Document:

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                                                                  EXHIBIT 10.26

                                                                 EXECUTION COPY

                                FOURTH AMENDMENT

     This FOURTH AMENDMENT (this "AMENDMENT"), dated as of March 15, 2002, is
entered into by and among Huntsman International LLC (f/k/a Huntsman ICI
Chemicals LLC), a Delaware limited liability company (the "BORROWER"), Huntsman
International Holdings LLC (f/k/a Huntsman ICI Holdings LLC), a Delaware limited
liability company ("HOLDINGS"), the undersigned financial institutions,
including Bankers Trust Company, in their capacities as lenders hereunder
(collectively, the "LENDERS," and each individually, a "LENDER"), Bankers Trust
Company, as Lead Arranger, Administrative Agent ("ADMINISTRATIVE AGENT") for the
Lenders and Sole Book Manager, Goldman Sachs Credit Partners L.P., as
Syndication Agent and Co-Arranger and The Chase Manhattan Bank and UBS Warburg
LLC (as successor to Warburg Dillon Read), as Co-Arrangers and as
Co-Documentation Agents (collectively, the "AGENTS" and each individually, an
"AGENT"). Terms used herein and not otherwise defined herein shall have the same
meanings as specified in the Credit Agreement (as defined below).

                                    RECITALS:

     A.   The Borrower, Holdings, the Lenders, the Agents and the Administrative
Agent have heretofore entered into that certain Credit Agreement dated as of
June 30, 1999, as amended by that certain First Amendment dated as of December
21, 2000, that certain Second Amendment dated as of March 5, 2001 and that
certain Third Amendment dated as of November 30, 2001 (as amended, restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT").

     B.   The Borrower and Holdings wish, and the Lenders signatory hereto and
the Agents and Administrative Agent are willing, to amend the Credit Agreement
subject to the terms and conditions of this Agreement.

     C.   This Agreement constitutes a Loan Document and these Recitals shall be
construed as part of this Agreement.

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

     SECTION 1. AMENDMENT OF CREDIT AGREEMENT.

     The Credit Agreement is hereby amended as of the Fourth Amendment Effective
Date as follows:

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     (a)  SECTION 1.1 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING THE
FOLLOWING DEFINITIONS IN THEIR PROPER ALPHABETICAL ORDER:

     "ARGENTINIAN NON-CASH CHARGES" means for any period of four consecutive
fiscal quarters that includes the first or second quarter of Fiscal Year 2002,
any one-time actual non-cash write down charges incurred in the first or second
quarter of Fiscal Year 2002 in connection with the Borrower's polyurethane
assets in Argentina in an amount not to exceed $7 million for such first and
second quarter of Fiscal Year 2002.

     "FOURTH AMENDMENT" means that certain Fourth Amendment to this Agreement
dated as of March 15, 2002.

     "FOURTH AMENDMENT EFFECTIVE DATE" has the meaning set forth in SECTION 3 of
the Fourth Amendment.

     "MINIMUM SENIOR NOTES PROCEEDS DATE" means the date on which the Borrower
has received gross proceeds of at least $175 million from the issuance of Senior
Notes the Net Offering Proceeds of which are applied in accordance with SECTIONS
4.4(m) AND 4.5(e).

     "SENIOR NOTES" means those senior unsecured notes of Borrower due no
earlier than January 1, 2009 issued pursuant to the Senior Note Documents.

     "SENIOR NOTE DOCUMENTS" means any indenture or other agreement to be
entered into by Borrower, pursuant to which Borrower will incur unsecured
Indebtedness permitted by SECTION 8.2(v).

     (b)  EFFECTIVE AS OF THE FOURTH AMENDMENT EFFECTIVE DATE THROUGH THE
MINIMUM SENIOR NOTE PROCEEDS DATE, THE DEFINITION OF "APPLICABLE BASE RATE
MARGIN" IN SECTION 1.1. OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING
THE FOLLOWING NEW PROVISO THERETO IMMEDIATELY AT THE END THEREOF:

          ";PROVIDED, HOWEVER, during the period from the Fourth Amendment
Effective Date through and including the Minimum Senior Note Proceeds Date, .25%
shall be added to each percentage contained in the above table."

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     (c)  EFFECTIVE AS OF THE MINIMUM SENIOR NOTE PROCEEDS DATE, THE DEFINITION
OF "APPLICABLE BASE RATE MARGIN" IN SECTION 1.1. OF THE CREDIT AGREEMENT IS
HEREBY AMENDED BY DELETING IN ITS ENTIRETY THE LAST ROW OF THE TABLE WHICH
APPEARS IN SUCH DEFINITION AND REPLACING IT WITH THE FOLLOWING TWO NEW ROWS AND
BY DELETING IN ITS ENTIRETY THE SENTENCE APPEARING AFTER SUCH TABLE AND BY
REPLACING IT WITH THE FOLLOWING NEW SENTENCE:

<Table>
<Caption>
                                            APPLICABLE BASE
                                             RATE MARGIN
                                             FOR DOMESTIC
                                            REVOLVING LOANS,
                                             MULTICURRENCY        APPLICABLE        APPLICABLE
                                            REVOLVING LOANS       BASE RATE         BASE RATE
             MOST RECENT                      AND TERM A          MARGIN FOR        MARGIN FOR
           LEVERAGE RATIO                    DOLLAR LOANS        TERM B LOANS     TERM C LOANS
--------------------------------------      ----------------     ------------     -------------
<S>                                         <C>                  <C>              <C>
Equal to or greater than 5.50 to 1 but            2.00%              2.50%            2.75%
       less than 6.50 to 1

Equal to or greater than 6.50 to 1                2.00%              2.75%            3.00%
</Table>

     For purposes of computing the Applicable Base Rate Margin for the period
beginning on the Minimum Senior Notes Proceeds Date until delivery of the
financial statements for the fiscal quarter ended March 31, 2002, the Most
Recent Leverage Ratio shall be deemed to be the highest level on the above
table."

     (d)  EFFECTIVE AS OF THE FOURTH AMENDMENT EFFECTIVE DATE THROUGH THE
MINIMUM SENIOR NOTE PROCEEDS DATE, THE DEFINITION OF "APPLICABLE EUROCURRENCY
MARGIN" IN SECTION 1.1. OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING THE
FOLLOWING NEW PROVISO THERETO IMMEDIATELY AT THE END THEREOF:

          ";PROVIDED, HOWEVER, during the period from the Fourth Amendment
Effective Date through and including the Minimum Senior Note Proceeds Date, .25%
shall be added to each percentage contained in the above listed table."

