AMENDED AND RESTATED CREDIT
                                    AGREEMENT



                                      among



                               WESTWOOD ONE, INC.,

                               The Several Lenders
                        from Time to Time Parties Hereto,



                                       and



                            THE CHASE MANHATTAN BANK,
                            as Administrative Agent,

                 THE FIRST NATIONAL BANK OF BOSTON, as Co-Agent,

                         BANK OF MONTREAL, as Co-Agent,

                     BANK OF AMERICA ILLINOIS, as Co-Agent.




                         Dated as of September 30, 1996




<PAGE>
<TABLE>

                                TABLE OF CONTENTS

                                                                                                                                Page


<S>       <C>                                                                                                                    <C>
SECTION 1.  DEFINITIONS..........................................................................................................  1
           1.1  Defined Terms....................................................................................................  1
           1.2  Other Definitional Provisions.................................................................................... 19

SECTION 2.  AMOUNT AND TERMS OF COMMITMENTS...................................................................................... 19
           2.1  Revolving Credit Commitments..................................................................................... 19
           2.2  Procedure for Revolving Credit Borrowing......................................................................... 19
           2.3  Commitment Fee................................................................................................... 20
           2.4  Termination or Reduction of Revolving Credit Commitments......................................................... 20
           2.5  Term Loans....................................................................................................... 21
           2.6  Procedure for Term Loan Borrowing................................................................................ 21
           2.7  Repayment of Loans; Evidence of Debt............................................................................. 22
           2.8  Optional Prepayments............................................................................................. 23
           2.9  Mandatory Prepayments and Commitment Reductions.................................................................. 24
           2.10  Conversion and Continuation Options............................................................................. 25
           2.11  Minimum Amounts and Maximum Number of Tranches.................................................................. 26
           2.12  Interest Rates and Payment Dates................................................................................ 26
           2.13  Computation of Interest and Fees................................................................................ 26
           2.14  Inability to Determine Interest Rate............................................................................ 27
           2.15  Pro Rata Treatment and Payments................................................................................. 28
           2.16  Illegality...................................................................................................... 28
           2.17  Requirements of Law............................................................................................. 29
           2.18  Taxes........................................................................................................... 30
           2.19  Indemnity....................................................................................................... 31
           2.20  Change of Lending Office; Replacement or Prepayment of Lenders.................................................. 32
           2.21  Commitment Increases............................................................................................ 33

SECTION 3.  REPRESENTATIONS AND WARRANTIES....................................................................................... 34
           3.1  Financial Condition.............................................................................................. 34
           3.2  No Change........................................................................................................ 35
           3.3  Corporate Existence; Compliance with Law......................................................................... 35
           3.4  Corporate Power; Authorization; Enforceable Obligations.......................................................... 35
           3.5  No Legal Bar..................................................................................................... 35
           3.6  No Material Litigation........................................................................................... 36
           3.7  No Default....................................................................................................... 36
           3.8  Ownership of Property; Liens..................................................................................... 36
           3.9  Intellectual Property............................................................................................ 36
           3.10  Taxes........................................................................................................... 36
           3.11  Federal Regulations............................................................................................. 36
           3.12  ERISA........................................................................................................... 37
           3.13  Investment Company Act; Other Regulations....................................................................... 37
           3.14  Subsidiaries.................................................................................................... 37
           3.15  Purpose of Loans................................................................................................ 37


<PAGE>


                                                                                                                                Page

           3.16  Environmental Matters........................................................................................... 37
           3.17  Senior Indebtedness............................................................................................. 38
           3.18  Certain Documents............................................................................................... 38

SECTION 4.  CONDITIONS PRECEDENT................................................................................................. 38
           4.1  Conditions to Effectiveness...................................................................................... 38
           4.2  Conditions to Each Loan.......................................................................................... 40

SECTION 5.  AFFIRMATIVE COVENANTS................................................................................................ 40
           5.1  Financial Statements............................................................................................. 41
           5.2  Certificates; Other Information.................................................................................. 41
           5.3  Payment of Obligations........................................................................................... 42
           5.4  Conduct of Business and Maintenance of Existence................................................................. 42
           5.5  Maintenance of Property; Insurance............................................................................... 42
           5.6  Inspection of Property; Books and Records; Discussions........................................................... 42
           5.7  Notices.......................................................................................................... 42
           5.8  Additional Guarantors............................................................................................ 43
           5.9  Unrestricted Subsidiaries; Maintenance of Separate Corporate Identity............................................ 43

SECTION 6.  NEGATIVE COVENANTS................................................................................................... 45
           6.1  Financial Condition Covenants.................................................................................... 45
           6.2  Limitation on Indebtedness....................................................................................... 45
           6.3  Limitation on Liens.............................................................................................. 46
           6.4  Limitation on Guarantee Obligations.............................................................................. 47
           6.5  Limitation on Fundamental Changes................................................................................ 48
           6.6  Limitation on Sale of Assets..................................................................................... 48
           6.7  Limitation on Restricted Payments................................................................................ 49
           6.8  Limitation on Investments, Loans and Advances.................................................................... 50
           6.9  Limitation on Optional Payments and Modifications of Debt Instruments............................................ 51
           6.10  Limitation on Capital Expenditures.............................................................................. 51
           6.11  Limitation on Sale or Discount of Receivables................................................................... 51
           6.12  Limitation on Transactions with Affiliates...................................................................... 52
           6.13  Limitation on Changes in Fiscal Year............................................................................ 52
           6.14  Limitation on Negative Pledge Clauses........................................................................... 52
           6.15  Limitation on Lines of Business................................................................................. 52

SECTION 7.  EVENTS OF DEFAULT.................................................................................................... 52

SECTION 8.  THE ADMINISTRATIVE AGENT............................................................................................. 55
           8.1  Appointment...................................................................................................... 55
           8.2  Delegation of Duties............................................................................................. 56
           8.3  Exculpatory Provisions........................................................................................... 56
           8.4  Reliance by Administrative Agent................................................................................. 56
           8.5  Notice of Default................................................................................................ 57
           8.6  Non-Reliance on Administrative Agent and Other Lenders........................................................... 57

                                     - ii -

<PAGE>


                                                                                                                                Page

           8.7  Indemnification.................................................................................................. 58
           8.8  Administrative Agent in Its Individual Capacity.................................................................. 58
           8.9  Successor Agents................................................................................................. 58

SECTION 9.  MISCELLANEOUS........................................................................................................ 59
           9.1  Amendments and Waivers........................................................................................... 59
           9.2  Notices.......................................................................................................... 60
           9.3  No Waiver; Cumulative Remedies................................................................................... 60
           9.4  Survival of Representations and Warranties....................................................................... 60
           9.5  Payment of Expenses and Taxes.................................................................................... 60
           9.6  Successors and Assigns; Participations and Assignments........................................................... 61
           9.7  Adjustments; Set-off............................................................................................. 63
           9.8  Counterparts..................................................................................................... 64
           9.9  Severability..................................................................................................... 64
           9.10  Integration..................................................................................................... 64
           9.11  GOVERNING LAW................................................................................................... 64
           9.12  Submission To Jurisdiction; Waivers............................................................................. 64
           9.13  Acknowledgements................................................................................................ 65
           9.14  WAIVERS OF JURY TRIAL........................................................................................... 65
           9.15  Treatment of Certain Information; Confidentiality............................................................... 66
           9.16  Senior Indebtedness............................................................................................. 66


                                     - iii -
</TABLE>

<PAGE>

SCHEDULES

I          Commitments
3.1        Dispositions
3.14       Subsidiaries
6.2        Permitted Indebtedness
6.3        Permitted Liens
6.4        Permitted Guarantees
6.8        Permitted Investments
6.12       Permitted Transactions with Affiliates


EXHIBITS

A-1        Form of Revolving Credit Note
A-2        Form of Term Note
B          Form of Amended and Restated Management Services Subordination
             Agreement
C          Form of Guarantee
D          Form of Opinion of Counsel to the Loan Parties
E          Form of Assignment and Acceptance
F          Form of Borrowing Certificate
G          Form of Tax Allocation Agreement
H-1        Form of New Lender Supplement
H-2        Form of Commitment Increase Supplement

                                     - iv -

<PAGE>

                     AMENDED  AND  RESTATED  CREDIT   AGREEMENT,   dated  as  of
September  30, 1996,  among  WESTWOOD  ONE,  INC., a Delaware  corporation  (the
"Borrower"),  the several banks and other  financial  institutions  from time to
time parties to this  Agreement  (the  "Lenders"),  THE FIRST  NATIONAL  BANK OF
BOSTON,  BANK OF MONTREAL and BANK OF AMERICA  ILLINOIS,  as  co-agents  for the
Lenders  hereunder (in such capacity,  the  "Co-Agents") and THE CHASE MANHATTAN
BANK, as Administrative Agent for the Lenders hereunder.


                              W I T N E S S E T H:
                              --------------------

                     WHEREAS, the Borrower, the Administrative Agent and certain
banks and other  financial  institutions  are  parties to the Credit  Agreement,
dated as of  February 3, 1994 (as  amended  and waived to the date  hereof,  the
"Existing  Credit  Agreement"),  pursuant to which the lenders  thereunder  made
loans to the Borrower under the terms provided for therein;

                     WHEREAS, the Borrower has informed the Administrative Agent
that it intends to refinance  certain of its existing  indebtedness  and to make
acquisitions and has requested that the Existing Credit Agreement be amended and
restated to, inter alia, provide for (i) a $75,000,000 revolving credit facility
(subject to increase as provided  for herein) and (ii) a  $75,000,000  term loan
facility, which Facilities will be utilized by the Borrower to refinance certain
of its existing indebtedness,  to make acquisitions and to provide financing for
the working capital needs and general corporate purposes of the Borrower and its
Subsidiaries,  including  the  repurchase  of  shares of its  Capital  Stock and
capital expenditures; and

                     WHEREAS,  the  Administrative  Agent  and the  Lenders  are
willing so to amend and restate the Existing Credit  Agreement,  but only on the
terms and conditions hereof;

                     NOW,  THEREFORE,  in  consideration of the mutual covenants
and  premises  hereinafter  set forth,  effective  as of the Closing  Date,  the
parties  hereto  hereby  amend and  restate the  Existing  Credit  Agreement  as
follows:


                             SECTION 1. DEFINITIONS

                     1.1 Defined Terms. As used in this Agreement, the following
terms shall have the following meanings:

                     "ABR":  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%.  For  purposes
           hereof:  "Prime  Rate"  shall  mean the rate of  interest  per  annum
           publicly announced from time to time by the  Administrative  Agent as
           its prime  rate in effect  at its  principal  office in New York City
           (the Prime Rate not being  intended to be the lowest rate of interest
           charged by Chase in connection with extensions of credit to debtors);
           and "Federal Funds Effective Rate" shall mean, for


<PAGE>


                                        2



           any day, the weighted average 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 which is a Business Day, the average of the
           quotations  for  the  day  of  such  transactions   received  by  the
           Administrative  Agent from three  federal funds brokers of recognized
           standing selected by it. Any change in the ABR 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.

                      "ABR  Loans":  loans the rate of  interest  applicable  to
           which is based upon the ABR.

                     "Adjustment  Date":  each date on or after the Closing Date
           that is the second  Business Day following  receipt by the Lenders of
           both (i) the financial  statements  required to be delivered pursuant
           to subsection 5.1(a) or 5.1(b), as applicable,  for the most recently
           completed fiscal period and (ii) the related  compliance  certificate
           required to be delivered  pursuant to subsection  5.2(b) with respect
           to such fiscal period.

                      "Administrative   Agent":   Chase,   together   with   its
           affiliates,   as  the  arranger  of  the   Commitments   and  as  the
           administrative  agent for the Lenders  under this  Agreement  and the
           other Loan Documents.

                      "Affiliate":  as to any Person,  any other  Person  (other
           than a Subsidiary) which,  directly or indirectly,  is in control of,
           is controlled by, or is under common control with, such Person.

                      "Agreement":  this Amended and Restated Credit  Agreement,
           as amended, supplemented or otherwise modified from time to time.

                     "Annualized   Consolidated  Corporate  Overhead":  for  any
           period, corporate general and administrative expenses of the Borrower
           and its  Restricted  Subsidiaries  for  such  period  as shown on the
           consolidated  financial statements of the Borrower and its Restricted
           Subsidiaries  for such period delivered to the  Administrative  Agent
           pursuant to subsection 5.1(a) or 5.1(b); provided that there shall be
           excluded from "Annualized  Consolidated  Corporate  Overhead" (a) all
           non-cash  charges and (b) all  corporate  general and  administrative
           expenses  of  the  Borrower  incurred  on  behalf  of,  or  otherwise
           attributable  to,  Unrestricted  Subsidiaries  or in connection  with
           management  and  other  services  and  activities  performed  by  the
           Borrower for Unrestricted Subsidiaries.

                      "Annualized  Consolidated Operating Cash Flow" or "ACOCF":
           for any period,  the aggregate  amount  (determined on a consolidated
           basis without  duplication in accordance with GAAP), for the Borrower
           and its Restricted  Subsidiaries,  of (a) the sum of (i) net revenues
           of the Borrower and its Restricted Subsidiaries for such period


<PAGE>
                                        3

           (calculated  before  taxes  and  excluding  (A) any net  gain or loss
           arising from the sale of capital  assets during such period;  (B) any
           gain arising from any write-up of assets during such period;  (C) net
           earnings  for such period of any Person in which the  Borrower or any
           of its Restricted  Subsidiaries has an ownership interest unless such
           net earnings  shall have  actually  been  received by the Borrower or
           such Restricted  Subsidiary in the form of cash distributions  (other
           than cash distributions received by the Borrower from an Unrestricted
           Subsidiary);  (D) any portion of the net  earnings of any  Restricted
           Subsidiary of the Borrower or any of its Restricted  Subsidiaries for
           such  period  which for any  reason is  unavailable  for  payment  of
           dividends  to the Borrower or any other such  Restricted  Subsidiary;
           (E) any gain realized during such period arising from the acquisition
           of  any   securities  of  the  Borrower  or  any  of  its  Restricted
           Subsidiaries;  (F) any "extraordinary",  "unusual" or "non-recurring"
           earnings or "extraordinary",  "unusual" or "non-recurring" losses for
           such period as such terms are  interpreted  under  GAAP;  and (G) any
           interest  income  of the  Borrower  and its  Restricted  Subsidiaries
           realized  during such period)  minus (ii)  operating  expenses of the
           Borrower and its Restricted  Subsidiaries for such period  (excluding
           depreciation,  amortization,  interest  expense  and  other  non-cash
           charges  accrued,  and income  taxes paid or accrued  (other than any
           such taxes attributable to the revenues of Unrestricted  Subsidiaries
           for  which  the  Borrower  has  not  been  or is not  entitled  to be
           reimbursed,  or in respect of which the  Borrower has not received or
           is not entitled to receive a credit, pursuant to the terms of any Tax
           Allocation  Agreement),  for  such  period  by the  Borrower  and its
           Restricted  Subsidiaries) minus (b) Annualized Consolidated Corporate
           Overhead for such period;  provided that for purposes of  calculating
           Annualized Consolidated Operating Cash Flow when such term is used in
           determining  the Total  Debt  Ratio,  if the  Borrower  or any of its
           Restricted  Subsidiaries  shall have  acquired  or disposed of one or
           more businesses (or any part thereof) during such period,  Annualized
           Consolidated Operating Cash Flow for such period shall be computed as
           if (in the case of an  acquisition)  such  business (or part thereof)
           had been owned by the Borrower or such Restricted  Subsidiary for the
           whole of such period or (in the case of a disposition)  such business
           (or part thereof) had been disposed of prior to the first day of such
           period.

                     "Applicable  Margin":  during the period  from the  Closing
           Date until the first  Adjustment  Date, the  Applicable  Margin shall
           equal  (i) with  respect  to ABR  Loans,  0% per  annum and (ii) with
           respect to Eurodollar Loans,  .750% per annum; such Applicable Margin
           will be adjusted on each  Adjustment  Date to the applicable rate per
           annum set forth under the column heading  "Alternate Base Rate Loans"
           or "Eurodollar  Loans" on the table set forth below which corresponds
           to the Total Debt Ratio determined from the financial  statements and
           compliance  certificate  relating  to the end of the  fiscal  quarter
           immediately preceding such Adjustment Date;

<PAGE>

                                        4



--------------------------------------------------------------------------------
               Total Debt                       Alternate Base        Eurodollar
              equal to 5.00:1                     .250%               1.250%
--------------------------------------------------------------------------------
less than 5.00:1 and greater than or
equal to 4.25:1                                       0%                1.000%
--------------------------------------------------------------------------------
less than 4.25:1 and greater than or
equal to 3.25:1                                       0%                 .750%
--------------------------------------------------------------------------------
less than 3.25:1                                      0%                 .500%
--------------------------------------------------------------------------------

           provided that in the event that the financial  statements required to
           be delivered  pursuant to subsection 5.1(a) or 5.1(b), as applicable,
           and the  related  compliance  certificate  required  to be  delivered
           pursuant to subsection 5.2(b), are not delivered when due, then

                               (a) if such financial  statements and certificate
                     are delivered after the date such financial  statements and
                     certificate  were required to be delivered  (without giving
                     effect to any  applicable  cure period) and the  Applicable
                     Margin increases from that previously in effect as a result
                     of the  delivery  of such  financial  statements,  then the
                     Applicable  Margin  during  the  period  from the date upon
                     which  such  financial   statements  were  required  to  be
                     delivered  (without  giving effect to any  applicable  cure
                     period)  until  the  date  upon  which  they  actually  are
                     delivered shall, except as otherwise provided in clause (c)
                     below, be the Applicable Margin as so increased;

                               (b) if such financial  statements and certificate
                     are  delivered  (without  giving effect to any cure period)
                     after the date such financial  statements  and  certificate
                     were  required to be delivered  and the  Applicable  Margin
                     decreases from that previously in effect as a result of the
                     delivery of such financial  statements,  then such decrease
                     in the Applicable  Margin shall not become applicable until
                     the  date  upon   which  the   financial   statements   and
                     certificate actually are delivered; and

                               (c) if such financial  statements and certificate
                     are not delivered prior to the expiration of the applicable
                     cure period, then, effective upon such expiration,  for the
                     period from the date upon which such  financial  statements
                     and  certificate  were required to be delivered  (after the
                     expiration  of  the  applicable   cure  period)  until  two
                     Business  Days  following the date upon which they actually
                     are delivered,  the Applicable  Margin shall be 1.250%,  in
                     the case of Eurodollar Loans, and .250%, in the case of ABR
                     Loans (it being  understood  that the  foregoing  shall not
                     limit  the  rights  of the  Administrative  Agent  and  the
                     Lenders set forth in subsection 2.12(c) or Section 7).

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



<PAGE>

                                        5

                     "Assignee":  as defined in subsection 9.6(c).

                      "Available Revolving Credit Commitments":  at any time, an
           amount  equal to the excess,  if any, of (a) the amount of  Revolving
           Credit  Commitments  then in effect over (b) the aggregate  principal
           amount of all Revolving Credit Loans then outstanding.

                     "BOA":  Bank of America Illinois.

                     "BOB":  The First National Bank of Boston.

                     "BOM":  Bank of Montreal.

                      "Borrowing  Date":  any Business Day specified in a notice
           pursuant  to  subsection  2.2 or 2.6 as a date on which the  Borrower
           requests the Lenders to make Loans hereunder.

                     "Business  Day":  a day other  than a  Saturday,  Sunday or
           other day on which  commercial  banks in New York City are authorized
           or required by law to close; provided, that when such term is used to
           describe  a day on  which  a  borrowing,  payment  or  interest  rate
           determination is to be made in respect of a Eurodollar Loan, such day
           shall  also be a day on which  dealings  in  foreign  currencies  and
           exchange between banks may be carried on in London, England.

                     "Capital   Expenditures":   shall  mean,  for  any  period,
           expenditures   (including  the  aggregate  amount  of  Capital  Lease
           Obligations  incurred during such period) made by the Borrower or any
           of its Restricted  Subsidiaries to acquire or construct fixed assets,
           plant   and   equipment   (including   renewals,   improvements   and
           replacements,  but excluding  repairs) during such period computed in
           accordance with GAAP.

                      "Capital   Stock":   any   and  all   shares,   interests,
           participations or other equivalents  (however  designated) of capital
           stock of a corporation, any and all equivalent ownership interests in
           a Person  (other  than a  corporation)  and any and all  warrants  or
           options to purchase any of the foregoing.

                     "Cash  Equivalents":  (a) securities with maturities of one
           year or less from the date of acquisition  issued or fully guaranteed
           or insured by the United States Government or any agency thereof, (b)
           certificates  of deposit and eurodollar time deposits with maturities
           of one year or less from the date of  acquisition  and overnight bank
           deposits of any Lender or of any  commercial  bank having capital and
           surplus in excess of $500,000,000,  (c) repurchase obligations of any
           Lender or of any commercial bank having capital and surplus in excess
           of $500,000,000,  having a term of not more than 30 days with respect
           to  securities  issued or fully  guaranteed  or insured by the United
           States Government, (d) commercial paper of a domestic issuer rated at


<PAGE>


                                        6



           least A-2 by Standard and Poor's Ratings  Services  ("S&P") or P-2 by
           Moody's Investors Service, Inc. ("Moody's"), (e) debt securities with
           maturities of one year or less from the date of acquisition issued or
           fully  guaranteed  by any state,  commonwealth  or  territory  of the
           United States,  by any political  subdivision or taxing  authority of
           any such state,  commonwealth or territory or by any Person which are
           rated at least A by S&P or A by  Moody's,  (f) debt  securities  with
           maturities of one year or less from the date of acquisition backed by
           standby letters of credit issued by any Lender or any commercial bank
           satisfying the  requirements  of clause (b) of this  definition,  (g)
           shares  of  money  market   mutual  or  similar  funds  which  invest
           exclusively  in assets  satisfying  the  requirements  of clauses (a)
           through (f) of this  definition or (h)  securities  similar in nature
           and maturity to those described in the foregoing  clauses (a) through
           (g)  denominated  in  foreign  currencies  and  owned  by  a  Foreign
           Subsidiary.

                     "Chase":  The Chase Manhattan Bank.

                      "Class   Action   Warrants":   shall  mean  the   warrants
           outstanding  as of the date  hereof  (not in excess of  3,000,000  in
           number), each exercisable by the holder thereof to purchase one share
           of the common  stock of the  Borrower at a price of $17.25 per share,
           as in effect from time to time.

                      "Closing Date": the date on which the conditions precedent
           set forth in subsection 4.1 shall be satisfied.

                     "Co-Agents":  as defined in the preamble hereto.

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

                      "Commitment  Increase  Offer":  as defined  in  subsection
           2.21(a).

                      "Commitment  Period":  the period from and  including  the
           Closing  Date  to but  not  including  the  Termination  Date or such
           earlier  date  on  which  the  Revolving  Credit   Commitments  shall
           terminate as provided herein.

                      "Commitments": collectively, the Term Loan Commitments and
           the Revolving Credit Commitments.

                     "Commonly  Controlled  Entity":  an entity,  whether or not
           incorporated,  which is under common control with the Borrower within
           the  meaning  of  Section  4001 of ERISA or is part of a group  which
           includes the Borrower and which is treated as a single employer under
           Section 414 of the Code.

                      "Contractual Obligation":  as to any Person, any provision
           of any security issued by such Person or of any agreement, instrument
           or other  undertaking  to which such Person is a party or by which it
           or any of its property is bound.

                     "Declined Amount":  as defined in subsection 2.21(a).


<PAGE>

                                        7

                     "Declining Lender":  as defined in subsection 2.21(a).

                      "Default":  any of the  events  specified  in  Section  8,
           whether or not any requirement for the giving of notice, the lapse of
           time, or both, or any other condition, has been satisfied.

                      "Dollars"  and "$":  dollars  in  lawful  currency  of the
           United States.

                      "Domestic  Subsidiary":  any  Subsidiary  of the  Borrower
           organized  under  the  laws of any  jurisdiction  within  the  United
           States.

                     "Environmental Laws": any and all foreign,  Federal, state,
           local  or  municipal  laws,  rules,  orders,  regulations,  statutes,
           ordinances,   codes,   decrees,   requirements  of  any  Governmental
           Authority  or  other  Requirements  of  Law  (including  common  law)
           regulating, relating to or imposing liability or standards of conduct
           concerning  protection of human health or the environment,  as now or
           may at any time hereafter be in effect.

                      "Environmental  Permits":  any and all permits,  licenses,
           registrations,  notifications, exemptions and any other authorization
           required under any Environmental Law.

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

                     "Eurocurrency Reserve Requirements": for any day as applied
           to a Eurodollar  Loan,  the aggregate  (without  duplication)  of the
           rates  (expressed as a decimal  fraction) of reserve  requirements in
           effect   on  such  day   (including,   without   limitation,   basic,
           supplemental,  marginal and emergency  reserves under any regulations
           of the Board of  Governors  of the  Federal  Reserve  System 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 such System.

