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                                CREDIT AGREEMENT


                                   dated as of


                                 January 7, 1997


                                      among


                           CONTIFINANCIAL CORPORATION


                            The Lenders Party Hereto


                                       and


                           CREDIT SUISSE FIRST BOSTON,
                                NEW YORK BRANCH,
                             as Administrative Agent

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

                           CREDIT SUISSE FIRST BOSTON,
                     NEW YORK BRANCH, AND DRESDNER BANK AG,
                       NEW YORK AND GRAND CAYMAN BRANCHES,
                                 as Co-Arrangers



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<PAGE>

                                TABLE OF CONTENTS

                                                                           Page

                                   ARTICLE I

                                  Definitions

SECTION 1.01.    Defined Terms                                               1
SECTION 1.02.    Classification of Loans and Borrowings                     30
SECTION 1.03.    Terms Generally                                            30
SECTION 1.04.    Accounting Terms; GAAP                                     31

                                   ARTICLE II

                                   The Credits

SECTION 2.01.    Commitments                                                32
SECTION 2.02.    Loans and Borrowings                                       32
SECTION 2.03.    Requests for Revolving Borrowings                          33
SECTION 2.04.    Swingline Loans                                            34
SECTION 2.05.    Funding of Borrowings                                      36
SECTION 2.06.             Interest Elections                                36
SECTION 2.07.    Termination and Reduction of Commitments
                                                                            38
SECTION 2.08.    Repayment of Loans; Evidence of Debt                       39
SECTION 2.09.    Prepayment of Loans                                        40
SECTION 2.10.    Fees                                                       41
SECTION 2.11.    Interest                                                   42
SECTION 2.12.    Alternate Rate of Interest                                 43
SECTION 2.13.    Increased Costs                                            43
SECTION 2.14.    Break Funding Payments                                     45
SECTION 2.15.    Taxes                                                      45
SECTION 2.16.    Payments Generally; Pro Rata Treatment; Sharing of 
                 Set-offs                                                   47
<PAGE>

SECTION 2.17.    Mitigation Obligations; Replacement of Lenders             49

                                   ARTICLE III

                               Representations and
                                   Warranties

SECTION 3.01.    Organization; Powers                                       50
SECTION 3.02.    Authorization; Enforceability                              50
SECTION 3.03.    Governmental Approvals; No Conflicts                       51
SECTION 3.04.    Financial Condition; No Material Adverse Change
                                                                            51
SECTION 3.05.    Properties                                                 51
SECTION 3.06.    Litigation and Environmental Matters                       52
SECTION 3.07.    Compliance with Laws and Agreements                        52
SECTION 3.08.    Investment and Holding Company Status                      53
SECTION 3.09.    Taxes                                                      53
SECTION 3.10.    ERISA                                                      53
SECTION 3.11.    Disclosure                                                 53
SECTION 3.12.    Federal Reserve Regulations                                54

                                   ARTICLE IV

                                   Conditions

SECTION 4.01.    Effective Date                                             54
SECTION 4.02.    Each Credit Event                                          56

                                    ARTICLE V

                              Affirmative Covenants

SECTION 5.01.    Financial Statements and Other Information                 57


<PAGE>

SECTION 5.02.    Notices of Material Events                                 59
SECTION 5.03.    Existence; Conduct of Business                             60
SECTION 5.04     Payment of Obligations                                     60
SECTION 5.05.    Maintenance of Properties; Insurance                       60
SECTION 5.06.    Books and Records; Inspection
                   and Audit Rights                                         60
SECTION 5.07.    Compliance with Laws                                       61
SECTION 5.08.    Use of Proceeds                                            61

                                   ARTICLE VI

                               Negative Covenants

SECTION 6.01.    Limitation on Indebtedness and Preferred
                   Stock of Restricted Subsidiaries                         62
SECTION 6.02.    Limitation on Liens                                        63
SECTION 6.03.    Limitation on Mergers and Consolidations
                                                                            66
SECTION 6.04.    Limitation on Sales of Assets and
                   Subsidiary Stock                                         67
SECTION 6.05.    Limitation on Loans and Investments                        68
SECTION 6.06.    Limitation on Affiliate
                   Transactions                                             71
SECTION 6.07.    Limitation on Restrictions on
                   Distributions from Restricted
                   Subsidiaries                                             72
SECTION 6.08.    Limitation on Investment Company Status                    73
SECTION 6.09.    Financial Covenants                                        73
SECTION 6.10.    Limitation on Business of the Borrower                     73


                                   ARTICLE VII

                                Events of Default                           74


                                  ARTICLE VIII

                           The Administrative Agent                         77

<PAGE>

                                   ARTICLE IX

                                  Miscellaneous

SECTION 9.01.    Notices                                                    80
SECTION 9.02.    Waivers; Amendments                                        80
SECTION 9.03.    Expenses; Indemnity; Damage Waiver                         82
SECTION 9.04.    Successors and Assigns                                     83
SECTION 9.05.    Survival                                                   87
SECTION 9.06.    Counterparts; Integration;
                   Effectiveness                                            87
SECTION 9.07.    Severability                                               87
SECTION 9.08.    Right of Setoff                                            88
SECTION 9.09.    Governing Law; Jurisdiction; Consent
                   to Service of Process                                    88
SECTION 9.10.    WAIVER OF JURY TRIAL                                       89
SECTION 9.11.    Headings                                                   89
SECTION 9.12.    Confidentiality                                            90


SCHEDULES:

Schedule 2.01 -- Commitments
Schedule 3.06 -- Disclosed Matters
Schedule 6.01 -- Indebtedness and Preferred Stock
Schedule 6.02 -- Existing Liens
Schedule 6.06 -- Affiliate Transactions
Schedule 6.07 -- Existing Restrictions

EXHIBITS:

Exhibit A -- Form of Assignment and Acceptance
Exhibit B -- Forms of Opinion of Borrower's Counsel
Exhibit C -- Borrowing Base Certificate

<PAGE>

                    CREDIT AGREEMENT dated as of January 7, 1997, among
               CONTIFINANCIAL CORPORATION, the LENDERS party hereto, and CREDIT
               SUISSE FIRST BOSTON, NEW YORK BRANCH, as Administrative Agent.

          The Borrower (such term and each other capitalized term used but not
otherwise defined herein having the meaning assigned to it in Article I) has
requested the Lenders to establish the credit facilities provided for herein for
liquidity and general corporate purposes. The Lenders are willing to establish
such credit facilities upon the terms and subject to the conditions set forth
herein. Accordingly, the parties hereto agree as follows:

                                    ARTICLE I

                                   Definitions

          SECTION 1.01. Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:

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

          "Additional Assets" means (i) any property or assets (other than
Indebtedness and Capital Stock) used or useful in a Related Business, (ii) the
Capital Stock of a Person that becomes a Restricted Subsidiary as a result of
the acquisition of such Capital Stock by the Borrower or another Restricted
Subsidiary, (iii) Capital Stock constituting a minority interest in any Person
that at such time is a Restricted Subsidiary; provided, however, that any such
Restricted Subsidiary described in clause (ii) or (iii) above is primarily
engaged in a Related Business or (iv) the Capital Stock or Indebtedness of a
Strategic Alliance Client.

          "Adjusted LIBO Rate" means, with respect to each day during each
Interest Period pertaining to a Eurodollar Borrowing, an interest rate per annum
determined in accordance with the following formula (rounded upwards, if
necessary, to the next 1/16 of 1%):

            LIBO Rate
          ----------------
          1.00 - Eurocurrency Reserve Requirements

          "Administrative Agent" means Credit Suisse First Boston, New York
Branch, in its capacity as administrative agent for the Lenders hereunder.

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

<PAGE>

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

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

          "Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment,
giving effect to any assignments made in conformity with Section 9.04(b). If the
Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments made in conformity with Section 9.04(b).

          "Applicable Rate" means, for any day, with respect to any Swingline
Loan or Eurodollar Revolving Loan, or with respect to the commitment fees
payable hereunder, as the case may be, the applicable rate per annum set forth
below under the caption "Eurodollar Spread", "Swingline Spread" or "Commitment
Fee Rate", as the case may be, based upon the ratings by Moody's and S&P,
respectively, applicable on such date to the Index Debt:

<PAGE>

================================================================================
       Index Debt Ratings             Commitment     Eurodollar      Swingline  
                                       Fee Rate        Spread         Spread    
--------------------------------------------------------------------------------
Category 1                                                                      
A- or higher by S&P                     .1000%        .4000%           .6000%   
A3 or higher by Moody's                                                         
--------------------------------------------------------------------------------
Category 2                                                                      
BBB+ by S&P                             .1250%        .4500%           .6500%   
Baa1 by Moody's                                                                 
--------------------------------------------------------------------------------
Category 3                                                                      
BBB by S&P                              .1875%        .5000%           .7000%   
Baa2 by Moody's                                                                 
--------------------------------------------------------------------------------
Category 4                                                                      
BBB- by S&P                             .2250%        .6250%           .8250%   
Baa3 by Moody's                                                                 
--------------------------------------------------------------------------------
Category 5                                                                      
BB+ by S&P                              .2750%        .7500%           .9500%   
Bal by Moody's                                                                  
--------------------------------------------------------------------------------
Category 6                                                                      
Lower than BB+ by S&P                   .3750%        1.000%           1.200%   
Lower than Bal by Moody's                                                       
================================================================================

          For purposes of the foregoing, (i) until, but not including, the first
anniversary of the date hereof, the Eurodollar Spread, Swingline Spread and
Commitment Fee Rate shall be determined by reference to Category 5, unless
Category 6 shall otherwise be applicable at any time during such period (in
which case the Eurodollar Spread, Swingline Spread and Commitment Fee Rate shall
be determined by reference to Category 6); (ii) if either Moody's or S&P shall
not have in effect a rating for the Index Debt (other than by reason of the
circumstances referred to in the last sentence of this definition), then such
rating agency shall be deemed to have established a rating in Category 6; (iii)
if the ratings established or deemed to have been established by Moody's and S&P
for the Index Debt shall fall within different Categories, the Applicable Rate
shall be based on the higher of the two ratings, except that (x) if the lower of
such ratings is two Categories below the higher of such ratings, the Applicable
Rate shall be determined based on the Category between the Categories in which
such ratings fall and (y) if the lower of such ratings is more than two
Categories below the higher of such ratings, the Applicable Rate shall be
determined based on the Category that is immediately above the Category in which
the lower of such ratings falls; and (iv) if the ratings established or deemed
to have been established by Moody's and S&P for the Index Debt shall be changed
(other than as a result of a change in the rating system of Moody's or S&P),
such change shall be effective as of the first Business Day following the
applicable ratings change. Each change in the Applicable Rate shall apply during
the period commencing on the date on which such change is publicly announced and
ending on the date immediately preceding the effective date of the next such
change. If the rating system of Moody's or S&P shall change, or if either such
rating agency shall cease to be in the business of rating corporate debt
obligations or either Moody's or S&P shall refuse to provide a rating of the
Index Debt (provided that the Borrower has used its best efforts to cause such
rating agency to provide such a rating, including the payment of any fees and
the provision of any information requested or required thereby in the ordinary
course conduct of its rating business), the Borrower 

<PAGE>

and the Lenders shall negotiate in good faith to amend this definition to
reflect such changed rating system or the unavailability of ratings from such
rating agency and, pending the effectiveness of any such amendment, the
Applicable Rate shall be determined by reference to the rating most recently in
effect prior to such change or cessation.

          "Asset Disposition" has the meaning assigned to it in Section 6.04.

          "Assignment and Acceptance" means an assignment and acceptance entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form approved by the Administrative Agent.

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

          "Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing (i) the
sum of the products of the numbers of years from the date of determination to
the dates of each successive scheduled principal payment of such Indebtedness or
redemption or similar payment with respect to such Preferred Stock multiplied by
the amount of such payment by (ii) the sum of all such payments. "Board" means
the Board of Governors of the Federal Reserve System of the United States of
America.

          "Board of Directors" means the Board of Directors of the Borrower or
any committee thereof duly authorized to act on behalf of such Board of
Directors.

          "Borrower" means ContiFinancial Corporation, a Delaware corporation.

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

          "Borrowing Base" means an amount equal to two times the amount by
which (a) the sum, without duplication, of (i) 100% of Eligible Cash & Cash
Equivalents, (ii) 95% of Eligible Receivables, (iii) 85% of Eligible Fixed
Income Investments, (iv) 85% of Eligible I/O Strip Securities, (v) 80% of
Eligible Performance Deposits, (vi) 75% of Capitalized Servicing Fees and (vii)
65% of Eligible Residuals (in each case excluding any assets set forth in
clauses (i) through (vii) above that are not Eligible Assets), exceeds (b)
Outstanding Funded Indebtedness. The amount of the Borrowing Base set forth in
any Borrowing Base Certificate may be reduced by the Borrower at its option for
any reason, including any failure of the Borrower to obtain the relevant
information from newly-acquired Restricted Subsidiaries in a timely manner. The
Borrowing Base at any time in effect shall be determined by reference to the
Borrowing Base Certificate most recently delivered to the Administrative Agent
pursuant to Sections 4.01(f) and 5.01(g). Notwithstanding the foregoing
provisions of this definition, at any time when the 

<PAGE>

Borrower shall have outstanding Index Debt that shall be Investment Grade, the
Borrowing Base will be deemed to equal the aggregate amount of the Commitments
in effect at such time.

          "Borrowing Base Certificate" means a certificate in the form of
Exhibit C prepared by the Borrower.

          "Borrowing Request" means a request by the Borrower for a Revolving
Borrowing in accordance with Section 2.03.

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

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

          "Capital Stock" of any Person means any and all shares, interests,
share capital, rights to subscribe for or purchase, warrants, options,
participations or other equivalents of or interests or membership interests in
(however designated) equity of such Person, including any Preferred Stock, any
limited or general partnership interest and any limited liability company
membership interest (but excluding any debt securities convertible into such
equity), and any rights to subscribe for or purchase any thereof.

          "Capitalized Servicing Fees" means servicing fees capitalized and
carried at fair value in accordance with GAAP on the balance sheet of the
Borrower and its Restricted Subsidiaries on a consolidated basis.

          "Change in Control" means the occurrence of any of the following
events:

               (i) Any "person" (as such term is used in Sections 13(d) and
          14(d) of the Exchange Act), other than any Permitted Holder, is or
          becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5
          under the Exchange Act, except that such person shall be deemed to
          have "beneficial ownership" of all shares that any such person has the
          right to acquire, whether such right is exercisable immediately or
          only after the passage of time), directly or indirectly, of more than
          35% of the total voting power of the Voting Stock of the Borrower;
          provided, however, that the Permitted Holders beneficially own (as
          defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly
          or indirectly, in the aggregate a lesser percentage of the total
          voting power of the Voting Stock of the 

<PAGE>

          Borrower than such other person and do not have the right or ability
          by voting power, contract or otherwise to elect or designate for
          election a majority of the Board of Directors (for the purposes of
          this clause (i), such other person shall be deemed to beneficially own
          any Voting Stock of a corporation held by another corporation (a
          "parent corporation"), if such other person is the beneficial owner
          (as defined above for such person), directly or indirectly, of more
          than 35% of the voting power of the Voting Stock of such parent
          corporation and the Permitted Holders beneficially own (as defined
          above for the Permitted Holders), directly or indirectly, in the
          aggregate a lesser percentage of the voting power of the Voting Stock
          of such parent corporation and do not have the right or ability by
          voting power, contract or otherwise to elect or designate for election
          a majority of the board of directors of such parent corporation);

               (ii) during any period of two consecutive years, individuals who
          at the beginning of such period constituted the Board of Directors
          (together with any new directors whose election by such Board of
          Directors or whose nomination for election by the shareholders of the
          Borrower was approved by a vote of 66-2/3% of the directors of the
          Borrower then still in office who were either directors at the
          beginning of such period or whose election or nomination for election
          was previously so approved) cease for any reason to constitute a
          majority of the Board of Directors then in office; or

               (iii) the merger or consolidation of the Borrower with or into
          another Person or the merger of another Person with or into the
          Borrower, or the sale of all or substantially all the assets of the
          Borrower to another Person (other than a Person that is controlled by
          the Permitted Holders), and, in the case of any such merger or
          consolidation, the securities of the Borrower that are outstanding
          immediately prior to such transaction and which represent 100% of the
          aggregate voting power of the Voting Stock of the Borrower are changed
          into or exchanged for cash, securities or property, unless pursuant to
          such transaction such securities are changed into or exchanged for, in
          addition to any other consideration, securities of the surviving
          corporation that represent immediately after such transaction, at
          least a majority of the aggregate voting power of the Voting Stock of
          the surviving corporation; provided, however, that the sale by the
          Borrower or its Restricted Subsidiaries from time to time solely of
          Receivables to a trust for the purpose solely of effecting one or more
          securitizations shall not be treated hereunder as a sale of all or
          substantially all the assets of the Borrower.

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

          "Class", when used in reference to any Loan or Borrowing, refers to
whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans
or Swingline Loans.

<PAGE>

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

          "Commitment" means, with respect to each Lender, the commitment of
such Lender to make Revolving Loans and to acquire participations in Swingline
Loans hereunder, expressed as an amount representing the maximum aggregate
amount of such Lender's Revolving Credit Exposure hereunder, as such commitment
may be (a) reduced from time to time pursuant to Section 2.07 and (b) reduced or
increased from time to time pursuant to assignments by or to such Lender
pursuant to Section 9.04. The initial amount of each Lender's Commitment is set
forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to which
such Lender shall have assumed its Commitment, as applicable. The initial
aggregate amount of the Lenders' Commitments is $200,000,000.

