Document:

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                                                                   Exhibit 10.14

             LETTER OF CREDIT REIMBURSEMENT AND PLEDGE AGREEMENT

                            Dated as of June 20, 2003

                                      among

                         MONTPELIER REINSURANCE LTD.,

                   THE LENDERS LISTED ON SCHEDULE I HERETO

                                       and

FLEET NATIONAL BANK, as Administrative Agent for itself and the other lending
                          institutions party thereto

                   with FLEET SECURITIES, INC. as Arranger
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                                    Exhibits

Exhibit A       Form of Assignment and Acceptance
Exhibit B       Control Agreement
Exhibit C       Form of Letter of Credit Application
Exhibit D       Form of Compliance Certificate
Exhibit E       Pledged Collateral Certificate

                                  Schedules

Schedule 1      Lenders and Commitments
Schedule 2.1.1  Existing Letters of Credit to become Tranche A Letters of Credit
Schedule 4.1    Property Held in Securities Account
Schedule 5.6    Litigation
Schedule 5.12   Security Interests; Financing Statements
Schedule 5.15   Subsidiaries, Etc.
Schedule 8      Financial Covenants
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               LETTER OF CREDIT REIMBURSEMENT AND PLEDGE AGREEMENT

      This LETTER OF CREDIT REIMBURSEMENT AND PLEDGE AGREEMENT is made as of
June 20, 2003, by and among Montpelier Reinsurance Ltd. (the "Borrower"), a
limited liability company duly incorporated as an exempted company under the
laws of Bermuda, having its registered office at 8 Par-La-Ville Road, Hamilton,
HM 08, Bermuda, the lending institutions listed on Schedule 1 (the "Lenders")
and Fleet National Bank, a national banking association, as administrative agent
for itself and such other lending institutions (the "Administrative Agent").

      WHEREAS, pursuant to that certain letter of credit facility established by
Fleet National Bank in favor of the Borrower (the "Facility"), Fleet National
Bank (in its capacity as issuer of such letters of credit, "FNB") issued, for
the account of the Borrower, the letters of credit described on Schedule 2.1.1
hereto (the "Existing Letters of Credit");

      WHEREAS, as set forth in Section 2.1.1 the Existing Letters of Credit
shall be Tranche A Letters of Credit under this Reimbursement and Pledge
Agreement; and

      NOW THEREFORE, in consideration of the premises and the mutual agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

      1A. TRANSITIONAL ARRANGEMENTS. FNB, as issuing lender of the Existing
Letters of Credit under the Facility hereby assigns to the Administrative Agent
for the benefit of the Lenders and to secure the Obligations hereunder (i) all
of its right, title, and interest in and to the Facility (including, without
limitation, its right, title and interest in and to the Pledge Agreement, dated
as of February 26, 2002 between the Borrower and Fleet National Bank (as
amended, the "Existing Pledge Agreement"), (ii) all liens, security interests
and charges granted to, and collateral security held by, FNB in respect of the
Existing Letters of Credit, and (iii) all right, title and interest of FNB in
and to that certain Control Agreement, dated as of April 3, 2003, among the
Borrower, FNB and the Custodian (the "Existing Control Agreement"). Effective
immediately upon the Closing Date, (i) the terms and conditions of the Existing
Pledge Agreement shall be amended and restated as set forth herein and the
Existing Pledge Agreement shall be superseded by this Reimbursement and Pledge
Agreement and (ii) the terms and conditions of the Existing Control Agreement
shall be amended and restated as set
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                                       -2-

forth in the Control Agreement and the Existing Control Agreement shall be
superseded by the Control Agreement.

                   1. DEFINITIONS AND RULES OF INTERPRETATION.

      1.1. DEFINITIONS. The following terms shall have the meanings set forth in
this Section 1 or elsewhere in the provisions of this Reimbursement and Pledge
Agreement referred to below:

      Acceding Bank. See Section 2.1.3.

      Administrative Agent's Office. The Administrative Agent's office located
at 100 Federal Street, Boston, Massachusetts 02110, or at such other location as
the Administrative Agent may designate from time to time.

      Administrative Agent. Fleet National Bank, acting as agent for the Lenders
and each other Person appointed as the successor Administrative Agent in
accordance with Section 12.9.

      Administrative Agent's Special Counsel. Bingham McCutchen LLP or such
other counsel as may be approved by the Administrative Agent.

      Administrative Questionnaire. An Administrative Questionnaire in a form
supplied by the Administrative Agent.

      Affiliate. Any Person that would be considered to be an affiliate of any
other Person under Rule 144(a) of the Rules and Regulations promulgated under
the Securities Act of 1933, as amended, if such Person were issuing securities
or any Person which, directly or indirectly, controls, is controlled by or is
under common control with such Person. "Control" of a Person means the power,
directly or indirectly, (a) to vote ten percent (10%) or more of the Capital
Stock (on a fully diluted basis) of such Person having ordinary voting power for
the election of directors, managing members or general partners (as applicable);
or (b) to direct or cause the direction of the management and policies of such
Person (whether by contract or otherwise).

      Aggregate Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as such
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.

      Agent for Service. See Section 14.15.
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      A.M. Best Rating. The financial strength rating issued with respect to the
Borrower by A.M. Best Company.

      Approved Fund. 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.

      Arranger. Fleet Securities, Inc.

      Assignment and Acceptance. An assignment and acceptance entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is
required by Section 13.2), and accepted by the Administrative Agent, in
substantially the form of Exhibit A or any other form approved by the
Administrative Agent.

      Balance Sheet Date. December 31, 2002.

      Base Rate. The higher of (a) the variable annual rate of interest so
designated from time to time by Fleet as its "prime rate", such rate being a
reference rate and not necessarily representing the lowest or best rate being
charged to any customer, and (b) one-half of one percent (-%) above the Federal
Funds Effective Rate. For the purposes of this definition, "Federal Funds
Effective Rate" shall mean 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, as published for such
day (or, if such day is not a Business Day, for the preceding Business Day) by
the Federal Reserve Administrative Agent of New York, or, if such rate is not so
published for any day that is a Business Day, the average of the quotations for
such day on such transactions received by the Administrative Agent from three
funds brokers of recognized standing selected by the Administrative Agent.
Changes in the Base Rate resulting from any changes in Fleet's "prime rate"
shall take place at the opening of business on the day of any change established
by Fleet in the ordinary course of its business.

      Borrower. As defined in the preamble hereto.

      Business Day. Any day on which banking institutions in Boston,
Massachusetts and Bermuda are open for the transaction of banking business.

      Capital Stock. Any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a
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                                       -4-

corporation) and any and all warrants, rights or options to purchase any of the
foregoing.

      Change in Control. Any of (a) any sale, lease, exchange or other transfer
(in one transaction or a series of related transactions) of all, or
substantially all, of the assets of the Borrower occurs; (b) any "person" as
such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of
1934 (the "Exchange Act") other than the Parent or White Mountains Insurance
Group Ltd., is or becomes, directly or indirectly, the "beneficial owner," as
defined in Rule 13d-3 under the Exchange Act, of securities of the Borrower that
represent 51% or more of the combined voting power of the Borrower's then
outstanding securities; (c) during any period of two consecutive years,
individuals who at the beginning of such period constituted the Board of
Directors of the Borrower (together with any new or replacement directors whose
election by the Board of Directors or whose nomination by the stockholders of
the Borrower was approved by a vote of a majority of the Directors of the
Borrower then still in office who are either directors or replacement 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
Borrower's Board of Directors then in office; (d) the Parent ceases to (x) be
the single largest shareholder of the Borrower or (y) be directly or indirectly,
the "beneficial owner," as defined in Rule 13d-3 under the Exchange Act, of
securities of the Borrower that represent 10% or more of the combined voting
power of the Borrower's then outstanding securities; or (e) White Mountain
Insurance Group Ltd. ceases to (x) be the single largest shareholder of the
Parent or (y) be directly or indirectly, the "beneficial owner," as defined in
Rule 13d-3 under the Exchange Act, of securities of the Parent that represent
10% or more of the combined voting power of the Parent's then outstanding
securities.

      Closing Date. The first date on which the conditions set forth in Section
9 have been satisfied and any Letter of Credit is to be issued hereunder.

      Code. The Internal Revenue Code of 1986, as amended from time to time, and
regulations promulgated thereunder.

      Collateral Coverage Amount. See Section 6.8.

      Combined or combined. With reference to any term defined herein, shall
mean that term as applied to the accounts of the Parent and its Subsidiaries,
combined in accordance with GAAP.

      Commitment. With respect to each Lender, such Lender's Tranche A
Commitment and/or Tranche B Commitment, as the case may be.
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      Commitment Increase Notice. See Section 2.1.3.

      Commitment Maturity Date. June 18, 2004, as such may be extended pursuant
to Section 2.1.5 hereof.

      Commitment Percentage. With respect to each Lender, such Lender's Tranche
A Commitment Percentage and/or Tranche B Commitment Percentage, as the case may
be.

      Compliance Certificate. See Section 6.4(d).

      Control Agreement. That certain Amended and Restated Control Agreement,
dated as of June 20, 2003 among the Administrative Agent, the Borrower and the
Custodian and attached hereto as Exhibit B.

      Consolidated or consolidated. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Parent and its
Subsidiaries, consolidated in accordance with GAAP.

      Cure Contribution. Capital contributions or other equity infusions to the
Parent made on or before the 30th day after the date the Borrower has failed to
comply with the covenant set forth in Section 8.1 of Schedule 8, which cure such
default.

      Custodial Lien and Set-off Rights. See Section 5.13.

      Custodian. The Bank of New York

      Default. Any event which would, with the giving of notice or the lapse of
time, constitute an Event of Default.

      Delinquent Lender. See Section 12.5.3.

      Deposit Account. The Borrower's demand deposit account no. 251473 and any
replacement or successor account maintained with the Custodian and subject to
the terms of the Control Agreement.

      Dollars or $. Dollars in lawful currency of the United States of America.

      Dollar Equivalent. On any particular date, with respect to any amount
denominated in Dollars, such amount in Dollars, and with respect to any amount
denominated in Pounds Sterling, the amount (as conclusively ascertained by the
Administrative Agent absent manifest error) of Dollars which could be purchased
by the Administrative Agent (in accordance with its normal banking practices) in
the London foreign currency deposit markets with such amount of such currency at
the spot
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                                       -6-

rate of exchange prevailing at or about 11:00 a.m. (London time) on such date.

      Effective Commitment Amount. See Section 2.1.3.

      Eligible Assignee. Any of (a) a Lender, (b) an Affiliate of a Lender or
(c) a financial institution having a senior unsecured debt rating of not less
than "A", or its equivalent, by S&P and (d) any other Person (other than a
natural person) approved by (i) the Administrative Agent and (ii) unless a
Default or an Event of Default has occurred and is continuing, the Borrower
(with each such approval not to be unreasonably withheld or delayed).

      Event of Default. See Section 11.1.

      Existing Letters of Credit. As defined in the recitals hereto.

      Existing Pledge Agreement. See Section 1A.

      Extension. See Section 2.1.5.

      Facility. As defined in the recitals hereto.

      Facility Fee. See Section 2.8.

      Federal Agency. Any of the following agencies of the federal government of
the United States: (a) Government National Mortgage Association; (b) the
Export-Import Bank of the United States; (c) the Farmers Home Administration, an
agency of the United States Department of Agriculture; (d) the United States
General Services Administration; (e) the United States Maritime Administration;
(f) the United States Small Business Administration; (g) the Commodity Credit
Corporation; (h) the Rural Electrification Administration; (i) the Rural
Telephone Bank; (j) Washington Metropolitan Area Transit Authority; (k) the
Federal Home Loan Mortgage Corporation; (l) the Federal National Mortgage
Association; (m) the Federal Housing Finance Board; (n) the Federal Home Loan
Bank and (o) such other federal agencies as are reasonably acceptable to the
Administrative Agent.

      Federal Agency Collateral. See Section 6.8.

      Fee Letter. The fee letter dated as of June 20, 2003 among the Borrower,
the Administrative Agent and the Arranger.

      Fees. The Letter of Credit Fee and the Facility Fee.
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      Financial Affiliate. A Subsidiary of the bank holding company controlling
any Lender, which Subsidiary is engaging in any of the activities permitted
by Section 4(e) of the Administrative Agent Holding Company Act of 1956 (12
U.S.C. Section 1843).

      Fleet. Fleet National Bank, a national banking association, in its
individual capacity.

      FNB. As defined in the recitals hereto.

      Freely Transferable. Securities which are freely transferable and traded
in established and recognized markets and as to which there are readily
available price quotations.

      Fund. 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.

      GAAP or generally accepted accounting principles. (a) When used in
Section 6, whether directly or indirectly through reference to a capitalized
term used therein, means (i) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date, and
(ii) to the extent consistent with such principles, the accounting practice of
the Parent reflected in its financial statements for the year ended on the
Balance Sheet Date, and (b) when used in general, other than as provided above,
means principles that are (i) consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors, as in
effect from time to time, and (ii) consistently applied with past financial
statements of the Parent adopting the same principles, provided that in each
case referred to in this definition of "GAAP" a certified public accountant
would, insofar as the use of such accounting principles is pertinent, be in a
position to deliver an unqualified opinion (other than a qualification regarding
changes in GAAP) as to financial statements in which such principles have been
properly applied.

      Governing Documents. With respect to any Person, its certificate or
articles of incorporation, memorandum of association, certificate of formation,
or, as the case may be, certificate of limited partnership, its by-laws,
operating agreement or, as the case may be, partnership agreement or other
constitutive documents and all shareholder agreements, voting trusts and similar
arrangements applicable to any of its Capital Stock.
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                                       -8-

      Governmental Authority. Any foreign, federal, state, regional, local,
municipal or other government, or any department, commission, board, bureau,
agency, public authority or instrumentality thereof or any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government or any court or arbitrator.

      Indemnified Persons. See Section 14.5(a)

      Indemnitee. See Section 14.4

      Ineligible Securities. Securities which may not be underwritten or dealt
in by member Administrative Agents of the Federal Reserve System under Section
16 of the Banking Act of 1933 (12 U.S.C. Section 24, Seventh), as amended.

      Insurance Subsidiary. The Borrower and any other Subsidiary of the Parent
created after the Closing Date which is licensed by any Governmental Authority
to engage in the insurance business.

      Lender Affiliate. With respect to any Lender, (a) an Affiliate of such
Lender or (b) any Approved Fund.

      Lender Increase Notice. See Section 2.1.3.

      Lenders. Fleet and the other lending institutions listed on Schedule 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Lender pursuant to Section 13.

      Letters of Credit. The Tranche A Letters of Credit and the Tranche B
Letters of Credit.

      Letter of Credit Application. See Section 2.1.1.

      Letter of Credit Fee. See Section 2.8.

      Letter of Credit Participation. See Section 2.1.6.

      Lloyd's. Lloyd's of London or members of its syndicate.

      Loan Documents. This Reimbursement and Pledge Agreement, the Letter of
Credit Applications, the Letters of Credit and the Control Agreement.

      Material Adverse Effect. With respect to any event or occurrence of
whatever nature (including any adverse determination in any litigation,
arbitration or governmental investigation or proceeding) which results in:
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      (a) a material adverse effect on the business, properties, condition
(financial or otherwise), assets, operations or income of the Borrower,
individually or the Borrower and its Subsidiaries, taken as a whole;

      (b) a material adverse effect on the ability of the Borrower to perform
any of its Obligations under any of the Loan Documents to which it is a party;
or

      (c) any impairment of the validity, binding effect or enforceability of
this Reimbursement and Pledge Agreement or any of the other Loan Documents, any
impairment of the rights, remedies or benefits available to the Administrative
Agent or any Lender under any Loan Document or any impairment of the attachment,
perfection or priority of any lien of the Administrative Agent under this
Reimbursement and Pledge Agreement other than (i) liens arising by operation of
law, so long as the aggregate obligations secured thereby do not exceed
$1,000,000 and (ii) the Custodial Lien and Set-Off Rights.

      In determining whether any individual event has a Material Adverse Effect,
notwithstanding that such event does not of itself have such effect, a Material
Adverse Effect shall be deemed to have occurred if the cumulative effect of such
event and all other then existing events results in a Material Adverse Effect.

      Notice of Exclusive Control. A written notice, in the form attached to the
Control Agreement as Exhibit B, given by the Administrative Agent to the
Custodian upon an Event of Default that the Administrative Agent is exercising
sole and exclusive control of the Securities Account and the Pledged Collateral
credited thereto.

      Obligations. All indebtedness, obligations and liabilities of the Borrower
to any of the Lenders and the Administrative Agent, individually or
collectively, existing on the date of this Reimbursement and Pledge Agreement or
arising thereafter, direct or indirect, absolute or contingent, matured or
unmatured, liquidated or unliquidated, secured or unsecured, arising or incurred
under this Reimbursement and Pledge Agreement or any of the other Loan Documents
or in respect of any Reimbursement Obligations incurred under any Letter of
Credit or other instrument at any time evidencing any thereof and arising by
contract, operation of law or otherwise.

      Participant. See Section 13.4.

      Parent. Montpelier Re Holdings Ltd., parent to the Borrower.
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                                      -10-

      Person. Any individual, corporation, limited liability company
partnership, limited liability partnership, firm, trust, joint venture, joint
stock company, other unincorporated association, business, or other legal
entity, and any Governmental Authority, each whether acting in an individual,
fiduciary or other capacity.

      Pledged Collateral. See Section 4.1.

      Pledged Collateral Certificate. See Section 6.4(e).

      Pounds Sterling or L. The lawful currency of the United Kingdom of Great
Britain and Northern Ireland.

      Pounds Sterling Equivalent. On any particular date, with respect to any
amount denominated in Pounds Sterling, such amount in Pounds Sterling, and with
respect to any amount denominated in Dollars, the amount (as conclusively
ascertained by the Administrative Agent absent manifest error) of Pounds
Sterling which could be purchased by the Administrative Agent (in accordance
with its normal banking practices) in the London foreign currency deposit
markets with such amount of Dollars at the spot rate of exchange prevailing at
or about 11:00 a.m. (London time) on such date.

      Qualified Securities. See Section 6.8.

      Register. See Section 13.3.

      Release Amount. See Section 4.7.

      Reimbursement Obligation. The Borrower's obligation to reimburse the
Administrative Agent and the Lenders on account of any drawing under any Letter
of Credit as provided in Section 2.2.

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

      Required Lenders. As of any date, the Lenders whose aggregate Commitments
constitutes at least fifty-one percent (51%) of the Total Commitment or, if the
Commitments have been terminated, the Lenders whose amount of Letter of Credit
Partipations constitute at least fifty-one percent (51%) of the aggregate Letter
of Credit Participations.

      Replacement Lender. See Section 2.1.5.
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                                      -11-

      Responsible Officer. The president, chief executive officer, chief
financial officer, chief operating officer, treasurer, controller or any
vice-president of the Borrower.

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

      Securities Account. The Borrower's custodial account fund no. 251471
maintained with the Custodian and any replacement or successor account
maintained with the Custodian and subject to the terms of the Control Agreement.

      Subsidiary. Any corporation, association, trust, or other business entity
of which the designated parent shall at any time own directly or indirectly
through a Subsidiary or Subsidiaries at least a majority (by number of votes) of
the outstanding Voting Stock.

      Total Commitment. The sum of the Commitments of the Lenders, as in effect
from time to time.

      Total Tranche A Commitment. The sum of the Tranche A Commitments of the
Tranche A Lenders, as in effect from time to time.

      Total Tranche B Commitment. The sum of the Tranche B Commitments of the
Tranche B Lenders, as in effect from time to time.

      Tranche A Commitment. With respect to each Tranche A Lender, the amount
set forth on Schedule 1 hereto as the amount of such Tranche A Lender's
commitment to participate in the issuance, extension and renewal of Tranche A
Letters of Credit for the account of the Borrower, as the same may be reduced
from time to time; or if such commitment is terminated pursuant to the
provisions hereof, zero.

      Tranche A Commitment Percentage. With respect to each Tranche A Lender,
the percentage set forth on Schedule 1 hereto as such Tranche A Lender's
percentage of the aggregate Tranche A Commitments of all of the Tranche A
Lenders.

      Tranche A Lenders. The Lenders having a Tranche A Commitment, as set forth
on Schedule 1 hereto, along with their successors and assigns.

      Tranche A Letters of Credit. See Section 2.1.1.

      Tranche A Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Tranche A Letters of
Credit, as such aggregate amount may be reduced

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                                      -12-

time to time pursuant to the terms of the Tranche A Letters of Credit.

         Tranche B Commitment. With respect to each Tranche B Lender, the amount
set forth on Schedule 1 hereto as the amount of such Tranche B Lender's
commitment to participate in the issuance, extension and renewal of Tranche B
Letters of Credit for the account of the Borrower, as the same may be reduced
from time to time; or if such commitment is terminated pursuant to the
provisions hereof, zero.

         Tranche B Commitment Percentage. With respect to each Tranche B Lender,
the percentage set forth on Schedule 1 hereto as such Tranche B Lender's
percentage of the aggregate Tranche B Commitments of all of the Tranche B
Lenders.

         Tranche B Lenders. The Lenders having a Tranche B Commitment, as set
forth on Schedule 1 hereto, along with their successors and assigns.

         Tranche B Letters of Credit.  See Section 2.1.2.

         Tranche B Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Tranche B Letters of
Credit, as such aggregate amount may be reduced from time to time pursuant to
the terms of the Tranche B Letters of Credit.

         Treasury Collateral.   See Section 6.8.

         Unpaid Reimbursement Obligation. Any Reimbursement Obligation for which
the Borrower does not reimburse the Administrative Agent and the Lenders on the
date specified in, and in accordance with, Section 2.2.

         Voting Stock. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.

         1.2. RULES OF INTERPRETATION.

                  (a) A reference to any document or agreement shall include
         such document or agreement as amended, modified or
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                                      -13-

         supplemented from time to time in accordance with its terms or the
         terms of this Reimbursement and Pledge Agreement.

                  (b) The singular includes the plural and the plural includes
         the singular.

                  (c) A reference to any law includes any amendment or
         modification to such law.

                  (d) A reference to any Person includes its permitted
         successors and permitted assigns.

                  (e) Accounting terms not otherwise defined herein have the
         meanings assigned to them by GAAP applied on a consistent basis by the
         accounting entity to which they refer.

                  (f) The words "include", "includes" and "including" are not
         limiting.

                  (g) All terms not specifically defined herein or by GAAP,
         which terms are defined in the Uniform Commercial Code as in effect in
         the State of New York, have the meanings assigned to them therein, with
         the term "instrument" being that defined under Article 9 of the Uniform
         Commercial Code.

                  (h) Reference to a particular "Section" refers to that section
         of this Reimbursement and Pledge Agreement unless otherwise indicated.

                  (i) The words "herein", "hereof", "hereunder" and words of
         like import shall refer to this Reimbursement and Pledge Agreement as a
         whole and not to any particular section or subdivision of this
         Reimbursement and Pledge Agreement.

                  (j) Unless otherwise expressly indicated, 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."

                  (k) This Reimbursement and Pledge Agreement may use several
         different limitations, tests or measurements to regulate the same or
         similar matters. All such limitations, tests and measurements are,
         however, cumulative and are to be performed in accordance with the
         terms thereof.
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                                      -14-

                  (l) This Reimbursement and Pledge Agreement is the result of
         negotiation among, and has been reviewed by counsel to, among others,
         the Administrative Agent and the Borrower and is the product of
         discussions and negotiations among all parties. Accordingly, this
         Reimbursement and Pledge Agreement is not intended to be construed
         against the Administrative Agent or any of the Lenders merely on
         account of the Administrative Agent's or any Lender's involvement in
         the preparation of such documents.

                              2. LETTERS OF CREDIT.

         2.1.  LETTER OF CREDIT COMMITMENTS.

                  2.1.1. TRANCHE A LETTERS OF CREDIT. Subject to the terms and
         conditions hereof and the execution and delivery by the Borrower of a
         hard copy or electronically filed letter of credit application on the
         Administrative Agent's customary form (a "Letter of Credit
         Application"), with the Administrative Agent's form as of the Closing
         Date attached hereto as Exhibit C, the Administrative Agent on behalf
         of the Tranche A Lenders and in reliance upon the agreement of the
         Tranche A Lenders set forth in Section 2.1.4 and upon the
         representations and warranties of the Borrower contained herein, agrees
         from time to time during the period from the Closing Date to the
         Commitment Maturity Date, in its individual capacity, to issue, extend
         and renew for the account of the Borrower one or more standby letters
         of credit, each in a minimum face amount of (a) with respect to Tranche
         A Letters of Credit denominated in Pounds Sterling, the Pounds Sterling
         Equivalent of $100,000 and (b) with respect to Tranche A Letters of
         Credit denominated in Dollars, $1,000, to be used in the ordinary
         course of the Borrower's business, denominated in Pounds Sterling or in
         Dollars in such form as may be requested from time to time by the
         Borrower and agreed to by the Administrative Agent (individually, a
         "Tranche A Letter of Credit"); provided, however, that, after giving
         effect to such request, (i) the sum of the Dollar Equivalent of the
         Aggregate Maximum Drawing Amount and the Dollar Equivalent of the
         Unpaid Reimbursement Obligations shall not exceed the Total Commitment
         at any one time, (ii) the sum of the Dollar Equivalent of the Tranche A
         Maximum Drawing Amount and the Dollar Equivalent of the Unpaid
         Reimbursement Obligations consisting of amounts paid under Letters of
         Credit, as set forth in Section 2.2(a)(i), in respect of Tranche A
         Letters of Credit shall not exceed the Total Tranche A Commitment at
         any one time, (iii) no Tranche A Letter of Credit denominated in
         Dollars shall be issued unless the face amount of such Tranche A Letter
         of Credit is higher than
<PAGE>
                                      -15-

         the unused portion of the Tranche B Commitment and (iv) the sum of the
         Dollar Equivalent of the Aggregate Maximum Drawing Amount plus the
         Dollar Equivalent of the Unpaid Reimbursement Obligations consisting of
         amounts paid under Letters of Credit, as set forth in Section
         2.2(a)(i), shall not, at any time, exceed the Collateral Coverage
         Amount. The Borrower and the Lender agree that the Letters of Credit
         listed on Schedule 2.1.1 hereof shall become Tranche A Letters of
         Credit hereunder.

                  2.1.2. TRANCHE B LETTERS OF CREDIT. Subject to the terms and
         conditions hereof and the execution and delivery by the Borrower of a
         Letter of Credit Application, the Administrative Agent on behalf of the
         Tranche B Lenders and in reliance upon the agreement of the Tranche B
         Lenders set forth in Section 2.1.4 and upon the representations and
         warranties of the Borrower contained herein, agrees from time to time
         during the period from the Closing Date to the Commitment Maturity
         Date, in its individual capacity, to issue, extend and renew for the
         account of the Borrower one or more standby letters of credit, each in
         a minimum face amount of $1,000, to be used in the ordinary course of
         the Borrower's business, denominated in Dollars and otherwise in such
         form as may be requested from time to time by the Borrower and agreed
         to by the Administrative Agent (individually, a "Tranche B Letter of
         Credit"); provided, however, that, after giving effect to such request,
         (i) the sum of the Dollar Equivalent of the Aggregate Maximum Drawing
         Amount and the Dollar Equivalent of the Unpaid Reimbursement
         Obligations shall not exceed the Total Commitment at any one time, (ii)
         the sum of the Tranche B Maximum Drawing Amount and all Unpaid
         Reimbursement Obligations consisting of amounts paid under Letters of
         Credit, as set forth in Section 2.2(a)(i), in respect of Tranche B
         Letters of Credit shall not exceed the Total Tranche B Commitment at
         any one time and (iii) the sum of the Dollar Equivalent of the
         Aggregate Maximum Drawing Amount plus all Unpaid Reimbursement
         Obligations consisting of amounts paid under Letters of Credit, as set
         forth in Section 2.2(a)(i), shall not exceed the Collateral Coverage
         Amount.

                  2.1.3. INCREASE TO TOTAL TRANCHE B COMMITMENT. At any time,
         the Borrower may request that the Total Tranche B Commitment and its
         components be increased, provided that, without the prior written
         consent of the Required Lenders, (i) the Total Commitment shall at no
         time exceed $500,000,000 and the Total Tranche B Commitment shall at no
         time exceed $250,000,000 and (ii) each such request shall be in a
         minimum
<PAGE>
                                      -16-

         amount of at least $1,000,000. Such request shall be made in a written
         notice given to the Administrative Agent and the Tranche B Lenders by
         the Borrower not fewer than twenty (20) Business Days prior to the
         proposed effective date of such increase, which notice (a "Commitment
         Increase Notice") shall specify the amount of the proposed increase in
         the Total Tranche B Commitment and the proposed effective date of such
         increase. In the event of such a Commitment Increase Notice, each of
         the Tranche B Lenders shall be given the opportunity to participate in
         the requested increase ratably in proportion that its Tranche B
         Commitments bears to the Total Tranche B Commitment under this
         Reimbursement and Pledge Agreement, respectively. No Lender shall have
         any obligation to increase its Commitment pursuant to a Commitment
         Increase Notice. On or prior to a date that is ten (10) Business Days
         after receipt of the Commitment Increase Notice, each Tranche B Lender
         shall submit to the Administrative Agent a notice indicating the
         maximum amount, if any, by which it is willing to increase its Tranche
         B Commitment in connection with such Commitment Increase Notice (any
         such notice to the Administrative Agent being herein a "Lender Increase
         Notice"). Any Tranche B Lender which does not submit a Lender Increase
         Notice to the Administrative Agent prior to the expiration of such ten
         (10) Business Day period shall be deemed to have denied any increase in
         its Commitment. In the event that the increases of Commitments set
         forth in the Lender Increase Notices exceed the amount requested by the
         Borrower in the Commitment Increase Notice, the Administrative Agent
         shall have the right, in consultation with the Borrower, to allocate
         the amount of increases necessary to meet the Borrower's Commitment
         Increase Notice; provided that, no Lender shall be allocated an amount
         less than its pro rata share of such increase based upon the proportion
         its Tranche B Commitments bear to the Total Tranche B Commitment under
         this Reimbursement and Pledge Agreement. In the event that the Lender
         Increase Notices are less than the amount requested by the Borrower, no
         later than five (5) Business Days prior to the proposed effective date
         the Borrower may notify the Administrative Agent of any Eligible
         Assignee that shall have agreed to become a "Tranche B Lender" party
         hereto (an "Acceding Bank") in connection with the Commitment Increase
         Notice. If the Borrower shall not have arranged any Acceding Bank(s) to
         commit to the shortfall from the Lender Increase Notices, then the
         Borrower shall be deemed to have reduced the amount of its Commitment
         Increase Notice to the aggregate amount set forth in the Lender
         Increase Notices. Based upon the Lender Increase Notices, any
         allocations made in connection therewith and any
<PAGE>
                                      -17-

         notice regarding any Acceding Bank, if applicable, the Administrative
         Agent shall notify the Borrower and the Tranche B Lenders on or before
         the Business Day immediately prior to the proposed effective date of
         the amount of each Bank's and Acceding Bank's Commitment (the
         "Effective Commitment Amount") and the increased amount of the Total
         Tranche B Commitment, which amounts shall be effective on the following
         Business Day subject to the conditions set forth herein. Any increase
         in the Total Tranche B Commitment under this Reimbursement and Pledge
         Agreement shall be subject to the following conditions precedent: (i)
         as of the date of the Commitment Increase Notice and as of the proposed
         effective date of the increase in the Total Commitment under this
         Reimbursement and Pledge Agreement, all representations and warranties
         shall be true and correct in all material respects as though made on
         such date (unless such representation and warranty is made as of a
         specific date, in which case, such representation and warranty shall be
         true and correct as of such date) and no event shall have occurred and
         then be continuing which constitutes a Default or Event of Default
         under this Reimbursement and Pledge Agreement; (ii) the Borrower, the
         Administrative Agent and each Acceding Bank shall have agreed to
         provide a "Commitment" in support of such increase in the Total Tranche
         B Commitment under this Reimbursement and Pledge Agreement, shall have
         executed and delivered an "Instrument of Accession" in a form
         reasonably acceptable to the Administrative Agent; (iii) to the extent
         reasonably required by the Administrative Agent, counsel for the
         Borrower shall have provided to the Administrative Agent a supplemental
         opinion in form and substance reasonably satisfactory to the
         Administrative Agent; (iv) the Acceding Bank(s) shall otherwise have
         executed and delivered such other instruments and documents as the
         Administrative Agent shall have reasonably requested in connection with
         such increase and (v) the Borrower shall have executed and delivered
         all corporate authority documents that the Administrative Agent shall
         have reasonably requested in connection with such increase. Upon
         satisfaction of the conditions precedent to any increase in the Total
         Tranche B Commitment under this Reimbursement and Pledge Agreement, the
         Administrative Agent shall promptly advise the Borrower and each Lender
         of the effective date of such increase. Upon the effective date of any
         increase the Total Tranche B Commitment under this Reimbursement and
         Pledge Agreement that is supported by an Acceding Bank, such Acceding
         Bank shall be a party to this Reimbursement and Pledge Agreement as a
         Tranche B Lender and shall have the rights and obligations of a Tranche
         B hereunder. In addition, on the effective date, the
<PAGE>
                                      -18-

         Administrative Agent shall replace the existing Schedule 1 attached
         hereto with the revised Schedule 1 reflecting such new Total Tranche B
         Commitment and each Lender's Commitment. Nothing contained herein shall
         constitute, or otherwise be deemed to be, a commitment on the part of
         any Lender to increase its Commitment hereunder.

                  2.1.4. TERMS OF LETTERS OF CREDIT. Each Letter of Credit
         issued, extended or renewed hereunder shall, among other things, (a)
         provide for the payment of sight drafts for honor thereunder when
         presented in accordance with the terms thereof and when accompanied by
         the documents described therein, and (b) (i) with respect of Tranche A
         Letters of Credit, issued to Lloyd's, have an expiry date no later than
         the date which is five (5) years from the date of issuance of such
         Letter of Credit and (ii) with respect to all other Tranche A Letters
         of Credit and all Tranche B Letters of Credit, have an expiry date no
         later than the date which is one (1) year from the date of issuance of
         such Letter of Credit. Each Letter of Credit so issued, extended or
         renewed shall be subject to the Uniform Customs and Practice for
         Documentary Credits (1993 Revision), International Chamber of Commerce
         Publication No. 500 or any successor version thereto adopted by the
         Administrative Agent in the ordinary course of its business as a letter
         of credit issuer and in effect at the time of issuance of such Letter
         of Credit (the "Uniform Customs") or the International Standby
         Practices (ISP98), International Chamber of Commerce Publication No.
         590, or any successor code of standby letter of credit practices among
         Administrative Agents adopted by the Administrative Agent in the
         ordinary course of its business as a standby letter of credit issuer
         and in effect at the time of issuance of such Letter of Credit, in each
         case to the extent not inconsistent with New York law. Letters of
         Credit may be issued at any time prior to the Commitment Maturity Date.
         In the event of any conflict between the terms of any Letter of Credit
         Application and this Reimbursement and Pledge Agreement, the terms of
         this Reimbursement and Pledge Agreement shall govern.

                  2.1.5. EXTENSION OF COMMITMENT MATURITY DATE; REPLACEMENT
         LENDER. The Borrower may request an extension of the Commitment
         Maturity Date for one additional three-hundred sixty-four (364) day
         period (the "Extension"). The Borrower must request the Extension in
         writing to the Administrative Agent and the Lenders not less than sixty
         (60) nor more than ninety (90) days prior to the Commitment Maturity
         Date. Each Lender may decide, in its sole discretion, whether to
         participate in the Extension and
<PAGE>
                                      -18-

         shall notify the Administrative Agent and the Borrower in writing of
         its decision within thirty (30) days after receipt of the Borrower's
         request, provided that no Lender shall give formal notification of its
         approval of the Extension more than sixty (60) days prior to the
         Commitment Maturity Date. Any Lender not responding to a request for an
         Extension within thirty (30) days after receipt of the Borrower's
         request shall be deemed to have not consented to the Extension. If a
         Lender does not approve the Extension by such date, the Borrower may,
         up until the fifteenth (15th) day prior to the Commitment Maturity
         Date, (i) request that all or a portion of the remaining Lenders
         acquire and assume all of the non-approving Lender's Commitment as
         provided herein, but none of such Lenders shall be under an obligation
         to do so, (ii) designate a new Lender (a "Replacement Lender") which is
         an Eligible Assignee, and/or (iii) with the approval of the
         Administrative Agent and each of the remaining Lenders, downsize the
         Tranche A Commitment or the Tranche B Commitment, as the case may be,
         and, correspondingly, the Total Commitment, by the amount of the
         non-approving Lender's pro rata share. If any satisfactory Replacement
         Lender shall be obtained, and/or if any one or more of the existing
         Lenders shall agree to acquire and assume all or any portion of the
         non-approving Lender's Commitment, then such non-approving Lender shall
         assign, in accordance with Section 13, all of its Commitment, Letter of
         Credit Participations and other rights and obligations under this
         Reimbursement and Pledge Agreement and all other Loan Documents to such
         Replacement Lender or existing Lenders, as the case may be; provided,
         however, that (A) such assignment shall be without recourse,
         representation or warranty and shall be on terms and conditions
         reasonably satisfactory to such non-approving Lender and such
         Replacement Lender and/or existing Lenders, as the case may be, and (B)
         prior to any such assignment, the Borrower shall have paid to such
         non-approving Lender all amounts properly demanded and unreimbursed. If
         all of the then Lenders have agreed to the Extension on or before the
         fifteenth (15th) day prior to the Commitment Maturity Date, then the
         Extension shall take effect. Upon the commencement of such Extension,
         the Letter of Credit Fee for any existing or new Letters of Credit and
         the Facility Fee may be subject to an annualized increase or decrease,
         as determined by the Administrative Agent in its reasonable discretion.

                  2.1.6. REIMBURSEMENT OBLIGATIONS OF LENDERS. Each Tranche A
         Lender and each Tranche B Lender severally agrees that it shall be
         absolutely liable, without regard to the occurrence of any Default or
         Event of Default or any other condition precedent
<PAGE>
                                      -20-

         whatsoever, to the extent of such Lender's Tranche A Commitment
         Percentage or Tranche B Commitment Percentage, as the case may be, to
         reimburse the Administrative Agent on demand for the amount of each
         draft paid by the Administrative Agent under each Letter of Credit,
         required to be funded by it, to the extent that such amount is not
         reimbursed by the Borrower pursuant to Section 2.2 (such agreement for
         a Lender being called herein the "Letter of Credit Participation" of
         such Lender).

                  2.1.7. PARTICIPATIONS OF LENDERS. Each such payment made by a
         Lender shall be treated as the purchase by such Lender of a
         participating interest in the Borrower's Reimbursement Obligation under
         Section 2.2 in an amount equal to such payment. Each Lender shall share
         in accordance with its participating interest in any interest which
         accrues pursuant to Section 2.2.

         2.2. REIMBURSEMENT OBLIGATION OF THE BORROWER. In order to induce the
Administrative Agent to issue, extend and renew each Letter of Credit and the
Lenders to participate therein, the Borrower hereby agrees:

                  (a) to reimburse or pay to the Administrative Agent, for the
         account of the Administrative Agent or (as the case may be) the
         Lenders, with respect to each Letter of Credit issued, extended or
         renewed by the Administrative Agent hereunder, on each date that any
         draft presented under such Letter of Credit is honored by the
         Administrative Agent, or the Administrative Agent otherwise makes a
         payment with respect thereto, (i) the Dollar Equivalent of the amount
         paid by the Administrative Agent under or with respect to such Letter
         of Credit, and (ii) the amount of any taxes, fees, charges or other
         costs and expenses whatsoever incurred by the Administrative Agent or
         any Lender in connection with any payment made by the Administrative
         Agent or any Lender under, or with respect to, such Letter of Credit,
         provided that, the failure of the Borrower to immediately reimburse the
         Administrative Agent for amounts due pursuant to this Section 2.2(a)
         shall be an Event of Default and upon the occurrence of such Event of
         Default, the Administrative Agent may issue a Notice of Exclusive
         Control and apply all or any portion of the Pledged Collateral towards
         the payment obligations described herein, and

                  (b) that the Administrative Agent may, upon the acceleration
         of the Aggregate Reimbursement Obligations with respect to all Letters
         of Credit in accordance with Section 11, exercise all rights and
         remedies in respect of the Pledged Collateral and any
<PAGE>
                                      -21-

         proceeds thereof, to collect an amount equal to the Dollar Equivalent
         of the then outstanding Reimbursement Obligations.

Each payment contemplated by Section 2.2(a) shall be made to the Administrative
Agent at the Administrative Agent's Office in immediately available funds.
Interest on any and all amounts remaining unpaid by the Borrower under this
Section 2.2 at any time from the date such amounts become due and payable
(whether as stated in this Section 2.2, by acceleration or otherwise) until
payment in full (whether before or after judgment) shall be payable to the
Administrative Agent on demand at the rate specified in Section 3.8. Any Pledged
Collateral or proceeds thereof collected by the Administrative Agent pursuant
Sections 2.2(a) or 2.2(b) may be, at the Administrative Agent's sole
discretion, converted into Pounds Sterling, with any such conversion costs being
considered a collection expense and added to the Obligations. All payments of
Fees, interest and Reimbursement Obligations to the Lenders shall be made in
Dollars even if the underlying Letter of Credit is denominated in Pounds
Sterling.

         2.3. VOLUNTARY COMMITMENT REDUCTIONS. The Borrower shall have the right
at any time and from time to time upon three (3) Business Days prior written
notice to the Administrative Agent to reduce by a minimum amount of $10,000,000
and in multiples of $1,000,000 in excess thereof, or to terminate entirely, the
Tranche A Commitment or the Tranche B Commitment, whereupon the Commitments of
the Tranche A Lenders or the Tranche B Lenders, as the case may be, shall be
reduced pro rata in accordance with their respective Commitment Percentages of
the amount specified in such notice or, terminated as the case may be provided
that (a) the Total Tranche A Commitment may not be reduced to an amount below
the Tranche A Maximum Drawing Amount, (b) the Total Tranche B Commitment may not
be reduced to an amount below the Tranche B Maximum Drawing Amount and (c) the
Total Commitment may not be reduced to an amount below the Aggregate Maximum
Drawing Amount. Promptly after receiving any notice of the Borrower delivered
pursuant to this Section 2.3, the Administrative Agent will notify the Lenders
of the substance thereof. No reduction or termination of the Commitments may be
reinstated.

         2.4. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or
other demand for payment shall be made under any Letter of Credit, the
Administrative Agent shall notify the Borrower of the date and amount of the
draft presented or demand for payment and of the date and time when it expects
to pay such draft or honor such demand for payment. If the Borrower fails to
reimburse the Administrative Agent as provided in Section 2.2 or if the
Administrative Agent is unable to effect such reimbursement through the
application of the Pledged Collateral, on the
<PAGE>
                                      -22-

date that such draft is paid or other payment is made by the Administrative
Agent, the Administrative Agent may at any time thereafter notify the Tranche A
Lenders or the Tranche B Lenders, as the case may be, of the amount of any such
Unpaid Reimbursement Obligation. No later than 3:00 p.m. (Boston time) on the
Business Day next following the receipt of such notice, each Tranche A Lender or
Tranche B Lender, as the case may be, shall make available to the Administrative
Agent, in Dollars, at the Administrative Agent's Office, in immediately
available funds, such Lender's Commitment Percentage of such Unpaid
Reimbursement Obligation, together with an amount equal to the product of (a)
the average, computed for the period referred to in clause (c) below, of the
weighted average interest rate paid by the Administrative Agent for federal
funds acquired by the Administrative Agent during each day included in such
period, times (b) the amount equal to such Lender's Tranche A Commitment
Percentage or Tranche B Commitment Percentage, as the case may be, of such
Unpaid Reimbursement Obligation, times (c) a fraction, the numerator of which is
the number of days that elapse from and including the date the Administrative
Agent paid the draft presented for honor or otherwise made payment to the date
on which such Lender's Tranche A Commitment Percentage or Tranche B Commitment
Percentage, as the case may be, of such Unpaid Reimbursement Obligation shall
become immediately available to the Administrative Agent, and the denominator of
which is 360. The responsibility of the Administrative Agent to the Borrower and
the Lenders shall be only to determine that the documents (including each draft)
delivered under each Letter of Credit in connection with such presentment shall
be in conformity in all material respects with such Letter of Credit.

         2.5. OBLIGATIONS ABSOLUTE. The Borrower's obligations under this
Section 2 shall be absolute and unconditional under any and all circumstances
and irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff, counterclaim or defense to payment
which the Borrower may have or have had against the Administrative Agent, any
Lender or any beneficiary of a Letter of Credit. The Borrower further agrees
with the Administrative Agent and the Lenders that the Administrative Agent and
the other Lenders shall not be responsible for, and the Borrower's Reimbursement
Obligations under Section 2.2 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even if
such documents should in fact prove to be in any or all respects invalid,
fraudulent or forged, or any dispute between or among the Borrower, the
beneficiary of any Letter of Credit or any financing institution or other party
to which any Letter of Credit may be transferred or any claims or defenses
whatsoever of the Borrower against the beneficiary of any Letter
<PAGE>
                                      -23-

of Credit or any such transferee. The Administrative Agent and the Lenders shall
not be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit. The Borrower agrees that any action taken
or omitted by the Administrative Agent or any Lender under or in connection with
each Letter of Credit and the related drafts and documents, if done in good
faith and in the absence of gross negligence and willful misconduct, shall be
binding upon the Borrower and shall not result in any liability on the part of
the Administrative Agent or any Lender to the Borrower.

         2.6. RELIANCE BY ISSUER. To the extent not inconsistent with
Section 2.4, the Administrative Agent shall be entitled to rely, and shall be
fully protected in relying upon, any Letter of Credit, draft, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document 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, 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 this Reimbursement and Pledge
Agreement unless it shall first have received such advice or concurrence of the
Required Lenders as it reasonably deems appropriate or it shall first be
indemnified to its reasonable 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
Reimbursement and Pledge Agreement in accordance with a request of the Required
Lenders, and such request and any action taken or failure to act pursuant
thereto shall be binding upon the Lenders and all future holders of a Letter of
Credit Participation.

         2.7. FACILITY FEE. The Borrower agrees to pay to the Administrative
Agent for the accounts of the Lenders in accordance with their respective
Commitment Percentages a facility fee (the "Facility Fee") calculated at the
rate equal to seven and one-half one-hundredths of one percent (.075%) per annum
of the Total Commitment. The Facility Fee shall be payable quarterly in arrears
on the first day of each calendar quarter for the immediately preceding calendar
quarter (or portion thereof in the event that less than a full calendar quarter
has elapsed) commencing on the first such date following the date hereof, with a
final payment (i) to the Tranche A Lenders on the date on which the Commitments
in respect of the Tranche A Letters of Credit shall terminate and (ii) to the
Tranche B Lenders on the date on which the
<PAGE>
                                      -24-

Commitments in respect of the Tranche B Letters of Credit shall terminate.

         2.8. LETTER OF CREDIT FEE. The Borrower agrees to pay to the
Administrative Agent for the accounts of the Lenders in accordance with their
respective Commitment Percentages a Letter of Credit Fee (the "Letter of Credit
Fee") calculated based on the face amount of each outstanding Letter of Credit
at a rate equal to (a) with respect to the Tranche A Letters of Credit,
twenty-seven and one-half one-hundredths of one percent (.275%) per annum and
(b) with respect to the Tranche B Letters of Credit, twenty-two and one-half
one-hundredths of one percent (.225%) per annum. The Letter of Credit Fee shall
be payable quarterly in advance on the Closing Date, on the date of any issuance
of any Letter of Credit and on the first day of each calendar quarter (or
portion thereof in the event that less than a full calendar quarter has elapsed)
commencing on the first such date after the Closing Date with a final payment
(i) to the Tranche A Lenders on the date on which there are no outstanding
Tranche A Letters of Credit and the Tranche A Commitments have been terminated
and (ii) to the Tranche B Lenders on the date on which there are no outstanding
Tranche B Letters of Credit and the Tranche B Commitment have been terminated.
Upon the granting of an Extension, pursuant to Section 2.1.5, the Letter of
Credit Fee may be subject to an annualized increase or decrease, as determined
by the Administrative Agent in its reasonable discretion. The Borrower shall
also pay to the Administrative Agent, for its own account, the Administrative
Agent's customary or scheduled costs of issuance and usual and customary costs
of, amendment, negotiation or document examination with respect to the Letters
of Credit.

                         3. CERTAIN GENERAL PROVISIONS.

         3.1. FEES PAYABLE PURSUANT TO THE FEE LETTER. The Borrower agrees to
pay to the Administrative Agent and the Arranger the fees set forth in the Fee
Letter.

         3.2.  FUNDS FOR PAYMENTS.

                  3.2.1. PAYMENTS TO ADMINISTRATIVE AGENT. All payments of
         interest, Reimbursement Obligations, Fees and any other amounts due
         hereunder or under any of the other Loan Documents shall be made on the
         due date thereof to the Administrative Agent in Dollars, for the
         respective accounts of the Lenders and the Administrative Agent, at the
         Administrative Agent's Office or at such other place that the
         Administrative Agent may from time to time designate, in each case at
         or about 11:00
<PAGE>
                                      -25-

         a.m. (Boston, Massachusetts, time or other local time at the place of
         payment) and in immediately available funds.

                  3.2.2. NO OFFSET, ETC. All payments by the Borrower hereunder
         and under any of the other Loan Documents shall be made without
         recoupment, setoff or counterclaim and free and clear of and without
         deduction for any taxes, levies, imposts, duties, charges, fees,
         deductions, withholdings, compulsory loans, restrictions or conditions
         of any nature now or hereafter imposed or levied by any jurisdiction or
         any political subdivision thereof or taxing or other authority therein
         unless the Borrower is compelled by law to make such deduction or
         withholding. If any such obligation is imposed upon the Borrower with
         respect to any amount payable by it hereunder or under any of the other
         Loan Documents, the Borrower will pay to the Administrative Agent, for
         the account of the Lenders or the Administrative Agent, as the case may
         be, on the date on which such amount is due and payable hereunder or
         under such other Loan Document, such additional amount in Dollars as
         shall be necessary to enable the Lenders or the Administrative Agent to
         receive the same net amount which the Lenders or the Administrative
         Agent would have received on such due date had no such obligation been
         imposed upon the Borrower. The Borrower will deliver promptly to the
         Administrative Agent certificates or other valid vouchers for all taxes
         or other charges deducted from or paid with respect to payments made by
         the Borrower hereunder or under such other Loan Document.

         3.3. COMPUTATIONS. All computations of interest and of Fees shall be
based on a 360-day year and paid for the actual number of days elapsed.

         3.4. ADDITIONAL COSTS, ETC. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Lender or the Administrative Agent by any central
Administrative Agent or other fiscal, monetary or other authority (whether or
not having the force of law), shall:

                  (a) subject any Lender or the Administrative Agent to any tax,
         levy, impost, duty, charge, fee, deduction or withholding of any
<PAGE>
                                      -26-

         nature with respect to this Reimbursement and Pledge Agreement, the
         other Loan Documents, any Letters of Credit or such Lender's Commitment
         (other than taxes based upon or measured by the income or profits of
         such Lender or the Administrative Agent), or

                  (b) materially change the basis of taxation (except for
         changes in taxes on income or profits) of payments to any Lender of the
         fees or interest in respect of the Letters of Credit or any other
         amounts payable to any Lender or the Administrative Agent under this
         Reimbursement and Pledge Agreement or any of the other Loan Documents,
         or

                  (c) impose or increase or render applicable (other than to the
         extent specifically provided for elsewhere in this Reimbursement and
         Pledge Agreement) any special deposit, reserve, assessment, liquidity,
         capital adequacy or other similar requirements (whether or not having
         the force of law) against assets held by, or deposits in or for the
         account of, or loans by, or letters of credit issued by, or commitments
         of an office of any Lender, or

                  (d) impose on any Lender or the Administrative Agent any other
         conditions or requirements with respect to this Reimbursement and
         Pledge Agreement, the other Loan Documents, any Letters of Credit, such
         Lender's Commitment, or any letters of credit or commitments of which
         such Lender's Commitment forms a part, and the result of any of the
         foregoing is

                           (i) to increase the cost to any Lender of making,
                  funding, issuing, renewing, extending or maintaining such
                  Lender's Commitment or any Letter of Credit, or

                           (ii) to reduce the amount of interest, Reimbursement
                  Obligation or other amount payable to such Lender or the
                  Administrative Agent hereunder on account of such Lender's
                  Commitment or any Letter of Credit, or

                           (iii) to require such Lender or the Administrative
                  Agent to make any payment or to forego any interest or
                  Reimbursement Obligation or other sum payable hereunder, the
                  amount of which payment or foregone interest or Reimbursement
                  Obligation or other sum is calculated by reference to the
                  gross amount of any sum receivable or deemed received by such
                  Lender or the Administrative Agent from the Borrower
                  hereunder,
<PAGE>
                                      -27-

then, and in each such case, the Borrower will, upon demand made by such Lender
or (as the case may be) the Administrative Agent at any time and from time to
time and as often as the occasion therefor may arise, pay to such Lender or the
Administrative Agent such additional amounts as will be sufficient to compensate
such Lender or the Administrative Agent for such additional cost, reduction,
payment or foregone interest or Reimbursement Obligation or other sum, provided
that the Borrower shall not be obligated to pay any additional amounts which
were incurred by any of the Lenders or the Administrative Agent more than
forty-five (45) days prior to the date on which such Lender or the
Administrative Agent, as the case may be, had knowledge of such additional
amounts. The Lender or the Administrative Agent shall present a certificate
setting forth a reasonable calculation of the amount of such increased costs as
per Section 3.6 hereof.

         3.5. CAPITAL ADEQUACY. If after the date hereof any Lender or the
Administrative Agent determines that (a) the adoption of or change in any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) regarding capital requirements for bank holding
companies or any change in the interpretation or application thereof by a
Governmental Authority with appropriate jurisdiction, or (b) compliance by such
Lender or the Administrative Agent or any corporation controlling such Lender or
the Administrative Agent with any law, governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law) of any such
entity regarding capital adequacy, has the effect of reducing the return on such
Lender's or the Administrative Agent's commitment with respect to any
Reimbursement Obligations to a level below that which such Lender or the
Administrative Agent could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or the Administrative
Agent's then existing policies with respect to capital adequacy and assuming
full utilization of such entity's capital) by any amount deemed by such Lender
or (as the case may be) the Administrative Agent to be material, then such
Lender or the Administrative Agent may notify the Borrower of such fact. The
Borrower agrees to pay such Lender or (as the case may be) the Administrative
Agent for the amount of such reduction in the return on capital as and when such
reduction is determined upon presentation by such Lender or (as the case may be)
the Administrative Agent of a certificate in accordance with Section 3.6 hereof;
provided that the Borrower shall not be obligated to pay any additional amounts
which were incurred by any of the Lenders or the Administrative Agent more than
forty-five (45) days prior to the date on which such Lender or the
Administrative Agent, as the case may be, had knowledge of such additional
amounts. Each Lender shall allocate such cost increases among its customers in
good faith and on an equitable basis.
<PAGE>
                                      -28-

         3.6. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to Section 3.4 and 3.5 and a brief explanation of such amounts
which are due, submitted by any Lender or the Administrative Agent to the
Borrower, shall be conclusive, absent manifest error, that such amounts are due
and owing.

         3.7. CHANGE OF LOCATION OF LENDING OFFICE; REPLACEMENT OF LENDER. If
the Borrower shall, as a result of the requirements of Sections 3.4 or 3.5,
be required to pay any Lender the additional costs referred to in such Sections
and the Borrower, in its reasonable discretion, shall deem such additional
amounts to be material, the Borrower shall have the right to (a) request in
writing to such Lender which has certified additional costs to the Borrower,
with copy to the Administrative Agent, that such Lender change the location of
its lending office in order to mitigate such additional costs and (b) if (i)
such Lender does not change the location of its lending office within sixty (60)
days of receipt of such request, or (ii) the Borrower determines, in its
reasonable discretion, after such change in the location of such lending office
that any remaining additional costs are still material, substitute another
Lender who is an Eligible Assignee for such Lender which has certified the
additional costs to the Borrower. Any such substitution shall take place in
accordance with Section 13.2 and shall otherwise be on terms and conditions
reasonably satisfactory to the Administrative Agent, and until such time as such
substitution shall be consummated, the Borrower shall continue to pay such
additional costs. Upon any such substitution, the Borrower shall pay or cause to
be paid to the Lender that is being replaced all amounts properly demanded and
unreimbursed and such Lender will be released from liability hereunder.

         3.8. INTEREST AFTER DEFAULT. Unpaid Reimbursement Obligations and all
other overdue amounts payable hereunder or under any of the other Loan
Documents, including, without limitation, overdue Fees, shall bear interest
compounded monthly and payable on demand at a rate per annum equal to the Base
Rate plus two percent (2%) until such amount shall be paid in full (after as
well as before judgment).

                             4. COLLATERAL SECURITY.

         4.1. SECURITY OF BORROWER. The Obligations shall be secured by a
perfected first priority security interest (subject only to (i) liens arising by
operation of law, so long as the aggregate obligations secured thereby do not
exceed $1,000,000 and (ii) the Custodial Lien and Set-Off Rights) in the
following: (i) the Securities Account and all property held therein or
<PAGE>
                                      -29-

any replacement or successor account and/or any and all substitutions, additions
and accessions thereto, which shall include, but not be limited to, cash,
investment property, securities, security entitlements, securities accounts and
any and all financial assets credited to and held in the Securities Account or
any replacement or successor account, including, without limitation, the
property described on Schedule 4.1 attached hereto and made a part hereof, as
such property may be released or substituted pursuant to the terms hereof; (ii)
the Deposit Account and all of the property from time to time held therein, and
(iii) to the extent not already included in clauses (i) or (ii) above,
dividends, distributions, income, interest and all proceeds of the foregoing,
including, without limitation, the roll-over or reinvested proceeds of the
foregoing, whether now existing or hereafter arising (collectively, the "Pledged
Collateral"). Any delivery or transfer of any of the Pledged Collateral to the
Custodian and credited to the Securities Account or the Deposit Account shall be
deemed a delivery or transfer to the Administrative Agent.

         4.2. DEPOSIT ACCOUNT. The Borrower or any other person on behalf of the
Borrower, including the Custodian, may from time to time deposit cash sums
denominated in Dollars into the Deposit Account. Interest earned on the amounts
held or credited to the Deposit Account shall remain in the Deposit Account. The
Borrower may from time to time request, and the Administrative Agent agrees to,
effect transfers of cash from the Deposit Account to the Securities Account for
the sole purpose of allowing the Borrower to purchase Qualified Securities to be
held in or credited to the Securities Account; provided that (a) any such
transfer request shall involve a minimum amount of $500,000 or integral
multiples of $100,000 in excess thereof, (b) after giving effect to such
transfer request, the Borrower remains in compliance with the covenant contained
in Section 6.8 and (c) no Event of Default has occurred and is continuing
hereunder.

         4.3. SECURITY INTEREST. For and in consideration of the sum of ten
Dollars ($10.00) and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and for and in consideration of the
Administrative Agent's agreement to issue the Letters of Credit and the Lenders'
agreement to purchase Letter of Credit Participations therein, the Borrower
hereby pledges, hypothecates, and impresses the Pledged Collateral with a lien
in favor of the Administrative Agent, on behalf of the Lenders, and grants to
the Administrative Agent a security interest in the Pledged Collateral, in each
case to secure the punctual payment and performance of all the Obligations. The
Borrower covenants and agrees that (i) with respect to the Pledged Collateral
consisting of the Securities Account, the property held therein and any and all
proceeds thereof, the Administrative Agent has control and, from
<PAGE>
                                      -30-

and after the issuance of a Notice of Exclusive Control, which notice shall not
be given unless an Event of Default has occurred and is continuing hereunder,
the Administrative Agent shall have sole and exclusive control, over such
Pledged Collateral and that it shall take all such steps as may be necessary to
cause the Administrative Agent to have sole and exclusive control over such
Pledged Collateral; (ii) with respect to the Pledged Collateral Consisting of
the Deposit Account, the property held therein and any and all proceeds thereof,
except as expressly permitted in Section 4.2 above, the Administrative Agent has
sole and exclusive control over such Pledged Collateral and the Borrower shall
take all such steps as may be necessary to cause the Administrative Agent to
have sole and exclusive control over such Pledged Collateral and the Borrower
shall have no rights to withdraw or direct the transfer of any or all credit
balances at any time in the Deposit Account for so long as any Obligations
remain outstanding under or in respect of the Loan Documents; (iii) it shall not
sell, transfer, assign, or otherwise dispose of any of the Pledged Collateral
without the prior written consent of the Administrative Agent except in
connection with substitutions of Pledged Collateral permitted pursuant to
Section 4.7(b) and provided that, after giving effect to such substitutions, the
Borrower is in compliance with the covenant contained in Section 6.8; (iv) it
shall do or cause to be done all things necessary to preserve and keep in full
force and effect the perfected first priority security interest in the Pledged
Collateral granted to the Administrative Agent hereunder (subject to laws
affecting creditor's rights, generally); (v) it shall not create or permit the
existence of liens or security interests in the Pledged Collateral in favor of
third parties other than (A) liens arising by operation of law, so long as the
aggregate obligations secured thereby do not exceed $1,000,000 and (B) the
Custodial Lien and Set-Off Rights; (vi) it shall not take any action or omit to
take any action that would result in the termination of the Control Agreement
without the prior consent of the Administrative Agent and it shall otherwise
comply in all respects with the provisions of the Control Agreement; and (vii)
with respect to the Deposit Account and the Securities Account, it shall not
give instructions or entitlement orders to the Custodian that would require the
Custodian to advance any margin or other credit to or for the benefit of the
Borrower.

