,162     2,712
                                                           ---------  --------
   Total current assets                                       66,344    68,121

Deferred commissions                                           3,838     3,998
Furniture, equipment and leasehold improvements, net           9,916    10,071
Goodwill and intangible assets, net                          462,673   468,117
Investment in Beutel, Goodman & Company Ltd.                  29,752    29,884
Long-term investments and other assets                        24,271    24,758
                                                           ---------  --------
   Total assets                                            $ 596,794  $604,949
                                                           =========  ========

Liabilities and Stockholders' Equity
Current Liabilities
 Accounts payable and other accrued liabilities            $  23,250  $ 25,742
 Payables to related parties                                   4,928     3,135
 Broker-dealer payable                                         8,230     9,157
 Short-term notes payable                                                5,853
 Current portion of long-term debt                             2,247     2,241
                                                           ---------  --------
   Total current liabilities                                  38,655    46,128

Deferred taxes, net                                           64,864    66,020
Long-term debt, net of current portion                         2,531     2,682
Credit facility                                              185,000   185,000
Lease obligations and other long-term liabilities              6,192     6,617
                                                           ---------  --------
   Total liabilities                                         297,242   306,447
                                                           ---------  --------

Minority Interest                                                822       976
                                                           ---------  --------

Series A Convertible Exchangeable Preferred Stock             78,915    78,827
                                                           ---------  --------

Stockholders' Equity
Common stock, $.01 par value, 100,000,000 shares
 authorized, 44,382,098 and 44,295,261 shares issued,
 and 43,943,098 and 43,950,261 shares outstanding                444       444
Additional paid-in capital                                   189,055   188,566
Retained earnings                                             23,215    21,624
Accumulated other comprehensive income                        10,431    10,674
Treasury stock, at cost, 439,000 and 345,000 shares           (3,330)   (2,609)
                                                           ---------  --------
   Total stockholders' equity                                219,815   218,699
                                                           ---------  --------
   Total liabilities and stockholders' equity              $ 596,794  $604,949
                                                           =========  ========

</TABLE>


        The accompanying notes are an integral part of these statements.


                                       3
<PAGE>


               Phoenix Investment Partners, Ltd. and Subsidiaries
                        Consolidated Statements of Income
                      (in thousands, except per share data)
<TABLE>
<CAPTION>

                                                               (Unaudited)
                                                    Three months ended March 31,
                                                             1998        1997
<S>                                                        <C>        <C>
Revenues
Investment management fees                                 $  45,654  $ 28,844
Mutual funds - ancillary fees                                  6,154     5,821
Other income and fees                                            649     1,221
                                                           ---------  --------
   Total revenues                                             52,457    35,886
                                                           ---------  --------

Operating Expenses
Employment expenses                                           22,731    15,497
Other operating expenses                                      11,524     8,200
Restructuring charges                                            168
Depreciation and amortization of
  leasehold improvements                                         913       641
Amortization of goodwill and intangible assets                 5,504     2,365
Amortization of deferred commissions                             340     1,702
                                                           ---------  --------
   Total operating expenses                                   41,180    28,405
                                                           ---------  --------

Operating Income                                              11,277     7,481
                                                           ---------  --------

Equity in Earnings of Unconsolidated Affiliates                1,026      (934)
                                                           ---------  --------

Other Income (Expense) - Net                                     418      (229)
                                                           ---------  --------

Interest (Expense) Income - Net
Interest expense                                              (2,952)     (240)
Interest income                                                  395       293
                                                           ---------  --------
   Total interest (expense) income - net                      (2,557)       53
                                                           ---------  --------

Income to Minority Interest                                     (488)

Income Before Income Taxes                                     9,676     6,371
Provision for income taxes                                     4,251     2,612
                                                           ---------  --------

Net Income                                                     5,425     3,759
Series A preferred stock dividends                             1,190     1,185
                                                           ---------  --------
Income available to common stockholders                        4,235     2,574

Other Comprehensive Income, Net of Tax
Foreign currency translation adjustment                          192      (197)
Unrealized (losses) gains on securities available-for-sale      (435)      477
                                                           ---------  -------- 
   Total other comprehensive income                             (243)      280
                                                           ---------  --------
Comprehensive Income                                       $   3,992  $  2,854
                                                           =========  ========

Weighted average shares outstanding
   Basic                                                      43,936    44,055
   Diluted                                                    44,530    44,597

Earnings per share
   Basic                                                   $     .10  $    .06
   Diluted                                                 $     .10  $    .06

 </TABLE>
      The accompanying notes are an integral part of these statements.


                                       4
<PAGE>


               Phoenix Investment Partners, Ltd. and Subsidiaries
                 Consolidated Condensed Statements of Cash Flows
                                 (in thousands)
<TABLE>
<CAPTION>

                                                               (Unaudited)
                                                    Three months ended March 31,
                                                             1998        1997
<S>                                                      <C>           <C>
Cash Flows from Operating Activities:
  Net income                                             $  5,425      $ 3,759
   Adjustments to reconcile net income to net cash
   provided by operating activities:
    Depreciation and amortization of
      leasehold improvements                                  913          641
    Amortization of goodwill and intangible assets          5,504        2,365
    Amortization of deferred commissions                      340        1,702
    Income to minority interest                               488
    Equity in earnings of unconsolidated
      affiliates, net of dividends                            300          934
    Payments of deferred commissions                         (180)      (2,836)
    Changes in other operating assets                      (3,937)      (1,637)
    Changes in other operating liabilities                 (2,960)       2,657
                                                         --------      -------
   Net cash provided by operating activities                5,893        7,585
                                                         --------      -------

Cash Flows from Investing Activities:
  Sale (purchase) of marketable securities, net               847          (47)
  Repayment of short-term notes from acquisition           (5,853)
  Capital expenditures                                       (758)        (598)
  Distributions to minority interests                        (643)
  Purchase of long-term investments                          (408)      (2,220)
  Other investing activities                                  179         (418)
  Proceeds from long-term investments                                   11,246
                                                         --------      -------
   Net cash (used in) provided by investing activities     (6,636)       7,963
                                                         --------      -------

Cash Flows from Financing Activities:
  Repayment of debt, net                                     (146)      (6,500)
  Dividends paid                                           (3,834)      (3,828)
  Stock repurchases                                          (721)      (1,245)
  Proceeds from issuance of stock                             577        1,155
                                                         --------      -------
   Net cash used in financing activities                   (4,124)     (10,418)
                                                         --------      -------

Net (decrease) increase in cash and cash equivalents       (4,867)       5,130
Cash and cash equivalents, beginning of period             21,872       22,466
                                                         --------      -------
Cash and Cash Equivalents, End of Period                 $ 17,005      $27,596
                                                         ========      =======

</TABLE>

          The accompanying notes are an integral part of these statements.


                                       5
<PAGE>


               Phoenix Investment Partners, Ltd. and Subsidiaries
                 Notes to the Consolidated Financial Statements
                                   (Unaudited)

1. Basis of Presentation

   The  unaudited   consolidated  financial  statements  of  Phoenix  Investment
   Partners, Ltd. and Subsidiaries (PXP or the Company), formerly Phoenix Duff &
   Phelps Corporation, included herein have been prepared in accordance with the
   instructions  to the Quarterly  Report on Form 10-Q pursuant to the rules and
   regulations of the Securities and Exchange  Commission.  Certain  information
   and footnote  disclosures  normally included in financial statements prepared
   in  accordance  with  generally  accepted  accounting  principles  have  been
   condensed  or omitted.  It is  suggested  that these  consolidated  financial
   statements be read in  conjunction  with the financial  statements  and notes
   included  in the  Company's  Annual  Report on Form  10-K for the year  ended
   December 31, 1997.

2. Recent Accounting Pronouncements

   PXP  adopted  Statement  of  Financial  Accounting  Standard  (SFAS) No. 130,
   "Reporting  Comprehensive  Income,"  as of January 1,  1998.  This  statement
   establishes  standards for the reporting and display of comprehensive  income
   and its  components  in a full set of financial  statements.  This  statement
   requires  that the  reporting  of  comprehensive  income items be reported as
   separate  components of income on the Consolidated  Statements of Income, and
   as a separate component of equity on the Consolidated  Condensed Statement of
   Financial Condition. (See Note 5.)

   SFAS No.  131,  "Disclosures  about  Segments  of an  Enterprise  and Related
   Information,"  is effective  for fiscal years  beginning  after  December 15,
   1997.  This statement  requires the disclosure of different types of business
   activities and economic  environments  of an enterprise,  as they relate to a
   specific  segment.  These disclosures are not required for interim periods in
   the initial year.

   As these statements only address financial statement disclosure, they have no
   impact on PXP's financial results.

3. First Quarter 1998 Compared to Pro Forma First Quarter 1997

   On July 17,  1997,  PXP  acquired a 74.9%  majority  interest  in  GMG/Seneca
   Capital Management LLC (Seneca),  a San  Francisco-based  investment advisor,
   for approximately  $37.5 million. On September 3, 1997, PXP acquired Pasadena
   Capital Corporation (PCC), the parent company of Roger Engemann & Associates,
   Inc., for approximately $214.0 million.  Since PXP's financial statements for
   the first  quarter of 1997 do not reflect the  operations  of PCC and Seneca,
   management  believes  that, for  comparative  purposes,  the most  meaningful
   financial presentation for the first quarter of 1997 is on a pro forma basis.

   The following financial information for the three months ended March 31, 1998
   reflects  actual results for the quarter.  The following pro forma  financial
   information  for the three  months  ended March 31, 1997 is derived  from the
   historical  financial  statements of PXP, PCC and Seneca, and gives effect to
   the  acquisitions  of PCC and a majority  interest in Seneca by PXP.  The pro
   forma  financial  statement  information  has been  prepared  assuming  these
   acquisitions  were  effected  on  January  1,  1997 and does not  necessarily
   reflect the actual results that would have been obtained had the acquisitions
   taken effect on the aforementioned assumed date.



                                       6
<PAGE>
<TABLE>
<CAPTION>


                                                 Three months ended March 31,
                                                1998 - Actual1997 - Pro Forma
                                        (In thousands, except per share amounts)

    <S>                                            <C>            <C>      
    Revenues                                       $  52,457      $  52,120
                                                   ---------      ---------
    Employment expenses                               22,731         21,045
    Other operating expenses                          12,945         15,236
    Amortization of goodwill and
     intangible assets                                 5,504          5,504
                                                   ---------      ---------
    Operating income                                  11,277         10,335
    Other income (expense) - net                       1,444         (1,163)
    Interest expense - net                            (2,557)        (2,758)
    Income to minority interest                         (488)          (290)
                                                   ---------      ---------
    Income before income taxes                         9,676          6,124
    Provision for income taxes                         4,251          2,963
                                                   ---------      ---------
    Net income                                     $   5,425      $   3,161
                                                   =========      =========

    Earnings per share
      Basic                                        $     .10      $     .04
      Diluted                                      $     .10      $     .04
</TABLE>

4. Dividends and Other Capital Transactions

   On May 7,  1998,  the  Company's  Board of  Directors  approved  a  quarterly
   dividend of $.06 per common share,  payable June 10, 1998, to stockholders of
   record on May 29,  1998.  A dividend  on the Series A  Convertible  Preferred
   Stock  (Preferred  Stock)  was also  declared  in the  amount  of  $.098  per
   preferred share,  payable May 15, 1998, to stockholders of record on April 2,
   1998. This preferred dividend represents the final payment of the 6% dividend
   on the Preferred  Stock for the period prior to the April 3, 1998 exchange of
   the Preferred Stock for the Company's 6% Convertible  Subordinated Debentures
   (Debentures). Interest began accruing on the Debentures beginning on April 4,
   1998 and will be payable on June 10, 1998 to registered holders as of May 20,
   1998. (See Note 7.)

   As of March  31,  1998,  the  Company,  in  accordance  with  the  previously
   announced  stock  repurchase  program,  had purchased  439,000  shares of PXP
   common stock at a total cost of $3.3 million.

5. Comprehensive Income

   The components of, and related tax effects for,  other  comprehensive  income
   are as follows for the periods ended March 31, (in thousands):
<TABLE>
<CAPTION>

    1998                                                     Tax
                                             Before-Tax   (Expense)   Net-of-Tax
                                               Amount      Benefit      Amount

    <S>                                       <C>         <C>         <C>    
    Foreign currency translation adjustment   $   325     $ (133)     $   192
    Unrealized losses on securities
      available-for-sale:
      Unrealized holding losses arising
        during period                            (737)       302         (435)
                                              -------     ------      ------- 
    Other comprehensive income               $   (412)   $   169      $   243)
                                             ========    =======      ========
</TABLE>



                                       7
<PAGE>


<TABLE>
<CAPTION>

    1997                                                     Tax
                                              Before-Tax  (Expense)  Net-of-Tax
                                                Amount     Benefit     Amount
    <S>                                       <C>         <C>         <C>

    Foreign currency translation adjustment   $   (334)   $     137   $   (197)
                                              --------    ---------   --------
    Unrealized gains on securities
      available-for-sale:
      Unrealized holding gains arising
       during period                               381         (156)       225
      Plus: reclassification adjustment
        for losses realized in net income          427         (175)       252
                                             ---------     --------   --------
    Net unrealized gains                           808         (331)       477
                                             ---------     --------   --------
    Other comprehensive income               $     474     $   (194)  $    280
                                             =========     ========   ========


   The  following  tables  summarize   accumulated  other  comprehensive  income
   balances (in thousands):

    As of March 31, 1998:                                           Accumulated
                                              Foreign   Unrealized     Other
                                              Currency   Gains on  Comprehensive
                                               Items    Securities     Income

    Balance as of December 31, 1997        $   (1,171) $   11,845  $     10,674
    Current period change                         192        (435)         (243)
                                            ----------  ----------  -----------
    Balance as of March 31, 1998           $     (979) $   11,410  $     10,431
                                           ==========  ==========  ============


    As of December 31, 1997:                                        Accumulated
                                              Foreign   Unrealized     Other
                                              Currency   Gains on  Comprehensive
                                               Items    Securities     Income

    Balance as of December 31, 1996        $     (330) $    4,932  $      4,602
    Current period change                        (841)      6,913         6,072
                                           ----------  ----------  ------------
    Balance as of December 31, 1997        $   (1,171) $   11,845  $     10,674
                                           ==========  ==========  ============
</TABLE>

6. Earnings Per Share

   For the periods  ended March 31, 1998 and March 31,  1997,  basic and diluted
   earnings  per share  (EPS) were  computed  in  accordance  with SFAS No. 128,
   "Earnings per Share." Basic EPS is computed by dividing  income  available to
   common   stockholders  by  the  weighted  average  number  of  common  shares
   outstanding for the period. Diluted EPS is computed by dividing net income by
   the weighted average number of common stock equivalent shares outstanding for
   the period, with the exception that common stock equivalents, and the related
   earnings  effect,  are  ignored  if  they  are  anti-dilutive.  Common  stock
   equivalents  are  computed  based on  outstanding  stock  options  under  the
   non-qualified  stock option plans and the  conversion  of preferred  stock to
   common stock.




                                       8
<PAGE>


   The  following  tables  reconcile  PXP's basic  earnings per share to diluted
   earnings per share:

<TABLE>
<CAPTION>
                                    For the Three Months Ended March 31, 1998
                                                                Per-Share
                                        Income        Shares      Amount
                                           (in thousands)
    <S>                                 <C>           <C>         <C>

    Net income                          $ 5,425
    Less: preferred stock dividends       1,190

    Basic EPS
    Income available to common
      stockholders                        4,235       43,936      $  .10
                                                                  ======

    Effect of Dilutive Securities
    Stock options                                        594

    Diluted EPS
    Income available to common
      stockholders and assumed
      conversions                       $ 4,235       44,530      $  .10
                                        =======       ======      ======


                                      For the Three Months Ended March 31, 1997
                                                                 Per-Share
                                        Income         Shares      Amount
                                           (in thousands)

    Net income                          $ 3,759
    Less: preferred stock dividends       1,185

    Basic EPS
    Income available to common
      stockholders                        2,574       44,055      $  .06
                                                                  ======

    Effect of Dilutive Securities
    Stock options                                        542

    Diluted EPS
    Income available to common
      stockholders and assumed
      conversions                       $ 2,574       44,597      $  .06
                                        =======       ======      ======

</TABLE>

   In  accordance  with SFAS No. 128, the  computation  of diluted  earnings per
   share,  and the respective  weighted  average  diluted  shares,  excludes the
   effect  of the  Preferred  Stock  since,  for the  periods  presented,  these
   securities are anti-dilutive. Had the Preferred Stock not been anti-dilutive,
   the weighted average diluted shares for the three months ended March 31, 1998
   and 1997 would have been 54.7 million and 54.5 million, respectively.



                                       9
<PAGE>


7. Subsequent Events

   During the first quarter of 1998, PXP's Board of Directors voted to authorize
   the exchange of the 3.2 million shares of Preferred  Stock for 6% Convertible
   Subordinated  Debentures,  due 2015. The exchange  occurred on April 3, 1998.
   Holders of outstanding  Preferred  Stock as of the exchange date received the
   $25.00  principal  amount  of  the  Convertible  Subordinated  Debentures  in
   exchange  for each share of  Preferred  Stock,  including  unpaid and accrued
   dividends.

   On  May 7,  1998,  at the  Annual  Meeting  of  Stockholders,  the  Company's
   stockholders  voted  to  change  the  Company's  corporate  name  to  Phoenix
   Investment  Partners,  Ltd. A Certificate of Amendment to the  Certificate of
   Incorporation was filed with the State of Delaware effective May 11, 1998.



                                       10
<PAGE>


              Phoenix Investment Partners, Ltd. and Subsidiaries


Item 2.  Management's Discussion and Analysis of Results of Operations and
Financial Condition

Results of Operations

Assets Under Management

At March 31, 1998, PXP had $49.3 billion of assets under management, an increase
of $2.9 billion from  December 31, 1997,  and $16.3 billion from March 31, 1997.
The increase from March 31, 1997 is primarily the result of the  acquisitions of
Pasadena  Capital  Corporation  (PCC),  on  September  3,  1997,  and a majority
interest in Seneca  Capital  Management  LLC (Seneca),  on July 17, 1997,  which
increased  assets under  management by $11.9 billion as of March 31, 1998. Since
the  revenues of the Company are  substantially  earned  based upon assets under
management, this information is important to an understanding of the business.
<TABLE>
<CAPTION>

                                            (in millions)
                                                    Historical     Pro Forma
                          March 31,   December 31,   March 31,     March 31,
                            1998          1997         1997          1997

<S>                     <C>           <C>           <C>           <C>      
Open-end Mutual Funds   $    14,085   $    13,001   $  10,987     $  11,766
Managed Accounts  *           6,315         5,559         240         4,543
Closed-end Mutual Funds       3,373         3,336       2,878         2,878
Institutional Accounts **    17,207        16,155      12,020        15,691
PHL General Account           8,324         8,351       6,845         6,845
                        -----------   -----------   ---------     ---------
                        $    49,304   $    46,402   $  32,970     $  41,723
                        ===========   ===========   =========     =========
</TABLE>

*  Managed Accounts  represent assets which are individually  managed for retail
   and institutional clients.
** Institutional  Accounts  include 100% of the assets managed by Seneca Capital
   Management.

Three Months Ended March 31, 1998 Compared with Three Months Ended March 31,
1997 - Historical

Revenues  for the three  months  ended  March 31, 1998 of $52.5  million,  which
includes  $18.8 million for PCC and Seneca,  increased  $16.6 million (46%) from
$35.9  million  for the same  period in 1997.  Excluding  the effects of PCC and
Seneca,  the  Company's  revenues  for the three  months  ended  March 31,  1998
decreased $2.3 million (6%) compared to the same period in 1997.

Investment management fees of $45.7 million for the three months ended March 31,
1998,  which includes $16.9 million for PCC and Seneca,  increased $16.8 million
(58%) as compared to $28.8 million for the same period in 1997.  Management fees
earned from the open-end  mutual funds,  including  institutional  mutual funds,
increased  $.5 million due to an increase in average  assets  under  management.
Management  fees  earned  from  managing  Phoenix  Home  Life  Mutual  Insurance
Company's  (PHL)  general  account  increased  $.3 million as a result of a $1.5
billion increase in average assets under management offset, in part, by a change
in the fee structure.  Management fees earned from  closed-end  mutual funds and
PHL sponsored  variable products  increased $.8 million primarily as a result of
an  increase  in  average  assets  under  management.   Institutional   accounts
management fees decreased $1.0 million due to a decrease in average assets under
management.  Funds under reimbursement,  a reduction to revenues,  increased $.7
million due to the  addition of several new funds in the latter part of 1997 for
which the advisors,  subsidiaries  of the Company,  agreed to waive or reimburse
expenses to the extent they exceeded limits detailed in the funds' prospectuses.



                                       11
<PAGE>


Mutual  funds - ancillary  fees of $6.2 million for the three months ended March
31, 1998,  which  includes  $1.8 million for PCC,  increased $.3 million (6%) as
compared  to $5.8  million  for the same period in 1997.  Fund  accounting  fees
earned on open-end mutual funds and PHL sponsored  variable  products  increased
$.3  million  primarily  as a result of an  increase  in  average  assets  under
management. Net distributor fees decreased $1.7 million primarily as a result of
the sale of the  deferred  commissions  asset  in the  second  quarter  of 1997.
Shareholder service agent fees decreased $.1 million as a result of a decline in
mutual fund shareholder accounts.

Other  income and fees of $.6 million for the three months ended March 31, 1998,
which  includes $.1 million of  contingent  deferred  sales charge (CDSC) income
from the  Phoenix-Engemann B share mutual funds,  decreased $.6 million (47%) as
compared to $1.2 million for the same period in 1997, due to reduced CDSC income
resulting from the sale of the Company's deferred commissions asset.

Employment  expenses of $22.7 million for the three months ended March 31, 1998,
which includes $6.4 million for PCC and Seneca,  increased $7.2 million (47%) as
compared to $15.5  million for the same period in 1997. An increase in incentive
compensation  of $.9  million  is the  result  of  hiring  additional  portfolio
managers  and  research  analysts,  as  well  as  an  increase  in  sales  based
incentives.  The  resignation  and retirement of two key executives in the first
and second quarters of 1997, respectively,  decreased employment expenses in the
first  quarter of 1998 by $.5  million.  The  remaining  increase in  employment
expense  is the result of an  expansion  of the sales  force and  annual  salary
adjustments.

Other  operating  expenses of $11.5 million for the three months ended March 31,
1998,  which  includes $2.6 million for PCC and Seneca,  increased  $3.3 million
(41%) as compared to $8.2 million for the same period in 1997.  Other  operating
expenses  increased  by $.2 million as a result of charges paid to a third party
administrator  related to the  outsourcing  of  substantially  all of PXP's fund
accounting  operations  in the first  quarter  of 1998.  The use of  consultants
increased other operating expenses by $.3 million.

Restructuring  charges of $.2 million for the three  months ended March 31, 1998
are the result of the Company's decision to out-source  substantially all of its
fund accounting operations effective in the first quarter of 1998.

Depreciation and  amortization of leasehold  improvements of $.9 million for the
three  months  ended  March 31,  1998,  which  includes  $.2 million for PCC and
Seneca,  increased  $.3  million  (42%) from $.6  million for the same period in
1997. An increase in  depreciation  expense of $.1 million is related to capital
assets purchased in 1997.

Amortization  of goodwill  and  intangible  assets of $5.5 million for the three
months ended March 31, 1998  increased  $3.1 million  (133%) as compared to $2.4
million  for the same  period  in 1997 as a result  of the  amortization  of the
intangible  assets and goodwill  identified in the  preliminary  purchase  price
allocation of PCC and Seneca.

Amortization  of deferred  commissions of $.3 million for the three months ended
March 31, 1998, which includes $.3 million related to  Phoenix-Engemann  B share
mutual funds,  decreased  $1.4 million (80%) as compared to $1.7 million for the
same  period in 1997  primarily  as a result of the sale of PXP's then  existing
deferred  commissions  asset in the second quarter of 1997, which eliminated the
amortization charge.

Operating  income of $11.3  million  for the three  months  ended March 31, 1998
increased  $3.8 million (51%) as compared to $7.5 million for the same period in
1997 as a result of the changes discussed above.



                                       12
<PAGE>


Equity in earnings of  unconsolidated  affiliates  of $1.0 million for the three
months ended March 31, 1998  increased $2.0 million as compared to $(.9) million
for the same period in 1997.  PXP's share of equity earnings from WCCBO was zero
in the first  quarter  of 1998  compared  to a $1.5  million  loss for the first
quarter of 1997, due to the  liquidation of WCCBO in early 1997.  PXP's share of
equity earnings from Greystone  Financial Group was zero in the first quarter of
1998  compared to a $.2 million loss in the first  quarter of 1997.  Income from
the investment in BG increased $.1 million.

Other  income - net of $.4 million for the three  months  ended March 31,  1998,
which includes $.3 million for PCC and Seneca, increased $.6 million as compared
to $(.2)  million  for the same  period in 1997.  Realized  gains on the sale of
marketable securities contributed $.2 million to other income.

Interest expense - net of $2.6 million for the three months ended March 31, 1998
increased $2.6 million (100%) as compared to net interest  income of $.1 million
for the  same  period  in  1997,  due to  interest  charges  resulting  from the
financing of the PCC and Seneca acquisitions.

Income to minority  interest of $.5 million for the three months ended March 31,
1998  represents the minority  shareholders'  interest in the equity earnings of
Seneca, which is fully consolidated in the Company's financial statements.

The  effective  tax  rate of 44% for the  three  months  ended  March  31,  1998
increased  from 41% for the same period in 1997.  The increase in the  effective
tax rate represents the effect of non-deductible goodwill amortization resulting
from the PCC acquisition.

As a result of the  effects  discussed  above,  net income for the three  months
ended  March 31, 1998 of $5.4  million  represents  an increase of $1.7  million
(44%) compared to the $3.8 million for the first quarter of 1997.


Three Months Ended March 31, 1998 Compared with Three Months Ended March 31,
1997 - Pro Forma
(see Note 3)

Revenues of $52.5  million for the three months  ended March 31, 1998  increased
$.3 million  (1%) as compared to pro forma $52.1  million for the same period in
1997.

Investment management fees of $45.7 million for the three months ended March 31,
1998  increased  $2.6  million  (6%) from pro forma  $43.0  million for the same
period in 1997.  Management fees from PCC increased  approximately  $2.0 million
due to an increase in assets under  management and increased asset  performance.
Management fees earned from closed-end  mutual funds and PHL sponsored  variable
products  increased $.8 million  primarily as a result of an increase in average
assets under management.  Management fees earned from the open-end mutual funds,
including  institutional mutual funds,  increased $.5 million due to an increase
in average  assets  under  management.  Management  fees earned  managing  PHL's
general account  increased $.3 million as a result of a $1.5 billion increase in
average  assets  under  management  offset,  in  part,  by a  change  in the fee
structure.  Management  fees  earned  from  advisory  and  subadvisory  accounts
decreased  fees by a net of $.3  million  as a  result  of lost  accounts  being
slightly in excess of new accounts.  Funds under  reimbursement,  a reduction to
revenues, increased $.7 million, due to the addition of various new funds in the
latter part of 1997 for which the advisors,  subsidiaries of the Company, agreed
to waive or reimburse  expenses to the extent they exceeded  limits  detailed in
the funds' prospectuses.

Mutual  funds - ancillary  fees of $6.2 million for the three months ended March
31, 1998  decreased  $1.3 million (17%) from pro forma $7.5 million for the same
period in 1997.  Net  distributor  fees  decreased  $1.2 million  primarily as a
result of the sale of the  deferred  commissions  asset.  Fund  accounting  fees
earned on open-end mutual funds and PHL sponsored  variable  products  increased
$.3  million  primarily  as a result of an  increase  in  average  assets  under
management.  Shareholder service agent fees decreased $.1 million as a result of
a decline in mutual fund shareholder accounts.
Other ancillary fees decreased $.3 million.



                                       13
<PAGE>


Other  income and fees of $.6 million for the three  months ended March 31, 1998
decreased  $1.0 million (62%) from pro forma $1.6 million for the same period in
1997.  A decrease of $.6 million is  primarily  due to a decrease in  redemption
income  as a  result  of  the  sale  of the  Company's  then  existing  deferred
commissions asset in June 1997. Other income from PCC decreased $.4 million.

Employment  expenses of $22.7  million for the three months ended March 31, 1998
increased  $1.7 million (8%) as compared to pro forma $21.0 million for the same
period in 1997.  This  increase is  primarily  due to an  expansion of the sales
force, an increase in sales-based and performance-based  incentive  compensation
and  annual  salary  adjustments.  The  resignation  and  retirement  of two key
executives  in the first and second  quarters of 1997,  respectively,  decreased
employment expenses in the first quarter of 1998 by $.5 million.

Other  operating  expenses of $12.9 million for the three months ended March 31,
1998 decreased $2.3 million (15%) as compared to pro forma $15.2 million for the
same period in 1997. Amortization of deferred commissions decreased $1.5 million
primarily as a result of the sale of the Company's  deferred  commissions asset,
excluding  PCC's,  in  June  1997.   Operating   expenses  from  PCC,  including
professional  fees and travel,  decreased  $.8 million.  The use of  consultants
increased other  operating  expenses by $.3 million.  Other  operating  expenses
increased  by  $.2  million  as a  result  of  charges  paid  to a  third  party
administrator  related to the  outsourcing  of  substantially  all of PXP's fund
accounting  operations  in the  first  quarter  of 1998.  Restructuring  charges
increased $.2 million also as a result of the outsourcing of  substantially  all
of PXP's fund accounting  operations in the first quarter of 1998.  Depreciation
and  amortization of leasehold  improvements  decreased by $.1 million.  Various
other expenses decreased by $.6 million.

Amortization  of goodwill and  intangibles  of $5.5 million for the three months
ended March 31, 1998 was the same as pro forma 1997.

Other  income - net of $1.4  million for the three  months  ended March 31, 1998
increased  $2.6  million as  compared to pro forma  $(1.2)  million for the same
period in 1997. Equity income from the Company's  investment in BG increased $.1
million. PXP's share of equity earnings from WCCBO was zero in the first quarter
of 1998  compared to a $1.5 million loss for the first  quarter of 1997,  due to
the  liquidation  of WCCBO in early 1997.  PXP's share of equity  earnings  from
Greystone  Financial  Group was zero in the first  quarter of 1998 compared to a
$.2 million loss in the first quarter of 1997. Other  miscellaneous  income from
Seneca increased $.3 million.

Interest expense - net of $2.6 million for the three months ended March 31, 1998
decreased  $.2 million  (7%) as compared to pro forma $2.8  million for the same
period in 1997 primarily as a result of a decrease in total outstanding debt.

Income to minority  interest of $.5 million for the three months ended March 31,
1998  increased  $.2 million  (68%) as compared to pro forma $.3 million for the
same period in 1997. The minority  shareholders' interest in the equity earnings
of Seneca,  which is fully consolidated in the Company's  financial  statements,
increased  due to Seneca's  increased  earnings for the three months ended March
31, 1998.

Net income of $5.4 million for the three months ended March 31, 1998 reflects an
increase of $2.3  million  (72%) as  compared to pro forma $3.2  million for the
same  period in 1997,  resulting  from the effects of the  increased  income and
expenses  discussed above. The effective tax rate decreased to 44% for the three
months ended March 31, 1998 from 48% for the same period in 1997.



                                       14
<PAGE>


Liquidity and Capital Resources

The  Company's  business  is not  considered  to be capital  intensive.  Working
capital  requirements  for  the  Company  have  historically  been  provided  by
operating  cash flow. It is expected that such cash flows will continue to serve
as the principal source of working capital for the Company for the near future.

The  Company's  current  capital  structure,  as of May 13, 1998,  includes 43.9
million shares of common stock and $79.4 million of 6% Convertible  Subordinated
Debentures with a principal value of $25.00 per debenture.  The current dividend
rate on common stock is $.06 per share per quarter. If the dividend rate remains
constant  for  1998,  the  total  annual  dividend  on  common  stock  would  be
approximately $10.5 million based upon shares outstanding at March 31, 1998. The
total  annual  interest   expense  on  the  debentures   based  upon  debentures
outstanding at March 31, 1998, at an interest rate of 6%, would be $4.8 million.

The Company has a bank credit  agreement in place  providing  for a $200 million
five year  credit  facility,  with no  required  principal  repayments  prior to
maturity in August 2002. The outstanding  obligation  under the credit agreement
at March 31, 1998 was $185 million.  An interest rate of approximately  5.9% was
in effect on this borrowing as of March 31, 1998. The credit agreement  contains
financial   and  operating   covenants   including,   among  other   provisions,
requirements  that the Company  maintain  certain  financial  ratios and satisfy
certain financial tests, restrictions on the ability to incur indebtedness,  and
limitations on the amount of the Company's  capital  expenditures.  At March 31,
1998, the Company was in compliance  with all covenants  contained in the credit
agreement. The Company believes that funds from operations and amounts available
under the Credit Agreement will provide  adequate  liquidity for the foreseeable
future.

Management considers the liquidity of the Company to be adequate to meet present
and anticipated needs.

Impact of the Year 2000 Issue

The Year 2000 Issue is the result of computer  programs  being written using two
digits rather than four to define the applicable  year. There is the possibility
that some or all of a  company's  computer  programs  that  have  date-sensitive
software  may  recognize a date using "00" as the year 1900 rather than the year
2000.

Based upon preliminary  assessments,  the Company has determined that it will be
required  to modify or replace  portions of its  software  so that its  computer
systems will properly  utilize dates beyond December 31, 1999. Since many of the
core  systems  of  the  Company's  business  are  investment  related,   Company
management  believes  that the  majority of these  systems are already Year 2000
compliant. The Company believes that with modifications to existing software and
conversions  to new  software,  the Year 2000  Issue  will be  mitigated.  It is
anticipated  that such  modifications  and  conversions  will be  completed on a
timely  basis.  The  failure  to  recognize  the Year 2000 could have a negative
impact on, but is not limited to, the handling of securities trades, the pricing
of securities and the servicing of client accounts. It is not known at this time
if there  could be a material  impact on the  operations  of the Company if such
modifications and conversions are not completed timely.

The Company will utilize both internal and external  resources to reprogram,  or
replace, and test the software for Year 2000 modifications.  Certain systems are
already in the process of being  converted due to previous  Company  initiatives
and it is expected that all core applications will be remediated by December 31,
1998 and tested by June, 1999. The total cost to the Company to become Year 2000
compliant is not expected to have a material impact on the Company's  results of
operations.



                                       15
<PAGE>


Safe Harbor Statement Under the Private Securities Litigation Reform Act of
1995

This quarterly report contains forward looking statements that involve risks and
uncertainties  including,  but not  limited  to, the  following:  The  Company's
performance is highly dependent on the amount of assets under management,  which
may decrease for a variety of reasons  including  changes in interest  rates and
adverse  economic  conditions;  the Company's  performance  is very sensitive to
changes in interest rates, which may increase from current levels; the Company's
performance  is  affected  by the demand for and the  market  acceptance  of the
Company's products and services; the Company's business is extremely competitive
with several  competitors being substantially  larger than the Company;  and the
Company's performance may be impacted by changes in the performance of financial
markets and general economic conditions. The costs involved to complete the Year
2000 modifications are based on management's best estimates,  which were derived
based  upon  assumptions  relative  to future  events  including  the  continued
availability  of certain  resources,  third party  modification  plans and other
factors.  There can be no guarantee  that these  estimates  will be achieved and
actual results could differ  materially from those plans.  Specific factors that
might  cause such  material  differences  include,  but are not  limited to, the
availability  and cost of personnel  trained in this area, the ability to locate
and  correct  all  relevant  computer  codes,  and  similar  uncertainties.  The
potential  problems  related to the Year 2000 issue could  affect the ability to
provide  advisory  services  for the  Company's  products.  Accordingly,  actual
results  may  differ  materially  from  those set forth in the  forward  looking
statements.  Attention  is also  directed  to other  risk  factors  set forth in
documents filed by the Company with the Securities and Exchange Commission.




                                       16
<PAGE>


PART II. Other Information

 Item 4. Submission of Matters to a Vote of Security Holders

         No items submitted.

 Item 6. Exhibits and Reports on Form 8-K

     (a) The following documents are filed as part of these reports:

     4(u)Credit  Agreement  dated as of August 14, 1997 among the Registrant and
         various  financial  institutions,  Bank of America  National  Trust and
         Savings Association as Syndication and Documentation Agent, and Bank of
         New York as Administrative Agent.

     (b) Reports on Form 8-K.

         No items filed.









                                       17
<PAGE>


                                  Signatures

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                    Phoenix Investment Partners, Ltd.




May 13, 1998                        /s/ Philip R. McLoughlin
                                    ------------------------
                                    Philip R. McLoughlin, Chairman and
                                    Chief Executive Officer


May 13, 1998                        /s/ William R. Moyer
                                    --------------------
                                    William R. Moyer, Chief Financial Officer




                                       18
<PAGE>


                                                                    EXHIBIT 4(u)



                               CREDIT AGREEMENT

                         Dated as of August 14, 1997

                                    among

                      PHOENIX DUFF & PHELPS CORPORATION,
                  PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY



                        BANK OF AMERICA NATIONAL TRUST
                           AND SAVINGS ASSOCIATION,
                   as Syndication and Documentation Agent,

                            THE BANK OF NEW YORK,
                           as Administrative Agent

                                     and

                THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO


                                 Arranged by


                         BANCAMERICA SECURITIES, INC.

                                     and

                          BNY CAPITAL MARKETS, INC.





