Document:

EXECUTION COPY

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

                                 $5,700,000,000

                             COMPETITIVE ADVANCE AND
                       REVOLVING CREDIT FACILITY AGREEMENT

                          Dated as of October 27, 2000

                                      among

                         CITIZENS COMMUNICATIONS COMPANY
                                   as Borrower

                                       and

                            THE LENDERS NAMED HEREIN
                                   as Lenders

                                       and

                            THE CHASE MANHATTAN BANK
                             as Administrative Agent

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

                              CHASE SECURITIES INC.
                       Lead Arranger and Sole Book Manager

                              BANK OF AMERICA, N.A.
                                 CITIBANK, N.A.
                                  BANK ONE, NA
                              Co-Syndication Agents

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                                                                Page

                                                            Article I
                                                           DEFINITIONS

<S>                                                                                                             <C>
Section 1.01. Defined Terms.......................................................................................4
Section 1.02. Terms Generally....................................................................................15

                                                            Article II
                                                           THE CREDITS

Section 2.01. Commitments........................................................................................16
Section 2.02. Loans..............................................................................................16
Section 2.03. Competitive Bid Procedure..........................................................................17
Section 2.04. Standby Borrowing Procedure........................................................................20
Section 2.05. Conversions........................................................................................20
Section 2.06. Fees...............................................................................................21
Section 2.07. Repayment of Loans.................................................................................21
Section 2.08. Interest on Loans..................................................................................22
Section 2.09. Default Interest...................................................................................23
Section 2.10. Alternate Rate of Interest.........................................................................23
Section 2.11. Changes in Commitments.............................................................................24
Section 2.12. Prepayment.........................................................................................25
Section 2.13. Reserve Requirements; Change in Circumstances......................................................26
Section 2.14. Change in Legality.................................................................................28
Section 2.15. Indemnity..........................................................................................29
Section 2.16. Pro Rata Treatment.................................................................................29
Section 2.17. Sharing of Setoffs.................................................................................30
Section 2.18. Payments...........................................................................................30
Section 2.19. Taxes..............................................................................................31

                                                         Article III
                                                REPRESENTATIONS AND WARRANTIES

Section 3.01. Organization; Powers; Governmental Approvals.......................................................33
Section 3.02. Financial Statements...............................................................................34
Section 3.03. No Material Adverse Change.........................................................................34
Section 3.04. Title to Properties; Possession Under Leases.......................................................34
Section 3.05. Ownership of Subsidiaries..........................................................................34
Section 3.06. Litigation; Compliance with Laws...................................................................35
Section 3.07. Agreements.........................................................................................35
Section 3.08. Federal Reserve Regulations........................................................................36
Section 3.09. Investment Company Act; Public Utility Holding Company Act.........................................36
Section 3.10. Use of Proceeds....................................................................................36
Section 3.11. Tax Returns........................................................................................36
<PAGE>

Section 3.12. No Material Misstatements..........................................................................36
Section 3.13. Employee Benefit Plans.............................................................................36
Section 3.14. Insurance..........................................................................................37
Section 3.15. Acquisitions.......................................................................................37

                                                          Article IV
                                                    CONDITIONS OF LENDING

Section 4.01. Each Borrowing.....................................................................................38
Section 4.02. Effective Date.....................................................................................39

                                                          Article V
                                                    AFFIRMATIVE COVENANTS

Section 5.01. Existence; Businesses and Properties...............................................................40
Section 5.02. Financial Statements, Reports, etc.................................................................41
Section 5.03. Litigation and Other Notices.......................................................................42
Section 5.04. Maintaining Records................................................................................42
Section 5.05. Use of Proceeds....................................................................................43

                                                          Article VI
                                                      NEGATIVE COVENANTS

Section 6.01. Liens..............................................................................................43
Section 6.02. Ownership of the Principal Subsidiaries............................................................43
Section 6.03. Asset Sales........................................................................................44
Section 6.04. Mergers............................................................................................44
Section 6.05. Restrictions on Dividends..........................................................................44
Section 6.06. Transactions with Affiliates.......................................................................44
Section 6.07. Minimum Consolidated Net Worth.....................................................................45

                                                         Article VII
                                                      EVENTS OF DEFAULT

                                                         Article VIII
                                                   THE ADMINISTRATIVE AGENT

                                                          Article IX
                                                        MISCELLANEOUS

Section 9.01. Notices............................................................................................49
Section 9.02. Survival of Agreement..............................................................................50
Section 9.03. Binding Effect.....................................................................................50
Section 9.04. Successors and Assigns.............................................................................50
Section 9.05. Expenses; Indemnity................................................................................53
Section 9.06. Right of Setoff....................................................................................54
Section 9.07. Applicable Law.....................................................................................54
Section 9.08. Waivers; Amendment.................................................................................54
Section 9.09. Interest Rate Limitation...........................................................................55
<PAGE>

Section 9.10. Entire Agreement...................................................................................55
Section 9.11. Waiver of Jury Trial...............................................................................55
Section 9.12. Severability.......................................................................................56
Section 9.13. Counterparts.......................................................................................56
Section 9.14. Headings...........................................................................................56
Section 9.15. Jurisdiction; Consent to Service of Process........................................................56

Exhibit A-1              Form of Competitive Bid Request
Exhibit A-2              Form of Notice of Competitive Bid Request
Exhibit A-3              Form of Competitive Bid
Exhibit A-4              Form of Competitive Bid Accept/Reject Letter
Exhibit A-5              Form of Standby Borrowing Request
Exhibit A-6              Form of Conversion Request
Exhibit B                Form of Administrative Questionnaire
Exhibit C                Form of Assignment and Acceptance
Exhibit D                Form of Opinion of Counsel to Borrower
Exhibit E-1              Form of Standby Note
Exhibit E-2              Form of Competitive Note

Schedule 2.01            Lenders' Commitments and Addresses

</TABLE>
<PAGE>

     COMPETITIVE  ADVANCE AND REVOLVING CREDIT FACILITY  AGREEMENT,  dated as of
     October 27,   2000,  among  CITIZENS  COMMUNICATIONS  COMPANY,  a  Delaware
     corporation (the "Borrower"), the Lenders listed in Schedule 2.01 (together
     with any assignees  pursuant to  Section 9.04(b),  the  "Lenders")  and THE
     CHASE MANHATTAN  BANK, a New York banking  corporation,  as  administrative
     agent for the Lenders (in such capacity, the "Administrative Agent").

     The Borrower has  requested the Lenders to extend credit to the Borrower in
order to enable it to borrow on a standby  revolving  credit  basis on and after
the date  hereof  and at any time and from time to time  prior to the  Revolving
Period Maturity Date (as hereinafter  defined) a principal  amount not in excess
of  $5,700,000,000  (as such  amount may be modified  pursuant  to  Section 2.11
hereof) at any time  outstanding,  all or a portion of which may be converted to
one-year term loans on the Revolving Period Maturity Date. The Borrower has also
requested the Lenders to provide a procedure  pursuant to which the Borrower may
invite the Lenders to bid on an  uncommitted  basis on short-term  borrowings by
the  Borrower.  The  proceeds  of such  borrowings  are to be  used to  backstop
commercial paper issued to finance the Acquisitions (as hereinafter defined), to
pay reasonable and customary fees,  expenses and  transaction  costs incurred by
the Borrower in connection with the Acquisitions and for other general corporate
purposes,  including other acquisitions.  The Lenders are willing to extend such
credit to the  Borrower  on the terms and subject to the  conditions  herein set
forth.

     Accordingly,  the Borrower,  the Lenders and the Administrative Agent agree
as follows:

                                   Article I

                                   DEFINITIONS

     Section 1.01. Defined Terms.

     As used in this  Agreement,  the  following  terms shall have the  meanings
specified below:

     "ABR Borrowing" shall mean a Borrowing comprised of ABR Loans.

     "ABR  Loan"  shall  mean  any  Standby  Loan  bearing  interest  at a  rate
determined  by  reference  to the  Alternate  Base Rate in  accordance  with the
provisions of Article II.

     "Acquisitions"  shall mean (x) the acquisition by the Borrower of telephone
access lines from Verizon Communications and certain of its affiliates and Qwest
Communications International,  Inc. pursuant to (i) nine separate Agreements for
Purchase  and Sale of  Telephone  Exchanges,  each  dated  as of June 16,  1999,
between the Borrower and Qwest Communications International, Inc., (ii) an Asset
Purchase   Agreement,   dated  as  of  May  27,  1999,  between  GTE  California
Incorporated and the Borrower,  (iii) an Asset Purchase  Agreement,  dated as of
May 27, 1999,  between GTE West Coast  Incorporated and the Borrower and (iv) an
Asset Purchase Agreement, dated as of May 27, 1999, between Contel of Minnesota,
Inc. and the  Borrower,  and (y) the  acquisition  by the  Borrower  from Global
Crossing Ltd. of the Frontier local  exchange  carrier  business,  consisting of
approximately 1.1 million access lines,  pursuant to a Stock Purchase Agreement,
dated as of July 11, 2000,  among Global  Crossing Ltd.,  Global  Crossing North
America Inc. and the Borrower.

                                       4
<PAGE>

     "Administrative  Fees"  shall  have the  meaning  assigned  to such term in
Section 2.06(b).

     "Administrative  Questionnaire" shall mean an Administrative  Questionnaire
in the form of Exhibit B hereto.

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

     "Alternate  Base Rate" shall mean,  for any day, a rate per annum  (rounded
upwards,  if necessary,  to the next 1/16 of 1%) equal to the greater of (i) the
Prime Rate in effect on such day and (ii) the  Federal Funds  Effective  Rate in
effect  on such day plus  1/2 of 1%.  If the  Administrative  Agent  shall  have
determined (which  determination shall be conclusive absent manifest error) that
it is unable to  ascertain  the  Federal  Funds  Effective  Rate for any reason,
including  the  inability  of the  Administrative  Agent  to  obtain  sufficient
quotations,  the  Alternate  Base Rate  shall be  determined  without  regard to
clause (ii) of the first  sentence of this  definition  until the  circumstances
giving rise to such inability no longer exist.  Any change in the Alternate Base
Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall
be  effective  on the  effective  date of such  change in the Prime  Rate or the
Federal Funds Effective Rate, respectively.

     "Applicable Rate" shall mean 0.000% with respect to any ABR Loan, and shall
mean,  with respect to any Eurodollar  Standby Loan or Facility Fee, as the case
may be, at all times during which any "Applicable  Rating Level" set forth below
is in effect,  the rate per annum set forth below under the appropriate  caption
next to such Applicable Rating Level:
<TABLE>
<CAPTION>

<S>                      <C>                      <C>                    <C>                    <C>
========================= ======================== ====================== ====================== ======================
       Applicable                S&P                   Applicable Rate        Applicable Rate          Utilization
         Rating             Rating/Moody's             for Eurodollar               for                   Margin
         Level                 Rating                  Standby Loans            Facility Fee
========================= ======================== ====================== ====================== ======================
           I              AA-or higher/Aa3 or             0.200%                 0.050%                 0.100%
                          higher
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
           II             A+/A1                           0.240%                 0.060%                 0.100%
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
          III             A/A2                            0.240%                 0.060%                 0.100%
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
           IV             A-/A3                           0.330%                 0.070%                 0.100%
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
           V              BBB+/Baa1                       0.400%                 0.100%                 0.100%
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
           VI             BBB/Baa2                        0.625%                 0.125%                 0.100%
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
          VII             BBB-/Baa3                       0.725%                 0.150%                 0.125%
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
          VIII            lower than BBB-/lower           0.800%                 0.200%                 0.125%
                          than Baa3
------------------------- ------------------------ ---------------------- ---------------------- ----------------------
</TABLE>

                                       5
<PAGE>

provided,  that the Applicable  Rate for Eurodollar  Standby Loans and ABR Loans
shall be  increased  by the rate per  annum set forth  above  under the  caption
"Utilization  Margin" that  corresponds to the  Applicable  Rating Level used to
determine such Applicable Rates at all times following the  effectiveness of the
Term Election or at any time during a Utilization Period.

     For  purposes  of the  foregoing,  the  Applicable  Rating  Level  shall be
determined  in  accordance  with the then  applicable  S&P  Rating  and the then
applicable  Moody's  Rating.  In the event that the S&P  Rating and the  Moody's
Rating do not correspond to the same Applicable Rating Level, then the higher of
the two ratings shall determine the Applicable Rating Level; provided,  however,
that if there is a  difference  of two or more  levels  between  the  Applicable
Rating Level  corresponding  to the S&P Rating and the  Applicable  Rating Level
corresponding  to the Moody's Rating,  then the Applicable  Rating Level that is
one level above the Applicable  Rating Level  corresponding  to the lower of the
S&P Rating and the Moody's  Rating shall apply.  In the event that no S&P Rating
or no  Moody's  Rating  shall  be  in  effect  (other  than  by  reason  of  the
circumstances  referred to in the last  sentence of this  definition),  then the
Applicable  Rating Level shall be Applicable Rating  Level VIII.  The Applicable
Rating Level shall be  redetermined  on the date of  announcement of a change in
the S&P Rating or the Moody's Rating.  A change in the Applicable Rate resulting
from a change in the  Applicable  Rating  Level shall  become  effective on such
date. If the rating  system of S&P or Moody's  shall  change,  or if either such
Person shall cease to be in the business of rating  corporate debt  obligations,
the  Borrower  and the  Lenders  shall  negotiate  in good  faith to amend  this
definition  to reflect  such  changed  rating  system or the  unavailability  of
ratings from such Person and,  pending the  effectiveness of any such amendment,
the Applicable Rate shall be determined by reference to the rating most recently
in effect prior to such change or cessation.

     "Assignment and Acceptance" shall mean an assignment and acceptance entered
into by a Lender and an assignee,  and accepted by the Administrative  Agent, in
substantially the form of Exhibit C.

     "Board" shall mean the Board of Governors of the Federal  Reserve System of
the United States.

     "Borrowing"  shall  mean a group  of Loans  of a  single  Type  made by the
Lenders (or, in the case of a  Competitive  Borrowing,  by the Lender or Lenders
whose Competitive Bids have been accepted pursuant to Section 2.03) or Converted
on a single  date and as to which a single  Interest  Period is in  effect.  All
Loans of the same Type, having the same Interest Period and made or Converted on
the same day shall be deemed a single  Borrowing  hereunder until repaid or next
Converted.

     "Business  Day" shall mean any day (other  than a day which is a  Saturday,
Sunday or legal  holiday  in the State of New York) on which  banks are open for
business in New York City; provided, however, that, when used in connection with
a Eurodollar  Loan,  the term "Business Day" shall also exclude any day on which
banks are not open for  dealings  in dollar  deposits  in the  London  interbank
market.

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

                                       6
<PAGE>

     A "Change in Control" shall be deemed to have occurred if (a) any Person or
group  (within  the  meaning  of  Rule 13d-5  of  the  Securities  and  Exchange
Commission  as in effect on the date hereof)  shall own directly or  indirectly,
beneficially or of record,  shares  representing  more than 49% of the aggregate
ordinary voting power represented by the issued and outstanding capital stock of
the  Borrower;  or (b) a  majority of the seats (other than vacant seats) on the
board of  directors  of the  Borrower  shall at any time have been  occupied  by
Persons who were neither  (i) nominated  by the management of the Borrower,  nor
(ii) appointed  by  directors  so  nominated;  or (c) any  Person or group shall
otherwise directly or indirectly Control the Borrower.

     "Code"  shall mean the Internal  Revenue  Code of 1986,  as the same may be
amended from time to time.

     "Commitment"  shall mean,  with respect to each Lender,  the  commitment of
such Lender  hereunder as set forth in  Schedule 2.01  hereto,  as such Lender's
Commitment  may be  modified  from  time to time  pursuant  to  Section 2.11  or
Section 2.13(f).  Unless  earlier  terminated  pursuant  to the  terms  of  this
Agreement,  the Commitments shall automatically and permanently terminate on the
Revolving Period Maturity Date.

     "Competitive  Bid"  shall  mean an offer by a Lender to make a  Competitive
Loan pursuant to Section 2.03.

     "Competitive Bid  Accept/Reject  Letter" shall mean a notification  made by
the Borrower pursuant to Section 2.03(d) in the form of Exhibit A-4.

     "Competitive  Bid Rate" shall  mean,  as to any  Competitive  Bid made by a
Lender pursuant to  Section 2.03(b),  (i) in the case of a Eurodollar  Loan, the
Margin,  and (ii) in  the case of a Fixed Rate Loan,  the fixed rate of interest
offered by the Lender making such Competitive Bid.

     "Competitive   Bid  Request"   shall  mean  a  request  made   pursuant  to
Section 2.03 in the form of Exhibit A-1.

     "Competitive  Borrowing" shall mean a Borrowing consisting of a Competitive
Loan  or  concurrent   Competitive  Loans  from  the  Lender  or  Lenders  whose
Competitive Bids for such Borrowing have been accepted by the Borrower under the
bidding procedure described in Section 2.03.

     "Competitive Loan" shall mean a Loan from a Lender to the Borrower pursuant
to the bidding procedure described in Section 2.03.  Each Competitive Loan shall
be a Eurodollar Competitive Loan or a Fixed Rate Loan.

     "Consolidated Net Worth" shall mean, as at any date of  determination,  the
consolidated   stockholders'   equity  of  the  Borrower  and  its  consolidated
Subsidiaries,  including  redeemable  preferred  securities where the redemption
date occurs  after the  Termination  Date,  mandatorily  redeemable  convertible
preferred  securities  and  minority  equity  interests  in  other  persons,  as
determined on a consolidated basis in conformity with GAAP consistently applied.

                                       7
<PAGE>

     "Consolidated  Tangible  Assets" of any Person  shall mean total  assets of
such Person and its  consolidated  Subsidiaries,  determined  on a  consolidated
basis,  less  goodwill,  patents,  trademarks  and other  assets  classified  as
intangible assets in accordance with GAAP.

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

     "Conversion",  "Convert" or  "Converted"  shall mean the  conversion of any
Standby Loan of one Type into a Standby Loan of another  Type,  or the selection
of a new, or the renewal of the same, Interest Period for any such Standby Loan,
as the case may be, pursuant to Section 2.05.

     "Conversion  Request" shall mean a request made pursuant to Section 2.05 in
the form of Exhibit A-6.

     "Default"  shall mean any event or condition  which upon  notice,  lapse of
time, or both would constitute an Event of Default.

     "Dollars" or "$" shall mean lawful money of the United States of America.

     "Effective  Date" shall mean the date on which the conditions  specified in
Section 4.02 are satisfied (or waived in accordance with Section 9.08).

     "Environmental Laws" shall mean all national,  federal, state,  provincial,
municipal  or local laws,  statutes,  ordinances,  orders,  judgments,  decrees,
injunctions,   writs,  policies  and  guidelines  (having  the  force  of  law),
directives,  approvals, notices, rules and regulations and other applicable laws
relating to environmental or occupational  health and safety matters,  including
those relating to the Release or threatened Release of Specified  Substances and
to the generation,  use, storage or transportation of Specified Substances, each
as in effect as of the date of determination.

     "ERISA" shall mean the Employee  Retirement Income Security Act of 1974, as
the same may be amended from time to time, and the  regulations  promulgated and
the rulings issued thereunder.

     "ERISA  Affiliate"  shall  mean  each  trade or  business  (whether  or not
incorporated)  which  together with the Borrower or a Subsidiary of the Borrower
would  be  deemed  to  be  a   "single   employer"   within   the   meaning   of
Section 4001(b)(1) of ERISA.

                                       8
<PAGE>

     "ERISA  Termination Event" shall mean (i) a "Reportable Event" described in
Section 4043  of ERISA  (other  than a  "Reportable  Event"  not  subject to the
provision  for 30-day  notice to the PBGC under such  regulations),  or (ii) the
withdrawal of the Borrower or any of its ERISA  Affiliates  from a Plan during a
plan  year  in  which  it  was  a   "substantial   employer"   as   defined   in
Section 4001(a)(2)  of  ERISA,  or  (iii) the  filing  of a notice  of intent to
terminate a Plan or the  treatment of a Plan  amendment as a  termination  under
Section 4041 of ERISA, or (iv) the institution of proceeding to terminate a Plan
by the PBGC or (v) any other event or condition which might  constitute  grounds
under  Section 4042  of ERISA for the  termination  of, or the  appointment of a
trustee to administer, any Plan.

     "Eurodollar  Borrowing"  shall mean a  Borrowing  comprised  of  Eurodollar
Loans.

     "Eurodollar  Competitive  Borrowing"  shall mean a Borrowing  comprised  of
Eurodollar Competitive Loans.

     "Eurodollar  Competitive  Loan"  shall mean any  Competitive  Loan  bearing
interest at a rate  determined by reference to the LIBO Rate in accordance  with
the provisions of Article II.

     "Eurodollar Loan" shall mean any Eurodollar  Competitive Loan or Eurodollar
Standby Loan.

     "Eurodollar   Standby  Borrowing"  shall  mean  a  Borrowing  comprised  of
Eurodollar Standby Loans.

     "Eurodollar Standby Loan" shall mean any Standby Loan bearing interest at a
rate  determined by reference to the LIBO Rate in accordance with the provisions
of Article II.

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

     "Existing   Facility"  shall  mean  the  Credit  Agreement,   dated  as  of
October 29,  1999, among the Borrower, the lenders parties thereto and The Chase
Manhattan Bank, as agent for said lenders.

     "Facility   Fee"  shall  have  the   meaning   assigned  to  such  term  in
Section 2.06(a).

     "Federal  Funds  Effective  Rate" shall  mean,  for any day,  the  weighted
average of the rates on overnight Federal funds transactions with members of the
Federal  Reserve System  arranged by Federal funds brokers,  as published on the
next  succeeding  Business Day by the Federal  Reserve Bank of New York,  or, if
such rate is not so published  for any day which is a Business  Day, the average
of  the   quotations  for  the  day  of  such   transactions   received  by  the
Administrative  Agent from three Federal  funds  brokers of recognized  standing
selected by it.

     "Fees" shall mean the Facility Fee and the Administrative Fees.

     "Financial  Officer" of any  corporation  shall mean the  President,  Chief
Financial Officer, Chief Executive Officer, Vice President - Finance,  Executive
Vice President or Treasurer of such corporation.

     "First  Mortgage Bond  Indentures"  shall mean (i) the  First  Mortgage and
Collateral Trust Indenture,  dated as of March 1, 1947, from the Borrower to The
Marine Midland Trust Company of New York, as Trustee,  and (ii) the Mortgage and
Deed of Trust  Indenture,  dated  as of  June 1,  1962,  from  the  Borrower  to
Manufacturers  Hanover Trust Company,  as Trustee, as the same have been and may
from time to time be amended or supplemented and in effect.

                                       9
<PAGE>

     "Fixed  Rate  Borrowing"  shall mean a  Borrowing  comprised  of Fixed Rate
Loans.

     "Fixed Rate Loan" shall mean any  Competitive  Loan  bearing  interest at a
fixed  percentage rate per annum  (expressed in the form of a decimal to no more
than four  decimal  places)  specified  by the  Lender  making  such Loan in its
Competitive Bid.

     "GAAP" shall mean generally accepted  accounting  principles,  applied on a
consistent basis.

     "Governmental  Approval"  shall  mean any  authorization,  consent,  order,
approval,  license, franchise, lease, ruling, tariff, rate, permit, certificate,
exemption of, or filing or registration with, any Governmental Authority.

     "Governmental  Authority" shall mean any Federal,  state,  local or foreign
court or governmental agency, authority, instrumentality or regulatory body.

     "Hostile  Acquisition" shall mean any Target Acquisition (as defined below)
involving  a tender  offer or proxy  contest  that has not been  recommended  or
approved by the board of  directors  (or similar  governing  body) of the Person
that is the  subject  of such  Target  Acquisition  prior  to the  first  public
announcement or disclosure relating to such Target Acquisition.  As used in this
definition,  the term "Target  Acquisition"  shall mean any transaction,  or any
series  of  related  transactions,  by  which  the  Borrower  and/or  any of its
Subsidiaries directly or indirectly  (i) acquires any ongoing business or all or
substantially  all of the  assets of any  Person or  division  thereof,  whether
through  purchase  of  assets,  merger  or  otherwise,   (ii) acquires  (in  one
transaction  or as the most  recent  transaction  in a series  of  transactions)
control of at least a majority in ordinary  voting power of the  securities of a
Person  which have  ordinary  voting  power for the  election  of  directors  or
(iii) otherwise  acquires  control of a more that 50% ownership  interest in any
such Person.

     "Indebtedness"  of any Person  shall  mean,  without  duplication,  (a) all
obligations  of such Person for  borrowed  money or with  respect to deposits or
advances of any kind,  (b) all  obligations  of such Person  evidenced by bonds,
debentures,  notes or similar  instruments,  (c) all  obligations of such Person
upon which interest charges are customarily  paid,  (d) all  obligations of such
Person under  conditional sale or other title retention  agreements  relating to
property or assets purchased by such Person,  (e) all obligations of such Person
issued or  assumed as the  deferred  purchase  price of  property  or  services,
(f) all  Indebtedness  of others  secured  by (or for  which the  holder of such
Indebtedness has an existing right,  contingent or otherwise,  to be secured by)
any Lien on  property  owned or  acquired  by such  Person,  whether  or not the
obligations secured thereby have been assumed, (g) all Capital Lease Obligations
of such Person,  (h) all  obligations of such Person in respect of interest rate
protection agreements, foreign currency exchange agreements or other interest or
exchange rate hedging  arrangements  (except to the extent such  obligations are
used as a bona  fide  hedge  of  other  Indebtedness  of such  Person),  (i) all
obligations  of such Person as an account  party in respect of letters of credit
and bankers' acceptances (except to the extent any such obligations are incurred
in support of other  obligations  constituting  Indebtedness of such Person) and
(j) any  obligation,  contingent or otherwise,  of such Person  guaranteeing  or
having the economic effect of guaranteeing  any Indebtedness of any other Person
(the  "primary  obligor") in any manner,  whether  directly or  indirectly,  and
including any obligation of such Person,  directly or indirectly (i) to purchase
or pay (or  advance  or  supply  funds  for the  purchase  or  payment  of) such
Indebtedness  or to purchase (or to advance or supply funds for the purchase of)
any security for the payment of such  Indebtedness,  (ii) to purchase  property,
securities   or  services  for  the  purpose  of  assuring  the  owner  of  such
Indebtedness of the payment of such  Indebtedness or (iii) to  maintain  working
capital,  equity capital or other financial  statement condition or liquidity of
the  primary   obligor  so  as  to  enable  the  primary  obligor  to  pay  such
Indebtedness;  provided,  however,  that the term Indebtedness shall not include
endorsements for collection or deposit, in either case in the ordinary course of
business.

                                       10
<PAGE>

     "Interest  Payment Date" shall mean, with respect to any Loan, the last day
of the Interest Period applicable  thereto and, in the case of a Eurodollar Loan
with an  Interest  Period of more than three  months'  duration  or a Fixed Rate
Loan,  each day that would have been an Interest  Payment Date for such Loan had
successive  Interest Periods of three months'  duration or 90 days duration,  as
the case may be, been applicable to such Loan and, in addition,  the date of any
Conversion of such Loan to a Loan of a different Type.

     "Interest Period" shall mean (a) as to any Eurodollar Borrowing, the period
commencing on the date of such  Borrowing or on the last day of the  immediately
preceding Interest Period applicable to such Borrowing,  as the case may be, and
ending on the  numerically  corresponding  day (or,  if there is no  numerically
corresponding  day, on the last day) in the calendar  month that is 1, 2, 3 or 6
months  thereafter  (or such  longer  period  as may be  agreed to by all of the
Lenders),  as the Borrower may elect,  (b) as to any ABR  Borrowing,  the period
commencing  on the  date  of  such  Borrowing  and  ending  on the  date 90 days
thereafter or, if earlier,  on the Termination Date or the date of prepayment of
such Borrowing and (c) as to any Fixed Rate Borrowing,  the period commencing on
the date of such Borrowing and ending on the date  specified in the  Competitive
Bids in which the offer to make the Fixed Rate Loans  comprising  such Borrowing
were  extended,  which shall not be earlier  than the day after the date of such
Borrowing  or later than 364 days (or,  subject to the  Borrower  obtaining  all
necessary Governmental Approvals,  such longer period as may be agreed to by all
of the Lenders) after the date of such Borrowing; provided, however, that if any
Interest  Period  would end on a day other than a Business  Day,  such  Interest
Period shall be extended to the next succeeding Business Day unless, in the case
of Eurodollar  Loans only, such next  succeeding  Business Day would fall in the
next calendar  month,  in which case such Interest  Period shall end on the next
preceding  Business Day.  Interest shall accrue from and including the first day
of an Interest Period to but excluding the last day of such Interest Period.