         4.4. BORROWER'S ADDITIONAL OBLIGATIONS. The Borrower agrees that: (1)
any distribution in kind received by the Borrower from any party for or on
account of the Pledged Collateral, including distributions of stock as a
dividend or split of any of the Pledged Collateral, shall be promptly delivered
to the Administrative Agent, for the account of the Lenders, in the form
received with any required endorsement; (2) additional collateral in form and
kind satisfactory to the Administrative Agent will be deposited by the Borrower
with the Administrative Agent,
<PAGE>
                                      -31-

for the account of the Lenders, in accordance with Section 6.8; (3) any note or
other instrument executed and delivered to the Borrower by any party to evidence
any obligation of such party with respect to the Pledged Collateral shall be
promptly delivered with any required endorsement to the Administrative Agent.
All such items shall be held by the Administrative Agent in accordance with the
terms of this Reimbursement and Pledge Agreement.

         4.5. CERTAIN RIGHTS AND DUTIES OF ADMINISTRATIVE AGENT AND LENDERS. The
Borrower acknowledges that the Administrative Agent and the Lenders have no duty
of any type with respect to the Pledged Collateral except for the use of due
care in safekeeping any of the Pledged Collateral actually in the physical
custody of the Administrative Agent or the Lenders; prior to the occurrence of
any Event of Default the Administrative Agent's and the Lenders' rights with
respect to the Pledged Collateral shall be limited to the Administrative Agent's
and the Lenders' rights as secured party and pledgee and the right to perfect
their security interest, preserve, enforce and protect the lien granted
hereunder and their interest in the Pledged Collateral. Prior to the occurrence
and continuance of any Event of Default, the Borrower shall be entitled to vote
any Pledged Collateral constituting securities or capital stock and to give
consents, waivers and ratifications in respect thereof; provided, however, that
no vote shall be cast or consent, waiver or ratification given by the Borrower
if the effect thereof would impair any of the Pledged Collateral or be
inconsistent with or result in any violation of any of the provisions of this
Reimbursement and Pledge Agreement. All such rights of the Borrower to vote and
give consents, waivers and ratifications with respect to the Pledged Collateral
shall cease upon the occurrence and continuance of an Event of Default.

         4.6. POWER OF ATTORNEY, ETC. The Borrower hereby irrevocably
constitutes and appoints the Administrative Agent the true and lawful
attorney-in-fact for and on behalf of the Borrower with full power of
substitution and revocation in its own name or in the name of the Borrower to
make, execute, deliver and record, as the case may be, any and all financing
statements, continuation statements, notices of exclusive control, assignments,
proofs of claim, powers of attorney, leases, discharges or other instruments or
agreements which the Administrative Agent in its sole discretion may deem
necessary or advisable to perfect, preserve, or protect (and, after the
occurrence and during the continuance of an Event of Default, to enforce) the
lien granted hereunder and the Administrative Agent's and the Lenders' interest
in the Pledged Collateral and to carry out the purposes of this Reimbursement
and Pledge Agreement, including but without limiting the generality of the
foregoing, any and all proofs of claim in bankruptcy
<PAGE>
                                      -32-

or other insolvency proceedings of the Borrower, with the right, upon the
occurrence and during the continuance of an Event of Default, to collect and
apply to the Obligations all distributions and dividends made on account of the
Pledged Collateral. The rights and powers conferred on the Administrative Agent
by the Borrower are expressly declared to be coupled with an interest and shall
be irrevocable until all the Obligations are paid and performed in full. A
carbon, photographic, or other reproduction of a security agreement (including
this Reimbursement and Pledge Agreement) or a financing statement is sufficient
as a financing statement to the extent permitted by applicable law.

         4.7. RELEASE OF COLLATERAL. The Administrative Agent shall grant a
release of its lien on the Pledged Collateral:

                  (a) In the event that the Collateral Coverage Amount exceeds
         the Dollar Equivalent of the Aggregate Maximum Drawing Amount plus the
         Dollar Equivalent of all Unpaid Reimbursement Obligations consisting of
         amounts paid under Letters of Credit, as set forth in Section
         2.2(a)(i), (such excess being referred to herein as the "Release
         Amount") then, so long as no Event of Default has occurred and is
         continuing, the Administrative Agent shall, at the request and expense
         of the Borrower, release such portions of the Pledged Collateral
         designated by the Borrower with a fair market value equal to the
         Release Amount (or such smaller amount as may be requested by the
         Borrower); provided that in no event shall the Administrative Agent be
         required to release any Pledged Collateral after the occurrence and
         during the continuance of an Event of Default or in an aggregate amount
         that is less than five hundred thousand dollars ($500,000). In
         connection with any such partial release of the Pledged Collateral, the
         Administrative Agent shall give such consents as may be necessary to
         permit the Custodian to allow the Borrower to withdraw the Release
         Amount from the Securities Account and/or the Deposit Account, as the
         case may be. The Borrower agrees to reimburse the Administrative Agent
         on demand for any and all out-of-pocket costs and expenses incurred by
         the Administrative Agent in connection with any such partial release of
         the Pledged Collateral, including, without limitation, reasonable
         attorney's fees.

                  (b) So long as the Collateral Coverage Amount exceeds the
         Dollar Equivalent of the Aggregate Maximum Drawing Amount plus all
         Unpaid Reimbursement Obligations consisting of amounts paid under
         Letters of Credit, as set forth in Section 2.2(a)(i), and so long as no
         Event of Default has occurred and is continuing, the
<PAGE>
                                      -33-

         Borrower may make substitutions of equal or greater value for the
         Pledged Collateral; provided that such Pledged Collateral shall at all
         times consist of cash and Qualified Securities. In the event that any
         amounts are paid or due to be paid in respect of the Pledged Collateral
         (whether at scheduled maturity or otherwise), the Borrower may give
         instructions to roll-over or reinvest such amounts in Qualified
         Securities, all of which shall remain Pledged Collateral hereunder.

                  (c) In the event that (i) any and all Letters of Credit are
         fully drawn or expire or are returned to the Administrative Agent for
         cancellation, and (ii) all Reimbursement Obligations with respect to
         any drawings of Letters of Credit have been fully satisfied pursuant to
         the provisions of this Reimbursement and Pledge Agreement and the other
         Loan Documents, and (iii) no other Obligations, whether contingent or
         otherwise, are then outstanding, the Administrative Agent agrees that
         (A) it shall, after request by Borrower and at Borrower's sole cost and
         expense, release the Pledged Collateral from the security interest and
         lien created by this Reimbursement and Pledge Agreement and shall
         execute, or cause to be executed, such instruments of release and
         discharge as may be reasonably requested by the Borrower and (B) the
         Borrower may thereafter withdraw from the Deposit Account any amounts
         constituting the balance in the Deposit Account.

                       5. REPRESENTATIONS AND WARRANTIES.

         The Borrower represents and warrants to the Lenders and the
Administrative Agent as follows:

         5.1.  CORPORATE AUTHORITY.

                  5.1.1. INCORPORATION; GOOD STANDING. The Borrower (a) is a
         corporation (or similar business entity) duly organized, validly
         existing and in good standing under the laws of its jurisdiction of
         incorporation or formation, (b) has all requisite corporate (or the
         equivalent company) power to own its property and conduct its business
         as now conducted and as presently contemplated, and (c) is in good
         standing as a foreign corporation (or similar business entity) and is
         duly authorized to do business in each jurisdiction where such
         qualification is necessary except where a failure to be so qualified
         would not have a Material Adverse Effect.

                  5.1.2. AUTHORIZATION. The execution, delivery and performance
         of this Reimbursement and Pledge Agreement and the other Loan Documents
         to which the Borrower is, or is to become, a
<PAGE>
                                      -34-

         party and the transactions contemplated hereby and thereby (a) are
         within the corporate (or the equivalent company) authority of the
         Borrower, (b) have been duly authorized by all necessary corporate (or
         the equivalent company) proceedings, (c) do not and will not conflict
         with or result in any breach or contravention of any provision of law,
         statute, rule or regulation to which the Borrower is subject or any
         judgment, order, writ, injunction, license or permit applicable to the
         Borrower and (d) do not conflict with any provision of the Governing
         Documents of, or any agreement or other instrument binding upon, the
         Borrower.

                  5.1.3. ENFORCEABILITY. The execution and delivery of this
         Reimbursement and Pledge Agreement and the other Loan Documents to
         which the Borrower is or is to become a party will result in valid and
         legally binding obligations of the Borrower enforceable against it in
         accordance with the respective terms and provisions hereof and thereof,
         except as enforceability is limited by bankruptcy, insolvency,
         reorganization, moratorium or other laws relating to or affecting
         generally the enforcement of creditors' rights or by the application of
         equitable principles relating to enforceability (regardless of whether
         considered in a proceeding in equity or at law) including, without
         limitation, (i) the possible unavailability of specific performance
         injunctive relief or any equitable remedy and (ii) concepts of
         materiality, reasonableness, good faith and fair dealings; provided
         that the Borrower assumes for the purposes of this Section 5.1.3 that
         this Reimbursement and Pledge Agreement and the other Loan Documents
         have been validly executed and delivered by each of the parties thereto
         other than the Borrower.

         5.2. GOVERNMENTAL APPROVALS. The execution, delivery and performance by
         the Borrower of this Reimbursement and Pledge Agreement and the other
         Loan Documents to which the Borrower is or is to become a party and the
         transactions contemplated hereby and thereby do not require the
         approval or consent of, or filing with, any governmental agency or
         authority other than those already obtained.

         5.3.  FINANCIAL STATEMENTS.

                  5.3.1. FISCAL YEAR. The Borrower and each of its Subsidiaries
         has a fiscal (or financial) year which is the twelve months ending on
         December 31 of each calendar year.

<PAGE>
                                      -35-

            5.3.2. FINANCIAL STATEMENTS. There are no Contingent Liabilities (as
      defined on Schedule 8 hereto) of the Borrower as of such date involving
      material amounts, known to the officers of the Borrower, which were not
      disclosed in such balance sheet and the notes related thereto. There has
      been furnished to each of the Lenders a consolidated balance sheet of the
      Parent and its Subsidiaries as at the Balance Sheet Date, and a
      consolidated statement of income of the Parent and its Subsidiaries for
      the fiscal year then ended, certified by a Responsible Officer. Such
      balance sheet and statement of income have been prepared in accordance
      with GAAP and fairly present the financial condition of the Parent as at
      the close of business on the date thereof and the results of operations
      for the fiscal year then ended. There are no Contingent Liabilities (as
      defined on Schedule 8 hereto) of the Parent or any of its Subsidiaries as
      of such date involving material amounts, known to the officers of the
      Parent, which were not disclosed in such balance sheet and the notes
      related thereto. In the event that GAAP requires that the financial
      statements be presented on a combined basis, the Borrower shall have
      furnished a combined balance sheet and a combined statement of income for
      the Parent and its Subsidiaries.

      5.4. NO MATERIAL ADVERSE CHANGES, ETC. Since the Balance Sheet Date there
has been no event or occurrence which has had a Material Adverse Effect.

      5.5. FRANCHISES, PATENTS, COPYRIGHTS, ETC. The Borrower possesses all
franchises, patents, copyrights, trademarks, trade names, licenses and permits,
and rights in respect of the foregoing, adequate for the conduct of its business
substantially as now conducted without known conflict with any rights of others.

      5.6. LITIGATION. Except as set forth in Schedule 5.6 hereto, there are no
actions, suits, proceedings or investigations of any kind pending or threatened
against the Borrower or any of its Subsidiaries before any Governmental
Authority, (a) that, if adversely determined, might, either in any case or in
the aggregate, (i) have a Material Adverse Effect or (ii) materially impair the
right of the Borrower and its Subsidiaries to carry on business substantially as
now conducted by them, or result in any substantial liability not adequately
covered by insurance, or for which adequate reserves are not maintained on the
consolidated balance sheet of the Parent and its Subsidiaries or, in the event
that GAAP requires the financial statements to be presented on a combined basis,
the combined balance sheet or (b) which, question the validity of this
Reimbursement and Pledge Agreement.
<PAGE>
                                      -36-

      5.7. NO MATERIALLY ADVERSE CONTRACTS, ETC. Neither the Borrower nor or any
of its Subsidiaries is subject to any Governing Document or other legal
restriction, or any judgment, decree, order, law, statute, rule or regulation
that has or, to the knowledge of the Responsible Officers, is expected in the
future to have a Material Adverse Effect. Neither the Borrower nor any of its
Subsidiaries is a party to any contract or agreement that has or is expected, in
the judgment of the Borrower's officers, to have any Material Adverse Effect.

      5.8. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. Neither the Borrower
nor any of its Subsidiaries is in violation of any provision of its Governing
Documents, or any agreement or instrument to which it may be subject or by which
it or any of its properties may be bound or any decree, order, judgment,
statute, license, rule or regulation, in any of the foregoing cases in a manner
that could result in the imposition of substantial penalties or have a Material
Adverse Effect.

      5.9. TAX STATUS. The Borrower and its Subsidiaries (a) have made or filed
all federal, state and foreign income and all other tax returns, reports and
declarations required by any jurisdiction to which any of them is subject,
except those which the failure to file would not have a Material Adverse Effect,
(b) have paid all taxes and other governmental assessments and charges shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith and by appropriate proceedings or those which the
failure to pay would not have a Material Adverse Effect and (c) have set aside
on their books provisions reasonably adequate for the payment of all taxes for
periods subsequent to the periods to which such returns, reports or declarations
apply. There are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and none of the Responsible Officers of
the Borrower know of any basis for any such claim.

      5.10. NO EVENT OF DEFAULT. No Default or Event of Default has occurred and
is continuing.

      5.11. INVESTMENT COMPANY ACTS. Neither the Borrower nor any of its
Subsidiaries is an "investment company", or an "affiliated company" or a
"principal underwriter" of an "investment company", as such terms are defined in
the Investment Company Act of 1940, as amended.

      5.12. ABSENCE OF FINANCING STATEMENTS, ETC. Except as set forth on
Schedule 5.12, there is no financing statement, security agreement, chattel
mortgage, real estate mortgage or other document filed or recorded with any
filing records, registry or other public office,
<PAGE>
                                      -37-

that purports to cover, affect or give notice of any present or possible future
lien on any of the Pledged Collateral.

      5.13. PERFECTION OF SECURITY INTEREST. All filings, assignments, pledges
and deposits of documents or instruments have been made and all other actions
have been taken that are necessary or advisable, under applicable law, to
establish and perfect the Administrative Agent's security interest in the
Pledged Collateral. The Administrative Agent and the Lenders acknowledge and
agree that the Pledged Collateral is subject to liens and set-off rights in
favor of the Custodian pursuant to Article V, Section 10 of the Control
Agreement (the "Custodial Lien and Set-off Rights"). The Pledged Collateral and
the Administrative Agent's rights with respect to the Pledged Collateral are not
subject to any setoff, claims, withholdings or other defenses other than the
Custodial Lien and Set-off Rights. The Borrower is the owner of the Pledged
Collateral free from any lien, encumbrance or security interest, other than (i)
liens arising by operation of law, so long as the aggregate obligations secured
thereby do not exceed $1,000,000, (ii) the Custodial Lien and Set-Off Rights and
(iii) those granted hereby.

      5.14. USE OF PROCEEDS.

            5.14.1. GENERAL. The Borrower will obtain Letters of Credit to be
      issued in the ordinary course of the Borrower's business.

            5.14.2. REGULATIONS U AND X. No portion of any Letter of Credit is
      to be obtained, for the purpose of purchasing or carrying any "margin
      security" or "margin stock" as such terms are used in Regulations U and X
      of the Board of Governors of the Federal Reserve System, 12 C.F.R. Parts
      221 and 224.

            5.14.3. INELIGIBLE SECURITIES. No portion of any Letter of Credit is
      to be obtained, for the purpose of knowingly purchasing, or providing
      credit support for the purchase of, during the underwriting or placement
      period or within thirty (30) days thereafter, any Ineligible Securities
      underwritten or privately placed by a Financial Affiliate.

      5.15. SUBSIDIARIES, ETC. Montpelier Marketing Services (UK) Limited and
Montpelier Holdings (Barbados) SRL are the only Subsidiaries of the Borrower.
Except as set forth on Schedule 5.15 hereto, neither the Borrower nor any
Subsidiary of the Borrower is engaged in any joint venture or partnership with
any other Person. The jurisdiction of the registered office of each Subsidiary
of the Borrower is listed on Schedule 5.15 hereto.
<PAGE>
                                      -38-

      5.16. DISCLOSURE. None of this Reimbursement and Pledge Agreement or any
of the other Loan Documents contains any untrue statement of a material fact or
omits to state a material fact known to the Borrower necessary in order to make
the statements herein or therein not misleading. There is no fact known to the
Borrower or any of its Subsidiaries which has a Material Adverse Effect, or
which is reasonably likely in the future to have a Material Adverse Effect,
exclusive of effects resulting from changes in general economic conditions,
legal standards or regulatory conditions.

      5.17. FOREIGN ASSETS CONTROL REGULATIONS, ETC. None of the requesting or
issuance, extension or renewal of any Letters of Credit or the use of the
proceeds of any thereof will violate the Trading With the Enemy Act (50 U.S.C.
Section 1 et seq., as amended) (the "Trading With the Enemy Act") or any of the
foreign assets control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) (the "Foreign Assets Control
Regulations") or any enabling legislation or executive order relating thereto
(which for the avoidance of doubt shall include, but shall not be limited to (a)
Executive Order 13224 of September 21, 2001 Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism
(66 Fed. Reg. 49079 (2001)) (the "Executive Order") and (b) the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (Public Law 107-56)). Furthermore, neither the
Borrower nor any of its Subsidiaries (a) is or will become a "blocked person" as
described in the Executive Order, the Trading With the Enemy Act or the Foreign
Assets Control Regulations or (b) engages or will engage in any dealings or
transactions, or be otherwise associated, with any such "blocked person".

                            6. AFFIRMATIVE COVENANTS.

      The Borrower covenants and agrees that, so long as any Unpaid
Reimbursement Obligation or Letter of Credit is outstanding or the
Administrative Agent has any obligation to issue, extend or renew any Letters of
Credit:

      6.1. PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or cause
to be paid the interest on all Reimbursement Obligations, Fees and all other
amounts provided for in this Reimbursement and Pledge Agreement and the other
Loan Documents to which the Borrower or any of its Subsidiaries is a party, all
in accordance with the terms of this Reimbursement and Pledge Agreement and such
other Loan Documents.
<PAGE>
                                      -39-

      6.2. MAINTENANCE OF OFFICE. The Borrower will maintain its registered
office at 8 Par-La-Ville Road, Hamilton, HM 08, Bermuda, or at such other place
as the Borrower shall designate upon written notice to the Administrative Agent,
where notices, presentations and demands to or upon the Borrower in respect of
the Loan Documents to which the Borrower is a party may be given or made.

      6.3. RECORDS AND ACCOUNTS. The Borrower will (a) keep, and cause each of
its Subsidiaries to keep, true and accurate records and books of account in
which full, true and correct entries will be made in accordance with GAAP, (b)
maintain adequate accounts and reserves for all taxes (including income taxes),
depreciation, depletion, obsolescence and amortization of its properties and the
properties of its Subsidiaries, contingencies, and other reserves, and (c) at
all times engage PricewaterhouseCoopers or other independent certified public
accountants satisfactory to the Administrative Agent as the independent
certified public accountants of the Borrower and its Subsidiaries and will not
permit more than thirty (30) days to elapse between the cessation of such firm's
(or any successor firm's) engagement as the independent certified public
accountants of the Borrower and its Subsidiaries and the appointment in such
capacity of a successor firm as shall be satisfactory to the Administrative
Agent.

      6.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrower will
deliver to each of the Lenders:

            (a) as soon as practicable, but in any event not later than ninety
      (90) days after the end of each fiscal year of the Parent, the
      consolidated balance sheet of the Parent and its Subsidiaries and the
      consolidating balance sheet of the Parent and its Subsidiaries, each as at
      the end of such year, and the related consolidated statement of income and
      consolidated statement of cash flow and consolidating statement of income
      and consolidating statement of cash flow for such year, each setting forth
      in comparative form the figures for the previous fiscal year and all such
      consolidated and consolidating statements to be in reasonable detail,
      prepared in accordance with GAAP, and certified, without qualification and
      without an expression of uncertainty as to the ability of the Parent, the
      Borrower or any of their Subsidiaries to continue as going concerns, by
      PricewaterhouseCoopers or any other independent certified public
      accountant engaged pursuant to Section 6.3(c);

            (b) as soon as practicable, but in any event not later than
      forty-five (45) days after the end of each of the fiscal quarters of the
      Parent, copies of the unaudited consolidated balance sheet of the
<PAGE>
                                      -40-

      Parent and its Subsidiaries and the unaudited consolidating balance sheet
      of the Parent and its Subsidiaries, each as at the end of such quarter,
      and the related consolidated statement of income and consolidated
      statement of cash flow and consolidating statement of income and
      consolidating statement of cash flow for the portion of the Parent's
      fiscal year then elapsed, all in reasonable detail and prepared in
      accordance with GAAP, together with a certification by the principal
      financial or accounting officer of the Parent that the information
      contained in such financial statements fairly presents the financial
      position of the Parent and its Subsidiaries on the date thereof (subject
      to year-end adjustments);

            (c) Within thirty (30) days of receipt of any audit committee report
      prepared by the Borrower's accountants, if there are any reportable events
      resulting in any discussion in the sections of such report entitled
      "Errors or Irregularities", "Illegal Acts" and "Misstatements Due to
      Fraud", the Borrower will provide copies of such sections to the
      Administrative Agent;

            (d) simultaneously with the delivery of the financial statements
      referred to in subsections (a) and (b) above, a statement certified by the
      principal financial or accounting officer of the Parent in substantially
      the form of Exhibit D hereto (a "Compliance Certificate") and setting
      forth in reasonable detail computations evidencing compliance with the
      covenants contained in Section 8 and (if applicable) reconciliations to
      reflect changes in GAAP since the Balance Sheet Date;

            (e) no later than the tenth (10th) Business Day of each month, or,
      following the occurrence and during the continuance of an Event of
      Default, at such other times as the Administrative Agent may request, a
      certificate (the "Pledged Collateral Certificate") substantially in the
      form of Exhibit E attached hereto, signed by an officer of the Borrower,
      certifying compliance with the collateral coverage requirement set forth
      in Section 6.8 and demonstrating, in detail satisfactory to the
      Administrative Agent, the fair market value (as valued by Bloomberg or, if
      Bloomberg is not available, another quotation service reasonably
      acceptable to the Administrative Agent) of the Qualified Securities and
      the amount of cash on deposit in the Deposit Account as of the last
      Business Day of the immediately preceding month;

            (f) contemporaneously with the filing or mailing thereof, copies of
      all material of a financial nature filed with the Securities
<PAGE>
                                      -41-

      and Exchange Commission or sent to the stockholders of the Borrower;

            (g) from time to time such other financial data and information as
      the Administrative Agent or any Lender may reasonably request;

      In the event that GAAP requires the financial statements required under
      clauses (a) and (b) above to be presented on a combined basis, the
      Borrower shall deliver such combined and combining statements in lieu of
      the required consolidated and consolidating financial statements.

      6.5. NOTICES.

            6.5.1. DEFAULTS. As soon as practicable after Responsible Officer of
      the Borrower knows of the existence of any Default or Event of Default,
      the Borrower will notify the Administrative Agent, in writing, of the
      occurrence of such Default or Event of Default, together with a reasonably
      detailed description thereof, and the actions the Borrower proposes to
      take with respect thereto.

            6.5.2. NOTIFICATION OF CLAIM AGAINST PLEDGED COLLATERAL. The
      Borrower will, immediately upon becoming aware thereof, notify the
      Administrative Agent, in writing, of any setoff, claims, withholdings or
      other defenses to which any of the Pledged Collateral, or the
      Administrative Agent's rights with respect to the Pledged Collateral, are
      subject other than with respect to the Custodial Lien and Set-off Rights,
      provided that the Borrower will notify the Administrative Agent hereunder
      of any set-off exercised by the Custodian pursuant to the Custodial Lien
      and Set-off Rights.

            6.5.3. NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will, and
      will cause each of its Subsidiaries to, give notice to the Administrative
      Agent and each of the Lenders in writing within thirty (30) days of
      becoming aware of any litigation or proceedings threatened in writing or
      any pending litigation and proceedings affecting the Borrower or any of
      its Subsidiaries or to which the Borrower or any of its Subsidiaries is or
      becomes a party involving an uninsured claim against the Borrower or any
      of its Subsidiaries that could reasonably be expected to have a Material
      Adverse Effect on the Borrower or any of its Subsidiaries and stating the
      nature and status of such litigation or proceedings. The Borrower will
      give notice to the Administrative Agent, in writing, in form and detail
      satisfactory to the Administrative Agent, within ten (10) days
<PAGE>
                                      -42-

      of any final judgment not covered by insurance, against the Borrower or
      any of its Subsidiaries in an amount in excess of $5,000,000.

      6.6. LEGAL EXISTENCE; MAINTENANCE OF PROPERTIES. The Borrower will do or
cause to be done all things necessary to preserve and keep in full force and
effect its legal existence, rights and franchises and those of its Subsidiaries.
It (i) will cause all of its properties and those of its Subsidiaries used or
useful in the conduct of its business or the business of its Subsidiaries to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment, (ii) will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in the
judgment of the Borrower may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times,
and (iii) will continue to engage primarily in the businesses now conducted by
them and in related businesses; provided that nothing in this Section 6.6 shall
prevent the Borrower from discontinuing the operation of any Subsidiary or the
operation and maintenance of any of its properties or any of those of its
Subsidiaries if such discontinuance is, in the judgment of the Borrower,
desirable in the conduct of its or their business and that do not in the
aggregate have a Material Adverse Effect.

      6.7. TAXES. The Borrower will, and will cause each of its Subsidiaries to,
duly pay and discharge, or cause to be paid and discharged, before the same
shall become overdue, all taxes, assessments and other governmental charges
imposed upon it and its real estate, sales and activities, or any part thereof,
or upon the income or profits therefrom, other than where failure to pay such
taxes would not result in a Material Adverse Effect; provided that any such tax,
assessment, charge, levy or claim need not be paid if the validity or amount
thereof shall currently be contested in good faith by appropriate proceedings
and if the Borrower or such Subsidiary shall have set aside on its books
adequate reserves with respect thereto; and provided further that the Borrower
and each Subsidiary will pay all such taxes, assessments, charges, levies or
claims forthwith upon the commencement of proceedings to foreclose any lien that
may have attached to the Pledged Collateral as security therefor.

      6.8. COLLATERAL COVERAGE. The Borrower hereby covenants and agrees that
the Collateral Coverage Amount (as hereinafter defined) must at all times be
equal to or greater than the Dollar Equivalent of the Aggregate Maximum Drawing
Amount plus the Dollar Equivalent of all Unpaid Reimbursement Obligations
consisting of amounts paid under Letters of Credit, as set forth in Section
2.2(a)(i). As used herein, the
<PAGE>
                                      -43-

"Collateral Coverage Amount" means the sum of (a) the fair market value (as
calculated by the Administrative Agent in its reasonable discretion) of the
Pledged Collateral consisting of cash multiplied by 1.0 plus (b) the fair market
value (as calculated by the Administrative Agent by reference to Bloomberg or,
if Bloomberg is not available, another quotation service reasonably acceptable
to the Administrative Agent) of the Pledged Collateral consisting of Freely
Transferable debt obligations issued by the U.S. Treasury Department or backed
by the full faith and credit of the United States of America (the "Treasury
Collateral") multiplied by .90 plus (c) the fair market value (as calculated by
the Administrative Agent by reference to Bloomberg or, if Bloomberg is not
available, another quotation service reasonably acceptable to the Administrative
Agent) of the Pledged Collateral consisting of Freely Transferable debt
obligations issued by U.S. Federal Agencies other than the U.S. Treasury
Department (the "Federal Agency Collateral") multiplied by .80. The Federal
Agency Collateral together with the Treasury Collateral, shall be referred to
collectively as the "Qualified Securities". If the Borrower's A.M. Best Rating
falls below the rating of "A"-, (x) the multiplier "1.0" contained in clause (a)
above shall be decreased to ".90", (y) the multiplier ".90" contained in clause
(b) above shall be decreased to ".80" and (z) the multiplier ".80" contained in
clause (c) above shall be decreased to .70. If at any time the Collateral
Coverage Amount is less than the Dollar Equivalent of the Aggregate Maximum
Drawing Amount plus the Dollar Equivalent of all Unpaid Reimbursement
Obligations consisting of amounts paid under Letters of Credit, as set forth in
Section 2.2(a)(i), then the Borrower shall promptly provide to the
Administrative Agent and pledge hereunder such additional cash or Qualified
Securities as may be necessary to satisfy the foregoing Collateral Coverage
Amount. Failure to do so within two (2) Business Days shall constitute an
immediate and automatic Event of Default under the terms and conditions of this
Reimbursement and Pledge Agreement. Notwithstanding the monthly reporting
obligations set forth in Section 6.4(e), the covenant contained herein shall be
tested at all times.

      6.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.

            6.9.1. GENERAL. The Borrower shall permit the Administrative Agent,
      upon reasonable prior notice and at reasonable times to visit and inspect
      any of the properties of the Borrower or any of its Subsidiaries, to
      examine the books of account of the Borrower and its Subsidiaries (and to
      make copies thereof and extracts therefrom), and to discuss the affairs,
      finances and accounts of the Borrower and its Subsidiaries with, and to be
      advised as to the same by, its and their officers. Following the
      occurrence and during the continuance of an Event of Default, any
<PAGE>
                                      -44-

      of the Lenders and any of the Administrative Agent's or any of the
      Lenders' employees, agents, consultants or attorneys, may accompany the
      Administrative Agent on such visits, inspections or discussions.

            6.9.2. COMMUNICATIONS WITH ACCOUNTANTS. The Borrower authorizes the
      Administrative Agent to communicate directly with the Borrower's
      independent certified public accountants and authorizes such accountants
      to disclose to the Administrative Agent and the Lenders any and all
      financial statements and other supporting financial documents and
      schedules with respect to the business, financial condition and other
      affairs of the Borrower or any of its Subsidiaries. Following the
      occurrence and during the continuance of an Event of Default, any of the
      Lenders and any of the Administrative Agent's or any of the Lenders'
      employees, agents, consultants or attorneys, may participate in such
      communications.

            At the request of the Administrative Agent, the Borrower shall
      deliver a letter addressed to such accountants instructing them to comply
      with the provisions of this Section 6.9.2.

      6.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. The Borrower
will, and will cause each of its Subsidiaries to, comply with (a) the applicable
laws and regulations wherever its business is conducted, including all
environmental laws, except where failure to do so would not have a Material
Adverse Effect, (b) the provisions of its Governing Documents, (c) all
agreements and instruments by which it or any of its properties may be bound,
except where failure to do so would not have a Material Adverse Effect, and (d)
all applicable decrees, orders, and judgments, except where failure to do so
would not have a Material Adverse Effect. If any authorization, consent,
approval, permit or license from any officer, agency or instrumentality of any
competent government shall become necessary or required in order that the
Borrower fulfill any of its obligations hereunder or any of the other Loan
Documents to which the Borrower is a party, the Borrower will immediately take
or cause to be taken all reasonable steps within the power of the Borrower to
obtain such authorization, consent, approval, permit or license and furnish the
Administrative Agent and the Lenders with evidence thereof.

      6.11. USE OF PROCEEDS. The Borrower will obtain Letters of Credit solely
for the purposes set forth in Section 2.1.1 and 2.1.2.

      6.12. FURTHER ASSURANCES. The Borrower will, and will cause each of its
Subsidiaries to, cooperate with the Lenders and the
<PAGE>
                                      -45-

Administrative Agent and execute such further instruments and documents as the
Lenders or the Administrative Agent shall reasonably request to carry out to
their satisfaction the transactions contemplated by this Reimbursement and
Pledge Agreement and the other Loan Documents.

                         7. CERTAIN NEGATIVE COVENANTS.

      The Borrower covenants and agrees that, so long as any Unpaid
Reimbursement Obligation or Letter of Credit is outstanding or the
Administrative Agent has any obligations to issue, extend or renew any Letters
of Credit:

      7.1. BUSINESS ACTIVITIES. The Borrower will not engage directly or
indirectly (whether through Subsidiaries or otherwise), as its primary business,
in any type of business other than the businesses conducted by them on the
Closing Date and in related businesses.

      7.2. FISCAL YEAR. The Borrower will not, and will not permit any of it
Subsidiaries to, change the date of the end of its fiscal or financial year from
that set forth in Section 5.3.1.

      7.3. TRANSACTIONS WITH AFFILIATES. The Borrower will not, and will not
permit any of its Subsidiaries to, engage in any transaction with any Affiliate
(other than for services as employees, officers and directors), including any
contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or from,
or otherwise requiring payments to or from any such Affiliate or, to the
knowledge of the Borrower, any corporation, partnership, trust or other entity
in which any such Affiliate has a substantial interest or is an officer,
director, trustee or partner, on terms more favorable to such Person than would
have been obtainable on an arm's-length basis in the ordinary course of business
provided that transactions between the Parent and any wholly-owned Subsidiary of
the Parent or between any wholly-owned Subsidiaries of the Parent shall be
excluded from the restrictions set forth in this Section 7.3.

      7.4. DISPOSITION OF ASSETS. The Borrower shall not, and not permit any of
its Insurance Subsidiaries to, sell, transfer, convey or lease all or any
substantial part of its assets or sell or assign with or without recourse any
receivables, other than any sale, transfer, conveyance or lease in the ordinary
course of business, except for (x) any sale, transfer, lease or disposition of
an asset by or to a Subsidiary and (y) any such sale, transfer, conveyance,
lease or assignment of any wholly owned Subsidiary to the Borrower or any other
wholly owned Subsidiary,
<PAGE>
                                      -46-

provided in each case no Default or Event of Default has occurred and is
continuing or would result therefrom.

                             8. FINANCIAL COVENANTS.

      The Borrower covenants and agrees that, so long as any Unpaid
Reimbursement Obligation or Letter of Credit is outstanding or the
Administrative Agent has any obligation to issue, extend or renew any Letters of
Credit, it shall comply with the financial covenants set forth on Schedule 8
hereto.

                             9. CLOSING CONDITIONS.

      The obligations of the Administrative Agent to issue any initial Letters
of Credit shall be subject to the satisfaction of the following conditions
precedent on or prior to June 20, 2003:

      9.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full force
and effect and shall be in form and substance satisfactory to the Administrative
Agent and the Administrative Agent shall have received a fully executed copy of
each such document.

      9.2. CERTIFIED COPIES OF GOVERNING DOCUMENTS. The Administrative Agent
shall have received from the Borrower a copy, certified by a duly authorized
officer of the Borrower to be true and complete on the Closing Date, of each of
its Governing Documents as in effect on such date of certification.

      9.3. CORPORATE OR OTHER ACTION. All corporate (or other) action necessary
for the valid execution, delivery and performance by the Borrower of this
Reimbursement and Pledge Agreement and the other Loan Documents to which it is
or is to become a party shall have been duly and effectively taken, and evidence
thereof satisfactory to the Administrative Agent shall have been provided to the
Administrative Agent.

      9.4. INCUMBENCY CERTIFICATE. The Administrative Agent shall have received
from the Borrower an incumbency certificate, dated as of the Closing Date,
signed by a duly authorized officer of the Borrower and giving the name and
bearing a specimen signature of each individual who shall be authorized: (a) to
sign, in the name and on behalf of the Borrower, each of the Loan Documents to
which the Borrower is or is to become a party; (b), to apply for Letters of
Credit; and (c) to give notices and to take other action on its behalf under the
Loan Documents.
<PAGE>
                                      -47-

      9.5. VALIDITY OF LIENS. This Reimbursement and Pledge Agreement and the
other Loan Documents shall be effective to create in favor of the Administrative
Agent a legal, valid and enforceable first security interest in and lien upon
the Pledged Collateral (subject to (i) liens arising by operation of law, so
long as the aggregate obligations secured thereby do not exceed $1,000,000 and
(ii) the Custodial Lien and Set-Off Rights). All filings, recordings, deliveries
of instruments and other actions necessary or desirable in the opinion of the
Administrative Agent to protect and preserve such security interests shall have
been duly effected. The Administrative Agent shall have received evidence
thereof in form and substance satisfactory to the Administrative Agent.

      9.6. PERFECTION CERTIFICATES. The Administrative Agent shall have received
from the Borrower a completed and fully executed perfection certificate and the
results of collateral searches with respect to the Pledged Collateral,
indicating no liens, encumbrances or security interest other those granted
hereby and otherwise in form and substance satisfactory to the Administrative
Agent, it being understood that current liens in favor of Fleet National Bank,
which liens will be released on the Closing Date, will be evidenced on such
collateral searches.

      9.7. CONTROL AGREEMENT. The Administrative Agent shall have executed, and
shall have received a fully-executed copy of, the Control Agreement, in form and
substance satisfactory to the Administrative Agent.

      9.8. PLEDGED COLLATERAL CERTIFICATE. The Administrative Agent shall have
received from the Borrower the initial Pledged Collateral Certificate dated as
of the Closing Date.

      9.9. OPINION OF COUNSEL. Each of the Lenders and the Administrative Agent
shall have received a favorable legal opinion addressed to the Lenders and the
Administrative Agent, dated as of the Closing Date, in form and substance
satisfactory to the Administrative Agent, from New York and Bermuda counsel to
the Borrower.

      9.10. PAYMENT OF FEES AND EXPENSES. The Borrower shall have paid to the
Lenders or the Administrative Agent, as appropriate, the portion of the Letter
of Credit Fee due on the Closing Date, all other fees required to be paid
pursuant to the Fee Letter and any and all other fees and expenses incurred by
the Administrative Agent or the Lenders in connection with this Reimbursement
and Pledge Agreement and the other Loan Documents, including, without
limitation, legal fees and expenses.

<PAGE>
                                      -48-

      10. CONDITIONS TO ALL LETTER OF CREDIT ISSUANCES.

      The obligations of the Administrative Agent to issue, extend or renew any
Letter of Credit, in each case whether on or after the Closing Date, shall also
be subject to the satisfaction of the following conditions precedent:

      10.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of the Borrower contained in this Reimbursement
and Pledge Agreement, the other Loan Documents or in any document or instrument
delivered pursuant to or in connection with this Reimbursement and Pledge
Agreement shall be true as of the date as of which they were made and shall also
be true at and as of the time of the issuance, extension or renewal of such
Letter of Credit, with the same effect as if made at and as of that time (except
to the extent of changes resulting from transactions contemplated or permitted
by this Reimbursement and Pledge Agreement and the other Loan Documents and
changes occurring in the ordinary course of business that singly or in the
aggregate do not have a Material Adverse Effect, and to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing. The
Administrative Agent shall have received a certificate of the Borrower signed by
an authorized officer of the Borrower to such effect.

      10.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any applicable
law or regulations thereunder or interpretations thereof that in the reasonable
opinion of the Administrative Agent would make it illegal for the Administrative
Agent to issue, extend or renew such Letter of Credit.

      10.3. DOCUMENTS. All documents in connection with the transactions
contemplated by this Reimbursement and Pledge Agreement, the other Loan
Documents and all other documents incident thereto shall be satisfactory in
substance and in form to the Lenders and to the Administrative Agent and the
Administrative Agent's Special Counsel, and the Lenders, the Administrative
Agent and such counsel shall have received all information and such counterpart
originals or certified or other copies of such documents as the Administrative
Agent may reasonably request.

      10.4. PLEDGED COLLATERAL CERTIFICATE. The Administrative Agent shall have
received the most recent Pledged Collateral Certificate required to be delivered
to the Administrative Agent in accordance with Section 6.4(d) and, if requested
by the Administrative Agent, a Pledged
<PAGE>
                                      -49-

Collateral Certificate dated within three (3) days of the issuance, extension or
renewal of such Letter of Credit.

      10.5. COLLATERAL COVERAGE AMOUNT. The Dollar Equivalent of the Aggregate
Maximum Drawing Amount plus the Dollar Equivalent of all Unpaid Reimbursement
Obligations consisting of amounts paid under Letters of Credit, as set forth in
Section 2.2(a)(i), shall not exceed the Collateral Coverage Amount.

      11. EVENTS OF DEFAULT; ACCELERATION; ETC.

      11.1. EVENTS OF DEFAULT AND ACCELERATION. Upon the occurrence and
continuance of any of the following events of default (each an "Event of
Default"):

            (a) default in the payment of any of the Obligations consisting of
      Reimbursement Obligations;

            (b) default in the payment of any Obligations (other than those
      specified in clause (a) above) under any of the Loan Documents, including,
      without limitation, default in the payment of Fees and interest, which
      shall continue for more than three (3) Business Days;

            (c) default in the performance of any of the agreements or covenants
      of the Borrower set forth in Section 6.5, 6.6, 6.8, 6.11, 7.1 or 7.4 or in
      Section 8.2 of Schedule 8 under this Reimbursement and Pledge Agreement
      after the date upon which any applicable grace or cure periods that are
      expressly herein provided shall have elapsed;

            (d) default in the performance of any of the agreements or covenants
      of the Borrower set forth in Section 6.4(e) and continuance of such
      default for a period of 10 days after the date upon which any applicable
      grace or cure periods that are expressly herein provided shall have
      elapsed;

            (e) default in the performance of any of the agreements or covenants
      of the Borrower set forth in Section 8.1 of Schedule 8 and continuance of
      such default for a period of 30 days unless a Cure Contribution is made
      during such 30 days;

            (f) default in the performance of any of the agreements or covenants
      of the Borrower under this Reimbursement and Pledge Agreement or any other
      Loan Document (other than those specified in Sections 11.1(a), (b), (c),
      (d) or (e) above and continuance of such default for a period of 30 days
      after the date upon which (x) any
<PAGE>
                                      -50-

      Responsible Officer had actual knowledge of such default or (y) any
      applicable grace or cure periods that are expressly herein provided shall
      have elapsed;

            (g) the Control Agreement is terminated by any party thereto and the
      Borrower, the Administrative Agent and another securities intermediary
      satisfactory to the Administrative Agent and the Required Lenders have
      not, as of the date that is three (3) Business Days prior to the effective
      date of such termination, entered into a control agreement in form and
      substance reasonably satisfactory to the Administrative Agent, such that
      the Administrative Agent's first priority lien and security interest in
      the Pledged Collateral is preserved unimpaired;

            (h) the Administrative Agent's security interest in the Pledged
      Collateral shall cease to be a first priority perfected security interest,
      otherwise than in accordance with the terms hereof, or in connection with
      (i) liens arising by operation of law, so long as the aggregate
      obligations secured thereby do not exceed $1,000,000 or (ii) the Custodial
      Lien and Set-Off Rights or with the express prior written agreement,
      consent or approval of the Administrative Agent and the Required Lenders;
      or any action at law, suit or in equity or other legal proceeding to
      cancel, revoke or rescind this Reimbursement and Pledge Agreement or any
      Loan Document shall be commenced by or on behalf of the Borrower or any of
      its shareholders, or any court or any other governmental or regulatory
      authority or agency of competent jurisdiction shall make a determination
      that, or issue a judgment, order, decree or ruling to the effect that, the
      Reimbursement and Pledge Agreement or any one or more of the Loan
      Documents is illegal, invalid or unenforceable in accordance with the
      terms thereof;

            (i) the Borrower shall be enjoined, restrained or in any way
      prevented by the order of any court or any administrative or regulatory
      agency from conducting any material part of its business and such order
      shall continue in effect for more than thirty (30) days;

            (j) the Borrower admits in writing that it is generally unable to
      pay debts as they mature or become due;

            (k) the Borrower makes a general assignment for the benefit of
      creditors;

            (l) any of the Pledged Collateral is subject to any lien or
      encumbrance or any claim or demand, other than (i) liens arising
<PAGE>
                                      -51-

      by operation of law, so long as the aggregate obligations secured thereby
      do not exceed $1,000,000 or (ii) the Custodial Lien and Set-Off Rights,
      that if unpaid might by law or upon bankruptcy, insolvency or otherwise,
      be given any priority whatsoever over the Borrower's general creditors
      with respect to the Pledged Collateral or is transferred for the purposes
      of the payment of indebtedness not arising hereunder or is taken by
      attachment, execution or any other form of legal process and/or the
      commencement of a proceeding by or against the Borrower under the federal
      bankruptcy code or the equivalent under Bermuda law, or any other federal,
      state or Bermuda laws seeking to adjudicate the Borrower a bankrupt or
      insolvent, or seeking the liquidation, winding up, reorganization,
      arrangement, adjustment, protection, relief or composition of the Borrower
      or its debts under any law relating to bankruptcy, insolvency or
      reorganization or relief of debtors, or seeking the entry of an order for
      relief or the appointment of a receiver, liquidator, assignee, custodian,
      trustee, sequestrator, debtor in possession, examiner or other similar
      official for the Borrower, the Pledged Collateral or any substantial part
      of the Borrower's property, with or without consent of the Borrower, for
      any purpose whatsoever and, in the case of any such proceeding instituted
      against the Borrower (but not instituted by it), either such proceeding
      shall remain unstayed and undismissed for a period of sixty (60) days; or
      any of the following actions sought in such proceeding shall occur: the
      entry of an order for relief against, or the appointment of a receiver,
      trustee, custodian or other similar official for, the Borrower, the
      Pledged Collateral or for any substantial part of its property;

            (m) the assertion of any levy, seizure or attachment on the Pledged
      Collateral, other than with respect to the Custodial Lien and Set-Off
      Rights, or the taking of any action by a regulatory authority to obtain
      control of the Borrower, a substantial part of its assets (which shall not
      have been vacated, discharged or stayed or bonded pending appeal within
      sixty (60) days from the entry thereof), or any part of the Pledged
      Collateral, other than with respect to the Custodial Lien and Set-Off
      Rights;

            (n) a Change in Control shall occur; or

            (o) there shall occur any (i) default in the payment when due
      (subject to any applicable grace period), whether by acceleration or
      otherwise, of any other Debt (as defined on Schedule 8 hereto) of the
      Borrower or any of its Subsidiaries if the aggregate amount of Debt of the
      Borrower and/or any of its
<PAGE>
                                      -52-

      Subsidiaries which is accelerated or due and payable, or which (subject to
      any applicable grace period) may be accelerated or otherwise become due
      and payable, by reason of such default or defaults is $5,000,000 or more,
      or (ii) default in the performance or observance of any obligation or
      condition with respect to any such other Debt of, or guaranteed by, the
      Borrower and/or any of its Subsidiaries if the effect of such default or
      defaults is to accelerate the maturity (subject to any applicable grace
      period) of any such Debt of $5,000,000 or more in the aggregate or to
      permit the holder or holders of such indebtedness of $5,000,000 or more in
      the aggregate, or any trustee or agent for such holders, to cause such
      Debt to become due and payable prior to its expressed maturity;

If any Event of Default shall have occurred and be continuing, the
Administrative Agent may and, upon the request of the Required Lenders, shall,
by notice to the Borrower, terminate the unused portion of the credit hereunder,
and upon such notice being given such unused portion of the credit hereunder
shall terminate immediately and the Administrative Agent shall be relieved of
all further obligations to issue, extend or renew Letters of Credit. No
termination of the credit hereunder shall relieve the Borrower or any of its
Subsidiaries of any of the Obligations. Notwithstanding anything to the contrary
contained herein, no notice given or declaration by the Administrative Agent
pursuant to this Section 11 shall affect (i) the obligation of the Lenders or
the Administrative Agent to make any payment under any Letter of Credit in
accordance with the terms of such Letter of Credit or (ii) the obligations of
each Lender in respect of each Letter of Credit.

If any Event of Default shall occur and be continuing, the Administrative Agent
may or at the request of the Required Lenders, shall, with or without prior
notice to the Borrower, and without demand for additional collateral, (a)
transfer, or cause the Custodian to transfer any or all of the Pledged
Collateral and/or the Securities Account and/or the Deposit Account into the
name of the Administrative Agent or its nominee (including, without limitation,
having the Pledged Collateral debited from the Securities Account and/or the
Deposit Account and credited to an account designated by the Administrative
Agent) and vote any Pledged Collateral constituting securities or closely held
Capital Stock; (b) sell at public or private sale any or all of the Pledged
Collateral, which the Administrative Agent may purchase free from any right of
redemption; (c) apply to, or set off against, the Obligations of the Borrower
all or any portion of the Pledged Collateral, securities or other property of
the Borrower in the possession of the Administrative Agent; (d) convert any of
the Pledged Collateral or any proceeds thereof into Pounds Sterling, with
<PAGE>
                                      -53-

any such conversion costs being considered a collection expense and added to the
Obligations; and (e) at its discretion in its own name or in the name of the
Borrower take any action for the collection of the Pledged Collateral, including
the filing of a proof of claim in insolvency proceedings, and may receive the
proceeds thereof and execute releases therefor. After deducting its expenses,
including reasonable out-of-pocket attorney's fees, incurred in the sale or
collection of the Pledged Collateral, the Administrative Agent shall apply the
proceeds to the Obligations and shall account to the Borrower for any surplus.
The Borrower agrees that the Administrative Agent has no obligation to sell or
otherwise liquidate the Pledged Collateral in any particular order or to apply
the proceeds thereof to any particular portion of the Obligations. The Borrower
further agrees that after the occurrence and during the continuance of an Event
of Default, to the extent that any voting rights exist, the Administrative Agent
shall have no obligation to vote any Pledged Collateral constituting securities
or closely held Capital Stock but shall have the right to do so in its sole
discretion.

In connection with any secured party's sale, the Administrative Agent is
authorized, if it deems it advisable to do so, in order to comply with any
applicable securities laws, to restrict the prospective bidders or purchasers to
persons who will represent and agree that they are purchasing the Pledged
Collateral for their own account for investment, and not with a view to the
distribution or re-sale thereof. Sales made subject to such restriction shall be
deemed to have been made in a commercially reasonable manner.
<PAGE>
                                      -54-

                          12. THE ADMINISTRATIVE AGENT.

      12.1. AUTHORIZATION.

            (a) The Administrative Agent is authorized to take such action on
      behalf of each of the Lenders and to exercise all such powers as are
      hereunder and under any of the other Loan Documents and any related
      documents delegated to the Administrative Agent, together with such powers
      as are reasonably incident thereto, including the authority, without the
      necessity of any notice to or further consent of the Lenders, from time to
      time to take any action with respect to any Pledged Collateral which may
      be necessary to perfect, maintain perfected or insure the priority of the
      security interest in and liens upon the Pledged Collateral, provided that
      no duties or responsibilities not expressly assumed herein or therein
      shall be implied to have been assumed by the Administrative Agent.

            (b) The relationship between the Administrative Agent and each of
      the Lenders is that of an independent contractor. The use of the term
      "Administrative Agent" is for convenience only and is used to describe, as
      a form of convention, the independent contractual relationship between the
      Administrative Agent and each of the Lenders. Nothing contained in this
      Reimbursement and Pledge Agreement nor the other Loan Documents shall be
      construed to create an agency, trust or other fiduciary relationship
      between the Administrative Agent and any of the Lenders.

            (c) As an independent contractor empowered by the Lenders to
      exercise certain rights and perform certain duties and responsibilities
      hereunder and under the other Loan Documents, the Administrative Agent is
      nevertheless a "representative" of the Lenders, as that term is defined in
      Article 1 of the Uniform Commercial Code, for purposes of actions for the
      benefit of the Lenders and the Administrative Agent with respect to all
      collateral security and guaranties contemplated by the Loan Documents.
      Such actions include the designation of the Administrative Agent as
      "secured party", "mortgagee" or the like on all financing statements and
      other documents and instruments, whether recorded or otherwise, relating
      to the attachment, perfection, priority or enforcement of any security
      interests, mortgages or deeds of trust in collateral security intended to
      secure the payment or performance of any of the Obligations, all for the
      benefit of the Lenders and the Administrative Agent.
<PAGE>
                                      -55-

      12.2. EMPLOYEES AND ADMINISTRATIVE AGENTS. The Administrative Agent may
exercise its powers and execute its duties by or through employees or agents and
shall be entitled to take, and to rely on, advice of counsel concerning all
matters pertaining to its rights and duties under this Reimbursement and Pledge
Agreement and the other Loan Documents. The Administrative Agent may utilize the
services of such Persons as the Administrative Agent in its sole discretion may
reasonably determine.

      12.3. NO LIABILITY. Neither the Administrative Agent nor any of its
shareholders, directors, officers or employees nor any other Person assisting
them in their duties nor any agent or employee thereof, shall be liable for any
waiver, consent or approval given or any action taken, or omitted to be taken,
in good faith by it or them hereunder or under any of the other Loan Documents,
or in connection herewith or therewith, or be responsible for the consequences
of any oversight or error of judgment whatsoever, except that the Administrative
Agent or such other Person, as the case may be, shall be liable for losses due
to its willful misconduct or gross negligence.

      12.4. NO REPRESENTATIONS.

            12.4.1. GENERAL. The Administrative Agent shall not be responsible
      for the execution or validity or enforceability of this Reimbursement and
      Pledge Agreement, the Letters of Credit, any of the other Loan Documents
      or any instrument at any time constituting, or intended to constitute,
      collateral security for the Obligations, or for the value of any such
      collateral security or for the validity, enforceability or collectability
      of any such amounts owing with respect to any of the Obligations, or for
      any recitals or statements, warranties or representations made herein or
      in any of the other Loan Documents or in any certificate or instrument
      hereafter furnished to it by or on behalf of the Borrower or any of its
      Subsidiaries, or be bound to ascertain or inquire as to the performance or
      observance of any of the terms, conditions, covenants or agreements herein
      or in any instrument at any time constituting, or intended to constitute,
      collateral security for the Obligations or to inspect any of the
      properties, books or records of the Borrower or any of its Subsidiaries.
      The Administrative Agent shall not be bound to ascertain whether any
      notice, consent, waiver or request delivered to it by the Borrower or any
      Lender shall have been duly authorized or is true, accurate and complete.
      The Administrative Agent has not made nor does it now make any
      representations or warranties, express or implied, nor does it assume any
      liability to the Lenders, with respect to the credit
<PAGE>
                                      -56-

      worthiness or financial conditions of the Borrower or any of its
      Subsidiaries. Each Lender acknowledges that it has, independently and
      without reliance upon the Administrative Agent or any other Lender, and
      based upon such information and documents as it has deemed appropriate,
      made its own credit analysis and decision to enter into this Reimbursement
      and Pledge Agreement.

            12.4.2. CLOSING DOCUMENTATION, ETC. For purposes of determining
      compliance with the conditions set forth in Section 12, each Lender that
      has executed this Reimbursement and Pledge Agreement shall be deemed to
      have consented to, approved or accepted, or to be satisfied with, each
      document and matter either sent, or made available, by the Administrative
      Agent or the Arranger to such Lender for consent, approval, acceptance or
      satisfaction, or required thereunder to be consented to or approved by or
      acceptable or satisfactory to such Lender, unless an officer of the
      Administrative Agent or the Arranger active upon the Borrower's account
      shall have received notice from such Lender not less than two (2) days
      prior to the Closing Date specifying such Lender's objection thereto and
      such objection shall not have been withdrawn by notice to the
      Administrative Agent or the Arranger to such effect on or prior to the
      Closing Date.

      12.5. PAYMENTS.

            12.5.1. PAYMENTS TO ADMINISTRATIVE AGENT. A payment by the Borrower
      to the Administrative Agent hereunder or any of the other Loan Documents
      for the account of any Lender shall constitute a payment to such Lender.
      The Administrative Agent agrees promptly to distribute to each Lender such
      Lender's pro rata share of payments received by the Administrative Agent
      for the account of the Lenders except as otherwise expressly provided
      herein or in any of the other Loan Documents.

            12.5.2. DISTRIBUTION BY ADMINISTRATIVE AGENT. If in the opinion of
      the Administrative Agent the distribution of any amount received by it in
      such capacity hereunder or under any of the other Loan Documents might
      involve it in liability, it may refrain from making distribution until its
      right to make distribution shall have been adjudicated by a court of
      competent jurisdiction. If a court of competent jurisdiction shall adjudge
      that any amount received and distributed by the Administrative Agent is to
      be repaid, each Person to whom any such distribution shall have been made
      shall either repay to the Administrative Agent its proportionate share of
<PAGE>
                                      -57-

      the amount so adjudged to be repaid or shall pay over the same in such
      manner and to such Persons as shall be determined by such court.

            12.5.3. DELINQUENT LENDERS. Notwithstanding anything to the contrary
      contained in this Reimbursement and Pledge Agreement or any of the other
      Loan Documents, any Lender that fails (a) to purchase any Letter of Credit
      Participation or (b) to comply with the provisions of Section 14.2 with
      respect to making dispositions and arrangements with the other Lenders,
      where such Lender's share of any payment received, whether by setoff or
      otherwise, is in excess of its pro rata share of such payments due and
      payable to all of the Lenders, in each case as, when and to the full
      extent required by the provisions of this Reimbursement and Pledge
      Agreement, shall be deemed delinquent (a "Delinquent Lender") and shall be
      deemed a Delinquent Lender until such time as such delinquency is
      satisfied. A Delinquent Lender shall be deemed to have assigned any and
      all payments due to it from the Borrower, whether on account of Unpaid
      Reimbursement Obligations, interest, fees or otherwise, to the remaining
      nondelinquent Lenders for application to, and reduction of, their
      respective pro rata shares of all Unpaid Reimbursement Obligations. The
      Delinquent Lender hereby authorizes the Administrative Agent to distribute
      such payments to the nondelinquent Lenders in proportion to their
      respective pro rata shares of all Unpaid Reimbursement Obligations. A
      Delinquent Lender shall be deemed to have satisfied in full a delinquency
      when and if, as a result of application of the assigned payments to all
      Unpaid Reimbursement Obligations of the nondelinquent Lenders, the
      Lenders' respective pro rata shares of all Unpaid Reimbursement
      Obligations have returned to those in effect immediately prior to such
      delinquency and without giving effect to the nonpayment causing such
      delinquency.

      12.6. HOLDERS OF PARTICIPATIONS. The Administrative Agent may deem and
treat the purchaser of any Letter of Credit Participation as the absolute owner
or purchaser thereof for all purposes hereof until it shall have been furnished
in writing with a different name by such purchaser or by a subsequent holder,
assignee or transferee.

      12.7. INDEMNITY. The Lenders ratably agree hereby to indemnify and hold
harmless the Administrative Agent and its Affiliates from and against any and
all claims, actions and suits (whether groundless or otherwise), losses,
damages, costs, expenses (including any expenses for which the Administrative
Agent or such Affiliate has not been reimbursed
<PAGE>
                                      -58-

by the Borrower as required by Section 14.3), and liabilities of every nature
and character arising out of or related to this Reimbursement and Pledge
Agreement or any of the other Loan Documents (including without limitation, the
Administrative Agent's indemnity obligations under the Control Agreement), or
the transactions contemplated or evidenced hereby or thereby, or the
Administrative Agent's actions taken hereunder or thereunder, except to the
extent that any of the same shall be directly caused by the Administrative
Agent's willful misconduct or gross negligence.

      12.8. ADMINISTRATIVE AGENT AS LENDER. In its individual capacity, Fleet
shall have the same obligations and the same rights, powers and privileges in
respect to its Commitment and as the purchaser of any Letter of Credit
Participations, as it would have were it not also the Administrative Agent.

      12.9. RESIGNATION. The Administrative Agent may resign at any time by
giving sixty (60) days prior written notice thereof to the Lenders and the
Borrower. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor Administrative Agent. Unless a Default or Event of
Default shall have occurred and be continuing, such successor Administrative
Agent shall be reasonably acceptable to the Borrower. If no successor
Administrative Agent shall have been so appointed by the Required Lenders and
shall have accepted such appointment within thirty (30) days after the retiring
Administrative Agent's giving of notice of resignation, then the retiring
Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent, which shall be a financial institution (a) having a senior
unsecured debt rating of not less than "A+" or its equivalent by S&P and (b) so
long as no Default or Event of Default has occurred, approved by the Borrower in
its reasonable discretion. If no successor shall have been so appointed and
accepted within sixty (60) days after the retiring Administrative Agent's giving
of notice of resignation, then the retiring Administrative Agent's registration
shall nonetheless become effective and (1) the retiring Administrative Agent
shall be discharged form its duties and obligations hereunder and (2) the
Required Lenders shall perform the duties of the Administrative Agent (and all
payments and communications provided to be made by, to or through the
Administrative Agent shall instead be made by or to each Lender directly) until
such time as the Required Lenders appoint a successor Administrative Agent as
provided for above in this paragraph. Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Administrative
Agent, and
<PAGE>
                                      -59-

the retiring Administrative Agent shall be discharged from its duties and
obligations hereunder. After any retiring Administrative Agent's resignation,
the provisions of this Reimbursement and Pledge Agreement and the other Loan
Documents shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as Administrative Agent.

