Document:

EXHIBIT 10.1

                                                                  EXECUTION COPY

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                                 [QUANTA LOGO]

                                CREDIT AGREEMENT

                                   dated as of

                                  July 13, 2004

                                      among

                          QUANTA CAPITAL HOLDINGS LTD.,

                    VARIOUS DESIGNATED SUBSIDIARY BORROWERS,

                            The Lenders Party Hereto,

                              BANK OF AMERICA, N.A.
                                       and
                            CALYON, NEW YORK BRANCH,
                            as Co-Syndication Agents
                                       and
                              JPMORGAN CHASE BANK,
                             as Administrative Agent

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                          J.P. MORGAN SECURITIES INC.,

               as Advisor, Sole Lead Arranger and Sole Bookrunner

                                Table of Contents
                                   (continued)
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                            [J.P. MORGAN CHASE LOGO]

                                       ii

                                Table of Contents

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ARTICLE I             Definitions.................................................................................1

   Section 1.01.      Defined Terms...............................................................................1
   Section 1.02.      Classification of Loans and Borrowings.....................................................20
   Section 1.03.      Terms Generally............................................................................20
   Section 1.04.      Accounting Terms; GAAP.....................................................................20

ARTICLE II            The Credits................................................................................21

   Section 2.01.      Commitments................................................................................21
   Section 2.02.      Loans and Borrowings.......................................................................21
   Section 2.03.      Requests for Borrowings....................................................................22
   Section 2.04.      Funding of Borrowings......................................................................22
   Section 2.05.      Interest Elections.........................................................................23
   Section 2.06.      Termination and Reduction of Commitments...................................................24
   Section 2.07.      Repayment of Loans; Evidence of Debt.......................................................24
   Section 2.08.      Prepayment of Loans; Additional Borrowing Base Requirements................................25
   Section 2.09.      Fees.......................................................................................26
   Section 2.10.      Interest...................................................................................27
   Section 2.11.      Alternate Rate of Interest.................................................................27
   Section 2.12.      Increased Costs............................................................................28
   Section 2.13.      Break Funding Payments.....................................................................29
   Section 2.14.      Taxes......................................................................................30
   Section 2.15.      Payments Generally; Pro Rata Treatment; Sharing of Set-offs................................31
   Section 2.16.      Mitigation Obligations; Replacement of Lenders.............................................32
   Section 2.17.      Designated Subsidiary Borrowers............................................................34
   Section 2.18.      Extension of Commitment Expiration Date....................................................34

ARTICLE III           Letters of Credit..........................................................................35

   Section 3.01.      Several Letters of Credit..................................................................35
   Section 3.02.      Fronted Letters of Credit..................................................................36
   Section 3.03.      Conditions to the Issuance of all Letters of Credit........................................38
   Section 3.04.      Letter of Credit Requests..................................................................39
   Section 3.05.      Agreement to Repay Letter of Credit Drawings...............................................40
   Section 3.06.      Increased Costs............................................................................41
   Section 3.07.      Letter of Credit Expiration Extensions.....................................................41
   Section 3.08.      Changes to Stated Amount...................................................................42
   Section 3.09.      Existing Letters of Credit.................................................................42

ARTICLE IV            Representations and Warranties.............................................................42

   Section 4.01.      Corporate Status...........................................................................42
   Section 4.02.      Corporate Power and Authority..............................................................43
   Section 4.03.      No Contravention of Laws, Agreements or Organizational Documents...........................43
   Section 4.04.      Litigation and Contingent Liabilities......................................................43
   Section 4.05.      Use of Proceeds; Margin Regulations........................................................43
   Section 4.06.      Approvals..................................................................................43

                                Table of Contents
                                   (continued)

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   Section 4.07.      Investment Company Act.....................................................................44
   Section 4.08.      Public Utility Holding Company Act.........................................................44
   Section 4.09.      True and Complete Disclosure; Projections and Assumptions..................................44
   Section 4.10.      Financial Condition; Financial Statements..................................................44
   Section 4.11.      Tax Returns and Payments...................................................................45
   Section 4.12.      Compliance with ERISA......................................................................45
   Section 4.13.      Subsidiaries...............................................................................46
   Section 4.14.      Capitalization.............................................................................46
   Section 4.15.      Indebtedness...............................................................................46
   Section 4.16.      Compliance with Statutes, etc..............................................................46
   Section 4.17.      Insurance Licenses.........................................................................47
   Section 4.18.      Insurance Business.........................................................................47
   Section 4.19.      Security Documents.........................................................................47
   Section 4.20.      Properties; Liens..........................................................................47
   Section 4.21.      Solvency...................................................................................48
   Section 4.22.      Certain Insurance Regulations, Orders, Consents, Etc.......................................48

ARTICLE V             Conditions.................................................................................48

   Section 5.01.      Effective Date.............................................................................48
   Section 5.02.      Each Credit Event..........................................................................51

ARTICLE VI            Affirmative Covenants......................................................................52

   Section 6.01.      Information Covenants......................................................................52
   Section 6.02.      Books, Records and Inspections.............................................................54
   Section 6.03.      Insurance..................................................................................54
   Section 6.04.      Payment of Taxes...........................................................................55
   Section 6.05.      Maintenance of Existence...................................................................55
   Section 6.06.      Compliance with Statutes, etc..............................................................55
   Section 6.07.      ERISA......................................................................................55
   Section 6.08.      Maintenance of Property....................................................................56
   Section 6.09.      Maintenance of Licenses and Permits........................................................56
   Section 6.10.      End of Fiscal Years; Fiscal Quarters.......................................................56
   Section 6.11.      Borrowing Base Requirement.................................................................56
   Section 6.12.      Further Assurances.........................................................................56
   Section 6.13.      Existing Letters of Credit.................................................................57

ARTICLE VII           Negative Covenants.........................................................................57

   Section 7.01.      Changes in Business........................................................................57
   Section 7.02.      Consolidations, Mergers, Sales of Assets and Acquisitions..................................57
   Section 7.03.      Liens......................................................................................58
   Section 7.04.      Indebtedness...............................................................................61
   Section 7.05.      Issuance of Stock..........................................................................61
   Section 7.06.      Dissolution................................................................................61

                                      (ii)

                                Table of Contents
                                   (continued)
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   Section 7.07.      Restricted Payments........................................................................61
   Section 7.08.      Transactions with Affiliates...............................................................62
   Section 7.09.      Maximum Leverage Ratio.....................................................................62
   Section 7.10.      Minimum Consolidated Net Worth.............................................................62
   Section 7.11.      Limitation on Certain Restrictions on Subsidiaries.........................................62
   Section 7.12.      Private Act................................................................................63
   Section 7.13.      Claims Paying Ratings......................................................................63

ARTICLE VIII          Events of Default..........................................................................63

   Section 8.01.      Payments...................................................................................63
   Section 8.02.      Representations, etc.......................................................................63
   Section 8.03.      Covenants..................................................................................63
   Section 8.04.      Default under other Agreements.............................................................64
   Section 8.05.      Bankruptcy, etc............................................................................64
   Section 8.06.      ERISA......................................................................................65
   Section 8.07.      Judgments..................................................................................65
   Section 8.08.      Insurance Licenses.........................................................................65
   Section 8.09.      Change of Control..........................................................................65
   Section 8.10.      Security Documents.........................................................................65
   Section 8.11.      Company Guaranty...........................................................................65

ARTICLE IX            The Administrative Agent...................................................................66

   Section 9.01.      Appointment................................................................................66
   Section 9.02.      Administrative Agent in its Individual Capacity............................................66
   Section 9.03.      Exculpatory Provisions.....................................................................67
   Section 9.04.      Reliance...................................................................................67
   Section 9.05.      Delegation of Duties.......................................................................67
   Section 9.06.      Resignation................................................................................68
   Section 9.07.      Non-Reliance...............................................................................68
   Section 9.08.      Co-Syndication Agents......................................................................68

ARTICLE X             Company Guaranty...........................................................................68

   Section 10.01.     The Company Guaranty.......................................................................68
   Section 10.02.     Bankruptcy.................................................................................69
   Section 10.03.     Nature of Liability........................................................................69
   Section 10.04.     Independent Obligation.....................................................................69
   Section 10.05.     Authorization..............................................................................70
   Section 10.06.     Reliance...................................................................................71
   Section 10.07.     Subordination..............................................................................71
   Section 10.08.     Waiver.....................................................................................71

ARTICLE XI            Miscellaneous..............................................................................72

   Section 11.01.     Notices....................................................................................72
   Section 11.02.     Waivers; Amendments........................................................................73

                                     (iii)

                                Table of Contents
                                   (continued)
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   Section 11.03.     Expenses; Indemnity; Damage Waiver.........................................................74
   Section 11.04.     Successors and Assigns.....................................................................75
   Section 11.05.     Survival...................................................................................78
   Section 11.06.     Counterparts; Integration; Effectiveness...................................................79
   Section 11.07.     Severability...............................................................................79
   Section 11.08.     Right of Setoff............................................................................79
   Section 11.09.     Governing Law; Jurisdiction; Consent to Service of Process.................................79
   Section 11.10.     Waiver of Jury Trial.......................................................................80
   Section 11.11.     Headings...................................................................................80
   Section 11.12.     Confidentiality............................................................................81
   Section 11.13.     Interest Rate Limitation...................................................................81
   Section 11.14.     USA Patriot Act............................................................................82

SCHEDULES:

Schedule 2.01         --      Commitments
Schedule 2.17         --      Designated Subsidiary Borrowers
Schedule 3.09         --      Existing Letters of Credit
Schedule 4.13         --      Subsidiaries
Schedule 4.14         --      Capitalization
Schedule 4.15         --      Existing Indebteness
Schedule 4.17         --      Insurance Licenses
Schedule 7.03         --      Existing Liens

EXHIBITS:

Exhibit A             --      Form of Assignment and Assumption
Exhibit B             --      Form of Borrowing Base Certificate
Exhibit C                     Form of DSB Assumption Agreement
Exhibit D             --      Form Security Agreement
Exhibit E             --      Form of Borrowing Request
Exhibit F             --      Form of Officers' Certificate
Exhibit G             --      Form of Letter of Credit Request
Exhibit H             --      Form of Opinion of Designated Subsidiary Borrower's Counsel
Exhibit I-1           --      Form of Opinion of Borrower's Special New York Counsel
Exhibit I-2           --      Form of Opinion of Borrower's Special Bermuda Counsel
Exhibit J                     Form of Account Control Agreement

                                      (iv)

         CREDIT AGREEMENT dated as of July 13, 2004, among QUANTA CAPITAL
HOLDINGS LTD., an exempted company organized under the laws of Bermuda (the
"Company"), the Designated Subsidiary Borrowers (as hereinafter defined) from
time to time party hereto, the lenders from time to time party hereto (each, a
"Lender" and, collectively, the "Lenders"), JPMORGAN CHASE BANK, as
Administrative Agent and Bank of America, N.A. and Calyon, New York Branch, as
Co-Syndication Agents.

         The parties hereto agree as follows:

                                    ARTICLE I

                                   Definitions

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

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

         "Account Control Agreement" means the account control agreement,
substantially in the form of Exhibit J hereto, dated as of the date of this
Agreement, among JPMorgan Chase Bank, as Custodian, the Grantors (as defined in
the Security Agreement) from time to time party thereto and the Collateral
Agent, as amended, modified and supplemented and as in effect from time to time.

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

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

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

         "Advance Rate" means, for any category of Cash or obligation or
investment specified below in the column entitled "Cash and Eligible Securities"
(other than Cash, the "Eligible Securities"), the percentage set forth opposite
such category of Cash or Eligible Securities below in the column entitled
"Advance Rate" and, in each case, subject to the original term to maturity
criteria set forth therein:

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                             Cash and Eligible Securities:                                         Advance Rate:
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Cash:                                                                                                  100%

U.S. Dollars.
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Time Deposits, CDs and Money Market Deposits:                                   With maturities of two years or less from the date
                                                                                of determination, 90%.
Time deposits, certificates of deposit and money market deposits of
any commercial bank incorporated in the United States with a rating of
at least (i) AA- from S&P and (ii) Aa3 from Moody's.
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U.S. Government Securities:                                                     With maturities of (x) two years or less from the
                                                                                date of determination, 95%, (y) more than two
Securities issued or directly and fully guaranteed or insured by the            years to 10 years, 90% and (z) more than 10 years,
United States or any agency or instrumentality thereof (provided that           85%.
the full faith and credit of the United States is pledged in support
thereof).
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Investment Grade Municipal Bonds:
                                                                                With maturities of five years or less from the
Municipal Bonds rated at least (i) A from S&P and (ii) A2 from                  date of determination 85%.
Moody's.
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Investment Grade Non-Convertible Corporate Bonds Level I:                       With maturities of (x) two years or less from the
                                                                                date of determination, 90% and (y) more than two
Non-convertible corporate bonds which are "publicly traded" on a                years to 10 years from the date of determination,
nationally recognized exchange, eligible to be settled by the                   85%.
Depository Trust Company ("DTC") and rated at least (i) AA- from S&P
and (ii) Aa3 from Moody's.
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Investment Grade Non-Convertible Corporate Bonds Level II:                      With maturities of (x) two years or less from the
                                                                                date of determination, 85% and (y) more than two
Non-convertible corporate bonds which are "publicly traded" on a                years to 10 years from the date of determination,
nationally recognized exchange, eligible to be settled by DTC and               80%.
rated at least (i) A from S&P and (ii) A2 from Moody's, but no higher
than (x) A+ from S&P and (y) A1 from Moody's.
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Commercial Paper:                                                               With maturities of not more than one year from the
                                                                                date of determination, 90%.
Commercial paper issued by any entity organized in the United States
rated at least (i) A-1 or the equivalent thereof by S&P and (ii) P-1
or the equivalent thereof by Moody's.
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Other Securities:
                                                                                                  0.0%
All other investments, obligations or securities.

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                                       -2-

Notwithstanding the foregoing, (A) the value of Eligible Securities at any time
shall be determined based on the Report (as defined in the Security Agreement)
then most recently delivered by the Custodian to the Collateral Agent and (B) if
any single corporate issuer (or any Affiliate thereof) represents more than 10%
of the aggregate value of all Cash and Eligible Securities of the aggregate
amount of all Borrowing Bases, the excess over 10% shall be excluded (with such
exclusion being allocated in equal parts to each Borrowing Base at such time).

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

         "Agreement" means this Credit Agreement, as modified, supplemented,
amended, restated (including any amendment and restatement hereof), extended or
renewed from time to time.

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

         "Applicable Commitment Fee Rate" means 0.10%.

         "Applicable Insurance Regulatory Authority" means, when used with
respect to any Regulated Insurance Company, (x) the insurance department or
similar administrative authority or agency located in each state or jurisdiction
(foreign or domestic) in which such Regulated Insurance Company is domiciled or
(y) to the extent asserting regulatory jurisdiction over such Regulated
Insurance Company, the insurance department, authority or agency in each state
or jurisdiction (foreign or domestic) in which such Regulated Insurance Company
is licensed, and shall include any Federal or national insurance regulatory
department, authority or agency that may be created and that asserts insurance
regulatory jurisdiction over such Regulated Insurance Company.

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

         "Approved Fund" has the meaning assigned to such term in Section
11.04(b).

         "Assignment and Assumption" means an assignment and assumption entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 11.04), and accepted by the Administrative Agent, in the
form of Exhibit A or any other form approved by the Administrative Agent.

         "Authorized Officer" means, as to any Person, the Chief Executive
Officer, the President, the Chief Operating Officer, any Vice President, the
Secretary, or the Financial

                                      -3-

Officer of such Person or any other officer of such Person duly authorized by
such Person to act on behalf of such Person hereunder and under the other Credit
Documents.

         "Bankruptcy Code" has the meaning provided in Section 8.05.

         "Bermuda Companies Law" means the Companies Act 1981 of Bermuda and
other relevant Bermuda law.

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

         "Borrowers" means the Company and each Designated Subsidiary Borrower.

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

         "Borrowing Base" means, at any time, and in respect of each Borrower,
the aggregate amount of Cash and Eligible Securities held in the Collateral
Accounts of such Borrower under the Security Agreement at such time multiplied
in each case by the respective Advance Rates for Cash and such Eligible
Securities; provided that all Cash and Eligible Securities in respect of any
Borrowing Base shall only be included in such Borrowing Base to the extent same
are subject to a first priority perfected security interest in favor of the
Collateral Agent pursuant to the Security Documents.

         "Borrowing Base Certificate" means a Borrowing Base Certificate
substantially in the form of Exhibit B hereto.

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

         "Business Day" means (i) for all purposes other than as covered by
clause (ii) below, any day excluding Saturday, Sunday and any day which shall be
in the City of New York a legal holiday or a day on which banking institutions
are authorized by law or other governmental actions to close, and (ii) with
respect to all notices and determinations in connection with, and payments of
principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) and which is also a day for trading by and between banks
in the London interbank market.

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

         "Capital Markets Product" means, as to the Company or any Subsidiary,
any security, commodity, derivative transaction or other financial product
purchased, sold or entered into by such Person for the purpose of undertaking
one or more risks assumed by the Company

                                      -4-

or any Subsidiary in the ordinary course of business or managing one or more
risks otherwise assumed by the Company or any Subsidiary, including (i) any
structured insurance product, catastrophe bond, rate swap transaction, swap
option, basis swap, forward rate transaction, commodity swap, commodity option,
equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, currency swap transaction, cross-currency rate
swap transaction, currency option transaction, credit protection transaction,
credit swap, credit default swap, credit default option, equity default swap,
total return swap, credit spread transaction, repurchase transaction, reverse
repurchase transaction, buy/sellback transaction, securities lending
transaction, weather index transaction, emissions allowance transaction, or
forward purchase or sale of a security, commodity or other financial instrument
or interest (including any option with respect to any of these transactions),
(ii) which is a type of transaction that is similar to any transaction referred
to in clause (i) above that is currently, or in the future becomes, recurrently
entered into in the financial markets, (iii) any combination of the transactions
referred to in clauses (i) and (ii) above and (iv) any master agreement relating
to any of the transactions referred to in clauses (i), (ii) and (iii) above.

         "Cash Equivalents" means, as to any Person, (i) securities issued or
directly and fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than one
year from the date of acquisition, (ii) time deposits and certificates of
deposit of any commercial bank having, or which is the principal banking
subsidiary of a bank holding company organized under the laws of the United
States, any State thereof, the District of Columbia or any foreign jurisdiction
having, capital, surplus and undivided profits aggregating in excess of
$200,000,000, with maturities of not more than one year from the date of
acquisition by such Person, (iii) repurchase obligations with a term of not more
than 90 days for underlying securities of the types described in clause (i)
above entered into with any bank meeting the qualifications specified in clause
(ii) above, (iv) commercial paper rated at least A-1 or the equivalent thereof
by S&P or at least P-1 or the equivalent thereof by Moody's and in each case
maturing not more than one year after the date of acquisition by such Person,
(v) investments in money market funds substantially all of whose assets are
comprised of securities of the types described in clauses (i) through (iv)
above.

         "Change of Control" means (x) during any period of two consecutive
years, directors who at the beginning of such period constituted a majority of
the Board of Directors of the Company (together with any new directors whose
election by such Board or whose nomination for election by the stockholders of
the Company was approved by a vote of a majority of the directors then still in
office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the Board of Directors of the Company then in
office or (y) any "person" or "group" (as such terms are defined in Section
13(d) of the Securities Exchange Act of 1934, as amended) shall become the
beneficial owner, directly or indirectly of shares representing more than 40% of
the aggregate voting power represented by the issued and outstanding capital
stock of the Company.

         "Change in Law" means (a) the adoption of any law, rule or regulation
after the date of this Agreement, (b) any change in any law, rule or regulation
or in the interpretation or

                                      -5-

application thereof by any Governmental Authority after the date of this
Agreement or (c) compliance by any Lender (or, for purposes of Section 2.12(b),
by any lending office of such Lender or by such Lender's holding company, if
any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the date of this
Agreement.

         "Charges" has the meaning provided in Section 11.13.

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

         "Collateral" has the meaning provided in the Security Agreement.

         "Collateral Account" has the meaning provided in the Security
Agreement.

         "Collateral Agent" has the meaning provided in the Security Agreement.

         "Commitment" means, with respect to each Lender, at any time, the
amount set forth opposite such Lender's name on Schedule 2.01, as the same may
be reduced pursuant to Sections 2.06, 2.16 or 11.04.

         "Commitment Expiration Date" means the date occurring 364 days after
the Effective Date, or such later date to which the Commitment Expiration Date
shall have been extended pursuant to Section 2.18.

         "Company" means Quanta Capital Holdings Ltd., a company organized under
the laws of Bermuda.

         "Company Guaranty" means the guaranty of the Company provided in
Article X.

         "Consolidated Indebtedness" means, as of any date of determination, all
Indebtedness (other than with respect to Indebtedness described in clause (h) of
the definition thereof) of the Company and its Subsidiaries which at such time
would appear on the liability side of a balance sheet of such Persons prepared
on a consolidated basis in accordance with GAAP. For the avoidance of doubt,
"Consolidated Indebtedness" shall not include any Guarantees of any Person under
or in connection with letters of credit or similar facilities so long as no
drawings or payments have been made in respect thereof.

         "Consolidated Net Income" means, for any period, net income (or loss)
after income taxes of the Company and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP.

         "Consolidated Net Worth" means, as of any date of determination, the
Net Worth of the Company and its Subsidiaries determined on a consolidated basis
in accordance with GAAP after appropriate deduction for any minority interests
in Subsidiaries.

         "Consolidated Total Capital" means, as of any date of determination,
the sum of (i) Consolidated Indebtedness and (ii) Consolidated Net Worth at such
time.

                                      -6-

         "Control" means the possession, directly or indirectly, of the power
(i) to vote 10% or more of the voting power of the securities having ordinary
voting power for the election of directors of such corporation or (ii) to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.

         "Co-Syndication Agent" means each of Bank of America, N.A. and Calyon,
New York Branch, in their capacities as Co-Syndication Agents.

         "Credit Documents" means this Agreement, the promissory notes delivered
pursuant to Section 2.07(e) (if any) and each Security Document.

         "Credit Event" means the making of any Loan or the issuance of any
Letter of Credit (or any increase of the Stated Amount thereof).

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

         "Defaulting Lender" means any Lender with respect to which a Lender
Default is in effect.

         "Designated Subsidiary Borrower" means each Wholly-Owned Subsidiary of
the Company set forth on Schedule 2.17 and each Wholly-Owned Subsidiary of the
Company which is designated as a Designated Subsidiary Borrower in accordance
with Section 2.17.

         "Dividends" has the meaning provided in Section 7.07.

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

         "DSB Assumption Agreement" means an assumption agreement in the form of
Exhibit C.

         "Effective Date" means July 13, 2004.

         "Eligible Securities" has the meaning provided in the definition of the
term Advance Rates.

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

         "Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Company or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or

                                      -7-

threatened release of any Hazardous Materials into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed or imposed with respect to any of the foregoing.

         "Equity Interests" means, with respect to any Person, shares of capital
stock of (or other ownership or profit interests in) such Person, warrants,
options or other rights for the purchase or other acquisition from such Person
of shares of capital stock of (or other ownership or profit interests in) such
Person, securities convertible into or exchangeable for shares of capital stock
of (or other ownership or profit interests in) such Person or warrants, rights
or options for the purchase or other acquisition from such Person of such shares
(or such other interests), and other ownership or profit interests in such
Person (including, without limitation, partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such shares, warrants,
options, rights or other interests are authorized or otherwise existing on any
date of determination.

         "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the date
of this Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.

         "ERISA Affiliate" means any corporation or trade or business which is a
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as the Company or any of its Subsidiaries or is
under common control (within the meaning of Section 414(c) of the Code) with the
Company or any of its Subsidiaries.

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

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

         "Excluded Taxes" means, with respect to the Administrative Agent, any
Lender, or any other recipient of any payment to be made by or on account of any
obligation of any Borrower hereunder, (a) income or franchise taxes imposed on
(or measured by) its net income or net profits by any jurisdiction under the
laws of which such recipient is organized or in which its principal office is
located or, in the case of any Lender, in which its applicable lending office is
located, (b) any branch profits taxes imposed by the United States of America or
any similar tax imposed by any other jurisdiction in which the recipient is
located and (c) in the case of a Foreign Lender (other than an assignee pursuant
to a request by such Borrower under Section 2.16(b)), any withholding tax that
is imposed on amounts payable to such Foreign Lender at the time such Foreign
Lender becomes a party to this Agreement (or designates a new lending office) or
is attributable to such Foreign Lender's failure to comply with Section 2.14(e),
except to the extent that such Foreign Lender (or its assignor, if any) was
entitled, at the time of designation of a new lending office (or assignment), to
receive additional amounts from such Borrower with respect to such withholding
tax pursuant to Section 2.14(a).

                                      -8-

         "Existing Commitment Expiration Date" has the meaning provided in
Section 2.18(a).

         "Existing Letter of Credit" shall have the meaning provided in Section
3.09.

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

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

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

         "Foreign Pension Plan" means any plan, fund (including, without
limitation, any superannuation fund) or other similar program established or
maintained outside the United States of America by the Company or any one or
more of its Subsidiaries primarily for the benefit of employees of the Company
or such Subsidiaries residing outside the United States of America, which plan,
fund or other similar program provides, or results in, retirement income, a
deferral of income in contemplation of retirement or payments to be made upon
termination of employment, and which plan is not subject to ERISA or the Code.

         "Fronted Letter of Credit" has the meaning provided in Section 3.02(a).

         "Fronted Unpaid Drawing" has the meaning provided in clause (y) of
Section 3.05(a).

         "Fronting Arrangement" means an agreement or other arrangement by a
Regulated Insurance Company pursuant to which an insurer or insurers agree to
issue insurance policies at the request or on behalf of such Regulated Insurance
Company and such Regulated Insurance Company assumes the obligations in respect
thereof pursuant a Reinsurance Agreement or otherwise.

         "Fronting Lender" means JPMorgan Chase Bank, Calyon, New York Bank (and
any of their respective Affiliates) and any other Lender (or any Affiliate
thereof) which is requested by the Company, and which agrees in writing, to
issue Fronted Letters of Credit hereunder pursuant to Section 3.02; provided
that (x) in the case of JPMorgan Chase Bank (and its Affiliates), it shall not
be required to issue more than $12,500,000 in aggregate Stated Amount of all
Fronted Letters of Credits, and (y) in the case of Calyon, New York Branch (and

                                      -9-

its Affiliates), it shall not be required to issue more than $12,500,000 in
aggregate Stated Amount of all Fronted Letters of Credits issued by it or such
Affiliates.

         "Fronting Participant" has the meaning provided in Section 3.02(b).

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

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

         "Guarantee" of or by any Person (the "guarantor") means any obligation
guaranteeing or intended to guarantee any Indebtedness, leases, dividends or
other obligations ("primary obligations") of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent, (a) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (b) to advance or supply funds (i) for the purchase
or payment of any such primary obligation or (ii) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (c) 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 (d) otherwise to assure or hold harmless the owner of such primary
obligation against loss in respect thereof; provided, however, that the term
Guarantee shall not include (w) endorsements of instruments for deposit or
collection in the ordinary course of business, (x) obligations of any Regulated
Insurance Company under Insurance Contracts, Reinsurance Agreements, Fronting
Arrangements or Retrocession Agreements (including any Liens with respect
thereto) and (y) obligations under indemnities incurred in the ordinary course
of business or under stock purchase or asset purchase or sale agreements, or
which do not cover Indebtedness of the type described in clauses (a) through (i)
of the definition of Indebtedness. The amount of any Guarantee shall be deemed
to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Guarantee is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder) as determined by such
Person in good faith.

         "Guaranteed Creditors" means and includes each of the Administrative
Agent, the Collateral Agent, the Lenders and each LC Issuer.

         "Guaranteed Obligations" means all reimbursement obligations and Unpaid
Drawings with respect to Letters of Credit and all other obligations (including
obligations which, but for the automatic stay under Section 362(a) of the
Bankruptcy Code, would become due), liabilities and indebtedness owing by each
Designated Subsidiary Borrower to the Guaranteed Creditors under this Agreement
and each other Credit Document to which such Designated Subsidiary Borrower is a
party (including, without limitation, indemnities, fees and interest thereon
(including, in each case, any interest accruing after the commencement of any

                                      -10-

bankruptcy, insolvency, receivership or similar proceeding at the rate provided
for in the respective documentation, whether or not such interest is allowed in
any such proceeding)), whether now existing or hereafter incurred under, arising
out of or in connection with this Agreement and any such other Credit Document
and the due performance and compliance by each Designated Subsidiary Borrower
with all of the terms, conditions and agreements contained in all such Credit
Documents applicable to such Designated Subsidiary Borrower.

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

         "Indebtedness" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property acquired by such Person, (d) all obligations of
such Person in respect of the deferred purchase price of property or services,
(e) all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such Person, whether or not the
Indebtedness secured thereby has been assumed, provided that the amount of
Indebtedness of such Person shall be the lesser of (A) the fair market value of
such property at such date of determination (determined in good faith by the
Company) and (B) the amount of such Indebtedness of such other Person, (f) all
Guarantees by such Person of Indebtedness of others, (g) all Capital Lease
Obligations of such Person, (h) all obligations (or to the extent netting is
permitted under the applicable agreement governing such Capital Markets Products
and such netting is limited with respect to the counterparty or counterparties
of such agreement, all net termination obligations) of such Person under
transactions in Capital Markets Products, (i) all reimbursement obligations of
such Person in respect of letters of credit, letters of guaranty, bankers'
acceptances and similar credit transactions and (j) solely for purposes of
Section 8.04, all preferred or preference securities to the extent such
preferred or preference securities would constitute "debt" in accordance with
GAAP. The Indebtedness of any Person shall include the Indebtedness of any other
entity (including any partnership in which such Person is a general partner) to
the extent such Person is liable therefor as a result of such Person's ownership
interest in or other relationship with such entity, except to the extent the
terms of such Indebtedness provide that such Person is not liable therefor. For
the avoidance of doubt, Indebtedness shall not include (v) trade payables
(including payables under insurance contracts and reinsurance payables) and
accrued expenses in each case arising in the ordinary course of business, (w)
obligations and Guarantees of Regulated Insurance Companies with respect to
Policies, (x) obligations arising under deferred compensation plans of the
Company and its Subsidiaries in effect on the date hereof or which have been
approved by the board of directors of the Company or a committee thereof, (y)
obligations and Guarantees with respect to products underwritten by Regulated
Insurance Companies in the ordinary course of business, including insurance
policies, annuities, performance and surety bonds, assumptions of liabilities
and any related contingent obligations and (z) Reinsurance Agreements and
Fronting Arrangements and Guarantees thereof entered into by any Regulated
Insurance Company in the ordinary course of business.

                                      -11-

         "Indemnified Taxes" means Taxes other than Excluded Taxes.

         "Indemnitee" has the meaning provided in Section 11.03(b).

         "Information" has the meaning provided in Section 11.12.

         "Issuing Agent" means JPMorgan Chase Bank.

         "Insurance Business" means one or more aspects of the business of
selling, issuing or underwriting insurance or reinsurance.

         "Insurance Contract" means any insurance contract or policy issued by a
Regulated Insurance Company but shall not include any Reinsurance Agreement,
Fronting Arrangement or Retrocession Agreement.

         "Insurance Licenses" has the meaning provided in Section 4.17.

         "Interest Payment Date" means (a) with respect to any ABR Loan, the
last day of each March, June, September and December and (b) with respect to any
Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing
of which such Loan is a part and, in the case of a Eurodollar Borrowing with an
Interest Period of more than three months' duration, each day that would have
been an Interest Payment Date had successive Interest Periods of three months
duration been applicable to such Borrowing.

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

         "LC Issuer" means each of the Issuing Agent and each Fronting Lender.

         "Legal Requirements" means all applicable laws, rules and regulations
and interpretations thereof made by any governmental body or regulatory
authority (including, without limitation, any Applicable Insurance Regulatory
Authority) having jurisdiction over the Company or a Subsidiary of the Company.

         "Lender Default" means (i) the refusal (which has not been retracted)
of a Lender to make available its portion of any Borrowing or (ii) a Lender
having notified the

                                      -12-

Administrative Agent and/or each Borrower that it does not intend to comply with
its obligations under Section 2.01, in each case, as a result of the appointment
of a receiver or conservator with respect to such Lender at the direction or
request of any regulatory agency or authority.

         "Lenders" has the meaning provided in the first paragraph of this
Agreement.

         "Letter of Credit Fee" has the meaning provided in Section 2.09(c).

         "Letter of Credit Outstandings" means, at any time, the sum of (i) the
aggregate Stated Amount of all outstanding Several Letters of Credit, (ii) the
aggregate Stated Amount of all outstanding Fronted Letters of Credit and (iii)
the aggregate amount of all Unpaid Drawings in respect of all Letters of Credit
at such time.

         "Letter of Credit Request" has the meaning provided in Section 3.04(a).

         "Letter of Credit Supportable Obligations" means the obligations of the
Borrowers or any of their Subsidiaries which are permitted to exist pursuant to
the terms of this Agreement in connection with the principal lines of business
of such Borrower and its Subsidiaries.

         "Letters of Credit" means the Several Letters of Credit and the Fronted
Letters of Credit.

         "Leverage Ratio" means the ratio of (i) Consolidated Indebtedness plus
the aggregate liquidation preference of any preferred or preference securities
issued by the Company or any of its Subsidiaries to the extent such preferred or
preference securities would constitute "debt" in accordance with GAAP to (ii)
Consolidated Total Capital.

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

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

                                      -13-

         "Loan" has the meaning provided in Section 2.01(a).

         "Margin Stock" has the meaning provided in Regulation U.

         "Material Adverse Effect" means any material adverse condition or any
material adverse change in or affecting (x) the business, operations, property
or condition (financial or otherwise) of the Company and its Subsidiaries taken
as a whole or (y) the rights or remedies of the Lenders or the ability of the
Company and each Borrower to perform their respective obligations to the Lenders
under this Agreement or any other Credit Document.

         "Maximum Rate" has the meaning provided in Section 11.13.

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

         "Multiemployer Plan" means any multiemployer plan as defined in Section
4001(a)(3) of ERISA, which is maintained or contributed to by (or to which there
is an obligation to contribute of) the Company, any of its Subsidiaries or any
of its ERISA Affiliates, and each such plan for the five year period immediately
following the latest date on which the Company, such Subsidiary or such ERISA
Affiliate contributed to or had an obligation to contribute to such plan.

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

         "NAIC Approved Bank" means (a) any bank listed on the most current list
of banks approved by the Securities Valuation Office of the NAIC (the "NAIC Bank
List") or (b) any Lender as to which its confirming bank is a bank listed on the
NAIC Bank List.

         "Net Worth" means, as to any Person, the sum of its capital stock
(including, without limitation, its preferred stock), capital in excess of par
or stated value of shares of its capital stock (including, without limitation,
its preferred stock), retained earnings and any other account which, in
accordance with GAAP, constitutes stockholders equity, but excluding (i) any
treasury stock and (ii) the effects of Financial Accounting Statement No. 115.

         "Non-Continuing Lender" has the meaning provided in Section 2.18(b).

         "Non-Defaulting Lender" means each Lender other than a Defaulting
Lender.

         "Notice Date" has the meaning provided in Section 2.18(b).

         "Notice of Non-Extension" has the meaning provided in Section 3.07.

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

         "Participant" has the meaning set forth in Section 11.04(c)

                                      -14-

         "Patriot Act" has the meaning set forth in Section 11.14.

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

         "Permitted Subsidiary Indebtedness" means:

         (a) Indebtedness of any Subsidiary of the Company existing on the date
    hereof and listed on Schedule 4.15 and refinancings by such Subsidiary
    thereof; provided that the aggregate principal amount of any such
    refinancing Indebtedness is not greater than the aggregate principal amount
    of the Indebtedness being refinanced plus the amount of any premiums
    required to be paid thereon and fees and expenses associated therewith;

         (b) Indebtedness of any Subsidiary of the Company incurred in the
    ordinary course of business in connection with any Capital Markets Product;

         (c) any Indebtedness owed by Subsidiaries of the Company to the Company
    or any of its Subsidiaries;

         (d) Indebtedness in respect of purchase money obligations and Capital
    Lease Obligations of any Subsidiary of the Company, and refinancings
    thereof; provided that the aggregate principal amount of all such Capital
    Lease Obligations does not exceed at any time outstanding $5,000,000 at the
    time of incurrence of any new Indebtedness under this clause (d);

         (e) Indebtedness of any Subsidiary of the Company in respect of letters
    of credit issued to reinsurance cedents, or to lessors of real property in
    lieu of security deposits in connection with leases of any Subsidiary of the
    Company, in each case in the ordinary course of business;

         (f) Indebtedness of any Subsidiary of the Company incurred in the
    ordinary course of business in connection with workers' compensation claims,
    self-insurance obligations, unemployment insurance or other forms of
    governmental insurance or benefits and pursuant to letters of credit or
    other security arrangements entered into in connection with such insurance
    or benefit;

         (g) additional Indebtedness of Subsidiaries of the Company not
    otherwise permitted under clauses (a) through (f) of this definition which,
    when added to the aggregate amount of all outstanding obligations secured by
    liens incurred by the Company pursuant to Section 7.03(v), shall not exceed
    at any time outstanding 10% of Consolidated Net Worth at the time of
    incurrence of any new Indebtedness under this clause (g); and

         (h) Indebtedness arising from Guarantees made by any Subsidiary of the
    Company of Indebtedness of the type described in clauses (a) through (g) of
    this definition.

                                      -15-

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

         "Plan" means any pension plan as defined in Section 3(2) of ERISA and
subject to Title IV of ERISA, which is maintained or contributed to by (or to
which there is an obligation to contribute of) the Company or any of its
Subsidiaries or any of its ERISA Affiliates, and each such plan for the five
year period immediately following the latest date on which the Company, any of
its Subsidiaries or any of its ERISA Affiliates maintained, contributed to or
had an obligation to contribute to such plan.

         "Policies" means all insurance policies, annuity contracts, guaranteed
interest contracts and funding agreements (including riders to any such policies
or contracts, certificates issued with respect to group life insurance or
annuity contracts and any contracts issued in connection with retirement plans
or arrangements) and assumption certificates issued or to be issued (or filed
pending current review by applicable Governmental Authorities) by any Regulated
Insurance Company and any coinsurance agreements entered into or to be entered
into by any Regulated Insurance Company.

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

         "Private Act" means separate legislation enacted in Bermuda with the
intention that such legislation apply specifically to any Borrower, in whole or
in part.

         "Protected Cell Company" means a Subsidiary that has created segregated
accounts pursuant to the provisions of the Segregated Account Companies Act 2000
of Bermuda.

         "Register" has the meaning set forth in Section 11.04(b).

         "Regulated Insurance Company" means any Subsidiary of the Company,
whether now owned or hereafter acquired, that is authorized or admitted to carry
on or transact Insurance Business in any jurisdiction (foreign or domestic) and
is regulated by any Applicable Insurance Regulatory Authority.

         "Regulation D" means Regulation D of the Board as from time to time in
effect and any successor to all or a portion thereof establishing reserve
requirements.

         "Regulation T" means Regulation T of the Board as from time to time in
effect and any successor to all or a portion thereof establishing margin
requirements.

         "Regulation U" means Regulation U of the Board as from time to time in
effect and any successor to all or a portion thereof establishing margin
requirements.

         "Regulation X" means Regulation X of the Board as from time to time in
effect and any successor to all or a portion thereof establishing margin
requirements.

                                      -16-

         "Reinsurance Agreement" means any agreement, contract, treaty,
certificate or other arrangement whereby any Regulated Insurance Company agrees
to transfer, cede or retrocede to another insurer or reinsurer all or part of
the liability assumed or assets held by such Regulated Insurance Company under a
policy or policies of insurance issued by such Regulated Insurance Company or
under a reinsurance agreement assumed by such Regulated Insurance Company.

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

         "Replaced Lender" has the meaning provided in Section 2.16(b).

         "Replacement Lender" has the meaning provided in Section 2.16(b).

         "Required Lenders" means at any time Non-Defaulting Lenders having at
least a majority of the aggregate Commitments of all Non-Defaulting Lenders;
provided that if the Total Commitment has been terminated, then the Required
Lenders means Lenders whose outstanding Loans participating interest in Letters
of Credit equal or exceed a majority of the Revolving Credit Exposure at such
time.

         "Retrocession Agreement" means any agreement, contract, treaty or other
arrangement whereby one or more insurers or reinsurers, as retrocessionaires,
assume liabilities of reinsurers under a Reinsurance Agreement or other
retrocessionaires under another Retrocession Agreement.

         "Revolving Credit Exposure" means, at any time, the sum of (i) the
aggregate principal amount of all Loans then outstanding and (ii) the aggregate
amount of all Letter of Credit Outstandings at such time.

         "S&P" means Standard & Poor's Ratings Services. ---

         "SAP" means, with respect to any Regulated Insurance Company, the
statutory accounting principles and accounting procedures and practices
prescribed or permitted by the Applicable Insurance Regulatory Authority of the
state or jurisdiction in which such Regulated Insurance Company is domiciled; it
being understood and agreed that determinations in accordance with SAP for
purposes of Article VIII, including defined terms as used therein, are subject
(to the extent provided therein) to Section 1.04.

         "SEC" means the Securities and Exchange Commission or any successor
thereto.

         "Security Agreement" means the Security Agreement substantially in the
form of Exhibit D hereto, as the same may be amended, modified or supplemented
from time to time in accordance with the provisions thereof.

         "Security Documents" means (i) the Security Agreement, (ii) the Account
Control Agreement, (iii) each other security agreement executed and delivered
pursuant to Section 6.12 of this Agreement and (iv) each other document,
agreement, certificate and or financing

                                      -17-

statement, executed, delivered, made or filed pursuant to the terms of the
documents specified in foregoing clauses (i) , (ii) and (iii).

         "Service of Process Agent" means CT Corporation System.

         "Several Letter of Credit" has the meaning provided in Section 3.01(a).

         "Several Unpaid Drawing" has the meaning provided in clause (x) of
Section 3.05(a).

         "Solvent" means, with respect to any Person on a particular date, that
on such date (a) the amount of the "present fair saleable value" of each of the
business and assets of such Person will, as of such date, exceed the amount of
all "liabilities of such Person, contingent or otherwise", as of such date, as
such quoted terms are determined in accordance with applicable federal and state
laws governing determinations of the insolvency of debtors, (b) the present fair
salable value of each of the business and assets of such Person is greater than
the amount that will be required to be paid on or in respect of the probable
"liability" on the existing debts and other "liabilities contingent or
otherwise" of such Person, (c) the assets of such Person do not constitute
unreasonably small capital for such Person to carry out its business as now
conducted and as proposed to be conducted including the capital needs of such
Person, taking into account the particular capital requirements of the business
conducted by such Person and projected capital requirements and capital
availability thereof, (d) such Person does not intend to incur debts beyond
their ability to pay such debts as they mature (taking into account the timing
and amounts of cash to be received by such Person, and of amounts to be payable
on or in respect of debt of such Person) and (e) such Person does not believe
that final judgments against such Person in actions for money damages presently
pending will be rendered at a time when, or in an amount such that, they will be
unable to satisfy any such judgments promptly in accordance with their terms
(taking into account the maximum reasonable amount of such judgments in any such
actions and the earliest reasonable time at which such judgments might be
rendered) and such Person believes that its cash flow, after taking into account
all other anticipated uses of the cash of such Person (including, without
limitation, the payments on or in respect of debt referred to in paragraph (d)
of this definition), will at all times be sufficient to pay all such judgments
promptly in accordance with their terms. For purposes of this definition, (i)
"debt" means liability on a "claim", and (ii) "claim" means any (A) right to
payment, whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured or (B) right to an equitable remedy for
breach of performance if such breach gives rise to a right to payment, whether
or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured or unmatured, disputed, undisputed, secured or unsecured.

         "Specified Obligor" means each of the Company and each other Borrower
that is not a U.S. Regulated Insurance Company.

         "Stated Amount" means at, any time, the maximum amount available to be
drawn under any Letter of Credit (regardless of whether any conditions for
drawing could then be met).

         "Statutory Reserve Rate" means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggre-

                                      -18-

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

         "Statutory Statements" means, with respect to any Regulated Insurance
Company for any fiscal year, the annual or quarterly financial statements of
such Regulated Insurance Company as required to be filed with the Insurance
Regulatory Authority of its jurisdiction of domicile and in accordance with the
laws of such jurisdiction, together with all exhibits, schedules, certificates
and actuarial opinions required to be filed or delivered therewith.

         "Statutory Surplus" means, in respect of any Regulated Insurance
Company, the statutory surplus of such Regulated Insurance Company determined in
accordance with the SAP applicable to such Regulated Insurance Company.

         "Subsidiary" means any subsidiary of the Company.

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

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

         "Total Commitment" means, at any time, the sum of the Commitments of
each of the Lenders at such time.

         "Transaction" means the execution, delivery and performance by each
Borrower of this Agreement, the borrowing of Loans by the Company and the use of
the proceeds thereof and the issuance of Letters of Credit for the account of
any Borrower and the granting of Liens pursuant to the Security Documents, in
each case, on and after the Effective Date.

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

                                      -19-

         "Uniform Commercial Code" has the meaning provided in the Security
Agreement.

         "Unpaid Drawings" means the Several Unpaid Drawings and the Fronted
Unpaid Drawings.

         "U.S. Regulated Insurance Company" means any Person that is a Regulated
Insurance Company regulated by an Applicable Insurance Regulatory Authority of
any State of the United States of America.

         "Wholly-Owned Subsidiary" of any Person means any Subsidiary of such
Person to the extent all of the capital stock or other ownership interests in
such Subsidiary, other than directors' or nominees' qualifying shares, is owned
directly or indirectly by such Person.

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

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

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

                                      -20-

become effective until such notice shall have been withdrawn or such provision
amended in accordance with Section 11.02.

                                   ARTICLE II

                                   The Credits

         Section 2.01. Commitments. Subject to and upon the terms and conditions
herein set forth, each Lender severally agrees, at any time and from time to
time on and after the Effective Date and prior to the Commitment Expiration
Date, to make a loan or loans (each, a "Loan" and, collectively, the "Loans") to
the Company, which Loans (i) may be made and maintained only in Dollars; (ii)
may be repaid and reborrowed in accordance with the provisions hereof; (iii)
except as hereinafter provided, may, at the option of the Company, be incurred
and maintained as, and/or converted into, ABR Loans or Eurodollar Loans,
provided that all Loans made as part of the same Borrowing shall, unless
otherwise specified herein, consist of Loans of the same Type; and (iv) (x)
shall not be made (and shall not be required to be made) by any Lender if the
making of same would cause the Revolving Credit Exposure (after giving effect to
the use of the proceeds thereof on the date of the incurrence thereof to repay
any amounts theretofore outstanding pursuant to this Agreement) to exceed the
Total Commitment as then in effect, (y) shall not be made (and shall not be
required to be made) by any Lender if the making of same would cause the
Revolving Credit Exposure attributable to the Company (after giving effect to
the use of the proceeds thereof on the date of the incurrence thereof to repay
amounts theretofore outstanding pursuant to this Agreement) to exceed the
Company's Borrowing Base at such time and (z) shall not be made (and shall not
be required to be made) by any Lender if the making of same would cause the
aggregate principal amount of all Loans then outstanding (after giving effect to
the use of the proceeds thereof on the date of the incurrence thereof to repay
amounts theretofore outstanding pursuant to this Agreement) to exceed
$25,000,000.

         Section 2.02. Loans and Borrowings. (a) Each Loan shall be made as part
of a Borrowing consisting of Loans made by the Lenders ratably in accordance
with their respective Commitments. The failure of any Lender to make any Loan
required to be made by it shall not relieve any other Lender of its obligations
hereunder.

         (b) Subject to Section 2.11, each Borrowing shall be comprised entirely
of ABR Loans or Eurodollar Loans as the Company may request in accordance
herewith. Each Lender at its option may make any Eurodollar Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan;
provided that any exercise of such option shall not affect the obligation of the
Company to repay such Loan in accordance with the terms of this Agreement.

         (c) At the commencement of each Interest Period for any Eurodollar
Borrowing, such Borrowing shall be in an aggregate principal amount of not less
than $5,000,000. At the time that each ABR Borrowing is made, such Borrowing
shall be in an aggregate amount that is an integral multiple of $1,000,000 and
not less than $5,000,000; provided that a Borrowing may be in an aggregate
amount that is equal to the entire unused balance of the Total Commitment.
Borrowings of more than one Type may be outstanding at the

                                      -21-

same time; provided that there shall not at any time be more than a total of ten
Eurodollar Borrowings outstanding.

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

         Section 2.03. Requests for Borrowings. To request a Borrowing, the
Company shall notify the Administrative Agent of such request by telephone (a)
in the case of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of the proposed Borrowing and (b) in
the case of an ABR Borrowing, not later than 11:00 a.m., New York City time, on
the date of the proposed Borrowing. Each such telephonic Borrowing Request shall
be irrevocable and shall be confirmed promptly by hand delivery or facsimile to
the Administrative Agent of a written Borrowing Request in the form of Exhibit E
appropriately completed and signed by the Company. Each such telephonic and
written Borrowing Request shall specify the following information in compliance
with Section 2.02:

         (i) the aggregate principal amount of the requested Borrowing;

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

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

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

         (v) the location and number of the Company's account to which funds are
    to be disbursed.

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

         Section 2.04. Funding of Borrowings. (a) Each Lender shall make each
Loan on the proposed date thereof by wire transfer of immediately available
funds by 1:00 p.m., New York City time, to the account of the Administrative
Agent most recently designated by it for such purpose by notice to the Lenders.
The Administrative Agent will make such Loans available to the Company by wire
transfer of immediately available funds not later than 2:00 p.m. New York City
time to the account of the Company designated by it in the applicable Borrowing
Request.