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     (e)  EFFECTIVE AS OF THE MINIMUM SENIOR NOTE PROCEEDS DATE, THE DEFINITION
OF "APPLICABLE EUROCURRENCY MARGIN" IN SECTION 1.1. OF THE CREDIT AGREEMENT IS
HEREBY AMENDED BY DELETING IN ITS ENTIRETY THE LAST ROW OF THE TABLE WHICH
APPEARS IN SUCH DEFINITION AND REPLACING IT WITH THE FOLLOWING TWO NEW ROWS AND
BY DELETING IN ITS ENTIRETY THE SENTENCE APPEARING AFTER SUCH TABLE AND BY
REPLACING IT WITH THE FOLLOWING NEW SENTENCE:

<Table>
<Caption>
                                             APPLICABLE
                                            EUROCURRENCY
                                                MARGIN             APPLICABLE
                                             FOR DOMESTIC         EUROCURRENCY
                                            REVOLVING LOANS,          MARGIN
                                             MULTICURRENCY         FOR TERM A
                                            REVOLVING LOANS      EURO LOANS AND       APPLICABLE        APPLICABLE
                                              (IN DOLLARS)          NON-DOLLAR       EUROCURRENCY      EUROCURRENCY
          MOST RECENT                         AND TERM A          MULTICURRENCY       MARGIN FOR        MARGIN FOR
         LEVERAGE RATIO                      DOLLAR LOANS        REVOLVING LOANS     TERM B LOANS      TERM C LOANS
--------------------------------------      ----------------     ---------------     -------------     -------------
<S>                                         <C>                  <C>                 <C>               <C>
Equal to or greater than 5.50                   3.25%                3.25%              3.75%              4.00%
  to 1 but less than 6.50 to 1

Equal to or greater than 6.50 to 1              3.25%                3.25%              4.00%              4.25%
</Table>

     For purposes of computing the Applicable Eurocurrency Margin for the period
beginning on the Minimum Senior Notes Proceeds Date until delivery of the
financial statements for the fiscal quarter ended March 31, 2002, the Most
Recent Leverage Ratio shall be deemed to be the highest level on the above
table."

     (f)  THE DEFINITION OF "ASSET DISPOSITION" IN SECTION 1.1. OF THE CREDIT
AGREEMENT IS HEREBY AMENDED BY ADDING THE LANGUAGE "OR SECTION 8.3(k)"
IMMEDIATELY FOLLOWING THE PARENTHETICAL WHICH APPEARS IN THE PROVISO THEREIN.

     (g)  THE DEFINITION OF "CONSOLIDATED EBITDA" IN SECTION 1.1 OF THE CREDIT
AGREEMENT IS HEREBY AMENDED BY DELETING THE "AND" IMMEDIATELY PRECEDING THE
"(IV)" IN SUCH DEFINITION, BY REPLACING THE SAME WITH A "," AND BY ADDING THE
FOLLOWING NEW LANGUAGE IMMEDIATELY AT THE END OF SUCH DEFINITION:

          "and (v) Argentinian Non-Cash Charges."

     (h)  A NEW SECTION 4.4(m) SHALL BE ADDED TO THE CREDIT AGREEMENT TO READ AS
FOLLOWS:

          "(m) MANDATORY PREPAYMENT UPON ISSUANCE OF SENIOR NOTES. On the
Business Day of receipt of the Net Offering Proceeds of any Senior Notes
permitted by SECTION 8.2(v) hereof, the Borrower shall make a mandatory
prepayment equal to 100% of such Net Offering Proceeds, such amount to be
applied (i) with respect to the first $300 million of any

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such Net Offering Proceeds received within forty-five (45) Business Days of the
Fourth Amendment Effective Date, in the manner set forth in SECTION 4.5(e)(i);
and (ii) with respect to any amounts of such Net Offering Proceeds in excess of
$300 million or with respect to any such Net Offering Proceeds received after
the date which is forty-five (45) Business Days following the Fourth Amendment
Effective Date, in the manner set forth in SECTION 4.5(e)(ii) (subject in each
case to modification of such application as set forth in SECTION 4.5(c)). For
purposes of this SECTION 4.4(m), any offering of Senior Notes subsequent to an
initial offering shall be treated on a cumulative basis with incremental amounts
applied in the manner set forth above."

     (i)  SECTION 4.5(c) OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING THE
FOLLOWING NEW LANGUAGE THERETO IMMEDIATELY FOLLOWING THE LANGUAGE "SECTION 4.3,
4.4(e),(f),(g),(h),(i),(j),(k) AND (l)":

          "and SECTION 4.4(m)"

     (j)  SECTION 4.5(c) OF THE CREDIT AGREEMENT IS HEREBY FURTHER AMENDED BY
DELETING THE LAST SENTENCE THEREOF AND BY ADDING THE FOLLOWING NEW LAST SENTENCE
THERETO:

          "In the event of any Waivable Prepayment arising from (A) a prepayment
required under SECTIONS 4.3, 4.4(e), (f), (g), (h), (i), (j), (k) AND (l), the
Administrative Agent shall apply one hundred percent (100%) of the amount so
waived, if any, by such Term B Lender or Term C Lender to the Term A Loans in
accordance with the penultimate sentence of SECTION 4.3(a) or in accordance with
this SECTION 4.5, as the case may be and (B) a prepayment required under SECTION
4.4(m), the Administrative Agent shall apply one hundred percent (100%) of the
amount so waived, if any, by such Term B Lender or Term C Lender to the Term A
Loans in the same manner as required by SECTION 4.5(e)(i)(A)."

     (k)  A NEW SECTION 4.5(e) SHALL BE ADDED TO THE CREDIT AGREEMENT TO READ AS
FOLLOWS:

          "(e) SENIOR NOTES PREPAYMENTS. (i) Any prepayment of principal
required to be made by the Borrower pursuant to SECTION 4.4(m)(i) shall be
applied (A) 60% to the Term A Loans with such amount applied first, on a pro
rata basis, to the amount of the Scheduled Term A Dollar Repayments and the
Dollar Equivalent of the Scheduled Term A Euro Repayments due in calendar years
2002 and 2003 in direct order of maturity, and thereafter, shall be applied to
reduce the Dollar Equivalent of the then remaining Scheduled Term A Dollar
Repayments and Scheduled Term A Euro Repayments on a pro rata basis (based upon
the then remaining principal amount of such Scheduled Term A Dollar Repayments
and Scheduled Term A Euro Repayments, respectively); (B) 10% to the Term B Loans
with such amount applied, subject to a waiver of prepayments pursuant to SECTION
4.5(c), first to the Scheduled Term B Repayments due in calendar years 2002 and
2003 in direct order of maturity, and thereafter, any remaining amounts under
this CLAUSE (B) shall be applied pro rata to the remaining Scheduled Term B
Repayments; (C) 10% to the Term C Loans with such amount applied, subject to a
waiver of prepayments pursuant to SECTION 4.5(c), first to the Scheduled Term C
Repayments due in calendar years 2002 and 2003 in direct order of maturity, and
thereafter, any remaining amounts shall be applied pro rata to the remaining
Scheduled Term C Repayments; and (D) 20%

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to reduce pro rata the outstanding balance of the Domestic Revolving Loans and
Multicurrency Revolving Loans (in each case without any permanent reduction in
the applicable Commitment). All prepayments shall include payment of accrued
interest on the principal amount so prepaid and shall include amounts payable,
if any, under SECTION 3.5. All payments received in Dollars which are required
to be applied in Euros and/or Sterling shall be converted to Euros or Sterling,
as the case may be, at the Spot Rate on the date of such prepayment.