      12.10. ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM.

            (a) In case of the pendency of any receivership, insolvency,
      liquidation, bankruptcy, reorganization, arrangement, adjustment,
      composition or other judicial, administrative or like proceeding or any
      assignment for the benefit of creditors relative to the Borrower or any of
      its Subsidiaries, the Administrative Agent (irrespective of whether the
      principal of any Reimbursement Obligation or Unpaid Reimbursement
      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, under any such assignment
      or otherwise:

                  (i) to file and prove a claim for the whole amount of the
            principal and interest owing and unpaid in respect of the
            Reimbursement Obligations or Unpaid Reimbursement 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 this Reimbursement and Pledge
            Agreement) allowed in such proceeding or under any such assignment;
            and

                  (ii) to collect and receive any monies or other property
            payable or deliverable on any such claims and to distribute the
            same;

            (b) Any custodian, receiver, assignee, trustee, liquidator,
      sequestrator or other similar official in any such proceeding or under any
      such assignment 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
<PAGE>
                                      -60-

      payments directly to the Lenders, nevertheless 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 this Reimbursement and Pledge Agreement.

            (c) Nothing contained herein shall authorize the Administrative
      Agent to consent to or accept or adopt on behalf of any Lender any plan of
      reorganization, arrangement, adjustment or composition affecting the
      Obligations owed to such Lender 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 or under any such assignment.

      12.11. NOTIFICATION OF DEFAULTS AND EVENTS OF DEFAULT. Each Lender hereby
agrees that, upon learning of the existence of a Default or an Event of Default,
it shall promptly notify the Administrative Agent thereof. The Administrative
Agent hereby agrees that upon receipt of any notice under this Section 12.11 it
shall promptly notify the other Lenders of the existence of such Default or
Event of Default.

      12.12. DUTIES IN THE CASE OF ENFORCEMENT. In case one of more Events of
Default have occurred and shall be continuing, and whether or not acceleration
of the Obligations shall have occurred, the Administrative Agent shall, if (a)
so requested by the Required Lenders and (b) the Lenders have provided to the
Administrative Agent such additional indemnities and assurances against expenses
and liabilities as the Administrative Agent may reasonably request, proceed to
enforce the provisions of this Reimbursement and Pledge Agreement and the other
Loan Documents authorizing the sale or other disposition of all or any part of
the Pledged Collateral and exercise all or any such other legal and equitable
and other rights or remedies as it may have in respect of such Pledged
Collateral. The Required Lenders may direct the Administrative Agent in writing
as to the method and the extent of any such sale or other disposition, the
Lenders hereby agreeing to indemnify and hold the Administrative Agent, harmless
from all liabilities incurred in respect of all actions taken or omitted in
accordance with such directions, provided that the Administrative Agent need not
comply with any such direction to the extent that the Administrative Agent
reasonably believes the Administrative Agent's compliance with such direction to
be unlawful or commercially unreasonable in any applicable jurisdiction.
<PAGE>
                                      -61-

                           13. SUCCESSORS AND ASSIGNS.

      13.1. GENERAL CONDITIONS. The provisions of this Reimbursement and Pledge
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
(a) to an Eligible Assignee in accordance with the provisions of Section 13.2,
or (b) by way of participation in accordance with the provisions of Section 13.4
or (c) by way of pledge or assignment of a security interest subject to the
restrictions of Section 13.6 (and any other attempted assignment or transfer by
any party hereto shall be null and void). Nothing in this Reimbursement and
Pledge 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 Section 13.4 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 Reimbursement and Pledge Agreement or any of
the other Loan Documents.

      13.2. ASSIGNMENTS. Any Lender may at any time assign to one or more
Eligible Assignees all or a portion of its rights and obligations under this
Reimbursement and Pledge Agreement (including all or a portion of its
Commitment); provided that (a) except in the cases of an assignment of the
entire remaining amount of the assigning Lender's Commitment or, of an
assignment to a Lender or a Lender Affiliate, the aggregate amount of the
Commitment shall not be less than $5,000,000 unless each of the Administrative
Agent and, so long as no Default or Event of Default has occurred and is
continuing, the Borrower, otherwise consent (each such consent not to be
unreasonably withheld or delayed); (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 Reimbursement and Pledge Agreement with respect the
Commitment assigned, it being understood that non-pro rata assignments of or
among any of the Commitments and the Reimbursement Obligations are not
permitted; (c) any assignment of a Commitment must be approved by the
Administrative Agent and so long as no Default or Event of Default has occurred
and is continuing, the Borrower, (such approval of the Borrower not to be
unreasonably withheld), unless the Person that is the proposed assignee is
itself a Lender with a Commitment; and (d) the parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Acceptance,
together with a processing and recordation
<PAGE>
                                      -62-

fee of $3,500 (provided that such processing and recordation fee may be waived
by the Administrative Agent, in its sole discretion) and the Eligible Assignee,
if it shall not be a Lender, shall deliver to the Administrative Agent an
Administrative Questionnaire. Subject to acceptance and recording thereof by the
Administrative Agent pursuant to Section 13.3, from and after the effective date
specified in each Assignment and Acceptance, the Eligible Assignee thereunder
shall be a party to this Reimbursement and Pledge Agreement and, to the extent
of the interest assigned by such Assignment and Acceptance have the rights and
obligations of a Lender under this Reimbursement and Pledge Agreement, and the
assigning Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Acceptance, be released from its obligations under this
Reimbursement and Pledge Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender's rights and obligations under
this Reimbursement and Pledge Agreement, such Lender shall cease to be a party
hereto) but shall continue to be entitled to the benefits of Sections 14.3 and
14.4 with respect to facts and circumstances occurring prior to the effective
date of such assignment. Any assignment or transfer by a Lender of rights or
obligations under this Reimbursement and Pledge Agreement that does not comply
with this paragraph shall be treated for purposes of this Reimbursement and
Pledge Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with Section 13.4.

      13.3. REGISTER. 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 Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of
each Lender pursuant to the terms hereof from time to time (the "Register"). The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Reimbursement and Pledge 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.

      13.4. PARTICIPATIONS. 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) (each, a "Participant") in all or a
portion of such Lender's rights and/or obligations under this Reimbursement and
Pledge Agreement (including all or a portion of its Commitment); provided that
(a) such Lender's obligations under this Reimbursement and Pledge Agreement
shall
<PAGE>
                                      -63-

remain unchanged, (b) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations and (c) 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 Reimbursement and Pledge 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 Reimbursement and
Pledge Agreement and to approve any amendment, modification or waiver of any
provision of this Reimbursement and Pledge 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 that
would extend the term or increase the amount of the Commitment of such Lender as
it relates to such Participant, reduce the amount of any Letter of Credit Fee to
which such Participant is entitled or extend any regularly scheduled payment
date for principal or interest. Subject to Section 13.5, the Borrower agrees
that each Participant shall be entitled to the benefits of Sections 3.3.2, 3.4
and 3.5 to the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to Section 13.2. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 14.2 as though it
were a Lender, provided such Participant agrees to be subject to Section 14.2 as
though it were a Lender.

      13.5. PAYMENTS TO PARTICIPANTS. A Participant shall not be entitled to
receive any greater payment under Sections 3.2.2, 3.4 and 3.5 than the
applicable Lender would have been entitled to receive with respect to the
participation sold to such Participant.

      13.6. MISCELLANEOUS ASSIGNMENT PROVISIONS. A Lender may at any time grant
a security interest in all or any portion of its rights under this Reimbursement
and Pledge Agreement to secure obligations of such Lender, in connection with
any pledge or assignment to secure obligations to any of the twelve Federal
Reserve Administrative Agents organized under Section 4 of the Federal Reserve
Act, 12 U.S.C. Section 341; provided that no such grant shall release such
Lender from any of its obligations hereunder, provide any voting rights
hereunder to the secured party thereof, substitute any such secured party for
such Lender as a party hereto or affect any rights or obligations of the
Borrower or Administrative Agent hereunder.

      13.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWER. If any
assignee Lender is an Affiliate of the Borrower, then any such assignee Lender
shall have no right to vote as a Lender hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other
<PAGE>
                                      -64-

modifications to any of the Loan Documents or for purposes of making requests to
the Administrative Agent pursuant to Section 11, and the determination of the
Required Lenders shall for all purposes of this Reimbursement and Pledge
Agreement and the other Loan Documents be made without regard to such assignee
Lender's interest in any of the Reimbursement Obligations. If any Lender sells a
participating interest in any of the Reimbursement Obligations to a Participant,
and such Participant is the Borrower or an Affiliate of the Borrower, then such
transferor Lender shall promptly notify the Administrative Agent of the sale of
such participation. A transferor Lender shall have no right to vote as a Lender
hereunder or under any of the other Loan Documents for purposes of granting
consents or waivers or for purposes of agreeing to amendments or modifications
to any of the Loan Documents or for purposes of making requests to the
Administrative Agent pursuant to Section 11 to the extent that such
participation is beneficially owned by the Borrower or any Affiliate of the
Borrower, and the determination of the Required Lenders shall for all purposes
of this Reimbursement and Pledge Agreement and the other Loan Documents be made
without regard to the interest of such transferor Lender in the Reimbursement
Obligations to the extent of such participation.

                     14. PROVISIONS OF GENERAL APPLICATIONS.

      14.1. AUTHORIZATION TO FILE FINANCING STATEMENTS. The Administrative Agent
is hereby authorized to file in any Uniform Commercial Code filing office a
financing statement naming the Borrower as the debtor and indicating the
collateral as the Pledged Collateral, including, the Securities Account and the
Deposit Account and all property held therein and any and all proceeds of any
thereof, whether now or hereafter existing or arising.

      14.2. SETOFF. The Borrower hereby grants to the Administrative Agent and
each of the Lenders a continuing lien, security interest and right of setoff as
security for all liabilities and obligations to the Administrative Agent and
each Lender, whether now existing or hereafter arising, upon and against all
deposits, credits, collateral and property, now or hereafter in the possession,
custody, safekeeping or control of the Administrative Agent or such Lender or
any Lender Affiliate and their successors and assigns or in transit to any of
them. Regardless of the adequacy of any collateral, if any of the Obligations
are due and payable and have not been paid or any Event of Default shall have
occurred, any deposits or other sums credited by or due from any of the Lenders
to the Borrower and any securities or other property of the Borrower in the
possession of such Lender may be applied to or set off by such Lender against
the payment of Obligations and any and all other liabilities,
<PAGE>
                                      -65-

direct, or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising, of the Borrower to such Lender. ANY AND ALL RIGHTS TO
REQUIRE ANY LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER
COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF
SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWER
ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. Each of the Lenders
agree with each other Lender that (a) if an amount to be set off is to be
applied to indebtedness of the Borrower to such Lender, other than indebtedness
constituting Reimbursement Obligations owed to such Lender, such amount shall be
applied ratably to such other indebtedness and to the indebtedness constituting
Reimbursement Obligations owed to such Lender, and (b) if such Lender shall
receive from the Borrower, whether by voluntary payment, exercise of the right
of setoff, counterclaim, cross action, enforcement of the claim constituting
Reimbursement Obligations owed to, such Lender by proceedings against the
Borrower at law or in equity or by proof thereof in bankruptcy, reorganization,
liquidation, receivership or similar proceedings, or otherwise, and shall retain
and apply to the payment of the Reimbursement Obligations owed to, such Lender
any amount in excess of its ratable portion of the payments received by all of
the Lenders with respect to the Reimbursement Obligations owed to, all of the
Lenders, such Lender will make such disposition and arrangements with the other
Lenders with respect to such excess, either by way of distribution, pro tanto
assignment of claims, subrogation or otherwise as shall result in each Lender
receiving in respect of the Reimbursement Obligations owed it, its proportionate
payment as contemplated by this Reimbursement and Pledge Agreement; provided
that if all or any part of such excess payment is thereafter recovered from such
Lender, such disposition and arrangements shall be rescinded and the amount
restored to the extent of such recovery, but without interest.

      14.3. EXPENSES. The Borrower agrees to pay (a) the reasonable costs of
producing and reproducing this Reimbursement and Pledge Agreement, the other
Loan Documents and the other agreements and instruments mentioned herein, (b)
the reasonable fees, expenses and disbursements of the Administrative Agent's
Special Counsel or any local counsel to the Administrative Agent incurred in
connection with the preparation, syndication, administration or interpretation
of the Loan Documents and other instruments mentioned herein, each closing
hereunder, any amendments, modifications, approvals, consents or waivers hereto
or hereunder, or the cancellation of any Loan Document upon payment in full of
all of the Obligations or pursuant to any terms of such Loan Document for
providing for such cancellation, (c) the fees,
<PAGE>
                                      -66-

expenses and disbursements of the Administrative Agent and the Arranger incurred
by the Administrative Agent or the Arranger in connection with the preparation,
syndication, administration or interpretation of the Loan Documents and other
instruments mentioned herein, (d) all reasonable out-of-pocket expenses
(including without limitation reasonable attorneys' fees and costs, which
attorneys may be employees of any Lender or the Administrative Agent, and
reasonable consulting, accounting, appraisal, investment banking and similar
professional fees and charges so long as the engagement of such professionals is
reasonable) incurred by any Lender or the Administrative Agent in connection
with (i) the enforcement of or preservation of rights under any of the Loan
Documents against the Borrower or any of its Subsidiaries or the administration
thereof after the occurrence of a Default or Event of Default and (ii) any
litigation or proceeding arising hereunder or related hereto or in any way
related to any Lender's or the Administrative Agent's relationship hereunder
with the Borrower or any of its Subsidiaries and (e) all reasonable fees,
expenses and disbursements of any Lender or the Administrative Agent incurred in
connection with UCC searches or UCC filings. The covenants contained in this
Section 14.3 shall survive payment or satisfaction in full of all other
obligations.

      14.4. INDEMNIFICATION. The Borrower agrees to indemnify and hold harmless
the Administrative Agent, its Affiliates and the Lenders and their respective
Affiliates, directors, officers, employees, agents and advisors (collectively,
the "Indemnitees") from and against any and all claims, actions and suits
whether groundless or otherwise, and from and against any and all liabilities,
losses, damages and expenses of every nature and character arising out of this
Reimbursement and Pledge Agreement or any of the other Loan Documents or the
transactions contemplated hereby including, without limitation, (a) any actual
or proposed use by the Borrower or any of its Subsidiaries of the Letters of
Credit, (b) any payments to the Custodian or in connection with the Pledged
Collateral or (c) the Borrower entering into or performing this Reimbursement
and Pledge Agreement or any of the other Loan Documents, in each case including,
without limitation, the reasonable fees and disbursements of counsel and
allocated costs of internal counsel incurred in connection with any such
investigation, litigation or other proceeding; provided however that the
Borrower shall have no obligation to indemnify any Indemnitee for any liability,
losses, damages or expenses resulting solely from the gross negligence or
willful misconduct of such Indemnitee. Subject to Section 14.5 below, in
litigation, or the preparation therefor, the Indemnitees shall be entitled to
select their own counsel and, in addition to the foregoing indemnity, the
Borrower agrees to pay promptly the reasonable fees and expenses of such
<PAGE>
                                      -67-

counsel. If, and to the extent that the obligations of the Borrower under this
Section 14.4 are unenforceable for any reason, the Borrower hereby agrees to
make the maximum contribution to the payment in satisfaction of such obligations
which is permissible under applicable law. The covenants contained in this
Section 14.4 shall survive payment or satisfaction in full of all other
Obligations.

      14.5. PAYMENTS BY BORROWER WITH RESPECT TO INDEMNIFIED PERSONS.

      (a) Any Person entitled to reimbursement for expenses pursuant to Section
14.3 or indemnification pursuant to Section 14.4 (an "Indemnified Person") shall
promptly notify the Borrower in writing as to any action, claim, suit,
proceeding or investigation for which indemnity may be sought. After such notice
to the Borrower, so long as the position of the Borrower is not adverse to that
of the Indemnified Person, the Borrower shall be entitled to participate in, and
to the extent that it shall elect by written notice delivered to such
Indemnified Person promptly after receiving the aforesaid notice of such
Indemnified Person, to assume the defense thereof with counsel reasonably
satisfactory to such Indemnified Person to represent such Indemnified Person in
such action, claim, suit, proceeding or investigation and shall pay as incurred
the reasonable fees and expenses of such counsel related to such action, claim,
suit, proceeding or investigation.

      (b) In any action, claim, suit, proceeding or investigation, any
Indemnified Person shall have the right to retain its own separate counsel at
such Indemnified Person's own expense and not subject to reimbursement by the
Borrower; provided, however, that the Borrower shall pay as incurred the
reasonable fees and expenses of such counsel incurred in connection with
investigating, preparing, defending, paying, settling or compromising any
action, claim, suit, proceeding or investigation if (i) the parties to such
action, claim, suit, proceeding or investigation include both the Indemnified
Person and the Borrower and there may be legal defenses available to such
Indemnified Person which are different from or additional to those available to
the Borrower; (ii) the use of counsel chosen by the Borrower to represent both
the Borrower and such Indemnified Person would present such counsel with an
actual or potential conflict of interest; (iii) the Borrower shall not have
employed satisfactory counsel to represent the Indemnified Person within a
reasonable time after notice of the institution of such action, claim, suit,
proceeding or investigation; (iv) the Borrower has not provided the Indemnified
Person with adequate assurance of its acceptance of its liability for the
underlying claim pursuant to Section 14.4 and of its financial capacity to pay
the full amount of such underlying claim or (v) the
<PAGE>
                                      -68-

Borrower shall authorize the Indemnified Person to employ separate counsel (in
addition to any local counsel) at the expense of the Borrower. The Borrower
shall not, in connection with any action, claim, suit, proceeding or
investigation, be liable for the fees and expenses of more than one separate
firm of legal counsel for all Indemnified Parties, except to the extent the use
of one counsel to represent all Indemnified Persons would present such counsel
with an actual or potential conflict of interest, and in the event that separate
counsel is to be retained to represent one or more Indemnified Parties, such
separate counsel shall be chosen by Administrative Agent.

      (c) Each Indemnified Person agrees that, unless the Borrower is unable to
comply with the provisions set forth in Section 14.5(a) above, without the
Borrower's prior written consent (not to be unreasonably withheld), it will not
settle, compromise or consent to the entry of any judgment in or otherwise seek
to terminate any claim, action, suit, proceeding or investigation in respect of
which indemnification could be sought hereunder unless such settlement,
compromise, consent or termination includes an unconditional release of the
Borrower and the Indemnified Person from all liabilities arising out of such
claim, action, suit, proceeding or investigation.

      14.6. SURVIVAL OF COVENANTS, ETC. All covenants, agreements,
representations and warranties made herein, in any of the other Loan Documents
or in any documents or other papers delivered by or on behalf of the Borrower or
any of its Subsidiaries pursuant hereto shall be deemed to have been relied upon
by the Lenders and the Administrative Agent, notwithstanding any investigation
heretofore or hereafter made by any of them, and shall survive the issuance,
extension or renewal of any Letters of Credit, as herein contemplated, and shall
continue in full force and effect so long as any Letter of Credit or any amount
due under this Reimbursement and Pledge Agreement or any of the other Loan
Documents remains outstanding or the Administrative Agent has any obligation to
issue, extend or renew any Letter of Credit, and for such further time as may be
otherwise expressly specified in this Reimbursement and Pledge Agreement. All
statements contained in any Letter of Credit Application, Compliance Certificate
or Pledged Collateral Certificate delivered to any Lender or the Administrative
Agent at any time by or on behalf of the Borrower shall constitute
representations and warranties by the Borrower hereunder.

      14.7. NOTICES. Except as otherwise specifically provided for herein, any
notice, demand or communication hereunder shall be given in writing (including
facsimile transmission) and mailed or delivered by hand or overnight courier to
the parties at their respective addresses set
<PAGE>
                                      -69-

forth below, or, as to each party, at such other address as shall be designated
by such party by a prior notice to the other party in accordance with the terms
of this provision.

            (a) any notice to the Administrative Agent shall be sent as follows:
      Fleet National Bank, Mail Stop: MA DE 10010H, 100 Federal Street, Boston,
      Massachusetts 02110, Attention: Esteban Koosau, Fax: (617) 434-1096, with
      a copy to: Bingham McCutchen LLP, 150 Federal Street, Boston,
      Massachusetts 02110, Attention: Jonathan K. Bernstein, Fax: (617) 951-8736

            (b) Any notice to the Borrower shall be sent as follows: Montpelier
      Reinsurance Ltd., 8 Par-La-Ville Road, Hamilton, HM 08, Bermuda, Attn: The
      Chairman, Fax: 441-296-5551, with a copy to: LeBoeuf, Lamb, Greene &
      MacRae, L.L.P., 125 West 55th Street, New York, New York 10019, Attention:
      Michael Groll, Fax: (212) 424-8500.

            (c) if to any Lender, at such Lender's address set forth on Schedule
      1 hereto, or such other address for notice as such Lender shall have last
      furnished in writing to the Person giving the notice.

      All notices hereunder shall be effective (i) five (5) Business Days after
such notice is mailed, by registered or certified mail, postage prepaid (return
receipt requested), (ii) upon delivery by hand, (iii) upon delivery if delivered
by overnight courier (such delivery to be evidenced by the courier's records),
and (iv) in the case of any notice or communication by facsimile transmission,
on the date when sent.

      14.8. MISCELLANEOUS. This Reimbursement and Pledge Agreement and the
Pledged Collateral shall not be in any way affected by the extension of time or
renewal of any of the Obligations, the modification in any manner or the taking
or release in whole or in part of any security therefor or the obligations of
the Borrower or any endorsers, sureties, guarantors or other parties or the
granting of any other indulgences to the Borrower. No termination of this
Reimbursement and Pledge Agreement shall be effective until the Obligations of
the Borrower secured by this Reimbursement and Pledge Agreement have been
satisfied in full.

      14.9. SUCCESSORS AND ASSIGNS. This Reimbursement and Pledge Agreement
shall inure to the benefit of the Administrative Agent and the Lenders and its
and their successors and assigns and shall bind the Borrower and the successors,
representatives, legal representatives and/or heirs and assigns of the Borrower.

<PAGE>
                                      -70-

         14.10. CHOICE OF LAW/BINDING EFFECT. This Reimbursement and Pledge
Agreement and the rights and obligations of the parties hereunder shall be
construed and interpreted in accordance with the laws of the State of New York,
excluding the laws applicable to conflicts or choice of law (other than Section
5-1401 of the New York General Obligations Law). Regardless of any provision in
any other agreement, for purposes of Article 9 of the uniform commercial code as
in effect in the State of New York, New York shall be deemed to be the
Administrative Agent's and the Lenders' jurisdiction.

         14.11. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES
ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY
DISPUTE IN CONNECTION WITH THIS REIMBURSEMENT AND PLEDGE AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE
PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS OR ANY COURSE OF CONDUCT, COURSE OF
DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY,
INCLUDING ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF
ANY OF THE PARTIES HERETO RELATING TO ENFORCEMENT OF THE LOAN DOCUMENTS AND
AGREES THAT IT WILL NOT SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER
ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. Except as
prohibited by law, each of the Borrower, the Lenders and the Administrative
Agent hereby waives any right it may have to claim or recover in any litigation
referred to in the preceding sentence any special, exemplary, punitive or
consequential damages or any damages other than, or in addition to, actual
damages. The Borrower (a) certifies that no representative, agent or attorney of
any Lender or the Administrative Agent has represented, expressly or otherwise,
that such Lender or the Administrative Agent would not, in the event of
litigation, seek to enforce the foregoing waivers and (b) acknowledges that the
Administrative Agent and the Lenders have been induced to enter into this
Reimbursement and Pledge Agreement, the other Loan Documents to which it is a
party by, among other things, the waivers and certifications contained herein.

         14.12. DELIVERY OF ADDITIONAL DOCUMENTS. The Borrower agrees to execute
and deliver to the Administrative Agent and/or third parties designated by the
Administrative Agent such additional documents, notices, requests and other
instruments as the Administrative Agent deems reasonably necessary or advisable
to protect the Administrative Agent's rights under this Reimbursement and Pledge
Agreement.
<PAGE>
                                      -71-

         14.13. CONFIDENTIALITY. Each Lender agrees to maintain and to cause its
Affiliates to maintain the confidentiality of all information provided to it by
the Borrower or any Subsidiary of the Borrower, or by the Administrative Agent
on behalf of the Borrower or any Subsidiary of either of them, under this
Reimbursement and Pledge Agreement or any other Loan Document, and neither it
nor any of its Affiliates shall use any such information other than in
connection with or in enforcement of this Agreement and the other Loan Documents
or in connection with other business now or hereafter existing or contemplated
directly with the Borrower or any Subsidiary; except to the extent such
information (i) was or becomes generally available to the public other than as a
result of disclosure by the Lender or its Affiliates or in violation of any
applicable confidentiality agreement known to the Lender, or (ii) was or becomes
available on a non-confidential basis from a source other than the Borrower,
provided that such source is not bound by a confidentiality agreement with the
Borrower and/or with any restrictions on its use known to the Lender; provided,
however, that any Lender may disclose such information (A) at the request or
pursuant to any requirement of any governmental authority to which the Lender is
subject or in connection with an examination of such Lender by any such
authority; provided that the Lender makes reasonable efforts to request
confidential treatment of such information to the extent permitted by law; (B)
pursuant to subpoena or other court process; (C) as may be required (in such
Lender's reasonable judgment) in accordance with the provisions of any
applicable requirement of law; (D) to the extent reasonably required in
connection with any litigation or proceeding to which the Administrative Agent,
any Lender or their respective Affiliates may be party; (E) to the extent
reasonably required in connection with the exercise of any remedy hereunder or
under any other Loan Document; (F) to such Lender's independent auditors and
other professional advisors who agree to the confidentiality provisions hereof;
and (G) to any Participant or Assignee, actual or potential, provided that such
Person agrees in writing to keep such information confidential to the same
extent required of the Lenders hereunder. Notwithstanding anything herein to the
contrary, the Administrative Agent and each Lender may disclose to any and all
persons, without limitation of any kind, any information with respect to U.S.
federal income tax treatment and 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 the Administrative Agent or
such Lender relating to such tax treatment and tax structure.

         14.14. CONSENTS, AMENDMENTS, WAIVERS, ETC. Any consent or approval
required or permitted by this Reimbursement and Pledge Agreement to be given by
the Lenders may be given, and any term of this
<PAGE>
                                      -72-

Reimbursement and Pledge Agreement, the other Loan Documents or any other
instrument related hereto or mentioned herein may be amended, and the
performance or observance by the Borrower or any of its Subsidiaries of any
terms of this Reimbursement and Pledge Agreement, the other Loan Documents or
such other instrument or the continuance of any Default or Event of Default may
be waived (either generally or in a particular instance and either retroactively
or prospectively) with, but only with, the written consent of the Borrower and
the written consent of the Required Lenders. Notwithstanding the foregoing, no
amendment, modification or waiver shall:

                  (a) without the written consent of the Borrower and each
         Lender directly affected thereby:

                           (i) reduce or forgive the principal amount of any
                  Reimbursement Obligations, or reduce the Letter of Credit Fee,
                  the Facility Fee or interest on amounts due hereunder or under
                  the other Loan Documents (other than interest accruing
                  pursuant to Section 3.8 following the effective date of any
                  waiver by the Required Lenders of the Default or Event of
                  Default relating thereto);

                          (ii) increase the amount of such Lender's Commitment
                  or extend the expiration date of such Lender's Commitment;

                          (iii) postpone or extend the Commitment Maturity Date
                  or any other regularly scheduled dates for payments of the
                  Reimbursement Obligations or any Fees or other amounts payable
                  to such Lender (it being understood that (A) a waiver of the
                  application of the default rate of interest and (B) any vote
                  to rescind any exercise of remedies made pursuant to Section
                  11 of amounts owing with respect to the Obligations shall
                  require only the approval of the Required Lenders); and

                          (iv) other than pursuant to a transaction permitted by
                  the terms of this Reimbursement and Pledge Agreement, release
                  all or substantially all of the Pledged Collateral (excluding,
                  if the Borrower or any Subsidiary of a Borrower becomes a
                  debtor under the federal Bankruptcy Code, the release of "cash
                  collateral", as defined in Section 363(a) of the federal
                  Bankruptcy Code pursuant to a cash collateral stipulation with
                  the debtor approved by the Required Lenders);

                  (b) without the written consent of all of the Lenders, amend
         or waive this Section 14.14 or the definition of Required Lenders;
<PAGE>
                                      -73-

                  (c) without the written consent of the Administrative Agent,
         amend or waive Section 12, the amount or time of payment of any fees or
         expenses payable to the Administrative Agent or any other provision
         applicable to the Administrative Agent.

No waiver shall extend to or affect any obligation not expressly waived or
impair any right consequent thereon. No course of dealing or delay or omission
on the part of the Administrative Agent or any Lender in exercising any right
shall operate as a waiver thereof or otherwise be prejudicial thereto. No notice
to or demand upon the Borrower shall entitle the Borrower to other or further
notice or demand in similar or other circumstances.

         14.15. AGENT FOR SERVICE. The Borrower has irrevocably designated,
appointed, and empowered LeBoeuf, Lamb, Greene & MacRae, L.L.P. with an office
on the date hereof at 125 West 55th Street, New York, New York 10019 as its
designee, appointee and agent to receive and accept for and on its behalf, and
its properties, assets and revenues, service of any and all legal process,
summons, notices and documents which may be served in any action, suit or
proceedings brought against the Borrower in any United States or State of New
York court. If for any reason such designee, appointee and agent hereunder shall
cease to be available to act as such, the Borrower agrees to designate a new
designee, appointee and agent in the Borough of Manhattan, The City of New York
on the terms and for the purposes of this Section 14.15 satisfactory to the
Administrative Agent. The Borrower further hereby irrevocably consents and
agrees to the service of any and all legal process, summons, notices and
documents in any action, suit or proceeding against the Borrower by serving a
copy thereof upon the relevant agent for service of process referred to in this
Section 14.15 (whether or not the appointment of such agent shall for any reason
prove to be ineffective or such agent shall accept or acknowledge such service)
or by mailing copies thereof by registered or certified air mail, postage
prepaid, to the Borrower at its address specified in Section 14.7 hereof. The
Borrower agrees that the failure of any such designee, appointee and agent to
give any notice of such service to it shall not impair or affect in any way the
validity of such service or any judgment rendered in any action or proceeding
based thereon. Nothing herein shall in any way be deemed to limit the ability of
the Lenders or the Administrative Agent to serve any such legal process,
summons, notices and documents in any other manner permitted by applicable law
or to obtain jurisdiction over the Borrower or bring actions, suits or
proceedings against the Borrower in such other jurisdictions, and in such
manner, as may be permitted by applicable law. Each of the Borrower, the
Administrative Agent and the Lenders irrevocably and unconditionally waives, to
the fullest extent
<PAGE>
                                      -74-

permitted by law, any objection which they may now or hereafter have to the
laying of venue of any of the aforesaid actions, suits or proceedings arising
out of or in connection with this Reimbursement and Pledge Agreement or any
other Loan Document brought in the United States Federal courts located in the
Borough of Manhattan, The City of New York or the courts of the State of New
York and hereby further irrevocably and unconditionally waive and agree not to
plead or claim in any such court that any such action, suit or proceeding
brought in any such court has been brought in an inconvenient forum. The
Borrower, the Administrative Agent and the Lenders each waive personal service
of any summons, complaint or other process and irrevocably consent to the
service of process by registered mail, postage prepaid, or by any other means
permitted by New York or federal law.

         14.16. CONVERSION. If, for the purpose of obtaining judgment in any
court or obtaining an order enforcing a judgment, it becomes necessary to
convert any amount due under this Reimbursement and Pledge Agreement in Dollars
into any other currency (hereinafter in this Section 14.16 called the "second
currency"), then the conversion shall be made at the rate of exchange used by
the Administrative Agent prevailing on the Business Day preceding the day on
which the judgment is given or (as the case may be) the order is made. In the
event that there is a difference between the rate of exchange on the basis of
which the amount of such judgment or order is determined and the rate of
exchange prevailing on the date of payment, then the rate of exchange prevailing
on the date of payment shall govern the amount owing hereafter, and the Borrower
agrees to pay such amount as may be necessary to ensure that the amount paid on
such date in the second currency is the amount in such second currency which,
when converted at the rate of exchange for buying Dollars with the second
currency prevailing on the date of payment, is the amount which was due under
this Reimbursement and Pledge Agreement in Dollars before such judgment was
obtained or made. Any amount due from the Borrower to the Administrative Agent
and/or the Lenders under the second sentence of this Section 14.16 will be due
as a separate debt of the Borrower to the Administrative Agent and/or the
Lenders, shall constitute an Obligation hereunder and shall not be affected by
judgment or order being obtained for any other sum due under or in respect of
this Reimbursement and Pledge Agreement. The covenants contained in this Section
14.16 shall survive the payment in full of all of the other obligations of the
Borrower under this Reimbursement and Pledge Agreement.

         14.17. COUNTERPARTS. This Reimbursement and Pledge Agreement and any
amendment hereof may be executed in several counterparts and by each party on a
separate counterpart, each of which
<PAGE>
                                      -75-

when executed and delivered shall be an original, and all of which together
shall constitute one instrument. Delivery by facsimile by any of the parties
hereto of an executed counterpart hereof or of any amendment or waiver hereto
shall be as effective as an original executed counterpart hereof or of such
amendment or waiver and shall be considered a representation that an original
executed counterpart hereof or such amendment or waiver, as the case may be,
will be delivered.
<PAGE>
                                      -76-

         IN WITNESS WHEREOF, the undersigned have duly executed this
Reimbursement and Pledge Agreement as a sealed instrument as of the date first
set forth above.

                                    MONTPELIER REINSURANCE LTD.

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    FLEET NATIONAL BANK, individually and as
                                    Administrative Agent

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    BANK OF AMERICA

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    THE BANK OF NEW YORK

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    BANK ONE

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    BARCLAYS BANK PLC

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    CREDIT SUISSE FIRST BOSTON, CAYMAN ISLAND
                                    BRANCH

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    ING BANK N.V., LONDON BRANCH

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
                                    ROYAL BANK OF SCOTLAND PLC

                                    By: ________________________________________
                                           Name:
                                           Title:
<PAGE>
Consented and Agreed to:

FLEET NATIONAL BANK,
    as Party to the Existing Control Agreement
and the Existing Pledge Agreement

By:_______________________________________________
      Name:
      Title:
       Date:
<PAGE>
                                   Schedule 8
                               Financial Covenants

         8.1. LEVERAGE RATIO. The Parent will not permit the Leverage Ratio
to be more than thirty percent (30%).

         8.2. A.M. BEST RATING. The Borrower will not permit its A.M. Best
Rating to fall below the rating of "B++".

         Capitalized terms used in this Schedule 8 and not defined in the
Reimbursement and Pledge Agreement shall have the meanings ascribed to them
below.

         Borrower Reinsurance Agreement. Any arrangement whereby the Borrower or
any other Insurance Subsidiary, as reinsurer, agrees to indemnify any other
insurance or reinsurance company against all or a portion of the insurance or
reinsurance risks underwritten by such insurance or reinsurance company under
any insurance or reinsurance policy.

         Capital Lease Obligation. As to any Person, the obligations of such
Person to pay rent or other amounts under any lease which is required to be
classified and accounted for as a capital lease on a balance sheet of such
Person in accordance with GAAP. For purposes of this Reimbursement and Pledge
Agreement, the amount of such Capital Lease Obligation shall be the capitalized
amount thereof determined in accordance with GAAP.

         Consolidated Debt. The consolidated Debt (excluding Hedging
Obligations) of the Parent and its Subsidiaries.

         Consolidated Net Worth. The Net Worth of the Parent and its
Subsidiaries on a consolidated basis.

         Contingent Liability. Any agreement, undertaking or arrangement by
which any Person (outside the ordinary course of business) guarantees, endorses,
acts as surety for or otherwise becomes or is contingently liable for (by direct
or indirect agreement, contingent or otherwise, to provide funds for payment by,
to supply funds to, or otherwise to invest in, a debtor, or otherwise to assure
a creditor against loss) the Debt, obligation or other liability of any other
Person (other than by endorsements of instruments in the course of collection),
or for the payment of dividends or other distribution upon the shares of any
other Person or undertakes or agrees (contingently or otherwise) to purchase,
repurchase, or otherwise acquire or become responsible for any Debt, obligation
or liability or any security therefore, or to provide funds for the
<PAGE>
                                      -2-

payment or discharge thereof (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise) or to maintain solvency, assets,
level of income, or other financial condition of any other Person, or to make
payment or transfer property to any other Person other than for fair value
received; provided, however, that obligations of each of the Borrower and the
Insurance Subsidiaries under Primary Policies or Borrower Reinsurance Agreements
which are entered into in the ordinary course of business (including security
posted by the Borrower and each of the Insurance Subsidiaries in the ordinary
course of its business to secure obligations thereunder) shall not be deemed to
be Contingent Liabilities of such Insurance Subsidiary or the Borrower for the
purposes of this Agreement. The amount of any Person's obligation under any
Contingent Liability shall (subject to any limitation set forth therein) be
deemed to be the lesser of (i) the outstanding principal amount (or maximum
permitted principal amount, if larger) of the Debt, obligation or other
liability guaranteed or supported thereby or (ii) the maximum stated amount so
guaranteed or supported.

         Debt. With respect to any Person, at any date, without duplication, (a)
all obligations of such Person for borrowed money or in respect of loans or
advances; (b) all obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments; (c) all obligations in respect of letters of
credit which have been drawn but not reimbursed by the Person for whose account
such letter of credit was issued within the later of (x) three (3) Business Days
and (y) the applicable cure period and bankers' acceptances issued for the
account of such Person; (d) all Capital Lease Obligations of such Person; (e)
all Hedging Obligations of such Person; (f) to the extent required to be
included as liabilities in accordance with GAAP, all obligations of such Person
to pay the deferred purchase price of property or services; (g) Debt of such
Person secured by a Lien on property owned or being purchased by such Person
(including Debt arising under conditional sales or other title retention
agreements) whether or not such Debt is limited in recourse; (h) any Debt of
another Person secured by a Lien on any assets of such first Person, whether or
not such Debt is assumed by such first Person (it being understood that if such
Person has not assumed or otherwise become personally liable for any such Debt,
the amount of the Debt of such Person in connection therewith shall be limited
to the lesser of the face amount of such Debt and the fair market value of all
property of such Person securing such Debt); (i) any Debt of a partnership in
which such Person is a general partner unless such debt is nonrecourse to such
Person; and (j) all Contingent Liabilities of such Person whether or not in
connection with the foregoing; provided that, notwithstanding anything to
contrary contained herein, Debt shall not include (x) unsecured current
liabilities incurred in the ordinary course of business
<PAGE>
                                      -3-

and paid within ninety (90) days after the due date (unless contested diligently
in good faith by appropriate proceedings and, if requested by the Administrative
Agent, reserved against in conformity with GAAP) other than liabilities that are
for money borrowed or are evidenced by bonds, debentures, notes or other similar
instruments or (y) any obligations of such Person under any Borrower Reinsurance
Agreement or any Primary Policy.

         Hedging Obligations. With respect to any Person, the liability of such
Person under any futures contract or options contract, interest rate swap
agreements and interest rate collar agreements and all other agreements or
arrangements (other than Retrocession Agreements), designed to protect such
Person against fluctuations in interest rates or currency exchange rates. Debt
under a Hedging Obligation shall be the amount of such Person's net obligation,
if any, under each Hedging agreement (determined on the mark-to-market value for
such agreement based upon a readily available quotation provided by a recognized
dealer in such type of Hedging agreement).

         Leverage Ratio. The ratio, expressed as a percentage, of (a)
Consolidated Debt to (b) the sum of Tangible Net Worth plus Consolidated Debt.

         Lien. When used with respect to any Person, any interest in any real or
personal property, asset or other right held, owned or being purchased or
acquired by such Person for its own use, consumption or enjoyment which secures
payment or performance of any obligation and shall include any mortgage, lien,
pledge, encumbrance, charge, retained title of a conditional vendor or lessor,
or other security agreement, mortgage, deed of trust, chattel mortgage,
assignment, pledge, retention of title, financing or similar statement or
notice, or other encumbrance arising as a matter of law, judicial process or
otherwise.

         Net Worth. With respect to any Person, the consolidated net worth of
such Person calculated in accordance with GAAP.

         Primary Policies. Any insurance policies issued by the Borrower or any
other Insurance Subsidiary.

         Retrocession Agreements. Any agreement, treaty, certificate or other
arrangement whereby the Borrower or any other Insurance Subsidiary cedes to
another insurer all or part of the Borrower's or such Insurance Subsidiary's
liability under a policy or policies of insurance reinsured by the Borrower or
such Insurance Subsidiary.
<PAGE>
                                      -4-

         Tangible Net Worth. As to the Borrower, Consolidated Net Worth minus
intangible assets minus capitalized expenses.<PAGE>

                                                                     EXHIBIT 4.1

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

                              THE CHUBB CORPORATION

                                       and

                          BANK ONE TRUST COMPANY, N.A.,

                           as Purchase Contract Agent

                           PURCHASE CONTRACT AGREEMENT

                            Dated as of June 24, 2003

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

<PAGE>

<TABLE>
<S>                                                                                                                 <C>
ARTICLE 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
         SECTION 1.01.  Definitions..............................................................................    1
         SECTION 1.02.  Compliance Certificates and Opinions.....................................................   15
         SECTION 1.03.  Form of Documents Delivered to Purchase Contract Agent...................................   16
         SECTION 1.04.  Acts of Holders; Record Dates............................................................   16
         SECTION 1.05.  Notices..................................................................................   17
         SECTION 1.06.  Notice to Holders; Waiver................................................................   17
         SECTION 1.07.  Effect of Headings and Table of Contents.................................................   19
         SECTION 1.08.  Successors and Assigns...................................................................   19
         SECTION 1.09.  Separability Clause......................................................................   19
         SECTION 1.10.  Benefits of Agreement....................................................................   19
         SECTION 1.11.  Governing Law............................................................................   19
         SECTION 1.12.  Legal Holidays...........................................................................   20
         SECTION 1.13.  Counterparts.............................................................................   20
         SECTION 1.14.  Inspection of Agreement..................................................................   20
         SECTION 1.15.  Appointment of Financial Institution as Agent for the Company............................   20
         SECTION 1.16.  No Waiver................................................................................   20

ARTICLE 2 CERTIFICATE FORMS
         SECTION 2.01.  Forms of Certificates Generally..........................................................   21
         SECTION 2.02.  Form of Purchase Contract Agent's Certificate of Authentication..........................   22

ARTICLE 3 THE UNITS
         SECTION 3.01.  Amount; Form and Denominations...........................................................   22
         SECTION 3.02.  Rights and Obligations Evidenced by the Certificates.....................................   22
         SECTION 3.03.  Execution, Authentication, Delivery and Dating...........................................   23
         SECTION 3.04.  Temporary Certificates...................................................................   24
         SECTION 3.05.  Registration; Registration of Transfer and Exchange......................................   24
         SECTION 3.06.  Book-Entry Interests.....................................................................   26
         SECTION 3.07.  Notices to Holders.......................................................................   27
         SECTION 3.08.  Appointment of Successor Depositary......................................................   27
         SECTION 3.09.  Definitive Certificates..................................................................   27
         SECTION 3.10.  Mutilated, Destroyed, Lost and Stolen Certificates.......................................   27
         SECTION 3.11.  Persons Deemed Owners....................................................................   29
         SECTION 3.12.  Cancellation.............................................................................   29
         SECTION 3.13.  Creation of Treasury Units by Substitution of Treasury Securities........................   30
         SECTION 3.14.  Recreation of Corporate Units............................................................   32
         SECTION 3.15.  Transfer of Collateral upon Occurrence of Termination Event..............................   33
         SECTION 3.16.  No Consent to Assumption.................................................................   34

ARTICLE 4 THE SENIOR NOTES AND APPLICABLE OWNERSHIP INTERESTS IN THE TREASURY PORTFOLIO
         SECTION 4.01.  Interest Payments; Rights to Interest Payments Preserved.................................   34
</TABLE>

                                        i

<PAGE>

<TABLE>
<S>                                                                                                                 <C>
         SECTION 4.02.  Notice and Voting........................................................................   35
         SECTION 4.03.  Special Event Redemption.................................................................   36

ARTICLE 5 THE PURCHASE CONTRACTS
         SECTION 5.01.  Purchase of Shares of Common Stock.......................................................   37
         SECTION 5.02.  Remarketing; Payment of Stated Amount....................................................   39
         SECTION 5.03.  Issuance of Shares of Common Stock.......................................................   50
         SECTION 5.04.  Adjustment of Settlement Rate............................................................   51
         SECTION 5.05.  Notice of Adjustments and Certain Other Events...........................................   60
         SECTION 5.06.  Termination Event; Notice................................................................   60
         SECTION 5.07.  Early Settlement.........................................................................   61
         SECTION 5.08.  Intentionally Omitted....................................................................   63
         SECTION 5.09.  No Fractional Shares.....................................................................   63
         SECTION 5.10.  Charges and Taxes........................................................................   64
         SECTION 5.11.  Contract Adjustment Payments.............................................................   64
         SECTION 5.12.  Deferral of Contract Adjustment Payments.................................................   69

ARTICLE 6 REMEDIES
         SECTION 6.01.  Unconditional Right of Holders to Receive Contract Adjustment Payments
               and to Purchase Shares of Common Stock............................................................   70
         SECTION 6.02.  Restoration of Rights and Remedies.......................................................   71
         SECTION 6.03.  Rights and Remedies Cumulative...........................................................   71
         SECTION 6.04.  Delay or Omission Not Waiver.............................................................   71
         SECTION 6.05.  Undertaking for Costs....................................................................   71
         SECTION 6.06.  Waiver of Stay or Extension Laws.........................................................   72

ARTICLE 7 THE PURCHASE CONTRACT AGENT
         SECTION 7.01.  Certain Duties and Responsibilities......................................................   72
         SECTION 7.02.  Notice of Default........................................................................   73
         SECTION 7.03.  Certain Rights of Purchase Contract Agent................................................   73
         SECTION 7.04.  Not Responsible for Recitals or Issuance of Units........................................   75
         SECTION 7.05.  May Hold Units...........................................................................   75
         SECTION 7.06.  Money Held in Custody....................................................................   75
         SECTION 7.07.  Compensation and Reimbursement...........................................................   75
         SECTION 7.08.  Corporate Purchase Contract Agent Required;   Eligibility................................   76
         SECTION 7.09.  Resignation and Removal; Appointment of Successor........................................   76
         SECTION 7.10.  Acceptance of Appointment by Successor...................................................   78
         SECTION 7.11.  Merger, Conversion, Consolidation or Succession to Business..............................   78
         SECTION 7.12.  Preservation of Information; Communications to Holders...................................   79
         SECTION 7.13.  No Obligations of Purchase Contract Agent................................................   79
         SECTION 7.14.  Tax Compliance...........................................................................   79

ARTICLE 8 SUPPLEMENTAL AGREEMENTS
         SECTION 8.01.  Supplemental Agreements Without Consent of Holders.......................................   80
         SECTION 8.02.  Supplemental Agreements with Consent of Holders..........................................   81
</TABLE>

                                       ii

<PAGE>

<TABLE>
<S>                                                                                                                 <C>
         SECTION 8.03.  Execution of Supplemental Agreements.....................................................   82
         SECTION 8.04.  Effect of Supplemental Agreements........................................................   82
         SECTION 8.05.  Reference to Supplemental Agreements.....................................................   82

ARTICLE 9 CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
         SECTION 9.01.  Covenant Not to Consolidate, Merge, Convey, Transfer or Lease Property
               Except under Certain Conditions...................................................................   82
         SECTION 9.02.  Rights and Duties of Successor Corporation...............................................   83
         SECTION 9.03.  Officers' Certificate and Opinion of Counsel Given to Purchase Contract
               Agent.............................................................................................   84

ARTICLE 10 COVENANTS
         SECTION 10.01. Performance under Purchase Contracts.....................................................   84
         SECTION 10.02. Maintenance of Office or Agency..........................................................   84
         SECTION 10.03. Company to Reserve Common Stock..........................................................   85
         SECTION 10.04. Covenants as to Common Stock.............................................................   85
         SECTION 10.05. Statements of Officers of the Company as to Default......................................   85
         SECTION 10.06. Tax Treatment............................................................................   85
</TABLE>

                                       iii

<PAGE>

EXHIBITS

Exhibit A - Form of Corporate Units Certificate

Exhibit B - Form of Treasury Units Certificate For Treasury Units Containing
              Treasury Securities Maturing on July 15, 2006

Exhibit C - Form of Treasury Units Certificate For Treasury Units Containing
              Treasury Securities Maturing on August 15, 2006

Exhibit D - Instruction to Purchase Contract Agent

Exhibit E - Notice from Purchase Contract Agent to Holders

Exhibit F - Notice to Settle by Separate Cash

Exhibit G - Notice from Purchase Contract Agent to Collateral Agent

Exhibit H - Form of Remarketing Agreement

                                       iv

<PAGE>

         PURCHASE CONTRACT AGREEMENT, dated as of June 24, 2003, between THE
CHUBB CORPORATION, a New Jersey corporation (the "COMPANY"), and BANK ONE TRUST
COMPANY, N.A., a national banking association, acting as purchase contract agent
for the Holders of Units (as defined herein) from time to time (the "PURCHASE
CONTRACT AGENT").

                                    RECITALS

         The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Units.

         All things necessary to make the Purchase Contracts (as defined
herein), when the Certificates (as defined herein) are executed by the Company
and authenticated, executed on behalf of the Holders and delivered by the
Purchase Contract Agent, as provided in this Agreement, the valid obligations of
the Company, and to constitute these presents a valid agreement of the Company,
in accordance with its terms, have been done. For and in consideration of the
premises and the purchase of the Units by the Holders thereof, it is mutually
agreed as follows:

                                   ARTICLE 1

             DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

         SECTION 1.01. Definitions.

         For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:

         (a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular, and nouns
and pronouns of the masculine gender include the feminine and neuter genders;

         (b) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States;

         (c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision; and

         (d) the following terms have the meanings given to them in this Section
1.01(d):

         "ACCOUNTING EVENT" means the receipt at any time prior to the earlier
of the date of any Successful Remarketing and the Purchase Contract Settlement
Date by the audit committee of the Board of Directors of a written report in
accordance with Statement on Auditing Standards ("SAS") No. 97, "Amendment to
SAS No. 50-Reports on the Application of Accounting

<PAGE>

Principles," from the Company's independent auditors, provided at the request of
the management of the Company, to the effect that, as a result of a change in
accounting rules after the date of original issuance of the Senior Notes, the
Company must either (a) account for the Purchase Contracts as derivatives under
SFAS 133 (or any successor accounting standard) or (b) account for the Units
using the if-converted method under SFAS 128 (or any successor accounting
standard), and that, in either case, such accounting treatment will cease to
apply upon redemption of the Senior Notes.

         "ACT" has the meaning, with respect to any Holder, set forth in Section
1.04.

         "ADJUSTED APPLICABLE MARKET VALUE" has the meaning set forth in Section
5.01.

         "AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

         "AGREEMENT" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.

         "APPLICABLE MARKET VALUE" has the meaning set forth in Section 5.01.

         "APPLICABLE OWNERSHIP INTEREST" shall mean, with respect to a Corporate
Unit and the Treasury Portfolio represented by such Corporate Unit, (i) a 2.5%
undivided beneficial ownership interest in $1,000 face amount of U.S. treasury
securities (or principal or interest strips thereof) included in such Treasury
Portfolio that mature on or prior to August 15, 2006, and (ii) (x) for the
scheduled Payment Date on the Senior Notes that occurs on the Purchase Contract
Settlement Date, in the case of a Successful Remarketing prior to the Final
Remarketing Date, or (y) for each scheduled Payment Date on the Senior Notes
that occurs after the Special Event Redemption Date to and including the
Purchase Contract Settlement Date, in the case of a Special Event Redemption, a
0.0140625 % undivided beneficial ownership interest in $1,000 face amount of
U.S. treasury securities (or principal or interest strips thereof) included in
such Treasury Portfolio that mature on or prior to the business day immediately
preceding such scheduled Payment Date.

         "APPLICABLE PRINCIPAL AMOUNT" means the aggregate principal amount of
the Senior Notes that are represented by Corporate Units.

         "APPLICANTS" has the meaning set forth in Section 7.12(b).

         "BANKRUPTCY CODE" means title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform system
of bankruptcy laws.

                                       2

<PAGE>

         "BENEFICIAL OWNER" means, with respect to a Book-Entry Interest, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Depositary or on the books of a Person maintaining an account
with such Depositary (directly as a Depositary Participant or as an indirect
participant, in each case in accordance with the rules of such Depositary).

         "BOARD OF DIRECTORS" means the board of directors of the Company or a
duly authorized committee of that board.

         "BOARD RESOLUTION" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification and delivered
to the Purchase Contract Agent.

         "BOOK-ENTRY INTEREST" means a beneficial interest in a Global
Certificate, registered in the name of a Depositary or a nominee thereof,
ownership and transfers of which shall be maintained and made through book
entries by such Depositary as described in Section 3.06.

         "BUSINESS DAY" or "business day" means any day other than a Saturday or
Sunday or any other day on which banking institutions and trust companies in New
York City, New York are permitted or required by applicable law to remain closed
or a day on which the Indenture Trustee or the Collateral Agent is closed for
business; provided that for purposes of the second paragraph of Section 1.12
only, the term "Business Day" shall also be deemed to exclude any day on which
DTC is closed.

         "CASH MERGER" has the meaning set forth in Section 5.04(b)(2).

         "CASH MERGER EARLY SETTLEMENT" has the meaning set forth in Section
5.04(b)(2).

         "CASH MERGER EARLY SETTLEMENT DATE" has the meaning set forth in
Section 5.04(b)(2).

         "CASH SETTLEMENT" has the meaning set forth in Section 5.02(c)(i).

         "CERTIFICATE" means a Corporate Units Certificate or a Treasury Units
Certificate.

         "CLOSING PRICE" has the meaning set forth in Section 5.01(a).

         "CODE" means the Internal Revenue Code of 1986, as amended.

         "COLLATERAL" has the meaning set forth in Section 1.01(d) of the Pledge
Agreement.

         "COLLATERAL ACCOUNT" has the meaning set forth in Section 1.01(d) of
the Pledge Agreement.

         "COLLATERAL AGENT" means BNY Midwest Trust Company, an Illinois trust
company, as Collateral Agent under the Pledge Agreement until a successor
Collateral Agent shall have

                                       3

<PAGE>

become such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Collateral Agent" shall mean the Person who is then the Collateral
Agent thereunder.

         "COLLATERAL SUBSTITUTION" means (i) with respect to a Corporate Unit in
connection with the creation of a Treasury Unit from such Corporate Unit, (x)
the substitution for the Pledged Senior Note represented by such Corporate Unit
by Treasury Securities in accordance with Section 3.13, or (y) the substitution
for the Pledged Applicable Ownership Interest in the Treasury Portfolio
represented by such Corporate Unit by Treasury Securities in accordance with
Section 3.13, or (ii) with respect to a Treasury Unit in connection with the
recreation of a Corporate Unit from such Treasury Unit, (x) the substitution for
the Pledged Treasury Securities represented by such Treasury Unit (if the
Applicable Ownership Interest in the Treasury Portfolio has not replaced the
Senior Note represented by the Corporate Unit) by Senior Notes in accordance
with Section 3.14, or (y) the substitution for the Pledged Treasury Securities
represented by such Treasury Unit (if the Applicable Ownership Interest in the
Treasury Portfolio has replaced the Senior Note represented by the Corporate
Unit) by the appropriate Applicable Ownership Interest in the Treasury Portfolio
in accordance with Section 3.14.

         "COMMON STOCK" means the common stock, par value $1.00 per share, of
the Company.

         "COMPANY" means the Person named as the "COMPANY" in the first
paragraph of this instrument until a successor shall have become such pursuant
to the applicable provision of this Agreement, and thereafter "COMPANY" shall
mean such successor.

         "CONSTITUENT PERSON" has the meaning set forth in Section 5.04(b).

         "CONTRACT ADJUSTMENT PAYMENTS" means the payments payable by the
Company on the Payment Dates in respect of each Purchase Contract, at a rate per
year of 4.75% of the Stated Amount per Purchase Contract.

         "CORPORATE TRUST OFFICE" means the office of the Purchase Contract
Agent at which, at any particular time, its corporate trust business shall be
principally administered, which office at the date hereof is located at 153 West
51st Street, New York, New York, 10019 (Fax: (212) 373-1383).

         "CORPORATE UNIT" means the collective rights and obligations of a
Holder of a Corporate Units Certificate in respect of (i) the Purchase Contracts
represented thereby and (ii) the Senior Notes (or the appropriate Applicable
Ownership Interest in the Treasury Portfolio, as the case may be) (subject in
each case (except for the appropriate Applicable Ownership Interest specified in
clause (ii) of the definition of such term) to the Pledge thereof) represented
thereby.

         "CORPORATE UNITS CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Corporate Units
specified on such certificate.

         "COUPON RATE" means the percentage rate per annum at which each Senior
Note will bear interest initially.

                                       4

<PAGE>

         "CURRENT MARKET PRICE" has the meaning set forth in Section 5.04(a)(8).

         "CUSTODIAL AGENT" means BNY Midwest Trust Company, an Illinois trust
company, as Custodial Agent under the Pledge Agreement until a successor
Custodial Agent shall have become such pursuant to the applicable provisions of
the Pledge Agreement, and thereafter "CUSTODIAL AGENT" shall mean the Person who
is then the Custodial Agent thereunder.

         "DEFERRED CONTRACT ADJUSTMENT PAYMENTS" has the meaning provided in
Section 5.12.

         "DEPOSITARY" means a clearing agency registered under Section 17A of
the Exchange Act that is designated to act as Depositary for the Units as
contemplated by Sections 3.06 and 3.08.

         "DEPOSITARY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book entry transfers and pledges of securities deposited with the Depositary.

         "DTC" means The Depository Trust Company.

         "EARLY SETTLEMENT" has the meaning set forth in Section 5.07.

         "EARLY SETTLEMENT AMOUNT" has the meaning set forth in Section 5.07.

         "EARLY SETTLEMENT DATE" has the meaning set forth in Section 5.07.

         "EARLY SETTLEMENT RATE" has the meaning set forth in Section 5.07.

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

         "EXCHANGE ACT" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.

         "EXCHANGE PROPERTY" has the meaning set forth in Section 5.04(b).

         "EXPIRATION DATE" has the meaning set forth in Section 1.04(e).

         "EXPIRATION TIME" has the meaning set forth in Section 5.04(a)(6).

         "FAILED FINAL REMARKETING" has the meaning set forth in Section
5.02(d).

         "FAILED INITIAL REMARKETING" has the meaning set forth in Section
5.02(a).

         "FAILED REMARKETING" shall mean any of (i) a Failed Initial
Remarketing, (ii) a Failed Second Remarketing, (iii) a Failed Third Remarketing
or (iv) a Failed Final Remarketing.

         "FAILED SECOND REMARKETING" has the meaning set forth in Section
5.02(b).

                                       5

<PAGE>

         "FAILED THIRD REMARKETING" has the meaning set forth in Section
5.02(b).

         "FINAL REMARKETING" has the meaning set forth in Section 5.02(d).

         "FINAL REMARKETING DATE" means the third Business Day immediately
preceding the Purchase Contract Settlement Date.

         "FINAL REMARKETING FEE" has the meaning set forth in Section 5.02(d).

         "GLOBAL CERTIFICATE" means a Certificate that evidences all or part of
the Units and is registered in the name of the Depositary or a nominee thereof.

         "HOLDER" means, with respect to a Unit, the Person in whose name the
Unit evidenced by a Certificate is registered in the Security Register;
provided, however, that solely for the purpose of determining whether the
Holders of the requisite number of Units have voted on any matter (and not for
any other purpose hereunder), if the Unit remains in the form of one or more
Global Certificates and if the Depositary that is the registered holder of such
Global Certificate has sent an omnibus proxy assigning voting rights to the
Depositary Participants to whose accounts the Units are credited on the record
date, the term "HOLDER" shall mean each such Depositary Participant acting at
the direction of the Beneficial Owners holding through such Depositary
Participant.

         "INDEBTEDNESS" means indebtedness of any kind of the Company.

         "INDENTURE" means the Indenture, dated as of October 25, 1989, between
the Company and the Indenture Trustee (including any provisions of the TIA that
are deemed incorporated therein), pursuant to which the Senior Notes will be
issued.

         "INDENTURE TRUSTEE" means Bank One Trust Company, N.A. (successor in
interest to The First National Bank of Chicago), as trustee under the Indenture,
or any successor thereto.

         "INITIAL REMARKETING" has the meaning set forth in Section 5.02(a).

         "INITIAL REMARKETING DATE" means the third Business Day immediately
preceding May 16, 2006.