         (b) Unless the Administrative Agent shall have received notice from a
Lender prior to the proposed date of any Borrowing that such Lender will not
make available to the

                                      -22-

Administrative Agent such Lender's share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance upon such
assumption, make available to the Company a corresponding amount. In such event,
if a Lender has not in fact made its share of the applicable Borrowing available
to the Administrative Agent, then the applicable Lender and the Company
severally agree to pay to the Administrative Agent forthwith on demand such
corresponding amount with interest thereon, for each day from and including the
date such amount is made available to the Company to but excluding the date of
payment to the Administrative Agent, at (i) in the case of such Lender, the
greater of the Federal Funds Effective Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation or (ii) in the case of the Company, the interest rate applicable to
ABR Loans. If such Lender pays such amount to the Administrative Agent, then
such amount shall constitute such Lender's Loan included in such Borrowing.

         Section 2.05. Interest Elections. (a) Each Borrowing initially shall be
of the Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Borrowing, shall have an initial Interest Period as specified in such
Borrowing Request. Thereafter, the Company may elect to convert such Borrowing
to a different Type or to continue such Borrowing and, in the case of a
Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in
this Section 2.05. Subject to the other provisions of this Section 2.05, the
Company may elect different options with respect to different portions of the
affected Borrowing, in which case each such portion shall be allocated ratably
among the Lenders holding the Loans comprising such Borrowing, and the Loans
comprising each such portion shall be considered a separate Borrowing.

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

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

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

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

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

                                      -23-

         (iv) the amount of the Company's Borrowing Base at such time; and

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

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

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

         (e) If the Company fails to deliver a timely Interest Election Request
with respect to a Eurodollar Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at
the end of such Interest Period such Borrowing shall be converted to an ABR
Borrowing. Notwithstanding anything to the contrary contained in this Agreement,
if a Default or an Event of Default is in existence, then, so long as a Default
or an Event of Default is in existence (i) no outstanding Borrowing may be
converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each
Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.

         Section 2.06. Termination and Reduction of Commitments. (a) Unless
previously terminated, the Total Commitment (and the Commitment of each Lender)
shall terminate on the Commitment Expiration Date.

         (b) The Company may at any time terminate, or from time to time reduce,
the Total Commitment; provided that (i) each reduction of the Total Commitment
shall be in an amount that is an integral multiple of $1,000,000 and not less
than $5,000,000 and (ii) the Company shall not terminate or reduce the Total
Commitment if, after giving effect to any concurrent prepayment of the Loans in
accordance with Section 2.08, the Revolving Credit Exposures would exceed the
Total Commitment. Each such reduction shall be applied to the Commitments of the
Lenders on a pro rata basis based on the amount of such Lenders' respective
Commitments.

         (c) The Company shall notify the Administrative Agent of any election
to terminate or reduce the Total Commitment under paragraph (b) of this Section
2.06 at least three Business Days prior to the effective date of such
termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Company pursuant to this Section shall be irrevocable. Any termination or
reduction of the Total Commitment (or the Commitments of any Lender) shall be
permanent. Each reduction of the Total Commitment shall be made ratably among
the Lenders in accordance with their respective Commitments.

                                      -24-

         Section 2.07. Repayment of Loans; Evidence of Debt. (a) The Company
hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender the then unpaid principal amount of all Loans on the
Commitment Expiration Date.

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

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

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

         (e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Company shall prepare, execute and deliver
to such Lender a promissory note payable to the order of such Lender (or, if
requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent and the Company. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 11.04) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).

         Section 2.08. Prepayment of Loans; Additional Borrowing Base
Requirements. (a) The Company shall have the right at any time and from time to
time to prepay any Borrowing in whole or in part, without premium or penalty,
except as provided in Section 2.13, subject to prior notice in accordance with
paragraph (b) of this Section.

         (b) The Company shall notify the Administrative Agent by telephone
(confirmed by facsimile) of any prepayment hereunder (i) in the case of
prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City
time, three Business Days before the date of prepayment or (ii) in the case of
prepayment of an ABR Borrowing, not later than 11:00 a.m., New York City time,
one Business Day before the date of prepayment. Each such notice shall be
irrevocable and shall specify the prepayment date, the Borrowing or Borrowings
which are to be prepaid and the currency in which such Borrowing or Borrowings
are denominated and the principal amount of each Borrowing or portion thereof to
be prepaid. Promptly following receipt of any such notice relating to a
Borrowing, the Administrative Agent shall advise the Lenders of the contents
thereof. Each partial prepayment of any Borrowing shall be in an amount that
would be permitted in the case of an advance of a Borrowing of the same Type as
provided in Section 2.02. Each prepayment of a Borrowing shall be applied
ratably to the Loans included in

                                      -25-

the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to
the extent required by Section 2.10.

         (c) If on any date the Revolving Credit Exposure exceeds the Total
Commitment as then in effect, the Company shall prepay on such date the
principal amount of outstanding Loans equal to such excess. If, after giving
effect to the prepayment of all outstanding Loans, the aggregate amount of all
Letter of Credit Outstandings exceeds the Total Commitment as then in effect,
the Company shall, or shall cause one or more other Borrowers to, pay or deliver
to the Administrative Agent on such date an amount of cash or Cash Equivalents
equal to the amount of such excess, such cash or Cash Equivalents to be held as
additional security for all obligations of the respective Borrower hereunder in
the Collateral Account applicable to such Borrower.

         (d) If on any date, after giving effect to any prepayment of
outstanding Loans pursuant to paragraph (c) above, the Revolving Credit Exposure
attributable to any Borrower exceeds the Borrowing Base of such Borrower at such
time, such Borrower agrees to (i) in the case of the Company, within two
Business Days of the date on which the Company receives notice from the
Administrative Agent that the Revolving Credit Exposure attributable to the
Company exceeds the Company's Borrowing Base, prepay the principal amount of
outstanding Loans and/or pay or deliver to the Collateral Agent an amount of
cash or Eligible Securities (valued for this purpose based on the respective
Advance Rate applicable thereto) in an aggregate amount equal to such excess,
with any such cash or Eligible Securities to be held as additional security for
all obligations of the Company hereunder in the Collateral Account applicable to
the Company and (ii) in the case of any other Borrower, within two Business Days
of the date on which the Company or such Borrower receives notice from the
Administrative Agent that the Revolving Credit Exposure attributable to such
Borrower exceeds such Borrower's Borrowing Base, pay or deliver to the
Collateral Agent an amount of cash or Eligible Securities (valued for this
purpose based on the respective Advance Rate applicable thereto) in an aggregate
amount equal to such excess, with any such cash or Eligible Securities to be
held as additional security for all obligations of such Borrower hereunder in
the Collateral Account applicable to such Borrower.

         Section 2.09. Fees. (a) Each Specified Obligor jointly and severally
agrees to pay to the Administrative Agent for the account of each Lender a
commitment fee, which shall accrue at the Applicable Commitment Fee Rate on the
daily amount of the unutilized Commitment of such Lender during the period from
and including the Effective Date to but excluding the Commitment Expiration
Date. Accrued commitment fees shall be payable in arrears on the last day of
March, June, September and December of each year and on the Commitment
Expiration Date, commencing on the first such date to occur after the date
hereof. All commitment fees shall be computed on the basis of a year of 360 days
and shall be payable for the actual number of days elapsed (including the first
day but excluding the last day).

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

         (c) Each Borrower severally agrees to pay to the Administrative Agent
for pro rata distribution to each Lender (based on their respective Applicable
Percentages), a fee in

                                      -26-

respect of each Letter of Credit issued for the account of such Borrower (the
"Letter of Credit Fee") computed at a rate per annum equal to 0.35% on the daily
Stated Amount of such Letter of Credit. Accrued Letter of Credit Fees shall be
due and payable in arrears on the last day of March, June, September and
December of each year and upon the first day on or after the termination of the
Total Commitment upon which no Letters of Credit remain outstanding.

         (d) Each Borrower severally agrees to pay to each Fronting Lender, for
its own account, a fronting fee in respect of each Fronted Letter of Credit
issued by such Fronting Lender for the account of such Borrower in an amount and
on dates as shall have separately been agreed to by the Company and such
Fronting Lender.

         (e) All fees payable hereunder shall be paid on the dates due, in
immediately available funds, to the Administrative Agent for distribution to the
Persons entitled thereto as set forth above. Fees paid shall not be refundable
under any circumstances.

         Section 2.10. Interest. (a) The Loans comprising each ABR Borrowing
shall bear interest at the Alternate Base Rate.

         (b) The Loans comprising each Eurodollar Borrowing shall bear interest
at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing
plus 0.35%.

         (c) Notwithstanding the foregoing, if any principal of or interest on
any Loan or any fee or other amount payable by any Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such
overdue amount shall bear interest, after as well as before judgment, at a rate
per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the
rate otherwise applicable to such Loan as provided in the preceding paragraphs
of this Section 2.10 or (ii) in the case of any other amount, 2% plus the rate
applicable to ABR Loans as provided in paragraph (a) of this Section 2.10.

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

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

         Section 2.11. Alternate Rate of Interest. If prior to the commencement
of any Interest Period for a Eurodollar Borrowing:

                                      -27-

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

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

then the Administrative Agent shall give notice thereof to the Company and the
Lenders by telephone or facsimile as promptly as practicable thereafter and,
until the Administrative Agent notifies the Company and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) in the case of
clauses (a) and (b) above any Interest Election Request that requests the
conversion of any Borrowing to, or continuation of any Borrowing as, a
Eurodollar Borrowing shall be ineffective and (ii) if any Borrowing Request
requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing provided that if the circumstances giving rise to such notice affect
only one Type of Borrowings, then the other Type of Borrowings shall be
permitted.

         Section 2.12. Increased Costs. (a) If any Change in Law shall:

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

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

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

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

         (c) A certificate of a Lender setting forth (i) the amount or amounts
necessary to compensate such Lender or its holding company, as the case may be,
as specified in

                                      -28-

paragraph (a) or (b) of this Section and (ii) the basis, in reasonable detail,
for the computation of such amount or amounts, which shall be consistently
applied shall be delivered to the Company and shall be conclusive absent
manifest error. The Company shall pay such Lender the amount shown as due on any
such certificate within 10 days after receipt thereof.

         (d) Failure or delay on the part of any Lender to demand compensation
pursuant to this Section shall not constitute a waiver of such Lender's right to
demand such compensation; provided that the Company shall not be required to
compensate a Lender pursuant to this Section for any increased costs or
reductions incurred more than 90 days prior to the date that such Lender
notifies the Company of the Change in Law giving rise to such increased costs or
reductions and of such Lender's intention to claim compensation therefor;
provided, further, that, if the Change in Law giving rise to such increased
costs or reductions is retroactive, then the 90-day period referred to above
shall be extended to include the period of retroactive effect thereof.

         Section 2.13. Break Funding Payments. In the event of (a) the payment
of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of a mandatory
prepayment under Section 2.08 or the occurrence of an Event of Default), (b) the
conversion of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or
prepay any Eurodollar Loan on the date specified in any notice delivered
pursuant hereto, or (d) the assignment of any Eurodollar Loan other than on the
last day of the Interest Period applicable thereto as a result of a request by
the Company pursuant to Section 2.16, then, in any such event, the Company shall
compensate each Lender for the loss, cost and expense attributable to such
event. In the case of a Eurodollar Loan, such loss, cost or expense to any
Lender shall be deemed to include an amount determined by such Lender to be the
excess, if any, of (i) the amount of interest which would have accrued on the
principal amount of such Loan had such event not occurred, at the Adjusted LIBO
Rate that would have been applicable to such Loan, for the period from the date
of such event to the last day of the then current Interest Period therefor (or,
in the case of a failure to borrow, convert or continue, for the period that
would have been the Interest Period for such Loan), over (ii) the amount of
interest which would accrue on such principal amount for such period at the
interest rate which such Lender would bid were it to bid, at the commencement of
such period, for dollar deposits of a comparable amount and period from other
banks in the eurodollar market. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Company and shall be conclusive absent
manifest error. The Company shall pay such Lender the amount shown as due on any
such certificate within 10 days after receipt thereof.

                                      -29-

         Section 2.14. Taxes. (a) Any and all payments by or on account of any
obligation of any Borrower hereunder shall be made free and clear of and without
deduction for any Indemnified Taxes or Other Taxes; provided that if such
Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from
such payments, then (i) the sum payable shall be increased as necessary so that
after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent or Lender
(as the case may be) receives an amount equal to the sum it would have received
had no such deductions been made, (ii) such Borrower shall make such deductions
and (iii) such Borrower shall pay the full amount deducted to the relevant
Governmental Authority in accordance with applicable law.

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

         (c) Each Borrower severally (and not jointly) agrees to indemnify the
Administrative Agent and each Lender within 10 days after written demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes that such
Borrower failed to deduct or withhold and that were paid by the Administrative
Agent or such Lender on or with respect to any payment by or on account of any
obligation of such Borrower hereunder (including Indemnified Taxes or Other
Taxes imposed or asserted on or attributable to amounts payable under this
Section) and any penalties, interest and reasonable expenses arising therefrom
or with respect thereto, whether or not such Indemnified Taxes or Other Taxes
were correctly or legally imposed or asserted by the relevant Governmental
Authority. A certificate as to the amount of such payment or liability (with
reasonable detail) delivered to any Borrower by a Lender or by the
Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.

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

         (e) Each Foreign Lender shall deliver to the Company (with a copy to
the Administrative Agent), at the time or times prescribed by applicable law,
such properly completed and executed documentation prescribed by applicable law
or reasonably requested by the Company (if any), or will comply with such other
requirements, if any, as is currently applicable, as will permit payments under
this Agreement to be made without withholding or at a reduced rate; provided,
however, that the Company shall have furnished to each such Lender in a
reasonably timely manner copies of such documentation and notice of such
requirements together with applicable instructions; provided, further, that no
such Lender shall have any obligation to provide such documentation or comply
with such requirements if it would result in a material economic, legal or
regulatory disadvantage to any such Lender.

         (f) If the Administrative Agent or a Lender determines, in its sole
discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by any Borrower or with respect to which such
Borrower has paid additional amounts pursuant to this Section 2.14, it shall pay
over such refund to such Borrower (but only to the extent of

                                      -30-

indemnity payments made, or additional amounts paid, by such Borrower under this
Section 2.14 with respect to the Taxes or Other Taxes giving rise to such
refund), net of all out-of-pocket expenses of the Administrative Agent or such
Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided, that such
Borrower, upon the request of the Administrative Agent or such Lender, agrees to
repay the amount paid over to such Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
This Section shall not be construed to require the Administrative Agent or any
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to such Borrower or any other Person.

         (g) Any Lender that is not a Lender as of the Effective Date shall not
be entitled to any greater payment under this Section 2.14 than such Lender's
assignor could have been entitled to absent such assignment except to the extent
that the entitlement to a greater payment resulted from a Change in Law.

         Section 2.15. Payments Generally; Pro Rata Treatment; Sharing of
Set-offs. (a) Each Borrower shall make each payment required to be made by it
hereunder (whether of principal, interest, fees or of amounts payable under
Section 2.12, 2.13 or 2.14, or otherwise) prior to 12:00 noon, New York City
time, on the date when due, in immediately available funds, without set-off or
counterclaim in Dollars. Any amounts received after such time on any date may,
in the discretion of the Administrative Agent, be deemed to have been received
on the next succeeding Business Day for purposes of calculating interest
thereon. All such payments shall be made to the Administrative Agent at its
offices at 270 Park Avenue, New York, New York 10017, except that payments
pursuant to Sections 2.12, 2.13, 2.14 and 11.03 shall be made directly to the
Persons entitled thereto. The Administrative Agent shall distribute any such
payments received by it for the account of any other Person to the appropriate
recipient promptly following receipt thereof. If any payment hereunder shall be
due on a day that is not a Business Day, the date for payment shall be extended
to the next succeeding Business Day, and, in the case of any payment accruing
interest, interest thereon shall be payable for the period of such extension.

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

         (c) If any Lender shall, by exercising any right of set-off or
counterclaim or otherwise, obtain payment in respect of any principal of or
interest on any of its Loans, Unpaid Drawings or any fees payable pursuant to
Section 2.09 resulting in such Lender receiving payment of a greater proportion
of the aggregate amount of such obligations then due and owed to such Lender,
then the Lender receiving such greater proportion shall purchase (for cash at
face value) participations in such obligations of the respective Borrower or the
Company, as the case

                                      -31-

may be, owed to such Lenders to the extent necessary so that the benefit of all
such payments shall be shared by the Lenders ratably; provided that (i) if any
such participations are purchased and all or any portion of the payment giving
rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by any Borrower pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans to any assignee
or participant, other than to any Borrower or any Subsidiary or Affiliate
thereof (as to which the provisions of this paragraph shall apply). Each
Borrower consents to the foregoing and agrees, to the extent it may effectively
do so under applicable law, that any Lender acquiring a participation pursuant
to the foregoing arrangements may exercise against such Borrower rights of
set-off and counterclaim with respect to such participation as fully as if such
Lender were a direct creditor of such Borrower in the amount of such
participation.

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

         (e) If any Lender shall fail to make any payment required to be made by
it pursuant to Section 2.04(b) or 2.15(d), then the Administrative Agent may, in
its discretion (notwithstanding any contrary provision hereof), apply any
amounts thereafter received by the Administrative Agent for the account of such
Lender to satisfy such Lender's obligations under such Sections until all such
unsatisfied obligations are fully paid.

         Section 2.16. Mitigation Obligations; Replacement of Lenders. (a) If
any Lender requests compensation under Section 2.12 or Section 3.06, or if each
Borrower is required to pay any additional amount to any Lender or any
Governmental Authority for the account of any Lender pursuant to Section 2.14 or
Section 3.06, then such Lender shall use reasonable efforts to designate a
different lending office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender, such designation or assignment
(i) would eliminate or reduce amounts payable pursuant to Section 2.12 or 2.14
or 3.06, as the case may be, in the future and (ii) would not subject such
Lender to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender. Each Specified Obligor hereby jointly and
severally agrees to pay all reasonable costs and expenses incurred by any Lender
in connection with any such designation or assignment.

                                      -32-

         (b) If any Lender (x) requests compensation under Section 2.12 or
Section 3.06, or if each Borrower is required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.14 or Section 3.06, (y) becomes a Defaulting Lender or (z) becomes
a Non-Continuing Lender, then, in each case, the Company, at its sole expense
and effort, shall have the right, if no Default or Event of Default then exists,
to replace such Lender (the "Replaced Lender"), with one or more Person or
Persons, none of whom shall be a Defaulting Lender at the time of such
replacement (collectively, the "Replacement Lender") reasonably acceptable to
the Administrative Agent at which time the Replaced Lender shall assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in Section 11.04), all its interests, rights and obligations under
this Agreement to the Replacement Lender; provided that (i) at the time of any
replacement pursuant to this Section 2.16, the Replacement Lender and the
Replaced Lender shall enter into one or more Assignment and Assumptions pursuant
to Section 11.04(b) (and with all fees payable pursuant to said Section 11.04(b)
to be paid by the Replacement Lender) pursuant to which the Replacement Lender
shall acquire all of the Commitments and outstanding Loans of the Replaced
Lender and, in connection therewith, shall pay to the Replaced Lender in respect
thereof an amount equal to the sum of (A) an amount equal to the principal
amount of, and all accrued but unpaid interest on, all outstanding Loans of the
Replaced Lender, (B) an amount equal to all Unpaid Drawings that have been
funded by (and not reimbursed to) such Replaced Lender, together with all then
unpaid interest with respect thereto at such time and (C) an amount equal to all
accrued, but theretofore unpaid, fees owing to the Replaced Lender pursuant to
Section 2.09; (ii) all obligations of each Borrower under the Credit Documents
owing to the Replaced Lender (other than those specifically described in clause
(i) above in respect of which the assignment purchase price has been, or is
concurrently being, paid), including without limitation all amounts owing to the
Replaced Lender under Section 2.13 as a result of the assignment of its Loans
under clause (i) above, shall be paid in full to such Replaced Lender
concurrently with such replacement; (iii) no assignment pursuant to this Section
2.16 shall be effective until all of the then outstanding Several Letters of
Credit are returned by each respective beneficiary to the Issuing Agent for
cancellation in exchange for new or amended Several Letters of Credit which give
effect to such assignment (it being understood that to the extent the respective
beneficiaries do not consent to such assignment, such assignment cannot occur);
(iv) the Company shall have received the prior written consent of the
Administrative Agent and each Fronting Lender, which consents shall not be
unreasonably withheld; (v) in the case of any such assignment resulting from a
claim for compensation under Section 2.12 or payments required to be made
pursuant to Section 2.14, such assignment will result in a reduction in such
compensation or payments; and (vi) no Lender shall be required to become a
Replaced Lender if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Company to require such assignment
and delegation cease to apply. Upon the execution of the respective Assignment
and Assumption, the payment of amounts referred to in clauses (i) and (ii) above
and the return, cancellation and exchange of each then outstanding Several
Letter of Credit as provided above and, if so requested by the Replacement
Lender, delivery to the Replacement Lender of the appropriate note or notes
executed by the Company, the Replacement Lender shall become a Lender hereunder
and the Replaced Lender shall cease to constitute a Lender hereunder, except
with respect to indemnification provisions applicable to the Replaced Lender
under this Agreement, which shall survive as to such Replaced Lender.

                                      -33-

         Section 2.17. Designated Subsidiary Borrowers. The Company may from
time to time designate one or more Persons as an additional Designated
Subsidiary Borrower, subject to the following terms and conditions:

         (a) each such Person shall be a Wholly Owned Subsidiary of the Company;

         (b) each such Designated Subsidiary Borrower shall enter into an
appropriately completed DSB Assumption Agreement in the form of Exhibit C hereto
on or prior to the date of designation hereof;.

         (c) on or prior to the date of designation, the Administrative Agent
shall have received from such Person a certificate, signed by an Authorized
Officer of such Person in the form of Exhibit F with appropriate insertions or
deletions, together with (x) copies of its certificate of incorporation, by-laws
or other organizational documents and (y) the resolutions of the board of
directors (or similar governing body) of such Person relating to the Credit
Documents which shall be reasonably satisfactory to the Administrative Agent;

         (d) on or prior to the date of designation, the Administrative Agent
shall have received an opinion, addressed to the Administrative Agent and each
of the Lenders and dated the date of designation, from counsel to such Person
which opinion shall be substantially in the form of Exhibit H hereto; and

         (e) no Designated Subsidiary Borrower may incur, or be liable for (by
assignment or otherwise), any Loan hereunder.

         Section 2.18. Extension of Commitment Expiration Date. (a) The Company
may, by notice to the Administrative Agent (which shall promptly notify the
Lenders) not more than 60 days and not less than 30 days prior to the Commitment
Expiration Date then in effect (the "Existing Commitment Expiration Date"),
request that each Lender agree to an extension of the Commitment Expiration Date
for an additional 364 days from the Existing Commitment Expiration Date. Such
request shall be accompanied by a certificate of an Authorized Officer of the
Company stating that no Default or Event of Default has occurred and is
continuing.

         (b) Each Lender, acting in its sole and individual discretion, shall,
by notice to the Administrative Agent given not more than 30 days prior to the
Existing Commitment Expiration Date but in any event no later than the date (the
"Notice Date") 20 days prior to the Existing Commitment Expiration Date, elect
to either extend the Commitment Expiration Date as provided in Section 2.18(a)
or decline to agree to such extension (any Lender declining to agree to any such
extension, a "Non-Continuing Lender"). Any Lender that does not so advise the
Administrative Agent on or before the Notice Date shall be deemed to be a
Non-Continuing Lender. The election of any Lender to agree to any such extension
shall not obligate any other Lender to so agree.

         (c) The Administrative Agent shall notify the Company in writing of
each Lender's determination under this Section 2.18 no later than the date 15
days prior to the Existing Commitment Expiration Date (or, if such date is not a
Business Day, on the next preceding Business Day).

                                      -34-

         (d) The Company shall have the right on or before the Existing
Commitment Expiration Date to replace each Non-Continuing Lender with, and add
as "Lenders" under this Agreement in place thereof, one or more Replacement
Lenders in accordance with Section 2.16(b).

         (e) If (and only if) the aggregate Commitments of all Lenders that have
agreed so to extend the Commitment Expiration Date (including the additional
Commitment of any Lender) and the additional Commitments of the Replacement
Lenders shall be equal to 100% of the Total Commitment in effect immediately
prior to the Existing Commitment Expiration Date, then, effective as of the
Existing Commitment Expiration Date, the Commitment Expiration Date shall be
extended to the date falling 364 days after the Existing Commitment Expiration
Date (except that, if such date is not a Business Day, such Commitment
Termination Date as so extended shall be the next preceding Business Day) and
each Replacement Lender shall thereupon become a "Lender" for all purposes of
this Agreement.

         (f) Notwithstanding the foregoing, each extension of the Commitment
Expiration Date pursuant to this Section 2.18 shall be effective only if the
Company shall have paid in full all amounts owing to each Non-Continuing Lender
hereunder and such Non-Continuing Lender shall have been released of its
obligations in respect of Letters of Credit issued hereunder, in each case, on
or before the Existing Commitment Expiration Date.

                                   ARTICLE III

                                Letters of Credit

         Section 3.01. Several Letters of Credit. (a) Subject to and upon the
terms and conditions set forth herein, each Borrower may request the Issuing
Agent at any time and from time to time on or after the Effective Date and prior
to the Commitment Expiration Date to issue, for the account of such Borrower and
in support of, on a standby basis, Letter of Credit Supportable Obligations of
such Borrower to any other Person and subject to and upon the terms and
conditions herein set forth the Issuing Agent agrees to issue at any time and
from time to time on or after the Effective Date and prior to the Commitment
Expiration Date one or more irrevocable standby letters of credit in such form
as may be approved by the Issuing Agent which approval shall not be unreasonably
withheld (each such letter of credit, a "Several Letter of Credit" and,
collectively, the "Several Letters of Credit").

         (b) Each Several Letter of Credit will be issued by the Issuing Agent
on behalf of the Lenders and each Lender will participate in each Several Letter
of Credit pro rata in accordance with its Applicable Percentage. The obligations
of each Lender under and in respect of each Several Letter of Credit are
several, and the failure by any Lender to perform its obligations hereunder or
under any Letter of Credit shall not affect the obligations of the respective
Borrower toward any other party hereto nor shall any other such party be liable
for the failure by such Lender to perform its obligations hereunder or under any
Several Letter of Credit.

         (c) Each Several Letter of Credit shall be executed and delivered by
the Issuing Agent in the name and on behalf of, and as attorney-in-fact for,
each Lender and the Issuing Agent shall act under each Several Letter of Credit,
and each Several Letter of Credit

                                      -35-

shall expressly provide that the Issuing Agent shall act, as the agent of each
Lender to (a) receive drafts, other demands for payment and other documents
presented by the beneficiary under such Several Letter of Credit, (b) determine
whether such drafts, demands and documents are in compliance with the terms and
conditions of such Letter of Credit and (c) notify such Lender and such Borrower
that a valid drawing has been made and the date that the related Several Unpaid
Drawing is to be made; provided that the Issuing Agent shall have no obligation
or liability for any Several Unpaid Drawing under such Letter of Credit, and
each Several Letter of Credit shall expressly so provide. Each Lender hereby
irrevocably appoints and designates the Issuing Agent as its attorney-in-fact,
acting through any duly authorized officer of JPMorgan Chase Bank, to execute
and deliver in the name and on behalf of such Lender each Several Letter of
Credit to be issued by such Lender hereunder. Promptly upon the request of the
Issuing Agent, each Lender will furnish to the Issuing Agent such powers of
attorney or other evidence as any beneficiary of any Several Letter of Credit
may reasonably request in order to demonstrate that the Issuing Agent has the
power to act as attorney-in-fact for such Lender to execute and deliver such
Several Letter of Credit.

         (d) Each Lender represents and warrants that each Several Letter of
Credit constitutes a legal, valid and binding obligation of such Lender
enforceable in accordance with its terms, provided that the enforceability
thereof is subject to general principles of equity and to bankruptcy, insolvency
and similar laws affecting the enforcement of creditors' rights generally.

         Section 3.02. Fronted Letters of Credit. (a) Subject to and upon the
terms and conditions set forth herein, each Borrower may request that any
Fronting Lender at any time and from time to time on or after the Effective Date
and prior to the Commitment Expiration Date issue for its own account a letter
of credit for the account of such Borrower and in support of, on a standby
basis, Letter of Credit Supportable Obligations of such Borrower to any other
Person and subject to and upon the terms and conditions herein set forth each
Fronting Lender agrees to issue at any time and from time to time on or after
the Effective Date and prior to the Commitment Expiration Date one or more
irrevocable standby letters of credit in such form as may be approved by such
Fronting Lender, which approval shall not be unreasonably withheld (each such
letter of credit, a "Fronted Letter of Credit" and, collectively, the "Fronted
Letters of Credit").

         (b) Immediately upon the issuance by any Fronting Lender of any Fronted
Letter of Credit, such Fronting Lender shall be deemed to have sold and
transferred to each Lender other than such Fronting Lender (each such Lender, in
its capacity under this Section 3.02(b), a "Fronting Participant"), and each
such Fronting Participant shall be deemed irrevocably and unconditionally to
have purchased and received from such Fronting Lender, without recourse or
warranty, an undivided interest and participation, to the extent of such
Fronting Participant's Applicable Percentage, in such Fronted Letter of Credit,
each drawing made thereunder and the obligations of each Borrower under this
Agreement with respect thereto, and any security therefor or guaranty pertaining
thereto. Upon any change in the Commitments or Applicable Percentages of the
Lenders pursuant to this Agreement, it is hereby agreed that, with respect to
all outstanding Fronted Letters of Credit and Fronted Unpaid Drawings, there
shall be an automatic adjustment to the participations pursuant to this Section

                                      -36-

3.02 to reflect the new Applicable Percentages of the assignor and assignee
Lender or of all Lenders with Commitments, as the case may be.

         (c) In the event that any Fronting Lender makes any payment under any
Fronted Letter of Credit and the respective Borrower shall not have reimbursed
such amount in full to such Fronting Lender pursuant to Section 3.05, such
Fronting Lender shall promptly notify the Administrative Agent, which shall
promptly notify each Fronting Participant, of such failure, and each Fronting
Participant shall promptly and unconditionally pay to such Fronting Lender the
amount of such Fronting Participant's Applicable Percentage of such unreimbursed
payment in Dollars and in immediately available funds. If, prior to 11:00 a.m.
(New York time) on any Business Day, the Administrative Agent so notifies any
Fronting Participant required to fund a payment under a Fronted Letter of
Credit, such Fronting Participant shall make available to such Fronting Lender
in Dollars and in immediately available funds such Fronting Participant's
Applicable Percentage of the amount of such payment on such Business Day (or, if
notice is given after 11:00 a.m. (New York time) on any Business Day, on the
next Business Day). If and to the extent such Fronting Participant shall not
have so made its Applicable Percentage of the amount of such payment available
to such Fronting Lender, such Fronting Participant agrees to pay to such
Fronting Lender, forthwith on demand such amount, together with interest
thereon, for each day from such date to but excluding the date such amount is
paid to such Fronting Lender at the overnight Federal Funds Rate. The failure of
any Fronting Participant to make available to such Fronting Lender its
Applicable Percentage of any payment under any Fronted Letter of Credit shall
not relieve any other Fronting Participant of its obligation hereunder to make
available to such Fronting Lender its Applicable Percentage of any payment on
the date required, as specified above, but no Fronting Participant shall be
responsible for the failure of any other Fronting Participant to make available
to such Fronting Lender such other Fronting Participant's Applicable Percentage
of any such payment.

         (d) Whenever any Fronting Lender receives any payment by any Borrower
as to which it has also received payments from the Fronting Participants
pursuant to paragraph (d) above, such Fronting Lender shall forward such payment
to the Administrative Agent, which in turn shall distribute to each Fronting
Participant which has paid its Applicable Percentage thereof, in Dollars and in
immediately available funds, an amount equal to such Fronting Participant's
share (based upon the amount funded by such Fronting Participant to the
aggregate amount funded by all Fronting Participants and retained by the
Fronting Lender) of the principal amount of such payment and interest thereon
accruing after the purchase of the respective participations.

         (e) The obligations of the Fronting Participants to make payments to
each Fronting Lender with respect to Fronted Letters of Credit issued by it
shall be irrevocable and not subject to any qualification or exception
whatsoever and shall be made in accordance with the terms and conditions of this
Agreement under all circumstances, including, without limitation, any of the
following circumstances:

         (i) any lack of validity or enforceability of this Agreement or any of
    the other Credit Documents or any amendment, supplement or modification to
    any of the foregoing;

                                      -37-

         (ii) the existence of any claim, setoff, defense or other right which
    the Fronting Participant or any of its Affiliates may have at any time
    against a beneficiary named in a Fronted Letter of Credit, any transferee of
    any Fronted Letter of Credit (or any Person for whom any such transferee may
    be acting), the Administrative Agent, any Fronting Lender, any Fronting
    Participant, any Lender, or any other Person, whether in connection with
    this Agreement, any Fronted Letter of Credit, the transactions contemplated
    herein or any unrelated transactions (including any underlying transaction
    between any Borrower or any of its Affiliates and the beneficiary named in
    any such Fronted Letter of Credit);

         (iii) any draft, certificate or any other document presented under any
    Fronted Letter of Credit proving to be forged, fraudulent, invalid or
    insufficient in any respect or any statement therein being untrue or
    inaccurate in any respect;

         (iv) the surrender or impairment of any security for the performance or
    observance of any of the terms of any of the Credit Documents; or

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

         (vi) any matter or event set forth in subsection 3.05(b).

         (f) Upon the request of any Fronting Participant, each Fronting Lender
shall furnish to such Fronting Participant copies of any Fronted Letter of
Credit issued by it and such other documentation as may reasonably be requested
by such Fronting Participant.

         Section 3.03. Conditions to the Issuance of all Letters of Credit. (a)
Notwithstanding anything to the contrary set forth in this Article III, no LC
Issuer shall be under any obligation to issue any Letter of Credit if at the
time of such issuance:

         (i) any order, judgment or decree of any Governmental Authority or
    arbitrator shall purport by its terms to enjoin or restrain such LC Issuer
    from issuing such Letter of Credit or any requirement of law applicable to
    such LC Issuer or any Lender or any request or directive (whether or not
    having the force of law) from any Governmental Authority with jurisdiction
    over such LC Issuer or any Lender shall prohibit, or request that such LC
    Issuer or any Lenders refrain from, the issuance of letters of credit
    generally or such Letter of Credit in particular or shall impose upon such
    LC Issuer or any Lender with respect to such Letter of Credit any
    restriction or reserve or capital requirement (for which such LC Issuer is
    not otherwise compensated) not in effect on the Effective Date, or any
    unreimbursed loss, cost or expense which was not applicable, in effect or
    known to such LC Issuer as of the Effective Date;

         (ii) the conditions precedent set forth in Section 5.02 are not
    satisfied at that time; or

         (iii) such LC Issuer shall have received notice from any Borrower or
    the Required Lenders prior to the issuance of such Letter of Credit of the
    type described in clause (v) of Section 3.03(b).

                                      -38-

         (b) Notwithstanding anything to the contrary set forth in this Article
III;

         (i) no Letter of Credit shall be issued at any time when the Revolving
    Credit Exposure exceeds (or would after giving effect to such issuance
    exceed) the Total Commitment at such time;

         (ii) no Letter of Credit shall be issued for the account of any
    Borrower at any time when the Revolving Credit Exposure attributable to such
    Borrower exceeds (or would after giving effect to such issuance exceed) the
    Borrowing Base of such Borrower at such time;

         (iii) no Fronted Letter of Credit shall be issued at any time if after
    giving effect thereto the Letter of Credit Outstandings in respect of all
    Fronted Letters of Credit would exceed $25,000,000;

         (iv) each Letter of Credit shall have an expiry date occurring not
    later than one year after such Letter of Credit's date of issuance, provided
    that each such Letter of Credit may by its terms automatically renew
    annually for one additional year unless the respective LC Issuer notifies
    the beneficiary thereof, in accordance with the terms of such Letter of
    Credit, that such Letter of Credit will not be renewed; and

         (v) no LC Issuer will issue any Letter of Credit after it has received
    written notice from any Borrower or the Required Lenders stating that a
    Default or an Event of Default exists until such time as the Issuing Agent
    shall have received a written notice of (x) rescission of such notice from
    the party or parties originally delivering the same or (y) a waiver of such
    Default or Event of Default by the Required Lenders.

         (c) Subject to and on the terms and conditions set forth herein, each
LC Issuer is hereby authorized by each Borrower and the Lenders to arrange for
the issuance of any Letter of Credit pursuant to Section 3.01(a) or (b) and the
amendment of any Letter of Credit pursuant to Section 3.08 and/or 11.02 by:

         (i) completing the commencement date and the expiry date of such Letter
    of Credit;

         (ii) (in the case of an amendment increasing or reducing the amount
    thereof) amending such Letter of Credit in such manner as such LC Issuer and
    the respective beneficiary may agree;

         (iii) in the case of Several Letters of Credit, completing such Letter
    of Credit with the participation of each Lender as allocated pursuant to the
    terms hereof; and

         (iv) in the case of Several Letters of Credit, executing such Letter of
    Credit on behalf of each Lender and following such execution delivering such
    Letter of Credit to the beneficiary of such Letter of Credit.

         Section 3.04. Letter of Credit Requests. (a) Whenever a Borrower
desires that a Letter of Credit be issued for its account, such Borrower shall
give the Administrative Agent and the

                                      -39-

respective LC Issuer written notice (including by way of facsimile transmission,
immediately confirmed in writing by submission of the original of such request
by mail to the Issuing Agent) thereof prior to 12:00 Noon (New York time) at
least (x) three Business Days in respect of Fronted Letters of Credit and (y)
five Business Days in respect of Several Letters of Credit, in each case, prior
to the proposed date of issuance (which shall be a Business Day), which written
notice shall be in the form of Exhibit G (each, a "Letter of Credit Request").
Each Letter of Credit Request shall include any other documents as the
respective LC Issuer customarily requires in connection therewith.

         (b) The making of each Letter of Credit Request shall be deemed to be a
representation and warranty by the respective Borrower and the Company that such
Letter of Credit may be issued in accordance with, and it will not violate the
requirements applicable to such Borrower and/or such Letter of Credit of,
Section 3.01 or 3.02, as the case may be, and Section 3.03.

         (c) Upon its issuance of, or amendment to, any Letter of Credit, the
respective LC Issuer shall promptly notify the respective Borrower and each
Lender of such issuance or amendment, which notice shall include a summary
description of the Letter of Credit actually issued and any amendments thereto.

         (d) The Stated Amount of each Letter of Credit upon issuance shall be
not less than $25,000.

         Section 3.05. Agreement to Repay Letter of Credit Drawings. (a) Each
Borrower severally agrees to reimburse (x) each Lender, by making payment to the
Administrative Agent in immediately available funds, for any payment or
disbursement made by such Lender under any Several Letter of Credit issued for
its account (each such amount so paid or disbursed until reimbursed, a "Several
Unpaid Drawing") and (y) the respective Fronting Lender directly for any payment
or disbursement made by such Fronting Lender under any Fronted Letter of Credit
issued for its account (each such amount so paid or disbursed until reimbursed,
a "Fronted Unpaid Drawing"), in each case, no later than one Business Day
following the date of such payment or disbursement, with interest on the amount
so paid or disbursed by such Lender, to the extent not reimbursed prior to 1:00
p.m. (New York time) on the date of such payment or disbursement, from and
including the date paid or disbursed to but not including the date such Lender
is reimbursed therefor at a rate per annum which shall be the Alternate Base
Rate as in effect from time to time (plus an additional 2% per annum, payable on
demand, if not reimbursed by the third Business Day after the date on which the
respective Borrower receives notice from the respective LC Issuer of such
payment or disbursement).

         (b) Each Borrower's obligation under this Section 3.05 to reimburse
each Lender with respect to Unpaid Drawings of such Borrower (including, in each
case, interest thereon) shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
which such Borrower may have or have had against such Lender, or any LC Issuer,
including, without limitation, any defense based upon the failure of any drawing
under a Letter of Credit to conform to the terms of the Letter of Credit or any
non-application or misapplication by the beneficiary of the proceeds of such
drawing; provided, however, that no Borrower shall be obligated to reimburse any
Lender for any wrongful payment made by such Lender under a Letter of Credit as
a result of acts or omissions

                                      -40-

constituting willful misconduct or gross negligence on the part of such Lender
(as determined by a court of competent jurisdiction in a final and
non-appealable decision).

         (c) In determining whether to pay under any Letter of Credit, no LC
Issuer shall have any obligation relative to the other Lenders other than to
confirm that any documents required to be delivered under such Letter of Credit
appear to have been delivered and that they appear to substantially comply on
their face with the requirements of such Letter of Credit. Any action taken or
omitted to be taken by any LC Issuer under or in connection with any Letter of
Credit, if taken or omitted in the absence of such LC Issuer's gross negligence
or willful misconduct (as determined by a court of competent jurisdiction in a
final and non-appealable decision), shall not create for such LC Issuer any
resulting liability to any Borrower or any of its Affiliates or any Lender.

         Section 3.06. Increased Costs. If after the Effective Date, the
adoption or effectiveness of any applicable law, rule or regulation, order,
guideline or request or any change therein after the Effective Date, or any
change adopted or effective after the Effective Date in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender with any request or directive (whether or not having the force of
law) by any such authority, central bank or comparable agency shall either (i)
impose, modify or make applicable any reserve, deposit, capital adequacy or
similar requirement against letters of credit issued by or participated in by
such Lender, or (ii) impose on such Lender any other conditions directly or
indirectly affecting this Agreement or any Letter of Credit; and the result of
any of the foregoing is to increase the cost to such Lender of issuing,
maintaining or participating in any Letter of Credit, or to reduce the amount of
any sum received or receivable by such Lender hereunder or reduce the rate of
return on its capital with respect to Letters of Credit, then, upon written
demand to the applicable Borrower by such Lender (with a copy to the
Administrative Agent), such Borrower shall pay to such Lender such additional
amount or amounts as will compensate such Lender for such increased cost or
reduction. The preceding sentence shall not apply to increased costs with
respect to taxes imposed on or measured by the net income or net profits of a
Lender pursuant to the laws of the jurisdiction in which it is organized or the
jurisdiction in which the principal office or applicable lending office of such
Lender is located or any subdivision thereof or therein or with respect to Taxes
to the extent that a Lender received additional amounts (or otherwise was
indemnified) for such Taxes pursuant to Section 2.14 (or would have received
additional amounts pursuant to Section 2.14(e) but for a failure to comply with
Section 2.14(e)). A certificate submitted to the applicable Borrower by such
Lender (with a copy to the Administrative Agent), setting forth (i) the basis
for the determination of such additional amount or amounts necessary to
compensate such Lender as aforesaid and (ii) the basis, in reasonable detail,
for the computation of such amount or amounts, which shall be consistently
applied shall be final and conclusive and binding on the applicable Borrower
absent manifest error, although the failure to deliver any such certificate
shall not release or diminish such Borrower's obligations to pay additional
amounts pursuant to this Section 3.06 upon subsequent receipt of such
certificate.

         Section 3.07. Letter of Credit Expiration Extensions. Each Lender
acknowledges that to the extent provided under the terms of any Letter of
Credit, the expiration date of such Letter of Credit will be automatically
extended for an additional year, without written

                                      -41-

amendment, unless at least 30 days (or such other period required under or by
any Legal Requirement or Applicable Insurance Regulatory Authority) prior to the
expiration date of such Letter of Credit, notice is given by the respective LC
Issuer in accordance with the terms of the respective Letter of Credit (a
"Notice of Non-Extension") that the expiration date of such Letter of Credit
will not be extended beyond its current expiration date. The respective LC
Issuer will give Notices of Non-Extension as to any or all outstanding Letters
of Credit if requested to do so by the Required Lenders pursuant to Article
VIII. The respective LC Issuer will give Notices of Non-Extension as to all
outstanding Letters of Credit if the Commitment Expiration Date has occurred.
The respective LC Issuer will send a copy of each Notice of Non-Extension to the
respective Borrower concurrently with delivery thereof to the respective
beneficiary, unless prohibited by law from doing so.

         Section 3.08. Changes to Stated Amount. At any time when any Letter of
Credit is outstanding, at the request of the respective Borrower, the Issuing
Agent will enter into an amendment increasing or reducing the Stated Amount of
such Letter of Credit, provided that (i) in no event shall the Stated Amount of
such Letter of Credit be increased to an amount which would cause (x) the
Revolving Credit Exposure to exceed the Total Commitment at such time, (y) the
Revolving Credit Exposure attributable to such Borrower to exceed the Borrowing
Base of such Borrower at such time or (z) the Letter of Credit Outstandings in
respect of Fronted Letters of Credit to exceed $25,000,000, (ii) the Stated
Amount of a Letter of Credit may not be increased at any time if the conditions
precedent set forth in Section 5.02 are not satisfied at such time, and (iii)
the Stated Amount of a Letter of Credit may not be increased at any time after
the Commitment Expiration Date.

         Section 3.09. Existing Letters of Credit. It is hereby agreed and
acknowledged that all letters of credit described on Schedule 3.09 (the
"Existing Letters of Credit" and each, an "Existing Letter of Credit") which
were issued by JPMorgan Chase Bank and remain outstanding on the Effective Date
shall (i) to the extent any Existing Letter of Credit shall not have been
amended pursuant to Section 5.01(m) or Section 6.13 to satisfy the requirements
of a Several Letter of Credit hereunder, such Existing Letter of Credit shall be
deemed issued under this Agreement as a Fronted Letter of Credit on the
Effective Date and (ii) to the extent any Existing Letter of Credit shall have
been amended pursuant to Section 5.01(m) or Section 6.13 to satisfy the
requirements of a Several Letter of Credit hereunder, such Existing Letter of
Credit shall be deemed issued under this Agreement as a Several Letter of Credit
on the Effective Date.

                                   ARTICLE IV

                         Representations and Warranties

         Each of the Company and each Designated Subsidiary Borrower, in each
case, on behalf of itself and its Subsidiaries represents and warrants to the
Lenders that:

         Section 4.01. Corporate Status. Each of the Company and each of its
Subsidiaries (i) is a duly organized and validly existing corporation or
business trust or other entity in good standing under the laws of the
jurisdiction of its organization and has the corporate or other organizational
power and authority to own its property and assets and to transact the business
in which it is engaged and presently proposes to engage, and (ii) has been duly
qualified

                                      -42-

and is authorized to do business and is in good standing in all jurisdictions
where it is required to be so qualified, except, in the case of this clause
(ii), where the failure to be so qualified, authorized or in good standing could
not reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

         Section 4.02. Corporate Power and Authority. Each Borrower has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
of such Credit Documents. Each Borrower has duly executed and delivered each
Credit Document to which it is a party and each such Credit Document constitutes
the legal, valid and binding obligation of such Borrower enforceable against
such Borrower in accordance with its terms, except to the extent that
enforceability thereof may be limited by applicable bankruptcy, insolvency,
moratorium or similar laws affecting creditors' rights generally and general
principles of equity regardless of whether enforcement is sought in a proceeding
in equity or at law.

         Section 4.03. No Contravention of Laws, Agreements or Organizational
Documents. Neither the execution, delivery and performance by any Borrower of
this Agreement or the other Credit Documents to which it is a party nor
compliance with the terms and provisions thereof, nor the consummation of the
transactions contemplated therein, (i) will contravene any applicable provision
of any law, statute, rule, regulation, order, writ, injunction or decree of any
court or governmental instrumentality, (ii) will conflict or be inconsistent
with or result in any breach of any of the terms, covenants, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) any Lien (other than Liens
in favor the Administrative Agent and the Lenders pursuant to the Security
Documents) upon any of the property or assets of the Company or any of its
Subsidiaries pursuant to the terms of, any indenture, mortgage, deed of trust,
loan agreement, credit agreement or any other material instrument to which the
Company or any of its Subsidiaries is a party or by which it or any of its
property or assets are bound or to which it may be subject or (iii) will violate
any provision of the certificate of incorporation, by-laws or other
organizational documents of the Company or any of its Subsidiaries.

         Section 4.04. Litigation and Contingent Liabilities. There are no
actions, suits or proceedings pending or threatened in writing involving the
Company or any of its Subsidiaries (including, without limitation, with respect
to this Agreement or any other Credit Document) that have had, or could
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

         Section 4.05. Use of Proceeds; Margin Regulations. (a) All proceeds of
the Loans shall be utilized for the general corporate and working capital
purposes of the Company and its Subsidiaries.

         (b) Neither the making of any Loan hereunder, nor the use of the
proceeds thereof, will violate or be inconsistent with the provisions of
Regulation T, U or X and no part of the proceeds of any Loan will be used to
purchase or carry any Margin Stock or to extend credit for the purpose of
purchasing or carrying any Margin Stock.

                                      -43-

         Section 4.06. Approvals. Any order, consent, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, which is required to authorize or is required in
connection with (i) the execution, delivery and performance of any Credit
Document or (ii) the legality, validity, binding effect or enforceability of any
Credit Document, has been obtained and is in full force and effect.

         Section 4.07. Investment Company Act. No Borrower is an "investment
company" or a company "controlled" by an "investment company," within the
meaning of the Investment Company Act of 1940, as amended.

         Section 4.08. Public Utility Holding Company Act. No Borrower is a
"holding company," or a "subsidiary company" of a "holding company," or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended.

         Section 4.09. True and Complete Disclosure; Projections and
Assumptions. All factual information (taken as a whole) heretofore or
contemporaneously furnished by the Company or any of its Subsidiaries to the
Administrative Agent or any Lender in writing (including, without limitation,
all information contained in the Credit Documents) for purposes of or in
connection with this Agreement or any transaction contemplated herein is, and
all other factual information (taken as a whole with all other such information
theretofore or contemporaneously furnished) hereafter furnished by any such
Persons in writing to the Administrative Agent will be, true and accurate in all
material respects on the date as of which such information is dated and not
incomplete by omitting to state any material fact necessary to make such
information (taken as a whole with all other such information theretofore or
contemporaneously furnished and all filings by the Company with the Securities
and Exchange Commission) not misleading at such time in light of the
circumstances under which such information was provided; provided that, with
respect to projections the Company represents only that the projections
contained in such materials are based on good faith estimates and assumptions
believed by the Company to be reasonable and attainable at the time made, it
being recognized by the Lenders that such projections as to future events are
not to be viewed as facts and are subject to significant uncertainties and
contingencies many of which are beyond the Company's control and that actual
results during the period or periods covered by any such projections may differ
from the projected results.