                     "Eurodollar  Base  Rate":  with  respect to each day during
           each Interest  Period  pertaining to a Eurodollar  Loan, the rate per
           annum equal to the  arithmetic  mean  (rounded  upward to the nearest
           1/100th  of 1%) of the  respective  rates per annum  notified  to the
           Administrative  Agent by each of the Reference Lenders as the rate at
           which such Reference  Lender is offered  Dollar  deposits at or about
           10:00 A.M.,  New York City time,  on the date two Business Days prior
           to the beginning of such Interest Period in the interbank  eurodollar
           market  where  the  eurodollar  and  foreign  currency  and  exchange
           operations  in  respect  of  its  Eurodollar  Loans  are  then  being
           conducted,  for delivery on the first day of such Interest Period for
           the number of days comprised  therein and in an amount  comparable to
           the  amount of its  Eurodollar  Loan to be  outstanding  during  such
           Interest Period.



<PAGE>
                                        8


                      "Eurodollar Loans":  Loans the rate of interest applicable
           to which is based upon the Eurodollar Rate.

                      "Eurodollar  Rate":  with  respect to each day during each
           Interest  Period  pertaining  to a Eurodollar  Loan, a rate per annum
           determined  for such day in  accordance  with the  following  formula
           (rounded upward to the nearest 1/100th of 1%):

                                    Eurodollar Base Rate
                        1.00 - Eurocurrency Reserve Requirements

                      "Event of Default": any of the events specified in Section
           7, provided that any requirement for the giving of notice,  the lapse
           of time, or both, or any other condition, has been satisfied.

                     "Excess  Cash Flow":  for any fiscal  year,  the amount (if
           any) by which (a) the sum of (i)  Annualized  Consolidated  Operating
           Cash Flow for such fiscal year plus (ii) any interest income realized
           in cash of the Borrower and its Restricted  Subsidiaries  during such
           fiscal year  exceeds  (b) the sum of (i) Total Debt  Service for such
           fiscal year plus (ii) the  aggregate  amount of Capital  Expenditures
           made by the  Borrower  and its  Restricted  Subsidiaries  during such
           fiscal year (net of long-term  Indebtedness,  if any, incurred by the
           Borrower  and its  Restricted  Subsidiaries  during such fiscal year)
           plus (iii) the  aggregate  amount of income  taxes paid or payable by
           the Borrower  (excluding any such taxes  attributable to the revenues
           of  Unrestricted  Subsidiaries  for which the Borrower has been or is
           entitled to be reimbursed,  or has received or is entitled to receive
           a credit,  pursuant to the terms of any Tax Allocation Agreement) and
           its Restricted Subsidiaries during such fiscal year.

                      "Existing  Credit  Agreement":  as defined in the recitals
           hereto.

                      "Existing Loans": collectively the loans outstanding under
           the Existing Credit Agreement.

                      "Financing  Lease":   any  lease  of  property,   real  or
           personal,  the  obligations  of the  lessee in  respect  of which are
           required in accordance with GAAP to be capitalized on a balance sheet
           of the lessee.

                      "First Unrestricted  Basket": at any time, an amount equal
           to the  sum of (a)  $50,000,000  plus  (b)  the  aggregate  net  cash
           proceeds received by the Borrower subsequent to the Closing Date from
           the issuance of shares of its Capital Stock.

                      "Foreign  Subsidiary":  any  Subsidiary  of  the  Borrower
           organized  under  the laws of any  jurisdiction  outside  the  United
           States.

                      "GAAP":  generally accepted  accounting  principles in the
           United States consistent with those utilized in preparing the audited
           financial statements referred to in subsection 4.1.



<PAGE>

                                        9

                      "Governmental  Authority":  any nation or government,  any
           state  or  other  political   subdivision   thereof  and  any  entity
           exercising   executive,   legislative,    judicial,   regulatory   or
           administrative functions of or pertaining to government.

                      "Guarantee": the guarantee to be executed and delivered by
           each  Restricted   Subsidiary   other  than  a  Foreign   Subsidiary,
           substantially  in the form of Exhibit C, as the same may be  amended,
           supplemented or otherwise modified from time to time.

                     "Guarantee Obligation": as to any Person (the "guaranteeing
           person"),  any  obligation  of (a)  the  guaranteeing  person  or (b)
           another  Person  to induce  the  creation  of which the  guaranteeing
           person  has  issued  a  reimbursement,  counterindemnity  or  similar
           obligation, in either case guaranteeing or in effect guaranteeing any
           Indebtedness,  leases,  dividends or other  obligations (the "primary
           obligations")  of any other third Person (the  "primary  obligor") in
           any  manner,  whether  directly  or  indirectly,  including,  without
           limitation, any obligation of the guaranteeing person, whether or not
           contingent,  (i) to  purchase  any  such  primary  obligation  or any
           property  constituting direct or indirect security therefor,  (ii) to
           advance or supply  funds (1) for the  purchase or payment of any such
           primary  obligation  or (2) to  maintain  working  capital  or equity
           capital of the primary obligor or otherwise to maintain the net worth
           or  solvency  of the primary  obligor,  (iii) to  purchase  property,
           securities  or services  primarily  for the  purpose of assuring  the
           owner of any such  primary  obligation  of the ability of the primary
           obligor to make payment of such primary  obligation or (iv) otherwise
           to assure or hold  harmless the owner of any such primary  obligation
           against loss in respect  thereof;  provided,  however,  that the term
           Guarantee  Obligation  shall not include  endorsements of instruments
           for deposit or  collection  in the ordinary  course of business.  The
           amount of any Guarantee  Obligation of any guaranteeing  person shall
           be deemed to be the  lower of (a) an  amount  equal to the  stated or
           determinable  amount of the  primary  obligation  in respect of which
           such  Guarantee  Obligation  is made and (b) the  maximum  amount for
           which such guaranteeing person may be liable pursuant to the terms of
           the  instrument  embodying  such  Guarantee  Obligation,  unless such
           primary obligation and the maximum amount for which such guaranteeing
           person may be liable are not  stated or  determinable,  in which case
           the amount of such Guarantee  Obligation  shall be such  guaranteeing
           person's maximum reasonably  anticipated liability in respect thereof
           as determined by the Borrower in good faith.

                     "Guarantor":  any Person party to the Guarantee.

                      "Incentive  Warrants":  shall  mean  the  Stock  Incentive
           Option as defined in the Management  Agreement  (comprising  warrants
           each for 500,000 shares of the  Borrower's  common stock to be issued
           to INI pursuant to the Management Agreement).

                      "Indebtedness":   of  any  Person  at  any  date,  without
           duplication,  (a) all  indebtedness of such Person for borrowed money
           or for the  deferred  purchase  price of property or services  (other
           than trade  liabilities  incurred in the ordinary  course of business
           and payable in accordance  with customary  practices),  (b) any other
           indebtedness  of such  Person  which is  evidenced  by a note,  bond,
           debenture or similar  instrument,  (c) all obligations of such Person



<PAGE>

                                       10

           under Financing Leases, (d) all obligations of such Person contingent
           or   otherwise  in  respect  of  banker's   acceptances   or  similar
           instruments issued or created for the account of such Person, (e) all
           obligations,  contingent or  otherwise,  of such Person as an account
           party under  acceptance,  letter of credit or similar  facilities and
           (f) all  liabilities of the type described in clauses (a) through (e)
           above  secured by any Lien on any property  owned by such Person (not
           to exceed the value of such property) even though such Person has not
           assumed or otherwise become liable for the payment thereof.

                      "Infinity":  Infinity Broadcasting Corporation, a Delaware
           corporation.

                      "Infinity   Agreements":   collectively,   the  Management
           Agreement and the Voting Agreement.

                     "INI":  (a) Infinity  Network Inc., a Delaware  corporation
           that, on the date hereof,  is a wholly owned  Subsidiary of Infinity,
           or (b) any  other  wholly  owned  Subsidiary  of  Infinity  that owns
           Capital Stock or other ownership interests of the Borrower;  provided
           that  Infinity  shall have notified the  Administrative  Agent of the
           name of  such  other  Subsidiary  and the  amount  of such  ownership
           interests owned by such Subsidiary.

                      "Insolvency":  with respect to any Multiemployer Plan, the
           condition  that such Plan is insolvent  within the meaning of Section
           4245 of ERISA.

                     "Insolvent":  pertaining to a condition of Insolvency.

                     "Installment Date":  as defined in subsection 2.7(a).

                     "Interest  Payment Date":  (a) as to any ABR Loan, the last
           day of  each  March,  June,  September  and  December,  (b) as to any
           Eurodollar  Loan having an Interest  Period of three  months or less,
           the last day of such Interest  Period,  and (c) as to any  Eurodollar
           Loan having an Interest  Period  longer than three  months,  each day
           which is three months, or a whole multiple  thereof,  after the first
           day of such Interest Period and the last day of such Interest Period.

                     "Interest Period":  with respect to any Eurodollar Loan:

                               (a)  initially,  the  period  commencing  on  the
                     borrowing  or  conversion  date,  as the case may be,  with
                     respect to such  Eurodollar Loan and ending one, two, three
                     or six months  thereafter,  as selected by the  Borrower in
                     its notice of  borrowing  or notice of  conversion,  as the
                     case may be, given with respect thereto; and

                                 (b) thereafter,  each period  commencing on the
                      last day of the next preceding  Interest Period applicable
                      to such  Eurodollar Loan and ending one, two, three or six
                      months   thereafter,   as  selected  by  the  Borrower  by
                      irrevocable  notice to the  Administrative  Agent not less
                      than three Business Days prior to the last day of the then
                      current Interest Period with respect thereto;



<PAGE>

                                       11


                      provided that, all of the foregoing provisions relating to
                      Interest Periods are subject to the following:

                                 (i)  if any  Interest  Period  pertaining  to a
                      Eurodollar Loan would otherwise end on a day that is not a
                      Business Day,  such  Interest  Period shall be extended to
                      the next succeeding Business Day unless the result of such
                      extension  would be to carry  such  Interest  Period  into
                      another calendar month in which event such Interest Period
                      shall end on the immediately preceding Business Day;

                                 (ii) any Interest  Period that would  otherwise
                      extend  beyond  the  Termination  Date or beyond  the date
                      final  payment is due on the Term  Loans  shall end on the
                      Termination  Date or such  date of final  payment,  as the
                      case may be;

                                 (iii)  any  Interest  Period  pertaining  to  a
                      Eurodollar  Loan that begins on the last Business Day of a
                      calendar  month  (or  on a  day  for  which  there  is  no
                      numerically corresponding day in the calendar month at the
                      end of  such  Interest  Period)  shall  end  on  the  last
                      Business Day of a calendar month; and

                                 (iv) the Borrower shall select Interest Periods
                      so as  not to  require  a  payment  or  prepayment  of any
                      Eurodollar Loan during an Interest Period for such Loan.

                      "Interest Rate Protection  Agreement":  for any Person, an
           interest rate swap,  cap or collar  agreement or similar  arrangement
           between  such Person and a financial  institution  providing  for the
           transfer or  mitigation of interest  risks either  generally or under
           specific contingencies.

                     "Investment":  as defined in subsection 6.8.

                     "Lien": any mortgage,  pledge,  hypothecation,  assignment,
           deposit arrangement,  encumbrance,  lien (statutory or other), charge
           or other  security  interest  or any  preference,  priority  or other
           security agreement or preferential  arrangement of any kind or nature
           whatsoever  (including,  without limitation,  any conditional sale or
           other  title  retention  agreement  and any  Financing  Lease  having
           substantially the same economic effect as any of the foregoing).

                      "Loan": any loan or advance made by any Lender pursuant to
           this Agreement.

                      "Loan  Documents":  this  Agreement,  any  Notes  and  the
           Guarantee.

                      "Loan  Parties":  the Borrower and each  Subsidiary of the
           Borrower which is a party to a Loan Document.


<PAGE>

                                       12


                     "Majority  Lenders":  at any time prior to the satisfaction
           of the  conditions  precedent  set  forth  in  subsection  4.1 on the
           Closing  Date,   Lenders   having  at  least  51%  of  the  aggregate
           Commitments;  and,  at any  time  thereafter,  Lenders  having  total
           exposure consisting of Term Loans and Revolving Credit Commitments in
           an aggregate  amount of at least 51% of an amount equal to the sum of
           (a) the aggregate Term Loans then  outstanding plus (b) the aggregate
           Revolving Credit Commitments or, at any time after the termination or
           expiration of the Revolving Credit Commitments,  Lenders having total
           exposure  consisting of Term Loans and  Revolving  Credit Loans in an
           aggregate amount of at least 51% of an amount equal to the sum of (x)
           the  aggregate  Term Loans then  outstanding  plus (y) the  aggregate
           Revolving Credit Loans then outstanding.

                     "Majority  Revolving Credit Lenders":  at any time prior to
           the expiration or termination  of the Revolving  Credit  Commitments,
           Lenders  having an aggregate  Applicable  Percentage of at least 51%;
           or, at any time after the  expiration or termination of the Revolving
           Credit Commitments, Lenders having total exposure of Revolving Credit
           Loans in an amount of at least 51% of the aggregate  Revolving Credit
           Loans then outstanding.

                     "Majority  Term   Lenders":   at  any  time  prior  to  the
           satisfaction of the conditions  precedent set forth in subsection 4.1
           on the Closing  Date,  Lenders  having at least 51% of the  aggregate
           Term Loan Commitments; and at any time thereafter, Lenders holding at
           least 51% of the aggregate Term Loans then outstanding.

                      "Management Agreement":  shall mean a Management Agreement
           between  the  Borrower  and  Infinity  in  substantially  the form of
           Exhibit  A to the  Stock  Purchase  Agreement,  as the same  shall be
           modified and supplemented and in effect from time to time.

                      "Management  Fees":  shall mean, for any period,  fees and
           cash  incentive  bonuses  payable to  Infinity  under the  Management
           Agreement during such period for administrative, management and other
           services performed for the Borrower and its Subsidiaries.

                      "Management Services Subordination Agreement": the Amended
           and   Restated    Management   Services    Subordination    Agreement
           substantially  in the form of Exhibit B, as the same may be  amended,
           supplemented or otherwise modified from time to time.

                      "Mandatory  Reduction  Date":  as  defined  in  subsection
           2.4(b).

                     "Material Adverse Effect": a material adverse effect on (a)
           the business, operations,  property, assets, liabilities or condition
           (financial  or   otherwise)  of  the  Borrower  and  its   Restricted
           Subsidiaries  taken as a whole or (b) the validity or  enforceability
           of this or any of the other Loan  Documents or the rights or remedies
           of the Administrative Agent or the Lenders hereunder or thereunder.



<PAGE>

                                       13


                      "Material   Environmental   Amount":   an  amount  finally
           determined to be payable by the Borrower  and/or its  Subsidiaries in
           excess  of  $1,000,000   for  remedial   costs,   compliance   costs,
           compensatory  damages,  punitive  damages,  fines,  penalties  or any
           combination thereof.

                     "Materials  of  Environmental  Concern":  any  gasoline  or
           petroleum (including,  without limitation,  crude oil or any fraction
           thereof) or petroleum  products or any hazardous or toxic substances,
           materials  or wastes  defined  or  regulated  as such in or under any
           Environmental   Law,   including,   without   limitation,   asbestos,
           polychlorinated biphenyls and urea-formaldehyde insulation.

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

                     "New Lender":  as defined in subsection 2.21(b).

                     "Non-Excluded Taxes":  as defined in subsection 2.18(a).

                      "Notes":  the collective reference to the Revolving Credit
           Notes and the Term Notes.

                     "Participant":  as defined in subsection 9.6(b).

                      "PBGC":   the   Pension   Benefit   Guaranty   Corporation
           established pursuant to Subtitle A of Title IV of ERISA.

                     "Permitted Additional Indebtedness":  Indebtedness incurred
           by the  Borrower  which  is (i)  unsecured,  (ii) no  portion  of the
           principal of which is required to be repaid,  repurchased  or retired
           prior to October 31, 2004 (other than upon a change of control of the
           Borrower) and (iii) has other terms and conditions  (other than those
           relating to  interest  rate,  fees and  premiums)  which,  taken as a
           whole, are no more restrictive on the Borrower (as determined in good
           faith by the Board of  Directors  of the  Borrower in the exercise of
           its  reasonable  discretion)  than the terms and  conditions  of this
           Agreement  and the 6-3/4%  Debenture  Indenture,  as in effect on the
           date of incurrence  of such  Indebtedness,  provided,  that the Total
           Debt Ratio,  both prior to and after giving effect to the  incurrence
           of such Indebtedness, is less than 4.50:1.00.

                      "Person":   an   individual,   partnership,   corporation,
           business   trust,   joint  stock   company,   trust,   unincorporated
           association, joint venture, Governmental Authority or other entity of
           whatever nature.

                     "Plan":  at a particular  time,  any employee  benefit plan
           which is covered by ERISA and in respect of which the  Borrower  or a
           Commonly  Controlled  Entity is (or, if such plan were  terminated at
           such  time,  would  under  Section  4069 of ERISA be deemed to be) an
           "employer" as defined in Section 3(5) of ERISA.



<PAGE>

                                       14


                      "Properties":  the facilities and properties owned, leased
           or operated by the Borrower or any of its Subsidiaries.

                     "Reference Lenders":  Chase, BOM and BOB.

                     "Register":  as defined in subsection 9.6(d).

                      "Regulation U":  Regulation U of the Board of Governors of
           the Federal Reserve System as in effect from time to time.

                      "Reorganization":  with respect to any Multiemployer Plan,
           the condition that such plan is in reorganization  within the meaning
           of Section 4241 of ERISA.

                      "Reportable Event": any of the events set forth in Section
           4043(b) of ERISA,  other than those events as to which the thirty day
           notice period is waived under  subsections .13, .14, .16, .18, .19 or
           .20 of PBGC Reg. ss. 2615.

                     "Requirement of Law": as to any Person,  the Certificate of
           Incorporation  and  By-Laws  or  other  organizational  or  governing
           documents of such Person, and any law, treaty,  rule or regulation or
           determination  of an  arbitrator  or a court  or  other  Governmental
           Authority,  in each case applicable to or binding upon such Person or
           any of its property or to which such Person or any of its property is
           subject.

                      "Responsible  Officer":  the  Chairman  of the Board,  the
           Co-Chairman of the Board, the chief executive officer,  the president
           or the chief financial officer of the Borrower.

                      "Restricted  Subsidiary":  each Subsidiary of the Borrower
           other than an Unrestricted Subsidiary.

                     "Revolving  Credit  Commitment":  as  to  any  Lender,  the
           obligation  of such  Lender  to make  Revolving  Credit  Loans to the
           Borrower  hereunder in an aggregate  principal amount at any one time
           outstanding not to exceed the amount set forth opposite such Lender's
           name on Schedule I under the heading  "Revolving Credit  Commitment",
           as such amount may be changed  from time to time in  accordance  with
           the provisions of this Agreement.

                      "Revolving  Credit  Loans":  all loans made or deemed made
           pursuant to subsection 2.1.

                     "Revolving Credit Note":  as defined in subsection 2.7(e).

                      "Second Unrestricted Basket": at any time. an amount equal
           to the sum of (a)  any  Excess  Cash  Flow  of the  Borrower  and its
           Restricted  Subsidiaries  for any  fiscal  year  commencing  with the
           fiscal year ending on  December  31, 1999 not  required to be applied
           pursuant to subsection  2.9(a) to the prepayment of the Loans and the
           permanent  reduction of the Revolving Credit Commitments plus (b) the
           aggregate net cash proceeds received by the Borrower subsequent to


<PAGE>

                                       15


           the Closing  Date from the  issuance  of shares of its Capital  Stock
           (net of the amount of any such net cash proceeds expended pursuant to
           subsection  6.7(b)(i) or 6.8(g)(iii)(A)  under the First Unrestricted
           Basket).

                      "Single Employer Plan": any Plan which is covered by Title
           IV of ERISA, but which is not a Multiemployer Plan.

                     "6-3/4%  Debentures":  the 6-3/4% Convertible  Subordinated
           Debentures  Due 2011 of the  Borrower,  as the same shall be modified
           and  supplemented  and in effect from time to time in accordance with
           subsection 6.9.

                     "6-3/4%  Debenture  Indenture":  the Indenture  dated as of
           October 15, 1986 between the Borrower and Security  Pacific  National
           Bank, as Trustee,  providing for the 6-3/4%  Debentures,  as the same
           shall be modified and supplemented and in effect from time to time in
           accordance with subsection 6.9.

                      "Stock Purchase  Agreement":  the Stock Purchase Agreement
           dated as of  November  4, 1993 among  Unistar  Communications  Group,
           Inc., Unistar Radio Networks, Inc., Infinity and the Borrower, as the
           same shall be modified  and  supplemented  and in effect from time to
           time.

                     "Subsidiary": as to any Person, a corporation,  partnership
           or other entity of which shares of stock or other ownership interests
           having  ordinary  voting  power  (other  than  stock  or  such  other
           ownership interests having such power only by reason of the happening
           of a  contingency)  to elect a majority of the board of  directors or
           other managers of such  corporation,  partnership or other entity are
           at  the  time  owned,   or  the  management  of  which  is  otherwise
           controlled,    directly   or   indirectly   through   one   or   more
           intermediaries,  or both, by such Person. Unless otherwise qualified,
           all  references  to a  "Subsidiary"  or  to  "Subsidiaries"  in  this
           Agreement  shall  refer  to  a  Subsidiary  or  Subsidiaries  of  the
           Borrower.

                      "Tax Allocation Agreements": each Tax Allocation Agreement
           substantially  in the form of  Exhibit G  hereto,  each  between  the
           Borrower and an Unrestricted Subsidiary,  as the same may be amended,
           supplemented or otherwise modified from time to time.

                     "Term Loans":  all loans made pursuant to subsection 2.5.

                     "Term Loan  Commitments":  as to any Lender, the obligation
           of such  Lender  to make  Term  Loans to the  Borrower  hereunder  in
           aggregate  principal  amount  not to  exceed  the  amount  set  forth
           opposite such  Lender's  name on Schedule I under the heading  "Total
           Term Loan Commitment".

                     "Term Note":  as defined in subsection 2.7(e).

                     "Termination Date":  September 30, 2004.


<PAGE>


                                       16


                      "Total Debt":  the sum of,  without  duplication,  (a) all
           Indebtedness  (other  than  Indebtedness  in respect  of the  undrawn
           amount of any letters of credit ) of the Borrower and its  Restricted
           Subsidiaries,   determined  on  a  consolidated  basis  and  (b)  all
           Indebtedness  (other  than  Indebtedness  in respect  of the  undrawn
           amount of any  letters of  credit)  of others  for which a  Guarantee
           Obligation   has  been  given  by  the  Borrower  or  any  Restricted
           Subsidiary.

                     "Total  Debt  Ratio":  as  of  any  date  of  determination
           thereof,  the ratio of (a) Total Debt  outstanding as of such date to
           (b) Annualized Consolidated Operating Cash Flow for the period of the
           four fiscal quarters of the Borrower ended on, or most recently ended
           prior to, such date for which financial  statements have been, or are
           required to have been, provided to the Lenders pursuant to subsection
           5.1.

                     "Total Debt Service": as at the last day of any fiscal year
           of the Borrower,  the sum  (calculated  without  duplication)  of all
           payments of principal of and interest on Indebtedness of the Borrower
           and its Restricted  Subsidiaries  made or scheduled to be made during
           such  fiscal year (other  than  payments  of  principal  which may be
           reborrowed), provided that, for any fiscal year ending on or prior to
           the  Termination   Date,  "Total  Debt  Service"  shall  include  all
           mandatory  reductions of the Revolving Credit Commitments pursuant to
           subsection 2.4(b) effected during such fiscal year.

                     "Total  Fixed  Charge  Coverage  Ratio":  as of any date of
           determination  thereof,  the  ratio  of (a)  Annualized  Consolidated
           Operating  Cash Flow for the period of four  fiscal  quarters  of the
           Borrower  ended on, or most recently ended prior to, such date to (b)
           Total Fixed Charges for such period.

                     "Total Fixed Charges": for any period, the sum of (a) Total
           Interest  for such  period  plus (b) all  payments  of  principal  of
           Indebtedness of the Borrower and its Restricted  Subsidiaries made or
           scheduled  to be made  during such  period  (other  than  payments of
           principal   which  may  be   reborrowed),   including  all  mandatory
           reductions of the Revolving Credit Commitments pursuant to subsection
           2.4(b) effected during such period plus (c) Capital Expenditures made
           during such period plus (d) the aggregate amount of income taxes paid
           or payable by the Borrower  (excluding any such taxes attributable to
           the revenues of Unrestricted  Subsidiaries for which the Borrower has
           been or is entitled to be reimbursed,  or has received or is entitled
           to  receive a  credit,  pursuant  to the terms of any Tax  Allocation
           Agreement) and its Restricted Subsidiaries during such fiscal year.

                      "Total Interest":  for any period,  all interest,  whether
           paid  in  cash  or  accrued  as  a  liability,  on  all  Indebtedness
           (including  imputed interest on Financing Leases) of the Borrower and
           its  Restricted  Subsidiaries,  determined on a  consolidated  basis,
           during such period.

                      "Total  Interest  Coverage  Ratio":  as  of  any  date  of
           determination  thereof,  the  ratio  of (a)  Annualized  Consolidated
           Operating  Cash Flow for the period of four  fiscal  quarters  of the
           Borrower  ended on, or most recently ended prior to, such date to (b)
           Total Interest for such period.


<PAGE>

                                       17

                      "Tranche":  the collective  reference to Eurodollar  Loans
           the then current  Interest Periods with respect to all of which begin
           on the same date and end on the same later date  (whether or not such
           Loans shall originally have been made on the same day).