         "ISSUER ORDER" or "ISSUER REQUEST" means a written order or request
signed in the name of the Company by (i) either its Chief Executive Officer, its
President or one of its Vice Presidents, and (ii) either its Corporate Secretary
or one of its Assistant Corporate Secretaries or its Treasurer or one of its
Assistant Treasurers, and delivered to the Purchase Contract Agent.

         "NON-ELECTING SHARE" has the meaning set forth in Section 5.04(b).

         "NYSE" has the meaning set forth in Section 5.01.

         "OFFICERS' CERTIFICATE" means a certificate signed by (i) either the
Company's Chief Executive Officer, its President or one of its Vice Presidents,
and (ii) either the Company's

                                       6

<PAGE>

Corporate Secretary or one of its Assistant Corporate Secretaries or its
Treasurer or one of its Assistant Treasurers, and delivered to the Purchase
Contract Agent. Any Officers' Certificate delivered with respect to compliance
with a condition or covenant provided for in this Agreement (other than the
Officers' Certificate provided for in Section 10.05) shall include:

                  (i) a statement that each officer signing the Officers'
         Certificate has read the covenant or condition and the definitions
         relating thereto;

                  (ii) a brief statement of the nature and scope of the
         examination or investigation undertaken by each officer in rendering
         the Officers' Certificate;

                  (iii) a statement that, in the opinion of each such officer,
         each such officer has made such examination or investigation as is
         necessary to enable such officer to express an informed opinion as to
         whether or not such covenant or condition has been complied with; and

                  (iv) a statement as to whether, in the opinion of each such
         officer, such condition or covenant has been complied with.

         "OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel to the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Purchase Contract Agent. An opinion of
counsel may rely on certificates as to matters of fact.

         "OUTSTANDING UNITS" means, with respect to any Unit and as of the date
of determination, all Units evidenced by Certificates theretofore authenticated,
executed and delivered under this Agreement, except:

                  (i) if a Termination Event has occurred, (x) Corporate Units
         representing Senior Notes or Applicable Ownership Interests in the
         Treasury Portfolio that have been theretofore deposited with the
         Purchase Contract Agent in trust for the Holders of such Corporate
         Units and (y) Treasury Units;

                  (ii) Units evidenced by Certificates theretofore cancelled by
         the Purchase Contract Agent or delivered to the Purchase Contract Agent
         for cancellation or deemed cancelled pursuant to the provisions of this
         Agreement; and

                  (iii) Units evidenced by Certificates in exchange for or in
         lieu of which other Certificates have been authenticated, executed on
         behalf of the Holder and delivered pursuant to this Agreement, other
         than any such Certificate in respect of which there shall have been
         presented to the Purchase Contract Agent proof satisfactory to it that
         such Certificate is held by a protected purchaser in whose hands the
         Units evidenced by such Certificate are valid obligations of the
         Company;

                                       7

<PAGE>

provided, however, that in determining whether the Holders of the requisite
number of the Units have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Units owned by the Company or any Affiliate
of the Company shall be disregarded and deemed not to be Outstanding Units,
except that, in determining whether the Purchase Contract Agent shall be
authorized and protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Units that a
Responsible Officer of the Purchase Contract Agent actually knows to be so owned
shall be so disregarded. Units so owned that have been pledged in good faith may
be regarded as Outstanding Units if the pledgee establishes to the satisfaction
of the Purchase Contract Agent the pledgee's right so to act with respect to
such Units and that the pledgee is not the Company or any Affiliate of the
Company.

         "PAYMENT DATE" means each February 16, May 16, August 16 and November
16 of each year, commencing August 16, 2003.

         "PERMITTED INVESTMENTS" has the meaning set forth in Section 1.01(d) of
the Pledge Agreement.

         "PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other entity of whatever nature.

         "PLAN" means an employee benefit plan that is subject to ERISA, a plan
or individual retirement account that is subject to Section 4975 of the Code or
any entity whose assets are considered assets of any such plan.

         "PLEDGE" means the pledge under the Pledge Agreement of the Senior
Notes, the Treasury Securities or the appropriate Applicable Ownership Interest
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, in each case represented by the Units (it being
understood that the appropriate Applicable Ownership Interest (as specified in
clause (ii) of the definition of such term) in the Treasury Portfolio shall not
be subject to the Pledge).

         "PLEDGE AGREEMENT" means the Pledge Agreement, dated as of June 24,
2003, among the Company, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the Purchase Contract Agent, on its own behalf and
as attorney-in-fact for the Holders from time to time of the Units, as amended
from time to time.

         "PLEDGED APPLICABLE OWNERSHIP INTERESTS" has the meaning set forth in
Section 1.01(d) of the Pledge Agreement.

         "PLEDGED SENIOR NOTES" has the meaning set forth in Section 1.01(d) of
the Pledge Agreement.

         "PLEDGED TREASURY SECURITIES" has the meaning set forth in Section
1.01(d) of the Pledge Agreement.

                                       8

<PAGE>

         "PREDECESSOR CERTIFICATE" means a Predecessor Corporate Units
Certificate or a Predecessor Treasury Units Certificate.

         "PREDECESSOR CORPORATE UNITS CERTIFICATE" of any particular Corporate
Units Certificate means every previous Corporate Units Certificate evidencing
all or a portion of the rights and obligations of the Company and the Holder
under the Corporate Units evidenced thereby; and, for the purposes of this
definition, any Corporate Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Corporate Units Certificate shall be deemed to evidence the same rights
and obligations of the Company and the Holder as the mutilated, destroyed, lost
or stolen Corporate Units Certificate.

         "PREDECESSOR TREASURY UNITS CERTIFICATE" of any particular Treasury
Units Certificate means every previous Treasury Units Certificate evidencing all
or a portion of the rights and obligations of the Company and the Holder under
the Treasury Units evidenced thereby; and, for the purposes of this definition,
any Treasury Units Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Treasury Units
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Treasury
Units Certificate.

         "PRICING COMMITTEE RESOLUTIONS" means the resolutions of the Pricing
Committee of the Company's Board of Directors dated as of June 18, 2003.

         "PRIMARY TREASURY DEALER" shall mean a primary U.S. government
securities dealer.

         "PROCEEDS" has the meaning set forth in Section 1.01(d) of the Pledge
Agreement.

         "PRO RATA" shall mean pro rata to each Holder according to the
aggregate Stated Amount of the Units held by such Holder in relation to the
aggregate Stated Amount of all Units outstanding.

         "PROSPECTUS" means the prospectus relating to the delivery of shares of
any securities in connection with an Early Settlement pursuant to Section 5.07
or a Cash Merger Early Settlement of Purchase Contracts pursuant to Section
5.04(b)(2), in the form in which first filed, or transmitted for filing, with
the Securities and Exchange Commission after the effective date of the
Registration Statement pursuant to Rule 424(b) under the Securities Act,
including the documents incorporated by reference therein as of the date of such
Prospectus.

         "PURCHASE CONTRACT" means, with respect to any Unit, the purchase
contract represented by such Unit and obligating the Company (i) to sell,
against the Holder's payment of the Stated Amount, shares of Common Stock and
(ii) to pay the Holder thereof Contract Adjustment Payments, in each case on the
terms and subject to the conditions set forth in Article Five hereof.

         "PURCHASE CONTRACT AGENT" means the Person named as the "PURCHASE
CONTRACT AGENT" in the first paragraph of this Agreement until a successor
Purchase Contract Agent shall have become such pursuant to the applicable
provisions of this Agreement, and thereafter

                                       9

<PAGE>

"PURCHASE CONTRACT AGENT" shall mean such Person or any subsequent successor who
is appointed pursuant to this Agreement.

         "PURCHASE CONTRACT SETTLEMENT DATE" means August 16, 2006.

         "PURCHASE CONTRACT SETTLEMENT FUND" has the meaning set forth in
Section 5.03.

         "PURCHASED SHARES" has the meaning set forth in Section 5.04(a)(6).

         "QUOTATION AGENT" means any Primary Treasury Dealer selected by the
Company.

         "RECORD DATE" for any distribution or Contract Adjustment Payment
payable on any Payment Date means, as to any Global Certificate or any other
Certificate, the first business day of the calendar month in which the relevant
Payment Date falls; provided that the Company may, at its option, select any
other day as the Record Date for any Payment Date so long as such Record Date
selected is more than one Business Day but less than sixty Business Days prior
to such Payment Date.

         "REDEMPTION AMOUNT" means, for each Senior Note, an amount equal to the
product of the principal amount of that Senior Note and a fraction, the
numerator of which is the Treasury Portfolio Purchase Price and the denominator
of which is the Applicable Principal Amount.

         "REDEMPTION PRICE" means, for each Senior Note, the Redemption Amount
plus any accrued and unpaid interest on such Senior Note to but excluding the
Special Event Redemption Date.

         "REFERENCE DEALER" means a dealer engaged in trading of convertible
securities.

         "REFERENCE PRICE" has the meaning set forth in Section 5.01.

         "REGISTRATION STATEMENT" means a registration statement under the
Securities Act prepared by the Company covering, inter alia, the delivery by the
Company of any securities in connection with an Early Settlement on the Early
Settlement Date or a Cash Merger Early Settlement of Purchase Contracts on the
Cash Merger Early Settlement Date under Section 5.04(b)(2), including all
exhibits thereto and the documents incorporated by reference in the prospectus
contained in such registration statement, and any post-effective amendments
thereto.

         "REMARKETED SENIOR NOTES" means, as of the applicable Remarketing Date,
the Senior Notes that are represented by Corporate Units, and each Separate
Senior Note for which the Holder has elected to have such Separate Senior Note
included in the applicable Remarketing.

         "REMARKETING" means the remarketing of the Senior Notes by the
Remarketing Agent pursuant to the Remarketing Agreement.

         "REMARKETING AGENT" means the remarketing agent specified pursuant to
the Remarketing Agreement.

                                       10

<PAGE>

         "REMARKETING AGREEMENT" means the Remarketing Agreement substantially
in the form of Exhibit H hereto to be entered into prior to the Initial
Remarketing Date among the Company, Citigroup Global Markets Inc., Goldman,
Sachs & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated and the Purchase
Contract Agent, as amended from time to time.

         "REMARKETING DATE" means any of (i) the Initial Remarketing Date, (ii)
the Second Remarketing Date, (iii) the Third Remarketing Date and (iv) the Final
Remarketing Date.

         "REMARKETING FEE" has the meaning set forth in Section 5.02(a).

         "REMARKETING PER SENIOR NOTE PRICE" means the Treasury Portfolio
Purchase Price divided by the number of Senior Notes represented by Corporate
Units and remarketed in the Initial Remarketing, the Second Remarketing or the
Third Remarketing, as the case may be.

         "REORGANIZATION EVENT" has the meaning set forth in Section 5.04(b).

         "RESET RATE" means (i) in the case of a Successful Remarketing prior to
the Final Remarketing Date, the interest rate per annum on the Senior Notes
determined by the Remarketing Agent as necessary to remarket the Remarketed
Senior Notes at a price per Remarketed Senior Note such that the aggregate price
for the Remarketed Senior Notes is equal to approximately (but not less than)
100.50% of the sum of the Treasury Portfolio Purchase Price and Separate Senior
Notes Purchase Price, and (ii) in the case of a Successful Remarketing on the
Final Remarketing Date, the interest rate per annum on the Senior Notes
determined by the Remarketing Agent as necessary to remarket the Remarketed
Senior Notes at a price per Remarketed Senior Note such that the aggregate price
for the Remarketed Senior Notes is equal to approximately 100.50% (but not less
than 100%, net of any Remarketing Fee) of the aggregate principal amount of the
Remarketed Senior Notes; provided that if there are no Corporate Units
outstanding and none of the Holders elect to have Separate Senior Notes held by
them remarketed, or in the case of a Failed Remarketing, the interest rate
payable on the Senior Notes will not be reset and the interest rate payable on
the Senior Notes shall continue to be 2.25% per year; provided further that in
no event shall the Reset Rate exceed the maximum rate, if any, permitted by
applicable law.

         "RESPONSIBLE OFFICER" means, with respect to the Purchase Contract
Agent, any officer of the Purchase Contract Agent assigned by the Purchase
Contract Agent to administer this Purchase Contract Agreement.

         "RIGHTS" has the meaning set forth in Section 5.04(a)(11).

         "RIGHTS AGREEMENT" has the meaning set forth in Section 5.04(a)(11).

         "SECOND REMARKETING" has the meaning set forth in Section 5.02(b).

         "SECOND REMARKETING DATE" means the third Business Day immediately
preceding June 16, 2006.

                                       11

<PAGE>

         "SECURITIES ACT" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.

         "SECURITIES INTERMEDIARY" means BNY Midwest Trust Company, an Illinois
trust company, as Securities Intermediary under the Pledge Agreement until a
successor Securities Intermediary shall have become such pursuant to the
applicable provisions of the Pledge Agreement, and thereafter "SECURITIES
INTERMEDIARY" shall mean such successor or any subsequent successor who is
appointed pursuant to the Pledge Agreement.

         "SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective
meanings set forth in Section 3.05.

         "SENIOR NOTES" means the series of notes designated the senior notes
due August 16, 2008 to be issued by the Company under the Indenture.

         "SEPARATE SENIOR NOTES" means Senior Notes that are no longer
represented by Corporate Units.

         "SEPARATE SENIOR NOTES PURCHASE PRICE" means the amount in cash equal
to the product of the Remarketing Per Senior Note Price multiplied by the number
of Separate Senior Notes remarketed in the Initial Remarketing, the Second
Remarketing or the Third Remarketing, as the case may be.

         "SETTLEMENT RATE" has the meaning set forth in Section 5.01.

         "SPECIAL EVENT" means either a Tax Event or an Accounting Event.

         "SPECIAL EVENT REDEMPTION" means the redemption of the Senior Notes
pursuant to the Indenture following the occurrence of a Special Event.

         "SPECIAL EVENT REDEMPTION DATE" means the date upon which a Special
Event Redemption is scheduled to occur pursuant to the Indenture.

         "STATED AMOUNT" means $25.00.

         "SUCCESSFUL FINAL REMARKETING" has the meaning set forth in Section
5.02(d).

         "SUCCESSFUL INITIAL REMARKETING" has the meaning set forth in Section
5.02(a).

         "SUCCESSFUL REMARKETING" means any of (i) a Successful Initial
Remarketing, (ii) a Successful Second Remarketing, (iii) a Successful Third
Remarketing or (iv) a Successful Final Remarketing.

         "SUCCESSFUL SECOND REMARKETING" has the meaning set forth in Section
5.02(b).

         "SUCCESSFUL THIRD REMARKETING" has the meaning set forth in Section
5.02(b).

                                       12

<PAGE>

         "TAX EVENT" means the receipt by the Company of an opinion of counsel,
rendered by a law firm having a recognized national tax practice, at any time
prior to the earlier of the date of any Successful Remarketing and the Purchase
Contract Settlement Date, to the effect that, as a result of any amendment to,
change in or announced proposed change in the laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or therein, or as a result of any official administrative
decision, pronouncement, judicial decision or action interpreting or applying
such laws or regulations, which amendment or change is effective or which
proposed change, pronouncement, action or decision is announced on or after the
date of original issuance of the Senior Notes, there is more than an
insubstantial increase in the risk that interest payable by the Company on the
Senior Notes is not, or within 90 days of the date of such opinion, will not be,
deductible by the Company, in whole or in part, for United States federal income
tax purposes.

         "TERMINATION DATE" means the date, if any, on which a Termination Event
occurs.

         "TERMINATION EVENT" means the occurrence of any of the following
events:

                  (i) at any time on or prior to the Purchase Contract
         Settlement Date, a judgment, decree or court order shall have been
         entered granting relief under the Bankruptcy Code, adjudicating the
         Company to be insolvent, or approving as properly filed a petition
         seeking reorganization or liquidation of the Company or any other
         similar applicable Federal or state law and if such judgment, decree or
         order shall have been entered more than 60 days prior to the Purchase
         Contract Settlement Date, such decree or order shall have continued
         undischarged and unstayed for a period of 60 days;

                  (ii) at any time on or prior to the Purchase Contract
         Settlement Date, a judgment, decree or court order for the appointment
         of a receiver or liquidator or trustee or assignee in bankruptcy or
         insolvency of the Company or of its property, or for the termination or
         liquidation of its affairs, shall have been entered and if such
         judgment, decree or order shall have been entered more than 60 days
         prior to the Purchase Contract Settlement Date, such judgment, decree
         or order shall have continued undischarged and unstayed for a period of
         60 days; or

                  (iii) at any time on or prior to the Purchase Contract
         Settlement Date, the Company shall file a petition for relief under the
         Bankruptcy Code, or shall consent to the filing of a bankruptcy
         proceeding against it, or shall file a petition or answer or consent
         seeking reorganization or liquidation under the Bankruptcy Code or any
         other similar applicable Federal or State law, or shall consent to the
         filing of any such petition, or shall consent to the appointment of a
         receiver or liquidator or trustee or assignee in bankruptcy or
         insolvency of it or of its property, or shall make an assignment for
         the benefit of creditors, or shall admit in writing its inability to
         pay its debts generally as they become due.

         "THIRD REMARKETING" has the meaning set forth in Section 5.02(b).

                                       13

<PAGE>

         "THIRD REMARKETING DATE" means the third Business Day immediately
preceding July 16, 2006.

         "THRESHOLD APPRECIATION PRICE" has the meaning set forth in Section
5.01.

         "TIA" means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.

         "TRADING DAY" has the meaning set forth in Section 5.01.

         "TREASURY PORTFOLIO" means a portfolio of (1) U.S. treasury securities
(or principal or interest strips thereof) that mature on or prior to August 15,
2006 in an aggregate amount at maturity equal to the Applicable Principal
Amount, and (2) (x) in the case of a Successful Remarketing prior to the Final
Remarketing Date, for the scheduled Payment Date on the Senior Notes that occurs
on the Purchase Contract Settlement Date, U.S. treasury securities (or principal
or interest strips thereof) that mature on or prior to August 15, 2006 in an
aggregate amount at maturity equal to the aggregate interest payment (assuming
no reset of the interest rate) that would have been due on the Purchase Contract
Settlement Date on the Applicable Principal Amount, and (y) in the case of a
Special Event Redemption, for each scheduled Payment Date that occurs after the
Special Event Redemption Date to and including the Purchase Contract Settlement
Date, U.S. treasury securities (or principal or interest strips thereof) that
mature on or prior to the business day immediately preceding such scheduled
Payment Date in an aggregate amount at maturity equal to the aggregate interest
payment (assuming no reset of the interest rate) that would have been due on
such scheduled Payment Date on the Applicable Principal Amount.

         "TREASURY PORTFOLIO PURCHASE PRICE" means the lowest aggregate ask-side
price quoted by a Primary Treasury Dealer to the Quotation Agent between 9:00
a.m. and 11:00 a.m. (New York City time) (i) in the case of a Special Event
Redemption, on the third Business Day immediately preceding the Special Event
Redemption Date for the purchase of the applicable Treasury Portfolio for
settlement on the Special Event Redemption Date, and (ii) in the case of any
Successful Remarketing prior to the Final Remarketing Date, on the date of such
Successful Remarketing for the purchase of the applicable Treasury Portfolio for
settlement on the third Business Day immediately following the date of such
Successful Remarketing.

         "TREASURY SECURITIES" means(i) zero-coupon U.S. treasury securities
that mature on July 15, 2006 (CUSIP No. 912820BT3) and, during the period
between July 15, 2006 and August 15, 2006, the Proceeds from such Treasury
Securities, and (ii) zero-coupon U.S. treasury securities that mature on August
15, 2006 (CUSIP No. 912833CQ1).

         "TREASURY UNIT" means, following the substitution of Treasury
Securities for Pledged Senior Notes or the Pledged Applicable Ownership Interest
in the Treasury Portfolio as collateral to secure a Holder's obligations under
the Purchase Contract, the collective rights and obligations of a Holder of a
Treasury Units Certificate in respect of (i) the Purchase Contracts represented
thereby and (ii) such Treasury Securities (subject to the Pledge thereof)
represented thereby.

                                       14

<PAGE>

         "TREASURY UNITS CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Treasury Units specified
on such certificate.

         "UNDERWRITERS" means the underwriters identified in Schedule II to the
Underwriting Agreement.

         "UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated June
18, 2003, among the Company and the Underwriters.

         "UNIT" means a Corporate Unit or a Treasury Unit, as the case may be.

         "VICE PRESIDENT" means any vice president, whether or not designated by
a number or a word or words added before or after the title "vice president."

         SECTION 1.02. Compliance Certificates and Opinions.

         Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Purchase Contract Agent to take any
action in accordance with any provision of this Agreement, the Company shall
furnish to the Purchase Contract Agent an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with, except that in the case of any such
application or request as to which the furnishing of such document is
specifically required by any provision of this Agreement relating to such
particular application or request, no additional certificate need be furnished.

         Every certificate with respect to compliance with a condition or
covenant provided for in this Agreement (other than the Officers' Certificate
provided for in Section 10.05) shall include:

                  (i) a statement that each individual signing such certificate
         has read such covenant or condition and the definitions herein relating
         thereto;

                  (ii) a brief statement as to the nature and scope of the
         examination or investigation upon which the statements contained in
         such certificate are based;

                  (iii) a statement that, in the opinion of each such
         individual, he or she has made such examination or investigation as is
         necessary to enable such individual to express an informed opinion as
         to whether or not such covenant or condition has been complied with;
         and

                  (iv) a statement as to whether, in the opinion of each such
         individual, such condition or covenant has been complied with.

                                       15

<PAGE>

         SECTION 1.03. Form of Documents Delivered to Purchase Contract Agent.

         In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents. Any
certificate or opinion of an officer of the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which its certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Company unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.

         Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.

         SECTION 1.04. Acts of Holders; Record Dates.

         (a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Purchase Contract Agent and, where it is hereby expressly required, to
the Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "ACT" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 7.01) conclusive in favor of
the Purchase Contract Agent and the Company, if made in the manner provided in
this Section.

         (b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner that the Purchase Contract
Agent deems sufficient.

         (c) The ownership of Units shall be proved by the Security Register.

         (d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Unit shall bind every future Holder of
the same Unit and the Holder of every Certificate evidencing such Unit issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the

                                       16

<PAGE>

Purchase Contract Agent or the Company in reliance thereon, whether or not
notation of such action is made upon such Certificate.

         (e) The Company may set any date as a record date for the purpose of
determining the Holders of Outstanding Units entitled to give, make or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Units. If any record date is set pursuant to this paragraph, the
Holders of the Outstanding Corporate Units and the Outstanding Treasury Units,
as the case may be, on such record date, and no other Holders, shall be entitled
to take the relevant action with respect to the Corporate Units or the Treasury
Units, as the case may be, whether or not such Holders remain Holders after such
record date; provided that no such action shall be effective hereunder unless
taken prior to or on the applicable Expiration Date by Holders of the requisite
number of Outstanding Units on such record date. Nothing contained in this
paragraph shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and be of no effect), and nothing
contained in this paragraph shall be construed to render ineffective any action
taken by Holders of the requisite number of Outstanding Units on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Purchase Contract Agent in writing and to each Holder of Units in
the manner set forth in Section 1.06.

         With respect to any record date set pursuant to this Section 1.04(e),
the Company may designate any date as the "EXPIRATION DATE" and from time to
time may change the Expiration Date to any earlier or later day; provided that
no such change shall be effective unless notice of the proposed new Expiration
Date is given to the Purchase Contract Agent in writing, and to each Holder of
Units in the manner set forth in Section 1.06, prior to or on the existing
Expiration Date. If an Expiration Date is not designated with respect to any
record date set pursuant to this Section, the Company shall be deemed to have
initially designated the 180th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.

         SECTION 1.05. Notices.

         Any notice or communication is duly given if in writing and delivered
in Person or mailed by first-class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Purchase Contract Agent only upon receipt thereof:

                                       17

<PAGE>

         If to the Purchase Contract Agent:

                  Bank One Trust Company, N.A.
                  153 West 51st Street
                  New York, New York 10019
                  Attention: Corporate Trust Administration
                  Fax: (212) 373-1383

         If to the Company:

                  The Chubb Corporation
                  15 Mountain View Road
                  Warren, New Jersey 07061-1615
                  Attention: General Counsel
                  Fax: (908) 903-3607

         If to the Collateral Agent:

                  BNY Midwest Trust Company
                  2 North LaSalle Street, Suite 1020
                  Chicago, Illinois 60602
                  Attention: Corporate Finance
                  Fax: (312) 827-8542

         If to the Indenture Trustee:

                  Bank One Trust Company, N.A.
                  153 West 51st Street
                  New York, New York 10019
                  Attention: Corporate Trust Administration
                  Fax: (212) 373-1383

         The Purchase Contract Agent shall send to the Indenture Trustee at the
telecopier number set forth above a copy of any notices in the form of Exhibits
D, E, F or G it sends or receives.

         SECTION 1.06. Notice to Holders; Waiver.

         Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the

                                       18

<PAGE>

Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Purchase Contract Agent, but such filing shall not be a
condition precedent to the validity of any action taken in reliance upon such
waiver.

         In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Purchase
Contract Agent shall constitute a sufficient notification for every purpose
hereunder.

         SECTION 1.07. Effect of Headings and Table of Contents.

         The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.

         SECTION 1.08. Successors and Assigns.

         All covenants and agreements in this Agreement by the Company and the
Purchase Contract Agent shall bind their respective successors and assigns,
whether so expressed or not.

         SECTION 1.09. Separability Clause.

         In case any provision in this Agreement or in the Units shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.

         SECTION 1.10. Benefits of Agreement.

         Nothing contained in this Agreement or in the Units, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this Agreement.
The Holders from time to time shall be beneficiaries of this Agreement and shall
be bound by all of the terms and conditions hereof and of the Units evidenced by
their Certificates by their acceptance of delivery of such Certificates.

         SECTION 1.11. Governing Law.

         This Agreement and the Purchase Contracts represented by the Units
shall be governed by, and construed in accordance with, the laws of the State of
New York.

                                       19

<PAGE>

         SECTION 1.12. Legal Holidays.

         In any case where any Payment Date shall not be a Business Day
(notwithstanding any other provision of this Agreement, the Purchase Contracts
or the Senior Notes), Contract Adjustment Payments or other distributions shall
not be paid on such date, but Contract Adjustment Payments or such other
distributions shall be paid on the next succeeding Business Day, unless such
Business Day is in the next succeeding calendar year, in which case such
Contract Adjustment Payments or other distributions shall be paid on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such Payment Date.

         In any case where the Purchase Contract Settlement Date or any Early
Settlement Date or Cash Merger Early Settlement Date shall not be a Business Day
(notwithstanding any other provision of this Agreement or the Units), Purchase
Contracts shall not be performed and Early Settlement and Cash Merger Early
Settlement shall not be effected on such date, but Purchase Contracts shall be
performed or Early Settlement or Cash Merger Early Settlement shall be effected,
as applicable, on the next succeeding Business Day with the same force and
effect as if made on such Purchase Contract Settlement Date, Early Settlement
Date or Cash Merger Early Settlement Date, as applicable.

         SECTION 1.13. Counterparts.

         This Agreement may be executed in any number of counterparts by the
parties hereto on separate counterparts, each of which, when so executed and
delivered, shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.

         SECTION 1.14. Inspection of Agreement.

         A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder or Beneficial Owner.

         SECTION 1.15. Appointment of Financial Institution as Agent for the
Company.

         The Company may appoint a financial institution (which may be the
Collateral Agent) to act as its agent in performing its obligations and in
accepting and enforcing performance of the obligations of the Purchase Contract
Agent and the Holders, under this Agreement and the Purchase Contracts, by
giving notice of such appointment in the manner provided in Section 1.05 hereof.
Any such appointment shall not relieve the Company in any way from its
obligations hereunder.

         SECTION 1.16. No Waiver.

         No failure on the part of the Company, the Purchase Contract Agent, the
Collateral Agent, the Securities Intermediary or any of their respective agents
to exercise, and no course of dealing with respect to, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by the Company, the Collateral
Agent, the Securities Intermediary or any of their respective agents of any
right, power

                                       20

<PAGE>

or remedy hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. The remedies herein are cumulative
and are not exclusive of any remedies provided by law.

                                   ARTICLE 2

                               CERTIFICATE FORMS

         SECTION 2.01. Forms of Certificates Generally.

         The Certificates (including the form of Purchase Contract represented
by each Unit evidenced thereby) shall be in substantially the form set forth in
Exhibit A hereto (in the case of Certificates evidencing Corporate Units),
Exhibit B hereto (in the case of Certificates evidencing Treasury Units
containing Treasury Securities maturing on July 15, 2006) or Exhibit C hereto
(in the case of Certificates evidencing Treasury Units containing Treasury
Securities maturing on August 15, 2006), with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Units are listed or any depositary therefor, or
as may, consistently herewith, be determined by the officers of the Company
executing such Certificates, as evidenced by their execution of the
Certificates.

         The definitive Certificates shall be produced in any manner as
determined by the officers of the Company executing the Certificates evidencing
the Units, consistent with the provisions of this Agreement, as evidenced by
their execution thereof.

         Every Global Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:

         THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
         PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED
         IN THE NAME OF CEDE & CO., AS NOMINEE OF THE DEPOSITORY TRUST COMPANY,
         A NEW YORK CORPORATION (THE "DEPOSITARY"), THE DEPOSITARY OR ANOTHER
         NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
         CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
         DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED
         IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE
         (OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY
         TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
         DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED
         EXCEPT IN LIMITED CIRCUMSTANCES.

                                       21

<PAGE>

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
         THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
         ANY CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR SUCH
         OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
         DEPOSITARY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
         OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
         DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
         OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
         HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

         SECTION 2.02. Form of Purchase Contract Agent's Certificate of
Authentication.

         The form of the Purchase Contract Agent's certificate of authentication
of the Units shall be in substantially the form set forth on the form of the
applicable Certificates.

                                   ARTICLE 3

                                   THE UNITS

         SECTION 3.01. Amount; Form and Denominations.

         The aggregate number of Units evidenced by Certificates authenticated,
executed on behalf of the Holders and delivered hereunder is limited to
18,400,000, except for Certificates authenticated, executed and delivered upon
registration of transfer of, in exchange for, or in lieu of, other Certificates
pursuant to Sections 3.04, 3.05, 3.10, 3.13, 3.14 or 8.05.

         The Certificates shall be issuable only in registered form and only in
denominations of a single Corporate Unit or Treasury Unit and any integral
multiple thereof.

         SECTION 3.02. Rights and Obligations Evidenced by the Certificates.

         Each Corporate Units Certificate shall evidence the number of Corporate
Units specified therein, with each such Corporate Unit representing (1) the
ownership by the Holder thereof of a beneficial interest in a Senior Note or the
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
subject to the Pledge of such Senior Note or the Applicable Ownership Interest
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, by such Holder pursuant to the Pledge Agreement,
and (2) the rights and obligations of the Holder thereof and the Company under
one Purchase Contract. The Purchase Contract Agent is hereby authorized, as
attorney-in-fact for, and on behalf of, the Holder of each Corporate Unit, to
pledge, pursuant to the Pledge Agreement, the Senior Note and the Applicable
Ownership Interest (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, if any, represented by such Corporate Unit, to the
Collateral Agent for the benefit of the Company, and to grant to the Collateral
Agent, for the benefit of the Company, a security interest in the right, title
and interest of such Holder in such Senior Note and the

                                       22

<PAGE>

Applicable Ownership Interest (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio, if any, to secure the obligation of the
Holder under each Purchase Contract to pay the Stated Amount of such Purchase
Contract and thereby purchase shares of Common Stock.

         Upon the formation of a Treasury Unit pursuant to Section 3.13, each
Treasury Unit Certificate shall evidence the number of Treasury Units specified
therein, with each such Treasury Unit representing (1) the ownership by the
Holder thereof of a 1/40 undivided beneficial interest in a Treasury Security
with a principal amount equal to $1,000, subject to the Pledge of such interest
by such Holder pursuant to the Pledge Agreement, and (2) the rights and
obligations of the Holder thereof and the Company under one Purchase Contract.
The Purchase Contract Agent is hereby authorized, as attorney-in-fact for, and
on behalf of, the Holder of each Treasury Unit, to pledge, pursuant to the
Pledge Agreement, such Holder's interest in the Treasury Security represented by
such Treasury Unit to the Collateral Agent, for the benefit of the Company, and
to grant to the Collateral Agent, for the benefit of the Company, a security
interest in the right, title and interest of such Holder in such Treasury
Security to secure the obligation of the Holder under each Purchase Contract to
pay the Stated Amount of such Purchase Contract and thereby purchase shares of
Common Stock.

         Prior to the purchase of shares of Common Stock under any Purchase
Contract, such Purchase Contract shall not entitle the Holder of the Unit
representing such Purchase Contract to any of the rights of a holder of shares
of Common Stock, including, without limitation, the right to vote or receive any
dividends or other payments or to consent or to receive notice as a shareholder
in respect of the meetings of shareholders or for the election of directors of
the Company or for any other matter, or any other rights whatsoever as a
shareholder of the Company.

         SECTION 3.03. Execution, Authentication, Delivery and Dating.

         Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Purchase Contract Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication of such
Certificates, and the Purchase Contract Agent in accordance with such Issuer
Order shall authenticate, execute on behalf of the Holders and deliver such
Certificates.

         The Certificates shall be executed on behalf of the Company by its
Chairman of the Board of Directors, its Vice Chairman of the Board of Directors,
its Chief Executive Officer, its President, its Treasurer, its Secretary or one
of its Vice Presidents. The signature of any of these officers on the
Certificates may be manual or facsimile.

         Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates.

                                       23

<PAGE>

         No Purchase Contract evidenced by a Certificate shall be valid until
such Certificate has been executed on behalf of the Holder by the manual
signature of an authorized officer of the Purchase Contract Agent, as such
Holder's attorney-in-fact. Such signature by an authorized officer of the
Purchase Contract Agent shall be conclusive evidence that the Holder of such
Certificate has entered into the Purchase Contracts evidenced by such
Certificate.

         Each Certificate shall be dated the date of its authentication.

         No Certificate shall be entitled to any benefit under this Agreement or
be valid or obligatory for any purpose unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by an authorized officer of the Purchase Contract Agent by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.

         SECTION 3.04. Temporary Certificates.

         Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall authenticate, execute on behalf of the Holders, and deliver, in lieu
of such definitive Certificates, temporary Certificates that are in
substantially the form set forth in Exhibit A, Exhibit B or Exhibit C hereto, as
the case may be, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
Corporate Units or Treasury Units, as the case may be, are listed, or as may,
consistently herewith, be determined by the officers of the Company executing
such Certificates, as evidenced by their execution of the Certificates.

         If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
Corporate Trust Office, at the expense of the Company and without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Company shall execute and deliver to the Purchase Contract
Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of
the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number of
Units as the temporary Certificate or Certificates so surrendered. Until so
exchanged, the temporary Certificates shall in all respects evidence the same
benefits and the same obligations with respect to the Units evidenced thereby as
definitive Certificates.

         SECTION 3.05. Registration; Registration of Transfer and Exchange.

         The Purchase Contract Agent shall keep at the Corporate Trust Office a
register (the "SECURITY REGISTER") in which, subject to such reasonable
regulations as it may prescribe, the Purchase Contract Agent shall provide for
the registration of Certificates and of transfers of Certificates (the Purchase
Contract Agent, in such capacity, the "SECURITY REGISTRAR"). The

                                       24

<PAGE>

Security Registrar shall record separately the registration and transfer of the
Certificates evidencing Corporate Units and Treasury Units.

         Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the name of
the designated transferee or transferees, one or more new Certificates of any
authorized denominations, like tenor, and evidencing a like number of Corporate
Units or Treasury Units, as the case may be.

         At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
Corporate Units or Treasury Units, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver the Certificates that
the Holder making the exchange is entitled to receive.

         All Certificates issued upon any registration of transfer or exchange
of a Certificate shall evidence the ownership of the same number of Corporate
Units or Treasury Units, as the case may be, and be entitled to the same
benefits and subject to the same obligations under this Agreement as the
Corporate Units or Treasury Units, as the case may be, evidenced by the
Certificate surrendered upon such registration of transfer or exchange.

         Every Certificate presented or surrendered for registration of transfer
or exchange shall (if so required by the Purchase Contract Agent) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Purchase Contract Agent duly executed, by
the Holder thereof or its attorney duly authorized in writing.

         No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Purchase Contract Agent may
require payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Certificates, other than any exchanges pursuant to
Sections 3.04, 3.06 and 8.05 not involving any transfer.

         Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder
and deliver any Certificate in exchange for any other Certificate presented or
surrendered for registration of transfer or for exchange on or after the
Business Day immediately preceding the earliest to occur of any Early Settlement
Date with respect to such Certificate, any Cash Merger Early Settlement Date
with respect to such Certificate, the Purchase Contract Settlement Date or the
Termination Date. In lieu of delivery of a new Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Purchase
Contract Agent shall:

                                       25

<PAGE>

                  (i) if the Purchase Contract Settlement Date (including upon
         any Cash Settlement) or an Early Settlement Date or a Cash Merger Early
         Settlement Date with respect to such other Certificate has occurred,
         deliver the shares of Common Stock issuable in respect of the Purchase
         Contracts represented by the Units evidenced by such other Certificate;
         or

                  (ii) if a Termination Event shall have occurred prior to the
         Purchase Contract Settlement Date, transfer the Senior Notes, the
         Treasury Securities, or the appropriate Applicable Ownership Interest
         in the Treasury Portfolio, as the case may be, evidenced thereby, in
         each case subject to the applicable conditions and in accordance with
         the applicable provisions of Section 3.15 and Article Five hereof.

         SECTION 3.06. Book-Entry Interests.

         The Certificates, on original issuance, will be issued in the form of
one or more fully registered Global Certificates, to be delivered to the
Depositary or its custodian by, or on behalf of, the Company. The Company hereby
designates DTC as the initial Depositary. Such Global Certificates shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.09. The Purchase Contract
Agent shall enter into an agreement with the Depositary if so requested by the
Company. Unless and until definitive, fully registered Certificates have been
issued to Beneficial Owners pursuant to Section 3.09:

                  (i) the provisions of this Section 3.06 shall be in full force
         and effect;

                  (ii) the Company and the Purchase Contract Agent shall be
         entitled to deal with the Depositary for all purposes of this Agreement
         (including, without limitation, making payments of Contract Adjustment
         Payments and receiving approvals, votes or consents hereunder) as the
         Holder of the Units and the sole holder of the Global Certificates and
         shall have no obligation to the Beneficial Owners;

                  (iii) to the extent that the provisions of this Section 3.06
         conflict with any other provisions of this Agreement, the provisions of
         this Section 3.06 shall control; and

                  (iv) the rights of the Beneficial Owners shall be exercised
         only through the Depositary and shall be limited to those established
         by law and agreements between such Beneficial Owners and the Depositary
         or the Depositary Participants.

Transfers of securities evidenced by Global Certificates shall be made through
the facilities of the Depositary, and any cancellation of, or increase or
decrease in the number of, such securities (including the creation of Treasury
Units and the recreation of Corporate Units pursuant to Sections 3.13 and 3.14,
respectively) shall be accomplished by making appropriate annotations on the
Schedule of Increases and Decreases for such Global Certificate.

                                       26

<PAGE>

         SECTION 3.07. Notices to Holders.

         Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any Units
registered in the name of the Depositary or the nominee of the Depositary, the
Company or the Company's agent shall, except as set forth herein, have no
obligations to the Beneficial Owners.

         SECTION 3.08. Appointment of Successor Depositary.

         If the Depositary elects to discontinue its services as securities
depositary with respect to the Units, the Company may, in its sole discretion,
appoint a successor Depositary with respect to the Units.

         SECTION 3.09. Definitive Certificates.

         If:

                  (i) the Depositary notifies the Company that it is unwilling
         or unable to continue its services as securities depositary with
         respect to the Units and no successor Depositary has been appointed
         pursuant to Section 3.08 within 90 days after such notice; or

                  (ii) the Depositary ceases to be a "clearing agency"
         registered under Section 17A of the Exchange Act when the Depositary is
         required to be so registered to act as the Depositary and so notifies
         the Company, and no successor Depositary has been appointed pursuant to
         Section 3.08 within 90 days after such notice; or

                  (iii) the Company determines in its discretion that the Global
         Certificates shall be exchangeable for definitive Certificates,

then (x) definitive Certificates evidencing the Units shall be prepared by the
Company and delivered to the Purchase Contract Agent and (y) upon surrender of
the Global Certificates evidencing the Units by the Depositary, accompanied by
registration instructions, the Company shall cause definitive Certificates to be
delivered to Beneficial Owners in accordance with the instructions of the
Depositary. The Company and the Purchase Contract Agent shall not be liable for
any delay in delivery of such instructions and may conclusively rely on and
shall be authorized and protected in relying on, such instructions. Each
definitive Certificate so delivered shall evidence Units of the same kind and
tenor as the Global Certificate so surrendered in respect thereof.

         SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.

         If any mutilated Certificate is surrendered to the Purchase Contract
Agent, the Company shall execute and deliver to the Purchase Contract Agent, and
the Purchase Contract Agent shall authenticate, execute on behalf of the Holder,
and deliver in exchange therefor, a new Certificate,

                                       27

<PAGE>

evidencing the same number of Corporate Units or Treasury Units, as the case may
be, and bearing a Certificate number not contemporaneously outstanding.

         If there shall be delivered to the Company and the Purchase Contract
Agent (i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity as may be required by them
to hold each of them and any agent of any of them harmless, then, in the absence
of notice to the Company or the Purchase Contract Agent that such Certificate
has been acquired by a protected purchaser, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver to the Holder, in
lieu of any such destroyed, lost or stolen Certificate, a new Certificate,
evidencing the same number of Corporate Units or Treasury Units, as the case may
be, and bearing a Certificate number not contemporaneously outstanding.

         Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder,
and deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earliest of any Early Settlement Date with respect to
such lost or mutilated Certificate, any Cash Merger Early Settlement Date with
respect to such lost or mutilated Certificate, the Purchase Contract Settlement
Date or the Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this Section and
receipt of appropriate registration or transfer instructions from such Holder,
the Purchase Contract Agent shall:

                  (i) if the Purchase Contract Settlement Date or Early
         Settlement Date or Cash Merger Early Settlement Date with respect to
         such lost, stolen, destroyed or mutilated Certificate has occurred,
         deliver the shares of Common Stock issuable in respect of the Purchase
         Contracts represented by the Units evidenced by such Certificate; or

                  (ii) if a Cash Settlement with respect to such lost or
         mutilated Certificate or if a Termination Event shall have occurred
         prior to the Purchase Contract Settlement Date, transfer the Senior
         Notes, the Treasury Securities or the appropriate Applicable Ownership
         Interest (as specified in clause (i) of the definition of such term) in
         the Treasury Portfolio, as the case may be, evidenced thereby, in each
         case subject to the applicable conditions and in accordance with the
         applicable provisions of Section 3.15 and Article Five hereof.

         Upon the issuance of any new Certificate under this Section, the
Company and the Purchase Contract Agent may require the payment by the Holder of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other fees and expenses (including, without
limitation, the fees and expenses of the Purchase Contract Agent) connected
therewith.

         Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the Units
evidenced thereby, whether or not the destroyed, lost or

                                       28

<PAGE>

stolen Certificate (and the Units evidenced thereby) shall be at any time
enforceable by anyone, and shall be entitled to all the benefits and be subject
to all the obligations of this Agreement equally and proportionately with any
and all other Certificates delivered hereunder.

         The provisions of this Section are exclusive and shall preclude, to the
extent lawful, all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.

         SECTION 3.11. Persons Deemed Owners.

         Prior to due presentment of a Certificate for registration of transfer,
the Company and the Purchase Contract Agent, and any agent of the Company or the
Purchase Contract Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Units evidenced thereby for purposes of (subject
to any applicable record date) any payment or distribution on the Senior Notes
or on the Applicable Ownership Interests (as specified in clause (ii) of the
definition of such term) in the Treasury Portfolio (if any), as applicable,
payment of Contract Adjustment Payments and performance of the Purchase
Contracts and for all other purposes whatsoever in connection with such Units,
whether or not such payment, distribution, or performance shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor the
Purchase Contract Agent, nor any agent of the Company or the Purchase Contract
Agent, shall be affected by notice to the contrary.

         Notwithstanding the foregoing, with respect to any Global Certificate,
nothing contained herein shall prevent the Company, the Purchase Contract Agent
or any agent of the Company or the Purchase Contract Agent from giving effect to
any written certification, proxy or other authorization furnished by the
Depositary (or its nominee), as a Holder, with respect to such Global
Certificate, or impair, as between such Depositary and the related Beneficial
Owner, the operation of customary practices governing the exercise of rights of
the Depositary (or its nominee) as Holder of such Global Certificate. None of
the Company, the Purchase Contract Agent or any agent of the Company or the
Purchase Contract Agent will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial ownership
interests of a Global Certificate or maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.

         SECTION 3.12. Cancellation.

         All Certificates surrendered for delivery of shares of Common Stock on
or after the Purchase Contract Settlement Date or upon the transfer of Senior
Notes, or for delivery of the appropriate Applicable Ownership Interest in the
Treasury Portfolio or Treasury Securities, as the case may be, after the
occurrence of a Termination Event or pursuant to a Cash Settlement, an Early
Settlement or a Cash Merger Early Settlement, or upon the registration of
transfer or exchange of a Unit, or a Collateral Substitution or the recreation
of Corporate Units shall, if surrendered to any Person other than the Purchase
Contract Agent, be delivered to the Purchase Contract Agent along with
appropriate written instructions regarding the cancellation thereof and, if not
already cancelled, shall be promptly cancelled by it. The Company may at any
time deliver to the Purchase Contract Agent for cancellation any Certificates
previously authenticated,

                                       29

<PAGE>

executed and delivered hereunder that the Company may have acquired in any
manner whatsoever, and all Certificates so delivered shall, upon an Issuer
Order, be promptly cancelled by the Purchase Contract Agent. No Certificates
shall be authenticated, executed on behalf of the Holder and delivered in lieu
of or in exchange for any Certificates cancelled as provided in this Section,
except as expressly permitted by this Agreement. All cancelled Certificates
held by the Purchase Contract Agent shall be disposed of in accordance with its
customary practices.

         If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Purchase
Contract Agent cancelled or for cancellation.

         SECTION 3.13. Creation of Treasury Units by Substitution of Treasury
Securities.

         Unless the Treasury Portfolio has replaced the Senior Notes represented
by the Corporate Units, and subject to the conditions set forth in this
Agreement, a Holder may, at any time from and after the date of this Agreement
and prior to 5:00 p.m. (New York City time) on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date, effect a Collateral
Substitution and separate the Senior Notes represented by such Holder's
Corporate Units from the Purchase Contracts so represented by substituting, for
such Senior Notes, Treasury Securities in an aggregate principal amount at
maturity equal to the aggregate principal amount of such Senior Notes; provided
that Holders may make such Collateral Substitutions only in integral multiples
of 40 Corporate Units. To effect such substitution, the Holder must:

                  (1) deposit with the Securities Intermediary Treasury
                      Securities having an aggregate principal amount at
                      maturity equal to the aggregate principal amount of the
                      Senior Notes represented by such Corporate Units; and

                  (2) transfer the related Corporate Units to the Purchase
                      Contract Agent accompanied by a notice to the Purchase
                      Contract Agent, substantially in the form of Exhibit D
                      hereto, (i) stating that the Holder has deposited the
                      relevant amount of Treasury Securities with the Securities
                      Intermediary and (ii) requesting that the Purchase
                      Contract Agent instruct the Collateral Agent to release
                      the Senior Notes represented by such Corporate Units,
                      whereupon the Purchase Contract Agent shall promptly
                      provide an instruction to such effect to the Collateral
                      Agent, substantially in the form of Exhibit A to the
                      Pledge Agreement.

         Upon receipt of the Treasury Securities described in clause (1) above
and the instruction described in clause (2) above, in accordance with the terms
of the Pledge Agreement, the Collateral Agent will cause the Securities
Intermediary to effect the release of such Senior Notes from the Pledge, free
and clear of the Company's security interest therein, and the transfer of such
Senior Notes to the Purchase Contract Agent on behalf of the Holder. Upon
receipt of such Senior Notes, the Purchase Contract Agent shall promptly:

                  (i) cancel the related Corporate Units;

                                       30

<PAGE>

                  (ii) transfer the Senior Notes to the Holder (such Senior
         Notes shall be tradeable as a separate security, independent of the
         resulting Treasury Units); and

                  (iii) authenticate, execute on behalf of such Holder and
         deliver Treasury Units in book-entry form or, if applicable, in the
         form of a Treasury Units Certificate executed by the Company in
         accordance with Section 3.03, representing the same number of Purchase
         Contracts as were represented by the cancelled Corporate Units.

         Holders who elect to separate the Senior Notes from the related
Purchase Contracts and to substitute Treasury Securities for such Senior Notes
shall be responsible for any fees or expenses (including, without limitation,
fees and expenses payable to the Collateral Agent for its services as Collateral
Agent) in respect of the substitution, and neither the Company nor the Purchase
Contract Agent shall be responsible for any such fees or expenses.

          If the Treasury Portfolio has replaced the Senior Notes represented by
the Corporate Units and subject to the conditions set forth in this Agreement, a
Holder may, at any time on or prior to the second Business Day immediately
preceding the Purchase Contract Settlement Date, substitute Treasury Securities
for the Applicable Ownership Interests in the Treasury Portfolio represented by
such Corporate Units, but only in integral multiples of 64,000 Corporate Units.
In such an event, the Holder shall transfer Treasury Securities to the
Securities Intermediary, and the Purchase Contract Agent shall instruct the
Collateral Agent to release the Pledge of and transfer to the Holder the
appropriate Applicable Ownership Interests in the Treasury Portfolio in the
manner set forth above.

         In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the Corporate Units or
fails to deliver Corporate Units Certificates to the Purchase Contract Agent
after depositing Treasury Securities with the Securities Intermediary, any
distributions on the Senior Notes or Applicable Ownership Interest in the
Treasury Portfolio represented by such Corporate Units shall be held in the name
of the Purchase Contract Agent or its nominee in trust for the benefit of such
Holder, until such Corporate Units are so transferred or the Corporate Units
Certificate is so delivered, as the case may be, or, such Holder provides
evidence satisfactory to the Company and the Purchase Contract Agent that such
Corporate Units Certificate has been destroyed, lost or stolen, together with
any indemnity that may be required by the Purchase Contract Agent and the
Company.

         Except as described in Section 5.02 or in this Section 3.13 or in
connection with a Cash Settlement, an Early Settlement, a Cash Merger Early
Settlement or a Termination Event, for so long as the Purchase Contract
represented by a Corporate Unit remains in effect, such Corporate Units shall
not be separable into the Purchase Contracts and Senior Notes or Applicable
Ownership Interests in the Treasury Portfolio, as the case may be, represented
thereby, and the rights and obligations of the Holder in respect of the Senior
Notes or Applicable Ownership Interests in the Treasury Portfolio, as the case
may be, and the Purchase Contract represented by such Corporate Units may be
acquired, and may be transferred and exchanged, only as a Corporate Unit.

                                       31

<PAGE>

         SECTION 3.14. Recreation of Corporate Units.

         Unless the Treasury Portfolio has replaced the Senior Notes represented
by the Corporate Units, and subject to the conditions set forth in this
Agreement, a Holder of Treasury Units may recreate Corporate Units at any time
on or prior to 5:00 p.m. (New York City time) on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date; provided that
Holders of Treasury Units may only recreate Corporate Units in integral
multiples of 40 Treasury Units. To recreate Corporate Units, the Holder must:

                  (1) transfer to the Securities Intermediary Senior Notes
                      having an aggregate principal amount equal to the
                      aggregate principal amount at stated maturity of the
                      Treasury Securities represented by the Treasury Units; and

                  (2) transfer the related Treasury Units to the Purchase
                      Contract Agent accompanied by a notice to the Purchase
                      Contract Agent, substantially in the form of Exhibit D
                      hereto, (i) stating that the Holder has transferred the
                      relevant amount of Senior Notes to the Securities
                      Intermediary and (ii) requesting that the Purchase
                      Contract Agent instruct the Collateral Agent to release
                      the Treasury Securities represented by such Treasury
                      Units, whereupon the Purchase Contract Agent shall
                      promptly provide an instruction to such effect to the
                      Collateral Agent, substantially in the form of Exhibit C
                      to the Pledge Agreement.

Upon receipt of the Senior Notes described in clause (1) above and the
instruction described in clause (2) above, in accordance with the terms of the
Pledge Agreement, the Collateral Agent will cause the Securities Intermediary to
effect the release of the Treasury Securities having a corresponding aggregate
principal amount at maturity from the Pledge, free and clear of the Company's
security interest therein, and the transfer thereof to the Purchase Contract
Agent on behalf of the Holder. Upon receipt of such Treasury Securities, the
Purchase Contract Agent shall promptly:

                  (i) cancel the related Treasury Units;

                  (ii) transfer the Treasury Securities to the Holder; and

                  (iii) authenticate, execute on behalf of such Holder and
         deliver Corporate Units in book-entry form or, if applicable, in the
         form of a Corporate Units Certificate executed by the Company in
         accordance with Section 3.03, representing the same number of Purchase
         Contracts as were represented by the cancelled Treasury Units.

         Holders who elect to recreate Corporate Units shall be responsible for
any fees or expenses (including, without limitation, fees and expenses payable
to the Collateral Agent for its services as Collateral Agent) in respect of the
recreation, and neither the Company nor the Purchase Contract Agent shall be
responsible for any such fees or expenses.

                                       32

<PAGE>

         If the Treasury Portfolio has replaced the Senior Notes represented by
the Corporate Units, a Holder may at any time on or prior to the second Business
Day immediately preceding the Purchase Contract Settlement Date substitute the
Applicable Ownership Interests in the Treasury Portfolio for Treasury
Securities, but only in multiples of 64,000 Treasury Units. In such an event,
the Holder shall transfer the Applicable Ownership Interests in the Treasury
Portfolio to the Collateral Agent in an amount such that the aggregate principal
amount at maturity of the portion of such Applicable Ownership Interests in the
Treasury Portfolio (as specified in clause (i) of the definition of such term)
is equal to the aggregate Stated Amount of the Purchase Contracts underlying
such Treasury Units, and the Purchase Contract Agent shall instruct the
Collateral Agent to release the Pledge of and transfer to the Holder Treasury
Securities in the manner set forth above.

         Except as provided in Section 5.02 or in this Section 3.14 or in
connection with a Cash Settlement, an Early Settlement, a Cash Merger Early
Settlement or a Termination Event, for so long as the Purchase Contract
represented by a Treasury Unit remains in effect, such Treasury Unit shall not
be separable into its constituent parts and the rights and obligations of the
Holder of such Treasury Unit in respect of the 1/40 of a Treasury Security and
the Purchase Contract represented by such Treasury Unit may be acquired, and may
be transferred and exchanged, only as a Treasury Unit.

         SECTION 3.15. Transfer of Collateral upon Occurrence of Termination
Event.

         Upon the occurrence of a Termination Event and the transfer to the
Purchase Contract Agent of the Senior Notes, the appropriate Applicable
Ownership Interests in the Treasury Portfolio or the Treasury Securities, as the
case may be, represented by the Corporate Units or the Treasury Units, as the
case may be, pursuant to the terms of the Pledge Agreement, the Purchase
Contract Agent shall request transfer instructions with respect to such Senior
Notes, the appropriate Applicable Ownership Interests in the Treasury Portfolio
or Treasury Securities, as the case may be, from each Holder by written request,
substantially in the form of Exhibit E hereto, mailed to such Holder at its
address as it appears in the Security Register.

         Upon book-entry transfer of the Corporate Units or the Treasury Units
or delivery of a Corporate Units Certificate or Treasury Units Certificate to
the Purchase Contract Agent with such transfer instructions, the Purchase
Contract Agent shall transfer the Senior Notes, the appropriate Applicable
Ownership Interests in the Treasury Portfolio or Treasury Securities, as the
case may be, represented by such Corporate Units or Treasury Units, as the case
may be, to such Holder by book-entry transfer, or other appropriate procedures,
in accordance with such instructions. In the event a Holder of Corporate Units
or Treasury Units fails to effect such transfer or delivery, the Senior Notes,
the appropriate Applicable Ownership Interests in the Treasury Portfolio or
Treasury Securities, as the case may be, represented by such Corporate Units or
Treasury Units, as the case may be, and any distributions thereon, shall be held
in the name of the Purchase Contract Agent or its nominee in trust for the
benefit of such Holder, until the earlier to occur of:

                                       33

<PAGE>

                  (i) the transfer of such Corporate Units or Treasury Units or
         surrender of the Corporate Units Certificate or Treasury Units
         Certificate or the receipt by the Company and the Purchase Contract
         Agent from such Holder of satisfactory evidence that such Corporate
         Units Certificate or Treasury Units Certificate has been destroyed,
         lost or stolen, together with any indemnity that may be required by the
         Purchase Contract Agent and the Company; and

                  (ii) the expiration of the time period specified in the
         abandoned property laws of the relevant State in which the Purchase
         Contract Agent holds such property.

         SECTION 3.16. No Consent to Assumption.

         Each Holder of a Unit, by acceptance thereof, shall be deemed expressly
to have withheld any consent to the assumption under Section 365 of the
Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidator or a person or entity performing similar functions
in the event that the Company becomes the debtor under the Bankruptcy Code or
subject to other similar state or Federal law providing for reorganization or
liquidation.

                                   ARTICLE 4

  THE SENIOR NOTES AND APPLICABLE OWNERSHIP INTERESTS IN THE TREASURY PORTFOLIO

         SECTION 4.01. Interest Payments; Rights to Interest Payments Preserved.

         Any payment on any Senior Note or on the appropriate Applicable
Ownership Interests (as specified in clause (ii) of the definition of such term)
in the Treasury Portfolio, as the case may be, which is paid on any Payment Date
shall, subject to receipt thereof by the Purchase Contract Agent from the
Collateral Agent as provided by the terms of the Pledge Agreement, be paid to
the Person in whose name the Corporate Units Certificate (or one or more
Predecessor Corporate Units Certificates) representing such Senior Note or the
appropriate Applicable Ownership Interests in the Treasury Portfolio, as the
case may be, is registered at the close of business on the Record Date for such
Payment Date.

         Each Corporate Units Certificate evidencing Senior Notes or the
appropriate Applicable Ownership Interests in the Treasury Portfolio delivered
under this Agreement upon registration of transfer of or in exchange for or in
lieu of any other Corporate Units Certificate shall carry the right to accrued
and unpaid interest or distributions, and to accrue interest or distributions,
which were carried by the Senior Notes or the appropriate Applicable Ownership
Interests in the Treasury Portfolio represented by such other Corporate Units
Certificate.

         In the case of any Corporate Unit with respect to which (A) Cash
Settlement of the Purchase Contract represented by such Corporate Unit is
properly effected pursuant to Section

                                       34

<PAGE>

5.02 hereof, (B) Early Settlement of the Purchase Contract represented by such
Corporate Unit is properly effected pursuant to Section 5.07 hereof, (C) Cash
Merger Early Settlement of the Purchase Contract represented by such Corporate
Unit is properly effected pursuant to Section 5.04(b)(2) hereof, (D) a
Collateral Substitution is properly effected pursuant to Section 3.13, or (E) a
Successful Initial Remarketing occurs with respect to the Senior Note that is
represented by such Corporate Unit, in each case on a date that is after any
Record Date and prior to or on the next succeeding Payment Date, interest on the
Senior Notes or distributions on the appropriate Applicable Ownership Interests
in the Treasury Portfolio, as the case may be, represented by such Corporate
Unit otherwise payable on such Payment Date shall be payable on such Payment
Date notwithstanding such Cash Settlement, Early Settlement, Cash Merger Early
Settlement, Collateral Substitution or Initial Remarketing, and such payment or
distributions shall, subject to receipt thereof by the Purchase Contract Agent,
be payable to the Person in whose name the Corporate Units Certificate (or one
or more Predecessor Corporate Units Certificates) was registered at the close of
business on the Record Date.

         Except as otherwise expressly provided in the immediately preceding
paragraph, in the case of any Corporate Units with respect to which Cash
Settlement, Early Settlement or Cash Merger Early Settlement of the Purchase
Contract represented by such Corporate Unit is properly effected, or with
respect to which a Collateral Substitution has been effected, payments on the
related Senior Notes or distributions on the appropriate Applicable Ownership
Interests in the Treasury Portfolio, as the case may be, that would otherwise be
payable or made after the Purchase Contract Settlement Date, Early Settlement
Date, Cash Merger Early Settlement Date or the date of the Collateral
Substitution, as the case may be, shall not be payable hereunder to the Holder
of such Corporate Units; provided, however, that to the extent that such Holder
continues to hold Separate Senior Notes or Applicable Ownership Interests in the
Treasury Portfolio that were formerly represented by such Holder's Corporate
Units, such Holder shall be entitled to receive interest on such Separate Senior
Notes or distributions on the Applicable Ownership Interests in the Treasury
Portfolio.

         SECTION 4.02. Notice and Voting.