         Section 4.10. Financial Condition; Financial Statements. (a) The
audited consolidated balance sheet of the Company for the fiscal year ended
December 31, 2003 and the related consolidated statements of income,
shareholders' equity and cash flows, reported on by PricewaterhouseCoopers LLP,
copies of which have been delivered to each of the Lenders, and the unaudited
consolidated balance sheet of the Company for its fiscal quarter ended March 31,
2004 and the related consolidated statements of income, shareholders' equity and
cash flows, copies of which have been delivered to each of the Lenders, fairly
present in all material respects, in each case in conformity with GAAP,
consistently applied, the consolidated financial position of the Company and its
Subsidiaries as of such dates and their consolidated results of operations and
cash flows for such periods stated (subject, in the case of the aforementioned

                                      -44-

quarterly financial statement to normal year-end audit adjustments and the
absence of full footnote disclosure).

         (b) Since December 31, 2003, nothing has occurred which has had, or
could reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

         (c) Except (i) for the Loans, (ii) as set forth in the unaudited
consolidated balance sheet (including the footnote disclosures thereto) of the
Company for its fiscal quarter ended March 31, 2004 and (iii) liabilities
incurred in the ordinary course of business after March 31, 2004, on the
Effective Date there are no material liabilities of the Company and its
Subsidiaries.

         (d) On and as of the Effective Date, on a pro forma basis after giving
effect to the Transaction, (i) the fair valuation of all of the assets of (x)
each Borrower (on an individual basis) and (y) the Company and its Subsidiaries
taken as a whole will, in each case, exceed its debts, (ii) no Borrower will
have incurred or intended to incur debts beyond its ability to pay such debts as
such debts mature and (iii) no Borrower will have unreasonably small capital
with which to conduct its business as conducted on the Effective Date. For
purposes of this Section 4.10, "debt" means any liability on a claim, and
"claim" means any (i) right to payment whether or not such a right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured; or (ii) right to
an equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured.

         Section 4.11. Tax Returns and Payments. The Company and its
Subsidiaries (i) have timely filed or caused to be timely filed with the
appropriate taxing authority (taking into account any applicable extension
within which to file) all material income and other material tax returns
(including any statements, forms and reports), domestic and foreign, required to
be filed by the Company and its Subsidiaries, and (ii) have timely paid or
caused to have timely paid all material taxes payable by them which have become
due and assessments which have become due, except for those contested in good
faith and adequately disclosed and for which adequate reserves have been
established in accordance with GAAP. There is no action, suit, proceeding,
investigation, audit or claim now pending or, to the best knowledge of the
Company and its Subsidiaries, proposed or threatened by any authority regarding
any income taxes or any other taxes relating to the Company or any of its
Subsidiaries, which could individually or in the aggregate reasonably be
expected to have a Material Adverse Effect. As of the Effective Date, neither
the Company nor any of its Subsidiaries has entered into an agreement or waiver
or been requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of taxes of the Company or any
of its Subsidiaries. No tax Liens have been filed and no claims are pending or,
to the best knowledge of the Company or any of its Subsidiaries, proposed or
threatened with respect to any taxes, fees or other charges for any taxable
period, except for Liens permitted under Section 7.03 and claims which could not
reasonably be expected to have a Material Adverse Effect.

         Section 4.12. Compliance with ERISA. (a) Except as could not reasonably
be expected to result, individually or in the aggregate, in a Material Adverse
Effect, the Company

                                      -45-

and its Subsidiaries and ERISA Affiliates (i) have fulfilled their respective
obligations under the minimum funding standards of ERISA and the Code with
respect to each Plan and are in compliance with the applicable provisions of
ERISA and the Code, and (ii) have not incurred any liability to the PBGC or any
Plan or Multiemployer Plan (other than to make contributions in the ordinary
course of business).

         (b) Except as could not reasonably be expected to result, individually
or in the aggregate, in a Material Adverse Effect, (i) each Foreign Pension Plan
has been maintained in compliance with its terms and with the requirements of
any and all applicable laws, statutes, rules, regulations and orders and has
been maintained, where required, in good standing with applicable regulatory
authorities, (ii) all contributions required to be made with respect to a
Foreign Pension Plan have been timely made, (iii) neither the Company nor any of
its Subsidiaries has incurred any obligation in connection with the termination
of, or withdrawal from, any Foreign Pension Plan and (iv) the present value of
the accrued benefit liabilities (whether or not vested) under each Foreign
Pension Plan that is required to be funded, determined as of the end of the
Company's most recently ended fiscal year on the basis of actuarial assumptions,
each of which is reasonable, did not exceed the current value of the assets of
such Foreign Pension Plan allocable to such benefit liabilities.

         Section 4.13. Subsidiaries. (a) Set forth on Schedule 4.13(a) is a
complete and correct list of all of the Subsidiaries of the Company as of the
Effective Date, together with, for each such Subsidiary, (i) the jurisdiction of
organization of such Subsidiary, (ii) each Person holding direct ownership
interests in such Subsidiary and (iii) the percentage ownership of such
Subsidiary represented by such ownership interests. Except as disclosed on
Schedule 4.13, as of the Effective Date, each of the Company and its
Subsidiaries owns, free and clear of Liens, and has the unencumbered right to
vote, all outstanding ownership interests in each Person shown to be held by it
on Schedule 4.13.

         (b) As of the Effective Date, there are no restrictions on the Company
or any of its Subsidiaries which prohibit or otherwise restrict the transfer of
cash or other assets from any Subsidiary of the Company to the Company, other
than (i) prohibitions or restrictions existing under or by reason of this
Agreement or the other Credit Documents, (ii) prohibitions or restrictions
existing under or by reason of Legal Requirements, (iii) prohibitions and
restrictions permitted by Section 7.11 and (iv) other prohibitions or
restrictions which, either individually or in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.

         Section 4.14. Capitalization. As of the Effective Date, the authorized
capital stock of the Company consists of (i) 200,000,000 common shares, $.01 par
value per share, 56,798,218 of which shares are issued and outstanding and, (ii)
25,000,000 preference shares, $.01 par value per share, none of which are issued
and outstanding. As of the Effective Date, none of the Company's Subsidiaries
has outstanding any securities convertible into or exchangeable for its capital
stock or outstanding any rights to subscribe for or to purchase, or any options
for the purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to,
its capital stock except for options, warrants and grants outstanding in the
aggregate amounts set forth on Schedule 4.14.

                                      -46-

         Section 4.15. Indebtedness. The Company and its Subsidiaries do not
have any Indebtedness on the Effective Date other than (i) the Loans, and (ii)
the Indebtedness listed on Schedule 4.15.

         Section 4.16. Compliance with Statutes, etc. The Company and each of
its Subsidiaries is in compliance with all applicable statutes, regulations,
rules and orders of, and all applicable restrictions imposed by, and has filed
or otherwise provided all material reports, data, registrations, filings,
applications and other information required to be filed with or otherwise
provided to, all governmental bodies, domestic or foreign, in respect of the
conduct of its business and the ownership of its property (including compliance
with all applicable environmental laws), except where the failure to comply or
file or otherwise provide could not reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect. All required
regulatory approvals are in full force and effect on the date hereof, except
where the failure of such approvals to be in full force and effect could not
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect.

         Section 4.17. Insurance Licenses. Schedule 4.17 lists with respect to
each Regulated Insurance Company, as of the Effective Date, all of the
jurisdictions in which such Regulated Insurance Company holds licenses
(including, without limitation, licenses or certificates of authority from
Applicable Insurance Regulatory Authorities), permits or authorizations to
transact insurance and reinsurance business (collectively, the "Insurance
Licenses"), and indicates the type or types of insurance in which each such
Regulated Insurance Company is permitted to be engaged with respect to each
Insurance License therein listed. There is (i) no such Insurance License that is
the subject of a proceeding for suspension, revocation or limitation or any
similar proceedings, (ii) no sustainable basis for such a suspension, revocation
or limitation, and (iii) no such suspension, revocation or limitation threatened
by any Applicable Insurance Regulatory Authority, that, in each instance under
(i), (ii) and (iii) above, has had, or could reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect. As of the
Effective Date, no Regulated Insurance Company transacts any insurance business,
directly or indirectly, in any jurisdiction other than those listed on Schedule
4.17, where such business requires any Insurance License of an Applicable
Insurance Regulatory Authority or such jurisdiction.

         Section 4.18. Insurance Business. All insurance policies issued by any
Regulated Insurance Company are, to the extent required under applicable law, on
forms approved by the insurance regulatory authorities of the jurisdiction where
issued or have been filed with and not objected to by such authorities within
the period provided for objection, except for those forms with respect to which
a failure to obtain such approval or make such a filing without it being
objected to, could not reasonably be expected to have, either individually or in
the aggregate, a Material Adverse Effect.

         Section 4.19. Security Documents. The Security Documents create, as
security for the obligations hereunder of the Company and each Designated
Subsidiary Borrower, valid and enforceable security interests in and Liens on
all of the Collateral, superior to and prior to the rights of all third persons
and subject to no other Liens. No filings or recordings are required in order to
ensure the enforceability, perfection or priority of the security interests
created under the Security Documents, except for filings or recordings which
shall have been previously made.

                                      -47-

         Section 4.20. Properties; Liens. (a) The Company and its Subsidiaries
have good title to, or valid leasehold interests in, all real and personal
property material to their respective businesses. There exists no Lien
(including any Lien arising out of any attachment, judgment or execution), nor
any segregation or other preferential arrangement of any kind, on, in or with
respect to any of the property of the Company or any of its Subsidiaries, in
each case except as expressly permitted by Section 7.03.

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

         Section 4.21. Solvency. On the Effective Date and upon the occurrence
of each Credit Event, both before and after giving effect thereto, (i) each
Borrower, taken individually, (ii) the Company and its Subsidiaries, taken as a
whole and (iii) each Borrower and its respective Subsidiaries, taken as a whole,
are, in each case, Solvent.

         Section 4.22. Certain Insurance Regulations, Orders, Consents, Etc.
Without limiting the generality of Sections 4.03, 4.06, 4.16 or any other
provision contained in this Agreement, immediately after giving effect to the
pledging of any asset under any Security Document, each Credit Event (and the
satisfaction of all Borrowing Base requirements in connection therewith) and
each Collateral Transfer (as defined in the Security Agreement), each Borrower
will be in compliance with the applicable provisions of any insurance law,
statute, rule, regulation or order of any governmental agency, public body or
authority, or any subdivision thereof, regulating the activities of such
Borrower with respect to any limitations on Liens granted on any Collateral (as
defined in the Security Agreement) by such Borrower to the Collateral Agent (or
purported to be granted pursuant to any Security Document) including without
limitation, IC 27-1-23-4 of the Indiana Insurance Law, Section 1411(c) of the
New York Insurance Law and Section 10-3-801 and Regulation 3-4-1 of the Colorado
Insurance Company Holdings Act (as applicable) to the extent such Borrower is
subject thereto and any other similar law, regulation, order or statute of any
other jurisdiction to which such Borrower is subject; provided that such failure
to comply could adversely affect the validity, perfection or priority of any
such Lien or the rights or remedies of the Lenders or the ability of such
Borrower to perform its obligations to the Lenders under this Agreement or any
other Credit Document.

                                    ARTICLE V

                                   Conditions

         Section 5.01. Effective Date. The obligations of the Lenders to make
Loans and the obligation of each LC Issuer to issue Letters of Credit shall not
become effective until the date (the "Effective Date") on which each of the
following conditions is satisfied (or waived in accordance with Section 11.02):

         (a) On or prior to the Effective Date, (i) each of the Company, each
    Designated Subsidiary Borrower listed on Schedule 2.17, the Administrative
    Agent and

                                      -48-

    each of the Lenders shall have signed a copy hereof (whether the same or
    different copies) and shall have delivered the same to the Administrative
    Agent in accordance with Section 11.01(a) or, in the case of the Lenders,
    shall have given to the Administrative Agent telephonic (confirmed in
    writing), written or facsimile transmission notice (actually received) in
    accordance with Section 11.01(a) that the same has been signed and mailed to
    the Administrative Agent; and (ii) there shall have been delivered to the
    Administrative Agent for the account of each Lender that has requested the
    same pursuant to Section 2.07(e) the appropriate promissory note or
    promissory notes, executed by the Company, in each case, in the amount,
    maturity and as otherwise provided herein.

         (b) On the Effective Date, the Administrative Agent shall have received
    (i) an opinion, in form and substance reasonably satisfactory to the
    Administrative Agent, addressed to the Administrative Agent and each of the
    Lenders and dated the Effective Date, from Baker & McKenzie, special New
    York counsel to the Borrowers, which opinion shall cover the matters
    contained in Exhibit I-1 hereto and (ii) an opinion, in form and substance
    reasonably satisfactory to the Administrative Agent, addressed to the
    Administrative Agent and each of the Lenders and dated the Effective Date,
    from Conyers, Dill & Pearman, special Bermuda counsel to the Borrowers,
    which opinion shall cover the matters covered in Exhibit I-2 hereto.

         (c) (i) On the Effective Date, the Administrative Agent shall have
    received, from each Borrower, a certificate, dated the Effective Date,
    signed by an Authorized Officer of such Borrower, and attested to by the
    Secretary or any Assistant Secretary of such Borrower, in the form of
    Exhibit F hereto with appropriate insertions and deletions, together with
    (x) copies of its certificate of incorporation, by-laws or other
    organizational documents and (y) the resolutions of the board of directors
    of such Borrower relating to the Credit Documents which shall be
    satisfactory to the Administrative Agent.

         (ii) On or prior to the Effective Date, all corporate and legal
    proceedings and all instruments and agreements in connection with the
    transactions contemplated by this Agreement and the other Credit Documents
    shall be reasonably satisfactory in form and substance to the Administrative
    Agent, and the Administrative Agent shall have received all information and
    copies of all certificates, documents and papers, including certificates of
    existence or good standing certificates, as applicable, and any other
    records of corporate proceedings and governmental approvals, if any, which
    the Administrative Agent reasonably may have requested in connection
    therewith, such documents and papers where appropriate to be certified by
    proper corporate or governmental authorities.

         (d) Since December 31, 2003, nothing shall have occurred or become
    known to the Administrative Agent or the Required Lenders which has had, or
    could reasonably be expected to have, either individually or in the
    aggregate, a Material Adverse Effect.

         (e) On the Effective Date, no actions, suits or proceedings by any
    entity (private or governmental) shall be pending against the Company or any
    of its Subsidiaries (i) with respect to this Agreement, any other Credit
    Document, the Transaction or (ii) which has had, or could reasonably be
    expected to have, either individually or in the aggregate, a Material
    Adverse Effect.

                                      -49-

         (f) On the Effective Date, all governmental and third party approvals,
    permits and licenses required to be obtained in connection with the
    Transaction on or prior to the Effective Date shall have been obtained and
    remain in full force and effect.

         (g) On the Effective Date, the Company and its Subsidiaries shall have
    no outstanding preferred stock or Indebtedness except (x) the Loans, and (y)
    preferred stock or Indebtedness set forth on Schedule 4.15.

         (h) On the Effective Date, there shall exist no Default or Event of
    Default, and all representations and warranties made by each Borrower
    contained herein or in any other Credit Document to which it is a party
    shall be true and correct in all material respects (it being understood and
    agreed that any representation or warranty which by its terms is made as of
    a specified date shall be required to be true and correct in all material
    respects only as of such specified date).

         (i) On the Effective Date, each Regulated Insurance Company which has a
    rating in effect on the Closing Date shall have an A.M. Best financial
    strength rating of at least "A-".

         (j) On the Effective Date, the Company shall have paid the
    Administrative Agent and the Lenders all fees, reasonable out-of-pocket
    expenses (including, without limitation, legal fees and expenses of the
    Administrative Agent) and other compensation contemplated by this Agreement
    and the other Credit Documents, agreed upon by such parties to be paid on or
    prior to the Effective Date.

         (k) On or prior to the Effective Date, the Administrative Agent shall
    have received counterparts of the Security Agreement executed by each
    Borrower, together with:

              (i) all documents and instruments, including Uniform Commercial
         Code financing statements where applicable, required by law in each
         applicable jurisdiction or reasonably requested by the Administrative
         Agent to be filed, registered or recorded to create or perfect the
         Liens intended to be created under the Security Agreement;

              (ii) results of a recent search of the Uniform Commercial Code (or
         equivalent) filings made with respect to each Borrower in the
         jurisdictions contemplated in clause (i) above (including, without
         limitation, Washington, D.C., and Bermuda) and in such other
         jurisdictions in which Collateral is located on the Effective Date
         which may be reasonably requested by the Administrative Agent, and
         copies of the financing statements (or similar documents) disclosed by
         such search and evidence reasonably satisfactory to the Administrative
         Agent that the Liens indicated by such financing statements (or similar
         documents) are permitted by the Security Agreement or have been
         released; and

              (iii) for each Collateral Account, a "control agreement" with JP
         Morgan Chase Bank in the form specified in the Security Agreements
         (appropriately completed), with such changes thereto as may be
         acceptable to the

                                      -50-

         Administrative Agent and each such control agreement shall be in full
         force and effect;

         and the Security Agreement shall be in full force and effect.

         (l) On the Effective Date, the Administrative Agent shall have received
    a letter from the Service of Process Agent, presently located at 111 Eighth
    Avenue, 13th Floor, New York, New York 10011 in form and substance
    satisfactory to the Administrative Agent, indicating its consent to its
    appointment by the Company and each Designated Subsidiary Borrower as their
    agent to receive service of process as specified in this Agreement.

         (m) On the Effective Date, the Administrative Agent shall be reasonably
    satisfied that the Company and each Designated Subsidiary Borrower that is
    an account party under any Existing Letter of Credit, shall have used its
    commercially reasonable efforts to amend such Existing Letter of Credit
    (including, without limitation, by obtaining all necessary consents by
    beneficiaries in connection therewith) so that such Existing Letter of
    Credit shall satisfy the requirements of a Several Letter of Credit issued
    hereunder (it being understood and agreed that each such Existing Letter of
    Credit so amended after the Effective Date shall in accordance with Article
    III be deemed to be a Several Letter of Credit issued hereunder); provided
    that the Company and such Designated Subsidiary Borrower shall only be
    required to use their commercially reasonable efforts so that after giving
    effect to such amendments no more than an aggregate Stated Amount equal to
    $12,500,000 of Existing Letters of Credit are not so amended as Several
    Letters of Credit hereunder.

         The Administrative Agent shall notify the Company and the Lenders of
the Effective Date, and such notice shall be conclusive and binding.

         Section 5.02. Each Credit Event. The obligation of each Lender to make
each Loan (including Loans made on the Effective Date), and the obligation of
each LC Issuer to issue each Letter of Credit (including Letters of Credit
issued on the Effective Date) or to increase the Stated Amount thereof is
subject, at the time of each such Credit Event, to the satisfaction of the
following conditions:

         (a) The Effective Date shall have occurred;

         (b) (i) There shall exist no Default or Event of Default and (ii) all
    representations and warranties contained herein or in the other Credit
    Documents shall be true and correct in all material respects with the same
    effect as though such representations and warranties had been made on the
    date of such Credit Event (it being understood and agreed that any
    representation or warranty which by its terms is made as of a specified date
    shall be required to be true and correct in all material respects only as of
    such specified date);

         (c) The Administrative Agent shall have determined that there is
    sufficient availability in respect of each relevant Borrowing Base at the
    time of each Credit Event;

                                      -51-

         (d) In the case of any making of Loans, the Administrative Agent shall
    have received a Borrowing Request meeting the requirements of Section 2.03
    with respect to each incurrence of Loans;

         (e) In the case of any issuance of Letters of Credit, the
    Administrative Agent shall have received a Letter of Credit Request meeting
    the requirements of Section 3.04; and

         (f) In the case of any issuance of Letters of Credit, all of the
    applicable conditions set forth in Section 3.03(a) and (b) shall have been
    satisfied.

         Each occurrence of a Credit Event shall be deemed to constitute a
representation and warranty by the applicable Borrower and the Company on the
date thereof as to the matters specified in paragraphs (a) and (b) of this
Section 5.02.

                                   ARTICLE VI

                              Affirmative Covenants

         Until the Total Commitment (and the Commitment of each Lender) and each
Letter of Credit has expired or been terminated and all Unpaid Drawings, the
principal of and interest on each Loan, and all fees payable hereunder shall
have been irrevocably paid in full, each of the Company and each Designated
Subsidiary Borrower covenants and agrees with the Lenders that:

         Section 6.01. Information Covenants. The Company will furnish to each
Lender:

         (a) Annual Financial Statements. As soon as available and in any event
within 90 days after the close of each fiscal year of the Company, the
consolidated balance sheet of the Company and its Subsidiaries as at the end of
such fiscal year and the related consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and its Subsidiaries for such
fiscal year, setting forth in comparative form the consolidated figures for the
previous fiscal year, all in reasonable detail and accompanied by a report
thereon of PricewaterhouseCoopers LLP or other independent public accountants of
recognized national standing selected by the Company, which report shall state
that such consolidated financial statements present fairly in all material
respects the consolidated financial position of the Company and its Subsidiaries
as at the dates indicated and their consolidated results of operations and cash
flows for the periods indicated in conformity with GAAP and that the audit by
such accountants in connection with such consolidated financial statements has
been made in accordance with generally accepted auditing standards.

         (b) Quarterly Financial Statements. As soon as available and in any
event within 45 days after the close of each of the first three quarterly
accounting periods in each fiscal year of the Company, consolidated balance
sheets of the Company and its Subsidiaries as at the end of such period and the
related consolidated statements of income, changes in shareholders' equity and
cash flows of the Company and its Subsidiaries for such period and (in the case
of the second and third quarterly periods) for the period from the beginning of
the current fiscal year to the end of such quarterly period, setting forth in
each case in comparative form the consolidated

                                      -52-

figures for the corresponding periods of the previous fiscal year, all in
reasonable detail and certified by the chief financial officer of the Company as
presenting fairly in all material respects, in accordance with GAAP, the
information contained therein, subject to changes resulting from normal year-end
audit adjustments and the absence of full footnote disclosure.

         (c) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 6.01(a) and 6.01(b), a certificate
of a Financial Officer of the Company to the effect that no Default or Event of
Default exists or, if any Default or Event of Default does exist, specifying the
nature and extent thereof, which certificate shall set forth the calculations
required to establish whether the Company and its Subsidiaries were in
compliance with the provisions of Sections 7.09, 7.10 and 7.11, as at the end of
such fiscal year or quarter, as the case may be.

         (d) Notice of Default or Litigation. (x) Within five Business Days
after the Company becomes aware of the occurrence of any Default and/or any
event or condition constituting, or which could reasonably be expected to have,
a Material Adverse Effect, a certificate of an Authorized Officer of the Company
setting forth the details thereof and the actions which the Company is taking or
proposes to take with respect thereto and (y) promptly after the Company knows
of the commencement thereof, notice of any litigation, dispute or proceeding
involving a claim against the Company and/or any Subsidiary which claim could
reasonably be expected to have a Material Adverse Effect.

         (e) Other Statements and Reports. Promptly upon the mailing thereof to
the security holders of the Company generally, copies of all financial
statements, reports and proxy statements so mailed.

         (f) SEC Filings. Promptly upon the filing thereof, copies of (or, to
the extent same is publicly available via the SEC's "EDGAR" filing system,
written notification of the filing of) all registration statements (other than
the exhibits thereto and any registration statements on Form S-8 or its
equivalent) and annual or quarterly reports which the Company shall have filed
with the SEC or any national securities exchange.

         (g) Insurance Reports and Filings.

         (i) Promptly after the filing thereof, a copy of each Statutory
    Statement filed by each Regulated Insurance Company.

         (ii) Promptly following the delivery or receipt, as the case may be, by
    any Regulated Insurance Company or any of their respective Subsidiaries,
    copies of (a) each material registration, filing or submission made by or on
    behalf of any Regulated Insurance Company with any Applicable Insurance
    Regulatory Authority, except for policy form or rate filings, (b) each
    material examination and/or audit report submitted to any Regulated
    Insurance Company by any Applicable Insurance Regulatory Authority, (c) all
    material information which the Lenders may from time to time request with
    respect to the nature or status of any deficiencies or violations reflected
    in any examination report or other similar report, and (d) each material
    report, order, direction, instruction, approval, authorization, license or
    other notice which the Company or any Regulated

                                      -53-

    Insurance Company may at any time receive from any Applicable Insurance
    Regulatory Authority.

         (iii) As soon as available and in any event within 120 days after the
    end of each fiscal year of the Company, a report by an independent actuarial
    consulting firm of recognized national standing reviewing the adequacy of
    loss and loss adjustment expense reserves as at the end of the last fiscal
    year of the Company and its Subsidiaries on a consolidated basis, determined
    in accordance with SAP and stating that the Regulated Insurance Companies
    have maintained adequate reserves, it being agreed that in each case such
    independent firm will be provided access to or copies of all relevant
    valuations relating to the insurance business of each such Regulated
    Insurance Company in the possession of or available to the Company or its
    Subsidiaries.

         (iv) Promptly following notification thereof from a Governmental
    Authority, notification of the suspension, limitation, termination or
    non-renewal of, or the taking of any other materially adverse action in
    respect of, any material Insurance License.

         (h) Borrowing Base Certificate. No later than the tenth Business Day of
each month, a Borrowing Base Certificate from each Borrower as of the last day
of the immediately preceding month, executed by an Authorized Officer of such
Borrower.

         (i) Other Information. With reasonable promptness, such other
information or existing documents (financial or otherwise) as the Administrative
Agent or any Lender may reasonably request from time to time.

         (j) Delivery of Information. Each Borrower and each Lender hereby
acknowledges and agrees that notwithstanding anything to the contrary contained
in Section 11.12 of this Agreement, the Administrative Agent and/or the Company
may make available to the Lenders materials and/or information provided by or on
behalf of any Borrower under this Agreement or any other Credit Document by
posting such materials and/or information on IntraLinks or another similar
electronic system reasonably acceptable to the Administrative Agent and the
Company.

         Section 6.02. Books, Records and Inspections. The Company will (i)
keep, and will cause each of its Subsidiaries to keep, proper books of record
and account in which full, true and correct entries in conformity with GAAP or
SAP, as applicable, shall be made of all dealings and transactions in relation
to its business and activities; and (ii) subject to binding contractual
confidentiality obligations of the Company and its Subsidiaries to third parties
and to Section 11.12, permit, and will cause each of its Subsidiaries to permit,
representatives of any Lender (at such Lender's expense prior to the occurrence
of an Event of Default and at the Company's expense after an Event of Default
has occurred and is continuing) to visit and inspect any of their respective
properties, to examine their respective books and records and to discuss their
respective affairs, finances and accounts with their respective officers,
employees and independent public accountants, in each case at such reasonable
times (which shall be, unless an Event of Default has occurred and is
continuing, during business hours, upon reasonable prior notice to the
Administrative Agent, which notice shall be promptly conveyed to the Company)
and as often as may reasonably be desired. The Company agrees to cooperate and
assist in such visits and inspections. Notwithstanding anything to the contrary
contained in this Agreement, no

                                      -54-

Lender shall be entitled to consult with any independent accounting firm of the
Company regarding the Company's or any of its Subsidiary's business without the
prior written consent of the Company

         Section 6.03. Insurance. The Company will maintain, and will cause each
of its Subsidiaries to maintain (either in the name of the Company or in the
Subsidiary's own name) with financially sound and reputable insurance companies,
insurance on all their property in at least such amounts and against at least
such risks as are usually insured against in the same general area by companies
of established repute engaged in the same or similar businesses.

         Section 6.04. Payment of Taxes. The Company will pay and discharge, and
will cause each of its Subsidiaries to pay and discharge, all income taxes and
all other material taxes, assessments and governmental charges or levies imposed
upon it or upon its income or profits, or upon any properties belonging to it,
in each case, on a timely basis prior to the date on which penalties attach
thereto, and all lawful claims which, if unpaid, might become a Lien or charge
upon any properties of the Company or any of its Subsidiaries; provided that
neither the Company nor any Subsidiary of the Company shall be required to pay
any such tax, assessment, charge, levy or claim which is being contested in good
faith and by proper proceedings if it has maintained adequate reserves with
respect thereto in accordance with GAAP.

         Section 6.05. Maintenance of Existence. The Company shall maintain, and
shall cause each of its Subsidiaries to maintain, its existence, provided that
the Company shall not be required to maintain the existence of any of its
Subsidiaries if the Company shall determine in good faith that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
its Subsidiaries taken as a whole. The Company will qualify and remain
qualified, and cause each of its Subsidiaries to qualify and remain qualified,
as a foreign corporation in each jurisdiction where the Company or such
Subsidiary, as the case may be, is required to be qualified, except in those
jurisdictions in which the failure to receive or retain such qualifications
would not reasonably be expected to have, either individually or in the
aggregate, a Material Adverse Effect.

         Section 6.06. Compliance with Statutes, etc. The Company will, and will
cause each Subsidiary to, comply with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property (including applicable statutes, regulations, orders and
restrictions relating to environmental standards and controls) other than those
the non-compliance with which would not reasonably be expected to have, either
individually or in the aggregate, a Material Adverse Effect.

         Section 6.07. ERISA. Promptly after the Company, any of its
Subsidiaries or, in the case of clauses (i) through (v) below, any of its ERISA
Affiliates knows or has reason to know that any of the events or conditions
specified below with respect to any Plan or Multiemployer Plan or Foreign
Pension Plan has occurred or exist, a certificate of an Authorized Officer of
the Company setting forth details respecting such event or condition and the
action if any, that the Company, such Subsidiary or such ERISA Affiliate
proposes to take with respect thereto (and a copy of any report or notice
required to be filed with or given to the PBGC or an applicable foreign
governmental agency by the Company, such Subsidiary or such ERISA Affiliate with
respect to such event or condition):

                                      -55-

         (i) any reportable event, as defined in subsections (c)(1), (2), (5)
    and (6), and subsection (d)(2) of Section 4043 of ERISA and the regulations
    issued thereunder, with respect to a Plan;

         (ii) the filing under Section 4041(c) of ERISA of a notice of intent to
    terminate any Plan under a distress termination or the distress termination
    of any Plan;

         (iii) the institution by the PBGC of proceedings under Section 4042 of
    ERISA for the termination of, or the appointment of a trustee to administer,
    any Plan, or the receipt by the Company, any of its Subsidiaries or any of
    its ERISA Affiliates of a notice from a Multiemployer Plan that such action
    has been taken by the PBGC with respect to such Multiemployer Plan which
    could reasonably be expected to result in a liability to the Company or any
    of its Subsidiaries in excess of $15,000,000;

         (iv) the receipt by the Company, any of its Subsidiaries or any of its
    ERISA Affiliates of notice from a Multiemployer Plan that the Company, any
    of its Subsidiaries or any of its ERISA Affiliates has incurred withdrawal
    liability under Section 4201 of ERISA in excess of $15,000,000 or that such
    Multiemployer Plan is in reorganization or insolvency pursuant to Section
    4241 or 4245 of ERISA or that it intends to terminate or has terminated
    under Section 4041A of ERISA whereby a deficiency or additional assessment
    is levied or threatened to be levied in excess of $15,000,000 against the
    Company, any of its Subsidiaries or any of its ERISA Affiliates;

         (v) the institution of a proceeding by a fiduciary of any Plan or
    Multiemployer Plan against the Company, any of its Subsidiaries or any of
    its ERISA Affiliates to enforce Section 515 or 4219(c)(5) of ERISA asserting
    liability in excess of $15,000,000, which proceeding is not dismissed within
    30 days; and

         (vi) that any material contribution required to be made with respect to
    a Foreign Pension Plan has not been timely made, or that the Company or any
    Subsidiary of the Company may incur any material liability pursuant to any
    Foreign Pension Plan (other than to make contributions in the ordinary
    course of business).

         Section 6.08. Maintenance of Property. The Company shall, and will
cause each of its Subsidiaries to, maintain all of their properties and assets
in good condition, repair and working order, ordinary wear and tear excepted,
except where failure to maintain the same would not reasonably be expected to
have, either individually or in the aggregate, a Material Adverse Effect.

         Section 6.09. Maintenance of Licenses and Permits. The Company will,
and will cause each of its Subsidiaries to, maintain all permits, licenses and
consents as may be required for the conduct of its business by any state,
federal or local government agency or instrumentality, except where failure to
maintain the same would not reasonably be expected to have, either individually
or in the aggregate, a Material Adverse Effect.

         Section 6.10. End of Fiscal Years; Fiscal Quarters. The Company will
cause (i) each of its, and each of its Subsidiaries', fiscal years to end on
December 31 of each year and (ii)

                                      -56-

each of its, and each of its Subsidiaries', fiscal quarters to end on dates
which are consistent with a fiscal year end as described above.

         Section 6.11. Borrowing Base Requirement. Subject to Section 2.08, the
Company and each Designated Subsidiary Borrower shall at all times cause its
respective Borrowing Base to equal or exceed the Revolving Credit Exposure
attributable to such Borrower at such time.

         Section 6.12. Further Assurances. Each Borrower shall promptly and duly
execute and deliver to the Administrative Agent and/or the Collateral Agent such
documents and assurances and take such further action as the Administrative
Agent may from time to time reasonably request in order to carry out more
effectively the intent and purpose of the Credit Documents and to establish,
protect and perfect the rights and remedies created or intended to be created in
favor of the Collateral Agent, the Administrative Agent or the Lenders pursuant
to the Credit Documents.

         Section 6.13. Existing Letters of Credit. The Company and each
Designated Subsidiary Borrower that is an account party under any Fronted Letter
of Credit which is an Existing Letter of Credit, in each case, shall use its
commercially reasonable efforts to amend such Fronted Letter of Credit
(including, without limitation, by obtaining all necessary consents of
beneficiaries in connection therewith) within 30 days of the Effective Date so
that such Fronted Letter of Credit shall satisfy the requirements of a Several
Letter of Credit issued hereunder (it being understood and agreed that each such
Existing Letter of Credit so amended shall in accordance with Article III be
deemed to be a Several Letter of Credit issued hereunder); provided that the
Company and such Designated Subsidiary Borrower shall only be required to use
their commercially reasonable efforts so that after giving effect to such
amendments no more than an aggregate Stated Amount equal to $12,500,000 of such
Fronted Letters of Credit are not so amended as Several Letters of Credit
hereunder.

                                   ARTICLE VII

                               Negative Covenants

                  Until the Total Commitment (and the Commitment of each Lender)
and each Letter of Credit has expired or terminated and all Unpaid Drawings, the
principal of and interest on each Loan and all fees payable hereunder have been
irrevocably paid in full, each of the Company and each Designated Subsidiary
Borrower covenants and agrees with the Lenders that:

Section 7.01. Changes in Business. The Company will not, and will not permit any
of its Subsidiaries to, engage (directly or indirectly) in any business other
than (a) businesses in which they are engaged (or proposed to be engaged as
described in the Company's registration statement on Form S-1 filed with the SEC
on May 11, 2004) as of the Effective Date and reasonable extensions thereof ,
(b) other specialty insurance and structured risk insurance and reinsurance
product lines, and (c) and other businesses that are complementary or reasonably
related thereto and the conduct of business incidental thereto, including
political risk products, financial guaranty products, trade credit risk
products, life surplus relief products, closed block mortality risk products and
life settlement products.

                                      -57-

         Section 7.02. Consolidations, Mergers, Sales of Assets and
Acquisitions. (a) The Company will not, and will not permit any of its
Subsidiaries to, consolidate or merge with or into any other Person; provided
that (i) the Company may merge with another Person, if (x) the Company is the
entity surviving such merger and (y) immediately after giving effect to such
merger, no Default or Event of Default shall have occurred and be continuing,
(ii) any Subsidiary may merge with another Person, if (x) such Subsidiary is the
entity surviving such merger and (y) immediately after giving effect to such
merger, no Default or Event of Default shall have occurred and be continuing,
(iii) Wholly-Owned Subsidiaries of the Company may merge with one another
provided that if one of such Subsidiaries is a Designated Subsidiary Borrower
and the other is not, then the Designated Subsidiary Borrower must be the
surviving entity of such merger and (iv) a Subsidiary (other than a Designated
Subsidiary Borrower) of the Company may merge or consolidate with any other
Person if immediately after giving effect to such merger no Default or Event of
Default shall have occurred and be continuing. In addition, the Company will
not, nor will it permit any of its Subsidiaries to, sell, convey, assign, lease,
abandon or otherwise transfer or dispose of, voluntarily or involuntarily, all
or substantially all of its properties or assets, tangible or intangible, except
(I) such dispositions by the Company or any of its Subsidiaries of any of their
respective properties or assets to the Company or any Wholly-Owned Subsidiary of
the Company, (II) sales, transfers or other dispositions of the assets of any
Subsidiary which in the aggregate do not exceed in any fiscal year of the
Company 5% or more of the lesser of the book or fair market value of the
property and assets of the Company determined on a consolidated basis as of the
last day of the previous fiscal year of the Company and (III) subject to Section
6.05, the dissolution or winding up of any Subsidiary other than a Designated
Subsidiary Borrower.

         (b) The Company will not, nor will it permit any of its Subsidiaries
to, acquire all or substantially all of the capital stock or assets of another
Person unless at such time and immediately after giving effect thereto no
Default or Event of Default exists or would result therefrom.

         Section 7.03. Liens. Neither the Company nor any of its Subsidiaries
will permit, create, assume, incur or suffer to exist any Lien on any asset
tangible or intangible now owned or hereafter acquired by it, except:

         (a) Liens existing on the Effective Date and listed on Schedule 7.03
    hereto;

         (b) Liens securing repurchase agreements constituting a borrowing of
    funds by the Company or any Subsidiary of the Company in the ordinary course
    of business for liquidity purposes and in no event for a period exceeding 90
    days in each case;

         (c) Liens arising pursuant to purchase money mortgages, capital leases
    or security interests securing Indebtedness representing the purchase price
    (or financing of the purchase price within 90 days after the respective
    purchase) of assets acquired by the Company or any of its Subsidiaries;

         (d) Liens on any asset of any Person existing at the time such Person
    is merged or consolidated with or into the Company or any of its
    Subsidiaries or at the time of acquisition of such asset by the Company or
    any of its Subsidiaries and not created in contemplation of such event;

                                      -58-

         (e) Liens securing obligations owed by the Company to any of its
    Subsidiaries or owed by any Subsidiary of the Company to the Company or any
    Subsidiary of the Company, in each case solely to the extent that such Liens
    are required by an Applicable Insurance Regulatory Authority for such Person
    to maintain such obligations;

         (f) Liens securing insurance or reinsurance obligations of Subsidiaries
    of the Company owed by any Subsidiary of the Company to the Company or any
    Subsidiary of the Company, in each case solely to the extent that such Liens
    are required or requested by rating agencies, regulatory agencies, clients
    or brokers for such Person to maintain such insurance obligations;

         (g) Liens on investments and cash balances of any Regulated Insurance
    Company securing obligations of such Regulated Insurance Company in respect
    of trust or similar arrangements formed, letters of credit issued or funds
    withheld balances established, in each case, in the ordinary course of
    business for the benefit of policyholders or cedents to secure insurance or
    reinsurance recoverables owed to them by such Regulated Insurance Company;

         (h) Inchoate Liens for taxes, assessments or governmental charges or
    levies not yet due or Liens for taxes, assessments or governmental charges
    or levies being contested in good faith and by appropriate proceedings for
    which adequate reserves have been established in accordance with GAAP;

         (i) Liens in respect of property or assets of the Company or any of its
    Subsidiaries imposed by law, which were incurred in the ordinary course of
    business and do not secure Indebtedness for borrowed money, such as
    carriers', warehousemen's, materialmen's and mechanics' liens and other
    similar Liens arising in the ordinary course of business, and (x) which do
    not in the aggregate materially detract from the value of the Company's or
    such Subsidiary's property or assets or materially impair the use thereof in
    the operation of the business of the Company or such Subsidiary or (y) which
    are being contested in good faith by appropriate proceedings, which
    proceedings have the effect of preventing the forfeiture or sale of the
    property or assets subject to any such Lien;

         (j) Licenses, sublicenses, leases, or subleases granted to other
    Persons not materially interfering with the conduct of the business of the
    Company or any of its Subsidiaries;

         (k) easements, rights-of-way, restrictions, encroachments and other
    similar charges or encumbrances, and minor title deficiencies, in each case
    not securing Indebtedness and not materially interfering with the conduct of
    the business of the Company or any of its Subsidiaries;

         (l) Liens arising out of the existence of judgments or awards not
    constituting an Event of Default under Section 8.07;

         (m) Liens (other than Liens imposed under ERISA) incurred in the
    ordinary course of business in connection with workers compensation claims,
    unemployment insurance and social security benefits and Liens securing the
    performance of bids,

                                      -59-

    reinsurance obligations, tenders, leases and contracts in the ordinary
    course of business, statutory obligations, surety bonds, performance bonds
    and other obligations of a like nature incurred in the ordinary course of
    business and consistent with past practice (exclusive of obligations in
    respect of the payment for borrowed money);

         (n) Bankers' Liens, rights of setoff and other similar Liens existing
    solely with respect to cash and cash equivalents on deposit in one or more
    accounts maintained by the Company or any of its Subsidiaries, in each case
    granted in the ordinary course of business in favor of the bank or banks
    with which such accounts are maintained;

         (o) Liens arising out of the refinancing, extension, renewal or
    refunding of any Indebtedness secured by any Lien permitted by any of the
    clauses of this Section 7.03, provided that such Indebtedness is not
    increased and is not secured by any additional assets;

         (p) Liens created pursuant to the Credit Documents;

         (q) Liens in respect of property or assets of any Subsidiary of the
    Company securing Indebtedness of the type described in clause (e) or (i) of
    the definition of "Permitted Subsidiary Indebtedness";

         (r) Liens in respect of property or assets of any Subsidiary of the
    Company securing Indebtedness of the type described in clause (h) of the
    definition of "Permitted Subsidiary Indebtedness"; provided that the
    aggregate amount of the Indebtedness secured by such Liens shall not, when
    added to the aggregate amount of all outstanding obligations of the Company
    secured by Liens incurred pursuant to Section 7.03(v), exceed at any time 5%
    of Consolidated Net Worth at the time of incurrence of any new Liens under
    this clause (r);

         (s) Liens on assets received by or of the Company or its Subsidiaries
    and held in trust in respect of, or deposited or segregated to secure,
    liabilities assumed in the course of the reinsurance business or under any
    Insurance Contracts, Reinsurance Agreements, Fronting Arrangements or other
    indemnity arrangements entered in the ordinary course of business;

         (t) Liens on cash and securities securing Indebtedness under, or
    otherwise granted in accordance with the terms of, transactions in Capital
    Markets Products, (i) in the case of the Company, entered into in the
    ordinary course of business of the Company, and (ii) in the case of any
    Subsidiary, of the type described in clause (b) of the definition of
    "Permitted Subsidiary Indebtedness"; provided that the aggregate amount of
    cash and securities pledged under this clause (t) shall not exceed 10% of
    Consolidated Net Worth at the time of incurrence of any Liens under this
    clause (t);

         (u) Liens not securing indebtedness for borrowed money on cash and
    securities arising in the ordinary course of business in connection with the
    structured risk insurance and reinsurance product lines of the Company and
    its Subsidiaries; and

                                      -60-

         (v) in addition to the Liens described in clauses (a) through (u)
    above, Liens securing obligations of the Company; provided that the
    aggregate amount of the obligations secured by such Liens shall not, when
    added to the aggregate amount of outstanding Indebtedness of Subsidiaries
    incurred pursuant to clause (h) of the definition of "Permitted Subsidiary
    Indebtedness", exceed at any time 5% of Consolidated Net Worth at the time
    of incurrence of any new Liens under this clause (v).

         Section 7.04. Indebtedness. (a) The Company will not create, incur,
assume or permit to exist any Indebtedness, or agree, become or remain liable
(contingent or otherwise) to do any of the foregoing, except for the
Indebtedness under the Credit Documents and other Indebtedness which is either
pari passu with, or subordinated in right of payment to, the Loans, (it being
understood that unsecured Indebtedness is not subordinate to secured
Indebtedness solely because it is unsecured, and Indebtedness that is not
guaranteed by a particular Person is not deemed to be subordinate to
Indebtedness that is so guaranteed solely because it is not so guaranteed).

         (b) The Company will not permit any of its Subsidiaries to create,
incur, assume or permit to exist any Indebtedness, or agree, become or remain
liable (contingent or otherwise) to do any of the foregoing, except for the
Indebtedness under the Credit Documents and Permitted Subsidiary Indebtedness.

         Section 7.05. Issuance of Stock. The Company will not, and will not
permit any of its Subsidiaries to, directly or indirectly issue, sell, assign,
pledge, or otherwise encumber or dispose of any shares of its preferred or
preference equity securities or options to acquire preferred or preference
equity securities, except the issuance of preferred or preference equity
securities, so long as (i) (x) no part of such preferred or preference equity
securities is mandatorily redeemable (whether on a scheduled basis or as a
result of the occurrence of any event or circumstance) prior to the date
occurring six months after the Commitment Expiration Date or (y) all such
preferred or preference equity securities or options therefor are issued to and
held by the Company and its Wholly-Owned Subsidiaries and (ii) such preferred or
preference equity securities do not contain any financial performance related
covenants or incurrence covenants which restrict the operations of the issuer
thereof; provided that such preferred or preference securities may contain
financial performance related covenants or incurrence covenants which are no
more restrictive than the terms, provisions and covenants contained herein.

         Section 7.06. Dissolution. The Company shall not suffer or permit
dissolution or liquidation either in whole or in part, except through corporate
reorganization to the extent permitted by Section 7.02.

         Section 7.07. Restricted Payments. The Company will not declare or pay
any dividends, purchase, redeem, retire, defease or otherwise acquire for value
any of its Equity Interests now or hereafter outstanding, return any capital to
its stockholders, partners or members (or the equivalent Persons thereof) as
such, make any distribution of assets, Equity Interests, obligations or
securities to its stockholders, partners or members (or the equivalent Persons
thereof) as such, or permit any of its Subsidiaries to purchase, redeem, retire,
defease or otherwise acquire for value any Equity Interests in the Company or to
sell any Equity Interests

                                      -61-

therein (each of the foregoing a "Dividend" and, collectively, "Dividends")
provided that this Section 7.07 shall not prohibit (a) the purchase, redemption,
retirement, defeasement or other acquisition of Equity Interest of the Company
in connection with the termination of employment of an employee of the Company
or its Subsidiaries, (b) the issuance of Equity Interests in exchange for or
cancellation of any Equity Interests of the Company, (c) the sale or issuance of
any Equity Interests of any Subsidiary to another wholly owned Subsidiary or to
the Company, (d) the issuance to a customer or broker of a Protected Cell
Company of non-voting Equity Interests of such Regulated Insurance Company, (e)
the purchase, redemption, retirement, defeasement or other acquisition of Equity
Interest issued by the Company with the proceeds received from the substantially
concurrent issue of new shares of its common stock or other common Equity
Interests of the Company, (f) the declaration and dividend payments or other
distributions payable solely in the common stock or other common Equity
Interests of the Company and (g) Dividends permitted by Section 7.02.

         Section 7.08. Transactions with Affiliates. Neither the Company nor any
of its Subsidiaries shall enter into or be a party to, a transaction with any
Affiliate of the Company or such Subsidiary (which Affiliate is not the Company
or a Subsidiary), except (i) transactions with Affiliates on terms (x) no less
favorable to the Company or such Subsidiary than those that could have been
obtained in a comparable transaction on an arm's length basis from an unrelated
Person or (y) approved by the audit committee or a majority of the disinterested
members of the board of directors of the Company, (ii) transactions and payments
pursuant to agreements and arrangements disclosed in, or listed as an exhibit
to, the Company's filings with the SEC through the Effective Date or any such
agreement or arrangement as thereafter amended, extended or replaced on terms
that are, in the aggregate, no less favorable to the Company and its
Subsidiaries than the terms of such agreement on the Effective Date, as the case
may be, (iii) Dividends not prohibited by Section 7.07, (iv) fees and
compensation paid to and indemnities provided on behalf of officers and
directors of the Company or any of its Subsidiaries as reasonably determined in
good faith by the board of directors, the audit committee or senior management
of Borrower and (v) the issuance of common stock of the Company.

         Section 7.09. Maximum Leverage Ratio. The Company will not permit the
Leverage Ratio at any time to be greater than 0.35:1.00.

         Section 7.10. Minimum Consolidated Net Worth. The Company will not
permit Consolidated Net Worth at any time to be less than $340,000,000.