          "Consolidated EBIT" for any period, with respect to the Borrower and
its Restricted Subsidiaries on a consolidated basis, means Consolidated Net
Income for such period plus, to the extent deducted in computing Consolidated
Net Income for such period, (a) Consolidated Interest Expense for such period
and (b) foreign, Federal, state and local income tax expense for such period.

          "Consolidated Interest Coverage Ratio" for any period means the ratio
of Consolidated EBIT for such period to Consolidated Interest Expense for such
period.

          "Consolidated Interest Expense" for any period means the total
interest expense of the Borrower and its Restricted Subsidiaries on a
consolidated basis for such period.

          "Consolidated Leverage Ratio" as of any date of determination means
the ratio of (i) the aggregate amount of all Indebtedness of the Borrower and
its Restricted Subsidiaries on a consolidated basis as of such date (excluding
(A) Permitted Warehouse Indebtedness and (B) any Indebtedness under Hedging
Agreements Incurred pursuant to Section 6.05(b)) to (ii) Consolidated Net Worth
as of such date.

          "Consolidated Net Income" means the net income from continuing
operations (after taxes) of the Borrower and its Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP, excluding the effect
of extraordinary or non-recurring gains or losses (as such gains or losses are
determined in accordance with GAAP).

          "Consolidated Net Worth" means the total of the amounts shown on the
balance sheet of the Borrower and its Restricted Subsidiaries on a consolidated
basis as of the end of the most recent fiscal quarter of the Borrower for which
financial statements are available, as (i) the par or stated value of all
outstanding Capital Stock of the Borrower plus (ii) paid-in capital or capital
surplus relating to such Capital Stock plus (iii) any retained earnings or
earned surplus less (A) any accumulated deficit, (B) any amounts attributable to
Disqualified Stock and (C) any amounts attributable to deferred compensation
appropriately classified as net worth in accordance with GAAP.

<PAGE>

          "Continental Grain" means Continental Grain Company, a Delaware
corporation.

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

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

          "Disclosed Matters" means the actions, suits and proceedings and the
environmental matters disclosed in Schedule 3.06.

          "Disqualified Stock" means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable) or upon the happening of any event
(i) matures or is mandatorily redeemable pursuant to a sinking fund obligation
or otherwise, (ii) is convertible or exchangeable for Indebtedness or
Disqualified Stock or (iii) is redeemable at the option of the holder thereof,
in each case in whole or in part on or prior to the first anniversary of the
Maturity Date; provided, however, that any Capital Stock that would not
constitute Disqualified Stock but for provisions thereof giving holders thereof
the right to require such Person to repurchase or redeem such Capital Stock upon
the occurrence of a "change of control" occurring prior to the first anniversary
of the Maturity Date shall not constitute Disqualified Stock if the "change of
control" provisions applicable to such Capital Stock are not more favorable to
the holders of such Capital Stock than the Change in Control-related provisions
in Article VII.

          "dollars" or "$" refers to lawful money of the United States of
America.

          "Effective Date" means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).

          "Eligible Assets" means Eligible Cash & Cash Equivalents, Eligible
Fixed Income Investments, Eligible I/O Strip Securities, Eligible Performance
Deposits, Eligible Receivables, Eligible Residuals and Capitalized Servicing
Fees, in each case which are free and clear of all Liens (except that Eligible
Performance Deposits may be subject to a Lien in favor of the Person providing
the related Warehouse Facility if such Lien was created in connection with the
provision of such Warehouse Facility and secures the performance of assets
relating to such Warehouse Facility).

          "Eligible Cash & Cash Equivalents" means all cash and all Investments
of the Borrower and its Restricted Subsidiaries, determined on a consolidated
basis in accordance with GAAP, specified in any of clauses (a) through (d) of
the definition of Permitted Investments.

<PAGE>

          "Eligible Excess Spread Receivables" means Excess Spread Receivables
of the Borrower and its Restricted Subsidiaries on a consolidated basis created
after the date hereof; provided, however, that "Eligible Excess Spread
Receivables" shall not include any Excess Spread Receivables created as the
result of the securitization or sale of other Excess Spread Receivables.

          "Eligible Fixed Income Investments" means all Investments of the
Borrower and its Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP, of the type specified in clause (e) of the definition of
Permitted Investments.

          "Eligible I/O Strip Securities" means the book value of all I/O Strip
Securities of the Borrower and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP, that are rated at least Baa3 by
Moody's or BBB- by S&P, Duff & Phelps Credit Rating Co. or Fitch Investors
Service, L.P.

          "Eligible Performance Deposits" means the aggregate amount of all
Performance Deposits of the Borrower and its Restricted Subsidiaries, determined
on a consolidated basis, other than Performance Deposits relating to Warehouse
Facilities if the Borrower or a Restricted Subsidiary has determined (x) in the
case of purchase and sale Warehouse Facilities, not to repurchase and
subsequently securitize or sell the related Receivables or assets and (y) in the
case of Warehouse Facilities in the form of a loan, not to securitize or sell
the related Receivables or assets.

          "Eligible Performance Guarantees" means the aggregate amount of all
Performance Guarantees of the Borrower and its Restricted Subsidiaries,
determined on a consolidated basis, other than Performance Guarantees relating
to Warehouse Facilities if the Borrower or a Restricted Subsidiary has
determined (x) in the case of purchase and sale Warehouse Facilities, not to
repurchase and subsequently securitize or sell the related Receivables or assets
and (y) in the case of Warehouse Facilities in the form of a loan, not to
securitize or sell the related Receivables or assets.

          "Eligible Receivables" shall mean all Receivables (excluding
Performance Deposits, Capitalized Servicing Fees and Excess Spread Receivables)
of the Borrower and its Restricted Subsidiaries, determined on a consolidated
basis in accordance with GAAP, which are held for sale and are not past due by
more than 90 days; provided, however, that the aggregate amount of Eligible
Receivables at any time shall exclude (i) Eligible Receivables that are past due
by more than 30 days but less than 60 days to the extent that Eligible
Receivables past due by more than 30 days but less than 60 days would otherwise
constitute more than 7% of such aggregate amount of Eligible Receivables at such
time and (ii) Eligible Receivables that are past due by 60 days or longer to the
extent that Eligible Receivables past due by 60 days or longer would otherwise
constitute more than 3% of such aggregate amount of Eligible Receivables at such
time.

          "Eligible Residuals" shall mean all Excess Spread Receivables (other
than Eligible I/O Strip Securites) of the Borrower and its Restricted
Subsidiaries, determined on a consolidated basis, and carried at fair value, in
accordance with GAAP, excluding any such Excess Spread 

<PAGE>

Receivables created as the result of the securitization of existing Excess
Spread Receivables or the sale of Excess Spread Receivables.

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

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

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

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

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

          "Eurocurrency Reserve Requirements" means for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the rates (expressed as
a decimal 

<PAGE>

fraction) of reserve requirements in effect on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves under any
regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto) dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of such Board) maintained by a member bank of the Federal Reserve
System of the United States of America.

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

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

          "Excess Spread" means, over the life of a "pool" of Receivables that
have been sold by a Person to a trust or other Person in a securitization or
sale, the rights retained by such Person or a Restricted Subsidiary at or
subsequent to the closing of such securitization or sale to receive for its
benefit cash flows attributable to such "pool".

          "Excess Spread Receivables" of a Person means the contractual or
certificated right to Excess Spread capitalized on such Person's consolidated
balance sheet (the amount of which shall be the present value of the Excess
Spread, calculated in accordance with GAAP).

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.

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

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

<PAGE>

the Administrative Agent (or, when determined with respect to Swingline Loans,
the Swingline Lender) from three Federal funds brokers of recognized standing
selected by it.

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

          "Foreign Lender" means any Lender that is organized under the laws of
a jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.

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

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

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

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

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

<PAGE>

          "Incur" means issue, assume, Guarantee, incur or otherwise become
liable for; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Restricted Subsidiary (whether
by merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Person at the time it becomes a Restricted Subsidiary. The term
"Incurrence" when used as a noun shall have a correlative meaning. The accretion
of principal of a non-interest bearing or other discount security shall be
deemed the Incurrence of Indebtedness.

          "Indebtedness" means, with respect to any Person on any date of
determination (without duplication), (i) the principal of and premium (if any)
in respect of (A) indebtedness of such Person for money borrowed and (B)
indebtedness evidenced by notes, debentures, bonds or other similar instruments
for the payment of which such Person is responsible or liable; (ii) all Capital
Lease Obligations of such Person; (iii) all obligations of such Person issued or
assumed as the deferred purchase price of property, all conditional sale
obligations of such Person and all obligations of such Person under any title
retention agreement (but excluding trade accounts payable and expense accruals
arising in the ordinary course of business); (iv) all obligations of such Person
for the reimbursement of any obligor on any letter of credit, banker's
acceptance or similar credit transaction (other than obligations with respect to
letters of credit securing obligations (other than obligations described in (i)
through (iii) above) entered into in the ordinary course of business of such
Person to the extent such letters of credit are not drawn upon or, if and to the
extent drawn upon, such drawing is reimbursed no later than the tenth Business
Day following receipt by such Person of a demand for reimbursement following
payment on the letter of credit); (v) the amount of all obligations of such
Person with respect to the redemption, repayment or other repurchase of any
Disqualified Stock (but excluding any accrued dividends); (vi) Warehouse
Indebtedness; (vii) in connection with each sale by such Person of any Excess
Spread Receivables, the maximum aggregate contractual claim (if any) that the
purchaser thereof could have against such Person if the amounts anticipated at
the time of such sale to be received by such purchaser in connection with such
Excess Spread Receivables are not received by such purchaser; (viii) all
obligations of the type referred to in clauses (i) through (vii) of other
Persons and all dividends of other Persons for the payment of which, in either
case, such Person is responsible or liable, directly or indirectly, as obligor,
guarantor or otherwise, including by means of any Guarantee; (ix) all
obligations of the type referred to in clauses (i) through (viii) of other
Persons secured by any Lien on any property or asset of such Person (whether or
not such obligation is assumed by such Person), the amount of such obligation
being deemed to be the lesser of the value of such property or assets or the
amount of the obligation so secured and (x) to the extent not otherwise included
in this definition, Hedging Agreements of such Person. The amount of
Indebtedness of any Person at any date shall be the outstanding balance at such
date of all unconditional obligations as described above and the maximum
liability, upon the occurrence of the contingency giving rise to the obligation,
of any contingent obligations at such date. Notwithstanding the foregoing, any
securities issued in a securitization by a special purpose owner trust or
similar entity formed by or on behalf of a Person and to which Receivables or
Excess Spread Receivables have been sold or otherwise transferred by or on
behalf of such Person or its Subsidiaries shall not be treated as Indebtedness
of such Person or its Subsidiaries under this Agreement, regardless of whether
such securities are treated as indebtedness for tax purposes.

<PAGE>

          "Indemnified Taxes" means Taxes other than Excluded Taxes.

          "Index Debt" means senior, unsecured, long-term indebtedness for
borrowed money of the Borrower that is not guaranteed by any other Person or
subject to any other credit enhancement.

          "Interest Election Request" means a request by the Borrower to convert
or continue a Revolving Borrowing in accordance with Section 2.06.

          "Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each March, June, September and December, (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and (c) with respect to any Swingline Loan, the day
that such Loan is required to be repaid.

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

          "Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that are
recorded as trade accounts on the balance sheet of the lender) or other
extensions of credit (including by way of Guarantee or similar arrangement) or
capital contribution to (by means of any transfer of cash or other property to
others or any payment for property or services for the account or use of
others), or any purchase or acquisition of Capital Stock, Indebtedness or other
similar instruments issued by such Person. For purposes of the definition of
"Unrestricted Subsidiary", (i) "Investment" shall include the portion
(proportionate to the Borrower's equity interest in such Subsidiary) of the fair
market value of the net assets of any Subsidiary at the time that such
Subsidiary is designated an Unrestricted Subsidiary; provided, however, that
upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Borrower
shall be deemed to continue to have a permanent "Investment" in an Unrestricted
Subsidiary in an amount (if positive) equal to (x) the Borrower's "Investment"
in such Subsidiary at the time of such redesignation less (y) the portion
(proportionate to the Borrower's equity interest in such Subsidiary) of the fair
market value of the net assets of such Subsidiary at the time of such
redesignation; and (ii) any property transferred to or from an Unrestricted
Subsidiary shall be valued at its fair market value at the time of such
transfer, in each case as determined in good faith by the Board of Directors.

<PAGE>

          "Investment Grade" means, when used with reference to the Index Debt,
that such Index Debt shall be rated (a) at or above Baa3 (or the equivalent) by
Moody's and (b) at or above BBB- (or the equivalent) by S&P. Each rating of the
Index Debt will be effective on the date on which such rating is publicly
announced by the applicable rating agency. If the rating system of Moody's or
S&P shall change, or if either such rating agency shall cease to be in the
business of rating corporate debt obligations, the Borrower and the Lenders
shall negotiate in good faith to amend this definition to reflect such changed
rating system or the unavailability of ratings from such rating agency and,
pending the effectiveness of any such amendment, the applicable rating shall be
determined by reference to the rating most recently in effect prior to such
change or cessation.

          "I/O Strip Securities" means a certificate issued to the Borrower or a
Restricted Subsidiary in a securitization of a pool of Receivables (other than
Excess Spread Receivables) in the ordinary course of business of the Borrower
which pays a fixed or floating rate of interest on a notional principal amount.

          "Lenders" means the Persons listed on Schedule 2.01 and any other
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance, other than any such Person that ceases to be a party hereto pursuant
to an Assignment and Acceptance. Unless the context otherwise requires, the term
"Lenders" includes the Swingline Lender.

          "LIBO Rate" means the rate per annum determined by the Administrative
Agent at approximately 11:00 a.m., London time, on the date which is two
Business Days prior to the beginning of the relevant Interest Period by
reference to the British Bankers' Association Interest Settlement Rates for
deposits in dollars (as set forth by any service selected by the Administrative
Agent which has been nominated by the British Bankers' Association as an
authorized information vendor for the purpose of displaying such rates, which is
currently equivalent to such rate appearing on page 3750 of the Telerate screen)
for a period equal to such Interest Period (rounded upward to the nearest whole
multiple of 1/16th of 1%, if such rate is not such a multiple); provided that to
the extent that an interest rate is not ascertainable pursuant to the foregoing
provisions of this definition, the "LIBO Rate" shall be the interest rate per
annum determined by the Administrative Agent to be the average (rounded upward
to the nearest whole multiple of 1/16th of 1% per annum, if such average is not
such a multiple) of the rates per annum at which deposits in dollars are offered
for such relevant Interest Period to major banks in the London interbank market
in London, England by the Reference Banks, at approximately 11:00 a.m., London
time, on the date which is two Business Days prior to the beginning of such
Interest Period. If any of the Reference Banks shall be unable or shall
otherwise fail to supply such rates to the Administrative Agent upon its
request, the rate of interest shall, subject to the provisions of Section 2.12,
be determined on the basis of the quotations of the remaining Reference Banks or
Reference Bank.

          "Lien" means, with respect to any asset, (a) any mortgage, deed of
trust, lien, pledge, hypothecation, encumbrance, charge or security interest in,
on or of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title 

<PAGE>

retention agreement (or any financing lease having substantially the same
economic effect as any of the foregoing) relating to such asset, (c) in the case
of securities, any purchase option, call or similar right of a third party with
respect to such securities and (d) any claim (whether direct or indirect through
subordination or other structural encumbrance) against any Excess Spread
Receivable sold unless the seller is not liable for any losses thereon.

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

          "Margin Stock" has the meaning given such term under Regulation U.

          "Material Adverse Effect" means (a) a material adverse effect on the
business, assets, operations, prospects or condition, financial or otherwise, of
the Borrower and the Restricted Subsidiaries taken as a whole, (b) a material
adverse effect on the ability of the Borrower to perform any of its obligations
under this Agreement or (c) a material adverse effect on the rights of or
benefits available to the Lenders under this Agreement.

          "Material Indebtedness" means Indebtedness (other than the Loans), or
obligations in respect of one or more Hedging Agreements, of any one or more of
the Borrower and its Restricted Subsidiaries in an aggregate principal amount
exceeding $5,000,000 (or the equivalent amount in any other currency). For
purposes of determining Material Indebtedness, the "principal amount" of the
obligations of the Borrower or any Restricted Subsidiary in respect of any
Hedging Agreement at any time shall be the maximum aggregate amount (giving
effect to any netting agreements) that the Borrower or such Restricted
Subsidiary would be required to pay if such Hedging Agreement were terminated at
such time.

          "Maturity Date" means the third anniversary of the Effective Date.