         Under the terms of the Pledge Agreement, the Purchase Contract Agent
will be entitled to exercise the voting and any other consensual rights
pertaining to the Pledged Senior Notes, but only to the extent instructed in
writing by the Holders as described below. Upon receipt of notice of any meeting
at which holders of Senior Notes are entitled to vote or upon any solicitation
of consents, waivers or proxies of holders of Senior Notes, the Purchase
Contract Agent shall, as soon as practicable thereafter, mail, first class,
postage pre-paid, to the Holders of Corporate Units a notice:

                  (i) containing such information as is contained in the notice
         or solicitation;

                  (ii) stating that each Holder on the record date set by the
         Purchase Contract Agent therefor (which, to the extent possible, shall
         be the same date as the record date for determining the holders of
         Senior Notes, as the case may be, entitled to vote) shall be

                                       35

<PAGE>

         entitled to instruct the Purchase Contract Agent as to the exercise of
         the voting rights pertaining to such Senior Notes represented by their
         Corporate Units; and

                  (iii) stating the manner in which such instructions may be
         given.

Upon the written request of the Holders of Corporate Units on such record date
received by the Purchase Contract Agent at least six days prior to such meeting,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Senior Notes, as the case may be, as to which
any particular voting instructions are received. In the absence of specific
instructions from the Holder of a Corporate Unit, the Purchase Contract Agent
shall abstain from voting the Senior Notes represented by such Corporate Unit.
The Company hereby agrees, if applicable, to solicit Holders of Corporate Units
to timely instruct the Purchase Contract Agent in order to enable the Purchase
Contract Agent to vote such Senior Notes.

         The Holders of Corporate Units and Treasury Units shall have no voting
or other rights in respect of Common Stock.

         SECTION 4.03. Special Event Redemption.

         (a) If the Company elects to redeem the Senior Notes on any Payment
Date following the occurrence of a Special Event as permitted by the Indenture,
it shall notify the Collateral Agent in writing that a Special Event has
occurred and that it intends to redeem the Senior Notes and the Special Event
Redemption Date. On the Special Event Redemption Date, the Collateral Agent
shall surrender the Pledged Senior Notes to the Indenture Trustee against
delivery of an amount equal to the aggregate Redemption Price for such Pledged
Senior Notes. Thereafter, pursuant to the terms of the Pledge Agreement, the
Collateral Agent shall cause the Securities Intermediary to apply an amount
equal to the aggregate Redemption Amount of such funds to purchase on behalf of
the Holders of Corporate Units the Treasury Portfolio and promptly remit the
remaining portion of such funds to the Purchase Contract Agent for payment to
the Holders of such Corporate Units.

         (b) Upon the occurrence of a Special Event Redemption, (i) the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio will be substituted as Collateral for the
Pledged Senior Notes and will be held by the Securities Intermediary in
accordance with the terms of the Pledge Agreement to secure the obligation of
each Holder of a Corporate Unit to pay the Stated Amount of the related Purchase
Contract and thereby purchase Common Stock of the Company thereunder, (ii) the
Holders of Corporate Units and the Collateral Agent shall have such security
interest rights and obligations with respect to such Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) as the
Holders of Corporate Units and the Collateral Agent had in respect of the Senior
Notes, as the case may be, subject to the Pledge thereof as provided in the
Pledge Agreement, and (iii) any reference herein to the Senior Notes shall be
deemed to be a reference to such Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio. The
Company may cause to be made in any Corporate Units Certificates thereafter to
be issued such change in phraseology and form (but not in substance) as may be
appropriate to

                                       36

<PAGE>

reflect the substitution of the Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio for Senior
Notes as Collateral.

         (c) The Holders of Separate Senior Notes shall directly receive the
redemption price for the Separate Senior Notes.

                                   ARTICLE 5

                             THE PURCHASE CONTRACTS

         SECTION 5.01. Purchase of Shares of Common Stock.

         (a) Each Purchase Contract shall obligate the Holder of the related
Units to purchase, and the Company to sell, on the Purchase Contract Settlement
Date at a price equal to the Stated Amount, a number of newly issued shares of
Common Stock (subject to Section 5.09) equal to the Settlement Rate unless an
Early Settlement, a Cash Merger Early Settlement or a Termination Event with
respect to such Purchase Contract shall have occurred. The "SETTLEMENT RATE" is
equal to:

                  (i) if the Adjusted Applicable Market Value (as defined below)
         is greater than $71.40 (the "THRESHOLD APPRECIATION PRICE"), 0.3501
         shares of Common Stock per Purchase Contract;

                  (ii) if the Adjusted Applicable Market Value is less than or
         equal to the Threshold Appreciation Price but greater than or equal to
         $59.50 (the "REFERENCE PRICE"), the number of shares of Common Stock
         per Purchase Contract having a value equal to the Stated Amount divided
         by the Adjusted Applicable Market Value;

                  (iii) if the Adjusted Applicable Market Value is less than the
         Reference Price, 0.4202 shares of Common Stock per Purchase Contract;

in each case subject to adjustment as provided in Section 5.04 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).

         The "APPLICABLE MARKET VALUE" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date, subject to adjustments set forth under Section 5.04 hereof.

         The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any
adjustment of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a), the Applicable Market Value, and (ii) at
the time of and after any adjustment of the Settlement Rate pursuant to
paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of

                                       37

<PAGE>

Section 5.04(a), the Applicable Market Value multiplied by a fraction of which
the numerator shall be the Settlement Rate immediately after such adjustment
pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section
5.04(a) and the denominator shall be the Settlement Rate immediately prior to
such adjustment; provided, however, that if such adjustment to the Settlement
Rate is required to be made pursuant to the occurrence of any of the events
contemplated by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section
5.04(a) during the period taken into consideration for determining the
Applicable Market Value, appropriate and customary adjustments shall be made to
the Settlement Rate.

         The "CLOSING PRICE" per share of Common Stock on any date of
determination means:

                  (i) the closing sale price as of the close of the principal
         trading session (or, if no closing price is reported, the last reported
         sale price) per share on the New York Stock Exchange, Inc. (the "NYSE")
         on such date;

                  (ii) if the Common Stock is not listed for trading on the NYSE
         on any such date, the closing sale price (or, if no closing price is
         reported, the last reported sale price) per share as reported in the
         composite transactions for the principal United States national or
         regional securities exchange on which the Common Stock is so listed;

                  (iii) if the Common Stock is not so listed on a United States
         national or regional securities exchange, the last reported sale price
         per share as reported by The Nasdaq National Market, Inc.;

                  (iv) if the Common Stock is not so reported by the Nasdaq
         National Market, Inc., the last quoted bid price for the Common Stock
         in the over-the-counter market as reported by the National Quotation
         Bureau or similar organization; or

                  (v) if the bid price referred to in clause (iv) is not
         available, the market value of Common Stock on such date as determined
         by a nationally recognized independent investment banking firm retained
         by the Company for purposes of determining the Closing Price.

         A "TRADING DAY" means a day on which the Common Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.

         (b) Each Holder of a Corporate Unit or a Treasury Unit, by its
acceptance of such Unit:

                  (i) irrevocably authorizes the Purchase Contract Agent to
         enter into and perform the Purchase Contract represented thereby on its
         behalf as its attorney-in-fact (including, without limitation, the
         execution of Certificates on behalf of such Holder);

                  (ii) agrees to be bound by the terms and provisions thereof;

                                       38

<PAGE>

                  (iii) covenants and agrees to perform its obligations under
         such Purchase Contract for so long as such Holder remains a Holder of a
         Corporate Unit or a Treasury Unit representing such Purchase Contract;

                  (iv) consents to the provisions hereof;

                  (v) irrevocably authorizes the Purchase Contract Agent to
         enter into and perform this Agreement and the Pledge Agreement on its
         behalf and in its name as its attorney-in-fact;

                  (vi) consents to, and agrees to be bound by, the Pledge of
         such Holder's right, title and interest in and to the Collateral
         Account, including the Senior Notes and the Applicable Ownership
         Interests (as specified in clause (i) of the definition of such term)
         in the Treasury Portfolio or the Treasury Securities pursuant to the
         Pledge Agreement; and

                  (vii) for United States federal, state and local tax purposes,
         agrees to (i) treat an acquisition of the Corporate Units as an
         acquisition of the Senior Note and Purchase Contract represented by
         each Corporate Unit, (ii) treat the Senior Notes as indebtedness of the
         Company and (iii) treat itself as the owner of the applicable interest
         in the Collateral Account, including the Senior Notes and the
         Applicable Ownership Interests in the Treasury Portfolio (as specified
         in clause (i) of the definition of such term) or the Treasury
         Securities,

provided that upon a Termination Event, the rights of the Holder of such Units
under the Purchase Contract may be enforced without regard to any other rights
or obligations.

         (c) Each Holder of a Corporate Unit or a Treasury Unit, by its
acceptance thereof, further covenants and agrees that to the extent and in the
manner provided in Section 5.02 and the Pledge Agreement, but subject to the
terms thereof, the Treasury Securities or the Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as applicable, on the Purchase Contract Settlement Date, shall be
paid by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract and such Holder shall acquire no right,
title or interest in such Proceeds.

         (d) Upon registration of transfer of a Certificate, the transferee
shall be bound (without the necessity of any other action on the part of such
transferee) by the terms of this Agreement, the Purchase Contracts represented
by such Certificate and the Pledge Agreement and the transferor shall be
released from the obligations under this Agreement, the Purchase Contracts
represented by the Certificate so transferred and the Pledge Agreement. The
Company covenants and agrees, and each Holder of a Certificate, by its
acceptance thereof, likewise covenants and agrees, to be bound by the provisions
of this paragraph.

         SECTION 5.02. Remarketing; Payment of Stated Amount.

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<PAGE>

                  (a) (i) Unless a Special Event Redemption has occurred prior
         to the Initial Remarketing Date, the Company shall engage the
         Remarketing Agent pursuant to the Remarketing Agreement for Remarketing
         the Senior Notes. By 11:00 a.m. (New York City time) on the Business
         Day immediately preceding the Initial Remarketing Date, the Purchase
         Contract Agent shall notify the Remarketing Agent of the aggregate
         principal amount of Pledged Senior Notes, and the Custodial Agent shall
         notify the Remarketing Agent of the aggregate principal amount of
         Separate Senior Notes (if any) that are to be remarketed pursuant to
         clause (ii) below. Concurrently, the Collateral Agent, pursuant to the
         terms of the Pledge Agreement, will present for Remarketing the Pledged
         Senior Notes, and the Custodial Agent, pursuant to clause (ii) below,
         will present for Remarketing the Separate Senior Notes, to the
         Remarketing Agent. Upon receipt of such notice from the Purchase
         Contract Agent and Custodial Agent and the Pledged Senior Notes and
         Separate Senior Notes (if any) from the Collateral Agent and Custodial
         Agent, the Remarketing Agent will, on the Initial Remarketing Date, use
         its reasonable efforts to remarket (based on the Reset Rate) (the
         "INITIAL REMARKETING") such Pledged Senior Notes and Separate Senior
         Notes on such date at a price of approximately (but not less than)
         100.50% of the sum of the Treasury Portfolio Purchase Price plus the
         Separate Senior Notes Purchase Price. If the Remarketing Agent is able
         to remarket the Pledged Senior Notes and Separate Senior Notes at a
         price not less than 100.50% of the Treasury Portfolio Purchase Price
         plus the Separate Senior Notes Purchase Price (a "SUCCESSFUL INITIAL
         REMARKETING"), the portion of the proceeds from such Successful Initial
         Remarketing equal to the Treasury Portfolio Purchase Price will be
         applied to purchase the Treasury Portfolio. The Remarketing Agent shall
         deduct as a remarketing fee (the "REMARKETING FEE") an amount not
         exceeding 25 basis points (0.25%) of the sum of the Treasury Portfolio
         Purchase Price plus the Separate Senior Notes Purchase Price. None of
         the Company, the Purchase Contract Agent, or any Holders of Corporate
         Units or holders of Separate Senior Notes whose Senior Notes or
         Separate Senior Notes, as applicable, are so remarketed will otherwise
         be responsible for the payment of any Remarketing Fee in connection
         therewith. With respect to Separate Senior Notes, the proceeds of a
         Successful Initial Remarketing in excess of the Remarketing Fee
         attributable to the Separate Senior Notes will be remitted to the
         Custodial Agent for payment to the holders of Separate Senior Notes.
         With respect to Pledged Senior Notes, the proceeds of a Successful
         Initial Remarketing in excess of the sum of the Treasury Portfolio
         Purchase Price plus the Remarketing Fee with respect to such Pledged
         Senior Notes will be remitted to the Purchase Contract Agent for
         payment to the Holders of the related Corporate Units. The Treasury
         Portfolio will be substituted for the Pledged Senior Notes and the
         appropriate Applicable Ownership Interests (as specified in clause (i)
         of the definition of such term) in the Treasury Portfolio will be
         pledged to the Collateral Agent to secure the obligation of the Holders
         of Corporate Units to pay the Stated Amount for the Common Stock under
         the related Purchase Contracts on the Purchase Contract Settlement
         Date.

         Following the occurrence of a Successful Initial Remarketing, the
         Holders of Corporate Units and the Collateral Agent shall have such
         security interests, rights and obligations with respect to the
         Applicable Ownership Interests (as specified in clause (i) of the

                                       40

<PAGE>

         definition of such term) in the Treasury Portfolio as the Holder of
         Corporate Units and the Collateral Agent had in respect of the Senior
         Notes, subject to the Pledge thereof as provided in the Pledge
         Agreement, and any reference herein or in the Certificates to the
         Senior Notes shall be deemed to be a reference to such Applicable
         Ownership Interests in the Treasury Portfolio and any reference herein
         or in the Certificates to interest on the Senior Notes shall be deemed
         to be a reference to corresponding distributions on such Applicable
         Ownership Interests in the Treasury Portfolio. The Company may cause to
         be made in any Corporate Units Certificates thereafter to be issued
         such change in phraseology and form (but not in substance) as may be
         appropriate to reflect the substitution of such Applicable Ownership
         Interests in the Treasury Portfolio for Senior Notes.

         If, in spite of using its reasonable efforts, the Remarketing Agent
         cannot remarket the Pledged Senior Notes and the Separate Senior Notes
         (if any) in the Initial Remarketing (other than to the Company) at a
         price not less than 100.50% of the sum of the Treasury Portfolio
         Purchase Price plus the Separate Senior Notes Purchase Price or the
         Initial Remarketing is not settled in accordance with the Remarketing
         Agreement for any reason, including the failure to fulfill a condition
         precedent set forth in the Remarketing Agreement, the Initial
         Remarketing will be deemed to have failed (a "FAILED INITIAL
         REMARKETING"). Upon a Failed Initial Remarketing, the Remarketing Agent
         shall return the Pledged Senior Notes and Separate Senior Notes (if
         any) subject to such Remarketing to the Collateral Agent or the
         Custodial Agent, as the case may be.

                  (ii) Prior to 5:00 p.m. (New York City time) on the fifth
         Business Day immediately preceding the applicable Remarketing Date, but
         no earlier than the Payment Date immediately preceding such date,
         Holders of Separate Senior Notes may elect to have their Separate
         Senior Notes remarketed under the Remarketing Agreement by delivering
         their Separate Senior Notes, along with a notice of such election,
         substantially in the form of Exhibit F to the Pledge Agreement, to the
         Custodial Agent. After such time, such election shall become an
         election to have such Separate Senior Notes remarketed in such
         Remarketing and, if such Remarketing fails, in any subsequent
         Remarketing. The Custodial Agent shall hold Separate Senior Notes in an
         account separate from the Collateral Account in which the Pledged
         Senior Notes shall be held. Holders of Separate Senior Notes electing
         to have their Separate Senior Notes remarketed will also have the right
         to withdraw that election by written notice to the Custodial Agent,
         substantially in the form of Exhibit G to the Pledge Agreement, on or
         prior to 5:00 p.m. (New York City time) on the fifth Business Day
         immediately preceding the applicable Remarketing Date, upon which
         notice the Custodial Agent shall return such Separate Senior Notes to
         such Holder. By 11:00 a.m. on the Business Day immediately preceding
         the applicable Remarketing Date, the Custodial Agent shall notify the
         Remarketing Agent of the aggregate principal amount of the Separate
         Senior Notes to be remarketed and will deliver to the Remarketing Agent
         for remarketing all such Separate Senior Notes delivered to the
         Custodial Agent pursuant to Section 5.07(c) of the Pledge Agreement and
         not validly withdrawn prior to such date.

                                       41

<PAGE>

                  (iii) Not later than seven calendar days nor more than 15
         calendar days prior to the applicable Remarketing Date, the Company
         shall request the Depositary or its nominee to notify the Beneficial
         Owners or Depositary Participants holding Units of the procedures to be
         followed in such Remarketing.

                  (iv) The Company agrees to use commercially reasonable efforts
         to ensure that, if required by applicable law, a registration statement
         with regard to the full amount of the Senior Notes to be remarketed in
         the Initial Remarketing, the Second Remarketing, the Third Remarketing
         or the Final Remarketing, as the case may be, shall be effective with
         the Securities and Exchange Commission in a form that will enable the
         Remarketing Agent to use it in connection with such Remarketing.

                  (v) The Company shall cause a notice of a Failed Remarketing
         to be published (with a copy of such notice to be provided to the
         Purchase Contract Agent) on the Business Day immediately following the
         applicable Remarketing Date, in a daily newspaper in the English
         language of general circulation in the City of New York, which is
         expected to be The Wall Street Journal.

                  (b) (i) Unless a Special Event Redemption has occurred prior
         to the Second Remarketing Date, if a Failed Initial Remarketing occurs,
         the Remarketing Agent will use its reasonable efforts to remarket the
         Senior Notes (a "SECOND REMARKETING") on the Second Remarketing Date.
         By 11:00 a.m. (New York City time) on the Business Day immediately
         preceding the Second Remarketing Date for such Second Remarketing, the
         Purchase Contract Agent shall notify the Remarketing Agent of the
         aggregate principal amount of Pledged Senior Notes, and the Custodial
         Agent shall notify the Remarketing Agent of the aggregate principal
         amount of Separate Senior Notes (if any) that are to be remarketed
         pursuant to Section 5.02(a)(ii). Concurrently, the Collateral Agent,
         pursuant to the terms of the Pledge Agreement, and the Custodial Agent,
         pursuant to Section 5.02(a)(ii), will present for Remarketing the
         Pledged Senior Notes and the Separate Senior Notes (if any) that are to
         be remarketed to the Remarketing Agent. Upon receipt of such notice
         from the Purchase Contract Agent and the Custodial Agent and Pledged
         Senior Notes and Separate Senior Notes (if any) from the Collateral
         Agent and the Custodial Agent, the Remarketing Agent will, on the
         Second Remarketing Date, use its reasonable efforts to remarket (based
         on the Reset Rate) such Pledged Senior Notes and Separate Senior Notes
         on such date at a price of approximately (but not less than) 100.50% of
         the sum of the Treasury Portfolio Purchase Price plus the Separate
         Senior Notes Purchase Price. If the Remarketing Agent is able to
         remarket the Pledged Senior Notes and Separate Senior Notes at a price
         not less than 100.50% of the Treasury Portfolio Purchase Price plus the
         Separate Senior Notes Purchase Price (a "SUCCESSFUL SECOND
         REMARKETING"), the portion of the proceeds from such Successful Second
         Remarketing equal to the Treasury Portfolio Purchase Price will be
         applied to purchase the Treasury Portfolio. The Remarketing Agent shall
         deduct the Remarketing Fee from any amount of such proceeds in excess
         of the sum of the Treasury Portfolio Purchase Price plus the Separate
         Senior Notes Purchase Price. None of the Company, the Purchase Contract
         Agent or any Holders of Corporate Units or holders of Separate Senior
         Notes

                                       42

<PAGE>

         whose Senior Notes or Separate Senior Notes are so remarketed will
         otherwise be responsible for the payment of any Remarketing Fee in
         connection therewith. With respect to Separate Senior Notes, the
         proceeds of the Second Remarketing in excess of the Remarketing Fee
         attributable to the Separate Senior Notes will be remitted to the
         Custodial Agent for payment to the holders of Separate Senior Notes.
         With respect to Pledged Senior Notes, the proceeds of the Second
         Remarketing in excess of the sum of the Treasury Portfolio Purchase
         Price plus the Remarketing Fee with respect to such Pledged Senior
         Notes will be remitted to the Purchase Contract Agent for payment to
         the Holders of the related Corporate Units. The Treasury Portfolio will
         be substituted for the Pledged Senior Notes and the appropriate
         Applicable Ownership Interests (as specified in clause (i) of the
         definition of such term) in the Treasury Portfolio will be pledged to
         the Collateral Agent to secure the obligation of the Holders of
         Corporate Units to pay the Stated Amount for the Common Stock under the
         related Purchase Contracts on the Purchase Contract Settlement Date.

         Following the occurrence of a Successful Second Remarketing, the
         Holders of Corporate Units and the Collateral Agent shall have such
         security interests, rights and obligations with respect to the
         Applicable Ownership Interests (as specified in clause (i) of the
         definition of such term) in the Treasury Portfolio as the Holder of
         Corporate Units and the Collateral Agent had in respect of the related
         Senior Notes, subject to the Pledge thereof as provided in the Pledge
         Agreement, and any reference herein or in the Certificates to the
         Senior Notes shall be deemed to be a reference to such Applicable
         Ownership Interests in the Treasury Portfolio and any reference herein
         or in the Certificates to interest on the Senior Notes shall be deemed
         to be a reference to corresponding distributions on such Applicable
         Ownership Interests in the Treasury Portfolio. The Company may cause to
         be made in any Corporate Units Certificates thereafter to be issued
         such change in phraseology and form (but not in substance) as may be
         appropriate to reflect the substitution of such Applicable Ownership
         Interests in the Treasury Portfolio for Senior Notes.

         If, in spite of using its reasonable efforts, the Remarketing Agent
         cannot remarket the Pledged Senior Notes and Separate Senior Notes (if
         any) in a Second Remarketing (other than to the Company) at a price not
         less than 100.50% of the sum of the Treasury Portfolio Purchase Price
         plus the Separate Senior Notes Purchase Price or the Second Remarketing
         is not settled in accordance with the Remarketing Agreement for any
         reason, including the failure to fulfill a condition precedent set
         forth in the Remarketing Agreement, the Second Remarketing will be
         deemed to have failed (a "FAILED SECOND REMARKETING"). Upon a Failed
         Second Remarketing, the Remarketing Agent shall return the Pledged
         Senior Notes and the Separate Senior Notes (if any) subject to such
         Remarketing to the Collateral Agent or the Custodial Agent, as the case
         may be.

                  (ii) Unless a Special Event Redemption has occurred prior to
         the Third Remarketing Date, if a Failed Second Remarketing occurs, the
         Remarketing Agent will use its reasonable efforts to remarket the
         Senior Notes (a "THIRD REMARKETING") on the Third Remarketing Date. By
         11:00 a.m. (New York City time) on the Business Day

                                       43

<PAGE>

         immediately preceding the Third Remarketing Date for such Third
         Remarketing, the Purchase Contract Agent shall notify the Remarketing
         Agent of the aggregate principal amount of Pledged Senior Notes, and
         the Custodial Agent shall notify the Remarketing Agent of the aggregate
         principal amount of Separate Senior Notes (if any) that are to be
         remarketed pursuant to Section 5.02(a)(ii). Concurrently, the
         Collateral Agent, pursuant to the terms of the Pledge Agreement, and
         the Custodial Agent, pursuant to Section 5.02(a)(ii), will present for
         Remarketing the Pledged Senior Notes and the Separate Senior Notes (if
         any) that are to be remarketed to the Remarketing Agent. Upon receipt
         of such notice from the Purchase Contract Agent and the Custodial Agent
         and such Pledged Senior Notes and Separate Senior Notes from the
         Collateral Agent and the Custodial Agent, the Remarketing Agent will,
         on the Third Remarketing Date, use its reasonable efforts to remarket
         (based on the Reset Rate) such Pledged Senior Notes and Separate Senior
         Notes on such date at a price of approximately (but not less than)
         100.50% of the sum of the Treasury Portfolio Purchase Price plus the
         Separate Senior Notes Purchase Price. If the Remarketing Agent is able
         to remarket the Pledged Senior Notes and the Separate Senior Notes at a
         price not less than 100.50% of the Treasury Portfolio Purchase Price
         plus the Separate Senior Notes Purchase Price (a "SUCCESSFUL THIRD
         REMARKETING"), the portion of the proceeds from such Successful Third
         Remarketing equal to the Treasury Portfolio Purchase Price will be
         applied to purchase the Treasury Portfolio. The Remarketing Agent shall
         deduct the Remarketing Fee from any amount of such proceeds in excess
         of the sum of the Treasury Portfolio Purchase Price plus the Separate
         Senior Notes Purchase Price. None of the Company, the Purchase Contract
         Agreement or any Holders of Corporate Units or holders of Separate
         Senior Notes whose Senior Notes or Separate Senior Notes are so
         remarketed will otherwise be responsible for the payment of any
         Remarketing Fee in connection therewith. With respect to Separate
         Senior Notes, the proceeds of the Third Remarketing in excess of the
         Remarketing Fee attributable to the Separate Senior Notes will be
         remitted to the Custodial Agent for payment to the holders of Separate
         Senior Notes. With respect to Pledged Senior Notes, the proceeds of the
         Third Remarketing in excess of the sum of the Treasury Portfolio
         Purchase Price plus the Remarketing Fee with respect to such Pledged
         Senior Notes will be remitted to the Purchase Contract Agent for
         payment to the Holders of the related Corporate Units. The Treasury
         Portfolio will be substituted for the Pledged Senior Notes and the
         appropriate Applicable Ownership Interests (as specified in clause (i)
         of the definition of such term) in the Treasury Portfolio will be
         pledged to the Collateral Agent to secure the obligation of the Holders
         of Corporate Units to pay the Stated Amount for the Common Stock under
         the related Purchase Contracts on the Purchase Contract Settlement
         Date.

         Following the occurrence of a Successful Third Remarketing, the Holders
         of Corporate Units and the Collateral Agent shall have such security
         interests (with respect to the Collateral Agent), rights and
         obligations with respect to the Applicable Ownership Interests (as
         specified in clause (i) of the definition of such term) in the Treasury
         Portfolio as the Holder of Corporate Units and the Collateral Agent had
         in respect of the Senior Notes, subject to the Pledge thereof as
         provided in the Pledge Agreement, and any reference herein or in the
         Certificates to the Senior Notes shall be deemed to be a

                                       44

<PAGE>

         reference to such Applicable Ownership Interests in the Treasury
         Portfolio and any reference herein or in the Certificates to interest
         on the Senior Notes shall be deemed to be a reference to corresponding
         distributions on such Applicable Ownership Interests in the Treasury
         Portfolio. The Company may cause to be made in any Corporate Units
         Certificates thereafter to be issued such change in phraseology and
         form (but not in substance) as may be appropriate to reflect the
         substitution of such Applicable Ownership Interests in the Treasury
         Portfolio for Senior Notes.

         If, in spite of using its reasonable efforts, the Remarketing Agent
         cannot remarket the Pledged Senior Notes and the Separate Senior Notes
         (if any) in a Third Remarketing (other than to the Company) at a price
         not less than 100.50% of the sum of the Treasury Portfolio Purchase
         Price plus the Separate Senior Notes Purchase Price or the Third
         Remarketing is not settled in accordance with the Remarketing Agreement
         for any reason, including the failure to fulfill a condition precedent
         set forth in the Remarketing Agreement, the Third Remarketing will be
         deemed to have failed (a "FAILED THIRD REMARKETING"). Upon a Failed
         Third Remarketing, the Remarketing Agent shall return the Pledged
         Senior Notes and the Separate Senior Notes (if any) subject to such
         Remarketing to the Collateral Agent or the Custodial Agent, as the case
         may be.

                  (c) (i) Unless a Special Event Redemption, an Early Settlement
         or a Cash Merger Early Settlement has occurred prior to the Final
         Remarketing Date, if no Successful Remarketing has occurred prior to
         the Final Remarketing Date, each Holder shall have the right to satisfy
         such Holder's obligations under the Purchase Contract on the Purchase
         Contract Settlement Date in cash by notifying the Purchase Contract
         Agent by use of a notice in substantially the form of Exhibit F hereto
         of its intention to pay in cash ("CASH SETTLEMENT") prior to 5:00 p.m.
         (New York City time) on the fifth Business Day immediately preceding
         the Purchase Contract Settlement Date. Promptly following 5:00 p.m.
         (New York City time) on the fifth Business Day immediately preceding
         the Purchase Contract Settlement Date, the Purchase Contract Agent
         shall notify the Collateral Agent and the Indenture Trustee of the
         receipt of such notices from Holders intending to make a Cash
         Settlement.

                  (ii) A Holder of a Corporate Unit who has so notified the
         Purchase Contract Agent of its intention to effect a Cash Settlement
         shall pay the Stated Amount to the Securities Intermediary for deposit
         in the Collateral Account prior to 5:00 p.m. (New York City time) on
         the fourth Business Day immediately preceding the Purchase Contract
         Settlement Date, in lawful money of the United States by certified or
         cashiers' check or wire transfer, in each case in immediately available
         funds payable to or upon the order of the Securities Intermediary. Any
         cash so received shall be invested promptly by the Securities
         Intermediary in Permitted Investments and paid to the Company on the
         Purchase Contract Settlement Date in settlement of the Purchase
         Contracts in accordance with the terms of this Agreement and the Pledge
         Agreement. Any funds received by the Securities Intermediary in respect
         of the investment earnings from such Permitted Investments in excess of
         the Stated Amount for the shares of Common Stock to be

                                       45

<PAGE>

         purchased by such Holder shall be distributed to the Purchase Contract
         Agent when received for payment to the Holder.

                  (iii) If a Holder of a Corporate Unit does not notify the
         Purchase Contract Agent of its intention to make a Cash Settlement in
         accordance with paragraph 5.02(c)(i) above, or does notify the Purchase
         Contract Agent in accordance with paragraph 5.02(c)(i) above but fails
         to make such payment as required by paragraph 5.02(c)(ii) above, such
         Holder shall be deemed to have consented to the disposition of the
         Pledged Senior Notes pursuant to the Final Remarketing as described in
         paragraph 5.02(d) below.

                  (iv) Promptly after 5:00 p.m. (New York City time) on the
         fourth Business Day preceding the Purchase Contract Settlement Date,
         the Collateral Agent, based on cash payments received by the Securities
         Intermediary pursuant to Section 5.02(c)(ii) hereof, shall promptly
         notify the Purchase Contract Agent and the Indenture Trustee of the
         aggregate principal amount of Senior Notes to be tendered for purchase
         in the Final Remarketing in a notice pursuant to the terms of the
         Pledge Agreement.

                  (d) (i) Unless a Special Event Redemption, an Early Settlement
         or a Cash Merger Early Settlement has occurred prior to the Final
         Remarketing Date, if a Failed Third Remarketing has occurred, the
         Senior Notes of such Holders of Corporate Units who have not notified
         the Purchase Contract Agent of their intention to effect a Cash
         Settlement as provided in paragraph 5.02(c)(i) above, or who have so
         notified the Purchase Contract Agent in accordance with paragraph
         5.02(c)(i) above but have failed to make such payment as required by
         paragraph 5.02(c)(ii) above, and the Separate Senior Notes of any
         holder who has elected for its Separate Senior Notes to be remarketed
         pursuant to Section 5.02(a)(ii) will be sold by the Remarketing Agent
         (the "FINAL REMARKETING") on the third Business Day immediately
         preceding the Purchase Contract Settlement Date (the "FINAL REMARKETING
         DATE"). In order to facilitate the Final Remarketing, the Purchase
         Contract Agent, based on the notices specified in Section 5.02(c)(iv),
         and the Collateral Agent, based on the notices specified in Section
         5.02(a)(ii), shall notify the Remarketing Agent, by 11:00 a.m. (New
         York City time) on the Business Day immediately preceding the Final
         Remarketing Date, of the aggregate principal amount of Pledged Senior
         Notes or aggregate principal amount of Separate Senior Notes that are
         to be remarketed pursuant to Section 5.02(a)(ii), as the case may be,
         to be remarketed. Concurrently, the Collateral Agent, pursuant to the
         terms of the Pledge Agreement, and the Custodial Agent shall cause such
         Pledged Senior Notes and Separate Senior Notes to be presented to the
         Remarketing Agent for Remarketing.

                  (ii) Upon receipt of such notice from the Purchase Contract
         Agent and the Collateral Agent and the Pledged Senior Notes and
         Separate Senior Notes (if any) from the Collateral Agent or Custodial
         Agent, as set forth in clause (i) above, the Remarketing Agent shall,
         on the Final Remarketing Date, use its reasonable efforts to remarket
         (based on the Reset Rate) such Pledged Senior Notes and the Separate
         Senior Notes on such date equal to approximately 100.50% (or, if the
         Remarketing Agent is unable to remarket the Pledged Senior Notes and
         the Separate Senior Notes at such price, at a price

                                       46

<PAGE>

         below 100.50%, but in no event less than 100%, net of the Final
         Remarketing Fee) of the aggregate principal amount of such Senior
         Notes and Separate Senior Notes being remarketed, as provided in the
         Remarketing Agreement. If the Remarketing Agent is able to remarket
         the Senior Notes and Separate Senior Notes at a price equal to or
         greater than 100% (net of the Final Remarketing Fee) of the aggregate
         principal amount of the Senior Notes and Separate Senior Notes (if
         any) (a "SUCCESSFUL FINAL REMARKETING"), the Remarketing Agent will
         remit the proceeds attributable to the Remarketing of the Pledged
         Senior Notes from such Successful Final Remarketing to the Securities
         Intermediary. The Remarketing Agent shall deduct as the remarketing
         fee (the "FINAL REMARKETING FEE") an amount not exceeding 25 basis
         points (0.25%) of the aggregate principal amount of the remarketed
         Pledged Senior Notes and Separate Senior Notes (if any); provided
         that such fee shall be payable out of, and only to the extent of,
         remarketing proceeds, if any, in excess of such amount. With respect
         to Separate Senior Notes, any proceeds of the Final Remarketing in
         excess of the Final Remarketing Fee attributable to the Separate
         Senior Notes will be remitted to the Custodial Agent for payment to
         the holders of Separate Senior Notes. The proceeds from the
         Remarketing remitted to the Securities Intermediary shall be invested
         by the Collateral Agent in Permitted Investments, in accordance with
         the Pledge Agreement, and then applied to satisfy in full the
         obligations of such Holders of Corporate Units to pay the Stated
         Amount for the shares of Common Stock under the related Purchase
         Contracts on the Purchase Contract Settlement Date. Any proceeds in
         excess of those required to pay the Stated Amount and the Final
         Remarketing Fee will be remitted to the Purchase Contract Agent for
         payment to the Holders of the related Corporate Units.

                  (iii) If, in spite of using its reasonable efforts, the
         Remarketing Agent cannot remarket the Pledged Senior Notes and Separate
         Senior Notes (if any) at a price not less than 100% (net of the Final
         Remarketing Fee) of the aggregate principal amount of the Pledged
         Senior Notes and Separate Senior Notes to be remarketed in the Final
         Remarketing (other than to the Company) or the Final Remarketing is not
         settled in accordance with the Remarketing Agreement for any reason,
         including the failure to fulfill a condition precedent set forth in the
         Remarketing Agreement, the remarketing will be deemed to have failed (a
         "FAILED FINAL REMARKETING"). Upon a Failed Final Remarketing, the
         Remarketing Agent shall return the remarketed Pledged Senior Notes and
         Separate Senior Notes (if any) to the Collateral Agent or the Custodial
         Agent, as the case may be. Upon a Failed Final Remarketing, a default
         shall be deemed to have occurred under this Agreement and the Pledge
         Agreement and in accordance with the terms of the Pledge Agreement, the
         Collateral Agent, for the benefit of the Company, shall exercise its
         rights as a secured party with respect to the Pledged Senior Notes,
         including, without limitation, those actions specified in paragraph
         5.02(e) below; provided that if upon a Failed Final Remarketing, the
         Collateral Agent exercises such rights for the benefit of the Company
         with respect to such Senior Notes, any accrued and unpaid interest on
         such Senior Notes shall become payable by the Company to the Purchase
         Contract Agent for payment to the Beneficial Owner of the Corporate
         Units to which such Senior Notes relate.

                                       47

<PAGE>

         (e) With respect to any Pledged Senior Notes that are subject to a
Failed Final Remarketing, and any Senior Notes that are represented by a
Corporate Unit with respect to which the Holder has notified the Purchase
Contract Agent of his intent to effect Cash Settlement and failed to deliver the
Stated Amount pursuant to Section 5.02(c)(ii), in each case resulting in an
event of default under this Agreement, the Collateral Agent for the benefit of
the Company reserves all of its rights as a secured party with respect thereto
and, subject to applicable law and paragraph 5.02(i) below, may, in full
satisfaction of the Holders' obligations under the Purchase Contracts among
other things, (A) retain the Senior Notes in accordance with applicable law or
(B) dispose of the Senior Notes in accordance with applicable law, which in each
case shall constitute payment in full for the aggregate Stated Amount for the
shares of Common Stock to be purchased under the Purchase Contracts.

                  (f) (i) Unless a Holder of a Treasury Unit or a Corporate Unit
         (if the Treasury Portfolio has replaced the Senior Notes represented by
         such Corporate Unit) effects an Early Settlement of the Purchase
         Contract represented by such Unit through the early delivery of cash to
         the Purchase Contract Agent in the manner described in Section 5.07 or
         a Cash Merger Early Settlement of the Purchase Contract represented by
         such Unit through the early delivery of cash to the Purchase Contract
         Agent in the manner described in Section 5.04(b)(2), each Holder of a
         Treasury Unit or a Corporate Unit who intends to effect Cash Settlement
         of the Purchase Contract represented by such Unit shall so notify the
         Purchase Contract Agent by use of a notice in substantially the form of
         Exhibit F hereto prior to 5:00 p.m. (New York City time) on the fifth
         Business Day immediately preceding the Purchase Contract Settlement
         Date. Prior to 11:00 a.m. (New York City time) on the next succeeding
         Business Day, the Purchase Contract Agent shall notify the Collateral
         Agent of the receipt of such notices from such Holders intending to
         make a Cash Settlement. Holders of Treasury Units may make Cash
         Settlements only in integral multiples of 40 Corporate Units.

                  (ii) A Holder of a Treasury Unit or a Corporate Unit (if the
         Treasury Portfolio has replaced the Senior Note represented by such
         Corporate Unit) who has so notified the Purchase Contract Agent of its
         intention to make a Cash Settlement in accordance with paragraph
         5.02(f)(i) above shall pay the Stated Amount to the Securities
         Intermediary for deposit in the Collateral Account prior to 5:00 p.m.
         (New York City time) on the fourth Business Day immediately preceding
         the Purchase Contract Settlement Date, in lawful money of the United
         States by certified or cashiers' check or wire transfer, in each case
         in immediately available funds payable to or upon the order of the
         Securities Intermediary. Any cash received by the Securities
         Intermediary shall be invested promptly by the Collateral Agent in
         Permitted Investments and paid to the Company on the Purchase Contract
         Settlement Date in settlement of the Purchase Contract in accordance
         with the terms of this Agreement and the Pledge Agreement. Any funds
         received by the Securities Intermediary in respect of the investment
         earnings from the investment in such Permitted Investments in excess of
         the Stated Amount for the shares of Common Stock to be purchased by
         such Holder shall be distributed to the Purchase Contract Agent when
         received for payment to the Holder.

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<PAGE>

                  (iii) If a Holder of a Treasury Unit or a Corporate Unit (if
         the Treasury Portfolio has replaced the Senior Note represented by such
         Corporate Unit) fails to notify the Purchase Contract Agent of its
         intention to make a Cash Settlement in accordance with Section
         5.02(f)(i), or does notify the Purchase Contract Agent as provided in
         Section 5.02(f)(i) of its intention to pay the Stated Amount in cash,
         but fails to make such payment as required by Section 5.02(f)(ii), then
         upon the maturity of the Pledged Treasury Securities or the appropriate
         Applicable Ownership Interests (as specified in clause (i) of the
         definition of such term) in the Treasury Portfolio held by the
         Securities Intermediary on or prior to the Business Day immediately
         preceding the Purchase Contract Settlement Date, the principal amount
         of the Treasury Securities or the appropriate Applicable Ownership
         Interests (as specified in clause (i) of the definition of such term)
         in the Treasury Portfolio received by the Collateral Agent shall be
         invested promptly in Permitted Investments. On the Purchase Contract
         Settlement Date, an amount equal to the Stated Amount shall be remitted
         to the Company as payment of such Holder's obligation to pay such
         Stated Amount under the related Purchase Contracts without receiving
         any instructions from the Holder. In the event the sum of the Proceeds
         from related Pledged Treasury Securities or the appropriate Applicable
         Ownership Interests (as specified in clause (i) of the definition of
         such term) in the Treasury Portfolio and the Proceeds from such
         Permitted Investments is in excess of the aggregate Stated Amount, the
         Collateral Agent shall cause the Securities Intermediary to distribute
         such excess to the Purchase Contract Agent for the benefit of the
         Holder of the related Treasury Units or Corporate Units when received.

         (g) Any distribution to Holders of any payments described above shall
be payable at the office of the Purchase Contract Agent in New York City
maintained for that purpose or, at the option of the Holder, by check mailed to
the address of the Person entitled thereto at such address as it appears on the
Security Register.

         (h) Upon Cash Settlement of any Purchase Contract:

                  (i) the Collateral Agent will in accordance with the terms of
         the Pledge Agreement cause the Pledged Senior Notes, the appropriate
         Applicable Ownership Interests (as specified in clause (i) of the
         definition of such term) in the Treasury Portfolio or the Pledged
         Treasury Securities, as the case may be, represented by the relevant
         Units to be released from the Pledge, free and clear of any security
         interest of the Company, and transferred to the Purchase Contract Agent
         for delivery to the Holder thereof or its designee as soon as
         practicable; and

                  (ii) subject to the receipt thereof, the Purchase Contract
         Agent shall, by book-entry transfer or other appropriate procedures, in
         accordance with written instructions provided by the Holder thereof,
         transfer such Senior Notes, or the appropriate Applicable Ownership
         Interests (as specified in clause (i) of the definition of such term)
         in the Treasury Portfolio or such Treasury Securities, as the case may
         be (or, if no such instructions are given to the Purchase Contract
         Agent by the Holder, the Purchase Contract Agent shall hold such Senior
         Notes or the appropriate Applicable Ownership

                                       49

<PAGE>

         Interests (as specified in clause (i) of the definition of such term)
         in the Treasury Portfolio or such Treasury Securities, as the case may
         be, and any interest payment thereon, in the name of the Purchase
         Contract Agent or its nominee in trust for the benefit of such Holder
         until the expiration of the time period specified in the abandoned
         property laws of the relevant state where such property is held).

         (i) The obligations of the Holders to pay the Stated Amount are
non-recourse obligations and, except to the extent satisfied by Early
Settlement, Cash Merger Early Settlement or Cash Settlement, are payable solely
out of the proceeds of any Collateral pledged to secure the obligations of the
Holders, and in no event will Holders be liable for any deficiency between the
proceeds of the disposition of Collateral and the Stated Amount.

         (j) The Company shall not be obligated to issue any shares of Common
Stock in respect of a Purchase Contract or deliver any certificates thereof to
the Holder of the related Units unless the Company shall have received payment
of the Stated Amount for the Common Stock to be purchased thereunder in the
manner herein set forth.

SECTION 5.03. Issuance of Shares of Common Stock. Unless a Termination Event, an
Early Settlement or a Cash Merger Early Settlement shall have occurred, subject
to Section 5.04(b), on the Purchase Contract Settlement Date upon receipt of the
aggregate Stated Amount payable on all Outstanding Units, the Company shall
issue and deposit with the Purchase Contract Agent, for the benefit of the
Holders of the Outstanding Units, one or more certificates representing newly
issued shares of Common Stock registered in the name of the Purchase Contract
Agent (or its nominee) as custodian for the Holders (such certificates for
shares of Common Stock, together with any dividends or distributions for which a
record date and payment date for such dividend or distribution has occurred
after the Purchase Contract Settlement Date, being hereinafter referred to as
the "PURCHASE CONTRACT SETTLEMENT FUND") to which the Holders are entitled
hereunder.

Subject to the foregoing, upon surrender of a Certificate to the Purchase
Contract Agent on or after the Purchase Contract Settlement Date, Early
Settlement Date or Cash Merger Early Settlement Date, as the case may be,
together with settlement instructions thereon duly completed and executed, the
Holder of such Certificate shall be entitled to receive forthwith in exchange
therefor a certificate representing that number of newly issued whole shares of
Common Stock which such Holder is entitled to receive pursuant to the provisions
of this Article Five (after taking into account all Units then held by such
Holder), together with cash in lieu of fractional shares as provided in Section
5.09 and any dividends or distributions with respect to such shares constituting
part of the Purchase Contract Settlement Fund, but without any interest thereon,
and the Certificate so surrendered shall forthwith be cancelled. Such shares
shall be registered in the name of the Holder or the Holder's designee as
specified in the settlement instructions provided by the Holder to the Purchase
Contract Agent. If any shares of Common Stock issued in respect of a Purchase
Contract are to be registered to a Person other than the Person in whose name
the Certificate evidencing such Purchase Contract is registered (but excluding
any Depositary or nominee thereof), no such registration shall be made unless
the Person requesting such registration has paid any transfer and other taxes
required by reason of such registration in a name other than that of the
registered Holder of the Certificate evidencing

                                       50

<PAGE>

such Purchase Contract or has established to the satisfaction of the Company
that such tax either has been paid or is not payable.

SECTION 5.04. Adjustment of Settlement Rate.

         (a) Adjustments for Dividends, Distributions, Stock Splits, Etc.

         (1) In case the Company shall pay or make a dividend or other
distribution on Common Stock in Common Stock, the Settlement Rate in effect at
the close of business on the date fixed for the determination of shareholders
entitled to receive such dividend or other distribution shall be increased by
dividing such Settlement Rate by a fraction of which:

                  (i) the numerator shall be the number of shares of Common
         Stock outstanding at the close of business on the date fixed for such
         determination; and

                  (ii) the denominator shall be the sum of such number of shares
         and the total number of shares constituting such dividend or other
         distribution,

such increase to become effective immediately at the opening of business on the
day following the date fixed for such determination. For the purposes of this
paragraph (1), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company agrees that it shall not pay
any dividend or make any distribution on shares of Common Stock held in the
treasury of the Company.

         (2) In case the Company shall issue rights, warrants or options, other
than pursuant to any dividend reinvestment plans or share purchase plans, to all
holders of its Common Stock (not being available on an equivalent basis to
Holders of the Units upon settlement of the Purchase Contracts represented by
such Units) entitling them, for a period expiring within 45 days after the
record date for the determination of shareholders entitled to receive such
rights, warrants or options, to subscribe for or purchase shares of Common Stock
at a price per share less than the Current Market Price per share of Common
Stock on the date of announcement of such issuance, the Settlement Rate in
effect at the close of business on the date of such announcement shall be
increased by dividing such Settlement Rate by a fraction of which:

                  (i) the numerator shall be the number of shares of Common
         Stock outstanding at the close of business on the date of such
         announcement plus the number of shares of Common Stock that the
         aggregate of the offering price of the total number of shares of Common
         Stock so offered for subscription or purchase would purchase at such
         Current Market Price; and

                  (ii) the denominator shall be the number of shares of Common
         Stock outstanding at the close of business on the date of such
         announcement plus the number of shares of Common Stock so offered for
         subscription or purchase,

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<PAGE>

such increase to become effective immediately after the opening of
business on the Business Day following the date of such announcement. The
Company agrees that it shall notify the Purchase Contract Agent if any issuance
of such rights, warrants or options is cancelled or not completed following the
announcement thereof and the Settlement Rate shall thereupon be readjusted to
the Settlement Rate in effect immediately prior to the date of such
announcement. For the purposes of this paragraph (2), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable in respect of any
scrip certificates issued in lieu of fractions of shares of Common Stock. The
Company agrees that it shall not issue any such rights, warrants or options in
respect of shares of Common Stock held in the treasury of the Company.

         (3) In case outstanding shares of Common Stock shall be subdivided or
split into a greater number of shares of Common Stock, the Settlement Rate in
effect at the close of business on the day preceding the day upon which such
subdivision or split becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall each be combined
into a smaller number of shares of Common Stock, the Settlement Rate in effect
at the close of business on the day preceding the day upon which such
combination becomes effective shall be proportionately reduced, such increase or
reduction, as the case may be, to become effective immediately at the opening of
business on the day following the day upon which such subdivision, split or
combination becomes effective.

         (4) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock evidences of its indebtedness or assets
(including shares of capital stock, securities, cash and property but excluding
any rights, warrants or options referred to in paragraph (2) of this Section
5.04(a), any dividend or distribution paid exclusively in cash and any dividend
or distribution referred to in paragraph (1) of this Section 5.04(a)), the
Settlement Rate in effect at the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution shall be
adjusted by dividing such rate by a fraction of which:

                  (i) the numerator shall be the Current Market Price per share
         of Common Stock on the date fixed for such determination less the then
         fair market value (as reasonably determined by the Board of Directors,
         whose determination shall be conclusive and the basis for which shall
         be described in a Board Resolution) of the portion of the assets or
         evidences of indebtedness so distributed applicable to one share of
         Common Stock; and

                  (ii) the denominator shall be such Current Market Price per
         share of Common Stock,

such adjustment to become effective at the opening of business on the day
following the date fixed for the determination of shareholders entitled to
receive such distribution. In any case in which this paragraph (4) is
applicable, paragraph (2) of this Section 5.04(a) shall not be applicable. In
the event that such dividend or distribution is not so paid or made, the
Settlement Rate shall again be adjusted to be the Settlement Rate that would
then be in effect if such dividend or distribution had not been declared.

                                       52

<PAGE>

         (5) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock cash (excluding any cash that is distributed in
a Reorganization Event to which Section 5.04(b) applies, as part of a
distribution referred to in paragraph (4) of this Section or as a regular
quarterly cash distribution) in an aggregate amount that, combined together with
(I) the aggregate amount of any other distributions (other than regular
quarterly cash distributions) to all holders of its Common Stock made
exclusively in cash within the 12 months preceding the date of payment of such
distribution (the "TRAILING 12 MONTH PERIOD") and in respect of which no
adjustment pursuant to this paragraph (5) or paragraph (6) of this Section has
been made and (II) the aggregate amount of any cash plus the fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of consideration (other than
consideration payable in respect of any odd-lot tender offer) payable in respect
of any tender or exchange offer by the Company or any of its subsidiaries and
calculated as of the expiration of such tender or exchange offer for all or any
portion of the Common Stock concluded within the Trailing 12 Month Period and in
respect of which no adjustment pursuant to this paragraph (5) or paragraph (6)
of this Section has been made, exceeds 10% of the product of the Current Market
Price per share of the Common Stock on the date for the determination of holders
of shares of Common Stock entitled to receive such distribution multiplied by
the number of shares of Common Stock outstanding on such date, then, in such
case, the Settlement Rate in effect at the close of business on such record date
shall be adjusted by dividing such rate by a fraction of which:

                  (i) the numerator shall be the Current Market Price of Common
         Stock on such record date less the amount of cash so distributed (and
         not excluded as provided above) applicable to one share of Common
         Stock; and

                  (ii) the denominator shall be the Current Market Price of
         Common Stock,

such increase to be effective at the opening of business on the day following
the record date; provided, however, that in the event the portion of cash so
distributed applicable to one share of Common Stock is equal to or greater than
the Current Market Price per share of Common Stock on the record date, in lieu
of the foregoing adjustment, adequate provision shall be made so that each
holder of a Unit shall have the right to receive upon settlement of the Units
the amount of cash such Holder would have received had such Holder settled each
Unit on the record date. In the event that such dividend or distribution is not
so paid or made, the Settlement Rate shall again be adjusted to be the
Settlement Rate that would then be in effect if such dividend or distribution
had not been declared.

         (6) If the Company or any subsidiary of the Company shall make a tender
or exchange offer (other than any odd-lot tender offer) for all or any portion
of the Common Stock and upon expiration of such tender or exchange offer (as
amended upon the expiration thereof) the Company or its subsidiary shall be
required to pay to shareholders based on the acceptance (up to any maximum
specified in the terms of the tender or exchange offer) of Purchased Shares (as
herein defined) any consideration, then if the sum of (I) the fair market value
of the aggregate consideration to be paid in such tender offer or exchange offer
(as reasonably determined by the Board of Directors, whose determination shall
be conclusive and the basis for which shall be

                                       53

<PAGE>

described in a Board Resolution) plus (II) the aggregate of the cash plus the
fair market value (as reasonably determined by the Board of Directors, whose
determination shall be conclusive and the basis for which shall be described in
a Board Resolution), as of the expiration of such tender or exchange offer, of
consideration payable in respect of any other tender or exchange offer (other
than consideration payable in respect of any odd-lot tender offer), by the
Company or any subsidiary of the Company for all or any portion of Common Stock
expiring within the 12 months preceding the expiration of such tender or
exchange offer and in respect of which no adjustment pursuant to this paragraph
(6) has been made, plus (III) the aggregate amount of any distributions (other
than regular quarterly cash distributions) to all holders of Common Stock made
exclusively in cash within the 12 months preceding the expiration of such tender
or exchange offer and in respect of which no adjustment pursuant to paragraph
(5) has been made, exceeds 10% of the product of the Current Market Price per
share of Common Stock as of the last time (the "EXPIRATION TIME") tenders could
have been made pursuant to such tender or exchange offer (as it may be amended)
times the number of shares of Common Stock outstanding (including any tendered
shares) at the Expiration Time, then, the Settlement Rate in effect at the close
of business on the day of the Expiration Time shall be adjusted by dividing by a
fraction:

                  (i) the numerator of which shall be equal to (A) the product
         of (I) the Current Market Price per share of Common Stock on the date
         of the Expiration Time and (II) the number of shares of Common Stock
         outstanding (including any tendered shares) on the date of the
         Expiration Time less (B) the amount of cash plus the fair market value
         (determined as aforesaid) of the aggregate consideration payable to
         shareholders based on the transactions described in clauses (I), (II)
         and (III) above (assuming in the case of clause (I) the acceptance, up
         to any maximum specified in the terms of the tender or exchange offer,
         of Purchased Shares); and

                  (ii) the denominator of which shall be equal to the product of
         (A) the Current Market Price per share of Common Stock as of the
         Expiration Time and (B) the number of shares of Common Stock
         outstanding (including any tendered shares) as of the Expiration Time
         less the number of all shares validly tendered and not withdrawn as of
         the Expiration Time (the shares deemed so accepted, up to any such
         maximum, being referred to as the "PURCHASED SHARES"),

such adjustment to become effective at the opening of business on the date
following the date of the Expiration Time.

         (7) The reclassification of Common Stock into securities including
securities other than Common Stock (other than any reclassification upon a
Reorganization Event to which Section 5.04(b) applies) shall be deemed to
involve:

                  (i) a distribution of such securities other than Common Stock
         to all holders of Common Stock (and the effective date of such
         reclassification shall be deemed to be "the date fixed for the
         determination of shareholders entitled to receive such distribution"
         and the "date fixed for such determination" within the meaning of
         paragraph (4) of this Section); and

                                       54

<PAGE>

                  (ii) a subdivision, split or combination, as the case may be,
         of the number of shares of Common Stock outstanding immediately prior
         to such reclassification into the number of shares of Common Stock
         outstanding immediately thereafter (and the effective date of such
         reclassification shall be deemed to be "the day upon which such
         subdivision or split becomes effective" or "the day upon which such
         combination becomes effective", as the case may be, and "the day upon
         which such subdivision, split or combination becomes effective" within
         the meaning of paragraph (3) of this Section).

         (8) The "CURRENT MARKET PRICE" per share of Common Stock on any date of
determination means the average of the daily Closing Prices on each of the
twenty (20) consecutive Trading Days ending on the earlier of such date of
determination and the day before the "ex date" with respect to the issuance or
distribution requiring the computation. For purposes of this paragraph, the term
"ex date," when used with respect to any issuance or distribution, shall mean
the first date on which Common Stock trades regular way on such exchange or in
such market without the right to receive such issuance or distribution.

         (9) All adjustments to the Settlement Rate shall be calculated to the
nearest 1/10,000th of a share of Common Stock (or if there is not a nearest
1/10,000th of a share, to the next lower 1/10,000th of a share). No adjustment
in the Settlement Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent thereof; provided, however, that
any adjustments which by reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.

         (10) The Company may, but shall not be required to, make such increases
in the Settlement Rate, in addition to those required by this Section, as the
Board of Directors considers to be advisable in order to avoid or diminish any
income tax to any holders of shares of Common Stock resulting from any dividend
or distribution of stock or issuance of rights or warrants to purchase or
subscribe for stock or from any event treated as such for income tax purposes or
for any other reason.

(11) The Company has entered into a Rights Agreement dated as of March 12, 1999
(the "RIGHTS AGREEMENT") with EquiServe Trust Company, N.A. pursuant to which
share purchase rights (the "RIGHTS") have been, and may in the future be, issued
in respect of shares of Common Stock. Each share of Common Stock issued upon
settlement of any Purchase Contract pursuant to this Article 5 shall be entitled
to receive the appropriate number of Rights, if any, and the certificates
representing the Common Stock issued upon such settlement shall bear such
legends, if any, in each case as provided by and subject to the terms of the
Rights Agreement as in effect at the time of such settlement. If after the date
of this Agreement the Rights separate from the Common Stock in accordance with
the provisions of the Rights Agreement so that a Holder would not be entitled to
receive any Rights in respect of the Common Stock issuable upon settlement of
such Purchase Contract, the Settlement Rate will be adjusted as provided in this
Section 5.04 on the separation date, subject to readjustment in the event of the
expiration, termination or redemption of the Rights. In lieu of any such
adjustment, the Company may amend the Rights Agreement to provide that upon
settlement Holders will receive, in addition to

                                       55

<PAGE>

the Common Stock issuable upon such settlement, the Rights that would have
attached to such shares of Common Stock if the Rights had not become separated
from the Common Stock pursuant to the provisions of the Rights Agreement. If the
Company hereafter adopts any stockholder rights plan similar to the Rights
Agreement, a Holder shall be entitled to receive upon settlement of its Purchase
Contracts in addition to the shares of Common Stock issuable upon settlement the
related rights for the Common Stock whether or not the rights under the future
stockholder rights plan have separated from the Common Stock at the time of
settlement but otherwise subject to the generally applicable terms of such plan
and no additional adjustment to the Settlement Rate shall be made for the future
stockholder rights plan under this Section 5.04.

         (b) Adjustment for Consolidation, Merger or Other Reorganization Event.

         (1) In the event of:

                  (i) any consolidation or merger of the Company with or into
         another Person (other than a merger or consolidation in which the
         Company is the continuing corporation and in which the shares of Common
         Stock outstanding immediately prior to the merger or consolidation are
         not exchanged for cash, securities or other property of the Company or
         another corporation);

                  (ii) any sale, transfer, lease or conveyance to another Person
         of the property of the Company as an entirety or substantially as an
         entirety;

                  (iii) any statutory share exchange of the Company with another
         Person (other than in connection with a merger or acquisition); or

                  (iv) any liquidation, dissolution or termination of the
         Company other than as a result of or after the occurrence of a
         Termination Event (any event described in clauses (i), (ii), (iii) and
         (iv), a "REORGANIZATION EVENT"),

each Purchase Contract shall become, without the consent of the Holder of the
Unit representing such Purchase Contract, an agreement to purchase only the kind
of securities, cash and other property receivable upon consummation of such
Reorganization Event by a holder of Common Stock immediately prior to the
closing date of such Reorganization Event.

The amount of such securities, cash and other property receivable upon
settlement of each such Purchase Contract after the consummation of the
Reorganization Event shall be based on the value as of such settlement date of
the hypothetical amount of securities, cash and other property that would have
been received upon consummation of the Reorganization Event in exchange for the
maximum number of Common Stock deliverable under a Purchase Contract immediately
prior to the closing date of the Reorganization Event (collectively, the
"EXCHANGE PROPERTY"). In determining the kind and amount of the Exchange
Property pursuant to the foregoing, it will be assumed that such holder of
Common Stock is not a Person with which the Company consolidated or into which
the Company merged or which merged into the Company or to which

                                       56

<PAGE>

such sale or transfer was made, as the case may be (any such Person, a
"CONSTITUENT PERSON"), or an Affiliate of a Constituent Person to the extent
such Reorganization Event provides for different treatment of Common Stock held
by Affiliates of the Company and non-affiliates and such Holder failed to
exercise its rights of election, if any, as to the kind or amount of securities,
cash and other property receivable upon such Reorganization Event (provided that
if the kind or amount of securities, cash and other property receivable upon
such Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("NON-ELECTING SHARE"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each non-electing share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
non-electing shares).

The actual amount of Exchange Property receivable upon settlement of each
Purchase Contract shall be (1) in the case of settlement on the Purchase
Contract Settlement Date or pursuant to Section 5.04(b)(2), a variable amount
based upon the applicable Settlement Rate and the Adjusted Applicable Market
Value of the Exchange Property at such time and (2) in the case of any Early
Settlement, determined in accordance with the procedures described under Section
5.07 using the Settlement Rate that results in the minimum amount of Exchange
Property being delivered under such Purchase Contract.