                     "Transferee":  as defined in subsection 9.6(f).

                      "Type":  as to any  Loan,  its  nature as an ABR Loan or a
           Eurodollar Loan.

                     "United States":  the United States of America.

                      "Unrestricted Subsidiary":  any Subsidiary of the Borrower
           which  has been  organized  or  acquired  after the date  hereof  and
           designated   by  the  Board  of  Directors  of  the  Borrower  as  an
           "Unrestricted  Subsidiary",  provided, in each case, that at the time
           any such other  Subsidiary  is so  organized  or acquired  and at all
           times thereafter:

                               (a) none of the issued and outstanding  capital
                      stock  of  such  Subsidiary  (or  any  Subsidiary  of such
                      Subsidiary) is owned by any Restricted Subsidiary;

                               (b) except as permitted by subsection  6.8(g), no
                     proceeds of any Loan  hereunder  are used to finance or pay
                     any cost or  expense  related  to the  organization  of, or
                     acquisition of the assets or properties of, such Subsidiary
                     (or any Subsidiary of such Subsidiary);

                                 (c) except as permitted by  subsection  6.8(g),
                      neither the Borrower nor any  Restricted  Subsidiary is at
                      the  time  such  Subsidiary  (or  any  Subsidiary  of such
                      Subsidiary)  is  organized  or  acquired  or at  any  time
                      thereafter (x) directly or indirectly liable (contingently
                      or otherwise),  or provides or is obligated to provide any
                      credit support, for any Indebtedness  (including,  without
                      limitation,  any  undertaking,   agreement  or  instrument
                      evidencing such  Indebtedness) or other obligation of such
                      Subsidiary  (or any  Subsidiary of such  Subsidiary),  (y)
                      obligated  to  contribute  any funds or other  property to
                      such Subsidiary (or any Subsidiary of such  Subsidiary) or
                      (z)  otherwise  directly or  indirectly  obligated  to any
                      other  Person  on  account  of  the  Indebtedness,   other
                      obligations or financial  condition of such Subsidiary (or
                      any Subsidiary of such Subsidiary) except to the extent of
                      a pledge or security  interest in the Capital  Stock owned
                      by the Borrower of such Subsidiary as collateral  security
                      for  obligations of such  Subsidiary (or any Subsidiary of
                      such Subsidiary);

                                 (d)  no   agreements,   instruments   or  other
                      documents governing or evidencing any Indebtedness of such
                      Subsidiary (or any Subsidiary of such Subsidiary) contains
                      a  cross-default  or  cross-acceleration  clause  or other
                      "event of  default"  or similar  event the  occurrence  of
                      which  (with or  without  notice or lapse of time or both)
                      causes or would permit the holder(s) thereof to cause such
                      Indebtedness  to  become  due  or  to  be  required  to be
                      purchased  or  redeemed by such  Subsidiary  or any of its
                      Affiliates  prior  to  its  stated  maturity  or  to  take
                      enforcement   action  against  such   Subsidiary  (or  any
                      Subsidiary of such Subsidiary) solely by reason of (x) the


<PAGE>

                                       18


                      the occurrence of a Default or Event of Default hereunder,
                      (y) the  occurrence  of any  default  or  other  event  or
                      condition  in  respect  of any other  Indebtedness  of the
                      Borrower or any of its Restricted Subsidiaries (including,
                      without   limitation,   subordinated   debt)  or  (z)  the
                      occurrence  of any event or condition  with respect to the
                      Borrower or any of its Restricted  Subsidiaries other than
                      any event or  condition  described  in  Section  7(f) with
                      respect to the Borrower;

                               (e) the Borrower and such  Subsidiary (or another
                     Unrestricted  Subsidiary  of  which  such  Subsidiary  is a
                     Subsidiary),  acting on its own behalf and on behalf of its
                     Subsidiaries, have entered into a Tax Allocation Agreement,
                     which  Agreement  shall be in full  force and effect at the
                     time such  Subsidiary  is  organized or acquired and at all
                     times thereafter; and

                               (f) the  Borrower  has notified the Lenders as to
                     the  organization  or  acquisition  of such  Subsidiary  as
                     required  by   subsection   5.9  and  the  Borrower  is  in
                     compliance   with  its  other   obligations  set  forth  in
                     subsection 5.9.

                     "Voting  Agreement":  shall mean a Voting Agreement between
the Borrower, Norman J. Pattiz and INI in substantially the form of Exhibit B to
the Stock Purchase Agreement, as the same shall be modified and supplemented and
in effect from time to time.

                     1.2 Other  Definitional  Provisions.  (a) Unless  otherwise
specified  therein,  all terms defined in this Agreement  shall have the defined
meanings  when used in any Notes or any  certificate  or other  document made or
delivered pursuant hereto.

                     (b) As used herein and in any Notes, and any certificate or
other document made or delivered  pursuant hereto,  accounting terms relating to
the Borrower and its  Subsidiaries  not defined in subsection 1.1 and accounting
terms partly  defined in subsection  1.1, to the extent not defined,  shall have
the respective meanings given to them under GAAP.

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

                     (d) The  meanings  given to terms  defined  herein shall be
equally applicable to both the singular and plural forms of such terms.


                   SECTION 2. AMOUNT AND TERMS OF COMMITMENTS

                     2.1 Revolving Credit Commitments.  (a) Subject to the terms
and conditions  hereof,  each Lender  severally  agrees to make revolving credit
loans  ("Revolving  Credit  Loans") to the Borrower from time to time during the
Commitment  Period in an aggregate  principal amount at any one time outstanding
which does not exceed the amount of such


<PAGE>

                                       19


Lender's  Revolving  Credit  Commitment,  provided  that  at no time  shall  the
aggregate principal amount of Revolving Credit Loans exceed the aggregate amount
of the Revolving  Credit  Commitments  as then in effect.  During the Commitment
Period the Borrower  may use the  Revolving  Credit  Commitments  by  borrowing,
prepaying the Revolving Credit Loans in whole or in part, and  reborrowing,  all
in accordance with the terms and conditions hereof.

                     (b) The Revolving Credit Loans may from time to time be (i)
Eurodollar Loans, (ii) ABR Loans or (iii) a combination  thereof,  as determined
by the Borrower  and notified to the  Administrative  Agent in  accordance  with
subsections 2.2 and 2.10,  provided that no Revolving  Credit Loan shall be made
as a  Eurodollar  Loan after the day that is one month prior to the  Termination
Date.

                     2.2 Procedure for Revolving Credit Borrowing.  The Borrower
may borrow under the Revolving Credit  Commitments  during the Commitment Period
on any Business Day,  provided that the Borrower  shall give the  Administrative
Agent  irrevocable  notice (which notice must be received by the  Administrative
Agent prior to 11:30 A.M., New York City time (and 10:00 A.M. New York City time
in the case of any  Revolving  Credit Loans  requested to be made on the Closing
Date), (a) three Business Days prior to the requested  Borrowing Date, if all or
any part of the requested Revolving Credit Loans are to be initially  Eurodollar
Loans, or (b) one Business Day prior to the requested Borrowing Date, otherwise,
specifying  (i) the amount to be borrowed,  (ii) the requested  Borrowing  Date,
(iii)  whether  the  borrowing  is to be of  Eurodollar  Loans,  ABR  Loans or a
combination  thereof  and (iv) if the  borrowing  is to be entirely or partly of
Eurodollar  Loans,  the  respective  amounts  of each  such Type of Loan and the
respective lengths of the initial Interest Periods therefore.  Each borrowing by
the Borrower under the Revolving Credit  Commitments shall be in an amount equal
to (x) in the case of ABR Loans,  $500,000  or a whole  multiple  of $100,000 in
excess thereof (or, if the then Available  Revolving Credit Commitments are less
than  $500,000,  such lesser  amount) and (y) in the case of  Eurodollar  Loans,
$3,000,000 or a whole multiple of $1,000,000 in excess thereof.  Upon receipt of
any such notice  from the  Borrower,  the  Administrative  Agent shall  promptly
notify  each  Lender  thereof.  Each Lender will make the amount of its pro rata
share of each borrowing available to the Administrative Agent for the account of
the Borrower at the office of the  Administrative  Agent specified in subsection
9.2 prior to 11:00 A.M.,  New York City time, on the Borrowing Date requested by
the Borrower in funds immediately  available to the  Administrative  Agent. Such
borrowing  will then be made  available  to the  Borrower by the  Administrative
Agent crediting the account of the Borrower on the books of such office with the
aggregate  of the amounts  made  available  to the  Administrative  Agent by the
Lenders and in like funds as received by the Administrative Agent.

                     2.3  Commitment  Fee.  The  Borrower  agrees  to pay to the
Administrative  Agent for the  account of each Lender a  commitment  fee for the
period  from  and  including  the  first  day of the  Commitment  Period  to the
Termination Date, computed at the rate of 1/4 of 1% per annum on an amount equal
to the sum of (i) such  Lender's  Applicable  Percentage  of the  average  daily
amount of the  Available  Revolving  Credit  Commitments  and (ii) such Lender's
ratable share of the then undrawn and available  Term Loan  Commitments,  during
the  period  for which  payment is made.  Such  commitment  fee shall be payable
quarterly in arrears on the last day of each March, June, September and December


<PAGE>

                                       20


and on the  Termination  Date  or such  earlier  date  as the  Revolving  Credit
Commitments shall terminate as provided herein,  commencing on the first of such
dates to occur after the date hereof.

                     2.4   Termination   or  Reduction   of   Revolving   Credit
Commitments.  (a) The  Borrower  shall  have the  right,  upon not less than one
Business Day's notice to the  Administrative  Agent,  to terminate the Revolving
Credit  Commitments  or from time to time, to reduce the amount of the Revolving
Credit Commitments to an amount not less than the aggregate  principal amount of
Revolving Credit Loans outstanding after giving effect to any prepayments of the
Revolving  Credit  Loans  being  made on the  date of such  reduction.  Any such
reduction  shall  be in an  amount  equal to  $500,000  or a whole  multiple  of
$100,000 in excess  thereof and shall reduce  permanently  the Revolving  Credit
Commitments  then in effect.  Any such reduction  shall also reduce pro rata the
amounts of the then  remaining  mandatory  reductions  specified  in  subsection
2.4(b).

                     (b) The Revolving Credit Commitments shall be automatically
reduced on each of the dates  specified  below  (each,  a  "Mandatory  Reduction
Date"),  commencing on September  30, 1999, by an aggregate  amount equal to the
percentage  set forth  opposite such date  multiplied  by the  Revolving  Credit
Commitments in effect on December 31, 1998:

                                                Percentage of
                             Mandatory         Revolving Credit
                           Reduction Date        Commitments
                           --------------      ----------------

                           September 30, 1999      2.50%
                           December 31, 1999       2.50%
                           March 31, 2000          2.50%
                           June 30, 2000           2.50%
                           September 30, 2000      2.50%
                           December 31, 2000       2.50%
                           March 31, 2001          3.75%
                           June 30, 2001           3.75%
                           September 30, 2001      3.75%
                           December 31, 2001       3.75%
                           March 31, 2002          5.00%
                           June 30, 2002           5.00%
                           September 30, 2002      5.00%
                           December 31, 2002       5.00%
                           March 31, 2003          6.25%
                           June 30, 2003           6.25%
                           September 30, 2003      6.25%
                           December 31, 2003       6.25%
                           March 31, 2004          8.33%
                           June 30, 2004           8.33%
                           September 30, 2004      8.34%


                     (c) If the aggregate then outstanding  principal amounts of
Revolving Credit Loans shall exceed the aggregate amount of the Revolving Credit
Commitments as reduced at any time pursuant to subsection 2.4(b) or 2.9(d),  the


<PAGE>

                                       21


Borrower  shall prepay  Revolving  Credit Loans to the extent  outstanding in an
amount  equal to such  excess.  Each such  prepayment  shall be  accompanied  by
payment of accrued  interest  on the amount  prepaid  plus any  amounts  payable
pursuant to subsection 2.19.

                     2.5 Term Loans. Subject to the terms and conditions hereof,
each Lender  severally  agrees to make term loans (a "Term Loan") on the Closing
Date to the  Borrower in a  principal  amount not to exceed the amount set forth
opposite such Lender's name in Schedule I as its Term Loan Commitment.  The Term
Loans may from time to time be (i) Eurodollar  Loans,  (ii) ABR Loans or (iii) a
combination  thereof,  as  determined  by  the  Borrower  and  notified  to  the
Administrative Agent in accordance with subsections 2.6 and 2.10.

                     2.6 Procedure for Term Loan  Borrowing.  The Borrower shall
give the Administrative  Agent irrevocable notice (which notice must be received
by the  Administrative  Agent prior to 10:00 A.M., New York City time, (i) three
Business  Days prior to the Closing  Date,  if all or any part of the Term Loans
hereunder are to be initially Eurodollar Loans or (ii) one Business Day prior to
the Closing  Date,  otherwise),  specifying  (A) the amount to be borrowed,  (B)
whether the borrowing is to be of Eurodollar  Loans,  ABR Loans or a combination
thereof and (C) if the borrowing is to be entirely or partly  Eurodollar  Loans,
the respective  amounts of each such type of Loan and the respective  lengths of
the  initial  Interest  Periods  therefor.  Upon  receipt  of  such  notice  the
Administrative Agent shall promptly notify each Lender thereof. Each Lender will
make the  amount  of its pro  rata  share of the  Term  Loans  available  to the
Administrative  Agent  for the  account  of the  Borrower  at the  office of the
Administrative  Agent  specified in subsection  9.2 prior to 1:00 P.M., New York
City time, on the Closing Date in Dollars and in funds immediately  available to
the Administrative Agent. The Administrative Agent shall on such date credit the
account of the Borrower on the books of such office of the Administrative  Agent
with the aggregate of the amounts made available to the Administrative  Agent by
the Lenders and in like funds as received by the Administrative Agent.

                     2.7 Repayment of Loans;  Evidence of Debt. (a) The Borrower
hereby  unconditionally  promises  to pay to the  Administrative  Agent  for the
account of each Lender (i) the then unpaid  principal  amount of each  Revolving
Credit  Loan of such Lender on the  Termination  Date (or such  earlier  date on
which the Revolving  Credit Loans become due and payable  pursuant to Section 7)
and (ii) the aggregate  principal amount of the Term Loans of such Lender, in 20
consecutive quarterly installments, payable on each of the dates specified below
(each, an "Installment  Date") in an amount equal to such Lender's ratable share
(based on the then  outstanding  principal amount of the Term Loans then held by
the Lenders) of the amount set forth opposite such date:

                Installment Date                        Amount
                ----------------                        ------

                March 31, 2000                        $2,500,000
                June 30, 2000                         $2,500,000
                September 30, 2000                    $2,500,000
                December 31, 2000                     $2,500,000



<PAGE>

                                       22


                Installment Date                        Amount
                ----------------                        ------

                March 31, 2001                        $2,500,000
                June 30, 2001                         $2,500,000
                September 30, 2001                    $2,500,000
                December 31, 2001                     $2,500,000
                March 31, 2002                        $3,750,000
                June 30, 2002                         $3,750,000
                September 30, 2002                    $3,750,000
                December 31, 2002                     $3,750,000
                March 31, 2003                        $5,000,000
                June 30, 2003                         $5,000,000
                September 30, 2003                    $5,000,000
                December 31, 2003                     $5,000,000
                March 31, 2004                        $6,666,666
                June 30, 2004                         $6,666,666
                September 30, 1994                    $6,666,668


(or the then unpaid  principal  amount of such Term Loans,  on the date that the
Term Loans become due and payable  pursuant to Section 7). The  Borrower  hereby
further agrees to pay interest on the unpaid  principal amount of the Loans from
time to time  outstanding  from the date hereof until payment in full thereof at
the rates per annum, and on the dates, set forth in subsection 2.12.

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

                     (c) The  Administrative  Agent shall  maintain the Register
pursuant to  subsection  9.6(d),  and a subaccount  therein for each Lender,  in
which shall be recorded  (i) the amount of each  Revolving  Credit Loan and Term
Loan made hereunder,  the Type thereof, each Interest Period 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) both the amount
of any sum received by the Administrative  Agent hereunder from the Borrower and
each Lender's share thereof.

                     (d) The entries  made in the  Register  and the accounts of
each  Lender  maintained  pursuant to  subsection  2.7(b)  shall,  to the extent
permitted  by  applicable  law, be prima facie  evidence  of the  existence  and
amounts of the obligations of the Borrower therein recorded;  provided, however,
that the  failure  of any Lender or the  Administrative  Agent to  maintain  the
Register  or any such  account,  or any error  therein,  shall not in any manner
affect the  obligation of the Borrower to repay (with  applicable  interest) the
Loans made to such Borrower by such Lender in accordance  with the terms of this
Agreement.

                     (e) The  Borrower  agrees  that,  upon the  request  to the
Administrative  Agent by any Lender,  the  Borrower  will execute and deliver to
such Lender (i) a  promissory  note of the  Borrower  evidencing  the  Revolving


<PAGE>

                                       23

Credit  Loans of such  Lender,  substantially  in the form of  Exhibit  A-1 with
appropriate  insertions  as to date and principal  amount (a  "Revolving  Credit
Note"),  and/or (ii) a promissory note of the Borrower  evidencing the Term Loan
of such  Lender,  substantially  in the form of  Exhibit  A-2  with  appropriate
insertions as to date and principal amount (a "Term Note").

                     2.8 Optional Prepayments. The Borrower may, on the last day
of any Interest Period with respect thereto, in the case of Eurodollar Loans, or
at any time and from time to time,  in the case of ABR Loans,  prepay the Loans,
in whole  or in part,  without  premium  or  penalty,  upon at least  (i)  three
Business Days' irrevocable  notice to the  Administrative  Agent, in the case of
Eurodollar  Loans  or  (ii)  one  Business  Day's  irrevocable   notice  to  the
Administrative  Agent, in the case of ABR Loans,  specifying the date and amount
of prepayment and whether the prepayment is of Eurodollar  Loans, ABR Loans or a
combination  thereof,  and, if of a combination thereof, the amount allocable to
each.  Upon receipt of any such notice the  Administrative  Agent shall promptly
notify each Lender  thereof.  In the case of prepayments of the Term Loans only,
such  prepayments  shall be accompanied  by payment of accrued  interest to such
date on the amount  prepaid.  Partial  prepayments  of the Term  Loans  shall be
applied to the  installments of principal  thereof in the inverse order of their
scheduled  maturities,  provided that if the Borrower so elects by notice to the
Administrative Agent, all or any portion of an optional prepayment of any amount
otherwise  required to be applied to the  installments  of the Term Loans in the
inverse order of their  maturities  shall instead be applied to the installments
of the Term Loans, first in the direct order of their maturities, so long as the
installments  to which such  application  is to be made are scheduled to be paid
within 270 days of such optional prepayment and second in inverse order of their
maturities and provided further that any optional prepayments of Term Loans made
prior to September 30, 1999 shall, be applied first to the  installments  due as
specified  above on September  30, 1999,  December 30, 1999,  March 31, 2000 and
June  30,  2000  in  the  direct  order  of  their  maturities  until  all  such
installments  shall be paid in full and second to such  installments  in inverse
order of their maturities.  Amounts prepaid on account of the Term Loans may not
be reborrowed. Each partial prepayment shall be in an amount equal to (i) in the
case of ABR Loans,  $500,000 or a whole  multiple of $100,000 in excess  thereof
and (ii) in the case of  Eurodollar  Loans,  $1,000,000  or a whole  multiple of
$1,000,000 in excess thereof.

                     2.9 Mandatory  Prepayments and Commitment  Reductions.  (a)
If, for any fiscal  year,  commencing  with the fiscal year ending  December 31,
2000,  there  shall be Excess  Cash  Flow for the  Borrower  and its  Restricted
Subsidiaries, by May 31 of the following fiscal year the Borrower shall apply an
amount  equal to 50% of  Excess  Cash  Flow for such  prior  fiscal  year to the
prepayment of the Loans and to the permanent  reduction of the Revolving  Credit
Commitments in accordance with subsection 2.9(d).

                     (b) If the Borrower or any of its  Restricted  Subsidiaries
shall  receive  any net cash  proceeds  from the  sale or other  disposition  of
property,  businesses or assets (except for (i) sales or other  dispositions  of
obsolete or worn out property  and (ii) sales of inventory or other  property in
the  ordinary  course of  business)  and such  proceeds are not used to purchase
other assets within 12 months of receipt  thereof,  the Borrower  shall apply an
amount equal to 100% of the portion of such net cash proceeds not so used to the
prepayment of the Loans and to the permanent  reduction of the Revolving  Credit
Commitments in accordance with subsection 2.9(d).


<PAGE>

                                       24


           (c) If the  Borrower  or any  of its  Restricted  Subsidiaries  shall
receive any proceeds  from any  insurance on the property of the Borrower or its
Restricted Subsidiaries (other than business interruption  insurance),  then the
Borrower  shall  apply  100%  of  such  proceeds,  to the  extent  they  are not
reasonably  promptly  applied  to the  repair  or  replacement  of the  affected
property  to which such  proceeds  relate  (or to the  payment of taxes or other
expenses related to such property or the repayment of any  Indebtedness  secured
thereby),  to the prepayment of the Loans and to the permanent  reduction of the
Revolving Credit Commitments in accordance with subsection 2.9(d).

           (d) Each  prepayment  of the Loans  and  permanent  reduction  of the
Revolving Credit Commitments pursuant to this subsection shall be applied first,
to the permanent  repayment of the Term Loans  (ratably among them in accordance
with the respective aggregate then outstanding principal amounts thereof) in the
inverse order of their scheduled maturities (except that any prepayment pursuant
to  subsection  2.9(b)  shall be  applied  ratably to such  remaining  scheduled
installments)  and second,  to the permanent  reduction of the Revolving  Credit
Commitments and, to the extent required by subsection  2.4(c), to the prepayment
of  Revolving  Credit  Loans.  Each  such  reduction  of  the  Revolving  Credit
Commitments shall reduce, in inverse order, the mandatory reductions required on
each Mandatory Reduction Date except that any such reduction of Revolving Credit
Commitments  pursuant to  subsection  2.9(b) shall reduce pro rata the mandatory
reductions then required on each remaining  Mandatory  Reduction Date. Each such
prepayment  shall be  accompanied  by payment of accrued  interest on the amount
prepaid plus any amounts payable pursuant to subsection 2.19.

           (e) Notwithstanding  anything in this subsection to the contrary: (i)
no  prepayment of Loans or Revolving  Credit  Commitment  reduction  pursuant to
either  paragraph  (b) or (c) above  shall be required to be made until the last
Business Day of December of the then current  fiscal year of the Borrower or, if
earlier,  the date on which the  aggregate  of the amounts to be applied to such
prepayment  and/or  reduction in such fiscal year as provided in such paragraphs
(b) and (c)  equals or exceeds  $1,000,000,  after  which date all such  amounts
received  during  such fiscal  year shall be applied to such  prepayment  and/or
reduction as therein  provided;  and (ii) if the Borrower so elects by notice to
the Administrative Agent no later than 15 Business Days prior to any date that a
prepayment of Eurodollar  Loans would be required to be made but for this clause
(ii), no prepayment of Eurodollar  Loans  pursuant to this  subsection  shall be
required  to be made  except  on the  last  day(s)  of the  respective  Interest
Period(s)  therefor in effect at the time such  prepayments  would  otherwise be
required to be made  provided,  that on any date that a prepayment of Eurodollar
Loans would be required to be made but for this  subsection  the Borrower  shall
cash-collateralize  such  payment  in a manner  reasonably  satisfactory  to the
Administrative Agent.

                     2.10 Conversion and Continuation  Options. (a) The Borrower
may elect from time to time to convert  Eurodollar Loans to ABR Loans, by giving
the Administrative Agent at least one Business Day's prior irrevocable notice of
such election, provided that any such conversion of Eurodollar Loans may only be
made on the last day of an Interest  Period with respect  thereto.  The Borrower
may elect from time to time to convert ABR Loans to  Eurodollar  Loans by giving


<PAGE>

                                       25


the Administrative  Agent at least three Business Days' prior irrevocable notice
of such  election.  Any such  notice of  conversion  to  Eurodollar  Loans shall
specify the length of the initial Interest Period or Interest Periods  therefor.
Upon receipt of any such notice the  Administrative  Agent shall promptly notify
each Lender  thereof.  All or any part of outstanding  Eurodollar  Loans and ABR
Loans may be  converted  as provided  herein,  provided  that (i) no Loan may be
converted  into a Eurodollar  Loan when any Event of Default has occurred and is
continuing  and  the  Administrative  Agent  has or the  Majority  Lenders  have
determined  that such a conversion  is not  appropriate  and (ii) no Loan may be
converted  into a Eurodollar  Loan after the date that is one month prior to the
Termination  Date (in the case of  Revolving  Credit  Loans)  or the date of the
final installment of principal of the Term Loans (in the case of Term Loans).