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

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

          "Net Available Cash" from an Asset Disposition means cash payments
received therefrom (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or otherwise,
but only as and when received, but excluding any other consideration received in
the form of assumption by the acquiring Person of Indebtedness or other
obligations relating to such properties or assets or received in any other
noncash form) in each case net of (i) all legal, title and recording tax
expenses, commissions and other fees and expenses incurred, and all Federal,
state, provincial, foreign and local taxes required to be accrued as a liability
under GAAP, as a consequence of such Asset Disposition, (ii) all payments made
on any Indebtedness which is secured by any assets subject to such Asset
Disposition, in accordance with the terms of any Lien upon or other security
agreement of any kind with respect to such assets, or which must by its terms,
or in order to obtain a necessary consent to such Asset Disposition, or by
applicable law, be repaid out of the proceeds from such 

<PAGE>

Asset Disposition, (iii) all distributions and other payments required to be
made to minority interest holders in Subsidiaries or joint ventures as a result
of such Asset Disposition and (iv) the deduction of appropriate amounts provided
by the seller as a reserve, in accordance with GAAP, against any liabilities
associated with the property or other assets disposed of in such Asset
Disposition and retained by the Borrower or any Restricted Subsidiary after such
Asset Disposition; provided that "Net Available Cash" will be increased by the
amount of any such reserve to the extent such reserve is reversed.

          "Other Taxes" means any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement, other than Excluded Taxes.

          "Outstanding Funded Indebtedness" means all outstanding Indebtedness
of the Borrower and its Restricted Subsidiaries on a consolidated basis
excluding (a) the Loans, (b) any Indebtedness constituting Hedging Agreement
obligations, (c) 80% of the aggregate amount of Eligible Performance Guarantees
and (d) all Permitted Warehouse Indebtedness.

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

          "Performance Deposits" means the right of the Borrower or any
Restricted Subsidiary to receive from the purchaser or lender providing any
Warehouse Facility an amount equal to (x) the face value of the assets which are
the subject of such Warehouse Facility less (y) the sum of (i) the amount of
cash actually received by the Borrower or such Restricted Subsidiary as proceeds
of such Warehouse Facility and (ii) the aggregate amount of all Performance
Guarantees provided in connection with such Warehouse Facility; provided that no
such Performance Deposit shall, when taken together with the aggregate amount of
all Performance Guarantees relating to the applicable Warehouse Facility, in any
event exceed 10% of the face value of the assets which are the subject of such
Warehouse Facility.

          "Performance Guarantee" means any Guarantee of the Borrower or any
Restricted Subsidiary for the benefit of the provider of a Warehouse Facility of
obligations relating to Receivables which are the subject of a Warehouse
Facility in an amount which, when taken together with the aggregate amount of
all Performance Deposits relating to the applicable Warehouse Facility, is no
greater than 10% of the face value of the Receivables which are the subject of
such Warehouse Facility; provided that such Guarantee has the same economic
effect as a Performance Deposit.

          "Permitted Holders" means lineal descendants of Jules Fribourg,
including any individual legally adopted; spouses of such descendants; trusts,
the beneficiaries of which are any of the foregoing; partnerships, corporations,
or other entities in which any of the foregoing (individually or collectively)
has a controlling interest; and charitable organizations established by any of
the foregoing.

<PAGE>

          "Permitted Investments" means:

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

          (b) investments in commercial paper, maturing not more than 180 days
     after the date of acquisition, issued by a corporation (other than an
     Affiliate of the Borrower) organized and in existence under the laws of the
     United States of America or any foreign country recognized by the United
     States of America with a rating at the time as of which any investment
     therein is made of "P-1" (or higher) according to Moody's or "A-1" (or
     higher) according to S&P;

          (c) investments in time deposit accounts, certificates of deposit and
     money market deposits maturing within 180 days of the date of acquisition
     thereof issued by a bank or trust company that is not an Affiliate of the
     Borrower and which is organized under the laws of the United States of
     America, any state thereof or any foreign country recognized by the United
     States, and which bank or trust company has capital, surplus and undivided
     profits aggregating in excess of $200,000,000 (or the foreign currency
     equivalent thereof) and has outstanding debt which is rated "A" (or such
     similar equivalent rating) or higher by at least one nationally recognized
     statistical rating organization (as defined in Rule 436 under the
     Securities Act of 1933, as amended) or any money-market fund sponsored by a
     registered broker dealer or mutual fund distributor;

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

          (e) investments in securities with maturities of six months or less
     from the date of acquisition issued or fully guaranteed by any state,
     commonwealth or territory of the United States of America, or by any
     political subdivision or taxing authority thereof, and rated at least "A"
     by S&P or "A2" by Moody's.

          "Permitted Warehouse Indebtedness" means Warehouse Indebtedness in
connection with a Warehouse Facility; provided, however, that (i) the assets as
to which such Warehouse Indebtedness relates are or, prior to any funding under
the related Warehouse Facility with respect to such assets were, eligible to be
recorded as held for sale on the balance sheet of the Borrower and its
Restricted Subsidiaries in accordance with GAAP, (ii) such Warehouse
Indebtedness will be deemed to be Permitted Warehouse Indebtedness except to the
extent the holders of such Warehouse Indebtedness have contractual recourse to
the Borrower or its Restricted Subsidiaries to satisfy claims in respect of such
Warehouse Indebtedness in excess of, without duplication, (A) the realizable
value of the assets to which such Warehouse Indebtedness relates and (B) any
Performance Deposit securing such Warehouse Indebtedness or any 

<PAGE>

Performance Guarantee supporting such Warehouse Indebtedness, and (iii) any such
Indebtedness has not been outstanding in excess of 364 days.

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

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

          "Preferred Stock", as applied to the Capital Stock of any Person,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.

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

          "Receivables" means consumer and commercial loans, leases and
receivables purchased or originated by the Borrower, any Restricted Subsidiary
or a Strategic Alliance Client in the ordinary course of business; provided,
however, that for purposes of determining the amount of a Receivable at any
time, such amount shall be determined in accordance with GAAP, consistently
applied, as of the most recent practicable date.

          "Reference Banks" means Credit Suisse, Dresdner Bank AG and The Bank
of New York.

          "Refinance" means, in respect of any Indebtedness, to refinance,
extend, renew, refund, repay, prepay, redeem, defease or retire, or to issue
other Indebtedness in exchange or replacement for, such Indebtedness.
"Refinanced" and "Refinancing" shall have correlative meanings.

          "Refinancing Indebtedness" means Indebtedness that Refinances any
Indebtedness of the Borrower or any Restricted Subsidiary existing on the date
hereof or Incurred in compliance with this Agreement (including Indebtedness
that Refinances Refinancing Indebtedness); provided, however, that (i) such
Refinancing Indebtedness has a Stated Maturity no earlier than the Stated
Maturity of the Indebtedness being Refinanced, (ii) such Refinancing
Indebtedness has an Average Life at the time such Refinancing Indebtedness is
Incurred that is equal to or greater than the Average Life of the Indebtedness
being Refinanced and (iii) such Refinancing Indebtedness has an aggregate
principal amount (or if Incurred with original issue discount, an aggregate
issue price) that is equal to or less than the aggregate principal amount (or 

<PAGE>

if Incurred with original issue discount, the aggregate accreted value) then
outstanding or committed (plus fees and expenses, including any premium and
defeasance costs) under the Indebtedness being Refinanced; provided further,
however, that Refinancing Indebtedness shall not include (x) Indebtedness of a
Subsidiary that Refinances Indebtedness of the Borrower or another Subsidiary or
(y) Indebtedness of the Borrower or a Restricted Subsidiary that Refinances
Indebtedness of an Unrestricted Subsidiary.

          "Register" has the meaning set forth in Section 9.04.

          "Related Business" means any consumer or commercial finance business
or any financial service business.

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

          "Required Lenders" means, at any time, Lenders having aggregate
Revolving Credit Exposures and unused Commitments representing more than 50% of
the sum of the total Revolving Credit Exposures and unused Commitments at such
time.

          "Restricted Subsidiary" means any Subsidiary that is not an
Unrestricted Subsidiary.

          "Revolving Borrowing" means a Borrowing of Revolving Loans.

          "Revolving Credit Exposure" means, with respect to any Lender at any
time, the sum of the outstanding principal amount of such Lender's Revolving
Loans and its Swingline Exposure at such time.

          "Revolving Loan" means a Loan made pursuant to Section 2.03.

          "Rolling Period" means, at any time, the fiscal quarter most recently
ended and the three immediately preceding fiscal quarters, considered as a
single accounting period.

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

          "Stated Maturity" means, with respect to any security or Indebtedness,
the date specified in such security or Indebtedness as the fixed date on which
the final payment of principal of such security is due and payable, including
pursuant to any mandatory redemption provision (but excluding any provision
providing for the repurchase of such security at the option of the holder
thereof upon the happening of any contingency unless such contingency has
occurred).

          "Strategic Alliance Client" means any Person (other than a Restricted
Subsidiary) engaged in a Related Business to which the Borrower provides, or
reasonably expects to provide, 

<PAGE>

financing or asset securitization expertise in return for asset-backed
underwriting or placement agent commitments.

          "subsidiary" means, with respect to any Person (the "parent") at any
date, any corporation, limited liability company, partnership, association or
other entity the accounts of which would be consolidated with those of the
parent in the parent's consolidated financial statements if such financial
statements were prepared in accordance with GAAP as of such date, as well as any
other corporation, limited liability company, partnership, association or other
entity (a) of which securities or other ownership interests representing more
than 50% of the equity or more than 50% of the ordinary voting power or, in the
case of a partnership, more than 50% of the general partnership interests are,
as of such date, owned, controlled or held, or (b) that is, as of such date,
otherwise Controlled, by the parent or one or more subsidiaries of the parent or
by the parent and one or more subsidiaries of the parent.

          "Subsidiary" means any subsidiary of the Borrower.

          "Swingline Exposure" means, at any time, the aggregate principal
amount of all Swingline Loans outstanding at such time. The Swingline Exposure
of any Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.

          "Swingline Lender" means Dresdner Bank AG, New York and Grand Cayman
Branches, in its capacity as lender of Swingline Loans hereunder.

          "Swingline Loan" means a Loan made pursuant to Section 2.04.

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

          "Transactions" means the execution, delivery and performance by the
Borrower of this Agreement, the borrowing of Loans and the use of the proceeds
thereof.

          "Type", when used in reference to any Loan or Borrowing, refers (x) in
the case of a Swingline Loan or a Borrowing of a Swingline Loan, to Swingline
Loans and (y) in the case of Revolving Loans, to whether the rate of interest on
such Loan, or on the Loans comprising such Borrowing, is determined by reference
to the Adjusted LIBO Rate or the Alternate Base Rate.

          "Unrestricted Subsidiary" means (i) any Subsidiary that at the time of
determination shall be designated an Unrestricted Subsidiary by the Board of
Directors in the manner provided below and (ii) any Subsidiary of an
Unrestricted Subsidiary. The Board of Directors may designate any Subsidiary
(including any newly acquired or newly formed Subsidiary) to be an Unrestricted
Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Capital
Stock or Indebtedness of, or holds any Lien on any property of, the Borrower or
any other Subsidiary that is not a Subsidiary of the Subsidiary to be so
designated; provided, however, that no Default shall have occurred and be
continuing or would occur as a result thereof, and each representation and
warranty of the Borrower contained in Article III shall be 

<PAGE>

true and correct in all material respects after giving effect to such
designation. Any such designation by the Board of Directors shall be evidenced
by the Borrower to the Administrative Agent by promptly filing with the
Administrative Agent a copy of the board resolution giving effect to such
designation and a certificate, signed by two executive officers, certifying that
such designation complied with the foregoing provisions.

          "Voting Stock" of a Person means all classes of Capital Stock or other
interests (including partnership interests or membership interests) of such
Person then outstanding and normally entitled (without regard to the occurrence
of any contingency) to vote in the election of directors, managers or trustees
thereof.

          "Warehouse Facility" means any funding arrangement with a financial
institution or other lender or purchaser exclusively to finance the purchase or
origination of Receivables by the Borrower, a Subsidiary or a Strategic Alliance
Client for the purpose of pooling such Receivables prior to securitization or
sale in the ordinary course of business, including purchase and sale facilities
pursuant to which the Borrower or a Subsidiary sells Receivables or debt of a
Strategic Alliance Client secured by Receivables owned or financed by such
Strategic Alliance Client to a financial institution and retains a right of
first refusal upon the subsequent resale of such Receivables or debt by such
financial institution.

          "Warehouse Indebtedness" means the greater of (x) the consideration
received by the Borrower or its Restricted Subsidiaries under a Warehouse
Facility and (y) the book value of the assets financed under a Warehouse
Facility with respect to Receivables or debt of a Strategic Alliance Client
secured by Receivables owned or financed by such Strategic Alliance Client until
such time as such Receivables or debt are (i) securitized, (ii) repurchased by
the Borrower or its Restricted Subsidiaries or (iii) sold by the counterparty
under the Warehouse Facility to a Person who is not an Affiliate of the
Borrower.

          "Wholly Owned Subsidiary" means a Restricted Subsidiary all the
Capital Stock of which (other than directors' qualifying shares and shares held
by other Persons to the extent such shares are required by applicable law to be
held by a Person other than the Borrower or a Restricted Subsidiary) is owned by
the Borrower or one or more Wholly Owned Subsidiaries.

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

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

<PAGE>

          SECTION 1.03. Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.

          SECTION 1.04. Accounting Terms; GAAP. Except as otherwise expressly
provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided
that, if the Borrower notifies the Administrative Agent that the Borrower
requests an amendment to any provision hereof to eliminate the effect of any
change occurring after the date hereof in GAAP or in the application thereof on
the operation of such provision (or if the Administrative Agent notifies the
Borrower that the Required Lenders request an amendment to any provision hereof
for such purpose), regardless of whether any such notice is given before or
after such change in GAAP or in the application thereof, then such provision
shall be interpreted on the basis of GAAP as in effect and applied immediately
before such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith.

                                   ARTICLE II

                                   The Credits

          SECTION 2.01. Commitments. Subject to the terms and conditions set
forth herein, each Lender agrees to make Revolving Loans to the Borrower from
time to time during the Availability Period in an aggregate principal amount
that will not result in such Lender's Revolving Credit Exposure exceeding the
lesser of (a) such Lender's Commitment and (b) such Lender's Applicable
Percentage of the Borrowing Base in effect at such time. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, prepay and reborrow Revolving Loans.

          SECTION 2.02. Loans and Borrowings. (a) Each Revolving Loan shall be
made as part of a Borrowing consisting of Revolving Loans made by the Lenders
ratably in accordance 

<PAGE>

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

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

          (c) At the commencement of each Interest Period for any Eurodollar
Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an
integral multiple of $1,000,000 and not less than $5,000,000. At the time that
each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate
amount that is an integral multiple of $1,000,000 and not less than $5,000,000;
provided that an ABR Revolving Borrowing may be in an aggregate amount that is
equal to the aggregate unused balance of the Commitments. Each Swingline Loan
shall be in an amount that is an integral multiple of $1,000,000. Borrowings of
more than one Type and Class may be outstanding at the same time; provided that
there shall not at any time be more than six Borrowings outstanding (provided
that for purposes of the foregoing proviso (i) all ABR Borrowings outstanding at
any time shall be deemed to constitute a single Borrowing and (ii) all Swingline
Borrowings outstanding at any time shall be deemed to constitute a single
Borrowing).

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

          SECTION 2.03. Requests for Revolving Borrowings. To request a
Revolving Borrowing, the Borrower shall notify the Administrative Agent of such
request by telephone (a) in the case of a Eurodollar Borrowing, not later than
12:00 noon, New York City time, three Business Days before the date of the
proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 12:00
noon, New York City time, one Business Day before the date of the proposed
Borrowing. Each such telephonic Borrowing Request shall be irrevocable and shall
be confirmed promptly by hand delivery or telecopy to the Administrative Agent
of a written Borrowing Request in a form approved by the Administrative Agent
and signed by the Borrower. Each such telephonic and written Borrowing Request
shall specify the following information in compliance with Section 2.02:

          (i) the aggregate amount of the requested Borrowing;

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


<PAGE>

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

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

          (v) the location and number of the Borrower's account to which funds
     are to be disbursed, which shall comply with the requirements of Section
     2.05.

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

          SECTION 2.04. Swingline Loans. (a) Subject to the terms and conditions
set forth herein, the Swingline Lender agrees to make Swingline Loans to the
Borrower from time to time during the Availability Period, in an aggregate
principal amount at any time outstanding that will not result in (i) the
aggregate principal amount of outstanding Swingline Loans exceeding $30,000,000
or (ii) the aggregate Revolving Credit Exposures exceeding the lesser of (x) the
aggregate Commitments and (y) the Borrowing Base in effect at such time;
provided that the Swingline Lender shall not be required to make a Swingline
Loan to refinance an outstanding Swingline Loan. Within the foregoing limits and
subject to the terms and conditions set forth herein, the Borrower may borrow,
prepay and reborrow Swingline Loans.

          (b) To request a Swingline Loan, the Borrower shall concurrently
notify the Administrative Agent and the Swingline Lender of such request by
telephone (confirmed by telecopy), not later than 12:00 noon, New York City
time, on the day of a proposed Swingline Loan. Each such notice shall be
irrevocable and shall specify the requested date (which shall be a Business Day
and may be the same Business Day on which such Swingline Loan is to be made) and
amount of the requested Swingline Loan. The Swingline Lender shall make each
Swingline Loan available to the Borrower by means of a credit to the general
deposit account of the Borrower with the Swingline Lender by 3:00 p.m., New York
City time, on the requested date of such Swingline Loan.

