Document:

<PAGE>   1
                                                                   EXHIBIT 10.11

                         EXECUTIVE EMPLOYMENT AGREEMENT

     This EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is entered into and
made effective as of the 16th day of June, 1997 (the "Effective Date"), by and
between New England Life Insurance Company (the "Company") and James M. Benson
(the "Executive").

     The Company desires to engage the services of the Executive as its
President and Chief Operating Officer, and the Executive desires to accept such
engagement, on the terms and subject to the conditions hereinafter set forth.

     In consideration of the mutual promises, terms, provisions and conditions
set forth in this Agreement and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
agree as follows:

     1. Employment. Subject to the terms and conditions set forth in this
Agreement, the Company hereby employs the Executive and the Executive hereby
accepts employment by the Company.

     2. Term. Subject to earlier termination as hereinafter provided, the
Executive's employment hereunder shall be for a term of three (3) years,
commencing on the Effective Date. This Agreement may be extended or renewed only
by written agreement of the Executive and an expressly authorized representative
of the Board of Directors of the Company (the "Board").

     3. Capacity and Performance.

         a. During the term hereof, the Executive shall initially serve the
Company as its President and Chief Operating Officer and thereafter, within
eighteen (18) months of the Effective Date, shall be appointed Chief Executive
Officer of the Company. As President and Chief Operating Officer, the Executive
will report to the Company's Chief Executive Officer. Thereafter, as Chief
Executive Officer of the Company, the Executive will report to the Board of
Directors of the Company and to the President and Chief Operating Officer (or an
officer of higher status) of Metropolitan Life Insurance Company of New York.

         b. As President, Chief Operating Officer and, thereafter, as Chief
Executive Officer of the Company, the Executive shall perform such assignments
and have such duties and authorities as are appropriate to his position(s), and
shall perform such assignments and have such other related duties as may
reasonably be assigned, delegated, designated or modified from time to time by
those to whom he reports and by the Board or its Chairman. The Executive's
duties shall include, without limitation, overall operational responsibility for
all Company business, including the oversight of sales, marketing, promotion,
strategic planning and development for the Company's business; provided,

<PAGE>   2

however, it is understood and agreed that, during the Executive's employment as
Chief Operating Officer, Robert A. Shafto shall retain responsibility for the
Company's Full Financial Services Firm and Electronic Commerce Projects.

         c. The Executive shall be recommended for appointment to the Company's
Board as soon as may be practicable, but in no event later than the next
scheduled meeting of the Board.

         d. During the term hereof, the Executive shall devote his full business
time and his best efforts, business judgment, skill and knowledge exclusively to
the advancement of the business and interests of the Company and its Affiliates
and to the discharge of his duties and responsibilities hereunder, except that
the Executive may devote a reasonable amount of time to charitable endeavors and
to personal affairs and, subject to the approval of the Board, may serve on the
boards of directors of other corporations, trade associations or charitable
organizations, to the extent that such exceptions do not interfere with the
Executive's responsibilities to the Company and its Affiliates. The Executive
shall not engage in any other business activity during the term hereof, except
as may be approved in advance by the Board. As used in this Agreement,
"Affiliates" means all persons and entities directly or indirectly controlling,
controlled by or under common control with the Company, where control may be by
management authority, equity interest or otherwise.

     4. Compensation and Benefits. As compensation for all services performed by
the Executive under and during the term hereof and subject to performance of the
Executive's duties and of the obligations of the Executive to the Company and
its Affiliates:

         a. Base Salary. During the term hereof, the Company shall pay the
Executive a base salary (the "Base Salary") at the rate of not less than Five
Hundred Thousand Dollars ($500,000) per annum, payable in accordance with the
Company's regular payroll practices, such Base Salary to be increased in an
amount determined by the Board in its discretion upon the Executive's
appointment as Chief Executive Officer.

         b. Signing Bonus. Within thirty (30) days following the Effective Date,
the Executive will receive from the Company a one-time signing bonus of Three
Hundred Thousand Dollars ($300,000).

         c. Bonus Compensation. During the term hereof, the Executive shall be
entitled to participate in the Company's short-term incentive compensation plan
and long-term incentive compensation plan, each as in effect from time to time.
Except as otherwise expressly provided herein, the Executive's participation in
the Company's short-term and long-term incentive compensation plans shall be
subject to (A) the terms of the applicable plan documents, (B) generally
applicable policies of the Company, and (C) the discretion of the Board or any
committee of the Board provided for in or contemplated by such plans. The
Executive understands and agrees that the Company may amend, replace or
terminate any or

                                      -2-

<PAGE>   3

all of its incentive compensation plans from time to time in the sole discretion
of the Board and that nothing contained herein shall obligate the Company to
continue any such plan or any term thereof; provided, however, that amendment,
replacement or termination of one or all of the plans shall not affect the
Executive's right to receive not less than the guaranteed minimum bonuses set
forth below during his employment under this Agreement. The Executive shall be
entitled to receive, for the plan year in which termination of his employment
occurs, a bonus under any incentive compensation plan in which he is then a
participant, pro-rated to the date of termination and calculated as if his
target bonus under that plan had been met, provided that termination occurs
pursuant to Section 6.a., Section 6.b, Section 6.d or 6.f hereof.

     It is agreed that the Executive's target bonus under the short-term
incentive plan shall be equal to the target bonus of the Company's Chief
Executive Officer (the "CEO") under that plan, expressed as a percentage of base
salary, and that, for purposes of the Executive's participation in the
short-term incentive plan in calendar year 1997, the Executive shall be treated
as if he had been employed by the Company as of January 1,1997. Provided that he
is employed hereunder at the time the 1997 short-term incentive compensation
bonus is payable to executives of the Company generally, the Executive shall be
guaranteed a minimum short-term incentive bonus of Three Hundred Thousand
Dollars ($300,000) for calendar year 1997, payable in 1998; provided, however,
that in the event the Executive's short-term bonus compensation, calculated in
accordance with the terms of the Company's short-term incentive compensation
plan, exceeds his guaranteed minimum short-term incentive bonus hereunder for
calendar year 1997, the Executive shall be entitled to the higher short-term
incentive bonus for that year.

     It is agreed that the Executive's target bonus under the Company's
long-term incentive plan, (i) shall be one-third of the CEO's target bonus for
the three-year performance cycle of 1995, 1996 and 1997, expressed as a
percentage of base salary; (ii) shall be two-thirds of the CEO's target bonus
for the three-year performance cycle of 1996, 1997 and 1998, expressed as a
percentage of base salary; and (iii) shall be equal to the CEO's target bonus
for the three-year performance cycle of 1997, 1998 and 1999, expressed as a
percentage of base salary. Provided that he is employed hereunder on the last
day of the performance cycle for the following long-term incentive compensation
bonuses, the Executive shall be guaranteed a minimum long-term incentive bonus
of Three Hundred Thousand Dollars ($300,000) for the three-year performance
cycle of 1995, 1996 and 1997, payable in 1998, and a minimum bonus of Four
Hundred Thousand Dollars ($400,000) for the three-year performance cycle of
1996, 1997 and 1998, payable in 1999; provided, however, in the event the
Executive's long-term bonus compensation, calculated in accordance with the
terms of the Company's long-term incentive plan, exceeds his guaranteed minimum
bonus payable in 1998 and/or 1999, the Executive shall be entitled to the higher
long-term incentive bonus for such year(s).

                                       -3-

<PAGE>   4

         d. Employee Benefits.

               i.   Retirement Plans. During the term hereof, the Executive
                    shall participate in The New England Retirement Plan &
                    Trust, an ERISA-qualified pension plan, The New England
                    Profit Sharing Plan and The New England Profit Sharing Plan
                    and Trust (the Company's 401(k) savings and profit-sharing
                    plan), as well as The New England Supplemental Retirement
                    Plan, The New England Select Employees Supplemental
                    Retirement Plan, The New England Select Employees
                    Supplemental Profit Sharing Plan and Home Office
                    Non-Qualified Elective Deferral Plan (nonqualified
                    supplemental executive retirement plans), all as may be in
                    effect from time to time. Such participation shall be
                    subject to (A) the terms of the applicable plan documents,
                    (B) generally applicable policies of the Company, and (C)
                    the discretion of the plan administrators provided for in or
                    contemplated by such plan(s).

               ii.  Individual Retirement Arrangement. In addition to any
                    entitlements the Executive may otherwise have under the
                    Company's qualified and non-qualified retirement plans
                    described in subsection i directly above, the Company
                    guarantees the Executive an enhanced pension benefit of Four
                    Hundred Thousand Dollars ($400,000) per annum, payable as a
                    twenty (20) year continuous and certain annuity starting at
                    age 62, subject to the vesting requirements set forth
                    herein. During the term hereof, the Executive shall vest in
                    this non-qualified benefit at the rate of Ten Percent (10%)
                    per annum. In the event the Company terminates the
                    Executive's employment in accordance with Section 6.d hereof
                    or the Executive terminates his employment for "Good Reason"
                    in accordance with Section 6.f hereof, the Executive's
                    vesting in the enhanced pension benefit will be
                    retroactively accelerated at the rate of an additional Ten
                    Percent (10%) per year of service. In the event of a final
                    partial year of service, the Executive shall be vested for
                    such year on a pro-rated basis to the date of termination.
                    Notwithstanding expiration of the term of this Agreement,
                    this Section 4.d.ii shall continue in effect throughout the
                    Executive's employment with the Company.

               iii. Health and Welfare Plans. During the term hereof and subject
                    to any contribution therefor generally required of employees
                    of the Company, the Executive shall be entitled to
                    participate in any and

                                       -4-

<PAGE>   5

                    all employee benefit plans from time to time in effect for
                    employees of the Company generally, except to the extent
                    such plans are in a category of benefit (such as severance
                    pay) otherwise provided to the Executive hereunder.
                    Participation in such plans (including without limitation
                    any post-retirement medical, dental or life insurance plan)
                    shall be subject to (1) the terms of the applicable plan
                    documents, (2) generally applicable Company policies and (3)
                    the discretion of the plan administrators provided for in or
                    contemplated by such plan. The Company may alter, modify,
                    add to or delete its employee benefit plans and its
                    retirement plans set forth in subsection i hereof at any
                    time as it, in its sole discretion, determines to be
                    appropriate, without recourse by the Executive.

               iv.  Vacation and Leave. The Executive will be entitled to five
                    (5) weeks of paid vacation per calendar year, to be taken at
                    such times and at such intervals as shall be determined by
                    the Executive, subject to the reasonable business needs of
                    the Company. In addition, the Executive shall be entitled to
                    sick leave and paid holidays, consistent with the terms of
                    applicable Company policies, as in effect from time to time.

               v.   Relocation. The Executive is expected to relocate from
                    Connecticut to Massachusetts promptly following the
                    Effective Date. In that connection, the Company will
                    reimburse the Executive his reasonable relocation expenses
                    in accordance with the Company's policy, subject to such
                    substantiation and documentation as the Company may
                    reasonably require. The Company will also give consideration
                    to any additional reasonable relocation expenses which are
                    unique to the Executive's circumstances.

               vi.  Business Expenses. Subject to such policies regarding
                    expenses and expense reimbursement as may be adopted from
                    time to time by the Company and compliance therewith by the
                    Executive, the Company shall pay or reimburse the Executive
                    for all reasonable business expenses incurred or paid by the
                    Executive in the performance of his duties and
                    responsibilities hereunder, subject to any maximum annual
                    limit and other restrictions on such expenses as may be set
                    by the Board and further subject to such reasonable
                    substantiation and documentation as may be specified by the
                    Company from time to time.

