Document:

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                                                                    EXHIBIT 10.5

                                FEDERAL EMPLOYEES
                             HEALTH BENEFITS PROGRAM

                                STANDARD CONTRACT
                                    AMENDMENT

                                       FOR

                                EXPERIENCE-RATED
                    HEALTH MAINTENANCE ORGANIZATION CARRIERS

                                      2002
                                                                       (ER-2002)

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                 CONTRACT FOR FEDERAL EMPLOYEES HEALTH BENEFITS

CONTRACT NO:    CS 1090                                     AMENDMENT NO: 2002-A
EFFECTIVE:      January 1, 1960                       EFFECTIVE: January 1, 2002

BETWEEN:        THE UNITED STATES OFFICE OF PERSONNEL MANAGEMENT
                hereinafter called the OPM, the Agency, or the Government

AND

CONTRACTOR:     TRIPLE-S
                  hereinafter also called the Carrier

Address:        1441 Roosevelt Avenue
                San Juan, Puerto Rico 00936-3628

In consideration of payment by the Agency of subscription charges set forth in
Appendix B, the Carrier agrees to perform all of the services set forth in this
contract, including Appendix A.

 FOR THE CARRIER                            FOR THE GOVERNMENT

     MIGUEL A. VAZQUEZ DEYNES               DANIEL A. GREEN
------------------------------------       ------------------------------------
 Name of Person Authorized to               Name of Contracting Officer
 Execute Contract (Type or print)

 PRESIDENT & CEO                            CHIEF, INSURANCE CONTRACTS DIV. II
------------------------------------       ------------------------------------
 Title of Signer                            Title of Signer

/s/  MIGUEL A. VAZQUEZ DEYNES
------------------------------------       ------------------------------------
 Signature of Person                        Signature
 Authorized to Execute Contract

      12-06-01
------------------------------------       ------------------------------------
 Date Signed                                Date Signed

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                  YEAR 2002 AMENDMENTS TO THE STANDARD CONTRACT
                            FOR EXPERIENCE-RATED HMOS

1.       Redate Section 1.4 INCORPORATION OF LAWS AND REGULATIONS as JAN 2002
         and revise paragraph (b), as follows:

SECTION 1.4

INCORPORATION OF LAWS AND REGULATIONS (JAN 2002)

         (a)      The applicable provisions of (1) chapter 89 of title 5, United
States Code; (2) OPM's regulations as contained in part 890, title 5, Code of
Federal Regulations; and (3) chapters 1 and 16 of title 48, Code of Federal
Regulations constitute a part of this contract as if fully set forth herein, and
the other provisions of this contract shall be construed so as to comply
therewith.

         (b)      If the Regulations are changed in a manner which would
increase the Carrier's liability under this contract, the Contracting Officer
will make an equitable adjustment in accordance with the changes clause, Section
5.38 -- Changes--Negotiated Benefits Contracts.

2.       Redate Section 1.9 FEHB QUALITY ASSURANCE as JAN 2002 and revise
         paragraph (a), as follows:

SECTION 1.9
FEHB QUALITY ASSURANCE (JAN 2002)

         (a)      Health Care Quality.

         (1)      Effectiveness of Care Measures. The Carrier shall measure
and/or collect data on the quality of the health care services it renders to its
members as requested by OPM. Measurement/data collection efforts may include
performance measurement systems such as Health Plan Employer Data and
Information Set (IEDIS) or ORYX(TM), or similar measures developed by
accreditation agencies such as the National Committee for Quality Assurance
(NCQA), the Joint Commission on Accreditation of Healthcare Organizations
(JCAHO), or the American Accreditation Healthcare Commission/URAC. Costs
incurred by the Carrier for collecting or contracting with a vendor to collect
quality measures/data shall be the Carrier's responsibility and are allowable
administrative expenses, subject to the administrative cost limitation.

         (2)      Reducing Medical Errors. The Carrier shall implement a patient
safety improvement program. At a minimum, the Carrier shall --

                  (i)      Report to OPM on its current patient safety
initiatives;

                  (ii)     Report to OPM on how it will strengthen its patient
safety program for the future;

                  (iii)    Assist OPM in providing its members with consumer
information and education regarding patient safety; and

                  (iv)     Work with its providers, independent accreditation
agencies, and others to implement patient safety improvement programs.

         (3)      Physician Credentialing. The Carrier is encouraged to use an
independent accrediting organization to validate its physician credentialing. If
the Carrier's physicians meet the credentialing requirements of the
credentialing organization, it has met and exceeds the minimum requirements
listed below. Otherwise, the Carrier must demonstrate that it requires the
following credential checks of all of its physicians, both during the initial
hiring process and during periodic re-credentialing. As an alternative, the
Carrier may demonstrate that the following credential checks are performed by a
secondary source, such as a hospital.

-        Verification of medical school graduation records.

-        Routine check with local and/or state medical societies and/or boards.