                     (b) Any  Eurodollar  Loan may be continued as such upon the
expiration  of the then  current  Interest  Period with  respect  thereto by the
Borrower  giving notice to the  Administrative  Agent,  in  accordance  with the
applicable provisions of the term "Interest Period" set forth in subsection 1.1,
of the  length of the next  Interest  Period  to be  applicable  to such  Loans,
provided that no Eurodollar  Loan may be continued as such (i) when any Event of
Default has occurred and is continuing and the  Administrative  Agent has or the
Majority  Lenders have determined that such a continuation is not appropriate or
(ii) after the date that is one month prior to the Termination Date (in the case
of Revolving Credit Loans) or the date of the final  installment of principal of
the Term Loans (in the case of Term Loans) and  provided,  further,  that if the
Borrower shall fail to give such notice or if such continuation is not permitted
such Loans shall be automatically converted to ABR Loans on the last day of such
then expiring Interest Period.

                     2.11 Minimum  Amounts and Maximum  Number of Tranches.  All
borrowings,  conversions and continuations of Loans hereunder and all selections
of Interest  Periods  hereunder shall be in such amounts and be made pursuant to
such elections so that,  after giving effect  thereto,  the aggregate  principal
amount of the Loans  comprising  each Tranche  shall be equal to $3,000,000 or a
whole multiple of $1,000,000 in excess thereof.  In no event shall there be more
than ten Tranches outstanding at any time.

                     2.12 Interest Rates and Payment Dates.  (a) Each Eurodollar
Loan shall bear interest for each day during each  Interest  Period with respect
thereto at a rate per annum equal to the Eurodollar Rate determined for such day
plus the Applicable Margin.

                     (b) Each ABR Loan shall bear  interest  at a rate per annum
equal to the ABR plus the Applicable Margin.

                     (c) If all or a portion of (i) any  principal  of any Loan,
(ii) any interest  payable  thereon,  (iii) any commitment fee or (iv) any other
amount  payable  hereunder  shall not be paid when due  (whether  at the  stated
maturity, by acceleration or otherwise), the principal of the Loans and any such
overdue interest,  commitment fee or other amount shall, to the extent permitted
by applicable law, bear interest at a rate per annum which is (x) in the case of
principal,  the rate that would otherwise be applicable  thereto pursuant to the
foregoing  provisions of this  subsection plus 2% or (y) in the case of any such
overdue  interest,  commitment  fee or  other  amount,  the  rate  described  in


<PAGE>

                                       26


paragraph  (b) of this  subsection  plus 2%,  in each case from the date of such
non-payment  until such overdue  principal,  interest,  commitment  fee or other
amount is paid in full (as well after as before judgment).

                     (d) Interest  shall be payable in arrears on each  Interest
Payment Date,  provided that interest accruing pursuant to paragraph (c) of this
subsection shall be payable from time to time on demand.

                     2.13  Computation  of Interest and Fees. (a) Whenever it is
calculated on the basis of the Prime Rate,  interest  shall be calculated on the
basis of a 365- (or  366-,  as the  case  may be) day year for the  actual  days
elapsed, and, otherwise, interest and commitment fees shall be calculated on the
basis of a 360-day year for the actual days elapsed.  The  Administrative  Agent
shall  as soon as  practicable  notify  the  Borrower  and the  Lenders  of each
determination  of a Eurodollar  Rate.  Any change in the interest rate on a Loan
resulting  from a change  in the ABR or the  Eurocurrency  Reserve  Requirements
shall  become  effective  as of the opening of business on the day on which such
change becomes effective.  The Administrative Agent shall as soon as practicable
notify the Borrower and the Lenders of the effective date and the amount of each
such change in interest rate.

                     (b)  Each   determination   of  an  interest  rate  by  the
Administrative  Agent  pursuant  to any  provision  of this  Agreement  shall be
conclusive  and  binding  on the  Borrower  and the  Lenders  in the  absence of
manifest error. The Administrative  Agent shall, at the request of the Borrower,
deliver  to  the  Borrower  a  statement  showing  the  quotations  used  by the
Administrative  Agent in  determining  any interest  rate pursuant to subsection
2.12(a) or (c).

                     (c) If any Reference  Lender shall for any reason no longer
have a Revolving  Credit  Commitment or any Loans,  such Reference  Lender shall
thereupon cease to be a Reference Lender, and if, as a result,  there shall only
be one Reference Lender remaining,  the Administrative Agent (after consultation
with the  Borrower  and the  Lenders)  shall,  by notice to the Borrower and the
Lenders,  designate  another Lender as a Reference Lender so that there shall at
all times be at least two Reference Lenders.

                     (d) Each  Reference  Lender  shall use its best  efforts to
furnish quotations of rates to the Administrative  Agent as contemplated hereby.
If any of the  Reference  Lenders  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 subsection  2.18, be determined on
the basis of the  quotations  of the  remaining  Reference  Lenders or Reference
Lender.

                     2.14 Inability to Determine  Interest Rate. If prior to the
first day of any Interest Period:

                     (a) the Administrative  Agent shall have determined in good
           faith (which  determination  shall be conclusive and binding upon the
           Borrower)  that,  by reason of  circumstances  affecting the relevant
           market,  adequate and reasonable  means do not exist for ascertaining
           the Eurodollar Rate for such Interest Period, or


<PAGE>

                                       27


                     (b) the  Administrative  Agent shall have  received  notice
           from the Majority  Lenders that the Eurodollar  Rate determined or to
           be determined for such Interest Period will not adequately and fairly
           reflect the cost to such Lenders (as  conclusively  certified by such
           Lenders) of making or  maintaining  their  affected Loans during such
           Interest Period,

the Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as  practicable  thereafter.  If such notice is
given (x) any  Eurodollar  Loans  requested  to be made on the first day of such
Interest Period shall be made as ABR Loans, (y) any Loans that were to have been
converted on the first day of such Interest Period to Eurodollar  Loans shall be
converted to or continued as ABR Loans and (z) any outstanding  Eurodollar Loans
shall be  converted,  on the first day of such  Interest  Period,  to ABR Loans.
Until such notice has been  withdrawn by the  Administrative  Agent,  no further
Eurodollar Loans shall be made or continued as such, nor shall the Borrower have
the right to convert Loans to Eurodollar Loans.

                     2.15 Pro Rata Treatment and Payments. (a) Each borrowing by
the Borrower  from the Lenders  hereunder  and any  reduction  of the  Revolving
Credit Commitments shall be made pro rata according to the respective Applicable
Percentages  of the  Lenders.  Except as provided in  subsection  2.20(b),  each
payment  (including each  prepayment) by the Borrower on account of principal of
and interest on (i) the Revolving  Credit Loans shall be made pro rata according
to the respective  outstanding  principal  amounts of the Revolving Credit Loans
then  held by the  Lenders  and  (ii)  the  Term  Loans  shall  be made pro rata
according to the respective outstanding principal amounts of the Term Loans then
held by the Lenders.  All  payments  (including  prepayments)  to be made by the
Borrower  hereunder,  whether  on  account  of  principal,   interest,  fees  or
otherwise, shall be made without set off or counterclaim and shall be made prior
to 12:00 Noon, New York City time, on the due date thereof to the Administrative
Agent,  for the account of the Lenders,  at the  Administrative  Agent's  office
specified in subsection 9.2, in Dollars and in immediately  available funds. The
Administrative Agent shall distribute such payments to the Lenders promptly upon
receipt in like funds as  received.  If any  payment  hereunder  becomes due and
payable on a day other than a Business  Day,  such payment  shall be extended to
the next  succeeding  Business  Day, and, with respect to payments of principal,
interest  thereon  shall be  payable at the then  applicable  rate  during  such
extension.

                     (b)  Unless  the  Administrative   Agent  shall  have  been
notified in writing by any Lender prior to a borrowing that such Lender will not
make  the  amount  that  would  constitute  its  Applicable  Percentage  of such
borrowing  available to the Administrative  Agent, the Administrative  Agent may
assume that such Lender is making such amount  available  to the  Administrative
Agent, and the Administrative Agent may, in reliance upon such assumption,  make
available to the  Borrower a  corresponding  amount.  If such amount is not made
available to the Administrative Agent by the required time on the Borrowing Date
therefor,  such Lender shall pay to the  Administrative  Agent, on demand,  such
amount with interest  thereon at a rate equal to the daily average Federal Funds
Effective  Rate for the period until such Lender  makes such amount  immediately
available to the Administrative Agent. A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under this  subsection
shall be conclusive in the absence of manifest error. If such


<PAGE>

                                       28


Lender's  Applicable  Percentage of such  borrowing is not made available to the
Administrative Agent by such Lender within three Business Days of such Borrowing
Date,  the  Administrative  Agent shall also be entitled to recover  such amount
with interest  thereon at the rate per annum  applicable to ABR Loans hereunder,
on demand, from the Borrower.

                     2.16  Illegality.   Notwithstanding   any  other  provision
herein,  if the  adoption of or any change in any  Requirement  of Law or in the
interpretation  or application  thereof shall make it unlawful for any Lender to
make or maintain  Eurodollar  Loans as contemplated  by this Agreement,  (a) the
commitment  of  such  Lender  hereunder  to  make  Eurodollar  Loans,   continue
Eurodollar  Loans as such  and  convert  ABR  Loans to  Eurodollar  Loans  shall
forthwith  be  cancelled  and  (b)  such  Lender's  Loans  then  outstanding  as
Eurodollar  Loans, if any, shall be converted  automatically to ABR Loans on the
respective last days of the then current  Interest  Periods with respect to such
Loans or within such earlier  period as required by law. If any such  conversion
of a  Eurodollar  Loan  occurs  on a day  which  is not the last day of the then
current  Interest  Period with respect  thereto,  the Borrower shall pay to such
Lender such amounts, if any, as may be required pursuant to subsection 2.19.

                     2.17  Requirements  of Law.  (a) If the  adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
or compliance by any Lender with any request or directive (whether or not having
the force of law) from any central  bank or other  Governmental  Authority  made
subsequent to the date hereof:

                             (i shall  subject any Lender to any tax of any kind
           whatsoever with respect to this Agreement, any Note or any Eurodollar
           Loan made by it, or change the basis of  taxation of payments to such
           Lender in respect  thereof (except for Non- Excluded Taxes covered by
           subsection  2.18 and  changes in taxes on or  measured by the overall
           net income of such Lender or its lending office for such Loan);

                            (ii  shall  impose,  modify or hold  applicable  any
           reserve,  special  deposit,  compulsory  loan or similar  requirement
           against assets held by,  deposits or other  liabilities in or for the
           account of, advances,  loans or other extensions of credit by, or any
           other acquisition of funds by, any office of such Lender which is not
           otherwise  included  in  the  determination  of the  Eurodollar  Rate
           hereunder; or

                     (iii) shall impose on such Lender any other condition;

and the result of any of the  foregoing  is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining  Eurodollar  Loans or to reduce any amount  receivable
hereunder  in respect  thereof,  then,  in any such  case,  the  Borrower  shall
promptly pay such Lender such  additional  amount or amounts as will  compensate
such Lender for such increased cost or reduced amount receivable.

                     (b) If any Lender shall have  determined  that the adoption
of or any change in any Requirement of Law regarding  capital adequacy or in the
interpretation  or  application  thereof  or  compliance  by such  Lender or any
corporation  controlling  such Lender with any  request or  directive  regarding


<PAGE>

                                       29


capital adequacy  (whether or not having the force of law) from any Governmental
Authority  made  subsequent to the date hereof shall have the effect of reducing
the  rate  of  return  on  such  Lender's  or such  corporation's  capital  as a
consequence of its obligations hereunder to a level below that which such Lender
or such  corporation  could  have  achieved  but for such  adoption,  change  or
compliance  (taking  into  consideration  such  Lender's  or such  corporation's
policies with respect to capital adequacy) by an amount deemed by such Lender to
be material,  then from time to time,  the Borrower  shall  promptly pay to such
Lender such additional amount or amounts as will compensate such Lender for such
reduction.

                     (c) If any Lender becomes  entitled to claim any additional
amounts pursuant to this subsection, it shall promptly notify the Borrower (with
a copy to the  Administrative  Agent)  of the  event by  reason  of which it has
become so entitled.  Each Lender will furnish the  Borrower  with a  certificate
(with a copy to the  Administrative  Agent) setting forth the basis of the claim
and the  additional  amounts  due,  and such  certificate  shall be  conclusive,
provided that the determination of such amounts as set forth on such certificate
is made on a reasonable basis. No Lender shall be entitled to compensation under
this  subsection  for any costs  incurred more than six months prior to the date
such Lender delivers such certificate to the Borrower  requesting  compensation.
The  agreements  in  this  subsection  shall  survive  the  termination  of this
Agreement and the payment of the Loans and all other amounts payable hereunder.

                     2.18 Taxes.  (a) All payments  made by the  Borrower  under
this  Agreement  and any Notes  shall be made free and  clear  of,  and  without
deduction  or  withholding  for or on account of, any present or future  income,
stamp or other taxes, levies,  imposts,  duties,  charges,  fees,  deductions or
withholdings,  now or hereafter imposed, levied, collected, withheld or assessed
by any  Governmental  Authority,  excluding net income taxes and franchise taxes
(imposed in lieu of net income taxes) imposed on the Administrative Agent or any
Lender as a result of a present or former connection  between the Administrative
Agent or such Lender and the jurisdiction of the Governmental Authority imposing
such tax or any political  subdivision  or taxing  authority  thereof or therein
(other than any such connection arising solely from the Administrative  Agent or
such Lender having executed,  delivered or performed its obligations or received
a  payment  under,  or  enforced,  this  Agreement  or any  Note).  If any  such
non-excluded  taxes,  levies,  imposts,  duties,  charges,  fees  deductions  or
withholdings ("Non-Excluded Taxes") are required to be withheld from any amounts
payable to the  Administrative  Agent or any Lender hereunder or under any Note,
the  amounts so  payable to the  Administrative  Agent or such  Lender  shall be
increased to the extent necessary to yield to the  Administrative  Agent or such
Lender  (after  payment of all  Non-Excluded  Taxes)  interest or any such other
amounts  payable  hereunder  at the rates or in the  amounts  specified  in this
Agreement,  provided,  however,  that the  Borrower  shall  not be  required  to
increase any such amounts  payable to any Lender that is not organized under the
laws of the United States or a state thereof if such Lender fails to comply with
the requirements of paragraph (b) of this subsection.  Whenever any Non-Excluded
Taxes are payable by the Borrower, the Borrower shall pay to or deposit with the
appropriate  taxing  authority  in a timely  manner the full  amount of any such
Non-Excluded  Taxes payable and as promptly as possible  thereafter the Borrower
shall send to the Administrative Agent for its own account or for the account of
such  Lender,  as the case  may be, a  certified  copy of an  original  official
receipt received by the Borrower showing payment thereof (or other documentation


<PAGE>

                                       30


reasonably  acceptable to the Administrative  Agent or Lender).  If the Borrower
fails to pay any Non-Excluded Taxes when due to the appropriate taxing authority
or fails to remit to the  Administrative  Agent the  required  receipts or other
required documentary  evidence,  the Borrower shall indemnify the Administrative
Agent and the Lenders for any incremental taxes,  interest or penalties that may
become payable by the Administrative Agent or any Lender as a result of any such
failure. The agreements in this subsection shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.

                     (b) Each Lender that is not incorporated  under the laws of
the United States or a state thereof shall:

                             (i deliver to the Borrower  and the  Administrative
           Agent, on or before the date of any payment by the Borrower hereunder
           or under any Notes to such Lender  with  respect to which such Lender
           requests increased payments pursuant to subsection  2.18(a),  (A) two
           duly completed  copies of United States Internal Revenue Service Form
           1001 or 4224, or successor  applicable  form, as the case may be, and
           (B) an  Internal  Revenue  Service  Form  W-8 or  W-9,  or  successor
           applicable form, as the case may be;

                            (ii deliver to the Borrower  and the  Administrative
           Agent two  further  copies of any such  form or  certification  on or
           before  the date  that  any such  form or  certification  expires  or
           becomes  obsolete and after the  occurrence of any event  requiring a
           change in the most  recent  form  previously  delivered  by it to the
           Borrower; and

                           (iii  obtain such  extensions  of time for filing and
           complete such forms or  certifications as may reasonably be requested
           by the Borrower or the Administrative Agent;

unless in any such case an event (including,  without limitation,  any change in
treaty,  law or  regulation)  has  occurred  prior to the date on which any such
delivery would  otherwise be required which renders all such forms  inapplicable
or which would prevent such Lender from duly  completing and delivering any such
form  with  respect  to it and such  Lender  so  advises  the  Borrower  and the
Administrative  Agent.  Such Lender shall certify (i) in the case of a Form 1001
or 4224,  that it is entitled to receive  payments under this Agreement  without
deduction or  withholding  of any United States federal income taxes and (ii) in
the case of a Form W-8 or W-9,  that it is entitled to an exemption  from United
States  backup  withholding  tax.  Each Person  that shall  become a Lender or a
Participant  pursuant to subsection  9.6 shall,  upon the  effectiveness  of the
related  transfer,  be  required  to  provide  all of the forms  and  statements
required pursuant to this subsection, provided that in the case of a Participant
such  Participant  shall furnish all such required  forms and  statements to the
Lender from which the related participation shall have been purchased.

                     (c) Each Lender that is not incorporated  under the laws of
the United  States or a State  thereof  shall  deliver to the  Borrower  and the
Administrative Agent additional forms or certifications  relating to the matters
provided for in this subsection as may be reasonably requested by the Borrower.


<PAGE>

                                       31


                     2.19  Indemnity.  The  Borrower  agrees to  indemnify  each
Lender and to hold each  Lender  harmless  from any loss or  expense  which such
Lender may sustain or incur as a  consequence  of (a) default by the Borrower in
making a borrowing of, conversion into or continuation of Eurodollar Loans after
the  Borrower  has given a notice  requesting  the same in  accordance  with the
provisions  of this  Agreement,  (b)  default  by the  Borrower  in  making  any
prepayment of a Eurodollar Loan after the Borrower has given a notice thereof in
accordance  with  the  provisions  of  this  Agreement  or (c) the  making  of a
prepayment of Eurodollar Loans on a day which is not the last day of an Interest
Period with respect thereto. Such indemnification may include an amount equal to
the excess,  if any, of (i) the amount of interest  which would have  accrued on
the amount so prepaid,  or not so  borrowed,  converted  or  continued,  for the
period from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such  Interest  Period (or, in the case of a failure
to borrow, convert or continue, the Interest Period that would have commenced on
the date of such  failure) in each case at the  applicable  rate of interest for
such Loans  provided  for herein  (excluding,  however,  the  Applicable  Margin
included  therein,  if any) over  (ii) the  amount of  interest  (as  reasonably
determined  by such Lender) which would have accrued to such Bank on such amount
by placing such amount on deposit for a comparable  period with leading banks in
the interbank  eurodollar market. This covenant shall survive the termination of
this  Agreement  and the  payment  of the Loans and all  other  amounts  payable
hereunder.

                     2.20 Change of Lending Office; Replacement or Prepayment of
Lenders.  (a) Each Lender  agrees that if it makes any demand for payment  under
subsection  2.17 or 2.18(a),  or if any adoption or change of the type described
in  subsection  2.16  shall  occur with  respect  to it, it will use  reasonable
efforts   (consistent   with  its  internal  policy  and  legal  and  regulatory
restrictions and so long as such efforts would not be  disadvantageous to it, as
determined in its sole  discretion)  to designate a different  lending office if
the  making  of such a  designation  would  reduce or  obviate  the need for the
Borrower to make payments under  subsection 2.17 or 2.18(a),  or would eliminate
or reduce the effect of any adoption or change described in subsection 2.16.

                     (b) If the Borrower shall be required to pay any additional
amounts or other payments in accordance  with  subsection  2.17 or 2.18(a) or if
any Lender shall, in accordance with subsection  2.16, no longer be obligated to
make or  maintain  Eurodollar  Loans  hereunder,  the  Borrower  may, at its own
expense  and in its sole  discretion,  (i)  require  such  Lender to transfer or
assign,  in whole or in part,  without  recourse (in accordance  with subsection
9.6), all or part of its interests,  rights and obligations under this Agreement
to another Person (provided that the Borrower, with the full cooperation of such
Lender, can identify a Person which is ready, willing and able to be an Assignee
with  respect  thereto)  which shall  assume such  assigned  obligations  (which
Assignee may be another Lender, if such Assignee Lender accepts such assignment)
or (ii) so long as no  Default or Event of Default  shall have  occurred  and be
continuing,  terminate the Revolving Credit Commitment of such Lender and prepay
all  outstanding  Loans of such  Lender;  provided  that (A) the Assignee or the
Borrower,  as the case may be,  shall  have paid to such  Lender in  immediately
available  funds  the  principal  of and  interest  accrued  to the date of such


<PAGE>

                                       32


payment  on the Loans  made by it  hereunder  and all other  amounts  owed to it
hereunder,   including,  without  limitation,  any  amounts  owing  pursuant  to
subsection 2.19 and, in the case of any such assignment,  any amounts that would
be owing under said  subsection  if such Loans were  prepaid on the date of such
assignment,  and (B) such  assignment or  termination  of the  Revolving  Credit
Commitment,  if any, of such Lender and  prepayment  of Loans does not  conflict
with any law, rule or regulation or order of any Governmental Authority.

                     2.21  Commitment  Increases.  (a) In the event  that at any
time  prior to June 30,  1999 the  Borrower  wishes to  increase  the  aggregate
Revolving Credit Commitments,  it shall notify the Administrative  Agent and the
Lenders of the amount of such  proposed  increase  (such  notice,  a "Commitment
Increase Offer").  Each Commitment  Increase Offer shall offer the Lenders which
have  Revolving  Credit  Commitments  the  opportunity  to  participate  in  the
increased   Revolving  Credit  Commitments  ratably  in  accordance  with  their
respective  Applicable  Percentages.  In the  event  that any  Lender  (each,  a
"Declining  Lender") shall fail to accept in writing a Commitment Increase Offer
within 10 Business Days after receiving  notice  thereof,  all or any portion of
the  proposed  increase  in the  Revolving  Credit  Commitments  offered  to the
Declining Lenders (the aggregate of such offered amounts, the "Declined Amount")
may  instead  be  allocated  to any  one or  more  additional  banks,  financial
institutions or other entities pursuant to paragraph (b) below and/or to any one
or more existing Lenders pursuant to paragraph (c)(ii) below.

                     (b) Any additional bank, financial  institution or of other
entity  which,  with the consent of the  Borrower and the  Administrative  Agent
(which  consent,  in  the  case  of  the  Administrative  Agent,  shall  not  be
unreasonably withheld),  elects to become a party to this Agreement and obtain a
Revolving  Credit  Commitment  in an  amount  equal to all or any  portion  of a
Declined Amount shall execute a New Lender  Supplement with the Borrower and the
Administrative  Agent,  substantially in the form of Exhibit H-1, whereupon such
bank, financial institution or other entity (herein called a "New Lender") shall
become a Lender for all purposes and to the same extent as if originally a party
hereto and shall be bound by and entitled to the benefits of this Agreement, and
Schedule I shall be deemed to be amended  to add the name and  Revolving  Credit
Commitment of such New Lender.

                     (c) Any  Lender  which (i)  accepts a  Commitment  Increase
Offer  pursuant  to  subsection  2.21(a)  and/or  (ii) with the  consent  of the
Borrower,  elects to increase its Revolving Credit Commitment by an amount equal
to all or any  portion  of a Declined  Amount  shall,  in each  case,  execute a
Commitment Increase  Supplement with the Borrower and the Administrative  Agent,
substantially  in the form of Exhibit H-2,  whereupon such Lender shall be bound
by and  entitled to the  benefits  of this  Agreement  with  respect to the full
amount of its Revolving Credit Commitment as so increased,  and Schedule I shall
be deemed to be amended to so increase the Revolving  Credit  Commitment of such
Lender.

                     (d)  If,  on  the  date  upon   which  a  bank,   financial
institution or other entity becomes a New Lender pursuant to subsection  2.21(b)
or upon which a Lender's  Revolving Credit  Commitment is increased  pursuant to
subsection  2.21(a) or (c),  there is an unpaid  principal  amount of  Revolving
Credit Loans,  the Borrower shall borrow Revolving Credit Loans from such Lender
in an amount  determined  by  reference  to the amount of each Type of Revolving
Credit Loan (and, in the case of Eurodollar Loans, of each Tranche) which would


<PAGE>

                                       33


then have been outstanding from such Lender if (i) each such Type or Tranche had
been  borrowed  on the date such bank,  financial  institution  or other  entity
became a Lender or such Lender's  Revolving Credit Commitment was increased,  as
the case may be, in each case after giving effect to such  transaction  and (ii)
the aggregate amount from time to time of each such Type or Tranche requested to
be so borrowed had been increased to the extent  necessary to give effect,  with
respect to such  Lender,  to such  additional  borrowing.  Any  Eurodollar  Loan
borrowed pursuant to the preceding  sentence shall bear interest at such rate or
rates and for such period or periods as may be agreed upon  between the Borrower
and such Lender.

                     (e)  Notwithstanding  anything  to  the  contrary  in  this
subsection,  (i) in no event  shall any  transaction  effected  pursuant to this
subsection  cause the aggregate  amount of the increases in the Revolving Credit
Commitments  pursuant  to  this  subsection  to  exceed  $50,000,000,  (ii)  the
aggregate  amount of any increase in Revolving  Credit  Commitments  pursuant to
subsection  2.21(b) or (c)(ii) shall be limited to the relevant Declined Amount,
(iii) each  Commitment  Increase  Offer shall be for an amount equal to not less
than $20,000,000 and, unless agreed to by the Borrower, no increase in Revolving
Credit  Commitments agreed to, accepted or elected in response to any Commitment
Increase Offer may become  effective unless the aggregate amount of increases so
agreed to, accepted or elected in response to such Commitment  Increase Offer is
not less  than  $20,000,000  and (iv) no Lender  shall  have any  obligation  to
increase its Revolving Credit  Commitment  unless it agrees to do so in its sole
discretion.