                                       -5-

<PAGE>   6

     5. Indemnification. The Company shall indemnify and hold the Executive
harmless, to the maximum extent permitted by applicable law, from and against
any claim, loss or cause of action arising from or out of the Executive's
performance as an officer, director or employee of the Company or any of its
Affiliates or in any other capacity, including serving as a fiduciary, in which
the Executive serves at the request of, or for the benefit of, the Company.
During the term of this Agreement and for six years thereafter (or, if less,
throughout the period of any applicable statute of limitations), the Company
shall maintain directors and officers liability insurance which shall cover the
Executive, unless the Board shall determine that such insurance cannot be
maintained at commercially reasonable rates.

     6. Termination of Employment and Severance Payments. Notwithstanding
anything to the contrary contained in this Agreement, the Executive's employment
hereunder shall terminate during the term of this Agreement under the following
circumstances:

         a. Death. In the event of the Executive's death during the term hereof,
the Executive's employment shall immediately and automatically terminate. In
such event, the Company shall pay to the Executive's designated beneficiary or,
if no beneficiary has been designated by the Executive, to his estate: (i) any
earned and unpaid Base Salary, prorated through the date of the Executive's
death; (ii) bonus compensation to which the Executive is entitled in accordance
with Section 4.c hereof, prorated to the date of the Executive's death; (iii)
reimbursement in accordance with Section 4.d.v for any business expenses for
which the Executive has not yet been reimbursed and (iv) if the Executive's
eligible dependents elect continuation of their participation under the
Company's group medical and/or dental plan under the federal law known as
"COBRA", the Company will pay the frill premium cost of such participation for a
period of twelve (12) months following the date of the Executive's death or
until the dependent ceases to be eligible for participation under COBRA,
whichever is less.

          b. Disability.

               i.   The Company may terminate the Executive's employment
                    hereunder, upon notice to the Executive, in the event that
                    the Executive becomes disabled during his employment through
                    any illness, injury, accident or condition of either a
                    physical or psychological nature and, as a result, is unable
                    to perform substantially all of his duties and
                    responsibilities hereunder for one hundred and eighty (180)
                    days during any period of three hundred and sixty-five (365)
                    consecutive calendar days. In such event, the Company shall
                    pay the Executive the following: (a) any earned and unpaid
                    Base Salary, prorated through the date of termination; (b)
                    bonus compensation to which the Executive is entitled in
                    accordance with Section 4.c hereof, prorated to the

                                       -6-

<PAGE>   7

                    date of termination; (c) reimbursement in accordance with
                    Section 4.d.v. for any business expenses for which the
                    Executive has not yet been reimbursed; and (d) if the
                    Executive and/or his eligible dependents elect continuation
                    of their participation under the Company's group medical
                    and/or dental plan under COBRA, the Company will pay the
                    full premium cost of such participation for a period of
                    twelve (12) months following the date of termination of the
                    Executive's employment or until the Executive or the
                    dependent ceases to be eligible for participation under
                    COBRA, whichever is less.

               ii.  The Board may designate another employee to act in the
                    Executive's place during any period of the Executive's
                    disability. Notwithstanding any such designation, the
                    Executive shall continue to receive the Base Salary in
                    accordance with Section 4.a hereof and shall continue to
                    participate in the Company's benefit plans in accordance
                    with Section 4.d hereof to the extent permitted by the
                    then-current terms of the applicable benefit plans, until
                    the Executive becomes eligible for disability income
                    benefits under any disability plan provided to the Executive
                    by the Company or until the termination of his employment,
                    whichever shall first occur.

               iii. If any question shall arise as to whether during any period
                    the Executive is disabled through any illness, injury,
                    accident or condition of either a physical or psychological
                    nature so as to be unable to perform substantially all of
                    his duties and responsibilities hereunder, the Executive
                    may, and at the request of the Company shall, submit to a
                    medical examination by a physician selected by the Company
                    to whom the Executive or his duly appointed guardian, if
                    any, has no reasonable objection to determine whether the
                    Executive is so disabled, and such determination shall for
                    purposes of this Agreement be conclusive of the issue. If
                    such question shall arise and the Executive shall fail to
                    submit to such a medical examination, the Company's
                    determination of the issue shall be binding on the
                    Executive.

         c. By the Company for Cause. The Company may terminate the Executive's
employment hereunder for Cause at any time upon notice to the Executive setting
forth in reasonable detail the nature of such Cause. The following, as
determined by the Board in its reasonable judgment, shall constitute Cause for
termination:

                                       -7-

<PAGE>   8

                    willful gross neglect in the performance of the Executive's
                    duties and responsibilities to the Company and its
                    Affiliates as described in Section 3 hereof (other than a
                    failure resulting from disability); or

               ii.  the engaging of the Executive in the misappropriation of
                    funds, properties or assets of the Company of any of its
                    Affiliates, intentional tort(s), fraud or other material
                    dishonesty with respect to the Company or any of its
                    Affiliates, or other willful gross misconduct that is
                    reasonably likely to be materially harmful to the business,
                    interests or reputation of the Company or any of its
                    Affiliates; or

               iii. the Executive's conviction of a crime constituting a felony,
                    including the entry of a plea of guilty or no contest by the
                    Executive to a charge of a crime constituting a felony; or

               iv.  material breach by the Executive of any of the restrictive
                    covenants contained in Section 8 or 9 hereof.

Upon the giving of notice of termination of the Executive's employment hereunder
for Cause, the Company shall have no further obligation or liability to the
Executive nor to his beneficiary or estate, other than for Base Salary earned
and unpaid to the date of termination and reimbursement in accordance with
Section 4.d.v for any business expenses for which the Executive has not yet been
reimbursed.

         d. By the Company Other Than for Cause. The Company may terminate the
Executive's employment hereunder other than for Cause at any time upon notice to
the Executive. In the event of such termination, then, within forty-five (45)
days following the effective date of the Executive's termination, the Company
shall pay the Executive a single lump sum amount equal to the sum of two years'
Base Salary at the rate in effect on the date of termination plus two times the
Executive's target bonus under the Company's short-term incentive compensation
plan; provided, however, that the Company's obligations to make payments
hereunder are conditioned on the Executive's execution of a general release in
favor of the Company in such form as the Company shall specify. In addition to
the foregoing, the Company shall pay the Executive any Base Salary earned and
unpaid, prorated through the date of termination and any bonus compensation to
which the Executive is entitled in accordance with Section 4.c hereof, prorated
to the date of termination and shall reimburse the Executive in accordance with
Section 4.d.v. for any business expenses for which the Executive has not yet
been reimbursed.

         e. By the Executive for Other Than Good Reason. The Executive may
terminate his employment hereunder at any time upon three (3) months' notice to
the

                                       -8-

<PAGE>   9

Company. In the event of termination by the Executive pursuant to this Section
6.e, the Board may elect to waive the period of notice, or any portion thereof,
and, if the Board so elects, the Company will pay the Executive the Base Salary
for the notice period (or for any remaining portion of that period). Upon
termination of the Executive's employment pursuant to this Section 6.e, the
Company shall have no further obligation or liability to the Executive nor to
his beneficiary or estate, other than for Base Salary earned and unpaid,
prorated to the date of termination, and reimbursement in accordance with
Section 4.d.v. for any business expenses for which the Executive has not yet
been reimbursed.

         f. By the Executive for Good Reason. The Executive may terminate his
employment hereunder for Good Reason, provided that the Executive provides
written notice to the Company, setting forth in reasonable detail the nature of
such Good Reason, within sixty (60) days of the occurrence of the circumstances
giving rise to the Good Reason; the Company fails to cure within forty-five (45)
days following its receipt of such notice; and the Executive thereupon gives
thirty (30) days' written notice of termination; provided further, however, that
in the event of termination by the Executive for Good Reason in accordance with
subsection (iv) below, the Executive need only give thirty (30) days' notice of
termination, but must do so within sixty (60) days of the Change of Control. For
purposes of this Section 6.f, "Good Reason" shall mean any act or omission
identified below to which the Executive does not consent and which does not
occur in connection with the replacement of the Executive during any period of
disability or termination of the Executive's employment for Cause or disability,
as provided in this Agreement. The following shall constitute "Good Reason" for
termination by the Executive:

     (i) Any (A) failure to designate or redesignate the Executive as, or (B)
removal of the Executive from or failure to re-elect the Executive to, any of
the following positions:

         (I) Chief Executive Officer of the Company (to occur within eighteen
months of the Effective Date); or

         (II) Member of the Board of Directors of the Company;

     (ii) Any assignment to the Executive of any duties, functions, or
responsibilities, that

         (I) is materially inconsistent with the Executive's positions described
in Section 3 above, or

         (II) requires the Executive to report to anyone other than the CEO, the
Company's Board, or the President and Chief Operating Officer (or higher level
officer) of Metropolitan Life Insurance Company of New York, or

                                       -9-

<PAGE>   10

         (III) deprives the Executive of effective supervision and control over,
and responsibility for, the strategic direction and general and active
day-to-day leadership and management (including the structure and organization
of such leadership and management) of the business and affairs of the Company,
subject to the direction and control of the Board; provided, however, that the
sale or transfer of any of the Company's Affiliates, or of any or all of the
assets of any of the Affiliates, shall not constitute "Good Reason" and provided
further that any change or diminution in the business of the Company shall not
constitute Good Reason unless constituting a "Change of Control" in accordance
with subsection (iv) of this Section 6.f; or

         (IV) substantially interferes with the Executive's ability to
substantially perform the duties, functions or responsibilities, or exercise the
authority, of his positions as described in Section 3 above;

     (iii) any substantial, objectively demonstrable failure by the Company to
materially comply with the provisions of Section 4 above; or

     (iv) a Change of Control, meaning the occurrence hereafter of one of the
following events: (I) any "person," as such term is used in Sections 3(a)(9)
and 13(d) of the Securities Exchange Act of 1934, as amended (the "Act"),
becomes a "beneficial owner," as such term is used in Rule 13d-3 promulgated
under the Act, of twenty-five percent (25%) or more of the voting stock of the
Company; (II) the Company adopts any plan of liquidation providing for
distribution of all or substantially all of its assets; (III) all or
substantially all of the assets or business of the Company is disposed of
pursuant to a merger, consolidation or other transaction (unless the
shareholders of the Company immediately prior to such merger, consolidation or
other transaction beneficially own, directly or indirectly, in substantially the
same proportion as they owned the voting stock of the Company, all of the voting
stock or other ownership interests of the entity or entities, if any, that
succeed to the business of the Company); or (IV) the Company combines with
another company and is the surviving corporation but, immediately after the
combination, the shareholders of the Company immediately prior to the
combination hold, directly or indirectly, fifty percent (50%) or less of the
voting stock of the combined company (there being excluded from the number of
shares held by such shareholders, but not from the voting stock of the combined
company, any shares received by affiliates of such other company in exchange for
stock of such other company).