                                       3
                                                                       (ER-2002)

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-        Routine check of the Department of Health and Human Services (DHHS)
         list of debarred providers.

-        Routine check of the National Practitioner Data Bank.

         (4)      To demonstrate its commitment to providing quality,
cost-effective health care, if it has 500 or more Federal enrollees, the Carrier
shall provide its business plan with the steps and timeframes planned to achieve
and maintain accreditation.

         (5)      In order to allow sufficient implementation time, the
Contracting Officer will notify the Carrier reasonably in advance of any new
requirement(s) under paragraphs (a)(1) and (a)(2).

         (b)      Access and Measures of Service.

         (1)      In addition to any other means of surveying Plan members that
the Carrier may develop, the Carrier shall participate in the HEDIS Consumer
Assessments of Health Plans Surveys (CAHPS) to provide feedback to enrollees on
enrollee experience with the various FEHBP plans. The Carrier shall take into
account the published results of the survey, or other results as directed by
OPM, in identifying areas for improvement as part of the Carrier's quality
assurance program. Payment of survey charges will be in accordance with Section
3.11.

         (2)      The Carrier shall develop and apply a quality assurance
program specifying procedures for assuring contract quality. At a minimum the
program shall include procedures to address:

         (i)      Accuracy of Payments:

         (A)      Processing Accuracy - the number of FEHB claims processed
accurately divided by the total number of FEHB claims processed for the given
time period, expressed as a percentage.

         REQUIRED STANDARD: An average of 95 percent of FEHB claims must be
processed accurately.

         (B)      COB Processing - the Carrier must demonstrate that a
statistically valid sampling technique is routinely used to identify FEHB
claims prior to or after processing that require(d) coordination of benefits
(COB) with a third party payer. As an alternative, the Carrier may provide
evidence that it pursues all claims for COB.

         (ii)     Timeliness of Payments to Members or Providers:

         (A)      Average Processing Time (All FEHB Claims) - the average number
of working days from the date the Carrier receives an FEHB claim to the date it
adjudicates it (paid, denied or a request for further information is sent out),
for the given time period, expressed as a cumulative percentage.

         REQUIRED STANDARD:

         -        The Carrier adjudicates an average of 60 percent of FEHB
                  claims received over the given time period within 20 working
                  days (28 calendar days).

         -        The Carrier adjudicates an average of 80 percent of FEHB
                  claims received over the given time period within 30 working
                  days (42 calendar days).

         -        The Carrier adjudicates an average of 95 percent of FEHB
                  claims received over the given time period within 60 working
                  days (84 calendar days).

         (iii)    Quality of Service and Responsiveness to Members:

         (A)      Processing ID cards on change of plan or option - the number
of calendar days from the date the Carrier receives the enrollment from the
enrollee's agency or retirement system to the date it issues the ID card.

         REQUIRED STANDARD:

         The Carrier issues the ID card within fifteen calendar days after
receiving the enrollment from the enrollee's agency or retirement system.

         (B)      Member Inquiries - the number of working days taken to respond
to an FEHB member's written inquiry, expressed as a cumulative percentage, for
the given time period.

                                       4
                                                                       (ER-2002)

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         REQUIRED STANDARD:

         -        The Carrier responds to an average of 60 percent of FEHB
                  member written inquiries within 10 working days (14 calendar
                  days).

         -        The Carrier responds to an average of 90 percent of FEHB
                  member written inquiries within 30 working days (42 calendar
                  days).

         (C)      Telephone Access - the Carrier shall report on the following
statistics concerning telephone access to the member services department (or its
equivalent) for the given time period. Except that, if the Carrier does not have
a computerized phone system, report results of periodic surveys on telephone
access.

         (a)      Telephone Waiting Time - the average number of seconds
elapsing before the Carrier connects a member's telephone call to its service
representative.

         REQUIRED STANDARD: On average, no more than 1.5 minutes elapse before
the Carrier connects a member's telephone call to its service representative.

         (b)      Telephone Blockage Rate - the percentage of time that callers
receive a busy signal when calling the Carrier.

         REQUIRED STANDARD: On average, callers receive a busy signal no more
than 10 percent of the time.

         (c)      Telephone Abandonment Rate - the number of calls attempted but
not completed (presumably because callers tired of waiting to be connected to a
Carrier representative) divided by the total number of calls attempted (both
completed and not completed), expressed as a percentage.

         REQUIRED STANDARD: On average, enrollees abandon the effort no more
than 8 percent of the time.

         (iv)     Responsiveness to FEHB Member Requests for Reconsideration:

         REQUIRED STANDARD: For 100 percent of written FEHB disputed claim
requests received for the given time period, within 30 days after receipt by the
Carrier, the Carrier shall affirm the denial in writing to the FEHB member, pay
the claim, provide the service, or request additional information reasonably
necessary to make a determination.