<PAGE>

<TABLE>
<CAPTION>


                                TABLE OF CONTENTS
Section                                                                   Page

<S>              <C>                                                        <C>
ARTICLE I        DEFINITIONS                                                 1
                    1.1   Certain Defined Terms                              1
                    1.2   Other Interpretive Provisions                     23
                    1.3   Accounting Principles                             24

ARTICLE II       THE CREDITS                                                24
                    2.1   Amounts and Terms of Commitments                  24
                          (a) The Facility A Credit.                        24
                          (b) The Facility B Credit                         25
                    2.2   Loan Accounts                                     25
                    2.3   Procedure for Borrowing.                          26
                    2.4   Facility B Conversion                             26
                    2.5   Facility A Conversion                             27
                    2.6   Conversion and Continuation Elections             28
                    2.7       Voluntary Termination or Reduction of
                            Commitments                                     29
                    2.8   Optional Prepayments                              30
                          Mandatory Prepayments of Loans;
                          Mandatory Commitment Reductions                   30
                    2.10  Repayment                                         30
                    2.11  Interest                                          31
                    2.12  Fees                                              32
                          (a)   Arrangement, Agency Fees                    32
                          (b)   Commitment Fees                             32
                    2.13  Computation of Fees and Interest                  32
                    2.14  Payments by the Company                           33
                    2.15  Payments by the Banks to the Administrative 
                          Agent                                             33
                    2.16  Sharing of Payments, Etc.                         34

ARTICLE III      TAXES, YIELD PROTECTION AND ILLEGALITY                     35
                    3.1   Taxes.                                            35
                    3.2   Illegality                                        37
                    3.3   Increased Costs and Reduction of
                            Return                                          37
                    3.4   Funding Losses                                    38
                    3.5   Inability to Determine Rates                      39
                    3.6   Certificates of Banks                             39
                    3.7   Survival                                          39

ARTICLE IV       CONDITIONS PRECEDENT                                       39
                    4.1   Conditions of Initial Loans                       39
                          (i)   Credit Agreement                            40
                          (ii)  Resolutions; Incumbency                     40
                          (iii) Organization Documents;
                                  Good Standing                             40
                          (iv)  Legal Opinions                              40
                          (v)   Payment of Fees                             40
                          (vi)  Certificate                                 41
                          (vii) Other Documents                             41
                    4.2   Conditions to All Borrowings and


<PAGE>


Section                                                                   Page

                          Facility B Conversion                             41
                          (a)   Notice of Borrowing/Notice of Facility
                                B Conversion                                41
                          (b)    Continuation of Representations and
                                 Warranties                                 41
                          (c)   No Existing Default                         41
                          (d)   Acquisitions                                42

                    4.3   Conditions to Facility B Conversion               42

ARTICLE V        REPRESENTATIONS AND WARRANTIES                             42
                    5.1   Corporate Existence and Power                     42
                    5.2   Corporate Authorization; No Contravention         43
                    5.3   Governmental Authorization                        43
                    5.4   Binding Effect                                    43
                    5.5   Litigation                                        43
                    5.6   Contractual Obligation                            44
                    5.7   ERISA Compliance                                  44
                    5.8   Use of Proceeds; Margin Regulations               45
                    5.9   Title to Properties                               45
                    5.10  Taxes 45
                    5.11  Financial Condition                               45
                    5.12  Environmental Matters                             46
                    5.13  Regulated Entities                                46
                    5.14  No Burdensome Restrictions                        46
                    5.15  Copyrights, Patents, Trademarks and
                            Licenses, etc.                                  47
                    5.16  Subsidiaries                                      47
                    5.17  Insurance                                         47
                    5.18  Full Disclosure                                   47
                    5.19  PCC Acquisition Agreement                         47
                    5.20  Seneca Acquisition Agreement                      48

ARTICLE VI       AFFIRMATIVE COVENANTS                                      48
                    6.1   Financial Statements                              49
                    6.2   Certificates; Other Information                   50
                    6.3   Notices                                           50
                    6.4    Preservation of Corporate Existence,Etc.         51
                    6.5   Maintenance of Property                           52
                    6.6   Insurance                                         52
                    6.7   Payment of Obligations                            52
                    6.8   Compliance with Laws                              52
                    6.9   Compliance with ERISA                             52
                    6.10  Inspection of Property and Books and
                            Records                                         53
                    6.11  Environmental Laws                                53
                    6.12  Use of Proceeds                                   53
                    6.13  Holding Agreement                                 53

                                           - ii -


<PAGE>


Section                                                                   Page

ARTICLE VII      NEGATIVE COVENANTS                                         54
                    7.1   Limitation on Liens                               54
                    7.2   Mergers, Consolidations and Sales of
                            Assets                                          55
                    7.3   Loans and Investments                             55
                    7.4   Limitation on Indebtedness                        56
                    7.5   Transactions with Affiliates                      56
                    7.6   Use of Proceeds                                   56
                    7.7   Contingent Obligations                            57
                    7.8   Joint Ventures                                    57
                    7.9   Lease Obligations                                 57
                    7.10  Restricted Payments                               58
                    7.11  ERISA                                             58
                    7.12  Change in Business                                58
                    7.13  Accounting Changes                                58
                    7.14  Pari Passu                                        58
                    7.15  Phoenix                                           58
                    7.16  Subordinated Debt and Preferred Stock             58
                    7.17  Capital Expenditures                              59

ARTICLE VIII     GUARANTOR'S FINANCIAL COVENANTS                            59
                    8.1   Guarantor's Minimum Total SAP Adjusted
                           Capital                                          59
                    8.2   Invested Assets                                   59
                    8.3   NAIC Ratings                                      59
                    8.4   Real Estate                                       59
                    8.5   Risk Based Capital                                59
                    8.6   Non-Performing Real Estate                        59
                    8.7   Indebtedness to Capital                           59

ARTICLE IX       COMPANY'S FINANCIAL COVENANTS                              60
                    9.1   Shareholders' Equity                              60
                    9.2   EBITDA to Interest Ratio                          60
                    9.3   Total Debt to Capital Ratio                       60
                    9.4   Senior Debt to EBITDA Ratio                       60

ARTICLE X        GUARANTY                                                   61   
                    10.1  Guaranty                                          61
                    10.2  Guaranty Unconditional                            61
                    10.3  Discharge only upon Payment in Full;
                            Reinstatement in Certain
                            Circumstances                                   62
                    10.4  Waiver by the Guarantor                           62
                    10.5  Subrogation                                       62
                    10.6  Stay of Acceleration                              62

ARTICLE XI       EVENTS OF DEFAULT                                          62
                    11.1  Event of Default                                  62
                          a)    Non-Payment                                 62
                          (b)   Representation or Warranty                  63
                          (c)   Specific Defaults                           63
                          (d)   Other Defaults                              63
                                           - iii -
Section                                                                   Page

                          (e)   Cross-Default                               63
                          (f)   Insolvency; Voluntary Proceedings           63
                          (g)   Involuntary Proceedings                     64
                          (h)   ERISA                                       64
                          (i)   Monetary Judgments                          64
                          (j)   Non-Monetary Judgments                      64
                          (k)   Change of Control                           64
                          (l)   Loss of Licenses                            65

                    11.2  Remedies                                          65
                    11.3  Rights Not Exclusive                              65

ARTICLE XII      GUARANTOR EVENTS OF DEFAULT                                65
                    12.1  Event of Default                                  65
                    12.2  Remedies                                          66

ARTICLE XIII     COMPANY EVENTS OF DEFAULT                                  66
                    13.1  Event of Default                                  66
                    13.2  Remedies                                          66

ARTICLE XIV      THE ADMINISTRATIVE AGENT                                   67
                    14.1  Appointment                                       67
                    14.2  Delegation of Duties                              67
                    14.3  Exculpatory Provisions                            67
                    14.4  Reliance by Administrative Agent                  68
                    14.5  Notice of Default                                 68
                    14.6  Non-Reliance on Administrative Agent
                            and Other Banks.                                69
                    14.7  Indemnification                                   69
                    14.8  Administrative Agent in Its
                            Individual Capacity                             70
                    14.9  Successor Agent                                   71
                    14.10 Syndication and Documentation Agent               71

ARTICLE XV       MISCELLANEOUS  72
                    15.1  Amendments and Waivers                            72
                    15.2  Notices                                           72
                    15.3  No Waiver; Cumulative Remedies                    73
                    15.4  Costs and Expenses                                73
                    15.5  Indemnity                                         74
                    15.6  Payments Set Aside                                74
                    15.7  Successors and Assigns                            75
                    15.8  Assignments, Participations, etc.                 75
                    15.9  Confidentiality                                   77
                    15.10 Set-off                                           78
                    15.11 Automatic Debits of Fees                          78
                    15.12 Notification of Addresses, Lending
                            Offices, Etc.                                   78
                    15.13 Counterparts                                      78
                    15.14 Severability                                      78
                    15.15 No Third Parties Benefited                        79
                    15.16 Governing Law and Jurisdiction                    79
                                           - iv -
Section                                                                   Page

                    15.17  Waiver of Jury Trial                             79
                    15.18         Entire Agreement                          80


</TABLE>



                                      - v -


<PAGE>


Schedule 2.1         Commitments
Schedule 5.5         Litigation
Schedule 5.7         ERISA
Schedule 5.11        Permitted Liabilities
Schedule 5.12        Environmental Matters
Schedule 5.16        Subsidiaries and Minority Interests
Schedule 5.17        Insurance Matters
Schedule 7.1         Permitted Liens
Schedule 7.4         Permitted Indebtedness
Schedule 7.7         Contingent Obligations
Schedule 15.2        Lending Offices; Addresses for Notices



<PAGE>


EXHIBITS

Exhibit A            Form of Notice of Borrowing
Exhibit B            Form of Notice of Conversion/Continuation
Exhibit C            Form of Compliance Certificate
Exhibit D            Form of Legal Opinion of Company's Counsel
Exhibit D-2          Form of Legal Opinion of Guarantor's Counsel
Exhibit E            Form of Assignment and Acceptance
Exhibit F            Form of Promissory Note
Exhibit G            Form of Notice of Facility A Conversion
Exhibit H            Form of Notice of Facility B Conversion






                                     - vi -



<PAGE>


                                CREDIT AGREEMENT


      This CREDIT AGREEMENT is entered into as of August 14, 1997, among Phoenix
Duff & Phelps Corporation a Delaware  corporation (the "Company"),  Phoenix Home
Life Mutual Insurance  Company,  a New York domiciled  mutual insurance  company
(the "Guarantor"), the several financial institutions from time to time party to
this Agreement  (collectively,  the "Banks";  individually,  a "Bank"),  Bank of
America National Trust and Savings Association, as Syndication and Documentation
Agent for the Banks and The Bank of New York,  as  Administrative  Agent for the
Banks.

      WHEREAS,  the  Banks  have  agreed  to make  available  to the  Company  a
revolving  credit  facility  guaranteed  by the  Guarantor  and an  unguaranteed
revolving  credit  facility  upon the  terms  and  conditions  set forth in this
Agreement;

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


                                   I. ARTICLE

                                   DEFINITIONS

      A.    1.1    Certain   Defined  Terms.   The  following   terms  have  the
following meanings:

            "Acquisition"   means  any   transaction   or   series  of   related
      transactions for the purpose of or resulting,  directly or indirectly,  in
      (a) the acquisition of all or substantially all of the assets of a Person,
      or of any  business  or division of a Person,  (b) the  acquisition  of in
      excess of 50% of the capital stock, partnership interests or equity of any
      Person, or otherwise  causing any Person to become a Subsidiary,  or (c) a
      merger or  consolidation  or any other  combination  with  another  Person
      (other than a Person that is a  Subsidiary)  provided  that the Company or
      the Subsidiary is the surviving entity.

            "Administrative  Agent" means BNY in its capacity as  administrative
      agent for the Banks  hereunder,  and any  successor  agent  arising  under
      Section 14.9.

            "Administrative  Agent's  Payment  Office"  means  the  address  for
      payments  set  forth on the  signature  page  hereto  in  relation  to the
      Administrative  Agent, or such other address as the  Administrative  Agent
      may from time to time specify.

            "Affiliate"  means,  as to  any  Person,  any  other  Person  which,
      directly or  indirectly,  is in control of, is controlled  by, or is under
      common  control  with,  such  Person.  A Person shall be deemed to control
      another  Person  if  the  controlling   Person   possesses,   directly  or
      indirectly,  the power to direct or cause the direction of the  management
      and policies of the other Person,  whether through the ownership of voting
      securities, by contract, or otherwise.

            "Agent-Related   Persons"   means  BofA,   BNY  and  any   successor
      Administrative  Agent  arising  under  Section  14.9,  together with their
      respective  Affiliates  (including,  in the  case of  BofA  and  BNY,  the
      Arrangers),   and  the   officers,   directors,   employees,   agents  and
      attorneys-in-fact of such Persons and Affiliates.

           "Agents" mean the  Administrative  Agent and BofA, as Syndication and
      Documentation Agent.

            "Agreement" means this Credit Agreement.

            "Alternate Base Rate" means,  for any day, a rate per annum equal to
      the higher of: (a) 0.50% per annum above the Federal  Funds Rate in effect
      on such date; and (b) the BNY Rate in effect on such day.

            Any  change in the BNY Rate  shall  take  effect at the  opening  of
      business on the day specified in the public announcement of such change.

            "Annual  Statement"  means the  annual  financial  statement  of any
      insurance  company as required to be filed with the  Department,  together
      with all exhibits or schedules  filed  therewith,  prepared in  conformity
      with SAP. References to amounts on particular exhibits,  schedules, lines,
      pages and  columns  on such  Annual  Statements  are based on the  formats
      promulgated by the NAIC for 1996 Annual Statements for the applicable type
      of  insurance  company.  If such format is changed in future years so that
      different  information is contained in such items or they no longer exist,
      it is understood that the reference is to information consistent with that
      recorded  in the  referenced  item in the  1996  Annual  Statement  of the
      insurance company.

            "Applicable Fee Rate" means  initially  0.10%. On and after the date
      specified below, the Applicable Fee Rate shall be adjusted to the rate per
      annum set forth in the table below beneath the consolidated Senior Debt to
      EBITDA  Ratio (such Ratio being  referred to as "X" below) for the Company
      and its Subsidiaries set forth below:


<PAGE>
<TABLE>

 <S>            <C>       <C>           <C>            <C>         <C>
                Level 1   Level 2       Level 3        Level 4     Level 5

 Senior         X <1.4    1.4<X<2.0     2.0<X<2.55     2.55<X<     3.00<X
 Debt                                                  3.00
 EBITDA
 Ratio

 Applicable
 Fee Ratio      8.0 bps   9.0 bps       10.0 bps       12.5 bps    17.5 bps

</TABLE>

      The Applicable Fee Rates shall be adjusted,  to the extent applicable,  60
days (or, in the case of the last fiscal  quarter of any fiscal year,  120 days)
after the end of each fiscal  quarter,  based on the Senior Debt to EBITDA Ratio
as of the last day of such  fiscal  quarter;  it  being  understood  that if the
Company failed to deliver the financial statements required by subsection 6.1(a)
or (b), as applicable, and the related certificate required by subsection 6.2(a)
by the 60th day (or, if applicable, the 120th day) after any fiscal quarter, the
applicable  Fee  Rate  shall be based  on  Level 5 above  until  such  financial
statements and certificate are delivered.

      "Applicable  Margin"  means  initially  as to Facility A  Eurodollar  Rate
Loans, 0.195% and as to Facility A CD Rate Loans, 0.320%.  Concurrently with any
change in the Rating,  the rate set forth below for Facility A  Eurodollar  Rate
Loans and Facility A CD Rate Loans:

<TABLE>

 <S>           <C>        <C>       <C>         <C>       <C>        <C>
 Facility A    Level 1    Level 2   Level 3     Level 4   Level 5    Level 6

 Rating of
 the GuarantorAA/Aa2      Aa-/Aa3   A+/A1       A/A2      A-/A3      <Level 5

 Applicable 0.1875%       0.195%    0.225%      0.250%    0.350%     0.50%
 Margin For
 Eurodollar
 Rate Loans

 Applicable    0.3125%    0.320%    0.350%      0.375%    0.475%     0.625%
 Margin For
 CD Rate
  Loans
</TABLE>

In the event of a split  between  the  Moody's  Rating and the S&P  Rating,  the
higher interest rate shall be applicable.

      "Applicable  Margin"  means  initially  as to Facility B  Eurodollar  Rate
Loans,  0.385%, and as to Facility B CD Rate Loans, 0.51%. On and after the date
specified below,  the Applicable  Margin shall be adjusted to the rate per annum
set forth in the table  below  beneath  the  consolidated  Senior Debt to EBITDA
Ratio  (such  Ratio  being  referred to as "X") below) for the Company set forth
below:

<TABLE>

<S>            <C>       <C>           <C>          <C>             <C>
Facility B     Level 1   Level 2       Level 3      Level 4         Level 5

Senior         X<1.4     1.4<X<2.0     2.0<X<2.55   2.55<X<3.00     3.00<X
Debt
to
EBITDA

Applicable     0.300%    0.360%        0.385%       0.450%          0.550%
Margin for
Eurodollar
Rate

Applicable     0.425%    0.485%        0.510%       0.575%          0.675%
Margin for
CD Rate
Loans
</TABLE>

The  Applicable  Margin for  Facility B Loans shall be  adjusted,  to the extent
applicable,  60 days (or, in the case of the last  fiscal  quarter of any fiscal
year, 120 days) after the end of each fiscal  quarter,  based on the Senior Debt
to EBITDA Ratio as of the last day of such fiscal quarter;  it being  understood
that if the  Company  fails to deliver  the  financial  statements  required  by
subsection 6.1(a) or (b), as applicable, and the related certificate required by
subsection  6.2(a) by the 60th day (or, if applicable,  the 120th day) after any
fiscal quarter, the Applicable Margin shall be based on Level 5 above until such
financial statements and certificate are delivered.

               "Arrangers"  means  BancAmerica  Securities,   Inc.,  a  Delaware
      corporation and BNY Capital Markets, Inc., a New York corporation.

               "Assignee" has the meaning specified in subsection 12.8(a).

               "Attorney Costs" means and includes all fees and disbursements of
      any law firm or other external counsel, the non-duplicative allocated cost
      of internal legal services and all disbursements of internal counsel.

              "Bank"  has  the  meaning  specified  in the  introductory  clause
      hereto.

              "Bankruptcy Code" means the Federal  Bankruptcy Reform Act of 1978
      (11 U.S.C.ss.101, et seq.).

               "Base Rate Loan"  means a Loan that bears  interest  based on the
      Base Rate.



<PAGE>


               "BNY" means The Bank of New York, a New York banking corporation.

               "BNY Rate" means a rate of  interest  per annum equal to the rate
      of interest  publicly  announced in New York City by BNY from time to time
      as  its  prime   commercial   lending  rate,  such  rate  to  be  adjusted
      automatically (without notice) on the effective date of any change in such
      publicly  announced rate. The BNY Rate is not the lowest rate available at
      BNY at any time.

               "BofA"  means  Bank  of  America   National   Trust  and  Savings
      Association, a national banking association.

               "Borrowing"  means a borrowing  hereunder  consisting of Loans of
      the same Type and of the same Facility made to the Company on the same day
      by the Banks under  Article  II, and,  other than in the case of Base Rate
      Loans, having the same Interest Period.

               "Borrowing Date" means any date on which a Borrowing occurs under
      Section 2.3.

               "Business  Day"  means any day other than a  Saturday,  Sunday or
      other day on which  commercial  banks in New York City are  authorized  or
      required by law to close and, if the  applicable  Business  Day relates to
      any Eurodollar  Rate Loan,  means such a day on which dealings are carried
      on in the applicable Eurodollar dollar interbank market.

               "Capital  Adequacy  Regulation"  means any guideline,  request or
      directive  of any central  bank or other  Governmental  Authority,  or any
      other law, rule or regulation,  whether or not having the force of law, in
      each case,  regarding  capital  adequacy of any bank or of any corporation
      controlling a bank.

               "CD Rate" means,  for any Interest Period with respect to CD Rate
      Loans comprising part of the same Borrowing, the rate of interest (rounded
      upward to the next 1/100th of 1%) determined as follows:


               CD Rate =    Certificate of Deposit Rate  + Assessment
                            1.00 - Reserve Percentage             Rate



<PAGE>


           Where:

                 "Assessment  Rate" means,  for any day of such Interest Period,
           the  rate  determined  by the  Administrative  Agent  as equal to the
           annual assessment rate in effect on such day payable to the FDIC by a
           member of the Bank  Insurance  Fund that is  classified as adequately
           capitalized  and within  supervisory  subgroup  "A" (or a  comparable
           successor  assessment  risk  classification  within the meaning of 12
           C.F.R. ss.327.3) for insuring time deposits at offices of such member
           in the  United  States;  or, in the event  that the FDIC shall at any
           time  hereafter  cease  to  assess  time  deposits  based  upon  such
           classifications  or successor  classifications,  equal to the maximum
           annual  assessment  rate in effect on such day that is payable to the
           FDIC by commercial banks (whether or not applicable to any particular
           Bank) for  insuring  time  deposits  at  offices of such banks in the
           United States.

                 "Certificate  of Deposit  Rate" means the rate of interest  per
           annum  determined by the  Administrative  Agent to be the  arithmetic
           mean (rounded upward to the next 1/100th of 1%) of the rates notified
           to the  Administrative  Agent as the rates of interest  bid by two or
           more certificate of deposit dealers of recognized  standing  selected
           by the Administrative  Agent for the purchase at face value of dollar
           certificates  of deposit  issued by major United States banks,  for a
           maturity  comparable to such Interest  Period and in the  approximate
           amount of the CD Rate Loans to be made,  at the time  selected by the
           Administrative Agent on the first day of such Interest Period.

                 "Reserve  Percentage"  means,  for  any  day of  such  Interest
           Period,  the  maximum  reserve  percentage  (expressed  as a decimal,
           rounded  upward to the next  1/100th  of 1%),  as  determined  by the
           Administrative  Agent, in effect on such day (including any ordinary,
           marginal,   emergency,   supplemental,   special  and  other  reserve
           percentages),  prescribed  by the FRB  for  determining  the  maximum
           reserves to be  maintained  by member  banks of the  Federal  Reserve
           System with deposits  exceeding  $1,000,000,000  for new non-personal
           time deposits for a period  comparable to such Interest Period and in
           an amount of $100,000 or more.

           The  CD  Rate  shall  be  adjusted,  as to  all CD  Rate  Loans  then
     outstanding,  automatically  as of the effective  date of any change in the
     Assessment Rate or the Reserve Percentage.

           "CD Rate Loan" means a Loan that bears interest based on the CD Rate.

           "Change of Control" means

           (a) the  acquisition by any Person,  or two or more Persons acting in
     concert,  of beneficial  ownership (within the meaning of Rule 13d-3 of the
     Securities and Exchange  Commission  under the  Securities  Exchange Act of
     1934) of 20% or more of the voting power of the Guarantor; or



<PAGE>


           (b)  the  failure  of  the  Guarantor  to  own  either   directly  or
     indirectly,  free and clear of all Liens or other encumbrances,  51% of the
     outstanding  shares of voting stock and of the capital stock of the Company
     on a fully diluted basis.

     "Closing Date" means the date on which all  conditions  precedent set forth
in  Section  4.1 are  satisfied  or  waived  by all  Banks  (or,  in the case of
subsection 4.1(a)(v), waived by the Person entitled to receive such payment).

    "Code" means the Internal Revenue Code of 1986, and regulations  promulgated
thereunder.

     "Commitment",  as to each Bank,  means its  Facility A  Commitment  and its
Facility B Commitment without duplication.

     "Company  Action  Level"  means  200%  of  the  Authorized   Control  Level
Risk-Based  Capital of the Guarantor.  The Authorized  Control Level  Risk-Based
Capital of the  Guarantor  shall be  computed  in the  manner  from time to time
prescribed by the Insurance Department of the State of New York for inclusion in
the Annual  Statement  of the  Guarantor  of such  Department.  Such  Authorized
Control Level Risk-Based  Capital currently appears on page 23 of such statement
in column 1, line 28.

     "Company  Default" means any event or circumstances  which, with the giving
of notice, the lapse of time, or both, would (if not cured or otherwise remedied
during such time) constitute a Company Event of Default.

    "Company  Event  of  Default"  means  any of  the  events  or  circumstances
specified in Section 13.1.

    "Compliance  Certificate"  means a certificate  substantially in the form of
Exhibit C.

     "Contingent  Obligation"  means,  as to any Person,  any direct or indirect
liability of that Person,  whether or not contingent,  with or without recourse,
(a) with respect to any Indebtedness, lease, dividend, letter of credit or other
obligation  (the  "primary   obligations")   of  another  Person  (the  "primary
obligor"),  including any obligation of that Person (i) to purchase,  repurchase
or otherwise acquire such primary obligations or any security therefor,  (ii) to
advance  or  provide  funds for the  payment or  discharge  of any such  primary
obligation,  or to  maintain  working  capital or equity  capital of the primary
obligor or otherwise to maintain the net worth or solvency or any balance  sheet
item, level of income or financial  condition of the primary  obligor,  (iii) to
purchase property,  securities or services primarily for the purpose of assuring
the owner of any such primary  obligation of the ability of the primary  obligor
to make payment of such primary obligation,  or (iv) otherwise to assure or hold
harmless  the  holder of any such  primary  obligation  against  loss in respect
thereof  (each,  a  "Guaranty  Obligation");  (b)  with  respect  to any  Surety
Instrument  issued for the  account of that Person or as to which that Person is
otherwise liable for reimbursement of drawings or payments;  (c) to purchase any
materials,  supplies  or other  property  from,  or to obtain the  services  of,
another Person if the relevant  contract or other related document or obligation
requires that payment for such  materials,  supplies or other  property,  or for
such services,  shall be made regardless of whether  delivery of such materials,
supplies or other  property is ever made or tendered,  or such services are ever
performed or tendered, or (d) in respect of any Swap Contract. The amount of any
Contingent  Obligation  shall,  in the case of Guaranty  Obligations,  be deemed
equal to the stated or determinable  amount of the primary obligation in respect
of  which  such   Guaranty   Obligation   is  made  or,  if  not  stated  or  if
indeterminable, the maximum reasonably anticipated liability in respect thereof,
and in the case of other Contingent  Obligations,  shall be equal to the maximum
reasonably anticipated liability in respect thereof.

           "Contractual  Obligation"  means, as to any Person,  any provision of
     any  security  issued  by such  Person  or of any  agreement,  undertaking,
     contract, indenture, mortgage, deed of trust or other instrument,  document
     or  agreement  to which such Person is a party or by which it or any of its
     property is bound.

           "Conversion/Continuation Date" means any date on which, under Section
     2.6, the Company (a)  converts  Loans of one Type to another  Type,  or (b)
     continues as Loans of the same Type, but with a new Interest Period,  Loans
     having Interest Periods expiring on such date.

           "Default" means any event or circumstance  which,  with the giving of
     notice,  the  lapse of time,  or both,  would  (if not  cured or  otherwise
     remedied during such time) constitute an Event of Default.

           "Department" means the applicable Governmental Authority of the state
     of domicile of an insurance company  responsible for the regulation of said
     insurance company.

          "Dollars",  "dollars"  and "$" each mean  lawful  money of the  United
     States.

           "EBITDA" means, with respect to the Company and its Subsidiaries,  as
     the end of any fiscal  quarter  for the four  fiscal  quarters  then ending
     earnings before interest, taxes, depreciation and amortization,  calculated
     in accordance with GAAP; provided, that, for any four fiscal quarter period
     in which either the PCC  Acquisition or the Seneca  Acquisition  shall have
     occurred,  EBITDA  shall  be  calculated  on a pro  forma  basis as if such
     acquisition had occurred on the first day of such period.

           "Eligible  Assignee"  means (i) a commercial bank organized under the
     laws of the  United  States,  or any state  thereof,  and having a combined
     capital and surplus of at least  $100,000,000 (or its equivalent in foreign
     currency);  (ii) a commercial  bank  organized  under the laws of any other
     country which is a member of the Organization for Economic  Cooperation and
     Development,  or a political  subdivision of any such country, and having a
     combined capital and surplus of at least $100,000,000 (or its equivalent in
     foreign  currency),  provided that such bank is acting  through a branch or
     agency located in the United  States;  and (iii) a Person that is primarily
     engaged in the business of commercial  banking and that is (A) a Subsidiary
     of a Bank, (B) a Subsidiary of a Person of which a Bank is a Subsidiary, or
     (C) a Person of which a Bank is a Subsidiary.

           "Environmental  Claims" means all claims,  however  asserted,  by any
     Governmental  Authority or other  Person  alleging  potential  liability or
     responsibility  for violation of any  Environmental  Law, or for release or
     injury to the environment.

           "Environmental  Laws"  means  all  federal,   state  or  local  laws,
     statutes,  common law duties,  rules,  regulations,  ordinances  and codes,
     together  with  all  administrative  orders,  directed  duties,   requests,
     licenses,   authorizations   and  permits  of,  and  agreements  with,  any
     Governmental Authorities,  in each case relating to environmental,  health,
     safety and land use matters.

           "ERISA" means the Employee  Retirement  Income  Security Act of 1974,
     and regulations promulgated thereunder.

           "ERISA  Affiliate"  means  any  trade  or  business  (whether  or not
     incorporated)  under common  control with the Company within the meaning of
     Section 414(b) or (c) of the Code (and Sections  414(m) and (o) of the Code
     for purposes of provisions relating to Section 412 of the Code).

           "ERISA Event" means (a) a Reportable  Event with respect to a Pension
     Plan; (b) a withdrawal by the Company or any ERISA Affiliate from a Pension
     Plan  subject to Section 4063 of ERISA during a plan year in which it was a
     substantial  employer  (as  defined  in Section  4001(a)(2)  of ERISA) or a
     cessation of operations which is treated as such a withdrawal under Section
     4062(e) of ERISA;  (c) a complete or partial  withdrawal  by the Company or
     any  ERISA  Affiliate  from a  Multiemployer  Plan or  notification  that a
     Multiemployer  Plan is in  reorganization;  (d) the  filing  of a notice of
     intent to  terminate,  the  treatment of a Plan  amendment as a termination
     under Section 4041 or 4041A of ERISA, or the commencement of proceedings by
     the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) an event or
     condition  which might  reasonably be expected to constitute  grounds under
     Section

<PAGE>


     4042 of ERISA for the  termination  of, or the  appointment of a trustee to
     administer,  any Pension Plan or Multiemployer  Plan; or (f) the imposition
     of any liability under Title IV of ERISA,  other than PBGC premiums due but
     not delinquent  under Section 4007 of ERISA,  upon the Company or any ERISA
     Affiliate.

           "Eurodollar   Rate"  means  with  respect  to  the  Interest   Period
     applicable  to any  Eurodollar  Loan,  a rate of  interest  per  annum,  as
     determined  by the  Administrative  Agent,  obtained by dividing  (and then
     rounding to the nearest  1/16 of 1% or, if there is no nearest  1/16 of 1%,
     then to the next higher 1/16 of 1%):

                 (a) the rate, as reported by BNY to the  Administrative  Agent,
     quoted by BNY to leading  banks in the interbank  eurodollar  market as the
     rate  at  which  BNY  is  offering  Dollar  deposits  in  an  amount  equal
     approximately  to the Eurodollar  Loan of BNY to which such Interest Period
     shall  apply  for a period  equal to such  Interest  Period,  as  quoted at
     approximately  11:00 a.m. two Business  Days prior to the first day of such
     Interest Period, by

                 (b) a number  equal to 1.00  minus  the  aggregate  of the then
     stated   maximum  rates  during  such   Interest   Period  of  all  reserve
     requirements   (including,   without   limitation,   marginal,   emergency,
     supplemental and special reserves),  expressed as a decimal, established by
     the Board of Governors of the Federal  Reserve System and any other banking
     authority to which BNY and other major United States money center banks are
     subject,  in respect of  eurocurrency  funding  (currently  referred  to as
     "Eurocurrency liabilities" in Regulation D of the Board of Governors of the
     Federal  Reserve System) or in respect of any other category of liabilities
     including  deposits by reference to which the interest  rate on  Eurodollar
     Loans is determined or any category of extensions of credit or other assets
     which includes loans by  non-domestic  offices of any Bank to United States
     residents.  Such reserve  requirements shall include,  without  limitation,
     those imposed under such Regulation D. Eurodollar  Loans shall be deemed to
     constitute  Eurocurrency  liabilities  and as such  shall be  deemed  to be
     subject  to such  reserve  requirements  without  benefit  of  credits  for
     proration,  exceptions or offsets which may be available  from time to time
     to any Bank under such  Regulation D. The Eurodollar Rate shall be adjusted
     automatically  on and as of the  effective  date of any  change in any such
     reserve requirement.

           "Eurodollar  Rate Loan" means a Loan that bears interest based on the
     Eurodollar Rate.

          "Event of Default" means any of the events or circumstances  specified
     in Section 11.1.

           "Exchange  Act" means the  Securities  and Exchange Act of 1934,  and
     regulations promulgated thereunder.

           "Facility" means either Facility A or Facility B.

           "Facility A" means the credit  facility  pursuant to which Facility A
     Loans shall be made.

           "Facility A Base Rate Loan" means a Facility A Loan which constitutes
     a Base Rate Loan.

           "Facility A Borrowing" means a Borrowing of Facility A Loans.

           "Facility A CD Rate Loan" means a Facility A Loan which constitutes a
     CD Rate Loan.

          "Facility A Commitment",  as to each Bank,  has the meaning  specified
     in Section 2.1(a).

           "Facility A Conversion"  means a conversion of a Facility B Loan into
     a Facility A Loan as set forth in Section 2.5.

           "Facility  A  Eurodollar  Rate  Loan"  means a  Facility A Loan which
     constitutes an Eurodollar Rate Loan.

           "Facility A Loan" has the meaning specified in Section 2.1(a).

           "Facility B" means the credit  facility  pursuant to which Facility B
     Loans shall be made.

           "Facility B Base Rate Loan" means a Facility B Loan which constitutes
     a Base Rate Loan.

           "Facility B CD Rate Loan" means a Facility B Loan which constitutes a
     CD Rate Loan.

          "Facility B Commitment" as to each Bank, has the meaning  specified in
     Section 2.1(b).

           "Facility B Conversion"  means a conversion of a Facility A Loan into
     a Facility B Loan as set forth in Section 2.1(b).

           "Facility  B  Eurodollar  Rate  Loan"  means a  Facility B Loan which
     constitutes a Eurodollar Rate Loan.

           "Facility B Loan" has the meaning specified in Section 2.1(b).

           "Facility  Conversion  Date"  means any date on which  under  Section
     2.1(b) or Section 2.5, the Company converts a Facility A Loan to a Facility
     B Loan or a Facility B Loan to a Facility A Loan.

           "FDIC"  means the  Federal  Deposit  Insurance  Corporation,  and any
     Governmental Authority succeeding to any of its principal functions.

           "Federal Funds Rate" means,  for any day, a rate per annum (expressed
     as a decimal,  rounded upwards,  if necessary,  to the next higher 1/100 of
     1%) equal to the weighted  average of the rates on overnight  federal funds
     transactions with members of the Federal Reserve System arranged by federal
     funds brokers on such day, as published by the Federal  Reserve Bank of New
     York on the Business Day next succeeding such day, provided that (i) if the
     day for which  such rate is to be  determined  is not a Business  Day,  the
     Federal Funds Rate for such day shall be such rate on such  transactions on
     the next  preceding  Business Day as so  published  on the next  succeeding
     Business  Day, and (ii) if such rate is not so  published  for any day, the
     Federal Funds Rate for such day shall be the average of the  quotations for
     such day on such  transactions  received  by BNY as  determined  by BNY and
     reported to the Administrative Agent.

           "FRB" means the Board of Governors of the Federal Reserve System, and
     any Governmental Authority succeeding to any of its principal functions.

           "GAAP" means generally accepted accounting  principles set forth from
     time  to  time  in  the  opinions  and  pronouncements  of  the  Accounting
     Principles Board and the American Institute of Certified Public Accountants
     and statements and  pronouncements  of the Financial  Accounting  Standards
     Board (or  agencies  with  similar  functions  of  comparable  stature  and
     authority within the U.S. accounting  profession),  which are applicable to
     the circumstances as of the date hereof.

           "Governmental Authority" means any nation or government, any state or
     other political  subdivision thereof, any central bank (or similar monetary
     or  regulatory   authority)  thereof,  any  entity  exercising   executive,
     legislative,   judicial,  regulatory  or  administrative  functions  of  or
     pertaining  to  government,  and any  corporation  or other entity owned or
     controlled,  through stock or capital ownership or otherwise, by any of the
     foregoing.

           "Guarantor  Default" means any event or circumstance  which, with the
     giving  of  notice,  the  lapse of time,  or both,  would  (if not cured or
     otherwise  remedied  during  such time)  constitute  a  Guarantor  Event of
     Default.

          "Guarantor  Event of Default" means any of the events or circumstances
     specified in Section 12.1.

          "Guaranty  Obligation" has the meaning  specified in the definition of
     "Contingent Obligation."

           "Highest  Lawful  Rate"  means as to any Bank,  the  maximum  rate of
     interest,  if any,  that at any time or from time to time may be contracted
     for, taken,  charged or received by such Bank on the obligations owed to it
     under the laws applicable to such Bank and this transaction.