     In the event of a termination by the Executive in accordance with this
Section 6.f, then, within forty-five (45) days following the effective date of
the Executive's termination, the Company shall pay the Executive a single lump
sum amount equal to the sum of two years' Base Salary at the rate in effect on
the date of termination plus two times the Executive's target bonus under the
Company's short-term incentive compensation plan; provided, however, that the
Company's obligations to make payments hereunder are conditioned on the

                                      -10-

<PAGE>   11

Executive's execution of a general release in favor of the Company in such form
as the Company shall specify. In addition to the foregoing, the Company shall
pay the Executive any Base Salary earned and unpaid, prorated through the date
of termination and bonus compensation to which the Executive is entitled in
accordance with Section 4.c hereof, prorated to the date of termination and
shall reimburse the Executive in accordance with Section 4.d.v. for any business
expenses for which the Executive has not yet been reimbursed.

         g. No Mitigation: No Offset. In the event of any termination of
employment, the Executive shall be under no obligation to seek other employment
and there shall be no offset against amounts due him under this Agreement on
account of any remuneration attributable to any subsequent employment that he
may obtain.

         h. Post-Agreement Employment. In the event the Executive remains in the
employ of the Company or any of its Affiliates following termination of this
Agreement, by the expiration of the term or otherwise, then such employment
shall be at will.

     7. Effect of Termination.

         a. In the event of termination of the Executive's employment hereunder,
payment by the Company in accordance with the applicable provision of Section 6
above shall constitute the entire obligation of the Company to the Executive.
Except as otherwise expressly provided for in this Agreement, and except for any
right that the Executive may have to continue participation in the Company's
group medical and/or dental plan at his cost under applicable law, the
Executive's participation in the Company's benefit plans shall terminate
pursuant to the terms of the applicable benefit plans based on the date of
termination of the Executive's employment, without regard to any continuation of
Base Salary or other payment to the Executive following such date of
termination.

         b. Notwithstanding the foregoing, in the event of termination of the
Executive's employment pursuant to Section 6.a, Section 6.b, Section 6.d or
Section 6.f, the Executive and his spouse shall be entitled to post-retirement
medical coverage to the same extent that, and on the same terms as,
post-retirement medical coverage is provided to executives of Metropolitan Life
Insurance Company of New York and their spouses generally; provided, however,
that any length of service requirement for eligibility will be waived and
provided further that such coverage shall be secondary to coverage provided by
any subsequent employer.

         c. Provisions of this Agreement shall survive termination of this
Agreement, by expiration of the term or otherwise, if so provided herein or if
necessary or desirable to accomplish the purposes of other surviving provisions,
including without limitation the obligations of the Executive under Sections 8
and 9 hereof. The obligation of the Company to make payments to or on behalf of
the Executive under Section 6 hereof is expressly conditioned upon the
Executive's continued full performance of his obligations under

                                      -11-

<PAGE>   12

Sections 8 and 9. The Executive recognizes that, except as expressly provided
herein, no compensation is earned after termination of employment.

     8. Confidential Information.

         a. The Executive acknowledges that the Company and its Affiliates
continually develop Confidential Information, that the Executive may develop
Confidential Information for the Company and its Affiliates, and that the
Executive may learn of Confidential Information during the course of employment.
The Executive will comply with the policies and procedures of the Company for
protecting Confidential Information and shall never use or disclose to any
person, corporation or other entity (except as required by applicable law or for
the proper performance of his regular duties and responsibilities for the
Company and its Affiliates) any Confidential Information obtained by the
Executive incident to his employment or other association with the Company or
any of its Affiliates. The Executive understands that this restriction shall
continue to apply after his employment terminates, regardless of the reason for
such termination. For purposes of this Agreement, "Confidential Information"
means any and all information of the Company and its Affiliates or concerning
the business, clients or affairs of the Company or any of its Affiliates, that
is not generally known by others with whom any of them compete or do business,
or with whom any of them plan to compete or do business. Confidential
Information includes without limitation such information relating to (i) the
development, research, testing, manufacturing, marketing, strategies, and
financial activities of the Company and its Affiliates, (ii) the products and
services, present and in contemplation, of the Company and its Affiliates, (iii)
inventions, processes, operations, administrative procedures, databases,
programs, systems, flow charts, software, firmware and equipment used in the
business of the Company or any of its Affiliates, (iv) customer lists and
customer information of the Company and its Affiliates, (v) their costs,
financial performance and strategic plans, (vi) the identity and special needs
of those with whom the Company and its Affiliates do business and (vii) the
people and organizations with whom the Company and its Affiliates have business
relationships and the substance of those relationships. Confidential Information
also includes all information that the Company or any of its Affiliates has
received belonging to others with any understanding, express or implied, that it
would not be disclosed.

         b. All documents, records, tapes and other media of every kind and
description relating to the business, present or otherwise, of the Company and
its Affiliates and any copies, in whole or in part, thereof (the "Documents"),
whether or not prepared by the Executive, shall be the sole and exclusive
property of the Company and its Affiliates; provided, however, the Executive
shall be entitled to retain his personal notes, diaries, rolodexes,
correspondence and other materials of a personal nature that do not contain
Confidential Information. The Executive shall safeguard all Documents and shall
surrender to the Company at the time his employment terminates, or at such
earlier time or times as the Board or its designee may specify, all Documents
then in the Executive's possession or control.

                                      -12-

<PAGE>   13

     9. Restricted Activities. The Executive expressly recognizes that the
employees, general agents and agents of the Company and its Affiliates are
important and critical aspects of their ability to operate profitably. The
Executive, therefore, further agrees that, while he is employed by the Company,
other than in the course of performing his duties hereunder, and for a period of
one (1) year following termination of his employment for any reason, he will not
directly or indirectly (i) hire or solicit for hiring any employee of the
Company or any of its Affiliates or seek to persuade any employee of the Company
or any of its Affiliates to discontinue employment, (ii) hire or solicit for
hiring any employee of any general agent of the Company or any of its
Affiliates; or (iii) solicit or encourage any general agent or other independent
contractor providing services to the Company or any of its Affiliates to
terminate or diminish its relationship with them.

     10. Enforcement of Covenants. In signing this Agreement, the Executive
gives the Company assurance that he has carefully read and considered all the
terms and conditions of this Agreement, including the restraints imposed on him
under Sections 8 and 9 hereof. The Executive agrees without reservation that
these restraints are necessary for the reasonable and proper protection of the
Company and its Affiliates; that each and every one of the restraints is
reasonable in respect to subject matter, length of time and geographic area; and
that these restraints will not prevent him from obtaining other suitable
employment during the Non-Competition Period. The Executive further agrees that,
were he to breach any of the covenants contained in Section 8 or 9 hereof, the
damage to the Company and its Affiliates would be irreparable. The Executive
therefore agrees that the Company, in addition to any other remedies available
to it, shall be entitled to preliminary and permanent injunctive relief against
any breach or threatened breach by the Executive of any of those covenants,
without having to post bond, and that he will not take, and he will not permit
anyone else to take on his behalf, any position in a court or any other forum
inconsistent with any of his covenants relating to this Section 10. The
Executive and the Company further agree that, in the event that any provision of
Section 8 or 9 is determined by any court of competent jurisdiction to be
unenforceable by reason of its being extended over too great a time, too large a
geographic area or too great a range of activities, that provision shall be
deemed to be modified to permit its enforcement to the maximum extent permitted
by law. It is also agreed that each of the Company's Affiliates shall have the
right to enforce all of the Executive's obligations to that Affiliate under this
Agreement, including without limitation pursuant to Sections 8 and 9 hereof.

     11. Resolution of Disputes. Any dispute arising under or in connection with
this Agreement, other than a dispute arising under Section 8, 9 or 10 hereof,
shall, at the election of the Executive or the Company, be resolved by binding
arbitration conducted in Boston, Massachusetts in accordance with the Commercial
Rules of the American Arbitration Association then in force and the laws of the
Commonwealth of Massachusetts. Judgment upon the award rendered by the
arbitrator(s) may be enforced and executed upon in any court having jurisdiction
over the party against whom enforcement of such award is sought.

                                      -13-

<PAGE>   14

The parties involved in the dispute shall divide equally the administrative
charges, arbitrator's fees and related expenses of the arbitration, but each
party shall pay its own legal fees incurred in connection with such arbitration.

     12. Conflicting Agreements. The Executive hereby represents and warrants
that the execution of this Agreement and the performance of his obligations
hereunder will not breach or be in conflict with any other agreement to which
the Executive is a party or is bound, and that the Executive is not now subject
to any covenants against competition or similar covenants that would affect the
performance of his obligations hereunder. The Executive will not disclose to or
use on behalf of the Company any proprietary information of a third party
without such party's consent.

     13. Withholding. All payments made by the Company under this Agreement
shall be reduced by any tax or other amounts required to be withheld by the
Company under applicable law.

     14. Assignment. This Agreement is personal in its nature, and neither the
Company nor the Executive may make any assignment of this Agreement or any
interest herein, by operation of law or otherwise, without the prior written
consent of the other; provided, however, that the Company may assign its rights
and obligations under this Agreement without the consent of the Executive in the
event that the Company shall hereafter effect a reorganization, consolidate
with, or merge into, any other entity or transfer all or substantially all of
its properties or assets to any other entity. This Agreement shall inure to the
benefit of and be binding upon the Company and the Executive, their respective
successors, executors, administrators, heirs and permitted assigns.

     15. Severability. If any portion or provision of this Agreement shall to
any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

     16. Waiver. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of either party to
require the performance of any term or obligation of this Agreement, or the
waiver by either party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.

     17. Notices. Any and all notices, requests, demands and other
communications provided for by this Agreement shall be in writing and shall be
effective as provided herein when delivered in person or by overnight air
courier or deposited in the United States mail, postage prepaid, registered or
certified, return receipt requested and addressed to the persons

                                      -14-

<PAGE>   15

and addresses listed below, or to such other address as either party may specify
by notice to the other actually received. Each notice shall, simultaneously with
its being delivered to the courier or messenger for delivery or placed in the
mail, be sent when possible by facsimile or comparable electronic means. All
notices and other communications hereunder shall be deemed to have been given:
(i) on the date of delivery if personally delivered; (ii) on the first business
day after the date sent if sent by overnight air courier; or (iii) on the fifth
business day after the date sent if sent by mail.

If to the Company:

The General Counsel
New England Life Insurance Company
501 Boylston Street
Boston, MA 02115-3700

If to the Executive:

James M. Benson
524 Lake Avenue
Greenwich, CT 06830

     18. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto, and supersedes all prior and contemporaneous
communications, agreements and understandings, written or oral, with respect to
the terms and conditions of the Executive's employment.

     19. Amendment. This Agreement may be amended or modified only by a written
instrument signed by the Executive and an expressly authorized representative of
the Board.

     20. Headings. The headings and captions in this Agreement are for
convenience only, and in no way define or describe the scope or content of any
provision of this Agreement.

     21. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall, when executed, be deemed to be an original
and all of which together shall constitute one and the same instrument.

     22. Governing Law. This is a Massachusetts contract and shall be construed
and enforced under and be governed in all respects by the laws of the
Commonwealth of Massachusetts, without regard to the conflict of laws principles
thereof.

                                      -15-

<PAGE>   16

     IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by the Company, by its duly authorized representative, and by the Executive, as
of the date first above written.

THE EXECUTIVE:                          THE COMPANY:
                                        NEW ENGLAND LIFE INSURANCE COMPANY

 /s/ James M. Benson                    By: /s/ Robert A. Shafto
---------------------                      -------------------------------------
        James M. Benson                     Robert A. Shafto
                                            Chairman and Chief Executive Officer<PAGE>   1
                                                                   Exhibit 10.13

NOTICE: DEFENSE EXPENSES ARE INCLUDED IN LOSS AND SUBJECT TO THE AGGREGATE LIMIT
OF INDEMNITY.