         (v)      Quality Assurance Plan:

         The Carrier must demonstrate that a statistically valid sampling
technique is routinely used prior to or after processing to randomly sample FEHB
claims against Carrier quality assurance/fraud and abuse prevention standards.

         (c)      Appointments.

         All Health Maintenance Organization carriers must meet the following
standards for the given time period. Except that, if this information is not
routinely collected, report results from periodic surveys.

         REQUIRED STANDARD:

         (1)      Urgent appointments are available, on average, within 24 hours
of an authorized request for one.

         (2)      Routine appointments are available, on average, within 1 month
of an authorized request for one.

         (3)      Average office waiting times - on average, members who arrive
on time for a scheduled appointment wait no more than 30 minutes before they are
seen by the provider of the medical service.

         (NOTE: For the purpose of this standard (c), a simplified
         classification system is used in which all appointments are classified
         as either emergency, urgent or routine. Emergency appointments must be
         seen immediately to prevent health deterioration. Urgent appointments
         are those for the sudden, acute onset of symptoms that must be seen
         within 1 (one) day to prevent health deterioration. All other
         appointments are considered routine.)

         (d) Detection of Fraud and Abuse.

         The Carrier shall conduct a program to assess its vulnerability to
fraud and abuse and shall operate a system designed to detect and eliminate
fraud and abuse internally by Carrier employees and subcontractors, by providers
providing goods or services to FEHB Members, and by individual FEHB Members.

                                       5
                                                                       (ER-2002)

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         (e)      Reporting Compliance.

         The Carrier shall keep complete records of its quality assurance
procedures and fraud program and the results of their implementation and make
them available to the Government as determined by OPM. If the Carrier cannot
separate FEHB claims from all other claims, the Carrier may report compliance
based on all claims and indicate this on the report.

         (f)      Correction of deficiencies.

         The Contracting Officer may order the correction of a deficiency in the
Carrier's quality assurance program or fraud program. The Carrier shall take the
necessary action promptly to implement the Contracting Officer's order. If the
Contracting Officer orders a modification of the Carrier's quality assurance
program or fraud program pursuant to this paragraph (f) after the contract year
has begun, the costs incurred to correct the deficiency may be excluded from the
administrative expenses -- for the contract year -- that are subject to the
administrative expenses limitation specified at Appendix B; provided the Carrier
demonstrates that the correction of the deficiency significantly increases the
Carrier's liability under this contract.

3.       Redate Section 1.13 INFORMATION AND MARKETING MATERIALS as JAN 2002 and
         revise paragraph (a), as follows:

SECTION 1.13

INFORMATION AND MARKETING MATERIALS (JAN 2002)

         (a)      OPM and the Carrier shall agree upon language setting forth
the benefits, exclusions and other language of the Plan. The Carrier bears full
responsibility for the accuracy of its FEHB brochure. OPM, in its sole
discretion, may order the Carrier to print and distribute the agreed upon
brochure text, in a format and quantity approved by OPM, including an electronic
brochure version for OPM's web site. This formatted document is referred to as
the FEHB brochure. The Carrier shall distribute the FEHB brochure on a timely
basis TO ALL Federal employees, annuitants, former spouses and former employees
and dependents enrolled in the Plan. The Carrier shall also distribute the
document(s) to Federal agencies to be made available to such individuals who are
eligible to enroll under this contract. At the direction of OPM, the Carrier
shall produce and distribute an audio cassette version of the approved language.
The Carrier may print additional FEHB brochures for distribution or its own use,
but only in the approved format and at its own expense.

         (b)      Supplemental material. Only marketing materials or other
supplemental literature prepared in accordance with FEHBAR 1652.203-70 (Section
1.14 of this contract) may be distributed or displayed at or through Federal
facilities.

         (c)      The Carrier shall reflect the statement of benefits in the
agreed upon brochure text included at Appendix A of this contract, verbatim, in
the FEHB brochure.

         (d)      OPM may order the Carrier to prepare an addendum or reissue
the FEHB brochure or any piece(s) of supplemental marketing material at no
expense to the Government if it is found to not conform to the agreed upon
brochure text and/or supplemental marketing materials preparations described in
paragraphs (a), (b) and (c) of this section.

4.       Replace the "RESERVED" Section 1.21 with Section 1.21 ADMINISTRATIVE
         SIMPLIFICATION - HIPAA (JAN 2002), as follows:

SECTION 1.21

ADMINISTRATIVE SIMPLIFICATION - HIPAA (JAN 2002)

         (a)      The Carrier shall implement and be in compliance with the
standards for electronic transactions in accordance with the regulations

                                       6
                                                                       (ER-2002)

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issued and on the date set forth by the Department of Health and Human Services.

         (b)      The Carrier shall implement and be in compliance with the
standards for privacy of individually identifiable health information in
accordance with the regulations issued and on the date set forth by the
Department of Health and Human Services.