     "LIBO Rate" shall mean,  with respect to any  Eurodollar  Borrowing for any
Interest Period, an interest rate per annum (rounded upwards,  if necessary,  to
the next 1/16 of 1%) equal to the rate at which  dollar  deposits  approximately
equal in principal amount to (i) in the case of a Standby  Borrowing,  The Chase
Manhattan  Bank's (if then acting as  Administrative  Agent or, in case  another
Person is then acting as  Administrative  Agent, such other Person's) portion of
such  Eurodollar  Borrowing and (ii) in the case of a Competitive  Borrowing,  a
principal amount that would have been The Chase Manhattan Bank's (if then acting
as  Administrative   Agent  or,  in  case  another  Person  is  then  acting  as
Administrative Agent, such other Person's) portion of such Competitive Borrowing
had such  Competitive  Borrowing been a Standby  Borrowing,  and, in the case of
each of clause (i)  and  clause (ii)  above,  for a maturity  comparable to such
Interest  Period,  are  offered  to the  principal  London  office  of The Chase
Manhattan  Bank (or such other  Person then acting as  Administrative  Agent) in
immediately  available  funds in the London  interbank  market at  approximately
11:00 A.M.,  London time,  two Business Days prior to the  commencement  of such
Interest Period.

                                       11
<PAGE>

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

     "Loan" shall mean a Competitive  Loan or a Standby Loan,  whether made as a
Eurodollar Loan, an ABR Loan, or a Fixed Rate Loan, as permitted hereby.

     "Margin"  shall mean, as to any  Eurodollar  Competitive  Loan,  the margin
(expressed  as a  percentage  rate per annum in the form of a decimal to no more
than four  decimal  places) to be added to or  subtracted  from the LIBO Rate in
order to determine  the interest  rate  applicable to such Loan, as specified in
the Competitive Bid relating to such Loan.

     "Margin Regulations" shall mean Regulations T, U and X of the Board.

     "Material  Adverse  Effect" shall mean a materially  adverse  effect on the
business, assets, operations,  condition,  financial or otherwise, or results of
operations of the Borrower and the Subsidiaries taken as a whole.

     "Moody's"  shall mean Moody's  Investors  Service,  Inc.,  or any successor
thereto.

     "Moody's  Rating"  shall mean, on any date of  determination,  (i) the debt
rating most recently announced by Moody's with respect to the long-term, senior,
unsecured,  non-credit enhanced  Indebtedness of the Borrower or (ii) if (A) the
Indebtedness  of the Borrower under this Agreement  shall be credit  enhanced by
any  Person  other than the  Borrower  and (B) both  Moody's  and S&P shall have
assigned a debt rating to such  Indebtedness,  then such debt rating assigned by
Moody's.

     "Net Cash Proceeds" shall mean, with respect to any Sale  Transaction,  the
aggregate  amount of cash received by the Borrower or any Subsidiary  thereof in
connection with such sale after deducting therefrom (i) reasonable and customary
transaction  costs that are, at the time of receipt of such cash,  actually paid
or reserved for payment (A) to a Person that is not an Affiliate of the Borrower
or (B) to the Borrower or an Affiliate of the Borrower to reimburse the Borrower
or such  Affiliate of the  Borrower  for  payments  made by the Borrower or such
Affiliate  of the  Borrower  to another  Person  that is not the  Borrower or an
Affiliate of the Borrower in respect of such  transaction  costs described above
and  (ii) the  amount of taxes  paid or  reasonably  expected  to be  payable in
connection with, or as a result of, such transaction.

     "PBGC" shall mean the Pension Benefit Guaranty  Corporation referred to and
defined in ERISA.

                                       12
<PAGE>

     "Person" shall mean any natural person, corporation,  business trust, joint
venture,  association,  company,  limited  liability  company,  partnership,  or
government, or any agency or political subdivision thereof.

     "Plan" shall mean any pension plan (including a multiemployer plan) subject
to the  provisions  of  Title IV  of ERISA or  Section 412  of the Code which is
maintained for or to which  contributions are made for employees of the Borrower
or any ERISA Affiliate.

     "Prime Rate" shall mean the rate of interest per annum  publicly  announced
from time to time by the Administrative Agent as its prime rate in effect at its
principal  office in New York  City;  each  change in the  Prime  Rate  shall be
effective on the date such change is publicly announced as effective.

     "Principal  Subsidiaries" shall mean any Subsidiary of the Borrower,  other
than Electric  Lightwave,  Inc., whose Consolidated  Tangible Assets comprise in
excess  of 20% of the  Consolidated  Tangible  Assets  of the  Borrower  and its
consolidated Subsidiaries as of the date hereof or at any time hereafter.

     "Register" shall have the meaning given such term in Section 9.04(d).

     "Regulation D" shall mean Regulation D of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

     "Regulation T" shall mean Regulation T of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

     "Regulation U" shall mean Regulation U of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

     "Regulation X" shall mean Regulation X of the Board as from time to time in
effect and all official rulings and interpretations thereunder or thereof.

     "Release"  shall  mean any  spilling,  emitting,  discharging,  depositing,
escaping,  leaching,  dumping or other releasing,  including the movement of any
Specified  Substance  through  the air,  soil,  surface  water,  groundwater  or
property, and when used as a verb has a like meaning.

     "Required  Lenders"  shall mean, at any time,  Lenders  having  Commitments
representing  at least  66-2/3%  of the Total  Commitment  or, for  purposes  of
acceleration  pursuant to clause (ii) of Article VII or if the Total  Commitment
has  terminated,  Lenders  holding  Loans  representing  at least 66-2/3% of the
aggregate principal amount of the Loans outstanding.

     "Revolving Period Maturity Date" shall mean October 26, 2001.

     "Sale  Transaction"  shall mean  (i) the sale by the Borrower or any of its
Subsidiaries  of any  Utilities  Assets or the stock of, or the sale outside the
ordinary course of business of any of the assets of, Electric  Lightwave Inc. or
(ii) the  sale or  issuance  of debt  having a maturity  of at least one year or
equity of the Borrower or any of its Subsidiaries in the capital or bank markets
for the purpose of financing the Acquisitions.

                                       13
<PAGE>

     "S&P"  shall  mean  Standard & Poo's  Ratings  Services,  a division  ofThe
McGraw-Hill Companies, Inc., or any successor thereto.

     "S&P Rating" shall mean, on any date of determination,  (i) the debt rating
most recently announced by S&P with respect to the long-term, senior, unsecured,
non-credit enhanced Indebtedness of the Borrower or (ii) if (A) the Indebtedness
of the  Borrower  under this  Agreement  shall be credit  enhanced by any Person
other than the Borrower and (B) both S&P and Moody's  shall have assigned a debt
rating to such Indebtedness, then such debt rating assigned by S&P.

     "Specified  Substance" shall mean (i) any  chemical,  material or substance
defined as or included in the definition of "hazardous  substances",  "hazardous
wastes",   "hazardous  materials",   "extremely  hazardous  waste",  "restricted
hazardous  waste" or "toxic  substances"  or words of similar  import  under any
applicable  Environmental  Laws;  (ii) any  (A) oil,  natural gas,  petroleum or
petroleum  derived  substance,  any drilling  fluids,  produced waters and other
wastes associated with the exploration,  development or production of crude oil,
natural gas or geothermal  fluid,  any flammable  substances or explosives,  any
radioactive materials,  any hazardous wastes or substances,  any toxic wastes or
substances or (B) other  materials or  pollutants  that, in the case of both (A)
and (B),  (1) pose  a  hazard  to the  property  of the  Borrower  or any of its
Subsidiaries  or any part thereof or to persons on or about such  property or to
any other  property  that may be affected by the  Release of such  materials  or
pollutants from such property or any part thereof or to persons on or about such
other  property  or  (2) cause  such  property  or such other  property to be in
violation of any  Environmental  Law;  (iii) asbestos,  urea  formaldehyde  foam
insulation,  toluene,  polychlorinated  biphenyls and any  electrical  equipment
which contains any oil or dielectric fluid containing levels of  polychlorinated
biphenyls in excess of fifty parts per million;  and (iv) any sound,  vibration,
heat,  radiation  or other form of energy and any other  chemical,  material  or
substance,  exposure  to  which  is  prohibited,  limited  or  regulated  by any
Governmental Authority.

     "Standby  Borrowing"  shall mean a  Borrowing  consisting  of  simultaneous
Standby Loans from each of the Lenders.

     "Standby  Borrowing  Request" shall mean a request made pursuant to Section
2.04 in the form of Exhibit A-5.

     "Standby  Loans" shall mean the revolving  loans made by the Lenders to the
Borrower  pursuant to Section  2.04.  Each  Standby  Loan shall be a  Eurodollar
Standby  Loan or an ABR Loan.  All  Standby  Loans by a Lender of the same Type,
having the same  Interest  Period and made or Converted on the same day shall be
deemed  to be a  single  Standby  Loan  by  such  Lender  until  repaid  or next
Converted.

     "Subsidiary"  shall mean, with respect to any Person (herein referred to as
the "parent"),  any  corporation,  partnership,  association,  or other business
entity (a) of which securities or other ownership  interests  representing  more
than 50% of the  equity or more than 50% of the  ordinary  voting  power or more
than 50% of the general partnership interests are, at the time any determination
is being made, owned, controlled, or held by the parent, or (b) which is, at the
time any  determination  is made,  otherwise  Controlled by the parent or one or
more subsidiaries of the parent or by the parent and one or more subsidiaries of
the parent.  Unless  otherwise  indicated,  all  references in this Agreement to
"Subsidiaries" shall be construed as references to Subsidiaries of the Borrower.

                                       14
<PAGE>

     "Term  Election"   shall  have  the  meaning   assigned  to  such  term  in
Section 2.07(b).

     "Term  Maturity  Date"  shall  have the  meaning  assigned  to such term in
Section 2.07(b).

     "Termination  Date"  shall mean the  earlier to occur of (i) the  Revolving
Period  Maturity  Date or, if the  Borrower  makes  the  election  described  in
Section 2.07(b),  the Term  Maturity Date and (ii) the  date of  termination  or
reduction in whole of the Commitments pursuant to Section 2.11 or Article VII.

     "Total  Commitment"  shall  mean at any time the  aggregate  amount  of the
Lenders' Commitments, as in effect at such time.

     "Transferee" shall mean any transferee or assignee of all or any portion of
a  Lender's  interests,   rights  and  obligations   hereunder,   including  any
participation holder.

     "Type",  when used in respect of any Loan or Borrowing,  shall refer to the
Rate by reference to which interest on such Loan or on the Loans comprising such
Borrowing is  determined.  For purposes  hereof,  "Rate" shall  include the LIBO
Rate, the Alternate  Base Rate and the rate of interest  applicable to any Fixed
Rate Loan.

     "Utilities  Assets" shall mean any assets of the Borrower or any Subsidiary
thereof (including,  without limitation,  stock in any such Subsidiary) that are
employed in the  generation or  production,  transmission  or  distribution  (as
applicable) of  electricity,  natural gas,  synthetic gas or water,  or that are
used to provide wastewater services.

     "Utilization  Period" shall mean any day or days during which the aggregate
amount of Loans  outstanding  hereunder  is equal to or greater  than 33% of the
Total Commitment for such day or days.

     Section 1.02. Terms Generally.

     The  definitions in  Section 1.01  shall apply equally to both the singular
and plural forms of the terms  defined.  Whenever  the context may require,  any
pronoun shall include the  corresponding  masculine,  feminine and neuter forms.
The words "include",  "includes" and "including"  shall be deemed to be followed
by the phrase "without limitation". All references herein to Articles, Sections,
Exhibits and Schedules  shall be deemed  references to Articles and Sections of,
and  Exhibits  and  Schedules  to,  this  Agreement,  unless the  context  shall
otherwise require.  Except as otherwise  expressly provided herein, all terms of
an accounting or financial nature shall be construed in accordance with GAAP, as
in  effect  from  time  to  time;  provided,  however,  that,  for  purposes  of
determining  compliance  with any  covenant  set forth in Article VI, such terms
shall be  construed  in  accordance  with  GAAP as in effect on the date of this
Agreement  applied on a basis  consistent with the application used in preparing
the Borrower's audited financial statements referred to in Section 3.02.

                                       15
<PAGE>

                                   Article II

                                   THE CREDITS

     Section 2.01. Commitments.

     Subject to the terms and  conditions  and relying upon the  representations
and warranties herein set forth, each Lender agrees,  severally and not jointly,
to make Standby Loans to the Borrower,  at any time and from time to time on and
after the Effective Date and until the earlier to occur of the Revolving  Period
Maturity  Date and the  termination  of the  Commitment  of such  Lender,  in an
aggregate  principal  amount at any time outstanding not to exceed such Lender's
Commitment minus the amount by which the Competitive  Loans  outstanding at such
time  shall be deemed to have used such  Commitment  pursuant  to  Section 2.16,
subject  however,  to the  conditions  that (a) at no time shall  (i) the sum of
(x) the outstanding  aggregate principal amount of all Standby Loans made by all
Lenders plus (y) the outstanding  aggregate  principal amount of all Competitive
Loans made by all Lenders exceed (ii) the Total Commitment, and (b) at all times
the  outstanding  aggregate  principal  amount of all Standby Loans made by each
Lender  shall  equal the  product of  (i) the  percentage  which its  Commitment
represents  of  the  Total  Commitment  times  (ii) the  outstanding   aggregate
principal  amount of all  Standby  Loans made  pursuant  to  Section 2.04.  Each
Lender's  Commitment is set forth opposite its respective name in Schedule 2.01.
Such  Commitments  may be  modified  or reduced  from time to time  pursuant  to
Section 2.11 and Section 2.13(f).

     Within the foregoing  limits,  the Borrower may borrow,  pay, or prepay and
reborrow  hereunder,  on and after the Effective Date and prior to the Revolving
Period Maturity Date, subject to the terms, conditions and limitations set forth
herein.

     Section 2.02. Loans.

     (a) Each  Standby Loan shall be made as part of a Borrowing  consisting  of
Loans  made  by the  Lenders  ratably  in  accordance  with  their  Commitments;
provided, however, that the failure of any Lender to make any Standby Loan shall
not in itself  relieve any other Lender of its  obligation to lend hereunder (it
being understood,  however,  that no Lender shall be responsible for the failure
of any other Lender to make any Loan required to be made by such other  Lender).
Each  Competitive Loan shall be made in accordance with the procedures set forth
in Section 2.03. The Standby Loans or Competitive Loans comprising any Borrowing
shall be in an  aggregate  principal  amount  which is an  integral  multiple of
$1,000,000 and not less than  $10,000,000  (or, in the case of Standby Loans, an
aggregate  principal  amount  equal to the  remaining  balance of the  available
Commitments).

     (b) Each  Competitive  Borrowing shall be comprised  entirely of Eurodollar
Competitive  Loans or Fixed Rate  Loans,  and each  Standby  Borrowing  shall be
comprised entirely of Eurodollar Standby Loans or ABR Loans, as the Borrower may
request pursuant to Section 2.03 or 2.04, as applicable.  Each Lender may at its
option make any  Eurodollar  Loan by causing any  domestic or foreign  branch or
Affiliate of such Lender to make such Loan;  provided  that any exercise of such
option  shall not affect the  obligation  of the  Borrower to repay such Loan in
accordance  with the terms of this  Agreement.  Borrowings of more than one Type
may be outstanding at the same time; provided,  however, that the Borrower shall
not be entitled to request any  Borrowing  which,  if made,  would  result in an
aggregate  of  more  than  ten  separate  Standby  Loans  of  any  Lender  being
outstanding  hereunder  at any one time.  For purposes of the  foregoing,  Loans
having different  Interest  Periods,  regardless of whether they commence on the
same date, shall be considered separate Loans.

                                       16
<PAGE>

     (c) Each  Lender  shall  make each Loan to be made by it  hereunder  on the
proposed date thereof by wire  transfer of  immediately  available  funds to the
Administrative  Agent in New York, New York, not later than 1:00 P.M.,  New York
City time, and the Administrative Agent shall by 3:00 P.M.,  New York City time,
credit the amounts so received to the general  deposit  account of the  Borrower
with the  Administrative  Agent or, if a Borrowing  shall not occur on such date
because any condition precedent herein specified shall not have been met, return
the amounts so received to the respective  Lenders.  Competitive  Loans shall be
made by the Lender or Lenders  whose  Competitive  Bids  therefor  are  accepted
pursuant to Section 2.03 in the amounts so accepted  and Standby  Loans shall be
made by the  Lenders  pro  rata in  accordance  with  Section 2.16.  Unless  the
Administrative  Agent shall have received notice from a Lender prior to the date
of any Borrowing (or, in the case of an ABR Borrowing, prior to the time of such
ABR Borrowing)  that such Lender will not make  available to the  Administrative
Agent such Lender's  portion of such  Borrowing,  the  Administrative  Agent may
assume that such Lender has made such portion  available  to the  Administrative
Agent on the date of such Borrowing in accordance  with this  paragraph (c)  and
the Administrative  Agent may, in reliance upon such assumption,  make available
to the Borrower on such date a corresponding  amount.  If and to the extent that
such Lender  shall not have made such portion  available  to the  Administrative
Agent and the  Administrative  Agent has made  available  to the  Borrower  such
portion,  such  Lender  and  the  Borrower  severally  agree  to  repay  to  the
Administrative  Agent forthwith on demand such  corresponding  amount,  together
with interest  thereon for each day from the date such amount is made  available
to the Borrower until the date such amount is repaid to the Administrative Agent
at (i) in the case of the Borrower,  the interest rate applicable at the time to
the Loans  comprising  such  Borrowing and (ii) in the case of such Lender,  the
Federal Funds Effective  Rate. If such Lender shall repay to the  Administrative
Agent such corresponding amount, such amount shall constitute such Lender's Loan
as part of such Borrowing for purposes of this Agreement.

     (d)  Notwithstanding  any other provision of this  Agreement,  the Interest
Period requested by the Borrower with respect to any Borrowing shall not (unless
otherwise  agreed to by all of the  Lenders)  end after the  earlier to occur of
(i) the  Termination Date and (ii) the latest date permitted by any Governmental
Approval then in effect for the Borrower to have outstanding Borrowings.

     Section 2.03. Competitive Bid Procedure.

     (a) Subject to the terms and conditions set forth herein, from time to time
during the period from and  including  the  Effective  Date to but excluding the
earlier to occur of the Revolving  Period  Maturity Date and the  termination of
the Commitments of all Lenders,  the Borrower may request  Competitive  Bids and
may, but shall not have any  obligation to, accept  Competitive  Bids and borrow
Competitive  Loans;  provided,  that  at  no  time  shall  the  sum  of  (x) the
outstanding  aggregate principal amount of all Standby Loans made by all Lenders
plus (y) the  outstanding  aggregate  principal amount of all Competitive  Loans
made by all Lenders exceed the Total Commitment. In order to request Competitive
Bids, the Borrower shall hand deliver or telecopy to the Administrative  Agent a
duly completed  Competitive Bid Request in the form of Exhibit A-1 hereto, to be
received by the Administrative Agent (i) in the case of a Eurodollar Competitive
Borrowing,  not later than  10:00 A.M.,  New York City time,  four Business Days
before a proposed  Competitive  Borrowing  and  (ii) in the case of a Fixed Rate
Borrowing,  not later than  10:00 A.M.,  New York City time,  one  Business  Day
before a proposed Competitive  Borrowing.  No ABR Loan shall be requested in, or
made pursuant to, a Competitive Bid Request. A Competitive Bid Request that does
not conform  substantially  to the format of Exhibit A-1  may be rejected in the
Administrative  Agent's  sole  discretion,  and the  Administrative  Agent shall
promptly notify the Borrower of such rejection by telecopier. Such request shall
in each case refer to this Agreement and specify  (x) whether the Borrowing then
being  requested  is to be a  Eurodollar  Borrowing  or a Fixed Rate  Borrowing,
(y) the date of such Borrowing (which shall be a Business Day) and the aggregate
principal  amount  thereof  which  shall be in a  minimum  principal  amount  of
$10,000,000  and in an integral  multiple of  $1,000,000,  and (z) the  Interest
Period(s)  with respect  thereto  (which may not end after the Revolving  Period
Maturity Date unless otherwise agreed to by all of the Lenders).  Promptly after
its receipt of a Competitive Bid Request that is not rejected as aforesaid,  the
Administrative  Agent  shall  invite  by  telecopier  (in the form set  forth in
Exhibit A-2  hereto)  the Lenders to bid,  on the terms and  conditions  of this
Agreement, to make Competitive Loans pursuant to the Competitive Bid Request.

                                       17
<PAGE>

     (b) Each Lender may, in its sole  discretion,  make one or more Competitive
Bids to the Borrower  responsive to a Competitive Bid Request.  Each Competitive
Bid by a Lender must be received by the Administrative Agent via telecopier,  in
the form of  Exhibit A-3  hereto,  (i) in the case of a  Eurodollar  Competitive
Borrowing,  not later than  9:30 A.M.,  New York City time,  three Business Days
before a proposed  Competitive  Borrowing  and  (ii) in the case of a Fixed Rate
Borrowing,  not  later  than  9:30 A.M.,  New York  City  time,  on the day of a
proposed  Competitive   Borrowing.   Multiple  bids  will  be  accepted  by  the
Administrative Agent.  Competitive Bids that do not conform substantially to the
format  of  Exhibit A-3  may be  rejected  by  the  Administrative  Agent  after
conferring   with,  and  upon  the  instruction   of,  the  Borrower,   and  the
Administrative  Agent shall notify the Lender making such  nonconforming  bid of
such rejection as soon as practicable.  Each Competitive Bid shall refer to this
Agreement and specify (x) the range of principal amounts (each of which shall be
in a minimum  principal  amount of  $5,000,000  and in an  integral  multiple of
$1,000,000  and,  in the case of the larger  such  amount,  may equal the entire
principal amount of the Competitive  Borrowing requested by the Borrower) of the
Competitive  Loan or Loans that the  Lender is willing to make to the  Borrower,
(y) the  Competitive  Bid Rate or Rates at which the Lender is  prepared to make
the  Competitive  Loan or Loans and  (z) the  Interest  Period  and the last day
thereof.  If any Lender shall elect not to make a  Competitive  Bid, such Lender
shall so notify  the  Administrative  Agent via  telecopier  (A) in  the case of
Eurodollar  Competitive  Loans,  not later than  9:30 A.M.,  New York City time,
three Business Days before a proposed Competitive Borrowing, and (B) in the case
of Fixed Rate Loans, not later than 9:30 A.M., New York City time, on the day of
a proposed Competitive  Borrowing;  provided,  however,  that the failure by any
Lender to give such notice  shall not cause such Lender to be  obligated to make
any Competitive  Loan as part of such Competitive  Borrowing.  A Competitive Bid
submitted by a Lender pursuant to this  paragraph (b)  shall be irrevocable.  If
the Administrative Agent shall not have received from any Lender notification of
its election to make a  Competitive  Bid on or before the times set forth in the
second sentence of this  paragraph,  such Lender shall be deemed to have elected
not to make a Competitive Bid.

                                       18
<PAGE>

     (c) The  Administrative  Agent shall  promptly  notify (but in any event no
later than  10:00 A.M.,  New York City time, on the day any  Competitive  Bid is
received by the  Administrative  Agent) the  Borrower by  telecopier  of all the
Competitive  Bids made, the  Competitive  Bid Rate and the principal  amount (or
range thereof) of each  Competitive  Loan in respect of which a Competitive  Bid
was made and the identity of the Lender that made each bid.  The  Administrative
Agent shall send a copy of all Competitive  Bids to the Borrower for its records
as soon as practicable after completion of the bidding process set forth in this
Section 2.03.

     (d) The Borrower may in its sole and absolute  discretion,  subject only to
the  provisions  of this  paragraph (d),  accept  or reject  all or any  portion
(within the range of principal amounts specified therein) of any Competitive Bid
referred to in paragraph (c) above. The Borrower shall notify the Administrative
Agent by telephone,  confirmed by  telecopier  in the form of a Competitive  Bid
Accept/Reject  Letter,  whether  and to what  extent it has decided to accept or
reject any of or all the bids  referred to in  paragraph (c)  above,  (x) in the
case of a Eurodollar Competitive Borrowing, not later than 11:00 A.M.,  New York
City time,  three  Business  Days before a proposed  Competitive  Borrowing  and
(y) in the case of a Fixed Rate Borrowing,  not later than 11:00 A.M.,  New York
City time, on the day of a proposed Competitive  Borrowing;  provided,  however,
that (i) the failure by the Borrower to give such notice shall be deemed to be a
rejection of all the bids referred to in paragraph (c) above,  (ii) the Borrower
shall not accept a bid made at a particular Competitive Bid Rate if the Borrower
has  decided  to reject a bid made at a lower  Competitive  Bid Rate,  (iii) the
aggregate  amount of the  Competitive  Bids  accepted by the Borrower  shall not
exceed the principal  amount  specified in the Competitive Bid Request,  (iv) if
the Borrower  shall accept a bid or bids made at the same  Competitive  Bid Rate
but the  amount of such bid or bids shall  cause the total  amount of bids to be
accepted by the Borrower to exceed the amount  specified in the  Competitive Bid
Request,  then the  Borrower  shall  accept a portion  of such bid or bids in an
amount no greater than the amount  specified in the Competitive Bid Request less
the  amount  of all  other  Competitive  Bids at a lower  Competitive  Bid  Rate
accepted with respect to such Competitive Bid Request, which acceptance,  in the
case of multiple bids at such  Competitive  Bid Rate,  shall be made pro rata in
accordance with the lowest amount of each such bid at such Competitive Bid Rate,
and  (v) except  pursuant to clause (iv)  above,  no bid shall be accepted for a
Competitive Loan unless such  Competitive Loan is in a minimum  principal amount
of $5,000,000 and an integral multiple of $1,000,000; provided further, however,
that if a Competitive Loan must be in an amount less than $5,000,000  because of
the provisions of clause (iv)  above, such Competitive Loan may be for a minimum
of $1,000,000 or any integral multiple thereof,  and in calculating the pro rata
allocation  of  acceptances  of  portions  of  multiple  bids  at  a  particular
Competitive  Bid Rate  pursuant to  clause (iv)  the amounts shall be rounded to
integral multiples of $1,000,000 in a manner which shall be in the discretion of
the  Borrower.  A notice  given by the Borrower  pursuant to this  paragraph (d)
shall be irrevocable.

     (e) The  Administrative  Agent shall  promptly  notify each bidding  Lender
whether or not its  Competitive Bid has been accepted (and if so, in what amount
and at what  Competitive  Bid  Rate) by  telecopier  sent by the  Administrative
Agent, and each successful  bidder will thereupon  become bound,  subject to the
other applicable  conditions  hereof, to make the Competitive Loan in respect of
which its bid has been accepted.

                                       19
<PAGE>

     (f) If the Administrative  Agent shall elect to submit a Competitive Bid in
its capacity as a Lender,  it shall submit such bid directly to the Borrower not
later than 9:15 A.M.,  New York City time, on the day on which the other Lenders
are  required  to submit  their bids to the  Administrative  Agent  pursuant  to
paragraph (b) above.

     (g) All notices  required by this Section 2.03 shall be given in accordance
with Section 9.01.

     Section 2.04. Standby Borrowing Procedure.

     In order to request a Standby  Borrowing  (other  than a  Conversion),  the
Borrower shall hand deliver or telecopy to the Administrative  Agent a notice in
the form of Exhibit A-5 (a) in the case of a Eurodollar  Standby Borrowing,  not
later than 11:00 A.M., New York City time, three Business Days before a proposed
Borrowing,  and (b) in the case of an ABR Borrowing,  not later than 11:00 A.M.,
New York City time, on the day of a proposed Borrowing. No Fixed Rate Loan shall
be requested or made pursuant to a Standby Borrowing Request.  Such notice shall
be irrevocable  (unless otherwise  expressly  provided herein) and shall in each
case  specify  (i) whether  the  Borrowing  then  being  requested  is  to  be a
Eurodollar Standby Borrowing or an ABR Borrowing;  (ii) the date of such Standby
Borrowing  (which shall be a Business Day) and the amount thereof;  and (iii) if
such Borrowing is to be a Eurodollar Standby Borrowing, the Interest Period with
respect thereto. If no election as to the Type of Standby Borrowing is specified
in any  such  notice,  then  the  requested  Standby  Borrowing  shall be an ABR
Borrowing.  If no  Interest  Period  with  respect  to  any  Eurodollar  Standby
Borrowing is specified in any such notice,  then the Borrower shall be deemed to
have selected an Interest  Period of one month's  duration.  The  Administrative
Agent shall  promptly  advise (but in any event no later than 12:00 noon on such
date) the Lenders of any notice given pursuant to this  Section 2.04 and of each
Lender's portion of the requested Borrowing.

     Section 2.05. Conversions.