           "Indebtedness"  of any Person  means,  without  duplication,  (a) all
     indebtedness for borrowed money; (b) all obligations issued,  undertaken or
     assumed as the deferred  purchase price of property or services (other than
     trade payables  entered into in the ordinary course of business on ordinary
     terms);  (c) all non-contingent  reimbursement or payment  obligations with
     respect to Surety  Instruments;  (d) all  obligations  evidenced  by notes,
     bonds,   debentures  or  similar  instruments,   including  obligations  so
     evidenced  incurred in connection with the acquisition of property,  assets
     or  businesses(but  not  including  in the case of the  Guarantor,  Surplus
     Notes); (e) all indebtedness  created or arising under any conditional sale
     or other title  retention  agreement,  or incurred as financing,  in either
     case with  respect to  property  acquired  by the Person  (even  though the
     rights and remedies of the seller or bank under such agreement in the event
     of default are limited to repossession  or sale of such property);  (f) all
     obligations  with  respect to capital  leases  (other  than the  $2,600,000
     capital lease related to the National  Securities and Research  Corporation
     transaction);  (g) all net obligations with respect to Swap Contracts;  (h)
     all  indebtedness  referred to in clauses (a) through (g) above  secured by
     (or for  which the  holder  of such  Indebtedness  has an  existing  right,
     contingent  or  otherwise,  to be secured  by) any Lien upon or in property
     (including accounts and contracts rights) owned by such Person, even though
     such  Person  has not  assumed  or become  liable  for the  payment of such
     Indebtedness;  and (i) all Guaranty  Obligations in respect of indebtedness
     or  obligations  of others of the kinds  referred to in clauses (a) through
     (g) above.

           "Indemnified Liabilities" has the meaning specified in Section 15.5.

           "Indemnified Person" has the meaning specified in Section 15.5.

           "Independent Auditor" has the meaning specified in subsection 6.1(a).

           "Insolvency  Proceeding"  means  (a) any case,  action or  proceeding
     before any court or other  Governmental  Authority  relating to bankruptcy,
     reorganization,   insolvency,   liquidation,   receivership,   dissolution,
     winding-up or relief of debtors,  or (b) any  assignment for the benefit of
     creditors,  composition,  marshaling  of assets  for  creditors,  or other,
     similar   arrangement  in  respect  of  its  creditors   generally  or  any
     substantial portion of its creditors;  undertaken under U.S. Federal, state
     or foreign law, including the Bankruptcy Code.

           "Insurance  Code" means with respect to any  insurance  company,  the
     insurance  code at the  state of  domicile  and any  successor  statute  of
     similar  import  together  with the  regulations  thereunder  as amended or
     otherwise modified and in effect from time to time.  References to sections
     of the  Insurance  Code  shall be  construed  to also  refer  to  successor
     sections.

           "Interest Expense" means consolidated interest expense, calculated in
     accordance with GAAP including,  without limitation,  interest expense with
     respect to  Subordinated  Debt;  provided,  however,  that for the one year
     period  commencing  on the date of exchange  or, if earlier,  December  31,
     1997, 50% of the interest  expense related to  Subordinated  Debt exchanged
     for preferred stock  outstanding on the Closing Date shall be excluded from
     Interest Expense.

           "Interest  Payment Date" means, as to any Loan other than a Base Rate
     Loan, the last day of each Interest Period  applicable to such Loan and, as
     to any Base Rate Loan,  the last Business Day of each calendar  quarter and
     each date such  Loan is  converted  into  another  Type of Loan,  provided,
     however,  that if any Interest Period for a CD Rate Loan or Eurodollar Rate
     Loan exceeds 90 days or three months, respectively,  the date that falls 90
     days or three  months  (as the case may be)  after  the  beginning  of such
     Interest Period and after each Interest  Payment Date thereafter is also an
     Interest Payment Date.

           "Interest  Period"  means,  (a) as to any  Eurodollar  Rate Loan, the
     period   commencing  on  the  Borrowing   Date  of  such  Loan  or  on  the
     Conversion/Continuation  Date  on  which  the  Loan  is  converted  into or
     continued  as an  Eurodollar  Rate Loan,  and ending on the date one,  two,
     three or six months  thereafter as selected by the Company in its Notice of
     Borrowing or Notice of  Conversion/Continuation;  and (b) as to any CD Rate
     Loan,  the period  commencing on the Borrowing  Date of such Loan or on the
     Conversion/Continuation  Date  on  which  the  Loan  is  converted  into or
     continued as a CD Rate Loan, and ending 30, 60, 90 or 180 days  thereafter,
     as  selected  by the  Company  in its  Notice  of  Borrowing  or  Notice of
     Conversion/Continuation;

     provided that:

                 (i) if any Interest Period would otherwise end on a day that is
           not a Business  Day,  that  Interest  Period shall be extended to the
           following  Business  Day unless,  in the case of an  Eurodollar  Rate
           Loan,  the result of such  extension  would be to carry such Interest
           Period into  another  calendar  month,  in which event such  Interest
           Period shall end on the preceding Business Day;
                 (ii) any Interest Period  pertaining to an Eurodollar Rate Loan
           that begins on the last Business Day of a calendar month (or on a day
           for which there is no numerically  corresponding  day in the calendar
           month  at the end of such  Interest  Period)  shall  end on the  last
           Business  Day of the  calendar  month  at the  end of  such  Interest
           Period; and

                 (iii) no Interest  Period shall extend  beyond the  Termination
           Date.

           "Invested   Assets"  means  cash,   cash   equivalents,   short  term
     investments,  investments  held for sale and any  other  assets  which  are
     treated as investments under SAP.

           "IRS"  means  the  Internal  Revenue  Service,  and any  Governmental
     Authority succeeding to any of its principal functions under the Code.

           "Joint  Venture"  means a  single-purpose  corporation,  partnership,
     joint  venture  or other  similar  legal  arrangement  (whether  created by
     contract or  conducted  through a separate  legal  entity) now or hereafter
     formed by the Company or any of its  Subsidiaries  with  another  Person in
     order to conduct a common venture or enterprise with such Person.

           "Lending Office" means, as to any Bank, the office or offices of such
     Bank  specified as its "Lending  Office" or  "Domestic  Lending  Office" or
     "Eurodollar  Lending Office", as the case may be, on Schedule 15.2, or such
     other  office or  offices  as such Bank may from  time to time  notify  the
     Company and the Agent.

           "Lien" means any security interest,  mortgage, deed of trust, pledge,
     hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
     (statutory  or other)  or  preferential  arrangement  of any kind or nature
     whatsoever in respect of any property  (including those created by, arising
     under  or  evidenced  by any  conditional  sale or  other  title  retention
     agreement,  the interest of a lessor under a capital  lease,  any financing
     lease  having  substantially  the  same  economic  effect  as  any  of  the
     foregoing, or the filing of any financing statement naming the owner of the
     asset to which such lien  relates as debtor,  under the Uniform  Commercial
     Code or any  comparable  law)  and any  contingent  or other  agreement  to
     provide any of the  foregoing,  but not  including the interest of a lessor
     under an operating lease.

           "Loan" means an  extension  of credit by a Bank to the Company  under
     Article II, and may be a Base Rate Loan, CD Rate Loan or an Eurodollar Rate
     Loan (each,  a "Type" of Loan) and includes any Facility A Loan or Facility
     B Loan.

           "Loan  Documents"  means  this  Agreement,  any  Notes  and all other
     documents delivered to either Agent or any Bank in connection herewith.

           "Majority  Banks"  means  at any time  Banks  then  holding  at least
     66-2/3% of the then aggregate  unpaid principal amount of the Loans, or, if
     no such principal  amount is then  outstanding,  Banks then having at least
     66-2/3% of the Facility A Commitments.

           "Margin  Stock"  means  "margin  stock"  as such term is  defined  in
     Regulation G, T, U or X of the FRB.

           "Material  Adverse Effect" means (a) a material adverse change in, or
     a material  adverse  effect upon,  the  operations,  business,  properties,
     condition  (financial  or  otherwise)  or prospects of the  Guarantor,  the
     Company  or the  Company  and its  Subsidiaries  taken  as a  whole  or the
     Guarantor and its Subsidiaries taken as a whole; (b) a material  impairment
     of the ability of the Company or the  Guarantor  to perform  under any Loan
     Document and to avoid any Event of Default,  Guarantor  Event of Default or
     Company  Event of  Default;  or (c) an adverse  effect  upon the  legality,
     validity,  binding  effect or  enforceability  against  the  Company or the
     Guarantor of any Loan Document.

           "Maximum  Facility B Commitments"  means  $100,000,000 as such amount
     may be reduced pursuant to Section 2.7 and Section 2.9 hereof.

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

           "Moody's  Rating"  shall  mean at any  time the  Insurance  Financial
     Strength Ratings of the Guarantor  assigned by Moody's  Investors  Service,
     Inc.

           "Multiemployer  Plan"  means a  "Multi  employer  plan",  within  the
     meaning of Section  4001(a)(3) of ERISA,  to which the Company or any ERISA
     Affiliate  makes,  is making,  or is  obligated to make  contributions  or,
     during the preceding three calendar  years,  has made, or been obligated to
     make, contributions.

          "NAIC" means the National  Association of Insurance  Commissioners  or
     any successor thereto.

           "NAIC  Ratings"  shall  mean  the  quality  ratings  assigned  by the
     Securities Valuation Office of the NAIC to investments of the Guarantor and
     the  Primary  Insurance  Subsidiaries.  References  in  this  Agreement  to
     particular NAIC ratings are references to such ratings as currently defined
     and  classified  by  the  Securities   Valuation  Office  of  the  National
     Association of Insurance Commissioners and if such rating system is changed
     then each reference to a particular rating

<PAGE>


     in this  Agreement  shall be deemed to be a reference  to the rating  under
     such  changed  rating  system which most  closely  approximates  the credit
     quality of the particular rating as currently  defined.  The Guarantor will
     use its best  efforts  to at all  times  have not less than 90% of its bond
     portfolio and that of the Primary  Insurance  Subsidiaries  covered by NAIC
     Ratings. If for any reason beyond the control of the Guarantor NAIC Ratings
     are unavailable for such percentage of the bond portfolios of the Guarantor
     and the  Primary  Insurance  Subsidiaries  or the  NAIC  rating  system  is
     discontinued  then in that  event  the  Guarantor  and the  Banks  agree to
     negotiate  in good  faith  for an  amendment  to this  Agreement  replacing
     Sections 8.2 and 8.3 hereof with new covenants measuring the credit quality
     of  the  bond  portfolio  of  the  Guarantor  and  the  Primary   Insurance
     Subsidiaries and which are not materially more liberal nor restrictive than
     Sections 8.2 and 8.3 hereof as  presently in effect,  but in the event that
     the  Guarantor  and the  Majority  Banks  are  unable  to  agree to such an
     amendment within 60 days of the date the NAIC rating system is discontinued
     or the  Guarantor is unable to comply with the  preceding  sentence then in
     that event this  Agreement  may, at the option of the Majority Banks or the
     Guarantor,  terminate  whereupon the  Commitments  shall  terminate and all
     outstanding  Loans,  together with interest thereon and any amounts due the
     Banks under this Agreement,  including  under Section 3.4 hereof,  shall be
     repaid.

           "Net Cash  Proceeds"  means with  respect to the sale,  transfer,  or
     other  disposition  by  the  Guarantor  or  any  Subsidiary  of  any  asset
     (including  any  stock of any  Subsidiary),  the  aggregate  cash  proceeds
     (including cash proceeds  received by way of deferred  payment of principal
     pursuant to a note,  installment  receivable or otherwise,  but only as and
     when received) received by the Guarantor or any Subsidiary pursuant to such
     sale,  transfer or other disposition,  net of (i) the direct costs relating
     to such sale, transfer or other disposition (including, without limitation,
     sales commissions and legal,  accounting and investment banking fees), (ii)
     taxes paid or payable as a result  thereof  (after  taking into account any
     available  tax credits or  deductions  and any tax  sharing  arrangements),
     (iii) amounts  required to be applied to the repayment of any  Indebtedness
     secured  by a Lien on the asset  subject to such  sale,  transfer  or other
     disposition  (other than the Loans) and (iv) any reserve for  adjustment in
     respect of the sale price of such asset  (until such amount is available to
     the Guarantor or the applicable Subsidiary).

           "Net  Invested  Assets"  shall mean the  Guarantor's  and the Primary
     Insurance  Subsidiaries'  portfolios of stocks, bonds, mortgage loans, real
     estate,  policy loans and other assets  classified as invested assets under
     SAP less Separate Account assets.

           "Non-Performing  Real Estate" shall mean the book value of the sum of
     (i)  real  estate  acquired  by the  Guarantor  and the  Primary  Insurance
     Subsidiaries in satisfaction of indebtedness,  whether by foreclosure, deed
     in lieu of  foreclosure  or otherwise,  which during the period of 180 days
     prior to the date of determination had a net operating income (gross income
     less  taxes,  maintenance  and  other  operating  expenses  and  also  less
     principal  and interest on  indebtedness  not owing to the Guarantor or the
     applicable  Primary  Insurance  Subsidiary)  of less than 6% of book value,
     (ii) mortgage  loans the terms of which have been  modified  because of the
     borrower's inability to comply with the terms as originally agreed or which
     are in the process of  foreclosure  and under which the amount  received by
     the Guarantor or the applicable Primary Insurance Subsidiary  (exclusive of
     amounts  received for taxes or insurance or in payment of expenses)  during
     the 90 days  preceding the date of  determination  is an amount which on an
     annual  basis  would  return to the  Guarantor  or the  applicable  Primary
     Insurance Subsidiary less than 6% of the book value of the mortgage loan in
     question  and (iii)  mortgage  loans on which any payment of  principal  or
     interest is more than 90 days past due.

           "Note" means a promissory  note executed by the Company in favor of a
     Bank pursuant to subsection 2.2(b), in substantially the form of Exhibit F.

          "Notice  of  Borrowing"  means a notice in  substantially  the form of
     Exhibit A.

          "Notice of  Conversion/Continuation"  means a notice in  substantially
     the form of Exhibit B.

          "Notice of Facility A Conversion"  means a notice in  substantially in
     the form of Exhibit G.

          "Notice of Facility B Conversion"  means a notice in  substantially in
     the form of Exhibit H.

           "Obligations" means all advances,  debts,  liabilities,  obligations,
     covenants and duties  arising under any Loan Document  owing by the Company
     or the Guarantor to any Bank, any Agent, or any other  Indemnified  Person,
     whether  direct or  indirect  (including  those  acquired  by  assignment),
     absolute or  contingent,  due or to become due,  now  existing or hereafter
     arising.

           "Organization Documents" means, for any corporation,  the certificate
     or articles of incorporation,  the bylaws, any certificate of determination
     or  instrument  relating to the rights of  preferred  shareholders  of such
     corporation,   any  shareholder   rights  agreement,   and  all  applicable
     resolutions  of the board of directors (or any  committee  thereof) of such
     corporation.
           "Participant" has the meaning specified in subsection 15.8(d).

           "PBGC"  means  the  Pension  Benefit  Guaranty  Corporation,  or  any
     Governmental  Authority  succeeding to any of its principal functions under
     ERISA.

           "PCC" means Pasadena Capital Corporation.

           "PCC  Acquisition"  means the acquisition by the Company of the stock
     of PCC pursuant to the PCC Acquisition Agreement.

          "PCC Acquisition  Agreement" means the Agreement and Plan of Merger by
    and among the  Company,  Phoenix  Apollo  Corp.  and PCC dated as of June 9,
     1997.

           "Pension  Plan" means a pension  plan (as defined in Section  3(2) of
     ERISA) subject to Title IV of ERISA which the Company sponsors,  maintains,
     or to which it makes, is making, or is obligated to make contributions,  or
     in the case of a multiple employer plan (as described in Section 4064(a) of
     ERISA) has made contributions at any time during the immediately  preceding
     five (5) plan years.

           "Permitted Liens" has the meaning specified in Section 7.1.

           "Person"  means an  individual,  partnership,  corporation,  business
     trust,  joint  stock  company,  trust,  unincorporated  association,  joint
     venture or Governmental Authority.

           "Plan" means an employee  benefit plan (as defined in Section 3(3) of
     ERISA)  which the  Company  sponsors or  maintains  or to which the Company
     makes, is making,  or is obligated to make  contributions  and includes any
     Pension Plan.

           "Primary   Insurance   Subsidiaries"   shall   mean   those   Primary
     Subsidiaries principally engaged in the business of insurance.

           "Primary  Subsidiaries"  shall mean Phoenix  American Life  Insurance
     Co., the Company,  and any other  Subsidiary of the Guarantor  which at the
     time of determination has capital or a net worth in excess of $25,000,000.

           "Pro Rata Share" means,  as to any Bank at any time,  the  percentage
     equivalent (expressed as a decimal,  rounded to the ninth decimal place) at
     such time of such  Bank's  Facility A  Commitment  divided by the  combined
     Facility A Commitments of all Banks.

           "Rating" means the Moody's  Rating or the S&P Rating.  All references
     in this  Agreement  to  particular  Moody's  Ratings  and S&P  Ratings  are
     references to such ratings as currently  defined by Moody's and S&P, and in
     the event  either of such  corporations  changes  its rating  system,  each
     reference  to a  particular  rating  set forth in this  Agreement  shall be
     deemed to be a reference  to the rating under such  changed  rating  system
     which,  in the  reasonable  judgment  of the  Administrative  Agent,  after
     consultation  with the rating service involved,  most closely  approximates
     the level of claims paying ability associated with the particular rating as
     currently  defined.   Whenever  a  determination  of  compliance  with  any
     provision of this  Agreement or any interest rate or fee is dependent  upon
     the  availability of both a Moody's Rating and an S&P Rating and one or the
     other  (but not both) of such  rating  services  ceases to rate the  claims
     paying ability of the Guarantor,  compliance with the applicable provisions
     of this  Agreement and  determinations  of interest rates and fees shall be
     made on the  basis of the  rating  which is  available.  If for any  reason
     neither a Moody's  Rating nor an S&P Rating is available  for the Guarantor
     then in that event compliance with the provisions of this Agreement where a
     determination  of such a rating is  necessary,  determinations  of interest
     rates and fees shall be made by the Majority Banks, after consultation with
     the Guarantor,  based on the Majority  Banks' good faith  estimates of what
     such ratings would have been had they been available,  the determination of
     the Majority Banks in such regards to be final and conclusive provided that
     they have been made in good faith.

           "Reportable  Event"  means,  any of the  events  set forth in Section
     4043(b) of ERISA or the regulations  thereunder,  other than any such event
     for which the 30-day  notice  requirement  under  ERISA has been  waived in
     regulations issued by the PBGC.

           "Requirement of Law" means,  as to any Person,  any law (statutory or
     common), treaty, rule or regulation or determination of an arbitrator or of
     a Governmental  Authority,  in each case  applicable to or binding upon the
     Person or any of its property or to which the Person or any of its property
     is subject.

           "Responsible  Officer" means,  with respect to any Person,  the chief
     executive  officer,  or the president of such Person,  or any other officer
     having  substantially  the same  authority  and  responsibility;  or,  with
     respect to compliance with financial covenants, the chief financial officer
     or the treasurer of such Person, or any other officer having  substantially
     the same authority and responsibility.

           "Risk Based Capital  Ratio" shall mean, as of any time the same is to
     be  determined,  the ratio of  adjusted  capital  of the  Guarantor  to the
     Company Action Level of the Guarantor. Adjusted capital, for the purpose of
     this  definition,  shall  be  computed  in the  manner  from  time  to time
     prescribed  by the  Insurance  Department of the State of New York as total
     adjusted  capital for inclusion in the Annual Statement of the Guarantor to
     such department (currently appearing on page 23 of such annual statement in
     column 1, line 27 and  currently  consisting  of capital and  surplus,  the
     asset  valuation  reserve  of the  Guarantor  and  50%  of the  Guarantor's
     dividend liability).

           "S&P" means Standard & Poor's Ratings Group.

           "S&P Rating" shall mean at any time the Insurer Claims Paying Ability
     Rating of the Guarantor  assigned by Standard & Poor's Ratings Services,  a
     Division of the McGraw Hill Companies, Inc.

           "SAP" means, as to the Guarantor, the statutory accounting principles
     prescribed  or  permitted  by the  Department,  or in the  event  that  the
     Department  fails  to  prescribe  or  address  such  practices,   the  NAIC
     guidelines.

           "SAP  Capital"  means   unrestricted   surplus  accounts  plus  asset
     valuation  reserve plus surplus notes,  all  calculated in accordance  with
     SAP.

           "SEC"  means  the   Securities  and  Exchange   Commission,   or  any
     Governmental Authority succeeding to any of its principal functions.

           "Seneca" means GMG/Seneca Capital Management, LLC.

           "Seneca  Acquisition"  means the  acquisition  by the  Company of the
     majority  of  the  equity  interests  of  Seneca  pursuant  to  the  Seneca
     Acquisition Agreement.

           "Seneca  Acquisition  Agreement" means the Purchase  Agreement by and
     among the Company and certain  other Persons dated as of June 18, 1997 with
     respect to Seneca.

           "Senior Debt" means Indebtedness less Subordinated Debt.

           "Senior Debt to EBITDA  Ratio" means the ratio for the Company,  on a
     consolidated  basis in  accordance  with GAAP,  as at the end of any fiscal
     quarter of Senior Debt as of such  quarter end to EBITDA as of such quarter
     end for the four fiscal quarters then ending.

           "Separate  Accounts" shall mean accounts  maintained by the Guarantor
     and the Primary Insurance  Subsidiaries  pursuant to the New York Insurance
     Law of a character  such that the assets  allocated  thereto are to provide
     for annuities or life  insurance  benefits  under  specific  annuity and/or
     insurance  contracts and are not chargeable  with other  liabilities of the
     Guarantor or the Primary Insurance Subsidiaries.

          "Shareholders'   Equity"  means  shareholders'  equity  determined  in
     accordance with GAAP.

           "Subordinated   Debt"   means   Indebtedness   subordinated   to  the
     Obligations in form and substance satisfactory to the Majority Banks.

           "Subsidiary"  of  a  Person  means  any   corporation,   association,
     partnership,  joint venture or other business entity of which more than 50%
     of the voting stock or other equity interests (in the case of Persons other
     than  corporations),  is owned or controlled  directly or indirectly by the
     Person,  or one or more of the Subsidiaries of the Person, or a combination
     thereof.  Unless the context otherwise clearly requires,  references herein
     to a "Subsidiary" refer to a Subsidiary of the Guarantor.

           "Surety  Instruments"  means all letters of credit (including standby
     and commercial),  banker's  acceptances,  bank guaranties,  shipside bonds,
     surety bonds and similar instruments.

           "Surplus Notes" means surplus notes issued in accordance with Section
     1307 of the New York  Insurance  Law and which are payable only out of free
     and divisible surplus with the prior approval of the Department.

           "Swap Contract" means any agreement  (including any master  agreement
     and any  agreement,  whether  or not in  writing,  relating  to any  single
     transaction) that is an interest rate swap agreement,  basis swap,  forward
     rate agreement,  commodity swap,  commodity option,  equity or equity index
     swap or option, bond option, interest rate option, forward foreign exchange
     agreement,  rate cap, collar or floor  agreement,  currency swap agreement,
     cross-currency rate swap agreement, swaption, currency option or any other,
     similar  agreement   (including  any  option  to  enter  into  any  of  the
     foregoing).

           "Termination Date" means the earlier to occur of:

                 (a)   August 14, 2002; and

                 (b) the date on which the  Commitments  terminate in accordance
           with the provisions of this Agreement.

           "Total Debt to Capital  Ratio" means the ratio for the Company,  on a
     consolidated  basis in accordance with GAAP, of its Indebtedness to the sum
     of its Indebtedness plus its Shareholders'  Equity.  For the purpose of the
     calculations of Indebtedness for this ratio,  Indebtedness shall be reduced
     by an amount equal to the lesser of (i) 50% of any outstanding Subordinated
     Debt which has been exchanged for  Subordinated  Debt from preferred  stock
     outstanding on the Closing Date and (ii) $40,000,000.

           "Total SAP  Adjusted  Capital"  means SAP Capital  plus  reserves for
     losses on real estate.

           "12b-1 Asset" means, with respect to any Person,  such Person's right
     to  receive  payments  arising in  connection  with the sale of shares in a
     registered open-end management  investment company,  which payment shall be
     permitted pursuant to Rule 12b-1(b) (such payment, a so-called "12b-1 fee")
     or Rule 6c-10 (such payment, a so-called  "contingent deferred sales load")
     of the Investment Company Act of 1940.

           "Type" has the meaning specified in the definition of "Loan."

           "Unfunded  Pension  Liability"  means the excess of a Plan's  benefit
     liabilities  under Section  4001(a)(16) of ERISA, over the current value of
     that Plan's assets,  determined in accordance with the assumptions used for
     funding  the  Pension  Plan  pursuant  to  Section  412 of the Code for the
     applicable plan year.

           "United States" and "U.S." each means the United States of America.

           "Wholly-Owned  Subsidiary" means any corporation in which (other than
     directors'  qualifying shares required by law) 100% of the capital stock of
     each class having ordinary  voting power,  and 100% of the capital stock of
     every other class, in each case, at the time as of which any  determination
     is being made, is owned, beneficially and of record, by the Guarantor or by
     one or more of the other Wholly-Owned Subsidiaries, or both.

     1.2 Other  Interpretive  Provisions  (a) The meanings of defined  terms are
equally applicable to the singular and plural forms of the defined terms.

           (b) The words "hereof", "herein", "hereunder" and similar words refer
to  this  Agreement  as a  whole  and not to any  particular  provision  of this
Agreement; and subsection,  Section, Schedule and Exhibit references are to this
Agreement unless otherwise specified.

                  (c) (i) The term "documents" includes any and all instruments,
     documents,   agreements,   certificates,   indentures,  notices  and  other
     writings, however evidenced.

                (ii) The term  "including" is not limiting and means  "including
     without limitation."

                 (iii) In the  computation  of periods of time from a  specified
date to a later specified date, the word "from" means "from and including";  the
words "to" and  "until"  each mean "to but  excluding",  and the word  "through"
means "to and including."

<PAGE>


           (d)  Except  as   otherwise   stated,   the  terms   "determine"   or
"determination"  mean  to  reasonably  determine  or  reasonable  determination,
respectively.

                  (e) Unless otherwise expressly provided herein, (i) references
to agreements (including this Agreement) and other contractual instruments shall
be deemed to include all subsequent amendments and other modifications  thereto,
but  only  to the  extent  such  amendments  and  other  modifications  are  not
prohibited by the terms of any Loan Document, and (ii) references to any statute
or regulation  are to be construed as including  all  statutory  and  regulatory
provisions consolidating, amending, replacing, supplementing or interpreting the
statute or regulation.

           (f) The captions and headings of this  Agreement are for  convenience
of reference only and shall not affect the interpretation of this Agreement.

           (g) This Agreement and other Loan Documents may use several different
limitations,  tests or measurements to regulate the same or similar matters. All
such  limitations,  tests and  measurements  are  cumulative  and shall  each be
performed in accordance with their terms.

           (h) This  Agreement  and the other Loan  Documents  are the result of
negotiations  among and have been reviewed by counsel to the Agents, the Company
and the other parties,  and are the products of all parties.  Accordingly,  they
shall not be  construed  against the Banks or the Agents  merely  because of the
Agents' or Banks' involvement in their preparation.

     1.3  Accounting  Principles.  (a)  Unless  the  context  otherwise  clearly
requires,  all accounting terms not expressly defined herein shall be construed,
and all financial  computations  required under this Agreement shall be made, in
accordance with GAAP, consistently applied.

           (b)References  herein to "fiscal year" and "fiscal  quarter" refer to
              such fiscal periods of the Company.

                                         ARTICLE II

                                        THE CREDITS

     2.1 Amounts and Terms of Commitments.  (a) The Facility A Credit. Each Bank
severally agrees, on the terms and conditions set forth herein, to make loans to
the  Company  (each such loan,  a  "Facility  A Loan")  from time to time on any
Business Day during the period from the Closing Date to the Termination Date, in
an aggregate  amount not to exceed at any time  outstanding,  together  with the
principal  amount of Loans  outstanding  (including  both  Facility  A Loans and
Facility B Loans) in favor of such Bank at such time,  the amount set forth next
to such  Bank's  name on  Schedule  2.1 (such  amount as the same may be reduced
under Section 2.7 or 2.9 or as a result of one or more assignments under Section
15.8, the Bank's "Facility A Commitment"); provided, however, that, after giving
effect to any Borrowing, the aggregate principal amount of all outstanding Loans
(including  both  Facility A Loans and  Facility B Loans)  shall not at any time
exceed the  combined  Facility A  Commitments.  Within the limits of each Bank's
Commitment,  and subject to the other terms and conditions  hereof,  the Company
may borrow under this  Section  2.1(a),  prepay  under  Section 2.8 and reborrow
under this Section 2.1(a).

           (b) The Facility B Credit.  Each Bank severally  agrees, on the terms
and conditions set forth herein,  to convert  Facility A Loans into loans to the
Company  (each such loan, a "Facility B Loan") from time to time on any Business
Day during the period  from the  Closing  Date to the  Termination  Date,  in an
aggregate amount not to exceed at any time outstanding,  the amount set forth in
Schedule 2.1 (such  amount,  as the same may be reduced under Section 2.7 or 2.9
or as a the result of one or more  assignments  under Section  15.8,  the Bank's
"Facility B Commitment");  provided,  however,  that, after giving effect to any
Facility  B  Conversion,  the  aggregate  principal  amount  of all  outstanding
Facility B Loans shall not at any time exceed the  combined  Maximum  Facility B
Commitments. Within the limits of each Bank's Facility B Commitment, and subject
to the other terms and  conditions  hereof,  the Company may convert  under this
Section  2.1(b),  prepay under  Section 2.8 and convert again under this Section
2.1(b).  At no time shall any Bank's  Facility B Commitment  exceed its Pro Rata
Share of the Maximum  Facility B  Commitments.  Each Facility B Loan shall be of
the same Type,  be in the same amount and have an Interest  Period  equal to the
remainder of the same  Interest  Period of the Facility A Loans being  converted
(with its interest rate  calculated  for the  remainder of the Interest  Period,
based on the same  Eurodollar  Rate,  if a Eurodollar  Rate Loan and the same CD
Rate, if a CD Rate Loan).

     2.2 Loan  Accounts.  (a) The Loans made by each Bank shall be  evidenced by
one or more loan  accounts or records  maintained  by such Bank in the  ordinary
course  of  business.   The  loan   accounts  or  records   maintained   by  the
Administrative  Agent shall be conclusive absent manifest error of the amount of
the  Loans  made by the  Banks to the  Company  and the  interest  and  payments
thereon.  Any failure so to record or any error in doing so shall not,  however,
limit or otherwise  affect the  obligation  of the Company  hereunder to pay any
amount owing with respect to the Loans.

           (b) Upon the  request  of any Bank made  through  the  Administrative
Agent,  the  Loans  made by such  Bank may be  evidenced  by one or more  Notes,
instead of loan accounts.  Each such Bank shall endorse on the schedules annexed
to its  Note(s)  the date,  amount and  maturity of each Loan made by it and the
amount of each  payment of principal  made by the Company with respect  thereto.
Each such Bank is irrevocably  authorized by the Company to endorse its Note(s);
provided,  however, that the failure of a Bank to make, or an error in making, a
notation  thereon with  respect to any Loan shall not limit or otherwise  affect
the obligations of the Company hereunder or under any such Note to such Bank.

            2.3 Procedure for Borrowing.  (a) Each Facility A Borrowing shall be
made  upon  the  Company's   irrevocable   written   notice   delivered  to  the
Administrative  Agent in the form of a Notice of Borrowing (which notice must be
received by the  Administrative  Agent prior to 11:00 a.m.  (New York City time)
(i) three  Business Days prior to the requested  Borrowing  Date, in the case of
Eurodollar Rate Loans;  (ii) two Business Days prior to the requested  Borrowing
Date,  in the case of CD Rate  Loans,  and (iii) one  Business  Day prior to the
requested Borrowing Date, in the case of Base Rate Loans, specifying:

               (A) the amount of the  Borrowing,  which shall be in an aggregate
       minimum  amount of  $5,000,000  or any multiple of  $1,000,000  in excess
       thereof;

              (B)     the requested  Borrowing  Date,  which shall be a Business
       Day;

               (C)     the Type of Loans comprising the Borrowing; and

               (D) the duration of the Interest Period  applicable to such Loans
       included in such notice.  If the Notice of Borrowing fails to specify the
       duration of the Interest  Period for any  Borrowing  comprised of CD Rate
       Loans or Eurodollar Rate Loans,  such Interest Period shall be 90 days or
       three months, respectively.

           (b) after giving effect to any  Borrowing,  there may be no more than
       10 different Interest Periods in effect.

     2.4 Facility B  Conversion.  (a) Each  Facility B Conversion  shall be made
     upon  the   Company's   irrevocable   written   notice   delivered  to  the
     Administrative  Agent in the  form of a Notice  of  Facility  B  Conversion
     (which notice must be received by the  Administrative  Agent prior to 11:00
     a.m. (New York City time) one Business Day prior to the requested  Facility
     Conversion Date, specifying:

           (i) the amount of the  Facility  B  Conversion  which  shall be in an
     aggregate  minimum  amount of  $5,000,000  or any multiple of $1,000,000 in
     excess thereof;

          (ii)  the  requested  Facility  Conversion  Date,  which  shall  be  a
     Business Day; and

           (iii) the  particular  Loans to be converted  (identified  by Type of
     Loan  and  Interest  Period,  if  applicable)  comprising  the  Facility  B
     Conversion.

           (b) The  Administrative  Agent will promptly  notify each Bank of its
     receipt of any Notice of  Facility B  Conversion  and of the amount of such
     Bank's Pro Rata Share of that Facility B Conversion.

           (c) After giving effect to any Facility B  Conversion,  there may not
     be more than 10 different Interest Periods in effect.

           It is understood and agreed that, subject to the terms and conditions
     set forth herein,  the Company may  concurrently  request a Facility A Loan
     and a Facility B Conversion,  in which case the  applicable  Borrowing Date
     shall also be the applicable Facility Conversion Date.

           2.5 Facility A Conversion.  The Company may, upon irrevocable written
     notice to the Agent in accordance with subsection 2.5(b),  elect, as of any
     Business Day, to convert any Facility B Loans into Facility A Loans.

           (b) The  Company  shall  deliver a Notice of  Facility  A  Conversion
     co-signed by the Guarantor to be received by the  Administrative  Agent not
     later  than 11:00 a.m.  (New York City time) at least one  Business  Day in
     advance of the Facility Conversion Date specifying:

           (i) the  aggregate  amount of Facility B Loans to be converted  which
     shall be in a minimum amount of $5,000,000 or any multiple of $1,000,000 in
     excess thereof;

          (ii)  the  requested  Facility  Conversion  Date,  which  shall  be  a
     Business Day; and

           (iii) the  particular  Loans to be converted  (identified  by Type of
     Loan and  Interest  Period,  if  applicable)  resulting  from the  proposed
     conversion or continuation.

                 (c) The Administrative  Agent will promptly notify each Bank of
     its  receipt of any Notice of  Facility A  Conversion  and of the amount of
     such Bank's Pro Rata Share of that Facility A Conversion.

           (d) After giving effect to any Facility A  Conversion,  there may not
     be more than 10 different Interest Periods in effect.

           (e) Upon (i) the  occurrence  of an Event of Default  with respect to
     the  Company  described  in  Section  11.1(f)  or  11.1(g) or (ii) upon the
     acceleration  of any  Subordinated  Debt issued in exchange  for  preferred
     stock  outstanding  on the  Closing  Date,  all  Facility B Loans  shall be
     automatically  converted into Facility A Loans,  without any further action
     by any Person, including the Company and the Guarantor, and notwithstanding
     any failure to meet any conditions set forth in Article IV hereof.


           (f) Each  Facility A Loan arising from a Facility A Conversion  shall
     be of the same  Type,  be in the same  amount and have an  Interest  Period
     equal to the remainder of the same Interest  Period of the Facility B Loans
     being converted (with the interest rate calculated for the remainder of the
     Interest  Period,  based on the same Eurodollar  Rate, if a Eurodollar Rate
     Loan and the same CD Rate, if a CD Rate Loan.)

    2.6   Conversion and Continuation Elections.        (a)  The  Company   may,
     upon irrevocable  written notice to the Agent in accordance with subsection
     2.6(b):

                 (i) elect,  as of any  Business  Day,  in the case of Base Rate
     Loans, or as of the last day of the applicable Interest Period, in the case
     of any other Type of Loans,  to convert any such Loans (or any part thereof
     in an amount not less than $5,000,000,  or that is in an integral  multiple
     of $1,000,000 in excess thereof) into Loans of any other Type; or

                 (ii)  elect,  as of the  last  day of the  applicable  Interest
     Period,  to continue any Loans having Interest Periods expiring on such day
     (or any part thereof in an amount not less than  $5,000,000,  or that is in
     an integral multiple of $1,000,000 in excess thereof);

     provided,  that if at any time the  aggregate  amount  of CD Rate  Loans or
     Eurodollar  Rate Loans in respect of any Borrowing is reduced,  by payment,
     prepayment, or conversion of part thereof to be less than $5,000,000,  such
     CD Rate Loans or  Eurodollar  Rate Loans shall  automatically  convert into
     Base Rate Loans.

                 (b)  The  Company  shall   deliver  a  Notice  of   Conversion/
     Continuation  to be  received  by the  Administrative  Agent not later than
     11:00 a.m. (New York City time) at least (i) three Business Days in advance
     of the Conversion/Continuation  Date, if the Loans are to be converted into
     or continued as Eurodollar Rate Loans; (ii) two Business Days in advance of
     the Conversion/Continuation  Date, if the Loans are to be converted into or
     continued  as CD Rate Loans;  and (iii) one  Business Day in advance of the
     Conversion/  Continuation  Date, if the Loans are to be converted into Base
     Rate Loans, specifying:

                 (A)  the proposed Conversion/Continuation Date;

                (B)  the aggregate amount of Loans to be converted or continued;

                 (C) the Type of Loans  result from the proposed  conversion  or
     continuation; and

                 (D) other than in the case of conversions into Base Rate Loans,
     the duration of the requested Interest Period.