For purposes of this Section 5.04(b)(1) and Section 5.04(b)(2), the term
"Adjusted Applicable Market Value" shall be deemed to refer to the "Adjusted
Applicable Market Value" of the Exchange Property, and such value shall be
determined (A) with respect to any publicly traded securities that comprise all
or part of the Exchange Property, based on the Closing Price of such securities,
(B) in the case of any cash that comprises all or part of the Exchange Property,
based on the amount of such cash and (C) in the case of any other property that
comprises all or part of the Exchange Property, based on the value of such
property, as determined by a nationally recognized independent investment
banking firm retained by the Company for this purpose; provided that prior to
the separation of the Rights or any similar stockholder rights from the Common
Stock, such Rights or similar stockholder rights shall be deemed to have no
value. The term "Closing Price" shall be deemed to refer to the closing sale
price, last quoted bid price or mid-point of the last bid and ask prices, as the
case may be, of any publicly traded securities that comprise all or part of the
Exchange Property. The term "Trading Day" shall be deemed to refer to any
publicly traded securities that comprise all or part of the Exchange Property.

In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a liquidation, dissolution or termination of the
Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Purchase Contract Agent an agreement
supplemental hereto providing that each Holder of an Outstanding Unit shall have
the rights provided by this Section 5.04(b). Such supplemental agreement shall
provide for adjustments which, for events subsequent to the effective date of
such supplemental agreement, shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Section

                                       57

<PAGE>

5.04. The above provisions of this Section 5.04 shall similarly apply to
successive Reorganization Events.

         (2) In the event of a consolidation or merger of the Company with or
into another Person or any merger of another Person into the Company (other than
a merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock), in each case in which 30%
or more of the total consideration paid to the Company's shareholders consists
of cash or cash equivalents (a "CASH MERGER"), a Holder of a Unit may settle
("CASH MERGER EARLY SETTLEMENT") the Purchase Contract represented by such Unit,
upon the conditions set forth below, at the Settlement Rate in effect
immediately prior to the closing of the Cash Merger; provided that (i) the Cash
Merger Early Settlement Date (as defined below) is no later than the fifth
Business Day immediately preceding the Purchase Contract Settlement Date and
(ii) no Cash Merger Early Settlement will be permitted pursuant to this Section
5.04(b)(2) unless, at the time such Cash Merger Early Settlement is effected,
there is an effective Registration Statement with respect to any securities to
be issued and delivered in connection with such Cash Merger Early Settlement, if
such a Registration Statement is required (in the view of counsel, which need
not be in the form of a written opinion, for the Company) under the Securities
Act. If such a Registration Statement is so required, the Company covenants and
agrees to use commercially reasonable efforts to (A) have in effect a
Registration Statement covering any securities to be delivered in respect of the
Purchase Contracts being settled and (B) provide a Prospectus in connection
therewith, in each case in a form that may be used in connection with such Cash
Merger Early Settlement. If a Holder effects a Cash Merger Early Settlement of
some or all of its Purchase Contracts, such Holder shall be entitled to receive,
on the Cash Merger Early Settlement Date, the aggregate amount of any Deferred
Contract Adjustment Payments and any Accrued and Unpaid Contract Adjustment
Payments since the immediately preceding Payment Date with respect to such
Purchase Contracts. The Company shall pay such amount as a credit against the
amount otherwise payable by the Holders to effect such Cash Merger Early
Settlement.

Within five Business Days of the completion of a Cash Merger, the Company shall
provide written notice to Holders of Units of such completion of a Cash Merger,
which shall specify the deadline for submitting the notice to settle early in
cash pursuant to this Section 5.04(b)(2), the date on which such Cash Merger
Early Settlement shall occur (which date shall be 10 days after the date of such
written notice by the Company, but which shall in no event be later than the
fifth Business Day immediately preceding the Purchase Contract Settlement Date)
(the "CASH MERGER EARLY SETTLEMENT DATE"), the applicable Settlement Rate and
the amount (per share of Common Stock) of cash, securities and other
consideration receivable by the Holder upon settlement, including the amount of
Contract Adjustment Payments receivable upon settlement.

Corporate Units Holders and Treasury Units Holders may only effect Cash Merger
Early Settlement pursuant to this Section 5.04(b)(2) in integral multiples of 40
Corporate Units or Treasury Units, as the case may be. If the Treasury Portfolio
has replaced the Senior Notes represented by the Corporate Units, Corporate
Units Holders may only effect Cash Merger Early Settlement pursuant to this
Section 5.04(b)(2) in multiples of 64,000 Corporate Units. Other than the
provisions relating to timing of notice and settlement, which shall be as set
forth above,

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the provisions of Section 5.01(a) shall apply with respect to a Cash Merger
Early Settlement pursuant to this Section 5.04(b)(2).

In order to exercise the right to effect Cash Merger Early Settlement with
respect to any Purchase Contracts, the Holder of the Certificate evidencing
Units shall deliver, no later than 5:00 p.m. (New York City time) on the third
Business Day immediately preceding the Cash Merger Early Settlement Date, such
Certificate to the Purchase Contract Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount equal to
the product of (A) the Stated Amount times (B) the number of Purchase Contracts
with respect to which the Holder has elected to effect Cash Merger Early
Settlement, less the amount of any Contract Adjustment Payments payable to the
Holder on the Cash Merger Early Settlement Date.

If a Holder properly effects an effective Cash Merger Early Settlement in
accordance with the provisions of this Section 5.04(b)(2), the Company will
deliver (or will cause the Collateral Agent to deliver) to the Holder on the
Cash Merger Early Settlement Date:

                  (i) the kind and amount of securities, cash and other property
         receivable upon such Cash Merger by a Holder of the number of shares of
         Common Stock issuable on account of each Purchase Contract if the
         Purchase Contract Settlement Date had occurred immediately prior to
         such Cash Merger (based on the Settlement Rate in effect at such time),
         assuming such Holder of Common Stock is not a Constituent Person or an
         Affiliate of a Constituent Person to the extent such Cash Merger
         provides for different treatment of Common Stock held by Affiliates of
         the Company and non-affiliates and such Holder failed to exercise its
         rights of election, if any, as to the kind or amount of securities,
         cash and other property receivable upon such Cash Merger (provided that
         if the kind or amount of securities, cash and other property receivable
         upon such Cash Merger is not the same for each non-electing share, then
         for the purpose of this Section 5.04(b)(2), the kind and amount of
         securities, cash and other property receivable upon such Cash Merger by
         each non-electing share shall be deemed to be the kind and amount so
         receivable per share by a plurality of the non-electing shares). For
         the avoidance of doubt, for the purposes of determining the Adjusted
         Applicable Market Value (in connection with determining the appropriate
         Settlement Rate to be applied in the foregoing sentence), the date of
         the closing of the Cash Merger shall be deemed to be the Purchase
         Contract Settlement Date;

                  (ii) the Senior Notes, the Applicable Ownership Interests in
         the Treasury Portfolio or Treasury Securities, as the case may be,
         related to the Purchase Contracts with respect to which the Holder is
         effecting a Cash Merger Early Settlement; and

                  (iii) if so required under the Securities Act, a Prospectus as
         contemplated by this Section 5.04(b)(2).

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         (c) All calculations and determinations pursuant to this Section 5.04
shall be made by the Company or its agent and the Purchase Contract Agent shall
have no responsibility with respect thereto.

         (d) The Corporate Units or the Treasury Units of the Holders who do not
elect Cash Merger Early Settlement in accordance with the foregoing will
continue to remain outstanding and be subject to settlement on the Purchase
Contract Settlement Date in accordance with the terms hereof.

SECTION 5.05. Notice of Adjustments and Certain Other Events.

         (a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall within 10 Business Days following the occurrence of an event that
requires an adjustment to the Settlement Rate pursuant to Section 5.04 (or if
the Company is not aware of such occurrence, as soon as practicable after
becoming so aware):

                  (i) compute the adjusted Settlement Rate in accordance with
         Section 5.04 and prepare and transmit to the Purchase Contract Agent an
         Officers' Certificate setting forth the Settlement Rate, the method of
         calculation thereof in reasonable detail, and the facts requiring such
         adjustment and upon which such adjustment is based; and

                  (ii) provide a written notice to the Holders of the Units of
         the occurrence of such event and a statement in reasonable detail
         setting forth the method by which the adjustment to the Settlement Rate
         was determined and setting forth the adjusted Settlement Rate.

         (b) The Purchase Contract Agent shall not at any time be under any duty
or responsibility to any Holder of Units to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to the
nature or extent or calculation of any such adjustment when made, or with
respect to the method employed in making the same. The Purchase Contract Agent
shall be fully authorized and protected in relying on any Officers' Certificate
delivered pursuant to Section 5.05(a)(i) and any adjustment contained therein
and the Purchase Contract Agent shall not be deemed to have knowledge of any
adjustment unless and until it has received such certificate. The Purchase
Contract Agent shall not be accountable with respect to the validity or value
(or the kind or amount) of any shares of Common Stock, or of any securities or
property, which may at the time be issued or delivered with respect to any
Purchase Contract; and the Purchase Contract Agent makes no representation with
respect thereto. The Purchase Contract Agent shall not be responsible for any
failure of the Company to issue, transfer or deliver any shares of Common Stock
pursuant to a Purchase Contract or to comply with any of the duties,
responsibilities or covenants of the Company contained in this Article.

SECTION 5.06. Termination Event; Notice.

The Purchase Contracts and all obligations and rights of the Company and the
Holders thereunder, including, without limitation, the rights of the Holders to
receive and the obligation

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of the Company to pay any Contract Adjustment Payments (including any accrued
and unpaid Contract Adjustment Payments and any Deferred Contract Adjustment
Payments), if the Company shall have such obligation, and the rights and
obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Purchase Contract Agent or the Company, if, prior to or on the
Purchase Contract Settlement Date, a Termination Event shall have occurred.

Upon and after the occurrence of a Termination Event, the Units shall thereafter
represent solely the right to receive the Senior Notes, the Treasury Securities
or the appropriate Applicable Ownership Interests in the Treasury Portfolio, as
the case may be, represented by such Units, in accordance with the provisions of
Section 5.04 of the Pledge Agreement. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register.

SECTION 5.07. Early Settlement. (a) Subject to and upon compliance with the
provisions of this Section 5.07, at the option of the Holder thereof, Purchase
Contracts represented by Units may be settled early ("EARLY SETTLEMENT") at any
time prior to 5:00 p.m. (New York City time) on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date; provided that no
Early Settlement will be permitted pursuant to this Section 5.07 unless, at the
time such Early Settlement is effected, there is an effective Registration
Statement with respect to any securities to be issued and delivered in
connection with such Early Settlement, if such a Registration Statement is
required (in the view of counsel, which need not be in the form of a written
opinion, for the Company) under the Securities Act. If such a Registration
Statement is so required, the Company covenants and agrees to use commercially
reasonable efforts to (A) have in effect a Registration Statement covering any
securities to be delivered in respect of the Purchase Contracts being settled
and (B) provide a Prospectus in connection therewith, in each case in a form
that may be used in connection with such Early Settlement.

         (b) In order to exercise the right to effect Early Settlement with
respect to any Purchase Contracts, the Holder of the Certificate evidencing
Units shall deliver, at any time prior to 5:00 a.m. (New York City time) on the
fifth Business Day immediately preceding the Purchase Contract Settlement Date,
such Certificate to the Purchase Contract Agent at the Corporate Trust Office
duly endorsed for transfer to the Company or in blank with the form of Election
to Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount (the "EARLY
SETTLEMENT AMOUNT") equal to:

                  (i) the sum of (A) the product of (I) the Stated Amount, times
         (II) the number of Purchase Contracts with respect to which the Holder
         has elected to effect Early Settlement, plus (B) if such delivery is
         made with respect to any Purchase Contracts during the period from the
         close of business on any Record Date next preceding any Payment Date to
         the opening of business on such Payment Date, an amount equal to the
         Contract Adjustment Payments payable on such Payment Date with respect
         to such Purchase Contracts, less

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                  (ii) the amount of any Deferred Contract Adjustment Payments
         payable to such Holder as a result of such Early Settlement.

Except as provided in the immediately preceding sentence, no payment shall be
made upon Early Settlement of any Purchase Contract on account of any Contract
Adjustment Payments accrued on such Purchase Contract since the immediately
preceding Payment Date or on account of any dividends on the Common Stock issued
upon such Early Settlement. However, a Holder effecting an Early Settlement of
some or all of its Purchase Contracts shall be entitled to receive, on the date
it receives the shares of Common Stock referred to in Section 5.07(d), the
amount of any Deferred Contract Adjustment Payments with respect to such
Purchase Contracts, calculated as of the immediately preceding Payment Date. The
amount of such Deferred Contract Adjustment Payments shall be credited against
the amount otherwise payable by the Holder to effect such Early Settlement as
set forth in clause (ii) above. If the foregoing requirements are first
satisfied with respect to Purchase Contracts represented by any Units at or
prior to 5:00 p.m. (New York City time) on a Business Day, such day shall be the
"EARLY SETTLEMENT DATE" with respect to such Units and if such requirements are
first satisfied after 5:00 p.m. (New York City time) on a Business Day or on a
day that is not a Business Day, the "EARLY SETTLEMENT DATE" with respect to such
Units shall be the next succeeding Business Day.

Upon the receipt of such Certificate and Early Settlement Amount from the
Holder, the Purchase Contract Agent shall pay to the Company such Early
Settlement Amount, the receipt of which payment the Company shall confirm in
writing. The Purchase Contract Agent shall then, in accordance with Section 5.06
of the Pledge Agreement, notify the Collateral Agent that (A) such Holder has
elected to effect an Early Settlement, which notice shall set forth the number
of such Purchase Contracts as to which such Holder has elected to effect Early
Settlement, (B) the Purchase Contract Agent has received from such Holder, and
paid to the Company as confirmed in writing by the Company, the related Early
Settlement Amount and (C) all conditions to such Early Settlement have been
satisfied.

Holders of Treasury Units may only effect Early Settlement pursuant to this
Section 5.07 in integral multiples of 40 Treasury Units. If the Treasury
Portfolio has replaced the Senior Notes represented by the Corporate Units,
Corporate Units Holders may only effect Early Settlement pursuant to this
Section 5.07 in integral multiples of 64,000 Corporate Units.

Upon Early Settlement of the Purchase Contracts, the rights of the Holders to
receive and the obligation of the Company to pay any accrued and unpaid Contract
Adjustment Payments since the immediately preceding Payment Date and any future
Contract Adjustment Payments with respect to such Purchase Contracts shall
immediately and automatically terminate.

         (c) Upon Early Settlement of Purchase Contracts by a Holder of the
related Units, the Company shall issue, and the Holder shall be entitled to
receive, 0.3501 shares of Common Stock on account of each Purchase Contract as
to which Early Settlement is effected (the "EARLY SETTLEMENT RATE"). The Early
Settlement Rate shall be adjusted in the same manner and at the same time as the
Settlement Rate is adjusted pursuant to Section 5.04.

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         (d) No later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause:

                  (i) the shares of Common Stock issuable upon Early Settlement
         of Purchase Contracts to be issued and delivered, together with payment
         in lieu of any fraction of a share, as provided in Section 5.09; and

                  (ii) the related Senior Notes or the Applicable Ownership
         Interests in the Treasury Portfolio, as applicable, in the case of
         Corporate Units, or the related Treasury Securities, in the case of
         Treasury Units, to be released from the Pledge by the Collateral Agent
         and transferred, in each case, to the Purchase Contract Agent for
         delivery to the Holder thereof or its designee.

         (e) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Senior Notes, the
Applicable Ownership Interests in the Treasury Portfolio or Treasury Securities,
as the case may be, from the Securities Intermediary, as applicable, the
Purchase Contract Agent shall, in accordance with the instructions provided by
the Holder thereof on the applicable form of Election to Settle Early on the
reverse of the Certificate evidencing the related Units:

                  (i) transfer to the Holder the Senior Notes, the Applicable
         Ownership Interests in the Treasury Portfolio or Treasury Securities,
         as the case may be, represented by such Units,

                  (ii) deliver to the Holder a certificate or certificates for
         the full number of shares of Common Stock issuable upon such Early
         Settlement, together with payment in lieu of any fraction of a share,
         as provided in Section 5.09, and

                  (iii) if so required under the Securities Act, deliver a
         Prospectus for the shares of Common Stock issuable upon such Early
         Settlement as contemplated by Section 5.07(a).

         (f) In the event that Early Settlement is effected with respect to
Purchase Contracts represented by less than all the Units evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the
Purchase Contract Agent shall execute on behalf of the Holder, authenticate and
deliver to the Holder thereof, at the expense of the Company, a Certificate
evidencing the Units as to which Early Settlement was not effected.

         (g) A Holder of a Unit who effects Early Settlement may elect to have
the Senior Notes no longer represented by a Corporate Unit remarketed in
accordance with the provisions of Section 5.02.

SECTION 5.08. Intentionally Omitted.

SECTION 5.09. No Fractional Shares.

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No fractional shares or scrip representing fractional shares of Common Stock
shall be issued or delivered upon settlement on the Purchase Contract Settlement
Date, or upon Early Settlement or Cash Merger Early Settlement of any Purchase
Contracts. If Certificates evidencing more than one Purchase Contract shall be
surrendered for settlement at one time by the same Holder, the number of full
shares of Common Stock that shall be delivered upon settlement shall be computed
on the basis of the aggregate number of Purchase Contracts evidenced by the
Certificates so surrendered. Instead of any fractional share of Common Stock
that would otherwise be deliverable upon settlement of any Purchase Contracts on
the Purchase Contract Settlement Date, or upon Early Settlement or Cash Merger
Early Settlement, the Company, through the Purchase Contract Agent, shall make a
cash payment in respect of such fractional interest in an amount equal to the
percentage of such fractional share times the Applicable Market Value calculated
as if the date of such settlement were the Purchase Contract Settlement Date.
The Company shall provide the Purchase Contract Agent from time to time with
sufficient funds to permit the Purchase Contract Agent to make all cash payments
required by this Section 5.09 in a timely manner.

SECTION 5.10. Charges and Taxes.

The Company will pay all stock transfer and similar taxes attributable to the
initial issuance and delivery of the shares of Common Stock pursuant to the
Purchase Contracts; provided, however, that the Company shall not be required to
pay any such tax or taxes which may be payable in respect of any exchange of or
substitution for a Certificate evidencing a Unit or any issuance of a share of
Common Stock in a name other than that of the registered Holder of a Certificate
surrendered in respect of the Units evidenced thereby, other than in the name of
the Purchase Contract Agent, as custodian for such Holder, and the Company shall
not be required to issue or deliver such share certificates or Certificates
unless or until the Person or Persons requesting the transfer or issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid.

SECTION 5.11. Contract Adjustment Payments.

         (a) Subject to Section 5.11(d) and Section 5.12, the Company shall pay,
on each Payment Date, the Contract Adjustment Payments payable in respect of
each Purchase Contract to the Person in whose name a Certificate is registered
at the close of business on the Record Date relating to such Payment Date. The
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in the Borough of Manhattan, New York City maintained for that
purpose. If the book-entry system for the Units has been terminated, the
Contract Adjustment Payments will be payable, at the option of the Company, by
check mailed to the address of the Person entitled thereto at such Person's
address as it appears on the Security Register, or by wire transfer to the
account designated by such Person by a prior written notice to the Purchase
Contract Agent. If any date on which Contract Adjustment Payments are to be made
is not a Business Day, then payment of the Contract Adjustment Payments payable
on such date will be made on the next succeeding day that is a Business Day (and
without any interest in respect of any such delay); provided that if such
Business Day is in the next succeeding calendar year, then payment of the
Contract Adjustment Payments will be made on the Business Day

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<PAGE>

immediately preceding such Business Day. Contract Adjustment Payments payable
for any period will be computed on the basis of a 360-day year of twelve 30-day
months. The Contract Adjustment Payments will accrue from June 24, 2003.

         (b) Upon the occurrence of a Termination Event, the Company's
obligation to pay future Contract Adjustment Payments (including any accrued
Contract Adjustment Payments and any Deferred Contract Adjustment Payments)
shall cease.

         (c) Each Certificate delivered under this Agreement upon registration
of transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the recreation of Corporate Units) any other
Certificate shall carry the right to accrued and unpaid Contract Adjustment
Payments and Deferred Contract Adjustment Payments, which right was carried by
the Purchase Contracts represented by such other Certificates.

         (d) In the case of any Unit with respect to which Early Settlement or
Cash Merger Early Settlement of the Purchase Contract represented by such Unit
is effected on a date that is after any Record Date and prior to or on the next
succeeding Payment Date, Contract Adjustment Payments otherwise payable on such
Payment Date shall be payable on such Payment Date notwithstanding such Early
Settlement or Cash Merger Early Settlement, and such Contract Adjustment
Payments shall be paid to the Person in whose name the Certificate evidencing
such Unit is registered at the close of business on such Record Date. Except as
otherwise expressly provided in the immediately preceding sentence, in the case
of any Unit with respect to which Early Settlement or Cash Merger Early
Settlement of the Purchase Contract represented by such Unit is effected,
Contract Adjustment Payments that would otherwise be payable after the Early
Settlement or Cash Merger Early Settlement Date with respect to such Purchase
Contract shall not be payable.

         (e) The Company's obligations with respect to Contract Adjustment
Payments, if any, will be subordinated and junior in right of payment to the
Company's obligations under any Indebtedness.

         (f) In the event (x) of any payment by, or distribution of assets of,
the Company of any kind or character, whether in cash, property or securities,
to creditors upon any dissolution, winding-up, liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, or (y) subject to the provisions of Section
5.11(h) below, that (i) a default shall have occurred and be continuing with
respect to the payment of principal, interest or any other monetary amounts due
and payable on any Indebtedness and such default shall have continued beyond the
period of grace, if any, specified in the instrument evidencing such
Indebtedness (and the Purchase Contract Agent shall have received written notice
thereof from the Company or one or more holders of Indebtedness or their
representative or representatives or the trustee or trustees under any indenture
pursuant to which any such Indebtedness may have been issued), or (ii) the
maturity of any Indebtedness shall have been accelerated because of a default in
respect of such Indebtedness (and the Purchase Contract Agent shall have
received written notice thereof from the Company or one or more holders of

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<PAGE>

Indebtedness or their representative or representatives or the trustee or
trustees under any indenture pursuant to which any such Indebtedness may have
been issued), then:

                  (i) the holders of all Indebtedness shall first be entitled to
         receive, in the case of clause (x) above, payment of all amounts due or
         to become due upon all Indebtedness and, in the case of subclauses (i)
         and (ii) of clause (y) above, payment of all amounts due thereon, or
         provision shall be made for such payment in money or money's worth,
         before the Holders of any of the Units are entitled to receive any
         Contract Adjustment Payments on the Purchase Contracts represented by
         the Units;

                  (ii) any payment by, or distribution of assets of, the Company
         of any kind or character, whether in cash, property or securities, to
         which the Holders of any of the Units would be entitled except for the
         provisions of Section 5.11(e) through (q), shall be paid or delivered
         by the Person making such payment or distribution, whether a trustee in
         bankruptcy, a receiver or liquidating trustee or otherwise, directly to
         the representative or representatives of the holders of Indebtedness or
         to the trustee or trustees under any indenture under which any
         instruments evidencing any of such Indebtedness may have been issued,
         ratably according to the aggregate amounts remaining unpaid on account
         of such Indebtedness held or represented by each, to the extent
         necessary to make payment in full of all Indebtedness remaining unpaid
         after giving effect to any concurrent payment or distribution (or
         provision therefor) to the holders of such Indebtedness, before any
         payment or distribution is made of such Contract Adjustment Payments to
         the Holders of such Units; and

                  (iii) in the event that, notwithstanding the foregoing, any
         payment by, or distribution of assets of, the Company of any kind or
         character, whether in cash, property or securities, shall be received
         by the Purchase Contract Agent or the Holders of any of the Units when
         such payment or distribution is prohibited pursuant to Section 5.11(e)
         through (q), such payment or distribution shall be paid over to the
         representative or representatives of the holders of Indebtedness or to
         the trustee or trustees under any indenture pursuant to which any
         instruments evidencing any such Indebtedness may have been issued,
         ratably as aforesaid, for application to the payment of all
         Indebtedness remaining unpaid until all such Indebtedness shall have
         been paid in full, after giving effect to any concurrent payment or
         distribution (or provision therefor) to the holders of such
         Indebtedness.

         (g) For purposes of Section 5.11(e) through (q), the words "cash,
property or securities" shall not be deemed to include shares of stock of the
Company as reorganized or readjusted, or securities of the Company or any other
Person provided for by a plan of reorganization or readjustment, the payment of
which is subordinated at least to the extent provided in Section 5.11(e) through
(q) with respect to such Contract Adjustment Payments on the Units to the
payment of all Indebtedness which may at the time be outstanding; provided that
(i) the indebtedness or guarantee of indebtedness, as the case may be, that
constitutes Indebtedness is assumed by the Person, if any, resulting from any
such reorganization or readjustment, and (ii)

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<PAGE>

the rights of the holders of the Indebtedness are not, without the consent of
each such holder adversely affected thereby, altered by such reorganization or
readjustment;

         (h) Any failure by the Company to make any payment on or perform any
other obligation under Indebtedness, other than any indebtedness incurred by the
Company or assumed or guaranteed, directly or indirectly, by the Company for
money borrowed (or any deferral, renewal, extension or refunding thereof) or any
indebtedness or obligation as to which the provisions of Section 5.11(e) through
(g) shall have been waived by the Company in the instrument or instruments by
which the Company incurred, assumed, guaranteed or otherwise created such
indebtedness or obligation, shall not be deemed a default or event of default if
(i) the Company shall be disputing its obligation to make such payment or
perform such obligation and (ii) either (A) no final judgment relating to such
dispute shall have been issued against the Company which is in full force and
effect and is not subject to further review, including a judgment that has
become final by reason of the expiration of the time within which a party may
seek further appeal or review, and (B) in the event a judgment that is subject
to further review or appeal has been issued, the Company shall in good faith be
prosecuting an appeal or other proceeding for review and a stay of execution
shall have been obtained pending such appeal or review.

         (i) Subject to the irrevocable payment in full of all Indebtedness, the
Holders of the Units shall be subrogated (equally and ratably with the holders
of all obligations of the Company which by their express terms are subordinated
to Indebtedness of the Company to the same extent as payment of the Contract
Adjustment Payments in respect of the Purchase Contracts represented by the
Units is subordinated and which are entitled to like rights of subrogation) to
the rights of the holders of Indebtedness to receive payments or distributions
of cash, property or securities of the Company applicable to the Indebtedness
until all such Contract Adjustment Payments owing on the Units shall be paid in
full, and as between the Company, its claimholders other than holders of such
Indebtedness and the Holders, no such payment or distribution made to the
holders of Indebtedness by virtue of Section 5.11(e) through (q) that otherwise
would have been made to the Holders shall be deemed to be a payment by the
Company on account of such Indebtedness, it being understood that the provisions
of Section 5.11(e) through (q) are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders of
Indebtedness, on the other hand.

         (j) Nothing contained in Section 5.11(e) through (q) or elsewhere in
this Agreement or in the Units is intended to or shall impair, as among the
Company, its claimholders other than the holders of Indebtedness and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders such Contract Adjustment Payments on the Units as and when
the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and claimholders
of the Company other than the holders of Indebtedness, nor shall anything herein
or therein prevent the Purchase Contract Agent or any Holder from exercising all
remedies otherwise permitted by applicable law upon default under this
Agreement, subject to the rights, if any, under Section 5.11(e) through (q), of
the holders of Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.

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         (k) Upon payment or distribution of assets of the Company referred to
in Section 5.11(e) through (q), the Purchase Contract Agent and the Holders
shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which any such dissolution, winding up, liquidation or
reorganization proceeding affecting the affairs of the Company is pending or
upon a certificate of the trustee in bankruptcy, receiver, assignee for the
benefit of creditors, liquidating trustee or Purchase Contract Agent or other
person making any payment or distribution, delivered to the Purchase Contract
Agent or to the Holders, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Indebtedness and
other indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to these Section 5.11(e) through (q).

         (l) The Purchase Contract Agent shall be entitled to rely on the
delivery to it of a written notice by a Person representing himself to be a
holder of Indebtedness (or a trustee or representative on behalf of such holder)
to establish that such notice has been given by a holder of Indebtedness or a
trustee or representative on behalf of any such holder or holders. In the event
that the Purchase Contract Agent determines in good faith that further evidence
is required with respect to the right of any Person as a holder of Indebtedness
to participate in any payment or distribution pursuant to Section 5.11(e)
through (q), the Purchase Contract Agent may request such Person to furnish
evidence to the reasonable satisfaction of the Purchase Contract Agent as to the
amount of Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under Section 5.11(e) through (q), and,
if such evidence is not furnished, the Purchase Contract Agent may defer payment
to such Person pending judicial determination as to the right of such Person to
receive such payment.

         (m) Nothing contained in Section 5.11(e) through (q) shall affect the
obligations of the Company to make, or prevent the Company from making, payment
of the Contract Adjustment Payments, except as otherwise provided in these
Section 5.11(e) through (q).

         (n) Each Holder of Units, by its acceptance thereof, authorizes and
directs the Purchase Contract Agent on its behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in Section
5.11 (e) through (q) and appoints the Purchase Contract Agent its
attorney-in-fact, as the case may be, for any and all such purposes.

         (o) The Company shall give prompt written notice to the Purchase
Contract Agent of any fact known to the Company that would prohibit the making
of any payment of moneys to or by the Purchase Contract Agent in respect of the
Units pursuant to the provisions of this Section. Notwithstanding the provisions
of Section 5.11(e) through (q) or any other provisions of this Agreement, the
Purchase Contract Agent shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment of moneys to or by the
Purchase Contract Agent, or the taking of any other action by the Purchase
Contract Agent, unless and until the Purchase Contract Agent shall have received
written notice thereof mailed or delivered to the Purchase Contract Agent from
the Company, any Holder, or the holder or representative of

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any Indebtedness; provided that if at least two Business Days prior to the date
upon which by the terms hereof any such moneys may become payable for any
purpose, the Purchase Contract Agent shall not have received with respect to
such moneys the notice provided for in this Section, then, anything herein
contained to the contrary notwithstanding, the Purchase Contract Agent shall
have full power and authority to receive such moneys and to apply the same to
the purpose for which they were received and shall not be affected by any notice
to the contrary that may be received by it within two Business Days prior to or
on or after such date.

         (p) The Purchase Contract Agent in its individual capacity shall be
entitled to all the rights set forth in this Section with respect to any
Indebtedness at the time held by it, to the same extent as any other holder of
Indebtedness and nothing in this Agreement shall deprive the Purchase Contract
Agent of any of its rights as such holder.

         (q) No right of any present or future holder of any Indebtedness to
enforce the subordination herein shall at any time or in any way be prejudiced
or impaired by any act or failure to act on the part of the Company or by any
noncompliance by the Company with the terms, provisions and covenants of this
Agreement, regardless of any knowledge thereof which any such holder may have or
be otherwise charged with.

         (r) Nothing in this Section 5.11 shall apply to claims of, or payments
to, the Purchase Contract Agent under or pursuant to Section 7.07.

         (s) With respect to the holders of Indebtedness, (i) the duties and
obligations of the Purchase Contract Agent shall be determined solely by the
express provisions of this Agreement; (ii) the Purchase Contract Agent shall not
be liable to any such holders if it shall, acting in good faith, mistakenly pay
over or distribute to the Holders or to the Company or any other Person cash,
property or securities to which any holders of Indebtedness shall be entitled by
virtue of this Section 5.11 or otherwise; (iii) no implied covenants or
obligations shall be read into this Agreement against the Purchase Contract
Agent; and (iv) the Purchase Contract Agent shall not be deemed to be a
fiduciary as to such holders.

        SECTION 5.12. Deferral of Contract Adjustment Payments. (a) The Company
has the right to defer payment of all or part of the Contract Adjustment
Payments in respect of each Purchase Contract until no later than the Purchase
Contract Settlement Date (or, in the event of an effective Early Settlement or
Cash Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be), but only if the Company shall give the
Holders and the Purchase Contract Agent written notice of its election to defer
such payment (specifying the amount to be deferred) at least ten Business Days
prior to the earlier of (i) the next succeeding Payment Date or (ii) the date
the Company is required to give notice of the Record Date or Payment Date with
respect to payment of such Contract Adjustment Payments to the NYSE or other
applicable self-regulatory organization or to Holders, but in any event not less
than one Business Day prior to such Record Date. If the Company so elects to
defer Contract Adjustment Payments, the Company shall pay additional Contract
Adjustment Payments on such deferred installments of Contract Adjustment

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Payments at a rate equal to 7.00% per annum, compounding on each succeeding
Payment Date, until such deferred installments are paid in full (such deferred
installments of Contract Adjustment Payments together with the accrued
additional Contract Adjustment Payments thereon, being referred to herein as the
"DEFERRED CONTRACT ADJUSTMENT PAYMENTS"). Deferred Contract Adjustment Payments
shall be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to this Section.

         (b) In the event that the Company elects to defer the payment of
Contract Adjustment Payments on the Purchase Contracts until the Purchase
Contract Settlement Date (or, in the event of an effective Early Settlement or
Cash Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be), each Holder will receive on the Purchase
Contract Settlement Date, Early Settlement Date or Cash Merger Early Settlement
Date, as applicable, the aggregate amount of Deferred Contract Adjustment
Payments to the extent such amounts are not deducted from the Stated Amount in
the case of a Cash Settlement, any Early Settlement or any Cash Merger Early
Settlement. The Company shall pay such amount on the Purchase Contract
Settlement Date (or, in the event of an effective Early Settlement or Cash
Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be) in the manner described in Section 5.11(a).

         (c) In the event the Company exercises its option to defer the payment
of Contract Adjustment Payments, then, until all Deferred Contract Adjustment
Payments have been paid, the Company shall not, and shall not permit any of its
subsidiaries to, declare or pay dividends on, make distributions with respect
to, or redeem, purchase or acquire, or make a liquidation payment with respect
to, any of its capital stock or their capital stock; provided that the Company's
subsidiaries will not be restricted from declaring or paying such dividends, or
making such distributions, to the Company or any of the Company's other
subsidiaries as a result of the foregoing.

                                   ARTICLE 6

                                    REMEDIES

         SECTION 6.01. Unconditional Right of Holders to Receive Contract
Adjustment Payments and to Purchase Shares of Common Stock.

         Each Holder of a Unit shall have the right, which is absolute and
unconditional, (i) subject to Article 5, to receive each Contract Adjustment
Payment with respect to the Purchase Contract represented by such Unit on the
applicable Payment Date and (ii) except upon and following a Termination Event,
to purchase shares of Common Stock pursuant to such Purchase Contract and, in
each such case, to institute suit for the enforcement of any such right to
receive

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Contract Adjustment Payments and the right to purchase shares of Common Stock,
and such rights shall not be impaired without the consent of such Holder.

         SECTION 6.02. Restoration of Rights and Remedies.

         If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder, and thereafter all rights and remedies of such
Holder shall continue as though no such proceeding had been instituted.

         SECTION 6.03. Rights and Remedies Cumulative.

         Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy herein conferred upon or reserved to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.

         SECTION 6.04. Delay or Omission Not Waiver.

         No delay or omission of any Holder to exercise any right upon a default
or remedy upon a default shall impair any such right or remedy or constitute a
waiver of any such right. Every right and remedy given by this Article or by law
to the Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.

         SECTION 6.05. Undertaking for Costs.

         All parties to this Agreement agree, and each Holder of a Unit, by its
acceptance of such Unit shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Agreement, or in any suit against the Purchase Contract Agent for any
action taken, suffered or omitted by it as Purchase Contract Agent, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and costs against any party litigant in
such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; provided that the provisions of this
Section shall not apply to any suit instituted by the Purchase Contract Agent,
to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Units, or to any suit instituted by
any Holder for the enforcement of interest on any Senior Notes or Contract
Adjustment Payments on or after the respective Payment Date therefor in respect
of any Unit held by such Holder, or for enforcement of the right to purchase
shares of Common Stock under the Purchase Contracts represented by any Unit held
by such Holder.

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         SECTION 6.06. Waiver of Stay or Extension Laws.

         The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Purchase Contract Agent or the Holders, but will
suffer and permit the execution of every such power as though no such law had
been enacted.

                                   ARTICLE 7

                          THE PURCHASE CONTRACT AGENT

         SECTION 7.01. Certain Duties and Responsibilities.

         (a) The Purchase Contract Agent:

         (1) undertakes to perform, with respect to the Units, such duties and
only such duties as are specifically set forth in this Agreement, the Pledge
Agreement and the Remarketing Agreement and no implied covenants or obligations
shall be read into this Agreement, the Pledge Agreement or the Remarketing
Agreement against the Purchase Contract Agent; and

         (2) in the absence of bad faith or gross negligence on its part, may,
with respect to the Units, conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Purchase Contract Agent and conforming to the
requirements of this Agreement or the Pledge Agreement or the Remarketing
Agreement, as applicable, but in the case of any certificates or opinions which
by any provision hereof are specifically required to be furnished to the
Purchase Contract Agent, the Purchase Contract Agent shall be under a duty to
examine the same to determine whether or not they conform to the requirements of
this Agreement, the Pledge Agreement or the Remarketing Agreement, as applicable
(but need not confirm or investigate the accuracy of the mathematical
calculations or other facts stated therein).

         (b) No provision of this Agreement, the Pledge Agreement or the
Remarketing Agreement shall be construed to relieve the Purchase Contract Agent
from liability for its own grossly negligent action, its own grossly negligent
failure to act, or its own willful misconduct, except that:

         (1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;

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         (2) the Purchase Contract Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it shall be
conclusively determined by a court of competent jurisdiction that the Purchase
Contract Agent was grossly negligent in ascertaining the pertinent facts; and

         (3) no provision of this Agreement or the Pledge Agreement or the
Remarketing Agreement shall require the Purchase Contract Agent to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.

         (c) Whether or not therein expressly so provided, every provision of
this Agreement, the Pledge Agreement and the Remarketing Agreement relating to
the conduct or affecting the liability of or affording protection to the
Purchase Contract Agent shall be subject to the provisions of this Section.

         (d) The Purchase Contract Agent is authorized to execute and deliver
the Pledge Agreement and the Remarketing Agreement in its capacity as Purchase
Contract Agent.

         SECTION 7.02. Notice of Default.

         Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Purchase Contract Agent has
actual knowledge, the Purchase Contract Agent shall transmit by mail to the
Company and the Holders of Units, as their names and addresses appear in the
Security Register, notice of such default hereunder, unless such default shall
have been cured or waived.

         SECTION 7.03. Certain Rights of Purchase Contract Agent.

         Subject to the provisions of Section 7.01:

         (1) the Purchase Contract Agent may, in the absence of bad faith,
conclusively rely and shall be fully protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, Senior Note, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;

         (2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;

         (3) whenever in the administration of this Agreement or the Pledge
Agreement or the Remarketing Agreement the Purchase Contract Agent shall deem it
desirable that a matter be proved or established prior to taking, suffering or
omitting to take any action hereunder, the Purchase Contract Agent (unless other
evidence be herein specifically prescribed in this

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Agreement) may, in the absence of bad faith on its part, conclusively rely upon
an Officers' Certificate of the Company;

         (4) the Purchase Contract Agent may consult with counsel of its
selection appointed with due care by it hereunder and the advice of such counsel
or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;

         (5) the Purchase Contract Agent shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Purchase Contract Agent, in its discretion, may make
reasonable further inquiry or investigation into such facts or matters related
to the execution, delivery and performance of the Purchase Contracts as it may
see fit, and, if the Purchase Contract Agent shall determine to make such
further inquiry or investigation, it shall be entitled to examine the relevant
books, records and premises of the Company, personally or by agent or attorney;

         (6) the Purchase Contract Agent may execute any of the powers hereunder
or perform any duties hereunder either directly or by or through agents,
attorneys, custodians or nominees or an Affiliate and the Purchase Contract
Agent shall not be responsible for any misconduct or negligence on the part of
any agent, attorney, custodian or nominee or an Affiliate appointed with due
care by it hereunder;

         (7) the Purchase Contract Agent shall be under no obligation to
exercise any of the rights or powers vested in it by this Agreement at the
request or direction of any of the Holders pursuant to this Agreement, unless
such Holders shall have offered to the Purchase Contract Agent security or
indemnity satisfactory to the Purchase Contract Agent against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;

         (8) the Purchase Contract Agent shall not be liable for any action
taken, suffered, or omitted to be taken by it in the absence of bad faith or
gross negligence by it;

         (9) the Purchase Contract Agent shall not be deemed to have notice of
any default hereunder unless a Responsible Officer of the Purchase Contract
Agent has actual knowledge thereof or unless written notice of any event that is
in fact such a default is received by the Purchase Contract Agent at the
Corporate Trust Office of the Purchase Contract Agent, and such notice
references the Units and this Agreement;

         (10) the Purchase Contract Agent may request that the Company deliver
an Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Agreement, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded;

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         (11) the rights, privileges, protections, immunities and benefits given
to the Purchase Contract Agent, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Purchase Contract
Agent in each of its capacities hereunder, and to each agent, custodian and
other Person employed to act hereunder; and

         (12) The Purchase Contract Agent shall not be required to initiate or
conduct any litigation or collection proceedings hereunder and shall have no
responsibilities with respect to any default hereunder except as expressly set
forth herein.

         SECTION 7.04. Not Responsible for Recitals or Issuance of Units.

         The recitals contained herein, in the Pledge Agreement, the Remarketing
Agreement and in the Certificates shall be taken as the statements of the
Company, and the Purchase Contract Agent assumes no responsibility for their
accuracy or validity. The Purchase Contract Agent makes no representations as to
the validity or sufficiency of either this Agreement or of the Units, or of the
Pledge Agreement or the Pledge or the Collateral and shall have no
responsibility for perfecting or maintaining the perfection of any security
interest in the Collateral. The Purchase Contract Agent shall not be accountable
for the use or application by the Company of the proceeds in respect of the
Purchase Contracts.

         SECTION 7.05. May Hold Units.

         Any Security Registrar or any other agent of the Company, or the
Purchase Contract Agent and its Affiliates, in their individual or any other
capacity, may become the owner or pledgee of Units and may otherwise deal with
the Company, the Collateral Agent or any other Person with the same rights it
would have if it were not Security Registrar or such other agent, or the
Purchase Contract Agent. The Company may become the owner or pledgee of Units.

         SECTION 7.06. Money Held in Custody.

         Money held by the Purchase Contract Agent in custody hereunder need not
be segregated from the Purchase Contract Agent's other funds except to the
extent required by law or provided herein. The Purchase Contract Agent shall be
under no obligation to invest or pay interest on any money received by it
hereunder except as otherwise provided hereunder or agreed in writing with the
Company.

         SECTION 7.07. Compensation and Reimbursement.

         The Company agrees:

         (1) to pay to the Purchase Contract Agent compensation for all services
rendered by it hereunder, under the Pledge Agreement and under the Remarketing
Agreement as the Company and the Purchase Contract Agent shall from time to time
agree in writing;

         (2) except as otherwise expressly provided for herein, to reimburse the
Purchase Contract Agent upon its request for all reasonable expenses,
disbursements and advances

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<PAGE>

incurred or made by the Purchase Contract Agent in accordance with any provision
of this Agreement, the Pledge Agreement and the Remarketing Agreement (including
the reasonable compensation and the expenses and disbursements of its agents and
counsel) in connection with the negotiation, preparation, execution and delivery
and performance of this Agreement, the Pledge Agreement and the Remarketing
Agreement and any modification, supplement or waiver of any of the terms
thereof, except any such expense, disbursement or advance as may be attributable
to its gross negligence, willful misconduct or bad faith; and

         (3) to indemnify the Purchase Contract Agent and any predecessor
Purchase Contract Agent (and each of its directors, officers, agents and
employees (collectively, the "INDEMNITEES") for, and to hold it harmless
against, any loss, claim, damage, fine, penalty, liability or expense (including
reasonable fees and expenses of counsel) incurred without gross negligence,
willful misconduct or bad faith on its part, arising out of or in connection
with the acceptance or administration of its duties hereunder and under the
Pledge Agreement and the Remarketing Agreement, including the Indemnitees'
reasonable costs and expenses of defending themselves against any claim (whether
asserted by the Company, a Holder or any other person) or liability in
connection with the exercise or performance of any of the Purchase Contract
Agent's powers or duties hereunder or thereunder.

         The provisions of this Section shall survive the resignation and
removal of the Purchase Contract Agent and the termination of this Agreement.

         SECTION 7.08. Corporate Purchase Contract Agent Required; Eligibility.

         There shall at all times be a Purchase Contract Agent hereunder which
shall be a Person organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having (or being a member of
a bank holding company having) a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal or State authority
and having a corporate trust office in the Borough of Manhattan, New York City,
if there be such a Person in the Borough of Manhattan, New York City, qualified
and eligible under this Article and willing to act on reasonable terms. If such
Person publishes reports of condition at least annually, pursuant to law or to
the requirements of said supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Purchase Contract Agent
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article.

         SECTION 7.09. Resignation and Removal; Appointment of Successor.

         (a) No resignation or removal of the Purchase Contract Agent and no
appointment of a successor Purchase Contract Agent pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Purchase Contract Agent in accordance with the applicable requirements of
Section 7.10.

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         (b) The Purchase Contract Agent may resign at any time by giving
written notice thereof to the Company 60 days prior to the effective date of
such resignation. If the instrument of acceptance by a successor Purchase
Contract Agent required by Section 7.10 shall not have been delivered to the
Purchase Contract Agent within 30 days after the giving of such notice of
resignation, the resigning Purchase Contract Agent may petition, at the expense
of the Company, any court of competent jurisdiction for the appointment of a
successor Purchase Contract Agent.

         (c) The Purchase Contract Agent may be removed at any time by Act of
the Holders of a majority in number of the Outstanding Units delivered to the
Purchase Contract Agent and the Company. If the instrument of acceptance by a
successor Purchase Contract Agent required by Section 7.10 shall not have been
delivered to the Purchase Contract Agent within 30 days after such Act, the
Purchase Contract Agent being removed may petition any court of competent
jurisdiction for the appointment of a successor Purchase Contract Agent.

         (d) If at any time:

                  (1) the Purchase Contract Agent fails to comply with Section
         310(b) of the TIA, as if the Purchase Contract Agent were an indenture
         trustee under an indenture qualified under the TIA, and shall fail to
         resign after written request therefor by the Company or by any Holder
         who has been a bona fide Holder of a Unit for at least six months;

                  (2) the Purchase Contract Agent shall cease to be eligible
         under Section 7.08 and shall fail to resign after written request
         therefor by the Company or by any such Holder; or

                  (3) the Purchase Contract Agent shall become incapable of
         acting or shall be adjudged a bankrupt or insolvent or a receiver of
         the Purchase Contract Agent or of its property shall be appointed or
         any public officer shall take charge or control of the Purchase
         Contract Agent or of its property or affairs for the purpose of
         rehabilitation, conservation or liquidation,

then, in any such case, (i) the Company by a Board Resolution may remove the
Purchase Contract Agent, or (ii) any Holder who has been a bona fide Holder of a
Unit for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Purchase Contract Agent and the appointment of a successor Purchase Contract
Agent.

         (e) If the Purchase Contract Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Purchase
Contract Agent for any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Purchase Contract Agent and shall comply with the applicable
requirements of Section 7.10. If no successor Purchase Contract Agent shall have
been so appointed by the Company and accepted appointment in the manner required
by Section 7.10, any Holder who has been a bona fide Holder of a Unit for at
least six months, on behalf of itself and all others similarly situated, or the
Purchase Contract

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Agent may petition at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Purchase Contract Agent.

         (f) The Company shall give, or shall cause such successor Purchase
Contract Agent to give, notice of each resignation and each removal of the
Purchase Contract Agent and each appointment of a successor Purchase Contract
Agent by mailing written notice of such event by first-class mail, postage
prepaid, to all Holders as their names and addresses appear in the applicable
Security Register. Each notice shall include the name of the successor Purchase
Contract Agent and the address of its Corporate Trust Office.

         SECTION 7.10. Acceptance of Appointment by Successor.

         (a) In case of the appointment hereunder of a successor Purchase
Contract Agent, every such successor Purchase Contract Agent so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Purchase
Contract Agent an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Purchase Contract Agent shall become
effective and such successor Purchase Contract Agent, without any further act,
deed or conveyance, shall become vested with all the rights, powers, agencies
and duties of the retiring Purchase Contract Agent; but, on the request of the
Company or the successor Purchase Contract Agent, such retiring Purchase
Contract Agent shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Purchase Contract Agent all the
rights, powers and trusts of the retiring Purchase Contract Agent and duly
assign, transfer and deliver to such successor Purchase Contract Agent all
property and money held by such retiring Purchase Contract Agent hereunder.

         (b) Upon request of any such successor Purchase Contract Agent, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Purchase Contract Agent all such
rights, powers and agencies referred to in paragraph (a) of this Section.

         (c) No successor Purchase Contract Agent shall accept its appointment
unless at the time of such acceptance such successor Purchase Contract Agent
shall be qualified and eligible under this Article.

         SECTION 7.11. Merger, Conversion, Consolidation or Succession to
Business.

         Any Person into which the Purchase Contract Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Purchase Contract Agent shall
be a party, or any Person succeeding to all or substantially all the corporate
trust business of the Purchase Contract Agent, shall be the successor of the
Purchase Contract Agent hereunder, provided that such Person shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto. In case
any Certificates shall have been authenticated and executed on behalf of the
Holders, but not delivered, by the Purchase Contract Agent then in office, any
successor by merger, conversion or consolidation to such Purchase

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Contract Agent may adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Purchase Contract Agent had itself authenticated and executed such
Units.

         SECTION 7.12. Preservation of Information; Communications to Holders.

         (a) The Purchase Contract Agent shall preserve, in as current a form as
is reasonably practicable, the names and addresses of Holders received by the
Purchase Contract Agent in its capacity as Security Registrar.

         (b) If three or more Holders (herein referred to as "APPLICANTS") apply
in writing to the Purchase Contract Agent, and furnish to the Purchase Contract
Agent reasonable proof that each such applicant has owned a Unit for a period of
at least six months preceding the date of such application, and such application
states that the applicants desire to communicate with other Holders with respect
to their rights under this Agreement or under the Units and is accompanied by a
copy of the form of proxy or other communication which such applicants propose
to transmit, then the Purchase Contract Agent shall mail to all the Holders
copies of the form of proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the Purchase Contract
Agent of the materials to be mailed and of payment, or provision for the
payment, of the reasonable expenses of such mailing.

         SECTION 7.13. No Obligations of Purchase Contract Agent.

         Except to the extent otherwise expressly provided in this Agreement,
the Purchase Contract Agent assumes no obligations and shall not be subject to
any liability under this Agreement, the Pledge Agreement, the Remarketing
Agreement or any Purchase Contract in respect of the obligations of the Holder
of any Unit thereunder. The Company agrees, and each Holder of a Certificate, by
its acceptance thereof, shall be deemed to have agreed, that the Purchase
Contract Agent's execution of the Certificates on behalf of the Holders shall be
solely as agent and attorney-in-fact for the Holders, and that the Purchase
Contract Agent shall have no obligation to perform such Purchase Contracts on
behalf of the Holders, except to the extent expressly provided in Article Five
hereof. Anything contained in this Agreement to the contrary notwithstanding, in
no event shall the Purchase Contract Agent or its officers, directors, employees
or agents be liable under this Agreement, the Pledge Agreement or the
Remarketing Agreement to any third party for indirect, incidental, special,
punitive, or consequential loss or damage of any kind whatsoever, including lost
profits, whether or not the likelihood of such loss or damage was known to the
Purchase Contract Agent and regardless of the form of action.

         SECTION 7.14. Tax Compliance.

         (a) The Purchase Contract Agent, on its own behalf and on behalf of the
Company, will comply with all applicable certification, information reporting
and withholding (including "backup" withholding) requirements imposed by
applicable tax laws, regulations or administrative practice with respect to (i)
any payments made with respect to the Units or (ii) the issuance, delivery,
holding, transfer, redemption or exercise of rights under the Units. Such

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compliance shall include, without limitation, the preparation and timely filing
of required returns and the timely payment of all amounts required to be
withheld to the appropriate taxing authority or its designated agent.

         (b) The Purchase Contract Agent shall comply in accordance with the
terms hereof with any written direction received from the Company with respect
to the execution or certification of any required documentation and the
application of such requirements to particular payments or Holders or in other
particular circumstances, and may for purposes of this Agreement conclusively
rely on any such direction in accordance with the provisions of Section
7.01(a)(2) hereof.

         (c) The Purchase Contract Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such records
available, on written request, to the Company or its authorized representative
within a reasonable period of time after receipt of such request.

                                  ARTICLE 8

                           SUPPLEMENTAL AGREEMENTS

         SECTION 8.01. Supplemental Agreements Without Consent of Holders.

         Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Purchase Contract Agent, at any time and from time to
time, may enter into one or more agreements supplemental hereto, in form
satisfactory to the Company and the Purchase Contract Agent, to:

                  (1) evidence the succession of another Person to the Company,
         and the assumption by any such successor of the covenants of the
         Company herein and in the Certificates;

                  (2) evidence and provide for the acceptance of appointment
         hereunder by a successor Purchase Contract Agent;

                  (3) add to the covenants of the Company for the benefit of the
         Holders, or surrender any right or power herein conferred upon the
         Company;

                  (4) make provision with respect to the rights of Holders
         pursuant to the requirements of Section 5.04(b); or

                  (5) except as provided for in Section 5.04, cure any
         ambiguity, correct or supplement any provisions herein which may be
         inconsistent with any other provisions herein, or make any other
         provisions with respect to such matters or questions arising

                                       80

<PAGE>

         under this Agreement, provided that such action shall not adversely
         affect the interests of the Holders in any material respect.

         SECTION 8.02. Supplemental Agreements with Consent of Holders.

         With the consent of the Holders of not less than a majority of the
Outstanding Units voting together as one class, including without limitation the
consent of the Holders obtained in connection with a tender or an exchange
offer, by Act of said Holders delivered to the Company and the Purchase Contract
Agent, the Company, when authorized by a Board Resolution, and the Purchase
Contract Agent may enter into an agreement or agreements supplemental hereto for
the purpose of modifying in any manner the terms of the Purchase Contracts, or
the provisions of this Agreement or the rights of the Holders in respect of the
Units; provided, however, that, except as contemplated herein, no such
supplemental agreement shall, without the unanimous consent of the Holders of
each outstanding Purchase Contract affected thereby,

                  (1) change any Payment Date;

                  (2) change the amount or the type of Collateral required to be
         Pledged to secure a Holder's obligations under the Purchase Contract,
         unless such change is not adverse to the Holders, impair the right of
         the Holder of any Purchase Contract to receive distributions on the
         related Collateral or otherwise adversely affect the Holder's rights in
         or to such Collateral or adversely alter the rights in or to such
         Collateral;

                  (3) impair the right to institute suit for the enforcement of
         any Purchase Contract or payment of any Contract Adjustment Payments;

                  (4) reduce the number of shares of Common Stock or the amount
         of any other property to be purchased pursuant to any Purchase
         Contract, increase the price to purchase shares of Common Stock or any
         other property upon settlement of any Purchase Contract or change the
         Purchase Contract Settlement Date or the right to Early Settlement or
         Cash Merger Early Settlement or otherwise adversely affect the Holder's
         rights under the Purchase Contract;

                  (5) reduce any Contract Adjustment Payments or change any
         place where, or the coin or currency in which, any Contract Adjustment
         Payment is payable; or

                  (6) reduce the percentage of the outstanding Purchase
         Contracts the consent of whose Holders is required for any modification
         or amendment to the provisions of this Agreement, the Purchase
         Contracts or the Pledge Agreement;

provided that if any amendment or proposal referred to above would adversely
affect only the Corporate Units or the Treasury Units, then only the affected
class of Holders as of the record date for the Holders entitled to vote thereon
will be entitled to vote on such amendment or proposal, and such amendment or
proposal shall not be effective except with the consent of Holders of not less
than a majority of such class; and provided, further, that the unanimous

                                       81

<PAGE>

consent of the Holders of each outstanding Purchase Contract of such class
affected thereby shall be required to approve any amendment or proposal
specified in clauses (1) through (6) above.

         It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.

         SECTION 8.03. Execution of Supplemental Agreements.

         In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Purchase Contract Agent shall be
provided, and (subject to Section 7.01) shall be fully authorized and protected
in relying upon, an Opinion of counsel stating that the execution of such
supplemental agreement is authorized or permitted by this Agreement and an
Officers' Certificate stating that any and all conditions precedent to the
execution and delivery of such supplemental agreement have been satisfied. The
Purchase Contract Agent may, but shall not be obligated to, enter into any such
supplemental agreement which affects the Purchase Contract Agent's own rights,
duties or immunities under this Agreement or otherwise.

         SECTION 8.04. Effect of Supplemental Agreements.

         Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder, shall be bound thereby.

         SECTION 8.05. Reference to Supplemental Agreements.

         Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent as to any matter
provided for in such supplemental agreement. If the Company shall so determine,
new Certificates so modified as to conform, in the opinion of the Purchase
Contract Agent and the Company, to any such supplemental agreement may be
prepared and executed by the Company and authenticated, executed on behalf of
the Holders and delivered by the Purchase Contract Agent in exchange for
outstanding Certificates.

                                   ARTICLE 9

              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

         SECTION 9.01. Covenant Not to Consolidate, Merge, Convey, Transfer or
Lease Property Except under Certain Conditions.

                                       82

<PAGE>

         The Company covenants that it will not consolidate with, convert into,
or merge with and into, any other corporation or sell, assign, transfer, lease
or convey all or substantially all of its properties and assets to any Person,
unless:

                  (i) either the Company shall be the continuing corporation, or
         the successor (if other than the Company) shall be a corporation
         organized and existing under the laws of the United States of America
         or a State thereof or the District of Columbia and such corporation
         shall expressly assume all the obligations of the Company under the
         Purchase Contracts, this Agreement, the Pledge Agreement, the Indenture
         (including any supplement thereto) and the Remarketing Agreement by one
         or more supplemental agreements in form reasonably satisfactory to the
         Purchase Contract Agent and the Collateral Agent, executed and
         delivered to the Purchase Contract Agent and the Collateral Agent by
         such corporation; and

                  (ii) the Company or such successor corporation, as the case
         may be, shall not, immediately after such consolidation, conversion,
         merger, sale, assignment, transfer, lease or conveyance, be in default
         of payment obligations under the Purchase Contracts, this Agreement,
         the Pledge Agreement, the Indenture (including any supplement thereto)
         or the Remarketing Agreement or in material default in the performance
         of any other covenants under any of the foregoing agreements.

         SECTION 9.02. Rights and Duties of Successor Corporation.

         In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance and upon any such assumption by a
successor corporation in accordance with Section 9.01, such successor
corporation shall succeed to and be substituted for the Company with the same
effect as if it had been named herein as the Company. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or in the
name of The Chubb Corporation, any or all of the Certificates evidencing Units
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Purchase Contract Agent; and, upon the order of such
successor corporation, instead of the Company, and subject to all the terms,
conditions and limitations in this Agreement prescribed, the Purchase Contract
Agent shall authenticate and execute on behalf of the Holders and deliver any
Certificates which previously shall have been signed and delivered by the
officers of the Company to the Purchase Contract Agent for authentication and
execution, and any Certificate evidencing Units which such successor corporation
thereafter shall cause to be signed and delivered to the Purchase Contract Agent
for that purpose. All the Certificates issued shall in all respects have the
same legal rank and benefit under this Agreement as the Certificates theretofore
or thereafter issued in accordance with the terms of this Agreement as though
all of such Certificates had been issued at the date of the execution hereof.

         In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance such change in phraseology and form
(but not in substance) may be made in the Certificates evidencing Units
thereafter to be issued as may be appropriate.

                                       83

<PAGE>

         SECTION 9.03. Officers' Certificate and Opinion of Counsel Given to
Purchase Contract Agent.

         The Purchase Contract Agent, subject to Sections 7.01 and 7.03, shall
receive an Opinion of Counsel as conclusive evidence that any such merger,
consolidation, share exchange, sale, assignment, transfer, lease or conveyance,
and any such assumption, complies with the provisions of this Article and an
Officers' Certificate that all conditions precedent to the consummation of any
such merger, consolidation, share exchange, sale, assignment, transfer, lease or
conveyance have been met.

                                   ARTICLE 10

                                   COVENANTS

         SECTION 10.1. Performance under Purchase Contracts.

         The Company covenants and agrees for the benefit of the Holders from
time to time of the Units that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.

         SECTION 10.2. Maintenance of Office or Agency.