         Section 7.11. Limitation on Certain Restrictions on Subsidiaries. The
Company will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
consensual encumbrance or consensual restriction on the ability of any such
Subsidiary to (a) pay dividends or make any other distributions on its capital
stock or any other interest or participation in its profits owned by the Company
or any of its Subsidiaries, or pay any Indebtedness owed to the Company or any
of its Subsidiaries, (b) make loans or advances to the Company or any of its
Subsidiaries or (c) transfer any of its properties or assets to the Company or
any of its Subsidiaries, except for such encumbrances or restrictions existing
under or by reason of (i) applicable Legal Requirements, including any
Applicable Insurance Regulatory Authority, (ii) this Agreement and the other
Credit Documents, (iii) customary provisions restricting subletting or
assignment of any lease

                                      -62-

governing any leasehold interest of the Company or any of its Subsidiaries, (iv)
customary provisions restricting assignment of any licensing agreement (in which
the Company or any of its Subsidiaries is the licensee) or other contract
(including leases) entered into by the Company or any of its Subsidiaries in the
ordinary course of business, (v) restrictions on the transfer of any asset
pending the close of the sale of such asset, (vi) restrictions on the transfer
of any asset subject to a Lien permitted by Section 7.03, (vii) agreements
entered into by a Regulated Insurance Company with an Applicable Insurance
Regulatory Authority, (viii) customary provisions in partnership agreements,
limited liability company organizational governance documents, joint venture
agreements and other similar agreements entered into in the ordinary course of
business that restrict the transfer of ownership interests in such partnership,
limited liability company, joint venture or similar Person, (ix) restrictions on
cash or other deposits or net worth imposed by customers under contracts
(including Insurance Contracts, Fronting Arrangements and Reinsurance
Agreements) entered into in the ordinary course of business, pursuant to an
agreement or instrument relating to any Permitted Subsidiary Indebtedness of the
type described in clause (d) or (g) of the definition thereof (1) if the
encumbrances and restrictions contained in any such agreement or instrument
taken as a whole are not materially less favorable to the Lenders than the
encumbrances and restrictions contained in this Agreement or (2) if such
encumbrance or restriction is not materially more disadvantageous to the Lenders
than is customary in comparable financings and such encumbrance or restriction
will not materially affect the Company's ability to make principal or interest
payments on the Loans, (x) any encumbrances or restrictions imposed by any
amendments or refinancings of the contracts, instruments or obligations referred
to in clause (ix) above provided that such amendments or refinancings are no
more materially restrictive with respect to such encumbrances and restrictions
that those prior to such amendment or refinancing and (xi) restrictions placed
in accordance with the Segregated Account Companies Act 2000 of Bermuda on the
transfer of any asset held, carried or deposited in a segregated account of a
Protected Cell Company.

         Section 7.12. Private Act. No Borrower will become subject to a Private
Act.

         Section 7.13. Claims Paying Ratings. The Company shall not permit at
any time the financial strength rating of any Regulated Insurance Company which
has a rating in effect at any time on or after the Closing Date to be less than
"B++" from A.M. Best & Co. (or its successor).

                                  ARTICLE VIII

                                Events of Default

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

         Section 8.01. Payments. Any Borrower shall (a) default in the payment
when due of any Unpaid Drawing or any principal of any Loan, (b) default, and
such default shall continue for three or more Business Days, in the payment when
due of any interest on any Loan or any Unpaid Drawing, (c) default, and such
default shall continue for five or more Business Days, in the payment when due
of any or any fees or any other amounts payable hereunder or pursuant to any
other Credit Documents; or

                                      -63-

         Section 8.02. Representations, etc. Any representation, warranty or
statement made (or deemed made) by any Borrower herein or in any other Credit
Document or in any certificate or statement delivered or required to be
delivered pursuant hereto or thereto shall prove to be untrue in any material
respect on the date as of which made or deemed made; or

         Section 8.03. Covenants. Any Borrower shall (a) default in the due
performance or observance by it of any term, covenant or agreement contained in
Section 6.01(d), 6.02(ii), 6.05 (but only with respect to the first sentence
thereof), 6.11 or Article VII, or (b) default in the due performance or
observance by it of any term, covenant or agreement (other than those referred
to in Section 8.01 or clause (a) of this Section 8.03) contained in this
Agreement and such default shall continue unremedied for a period of 30 days
after written notice to the Company from the Administrative Agent or the
Required Lenders; or

         Section 8.04. Default under other Agreements. (a) The Company or any of
its Subsidiaries shall (i) default in any payment with respect to Indebtedness
(other than the Loans) in excess of $25,000,000 individually or in the
aggregate, for the Company and its Subsidiaries, beyond the period of grace, if
any, provided in the instrument or agreement under which such Indebtedness was
created or (ii) default in the observance or performance of any agreement or
condition relating to any such Indebtedness 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 a trustee or agent on behalf of such holder or holders) to cause (determined
without regard to whether any notice of acceleration, or any lapse of time prior
to the effectiveness of any notice of acceleration, is required), any such
Indebtedness to become due prior to its stated maturity; or (b) Indebtedness of
the Company or its Subsidiaries in excess of $25,000,000 shall be declared to be
due and payable or required to be prepaid, other than by a regularly scheduled
required prepayment or as a mandatory prepayment (unless such required
prepayment or mandatory prepayment results from a default thereunder or an event
of the type that constitutes an Event of Default), prior to the stated maturity
thereof; or

         Section 8.05. Bankruptcy, etc. The Company or any of its Subsidiaries
shall commence a voluntary case concerning itself under Title 11 of the United
States Code entitled "Bankruptcy," as now or hereafter in effect, or any
successor thereto (the "Bankruptcy Code"); or an involuntary case is commenced
against the Company or any of its Subsidiaries and the petition is not
controverted within 10 days, or is not dismissed within 60 days, after
commencement of the case; or a custodian (as defined in the Bankruptcy Code) is
appointed for, or takes charge of, all or substantially all of the property of
the Company or any of its Subsidiaries or the Company or any of its Subsidiaries
commences (including by way of applying for or consenting to the appointment of,
or the taking of possession by, a rehabilitator, receiver, custodian, trustee,
conservator or liquidator (collectively, a "conservator") of itself or all or
any substantial portion of its property) any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency, liquidation, rehabilitation, supervision, conservatorship or similar
law of any jurisdiction or the Bermuda Companies Law whether now or hereafter in
effect relating to the Company or any of its Subsidiaries; or any such
proceeding is commenced against (a) any Regulated Insurance Company which is
engaged in the business of underwriting insurance and/or reinsurance, or (b) the
Company or any of its Subsidiaries, and in the case of either clause (a) or (b)
such proceeding

                                      -64-

is not controverted within 10 days, or is not dismissed within 60 days; or the
Company or any of its Subsidiaries is adjudicated insolvent or bankrupt; or any
order of relief or other order approving any such case or proceeding is entered;
or (x) any Regulated Insurance Company which is engaged in the business of
underwriting insurance and/or reinsurance suffers any appointment of any
conservator or the like for it or any substantial part of its property, or (y)
the Company or any of its Subsidiaries suffers any appointment of any
conservator or the like for it or any substantial part of its property which
continues undischarged or unstayed for a period of 60 days; or the Company or
any of its Subsidiaries makes a general assignment for the benefit of creditors;
or any corporate action is taken by the Company or any of its Subsidiaries for
the purpose of effecting any of the foregoing; or

         Section 8.06. ERISA. (i) An event or condition specified in Section
6.07 shall occur or exist with respect to any Plan or Multiemployer Plan or
Foreign Pension Plan, (ii) the Company, any of its Subsidiaries or any of its
ERISA Affiliates shall fail to pay when due any amount which they shall have
become liable to pay to the PBGC or to a Plan or a Multiemployer Plan under
Title IV of ERISA, or (iii) a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any Plan must be
terminated, and as a result of such event, failure or condition, together with
all such other events, failures or conditions, the Company, any of its
Subsidiaries or any of its ERISA Affiliates shall be reasonably likely to incur
a liability to a Plan, a Multiemployer Plan, a Foreign Pension Plan or PBGC (or
any combination of the foregoing) in an aggregate amount of $25,000,000 or more;
or

         Section 8.07. Judgments. One or more judgments or decrees shall be
entered against the Company or any of its Subsidiaries involving a liability,
net of undisputed insurance and reinsurance, of $25,000,000 or more in the case
of any one such judgment or decree or in the aggregate for all such judgments
and decrees for the Company and its Subsidiaries and any such judgments or
decrees shall not have been vacated, discharged, satisfied, stayed or bonded
pending appeal within 60 days from the entry thereof; or

         Section 8.08. Insurance Licenses. Any one or more Insurance Licenses of
the Company or any of its Subsidiaries shall be suspended, limited or terminated
or shall not be renewed, or any other action shall be taken by any Governmental
Authority, and such suspension, limitation, termination or non-renewal could
reasonably be expected to have, either individually or in the aggregate, a
Material Adverse Effect; or

         Section 8.09. Change of Control. A Change of Control shall occur; or

         Section 8.10. Security Documents. Any Security Document shall cease to
be in full force and effect, or shall cease to give the Collateral Agent the
Liens, rights, powers and privileges purported to be created thereby (including,
without limitation, a first priority security interest in, and Lien on, all of
the Collateral subject thereto, in favor of the Collateral Agent, superior to
and prior to the rights of all third Persons and subject to no other Liens); or
any Borrower or any other pledgor thereunder shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any Security Document; or

         Section 8.11. Company Guaranty. The Company Guaranty or any provision
thereof shall cease to be in full force or effect, or any Person acting by or on
behalf of the

                                      -65-

Company shall deny or disaffirm the Company's obligations under the Company
Guaranty, or the Company shall default in the due performance or observance of
any term, covenant or agreement on its part to be performed or observed pursuant
to the Company Guaranty;

then, and in any such event, and at any time thereafter, if an Event of Default
shall then be continuing, the Administrative Agent shall, upon the written
request of the Required Lenders, by written notice to the Company, take any or
all of the following actions, without prejudice to the rights of the
Administrative Agent or any Lender to enforce its claims against any Borrower,
except as otherwise specifically provided for in this Agreement (provided that
if an Event of Default specified in Section 8.05 shall occur with respect to the
Company, the result which would occur upon the giving of written notice by the
Administrative Agent as specified in clauses (i), (ii) and (iv) below shall
occur automatically without the giving of any such notice): (i) declare the
Total Commitment terminated, whereupon the Commitment of each Lender shall
forthwith terminate immediately; (ii) declare the principal of and any accrued
interest and fees in respect of all obligations owing hereunder and under the
other Credit Documents to be, whereupon the same shall become, forthwith due and
payable without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by each Borrower; (iii) terminate any Letter of Credit
which may be terminated in accordance with its terms; (iv) direct each Borrower
to pay to the Collateral Account maintained by the Collateral Agent such
additional amounts of cash, to be held as security for such Borrower's
reimbursement obligations in respect of Letters of Credit then outstanding,
equal to the aggregate Revolving Credit Exposure attributable to such Borrower;
and/or (v) enforce, as Collateral Agent (or direct the Collateral Agent to
enforce), any or all of the Liens and security interests created pursuant to the
Security Documents and/or exercise any of the rights and remedies provided
therein. In addition, upon the occurrence and during the continuation of an
Event of Default, each Borrower hereby appoints the Administrative Agent (acting
on the instructions of the Required Lenders) as the attorney-in-fact of such
Borrower, with full power of substitution, and in the name of such Borrower, to
disburse and directly apply the proceeds of its Collateral Accounts to the
satisfaction of any of such Borrower's obligations hereunder or under any other
Credit Document. The power-of-attorney granted hereby is a power coupled with an
interest and is irrevocable. Unless directed to do so by the Required Lenders in
accordance with the terms of this Agreement and the other Credit Documents, the
Administrative Agent shall have no obligation to undertake any of the foregoing
actions, and, if it takes any such action it shall have no liability to any
Borrower to continue the same or for the sufficiency or adequacy thereof. At the
request of the Administrative Agent, each Borrower shall ratify all actions
taken by the Administrative Agent hereunder.

                                   ARTICLE IX

                            The Administrative Agent

         Section 9.01. Appointment. Each of the Lenders hereby irrevocably
appoints the Administrative Agent as its agent and authorizes the Administrative
Agent to take such actions on its behalf and to exercise such powers as are
delegated to the Administrative Agent by the terms hereof, together with such
actions and powers as are reasonably incidental thereto. As used in this Article
IX, the term "Administrative Agent" shall include JP Morgan Chase Bank in its
capacity as Collateral Agent under the Security Documents.

                                      -66-

         Section 9.02. Administrative Agent in its Individual Capacity. The bank
serving as the Administrative Agent hereunder shall have the same rights and
powers in its capacity as a Lender as any other Lender and may exercise the same
as though it were not the Administrative Agent, and such bank and its Affiliates
may accept deposits from, lend money to and generally engage in any kind of
business with the Company or any Subsidiary or other Affiliate thereof as if it
were not the Administrative Agent hereunder.

         Section 9.03. Exculpatory Provisions. The Administrative Agent shall
not have any duties or obligations except those expressly set forth herein.
Without limiting the generality of the foregoing, (a) the Administrative Agent
shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default has occurred and is continuing, (b) the Administrative Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby that the Administrative Agent is required to exercise in
writing as directed by the Required Lenders (or such other number or percentage
of the Lenders as shall be necessary under the circumstances as provided in
Section 11.02), and (c) except as expressly set forth herein, the Administrative
Agent shall not have any duty to disclose, and shall not be liable for the
failure to disclose, any information relating to the Company or any of its
Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The
Administrative Agent shall not be liable for any action taken or not taken by it
with the consent or at the request of the Required Lenders (or such other number
or percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 11.02) or in the absence of its own gross negligence or
willful misconduct. The Administrative Agent shall be deemed not to have
knowledge of any Default unless and until written notice thereof is given to the
Administrative Agent by the Company or the applicable Borrower or a Lender, and
the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in
or in connection with this Agreement, (ii) the contents of any certificate,
report or other document delivered hereunder or in connection herewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth herein, (iv) the validity, enforceability, effectiveness
or genuineness of this Agreement or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article V or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Administrative Agent.

         Section 9.04. Reliance. The Administrative Agent shall be entitled to
rely upon, and shall not incur any liability for relying upon, any notice,
request, certificate, consent, statement, instrument, document or other writing
believed by it to be genuine and to have been signed or sent by the proper
Person. The Administrative Agent also may rely upon any statement made to it
orally or by telephone and believed by it to be made by the proper Person, and
shall not incur any liability for relying thereon. The Administrative Agent may
consult with legal counsel (who may be counsel for the Company), independent
accountants and other experts selected by it, and shall not be liable for any
action taken or not taken by it in accordance with the advice of any such
counsel, accountants or experts.

         Section 9.05. Delegation of Duties. The Administrative Agent may
perform any and all its duties and exercise its rights and powers by or through
any one or more sub-agents appointed by the Administrative Agent. The
Administrative Agent and any such sub-agent may

                                      -67-

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

         Section 9.06. Resignation. Subject to the appointment and acceptance of
a successor Administrative Agent as provided in this paragraph, the
Administrative Agent may resign at any time by notifying the Lenders and the
Company. Upon any such resignation, the Required Lenders shall have the right to
appoint a successor administrative agent with the consent of the Company (not to
be unreasonably withheld or delayed), provided that no such consent shall be
required at any time when a Default or Event of Default exists. If no successor
shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent gives
notice of its resignation, then the retiring Administrative Agent may, on behalf
of the Lenders, appoint a successor Administrative Agent which shall be a bank
with an office in New York, New York, or an Affiliate of any such bank. Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor,
such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. The fees payable by the Borrowers to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Company and such successor. After the Administrative Agent's
resignation hereunder, the provisions of this Article and Section 11.03 shall
continue in effect for the benefit of such retiring Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while it was acting as Administrative
Agent.

         Section 9.07. Non-Reliance. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its
own decisions in taking or not taking action under or based upon this Agreement,
any related agreement or any document furnished hereunder or thereunder.

         Section 9.08. Co-Syndication Agents. Notwithstanding any other
provision of this Agreement or any provision of any other Credit Document, the
Co-Syndication Agents are named as such for recognition purposes only, and in
its capacity as such shall have no powers, duties, responsibilities or
liabilities with respect to this Agreement or the other Credit Documents or the
transactions contemplated hereby and thereby. Without limitation of the
foregoing, the Co-Syndication Agents shall not, solely by reason of this
Agreement or any other Credit Documents, have any fiduciary relationship with
any Lender or any other Person.

                                      -68-

                                    ARTICLE X

                                Company Guaranty

         Section 10.01. The Company Guaranty. In order to induce the Lenders to
enter into this Agreement and to extend credit hereunder and in recognition of
the direct benefits to be received by the Company from the proceeds of the Loans
and the issuance of the Letters of Credit, the Company hereby agrees with the
Lenders as follows: the Company hereby unconditionally and irrevocably
guarantees, as primary obligor and not merely as surety, the full and prompt
payment when due, whether upon maturity, acceleration or otherwise, of any and
all of the Guaranteed Obligations of each Designated Subsidiary Borrower to the
Guaranteed Creditors. If any or all of the Guaranteed Obligations of any
Designated Subsidiary Borrower to the Guaranteed Creditors becomes due and
payable hereunder, the Company unconditionally promises to pay such indebtedness
to the Guaranteed Creditors, or order, on demand, together with any and all
expenses which may be incurred by the Guaranteed Creditors in collecting any of
the Guaranteed Obligations. This Company Guaranty is a guaranty of payment and
not of collection. If a claim is ever made upon any Guaranteed Creditor for
repayment or recovery of any amount or amounts received in payment or on account
of any of the Guaranteed Obligations and any of the aforesaid payees repays all
or part of said amount by reason of (i) any judgment, decree or order of any
court or administrative body having jurisdiction over such payee or any of its
property or (ii) any settlement or compromise of any such claim effected by such
payee with any such claimant, then and in such event the Company agrees that any
such judgment, decree, order, settlement or compromise shall be binding upon the
Company, notwithstanding any revocation of this Company Guaranty or any other
instrument evidencing any liability of each Designated Subsidiary Borrower, and
the Company shall be and remain liable to the aforesaid payees hereunder for the
amount so repaid or recovered to the same extent as if such amount had never
originally been received by any such payee.

         Section 10.02. Bankruptcy. Additionally, the Company unconditionally
and irrevocably guarantees the payment of any and all of the Guaranteed
Obligations of each Designated Subsidiary Borrower hereunder to the Guaranteed
Creditors whether or not due or payable by each Designated Subsidiary Borrower
upon the occurrence of any of the events specified in Section 8.05 with respect
to such Designated Subsidiary Borrower, and unconditionally promises to pay such
indebtedness to the Guaranteed Creditors, or order, on demand, in lawful money
of the United States.

         Section 10.03. Nature of Liability. The liability of the Company
hereunder is exclusive and independent of any security for or other guaranty of
the Guaranteed Obligations of each Designated Subsidiary Borrower whether
executed by the Company, any other guarantor or by any other party, and the
liability of the Company hereunder is not affected or impaired by (a) any
direction as to application of payment by each Designated Subsidiary Borrower or
by any other party (other than a direction by the Guaranteed Creditor receiving
such payment), or (b) any other continuing or other guaranty, undertaking or
maximum liability of a guarantor or of any other party as to the Guaranteed
Obligations of each Designated Subsidiary Borrower, or (c) any payment on or in
reduction of any such other guaranty or undertaking, or (d) any dissolution,
termination or increase, decrease or change in personnel by each Designated
Subsidiary Borrower, or (e) any payment made to the Guaranteed Creditors on the
Guaranteed Obligations

                                      -69-

which any such Guaranteed Creditor repays to each Designated Subsidiary Borrower
pursuant to court order in any bankruptcy, reorganization, arrangement,
moratorium or other debtor relief proceeding, and the Company waives any right
to the deferral or modification of its obligations hereunder by reason of any
such proceeding or (f) any action or inaction of the type described in Section
10.05.

         Section 10.04. Independent Obligation. The obligations of the Company
under this Article X are independent of the obligations of any other guarantor,
any other party or each Designated Subsidiary Borrower, and a separate action or
actions may be brought and prosecuted against the Company whether or not action
is brought against any other guarantor, any other party or each Designated
Subsidiary Borrower and whether or not any other guarantor, any other party or
each Designated Subsidiary Borrower be joined in any such action or actions. The
Company waives, to the full extent permitted by law, the benefit of any statute
of limitations affecting its liability under this Article X or the enforcement
thereof. Any payment by a Designated Subsidiary Borrower or other circumstance
which operates to toll any statute of limitations as to a Designated Subsidiary
Borrower shall operate to toll the statute of limitations as to the Company.

         Section 10.05. Authorization. The obligations of the Company under this
Article X shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by any action taken by any Guaranteed Creditor to:

         (a) change the manner, place or terms of payment of, and/or change or
    extend the time of payment of, renew, increase, accelerate or alter, any of
    the Guaranteed Obligations (including any increase or decrease in the rate
    of interest thereon), any security therefor, or any liability incurred
    directly or indirectly in respect thereof, and the guaranty herein made
    shall apply to the Guaranteed Obligations as so changed, extended, renewed
    or altered;

         (b) take and hold security for the payment of the Guaranteed
    Obligations and sell, exchange, release, impair, surrender, realize upon or
    otherwise deal with in any manner and in any order any property by
    whomsoever at any time pledged or mortgaged to secure, or howsoever
    securing, the Guaranteed Obligations or any liabilities (including any of
    those hereunder) incurred directly or indirectly in respect thereof or
    hereof, and/or any offset thereagainst;

         (c) exercise or refrain from exercising any rights against any
    Designated Subsidiary Borrower or others or otherwise act or refrain from
    acting;

         (d) release or substitute any one or more endorsers, guarantors, any
    Designated Subsidiary Borrower or other obligor;

         (e) settle or compromise any of the Guaranteed Obligations, any
    security therefor or any liability (including any of those hereunder)
    incurred directly or indirectly in respect thereof or hereof, and may
    subordinate the payment of all or any part thereof to the payment of any
    liability (whether due or not) of any Designated Subsidiary Borrower to its
    creditors other than the Guaranteed Creditors;

                                      -70-

         (f) apply any sums by whomsoever paid or howsoever realized to any
    liability or liabilities of any Designated Subsidiary Borrower to the
    Guaranteed Creditors regardless of what liability or liabilities of any
    Designated Subsidiary Borrower remain unpaid;

         (g) consent to or waive any breach of, or any act, omission or default
    under, this Agreement or any other Credit Document or any of the instruments
    or agreements referred to herein or therein, or otherwise amend, modify or
    supplement this Agreement, any other Credit Document or any of such other
    instruments or agreements; and/or

         (h) take any other action which would, under otherwise applicable
    principles of common law, give rise to a legal or equitable discharge of the
    Company from its liabilities under this Company Guaranty.

         Section 10.06. Reliance. It is not necessary for the Guaranteed
Creditors to inquire into the capacity or powers of any Designated Subsidiary
Borrower or the officers, directors, partners or agents acting or purporting to
act on their behalf, and any Guaranteed Obligations made or created in reliance
upon the professed exercise of such powers shall be guaranteed hereunder.

         Section 10.07. Subordination. Any indebtedness of any Designated
Subsidiary Borrower now or hereafter owing to the Company is hereby subordinated
to the Guaranteed Obligations of each Designated Subsidiary Borrower owing to
the Guaranteed Creditors; and if the Administrative Agent so requests at a time
when an Event of Default exists, no Designated Subsidiary Borrower shall make,
or be permitted to make, any payment to the Company in respect of such
indebtedness owed to the Company, but without affecting or impairing in any
manner the liability of the Company under the other provisions of this Company
Guaranty. Prior to the transfer by the Company of any note or negotiable
instrument evidencing any of the indebtedness of any Designated Subsidiary
Borrower to the Company, the Company shall mark such note or negotiable
instrument with a legend that the same is subject to this subordination. Without
limiting the generality of the foregoing, the Company hereby agrees with the
Guaranteed Creditors that it will not exercise any right of subrogation which it
may at any time otherwise have as a result of this Company Guaranty (whether
contractual, under Section 509 of the Bankruptcy Code or otherwise) until all
Guaranteed Obligations have been irrevocably paid in full in cash.

         Section 10.08. Waiver. (a) The Company waives any right (except as
shall be required by applicable statute and cannot be waived) to require any
Guaranteed Creditor to (i) proceed against any Designated Subsidiary Borrower,
any other guarantor or any other party, (ii) proceed against or exhaust any
security held from any Designated Subsidiary Borrower, any other guarantor or
any other party or (iii) pursue any other remedy in any Guaranteed Creditor's
power whatsoever. The Company waives any defense based on or arising out of any
defense of any Designated Subsidiary Borrower, any other guarantor or any other
party, other than payment in full of the Guaranteed Obligations, based on or
arising out of the disability of any Designated Subsidiary Borrower, any other
guarantor or any other party, or the unenforceability of the Guaranteed
Obligations or any part thereof from any cause, or the cessation from any cause
of the liability of any Designated Subsidiary Borrower other than payment in
full of the Guaranteed Obligations. The Guaranteed Creditors may, at their
election, foreclose on any security held by

                                      -71-

the Administrative Agent or any other Guaranteed Creditor by one or more
judicial or non-judicial sales, whether or not every aspect of any such sale is
commercially reasonable (to the extent such sale is permitted by applicable
law), or exercise any other right or remedy the Guaranteed Creditors may have
against any Designated Subsidiary Borrower or any other party, or any security,
without affecting or impairing in any way the liability of the Company hereunder
except to the extent the Guaranteed Obligations have been paid. The Company
waives any defense arising out of any such election by the Guaranteed Creditors,
even though such election operates to impair or extinguish any right of
reimbursement or subrogation or other right or remedy of the Company against any
Designated Subsidiary Borrower or any other party or any security.

         (b) The Company waives all presentments, demands for performance,
protests and notices, including, without limitation, notices of non-performance,
notices of protest, notices of dishonor, notices of acceptance of this Company
Guaranty, and notices of the existence, creation or incurring of new or
additional Guaranteed Obligations. The Company assumes all responsibility for
being and keeping itself informed of each Designated Subsidiary Borrower's
financial condition and assets, and of all other circumstances bearing upon the
risk of non-payment of the Guaranteed Obligations and the nature, scope and
extent of the risks which the Company assumes and incurs hereunder, and agrees
that the Guaranteed Creditors shall have no duty to advise the Company of
information known to them regarding such circumstances or risks.

         (c) The Company warrants and agrees that each of the waivers set forth
above in this Section 10.08 is made with full knowledge of its significance and
consequences, and such waivers shall be effective to the maximum extent
permitted by law.

                                   ARTICLE XI

                                  Miscellaneous

         Section 11.01. Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone (and subject to
paragraph (b) below), all notices and other communications provided for herein
shall be in writing and shall be delivered by hand or overnight courier service,
mailed by certified or registered mail or sent by facsimile, as follows:

         (i) if to the Company, (x) to it at Quanta Capital Holdings Ltd.,
    Cumberland House, 1 Victoria Street, Hamilton HM 11, Bermuda, Attention:
    Controller (Facsimile: (441) 294-6390) and (y) with a copy to it at Quanta
    Capital Holdings Ltd., Cumberland House, 1 Victoria Street, Hamilton HM 11,
    Bermuda, Attention: General Counsel (Facsimile: (441) 294-6390;

         (ii) if to a Designated Subsidiary Borrower, at the address specified
    opposite its signature below;

         (iii) if to the Administrative Agent, to JPMorgan Chase Bank, Loan and
    Agency Services Group, 1111 Fanin Street, Houston, Texas 77002, Attention of
    Melissa

                                      -72-

    Rivas (Facsimile No. (713) 750-2223), with a copy to JPMorgan Chase Bank,
    270 Park Avenue, Fourth Floor, New York 10017, Attention of Heather
    Lindstrom (Facsimile No. (212) 270-1511); and

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

         (b) Notices and other communications to the Lenders hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to (x) Articles II and III unless otherwise agreed by
the Administrative Agent and the applicable Lender or (y) Section 6.01(d)(x).
The Administrative Agent or the Company may, in its discretion, agree to accept
notices and other communications to it hereunder by electronic communications
pursuant to procedures approved by it; provided that approval of such procedures
may be limited to particular notices or communications.

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

         Section 11.02. Waivers; Amendments. (a) No failure or delay by the
Administrative Agent or any Lender in exercising any right or power hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or
the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders hereunder are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision of this Agreement or consent to any departure by any Borrower
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section 11.02, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the issuance of any Letter of
Credit or the making of any Loan shall not be construed as a waiver of any
Default, regardless of whether the Administrative Agent or any Lender may have
had notice or knowledge of such Default at the time. In the case of any waiver,
each Borrower, the Administrative Agent and the Lenders shall be restored to
their former positions and rights hereunder and any Default or Event of Default
so 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.

         (b) Neither this Agreement, any other Credit Document nor any provision
hereof or thereof may be waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by each Borrower and the
Required Lenders or by each Borrower and the Administrative Agent with the
consent of the Required Lenders; provided that no such agreement shall (i)
increase the Commitment or the Revolving Credit Exposure of any Lender without
the written consent of such Lender, (ii) reduce the amount of any amount due
under any Loan or pursuant to any Letter of Credit or reduce any interest or
fees payable hereunder, without the written consent of each Lender affected
thereby, (iii) postpone the scheduled date for payment of any Loan or
reimbursement of any Unpaid Drawing, or any interest thereon, or any

                                      -73-

fees payable hereunder, or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date of expiration of the Commitments,
without the written consent of each Lender affected thereby, (iv) change Section
2.15(b) or (c) in a manner that would alter the pro rata sharing of payments
required thereby or change any of the provisions of this Section 11.02 or the
definition of "Required Lenders" or any other provision hereof specifying the
number or percentage of Lenders required to waive, amend or modify any rights
hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender, (v) release all or substantially all of the
Collateral (except as expressly provided in the Credit Documents) under all the
Security Documents or release the Company from the Company Guaranty, without the
written consent of each Lender or (vi) change any provision of Article III
without the written consent of each LC Issuer affected thereby; and provided,
further, that no such agreement shall amend, modify or otherwise affect the
rights or duties of the Administrative Agent or any LC Issuer hereunder without
the prior written consent of the Administrative Agent or such LC Issuer, as the
case may be.

         Section 11.03. Expenses; Indemnity; Damage Waiver. (a) Each Specified
Obligor jointly and severally agrees to pay (i) all reasonable out-of-pocket
expenses incurred by the Administrative Agent and its Affiliates, including the
reasonable fees, charges and disbursements of one counsel for the Administrative
Agent, in connection with the syndication of the credit facility provided for
herein, the preparation and administration of this Agreement or any amendments,
modifications or waivers of the provisions hereof (whether or not the
transactions contemplated hereby or thereby shall be consummated), and (ii) all
out-of-pocket expenses incurred by the Administrative Agent, or any Lender,
including the fees, charges and disbursements of any counsel for the
Administrative Agent, or any Lender, in connection with the enforcement or
protection of its rights in connection with this Agreement or the other Credit
Documents, including its rights under this Section, or in connection with the
Loans made hereunder, including all such out-of-pocket expenses incurred during
any workout, restructuring or negotiations in respect of such Loans.

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

                                      -74-

gross negligence or willful misconduct of such Indemnitee or any Related Party
of such Indemnitee.

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

         (d) To the extent permitted by applicable law, no Borrower shall
assert, and each Borrower hereby waives, any claim against any Indemnitee, on
any theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in connection
with, or as a result of, this Agreement or any agreement or instrument
contemplated hereby, any Loan or the use of the proceeds thereof.

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

         Section 11.04. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby except that (i) no
Borrower may assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by such Borrower without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section. Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby, Participants (to the extent provided in paragraph (c) of this
Section) and, to the extent expressly contemplated hereby, the Related Parties
of each of the Administrative Agent, and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

         (b) (i) Subject to the conditions set forth in paragraph (b)(ii) below,
any Lender may assign to one or more banks, investment funds or other
institutions that make or hold commercial loans in the ordinary course of their
businesses all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Commitment and the Loans at the time owing to
it) with the prior written consent (such consent not to be unreasonably
withheld) of:

              (A) the Company, provided that no consent of the Company shall be
         required for an assignment to a Lender, an Affiliate of a Lender, an
         Approved Fund or, if an Event of Default has occurred and is
         continuing, any other assignee; and

              (B) the Administrative Agent and each LC Issuer.

         (ii) Assignments shall be subject to the following additional
    conditions:

                                      -75-

              (A) except in the case of an assignment to a Lender or an
         Affiliate of a Lender or an assignment of the entire remaining amount
         of the assigning Lender's Commitment or Loans, the amount of the
         Commitment or Loans of the assigning Lender subject to each such
         assignment (determined as of the date the Assignment and Assumption
         with respect to such assignment is delivered to the Administrative
         Agent) shall not be less than $5,000,000 unless each of the Company and
         the Administrative Agent otherwise consent, provided that no such
         consent of the Company shall be required if an Event of Default has
         occurred and is continuing;

              (B) each partial assignment shall be made as an assignment of a
         proportionate part of all the assigning Lender's rights and obligations
         under this Agreement;

              (C) the parties to each assignment shall execute and deliver to
         the Administrative Agent an Assignment and Assumption, together with a
         processing and recordation fee of $3,500;

              (D) the assignee, if it shall not be a Lender, shall deliver to
         the Administrative Agent an Administrative Questionnaire;

              (E) the assignee shall be an NAIC Approved Bank that is not either
         (x) a foreign branch office of a bank or trust company organized and
         existing in the United States or (y) a parent, subsidiary or affiliate
         of any Borrower or any beneficiary under any Letter of Credit; and

              (F) if any Several Letters of Credit are then outstanding, no such
         assignment shall be effective until all such outstanding Several
         Letters of Credit are either amended or returned and reissued, in each
         case to give effect to such assignment.

         For the purposes of this Section 11.04(b), the term "Approved Fund" has
the following meaning:

         "Approved Fund" means any Person (other than a natural person) that is
    engaged in making, purchasing, holding or investing in bank loans and
    similar extensions of credit in the ordinary course of its business and that
    is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or
    (c) an entity or an Affiliate of an entity that administers or manages a
    Lender.

         (iii) Subject to acceptance and recording thereof pursuant to paragraph
    (b)(iv) of this Section, from and after the effective date specified in each
    Assignment and Assumption the assignee thereunder shall be a party hereto
    and, to the extent of the interest assigned by such Assignment and
    Assumption, have the rights and obligations of a Lender under this Agreement
    (provided that any liability of any Borrower to such assignee under Section
    2.12, 2.13 or 2.14 shall be limited to the amount, if any, that would have
    been payable thereunder by such Borrower in the absence of such assignment,
    except to the extent any such amounts are attributable to a Change in Law),

                                      -76-

    and the assigning Lender thereunder shall, to the extent of the interest
    assigned by such Assignment and Assumption, be released from its obligations
    under this Agreement (and, in the case of an Assignment and Assumption
    covering all of the assigning Lender's rights and obligations under this
    Agreement, such Lender shall cease to be a party hereto but shall continue
    to be entitled to the benefits of Sections 2.12, 2.13, 2.14 and 11.03). Any
    assignment or transfer by a Lender of rights or obligations under this
    Agreement that does not comply with this Section 11.04 shall be treated for
    purposes of this Agreement as a sale by such Lender of a participation in
    such rights and obligations in accordance with paragraph (c) of this
    Section.

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

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

         (c) (i) Any Lender may, without the consent of any Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a "Participant") in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
and Unpaid Drawings owing to it); provided that (A) such Lender's obligations
under this Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrowers, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
modification or waiver described in the first proviso to Section 11.02(b) that
affects such Participant. Subject to paragraph (c)(ii) of this Section, each
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.12, 2.13 and 2.14 to the same extent as if it were a Lender and had
acquired its interest by

                                      -77-

assignment pursuant to paragraph (b) of this Section. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 11.08 as
though it were a Lender, provided such Participant agrees to be subject to
Section 2.15(c) as though it were a Lender.

         (ii) A Participant shall not be entitled to receive any greater payment
under Section 2.12 or 2.14 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Company's
prior written consent and the entitlement to greater payment results solely from
a Change in Law. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 2.14 unless the Company
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrowers, to comply with Section 2.14(e) as
though it were a Lender.

         (d) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

         (e) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle (an,
"SPC") of such Granting Lender, identified as such in writing from time to time
by the Granting Lender to the Administrative Agent and the Company, the option
to provide to the applicable Borrower all or any part of any Loan that such
Granting Lender would otherwise be obligated to make to such Borrower pursuant
to Section 2.01, provided that (i) nothing herein shall constitute a commitment
to make any Loan by any SPC and (ii) if an SPC elects not to exercise such
option or otherwise fails to provide all or any part of such Loan, the Granting
Lender shall be obligated to make such Loan pursuant to the terms hereof. The
making of a Loan by an SPC hereunder shall utilize the Commitment of the
Granting Lender to the same extent, and as if, such Loan were made by the
Granting Lender. Each party hereto hereby agrees that (x) no SPC shall be liable
for any payment under this Agreement for which a Lender would otherwise be
liable and (y) the Granting Lender for any SPC shall be (and hereby agrees that
it is) liable for any payment under this Agreement for which the SPC would be
liable in the absence of preceding clause (x). In furtherance of the foregoing,
each party hereto hereby agrees that, prior to the date that is one year and one
day after the payment in full of all outstanding senior indebtedness of any SPC,
it will not institute against, or join any other person in instituting against,
such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or similar proceedings under the laws of the United States or any
State thereof. In addition, notwithstanding anything to the contrary contained
in this Section 11.04 any SPC may (i) with notice to, but without the prior
written consent of, the Company or the Administrative Agent and without paying
any processing fee therefor, assign all or a portion of its interests in any
Loans to its Granting Lender or to any financial institutions (if consented to
by the Company and the Administrative Agent) providing liquidity and/or credit
facilities to or for the account of such SPC to fund the Loans made by such SPC
or to support the securities (if any) issued by such SPC to fund such Loans and
(ii) disclose on a confidential basis any non-public information

                                      -78-

relating to its Loans to any rating agency, commercial paper dealer or provider
of a surety, guarantee or credit or liquidity enhancement to such SPC.

         Section 11.05. Survival. All covenants, agreements, representations and
warranties made by any Borrower herein and in the certificates or other
instruments delivered in connection with or pursuant to this Agreement shall be
considered to have been relied upon by the other parties hereto and shall
survive the execution and delivery of this Agreement and the making of any Loans
and issuance of any Letters of Credit regardless of any investigation made by
any such other party or on its behalf and notwithstanding that the
Administrative Agent or any Lender may have had notice or knowledge of any
Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as any
Letter of Credit is outstanding, the principal of or any accrued interest on any
Loan or any fee or any other amount payable under this Agreement is outstanding
and unpaid and so long as the Total Commitment (and the Commitment of each
Lender) has not expired or terminated. The provisions of Sections 2.12, 2.13,
2.14 and 11.03 and Article IX shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the
repayment of the Loans, the expiration or termination of the Total Commitment
(and the Commitment of each Lender) or the termination of this Agreement or any
provision hereof.

         Section 11.06. Counterparts; Integration; Effectiveness. This Agreement
may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement and any
separate letter agreements with respect to fees payable to the Administrative
Agent constitute the entire contract among the parties relating to the subject
matter hereof and supersede any and all previous agreements and understandings,
oral or written, relating to the subject matter hereof. Except as provided in
Section 5.01, this Agreement shall become effective when it shall have been
executed by the Administrative Agent and when the Administrative Agent shall
have received counterparts hereof which, when taken together, bear the
signatures of each of the other parties hereto, and thereafter shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by facsimile shall be effective as delivery of a manually
executed counterpart of this Agreement.

         Section 11.07. Severability. Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

         Section 11.08. Right of Setoff. If an Event of Default shall have
occurred and be continuing, each Lender and each of its Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other obligations at any time
owing by such Lender or Affiliate to or for the credit or the account of any
Borrower against any of and all the obligations of such Borrower now or
hereafter existing under this Agreement held by such Lender, irrespective of
whether or not such Lender shall have made any demand under this Agreement and
although such obligations may be unmatured. The rights of

                                      -79-

each Lender under this Section are in addition to other rights and remedies
(including other rights of setoff) which such Lender may have.

         Section 11.09. Governing Law; Jurisdiction; Consent to Service of
Process(a) . This Agreement shall be construed in accordance with and governed
by the law of the State of New York.

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

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

         (d) Each party to this Agreement irrevocably consents to service of
process in connection with disputes arising out of this Agreement or any other
Credit Document in the manner provided for notices in Section 11.01. Nothing in
this Agreement will affect the right of any party to this Agreement to serve
process in any other manner permitted by law.

         (e) Each Borrower hereby irrevocably designates, appoints and empowers
the Service of Process Agent, with offices on the date hereof at 111 Eighth
Avenue, 13th Floor, New York, New York 10011, as its designee, appointee and
agent to receive, accept and acknowledge for and on its behalf, and in respect
of its property, service of any and all legal process, summons, notices and
documents which may be served in any such action or proceeding. If for any
reason such designee, appointee and agent shall cease to be available to act as
such, each Borrower agrees to designate a new designee, appointee and agent in
New York City on the terms and for the purposes of this provision reasonably
satisfactory to the Administrative Agent under this agreement.

         Section 11.10. Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
BASED ON CONTRACT,

                                      -80-

TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

         Section 11.11. Headings. Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

         Section 11.12. Confidentiality. Each of the Administrative Agent and
the Lenders agrees to maintain the confidentiality of the Information (as
defined below), except that Information may be disclosed (a) to its and its
Affiliates' directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that (i) the Persons to
whom such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential in accordance
with the terms of this Agreement and (ii) that the Administrative Agent and each
Lender shall be responsible for any breach of this Section 11.12 by any of its
and its Affiliates' directors, officers, employees and agents, including
accountants, legal counsel and other advisors), (b) to the extent requested by
any regulatory authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party
to this Agreement, (e) in connection with the exercise of any remedies hereunder
or any suit, action or proceeding relating to this Agreement or the enforcement
of rights hereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
any Borrower and its obligations, (g) with the consent of the Company or (h) to
the extent such Information (i) becomes publicly available other than as a
result of a breach of this Section or (ii) becomes available to the
Administrative Agent or any Lender on a non-confidential basis from a source
other than the Company. For the purposes of this Section, "Information" means
all information now or hereafter received from any Borrower relating to the
Company, any Subsidiary of the Company or their respective businesses, other
than any such information that is available to the Administrative Agent or any
Lender on a non-confidential basis prior to disclosure by any Borrower. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information or, in the case of any Lender, such Lender has treated
such Information in a manner consistent with banking industry standards for the
treatment of confidential information. Notwithstanding anything herein to the
contrary, each party to this Agreement (and any employee, representative or
other agent of each such party) may disclose to any and all persons, without
limitation of any kind, the U.S. federal income tax treatment and the U.S.
federal income tax structure of the transactions contemplated hereby and all
materials of any kind (including opinions or other tax analyses) that are
provided to it relating to such tax treatment and tax structure. However, no
disclosure of any information relating to such tax treatment or tax

                                      -81-

structure may be made to the extent non-disclosure is reasonably necessary in
order to comply with applicable securities laws. The provisions of this Section
11.12 shall survive the termination of the Total Commitment (and the Commitment
of each Lender) and repayment of the Loans and other obligations arising
hereunder.

         Section 11.13. Interest Rate Limitation. Notwithstanding anything
herein to the contrary, if at any time the interest rate applicable to any Loan,
together with all fees, charges and other amounts which are treated as interest
on such Loan under applicable law (collectively the "Charges"), shall exceed the
maximum lawful rate (the "Maximum Rate") which may be contracted for, charged,
taken, received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the Federal Funds Effective Rate to the date of
repayment, shall have been received by such Lender.

         Section 11.14. USA Patriot Act. Each Lender hereby notifies the Company
and each other Borrower that pursuant to the requirements of the USA Patriot Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the "Patriot
Act"), it is required to obtain, verify and record information that identifies
each Borrower, which information includes the name and address of each Borrower
and other information that will allow such Lender to identify each Borrower in
accordance with the Patriot Act.

                                      *****

                                      -82-

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

Address:
-------
Cumberland House                        QUANTA CAPITAL HOLDINGS LTD.
1 Victoria Street
Hamilton HM 11
Bermuda                                 By: /s/ John S. Brittain, Jr.
                                           --------------------------
Attention: Controller                      Name:  John S. Brittain, Jr.
Telephone: (441) 294-6350                  Title: Chief Financial Officer
Facsimile: (441) 294-6390

Address:
-------
Cumberland House                        QUANTA REINSURANCE LTD.
1 Victoria Street
Hamilton HM 11
Bermuda                                 By: /s/ John S. Brittain, Jr.
                                           --------------------------
Attention: John S. Brittain, Jr.           Name:  John S. Brittain, Jr.
Facsimile: (441) 294-6390                  Title: Chief Financial Officer

Address:
-------
10 Rockefeller Plaza, Third Floor       QUANTA U.S. HOLDINGS INC.
New York, New York 10020
United States of America
Attention: John S. Brittain, Jr.        By: /s/ Gary G. Wang
                                           -----------------
Facsimile: (212) 373-1801                  Name:  Gary G. Wang
                                           Title: Chief Risk Officer

Address:
-------
c/o Quanta U.S. Holdings, Inc.          QUANTA SPECIALTY LINES INSURANCE COMPANY
10 Rockefeller Plaza, Third Floor
New York, New York 10020
United States of America                By: /s/ Gary G. Wang
                                           ------------------
Attention: John S. Brittain, Jr.           Name:  Gary G. Wang
Facsimile: (212) 373-1801                  Title: Chief Risk Officer

Address:
-------
Cumberland House                           QUANTA REINSURANCE U.S. LTD.
1 Victoria Street
Hamilton HM 11
Bermuda                                    By: /s/ John S. Brittain, Jr.
                                              --------------------------
Attention: John S. Brittain, Jr.              Name:  John S. Brittain, Jr.
Facsimile: (441) 294-6390                     Title: Chief Financial Officer

Address:
-------
c/o Quanta U.S. Holdings, Inc.             QUANTA INDEMNITY COMPANY
10 Rockefeller Plaza, Third Floor
New York, New York  10020
United States of America                   By: /s/ Gary G. Wang
                                              -----------------
Attention: John S. Brittain, Jr.              Name:  Gary G. Wang
Facsimile: (212) 373-1801                     Title: Chief Risk Officer

                          JPMORGAN CHASE BANK, Individually and as
                          Administrative Agent

                          By: /s/ Heather Lindstrom
                              --------------------------------------
                              Name: Heather Lindstrom
                              Title: Vice President

                          BANK OF AMERICA, N.A., Individually and as
                          Co-Syndication Agent

                          By: /s/ Debra Basler
                              --------------------------------------
                              Name: Debra Basler
                              Title: Principal

                          CALYON, NEW YORK BRANCH, Individually and as
                          Co-Syndication Agent

                          By: /s/ William Denton
                              --------------------------------------
                              Name: William Denton
                              Title: Managing Director

                          By: /s/ Sebastian Rocco
                              Name: Sebastian Rocco
                              Title:  Managing Director

                        DEUTSCHE BANK AG NEW YORK BRANCH

                          By: /s/ Ruth Leung
                              --------------------------------------
                              Name: Ruth Leung
                              Title: Director

                          By: /s/ John S. McGill
                              --------------------------------------
                              Name: John S. McGill
                              Title: Director

                          BARCLAYS BANK PLC

                          By: /s/ Paul Johnson
                              --------------------------------------
                              Name: Paul Johnson
                              Title: Relationship Director

                          COMERICA BANK

                          By: /s/ Chatphet Saipetch
                              --------------------------------------
                              Name: Chatphet Saipetch
                              Title: Assistant Vice President<PAGE>
                                                                   EXHIBIT 10.15

================================================================================

                                              Published CUSIP Number: __________

                                CREDIT AGREEMENT

                            Dated as of May 27, 2004,

                                      among

                               PACTIV CORPORATION
                                as the Borrower,

                             BANK OF AMERICA, N.A.,
                            as Administrative Agent,

                                  BANK ONE, NA,
                    as Syndication Agent and the L/C Issuer,

                                  BNP PARIBAS,
                                 SUNTRUST BANK,
                          CITICORP NORTH AMERICA, INC.,
                           as Co-Documentation Agents

                                       and

                         The Other Lenders Party Hereto

                         BANC OF AMERICA SECURITIES LLC
                                       and
                         BANC ONE CAPITAL MARKETS, INC.,
                                       as
                  Joint Lead Arrangers and Joint Book Managers

================================================================================
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
         Section                                                                                                 Page
         -------                                                                                                 ----
<S>                                                                                                              <C>
                                                    ARTICLE I.
                                         DEFINITIONS AND ACCOUNTING TERMS

1.01    Defined Terms..........................................................................................    1
1.02    Other Interpretive Provisions..........................................................................   17
1.03    Accounting Terms.......................................................................................   17
1.04    Rounding...............................................................................................   18
1.05    References to Agreements and Laws......................................................................   18
1.06    Times of Day...........................................................................................   18
1.07    Letter of Credit Amounts...............................................................................   18
1.08    Accounting for Acquisitions and Dispositions...........................................................   18

                                                    ARTICLE II.
                                       THE COMMITMENTS AND CREDIT EXTENSIONS

2.01    Loans..................................................................................................   19
2.02    Borrowings, Conversions and Continuations of Loans.....................................................   19
2.03    Letters of Credit......................................................................................   21
2.04    [Intentionally Omitted]................................................................................   29
2.05    Prepayments............................................................................................   29
2.06    Termination or Reduction of Commitments................................................................   29
2.07    Repayment of Loans.....................................................................................   30
2.08    Interest...............................................................................................   30
2.09    Fees...................................................................................................   31
2.10    Computation of Interest and Fees.......................................................................   31
2.11    Evidence of Debt.......................................................................................   31
2.12    Payments Generally.....................................................................................   32
2.13    Sharing of Payments....................................................................................   33
2.14    Increase in Commitments................................................................................   34

                                                   ARTICLE III.
                                      TAXES, YIELD PROTECTION AND ILLEGALITY

3.01    Taxes..................................................................................................   35
3.02    Illegality.............................................................................................   37
3.03    Inability to Determine Rates...........................................................................   37
3.04    Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans.................   37
3.05    Compensation for Losses................................................................................   38
3.06    Matters Applicable to all Requests for Compensation....................................................   39
3.07    Mitigation Obligations; Replacement of Lenders.........................................................   39
</TABLE>

                                        i
<PAGE>
<TABLE>
<S>                                                                                                               <C>
3.08    Survival...............................................................................................   39

                                                    ARTICLE IV.
                                     CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

4.01    Conditions of Initial Credit Extension.................................................................   40
4.02    Conditions to all Credit Extensions....................................................................   41

                                                    ARTICLE V.
                                          REPRESENTATIONS AND WARRANTIES

5.01    Existence, Qualification and Power; Compliance with Laws...............................................   42
5.02    Authorization; No Contravention........................................................................   42
5.03    Governmental Authorization; Other Consents.............................................................   42
5.04    Binding Effect.........................................................................................   42
5.05    Litigation.............................................................................................   42
5.06    No Default.............................................................................................   43
5.07    ERISA Compliance.......................................................................................   43
5.08    Use of Proceeds; Margin Regulations....................................................................   43
5.09    Ownership of Property; Liens...........................................................................   44
5.10    Taxes..................................................................................................   44
5.11    Financial Statements; No Material Adverse Effect.......................................................   44
5.12    Environmental Compliance...............................................................................   44
5.13    Regulated Entities.....................................................................................   45
5.14    No Burdensome Restrictions.............................................................................   45
5.15    Subsidiaries...........................................................................................   45
5.16    Insurance..............................................................................................   45
5.17    Disclosure.............................................................................................   45

                                                    ARTICLE VI.
                                               AFFIRMATIVE COVENANTS

6.01    Financial Statements...................................................................................   45
6.02    Certificates; Other Information........................................................................   46
6.03    Notices................................................................................................   47
6.04    Preservation of Corporate Existence, Etc...............................................................   48
6.05    Maintenance of Property................................................................................   48
6.06    Maintenance of Insurance...............................................................................   48
6.07    Payment of Taxes.......................................................................................   48
6.08    Compliance with Laws...................................................................................   48
6.09    Compliance with ERISA..................................................................................   49
6.10    Books and Records and Inspection Rights................................................................   49
6.11    Environmental Laws.....................................................................................   49
6.12    Use of Proceeds........................................................................................   49
6.13    Change in Business.....................................................................................   50
</TABLE>

                                       ii
<PAGE>
<TABLE>
<S>                                                                                                               <C>
                                                   ARTICLE VII.
                                                NEGATIVE COVENANTS

7.01    Financial Condition Covenants..........................................................................   50
7.02    Liens..................................................................................................   50
7.03    Restrictions on Subsidiaries...........................................................................   52
7.04    Consolidation, Mergers and Sales of Assets.............................................................   52
7.05    Limitation on Subsidiary Indebtedness..................................................................   52
7.06    Transactions with Affiliates...........................................................................   52
7.07    Use of Proceeds........................................................................................   53
7.08    ERISA..................................................................................................   53
7.09    Securitization Transactions............................................................................   53

                                                   ARTICLE VIII.
                                          EVENTS OF DEFAULT AND REMEDIES

8.01    Events of Default......................................................................................   53
8.02    Remedies Upon Event of Default.........................................................................   55
8.03    Application of Funds...................................................................................   56

                                                    ARTICLE IX.
                                               ADMINISTRATIVE AGENT

9.01    Appointment and Authorization of Administrative Agent..................................................   57
9.02    Delegation of Duties...................................................................................   57
9.03    Liability of Administrative Agent......................................................................   57
9.04    Reliance by Administrative Agent.......................................................................   58
9.05    Notice of Default......................................................................................   58
9.06    Credit Decision; Disclosure of Information by Administrative Agent.....................................   59
9.07    Indemnification of Administrative Agent................................................................   59
9.08    Individual Capacities..................................................................................   59
9.09    Successor Administrative Agent.........................................................................   60
9.10    Administrative Agent May File Proofs of Claim..........................................................   61
9.11    Other Agents; Arrangers and Managers...................................................................   62

                                                    ARTICLE X.
                                                   MISCELLANEOUS

10.01   Amendments, Etc........................................................................................   62
10.02   Notices and Other Communications; Facsimile Copies.....................................................   63
10.03   No Waiver; Cumulative Remedies.........................................................................   64
10.04   Attorney Costs, Expenses and Taxes.....................................................................   64
10.05   Indemnification by the Borrower........................................................................   65
10.06   Payments Set Aside.....................................................................................   66
10.07   Successors and Assigns.................................................................................   66
</TABLE>

                                      iii
<PAGE>
<TABLE>
<S>                                                                                                               <C>
10.08   Confidentiality........................................................................................   69
10.09   Set-off................................................................................................   70
10.10   Interest Rate Limitation...............................................................................   70
10.11   Counterparts...........................................................................................   71
10.12   Integration............................................................................................   71
10.13   Survival of Representations and Warranties.............................................................   71
10.14   Severability...........................................................................................   71
10.15   Tax Forms..............................................................................................   71
10.16   Replacement of Lenders.................................................................................   73
10.17   Governing Law..........................................................................................   73
10.18   Waiver of Right to Trial by Jury.......................................................................   74
10.19   USA PATRIOT Act Notice.................................................................................   74
10.20   Termination of Existing Credit Agreement ..............................................................   75
</TABLE>

                                       iv
<PAGE>
SCHEDULES

         1.01     Existing Letters of Credit
         2.01     Commitments and Pro Rata Shares
         5.12     Environmental Matters
         5.15     Subsidiaries and Other Equity Investments
         7.02     Existing Liens
         10.02    Administrative Agent's Office, Certain Addresses for Notices

EXHIBITS
                  FORM OF

         A        Loan Notice
         B        Note
         C        Compliance Certificate
         D        Assignment and Assumption
         E        Opinion Matters
         F        Form of Letter of Credit Information Report

                                       v
<PAGE>
                                CREDIT AGREEMENT

      This CREDIT AGREEMENT ("Agreement") is entered into as of May 27, 2004,
among PACTIV CORPORATION, a Delaware corporation (the "Borrower"), each lender
from time to time party hereto (collectively, the "Lenders" and individually, a
"Lender"), BANK OF AMERICA, N.A., as Administrative Agent, and BANK ONE, NA,
with its main office in Chicago, Illinois, as Syndication Agent and L/C Issuer.