           (c) If upon the  expiration of any Interest  Period  applicable to CD
Rate Loans or Eurodollar  Rate Loans,  the Company has failed to select timely a
new Interest  Period to be applicable  to such CD Rate Loans or Eurodollar  Rate
Loans,  as the case may be,  or if any  Default,  Event  of  Default,  Guarantor
Default or  Guarantor  Event of Default  then  exists,  or, with  respect to the
Facility B Loans,  any Company  Default or Company Event of Default then exists,
the  Company  shall be deemed to have  elected to convert  such CD Rate Loans or
Eurodollar  Rate Loans into Base Rate Loans  effective as of the expiration date
of such Interest Period.

           (d) The  Administrative  Agent will promptly  notify each Bank of its
receipt  of a Notice of  Conversion/Continuation,  or,  if no  timely  notice is
provided by the Company, the Administrative Agent will promptly notify each Bank
of the details of any automatic  conversion.  All conversions and  continuations
shall be made ratably according to the respective  outstanding principal amounts
of the Loans with respect to which the notice was given held by each Bank.

           (e) Unless the Majority Banks  otherwise  agree,  with respect to all
Loans during the existence of a Default, Event of Default,  Guarantor Default or
Guarantor  Event of Default  or, with  respect to  Facility B Loans,  during the
existence of a Company Default or Company Event of Default,  the Company may not
elect to have a Loan converted into or continued as an Eurodollar Rate Loan or a
CD Rate Loan.

           (f) After giving effect to any conversion or  continuation  of Loans,
there may not be more than 10 different Interest Periods in effect.

     2.7 Voluntary  Termination  or Reduction of  Commitments.  The Company may,
upon not less than  three  Business  Days'  prior  notice to the  Administrative
Agent, terminate the Facility A Commitments,  or permanently reduce the Facility
A Commitments  by an aggregate  minimum  amount of $5,000,000 or any multiple of
$1,000,000  in excess  thereof;  provided,  however,  that any  reduction of the
Facility A Commitment  shall be accompanied by a reduction of Maximum Facility B
Commitments  in  an  amount  equal  to  one-half  of  the  reduced   Facility  A
Commitments; and, provided, further, that after giving effect thereto and to any
prepayments  of Loans made on the effective date thereof,  the  then-outstanding
principal  amount of the Loans  (including  both Facility A Loans and Facility B
Loans) may not exceed the amount of the combined  Commitments then in effect and
the then-outstanding amount of the Facility B Loans may not exceed the amount of
the combined  Maximum  Facility B  Commitments  then in effect.  Once reduced in
accordance  with this  Section,  the  Facility  A  Commitments  and the  Maximum
Facility B  Commitments  may not be  increased.  Any reduction of the Facility A
Commitments and the Maximum Facility B Commitments shall be applied to each Bank
according  to its Pro Rata  Share.  All  accrued  commitment  fees  to,  but not
including the effective  date of any reduction or  termination  of  Commitments,
shall be paid on the effective date of such reduction or termination.

     2.8 Optional  Prepayments.  Subject to Section 3.4, the Company may, at any
time or from time to time,  upon not less than three Business Days'  irrevocable
notice  to the  Agent,  ratably  prepay  Loans in whole or in part,  in  minimum
amounts of $5,000,000 or any multiple of $1,000,000 in excess thereof; provided,
that all prepayments shall be applied to the Facility B Loans until the Facility
B Loans shall be repaid in full,  and then to the Facility A Loans.  Such notice
of  prepayment  shall  specify  the date and amount of such  prepayment  and the
Type(s) of Loans to be prepaid.  The Agent will promptly notify each Bank of its
receipt  of any  such  notice,  and of  such  Bank's  Pro  Rata  Share  of  such
prepayment.  If such notice is given by the Company, the Company shall make such
prepayment  and the payment  amount  specified  in such notice  shall be due and
payable on the date specified  therein,  together with accrued  interest to each
such date on the amount  prepaid  and any amounts  required  pursuant to Section
3.4.

     2.9 Mandatory Prepayments of Loans;  Mandatory Commitment  Reductions.  The
Company  shall make a prepayment  of the Loans  within 30 days after  receipt of
proceeds  from any sale,  transfer  or other  disposition  by the Company or any
Subsidiary  of the  Company  of any asset  outside  the  ordinary  course of its
business  (other than any sale of 12b-1 Assets pursuant to the Purchase and Sale
Agreement among Phoenix Equity Planning Corporation, the Company and FEP Capital
L.P.  dated as of June 1, 1997,  additional  sales of 12b-1  Assets for up to an
aggregate  amount of  $4,000,000  or any  capital  stock of Beutel  Goodman  and
Company  Ltd.,  so long as in either  case the  proceeds  of such sale  shall be
reinvested within 365 days in businesses or assets substantially  similar to the
business  or assets of the  Company  in an amount  equal to 100% of the Net Cash
Proceeds of such sale, to the extent the aggregate proceeds thereof shall exceed
$2,000,000 in any fiscal year. All prepayments of Loans pursuant to this Section
2.9 shall be applied  to the  Facility  B Loans  until the  Facility B Loans are
repaid in full, and then to the Facility A Loans.  On the date of any prepayment
pursuant to this Section 2.9, accrued interest on the amount of such prepayment,
together with any amounts owing under Section 3.4, shall be due and payable. The
Facility A Commitments  shall be reduced by the amount of such  prepayments  and
the  Maximum  Facility B  Commitments  shall be  reduced  by an amount  equal to
one-half of the amount of such prepayment.

     2.10  Repayment.  The Company  shall repay to the Banks on the  Termination
Date the aggregate principal amount of Loans outstanding on such date.

     2.11  Interest.  (a) Each  Loan  shall  bear  interest  on the  outstanding
principal amount thereof from the applicable  Borrowing Date at a rate per annum
equal to the CD Rate, the  Eurodollar  Rate or the Base Rate, as the case may be
(and  subject to the  Company's  right to convert to other  Types of Loans under
Section 2.6), plus the Applicable  Margin,  in the case of Eurodollar Rate Loans
and CD Rate Loans.

           (b)  Interest on each Loan shall be paid in arrears on each  Interest
Payment Date. Interest shall also be paid on the date of any prepayment of Loans
under  Section  2.8 or 2.9 for the  portion  of the  Loans so  prepaid  and upon
payment  (including  prepayment)  in full thereof and,  with respect to any Loan
during the existence of any Event of Default or Guarantor Event of Default,  or,
with  respect  to any  Facility  B Loan  during any  Company  Event of  Default,
interest shall be paid on demand of the  Administrative  Agent at the request or
with the consent of the Majority Banks.

           (c)  Notwithstanding  subsection  (a) of this Section with respect to
any Loan,  while any Event of Default or  Guarantor  Event of Default  exists or
after  acceleration,  or with respect to any Facility B Loan,  while any Company
Event of Default exists, the Company shall pay interest (after as well as before
entry of  judgment  thereon to the  extent  permitted  by law) on the  principal
amount of all  outstanding  Loans,  at a rate per annum which is  determined  by
adding 2% per annum to the Applicable  Margin then in effect for such Loans and,
in the case of Base Rate Loans,  at a rate per annum equal to the Base Rate plus
2%; provided,  however, that, on and after the expiration of any Interest Period
applicable to any Eurodollar  Rate Loan or CD Rate Loan  outstanding on the date
of occurrence of such Event of Default or acceleration,  the principal amount of
such Loan  shall,  during  the  continuation  of such  Event of Default or after
acceleration, bear interest at a rate per annum equal to the Base Rate plus 2%.

           (b) Highest  Lawful Rate.  At no time shall the interest rate payable
on the Loans of any Bank,  together with the fees and all other amounts  payable
under the Loan  Documents to such Bank,  to the extent the same are construed to
constitute interest,  exceed the Highest Lawful Rate applicable to such Bank. If
with respect to any Bank for any period during the term of this  Agreement,  any
amount paid to such Bank under the Loan Documents,  to the extent the same shall
(but for the  provisions of this Section)  constitute or be deemed to constitute
interest,  would exceed the maximum amount of interest  permitted by the Highest
Lawful  Rate  applicable  to such Bank during such  period  (such  amount  being
hereinafter referred to as an "Unqualified  Amount"),  then (i) such Unqualified
Amount  shall be applied or shall be deemed to have been applied as a prepayment
of the Loans of such Bank, and (ii) if in any subsequent  period during the term
of this Agreement,  all amounts payable under the Loan Documents to such Bank in
respect  of such  period  which  constitute  or shall be  deemed  to  constitute
interest  shall be less than the  maximum  amount of interest  permitted  by the
Highest  Lawful Rate  applicable  to such Lender  during such  period,  then the
Company  shall  pay to such Bank in  respect  of such  period an amount  (each a
"Compensatory  Interest  Payment") equal to the lesser of (x) a sum which,  when
added to all such amounts,  would equal the maximum amount of interest permitted
by the Highest Lawful Rate  applicable to such Bank during such period,  and (y)
an amount equal to the Unqualified Amount less all other  Compensatory  Interest
Payments made in respect thereof.

     2.12 Fees. (a) Arrangement, Agency Fees. The Company shall pay such fees to
the  Arrangers and the Agents for their own accounts as may be agreed to between
the Company and the applicable Arranger and Agent from time to time.

           (b)  Commitment  Fees.  The Company  shall pay to the  Administrative
Agent for the account of each Bank a commitment  fee on the average daily unused
portion of such Bank's Facility A Commitment  (which,  with respect to each Bank
on any day,  shall equal such Bank's  Facility A Commitment  less the sum of all
outstanding  Facility A Loans and Facility B Loans of such Bank),  computed on a
quarterly  basis in arrears on the last  Business Day of each  calendar  quarter
based  upon  the  daily  utilization  for  that  quarter  as  calculated  by the
Administrative  Agent,  equal  to  the  Applicable  Fee  Rate  per  annum.  Such
commitment  fee shall  accrue from the date hereof to the  Termination  Date and
shall be due and payable  quarterly in arrears on the last  Business Day of each
calendar quarter  commencing on September 30, 1997 through the Termination Date,
with the final payment to be made on the  Termination  Date;  provided  that, in
connection  with any reduction or  termination  of Facility A Commitments  under
Section 2.7 or Section 2.9, the accrued commitment fee calculated for the period
ending  on  such  date  shall  also be paid  on the  date of such  reduction  or
termination,  with the following quarterly payment being calculated on the basis
of the period from such reduction or termination date to such quarterly  payment
date. The commitment fees provided in this subsection  shall accrue at all times
after the above-mentioned  commencement date, including at any time during which
one or more conditions in Article IV are not met.

     2.13 Computation of Fees and Interest. (a) All computations of interest for
Base Rate Loans when the Base Rate is determined by BNY's  "reference  rate" and
all  computations of commitment fees shall be made on the basis of a year of 365
or 366 days, as the case may be, and actual days elapsed. All other computations
of interest shall be made on the basis of a 360-day year and actual days elapsed
(which  results in more  interest  being paid than if computed on the basis of a
365-day  year).  Interest and fees shall accrue during each  Interest  Period or
other period during which  interest or such fees are computed from the first day
thereof to but excluding  the last day thereof.  With regard to CD Rate Loans or
Eurodollar  Rate Loans,  which are converted from Facility A Loans to Facility B
Loans during an Interest  Period,  or vice versa,  interest  shall be calculated
based on the old Applicable Margin to but excluding the Facility Conversion Date
and on the new  Applicable  Margin from and  including  the Facility  Conversion
Date.

           (b) Each  determination  of an  interest  rate by the  Administrative
Agent  shall be  conclusive  and  binding  on the  Company  and the Banks in the
absence of manifest error.

     2.14  Payments by the  Company.  (a) All payments to be made by the Company
shall be made without set-off,  recoupment or counterclaim.  Except as otherwise
expressly  provided  herein,  all  payments by the Company  shall be made to the
Administrative Agent for the account of the Banks at the Administrative  Agent's
Payment Office, and shall be made in dollars and in immediately available funds,
no later than 12:00 p.m. (New York City time) on the date specified herein.  The
Administrative  Agent will  promptly  distribute to each Bank its Pro Rata Share
(or other applicable share as expressly provided herein) of such payment in like
funds as received.  Any payment received by the Administrative  Agent later than
12:00 p.m.  (New York City time)  shall be deemed to have been  received  on the
following  Business  Day and any  applicable  interest or fee shall  continue to
accrue.

           (c)  Subject  to  the  provisions  set  forth  in the  definition  of
"Interest  Period"  herein,  whenever  any  payment is due on a day other than a
Business Day, such payment shall be made on the following Business Day, and such
extension of time shall in such case be included in the  computation of interest
or fees, as the case may be.

           (d) Unless the Administrative  Agent receives notice from the Company
prior to the date on which any payment is due to the Banks that the Company will
not make such payment in full as and when required, the Administrative Agent may
assume  that the  Company  has made such  payment in full to the  Administrative
Agent on such date in immediately  available funds and the Administrative  Agent
may (but shall not be so required), in reliance upon such assumption, distribute
to each Bank on such due date an amount  equal to the amount then due such Bank.
If and to the  extent  the  Company  has not made  such  payment  in full to the
Administrative  Agent,  each Bank  shall  repay to the  Administrative  Agent on
demand such amount  distributed to such Bank,  together with interest thereon at
the Federal Funds Rate for each day from the date such amount is  distributed to
such Bank until the date repaid.

            2.15 Payments by the Banks to the  Administrative  Agent. (a) Unless
the Administrative  Agent receives notice from a Bank on or prior to the Closing
Date or, with  respect to any  Borrowing  after the Closing  Date,  at least one
Business Day prior to the date of such  Borrowing,  that such Bank will not make
available as and when  required  hereunder to the  Administrative  Agent for the
account  of the  Company  the  amount  of that  Bank's  Pro  Rata  Share  of the
Borrowing,  the  Administrative  Agent may  assume  that each Bank has made such
amount available to the Administrative  Agent in immediately  available funds on
the  Borrowing  Date  and the  Administrative  Agent  may (but  shall  not be so
required),  in reliance upon such  assumption,  make available to the Company on
such date a corresponding  amount.  If and to the extent any Bank shall not have
made  its full  amount  available  to the  Administrative  Agent in  immediately
available  funds and the  Administrative  Agent in such  circumstances  has made
available  to the  Company  such  amount,  that Bank shall on the  Business  Day
following such Borrowing Date make such amount  available to the  Administrative
Agent, together with interest at the Federal Funds Rate for each day during such
period. A notice of the Administrative  Agent submitted to any Bank with respect
to amounts owing under this subsection (a) shall be conclusive,  absent manifest
error. If such amount is so made available,  such payment to the  Administrative
Agent  shall  constitute  such  Bank's  Loan on the  date of  Borrowing  for all
purposes  of this  Agreement.  If  such  amount  is not  made  available  to the
Administrative  Agent on the Business Day  following  the  Borrowing  Date,  the
Administrative  Agent will notify the Company of such failure to fund and,  upon
demand by the  Administrative  Agent,  the Company  shall pay such amount to the
Administrative  Agent for the  Administrative  Agent's  account,  together  with
interest  thereon for each day elapsed  since the date of such  Borrowing,  at a
rate per annum equal to the interest  rate  applicable  at the time to the Loans
comprising such Borrowing.

           (b) The  failure of any Bank to make any Loan on any  Borrowing  Date
shall not relieve any other Bank of any  obligation  hereunder to make a Loan on
such Borrowing  Date,  but no Bank shall be  responsible  for the failure of any
other Bank to make the Loan to be made by such other Bank on any Borrowing Date.

     2.16  Sharing  of  Payments,  Etc.  If,  other than as  expressly  provided
elsewhere  herein,  any Bank shall obtain on account of the Loans made by it any
payment (whether  voluntary,  involuntary,  through the exercise of any right of
set-off,  or  otherwise)  in  excess  of its Pro Rata  Share,  such  Bank  shall
immediately (a) notify the  Administrative  Agent of such fact, and (b) purchase
from the other Banks such  participations  in the Loans made by them as shall be
necessary  to cause such  purchasing  Bank to share the excess  payment pro rata
with each of them; provided,  however, that if all or any portion of such excess
payment is thereafter recovered from the purchasing Bank, such purchase shall to
that extent be rescinded and each other Bank shall repay to the purchasing  Bank
the purchase price paid  therefor,  together with an amount equal to such paying
Bank's  ratable  share  (according  to the  proportion of (i) the amount of such
paying Bank's required  repayment to (ii) the total amount so recovered from the
purchasing  Bank)  of any  interest  or  other  amount  paid or  payable  by the
purchasing Bank in respect of the total amount so recovered.  The Company agrees
that any Bank so  purchasing  a  participation  from  another  Bank may,  to the
fullest extent permitted by law,  exercise all its rights of payment  (including
the right of  set-off,  but  subject  to  Section  15.10)  with  respect to such
participation  as fully as if such Bank were the direct  creditor of the Company
in the amount of such participation.  The Administrative Agent will keep records
(which  shall be  conclusive  and binding in the  absence of manifest  error) of
participations  purchased  under this  Section  and will in each case notify the
Banks following any such purchases or repayments.


                                   ARTICLE III

                     TAXES, YIELD PROTECTION AND ILLEGALITY

     3.1 Taxes.  (a) Payments to be Free and Clear.  All payments by the Company
or the  Guarantor  under  the  Loan  Documents  to or  for  the  account  of the
Administrative  Agent, or any Bank (each, an "Indemnified  Tax Person") shall be
made free and clear of, and  without  any  deduction  or  withholding  for or on
account of, any and all current or future taxes,  levies,  imposts,  deductions,
charges or  withholdings,  and all liabilities  with respect thereto  (including
interest,  additions to tax, and penalties thereon) imposed, levied,  collected,
withheld or assessed by the United States or any political subdivision or taxing
authority thereof (collectively,  "Taxes"),  excluding as to any Indemnified Tax
Person,  (i) a Tax on the Income imposed on such Indemnified Tax Person and (ii)
any interest, fees, additions to tax or penalties for late payment thereof (each
such  nonexcluded Tax, an "Indemnified  Tax"). For purposes hereof,  "Tax on the
Income"  shall  mean,  as to any Person,  a Tax imposed by one of the  following
jurisdictions or by any political  subdivision or taxing authority thereof:  (i)
the United  States,  (ii) the  jurisdiction  in which such Person is  organized,
(iii) the jurisdiction in which such Person's  principal  office is located,  or
(iv) in the case of each Bank, any jurisdiction in which such Bank's  applicable
Lending  Office is located;  which Tax is an income tax or franchise tax imposed
on all or part of the net  income  or net  profits  of such  Person or which Tax
represents  interest,  fees, or penalties for late payment of such an income tax
or franchise tax.

           (b) Grossing Up of Payments.  If the  Company,  the  Guarantor or any
other Person is required by law, rule, regulation,  order, directive,  treaty or
guideline to make any deduction or withholding  (which  deduction or withholding
would  constitute an Indemnified Tax) from any amount required to be paid by the
Company or the Guarantor to or on behalf of an Indemnified  Tax Person under any
Loan Document (i) the Company or the Guarantor  shall pay such  Indemnified  Tax
before the date on which penalties  attach thereto,  such payment to be made for
its own  account  (if the  liability  to pay is  imposed  on the  Company or the
Guarantor)  or on behalf of and in the name of such  Indemnified  Tax Person (if
the  liability  is imposed on such  Indemnified  Tax  Person),  and (ii) the sum
payable to such Indemnified Tax Person shall be increased as may be necessary so
that after making all required deductions and withholdings (including deductions
and withholdings  applicable to additional sums payable under this Section) such
Indemnified  Tax  Person  receives  an  amount  equal to the sum it  would  have
received had no such deductions or withholdings been made.

           (c) Other  Taxes.  The  Company  and the  Guarantor  agree to pay any
current or future  stamp or  documentary  taxes or any other  excise or property
taxes,  charges or similar  levies that rise from any payment made  hereunder or
from the execution, delivery or registration of, or any amendment, supplement or
modification  of, or any  waiver or  consent  under or in  respect  of, the Loan
Documents or otherwise  with respect to, the Loan Documents  (collectively,  the
"Other Taxes").


           (d) Evidence of Payment.  Within 30 days after the reasonable request
therefor by the Agent in  connection  with any payment of  Indemnified  Taxes or
Other Taxes,  the Company or the Guarantor,  as applicable,  will furnish to the
Administrative  Agent the  original or a certified  copy of an official  receipt
from the jurisdiction to which payment is made evidencing payment thereof or, if
unavailable,  a  certificate  from a  Responsible  Officer that states that such
payment has been made and that sets forth the date and amount of such payment.

           (e) U.S.  Tax  Certificates.  Each  Indemnified  Tax  Person  that is
organized under the laws of any jurisdiction other than the United States or any
political  subdivision  thereof  that  is  exempt  from  United  States  federal
withholding  tax,  or that is  subject  to such tax at a reduced  rate  under an
applicable  treaty,  with  respect to payments  under the Loan  Documents  shall
deliver to the Administrative Agent for transmission to the Company, on or prior
to the Closing Date (in the case of each  Indemnified  Tax Person  listed on the
signature  pages  hereof)  or on  the  effective  date  of  the  Assignment  and
Acceptance  Agreement  or  other  document  pursuant  to  which  it  becomes  an
Indemnified Tax Person (in the case of each other  Indemnified Tax Person),  and
at such other times as the Company or the  Administrative  Agent may  reasonably
request,  Internal  Revenue  Form  4224 or Form  1001 or  other  certificate  or
document  required  under  United  States law to establish  entitlement  to such
exemption  or reduced  rate.  Neither  the Company  nor the  Guarantor  shall be
required to pay any additional  amount to any such  Indemnified Tax Person under
subsection (b) above if such Indemnified Tax Person shall have failed to satisfy
the requirements of the immediately  preceding  sentence;  provided that if such
Indemnified  Tax Person shall have  satisfied such  requirements  on the Closing
Date (in the case of each  Indemnified  Tax Person listed on the signature pages
hereof) or on the effective date of the  Assignment and Acceptance  Agreement or
other  document  pursuant to which it became an  Indemnified  Tax Person (in the
case of each other  Indemnified Tax Person),  nothing in this  subsection  shall
relieve the Company or the  Guarantor of its  obligation  to pay any  additional
amounts  pursuant to subsection (b) in the event that, as a result of any change
in applicable law or treaty,  such  Indemnified Tax Person is no longer properly
entitled to deliver  certificates,  documents or other  evidence at a subsequent
date  establishing  the fact  that  such  Indemnified  Tax  Person  is no longer
entitled to such exemption or reduced rate.

     3.2 Illegality.  (a) If any Bank  determines  that the  introduction of any
Requirement  of  Law,  or  any  change  in any  Requirement  of  Law,  or in the
interpretation  or  administration  of any  Requirement  of  Law,  has  made  it
unlawful, or that any central bank or other Governmental  Authority has asserted
that it is  unlawful,  for any Bank or its  applicable  Lending  Office  to make
Eurodollar  Rate  Loans,  then,  on notice  thereof  by the Bank to the  Company
through the Administrative Agent, any obligation of that Bank to make Eurodollar
Rate Loans shall be suspended until the Bank notifies the  Administrative  Agent
and the Company  that the  circumstances  giving rise to such  determination  no
longer exist.

           (b)  If a  Bank  determines  that  it is  unlawful  to  maintain  any
Eurodollar Rate Loan, the Company shall, upon its receipt of notice of such fact
and demand from such Bank (with a copy to the Administrative  Agent),  prepay in
full such  Eurodollar  Rate Loans of that Bank then  outstanding,  together with
interest  accrued thereon and amounts  required under Section 3.4, either on the
last day of the Interest  Period thereof,  if the Bank may lawfully  continue to
maintain such Eurodollar Rate Loans to such day, or immediately, if the Bank may
not lawfully  continue to maintain such  Eurodollar Rate Loan. If the Company is
required to so prepay any  Eurodollar  Rate Loan,  then  concurrently  with such
prepayment,  the Company  shall borrow from the affected  Bank, in the amount of
such repayment, a Base Rate Loan.

     3.3  Increased  Costs and Reduction of Return.  (a) If any Bank  determines
that, due to either (i) the introduction of or any change (other than any change
by way of  imposition  of or  increase in reserve  requirements  included in the
calculation  of  the CD  Rate  or  the  Eurodollar  Rate  or in  respect  of the
assessment  rate payable by any Bank to the FDIC for insuring U.S.  deposits) in
or in the interpretation of any law or regulation or (ii) the compliance by that
Bank with any  guideline or request from any central bank or other  Governmental
Authority  (whether or not having the force of law), there shall be any increase
in the cost to such Bank of agreeing to make or making,  funding or  maintaining
any  Eurodollar  Rate Loans or CD Rate Loans,  then the Company  shall be liable
for, and shall from time to time,  upon demand (with a copy of such demand to be
sent to the  Administrative  Agent),  pay to the  Administrative  Agent  for the
account of such Bank,  additional  amounts as are sufficient to compensate  such
Bank for such increased costs.

           (b) If any Bank shall have  determined  that (i) the  introduction of
any  Capital  Adequacy  Regulation,  (ii) any  change  in any  Capital  Adequacy
Regulation,  (iii) any change in the  interpretation  or  administration  of any
Capital Adequacy Regulation by any central bank or other Governmental  Authority
charged with the interpretation or administration thereof, or (iv) compliance by
the Bank (or its Lending  Office) or any  corporation  controlling the Bank with
any Capital Adequacy  Regulation,  affects or would affect the amount of capital
required or expected to be maintained by the Bank or any corporation controlling
the Bank and  (taking  into  consideration  such  Bank's  or such  corporation's
policies  with  respect to capital  adequacy and such Bank's  desired  return on
capital)  determines  that  the  amount  of  such  capital  is  increased  as  a
consequence  of its  Commitment[s],  loans,  credits or  obligations  under this
Agreement,   then,  upon  demand  of  such  Bank  to  the  Company  through  the
Administrative  Agent,  the Company shall pay to the Bank,  from time to time as
specified by the Bank,  additional amounts sufficient to compensate the Bank for
such increase.

     3.4 Funding  Losses.  The Company shall  reimburse  each Bank and hold each
Bank  harmless from any loss or expense which the Bank may sustain or incur as a
consequence of:

           (a) the failure of the Company to make on a timely  basis any payment
of principal of any Eurodollar Rate Loan or CD Rate Loan;

           (b) the failure of the Company to borrow,  continue or convert a Loan
after the Company  has given (or is deemed to have given) a Notice of  Borrowing
or a Notice of Conversion/ Continuation;

           (c) the failure of the Company to make any  prepayment  in accordance
with any notice delivered under Section 2.8;

           (d) the  prepayment  (including  pursuant  to  Section  2.9) or other
payment (including after  acceleration  thereof) of an Eurodollar Rate Loan or a
CD Rate Loan on a day that is not the last day of the relevant  Interest Period;
or

           (e) the automatic conversion under Section 2.6 of any Eurodollar Rate
Loan or CD Rate  Loan to a Base  Rate  Loan on a day that is not the last day of
the relevant  Interest  Period;  including any such loss or expense arising from
the  liquidation  or  reemployment  of  funds  obtained  by it to  maintain  its
Eurodollar  Rate Loans or CD Rate Loans or from fees  payable to  terminate  the
deposits  from which  such funds were  obtained.  For  purposes  of  calculating
amounts  payable  by the  Company  to the Banks  under  this  Section  and under
subsection  3.3(a),  (i) each  Eurodollar  Rate  Loan  made by a Bank  (and each
related reserve,  special deposit or similar  requirement) shall be conclusively
deemed to have been  funded  at the  Dollar  deposits  used in  determining  the
Eurodollar  Rate for such  Eurodollar  Rate Loan by a matching  deposit or other
borrowing in the interbank  eurodollar  market for a comparable amount and for a
comparable  period,  whether  or not  such  Eurodollar  Rate  Loan is in fact so
funded,  and (ii) each CD Rate Loan  made by a Bank (and each  related  reserve,
special deposit or similar  requirement)  shall be  conclusively  deemed to have
been funded at the  Certificate of Deposit Rate used in determining  the CD Rate
for  such CD Rate  Loan by the  issuance  of its  certificate  of  deposit  in a
comparable amount and for a comparable period,  whether or not such CD Rate Loan
is in fact so funded.

     3.5 Inability to Determine  Rates. If the Majority Banks determine that for
any  reason  adequate  and  reasonable  means do not exist for  determining  the
Eurodollar Rate or the CD Rate for any requested Interest Period with respect to
a proposed  Eurodollar Rate Loan or CD Rate Loan, or that the Eurodollar Rate or
the CD Rate applicable pursuant to subsection 2.11(a) for any requested Interest
Period with respect to a proposed  Eurodollar Rate Loan or CD Rate Loan does not
adequately  and fairly  reflect the cost to the Banks of funding such Loan,  the
Administrative  Agent  will  promptly  so  notify  the  Company  and each  Bank.
Thereafter,  the  obligation  of the Banks to make or  maintain CD Rate Loans or
Eurodollar  Rate Loans,  as the case may be,  hereunder shall be suspended until
the Administrative Agent upon the instruction of the Majority Banks revokes such
notice in  writing.  Upon  receipt of such  notice,  the  Company may revoke any
Notice of Borrowing or Notice of  Conversion/Continuation  then submitted by it.
If the Company  does not revoke such  Notice,  the Banks shall make,  convert or
continue the Loans, as proposed by the Company,  in the amount  specified in the
applicable  notice  submitted  by the  Company,  but such  Loans  shall be made,
converted or continued as Base Rate Loans instead of CD Rate Loans or Eurodollar
Rate Loans, as the case may be.

     3.6  Certificates  of Banks.  Any Bank or Agent claiming  reimbursement  or
compensation under this Article III shall deliver to the Company (with a copy to
the Administrative  Agent) a certificate  setting forth in reasonable detail the
amount  payable to the Bank or Agent  hereunder  and such  certificate  shall be
conclusive and binding on the Company in the absence of manifest error.

     3.7 Survival. The agreements and obligations of the Company in this Article
III shall survive the payment of all other Obligations.


                                   ARTICLE IV

                              CONDITIONS PRECEDENT

     4.1  Conditions of Initial  Loans.  The obligation of each Bank to make its
initial Loan hereunder is subject to the following conditions:

           (a) The  Administrative  Agent  shall have  received on or before the
initial borrowing date all of the following,  in form and substance satisfactory
to the  Administrative  Agent and each Bank,  and in sufficient  copies for each
Bank:
                (i)   Credit  Agreement.  This Agreement  executed by each party
thereto;

                 (ii)  Resolutions; Incumbency.

                       (A) Copies of the  resolutions  of the board of directors
     of the Company and the Guarantor authorizing the transactions  contemplated
     hereby,  certified as of the Closing Date by the  Secretary or an Assistant
     Secretary of such Person; and

                       (B) A certificate of the Secretary or Assistant Secretary
     of the Company and the Guarantor  certifying the names and true  signatures
     of the  officers of the  Company or the  Guarantor  authorized  to execute,
     deliver and perform,  as  applicable,  this  Agreement,  and all other Loan
     Documents to be delivered by it hereunder;

                (iii) Organization   Documents;   Good  Standing.  Each  of  the
following documents:

                       (A) the articles or certificate of incorporation  and the
     bylaws of the Company and the  Guarantor as in effect on the Closing  Date,
     certified by the  Secretary  or  Assistant  Secretary of the Company or the
     Guarantor as of the Closing Date; and

                       (B) a good standing  certificate  for the Company and the
     Guarantor from the Secretary of State (or similar,  applicable Governmental
     Authority) of its state of incorporation;

                 (iv)  Legal Opinions.

                       (A)  An  opinion  of  Thomas  Steenburg,  counsel  to the
     Company and  addressed  to the Agents and the Banks,  substantially  in the
     form of Exhibit D-1; and

                       (B)  An  opinion  of  John  T.  Mulrain,  counsel  to the
     Guarantor and addressed to the Agents and the Banks,  substantially  in the
     form of Exhibit D-2;

                 (v) Payment of Fees.  Evidence of payment by the Company of all
accrued and unpaid  fees,  costs and expenses to the extent then due and payable
on the Closing Date, together with Attorney Costs of BofA to the extent invoiced
prior to or on the Closing Date, plus such additional  amounts of Attorney Costs
as shall constitute BofA's reasonable  estimate of Attorney Costs incurred or to
be incurred by it through the closing  proceedings  (provided that such estimate
shall not thereafter preclude final settling of accounts between the Company and
BofA);  including any such costs,  fees and expenses arising under or referenced
in Sections 2.12 and 15.4;

                 (vi) Certificate. A certificate signed by a Responsible Officer
of each of the Company and the Guarantor,  dated as of the Closing Date, stating
that:

                       (A)  the  representations  and  warranties  contained  in
     Article V are true and  correct on and as of such date,  as though  made on
     and as of such date;

                       (B) no Default,  Event of Default,  Guarantor  Default or
     Guarantor  Event of  Default  exists  or  would  result  from  the  initial
     Borrowing; and

                       (C) there has occurred  since December 31, 1996, no event
     or circumstance that has resulted or could reasonably be expected to result
     in a Material Adverse Effect; and

                (vii)  Other   Documents.   Such  other   approvals,   opinions,
documents or materials as the Agent or any Bank may request.

     1. (b) Existing Debt. All obligations under the Amended and Restated Credit
Agreement  dated as of October 31,  1995 among the  Company,  various  financial
institutions and Bank of America Illinois, as Agent shall have been paid in full
and such agreement shall have been terminated.

     4.2 Conditions to All Borrowings and Facility B Conversion.  The obligation
of each Bank to make any Loan to be made by it  (including  its initial Loan) or
to make a Facility B Conversion is subject to the  satisfaction of the following
conditions  precedent  on the  relevant  Borrowing  Date  or,  in the  case of a
Facility B Conversion, the relevant Facility Conversion Date:

           (a) Notice of  Borrowing/Notice  of Facility B Conversion.  The Agent
shall have received (with, in the case of the initial Loan only, a copy for each
Bank) a Notice of Borrowing or Notice of Facility B Conversion, as applicable;

           (b)   Continuation   of   Representations    and   Warranties.    The
representations  and warranties in Article V shall be true and correct on and as
of such  Borrowing Date or Facility  Conversion  Date with the same effect as if
made on and as of such Borrowing Date or Facility Conversion  Date(except to the
extent such  representations and warranties  expressly refer to an earlier date,
in which case they shall be true and correct as of such  earlier date and in the
case of Section 5.16, as otherwise permitted hereunder); and

           (c) No Existing  Default.  No Event of Default or  Default,  and with
respect to any Facility A Loan, Guarantor Default or Guarantor Event of Default,
or with respect to a Facility B Conversion,  Company Default or Company Event of
Default,  shall  exist or  shall  result  from  such  Borrowing  or  Facility  B
Conversion.
           (d)  Acquisitions.  As to any Loan, which would cause the outstanding
principal amount of the Loans to exceed  $80,000,000,  the PCC Acquisition shall
have occurred.

Each Notice of Borrowing  submitted by the Company  hereunder shall constitute a
representation  and  warranty by the Company  hereunder,  as of the date of each
such notice and as of each  Borrowing  Date,  that the conditions in Section 4.2
are satisfied.

     4.3  Conditions  to Facility B Conversion.  The  obligation of each Bank to
convert any Facility A Loan to a Facility B Loan is subject to the  satisfaction
of the following conditions precedent on the relevant Facility Conversion Date:

           (a) Senior Debt to EBITDA  Ratio.  The Senior Debt to EBITDA Ratio of
the  Company  and its  Subsidiaries  as of the last prior  quarter  shall not be
greater than 3.25 to 1.0.

           (b) Total Debt to  Capital  Ratio.  The Total Debt to Capital  Ratio,
giving  effect to the proposed  Facility B Loans,  shall not be greater than the
following percentages during the following periods:


 Percentage                  Periods
 58%                         date hereof through August 14, 1998
 53%                         August 15, 1998 through August 14, 2000
 48%                         August 15, 2000 and thereafter


           (c) Certificate.  A certificate signed by Responsible  Officer of the
Company,  dated as of the date of the proposed Facility B Loan, stating that the
conditions set forth in the clauses (a) and (b) have been met.



                                    ARTICLE V

                         REPRESENTATIONS AND WARRANTIES

     The Guarantor and the Company  represent and warrant to each Agent and each
Bank that:

    5.1   Corporate   Existence  and  Power.  The  Guarantor  and  each  of  its
Subsidiaries:

    1.     (a)  is a corporation  duly organized,  validly  existing and in good
standing under the laws of the jurisdiction of its incorporation;



<PAGE>


           (b) has the  power  and  authority  and  all  governmental  licenses,
authorizations,  consents and approvals to own its assets, carry on its business
and to execute, deliver, and perform its obligations under the Loan Documents;

           (c) is duly qualified as a foreign corporation and is licensed and in
good standing under the laws of each jurisdiction where its ownership,  lease or
operation of property or the conduct of its business requires such qualification
or license; and

           (d) is in compliance with all  Requirements of Law;  except,  in each
case  referred to in clause (c) or clause (d), to the extent that the failure to
do so could not reasonably be expected to have a Material Adverse Effect.

     5.2 Corporate Authorization; No Contravention.  The execution, delivery and
performance  by the Guarantor and its  Subsidiaries  of this  Agreement and each
other Loan Document to which such Person is party,  have been duly authorized by
all necessary corporate action, and do not and will not:

          (a)   contravene  the  terms  of any  of  that  Person's  Organization
Documents;

           (b) conflict with or result in any breach or contravention of, or the
creation of any Lien under, any document  evidencing any Contractual  Obligation
to which such Person is a party or any order, injunction,  writ or decree of any
Governmental Authority to which such Person or its property is subject; or

           (c)   violate any Requirement of Law.