         The Company will maintain in the Borough of Manhattan, New York City an
office or agency where Certificates may be presented or surrendered for
acquisition of shares of Common Stock upon settlement of the Purchase Contracts
on the Purchase Contract Settlement Date or upon Early Settlement or Cash Merger
Early Settlement and for transfer of Collateral upon occurrence of a Termination
Event, where Certificates may be surrendered for registration of transfer or
exchange, for a Collateral Substitution or recreation of Corporate Units and
where notices and demands to or upon the Company in respect of the Units and
this Agreement may be served. The Company will give prompt written notice to the
Purchase Contract Agent of the location, and any change in the location, of such
office or agency. The Company initially designates Bank One Trust Company, N.A.,
55 Water Street, 1st Floor, Jeanette Park Entrance, New York, New York 10041 as
such office of the Company. If at any time the Company shall fail to maintain
any such required office or agency or shall fail to furnish the Purchase
Contract Agent with the address thereof, such presentations, surrenders, notices
and demands may be made or served at the address set forth in the previous
sentence, and the Company hereby appoints the Purchase Contract Agent as its
agent to receive all such presentations, surrenders, notices and demands.

         The Company may also from time to time designate one or more other
offices or agencies where Certificates may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the

                                       84

<PAGE>

Borough of Manhattan, New York City for such purposes. The Company will give
prompt written notice to the Purchase Contract Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Units the
Corporate Trust Office and appoints the Purchase Contract Agent at its Corporate
Trust Office as paying agent in such city.

         SECTION 10.03. Company to Reserve Common Stock.

         The Company shall at all times prior to the Purchase Contract
Settlement Date reserve and keep available, free from preemptive rights, out of
its authorized but unissued Common Stock the full number of shares of Common
Stock issuable against tender of payment in respect of all Purchase Contracts
represented by the Units evidenced by Outstanding Certificates.

         SECTION 10.04. Covenants as to Common Stock.

         The Company covenants that all shares of Common Stock that may be
issued against tender of payment in respect of any Purchase Contract represented
by the Outstanding Units will, upon issuance, be duly authorized, validly
issued, fully paid and nonassessable.

         SECTION 10.05. Statements of Officers of the Company as to Default.

         The Company will deliver to the Purchase Contract Agent, within 120
days after the end of each fiscal year of the Company (which as of the date
hereof is December 31) ending after the date hereof, an Officers' Certificate,
stating whether or not to the knowledge of the signers thereof the Company is in
default in the performance and observance of any of the terms, provisions and
conditions hereof, and if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.

         SECTION 10.06. Tax Treatment. The Company covenants and agrees, and by
purchasing a Corporate Unit each Holder agrees, for United States federal, state
and local tax purposes, to (i) treat a Holder's acquisition of the Corporate
Units as the acquisition of the Senior Note and Purchase Contracts represented
by the Corporate Units, (ii) treat the Senior Notes as indebtedness of the
Company and (iii)each Holder as the owner of the applicable interest in the
Collateral Account, including the Senior Notes and Applicable Ownership
Interests in the Treasury Portfolio or the Treasury Securities.

                       [SIGNATURES ON THE FOLLOWING PAGE]

                                       85

<PAGE>

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

                                        THE CHUBB CORPORATION

                                        By: /s/ JOHN D. FINNEGAN
                                            ------------------------------------
                                                  John D. Finnegan
                                                  Chief Executive Officer

                                        BANK ONE TRUST COMPANY, N.A.,
                                        as Purchase Contract Agent

                                        By: /s/ SANDRA WHALEN
                                            ------------------------------------
                                                  Sandra Whalen
                                                  Vice President

<PAGE>

                                                                       EXHIBIT A

                  (FORM OF FACE OF CORPORATE UNITS CERTIFICATE)

         [For inclusion in Global Certificates only - THIS CERTIFICATE IS A
GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF CEDE & CO., AS THE
NOMINEE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE
"DEPOSITARY"), THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. THIS
CERTIFICATE IS EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON
OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE
(OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

No. 1                                                      CUSIP No. 171232 50 7
Number of Corporate Units: 18,400,000

                              THE CHUBB CORPORATION
                                 Corporate Units

This Corporate Units Certificate certifies that [Cede & Co.] [_______] is the
registered Holder of the number of Corporate Units set forth above [For
inclusion in Global Certificates only - or such other number of Corporate Units
as is reflected in the Schedule of Increases or Decreases in the Global
Certificate attached hereto]. Each Corporate Unit represents (i) either (a) the
beneficial ownership by the Holder of $25.00 principal amount of Senior Notes
due August 16, 2008 (the "SENIOR NOTES") of The Chubb Corporation, a New Jersey
corporation (the "COMPANY"), subject to the Pledge of such Senior Note by such
Holder pursuant to the Pledge.

                                       A-1

<PAGE>

Agreement, or (b) upon the occurrence of a Special Event Redemption prior to the
Purchase Contract Settlement Date or a Successful Remarketing of the Senior
Notes prior to the Final Remarketing Date, the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio by such Holder pursuant to the Pledge Agreement, and (ii) the
rights and obligations of the Holder under one Purchase Contract with the
Company. All capitalized terms used herein which are defined in the Purchase
Contract Agreement (as defined on the reverse hereof) have the meaning set forth
therein.

         Pursuant to the Pledge Agreement, the Senior Notes or the appropriate
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio, as the case may be, represented by each
Corporate Unit evidenced hereby have been pledged to the Collateral Agent, for
the benefit of the Company, to secure the obligations of the Holder under the
Purchase Contract represented by such Corporate Unit.

         The Pledge Agreement provides that all payments of the principal amount
with respect to any of the Pledged Senior Notes or the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as the case may be, or interest or distributions on
any Pledged Senior Notes (as defined in the Pledge Agreement) or the appropriate
Applicable Ownership Interests (as specified in clause (ii) of the definition of
such term) in the Treasury Portfolio, as the case may be, represented by the
Corporate Units received by the Securities Intermediary shall be paid by wire
transfer in same day funds (i) in the case of (A) interest on Pledged Senior
Notes or distributions with respect to the appropriate Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) in the
Treasury Portfolio, as the case may be, and (B) any payments of the principal
amount of any Senior Notes or with respect to the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as the case may be, that have been released from the
Pledge pursuant to the Pledge Agreement, to the Purchase Contract Agent to the
account designated by the Purchase Contract Agent, no later than 2:00 p.m., New
York City time, on the Business Day such payment is received by the Securities
Intermediary (provided that in the event such payment is received by the
Securities Intermediary on a day that is not a Business Day or after 12:30 p.m.,
New York City time, on a Business Day, then such payment shall be made no later
than 10:30 a.m., New York City time, on the next succeeding Business Day) and
(ii) in the case of payments with respect to the principal amount of the Senior
Notes or with respect to the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, to the Company on the Purchase Contract Settlement Date (as described
herein) in accordance with the terms of the Pledge Agreement, in full
satisfaction of the respective obligations of the Holders of the Corporate Units
representing such Pledged Senior Notes or the Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, under the Purchase Contracts represented by such
Corporate Units. Interest on the Senior Notes and distributions on the
appropriate Applicable Ownership Interests (as specified in clause (ii) of the
definition of such term) in the Treasury Portfolio, as the case may be,
represented by a Corporate Units evidenced hereby, which are payable quarterly
in arrears on February 16, May 16, August 16, and

                                       A-2

<PAGE>

November 16 of each year, commencing August 16, 2003 (a "PAYMENT DATE"), shall,
subject to receipt thereof by the Purchase Contract Agent from the Securities
Intermediary, be paid to the Person in whose name this Corporate Units
Certificate (or a Predecessor Corporate Units Certificate) is registered at the
close of business on the Record Date for such Payment Date.

         Each Purchase Contract evidenced hereby obligates the Holder of this
Corporate Units Certificate to purchase, and the Company to sell, on August 16,
2006 (the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00 (the
"STATED AMOUNT"), a number of newly issued shares of common stock, par value
$1.00 per share ("COMMON STOCK"), of the Company, equal to the Settlement Rate,
unless on or prior to the Purchase Contract Settlement Date there shall have
occurred a Termination Event or an Early Settlement or Cash Merger Early
Settlement with respect to such Purchase Contract, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
Stated Amount for the shares of Common Stock purchased pursuant to each Purchase
Contract evidenced hereby, if not paid earlier, shall be paid on the Purchase
Contract Settlement Date by application of payment received in respect of the
principal amount with respect to any Pledged Senior Notes pursuant to the
Remarketing or the appropriate Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio, as the
case may be, pledged to secure the obligations under such Purchase Contract of
the Holder of the Corporate Units of which such Purchase Contract is a part.

         Each Purchase Contract evidenced hereby obligates the holder to agree,
for United States federal, state and local tax purposes, to (i) treat an
acquisition of the Corporate Units as an acquisition of the Senior Notes and
Purchase Contracts represented by the Corporate Units and (ii) treat itself as
owner of the applicable interest in the Collateral Account, including the Senior
Notes and the Applicable Ownership Interests in the Treasury Portfolio.

         The Company shall pay, on each Payment Date, in respect of each
Purchase Contract represented by a Corporate Unit evidenced hereby, an amount
(the "CONTRACT ADJUSTMENT PAYMENTS") equal to 4.75% per year of the Stated
Amount. Such Contract Adjustment Payments shall be payable to the Person in
whose name this Corporate Units Certificate is registered at the close of
business on the Record Date for such Payment Date. The Company may, at its
option, defer such Contract Adjustment Payments.

         Interest on the Senior Notes and distributions on the Applicable
Ownership Interests (as specified in clause (ii) of the definition of such term)
and the Contract Adjustment Payments will be payable at the office of the
Purchase Contract Agent in New York City. If the book-entry system for the
Corporate Units has been terminated, the Contract Adjustment Payments will be
payable, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such Person's address as it appears on the Security
Register, or by wire transfer to the account designated by such Person by a
prior written notice to the Purchase Contract Agent.

                                       A-3

<PAGE>

         Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.

         Unless the certificate of authentication hereon has been executed by
the Purchase Contract Agent by manual signature, this Corporate Units
Certificate shall not be entitled to any benefit under the Pledge Agreement or
the Purchase Contract Agreement or be valid or obligatory for any purpose.

                                       A-4

<PAGE>

         IN WITNESS WHEREOF, the Company and the Holder specified above have
caused this instrument to be duly executed.

                                        The Chubb Corporation

                                        By: ____________________________________
                                            Name:
                                            Title:

                                        By: ____________________________________
                                            Name:
                                            Title:

                                        HOLDER SPECIFIED ABOVE (as to
                                        obligations of such Holder under the
                                        Purchase Contracts)

                                        By: BANK ONE TRUST COMPANY,
                                        N.A., not individually but solely as
                                        Attorney-in-Fact of such Holder

                                        By: ____________________________________
                                            Name:
                                            Title:

DATED:__________________

                                       A-5

<PAGE>

                          CERTIFICATE OF AUTHENTICATION
                           OF PURCHASE CONTRACT AGENT

         This is one of the Corporate Units Certificates referred to in the
within mentioned Purchase Contract Agreement.

                                        By:  BANK ONE TRUST COMPANY, N.A.,
                                        as Purchase Contract Agent

                                        By: ____________________________________
                                            Name:
                                            Title:

Dated: ____________________

                                       A-6

<PAGE>

                 (FORM OF REVERSE OF CORPORATE UNIT CERTIFICATE)

         Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of June 24, 2003 (as may be supplemented from time
to time, the "PURCHASE CONTRACT AGREEMENT"), between the Company and Bank One
Trust Company, N.A., as Purchase Contract Agent (including its successors
hereunder, the "PURCHASE CONTRACT AGENT"), to which Purchase Contract Agreement
and supplemental agreements thereto reference is hereby made for a description
of the respective rights, limitations of rights, obligations, duties and
immunities thereunder of the Purchase Contract Agent, the Company, and the
Holders and of the terms upon which the Corporate Units Certificates are, and
are to be, executed and delivered.

         Each Purchase Contract evidenced hereby obligates the Holder of this
Corporate Units Certificate to purchase, and the Company to sell, on August 16,
2006 (the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00 (the
"STATED AMOUNT"), a number of newly issued shares of common stock, par value
$1.00 per share ("COMMON STOCK"), of the Company, equal to the Settlement Rate,
unless on or prior to the Purchase Contract Settlement Date there shall have
occurred a Termination Event or an Early Settlement or Cash Merger Early
Settlement with respect to such Purchase Contract. The "SETTLEMENT RATE" is
equal to:

         (1) if the Adjusted Applicable Market Value (as defined below) is
greater than $71.40 (the "THRESHOLD APPRECIATION PRICE"), 0.3501 shares of
Common Stock per Purchase Contract;

         (2) if the Adjusted Applicable Market Value is less than or equal to
the Threshold Appreciation Price but greater than or equal to $59.50 (the
"REFERENCE PRICE"), the number of shares of Common Stock per Purchase Contract
having a value equal to the Stated Amount divided by the Adjusted Applicable
Market Value; and

         (3) if the Adjusted Applicable Market Value is less than the Reference
Price, 0.4202 shares of Common Stock per Purchase Contract;

in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).

         No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.

         Each Purchase Contract evidenced hereby that is settled through Early
Settlement or Cash Merger Early Settlement shall obligate the Holder of the
related Corporate Units to purchase at the Stated Amount, and the Company to
sell, a number of newly issued shares of Common Stock equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).

                                       A-7

<PAGE>

         The "APPLICABLE MARKET VALUE" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date subject to adjustments set forth under Section 5.04 of the Purchase
Contract Agreement.

         The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any
adjustment of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement, the
Applicable Market Value, and (ii) at the time of and after any adjustment of the
Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10)
of Section 5.04(a) of the Purchase Contract Agreement, the Applicable Market
Value multiplied by a fraction, the numerator of which shall be the Settlement
Rate immediately after such adjustment pursuant to paragraph (1), (2), (3), (4),
(5), (6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement and
the denominator of which shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.

         The "CLOSING PRICE" per share of Common Stock on any date of
determination means:

         (1) the closing sale price as of the close of the principal trading
session (or, if no closing price is reported, the last reported sale price) per
share on the New York Stock Exchange, Inc. (the "NYSE") on such date;

         (2) if the Common Stock is not listed for trading on the NYSE on any
such date, the closing sale price (or, if no closing price is reported, the last
reported sale price) per share as reported in the composite transactions for the
principal United States national or regional securities exchange on which Common
Stock is so listed;

         (3) if the Common Stock is not so listed on a United States national or
regional securities exchange, the last reported sale price per share as reported
by The Nasdaq National Market, Inc.;

         (4) if the Common Stock is not so reported by the Nasdaq National
Market, Inc., the last quoted bid price for Common Stock in the over-the-counter
market as reported by the National Quotation Bureau or similar organization; or

         (5) if such bid price, referred to in clause (4), is not available, the
market value of Common Stock on such date as determined by a nationally
recognized independent investment banking firm retained for this purpose by the
Company.

                                       A-8

<PAGE>

         A "TRADING DAY" means a day on which the Common Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of Common Stock.

         In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Corporate Units Certificate may pay the Stated Amount for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby by effecting a Cash Settlement, an Early Settlement or, if applicable, a
Cash Merger Early Settlement or from the proceeds of the Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio or a Remarketing of the related Pledged Senior Notes. Unless
the Treasury Portfolio has replaced the Senior Notes represented by Corporate
Units, a Holder of Corporate Units who (1) does not, on or prior to 5:00 p.m.
(New York City time) on the fifth Business Day immediately preceding the
Purchase Contract Settlement Date, notify the Purchase Contract Agent of its
intention to effect a Cash Settlement, or who does so notify the Purchase
Contract Agent but fails to make an effective Cash Settlement prior to 5:00 p.m.
(New York City time) on the fourth Business Day immediately preceding the
Purchase Contract Settlement Date, or (2) on or prior to 5:00 p.m. (New York
City time) on the fifth Business Day prior to the Purchase Contract Settlement
Date, does not make an effective Early Settlement, shall pay the Stated Amount
for the shares of Common Stock to be delivered under the related Purchase
Contract from the proceeds of the sale of the related Pledged Senior Notes held
by the Collateral Agent unless the Holder has previously made a Cash Merger
Early Settlement. Unless the Treasury Portfolio has replaced the Senior Notes
represented by Corporate Units, such sale will be made by the Remarketing Agent
pursuant to the terms of the Remarketing Agreement on the Final Remarketing
Date. If the Treasury Portfolio has replaced the Senior Notes represented by
Corporate Units, a Holder of Corporate Units who does not notify the Purchase
Contract Agent, on or prior to 5:00 p.m. (New York City time) on the fifth
Business Day immediately preceding the Purchase Contract Settlement Date of its
intention to effect a Cash Settlement shall pay the Stated Amount for the shares
of Common Stock to be delivered under the related Purchase Contract from the
proceeds at maturity of the Applicable Ownership Interests (as defined in clause
(i) of the definition of such term) in the Treasury Portfolio.

         If, as provided in the Purchase Contract Agreement, upon the occurrence
of a Failed Final Remarketing, the Collateral Agent, for the benefit of the
Company, exercises its rights as a secured creditor with respect to the Pledged
Senior Notes related to this Corporate Units Certificate, any accrued and unpaid
interest on such Pledged Senior Notes shall become payable by the Company to the
Purchase Contract Agent for payment to the Beneficial Owner of the Corporate
Units to which such Senior Notes relate.

         The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received

                                       A-9

<PAGE>

payment of the aggregate Stated Amount for the shares of Common Stock to be
purchased thereunder in the manner set forth in the Purchase Contract Agreement.

         Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder hereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Purchase Contract Agent and to the Holders, at their
addresses as they appear in the Security Register. Upon and after the occurrence
of a Termination Event, the Collateral Agent shall release the Pledged Senior
Notes or the appropriate Applicable Ownership Interests (as specified in clause
(i) of the definition of such term) in the Treasury Portfolio represented by
each Corporate Unit from the Pledge. A Corporate Unit shall thereafter represent
the right to receive the Senior Note or the appropriate Applicable Ownership
Interests in the Treasury Portfolio represented by such Corporate Units in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.

         Under the terms of the Pledge Agreement and the Purchase Contract
Agreement, the Purchase Contract Agent will be entitled to exercise the voting
and any other consensual rights pertaining to the Pledged Senior Notes, but only
to the extent instructed in writing by the Holders. Upon receipt of notice of
any meeting at which holders of Senior Notes are entitled to vote or upon the
solicitation of consents, waivers or proxies of holders of Senior Notes, the
Purchase Contract Agent shall, as soon as practicable thereafter, mail to the
Corporate Units Holders a notice:

         (1) containing such information as is contained in the notice or
solicitation;

         (2) stating that each Corporate Units Holder on the record date set by
the Purchase Contract Agent therefor (which, to the extent possible, shall be
the same date as the record date for determining the holders of Senior Notes
entitled to vote) shall be entitled to instruct the Purchase Contract Agent as
to the exercise of the voting rights pertaining to the Senior Notes represented
by such Holder's Corporate Units; and

         (3) stating the manner in which such instructions may be given.

Upon the written request of the Corporate Units Holders on such record date,
received by the Purchase Contract Agent at least six days prior to such meeting,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum aggregate principal amount of Senior Notes as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Corporate Unit, the Purchase Contract Agent
shall abstain from voting the Senior Note evidenced by such Corporate Unit.

         Upon the occurrence of a Special Event Redemption, the Collateral Agent
shall surrender the Pledged Senior Notes against delivery of an amount equal to
the aggregate Redemption Price

                                      A-10

<PAGE>

of the Pledged Senior Notes and shall deposit funds in the Collateral Account in
exchange for the Pledged Senior Notes. Thereafter, pursuant to the terms of the
Pledge Agreement, the Collateral Agent shall cause the Securities Intermediary
to apply an amount equal to the aggregate Redemption Amount of such funds to
purchase on behalf of the Holders of Corporate Units, the Treasury Portfolio,
and promptly (a) transfer the Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio to the
Collateral Account to secure the obligations of each Holder of Corporate Units
to purchase shares of Common Stock under the Purchase Contracts represented by
such Corporate Units, (b) transfer the Applicable Ownership Interests (as
specified in clause (ii) of the definition of such term) in the Treasury
Portfolio to the Purchase Contract Agent for the benefit of the Holders of such
Corporate Units and (C) remit the remaining portion of such funds to the
Purchase Contract Agent for payment to the Holders of such Corporate Units.

         Upon the occurrence of a Successful Remarketing of Senior Notes prior
to the Final Remarketing Date, pursuant to the terms of the Remarketing
Agreement, the Remarketing Agent will apply an amount equal to the Treasury
Portfolio Purchase Price to purchase on behalf of the Holders of Corporate
Units, the Treasury Portfolio, and, after deducting the Remarketing Fee to the
extent permitted under the terms of the Remarketing Agreement, promptly remit
the remaining portion of such proceeds of such Successful Remarketing to the
Purchase Contract Agent for payment to the Holders of such Corporate Units.

         Following the occurrence of (i) a Special Event Redemption prior to the
Purchase Contract Settlement Date, or (ii) a Successful Remarketing of the
Senior Notes prior to the Final Remarketing Date, the Holders of Corporate Units
and the Collateral Agent shall have such security interest rights and
obligations with respect to the Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio as the
Holder of Corporate Units and the Collateral Agent had in respect of the Senior
Notes, as the case may be, subject to the Pledge thereof as provided in the
Pledge Agreement and any reference herein to the Senior Notes shall be deemed to
be a reference to such Treasury Portfolio.

         The Corporate Units Certificates are issuable only in registered form
and only in denominations of a single Corporate Unit and any integral multiple
thereof. The transfer of any Corporate Units Certificate will be registered and
Corporate Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Security Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Purchase
Contract Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute a Treasury Security for a Senior Note, thereby creating Treasury
Units, shall be responsible for any fees or expenses payable in connection
therewith. Except as provided in the Purchase Contract Agreement, for so long as
the Purchase Contract represented by a Corporate Units remains in effect, such
Corporate Units shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Corporate Units in

                                      A-11

<PAGE>

respect of the Senior Notes and Purchase Contract represented by such Corporate
Units may be transferred and exchanged only as a Corporate Unit.

         Unless the Treasury Portfolio has replaced the Senior Notes represented
by the Corporate Units, and subject to the conditions set forth in the Purchase
Contract Agreement, the Holder of Corporate Units may substitute, at any time
prior to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, for the Pledged Senior Notes
securing such Holder's obligations under the related Purchase Contracts,
Treasury Securities in an aggregate principal amount at maturity equal to the
aggregate principal amount of the Pledged Senior Notes in accordance with the
terms of the Purchase Contract Agreement and the Pledge Agreement. From and
after such Collateral Substitution, each Unit for which such Pledged Treasury
Securities secures the Holder's obligation under the Purchase Contract shall be
referred to as a "TREASURY UNIT". A Holder may make such Collateral Substitution
only in integral multiples of 40 Corporate Units for 40 Treasury Units.

         If the Treasury Portfolio has replaced the Senior Notes represented by
the Corporate Units, a Holder may, at any time on or prior to the second
Business Day immediately preceding the Purchase Contract Settlement Date,
substitute Treasury Securities for the Applicable Ownership Interests in the
Treasury Portfolio, but only in integral multiples of 64,000 Corporate Units. In
such an event, the Holder shall transfer Treasury Securities to the Collateral
Agent, and the Purchase Contract Agent shall instruct the Collateral Agent to
release the Pledge of and transfer to the Holder the appropriate Applicable
Ownership Interests in the Treasury Portfolio.

         The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Corporate Units Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City. If the book-entry system for the Corporate
Units has been terminated, the Contract Adjustment Payments will be payable, at
the option of the Company, by check mailed to the address of the Person entitled
thereto at such Person's address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.

         The Company has the right to defer payment of all or part of the
Contract Adjustment Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date (or in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early Settlement Date or
Cash Merger Early Settlement Date, as the case may be). If the Company so elects
to defer Contract Adjustment Payments, the Company shall pay additional Contract
Adjustment Payments on such deferred installments of Purchase Contract Payments
at a rate equal to 7.00% per annum, compounding on each succeeding Payment Date,
until such deferred installments are paid. In the event that the Company elects
to defer the payment of Contract Adjustment Payments on the Purchase Contracts
until the Purchase Contract Settlement Date (or, in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early

                                      A-12

<PAGE>

Settlement Date or Cash Merger Early Settlement Date, as the case may be), each
Holder will receive on the Purchase Contract Settlement Date, Early Settlement
Date or Cash Merger Early Settlement Date, as applicable, the aggregate amount
of Deferred Contract Adjustment Payments to the extent such fees are not
deducted from the Stated Amount in the case of a Cash Settlement or any Early
Settlement or Cash Merger Early Settlement.

The Purchase Contracts and all obligations and rights of the Company and the
Holders thereunder, including, without limitation, the rights of the Holders to
receive and the obligation of the Company to pay any Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly, but in no event later than two Business Days
thereafter, give written notice to the Purchase Contract Agent, the
Collateral Agent and the Holders, at their addresses as they appear in the
Security Register. Upon and after the occurrence of a Termination Event, the
Collateral Agent shall release the Senior Notes or the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as the case may be, from the Pledge in accordance
with the provisions of the Pledge Agreement.

         Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
represented by Units may be settled early at any time prior to 5:00 p.m. (New
York City time) on the fifth Business Day immediately preceding the Purchase
Contract Settlement Date ("EARLY SETTLEMENT") as provided in the Purchase
Contract Agreement. In order to exercise the right to effect Early Settlement
with respect to any Purchase Contract evidenced by this Certificate, the Holder
of this Corporate Units Certificate shall deliver to the Purchase Contract Agent
at the Corporate Trust Office an Election to Settle Early form set forth below
duly completed and accompanied by payment in the form of immediately available
funds payable to the order of the Company in an amount (the "EARLY SETTLEMENT
AMOUNT") equal to:

         (i) the sum of (A) the product of (I) the Stated Amount, times (II) the
number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement, plus (B) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date next preceding any Payment Date to the opening of business on such Payment
Date, an amount equal to the Contract Adjustment Payments payable on such
Payment Date with respect to such Purchase Contracts, less

         (ii) the amount of any Deferred Contract Adjustment Payments payable to
such Holder as a result of such Early Settlement.

         Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Pledged Senior Notes or Pledge Applicable Ownership Interests (as
specified in clause (i) of the

                                      A-13

<PAGE>

definition of such term) represented by such Units shall be released from the
Pledge as provided in the Pledge Agreement and the Holder shall be entitled to
receive a number of shares of Common Stock on account of each Purchase Contract
represented by a Corporate Unit as to which Early Settlement is effected equal
to 0.3501 shares of Common Stock per Purchase Contract (the "EARLY SETTLEMENT
RATE"). The Early Settlement Rate shall be adjusted in the same manner and at
the same time as the Settlement Rate is adjusted as provided in Section 5.04 of
the Purchase Contract Agreement.

         Upon the occurrence of a Cash Merger, a Holder of Corporate Units may
effect Cash Merger Early Settlement of the Purchase Contract represented by such
Corporate Units pursuant to the terms of Section 5.04(b)(2) of the Purchase
Contract Agreement. Upon Cash Merger Early Settlement of Purchase Contracts by a
Holder of the related Corporate Units, the Pledged Senior Notes or Pledged
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio represented by such Corporate Units shall
be released from the Pledge as provided in the Pledge Agreement.

         Upon registration of transfer of this Corporate Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Corporate Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.

         The Holder of this Corporate Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts represented by the Corporate Units evidenced hereby
on its behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform its obligations under such Purchase Contracts,
consents to the provisions of the Purchase Contract Agreement, authorizes the
Purchase Contract Agent to enter into and perform the Purchase Contract
Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to the Pledge of the Senior Notes or the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as the case may be, represented by this Corporate
Units Certificate pursuant to the Pledge Agreement. The Holder further covenants
and agrees that, to the extent and in the manner provided in the Purchase
Contract Agreement and the Pledge Agreement, but subject to the terms thereof,
payments with respect to the aggregate principal amount of the Pledged Senior
Notes or the appropriate Applicable Ownership Interests (as specified in clause
(i) of the definition of such term) in the Treasury Portfolio, as the case may
be, on the Purchase Contract Settlement Date shall be paid by

                                      A-14

<PAGE>

the Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.

         Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of not less than a
majority of the Outstanding Units.

         The Purchase Contracts shall be governed by, and construed in
accordance with, the laws of the State of New York.

         Prior to due presentment of this Certificate for registration of
transfer, the Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Corporate Units Certificate is registered as the owner of the
Corporate Units evidenced hereby for the purpose of receiving payments of
interest payable on the Senior Notes, receiving payments of Contract Adjustment
Payments (subject to any applicable record date), performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.

         The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.

         A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Purchase Contract Agent.

                                      A-15

<PAGE>

                                  ABBREVIATIONS

         The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM:                   as tenants in common
UNIF GIFT MIN ACT:         ______________________ Custodian ____________________
                                   (cust)                         (minor)

                           Under Uniform Gifts to Minors Act of  _______________
                           _____________________________________________________

TENANT:                    as tenants by the entireties

JT TEN:                    as joint tenants with right of survivorship and not
                           as tenants in common

Additional abbreviations may also be used though not in the above list.

                      __________________________________

  FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
                                      unto

________________________________________________________________________________
 (Please insert Social Security or Taxpayer I.D. or other Identifying Number of
                                   Assignee)

________________________________________________________________________________
  (Please Print or Type Name and Address Including Postal Zip Code of Assignee)

the within Corporate Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney __________________, to transfer
said Corporate Units Certificates on the books of The Chubb Corporation, with
full power of substitution in the premises.

Dated: __________________________       Signature ______________________________

                                        NOTICE: The signature to this assignment
                                        must correspond with the name as it
                                        appears upon the face of the within
                                        Corporate Units Certificates in every
                                        particular, without alteration or
                                        enlargement or any change whatsoever.

         Signature Guarantee: ________________________________________

                                      A-16

<PAGE>

                             SETTLEMENT INSTRUCTIONS

         The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts represented by the number of Corporate Units
evidenced by this Corporate Units Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.

Dated: ____________________________          ___________________________________
                                             Signature
                                             Signature Guarantee: ______________
                                             (if assigned to another person)

If shares are to be registered in the        REGISTERED HOLDER
name of and delivered to a Person other
than the Holder, please (i) print such
Person's name and address and (ii)           Please print name and address of
provide a guarantee of your signature:       Registered Holder:

______________________________________       ___________________________________
Name                                         Name

______________________________________       ___________________________________
Address                                      Address
______________________________________       ___________________________________
______________________________________       ___________________________________
______________________________________       ___________________________________

Social Security or other
Taxpayer Identification
Number, if any                               ___________________________________

                                      A-17

<PAGE>

              ELECTION TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT

         The undersigned Holder of this Corporate Units Certificate hereby
irrevocably exercises the option to effect [Early Settlement] [Cash Merger Early
Settlement following a Cash Merger] in accordance with the terms of the Purchase
Contract Agreement with respect to the Purchase Contracts represented by the
number of Corporate Units evidenced by this Corporate Units Certificate
specified below. The undersigned Holder directs that a certificate for shares of
Common Stock or other securities deliverable upon such [Early Settlement] [Cash
Merger Early Settlement] be registered in the name of, and delivered, together
with a check in payment for any fractional share and any Corporate Units
Certificate representing any Corporate Units evidenced hereby as to which [Early
Settlement] [Cash Merger Early Settlement] of the related Purchase Contracts is
not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below. Pledged Senior Notes or
the appropriate Applicable Ownership Interests in the Treasury Portfolio, as the
case may be, deliverable upon such [Early Settlement] [Cash Merger Early
Settlement] will be transferred in accordance with the transfer instructions set
forth below. If shares are to be registered in the name of a Person other than
the undersigned, the undersigned will pay any transfer tax payable incident
thereto.

Dated: _____________________________          __________________________________
                                              Signature

Signature Guarantee: _________________________

                                      A-18

<PAGE>

         Number of Units evidenced hereby as to which [Early Settlement] [Cash
Merger Early Settlement] of the related Purchase Contracts is being elected:

If shares of Common Stock or Corporate      REGISTERED HOLDER
Units Certificates are to be registered
in the name of and delivered to and
Pledged Senior Notes or the Applicable
Ownership Interests in the Treasury
Portfolio, as the case may be, are to
be transferred to a Person other than
the Holder, please print such Person's
name and address:

                                            Please print name and address of
                                            Registered Holder:

______________________________________      ____________________________________
Name                                        Name

______________________________________      ____________________________________
Address                                     Address
______________________________________      ____________________________________
______________________________________      ____________________________________
______________________________________      ____________________________________

Social Security or other
Taxpayer Identification

Number, if any                              ____________________________________

                                      A-19

<PAGE>

Transfer Instructions for Pledged Senior Notes or the Applicable Ownership
Interests in the Treasury Portfolio, as the case may be, transferable upon
[Early Settlement] [Cash Merger Early Settlement] or a Termination Event:

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

                                      A-20

<PAGE>

                     [TO BE ATTACHED TO GLOBAL CERTIFICATES]

            SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE

The following increases or decreases in this Global Certificate have been made:

<TABLE>
<CAPTION>
                                                                          Number of Corporate
                         Amount of increase in   Amount of decrease in  Units evidenced by this
                          Number of Corporate     Number of Corporate      Global Certificate    Signature of authorized
                        Units evidenced by the  Units evidenced by the      following such        signatory of Purchase
         Date             Global Certificate      Global Certificate     decrease or increase          Contract Agent
----------------------  ----------------------  ----------------------  -----------------------  -----------------------
<S>                     <C>                     <C>                     <C>                      <C>
----------------------  ----------------------  ----------------------  -----------------------  -----------------------

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

----------------------  ----------------------  ----------------------  -----------------------  -----------------------
</TABLE>

                                     A-21

<PAGE>

                                                                       EXHIBIT B

                   (FORM OF FACE OF TREASURY UNIT CERTIFICATE
           For Treasury Units containing Treasury securities maturing
                                on July 15, 2006)

         [For inclusion in Global Certificate only - THIS CERTIFICATE IS A
GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF CEDE & CO., AS NOMINEE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A
TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.

         UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

No. 1                                                      CUSIP No. 171232 60 6
Number of Treasury Units: 0

                              The Chubb Corporation
                                 Treasury Units

         This Treasury Units Certificate certifies that [Cede & Co.]
[__________________] is the registered Holder of the number of Treasury Units
set forth above [For inclusion in Global Certificates only - or such other
number of Treasury Units as is reflected in the Schedule of

                                     B-1

<PAGE>
 Increases or Decreases in the Global Certificate attached hereto]. Each
Treasury Unit represents (i) a 1/40 undivided beneficial ownership interest of a
Treasury Security having a principal amount at maturity equal to $1,000, subject
to the Pledge of such Treasury Security by such Holder pursuant to the Pledge
Agreement, and (ii) the rights and obligations of the Holder under one Purchase
Contract with The Chubb Corporation, a New Jersey corporation (the "COMPANY").
All capitalized terms used herein which are defined in the Purchase Contract
Agreement (as defined on the reverse hereof) have the meaning set forth therein.

         Pursuant to the Pledge Agreement, the Treasury Securities represented
by each Treasury Unit evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract represented by such Treasury Unit. Each Purchase
Contract evidenced hereby obligates the Holder of this Treasury Units
Certificate to purchase, and the Company to sell, on August 16, 2006 (the
"PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00 (the "STATED
AMOUNT"), a number of newly issued shares of common stock, par value $1.00 per
share ("COMMON STOCK"), of the Company, equal to the Settlement Rate, unless on
or prior to the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement or Cash Merger Early Settlement with
respect to such Purchase Contract, all as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof. The Stated Amount for
the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract
Settlement Date by application of the proceeds from the Treasury Securities at
maturity pledged to secure the obligations of the Holder under such Purchase
Contract of the Treasury Units of which such Purchase Contract is a part.

         Each Purchase Contract evidenced hereby obligates the holder to agree,
for United States federal, state and local tax purposes, to (i) treat an
acquisition of the Treasury Units as an acquisition of the Treasury Securities
and Purchase Contracts represented by the Treasury Units and (ii) treat itself
as owner of the applicable interest in the Collateral Account, including the
Treasury Securities.

         The Company shall pay, on each Payment Date, in respect of each
Purchase Contract represented by a Treasury Unit evidenced hereby, an amount
(the "CONTRACT ADJUSTMENT PAYMENTS") equal to 4.75% per year of the Stated
Amount. Such Contract Adjustment Payments shall be payable to the Person in
whose name this Treasury Units Certificate is registered at the close of
business on the Record Date for such Payment Date. The Company may, at its
option, defer such Contract Adjustment Payments.

         Contract Adjustment Payments will be payable at the office of the
Purchase Contract Agent in New York City. If the book-entry system for the
Treasury Units has been terminated, the Contract Adjustment Payments will be
payable, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such Person's address as it appears on the Security
Register, or by wire transfer to the account designated by such Person by a
prior written notice to the Purchase Contract Agent.

                                       B-2

<PAGE>

         Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.

         Unless the certificate of authentication hereon has been executed by
the Purchase Contract Agent by manual signature, this Treasury Units Certificate
shall not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.

                                       B-3

<PAGE>

         IN WITNESS WHEREOF, the Company and the Holder specified above have
caused this instrument to be duly executed.

                                        The Chubb Corporation

                                        By:_____________________________________
                                           Name:
                                           Title:

                                        HOLDER SPECIFIED ABOVE (as to
                                        obligations of such Holder under the
                                        Purchase Contracts)

                                        By: BANK ONE TRUST COMPANY,
                                        N.A., not individually but solely as
                                        Attorney-in-Fact of such Holder

                                        By: ____________________________________
                                            Authorized Officer

Dated:_____________________

                                       B-4

<PAGE>

                        CERTIFICATE OF AUTHENTICATION OF
                             PURCHASE CONTRACT AGENT

         This is one of the Treasury Units referred to in the within-mentioned
Purchase Contract Agreement.

                                        By: BANK ONE TRUST COMPANY, N.A.,
                                             as Purchase Contract Agent

                                        By: ____________________________________
                                            Authorized Officer
Dated:_________________

                                       B-5

<PAGE>

                     (REVERSE OF TREASURY UNIT CERTIFICATE)

         Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of June 24, 2003 (as may be supplemented from time
to time, the "PURCHASE CONTRACT AGREEMENT") between the Company and Bank One
Trust Company, N.A., as Purchase Contract Agent (including its successors
thereunder, herein called the "PURCHASE CONTRACT AGENT"), to which the Purchase
Contract Agreement and supplemental agreements thereto reference is hereby made
for a description of the respective rights, limitations of rights, obligations,
duties and immunities thereunder of the Purchase Contract Agent, the Company and
the Holders and of the terms upon which the Treasury Units Certificates are, and
are to be, executed and delivered.

         Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury Units Certificate to purchase, and the Company to sell, on August 16,
2006 (the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00 (the
"STATED AMOUNT"), a number of newly issued shares of common stock, par value
$1.00 per share ("COMMON STOCK"), of the Company, equal to the Settlement Rate,
unless on or prior to the Purchase Contract Settlement Date there shall have
occurred a Termination Event or an Early Settlement or Cash Merger Early
Settlement with respect to such Purchase Contract. The "SETTLEMENT RATE" is
equal to:

         (1) if the Adjusted Applicable Market Value (as defined below) is
greater than $71.40 (the "THRESHOLD APPRECIATION PRICE"), 0.3501 shares of
Common Stock per Purchase Contract;

         (2) if the Adjusted Applicable Market Value is less than or equal to
the Threshold Appreciation Price but greater than or equal to $59.50 (the
"REFERENCE PRICE"), the number of shares of Common Stock per Purchase Contract
having a value equal to the Stated Amount divided by the Adjusted Applicable
Market Value; and

         (3) if the Adjusted Applicable Market Value is less than the Reference
Price, 0.4202 shares of Common Stock per Purchase Contract;

         in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).

         No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.

         Each Purchase Contract evidenced hereby, which is settled through Early
Settlement or Cash Merger Early Settlement shall obligate the Holder of the
related Treasury Units to purchase at the Stated Amount, and the Company to
sell, a number of newly issued shares of Common Stock equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).

                                       B-6

<PAGE>

         The "APPLICABLE MARKET VALUE" means the average of the Closing Prices
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date, subject to adjustments set forth under Section 5.04 hereof.

         The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any
adjustment of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement, the
Applicable Market Value, and (ii) at the time of and after any adjustment of the
Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10)
of Section 5.04(a) of the Purchase Contract Agreement, the Applicable Market
Value multiplied by a fraction, the numerator of which shall be the Settlement
Rate immediately after such adjustment pursuant to paragraph (1), (2), (3), (4),
(5), (6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement and
the denominator of which shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.

         The "CLOSING PRICE" per share of Common Stock on any date of
determination means the:

         (1) closing sale price as of the close of the principal trading session
(or, if no closing price is reported, the last reported sale price) per share on
the New York Stock Exchange, Inc. (the "NYSE") on such date;

         (2) if the Common Stock is not listed for trading on the NYSE on any
such date, the closing sale price (or, if no closing price is reported, the last
reported sale price) per share as reported in the composite transactions for the
principal United States national or regional securities exchange on which the
Common Stock is so listed;

         (3) if the Common Stock is not so listed on a United States national or
regional securities exchange, the last reported sale price per share as reported
by The Nasdaq National Market, Inc.;

         (4) if the Common Stock is not so reported by the Nasdaq National
Market, Inc. the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization; or

         (5) if such bid price, referred to in clause (4), is not available, the
market value of the Common Stock on such date as determined by a nationally
recognized independent investment banking firm retained for this purpose by the
Company.

                                       B-7

<PAGE>

         A "TRADING DAY" means a day on which the Common Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.

         In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Treasury Unit shall pay the Stated Amount for the shares of the
Common Stock purchased pursuant to each Purchase Contract evidenced hereby
either by effecting a Cash Settlement, an Early Settlement or, if applicable, a
Cash Merger Early Settlement of each such Purchase Contract or by applying a
principal amount of the Pledged Treasury Securities represented by such Holder's
Treasury Unit equal to the Stated Amount of such Purchase Contract to the
purchase of the Common Stock. A Holder of Treasury Units who (1) does not on or
prior to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, notify the Purchase Contract
Agent of its intention to effect a Cash Settlement, or who does so notify the
Purchase Contract Agent but fails to make an effective Cash Settlement prior to
5:00 p.m. (New York City time) on the fourth Business Day immediately preceding
the Purchase Contract Settlement Date, (2) on or prior to 5:00 p.m. (New York
City time) on the fifth Business Day prior to the Purchase Contract Settlement
Date, does not make an effective Early Settlement, or (3) on or prior to 5:00
p.m. (New York City time) on the fifth Business Day prior to the Purchase
Contract Settlement Date, does not make an effective Cash Merger Early
Settlement, shall pay the Stated Amount for the shares of Common Stock to be
issued under the related Purchase Contract from the proceeds of the Pledged
Treasury Securities.

         The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate Stated Amount for
the shares of Common Stock to be purchased thereunder in the manner set forth in
the Purchase Contract Agreement.

         The Company has the right to defer payment of all or part of the
Contract Adjustment Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date (or in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early Settlement Date or
Cash Merger Early Settlement Date, as the case may be). If the Company so elects
to defer Contract Adjustment Payments, the Company shall pay additional Contract
Adjustment Payments on such deferred installments of Purchase Contract Payments
at a rate equal to 7.00% per annum, compounding on each succeeding Payment Date,
until such deferred installments are paid. In the event that the Company elects
to defer the payment of Contract Adjustment Payments on the Purchase Contracts
until the Purchase Contract Settlement Date (or, in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early Settlement Date or
Cash Merger Early Settlement, as the case may be), each Holder will receive on

                                       B-8

<PAGE>

the Purchase Contract Settlement Date or Early Settlement Date, as applicable,
the aggregate amount of Deferred Contract Adjustment Payments to the extent such
fees are not deducted from the Stated Amount in the case of a Cash Settlement or
any Early Settlement or Cash Merger Early Settlement.

         The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Purchase Contract Agent or
the Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly, but in no event later than two Business Days
thereafter, give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Pledged Treasury Securities (as defined in the Pledge
Agreement) represented by each Treasury Unit. A Treasury Unit shall thereafter
represent the right to receive the Proceeds of the Treasury Security represented
by such Treasury Unit, in accordance with the terms of the Purchase Contract
Agreement and the Pledge Agreement.

         The Treasury Units Certificates are issuable only in registered form
and only in denominations of a single Treasury Unit and any integral multiple
thereof. The transfer of any Treasury Units Certificate will be registered and
Treasury Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Security Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Purchase
Contract Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute Senior Notes for Treasury Securities, thereby recreating Corporate
Units, shall be responsible for any fees or expenses associated therewith.
Except as provided in the Purchase Contract Agreement, for so long as the
Purchase Contract represented by a Treasury Unit remains in effect, such
Treasury Unit shall not be separable into its constituent parts, and the rights
and obligations of the Holder of such Treasury Unit in respect of the Treasury
Security and the Purchase Contract represented by such Treasury Unit may be
transferred and exchanged only as a Treasury Unit.

         Unless the Treasury Portfolio has replaced the Senior Notes represented
by the Corporate Units and subject to the conditions set forth in the Purchase
Contract Agreement, a Holder of Treasury Units may recreate, at any time prior
to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, Corporate Units by delivering
to the Securities Intermediary Senior Notes with an aggregate principal amount,
equal to the aggregate principal amount at maturity of the Pledged Treasury
Securities in exchange for the release of such Pledged Treasury Securities in
accordance with the terms of the Purchase

                                     B-9

<PAGE>

Contract Agreement and the Pledge Agreement. From and after such substitution,
the Holder's Units shall be referred to as a "CORPORATE UNIT". Any such creation
of Corporate Units may be effected only in multiples of 40 Treasury Units for 40
Corporate Units.

         If the Treasury Portfolio has replaced the Senior Notes represented by
the Corporate Units, a Holder may at any time on or prior to the second Business
Day immediately preceding the Purchase Contract Settlement Date substitute the
Applicable Ownership Interests in the Treasury Portfolio for Treasury
Securities, but only in integral multiples of 64,000 Treasury Units. In such
event, the Holder shall transfer to the Collateral Agent the Applicable
Ownership Interest in the Treasury Portfolio in an amount such that the
aggregate principal amount at maturity of the portion of such Applicable
Ownership Interest in the Treasury Portfolio (as specified in clause (i) of the
definition of such term) is equal to the aggregate Stated Amount of the Purchase
Contracts underlying such Treasury Units, and the Purchase Contract Agent shall
instruct the Collateral Agent to release the Pledge of and transfer to the
Holder the Treasury Securities.

         The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Treasury Units Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Holder, by check mailed
to the address of the Person entitled thereto at such address as it appears on
the Security Register.

         The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Purchase Contract Agent or
the Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Treasury Securities from the Pledge in accordance with
the provisions of the Pledge Agreement. A Treasury Unit shall thereafter
represent the right to receive the interest in the Treasury Security represented
by such Treasury Unit, in accordance with the terms of the Purchase Contract
Agreement and the Pledge Agreement.

         Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
represented by Units may be settled early ("EARLY SETTLEMENT") as provided in
the Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contract evidenced by this Certificate,
the Holder of this Treasury Units Certificate shall deliver to the Purchase
Contract Agent at the Corporate Trust Office an Election to Settle Early form
set forth below duly

                                      B-10

<PAGE>

completed and accompanied by payment in the form of immediately available funds
payable to the order of the Company in an amount (the "EARLY SETTLEMENT AMOUNT")
equal to:

         (i) the sum of (A) the product of (I) the Stated Amount, times (II) the
number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement, plus (B) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date next preceding any Payment Date to the opening of business on such Payment
Date, an amount equal to the Contract Adjustment Payments payable on such
Payment Date with respect to such Purchase Contracts, less

         (ii) the amount of any Deferred Contract Adjustment Payments payable to
such Holder as a result of such Early Settlement.

         Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Pledged Treasury Securities represented by such Units shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Common Stock on account of
each Purchase Contract represented by a Treasury Unit as to which Early
Settlement is effected equal to 0.3501 shares of Common Stock per Purchase
Contract (the "EARLY SETTLEMENT RATE"). The Early Settlement Rate shall be
adjusted in the same manner and at the same time as the Settlement Rate is
adjusted as provided in Section 5.04 of the Purchase Contract Agreement.

         Upon the occurrence of a Cash Merger, a Holder of Treasury Units may
effect Cash Merger Early Settlement of the Purchase Contract represented by such
Treasury Units pursuant to the terms of Section 5.04(b)(2) of the Purchase
Contract Agreement. Upon Cash Merger Early Settlement of Purchase Contracts by a
Holder of the related Treasury Units, the Pledged Treasury Securities
represented by such Treasury Units shall be released from the Pledge as provided
in the Pledge Agreement.

         Upon registration of transfer of this Treasury Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Treasury Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.

         The Holder of this Treasury Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts represented by the Treasury Units evidenced hereby on
its behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code,

                                      B-11

<PAGE>

agrees to be bound by the terms and provisions thereof, covenants and agrees to
perform its obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Purchase Contract
Agent to enter into and perform the Purchase Contract Agreement and the Pledge
Agreement on its behalf as its attorney-in-fact, and consents to the Pledge of
the Treasury Securities represented by this Treasury Units Certificate pursuant
to the Pledge Agreement. The Holder further covenants and agrees, that, to the
extent and in the manner provided in the Purchase Contract Agreement and the
Pledge Agreement, but subject to the terms thereof, payments in respect to the
aggregate principal amount of the Pledged Treasury Securities on the Purchase
Contract Settlement Date shall be paid by the Collateral Agent to the Company in
satisfaction of such Holder's obligations under such Purchase Contract and such
Holder shall acquire no right, title or interest in such payments.

         Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of not less than a
majority of the Outstanding Units.

         The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.

         Prior to due presentment of this Certificate for registration or
transfer, the Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Treasury Units Certificate is registered as the owner of the
Treasury Units evidenced hereby for the purpose of receiving payments of
interest on the Treasury Securities, receiving payments of Contract Adjustment
Payments (subject to any applicable record date), performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.

         The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.

         A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Purchase Contract Agent.

                                      B-12

<PAGE>

                                  ABBREVIATIONS

         The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM:                   as tenants in common

UNIF GIFT MIN ACT:         ______________________ Custodian ____________________
                                  (cust)                           (minor)

                           Under Uniform Gifts to Minors Act of ________________
                           _____________________________________________________

TENANT:                    as tenants by the entireties

JT TEN:                    as joint tenants with right of survivorship and not
                           as tenants in common

Additional abbreviations may also be used though not in the above list.

                       ________________________________

 FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
                                      unto

________________________________________________________________________________
 (Please insert Social Security or Taxpayer I.D. or other Identifying Number of
                                    Assignee)

________________________________________________________________________________
  (Please Print or Type Name and Address Including Postal Zip Code of Assignee)

the within Treasury Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ____________ attorney to transfer said
Treasury Units Certificates on the books of The Chubb Corporation, with full
power of substitution in the premises.

Dated: _____________________________       _____________________________________
                                           Signature

                                           NOTICE: The signature to this
                                           assignment must correspond with the
                                           name as it appears upon the face of
                                           the within Treasury Units
                                           Certificates in every particular,
                                           without alteration or enlargement or
                                           any change whatsoever.

         Signature Guarantee: __________________________________

                                      B-13

<PAGE>

                             SETTLEMENT INSTRUCTIONS

         The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts represented by the number of Treasury Units
evidenced by this Treasury Units Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.

Dated: ________________________________  ______________________________________
                                         Signature
                                         Signature Guarantee: _________________
                                         (if assigned to another person)

If shares are to be registered in the    REGISTERED HOLDER
name of and delivered to a Person other
than the Holder, please (i) print such
Person's name and address and (ii)
provide a guarantee of your signature:

                                         Please print name and address of
                                         Registered Holder:

_______________________________________  ______________________________________
Name                                     Name

_______________________________________  ______________________________________
Address                                  Address
_______________________________________  ______________________________________
_______________________________________  ______________________________________
_______________________________________  ______________________________________

Social Security or other
Taxpayer Identification                  ______________________________________
Number, if any

                                      B-14

<PAGE>

              ELECTION TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT

         The undersigned Holder of this Treasury Units Certificate hereby
irrevocably exercises the option to effect [Early Settlement] [Cash Merger Early
Settlement upon a Cash Merger] in accordance with the terms of the Purchase
Contract Agreement with respect to the Purchase Contracts represented by the
number of Treasury Units evidenced by this Treasury Units Certificate specified
below. The option to effect [Early Settlement] [Cash Merger Early Settlement]
may be exercised only with respect to Purchase Contracts represented by Treasury
Units with an aggregate Stated Amount equal to $1,000 or an integral multiple
thereof. The undersigned Holder directs that a certificate for shares of Common
Stock or other securities deliverable upon such [Early Settlement] [Cash Merger
Early Settlement] be registered in the name of, and delivered, together with a
check in payment for any fractional share and any Treasury Units Certificate
representing any Treasury Units evidenced hereby as to which Cash Merger Early
Settlement of the related Purchase Contracts is not effected, to the undersigned
at the address indicated below unless a different name and address have been
indicated below. Pledged Treasury Securities deliverable upon such [Early
Settlement] [Cash Merger Early Settlement] will be transferred in accordance
with the transfer instructions set forth below. If shares are to be registered
in the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.

Dated: _____________________________         ___________________________________
                                             Signature

Signature Guarantee: ______________________________

                                      B-15

<PAGE>

         Number of Units evidenced hereby as to which [Early Settlement] [Cash
Merger Early Settlement] of the related Purchase Contracts is being elected:

If shares of Common Stock or Treasury   REGISTERED HOLDER
Units Certificates are to be
registered in the name of and
delivered to and Pledged Treasury
Securities are to be transferred to a
Person other than the Holder, please
print such Person's name and address:

                                        Please print name and address of
                                        Registered Holder:

______________________________________  ________________________________________
Name                                    Name

______________________________________  ________________________________________
Address                                 Address
______________________________________  ________________________________________
______________________________________  ________________________________________
______________________________________  ________________________________________

Social Security or other
Taxpayer Identification

Number, if any                          ________________________________________

                                      B-16

<PAGE>

Transfer Instructions for Pledged Treasury Securities Transferable upon [Early
Settlement] [Cash Merger Early Settlement] or a Termination Event:

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

                                      B-17

<PAGE>

                     [TO BE ATTACHED TO GLOBAL CERTIFICATES]

            SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE

The following increases or decreases in this Global Certificate have been made:

<TABLE>
<CAPTION>
                                                                          Number of Treasury
                         Amount of increase in   Amount of decrease in  Units evidenced by this
                          Number of Treasury      Number of Treasury       Global Certificate    Signature of authorized
                        Units evidenced by the  Units evidenced by the      following such        signatory of Purchase
Date                      Global Certificate      Global Certificate     decrease or increase          Contract Agent
----------------------  ----------------------  ----------------------  -----------------------  -----------------------
<S>                     <C>                     <C>                     <C>                      <C>

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

----------------------- ----------------------- ----------------------- ----------------------- -----------------------
</TABLE>

                                      B-18

<PAGE>

                                                                       EXHIBIT C

                   (FORM OF FACE OF TREASURY UNIT CERTIFICATE
                For Treasury Units containing Treasury Securities
                          maturing on August 15, 2006)

[For inclusion in Global Certificate only - THIS CERTIFICATE IS A GLOBAL
CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF CEDE & CO., AS NOMINEE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A
TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

No. 2                                                      CUSIP No. 171232 70 5
Number of Treasury Units: 0

                              The Chubb Corporation
                                 Treasury Units

         This Treasury Units Certificate certifies that [Cede & Co.]
[__________________] is the registered Holder of the number of Treasury Units
set forth above [For inclusion in Global Certificates only - or such other
number of Treasury Units as is reflected in the Schedule of Increases or
Decreases in the Global Certificate attached hereto]. Each Treasury Unit
represents (i) a 1/40 undivided beneficial ownership interest of a Treasury
Security having a principal amount at maturity equal to $1,000, subject to the
Pledge of such Treasury Security by such Holder

                                       C-1

<PAGE>

pursuant to the Pledge Agreement, and (ii) the rights and obligations of the
Holder under one Purchase Contract with The Chubb Corporation, a New Jersey
corporation (the "COMPANY"). All capitalized terms used herein which are defined
in the Purchase Contract Agreement (as defined on the reverse hereof) have the
meaning set forth therein.

         Pursuant to the Pledge Agreement, the Treasury Securities represented
by each Treasury Unit evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract represented by such Treasury Unit. Each Purchase
Contract evidenced hereby obligates the Holder of this Treasury Units
Certificate to purchase, and the Company to sell, on August 16, 2006 (the
"PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00 (the "STATED
AMOUNT"), a number of newly issued shares of common stock, par value $1.00 per
share ("COMMON STOCK"), of the Company, equal to the Settlement Rate, unless on
or prior to the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement or Cash Merger Early Settlement with
respect to such Purchase Contract, all as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof. The Stated Amount for
the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract
Settlement Date by application of the proceeds from the Treasury Securities at
maturity pledged to secure the obligations of the Holder under such Purchase
Contract of the Treasury Units of which such Purchase Contract is a part.

         Each Purchase Contract evidenced hereby obligates the holder to agree,
for United States federal, state and local tax purposes, to (i) treat an
acquisition of the Treasury Units as an acquisition of the Treasury Securities
and Purchase Contracts represented by the Treasury Units and (ii) treat itself
as owner of the applicable interest in the Collateral Account, including the
Treasury Securities.

         The Company shall pay, on each Payment Date, in respect of each
Purchase Contract represented by a Treasury Unit evidenced hereby, an amount
(the "CONTRACT ADJUSTMENT PAYMENTS") equal to 4.75% per year of the Stated
Amount. Such Contract Adjustment Payments shall be payable to the Person in
whose name this Treasury Units Certificate is registered at the close of
business on the Record Date for such Payment Date. The Company may, at its
option, defer such Contract Adjustment Payments.

         Contract Adjustment Payments will be payable at the office of the
Purchase Contract Agent in New York City. If the book-entry system for the
Treasury Units has been terminated, the Contract Adjustment Payments will be
payable, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such Person's address as it appears on the Security
Register, or by wire transfer to the account designated by such Person by a
prior written notice to the Purchase Contract Agent.

         Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.

                                       C-2

<PAGE>

         Unless the certificate of authentication hereon has been executed by
the Purchase Contract Agent by manual signature, this Treasury Units Certificate
shall not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.

                                       C-3

<PAGE>

         IN WITNESS WHEREOF, the Company and the Holder specified above have
caused this instrument to be duly executed.

                                        The Chubb Corporation

                                        By:_____________________________________
                                           Name:
                                           Title:

                                        HOLDER SPECIFIED ABOVE (as to
                                        obligations of such Holder under the
                                        Purchase Contracts)

                                        By: BANK ONE TRUST COMPANY,
                                        N.A., not individually but solely as
                                        Attorney-in-Fact of such Holder

                                        By: ____________________________________
                                            Authorized Officer

Dated:_____________________

                                       C-4

<PAGE>

                        CERTIFICATE OF AUTHENTICATION OF
                             PURCHASE CONTRACT AGENT

         This is one of the Treasury Units referred to in the within-mentioned
Purchase Contract Agreement.

                                        By: BANK ONE TRUST COMPANY, N.A.,
                                             as Purchase Contract Agent

                                        By: ____________________________________
                                            Authorized Officer
Dated:_________________

                                       C-5

<PAGE>

                     (REVERSE OF TREASURY UNIT CERTIFICATE)

         Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of June 24, 2003 (as may be supplemented from time
to time, the "PURCHASE CONTRACT AGREEMENT") between the Company and Bank One
Trust Company, N.A., as Purchase Contract Agent (including its successors
thereunder, herein called the "PURCHASE CONTRACT AGENT"), to which the Purchase
Contract Agreement and supplemental agreements thereto reference is hereby made
for a description of the respective rights, limitations of rights, obligations,
duties and immunities thereunder of the Purchase Contract Agent, the Company and
the Holders and of the terms upon which the Treasury Units Certificates are, and
are to be, executed and delivered.

         Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury Units Certificate to purchase, and the Company to sell, on August 16,
2006 (the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25.00 (the
"STATED AMOUNT"), a number of newly issued shares of common stock, par value
$1.00 per share ("COMMON STOCK"), of the Company, equal to the Settlement Rate,
unless on or prior to the Purchase Contract Settlement Date there shall have
occurred a Termination Event or an Early Settlement or Cash Merger Early
Settlement with respect to such Purchase Contract. The "SETTLEMENT RATE" is
equal to:

         (1) if the Adjusted Applicable Market Value (as defined below) is
greater than $71.40 (the "THRESHOLD APPRECIATION PRICE"), 0.3501 shares of
Common Stock per Purchase Contract;

         (2) if the Adjusted Applicable Market Value is less than or equal to
the Threshold Appreciation Price but greater than or equal to $59.50 (the
"REFERENCE PRICE"), the number of shares of Common Stock per Purchase Contract
having a value equal to the Stated Amount divided by the Adjusted Applicable
Market Value; and

         (3) if the Adjusted Applicable Market Value is less than the Reference
Price, 0.4202 shares of Common Stock per Purchase Contract;

         in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).

         No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.

         Each Purchase Contract evidenced hereby, which is settled through Early
Settlement or Cash Merger Early Settlement shall obligate the Holder of the
related Treasury Units to purchase at the Stated Amount, and the Company to
sell, a number of newly issued shares of Common Stock equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).

                                       C-6

<PAGE>

         The "APPLICABLE MARKET VALUE" means the average of the Closing Prices
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date, subject to adjustments set forth under Section 5.04 hereof.