     The  Borrower  may from time to time  Convert any Standby  Loan (or portion
thereof) of any Type and with any Interest Period (if applicable) to one or more
Standby  Loans of the same or any other  Type and with any  Interest  Period (if
applicable)  by delivering  (by hand delivery or  telecopier) a request for such
Conversion in the form of Exhibit A-6 to the Administrative  Agent no later than
(i) 11:00 A.M.,  New York City time, on the third Business Day prior to the date
of any proposed  Conversion into a Eurodollar Standby Loan and  (ii) 11:00 A.M.,
New York City time, on the day of any proposed  Conversion into an ABR Loan. The
Administrative  Agent shall give each Lender  prompt  notice of each  Conversion
Request.   Each  Conversion  Request  shall  be  irrevocable  (unless  otherwise
expressly  provided  herein) and binding on the Borrower  and shall  specify the
requested (A) date of such Conversion, (B) Type of, and Interest Period, if any,
applicable to, the Standby Loans (or portions thereof) proposed to be Converted,
(C) Type of Standby Loans to which such Standby Loans (or portions  thereof) are
proposed to be Converted,  (D) initial Interest Period, if any, to be applicable
to the Standby Loans resulting from such Conversion and (E) aggregate  amount of
Standby  Loans (or portions  thereof)  proposed to be  Converted.  No Eurodollar
Standby Loans may be Converted on a date other than the last day of the Interest
Period applicable  thereto,  unless the Borrower reimburses each Lender pursuant
to Section 2.15 for all losses or expenses incurred by such Lender in connection
with such  Conversion.  If the Borrower  shall fail to give a timely  Conversion
Request  pursuant  to this  subsection  in respect of any  Standby  Loans,  such
Standby  Loans  shall,  on the  last day of the then  existing  Interest  Period
therefor,  automatically  Convert  into,  or remain  as, as the case may be, ABR
Loans,  unless such Standby Loans are repaid at the end of such Interest Period.
If the  Borrower  shall fail,  in any  Conversion  Request  that has been timely
given,  to select the  duration of any Interest  Period for Standby  Loans to be
Converted into Eurodollar  Standby Loans,  such Standby Loans shall, on the last
day of the then existing  Interest Period therefor,  automatically  Convert into
Eurodollar Standby Loans with an Interest Period of one months' duration. If, on
the date of any proposed  Conversion,  the Borrower shall have failed to fulfill
any  condition set forth in Section  4.01,  all Standby  Loans then  outstanding
shall, on such date,  automatically  Convert into, or remain as, as the case may
be, ABR Loans.

                                       20
<PAGE>

     Section 2.06. Fees.

     (a) The Borrower agrees to pay to each Lender,  through the  Administrative
Agent, on each March 31,  June 30,  September 30 and December 31, on the date on
which the  Commitment of such Lender shall be terminated as provided  herein and
on the  Termination  Date, a facility fee (a "Facility Fee") at a rate per annum
equal to the  Applicable  Rate from time to time in effect on (i) the  amount of
the  Commitment  of such Lender,  whether used or unused,  during the  preceding
quarter  (or  shorter  period  commencing  on the date  hereof  or ending on the
Revolving Period Maturity Date or any other date on which the Commitment of such
Lender  shall be  terminated)  and (ii) in the event that the  Commitments  have
terminated and/or the Borrower has made the Term Election,  the aggregate amount
of the Standby  Loans owed by the Borrower to such Lender  during the  preceding
quarter (or shorter period ending on the later of the Term Maturity Date and the
date on which such Standby  Loans are paid in full).  All Facility Fees shall be
computed on the basis of the actual  number of days  elapsed in a year of 365 or
366 days, as the case may be. The Facility Fee due to each Lender shall commence
to  accrue  on the date  hereof  and  shall  cease to accrue on the later of the
Termination Date and the date of payment in full of the Loans,  accrued interest
thereon and all other amounts payable hereunder.

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

     (c) All Fees  shall be paid on the  dates  due,  in  immediately  available
funds,  to the  Administrative  Agent for  distribution,  if and as appropriate,
among the Lenders.  Once paid,  none of the Fees shall be  refundable  under any
circumstances.

     Section 2.07. Repayment of Loans.

     (a) The outstanding principal balance of each Loan shall be payable, in the
case of each  Competitive  Loan,  on the earlier to occur of the last day of the
Interest Period  applicable to such Loan and the  Termination  Date, and, in the
case of each Standby Loan, on the Termination  Date,  unless otherwise agreed to
by all of the Lenders.  Each  Competitive  Loan and each Standby Loan shall bear
interest from the date thereof on the outstanding  principal  balance thereof as
set forth in Section 2.08.  Each Lender shall,  and is hereby  authorized by the
Borrower to record in such Lender's  internal  records an  appropriate  notation
evidencing  the date and amount of each  Competitive  Loan or Standby  Loan,  as
applicable,  of such  Lender,  each  payment or  prepayment  of principal of any
Competitive  Loan or  Standby  Loan,  as  applicable,  and such  other  relevant
information as such Lender records in its internal records with respect to loans
of a type  similar to such  Loans;  provided,  however,  that the failure of any
Lender to make such a  notation  or any error  therein  shall not in any  manner
affect the obligation of the Borrower to repay the Competitive  Loans or Standby
Loans, as applicable, made by such Lender in accordance with the terms hereof.

                                       21
<PAGE>

     (b) The Borrower may elect, by providing written notice of such election to
the Administrative  Agent (who shall promptly advise the Lenders of such notice)
at least five but no more than 30 days prior to the  Revolving  Period  Maturity
Date, to have all or a portion of the Standby Loans outstanding on the Revolving
Period  Maturity  Date  mature  not  later  than the  first  anniversary  of the
Revolving Period Maturity Date (such election being the "Term  Election").  Such
notice  shall be  irrevocable  and  binding on the  Borrower  and shall  specify
(i) the  date (the "Term  Maturity  Date") on which the  Borrower  desires  such
Standby Loans to mature and (ii) the  Standby Loans and the amount  thereof that
shall mature on the Term Maturity  Date. The Term Election shall be effective on
the  Revolving  Period  Maturity  Date if and only if on such date no Default or
Event of Default  shall have  occurred  and be  continuing  or would  occur as a
result of the Term Election.  Upon the  effectiveness of the Term Election,  the
Borrower  shall no longer have the right to borrow any  unfunded  portion of the
Commitments  or  reborrow  all or any part of the Loans that have been repaid or
prepaid. The Term Election may be made only once.

     (c) Any Lender may request that any Loans made by it be evidenced by one or
more promissory notes. Promptly upon receipt of such request, the Borrower shall
prepare, execute and deliver to such Lender one or more promissory notes payable
to the order of such Lender (or, if requested by such Lender, to such Lender and
its assignees)  substantially in the form of Exhibit E-1 or E-2, as appropriate.
Thereafter,  the Loans evidenced by such promissory  notes and interest  thereon
shall at all times  (including  after  assignment  pursuant to  Section 9.04) be
represented by one or more promissory notes in such form payable to the order of
the payee named therein.

     Section 2.08. Interest on Loans.

     (a) Subject to the provisions of  Section 2.09,  the Loans  comprising each
Eurodollar  Borrowing  shall bear interest  (computed on the basis of the actual
number of days  elapsed  over a year of 360  days) at a rate per annum  equal to
(i) in the case of each Eurodollar  Standby Loan, the LIBO Rate for the Interest
Period in effect for such Borrowing  plus the  Applicable  Rate, and (ii) in the
case of each Eurodollar  Competitive Loan, the LIBO Rate for the Interest Period
in effect for such  Borrowing  plus the Margin offered by the Lender making such
Loan and accepted by the  Borrower  pursuant to  Section 2.03.  Interest on each
Eurodollar  Borrowing shall be payable on each applicable Interest Payment Date.
The LIBO Rate for each Interest Period shall be determined by the Administrative
Agent,  and such  determination  shall be conclusive  absent manifest error. The
Administrative  Agent shall promptly (but in any event no later than 10:30 A.M.,
New York City time, two Business Days prior to the commencement of such Interest
Period)  (A) advise  the  Borrower  and each  Lender,  as  appropriate,  of such
determination  and  (B) upon the request of the  Borrower,  provide the Borrower
with the calculations and relevant factors supporting such determination.

                                       22
<PAGE>

     (b) Subject to the provisions of  Section 2.09,  the Loans  comprising each
ABR Borrowing shall bear interest (computed on the basis of the actual number of
days elapsed over a year of 365 days when determined with reference to the Prime
Rate and over a year of 360 days in all other  cases) at a rate per annum  equal
to the  Alternate  Base  Rate plus the  Applicable  Rate.  Interest  on each ABR
Borrowing  shall be  payable  on each  applicable  Interest  Payment  Date.  The
Alternate Base Rate shall be determined by the  Administrative  Agent,  and such
determination  shall be conclusive  absent  manifest error.  The  Administrative
Agent shall promptly (but in any event no later than  11:30 A.M.,  New York City
time, on the day of each ABR Borrowing)  (A) advise the Borrower and each Lender
of such  determination  and  (B) upon the request of the  Borrower,  provide the
Borrower  with  the   calculations   and  relevant   factors   supporting   such
determination.

     (c) Subject to the provisions of  Section 2.09,  each Fixed Rate Loan shall
bear interest at a rate per annum (computed on the basis of the actual number of
days  elapsed  over a year of 360  days)  equal to the  fixed  rate of  interest
offered by the Lender making such Loan and accepted by the Borrower  pursuant to
Section 2.03.  Interest on each Fixed Rate Loan shall be payable on the Interest
Payment  Dates  applicable  to such Loan  except as  otherwise  provided in this
Agreement.

     Section 2.09. Default Interest.

     If the  Borrower  shall  default  in the  payment  of the  principal  of or
interest on any Loan or any other  amount  becoming  due  hereunder,  whether by
scheduled  maturity,  notice of  prepayment,  acceleration,  or  otherwise,  the
Borrower  shall on demand  from time to time from the  Administrative  Agent pay
interest,  to the extent  permitted by law, on such defaulted  amount up to (but
not including) the date of actual payment (after as well as before  judgment) at
a rate per annum  (computed  on the basis of the actual  number of days  elapsed
over a year of 360 days) equal to the Alternate Base Rate plus 2%.

     Section 2.10. Alternate Rate of Interest.

     In the event, and on each occasion, that on the day two Business Days prior
to the  commencement  of any  Interest  Period for a  Eurodollar  Borrowing  the
Administrative Agent shall have determined that dollar deposits in the principal
amounts of the  Eurodollar  Loans  comprising  such  Borrowing are not generally
available in the London interbank market, or that the rates at which such dollar
deposits are being offered will not  adequately  and fairly  reflect the cost to
any Lender of making or  maintaining  its  Eurodollar  Loan during such Interest
Period,  or that reasonable  means do not exist for  ascertaining the LIBO Rate,
the Administrative Agent shall, as soon as practicable thereafter,  give written
notice of such  determination  to the Borrower and the Lenders.  In the event of
any such  determination,  until the Administrative  Agent shall have advised the
Borrower  and the Lenders that the  circumstances  giving rise to such notice no
longer exist, (i) any such request by the Borrower for a Eurodollar  Competitive
Borrowing  pursuant to Section 2.03 shall be of no force and effect and shall be
denied by the Administrative  Agent, (ii) any such request by the Borrower for a
Eurodollar  Standby Borrowing  pursuant to Section 2.04  shall be deemed to be a
request for an ABR  Borrowing  (unless the  Borrower  shall have  withdrawn  its
request for such Eurodollar  Standby  Borrowing not later than  10:00 A.M.,  New
York City time, on the day of the proposed  Borrowing) and (iii) any  request by
the  Borrower  for  a  Conversion  to  Eurodollar   Standby  Loans  pursuant  to
Section 2.05  shall be  deemed  to be a request  for a  Conversion  to ABR Loans
(unless the Borrower  shall have  withdrawn its request for such  Conversion not
later  than  10:00 A.M.,  New  York  City  time,  on the  day  of  the  proposed
Conversion).  Each determination by the Administrative  Agent hereunder shall be
conclusive absent manifest error.

                                       23
<PAGE>

     Section 2.11. Changes in Commitments.

     (a) Upon at least three Business Days' prior irrevocable  written notice to
the  Administrative  Agent,  the Borrower  may at any time in whole  permanently
terminate,  or  from  time  to  time  in  part  permanently  reduce,  the  Total
Commitment;  provided,  however,  that (i) each  partial  reduction of the Total
Commitment  shall be in an  integral  multiple  of  $1,000,000  and in a minimum
principal  amount of $10,000,000 and (ii) no such termination or reduction shall
be made which  would  reduce  the Total  Commitment  to an amount  less than the
aggregate outstanding principal amount of the Competitive Loans.

     (b) The Total Commitment shall be permanently reduced in an amount equal to
the amount of any  prepayment  required to be made pursuant to  Section 2.12(c),
regardless  of whether  any Loans are  outstanding  or  actually  prepaid,  such
reduction to be effective on the scheduled date for such prepayment.

     (c) Each reduction in the Total Commitment  hereunder shall be made ratably
among the Lenders in accordance with their respective Commitments.  The Borrower
shall pay to the  Administrative  Agent for the account of the  Lenders,  on the
date of each  termination  or reduction,  the Facility Fees on the amount of the
Commitments  so  terminated  or  reduced   accrued  through  the  date  of  such
termination or reduction. Subject to Section 2.06(a)(ii), no additional Facility
Fees on the amount of the Commitments so terminated or reduced will accrue.

     (d) Unless earlier terminated pursuant to the terms of this Agreement,  the
Commitment of each Lender shall  automatically and permanently  terminate on the
Revolving Period Maturity Date.

                                       24
<PAGE>

     (e) Provided that no Default or Event of Default shall have occurred and be
continuing,  the  Borrower  shall have the  right,  without  the  consent of the
Lenders  but subject to the terms of an  amendment  hereto  entered  into by the
Borrower  and the  Administrative  Agent,  to  effectuate  from  time to time an
increase in the Total  Commitment by (x) the accession to this  Agreement of one
or more financial  institutions as a Lender or as Lenders or (y) allowing one or
more Lenders to increase its Commitment  hereunder (any such event  described in
clause  (x) or  (y)  being  a  "Commitment  Increase");  provided  that  (i) the
aggregate amount of Commitment Increases  effectuated pursuant to this paragraph
shall not exceed  $800,000,000,  (ii) no Lender's  Commitment shall be increased
without the consent of such  Lender,  (iii) on  the  effective  date of any such
Commitment Increase, there are no outstanding Eurodollar Standby Loans, and (iv)
no Commitment  Increase may occur  pursuant to this  paragraph on any date after
January 31, 2001.  Each party hereto  hereby  consents to the  amendment of this
Agreement to reflect any such Commitment  Increase.  The Borrower shall give the
Administrative  Agent three Business Days' notice of the Borrower's intention to
increase  the Total  Commitment  pursuant to this  paragraph.  Such notice shall
specify each new financial  institution  to accede to this Agreement as a Lender
or the name of the Lender that has agreed to increase its Commitment  hereunder,
as the case may be, and the amount of the proposed additional  Commitment or the
amount of the proposed increase in an existing  Commitment,  as the case may be.
The  Borrower  shall  also  provide  to the  Administrative  Agent  satisfactory
evidence that all necessary Governmental Approvals and corporate  authorizations
have been  obtained  by the  Borrower in  connection  with  proposed  Commitment
Increase, together with such other information as is reasonably requested by the
Administrative  Agent.  Each  financial  institution  agreeing to accede to this
Agreement as a Lender, and each Lender agreeing to increase its Commitment (each
such financial institution or Lender being an "Acceding Lender"),  shall execute
and deliver to the Administrative  Agent and the Borrower  documentation in form
and substance satisfactory to the Administrative Agent and the Borrower pursuant
to which it becomes a party hereto or increases its Commitment,  as the case may
be, shall deliver to the Administrative  Agent an Administrative  Questionnaire,
and shall purchase from the existing Lenders its  proportionate  share (based on
the amount of its Commitment and the amount of the Total Commitment after giving
effect to the Commitment  Increase) of any Standby Loans outstanding on the date
such Commitment Increase becomes effective.  Upon (x) the execution and delivery
of such  documentation and an amendment to this Agreement that reflects any such
increase in the Total Commitment and such additional or changed  Commitments and
(y) the provision to the Administrative Agent by the Acceding Lender of funds in
an amount  necessary  to purchase  from the existing  Lenders its  proportionate
share  (based  on the  amount  of its  Commitment  and the  amount  of the Total
Commitment after giving effect to the Commitment  Increase) of any Standby Loans
outstanding on the date such  Commitment  Increase  becomes  effective,  (i) the
Commitment  Increase  shall become  effective,  (ii) the  financial  institution
agreeing to accede to this Agreement as a Lender shall constitute a Lender under
this  Agreement  with a Commitment as specified  therein,  or, in the case of an
existing Lender agreeing to increase its  Commitment,  such Lender's  Commitment
shall increase as specified therein, and (iii) the Acceding Lender shall acquire
its  proportionate  share  (determined as aforesaid) of any outstanding  Standby
Loans and the rights relating thereto as provided by the Agreement.

     (f) Any changes in the Commitments  pursuant to this Section 2.11  shall be
appropriately recorded by the Administrative Agent in the Register in accordance
with Section 9.04(d).  In addition,  all notices with respect to any such change
shall be maintained by the Administrative Agent with the Register.

     Section 2.12. Prepayment.

     (a) The Borrower  shall have the right at any time and from time to time to
prepay any Standby Borrowing or Eurodollar Competitive Borrowing, in whole or in
part,  upon giving written  notice (or telephone  notice  promptly  confirmed by
written notice) to the Administrative  Agent:  (i) before  11:00 A.M.,  New York
City time,  three Business Days prior to  prepayment,  in the case of Eurodollar
Loans, and (ii) before 11:00 A.M., New York City time, on the day of prepayment,
in the case of ABR Loans; provided,  however, that each partial prepayment shall
be in an amount which is an integral  multiple of  $1,000,000  and not less than
$5,000,000.  The  Borrower  shall not have the right to  prepay  any Fixed  Rate
Competitive Borrowing.

                                       25
<PAGE>

     (b) On the date of any termination or reduction of the Commitments pursuant
to Section 2.11  (other than  subsection (b)  thereof) or  Section 2.13(f),  the
Borrower  shall  pay or  prepay so much of the  Standby  Borrowings  as shall be
necessary in order that the aggregate  principal amount of the Competitive Loans
and Standby Loans  outstanding will not exceed the Total Commitment after giving
effect to such  termination  or reduction.  In the event that the Borrower makes
the Term  Election,  the Borrower  shall pay or prepay on the  Revolving  Period
Maturity  Date so much of the Standby  Borrowings as shall be necessary in order
that the aggregate  principal  amount of the Standby Loans  outstanding will not
exceed the amount of the Standby Loans subject to the Term Election.

     (c) The Borrower shall, from time to time, prepay Standby  Borrowings in an
amount equal to the Net Cash Proceeds received by the Borrower or any Subsidiary
thereof  from any Sale  Transaction,  such  prepayment  to be made on the  tenth
Business Day following the day on which the Borrower or such Subsidiary receives
such  Net  Cash  Proceeds;  provided,  that  (1) the  aggregate  amount  of such
prepayments made pursuant to this subsection (c) shall not exceed $3,700,000,000
plus the  aggregate  amount of  Commitment  Increases  made  pursuant to Section
2.11(e) minus the aggregate  amount of reductions in the Total  Commitment  made
pursuant to  Section 2.11(a);  (2) no such  prepayment  shall be required to the
extent that any commercial  paper issued by the Borrower prior to its receipt of
such Net Cash Proceeds and supported by the  Commitments  required to be reduced
pursuant to Section 2.11(b) shall be outstanding;  provided,  that prepayment of
such amount shall be required as and when such  commercial  paper  matures;  and
(3) any  prepayment of a Eurodollar  Loan made  pursuant to this  subsection (c)
shall not be required to be made until the end of the Interest Period applicable
to such Eurodollar Loan.

     (d) Each notice of  prepayment  shall specify the  prepayment  date and the
principal amount of each Borrowing (or portion thereof) to be prepaid,  shall be
irrevocable  and shall commit the Borrower to prepay such  Borrowing (or portion
thereof)  by  the  amount  stated  therein  on  the  date  stated  therein.  All
prepayments  under  this  Section 2.12  shall be  subject  to  Section 2.15  but
otherwise  without premium or penalty.  All prepayments  under this Section 2.12
shall be accompanied by accrued  interest on the principal  amount being prepaid
to the date of payment.

     Section 2.13. Reserve Requirements; Change in Circumstances.

     (a) It is understood  that the cost to each Lender of making or maintaining
any of the Eurodollar  Loans may fluctuate as a result of the  applicability  of
reserve  requirements  imposed  by the  Board  at  the  ratios  provided  for in
Regulation  D on the date  hereof.  The  Borrower  agrees  to pay to each of the
Lenders from time to time such amounts as shall be necessary to compensate  such
Lender for the  portion of the cost of making or  maintaining  Eurodollar  Loans
(other  than  Eurodollar  Competitive  Loans)  resulting  from any such  reserve
requirements  provided for in  Regulation D as in effect on the date hereof,  it
being understood that the rates of interest  applicable to Eurodollar Loans have
been  determined on the assumption  that no such reserve  requirements  exist or
will exist and that such rates do not  reflect  costs  imposed on the Lenders in
connection with such reserve requirements.

                                       26
<PAGE>

     (b)  Notwithstanding  any other provision herein, if after the date of this
Agreement  any  change  in  applicable  law or  regulation  (including,  without
limitation,  Regulation D) or in the interpretation or administration thereof by
any Governmental  Authority  charged with the  interpretation  or administration
thereof  (whether  or not  having  the force of law)  shall  change the basis of
taxation  of  payments  to any Lender of the  principal  of or  interest  on any
Eurodollar  Loan or Fixed  Rate  Loan  made by such  Lender or any Fees or other
amounts payable hereunder (other than changes in respect of taxes imposed on the
overall  net income of such  Lender  and  franchise  taxes  imposed on it by the
jurisdiction  in which such Lender has its principal  office or by any political
subdivision  or taxing  authority  therein),  or shall impose,  modify,  or deem
applicable any reserve,  special deposit,  or similar requirement against assets
of,  deposits with or for the account of or credit  extended by such Lender,  or
shall impose on such Lender or the London  interbank  market any other condition
affecting this Agreement or any Eurodollar  Loan or Fixed Rate Loan made by such
Lender,  and the result of any of the foregoing shall be to increase the cost to
such Lender of making or maintaining  any Eurodollar  Loan or Fixed Rate Loan or
to reduce the amount of any sum received or receivable by such Lender  hereunder
(whether of  principal,  interest,  or  otherwise)  by an amount  deemed by such
Lender to be material,  then, to the extent not otherwise being reimbursed under
Section  2.19  hereof,  the  Borrower  will pay to such  Lender upon demand such
additional  amount or amounts as will compensate such Lender for such additional
costs incurred or reduction suffered.  Notwithstanding the foregoing,  no Lender
shall be entitled to request  compensation  under this paragraph with respect to
any Competitive  Loan if it shall have had actual knowledge of the change giving
rise to such request at the time of submission of the  Competitive  Bid pursuant
to which such Competitive Loan shall have been made.

     (c) If any Lender shall have  determined  that the adoption  after the date
hereof of any law, rule, regulation, or guideline regarding capital adequacy, or
any change in any existing law, rule, regulation, or guideline regarding capital
adequacy or in the  interpretation  or administration of any of the foregoing by
any governmental authority,  central bank, or comparable agency charged with the
interpretation  or administration  thereof,  or compliance by any Lender (or any
lending office of such Lender) or any Lender's  holding company with any request
or directive regarding capital adequacy (whether or not having the force of law)
of any such authority, central bank, or comparable agency, has or would have the
effect of reducing the rate of return on such Lender's capital or on the capital
of such Lender's holding company,  if any, as a consequence of this Agreement or
the Loans made by such Lender  pursuant  hereto to a level below that which such
Lender  or such  Lender's  holding  company  could  have  achieved  but for such
adoption,  change,  or  compliance  (taking  into  consideration  such  Lender's
policies  and the  policies of such  Lender's  holding  company  with respect to
capital  adequacy) by an amount deemed by such Lender to be material,  then from
time to time the  Borrower  shall pay to such Lender such  additional  amount or
amounts as will compensate such Lender or such Lender's  holding company for any
such reduction suffered.

     (d) A certificate of a Lender setting forth such amount or amounts as shall
be necessary to compensate  such Lender as specified in  paragraph (a),  (b), or
(c)  above,  as the  case  may  be,  and  all of the  relevant  factors  and the
calculations  supporting  such  amount or  amounts,  shall be  delivered  to the
Borrower and shall be conclusive  absent manifest error.  The Borrower shall pay
each  Lender the amount  shown as due on any such  certificate  delivered  by it
within 10 days after the receipt of the same.

                                       27
<PAGE>

     (e) Notwithstanding  the provisions of subsections (a),  (b) or (c), above,
to the  contrary,  no Lender  shall be entitled to demand  compensation  for any
increased  costs or reduction in amounts  received or receivable or reduction in
return on capital to the extent that such compensation  relates to any period of
time prior to the date upon which such Lender first notified the Borrower of the
occurrence of the event entitling such Lender to such compensation  (unless, and
to the  extent,  that any such  compensation  so  demanded  shall  relate to the
retroactive application of any event so notified to the Borrower required by any
governmental authority, central bank or comparable agency).

     (f) If any Lender shall have delivered a notice or certificate  pursuant to
paragraph (d) above, the Borrower shall have the right, at its own expense, upon
notice to such Lender and the  Administrative  Agent,  to require such Lender to
(i) terminate  its Commitment or  (ii) transfer  and assign without recourse (in
accordance with and subject to the restrictions  contained in Section 9.04)  all
or a portion of its interest,  rights and  obligations  under this  Agreement to
another financial institution which shall assume such obligations; provided that
(A) no such  termination  or assignment  shall  conflict with any law,  rule, or
regulation or order of any  Governmental  Authority and (B) the  Borrower or the
assignee,  as the case may be, shall pay to the affected  Lender in  immediately
available  funds on the date of such  termination or assignment the principal of
and  interest  accrued to the date of payment on the Loans made by it  hereunder
and all other  amounts  accrued for its account or owed to it  hereunder  (other
than any amounts owed to such Lender pursuant to  Section 2.15(c)  in connection
with such principal payment).

     Section 2.14. Change in Legality.

     (a) Notwithstanding any other provision herein, if any change in any law or
regulation  or in  the  interpretation  thereof  by any  governmental  authority
charged with the administration or interpretation thereof shall make it unlawful
for any Lender to make or maintain any Eurodollar  Loan or to give effect to its
obligations as contemplated hereby with respect to any Eurodollar Loan, then, by
written notice to the Borrower and to the Administrative Agent, such Lender may:

          (i) declare that Eurodollar  Loans will not thereafter be made by such
          Lender hereunder, whereupon such Lender shall not submit a Competitive
          Bid in response to a request for Eurodollar  Competitive Loans and any
          request by the Borrower for a Eurodollar  Standby  Borrowing shall, as
          to such  Lender  only,  be deemed a request  for an ABR Loan (or for a
          Conversion  thereto pursuant to Section 2.05)  unless such declaration
          shall be subsequently withdrawn; and

          (ii)  require  that all  outstanding  Eurodollar  Loans  made by it be
          Converted to ABR Loans, in which event all such Eurodollar Loans shall
          be  automatically  Converted to ABR Loans as of the effective  date of
          such notice as provided in paragraph (b) below.

In the event any Lender shall  exercise its rights under (i) or (ii) above,  all
payments and prepayments of principal which would otherwise have been applied to
repay the  Eurodollar  Loans  that  would  have been made by such  Lender or the
Converted  Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting  from the  Conversion of,
such Eurodollar Loans.

                                       28
<PAGE>

          (b) For purposes of this Section 2.14, a notice to the Borrower by any
     Lender shall be effective as to each  Eurodollar  Loan,  if lawful,  on the
     last day of the Interest  Period  currently  applicable to such  Eurodollar
     Loan;  in all other cases such  notice  shall be  effective  on the date of
     receipt by the Borrower.

          Section 2.15. Indemnity.

          The Borrower  shall  indemnify each Lender against any loss or expense
     which such Lender may sustain or incur as a consequence of (a) any  failure
     by the  Borrower  to fulfill  on the date of any  Borrowing  hereunder  the
     applicable  conditions  set forth in  Article IV,  (b) any  failure  by the
     Borrower  to borrow or to  Convert  any Loan  hereunder  after  irrevocable
     notice  of  such  Borrowing  or  Conversion  has  been  given  pursuant  to
     Section 2.03,  2.04 or 2.05, (c) any payment, prepayment or Conversion of a
     Eurodollar  Loan  required  by any other  provision  of this  Agreement  or
     otherwise  made or  deemed  made on a date  other  than the last day of the
     Interest  Period  applicable   thereto,   (d) any  default  in  payment  or
     prepayment  of the  principal  amount  of any Loan or any part  thereof  or
     interest  accrued  thereon,  as and when due and  payable  (at the due date
     thereof, whether by scheduled maturity, acceleration, irrevocable notice of
     prepayment or  otherwise),  or (e) the  occurrence of any Event of Default,
     including,  in each such case, any loss or reasonable  expense sustained or
     incurred  or to be  sustained  or  incurred  in  liquidating  or  employing
     deposits from third parties acquired to effect or maintain such Loan or any
     part thereof as a Eurodollar  Loan.  Such loss or reasonable  expense shall
     include an amount equal to the excess,  if any, as reasonably  demonstrated
     by such Lender,  of (i) its cost of obtaining  the funds for the Loan being
     paid, prepaid,  Converted, or not borrowed (assumed to be the LIBO Rate or,
     in the case of a Fixed Rate Loan,  the fixed  rate of  interest  applicable
     thereto)  for the  period  from the date of such  payment,  prepayment,  or
     failure to borrow to the last day of the Interest Period for such Loan (or,
     in the case of a failure to borrow, the Interest Period for such Loan which
     would have  commenced on the date of such failure) over (ii) the  amount of
     interest (as reasonably demonstrated by such Lender) that would be realized
     by such Lender in reemploying the funds so paid,  prepaid,  or not borrowed
     for such period or Interest  Period,  as the case may be. A certificate  of
     any Lender setting forth the factors and calculations supporting any amount
     or amounts  which such  Lender is  entitled  to  receive  pursuant  to this
     Section shall be delivered to the Borrower no later than 30 days  following
     the  incurrence  of any loss or expense  for which  such  Lender is seeking
     indemnification  under this  Section  2.15 and shall be  conclusive  absent
     manifest error.