5.       Redate Section 1.23 NOTICE TO ENROLLEES ON TERMINATION OF FEHBP OR
         PROVIDER CONTRACT as JAN 2002 and revise paragraph (b), as follows:

SECTION 1.23

NOTICE TO ENROLLEES ON TERMINATION OF FEHBP OR PROVIDER CONTRACT
(JAN 2002)

         (a)      Enrollees who are undergoing treatment for a chronic or
disabling condition or who are in the second or third trimester of pregnancy at
the time a carrier terminates (1) all of part of its FEHBP contract or (2) the
enrollees' specialty provider contract for reasons other than cause, may be able
to continue to see their specialty provider for up to 90 days or through their
postpartum care.

         (b)      The Carrier shall notify its enrollees in writing of its
intent to terminate all or part of its FEHBP contract, including service area
reductions, or the enrollees' specialty provider contract, for reasons other
than cause, in order to allow sufficient time for the enrollees to arrange for
continued care after the 90-day period or their postpartum care, whichever
applies. The Carrier shall send the notice in time to ensure it is received by
the enrollees no less than 90 days prior to the date it terminates the contract,
unless the Carrier demonstrates it was prevented from doing so for reasons
beyond its control. The Carrier's prompt notice will ensure that the
notification period and the transitional care period run concurrently.

6.       Redate Section 1.24 TRANSITIONAL CARE as JAN 2002 and revise paragraphs
         (a) and (b), as follows:

SECTION 1.24

TRANSITIONAL CARE (JAN 2001)

         (a)      "Transitional care" is specialized care provided for up to 90
days or through the postpartum period, whichever is later, to an enrollee who is
undergoing treatment for a chronic or disabling condition or who is in the
second or third trimester of pregnancy when the Carrier terminates (1) all or
part of its FEHBP contract or (2) the enrollee's specialty provider contract for
reasons other than cause. The 90-day period begins the earlier of the date the
enrollee receives the notice required under Section 1.23, Notice to Enrollees on
Termination of FEHBP or Provider Contract, or the date the Carrier's or the
provider's contract ends.

         (b)      The Carrier shall ensure the following:

         (1)      If it terminates a part of its FEHB contract or a specialty
provider contract other than for cause, it allows enrollees who are undergoing
treatment for a chronic or disabling condition or who are in the second or third
trimester of pregnancy to continue treatment under the specialty provider for up
to 90 days, or through their postpartum period, whichever is later, under the
same terms and conditions that existed at the beginning of the transitional care
period; and

         (2)      If it enrolls a new member who voluntarily changed carriers
because the enrollee's former carrier was no longer available in the FEHB
Program, it provides transitional care for the enrollee if he or she is
undergoing treatment for a chronic or disabling condition or is in the second
or third trimester of pregnancy for up to 90 days, or through the postpartum
period, whichever is later, under the same terms and conditions the enrollee had
under the prior carrier.

                                       7
                                                                       (ER-2002)

<PAGE>

         (c)      If the Carrier terminates a mental health and substance abuse
specialty provider other than for cause, or changes the plan's benefit structure
for 2001 so that the member's out of pocket costs for mental health and
substance abuse services only are greater than they were in year 2000, it must
allow continued coverage with the specialty provider for up to ninety days under
the same terms and conditions that existed at the beginning of the transitional
care period. This transitional period will begin with the Carrier's notice to
the member of the change in coverage and ends 90 days after the notice.

         (d)      In addition, the Carrier shall (1) pay for or provide the
transitional care required under this clause at no additional cost to enrollees;

         (2)      require the specialty provider to promptly transfer all
medical records to the designated new provider during or upon completion of the
transition period, as authorized by the patient; and,

         (3)      require the specialty to give all necessary information to the
Carrier for quality assurance purposes.

7.       Redate Section 3.11 SURVEY CHARGES as JAN 2002 and revise paragraph
         (b), as follows:

SECTION 3.11

SURVEY CHARGES (JAN 2002)

         (a)      If the Carrier participates in an FEHB annual consumer
assessment survey, it shall pay OPM's contractor a pro rata share of the total
cost of consolidating and reporting the survey results to OPM. The Carrier shall
pay a separate fee for each plan option and/or rating area. The Carrier agrees
to pay the contractor's invoice within 30 days of the billing date. If the
Carrier does not remit payment to the contractor within 60 days of the billing
date, OPM shall withhold the amount due from the Carrier's subscription charges
according to FEHBAR 1652.232-71, Payments--experience-rated contracts, and
forward payment to the contractor.

         (b)      Costs incurred by the Carrier for contracting with a vendor to
conduct the survey shall be the Carrier's responsibility and constitute
allowable administrative charges.

8.       Redate Section 3.12 FEHB CLEARINGHOUSE as JAN 2002 and revise
         paragraph (a), as follows:

SECTION 3.12

FEHB CLEARINGHOUSE (JAN 2(02)

         (a)      The FEHB Clearinghouse will facilitate the reconciliation of
enrollments between carriers and Federal agencies. The Carrier shall pay a pro
rata share based on its proportion of FEHB premiums as determined by OPM for the
cost of developing and operating the Clearinghouse.