         The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any
adjustment of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement, the
Applicable Market Value, and (ii) at the time of and after any adjustment of the
Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10)
of Section 5.04(a) of the Purchase Contract Agreement, the Applicable Market
Value multiplied by a fraction, the numerator of which shall be the Settlement
Rate immediately after such adjustment pursuant to paragraph (1), (2), (3), (4),
(5), (6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement and
the denominator of which shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.

         The "CLOSING PRICE" per share of Common Stock on any date of
determination means the:

         (1) closing sale price as of the close of the principal trading session
(or, if no closing price is reported, the last reported sale price) per share on
the New York Stock Exchange, Inc. (the "NYSE") on such date;

         (2) if the Common Stock is not listed for trading on the NYSE on any
such date, the closing sale price (or, if no closing price is reported, the last
reported sale price) per share as reported in the composite transactions for the
principal United States national or regional securities exchange on which the
Common Stock is so listed;

         (3) if the Common Stock is not so listed on a United States national or
regional securities exchange, the last reported sale price per share as reported
by The Nasdaq National Market, Inc.;

         (4) if the Common Stock is not so reported by the Nasdaq National
Market, Inc., the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization; or

         (5) if such bid price, referred to in clause (4), is not available, the
market value of the Common Stock on such date as determined by a nationally
recognized independent investment banking firm retained for this purpose by the
Company.

                                       C-7

<PAGE>

         A "TRADING DAY" means a day on which the Common Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.

         In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Treasury Unit shall pay the Stated Amount for the shares of the
Common Stock purchased pursuant to each Purchase Contract evidenced hereby
either by effecting a Cash Settlement, an Early Settlement or, if applicable, a
Cash Merger Early Settlement of each such Purchase Contract or by applying a
principal amount of the Pledged Treasury Securities represented by such Holder's
Treasury Unit equal to the Stated Amount of such Purchase Contract to the
purchase of the Common Stock. A Holder of Treasury Units who (1) does not on or
prior to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, notify the Purchase Contract
Agent of its intention to effect a Cash Settlement, or who does so notify the
Purchase Contract Agent but fails to make an effective Cash Settlement prior to
5:00 p.m. (New York City time) on the fourth Business Day immediately preceding
the Purchase Contract Settlement Date, (2) on or prior to 5:00 p.m. (New York
City time) on the fifth Business Day prior to the Purchase Contract Settlement
Date, does not make an effective Early Settlement, or (3) on or prior to 5:00
p.m. (New York City time) on the fifth Business Day prior to the Purchase
Contract Settlement Date, does not make an effective Cash Merger Early
Settlement, shall pay the Stated Amount for the shares of Common Stock to be
issued under the related Purchase Contract from the proceeds of the Pledged
Treasury Securities.

         The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate Stated Amount for
the shares of Common Stock to be purchased thereunder in the manner set forth in
the Purchase Contract Agreement.

         The Company has the right to defer payment of all or part of the
Contract Adjustment Payments in respect of each Purchase Contract until no later
than the Purchase Contract Settlement Date (or in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early Settlement Date or
Cash Merger Early Settlement Date, as the case may be). If the Company so elects
to defer Contract Adjustment Payments, the Company shall pay additional Contract
Adjustment Payments on such deferred installments of Purchase Contract Payments
at a rate equal to 7.00% per annum, compounding on each succeeding Payment Date,
until such deferred installments are paid. In the event that the Company elects
to defer the payment of Contract Adjustment Payments on the Purchase Contracts
until the Purchase Contract Settlement Date (or, in the event of an effective
Early Settlement or Cash Merger Early Settlement, the Early Settlement Date or
Cash Merger Early Settlement, as the case may be), each Holder will receive on

                                       C-8

<PAGE>

the Purchase Contract Settlement Date or Early Settlement Date, as applicable,
the aggregate amount of Deferred Contract Adjustment Payments to the extent such
fees are not deducted from the Stated Amount in the case of a Cash Settlement or
any Early Settlement or Cash Merger Early Settlement.

         The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Purchase Contract Agent or
the Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly, but in no event later than two Business Days
thereafter, give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Pledged Treasury Securities (as defined in the Pledge
Agreement) represented by each Treasury Unit. A Treasury Unit shall thereafter
represent the right to receive the Proceeds of the Treasury Security represented
by such Treasury Unit, in accordance with the terms of the Purchase Contract
Agreement and the Pledge Agreement.

         The Treasury Units Certificates are issuable only in registered form
and only in denominations of a single Treasury Unit and any integral multiple
thereof. The transfer of any Treasury Units Certificate will be registered and
Treasury Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Security Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Purchase
Contract Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute Senior Notes for Treasury Securities, thereby recreating Corporate
Units, shall be responsible for any fees or expenses associated therewith.
Except as provided in the Purchase Contract Agreement, for so long as the
Purchase Contract represented by a Treasury Unit remains in effect, such
Treasury Unit shall not be separable into its constituent parts, and the rights
and obligations of the Holder of such Treasury Unit in respect of the Treasury
Security and the Purchase Contract represented by such Treasury Unit may be
transferred and exchanged only as a Treasury Unit.

         Unless the Treasury Portfolio has replaced the Senior Notes represented
by the Corporate Units and subject to the conditions set forth in the Purchase
Contract Agreement, a Holder of Treasury Units may recreate, at any time prior
to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, Corporate Units by delivering
to the Securities Intermediary Senior Notes with an aggregate principal amount,
equal to the aggregate principal amount at maturity of the Pledged Treasury
Securities in exchange for the release of such Pledged Treasury Securities in
accordance with the terms of the Purchase

                                       C-9

<PAGE>

Contract Agreement and the Pledge Agreement. From and after such substitution,
the Holder's Units shall be referred to as a "CORPORATE UNIT". Any such creation
of Corporate Units may be effected only in multiples of 40 Treasury Units for 40
Corporate Units.

         If the Treasury Portfolio has replaced the Senior Notes represented by
the Corporate Units, a Holder may at any time on or prior to the second Business
Day immediately preceding the Purchase Contract Settlement Date substitute the
Applicable Ownership Interests in the Treasury Portfolio for Treasury
Securities, but only in integral multiples of 64,000 Treasury Units. In such
event, the Holder shall transfer to the Collateral Agent the Applicable
Ownership Interest in the Treasury Portfolio in an amount such that the
aggregate principal amount at maturity of the portion of such Applicable
Ownership Interests in the Treasury Portfolio (as specified in clause (i) of the
definition of such term) is equal to the aggregate Stated Amount of the Purchase
Contracts underlying such Treasury Units, and the Purchase Contract Agent shall
instruct the Collateral Agent to release the Pledge of and transfer to the
Holder the Treasury Securities.

         The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Treasury Units Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Holder, by check mailed
to the address of the Person entitled thereto at such address as it appears on
the Security Register.

         The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Purchase Contract Agent or
the Company, if, on or prior to the Purchase Contract Settlement Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Treasury Securities from the Pledge in accordance with
the provisions of the Pledge Agreement. A Treasury Unit shall thereafter
represent the right to receive the interest in the Treasury Security represented
by such Treasury Unit, in accordance with the terms of the Purchase Contract
Agreement and the Pledge Agreement.

         Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
represented by Units may be settled early ("EARLY SETTLEMENT") as provided in
the Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contract evidenced by this Certificate,
the Holder of this Treasury Units Certificate shall deliver to the Purchase
Contract Agent at the Corporate Trust Office an Election to Settle Early form
set forth below duly

                                      C-10

<PAGE>

completed and accompanied by payment in the form of immediately available funds
payable to the order of the Company in an amount (the "EARLY SETTLEMENT AMOUNT")
equal to:

         (i) the sum of (A) the product of (I) the Stated Amount, times (II) the
number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement, plus (B) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date next preceding any Payment Date to the opening of business on such Payment
Date, an amount equal to the Contract Adjustment Payments payable on such
Payment Date with respect to such Purchase Contracts, less

         (ii) the amount of any Deferred Contract Adjustment Payments payable to
such Holder as a result of such Early Settlement.

         Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Pledged Treasury Securities represented by such Units shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Common Stock on account of
each Purchase Contract represented by a Treasury Unit as to which Early
Settlement is effected equal to 0.3501 shares of Common Stock per Purchase
Contract (the "EARLY SETTLEMENT RATE"). The Early Settlement Rate shall be
adjusted in the same manner and at the same time as the Settlement Rate is
adjusted as provided in Section 5.04 of the Purchase Contract Agreement.

         Upon the occurrence of a Cash Merger, a Holder of Treasury Units may
effect Cash Merger Early Settlement of the Purchase Contract represented by such
Treasury Units pursuant to the terms of Section 5.04(b)(2) of the Purchase
Contract Agreement. Upon Cash Merger Early Settlement of Purchase Contracts by a
Holder of the related Treasury Units, the Pledged Treasury Securities
represented by such Treasury Units shall be released from the Pledge as provided
in the Pledge Agreement.

         Upon registration of transfer of this Treasury Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Treasury Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.

         The Holder of this Treasury Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts represented by the Treasury Units evidenced hereby on
its behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code,

                                      C-11

<PAGE>

agrees to be bound by the terms and provisions thereof, covenants and agrees to
perform its obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Purchase Contract
Agent to enter into and perform the Purchase Contract Agreement and the Pledge
Agreement on its behalf as its attorney-in-fact, and consents to the Pledge of
the Treasury Securities represented by this Treasury Units Certificate pursuant
to the Pledge Agreement. The Holder further covenants and agrees, that, to the
extent and in the manner provided in the Purchase Contract Agreement and the
Pledge Agreement, but subject to the terms thereof, payments in respect to the
aggregate principal amount of the Pledged Treasury Securities on the Purchase
Contract Settlement Date shall be paid by the Collateral Agent to the Company in
satisfaction of such Holder's obligations under such Purchase Contract and such
Holder shall acquire no right, title or interest in such payments.

         Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of not less than a
majority of the Outstanding Units.

         The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.

         Prior to due presentment of this Certificate for registration or
transfer, the Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Treasury Units Certificate is registered as the owner of the
Treasury Units evidenced hereby for the purpose of receiving payments of
interest on the Treasury Securities, receiving payments of Contract Adjustment
Payments (subject to any applicable record date), performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.

         The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.

         A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Purchase Contract Agent.

                                      C-12

<PAGE>

                                  ABBREVIATIONS

         The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM:                   as tenants in common

UNIF GIFT MIN ACT:         ______________________ Custodian ____________________
                                  (cust)                          (minor)

                           Under Uniform Gifts to Minors Act of ________________
                           _____________________________________________________

TENANT:                    as tenants by the entireties

JT TEN:                    as joint tenants with right of survivorship and not
                           as tenants in common

Additional abbreviations may also be used though not in the above list.

                      __________________________________

 FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
                                      unto

________________________________________________________________________________
 (Please insert Social Security or Taxpayer I.D. or other Identifying Number of
                                   Assignee)

________________________________________________________________________________
  (Please Print or Type Name and Address Including Postal Zip Code of Assignee)

the within Treasury Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ____________ attorney to transfer said
Treasury Units Certificates on the books of The Chubb Corporation, with full
power of substitution in the premises.

Dated:  __________________________           ___________________________________
                                             Signature

                                             NOTICE: The signature to this
                                             assignment must correspond with the
                                             name as it appears upon the face of
                                             the within Treasury Units
                                             Certificates in every particular,
                                             without alteration or enlargement
                                             or any change whatsoever.

         Signature Guarantee: ______________________________________

                                      C-13

<PAGE>

                             SETTLEMENT INSTRUCTIONS

         The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts represented by the number of Treasury Units
evidenced by this Treasury Units Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.

Dated: _______________________________   _______________________________________
                                         Signature
                                         Signature Guarantee: __________________
                                         (if assigned to another person)
If shares are to be registered in the
name of and delivered to a Person other  REGISTERED HOLDER
than the Holder, please (i) print such
Person's name and address and (ii)       Please print name and address of
provide a guarantee of your signature:   Registered Holder:

______________________________________   _______________________________________
Name                                     Name

______________________________________   _______________________________________
Address                                  Address
______________________________________   _______________________________________
______________________________________   _______________________________________
______________________________________   _______________________________________

______________________________________

Social Security or other
Taxpayer Identification
Number, if any                           _______________________________________

                                      C-14

<PAGE>

              ELECTION TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT

         The undersigned Holder of this Treasury Units Certificate hereby
irrevocably exercises the option to effect [Early Settlement] [Cash Merger Early
Settlement upon a Cash Merger] in accordance with the terms of the Purchase
Contract Agreement with respect to the Purchase Contracts represented by the
number of Treasury Units evidenced by this Treasury Units Certificate specified
below. The option to effect [Early Settlement] [Cash Merger Early Settlement]
may be exercised only with respect to Purchase Contracts represented by Treasury
Units with an aggregate Stated Amount equal to $1,000 or an integral multiple
thereof. The undersigned Holder directs that a certificate for shares of Common
Stock or other securities deliverable upon such [Early Settlement] [Cash Merger
Early Settlement] be registered in the name of, and delivered, together with a
check in payment for any fractional share and any Treasury Units Certificate
representing any Treasury Units evidenced hereby as to which Cash Merger Early
Settlement of the related Purchase Contracts is not effected, to the undersigned
at the address indicated below unless a different name and address have been
indicated below. Pledged Treasury Securities deliverable upon such [Early
Settlement] [Cash Merger Early Settlement] will be transferred in accordance
with the transfer instructions set forth below. If shares are to be registered
in the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.

Dated: ____________________________          ___________________________________
                                             Signature

                                             Signature Guarantee: ______________

                                      C-15

<PAGE>

         Number of Units evidenced hereby as to which [Early Settlement] [Cash
Merger Early Settlement] of the related Purchase Contracts is being elected:

If shares of Common Stock or Treasury     REGISTERED HOLDER
Units Certificates are to be registered
in the name of and delivered to and
Pledged Treasury Securities are to be
transferred to a Person other than the
Holder, please print such Person's name
and address:

                                          Please print name and address of
                                          Registered Holder:

________________________________________  ______________________________________
Name                                      Name

________________________________________  ______________________________________
Address                                   Address
________________________________________  ______________________________________
________________________________________  ______________________________________
________________________________________  ______________________________________

Social Security or other
Taxpayer Identification

Number, if any                            ______________________________________

                                      C-16

<PAGE>

Transfer Instructions for Pledged Treasury Securities Transferable upon [Early
Settlement] [Cash Merger Early Settlement] or a Termination Event:

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

                                      C-17

<PAGE>

                     [TO BE ATTACHED TO GLOBAL CERTIFICATES]

            SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE

The following increases or decreases in this Global Certificate have been made:

<TABLE>
<CAPTION>
                                                                          Number of Treasury
                         Amount of increase in   Amount of decrease in  Units evidenced by this
                          Number of Treasury      Number of Treasury      Global Certificate     Signature of authorized
                        Units evidenced by the  Units evidenced by the      following such        signatory of Purchase
Date                      Global Certificate      Global Certificate     decrease or increase         Contract Agent
----------------------  ----------------------  ----------------------  -----------------------  -----------------------
<S>                     <C>                     <C>                     <C>                      <C>
----------------------  ----------------------  ----------------------  -----------------------  -----------------------

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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</TABLE>

                                      C-18

<PAGE>

                                                                       EXHIBIT D

                     INSTRUCTION TO PURCHASE CONTRACT AGENT

Bank One Trust Company, N.A.
The Purchase Contract Agent
153 West 51st Street
New York, New York 10019
Fax: (212) 373-1383
Attention: Corporate Trust Administration

         Re: [_______ Corporate Units] [_______ Treasury Units (containing
Treasury Securities maturing on [July][August] 15, 2006) of The Chubb
Corporation, a New Jersey corporation (the "COMPANY").

         The undersigned Holder hereby notifies you that it has delivered to BNY
Midwest Trust Company, as Securities Intermediary, for credit to the Collateral
Account, $______ aggregate principal amount of [Senior Notes] [Treasury
Securities] in exchange for the [Pledged Senior Notes] [Pledged Treasury
Securities] held in the Collateral Account, in accordance with the Pledge
Agreement, dated as of June 24, 2003 (the "PLEDGE AGREEMENT"; unless otherwise
defined herein, terms defined in the Pledge Agreement are used herein as defined
therein), between you, the Company, the Collateral Agent, the Custodial Agent
and the Securities Intermediary. The undersigned Holder has paid all applicable
fees and expenses relating to such exchange. The undersigned Holder hereby
instructs you to instruct the Collateral Agent to release to you on behalf of
the undersigned Holder the [Pledged Senior Notes] [Pledged Treasury Securities]
related to such [Corporate Units] [Treasury Units (containing Treasury
Securities maturing on [July][August] 15, 2006) ].

Date: ________________________________       ___________________________________
                                             Signature

                                             Signature Guarantee: ______________

                                       D-1

<PAGE>

Please print name and address of Registered Holder:

____________________________________         ___________________________________
Name                                         Social Security or other Taxpayer
                                             Identification Number, if any

Address

_____________________________
_____________________________
_____________________________

_____________________________

                                       D-2

<PAGE>

                                                                       EXHIBIT E

                       NOTICE FROM PURCHASE CONTRACT AGENT
                                   TO HOLDERS
         (Transfer of Collateral upon Occurrence of a Termination Event)

[HOLDER]

_____________________________

_____________________________

Attention:
Telecopy: __________

                  Re:      [__________ Corporate Units] [______ Treasury Units
                           (containing Treasury Securities maturing on
                           [July][August] 15, 2006)] of The Chubb Corporation, a
                           New Jersey corporation (the "COMPANY")

         Please refer to the Purchase Contract Agreement, dated as of June 24,
2003 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the holders of Corporate Units and [Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) and]
Treasury Units from time to time.

         We hereby notify you that a Termination Event has occurred and that
[the Senior Notes] [Applicable Ownership Interests (as specified in clause (i)
of the definition of such term) in the Treasury Portfolio] [the Treasury
Securities] compromising a portion of your ownership interest in _____
[Corporate Units] [Treasury Units] have been released and are being held by us
for your account pending receipt of transfer instructions with respect to such
[Senior Notes][Treasury Securities] (the "RELEASED SECURITIES").

         Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [Corporate
Units][Treasury Units] effected through book-entry or by delivery to us of your
[Corporate Units Certificate][Treasury Units Certificate], we shall transfer the
Released Securities by book-entry transfer or other appropriate procedures, in
accordance with your instructions. In the event you fail to effect such transfer
or delivery, the Released Securities and any distributions thereon, shall be
held in our name, or a nominee in trust for your benefit, until such time as
such [Corporate Units][Treasury Units] are transferred or your [Corporate Units
Certificate] [Treasury Units Certificate] is surrendered or satisfactory
evidence

                                       E-1

<PAGE>

is provided that such [Corporate Units Certificate][Treasury Units Certificate]
has been destroyed, lost or stolen, together with any indemnification that we or
the Company may require.

Date:                                   By: BANK ONE TRUST COMPANY, N.A.,
                                            as the Purchase Contract Agent

                                        ________________________________________
                                        Name:
                                        Title: Authorized Signatory

                                       E-2

<PAGE>

                                                                       EXHIBIT F

                            NOTICE TO SETTLE BY CASH

Bank One Trust Company, N.A.
The Purchase Contract Agent
153 West 51st Street
New York, New York 10019
Fax: (212) 373-1383
Attention: Corporate Trust Administration

                  Re:      [_______ Corporate Units] [Treasury Units (containing
                           Treasury Securities maturing [July][August] 15,
                           2006)] of The Chubb Corporation, a New Jersey
                           corporation (the "COMPANY")

         The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.02 of the Purchase Contract Agreement, dated as of June 24, 2003
(the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and you, as Purchase Contract Agent and as Attorney-in-Fact
for the Holders of the Purchase Contracts, that such Holder has elected to pay
to the Securities Intermediary for deposit in the Collateral Account, prior to
or on 11:00 a.m. (New York City time) on the fourth Business Day immediately
preceding the Purchase Contract Settlement Date (in lawful money of the United
States by certified or cashiers' check or wire transfer, in immediately
available funds), $______ as the Stated Amount for the shares of Common Stock
issuable to such Holder by the Company with respect to _____ Purchase Contracts
on the Purchase Contract Settlement Date. The undersigned Holder hereby
instructs you to notify promptly the Collateral Agent of the undersigned
Holders' election to make such Cash Settlement with respect to the Purchase
Contracts related to such Holder's [Corporate Units] [Treasury Units (containing
Treasury Securities maturing [July][August] 15, 2006)].

Date: ______________________________         ___________________________________
                                             Signature

                                             Signature Guarantee: ______________

Please print name and address of Registered Holder:

                                       F-1

<PAGE>

                                                                       EXHIBIT G

                       NOTICE FROM PURCHASE CONTRACT AGENT
                               TO COLLATERAL AGENT
              (Settlement of Purchase Contract through Remarketing)

BNY Midwest Trust Company
The Collateral Agent
2 North LaSalle Street, Suite 1020
Chicago, Illinois 60602
Attention: Corporate Finance
Fax: (312) 827-8542

                  Re:      __________ Corporate Units of The Chubb Corporation,
                           a New Jersey corporation (the "COMPANY")

         Please refer to the Purchase Contract Agreement, dated as of June 24,
2003 (the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the Holders of Corporate Units from time to time.

         In accordance with Section 5.02 of the Purchase Contract Agreement and,
based on notices of [Early Settlements][Cash Settlements] received from Holders
of Corporate Units as of 5:00 p.m. (New York City time), on the fifth Business
Day immediately preceding the ______ Remarketing Date, we hereby notify you that
an aggregate principal amount of $______ Senior Notes are to be tendered for
purchase in the Remarketing.

Date:                                        By: BANK ONE TRUST COMPANY, N.A.,
                                                 as the Purchase Contract Agent

                                             ___________________________________
                                             Name:
                                             Title: Authorized Signatory

                                       G-1

<PAGE>

                                                                       EXHIBIT H

                         [FORM OF REMARKETING AGREEMENT]

Citigroup Global Markets Inc.
388 Greenwich Street,
New York, NY 10013

Goldman, Sachs & Co.
85 Broad Street
New York, NY 10004

Merrill Lynch, Pierce, Fenner & Smith Incorporated
4 World Financial Center, North Tower
New York, NY 10080

Bank One Trust Company, N.A.
153 West 51st Street
New York, NY 10019

Ladies and Gentlemen:

         This Agreement is dated [Insert Date] (the "AGREEMENT") by and among
The Chubb Corporation, a New Jersey corporation (the "COMPANY"), Citigroup
Global Markets Inc. ("CITIGROUP"), Goldman, Sachs & Co. ("GOLDMAN SACHS"),
Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MERRILL LYNCH") and Bank
One Trust Company, N.A., a national banking association, not individually but
solely as Purchase Contract Agent (the "PURCHASE CONTRACT AGENT") and as
attorney-in-fact of the holders of Purchase Contracts (as defined in the
Purchase Contract Agreement referred to below).

SECTION 13.01. Definitions.

         (a) Capitalized terms used and not defined in this Agreement shall have
the meanings set forth in the Purchase Contract Agreement, dated as of June 24,
2003, between the Company and Bank One Trust Company, N.A., as Purchase Contract
Agent, as amended from time to time (the "PURCHASE CONTRACT AGREEMENT").

         (b) As used in this Agreement, the following terms have the following
meanings:

         "PRELIMINARY PROSPECTUS" means any preliminary prospectus relating to
the Remarketed Senior Notes included in the Registration Statement, including
the documents incorporated by

                                       H-1

<PAGE>

reference therein as of the date of such Preliminary Prospectus; and any
reference to any amendment or supplement to such Preliminary Prospectus shall be
deemed to refer to and include any documents filed after the date of such
Preliminary Prospectus, under the Exchange Act, and incorporated by reference in
such Preliminary Prospectus.

         "PROSPECTUS" means the prospectus relating to the Remarketed Senior
Notes, in the form in which first filed, or transmitted for filing, with the
Commission after the effective date of the Registration Statement pursuant to
Rule 424(b), including the documents incorporated by reference therein as of the
date of such Prospectus; and any reference to any amendment or supplement to
such Prospectus shall be deemed to refer to and include any documents filed
after the date of such Prospectus, under the Exchange Act, and incorporated by
reference in such Prospectus.

         "REGISTRATION STATEMENT" means a registration statement under the
Securities Act of 1933, as amended (the "SECURITIES ACT") prepared by the
Company covering, inter alia, the Remarketing of the Remarketed Senior Notes
pursuant to Section 5(a) hereunder, including all exhibits thereto and the
documents incorporated by reference in the prospectus contained in such
registration statement, and any post-effective amendments thereto. "Remarketed
Senior Notes" means the Pledged Senior Notes and the Separate Senior Notes, if
any, subject to Remarketing as identified to the Remarketing Agent by the
Purchase Contract Agent and the Custodial Agent, respectively, after 11:00 a.m.,
New York City time, on the Business Day immediately preceding the applicable
Remarketing Date, and shall include: (a) (i) in the case of the Initial
Remarketing, the Second Remarketing and the Third Remarketing, the Pledged
Senior Notes and (ii) in the case of the Final Remarketing, the Senior Notes of
the Holders of Corporate Units who have not notified the Purchase Contract Agent
prior to 5:00 p.m. on the fifth Business Day immediately preceding the Purchase
Contract Settlement Date of their intention to effect a Cash Settlement of the
related Purchase Contracts pursuant to the terms of the Purchase Contract
Agreement or who have so notified the Purchase Contract Agent but failed to make
the required cash payment on the fourth Business Day immediately preceding the
Purchase Contract Settlement Date pursuant to the terms of the Purchase Contract
Agreement, and (b) the Separate Senior Notes of the holders of Separate Senior
Notes, if any, who have elected to have their Separate Senior Notes be
remarketed in such Remarketing pursuant to the terms of the Purchase Contract
Agreement.

         "REMARKETING" means the remarketing of the Remarketed Senior Notes
pursuant to this Remarketing Agreement.

         "REMARKETING AGENT" means any of Citigroup, Goldman Sachs or Merrill
Lynch appointed as the Remarketing Agent by the Company pursuant to Section 2(a)
hereof.

         "REMARKETING MATERIALS" means the Preliminary Prospectus, the
Prospectus or any other information furnished by the Company to the Remarketing
Agent for distribution to investors in connection with the Remarketing.

                                       H-2

<PAGE>

         "SENIOR NOTES" means the senior notes due August 16, 2008 of the
Company.

         "TRANSACTION DOCUMENTS" means this Agreement, the Purchase Contract
Agreement, the Pledge Agreement and the Indenture, in each case as amended or
supplemented from time to time.

         SECTION 0.02. Appointment and Obligations of the Remarketing Agent.

         (a) On or before the twentieth Business Day prior to the Initial
Remarketing Date (the "APPOINTMENT DATE"), the Company shall send written notice
appointing any of Citigroup, Goldman Sachs or Merrill Lynch as the exclusive
Remarketing Agent, subject to the terms and conditions set forth herein, for the
purpose of (i) Remarketing the Remarketed Senior Notes on behalf of the holders
thereof, (ii) determining, in consultation with the Company, in the manner
provided for herein and in the Purchase Contract Agreement and the Indenture,
the Reset Rate for the Senior Notes, and (iii) performing such other duties as
are assigned to the Remarketing Agent in the Transaction Documents. Each of
Citigroup, Goldman Sachs and Merrill Lynch hereby agree that if the Company
chooses to appoint it as the Remarketing Agent, it shall, subject to the terms
and conditions set forth herein, accept such appointment by the Company as the
exclusive Remarketing Agent.

         (b) Unless a Special Event Redemption has occurred prior to such date,
on the third Business Day immediately preceding May 16, 2006 (the "INITIAL
REMARKETING DATE"), the Remarketing Agent shall use its reasonable efforts to
remarket ("INITIAL REMARKETING") the Remarketed Senior Notes, at a price (the
"REMARKETING PRICE"), based on the Reset Rate, equal to approximately (but not
less than) 100.50% of the sum of the Treasury Portfolio Purchase Price and the
Separate Senior Notes Purchase Price.

         (c) In the case of a Failed Initial Remarketing and unless a Special
Event Redemption has occurred prior to such date, on the third Business Day
immediately preceding June 16, 2006 (the "SECOND REMARKETING DATE"), the
Remarketing Agent shall use its reasonable efforts to remarket (the "SECOND
REMARKETING") the Remarketed Senior Notes at the Remarketing Price. In the case
of a Failed Second Remarketing and unless a Special Event Redemption has
occurred prior to such date, on the third Business Day immediately preceding
July 16, 2006 (the "THIRD REMARKETING DATE"), the Remarketing Agent shall use
its reasonable efforts to remarket (the "THIRD REMARKETING") the Remarketed
Senior Notes at the Remarketing Price. In the case of a Failed Third Remarketing
and unless a Special Event Redemption has occurred prior to such date, on the
third Business Day immediately preceding the Purchase Contract Settlement Date
(the "FINAL REMARKETING DATE"), the Remarketing Agent shall use its reasonable
efforts to remarket (the "FINAL REMARKETING") the Remarketed Senior Notes at a
price (the "FINAL REMARKETING PRICE"), based on the Reset Rate, equal to
approximately 100.50% (or, if the Remarketing Agent is unable to remarket the
Remarketed Senior Notes at such rate, at a rate

                                       H-3

<PAGE>

below 100.50%, but in no event less than 100%, net of the Remarketing Fee) of
the aggregate principal amount of the Remarketed Senior Notes being remarketed
in such Final Remarketing. It is understood and agreed that the Remarketing on
any Remarketing Date, other than the Final Remarketing Date, will be considered
successful and no further attempts will be made if the resulting proceeds are at
least 100.25% (net of the Remarketing Fee) of the sum of the Treasury Portfolio
Purchase Price and the Separate Senior Notes Purchase Price. It is further
understood and agreed that the Final Remarketing will be considered successful
if the resulting proceeds are at least 100% (net of the Remarketing Fee) of the
aggregate principal amount of the Remarketed Senior Notes.

         (d) In connection with each Remarketing, the Remarketing Agent shall
determine, in consultation with the Company, the rate per annum, rounded to the
nearest one-thousandth (0.001) of one percent per annum, that the Senior Notes
should bear (the "RESET RATE") in order for the Senior Notes of the Corporate
Unit holders to have an aggregate market value equal to the Remarketing Price or
the Final Remarketing Price, as the case may be, and that in the sole reasonable
discretion of the Remarketing Agent will enable it to remarket all of the
Remarketed Senior Notes at the Remarketing Price or Final Remarketing Price, as
the case may be, in such Remarketing, provided that such rate shall not exceed
the maximum interest rate permitted by law.

         (e) In the event of a Failed Remarketing or if no Senior Notes are
included in Corporate Units, and if none of the holders of the Separate Senior
Notes elect to have Senior Notes be remarketed in such Remarketing, the
applicable interest rate on the Senior Notes will not be reset and will continue
to be the Coupon Rate set forth in the Indenture, as supplemented from time to
time.

         (f) If, by 4:00 p.m. (New York City time) on the applicable Remarketing
Date, the Remarketing Agent is unable to remarket all of the Remarketed Senior
Notes at the Remarketing Price or the Final Remarketing Price, as the case may
be, pursuant to the terms and conditions hereof, a Failed Remarketing shall be
deemed to have occurred, and the Remarketing Agent shall advise, by telephone
the Depositary, the Purchase Contract Agent and the Company, and return the
Remarketed Senior Notes to the Collateral Agent or the Custodial Agent, as the
case may be. Whether or not there has been a Failed Remarketing will be
determined in the sole reasonable discretion of the Remarketing Agent.

         (g) In the event of a Successful Remarketing, by approximately 4:30
p.m. (New York City time) on the applicable Remarketing Date, the Remarketing
Agent shall advise, by telephone:

                  (1)      the Depositary, the Purchase Contract Agent and the
Company of the Reset Rate determined by the Remarketing Agent in such
Remarketing and the number of Remarketed Senior Notes sold in such Remarketing;

                                       H-4

<PAGE>

                  (2)      each purchaser (or the Depositary Participant
thereof) of Remarketed Senior Notes of the Reset Rate and the number of
Remarketed Senior Notes such purchaser is to purchase; and

                  (3)      each such purchaser to give instructions to its
Depositary Participant to pay the purchase price on the third business day
immediately following the date of such Successful Remarketing in same day funds
against delivery of the Remarketed Senior Notes purchased through the facilities
of the Depositary.

         The Remarketing Agent shall also, if required by the Securities Act or
the rules and regulations promulgated thereunder, deliver to each purchaser a
Prospectus in connection with the Remarketing.

         (h) After deducting any fees specified in Section 4 below, the proceeds
from a Successful Remarketing (i) with respect to the Senior Notes that are
components of the Corporate Units, shall be paid to the Collateral Agent in
accordance with Sections 5.07 and 7.03 of the Pledge Agreement, as the case may
be, and Section 5.02 of the Purchase Contract Agreement and (ii) with respect to
the Separate Senior Notes, shall be paid to the Custodial Agent for payment to
the holders of such Separate Senior Notes in accordance with Section 5.02 of the
Purchase Contract Agreement and Section 7.03 of the Pledge Agreement.

         (i) The right of each holder of Separate Senior Notes or Corporate
Units to have Remarketed Senior Notes remarketed and sold on any Remarketing
Date shall be subject to the conditions that (i) the Remarketing Agent conducts
an (A) Initial Remarketing, (B) a Second Remarketing in the event of a Failed
Initial Remarketing, (C) a Third Remarketing in the event of a Failed Second
Remarketing and (D) a Final Remarketing in the event of a Failed Third
Remarketing, each pursuant to the terms of this Agreement, (ii) a Special Event
Redemption has not occurred prior to such Remarketing Date, (iii) the
Remarketing Agent is able to find a purchaser or purchasers for Remarketed
Senior Notes at the Remarketing Price or the Final Remarketing Price, as the
case may be, based on the Reset Rate, and (iv) such purchaser or purchasers
deliver the purchase price therefor to the Remarketing Agent as and when
required.

         (j) It is understood and agreed that the Remarketing Agent shall not
have any obligation whatsoever to purchase any Remarketed Senior Notes, whether
in the Remarketing or otherwise, and shall in no way be obligated to provide
funds to make payment upon tender of Remarketed Senior Notes for Remarketing or
to otherwise expend or risk its own funds or incur or to be exposed to financial
liability in the performance of its duties under this Agreement, and without
limitation of the foregoing, the Remarketing Agent shall not be deemed an
underwriter of the Remarketed Senior Notes. Neither the Company nor the
Remarketing Agent shall be obligated in any case to provide funds to make
payment upon tender of the Remarketed Senior Notes for Remarketing.

         SECTION 0.03. Representations and Warranties of the Company.

                                       H-5

<PAGE>

         The Company represents and warrants (i) on and as of the date any
Remarketing Materials are first distributed in connection with the Remarketing
(the "COMMENCEMENT DATE"), (ii) on and as of the applicable Remarketing Date and
(iii) on and as of the settlement date relating to such Remarketing Date, that:

         (a) Each of the representations and warranties of the Company as set
forth in Sections 1(a) through 1(aa) of the Underwriting Agreement dated June
18, 2003 (the "UNDERWRITING AGREEMENT") among the Company and the Underwriters
identified in Schedule II thereto, is true and correct as if made on each of the
dates specified above; provided that for purposes of this Section 3(a), any
reference in such sections of the Underwriting Agreement to (i) the
"Registration Statement", the "Prospectus" or the "Preliminary Prospectus" shall
be deemed to refer to such terms as defined herein and (ii) the "Closing Date"
shall be deemed to refer to the applicable Remarketing Date.

         (b) The Registration Statement, if any, in the form heretofore
delivered or to be delivered to the Remarketing Agent, has been declared
effective by the Commission in such form; and no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceeding
for that purpose has been initiated or threatened by the Commission.

         (c) The documents incorporated by reference in the Prospectus, when
they were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; and any further documents so filed and
incorporated by reference in the Prospectus or any further amendment or
supplement thereto, when such documents are filed with the Commission, will
conform in all material respects to the requirements of the Exchange Act and the
rules and regulations of the Commission thereunder, and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information relating to
the Remarketing Agent furnished in writing to the Company by the Remarketing
Agent or its counsel expressly for use in the Prospectus.

         (d) The Registration Statement, if any, conforms (and the Prospectus,
if any, and any further amendments or supplements to the Registration Statement
or the Prospectus, when they become effective or are filed with the Commission,
as the case may be, will conform) in all material respects to the requirements
of the Securities Act and the rules and regulations promulgated thereunder, and
the Registration Statement and the Remarketing Materials (and any amendment or
supplement thereto) as of their respective effective or filing dates and as of
the Commencement Date, applicable Remarketing Date and Purchase Contract
Settlement Date do

                                       H-6

<PAGE>

not and will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; provided that no representation and warranty
is made as to any statement of eligibility on Form T-1 filed or incorporated by
reference as part of the Registration Statement, the Prospectus or the
Remarketing Materials, or as to information relating to the Remarketing Agent
contained in or omitted from the Registration Statement, the Prospectus or the
Remarketing Materials in reliance upon and in conformity with written
information furnished to the Company by the Remarketing Agent.

         (e) This Agreement has been duly authorized, executed and delivered by
the Company.

         SECTION 0.04. Fees.

         (a) In the event of a Successful Remarketing of the Remarketed Senior
Notes prior to the Final Remarketing Date, the Remarketing Agent may retain as a
remarketing fee (the "REMARKETING FEE") an amount not exceeding 25 basis points
(0.25%) of the sum of the Treasury Portfolio Purchase Price and the Separate
Senior Note Purchase Price.

         (b) In the event of a Successful Final Remarketing, the Remarketing
Agent may retain as the Remarketing Fee an amount not exceeding 25 basis points
(0.25%) of the principal amount of the Remarketed Senior Notes.

         SECTION 0.05. Covenants of the Company.

         The Company covenants and agrees as follows:

         (a) If and to the extent the Remarketed Senior Notes are required (in
the view of counsel, which need not be in the form of a written opinion, for
either the Remarketing Agent or the Company) to be registered under the
Securities Act as in effect at the time of the Remarketing,

                  (1)      to prepare the Registration Statement and the
             Prospectus, in a form approved by the Remarketing Agent, to file
             any such Prospectus pursuant to the Securities Act within the
             period required by the Securities Act and the rules and regulations
             thereunder and to use commercially reasonable efforts to cause the
             Registration Statement to be declared effective by the Commission
             prior to the second Business Day immediately preceding the
             applicable Remarketing Date;

                  (2)      to file promptly with the Commission any amendment to
             the Registration Statement or the Prospectus or any supplement to
             the Prospectus that may, in the reasonable judgment of the Company
             or the Remarketing Agent, be required by the Securities Act or
             requested by the Commission;

                                       H-7

<PAGE>

                  (3)      to advise the Remarketing Agent, promptly after it
             receives notice thereof, of the time when any amendment to the
             Registration Statement has been filed or becomes effective or any
             supplement to the Prospectus or any amended Prospectus has been
             filed and to furnish the Remarketing Agent with copies thereof;

                  (4)      to file promptly all reports and any definitive proxy
             or information statements required to be filed by the Company with
             the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
             Exchange Act subsequent to the date of the Prospectus and for so
             long as the delivery of a Prospectus is required in connection with
             the offering or sale of the Remarketed Senior Notes;

                  (5)      to advise the Remarketing Agent, promptly after it
             receives notice thereof, of the issuance by the Commission of any
             stop order or of any order preventing or suspending the use of the
             Prospectus, of the suspension of the qualification of any of the
             Remarketed Senior Notes for offering or sale in any jurisdiction,
             of the initiation or threatening of any proceeding for any such
             purpose, or of any request by the Commission for the amending or
             supplementing of the Registration Statement or the Prospectus or
             for additional information, and, in the event of the issuance of
             any stop order or of any order preventing or suspending the use of
             any Prospectus or suspending any such qualification, to use
             promptly its best efforts to obtain its withdrawal;

                  (6)      to furnish promptly to the Remarketing Agent such
             copies of the following documents as the Remarketing Agent shall
             reasonably request: (A) conformed copies of the Registration
             Statement as originally filed with the Commission and each
             amendment thereto (in each case excluding exhibits); (B) the
             Preliminary Prospectus and any amended or supplemented Preliminary
             Prospectus, (C) the Prospectus and any amended or supplemented
             Prospectus; and (D) any document incorporated by reference in the
             Prospectus (excluding exhibits thereto); and, if at any time when
             delivery of a prospectus is required in connection with the
             Remarketing, any event shall have occurred as a result of which the
             Prospectus as then amended or supplemented would include any untrue
             statement of a material fact or omit to state any material fact
             necessary in order to make the statements therein, in the light of
             the circumstances under which they were made when such Prospectus
             is delivered, not misleading, or if for any other reason it shall
             be

                                       H-8

<PAGE>

             necessary during such same period to amend or supplement the
             Prospectus or to file under the Exchange Act any document
             incorporated by reference in the Prospectus in order to comply with
             the Securities Act or the Exchange Act, to notify the Remarketing
             Agent and, upon its request, to file such document and to prepare
             and furnish without charge to the Remarketing Agent and to any
             dealer in securities as many copies as the Remarketing Agent may
             from time to time reasonably request of an amended or supplemented
             Prospectus that will correct such statement or omission or effect
             such compliance;

                  (7)      prior to filing with the Commission (A) any amendment
             to the Registration Statement or supplement to the Prospectus or
             (B) any Prospectus pursuant to Rule 424 under the Securities Act,
             to furnish a copy thereof to the Remarketing Agent and counsel to
             the Remarketing Agent; and not to file any such amendment or
             supplement that shall be reasonably disapproved by the Remarketing
             Agent promptly after reasonable notice;

                  (8)      as soon as practicable, but in any event not later
             than eighteen months, after the effective date of the Registration
             Statement, to make "generally available to its security holders" an
             "earnings statement" of the Company and its subsidiaries complying
             with (which need not be audited) Section 11(a) of the Securities
             Act and the rules and regulations thereunder (including, at the
             option of the Company, Rule 158 under the Securities Act). The
             terms "GENERALLY AVAILABLE TO ITS SECURITY HOLDERS" and "EARNINGS
             STATEMENT" shall have the meanings set forth in Rule 158 under the
             Securities Act; and

                  (9)      to take such action as the Remarketing Agent may
             reasonably request in order to qualify the Remarketed Senior Notes
             for offer and sale under the securities or "blue sky" laws of such
             jurisdictions as the Remarketing Agent may reasonably request;
             provided that in no event shall the Company be required to qualify
             as a foreign corporation or to file a general consent to service of
             process in any jurisdiction.

         (b) To pay: (1) the costs incident to the preparation and printing of
the Registration Statement, if any, any Prospectus and any other Remarketing
Materials and any amendments or supplements thereto; (2) the costs of
distributing the Registration Statement, if any, any Prospectus and any other
Remarketing Materials and any amendments or supplements thereto; (3) any fees
and expenses of qualifying the Remarketed Senior Notes under the securities laws
of

                                       H-9

<PAGE>

the several jurisdictions as provided in Section 5(a)(9) and of preparing,
printing and distributing a Blue Sky Memorandum, if any (including any related
fees and expenses of counsel to the Remarketing Agent); (4) all other costs and
expenses incident to the performance of the obligations of the Company hereunder
and the Remarketing Agent hereunder; and (5) the reasonable fees and expenses of
counsel to the Remarketing Agent in connection with their duties hereunder.

         (c) To furnish the Remarketing Agent with such information and
documents as the Remarketing Agent may reasonably request in connection with the
transactions contemplated hereby, and to make reasonably available to the
Remarketing Agent and any accountant, attorney or other advisor retained by the
Remarketing Agent such information that parties would customarily require in
connection with a due diligence investigation conducted in accordance with
applicable securities laws and to cause the Company's officers, directors,
employees and accountants to participate in all such discussions and to supply
all such information reasonably requested by any such Person in connection with
such investigation.

         SECTION 0.06. Conditions to the Remarketing Agent's Obligations.

         The obligations of the Remarketing Agent hereunder shall be subject to
the following conditions:

         (a) The Prospectus, if any, shall have been timely filed with the
Commission; no stop order suspending the effectiveness of the Registration
Statement, if any, or any part thereof shall have been issued and no proceeding
for that purpose shall have been initiated or threatened by the Commission; and
any request of the Commission for inclusion of additional information in the
Registration Statement or the Prospectus or otherwise shall have been complied
with.

         (b) (1) Trading generally shall not have been suspended or materially
limited on the New York Stock Exchange, (2) trading of any securities of the
Company shall not have been materially suspended or limited on the New York
Stock Exchange, (3) a general moratorium on commercial banking activities in New
York shall not have been declared by either Federal or New York State
authorities, or (4) there shall not have occurred a material adverse change in
the financial markets, any outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national emergency or
war or other calamity or crisis, if the effect of any such event specified in
this clause (4) in the judgment of the Remarketing Agent makes it impracticable
or inadvisable to proceed with the Remarketing or the delivery of the Remarketed
Senior Notes on the terms and in the manner contemplated in the Transaction
Documents.

         (c) The representations and warranties of the Company contained herein
shall be true and correct in all material respects on and as of the applicable
Remarketing Date, and the Company, the Purchase Contract Agent and the
Collateral Agent shall have performed in all material respects all covenants and
agreements contained herein or in the Purchase Contract

                                      H-10

<PAGE>

Agreement or Pledge Agreement to be performed on their part at or prior to such
Remarketing Date.

         (d) The Company shall have furnished to the Remarketing Agent a
certificate, dated the applicable Remarketing Date, of the Chief Executive
Officer and the Treasurer satisfactory to the Remarketing Agent stating that:
(1) no order suspending the effectiveness of the Registration Statement, if any,
or prohibiting the sale of the Remarketed Senior Notes is in effect, and no
proceedings for such purpose are pending before or, to the knowledge of such
officers, threatened by the Commission; (2) the representations and warranties
of the Company in Section 3 are true and correct on and as of the applicable
Remarketing Date and the Company has performed in all material respects all
covenants and agreements contained herein to be performed on its part at or
prior to such Remarketing Date; and (3) the Registration Statement, as of its
effective date, and the Remarketing Materials, as of their respective dates, did
not contain any untrue statement of a material fact and did not omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading and the Prospectus did not contain any untrue
statement of material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.

         (e) On the applicable Remarketing Date, the Remarketing Agent shall
have received a letter addressed to the Remarketing Agent and dated such date,
in form and substance satisfactory to the Remarketing Agent, of Ernst & Young
LLP, the independent accountants of the Company, containing statements and
information of the type ordinarily included in accountants' "comfort letters"
with respect to certain financial information contained in the Remarketing
Materials, if any.

         (f) Each of (1) the General Counsel to the Company, (2) Debevoise &
Plimpton, counsel to the Company and (3) Drinker, Biddle & Reath LLP, New Jersey
counsel to the Company, shall have furnished to the Remarketing Agent its
opinion, addressed to the Remarketing Agent and dated the Remarketing Date, in
form and substance reasonably satisfactory to the applicable Remarketing Agent
addressing such matters as are set forth in such counsel's opinion furnished
pursuant to Sections 6(b), 6(c) and 6(d) of the Underwriting Agreement, adapted
as necessary to relate to the securities being remarketed hereunder and to the
Remarketing Materials, if any, or to any changed circumstances or events
occurring subsequent to the date of this Agreement, such adaptations being
reasonably acceptable to counsel to the Remarketing Agent.

         (g) Davis Polk & Wardwell, counsel for the Remarketing Agent, shall
have furnished to the Remarketing Agent its opinion, addressed to the
Remarketing Agent and dated the applicable Remarketing Date, in form and
substance satisfactory to the Remarketing Agent.

                                      H-11

<PAGE>

         (h) Subsequent to the execution and delivery of this Agreement and
prior to the applicable Remarketing Date, there shall not have occurred any
downgrading, nor shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not indicate an
improvement, in the rating accorded any of the Company's securities by any
"nationally recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act.

         SECTION 0.07. Indemnification.

         (a) The Company will indemnify and hold harmless the Remarketing Agent,
its partners, directors and officers and each person, if any, who controls the
Remarketing Agent within the meaning of Section 15 of the Securities Act,
against any losses, claims, damages or liabilities, joint or several, to which
the Remarketing Agent may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, the
Prospectus, or any amendments or supplement thereto, or any related Preliminary
Prospectus or preliminary prospectus supplement, or any other Remarketing
Materials, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse the Remarketing Agent
for any legal or other expenses reasonably incurred by the Remarketing Agent in
connection with investigating or defending any such losses, claims, damages,
liabilities or action as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission from any of such
documents in reliance upon and in conformity with written information furnished
to the Company by the Remarketing Agent specifically for use therein.

         (b) The Remarketing Agent will indemnify and hold harmless the Company,
its directors and officers and each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act, against any losses,
claims, damages or liabilities to which the Company may become subject, under
the Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement, the Prospectus or any amendment or supplement thereto,
or any related Preliminary Prospectus or Preliminary Prospectus supplement, or
any other Remarketing Materials, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company by the
Remarketing Agent specifically for use therein, and will reimburse any legal or
other expenses reasonably incurred by the Company in connection

                                      H-12

<PAGE>

with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred.

         (c) Promptly after receipt by an indemnified party under this section
of notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under subsection (a) or (b) above. In the case of parties
indemnified pursuant to subsection (a) above, counsel to the indemnified parties
shall be selected by the Remarketing Agent. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 7 (whether or
not the indemnified parties are actual or potential parties thereto), unless
such settlement, compromise or consent (i) includes an unconditional release of
each indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a statement as to
or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.

         SECTION 0.08. Contribution.

         (a) If the indemnification provided for in Section 7 is unavailable to
or insufficient to hold harmless an indemnified party under Sections 7(a) or
7(b), then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Remarketing Agent on the other from the offering of the
Remarketed Senior Notes or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportions as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and the Remarketing Agent on the
other in connection with the statements of omissions which resulted in such
losses, claims, damages or liabilities as well as any relevant equitable
considerations. The relative benefits received by the Company on one hand and
the Remarketing Agent on the other hand in connection with the Remarketing shall
be deemed to be in the same proportions as the aggregate principal amount of the
Remarketed Senior Notes less the fee paid to the Remarketing Agent on the one
hand and the

                                      H-13

<PAGE>

fee paid to the Remarketing Agent on the other hand bear to the aggregate
principal amount of the Remarketed Senior Notes. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or the Remarketing Agent on the other hand and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this subsection (a) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
subsection (a). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (a) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (a), the Remarketing Agent shall not be required
to contribute any amount in excess of the amount by which the fees received by
it under Section 4 exceeds the amount of any damages which the Remarketing Agent
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.

         (b) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each officer and director of the
Remarketing Agent and to each person, if any, who controls the Remarketing Agent
within the meaning of the Securities Act; and the obligations of the Remarketing
Agent under this Section 8 shall be in addition to any liability which the
Remarketing Agent may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company, to each officer of the Company who
signed the Registration Statement and to each person, if any, who controls the
Company within the meaning of the Securities Act.

         (c) The indemnity and contribution provisions contained in Section 7
and this Section 8 and the representations, warranties and other statements of
the Company contained in this Agreement shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of the Remarketing Agent or any person controlling the
Remarketing Agent, or the Company, its officers or director or any controlling
person of the Company, and the completion of the Remarketing.

         SECTION 0.09. Resignation and Removal of the Remarketing Agent.

         Any of Citigroup, Goldman Sachs or Merrill Lynch (the "REMARKETING
AGENT CANDIDATES") may resign and be discharged from its duties and obligations
hereunder, and the

                                      H-14

<PAGE>

Company may remove any of the Remarketing Agent Candidates, by giving 30 days'
prior written notice, in the case of a resignation, to the Company and the
Depositary and, in the case of a removal, to the removed Remarketing Agent
Candidate and the Depositary; provided, however, that if only one Remarketing
Agent Candidate remains:

         (a) such Remarketing Agent Candidate may not resign without reasonable
cause; and

         (b) no such resignation nor any such removal shall become effective
until the Company shall have appointed at least one nationally recognized
broker-dealer as successor Remarketing Agent and such successor Remarketing
Agent shall have entered into a remarketing agreement with the Company, in which
it shall have agreed to conduct the Remarketing in accordance with the
Transaction Documents in all material respects.

         In any such case, the Company will use commercially reasonable efforts
to appoint a successor Remarketing Agent and enter into such a remarketing
agreement with such person as soon as reasonably practicable. The provisions of
Section 7 and Section 8 shall survive the resignation or removal of any
Remarketing Agent Candidate pursuant to this Agreement.

         SECTION 0.10. Dealing in Securities.

         The Remarketing Agent, when acting as a Remarketing Agent or in its
individual or any other capacity, may, to the extent permitted by law, buy,
sell, hold and deal in any of the Remarketed Senior Notes, Corporate Units,
Treasury Units or any of the securities of the Company (together, the
"SECURITIES"). The Remarketing Agent may exercise any vote or join in any action
which any beneficial owner of such Securities may be entitled to exercise or
take pursuant to the Indenture with like effect as if it did not act in any
capacity hereunder. The Remarketing Agent, in its individual capacity, either as
principal or agent, may also engage in or have an interest in any financial or
other transaction with the Company as freely as if it did not act in any
capacity hereunder.

         SECTION 0.11. Remarketing Agent's Performance; Duty of Care.

         The duties and obligations of the Remarketing Agent shall be determined
solely by the express provisions of this Agreement and the Transaction
Documents. No implied covenants or obligations of or against the Remarketing
Agent shall be read into this Agreement or any of the Transaction Documents. In
the absence of bad faith on the part of the Remarketing Agent, the Remarketing
Agent may conclusively rely upon any document furnished to it, as to the truth
of the statements expressed in any of such documents. The Remarketing Agent
shall be protected in acting upon any document or communication reasonably
believed by it to have been signed, presented or made by the proper party or
parties except as otherwise set forth herein. The Remarketing Agent, acting
under this Agreement, shall incur no liability to the Company or to any holder
of Remarketed Senior Notes in its individual capacity or as Remarketing Agent
for any action or failure to act, on its part in connection with a Remarketing
or otherwise, except if

                                      H-15

<PAGE>

such liability is judicially determined to have resulted from its failure to
comply with the material terms of this Agreement or the gross negligence or
willful misconduct on its part. The provisions of this Section 11 shall survive
the termination of this Agreement and shall survive the resignation or removal
of any Remarketing Agent pursuant to this Agreement.

         SECTION 0.12. Termination.

         This Agreement shall automatically terminate (i) as to the Remarketing
Agent on the effective date of the resignation or removal of the Remarketing
Agent pursuant to Section 9 and (ii) on the earlier of (x) any Special Event
Redemption Date and (y) the Purchase Contract Settlement Date. If this Agreement
is terminated pursuant to any of the other provisions hereof, except as
otherwise provided herein, the Company shall not be under any liability to the
Remarketing Agent and the Remarketing Agent shall not be under any liability to
the Company, except that if this Agreement is terminated by the Remarketing
Agent because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, the
Company will reimburse the Remarketing Agent for all of its out-of-pocket
expenses (including the fees and disbursements of its counsel) reasonably
incurred by it. Section 7, Section 8 and Section 11 hereof shall survive the
termination of this Agreement or the resignation or removal of the Remarketing
Agent.

         SECTION 0.13. Notices.

         All statements, requests, notices and agreements hereunder shall be in
writing, and:

         (a) if to the Remarketing Agent Candidates, shall be delivered or sent
by mail, telex or facsimile transmission to:

                           Citigroup Global Markets, Inc.
                           388 Greenwich Street,
                           New York, NY 10013
                           Telecopier No.: [       ]
                           Attention: General Counsel

                                      H-16

<PAGE>

                           Goldman Sachs & Co.
                           85 Broad Street
                           New York, NY 10004
                           Telecopier No.: [       ]
                           Attention: [            ]

                           Merrill Lynch, Pierce, Fenner & Smith Incorporated
                           4 World Financial Center, North Tower
                           New York, NY 10080
                           Telecopier No.: [       ]
                           Attention: [            ]

         (b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to The Chubb Corporation, 15 Mountain View Road, Warren,
New Jersey 07061-1615, Attention: General Counsel (Telecopier No.: (908)
903-2003); and

         (c) if to the Purchase Contract Agent, shall be delivered or sent by
mail, telex or facsimile transmission to Bank One Trust Company, N.A. , 153 West
51st Street, New York, New York, 10019, Attention: Corporate Trust
Administration.

         Any such statements, requests, notices or agreements shall take effect
at the time of receipt thereof.

         SECTION 0.14. Persons Entitles to Benefit of Agreement.

         This Agreement shall inure to the benefit of and be binding upon each
party hereto and its respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
(x) the representations, warranties, indemnities and agreements of the Company
contained in this Agreement shall also be deemed to be for the benefit of the
Remarketing Agent and the person or persons, if any, who control the Remarketing
Agent within the meaning of Section 15 of the Securities Act and (y) the
indemnity agreement of the Remarketing Agent contained in Section 7(b) of this
Agreement shall be deemed to be for the benefit of the Company's directors and
officers who sign the Registration Statement, if any, and any person controlling
the Company within the meaning of Section 15 of the Securities Act. Nothing
contained in this Agreement is intended or shall be construed to give any
person, other than the persons referred to herein, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision contained
herein.

         SECTION 0.15. Survival.

         The respective indemnities, representations, warranties and agreements
of the Company and the Remarketing Agent contained in this Agreement or made by
or on behalf of them, respectively, pursuant to this Agreement, shall survive
any Remarketing and shall remain in full

                                      H-17

<PAGE>

force and effect, regardless of any investigation made by or on behalf of any of
them or any person controlling any of them.

         SECTION 0.16. Governing Law.

         This Agreement shall be governed by, and construed in accordance with,
the laws of New York, without regard to conflicts of laws principles.

         SECTION 0.17. Judicial Proceedings.

         (a) Each party hereto expressly accepts and irrevocably submits to the
non-exclusive jurisdiction of the United States Federal or New York State court
sitting in the Borough of Manhattan, The City of New York, New York, over any
suit, action or proceeding arising out of or relating to this Agreement or the
Securities. To the fullest extent it may effectively do so under applicable law,
each party hereto irrevocably waives and agrees not to assert, by way of motion,
as a defense or otherwise, any claim that it is not subject to the jurisdiction
of any such court, any objection that it may now or hereafter have to the laying
of the venue of any such suit, action or proceeding brought in any such court
and any claim that any such suit, action or proceeding brought in any such court
has been brought in an inconvenient forum.

         (b) Each party hereto agrees, to the fullest extent that it may
effectively do so under applicable law, that a judgment in any suit, action or
proceeding of the nature referred to in Section 17(a) brought in any such court
shall be conclusive and binding upon such party, subject to rights of appeal and
may be enforced in the courts of the United States of America or the State of
New York (or any other court the jurisdiction to which the Company is or may be
subject) by a suit upon such judgment.

         SECTION 0.18. Couterparts.

         This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts shall each be
deemed to be an original but all such counterparts shall together constitute one
and the same instrument.

         SECTION 0.19. Headings.

         The headings herein are inserted for convenience of reference only and
are not intended to be part of, or to affect the meaning or interpretation of,
this Agreement.

         SECTION 0.20. Severability.

         If any provision of this Agreement shall be held or deemed to be or
shall, in fact, be invalid, inoperative or unenforceable as applied in any
particular case in any or all jurisdictions because it conflicts with any
provisions of any constitution, statute, rule or public policy or for any other
reason, then, to the extent permitted by law, such circumstances shall not have
the

                                      H-18

<PAGE>

effect of rendering the provision in question invalid, inoperative or
unenforceable in any other case, circumstance or jurisdiction, or of rendering
any other provision or provisions of this Agreement invalid, inoperative or
unenforceable to any extent whatsoever.

         SECTION 0.21. Amendments.

         This Agreement may be amended by an instrument in writing signed by the
parties hereto. The Company agrees that it will not enter into, cause or permit
any amendment or modification of the Transaction Documents or any other
instruments or agreements relating to the Senior Notes or the Corporate Units
that would in any way adversely affect the rights, duties or obligations of any
of Citigroup, Goldman Sachs or Merrill Lynch, each as a potential Remarketing
Agent, without the prior written consent of the Remarketing Agent Candidates.

         SECTION 0.22. Successors and Assigns.

         The rights and obligations of the Company hereunder may not be assigned
or delegated to any other Person without the prior written consent of the
Remarketing Agent. The rights and obligations of the Remarketing Agent hereunder
may not be assigned or delegated to any other Person (other than an affiliate of
the Remarketing Agent) without the prior written consent of the Company.

         If the foregoing correctly sets forth the agreement by and between the
Company, the Remarketing Agent and the Purchase Contract Agent, please indicate
your acceptance in the space provided for that purpose below.

                                      H-19

<PAGE>

                       [SIGNATURES ON THE FOLLOWING PAGE]

                                      H-20

<PAGE>

                                             Very truly yours,
                                             THE CHUBB CORPORATION

                                             By: _______________________________
                                                    John D. Finnegan
                                                    Chief Executive Officer

         CONFIRMED AND ACCEPTED:

         CITIGROUP GLOBAL MARKETS INC.

         By:_____________________________

         GOLDMAN, SACHS & CO.

         By:_____________________________

         MERRILL LYNCH, PIERCE, FENNER & SMITH
                       INCORPORATED

         By: _____________________________

         BANK ONE TRUST COMPANY, N.A.
         not individually but solely as Purchase Contract Agent
         and as attorney-in-fact for the Holders of the Purchase Contracts

         By:_____________________________

                                      H-21

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