     5.3   Governmental   Authorization.   No  approval,   consent,   exemption,
authorization,   or  other  action  by,  or  notice  to,  or  filing  with,  any
Governmental   Authority  is  necessary  or  required  in  connection  with  the
execution,  delivery or performance by, or enforcement against, the Guarantor or
any of its  Subsidiaries  of the  Agreement or any other Loan  Document,  except
filings  made prior to the date hereof and other  filings  which will be made as
required by law.

     5.4 Binding  Effect.  This  Agreement and each other Loan Document to which
the Guarantor or the Company is a party constitute the legal,  valid and binding
obligations of the Guarantor and the Company, enforceable against such Person in
accordance with their respective terms,  except as enforceability may be limited
by applicable bankruptcy,  insolvency, or similar laws affecting the enforcement
of  creditors'  rights  generally  or  by  equitable   principles   relating  to
enforceability.

     5.5 Litigation. Except as specifically disclosed in Schedule 5.5, there are
no  actions,  suits,  proceedings,  claims or disputes  pending,  or to the best
knowledge of the Guarantor,  threatened or contemplated,  at law, in equity,  in
arbitration or before any Governmental  Authority,  against the Guarantor or the
Company or its Subsidiaries or any of their respective properties which:

           (a) purport to affect or pertain to this  Agreement or any other Loan
Document, or any of the transactions contemplated hereby or thereby; or

           (b) as to which there exists a  substantial  likelihood of an adverse
determination,  which  determination  would  reasonably  be  expected  to have a
Material Adverse Effect. No injunction, writ, temporary restraining order or any
order of any nature has been issued by any court or other Governmental Authority
purporting to enjoin or restrain the execution,  delivery or performance of this
Agreement  or any  other  Loan  Document,  or  directing  that the  transactions
provided for herein or therein not be consummated as herein or therein provided.

     5.6 Contractual  Obligation.  As of the Closing Date, neither the Guarantor
nor any  Subsidiary  is in  default  under or with  respect  to any  Contractual
Obligation  in any  respect  which,  individually  or  together  with  all  such
defaults, could reasonably be expected to have a Material Adverse Effect.

     5.7 ERISA Compliance. Except as specifically disclosed in Schedule 5.7:

           (a) Each Plan is in  compliance  in all  material  respects  with the
applicable  provisions  of ERISA,  the Code and other  federal or state law. The
Guarantor and each ERISA  Affiliate has made all required  contributions  to any
Plan subject to Section 412 of the Code, and no application for a funding waiver
or an extension of any  amortization  period pursuant to Section 412 of the Code
has been made with respect to any Plan.

           (b) There are no  pending  or, to the best  knowledge  of  Guarantor,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could  reasonably  be expected to
result in a Material Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary  responsibility  rules with respect to any Plan which
has  resulted or could  reasonably  be expected to result in a Material  Adverse
Effect.

           (c) (i) No ERISA  Event has  occurred  or is  reasonably  expected to
occur;  (ii) no Pension Plan has any Unfunded Pension  Liability;  (iii) neither
the Guarantor nor any ERISA  Affiliate  has incurred,  or reasonably  expects to
incur,  any  liability  under Title IV of ERISA with respect to any Pension Plan
(other than premiums due and not delinquent  under Section 4007 of ERISA);  (iv)
neither the  Guarantor  nor any ERISA  Affiliate  has  incurred,  or  reasonably
expects to incur,  any  liability  (and no event has  occurred  which,  with the
giving of notice under  Section 4219 of ERISA,  would result in such  liability)
under Section 4201 or 4243 of ERISA with respect to a  Multiemployer  Plan;  and
(v) neither the Guarantor  nor any ERISA  Affiliate has engaged in a transaction
that could be subject to Section 4069 or 4212(c) of ERISA.

     5.8 Use of Proceeds;  Margin Regulations.  The proceeds of the Loans are to
be used solely for the purposes  set forth in and  permitted by Section 6.12 and
Section 7.6.  Neither the Guarantor nor any  Subsidiary is generally  engaged in
the business of purchasing or selling  Margin Stock or extending  credit for the
purpose of purchasing or carrying Margin Stock.

     5.9 Title to Properties. The Guarantor and each Subsidiary have good record
and marketable title in fee simple to, or valid leasehold interests in, all real
property  necessary  or  used  in  the  ordinary  conduct  of  their  respective
businesses,  except for such defects in title as could not,  individually  or in
the  aggregate,  have a Material  Adverse  Effect.  As of the Closing Date,  the
property of the Guarantor  and its  Subsidiaries  is subject to no Liens,  other
than Permitted Liens.

     5.10 Taxes. The Guarantor and its  Subsidiaries  have filed all Federal and
other material tax returns and reports  required to be filed,  and have paid all
Federal  and other  material  taxes,  assessments,  fees and other  governmental
charges  levied  or  imposed  upon  them or their  properties,  income or assets
otherwise due and payable,  except those which are being contested in good faith
by appropriate proceedings and for which adequate reserves have been provided in
accordance with GAAP. There is no proposed tax assessment  against the Guarantor
or any Subsidiary that would, if made, have a Material Adverse Effect.

     5.11 Financial  Condition.  (a) The statutory  financial  statements of the
Guarantor and its Primary  Insurance  Subsidiaries  dated December 31, 1996, and
the statutory statements of the Guarantor and its Primary Insurance Subsidiaries
dated  March 31,  1997,  and the  related  statements  of income or  operations,
shareholders' equity and cash flows for the fiscal periods ended on those dates:

                 (i) were prepared in accordance with SAP  consistently  applied
     throughout the period covered thereby,  except as otherwise expressly noted
     therein,  subject in the case of the March 31, 1997 statements to ordinary,
     good faith year end audit adjustments;

                 (ii) fairly  present the  financial  condition of the Guarantor
     and its Primary  Insurance  Subsidiaries as of the date thereof and results
     of operations for the period covered thereby; and

                 (iii) except as  specifically  disclosed in Schedule 5.11, show
     all material indebtedness and other liabilities,  direct or contingent,  of
     the  Guarantor  and  its  Primary  Insurance  Subsidiaries  as of the  date
     thereof,   including   liabilities  for  taxes,  material  commitments  and
     Contingent Obligations.

           (b) The audited consolidated  financial statements of the Company and
its  Subsidiaries  dated  December  31,  1996,  and the  unaudited  consolidated
statements  of the  Company  and its  Subsidiaries  dated March 31, 1997 and the
related  consolidated  statements of income or operations,  shareholders' equity
and cash flows for the fiscal periods ended on those dates:

                 (i) were prepared in accordance with GAAP consistently  applied
     throughout the period covered thereby,  except as otherwise expressly noted
     therein,  subject in the case of the March 31, 1997 statements to ordinary,
     good faith year end audit adjustments;

                 (ii) fairly present the financial  condition of the Company and
     its  Subsidiaries  as of the date thereof and results of operations for the
     period covered thereby; and

                 (iii) except as  specifically  disclosed in Schedule 5.11, show
     all material indebtedness and other liabilities,  direct or contingent,  of
     the  Company  and its  consolidated  Subsidiaries  as of the date  thereof,
     including  liabilities  for  taxes,  material  commitments  and  Contingent
     Obligations.

           (c) Since  December  31,  1996,  there has been no  Material  Adverse
Effect.

     5.12 Environmental  Matters.  The Guarantor conducts in the ordinary course
of business a review of the effect of existing  Environmental  Laws and existing
Environmental Claims on its business, operations and properties, and as a result
thereof the  Guarantor  has  reasonably  concluded to the best of its  knowledge
that, except as specifically disclosed in Schedule 5.12, such Environmental Laws
and Environmental Claims could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.

     5.13 Regulated Entities. The Company is not subject to regulation under the
Public  Utility  Holding  Company  Act of  1935,  the  Federal  Power  Act,  the
Interstate  Commerce Act, any state public  utilities code, or any other Federal
or state statute or regulation  limiting its ability to incur  Indebtedness.  No
filings,  approvals or consents are required under the Investment Company Act of
1940 for the enforceability of this Agreement or any other Loan Document.

     5.14 No Burdensome  Restrictions.  Neither the Guarantor nor any Subsidiary
is a  party  to or  bound  by any  Contractual  Obligation,  or  subject  to any
restriction in any Organization Document, or any Requirement of Law, which could
reasonably be expected to have a Material Adverse Effect.

     5.15 Copyrights,  Patents,  Trademarks and Licenses,  etc. The Guarantor or
its  Subsidiaries  own or are licensed or otherwise have the right to use all of
the patents,  trademarks,  service marks, trade names,  copyrights,  contractual
franchises,  authorizations  and other rights that are reasonably  necessary for
the operation of their respective  businesses,  without conflict with the rights
of any other Person. To the best knowledge of the Guarantor,  no slogan or other
advertising device, product,  process, method, substance, part or other material
now  employed,  or now  contemplated  to be  employed,  by the  Guarantor or any
Subsidiary  infringes  upon any  rights  held by any  other  Person.  Except  as
specifically  disclosed in Schedule 5.5, no claim or litigation regarding any of
the  foregoing  is pending or  threatened,  and no  patent,  invention,  device,
application,  principle or any statute, law, rule, regulation,  standard or code
is pending or, to the knowledge of the  Guarantor,  proposed,  which,  in either
case, could reasonably be expected to have a Material Adverse Effect.

     5.16   Subsidiaries.   As  of  the  Closing  Date,  the  Guarantor  has  no
Subsidiaries  other than those  specifically  disclosed  in part (a) of Schedule
5.16 hereto and the Company has no equity  investments in any other  corporation
or entity other than those specifically disclosed in part (b) of Schedule 5.16.

     5.17  Insurance.  Except as  specifically  disclosed in Schedule  5.17, the
properties of the Guarantor and its  Subsidiaries  are insured with  financially
sound and reputable insurance companies not Affiliates of the Guarantor, in such
amounts,  with such  deductibles  and  covering  such  risks as are  customarily
carried by companies engaged in similar businesses and owning similar properties
in localities where the Guarantor or such Subsidiary operates.

     5.18 Full Disclosure. None of the representations or warranties made by the
Guarantor  or  any  Subsidiary  in  the  Loan  Documents  as of  the  date  such
representations  and  warranties  are  made  or  deemed  made,  and  none of the
statements contained in any exhibit,  report, statement or certificate furnished
by or on behalf of the Guarantor or any  Subsidiary in connection  with the Loan
Documents  (including the offering and disclosure  materials  delivered by or on
behalf of the  Guarantor to the Banks prior to the Closing  Date),  contains any
untrue  statement of a material  fact or omits any material  fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they are made, not misleading as of the time when made
or delivered;  provided,  that, to the extent the representations and warranties
set forth in this  Section  5.18 relate to Seneca or PCC,  they shall be made to
the best of the knowledge of the Guarantor and the Company after due inquiry.

     5.19 PCC Acquisition  Agreement.  The representations and warranties of the
Company and, to the best of the knowledge of the Company after due inquiry,  the
seller  contained in the PCC  Acquisition  Agreement (a true and correct copy of
which PCC  Acquisition  Agreement,  together  with all  schedules  and  exhibits
thereto,  has been delivered to the Banks), are true and correct in all respects
which, upon  consummation of the PCC Acquisition,  could have a Material Adverse
Effect. As of the date of the PCC Acquisition,  (i) the Company shall have taken
all necessary  corporate  actions to authorize the PCC Acquisition;  and (ii) no
representation  made by the  Company  or,  to the best of the  knowledge  of the
Company after due inquiry,  the seller under such PCC  Acquisition  Agreement in
any notices or filings with the shareholders of the Company or such seller, with
the SEC or any applicable state securities  commissions or with any governmental
authority  including,  without limitation,  any  representations  concerning any
agreement  with,  or  financing  provided  by,  the  Banks,  contain  any untrue
statement of a material  fact or omit to state any material  fact required to be
stated  therein or necessary in order to make the  statements  made therein,  in
light of the  circumstances  under which they are made, not misleading as of the
time when made or delivered.

     5.20 Seneca Acquisition  Agreement.  The  representations and warranties of
the Company and, to the best of the  knowledge of the Company after due inquiry,
the seller  contained  in the Seneca  Acquisition  Agreement (a true and correct
copy of which Seneca  Acquisition  Agreement,  together  with all  schedules and
exhibits thereto, has been delivered to the Seneca), are true and correct in all
respects  which,  upon  consummation  of the  Seneca  Acquisition,  could have a
Material  Adverse  Effect.  As of the date of the  Seneca  Acquisition,  (i) the
Company shall have taken all necessary corporate actions to authorize the Seneca
Acquisition;  and (ii) no representation  made by the Company or, to the best of
the  knowledge of the Company  after due  inquiry,  the seller under said Seneca
Acquisition  Agreement  in any notices or filings with the  shareholders  of the
Company  or  such  seller,  with  the  SEC or any  applicable  state  securities
commissions or with any governmental  authority  including,  without limitation,
any representations concerning any agreement with, or financing provided by, the
Banks,  contain  any untrue  statement  of a material  fact or omit to state any
material  fact  required to be stated  therein or necessary in order to make the
statements  made  therein,  in light of the  circumstances  under which they are
made, not misleading as of the time when made or delivered.


                                   ARTICLE VI

                              AFFIRMATIVE COVENANTS

     So long as any Bank shall  have any  Commitment  hereunder,  or any Loan or
other Obligation  shall remain unpaid or unsatisfied,  unless the Majority Banks
waive compliance in writing:



<PAGE>


     6.1 Financial Statements. The Guarantor shall deliver to the Agent, in form
and detail satisfactory to the Administrative Agent and the Majority Banks, with
sufficient copies for each Bank:

           (a) as soon as  available,  but not later than 120 days after the end
of each fiscal year,  a copy of the audited  consolidated  balance  sheet of the
Company  and  its  Subsidiaries  as at the  end of such  year  and  the  related
consolidated  statements of income or operations,  shareholders' equity and cash
flows for such year,  setting forth in each case in comparative form the figures
for the previous fiscal year, and accompanied by the opinion of Price Waterhouse
LLP  or  another   nationally-recognized   independent  public  accounting  firm
("Independent   Auditor")  which  report  shall  state  that  such  consolidated
financial  statements  present  fairly the  financial  position  for the periods
indicated  in  conformity  with GAAP  applied on a basis  consistent  with prior
years. Such opinion shall not be qualified or limited because of a restricted or
limited  examination by the Independent  Auditor of any material  portion of the
Company's or any Subsidiary's records;

           (b) as soon as available, but not later than 60 days after the end of
each of the first  three  fiscal  quarters of each  fiscal  year,  a copy of the
unaudited  consolidated  balance sheet of the Company and its Subsidiaries as of
the end of such  quarter  and the  related  consolidated  statements  of income,
shareholders'  equity and cash flows for the period  commencing on the first day
and  ending on the last day of such  quarter,  and  certified  by a  Responsible
Officer of the Company as fairly presenting, in accordance with GAAP (subject to
ordinary, good faith year-end audit adjustments), the financial position and the
results of operations of the Company and the Subsidiaries;

           (c) as soon as  available,  but not later than 120 days after the end
of each fiscal year, a copy of the Annual  Statement of the  Guarantor  for such
fiscal year prepared in accordance with SAP and accompanied by the certification
of the chief  executive a Responsible  Officer of the Guarantor that such Annual
Statement  presents fairly in accordance with SAP the financial  position of the
Guarantor for the period then ended;

           (d) as soon as  possible,  but no later than 60 days after the end of
each of the first  three  fiscal  quarters of each  fiscal  year,  a copy of the
quarterly statement of the Guarantor for each such fiscal quarter,  all prepared
in accordance  with GAAP and accompanied by the  certification  of a Responsible
Officer of the Guarantor  that all such quarterly  statements  present fairly in
accordance with GAAP the financial position of the Guarantor for the period then
ended;

           (e) as soon as  available,  a copy of the  Guarantor's  "Statement of
Actuarial   Opinion"   which  is  provided  to  the  Department  (or  equivalent
information  should the Department no longer require such a statement) as to the
adequacy of loss reserves of the Guarantor, which opinion shall be in the format
prescribed by the Insurance Code;

           (f) as soon as available,  a copy of the  Management  Discussion  and
Analysis  filed  with  the  Department  with  respect  to any  of the  foregoing
financial statements and such other information; and

           (g)  within  90 days  after  each  fiscal  year,  projections  of the
Company's  financial  performance  on an annual  basis for the next fiscal year,
prepared by the Company's management.

     6.2  Certificates;  Other  Information.  The Company  shall  furnish to the
Administrative Agent, with sufficient copies for each Bank:

           (a)  concurrently  with  the  delivery  of the  financial  statements
referred to in subsections 6.1(a) and (b), a Compliance  Certificate executed by
a Responsible Officer of the Company;

           (b) promptly, copies of all financial statements and reports that the
Guarantor or the Company sends to its policyholders or shareholders,  and copies
of all financial statements and regular,  periodical or special reports that the
Guarantor or any Subsidiary may make to, or file with, the SEC;

           (c) promptly,  upon a change in the Guarantor's Claims Paying Rating,
written notice of such change by a Responsible Officer; and

           (d) promptly,  such  additional  information  regarding the business,
financial  or  corporate  affairs  of the  Guarantor  or any  Subsidiary  as the
Administrative  Agent,  at the  request  of any  Bank,  may  from  time  to time
reasonably request.

     6.3  Notices.  The  Company and the  Guarantor  shall  promptly  notify the
Administrative Agent and each Bank:

           (a)   of any change in a Rating;

           (b) of the  occurrence  of any Default,  Event of Default,  Guarantor
Default, Guarantor Event of Default, Company Default or Company Event of Default
and of the occurrence or existence of any event or circumstance that foreseeably
will become a Default, Event of Default,  Guarantor Default,  Guarantor Event of
Default; Company Default or Company Event of Default;

           (c) of any  matter  that has  resulted  or may  result in a  Material
Adverse  Effect,  including  (i) breach or  non-performance  of, or any  default
under,  a Contractual  Obligation of the Guarantor or any  Subsidiary;  (ii) any
dispute,  litigation,  investigation,   proceeding  or  suspension  between  the
Guarantor  or any  Subsidiary  and any  Governmental  Authority;  or  (iii)  the
commencement  of, or any material  development  in, any litigation or proceeding
affecting the Guarantor or any Subsidiary;  including pursuant to any applicable
Environmental Laws;

           (d) of the  occurrence of any of the following  events  affecting the
Guarantor or any ERISA  Affiliate  (but in no event more than 10 days after such
event),  and  deliver  to the  Administrative  Agent and each Bank a copy of any
notice with  respect to such event that is filed with a  Governmental  Authority
and any notice  delivered by a  Governmental  Authority to the  Guarantor or any
ERISA Affiliate with respect to such event:

                 (i)   an ERISA Event;

                (ii)  a material  increase in the Unfunded Pension  Liability of
     any Pension Plan;

                 (iii) the adoption of, or the commencement of contributions to,
     any Plan  subject  to Section  412 of the Code by the  Company or any ERISA
     Affiliate; or

                 (iv) the adoption of any amendment to a Plan subject to Section
     412 of the Code,  if such  amendment  results;  in a material  increase  in
     contributions or Unfunded Pension Liability;

           (e) of any  material  change  in  accounting  policies  or  financial
reporting practices by the Guarantor or any of its Primary Subsidiaries; and

           (f)  of  any  proposed  Acquisition  by  the  Company  or  any of its
Subsidiaries,  the total  consideration  for  which  shall  exceed  $10,000,000,
together with pro forma financial  statements  giving effect to such Acquisition
but subject to the requirements of any applicable confidentiality agreement.

           Each notice  under this  Section  shall be  accompanied  by a written
statement by a Responsible  Officer of the Company  setting forth details of the
occurrence  referred  to  therein,  and  stating  what action the Company or any
affected Subsidiary proposes to take with respect thereto and at what time. Each
notice under  subsection  6.3(b) shall describe with  particularity  any and all
clauses or  provisions  of this  Agreement or other Loan Document that have been
(or foreseeably will be) breached or violated.

     6.4 Preservation of Corporate Existence, Etc. The Guarantor and the Company
shall, and shall cause each of their respective Subsidiaries to:

           (a)  preserve  and  maintain  in full force and effect its  corporate
existence  and good  standing  under  the laws of its state or  jurisdiction  of
incorporation;

           (b) preserve  and maintain in full force and effect all  governmental
rights, privileges,  qualifications,  permits, licenses and franchises necessary
or desirable in the normal conduct of its business;

          (c)   use reasonable efforts,  in the ordinary course of business,  to
preserve its business organization and goodwill; and

           (d)  preserve  or renew all of its  registered  patents,  trademarks,
trade names and service marks, the non-preservation of which could reasonably be
expected to have a Material Adverse Effect.

     6.5 Maintenance of Property.  The Guarantor and the Company shall maintain,
and shall cause each of their respective  Subsidiaries to maintain, and preserve
all its property  which is used or useful in its business in good working  order
and condition, ordinary wear and tear excepted.

     6.6  Insurance.  The Guarantor and the Company  shall  maintain,  and shall
cause each of their respective  Subsidiaries to maintain, with financially sound
and reputable independent insurers, insurance with respect to its properties and
business  against  loss or damage of the kinds  customarily  insured  against by
Persons  engaged  in the same or  similar  business,  of such  types and in such
amounts as are  customarily  carried under similar  circumstances  by such other
Persons.

     6.7 Payment of Obligations.  The Guarantor and the Company shall, and shall
cause each of their  respective  Subsidiaries  to, pay and discharge as the same
shall become due and payable, all their respective  obligations and liabilities,
including:

           (a) all tax  liabilities,  assessments  and  governmental  charges or
levies upon it or its properties or assets,  unless the same are being contested
in good faith by  appropriate  proceedings  and adequate  reserves in accordance
with GAAP are being maintained by the Guarantor, the Company or such Subsidiary;

          (b)   all lawful claims which,  if unpaid,  would by law become a Lien
upon its property; and

           (c) all indebtedness, as and when due and payable, but subject to any
subordination  provisions  contained in any  instrument or agreement  evidencing
such Indebtedness.

     6.8 Compliance  with Laws. The Guarantor and the Company shall comply,  and
shall cause each of their  respective  Subsidiaries  to comply,  in all material
respects  with all  Requirements  of Law of any  Governmental  Authority  having
jurisdiction over it or its business (including the Federal Fair Labor Standards
Act),  except such as may be  contested in good faith or as to which a bona fide
dispute may exist.

     6.9 Compliance with ERISA.  The Company shall,  and shall cause each of its
ERISA  Affiliates  to: (a)  maintain  each Plan in  compliance  in all  material
respects with the applicable  provisions of ERISA, the Code and other federal or
state law; (b) cause each Plan which is qualified  under  Section  401(a) of the
Code to maintain such qualification;  and (c) make all required contributions to
any Plan subject to Section 412 of the Code.

     6.10  Inspection  of Property and Books and Records The  Guarantor  and the
Company shall maintain, and shall cause each of their respective Subsidiaries to
maintain,  proper books of record and account,  in which full,  true and correct
entries in  conformity  with GAAP or SAP, as  applicable,  consistently  applied
shall be made of all financial transactions and matters involving the assets and
business of the Guarantor,  the Company and such  Subsidiary.  The Guarantor and
the Company shall permit, and shall cause each of their respective  Subsidiaries
to permit,  representatives and independent contractors of the Agent or any Bank
to visit and  inspect  any of their  respective  properties,  to  examine  their
respective  corporate,  financial and operating records, and make copies thereof
or abstracts  therefrom,  and to discuss their respective affairs,  finances and
accounts with their  respective  directors,  officers,  and  independent  public
accountants,  all at the  expense of the  Guarantor  and the Company and at such
reasonable  times during normal business hours and as often as may be reasonably
desired, upon reasonable advance notice to the Company; provided,  however, when
an Event of  Default,  Guarantor  Event of Default  or Company  Event of Default
exists the Agent or any Bank may do any of the foregoing  during normal business
hours and without advance notice.

     6.11  Environmental  Laws. The Guarantor and the Company  shall,  and shall
cause each of their respective  Subsidiaries to, conduct its operations and keep
and maintain its property in compliance with all Environmental Laws.

     6.12 Use of Proceeds.  The Company  shall use the proceeds of the Loans for
working capital purposes including the acquisition of PCC, Seneca and certain of
its Affiliates and other Acquisitions not in contravention of any Requirement of
Law or of any Loan Document;  provided, however, that such proceeds shall not be
used for any Acquisition, if the board of directors of the entity to be acquired
shall not have approved such Acquisition.

     6.13 Holding  Agreement.  The Guarantor  agrees that on or before March 31,
1998, it will cause the obligations under the Term Credit Agreement  extended to
PM Holdings, Inc. and guaranteed by the Guarantor, dated November 15, 1995 to be
paid in full and such agreement to be terminated.



<PAGE>


                                   ARTICLE VII

                               NEGATIVE COVENANTS

     So long as any Bank shall  have any  Commitment  hereunder,  or any Loan or
other Obligation  shall remain unpaid or unsatisfied,  unless the Majority Banks
waive compliance in writing:

     7.1 Limitation on Liens.  The Guarantor  shall not, and shall not suffer or
permit any Subsidiary to, directly or indirectly, make, create, incur, assume or
suffer  to exist  any Lien  upon or with  respect  to any part of its  property,
whether now owned or hereafter  acquired,  other than the following  ("Permitted
Liens"):

           (a) any Lien existing on property of the Guarantor or any  Subsidiary
on the  Closing  Date  and set  forth  in  Schedule  7.1  securing  Indebtedness
outstanding on such date;

           (b)   any Lien created under any Loan Document;

           (c) Liens for taxes, fees,  assessments or other governmental charges
which are not delinquent or remain  payable  without  penalty,  or to the extent
that non-payment thereof is permitted by Section 6.7, provided that no notice of
lien has been filed or recorded under the Code;

           (d)   Liens on 12b-1 Assets which have been sold;

           (e) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's  or other similar  Liens arising in the ordinary  course of business
which are not delinquent or remain payable without penalty;

           (f)  Liens  (other  than any Lien  imposed  by ERISA)  consisting  of
pledges or deposits  required in the ordinary  course of business in  connection
with workers'  compensation,  unemployment  insurance and other social  security
legislation;

           (g) Liens  consisting  of  judgment  or  judicial  attachment  liens,
provided that the  enforcement of such Liens is effectively  stayed and all such
liens  in the  aggregate  at any  time  outstanding  for the  Guarantor  and its
Subsidiaries do not exceed $10,000,000;

           (h)  easements,   rights-of-way,   restrictions   and  other  similar
encumbrances  incurred  in  the  ordinary  course  of  business  which,  in  the
aggregate,  are  not  substantial  in  amount,  and  which  do not  in any  case
materially  detract from the value of the property  subject thereto or interfere
with  the  ordinary   conduct  of  the  businesses  of  the  Guarantor  and  its
Subsidiaries;

           (i) Liens  arising  solely by virtue of any  statutory  or common law
provision relating to banker's liens, securities intermediary's liens, rights of
set-off  or similar  rights and  remedies  as to  deposit  accounts,  securities
accounts  or other  funds  maintained  with a creditor  depository  institution;
provided  that (i) such  deposit  account  is not a  dedicated  cash  collateral
account and is not subject to  restrictions  against  access by the Guarantor in
excess of those set forth by  regulations  promulgated by the FRB, and (ii) such
deposit  account or  securities  account is not intended by the Guarantor or any
Subsidiary to provide  collateral to the depository  institution  providing such
account;

           (j)  Liens on real  property  and  related  assets  of the  Guarantor
granted  to  any  home  loan  bank,   provided  that  the  aggregate  amount  of
Indebtedness  secured by all such Liens,  when taken together with the aggregate
amount of Indebtedness  secured by Liens permitted by clause (k) of this Section
7.1 shall not exceed $100,000,000 at any one time outstanding; and

           (k)  additional   Liens  securing   Indebtedness  not  in  excess  of
$10,000,000 at any time outstanding.

    7.2   Mergers,  Consolidations  and Sales of Assets. The Guarantor will not,
and will not permit any Primary Subsidiary to

          (a)  consolidate  with or be a party to a merger with any other Person
     or

           (b) sell,  lease or otherwise  dispose of any substantial part of its
     Properties,  provided that the  foregoing  shall not apply to or operate to
     prevent (i) reinsurance and similar risk sharing  arrangements entered into
     in the ordinary  course of business,  (ii) sales or other  dispositions  of
     assets  acquired in  satisfaction  of obligations  owing the Guarantor or a
     Primary Subsidiary, (iii) mergers of a Primary Subsidiary with and into the
     Guarantor and other mergers not involving the  Guarantor,  or (iv) the sale
     of all or any substantial part of the assets of, or of the equity interests
     held by the Guarantor in, any Primary  Subsidiary so long as in the case of
     each of the  matters  described  in clauses  (i)  through  (iv)  above,  no
     Default,  Event of  Default,  Company  Default,  Company  Event of Default,
     Guarantor  Default or Guarantor Event of Default shall have occurred and be
     continuing  or would  occur  as a  result  thereof.  The  foregoing  to the
     contrary  notwithstanding,  the  Guarantor  will  not  in any  event  sell,
     transfer or  otherwise  dispose of capital  stock of the Borrower or permit
     the merger of the Borrower  into any other Person other than the  Guarantor
     if after giving effect thereto the Borrower would no longer be a Subsidiary
     of the Guarantor or would not be the survivor of the merger in question.

     7.3 Loans and Investments.  The Guarantor shall not purchase or acquire, or
suffer or permit any  Subsidiary to purchase or acquire,  or make any commitment
therefor,  any capital  stock,  equity  interest,  or any  obligations  or other
securities  of, or any  interest  in, any Person,  or make or commit to make any
Acquisitions,  or make or commit to make any advance,  loan, extension of credit
or capital  contribution to or any other investment in, any Person including any
Affiliate of the Company, except for:

           (a)   investments in cash equivalents;

          (b)   investments  by the Guarantor in compliance  with all applicable
regulatory requirements;

          (c)  investments  by the  Company in the  ordinary  course of business
consistent with past practices; and

           (d)  Acquisitions,  so  long  as (i) the  acquired  entity  is in the
similar or related business as the Guarantor and its Subsidiaries and (ii) after
giving  effect to the  Acquisition,  (A) no Default,  Event of Default,  Company
Default,  Company  Event of Default,  Guarantor  Default or  Guarantor  Event or
Default  shall have  occurred and be  continuing  and (B) the  Guarantor and the
Company would be in compliance with all financial  covenants hereof,  calculated
on a pro forma basis at the time of the  Acquisition  and as if the  Acquisition
had taken place at the beginning of the four fiscal  quarter period ending as of
the last fiscal  quarter end,  with the Guarantor  providing a certificate  with
respect thereto.

     7.4 Limitation on Indebtedness. The Company shall not, and shall not suffer
or permit  any  Subsidiary  to,  create,  incur,  assume,  suffer  to exist,  or
otherwise  become or remain  directly or indirectly  liable with respect to, any
Indebtedness, except:

           (a)   Indebtedness available pursuant to this Agreement;

          (b)   Indebtedness  consisting  of  Contingent  Obligations  permitted
pursuant to Section 7.7;

          (c)   Indebtedness  existing  on the  Closing  Date  and set  forth in
Schedule 7.4; and

           (d)  Indebtedness of the Company and its Subsidiaries in an amount at
any time  outstanding not in excess of (i) $20,000,000 or (ii)  $30,000,000 when
added to the Contingent Obligations permitted pursuant to Section 7.7(c).

     7.5 Transactions  with  Affiliates.  The Guarantor shall not, and shall not
suffer  or  permit  any  Subsidiary  to,  enter  into any  transaction  with any
Affiliate  of the  Guarantor,  except  upon  fair and  reasonable  terms no less
favorable to the Guarantor or such  Subsidiary than would obtain in a comparable
arm's-length transaction with a Person not an Affiliate of the Guarantor or such
Subsidiary.

     7.6 Use of Proceeds.  The Company shall not, and shall not suffer or permit
any Subsidiary to, use any portion of the Loan proceeds, directly or indirectly,
(i) to purchase or carry  Margin  Stock,  (ii) to repay or  otherwise  refinance
indebtedness  of the Company or others  incurred  to  purchase  or carry  Margin
Stock,  (iii) to extend  credit for the purpose of  purchasing  or carrying  any
Margin Stock, or (iv) to acquire any security in any transaction that is subject
to Section 13 or 14 of the Exchange Act.

     7.7 Contingent Obligations.  The Company shall not, and shall not suffer or
permit  any  Subsidiary  to,  create,  incur,  assume  or  suffer  to exist  any
Contingent Obligations except:

          (a)   endorsements  for  collection or deposit in the ordinary  course
of business;

           (b)  Contingent  Obligations  of the  Company  and  its  Subsidiaries
existing as of the Closing Date and listed in Schedule 7.7;

           (c) other Contingent  Obligations in aggregate  amounts not to exceed
(i) $15,000,000 or (ii)  $30,000,000  when added to the  Indebtedness  permitted
pursuant to Section 7.4(d),at any time outstanding; and

           (d)   Guarantees of Indebtedness of Subsidiaries.

     7.8  Joint  Ventures.  The  Company  shall not  enter  into or  permit  any
Subsidiary  to enter into,  any Joint  Venture  involving an investment by it in
excess of $10,000,000  for all Joint Ventures after the date hereof except Joint
Ventures with its Affiliates.

     7.9 Lease  Obligations.  The  Guarantor  shall not, and shall not suffer or
permit  any  Subsidiary  to,  create  or  suffer  to exist  not in excess of any
obligations for the payment of rent for any property under lease or agreement to
lease, except for:

          (a)   operating   leases   entered  into  by  the   Guarantor  or  any
Subsidiary in the ordinary course of business; and

          (b)   capital  leases  entered into by the Guarantor or any Subsidiary
to finance the acquisition of equipment;

     7.10 Restricted Payments.  The Guarantor shall not, and shall not suffer or
permit  any  Subsidiary  to,  declare  or make  any  dividend  payment  or other
distribution of assets,  properties,  cash, rights, obligations or securities to
its policy holders or shareholders, except that:

          (a)   the  Guarantor  and its  Insurance  Subsidiaries  may pay policy
holder dividends;

          (b)   the  Company  may  make  dividends  and  distributions,  payable
solely in common stock;


<PAGE>


           (c) the Company  may in any fiscal  quarter  pay cash  dividends  and
repurchase  stock not in excess of its income (not  including  any gain from the
sale of  capital  stock of  Beutel  Goodman  and  Company  Ltd.) in such  fiscal
quarter, so long as after giving effect thereto,  no Default,  Event of Default,
Company Default, Company Event of Default,  Guarantor Default or Guarantor Event
of Default shall have occurred and be continuing; and

           (d) Any Subsidiary of the Guarantor  (other than the Company) may pay
in any fiscal quarter cash dividends, so long as after giving effect thereto, no
Default, Event of Default, Company Default, Company Event of Default,  Guarantor
Default or Guarantor Event of Default shall have occurred and be continuing.

     7.11 ERISA.  The Guarantor shall not, and shall not suffer or permit any of
its ERISA Affiliates to: (a) engage in a prohibited  transaction or violation of
the fiduciary  responsibility  rules with respect to any Plan which has resulted
or could  reasonably  be  expected to result in  liability  of the Company in an
aggregate  amount in excess of $5,000,000  or (b) engage in a  transaction  that
could be subject to Section 4069 or 4212(c) of ERISA.

     7.12 Change in Business.  The Guarantor  shall not, and shall not suffer or
permit any Subsidiary to, engage in any material line of business  substantially
different  from those  lines of  business  carried on by the  Guarantor  and its
Subsidiaries on the date hereof.

     7.13 Accounting  Changes.  The Guarantor shall not, and shall not suffer or
permit any Subsidiary to, make any significant change in accounting treatment or
reporting  practices,  except as  required  by GAAP or SAP, or change the fiscal
year of the Guarantor or of any Subsidiary.

     7.14 Pari Passu. The Guarantor shall cause the Obligations to rank at least
pari passu with all other senior  unsecured  Indebtedness of the Guarantor.  The
Company shall cause the  Obligations  to rank at least pari passu with all other
senior unsecured Indebtedness of the Company.

     7.15 Phoenix. The Company shall retain the word "Phoenix" in its name.

     7.16  Subordinated Debt and Preferred Stock. The Company shall not make any
payments,  or set  aside  funds  to make  payments,  on  preferred  stock or any
Subordinated  Debt into which  preferred  stock is  converted;  except  that the
Company may make regularly  scheduled  interest and dividend payments thereon so
long as after  giving  effect  thereto,  no Default,  Event of Default,  Company
Default,  Company  Event of Default,  Guarantor  Default or  Guarantor  Event of
Default shall have occurred and be continuing.


<PAGE>


     7.17 Capital Expenditures.  The Company and its Subsidiaries shall not make
any capital expenditures in excess of $15,000,000 in any fiscal year.


                                  ARTICLE VIII

                         GUARANTOR'S FINANCIAL COVENANTS

     So long as any Bank shall have any  Commitments  hereunder,  or any Loan or
other Obligations shall remain unpaid or unsatisfied,  unless the Majority Banks
waive compliance in writing:

     8.1  Guarantor's  Minimum Total SAP Adjusted  Capital.  The Guarantor shall
maintain a Total SAP Adjusted Capital of not less than  $825,000,000 plus 50% of
net income (if  greater  than zero) for each fiscal  quarter  ending on or after
September 30, 1997.

     8.2 Invested Assets.  The Guarantor shall not permit Invested Assets of the
Guarantor and its Primary Insurance Subsidiaries  consisting of notes, bonds and
other obligations classified as bonds which bear NAIC Ratings from three to six,
both inclusive, to exceed 5.5% of Net Invested Assets.

     8.3 NAIC  Ratings.  The  Guarantor  shall not  permit  the  portion  of the
Invested  Assets  of  the  Guarantor  and  its  Primary  Insurance  Subsidiaries
consisting of notes, bonds and other obligations  classified as bonds which bear
NAIC Ratings from five to six to exceed 13% of Total SAP Adjusted Capital.