         (b)      OPM shall withhold the amount due from the Carrier's
subscription charges under the authority of FEHBAR 1652.232-71,
Payments--Experience-Rated Contracts, and shall forward payment to the FEHB
Clearinghouse.

9.       The following Federal Acquisition Regulation (FAR) clauses have been
         revised:

SECTION 5.1

DEFINITIONS (MAR 2001) (FAR 52.202-1)

         (a)      Agency head or head of the agency means the Secretary,
Attorney General, Administrator, Governor, Chairperson, or other chief official,
as appropriate) of the agency unless otherwise indicated, including any deputy
or assistant chief official of the executive agency.

         (b)      Commercial component means any component that is a commercial
item.

         (c)      Commercial item means--

                                       8
                                                                       (ER-2002)

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         (1)      Any item, other than real property, that is of a type
customarily used for nongovernmental purposes and that--

         (i)      Has been sold, leased, or licensed to the general public; or

         (ii)     Has been offered for sale, lease, or license to the general
public;

         (2)      Any item that evolved from an item described in paragraph
(c)(1) of this clause through advances in technology or performance and that is
not yet available in the commercial marketplace, but will be available in the
commercial marketplace in time to satisfy the delivery requirements under a
Government solicitation;

         (3)      Any item that would satisfy a criterion expressed in
paragraphs (c)(1) or (c)(2) of this clause, but for--

         (i)      Modifications of a type customarily available in the
commercial marketplace; or

         (ii)     Minor modifications of a type not customarily available in the
commercial marketplace made to meet Federal Government requirements. "Minor"
modifications means modifications that do not significantly alter the
nongovernmental function or essential physical characteristics of an item or
component, or change the purpose of a process. Factors to be considered in
determining whether a modification is minor include the value and size of the
modification and the comparative value and size of the final product. Dollar
values and percentages may be used as guideposts, but are not conclusive
evidence that a modification is minor;

         (4)      Any combination of items meeting the requirements of
paragraphs (c)(1), (2), (3), or (5) of this clause that are of a type
customarily combined and sold in combination to the general public;

         (5)      Installation services, maintenance services, repair services,
training services, and other services if such services are procured for support
of an item referred to in paragraphs (c)(1), (2), (3), or (4) of this clause,
and if the source of such services--

         (i)      Offers such services to the general public and the Federal
Government contemporaneously and under similar terms and conditions; and

         (ii)     Offers to use the same work force for providing the Federal
Government with such services as the source uses for providing such services to
the general public;

         (6)      Services of a type offered and sold competitively in
substantial quantities in the commercial marketplace based on established
catalog or market prices for specific tasks performed under standard commercial
terms and conditions. This does not include services that are sold based on
hourly rates without an established catalog or market price for a specific
service performed;

         (7)      Any item, combination of items, or service referred to in
subparagraphs (c)(1) through (c)(6), notwithstanding the fact that the item,
combination of items, or service is transferred between or among separate
divisions, subsidiaries, or affiliates of a Contractor, or

         (8)      A nondevelopmental item, if the procuring agency determines
the item was developed exclusively at private expense and sold in substantial
quantities, on a competitive basis, to multiple State and local Governments.

         (d)      Component means any item supplied to the Federal Government as
part of an end item or of another component, except that for use in 52.225-9,
and 52.225-11 see the definitions in 52.225-9(a) and 52.225-11(a).

         (e)      "Contracting Officer" means a person with the authority to
enter into, administer, and/or terminate contracts and make related
determinations and findings. The term includes certain authorized
representatives of the Contracting Officer acting within the limits of their
authority as delegated by the Contracting Officer.

         (f)      Nondevelopmental item means--

         (1)      Any previously developed item of supply used exclusively for
governmental purposes by a Federal agency, a State or local government, or a
foreign government with which the United

                                       9
                                                                       (ER-2002)

<PAGE>

States has a mutual defense cooperation agreement;

         (2)      Any item described in paragraph (f)(1) of this definition that
requires only minor modification or modifications of a type customarily
available in the commercial marketplace in order to meet the requirements of the
procuring department or agency; or

         (3)      Any item of supply being produced that does not meet the
requirements of paragraph (f)(1) or (f)(2) solely because the item is not yet in
use.

         (g)      Except as otherwise provided in this contract, the term
"subcontracts" includes, but is not limited to, purchase orders and changes and
modifications to purchase orders under this contract.