                    SECTION 3. REPRESENTATIONS AND WARRANTIES

                     To induce the Administrative Agent and the Lenders to enter
into  this  Agreement  and to make the Loans  and  issue or  participate  in the
Letters  of  Credit,   the  Borrower  hereby  represents  and  warrants  to  the
Administrative Agent and each Lender that:

                     3.1 Financial Condition.  The consolidated balance sheet of
the Borrower and its  consolidated  Subsidiaries as at December 31, 1995 and the
related consolidated  statements of income and of cash flows for the fiscal year
ended on such date,  reported on by Price  Waterhouse  LLP, copies of which have
heretofore  been  furnished  to each  Lender,  present  fairly  in all  material
respects  the  consolidated   financial   condition  of  the  Borrower  and  its
consolidated Subsidiaries as at such date, and the consolidated results of their
operations and their consolidated cash flows for the fiscal year then ended. The
unaudited  consolidated  balance  sheet  of the  Borrower  and its  consolidated
Subsidiaries  as at  June  30,  1996  and  the  related  unaudited  consolidated
statements  of income and of cash flows for the  six-month  period ended on such
date, certified by a Responsible  Officer,  copies of which have heretofore been
furnished  to  each  Lender,   present  fairly  in  all  material  respects  the
consolidated   financial   condition  of  the  Borrower  and  its   consolidated
Subsidiaries as at such date, and the  consolidated  results of their operations
and their  consolidated  cash flows for the six-month period then ended (subject
to  normal  year-end  audit  adjustments  and  footnote  disclosure).  All  such
financial  statements,  including the related schedules and notes thereto,  have
been  prepared in  accordance  with GAAP  applied  consistently  throughout  the
periods involved (except as approved by such accountants or Responsible Officer,
as the case may be, and as disclosed  therein).  Neither the Borrower nor any of


<PAGE>

                                       34


its consolidated  Subsidiaries had, at the date of the most recent balance sheet
referred to above, any material Guarantee  Obligation,  contingent  liability or
liability  for taxes,  or any  long-term  lease or unusual  forward or long-term
commitment, including, without limitation, any interest rate or foreign currency
swap or exchange transaction, which is not reflected in the foregoing statements
or in the notes thereto.  Except as set forth on Schedule 3.1, during the period
from June 30,  1996 to and  including  the date  hereof  there has been no sale,
transfer  or  other  disposition  by the  Borrower  or  any of its  consolidated
Subsidiaries of any material part of its business or property and no purchase or
other  acquisition  of any business or property  (including any capital stock of
any other Person) material in relation to the consolidated  financial  condition
of the Borrower and its consolidated Subsidiaries at June 30, 1996.

                     3.2 No Change.  Since  December  31, 1995 there has been no
development  or event  which has had or could  reasonably  be expected to have a
Material Adverse Effect.

                     3.3 Corporate  Existence;  Compliance with Law. Each of the
Borrower  and its  Restricted  Subsidiaries  (a) is duly  organized  and validly
existing under the laws of the  jurisdiction  of its  organization,  (b) has the
requisite  corporate or other power and authority,  and the legal right,  to own
and operate  its  property,  to lease the  property it operates as lessee and to
conduct the business in which it is currently engaged,  (c) is duly qualified as
a foreign  corporation under the laws of each jurisdiction  where its ownership,
lease or  operation  of property or the conduct of its  business  requires  such
qualification  and (d) is in compliance with all  Requirements of Law, except to
the  extent  that the  inaccuracy  of any of the  statements  set  forth in this
subsection  could  not,  in the  aggregate,  reasonably  be  expected  to have a
Material Adverse Effect.

                     3.4    Corporate    Power;    Authorization;    Enforceable
Obligations.  The Borrower has the corporate power and authority,  and the legal
right,  to make,  deliver and perform the Loan  Documents to which it is a party
and to  borrow  hereunder  and has  taken  all  necessary  corporate  action  to
authorize the  borrowings on the terms and  conditions  of this  Agreement,  any
Notes and to  authorize  the  execution,  delivery and  performance  of the Loan
Documents to which it is a party. No consent or  authorization  of, filing with,
notice to or other act by or in respect of, any Person is required in connection
with the  borrowings  hereunder or with the  execution,  delivery,  performance,
validity or  enforceability  of the Loan  Documents  to which the  Borrower is a
party,  except for filings of  appropriate  counterparts  of this  Agreement and
other  information  with the Securities  and Exchange  Commission as required by
applicable  law. This  Agreement has been, and each other Loan Document to which
it is a party will be, duly  executed and  delivered on behalf of the  Borrower.
This Agreement constitutes,  and each other Loan Document to which it is a party
when  executed  and  delivered  will  constitute,  a legal,  valid  and  binding
obligation of the Borrower  enforceable  against the Borrower in accordance with
its  terms,  subject  to  the  effects  of  bankruptcy,  insolvency,  fraudulent
conveyance,  reorganization,  moratorium  and other  similar laws relating to or
affecting  creditors' rights generally,  general equitable  principles  (whether
considered in a proceeding in equity or at law) and an implied  covenant of good
faith and fair dealing.

                     3.5 No Legal Bar. The execution,  delivery and  performance
of the Loan Documents to which the Borrower is a party, the borrowings hereunder
and the use of the proceeds  thereof will not violate any  Requirement of Law or


<PAGE>

                                       35


Contractual Obligation of the Borrower or of any of its Restricted Subsidiaries,
except for any such  violation  that could not  reasonably be expected to have a
Material  Adverse  Effect,  and will not result in, or require,  the creation or
imposition of any Lien on any of its or their respective  properties or revenues
pursuant to any such Requirement of Law or Contractual Obligation.

                     3.6 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental  Authority is pending or,
to the knowledge of the  Borrower,  threatened by or against the Borrower or any
of its  Restricted  Subsidiaries  or  against  any of  its or  their  respective
properties  or  revenues  (a) which is so  pending  or  threatened  prior to the
Closing  Date  with  respect  to  any  of  the  Loan  Documents  or  any  of the
transactions  contemplated  hereby or thereby,  or (b) which could reasonably be
expected to have a Material Adverse Effect.

                     3.7  No  Default.  Neither  the  Borrower  nor  any  of its
Restricted  Subsidiaries  is in  default  under  or with  respect  to any of its
Contractual  Obligations  in any respect  which could  reasonably be expected to
have a Material Adverse Effect.  No Default or Event of Default has occurred and
is continuing.

                     3.8 Ownership of Property;  Liens. Each of the Borrower and
its Restricted  Subsidiaries  has good record and marketable title in fee simple
to, or a valid leasehold interest in, all its real property,  and good title to,
or a valid  leasehold  interest  in,  all its other  property,  and none of such
property is subject to any Lien except as permitted by subsection 6.3.

                     3.9  Intellectual  Property.  The  Borrower and each of its
Restricted Subsidiaries owns, or is licensed to use, all trademarks, tradenames,
copyrights,  technology, know-how and processes necessary for the conduct of its
business as currently  conducted  except for those the failure to own or license
which could not  reasonably be expected to have a Material  Adverse  Effect (the
"Intellectual  Property").  No claim has been  asserted  and is  pending  by any
Person  challenging or questioning the use of any such Intellectual  Property or
the validity or  effectiveness  of any such  Intellectual  Property  which could
reasonably be expected to have a Material  Adverse  Effect.  To the knowledge of
the  Borrower,  the use of such  Intellectual  Property by the  Borrower and its
Restricted  Subsidiaries  does not infringe on the rights of any Person,  except
for such claims and infringements  that, in the aggregate,  could not reasonably
be expected to have a Material Adverse Effect.

                     3.10  Taxes.  Each  of  the  Borrower  and  its  Restricted
Subsidiaries  has  filed or caused to be filed  all tax  returns  which,  to the
knowledge of the Borrower, are required to be filed and has paid all taxes shown
to be due and payable on said returns or on any  assessments  made against it or
any of its property and all other taxes,  fees or other charges imposed on it or
any of its property by any Governmental Authority (other than any taxes, fees or
other charges the amount or validity of which are currently  being  contested in
good faith by  appropriate  proceedings  and with  respect to which  reserves in
conformity  with GAAP have been  provided  on the books of the  Borrower  or its
Restricted  Subsidiaries,  as the case may be); no tax Lien has been filed, and,
to the knowledge of the Borrower,  no claim is being  asserted,  with respect to
any such tax, fee or other charge.



<PAGE>

                                       36


                     3.11  Federal  Regulations.  No part of the proceeds of any
Loans  will  be used  for any  purpose  that  would  result  in a  violation  of
Regulation G or  Regulation  U of the Board of Governors of the Federal  Reserve
System as now and from time to time hereafter in effect.

                     3.12 ERISA.  (i) During the  five-year  period prior to the
date on which this  representation is made or deemed made,  neither a Reportable
Event nor an "accumulated funding deficiency" (within the meaning of Section 412
of the Code or Section  302 of ERISA) has  occurred  with  respect to any Single
Employer  Plan,  (ii) each Plan has complied in all material  respects  with the
applicable  provisions of ERISA and the Code (except  that,  with respect to any
Multiemployer   Plan,  such  representation  is  only  made  to  the  Borrower's
knowledge), (iii) no termination of a Single Employer Plan has occurred, (iv) no
Lien on the assets of the Borrower or any Commonly Controlled Entity in favor of
the PBGC or a Plan  has  arisen,  (v)  neither  the  Borrower  nor any  Commonly
Controlled  Entity has had nor, to the  Borrowers  knowledge,  expects to have a
complete or partial  withdrawal  from any  Multiemployer  Plan, and (vi) no such
Multiemployer Plan is in Reorganization or Insolvent,  except for the occurrence
of any such event or, in the case of clause (ii), any failure so to comply, that
could reasonably be expected to result in a Material Adverse Effect. The present
value of all accrued  benefits  under each Single  Employer Plan (based on those
assumptions  used to fund such Plans) did not,  as of the last annual  valuation
date  prior to the date on which  this  representation  is made or deemed  made,
exceed the value of the assets of such Plan  allocable to such accrued  benefits
by an amount which could be reasonably  expected to result in a Material Adverse
Effect.

                     3.13  Investment  Company  Act;  Other   Regulations.   The
Borrower  is  not an  "investment  company",  or a  company  "controlled"  by an
"investment company",  within the meaning of the Investment Company Act of 1940,
as amended. The Borrower is not subject to regulation under any Federal or State
statute or regulation  (other than Regulation X of the Board of Governors of the
Federal Reserve System) which limits its ability to incur Indebtedness.

                     3.14  Subsidiaries.  All of the Restricted  Subsidiaries of
the  Borrower in  existence  on the date hereof are listed on Part I of Schedule
3.14, and all of the  Unrestricted  Subsidiaries of the Borrower in existence on
the date hereof are listed on Part II of Schedule 3.14.

                     3.15 Purpose of Loans. The proceeds of the Term Loans shall
be used by the Borrower to  refinance  Indebtedness  under the  Existing  Credit
Agreement.  The  proceeds  of the  Revolving  Credit  Loans shall be used by the
Borrower (i) to refinance Indebtedness under the Existing Credit Agreement, (ii)
to make  acquisitions and (iii) for general  corporate  purposes,  including the
repurchase of shares of Capital Stock and/or evidences of Indebtedness,  working
capital and capital expenditures.

                     3.16 Environmental Matters. Other than exceptions to any of
the following that could not, individually or in any aggregation,  reasonably be
expected  to give  rise to a  Material  Adverse  Effect:  the  Borrower  and its
Restricted   Subsidiaries   comply  and  have  complied   with  all   applicable
Environmental  Laws, and possess and comply with and have possessed and complied


<PAGE>

                                       37


with all  Environmental  Permits  required  under such laws;  there are no past,
present,  or anticipated future events,  conditions,  circumstances,  practices,
plans,  or  legal  requirements  that,  to  its  knowledge,  could  prevent,  or
materially  increase the burden on the Borrower and its Restricted  Subsidiaries
of, compliance with applicable Environmental Laws or of obtaining,  renewing, or
complying with all Environmental  Permits required under such laws; the Borrower
and its Restricted  Subsidiaries have received no notice of any violation of, or
potential liability under, any Environmental Law; and there are and have been no
Materials of  Environmental  Concern or other  conditions at any property owned,
operated,   or  otherwise  used  by  the  Borrower  or  any  of  its  Restricted
Subsidiaries  now or, to its knowledge,  in the past, or at any other  location,
that could  give rise to  liability  of the  Borrower  or any of its  Restricted
Subsidiaries under any Environmental Law.

                     3.17  Senior  Indebtedness.   The  Loans  to  the  Borrower
outstanding  on the Closing Date are, and all other Loans to the Borrower,  when
made, will constitute "Senior  Indebtedness"  under and as defined in the 6-3/4%
Debenture Indenture.

                     3.18 Certain Documents.  The Borrower has delivered to each
Lender a complete,  correct and current copy of the  Management  Agreement,  the
Voting  Agreement,  the 6-3/4%  Debenture  Indenture and any other  document the
Administrative Agent shall reasonably request.


                         SECTION 4. CONDITIONS PRECEDENT

                     4.1 Conditions to Effectiveness.  The effectiveness of this
Agreement  and the  agreement  of each Lender to make the  extensions  of credit
requested to be made by it are subject to the satisfaction, immediately prior to
or  concurrently  with the  foregoing  on the  Closing  Date,  of the  following
conditions precedent:

                     (a) Prepayment of Existing  Loans.  The Borrower shall have
           prepaid  in full  the  Existing  Loan,  shall  have  paid in full all
           interest and fees accrued through the Closing Date under the Existing
           Credit Agreement.

                     (b) Loan  Documents.  The  Administrative  Agent shall have
           received  (i)  this  Agreement,  executed  and  delivered  by a  duly
           authorized  officer  of the  Borrower,  with a  counterpart  for each
           Lender and (ii) the other Loan Documents, each executed and delivered
           by  a  duly  authorized  officer  of  the  parties  thereto,  with  a
           counterpart or a conformed copy for each Lender.

                     (c) Other Documents.  The  Administrative  Agent shall have
           received,  with a copy for each  Lender,  true  and  correct  copies,
           certified as to  authenticity  by the Borrower,  of such documents or
           instruments  as may be  reasonably  requested  by the  Administrative
           Agent, including,  without limitation, a copy of the 6-3/4% Debenture
           Indenture and any other debt instrument,  security agreement or other
           material  contract to which the Borrower or its Subsidiaries may be a
           party.

                      (d) Borrowing Certificate.  The Administrative Agent shall
           have  received,  with a copy for each Lender,  a  certificate  of the
           Borrower, dated the Closing Date,


<PAGE>

                                       38


           substantially in the form of Exhibit F, with  appropriate  insertions
           and   attachments,   satisfactory   in  form  and  substance  to  the
           Administrative Agent, executed by the President or any Vice President
           and the Secretary or any Assistant Secretary of the Borrower.

                     (e)   Corporate   Proceedings   of   the   Borrower.    The
           Administrative  Agent  shall  have  received,  with a copy  for  each
           Lender, a copy of the resolutions, in form and substance satisfactory
           to  the  Administrative  Agent,  of the  Board  of  Directors  of the
           Borrower  authorizing (i) the execution,  delivery and performance of
           this  Agreement  and the other Loan  Documents to which it is a party
           and (ii)  the  borrowings  contemplated  hereunder  certified  by the
           Secretary or an Assistant Secretary of the Borrower as of the Closing
           Date, which certificate  shall be in form and substance  satisfactory
           to the  Administrative  Agent and shall  state  that the  resolutions
           thereby  certified  have  not  been  amended,  modified,  revoked  or
           rescinded.

                     (f) Borrower  Incumbency  Certificate.  The  Administrative
           Agent shall have received, with a copy for each Lender, a Certificate
           of the Borrower,  dated the Closing Date,  as to the  incumbency  and
           signature of the officers of the Borrower executing any Loan Document
           satisfactory  in form  and  substance  to the  Administrative  Agent,
           executed by the President or any Vice  President and the Secretary or
           any Assistant Secretary of the Borrower.

                     (g)   Corporate    Proceedings   of    Subsidiaries.    The
           Administrative  Agent  shall  have  received,  with a copy  for  each
           Lender, a copy of the resolutions, in form and substance satisfactory
           to the  Administrative  Agent,  of the  Board  of  Directors  of each
           Subsidiary  of the  Borrower  which  is a  party  to a Loan  Document
           authorizing  the  execution,  delivery  and  performance  of the Loan
           Documents to which it is a party and certified by the Secretary or an
           Assistant  Secretary of each such  Subsidiary as of the Closing Date,
           which certificate shall be in form and substance  satisfactory to the
           Administrative  Agent and shall  state that the  resolutions  thereby
           certified have not been amended, modified, revoked or rescinded.

                     (h) Subsidiary Incumbency Certificates.  The Administrative
           Agent shall have received, with a copy for each Lender, a certificate
           of each  Subsidiary of the Borrower which is a Loan Party,  dated the
           Closing Date, as to the  incumbency  and signature of the officers of
           such Subsidiaries  executing any Loan Document,  satisfactory in form
           and substance to the Administrative  Agent, executed by the President
           or any Vice President and the Secretary or any Assistant Secretary of
           each such Subsidiary.

                     (i) Corporate  Documents.  The  Administrative  Agent shall
           have received,  with a copy for each Lender, true and complete copies
           of the  certificate  of  incorporation  and by-laws of the  Borrower,
           certified  as of the  Closing  Date as complete  and  correct  copies
           thereof by the Secretary or an Assistant Secretary of the Borrower.

                     (j) Fees. The Administrative  Agent shall have received the
           fees  to be  received  on the  Closing  Date  referred  to in the Fee
           Letter, between the Borrower and Chase.


<PAGE>

                                       39


                     (k) Legal  Opinions.  The  Administrative  Agent shall have
           received,  with a  counterpart  for each Lender,  the executed  legal
           opinions  of  Debevoise  & Plimpton  and  __________,  counsel to the
           Borrower and its Restricted  Subsidiaries,  substantially in the form
           of  Exhibits  D and E. Such  legal  opinions  shall  cover such other
           matters incident to the  transactions  contemplated by this Agreement
           as the Administrative Agent may reasonably require.

                     (l)   Additional   Matters.   All   corporate   and   other
           proceedings,  and all documents,  instruments and other legal matters
           in connection  with the  transactions  contemplated by this Agreement
           and the  other  Loan  Documents  shall  be  satisfactory  in form and
           substance to the Administrative  Agent, and the Administrative  Agent
           shall  have  received  such other  documents  and legal  opinions  in
           respect of any aspect or consequence of the transactions contemplated
           hereby or thereby as it shall reasonably request.

                     4.2  Conditions to Each Loan.  The agreement of each Lender
to  make  any  extension  of  credit  requested  to be  made  by it on any  date
(including,  without limitation,  its initial extension of credit) is subject to
the satisfaction of the following conditions precedent:

                     (a)   Representations   and   Warranties.   Each   of   the
           representations and warranties made by the Borrower or any other Loan
           Party in or pursuant to the Loan Documents  shall be true and correct
           in all material  respects on and as of such date as if made on and as
           of such date.

                     (b) No Default.  No Default or Event of Default  shall have
           occurred and be continuing on such date or after giving effect to the
           extension of credit requested to be made on such date.

                     (c) Compliance with 6-3/4% Debenture Indenture.  The making
           of such  extensions  of credit shall not result in a violation of the
           6-3/4% Debenture Indenture.

Each borrowing by the Borrower  hereunder shall constitute a representation  and
warranty by the Borrower as of the date thereof that the conditions contained in
this subsection have been satisfied.


                        SECTION 5. AFFIRMATIVE COVENANTS

                     The Borrower  hereby  agrees that, so long as the Revolving
Credit  Commitments remain in effect or any amount is owing to any Lender or the
Administrative  Agent  hereunder or under any other Loan Document,  the Borrower
shall and (except in the case of delivery of financial information,  reports and
notices) shall cause each of its Restricted Subsidiaries to:


<PAGE>

                                       40


                     5.1  Financial Statements.  Furnish to each Lender:

                     (a) as soon as available,  but in any event within 120 days
           after  the end of each  fiscal  year of the  Borrower,  a copy of the
           consolidated  balance  sheet  of  the  Borrower  and  its  Restricted
           Subsidiaries as at the end of such year and the related  consolidated
           statements of income and retained earnings and of cash flows for such
           year,  setting forth in each case in comparative form the figures for
           the  previous  year,  reported  on without a "going  concern" or like
           qualification or exception, or qualification arising out of the scope
           of the audit, by Price Waterhouse LLP or other independent  certified
           public accountants of nationally recognized standing; and

                     (b) as soon as  available,  but in any event not later than
           60 days after the end of each of the quarterly periods of each fiscal
           year of the Borrower, the unaudited consolidated balance sheet of the
           Borrower  and  its  Restricted  Subsidiaries  as at the  end of  such
           quarter and the related unaudited  consolidated  statements of income
           and  retained  earnings  and of cash  flows of the  Borrower  and its
           Restricted  Subsidiaries  for such  quarter  and the  portion  of the
           fiscal year through the end of such  quarter,  setting  forth in each
           case in comparative form the figures for the previous year, certified
           by a  Responsible  Officer  as being  fairly  stated in all  material
           respects  (subject  to  normal  year-end  audit  adjustments  and the
           absence of footnote disclosure);

all such  financial  statements  shall be prepared in  reasonable  detail and in
accordance  with GAAP  applied  consistently  throughout  the periods  reflected
therein  and with prior  periods  (except as  approved  by such  accountants  or
officer, as the case may be, and disclosed therein).

                     5.2  Certificates;   Other  Information.  Furnish  to  each
Lender:

                     (a)  concurrently   with  the  delivery  of  the  financial
           statements  referred to in subsection  5.1(a),  a certificate  of the
           independent  certified public accountants reporting on such financial
           statements stating that in making the examination  necessary therefor
           no knowledge was obtained of any Default or Event of Default,  except
           as specified in such certificate;

                     (b)  concurrently   with  the  delivery  of  the  financial
           statements  referred to in subsections  5.1(a) and (b), a certificate
           of a Responsible  Officer stating that, to the best of such Officer's
           knowledge,  during  such  period no Default  or Event of Default  has
           occurred and is  continuing  except as specified in such  certificate
           and demonstrating compliance with the financial covenants in a manner
           reasonably satisfactory to the Administrative Agent;

                     (c) not later  than  thirty  days  prior to the end of each
           fiscal year of the Borrower,  a copy of the operating budget and cash
           flow budget of the Borrower and its Restricted  Subsidiaries  for the
           succeeding fiscal year;

                      (d)  promptly  after  the same  are  sent,  copies  of all
           financial statements, reports and proxy statements which the Borrower
           sends to its  stockholders,  and  promptly  after the same are filed,

<PAGE>

                                       41


           copies  of all  financial  statements,  registration  statements  and
           publicly  available  reports  which the Borrower has filed with,  the
           Securities  and  Exchange  Commission  or any  successor or analogous
           Governmental Authority; and

                     (e)   promptly,   such   additional   financial  and  other
           information as any Lender may from time to time reasonably request.

                     5.3 Payment of  Obligations.  Pay,  discharge  or otherwise
satisfy at or before maturity or before they become delinquent,  as the case may
be, all its obligations of whatever nature,  except where the amount or validity
thereof is currently  being  contested in good faith by appropriate  proceedings
and reserves in conformity  with GAAP with respect thereto have been provided on
the books of the  Borrower  or its  Subsidiaries,  as the case may be, or except
where the failure to pay,  discharge or otherwise satisfy such obligations could
not be reasonably expected to have a Material Adverse Effect.

                     5.4  Conduct of  Business  and  Maintenance  of  Existence.
Continue to engage in business of the same general type as now  conducted by the
Borrower and its Restricted  Subsidiaries  and preserve,  renew and keep in full
force and effect  its  corporate  existence  and take all  reasonable  action to
maintain all material rights,  privileges and franchises  necessary or desirable
in the normal conduct of its business except as otherwise  permitted pursuant to
subsection 6.5; comply with all Contractual  Obligations and Requirements of Law
except  to the  extent  that  failure  to comply  therewith  could  not,  in the
aggregate, be reasonably expected to have a Material Adverse Effect.

                     5.5 Maintenance of Property;  Insurance.  Keep all property
useful  and  necessary  in its  business  in good  working  order and  condition
(ordinary wear and tear expected); maintain with financially sound and reputable
insurance  companies  insurance on all its property in at least such amounts and
against at least such risks as are usually  insured  against in the same general
area by companies engaged in the same or a similar business; and furnish to each
Lender, upon written request, full information as to the insurance carried.

                     5.6 Inspection of Property; Books and Records; Discussions.
Keep proper books of records and account in which full, true and correct entries
in  conformity  with  GAAP  and all  Requirements  of Law  shall  be made of all
dealings and transactions in relation to its business and activities; and permit
representatives  of any Lender to visit and  inspect any of its  properties  and
examine and make  abstracts  from any of its books and records at any reasonable
time and upon  reasonable  advance  notice  and as  often as may  reasonably  be
desired and to discuss the business,  operations,  properties  and financial and
other condition of the Borrower and its Subsidiaries.