     (ii) Any prepayment of principal required to be made by the Borrower
pursuant to SECTION 4.4(m)(ii) shall be applied, subject to a waiver of
prepayments pursuant to SECTION 4.5(c), to reduce the Dollar Equivalent of the
then remaining Scheduled Repayments, pro rata to such remaining Scheduled
Repayments (based upon the then remaining principal amount of each Facility of
Term Loans)."

     (l)  SECTION 7.8 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING THE
PHRASE "USE COMMERCIALLY REASONABLE EFFORTS TO" TO SUCH SECTION IMMEDIATELY
AFTER THE WORD "SHALL" IN THE LAST SENTENCE THEREOF.

     (m)  SECTION 8.2(h) OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING THE
FOLLOWING NEW PROVISO IMMEDIATELY AT THE END THEREOF:

          "PROVIDED, FURTHER, that notwithstanding anything else in this SECTION
8.2(h) to the contrary, Indebtedness of Tioxide Southern Africa (Propriety) Ltd.
may be refinanced in an amount not in excess of the Dollar Equivalent on the
Initial Borrowing Date of the amount of the Indebtedness of such Subsidiary set
forth on SCHEDULE 8.2(b) provided that such Indebtedness is in no way guaranteed
by the Borrower or any Subsidiary of the Borrower."

     (n)  SECTION 8.2 OF THE CREDIT AGREEMENT IS HEREBY FURTHER AMENDED BY
DELETING THE "AND" AT THE END OF CLAUSE (t) THEREOF, BY DELETING THE "." AT THE
END OF CLAUSE (u) THEREOF AND BY REPLACING IT WITH AN "; AND" AND BY ADDING THE
FOLLOWING NEW CLAUSE (v) THERETO:

          "(v) Indebtedness of the Borrower in respect of Senior Notes in a
principal amount not in excess of $500 million incurred so long as at the time
of incurrence thereof (x) no Unmatured Event of Default or Event of Default
exists, (y) the Borrower would remain in compliance with SECTION 9.3 and 9.4
after giving pro forma effect to the incurrence of any such Indebtedness and
prepayment of Indebtedness hereunder, and (z) the Borrower shall comply with the
mandatory prepayment provisions of SECTION 4.4(m); PROVIDED, HOWEVER, such
Indebtedness shall be on terms and conditions substantially as set forth on the
term sheet attached as EXHIBIT A to the Fourth Amendment with such modifications
thereto and other terms and conditions as approved by the Administrative Agent
(and at or below a market interest rate for comparable instruments)."

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     (o)  SECTION 8.3(k) OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING THE
FOLLOWING NEW CLAUSE (z) IMMEDIATELY BEFORE THE PHRASE "OR II" IN THE
PARENTHETICAL THEREIN:

          "or (z) a Foreign Subsidiary transferring assets which then serve as
direct collateral for a Foreign Intercompany Note to another Foreign Subsidiary
unless such assets similarly secure a Foreign Intercompany Note of such Foreign
Subsidiary receiving such assets"

     (p)  SECTION 8.11 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY ADDING THE
LANGUAGE "OR THE SENIOR NOTES" TO CLAUSE (i) THEREOF IMMEDIATELY AT THE END OF
SUCH CLAUSE AND BY ADDING THE LANGUAGE "OR THE SENIOR NOTE DOCUMENTS" TO CLAUSE
(ii) THEREOF IMMEDIATELY AFTER THE PHRASE "SENIOR SUBORDINATED NOTES DOCUMENT".

     (q)  SECTION 9.2 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY DELETING THE
FIGURE "$965,000,000" AND THE PHRASE "THE INITIAL BORROWING DATE" THEREFROM AND
BY REPLACING THE SAME WITH "$1,000,000,000" AND "JANUARY 1, 2002", RESPECTIVELY.

     (r)  SECTION 9.3 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY DELETING SUCH
SECTION IN ITS ENTIRETY AND BY REPLACING IT WITH THE FOLLOWING NEW SECTION 9.3:

          "9.3 INTEREST COVERAGE RATIO

     Neither Holdings nor the Borrower will permit the Interest Coverage Ratio
calculated for any Test Period ending at the following dates or during the
follow periods to be less than the ratio set forth opposite such period:

<Table>
<Caption>
     PERIOD                                                RATIO
     ------                                                -----
<S>                                                      <C>
     January 1, 2002 to March 31, 2002                   1.40 to 1.0
     April 1, 2002 to June 30, 2002                      1.40 to 1.0
     July 1, 2002 to September 30, 2002                  1.40 to 1.0
     October 1, 2002 to December 31, 2002                1.50 to 1.0
     January 1, 2003 to March 31, 2003                   1.75 to 1.0
     April 1, 2003 to June 30, 2003                      2.00 to 1.0
     July 1, 2003 to September 30, 2003                  2.15 to 1.0
     October 1, 2003 to December 31, 2003                2.35 to 1.0
     January 1, 2004 and thereafter                      2.75 to 1.0

</Table>

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          ;PROVIDED, HOWEVER, in the event that the Minimum Senior Notes
Proceeds Date has not occurred by June 30, 2002, the following ratios and
periods shall be used in lieu of the above ratios and periods:

<Table>
<Caption>
     PERIOD                                                RATIO
     ------                                                -----
<S>                                                      <C>
     January 1, 2002 to March 31, 2002                   1.40 to 1.0
     April 1, 2002 to June 30, 2002                      1.40 to 1.0
     July 1, 2002 to September 30, 2002                  1.95 to 1.0
     October 1, 2002 to December 31, 2002                2.10 to 1.0
     January 1, 2003 to March 31, 2003                   2.50 to 1.0
     April 1, 2003 and thereafter                        2.75 to 1.0
</Table>

     (s)  SECTION 9.4 OF THE CREDIT AGREEMENT IS HEREBY AMENDED BY DELETING SUCH
SECTION IN ITS ENTIRETY AND BY REPLACING IT WITH THE FOLLOWING NEW SECTION 9.4:

          "9.4 LEVERAGE RATIO.