                       STOCKWOOD REINSURANCE COMPANY, LTD.

                            (the "Insurance Company")

                             POLICY NUMBER: 04-03-22

                  RESTATEMENT OF THE EXCESS ASBESTOS INDEMNITY
                                INSURANCE POLICY

                                  DECLARATIONS

ITEM 1.   NAME OF INSURED:                  Metropolitan Life Insurance Company
                                            One Madison Avenue
                                            New York, NY  10010

                                            together with its successors and
                                            permitted assigns.

ITEM 2.   PERIOD OF INDEMNIFICATION:
                                            From November 30, 1998 (the "Policy
                                            Inception Date") until the earlier
                                            of (a) the exhaustion of the
                                            Aggregate Limit of Indemnity, or (b)
                                            the Commutation Date (as defined in
                                            this Policy) (in each case at 12:01
                                            A.M. at the address stated in Item
                                            1).

ITEM 3.   (A)  AGGREGATE LIMIT OF
               INDEMNITY:                   Three Hundred Seventy-Five Million
                                            Dollars ($375,000,000) as the
                                            Insurance Company's Quota Share of
                                            One Billion Five Hundred Million
                                            Dollars ($1,500,000,000) in the
                                            absolute aggregate for all Loss
                                            excess of the Retention (as
                                            hereinafter defined).

          (B)  ANNUAL SUBLIMIT AND PER
               CLAIMANT LIMIT:              As set forth in Section 3 of the
                                            Policy. The Annual Sublimit and the
                                            Per Claimant Limit shall be a part
                                            of, and not in addition to, the
                                            Aggregate Limit of Indemnity.

          (C)  RETENTION:                   As set forth in Section 4 of the
                                            Policy.
<PAGE>   2
                                       2

ITEM 4.   PREMIUM:                          Two Hundred Fifteen Million Dollars
                                            ($215,000,000), payable in full on
                                            or before December 31, 1998.

ITEM 5.   NOTICES:                          All Notices under the Policy shall
                                            be made in the manner prescribed in
                                            the Policy to the addresses set
                                            forth below;

                                            If to the Insured, to:

                                                Metropolitan Life
                                                    Insurance Company
                                                One Madison Avenue
                                                New York, NY  10010
                                                Attention:  General Counsel
                                                with a copy to:  Risk Manager
                                                Facsimile:  (212) 578-3916

                                            If to the Insurance Company, to:

                                                Stockwood Reinsurance
                                                    Company, Ltd.
                                                Carleton Court
                                                High Street
                                                Bridgetown, Barbados
                                                Attention:  Tim Courtis
                                                Facsimile:  (246) 431-0522
<PAGE>   3
                   EXCESS ASBESTOS INDEMNITY INSURANCE POLICY

In consideration of the payment of the Premium and the mutual covenants and
promises herein, in light of the representations and warranties made in
connection herewith, and subject to the Declarations that are a part of this
Excess Asbestos Indemnity Insurance Policy and to the terms, conditions,
exclusions and limitations contained in this Excess Asbestos Indemnity Insurance
Policy (all of which collectively constitute this "Policy"), the Insurance
Company and the Insured hereby agree as follows:

SECTION 1.        INSURING AGREEMENT

Subject to the terms and conditions of this Policy (including the Aggregate
Limit of Indemnity, the Annual Sublimit and the Per Claimant Limit), the
Insurance Company will indemnify the Insured during the Period of
Indemnification for the Insurance Company's Quota Share of the excess of (a) any
and all Loss for the defense and settlement of, or payment of judgments in,
Asbestos-Related Claims, arising out of events described in Section 2(C)(ii)
occurring prior to the Policy Inception Date; over (b) the Retention.

SECTION 2.        DEFINITIONS

As used in this Policy, the following terms shall have the following meanings:

         (A)      "Aggregate Limit of Indemnity" has the meaning given to such
                  term in Item 3(A) of the Declarations of this Policy.

         (B)      "Annual Sublimit" has the meaning given to such term in
                  Section 3.2 of this Policy.

         (C)      "Asbestos-Related Claim" means any Claim against the Insured
                  for Bodily Injury allegedly caused by, arising out of, or
                  relating to, in whole or in part, any exposure to asbestos,
                  but only where such Claim:

                           (i)      is sought, or threatened, to be enforced in
                                    the Territory against the Insured; and

                           (ii)     alleges (a) activities of Dr. Anthony J.
                                    Lanza on behalf of the Insured; or (b) the
                                    Insured's operation prior to January 1, 1970
                                    of its Industrial Hygiene Division or
                                    Section, regarding research, testing or
                                    reporting of results associated with
                                    asbestos; or (c) any alleged knowledge of
                                    the Insured arising out of the operation
                                    described in clause (ii)(b) above relating
                                    to the Insured's alleged failure to warn of
                                    the hazards of asbestos, or to the Insured's
                                    alleged participation in any conspiracy,
                                    negligent or otherwise, relating to the
                                    hazards of asbestos.
<PAGE>   4
                                       2

         (D)      "Bodily Injury" means bodily injury to a person, including
                  without limitation, illness, sickness, disease, loss of
                  consortium, death, mental anguish, emotional distress, or fear
                  of cancer.

         (E)      "Business Day" means any day other than a Saturday, a Sunday
                  or a day on which banking institutions in New York, New York,
                  or the Islands of Bermuda are authorized or obligated by law,
                  regulation or executive order to be closed.

         (F)      "Claim" means any past, present or future claim, demand,
                  request, complaint, cross-complaint, cross-claim, right, suit,
                  lawsuit, action or proceeding or cause of action or order
                  seeking monetary relief (including, without limitation,
                  punitive or exemplary damages) or other relief (including,
                  without limitation, medical monitoring, injunctive or
                  declaratory relief).

         (G)      "Commutation Date" has the meaning given to such term in
                  Section 8.3 of this Policy.

         (H)      "Direct Actions" has the meaning given to such term in Section
                  8.4 of this Policy.

         (I)      "Disputed Net Loss" has the meaning given to such term in
                  Section 8.1(C) of this Policy.

         (J)      "Experience Value" has the meaning given to such term in
                  Section 7.7 of this Policy.

         (K)      "Insurance Company" has the meaning given to such term in the
                  Declarations of this Policy.

         (L)      "Insurance Company's Quota Share" means twenty-five percent
                  (25.00%).

         (M)      "Insurance Coverage Claim" means any past, present or future
                  Claim against the Insured seeking (a) monetary or other relief
                  (including without limitation, medical monitoring, injunctive
                  or declaratory relief) from the Insured under any insurance or
                  reinsurance policies or contracts issued by the Insured, or
                  (b) damages, injunctive or other relief due to allegedly
                  unlawful claims handling practices of the Insured, including
                  without limitation, any Claims against the Insured for bad
                  faith or breach of fiduciary duties due to the manner in which
                  the Insured investigated, settled or paid claims under any
                  insurance or reinsurance policies or contracts issued by the
                  Insured.

         (N)      "Insured" has the meaning given to such term in Item 1 of the
                  Declarations of this Policy.

         (O)      "Insured Payments" means (i) all amounts actually paid by the
                  Insured and (ii) all amounts actually paid on behalf of the
                  Insured by the issuers of the Settled Policies ("Issuers") in
                  connection with the Settled Policies excluding (x) payments to
                  the
<PAGE>   5
                                       3

                  Insured by the Issuers in connection with the Settled Policies
                  and (y) payments by the Insured to the Issuers in connection
                  with the Settled Policies.

         (P)      "Loss", except as set forth in Section 3.3 of the Claims
                  Handling and Cooperation Agreement executed simultaneously
                  herewith, means the amounts of Insured Payments made on or
                  after the Policy Inception Date,

                           (i)      in investigating or defending any
                                    Asbestos-Related Claims including fees and
                                    expenses of the Insured's national
                                    coordinating counsel, other attorneys' fees
                                    and expenses, premiums on attachment or
                                    appeal bonds, pre-judgment and post-judgment
                                    interest, and expenses for experts;

                           (ii)     in settling Asbestos-Related Claims for
                                    which:

                                    (a)     a written release,

                                    (b)     evidence of a physical condition
                                            that has been claimed in the
                                            scientific or medical literature to
                                            be caused by exposure to asbestos or
                                            asbestos containing products, and

                                    (c)     proof of exposure to asbestos or
                                            asbestos containing products (by way
                                            of interrogatory answer, affidavit
                                            (which may be included within the
                                            release), personnel record, work
                                            history sheet or other evidence of
                                            exposure

                                    have been obtained from or in respect of an
                                    individual, identified claimant in
                                    connection with any Asbestos-Related Claims;

                           (iii)    in satisfying judgments in connection with
                                    any Asbestos-Related Claims; and

                           (iv)     in settling Asbestos-Related Claims for
                                    which the documentation set forth in
                                    Sections (O)(ii)(a) through (c) above has
                                    not all been obtained, provided, however,
                                    that the cumulative amount of such payments
                                    included in Loss shall be no greater than 5%
                                    of the cumulative amount of Insured Payments
                                    made subsequent to the Policy Inception Date
                                    in settling Asbestos-Related Claims for
                                    which such documentation has been obtained.

                  "Loss" does not include the salaries, wages, or benefits of
                  the Insured's permanent or temporary employees, directors or
                  officers, including in-house lawyers, or the Insured's
                  administrative expenses, office expenses or overhead.

         (Q)      "Loss Offset" has the meaning given to such term in Section
                  7.6 of this Policy.

         (R)      "Loss Report" has the meaning given to such term in Section
                  8.1(A) of this Policy.
<PAGE>   6
                                        4

         (S)      "Losses to be paid by the Insurance Company on such Settlement
                  Date" has the meaning given to such term in Section 7.3(3) of
                  this Policy.

         (T)      "Per Claimant Average Amount" has the meaning given to such
                  term in Section 3.4 of this Policy.

         (U)      "Per Claimant Limit" has the meaning given to such term in
                  Section 3.3 of this Policy.

         (V)      "Period of Indemnification" has the meaning given to such term
                  in Item 2 of the Declarations of this Policy.

         (W)      "Policy Inception Date" has the meaning given to such term in
                  Item 2 of the Declarations of this Policy.

         (X)      "Premium" has the meaning given to such term in Item 4 of the
                  Declarations of this Policy.

         (Y)      "Premium Payment Date" means the day on which the total
                  Premium is received by the Insurance Company.

         (Z)      "Reference Value" has the meaning given to such term in
                  Section 7 of this Policy.

         (AA)     "Retention" has the meaning given to such term in Section 4 of
                  this Policy.

         (BB)     "Scheduled Underlying Policies" means the policies listed in
                  the attached Schedule A to this Policy.

         (CC)     "Settled Policies" means those policies issued by Travelers
                  Insurance Company or Travelers Indemnity Company listed in
                  Schedule B to this Policy.

         (DD)     "Settlement Date" has the meaning given to such term in
                  Section 7.1 of this Policy.

         (EE)     "Territory" means the United States of America, its
                  territories and possessions and the Commonwealth of Puerto
                  Rico.

SECTION 3.        LIMITS OF INSURANCE

3.1.     AGGREGATE LIMIT OF INDEMNITY

Regardless of the number of claimants or Asbestos-Related Claims covered under
this Policy, the maximum amount payable by the Insurance Company for all Loss
(including defense expenses) covered under this Policy shall not exceed Three
Hundred Seventy-Five Million Dollars ($375,000,000) in the absolute aggregate as
the Insurance Company's Quota Share of One Billion Five Hundred Million Dollars
($1,500,000,000) in the absolute aggregate for all Loss excess of the Retention.
<PAGE>   7
                                       5

This Aggregate Limit of Indemnity is the maximum amount recoverable by the
Insured under this Policy, excluding payments for commutation under this Policy.