      The Borrower has requested that the Lenders provide a revolving credit
facility, with a letter of credit subfacility, and the Lenders are willing to do
so on the terms and conditions set forth herein.

      In consideration of the mutual covenants and agreements herein contained,
the parties hereto covenant and agree as follows:

                                   ARTICLE I.
                        DEFINITIONS AND ACCOUNTING TERMS

      1.01 DEFINED TERMS. As used in this Agreement, the following terms shall
have the meanings set forth below:

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

      "Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.

      "Administrative Agent's Office" means the Administrative Agent's address
and, as appropriate, account as set forth on Schedule 10.02, or such other
address or account as the Administrative Agent may from time to time notify the
Borrower and the Lenders.

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

      "Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "Control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly,

                                       1
<PAGE>
power to vote 10% or more of the securities having ordinary voting power for the
election of directors, managing general partners or the equivalent.

      "Agent-Related Persons" means the Administrative Agent, together with its
Affiliates (including, in the case of Bank of America in its capacity as the
Administrative Agent, BAS), and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and Affiliates.

      "Aggregate Commitments" means the Commitments of all the Lenders.

      "Agreement" means this Credit Agreement.

      "Applicable Rate" means, from time to time, the following percentages per
annum, based upon the Debt Rating as set forth below:

<TABLE>
<CAPTION>
                                                                  EURODOLLAR
                                                                   RATE AND
          PRICING        DEBT RATINGS                             LETTERS OF
           LEVEL         S&P/MOODY'S         FACILITY FEE           CREDIT
          -------        -----------         ------------         ----------
<S>                    <C>                   <C>                  <C>
             1         A-/A3 or better           0.100%             0.400%
             2            BBB+/Baa1              0.125%             0.500%
             3             BBB/Baa2              0.175%             0.575%
             4            BBB-/Baa3              0.200%             0.675%
             5         Below BBB-/Baa3           0.250%             0.875%
</TABLE>

            "Debt Rating" means, as of any date of determination, the rating as
      determined by either S&P or Moody's (collectively, the "Debt Ratings") of
      the Borrower's non-credit-enhanced, senior unsecured long-term debt;
      provided that if a Debt Rating is issued by each of the foregoing rating
      agencies, then the higher of such Debt Ratings shall apply (with the Debt
      Rating for Pricing Level 1 being the highest and the Debt Rating for
      Pricing Level 5 being the lowest), unless there is a split in Debt Ratings
      of more than one level, in which case the Pricing Level that is one level
      lower than the Pricing Level of the higher Debt Rating shall apply.

Initially, the Applicable Rate shall be determined based upon the Debt Ratings
specified in the certificate delivered pursuant to Section 4.01(a)(vii).
Thereafter, each change in the Applicable Rate resulting from a publicly
announced change in any Debt Rating shall be effective during the period
commencing on the date of the public announcement thereof and ending on the date
immediately preceding the effective date of the next such change. Pricing Level
5 shall apply during any period in which both S&P and Moody's have ceased or
suspended issuing Debt Ratings of the Borrower's non-credit-enhanced, senior
unsecured long-term debt.

      "Arrangers" means BAS and BOCM, collectively, in their capacities as joint
lead arrangers and joint book managers.

                                       2
<PAGE>
      "Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit D.

      "Attorney Costs" means and includes all reasonable fees and disbursements
of any law firm or other external counsel.

      "Attributable Indebtedness" means, on any date, (a) in respect of any
Capital Lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease payments under the relevant lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a Capital Lease.

      "Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal year ended December
31, 2003, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for such fiscal year of the Borrower and its
Subsidiaries, including the notes thereto.

      "Availability Period" means the period from the Closing Date to the
earliest of (a) the Maturity Date, (b) the date of termination of the Aggregate
Commitments pursuant to Section 2.06, and (c) the date of termination of the
commitment of each Lender to make Loans and of the obligation of the L/C Issuer
to make L/C Credit Extensions pursuant to Section 8.02.

      "Bank of America" means Bank of America, N.A. and its successors.

      "Bank One" means Bank One, NA, with its main office in Chicago, Illinois,
and its successors.

      "BAS" means Banc of America Securities LLC.

      "Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in such rate announced by Bank of America shall take effect at
the opening of business on the day specified in the public announcement of such
change.

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

      "BOCM" means Banc One Capital Markets, Inc.

      "Borrower" has the meaning specified in the introductory paragraph hereto.

      "Borrowing" means a borrowing consisting of simultaneous Loans of the same
Type and, in the case of Eurodollar Rate Loans, having the same Interest Period
made by each of the Lenders pursuant to Section 2.01.

                                       3
<PAGE>
      "Business Day" means (a) any day other than a Saturday, Sunday, a standard
holiday of the Federal Reserve System or any other day on which commercial banks
are authorized to close under the Laws of, or are in fact closed in, the State
of Illinois or the state where the Administrative Agent's Office is located and
(b) if such day relates to any Eurodollar Rate Loan, any such day on which
dealings in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market.

      "Capital Lease" means, with respect to any Person, any lease of (or other
agreement conveying the right to use) any real or personal property by such
Person that, in conformity with GAAP, is accounted for as a capital lease on the
balance sheet of such Person.

      "Cash Collateralize" has the meaning specified in Section 2.03(g).

      "Change of Control" means that (a) any Person or group (within the meaning
of Rule 13d-5 of the SEC under the Exchange Act) shall have beneficial ownership
(within the meaning of Rule 13d-3 promulgated by the SEC) of 30% or more of the
Voting Stock of the Borrower or (b) a majority of the members of the Board of
Directors of the Borrower shall cease to be Continuing Members.

      "Closing Date" means the first date all the conditions precedent in
Section 4.01 are satisfied or waived in accordance with Section 10.01.

      "Code" means the Internal Revenue Code of 1986.

      "Commitment" means, as to each Lender, its obligation to (a) make Loans to
the Borrower pursuant to Section 2.01, and (b) purchase participations in L/C
Obligations, in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 or in
the Assignment and Assumption pursuant to which such Lender becomes a party
hereto, as applicable, as such amount may be adjusted from time to time in
accordance with this Agreement.

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

      "Computation Period" means any period of four consecutive fiscal quarters
ending on the last day of a fiscal quarter.

      "Consolidated EBITDA" means, with respect to the Borrower and its
Subsidiaries for any period, the sum of (a) Consolidated Net Income for such
period, plus (b) the sum of the following, in each case to the extent included
in computing such Consolidated Net Income: (i) Consolidated Interest Expense,
plus (ii) taxes on income, plus (iii) amortization, plus (iv) depreciation plus
(v) minority interest expense.

      "Consolidated Interest Expense" means, with respect to any period of
computation thereof, the interest expense of the Borrower and its Subsidiaries,
including (i) the amortization of debt discounts, (ii) the amortization of all
fees payable in connection with the incurrence of Indebtedness to the extent
included in interest expense, and (iii) the portion of any lease expense
incurred in connection with Capital Leases or Synthetic Lease Obligations
allocable to interest expense.

                                       4
<PAGE>
      "Consolidated Net Income" means, for any period of computation thereof,
the net income (or loss) of the Borrower and its Subsidiaries on a consolidated
basis for such period, plus (a) the following (without duplication) to the
extent deducted in calculating such net income (or loss): (i) One Time Charges,
(ii) non-recurring losses and other extraordinary losses of the Borrower and its
Subsidiaries reducing such net income (or increasing such net loss) which do not
represent cash items in such period, and (iii) the Specified Non-Recurring Cash
Items, and minus (b) the following (without duplication) to the extent added or
not deducted in calculating such net income (or loss): (i) non-recurring gains
and extraordinary gains increasing net income (or reducing net loss) which do
not represent cash items in such period; and (ii) the amount of any cash
expenditures made during such period related to non-cash, non-recurring losses
or non-cash, extraordinary losses added back to net income under clause (a)(ii)
above in computing Consolidated Net Income during any prior period.

      "Contingent Obligation" means, as to any Person, any direct or indirect
liability of such Person, whether or not contingent, (a) with respect to any
Indebtedness, lease, dividend, letter of credit or other obligation (the
"primary obligations") of another Person (the "primary obligor"), including any
obligation of such Person (i) to purchase, repurchase or otherwise acquire such
primary obligations or any security therefor, (ii) to advance or provide funds
for the payment or discharge of any such primary obligation, or to maintain
working capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency or any balance sheet item, level of income or
financial condition of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation, or (iv) otherwise to assure or hold harmless the holder
of any such primary obligation against loss in respect thereof (each a "Guaranty
Obligation"); (b) with respect to any Surety Instrument issued for the account
of such Person or as to which such Person is otherwise liable for reimbursement
of drawings or payments; or (c) to purchase any materials, supplies or other
property from, or to obtain the services of, another Person if the relevant
contract or other related document or obligation requires that payment for such
materials, supplies or other property, or for such services, shall be made
regardless of whether delivery of such materials, supplies or other property is
ever made or tendered, or such services are ever performed or tendered. The
amount of any Contingent Obligation shall (x) in the case of Guaranty
Obligations, be deemed equal to the stated or determinable amount of the primary
obligation in respect of which such Guaranty Obligation is made or, if not
stated or if indeterminable, the maximum reasonably anticipated liability in
respect thereof, and (y) in the case of other Contingent Obligations, be equal
to the maximum reasonably anticipated liability in respect thereof.

      "Continuing Member" means a member of the Board of Directors of the
Borrower who either (a) was a member of the Borrower's Board of Directors on the
Closing Date and has been such continuously thereafter or (b) became a member of
such Board of Directors after the Closing Date and whose election or nomination
for election was approved by a vote of the majority of the Continuing Members
then members of the Borrower's Board of Directors.

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

                                       5
<PAGE>
      "Control" has the meaning specified in the definition of "Affiliate."

      "Credit Extension" means each of the following: (a) a Borrowing and (b) an
L/C Credit Extension.

      "Debt Rating" has the meaning specified in the definition of Applicable
Rate.

      "Debtor Relief Laws" means the Bankruptcy Code of the United States, and
all other liquidation, conservatorship, bankruptcy, assignment for the benefit
of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.

      "Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.

      "Default Rate" means (a) when used with respect to Obligations other than
Letter of Credit Fees, an interest rate equal to (i) the Base Rate plus (ii) 2%
per annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum, and (b)
when used with respect to Letter of Credit Fees, a rate equal to the Applicable
Rate plus 2% per annum, in all cases to the fullest extent permitted by
applicable Laws.

      "Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Loans or participations in L/C Obligations required to be funded
by it hereunder within one Business Day of the date required to be funded by it
hereunder, unless the amount not funded is the subject of a good faith dispute
and such Lender has otherwise funded all undisputed amounts within one Business
Day of the date when required to be funded by it hereunder, (b) has otherwise
failed to pay over to the Administrative Agent or any other Lender any other
amount required to be paid by it hereunder within one Business Day of the date
when due, unless the amount not paid is the subject of a good faith dispute and
such Lender has otherwise paid all undisputed amounts within one Business Day of
the date when due, or (c) has been deemed insolvent or become the subject of a
bankruptcy or insolvency proceeding.

      "Disposition" means any transaction or series of related transactions for
the purpose of or resulting, directly or indirectly, in (a) the disposition of
all or substantially all of the assets of a Person, or of all or substantially
all of any business or division of a Person, (b) the disposition of in excess of
50% of the capital stock, partnership interests, membership interests or other
equity interests of any Subsidiary, or otherwise causing any Person to cease to
be a Subsidiary, or (c) a merger or consolidation or any other combination with
another Person (other than a Person that is a Subsidiary) if the surviving
entity is not the Company or a Subsidiary.

      "Dollar" and "$" mean lawful money of the United States.

      "Eligible Assignee" has the meaning specified in Section 10.07(g).

                                       6
<PAGE>
      "Environmental Claims" means all written claims, however asserted, by any
Governmental Authority or any other Person alleging potential liability or
responsibility for violation of any Environmental Law or for release to the
environment.

      "Environmental Laws" means all Laws, together with all administrative or
judicial orders, directed duties, requests, licenses, authorizations and permits
of, and agreements with, any Governmental Authorities, in each case relating to
environmental, health, safety and land use matters.

      "ERISA" means the Employee Retirement Income Security Act of 1974.

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

      "ERISA Event" means (a) a Reportable Event with respect to a Pension Plan;
(b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate.

      "Eurodollar Rate" means for any Interest Period with respect to a
Eurodollar Rate Loan:

            (a) the rate per annum equal to the rate determined by the
      Administrative Agent to be the offered rate that appears on the page of
      the Telerate screen (or any successor thereto) that displays an average
      British Bankers Association Interest Settlement Rate for deposits in
      Dollars (for delivery on the first day of such Interest Period) with a
      term equivalent to such Interest Period, determined as of approximately
      11:00 a.m. (London time) two Business Days prior to the first day of such
      Interest Period, or

            (b) if the rate referenced in the preceding clause (a) does not
      appear on such page or service or such page or service shall not be
      available, the rate per annum equal to the rate determined by the
      Administrative Agent to be the offered rate on such other page or other
      service that displays an average British Bankers Association Interest
      Settlement Rate for deposits in Dollars (for delivery on the first day of
      such Interest Period) with a term equivalent to such Interest Period,
      determined as of approximately 11:00 a.m. (London time) two Business Days
      prior to the first day of such Interest Period, or

                                       7
<PAGE>
            (c) if the rates referenced in the preceding clauses (a) and (b) are
      not available, the rate per annum determined by the Administrative Agent
      as the rate of interest at which deposits in Dollars for delivery on the
      first day of such Interest Period in same day funds in the approximate
      amount of the Eurodollar Rate Loan being made, continued or converted by
      Bank of America and with a term equivalent to such Interest Period would
      be offered by Bank of America's London Branch to major banks in the London
      interbank eurodollar market at their request at approximately 4:00 p.m.
      (London time) two Business Days prior to the first day of such Interest
      Period.

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

      "Event of Default" has the meaning specified in Section 8.01.

      "Exchange Act" means the Securities and Exchange Act of 1934.

      "Existing Credit Agreement" means that certain Long Term Credit Agreement
dated as of September 29, 1999, among the Borrower (then known as Tenneco
Packaging, Inc.), Bank of America, as agent, and a syndicate of lenders.

      "Existing Letters of Credit" means the letters of credit described on
Schedule 1.01.

      "Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such transactions on
the next preceding Business Day as so published on the next succeeding Business
Day, and (b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate (rounded
upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of
America on such day on such transactions as determined by the Administrative
Agent.

      "Fee Letters" means the letter agreement, dated April 7, 2004, among the
Borrower, Bank of America and BAS, and the letter agreement, dated April 7,
2004, among the Borrower, Bank One and BOCM, collectively.

      "Foreign Lender" has the meaning specified in Section 10.15(a)(i).

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

      "GAAP" means generally accepted accounting principles in the United States
set forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board, or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.

                                       8
<PAGE>
      "Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.

      "Granting Lender" has the meaning specified in Section 10.07(h).

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

      "Indebtedness" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money; (b) all obligations of such
Person to pay the deferred purchase price of property or services, except such
obligations arising in the ordinary course of business and maturing less than
one year from the date of creation thereof; (c) all non-contingent reimbursement
or payment obligations of such Person with respect to Surety Instruments; (d)
all non-contingent obligations of such Person evidenced by notes, bonds,
debentures or similar instruments; (e) all obligations of such Person with
respect to Capital Leases and all Synthetic Lease Obligations; (f) all
indebtedness of any other Person of the types referred to in clauses (a) through
(e) above secured by (or for which the holder of such indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien upon or in
property (including accounts and contracts rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of such
indebtedness; provided that the amount of any such Indebtedness shall be deemed
to be the lesser of the face principal amount thereof and the fair market value
of the property subject to such Lien; (g) all indebtedness of the types
described in clauses (a) through (e) above of any partnership or joint venture
in which such Person is a general partner or joint venturer unless expressly
non-recourse to such Person; and (h) all Guaranty Obligations of such Person in
respect of Indebtedness of the types described above; provided that Indebtedness
shall not include (i) obligations arising out of the endorsement of instruments
for deposit or collection in the ordinary course of business, (ii) obligations
in respect of Securitization Transactions or (iii) obligations under operating
leases (other than Synthetic Lease Obligations). The amount of any Capital Lease
or Synthetic Lease Obligation as of any date shall be deemed to be the amount of
Attributable Indebtedness in respect thereof as of such date.

      "Indemnified Liabilities" has the meaning specified in Section 10.05.

      "Indemnitees" has the meaning specified in Section 10.05.

      "Independent Auditor" has the meaning specified in Section 6.01(a).

      "Insolvency Proceeding" means, with respect to any Person, (a) any case,
action or proceeding with respect to such Person or all or any substantial
portion of such Person's property before any court or Governmental Authority
relating to bankruptcy, reorganization, insolvency, liquidation, receivership,
conservatorship, dissolution, winding-up or relief of debtors, or (b) any
general assignment for the benefit of creditors, composition, marshalling of
assets for creditors, or other, similar arrangement in respect of its creditors
generally or any substantial portion of its creditors; in each case undertaken
under any Debtor Relief Law.

                                       9
<PAGE>
      "Interest Coverage Ratio" means, for any Computation Period, the ratio of
(a) Consolidated EBITDA for such Computation Period to (b) Consolidated Interest
Expense for such Computation Period.

      "Interest Payment Date" means, (a) as to any Loan other than a Base Rate
Loan, the last day of each Interest Period applicable to such Loan and the
Maturity Date; provided, however, that if any Interest Period for a Eurodollar
Rate Loan exceeds three months, the respective dates that fall every three
months after the beginning of such Interest Period shall also be Interest
Payment Dates; and (b) as to any Base Rate Loan, the last Business Day of each
March, June, September and December and the Maturity Date.

      "Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one, two, three or
six months thereafter, as selected by the Borrower in its Loan Notice; provided
that:

            (i) any Interest Period that would otherwise end on a day that is
      not a Business Day shall be extended to the next succeeding Business Day
      unless such Business Day falls in another calendar month, in which case
      such Interest Period shall end on the next preceding Business Day;

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

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

      "IRS" means the United States Internal Revenue Service.

      "ISP" means, with respect to any Letter of Credit, the "International
Standby Practices 1998" published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the time of
issuance).

      "Issuer Documents" means with respect to any Letter of Credit, the Letter
of Credit Application, and any other document, agreement and instrument entered
into between the L/C Issuer and the Borrower (or any Subsidiary) or in favor of
the L/C Issuer and relating to any such Letter of Credit.

      "Knowledge of the Borrower" means the actual knowledge of any one or more
of (a) the chief executive officer or the president of the Borrower, or any
other officer having substantially the same authority and responsibility, (b)
with respect to financial matters, the chief financial officer or the treasurer
of the Borrower, or any other officer having substantially the same authority
and responsibility, and (c) with respect to litigation and Requirements of Law,
the general counsel of the Borrower.

      "Laws" means, collectively, all international, foreign, Federal, state and
local statutes, treaties, rules, guidelines, regulations, ordinances, codes and
administrative or judicial

                                       10
<PAGE>
precedents or authorities, including the interpretation or administration
thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative
orders, directed duties, requests, licenses, authorizations and permits of, and
agreements with, any Governmental Authority, in each case whether or not having
the force of law.

      "L/C Advance" means, with respect to each Lender, such Lender's funding of
its participation in any L/C Borrowing in accordance with its Pro Rata Share.

      "L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing.

      "L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the increase of the
amount thereof.

      "L/C Issuer" means Bank One in its capacity as issuer of Letters of Credit
hereunder, or any successor issuer of Letters of Credit hereunder; provided,
that, for so long as any Existing Letter of Credit is outstanding, the term "L/C
Issuer" shall also include, with respect to each Existing Letter of Credit and
any related L/C Advances, L/C Borrowings, L/C Credit Extensions and L/C
Obligations, Bank of America in its capacity as issuer of the Existing Letters
of Credit; provided, further, that, notwithstanding any provision hereof to the
contrary, on and after the Closing Date, (x) Bank of America shall not, and
shall not have any obligation to, issue any Letter of Credit (other than the
Existing Letters of Credit deemed issued hereunder), but may, in its sole
discretion, elect from time to time, subject to the terms and conditions of this
Agreement, to renew or amend any Existing Letter of Credit upon request therefor
from the Borrower, and (y) all Letters of Credit (other than the Existing
Letters of Credit deemed issued hereunder) shall be issued by Bank One or any
successor issuer of Letters of Credit hereunder.

      "L/C Obligations" means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings. For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be "outstanding"
in the amount so remaining available to be drawn.

      "Lender" has the meaning specified in the introductory paragraph hereto
and, as the context requires, includes the L/C Issuer.

      "Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.

      "Letter of Credit" means any standby letter of credit issued hereunder and
shall include any Existing Letter of Credit.

      "Letter of Credit Application" means an application and agreement for the
issuance or amendment of a Letter of Credit in the form from time to time in use
by the L/C Issuer.

                                       11
<PAGE>
      "Letter of Credit Expiration Date" means the day that is seven days prior
to the Maturity Date then in effect (or, if such day is not a Business Day, the
next preceding Business Day).

      "Letter of Credit Fee" has the meaning specified in Section 2.03(i).

      "Letter of Credit Sublimit" means an amount equal to $100,000,000. The
Letter of Credit Sublimit is part of, and not in addition to, the Aggregate
Commitments.

      "Lien" means any security interest, mortgage, deed of trust, pledge,
hypothecation, assignment, charge or deposit arrangement, encumbrance, lien
(statutory or other) or preferential arrangement of any kind or nature
whatsoever in respect of any property (including those created by, arising under
or evidenced by any conditional sale or other title retention agreement, the
interest of a lessor under a Capital Lease, or any financing lease having
substantially the same economic effect as any of the foregoing, but not
including the interest of a lessor under an operating lease).

      "Loan" has the meaning specified in Section 2.01.

      "Loan Documents" means this Agreement, each Note, each Issuer Document,
and the Fee Letters.

      "Loan Notice" means a notice of (a) a Borrowing, (b) a conversion of Loans
from one Type to the other, or (c) a continuation of Eurodollar Rate Loans,
pursuant to Section 2.02(a), which, if in writing, shall be substantially in the
form of Exhibit A.

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

      "Material Adverse Effect" means (a) any event or circumstance that has
resulted in or would reasonably be expected to result in a material adverse
change in, or has had or would be reasonably expected to have a material adverse
effect upon, the operations, business, properties or condition (financial or
otherwise) of the Borrower and its Subsidiaries taken as a whole; (b) a material
impairment of the ability of the Borrower to perform its obligations under any
Loan Document; or (c) a material adverse effect upon the legality, validity,
binding effect or enforceability against the Borrower of any Loan Document;
provided, that, for the purpose of Sections 4.01(a)(vii)(B), 5.11(c) and 5.12
only, the occurrence and recognition of the charges described in the press
release attached to the Borrower's Form 8-K filed March 15, 2004, with the SEC,
and further described in the Borrower's Form 10-K/A filed March 16, 2004, and
the Borrower's Form 10-Q filed May 10, 2004, with the SEC shall be deemed not to
constitute a material adverse change.

      "Material Financial Obligations" means Indebtedness or Contingent
Obligations of the Borrower or any Subsidiary, or obligations of the Borrower or
any Subsidiary in respect of any Securitization Transaction, in an aggregate
amount (for all applicable Indebtedness, Contingent Obligations and obligations
in respect of Securitization Transactions, but without duplication) equal to
$50,000,000 or more (including amounts owing to all creditors under any combined
or syndicated credit arrangement).

                                       12
<PAGE>
      "Material Subsidiary" means, at any time, any Subsidiary having at such
time either (i) total (gross) revenues for any Computation Period in excess of
10% of total (gross) revenues for the Borrower and its Subsidiaries on a
consolidated basis or (ii) total assets, as of the last day of the preceding
fiscal quarter, having a net book value in excess of 10% of the assets of the
Borrower and its Subsidiaries on a consolidated basis, in each case, based upon
the Borrower's most recent consolidated annual or quarterly financial statements
delivered to the Lenders and the Administrative Agent under Section 6.01;
provided, however, that notwithstanding the foregoing, the term "Material
Subsidiary" shall mean each of those Subsidiaries that together with the
Borrower and each other Material Subsidiary have assets equal to not less than
90% of total assets (calculated as described above) and account for not less
than 90% of total revenue (calculated as described above); provided further that
if more than one combination of Subsidiaries satisfies such threshold, then
those Subsidiaries that are not "Material Subsidiaries" shall be those
Subsidiaries as may be specified by the Borrower to the Administrative Agent
from time to time in writing as not being "Material Subsidiaries" to the extent
such designation is consistent with the foregoing provisions of this definition.

      "Maturity Date" means May 27, 2009.

      "Moody's" means Moody's Investors Service, Inc. and any successor thereto.

      "Multiemployer Plan" means any employee benefit plan of the type described
in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate
makes or is obligated to make contributions, or during the preceding five plan
years, has made or been obligated to make contributions.

      "Note" means a promissory note made by the Borrower in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of Exhibit B.

      "Obligations" means all advances to, and debts, liabilities, obligations,
covenants and duties of, the Borrower arising under any Loan Document or
otherwise with respect to any Loan or Letter of Credit, whether direct or
indirect (including those acquired by assumption), absolute or contingent, due
or to become due, now existing or hereafter arising and including interest and
fees that accrue after the commencement by or against the Borrower or any
Affiliate thereof of any proceeding under any Debtor Relief Laws naming such
Person as the debtor in such proceeding, regardless of whether such interest and
fees are allowed claims in such proceeding.

      "One Time Charges" means, collectively, (a) the cash portion of the
litigation charges taken in the third fiscal quarter of 2003 described in Item 3
of the Borrower's Form 10-K/A filed March 16, 2004, and (b) the cash portion of
the restructuring and other charges taken in the first fiscal quarter of 2004
described in Note 3 to the Borrower's unaudited financial statements attached to
the Borrower's Form 10-Q filed May 10, 2004; provided, that the aggregate amount
of all charges included in this definition shall not exceed $115,000,000.

      "Organization Documents" means, (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect

                                       13
<PAGE>
to any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.

      "Outstanding Amount" means (i) with respect to Loans on any date, the
aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of Loans occurring on such date; and
(ii) with respect to any L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect on
such date.

      "Participant" has the meaning specified in Section 10.07(d).

      "PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any of its functions under ERISA.

      "Pension Plan" means any "employee pension benefit plan" (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.

      "Permitted Liens" has the meaning specified in Section 7.02.

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

      "Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.

      "Pro Rata Share" means, with respect to each Lender at any time, a
fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the Commitment of such Lender at such
time and the denominator of which is the amount of the Aggregate Commitments at
such time; provided that if the commitment of each Lender to make Loans and the
obligation of the L/C Issuer to make L/C Credit Extensions have been terminated
pursuant to Section 8.02, then the Pro Rata Share of each Lender shall be
determined based on the Pro Rata Share of such Lender immediately prior to such
termination and after giving effect to any subsequent assignments made pursuant
to the terms hereof. The initial Pro Rata Share of each Lender is set forth
opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.

                                       14
<PAGE>
      "Register" has the meaning specified in Section 10.07(c).

      "Reportable Event" means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the 30 day notice period has been waived.

      "Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Loans, a Loan Notice, and (b) with respect to an
L/C Credit Extension, a Letter of Credit Application.

      "Required Lenders" means, as of any date of determination, Lenders having
more than 50% of the Aggregate Commitments or, if the commitment of each Lender
to make Loans and the obligation of the L/C Issuer to make L/C Credit Extensions
have been terminated pursuant to Section 8.02, Lenders holding in the aggregate
more than 50% of the Total Outstandings (with the aggregate amount of each
Lender's risk participation and funded participation in L/C Obligations being
deemed "held" by such Lender for purposes of this definition); provided that the
Commitment of, and the portion of the Total Outstandings held or deemed held by,
any Defaulting Lender shall be excluded for purposes of making a determination
of Required Lenders.

      "Requirement of Law" means, as to any Person, any Law 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" means the chief executive officer, president, chief
financial officer, treasurer or assistant treasurer of the Borrower. Any
document delivered hereunder that is signed by a Responsible Officer shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of the Borrower and such Responsible
Officer shall be conclusively presumed to have acted on behalf of the Borrower.

      "S&P" means Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. and any successor thereto.

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

      "Securitization Transaction" means any sale, assignment or other transfer
by the Borrower or any Subsidiary of accounts receivable, lease receivables or
other payment obligations owing to the Borrower or any Subsidiary or any
interest in any of the foregoing, together in each case with any collections and
other proceeds thereof, any collection or deposit accounts related thereto, and
any collateral, guaranties or other property or claims in favor of the Borrower
or such Subsidiary supporting or securing payment by the obligor thereon of, or
otherwise related to, any such receivables; provided, that all payment,
repurchase and other obligations with respect thereto are nonrecourse to the
Borrower and its Subsidiaries (other than any special purpose finance Subsidiary
created solely for the purpose thereof and whose activities are limited to such
transactions), other than limited recourse provisions that are customary for
transactions of such type and do not have the effect of Guaranteeing or limiting
the loss or credit risk of lenders or purchasers with respect to payment or
performance by the obligors of the receivables or other payment obligations so
transferred.

                                       15
<PAGE>
      "SPC" has the meaning specified in Section 10.07(h).

      "Specified Non-Recurring Cash Items" means non-recurring cash expenses or
charges incurred in connection with bond redemptions or corporate restructurings
in any given fiscal year of the Borrower, in each case to the extent expressly
designated by the Borrower as "Specified Non-Recurring Cash Items" in the
Compliance Certificate delivered with respect to the first applicable
Computation Period that ends with the fiscal quarter in which such losses were
incurred; provided, that losses designated by the Borrower as "Specified
Non-Recurring Cash Items" shall not exceed (x) $50,000,000 in the aggregate in
any fiscal year except that any portion of such $50,000,000 amount not so
utilized in the fiscal year for which it is permitted may be carried over to be
utilized in the next following fiscal year, or (y) $250,000,000 in the aggregate
while this Agreement is in effect.

      "Subsidiary" of a Person means a corporation, partnership, joint venture,
limited liability company or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
the Borrower.

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

      "Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

      "Total Debt" means, at any time, the sum (determined on a consolidated
basis and without duplication) of all Indebtedness of the Borrower and its
Subsidiaries.

      "Total Debt to EBITDA Ratio" means, for any Computation Period, the ratio
of (a) Total Debt at the end of such Computation Period to (b) Consolidated
EBITDA for such Computation Period.

      "Total Outstandings" means the aggregate Outstanding Amount of all Loans
and all L/C Obligations.

      "Type" means, with respect to a Loan, its character as a Base Rate Loan or
a Eurodollar Rate Loan.

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

                                       16
<PAGE>
      "United States" and "U.S." mean the United States of America.

      "Unreimbursed Amount" has the meaning specified in Section 2.03(c)(i).

      "Voting Stock" means, with respect to any Person, any shares of stock or
other equity interests of any class or classes of such Person whose holders are
entitled under ordinary circumstances (irrespective of whether at the time stock
or other equity interests of any other class or classes shall have or might have
voting power by reason of the happening of any contingency) to vote for the
election of a majority of the directors, managers, trustees or other governing
body of such Person.

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

      1.02 OTHER INTERPRETIVE PROVISIONS. With reference to this Agreement and
each other Loan Document, unless otherwise specified herein or in such other
Loan Document:

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

      (b)   (i) The words "herein," "hereto," "hereof" and "hereunder" and words
      of similar import when used in any Loan Document shall refer to such Loan
      Document as a whole and not to any particular provision thereof.

            (ii) Article, Section, Exhibit and Schedule references are to the
      Loan Document in which such reference appears.

            (iii) The term "including" is by way of example and not limitation.

            (iv) The term "documents" includes any and all instruments,
      documents, agreements, certificates, notices, reports, financial
      statements and other writings, however evidenced, whether in physical or
      electronic form.

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

      (d) Section headings herein and in the other Loan Documents are included
for convenience of reference only and shall not affect the interpretation of
this Agreement or any other Loan Document.

      1.03 ACCOUNTING TERMS. (a) All accounting terms not specifically or
completely defined herein shall be construed in conformity with, and all
financial data (including financial ratios and other financial calculations)
required to be submitted pursuant to this Agreement shall

                                       17
<PAGE>
be prepared in conformity with, GAAP applied on a consistent basis, as in effect
from time to time, applied in a manner consistent with that used in preparing
the Audited Financial Statements, except as otherwise specifically prescribed
herein.

      (b) If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and either the
Borrower or the Required Lenders shall so request, the Administrative Agent, the
Lenders and the Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrower shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.

      1.04 ROUNDING. Any financial ratios required to be maintained by the
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).

      1.05 REFERENCES TO AGREEMENTS AND LAWS. Unless otherwise expressly
provided herein, (a) references to Organization Documents, agreements (including
the Loan Documents) and other contractual instruments shall be deemed to include
all subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Law shall include all statutory
and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.

      1.06 TIMES OF DAY. Unless otherwise specified, all references herein to
times of day shall be references to Eastern time (daylight or standard, as
applicable).

      1.07 LETTER OF CREDIT AMOUNTS. Unless otherwise specified, all references
herein to the amount of a Letter of Credit at any time shall be deemed to mean
the maximum face amount of such Letter of Credit after giving effect to all
increases thereof contemplated by such Letter of Credit or the Issuer Documents
related thereto, whether or not such maximum face amount is in effect at such
time.

      1.08 ACCOUNTING FOR ACQUISITIONS AND DISPOSITIONS. With respect to any
Acquisition or Disposition consummated on or after the Closing Date, the
following shall apply:

      (a) For each Computation Period following the date of any Acquisition,
Consolidated EBITDA shall include the results of operations of the Person or
assets so acquired on a historical pro forma basis, and which amounts may
include such adjustments as are permitted under Regulation S-X of the SEC and
reasonably satisfactory to the Administrative Agent.

                                       18
<PAGE>
      (b) For each Computation Period following the date of any Acquisition,
Consolidated Interest Expense shall include the results of operations of the
Person or assets so acquired, which amounts shall be determined on a historical
pro forma basis; provided, that, Consolidated Interest Expense shall be adjusted
on a historical pro forma basis to (i) eliminate interest expense accrued during
such period on any Indebtedness repaid in connection with such Acquisition and
(ii) include interest expense on any Indebtedness (including Indebtedness
hereunder) incurred, acquired or assumed in connection with such Acquisition
("Incremental Debt") calculated (x) as if all such Incremental Debt had been
incurred as of the first day of such Computation Period and (y) at the following
interest rates: (I) for all periods subsequent to the date of the Acquisition
and for Incremental Debt assumed or acquired in the Acquisition and in effect
prior to the date of Acquisition, at the actual rates of interest applicable
thereto, and (II) for all periods prior to the actual incurrence of such
Incremental Debt, equal to the average daily rate of interest actually
applicable to such Incremental Debt hereunder or under other financing documents
applicable thereto.

      (c) For each Computation Period following the date of any Disposition,
Consolidated EBITDA shall exclude the results of operations of the Person or
assets so disposed of as if such Disposition occurred on the first day of such
Computation Period.

      (d) For each Computation Period following the date of any Disposition,
Consolidated Interest Expense shall exclude the results of operations of the
Person or assets so disposed of as if such Disposition occurred on the first day
of such Computation Period; provided, that, Consolidated Interest Expense shall
be adjusted on a historical pro forma basis to eliminate interest expense
accrued during such period on any Indebtedness repaid in connection with such
Disposition.

                                  ARTICLE II.
                      THE COMMITMENTS AND CREDIT EXTENSIONS

      2.01 LOANS. Subject to the terms and conditions set forth herein, each
Lender severally agrees to make loans (each such loan, a "Loan") to the Borrower
from time to time, on any Business Day during the Availability Period, in an
aggregate amount not to exceed at any time outstanding the amount of such
Lender's Commitment; provided, however, that after giving effect to any
Borrowing, (i) the Total Outstandings shall not exceed the Aggregate
Commitments, and (ii) the aggregate Outstanding Amount of the Loans of any
Lender, plus such Lender's Pro Rata Share of the Outstanding Amount of all L/C
Obligations shall not exceed such Lender's Commitment. Within the limits of each
Lender's Commitment, and subject to the other terms and conditions hereof, the
Borrower may borrow under this Section 2.01, prepay under Section 2.05, and
reborrow under this Section 2.01. Loans may be Base Rate Loans or Eurodollar
Rate Loans, as further provided herein.

      2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.

      (a) Each Borrowing, each conversion of Loans from one Type to the other,
and each continuation of Eurodollar Rate Loans shall be made upon the Borrower's
irrevocable notice to the Administrative Agent, which may be given by telephone.
Each such notice must be received by the Administrative Agent not later than
11:30 a.m. (i) three Business Days prior to the

                                       19
<PAGE>
requested date of any Borrowing of, conversion to or continuation of Eurodollar
Rate Loans or of any conversion of Eurodollar Rate Loans to Base Rate Loans, and
(ii) on the requested date of any Borrowing of Base Rate Loans. Each telephonic
notice by the Borrower pursuant to this Section 2.02(a) must be confirmed
promptly by delivery to the Administrative Agent of a written Loan Notice,
appropriately completed and signed by a Responsible Officer. Each Borrowing of,
conversion to or continuation of Eurodollar Rate Loans shall be in a principal
amount of $1,000,000 or a whole multiple of $500,000 in excess thereof. Except
as provided in Section 2.03(c), each Borrowing of or conversion to Base Rate
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000
in excess thereof. Each Loan Notice (whether telephonic or written) shall
specify (i) whether the Borrower is requesting a Borrowing, a conversion of
Loans from one Type to the other, or a continuation of Eurodollar Rate Loans,
(ii) the requested date of the Borrowing, conversion or continuation, as the
case may be (which shall be a Business Day), (iii) the principal amount of Loans
to be borrowed, converted or continued, (iv) the Type of Loans to be borrowed or
to which existing Loans are to be converted, and (v) if applicable, the duration
of the Interest Period with respect thereto. If the Borrower fails to specify a
Type of Loan in a Loan Notice or if the Borrower fails to give a timely notice
requesting a conversion or continuation, then the applicable Loans shall be made
as, or converted to, Base Rate Loans. Any such automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans. If the Borrower
requests a Borrowing of, conversion to, or continuation of Eurodollar Rate Loans
in any such Loan Notice, but fails to specify an Interest Period, it will be
deemed to have specified an Interest Period of one month.

      (b) Following receipt of a Loan Notice, the Administrative Agent shall
promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Loans, and if no timely notice of a conversion or continuation is
provided by the Borrower, the Administrative Agent shall notify each Lender of
the details of any automatic conversion to Base Rate Loans described in the
preceding subsection. In the case of a Borrowing, each Lender shall make the
amount of its Loan available to the Administrative Agent in immediately
available funds at the Administrative Agent's Office not later than 1:30 p.m. on
the Business Day specified in the applicable Loan Notice. Upon satisfaction of
the applicable conditions set forth in Section 4.02 (and, if such Borrowing is
the initial Credit Extension, Section 4.01), the Administrative Agent shall make
all funds so received available to the Borrower in like funds as received by the
Administrative Agent either by (i) crediting the account of the Borrower on the
books of Bank of America with the amount of such funds or (ii) wire transfer of
such funds, in each case in accordance with instructions provided to (and
reasonably acceptable to) the Administrative Agent by the Borrower; provided,
however, that if, on the date the Loan Notice with respect to such Borrowing is
given by the Borrower, there are L/C Borrowings outstanding, then the proceeds
of such Borrowing, first, shall be applied to the payment in full of any such
L/C Borrowings and, second, shall be made available to the Borrower as provided
above.

      (c) Except as otherwise provided herein, a Eurodollar Rate Loan may be
continued or converted only on the last day of an Interest Period for such
Eurodollar Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurodollar Rate Loans without the
consent of the Required Lenders.

                                       20
<PAGE>
      (d) The Administrative Agent shall promptly notify the Borrower and the
Lenders of the interest rate applicable to any Interest Period for Eurodollar
Rate Loans upon determination of such interest rate. The determination of the
Eurodollar Rate by the Administrative Agent shall be conclusive in the absence
of manifest error. At any time that Base Rate Loans are outstanding, the
Administrative Agent shall notify the Borrower and the Lenders of any change in
Bank of America's prime rate used in determining the Base Rate promptly
following the public announcement of such change.

      (e) After giving effect to all Borrowings, all conversions of Loans from
one Type to the other, and all continuations of Loans as the same Type, there
shall not be more than 15 Interest Periods in effect with respect to Loans.

      2.03 LETTERS OF CREDIT.

      (a) The Letter of Credit Commitment.

            (i) Subject to the terms and conditions set forth herein, (A) the
      L/C Issuer agrees, in reliance upon the agreements of the other Lenders
      set forth in this Section 2.03, (1) from time to time on any Business Day
      during the period from the Closing Date until the Letter of Credit
      Expiration Date, to issue Letters of Credit for the account of the
      Borrower or its Subsidiaries, and to amend or extend Letters of Credit
      previously issued by it, in accordance with subsection (b) below, and (2)
      to honor drawings under the Letters of Credit; and (B) the Lenders
      severally agree to participate in Letters of Credit issued for the account
      of the Borrower or its Subsidiaries and any drawings thereunder; provided
      that after giving effect to any L/C Credit Extension with respect to any
      Letter of Credit, (x) the Total Outstandings shall not exceed the
      Aggregate Commitments, (y) the aggregate Outstanding Amount of the Loans
      of any Lender, plus such Lender's Pro Rata Share of the Outstanding Amount
      of all L/C Obligations shall not exceed such Lender's Commitment, and (z)
      the Outstanding Amount of the L/C Obligations shall not exceed the Letter
      of Credit Sublimit. Each request by the Borrower for the issuance or
      amendment of a Letter of Credit shall be deemed to be a representation by
      the Borrower that the L/C Credit Extension so requested complies with the
      conditions set forth in the proviso to the preceding sentence. Within the
      foregoing limits, and subject to the terms and conditions hereof, the
      Borrower's ability to obtain Letters of Credit shall be fully revolving,
      and accordingly the Borrower may, during the foregoing period, obtain
      Letters of Credit to replace Letters of Credit that have expired or that
      have been drawn upon and reimbursed. All Existing Letters of Credit shall
      be deemed to have been issued pursuant hereto, and from and after the
      Closing Date shall be subject to and governed by the terms and conditions
      hereof.

            (ii) The L/C Issuer shall not issue any Letter of Credit, if:

                  (A) subject to Section 2.03(b)(iii), the expiry date of such
            requested Letter of Credit would occur more than twelve months after
            the date of issuance or last extension, unless the Required Lenders
            have approved such expiry date; or

                                       21
<PAGE>
                  (B) the expiry date of such requested Letter of Credit would
            occur after the Letter of Credit Expiration Date, unless all the
            Lenders have approved such expiry date.

            (iii) The L/C Issuer shall not be under any obligation to issue any
      Letter of Credit if:

                  (A) any order, judgment or decree of any Governmental
            Authority or arbitrator shall by its terms purport to enjoin or
            restrain the L/C Issuer from issuing such Letter of Credit, or any
            Law applicable to the L/C Issuer or any request or directive
            (whether or not having the force of law) from any Governmental
            Authority with jurisdiction over the L/C Issuer shall prohibit, or
            request that the L/C Issuer refrain from, the issuance of letters of
            credit generally or such Letter of Credit in particular or shall
            impose upon the L/C Issuer with respect to such Letter of Credit any
            restriction, reserve or capital requirement (for which the L/C
            Issuer is not otherwise compensated hereunder) not in effect on the
            Closing Date, or shall impose upon the L/C Issuer any unreimbursed
            loss, cost or expense which was not applicable on the Closing Date
            and which the L/C Issuer in good faith deems material to it;

                  (B) the issuance of such Letter of Credit would violate any
            Laws or one or more policies of the L/C Issuer;

                  (C) except as otherwise agreed by the Administrative Agent and
            the L/C Issuer, such Letter of Credit is in an initial face amount
            less than $100,000;

                  (D) such Letter of Credit is to be denominated in a currency
            other than Dollars;

                  (E) such Letter of Credit contains any provisions for
            automatic reinstatement of the stated amount after any drawing
            thereunder; or

                  (F) a default of any Lender's obligations to fund under
            Section 2.03(c) exists or any Lender is at such time a Defaulting
            Lender hereunder, unless the L/C Issuer has entered into
            satisfactory arrangements with the Borrower or such Lender to
            eliminate the L/C Issuer's risk with respect to such Lender.

            (iv) The L/C Issuer shall not amend any Letter of Credit if the L/C
      Issuer would not be permitted at such time to issue such Letter of Credit
      in its amended form under the terms hereof.

            (v) The L/C Issuer shall be under no obligation to amend any Letter
      of Credit if (A) the L/C Issuer would have no obligation at such time to
      issue such Letter of Credit in its amended form under the terms hereof, or
      (B) the beneficiary of such Letter of Credit does not accept the proposed
      amendment to such Letter of Credit.

                                       22
<PAGE>
      (b) Procedures for Issuance and Amendment of Letters of Credit;
Auto-Extension Letters of Credit.