                     5.7  Notices.  Promptly  give notice to the  Administrative
Agent and each Lender of:

                      (a) the occurrence of any Default or Event of Default;

                      (b)  any  (i)  default  or  event  of  default  under  any
           Contractual  Obligation of the Borrower or any of its Subsidiaries of
           which  the  Borrower  or  such   Subsidiary  has  knowledge  or  (ii)


<PAGE>

                                       42


           litigation,  investigation  or proceeding which may exist at any time
           between the Borrower or any of its  Subsidiaries and any Governmental
           Authority,  which  in  either  case,  if not  cured  or if  adversely
           determined,  as the case may be, could reasonably be expected to have
           a Material Adverse Effect;

                      (c) any litigation or proceeding affecting the Borrower or
           any of its Subsidiaries  which could reasonably be expected to have a
           Material Adverse Effect;

                     (d) the  following  events,  as soon as possible and in any
           event  within  30 days  after the  Borrower  knows  thereof:  (i) the
           occurrence  or  expected  occurrence  of any  Reportable  Event  with
           respect to any Single  Employer  Plan, a failure to make any required
           contribution to a Plan, the creation of any Lien on the assets of the
           Borrower or any Commonly  Controlled Entity in favor of the PBGC or a
           Plan or any withdrawal  from, or the termination,  Reorganization  or
           Insolvency  of,  any  Multiemployer  Plan if, as a result of any such
           event, the Borrower would be reasonably expected to incur a liability
           in excess of $1,000,000 or (ii) the institution of proceedings or the
           taking  of any  other  action  by the  PBGC  or the  Borrower  or any
           Commonly  Controlled Entity or any Multiemployer Plan with respect to
           the withdrawal from, or the terminating, Reorganization or Insolvency
           of, any Plan if, as a result of any such event, the Borrower would be
           reasonably expected to incur a liability in excess of $1,000,000; and

                     (e)  any Person becoming a Restricted Subsidiary;

                     (f)  any  development  or  event  which  has  had or  could
           reasonably be expected to have a Material Adverse Effect.

Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible  Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower proposes to take with respect thereto.

                     5.8 Additional Guarantors. With respect to any Person that,
subsequent to the Closing Date, becomes a Restricted Subsidiary,  cause such new
Restricted  Subsidiary  which is a Domestic  Subsidiary to become a party to the
Guarantee pursuant to documentation which is in form and substance  satisfactory
to the  Administrative  Agent and, if  requested  by the  Administrative  Agent,
deliver  to  the   Administrative   Agent  legal   opinions   relating  to  such
documentation,  which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.

                     5.9  Unrestricted  Subsidiaries;  Maintenance  of  Separate
Corporate Identity.

                      (a) The Borrower will deliver to the Administrative  Agent
           (with  sufficient  copies for each of the Lenders) a notice as to the
           organization or acquisition of each Unrestricted  Subsidiary promptly
           following  such   organization   or   acquisition   together  with  a
           certificate of a Responsible  Officer of the Borrower certifying that
           attached  thereto are true copies of (i) the resolutions duly adopted
           by the Board of Directors of the Borrower designating such Subsidiary
           as an Unrestricted  Subsidiary and (ii) all  agreements,  instruments
           and other  documents  relating to the  organization or acquisition of
           such Unrestricted Subsidiary.


<PAGE>

                                       43


                     (b) The Borrower will, promptly upon receipt thereof by the
           Borrower or any of its  Subsidiaries,  deliver to the  Administrative
           Agent  (with  sufficient  copies for each of the  Lenders) a true and
           complete  copy  of  each  agreement,  instrument  or  other  document
           evidencing   Indebtedness  or  other  material  obligations  of  each
           Unrestricted Subsidiary and each other material agreement, instrument
           or  other  document  (including,   without  limitation,   agreements,
           instruments and other documents in respect of  acquisitions)  entered
           into by each Unrestricted Subsidiary.

                     (c) The Borrower  will cause the  management,  business and
           affairs of each of the Borrower and its  Subsidiaries to be conducted
           in such a manner so that each of the  Borrower  and its  Subsidiaries
           will be perceived and treated as a legal entity separate and distinct
           from each other.  Without in any way limiting the other provisions of
           this  subsection,   the  Borrower  will  not  permit  any  Restricted
           Subsidiary to, directly or indirectly:  (i) make any Investment in an
           Unrestricted Subsidiary,  (ii) dispose of any of its Properties to an
           Unrestricted  Subsidiary,  (iii)  merge into or  consolidate  with or
           purchase or acquire any Properties from an Unrestricted Subsidiary or
           (iv) enter into any other transaction  directly or indirectly with or
           for the benefit of an  Unrestricted  Subsidiary  (including,  without
           limitation,   guarantees   and   assumptions  of  obligations  of  an
           Unrestricted  Subsidiary);  provided that it is  understood  that the
           Borrower as the "common  parent" of its Restricted  Subsidiaries  and
           Unrestricted  Subsidiaries  may file a  consolidated  tax  return  on
           behalf of itself and its  Subsidiaries  and such filing  shall not be
           deemed to violate the provisions of this subsection.

                     (d)  The  Borrower  will  allocate  corporate  general  and
           administrative  expenses between it, the Restricted  Subsidiaries and
           the  Unrestricted  Subsidiaries  in  accordance  with  customary  and
           reasonable business practices and GAAP consistently applied.  Without
           in any way  limiting the other  provisions  of this  subsection,  the
           Borrower will not permit any Restricted  Subsidiary  to,  directly or
           indirectly,  pay or incur any  corporate  general and  administrative
           expenses on behalf of any Unrestricted Subsidiary.

                     5.10 Sinking Fund Payment Credits. the Borrower will at all
times exercise its option under Section 1402 of the 6 3/4%  Debenture  Indenture
(and take all action as shall be necessary  to give effect to such  exercise) to
apply all 6 3/4%  Debentures  that shall have been  redeemed or  converted  as a
credit against the mandatory sinking fund payments required from time to time by
said Indenture


                          SECTION 6. NEGATIVE COVENANTS

                     The Borrower  hereby  agrees that, so long as the Revolving
Credit  Commitments remain in effect or any amount is owing to any Lender or the
Administrative  Agent  hereunder or under any other Loan Document,  the Borrower
shall not, and (except with respect to  subsection  6.1) shall not permit any of
its Restricted Subsidiaries to, directly or indirectly:


<PAGE>

                                       44


                     6.1  Financial Condition Covenants.

                      (a) Maintenance of Total Debt Ratio. Permit the Total Debt
           Ratio at any time  during any  period  set forth  below to be greater
           than the ratio set forth opposite such period below:

                     Period                               Ratio
                     ------                               -----

               Closing Date - 12/30/97                    5.25:1
               12/31/97 - 12/30/98                        4.75:1
               12/31/98 - Thereafter                      4.00:1

                      (b) Maintenance of Total Interest  Coverage Ratio.  Permit
           the Total Interest Coverage Ratio at any time to be less than 2.00:1.

                      (c)  Maintenance  of Total Fixed  Charge  Coverage  Ratio.
           Permit the Total Fixed Charge  Coverage  Ratio at any time to be less
           than 1.10:1.

                     6.2 Limitation on Indebtedness.  Create,  incur,  assume or
suffer to exist any Indebtedness, except:

                      (a) Indebtedness of the Borrower under this Agreement;

                      (b) Indebtedness  of  the  Borrower  to  any  Restricted
           Subsidiary  and of any  Restricted  Subsidiary to the Borrower or any
           other Restricted Subsidiary;

                      (c) Indebtedness of the Borrower and any of its Restricted
           Subsidiaries  incurred to finance the acquisition of fixed or capital
           assets  (whether  pursuant to a loan, a Financing Lease or otherwise)
           not  exceeding  $5,000,000 in aggregate  principal  amount at any one
           time  outstanding  and  any  refinancings,  refundings,  renewals  or
           extensions  thereof  (provided  that  the  principal  amount  of such
           Indebtedness shall at no time exceed 100% of the original acquisition
           cost of such assets plus any costs  associated  with the financing or
           refinancing thereof);

                      (d) Indebtedness outstanding on the date hereof and listed
           on  Schedule  6.2  and  any  refinancings,  refundings,  renewals  or
           extensions  thereof  (provided  that  the  principal  amount  of such
           Indebtedness  is  not  increased  by an  amount  greater  than  costs
           associated  with  any  such  refinancing,   refundings,  renewals  or
           extensions);

                      (e)  Indebtedness  of a Person which  becomes a Restricted
           Subsidiary  after the date hereof and any  refinancings,  refundings,
           renewals or extensions  thereof,  provided that (i) such Indebtedness
           existed at the time such Person became a Restricted  Subsidiary  (or,
           if later,  at the time it acquired the assets of a business  pursuant
           to subsection 6.8(c)) and was not created in anticipation thereof and
           (ii)  immediately  after  giving  effect to the  acquisition  of such
           Person by the  Borrower  no Default  or Event of  Default  shall have
           occurred and be continuing;


<PAGE>

                                       45


                      (f) Permitted Additional Indebtedness; and

                      (g) additional  Indebtedness not exceeding  $10,000,000 in
           aggregate principal amount at any one time outstanding.

                     6.3 Limitation on Liens. Create, incur, assume or suffer to
exist any Lien upon any of its property,  assets or revenues,  whether now owned
or hereafter acquired, except for:

                      (a)  Liens  for taxes not yet  subject  to  penalties  for
           non-payment or which are being contested in good faith by appropriate
           proceedings,  provided  that,  if contested,  adequate  reserves with
           respect  thereto are  maintained  on the books of the Borrower or its
           Restricted Subsidiaries,  as the case may be, in conformity with GAAP
           (or,  in  the  case  of  Foreign  Subsidiaries,   generally  accepted
           accounting principles in effect from time to time in their respective
           jurisdictions of incorporation);

                      (b) Liens imposed by law, such as  landlords',  carriers',
           warehousemen's,  materialmen's and mechanics' liens, or Liens arising
           out  of  judgments  or  awards  against  the  Borrower  or any of its
           Restricted  Subsidiaries  with  respect to which the Borrower or such
           Restricted  Subsidiary at the time shall  currently be prosecuting an
           appeal  or  proceedings  for  review  in  good  faith  and by  proper
           proceedings;

                      (c)  pledges  or  deposits  in  connection  with  workers'
           compensation,   unemployment  insurance  and  other  social  security
           legislation  and deposits  securing  liability to insurance  carriers
           under insurance or self-insurance arrangements;

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

                      (e)  easements,  rights-of-way,   restrictions  and  other
           similar  encumbrances  incurred  in the  ordinary  course of business
           which,  in the aggregate,  are not substantial in amount and which do
           not in any case  materially  detract  from the value of the  property
           subject thereto or materially  interfere with the ordinary conduct of
           the  business  taken as a whole of the  Borrower  or such  Restricted
           Subsidiary;

                      (f) Liens  securing  Indebtedness  of the Borrower and its
           Restricted  Subsidiaries  permitted by subsection  6.2(c) incurred to
           finance the acquisition of fixed or capital assets, provided that (i)
           such Liens  shall be created  substantially  simultaneously  with the
           acquisition of such fixed or capital  assets,  (ii) such Liens do not
           at any time encumber any property other than the property financed by
           such Indebtedness,  (iii) the amount of Indebtedness  secured thereby
           is not  increased  and  (iv) the  principal  amount  of  Indebtedness
           secured by any such Lien shall at no time exceed 100% of the original
           purchase  price of such property at the time it was acquired plus any
           financing or refinancing costs;


<PAGE>

                                       46


                      (g)  Liens in  existence  on the  date  hereof  listed  on
           Schedule 6.3, securing  Indebtedness  permitted by subsection 6.2(d),
           provided that no such Lien is spread to cover any additional property
           after the Closing  Date and that the amount of  Indebtedness  secured
           thereby is not increased except as permitted by subsection 6.2(d);

                      (h) Liens on assets  acquired by a  Restricted  Subsidiary
           after the date hereof or on the  property or assets of a Person which
           becomes  a  Restricted  Subsidiary  after  the date  hereof  securing
           Indebtedness permitted by subsection 6.2(c) or 6.2(e),  respectively,
           provided  that (i) such  Liens  exist at the  time  such  assets  are
           acquired or at the time such Person becomes a Restricted  Subsidiary,
           as the case may be, and are not created in anticipation thereof, (ii)
           any such Lien is not spread to cover any  property  or assets of such
           Person after the time such Person becomes a Restricted  Subsidiary or
           such  assets  are  acquired,  and  (iii) the  amount of  Indebtedness
           secured thereby is not increased;

                      (i)   Liens  on  the   Capital   Stock   of   Unrestricted
           Subsidiaries securing obligations of Unrestricted Subsidiaries; and

                      (j) Liens (not otherwise  permitted  hereunder) so long as
           the greater of (i) the aggregate  outstanding principal amount of the
           obligations  secured thereby and (ii) the aggregate fair market value
           of the assets subject  thereto does not exceed  $5,000,000 at any one
           time.

                     6.4  Limitation on Guarantee  Obligations.  Create,  incur,
assume or suffer to exist any Guarantee Obligation except:

                      (a) Guarantee  Obligations in existence on the date hereof
           and listed on Schedule 6.4;

                      (b)  Guarantee  Obligations  of a Person  which  becomes a
           Restricted  Subsidiary  after  the date  hereof,  provided  that such
           Guarantee  Obligations  exist  at the  time  such  Person  becomes  a
           Restricted  Subsidiary  (or, if later,  at the time it  acquired  the
           assets of a  business  pursuant  to  subsection  6.8(c))  and are not
           created in anticipation thereof,

                      (c)  Guarantee  Obligations  entered  into in the ordinary
           course of its business by the Borrower or any  Restricted  Subsidiary
           of obligations of any of the Borrower or its Restricted Subsidiaries,
           which obligations are not prohibited by this Agreement;

                      (d) the Guarantee; and

                      (e)  additional   Guarantee   Obligations  in  respect  of
           obligations not exceeding  $10,000,000 in aggregate  principal amount
           at any one time outstanding.


<PAGE>

                                       47


                     6.5  Limitation  on  Fundamental  Changes.  Enter  into any
merger, consolidation or amalgamation,  or liquidate, wind up or dissolve itself
(or suffer any liquidation or  dissolution),  or convey,  sell,  lease,  assign,
transfer or  otherwise  dispose of, all or  substantially  all of its  property,
business or assets, except:

                      (a)  any  Restricted  Subsidiary  of the  Borrower  may be
           merged or consolidated  with or into the Borrower  (provided that the
           Borrower shall be the continuing or surviving corporation) or with or
           into any one or more  wholly  owned  Restricted  Subsidiaries  of the
           Borrower  (provided  that the wholly owned  Restricted  Subsidiary or
           Restricted Subsidiaries shall be the continuing or surviving Person);

                      (b) any Restricted Subsidiary may sell, lease, transfer or
           otherwise  dispose  of  any or all  of  its  assets  (upon  voluntary
           liquidation  or  otherwise)  to  the  Borrower  or any  wholly  owned
           Restricted Subsidiary of the Borrower;

                      (c) the Borrower or any of its Restricted Subsidiaries may
           enter into a merger with any Person engaged in the  commercial  radio
           business  (which  shall be deemed  to  include,  without  limitation,
           programming,  production  and  distribution)  or any  other  business
           related to the foregoing, provided that the fair market value of such
           Persons  (for  all  such  mergers),   when  added  to  the  aggregate
           consideration  paid in connection with all  acquisitions  consummated
           pursuant to subsection  6.8(c),  shall not exceed  $50,000,000 if the
           Total  Debt  Ratio is  greater  than or  equal  to 4.75 to 1.0,  and,
           provided further that the Borrower or a Restricted Subsidiary, as the
           case may be, shall be the surviving  corporation  and that both prior
           to and  after  giving  effect to such  merger  there  shall  exist no
           Default or Event of Default  hereunder  and the  Borrower  shall have
           delivered a certificate (with such supporting detail and calculations
           as may be reasonably  requested by the  Administrative  Agent) from a
           Responsible Officer so stating to the Administrative Agent; and

                      (d) as permitted by subsection 6.6.

                     6.6  Limitation  on Sale of Assets.  Convey,  sell,  lease,
assign, transfer or otherwise dispose of any of its property, business or assets
(including,  without limitation,  receivables and leasehold interests),  whether
now owned or hereafter acquired,  or, in the case of any Restricted  Subsidiary,
issue or sell any shares of such  Restricted  Subsidiary's  Capital Stock to any
Person  other than the  Borrower  or any  wholly  owned  Restricted  Subsidiary,
except:

                      (a) the sale or other  disposition  of any property in the
           ordinary course of business;

                      (b) any sale, assignment, transfer or other disposition of
           Capital Stock of any Unrestricted Subsidiary;

                      (c) the sale or other  disposition of any other  property,
           business or asset with an  aggregate  fair market value not to exceed
           $5,000,000  so long as (i) the  consideration  received  shall  be an
           amount at least equal to the fair market value thereof: (ii) at least


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                                       48


           90% of the  consideration  received shall be cash; (iii) the proceeds
           of such  sale  or  other  disposition  are  applied  as  required  by
           subsection 2.9(b); and (iv) no Default or Event of Default shall have
           occurred and be continuing or would result therefrom; and

                     (d)  as permitted by subsection 6.5(b).

                     6.7 Limitation on Restricted  Payments.  Declare or pay any
dividend (other than dividends  payable solely in Capital Stock of the Borrower)
on, or make any payment or  prepayment  on account of, or set apart assets for a
sinking or other  analogous  fund for,  the  purchase,  redemption,  defeasance,
retirement or other  acquisition of, any shares of any class of Capital Stock of
the Borrower or any Restricted Subsidiary or any warrants or options to purchase
any such Capital Stock or any of the 6-3/4%  Debentures,  or make any payment of
management or similar fees (including, without limitation,  Management Fees, but
excluding all expenses payable to Infinity, in its capacity as "Manager",  under
Section 1.6 of the Management  Agreement) to Infinity or any other  Affiliate of
the Borrower (other than to any employee, officer or director of the Borrower or
its  Subsidiaries  in  connection  with  the  performance  of  such  employee's,
officer's  or  director's  duties in such  capacity),  whether now or  hereafter
outstanding,  or make any other distribution in respect thereof, either directly
or indirectly,  whether in cash or property or in obligations of the Borrower or
any  Restricted   Subsidiary  (such  declarations,   payments,   setting  apart,
purchases, redemptions, defeasances, retirements, acquisitions and distributions
being  herein  called  "Restricted  Payments"),  except that (a) any  Restricted
Subsidiary may make  Restricted  Payments to the Borrower,  (b) the Borrower may
make  Restricted  Payments  (i) for the  purpose of cashing  out any  fractional
shares of Capital Stock  following the payment of a dividend  payable in Capital
Stock of the Borrower or the conversion of any of its convertible  debt into its
Capital  Stock  and (ii) to  redeem  the  Borrower's  outstanding  Class  Action
Warrants when and to the extent required by the terms thereof,  (c) the Borrower
and its  Restricted  Subsidiaries  may make  Restricted  Payments (i) during the
period from and including  the Closing Date to and including  September 29, 1999
in an  aggregate  amount  which,  when  added  to the  aggregate  amount  of any
Investments in Unrestricted Subsidiaries made during such period as permitted by
subsection  6.8(g), is not in excess of the First  Unrestricted  Basket and (ii)
during the period from and  including  September  30, 1999 to and  including the
Termination  Date in an  aggregate  amount  which,  when added to the  aggregate
amount of any Investments in Unrestricted  Subsidiaries  made during such period
as permitted by subsection  6.8(g), is not in excess of the Second  Unrestricted
Basket,  and (d) the  Borrower  may make  scheduled  payments of interest on the
6-3/4%  Debentures  to the extent  required by the 6-3/4%  Debenture  Indenture;
provided that, prior to and after giving effect to each such Restricted  Payment
described in clauses (c) and (d) above, there shall exist no Default or Event of
Default hereunder and the Borrower shall have delivered a certificate (with such
supporting  detail  and  calculations  as may  be  reasonably  requested  by the
Administrative  Agent) from a  Responsible  Officer so stating,  and (e) (i) the
issuance and delivery to INI of  Incentive  Warrants  pursuant to Section 2.3 of
the  Management  Agreement  and (ii)  subject  in each  case to the terms of the
Management Services Subordination Agreement and provided that, both prior to and
after  giving  effect to each such  payment,  no Event of  Default  pursuant  to
Sections  7(a),  (c)  (solely  in the case of an Event of  Default  pursuant  to
subsection 6.1, and, in such case, only if the Majority  Lenders  following such


<PAGE>

                                       49


an Event of Default  shall  determine in their sole  discretion  to prohibit any
payment  provided for in clause (x) or (y) below) or (f) shall have occurred and
be continuing: (x) cash payments of Management Fees to Infinity at the times and
in the  amounts  provided  for by Section  2.1 of the  Management  Agreement  in
respect  of each  fiscal  year  and (y) a cash  payment  of  Management  Fees to
Infinity  at the times and in the  amounts  provided  for by Section  2.2 of the
Management Agreement,  so long as, in the case of clause (y): (I) at least three
Business  Days (but not more than 30  Business  Days)  prior to the date of such
payment,  the  Borrower  shall have  delivered to the  Administrative  Agent the
financial  statements  required to be delivered for such fiscal year pursuant to
Section  5.1(a) and a  certificate  of a  Responsible  Officer  of the  Borrower
setting  forth a  computation  of the Excess Cash Flow for the prior fiscal year
and  describing  the  amount  of such  Management  Fees to be paid and (II) such
payment shall be made  promptly  following  any  prepayment  required to be made
under  Section  2.9(a) with  respect to Excess  Cash Flow for such prior  fiscal
year.

                     6.8 Limitation on Investments, Loans and Advances. Make any
advance,  loan,  extension of credit or capital contribution to, or purchase any
stock,  bonds,   notes,   debentures  or  other  securities  of  or  any  assets
constituting  a  business  unit of, or make any other  investment  in (each,  an
"Investment") any Person, except:

                      (a)  extensions of trade credit in the ordinary  course of
           business;

                      (b) investments in Cash Equivalents;

                      (c) purchases of shares of the Capital Stock of any Person
           engaged in the commercial  radio  business  (which shall be deemed to
           include,    without   limitation,    programming,    production   and
           distribution)  or any other  business  related  to the  foregoing  or
           purchases of the assets  constituting  all or any portion of any such
           business  owned by any  other  Person,  provided  that the  aggregate
           consideration  for all  such  acquisitions,  when  added  to the fair
           market  value of all Persons  merged into the  Borrower or any of its
           Restricted  Subsidiaries  pursuant to  subsection  6.5(c),  shall not
           exceed  $50,000,000  if the Total Debt Ratio is greater than or equal
           to 4.75 to 1.0, and provided  further that, prior to and after giving
           effect to such  purchase,  there  shall  exist no Default or Event of
           Default and the Borrower  shall have  delivered a  certificate  (with
           such  supporting   detail  and  calculations  as  may  be  reasonably
           requested by the Administrative  Agent) from a Responsible Officer so
           stating  and  provided  further,  that any such  Person  which  shall
           constitute  a  Subsidiary   following  such  Investment  shall  be  a
           Restricted Subsidiary or, as the case may be, the assets so purchased
           shall be owned by a Restricted Subsidiary;

                     (d) loans and  advances to officers  and  employees  of the
           Borrower or its Restricted Subsidiaries for travel, entertainment and
           relocation  expenses  and other  purposes in the  ordinary  course of
           business;

                      (e)   Investments   by  the  Borrower  in  its  Restricted
           Subsidiaries  and Investments by such Restricted  Subsidiaries in the
           Borrower and in other Restricted Subsidiaries;

                     (f)  Investments set forth on Schedule 6.8; and

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                                       50


                     (g) (i) Investments in Unrestricted  Subsidiaries as of the
           Closing Date,  (ii)  Investments  in  Unrestricted  Subsidiaries  the
           consideration for which shall consist solely of shares of the Capital
           Stock  of  the  Borrower   and  (iii)   additional   Investments   in
           Unrestricted  Subsidiaries  (A) during the period from and  including
           the Closing Date to and including  September 29, 1999 in an aggregate
           amount which,  when added to the aggregate  amount of any  Restricted
           Payments   made  during  such  period  as  permitted  by   subsection
           6.7(b)(i),  is not in excess of the First Unrestricted Basket and (B)
           during  the  period  from and  including  September  30,  1999 to and
           including the  Termination  Date in an aggregate  amount which,  when
           added to the aggregate amount of any Restricted  Payments made during
           such period as permitted by subsection  6.7(b)(ii),  is not in excess
           of the Second Unrestricted Basket.

                     6.9 Limitation on Optional  Payments and  Modifications  of
Debt  Instruments.  (a) Make any optional payment or prepayment on or redemption
or purchase of the 6-3/4%  Debentures  (other than pursuant to subsection 6.2(d)
or 6.7),  (b)  amend,  modify or change,  or consent or agree to any  amendment,
modification  or  change  to any of the  terms  of the  6-3/4%  Debentures,  the
Infinity  Agreements (in any manner that could have a material adverse effect on
the Lenders, provided that the Borrower shall inform the Lenders of any material
amendment,  modification or change to an Infinity Agreement within 30 days after
the  Borrower  agrees to such  amendment,  modification  or change) or the Class
Action Warrants (in any manner that is materially  adverse to the Borrower),  or
(c) amend the subordination provisions of the 6 3/4% Debentures.