          (c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 10:00 a.m., New York City time, on any
Business Day require the Lenders to acquire participations on such Business Day
in all or a portion of the Swingline Loans outstanding, provided that such
Swingline Loans are free and clear of all Liens. Such notice shall specify the
aggregate amount of Swingline Loans in which Lenders will participate. Promptly
upon receipt of such notice, the Administrative Agent will give notice thereof
to each Lender, specifying in such notice such Lender's Applicable Percentage of
such Swingline Loan or Loans. Each Lender hereby absolutely and unconditionally
agrees, upon receipt of notice as provided 

<PAGE>

above, to pay to the Administrative Agent, for the account of the Swingline
Lender, such Lender's Applicable Percentage of such Swingline Loan or Loans.
Each Lender acknowledges and agrees that its obligation to acquire
participations in Swingline Loans pursuant to this paragraph is absolute and
unconditional and shall not be affected by any circumstance whatsoever,
including the occurrence and continuance of a Default or reduction or
termination of the Commitments, and that each such payment shall be made without
any offset, abatement, withholding or reduction whatsoever. Each Lender shall
comply with its obligation under this paragraph by wire transfer of immediately
available funds, in the same manner as provided in Section 2.05 with respect to
Loans made by such Lender (and Section 2.05 shall apply, mutatis mutandis, to
the payment obligations of the Lenders), and the Administrative Agent shall
promptly pay to the Swingline Lender the amounts so received by it from the
Lenders. The Administrative Agent shall notify the Borrower of any
participations in any Swingline Loan acquired pursuant to this paragraph, and
thereafter payments in respect of such Swingline Loan shall be made to the
Administrative Agent and not to the Swingline Lender. Any amounts received by
the Swingline Lender from the Borrower (or other party on behalf of the
Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender
of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent; any such amounts received by the Administrative
Agent shall be promptly remitted by the Administrative Agent to the Lenders that
shall have made their payments pursuant to this paragraph and to the Swingline
Lender, as their interests may appear. The purchase of participations in a
Swingline Loan pursuant to this paragraph shall not relieve the Borrower of any
default in the payment thereof. Notwithstanding the foregoing, a Lender shall
not have any obligation to acquire a participation in a Swingline Loan pursuant
to this paragraph if a Default shall have occurred and be continuing at the time
such Swingline Loan was made and such Lender shall have notified the Swingline
Lender in writing, at least one Business Day prior to the time such Swingline
Loan was made, that such Default has occurred and that such Lender will not
acquire participations in Swingline Loans made while such Default is continuing.
SECTION 2.05. Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by it hereunder on the proposed date thereof by wire transfer of
immediately available funds by 12:00 noon, New York City time, to the account of
the Administrative Agent most recently designated by it for such purpose by
notice to the Lenders; provided that Swingline Loans shall be made as provided
in Section 2.04. The Administrative Agent will make such Revolving Loans
available to the Borrower by promptly crediting the amounts so received, in like
funds, to an account of the Borrower maintained with the Administrative Agent in
New York City and designated by the Borrower in the applicable Borrowing
Request.

          (b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the Administrative Agent such Lender's share of such
Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section
and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and, if such Lender fails to pay such amount immediately upon
demand, the Borrower, agrees to pay to the Administrative Agent forthwith on
demand such corresponding amount with interest thereon, for each day from and
including the date such amount is made available to the Borrower to but

<PAGE>

excluding the date of payment to the Administrative Agent, at (i) in the case of
such Lender, the Federal Funds Effective Rate or (ii) in the case of the
Borrower, the interest rate applicable to ABR Loans. If such Lender pays such
amount to the Administrative Agent, then such amount shall constitute such
Lender's Loan included in such Borrowing. If the Borrower pays such amount to
the Administrative Agent, it shall not thereby waive any claim it may have
against such Lender.

          SECTION 2.06. Interest Elections. (a) Each Revolving Borrowing
initially shall be of the Type specified in the applicable Borrowing Request
and, in the case of a Eurodollar Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request. Thereafter, the Borrower may
elect to convert such Revolving Borrowing to a different Type or to continue
such Revolving Borrowing and, in the case of a Eurodollar Borrowing, may elect
Interest Periods therefor, all as provided in this Section. The Borrower may
elect different options with respect to different portions of the affected
Revolving Borrowing, in which case each such portion shall be allocated ratably
among the Lenders holding the Loans comprising such Revolving Borrowing, and the
Loans comprising each such portion shall be considered a separate Revolving
Borrowing. This Section shall not apply to Swingline Borrowings, which may not
be converted or continued.

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

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

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

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

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

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


<PAGE>

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

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

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

          SECTION 2.07. Termination and Reduction of Commitments. (a) Unless
previously terminated, the Commitments shall terminate on the Maturity Date.

          (b) The Borrower may at any time terminate, or from time to time
reduce, the Commitments; provided that (i) each reduction of the Commitments
shall be in an amount that is an integral multiple of $1,000,000 and not less
than $5,000,000 and (ii) the Borrower shall not terminate or reduce the
Commitments if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 2.09, the sum of the Revolving Credit Exposures would
exceed the total Commitments.

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

          SECTION 2.08. Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay (i) to the Administrative Agent for the
account of each Lender the then unpaid principal amount of each Revolving Loan
on the Maturity Date and (ii) to the Swingline Lender (or, with respect to
Swingline Loans with respect to which participations have been purchased by
Lenders pursuant to Section 2.04(c), to the Administrative Agent for the 


<PAGE>

benefit of the Lenders) the then unpaid principal amount of each Swingline Loan
on the earliest of (A) the Maturity Date, (B) the seventh Business Day after
such Swingline Loan is made and (C) if on the day such Swingline Loan was made
one or more other Swingline Loans were outstanding ("existing Swingline Loans"),
the seventh Business Day after the first of such existing Swingline Loans was
made; provided that on each date that a Revolving Borrowing is made, the
Borrower shall repay all Swingline Loans then outstanding.

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

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

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

          (e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).

          SECTION 2.09. Prepayment of Loans. (a) The Borrower shall have the
right at any time and from time to time to prepay any Borrowing in whole or in
part, subject to prior notice in accordance with paragraph (b) of this Section.

     (b) The Borrower shall notify the Administrative Agent (and, in the case of
payment of a Swingline Loan, the Swingline Lender and the Administrative Agent)
by telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case
of prepayment of a Eurodollar Revolving Borrowing, not later than 12:00 noon,
New York City time, three Business Days before the date of prepayment, (ii) in
the case of prepayment of an ABR Revolving Borrowing, not later than 12:00 noon,
New York City time, one Business Day before the date of prepayment or (iii) in
the case of payment of a Swingline Loan, not later than 12:00 noon, New York
City time, on the date 


<PAGE>

of prepayment. Each such notice shall be irrevocable and shall specify the
prepayment or payment date and the principal amount of each Borrowing or portion
thereof to be prepaid or repaid; provided that, if a notice of prepayment is
given in connection with a conditional notice of termination of the Commitments
as contemplated by Section 2.07, then such notice of prepayment may be revoked
if such notice of termination is revoked in accordance with Section 2.07.
Promptly following receipt of any such notice relating to a Revolving Borrowing,
the Administrative Agent shall advise the Lenders of the contents thereof. Each
partial prepayment of any Revolving Borrowing shall be in an amount that would
be permitted in the case of an advance of a Revolving Borrowing of the same Type
as provided in Section 2.02. Each prepayment of a Revolving Borrowing shall be
applied ratably to the Loans included in the prepaid Borrowing. Prepayments and
payments in accordance with this Section 2.09 shall be accompanied by accrued
interest to the extent required by Section 2.11. The Borrower and the Swingline
Lender will notify the Administrative Agent promptly following any payment by
the Borrower with respect to any Swingline Loan.

          (c) If at any time the Revolving Credit Exposure exceeds the Borrowing
Base, the Borrower shall forthwith prepay the then outstanding Loans by such
amount as shall be necessary to eliminate such excess.

          SECTION 2.10. Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender on the last day of March,
June, September and December in each year, commencing on the first such date to
occur after the date hereof, and on each date on which the Commitment of such
Lender shall be reduced, expire or be terminated as provided herein, a
commitment fee, which shall accrue at the Applicable Rate on the average daily
amount by which the Commitment of such Lender exceeds its outstanding Revolving
Loans during the preceding quarter (or other period commencing with the date
hereof or ending with the date on which such Commitment shall expire or be
terminated). All commitment fees shall be computed on the basis of a year of 360
days and shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The commitment fee due to each Lender
shall commence to accrue on the date hereof and shall cease to accrue on the
date on which the Commitment of such Lender shall expire or be terminated as
provided herein.

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

          (c) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for distribution, in
the case of commitment fees, to the Lenders. Fees paid shall not be refundable
under any circumstances.

          SECTION 2.11. Interest. (a) The Loans comprising each ABR Borrowing
shall bear interest at the Alternate Base Rate.

          (b) The Loans comprising each Eurodollar Borrowing shall bear interest
at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing
plus the Applicable Rate.

<PAGE>

          (c) Each Swingline Loan shall bear interest at the Federal Funds
Effective Rate plus the Applicable Rate.

          (d) Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided in paragraph (a) of this Section.

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

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

          SECTION 2.12. Alternate Rate of Interest. If prior to the commencement
of any Interest Period for a Eurodollar Borrowing:

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

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

then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent 

<PAGE>

notifies the Borrower and the Lenders that the circumstances giving rise to such
notice no longer exist, (i) any Interest Election Request that requests the
conversion of any Revolving Borrowing to, or continuation of any Revolving
Borrowing as, a Eurodollar Borrowing shall be ineffective and (ii) if any
Borrowing Request requests a Eurodollar Revolving Borrowing, such Borrowing
shall be made as an ABR Borrowing.

          SECTION 2.13. Increased Costs. (a) If any Change in Law shall:

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

          (ii) impose on any Lender or the London interbank market any other
     condition affecting this Agreement or Eurodollar Loans made by such Lender;

and the result of any of the foregoing shall be to increase the cost to such
Lender of making or maintaining any Eurodollar Loan (or of maintaining its
obligation to make any such Loan) or to reduce the amount of any sum received or
receivable by such Lender (whether of principal, interest or otherwise), then
the Borrower will pay to such Lender such additional amount or amounts as will
compensate such Lender for such additional costs incurred or reduction suffered
(excluding the effect of any Excluded Taxes).

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

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

          (d) Failure or delay on the part of any Lender to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender's right to
demand such compensation; provided that the Borrower shall not be required to
compensate a Lender pursuant to this Section for any increased costs or
reductions incurred more than 270 days prior to the date that such Lender
notifies the Borrower of the Change in Law giving rise to such increased costs
or 

<PAGE>

reductions and of such Lender's intention to claim compensation therefor;
provided further that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the 270-day period referred to above shall be
extended to include the period of retroactive effect thereof.

          SECTION 2.14. Break Funding Payments. In the event of (a) the payment
of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Revolving Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice may be revoked
under Section 2.09(b) and is revoked in accordance therewith), or (d) the
assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.17, then, in any such event, the Borrower shall compensate each Lender
for the loss, cost and expense attributable to such event. In the case of a
Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to
include an amount determined by such Lender to be the excess, if any, of (i) the
amount of interest which would have accrued on the principal amount of such Loan
had such event not occurred, at the Adjusted LIBO Rate that would have been
applicable to such Loan, for the period from the date of such event to the last
day of the then current Interest Period therefor (or, in the case of a failure
to borrow, convert or continue, for the period that would have been the Interest
Period for such Loan), over (ii) the amount of interest which would accrue on
such principal amount for such period at the interest rate which such Lender
would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market. A certificate of any Lender setting forth any amount or amounts (and, in
reasonable detail, the calculations relating thereto) that such Lender is
entitled to receive pursuant to this Section shall be delivered to the Borrower
and shall be conclusive absent manifest error. The Borrower shall pay such
Lender the amount shown as due on any such certificate within 10 days after
receipt thereof.

          SECTION 2.15. Taxes. (a) Any and all payments by or on account of any
obligation of the Borrower hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that if the
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent or such
Lender (as the case may be) receives an amount equal to the sum it would have
received had no such deductions been made, (ii) the Borrower shall make such
deductions and (iii) the Borrower shall pay the full amount deducted to the
relevant Governmental Authority in accordance with applicable law.

          (b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

          (c) The Borrower shall indemnify the Administrative Agent and each
Lender, within 10 days after written demand therefor, for the full amount of any
Indemnified Taxes or 

<PAGE>

Other Taxes paid by the Administrative Agent or such Lender, as the case may be,
on or with respect to any payment by or on account of any obligation of the
Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or
asserted on or attributable to amounts payable under this Section) and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. A
certificate as to the amount of such payment or liability (showing in reasonable
detail the calculation of such amount) delivered to the Borrower by a Lender, or
by the Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.

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

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

          SECTION 2.16. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) The Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest or fees, or of amounts payable under
Section 2.13, 2.14 or 2.15, or otherwise) prior to 12:00 noon, New York City
time, on the date when due, in immediately available funds, without set-off or
counterclaim. Any amounts received after such time on any date may, in the
discretion of the Administrative Agent, be deemed to have been received on the
next succeeding Business Day for purposes of calculating interest thereon. All
such payments shall be made to the Administrative Agent at its offices at One
Liberty Plaza, New York, New York, except that payments of interest on and
principal of Swingline Loans shall be made directly to the Swingline Lender at
its offices at 75 Wall Street, New York, New York, and except that payments
pursuant to Sections 2.13, 2.14, 2.15 and 9.03 shall be made directly to the
Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate
recipient promptly following receipt thereof. If any payment hereunder shall be
due on a day that is not a Business Day, the date for payment shall be extended
to the next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension.
All payments hereunder shall be made in dollars.

          (b) If at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all amounts of principal, interest and
fees then due hereunder, such funds shall be applied (i) first, towards payment
of interest and fees then due hereunder, 

<PAGE>

ratably among the parties entitled thereto in accordance with the amounts of
interest and fees then due to such parties, and (ii) second, towards payment of
principal then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of principal then due to such parties.

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

          (d) Unless the Administrative Agent shall have received notice from
the Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders hereunder that the Borrower will not make
such payment, the Administrative Agent may assume that the Borrower has made
such payment on such date in accordance herewith and may, in reliance upon such
assumption, distribute to the Lenders the amount due. In such event, if the
Borrower has not in fact made such payment, then each of the Lenders severally
agrees to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date of
payment to the Administrative Agent, at the Federal Funds Effective Rate, as
determined by the Administrative Agent.

          (e) If any Lender shall fail to make any payment required to be made
by it pursuant to Section 2.04(c), 2.05(b) or 2.16(d), then the Administrative
Agent may, in its discretion (notwithstanding any contrary provision hereof),
apply any amounts thereafter received by the Administrative Agent for the
account of such Lender to satisfy such Lender's obligations under such Sections
until all such unsatisfied obligations are fully paid.

<PAGE>

          SECTION 2.17. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.13, or if the Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.15, then such
Lender shall use reasonable efforts, including designating a different lending
office for funding or booking its Loans hereunder, to eliminate or reduce
amounts payable pursuant to Section 2.13 or 2.15, as the case may be, in the
future; provided that any such action would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender in any respect deemed significant by it. The Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such action.

          (b) If any Lender requests compensation under Section 2.13, or if the
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.15,
or if any Lender defaults in its obligation to fund Loans hereunder, then the
Borrower may, at its sole expense and effort, upon notice to such Lender and the
Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in
Section 9.04), all its interests, rights and obligations under this Agreement to
an assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (i) the Borrower
shall have received the prior written consent of the Administrative Agent (and,
if a Commitment is being assigned, the Swingline Lender), which consent shall
not unreasonably be withheld, (ii) such Lender shall have received payment of an
amount equal to the outstanding principal of its Revolving Loans and Swingline
Loans, accrued interest thereon, accrued and unpaid fees and all other amounts
payable to it hereunder (including under Sections 2.13 and 2.15), from the
assignee (to the extent of such outstanding principal and accrued interest and
fees) or the Borrower (in the case of all other amounts) and (iii) in the case
of any such assignment resulting from a claim for compensation under Section
2.13 or payments required to be made pursuant to Section 2.15, such assignment
will result in a reduction in such compensation or payments. A Lender shall not
be required to make any such assignment and delegation if, prior thereto, as a
result of a waiver by such Lender or otherwise, the circumstances entitling the
Borrower to require such assignment and delegation cease to apply.

          (c) In making any claim under Section 2.13 or 2.15 or calculating any
amounts due thereunder, each Lender shall treat the Borrower no less favorably
than the treatment afforded by such Lender to similarly situated borrowers in
similar circumstances.

<PAGE>

                                   ARTICLE III

                         Representations and Warranties

          The Borrower represents and warrants to the Lenders that:

          SECTION 3.01. Organization; Powers. Each of the Borrower and its
Restricted Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization and has all requisite
power and authority to carry on its business as now conducted. Each of the
Borrower and its Restricted Subsidiaries is qualified to do business in, and is
in good standing in, every jurisdiction where such qualification is required,
except where the failure to be so qualified or in good standing, individually or
in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.

          SECTION 3.02. Authorization; Enforceability. The Transactions are
within the Borrower's corporate powers and have been duly authorized by all
necessary corporate and, if required, stockholder action. This Agreement has
been duly executed and delivered by the Borrower and constitutes a legal, valid
and binding obligation of the Borrower, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium
or other laws affecting creditors' rights generally and subject to general
principles of equity, regardless of whether considered in a proceeding in equity
or at law.

          SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions
(a) do not require any consent or approval of, registration or filing with, or
any other action by, any Governmental Authority, except such as have been
obtained or made and are in full force and effect, (b) will not violate any
applicable law or regulation or the charter, by-laws or other organizational
documents of the Borrower or any of its Restricted Subsidiaries or any order of
any Governmental Authority, (c) will not violate or result in a default under
any indenture or material agreement or other instrument binding upon the
Borrower or any of its Restricted Subsidiaries or its assets, or give rise to a
right thereunder to require any payment to be made by the Borrower or any of its
Restricted Subsidiaries, and (d) will not result in the creation or imposition
of any Lien on any asset of the Borrower or any of its Restricted Subsidiaries.

          SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The
Borrower has heretofore furnished to the Lenders the balance sheet and
statements of income, stockholders equity and cash flows of the Borrower and its
Restricted Subsidiaries on a consolidated basis (i) as of and for the fiscal
year ended March 31, 1996 reported on by Arthur Andersen LLP, independent public
accountants, and (ii) as of and for the fiscal quarter and the portion of the
fiscal year ended September 30, 1996, certified by its chief financial officer.
Such financial statements present fairly, in all material respects, the
financial condition and results of operations and cash flows of the Borrower and
its Restricted Subsidiaries on a consolidated basis as of such dates and for
such periods in accordance with GAAP, subject to year-end audit adjustments and
the absence of footnotes in the case of the statements referred to in clause
(ii) above.

<PAGE>

          (b) Since September 30, 1996, there has been no material adverse
change in the business, assets, operations, prospects or condition, financial or
otherwise, of the Borrower and its Restricted Subsidiaries, taken as a whole.

          SECTION 3.05. Properties. (a) Each of the Borrower and its Restricted
Subsidiaries has good title to, or valid leasehold interests in, all its real
and personal property material to its business, except for minor defects in
title that do not interfere with its ability to conduct its business as
currently conducted or to utilize such properties for their intended purposes.

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

          SECTION 3.06. Litigation and Environmental Matters. (a) There are no
actions, suits or proceedings by or before any arbitrator or Governmental
Authority pending against or, to the knowledge of the Borrower, threatened
against or affecting the Borrower or any of its Restricted Subsidiaries (i) that
could reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect (other than the Disclosed Matters) or (ii) that involve
this Agreement or the Transactions.

          (b) Except for the Disclosed Matters and except with respect to any
other matters that, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, neither the Borrower nor any of
its Restricted Subsidiaries (i) has failed to comply with any Environmental Law
or to obtain, maintain or comply with any permit, license or other approval
required under any Environmental Law, (ii) has become subject to any
Environmental Liability, (iii) has received notice of any claim with respect to
any Environmental Liability or (iv) knows of any basis for any Environmental
Liability.

          (c) Since the date of this Agreement, there has been no change in the
status of the Disclosed Matters that, individually or in the aggregate, has
resulted in, or materially increased the likelihood of, a Material Adverse
Effect.

          SECTION 3.07. Compliance with Laws and Agreements. Each of the
Borrower and its Restricted Subsidiaries is in compliance with all laws,
regulations and orders of any Governmental Authority applicable to it or its
property and all indentures, agreements and other instruments binding upon it or
its property, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect. No Default has occurred and is continuing.

          SECTION 3.08. Investment and Holding Company Status. Neither the
Borrower nor any of its Restricted Subsidiaries is (a) an "investment company"
as defined in, or subject to 

<PAGE>

regulation under, the Investment Company Act of 1940 (other than any Restricted
Subsidiary which is not subject to regulation under such statute as a result of
an exemption therefrom) or (b) a "holding company" as defined in, or subject to
regulation under, the Public Utility Holding Company Act of 1935.

          SECTION 3.09. Taxes. Each of the Borrower and its Restricted
Subsidiaries has timely filed or caused to be filed all Tax returns and reports
required to have been filed and has paid or caused to be paid all Taxes required
to have been paid by it, except (a) Taxes that are being contested in good faith
by appropriate proceedings and for which the Borrower or such Restricted
Subsidiary, as applicable, has set aside on its books adequate reserves in
accordance with GAAP or (b) to the extent that the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.

          SECTION 3.10. ERISA. No ERISA Event has occurred or is reasonably
expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, could reasonably be expected to
result in a Material Adverse Effect. The present value of all accumulated
benefit obligations under each Plan (based on the assumptions used for purposes
of Statement of Financial Accounting Standards No. 87) did not, as of the date
of the most recent financial statements reflecting such amounts, exceed by more
than $10,000,000 the fair market value of the assets of such Plan, and the
present value of all accumulated benefit obligations of all underfunded Plans
(based on the assumptions used for purposes of Statement of Financial Accounting
Standards No. 87) did not, as of the date of the most recent financial
statements reflecting such amounts, exceed by more than $10,000,000 the fair
market value of the assets of all such underfunded Plans.

          SECTION 3.11. Disclosure. The Borrower has disclosed to the Lenders
all agreements, instruments and corporate or other restrictions to which it or
any of its Restricted Subsidiaries is subject, and all other matters known to
it, that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect. None of the reports, financial statements,
certificates or other information furnished by or on behalf of the Borrower to
the Administrative Agent or any Lender in connection with the negotiation of
this Agreement or delivered hereunder (as modified or supplemented by other
information so furnished) contains any material misstatement of fact or omits to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading; provided that,
with respect to projected financial information, the Borrower represents only
that such information was prepared in good faith based upon assumptions believed
to be reasonable at the time; and provided further that with respect to
information about third parties the Borrower represents only that it has no
actual knowledge that such information is inaccurate or misleading.

          SECTION 3.12. Federal Reserve Regulations. (a) Neither the Borrower
nor any of the Restricted Subsidiaries is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying Margin Stock.

          (b) No part of the proceeds of any Loan will be used, whether directly
or indirectly, and whether immediately, incidentally or ultimately, (i) to
purchase or carry Margin 

<PAGE>

Stock or to extend credit to others for the purpose of purchasing or carrying
Margin Stock or to refund indebtedness originally incurred for such purpose, or
(ii) in any event, for any purpose which entails a violation of, or is
inconsistent with, the provisions of the Regulations of the Board, including
Regulation G, U or X.

                                   ARTICLE IV

                                   Conditions

          SECTION 4.01. Effective Date. The obligations of the Lenders to make
Loans hereunder shall not become effective until the date on which each of the
following conditions is satisfied (or waived in accordance with Section 9.02):

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

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

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

          (d) The Administrative Agent shall have received a certificate, dated
     the Effective Date and signed by the President, a Vice President or a
     Financial Officer of the Borrower, confirming compliance with the
     conditions set forth in paragraphs (a) and (b) of Section 4.02.

          (e) The Administrative Agent shall have received all fees and other
     amounts due and payable on or prior to the Effective Date, including, to
     the extent invoiced, reimbursement or payment of all out-of-pocket expenses
     required to be reimbursed or paid by the Borrower hereunder.

<PAGE>

          (f) The Administrative Agent and each Lender shall have received (i) a
     Borrowing Base Certificate prepared by the Borrower and reasonably
     satisfactory to the Administrative Agent and showing the Borrowing Base as
     of the close of business on November 30, 1996, and (ii) such other
     supporting documentation and additional reports with respect to the
     Borrowing Base as the Administrative Agent shall reasonably request in
     writing prior to the Closing Date.

The Administrative Agent shall notify the Borrower and the Lenders of the
Effective Date, and such notice shall be conclusive and binding. Notwithstanding
the foregoing, the obligations of the Lenders to make Loans hereunder shall not
become effective unless each of the foregoing conditions is satisfied (or waived
pursuant to Section 9.02) at or prior to 3:00 p.m., New York City time, on
January 31, 1997 (and, in the event such conditions are not so satisfied or
waived, the Commitments shall terminate at such time).

          SECTION 4.02. Each Credit Event. The obligation of each Lender to make
a Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:

          (a) The representations and warranties of the Borrower set forth in
     this Agreement shall be true and correct in all material respects on and as
     of the date of such Borrowing.

          (b) At the time of and immediately after giving effect to such
     Borrowing, no Default shall have occurred and be continuing.

Each Borrowing shall be deemed to constitute a representation and warranty by
the Borrower on the date thereof as to the matters specified in paragraphs (a)
and (b) of this Section.

                                    ARTICLE V

                              Affirmative Covenants

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

<PAGE>

          SECTION 5.01. Financial Statements and Other Information. The Borrower
will furnish to the Administrative Agent and each Lender:

          (a) within 90 days after the end of each fiscal year of the Borrower,
     (i) a copy of the audited consolidated balance sheet of the Borrower and
     its Restricted Subsidiaries on a consolidated basis and the related
     statements of operations, stockholders' equity and cash flows, as of the
     end of and for such year, setting forth in each case in comparative form
     the figures as of the end of and for the previous fiscal year, all reported
     on by Arthur Andersen LLP or other independent public accountants of
     recognized national standing (without a "going concern" or like
     qualification or exception and without any qualification or exception as to
     the scope of such audit) to the effect that such consolidated financial
     statements present fairly in all material respects the financial condition
     and results of operations of the Borrower and its Restricted Subsidiaries
     on a consolidated basis in accordance with GAAP consistently applied and
     (ii) a letter from such independent public accountants certifying that
     during the course of their audit nothing came to their attention that would
     indicate that the Borrowing Base Certificate, if any, relating to the last
     day of such fiscal year is inaccurate in any material respect;

          (b) within 60 days after the end of each of the first three fiscal
     quarters of each fiscal year of the Borrower, a copy of the unaudited
     consolidated balance sheet of the Borrower and its Restricted Subsidiaries
     on a consolidated basis and the related statements of operations,
     stockholders' equity and cash flows, as of the end of and for such fiscal
     quarter and the then elapsed portion of the fiscal year, setting forth in
     each case in comparative form the figures for the corresponding period or
     periods of (or, in the case of the balance sheet, as of the end of) the
     previous fiscal year, all certified by one of its Financial Officers as
     presenting fairly in all material respects the financial condition and
     results of operations of the Borrower and its Restricted Subsidiaries on a
     consolidated basis in accordance with GAAP consistently applied, subject to
     normal year-end audit adjustments and the absence of footnotes;

          (c) concurrently with any delivery of financial statements under
     clause (a) or (b) above, a certificate of a Financial Officer (i)
     certifying as to whether a Default has occurred and, if a Default has
     occurred, specifying the details thereof and any action taken or proposed
     to be taken with respect thereto; (ii) setting forth reasonably detailed
     calculations demonstrating compliance with Section 6.09; (iii) stating
     whether any change in GAAP or in the application thereof has occurred since
     the date of the audited financial statements referred to in Section 3.04
     and, if any such change has occurred, specifying the effect of such change
     on the financial statements accompanying such certificate; and (iv) setting
     forth the aggregate amount of all Warehouse Facilities and the aggregate
     portions thereof provided on a committed and on an uncommitted basis;

          (d) concurrently with any delivery of financial statements under
     clause (a) above, a certificate of the accounting firm that reported on
     such financial statements stating whether they obtained knowledge during
     the course of their examination of such financial 

<PAGE>

     statements of any Default (which certificate may be limited to the extent
     required by accounting rules or guidelines);

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

          (f) promptly following any request therefor, such other information
     regarding the operations, business affairs and financial condition of the
     Borrower or any Restricted Subsidiary, or compliance with the terms of this
     Agreement, as the Administrative Agent, on its own behalf or on behalf of
     any Lender, may reasonably request;

          (g) unless the Index Debt is Investment Grade, not later than 12:00
     noon, New York City time, on the fifteenth Business Day of each month, (i)
     a Borrowing Base Certificate showing the Borrowing Base as of the close of
     business on the last day of the immediately preceding month, each such
     certificate to be certified by a Financial Officer as complete and correct
     in all material respects and (ii) such other supporting documentation and
     additional reports with respect to the Borrowing Base as the Administrative
     Agent shall from time to time reasonably request; and

          (h) immediately upon (i) any revaluation, or any event that under GAAP
     would require a revaluation, in either case resulting from a change in
     assumptions, performance or valuation methodology or any other circumstance
     not arising in the ordinary course of the Borrower's business, of the
     Excess Spread Receivables on a aggregate basis on a balance sheet required
     to be delivered under clause (a) or (b) above, a certificate of a Financial
     Officer describing such revaluation and the reasons therefor and (ii)
     notice of any change of the rating of any Index Debt.

          SECTION 5.02. Notices of Material Events. The Borrower will furnish to
the Administrative Agent and each Lender prompt written notice of the following:

          (a) the occurrence of any Default;

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

          (c) the occurrence of any ERISA Event that, alone or together with any
     other ERISA Events that have occurred, could reasonably be expected to
     result in liability of the Borrower and its Restricted Subsidiaries in an
     aggregate amount exceeding $5,000,000; and

<PAGE>

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

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

          SECTION 5.03. Existence; Conduct of Business. The Borrower will, and
will cause each of its Restricted Subsidiaries to, do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal
existence and the rights, licenses, permits, privileges and franchises material
to the conduct of its business; provided that the foregoing shall not prohibit
(a) any merger, consolidation, liquidation or dissolution permitted under
Section 6.03 or (b) any Asset Disposition permitted under Section 6.04.

          SECTION 5.04. Payment of Obligations. The Borrower will, and will
cause each of its Restricted Subsidiaries to, pay its obligations, including Tax
liabilities, that, if not paid, could reasonably be expected to result in a
Material Adverse Effect before the same shall become delinquent or in default,
except where (a) the validity or amount thereof is being contested in good faith
by appropriate proceedings, (b) the Borrower or such Restricted Subsidiary has
set aside on its books adequate reserves with respect thereto in accordance with
GAAP and (c) the failure to make payment pending such contest could not
reasonably be expected to result in a Material Adverse Effect.

          SECTION 5.05. Maintenance of Properties; Insurance. The Borrower will,
and will cause each of its Restricted Subsidiaries to, (a) keep and maintain all
property material to the conduct of its business in good working order and
condition, ordinary wear and tear excepted, and (b) maintain, with financially
sound and reputable insurance companies, insurance in such amounts and against
such risks as are customarily maintained by companies engaged in the same or
similar businesses operating in the same or similar locations.

          SECTION 5.06. Books and Records; Inspection and Audit Rights. (a) The
Borrower will, and will cause each of its Restricted Subsidiaries to, keep
proper books of record and account in which full, true and correct entries are
made of all dealings and transactions in relation to its business and
activities. The Borrower will, and will cause each of its Restricted
Subsidiaries to, permit any representatives designated by the Administrative
Agent or any Lender, upon reasonable prior notice, to visit and inspect its
properties, to examine and make extracts from its books and records, and to
discuss its affairs, finances and condition with officers of the Borrower and
its independent accountants, all at such reasonable times and as often as
reasonably requested; provided that any such discussions with such independent
accountants pursuant to this paragraph shall be held no more than once in any
fiscal year unless (and shall be at the sole cost and expense of the Borrower
if) a Default shall have occurred and be continuing. If the Borrower so elects,
on any visit or inspection or during any discussion pursuant to this Section,
such designated representatives shall be accompanied by one or more
representatives of the Borrower.

<PAGE>

          (b) At any time upon the request of the Administrative Agent made with
reasonable prior notice, the Borrower will permit the Administrative Agent or
professionals (including investment bankers, consultants, accountants, lawyers
and appraisers) retained by the Administrative Agent to conduct evaluations and
appraisals of (i) the Borrower's practices in the computation of the Borrowing
Base and (ii) the assets included in the Borrowing Base, and will pay the
reasonable fees and expenses in connection therewith; provided that such persons
shall be entitled to conduct such evaluations and appraisals only if (x) a
Default has occurred and is continuing or (y) the Administrative Agent, or the
Required Lenders through the Administrative Agent, determines that a Material
Adverse Effect has occurred since the Effective Date.

          SECTION 5.07. Compliance with Laws. The Borrower will, and will cause
each of its Restricted Subsidiaries to, comply with all laws, rules, regulations
and orders of any Governmental Authority applicable to it or its property,
except where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

          SECTION 5.08. Use of Proceeds. The proceeds of the Loans will be used
only for general corporate and liquidity purposes. No part of the proceeds of
any Loan will be used, whether directly or indirectly, for any purpose that
entails a violation of any of the Regulations of the Board, including
Regulations G, U and X.

                                   ARTICLE VI

                               Negative Covenants

          Until the Commitments have expired or terminated and the principal of
and interest on each Loan and all fees payable hereunder have been paid in full,
the Borrower covenants and agrees with the Lenders that:

          SECTION 6.01. Limitation on Indebtedness and Preferred Stock of
Restricted Subsidiaries. The Borrower will not permit any Restricted Subsidiary
to Incur, or permit to exist with respect to any Restricted Subsidiary, directly
or indirectly, any Indebtedness or Preferred Stock except:

          (a) Permitted Warehouse Indebtedness;

          (b) Indebtedness or Preferred Stock issued to and held by the Borrower
     or a Wholly Owned Subsidiary; provided, however, that any subsequent
     issuance or transfer of any Capital Stock which results in any such Wholly
     Owned Subsidiary ceasing to be a Wholly Owned Subsidiary or any subsequent
     transfer of such Indebtedness or Preferred Stock (other than to the
     Borrower or a Wholly Owned Subsidiary) shall be deemed, in each case, to
     constitute the issuance of Indebtedness or Preferred Stock by the issuer
     thereof;

<PAGE>

          (c) Indebtedness or Preferred Stock of a Subsidiary Incurred and
     outstanding on or prior to the date on which such Subsidiary was acquired
     by the Borrower (other than Indebtedness or Preferred Stock Incurred in
     connection with, or to provide all or any portion of the funds or credit
     support utilized to consummate, the transaction or series of related
     transactions pursuant to which such Subsidiary became a Subsidiary or was
     acquired by the Borrower);

          (d) Indebtedness or Preferred Stock outstanding on the date hereof and
     set forth in Schedule 6.01 (other than Indebtedness described in clause
     (a), (b) or (c) of this Section); and

          (e) Refinancing Indebtedness Incurred in respect of Indebtedness or
     Preferred Stock referred to in clause (c) or (d) of this Section or this
     clause (e); provided, however, that to the extent such Refinancing
     Indebtedness directly or indirectly Refinances Indebtedness or Preferred
     Stock of a Subsidiary described in clause (c) of this Section, such
     Refinancing Indebtedness shall be Incurred only by such Subsidiary.