            (i) Each Letter of Credit shall be issued or amended, as the case
      may be, upon the request of the Borrower delivered to the L/C Issuer (with
      a copy to the Administrative Agent) in the form of a Letter of Credit
      Application, appropriately completed and signed by a Responsible Officer.
      Such Letter of Credit Application must be received by the L/C Issuer and
      the Administrative Agent not later than 11:00 a.m. at least two Business
      Days (or such later date and time as the Administrative Agent and the L/C
      Issuer may agree in a particular instance in their sole discretion) prior
      to the proposed issuance date or date of amendment, as the case may be. In
      the case of a request for an initial issuance of a Letter of Credit, such
      Letter of Credit Application shall specify in form and detail satisfactory
      to the L/C Issuer: (A) the proposed issuance date of the requested Letter
      of Credit (which shall be a Business Day); (B) the amount thereof; (C) the
      expiry date thereof; (D) the name and address of the beneficiary thereof;
      (E) the documents to be presented by such beneficiary in case of any
      drawing thereunder; (F) the full text of any certificate to be presented
      by such beneficiary in case of any drawing thereunder; and (G) such other
      matters as the L/C Issuer may require. In the case of a request for an
      amendment of any outstanding Letter of Credit, such Letter of Credit
      Application shall specify in form and detail satisfactory to the L/C
      Issuer (A) the Letter of Credit to be amended; (B) the proposed date of
      amendment thereof (which shall be a Business Day); (C) the nature of the
      proposed amendment; and (D) such other matters as the L/C Issuer may
      require. Additionally, the Borrower shall furnish to the L/C Issuer and
      the Administrative Agent such other documents and information pertaining
      to such requested Letter of Credit issuance or amendment, including any
      Issuer Documents, as the L/C Issuer or the Administrative Agent may
      require.

            (ii) Promptly after receipt of any Letter of Credit Application, the
      L/C Issuer will confirm with the Administrative Agent (by telephone or in
      writing) that the Administrative Agent has received a copy of such Letter
      of Credit Application from the Borrower and, if not, the L/C Issuer will
      provide the Administrative Agent with a copy thereof. Unless the L/C
      Issuer has received written notice from any Lender, the Administrative
      Agent or the Borrower, at least one Business Day prior to the requested
      date of issuance or amendment of the applicable Letter of Credit, that one
      or more applicable conditions contained in Article IV shall not then be
      satisfied, then, subject to the terms and conditions hereof, the L/C
      Issuer shall, on the requested date, issue a Letter of Credit for the
      account of the Borrower (or the applicable Subsidiary) or enter into the
      applicable amendment, as the case may be, in each case in accordance with
      the L/C Issuer's usual and customary business practices. Immediately upon
      the issuance of each Letter of Credit, each Lender shall be deemed to, and
      hereby irrevocably and unconditionally agrees to, purchase from the L/C
      Issuer a risk participation in such Letter of Credit in an amount equal to
      the product of such Lender's Pro Rata Share times the amount of such
      Letter of Credit.

            (iii) If the Borrower so requests in any applicable Letter of Credit
      Application, the L/C Issuer may, in its sole and absolute discretion,
      agree to issue a Letter of Credit that has automatic extension provisions
      (each, an "Auto-Extension Letter of Credit");

                                       23
<PAGE>
      provided that any such Auto-Extension Letter of Credit must permit the L/C
      Issuer to prevent any such extension at least once in each twelve-month
      period (commencing with the date of issuance of such Letter of Credit) by
      giving prior notice to the beneficiary thereof not later than a day (the
      "Non-Extension Notice Date") in each such twelve-month period to be agreed
      upon at the time such Letter of Credit is issued. Unless otherwise
      directed by the L/C Issuer, the Borrower shall not be required to make a
      specific request to the L/C Issuer for any such extension. Once an
      Auto-Extension Letter of Credit has been issued, the Lenders shall be
      deemed to have authorized (but may not require) the L/C Issuer to permit
      the extension of such Letter of Credit at any time to an expiry date not
      later than the Letter of Credit Expiration Date; provided, however, that
      the L/C Issuer shall not permit any such extension if (A) the L/C Issuer
      has determined that it would not be permitted, or would have no obligation
      at such time to issue such Letter of Credit in its revised form (as
      extended) under the terms hereof (by reason of the provisions of clause
      (ii) or (iii) of Section 2.03(a) or otherwise), or (B) it has received
      notice (which may be by telephone or in writing) on or before the day that
      is five Business Days before the Non-Extension Notice Date (1) from the
      Administrative Agent that the Required Lenders have elected not to permit
      such extension or (2) from the Administrative Agent, any Lender or the
      Borrower that one or more of the applicable conditions specified in
      Section 4.02 is not then satisfied, and in each such case directing the
      L/C Issuer not to permit such extension.

            (iv) Promptly after its delivery of any Letter of Credit or any
      amendment to a Letter of Credit to an advising bank with respect thereto
      or to the beneficiary thereof, the L/C Issuer will also deliver to the
      Borrower and the Administrative Agent a true and complete copy of such
      Letter of Credit or amendment.

      (c) Drawings and Reimbursements; Funding of Participations.

            (i) Upon receipt from the beneficiary of any Letter of Credit of any
      notice of a drawing under such Letter of Credit, the L/C Issuer shall
      notify the Borrower and the Administrative Agent thereof. Not later than
      11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of
      Credit (each such date, an "Honor Date"), the Borrower shall reimburse the
      L/C Issuer through the Administrative Agent in an amount equal to the
      amount of such drawing. If the Borrower fails to so reimburse the L/C
      Issuer by such time, the Administrative Agent shall promptly notify each
      Lender of the Honor Date, the amount of the unreimbursed drawing (the
      "Unreimbursed Amount"), and the amount of such Lender's Pro Rata Share
      thereof. In such event, the Borrower shall be deemed to have requested a
      Borrowing of Base Rate Loans to be disbursed on the Honor Date in an
      amount equal to the Unreimbursed Amount, without regard to the minimum and
      multiples specified in Section 2.02 for the principal amount of Base Rate
      Loans, but subject to the amount of the unutilized portion of the
      Aggregate Commitments and the conditions set forth in Section 4.02 (other
      than the delivery of a Loan Notice). Any notice given by the L/C Issuer or
      the Administrative Agent pursuant to this Section 2.03(c)(i) may be given
      by telephone if immediately confirmed in writing; provided that the lack
      of such an immediate confirmation shall not affect the conclusiveness or
      binding effect of such notice.

                                       24
<PAGE>
            (ii) Each Lender (including the Lender acting as L/C Issuer) shall
      upon any notice pursuant to Section 2.03(c)(i) make funds available to the
      Administrative Agent for the account of the L/C Issuer at the
      Administrative Agent's Office in an amount equal to its Pro Rata Share of
      the Unreimbursed Amount not later than 1:00 p.m. on the Business Day
      specified in such notice by the Administrative Agent, whereupon, subject
      to the provisions of Section 2.03(c)(iii), each Lender that so makes funds
      available shall be deemed to have made a Base Rate Loan to the Borrower in
      such amount. The Administrative Agent shall remit the funds so received to
      the L/C Issuer.

            (iii) With respect to any Unreimbursed Amount that is not fully
      refinanced by a Borrowing of Base Rate Loans because the conditions set
      forth in Section 4.02 cannot be satisfied or for any other reason, the
      Borrower shall be deemed to have incurred from the L/C Issuer an L/C
      Borrowing in the amount of the Unreimbursed Amount that is not so
      refinanced, which L/C Borrowing shall be due and payable on demand
      (together with interest) and shall bear interest at the Default Rate. In
      such event, each Lender's payment to the Administrative Agent for the
      account of the L/C Issuer pursuant to Section 2.03(c)(ii) shall be deemed
      payment in respect of its participation in such L/C Borrowing and shall
      constitute an L/C Advance from such Lender in satisfaction of its
      participation obligation under this Section 2.03.

            (iv) Until each Lender funds its Loan or L/C Advance pursuant to
      this Section 2.03(c) to reimburse the L/C Issuer for any amount drawn
      under any Letter of Credit, interest in respect of such Lender's Pro Rata
      Share of such amount shall be solely for the account of the L/C Issuer.

            (v) Each Lender's obligation to make Loans or L/C Advances to
      reimburse the L/C Issuer for amounts drawn under Letters of Credit, as
      contemplated by this Section 2.03(c), shall be absolute and unconditional
      and shall not be affected by any circumstance, including (A) any set-off,
      counterclaim, recoupment, defense or other right which such Lender may
      have against the L/C Issuer, the Borrower or any other Person for any
      reason whatsoever; (B) the occurrence or continuance of a Default, or (C)
      any other occurrence, event or condition, whether or not similar to any of
      the foregoing; provided, however, that each Lender's obligation to make
      Loans (but not L/C Advances) pursuant to this Section 2.03(c) is subject
      to the conditions set forth in Section 4.02 (other than delivery by the
      Borrower of a Loan Notice). No such making of an L/C Advance shall relieve
      or otherwise impair the obligation of the Borrower to reimburse the L/C
      Issuer for the amount of any payment made by the L/C Issuer under any
      Letter of Credit, together with interest as provided herein.

            (vi) If any Lender fails to make available to the Administrative
      Agent for the account of the L/C Issuer any amount required to be paid by
      such Lender pursuant to the foregoing provisions of this Section 2.03(c)
      by the time specified in Section 2.03(c)(ii), the L/C Issuer shall be
      entitled to recover from such Lender (acting through the Administrative
      Agent), on demand, such amount with interest thereon for the period from
      the date such payment is required to the date on which such payment is
      immediately available to the L/C Issuer at a rate per annum equal to the
      Federal Funds Rate from time to time in effect. A certificate of the L/C
      Issuer submitted to any Lender (through the

                                       25
<PAGE>
      Administrative Agent) with respect to any amounts owing under this clause
      (vi) shall be conclusive absent manifest error.

      (d) Repayment of Participations.

            (i) At any time after the L/C Issuer has made a payment under any
      Letter of Credit and has received from any Lender such Lender's L/C
      Advance in respect of such payment in accordance with Section 2.03(c), if
      the Administrative Agent receives for the account of the L/C Issuer any
      payment in respect of the related Unreimbursed Amount or interest thereon
      (whether directly from the Borrower or otherwise, including proceeds of
      Cash Collateral applied thereto by the Administrative Agent), the
      Administrative Agent will distribute to such Lender its Pro Rata Share
      thereof (appropriately adjusted, in the case of interest payments, to
      reflect the period of time during which such Lender's L/C Advance was
      outstanding) in the same funds as those received by the Administrative
      Agent.

            (ii) If any payment received by the Administrative Agent for the
      account of the L/C Issuer pursuant to Section 2.03(c)(i) is required to be
      returned under any of the circumstances described in Section 10.06
      (including pursuant to any settlement entered into by the L/C Issuer in
      its discretion), each Lender shall pay to the Administrative Agent for the
      account of the L/C Issuer its Pro Rata Share thereof on demand of the
      Administrative Agent, plus interest thereon from the date of such demand
      to the date such amount is returned by such Lender, at a rate per annum
      equal to the Federal Funds Rate from time to time in effect.

      (e) Obligations Absolute. The obligation of the Borrower to reimburse the
L/C Issuer for each drawing under each Letter of Credit and to repay each L/C
Borrowing shall be absolute, unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including the following:

            (i) any lack of validity or enforceability of such Letter of Credit,
      this Agreement, or any other Loan Document;

            (ii) the existence of any claim, counterclaim, set-off, defense or
      other right that the Borrower or any Subsidiary may have at any time
      against any beneficiary or any transferee of such Letter of Credit (or any
      Person for whom any such beneficiary or any such transferee may be
      acting), the L/C Issuer or any other Person, whether in connection with
      this Agreement, the transactions contemplated hereby or by such Letter of
      Credit or any agreement or instrument relating thereto, or any unrelated
      transaction;

            (iii) any draft, demand, certificate or other document presented
      under such Letter of Credit proving to be forged, fraudulent, invalid or
      insufficient in any respect or any statement therein being untrue or
      inaccurate in any respect; or any loss or delay in the transmission or
      otherwise of any document required in order to make a drawing under such
      Letter of Credit;

            (iv) any payment by the L/C Issuer under such Letter of Credit
      against presentation of a draft or certificate that does not strictly
      comply with the terms of such

                                       26
<PAGE>
      Letter of Credit; or any payment made by the L/C Issuer under such Letter
      of Credit to any Person purporting to be a trustee in bankruptcy,
      debtor-in-possession, assignee for the benefit of creditors, liquidator,
      receiver or other representative of or successor to any beneficiary or any
      transferee of such Letter of Credit, including any arising in connection
      with any proceeding under any Debtor Relief Law; or

            (v) any other circumstance or happening whatsoever, whether or not
      similar to any of the foregoing, including any other circumstance that
      might otherwise constitute a defense available to, or a discharge of, the
      Borrower or any Subsidiary.

      The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.

      (f) Role of L/C Issuer. Each Lender and the Borrower agree that, in paying
any drawing under a Letter of Credit, the L/C Issuer shall not have any
responsibility to obtain any document (other than any sight draft, certificates
and documents expressly required by the Letter of Credit) or to ascertain or
inquire as to the validity or accuracy of any such document or the authority of
the Person executing or delivering any such document. None of the L/C Issuer,
any Agent-Related Person nor any of the respective correspondents, participants
or assignees of the L/C Issuer shall be liable to any Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of
the Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit Application. The
Borrower hereby assumes all risks of the acts or omissions of any beneficiary or
transferee with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude the Borrower's
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement. None of the L/C Issuer, any
Agent-Related Person, nor any of the respective correspondents, participants or
assignees of the L/C Issuer, shall be liable or responsible for any of the
matters described in clauses (i) through (v) of Section 2.03(e); provided,
however, that anything in such clauses to the contrary notwithstanding, the
Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be
liable to the Borrower, to the extent, but only to the extent, of any direct, as
opposed to consequential or exemplary, damages suffered by the Borrower which
the Borrower proves were caused by the L/C Issuer's willful misconduct or gross
negligence or the L/C Issuer's willful failure to pay under any Letter of Credit
after the presentation to it by the beneficiary of a sight draft and
certificate(s) strictly complying with the terms and conditions of a Letter of
Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer
may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary, and the L/C Issuer shall not be responsible for the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason.

                                       27
<PAGE>
      (g) Cash Collateral. Upon the request of the Administrative Agent or the
Required Lenders, (i) if the L/C Issuer has honored any full or partial drawing
request under any Letter of Credit and such drawing has resulted in an L/C
Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any Letter of
Credit for any reason remains outstanding and partially or wholly undrawn, the
Borrower shall immediately Cash Collateralize the then Outstanding Amount of all
L/C Obligations (in an amount equal to such Outstanding Amount determined as of
the date of such L/C Borrowing or the Letter of Credit Expiration Date, as the
case may be). Sections 2.05 and 8.02(c) set forth certain additional
requirements to deliver Cash Collateral hereunder. For purposes of this Section
2.03, Section 2.05 and Section 8.02(c), "Cash Collateralize" means to pledge and
deposit with or deliver to the Administrative Agent, for the benefit of the L/C
Issuer and the Lenders, as collateral for the L/C Obligations, cash or deposit
account balances pursuant to documentation in form and substance satisfactory to
the Administrative Agent and the L/C Issuer (which documents are hereby
consented to by the Lenders). Derivatives of such term have corresponding
meanings. The Borrower hereby grants to the Administrative Agent, for the
benefit of the L/C Issuer and the Lenders, a security interest in all such cash,
deposit accounts and all balances therein and all proceeds of the foregoing.
Cash Collateral shall be maintained in blocked, interest bearing deposit
accounts at Bank of America.

      (h) Applicability of ISP. Unless otherwise expressly agreed by the L/C
Issuer and the Borrower when a Letter of Credit is issued (including any such
agreement applicable to an Existing Letter of Credit), the rules of the ISP
shall apply to each Letter of Credit.

      (i) Letter of Credit Fees. The Borrower shall pay to the Administrative
Agent for the account of each Lender in accordance with its Pro Rata Share a
Letter of Credit fee (the "Letter of Credit Fee") for each Letter of Credit
equal to the Applicable Rate times the daily maximum amount available to be
drawn under such Letter of Credit (whether or not such maximum amount is then in
effect under such Letter of Credit). Letter of Credit Fees shall be (i) computed
on a quarterly basis in arrears and (ii) due and payable on the first Business
Day after the end of each March, June, September and December, commencing with
the first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand. If there is any
change in the Applicable Rate during any quarter, the daily maximum amount of
each Letter of Credit shall be computed and multiplied by the Applicable Rate
separately for each period during such quarter that such Applicable Rate was in
effect. Notwithstanding anything to the contrary contained herein, while any
Event of Default exists, all Letter of Credit Fees shall accrue at the Default
Rate.

      (j) Fronting Fee and Documentary and Processing Charges Payable to L/C
Issuer. The Borrower shall pay directly to each L/C Issuer for its own account a
fronting fee with respect to each Letter of Credit issued or deemed issued by it
in the amount specified in the Fee Letter to which it is a party, payable on the
actual daily maximum amount available to be drawn under such Letter of Credit
(whether or not such maximum amount is then in effect under such Letter of
Credit). Such fronting fee shall be computed on a quarterly basis in arrears.
Such fronting fee shall be due and payable on the first Business Day after the
end of each March, June, September and December, commencing with the first such
date to occur after the issuance of such Letter of Credit, on the Letter of
Credit Expiration Date and thereafter on demand. In addition, the Borrower shall
pay directly to the L/C Issuer for its own account the customary issuance,
presentation, amendment and other processing fees, and other standard costs and

                                       28
<PAGE>
charges, of the L/C Issuer relating to letters of credit as from time to time in
effect. Such customary fees and standard costs and charges are due and payable
on demand and are nonrefundable.

      (k) Conflict with Issuer Documents. In the event of any conflict between
the terms hereof and the terms of any Issuer Document, the terms hereof shall
control.

      (l) Letters of Credit Issued for Subsidiaries. Notwithstanding that a
Letter of Credit issued or outstanding hereunder is in support of any
obligations of, or is for the account of, a Subsidiary, the Borrower shall be
obligated to reimburse the L/C Issuer hereunder for any and all drawings under
such Letter of Credit. The Borrower hereby acknowledges that the issuance of
Letters of Credit for the account of Subsidiaries inures to the benefit of the
Borrower, and that the Borrower's business derives substantial benefits from the
businesses of such Subsidiaries.

      (m) Reporting of Letter of Credit Information. On (i) the last Business
Day of each calendar month, and (ii) each date that an L/C Credit Extension
occurs with respect to any Letter of Credit, the L/C Issuer shall deliver to the
Administrative Agent a report in the form of Exhibit F hereto, appropriately
completed with the information for every Letter of Credit issued by the L/C
Issuer that is outstanding hereunder.

      2.04 [INTENTIONALLY OMITTED].

      2.05 PREPAYMENTS.

      (a) The Borrower may, upon notice to the Administrative Agent, at any time
or from time to time voluntarily prepay Loans in whole or in part without
premium or penalty; provided that (i) such notice must be received by the
Administrative Agent not later than 11:00 a.m. (A) three Business Days prior to
any date of prepayment of Eurodollar Rate Loans and (B) on the date of
prepayment of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans
shall be in a principal amount of $1,000,000 or a whole multiple of $500,000 in
excess thereof; and (iii) any prepayment of Base Rate Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess thereof
(or, in the case of Base Rate Loans resulting from a Borrowing under Section
2.03(c), such lesser amount as will reduce the aggregate amount of outstanding
Base Rate Loans to a principal amount of $500,000 or a whole multiple of
$100,000 in excess thereof) or, in each case, if less, the entire principal
amount thereof then outstanding. Each such notice shall specify the date and
amount of such prepayment and the Type(s) of Loans to be prepaid. The
Administrative Agent will promptly notify each Lender of its receipt of each
such notice, and of the amount of such Lender's Pro Rata Share of such
prepayment. If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest thereon, together with any
additional amounts required pursuant to Section 3.05. Each such prepayment shall
be applied to the Loans of the Lenders in accordance with their respective Pro
Rata Shares.

      (b) If for any reason the Total Outstandings at any time exceed the
Aggregate Commitments then in effect, the Borrower shall immediately prepay
Loans in an aggregate amount equal to such excess or, if the amount of such
excess exceeds the outstanding Loans,

                                       29
<PAGE>
shall prepay all outstanding Loans and then Cash Collateralize the L/C
Obligations in an amount sufficient to cause the Total Outstandings to not
exceed the Aggregate Commitments then in effect.

      2.06 TERMINATION OR REDUCTION OF COMMITMENTS. The Borrower may, upon
notice to the Administrative Agent, terminate the Aggregate Commitments, or from
time to time permanently reduce the Aggregate Commitments; provided that (i) any
such notice shall be received by the Administrative Agent not later than 11:30
a.m. three Business Days prior to the date of termination or reduction, (ii) any
such partial reduction shall be in an aggregate amount of $10,000,000 or any
whole multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not
terminate or reduce the Aggregate Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Outstandings would exceed
the Aggregate Commitments, and (iv) if, after giving effect to any reduction of
the Aggregate Commitments, the Letter of Credit Sublimit exceeds the amount of
the Aggregate Commitments, such Sublimit shall be automatically reduced by the
amount of such excess. The Administrative Agent will promptly notify the Lenders
of any such notice of termination or reduction of the Aggregate Commitments. Any
reduction of the Aggregate Commitments shall be applied to the Commitment of
each Lender according to its Pro Rata Share. All fees accrued until the
effective date of any termination of the Aggregate Commitments shall be paid on
the effective date of such termination.

      2.07 REPAYMENT OF LOANS. The Borrower shall repay to the Lenders on the
Maturity Date the aggregate principal amount of Loans outstanding on such date.

      2.08 INTEREST.

      (a) Subject to the provisions of subsection (b) below, (i) each Eurodollar
Rate Loan shall bear interest on the outstanding principal amount thereof for
each Interest Period at a rate per annum equal to the Eurodollar Rate for such
Interest Period plus the Applicable Rate; and (ii) each Base Rate Loan shall
bear interest on the outstanding principal amount thereof from the applicable
borrowing date at a rate per annum equal to the Base Rate.

      (b)   (i) If any amount of principal of any Loan is not paid when due
      (without regard to any applicable grace periods), whether at stated
      maturity, by acceleration or otherwise, such amount shall thereafter bear
      interest at a fluctuating interest rate per annum at all times equal to
      the Default Rate to the fullest extent permitted by applicable Laws.

            (ii) If any amount (other than principal of any Loan) payable by the
      Borrower under any Loan Document is not paid when due (without regard to
      any applicable grace periods), whether at stated maturity, by acceleration
      or otherwise, then upon the request of the Required Lenders, such amount
      shall thereafter bear interest at a fluctuating interest rate per annum at
      all times equal to the Default Rate to the fullest extent permitted by
      applicable Laws.

            (iii) Upon the request of the Required Lenders, while any Event of
      Default exists, the Borrower shall pay interest on the principal amount of
      all outstanding

                                       30
<PAGE>
      Obligations hereunder at a fluctuating interest rate per annum at all
      times equal to the Default Rate to the fullest extent permitted by
      applicable Laws.

            (iv) Accrued and unpaid interest on past due amounts (including
      interest on past due interest) shall be due and payable upon demand.

      (c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.

      2.09 FEES. In addition to certain fees described in subsections (i) and
(j) of Section 2.03:

      (a) FACILITY FEE. The Borrower shall pay to the Administrative Agent for
the account of each Lender in accordance with its Pro Rata Share, a facility fee
equal to the Applicable Rate times the actual daily amount of the Aggregate
Commitments (or, if the Aggregate Commitments have terminated, on the
Outstanding Amount of all Loans and L/C Obligations), regardless of usage. The
facility fee shall accrue at all times during the Availability Period (and
thereafter so long as any Loans or L/C Obligations remain outstanding),
including at any time during which one or more of the conditions in Article IV
is not met, and shall be due and payable quarterly in arrears on the last
Business Day of each March, June, September and December, commencing with the
first such date to occur after the Closing Date, and on the Maturity Date (and,
if applicable, thereafter on demand). The facility fee shall be calculated
quarterly in arrears, and if there is any change in the Applicable Rate during
any quarter, the actual daily amount shall be computed and multiplied by the
Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.

      (b) OTHER FEES. (i) The Borrower shall pay to each Arranger, Bank of
America, Bank One and the Administrative Agent for their own respective accounts
fees in the amounts and at the times specified in the Fee Letters. Such fees
shall be fully earned when paid and shall not be refundable for any reason
whatsoever.

      (ii) The Borrower shall pay to the Lenders such fees as shall have been
separately agreed upon in writing in the amounts and at the times so specified.
Such fees shall be fully earned when paid and shall not be refundable for any
reason whatsoever.

      2.10 COMPUTATION OF INTEREST AND FEES. All computations of interest for
Base Rate Loans when the Base Rate is determined by Bank of America's "prime
rate" shall be made on the basis of a year of 365 or 366 days, as the case may
be, and actual days elapsed. All other computations of fees and interest shall
be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis
of a 365-day year). Interest shall accrue on each Loan for the day on which the
Loan is made, and shall not accrue on a Loan, or any portion thereof, for the
day on which the Loan or such portion is paid, provided that any Loan that is
repaid on the same day on which it is made shall, subject to Section 2.12(a),
bear interest for one day.

                                       31
<PAGE>
      2.11 EVIDENCE OF DEBT.

      (a) The Credit Extensions made by each Lender shall be evidenced by one or
more accounts or records maintained by such Lender and by the Administrative
Agent in the ordinary course of business. The accounts or records maintained by
the Administrative Agent and each Lender shall be conclusive absent manifest
error of the amount of the Credit Extensions made by the Lenders to the Borrower
and the interest and payments thereon. Any failure to so record or any error in
doing so shall not, however, limit or otherwise affect the obligation of the
Borrower hereunder to pay any amount owing with respect to the Obligations. In
the event of any conflict between the accounts and records maintained by any
Lender and the accounts and records of the Administrative Agent in respect of
such matters, the accounts and records of the Administrative Agent shall control
in the absence of manifest error. Upon the request of any Lender made through
the Administrative Agent, the Borrower shall execute and deliver to such Lender
(through the Administrative Agent) a Note, which shall evidence such Lender's
Loans in addition to such accounts or records. Each Lender may attach schedules
to its Note and endorse thereon the date, Type (if applicable), amount and
maturity of its Loans and payments with respect thereto.

      (b) In addition to the accounts and records referred to in subsection (a),
each Lender and the Administrative Agent shall maintain in accordance with its
usual practice accounts or records evidencing the purchases and sales by such
Lender of participations in Letters of Credit. In the event of any conflict
between the accounts and records maintained by the Administrative Agent and the
accounts and records of any Lender in respect of such matters, the accounts and
records of the Administrative Agent shall control in the absence of manifest
error.

      2.12 PAYMENTS GENERALLY.

      (a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in immediately available funds not later than 2:00 p.m. on
the date specified herein. The Administrative Agent will promptly distribute to
each Lender its Pro Rata Share (or other applicable share as provided herein) of
such payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by the Administrative Agent after 2:00 p.m. shall
be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue.

      (b) If any payment to be made by the Borrower shall come due on a day
other than a Business Day, payment shall be made on the next following Business
Day, and such extension of time shall be reflected in computing interest or
fees, as the case may be.

      (c) Unless the Borrower or any Lender has notified the Administrative
Agent, prior to the date any payment is required to be made by it to the
Administrative Agent hereunder, that the Borrower or such Lender, as the case
may be, will not make such payment, the Administrative Agent may assume that the
Borrower or such Lender, as the case may be, has timely made such payment and
may (but shall not be so required to), in reliance thereon, make available a

                                       32
<PAGE>
corresponding amount to the Person entitled thereto. If and to the extent that
such payment was not in fact made to the Administrative Agent in immediately
available funds, then:

            (i) if the Borrower failed to make such payment, each Lender shall
      forthwith on demand repay to the Administrative Agent the portion of such
      assumed payment that was made available to such Lender in immediately
      available funds, together with interest thereon in respect of each day
      from the date such amount was made available by the Administrative Agent
      to such Lender to the date such amount is repaid to the Administrative
      Agent in immediately available funds at the Federal Funds Rate from time
      to time in effect; and

            (ii) if any Lender failed to make such payment, such Lender shall
      forthwith on demand pay to the Administrative Agent the amount thereof in
      immediately available funds, together with interest thereon for the period
      from the date such amount was made available by the Administrative Agent
      to the Borrower to the date such amount is recovered by the Administrative
      Agent (the "Compensation Period") at a rate per annum equal to the Federal
      Funds Rate from time to time in effect. If such Lender pays such amount to
      the Administrative Agent, then such amount shall constitute such Lender's
      Loan included in the applicable Borrowing. If such Lender does not pay
      such amount forthwith upon the Administrative Agent's demand therefor, the
      Administrative Agent may make a demand therefor upon the Borrower, and the
      Borrower shall pay such amount to the Administrative Agent, together with
      interest thereon for the Compensation Period at a rate per annum equal to
      the rate of interest applicable to the applicable Borrowing. Nothing
      herein shall be deemed to relieve any Lender from its obligation to
      fulfill its Commitment or to prejudice any rights which the Administrative
      Agent or the Borrower may have against any Lender as a result of any
      default by such Lender hereunder.

      A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.

      (d) If any Lender makes available to the Administrative Agent funds for
any Loan to be made by such Lender as provided in the foregoing provisions of
this Article II, and such funds are not made available to the Borrower by the
Administrative Agent because the conditions to the applicable Credit Extension
set forth in Article IV are not satisfied or waived in accordance with the terms
hereof, the Administrative Agent shall return such funds (in like funds as
received from such Lender) to such Lender, without interest.

      (e) The obligations of the Lenders hereunder to make Loans and to fund
participations in Letters of Credit are several and not joint. The failure of
any Lender to make any Loan or to fund any such participation on any date
required hereunder shall not relieve any other Lender of its corresponding
obligation to do so on such date, and no Lender shall be responsible for the
failure of any other Lender to so make its Loan or purchase its participation.

      (f) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.

                                       33
<PAGE>
      2.13 SHARING OF PAYMENTS. If, other than as expressly provided elsewhere
herein, any Lender shall obtain on account of the Loans made by it, or the
participations in L/C Obligations held by it, any payment (whether voluntary,
involuntary, through the exercise of any right of set-off, or otherwise) in
excess of its ratable share (or other share contemplated hereunder) thereof,
such Lender shall immediately (a) notify the Administrative Agent of such fact,
and (b) purchase from the other Lenders such participations in the Loans made by
them and/or such subparticipations in the participations in L/C Obligations held
by them, as the case may be, as shall be necessary to cause such purchasing
Lender to share the excess payment in respect of such Loans or such
participations, as the case may be, pro rata with each of them; provided,
however, that if all or any portion of such excess payment is thereafter
recovered from the purchasing Lender under any of the circumstances described in
Section 10.06 (including pursuant to any settlement entered into by the
purchasing Lender in its discretion), such purchase shall to that extent be
rescinded and each other Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying
Lender's ratable share (according to the proportion of (i) the amount of such
paying Lender's required repayment to (ii) the total amount so recovered from
the purchasing Lender) of any interest or other amount paid or payable by the
purchasing Lender in respect of the total amount so recovered, without further
interest thereon. The Borrower agrees that any Lender so purchasing a
participation from another Lender may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off, but subject
to Section 10.09) with respect to such participation as fully as if such Lender
were the direct creditor of the Borrower in the amount of such participation.
The Administrative Agent will keep records (which shall be conclusive and
binding in the absence of manifest error) of participations purchased under this
Section and will in each case notify the Lenders following any such purchases or
repayments. Each Lender that purchases a participation pursuant to this Section
shall from and after such purchase have the right to give all notices, requests,
demands, directions and other communications under this Agreement with respect
to the portion of the Obligations purchased to the same extent as though the
purchasing Lender were the original owner of the Obligations purchased.

      2.14 INCREASE IN COMMITMENTS.

      (a) Provided there exists no Default and there has been no prior reduction
of the Aggregate Commitments, upon notice to the Administrative Agent (which
shall promptly notify the Lenders), the Borrower may from time to time, request
an increase in the Aggregate Commitments by an amount (for all such requests)
not exceeding $150,000,000; provided that any such request for an increase shall
be in a minimum amount of $25,000,000. At the time of sending such notice, the
Borrower (in consultation with the Administrative Agent) shall specify the time
period within which each Lender is requested to respond (which shall in no event
be less than ten Business Days from the date of delivery of such notice to the
Lenders). Each Lender shall notify the Administrative Agent within such time
period whether or not it agrees to increase its Commitment and, if so, whether
by an amount equal to, greater than, or less than its Pro Rata Share of such
requested increase. Any Lender not responding within such time period shall be
deemed to have declined to increase its Commitment. The Administrative Agent
shall notify the Borrower and each Lender of the Lenders' responses to each
request made hereunder. To the extent the Lenders have not agreed to increase
their respective Commitments in an amount sufficient to provide the full amount
of a requested increase, the Borrower may also invite additional Eligible
Assignees to become Lenders in order to provide, together with the existing

                                       34
<PAGE>
Lenders increasing their Commitments, the aggregate requested additional
Commitments. In order to so become a Lender, each such additional Eligible
Assignee shall execute and deliver a joinder agreement in form and substance
satisfactory to the Administrative Agent and its counsel.

      (b) If the Aggregate Commitments are increased in accordance with this
Section, the Administrative Agent and the Borrower shall determine the effective
date (the "Increase Effective Date") and the final allocation of such increase.
The Administrative Agent shall promptly notify the Borrower and the Lenders of
the final allocation of such increase and the Increase Effective Date. As a
condition precedent to such increase, the Borrower shall deliver to the
Administrative Agent a certificate of the Borrower dated as of the Increase
Effective Date (in sufficient copies for each Lender) signed by a Responsible
Officer (i) certifying and attaching the resolutions adopted by the Borrower
approving or consenting to such increase, and (ii) certifying that, before and
after giving effect to such increase, (A) the representations and warranties
contained in Article V and the other Loan Documents are true and correct on and
as of the Increase Effective Date, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they are true and correct as of such earlier date, and except that for
purposes of this Section 2.14, the representations and warranties contained in
subsections (a) and (b) of Section 5.11 shall be deemed to include the most
recent statements furnished pursuant to subsections (a) and (b), respectively,
of Section 6.01, and (B) no Default exists. The Borrower shall prepay any Loans
outstanding on the Increase Effective Date (and pay any additional amounts
required pursuant to Section 3.05) to the extent necessary to keep the
outstanding Loans ratable with any revised Pro Rata Shares arising from any
nonratable increase in the Commitments under this Section.

      (c) This Section shall supersede any provisions in Sections 2.13 or 10.01
to the contrary.

                                  ARTICLE III.
                     TAXES, YIELD PROTECTION AND ILLEGALITY

      3.01 TAXES.

      (a) Any and all payments by the Borrower to or for the account of the
Administrative Agent or any Lender under any Loan Document shall be made free
and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of the
Administrative Agent and each Lender, taxes imposed on or measured by its
overall net income, and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
Laws of which the Administrative Agent or such Lender, as the case may be, is
organized or maintains a lending office (all such non-excluded taxes, duties,
levies, imposts, deductions, assessments, fees, withholdings or similar charges,
and liabilities being hereinafter referred to as "Taxes"). If the Borrower shall
be required by any Laws to deduct any Taxes from or in respect of any sum
payable under any Loan Document to the Administrative Agent or any Lender, (i)
the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section), each of the Administrative Agent and such Lender receives
an

                                       35
<PAGE>
amount equal to the sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions, (iii) the Borrower shall pay the
full amount deducted to the relevant taxation authority or other authority in
accordance with applicable Laws, and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to the Administrative Agent (which shall
forward the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof.

      (b) In addition, the Borrower agrees to pay any and all present or future
stamp, court or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").

      (c) If the Borrower shall be required to deduct or pay any Taxes or Other
Taxes from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent or to such Lender, as the case may be, at the time interest
is paid, such additional amount that the Administrative Agent or such Lender
specifies is necessary to preserve the after-tax yield (after factoring in all
taxes, including taxes imposed on or measured by net income) that the
Administrative Agent or such Lender would have received if such Taxes or Other
Taxes had not been imposed.

      (d) The Borrower agrees to indemnify the Administrative Agent and each
Lender for (i) the full amount of Taxes and Other Taxes (including any Taxes or
Other Taxes imposed or asserted by any jurisdiction on amounts payable under
this Section) paid by the Administrative Agent and such Lender, (ii) amounts
payable under Section 3.01(c) and (iii) any liability (including additions to
tax, penalties, interest and expenses) arising therefrom or with respect
thereto, in each case whether or not such Taxes or Other Taxes were correctly or
legally imposed or asserted by the relevant Governmental Authority. Payment
under this subsection (d) shall be made within 30 days after the date the Lender
or the Administrative Agent makes a demand therefor.

      (e) If any Lender determines, in its sole discretion, that it has
irrevocably received, or has been granted a credit against, or relief or
remission from, or repayment or refund of, any Taxes or Other Taxes as to which
it has been indemnified by the Borrower or with respect to which the Borrower
has paid additional amounts pursuant to this Section, it shall pay to the
Borrower an amount equal to such credit, relief, remission, repayment or refund
(but only to the extent of indemnity payments made, or additional amounts paid,
by the Borrower under this Section with respect to the Taxes or Other Taxes
giving rise to such credit, relief, remission, repayment or refund), net of all
out-of-pocket expenses of such Lender, and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such
credit, relief, remission, repayment or refund), provided that the Borrower,
upon the request of such Lender, agrees to repay to such Lender the amount paid
over to the Borrower (plus any penalties, interest or other charges imposed by
the relevant Governmental Authority) in the event such Lender is required to
repay such credit, relief, remission, repayment or refund to such Governmental
Authority. Nothing contained herein shall (i) interfere with the right of any
Lender to arrange its tax affairs in whatever manner it determines is beneficial
to such Lender, in its sole discretion, (ii) require any Lender to make
available its tax returns (or any other

                                       36
<PAGE>
information relating to its tax affairs or any computations in respect thereof)
to the Borrower or any other Person, or (iii) require any Lender to take or
refrain from taking any action that would prejudice its ability to benefit from
any other credit, relief, remission, repayment or refund to which it may be
entitled.

      3.02 ILLEGALITY. If any Lender determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Lender or its applicable Lending Office to make, maintain or fund
Eurodollar Rate Loans, or to determine or charge interest rates based upon the
Eurodollar Rate, then, on notice thereof by such Lender to the Borrower through
the Administrative Agent, any obligation of such Lender to make or continue
Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate Loans
shall be suspended until such Lender notifies the Administrative Agent and the
Borrower that the circumstances giving rise to such determination no longer
exist. Upon receipt of such notice, the Borrower shall, upon demand from such
Lender (with a copy to the Administrative Agent), prepay or, if applicable,
convert all Eurodollar Rate Loans of such Lender to Base Rate Loans, either on
the last day of the Interest Period therefor, if such Lender may lawfully
continue to maintain such Eurodollar Rate Loans to such day, or immediately, if
such Lender may not lawfully continue to maintain such Eurodollar Rate Loans.
Upon any such prepayment or conversion, the Borrower shall also pay accrued
interest on the amount so prepaid or converted. Each Lender agrees to designate
a different Lending Office if such designation will avoid the need for such
notice and will not, in the good faith judgment of such Lender, otherwise be
materially disadvantageous to such Lender.

      3.03 INABILITY TO DETERMINE RATES. If (a) the Administrative Agent
determines for any reason that adequate and reasonable means do not exist for
determining the Eurodollar Rate, or (b) the Required Lenders determine that the
Eurodollar Rate does not adequately and fairly reflect the cost to the Lenders
of funding Loans hereunder as Eurodollar Rate Loans, the Administrative Agent,
in the case of clause (a), or the Required Lenders, in the case of clause (b),
will promptly so notify the Borrower, and, in the case of clause (b), the
Administrative Agent. From the date of any such notice is given until such
notice is revoked by the Administrative Agent, in the case of clause (a), or the
Required Lenders giving such notice, in the case of clause (b), the obligation
of the Lenders to make or maintain Eurodollar Rate Loans shall be suspended
until the Administrative Agent (in the case of clause (b) upon the instruction
of the Required Lenders) revokes such notice. Upon receipt of such notice, the
Borrower may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Borrowing of Base Rate Loans in the
amount specified therein.

      3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY; RESERVES ON
EURODOLLAR RATE LOANS.

      (a) If any Lender determines that as a result of the introduction of or
any change in or in the interpretation of any Law, or such Lender's compliance
therewith, there shall be any increase in the cost to such Lender of agreeing to
make or making, funding or maintaining Eurodollar Rate Loans or (as the case may
be) issuing or participating in Letters of Credit, or a reduction in the amount
received or receivable by such Lender in connection with any of the foregoing
(excluding for purposes of this subsection (a) any such increased costs or
reduction in

                                       37
<PAGE>
amount resulting from (i) Taxes or Other Taxes (as to which Section 3.01 shall
govern), (ii) changes in the basis of taxation of overall net income or overall
gross income by the United States or any foreign jurisdiction or any political
subdivision of either thereof under the Laws of which such Lender is organized
or has its Lending Office, and (iii) reserve requirements contemplated by
Section 3.04(c)), then from time to time upon demand of such Lender (with a copy
of such demand to the Administrative Agent), the Borrower shall pay to such
Lender such additional amounts as will compensate such Lender for such increased
cost or reduction.

      (b) If any Lender determines that the introduction of any Law regarding
capital adequacy or any change therein or in the interpretation thereof, or
compliance by such Lender (or its Lending Office) therewith, has the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of such Lender's obligations hereunder
(taking into consideration its policies with respect to capital adequacy and
such Lender's desired return on capital), then from time to time upon demand of
such Lender (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such reduction.

      (c) The Borrower shall pay to each Lender, as long as such Lender shall be
required to maintain reserves with respect to liabilities or assets consisting
of or including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities"), additional interest on the unpaid principal amount of each
Eurodollar Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive), which shall be due and payable on each date
on which interest is payable on such Loan, provided the Borrower shall have
received at least 15 days' prior notice (with a copy to the Administrative
Agent) of such additional interest from such Lender. If a Lender fails to give
notice 15 days prior to the relevant Interest Payment Date, such additional
interest shall be due and payable 15 days from receipt of such notice.

      3.05 COMPENSATION FOR LOSSES. Upon demand of any Lender (with a copy to
the Administrative Agent) from time to time, the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:

      (a) any continuation, conversion, payment or prepayment of any Loan other
than a Base Rate Loan on a day other than the last day of the Interest Period
for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise);

      (b) any failure by the Borrower (for a reason other than the failure of
such Lender to make a Loan) to prepay, borrow, continue or convert any Loan
other than a Base Rate Loan on the date or in the amount notified by the
Borrower; or

      (c) any assignment of a Eurodollar Rate Loan on a day other than the last
day of the Interest Period therefor as a result of a request by the Borrower
pursuant to Section 10.16;

including any loss or expense arising from the liquidation or reemployment of
funds obtained by it to maintain such Loan or from fees payable to terminate the
deposits from which such funds were obtained (but excluding any loss of
anticipated profits). The Borrower shall also pay any customary administrative
fees charged by such Lender in connection with the foregoing.

                                       38
<PAGE>
For purposes of calculating amounts payable by the Borrower to the Lenders under
this Section 3.05, each Lender shall be deemed to have funded each Eurodollar
Rate Loan made by it at the Eurodollar Rate for such Loan by a matching deposit
or other borrowing in the London interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Loan was
in fact so funded.

      3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION. A certificate of
the Administrative Agent or any Lender claiming compensation under this Article
III and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive in the absence of manifest error. In determining
such amount, the Administrative Agent or such Lender may use any reasonable
averaging and attribution methods.

      3.07 MITIGATION OBLIGATIONS; REPLACEMENT OF LENDERS.

      (a) Designation of a Different Lending Office. If any Lender requests
compensation under Section 3.04, or the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 3.01, or if any Lender gives a notice pursuant to
Section 3.02, then such Lender shall use reasonable efforts to designate a
different Lending Office for funding or booking its Loans hereunder or to assign
its rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the good faith judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section
3.01 or 3.04, as the case may be, in the future, or eliminate the need for the
notice pursuant to Section 3.02, as applicable, and (ii) in each case, would not
subject such Lender to any unreimbursed cost or expense and would not otherwise
be disadvantageous to such Lender. The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any such
designation or assignment.

      (b) Effect of Failure to or Delay in Demanding Compensation. Failure or
delay on the part of any Lender to demand compensation pursuant to Section 3.01
or Section 3.04 shall not constitute a waiver of such Lender's right to demand
such compensation, provided that the Borrower shall not be required to
compensate a Lender pursuant to the provisions thereof for any increased costs
incurred or reductions that occur as a result of the introduction of a Law or
change therein or in the interpretation thereof suffered more than nine months
prior to the date that such Lender notifies the Borrower of the introduction of
such Law or change therein or in the interpretation thereof giving rise to such
increased costs or reductions and of such Lender's intention to claim
compensation therefor (except that, if the introduction of the Law or change
therein or in the interpretation thereof giving rise to such increased costs or
reductions is retroactive, then the nine-month period referred to above shall be
extended to include the period of retroactive effect thereof).

      (c) Replacement of Lenders. If any Lender requests compensation under
Section 3.04, or if any Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 3.01, the Borrower may replace such Lender in accordance with Section
10.16.

      3.08 SURVIVAL. All of the Borrower's obligations under this Article III
shall survive termination of the Aggregate Commitments and repayment of all
other Obligations hereunder.

                                       39
<PAGE>
                                  ARTICLE IV.
                    CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

      4.01 CONDITIONS OF INITIAL CREDIT EXTENSION. The obligation of each Lender
to make its initial Credit Extension hereunder is subject to satisfaction of the
following conditions precedent:

      (a) The Administrative Agent's receipt of the following, each of which
shall be originals or facsimiles (followed promptly by originals) unless
otherwise specified, each properly executed by a Responsible Officer, each dated
the Closing Date (or, in the case of certificates of governmental officials, a
recent date before the Closing Date) and each in form and substance satisfactory
to the Administrative Agent and each of the Lenders:

            (i) executed counterparts of this Agreement, sufficient in number
      for distribution to the Administrative Agent, each Lender and the
      Borrower;

            (ii) a Note executed by the Borrower in favor of each Lender
      requesting a Note;

            (iii) such certificates of resolutions or other action, incumbency
      certificates and/or other certificates of Responsible Officers as the
      Administrative Agent may require evidencing the identity, authority and
      capacity of each Responsible Officer authorized to act on behalf of the
      Borrower in connection with this Agreement and the other Loan Documents;

            (iv) a good standing certificate from the Secretary of State of the
      State of Delaware;

            (v) a favorable opinion of Mayer, Brown, Rowe & Maw LLP, counsel to
      the Borrower, addressed to the Administrative Agent and each Lender, as to
      the matters set forth in Exhibit E and such other matters concerning the
      Borrower and the Loan Documents as the Required Lenders may reasonably
      request;

            (vi) a certificate of a Responsible Officer either (A) attaching
      copies of all consents, licenses and approvals required in connection with
      the execution, delivery and performance by the Borrower and the validity
      against the Borrower of the Loan Documents, and such consents, licenses
      and approvals shall be in full force and effect, or (B) stating that no
      such consents, licenses or approvals are so required;

            (vii) a certificate signed by a Responsible Officer certifying (A)
      that the conditions specified in Sections 4.02(a) and (b) have been
      satisfied, (B) that there has been no event or circumstance since the date
      of the Audited Financial Statements that has had or could be reasonably
      expected to have, either individually or in the aggregate, a Material
      Adverse Effect; and (C) the current Debt Ratings;

            (viii) a duly completed Compliance Certificate as of the last day of
      the fiscal quarter of the Borrower most recently ended prior to the
      Closing Date, signed by a Responsible Officer;

                                       40
<PAGE>
            (ix) evidence that all obligations owing under the Existing Credit
      Agreement by the Borrower are, prior to or concurrently with the first
      Loan delivered hereunder, being paid in full; and

            (x) such other assurances, certificates, documents, consents or
      opinions as the Administrative Agent, the L/C Issuer or the Required
      Lenders reasonably may require.

      (b) Any fees required to be paid on or before the Closing Date shall have
been paid.

      (c) Unless waived by the Administrative Agent, the Borrower shall have
paid all Attorney Costs of the Administrative Agent to the extent invoiced prior
to or on the Closing Date, plus such additional amounts of Attorney Costs as
shall constitute its reasonable estimate of Attorney Costs incurred or to be
incurred by it through the closing proceedings (provided that such estimate
shall not thereafter preclude a final settling of accounts between the Borrower
and the Administrative Agent).

      (d) The Closing Date shall have occurred on or before May 27, 2004.

      4.02 CONDITIONS TO ALL CREDIT EXTENSIONS. The obligation of each Lender to
honor any Request for Credit Extension (other than a Loan Notice requesting only
a conversion of Loans to the other Type or a continuation of Eurodollar Rate
Loans) is subject to the following conditions precedent:

      (a) The representations and warranties of the Borrower contained in
Article V (other than (i) after the Closing Date, the representation and
warranty set forth in Section 5.11(c) and (ii) with respect to any Loan the
proceeds of which are used solely to repay outstanding commercial paper at the
maturity thereof, the representation and warranty set forth in Section 5.05) or
any other Loan Document, or which are contained in any document furnished at any
time under or in connection herewith or therewith, shall be true and correct on
and as of the date of such Credit Extension, except to the extent that such
representations and warranties specifically refer to an earlier date, in which
case they shall be true and correct as of such earlier date, and except that for
purposes of this Section 4.02, the representations and warranties contained in
subsections (a) and (b) of Section 5.11 shall be deemed to include the most
recent statements furnished pursuant to clauses (a) and (b), respectively, of
Section 6.01.

      (b) No Default shall exist, or would result from such proposed Credit
Extension.

      (c) The Administrative Agent and, if applicable, the L/C Issuer shall have
received a Request for Credit Extension in accordance with the requirements
hereof.