          Section 2.16. Pro Rata Treatment.

          Except as required or otherwise permitted under  Sections 2.13(f)  and
     2.14,  each Standby  Borrowing,  each payment or prepayment of principal of
     any Standby Borrowing,  each payment of interest on the Standby Loans, each
     payment of the Facility Fees,  each reduction of the  Commitments  and each
     Conversion of any Borrowing with a Standby  Borrowing of any Type, shall be
     allocated  pro rata among the Lenders in accordance  with their  respective
     Commitments (or, if such Commitments shall have expired or been terminated,
     in accordance with the respective  principal  amounts of their  outstanding
     Standby  Loans).  Each payment of principal  of any  Competitive  Borrowing
     shall be  allocated  pro  rata  among  the  Lenders  participating  in such
     Borrowing in  accordance  with the  respective  principal  amounts of their
     outstanding  Competitive  Loans comprising such Borrowing.  Each payment of
     interest on any Competitive Borrowing shall be allocated pro rata among the
     Lenders  participating  in such Borrowing in accordance with the respective
     amounts of accrued  and unpaid  interest on their  outstanding  Competitive
     Loans comprising such Borrowing.  For purposes of determining the available
     Commitments  of the  Lenders  at any  time,  each  outstanding  Competitive
     Borrowing  shall be deemed to have utilized the  Commitments of the Lenders
     (including  those  Lenders  which shall not have made Loans as part of such
     Competitive   Borrowing)  pro  rata  in  accordance  with  such  respective
     Commitments. Each Lender agrees that, in computing such Lender's portion of
     any Borrowing to be made hereunder,  the  Administrative  Agent may, in its
     discretion,  round each Lender's  percentage of such  Borrowing to the next
     higher or lower whole dollar amount.

                                       29
<PAGE>

          Section 2.17. Sharing of Setoffs.

          Each Lender  agrees that if it shall,  through the exercise of a right
     of banker's lien, setoff, or counterclaim against the Borrower, or pursuant
     to a secured claim under  Section 506 of Title 11 of the United States Code
     or other  security or interest  arising  from,  or in lieu of, such secured
     claim, received by such Lender under any applicable bankruptcy, insolvency,
     or other similar law or otherwise,  or by any other means,  obtain  payment
     (voluntary or  involuntary) in respect of any Standby Loan or Standby Loans
     as a result of which the unpaid  principal  portion of the Standby Loans of
     such Lender shall be proportionately less than the unpaid principal portion
     of the Standby Loans of any other Lender, it shall be deemed simultaneously
     to have purchased from such other Lender at face value,  and shall promptly
     pay to such other Lender the  purchase  price for, a  participation  in the
     Standby Loans of such other Lender,  so that the aggregate unpaid principal
     amount of the Standby Loans and participations in the Standby Loans held by
     each  Lender  shall  be in the  same  proportion  to the  aggregate  unpaid
     principal  amount of all Standby  Loans then  outstanding  as the principal
     amount of its  Standby  Loans  prior to such  exercise  of  banker's  lien,
     setoff,  or counterclaim or other event was to the principal  amount of all
     Standby Loans outstanding prior to such exercise of banker's lien,  setoff,
     or  counterclaim  or  other  event;  provided,  however,  that if any  such
     purchase or purchases or adjustments shall be made pursuant to this Section
     2.17 and the payment  giving rise thereto  shall  thereafter  be recovered,
     such purchase or purchases or adjustments  shall be rescinded to the extent
     of such recovery and the purchase  price or prices or  adjustment  restored
     without  interest.   The  Borrower  expressly  consents  to  the  foregoing
     arrangements  and agrees that, to the maximum extent  permitted by law, any
     Lender  holding a  participation  in a Standby  Loan deemed to have been so
     purchased  may exercise  any and all rights of banker's  lien,  setoff,  or
     counterclaim  with  respect to any and all moneys  owing by the Borrower to
     such Lender by reason thereof as fully as if such Lender had made a Standby
     Loan directly to the Borrower in the amount of such participation.

          Section 2.18. Payments.

          (a) The Borrower  shall make each payment  (including  principal of or
     interest on any Borrowing or any Fees or other amounts) hereunder not later
     than 12:00 noon, New York City time, on the date when due in dollars to the
     Administrative  Agent at its offices at 270 Park Avenue, New York, New York
     10017, in immediately  available  funds. All payments by the Borrower shall
     be made without  deduction  for any  counterclaim,  defense,  recoupment or
     setoff.

          (b)  Whenever any payment  (including  principal of or interest on any
     Borrowing  or any Fees or other  amounts)  hereunder  shall  become due, or
     otherwise  would occur,  on a day that is not a Business  Day, such payment
     may be made on the next succeeding Business Day, and such extension of time
     shall in such case be included in the  computation  of interest or Fees, if
     applicable.

                                       30
<PAGE>

          Section 2.19. Taxes.

          (a) Any and all payments by the Borrower  hereunder  shall be made, in
     accordance with  Section 2.18,  free and clear of and without deduction for
     any and all present or future taxes, levies, imposts, deductions,  charges,
     or withholdings,  and all liabilities with respect thereto, excluding taxes
     imposed on the Administrative Agent's or any Lender's (or any Transferee's)
     net income and franchise taxes imposed on the  Administrative  Agent or any
     Lender (or Transferee) by the United States or any  jurisdiction  under the
     laws of which it is organized  or any  political  subdivision  thereof (all
     such nonexcluded taxes, levies, imposts, deductions,  charges, withholdings
     and liabilities being hereinafter referred to as "Taxes").  If the Borrower
     shall be  required by law to deduct any Taxes from or in respect of any sum
     payable hereunder to the Lenders (or any Transferee) or the  Administrative
     Agent,  (i) the sum payable  shall be increased by the amount  necessary so
     that after making all required deductions  (including deductions applicable
     to  additional  sums  payable  under  this  Section 2.19)  such  Lender (or
     Transferee) or the Administrative  Agent (as the case may be) shall receive
     an amount equal to the sum it would have  received  had no such  deductions
     been made,  (ii) the  Borrower  shall make such  deductions  and  (iii) the
     Borrower  shall  pay  the  full  amount  deducted  to the  relevant  taxing
     authority or other  Governmental  Authority in accordance  with  applicable
     law.  Each Lender party hereto on the date hereof  represents  and warrants
     that no Taxes will be incurred on the date  hereof in  connection  with the
     execution and delivery of this Agreement.

          (b) In  addition,  the  Borrower  agrees to pay any  present or future
     stamp or documentary taxes or any other excise or property taxes,  charges,
     or similar  levies which arise from any payment made  hereunder or from the
     execution, delivery, or registration of, or otherwise with respect to, this
     Agreement  (hereinafter  referred to as "Other  Taxes").  Each Lender party
     hereto on the date hereof  represents and warrants that no Other Taxes will
     be  incurred  on the date  hereof  in  connection  with the  execution  and
     delivery of this Agreement.

          (c) The Borrower will  indemnify each Lender (or  Transferee)  and the
     Administrative  Agent  for  the  full  amount  of  Taxes  and  Other  Taxes
     (including any Taxes or Other Taxes imposed by any  jurisdiction on amounts
     payable under this Section 2.19) paid by such Lender (or Transferee) or the
     Administrative  Agent,  as the case may be,  and any  liability  (including
     penalties,  interest  and  expenses)  arising  therefrom  or  with  respect
     thereto, whether or not such Taxes or Other Taxes were correctly or legally
     asserted by the relevant taxing authority or other Governmental  Authority.
     Payment of such indemnification shall be made within 30 days after the date
     any Lender (or Transferee) or the Administrative Agent, as the case may be,
     makes  written  demand  therefor.  If  a  Lender  (or  Transferee)  or  the
     Administrative  Agent shall  become  aware that it is entitled to receive a
     refund in respect of Taxes of Other  Taxes,  it shall  promptly  notify the
     Borrower of the availability of such refund and shall, within 30 days after
     receipt  of a  request  by the  Borrower,  apply  for  such  refund  at the
     Borrower's  expense.  If any Lender (or  Transferee) or the  Administrative
     Agent  receives a refund in  respect of any Taxes or Other  Taxes for which
     such  Lender  (or  Transferee)  or the  Administrative  Agent has  received
     payment from the Borrower hereunder,  it shall promptly notify the Borrower
     of such  refund and shall,  within 15 days  after  receipt of such  refund,
     repay such refund to the  Borrower,  net of all  out-of-pocket  expenses of
     such  Lender  (or  Transferee)  or the  Administrative  Agent and only with
     interest   received,   if  any,  from  the  relevant  taxing  authority  or
     Governmental  Authority;  provided that the  Borrower,  upon the request of
     such Lender (or Transferee) or the Administrative  Agent,  agrees to return
     such refund (plus penalties, interest, or other charges) to such Lender (or
     Transferee)  or the  Administrative  Agent in the  event  such  Lender  (or
     Transferee) or the Administrative Agent is required to repay such refund.

                                       31
<PAGE>

          (d)  Within 30 days  after the date of any  payment  of Taxes or Other
     Taxes  withheld by the Borrower in respect of any payment to any Lender (or
     Transferee) or the  Administrative  Agent, the Borrower will furnish to the
     Administrative  Agent,  at its  address  referred to in Section  9.01,  the
     original or a certified copy of a receipt evidencing payment thereof.

          (e) Without prejudice to the survival of any other agreement contained
     herein, the agreements and obligations contained in this Section 2.19 shall
     survive the payment in full of the  principal  of and interest on all Loans
     made hereunder.

          (f)  Each  Lender  represents  and  warrants  that  either  (i) it  is
     organized  under the laws of a  jurisdiction  within the  United  States or
     (ii) it has  delivered to the Borrower  and the  Administrative  Agent duly
     completed  copies of such form or forms  prescribed by the Internal Revenue
     Service indicating that such Lender is entitled to receive payments without
     deduction or  withholding  of any United States  federal  income taxes,  as
     permitted by the Code. Each Transferee agrees that, on or prior to the date
     upon which it shall become a party hereto or obtain a participation herein,
     and upon the  reasonable  request  from time to time of the Borrower or the
     Administrative   Agent,   it  will   deliver  to  the   Borrower   and  the
     Administrative  Agent either (A) a statement that it is organized under the
     laws of a  jurisdiction  within the  United  States or  (B) duly  completed
     copies of such form or forms as may from time to time be  prescribed by the
     United States Internal Revenue Service,  indicating that such Transferee is
     entitled to receive payments without deduction or withholding of any United
     States federal income taxes, as permitted by the Code. Each Lender that has
     delivered, and each Transferee that hereafter delivers, to the Borrower and
     the Administrative Agent the form or forms referred to in the two preceding
     sentences   further   undertakes   to  deliver  to  the  Borrower  and  the
     Administrative  Agent,  so far as it may legally do so,  further  copies of
     such form or forms, or successor  applicable form or forms, as the case may
     be, as and when any  previous  form filed by it  hereunder  shall expire or
     shall become  incomplete  or  inaccurate  in any  respect.  Each Lender and
     Transferee  represents  and warrants  that each such form supplied by it to
     the Administrative  Agent and the Borrower pursuant to this subsection (f),
     and not  superseded  by another form  supplied by it, is or will be, as the
     case may be, complete and accurate.

          (g) The Borrower shall not be required to pay any  additional  amounts
     to any Lender (or  Transferee) in respect of United States  withholding tax
     pursuant to  paragraph (a)  above if the obligation to pay such  additional
     amounts  would  not  have  arisen  but for a  failure  by such  Lender  (or
     Transferee) to comply with the provisions of  paragraph (f)  above,  unless
     such failure  results from (i) a change in applicable law,  regulation,  or
     official  interpretation  thereof, or (ii) an amendment,  modification,  or
     revocation of any  applicable  tax treaty or a change in official  position
     regarding the application or interpretation thereof, in each case after the
     date hereof (and, in the case of a Transferee, after the date of assignment
     or transfer); provided, however, that the Borrower shall be required to pay
     those  amounts to any Lender (or  Transferee)  which it was required to pay
     hereunder  prior to the  failure of such Lender (or  Transferee)  to comply
     with the provisions of paragraph (f).

                                       32
<PAGE>

          (h) Any Lender (or Transferee) claiming any additional amounts payable
     pursuant to this Section 2.19 shall use reasonable efforts (consistent with
     legal and  regulatory  restrictions)  to file any  certificate  or document
     requested by the Borrower or to change the  jurisdiction  of its applicable
     lending  office if the  making of such a filing or change  would  avoid the
     need for or reduce  the  amount of any such  additional  amounts  which may
     thereafter accrue and would not, in the sole  determination of such Lender,
     be otherwise disadvantageous to such Lender (or Transferee).

                                  Article III

                         REPRESENTATIONS AND WARRANTIES

          The Borrower represents and warrants to each of the Lenders that:

          Section 3.01. Organization; Powers; Governmental Approvals.

          (a) The Borrower and each  Principal  Subsidiary  (i) is a corporation
     duly organized, validly existing and in good standing under the laws of the
     jurisdiction  of  its  organization,   (ii) has  all  requisite  power  and
     authority  to own its  property  and assets and to carry on its business as
     now conducted and (iii) is  qualified to do business in every  jurisdiction
     where  such  qualification  is  required,  except  where the  failure so to
     qualify would not have a Material Adverse Effect. The Borrower's execution,
     delivery and performance of this Agreement are within its corporate powers,
     have been duly  authorized  by all  necessary  action and do not violate or
     create a default under law, its constituent  documents,  or any contractual
     provision binding upon it. This Agreement  constitutes the legal, valid and
     binding  obligation  of the Borrower  enforceable  against it in accordance
     with its terms (except as such  enforceability may be limited by applicable
     bankruptcy, reorganization, insolvency, moratorium and other laws affecting
     the rights of creditors generally and general principles of equity).

          (b) Except for (i) any Governmental  Approvals  required in connection
     with any Borrowings (such approvals being  "Borrowing  Approvals") and (ii)
     any Governmental Approvals the failure to obtain which could not reasonably
     be expected to result in a Material  Adverse  Effect or affect the validity
     or enforceability of this Agreement, all Governmental Approvals required in
     connection  with  the  execution  and  delivery  by the  Borrower  of  this
     Agreement and the performance by the Borrower of its obligations  hereunder
     have been, and, prior to the time of any Borrowing, all Borrowing Approvals
     will be, duly obtained,  are (or, in the case of Borrowing Approvals,  will
     be) in full force and effect without having been amended or modified in any
     manner  that  may  impair  the  ability  of the  Borrower  to  perform  its
     obligations under this Agreement, and are not (or, in the case of Borrowing
     Approvals,  will not be) the subject of any pending  appeal,  stay or other
     challenge.  No Interest  Period  requested  with  respect to any  Borrowing
     extends beyond the latest date permitted for Borrowings by any Governmental
     Approval then in effect.

                                       33
<PAGE>

          Section 3.02. Financial Statements.

          The  Borrower  has  furnished  to the  Lenders,  for  itself  and  its
     Subsidiaries,  its most recent  filings  with the  Securities  and Exchange
     Commission on Forms 10-K and 10-Q.  Such Forms 10-K and 10-Q do not contain
     any untrue  statement of a material  fact or omit to state a material  fact
     necessary  to make any  statement  therein,  in light of the  circumstances
     under which it was made, not misleading.  Each of the financial  statements
     in such Forms 10-K and 10-Q has been, and each of the financial  statements
     to be furnished  pursuant to Section 5.02 will be,  prepared in  accordance
     with GAAP applied consistently with prior periods, except as therein noted,
     and fairly  presents or will fairly  present in all  material  respects the
     consolidated  financial position of the Borrower and its Subsidiaries as of
     the date thereof and the results of the  operations of the Borrower and its
     Subsidiaries for the period then ended.

          Section 3.03. No Material Adverse Change.

          Since the date of the  Borrower's  most  recent  financial  statements
     contained  in its Annual  Report on  Form 10-K  for the  fiscal  year ended
     December 31, 1999, furnished to the Lenders pursuant to Section 3.02, there
     has been no material  adverse change in, and there has occurred no event or
     condition  which is likely to result in a material  adverse  change in, the
     condition, financial or otherwise, results of operations,  business, assets
     or  operations  of the Borrower and the  Subsidiaries  taken as a whole (it
     being  understood  that the  divestiture  of  Utilities  Assets  shall  not
     constitute such a material adverse change).

          Section 3.04. Title to Properties; Possession Under Leases.

          (a) To the best of the Borrower's knowledge,  each of the Borrower and
     the  Principal  Subsidiaries  has good and  marketable  title  to, or valid
     leasehold  interests in, or other rights to use or occupy, all its material
     properties  and  assets,  except  for minor  defects  in title  that do not
     interfere  with its ability to conduct its business as currently  conducted
     or to utilize such properties and assets for their intended  purposes.  All
     such material properties and assets are free and clear of Liens, other than
     Liens expressly permitted by Section 6.01.

          (b) Each of the Borrower and the Principal  Subsidiaries  has complied
     with all  obligations  under all material leases to which it is a party and
     all such leases are in full force and effect,  except where such failure to
     comply or maintain  such  leases in full force and effect  would not have a
     Material Adverse Effect.  Each of the Borrower and the Subsidiaries  enjoys
     peaceful and undisturbed  possession  under all such material leases except
     where such failure would not have a Material Adverse Effect.

          Section 3.05. Ownership of Subsidiaries.

          The  Borrower  owns,  free and  clear of any Lien  (other  than  Liens
     expressly  permitted by  Section 6.01),  all of the issued and  outstanding
     shares of common stock of each of the Principal Subsidiaries.

                                       34
<PAGE>

          Section 3.06. Litigation; Compliance with Laws.

          (a) There is no  action,  suit,  or  proceeding,  or any  governmental
     investigation or any arbitration, in each case pending or, to the knowledge
     of the Borrower, threatened against the Borrower or any of the Subsidiaries
     or any material  property of any thereof  before any court or arbitrator or
     any  governmental  or  administrative   body,  agency,  or  official  which
     (i) challenges  the validity of this  Agreement or (ii) except as disclosed
     in the  Borrower's  Annual  Report on  Form 10-K  for the fiscal year ended
     December 31,  1999 or the Borrower's Quarterly Reports on Form 10-Q for the
     periods ending March 31, 2000 and June 30, 2000, may reasonably be expected
     to have a Material Adverse Effect.

          (b) Neither the Borrower nor any of the  Subsidiaries  is in violation
     of any  law,  rule,  or  regulation,  or in  default  with  respect  to any
     judgment,  writ, injunction or decree of any Governmental Authority,  where
     such  violation or default could  reasonably be  anticipated to result in a
     Material Adverse Effect.

          (c) Except as set forth in or contemplated by the financial statements
     or other  reports  referred to in  Section 3.02  hereof and which have been
     delivered to the Lenders on or prior to the date hereof,  (i) the  Borrower
     and each of its  Subsidiaries  have complied with all  Environmental  Laws,
     except to the extent that failure to so comply is not reasonably  likely to
     have a Material  Adverse Effect,  (ii) neither  the Borrower nor any of its
     Subsidiaries  has failed to obtain,  maintain  or comply  with any  permit,
     license or other approval under any  Environmental  Law,  except where such
     failure  is not  reasonably  likely  to  have a  Material  Adverse  Effect,
     (iii)neither  the Borrower nor any of its Subsidiaries has received notice
     of any failure to comply with any  Environmental  Law or become  subject to
     any liability  under any  Environmental  Law,  except where such failure or
     liability  is not  reasonably  likely to have a  Material  Adverse  Effect,
     (iv) no  facilities of the Borrower or any of its  Subsidiaries are used to
     manage any  Specified  Substance  in  violation  of any law,  except to the
     extent that such  violations,  individually  or in the  aggregate,  are not
     reasonably  likely to have a Material Adverse Effect,  and (v) the Borrower
     is aware of no events, conditions or circumstances involving any Release of
     a Specified  Substance that is reasonably likely to have a Material Adverse
     Effect.

          Section 3.07. Agreements.

          (a) Neither the Borrower nor any of the Subsidiaries is a party to any
     agreement or instrument or subject to any  corporate  restriction  that has
     resulted,  or could  reasonably  be  anticipated  to result,  in a Material
     Adverse Effect.

          (b) Neither the Borrower nor any of the  Subsidiaries is in default in
     any manner  under any  provision  of any  indenture  or other  agreement or
     instrument  evidencing  Indebtedness,  or any other  material  agreement or
     instrument  to which it is a party or by which it or any of its  properties
     or assets  are or may be bound,  where such  default  could  reasonably  be
     anticipated to result in a Material Adverse Effect.

                                       35
<PAGE>

          Section 3.08. Federal Reserve Regulations.

          No part of the proceeds of the Loans will be used, whether directly or
     indirectly, and whether immediately,  incidentally,  or ultimately, for any
     purpose which entails a violation of, or which is  inconsistent  with,  the
     provisions of the Margin Regulations.

          Section 3.09.  Investment  Company Act; Public Utility Holding Company
     Act.
          Neither the Borrower nor any of the Subsidiaries is (a) an "investment
     company"  as defined in, or subject to  regulation  under,  the  Investment
     Company Act of 1940 or (b) a "holding company" as defined in, or subject to
     regulation under, the Public Utility Holding Company Act of 1935.

          Section 3.10. Use of Proceeds.

          The  Borrower  will use the proceeds of the Loan only for the purposes
     specified in Section 5.05.

          Section 3.11. Tax Returns.

          Each of the  Borrower and the  Subsidiaries  has filed or caused to be
     filed all Federal,  state and local tax returns required to have been filed
     by it and has  paid or  caused  to be paid  all  taxes  shown to be due and
     payable on such returns or on any assessments  received by it, except taxes
     that are being  contested in good faith by appropriate  proceedings and for
     which the Borrower shall have set aside on its books adequate reserves.

          Section 3.12. No Material Misstatements.

          No statement,  information,  report,  financial statement,  exhibit or
     schedule  furnished by or on behalf of the  Borrower to the  Administrative
     Agent or any Lender in connection  with the  syndication  or negotiation of
     this Agreement or included herein or delivered  pursuant hereto  contained,
     contains,   or  will   contain  any  material   misstatement   of  fact  or
     intentionally  omitted,  omits,  or will  omit to state any  material  fact
     necessary to make the statements therein, in the light of the circumstances
     under which they were, are, or will be made, not misleading.

          Section 3.13. Employee Benefit Plans.

          (a)  Each  Plan  is  in  compliance   with  ERISA,   except  for  such
     noncompliance   that  has  not  resulted,   and  could  not  reasonably  be
     anticipated to result, in a Material Adverse Effect.

          (b) No Plan has an accumulated or waived funding deficiency within the
     meaning of Section 412  or  Section 418B  of the Code,  except for any such
     deficiency  that has not resulted,  and could not reasonably be anticipated
     to result, in a Material Adverse Effect.

          (c) No proceedings have been instituted to terminate any Plan,  except
     for such proceedings where the termination of a Plan has not resulted,  and
     could not  reasonably  be  anticipated  to result,  in a  Material  Adverse
     Effect.

                                       36
<PAGE>

          (d) Neither the Borrower nor any  Subsidiary  or ERISA  Affiliate  has
     incurred  any  liability to or on account of a Plan under ERISA (other than
     obligations to make  contributions  in accordance  with such Plan),  and no
     condition  exists  which  presents a material  risk to the  Borrower or any
     Subsidiary of incurring such a liability,  except for such liabilities that
     have not resulted,  and could not reasonably be anticipated to result, in a
     Material Adverse Effect.

          Section 3.14. Insurance.

          Each  of  the  Borrower  and  the  Principal   Subsidiaries  maintains
     insurance with financially sound and reputable insurers, or self-insurance,
     with respect to its properties  and business  against loss or damage of the
     kind  customarily  insured  against by  reputable  companies in the same or
     similar  business  and  of  such  types  and in  such  amounts  (with  such
     deductible  amounts)  as is  customary  for such  companies  under  similar
     circumstances.

          Section 3.15. Acquisitions.

          (a) The consummation by the Borrower of each Acquisition is within its
     corporate powers, has been duly authorized by all necessary action and does
     not violate or create a default under law, its constituent documents or any
     contractual  provision  binding  upon  it or  any  other  Person  or  their
     respective properties.

          (b) The  consummation  by the Borrower of each  Acquisition or portion
     thereof does not require any Governmental  Approval,  or any authorization,
     consent, order, approval,  license, franchise, lease, ruling, tariff, rate,
     permit,  certificate,  exemption of, or filing or  registration  with,  any
     other Person, that is necessary for the consummation of such Acquisition or
     such portion  thereof and that has not been  obtained or will not have been
     obtained  and be in full force and effect at the time such  Acquisition  or
     such portion  thereof is completed.  The Borrower  holds, or will hold upon
     the  completion  of each  Acquisition  or  portion  thereof,  all  permits,
     licenses,  authorizations,   certificates,   exemptions  and  approvals  of
     Governmental  Authorities or other Persons,  including those required under
     Environmental Laws (collectively,  "Permits"), necessary for the use of the
     property acquired as a result of the completion of such Acquisition or such
     portion  thereof,  and all such Permits are, or will be upon the completion
     of each Acquisition or portion thereof, in full force and effect.

          (c) Upon the consummation of each Acquisition or portion thereof,  the
     Borrower shall have good,  valid and marketable  title to the properties so
     acquired,  subject to no Liens except for transfer  restrictions imposed by
     law and  Permitted  Liens.  As used in this  Section,  the term  "Permitted
     Liens"  shall mean Liens  permitted  to exist  pursuant to the terms of the
     definitive contracts governing the relevant Acquisition or portion thereof;
     provided, that the existence of such Liens does not materially detract from
     the value of the acquired properties.

          (d) The financial projections and pro forma financial information that
     assume the  consummation of the  Acquisitions and that are contained in the
     Confidential  Information  Memorandum,  dated September 2000, regarding the
     credit facility to be provided to the Borrower hereunder, as distributed to
     the Administrative Agent and the Lenders,  have been prepared in good faith
     and  based  on  reasonable  assumptions  (it  being  understood  that  such
     projections   and  financial   information   are  subject  to   significant
     uncertainties  and  contingencies,  many of which are beyond the Borrower's
     control,  and that no  assurance  can be given  that such  projections  and
     financial information will be realized).

                                       37
<PAGE>

          (e) At the time of the  consummation  of any  Acquisition  or  portion
     thereof,  (i)  there  will  be  no  material  action,   suit,   proceeding,
     governmental  investigation or arbitration  pending against the Borrower or
     any seller of the property that is the subject of such  Acquisition or such
     portion  thereof  before any court or  arbitrator  or any  governmental  or
     administrative  body, agency, or official that seeks to question,  delay or
     prevent the consummation of such  Acquisition or such portion thereof,  and
     (ii)  neither  the  Borrower  nor any  seller of the  property  that is the
     subject of such  Acquisition or such portion thereof will be subject to any
     material order of any Governmental Authority that seeks to question,  delay
     or prevent the consummation of such Acquisition or such portion thereof.

                                   Article IV

                              CONDITIONS OF LENDING

          Section 4.01. Each Borrowing.

          The  obligation  of each Lender to make a Loan on the  occasion of any
     Borrowing, including any Conversion pursuant to Section 2.05, is subject to
     the satisfaction of the following conditions:

          (a) The  Administrative  Agent  shall  have  received a notice of such
     Borrowing as required by Section2.03, 2.04 or 2.05, as applicable;

          (b) The representations and warranties set forth in ArticleIII hereof
     (except,  in the case of a  Conversion,  the  representations  set forth in
     Sections 3.03  and  3.06(a))  shall be true  and  correct  in all  material
     respects  on and as of the date of such  Borrowing  with the same effect as
     though   made  on  and  as  of  such  date,   except  to  the  extent  such
     representations and warranties expressly relate to an earlier date;

          (c) The  Borrower  shall be in  compliance  with all of the  terms and
     provisions set forth herein on its part to be observed or performed, and at
     the time of, and immediately  after such Borrowing,  no Event of Default or
     Default shall have occurred and be continuing; and

          (d) If the  proceeds of such  Borrowing  are to be used to finance any
     Acquisition or portion  thereof,  no default or failure in the satisfaction
     of a condition  to such  Acquisition  or such  portion  thereof  shall have
     occurred and be continuing  under the definitive  contracts  governing such
     Acquisition  or such  portion  thereof,  if the  effect of such  default or
     failure would be to materially increase the aggregate purchase price of the
     assets subject of such  Acquisition  or such portion  thereof or materially
     decrease the  aggregate  value of such  assets,  without the consent of the
     Administrative Agent.