     The Borrower will not permit for any Test Period ending on a date set forth
during any period described below, the Leverage Ratio to exceed the ratio set
forth opposite such period:

<Table>
<Caption>
     PERIOD                                                RATIO
     ------                                                -----
<S>                                                      <C>
     January 1, 2002 to March 31, 2002                   8.25 to 1.0
     April 1, 2002 to June 30, 2002                      8.50 to 1.0
     July 1, 2002 to September 30, 2002                  8.25 to 1.0
     October 1, 2002 to December 31, 2002                7.00 to 1.0
     January 1, 2003 to March 31, 2003                   6.25 to 1.0
     April 1, 2003 to June 30, 2003                      5.50 to 1.0
     July 1, 2003 to September 30, 2003                  4.75 to 1.0
     October 1, 2003 to December 31, 2003                4.25 to 1.0
     January 1, 2004 and thereafter                      3.75 to 1.0
</Table>

          ;PROVIDED, HOWEVER, in the event that the Minimum Senior Notes
Proceeds Date has not occurred by June 30, 2002, the following ratios and
periods shall be used in lieu of the above ratios and periods:

<Table>
<Caption>
     PERIOD                                                RATIO
     ------                                                -----
<S>                                                      <C>
     January 1, 2002 to March 31, 2002                   8.25 to 1.0
     April 1, 2002 to June 30, 2002                      8.50 to 1.0
     July 1, 2002 to September 30, 2002                  5.90 to 1.0
     October 1, 2002 to December 31, 2002                5.40 to 1.0
     January 1, 2003 to March 31, 2003                   4.75 to 1.0
     April 1, 2003 to June 30, 2003                      4.00 to 1.0
     July 1, 2003 and thereafter                         3.75 to 1.0
</Table>

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     SECTION 2. CONSENT AND ACKNOWLEDGMENT. Pursuant to SECTIONS 12.15(a) AND
12.15(b) of the Credit Agreement, the Lenders hereby instruct Administrative
Agent and the Collateral Agent to enter into that certain Amendment No. 1 to
Collateral Security Agreement, in substantially the form of EXHIBIT B hereto
(the "COLLATERAL SECURITY AGREEMENT AMENDMENT") which Collateral Security
Agreement Amendment shall amend the Collateral Security Agreement to make
changes thereto necessary or desirable to conform the terms of the Collateral
Security Agreement to the provisions of revised Article IX of the Uniform
Commercial Code.

     SECTION 3. CONDITIONS TO EFFECTIVENESS OF THE AMENDMENT. The provisions of
this Amendment shall become effective upon the date of the satisfaction of all
of the conditions set forth in this SECTION 3 (the "FOURTH AMENDMENT EFFECTIVE
DATE"):

     3.1  PROPER EXECUTION AND DELIVERY OF AMENDMENT. Borrower, Holdings, the
Administrative Agent and the Required Lenders shall have duly executed and
delivered to Administrative Agent this Amendment.

     3.2  DELIVERY OF CREDIT PARTY DOCUMENTS. On or before the date hereof,
Borrower shall deliver or cause to be delivered to Administrative Agent the
following with respect to each of Borrower and Holdings, each, unless otherwise
noted, dated the Fourth Amendment Effective Date:

          (a)  Certified copies of its Certificate of Formation, together with a
good standing certificate from the Secretary of State of the jurisdiction of its
incorporation and each other state in which it is qualified as a foreign
corporation to do business and where failure to be so qualified would have a
Material Adverse Effect and, to the extent generally available, a certificate or
other evidence of good standing as to payment of any applicable franchise or
similar taxes from the appropriate taxing authority of each of such states, each
dated a recent date prior to the Fourth Amendment Effective Date or, in the
event that any such document has been previously delivered by the Borrower to
the Administrative Agent, a certificate executed by a Responsible Officer of the
Borrower indicating that no change has occurred with respect to such document;

          (b)  Copies of its operating agreement or limited liability company
agreement, certified by its corporate secretary or an assistant secretary or a
certificate of the lack of any change thereto since the Initial Borrowing Date
or, in the event that any such document has been previously delivered by the
Borrower to the Administrative Agent, a certificate executed by a Responsible
Officer of the Borrower indicating that no change has occurred with respect to
such document;

          (c)  Resolutions of its members, manager or board of managers (i)
approving and authorizing the execution, delivery and performance of this
Amendment, and (ii) approving and authorizing the execution, delivery and
performance of the other Loan Documents to which it is a party and all
transactions related thereto, in each case certified as of the Fourth Amendment
Effective Date by its corporate secretary or an assistant secretary as being in
full force and effect without modification or amendments;

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          (d)  Signature and incumbency certificates of its officers executing
this Amendment; and

          (e)  Such other instruments and documents in respect of such matters
as Administrative Agent shall reasonably request.

     3.3 BORROWER'S SECURITY AND OTHER DOCUMENTS. The Borrower shall have duly
authorized, executed and delivered to the Collateral Agent the Collateral
Security Agreement Amendment in substantially the form of EXHIBIT B.

     3.4 REPRESENTATIONS AND WARRANTIES; DEFAULT; OFFICER'S CERTIFICATE. After
giving effect to this Amendment, the representations and warranties set forth in
ARTICLE VI of the Agreement shall be true and correct, except to the extent such
representations and warranties are expressly made as of a specified date in
which event such representations and warranties shall be true and correct as of
such specified date, and no Event of Default or Unmatured Event of Default shall
have occurred or be continuing and Administrative Agent shall have received a
certificate executed by a Responsible Officer on behalf of Borrower, dated the
Fourth Amendment Effective Date stating that, after giving effect to this
Amendment, the representations and warranties set forth in ARTICLE VI of the
Agreement are true and correct as of the date of the certificate, except to the
extent such representations and warranties are expressly made as of a specified
date in which event such representations and warranties shall be true and
correct as of such specified date, that no Event of Default or Unmatured Event
of Default has occurred and is continuing, and that the conditions of this
SECTION 3 hereof have been fully satisfied or waived.

     3.5 FEES. Borrower shall have paid to Administrative Agent and the Lenders
all costs, fees and expenses (including, without limitation, reasonable legal
fees and expenses) payable to Administrative Agent and the Lenders to the extent
then due, including, without limitation, pursuant to SECTION 5 of this
Amendment.

     3.6 CORPORATE PROCEEDINGS. All corporate and legal proceedings and all
instruments and agreements in connection with the execution and delivery of this
Amendment shall be satisfactory in form and substance to Administrative Agent
and the Required Lenders and Administrative Agent and all Lenders shall have
received all information and copies of all documents and papers, including
records of corporate proceedings, governmental approvals, good standing
certificates and bring-down telegrams or certificates, if any, which
Administrative Agent or such Lender reasonably may have requested in connection
therewith, such documents and papers where appropriate to be certified by proper
corporate or Governmental Authorities.

     Each Lender and the Administrative Agent hereby agrees that by its
execution and delivery of its signature page hereto, such Person approves of and
consents to each of the matters set forth in SECTION 3 which must be approved
by, or which must be satisfactory to, the Required Lenders or such Person, as
the case may be; PROVIDED that, in the case of any agreement or document which
must be approved by, or which must be satisfactory to, the Required Lenders,
Administrative Agent or Borrower shall have delivered a copy of such agreement
or document to such Person if so requested on or prior to the Fourth Amendment
Effective Date.

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     SECTION 4. REFERENCES TO AND EFFECT ON THE CREDIT AGREEMENT. On and after
the date hereof each reference in the Credit Agreement to "this Agreement,"
"hereunder," "hereof," "herein," or words of like import, and each reference to
the Credit Agreement, as the case may be, in the Loan Documents and all other
documents (the "Ancillary Documents") delivered in connection with the Credit
Agreement shall mean and be a reference to the Credit Agreement as amended
hereby.