      Each Request for Credit Extension (other than a Loan Notice requesting
only a conversion of Loans to the other Type or a continuation of Eurodollar
Rate Loans) submitted by the Borrower shall be deemed to be a representation and
warranty that the conditions specified in Sections 4.02(a) and (b) have been
satisfied on and as of the date of the applicable Credit Extension.

                                       41
<PAGE>
                                   ARTICLE V.
                         REPRESENTATIONS AND WARRANTIES

      The Borrower represents and warrants to the Administrative Agent and the
Lenders that:

      5.01 EXISTENCE, QUALIFICATION AND POWER; COMPLIANCE WITH LAWS. The
Borrower and each of its Subsidiaries (a) is duly organized, validly existing
and in good standing under the Laws of the jurisdiction of its incorporation or
organization, (b) has all requisite power and authority and all requisite
governmental licenses, authorizations, consents and approvals to (i) own its
assets and carry on its business and (ii) execute, deliver and perform its
obligations under the Loan Documents to which it is a party, (c) is duly
qualified to do business in 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 in
each case referred to in clause (b)(i), (c) or (d), to the extent that the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.

      5.02 AUTHORIZATION; NO CONTRAVENTION. The execution, delivery and
performance by the Borrower of each Loan Document to which it is party, have
been duly authorized by all necessary corporate action, and do not and will not
(a) contravene the terms of any of the Borrower's Organization Documents; (b)
conflict with or result in any breach or contravention of, or the creation of
any Lien under, (i) any material Contractual Obligation to which the Borrower or
any of its Subsidiaries is a party or (ii) any order, injunction, writ or decree
of any Governmental Authority or any arbitral award to which the Borrower or any
of its Subsidiaries or any of its property is subject; or (c) violate any
Requirement of Law applicable to the Borrower or any Subsidiary.

      5.03 GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person (other than any of the foregoing
which has been obtained or made and is in full force and effect) is necessary or
required in connection with the execution, delivery or performance by, or
enforcement against, the Borrower of this Agreement or any other Loan Document.

      5.04 BINDING EFFECT. This Agreement and each other Loan Document
constitute the legal, valid and binding obligations of the Borrower, enforceable
against the Borrower in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability.

      5.05 LITIGATION. There are no actions, suits, proceedings, claims or
disputes pending or, to the Knowledge of the Borrower, threatened, at law, in
equity, in arbitration or before any Governmental Authority, against the
Borrower or any Subsidiary or any of their respective properties that (a)
purport to affect or pertain to this Agreement or any other Loan Document, or
any of the transactions contemplated hereby or thereby, or (b) either
individually or in the aggregate, if determined adversely, could in the
reasonable judgment of the Borrower be expected to have a Material Adverse
Effect. No injunction, writ, temporary restraining order or other order of any
nature has been issued by any court or other Governmental Authority

                                       42
<PAGE>
purporting to enjoin or restrain the execution, delivery or performance of this
Agreement or any other Loan Document, or directing that the transactions
provided for herein or therein not be consummated as herein or therein provided.

      5.06 NO DEFAULT. No Default exists or would result from the consummation
of the transactions contemplated by this Agreement or any other Loan Document.
As of the Closing Date, neither the Borrower nor any Subsidiary is in default
under or with respect to any Contractual Obligation in any respect which,
individually or together with all such defaults, could reasonably be expected to
have a Material Adverse Effect.

      5.07 ERISA COMPLIANCE.

      (a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state Laws. Each
Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto and, to the best
knowledge of the Borrower, nothing has occurred which would prevent, or cause
the loss of, such qualification. The Borrower and each ERISA Affiliate have made
all required contributions to each Plan subject to Section 412 of the Code, and
no application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.

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

      (c) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no contribution failure has occurred with respect to a Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA; (iii) no
Pension Plan has any Unfunded Pension Liability that could, either individually
or in the aggregate with the Unfunded Pension Liability of all other Pensions
Plans, reasonably be expected to have a Material Adverse Effect; (iv) neither
the Borrower nor any ERISA Affiliate has incurred, or reasonably expects to
incur, any material liability under Title IV of ERISA with respect to any
Pension Plan (other than premiums due and not delinquent under Section 4007 of
ERISA); (v) neither the Borrower nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any material liability (and no event has occurred
which, with the giving of notice under Section 4219 of ERISA, would result in
such liability) under Section 4201 or Section 4243 of ERISA with respect to a
Multiemployer Plan; and (vi) neither the Borrower nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or Section
4212(c) of ERISA.

      5.08 USE OF PROCEEDS; MARGIN REGULATIONS. The proceeds of the Credit
Extensions will be used solely for the purposes set forth in and permitted by
Section 6.12 and Section 7.07. Neither the Borrower nor any Subsidiary is
generally engaged in the business of purchasing or selling Margin Stock or
extending credit for the purpose of purchasing or carrying Margin Stock.

                                       43
<PAGE>
      5.09 OWNERSHIP OF PROPERTY; LIENS. Each of the Borrower and each
Subsidiary (other than foreign Subsidiaries) has good record and marketable
title in fee simple to, or valid leasehold interests in, all real property
necessary to conduct their respective businesses in the ordinary course, except
for (i) Permitted Liens, and (ii) such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The property of the Borrower and its Subsidiaries is subject to
no Liens, other than Permitted Liens.

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

      5.11 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.

      (a) The Audited Financial Statements (i) were prepared in accordance with
GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein; (ii) fairly present the financial condition
of the Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all material indebtedness and other liabilities,
direct or contingent, of the Borrower and its Subsidiaries as of the date
thereof, including liabilities for taxes, material commitments and Indebtedness.

      (b) The unaudited consolidated balance sheet of the Borrower and its
Subsidiaries dated March 31, 2004, and the related consolidated statements of
income or operations, shareholders' equity and cash flows for the fiscal quarter
ended on that date (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein, and (ii) fairly present the financial condition of the Borrower
and its Subsidiaries as of the date thereof and their results of operations for
the period covered thereby, subject, in the case of clauses (i) and (ii), to the
absence of footnotes and to normal year-end audit adjustments.

      (c) Since the date of the Audited Financial Statements, there has been no
event or circumstance, either individually or in the aggregate, that has had or
could reasonably be expected to have a Material Adverse Effect.

      5.12 ENVIRONMENTAL COMPLIANCE. The Borrower and its Subsidiaries conduct
in the ordinary course of business a review of the effect of existing
Environmental Laws and existing Environmental Claims on their respective
businesses, operations and properties, and as a result thereof the Borrower has
reasonably concluded that, except as specifically disclosed in Schedule 5.12,
such Environmental Laws and Environmental Claims are unlikely to have,
individually or in the aggregate, a Material Adverse Effect.

                                       44
<PAGE>
      5.13 REGULATED ENTITIES. None of the Borrower, any Person controlling the
Borrower, or any Subsidiary is an "Investment Company" within the meaning of the
Investment Company Act of 1940. The Borrower is not subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, any state
public utilities code, or any other Federal or state statute or regulation
limiting its ability to incur Indebtedness.

      5.14 NO BURDENSOME RESTRICTIONS. Neither the Borrower nor any Subsidiary
is bound by, or subject to any restriction in, any Organization Document or
Requirement of Law, which could reasonably be expected to have a Material
Adverse Effect.

      5.15 SUBSIDIARIES. As of the Closing Date, the Borrower has no
Subsidiaries other than those specifically disclosed in Part (a) of Schedule
5.15 and has no equity investments in any other corporation or entity other than
those specifically disclosed in Part(b) of Schedule 5.15.

      5.16 INSURANCE. The properties of the Borrower and its Subsidiaries are
insured with financially sound and reputable insurance companies not Affiliates
of the Borrower, in such amounts (after giving effect to any self-insurance
compatible with the following standards), with such deductibles and covering
such risks as are customarily carried by companies engaged in similar businesses
and owning similar properties in localities where the Borrower or the applicable
Subsidiary operates.

      5.17 DISCLOSURE. The representations and warranties made by the Borrower
and its Subsidiaries in the Loan Documents as of the date such representations
and warranties are made or deemed made, and the statements contained in any
exhibit, report, statement or certificate furnished in writing by or on behalf
of the Borrower or any Subsidiary in connection with the Loan Documents, taken
as a whole, do not contain any untrue statement of a material fact or omit any
material fact required to be stated therein or necessary to make the statements
made therein, taken as a whole and in light of the circumstances under which
they are made, not misleading in any material respect as of the time when made
or delivered (it being understood that all written financial projections with
respect to the Borrower and its Subsidiaries that have been or may hereafter be
delivered to the Administrative Agent and the Lenders have been or will be
prepared in good faith based upon assumptions believed by the Borrower to be
reasonable as of the date of the applicable projections).

                                  ARTICLE VI.
                              AFFIRMATIVE COVENANTS

      So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding:

      6.01 FINANCIAL STATEMENTS. The Borrower shall deliver to each Lender and
the Administrative Agent, in form and detail satisfactory to the Lenders and the
Administrative Agent (it being understood that for purposes hereof, the form and
detail required by the SEC for annual and quarterly reports filed pursuant to
the Exchange Act shall be deemed satisfactory):

                                       45
<PAGE>
      (a) as soon as available, but not later than 95 days after the end of each
fiscal year or, if earlier, not later than 5 days after such date as required to
be filed with the SEC, a copy of the audited consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such year and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for such year, setting forth in each case in comparative form the figures
for the previous fiscal year, and accompanied by the opinion of Ernst & Young
LLP or another nationally-recognized independent public accounting firm
("Independent Auditor"), which opinion (i) shall state that such consolidated
financial statements present fairly the Borrower's consolidated financial
position for the periods indicated in conformity with GAAP, (ii) shall not be
subject to any "going concern" or like qualification or exception, and (iii)
shall not be qualified or limited because of a restricted or limited examination
by the Independent Auditor of any material portion of the Borrower's or any
Subsidiary's records; and

      (b) as soon as available, but not later than 50 days after the end of each
of the first three fiscal quarters of each fiscal year (commencing with the
fiscal quarter ending June 30, 2004) or, if earlier, not later than 5 days after
such date as required to be filed with the SEC, a copy of the unaudited
consolidated balance sheet of the Borrower and its Subsidiaries as of the end of
such quarter and the related consolidated statements of income, shareholders'
equity and cash flows for the period commencing on the first day and ending on
the last day of such quarter, and certified by a Responsible Officer as fairly
presenting, in accordance with GAAP (subject to ordinary, good faith year-end
audit adjustments), the financial position and the results of operations of the
Borrower and its Subsidiaries as of such date and for such period, together
with, for such fiscal quarter and the portion of the Borrower's fiscal year then
ended, the corresponding figures for the same fiscal quarter and portion of the
previous fiscal year in comparative form.

      6.02 CERTIFICATES; OTHER INFORMATION. The Borrower shall furnish to each
Lender and the Administrative Agent:

      (a) concurrently with the delivery of the financial statements referred to
in Sections 6.01(a) and (b) (commencing with the delivery of the financial
statements for the fiscal quarter ending June 30, 2004), a duly completed
Compliance Certificate executed by a Responsible Officer;

      (b) promptly after their becoming available, copies of all financial
statements and reports that the Borrower sends to its shareholders, and copies
of all financial statements and regular, periodic or special reports (including
Forms 10K, 10Q and 8K) that the Borrower or any Subsidiary may make to, or file
with, the SEC; and

      (c) promptly, such additional information regarding the business,
financial or corporate affairs of the Borrower or any Subsidiary, or compliance
with the terms of the Loan Documents, as the Administrative Agent or any Lender
may from time to time reasonably request.

      Documents required to be delivered pursuant to Section 6.01 or Section
6.02(a) or (b) may be delivered electronically and if so delivered, shall be
deemed to have been delivered on the date (i) on which the Borrower posts such
documents, or provides a link thereto on the

                                       46
<PAGE>
Borrower's website on the Internet at the website address listed on Schedule
10.02; or (ii) on which such documents are posted on the Borrower's behalf on an
Internet or intranet website, if any, to which each Lender and the
Administrative Agent have access (whether a commercial, third-party website or
whether sponsored by the Administrative Agent); provided that: (i) the Borrower
shall deliver paper copies of such documents to the Administrative Agent upon
request (and the Administrative Agent shall forward paper copies thereof to any
Lender upon request) by the Administrative Agent and (ii) the Borrower shall
notify (which may be by facsimile or electronic mail) the Administrative Agent
(which shall notify each Lender) of the posting of any such documents and
provide to the Administrative Agent by electronic mail electronic versions
(i.e., soft copies) of such documents. Notwithstanding anything contained
herein, in every instance the Borrower shall be required to provide a paper copy
of each Compliance Certificate required by Section 6.02(a) to the Administrative
Agent. Except for such Compliance Certificates, the Administrative Agent shall
have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to
monitor compliance by the Borrower with any such request for delivery, and each
Lender shall be solely responsible for requesting delivery to it or maintaining
its copies of such documents.

      6.03 NOTICES. The Borrower shall promptly notify the Administrative Agent
(which shall promptly notify each Lender):

      (a) of the occurrence of any Default known to the Borrower;

      (b) of any of the following matters: (i) breach or non-performance of, or
any default under, a Contractual Obligation of the Borrower or any Subsidiary;
(ii) any dispute, litigation, investigation, proceeding or suspension between
the Borrower or any Subsidiary and any Governmental Authority; or (iii) the
commencement of, or any material ruling, order or judgment in, any litigation or
proceeding affecting the Borrower or any Subsidiary, including pursuant to any
applicable Environmental Laws, in each case if any matter described in clause
(i), (ii) or (iii) has resulted or could reasonably be expected to result in a
Material Adverse Effect;

      (c) of the occurrence of any of the following events known to the Borrower
which affect the Borrower or any ERISA Affiliate, and deliver to the
Administrative Agent and each Lender a copy of any notice with respect to such
event that is filed with a Governmental Authority and any notice delivered by a
Governmental Authority to the Borrower or any ERISA Affiliate with respect to
such event:

            (i) an ERISA Event;

            (ii) a contribution failure with respect to a Pension Plan
      sufficient to give rise to a Lien under Section 302(f) of ERISA;

            (iii) the adoption of, or the commencement of contributions to, any
      Pension Plan by the Borrower or any ERISA Affiliate that, in either case,
      requires material contributions; or

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

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<PAGE>
      (d) of any material change in accounting policies or financial reporting
practices by the Borrower and its consolidated Subsidiaries; and

      (e) of any announcement by Moody's or S&P of any change in a Debt Rating.

      Each notice under this Section shall be accompanied by a written statement
of a Responsible Officer setting forth details of the occurrence referred to
therein, and stating what action the Borrower or any affected Subsidiary has
taken and proposes to take with respect thereto. Each notice pursuant to Section
6.03(a) shall describe with particularity any and all provisions of this
Agreement and any other Loan Document that have been breached.

      6.04 PRESERVATION OF CORPORATE EXISTENCE, ETC. The Borrower shall, and
shall cause each Subsidiary to (provided that nothing in this Section 6.04 shall
prevent the voluntary liquidation, dissolution or winding up, not under any
bankruptcy or insolvency law, of any Subsidiary so long as no Default exists or
will result therefrom):

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

      (b) preserve and maintain in full force and effect all of its governmental
rights, privileges, qualifications, permits, licenses and franchises necessary
in the normal conduct of its business (except (i) in connection with
transactions and sales of assets permitted by Section 7.04 and (ii) to the
extent the failure to preserve and maintain any of the foregoing would not,
either singly or in the aggregate, reasonably be expected to have a Material
Adverse Effect); and

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

      6.05 MAINTENANCE OF PROPERTY. The Borrower shall, and shall cause each
Subsidiary to, maintain and preserve all its property which is used or useful in
its business in good working order and condition, ordinary wear and tear
excepted, except to the extent that failure to do so would not reasonably be
expected to have a Material Adverse Effect.

      6.06 MAINTENANCE OF INSURANCE. The Borrower shall, and shall cause each
Subsidiary to, maintain, with financially sound and reputable independent
insurers (or pursuant to a self-insurance program), insurance with respect to
its properties and business in such amounts, with such deductibles, and covering
such risks as are customarily carried under similar circumstances by such other
Persons.

      6.07 PAYMENT OF TAXES. The Borrower shall, and shall cause each Subsidiary
to, pay and discharge, as the same become due and payable, all material tax
liabilities, assessments and governmental charges or levies upon it or its
properties or assets, unless, in each case, the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance with GAAP
are being maintained by the Borrower or such Subsidiary.

      6.08 COMPLIANCE WITH LAWS. The Borrower shall, and shall cause each
Subsidiary to, comply with all Requirements of Law of any Governmental Authority
having jurisdiction over it

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<PAGE>
or its business (including the Federal Fair Labor Standards Act) the
non-compliance with which would reasonably be expected to have a Material
Adverse Effect.

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

      6.10 BOOKS AND RECORDS AND INSPECTION RIGHTS. The Borrower shall, and
shall cause each Subsidiary to, maintain proper books of record and account, in
which full, true and correct entries (sufficient to permit the preparation of
consolidated financial statements in conformity with GAAP) shall be made of all
financial transactions and matters involving the assets and business of the
Borrower and such Subsidiary. The Borrower shall permit, and shall cause each
Subsidiary to permit, the Administrative Agent, any Lender or their respective
representatives, subject to such limitations as the Borrower may reasonably
impose to ensure compliance with any applicable legal or contractual
restrictions, to visit and inspect the properties of the Borrower or any
Subsidiary, to examine their respective corporate, financial and operating
records, and make copies thereof or abstracts therefrom, and to discuss the
affairs, finances and accounts of the Borrower or any Subsidiary with their
respective officers at such reasonable times during normal business hours as may
be reasonably desired, upon reasonable advance notice to the Borrower; provided
that when an Event of Default exists the Administrative Agent or any Lender (or
any of their respective representatives or independent contractors) may do any
of the foregoing at the expense of the Borrower at any time during normal
business hours and without advance notice.

      6.11 ENVIRONMENTAL LAWS. The Borrower shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
compliance with all Environmental Laws, except to the extent any failure to be
compliance would not, individually or in the aggregate with all other such
failures, reasonably be expected to result in a Material Adverse Effect.

      6.12 USE OF PROCEEDS. The Borrower shall use the proceeds of the Credit
Extensions (i) to refinance indebtedness under the Existing Credit Agreement,
and (ii) for working capital, capital expenditures, Acquisitions, commercial
paper back-up, share repurchases and other general corporate purposes (including
the payment of dividends) not in contravention of any Requirement of Law or of
any Loan Document; provided that (x) the Borrower shall not use the proceeds of
any Loan to make any Acquisition if the Board of Directors of the Person to be
acquired has not approved such Acquisition, and (y) the Borrower shall only use
the proceeds of any Loan to make share repurchases if either (A) any Margin
Stock so acquired is promptly retired following the purchase or other
acquisition thereof or (B) at all times and after giving effect to each such
purchase or acquisition, not more than twenty five percent (25%) of the total
assets of the Borrower and its Subsidiaries on a consolidated basis are
represented by Margin Stock owned by the Borrower and its Subsidiaries on a
consolidated basis.

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<PAGE>
      6.13 CHANGE IN BUSINESS. The Borrower and its Subsidiaries taken as a
whole shall not engage in any business other than businesses in which they are
engaged on the Closing Date and lines of business reasonably related thereto.

                                  ARTICLE VII.
                               NEGATIVE COVENANTS

      So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding:

      7.01 FINANCIAL CONDITION COVENANTS.

      (a) Minimum Interest Coverage Ratio. The Borrower shall not permit the
Interest Coverage Ratio for any Computation Period, beginning with the first
Computation Period ending after the Closing Date, to be less than 3.50 to 1.00.

      (b) Maximum Total Debt to EBITDA Ratio. The Borrower shall not permit the
Total Debt to EBITDA Ratio for any Computation Period, beginning with the first
Computation Period ending after the Closing Date, to be greater than 3.25 to
1.00.

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

      (a) any Lien existing on the Closing Date and set forth in Schedule 7.02,
and any extension, renewal or replacement of any such Lien so long as the
principal amount of the obligations secured thereby is not increased (other than
an increase resulting solely from a change in applicable rates of exchange
between U.S. Dollars, on the one hand, and any other currency in which such
principal amount is denominated, on the other hand) and the scope of the
property subject to such Lien is not extended;

      (b) Liens imposed by law for taxes, assessments or charges of any
Governmental Authority for claims not yet due, or to the extent that non-payment
thereof is permitted by Section 6.07, provided that no notice of Lien has been
filed or recorded under the Code;

      (c) statutory Liens of landlords, Liens of carriers, warehousemen,
mechanics and materialmen and other Liens imposed by law or created in the
ordinary course of business which are not delinquent or remain payable without
penalty or which are being contested in good faith by appropriate proceedings;

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

                                       50
<PAGE>
      (e) Liens on the property of the Borrower or any Subsidiary securing (i)
the non-delinquent performance of bids, trade contracts (other than for borrowed
money), leases (other than Capital Leases and leases giving rise to Synthetic
Lease Obligations), statutory obligations, (ii) surety bonds (excluding appeal
bonds and other bonds posted in connection with court proceedings or judgments)
and (iii) other non-delinquent obligations of a like nature in each case
incurred in the ordinary course of business, provided all such Liens in the
aggregate would not (even if enforced) cause a Material Adverse Effect;

      (f) Liens consisting of judgment or judicial attachment liens and liens
securing contingent obligations on appeal bonds and other bonds posted in
connection with court proceedings or judgments, provided that (i) in the case of
judgment and judicial attachment liens, the enforcement of such Liens is
effectively stayed and (ii) all such liens in the aggregate at any time
outstanding for the Borrower and its Subsidiaries do not exceed $20,000,000;

      (g) easements, rights-of-way, covenants, conditions, restrictions and
other similar encumbrances incurred in the ordinary course of business which,
individually or in the aggregate, do not materially interfere with the ordinary
conduct of the respective businesses of the Borrower and its Subsidiaries;

      (h) Liens securing obligations in respect of Capital Leases or operating
leases (including leases giving rise to Synthetic Lease Obligations) on assets
subject to such leases, provided that, in the case of Capital Leases and leases
giving rise to Synthetic Lease Obligations, such leases are otherwise permitted
hereunder;

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

      (j) any Lien on property existing at the time of acquisition of such
property by the Borrower or a Subsidiary, or Liens to secure the payment of all
or part of the purchase price of property upon the acquisition of property by
the Borrower or a Subsidiary or to secure any Indebtedness incurred or
guaranteed prior to, at the time of, or within one hundred eighty (180) days
after, the later of the date of acquisition of such property and the date such
property is placed in service, for the purpose of financing all or any part of
the purchase price thereof, or Liens to secure any Indebtedness incurred or
guaranteed for the purpose of financing the cost to the Borrower or a Subsidiary
or improvements to such acquired property; provided, in each case, that (i) no
such Lien shall any time encumber any property other than the property financed
by such Indebtedness and (ii) the Indebtedness secured thereby does not exceed
the cost or fair market value, whichever is lower, of the property being
acquired on the date of acquisition;

      (k) other Liens, in addition to those permitted by clauses (a) through
(j), securing obligations or arising in connection with Securitization
Transactions; provided that (i) the sum (without duplication) of all such
obligations (excluding obligations arising in connection with

                                       51
<PAGE>
Securitization Transactions) shall not at any time exceed in the aggregate
$100,000,000, and (ii) the aggregate investment or claim held at any time by all
purchasers, assignees or other transferees of (or of interests in) receivables
and other rights to payment in all Securitization Transactions, shall not at any
time exceed in the aggregate $200,000,000; and

      (l) rights of first refusal, rights of Governmental Authorities to approve
transfers and other similar restrictions on transfer of any ownership interest
of the Borrower or any of its Subsidiaries in any joint venture or similar
investment in an entity (other than a Subsidiary) operating primarily outside of
the United States.

      7.03 RESTRICTIONS ON SUBSIDIARIES. The Borrower (a) will not enter into
any agreement or understanding pursuant to which any claim it may have against
any Subsidiary would be subordinate in any manner to the payment of any other
obligation of such Subsidiary and (b) will not, and will not permit any
Subsidiary to, enter into any agreement or understanding which by its terms
limits or restricts the ability of such Subsidiary to make funds available to
the Borrower (whether by way of a dividend or other distribution, by repayment
of any inter-company advance or otherwise) if, in any such case referred to in
(a) or (b) above, there is, at the time any such agreement or understanding is
entered into, a reasonable likelihood that all such agreements and
understandings referred to in (a) or (b) above, considered together, would
materially and adversely affect the ability of the Borrower to meet its
obligations as they become due.

      7.04 CONSOLIDATION, MERGERS AND SALES OF ASSETS. The Borrower will not
merge or consolidate with any other Person or sell, lease, transfer or otherwise
dispose of its property and assets as, or substantially as, an entirety to any
Person, unless (a) either the Borrower shall be the continuing or surviving
corporation, or the successor or acquiring corporation shall be a solvent
corporation organized under the laws of any State of the United States of
America and shall expressly assume in writing all of the obligations of the
Borrower under this Agreement and the Notes, including all covenants herein and
therein contained, and such successor or acquiring corporation shall succeed to
and be substituted for the Borrower with the same effect as if it had been named
herein as a party hereto, provided that no such sale shall release the Borrower
from any of its obligations and liabilities under this Agreement or the Notes
unless such sale is followed by the complete liquidation of the Borrower and
substantially all the assets of the Borrower immediately following such sale are
distributed in such liquidation, and (b) the Borrower as the continuing or
surviving corporation or the successor or acquiring corporation, as the case may
be, shall not, immediately after such merger or consolidation, or such sale or
other disposition, be in default under any such obligations.

      7.05 LIMITATION ON SUBSIDIARY INDEBTEDNESS. The Borrower shall not permit
its Subsidiaries to create, incur, assume or suffer to exist, or otherwise
become or remain directly or indirectly liable with respect to, any Indebtedness
(excluding obligations in respect of Securitization Transactions) at any time
outstanding in an aggregate amount in excess of the greater of (a) $200,000,000
and (b) 25% of Consolidated Net Worth.

      7.06 TRANSACTIONS WITH AFFILIATES. The Borrower shall not, and shall not
permit any Subsidiary to, enter into any transaction with any Affiliate of the
Borrower (other than the Borrower or a Subsidiary), except upon fair and
reasonable terms no less favorable to the

                                       52
<PAGE>
Borrower or such Subsidiary than would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of the Borrower or such Subsidiary.

      7.07 USE OF PROCEEDS. The Borrower shall not, and shall not permit any
Subsidiary to, use any portion of the proceeds of any Credit Extension, whether
directly or indirectly, and whether immediately, incidentally or ultimately, to
purchase or carry Margin Stock or to extend credit to others for the purpose of
purchasing or carrying Margin Stock in violation of the provisions of Regulation
U of the FRB.

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

      7.09 SECURITIZATION TRANSACTIONS. The Borrower shall not, and shall not
permit its Subsidiaries to, enter into any Securitization Transaction to the
extent that the aggregate investment or claims held at any time by all
purchasers, assignees, transferees of (or of interests in) receivables and other
rights to payment in all Securitization Transactions would at any time exceed
$200,000,000.

                                 ARTICLE VIII.
                         EVENTS OF DEFAULT AND REMEDIES

      8.01 EVENTS OF DEFAULT. Any of the following shall constitute an Event of
Default:

      (a) Non-Payment. The Borrower fails to pay (i) when and as required to be
paid herein, any principal of any Loan, (ii) within 2 Business Days after
receipt of any notice of a drawing under a Letter of Credit, the Unreimbursed
Amount with respect to such Letter of Credit or (iii) within 5 Business Days
after the same becomes due, any interest, fee or other amount payable hereunder
or under any other Loan Document.

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

      (c) Specific Defaults. The Borrower fails to perform or observe any term,
covenant or agreement contained in Section 6.04 (with respect to the Borrower
only), in Section 6.12 or in Article VII.

      (d) Other Defaults. The Borrower fails to perform or observe any other
term or covenant contained in this Agreement or any other Loan Document (any
such failure being referred to in this Section 8.01(d) as a "default") and such
default shall continue unremedied for a period of 30 days after (i) the date
upon which written notice of such default is given to the

                                       53
<PAGE>
Borrower by the Administrative Agent or (ii) if the Borrower fails to promptly
notify the Administrative Agent and the Lenders of the occurrence of any default
in accordance with Section 6.03, the date on which a Responsible Officer has
actual knowledge of such default.

      (e) Cross-Default. (i) The Borrower or any Subsidiary (A) fails to make
any payment of any Material Financial Obligation (other than Indebtedness
hereunder) when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise, but after giving effect to any applicable
grace or cure period); or (B) fails to perform or observe any other condition or
covenant, or any other event shall occur or condition exist, under one or more
agreements or instruments relating to such Material Financial Obligations, if
the effect of such failure, event or condition is to cause (or require), or to
permit the holder or holders of such Material Financial Obligations (or the
beneficiary or beneficiaries of such Material Financial Obligations (or a
trustee or agent on behalf of such holder or holders or beneficiary or
beneficiaries)) to cause (or require), such Material Financial Obligations to
become due and payable (or to be purchased, repurchased, defeased, redeemed or
cash collateralized) prior to the stated maturity thereof.

      (f) Insolvency; Voluntary Proceedings. The Borrower or any Material
Subsidiary (i) generally fails to pay, or admits in writing its inability to
pay, its debts as they become due, subject to applicable grace periods, if any,
whether at stated maturity or otherwise; (ii) voluntarily ceases to conduct its
business in the ordinary course; (iii) applies for or consents to any Insolvency
Proceeding; or (iv) takes any action to effectuate or authorize any of the
foregoing; provided that the foregoing shall not apply to the voluntary
liquidation, dissolution or winding up of a Subsidiary permitted by Section
6.04.

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

      (h) ERISA. (i) An ERISA Event shall occur with respect to a Pension Plan
or Multiemployer Plan which has resulted or could reasonably be expected to
result in liability of the Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of $20,000,000;
(ii) a contribution failure shall occur with respect to a Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA; or (iii) the
Borrower or any ERISA Affiliate shall fail to pay when due, after the expiration
of any applicable grace period (or any period during which (x) the Borrower is
permitted to contest its obligation to make such payment without incurring any
liability (other than interest) or penalty and (y) the Borrower is contesting
such obligation in good faith and by appropriate proceedings),

                                       54
<PAGE>
any installment payment with respect to its withdrawal liability under Section
4201 of ERISA or any contribution obligation under Section 4243 of ERISA, in
each case under a Multiemployer Plan in an aggregate amount in excess of
$30,000,000.

      (i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Borrower or any Subsidiary involving in the aggregate a liability (to the extent
not covered by insurance as to which the insurer does not dispute coverage) as
to any single or related series of transactions, incidents or conditions of
$50,000,000 or more, and (A) enforcement proceedings are commenced by any
creditor upon such judgment, order, decree or award, or (B) the same shall
remain unvacated and unstayed pending appeal for a period of 30 days after the
entry thereof.

      (j) Non-Monetary Judgments. Any non-monetary judgment, order or decree is
entered against the Borrower or any Subsidiary which does or would reasonably be
expected to have a Material Adverse Effect, and (A) enforcement proceedings are
commenced by any creditor upon such judgment, order or decree, or (B) there
shall be any period of 30 consecutive days during which a stay of enforcement of
such judgment or order, by reason of a pending appeal or otherwise, shall not be
in effect.

      (k) Change of Control. There occurs any Change of Control with respect to
the Borrower.

      (l) Invalidity of Loan Documents. Any Loan Document, at any time after its
execution and delivery and for any reason other than as expressly permitted
hereunder or satisfaction in full of all the Obligations, ceases to be in full
force and effect; or the Borrower or any other Person contests in any manner the
validity or enforceability of any Loan Document; or the Borrower denies that it
has any or further liability or obligation under any Loan Document, or purports
to revoke, terminate or rescind any Loan Document.

      8.02 REMEDIES UPON EVENT OF DEFAULT. If any Event of Default occurs and is
continuing, the Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders, take any or all of the following actions:

      (a) declare the commitment of each Lender to make Loans and any obligation
of the L/C Issuer to make L/C Credit Extensions to be terminated, whereupon such
commitments and obligation shall be terminated;

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

      (c) require that the Borrower Cash Collateralize the L/C Obligations (in
an amount equal to the then Outstanding Amount thereof); and

      (d) exercise on behalf of itself and the Lenders all rights and remedies
available to it and the Lenders under the Loan Documents or applicable law;

                                       55
<PAGE>
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans and any obligation of
the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans, L/C Borrowings and all
interest and other amounts as aforesaid shall automatically become due and
payable, and the obligation of the Borrower to Cash Collateralize the L/C
Obligations as aforesaid shall automatically become effective, in each case
without further act of the Administrative Agent or any Lender.

      8.03 APPLICATION OF FUNDS. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become immediately due and
payable and the L/C Obligations have automatically been required to be Cash
Collateralized as set forth in the proviso to Section 8.02), any amounts
received on account of the Obligations shall be applied by the Administrative
Agent in the following order:

      First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and amounts
payable under Article III) payable to the Administrative Agent in its capacity
as such;

      Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to the
Lenders (including Attorney Costs and amounts payable under Article III),
ratably among them in proportion to the amounts described in this clause Second
payable to them;

      Third, to payment of that portion of the Obligations constituting accrued
and unpaid interest on the Loans and L/C Borrowings, ratably among the Lenders
in proportion to the respective amounts described in this clause Third payable
to them;

      Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and L/C Borrowings, ratably among the Lenders in
proportion to the respective amounts described in this clause Fourth held by
them;

      Fifth, to the Administrative Agent for the account of the L/C Issuer, to
Cash Collateralize that portion of L/C Obligations comprised of the aggregate
undrawn amount of Letters of Credit; and

      Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.

Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fifth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.

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<PAGE>
                                  ARTICLE IX.
                              ADMINISTRATIVE AGENT

      9.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.

      (a) Each Lender hereby irrevocably appoints, designates and authorizes the
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary relationship with any Lender or participant, 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. Without limiting the generality of the foregoing sentence,
the use of the term "agent" herein and in the other Loan Documents with
reference to the Administrative Agent is not intended to connote any fiduciary
or other implied (or express) obligations arising under agency doctrine of any
applicable Law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship between
independent contracting parties.

      (b) The L/C Issuer shall act on behalf of the Lenders with respect to any
Letters of Credit issued by it and the documents associated therewith, and the
L/C Issuer shall have all of the benefits and immunities (i) provided to the
Administrative Agent in this Article IX with respect to any acts taken or
omissions suffered by the L/C Issuer in connection with Letters of Credit issued
by it or proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Letters of Credit as fully as if the term
"Administrative Agent" as used in this Article IX (including the indemnity
provision set forth in Section 9.07) included the L/C Issuer and the definition
of "Agent-Related Person" included the L/C Issuer, its Affiliates and their
respective officers, directors, employees, agents and attorneys-in-fact with
respect to such acts or omissions, and (ii) as additionally provided herein with
respect to the L/C Issuer.

      9.02 DELEGATION OF DUTIES. The Administrative Agent may execute any of its
duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel and
other consultants or experts concerning all matters pertaining to such duties.
The Administrative Agent shall not be responsible for the negligence or
misconduct of any agent or attorney-in-fact that it selects in the absence of
gross negligence or willful misconduct.

      9.03 LIABILITY OF ADMINISTRATIVE AGENT. No Agent-Related Person shall (a)
be liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except to the extent of its own gross negligence or willful
misconduct in connection with its duties expressly set forth herein), or (b) be
responsible in any manner to any Lender or participant for any recital,
statement, representation or warranty made by the Borrower or any officer
thereof, contained herein or in any other Loan Document, or in any certificate,
report, statement or other document

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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 the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Borrower or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender or participant
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 or any
Affiliate thereof.

      9.04 RELIANCE BY ADMINISTRATIVE AGENT.

      (a) The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, electronic mail message, statement or
other document or conversation believed by it 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 counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under any Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders as it deems appropriate and, if it so
requests, 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 or any other Loan Document in accordance with a request or
consent of the Required Lenders (or such greater number of Lenders as may be
expressly required hereby in any instance) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders.

      (b) For purposes of determining compliance with the conditions specified
in Section 4.01, each Lender that has signed this Agreement shall be deemed to
have consented to, approved or accepted or to be satisfied with, each document
or other matter required thereunder to be consented to or approved by or
acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.

      9.05 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default, except with respect
to defaults in the payment of principal, interest and fees required to be paid
to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a "notice of default." The Administrative Agent will notify the
Lenders of its receipt of any such notice. The Administrative Agent shall take
such action with respect to such Default as may be directed by the Required
Lenders in accordance with Article VIII; provided, however, that unless and
until the Administrative Agent has received any such direction, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default as it shall deem
advisable or in the best interest of the Lenders.

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      9.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE AGENT.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of the Borrower or any Affiliate thereof, shall be deemed
to constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed
material information in their possession. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and its Subsidiaries, and all applicable bank
or other regulatory Laws relating to the transactions contemplated hereby, and
made its own decision to enter into this Agreement and to extend credit to the
Borrower hereunder. Each Lender also represents that it will, independently and
without reliance upon any Agent-Related Person 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 investigations as
it deems necessary to inform itself as to the business, prospects, 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 herein, the Administrative
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of the Borrower or
any of its Affiliates which may come into the possession of any Agent-Related
Person.

      9.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, the Lenders shall indemnify
upon demand each Agent-Related Person (to the extent not reimbursed by or on
behalf of the Borrower and without limiting the obligation of the Borrower to do
so), pro rata, and hold harmless each Agent-Related Person from and against any
and all Indemnified Liabilities incurred by it; provided, however, that (a) no
Lender shall be liable for the payment to any Agent-Related Person of any
portion of such Indemnified Liabilities to the extent determined in a final,
nonappealable judgment by a court of competent jurisdiction to have resulted
from such Agent-Related Person's own gross negligence or willful misconduct;
provided, further, that no action taken in accordance with the directions of the
Required Lenders (or such greater number of Lenders as may be expressly required
hereby in any instance) shall be deemed to constitute gross negligence or
willful misconduct for purposes of this Section, and (b) no Lender shall be
liable for the payment of any portion of an Indemnified Liability pursuant to
this Section unless such Indemnified Liability was incurred by the
Administrative Agent in its capacity as such, the L/C Issuer in its capacity as
such, an Agent-Related Person acting for the Administrative Agent in such
capacity, or an Agent-Related Person acting for the L/C Issuer in such capacity.
Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by the Administrative
Agent in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that

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the Administrative Agent is not reimbursed for such expenses by or on behalf of
the Borrower. The undertaking in this Section shall survive termination of the
Aggregate Commitments, the payment of all other Obligations and the resignation
of the Administrative Agent.

      9.08 INDIVIDUAL CAPACITIES.

      (a) Bank of America and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Borrower and its Affiliates as though Bank of America
were not the Administrative Agent or, with respect to the Existing Letters of
Credit, the L/C Issuer hereunder and without notice to or consent of the
Lenders. The Lenders acknowledge that, pursuant to such activities, Bank of
America or its Affiliates may receive information regarding the Borrower or its
Affiliates (including information that may be subject to confidentiality
obligations in favor of the Borrower or such Affiliate) and acknowledge that the
Administrative Agent shall be under no obligation to provide such information to
them. With respect to its Loans, Bank of America shall have the same rights and
powers under this Agreement as any other Lender and may exercise such rights and
powers as though it were not the Administrative Agent or, with respect to the
Existing Letters of Credit, the L/C Issuer, and the terms "Lender" and "Lenders"
include Bank of America in its individual capacity.

      (b) Bank One and its Affiliates may make loans to, issue letters of credit
for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with the Borrower and its Affiliates as though Bank One were
not the Syndication Agent or the L/C Issuer hereunder and without notice to or
consent of the Lenders. The Lenders acknowledge that, pursuant to such
activities, Bank One or its Affiliates may receive information regarding the
Borrower or its Affiliates (including information that may be subject to
confidentiality obligations in favor of the Borrower or such Affiliate) and
acknowledge that the Syndication Agent shall be under no obligation to provide
such information to them. With respect to its Loans, Bank One shall have the
same rights and powers under this Agreement as any other Lender and may exercise
such rights and powers as though it were not the Syndication Agent or the L/C
Issuer, and the terms "Lender" and "Lenders" include Bank One in its individual
capacity.

      9.09 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may resign
as Administrative Agent upon 30 days' notice to the Lenders; provided that any
such resignation by Bank of America shall also constitute its resignation as L/C
Issuer with respect to the Existing Letters of Credit. If the Administrative
Agent resigns under this Agreement, the Required Lenders shall appoint from
among the Lenders a successor administrative agent for the Lenders, which
successor administrative agent shall be consented to by the Borrower at all
times other than during the existence of an Event of Default (which consent of
the Borrower shall not be unreasonably withheld or delayed). If no successor
administrative agent is appointed prior to the effective date of the resignation
of the Administrative Agent, the Administrative Agent may appoint, after
consulting with the Lenders and the Borrower, a successor administrative agent
from among the Lenders. Upon the acceptance of its appointment as successor
administrative agent hereunder, the Person acting as such successor
administrative agent shall succeed to all the rights, powers and duties of the
retiring Administrative Agent, the term "Administrative Agent"

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shall mean such successor administrative agent and the retiring Administrative
Agent's appointment, powers and duties as Administrative Agent shall be
terminated, and, if Bank of America is the retiring Administrative Agent and any
Existing Letters of Credit are outstanding at the time of such succession, the
term "L/C Issuer" shall no longer include Bank of America with respect to the
Existing Letters of Credit and Bank of America's rights, powers and duties as a
L/C Issuer shall be terminated, without any other or further act or deed on the
part of Bank of America or any other Lender. In such event, the Borrower shall
(x) cause the remaining L/C Issuer to issue letters of credit in substitution
for the Existing Letters of Credit outstanding at the time of such succession,
(y) Cash Collateralize such Existing Letters of Credit, or (z) make such other
arrangements as may be satisfactory to Bank of America, in its sole discretion,
with respect to such Existing Letters of Credit. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Article IX and Sections 10.04 and 10.05 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement. If no successor administrative agent
has accepted appointment as Administrative Agent by the date which is 30 days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above.

      9.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Borrower, the Administrative Agent (irrespective of
whether the principal of any Loan or L/C Obligation shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether the Administrative Agent shall have made any demand on the Borrower)
shall be entitled and empowered, by intervention in such proceeding or otherwise

            (a) to file and prove a claim for the whole amount of the principal
      and interest owing and unpaid in respect of the Loans, L/C Obligations and
      all other Obligations that are owing and unpaid and to file such other
      documents as may be necessary or advisable in order to have the claims of
      the Lenders and the Administrative Agent (including any claim for the
      reasonable compensation, expenses, disbursements and advances of the
      Lenders and the Administrative Agent and their respective agents and
      counsel and all other amounts due the Lenders and the Administrative Agent
      under Sections 2.03(i) and (j), 2.09 and 10.04) allowed in such judicial
      proceeding; and

            (b) to collect and receive any monies or other property payable or
      deliverable on any such claims and to distribute the same;

      and any custodian, receiver, assignee, trustee, liquidator, sequestrator
or other similar official in any such judicial proceeding is hereby authorized
by each Lender to make such payments to the Administrative Agent and, in the
event that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.09 and 10.04.

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      Nothing contained herein shall be deemed to authorize the Administrative
Agent to authorize or consent to or accept or adopt on behalf of any Lender any
plan of reorganization, arrangement, adjustment or composition affecting the
Obligations or the rights of any Lender or to authorize the Administrative Agent
to vote in respect of the claim of any Lender in any such proceeding.

      9.11 OTHER AGENTS; ARRANGERS AND MANAGERS. None of the Lenders or other
Persons identified on the facing page or signature pages of this Agreement as a
"syndication agent," "documentation agent," "co-agent," "book manager," "lead
manager," "arranger," "lead arranger" or "co-arranger" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than, in the case of such Lenders, those applicable to all Lenders as such and,
in the case of the Arrangers, those applicable to the Arrangers set forth in
Section 10.05. Without limiting the foregoing, none of the Lenders or other
Persons so identified shall have or be deemed to have any fiduciary relationship
with any Lender. Each Lender acknowledges that it has not relied, and will not
rely, on any of the Lenders or other Persons so identified in deciding to enter
into this Agreement or in taking or not taking action hereunder.

                                   ARTICLE X.
                                  MISCELLANEOUS

      10.01 AMENDMENTS, ETC. No amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the
Borrower therefrom, shall be effective unless in writing signed by the Required
Lenders and the Borrower and acknowledged by the Administrative Agent, and each
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given; provided, however, that no such amendment,
waiver or consent shall:

      (a) waive any condition set forth in Section 4.01(a) or extend the Letter
of Credit Expiration Date without the written consent of each Lender;

      (b) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02) without the written consent of
such Lender;

      (c) postpone any date fixed by this Agreement or any other Loan Document
for any payment of principal, interest, fees or other amounts due to the Lenders
(or any of them) hereunder or under any other Loan Document without the written
consent of each Lender directly affected thereby;

      (d) reduce the principal of, or the rate of interest specified herein on,
any Loan or L/C Borrowing, or (subject to clause (iv) of the second proviso to
this Section 10.01) any fees or other amounts payable hereunder or under any
other Loan Document without the written consent of each Lender directly affected
thereby; provided, however, that only the consent of the Required Lenders shall
be necessary to amend the definition of "Default Rate" or to waive any
obligation of the Borrower to pay interest or Letter of Credit Fees at the
Default Rate;

      (e) change Section 2.13 or Section 8.03 in a manner that would alter the
pro rata sharing of payments required thereby without the written consent of
each Lender;

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      (f) change any provision of this Section or the definition of "Required
Lenders" or any other provision hereof specifying the number or percentage of
Lenders required to amend, waive or otherwise modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender; or

      (g) change the definition of "Pro Rata Share" or any provision that would
alter the pro rata treatment of Commitment reductions or, except as contemplated
by Section 2.14, the pro rata funding of Loans or pro rata purchase of
participations in L/C Obligations, in each case without the written consent of
each Lender;

and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; (iii) Section 10.07(h) may not be amended, waived or otherwise
modified without the consent of each Granting Lender all or any part of whose
Loans are being funded by an SPC at the time of such amendment, waiver or other
modification; and (iv) the Fee Letters may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.

      10.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.

      (a) General. Unless otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including by
facsimile transmission). All such written notices shall be mailed certified or
registered mail, faxed or delivered to the applicable address, facsimile number
or (subject to subsection (c) below) electronic mail address, and all notices
and other communications expressly permitted hereunder to be given by telephone
shall be made to the applicable telephone number, as follows:

            (i) if to the Borrower, the Administrative Agent or the L/C Issuer,
      to the address, facsimile number, electronic mail address or telephone
      number specified for such Person on Schedule 10.02 or to such other
      address, facsimile number, electronic mail address or telephone number as
      shall be designated by such party in a notice to the other parties; and

            (ii) if to any other Lender, to the address, facsimile number,
      electronic mail address or telephone number specified in its
      Administrative Questionnaire or to such other address, facsimile number,
      electronic mail address or telephone number as shall be designated by such
      party in a notice to the Borrower, the Administrative Agent and the L/C
      Issuer.

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Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by facsimile shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next business day for the
recipient). Notices delivered through electronic communications to the extent
provided in subsection (b) below shall be effective as provided in such
subsection (b).

      (b) Electronic Communications. Notices and other communications to the
Lenders hereunder may be delivered or furnished by electronic communication
(including e-mail and Internet or intranet websites) pursuant to procedures
approved by the Administrative Agent, provided that the foregoing shall not
apply to notices to any Lender pursuant to Article II if such Lender has
notified the Administrative Agent that it is incapable of receiving notices
under such Article by electronic communication. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it, provided that approval of such procedures may be
limited to particular notices or communications.

      (c) Effectiveness of Facsimile Documents and Signatures. Loan Documents
may be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually-signed originals and shall be binding on the Borrower,
the Administrative Agent and the Lenders. The Administrative Agent may also
require that any such documents and signatures be confirmed by a manually-signed
original thereof; provided, however, that the failure to request or deliver the
same shall not limit the effectiveness of any facsimile document or signature.

      (d) Reliance by Administrative Agent, the L/C Issuer and Lenders. The
Administrative Agent, the L/C Issuer and the Lenders shall be entitled to rely
and act upon any notices (including telephonic Loan Notices) purportedly given
by or on behalf of the Borrower even if (i) such notices were not made in a
manner specified herein, were incomplete or were not preceded or followed by any
other form of notice specified herein, or (ii) the terms thereof, as understood
by the recipient, varied from any confirmation thereof. The Borrower shall
indemnify each Agent-Related Person, the L/C Issuer and each Lender from all
losses, costs, expenses and liabilities resulting from the reliance by such
Person on each notice purportedly given by or on behalf of the Borrower, in each
case except to the extent such losses, costs, expenses and liabilities are
determined by a court of competent jurisdiction by final and nonappealable
judgment to have resulted from the gross negligence or willful misconduct of
such Person. All telephonic notices to and other communications with the
Administrative Agent may be recorded by the Administrative Agent, and each of
the parties hereto hereby consents to such recording.

      10.03 NO WAIVER; CUMULATIVE REMEDIES. No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in exercising,
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.

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      10.04 ATTORNEY COSTS, EXPENSES AND TAXES. The Borrower agrees (a) to pay
or reimburse the Administrative Agent for all costs and expenses incurred in
connection with the development, preparation, negotiation and execution of this
Agreement and the other Loan Documents and any amendment, waiver, consent or
other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the
Administrative Agent, the L/C Issuer and each Lender for all costs and expenses
incurred in connection with the enforcement, attempted enforcement, or
preservation of any rights or remedies under this Agreement or the other Loan
Documents (including all such costs and expenses incurred during any "workout"
or restructuring in respect of the Obligations and during any legal proceeding,
including any proceeding under any Debtor Relief Law), including all Attorney
Costs. The foregoing costs and expenses shall include all search, filing,
recording, title insurance and appraisal charges and fees and taxes related
thereto, and other out-of-pocket expenses incurred by the Administrative Agent
and the cost of independent public accountants and other outside experts
retained by the Administrative Agent, the L/C Issuer or any Lender. All amounts
due under this Section 10.04 shall be payable within ten Business Days after
demand therefor. The agreements in this Section shall survive the termination of
the Aggregate Commitments and repayment of all other Obligations.