          Each  Borrowing  shall be deemed to  constitute a  representation  and
     warranty by the  Borrower on the date of such  Borrowing  as to the matters
     specified  in   paragraphs (b),   (c)  and  (if  applicable)  (d)  of  this
     Section 4.01.

                                       38
<PAGE>

          Section 4.02. Effective Date.

          The  obligations  of the  Lenders  to make Loans  hereunder  shall not
     become  effective until the date on which each of the following  conditions
     is satisfied (or waived in accordance with Section 9.08):

          (a) The Borrower shall have entered into definitive  purchase and sale
     contracts with respect to the Acquisitions, and the Borrower shall not have
     agreed  to any  modification  of  such  contracts  since  the  date of this
     Agreement without the consent of the Administrative  Agent if the effect of
     such modification  would be to materially  increase the aggregate  purchase
     price of the assets subject of the Acquisitions or materially  decrease the
     aggregate value of such assets.

          (b) The  Administrative  Agent shall have received a favorable written
     opinion of the general  counsel of the Borrower,  dated the Effective  Date
     and addressed to the Lenders,  to the effect set forth in Exhibit D hereto,
     and the Borrower  hereby  instructs such counsel to deliver such opinion to
     the Administrative Agent;

          (c) All legal matters  incident to this  Agreement and the  borrowings
     hereunder  shall  be  satisfactory  to the  Administrative  Agent  and  the
     Lenders;

          (d) The  Administrative  Agent shall have  received  (i) a copy of the
     certificate or articles of incorporation, including all amendments thereto,
     of the Borrower, certified as of a recent date by the Secretary of State of
     the state of its organization, and a certificate as to the good standing of
     the Borrower as of a recent  date,  from such  Secretary  of State;  (ii) a
     certificate  of the Secretary or Assistant  Secretary of the Borrower dated
     the Effective Date and certifying  (A) that  attached thereto is a true and
     complete  copy of the by-laws of the Borrower as in effect on the Effective
     Date and at all  times  since a date  prior to the date of the  resolutions
     described in  clause (B)  below,  (B) that  attached  thereto is a true and
     complete copy of resolutions  duly adopted by the Board of Directors of the
     Borrower  authorizing  the  execution,  delivery  and  performance  of this
     Agreement and the borrowings hereunder,  and that such resolutions have not
     been  modified,  rescinded,  or amended  and are in full force and  effect,
     (C) that the certificate or articles of  incorporation of the Borrower have
     not been amended since the date of the last amendment  thereto shown on the
     certificate of good standing  furnished  pursuant to clause (i)  above, and
     (D) as to the incumbency and specimen  signature of each officer  executing
     this  Agreement or any other document  delivered in connection  herewith on
     behalf of the Borrower;  (iii) a  certificate of another  officer as to the
     incumbency and specimen  signature of the Secretary or Assistant  Secretary
     executing  the  certificate  pursuant  to (ii) above;  (iv) an  irrevocable
     notice from the Borrower  requesting  termination of the "Total Commitment"
     under the Existing Facility  effective  automatically on the Effective Date
     and (v) such other documents as the Administrative Agent or the Lenders may
     reasonably request;

          (e) The Administrative Agent shall have received a certificate,  dated
     the  Effective  Date and signed by a  Financial  Officer  of the  Borrower,
     confirming   compliance   with  the  conditions   precedent  set  forth  in
     paragraphs (b) and (c) of Section 4.01 and paragraph (a) of this Section;

                                       39
<PAGE>

          (f) The  Administrative  Agent shall have  received all Fees and other
     amounts due and payable on or prior to the Effective Date;

          (g) All "Commitments" (as defined in the Existing  Facility) under the
     Existing  Facility shall have been  terminated in accordance with the terms
     thereof and all "Loans" (as defined in the Existing  Facility)  outstanding
     thereunder shall have been repaid or prepaid together with accrued interest
     thereon and all other  amounts  payable to the "Lenders" (as defined in the
     Existing Facility) under the Existing Facility; and

          (h) The Administrative Agent shall have received satisfactory evidence
     that the  commercial  paper of the Borrower is rated at least A2 by S&P and
     P2 by Moody's.

                                   Article V

                              AFFIRMATIVE COVENANTS

          The Borrower  covenants and agrees with the  Administrative  Agent and
     each Lender that, so long as this  Agreement  shall remain in effect or the
     principal of or interest on any Loan (or any portion thereof), or any other
     expenses or amounts payable hereunder, shall be unpaid, the Borrower will:

          Section 5.01. Existence; Businesses and Properties.

          (a) Preserve and maintain, cause each of the Principal Subsidiaries to
     preserve  and  maintain,  and cause each other  Subsidiary  to preserve and
     maintain (where the failure by any such other Subsidiary to so preserve and
     maintain would likely result in a Material Adverse  Effect),  its corporate
     existence,  rights and franchises,  provided,  however,  that the corporate
     existence of any Principal Subsidiary may be terminated if such termination
     is not disadvantageous to the Administrative Agent or any Lender;

          (b) continue to own all of the  outstanding  shares of common stock of
     each Principal Subsidiary;

          (c)  comply,  and cause each of the  Subsidiaries  to  comply,  in all
     material respects, with all applicable laws, rules, regulations and orders,
     including, without limitation, all Environmental Laws;

          (d) pay, and cause each of the  Subsidiaries  to pay,  before any such
     amounts become  delinquent,  (i) all taxes,  assessments  and  governmental
     charges  imposed  upon  it  or  upon  its  property,  and  (ii) all  claims
     (including without limitation,  claims for labor,  materials,  supplies, or
     services) which might, if unpaid, become a Lien upon its property,  unless,
     in each case,  the  validity  or amount  thereof is being  disputed in good
     faith,  and the  Borrower has  maintained  adequate  reserves  with respect
     thereto;

          (e) keep, and cause each of the Subsidiaries to keep,  proper books of
     record  and  account,  containing  complete  and  accurate  entries  of all
     financial and business transactions of the Borrower and such Subsidiary;

                                       40
<PAGE>

          (f)  continue  to carry on, and cause  each  Principal  Subsidiary  to
     continue  to carry  on,  substantially  the same  type of  business  as the
     Borrower or such Principal  Subsidiary  conducted as of the date hereof and
     business  reasonably  related thereto,  except for changes in such business
     that result from the sale of Utilities  Assets and the  consummation of the
     Acquisitions; and

          (g)  maintain or cause to be  maintained  insurance  with  financially
     sound and  reputable  insurers,  or  self-insurance,  with  respect  to its
     properties and business and the properties and business of the Subsidiaries
     against  loss  or  damage  of the  kinds  customarily  insured  against  by
     reputable companies in the same or similar businesses, such insurance to be
     of such types and in such  amounts  (with such  deductible  amounts)  as is
     customary for such companies under similar circumstances;

          provided, however, that the foregoing shall not limit the right of the
     Borrower  or any of its  Subsidiaries  to  engage  in any  transaction  not
     otherwise prohibited by Section 6.02, 6.03 or 6.04.

          Section 5.02. Financial Statements, Reports, etc.

          In the case of the Borrower,  furnish to the Administrative  Agent and
     each Lender:

          (a) as soon as  available  and in any event  within 110 days after the
     end of each  fiscal  year,  consolidated  balance  sheets  and the  related
     statements  of income and cash flows of the Borrower  and its  Subsidiaries
     (the Borrower and its Subsidiaries  being  collectively  referred to as the
     "Companies") as of the close of such fiscal year (which  requirement  shall
     be deemed  satisfied by the  delivery of the  Borrower's  Annual  Report on
     Form 10-K (or any successor form) for such year),  all audited by KPMG Peat
     Marwick or other  independent  public  accountants  of recognized  national
     standing and  accompanied  by an opinion of such  accountants to the effect
     that such consolidated  financial statements fairly present in all material
     respects the financial condition and results of operations of the Companies
     on a consolidated basis in accordance with GAAP consistently applied;

          (b)  within 65 days  after the end of each of the first  three  fiscal
     quarters  of each  fiscal  year,  consolidated  balance  sheets and related
     statements  of income  and cash flows of the  Companies  as of the close of
     such fiscal quarter and the then elapsed  portion of the fiscal year (which
     requirement  shall be deemed  satisfied by the  delivery of the  Borrower's
     Quarterly  Report on Form 10-Q (or any successor  form) for such  quarter),
     each  certified by a Financial  Officer as fairly  presenting the financial
     condition  and results of  operations  of the  Companies on a  consolidated
     basis in  accordance  with GAAP  consistently  applied,  subject  to normal
     year-end audit adjustments;

          (c)  promptly  upon the  mailing  or  filing  thereof,  copies  of all
     financial statements, reports and proxy statements mailed to the Borrower's
     public shareholders,  and copies of all registration statements (other than
     those on  Form S-8)  and  Form 8-K's  (to the extent  that such  Form 8-K's
     disclose  actual or  potential  adverse  developments  with  respect to the
     Borrower or any of its Subsidiaries that constitute, or could reasonably be
     anticipated  to  constitute,  a  Material  Adverse  Effect)  filed with the
     Securities  and  Exchange  Commission  (or any  successor  thereto)  or any
     national securities exchange;

                                       41
<PAGE>

          (d) prompt  notice of any  reduction in the credit rating given to the
     Borrower by S&P or Moody's;

          (e) promptly  after (i) the  occurrence  thereof,  notice of any ERISA
     Termination Event or "prohibited  transaction",  as such term is defined in
     Section 4975 of the Code,  with respect to any Plan that results,  or could
     reasonably be anticipated to result,  in a Material  Adverse Effect,  which
     notice  shall  specify  the  nature  thereof  and the  Borrower's  proposed
     response thereto, and (ii) actual  knowledge thereof,  copies of any notice
     of  PBGC's  intention  to  terminate  or to  have a  trustee  appointed  to
     administer any Plan; and

          (f) promptly, from time to time, such other information, regarding its
     operations,  business affairs and financial  condition,  or compliance with
     the terms of this Agreement,  as the Administrative Agent or any Lender may
     reasonably request.

          Section 5.03. Litigation and Other Notices.

          Furnish to the  Administrative  Agent and each Lender  prompt  written
     notice of the following:

          (a) any Event of Default or Default,  specifying the nature and extent
     thereof  and the  corrective  action  (if any)  proposed  to be taken  with
     respect thereto;

          (b) the filing or commencement  of, or any written notice of intention
     of any Person to file or commence, any action, suit or proceeding,  whether
     at law or in equity or by or before any Governmental Authority, against the
     Borrower  or any of the  Subsidiaries  which  is  reasonably  likely  to be
     adversely determined and which, if adversely  determined,  could reasonably
     be anticipated to result in a Material Adverse Effect;

          (c) any  development  with respect to the  Borrower or any  Subsidiary
     that has resulted in, or could  reasonably be  anticipated  to result in, a
     Material Adverse Effect; and

          (d) its receipt of any Net Cash Proceeds from any Sale Transaction.

          Section 5.04. Maintaining Records.

          Maintain  all  financial  records in  accordance  with GAAP and,  upon
     reasonable  notice,  permit any Lender to visit and inspect  the  financial
     records of the Borrower at  reasonable  times and as often as requested and
     to make extracts from and copies of such financial records,  and permit any
     representatives  designated by any Lender to discuss the affairs,  finances
     and condition of the Borrower with the  appropriate  officers  thereof and,
     with the Borrower's consent (which shall not be unreasonably withheld), the
     independent accountants therefor;  provided,  however, that if the Borrower
     shall so require,  a single  representative  shall be  appointed by Lenders
     holding at least 50% of the aggregate  outstanding principal balance of the
     Loans to exercise the rights granted under this Section 5.04.

                                       42
<PAGE>

          Section 5.05. Use of Proceeds.

          Use the  proceeds of the Loans only for the  purposes set forth in the
     preamble of this Agreement;  provided, however, that no such proceeds shall
     be used directly or indirectly in connection with any Hostile Acquisition.

                                   Article VI

                               NEGATIVE COVENANTS

          The   Borrower   covenants   and  agrees  with  each  Lender  and  the
     Administrative Agent that, so long as this Agreement shall remain in effect
     or the  principal of or interest on any Loan (or any portion  thereof),  or
     any other expenses or amounts payable  hereunder,  shall be unpaid, it will
     not:

          Section 6.01. Liens.

          Create,  incur,  assume,  or  suffer to  exist,  or permit  any of the
     Principal  Subsidiaries to create,  incur,  assume, or suffer to exist, any
     Lien on any of its property  now owned or hereafter  acquired to secure any
     Indebtedness of the Borrower or any such Principal  Subsidiary,  other than
     (a) Liens  incurred or deposits made in the ordinary  course of business to
     secure surety and appeal  bonds,  leases,  return-of-money  bonds and other
     similar  obligations  (exclusive of  obligations of the payment of borrowed
     money);  (b) Liens  created under or in connection  with the First Mortgage
     Bond Indentures or any other indentures  governing the issuance of mortgage
     bonds by the  Borrower;  (c)  pledges or  deposits  to secure  the  utility
     obligations  of the Borrower  incurred in the ordinary  course of business;
     (d) Liens  upon or in property  now owned or  hereafter  acquired to secure
     Indebtedness  incurred solely for the purpose of financing the acquisition,
     construction   or   improvement   of  any  property,   provided  that  such
     Indebtedness  shall not exceed the fair market value of the property  being
     acquired, constructed or improved; (e) Liens on the assets of any Principal
     Subsidiary to secure the repayment of project  financing for such Principal
     Subsidiary;  (f) Liens on the assets of any Person  merged or  consolidated
     with  or  into  (in  accordance  with  Section 6.04)  the  Borrower  or any
     Principal  Subsidiary  that were in  effect  at the time of such  merger or
     consolidation;  and (g) Liens  securing  Indebtedness of the Borrower or of
     any Principal Subsidiary to the Rural Electrification  Administration,  the
     Rural  Utilities  Service,  the Rural Telephone Bank or the Rural Telephone
     Finance  Corporation  (or any  successor  to any  such  agency);  provided,
     however,  that the Borrower or any Principal Subsidiary may create,  incur,
     assume or suffer to exist other Liens (in addition to Liens excepted by the
     foregoing  clauses (a)  through  (g)) on its  assets so long as the  assets
     subject to such Liens do not  represent in the  aggregate  more than 20% of
     the Borrower's Consolidated Tangible Assets.

          Section 6.02. Ownership of the Principal Subsidiaries.

          Sell,  assign,  pledge, or otherwise transfer or dispose of any shares
     of common stock,  voting stock, or stock  convertible into voting or common
     stock of any Principal Subsidiary,  except to another Subsidiary and except
     to the extent the assets of such Principal  Subsidiary  consist entirely of
     Utilities Assets at the time such transaction is consummated.

                                       43
<PAGE>

          Section 6.03. Asset Sales.

          Permit any Principal  Subsidiary to sell, assign, or otherwise dispose
     of assets  (whether in one  transaction  or a series of  transactions),  if
     after giving effect to such  transaction,  such Principal  Subsidiary  will
     have disposed of, in the aggregate,  assets  representing  more than 25% of
     such Principal  Subsidiary's  aggregate  Consolidated Tangible Assets as of
     the date upon which such  Principal  Subsidiary  first  became a  Principal
     Subsidiary;  provided that (i) any Principal Subsidiary may transfer assets
     representing  up  to  100%  of  such  Principal  Subsidiary's  Consolidated
     Tangible  Assets to any other  Subsidiary or to the Borrower,  and (ii) any
     Subsidiary may dispose of its Utilities Assets.

          Section 6.04. Mergers.

          Merge or  consolidate  with,  or sell,  assign,  lease,  or  otherwise
     dispose of (whether in one transaction or a series of transactions)  all or
     substantially all of its assets (whether now owned or hereafter  acquired),
     except  for  Utilities  Assets,  to any  Person,  or permit  any  Principal
     Subsidiary to do so, except that any  Subsidiary may merge into or, subject
     to  Section 6.03,  transfer assets to the Borrower or any other  Subsidiary
     and the  Borrower  may merge with any Person;  provided  that,  immediately
     thereafter  and after  giving  effect  thereto,  no event shall occur or be
     continuing  which  constitutes an Event of Default or a Default and, in the
     case of any such  merger  to which  the  Borrower  is a party,  either  the
     Borrower is the surviving  corporation or the surviving  entity (if not the
     Borrower) has a consolidated  net worth (as  determined in accordance  with
     GAAP)  immediately  subsequent  to  such  merger  at  least  equal  to  the
     Consolidated Net Worth of the Borrower immediately prior to such merger and
     expressly  assumes the  obligations  of the Borrower  hereunder;  provided,
     however, that,  notwithstanding the foregoing,  the Borrower and any of the
     Principal  Subsidiaries  may sell  assets  in the  ordinary  course  of its
     business  and may  sell  or  otherwise  dispose  of  worn  out or  obsolete
     equipment on a basis consistent with good business practices.

          Section 6.05. Restrictions on Dividends.

          Enter into or permit  any  Principal  Subsidiary  to enter  into,  any
     contract or agreement (other than with a governmental  regulatory authority
     having  jurisdiction  over  the  Borrower  or  such  Principal  Subsidiary)
     restricting  the ability of such  Principal  Subsidiary to pay dividends or
     make  distributions  to the  Borrower in any manner  that would  impair the
     ability  of the  Borrower  to  meet  its  present  and  future  obligations
     hereunder. The Secretary of the Borrower or another officer of the Borrower
     satisfactory  to the  Administrative  Agent shall,  prior to entry into any
     contract or  agreement  that could  restrict  the ability of any  Principal
     Subsidiary to pay dividends or make distributions to the Borrower,  deliver
     to the Lenders a certificate  certifying (a) to the absence of any Event of
     Default  or  Default  after  giving  effect to the entry by such  Principal
     Subsidiary  into such contract or agreement,  and (b) that such contract or
     agreement  will not impair the ability of the  Borrower to meet its present
     and future obligations hereunder.

          Section 6.06. Transactions with Affiliates.

          Sell or transfer any property or assets to, or purchase or acquire any
     property or assets  from,  or  otherwise  engage in any other  transactions
     with, any of its Affiliates,  except that as long as no Default or Event of
     Default  shall  have  occurred  and  be  continuing,  the  Borrower  or any
     Subsidiary  may  engage  in any of the  foregoing  transactions  (i) in the
     ordinary  course of business at prices and on terms and conditions not less
     favorable to the Borrower or such  Subsidiary  than could be obtained on an
     arm's-length  basis from unrelated third parties,  (ii) as otherwise may be
     required by any Federal or state Governmental  Authority,  or (iii) so long
     as such transactions are not materially disadvantageous to the Borrower.

                                       44
<PAGE>

          Section 6.07. Minimum Consolidated Net Worth.

          Permit  its  Consolidated  Net  Worth  at any  time  to be  less  than
     $1,500,000,000.

                                  Article VII

                                EVENTS OF DEFAULT

          In case of the  happening of any of the following  events  ("Events of
     Default"):

          (a)  any  representation  or  warranty  made or  deemed  made in or in
     connection  with  this  Agreement  or  the  Borrowings  hereunder,  or  any
     representation,  warranty,  statement,  or  information  contained  in  any
     written  report,  certificate,  financial  statement,  or other  instrument
     furnished in connection with or pursuant to this Agreement,  shall prove to
     have been false or misleading in any material respect when so made,  deemed
     made, or furnished;

          (b) default  shall be made in the payment of any principal of any Loan
     (or any portion thereof) when and as the same shall become due and payable,
     whether  at the due  date  thereof  or at a date  fixed  or for  prepayment
     thereof or by acceleration thereof or otherwise;

          (c) default  shall be made in the payment of any  interest on any Loan
     (or any  portion  thereof)  or any Fee or any other  amount  (other than an
     amount referred to in (b) above) due hereunder,  when and as the same shall
     become due and payable,  and such default shall  continue  unremedied for a
     period of five Business Days;

          (d) default shall be made in the due  observance or performance of any
     covenant,   condition,   or  agreement   contained  in  Section 5.01(f)  or
     Section 5.05 or in Article VI;

          (e) default shall be made in the due  observance or performance of any
     covenant,  condition,  or  agreement  contained  herein  (other  than those
     specified  in (b),  (c),  or (d) above)  and such  default  shall  continue
     unremedied  for a period of 30 days  after the  earlier to occur of (i) the
     Borrower obtaining  knowledge thereof and (ii) the date that written notice
     thereof shall have been given to the Borrower by the  Administrative  Agent
     or any Lender;

          (f) an  involuntary  proceeding  shall be commenced or an  involuntary
     petition  shall  be  filed in a court  of  competent  jurisdiction  seeking
     (i) relief in respect of the Borrower or any Principal Subsidiary,  or of a
     substantial  part of the  property or assets of the Borrower or a Principal
     Subsidiary, under Title 11 of the United States Code, as now constituted or
     hereafter  amended,  or any other Federal or state bankruptcy,  insolvency,
     receivership,  or similar law, (ii) the appointment of a receiver, trustee,
     custodian, sequestrator,  conservator, or similar official for the Borrower
     or any Principal  Subsidiary  or for a substantial  part of the property or
     assets of the Borrower or a Principal  Subsidiary,  or (iii) the winding-up
     or  liquidation  of the  Borrower  or any  Principal  Subsidiary;  and such
     proceeding or petition shall continue  undismissed  for 60 days or an order
     or decree approving or ordering any of the foregoing shall be entered;

                                       45
<PAGE>

          (g) the Borrower or any  Principal  Subsidiary  shall  (i) voluntarily
     commence any proceeding or file any petition  seeking relief under Title 11
     of the United States Code, as now constituted or hereafter amended,  or any
     other Federal or state  bankruptcy,  insolvency,  receivership,  or similar
     law, (ii) consent to the institution of, or fail to contest in a timely and
     appropriate  manner, any proceeding or the filing of any petition described
     in (f) above,  (iii) apply for or consent to the appointment of a receiver,
     trustee, custodian, sequestrator,  conservator, or similar official for the
     Borrower  or any  Principal  Subsidiary  or for a  substantial  part of the
     property or assets of the Borrower or any Principal  Subsidiary,  (iv) file
     an answer admitting the material allegations of a petition filed against it
     in any such  proceeding,  (v) make a general  assignment for the benefit of
     creditors,  (vi) become  unable,  admit in writing its  inability,  or fail
     generally to pay its debts as they become due, or (vii) take any action for
     the purpose of effecting any of the foregoing;

          (h) the  Borrower  or any  Principal  Subsidiary,  as the case may be,
     fails to pay when due, or within any grace period applicable thereto by the
     terms  thereof,  any other  Indebtedness  of the Borrower or any  Principal
     Subsidiary aggregating $50,000,000 or more;

          (i) the Borrower or any Principal  Subsidiary shall fail to observe or
     perform any  covenant or  agreement  contained  in any single  agreement or
     instrument relating to any Indebtedness in excess of (i) $75,000,000 in the
     aggregate,  with respect to any Indebtedness  issued on a tax-exempt basis,
     and   (ii) $50,000,000  in  the  aggregate,   with  respect  to  all  other
     Indebtedness, in each case within any applicable grace period, or any other
     event  shall  occur if the  effect  of such  failure  or other  event is to
     accelerate,  or to  permit  the  holder of such  Indebtedness  or any other
     Person  to  accelerate,  the  maturity  of such  Indebtedness;  or any such
     Indebtedness  shall be  required  to be prepaid  (other than by a regularly
     scheduled  required  prepayment  or the  exercise  by the  Borrower or such
     Principal Subsidiary of its right to make a voluntary  prepayment) in whole
     or in part prior to its stated maturity;

          (j) a  judgment  or  order  for the  payment  of money  in  excess  of
     $50,000,000 and having a Material  Adverse Effect shall be rendered against
     the Borrower or any of the  Subsidiaries  and such  judgment or order shall
     continue  unsatisfied (in the case of a money judgment) and in effect for a
     period of 30 days during which execution shall not be effectively stayed or
     deferred (whether by action of a court, by agreement, or otherwise);

          (k) a Plan  shall  fail  to  maintain  the  minimum  funding  standard
     required  by  Section 412(a)  of the Code for any plan  year or a waiver of
     such  standard is sought or granted under  Section 412(d),  or a Plan is or
     shall have been terminated or the subject of termination  proceedings under
     ERISA, or the Borrower or an ERISA Affiliate has incurred a liability to or
     on account of a Plan under Section 4062, 4063, 4064, 4201 or 4204 of ERISA,
     and there  shall  result  from any such event or events a Material  Adverse
     Effect; and

          (l) there shall have occurred a Change in Control;

                                       46
<PAGE>

          then, and in every such event (other than an event with respect to the
     Borrower  described  in  paragraph (f)  or (g)  above),  and  at  any  time
     thereafter during the continuance of such event, the Administrative  Agent,
     at the request of the Required  Lenders,  shall, by notice to the Borrower,
     take  either or both of the  following  actions,  at the same or  different
     times:  (i) terminate  forthwith the Commitments and (ii) declare the Loans
     then  outstanding  to be  forthwith  due and  payable  in whole or in part,
     whereupon  the  principal  of the Loans so declared to be due and  payable,
     together with accrued  interest thereon and any unpaid accrued Fees and all
     other liabilities of the Borrower accrued hereunder, shall become forthwith
     due and payable, without presentment,  demand, protest, or any other notice
     of any kind,  all of which are  hereby  expressly  waived by the  Borrower,
     anything contained herein to the contrary notwithstanding; and in any event
     with respect to the Borrower  described in  paragraph (f) or (g) above, the
     Commitments  shall  automatically  terminate and the principal of the Loans
     then  outstanding,  together with accrued  interest  thereon and any unpaid
     accrued Fees and all other  liabilities of the Borrower accrued  hereunder,
     shall automatically become due and payable,  without  presentment,  demand,
     protest, or any other notice of any kind, all of which are hereby expressly
     waived  by  the  Borrower,   anything  contained  herein  to  the  contrary
     notwithstanding.

                                  Article VIII

                            THE ADMINISTRATIVE AGENT

          In order to expedite the transactions  contemplated by this Agreement,
     The Chase Manhattan Bank is hereby appointed to act as Administrative Agent
     on behalf of the Lenders.  Each of the Lenders,  and each Transferee by its
     agreement to be bound hereby,  irrevocably  authorizes  the  Administrative
     Agent to take such  actions on behalf of such Lender or  Transferee  and to
     exercise such powers as are  specifically  delegated to the  Administrative
     Agent by the terms and  provisions  hereof,  together with such actions and
     powers as are reasonably  incidental thereto.  The Administrative  Agent is
     hereby  expressly  authorized by the Lenders,  without hereby  limiting any
     implied authority,  (a) to receive on behalf of the Lenders all payments of
     principal  of and  interest  on the Loans and all other  amounts due to the
     Lenders  hereunder,  and promptly to  distribute  to each Lender its proper
     share of each payment so received; (b) to promptly give notice on behalf of
     each of the Lenders to the  Borrower of any Event of Default  specified  in
     this  Agreement  of which the  Administrative  Agent has  actual  knowledge
     acquired in connection with its agency hereunder;  and (c) to distribute to
     each Lender copies of all notices, financial statements and other materials
     delivered  by the  Borrower  pursuant to this  Agreement as received by the
     Administrative Agent.

          Neither the Administrative  Agent nor any of its directors,  officers,
     employees,  or  agents  shall be  liable  as such for any  action  taken or
     omitted  by any of them,  except  for its or his own  gross  negligence  or
     willful  misconduct,  or be  responsible  for any statement,  warranty,  or
     representation  herein  or  the  contents  of  any  document  delivered  in
     connection  herewith,  or be required to  ascertain  or to make any inquiry
     concerning  the  performance  or  observance  by the Borrower of any of the
     terms,   conditions,   covenants,   or  agreements  contained  herein.  The
     Administrative  Agent  shall  not  be  responsible  to the  Lenders  or any
     Transferee for the due execution, genuineness, validity, enforceability, or
     effectiveness of this Agreement or any other instruments or agreements. The
     Administrative  Agent  may deem and treat  each  Lender  party  hereto as a
     "Lender" hereunder and for all purposes hereof until it shall have received
     notice, given as provided herein, of the assignment of all of such Lender's
     rights and obligations  hereunder.  The  Administrative  Agent shall in all
     cases  be  fully  protected  in  acting,  or  refraining  from  acting,  in
     accordance  with written  instructions  signed by the Required  Lenders (or
     such other number of Lenders as is expressly  required  hereby with respect
     to such action or inaction) and, except as otherwise  specifically provided
     herein, such instructions and any action or inaction pursuant thereto shall
     be binding on all the Lenders and each Transferee. The Administrative Agent
     shall, in the absence of knowledge to the contrary,  be entitled to rely on
     any  instrument or document  believed by it in good faith to be genuine and
     correct  and to have been  signed or sent by the proper  Person or Persons.
     Neither  the  Administrative  Agent  nor  any of its  directors,  officers,
     employees,  or agents  shall have any  responsibility  to the  Borrower  on
     account of the failure of or delay in  performance  or breach by any Lender
     of any of its  obligations  hereunder  or to any  Lender on  account of the
     failure  of or delay in  performance  or breach by any other  Lender or the
     Borrower of any of their respective  obligations hereunder or in connection
     herewith. The Administrative Agent may execute any and all duties hereunder
     by or through  agents or  employees  and shall be entitled to rely upon the
     advice of legal counsel  selected by it with respect to all matters arising
     hereunder  and shall not be liable for any action taken or suffered in good
     faith by it in accordance with the advice of such counsel.