          SECTION 6.02. Limitation on Liens. The Borrower will not, and will not
permit any Subsidiary to, Incur or permit to exist any Lien on any of its
properties (including Capital Stock of a Restricted Subsidiary), whether owned
on the date hereof or thereafter acquired, or on any income or revenues or
rights in respect of any thereof, or assign or transfer any income or revenues
or rights in respect thereof except:

          (a) pledges or deposits by such Person under worker's compensation
     laws, unemployment insurance laws or similar legislation, or good faith
     deposits in connection with bids, tenders, contracts (other than for the
     payment of Indebtedness) or leases to which such Person is a party, or
     deposits to secure public or statutory obligations of such Person or
     deposits of cash or United States government bonds to secure surety or
     appeal bonds to which such Person is a party, or deposits as security for
     contested taxes or import duties or for the payment of rent, in each case
     Incurred in the ordinary course of business;

          (b) Liens imposed by law, such as carriers', warehousemen's and
     mechanics' Liens, in each case for sums not yet due or being contested in
     good faith by appropriate proceedings or other Liens arising out of
     judgments or awards against such Person with respect to which such Person
     shall then be proceeding with an appeal or other proceedings for review;

          (c) Liens for property taxes not yet subject to penalties for
     non-payment or which are being contested in good faith and by appropriate
     proceedings;

          (d) Liens in favor of issuers of surety bonds or letters of credit
     issued pursuant to the request of and for the account of such Person in the
     ordinary course of its business; provided, however, that such letters of
     credit do not constitute Indebtedness;

<PAGE>

          (e) minor survey exceptions, minor encumbrances, easements or
     reservations of, or rights of others for, licenses, rights of way, sewers,
     electric lines, telegraph and telephone lines and other similar purposes,
     or zoning or other restrictions as to the use of real property or Liens
     incidental to the conduct of the business of such Person or to the
     ownership of its properties which were not Incurred in connection with
     Indebtedness and which do not in the aggregate materially adversely affect
     the value of said properties or materially impair their use in the
     operation of the business of such Person;

          (f) Liens securing Indebtedness Incurred to finance the construction,
     purchase or lease of, or repairs, improvements or additions to, property,
     plant or equipment of such Person (and in any event excluding Capital Stock
     of another Person); provided, however, that the Lien may not extend to any
     other asset owned by such Person or any of its Subsidiaries at the time the
     Lien is Incurred, and the Indebtedness secured by the Lien may not be
     Incurred more than 180 days after the later of the acquisition, completion
     of construction, repair, improvement, addition or commencement of full
     operation of the property subject to the Lien;

          (g) Liens on Performance Deposits and any Receivables or other assets
     referred to in clause (ii)(A) of the definition of Permitted Warehouse
     Indebtedness, in each case owned by the Borrower or a Restricted
     Subsidiary, as the case may be, to secure Permitted Warehouse Indebtedness;

          (h) Liens on Excess Spread Receivables (or on the Capital Stock of any
     Subsidiary of such Person substantially all the assets of which are Excess
     Spread Receivables); provided, however, that (I)(A) any such Liens shall
     not pertain to any Excess Spread Receivable existing on the date hereof,
     which, if created thereafter, would have been an Eligible Excess Spread
     Receivable unless such Excess Spread Receivable was subject to a Lien on
     such date created by the Borrower in respect of the financing thereof (a
     "predecessor Lien"); provided further, however, that in the case of any
     such Liens (a "subsequent Lien") on Excess Spread Receivables which were
     subject to predecessor Liens, the sum of (1) the aggregate book value of
     subordinated interests created and retained by the Borrower or its
     Restricted Subsidiaries as a result of the sale or financing associated
     with such subsequent Liens and (2) the aggregate book value of any Excess
     Spread Receivables which were subject to predecessor Liens but which are
     then no longer subject to any Lien (other than permitted Liens described
     under another clause of this Section) shall equal at least the aggregate
     book value at such time of all such Excess Spread Receivables which are
     then subject to subsequent Liens, as calculated immediately prior to the
     creation of each such subsequent Lien, multiplied by a fraction the
     numerator of which is the aggregate book value of the subordinated
     interests associated with all predecessor Liens on the date hereof, and the
     denominator of which is the sum of (1) such aggregate book value of such
     subordinated interests and (2) the outstanding balance on the date hereof,
     of the related senior interests; and (B) any such Lien on any Eligible
     Excess Spread Receivables shall extend to Eligible Excess Spread
     Receivables representing no more than 50% of the amount of Eligible Excess
     Spread Receivables shown on the balance sheet of the Borrower and its
     Restricted Subsidiaries on a 

<PAGE>

     consolidated basis, determined and consolidated in accordance with GAAP, as
     of the later of (x) the date hereof and (y) the end of the most recent
     fiscal quarter of the Borrower prior to the creation of such Lien for which
     financial statements are available; and (II) for purposes of this clause
     (h), any Lien on the Capital Stock of any Person substantially all the
     assets of which are Excess Spread Receivables shall be treated as a Lien on
     the Excess Spread Receivables of such Person;

          (i) Liens existing on the date hereof and listed on Schedule 6.02;

          (j) Liens on property or shares of Capital Stock of another Person at
     the time such other Person becomes a Subsidiary of such Person; provided,
     however, that such Liens are not created, incurred or assumed in connection
     with, or in contemplation of, such other Person becoming such a Subsidiary;
     provided further, however, that such Lien may not extend to any other
     property owned by such Person or any of its Subsidiaries;

          (k) Liens on property at the time such Person or any of its
     Subsidiaries acquires the property, including any acquisition by means of a
     merger or consolidation with or into such Person or a Subsidiary of such
     Person; provided, however, that such Liens are not created, incurred or
     assumed in connection with, or in contemplation of, such acquisition;
     provided further, however, that the Liens may not extend to any other
     property owned by such Person or any of its Subsidiaries;

          (l) Liens securing Indebtedness or other obligations of a Subsidiary
     of such Person owing to such Person or a Restricted Subsidiary of such
     Person;

          (m) Liens (other than on any Excess Spread Receivables) securing
     Hedging Agreements; and

          (n) Liens to secure any Refinancing (or successive Refinancings) as a
     whole, or in part, of any Indebtedness secured by any Lien referred to in
     the foregoing clauses (f), (i), (j) and (k); provided, however, that (x)
     such new Lien shall be limited to all or part of the same property that
     secured the original Indebtedness (plus improvements to or on such
     property) and (y) the Indebtedness secured by such Lien at such time is not
     increased to any amount greater than the sum of (A) the outstanding
     principal amount or, if greater, committed amount of the Indebtedness
     described under the foregoing clauses (f), (i), (j) or (k), as the case may
     be, at the time the original Lien became a Lien permitted by this Section
     and (B) an amount necessary to pay any fees and expenses, including
     premiums, related to such refinancing, refunding, extension, renewal or
     replacement.

          Notwithstanding the foregoing, clauses (f), (j) or (k) above will be
deemed to exclude any Lien to the extent such Lien applies to any Additional
Assets acquired directly or indirectly with Net Available Cash pursuant to
Section 6.04.

<PAGE>

          SECTION 6.03. Limitation on Mergers and Consolidations. The Borrower
will not consolidate with or merge with or into, or convey, transfer or lease,
in one transaction or a series of related transactions, all or substantially all
its assets to, any Person, unless:

          (a) the Borrower shall be the surviving Person of any such
     transaction;

          (b) immediately after giving effect to such transaction, no Default
     shall have occurred and be continuing;

          (c) immediately after giving effect to such transaction, the Successor
     Company shall have Consolidated Net Worth in an amount which is not less
     than Consolidated Net Worth immediately prior to such transaction; and

          (d) the Borrower shall have delivered to the Administrative Agent a
     certificate, signed by two executive officers, and an opinion of counsel,
     each stating that such consolidation, merger or transfer comply with this
     Agreement.

          Notwithstanding the foregoing clauses (b) and (c), any Restricted
Subsidiary may consolidate with, merge into or transfer all or part of its
properties and assets to the Borrower or a Wholly Owned Subsidiary.

          SECTION 6.04. Limitation on Sales of Assets and Subsidiary Stock. The
Borrower will not, and will not permit any Restricted Subsidiary to, directly or
indirectly, consummate any sale, lease, transfer or other disposition (or series
of related sales, leases, transfers or dispositions) by the Borrower or any
Restricted Subsidiary, including any disposition by means of a merger,
consolidation or similar transaction (each referred to for the purposes of this
definition as an "Asset Disposition"), of:

          (a) any shares of Capital Stock of a Restricted Subsidiary (other than
     directors' qualifying shares or shares required by applicable law to be
     held by a Person other than the Borrower or a Restricted Subsidiary);

          (b) all or substantially all the assets of any division or line of
     business of the Borrower or any Restricted Subsidiary;

          (c) any other assets of the Borrower or any Restricted Subsidiary
     outside of the ordinary course of business of the Borrower or such
     Restricted Subsidiary;

          (d) any Investment in a Strategic Alliance Client; or

          (e) any Excess Spread Receivables;

other than, in the case of (a), (b), (c), (d) and (e) above, (x) an Asset
Disposition by a Restricted Subsidiary to the Borrower or by the Borrower or a
Restricted Subsidiary to a Restricted Subsidiary or (y) an Asset Disposition
(including related assets) for an aggregate consideration of 

<PAGE>

$1,000,000 or less, unless (i) the Borrower or such Restricted Subsidiary
receives consideration at the time of such Asset Disposition at least equal to
the fair market value (including the value of all non-cash consideration), as
determined in good faith by the Board of Directors, of the shares and assets
subject to such Asset Disposition and at least 85% of the consideration therefor
received by the Borrower or such Restricted Subsidiary is in the form of cash or
cash equivalents and (ii) an amount equal to 100% of the Net Available Cash from
such Asset Disposition is applied by the Borrower (or such Restricted
Subsidiary, as the case may be) (A) to the extent the Borrower elects, to
acquire Additional Assets, either directly or through a Restricted Subsidiary,
within 180 days from the later of the date of such Asset Disposition or the
receipt of such Net Available Cash, and (B) to the extent of the balance of such
Net Available Cash after application in accordance with clause (A), to
permanently reduce the Commitments in accordance with Section 2.07 and to make
any prepayments required by such Section in connection with such reduction.

          Notwithstanding the foregoing provisions of this Section, the Borrower
and the Restricted Subsidiaries shall not be required to apply any Net Available
Cash in accordance with this Section except to the extent that the aggregate Net
Available Cash from all Asset Dispositions which has not been applied in
accordance with this paragraph exceeds $10,000,000. Pending application of Net
Available Cash pursuant to this Section, such Net Available Cash shall be
applied (i) to prepay outstanding Loans and (ii) to the extent of the excess of
Net Available Cash over the principal amount of outstanding Loans, in Permitted
Investments.

          SECTION 6.05. Limitation on Loans and Investments. (a) The Borrower
will not, and will not permit any of its Restricted Subsidiaries to, purchase,
hold or acquire (including pursuant to any merger with any Person that was not a
Wholly Owned Subsidiary prior to such merger) any Capital Stock, evidences of
indebtedness or other securities (including any option, warrant or other right
to acquire any of the foregoing) of, make or permit to exist any loans or
advances to, Guarantee any obligations of, or make or permit to exist any
investment or any other interest in, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person constituting a business unit, except:

          (i) Permitted Investments;

          (ii) Investments by the Borrower or any Restricted Subsidiary in a
     Restricted Subsidiary or a Person that will, upon the making of such
     Investment, become a Restricted Subsidiary; provided, however, that the
     primary business of such Restricted Subsidiary is a Related Business;

          (iii) a Strategic Alliance Client to the extent such Investment
     consists of options, warrants or other securities that are convertible or
     exchangeable for equity securities of such Strategic Alliance Client and is
     received by the Borrower or a Restricted Subsidiary without the payment of
     any consideration other than the concurrent provision by the Borrower or
     such Restricted Subsidiary to such Strategic Alliance Client of financing
     or asset securitization expertise on terms determined by the Borrower to be
     fair and reasonable to the Borrower or such Restricted Subsidiary from a
     financial point of view 

<PAGE>

     without taking into consideration any value that may inhere in such option,
     warrant or convertible or exchangeable security;

          (iv) another Person if as a result of such Investment such other
     Person is merged or consolidated with or into, or transfers or conveys all
     or substantially all its assets to, the Borrower or a Restricted
     Subsidiary; provided, however, that such Person's primary business is a
     Related Business;

          (v) receivables owing to the Borrower or any Restricted Subsidiary if
     created or acquired in the ordinary course of business and payable or
     dischargeable in accordance with customary trade terms; (vi) payroll,
     travel and similar advances to cover matters that are expected at the time
     of such advances ultimately to be treated as expenses for accounting
     purposes and that are made in the ordinary course of business; (vii) loans
     or advances to employees in the ordinary course of business in accordance
     with the past practices of the Borrower or such Restricted Subsidiary, but
     in any event not to exceed $10,000,000 in aggregate principal amount
     outstanding at any one time;

          (viii) stock, obligations or securities received in settlement of
     debts created in the ordinary course of business and owing to the Borrower
     or any Restricted Subsidiary or in satisfaction of judgments;

          (ix) any Person to the extent such Investment represents the non-cash
     portion of the consideration received for an Asset Disposition;

          (x) Receivables;

          (xi) a Strategic Alliance Client to the extent such Investment
     consists of (A) Indebtedness of such Strategic Alliance Client that is
     secured by Receivables owned by such Strategic Alliance Client in an
     aggregate principal amount at any time outstanding not to exceed the
     aggregate market value of such Receivables; provided, however, that such
     Receivables are eligible to be characterized under GAAP as held for sale on
     the balance sheet of such Strategic Alliance Client and such Indebtedness
     has not been outstanding in excess of 364 days; and (B) Indebtedness of
     such Strategic Alliance Client that is secured by Excess Spread Receivables
     owned by such Strategic Alliance Client; provided, however, that such
     Excess Spread Receivables are attributed solely to one or more "pools" of
     Receivables that were securitized in one or more transactions in which the
     Borrower or its Restricted Subsidiaries either acted as underwriters or
     placement agent or provided all or a portion of the financing for such
     "pool" prior to such securitization; and

          (xii) Excess Spread Receivables; provided, however, that such Excess
     Spread Receivables represent interests in one or more "pools" of
     Receivables that were securitized in one or more transactions in which the
     Borrower or its Restricted Subsidiaries acted as 

<PAGE>

     sponsor, underwriter or placement agent or provided all or a portion of the
     financing for such "pool" prior to such securitization.

          (b) The Borrower will not, and will not permit any of its Restricted
Subsidiaries to, enter into any Hedging Agreement, other than Hedging Agreements
entered into in the ordinary course of business to hedge or mitigate risks to
which the Borrower or any Restricted Subsidiary or any Strategic Alliance Client
is exposed in the conduct of its business or the management of its liabilities;
provided that, in the case of Hedging Agreements relating to a Strategic
Alliance Client, (i) such Hedging Agreements are not for speculative purposes of
the Borrower or any Restricted Subsidiary and (ii) such Strategic Alliance
Client is contractually obligated to make the Borrower or such Restricted
Subsidiary whole for any loss suffered thereby in connection therewith.

          SECTION 6.06. Limitation on Affiliate Transactions. (a) The Borrower
will not, and will not permit any of its Restricted Subsidiaries to, sell, lease
or otherwise transfer any property or assets to, or purchase, lease or otherwise
acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates (an "Affiliate Transaction") unless the
terms thereof (i) are no less favorable to the Borrower or such Restricted
Subsidiary than those that could be obtained at the time of such transaction in
arm's-length dealings with a Person who is not such an Affiliate, (ii) if such
Affiliate Transaction involves an amount in excess of $2,000,000 (or the
equivalent amount in any foreign currency) (x) are set forth in writing and (y)
have been approved by a majority of the members of the Board of Directors having
no personal stake in such Affiliate Transaction and (iii) if such Affiliate
Transaction involves an amount in excess of $10,000,000 (or the equivalent
amount in any foreign currency), have been determined by a nationally recognized
investment banking firm to be fair, from a financial standpoint, to the Borrower
and its Restricted Subsidiaries.