SECTION 5.14

UTILIZATION OF SMALL BUSINESS CONCERNS(1) (OCT 2000) (FAR 52.219-8)

         (a)      It is the policy of the United States that small business
concerns, veteran-owned small business concerns, service-disabled veteran-owned
small business concerns, HUBZone small business concerns, small disadvantaged
business concerns, and women-owned small business concerns shall have the
maximum practicable opportunity to participate in performing contracts let by
any Federal agency, including contracts and subcontracts for subsystems,
assemblies, components, and relaxed services for major systems. It is further
the policy of the United States that its prime contractors establish procedures
to ensure the timely payment of amounts due pursuant to the terms of their
subcontracts with small business concerns, veteran-owned small business
concerns, service-disabled veteran-owned small business concerns, HUBZone small
business concerns, small disadvantaged business concerns, and women-owned small
business concerns.

         (b)      The Contractor hereby agrees to carry out this policy in the
awarding of subcontracts to the fullest extent consistent with efficient
contract performance. The Contractor further agrees to cooperate in any studies
or surveys as may be conducted by the United States Small Business
Administration or the awarding agency of the United States as may be necessary
to determine the extent of the Contractor's compliance with this clause.

         (c)      Definitions. As used in this contract-

         "HUBZone small business concern" means a small business concern that
appears on the List of Qualified HUBZone Small Business Concerns maintained by
the Small Business Administration.

         "Service-disabled veteran-owned small business concern"--

         (1)      Means a small business concern--

                  (i)      Not less than 51 percent of which is owned by one or
more service disabled veterans or, in the case of any publicly owned business,
not less than 51 percent of the stock of which is owned by one or more
service-disabled veterans; and

                  (ii)     The management and daily business operations of which
are controlled by one or more service-disabled veterans or, in the case of a
veteran with permanent and severe disability, the spouse or permanent caregiver
of such veteran.

         (2)      Service-disabled veteran means a veteran, as defined in 38
U.S.C. 101(2), with a disability that is service-connected, as defined in 38
U.S.C. 101(16).

         "Small business concern" means a small business as defined pursuant to
Section 3 of the Small Business Act and relevant regulations promulgated
pursuant thereto.

         "Small disadvantaged business concern" means a small business concern
that represents, as part of its offer that--

----------
(1) SECTION 5.14 ONLY APPLIES TO
SIX PLANS PARTICIPATING IN the SMALL BUSINESS PILOT (NONE ARE EXPERIENCE-RATED
HMOs).

                                       10
                                                                       (ER-2002)

<PAGE>

         (1)      It has received certification as a small disadvantaged
business concern consistent with 13 CFR part 124, Subpart B;

         (2)      No material change in disadvantaged ownership and control has
occurred since its certification;

         (3)      Where the concern is owned by one or more individuals, the net
worth of each individual upon whom the certification is based does not exceed
$750,000 after taking into account the applicable exclusions set forth at 13 CFR
124.104(c)(2); and

         (4)      It is identified, on the date of its representation, as a
certified small disadvantaged business in the database maintained by the Small
Business Administration (PRO Net).

         "Veteran-owned small business concern" means a small business concern--

         (1)      Not less than 51 percent of which is owned by one or more
veterans (as defined at 38 U.S.C. 101(2)) or, in the case of any publicly owned
business, not less than 51 percent of the stock of which is owned by one or more
veterans; and

         (2)      The management and daily business operations of which are
controlled by one or more veterans.

         "Women-owned small business concern" means a small business concern--

         (1)      That is at least 51 percent owned by one or more women, or, in
the case of any publicly owned business, at least 51 percent of the stock of
which is owned by one or more women; and

         (2)      Whose management and daily business operations are controlled
by one or more women.

         (d)      Contractors acting in good faith may rely on written
representations by their subcontractors regarding their status as a small
business concern, a veteran-owned small business concern, a service-disabled
veteran-owned small business concern, a HUBZone small business concern, a small
disadvantaged business concern, or a women-owned small business concern.

SECTION 5.25

DRUG-FREE WORKPLACE (MAY 2001) (FAR 52.223-6)

         (a)      Definitions. As used in this clause,

         "Controlled substance" means a controlled substance in schedules I
through V of section 202 of the Controlled Substances Act (21 U.S.C. 812) and as
further defined in regulation at 21 CFR 1308.11-1308.15.

         "Conviction" means a finding of guilt (including a plea of nolo
contendere) or imposition of sentence, or both, by any judicial body charged
with the responsibility to determine violations of the Federal or State criminal
drug statutes.

         "Criminal drug statute" means a Federal or non-Federal criminal statute
involving the manufacture, distribution, dispensing, possession or use of any
controlled substance.

         "Drug-free workplace" means the site(s) for the performance of work
done by the Contractor in connection with a specific contract where employees of
the Contractor are prohibited from engaging in the unlawful manufacture,
distribution, dispensing, possession, or use of a controlled substance.

         "Employee" means an employee of a Contractor directly engaged in the
performance of work under a Government contract. Directly engaged is defined to
include all direct cost employees and any other Contractor employee who has
other than a minimal impact or involvement in contract performance.

         "Individual" means an offeror/contractor that has no more than one
employee including the offeror/contractor.