                     6.10  Limitation  on  Capital   Expenditures.   Permit  the
aggregate amount of Capital Expenditures in any fiscal year to exceed the sum of
(a) $5,000,000  plus (b) for each fiscal year commencing on and after January 1,
1997,  the  excess,  if any,  of the  aggregate  amount of Capital  Expenditures
permitted in the  immediately  preceding  fiscal year over the actual  amount of
Capital  Expenditures  made by the Borrower and its Restricted  Subsidiaries  in
such immediately  preceding fiscal year (provided that the amount of such excess
for such immediately preceding fiscal year shall not exceed $3,000,000).

                     6.11  Limitation  on Sale or Discount of  Receivables.  The
Borrower shall not and shall not permit any of its Restricted  Subsidiaries  to,
discount  or sell with  recourse,  or sell for less than the greater of the face
value  or  market  value  thereof,  any  of its  notes  receivable  or  accounts
receivable.

                     6.12 Limitation on Transactions with Affiliates.  Except as
set forth on  Schedule  6.12,  enter into any  transaction,  including,  without
limitation,  any purchase,  sale, lease or exchange of property or the rendering
of any service,  with any  Affiliate  unless such  transaction  is (a) otherwise
permitted  or not  prohibited  under  this  Agreement  and  (b)  upon  fair  and
reasonable   terms  no  less  favorable  to  the  Borrower  or  such  Restricted
Subsidiary,  as the case may be,  than it would  obtain  in a  comparable  arm's
length transaction with a Person which is not an Affiliate.

                     6.13  Limitation  on  Changes  in Fiscal  Year.  Permit the
fiscal year of the Borrower to end on a day other than December 31.

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                                       51


                     6.14 Limitation on Negative Pledge Clauses. Enter into with
any Person any  agreement,  other than (a) this Agreement and (b) any industrial
revenue bonds,  purchase money mortgages or Financing  Leases  permitted by this
Agreement (in which cases, any prohibition or limitation shall only be effective
against the assets financed  thereby),  which prohibits or limits the ability of
the Borrower or any of its Restricted  Subsidiaries to create,  incur, assume or
suffer to exist any Lien upon any of its property,  assets or revenues,  whether
now owned or hereafter acquired unless the prohibitions or limitations contained
in such  agreement  would only restrict such Liens if they were not also made to
secure the  obligations  of the Borrower or a Restricted  Subsidiary  under such
agreement or a related  agreement equally and ratably with the obligations which
such Liens were created to secure.

                     6.15  Limitation  on  Lines  of  Business.  Enter  into any
business,  either directly or through any Restricted Subsidiary,  except for the
commercial radio business (which shall be deemed to include, without limitation,
programming, production and distribution) and businesses related thereto.


                          SECTION 7. EVENTS OF DEFAULT

                      If  any  of  the  following  events  shall  occur  and  be
           continuing:

                     (a) The  Borrower  shall fail to pay any  principal  of any
           Loan when due in accordance  with the terms  hereof;  or the Borrower
           shall  fail to pay any  interest  on any Loan,  or any  other  amount
           payable hereunder,  within five days after any such interest or other
           amount becomes due in accordance with the terms hereof; or

                     (b) Any  representation  or warranty made or deemed made by
           the  Borrower  or any other  Loan  Party  herein or in any other Loan
           Document or which is contained in any certificate  furnished by it at
           any time under or in connection with this Agreement or any such other
           Loan  Document  shall prove to have been  incorrect  in any  material
           respect on or as of the date made or deemed made; or

                     (c)  The  Borrower  shall  default  in  the  observance  or
           performance  of any  agreement  contained  in Section 6 (except  that
           defaults  under  subsections  6.3 and 6.10 shall not become Events of
           Default unless they have been unremedied for a period of 15 days); or

                     (d) The  Borrower or any other Loan Party shall  default in
           the  observance or performance  of any other  agreement  contained in
           this Agreement or any other Loan Document  (other than as provided in
           paragraphs (a) through (c) of this  Section),  and such default shall
           continue  unremedied  for a period of 30 days after the  Borrower  or
           such Loan Party, as the case may be, obtains actual knowledge thereof
           or after notice thereof to the Borrower by the  Administrative  Agent
           or any Lender (through the Administrative Agent); or

                      (e) The  Borrower  or any of its  Restricted  Subsidiaries
           shall (i) default in any payment of  principal  of or interest on any
           Indebtedness  (other  than  the  Loans)  or in  the  payment  of  any

<PAGE>

                                       52


           Guarantee Obligation, beyond the period of grace, if any, provided in
           the  instrument  or agreement  under which such  Indebtedness  or the
           obligations  that are the subject of such  Guarantee  Obligation  was
           created;  or (ii) default in the  observance  or  performance  of any
           other  agreement or condition  relating to any such  Indebtedness  or
           Guarantee  Obligation  or  contained in any  instrument  or agreement
           evidencing,  securing or relating  thereto,  or any other event shall
           occur or condition  exist, the effect of which default or other event
           or condition is to cause,  or to permit the holder or holders of such
           Indebtedness  or  beneficiary  or  beneficiaries  of  such  Guarantee
           Obligation (or a trustee or agent on behalf of such holder or holders
           or beneficiary or  beneficiaries) to cause, with the giving of notice
           if  required,  such  Indebtedness  to become  due prior to its stated
           maturity or such Guarantee  Obligation to become  payable;  provided,
           however,  that no Default or Event of Default  shall exist under this
           paragraph  unless  the  aggregate   amount  of  Indebtedness   and/or
           Guarantee  Obligations in respect of which any default or other event
           or condition  referred to in this paragraph shall have occurred shall
           be equal to at least $1,000,000; or

                     (f) (i) The Borrower or any of its Restricted  Subsidiaries
           shall  commence  any case,  proceeding  or other action (A) under any
           existing  or future law of any  jurisdiction,  domestic  or  foreign,
           relating  to  bankruptcy,  insolvency,  reorganization  or  relief of
           debtors,  seeking to have an order for relief entered with respect to
           it, or seeking to adjudicate  it a bankrupt or insolvent,  or seeking
           reorganization,  arrangement,  adjustment,  winding-up,  liquidation,
           dissolution,  composition  or other  relief with respect to it or its
           debts, or (B) seeking appointment of a receiver,  trustee, custodian,
           conservator  or  other  similar  official  for it or  for  all or any
           substantial  part  of  its  assets,  or  the  Borrower  or any of its
           Restricted  Subsidiaries  shall  make a  general  assignment  for the
           benefit of its  creditors;  or (ii) there shall be commenced  against
           the  Borrower  or  any  of  its  Restricted  Subsidiaries  any  case,
           proceeding  or other  action of a nature  referred  to in clause  (i)
           above  which (A)  results  in the entry of an order for relief or any
           such   adjudication  or  appointment  or  (B)  remains   undismissed,
           undischarged  or  unbonded  for a period of 60 days;  or (iii)  there
           shall be  commenced  against the  Borrower  or any of its  Restricted
           Subsidiaries any case, proceeding or other action seeking issuance of
           a warrant of  attachment,  execution,  distraint  or similar  process
           against all or any  substantial  part of its assets which  results in
           the entry of an order for any such  relief  which shall not have been
           vacated,  discharged,  or stayed or bonded  pending  appeal within 60
           days  from the  entry  thereof;  or (iv) the  Borrower  or any of its
           Restricted  Subsidiaries  shall take any action in furtherance of, or
           indicating its consent to,  approval of, or  acquiescence  in, any of
           the acts set forth in clause (i),  (ii),  or (iii) above;  or (v) the
           Borrower or any of its Restricted  Subsidiaries  shall generally not,
           or shall be unable to, or shall  admit in writing its  inability  to,
           pay its debts as they become due; or

                     (g)  (i)  Any  Person  shall  engage  in  any   "prohibited
           transaction"  (as defined in Section 406 of ERISA or Section  4975 of
           the  Code)  involving  any  Plan,  (ii)  any   "accumulated   funding
           deficiency"  (as  defined  in Section  302 of ERISA),  whether or not
           waived,  shall exist with respect to any Single  Employer Plan or any
           Lien in favor of the PBGC or a Plan shall  arise on the assets of the
           Borrower or any Commonly Controlled Entity,  (iii) a Reportable Event


<PAGE>

                                       53


           shall occur with respect to, or proceedings  shall commence to have a
           trustee appointed,  or a trustee shall be appointed, to administer or
           to terminate,  any Single Employer Plan,  which  Reportable  Event or
           commencement  of  proceedings  or appointment of a trustee is, in the
           reasonable  opinion of the Majority Lenders,  likely to result in the
           termination of such Plan for purposes of Title IV of ERISA,  (iv) any
           Single  Employer  Plan shall  terminate  for  purposes of Title IV of
           ERISA, (v) the Borrower or any Commonly  Controlled  Entity shall, or
           in the reasonable opinion of the Majority Lenders is likely to, incur
           any liability in connection with a withdrawal from, or the Insolvency
           or Reorganization of, a Multiemployer Plan or (vi) any other event or
           condition  shall occur or exist with  respect to a Plan;  and in each
           case in clauses (i)  through  (vi)  above,  such event or  condition,
           together  with all other such  events or  conditions,  if any,  could
           reasonably be expected to have a Material Adverse Effect; or

                     (h) One or more  judgments  or  decrees  shall  be  entered
           against the Borrower or any of its Restricted  Subsidiaries involving
           in the  aggregate a  liability  (to the extent not paid or covered by
           insurance) of $1,000,000 or more,  and all such  judgments or decrees
           shall not have been  vacated,  discharged,  stayed or bonded  pending
           appeal within 60 days from the entry thereof; or

                     (i) The  Guarantee  shall cease,  for any reason,  to be in
           full force and effect with respect to any  Guarantor or any Guarantor
           shall so assert; or

                     (j)  The  Management   Agreement  shall  be  terminated  or
           otherwise cease to be in full force and effect, or the Borrower is or
           becomes entitled to terminate the Management  Agreement under Section
           3.2(b)(ii) thereof; or

                     (k) (i) less than  one-third of the members of the Board of
           Directors of the Borrower shall be persons designated by INI, or (ii)
           less than a majority of the members of the Board of  Directors of the
           Borrower  shall be  designated  by INI or persons  designated  in the
           manner provided in Section 1(a) of the Voting Agreement; or

                     (l) A Default of the type  described in paragraph (e) above
           shall  have   occurred  and  be   continuing   with  respect  to  the
           Indebtedness  of an  Unrestricted  Subsidiary and as a result thereof
           the  Borrower  or any of its  Restricted  Subsidiaries  shall  become
           liable for such  Indebtedness,  in each case, whether by operation of
           law,  pursuant to contract or otherwise,  or any holder or holders of
           such Indebtedness shall so assert in writing in any proceeding before
           a court or other adjudicatory body of competent  jurisdiction and the
           Majority Lenders shall determine, in the exercise of their reasonable
           judgment, that the Borrower and/or any of its Restricted Subsidiaries
           is reasonably  likely to incur a liability as a result  thereof which
           would constitute a Material Adverse Effect; or

                     (m)  The  Borrower  or any of its  Restricted  Subsidiaries
           shall incur any  liability  (not paid or fully  covered by insurance)
           under any Environmental Law in an amount which constitutes a Material
           Environmental Amount;


<PAGE>

                                       54


then, and in any such event, (A) if such event is an Event of Default  specified
in clause  (i) or (ii) of  paragraph  (f) of this  Section  with  respect to the
Borrower,  automatically  the Commitments  shall  immediately  terminate and the
Loans  hereunder  (with  accrued  interest  thereon) and all other amounts owing
under this Agreement shall immediately  become due and payable,  and (B) if such
event is any other Event of Default, either or both of the following actions may
be taken: (i) with the consent of the Majority Lenders, the Administrative Agent
may, or upon the  request of the  Majority  Lenders,  the  Administrative  Agent
shall,  by notice to the  Borrower  declare  the  Commitments  to be  terminated
forthwith,  whereupon the Commitments shall immediately terminate; and (ii) with
the consent of the Majority Lenders,  the Administrative  Agent may, or upon the
request of the Majority Lenders,  the  Administrative  Agent shall, by notice to
the Borrower,  declare the Loans hereunder (with accrued  interest  thereon) and
all other amounts owing under this  Agreement  (including,  without  limitation,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have  presented  the  documents  required  thereunder)  to be  due  and  payable
forthwith, whereupon the same shall immediately become due and payable.

                     Except as expressly provided above in this Section,  to the
extent permitted by applicable law, presentment,  demand,  protest and all other
notices of any kind are hereby expressly waived.


                       SECTION 8. THE ADMINISTRATIVE AGENT

                     8.1 Appointment.  Each Lender hereby irrevocably designates
and appoints the Administrative  Agent as the administrative  agent and BOA, BOB
and BOM as the Co-Agents of such Lender under this  Agreement and the other Loan
Documents,  and each such Lender irrevocably authorizes the Administrative Agent
and BOA,  BOB and BOM as the  Co-Agents  to take such action on its behalf under
the  provisions of this  Agreement and the other Loan  Documents and to exercise
such  powers  and  perform  such  duties  as  are  expressly  delegated  to  the
Administrative Agent and the Co-Agents, as the case may be, by the terms of this
Agreement and the other Loan  Documents,  together with such other powers as are
reasonably  incidental  thereto.  Notwithstanding  any provision to the contrary
elsewhere in this Agreement,  the Administrative Agent shall not have any duties
or  responsibilities,  except those expressly set forth herein, or any fiduciary
relationship   with  any   Lender,   and  no   implied   covenants,   functions,
responsibilities,  duties,  obligations or  liabilities  shall be read into this
Agreement  or  any  other  Loan   Document  or  otherwise   exist   against  the
Administrative  Agent. The Co-Agents,  in their capacity as such, shall not have
any duties or reponsibilities  hereunder nor any fiduciary relationship with any
Lender,  and  no  implied  covenants,   functions,   responsibilities,   duties,
obligations or  liabilities  shall be read into this Agreement or any other Loan
Document or otherwise exist against the Co-Agents in their capacity as such.

                     8.2  Delegation  of Duties.  The  Administrative  Agent may
execute any of its duties under this  Agreement and the other Loan  Documents by
or  through  agents  or  attorneys-in-fact  and shall be  entitled  to advice of
counsel  concerning all matters  pertaining to such duties.  The  Administrative
Agent shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact or counsel selected by it with reasonable care.


<PAGE>

                                       55


                     8.3  Exculpatory  Provisions.  Neither  the  Administrative
Agent nor any of its officers, directors,  employees, agents,  attorneys-in-fact
or Affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person  under or in  connection  with this  Agreement or any
other Loan  Document  (except for its or such  Person's own gross  negligence or
willful  misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements,  representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the  Administrative  Agent under or in connection  with, this
Agreement or any other Loan Document or for the value, validity,  effectiveness,
genuineness,  enforceability  or sufficiency of this Agreement or any other Loan
Document or for any failure of the Borrower to perform its obligations hereunder
or thereunder. The Administrative Agent shall not be under any obligation to any
Lender to ascertain or to inquire as to the  observance or performance of any of
the agreements  contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of the Borrower.

                     8.4 Reliance by  Administrative  Agent. The  Administrative
Agent shall be entitled to rely, and shall be fully  protected in relying,  upon
any Note, writing, resolution, notice, consent, certificate,  affidavit, letter,
telecopy,  telex or  teletype  message,  statement,  order or other  document or
conversation  believed by it in good faith to be genuine and correct and to have
been  signed,  sent or made by the proper  Person or Persons and upon advice and
statements  of legal  counsel  (including,  without  limitation,  counsel to the
Borrower),   independent   accountants   and  other  experts   selected  by  the
Administrative  Agent. The Administrative  Agent may deem and treat the payee of
any Note as the  owner  thereof  for all  purposes  unless a  written  notice of
assignment,  negotiation  or  transfer  thereof  shall  have been filed with the
Administrative  Agent.  The  Administrative  Agent shall be fully  justified  in
failing or refusing to take any action  under this  Agreement  or any other Loan
Document  unless  it shall  first  receive  such  advice or  concurrence  of the
Majority Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction  by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative  Agent  shall in all cases be fully  protected  in acting,  or in
refraining  from acting,  under this  Agreement and the other Loan  Documents in
accordance  with a request of the  Majority  Lenders,  and such  request and any
action  taken or failure to act pursuant  thereto  shall be binding upon all the
Lenders and all future holders of the Loans.

                     8.5 Notice of Default.  The Administrative  Agent shall not
be deemed to have  knowledge or notice of the occurrence of any Default or Event
of Default hereunder unless the Administrative  Agent has received notice from a
Lender or the Borrower  referring to this Agreement,  describing such Default or
Event of Default and stating that such notice is a "notice of  default".  In the
event that the  Administrative  Agent receives such a notice, the Administrative
Agent shall give notice thereof to the Lenders.  The Administrative  Agent shall
take such  action with  respect to such  Default or Event of Default as shall be
reasonably directed by the Majority Lenders;  provided that unless and until the
Administrative  Agent shall have received such  directions,  the  Administrative
Agent may (but shall not be  obligated  to) take such  action,  or refrain  from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.

<PAGE>

                                       56


                     8.6 Non-Reliance on Administrative Agent and Other Lenders;
Lender  Representations.  Each Lender  expressly  acknowledges  that neither the
Administrative  Agent nor any of its  officers,  directors,  employees,  agents,
attorneys-in-fact or Affiliates has made any representations or warranties to it
and that no act by the  Administrative  Agent hereinafter  taken,  including any
review  of the  affairs  of the  Borrower,  shall be deemed  to  constitute  any
representation  or warranty  by the  Administrative  Agent to any  Lender.  Each
Lender  represents to the  Administrative  Agent 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
appraisal  of  and  investigation  into  the  business,  operations,   property,
financial and other condition and  creditworthiness of the Borrower and made its
own decision to make its Loans  hereunder  and enter into this  Agreement.  Each
Lender also represents 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 deem  appropriate at the time,  continue to make its own
credit  analysis,  appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents,  and to make such  investigation as
it deems  necessary to inform itself as to the business,  operations,  property,
financial and other condition and  creditworthiness of the Borrower.  Except for
notices,  reports and other documents  expressly required to be furnished to the
Lenders by the Administrative  Agent hereunder,  the Administrative  Agent shall
not have any duty or  responsibility  to provide  any Lender  with any credit or
other  information  concerning  the business,  operations,  property,  condition
(financial or otherwise),  prospects or  creditworthiness  of the Borrower which
may come into the possession of the Administrative Agent or any of its officers,
directors,  employees,  agents,  attorneys-in-fact  or  Affiliates.  Each Lender
represents  to each  other  party  hereto  that it is a bank,  savings  and loan
association or other similar savings institution,  insurance company, investment
fund  or  company  or  other  financial  institution  which  makes  or  acquires
commercial   loans  in  the  ordinary  course  of  its  business,   that  it  is
participating  hereunder as a Lender for such commercial  purposes,  and that it
has the knowledge and  experience to be and is capable of evaluating  the merits
and risks of being a Lender  hereunder.  Each Lender  acknowledges and agrees to
comply with the provision of subsection 9.6 applicable to the Lenders hereunder.

                     8.7  Indemnification.  The Lenders  agree to indemnify  the
Administrative  Agent in its capacity as such (to the extent not  reimbursed  by
the Borrower  and without  limiting  the  obligation  of the Borrower to do so),
ratably  according to their respective  Applicable  Percentages in effect on the
date  on  which  indemnification  is  sought,  from  and  against  any  and  all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs,  expenses or  disbursements  of any kind whatsoever which may at any time
(including,  without limitation, at any time following the payment of the Loans)
be imposed on, incurred by or asserted against the  Administrative  Agent in any
way relating to or arising out of, the Commitments,  this Agreement,  any of the
other Loan Documents or any documents  contemplated  by or referred to herein or
therein or the transactions  contemplated  hereby or thereby or any action taken
or omitted by the  Administrative  Agent under or in connection  with any of the
foregoing;  provided  that no Lender  shall be  liable  for the  payment  of any
portion of such liabilities,  obligations,  losses, damages, penalties, actions,
judgments,  suits,  costs,  expenses or disbursements  resulting solely from the
Administrative Agent's gross negligence or willful misconduct.  In the event any
such  amounts  are  subsequently  paid  by or on  behalf  of the  Borrower,  the

<PAGE>

                                       57


Administrative  Agent shall  promptly  forward such amounts to the  indemnifying
Lenders.  The  agreements  in this  subsection  shall survive the payment of the
Loans and all other amounts payable hereunder.

                     8.8 Administrative  Agent in Its Individual  Capacity.  The
Administrative  Agent and its Affiliates may make loans to, accept deposits from
and  generally  engage in any kind of business  with the  Borrower as though the
Administrative  Agent were not the Administrative  Agent hereunder and under the
other Loan Documents.  With respect to the Loans made by it, the  Administrative
Agent shall have the same rights and powers under this  Agreement  and the other
Loan Documents as any Lender and may exercise the same as though it were not the
Administrative  Agent,  and the terms  "Lender" and "Lenders"  shall include the
Administrative Agent in its individual capacity.

                     8.9 Successor Agents. The Administrative  Agent and each of
the Co-Agents may resign as  Administrative  Agent and as Co-Agent,  as the case
may be, upon 10 days' notice to the Lenders.  If the Administrative  Agent shall
resign  as  Administrative  Agent  under  this  Agreement  and  the  other  Loan
Documents,  then the  Majority  Lenders  shall  appoint from among the Lenders a
successor  agent for the Lenders,  which successor agent (provided that it shall
have been approved by the  Borrower),  shall  succeed to the rights,  powers and
duties of the  Administrative  Agent hereunder.  Effective upon such appointment
and approval,  the term "Administrative  Agent" shall mean such successor agent,
and  the   former   Administrative   Agent's   rights,   powers  and  duties  as
Administrative  Agent shall be  terminated,  without any other or further act or
deed on the part of such  former  Administrative  Agent or any of the parties to
this  Agreement or any holders of the Loans.  After any retiring  Administrative
Agent's or Co-Agent's  resignation as Administrative  Agent or Co-Agent,  as the
case may be, the  provisions  of this Section 8 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Administrative Agent
or  Co-Agent,  as the case may be,  under  this  Agreement  and the  other  Loan
Documents.


                            SECTION 9. MISCELLANEOUS

                     9.1 Amendments and Waivers.  Neither this Agreement nor any
other  Loan  Document,   nor  any  terms  hereof  or  thereof  may  be  amended,
supplemented  or  modified  except in  accordance  with the  provisions  of this
subsection.  The  Majority  Lenders  may,  or, with the  written  consent of the
Majority  Lenders,  the  Administrative  Agent may, from time to time, (a) enter
into with the Borrower written amendments,  supplements or modifications  hereto
and to the other Loan Documents for the purpose of adding any provisions to this
Agreement  or the other Loan  Documents  or changing in any manner the rights of
the Lenders or of the Borrower  hereunder or  thereunder  or (b) waive,  on such
terms and conditions as the Majority Lenders or the Administrative Agent, as the
case may be, may specify in such  instrument,  any of the  requirements  of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences;  provided,  however,  that no such  waiver and no such  amendment,
supplement or  modification  shall (i) reduce the amount or extend the scheduled
date of maturity of any Loan or of any  installment  thereof or of any reduction
of the Revolving Credit Commitments required pursuant to subsection 2.4(b) to be
made on any Mandatory  Reduction Date, or reduce the rate of any interest or fee
payable  hereunder  or extend  the  scheduled  date of any  payment  thereof  or

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                                       58


increase the amount or extend theexpiration date of any Lender's Commitments, in
each case without the prior written consent of each Lender affected thereby,  or
(ii) amend,  modify or waive any  provision of this  subsection or reduce any of
the percentages  specified in the definition of Majority Lenders,  or consent to
the assignment or transfer by the Borrower of any of its rights and  obligations
under this  Agreement  and the other Loan  Documents,  in each case  without the
prior  written  consent of all the  Lenders,  (iii)  amend,  modify or waive any
provision of subsections  2.1 through 2.4, 2.21 and  subsections 2.8 and 2.9 (to
the extent such  subsections  relate to the  Revolving  Credit  Commitments)  or
reduce any of the percentages  specified in the definition of Majority Revolving
Credit  Lenders  without the prior  written  consent of the  Majority  Revolving
Credit  Lenders,  (iv) amend,  modify or waive any provision of subsections  2.5
through 2.9 (to the extent such subsections  relate to the Term Loans) or reduce
any of the  percentages  specified in the  definition  of Majority  Term Lenders
without the written consent of the Majority Term Lenders,  or (v) amend,  modify
or waive any  provision  of Section 8 without  the  written  consent of the then
Administrative  Agent or the Co-Agents,  as applicable.  Any such waiver and any
such amendment,  supplement or  modification  shall apply equally to each of the
Lenders and shall be binding upon the Borrower,  the Lenders, the Administrative
Agent and all  future  holders  of the  Loans.  In the case of any  waiver,  the
Borrower,  the Lenders and the  Administrative  Agent shall be restored to their
former  positions and rights  hereunder and under the other Loan Documents,  and
any  Default  or Event of  Default  waived  shall be  deemed to be cured and not
continuing;  no such waiver shall extend to any  subsequent  or other Default or
Event of Default or impair any right consequent thereon.