     8.4 Real Estate. The Guarantor shall not permit the portion of the Invested
Assets of the Guarantor and its Primary  Insurance  Subsidiaries in real estate,
real  estate  acquired  in  satisfaction  of  indebtedness  (exclusive  of  such
investments  of  either  category  occupied  by the  Guarantor  or  its  Primary
Insurance  Subsidiaries  for use in their  business) plus mortgage loans on real
estate to exceed 32% of Net Invested Assets.

     8.5 Risk Based Capital.  The Guarantor shall maintain a minimum  Risk-Based
Capital Ratio of not less than 1.75 to 1.0.

     8.6  Non-Performing  Real Estate.  The Guarantor  shall not permit the book
value of the investment of the Guarantor and its Primary Insurance  Subsidiaries
in  non-performing  real estate under SAP,  prior to any reserves or  write-offs
with respect thereto, to exceed 30% of Total SAP Adjusted Capital.

     8.7   Indebtedness   to  Capital.   The  Guarantor  shall  not  permit  the
consolidated Indebtedness of the Guarantor and its Subsidiaries to exceed 75% of
Total SAP Adjusted Capital.


                                   ARTICLE IX

                          COMPANY'S FINANCIAL COVENANTS

     So long as any Bank shall have any  Commitments  hereunder,  or any Loan or
other Obligation  shall remain unpaid or unsatisfied,  unless the Majority Banks
waive compliance in writing:

     9.1   Shareholders'   Equity.   The  Company   shall   maintain  a  minimum
Shareholders'  Equity  (excluding any preferred shares) of $165,000,000 plus 50%
of net  income  (if  greater  than  zero)  for each  quarter  ending on or after
September 30, 1997.

     9.2 EBITDA to Interest Ratio.  The Company shall maintain a ratio of EBITDA
to  Interest  Expense as at the end of any fiscal  quarter  for the four  fiscal
quarters then ending of not less than 4.0 to 1.0.

     9.3 Total Debt to Capital Ratio. The Company shall maintain a Total Debt to
Capital Ratio of not in excess of the following  percentages  at any time during
the following periods:

     Percentage        Periods

     60%                     Date hereof through August 14, 1998

     55%                     August 14, 1998 through August 15, 2000

     50%                     August 15, 2000 and thereafter


     9.4 Senior  Debt to EBITDA  Ratio.  The Company  shall  maintain a ratio of
Senior Debt to EBITDA Ratio of not in excess of the following amounts during the
following periods:

     Amount                  Period

     3.5 to 1                Date hereof through August 14,1999

     3.0 to 1                August 15, 1999 through August 14, 2000

     2.5 to 1                August 15, 2000 through August 14, 2001

     2.0 to 1                August 15, 2001 and thereafter





<PAGE>


                                    ARTICLE X

                                    GUARANTY

     10.1  Guaranty.   The  Guarantor  hereby  unconditionally  and  irrevocably
guarantees  the full and  punctual  payment  (whether at stated  maturity,  upon
acceleration  or  otherwise) of the principal of and interest on each Facility A
Note issued by the Company pursuant to this Agreement, and the full and punctual
payment of all other Obligations of the Company under this Agreement except with
respect to principal  and interest on the Facility B Loans.  Upon failure by the
Company to pay  punctually  any such amount,  the Guarantor  shall  forthwith on
demand pay the amount  not so paid at the place and in the manner  specified  in
this  Agreement.  In addition  (and without  limiting the  foregoing),  upon any
Facility A Loan being declared or otherwise becoming immediately due and payable
pursuant to Sections 11.2 or 12.2, the Guarantor  shall  forthwith on demand pay
all amounts  payable  under such  Facility A Loan at the place and in the manner
specified in this Agreement.

     10.2 Guaranty  Unconditional.  The  obligations of the Guarantor under this
Article  X shall  be  unconditional  and  absolute  and,  without  limiting  the
generality  of the  foregoing,  shall not be released,  discharged  or otherwise
affected by:

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

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

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

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

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

           (f) any  invalidity  or  unenforceability  relating to or against the
     Company for any reason of this  Agreement or any Note,  or any provision of
     applicable  law or  regulation  purporting  to prohibit  the payment by the
     Company of the  principal  of or interest  on any Note or any other  amount
     payable by the Company under this Agreement; or

           (g) any  other  act or  omission  to act or  delay of any kind by the
     Company,  the  Administrative  Agent, any Lender or any other Person or any
     other  circumstance  whatsoever which might, but for the provisions of this
     paragraph,  constitute a legal or equitable discharge of the Company or the
     Guarantor obligations as guarantor hereunder.

     10.3  Discharge  only  upon  Payment  in  Full;  Reinstatement  in  Certain
Circumstances.  The Guarantor's  obligations as guarantor hereunder shall remain
in full force and effect until the  Commitments  shall have  terminated  and all
Obligations  (except as to principal and interest with respect to the Facility B
Loans)  shall  have been paid in full in money.  If at any time any  payment  of
principal,  interest  or any other  amount  payable  by the  Company  under this
Agreement or any Note is  rescinded  or must be  otherwise  restored or returned
upon the insolvency,  bankruptcy or  reorganization of the Company or otherwise,
the  Guarantor's  obligations  hereunder  with respect to such payment  shall be
reinstated as though such payment had been due but not made at such time.

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

     10.5 Subrogation. Notwithstanding any payment made by or for the account of
the Guarantor  pursuant to this Article X, the Guarantor shall not be subrogated
to any  right of the  Administrative  Agent or any Bank  until  such time as the
Administrative  Agent and the Banks shall have received final payment in cash of
the full amount of all Obligations.

     10.6 Stay of  Acceleration.  If acceleration of the time for payment of any
amount  payable by the Company  under this  Agreement or any Note is stayed upon
the insolvency,  bankruptcy or reorganization  of the Company,  all such amounts
otherwise  subject  to  acceleration  under  the terms of this  Agreement  shall
nonetheless  be payable by the  Guarantor  hereunder  forthwith on demand by the
Administrative Agent made at the request of the Majority Banks.

                                   ARTICLE XI

                                EVENTS OF DEFAULT

     11.1 Event of Default.  Any of the following shall  constitute an "Event of
Default":

           (a)  Non-Payment.  The Company fails to pay, (i) when and as required
to be paid herein, any amount of principal of any Loan, or (ii) within five days
after the same  becomes  due,  any  interest,  fee or any other  amount  payable
hereunder or under any other Loan Document; or

           (b) Representation or Warranty. Any representation or warranty by the
Guarantor  or any  Subsidiary  made or deemed  made  herein,  in any other  Loan
Document,  or which is  contained in any  certificate,  document or financial or
other statement by the Guarantor, any Subsidiary,  or any Responsible Officer of
the Guarantor or any Subsidiary,  furnished at any time under this Agreement, or
in or under any other Loan Document,  is incorrect in any material respect on or
as of the date made or deemed made; or

           (c) Specific Defaults.  The Guarantor or the Company,  as applicable,
fails to perform or observe any term,  covenant or agreement contained in any of
Section 6.1, 6.2, 6.3 or 6.9 or in Article VII hereof; or

           (d) Other Defaults.  The Guarantor or the Company fails to perform or
observe any other term or covenant contained in this Agreement or any other Loan
Document (other than under Articles VIII and IX hereof),  and such default shall
continue  unremedied  for a period of 20 days after the date upon which  written
notice  thereof is given to the  Guarantor  by the  Administrative  Agent or any
Bank; or

           (e) Cross-Default.  The Guarantor or any Subsidiary (i) fails to make
any payment in respect of any  Indebtedness or Contingent  Obligation  having an
aggregate principal amount (including undrawn committed or available amounts and
including amounts owing to all creditors under any combined or syndicated credit
arrangement)  of  more  than  $10,000,000  with  respect  to the  Guarantor,  or
$5,000,000 with respect to the Company or any other Subsidiary of the Guarantor,
when due  (whether by scheduled  maturity,  required  prepayment,  acceleration,
demand,  or otherwise);  or (ii) fails to perform or observe any other condition
or  covenant,  or any other  event  shall occur or  condition  exist,  under any
agreement  or  instrument  relating  to  any  such  Indebtedness  or  Contingent
Obligation, if the effect of such failure, event or condition is to cause, or to
permit  the  holder  or  holders  of  such   Indebtedness   or   beneficiary  or
beneficiaries  of such  Indebtedness  (or a  trustee  or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause such Indebtedness to
be  declared  to be due  and  payable  prior  to its  stated  maturity,  or such
Contingent Obligation to become payable or cash collateral in respect thereof to
be demanded; or

           (f)  Insolvency;   Voluntary   Proceedings.   The  Guarantor  or  any
Subsidiary  (i) ceases or fails to be  solvent,  or  generally  fails to pay, or
admits in writing its inability to pay, its debts as they become due, subject to
applicable grace periods, if any, whether at stated maturity or otherwise;  (ii)
voluntarily  ceases to  conduct  its  business  in the  ordinary  course;  (iii)
commences any Insolvency  Proceeding with respect to itself or its property;  or
(iv) takes any action to effectuate or authorize any of the foregoing; or

           (g)  Involuntary   Proceedings.   (i)  Any   involuntary   Insolvency
Proceeding is commenced or filed against the Guarantor or any  Subsidiary or its
property,  or any writ,  judgment,  warrant of attachment,  execution or similar
process,  is issued or levied against a substantial  part of the  Guarantor's or
any  Subsidiary's  properties,  and any such proceeding or petition shall not be
dismissed, or such writ, judgment,  warrant of attachment,  execution or similar
process  shall not be  released,  vacated or fully  bonded  within 60 days after
commencement,  filing or levy;  (ii) the Guarantor or any Subsidiary  admits the
material allegations of a petition against it in any Insolvency  Proceeding,  or
an order for relief (or  similar  order  under  non-U.S.  law) is ordered in any
Insolvency  Proceeding;  or (iii) the Guarantor or any Subsidiary  acquiesces in
the  appointment of a receiver,  trustee,  custodian,  conservator,  liquidator,
mortgagee in possession (or agent therefor),  or other similar Person for itself
or a substantial portion of its property or business; or

           (h) ERISA.  (i) An ERISA Event shall occur with  respect to a Pension
Plan or Multi  employer Plan which has resulted or could  reasonably be expected
to result in liability of the  Guarantor  under Title IV of ERISA to the Pension
Plan,  Multi  employer Plan or the PBGC;  (ii) there exists an Unfunded  Pension
Liability;  or (iii) the Company or any ERISA  Affiliate  shall fail to pay when
due,  after the  expiration  of any  applicable  grace period,  any  installment
payment with respect to its  withdrawal  liability  under  Section 4201 of ERISA
under a Multi employer Plan; or

           (i)  Monetary  Judgments.  One or more  non-interlocutory  judgments,
non-interlocutory  orders,  decrees or arbitration awards is entered against the
Guarantor  or any  Subsidiary  involving  in the  aggregate a liability  (to the
extent not covered by independent  third-party insurance as to which the insurer
does not dispute  coverage) as to any single or related series of  transactions,
incidents  or  conditions,  of  $10,000,000  or more,  and the same shall remain
unsatisfied, unvacated and unstayed pending appeal for a period of 10 days after
the entry thereof; or

           (j)  Non-Monetary  Judgments.  Any  non-monetary  judgment,  order or
decree is entered  against the Guarantor or any  Subsidiary  which does or would
reasonably be expected to have a Material Adverse Effect, and there shall be any
period  of 10  consecutive  days  during  which  a stay of  enforcement  of such
judgment or order,  by reason of a pending appeal or otherwise,  shall not be in
effect; or

           (k)   Change of Control.  There occurs any Change of Control; or

           (l) Loss of Licenses.  Any other  Governmental  Authority  revokes or
fails to renew any material license, permit or franchise of the Guarantor or any
Subsidiary, or the Guarantor or any Subsidiary for any reason loses any material
license,  permit or franchise,  or the Guarantor or any  Subsidiary  suffers the
imposition of any restraining order,  escrow,  suspension or impound of funds in
connection with any proceeding  (judicial or administrative) with respect to any
material license, permit or franchise].

     11.2 Remedies.  If any Event of Default occurs,  the  Administrative  Agent
shall, at the request of, or may, with the consent of, the Majority Banks,

           (a)  declare  the  commitment  of  each  Bank  to  make  Loans  to be
terminated, whereupon such commitments shall be terminated;

           (b) declare the unpaid principal amount of all outstanding Loans, all
interest  accrued and unpaid  thereon,  and all other  amounts  owing or payable
hereunder or under any other Loan  Document to be  immediately  due and payable,
without presentment,  demand,  protest or other notice of any kind, all of which
are hereby expressly waived by the Company; and

           (c)  exercise  on  behalf of itself  and the  Banks  all  rights  and
remedies  available to it and the Banks under the Loan  Documents or  applicable
law;  provided,  however,  that upon the  occurrence  of any event  specified in
subsection  (f) or (g) of Section 11.1 (in the case of clause (i) of  subsection
(g) upon the expiration of the 60-day period mentioned therein),  the obligation
of  each  Bank  to make  Loans  shall  automatically  terminate  and the  unpaid
principal amount of all outstanding  Loans and all interest and other amounts as
aforesaid shall automatically  become due and payable without further act of the
Administrative Agent or any Bank.

     11.3 Rights Not  Exclusive.  The rights  provided for in this Agreement and
the other Loan  Documents  are  cumulative  and are not  exclusive  of any other
rights,  powers,  privileges or remedies  provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.

                                   ARTICLE XII

                           GUARANTOR EVENTS OF DEFAULT

     12.1 Event of  Default.  If the  Guarantor  fails to perform or observe any
term,  covenant or  agreement  contained  in any of Sections  8.1 through 8.7 it
shall constitute a "Guarantor Event of Default".

     12.2 Remedies. If any Guarantor Event of Default occurs, the Administrative
Agent shall, at the request of, or may, with the consent of, the Majority Banks,

           (a) declare the  commitment of each Bank to make Facility A Loans and
Facility B Conversions to be terminated,  whereupon  such  commitments  shall be
terminated;

           (b) declare the unpaid principal amount of all outstanding Facility A
Loans, all interest  accrued and unpaid thereon,  and all other amounts owing or
payable  hereunder or under any other Loan  Document to be  immediately  due and
payable,  without presentment,  demand, protest or other notice of any kind, all
of which are hereby expressly waived by the Company; and

           (c)  exercise  on  behalf of itself  and the  Banks  all  rights  and
remedies  available to it and the Banks under the Loan  Documents or  applicable
law.

                                  ARTICLE XIII

                            COMPANY EVENTS OF DEFAULT

     13.1 Event of Default. If the Company fails to perform or observe any term,
covenant  or  agreement  contained  in any of  Sections  9.1 through 9.4 and the
Company shall fail to deliver a Notice of Facility A Conversion co-signed by the
Guarantor  pursuant to Section  2.6 or shall fail to deliver a guarantee  of the
Guarantor of the obligations with respect to Facility B hereunder, together with
such certified resolutions,  incumbency  certificates and opinions of counsel as
the Administrative  Agent may require,  within 10 days after the date upon which
written  notice thereof is given to the Company by the  Administrative  Agent or
any Bank, it shall constitute a "Company Event of Default".

     13.2 Remedies.  If any Company Event of Default occurs,  the Administrative
Agent shall, at the request of, or may, with the consent of, the Majority Banks,

           (a)  declare  the   commitment  of  each  Bank  to  make  Facility  B
Conversions to be terminated, whereupon such commitments shall be terminated;

           (b) declare the unpaid principal amount of all outstanding Facility B
Loans, all interest  accrued and unpaid thereon,  and all other amounts owing or
payable  hereunder or under any other Loan Document (other than amounts owing or
payable solely with respect to  outstanding  Facility A Loans) to be immediately
due and payable,  without  presentment,  demand,  protest or other notice of any
kind, all of which are hereby expressly waived by the Company; and

           (c)  exercise  on  behalf of itself  and the  Banks  all  rights  and
remedies  available to it and the Banks under the Loan  Documents or  applicable
law.


                                   ARTICLE XIV

                            THE ADMINISTRATIVE AGENT

     14.1 Appointment.  Each Bank hereby irrevocably designates and appoints BNY
as the Administrative  Agent of such Bank under the Loan Documents and each Bank
hereby irrevocably  authorizes the  Administrative  Agent to take such action on
its behalf  under the  provisions  of the Loan  Documents  and to exercise  such
powers and perform such duties as are expressly  delegated to the Administrative
Agent by the  terms of the Loan  Documents,  together  with  such  powers as are
reasonably  incidental thereto.  The duties of the Administrative Agent shall be
mechanical and administrative in nature,  and,  notwithstanding any provision to
the contrary elsewhere in any Loan Document,  the Administrative Agent shall not
have any  duties  or  responsibilities  other  than  those  expressly  set forth
therein, or any fiduciary relationship with, or fiduciary duty to, any Bank, and
no  implied  covenants,  functions,  responsibilities,  duties,  obligations  or
liabilities shall be read into the Loan Documents or otherwise exist against the
Administrative Agent.

     14.2 Delegation of Duties. The Administrative  Agent may execute any of its
duties under the Loan  Documents by or through agents or  attorneys-in-fact  and
shall be entitled to rely upon,  and shall be fully  protected in, and shall not
be under any liability for,  relying upon, the advice of counsel  concerning all
matters pertaining to such duties.

     14.3 Exculpatory  Provisions.  Neither the Administrative  Agent nor any of
its officers,  directors,  employees,  agents,  attorneys-in-fact  or affiliates
shall be (i) liable for any action  lawfully  taken or omitted to be taken by it
or such  Person  under or in  connection  with the Loan  Documents  (except  the
Administrative  Agent for its own gross  negligence or willful  misconduct),  or
(ii) responsible in any manner to any of the Banks for any recitals, statements,
representations  or  warranties  made by the  Company  or the  Guarantor  or any
officer thereof  contained in the Loan Documents or in any certificate,  report,
statement or other  document  referred to or provided for in, or received by the
Administrative  Agent under or in connection with, the Loan Documents or for the
value,  validity,  effectiveness,  genuineness,  perfection,  enforceability  or
sufficiency  of any of the Loan  Documents  or for any failure of the Company or
the  Guarantor or any other Person to perform its  obligations  thereunder.  The
Administrative  Agent shall not be under any obligation to any Bank to ascertain
or to inquire  as to the  observance  or  performance  of any of the  agreements
contained in, or conditions of, the Loan Documents,  or to inspect the property,
books or records of the Company or the Guarantor. The Banks acknowledge that the
Administrative  Agent  shall  not be under  any  duty to take any  discretionary
action permitted under the Loan Documents unless the Administrative  Agent shall
be  instructed in writing to do so by the Majority  Banks and such  instructions
shall be binding on the Banks and all holders of the Notes;  provided,  however,
that the  Administrative  Agent shall not be  required to take any action  which
exposes the Administrative Agent to personal liability or its contrary to law or
any provision of the Loan Documents. The Administrative Agent shall not be under
any liability or  responsibility  whatsoever,  as  Administrative  Agent, to the
Company or the Guarantor or any other Person as a consequence  of any failure or
delay in performance, or any breach, by any Bank of any of its obligations under
any of the Loan Documents.

     14.4 Reliance by Administrative  Agent. The  Administrative  Agent shall be
entitled to rely,  and shall be fully  protected  in relying,  upon any writing,
resolution, notice, consent, certificate, affidavit, opinion, letter, cablegram,
telegram,  telecopy,  telex  or  teletype  message,  statement,  order  or other
document  or  conversation  believed by it to be genuine and correct and to have
been  signed,  sent or made by a proper  Person or Persons  and upon  advice and
statements  of legal  counsel  (including,  without  limitation,  counsel to the
Company or the Guarantor), independent accountants and other experts selected by
the Administrative  Agent. The Administrative  Agent may treat each Bank, or the
Person  designated in the last notice filed with it under this  Section,  as the
holder of all of the  interests  of such  Bank,  in its Loans and  Notes,  until
written notice of transfer, signed by such Bank (or the Person designated in the
last notice filed with the Administrative Agent) and by the Person designated in
such  written  notice of transfer,  in form and  substance  satisfactory  to the
Administrative  Agent, shall have been filed with the Administrative  Agent. The
Administrative  Agent  shall not be under any duty to  examine  or pass upon the
validity, effectiveness,  enforceability or genuineness of the Loan Documents or
any  instrument,  document or  communication  furnished  pursuant  thereto or in
connection  therewith,  and the Administrative Agent shall be entitled to assume
that the same are valid,  effective and genuine, have been signed or sent by the
proper parties and are what they purport to be. The  Administrative  Agent shall
be fully  justified  in failing or  refusing  to take any action  under the Loan
Documents  unless it shall  first  receive  such  advice or  concurrence  of the
Majority Banks as it deems appropriate.  The  Administrative  Agent shall in all
cases be fully protected in acting, or in refraining from acting, under the Loan
Documents in accordance with a request or direction of the Majority  Banks,  and
such  request  or  direction  and any action  taken or  failure to act  pursuant
thereto shall be binding upon all the Banks and all future holders of the Notes.

     14.5 Notice of  Default.  The  Administrative  Agent shall not be deemed to
have  knowledge or notice of the  occurrence  of any Default,  Event of Default,
Company Default, Company Event of Default,  Guarantor Default or Guarantor Event
of Default unless the  Administrative  Agent has received written notice thereof
from a Bank, the Company or the Guarantor.  In the event that the Administrative
Agent  receives  such a notice,  the  Administrative  Agent shall  promptly give
notice thereof to the Banks,  the Company or the Guarantor.  The  Administrative
Agent  shall take such action with  respect to such  Default,  Event of Default,
Company  Default,  Guarantor  Default or Guarantor  Event of Default as shall be
directed by the Majority  Banks,  provided,  however,  that unless and until the
Administrative  Agent shall have received such  directions,  the  Administrative
Agent may (but shall not be  obligated  to) take such  action,  or refrain  from
taking such action,  with  respect to such  Default,  Event of Default,  Company
Default,  Company  Event of Default,  Guarantor  Default or  Guarantor  Event of
Default as it shall deem to be in the best interests of the Banks.

     14.6  Non-Reliance  on  Administrative  Agent  and Other  Banks.  Each Bank
expressly  acknowledges  that  neither the  Administrative  Agent nor any of its
respective  officers,   directors,   employees,  agents,   attorneys-in-fact  or
affiliates has made any  representations  or warranties to it and that no act by
the Administrative Agent hereinafter, including any review of the affairs of the
Company or the Guarantor,  shall be deemed to constitute any  representation  or
warranty by the  Administrative  Agent to any Bank.  Each Bank represents to the
Administrative  Agent that it has,  independently  and without reliance upon the
Administrative Agent or any Bank, and based on such documents and information as
it has deemed  appropriate made its own evaluation of and investigation into the
business,   operations,    property,   financial   and   other   condition   and
creditworthiness of the Company the Guarantor and made its own decision to enter
into this Agreement.  Each Bank also represents that it will,  independently and
without  reliance upon the  Administrative  Agent or any Bank, and based on such
documents and information as it shall deem appropriate at the time,  continue to
make its own credit analysis,  evaluations and decisions in taking or not taking
action  under  any Loan  Document,  and to make such  investigation  as it deems
necessary to inform itself as to the business,  operations,  property, financial
and other condition and creditworthiness of the Company or the Guarantor. Except
for notices,  reports and other documents  expressly required to be furnished to
the Banks by the Administrative Agent hereunder,  the Administrative Agent shall
not have any duty or responsibility to provide the Bank with any credit or other
information concerning the business,  operations,  property, financial and other
condition or  creditworthiness of the Company or the Guarantor which at any time
may come into the possession of the Administrative Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.

     14.7  Indemnification.  Each Bank agrees to indemnify and hold harmless the
Administrative  Agent  in its  capacity  as such  (to the  extent  not  promptly
reimbursed by the Company or the Guarantor and without  limiting the  obligation
of the Company or the  Guarantor to do so), pro rata  according to the aggregate
of the outstanding  principal balance of the Loans (or at any time when no Loans
are outstanding,  according to its Pro Rata Share), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs,  expenses or  disbursements  of any kind  whatsoever  including,  without
limitation,  any amounts paid to the Banks (through the Administrative Agent) by
the Company or the Guarantor  pursuant to the terms of the Loan Documents,  that
are  subsequently  rescinded  or  avoided,  or must  otherwise  be  restored  or
returned)  which may at any time  (including,  without  limitation,  at any time
following  the payment of the Loans or the Notes) be imposed on,  incurred by or
asserted against the Administrative  Agent in any way relating to or arising out
of the Loan  Documents  or any other  documents  contemplated  by or referred to
therein or the transactions  contemplated thereby or any action taken or omitted
to be taken by the  Administrative  Agent under or in connection with any of the
foregoing;  provided,  however,  that no Bank shall be liable for the payment of
any  portion  of such  liabilities,  obligations,  losses,  damages,  penalties,
actions,  judgments,  suits,  costs,  expenses  or  disbursements  to the extent
resulting  solely  from the  finally  adjudicated  gross  negligence  or willful
misconduct of the  Administrative  Agent.  Without  limitation of the foregoing,
each Bank agrees to reimburse the Administrative  Agent promptly upon demand for
its pro rata share of any unpaid fees owing to the Administrative Agent, and any
costs and expenses (including, without limitation,  reasonable fees and expenses
of counsel)  payable by the Company or the Guarantor  under Section 15.4, to the
extent that the Administrative Agent has not been paid such fees or has not been
reimbursed  for such costs and expenses,  by the Company or the  Guarantor.  The
failure of any Bank to reimburse the  Administrative  Agent promptly upon demand
for its pro rata  share of any  amount  required  to be paid by the Banks to the
Administrative  Agent as  provided in this  Section  shall not relieve any other
Bank of its obligation  hereunder to reimburse the Administrative  Agent for its
pro rata share of such amount,  but no Bank shall be responsible for the failure
of other Bank to reimburse  the  Administrative  Agent for such other Bank's pro
rata share of such amount. If after having been indemnified or reimbursed by the
Banks as provided by this Section,  the Administrative Agent shall have received
payment from the obligor in respect of the  obligation or liability for which it
received   such   indemnification   or   reimbursement   from  the  Banks,   the
Administrative  Agent shall  disburse to the Banks an amount equal to the amount
of the payment so received on a pro rata basis.  The  agreements in this Section
shall survive the  termination of the  Commitments of all of the Banks,  and the
payment of all amounts payable under the Loan Documents.

     14.8  Administrative  Agent  in  Its  Individual  Capacity.   BNY  and  its
affiliates may make secured or unsecured loans to, accept  deposits from,  issue
letters of credit for the account of, act as trustee  under  indentures  of, and
generally  engage in any kind of business  with, the Company or the Guarantor as
though BNY were not an Agent  hereunder and BNY Capital  Markets did not arrange
the transactions  contemplated  hereby.  With respect to the Commitments made or
renewed by BNY and the Note  issued to BNY,  BNY shall have the same  rights and
powers under the Loan  Documents as any Bank and may exercise the same as though
it were not the Administrative  Agent, and the terms "Bank" and "Banks" shall in
each case include BNY.

     14.9  Successor  Agent.  If at any time the  Administrative  Agent deems it
advisable,  in its sole discretion,  it may submit to the Banks a written notice
of its  resignation as Agent under the Loan  Documents,  such  resignation to be
effective  upon the earlier of (i) the written  acceptance  of the duties of the
Administrative  Agent under the Loan Documents by a successor  Agent and (ii) on
the 30th day  after  the date of such  notice.  Upon any such  resignation,  the
Majority  Banks shall have the right to appoint from among the Banks a successor
Agent.  If no successor Agent shall have been so appointed by the Majority Banks
and  accepted  such  appointment  in writing  within 30 days after the  retiring
Administrative  Agent's  giving  of  notice of  resignation,  then the  retiring
Administrative   Agent  may,  on  behalf  of  the  Bank,   appoint  a  successor
Administrative Agent, which successor Administrative Agent shall be a commercial
bank  organized  under the laws of the United  States or any State  thereof  and
having  a  combined  capital,   surplus,  and  undivided  profits  of  at  least
$100,000,000.  Upon the acceptance of any  appointment as  Administrative  Agent
hereunder by a successor  Administrative  Agent,  such successor  Administrative
Agent shall thereupon succeed to and become vested with all the rights,  powers,
privileges  and duties of the retiring  Administrative  Agent,  and the retiring
Administrative Agent's rights,  powers,  privileges and duties as Administrative
Agent under the Loan Documents shall be terminated.  The Company,  the Guarantor
and the Banks shall execute such  documents as shall be necessary to effect such
appointment.   After  any  retiring   Administrative   Agent's   resignation  as
Administrative  Agent,  the provisions of the Loan Documents  shall inure to its
benefit as to any  actions  taken or omitted to be taken by it, and any  amounts
owing to it, while it was Administrative  Agent under the Loan Documents.  If at
any time there shall not be a duly  appointed and acting  Administrative  Agent,
the  Company  and the  Guarantor  agree to make each  payment due under the Loan
Documents directly to the Banks entitled thereto during such time.

     14.10 Syndication and Documentation  Agent. None of the Banks identified on
the facing page or  signature  pages of this  Agreement  as a  "syndication  and
documentation  agent"  shall  have  any  right,  power,  obligation,  liability,
responsibility  or duty under this Agreement other than those  applicable to all
Banks as such.  Without limiting the foregoing,  none of the Banks so identified
as a "co-agent" or "lead  manager" shall have or be deemed to have any fiduciary
relationship with any Bank. Each Bank  acknowledges that it has not relied,  and
will not rely,  on any of the Banks so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder.

                                   ARTICLE XV

                                  MISCELLANEOUS

     15.1  Amendments  and Waivers.  No amendment or waiver of any  provision of
this  Agreement or any other Loan  Document,  and no consent with respect to any
departure by the  Guarantor or any  applicable  Subsidiary  therefrom,  shall be
effective  unless the same shall be in writing and signed by the Majority  Banks
(or by the  Administrative  Agent at the written  request of the Majority Banks)
and the Company and acknowledged by the Administrative  Agent, and then any such
waiver or consent shall be effective  only in the specific  instance and for the
specific  purpose  for which  given;  provided,  however,  that no such  waiver,
amendment,  or consent shall, unless in writing and signed by all the Banks, the
Company and the Guarantor and acknowledged by the  Administrative  Agent, do any
of the following:

           (a) increase or extend the  Commitment  of any Bank (or reinstate any
Commitment terminated pursuant to Sections 11.2,12.2 or 13.2);

           (b)  postpone or delay any date fixed by this  Agreement or any other
Loan Document for any payment of principal,  interest, fees or other amounts due
to the Banks (or any of them) hereunder or under any other Loan Document;

           (c) reduce the principal of, or the rate of interest specified herein
on any Loan, or (subject to clause (ii) below) any fees or other amounts payable
hereunder or under any other Loan Document;

           (d) change the  percentage  of the Facility A  Commitments  or of the
aggregate  unpaid  principal amount of the Loans which is required for the Banks
or any of them to take any action hereunder; or

           (e) amend this Section,  or Section  2.16,  or any  provision  herein
providing for consent or other action by all Banks;

           (f) amend or terminate any guaranty  including the guaranty  pursuant
to Article X; and, provided further, that no amendment, waiver or consent shall,
unless in writing  and signed by the  Administrative  Agent in  addition  to the
Majority Banks or all the Banks, as the case may be, affect the rights or duties
of the Administrative Agent under this Agreement or any other Loan Document.

     15.2 Notices.  (a) All notices,  requests and other communications shall be
in writing  (including,  unless the context  expressly  otherwise  provides,  by
facsimile  transmission,  provided that any matter transmitted by the Company or
the  Guarantor by facsimile  (i) shall be  immediately  confirmed by a telephone
call to the recipient at the number  specified on Schedule  15.2, and (ii) shall
be followed  promptly by delivery of a hard copy  original  thereof) and mailed,
faxed or delivered,  to the address or facsimile number specified for notices on
Schedule  15.2;   or,  as  directed  to  the  Guarantor,   the  Company  or  the
Administrative Agent, to such other address as shall be designated by such party
in a written notice to the other parties, and as directed to any other party, at
such other address as shall be  designated by such party in a written  notice to
the Guarantor, the Company and the Administrative Agent.

           (b)  All  such  notices,  requests  and  communications  shall,  when
transmitted  by overnight  delivery,  or faxed,  be effective when delivered for
overnight  (next-day)  delivery,  or  transmitted  in legible  form by facsimile
machine,  respectively, or if mailed, upon the third Business Day after the date
deposited  into the U.S.  mail,  or if  delivered,  upon  delivery;  except that
notices  pursuant  to Article II or XIV shall not be  effective  until  actually
received by the Administrative Agent.

           (c) Any agreement of the Administrative Agent and the Banks herein to
receive  certain notices by telephone or facsimile is solely for the convenience
and at the request of the Company.  The Administrative Agent and the Banks shall
be entitled to rely on the  authority  of any Person  purporting  to be a Person
authorized by the Company to give such notice and the  Administrative  Agent and
the Banks shall not have any liability to the Company or other Person on account
of any  action  taken or not taken by the  Administrative  Agent or the Banks in
reliance upon such telephonic or facsimile notice. The obligation of the Company
to repay the  Loans  shall not be  affected  in any way or to any  extent by any
failure  by  the   Administrative   Agent  and  the  Banks  to  receive  written
confirmation  of any  telephonic  or  facsimile  notice  or the  receipt  by the
Administrative  Agent and the Banks of a confirmation  which is at variance with
the terms understood by the  Administrative  Agent and the Banks to be contained
in the telephonic or facsimile notice.

     15.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising,  on the part of the  Administrative  Agent or any Bank,  any  right,
remedy,  power or privilege  hereunder,  shall operate as a waiver thereof;  nor
shall any single or partial  exercise of any right,  remedy,  power or privilege
hereunder  preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege.

     15.4  Costs and  Expenses.  The  Guarantor  and the  Company,  jointly  and
severally shall:

           (a)  whether  or  not  the  transactions   contemplated   hereby  are
consummated,  pay or  reimburse  BofA within  five  Business  Days after  demand
(subject to subsection 4.1(a)(v)) for all costs and expenses incurred by BofA in
connection  with the  development,  preparation,  delivery,  administration  and
execution of, and any amendment,  supplement, waiver or modification to (in each
case,  whether or not  consummated),  this Agreement,  any Loan Document and any
other  documents  prepared  in  connection   herewith  or  therewith,   and  the
consummation  of the  transactions  contemplated  hereby and thereby,  including
reasonable Attorney Costs incurred by BofA with respect thereto; and

           (b) pay or reimburse  each Agent,  each Arranger and each Bank within
five Business Days after demand (subject to subsection  4.1(a)(v)) for all costs
and  expenses  (including   reasonable  Attorney  Costs)  incurred  by  them  in
connection with the enforcement,  attempted enforcement,  or preservation of any
rights or remedies  under this  Agreement or any other Loan Document  during the
existence of an Event of Default,  Guarantor Event of Default (or in the case of
the  Company,  a Company  Event of Default) or after  acceleration  of the Loans
(including  in  connection  with any  "workout" or  restructuring  regarding the
Loans, and including in any Insolvency Proceeding or appellate proceeding).

     15.5 Indemnity.  Whether or not the  transactions  contemplated  hereby are
consummated,  the  Guarantor  and the  Company,  jointly  and  severally,  shall
indemnify  and hold the  Agent-Related  Persons,  and each  Bank and each of its
respective officers, directors, employees, counsel, agents and attorneys-in-fact
(each,  an  "Indemnified   Person")  harmless  from  and  against  any  and  all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs,  charges,  expenses and disbursements  (including  Attorney Costs) of any
kind or nature whatsoever which may at any time (including at any time following
repayment of the Loans and the  termination,  resignation  or replacement of the
Agent or replacement of any Bank) be imposed on, incurred by or asserted against
any such Person in any way  relating to or arising out of this  Agreement or any
document contemplated by or referred to herein, or the transactions contemplated
hereby, or any action taken or omitted by any such Person under or in connection
with  any  of the  foregoing,  including  with  respect  to  any  investigation,
litigation  or  proceeding  (including  any  Insolvency  Proceeding or appellate
proceeding)  related to or arising out of this Agreement or the Loans or the use
of the  proceeds  thereof,  whether  or not any  Indemnified  Person  is a party
thereto  (all  the  foregoing,  collectively,  the  "Indemnified  Liabilities");
provided,  that the Guarantor and the Company shall have no obligation hereunder
to any  Indemnified  Person with respect to  Indemnified  Liabilities  resulting
solely  from the gross  negligence  or willful  misconduct  of such  Indemnified
Person;  and provided,  further,  that the  Indemnified  Persons  shall,  at the
Company's  request,  only use one counsel among them unless any such Indemnified
Person  determines in its sole discretion that its interests may differ from any
other Indemnified  Person.  The agreements in this Section shall survive payment
of all other Obligations.

     15.6  Payments Set Aside.  To the extent that the Company or the  Guarantor
makes a payment to the Administrative  Agent or the Banks, or the Administrative
Agent or the Banks  exercise  their  right of set-off,  and such  payment or the
proceeds  of such  set-off or any part  thereof  are  subsequently  invalidated,
declared to be  fraudulent  or  preferential,  set aside or required  (including
pursuant to any settlement entered into by the Administrative Agent or such Bank
in its  discretion) to be repaid to a trustee,  receiver or any other party,  in
connection with any Insolvency  Proceeding or otherwise,  then (a) to the extent
of such  recovery  the  obligation  or part  thereof  originally  intended to be
satisfied  shall be revived  and  continued  in full force and effect as if such
payment had not been made or such  set-off had not  occurred,  and (b) each Bank
severally  agrees to pay to the  Administrative  Agent upon  demand its pro rata
share of any amount so recovered from or repaid by the Administrative Agent.