          (b) The provisions of Section 6.06(a) shall not prohibit (i) any
Permitted Investment, (ii) any issuance of securities, or other payments, awards
or grants in cash, securities or otherwise pursuant to, or the funding of,
employment arrangements, stock options and stock ownership plans approved by the
Board of Directors, (iii) the grant of stock options or similar rights to
employees and directors of the Borrower pursuant to plans approved by the Board
of Directors, (iv) loans or advances to employees in the ordinary course of
business in accordance with the past practices of the Borrower or its Restricted
Subsidiaries, but in any event not to exceed $10,000,000 (or the equivalent
amount in any foreign currency) in aggregate principal amount outstanding at any
one time, (v) the payment of reasonable fees to directors of the Borrower and
its Restricted Subsidiaries who are not employees of the Borrower or its
Restricted Subsidiaries, (vi) any Affiliate Transaction between the Borrower and
a Restricted Subsidiary or between consolidated Restricted Subsidiaries (in each
case other than any Restricted Subsidiary that is an "affiliate" (as such term
is defined in the Exchange Act) of any Affiliate (other than any Restricted
Subsidiary) of the Borrower and (vii) transactions pursuant to any agreement as
in existence as of the date hereof and set forth in Schedule 6.06 between the
Borrower or its Restricted Subsidiaries and Continental Grain or one of its
subsidiaries.

          SECTION 6.07. Limitation on Restrictions on Distributions from
Restricted Subsidiaries. The Borrower will not, and will not permit any
Restricted Subsidiary to, directly or 

<PAGE>

indirectly, enter into, incur or permit to exist any agreement or other
arrangement that prohibits, restricts or imposes any condition upon (a) the
ability of the Borrower or any Restricted Subsidiary to create, incur or permit
to exist any Lien upon any of its property or assets or (b) the ability of any
Restricted Subsidiary to pay dividends or make any other distributions on its
Capital Stock to the Borrower or a Restricted Subsidiary or pay any Indebtedness
owed to the Borrower, to make any loans or advances to the Borrower or a
Restricted Subsidiary or to Guarantee Indebtedness of or to transfer any of its
property or assets to the Borrower or any other Restricted Subsidiary that owns
Capital Stock therein; provided that the foregoing shall not apply to (i)
restrictions and conditions imposed by law or by this Agreement; (ii) any
encumbrance or restriction pursuant to an agreement in effect at or entered into
on the date hereof identified on Schedule 6.07 (but shall apply to any extension
or renewal of, or any amendment or modification expanding the scope of, any such
restriction or condition); (iii) any encumbrance or restriction with respect to
a Restricted Subsidiary pursuant to an agreement applicable to such Restricted
Subsidiary on or prior to the date on which such Restricted Subsidiary was
acquired by the Borrower (other than an agreement entered into in connection
with, or in anticipation of, the transaction or series of related transactions
pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or
was acquired by the Borrower) and outstanding on such date; (iv) any such
encumbrance or restriction consisting of customary non-assignment provisions in
leases governing leasehold interests to the extent such provisions restrict the
transfer of the lease or the property leased thereunder; (v) in the case of a
Restricted Subsidiary transferring any of its property or assets to the
Borrower, restrictions contained in security agreements or mortgages securing
Indebtedness of a Restricted Subsidiary to the extent such restrictions restrict
the transfer of the property subject to such security agreements or mortgages;
and (vi) any restriction with respect to a Restricted Subsidiary imposed
pursuant to an agreement entered into for the sale or disposition of all or
substantially all the Capital Stock or assets of such Restricted Subsidiary
pending the closing of such sale or disposition; provided further that clause
(a) of the foregoing shall not apply to restrictions or conditions imposed by
any agreement relating to secured Indebtedness permitted by this Agreement if
such restrictions or conditions apply only to the property or assets securing
such Indebtedness.

          SECTION 6.08. Limitation on Investment Company Status. The Borrower
will not take any action, or otherwise permit to exist any circumstance, that
would require the Borrower to register as an "investment company" under the
Investment Company Act of 1940.

          SECTION 6.09. Financial Covenants. (a) Consolidated Net Worth shall
not at any time be less than (i) $325,000,000 plus (ii) an amount equal to 75%
of the aggregate of positive Consolidated Net Income (without deduction for
quarterly losses) for each fiscal quarter which begins after September 30, 1996,
and ends prior to the date for which compliance with this Section is being
determined.

          (b) The Consolidated Leverage Ratio will not at any time exceed 2.50
to 1.00.

          (c) The Consolidated Interest Coverage Ratio for the Rolling Period
shall at no time be less than 1.50 to 1.00.

<PAGE>

          SECTION 6.10. Limitation on Business of the Borrower. The Borrower
will not engage at any time in any business or business activity other than the
business currently conducted by it and Related Business.

                                   ARTICLE VII

                                Events of Default

          If any of the following events ("Events of Default") shall occur:

          (a) the Borrower shall fail to pay any principal of any Loan when and
     as the same shall become due and payable, whether at the due date thereof
     or at a date fixed for prepayment thereof or otherwise;

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

          (c) any representation or warranty made or deemed made by or on behalf
     of the Borrower or any Restricted Subsidiary in or in connection with this
     Agreement or any amendment or modification hereof or waiver hereunder, or
     in any report, certificate, financial statement or other document furnished
     pursuant to or in connection with this Agreement or any amendment or
     modification hereof or waiver hereunder, shall prove to have been
     materially incorrect when made or deemed made;

          (d) the Borrower shall fail to observe or perform any covenant,
     condition or agreement contained in Section 5.02, 5.03 (with respect to the
     Borrower's existence) or 5.08 or in Article VI;

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

          (f) the Borrower or any Restricted Subsidiary shall fail to make any
     payment (whether of principal or interest and regardless of amount) in
     respect of any Material Indebtedness, when and as the same shall become due
     and payable;

          (g) any event or condition occurs that results in any Material
     Indebtedness becoming due prior to its scheduled maturity or that enables
     or permits (with or without the giving of notice, the lapse of time or
     both) the holder or holders of any Material Indebtedness or any trustee or
     agent on its or their behalf to cause any Material Indebtedness to become
     due, or to require the prepayment, repurchase, redemption or 

<PAGE>

     defeasance thereof, prior to its scheduled maturity; provided that this
     clause (g) shall not apply to secured Indebtedness that becomes due as a
     result of the permitted voluntary sale or transfer of the property or
     assets securing such Indebtedness;

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

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

          (j) the Borrower or any Restricted Subsidiary shall become unable,
     admit in writing or fail generally to pay its debts as they become due;

          (k) one or more judgments for the payment of money in an aggregate
     amount not covered by insurance in excess of $5,000,000 (or the equivalent
     amount in any foreign currency) shall be rendered against the Borrower, any
     Restricted Subsidiary or any combination thereof and the same shall remain
     undischarged for a period of 60 consecutive days during which execution
     shall not be effectively stayed, or any action shall be legally taken by a
     judgment creditor to attach or levy upon any assets of the Borrower or any
     Restricted Subsidiary to enforce any such judgment;

          (l) an ERISA Event shall have occurred that, in the opinion of the
     Required Lenders, when taken together with all other ERISA Events that have
     occurred, could reasonably be expected to result in liability of the
     Borrower and its Restricted Subsidiaries in an aggregate amount exceeding
     (i) $5,000,000 for any fiscal year of the Borrower or (ii) $10,000,000 for
     all periods; or

          (m) a Change in Control shall occur;

<PAGE>

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

                                  ARTICLE VIII

                            The Administrative Agent

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

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

          The Administrative Agent shall not have any duties or obligations
except those expressly set forth herein. Without limiting the generality of the
foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or
other implied duties, regardless of whether a Default has occurred and is
continuing, (b) the Administrative Agent shall not have any duty to take any
discretionary action or exercise any discretionary powers, except discretionary
rights and powers expressly contemplated hereby that the Administrative Agent is
required to exercise in writing by the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 9.02), and (c) except as expressly set forth herein, the
Administrative Agent shall not have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any of its Restricted Subsidiaries that is communicated to or obtained by the
bank serving as Administrative Agent or any of its Affiliates 

<PAGE>

in any capacity. The Administrative Agent shall not be liable for any action
taken or not taken by it with the consent or at the request of the Required
Lenders (or such other number or percentage of the Lenders as shall be necessary
under the circumstances as provided in Section 9.02) or in the absence of its
own gross negligence or wilful misconduct. The Administrative Agent shall be
deemed not to have knowledge of any Default unless and until written notice
thereof is given to the Administrative Agent by the Borrower or a Lender, and
the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with this Agreement, (ii) the contents of any certificate,
report or other document delivered hereunder or in connection herewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth herein, (iv) the validity, enforceability, effectiveness
or genuineness of this Agreement or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article IV or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.

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

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

          Subject to the appointment and acceptance of a successor
Administrative Agent as provided in this paragraph, the Administrative Agent may
resign at any time by notifying the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right, in consultation with the
Borrower, to appoint a successor. If no successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within 30 days
after the retiring Administrative Agent gives notice of its resignation, then
the retiring Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent which shall be a bank. Upon the acceptance of its
appointment as Administrative Agent hereunder by a successor, such successor
shall succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be 

<PAGE>

discharged from its duties and obligations hereunder. The fees payable by the
Borrower to a successor Administrative Agent shall be the same as those payable
to its predecessor unless otherwise agreed between the Borrower and such
successor. After the Administrative Agent's resignation hereunder, the
provisions of this Article and Section 9.03 shall continue in effect for the
benefit of such retiring Administrative Agent, its sub-agents and their
respective Related Parties in respect of any actions taken or omitted to be
taken by any of them while it was acting as Administrative Agent.

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

                                   ARTICLE IX

                                  Miscellaneous

          SECTION 9.01. Notices. Except in the case of notices and other
communications expressly permitted to be given by telephone, all notices and
other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by telecopy, as follows:

          (a) if to the Borrower, to it at ContiFinancial Corporation, 277 Park
     Avenue, New York, New York 10172, Attention of Chief Counsel and of
     Director of Corporate Finance (Telecopy No. (212) 207-2935);

          (b) if to the Administrative Agent, to Credit Suisse First Boston,
     Eleven Madison Avenue (Telecopy No. (212) 325-8228), Attention of Diane
     Albanese;

          (c) if to the Swingline Lender, to it at Dresdner Bank AG, New York
     and Grand Cayman Branches, 75 Wall Street, Attention of Claudia Zoy
     (Telecopy No. (212) 429-2130); and

          (d) if to any other Lender, to it at its address (or telecopy number)
     set forth in its Administrative Questionnaire.

Any party hereto may change its address or telecopy number for notices and other
communications hereunder by notice to the other parties hereto. All notices and
other 

<PAGE>

communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given on the date of receipt.

          SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan shall not
be construed as a waiver of any Default, regardless of whether the
Administrative Agent or any Lender may have had notice or knowledge of such
Default at the time.

          (b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; provided that no
such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce or forgive the principal amount of
any Loan or reduce the rate of interest thereon, or reduce any fees payable
hereunder, without the written consent of each Lender, (iii) postpone the
scheduled date of payment of the principal amount of any Loan or any interest
thereon, or any fees payable hereunder, or amend the definition of "Maturity
Date", or reduce the amount of, waive or excuse any such payment, or postpone
the scheduled date of expiration of any Commitment, without the written consent
of each Lender affected thereby, (iv) change Section 2.16(b) or (c) in a manner
that would alter the pro rata sharing of payments required thereby, without the
written consent of each Lender, or (v) change any of the provisions of this
Section or the definition of "Required Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to waive, amend or
modify any rights hereunder or make any determination or grant any consent
hereunder, without the written consent of each Lender; provided further that no
such agreement shall (i) increase any advance rate used in calculating the
Borrowing Base or otherwise change the computation of the Borrowing Base or the
definition of any constituent component of the Borrowing Base, without the prior
written consent of Lenders representing 80% of the aggregate Commitments or (ii)
amend, modify or otherwise affect the rights or duties of the Administrative
Agent or the Swingline Lender hereunder without the prior written consent of the
Administrative Agent or the Swingline Lender, as the case may be.

          SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Borrower
shall pay (i) all reasonable out-of-pocket expenses incurred by the
Administrative Agent and its Affiliates and the Swingline Lender and its
Affiliates, including the reasonable fees, charges and disbursements of counsel
for the Administrative Agent and the Swingline Lender, in connection with the
syndication of the credit facilities provided for herein, the preparation and
administration 

<PAGE>

of this Agreement or any amendments, modifications or waivers of the provisions
hereof (whether or not the transactions contemplated hereby or thereby shall be
consummated) and (ii) all reasonable out-of-pocket expenses incurred by the
Administrative Agent or any Lender, including the fees, charges and
disbursements of any counsel for the Administrative Agent or any Lender, in
connection with the enforcement or protection of its rights in connection with
this Agreement, including its rights under this Section, or in connection with
the Loans made hereunder, including all such reasonable out-of-pocket expenses
incurred during any workout, restructuring or negotiations in respect of such
Loans.

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

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

          (d) To the extent permitted by applicable law, no party shall assert,
and each party hereby waives, any claim against any Indemnitee, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement or any agreement or instrument contemplated hereby, the
Transactions, any Loan or the use of the proceeds thereof; provided that this
Section 9.03(d) shall in no way limit the rights of any Lender under Section
2.13, 2.14 or 2.15.

          (e) All amounts due under this Section shall be payable not later than
10 days after written demand therefor.

<PAGE>

          SECTION 9.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void). Nothing in this Agreement, expressed or implied, shall be construed to
confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, the Related Parties of each of the Administrative Agent and
the Lenders) any legal or equitable right, remedy or claim under or by reason of
this Agreement.

          (b) Any Lender may assign to one or more assignees all or a portion of
its rights and obligations under this Agreement (including all or a portion of
its Commitment and the Loans at the time owing to it); provided that (i) except
in the case of an assignment to a Lender or an Affiliate of a Lender, each of
the Borrower and the Administrative Agent (and, in the case of an assignment of
all or a portion of a Commitment or any Lender's obligations in respect of its
Swingline Exposure, the Swingline Lender) must give their prior written consent
to such assignment (which consent shall not be unreasonably withheld), (ii)
except in the case of an assignment to a Lender or an Affiliate of a Lender or
an assignment of the entire remaining amount of the assigning Lender's
Commitment, the amount of the Commitment of the assigning Lender subject to each
such assignment (determined as of the date the Assignment and Acceptance with
respect to such assignment is delivered to the Administrative Agent) shall be an
aggregate amount that is an integral multiple of $1,000,000 and not less than
$10,000,000 unless each of the Borrower and the Administrative Agent otherwise
consent, (iii) each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender's rights and obligations under
this Agreement, (iv) the parties to each assignment shall execute and deliver to
the Administrative Agent an Assignment and Acceptance, together with a
processing and recordation fee of $3,500, and (v) the assignee, if it shall not
be a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire; and provided further that any consent of the Borrower otherwise
required under this paragraph shall not be required if an Event of Default under
clause (h) or (i) of Article VII has occurred and is continuing. Subject to
acceptance and recording thereof pursuant to paragraph (d) of this Section, from
and after the effective date specified in each Assignment and Acceptance the
assignee thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and obligations of a
Lender under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be released
from its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of (and therefore shall be treated as a Lender
for purposes of determing entitlement to the benefits of) Sections 2.13, 2.14,
2.15 and 9.03). Any assignment or transfer by a Lender of rights or obligations
under this Agreement that does not comply with this paragraph shall be treated
for purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with paragraph (e) of this Section.

<PAGE>

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

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

          (e) Any Lender may, without the consent of the Borrower, the
Administrative Agent or the Swingline Lender, sell participations to one or more
banks or other entities (a "Participant") in all or a portion of such Lender's
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it); provided that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (iii) the Borrower, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may provide that
such Lender will not, without the consent of the Participant, agree to any
amendment, modification or waiver described in the first proviso to Section
9.02(b) that affects such Participant. Subject to paragraph (f) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.13, 2.14 and 2.15 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section.
To the extent permitted by law, each Participant also shall be entitled to the
benefits of Section 9.08 as though it were a Lender, provided such Participant
agrees to be subject to Section 2.16(c) as though it were a Lender.

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

<PAGE>

notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 2.15(e) as
though it were a Lender.

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

          SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any
Loans, regardless of any investigation made by any such other party or on its
behalf and notwithstanding that the Administrative Agent or any Lender may have
had notice or knowledge of any Default or incorrect representation or warranty
at the time any credit is extended hereunder, and shall continue in full force
and effect as long as the principal of or any accrued interest on any Loan or
any fee or any other amount payable under this Agreement is outstanding and
unpaid and so long as the Commitments have not expired or terminated. The
provisions of Sections 2.13, 2.14, 2.15 and 9.03 and Article VIII shall survive
and remain in full force and effect regardless of the consummation of the
transactions contemplated hereby, the repayment of the Loans, the expiration or
termination of the Commitments or the termination of this Agreement or any
provision hereof.

          SECTION 9.06. Counterparts; Integration; Effectiveness. This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in
Section 4.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.

          SECTION 9.07. Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

<PAGE>

          SECTION 9.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of the
Borrower against any of and all the obligations of the Borrower now or hereafter
existing under this Agreement held by such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured. The rights of each Lender under this Section
are in addition to other rights and remedies (including other rights of setoff)
which such Lender may have. Any Lender that has set off and applied any amount
pursuant to this Section 9.08 shall thereafter provide notice to the Borrower
describing such set-off and application; provided, however, that the failure to
provide such notice shall not affect the validity of such set-off or
application.

          SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of
Process. (a) This Agreement shall be construed in accordance with and governed
by the law of the State of New York (without prejudice to the provisions of
Section 5-1401 of the General Obligations Law of the State of New York,
excluding such State's principles of conflicts of law).

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

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

          (d) Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process
in any other manner permitted by law.

<PAGE>

          SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

          SECTION 9.11. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

          SECTION 9.12. Confidentiality. Each of the Administrative Agent and
the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its Affiliates
and to its and their directors, officers, employees and agents, including
accountants, legal counsel and other advisors (it being understood that the
Persons to whom such disclosure is made will be informed of the confidential
nature of such Information and instructed to keep such Information confidential)
solely for use in connection with this Agreement and the transactions
contemplated hereby and the performance by the parties hereunder, (b) to the
extent requested by any regulatory authority, (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party to this Agreement, (e) in connection with the exercise of any
remedies hereunder or any suit, action or proceeding relating to this Agreement
or the enforcement of rights hereunder, (f) subject to an agreement containing
provisions substantially the same as those of this Section, to any assignee of
or Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement, (g) with the consent of the Borrower
or (h) to the extent such Information (i) becomes publicly available other than
as a result of a breach of this Section or (ii) becomes available to the
Administrative Agent or any Lender on a nonconfidential basis from a source
other than the Borrower. For the purposes of this Section, "Information" means
all information received from the Borrower or a Subsidiary relating to any of
the Borrower or a Restricted Subsidiary or its business, other than any such
information that is available to the Administrative Agent or any Lender on a
nonconfidential basis prior to disclosure by the Borrower or such Subsidiary.
Any Person required to maintain the confidentiality of Information as provided
in this Section shall be considered to have complied with its obligation to do
so if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information. The Lenders agree that the rights of the Borrower
under this Section shall be enforceable by specific performance.

<PAGE>

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

CONTIFINANCIAL CORPORATION,

   by
      /s/: James E. Moore
      -------------------
      Name:  James E. Moore
      Title: President and Chief Executive and Authorized Signatory

      /s/: Jerome M. Perelson
      -----------------------
      Name:  Jerome M. Perelson
      Title: Senior Vice President and Chief Financial Officer and 
             Authorized Signatory

<PAGE>

                                        CREDIT SUISSE FIRST BOSTON,             
                                        NEW YORK BRANCH,                        
                                        as Administrative Agent,                
                                                                                
                                            by                                  
                                                                                
                                            /s/: J. Colgan                      
                                            --------------                      
                                            Name:  J. Colgan                    
                                            Title: Vice President               
                                                                                
                                                                                
                                            /s/: Ira Lubinsky                   
                                            -----------------                   
                                            Name:  Ira Lubinsky                 
                                            Title: Associate                    
                                                                                
                                                                                
                                        CREDIT SUISSE FIRST BOSTON,             
                                        NEW YORK BRANCH, as a Lender,           
                                                                                
                                           by                                   
                                           /s/: J. Colgan                       
                                           --------------                       
                                           Name:  J. Colgan                     
                                           Title: Vice President                
                                                                                
                                           /s/: Ira Lubinsky                    
                                           -----------------                    
                                           Name:  Ira Lubinsky                  
                                           Title: Associate                     
                                                                                
<PAGE>
                                                                                
                                                                                
                                        DRESDNER BANK AG, NEW YORK AND          
                                        GRAND CAYMAN BRANCHES,                  
                                        as a Lender and as                      
                                        Swingline Lender,                       
                                                                                
                                           by                                   
                                              /s/: William M. Coulter           
                                              -----------------------           
                                              Name:  William M. Coulter         
                                              Title: Vice President             
                                                                                
                                                                                
                                           by                                   
                                              /s/: Craig D. Meisner             
                                              ---------------------             
                                              Name:  Craig D. Meisner           
                                              Title: Vice President             
                                                                                
<PAGE>
                                                                                
                                        THE BANK OF NEW YORK,                   
                                                                                
                                           by                                   
                                              /s/: Robert A. Tweed              
                                              --------------------              
                                              Name:  Robert A. Tweed            
                                              Title: Vice President             
                                                                                
<PAGE>
                                                                                
                                        CORESTATES BANK, N.A.,                  
                                                                                
                                           by                                   
                                              /s/: Andrew Tauber                
                                              ------------------                
                                              Name:  Andrew Tauber              
                                              Title: Vice President             
                                                                                
<PAGE>
                                                                                
                                        FIRST UNION NATIONAL BANK OF            
                                        NORTH CAROLINA,                         
                                                                                
                                           by                                   
                                              /s/: Peter G. Perna               
                                              -------------------               
                                              Name:  Peter G. Perna             
                                              Title: Vice President             
                                                                                
                                                                                
                                                                                
                                                                                
<PAGE>
                                                                                
                                        SOCIETE GENERALE,                       
                                                                                
                                           by                                   
                                              /s/: Karel Vasak                  
                                              ----------------                  
                                              Name:  Karel Vasak                
                                              Title: Vice President and Senior 
                                                     Relationship Director
                                                                                
<PAGE>
                                                                                
                                        COMERICA BANK,                          
                                                                                
                                           by                                   
                                              /s/: N. Donald Heath              
                                              --------------------              
                                              Name:  N. Donald Heath            
                                              Title: Vice President             
                                                                                
<PAGE>
                                                                                
                                                                                
                                        DEUTSCHE BANK AG, NEW YORK              
                                        AND/OR CAYMAN ISLANDS BRANCHES,         
                                                                                
                                           by                                   
                                              /s/: Gayma Z. Shivnarain          
                                              ------------------------          
                                              Name:  Gayma Z. Shivnarain        
                                              Title: Vice President             
                                                                                
                                                                                
                                           by                                   
                                              /s/: Dale F. Oberst               
                                              -------------------               
                                              Name:  Dale F. Oberst             
                                              Title: Associate                  
                                                                                
                                                                                
                                                                                
                                                                                
<PAGE>
                                                                                
                                        DG BANK DEUTSCHE                        
                                        GENOSSENSCHAFTSBANK, CAYMAN             
                                        ISLAND BRANCH,                          
                                                                                
                                           by                                   
                                              /s/: Karen A. Brinkman            
                                              ----------------------            
                                              Name:  Karen A. Brinkman          
                                              Title: Vice President             
                                                                                
                                                                                
                                           by                                   
                                              /s/: Robert B. Herber             
                                              ---------------------             
                                              Name:  Robert B. Herber           
                                              Title: Vice President             
                                                                                
                                                                                
                                                                                
<PAGE>
                                                                                
                                                                                
                                        THE BANK OF NOVA SCOTIA,                
                                                                                
                                           by                                   
                                              /s/: Stephen Lockhart             
                                              ---------------------             
                                              Name:  Stephen Lockhart           
                                              Title: Vice President             
                                                                                
                                                                                
                                                                                
                                                                                
<PAGE>
                                                                                
                                        CREDIT LYONNAIS NEW YORK BRANCH,        
                                                                                
                                           by                                   
                                              /s/: Robert Ivosevich             
                                              ---------------------             
                                              Name:  Robert Ivosevich           
                                              Title: Senior Vice President      
                                                                                
                                                                                
<PAGE>
                                                                                
                                                                                
                                        MORGAN GUARANTY TRUST COMPANY           
                                        OF NEW YORK,                            
                                                                                
                                           by                                   
                                              /s/: Seija K. Hurskainen          
                                              ------------------------          
                                              Name:  Seija K. Hurskainen        
                                              Title: Vice President             
                                                                                
                                                                                
                                                                                
                                                                                
<PAGE>
                                                                                
                                        PNC BANK, NATIONAL ASSOCIATION,         
                                                                                
                                           by                                   
                                              /s/: Kirk Seagers                 
                                              -----------------                 
                                              Name:  Kirk Seagers               
                                              Title: Assistant Vice President   
                                                                                
                                                                                
                                                                                
                                                                                
<PAGE>
                                                                                
                                        THE SUMITOMO BANK, LIMITED,             
                                        NEW YORK BRANCH,                        
                                                                                
                                           by                                   
                                              /s/: John C. Kissinger            
                                              ----------------------            
                                              Name:  John C. Kissinger          
                                              Title: Joint General Manager      
                                        
<PAGE>

                                                                   SCHEDULE 2.01

                               Contact Person, Address and
Name of Lender                 Telephone and Telecopy Numbers       Commitment
--------------                 ------------------------------       ----------

Credit Suisse First Boston,    Diane Albanese                       $20,000,000
New York Branch                11 Madison Avenue
                               New York, NY 10010
                               Tel: (212) 325-9935
                               Fax: (212) 238-5073


Dresdner Bank AG, New York     William M. Coulter                   $20,000,000 
and Grand Cayman Branches      75 Wall Street                                   
                               New York, NY 10005                               
                               Tel: (212) 429-4160                           
                               Fax: (212) 429-4170                           


The Bank of New York           Robert A. Tweed                      $15,000,000
                               One Wall Street
                               New York, NY 10286
                               Tel: (212) 635-6465
                               Fax: (212) 635-6468


CoreStates Bank, N.A.          Andrew Tauber                        $15,000,000
                               John White
                               Helen Wessling
                               1339 Chestnut Street
                               Philadelphia, PA 19107-3579
                               Tel: (215) 786-4367
                               Fax: (215) 786-8304


First Union National Bank      Peter G. Perna                       $15,000,000
of North Carolina              301 S. College Street DC-6
                               Charlotte, NC 28288-0166
                               Tel: (704) 383-1946
                               Fax: (704) 374-7102

Societe Generale               Michelle Vensel                      $15,000,000
                               Matthew Blesso

<PAGE>

                               1221 Avenue of the Americas
                               New York, NY 10020
                               Tel: (212) 278-6425/6882
                               Fax: (212) 278-7462


Comerica Bank                  Von Ringger                          $15,000,000
                               500 Woodward Avenue MC 3256
                               Detroit, MI 48226
                               Tel:     (313) 222-9285
                               Fax:     (313) 222-9295

Deutsche Bank AG, New York     Dale Oberst                          $15,000,000
and/or Cayman Islands          31 West 52nd Street
Branches                       New York, NY 10019
                               Tel: (212) 469-8667
                               Fax: (212) 469-8108


DG Bank Deutsche               Robert B. Herber                     $15,000,000
Genossenschaftsbank,           609 Fifth Avenue
Cayman Island Branch           New York, NY 10017
                               Tel: (212) 745-1581
                               Fax: (212) 745-1556/1550


The Bank of Nova Scotia        Alan Reiter                          $15,000,000
                               One Liberty Plaza, 26th Floor
                               New York, NY 10006
                               Tel: (212) 225-5028
                               Fax: (212) 225-5090


Credit Lyonnais                Andrea Griffis                       $10,000,000
New York Branch                NY Corporate Group A
                               1301 Avenue of the Americas
                               New York, NY 10019
                               Tel: (212) 261-7325
                               Fax: (212) 459-3179
<PAGE>

Morgan Guaranty Trust          Seija K. Hurskainen                  $10,000,000
Company of New York            60 Wall Street
                               New York, NY 10260-0060
                               Tel: (212) 648-3201
                               Fax: (212) 648-5249


PNC Bank National              Robert Bjorhus                       $10,000,000
Association                    1600 Market Street
                               Philadelphia, PA 19103
                               Tel: (215) 585-6872
                               Fax: (215) 585-7615


The Sumitomo Bank,             Betsy A. Sprenkle                    $10,000,000
Limited, New York Branch       277 Park Avenue, 6th Floor
                               New York, NY 10172
                               Tel: (212) 224-4154
                               Fax: (212) 224-5188



Total Commitment                                                    $200,000,000

<PAGE>

                                                                       EXHIBIT A
                                     FORM OF

                            ASSIGNMENT AND ACCEPTANCE

          Reference is made to the Credit Agreement dated as of January 7, 1997
(as amended and in effect on the date hereof, the "Credit Agreement"), among the
ContiFinancial Corporation, the Lenders named therein and Credit Suisse First
Boston, New York Branch, as Administrative Agent for the Lenders. Terms defined
in the Credit Agreement are used herein with the same meanings.

          The Assignor named on the reverse hereof hereby sells and assigns,
without recourse, to the Assignee named on the reverse hereof, and the Assignee
hereby purchases and assumes, without recourse, from the Assignor, effective as
of the Assignment Date set forth on the reverse hereof, the interests set forth
on the reverse hereof (the "Assigned Interest") in the Assignor's rights and
obligations under the Credit Agreement, including, without limitation, the
interests set forth on the reverse hereof in the Commitment of the Assignor on
the Assignment Date and Revolving Loans owing to the Assignor which are
outstanding on the Assignment Date, together with the participations in
Swingline Loans held by the Assignor on the Assignment Date, but excluding
accrued interest and fees to and excluding the Assignment Date. The Assignee
hereby acknowledges receipt of a copy of the Credit Agreement. From and after
the Assignment Date (i) the Assignee shall be a party to and be bound by the
provisions of the Credit Agreement and, to the extent of the Assigned Interest,
have the rights and obligations of a Lender thereunder and (ii) the Assignor
shall, to the extent of the Assigned Interest, relinquish its rights and be
released from its obligations under the Credit Agreement.

          This Assignment and Acceptance is being delivered to the
Administrative Agent together with (i) if the Assignee is a Foreign Lender, any
documentation required to be delivered by the Assignee pursuant to Section
2.15(e) of the Credit Agreement, duly completed and executed by the Assignee,
and (ii) if the Assignee is not already a Lender under the Credit Agreement, an
Administrative Questionnaire in the form supplied by the Administrative Agent,
duly completed by the Assignee. The [Assignee/Assignor] shall pay the fee
payable to the Administrative Agent pursuant to Section 9.04(b) of the Credit
Agreement.

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

Date of Assignment:

Legal Name of Assignor:

Legal Name of Assignee:

Assignee's Address for Notices:

Effective Date of Assignment
("Assignment Date"):

                                                        Percentage Assigned of
<PAGE>

                                                         Facility/Commitment
                                                         (set forth, to at least
                                                         8 decimals, as a
                                                         percentage of the 
                                                         Facility and the
                                                         aggregate Commitments 
                                                         of all Lenders
Facility                Principal Amount Assigned        thereunder)
--------                -------------------------        -----------
Commitment Assigned:    $                                             %
Revolving Loans:

The terms set forth above and on the reverse side hereof are hereby agreed to:


                                      [Name of Assignor], as Assignor

                                      By: ________________________________
                                          Name:
                                          Title:


                                      [Name of Assignee], as Assignee

                                      By: ________________________________
                                          Name:
                                          Title:

The undersigned hereby consent to the within assignment:1


ContiFinancial Corporation,           Credit Suisse First Boston, New
                                      York Branch, Administrative Agent,

By: ____________________________      By: ________________________________
    Name:                                 Name:
    Title:                                Title:

By: ____________________________       Dresdner Bank AG, New York and
    Name:                              Grand Cayman Branches, as
    Title:                             Swingline Lender,

                                       By: _______________________________
                                           Name:
                                           Title:

----------
(1)  Consents to be included to the extent required by Section 9.04(b) of the
     Credit Agreement.

<PAGE>

                                    EXHIBIT C

                                     FORM OF

BORROWING BASE CERTIFICATE

To:      The Lenders Party to
         the Credit Agreement

          This Borrowing Base Certificate is furnished pursuant to the Credit
Agreement dated as of January 7, 1997, among ContiFinancial Corporation (the
"Borrower"), the Lenders party thereto and Credit Suisse, as administrative
agent. Each capitalized term used and not otherwise defined herein shall have
the meaning assigned to it in the Credit Agreement.

          THE UNDERSIGNED HEREBY CERTIFIES THAT:

          1.   I am a duly elected Financial Officer of the Borrower;

          2.   I have reviewed the terms of the Credit Agreement and I have
               made, or have caused to be made under my supervision, a detailed
               review of the transactions and conditions of the Borrower and its
               Restricted Subsidiaries during the period covered by the attached
               form; and

          3.   The attached form sets forth data and computations required by
               and complying with certain provisions of the Credit Agreement,
               all of which data and computations are true, complete and correct
               in all material respects.

          The foregoing certification, together with the data and computations,
attached hereto is made and delivered this __ day of 19__.


                                    CONTIFINANCIAL CORPORATION,

                                       by _______________________________
                                          Name:
                                          Title:


<PAGE>

ContiFinancial Corporation
Attachment to Borrowing Base Certificate
Credit Agreement dated as of January 7, 1997
Borrowing Base data and computations as of __________, 19__

<TABLE>
<CAPTION>
                                       Total                           Contribution to
               Asset                 Amount Not      Advance             Borrowing Base
              Category               Less Than        Rate      (Total Amount x Advance Rate)
              --------               ---------        ----      -----------------------------
<S>                                      <C>          <C>             <C>                 
Eligible Cash & Cash Equivalents         $            100%             $                
Eligible Receivables                     $            95%              $                
Eligible Fixed Income Securities                                                        
Eligible I/O Strip Securities            $            85%              $                
Eligible Performance Deposits            $            80%              $                
Capitalized Servicing Fees               $            75%              $                
Eligible Residuals                       $            65%              $                
                                                                      ----------------- 
                                                 Subtotal:             $                
Outstanding Funded Indebtedness                                                         
                                                                      ($              ) 
                                                                      ----------------- 
                                                 Subtotal:             $                
                                                                       multiplied by 2  
                                                                      =================
                                                 Borrowing                              
                                                 Base Total:           $                
</TABLE>