                     9.2 Notices.  All notices,  requests and demands to or upon
the respective  parties hereto to be effective shall be in writing (including by
facsimile  transmission) and, unless otherwise expressly provided herein,  shall
be deemed to have been duly given or made (a) in the case of  delivery  by hand,
when  delivered,  (b) in the case of  delivery  by mail,  three days after being
deposited  in the mails,  postage  prepaid,  or (c) in the case of  delivery  by
facsimile transmission,  when sent and receipt has been confirmed,  addressed as
specified  under  the  caption  "Address  for  Notices"  below  its  name on the
signature pages hereof or to such other address as may be hereafter  notified by
the respective parties hereto; provided that any notice, request or demand to or
upon the  Administrative  Agent or the Lenders  pursuant to subsection 2.2, 2.4,
2.6, 2.8 or 2.10 shall not be effective until received.

                     9.3 No Waiver;  Cumulative Remedies. No failure to exercise
and no  delay in  exercising,  on the  part of the  Administrative  Agent or any
Lender, any right,  remedy, power or privilege hereunder or under the other Loan
Documents  shall  operate as a waiver  thereof;  nor shall any single or partial
exercise of any right,  remedy,  power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege.  The rights,  remedies,  powers and  privileges  herein  provided are
cumulative  and not  exclusive of any rights,  remedies,  powers and  privileges
provided by law.

                     9.4  Survival  of  Representations   and  Warranties.   All
representations  and warranties made hereunder,  in the other Loan Documents and
in any  document,  certificate  or  statement  delivered  pursuant  hereto or in
connection  herewith  shall survive the execution and delivery of this Agreement
and the making of the Loans hereunder.

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                                       59


                     9.5 Payment of Expenses and Taxes.  The Borrower agrees (a)
to  pay  or  reimburse  the   Administrative   Agent  for  all  its   reasonable
out-of-pocket  costs and expenses  incurred in connection with the  development,
preparation and execution of, and any amendment,  supplement or modification to,
this Agreement and the other Loan Documents and any other documents  prepared in
connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including, without limitation, the
reasonable fees and disbursements of counsel to the Administrative Agent, (b) to
pay or reimburse each Lender and the Administrative Agent for all its reasonable
costs and expenses  incurred in connection  with the enforcement or preservation
of any rights under this Agreement,  the other Loan Documents and any such other
documents,  including, without limitation, the reasonable fees and disbursements
of counsel to each  Lender and of counsel to the  Administrative  Agent,  (c) to
pay, indemnify, and hold each Lender and the Administrative Agent harmless from,
any and all recording and filing fees and any and all  liabilities  with respect
to, or  resulting  from any delay in paying,  stamp,  excise  and other  similar
taxes,  if any,  which may be payable or  determined to be payable in connection
with the execution and delivery of, or any amendment, supplement or modification
of, or any waiver or consent under or in respect of, this  Agreement,  the other
Loan Documents and any such other documents, and (d) to pay, indemnify, and hold
each Lender and the  Administrative  Agent harmless from and against any and all
other liabilities,  obligations, losses, damages, penalties, actions, judgments,
suits,  costs,  expenses or disbursements of any kind or nature  whatsoever with
respect  to  the  actual  or  proposed  use  of the  Loans,  including,  without
limitation,  any of the foregoing  relating to the  violation of,  noncompliance
with or liability under, any  Environmental  Law applicable to the operations of
the  Borrower,  any of its  Subsidiaries  or any  of  the  Properties  (all  the
foregoing  in this clause (d),  collectively,  the  "indemnified  liabilities"),
provided  that  the  Borrower   shall  have  no  obligation   hereunder  to  the
Administrative  Agent or any  Lender  with  respect to  indemnified  liabilities
arising  from  (i)  the  gross   negligence   or  willful   misconduct   of  the
Administrative  Agent or any such  Lender or (ii)  legal  proceedings  commenced
against the  Administrative  Agent or any such Lender by any security  holder or
creditor thereof arising out of and based upon rights afforded any such security
holder or  creditor  solely in its  capacity  as such.  The  agreements  in this
subsection  shall survive  repayment of the Loans and all other amounts  payable
hereunder.

                     9.6 Successors and Assigns; Participations and Assignments.
(a)  This  Agreement  shall be  binding  upon and  inure to the  benefit  of the
Borrower,  the Lenders, the Administrative Agent and their respective successors
and  assigns,  except that the  Borrower  may not assign or transfer  any of its
rights or obligations  under this Agreement without the prior written consent of
each Lender.

                     (b)  Any  Lender  may,  in  the  ordinary   course  of  its
commercial  banking  business and in accordance with applicable law, at any time
sell to one or more  banks  or  other  entities  ("Participants")  participating
interests in any Loan owing to such Lender, any Commitment of such Lender or any
other interest of such Lender  hereunder and under the other Loan Documents.  In
the  event  of any  such  sale by a  Lender  of a  participating  interest  to a
Participant, such Lender's obligations under this Agreement to the other parties
to this  Agreement  shall remain  unchanged,  such Lender  shall  remain  solely
responsible for the performance thereof,  such Lender shall remain the holder of
any  such  Loan  for all  purposes  under  this  Agreement  and the  other  Loan

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                                       60


Documents,  such Lender shall be solely responsible for any withholding taxes or
any filing or  reporting  requirements  relating to such  Participant  and shall
indemnify and hold harmless the Borrower and the Administrative  Agent and their
respective successors, permitted assigns, officers, directors, employees, agents
and  representatives  for and against any Non-Excluded Taxes (including interest
and  penalties  thereon  and  additions  thereto),  losses,  costs and  expenses
incurred  in  connection  with such  withholding  taxes or  filing or  reporting
requirement,  and the Borrower and the  Administrative  Agent shall  continue to
deal solely and  directly  with such  Lender in  connection  with such  Lender's
rights and  obligations  under this Agreement and the other Loan  Documents.  No
Lender  shall  be  entitled  to  create  in  favor  of any  Participant,  in the
participation  agreement  pursuant  to which  such  Participant's  participating
interest  shall be created  or  otherwise,  any right to vote on,  consent to or
approve any matter  relating to this Agreement or any other Loan Document except
for  those  specified  in  clauses  (i) and (ii) of the  proviso  to the  second
sentence of  subsection  9.1.  The Borrower  agrees that if amounts  outstanding
under this  Agreement  are due or unpaid,  or shall have been  declared or shall
have become due and payable  upon the  occurrence  of an Event of Default,  each
Participant  shall, to the maximum extent permitted by applicable law, be deemed
to have the right of setoff in respect of its participating  interest in amounts
owing  under  this  Agreement  to  the  same  extent  as if  the  amount  of its
participating  interest  were  owing  directly  to it  as a  Lender  under  this
Agreement,  provided  that,  in purchasing  such  participating  interest,  such
Participant  shall be  deemed  to have  agreed  to share  with the  Lenders  the
proceeds  thereof  as  provided  in  subsection  9.7(a) as fully as if it were a
Lender  hereunder.  All  amounts  payable by the  Borrower  to any Lender  under
subsections  2.17,  2.18 and 2.19 in  respect  of the Loans  held by it, and its
Commitments,  shall be  determined  as if such  Lender had not sold or agreed to
sell any  participations  in such Loans and  Commitments,  and as if such Lender
were funding and maintaining  each of such Loans and Commitments in the same way
that it is funding and  maintaining  the portion of such Loan and  Commitment in
which no participations have been sold.

                     (c)  Any  Lender  may,  in  the  ordinary   course  of  its
commercial  banking  business and in accordance with applicable law, at any time
and from time to time assign to any Lender or any affiliate thereof or, with the
consent of the Administrative Agent and, if no Default or Event of Default shall
have occurred and be continuing, the consent of the Borrower (which in each case
shall  not  be  unreasonably  withheld),  to an  additional  bank  or  financial
institution (an "Assignee") all or any part of its rights and obligations  under
this  Agreement  and the other Loan  Documents  pursuant  to an  Assignment  and
Acceptance,  substantially  in the form of Exhibit E, executed by such Assignee,
such assigning Lender (and, in the case of an Assignee that is not then a Lender
or an  affiliate  thereof,  by the Borrower  and the  Administrative  Agent) and
delivered to the  Administrative  Agent for its  acceptance and recording in the
Register, provided that, in the case of any such assignment by a Lender which is
not  assigning  all of its  Loans  and  Commitments,  the  sum of the  aggregate
principal  amount  of the  Loans  and the  aggregate  amount  of the  Term  Loan
Commitment and Available Revolving Credit Commitments being assigned is not less
than  $5,000,000  (or such lesser amount as may be agreed to by the Borrower and
the  Administrative  Agent).  Upon  such  execution,  delivery,  acceptance  and
recording,  from and  after  the  effective  date  determined  pursuant  to such
Assignment and Acceptance,  (x) the Assignee  thereunder shall be a party hereto
and, to the extent provided in such  Assignment and Acceptance,  have the rights
and  obligations  of a Lender  hereunder with a Commitment as set forth therein,

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                                       61


and (y) the assigning  Lender  thereunder  shall, to the extent provided in such
Assignment and Acceptance, be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance  covering all or the remaining
portion of an assigning  Lender's rights and  obligations  under this Agreement,
such  assigning  Lender shall cease to be a party hereto).  Notwithstanding  any
provision  of this  paragraph  (c) and  paragraph  (e) of this  subsection,  the
consent of the Borrower  shall not be  required,  and,  unless  requested by the
Assignee  and/or the  assigning  Lender,  new Notes  shall not be required to be
executed and delivered by the Borrower,  for any assignment  which occurs at any
time when any of the events described in Section 7(f) shall have occurred and be
continuing.

                     (d) The  Administrative  Agent,  on behalf of the Borrower,
shall maintain at the Administrative  Agent's Address for Notices referred to in
subsection 9.2 a copy of each  Assignment  and Acceptance  delivered to it and a
register (the  "Register") for the recordation of the names and addresses of the
Lenders and the  Commitments  of, and  principal  amounts of the Loans owing to,
each Lender from time to time.  The entries in the Register shall be conclusive,
in the absence of manifest error, and the Borrower, the Administrative Agent and
the Lenders may (and, in the case of any Loan or other obligation  hereunder not
evidenced  by a Note,  shall)  treat each  Person  whose name is recorded in the
Register  as the  owner of a Loan or other  obligation  hereunder  as the  owner
thereof  for all  purposes  of this  Agreement  and the  other  Loan  Documents,
notwithstanding any notice to the contrary.  Any assignment of any Loan or other
obligation  hereunder  not  evidenced  by a Note  shall be  effective  only upon
appropriate  entries  with  respect  thereto  being  made in the  Register.  The
Register  shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice.

                     (e)  Upon  its  receipt  of an  Assignment  and  Acceptance
executed by an assigning Lender and an Assignee (and, in the case of an Assignee
that is not then a Lender  or an  affiliate  thereof,  by the  Borrower  and the
Administrative  Agent)  together  with payment by the Assignee or the Lenders to
the  Administrative  Agent of a registration  and processing fee of $5,000,  the
Administrative  Agent shall (i) promptly  accept such  Assignment and Acceptance
and  (ii)  on  the  effective  date  determined   pursuant  thereto  record  the
information contained therein in the Register and give notice of such acceptance
and recordation to the Lenders and the Borrower.

                     (f) The Borrower  authorizes each Lender to disclose to any
Participant or Assignee (each, a "Transferee")  and any prospective  Transferee,
subject to the provisions of subsection 9.15, any and all financial  information
in such Lender's possession concerning the Borrower and its Affiliates which has
been  delivered to such Lender by or on behalf of the Borrower  pursuant to this
Agreement  or which  has been  delivered  to such  Lender by or on behalf of the
Borrower in connection with such Lender's credit  evaluation of the Borrower and
its  Affiliates  prior to becoming a party to this  Agreement.  No assignment or
participation  made or purported to be made to any Transferee shall be effective
without  the prior  written  consent of the  Borrower  if it would  require  the
Borrower to make any filing with any Governmental  Authority or qualify any Loan
or Note under the laws of any  jurisdiction,  and the Borrower shall be entitled
to request and receive such  information  and  assurances  as it may  reasonably
request from any Lender or any  Transferee to determine  whether any such filing
or participation is otherwise in accordance with the Requirements of Law.

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                                       62


                     (g) For avoidance of doubt,  the parties to this  Agreement
acknowledge  that the provisions of this  subsection  concerning  assignments of
Loans and Notes relate only to absolute  assignments and that such provisions do
not  prohibit  assignments  creating  security  interests,   including,  without
limitation,  any  pledge  or  assignment  by a Lender of any Loan or Note to any
Federal  Reserve Bank in  accordance  with  applicable  law;  provided  that any
transfer to an assignee upon the enforcement of any such security interest shall
be subject to the consent of the Borrower as provided herein.

                     9.7 Adjustments;  Set-off. (a) If any Lender (a "benefitted
Lender") shall at any time receive any payment of all or part of its Loans owing
to it, or  interest  thereon,  or receive  any  collateral  in  respect  thereof
(whether  voluntarily  or  involuntarily,  by  set-off,  pursuant  to  events or
proceedings  of the nature  referred to in Section  7(f),  or  otherwise),  in a
greater proportion than any such payment to or collateral  received by any other
Lender, if any, in respect of such other Lender's Loans owing to it, or interest
thereon, such benefitted Lender shall purchase for cash from the other Lenders a
participating interest in such portion of each such other Lender's Loan owing to
it,  or  shall  provide  such  other  Lenders  with  the  benefits  of any  such
collateral,  or the  proceeds  thereof,  as shall  be  necessary  to cause  such
benefitted  Lender to share the excess payment or benefits of such collateral or
proceeds ratably with each of the Lenders; provided, however, that if all or any
portion of such excess  payment or benefits is  thereafter  recovered  from such
benefitted Lender, such purchase shall be rescinded,  and the purchase price and
benefits returned, to the extent of such recovery, but without interest.

                     (b) In addition  to any rights and  remedies of the Lenders
provided by law,  each Lender shall have the right,  without prior notice to the
Borrower,  any such notice being expressly  waived by the Borrower to the extent
permitted by  applicable  law,  upon any amount  becoming due and payable by the
Borrower  hereunder  (whether  at  the  stated  maturity,   by  acceleration  or
otherwise) to set-off and  appropriate and apply against such amount any and all
deposits  (general or special,  time or demand,  provisional  or final),  in any
currency,  and any other credits,  indebtedness or claims,  in any currency,  in
each case  whether  direct or  indirect,  absolute  or  contingent,  matured  or
unmatured,  at any time  held or owing by such  Lender  or any  branch or agency
thereof to or for the credit or the account of the Borrower.  Each Lender agrees
promptly  to notify the  Borrower  and the  Administrative  Agent after any such
set-off and application  made by such Lender,  provided that the failure to give
such notice shall not affect the validity of such set-off and application.

                     9.8 Counterparts.  This Agreement may be executed by one or
more of the parties to this  Agreement  on any number of  separate  counterparts
(including  by  facsimile  transmission),  and  all of said  counterparts  taken
together shall be deemed to constitute one and the same instrument. A set of the
copies of this  Agreement  signed by all the  parties  shall be lodged  with the
Borrower and the Administrative Agent.

                     9.9 Severability.  Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction  shall, as to such jurisdiction,
be ineffective to the extent of such  prohibition  or  unenforceability  without
invalidating  the  remaining  provisions  hereof,  and any such  prohibition  or
unenforceability   in  any   jurisdiction   shall  not   invalidate   or  render
unenforceable such provision in any other jurisdiction.

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                                       63


                     9.10  Integration.   This  Agreement  and  the  other  Loan
Documents represent the agreement of the Borrower,  the Administrative Agent and
the  Lenders  with  respect  to the  subject  matter  hereof,  and  there are no
promises,  undertakings,  representations  or warranties  by the  Borrower,  the
Administrative  Agent or any Lender  relative to the subject  matter  hereof not
expressly set forth or referred to herein or in the other Loan Documents.

                     9.11  GOVERNING  LAW.  THIS  AGREEMENT  AND THE  RIGHTS AND
OBLIGATIONS  OF THE PARTIES  HEREUNDER  SHALL BE GOVERNED BY, AND  CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                     9.12  Submission To  Jurisdiction;  Waivers.  To the extent
permitted   by   applicable   law,   the   Borrower   hereby   irrevocably   and
unconditionally:

                     (a) submits for itself and its property in any legal action
           or proceeding relating to this Agreement and the other Loan Documents
           to which it is a party,  or for  recognition  and  enforcement of any
           judgement  in  respect   thereof,   to  the   non-exclusive   general
           jurisdiction  of the  Courts of the State of New York,  the courts of
           the  United  States  for  the  Southern  District  of New  York,  and
           appellate courts from any thereof;

                     (b)  consents  that any such  action or  proceeding  may be
           brought in such  courts and waives any  objection  that it may now or
           hereafter  have to the venue of any such action or  proceeding in any
           such  court or that  such  action or  proceeding  was  brought  in an
           inconvenient court and agrees not to plead or claim the same;

                     (c) agrees  that  service of process in any such  action or
           proceeding may be effected by mailing a copy thereof by registered or
           certified mail (or any substantially  similar form of mail),  postage
           prepaid,  to the Borrower at its address set forth in subsection  9.2
           or at such other address of which the Administrative Agent shall have
           been notified pursuant thereto;

                     (d) agrees that  nothing  herein  shall affect the right to
           effect  service of process in any other  manner  permitted  by law or
           shall limit the right to sue in any other jurisdiction; and

                     (e) waives,  to the maximum  extent not  prohibited by law,
           any  right it may have to claim or  recover  in any  legal  action or
           proceeding referred to in this subsection any punitive damages.

                     9.13  Acknowledgements.  The Borrower  hereby  acknowledges
that:

                      (a) it has been  advised by  counsel  in the  negotiation,
           execution  and  delivery  of  this   Agreement  and  the  other  Loan
           Documents;

                      (b)  neither the  Administrative  Agent nor any Lender has
           any fiduciary  relationship  with or duty to the Borrower arising out
           of or in  connection  with this  Agreement  or any of the other  Loan
           Documents,  and the relationship between the Administrative Agent and
           Lenders,  on one  hand,  and the  Borrower,  on the  other  hand,  in
           connection  herewith  or  therewith  is  solely  that of  debtor  and
           creditor; and

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                                       64


                     (c) no joint venture is created hereby or by the other Loan
           Documents  or  otherwise   exists  by  virtue  of  the   transactions
           contemplated  hereby  among the Lenders or among the Borrower and the
           Lenders.

                     9.14   WAIVERS   OF   JURY   TRIAL.   THE   BORROWER,   THE
ADMINISTRATIVE  AGENT AND THE LENDERS  HEREBY  IRREVOCABLY  AND  UNCONDITIONALLY
WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

                     9.15  Treatment of Certain Information; Confidentiality.

                     (a) The  Borrower  acknowledges  that (i)  services  may be
offered or provided to it (in  connection  with this  Agreement or otherwise) by
each Lender or by one or more subsidiaries or affiliates of such Lender and (ii)
information delivered to each Lender by the Borrower and its Subsidiaries may be
provided to each such  subsidiary and affiliate,  it being  understood  that any
such subsidiary or affiliate  receiving such  information  shall be bound by the
provisions of clause (b) below as if it were a Lender hereunder.

                     (b) Each  Lender and the  Administrative  Agent  agrees (on
behalf of itself and each of its affiliates,  directors, officers, employees and
representatives)  to  use  reasonable  precautions  to  keep  confidential,   in
accordance with its customary procedures for handling  confidential  information
of this nature and in  accordance  with safe and sound  banking  practices,  any
non-public information supplied to it by the Borrower pursuant to this Agreement
which is identified by the Borrower as being  confidential  at the time the same
is delivered to the Lenders or the Administrative Agent and which is not already
in such Lender's  possession on a nonconfidential  basis and is not subsequently
delivered to such Lender on a nonconfidential  basis by a Person who in so doing
has not violated a duty of confidentiality owing to the Borrower,  provided that
nothing  herein shall limit the  disclosure of any such  information  (i) to the
extent  required by statute,  rule,  regulation  or  judicial  process,  (ii) to
counsel for any of the Lenders or of the  Administrative  Agent,  (iii) at their
request,    to   bank   examiners   or   other   regulators   having   analogous
responsibilities,  (iv) to auditors or  accountants,  (v) to the  Administrative
Agent or any other Lender (or to Chase Securities Inc.), (vi) in connection with
any litigation arising under or in connection with the transactions contemplated
by this Agreement or any of the other Loan  Documents,  (vii) to a subsidiary or
affiliate  of such  Lender  as  provided  in  clause  (a) above or (viii) to any
assignee or participant (or prospective assignee or participant) so long as such
assignee or participant  (or prospective  assignee or participant)  agrees to be
bound by the provisions of this subsection.  In no event shall any Lender or the
Administrative  Agent be obligated or required to return any materials furnished
by the Borrower.

                     9.16 Senior Indebtedness. Each of the parties hereto agrees
that all of the  obligations  of the  Borrower  hereunder  and  under  any Notes
constitute "Senior Indebtedness" under and as defined in and for all purposes of
the 6-3/4% Debenture Indenture.

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                                       65


                     9.17  Release  of  Collateral.  On  the  Closing  Date  the
Administrative  Agent shall release its security interest (without any notice to
or vote or consent of any Lender) in the Collateral  under and as defined in the
Security Agreement, dated as of February 3, 1994, as amended, among the Obligors
(as defined therein) and The Chase Manhattan Bank, as  Administrative  Agent for
the lenders from time to time parties to the Existing Credit  Agreement.  On the
Closing  Date  and  at  any  time  and  from  time  to  time   thereafter,   the
administrative  agent shall return to the Borrower all securities  pledged under
such Security  Agreement and upon the reasonable  request of the Borrower and at
the Borrower's  expense shall execute and deliver such instruments and documents
and take such  actions as are  reasonably  necessary  to release  such  security
interest in the Collateral from any public record.

<PAGE>

                                       66


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

                               WESTWOOD ONE, INC.


                              By:
                              Title:

                              Address for Notices:
                              Westwood One, Inc.
                              c/o Infinity Broadcasting Corporation
                              600 Madison Avenue
                              New York, New York 10022
                              Attention: Mel Karmazin
                              Telecopier: (212) 888-2958
                              Telephone: (212) 750-6400

                              THE CHASE MANHATTAN BANK,
                                 as Administrative Agent
                                 and as a Lender


                              By:
                              Title:

                              Address for Notices:
                              The Chase Manhattan Bank
                              Agent Bank Services
                              140 East 45th Street, 29th Floor
                              New York, New York 10017
                              Attention: Sandra Miklave
                              Telecopier: (212) 622-0002
                              Telephone: (212) 622-0011

                              with a copy to:

                              The Chase Manhattan Bank
                              One Chase Manhattan Plaza
                              New York, New York 10081
                              Attention: James Kuster
                              Telecopier: (212) 552-4905
                              Telephone: (212) 552-3993

<PAGE>

                                THE FIRST NATIONAL BANK OF BOSTON,
                                as a Co-Agent and as a Lender


                              By:_______________________________
                                 Title:


                                 Address for Notices:
                                 The First National Bank of Boston
                                 100 Federal Street
                                 MS: 01-08-08
                                 Boston, MA 02110
                                 Attention: Reginald T. Dawson
                                 Telecopier: (617) 434-3401
                                 Telephone:  (617) 434-0788


<PAGE>






                               BANK OF AMERICA ILLINOIS,
                               as a Co-Agent and as a Lender


                               By:_______________________________
                                  Title:


                               Address for Notices:
                               Bank of America New York
                               335 Madison Avenue, 5th Floor
                               New York, NY 10017
                               Attention: Russell Solomon
                               Telecopier: (212) 503-7173
                               Telephone:  (212) 503-7648


<PAGE>






                                BANK OF MONTREAL,
                                as a Co-Agent and as a Lender


                                By:_______________________________
                                   Title:


                                Address for Notices:
                                Bank of Montreal
                                430 Park Avenue
                                New York, NY 10022
                                Attention: Andrew Moore
                                Telecopier: (212) 605-1621
                                Telephone:  (212) 605-1616


<PAGE>






                                THE BANK OF NEW YORK

                                By:_______________________________
                                   Title:


                                Address for Notices:
                                The Bank of New York
                                One Wall Street
                                16th Floor
                                New York, NY 10286
                                Attention: Peter Hanford
                                Telecopier: (212) 635-8593
                                Telephone:  (212) 635-8691


<PAGE>






                                 THE LONG-TERM CREDIT BANK OF
                                   JAPAN,  LTD.


                                  By:_______________________________
                                     Title:


                                  Address for Notices:
                                  The Long-Term Credit Bank of
                                  Japan Ltd., Los Angeles Agency
                                  350 South Grand Avenue
                                  Suite 3000
                                  Los Angeles, CA 90071
                                  Attention: Takaomi Tomioka
                                  Telecopier: (213) 622-6908
                                  Telephone:  (213) 689-6355


<PAGE>





                                  KEYBANK NATIONAL ASSOCIATION


                                  By:_______________________________
                                     Title:


                                  Address for Notices:
                                  127 Public Square
                                  Mail Code: OH0127-0602
                                  Cleveland, OH 44114
                                  Attention: Timothy Willard
                                  Telecopier: (216) 689-4666
                                  Telephone:  (216) 689-4458