                                       47
<PAGE>

          The Lenders hereby acknowledge that the Administrative  Agent shall be
     under no duty to take any discretionary  action permitted to be taken by it
     pursuant to the provisions of this  Agreement  unless it shall be requested
     in writing to do so by the Required Lenders.

          Subject   to  the   appointment   and   acceptance   of  a   successor
     administrative agent as provided below, the Administrative Agent may resign
     at any  time by  notifying  the  Lenders  and the  Borrower.  Upon any such
     resignation,  the  Borrower  shall have the right to  appoint a  successor,
     provided  that any  successor  selected by the Borrower must be approved by
     the Required  Lenders.  If no successor shall have been so appointed by the
     Borrower and shall have accepted such  appointment  within 20 Business Days
     after the retiring  Administrative  Agent gives notice of its  resignation,
     then the Required  Lenders shall have the right to appoint a successor.  If
     no successor shall have been so appointed by the Required Lenders and shall
     have accepted such  appointment  within 30 Business Days after the retiring
     Administrative  Agent gives  notice of its  resignation,  then the retiring
     Administrative  Agent may,  on behalf of the  Lenders,  appoint a successor
     administrative  agent which shall be a bank with an office in New York, New
     York and having a combined  capital and surplus of at least  $1,000,000,000
     or an Affiliate of any such bank. Upon the acceptance of any appointment as
     Administrative  Agent  hereunder by a successor  bank, such successor shall
     succeed to and become vested with all the rights,  powers,  privileges  and
     duties of the retiring Administrative Agent and the retiring Administrative
     Agent shall be discharged from its duties and obligations hereunder.  After
     the Administrative  Agent's resignation  hereunder,  the provisions of this
     Article  and  Section 9.05  shall  continue  in effect  for its  benefit in
     respect  of any  actions  taken or  omitted  to be taken by it while it was
     acting as Administrative Agent.

          With  respect to the Loans made by it  hereunder,  the  Administrative
     Agent in its individual capacity and not as Administrative Agent shall have
     the same rights and powers as any other Lender and may exercise the same as
     though it were not the Administrative  Agent, and the Administrative  Agent
     and its  Affiliates may accept  deposits from,  lend money to and generally
     engage in any kind of business with the Borrower or any Subsidiary or other
     Affiliate thereof as if it were not the Administrative Agent.

                                       48
<PAGE>

          Each Lender  agrees  (i) to  reimburse the  Administrative  Agent,  on
     demand,  in the  amount  of its pro rata  share  (based  on its  Commitment
     hereunder  or,  if the  Commitments  shall  have  terminated,  based on its
     outstanding  Loans  hereunder) of any expenses  incurred for the benefit of
     the Lenders by the Administrative Agent,  including reasonable counsel fees
     and  compensation  of agents and  employees  paid for services  rendered on
     behalf  of the  Lenders,  which  shall  not  have  been  reimbursed  by the
     Borrower,  and (ii) to indemnify and hold harmless the Administrative Agent
     and any of its directors, officers, employees, or agents, on demand, in the
     amount of such pro rata share,  from and  against any and all  liabilities,
     taxes, obligations,  losses, damages, penalties, actions, judgments, suits,
     cost, expenses, or disbursements of any kind or nature whatsoever which may
     be imposed on,  incurred by, or asserted  against it in its capacity as the
     Administrative  Agent or any of them in any way  relating to or arising out
     of this Agreement or any action taken or omitted by it or any of them under
     this Agreement,  to the extent the same shall not have been  indemnified by
     the Borrower; provided that no Lender shall be liable to the Administrative
     Agent  or any of them for any  portion  of such  liabilities,  obligations,
     losses, damages, penalties,  actions, judgments, suits, costs, expenses, or
     disbursements  resulting from the gross negligence or willful misconduct of
     the Administrative Agent or any of its directors,  officers,  employees, or
     agents.

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

          None of the Lenders  identified on the facing page or signature  pages
     of this Agreement as a "co-syndication  agent" shall have any right, power,
     obligation,  liability,  responsibility  or duty under this Agreement other
     than  those  applicable  to all  Lenders  as  such.  Without  limiting  the
     foregoing,  none of the Lenders so identified as a  "co-syndication  agent"
     shall have or be deemed to have any fiduciary relationship with any Lender.
     Each Lender  acknowledges that it has not relied, and will not rely, on any
     of the Lenders so identified in deciding to enter into this Agreement or in
     taking or not taking action hereunder.

                                   Article IX

                                  MISCELLANEOUS

          Section 9.01. Notices.

          Notices  and other  communications  provided  for  herein  shall be in
     writing and shall be  delivered  by the method,  if any,  specified  in the
     relevant  provisions  of this  Agreement and otherwise by hand or overnight
     courier service, mailed or sent by telecopy, as follows:

                                       49
<PAGE>

          (a)  if to  the  Borrower,  to  it at 3  High  Ridge  Park,  Stamford,
     Connecticut 06905, Attention of Treasurer (Telecopy No. 203-614-4625);

          (b) if to the  Administrative  Agent,  to it at  One  Chase  Manhattan
     Plaza,  8th Floor,  New York,  New York 10081,  Attention  of Janet  Belden
     (Telecopy No. 212-552-5658),  with a copy to Joan M. Fitzgibbon,  The Chase
     Manhattan  Bank, 270 Park Avenue,  New York,  New York 10017  (Telecopy No.
     212-270-4164); and

          (c) if to a Lender,  to it at its  address  (or  telecopy  number) set
     forth in  Schedule 2.01  or in the Assignment  and  Acceptance  pursuant to
     which such Lender shall have become a party hereto.

All notices and other  communications  given to any party  hereto in  accordance
with the provisions of this Agreement  shall be deemed to have been given on the
date of receipt if  delivered by hand or  overnight  courier  service or sent by
telecopy,  or on the date five  Business  Days after  dispatch by  certified  or
registered  mail, if mailed,  in each case delivered,  sent, or mailed (properly
addressed) to such party as provided in this  Section 9.01 or in accordance with
the latest  unrevoked  direction  from such party given in accordance  with this
Section 9.01;  provided,  that notices  from the Borrower to the  Administrative
Agent  relating to Borrowings or  Conversions  shall be effective only on actual
receipt.

          Section 9.02. Survival of Agreement.

          All covenants, agreements,  representations and warranties made by the
     Borrower herein and in the  certificates or other  instruments  prepared or
     delivered  in  connection  with or  pursuant  to this  Agreement  shall  be
     considered  to have been relied  upon by the Lenders and shall  survive the
     making by the Lenders of the Loans, regardless of any investigation made by
     the Lenders or on their behalf, and shall continue in full force and effect
     as long as the principal of or any accrued  interest on any Loan or any Fee
     or any other amount payable under this Agreement is outstanding  and unpaid
     or so long as the Commitments have not been terminated.

          Section 9.03. Binding Effect.

          This Agreement shall become effective when it shall have been executed
     by the Borrower and the  Administrative  Agent and when the  Administrative
     Agent shall have received copies hereof which,  when taken  together,  bear
     the  signatures of each Lender,  and  thereafter  shall be binding upon and
     inure to the benefit of the  Borrower,  the  Administrative  Agent and each
     Lender  and  their  respective  successors  and  assigns,  except  that the
     Borrower  shall not have the right to assign  its rights  hereunder  or any
     interest herein without the prior consent of all the Lenders.

          Section 9.04. Successors and Assigns.

          (a) Whenever in this  Agreement any of the parties  hereto is referred
     to, such  reference  shall be deemed to include the successors and assigns,
     of such party;  and all covenants,  promises and agreements by or on behalf
     of the Borrower, the Administrative Agent or the Lenders that are contained
     in this Agreement  shall bind and inure to the benefit of their  respective
     successors and assigns.

                                       50
<PAGE>

          (b) Each Lender may assign to one or more  assignees  all or a portion
     of its interests,  rights and obligations  under this Agreement,  including
     all or a portion of its  Commitment  and the Loans at the time owing to it;
     provided, however, that (i) except in the case of an assignment to a Lender
     or an Affiliate of such Lender, or an assignment to a Federal Reserve Bank,
     the Borrower  and the  Administrative  Agent must give their prior  written
     consent  to  such  assignment,  which  consent  shall  not be  unreasonably
     withheld,  provided,  further, however, that the consent of the Borrower to
     any such  assignment  shall not be required at any time an Event of Default
     shall have occurred and be continuing,  (ii) each such assignment  shall be
     of a constant, and not a varying,  percentage of all the assigning Lender's
     rights  or  obligations  under  this  Agreement,  (iii) the  amount  of the
     Commitment or Loans of the assigning  Lender subject to any such assignment
     (determined as of the date the  Assignment  and Acceptance  with respect to
     such assignment is delivered to the Administrative Agent) shall not be less
     than  $5,000,000  and the amount of the  Commitment or Loans of such Lender
     remaining after such assignment  shall not be less than $5,000,000 or shall
     be zero, (iv) the parties to each such assignment shall execute and deliver
     to the Administrative  Agent an Assignment and Acceptance,  together with a
     processing and recordation fee of $3,500 and (v) the assignee,  if it shall
     not  be  a  Lender,   shall   deliver  to  the   Administrative   Agent  an
     Administrative Questionnaire. Subject to payment in full by the assignee to
     the assignor and upon acceptance and recording pursuant to paragraph (e) of
     this Section  9.04,  from and after the  effective  date  specified in each
     Assignment  and  Acceptance,  which  effective  date shall be at least five
     Business  Days after the execution  thereof,  (A) the  assignee  thereunder
     shall be a party hereto and, to the extent of the interest assigned by such
     Assignment  and  Acceptance,  have  (in  addition  to any such  rights  and
     obligations  theretofore held by it) the rights and obligations of a Lender
     under this Agreement, and (B) the assigning Lender thereunder shall, to the
     extent of the  interest  assigned by such  Assignment  and  Acceptance,  be
     released from its obligations  under this Agreement (and, in the case of an
     Assignment  and  Acceptance  covering  all or the  remaining  portion of an
     assigning Lender's rights and obligations under this Agreement, such Lender
     shall cease to be a party hereto (but shall  continue to be entitled to the
     benefits  of  Sections 2.13,  2.15,  2.19 and 9.05,  as well as to any Fees
     accrued for its account hereunder and not yet paid)).  Notwithstanding  the
     foregoing,  any Lender  assigning  its rights  and  obligations  under this
     Agreement may retain any  Competitive  Loans made by it outstanding at such
     time, and in such case shall retain its rights  hereunder in respect of any
     Loans so retained  until such Loans have been repaid in full in  accordance
     with this Agreement.

          (c) By executing  and  delivering an Assignment  and  Acceptance,  the
     assigning Lender thereunder and the assignee  thereunder shall be deemed to
     confirm  to and agree  with each  other  and the  other  parties  hereto as
     follows:  (i) such  assigning  Lender  warrants  that it is the  legal  and
     beneficial  owner of the interest being assigned  thereby free and clear of
     any adverse claim and that its Commitment,  and the outstanding balances of
     its Standby Loans and Competitive Loans (to the extent  assigned),  in each
     case without  giving  effect to  assignments  thereof which have not become
     effective, are as set forth in such Assignment and Acceptance,  (ii) except
     as set forth in (i) above, such assigning Lender makes no representation or
     warranty  and assumes no  responsibility  with  respect to any  statements,
     warranties,   or  representations  made  in  or  in  connection  with  this
     Agreement,   or  the   execution,   legality,   validity,   enforceability,
     genuineness,   sufficiency,  or  value  of  this  Agreement  or  any  other
     instrument or document furnished pursuant hereto or the financial condition
     of the Borrower or any  Subsidiary or the  performance or observance by the
     Borrower or any Subsidiary of any of its  obligations  under this Agreement
     or any other instrument or document furnished  pursuant hereto;  (iii) such
     assignee  represents  and warrants  that it is legally  authorized to enter
     into such Assignment and Acceptance;  (iv) such  assignee  confirms that it
     has  received a copy of this  Agreement,  together  with copies of the most
     recent  financial  statements  delivered  pursuant to Section 5.02 and such
     other  documents and  information as it has deemed  appropriate to make its
     own  credit  analysis  and  decision  to enter  into  such  Assignment  and
     Acceptance;  (v) such assignee will independently and without reliance upon
     the  Administrative  Agent, such assigning Lender, or any other Lender, and
     based on such documents and information as it shall deem appropriate at the
     time,  continue  to make its own credit  decisions  in taking or not taking
     action under this Agreement; (vi) such assignee appoints and authorizes the
     Administrative  Agent to take such  action as  administrative  agent on its
     behalf and to exercise such powers under this Agreement as are delegated to
     the Administrative Agent by the terms hereof,  together with such powers as
     are reasonably  incidental thereto;  and (vii) such assignee agrees that it
     will perform in accordance  with their terms all the  obligations  which by
     the terms of this Agreement are required to be performed by it as a Lender.

                                       51
<PAGE>

          (d) The  Administrative  Agent shall maintain at one of its offices in
     The City of New York a copy of each Assignment and Acceptance  delivered to
     it and a register  for the  recordation  of the names and  addresses of the
     Lenders, and the Commitment of, and principal amount of the Loans owing to,
     each  Lender   pursuant  to  the  terms  hereof  from  time  to  time  (the
     "Register"). The Administrative Agent shall also record in the Register the
     then scheduled  Termination Date and shall update the Register from time to
     time upon any change in a Lender's  Commitment  and Loans  pursuant  to the
     terms of this Agreement. The entries in the Register shall be conclusive in
     the absence of manifest error, and the Borrower,  the Administrative  Agent
     and the  Lenders  may treat  each  Person  whose  name is  recorded  in the
     Register  pursuant  to the  terms  hereof  as a  Lender  hereunder  for all
     purposes of this Agreement.  The Register shall be available for inspection
     by the Borrower  and any Lender,  at any  reasonable  time and from time to
     time upon reasonable prior notice.

          (e) Upon its receipt of a duly  completed  Assignment  and  Acceptance
     executed  by  an  assigning  Lender  and  an  assignee,  together  with  an
     Administrative  Questionnaire  completed in respect of the assignee (unless
     the assignee  shall  already be a Lender  hereunder),  the  processing  and
     recordation fee referred to in  paragraph (b)  above and, if required,  the
     written  consent  of the  Borrower  and the  Administrative  Agent  to such
     assignment,  the Administrative  Agent shall (i) accept such Assignment and
     Acceptance,  (ii) record the information contained therein in the Register,
     (iii) give  prompt  notice  thereof to the Lenders and  (iv) send a copy of
     such Assignment and Acceptance to the Borrower.

          (f) Each  Lender  may,  without  the  consent of the  Borrower  or the
     Administrative  Agent,  sell  participations  to one or more banks or other
     entities  in all or a portion  of its  rights  and  obligations  under this
     Agreement (including all or a portion of its Commitment and the Loans owing
     to it); provided,  however,  that (i) such Lender's  obligations under this
     Agreement  shall remain  unchanged,  (ii) such  Lender shall remain  solely
     responsible  to the  other  parties  hereto  for  the  performance  of such
     obligations,  (iii) the  participating  banks  or other  entities  shall be
     entitled  to the benefit of the cost  protection  provisions  contained  in
     Sections 2.13, 2.15 and 2.19 to the same extent as if they were Lenders and
     (iv) the  Borrower,  the  Administrative  Agent and the other Lenders shall
     continue to deal solely and directly  with such Lender in  connection  with
     such Lender's rights and obligations under this Agreement,  and such Lender
     shall  retain the sole right to enforce  the  obligations  of the  Borrower
     relating to the Loans and to approve any amendment,  modification or waiver
     of any provision of this Agreement (other than  amendments,  modifications,
     or waivers decreasing any fees payable hereunder or the amount of principal
     of or the rate at which  interest  is payable on the Loans,  extending  any
     scheduled  principal payment date or date fixed for the payment of interest
     on the Loans or Fees, or changing or extending the Commitments).

                                       52
<PAGE>

          (g) Any Lender  may, in  connection  with any  assignment  or proposed
     assignment  pursuant  to this  Section 9.04,  disclose  to the  assignee or
     proposed  assignee any  information  relating to the Borrower  furnished to
     such Lender by or on behalf of the Borrower;  provided  that,  prior to any
     such disclosure of information  designated by the Borrower as confidential,
     each such assignee or proposed  assignee shall execute an agreement whereby
     such assignee shall agree (subject to customary exceptions) to preserve the
     confidentiality  of such  confidential  information.  It is understood that
     confidential  information  relating to the Borrower would not ordinarily be
     provided in connection  with  assignments of Competitive  Loans.  No Lender
     may,  in  connection  with  any  participation  or  proposed  participation
     pursuant  to this  Section 9.04,  disclose to any  participant  or proposed
     participant any confidential  information  relating to the Borrower without
     the prior written consent of the Borrower.

          (h) Any Lender may at any time assign all or any portion of its rights
     under this Agreement and its promissory notes (if any) to a Federal Reserve
     Bank;  provided that no such assignment  shall release a Lender from any of
     its obligations hereunder.

          (i) The  Borrower  shall not assign or  delegate  any of its rights or
     duties hereunder.

          Section 9.05. Expenses; Indemnity.

          (a) The  Borrower  agrees to pay  (i) all  reasonable  legal  fees and
     disbursements  incurred by the Administrative  Agent in connection with the
     preparation   of  this  Agreement  and  (ii) all   out-of-pocket   expenses
     (including  reasonable fees and  disbursements of counsel)  incurred by the
     Administrative  Agent and any  Lender in  connection  with any  amendments,
     modifications or waivers of the provisions hereof or thereof or incurred by
     the  Administrative  Agent or any Lender in connection with the enforcement
     or protection of their rights in connection with this Agreement.

          (b) The Borrower agrees to indemnify the  Administrative  Agent,  each
     Lender  and  each  of  their  respective  directors,  officers,  employees,
     Affiliates  and agents  (each such  Person  being  called an  "Indemnitee")
     against,  and to hold each  Indemnitee  harmless  from, any and all losses,
     claims,  damages,  liabilities and related expenses,  including  reasonable
     counsel fees and expenses,  incurred by or asserted  against any Indemnitee
     arising out of, (i) the use of the proceeds of the Loans or (ii) any claim,
     litigation,  investigation,  or proceeding relating to this Agreement,  the
     use of such proceeds or the transactions  contemplated  hereby,  whether or
     not any Indemnitee is a party thereto;  provided that such indemnity  shall
     not, as to any  Indemnitee,  be  available  to the extent that such losses,
     claims, damages, liabilities, or related expenses are determined by a court
     of  competent  jurisdiction  by final and  nonappealable  judgment  to have
     resulted from the negligence or willful misconduct of such Indemnitee. Each
     Lender shall notify the Borrower  promptly after it determines that it will
     make a claim for indemnification under this  Section 9.05(b).  The Borrower
     shall  be  entitled  to  participate  in the  defense  of  the  litigation,
     investigation,  or  proceeding  giving  rise to  such  claim  with  counsel
     satisfactory  to the Lender,  in the exercise of its  reasonable  judgment;
     provided,  however,  that any such  participation  in such defense shall be
     conducted  by the Borrower  and at the  Borrower's  expense and in a manner
     considered  by such  Lender to be  satisfactory  and  effective  to protect
     against such claim without  causing  damage to the conduct of, or affecting
     such Lender's control of, such Lender's defense.  The Borrower shall inform
     such Lender of its  intention to  participate  in the defense of such claim
     within 15 days after receipt of notice thereof from such Lender.

                                       53
<PAGE>

          (c) The provisions of this Section 9.05  shall remain operative and in
     full  force and effect  regardless  of the  expiration  of the term of this
     Agreement,  the consummation of the transactions  contemplated  hereby, the
     repayment of any of the Loans,  the invalidity or  unenforceability  of any
     term or provision of this  Agreement,  or any  investigation  made by or on
     behalf of the  Administrative  Agent or any  Lender.  All amounts due under
     this Section 9.05 shall be payable on written demand therefor.

          Section 9.06. Right of Setoff.

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

          Section 9.07. Applicable Law.

          THIS AGREEMENT  SHALL BE CONSTRUED IN ACCORDANCE  WITH AND GOVERNED BY
     THE LAWS OF THE STATE OF NEW YORK.

          Section 9.08. Waivers; Amendment.

          (a) No failure or delay of the  Administrative  Agent or any Lender in
     exercising any power or right  hereunder shall operate as a waiver thereof,
     nor shall any single or partial exercise of any such right or power, or any
     abandonment  or  discontinuance  of steps to enforce such a right or power,
     preclude any other or further exercise thereof or the exercise of any other
     right or power. The rights and remedies of the Administrative Agent and the
     Lenders  hereunder  are  cumulative  and are not exclusive of any rights or
     remedies  which they would  otherwise  have.  No waiver of any provision of
     this Agreement or consent to any departure by the Borrower  therefrom shall
     in  any  event  be  effective   unless  the  same  shall  be  permitted  by
     paragraph (b)  below,  and then such waiver or consent  shall be  effective
     only in the  specific  instance  and for the  purpose for which  given.  No
     notice or demand on the Borrower in any case shall  entitle the Borrower to
     any other or further notice or demand in similar or other circumstances.

                                       54
<PAGE>

          (b) Except as provided in Section 2.11(e),  neither this Agreement nor
     any provision hereof may be waived, amended, or modified except pursuant to
     an agreement or agreements in writing  entered into by the Borrower and the
     Required  Lenders;   provided,   however,  that  no  such  agreement  shall
     (i) decrease  the  principal  amount of, or extend the  maturity  of or any
     scheduled  principal  payment  date or date for the payment of any interest
     on, any Loan, or waive or excuse any such payment or any part  thereof,  or
     decrease  the rate of  interest  on any Loan,  without  the  prior  written
     consent of each Lender, (ii) except as provided in Section 2.11(e),  change
     or extend the  Commitment of any Lender or decrease or extend any scheduled
     payment date for the Facility Fees of any Lender  without the prior written
     consent  of such  Lender,  or  (iii) amend  or  modify  the  provisions  of
     Section 2.16, the provisions of this Section or the definition of "Required
     Lenders",  without  the prior  written  consent  of each  Lender;  provided
     further that no such agreement shall amend, modify, or otherwise affect the
     rights or duties of the  Administrative  Agent hereunder  without the prior
     written consent of the Administrative  Agent. Each Lender shall be bound by
     any waiver,  amendment,  or  modification  authorized by this Section or by
     Section 2.11(e),  and any consent by any Lender pursuant to this Section or
     by Section 2.11(e)  shall bind any Transferee of its rights and obligations
     hereunder.

          Section 9.09. Interest Rate Limitation.

          Notwithstanding  anything  herein to the contrary,  if at any time the
     applicable  interest  rate,  together  with all fees and charges  which are
     treated as interest under applicable law (collectively,  the "Charges"), as
     provided  for  herein  or in any  other  document  executed  in  connection
     herewith,  or  otherwise  contracted  for,  charged,  received,  taken,  or
     reserved by any Lender,  shall exceed the maximum lawful rate (the "Maximum
     Rate") which may be contracted for, charged,  taken,  received, or reserved
     by such Lender in  accordance  with  applicable  law,  the rate of interest
     payable to such Lender,  together with all Charges  payable to such Lender,
     shall be limited to the Maximum Rate.

          Section 9.10. Entire Agreement.

          This Agreement  constitutes  the entire  contract  between the parties
     relative to the subject matter  hereof.  Any previous  agreement  among the
     parties with respect to the subject  matter  hereof is  superseded  by this
     Agreement. Nothing in this Agreement,  expressed or implied, is intended to
     confer upon any party other than the parties hereto and thereto any rights,
     remedies, obligations, or liabilities under or by reason of this Agreement.

          Section 9.11. Waiver of Jury Trial.

          EACH PARTY HERETO HEREBY WAIVES,  TO THE FULLEST  EXTENT  PERMITTED BY
     APPLICABLE  LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
     LITIGATION  DIRECTLY OR INDIRECTLY  ARISING OUT OF, UNDER, OR IN CONNECTION
     WITH THIS  AGREEMENT  OR ANY OTHER  AGREEMENT  OR  INSTRUMENT  EXECUTED AND
     DELIVERED IN CONNECTION  HEREWITH.  EACH PARTY HERETO (a) CERTIFIES THAT NO
     REPRESENTATIVE,  AGENT,  OR ATTORNEY  OF ANY OTHER  PARTY HAS  REPRESENTED,
     EXPRESSLY  OR  OTHERWISE,  THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
     LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (b) ACKNOWLEDGES THAT
     IT AND THE OTHER  PARTIES  HERETO  HAVE  BEEN  INDUCED  TO ENTER  INTO THIS
     AGREEMENT AND, IF APPLICABLE,  ANY OTHER  AGREEMENT OR INSTRUMENT  EXECUTED
     AND DELIVERED IN CONNECTION  HEREWITH,  BY, AMONG OTHER THINGS,  THE MUTUAL
     WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.

                                       55
<PAGE>

          Section 9.12. Severability.

          In the  event  any  one or more of the  provisions  contained  in this
     Agreement should be held invalid, illegal, or unenforceable in any respect,
     the  validity,  legality and  enforceability  of the  remaining  provisions
     contained herein shall not in any way be affected or impaired thereby.  The
     parties shall endeavor in good-faith  negotiations  to replace the invalid,
     illegal,  or  unenforceable  provisions with valid  provisions the economic
     effect of which comes as close as possible to that of the invalid, illegal,
     or unenforceable provisions.

          Section 9.13. Counterparts.

          This  Agreement may be executed in two or more  counterparts,  each of
     which shall  constitute  an original  but all of which when taken  together
     shall  constitute but one contract,  and shall become effective as provided
     in Section 9.03.

          Section 9.14. Headings.

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

          Section 9.15. Jurisdiction; Consent to Service of Process.

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

          (b) The Borrower hereby irrevocably and unconditionally waives, to the
     fullest extent it may legally and effectively do so, any objection which it
     may now or hereafter  have to the laying of venue of any suit,  action,  or
     proceeding  arising  out of or  relating  to this  Agreement  or any  other
     agreement or instrument  executed and  delivered in connection  herewith in
     any New York State court or Federal  court of the United  States of America
     sitting in New York City.  Each of the parties  hereto  hereby  irrevocably
     waives,  to  the  fullest  extent  permitted  by  law,  the  defense  of an
     inconvenient  forum to the  maintenance of such action or proceeding in any
     such court.

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

                            [Signature pages follow]
                                       56
<PAGE>

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

                              CITIZENS COMMUNICATIONS COMPANY

                              By:
                                   Name:
                                   Title:

                              THE CHASE MANHATTAN BANK,
                              as Administrative Agent

                              By:
                                   Name:
                                   Title:

                              Lenders:

                              THE CHASE MANHATTAN BANK

                              By:
                                   Name:
                                   Title:CITZENS COMMUNICATIONS COMPANY

                           2000 EQUITY INCENTIVE PLAN

                                    SECTION 1

                                     PURPOSE

     The purpose of the Citizens  Communications  Company 2000 Equity  Incentive
Plan (the  "Plan")  is to provide  compensation  incentives  for high  levels of
performance and  productivity by employees of the Company.  The Plan is intended
to strengthen the Company's  existing  operations and its ability to attract and
retain  outstanding  employees upon whose  judgment,  initiative and efforts the
continued success,  growth and development of the Company is dependent,  as well
as encourage such employees to have a greater personal  financial  investment in
the Company through ownership of its common stock.

                                    SECTION 2

                                   DEFINITIONS

     When used herein, the following terms have the following meanings:

          (a)  "AFFILIATE"   means  any  company   controlled  by  the  Company,
     controlling the Company or under common control with the Company.

          (b)  "AWARD"  means an award  granted to any  Eligible  Individual  in
     accordance with the provisions of the Plan.

          (c) "AWARD  AGREEMENT"  means the  written  agreement  or  certificate
     evidencing the terms of the Award granted to an Eligible  Individual  under
     the Plan.

          (d)  "BENEFICIARY"  means the beneficiary or beneficiaries  designated
     pursuant  to Section 11 to receive the amount,  if any,  payable  under the
     Plan upon the death of an Eligible Individual.

          (e) "BOARD" means the Board of Directors of the Company.

          (f) A "CHANGE  IN  CONTROL"  shall mean the  occurrence  of any of the
     following events with respect to the Company:

               (i) (A) a third "person" (other than an employee  benefit plan of
          the Company),  including a "group", as those terms are used in Section
          13(d) of the Exchange Act, is or becomes the beneficial owner (as that
          term is used in said  Section  13(d)) of stock having  twenty  percent
          (20%) or more of the total  number  of votes  that may be cast for the
          election  of members of the Board or twenty  percent  (20%) or more of
          the fair market value of the Company's  issued and outstanding  stock,
          or (B) the receipt by the Company of any report, schedule, application
          or other document filed with a state or federal governmental agency or
          commission disclosing such ownership or proposed ownership.
<PAGE>

               (ii)  approval  by the  stockholders  of the  Company  of any (1)
          consolidation  or merger or sale of assets of the Company in which the
          Company is not the continuing or surviving  corporation or pursuant to
          which  shares of stock  the  Company  would be  converted  into  cash,
          securities or other property,  other than a consolidation or merger of
          the Company in which holders of its common stock  immediately prior to
          the consolidation or merger have  substantially the same proportionate
          ownership of common  stock of the  surviving  corporation  immediately
          after the consolidation or merger as they held immediately  before, or
          (2) sale,  lease,  exchange or other transfer (in one transaction or a
          series of related transactions) of all or substantially all the assets
          or businesses of the Company;

               (iii) as a result  of, or in  connection  with,  any cash  tender
          offer, exchange offer, merger or other business  combination,  sale of
          assets or contested  election,  or any  combination  of the  foregoing
          transactions  (a  "Transaction"),  the  persons who are members of the
          Board before the  Transaction  shall cease to constitute a majority of
          the Board or any successor to the Company.