     Except as specifically amended above, the Credit Agreement, and the other
Loan Documents and all other Ancillary Documents shall remain in full force and
effect and are hereby ratified and confirmed.

     The execution, delivery and effectiveness of this Amendment shall not,
except as expressly provided herein, operate as a waiver of any right, power or
remedy of the Lenders or Administrative Agent under the Credit Agreement, the
Loan Documents or the Ancillary Documents.

     SECTION 5. FEES, COSTS AND EXPENSES. (a) Borrower agrees to pay a fee to
the Administrative Agent on or prior to the Fourth Amendment Effective Date on
behalf of each Lender which has executed and delivered this Amendment on or
prior to 5:00 p.m. E.S.T. on March 15, 2002 equal to .125% times the sum of the
Domestic Revolving Commitment, Multicurrency Revolving Commitment and
outstanding Term Loans of such Lender as in effect under the Credit Agreement on
the Fourth Amendment Effective Date, such fee to be due and payable on the
Fourth Amendment Effective Date; and (b) Borrower also agrees to pay all
reasonable costs and expenses of the Administrative Agent in connection with the
negotiation, preparation, printing, typing, reproduction, execution and delivery
of this Amendment and all other documents furnished pursuant hereto or in
connection herewith, including without limitation, the reasonable fees and
out-of-pocket expenses of Winston & Strawn, special counsel to Administrative
Agent and any local counsel retained by Administrative Agent relative thereto or
the reasonable allocated costs of staff counsel as well as the fees and
out-of-pocket expenses of counsel, independent public accountants and other
outside experts retained by Administrative Agent in connection with the
administration of this Amendment.

                                       11
<Page>

     SECTION 6. MISCELLANEOUS.

     6.1  EXECUTION IN COUNTERPARTS. This Amendment may be executed in one or
more counterparts, each of which, when executed and delivered, shall be deemed
to be an original and all of which counterparts, taken together, shall
constitute but one and the same document with the same force and effect as if
the signatures of all of the parties were on a single counterpart, and it shall
not be necessary in making proof of this Amendment to produce more than one (1)
such counterpart. Delivery of an executed signature page to this Amendment by
telecopy shall be deemed to constitute delivery of an originally executed
signature page hereto.

     6.2  GOVERNING LAW. THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF SAID STATE WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.

     6.3  HEADINGS. Headings used in this Amendment are for convenience of
reference only and shall not affect the construction of this Amendment.

     6.4  INTEGRATION. This Amendment, the other agreements and documents
executed and delivered pursuant to this Amendment and the Credit Agreement
constitute the entire agreement among the parties hereto with respect to the
subject matter hereof.

     6.5  BINDING EFFECT. This Amendment shall be binding upon and inure to the
benefit of and be enforceable by the Borrower, the Administrative Agent and the
Lenders and their respective successors and assigns. Except as expressly set
forth to the contrary herein, this Agreement shall not be construed so as to
confer any right or benefit upon any Person other than the Borrower, the
Administrative Agent and the Lenders and their respective successors and
permitted assigns.

                            [SIGNATURE PAGE FOLLOWS]

                                       12
<Page>

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

                                       13
<Page>

                                    EXHIBIT A

                             SENIOR NOTES TERM SHEET

                                       14
<Page>

                                    EXHIBIT B

                 AMENDMENT NO.1 TO COLLATERAL SECURITY AGREEMENT

                                       15<Page>

                                                            Exhibit 4.3(f)(ii)

                       FIFTH AMENDMENT TO CREDIT AGREEMENT

     This Fifth Amendment to Credit Agreement (the "Amendment") is made as of
this 21st day of March, 2002 by and among AMERICAN MEDICAL SECURITY GROUP, INC.
("AMS"), the Lenders who are a party to the Credit Agreement from time to time
(the "Lenders") and LASALLE BANK NATIONAL ASSOCIATION, as Agent and Swing Line
Lender (the "Agent").

                               W I T N E S S E T H

     WHEREAS, AMS, the Agent and the Lenders, including First Union National
Bank, N.A. ("First Union") are parties to that certain Credit Agreement, dated
as of March 24, 2000, as amended pursuant to that certain First Amendment to
Credit Agreement, dated as of July 18, 2000, as further amended pursuant to that
certain Second Amendment to Credit Agreement, dated as of November 10, 2000, as
further amended pursuant to that certain Third Amendment to Credit Agreement,
dated as of January 29, 2001, and as further amended pursuant to that certain
Fourth Amendment to Credit Agreement, dated as of April 27, 2001 (collectively,
the "Credit Agreement");

     WHEREAS, immediately prior to the execution hereof and as a condition
precedent hereto, First Union and Bank of America, N.A. ("Bank of America") have
entered into that certain Assignment Agreement, pursuant to which First Union
has agreed to sell, assign and transfer to Bank of America, and Bank of America
has agreed to purchase, accept and assume from First Union, all of First Union's
percentage interest and outstanding rights and obligations under the Credit
Agreement, as more particularly set forth therein (the "Assignment Agreement");

     WHEREAS, as a result of the Assignment Agreement, Bank of America shall
have the rights and obligations of a Lender under the Loan Documents to the
extent of the rights and obligations assigned to Bank of America under the
Assignment Agreement, and First Union shall contemporaneously therewith
relinquish its rights and be released from its corresponding obligations as a
Lender under the Loan Documents and thereafter shall cease to be a Lender under
the Credit Agreement; and

     WHEREAS, the parties desire to amend the Credit Agreement, as more fully
set forth herein;

     NOW, THEREFORE, in consideration of the mutual agreements herein contained
and other good and valuable consideration, the adequacy of which is hereby
acknowledged, and subject to the terms and conditions hereof, the parties hereto
agree as follows:

SECTION 1. DEFINITIONS. Unless otherwise defined herein, all capitalized terms
shall have the meaning given to them in the Credit Agreement.

SECTION 2. AMENDMENTS TO CREDIT AGREEMENT.

     2.1  Article I of the Credit Agreement is hereby amended by inserting the
following definitions in their appropriate alphabetical order:

          ""Debtor Relief Laws" means the Bankruptcy Code of the United States
     of America, and all other liquidation, conservatorship, bankruptcy,
     assignment for the benefit of creditors,

<Page>

     moratorium, rearrangement, receivership, insolvency, reorganization, or
     similar debtor relief laws of the United States of America (including any
     Federal, state or local equivalents) or other applicable jurisdictions from
     time to time in effect and affecting the rights of creditors generally."

          ""Purchase Agreement" means that certain Stock Purchase Agreement
     dated as of March 19, 2002 among Seller, Cobalt Corporation and AMS."

          ""Repurchase" means that certain repurchase by AMS of approximately
     one million four hundred thousand (1,400,000) shares of its capital stock
     from Blue Cross & Blue Shield United of Wisconsin, a Wholly-Owned
     Subsidiary of Cobalt Corporation, for an aggregate purchase price not in
     excess of $18,200,000, after receipt of all necessary and required consents
     and approvals."

          ""Seller Group" means collectively, Blue Cross & Blue Shield United of
     Wisconsin and Cobalt Corporation."