     15.7  Successors and Assigns.  The  provisions of this  Agreement  shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns, except that the Guarantor and the Company may not assign
or transfer any of its rights or obligations  under this  Agreement  without the
prior written consent of the Administrative Agent and each Bank.

     15.8 Assignments,  Participations,  etc. (a) Any Bank may, with the written
consent of the Company at all times other than during the  existence of an Event
of  Default,  Guarantor  Event of Default or  Company  Event of Default  and the
Administrative Agent, which consents shall not be unreasonably  withheld, at any
time assign and delegate to one or more  Eligible  Assignees  (provided  that no
written consent of the Company or the Administrative  Agent shall be required in
connection with any assignment and delegation by a Bank to an Eligible  Assignee
that is an Affiliate of such Bank) (each an "Assignee") all, or any ratable part
of all, of the Loans,  the  Commitments  and the other rights and obligations of
such Bank  hereunder,  in a minimum  amount such that the Assignee  after giving
effect to such assignment shall hold at least $10,000,000 of the Commitments (or
if less the  aggregate  amount  of the  Commitments  of the Bank so  assigning);
provided, however, that the Company and the Administrative Agent may continue to
deal  solely and  directly  with such Bank in  connection  with the  interest so
assigned to an Assignee  until (i) written notice of such  assignment,  together
with payment instructions, addresses and related information with respect to the
Assignee,  shall have been given to the Company and the Administrative  Agent by
such Bank and the Assignee; (ii) such Bank and its Assignee shall have delivered
to the Company and the Administrative  Agent an Assignment and Acceptance in the
form of Exhibit E ("Assignment and Acceptance")  together with any Note or Notes
subject to such assignment,  (iii) the assignor Bank or Assignee has paid to the
Agent a processing fee in the amount of $3,000 and (iv) any assignment  shall be
pro rata between Facility A and Facility B.

           (b) From and after the date that the  Administrative  Agent  notifies
the assignor  Bank that it has received  (and  provided its consent with respect
to) an executed  Assignment and  Acceptance and payment of the  above-referenced
processing fee, (i) the Assignee  thereunder shall be a party hereto and, to the
extent that rights and  obligations  hereunder have been assigned to it pursuant
to such  Assignment and  Acceptance,  shall have the rights and obligations of a
Bank under the Loan  Documents,  and (ii) the assignor Bank shall, to the extent
that rights and  obligations  hereunder and under the other Loan  Documents have
been assigned by it pursuant to such Assignment and  Acceptance,  relinquish its
rights and be released from its obligations under the Loan Documents.

           (c) Within  five  Business  Days  after its  receipt of notice by the
Administrative  Agent that it has received an executed Assignment and Acceptance
and  payment of the  processing  fee,  (and  provided  that it  consents to such
assignment in accordance with subsection 15.8(a)), the Company shall execute and
deliver  to the  Administrative  Agent,  new Notes  evidencing  such  Assignee's
assigned Loans and  Commitment  and, if the assignor Bank has retained a portion
of its Loans and its Commitment,  replacement  Notes in the principal  amount of
the Loans  retained by the assignor  Bank (such Notes to be in exchange for, but
not in  payment  of,  the  Notes  held  by such  Bank).  Immediately  upon  each
Assignee's   making  its   processing  fee  payment  under  the  Assignment  and
Acceptance, this Agreement shall be deemed to be amended to the extent, but only
to the  extent,  necessary  to reflect  the  addition  of the  Assignee  and the
resulting  adjustment  of the  Commitments  arising  therefrom.  The  Commitment
allocated to each Assignee  shall reduce such  Commitments of the assigning Bank
pro tanto.

           (d) Any Bank may at any time sell to one or more commercial  banks or
other  Persons not  Affiliates  of the Company (a  "Participant")  participating
interests in any Loans,  the Commitment of that Bank and the other  interests of
that Bank (the "originating Bank") hereunder and under the other Loan Documents;
provided,  however,  that (i) the  originating  Bank's  obligations  under  this
Agreement shall remain unchanged,  (ii) the originating Bank shall remain solely
responsible for the performance of such  obligations,  (iii) the Company and the
Agent shall  continue to deal solely and directly with the  originating  Bank in
connection  with the  originating  Bank's  rights  and  obligations  under  this
Agreement and the other Loan Documents, and (iv) no Bank shall transfer or grant
any participating interest under which the Participant has rights to approve any
amendment  to, or any consent or waiver with  respect to, this  Agreement or any
other Loan  Document,  except to the extent  such  amendment,  consent or waiver
would require  unanimous  consent of the Banks as described in the first proviso
to Section 15.1. In the case of any such participation, the Participant shall be
entitled to the benefit of Sections  3.1,  3.3 and 15.5 as though it were also a
Bank  hereunder,  and not have any rights  under this  Agreement,  or any of the
other Loan Documents,  and all amounts payable by the Company hereunder shall be
determined  as if such Bank had not sold such  participation;  except  that,  if
amounts  outstanding under this Agreement are due and unpaid, or shall have been
declared or shall have become due and payable upon the occurrence of an Event of
Default,   Guarantor  Event  of  Default  or  Company  Event  of  Default,  each
Participant  shall be deemed  to have the right of  set-off  in  respect  of its
participating  interest in amounts owing under this Agreement to the same extent
as if the amount of its  participating  interest were owing  directly to it as a
Bank under this Agreement.

           (e) Notwithstanding  any other provision in this Agreement,  any Bank
may at any time create a security interest in, or pledge,  all or any portion of
its rights under and interest in this Agreement and the Note held by it in favor
of any Federal  Reserve Bank in accordance  with Regulation A of the FRB or U.S.
Treasury Regulation 31 CFR ss.203.14,  and such Federal Reserve Bank may enforce
such pledge or security interest in any manner permitted under applicable law.

     15.9 Confidentiality.  Each Bank agrees to take and to cause its Affiliates
to take normal and reasonable  precautions and exercise due care to maintain the
confidentiality  of all information  identified as "confidential" or "secret" by
the Company and  provided to it by the  Guarantor or any  Subsidiary,  or by the
Agents or the Arrangers on such Guarantor's or Subsidiary's  behalf,  under this
Agreement or any other Loan  Document,  and neither it nor any of its Affiliates
shall use any such  information  other than in connection with or in enforcement
of this  Agreement  and the other Loan  Documents  or in  connection  with other
business now or hereafter  existing or  contemplated  with the  Guarantor or any
Subsidiary;  except to the extent such information (i) was or becomes  generally
available to the public  other than as a result of  disclosure  by the Bank,  or
(ii) was or becomes  available on a  non-confidential  basis from a source other
than the  Guarantor or the Company,  provided that such source is not bound by a
confidentiality  agreement  with the Guarantor or the Company known to the Bank;
provided,  however,  that any  Bank may  disclose  such  information  (A) at the
request or pursuant to any  requirement of any  Governmental  Authority to which
the Bank is subject or in  connection  with an  examination  of such Bank by any
such  authority;  (B)  pursuant to subpoena  or other  court  process;  (C) when
required  to  do  so  in  accordance  with  the  provisions  of  any  applicable
Requirement of Law; (D) to the extent reasonably required in connection with any
litigation or proceeding to which the  Administrative  Agent,  any Bank or their
respective  Affiliates may be party;  (E) to the extent  reasonably  required in
connection  with the  exercise of any remedy  hereunder  or under any other Loan
Document;  (F) to  such  Bank's  independent  auditors  and  other  professional
advisors; (G) to any Participant or Assignee, actual or potential, provided that
such Person agrees in writing to keep such information  confidential to the same
extent required of the Banks hereunder;  (H) as to any Bank or its Affiliate, as
expressly permitted under the terms of any other document or agreement regarding
confidentiality  to which the Guarantor or any  Subsidiary is party or is deemed
party with such Bank or such Affiliate; and (I) to its Affiliates.

     15.10 Set-off. In addition to any rights and remedies of the Banks provided
by law, if an Event of Default exists or with respect to the Facility A Loans, a
Guarantor  Event of Default or with respect to the  Facility B Loans,  a Company
Event of Default, or the Loans have been accelerated, each Bank is authorized at
any time and from  time to time,  without  prior  notice to the  Company  or the
Guarantor,  any such notice being waived by the Company and the Guarantor 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 by,
and other  indebtedness  at any time owing by, such Bank to or for the credit or
the account of the  Company or the  Guarantor  against  any and all  Obligations
owing to such  Bank by the  Company  or the  Guarantor,  as  applicable,  now or
hereafter existing,  irrespective of whether or not the Administrative  Agent or
such Bank shall have made demand under this  Agreement or any Loan  Document and
although such  Obligations  may be  contingent  or  unmatured.  Each Bank agrees
promptly  to notify the  Company  and the  Administrative  Agent  after any such
set-off and application made by such Bank; provided,  however,  that the failure
to  give  such  notice  shall  not  affect  the  validity  of such  set-off  and
application.

     15.11 Automatic  Debits of Fees. With respect to any fee, or any other cost
or expense (including  Attorney Costs) due and payable to the Agents,  BNY, BofA
or any  Arranger  under  the Loan  Documents,  the  Company  hereby  irrevocably
authorizes BNY and BofA to debit any deposit  account of the Company with BNY or
BofA in an amount such that the aggregate  amount  debited from all such deposit
accounts  does not  exceed  such  fee or other  cost or  expense.  If there  are
insufficient  funds in such  deposit  accounts to cover the amount of the fee or
other cost or expense  then due,  such debits  will be reversed  (in whole or in
part, in BNY's or BofA's sole  discretion)  and such amount not debited shall be
deemed to be unpaid. No such debit under this Section shall be deemed a set-off.

     15.12  Notification  of Addresses,  Lending  Offices,  Etc. Each Bank shall
notify the  Administrative  Agent in writing  of any  changes in the  address to
which  notices to the Bank  should be  directed,  of  addresses  of any  Lending
Office,  of payment  instructions  in respect of all  payments  to be made to it
hereunder and of such other  administrative  information  as the  Administrative
Agent shall reasonably request.

     15.13  Counterparts.  This  Agreement  may be  executed  in any  number  of
separate  counterparts,  each of  which,  when so  executed,  shall be deemed an
original,  and all of said  counterparts  taken  together  shall  be  deemed  to
constitute but one and the same instrument.

     15.14 Severability.  The illegality or unenforceability of any provision of
this Agreement or any instrument or agreement  required  hereunder  shall not in
any way  affect  or impair  the  legality  or  enforceability  of the  remaining
provisions of this Agreement or any instrument or agreement required hereunder.

     15.15 No Third Parties  Benefited.  This Agreement is made and entered into
for the sole  protection  and legal benefit of the Guarantor,  the Company,  the
Banks, the Agents and the Agent-Related  Persons, and their permitted successors
and assigns, and no other Person shall be a direct or indirect legal beneficiary
of, or have any direct or indirect cause of action or claim in connection  with,
this Agreement or any of the other Loan Documents.

     15.16  Governing  Law and  Jurisdiction.  (a) THIS  AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE  WITH, THE LAW OF THE STATE OF
NEW YORK; PROVIDED THAT THE AGENTS AND THE BANKS SHALL RETAIN ALL RIGHTS ARISING
UNDER FEDERAL LAW.

           (b) ANY LEGAL ACTION OR PROCEEDING  WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR
OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT,  EACH OF THE GUARANTOR,  THE COMPANY, THE AGENTS AND
THE  BANKS  CONSENTS,  FOR  ITSELF  AND  IN  RESPECT  OF  ITS  PROPERTY,  TO THE
NON-EXCLUSIVE  JURISDICTION OF THOSE COURTS. EACH OF THE GUARANTOR, THE COMPANY,
THE  AGENTS  AND THE BANKS  IRREVOCABLY  WAIVES  ANY  OBJECTION,  INCLUDING  ANY
OBJECTION  TO THE  LAYING  OF  VENUE  OR  BASED  ON THE  GROUNDS  OF  FORUM  NON
CONVENIENS,  WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
PROCEEDING  IN SUCH  JURISDICTION  IN RESPECT OF THIS  AGREEMENT OR ANY DOCUMENT
RELATED HERETO. THE GUARANTOR,  THE COMPANY, THE AGENTS AND THE BANKS EACH WAIVE
PERSONAL SERVICE OF ANY SUMMONS,  COMPLAINT OR OTHER PROCESS,  WHICH MAY BE MADE
BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.

     15.17 Waiver of Jury Trial. THE GUARANTOR,  THE COMPANY,  THE BANKS AND THE
AGENTS  EACH WAIVE  THEIR  RESPECTIVE  RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS  AGREEMENT,  THE
OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY
ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES
AGAINST ANY OTHER PARTY OR ANY  AGENT-RELATED  PERSON,  PARTICIPANT OR ASSIGNEE,
WHETHER  WITH  RESPECT TO  CONTRACT  CLAIMS,  TORT  CLAIMS,  OR  OTHERWISE.  THE
GUARANTOR,  THE COMPANY,  THE BANKS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM
OR CAUSE OF  ACTION  SHALL BE TRIED BY A COURT  TRIAL  WITHOUT  A JURY.  WITHOUT
LIMITING THE FOREGOING, THE PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO
A TRIAL  BY JURY IS  WAIVED  BY  OPERATION  OF THIS  SECTION  AS TO ANY  ACTION,
COUNTERCLAIM OR OTHER  PROCEEDING WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE
THE VALIDITY OR  ENFORCEABILITY OF THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR
ANY  PROVISION  HEREOF OR  THEREOF.  THIS WAIVER  SHALL APPLY TO ANY  SUBSEQUENT
AMENDMENTS,  RENEWALS,  SUPPLEMENTS OR  MODIFICATIONS  TO THIS AGREEMENT AND THE
OTHER LOAN DOCUMENTS.

     15.18  Entire  Agreement.  This  Agreement,  together  with the other  Loan
Documents,  embodies the entire agreement and understanding among the Guarantor,
the  Company,   the  Banks  and  the  Agents,   and   supersedes  all  prior  or
contemporaneous  agreements  and  understandings  of  such  Persons,  verbal  or
written, relating to the subject matter hereof and thereof.

<PAGE>


118289690.9 April 3,1998 14:33C 97375844
                                     S-10
      IN WITNESS  WHEREOF,  the parties  herto have caused this  Agreement to be
duly executed and delivered by their proper and duly  authorized  officers as of
the day and year first above written.


                                 PHOENIX DUFF & PHELPS CORPORATION

                             By:____________________
                                      William R. Moyer

                                 Title:   ________________
                                          Senior Vice President and
                             Chief Financial Officer

<PAGE>


                                 PHOENIX HOME LIFE MUTUAL
                                INSURANCE COMPANY

                             By:____________________
                                      David W. Searfoss

                                 Title:   ________________
                                          Executive Vice President
                                 and Chief Financial Officer

<PAGE>


                                 BANK OF AMERICA NATIONAL TRUST
                                 AND SAVINGS ASSOCIATION, as
                              Syndication Agent and
                               Documentation Agent

                             By:____________________
                                      Elizabeth W.F. Bishop

                                 Title:   ________________
                                          Vice President



                                 BANK OF AMERICA NATIONAL TRUST
                                 AND SAVINGS ASSOCIATION, as a
                                 Bank

                             By:____________________
                                      Elizabeth W.F. Bishop

                                 Title:   ________________
                                          Vice President


<PAGE>


                                 THE BANK OF NEW YORK, as
                              Administrative Agent

                             By:____________________
                                     Melanie Shorofsky

                                 Title:   ________________
                                          Vice President



                                 THE BANK OF NEW YORK, as
                                 a Bank

                             By:____________________
                                     Melanie Shorofsky

                                 Title:   ________________
                                          Vice President


<PAGE>


                                 FLEET NATIONAL BANK, as a Bank
                             By:____________________
                                     Juliana B. Dalton

                                 Title:   ________________
                                          Vice President


<PAGE>


                                 BANK OF MONTREAL, as a Bank

                             By:____________________
                                 Charles W. Reed

                                 Title:   ________________
                                          Director



<PAGE>


                             SUNTRUST BANK, ATLANTA,
                                 as a Bank

                             By:____________________
                                     Craig W. Farnsworth

                                 Title:   ________________
                                          Vice President and
                                          Manager

                             By:____________________
                                     Maria C. Mamilovich

                                 Title:   ________________
                                          Vice President


<PAGE>


                                 STATE STREET BANK AND TRUST
                               COMPANY, as a Bank

                             By:____________________
                                     Edward M. Anderson

                                 Title:   ________________
                                          Vice President


<PAGE>


                                 DEUTSCHE BANK AG, NEW YORK AND/OR
                                 CAYMAN ISLANDS BRANCHES, as a Bank

                             By:____________________
                                     Louis Caltavuturo

                                 Title:   ________________
                                          Vice President


                             By:____________________
                                     Gayma Z. Shivnarain

                                 Title:   ________________
                                          Vice President


<PAGE>


                                 CREDIT LYONNAIS NEW YORK BRANCH
                                 as a Bank

                             By:____________________
                                 Sebastian Rocco

                                 Title:   ________________
                                          First Vice President





<PAGE>




                                  SCHEDULE 2.1

<TABLE>
<CAPTION>


                                   COMMITMENTS
                               AND PRO RATA SHARES


     <S>                            <C>               <C>              <C>
                                     Facility A        Facility B      Pro Rata
                Bank                 Commitments      Commitments        Share

     Bank of America National
     Trust and Savings
     Association                    $ 40,000,000      $ 20,000,000       20.0%

     The Bank of New York           $ 40,000,000      $ 20,000,000       20.0%

     Fleet National Bank            $ 35,000,000      $ 17,500,000       17.5%

     Bank of Montreal               $ 25,000,000      $ 12,500,000       12.5%

     State Street Bank              $ 20,000,000      $ 10,000,000       10.0%
        and Trust Company

     SunTrust Bank, Atlanta         $ 20,000,000      $ 10,000,000       10.0%

     Deutsche Bank AG,
     New York and/or                $ 10,000,000      $  5,000,000        5.0%
     Cayman Islands Branches

     Credit Lyonnais New York
     Branch                         $ 10,000,000      $  5,000,000        5.0%


                TOTAL               $200,000,000      $100,000,000      100.0%
</TABLE>


<PAGE>


                                  Schedule 5.5


                                   Litigation

                                      NONE

<PAGE>


                                  Schedule 5.7


                                      ERISA



                                      NONE

<PAGE>


                                  Schedule 5.11


                              Permitted Liabilities


               None,  other than as contained in the  footnotes to the financial
        statements referred to in Section 5.11(b).

<PAGE>


                                  Schedule 5.12


                              Environmental Matters



                                      NONE

<PAGE>


                                  Schedule 5.16


                       Subsidiaries and Minority Interests

      Subsidiaries of Guarantor


      Phoenix Home Life Mutual Insurance Company
            Phoenix Foundation (0%)
            PM Holdings, Inc. (100%)
                Aberdeen Asset Managers PLC (16%)
                American Phoenix Corporation (92%)
                     American Brokerage Corporation of Philadelphia (96.2%)
                     American Phoenix Corporation of Connecticut (71.5%)
                     American Phoenix Corporation of Maryland (100%)
                           Poor, Bowen, Bartlett & Kennedy of PA, Inc. (51%)
                     American Phoenix Corporation of Miami (85%)
                     American Phoenix Corporation of Orlando (80%)
                     American Phoenix Corporation of Western New York (94.5%)
                     American Phoenix Insurance Agency of Georgia, Inc. (100%)
                     American Phoenix Insurance Agency, Inc. (FL) (100%)
                     American Phoenix Insurance Agency, Inc. (NJ) (100%)
                           Giaconia Life Associates, Inc. (100%)
                     Caddell & Byers Insurance Agency, Inc. (80%)
                     Howard Hall Agency, Inc. (100%)
                      Kalvin-Miller Holdings Limited (100%)
                 American Phoenix Corporation of New York (100%)
                   Kalvin-Miller Life Consultants, Inc. (100%)
                                 Kalvin-Miller Consulting Group, Inc. (100%)
                      KAMSAC International, ltd. (100%)
                        Property Owners & Managers Purchasing Group, Inc. (100%)
                    Lees Preston Fairy (Holdings) Ltd. (63%)
                     McDowell Insurance, Inc. (87.4%)
                      Nicholas & Cannon Agency, Inc. (100%)
                     Premium Funding Associates Inc. (100%)
              American Phoenix Life and Reassurance Company (100%)
                     APLAR Services, Ltd. (100%)
                     Phoenix Life and Reassurance Company of New York (100%)
                Financial Administrative Services, Inc. (100%)
                HLI Management Corporation (100%)
                HLI Securities Processing Corporation (100%)
                Investors Advantage Corporation (100%)
                Investors Liquidity Financial, Inc. - dissolved 8/13/93 (100%)
                PHL Associates, Inc. (100%)
                     PHL Associates Insurance Agency of AL, Inc. (100%)
                     PHL Associates Insurance Agency of MA, Inc. (100%)

<PAGE>


                     PHL Associates Insurance Agency of MS, P.C.. (%)
                     PHL Associates Insurance Agency of NM, Inc. (100%)
                     PHL Associates Insurance Agency of OH, Inc. (%)
                     PHL Associates of Texas, Inc. (%)
                     PHL Global Holding Company (100%)
                     Command International Software (49%)
                     PHL Software Services, Ltd. (100%)
                PHL   Variable   Insurance   Company   (100%)   Phoenix-Aberdeen
                International  Advisors,  LLD (50%)  Phoenix  Charter  Oak Trust
                Company (100%) Phoenix Duff & Phelps  Corporation (60% of voting
                common stock)
                     CBO Investments Co. (100%)
                     DP Holdings Ltd. (100%)
                     DPCM Holdings, Inc. - Name Change 10/1/96 (100%)
                        Duff & Phelps Securities Co. - Sold 7/1/96 (100%)
                     Duff & Phelps Investment Management Co. (100%)
                     National Securities & Research Corporation (100%)
                     Phoenix Equity Planning Corporation (100%)
                     Phoenix Investment Counsel, Inc. (100%)
                        Windy City Investments Co. (100%)
                      Seneca Capital Managment LLC (74.9%)
                           IPWC CBO Corporation (100%)
                Phoenix Duff & Phelps Investment Advisors (100%)
                     DPIM, Inc. (100%)
                Phoenix Founders Inc. (100%)
                     238 Columbus Blvd., Inc. (100%)
                     Phoenix Realty Equity Investments, Inc. (100%)
                      Phoenix Realty Investors, Inc. (100%)
                       Phoenix Group Holdings, Inc. (100%)
                     Phoenix American Life Insurance Company (100%)
                     Phoenix Group Services, Inc. (100%)
                    Benefit Resource Management, Inc. (100%)
                     Phoenix Life and Annuity Company (100%)
                      Phoenix Life Insurance Company (100%)
                   Phoenix Real Estate Securities Inc. (100%)
                        Phoenix Realty Group, Inc. (100%)
                     Phoenix Realty Advisors, Inc. (100%)
                      Phoenix Corporate Services, LLC (55%)
                 Pinnacle Realty Management Company, Inc. (50%)
                     Phoenix Realty Securities, Inc. (100%)
                  Phoenix Strategic Capital Corporation (100%)
                      Phoenix Variable Advisors, Inc. (0%)
                   PML International Insurance Limited (100%)
          Townsend Financial Advisors, Inc. -- Dissolved 6/15/96 (100%)


<PAGE>


                Worldwide Phoenix Limited (100%)
                     American Phoenix Investments Limited (100%)
                     Worldwide Phoenix Offshore, Inc. (100%)
                        W.S. Griffith & Co., Inc. (100%)
                     W.S. Griffith Insurance Agency of AL, Inc. (100%)
                     W.S. Griffith Insurance Agency of MA, Inc. (100%)
                     W.S. Griffith Insurance Agency of MS, P.C. (0%)
                     W.S. Griffith Insurance Agency of NM, Inc. (100%)
                     W.S. Griffith Insurance Agency of OH, Inc. (100%)
                     W.S. Griffith Insurance Agency of TX, Inc. (0%)

      Subsidiaries and Equity Interests of Company


      Schedule 5.16(b)

      Subsidiaries:     Phoenix Equity Planning Corporation
                   Phoenix Investment Counsel, Inc.
                   National Securities and Research Corporation
                   Duff & Phelps Investment Management Co.
                   DPIM, Inc.
                    Phoenix Duff & Phelps Investment Advisors
                               DPCM Holdings, Inc.
                   DP Holdings Ltd.
                   CBO Investments Company
                   Windy City Investment Management Company
                   IPWC CBO Corporation
                   Seneca Capital Management LLC


      Equity Investments
                   Beutel Goodman & Co. Ltd.
                   The Greystone Group LLC
                   DP/Inverness  LLC; DPI Partners I; DPI Partners II FA Capital
                   LLC; FA Investors I, L.P.


<PAGE>


                                  Schedule 5.17


                                Insurance Matters


                                           NONE

<PAGE>


                                  Schedule 7.1


                                 Permitted Liens

                                      NONE

<PAGE>


                                  Schedule 7.4


                             Permitted Indebtedness


Loan from Phoenix Home Life Mutual Insurance  Company in the original  principal
amount of $30,103,337.50 due September 4, 1997.


Notesto three former members of GMG/Seneca  Capital Management LLC in the amount
     of $2,209,828,  $4,366,466,  and $2,920,648,  respectively,  due January 2,
     2000.

<PAGE>


                                  Schedule 7.7


                             Contingent Obligations


                                      NONE

<PAGE>




                                SCHEDULE 15.2


                   EURODOLLAR AND DOMESTIC LENDING OFFICES,

                            ADDRESSES FOR NOTICES

THE BANK OF NEW YORK, as
      Administrative Agent

The Bank of New York
One Wall Street
New York, New York 10286
Attention: Melanie Shorofsky

Telephone:(212) 635-6482
Facsimile:(212) 809-9520

With A Copy To:

William Fahey
The Bank of New York
One Wall Street
New York, New York 10286

Telephone:(212) 635-4690
Facsimile:(212) 635-6365


BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
  as Syndication and Documentation Agent

Bank of America National Trust
and Savings Association
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Lizet Flores

Telephone: (312) 828-6642
Facsimile: (312) 987-0889

THE BANK OF NEW YORK,
  as a Bank

Domestic and Eurodollar
 Lending Office:

One Wall Street
New York, New York 10286
Attention: Melanie Shorofsky


<PAGE>


Telephone: (212) 635-6482
Facsimile: (212) 809-9520

With A Copy To:

William Fahey
The Bank of New York
One Wall Street
New York, New York 10286
Telephone: (212) 635-4690
Facsimile: (212) 635-6365

Notices (other than Borrowing notices and Notices of Conversion/Continuation):

One Wall Street
New York, New York 10286
Attention: Melanie Shorofsky

Telephone: (212) 635-6482
Facsimile: (212) 809-9520

BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
   as a Bank

Domestic and Eurodollar Lending Office:
231 S. LaSalle Street
Chicago, Illinois 60697

Attention: Denise Stewart
Telephone: (312) 828-6552
Facsimile: (312) 974-9626

Notices (other than Borrowing notices and Notices of Conversion/Continuation):

231 S. LaSalle Street
Chicago, Illinois 60697

Attention: Elizabeth Bishop
Telephone: (312) 828-6550

FLEET NATIONAL BANK,
   as a Bank

Domestic and Eurodollar
   Lending Office:
777 Main Street
CT/MO/0250
Hartford, Connecticut 06115
Attention: Icy L. Mounds
              Insurance Industry Dept.

Telephone: (860) 986-4616
Facsimile: (860) 986-1094

Notices (other than Borrowing notices and Notices of Conversion/Continuation):

777 Main Street
CT/MO/0250
Hartford, Connecticut 06115
Attention: Julianna Dalton,
              Insurance Industry Dept.

Telephone: (860)986-3127
Facsimile: (860)986-1264

BANK OF MONTREAL,
   as a Bank

Domestic and Eurodollar
   Lending Office:

115 South LaSalle Street
12th Floor West
Chicago, Illinois 60603
Attention: Lora Benton

Telephone: )312) 750-3844
Facsimile: (312) 750-4345

Notices (other than Borrowing notices and Notices of Conversion/Continuation):

115 South LaSalle Street
12th Floor West
Chicago, Illinois 60603
Attention: Charles Reed, Corporate Banking

Telephone: (312) 750-5912
Facsimile: (312) 845-2199

SUNTRUST BANK, ATLANTA,
   as a Bank

Domestic and Eurodollar
   Lending Office
25 Park Place
Atlanta, Georgia 30303
Attention: Kathy Dorsey,
       U.S. Corporate Banking - Operations

Telephone: (404) 588-8375
Facsimile: (404) 658-4905

Notices (other than Borrowing notices and Notices of Conversion/Continuation):

711 5th Avenue
16th Floor
New York, New York 10022
Attention: Jamie McQueen - Banking Officer,
       U.S. Corporate Banking - Northeast Division

Telephone: (212) 583-2611
Facsimile: (212) 371-9386

STATE STREET BANK AND TRUST COMPANY,
   as a Bank

Domestic and Eurodollar
   Lending Office:

108 Myrtle Street
North Quincy, Massachusetts 02171
Attention: Toni Pace, Credit Services

Telephone: (617) 985-4685
Facsimile: (617) 537-2580

Notices (other than Borrowing notices and Notices of Conversion/Continuation):

108 Myrtle Street
North Quincy, Massachusetts 02171
Attention: Edward M. Anderson, Credit Services

Telephone: (617) 985-5301
Facsimile: (617) 537-2580

DEUTSCHE BANK AG,
   as a Bank

Domestic and Eurodollar
   Lending Office:

Deutsche Bank AG
31 West 52nd Street
New York, New York 10019
Attention: Cheryl Mandelbaum

Telephone: (212) 469-4092
Facsimile: (212) 469-4138

Notice (other than Borrowing notices and Notices of Conversion/Continuation):


Deutsche Bank AG
31 West 52nd Street

New York, New York 10019
Attention: Eckhard Osenberg, AVP

Telephone: (212) 469-8242
Facsimile: (212) 469-8366

CREDIT LYONNAIS NEW YORK BRANCH,
   as a Bank

Domestic and Eurodollar
   Lending Office:

Exchange Plaza
Floor 27
53 State Street
Boston, MA 02109
Attention: Lisa Leahy

Telephone: (617) 723-2615
Facsimile: (617) 723-4803

Notice (other than Borrowing notices and Notices of Conversion/Continuation):

Exchange Plaza
Floor 27
53 State Street
Boston, MA 02109
Attention: Lisa Turilli

Telephone: (617) 723-2615
Facsimile: (617) 723-4803




<PAGE>


                                  EXHIBIT A

                             NOTICE OF BORROWING


Date: _________________, _______

To:   The Bank of New York, as Administrative Agent for the Banks parties to the
      Credit Agreement dated as of _______________,  1997 (as extended, renewed,
      amended or  restated  from time to time,  the  "Credit  Agreement")  among
      Phoenix  Duff & Phelps  Corporation,  Phoenix  Home Life Mutual  Insurance
      Company,  certain  Banks which are  signatories  thereto,  Bank of America
      National Trust and Savings  Association,  as Syndication and Documentation
      Agent and The Bank of New York, as Administrative Agent

Ladies and Gentlemen:

      The undersigned, Phoenix Duff & Phelps Corporation (the "Company"), refers
to the Credit Agreement,  the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 2.3 of the
Credit Agreement, of the Borrowing of Facility A Loans specified below:

             1.   The   Business    Day   of   the    proposed    Borrowing   is
              __________________, 19___.

             2.    The aggregate amount of the proposed Borrowing is
              $-----------------.

             3. The Borrowing is to be comprised of  $___________ of [Base Rate]
              [CD Rate] [Eurodollar Rate] Loans.

             4. The  duration  of the  Interest  Period for the [CD Rate  Loans]
                [Eurodollar  Rate  Loans]  included  in the  Borrowing  shall be
                [_____ days] [_____ months].

      The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the proposed Borrowing,  before
and  after  giving  effect  thereto  and to  the  application  of  the  proceeds
therefrom:

            (a) the  representations  and warranties of the Company contained in
      Article V of the Credit  Agreement  are true and correct as though made on
      and as of  such  date  (except  to the  extent  such  representations  and
      warranties  relate to an  earlier  date,  in which  case they are true and
      correct as of such date);

            (b) no Default,  Event of Default,  Guarantor  Default or  Guarantor
      Event of Default has occurred and is continuing, or would result from such
      proposed Borrowing; and

            (c)The proposed  Borrowing  will not cause the  aggregate  principal
               amount of all outstanding Facility A Loans to exceed the combined
               Facility A Commitments of the Banks.

            (d)    The PCC Acquisition has occurred.]


                                                 PHOENIX DUFF & PHELPS
                                                       CORPORATION



                                                 By: ____________________

                                                 Title:__________________

<PAGE>


                                  EXHIBIT B

                      NOTICE OF CONVERSION/CONTINUATION



                                           Date: _______________, _____

To:   The Bank of New York, as Administrative Agent for the Banks parties to the
      Credit Agreement dated as of  _____________,  1997 (as extended,  renewed,
      amended or  restated  from time to time,  the  "Credit  Agreement")  among
      Phoenix  Duff & Phelps  Corporation,  Phoenix  Home Life Mutual  Insurance
      Company,  certain  Banks which are  signatories  thereto,  Bank of America
      National Trust and Savings  Association,  as Syndication and Documentation
      Agent and The Bank of New York, as Administrative Agent

Ladies and Gentlemen:

      The undersigned, Phoenix Duff & Phelps Corporation (the "Company"), refers
to the Credit Agreement,  the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 2.6 of the
Credit  Agreement,  of the  [conversion]  [continuation]  of the Loans specified
herein, that:

             1.    The Conversion/Continuation Date is __________, 19__.

             2.    The Loans to be [converted]  [continued]  are Facility [A][B]
                   Loans.

             3.    The  aggregate   amount  of  the  Loans  to  be   [converted]
                   [continued] is $_______________.

             4.    The Loans are to be [converted into] [continued as] [CD Rate]
                   [Eurodollar Rate] [Base Rate] Loans.

             5.    [If  applicable:] The duration of the Interest Period for the
                   Loans included in the  [conversion]  [continuation]  shall be
                   [_____ days] [_____ months].


                                           PHOENIX DUFF & PHELPS
                                                CORPORATION


                                           By:_________________________

                                           Title:______________________

<PAGE>


      EXHIBIT C


                        PHOENIX DUFF & PHELPS CORPORATION
                             COMPLIANCE CERTIFICATE


                                  Financial
                                     Statement Date: __________, 199__

       Reference   is  made  to  that   certain   Credit   Agreement   dated  as
of______________,  1997 (as extended,  renewed, amended or restated from time to
time,  the "Credit  Agreement")  among  Phoenix Duff & Phelps  Corporation  (the
"Company"),  Phoenix Home Life Mutual Insurance  Company,  the several financial
institutions  from time to time parties to this Credit  Agreement (the "Banks"),
Bank of America  National  Trust and Savings  Association,  as  Syndication  and
Documentation  Agent and The Bank of New York, as Administrative  Agent.  Unless
otherwise  defined  herein,  capitalized  terms used herein have the  respective
meanings assigned to them in the Credit Agreement.

       The undersigned  Responsible Officer of the Company,  hereby certifies as
of the date hereof that he/she is  the_______________  of the Company, and that,
as such,  he/she is  authorized to execute and deliver this  Certificate  to the
Banks  and  the  Administrative  Agent  on the  behalf  of the  Company  and its
consolidated Subsidiaries, and that:

       1. Enclosed herewith is a copy of the [annual  audit/quarterly] report of
the Company as at _______ (the "Computation  Date") which report fairly presents
the  financial  condition  and  results  of  operation  of the  Company  and its
Subsidiaries, as of the Computation Date.

              2. The  undersigned has reviewed and is familiar with the terms of
the  Credit  Agreement  and has made,  or has  caused to be made  under  his/her
supervision,  a detailed review of the transactions and conditions (financial or
otherwise) of the Company during the  accounting  period covered by the attached
financial statements.

       3. To the best of the undersigned's  knowledge,  the Company, during such
period,  has  observed,  performed or satisfied  all of its  covenants and other
agreements,  and  satisfied  every  condition  in  the  Credit  Agreement  to be
observed,  performed or satisfied by the  Company,  and the  undersigned  has no
knowledge of any Default,  Event of Default,  Company Default,  Company Event of
Default, Guarantor Default or Guarantor Event of Default.



<PAGE>


              4. The following  financial  covenant analyses and information set
forth on Schedule 1 attached  hereto are true and accurate on and as of the date
of this Certificate.

             IN WITNESS  WHEREOF,  the undersigned has executed this Certificate
as of _______________, 199__.