3.2.     ANNUAL SUBLIMIT

Subject to the Aggregate Limit of Indemnity described in Section 3.1 above, the
maximum amount payable by the Insurance Company at any Settlement Date for all
Loss in the calendar year immediately prior to such Settlement Date ("calendar
year(x)"), during the Period of Indemnification in respect of Loss under this
Policy shall not exceed the Insurance Company's Quota Share of the Annual
Sublimit for calendar year(x). The Annual Sublimit shall be calculated by the
Insurance Company for calendar year(x) and shall be equal to:

         (1)      the Per Claimant Average Amount for calendar year(x)
                  multiplied by

         (2)      the "Number of Individual Asbestos-Related Claims" for
                  calendar year(x).

A claimant shall be included in the calculation of the "Number of Individual
Asbestos-Related Claims" for calendar year(x) when Loss is paid to that claimant
pursuant to the criteria in Sections 2(O)(ii), (iii) and (iv); provided,
however, that members of the same family without their own independent
asbestos-related injury due to their own exposure to asbestos shall all be
treated for purposes of this Policy as a single Asbestos-Related Claim with the
primary claim notwithstanding the fact that all such individuals may have
provided separate releases.

The "Number of Individual Asbestos-Related Claims" for purposes of the
calculation in the previous paragraph shall be determined by treating claims by
each individual qualifying claimant as a separate Asbestos-Related Claim
regardless of whether claims by such claimant are part of a group or bulk
settlement.

3.3.     PER CLAIMANT LIMIT

The Per Claimant Limit shall be One Hundred Fifty Million Dollars
($150,000,000), per claimant.

3.4.     PER CLAIMANT AVERAGE AMOUNT

On the 1st through 9th Settlement Dates, the Per Claimant Average Amount shall
be equal to the total amount paid by the Insured in calendar year 1996 for
asbestos-related claims divided by the number 15,750. The total amount paid by
the Insured in calendar year 1996 for such claims shall be agreed by the
Insurance Company and the Insured prior to the Premium Payment Date. Once such
amount is agreed to by the Insurance Company and the Insured, such amount shall
not be adjusted due to the receipt of any additional information or for any
other reason, except with the prior written consent of the Insured and the
Insurance Company.

On the 10th and each subsequent Settlement Date, the Per Claimant Average Amount
for calendar year(x) shall equal the Per Claimant Average Amount from the
previous Settlement Date, increased by the annual inflation change for the
previous calendar year(x)-1, if any, as defined by the United States Consumer
Price Index ("CPI") as of the Settlement Date for which the calculation is being
made and calculated by the Insurance Company as follows:
<PAGE>   8
                                       6

         Per Claimant Average Amount in calendar year(x) shall be equal to the
greater of:

         (1)      the Per Claimant Average Amount in calendar year(x)-1; or

         (2)      (the CPI in calendar year(x) divided by the CPI in calendar
                  year(x)-1) multiplied by the Per Claimant Average Amount in
                  calendar year(x)-1.

SECTION 4.        RETENTION

The Retention to be borne by the Insured under this Policy shall equal Four
Hundred Million Dollars ($400,000,000) plus all Loss paid by the Insured on or
after the Policy Inception Date and prior to the Premium Payment Date.

SECTION 5.        PREMIUM

The Premium of Two Hundred Fifteen Million Dollars ($215,000,000) for this
Policy shall be payable by the Insured in full on or before December 31, 1998.
The Premium shall be payable to the Insurance Company in immediately available
non-reversible funds, free and clear of any set-off, counterclaim or other
deduction. The Premium shall be payable to an account specified by the Insurance
Company.

The Premium shall be considered fully earned when received by the Insurance
Company.

If the Insured fails to pay the Premium in full and in accordance with the terms
of this Section, this Policy shall not come into effect and shall not in any way
bind the Insurance Company.

SECTION 6.        EXCLUSIONS

This Policy does not cover:

         (A)      Any injury or damage to property (tangible or intangible),
                  real or personal, including any resulting loss of use or
                  reduction in value of such property, no matter how such
                  injury, damage, loss of use or reduction in value occurred.

         (B)      Payments under any workers' compensation policies or plans,
                  employee benefit plans, or other employer liability of the
                  Insured.

         (C)      Any Insurance Coverage Claim.

SECTION 7.        EXPERIENCE VALUES

7.1.     SETTLEMENT DATE
<PAGE>   9
                                       7

For each calendar year, the Settlement Date will be a date designated by the
Insurance Company, which shall be within thirty-five (35) days of the later of:

         (i)      the receipt by the Insurance Company of the Insured's Loss
                  Report for the calendar year last ended; and

         (ii)     March 3rd of that calendar year.

7.2.     ANNUAL SETTLEMENT

On the Settlement Date, the Insurance Company shall:

         1.       Calculate:

                  a.       The application of the Annual Sublimit to Loss based
                           upon the Loss Report provided by the Insured;

                  b.       Any Loss Offset payable pursuant to Section 7.6;

                  c.       The remaining Retention;

                  d.       The "Losses to be paid by the Insurance Company on
                           such Settlement Date" pursuant to Section 7.3(3)
                           below;

                  e.       Disputed Net Loss (if any) pursuant to Section
                           8.1(C);

                  f.       "Actual amounts to be paid to the Insured" pursuant
                           to Section 7.3(4).

         2.       Report to the Insured:

                  a.       The calculations of Annual Sublimit, Loss Offset if
                           any, Retention, remaining Aggregate Limit of
                           Indemnity, and all other items calculated in Section
                           7.2(1);

                  b.       The Total Reference Value, together with a detailed
                           calculation thereof;

                  c.       The Experience Value, together with a detailed
                           calculation thereof;

                  d.       Schedule of all Disputed Net Loss (if any) pursuant
                           to Section 8.1(C).

         3.       Pay such amounts as calculated in Sections 7.2(1.e) and
                  7.2(1.f).

7.3.     CALCULATION OF AMOUNT TO BE PAID AT EACH SETTLEMENT DATE

         At each Settlement Date, the Insurance Company shall:

         1.       Determine the amount of the Annual Sublimit pursuant to
                  Section 3.2.

         2.       Determine the lesser of:
<PAGE>   10
                                       8

                  a.       the Annual Sublimit determined pursuant to Section
                           7.3(l), and

                  b.       the Losses according to the Insured's Loss Report.

         3.       Calculate the "Losses to be paid by the Insurance Company on
                  such Settlement Date", which shall equal: (a) the Insurance
                  Company's Quota Share of the quantity arrived at by
                  subtracting any remaining Retention from the amount determined
                  pursuant to Section 7.3(2) except that; (b) if the amount
                  determined pursuant to Section 7.3(3)(a) is less than zero
                  (0), the "Losses to be paid by the Insurance company on such
                  Settlement Date" shall be deemed to equal zero (0), and if the
                  amount determined pursuant to Section 7.3(3)(a) is greater
                  than the remaining Aggregate Limit of Indemnity immediately
                  prior to the Settlement Date, the "Losses to be paid by the
                  Insurance company on such Settlement Date" shall be deemed to
                  equal the remaining Aggregate Limit of Indemnity immediately
                  prior to the Settlement Date.

         4.       Calculate the "Actual amounts to be paid to the Insured",
                  which shall equal the amount determined pursuant to Section
                  7.3(3) less Disputed Net Loss less Loss Offset. Such resulting
                  amount shall not be less than zero.

         5.       Determine the amount to be paid into the segregated
                  interest-bearing account, if any, pursuant to Section 8.1(C)
                  which shall be the lesser of:

                  a.       the Disputed Net Loss, and

                  b.       the "Losses to be paid by the Insurance Company on
                           such Settlement Date" minus the Loss Offset.

7.4.     DATE CONVENTION; AMOUNTS

Unless otherwise specified, all quantities or values mentioned in this Section 7
are as of the close of business on the subject Settlement Date.

The use of the phrase "or Premium Payment Date" applies only at the first
Settlement Date.

7.5.     PRECISE YEARS

The Precise Years at the first Settlement Date shall be the actual number of
days elapsed from but not including the Premium Payment Date to and including
three (3) Business Days prior to the first Settlement Date divided by 365.

The Precise Years at each subsequent Settlement Date shall be the actual number
of days elapsed from three (3) Business Days prior to the prior Settlement Date
to three (3) Business Days prior to that Settlement Date divided by the actual
number of days in the year of that Settlement Date.

7.6.     LOSS OFFSET
<PAGE>   11
                                       9

If on any Settlement Date the Reduced Reference Value (as defined below) is less
than the Experience Value, before deducting "Losses to be paid by the Insurance
Company on such Settlement Date", and if the Experience Value is greater than
zero (0), then the Insured shall pay a Loss Offset to the Insurance Company
equal to:

         ((A) minus (B)) multiplied by ((C) divided by (A)), where:

                  (A) is equal to the Experience Value before deducting "Losses
                  to be paid by the Insurance Company on such Settlement Date";

                  (B) is equal to the Reduced Reference Value; and

                  (C) is equal to "Losses to be paid by the Insurance Company on
                  such Settlement Date";

                  provided, however, in no event shall (C) be greater than (A).

7.7.     EXPERIENCE VALUE

The Experience Value shall be a notional value calculated by the Insurance
Company as follows:

         1.       On the Premium Payment Date, the Experience Value shall be One
                  Hundred Ninety-Seven Million Two Hundred Fifty Thousand
                  Dollars ($197,250,000).

         2.       At each Settlement Date, the Experience Value shall equal:

                  The Experience Value at the prior Settlement Date (or Premium
                  Payment Date) multiplied by 1.06 raised to the power of the
                  Precise Years

                  Plus

                  the Insurance Company's Quota Share of any Salvage,
                  subrogation, and other recoveries that are to the benefit of
                  the Insurance Company under this Policy and have been paid to
                  the Insured since the prior Settlement Date or Premium Payment
                  Date

                  Less

                  "Losses to be paid by the Insurance Company on such Settlement
                  Date".

7.8.     REFERENCE VALUE

         (A)      TOTAL REFERENCE VALUE

                  The Total Reference Value at any time shall be equal to the
                  sum of Reference Value A plus Reference Value B.
<PAGE>   12
                                       10

         (B)      ORDER OF LOSS ATTRIBUTION

                  Losses, Loss Offset, salvage, subrogation, and other
                  recoveries and charges shall be attributed to Reference Value
                  A until the Number of Units of Reference Index A shall equal
                  zero (0).

                  Losses, Loss Offset, salvage, subrogation, and other
                  recoveries and charges shall next be attributed to Reference
                  Value B.

         (C)      REDUCED REFERENCE VALUE

                  The Reduced Reference Value shall be equal to the sum of
                  Reduced Reference Value A and Reduced Reference Value B.

         (D)      REFERENCE VALUE A

                  The Reference Value A for a Settlement Date shall be the
                  Number of Units of the Reference Index A deemed held by the
                  Insurance Company multiplied by the Reference Index Unit Value
                  A as of the close of business three (3) Business Days prior to
                  that Settlement Date.