          ""Special Dividend" means that certain special dividend of up to
     $20,000,000 which Holdings shall cause UWLIC to declare and pay directly to
     AMS, after receipt of all necessary and required consents and approvals,
     including, without limitation, the consent of the Wisconsin Department of
     Insurance, which funds shall be applied by AMS to effect the Repurchase and
     cover any costs related thereto."

     2.2  Article I of the Credit Agreement is hereby amended by deleting the
definition of "Applicable Margin" in its entirety and inserting the following in
its stead:

          ""Applicable Margin" means, with respect to Eurodollar Advances at any
     time, 3.00% per annum (unless a Default or an Unmatured Default has
     occurred that is continuing)."

     2.3  Article I of the Credit Agreement is hereby amended by deleting the
definition "Change in Control" in its entirety and inserting the following in
its stead:

          ""Change in Control" means (a) the acquisition by any Person, or
          two or more Persons acting in concert, of beneficial ownership
          (within the meaning of Rule 13d-3 of the Securities and Exchange
          Commission under the Securities Exchange Act of 1934) or voting
          control, directly or indirectly, of 25% or more of the outstanding
          shares of voting stock of AMS; (b) AMS shall cease to own, free and
          clear of all Liens other than Permitted Liens, 100% of the
          outstanding shares of voting stock of Holdings on a fully diluted
          basis (other than pursuant to a merger of Holdings with and into
          AMS in accordance with SECTION 6.12; (c) Holdings shall cease to
          own, free and clear of all Liens other than Permitted Liens, 100%
          of the outstanding shares of voting stock of UWLIC on a fully
          diluted basis; or (d) during any period of 25 consecutive calendar
          months, commencing on the date of this Agreement, the ceasing of
          those individuals (the "Continuing Directors") who (i) were
          directors of AMS on the first day of each such period or (ii)
          subsequently became directors of AMS and whose initial election or
          initial nomination for election subsequent to that date was
          approved by a majority of the

                                       2
<Page>

          Continuing Directors then on the board of directors of AMS to
          constitute a majority of the board of directors of AMS."

     2.4  Article I of the Credit Agreement is hereby amended by deleting the
definition of "Non-Use Fee Rate" in its entirety and inserting the following in
its stead:

          ""Non-Use Fee Rate" means, at any time, 0.50% per annum on the unused
     amount of the Aggregate Commitment."

     2.5  Section 2.8(a) of the Credit Agreement is hereby deleted in its
entirety and amended by inserting the following in its stead:

          "2.8. MANDATORY COMMITMENT REDUCTIONS. (a) The Aggregate Commitment
     shall be automatically and permanently reduced to the following amounts on
     the following dates:

<Table>
<Caption>
               DATE           AVAILABILITY REDUCTION   AGGREGATE COMMITMENT
          --------------      ----------------------   --------------------
<S>                           <C>                      <C>
          March 24, 2003      $10,000,000              $20,157,772
          March 24, 2004      $10,000,000              $10,157,772
          March 24, 2005      $10,157,772              $0"
</Table>

     2.6  Section 2.11 of the Credit Agreement is hereby amended by deleting the
reference to "$10,000,000" and inserting "$5,000,000" in its stead.

     2.7  Section 2.14 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

          "2.14. RATES APPLICABLE AFTER DEFAULT. Notwithstanding anything to the
     contrary contained in SECTION 2.9 or 2.10, during the continuance of a
     Default or Unmatured Default the Required Lenders may, at their option, by
     notice to AMS (which notice may be revoked at the option of the Required
     Lenders notwithstanding any provision of SECTION 8.2 requiring unanimous
     consent of the Lenders to changes in interest rates), declare that no
     Advance may be made as, converted into or continued as a Eurodollar
     Advance. During the continuance of a Default the Required Lenders may, at
     their option, by notice to AMS (which notice may be revoked at the option
     of the Required Lenders notwithstanding any provision of SECTION 8.2
     requiring unanimous consent of the Lenders to changes in interest rates),
     declare that each Loan shall bear interest at the higher of the Eurodollar
     Rate or the Floating Rate then in effect, plus the applicable margin then
     in effect from time to time, plus 2.00% per annum; PROVIDED, that during
     the continuance of a Default under SECTION 7.6 or 7.7, the interest rate
     set forth above shall be applicable to all Loans without any election or
     action on the part of the Agent or any Lender."

     2.8  Section 3.1 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

          "3.1. YIELD PROTECTION. If, on or after the Initial Closing Date, any
     Lender determines that the adoption of or change in any law or any
     governmental or quasi-governmental rule, regulation, policy, guideline or
     directive (whether or not having the force of law), or any change in the
     interpretation or administration thereof by any governmental or
     quasi-governmental

                                       3
<Page>

     authority, central bank or comparable agency charged with the
     interpretation or administration thereof, or compliance by any Lender or
     applicable Lending Installation with any request or directive (whether or
     not having the force of law) of any such authority, central bank or
     comparable agency:

               (a)  subjects any Lender or any applicable Lending Installation
                    to any Taxes, or changes the basis of taxation of payments
                    (other than with respect to Excluded Taxes) to any Lender in
                    respect of its Eurodollar Loans, or

               (b)  imposes or increases or deems applicable any reserve,
                    assessment, insurance charge, special deposit or similar
                    requirement against assets of, deposits with or for the
                    account of, or credit extended by, any Lender or any
                    applicable Lending Installation (other than reserves and
                    assessments taken into account in determining the interest
                    rate applicable to Eurodollar Advances), or

               (c)  imposes any other condition the result of which is to
                    increase the cost to any Lender or any applicable Lending
                    Installation of agreeing to make or making, funding or
                    maintaining its Eurodollar Loans or reduces any amount
                    receivable by any Lender or any applicable Lending
                    Installation in connection with its Eurodollar Loans, or
                    requires any Lender or any applicable Lending Installation
                    to make any payment calculated by reference to the amount of
                    Eurodollar Loans held or interest received by it, by an
                    amount deemed material by such Lender,

     and the result of any of the foregoing is to increase the cost to such
     Lender or applicable Lending Installation of making, funding or maintaining
     its Eurodollar Loans or Commitment or to reduce the return received by such
     Lender or applicable Lending Installation in connection with such
     Eurodollar Loans or Commitment, then, within 15 days of demand by such
     Lender, AMS shall pay such Lender such additional amount or amounts as will
     compensate such Lender for such increased cost or reduction in amount
     received."

     2.9  Section 3.2 of the Credit Agreement is hereby amended by deleting the
second sentence thereof and inserting the following in its stead:

          ""CHANGE" means (a) any change after the Initial Closing Date in or
     change in the interpretation of the Risk-Based Capital Guidelines or (b)
     any adoption of or change in or change in the interpretation of any other
     law, governmental or quasi-governmental rule, regulation, policy,
     guideline, interpretation, or directive (whether or not having the force of
     law) after the date of this Agreement which affects the amount of capital
     required or expected to be maintained by any Lender or any Lending
     Installation or any corporation controlling any Lender."