          (g)   "CITIZENS   PENSION   PLANS"   means   any  of   the   Company's
     non-contributory  defined-benefit  qualified retirement plans in effect and
     applicable on the date in question.

          (h) "CODE" means the Internal  Revenue Code of 1986,  as now in effect
     or as hereafter amended. (All citations to Sections of the Code are to such
     Sections as they are  currently  designated  and reference to such Sections
     shall  include  the  provisions  thereof  as they may from  time to time be
     amended  or  renumbered  as  well  as  any  successor  provisions  and  any
     applicable regulations.)

          (i) "COMPANY" means Citizens Communications Company and its successors
     and assigns.

          (j)  "COMMITTEE"  means  the  Compensation  Committee  of the Board of
     Directors of the Company.

          (k) "DEFERRED  STOCK" means Stock  credited to an Eligible  Individual
     under the Plan  subject  to the  requirements  of  Section 8 and such other
     terms and restrictions as the Committee deems appropriate or desirable.

          (l) "EFFECTIVE DATE" means May 18, 2000.

          (m) "ELIGIBLE  INDIVIDUAL" means a director,  officer,  or employee of
     any  Participating  Company or an individual who performs  services for the
     Company directly or indirectly as a director, consultant or otherwise whose
     judgment,  initiative and efforts, in the judgment of the Committee, foster
     the  continued  efficiency,  productivity,  growth and  development  of any
     Participating Company. Where required by the context, "Eligible Individual"
     includes  an  individual  who has been  granted  an Award  but is no longer
     performing services for any Participating Company.

                                       2
<PAGE>

          (n) "FAIR MARKET VALUE" means,  unless another  reasonable  method for
     determining fair market value is specified by the Committee, the average of
     the high and low sales prices of a share of the appropriate Series of Stock
     as reported by the New York Stock Exchange (or if such shares are listed on
     another national stock exchange or national  quotation  system, as reported
     or quoted by such  exchange  or system) on the date in  question  or, if no
     such sales were  reported for such date,  for the most recent date on which
     sales prices were quoted.

          (o) "FAMILY MEMBER" AND "FAMILY TRUST" shall have the same meanings as
     are employed  from time to time by the SEC for the purpose of the exception
     to the rules  promulgated by the SEC which limit  transferability  of stock
     options and stock  awards for  purposes of Section 16 of the  Exchange  Act
     and/or the use of Form S-8 under the  Securities  Act.  For the purposes of
     the Plan, the phrases  "Family  Member" and "Family Trust" shall be further
     limited,  if necessary,  so that neither the transfer to a Family Member or
     Family Trust nor the ability of a Participant to make such a transfer shall
     have  adverse  consequences  to the Company or a  Participant  by reason of
     Section 162(m) of the Code.

          (p) "OPTION" means an option to purchase Stock,  including  Restricted
     Stock or Deferred  Stock,  if the Committee so  determines,  subject to the
     applicable provisions of Section 5 and awarded in accordance with the terms
     of the Plan and which may be an  incentive  stock  option  qualified  under
     Section 422 of the Code or a nonqualified stock option.

          (q)  "PARTICIPATING  COMPANY"  means the Company or any  subsidiary or
     other  affiliate of the Company;  provided,  however,  for incentive  stock
     options only, "Participating Company" means the Company, any corporation or
     other  entity  which at the time  such  option  is  granted  under the Plan
     qualifies  as  a  subsidiary  of  the  Company  under  the   definition  of
     "subsidiary corporation" contained in Section 425(f) of the Code.

          (r)  "PARTICIPANT"  means an  Eligible  Individual  who has been or is
     being  granted an Award.  When required by the context,  the  definition of
     Participant  shall include an individual  who has been granted an Award but
     is no longer an employee of any Participating Company.

          (s)  "PERFORMANCE  SHARE"  means a  performance  share  subject to the
     requirements  of Section 6 and awarded in accordance  with the terms of the
     Plan.

          (t) "PHANTOM  STOCK" means a unit whose value is determined  solely by
     reference  to the value of one or more  shares of Stock.  Awards of Phantom
     Stock may be made pursuant to Section 9.

          (u) "PLAN"  means the  Citizens  Communications  Company  2000  Equity
     Incentive  Plan, as the same may be amended,  administered  or  interpreted
     from time to time.

          (v) "RESTRICTED STOCK" means Stock delivered under the Plan subject to
     the  requirements of Section 7 and such other terms and restrictions as the
     Committee deems appropriate or desirable.

                                       3
<PAGE>

          (w) "SAR" means a stock  appreciation right subject to the appropriate
     requirements  under Section 5 and awarded in  accordance  with the terms of
     the Plan.

          (x) "SEC" means the Securities and Exchange Commission. "Exchange Act"
     means the  Securities  Exchange  Act of 1934.  "Rule 16b-3" shall mean such
     rule  promulgated  by the SEC  under  the  Exchange  Act  and,  unless  the
     circumstances require otherwise, shall include any other rule or regulation
     adopted  under  Sections  16(a) or 16(b) of the  Exchange  Act  relating to
     compliance  with, or an exemption  from,  Section 16(b).  "Securities  Act"
     means  the  Securities  Act  of  1933.  Reference  to  any  section  of the
     Securities  Act,  Exchange  Act or any rule  promulgated  thereunder  shall
     include any successor section or rule.

          (y) "STOCK"  means the Common  Stock of the Company and any  successor
     Common Stock.

          (z) "TERMINATION WITHOUT CAUSE" means termination of employment with a
     Participating  Company by the  employer  for any reason  other than  death,
     Total   Disability  or  termination  for   deliberate,   willful  or  gross
     misconduct, and also means voluntary termination of employment by employee.

          (aa) "TOTAL DISABILITY" means the complete and permanent  inability of
     an Eligible  Individual to perform all of his or her duties under the terms
     of his or her employment with any Participating  Company,  as determined by
     the  Committee  upon the  basis  of such  evidence,  including  independent
     medical reports and data, as the Company deems appropriate or necessary.

                                    SECTION 3

                           SHARES SUBJECT TO THE PLAN

          (a) Subject to adjustment as provided in Section 14 hereof, 19,000,000
     shares of Stock are hereby  reserved for issuance  pursuant to Awards under
     the Plan. Awards of Phantom Stock or share units that, by the terms of such
     Awards,  are  payable  solely in cash shall not be  subject to such  limit;
     provided,  however,  that such Awards shall be subject to a separate  limit
     such  that the value of all such  Awards  granted  under the Plan  shall be
     determined by reference to no more than 10,000,000 shares of Stock.  Shares
     of Stock  reserved  for  issuance  under the Plan  shall be made  available
     either from authorized and unissued  shares,  shares held by the Company in
     its treasury or  reacquired  shares.  The term  "issued"  shall include all
     deliveries to a Participant of shares of Stock pursuant to Awards under the
     Plan.  The Committee may, in its  discretion,  decide to award other shares
     issued by the Company that are  convertible  into Stock or make such shares
     subject to  purchase by an option,  in which  event the  maximum  number of
     shares of Stock into which such  shares may be  converted  shall be used in
     applying the aggregate  share limit under this Section 3 and all provisions
     of the Plan  relating  to Stock shall apply with full force and effect with
     respect to such convertible shares.

          (b) If,  for any  reason,  any  shares of Stock  awarded or subject to
     purchase or issuance  under the Plan are not delivered or are reacquired by
     the Company  for reasons  including,  but not limited to, a  forfeiture  of
     Restricted  Stock  or  Deferred  Stock  or  termination,  expiration  or  a
     cancellation of an Option, SAR or a Performance Share, such shares of Stock
     shall be deemed not to have been issued  pursuant to Awards under the Plan,
     or to have been subject to the Plan; provided,  however,  that the counting
     of shares of Stock  subject to Awards  granted  under the Plan  against the
     number of shares available for further Awards shall in all cases conform to
     the requirements of Rule 16b-3 under the Exchange Act.

                                       4
<PAGE>

          (c) With respect to any Award constituting an Option or SAR granted to
     any Eligible  Individual who is a "covered  employee" as defined in Section
     162(m)  of the  Code  that is  canceled,  the  number  of  shares  of Stock
     originally subject to such Award shall continue to count in accordance with
     Section 162(m) of the Code.

          (d)  Unless  the  Committee  otherwise  determines,  shares  of  Stock
     received  by the  Company in  connection  with the  exercise  of Options by
     delivery of shares or in connection  with the payment of withholding  taxes
     shall  reduce the number of shares  deemed to have been issued  pursuant to
     Awards under the Plan for the limit set forth in Section 3(a) hereof.

                                    SECTION 4

                      GRANT OF AWARDS AND AWARD AGREEMENTS

          (a) Subject to and in  furtherance  of the provisions of the Plan, the
     Committee  shall  (i)  determine  and  designate  from  time to time  those
     Eligible  Individuals or groups of Eligible  Individuals to whom Awards are
     to be granted;  (ii) grant Awards to Eligible  Individual;  (iii) determine
     the form or forms of Award to be granted to any Eligible  Individual;  (iv)
     determine  the  amount or number of shares of Stock,  including  Restricted
     Stock or Deferred  Stock if the  Committee so  determines,  subject to each
     Award; (v) determine the terms and conditions (which need not be identical)
     of  each  Award;  (vi)  determine  the  rights  of each  Participant  after
     employment  has  terminated and the periods during which such rights may be
     exercised;  (vii)  establish  and  modify  performance  objectives;  (viii)
     determine whether and to what extent Eligible  Individuals shall be allowed
     or required to defer receipt of any Awards or other  amounts  payable under
     the Plan to the occurrence of a specified date or event; (ix) determine the
     price at which shares of Stock may be offered  under each Award which price
     may, except in the case of Options,  be zero; (x) permit cashless  exercise
     of  Options  and other  Awards  of a sale,  loan or other  nature  covering
     exercise  prices  and/or  income  taxes;   (xi)  interpret,   construe  and
     administer  the Plan and any related  Award  Agreement and define the terms
     employed  therein;  and (xii) make all of the  determinations  necessary or
     advisable with respect to the Plan or any Award granted thereunder.  Awards
     granted to  different  Eligible  Individuals  or  Participants  need not be
     identical  and, in addition,  may be modified in different  respects by the
     Committee.

          (b) Each Award  granted under the Plan shall be evidenced by a written
     Award Agreement, in a form approved by the Committee.  Such agreement shall
     be subject to and  incorporate  the express terms and  conditions,  if any,
     required  under the Plan or as  required by the  Committee  for the form of
     Award  granted and such other terms and  conditions  as the  Committee  may
     specify.

                                       5
<PAGE>

          (c) The Committee may modify or amend any Awards (by  cancellation and
     regrant  or  substitution  of  Awards  or  otherwise  and  with  terms  and
     conditions  more or less  favorable to Eligible  Individuals)  or waive any
     restrictions  or  conditions  applicable  to any Awards or the  exercise or
     realization  thereof  (except that the Committee may not undertake any such
     modifications,  amendments  or waivers if the  effect  thereof,  taken as a
     whole,  adversely  and  materially  affects the rights of any  recipient of
     previously  granted  Awards  without  his  or  her  consent,   unless  such
     modification,  amendment  or  waiver  is  necessary  or  desirable  for the
     continued  validity  of the Plan or its  compliance  with Rule 16b-3 or any
     other  applicable law, rule or regulation or  pronouncement or to avoid any
     adverse consequences under Section 162(m) of the Code or any requirement of
     a securities  exchange or  association  or  regulatory  or  self-regulatory
     body).

          (d) The  Committee  may permit  the  voluntary  surrender  of all or a
     portion  of any Award  granted  under the Plan to be  conditioned  upon the
     granting  of a new  Award or may  require  such  voluntary  surrender  as a
     condition to a grant of a new Award. Any such new Award shall be subject to
     such terms and conditions as are specified by the Committee at the time the
     new Award is granted,  determined in accordance  with the provisions of the
     Plan without regard to the terms of the surrendered Award.

          (e) In any calendar  year, no Eligible  Individual  may receive Awards
     covering more than 2,000,000  shares of the Company's Stock if the Award is
     denominated  in or valued by  reference  to a number of  shares,  or if the
     Award is denominated in dollars,  $750,000 in dollar value.  Such number of
     shares shall be adjusted in accordance with Section 14 hereof.

                                    SECTION 5

                   STOCK OPTIONS AND STOCK APPRECIATION RIGHTS

          (a) With  respect to the Options  and SARs,  the  Committee  shall (i)
     authorize  the  granting of incentive  stock  options,  nonqualified  stock
     options,  SARs or a combination of incentive  stock  options,  nonqualified
     stock  options  and  SARs;  (ii)  determine  the  number of shares of Stock
     subject to each  Option or the number of shares of Stock that shall be used
     to determine the value of a SAR; (iii)  determine  whether such Stock shall
     be  Restricted  Stock or,  with  respect  to  nonqualified  stock  options,
     Deferred  Stock;  (iv)  determine  the time or times when and the manner in
     which each Option  shall be  exercisable  and the  duration of the exercise
     period;  and (v) determine whether or not all or part of each Option may be
     canceled by the exercise of a SAR;  provided,  however,  that the aggregate
     Fair Market Value  (determined  as of the date of Option is granted) of the
     Stock  (disregarding  any restrictions in the case of Restricted Stock) for
     which incentive stock options granted to any Eligible Individual under this
     Plan may first become  exercisable  in any  calendar  year shall not exceed
     $100,000.  Notwithstanding  the  foregoing,  to  the  extent  that  Options
     intended to be incentive  stock options  granted to an Eligible  Individual
     under this Plan for any reason  exceed such limit on  exercisability,  such
     excess Options shall be treated as  nonqualified  stock options as provided
     under Section 422(d) of the Code,  but shall in all other  respects  remain
     outstanding and exercisable in accordance with their terms.

                                       6
<PAGE>

          (b) The exercise  period for a nonqualified  stock option or SAR shall
     be 10  years  from  the date of  grant  or such  shorter  period  as may be
     specified by the Committee at the time of grant. The exercise period for an
     incentive  stock option and any related SAR,  including any extension which
     the  Committee  may from time to time decide to grant,  shall not exceed 10
     years from the date of grant;  provided,  however,  that, in the case of an
     incentive  stock option granted to an Eligible  Individual who, at the time
     of grant,  owns stock possessing more than 10% of the total combined voting
     power of all  classes of stock of the Company (a "10%  Stockholder"),  such
     period, including extensions,  shall not exceed five years from the date of
     grant.

          (c) The  Option  or SAR price per  share  shall be  determined  by the
     Committee  at the time any Option is granted and shall be not less than the
     Fair Market Value,  or, in the case of an incentive stock option granted to
     a 10%  Stockholder  and any related  tandem  SARs,  110 percent of the Fair
     Market Value, disregarding any restrictions in the case of Restricted Stock
     or Deferred Stock, on the date the Option is granted,  as determined by the
     Committee;  provided,  however,  that such price shall be at least equal to
     the par value of one share of Stock; provided further, however, that in the
     discretion of the Committee in the case of a nonstatutory stock option, the
     Option or SAR price per share may be less than the Fair Market Value in the
     case of an Option or SAR granted in order to induce an individual to become
     an employee of a  Participating  Company or in the case of an Option or SAR
     granted to a new or prospective  employee in order to replace stock options
     or  other  long-term  incentives  under  a  program  maintained  by a prior
     employer  which are  forfeited or cease to be available to the new employee
     by reason of his termination of employment with his prior employer.

          (d) No part  of any  Option  or SAR may be  exercised  (i)  until  the
     Participant  who has been  granted  the Award  shall have  remained  in the
     employ of a  Participating  Company for such period after the date on which
     the Option or SAR is granted as the  Committee  may  specify and (ii) until
     achievement  of  such  performance  or  other  criteria,  if  any,  by  the
     Participant, as the Committee may specify. A SAR and a related Option shall
     commence to be  exercisable  no earlier than six months  following the date
     the Option and SAR are granted.  The Committee may further  require that an
     Option or SAR become exercisable in installments.

          (e) Except as otherwise  provided in the Plan,  the purchase  price of
     the shares as to which an Option  shall be  exercised  shall be paid to the
     Company  at  the  time  of  exercise  either  in  cash  or  in  such  other
     consideration as the Committee deems appropriate, including, Stock, or with
     respect  to  nonqualified  options,  Restricted  Stock or  Deferred  Stock,
     already  owned by the  optionee  (subject  to any  minimum  holding  period
     specified  by  the  Committee),  having  a  total  Fair  Market  Value,  as
     determined by the Committee,  equal to the purchase price, or a combination
     of cash and such other  consideration  having a total Fair Market Value, as
     so determined,  equal to the purchase  price;  provided,  however,  that if
     payment  of the  exercise  price is made in whole or in part in the form of
     Restricted Stock or Deferred Stock, the Stock received upon the exercise of
     the Option shall be Restricted Stock or Deferred Stock, as the case may be,
     at least with  respect to the same number of shares and subject to the same
     restrictions or other limitations as the Restricted Stock or Deferred Stock
     paid on the  exercise  of the Option.  The  Committee  may  provide  that a
     Participant who delivers shares of Stock to the Company, or sells shares of
     Stock and applies all of the proceeds, (a) to pay, or reimburse the payment
     of the exercise  price of shares of Stock  acquired under an employee stock
     option or SAR or to purchase  shares of Stock  under an  employee  award or
     grant,  an  employee  purchase  plan or  program  or any other  stock-based
     employee benefit or incentive plan,  (whether or not such award or grant is
     under this Plan) and/or (b) to pay federal or state income taxes  resulting
     from the  exercise  of such  options or SARs or the  purchase  of shares of
     Stock pursuant to any such grant,  award, plan or program,  shall receive a
     replacement  Option under this Plan to purchase a number of shares of Stock
     equal to the number of shares of Stock  delivered to the Company,  or sold,
     the  proceeds  of the  sale of  which  are  applied  as  aforesaid  in this
     sentence. The replacement Option shall have an exercise price equal to Fair
     Market Value on the date of such payment and shall include such other terms
     and conditions as the Committee may specify.

                                       7
<PAGE>

               (f) (i)  Upon the  Termination  Without  Cause  of a  Participant
          holding  Options or SARs who is not  immediately  eligible  to receive
          benefits  under the terms of the Citizens  Pension  Plans,  his or her
          Options and SARs may be  exercised  to the extent  exercisable  on the
          date of Termination  Without Cause,  at any time and from time to time
          within  the  three  months  of  the  date  of  such  Termination.  The
          Committee,  however, in its discretion, may provide that any Option or
          SAR of such a Participant which is not exercisable by its terms on the
          date  of  Termination   Without  Cause  will  become   exercisable  in
          accordance  with a schedule  (which may extend the time limit referred
          to above,  but not later than the final  expiration  date specified in
          the Option or SAR Award  Agreement)  to be determined by the Committee
          at any time during the period  that any other  Options or SARs held by
          the Participant are exercisable.

               (ii) Upon the death or Total  Disability  (during a Participant's
          employment or within 3 months after  termination of employment for any
          reason other than  termination for cause) of a Participant  holding an
          Option or SAR who is not  immediately  eligible  to  receive  benefits
          under the terms of the Citizens  Pension Plans, his or her Options and
          SARs may be exercised  only to the extent  exercisable  at the time of
          death or Total Disability (or such earlier  termination of employment)
          from  time to time (A) in the  event  of  death  or Total  Disability,
          within the 12 months following death or Total Disability or (B) in the
          event of such  termination  of  employment  followed by death or Total
          Disability within the 3 months after such  termination,  within the 12
          months  following such  termination.  The Committee,  however,  in its
          discretion,  may provide that any Options or SAR's outstanding but not
          exercisable  at the date of the  first to  occur  of death  or,  Total
          Disability  will  become  exercisable  in  accordance  with a schedule
          (which  may extend the  limits  referred  to above,  but not to a date
          later than the final  expiration  date specified in such Option or SAR
          Award  Agreement) to be determined by the Committee at any time during
          the period while any other Option or SARs held by the  Participant are
          exercisable.

               (iii) Upon death,  Total Disability or Termination  Without Cause
          of a  Participant  holding an Option(s)  or SAR(s) who is  immediately
          eligible to receive  benefits under the terms of the Citizens  Pension
          Plans,  his or her Options or SARs may be  exercised in full as to all
          shares or SAR  rights  covered  by  Options  and SAR Award  Agreements
          (whether or not then  exercisable)  at any time, or from time to time,
          but no later than the expiration  date specified in such Option or SAR
          Award  Agreement as specified in Section 5(b) above or, in the case of
          incentive  Options,  within  12 months  following  such  death,  Total
          Disability or Termination Without Cause.

                                       8
<PAGE>

               (iv) If the employment of a Participant  holding an Option or SAR
          is  terminated  for  deliberate,   willful  or  gross  misconduct,  as
          determined  by the  Company,  all rights of such  Participant  and any
          Family  Member  or  Family  Trust or other  transferee  to which  such
          Participant has transferred his or her Option or SAR shall expire upon
          receipt by the Participant of the notice of such termination.

               (v) In  the  event  of the  death  of a  Participant,  his or her
          Options and SARs may be exercised by the person or persons to whom the
          Participant's  rights  under the Option or SAR pass by will,  or if no
          such person has such right, by his or her executors or  administrators
          or Beneficiary.  The death of a Participant  after Total Disability or
          Termination  Without Cause will not  adversely  effect the rights of a
          Participant or anyone entitled to the benefits of such Option or SAR.

          (g) Except as otherwise determined by the Committee,  no Option or SAR
     granted under the Plan shall be  transferable  other than by will or by the
     laws of descent and distribution,  unless the Committee  determines that an
     Option or SAR may be  transferred  by a  Participant  to a Family Member or
     Family Trust or other  transferee.  Such  transfer  shall be evidenced by a
     writing from a grantee to the Committee or  Committee's  designee on a form
     established  by the  Committee.  Absent an authorized  transfer  during the
     lifetime of the Participant,  an Option shall be exercisable only by him or
     her by his or her guardian or legal representative.

          (h) With respect to an incentive  stock option,  the  Committee  shall
     specify such terms and  provisions  as the  Committee  may  determine to be
     necessary  or  desirable  in order to qualify  such Option as an  incentive
     stock option within the meaning of Section 422 of the Code.

          (i) Upon exercise of a SAR, the Participant shall be entitled, subject
     to such terms and  conditions  as the Committee may specify at any time, to
     receive  upon  exercise  thereof  all or a portion of the excess of (i) the
     Fair Market  Value of a specified  number of shares of Stock at the time of
     exercise,  as determined  by the  Committee,  over (ii) a specified  amount
     which  shall not,  subject to Section  5(j),  be less than the Fair  Market
     Value of such  specified  number  of shares of Stock at the time the SAR is
     granted.  Upon  exercise of a SAR,  payment of such excess shall be made as
     the  Committee  shall  specify (A) in cash,  (B)  through  the  issuance or
     transfer to the Participant of whole shares of Stock,  including Restricted
     Stock  or  Deferred  Stock,  with a Fair  Market  Value,  disregarding  any
     restrictions  in the case of Restricted  Stock or Deferred  Stock,  at such
     time equal to any such excess,  or (c) a combination  of cash and shares of
     Stock with a combined  Fair Market Value at such time equal to such excess,
     all as determined by the Committee;  provided,  however, a fractional share
     of Stock  shall  be paid in cash  equal  to the  Fair  Market  Value of the
     fractional  share of Stock,  disregarding  any  restrictions in the case of
     Restricted Stock or Deferred Stock, at such time.

          (j) If the Award granted to a Participant  allows the  Participant  to
     elect to cancel all or any portion of an unexercised Option by exercising a
     related SAR,  then the Option price per share of Stock shall be used as the
     specified  price in Section  5(i),  to determine  the value of the SAR upon
     such exercise; and, in the event of the exercise of such SAR, the Company's
     obligation  in  respect  of such  Option or such  portion  thereof  will be
     discharged by payment of the SAR so exercised.

                                       9
<PAGE>

          (k) If authorized by the Committee in its sole discretion, the Company
     may accept the surrender of the right to exercise any Option  granted under
     the Plan  (whether or not granted  with a related  SAR) as to all or any of
     the shares of Stock as to which the Option is then exercisable, in exchange
     for payment to the  optionee (in cash or shares of Stock valued at the then
     Fair Market  Value) of an amount not to exceed the  difference  between the
     option  price and the then Fair Market Value of the shares as to which such
     right to exercise is surrendered.

                                    SECTION 6

                               PERFORMANCE SHARES

          (a)  The  Committee   shall   determine  a  performance   period  (the
     "Performance  Period")  of  one or  more  years  and  shall  determine  the
     performance  objectives  for  grants  of  Performance  Shares.  Performance
     objectives may vary from  Participant to Participant  and between groups of
     Participants  and  shall  be  based  upon  such  performance   criteria  or
     combination of factors as the Committee may deem  appropriate.  Performance
     Periods may overlap and  Participants may participate  simultaneously  with
     respect to Performance Shares for which different  performance  periods are
     prescribed.

          (b) At the beginning of a  Performance  Period,  the  Committee  shall
     determine  for each Eligible  Individual  or group of Eligible  Individuals
     with respect to that Performance Period the range of dollar values, if any,
     which may be fixed or may vary in accordance with such performance or other
     criteria  specified  by the  Committee,  which shall be paid to an Eligible
     Individual as an Award if the relevant  measure of Company  performance for
     the Performance Period is met.

          (c) If during the course of a  Performance  Period  there  shall occur
     significant  events as  determined  by the  Committee,  including,  but not
     limited to, a reorganization of the Company, which the Committee expects to
     have a substantial  effect on a performance  objective  during such period,
     the Committee may revise such objective.

          (d)  If  a  Participant  terminates  service  with  all  Participating
     Companies during a Performance  Period because of death,  Total Disability,
     or a significant  event, as determined by the Committee,  that  Participant
     shall be entitled to payment in  settlement of each  Performance  Share for
     which the Performance  Period was prescribed (i) based upon the performance
     objectives  satisfied  at the end of such period and (ii)  prorated for the
     portion of the Performance Period during which the Participant was employed
     by any Participating Company; provided,  however, the Committee may provide
     for an earlier  payment in  settlement  of such  Performance  Share in such
     amount  and  under  such  terms  and  conditions  as  the  Committee  deems
     appropriate  or  desirable  with  the  consent  of  the  Participant.  If a
     Participant  terminates  service with all Participating  Companies during a
     Performance Period for any other reason, then such Participant shall not be
     entitled to any payment with respect to that Performance  Period unless the
     Committee shall otherwise determine.

          (e) Each  Performance  Share  may be paid in whole  shares  of  Stock,
     including  Restricted  Stock  or  Deferred  Stock  (together  with any cash
     representing  fractional  shares of Stock),  or cash, or a  combination  of
     Stock and cash either as a lump sum payment or in annual installments,  all
     as the Committee shall  determine,  at the time of grant of the Performance
     Share or otherwise,  commencing as soon as practicable after the end of the
     relevant  Performance  Period.  Any dividends or  distributions  payable on
     Performance  Shares (or the  equivalent  as specified in the grant),  other
     than cash dividends representing the periodic distribution of profits which
     shall be retained  by the  Company,  shall be paid over to the  Participant
     when and if payment is made of the underlying  Performance  Shares,  unless
     the grant provides otherwise.

                                       10
<PAGE>

          Except as otherwise  provided in this Section 6, no Performance Shares
     awarded to Participants  shall be sold,  exchanged,  transferred,  pledged,
     hypothecated or otherwise  disposed of during the Performance Period unless
     the  Committee  determines  that an Award  may be  transferred  to a Family
     Member or Family Trust or other transferee.

                                    SECTION 7

                                RESTRICTED STOCK

          (a)  Restricted  Stock may be received by a  Participant  either as an
     Award or as the result of an exercise of an Option or SAR or as payment for
     a  Performance  Share.  Restricted  Stock shall be subject to a restriction
     period  (after  which  restrictions  shall lapse) which shall mean a period
     commencing on the date the Award is granted and ending on such date or upon
     the  achievement  of such  performance  or other  criteria as the Committee
     shall determine (the "Restriction  Period").  The Committee may provide for
     the lapse of restrictions in installments where deemed appropriate.