      10.05 INDEMNIFICATION BY THE BORROWER. Whether or not the transactions
contemplated hereby are consummated, the Borrower shall indemnify and hold
harmless each Agent-Related Person, each Arranger, the L/C Issuer, each Lender
and their respective Affiliates, directors, officers, employees, counsel, agents
and attorneys-in-fact (collectively the "Indemnitees") from and against any and
all liabilities, obligations, losses, damages, penalties, claims, demands,
actions, judgments, suits, costs, expenses and disbursements (including Attorney
Costs) of any kind or nature whatsoever which may at any time be imposed on,
incurred by or asserted against any such Indemnitee (including any of the
foregoing asserted by the Borrower) in any way relating to or arising out of or
in connection with (a) the execution, delivery, enforcement, performance or
administration of any Loan Document or any other agreement, letter or instrument
delivered in connection with the transactions contemplated thereby or the
consummation of the transactions contemplated thereby, (b) any Commitment, Loan
or Letter of Credit or the use or proposed use of the proceeds therefrom
(including any refusal by the L/C Issuer to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (c) any
Environmental Claim related in any way to the Borrower or any Subsidiary,
including any Environmental Claim arising from any property currently or
formerly owned or operated by the Borrower or any Subsidiary, or actual or
alleged violation of Environmental Law or (d) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory (including any investigation
of, preparation for, or defense of any pending or threatened claim,
investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"); provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses or
disbursements (x) are determined by a court of competent jurisdiction by final
and nonappealable judgment to have resulted from the gross negligence or willful
misconduct of

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such Indemnitee, or (y) result from disputes solely among the Lenders and/or the
Administrative Agent. No Indemnitee shall be liable for any damages arising from
the use by others of any information or other materials obtained through
IntraLinks or other similar information transmission systems in connection with
this Agreement, nor shall any Indemnitee have any liability for any indirect,
consequential, special or punitive damages relating to this Agreement or any
other Loan Document or arising out of its activities in connection herewith or
therewith (whether before or after the Closing Date). All amounts due under this
Section 10.05 shall be payable within ten Business Days after demand therefor.
The agreements in this Section shall survive the resignation of the
Administrative Agent, the replacement of any Lender, the termination of the
Aggregate Commitments and the repayment, satisfaction or discharge of all the
other Obligations.

      10.06 PAYMENTS SET ASIDE. To the extent that any payment by or on behalf
of the Borrower is made to the Administrative Agent, the L/C Issuer or any
Lender, or the Administrative Agent, the L/C Issuer or any Lender exercises its
right of set-off, and such payment or the proceeds of such set-off or any part
thereof is subsequently invalidated, declared to be fraudulent or preferential,
set aside or required (including pursuant to any settlement entered into by the
Administrative Agent, the L/C Issuer or such Lender in its discretion) to be
repaid to a trustee, receiver or any other party, in connection with any
proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred, and (b) each Lender
severally agrees to pay to the Administrative Agent or the L/C Issuer, as the
case may be, upon demand its applicable share of any amount so recovered from or
repaid by such Person, plus interest thereon from the date of such demand to the
date such payment is made at a rate per annum equal to the Federal Funds Rate
from time to time in effect.

      10.07 SUCCESSORS AND ASSIGNS.

      (a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that the Borrower may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation in
accordance with the provisions of subsection (d) of this Section, (iii) by way
of pledge or assignment of a security interest subject to the restrictions of
subsection (f) of this Section, or (iv) to an SPC in accordance with the
provisions of subsection (h) of this Section (and any other attempted assignment
or transfer by any party hereto shall be null and void). Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Indemnitees) any
legal or equitable right, remedy or claim under or by reason of this Agreement.

      (b) Any Lender may at any time assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans (including for purposes of this
subsection (b), participations in L/C

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<PAGE>
Obligations) at the time owing to it); provided that (i) except in the case of
an assignment of the entire remaining amount of the assigning Lender's
Commitment and the Loans at the time owing to it or in the case of an assignment
to a Lender or an Affiliate of a Lender or an Approved Fund (as defined in
subsection (g) of this Section) with respect to a Lender, the aggregate amount
of the Commitment (which for this purpose includes Loans outstanding thereunder)
subject to each such assignment, determined as of the date the Assignment and
Assumption with respect to such assignment is delivered to the Administrative
Agent or, if "Trade Date" is specified in the Assignment and Assumption, as of
the Trade Date, shall not be less than $5,000,000 unless each of the
Administrative Agent and, so long as no Event of Default has occurred and is
continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned; (iii) any assignment of a Commitment must be approved by the
Administrative Agent and the L/C Issuer unless the Person that is the proposed
assignee is itself a Lender (whether or not the proposed assignee would
otherwise qualify as an Eligible Assignee); and (iv) the parties to each
assignment shall execute and deliver to the Administrative Agent an Assignment
and Assumption, together with a processing and recordation fee of $3,500 from
the assigning Lender or the Eligible Assignee. Subject to acceptance and
recording thereof by the Administrative Agent pursuant to subsection (c) of this
Section, from and after the effective date specified in each Assignment and
Assumption, the Eligible Assignee thereunder shall be a party to this Agreement
and, to the extent of the interest assigned by such Assignment and Assumption,
have the rights and obligations of a Lender under this Agreement, and the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender's rights and obligations under this Agreement, such Lender
shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 3.01, 3.04, 3.05, 10.04 and 10.05 with respect to facts and
circumstances occurring prior to the effective date of such assignment). Upon
request, the Borrower (at its expense) shall execute and deliver a Note to the
assignee Lender. Any assignment or transfer by a Lender of rights or obligations
under this Agreement that does not comply with this subsection shall be treated
for purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with subsection (d) of this Section.

      (c) The Administrative Agent, acting solely for this purpose as an agent
of the Borrower, shall maintain at the Administrative Agent's Office a copy of
each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amounts of the Loans and L/C Obligations owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in
the Register shall be conclusive in the absence of manifest error, and the
Borrower, the Administrative Agent and the Lenders may treat each Person whose
name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice. In addition, at any time that a request for a consent for a material or
other substantive change to the Loan Documents is pending, any Lender wishing to
consult with other Lenders in connection therewith may request and receive from
the Administrative Agent a copy of the Register.

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<PAGE>
      (d) Any Lender may at any time, without the consent of, or notice to, the
Borrower or the Administrative Agent, sell participations to any Person (other
than a natural person or the Borrower or any of the Borrower's Affiliates or
Subsidiaries) (each, a "Participant") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Commitment and/or the Loans (including such Lender's participations in L/C
Obligations) owing to it); provided that (i) such Lender's obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) the Borrower, the Administrative Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment,
waiver or other modification described in the first proviso to Section 10.01
that directly affects such Participant. Subject to subsection (e) of this
Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to subsection (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 10.09 as though it were a Lender, provided
such Participant agrees to be subject to Section 2.13 as though it were a
Lender.

      (e) A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower's
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 10.15 as though
it were a Lender.

      (f) Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement (including under its Note, if
any) to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.

      (g) As used herein, the following terms have the following meanings:

            "Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
      Lender; (c) an Approved Fund; and (d) any other Person (other than a
      natural person) approved by (i) the Administrative Agent and the L/C
      Issuer, and (ii) unless an Event of Default has occurred and is
      continuing, the Borrower (each such approval not to be unreasonably
      withheld or delayed); provided that notwithstanding the foregoing,
      "Eligible Assignee" shall not include the Borrower or any of the
      Borrower's Affiliates or Subsidiaries.

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<PAGE>
            "Fund" means any Person (other than a natural person) that is (or
      will be) engaged in making, purchasing, holding or otherwise investing in
      commercial loans and similar extensions of credit in the ordinary course
      of its business.

            "Approved Fund" means any Fund that is administered or managed by
      (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
      Affiliate of an entity that administers or manages a Lender.

      (h) Notwithstanding anything to the contrary contained herein, any Lender
(a "Granting Lender") may grant to a special purpose funding vehicle identified
as such in writing from time to time by the Granting Lender to the
Administrative Agent and the Borrower (an "SPC") the option to provide all or
any part of any Loan that such Granting Lender would otherwise be obligated to
make pursuant to this Agreement; provided that (i) nothing herein shall
constitute a commitment by any SPC to fund any Loan, and (ii) if an SPC elects
not to exercise such option or otherwise fails to make all or any part of such
Loan, the Granting Lender shall be obligated to make such Loan pursuant to the
terms hereof or, if it fails to do so, to make such payment to the
Administrative Agent as is required under Section 2.13(c)(ii). Each party hereto
hereby agrees that (i) neither the grant to any SPC nor the exercise by any SPC
of such option shall increase the costs or expenses or otherwise increase or
change the obligations of the Borrower under this Agreement (including its
obligations under Section 3.04), (ii) no SPC shall be liable for any indemnity
or similar payment obligation under this Agreement for which a Lender would be
liable, and (iii) the Granting Lender shall for all purposes, including the
approval of any amendment, waiver or other modification of any provision of any
Loan Document, remain the lender of record hereunder. The making of a Loan by an
SPC hereunder shall utilize the Commitment of the Granting Lender to the same
extent, and as if, such Loan were made by such Granting Lender. In furtherance
of the foregoing, each party hereto hereby agrees (which agreement shall survive
the termination of this Agreement) that, prior to the date that is one year and
one day after the payment in full of all outstanding commercial paper or other
senior debt of any SPC, it will not institute against, or join any other Person
in instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency, or liquidation proceeding under the laws of the United States or any
State thereof. Notwithstanding anything to the contrary contained herein, any
SPC may (i) with notice to, but without prior consent of the Borrower and the
Administrative Agent and with the payment of a processing fee of $3,500, assign
all or any portion of its right to receive payment with respect to any Loan to
the Granting Lender and (ii) disclose on a confidential basis any non-public
information relating to its funding of Loans to any rating agency, commercial
paper dealer or provider of any surety or guarantee or credit or liquidity
enhancement to such SPC.

      (i) Notwithstanding anything to the contrary contained herein, if at any
time Bank of America assigns all of its Commitment and Loans pursuant to
subsection (b) above, it shall retain all the rights and obligations of the L/C
Issuer hereunder with respect to all Letters of Credit issued by it that are
outstanding as of the effective date of such assignment and all L/C Obligations
with respect thereto (including the right to require the Lenders to make Base
Rate Loans or fund risk participations in Unreimbursed Amounts pursuant to
Section 2.03(c)).

      10.08 CONFIDENTIALITY. Each of the Administrative Agent and the Lenders
agrees to maintain the confidentiality of the Information (as defined below),
except that Information may

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be disclosed (a) to its and its Affiliates and to its Affiliates' respective
partners, directors, officers, employees, agents, advisors and representatives
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory
authority (including any self-regulatory authority purporting to have
jurisdiction over it, such as the National Association of Insurance
Commissioners), (c) to the extent required by applicable laws or regulations or
by any subpoena or similar legal process, (d) to any other party hereto, (e) in
connection with the exercise of any remedies hereunder or under or any other
Loan Document or any action or proceeding relating to this Agreement or any
other Loan Documents or the enforcement of rights hereunder or thereunder, (f)
subject to an agreement containing provisions substantially the same as those of
this Section, to (i) any assignee of or Participant in, or any prospective
assignee of or Participant in, any of its rights or obligations under this
Agreement or (ii) any actual or prospective counterparty (or its advisors) to
any swap or derivative transaction relating to the Borrower and its obligations,
(g) with the consent of the Borrower, or (h) to the extent such Information (x)
becomes publicly available other than as a result of a breach of this Section or
(y) becomes available to the Administrative Agent or any Lender on a
nonconfidential basis from a source other than the Borrower. For the purposes of
this Section, "Information" means all information received from the Borrower or
any Subsidiary relating to the Borrower or any Subsidiary or any of their
respective businesses, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by the Borrower or any Subsidiary. Any Person required to maintain
the confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

      10.09 SET-OFF. In addition to any rights and remedies of the Lenders
provided by law, upon the occurrence and during the continuance of any Event of
Default, each Lender is authorized at any time and from time to time, without
prior notice to the Borrower (any such notice being waived by the Borrower to
the fullest extent permitted by law), to set off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held by,
and other indebtedness at any time owing by, such Lender to or for the credit or
the account of the Borrower against any and all Obligations owing to such Lender
hereunder or under any other Loan Document, now or hereafter existing,
irrespective of whether or not the Administrative Agent or such Lender shall
have made demand under this Agreement or any other Loan Document and although
such Obligations may be contingent or unmatured or denominated in a currency
different from that of the applicable deposit or indebtedness; provided, that
unless the Required Lenders have requested or consented to any action pursuant
to Section 8.02, the consent of the Administrative Agent shall be required for
the exercise by a Lender of its set off rights pursuant to this Section 10.09 to
the extent such rights are to be exercised with respect to contingent or
unmatured amounts, which consent may be withheld by the Administrative Agent in
its sole discretion unless the Required Lenders have directed the Administrative
Agent in writing otherwise. Each Lender agrees promptly to notify the Borrower
and the Administrative Agent after any such set-off and application made by such
Lender; provided, however, that the failure to give such notice shall not affect
the validity of such set-off and application.

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      10.10 INTEREST RATE LIMITATION. Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the "Maximum Rate"). If the Administrative Agent or
any Lender shall receive interest in an amount that exceeds the Maximum Rate,
the excess interest shall be applied to the principal of the Loans or, if it
exceeds such unpaid principal, refunded to the Borrower. In determining whether
the interest contracted for, charged, or received by the Administrative Agent or
a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated
term of the Obligations hereunder.

      10.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

      10.12 INTEGRATION. This Agreement, together with the other Loan Documents,
comprises the complete and integrated agreement of the parties on the subject
matter hereof and thereof and supersedes all prior agreements, written or oral,
on such subject matter. In the event of any conflict between the provisions of
this Agreement and those of any other Loan Document, the provisions of this
Agreement shall control; provided that the inclusion of supplemental rights or
remedies in favor of the Administrative Agent or the Lenders in any other Loan
Document shall not be deemed a conflict with this Agreement. Each Loan Document
was drafted with the joint participation of the respective parties thereto and
shall be construed neither against nor in favor of any party, but rather in
accordance with the fair meaning thereof.

      10.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by
the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.

      10.14 SEVERABILITY. If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

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<PAGE>
      10.15 TAX FORMS.

      (a)   (i) Each Lender that is not a "United States person" within the
      meaning of Section 7701(a)(30) of the Code (a "Foreign Lender") shall
      deliver to the Administrative Agent, prior to receipt of any payment
      subject to withholding under the Code (or upon accepting an assignment of
      an interest herein), two duly signed completed copies of either IRS Form
      W-8BEN or any successor thereto (relating to such Foreign Lender and
      entitling it to an exemption from, or reduction of, withholding tax on all
      payments to be made to such Foreign Lender by the Borrower pursuant to
      this Agreement) or IRS Form W-8ECI or any successor thereto (relating to
      all payments to be made to such Foreign Lender by the Borrower pursuant to
      this Agreement) or such other evidence satisfactory to the Borrower and
      the Administrative Agent that such Foreign Lender is entitled to an
      exemption from, or reduction of, U.S. withholding tax, including any
      exemption pursuant to Section 881(c) of the Code. Thereafter and from time
      to time, each such Foreign Lender shall (A) promptly submit to the
      Administrative Agent such additional duly completed and signed copies of
      one of such forms (or such successor forms as shall be adopted from time
      to time by the relevant United States taxing authorities) as may then be
      available under then current United States laws and regulations to avoid,
      or such evidence as is satisfactory to the Borrower and the Administrative
      Agent of any available exemption from or reduction of, United States
      withholding taxes in respect of all payments to be made to such Foreign
      Lender by the Borrower pursuant to this Agreement, (B) promptly notify the
      Administrative Agent of any change in circumstances which would modify or
      render invalid any claimed exemption or reduction, and (C) take such steps
      as shall not be materially disadvantageous to it, in the reasonable
      judgment of such Lender, and as may be reasonably necessary (including the
      re-designation of its Lending Office) to avoid any requirement of
      applicable Laws that the Borrower make any deduction or withholding for
      taxes from amounts payable to such Foreign Lender.

            (ii) Each Foreign Lender, to the extent it does not act or ceases to
      act for its own account with respect to any portion of any sums paid or
      payable to such Lender under any of the Loan Documents (for example, in
      the case of a typical participation by such Lender), shall deliver to the
      Administrative Agent on the date when such Foreign Lender ceases to act
      for its own account with respect to any portion of any such sums paid or
      payable, and at such other times as may be necessary in the determination
      of the Administrative Agent (in the reasonable exercise of its
      discretion), (A) two duly signed completed copies of the forms or
      statements required to be provided by such Lender as set forth above, to
      establish the portion of any such sums paid or payable with respect to
      which such Lender acts for its own account that is not subject to U.S.
      withholding tax, and (B) two duly signed completed copies of IRS Form
      W-8IMY (or any successor thereto), together with any information such
      Lender chooses to transmit with such form, and any other certificate or
      statement of exemption required under the Code, to establish that such
      Lender is not acting for its own account with respect to a portion of any
      such sums payable to such Lender.

            (iii) The Borrower shall not be required to pay any additional
      amount to any Foreign Lender under Section 3.01 (A) with respect to any
      Taxes required to be deducted

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<PAGE>
      or withheld on the basis of the information, certificates or statements of
      exemption such Lender transmits with an IRS Form W-8IMY pursuant to this
      Section 10.15(a) or (B) if such Lender shall have failed to satisfy the
      foregoing provisions of this Section 10.15(a); provided that if such
      Lender shall have satisfied the requirement of this Section 10.15(a) on
      the date such Lender became a Lender or ceased to act for its own account
      with respect to any payment under any of the Loan Documents, nothing in
      this Section 10.15(a) shall relieve the Borrower of its obligation to pay
      any amounts pursuant to Section 3.01 in the event that, as a result of any
      change in any applicable law, treaty or governmental rule, regulation or
      order, or any change in the interpretation, administration or application
      thereof, such Lender is no longer properly entitled to deliver forms,
      certificates or other evidence at a subsequent date establishing the fact
      that such Lender or other Person for the account of which such Lender
      receives any sums payable under any of the Loan Documents is not subject
      to withholding or is subject to withholding at a reduced rate.

            (iv) The Administrative Agent may, without reduction, withhold any
      Taxes required to be deducted and withheld from any payment under any of
      the Loan Documents with respect to which the Borrower is not required to
      pay additional amounts under this Section 10.15(a).

      (b) Upon the request of the Administrative Agent, each Lender that is a
"United States person" within the meaning of Section 7701(a)(30) of the Code
shall deliver to the Administrative Agent two duly signed completed copies of
IRS Form W-9. If such Lender fails to deliver such forms, then the
Administrative Agent may withhold from any interest payment to such Lender an
amount equivalent to the applicable back-up withholding tax imposed by the Code,
without reduction.

      (c) If any Governmental Authority asserts that the Administrative Agent
did not properly withhold or backup withhold, as the case may be, any tax or
other amount from payments made to or for the account of any Lender, such Lender
shall indemnify the Administrative Agent therefor, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, and costs and expenses (including
Attorney Costs) of the Administrative Agent. The obligation of the Lenders under
this Section shall survive the termination of the Aggregate Commitments,
repayment of all other Obligations hereunder and the resignation of the
Administrative Agent.

      10.16 REPLACEMENT OF LENDERS. Upon any Lender's making a claim for
compensation under Section 3.01 or 3.04, the Borrower may, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in, and consents required by, Section 10.07), all of its interests, rights and
obligations under this Agreement and the related Loan Documents to an assignee
procured by the Borrower that shall assume such obligations (which assignee may
be another Lender, if a Lender accepts such assignment), provided that:

      (a)   the Borrower shall have paid to the Administrative Agent the
            assignment fee specified in Section 10.07(b);

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<PAGE>
      (b)   such Lender shall have received payment of an amount equal to the
            outstanding principal of its Loans and L/C Advances, accrued
            interest thereon, accrued fees and all other amounts payable to it
            hereunder and under the other Loan Documents (including any amounts
            under Section 3.05) from the assignee (to the extent of such
            outstanding principal and accrued interest and fees) or the Borrower
            (in the case of all other amounts);

      (c)   such assignment does not conflict with applicable Laws; and

      (d)   the Borrower shall have provided appropriate assurances and
            indemnities (which may include letters of credit) to the L/C Issuer
            as the L/C Issuer may reasonably require with respect to any
            continuing obligation to fund participation interests in any L/C
            Obligations then outstanding.

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.

      10.17 GOVERNING LAW.

      (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT AND
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.

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

      10.18 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE

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DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT,
OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND
EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY
PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

      10.19 USA PATRIOT ACT NOTICE. Each Lender and the Administrative Agent
(for itself and not on behalf of any Lender) hereby notifies the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the "Act"), it is required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will
allow such Lender or the Administrative Agent, as applicable, to identify the
Borrower in accordance with the Act.

      10.20 TERMINATION OF EXISTING CREDIT AGREEMENT. The Borrower, the Lenders
which are parties to the Existing Credit Agreement (which Lenders constitute
"Majority Lenders" under and as defined in the Existing Credit Agreement) and
Bank of America, as Administrative Agent under the Existing Credit Agreement,
agree that on the Closing Date, the commitments under the Existing Credit
Agreement shall terminate and be of no further force or effect (without regard
to any requirement in Section 2.7 of the Existing Credit Agreement for prior
notice of termination of the commitments thereunder).

       [REMAINDER OF PAGE IS INTENTIONALLY BLANK; SIGNATURE PAGES FOLLOW]

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      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.

                                        PACTIV CORPORATION

                                        By: /S/ DAVID P. BRUSH
                                           -------------------------------------
                                        Name:  David P. Brush
                                        Title: Vice President and Treasurer

                                     S - 1
<PAGE>
                                        BANK OF AMERICA, N.A., as Administrative
                                        Agent

                                        By: /S/ JOHN W. POCALYKO
                                           -------------------------------------
                                        Name:   JOHN W. POCALYKO
                                             -----------------------------------
                                        Title:  MANAGING DIRECTOR
                                             -----------------------------------

                                        BANK OF AMERICA, N.A., as a Lender and
                                        issuer of the Existing Letters of Credit

                                        By: /S/ JOHN W. POCALYKO
                                           -------------------------------------
                                        Name:   JOHN W. POCALYKO
                                             -----------------------------------
                                        Title:  MANAGING DIRECTOR
                                             -----------------------------------

                                     S - 2
<PAGE>
                                    BANK ONE, NA, as Syndication Agent

                                    By: /S/ NATHAN L. BLOCH
                                       -----------------------------------------
                                    Name:   NATHAN L. BLOCH
                                         ---------------------------------------
                                    Title:  MANAGING DIRECTOR
                                         ---------------------------------------

                                    BANK ONE, NA, as a Lender and the L/C Issuer

                                    By: /S/ NATHAN L. BLOCH
                                       -----------------------------------------
                                    Name:   NATHAN L. BLOCH
                                         ---------------------------------------
                                    Title:  MANAGING DIRECTOR
                                         ---------------------------------------

                                     S - 3
<PAGE>
                                        BNP PARIBAS, as Co-Documentation Agent

                                        By: /S/ BARBARA V. RIVERA
                                           -------------------------------------
                                        Name:   BARBARA V. RIVERA
                                             -----------------------------------
                                        Title:  VICE PRESIDENT
                                             -----------------------------------

                                        By: /S/ PETER C. LABRIE
                                           -------------------------------------
                                        Name:   PETER C. LABRIE
                                             -----------------------------------
                                        Title:  CENTRAL REGION MANAGER
                                             -----------------------------------

                                        BNP PARIBAS, as a Lender

                                        By: /S/ BARBARA V. RIVERA
                                           -------------------------------------
                                        Name:   BARBARA V. RIVERA
                                             -----------------------------------
                                        Title:  VICE PRESIDENT
                                             -----------------------------------

                                        By: /S/ PETER C. LABRIE
                                           -------------------------------------
                                        Name:   PETER C. LABRIE
                                             -----------------------------------
                                        Title:  CENTRAL REGION MANAGER
                                             -----------------------------------

                                     S - 4
<PAGE>
                                        SUNTRUST BANK, as Co-Documentation Agent

                                        By: /S/ LINDA L. DASH
                                           -------------------------------------
                                        Name:   LINDA L. DASH
                                             -----------------------------------
                                        Title:  DIRECTOR
                                             -----------------------------------

                                        SUNTRUST BANK, as a Lender

                                        By: /S/ LINDA L. DASH
                                           -------------------------------------
                                        Name:   LINDA L. DASH
                                             -----------------------------------
                                        Title:  DIRECTOR
                                             -----------------------------------

                                     S - 5
<PAGE>
                                        CITICORP NORTH AMERICA, INC., as Co-
                                        Documentation Agent

                                        By: /S/ GEORGE F. VAN III
                                           -------------------------------------
                                        Name:   GEORGE F. VAN III
                                             -----------------------------------
                                        Title:  V.P & MANAGING DIRECTOR
                                             -----------------------------------

                                        CITICORP NORTH AMERICA, INC., as a
                                        Lender

                                        By: /S/ GEORGE F. VAN III
                                           -------------------------------------
                                        Name:   GEORGE F. VAN III
                                             -----------------------------------
                                        Title:  V.P & MANAGING DIRECTOR
                                             -----------------------------------

                                     S - 6
<PAGE>
                                        BARCLAYS BANK PLC, as a Lender

                                        By: /S/ ALISON McGUIGAN
                                           -------------------------------------
                                        Name:   ALISON McGUIGAN
                                             -----------------------------------
                                        Title:  ASSOCIATE DIRECTOR
                                             -----------------------------------

                                     S - 7
<PAGE>
                                        WACHOVIA BANK, NATIONAL ASSOCIATION,
                                        as a Lender

                                        By: /S/ SHAWN JANKO
                                           -------------------------------------
                                        Name:   SHAWN JANKO
                                             -----------------------------------
                                        Title:  VICE PRESIDENT
                                             -----------------------------------

                                     S - 8
<PAGE>
                                        THE BANK OF TOKYO MITSUBISHI, LTD.,
                                        CHICAGO BRANCH, as a Lender

                                        By: /S/ KAZUYA MATSUSHITA
                                           -------------------------------------
                                        Name:   KAZUYA MATSUSHITA
                                             -----------------------------------
                                        Title:  GENERAL MANAGER
                                             -----------------------------------

                                     S - 9
<PAGE>
                                        CALYON NEW YORK BRANCH, as a Lender

                                        By: /S/ JAMES GIBSON
                                           -------------------------------------
                                        Name:   JAMES GIBSON
                                             -----------------------------------
                                        Title:  MANAGING DIRECTOR
                                             -----------------------------------

                                        By: /S/ ROD HURST
                                           -------------------------------------
                                        Name:   ROD HURST
                                             -----------------------------------
                                        Title:  DIRECTOR
                                             -----------------------------------

                                     S - 10
<PAGE>
                                        THE BANK OF NEW YORK, as a Lender

                                        By: /S/ MARK O'CONNOR
                                           -------------------------------------
                                        Name:   MARK O'CONNOR
                                             -----------------------------------
                                        Title:  VICE PRESIDENT
                                             -----------------------------------

                                     S - 11
<PAGE>
                                        COMERICA BANK, as a Lender

                                        By: /S/ FELICIA M. MAXWELL
                                           -------------------------------------
                                        Name:   FELICIA M. MAXWELL
                                             -----------------------------------
                                        Title:  VICE PRESIDENT
                                             -----------------------------------

                                     S - 12
<PAGE>
                                        PNC BANK N.A., as a Lender

                                        By: /S/ DOROTHY G.W. BRAILER
                                           -------------------------------------
                                        Name:   DOROTHY G.W. BRAILER
                                             -----------------------------------
                                        Title:  VICE PRESIDENT
                                             -----------------------------------

                                     S - 13
<PAGE>
                                        ING CAPITAL LLC, as a Lender

                                        By: /S/ CHERYL LABELLE
                                           -------------------------------------
                                        Name:   CHERYL LABELLE
                                             -----------------------------------
                                        Title:  MANAGING DIRECTOR
                                             -----------------------------------

                                     S - 14
<PAGE>
                                                                   SCHEDULE 1.01

                           EXISTING LETTERS OF CREDIT

Letter of Credit #130995 with maximum drawings thereunder of $12,009,165.00

Letter of Credit #7404273 with maximum drawings thereunder of $838,048.00

                                       1
<PAGE>
                                                                   SCHEDULE 2.01

                                   COMMITMENTS
                               AND PRO RATA SHARES

<TABLE>
<CAPTION>
           LENDER                                                  COMMITMENT      PRO RATA SHARE
           ------                                                  ----------      --------------
<S>                                                              <C>               <C>
Bank of America, N.A                                             $ 65,000,000        10.83333333%
Bank One, NA                                                     $ 65,000,000        10.83333333%
BNP Paribas                                                      $ 60,000,000        10.00000000%
SunTrust Bank                                                    $ 60,000,000        10.00000000%
Citicorp North America, Inc.                                     $ 60,000,000        10.00000000%
Barclays Bank PLC                                                $ 42,500,000        7.083333333%
Wachovia Bank, National Association                              $ 42,500,000        7.083333333%
The Bank of Tokyo-Mitsubishi, Ltd.                               $ 42,500,000        7.083333333%
Calyon New York Branch                                           $ 32,500,000        5.416666667%
The Bank of New York                                             $ 32,500,000        5.416666667%
Comerica Bank                                                    $ 32,500,000        5.416666667%
PNC Bank N.A                                                     $ 32,500,000        5.416666667%
ING Capital LLC                                                  $ 32,500,000        5.416666667%
                                                                 ------------      -------------

                                                      TOTAL      $600,000,000      100.000000000%
</TABLE>

                                       1
<PAGE>
                                                                   SCHEDULE 5.12

                              ENVIRONMENTAL MATTERS

                                      None.

                                       1
<PAGE>
                                                                   SCHEDULE 5.15

                                  SUBSIDIARIES
                          AND OTHER EQUITY INVESTMENTS

Part (a). Subsidiaries.

See attached.

Part (b). Other Equity Investments.

      -     PCA West, Inc. owns 50% of the partnership interests of Coast
            Packaging Company, a California general partnership. J.G. Haddy
            Sales Company, an unaffiliated company, owns the remaining 50% of
            the partnership interests.

      -     Pactiv Corporation owns 62.5% of the equity interests of Zhejing
            Zhongbao Packaging (formed under the laws of the Peoples Republic of
            China) in a joint venture with non-affiliated entities.

      -     Pactiv Corporation owns 50% of the equity interests of Dongguan PCA
            packaging Co., Ltd. (formed under the laws of the Peoples Republic
            of China) in a joint venture with an unaffiliated company.

                                       1
<PAGE>
                                                                   SCHEDULE 7.02

                                 EXISTING LIENS

                                      None.

                                       1
<PAGE>
                                                                  SCHEDULE 10.02

                         ADMINISTRATIVE AGENT'S OFFICE,
                          CERTAIN ADDRESSES FOR NOTICES

PACTIV CORPORATION:

1900 West Field Court
Lake Forest, Illinois 60045
Attention:  David P. Brush
            Vice President and Treasurer
Telephone: (847) 482-3929
Facsimile: (847) 482-4870
Electronic Mail: dbrush@pactiv.com
Website Address: www.pactiv.com

ADMINISTRATIVE AGENT:

Administrative Agent's Office
(for payments and Requests for Credit Extensions):
Bank of America, N.A.
Agency Management-East
101 North Tryon Street, 15th Floor
Mail Code: NC1-001-15-04
Charlotte, NC 28255
Attention: Merci Owens
Telephone: 704.388.3225
Facsimile: 704.409.0002
Electronic Mail: merci.r.owens@bankofamerica.com
Account No.: 1366212250600
Ref: Pactiv Corporation
ABA# 026009593

Other Notices as Administrative Agent:
Bank of America, N.A.
Agency Management- East
101 North Tryon Street, 15th Floor
Mail Code: NC1-001-15-02
Charlotte, NC 28255
Attention: Kimberly D. Williams
Telephone: 704.387.5451
Facsimile: 704.409.0650
Electronic Mail: kim.williams@bankofamerica.com

                                       1
<PAGE>
BANK OF AMERICA, AS ISSUER OF THE EXISTING LETTERS OF CREDIT:

Bank of America, N.A.
Trade Operations-Los Angeles #22621
333 S. Beaudry Avenue, 19th Floor
Mail Code: CA9-703-19-23
Los Angeles, CA 90017-1466
Attention: Sandra Leon
           Vice President
Telephone: 213.345.5231
Facsimile: 213.345.6694
Electronic Mail: Sandra.Leon@bankofamerica.com

BANK ONE, NA, AS THE L/C ISSUER:

Bank One, NA
300 South Riverside Plaza
7th Floor, Mail Code IL1-0236
Chicago, IL 60606-0236
Attention: Team Three/Evelyn Abbasi/Anne Fritz
Telephone: 312-954-1903/312-954-1849
Fax: 312-954-5986/312-954-3621
Electronic Mail: Evelyn_D_Abbasi@bankone.com/Anne_W_Fritz@bankone.com
Account No. 75217657
Ref. Pactiv
ABA#071000013

                                       2
<PAGE>
                                                                       EXHIBIT A

                               FORM OF LOAN NOTICE

                                                        Date: ___________, _____

To:   Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

      Reference is made to that certain Credit Agreement, dated as of May 27,
2004 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the "Agreement;" the terms defined therein being used
herein as therein defined), among Pactiv Corporation, a Delaware corporation
(the "Borrower"), the Lenders from time to time party thereto, Bank of America,
N.A., as Administrative Agent, and Bank One, NA, as Syndication Agent and the
L/C Issuer.

      The undersigned hereby requests (select one):

      |_|   A Borrowing of Loans     |_|  A conversion or continuation of Loans

      1.    On ______________________________ (a Business Day).

      2.    In the amount of $_______________.

      3.    Comprised of ________________________________________.
                                  [Type of Loan requested]

      4.    For Eurodollar Rate Loans: with an Interest Period of __________
            months.

      [THE BORROWING REQUESTED HEREIN COMPLIES WITH THE PROVISO TO THE FIRST
SENTENCE OF SECTION 2.01 OF THE AGREEMENT.]

                                               PACTIV CORPORATION

                                               By:______________________________

                                               Name:____________________________

                                               Title:___________________________

                                      A-1
                               Form of Loan Notice
<PAGE>
                                                                       EXHIBIT B

                                  FORM OF NOTE

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

      FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby promises to
pay to _____________________ or registered assigns (the "Lender"), in accordance
with the provisions of the Agreement (as hereinafter defined), the principal
amount of each Loan from time to time made by the Lender to the Borrower under
that certain Credit Agreement, dated as of May 27, 2004 (as amended, restated,
extended, supplemented or otherwise modified in writing from time to time, the
"Agreement;" the terms defined therein being used herein as therein defined),
among the Borrower, the Lenders from time to time party thereto, Bank of
America, N.A., as Administrative Agent, and Bank One, NA, as Syndication Agent
and the L/C Issuer.

      The Borrower promises to pay interest on the unpaid principal amount of
each Loan from the date of such Loan until such principal amount is paid in
full, at such interest rates and at such times as provided in the Agreement. All
payments of principal and interest shall be made to the Administrative Agent for
the account of the Lender in Dollars in immediately available funds at the
Administrative Agent's Office. If any amount is not paid in full when due
hereunder, such unpaid amount shall bear interest, to be paid upon demand, from
the due date thereof until the date of actual payment (and before as well as
after judgment) computed at the per annum rate set forth in the Agreement.

      This Note is one of the Notes referred to in the Agreement, is entitled to
the benefits thereof and may be prepaid in whole or in part subject to the terms
and conditions provided therein. Upon the occurrence and continuation of one or
more of the Events of Default specified in the Agreement, all amounts then
remaining unpaid on this Note shall become, or may be declared to be,
immediately due and payable all as provided in the Agreement. Loans made by the
Lender shall be evidenced by one or more loan accounts or records maintained by
the Lender in the ordinary course of business. The Lender may also attach
schedules to this Note and endorse thereon the date, amount and maturity of its
Loans and payments with respect thereto.

      The Borrower, for itself, its successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Note.

      THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK.

                                               PACTIV CORPORATION

                                               By:______________________________

                                               Name:____________________________

                                               Title:___________________________

                                       B-1
                                  Form of Note
<PAGE>
                     LOANS AND PAYMENTS WITH RESPECT THERETO

<TABLE>
<CAPTION>
                                                               AMOUNT OF      OUTSTANDING
                                                END OF       PRINCIPAL OR      PRINCIPAL
                    TYPE OF      AMOUNT OF     INTEREST      INTEREST PAID      BALANCE        NOTATION
     DATE          LOAN MADE     LOAN MADE      PERIOD        THIS DATE        THIS DATE       MADE BY
     ----          ---------     ---------      ------        ---------        ---------       -------
<S>                <C>           <C>           <C>           <C>              <C>              <C>

</TABLE>

                                       B-2
                                  Form of Note
<PAGE>
                                                                       EXHIBIT C

                         FORM OF COMPLIANCE CERTIFICATE

                                     Financial Statement Date: __________, _____

To:   Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

      Reference is made to that certain Credit Agreement, dated as of May 27,
2004 (as amended, restated, extended, supplemented or otherwise modified in
writing from time to time, the "Agreement;" the terms defined therein being used
herein as therein defined), among Pactiv Corporation, a Delaware corporation
(the "Borrower"), the Lenders from time to time party thereto, Bank of America,
N.A., as Administrative Agent, and Bank One, NA, as Syndication Agent and the
L/C Issuer.

      The undersigned Responsible Officer hereby certifies as of the date hereof
that he/she is the _____________________________________________ of the
Borrower, and that, as such, he/she is authorized to execute and deliver this
Certificate to the Administrative Agent on the behalf of the Borrower, and that:

[Use following paragraph 1 for fiscal YEAR-END financial statements]

      1. Attached hereto as Schedule 1 are the year-end audited financial
statements required by Section 6.01(a) of the Agreement for the fiscal year of
the Borrower ended as of the above date, together with the report and opinion of
an independent certified public accountant required by such section.

[Use following paragraph 1 for fiscal QUARTER-END financial statements]

      1. Attached hereto as Schedule 1 are the unaudited financial statements
required by Section 6.01(b) of the Agreement for the fiscal quarter of the
Borrower ended as of the above date. Such financial statements fairly present
the financial condition, results of operations and cash flows of the Borrower
and its Subsidiaries in accordance with GAAP as at such date and for such
period, subject only to normal year-end audit adjustments and the absence of
footnotes.

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

      3. A review of the activities of the Borrower during such fiscal period
has been made under the supervision of the undersigned with a view to
determining whether during such fiscal period the Borrower performed and
observed all its Obligations under the Loan Documents, and

                                       C-1
                         Form of Compliance Certificate
<PAGE>
                                  [SELECT ONE:]

[TO THE BEST KNOWLEDGE OF THE UNDERSIGNED DURING SUCH FISCAL PERIOD, THE
BORROWER PERFORMED AND OBSERVED EACH COVENANT AND CONDITION OF THE LOAN
DOCUMENTS APPLICABLE TO IT.]

                                     --OR--

[THE FOLLOWING COVENANTS OR CONDITIONS HAVE NOT BEEN PERFORMED OR OBSERVED AND
THE FOLLOWING IS A LIST OF EACH SUCH DEFAULT AND ITS NATURE AND STATUS:]

      4. The representations and warranties of the Borrower contained in Article
V of the Agreement, and any representations and warranties of the Borrower that
are contained in any document furnished at any time under or in connection with
the Loan Documents, are true and correct on and as of the date hereof, except to
the extent that such representations and warranties specifically refer to an
earlier date, in which case they are true and correct as of such earlier date,
and except that for purposes of this Compliance Certificate, the representations
and warranties contained in subsections (a) and (b) of Section 5.11 of the
Agreement shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a) and (b), respectively, of Section 6.01 of the Agreement,
including the statements in connection with which this Compliance Certificate is
delivered.

      5. The financial covenant analyses and information set forth on Schedules
2 and 3 attached hereto are true and accurate on and as of the date of this
Certificate.

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

                                               PACTIV CORPORATION

                                               By:______________________________

                                               Name:____________________________

                                               Title:___________________________

                                       C-2
                         Form of Compliance Certificate
<PAGE>
                For the Quarter/Year ended ___________________("Statement Date")

                                   SCHEDULE 2
                          to the Compliance Certificate
                                  ($ in 000's)

I.    SECTION 7.01(A) - MINIMUM INTEREST COVERAGE RATIO.

<TABLE>
<S>                                                                                 <C>
      A.    Consolidated EBITDA for four consecutive fiscal quarters ending on
            above date ("Subject Period"):

            1.    Consolidated Net Income for Subject Period (see Schedule 3
                  attached hereto):                                                    $__________

            2.    Consolidated Interest Expense for Subject Period:                    $__________

            3.    Provision for income taxes for Subject Period:                       $__________

            4.    Depreciation expenses for Subject Period:                            $__________

            5.    Amortization expenses for Subject Period:                            $__________

            6.    Minority interest expense for Subject Period:                        $__________

            7.    Consolidated EBITDA (Lines I.A.1 + 2 + 3 + 4 + 5 + 6 ):              $__________

      B.    Consolidated Interest Expense for Subject Period:                          $__________

      C.    Interest Coverage Ratio (Line I.A.7 / Line I.B):                        ______ to 1.00

            Minimum required:                                                         3.50 to 1.00
</TABLE>

II.   SECTION 7.01(B) - MAXIMUM TOTAL DEBT TO EBITDA RATIO.

<TABLE>
<S>                                                                                 <C>
      A.    Total Debt at Statement Date:                                              $__________

      B.    Consolidated EBITDA for Subject Period (Line I.A.7 above):                 $__________

      C.    Consolidated Leverage Ratio (Line II.A / Line II.B):                    ______ to 1.00

            Maximum permitted:                                                        3.25 to 1.00
</TABLE>

                                       C-3
                         Form of Compliance Certificate
<PAGE>
                   For the Quarter/Year ended _______________ ("Statement Date")

                                   SCHEDULE 3
                          to the Compliance Certificate
                                  ($ in 000's)
                             CONSOLIDATED NET INCOME
          (in accordance with the definition of Consolidated Net Income
                         as set forth in the Agreement)

<TABLE>
<CAPTION>
                                                                                                          Twelve
                                   Quarter            Quarter           Quarter          Quarter          Months
                                    Ended              Ended             Ended            Ended            Ended
                                   -------            -------           -------          -------          ------
<S>                                <C>                <C>               <C>              <C>              <C>
Consolidated Net
Income per GAAP

+ non-recurring non-cash
losses and extraordinary
non-cash losses

+ One Time Charges

+ Specified Non-Recurring
Cash Items(1)

- non-recurring non-cash
gains and extraordinary
non-cash gains

- cash expenditures related
to non-cash, non-recurring
losses or non-cash,
extraordinary losses added
back to net income during
any prior period
</TABLE>

----------
      (1) May not to exceed (x) $50,000,000 in the aggregate in any fiscal year
except that any portion of such $50,000,000 amount not so utilized in the fiscal
year for which it is permitted may be carried over to be utilized in the next
following fiscal year, or (y) $250,000,000 in the aggregate while the Credit
Agreement is in effect

                                       C-4
                         Form of Compliance Certificate
<PAGE>
                                                                       EXHIBIT D

                            ASSIGNMENT AND ASSUMPTION

      This Assignment and Assumption (this "Assignment and Assumption") is dated
as of the Effective Date set forth below and is entered into by and between
[Insert name of Assignor] (the "Assignor") and [Insert name of Assignee] (the
"Assignee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (the "Credit
Agreement"), receipt of a copy of which is hereby acknowledged by the Assignee.
The Standard Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.

      For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Administrative Agent as contemplated below (i) all of the Assignor's rights
and obligations as a Lender under the Credit Agreement and any other documents
or instruments delivered pursuant thereto to the extent related to the amount
and percentage interest identified below of all of such outstanding rights and
obligations of the Assignor under the respective facilities identified below
(including, without limitation, the Letters of Credit included in such
facilities) and (ii) to the extent permitted to be assigned under applicable
law, all claims, suits, causes of action and any other right of the Assignor (in
its capacity as a Lender) against any Person, whether known or unknown, arising
under or in connection with the Credit Agreement, any other documents or
instruments delivered pursuant thereto or the loan transactions governed thereby
or in any way based on or related to any of the foregoing, including, but not
limited to, contract claims, tort claims, malpractice claims, statutory claims
and all other claims at law or in equity related to the rights and obligations
sold and assigned pursuant to clause (i) above (the rights and obligations sold
and assigned pursuant to clauses (i) and (ii) above being referred to herein
collectively as, the "Assigned Interest"). Such sale and assignment is without
recourse to the Assignor and, except as expressly provided in this Assignment
and Assumption, without representation or warranty by the Assignor.

1.    Assignor:                   ______________________________

2.    Assignee:                   ______________________________ [and is an
                                  Affiliate/Approved Fund of [identify Lender]]

3.    Borrower:                   Pactiv Corporation, a Delaware corporation

4.    Administrative Agent:       Bank of America, N.A., as the administrative
                                  agent under the Credit Agreement

5.    Credit Agreement:           Credit Agreement, dated as of May 27, 2004,
                                  among Pactiv Corporation, a Delaware
                                  corporation, the Lenders from time to time
                                  party thereto, Bank of America, N.A., as
                                  Administrative Agent, and Bank One, NA, as
                                  Syndication Agent and the L/C Issuer

                                       D-1
                            Assignment and Assumption
<PAGE>
6.    Assigned Interest:

<TABLE>
<CAPTION>
         AGGREGATE AMOUNT OF        AMOUNT OF           PERCENTAGE
             COMMITMENTS           COMMITMENT/          ASSIGNED OF        CUSIP
          FOR ALL LENDERS*          ASSIGNED*           COMMITMENT        NUMBER
         -------------------       -----------          -----------       ------
<S>                               <C>                  <C>                <C>
            $___________          $___________         ____________%
            $___________          $___________         ____________%
            $___________          $___________         ____________%
</TABLE>

      *     Amount to be adjusted by the counterparties to take into account any
            payments or prepayments made between the Trade Date and the
            Effective Date.

[7.   Trade Date:       __________________]

Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT
AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER
THEREFOR.]

      The terms set forth in this Assignment and Assumption are hereby agreed
to:

                                             ASSIGNOR

                                             [NAME OF ASSIGNOR]

                                             By: _______________________________
                                                 Title:

                                             ASSIGNEE

                                             [NAME OF ASSIGNEE]

                                             By: _______________________________
                                                 Title:

                                       D-2
                            Assignment and Assumption
<PAGE>
[CONSENTED TO AND] Accepted:

BANK OF AMERICA, N.A.,
as Administrative Agent

By: _____________________________
    Title:

[CONSENTED TO:]

By: _____________________________
    Title:

                                       D-3
                            Assignment and Assumption
<PAGE>
                                            ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

                        STANDARD TERMS AND CONDITIONS FOR
                            ASSIGNMENT AND ASSUMPTION

      1. Representations and Warranties.

      1.1. Assignor. The Assignor (a) represents and warrants that (i) it is the
legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest
is free and clear of any lien, encumbrance or other adverse claim and (iii) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.

      1.2. Assignee. The Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all requirements of an Eligible Assignee under the Credit Agreement
(subject to receipt of such consents as may be required under the Credit
Agreement), (iii) from and after the Effective Date, it shall be bound by the
provisions of the Credit Agreement as a Lender thereunder and, to the extent of
the Assigned Interest, shall have the obligations of a Lender thereunder, (iv)
it has received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 6.01 thereof, as
applicable, and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Assumption and to purchase the Assigned Interest on the basis of
which it has made such analysis and decision independently and without reliance
on the Administrative Agent or any other Lender, and (v) if it is a Foreign
Lender, attached hereto is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
the Assignee; and (b) agrees that (i) it will, independently and without
reliance on the Administrative Agent, the Assignor or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.

      2. Payments. From and after the Effective Date, the Administrative Agent
shall make all payments in respect of the Assigned Interest (including payments
of principal, interest, fees and other amounts) to the Assignor for amounts
which have accrued to the Effective Date and to the Assignee for amounts which
have accrued from and after the Effective Date.

                                       D-4
                            Assignment and Assumption
<PAGE>
      3. General Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be executed in any
number of counterparts, which together shall constitute one instrument. Delivery
of an executed counterpart of a signature page of this Assignment and Assumption
by telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of New York.

                                       D-5
                            Assignment and Assumption
<PAGE>
                                                                       EXHIBIT E

                                 OPINION MATTERS

                                [To be attached]

                                       E-1
                                 Opinion Matters
<PAGE>
                                                                       EXHIBIT F

                 FORM OF REPORT OF LETTER OF CREDIT INFORMATION

TO:          BANK OF AMERICA, N.A. AS ADMINISTRATIVE AGENT
ATTN:        MERCI OWENS
PHONE NO.:   704-388-3225
FAX NO.:     704-409-0002

REF.:        OUTSTANDING LETTERS OF CREDIT
             ISSUED FOR THE ACCOUNT OF PACTIV CORPORATION
             UNDER THE CREDIT AGREEMENT DATED AS OF MAY 27, 2004

Reporting Period :___/___/200__ through___/___/200__

<TABLE>
<CAPTION>
                                           Escalating
                                    If       Y/N(?)                                               Auto              Amount
            Maximum    Current   "Split",    If "Y"                                              Renewal   Date of    of     Type of
             Face       Face     Pactiv's    Provide    Beneficiary   Issuance  Expiry   Auto    Period/    Amend   Amend-    Amend
 L/C No.    Amount     Amount        %      Schedule*       Name        Date     Date   Renewal   Notice    -ment    ment     -ment
 -------    -------    -------   --------   ---------   -----------   --------  ------  -------  -------   -------  -------  -------
<S>         <C>        <C>       <C>       <C>          <C>           <C>       <C>     <C>      <C>       <C>      <C>      <C>

</TABLE>

                                       F-1
                 Form of Report of Letter of Credit Information

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