                  (1)      REFERENCE INDEX A

                           Reference Index A at any date shall be equal to the
                           Lehman Brothers Aggregate Bond Index as of the close
                           of business on such date. If the Lehman Brothers
                           Aggregate Bond Index is not available or is no longer
                           in existence, then the following indices will be
                           substituted in order of preference: the Salomon Broad
                           Investment Grade Index, or the Merrill Lynch Domestic
                           Master Index. If both of these indices are not
                           available or are no longer in existence, then the
                           Insured and the Insurance Company shall mutually
                           agree upon an alternative index substantially similar
                           to the foregoing indices.

                  (2)      REFERENCE INDEX UNIT VALUE A

                           At the Premium Payment Date, the Reference Index Unit
                           Value A shall be One Million Dollars ($1,000,000).

                           At three (3) Business Days prior to each Settlement
                           Date, the Reference Index Unit Value A shall be equal
                           to One Million Dollars ($1,000,000) multiplied by the
                           published value of the Reference Index A as of the
                           close of business three (3) Business Days prior to
                           that Settlement Date divided by the Reference Index A
                           at the Premium Payment Date. The published value of
                           Reference Index A at the close of business on the
                           Premium Payment Date was 840.66.

                  (3)      NUMBER OF UNITS OF THE REFERENCE INDEX A
<PAGE>   13
                                       11

                           On the Premium Payment Date, the Number of Units of
                           the Reference Index A deemed held by the Insurance
                           Company shall be equal to One Hundred Five Million
                           Eight Hundred Seventy-Eight Thousand One Hundred
                           Twenty-Five Dollars ($105,878,125) divided by the
                           Reference Index Unit Value A on the close of business
                           that date (which results in 105.878125).

                           On each Settlement Date, the Number of Units of the
                           Reference Index A shall be the Number of Units of the
                           Reduced Reference Index A less (J-K)/L where:

                                    J = "Losses to be paid by the Insurance
                                    Company on that Settlement Date" and charges
                                    that are attributable to Reference Value A;

                                    K = Any Loss Offset, plus the Insurance
                                    Company's Quota Share of any salvage,
                                    subrogation, and other recoveries, that are
                                    attributable to Reference Value A;

                                    L = The Reference Index Unit Value A as of
                                    the close of business three (3) Business
                                    Days prior to that Settlement Date.

                           If the Number of Units of Reference Index A shall
                           ever equal zero (0), it will be zero (0) thereafter.

                  (4)      NUMBER OF UNITS OF THE REDUCED REFERENCE INDEX A

                           The Number of Units of the Reduced Reference Index A
                           at a Settlement Date shall be the Number of Units of
                           Reference Index A deemed held by the Insurance
                           Company at the prior Settlement Date (or Premium
                           Payment Date) multiplied by the difference between
                           the quantity of one and the product of .0016 and the
                           Precise Years.

                           Formula: The Number of Units of the Reduced Reference
                           Index A at a Settlement Date = (Number of Units of
                           Reference Index A at prior Settlement Date (or
                           Premium Payment Date))* (1 - .0016 * Precise Years).

                  (5)      REDUCED REFERENCE VALUE A

                           The Reduced Reference Value A shall be the Number of
                           Units of the Reduced Reference Index A deemed held by
                           the Insurance Company multiplied by the Reference
                           Index Unit Value A.

         (E)      REFERENCE VALUE B
<PAGE>   14
                                       12

                  The Reference Value B for a Settlement Date shall be the
                  Number of Units of the Reference Index B deemed held by the
                  Insurance Company multiplied by the Reference Index Unit Value
                  B as of the close of business three (3) Business Days prior to
                  that Settlement Date.

                  (1)      REFERENCE INDEX B

                           Reference Index B at any date shall be equal to the
                           Standard & Poor's 500 Index (Total Return Basis) as
                           of the close of business on such date. If the
                           Standard & Poor's 500 Index is not available or is no
                           longer in existence, then the following indices will
                           be substituted in order of preference: the Morgan
                           Stanley Capital International Country Index for US,
                           or the Russell 1000 Index. If both of these indices
                           are not available or are no longer in existence, then
                           the Insured and the Insurance Company shall mutually
                           agree upon an alternative index substantially similar
                           to the foregoing indices.

                  (2)      REFERENCE INDEX UNIT VALUE B

                           At the Premium Payment Date, the Reference Index Unit
                           Value B shall be One Million Dollars ($1,000,000).

                           At three (3) Business Days prior to each Settlement
                           Date, the Reference Index Unit Value B shall be equal
                           to One Million Dollars ($1,000,000) multiplied by the
                           published value of the Reference Index B as of the
                           close of business three (3) Business Days prior to
                           that Settlement Date divided by the Reference Index B
                           at the Premium Payment Date. The published value of
                           the Reference Index B at the close of business on the
                           Premium Payment Date was 1670.01.

                  (3)      NUMBER OF UNITS OF THE REFERENCE INDEX B

                           On the Premium Payment Date, the Number of Units of
                           the Reference Index B deemed held by the Insurance
                           Company shall be equal to Ninety Million Nine Hundred
                           Fifty-Four Thousand Five Hundred Dollars
                           ($90,954,500) divided by the Reference Index Unit
                           Value B as of the close of business on that date
                           (which results in 90.9545).

                           On each Settlement Date, the Number of Units of the
                           Reference Index B shall be the Number of Units of the
                           Reduced Reference Index B less (J-K)/L where:

                                    J = "Losses to be paid by the Insurance
                                    Company on that Settlement Date" and charges
                                    that are attributable to Reference Value B;
<PAGE>   15
                                       13

                                    K = Any Loss Offset, plus the Insurance
                                    Company's Quota Share of any salvage,
                                    subrogation, and other recoveries that are
                                    attributable to Reference Value B;

                                    L = The Reference Index Unit Value B as of
                                    the close of business three (3) Business
                                    Days prior to that Settlement Date.

                           If the Number of Units of Reference Index B shall
                           ever equal zero (0), it will be zero (0) thereafter.

                  (4)      NUMBER OF UNITS OF THE REDUCED REFERENCE INDEX B

                           The Number of Units of the Reduced Reference Index B
                           at a Settlement Date shall be the Number of Units of
                           Reference Index B deemed held by the Insurance
                           Company at the prior Settlement Date (or Premium
                           Payment Date) multiplied by the difference between
                           the quantity of one (1) and the product of .0018 and
                           the Precise Years. The Reduction of Notional
                           Investment Income for Notional Income Taxation is
                           then subtracted from this amount.

                                    Formula: The Number of Units of the Reduced
                                    Reference Index B at a Settlement Date =
                                    (Number of Units of Reference Index B at
                                    prior Settlement Date (or Premium Payment
                                    Date)) * (1 - .0018 * Precise Years) -
                                    Reduction of Notional Investment Income for
                                    Notional Income Taxation.

                  (a)      REDUCTION OF NOTIONAL INVESTMENT INCOME FOR NOTIONAL
                           INCOME TAXATION

                           The Reduction of Notional Investment Income for
                           Notional Income Taxation shall be equal to 15% of V
                           multiplied by {(W divided by X) minus (Y divided by
                           Z)}, or 0.15 * V * (W/X - Y/Z)

                           where

                                    V = Number of Units of Reference Index B at
                                    the prior Settlement Date (or on the Premium
                                    Payment Date);

                                    W = Reference Index Unit Value B at the
                                    close of business three (3) Business Days
                                    prior to this Settlement Date;

                                    X = Reference Index Unit Value B at the
                                    close of business three (3) Business Days
                                    prior to the prior Settlement Date (or on
                                    the Premium Payment Date);
<PAGE>   16
                                       14

                                    Y = Value of the Standard & Poor's 500 Index
                                    (not on a total return basis) at the close
                                    of business three (3) Business Days prior to
                                    this settlement date;

                                    Z = Value of the Standard & Poor's 500 Index
                                    (not on a total return basis) at the close
                                    of business three (3) Business Days prior to
                                    the previous Settlement Date (or on the
                                    Premium Payment Date, on which, at the close
                                    of business, the value of the Standard &
                                    Poor's 500 Index was 1229.23).

         (5)      REDUCED REFERENCE VALUE B

                  The Reduced Reference Value B shall be the Number of Units of
                  the Reduced Reference Index B deemed held by the Insurance
                  Company multiplied by the Reference Index Unit Value B.

SECTION 8.        CONDITIONS

8.1.     REPORTING OF AND PAYMENT FOR LOSS

         (A)      Within seventy-five (75) days after the end of each calendar
                  year, the Insured shall furnish the Insurance Company with a
                  written "Loss Report", providing, in a format acceptable to
                  the Insurance Company and the Insured, the Loss paid during
                  that calendar year. Each Loss Report shall provide both the
                  cumulative position from the Policy Inception Date through the
                  end of that calendar year and the changes within that calendar
                  year. The Insured shall also furnish the Insurance Company
                  such other financial data, and in such format, that the
                  Insurance Company may reasonably request for completion of its
                  statutory or other financial statements. The Insured and the
                  Insurance Company agree that, in light of the commonality of
                  interest evidenced by the execution of this Policy, furnishing
                  a Loss Report or other financial data pursuant to this Section
                  8.1 will not be considered a waiver of any attorney-client or
                  attorney-work-product privileges.

         (B)      If the Insurance Company disputes any portion of the amount
                  claimed by the Insured, the Insurance Company shall
                  nevertheless pay to the Insured the undisputed portion of the
                  amount claimed. Any payment pursuant to this Subsection shall
                  not constitute a waiver of the Insurance Company's objections
                  to the disputed portion of the amount claimed.

         (C)      Any disputed amount not paid by the Insurance Company to the
                  Insured at the relevant Settlement Date shall be deemed
                  "Disputed Net Loss." With respect to any Disputed Net Loss,
                  the Insurance Company shall pay on the Settlement Date the
                  Disputed Net Loss into a segregated interest-bearing account
                  at a bank with a net worth of at least One Hundred Million
                  Dollars ($100,000,000). The Insurance Company will provide
                  notice to the Insured on the Settlement Date of the amount
<PAGE>   17
                                       15

                  and circumstances of the Disputed Net Loss and of the details
                  of the segregated account. Withdrawals from the account shall
                  require either the consent of both the Insurance Company and
                  the Insured or a final arbitration award pursuant to Section
                  8.6. Until such withdrawal, however, legal ownership of the
                  account and all cash or other assets held therein shall be in
                  the Insurance Company.

No later than ten (10) days after any agreement between the Insured and the
Insurance Company to settle such disputed amount or a final arbitration award
(to the extent the Insured is successful), the cash and any other assets held in
the account together with the interest income credited thereto net of tax, if
any, thereon at the applicable tax rate on such income shall be immediately paid
to the Insured. To the extent the Insurance Company is successful, then the cash
and any other assets held in the account together with the interest income
credited thereto will be paid to the Insurance Company at the next Settlement
Date, and that amount shall be added into the Reference Value and Experience
Value at such Settlement Date.

8.2.     SETTLEMENT OF NATIONAL CLASS ACTION

         (A)      In the event the Insured is a party to an action asserting
                  Asbestos-Related Claims, which is certified as a "National
                  Class Action" by a court of competent jurisdiction, and the
                  Insured enters into a National Class Action Settlement, the
                  Insured at its sole option may elect either to:

                           (i)      commute the Policy in accordance with
                                    Section 8.3 (notwithstanding the permitted
                                    dates for commutation stated therein); or

                           (ii)     irrevocably forego recovery of such
                                    settlement amount under this Policy.