          (b)  Except as  otherwise  provided  in this  Section  7, no shares of
     Restricted  Stock  received  by a  Participant  shall be  sold,  exchanged,
     transferred,  pledged,  hypothecated  or  otherwise  disposed of during the
     Restriction  Period  unless the Committee  determines  that an Award may be
     transferred  by a  Participant  to a Family Member or Family Trust or other
     transferee;  provided,  however, the Restriction Period for any Participant
     shall expire and all restrictions on shares of Restricted Stock shall lapse
     upon  the   Participant's   (i)  death,  (ii)  Total  Disability  or  (iii)
     Termination Without Cause where the Participant is immediately  eligible to
     receive  benefits under the terms of Citizens  Pension  Plans,  or with the
     consent of the Company,  or upon some  significant  event, as determined by
     the  Committee,  including,  but not  limited to, a  reorganization  of the
     Company.

          (c) If a  Participant  terminates  employment  with all  Participating
     Companies for any reason other than under the circumstances  referred to in
     clause (b) before the expiration of the Restriction  Period,  all shares of
     Restricted Stock still subject to restriction  shall,  unless the Committee
     otherwise determines within 90 days after such termination, be forfeited by
     the Participant and shall be reacquired by the Company, and, in the case of
     Restricted Stock purchased  through the exercise of an Option,  the Company
     shall refund the purchase price paid on the exercise of the Option.

          (d) The Committee  may require  under such terms and  conditions as it
     deems  appropriate or desirable that the  certificates for Restricted Stock
     delivered  under  the Plan may be held in  custody  until  the  Restriction
     Period  expires or until  restrictions  thereon  otherwise  lapse,  and may
     require  as a  condition  of any  receipt  of  Restricted  Stock  that  the
     Participant  shall have  delivered a stock power endorsed in blank relating
     to the Restricted Stock.

                                       11
<PAGE>

          (e)  Nothing  in this  Section 7 shall  preclude  a  Participant  from
     exchanging  any shares of  Restricted  Stock  subject  to the  restrictions
     contained  herein  for  any  other  shares  of  Stock  that  are  similarly
     restricted.

          (f) Unless the Award Agreement  provides  otherwise,  amounts equal to
     any cash  dividends  representing  the  periodic  distributions  of profits
     declared  and payable  during the  Restriction  Period with  respect to the
     number of shares of Restricted  Stock  credited to a  Participant  shall be
     paid to the Participant within 30 days after each dividend becomes payable,
     unless,  at the  time of the  Award,  the  Committee  determines  that  the
     dividends should be reinvested in additional shares of Restricted Stock, in
     which case additional  shares of Restricted  Stock shall be credited to the
     Participant based on the Stock's Fair Market Value at the time of each such
     dividend,  or unless the Committee  specifies  otherwise.  All dividends or
     distributions  payable on shares  (other than cash  dividends  representing
     periodic  distributions  of profits) of Restricted Stock (or the equivalent
     as specified in the grant) shall be paid over to the  Participant  when and
     if as  restrictions  lapse on the  underlying  shares of Restricted  Stock,
     unless the grant provides otherwise.

                                    SECTION 8

                                 DEFERRED STOCK

          (a) Deferred Stock may be credited to an Eligible Individual either as
     an Award or as the result of an  exercise of an Option or SAR or as payment
     for a  Performance  Share.  Deferred  Stock  shall be subject to a deferral
     period  which  shall  mean a period  commencing  on the  date the  Award is
     granted and ending on such date or upon the achievement of such performance
     or criteria as the Committee shall determine (the "Deferral  Period").  The
     Committee  may  provide  for  the  expiration  of the  Deferral  Period  in
     installments where deemed appropriate.

          (b) Except as otherwise  provided in this Section 8, no Deferred Stock
     credited to Participant  shall be sold,  exchanged,  transferred,  pledged,
     hypothecated or otherwise disposed of during the Deferral Period unless the
     Committee determines that an Award may be transferred to a Family Member or
     Family Trust or other transferee;  provided,  however,  the Deferral Period
     for any Participant  shall expire upon the  Participant's  (i) death,  (ii)
     Total Disability or (iii)  Termination  Without Cause where the Participant
     is  immediately  eligible to receive  benefits  under the terms of Citizens
     Pension Plans,  or an earlier age with the consent of the Company,  or upon
     some significant event, as determined by the Committee,  including, but not
     limited to, a reorganization of the Company.

                                       12
<PAGE>

          (c) At the expiration of the Deferral Period, the Participant shall be
     entitled to receive a certificate  pursuant to Section 10 for the number of
     shares of Stock equal to the number of shares of Deferred Stock credited on
     his or her behalf.  Unless the Award Agreement provides otherwise,  amounts
     equal to any cash  dividends  representing  the periodic  distributions  of
     profits declared and payable during the Deferral Period with respect to the
     number of shares of Deferred Stock credited to a Participant  shall be paid
     to such  Participant  within 30 days after each  dividend  becomes  payable
     unless,  at the time of the  Award,  the  Committee  determined  that  such
     dividends  should be reinvested in additional  shares of Deferred Stock, in
     which case  additional  shares of  Deferred  Stock shall be credited to the
     Participant based on the Stock's Fair Market Value at the time of each such
     dividend,  or unless the Committee  specifies  otherwise.  All dividends or
     distributions  payable on shares  (other than cash  dividends  representing
     periodic  distributions of profits) of Deferred Stock (or the equivalent as
     specified  in the  grant)  shall be paid over to the  Participant  when the
     Deferral Period ends, unless the grant provides otherwise.

          (d) If a  Participant  terminates  employment  with all  Participating
     Companies for any reason other than under the circumstances  referred to in
     clause (b) before the  expiration  of the  Deferral  Period,  all shares of
     Deferred Stock shall, unless the Committee  otherwise  determines within 90
     days after such termination,  be forfeited by the Participant,  and, in the
     case of Deferred  Stock  purchased  through the exercise of an Option,  the
     Company shall refund the purchase price paid on the exercise of the Option.

                                    SECTION 9

                            OTHER STOCK-BASED AWARDS

          Phantom Stock may be credited to an Eligible  Individual  either as an
     Award or as the result of an exercise of an Option or SAR or as payment for
     a  Performance  Share.  Each  share of  Phantom  Stock may be paid in whole
     shares of Stock,  including  Restricted  Stock or Deferred Stock  (together
     with any cash  representing  fractional  shares of  Stock),  or cash,  or a
     combination  of Stock and cash  either as a lump sum  payment  or in annual
     installments, all as the Committee shall determine, at the time of grant of
     the Phantom Stock or otherwise, commencing as soon as practicable after the
     payment date  designated by the Committee.  Any dividends or  distributions
     payable on Phantom  Stock (or the  equivalent  as  specified in the grant),
     other than cash dividends representing the periodic distribution of profits
     which  shall  be  retained  by the  Company,  shall  be  paid  over  to the
     Participant  when and if payment is made of the  underlying  Phantom Stock,
     unless the grant provides otherwise.

          Except as  otherwise  provided  in this  Section 9, no  Phantom  Stock
     awarded to Participants  shall be sold,  exchanged,  transferred,  pledged,
     hypothecated or otherwise disposed of unless the Committee  determines that
     an Award may be  transferred  to a Family  Member or Family  Trust or other
     transferee.

          The  Committee  may  grant  other  Awards  under  the Plan  which  are
     denominated  in stock  units or  pursuant  to which  shares of Stock may be
     acquired, including Awards valued using measures other than market value or
     Fair Market  Value,  if deemed by the  Committee  in its  discretion  to be
     consistent with the purposes of the Plan. Subject to the terms of the Plan,
     the Committee shall determine the form of such Awards, the number of shares
     of Stock to be  granted or covered  pursuant  to such  Awards and all other
     terms and conditions of such Awards.

                                       13

<PAGE>

                                   SECTION 10

                        CERTIFICATES FOR AWARDS OF STOCK

          (a)  Subject to Section  7(d),  each  Participant  entitled to receive
     shares of Stock  under  the Plan  shall be  issued a  certificate  for such
     shares or have their shares registered for their account in book entry form
     by the Company's  transfer  agent.  In the instance of a certificate,  such
     certificate  shall be registered in the name of the Participant,  and shall
     bear an appropriate legend reciting the terms, conditions and restrictions,
     if any,  applicable  to such  shares and shall be  subject  to  appropriate
     stop-transfer orders.

          (b) The  Company  shall not be required to issue or deliver any shares
     or certificates for shares of Stock prior to (i) the listing of such shares
     on any stock  exchange or  quotation  system on which the Stock may then be
     listed  or  quoted,   and  (ii)  the   completion   of  any   registration,
     qualification,  approval or  authorization of such shares under any federal
     or state law, or any ruling or regulation or approval or  authorization  of
     such shares under any  governmental  body which the Company  shall,  in its
     sole discretion, determine to be necessary or advisable.

          (c) All shares and  certificates  for shares of Stock  delivered under
     the Plan  shall  also be  subject  to such  stop-transfer  orders and other
     restrictions   as  the  Committee  may  deem  advisable  under  the  rules,
     regulations,  and other  requirements  of the SEC, any stock  exchange upon
     which  the  Stock  is then  listed  and any  applicable  federal  or  state
     securities  or  regulatory  laws,  and the  Committee may cause a legend or
     legends to be placed on any such certificates to make appropriate reference
     to such restrictions.  The foregoing provisions of this Section 10(c) shall
     not be  effective  if and to the extent that the shares of Stock  delivered
     under  the  Plan are  covered  by an  effective  and  current  registration
     statement  under the Securities  Act, or if the Committee  determines  that
     application  of such  provisions  is no longer  required or  desirable.  In
     making  such  determination,  the  Committee  may rely upon an  opinion  of
     counsel for the Company.

          (d) Except for the  restrictions on Restricted  Stock under Section 7,
     each  Participant  who  receives  an award of Stock  shall  have all of the
     rights of a stockholder with respect to such shares, including the right to
     vote  the  shares  and  receive  dividends  and  other  distributions.   No
     Participant  awarded an Option,  a SAR,  or  Performance  Share or Deferred
     Stock  shall  have any right as a  stockholder  with  respect to any shares
     subject  to such  Award  prior  to the  date of  issuance  to him or her of
     certificate or certificates for such shares.

          No Participant  awarded  Phantom Stock or other share units shall have
     any right as a  stockholder  with respect to any shares whose value is used
     to  determine  the value of such Phantom  Stock or share  units;  provided,
     however,  that this sentence  shall not preclude any Award of Phantom Stock
     or share units from providing dividend  equivalent rights or payouts to the
     Participant  in  the  form  of  shares  of the  Company's  Stock  (and  the
     Participant  shall have full  stockholder  rights with  respect to any such
     paid out shares).

                                       14

<PAGE>

                                   SECTION 11

                                   BENEFICIARY

          (a) Each Eligible  Individual  shall file with the Committee a written
     designation of one or more persons as the Beneficiary who shall be entitled
     to receive the Award, if any, payable under the Plan upon his or her death.
     An  Eligible  Individual  may from time to time revoke or change his or her
     Beneficiary  designation  without the consent of any prior  Beneficiary  by
     filing a new  designation  with the  Committee.  The last such  designation
     received by the Committee shall be controlling;  provided, however, that no
     designation,  or change or revocation  thereof,  shall be effective  unless
     received by the Committee prior to the Eligible  Individual's death, and in
     no event shall it be effective as of a date prior to such receipt.

          (b) If no such Beneficiary  designation is in effect at the time of an
     Employee's  death,  or if no designated  Beneficiary  survives the Eligible
     Individual  or  if  such  designation  conflicts  with  law,  the  Eligible
     Individual's estate shall be entitled to receive the Award, if any, payable
     under the Plan upon his or her death.  If the  Committee  is in doubt as to
     the right of any person to receive such Award,  the Company may retain such
     Award,  without  liability  for any interest  thereon,  until the Committee
     determines  the right  thereto,  or the Company may pay such Award into any
     court of  appropriate  jurisdiction  and such  payment  shall be a complete
     discharge of the liability of the Company therefor.

                                   SECTION 12

                           ADMINISTRATION OF THE PLAN

          (a) The Plan shall be administered  by the Committee,  as appointed by
     the Board and serving at the Board's pleasure. Each member of the Committee
     shall be both a member of the Board and  shall  satisfy  the  "non-employee
     director" or similar  successor  requirements,  if any, of Rule 16b-3 under
     the  Exchange  Act  and  the  "outside   director"  or  similar   successor
     requirements,  if any,  of Section  162(m) of the Code and the  regulations
     promulgated thereunder.

          (b) All decisions,  determinations or actions of the Committee made or
     taken pursuant to grants of authority under the Plan shall be made or taken
     in the sole and absolute  discretion  of the  Committee and shall be final,
     conclusive and binding on all persons for all purposes.

          (c) The Committee  shall have full power,  discretion and authority to
     interpret,  construe and  administer  the Plan and any part thereof and any
     related Award  Agreement  and define the terms  employed in the Plan or any
     agreement,  and its interpretations  and constructions  thereof and actions
     taken thereunder shall be final,  conclusive and binding on all persons for
     all purposes.

          (d) The Committee  shall have full power,  discretion and authority to
     prescribe   and  rescind   rules,   regulations   and   policies   for  the
     administration of the Plan.

                                       15

<PAGE>

          (e) The Committee's  decisions and  determinations  under the Plan and
     with respect to any Award granted thereunder need not be uniform and may be
     made  selectively  among  Awards,  Participants  or  Eligible  Individuals,
     whether or not such  Awards are  similar or such  Participants  or Eligible
     Individuals are similarly situated.

          (f) The  Committee  shall keep minutes of its actions  under the Plan.
     The act of a majority of the members  present at a meeting  duly called and
     held  shall be the act of the  Committee.  Any  decision  or  determination
     reduced to  writing  and signed by all  members of the  Committee  shall be
     fully as effective  as if made by  unanimous  vote at a meeting duly called
     and held.

          (g) The Committee  may employ such legal  counsel,  including  without
     limitation  independent legal counsel and counsel regularly employed by the
     Company,  consultants and agents as the Committee may deem  appropriate for
     the  administration of the Plan and may rely upon any opinion received from
     any such counsel or consultant and any computations  received from any such
     consultant or agent. All expenses incurred by the Committee in interpreting
     and administering the Plan, including without limitation,  meeting fees and
     expenses and professional fees, shall be paid by the Company.

          (h) No member or former  member of the Committee or the Board shall be
     liable for any action or  determination  made in good faith with respect to
     the Plan or any Award granted under it. Each member or former member of the
     Committee  or the  Board  shall be  indemnified  and held  harmless  by the
     Company against all cost or expense  (including  counsel fees and expenses)
     or  liability  (including  any sum paid in  settlement  of a claim with the
     approval  of  the  Board)  arising  out of any  act or  omission  to act in
     connection  with the Plan  unless  arising  out of such  member's or former
     member's own fraud or bad faith. Such indemnification  shall be in addition
     to any rights to  indemnification or insurance the members or former member
     may have as directors or under the by-laws of the Company or otherwise.

          (i) The Committee's  determination  that an Option,  SAR,  Performance
     Share,  Restricted Stock, Deferred Stock or other Stock-based Awards may be
     transferred  by a  Participant  to a Family Member or Family Trust or other
     transferee may be set forth in: determinations pursuant to Section 12(c)

          , rules and  regulations of general  application  adopted  pursuant to
     Section 12(d), in the written Award Agreement, or by a writing delivered to
     the Participant  made any time after the relevant Award or Awards have been
     granted,  on  a  case-by-case  basis,  or  otherwise.  In  any  event,  the
     transferee  or Family  Member or Family  Trust shall agree in writing to be
     bound by all the provisions of the Plan and the Award Agreement,  and in no
     event shall any such  transferee  have greater rights under such Award than
     the Participant effecting such transfer.

          (j) With respect to credits,  shares,  cash or other property credited
     to a Participant by reason of dividends or distributions,  if the Committee
     shall so determine,  all such credits,  shares, cash or other property to a
     Participant shall be paid to the Participant periodically at the end of the
     applicable  period,  whether or not the  performance,  employment  or other
     standards (or lapse of time) upon which such Award is conditioned have been
     satisfied.  In addition,  the  Committee  may determine to include in Award
     Agreements  granting Options and SARs a provision to the effect that (a) an
     amount  equal to any  dividends  (payable in cash or other  property)  paid
     after the grant of the  Option or SAR and  before to the  exercise  of such
     Option or SAR with respect to the number of shares of Stock subject to such
     Option  or SAR  shall  be  credited  to a  Participant  and,  if the  Award
     Agreement so provides,  thereafter paid to such Participant  within 30 days
     after each dividend becomes payable or, (b) if the Committee so determines,
     such Award shall be reinvested in additional shares of Stock, in which case
     such additional  shares of Stock shall be credited to the Participant based
     on the  Stock's  Fair  Market  Value at the time of  payment  of each  such
     dividend.  In the  latter  event,  if the  Committee  so  determines,  such
     additional  shares of Stock shall be delivered to the Participant  (whether
     or not such Option or SAR is exercised) at the time that such Option or SAR
     ceases to be exercisable in accordance with its terms or otherwise.

                                       16

<PAGE>

                                   SECTION 13

                           AMENDMENT OR DISCONTINUANCE

          The Board may, at any time,  amend or terminate the Plan. The Plan may
     also be amended by the Committee,  provided that all such amendments  shall
     be reported to the Board.  No  amendments  shall  become  effective  unless
     approved by affirmative vote of the Company's stockholders if such approval
     is necessary or desirable for the continued  validity of the Plan or if the
     failure to obtain such approval  would  adversely  affect the compliance of
     the Plan with Rule 16b-3 or any  successor  rule under the  Exchange Act or
     Section 162(m) of the Code or any other rule or regulation. No amendment or
     termination  shall, when taken as a whole,  adversely and materially affect
     the rights of any Participant  who has received a previously  granted Award
     without his or her consent unless the amendment or termination is necessary
     or desirable for the continued  validity of the Plan or its compliance with
     Rule 16b-3 or any other applicable law, rule or regulation or pronouncement
     or to avoid any adverse  consequences  under Section  162(m) of the Code or
     any  requirement  of a securities  exchange or association or regulatory or
     self-regulatory body).

                                   SECTION 14

                 ADJUSTMENTS IN EVENT OF CHANGE IN COMMON STOCK

          In the event of a change in corporate  capitalization,  stock split or
     stock dividend, the number of shares purchasable upon exercise of an Option
     or SAR shall be increased to the new number of shares which result from the
     shares covered by the Option or SAR immediately before the change, split or
     dividend. The purchase price per share shall be reduced proportionately and
     the total purchase price will remain the same.

                                       17
<PAGE>

          In the event of any other  change in  corporate  capitalization,  or a
     corporate  transaction,  such as any merger of a  corporation  into another
     corporation,  any  consolidation of two or more  corporations  into another
     corporation,  any separation of a corporation (including a spinoff or other
     distribution of stock or property by a corporation),  any reorganization of
     a  corporation  (whether  or  not  such  reorganization  comes  within  the
     definition  of such term in  Section  368 of the Code),  or any  partial or
     complete  liquidation  by a corporation  or other similar event which could
     distort  the   implementation  of  the  Plan  or  the  realization  of  its
     objectives,  the  Committee  shall make an  appropriate  adjustment  in the
     number of shares of Stock (i) which are covered by the Plan, (ii) which may
     be  granted to any one  Eligible  Individual  and which are  subject to any
     Award,  and the  purchase  price  therefor,  and in  terms,  conditions  or
     restrictions  on  securities  as the Committee  deems  equitable,  with the
     objective that the  securities  covered under the Plan or an Award shall be
     those securities  which a Participant  would have received if he or she had
     exercised  his or her Option or SAR prior to the event or been  entitled to
     his or her Restricted or Deferred Stock or Performance Shares.

          All such events occurring between the effective date of the Option and
     its exercise shall result in an adjustment to the Option terms.

                                   SECTION 15

                                CHANGE IN CONTROL

          Awards may include,  or may incorporate  from any relevant  guidelines
     adopted  by the  Committee,  terms  which  provide  that  any or all of the
     following actions or consequences,  with any  modifications  adopted by the
     Committee,  may occur as a result of, or in anticipation  of, any Change in
     Control to assure fair and equitable treatment of Participants:

               (a) Any Options outstanding at least six months as of the date of
          Change in Control shall, if held by a current employee of the Company,
          become immediately  exercisable in full. In addition, all Participants
          may, regardless of whether still an employee of the Company,  elect to
          cancel all or any portion of any Option or Award no later than 90 days
          after the Change in Control,  in which event the Company  shall pay to
          such electing  Participant,  an amount in cash equal to the excess, if
          any, of the Current  Market Value (as defined  below) of the shares of
          Stock,  including  Performance  Shares,  Restricted  Stock or Deferred
          Stock,  subject to the Option or of the  portion  thereof so  canceled
          over the option  price for such  shares;  provided,  however,  that no
          Participant  shall  have the right to elect  cancellation  unless  and
          until at least 6 months  have  elapsed  after the date of grant of the
          Option.

               (b) Any  Performance  Periods shall end and the Company shall pay
          each  Participant  an  amount  in  cash  equal  to the  value  of such
          Participant's  performance  shares,  if any,  based  upon the  Stock's
          Current Market Value in full settlement of such performance shares.

               (c) Any  Restriction  Periods shall end and the Company shall pay
          each  Participant  an amount in cash equal to the Current Market Value
          of the Restricted  Stock held by, or on behalf of, each Participant in
          exchange for such Restricted Stock.

               (d) Any Deferral  Period  shall end and the Company  shall pay to
          each  Participant  an amount in cash equal to the Current Market Value
          of the  number  of shares  of Stock  equal to the  number of shares of
          Deferred Stock credited to such  Participant in full settlement of any
          Deferred Stock Award.

               (e) The Company shall pay to each Participant all amounts due, if
          any,  deferred by or payable under Awards granted to such  Participant
          under the Plan which are not Performance  Shares,  Restricted Stock or
          Deferred Stock, in accordance with the terms provided by the Committee
          at the time of deferral or grant.

                                       18
<PAGE>

               (f) For purpose of this Section 15,  "Current Market Value" means
          the highest  Fair Market Value  during the period  commencing  30 days
          prior to the Change in Control  and ending 30 days after the Change in
          Control (the  "reference  period");  provided  that,  if the Change in
          Control occurs as a result of a tender offer or exchange  offer,  or a
          merger,  purchase of assets or stock, or another transaction  approved
          by shareholders of the Company,  Current Market Value means the higher
          of (i) the highest Fair Market Value during the reference  period,  or
          (ii) the highest price paid per share of Stock pursuant to such tender
          offer, exchange offer or transaction.

                                   SECTION 16

                                  MISCELLANEOUS

               (a)  Nothing in this Plan or any Award  granted  hereunder  shall
          confer  upon any  employee  any right to continue in the employ of any
          Participating  Company or  interfere  in any way with the right of any
          Participating Company to terminate his or her employment at any time.

               (b) No Award  payable  under the Plan  shall be deemed  salary or
          compensation for the purpose of computing  benefits under any employee
          benefit plan or other arrangement of any Participating Company for the
          benefit of its employees unless the Company shall determine otherwise.

               (c) No Eligible Individual or Participant shall have any claim to
          an Award until it is actually  granted  under the Plan.  To the extent
          that any person acquires a right to receive  payments from the Company
          under this Plan,  such right shall be no greater  than the right of an
          unsecured  general  creditor of the  Company.  All  payments of Awards
          provided  for under the Plan  shall be paid by the  Company  either by
          issuing  shares of Stock or by delivering  cash from the general funds
          of the Company or other  property of the Company;  provided,  however,
          that such payments shall be reduced by the amount of any payments made
          to the Participant or his or her dependents,  beneficiaries  or estate
          from any trust or special or separate fund  established  in connection
          with this Plan.  The  Company  shall not be  required  to  establish a
          special or separate fund or other segregation of assets to assure such
          payments,  and, if the Company shall make any investments to aid it in
          meeting  its  obligations  hereunder,  the  Participant  shall have no
          right,  title,  or  interest  whatever  in or to any such  investments
          except as may  otherwise be expressly  provided in a separate  written
          instrument relating to such investments.

               (d) Absence on leave  approved by a duly  constituted  officer of
          the Company shall not be considered  interruption  or  termination  of
          employment for any purposes of the Plan;  provided,  however,  that no
          Award  may be  granted  to an  employee  while he or she is  absent on
          leave.

               (e) If the  Committee  shall  find  that any  person  to whom any
          Award, or portion thereof, is payable under the Plan is unable to care
          for his or her affairs because of illness or accident,  or is a minor,
          then any payment due him or her  (unless a prior  claim  therefor  has
          been  made  by a duly  appointed  legal  representative)  may,  if the
          Committee  so directs the  Company,  be paid to his or her  spouse,  a
          child,  a relative,  an  institution  maintaining or having custody of
          such  person,  or any other  person  deemed by the  Committee  to be a
          proper  recipient  on  behalf of such  person  otherwise  entitled  to
          payment.  Any  such  payment  shall  be a  complete  discharge  of the
          liability of the Company therefor.

                                       19
<PAGE>

               (f) The  right of any  Participant  or other  person to any Award
          payable  under the Plan may not be assigned,  transferred,  pledged or
          encumbered,  either  voluntarily  or by  operation  of law,  except as
          provided  in  Section  11  with  respect  to  the   designation  of  a
          Beneficiary  or as may  otherwise  be required by law or pursuant to a
          qualified  domestic  relations order as defined by the Code or Title I
          of  the  Employee   Retirement  Income  Security  Act,  or  the  rules
          thereunder  or unless the  Committee  determines  that an Award may be
          transferred  to a Family  Member or Family Trust or other  transferee.
          If,  by reason  of any  attempted  assignment,  transfer,  pledge,  or
          encumbrance  or any  bankruptcy or other event  happening at any time,
          any amount  payable  under the Plan would be made subject to the debts
          or liabilities of the  Participant or his or her  Beneficiary or would
          otherwise  devolve  upon  anyone  else  and  not  be  enjoyed  by  the
          Participant or his or her  Beneficiary or transferee,  Family Trust or
          Family Member, then the Committee may terminate such person's interest
          in any such payment and direct that the same be held and applied to or
          for the benefit of the  Participant,  his or her  Beneficiary,  taking
          into account the expressed wishes of the Participant (or, in the event
          of his or her death,  those of his or her  Beneficiary) in such manner
          as the Committee may deem proper.

               (g) Copies of the Plan and all amendments,  administrative  rules
          and procedures and interpretations  shall be made available for review
          to all Eligible  Individuals at all reasonable  times at the Company's
          administrative offices.

               (h) The Committee may cause to be made, as a condition  precedent
          to the payment of any Award,  or otherwise,  appropriate  arrangements
          with the Participant or his or her Beneficiary, for the withholding of
          any federal,  state,  local or foreign taxes. The Committee may in its
          discretion permit the payment of such withholding taxes by authorizing
          the  Company  to  withhold  shares  of  Stock  to be  issued,  or  the
          Participant  to deliver to the  Company  shares of Stock  owned by the
          Participant or Beneficiary,  in either case having a Fair Market Value
          equal to the  amount of such  taxes,  or  otherwise  permit a cashless
          exercise.

               (i) All elections, designations,  requests, notices, instructions
          and other  communications  from an Eligible  Individual,  Participant,
          Beneficiary  or other person to the  Committee,  required or permitted
          under the Plan,  shall be in such form as is  prescribed  from time to
          time by the  Committee  and  shall be mailed  by first  class  mail or
          transmitted  by facsimile  copy or delivered to such location as shall
          be specified by the Committee.

               (j) The terms of the Plan shall be binding  upon the  Company and
          its successors and assigns.

               (k) Captions preceding the sections hereof are inserted solely as
          a matter  of  convenience  and in no way  define or limit the scope or
          intent of any provision hereof.

               (l) The Plan and the grant,  exercise  and carrying out of Awards
          shall be subject to all applicable  federal and state laws, rules, and
          regulations and to all required or otherwise appropriate approvals and
          authorizations by any governmental or regulatory agency or commission.
          The Company shall have no  obligation  of any nature  hereunder to any
          Eligible Individual, Participant or any other person in the absence of
          all necessary or desirable  approvals or authorizations and shall have
          no obligation to seek or obtain the same.

                                       20
<PAGE>

               (m) Whenever possible,  each provision of this Plan and any Award
          Agreement  will be  interpreted  in such manner as to be effective and
          valid under  applicable  law, but if any such  provision is held to be
          ineffective,  invalid,  illegal or  unenforceable in any respect under
          the applicable  laws or regulations of the United States or any state,
          such ineffectiveness,  invalidity, illegality or unenforceability will
          not affect any other  provision  but this Plan and any such  agreement
          will be reformed, construed and enforced so as to carry out the intent
          hereof or thereof and as if any invalid or illegal provision had never
          been contained herein.

               (n) The Committee, in its discretion, may defer the payment of an
          Award,  if such  payment  would  cause the  annual  remuneration  of a
          Participant,  who is a covered  employee  under Section  162(m) of the
          Code, to exceed $1,000,000.

               (o) The Plan shall be construed  and  governed  under the laws of
          the State of Delaware.

                                   SECTION 17

                     EFFECTIVE DATE AND STOCKHOLDER APPROVAL

          The  Effective  Date of the Plan  shall be May 18,  2000,  subject  to
     approval by the holders of a majority of the Company's  common stock at the
     2001 Annual  Meeting.  Any Awards  granted prior to the 2001 Annual Meeting
     will be subject to the receipt of such approval.  No Awards will be granted
     under the Plan after the expiration of ten years from the Effective Date.

                                       21

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