     2.10 Section 3.5 of the Credit Agreement is hereby amended by deleting
subsection (c) thereof and inserting the following in its stead:

                                       4
<Page>

          "(c) AMS hereby agrees to indemnify the Agent and each Lender for the
     full amount of Taxes or Other Taxes (including, without limitation, any
     Taxes or Other Taxes imposed on amounts payable under this SECTION 3.5)
     paid by the Agent or such Lender and any liability (including penalties,
     interest and expenses) arising therefrom or with respect thereto, in each
     case whether or not such Taxes or Other Taxes were correctly or legally
     imposed or asserted by the relevant Governmental Authority. Payments due
     under this indemnification shall be made within 30 days of the date the
     Agent or such Lender makes demand therefor pursuant to SECTION 3.6."

     2.11 Section 4.2 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

          "4.2. EACH ADVANCE AND SWING LINE LOAN. The Lenders shall not be
     required to make any Advance (other than an Advance that, after giving
     effect thereto and to the application of the proceeds thereof, does not
     increase the aggregate amount of outstanding Advances) and the Swing Line
     Lender shall not be required to make any Swing Line Loan, unless on the
     applicable Borrowing Date:

               (a)  There exists no Default or Unmatured Default.

               (b)  The representations and warranties contained in the Loan
                    Documents are true and correct as of such Borrowing Date
                    except to the extent any such representation or warranty is
                    stated to relate solely to an earlier date, in which case
                    such representation or warranty shall have been true and
                    correct on and as of such earlier date.

               (c)  All legal matters incident to the making of such Advance or
                    Swing Line Loan shall be satisfactory to the Lenders and
                    their counsel.

          Each Borrowing Notice and/or Conversion/Continuation Notice with
     respect to each such Advance and each request for a Swing Line Loan shall
     constitute a representation and warranty by AMS that the conditions
     contained in SECTION 4.2(a) and (b) have been satisfied. Any Lender may
     require a duly completed compliance certificate in substantially the form
     of EXHIBIT A as a condition to making an Advance."

     2.12 Section 6.10 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

          "6.10 DIVIDENDS. AMS will not, nor will it permit any Subsidiary to,
     declare or pay any dividends or make any distributions on its capital stock
     (other than dividends payable in its own capital stock) or redeem,
     repurchase or otherwise acquire or retire any of its capital stock at any
     time outstanding, except that (i) any Subsidiary may declare and pay
     dividends to a Wholly-Owned Subsidiary or to AMS, and (ii) AMS may
     repurchase its outstanding stock, provided that any such repurchases shall
     not exceed $28,400,000 in the aggregate; and provided further, that such
     $28,400,000 includes up to $18,200,000 that shall be used solely to
     consummate the Repurchase."

                                       5
<Page>

     2.13 Section 6.19.5 of the Credit Agreement is hereby deleted in its
entirety and amended by inserting the following in its stead:

          "6.19.5 STATUTORY CAPITAL AND SURPLUS. AMS will at all times cause
     UWLIC to maintain a Statutory Capital and Surplus of not less than the sum
     of (a) $128,000,000, plus (b) 50% of the positive Statutory Net Income
     earned by UWLIC in each Fiscal Quarter ending after December 31, 2001 and
     on or prior to the date of determination (excluding changes in unrealized
     gain/loss)."

     2.14 Article VI of the Credit Agreement is amended by inserting new
Sections 6.29 and 6.30 after Section 6.28 as follows:

          "6.29 REPURCHASE. Prior to effecting the Repurchase, AMS shall obtain,
     or cause to be obtained, all necessary and required consents, approvals,
     resolutions and documentation in connection with the Repurchase (including,
     without limitation, the consent of the Wisconsin Department of Insurance to
     the Special Dividend), and, AMS shall provide evidence of such consents and
     approvals to the Agent, together with copies of all required resolutions
     and documents with respect thereto, all of which shall be reasonably
     acceptable to the Agent and its counsel. Immediately upon receipt of such
     necessary and required consents, approvals, resolutions and documentation,
     AMS shall cause the Special Dividend to be declared and paid, and,
     immediately upon receipt of the proceeds of the Special Dividend, AMS shall
     apply such proceeds to effect the Repurchase and any costs related thereto.

          "6.30 PURCHASE AGREEMENT REMEDIES. In the event of any breach of the
     representations and warranties of the Seller Group contained in the
     Purchase Agreement with respect to the shares of stock of AMS which are the
     subject of the Repurchase, which breach could reasonably be expected to
     give rise to a Material Adverse Effect, AMS covenants and agrees to
     diligently pursue all of the rights and remedies available to it under the
     Purchase Agreement or otherwise with respect to such breach."

     2.15 Section 7.3 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

          "7.3. The breach by AMS of any of the terms or provisions of SECTION
     6.1, SECTION 6.2, SECTION 6.4 or SECTIONS 6.10 through 6.27."

     2.16 Section 7.4 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

          "7.4. The breach by AMS (other than a breach which constitutes a
     Default under another Section of this ARTICLE VII) of any of the terms or
     provisions of any Loan Document which is not remedied within twenty (20)
     days after the earlier of (i) the receipt by AMS of notice thereof from
     Agent or any Lender or (ii) having obtained knowledge thereof."

     2.17 Section 7.5 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

                                       6
<Page>

          "7.5. Failure of AMS or any of its Subsidiaries to make any payment
     when due (whether by scheduled maturity, required prepayment, acceleration,
     demand or otherwise) in respect of any Indebtedness aggregating in excess
     of $1,500,000 ("MATERIAL INDEBTEDNESS"); or the default by AMS or any of
     its Subsidiaries in the performance (beyond the applicable grace period
     with respect thereto, if any) of any term, provision or condition contained
     in any agreement under which any such Material Indebtedness was created or
     is governed, or any other event shall occur or condition exist, the effect
     of which default or event is to cause, or to permit the holder or holders
     of such Material Indebtedness to cause, such Material Indebtedness to
     become due prior to its stated maturity; or any Material Indebtedness of
     AMS or any of its Subsidiaries shall be declared to be due and payable or
     required to be prepaid or repurchased (other than by a regularly scheduled
     payment) prior to the stated maturity thereof; or AMS or any of its
     Subsidiaries becomes unable, or admits in writing its inability or fails
     generally to pay its debts as they become due."

     2.18 Section 7.6 of the Credit Agreement is hereby deleted in its entirety
and amended by inserting the following in its stead:

          "7.6. AMS or any of its Subsidiaries shall (a) have an order for
     relief entered with respect to it under any Debtor Relief Laws as now or
     hereafter in effect, (b) make an assignment for the benefit of creditors,
     (c) apply for, seek, consent to, or acquiesce in, the appointment of a
     receiver, custodian, trustee, examiner, liquidator or similar official for
     it or any Substantial Portion of its Property, (d) institute (or consent to
     the institution of) any proceeding seeking an order for relief under any
     Debtor Relief Laws as now or hereafter in effect or seeking to adjudicate
     it a bankrupt or insolvent, or seeking dissolution, winding up,
     liquidation, reorganization, arrangement, adjustment or composition of it
     or its debts under any law relating to bankruptcy, insolvency or
     reorganization or relief of debtors or fail to file an answer or other
     pleading denying the material allegations of any such proceeding filed
     against it, (e) take any corporate or partnership action to authorize or
     effect any of the foregoing actions set forth in this SECTION 7.6 or (f)
     fail to contest in good faith any appointment or proceeding described in
     SECTION 7.7."