         (b)      The Contractor, if other than an individual, shall - within 30
days after award (unless a longer period is agreed to in writing for contracts
of 30 days or more performance duration); or as soon as possible for contracts
of less than 30 days performance duration -

         (1)      Publish a statement notifying its employees that the unlawful
manufacture, distribution, dispensing, possession, or use of a

                                       11
                                                                       (ER-2002)

<PAGE>

controlled substance is prohibited in the contractor's workplace and specifying
the actions that will be taken against employees for violations of such
prohibition;

         (2)      Establish an ongoing drug-free awareness program to inform
such employees about-

         (i)      The dangers of drug abuse in the workplace;

         (ii)     The contractor's policy of maintaining a drug-free workplace;

         (iii)    Any available drug counseling, rehabilitation, and employee
assistance programs; and

         (iv)     The penalties that may be imposed upon employees for drug
                  abuse violations occurring in the workplace.

         (3)      Provide all employees engaged in performance of the contract
with a copy of the statement required by subparagraph (b)(1) of this clause;

         (4)      Notify such employees in writing in the statement required by
subparagraph (b)(1) of this clause that, as a condition of continued employment
on this contract, the employee will

         (i)      Abide by the terms of the statement; and

         (ii)     Notify the employer in writing of the employee's conviction
under a criminal drug statute for a violation occurring in the workplace no
later than 5 days after such conviction.

         (5)      Notify the Contracting Officer in writing within 10 days after
receiving notice under subdivision (b)(4)(ii) of this clause, from an employee
or otherwise receiving actual notice of such conviction. The notice shall
include the position title of the employee;

         (6)      Within 30 days after receiving notice under subdivision
(b)(4)(ii) of this clause of a conviction, take one of the following actions
with respect to any employee who is convicted of a drug abuse violation
occurring in the workplace:

         (i)      Taking appropriate personnel action against such employee, up
to and including termination; or

         (ii)     Require such employee to satisfactorily participate in a drug
abuse assistance or rehabilitation program approved for such purposes by a
Federal, State, or local health, law enforcement, or other appropriate agency;
and

         (7)      Make a good faith effort to maintain a drug-free workplace
through implementation of subparagraphs (b)(1) through (b)(6) of this clause.

         (c)      The Contractor, if an individual, agrees by award of the
contract or acceptance of a purchase order, not to engage in the unlawful
manufacture, distribution, dispensing, possession, or use of a controlled
substance while performing this contract.

         (d)      In addition to other remedies available to the Government, the
Contractor's failure to comply with the requirements of paragraphs (b) or (c) of
this clause may, pursuant to FAR 23.506, render the Contractor subject to
suspension of contract payments, termination of the contract for default, and
suspension or debarment.

SECTION 5.54
PENALTIES FOR UNALLOWABLE COSTS (MAY 2001) (FAR 52.242-3)

         (a)      Definition. Proposal, as used in this clause, means either

         (1)      A final indirect cost rate proposal submitted by the
Contractor after the expiration of its fiscal year which--

         (i)      Relates to any payment made on the basis of billing rates; or

         (ii)     Will be used in negotiating the final contract price; or

         (2)      The final statement of costs incurred and estimated to be
incurred under the Incentive Price Revision clause (if applicable), which is
used to establish the final contract price.

                                       12
                                                                       (ER-2002)

<PAGE>

         (b)      Contractors which include unallowable indirect costs in a
proposal may be subject to penalties. The penalties are prescribed in 10 U.S.C.
2324 or 41 U.S.C. 256, as applicable, which is implemented in Section 42.709 of
the Federal Acquisition Regulation (FAR).

         (c)      The Contractor shall not include in any proposal any cost that
is unallowable, as defined in Subpart 2.1 of the FAR, or an executive agency
supplement to the FAR.

         (d)      If the Contracting Officer determines that a cost submitted by
the Contractor in its proposal is expressly unallowable under a cost principle
in the FAR, or an executive agency supplement to the FAR, that defines the
allowability of specific selected costs, the Contractor shall be assessed a
penalty equal to--

         (1)      The amount of the disallowed cost allocated to this contract;
plus

         (2)      Simple interest, to be computed--

         (i)      On the amount the Contractor was paid (whether as a progress
or billing payment) in excess of the amount to which the Contractor was
entitled; and

         (ii)     Using the applicable rate effective for each six-month
interval prescribed by the Secretary of the Treasury pursuant to Pub. L. 92-41
(85 Stat. 97).

         (e)      If the Contracting Officer determines that a cost submitted by
the Contractor in its proposal includes a cost previously determined to be
unallowable for that Contractor, then the Contractor will be assessed a penalty
in an amount equal to two times the amount of the disallowed cost allocated to
this contract.

         (f)      Determinations under paragraphs (d) and (e) of this clause are
final decisions within the meaning of the Contract Disputes Act of 1978 (41
U.S.C. 60-1, et seq.).