                                       PHOENIX DUFF & PHELPS CORPORATION



                                       By: _____________________________

                                       Title: __________________________



<PAGE>

<TABLE>
<CAPTION>

                                  Schedule 1

<S><C> <C>                                                   <C>        
1. Guarantor's Financial Covenants
   A.  Section 8.1 -- Total SAP Adjusted Capital
   1.  Unrestricted Surplus Accounts                         $
   2.  Asset Valuation Reserve                               $
   3.  Surplus Notes                                         $
   4.  SAP Capital (Sum of Items 1, 2 and                    $
          3)
   5.  Reserves for Losses On Real Estate                    $
   6.  Total SAP Adjusted Capital
       (Sum of Items 4 and 6)                                $
   7.  $825,000,000                                          $825,000,000
   8.  Net Income for last quarter                           $
   9.  50% of Item 8                                         $
   10. Sum of Item 9 for last
       Compliance Certificate plus
       Item 10 of last Compliance
       Certificate                                           $
   11. Required Minimum (Sum of
       Items 7, 9, and 10)                                   $

   B.  Section 8.2 -- Invested Assets -- NAIC
       Ratings 3 through 6
       1.  Net Invested Assets                               $

       2.  Maximum amount of notes,  bonds and other
           obligations  classified as bonds which bear
           NAIC Ratings from three to six, both inclusive
           (5.5% of Item 1)                                  $

       3.  Amount of such assets so rated                    $

   C.  Section 8.3 -- Invested Assets -- NAIC
       Ratings 5 through 6
       1.  Total SAP Adjusted Capital
           (Item A6 above)                                   $



<PAGE>


       2.  Maximum amounts of notes, bonds, and other
           obligations  classified as bonds which bear
           NAIC Ratings from five to six both inclusive
           (13% of Item 1)                                   $
       3.  Amount of such assets so rated                    $

   D.  Real Estate

       1.  Real estate and real estate  acquired in satisfaction of indebtedness
           (exclusive  of  either  category  occupied  by the  Guarantor  or its
           Primary Insurance Subsidiaries for
           use in their business)                            $
       2.  Mortgage Loans                                    $
       3.  Sum of Items 1 and 2                              $
       4.  Permitted Real Estate
           (32% of Item B1 above)                            $

   E.  Section 8.5-- Risk-Based Capital Ratio
       1.  Adjusted Capital                                  $
       2.  Authorized Control Level Risk-Based
           Capital                                           $
       3.  Company Action Level (200% of Item 2)             $
       4.  Risk Based Capital Ratio
           (Item 1 to Item 3)                                __ to 1.0
       5.  Required Minimum                                  1.75 to 1.0

   F.  Section 8.6 -- Non-Performing Real Estate
       1.  Investment in non-performing real
           estate (prior to reserves or write-
           offs)                                             $
       2.  Permitted investment
           (30% of Item A6)                                  $

   G.      Section 8.7-- Indebtedness to Capital
       1.  Indebtedness                                      $
       2.  Maximum permitted Indebtedness
           (75% of Item A6)                                  $



<PAGE>


2. Company's Financial Covenants

    A. Section 9.1 -- Shareholders' Equity
       1. Shareholders' equity                               $
       2. Preferred stock                                    $
       3. Item 1 minus Item 2                                $
       4. $165,000,000                                       $165,000,000
       5. Net income for last quarter                        $
       6. 50% of Item 5                                      $
       7. Sum of Item 6 of last
          Compliance Certificate plus
          Item 7 of last Compliance
          Certificate                                        $
       8. Required Minimum
          (Sum of Items 4, 6 and 7)                          $

   B.  Section 9.2-- EBITDA to Interest Ratio
       1. Earnings                                           $
       2. Interest                                           $
       3. Taxes                                              $
       4. Depreciation                                       $
       5. Amortization                                       $
       6. EBITDA (Sum of Items 1, 2, 3,
       4 and 5)                                              $
       7. Interest Expense                                   $
       8. Ratio (Item 6 to Item 7)                           ___ to 1.0
       a. Required Ratio                                     4.0 to 1.0

   C.  Section 9.3-- Total Debt to Capital Ratio
       1. Indebtedness                                       $
       2. 50% of Subordinated Debt which has
          been converted from preferred stock
          outstanding on the Closing Date                    $
       3. Item 1 less the lesser of Item 2 or
          $40,000,000                                        $
       4. Item 1 minus Item 3                                $
       5. Shareholders' equity                               $
       6. Ratio of Item 4 to Item 5                          _____%
       7. Maximum permitted ratio                            _____%

   D.  Section 9.4-- Senior Debt to EBITDA Ratio
       1. Indebtedness                                       $
       2. Subordinated Debt                                  $
       3. Senior Debt (Item 1 minus Item)                    $
       4. EBITDA (Item B6)                                   $
       5. Ratio (Item 3 to Item 4)                           ____ to 1.0
       6. Maximum permitted ratio                            ____ to 1.0

</TABLE>


<PAGE>


                               EXHIBIT D-1

                  FORM OF OPINION OF BORROWER'S COUNSEL

                           _____________, 1997

To:   Bank of America National Trust and Savings Association, as Syndication and
      Documentation Agent, The Bank of New York, as Administrative Agent and the
      other Banks parties from time to time to the Credit Agreement  hereinafter
      referred to

      Re:   Credit  Agreement dated as of __________,  1997 among Phoenix Duff &
            Phelps Corporation (the Company"),Phoenix Home Life Mutual Insurance
            (the  Guarantor"),  Bank  of  America  National  Trust  and  Savings
            Association, as Syndication and Documentation Agent, The Bank of New
            York,  as   Administrative   Agent  and  certain   other   financial
            institutions

Ladies and Gentlemen:

    The  undersigned has acted as counsel for the Company in connection with the
negotiation,  execution and delivery of the Credit  Agreement and the other Loan
Documents.  This opinion letter is delivered  pursuant to Section  4.1(a)(iv) of
the Credit  Agreement.  Unless otherwise defined herein or the context otherwise
requires,  all  capitalized  terms used in this  opinion  letter  shall have the
respective meanings assigned to them in the Credit Agreement.

                              [Assumptions]

    Based upon and subject to the foregoing, I am of the opinion that

          1. The Company is a corporation  duly organized,  validly existing and
 in good standing under the laws of the jurisdiction of its  incorporation,  and
 has full corporate power and authority to own and hold under lease its property
 and to conduct its business  substantially  as  currently  conducted by it. The
 Company has full corporate power and authority to obtain the Loans and to enter
 into and perform its obligations under each Loan Document.

          2. The  Company's  execution,  delivery  and  performance  of the Loan
 Documents are within the Company's  corporate powers, have been duly authorized
 by all necessary corporate action, and do not:
          A.       contravene the Company's Certificate of Incorporation
or Bylaws;

             B. contravene any Requirement of Law which is applicable to
transactions of the type provided for in the Loan Documents (a "Relevant
Law");

          C. to the best of my knowledge, contravene any order,
injunction, writ or decree of any court or any other Governmental
Authority (a "Relevant Order");

          D. conflict with or result in any breach or contravention of,
or the creation of any Lien under, any document evidencing any
Contractual Obligation to which the Company is a party; or

          E. result in, or require the creation or imposition of, any
Lien on the Company's property under any Relevant Law or Relevant Order.

             3. No  authorization  or approval or other action by, and no notice
to or filing with, any Governmental  Authority is required for the Company's due
execution,  delivery  or  performance  of the Loan  Documents,  to which it is a
party.

             4. The Loan  Documents  constitute  the  legal,  valid and  binding
obligations of the Company,  enforceable  against the Company in accordance with
their respective terms except that the enforceability  thereof may be limited by
(a)  applicable  bankruptcy,  insolvency,  fraudulent  conveyance,  liquidation,
rehabilitation, conservation, supervision, reorganization, moratorium or similar
laws affecting the rights and remedies of creditors generally, and (b) equitable
principles of general applicability, regardless of whether enforcement is sought
in a proceeding in equity or at law.

       I am  admitted  to practice  law in the State of  Connecticut.  Except as
noted, for purposes of this opinion,  and to the extent necessary I have assumed
that the law of the  State of New York is  identical  to the law of the State of
Connecticut. Nothing contained herein shall be deemed to be an opinion as to any
law other than the laws of the State of  Connecticut,  the State of Delaware and
any applicable federal laws of the United States of America, except as set forth
in the immediately following sentence.  Accordingly,  I express no opinion as to
the laws of any state or jurisdiction  other than the State of Connecticut,  the
State of New York (as qualified herein) and the United States of America.


<PAGE>


                             [Qualifications]

This opinion letter is rendered solely for the Agents' and the Banks' benefit in
connection with the above  transaction.  Without my prior written consent,  this
opinion  letter may not be: (i) relied  upon by any other party or for any other
purpose;  (ii) quoted in whole or in part or otherwise referred to in any report
or document;  or (iii)  furnished (the original or copies  thereof) to any party
except in connection with the enforcement of the Loan Documents by the Agents or
the  Banks;  provided,  however,  that  copies  of this  opinion  letter  may be
furnished to regulatory authorities, assignees and participants in the Loans and
pursuant to the requirements of process.


                                           Very truly yours,



<PAGE>


                                         EXHIBIT D-2

                     FORM OF OPINION OF GUARANTOR'S COUNSEL
                               _____________, 1997

To:   Bank of America National Trust and Savings Association, as Syndication and
      Documentation Agent, The Bank of New York, as Administrative Agent and the
      other Banks parties from time to time to the Credit Agreement  hereinafter
      referred to

      Re:    Credit Agreement dated as of __________,  1997 among Phoenix Duff &
             Phelps  Corporation  (the  "Company"),  Phoenix  Home  Life  Mutual
             Insurance  (the  Guarantor"),  Bank of America  National  Trust and
             Savings  Association,  as Syndication and Documentation  Agent, The
             Bank  of New  York,  as  Administrative  Agent  and  certain  other
             financial institutions

Ladies and Gentlemen:

      The  undersigned has acted as counsel for the Company and the Guarantor in
connection with the negotiation,  execution and delivery of the Credit Agreement
and the other Loan  Documents.  This  opinion  letter is  delivered  pursuant to
Section  4.1(a)(iv) of the Credit Agreement.  Unless otherwise defined herein or
the context  otherwise  requires,  all  capitalized  terms used in this  opinion
letter  shall  have  the  respective  meanings  assigned  to them in the  Credit
Agreement.

      I have  reviewed  the  corporate  proceedings  taken by the  Guarantor  in
connection with the Credit Agreement and the other Loan Documents.  In addition,
I have examined and relied upon copies of such Credit Agreement, the Charter and
the  Bylaws  of the  Guarantor  as in  effect  on the  date  hereof,  copies  of
supporting  resolutions  adopted by the Board of Directors  of the  Guarantor in
connection with the Credit Agreement and the transactions  contemplated  thereby
and certificates executed by officers of the Guarantor addressing facts material
to my  opinions  as I consider  necessary  or  appropriate  for the basis of the
opinions expressed.

      In making the examination of such agreements and instruments in connection
with the  opinions  expressed  herein,  I have  assumed the  genuineness  of all
signatures (other than those on behalf of the Guarantor) and the authenticity of
all documents submitted to me as originals and the conformity with the originals
of all documents submitted to me as copies and have further assumed that each


<PAGE>


of the Banks has the corporate  power to enter into and perform its  obligations
under the Credit  Agreement  and have  assumed  with respect to each of them due
authorization by all requisite  corporate action, due execution and delivery and
the valid and binding  effect of such documents and agreements and compliance by
the Banks with  applicable  law. I am admitted to practice law only in the State
of Connecticut and as to matters  involving New York law, I have relied upon the
review and  analysis of another  attorney  within the Legal  Division of Phoenix
Home Life Mutual Insurance  Company who is admitted to practice law in the State
of New York.

      Based upon and subject to the foregoing, I am of the opinion that

      1. The Guarantor is a corporation duly organized,  validly existing and in
good standing under the laws of the jurisdiction of its  incorporation,  and has
full corporate  power and authority to own and hold under lease its property and
to  conduct  its  business  substantially  as  currently  conducted  by it.  The
Guarantor has full  corporate  power and authority to enter into and perform its
obligations under each Loan Document to which it is a party.

      2.  The  Guarantor's  execution,  delivery  and  performance  of the  Loan
Documents to which it is a party are within the  Guarantor's  corporate  powers,
have been duly authorized by all necessary corporate action, and do not:

      A.     contravene the Guarantor's Charter or Bylaws;

      B.     to the best of our knowledge, contravene any relevant law;

      C.     contravene any relevant order;

      D.     conflict with or result in any breach or contravention of,
    or the creation of any Lien under, any document evidencing any
    Contractual Obligation to which the Guarantor is a party; or

      E.     result in, or require the creation or imposition of, any
    Lien on the Guarantor's property under any relevant law or relevant
    order.

             3. No  authorization  or approval or other action by, and no notice
    to  or  filing  with,  any  Governmental   Authority  is  required  for  the
    Guarantor's due execution,  delivery or performance of the Loan Documents to
    which it is a party.


<PAGE>


      4. The Loan  Documents to which the  Guarantor is a party  constitute  the
    legal, valid and binding  obligations of the Guarantor,  enforceable against
    the Guarantor in accordance with their terms.

      With  respect to  matters  of fact on which my  opinion  is based,  I have
relied on  appropriate  certificates  of public  officials  and  officers of the
Guarantor and I have no reason to believe such  certificates are inaccurate.  My
opinion is limited to the laws of the United  States of America and the State of
New York and Connecticut.

This opinion letter is rendered solely for the Agents' and the Banks' benefit in
connection with the above transaction.  Without our prior written consent,  this
opinion  letter may not be: (i) relied  upon by any other party or for any other
purpose;  (ii) quoted in whole or in part or otherwise referred to in any report
or document;  or (iii)  furnished (the original or copies  thereof) to any party
except in connection with the enforcement of the Loan Documents by the Agents or
the  Banks;  provided,  however,  that  copies  of this  opinion  letter  may be
furnished to regulatory authorities, assignees and participants in the Loans and
pursuant to the requirements of process.


                                           Very truly yours,



<PAGE>


                                EXHIBIT E

              [FORM OF] ASSIGNMENT AND ACCEPTANCE AGREEMENT


            This  ASSIGNMENT  AND ACCEPTANCE  AGREEMENT  (this  "Assignment  and
Acceptance")    dated    as    of    __________,    ___    is    made    between
______________________________ (the "Assignor") and
__________________________ (the "Assignee").


                                 RECITALS


            WHEREAS,  the  Assignor is party to that  certain  Credit  Agreement
dated as of  _____________,  1997 (as amended,  amended and restated,  modified,
supplemented  or renewed,  the "Credit  Agreement")  among Phoenix Duff & Phelps
Corporation (the "Company"),  Phoenix Home Life Mutual  Insurance  Company,  the
several financial  institutions  from time to time party thereto  (including the
Assignor, the "Banks"),  Bank of America National Trust and Savings Association,
as  Syndication  and  Documentation   Agent,  and  The  Bank  of  New  York,  as
Administrative  Agent. Any terms defined in the Credit Agreement and not defined
in this  Assignment  and  Acceptance  are used  herein as  defined in the Credit
Agreement;

            WHEREAS,  as provided under the Credit  Agreement,  the Assignor has
committed  to making Loans (the  "Loans") to the Company in an aggregate  amount
not to exceed $__________ (its "Commitments");

            WHEREAS, the Assignor wishes to assign to the Assignee [part of the]
[all]  rights and  obligations  of the  Assignor  under the Credit  Agreement in
respect of its  Commitments,  [together with a corresponding  portion of each of
its  outstanding  Loans,]  in an  amount  equal to  $__________  (the  "Assigned
Amount") on the terms and  subject to the  conditions  set forth  herein and the
Assignee  wishes  to  accept  assignment  of  such  rights  and to  assume  such
obligations from the Assignor on such terms and subject to such conditions;

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

      1.     Assignment and Acceptance.

      (a) Subject to the terms and conditions of this Assignment and Acceptance,
(i) the Assignor hereby sells,  transfers and assigns to the Assignee,  and (ii)
the Assignee hereby purchases, assumes and undertakes from the Assignor, without
recourse  and without  representation  or  warranty  (except as provided in this
Assignment and Acceptance) __% (the  "Assignee's  Percentage  Share") of (A) the
Commitments  [and  the  Loans]  of the  Assignor  and  (B) all  related  rights,
benefits, obligations,  liabilities and indemnities of the Assignor under and in
connection with the Credit Agreement and the Loan Documents.

                  [If appropriate,  add paragraph specifying payment to Assignor
by Assignee of  outstanding  principal  of,  accrued  interest on, and fees with
respect to, Loans assigned.]

      (b) With effect on and after the  Effective  Date (as defined in Section 5
hereof),  the Assignee  shall be a party to the Credit  Agreement and succeed to
all of the rights and be obligated to perform all of the  obligations  of a Bank
under   the   Credit   Agreement,    including   the   requirements   concerning
confidentiality  and the  payment of  indemnification,  with  Commitments  in an
amount equal to the Assigned Amount. The Assignee agrees that it will perform in
accordance  with their  terms all of the  obligations  which by the terms of the
Credit  Agreement are required to be performed by it as a Bank. It is the intent
of the parties  hereto that the  Commitments  of the Assignor  shall,  as of the
Effective  Date,  be reduced by an amount equal to the  Assigned  Amount and the
Assignor shall relinquish its rights and be released from its obligations  under
the Credit  Agreement  to the extent such  obligations  have been assumed by the
Assignee;  provided, however, the Assignor shall not relinquish its rights under
Sections 15.4 and 15.5 of the Credit  Agreement to the extent such rights relate
to the time prior to the Effective Date.

      (c) After giving effect to the assignment and assumption set forth herein,
on the Effective Date the Assignee's Commitments will be $__________.

      (d) After giving effect to the assignment and assumption set forth herein,
on the Effective Date the Assignor's Commitments will be $__________.



<PAGE>


   2.  Payments.

      (a) As consideration for the sale, assignment and transfer contemplated in
Section 1 hereof,  the Assignee  shall pay to the Assignor on the Effective Date
in immediately available funds an amount equal to $__________,  representing the
Assignee's Pro Rata Share of the principal amount of all Loans.

             (b)  The  [Assignor]  [Assignee]  further  agrees  to  pay  to  the
Administrative Agent a processing fee in the amount specified in Section 15.8 of
the Credit Agreement.

   3.   Reallocation of Payments

      Any interest,  fees and other payments  accrued to the Effective Date with
respect to the  Commitments  and Loans shall be for the account of the Assignor.
Any interest,  fees and other  payments  accrued on and after the Effective Date
with  respect to the Assigned  Amount shall be for the account of the  Assignee.
Each of the Assignor and the Assignee  agrees that it will hold in trust for the
other party any  interest,  fees and other amounts which it may receive to which
the other party is entitled  pursuant to the  preceding  sentence and pay to the
other party any such amounts which it may receive promptly upon receipt.

   4.  Independent Credit Decision.

      The  Assignee (a)  acknowledges  that it has received a copy of the Credit
Agreement and the Schedules  and Exhibits  thereto,  together with copies of the
most  recent  financial  statements  referred  to in  Section  6.1 of the Credit
Agreement, and such other documents and information as it has deemed appropriate
to make its own  credit  and legal  analysis  and  decision  to enter  into this
Assignment  and  Acceptance;  and (b)  agrees  that it will,  independently  and
without reliance upon the Assignor,  either Agent or any other Bank and based on
such  documents  and  information  as it shall  deem  appropriate  at the  time,
continue  to make its own  credit  and legal  decisions  in taking or not taking
action under the Credit Agreement.

   5.  Effective Date; Notices.

      (a) As between the Assignor and the Assignee,  the effective date for this
Assignment and Acceptance  shall be __________,  199__ (the  "Effective  Date");
provided  that the  following  conditions  precedent  have been  satisfied on or
before the Effective Date:

             (i)  this Assignment and Acceptance shall be executed and
delivered by the Assignor and the Assignee;

             (ii)  the  consent  of the  Company  and the  Administrative  Agent
required for an effective  assignment of the Assigned  Amount by the Assignor to
the Assignee  under  Section 15.8 of the Credit  Agreement  shall have been duly
obtained and shall be in full force and effect as of the Effective Date;

             (iii) the Assignee shall pay to the Assignor all amounts due to the
Assignor under this Assignment and Acceptance; and

             (iv) the  processing  fee referred to in Section 2(b) hereof and in
Section 15.8 of the Credit Agreement shall have been paid to the  Administrative
Agent; and

             (v) the Assignor  shall have  assigned and the Assignee  shall have
assumed a percentage equal to the Assignee's  Percentage Share of the rights and
obligations  of the  Assignor  under the  Credit  Agreement  (if such  agreement
exists).

      (b) Promptly  following the execution of this  Assignment and  Acceptance,
the  Assignor  shall  deliver to the  Company and the  Administrative  Agent for
acknowledgment by the Administrative Agent, a Notice of Assignment substantially
in the form attached hereto as Schedule 1.

      [6.    Administrative Agent.  [INCLUDE ONLY IF ASSIGNOR IS
ADMINISTRATIVE AGENT]

             (a) The Assignee  hereby  appoints and  authorizes  the Assignor to
take such  action as  administrative  agent on its behalf and to  exercise  such
powers under the Credit Agreement as are delegated to the  Administrative  Agent
by the Banks pursuant to the terms of the Credit Agreement.

             (b) The Assignee shall assume no duties or obligations  held by the
Assignor in its capacity as Administrative Agent under the Credit Agreement.]

      7.     Withholding Tax.

      The Assignee (a) represents  and warrants to the Bank, the  Administrative
Agent and the  Company  that under  applicable  law and  treaties no tax will be
required to be withheld by the Bank with  respect to any  payments to be made to
the Assignee hereunder, (b) agrees to furnish (if it is organized under the laws
of any  jurisdiction  other than the United States or any State  thereof) to the
Administrative  Agent and the Company prior to the time that the  Administrative
Agent or Company is required to make any payment of principal,  interest or fees
hereunder,  duplicate executed originals of either U.S. Internal Revenue Service
Form 4224 or U.S.  Internal  Revenue  Service  Form 1001  (wherein  the Assignee
claims  entitlement to the benefits of a tax treaty that provides for a complete
exemption from U.S.  federal income  withholding tax on all payments  hereunder)
and  agrees  to  provide  new  Forms  4224 or 1001  upon the  expiration  of any
previously delivered form or comparable statements in accordance with applicable
U.S. law and regulations and amendments thereto,  duly executed and completed by
the  Assignee,  and (c)  agrees  to comply  with all  applicable  U.S.  laws and
regulations with regard to such withholding tax exemption.

              8.  Representations and Warranties.

             (a) The Assignor  represents  and warrants that (i) it is the legal
and  beneficial  owner of the interest  being  assigned by it hereunder and that
such interest is free and clear of any Lien or other adverse  claim;  (ii) it is
duly organized and existing and it has the full power and authority to take, and
has taken,  all action  necessary  to execute and deliver  this  Assignment  and
Acceptance  and any other  documents  required  or  permitted  to be executed or
delivered by it in connection with this Assignment and Acceptance and to fulfill
its obligations hereunder;  (iii) no notices to, or consents,  authorizations or
approvals of, any Person are required (other than any already given or obtained)
for  its  due  execution,  delivery  and  performance  of  this  Assignment  and
Acceptance, and apart from any agreements or undertakings or filings required by
the Credit  Agreement,  no further  action by, or notice to, or filing with, any
Person is required of it for such execution,  delivery or performance;  and (iv)
this  Assignment  and  Acceptance has been duly executed and delivered by it and
constitutes the legal, valid and binding obligation of the Assignor, enforceable
against  the  Assignor  in  accordance  with the terms  hereof,  subject,  as to
enforcement,  to bankruptcy,  insolvency,  moratorium,  reorganization and other
laws of general  application  relating to or affecting  creditors' rights and to
general equitable principles.

      The  Assignor  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 the execution,  legality,
validity,  enforceability,  genuineness,  sufficiency  or  value  of the  Credit
Agreement or any other instrument or document  furnished  pursuant thereto.  The
Assignor makes no  representation or warranty in connection with, and assumes no
responsibility with respect to, the solvency,  financial condition or statements
of the Company or the Guarantor, or the performance or observance by the Company
or the  Guarantor,  of  any  of its  respective  obligations  under  the  Credit
Agreement or any other instrument or document furnished in connection therewith.

             (c)  The  Assignee  represents  and  warrants  that  (i) it is duly
organized  and  existing and it has full power and  authority  to take,  and has
taken,  all  action  necessary  to  execute  and  deliver  this  Assignment  and
Acceptance  and any other  documents  required  or  permitted  to be executed or
delivered  by it in  connection  with this  Assignment  and  Acceptance,  and to
fulfill  its   obligations   hereunder;   (ii)  no  notices  to,  or   consents,
authorizations  or approvals of, any Person are required (other than any already
given or  obtained)  for its due  execution,  delivery and  performance  of this
Assignment  and  Acceptance;  and apart from any agreements or  undertakings  or
filings required by the Credit Agreement, no further action by, or notice to, or
filing  with,  any Person is  required  of it for such  execution,  delivery  or
performance;  (iii) this  Assignment  and  Acceptance has been duly executed and
delivered by it and constitutes the legal,  valid and binding  obligation of the
Assignee,  enforceable against the Assignee in accordance with the terms hereof,
subject,   as   to   enforcement,   to   bankruptcy,   insolvency,   moratorium,
reorganization  and other laws of general  application  relating to or affecting
creditors'  rights  and to  general  equitable  principles;  and  (iv)  it is an
Eligible Assignee.

      9.     Further Assurances.

      The  Assignor  and the  Assignee  each hereby agree to execute and deliver
such  other  instruments,  and take  such  other  action,  as  either  party may
reasonably  request in connection  with the  transactions  contemplated  by this
Assignment  and  Acceptance,  including  the  delivery  of any  notices or other
documents or instruments to the Company or the  Administrative  Agent, which may
be  required in  connection  with the  assignment  and  assumption  contemplated
hereby.


<PAGE>


      10.    Miscellaneous.

             (a) Any amendment or waiver of any provision of this Assignment and
Acceptance  shall be in writing and signed by the parties hereto.  No failure or
delay by either  party  hereto  in  exercising  any  right,  power or  privilege
hereunder  shall operate as a waiver thereof and any waiver of any breach of the
provisions of this Assignment and Acceptance  shall be without  prejudice to any
rights with respect to any other or further breach thereof.

             (b) All payments made  hereunder  shall be made without any set-off
or counterclaim.

             (c) The Assignor and the Assignee  shall each pay its own costs and
expenses incurred in connection with the negotiation, preparation, execution and
performance of this Assignment and Acceptance.

             (d) This Assignment and Acceptance may be executed in any number of
counterparts  and all of such  counterparts  taken  together  shall be deemed to
constitute one and the same instrument.

             (e)  THIS  ASSIGNMENT  AND  ACCEPTANCE  SHALL  BE  GOVERNED  BY AND
CONSTRUED IN ACCORDANCE  WITH THE LAW OF THE STATE OF NEW YORK. The Assignor and
the Assignee each irrevocably  submits to the non-exclusive  jurisdiction of any
State or Federal court  sitting in New York over any suit,  action or proceeding
arising out of or relating to this  Assignment and  Acceptance  and  irrevocably
agrees that all claims in respect of such action or proceeding  may be heard and
determined  in such  New  York  State  or  Federal  court.  Each  party  to this
Assignment and Acceptance  hereby  irrevocably  waives, to the fullest extent it
may effectively do so, the defense of an  inconvenient  forum to the maintenance
of such action or proceeding.

             (f)  THE  ASSIGNOR  AND  THE   ASSIGNEE   EACH  HEREBY   KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY  WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY  LITIGATION  BASED  HEREON,  OR ARISING OUT OF,  UNDER,  OR IN
CONNECTION  WITH THIS  ASSIGNMENT  AND  ACCEPTANCE,  THE CREDIT  AGREEMENT,  ANY
RELATED DOCUMENTS AND AGREEMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING, OR
STATEMENTS (WHETHER ORAL OR WRITTEN).

             [Other  provisions  to be added as may be  negotiated  between  the
Assignor and the Assignee,  provided that such  provisions are not  inconsistent
with the Credit Agreement.]

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


                                                      [ASSIGNOR]

                                          By:_______________________

                                          Title:____________________

                                          Address:



<PAGE>


                                                      [ASSIGNEE]


                                          By:_______________________


                                          Title:____________________


                                          Address:__________________

<PAGE>


                                SCHEDULE 1

                   NOTICE OF ASSIGNMENT AND ACCEPTANCE

                                                _______________, 19__

The Bank of New York, as
      Administrative Agent

Phoenix Duff & Phelps Corporation

Ladies and Gentlemen:

      We refer to the Credit Agreement dated as of _________,  1997 (as amended,
amended and restated,  modified,  supplemented  or renewed from time to time the
"Credit Agreement") among Phoenix Duff & Phelps  Corporation,  Phoenix Home Life
Mutual  Insurance  Company,  the Banks  referred  to  therein,  Bank of  America
National Trust and Savings Association,  as Syndication and Documentation Agent,
and The Bank of New York, as Administrative  Agent.  Terms defined in the Credit
Agreement are used herein as therein defined.

      1. We hereby  give you  notice  of,  and  request  your  consent  to,  the
assignment  by  __________________  (the  "Assignor")  to  _______________  (the
"Assignee") of _____% of the right, title and interest of the Assignor in and to
the Credit  Agreement  (including,  without  limitation,  the  right,  title and
interest  of the  Assignor in and to the  Commitments  of the  Assignor  and all
outstanding Loans made by the Assignor pursuant to the Assignment and Acceptance
Agreement attached hereto (the "Assignment and Acceptance").

      2.  The  Assignee   agrees  that,   upon  receiving  the  consent  of  the
Administrative  Agent and, if applicable,  the Company to such  assignment,  the
Assignee will be bound by the terms of the Credit  Agreement as fully and to the
same extent as if the Assignee were the Bank originally holding such interest in
the Credit Agreement.

      3. The following administrative details apply to the Assignee:

            (A)   Notice Address:

                               Assignee name: __________________________
                               Address:  _______________________________
                                         _______________________________
                                         _______________________________ 
                               Attention:  _____________________________
                               Telephone:  (___) _______________________
                               Telecopier: (___) _______________________

                         Payment Instructions:

                               Account No.:_____________________________
                                       At: _____________________________
                                           
                               Reference:_______________________________
                               Attention:_______________________________

             4. You are  entitled to rely upon the  representations,  warranties
and covenants of each of the Assignor and Assignee  contained in the  Assignment
and Acceptance.

      IN WITNESS WHEREOF,  the Assignor and the Assignee have caused this Notice
of Assignment and Acceptance to be executed by their  respective duly authorized
officials, officers or agents as of the date first above mentioned.

                                           Very truly yours,
                                           [NAME OF ASSIGNOR]

                                           By:______________________
                                           Title:___________________

                                           [NAME OF ASSIGNEE]

                                           By:______________________

                                           Title:___________________

      ACKNOWLEDGED AND ASSIGNMENT
      CONSENTED TO:


      PHOENIX DUFF & PHELPS CORPORATION

      By:  _____________________________

      Title:  __________________________


      THE BANK OF NEW YORK, as
            Administrative Agent

      By:  __________________________

      Its: _________________________

<PAGE>


                                    EXHIBIT F


                            [FORM OF] PROMISSORY NOTE


$_____________                                  _____________, 1997


            FOR  VALUE  RECEIVED,   the  undersigned,   Phoenix  Duff  &  Phelps
Corporation,   (the  "Company"),   hereby  promises  to  pay  to  the  order  of
___________________  (the  "Bank") the  principal  sum of  ____________  Dollars
($___________)  or, if less, the aggregate  unpaid principal amount of all Loans
made by the Bank to the Company  pursuant to the Credit  Agreement,  dated as of
______________,  1997 (such Credit  Agreement,  as it may be amended,  restated,
supplemented or otherwise  modified from time to time, being hereinafter  called
the "Credit Agreement"),  among the Company,  Phoenix Home Life Mutual Insurance
Company,  the Bank, the other banks parties  thereto,  Bank of America  National
Trust and Savings  Association,  as Syndication and Documentation Agent, and The
Bank of New York,  as  Administrative  Agent,  on the  dates and in the  amounts
provided in the Credit  Agreement.  The Company further promises to pay interest
on the unpaid  principal  amount of the Loans evidenced hereby from time to time
at the rates, on the dates, and otherwise as provided in the Credit Agreement.

            The Bank is  authorized  to endorse the amount and the date on which
each Loan is made, the maturity date therefor and each payment of principal with
respect  thereto on the schedules  annexed hereto and made a part hereof,  or on
continuations  thereof  which shall be attached  hereto and made a part  hereof;
provided,  that any  failure to endorse  such  information  on such  schedule or
continuation  thereof  shall not in any  manner  affect  any  obligation  of the
Company under the Credit Agreement and this Promissory Note (the "Note").

            This Note is one of the Notes referred to in, and is entitled to the
benefits of, the Credit Agreement,  which Credit Agreement,  among other things,
contains  provisions for  acceleration of the maturity hereof upon the happening
of certain stated events and also for prepayments on account of principal hereof
prior to the maturity hereof upon the terms and conditions therein specified.

<PAGE>


            Terms  defined in the Credit  Agreement  are used  herein with their
defined  meanings therein unless  otherwise  defined herein.  This Note shall be
governed by, and construed and  interpreted in accordance  with, the laws of the
State of New York  applicable  to contracts  made and to be  performed  entirely
within such State.

                        PHOENIX DUFF & PHELPS CORPORATION

                       By:_______________________________

                        Title: __________________________




<PAGE>

<TABLE>
<CAPTION>

                                                        Schedule A to Note


             BASE RATE LOANS AND REPAYMENT OF BASE RATE LOANS

     <S>    <C>            <C>         <C>            <C>    
     (1)    (2)            (3)         (4)            (5)
     Date   Facility of    Amount of   Amount of      Notation Made BY
            Base Rate      Base Rate   Base Rate
            Loan           Loan        Loan Repaid
                                       or Converted
</TABLE>




<PAGE>

<TABLE>
<CAPTION>

                                                        Schedule B to Note

       EURODOLLAR RATE LOANS AND REPAYMENT OF EURODOLLAR RATE LOANS


 <S>       <C>            <C>          <C>         <C>          <C>
 (1)       (2)            (3)          (4)         (5)          (6)
 Date      Facility of    Amount of    Interest    Amount of    Notation
           Eurodollar     Eurodollar   Period of   Eurodollar   Made By
           Rate Loan      Rate Loan    Eurodollar  Rate Loan
                                       Rate Loan   Repaid or
                                                   Converted



<PAGE>


                                                        Schedule C to Note

               CD RATE LOANS AND REPAYMENT OF CD RATE LOANS


 (1)       (2)            (3)          (4)         (5)          (6)
 Date      Facility of    Amount of    Interest    Amount of    Notation
           CD Rate        CD Rate      Period of   CD Rate      Made By
           Loan           Loan         CD Rate     Loan
                                                   Repaid or
                                                   Converted

</TABLE>




<PAGE>


            Phoenix Investment Partners, Ltd. and Subsidiaries

                                EXHIBIT G

                     NOTICE OF FACILITY A CONVERSION

                              Date: _____________________, _____

To:   The Bank of New York, as Administrative Agent for the Banks
      parties to the Credit Agreement dated as of _________, 1997 (as
      extended, renewed, amended or restated from time to time, the
      "Credit Agreement") among Phoenix Duff & Phelps Corporation,
      -----------------
      Phoenix Home Life Mutual Insurance Company, certain Banks which
      are signatories thereto, Bank of America National Trust and
      Savings Association, as Syndication and Documentation Agent, and
      The Bank of New York, as Administrative Agent

Ladies and Gentlemen:

     The  undersigned,  Phoenix Duff & Phelps  Corporation and Phoenix Home Life
Mutual  Insurance  Company  refer to the  Credit  Agreement,  the terms  defined
therein  being  used  herein as  therein  defined,  and  hereby  give you notice
irrevocably,  pursuant to Section 2.5 of the Credit Agreement, of the conversion
of the Facility B Loans specified herein into Facility A Loans, that:

     1.     The Facility Conversion Date is ___________, 19__.

     2.     The aggregate amount of the Loans to be converted is
        $______________.

     3. The Loans to be converted  are [CD Rate]  [Eurodollar  Rate] [Base Rate]
        Loans.

     4. [If  applicable:] The Interest Period for the Loans to be converted ends
        on _________________.

                      PHOENIX DUFF & PHELPS CORPORATION

                      By:_______________________________

                      Title:____________________________


                      PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY

                      By:_______________________________

                      Title:____________________________

<PAGE>


                                EXHIBIT H

                     NOTICE OF FACILITY B CONVERSION

                                  Date: _____________________, ____

To:   The Bank of New York, as Administrative Agent for the Banks
      parties to the Credit Agreement dated as of __________, 1997 (as
      extended, renewed, amended or restated from time to time, the
      "Credit Agreement") among Phoenix   Duff & Phelps Corporation,
      -----------------
      Phoenix Home Life Mutual Insurance Company, certain Banks which
      are signatories thereto, Bank of America National Trust and
      Savings Association, as Syndication and Documentation Agent, and
      The Bank of New York, as Administrative Agent

Ladies and Gentlemen:

     The undersigned,  Phoenix Duff & Phelps Corporation (the "Company"), refers
to the Credit Agreement,  the terms defined therein being used herein as therein
defined, and hereby gives you notice irrevocably, pursuant to Section 2.4 of the
Credit  Agreement,  of the conversion of the Facility A Loans  specified  herein
into Facility B Loans, that:

     1.     The Facility Conversion Date is _____________, 19__.

     2.     The aggregate amount of the Loans to be converted is
        $________________.

     3. The Loans to be converted  are [CD Rate]  [Eurodollar  Rate] [Base Rate]
        Loans.

     4. [If  applicable:] The Interest Period for the Loans to be converted ends
        on __________________.

     5. The undersigned hereby certifies that the following  statements are true
        on the date hereof, and will be true on the proposed Facility Conversion
        Date,  before and after giving effect thereto and to the  application of
        the proceeds therefrom:

      (a) the representations and warranties of the Company contained in Article
     V of the Credit  Agreement are true and correct as though made on and as of
     such date (except to the extent such  representations and warranties relate
     to an  earlier  date,  in which  case they are true and  correct as of such
     date);

      (b) no Default,  Event of  Default,  Company  Default or Company  Event of
     Default has occurred and is continuing,  or would result from such proposed
     conversion;

      (c) the proposed  conversion will not cause the aggregate principal amount
     of all  outstanding  Facility  B Loans to exceed  the  combined  Facility B
     Commitments of the Banks;

      (d) the Senior Debt to EBITDA Ratio of the Company and its Subsidiaries as
     of ____________ was ____________; and

      (e) the  Total  Debt to  Capital  Ratio,  giving  effect  to the  proposed
     Facility B Loans, is ________________.

                      PHOENIX DUFF & PHELPS CORPORATION

                      By:_______________________________

                      Title:____________________________