         (B)      Within ten (10) Business Days after the date upon which the
                  National Class Action Settlement receives final,
                  non-appealable court approval, the Insured shall notify the
                  Insurance Company of its election pursuant to paragraph (A)
                  above.

         (C)      For the purposes of this Section 8.2:

                  "National Class Action" means an action brought by or on
                  behalf of one or more classes of individuals located
                  substantially throughout the Territory who have allegedly
                  sustained or may in the future sustain Bodily Injury from
                  exposure to asbestos.

                  "National Class Action Settlement" means a settlement that
                  fully and finally resolves all then pending and future
                  Asbestos-Related Claims other than "opt-outs" encompassed by a
                  National Class Action.

8.3.     COMMUTATION
<PAGE>   18
                                       16

This Policy may be irrevocably commuted by the Insured, upon not less than
thirty (30) days prior written notice to the Insurance Company, (i) effective
December 31, 2008 or on every fifth (5th) year anniversary of such date
occurring thereafter, or (ii) in the event that the greater of the Total
Reference Value or the Experience Value exceeds the remaining Aggregate Limit of
Indemnity during the calendar year. Within thirty (30) days after the effective
date of the commutation (the "Commutation Date"), the Insurance Company shall
pay to the Insured a commutation payment equal to ninety-eight percent (98%) of
the Total Reference Value, three (3) Business Days prior to the Commutation
Date, and the Insured shall provide to the Insurance Company a full release in
form and substance reasonably satisfactory to the Insurance Company, and the
Insurance Company shall be fully and finally released from any and all liability
and obligations under this Policy.

8.4.     DIRECT ACTIONS

         (A)      "Direct Actions" shall mean all claims or proceedings asserted
                  or initiated against the Insurance Company (whether grounded
                  upon direct action or "reach and apply" statutes, third-party
                  beneficiary or garnishment theories, or otherwise) for the
                  purpose of causing the Insurance Company directly or
                  indirectly, to satisfy claims that have been or could have
                  been asserted against the Insured, which claims or proceedings
                  would not or could not have been asserted against the
                  Insurance Company had the Insurance Company not issued this
                  Policy.

         (B)      The Insured agrees that if the Insurance Company becomes
                  obligated to pay any sums as a result of any judgment entered
                  or compromise reached in a Direct Action, the Insured shall
                  fully indemnify and hold harmless the Insurance Company for
                  any such sums. The sums so indemnified by the Insured,
                  together with the costs of defense paid by the Insured
                  pursuant to Section 8.4(C), shall constitute loss under this
                  Policy, provided, that such sums satisfy the definition of
                  "Loss" herein.

         (C)      The Insured shall control, direct and pay the costs of the
                  defense of any Direct Action including decisions regarding
                  settlement and may elect to appoint the counsel representing
                  the Insured in the Direct Action or in other litigation to
                  defend the Insurance Company in the Direct Action. No position
                  taken by counsel appointed by the Insured to defend the
                  Insurance Company in a Direct Action shall be used or shall be
                  otherwise admissible in any fashion in connection with any
                  dispute between the Insurance Company and the Insured. The
                  Insured shall not take any coverage position on any issue of
                  coverage under this Policy which may be in dispute in such
                  Direct Action without the Insurance Company's prior written
                  input.

         (D)      In the event the Insured does not control, direct and pay the
                  costs of the defense of a Direct Action, the Insurance Company
                  shall direct and control the defense of the Direct Action
                  including decisions regarding settlement. The Insured shall
                  fully indemnify and hold harmless the Insurance Company for
                  any legal fees or other costs paid by the Insurance Company in
                  defense of a Direct Action where the Insured does not control,
                  direct and pay the costs of such defense.
<PAGE>   19
                                       17

8.5.     NON-TRANSFERABILITY

This Policy confers no rights, powers or obligations on any person or
organization other than the Insurance Company and the Insured. Neither this
Policy nor any of the rights, powers, or obligations of the Insurance Company or
the Insured under it may be in any way transferred or assigned to any other
person or organization without express written consent by the Insurance Company
and the Insured. The granting of such consent shall be at the sole and absolute
discretion of each of the parties.

8.6.     ARBITRATION

Except as otherwise agreed upon by the parties in writing:

         (A)      Resolution of Disputes: Any dispute between the Insured and
                  the Insurance Company arising out of or in connection with
                  this Policy or concerning its interpretation or validity or
                  the performance of the parties hereunder, whether arising
                  before or after termination of this Policy, shall be submitted
                  exclusively to arbitration in the manner set forth in this
                  Section 8.6, and the award shall be the exclusive remedy
                  available to a party under this Policy. Either party may
                  initiate arbitration of any such dispute by giving written
                  notice to the other party, by registered or certified mail,
                  return receipt requested, of its intention to arbitrate and of
                  its appointment of an arbitrator in accordance with subsection
                  (C) of this Section 8.6.

         (B)      Composition of Panel: Unless the parties agree upon a single
                  arbitrator within fifteen (15) days after the receipt of a
                  notice of intention to arbitrate, all disputes shall be
                  submitted to an arbitration panel composed of two arbitrators
                  and an umpire, chosen in accordance with subsections (C) and
                  (D) of this Section 8.6.

         (C)      Appointment of Arbitrators: The members of the arbitration
                  panel shall be chosen from disinterested persons having
                  knowledge of and experience in the insurance, reinsurance and
                  financial issues relevant to the matters in dispute. The party
                  requesting arbitration (hereinafter referred to as the
                  "requesting party") shall appoint an arbitrator and give
                  written notice thereof, by registered or certified mail,
                  return receipt requested, to the other party (hereinafter
                  referred to as the "respondent") together with its notice of
                  intention to arbitrate. Unless a single arbitrator is agreed
                  upon within fifteen (15) days after the receipt of the notice
                  of intention to arbitrate, the respondent shall, within thirty
                  (30) days after receiving such notice, also appoint an
                  arbitrator and notify the requesting party thereof in a like
                  manner. Before instituting a hearing, the two arbitrators so
                  appointed shall choose an umpire. If, within twenty (20) days
                  after they are both appointed, the arbitrators fail to agree
                  upon the appointment of an umpire, the umpire shall be
                  appointed by the President of the American Arbitration
                  Association.

         (D)      Failure of Party to Appoint Arbitrator: If the respondent
                  fails to appoint an arbitrator within thirty (30) days after
                  receiving a notice of intention to arbitrate,
<PAGE>   20
                                       18

                  such arbitrator shall be appointed by the President of the
                  American Arbitration Association, and shall then, together
                  with the arbitrator appointed by the requesting party, choose
                  an umpire as provided in subsection (C) of this Section 8.6.

         (E)      Choice of Law and Forum: Any arbitration instituted pursuant
                  to this Section 8.6 shall be held in Wilmington, Delaware. Any
                  action to enforce any arbitration award or to compel
                  arbitration shall be brought only in the state courts of the
                  State of Delaware situated in New Castle County, to the
                  exclusion of all other courts. The substantive laws of the
                  State of Delaware, without regard to its conflict of laws
                  rules, shall govern any action or suit brought to compel any
                  such arbitration or to enforce any award rendered pursuant to
                  such arbitration.

         (F)      Submission of Dispute to Panel: Unless otherwise extended by
                  the arbitration panel, or agreed to by the parties, each party
                  shall submit its case to the panel within thirty (30) days
                  after the selection of an umpire.

         (G)      Procedure Governing Arbitration: All proceedings before the
                  panel shall be informal, and the panel shall not be bound by
                  the formal rules of evidence. The panel shall have the power
                  to fix all procedural rules relating to the arbitration
                  proceeding. In reaching any decision, the panel shall give due
                  consideration to the customs and usage of the insurance,
                  reinsurance and finance business.

         (H)      Arbitration Award: The arbitration panel shall render its
                  decision within sixty (60) days after conclusion of the
                  hearing, which decision shall be in writing, stating the
                  reasons therefor. The decision of the majority of the panel
                  shall be final and binding on the parties to the proceeding.
                  Judgment on the award may be entered in any court of competent
                  jurisdiction, and execution of any monetary judgment may occur
                  in any jurisdiction.

         (I)      Cost of Arbitration: Unless otherwise allocated by the
                  arbitration panel, each party shall bear the expense of its
                  own arbitrator and its own witnesses and shall jointly and
                  equally bear with the other parties the expense of the umpire
                  and the arbitration.

         (J)      Limit of Power of Arbitration Panel: The arbitration panel
                  does not have the power to award punitive, multiplied, or
                  exemplary damages, other similar damages or any extra
                  contractual damages of any nature or description whatsoever,
                  except to the extent claimed as a Loss under this Policy, and
                  the Insured and the Insurance Company expressly waive all
                  rights to punitive, multiplied, or exemplary damages, other
                  similar damages or any extra contractual damages of any nature
                  or description whatsoever, except to the extent claimed as
                  Loss under this Policy.

8.7.     OTHER INSURANCE

The obligation of the Insurance Company to pay Loss under this Policy is in
excess of the limits of liability under all of the Scheduled Underlying Policies
which are applicable to Asbestos-Related
<PAGE>   21
                                       19

Claims. To the extent that the insurer identified on such Scheduled Underlying
Policies refuses or fails to pay any amounts thereunder with respect to
Asbestos-Related Claims, the Insurance Company shall pay such amounts to the
extent such amounts constitute Loss hereunder, and shall thereafter be
subrogated to the Insured's rights against the non-paying insurers to the extent
of any and all such payments by the Insurance Company.

8.8.     AMENDMENT

This Policy may be amended only by mutual consent of the parties expressed in a
written endorsement executed by the parties with the same formalities as this
Policy, and such addendum shall be deemed to be an integral part of this Policy
and binding on the parties hereto.

8.9.     CONFIDENTIALITY

Any information that is not independently available from a non-confidential
source and is disclosed to the Insurance Company or its representatives in
connection with this Policy shall be treated as confidential by the Insurance
Company until any such information becomes independently available in
substantially similar form from a non-confidential source (all such information
referred to herein as "Confidential Information"). The Insurance Company shall
use its best efforts to preserve and protect the confidentiality of, and where
applicable, the privilege pertaining to, all Confidential Information. Unless
the Insured gives prior written consent or unless compelled by the law to
disclose such information, the Insurance Company may not disclose Confidential
Information to any person other than the legal representatives, accountants,
rating agencies or advisors of the Insurance Company or its affiliates, or the
co-insurers of this Policy and their respective legal representatives,
accountants or advisors (each, an "Authorized Third Party"), or tax and
regulatory authorities, and neither the Company nor any Authorized Person may
use Confidential Information for any purpose except in connection with the
exercise of its rights and obligations under this Policy or the rights and
obligations of the Insurance Company's reinsurers or retrocessionaires with
respect to this Policy. If the Insurance Company discloses any Confidential
Information to any Authorized Third Party, other than legal representatives, the
Insurance Company shall make reasonable efforts to minimize the amount of
information disclosed, taking into consideration the reason for the disclosure,
including where feasible marking all files containing Confidential Information
provided to tax and regulatory authorities as "Confidential". The Insurance
Company shall obtain from any such Authorized Third Party a written agreement
substantially similar to the provisions of this Section 8.9, to maintain the
confidentiality of all Confidential Information. The Insurance Company shall be
responsible for disclosure of Confidential Information by any Authorized Third
Party in violation of this Section 8.9. In the event the Insurance Company is
served with a subpoena or court order compelling disclosure by the Insurance
Company of Confidential Information, the Insurance Company shall give written
notice thereof to the Insured as soon as reasonably practicable. The Insured
may, at its sole option and expense, seek a protective order or otherwise
legally resist such attempts to compel disclosure. The Insurance Company shall
reasonably cooperate with the Insured during the process of seeking such
protective order or otherwise legally resisting such attempts to compel
disclosure.