     2.19 Section 12.2.1 of the Credit Agreement is hereby amended by deleting
the first sentence thereof and inserting the following in its stead:

          "Any Lender may, in the ordinary course of its business and in
     accordance with applicable law, at any time sell to one or more banks or
     other entities ("PARTICIPANTS") participating interests in any Loan owing
     to such Lender, any Note held by such Lender, any Commitment of such Lender
     or any other interest, right and/or obligation of such Lender under the
     Loan Documents."

SECTION 3. WAIVER OF CERTAIN COVENANT DEFAULTS. The Agent, on behalf of itself
and the Lenders, waives any Default which may occur due solely to a breach by
AMS of Section 6.16 of the Credit Agreement solely in connection with the
Repurchase; PROVIDED, HOWEVER, that such waiver shall not constitute a future
waiver of any Default under such Section or of any other provision of the Credit
Agreement which, in any case, is not in connection with the Repurchase.

                                       7
<Page>

SECTION 4. RELEASE OF COLLATERAL ASSIGNMENT. Contemporaneously with the
effectiveness of this Amendment, the Agent, at the direction and with the
consent of the Lenders hereby terminates that certain Collateral Assignment and
Security Agreement dated as of November 10, 2000 (the "Assignment") made by AMS
in favor of the Agent for the benefit of the Lenders, with respect to Account
No. 03-8644902 and all funds contained therein.

SECTION 5. CONDITIONS PRECEDENT. The effectiveness of this Amendment is
expressly conditioned upon satisfaction of the following conditions precedent:

     5.1  The Agent shall have received copies of this Amendment duly executed
and delivered by AMS and each of the Lenders.

     5.2  The Agent shall have received a duly executed copy of the Stock
Purchase Agreement dated as of March 19, 2002, by and among Blue Cross & Blue
Shield United of Wisconsin, Cobalt Corporation and AMS, executed and delivered
in connection with the Repurchase, together with any and all agreements,
instruments and other documents executed and/or delivered in connection
therewith.

     5.3  The Agent shall have received, for the benefit of the Agent and the
Lenders, an amendment fee of $226,183 due and payable and deemed fully earned on
the date hereof.

     5.4  The Agent shall have received a $3,500 processing assignment fee due
and payable by AMS to the Agent pursuant to Section 12.3.2 of the Credit
Agreement.

     5.5  The Agent and the Lenders shall have received copies of the Assignment
Agreement duly executed by Bank of America, N.A. and First Union, including
evidence that, contemporaneously with the execution of the Assignment Agreement,
(i) First Union shall have returned the Revolving Note in favor of First Union
to AMS and (ii) Bank of America, N.A. shall have received a Revolving Note in
favor of Bank of America, N.A. duly executed by AMS.

     5.6  The Agent and the Lenders shall have received such other documents,
certificates and assurances as they shall reasonably request.

SECTION 6. REAFFIRMATION OF AMS. AMS hereby represents and warrants to the Agent
and the Lenders that (i) the representations and warranties set forth in the
Loan Documents are true and correct on and as of the date hereof, except to the
extent (a) that any such representations and warranties relate to a specific
date, or (b) changes thereto are a result of transactions for which the Agent
and the Lenders have granted their consent; (ii) each of Holdings and AMS is on
the date hereof in compliance with all of the terms and provisions set forth in
the Loan Documents to which it is a party, in each case (and to the extent
applicable), as hereby amended; and (iii) both before and after giving effect to
this Amendment, there exists no Default or Unmatured Default.

SECTION 7. FULL FORCE AND EFFECT. Except as herein amended, the Credit Agreement
and all other Loan Documents shall remain in full force and effect.

                                       8
<Page>

SECTION 8. COUNTERPARTS. This Amendment may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same document.

SECTION 9. GOVERNING LAW. This Amendment shall be construed in accordance with
the internal laws (and not the law of conflicts) of the State of Illinois, but
giving effect to federal laws applicable to national banks.

                            [SIGNATURE PAGE FOLLOWS]

                                       9
<Page>

     IN WITNESS WHEREOF, the parties hereto have executed this Amendment on
the day and year specified above.

                                   AMERICAN MEDICAL SECURITY GROUP,
                                   INC.

                                   By:  /s/ Gary Guengerich
                                      ------------------------------------------
                                   Name: Gary Guengerich
                                   Title: Chief Financial Officer

                                   LASALLE BANK NATIONAL ASSOCIATION

                                   By:    /s/ Linda Whittaker
                                      ------------------------------------------
                                   Name: Linda Whittaker
                                   Title: Assistant Vice President

                                   BANK OF AMERICA, N.A.

                                   By:    /s/ Joseph Corah
                                      ------------------------------------------
                                   Name: Joseph Corah
                                   Title: Principal

                                   ASSOCIATED BANK GREEN BAY, NATIONAL
                                   ASSOCIATION

                                   By:    /s/ Denis F. Hogan
                                      ------------------------------------------
                                   Name: Denis F. Hogan
                                   Title: Senior Vice President

                                       10
<Page>

                    ACKNOWLEDGMENT AND AGREEMENT OF HOLDINGS

     The undersigned, AMERICAN MEDICAL SECURITY HOLDINGS, INC., hereby ratifies
and reaffirms (a) that certain Guaranty dated March 24, 2000 (the "Guaranty")
made by the undersigned in favor of the Agent and the Lenders and (b) that
certain Stock Pledge Agreement dated March 24, 2000 (the "Pledge Agreement")
between the undersigned and the Agent and each of the terms and provisions
(including, without limitation, the representations and warranties) contained
therein, and agrees that each of the Guaranty and the Pledge Agreement continues
in full force and effect following the execution and delivery of the foregoing
Amendment. The undersigned represents and warrants to the Agent and the Lenders
that each of the Guaranty and the Pledge Agreement was, on the date of the
execution and delivery thereof, and continues to be, the valid and binding
obligation of the undersigned enforceable in accordance with its terms and that
the undersigned has no claims or defenses to the enforcement of the rights and
remedies of the Agent and the Lenders under the Guaranty or the Pledge
Agreement, and further that it is in compliance with all of the terms and
provisions set forth in each of the Loan Documents to which it is a party.

     IN WITNESS WHEREOF, this Acknowledgment and Agreement of Holdings
has been duly authorized as of this 21st day of March, 2002.

                                   AMERICAN MEDICAL SECURITY HOLDINGS,
                                   INC.

                                   By:   /s/ Gary Guengerich
                                      ------------------------------------------
                                   Name: Gary Guengerich
                                   Title: Chief Financial Officer

                                      11

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