8.10.    NOTICE
<PAGE>   22
                                       20

         (A)      Any notice or other information required or authorized by this
                  Policy to be given by either party to the other may be given
                  by delivery by hand or by sending it by prepaid certified or
                  registered mail (or equivalent air mail, if international), or
                  by facsimile transmission, as set forth under Item 5 in the
                  Declarations.

         (B)      Either party may change the address for service referred to in
                  Subsection (A) above by sending notice to the other party in
                  the manner provided for by this Section to the last address
                  notified for the purpose of this Section by the other party.

8.11.    CAPTIONS AND CATCHLINES

Captions and catchlines used in this Policy are intended solely as aids to
convenient reference. They shall not be considered part of this Policy nor limit
or otherwise affect its meaning, and no inference as to the meaning or intent of
any provision of this Policy may be drawn from them.

8.12.    RIGHT OF OFFSET

Both the Insured and the Insurance Company shall have, and may exercise, at any
time the right to offset any balance or balances due the other under this
Policy. Except as otherwise agreed by the parties and to the extent provided
for, such offset may only include balances due under this Policy, regardless of
whether such balances are in respect of premiums, or Loss or otherwise, and
regardless of the capacity of any party, under the various agreements involved.

8.13.    SALVAGE, SUBROGATION AND OTHER RECOVERIES

In the event of the payment of any indemnity by the Insurance Company under this
Policy, the Insurance Company shall be subrogated, to the extent of such
payment, to all of the rights of the Insured against any person or entity
legally responsible in damages for the Loss paid by the Insured. The Insurance
Company agrees, upon the Insured's request, to assign such subrogation rights to
the Insured. In the event the Insured enforces such rights, any recovery
effected by the Insured shall serve to reduce Loss under the Policy, after
deducting the costs of such recovery.

8.14.    CHOICE OF LAW

All disputes arising under this Policy shall be governed by and construed in
accordance with the substantive laws of the State of Delaware, without giving
effect to its conflicts of laws principles.

8.15.    NO WAIVER

No consent or waiver, express or implied, by any other party to or of any breach
or default by any other party in the performance of its obligations hereunder
shall be construed to be a consent or waiver to or of any other breach or
default in the performance of obligations by such other party hereunder. Failure
on the part of any party to complain of any act or failure to act of any other
party or to declare any other party in default, irrespective of how long such
failure continues, shall not constitute a waiver by such first party of its
rights hereunder.
<PAGE>   23
                                       21

8.16.    CONSTRUCTION

It is understood and agreed that this Policy is a manuscript policy that has
been negotiated at arm's length and on equal footing as between the Insured and
Insurance Company, and that both parties fully understood and agreed to all the
terms and conditions contained in this Policy. Accordingly, in any dispute
concerning the meaning of this Policy, or any term or condition hereof, such
dispute shall be resolved without reference to the doctrine of contra
proferentem or any related or similar doctrine.

8.17.    REPRESENTATION OF INSURED

The Insured has reviewed the terms, conditions, and significance of this Policy
with the legal and tax counsel and the accountants of its choice, and is
accepting this Policy with full knowledge of its terms, conditions and
significance. In accepting this Policy, the Insured is not relying upon any
representation or warranty by the Insurance Company regarding the legal,
regulatory, tax or accounting implications of this Policy for the Insured or the
suitability (or lack thereof) of this Policy for the Insured.

8.18.    COUNTERPARTS

This Policy may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.

8.19.    CURRENCY

All payments and amounts under this Policy shall be in United States Dollars.

8.20.    TERMS OF POLICY CONFORMED TO STATUTE.

If any of the terms or conditions of this Policy are found to be in conflict
with the local laws or statutes of the State wherein this Policy is issued, the
Policy will be amended by the agreement of both parties hereto so as to conform
with such law or statute. If the parties cannot agree to the changes to be made,
any dispute will be settled in accordance with Section 8.6 of this Policy.

8.21.    TAXATION OF FOREIGN PERSONS.

(A)      In the event that, due to a change in United States law, the rate of
         tax applicable to dividends paid by a United States corporation to a
         Swiss person that is eligible for the benefits of the tax treaty
         currently in effect between the United States and the Confederation of
         Switzerland is increased above, or decreased below, fifteen percent
         (15%), the Reduction of Notional Investment Income for Notional
         Taxation, as defined in this Policy, shall be determined by
         substituting the rate of tax applicable to Swiss holders who own any
         amount of equity of the dividend payer without any minimum level of
         investment for fifteen percent (15%).

(B)      In the event that gains, interest or any other applicable form of
         investment income recognized by non-United States owners of assets held
         in the United States become
<PAGE>   24
                                       22

         subject to United States income taxation, either by a change in the
         rules regarding the definition of the character or source of income or
         otherwise, the parties shall agree to appropriate modifications of the
         terms of this Policy.

(C)      For purposes of this Section, a change in United States law shall
         include (i) a change in the Internal Revenue Code and the Income Tax
         Regulations promulgated thereunder and (ii) any amendment, cancellation
         or termination of the tax treaty currently in effect between the United
         States and the Confederation of Switzerland.

8.22.    PREMIUM TAXES

The Insured agrees that it shall pay any additional applicable State tax and any
other related assessments with respect to any additional premium due under this
Policy.

8.23.    DATES AND TIMES

All dates and times contained in this Policy, unless otherwise specified, are
New York, New York time.
<PAGE>   25
                                       23

IN WITNESS WHEREOF, the parties hereto have caused this Policy to be executed by
their duly authorized representatives, effective as of the 31st day of December,
1998.

                                     METROPOLITAN LIFE INSURANCE
                                     COMPANY

                                     BY: __________________________________

                                     Name: ________________________________

                                     Title: _______________________________

                                     STOCKWOOD REINSURANCE COMPANY, LTD.

                                     BY: __________________________________

                                     Name: ________________________________

                                     Title: _______________________________
<PAGE>   26
                                   SCHEDULE A
                          SCHEDULED UNDERLYING POLICIES

                                       A-1
<PAGE>   27
                                   SCHEDULE B
                                SETTLED POLICIES

                                      B-1
<PAGE>   28
                    ENDORSEMENT NO. 1 TO POLICY NO. 04-03-22,

         A RESTATEMENT OF THE EXCESS ASBESTOS INDEMNITY INSURANCE POLICY

                  ISSUED TO METROPOLITAN LIFE INSURANCE COMPANY

                                       BY

                       STOCKWOOD REINSURANCE COMPANY LTD.

This Endorsement is attached to and forms a part of Policy No. 04-03-22 (the
"Policy"), issued to Metropolitan Life Insurance Company (the "Insured") by
Stockwood Reinsurance Company Ltd. (the "Insurance Company") and effective as of
December 31, 1998.

For value received, the parties hereby agree that, effective from the inception
of the Policy:

1.       On page 3 of the Policy, Section 2(P)(ii)(c) is hereby amended to read
         in its entirety as follows:

         proof of exposure to asbestos or asbestos containing products (by way
         of interrogatory answer, affidavit (which may be included within the
         release), personnel record, work history sheet or other evidence of
         exposure).

2.       On page 3 of the Policy, Section 2(P)(iv) is hereby amended to read in
         its entirety as follows:

         in settling Asbestos-Related Claims for which the documentation set
         forth in Sections (P)(ii)(a) through (c) above has not all been
         obtained; provided, however, that the cumulative amount of such
         payments included in Loss shall be no greater than 5% of the cumulative
         amount of Insured Payments made subsequent to the Policy Inception Date
         in settling Asbestos-Related Claims for which such documentation has
         been obtained.

3.       On page 5 of the Policy, Section 3.2., entitled "Annual Sublimit", is
         hereby amended to read in its entirety as follows:

         Subject to the Aggregate Limit of Indemnity described in Section 3.1
         above, the maximum amount payable by the Insurance Company at any
         Settlement Date for all Loss in the calendar year immediately prior to
         such Settlement Date ("calendar year(x)"), during the Period of
         Indemnification in respect of Loss under this Policy shall not exceed
         the Insurance Company's Quota Share of the Annual Sublimit for calendar
         year(x). The Annual Sublimit shall be calculated by the Insurance
         Company for calendar year(x) and shall be equal to:

         (1)      the Per Claimant Average Amount for calendar year(x)
                  multiplied by

         (2)      the "Number of Individual Asbestos-Related Claims" for
                  calendar year(x).

         A claimant shall be included in the calculation of the "Number of
         Individual Asbestos-Related Claims" for calendar year(x) when Loss is
         paid to that claimant pursuant to the
<PAGE>   29
         criteria in Sections 2(P)(ii), (iii) and (iv); provided, however, that
         members of the same family without their own independent
         asbestos-related injury due to their own exposure to asbestos shall all
         be treated for purposes of this Policy as a single Asbestos-Related
         Claim with the primary claim notwithstanding the fact that all such
         individuals may have provided separate releases.

         The "Number of Individual Asbestos-Related Claims" for purposes of the
         calculation in the previous paragraph shall be determined by treating
         claims by each individual qualifying claimant as a separate
         Asbestos-Related Claim regardless of whether claims by such claimant
         are part of a group or bulk settlement.

4.       On page 6 of the Policy, Section 4, entitled "Retention", is hereby
         amended to read in its entirety as follows:

         The Retention to be borne by the Insured under this Policy shall equal
         in the aggregate Four Hundred Million Dollars ($400,000,000) plus all
         Loss paid by the Insured on or after the Policy Inception Date and
         prior to the Premium Payment Date.

5.       On page 8 of the Policy, Section 7.3.3. is hereby amended to read in
         its entirety as follows:

         Calculate the "Losses to be paid by the Insurance Company on such
         Settlement Date", which shall equal: (a) the Insurance Company's Quota
         Share of the quantity arrived at by subtracting any remaining Retention
         from the amount determined pursuant to Section 7.3(2); except that (b)
         if the amount determined pursuant to Section 7.3(3)(a) is less than
         zero (0), the "Losses to be paid by the Insurance Company on such
         Settlement Date" shall be deemed to equal zero (0), and if the amount
         determined pursuant to Section 7.3(3)(a) is greater than the remaining
         Aggregate Limit of Indemnity immediately prior to the Settlement Date,
         the "Losses to be paid by the Insurance Company on such Settlement
         Date" shall be deemed to equal the remaining Aggregate Limit of
         Indemnity immediately prior to the Settlement Date.

All parties agree and covenant that this Endorsement shall and does take
precedence over the Policy to the extent that the terms and conditions set forth
in this Endorsement modify the terms and conditions of the Policy. The
undersigned further agree that this Endorsement shall not be altered or modified
while the Policy is in force without the express written consent of all parties.
The undersigned agree and warrant that this Endorsement is a valid and binding
contract which they have the right to make and that the persons signing for them
below are authorized to sign this Endorsement.
<PAGE>   30
AGREED, as of this                   day of June, 1999.

METROPOLITAN LIFE INSURANCE COMPANY

BY:

NAME:

TITLE:

STOCKWOOD REINSURANCE COMPANY LTD.

BY:

NAME:

TITLE:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00003-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00003-of-00352.parquet"}]]