         (g)      Pursuant to the criteria in FAR 42.709-5, the Contracting
Officer may waive the penalties in paragraph (d) or (e) of this clause.

         (h)      Payment by the Contractor of any penalty assessed under this
clause does not constitute repayment to the Government of any unallowable cost
which has been paid by the Government to the Contractor.

SECTION 5.60
SUBCONTRACTS FOR COMMERCIAL ITEMS AND COMMERCIAL COMPONENTS (MAY 2001) (FAR
52.244-6)

         (a)      Definitions. As used in this clause--

         "Commercial item" has the meaning contained in the clause at 52.202-1,
Definitions.

         "Subcontract" includes a transfer of commercial items between
divisions, subsidiaries, or affiliates of the Contractor or subcontractor at
any tier.

         (b)      To the maximum extent practicable, the Contractor shall
incorporate, and require its subcontractors at all tiers to incorporate,
commercial items or nondevelopmental items as components of items to be supplied
under this contract.

         (c)(1)   The following clauses shall be flowed down to subcontracts for
commercial items:

         (i)      52.219-8, Utilization of Small Business Concerns (Oct 2000)
(15 U.S.C. 637(d)(2) and (3)), in all subcontracts that offer further
subcontracting opportunities. If the subcontract (except subcontracts to small
business concerns) exceeds $500,000 ($1,000,000 for construction of any public
facility), the subcontractor must include 52.219-8 in lower tier subcontracts
that offer subcontracting opportunities. -

         (ii)     52.222-26, Equal Opportunity (Feb 1999) (E.O. 11246). (iii)
52.222-35, Affirmative Action for Disabled. Veterans and Veterans of the Vietnam
Era (Apr 1998) (38 U.S.C. 4212(a)).

         (iv)     52.222-36, Affirmative Action for Workers with Disabilities
(Jun 1998) (29 U.S.C. 793).

         (v)      52.247-64, Preference for Privately Owned U.S.-Flagged
Commercial Vessels (Jun 2000) (46 U.S.C. Appx 1241) (flowdown not

                                       13
                                                                       (ER-2002)

<PAGE>

required for subcontracts awarded beginning May 1, 1996).

         (2)      While not required, the Contractor may flow down to
subcontracts for commercial items a minimal number of additional clauses
necessary to satisfy its contractual obligations.

         (d)      The Contractor shall include the terms of this clause,
including this paragraph (d), in subcontracts awarded under this contract

                                       14
                                                                       (ER-2002)

<PAGE>

                                   APPENDIX A

                                     ATTACH
                             2002 FEHB BROCHURE

                                        A

                                                                       (ER-2002)

<PAGE>

                                    TRIPLE-S

                              http://www.ssspr.com
[TRIPLE-S LOGO]                                                             2002

--------------------------------------------------------------------------------
                        A HEALTH MAINTENANCE ORGANIZATION
                        WITH A POINT OF SERVICE PRODUCT

                                                                 FOR CHANGES IN
                                                             BENEFITS SEE PAGE 8

SERVING: ALL OF PUERTO RICO

ENROLLMENT IN THIS PLAN IS LIMITED. YOU MUST LIVE IN OUR GEOGRAPHIC SERVICE AREA
TO ENROLL. SEE PAGE 7 FOR REQUIREMENTS.

ENROLLMENT CODES FOR THIS PLAN:

         891 SELF ONLY
         892 SELF AND FAMILY

 Authorized for distribution by the:
[US LOGO]         UNITED STATES                                      [FEHB LOGO]
                  OFFICE OF PERSONNEL MANAGEMENT
                  Retirement and Insurance Service
                  http://www.opm.gov/insure

                                                                       RI 73-016

<PAGE>

                                   APPENDIX B

             SUBSCRIPTION RATES, CHARGES, ALLOWANCES AND LIMITATIONS
                                    TRIPLE-S
                              CONTRACT NO. CS 1090
                            Effective January 1, 2002

(a)      Biweekly net-to-carrier rates, with appropriate adjustments for
         Enrollees paid on other than a biweekly basis, are as follows:

<TABLE>
<CAPTION>
                         Regular Rates              DoD Demonstration Project Rates
                         -------------              -------------------------------
<S>                      <C>                      <C>                          <C>
 Self only                 $87.64                 Self only                    $96.30
 Self and Family           $188.23                Self and Family              $227.98

</TABLE>

(b)      The amount of administrative expenses and charges to be included in the
         Annual Accounting Statement required by Section 3.2 shall be as set out
         in the schedule below:

<TABLE>
<CAPTION>
                 Item                                 Amount
                 ----                                 ------
<S>      <C>                        <C>
(i)      Administrative Expenses    Actual, but not-to exceed the Contractual
                                    Expense Limitation for 2002,* plus an amount
                                    sufficient to cover (a) the incremental
                                    costs associated with implementing the HIPAA
                                    electronic transaction, privacy, and
                                    security standards, not to exceed an amount
                                    to be agreed upon by both parties to this
                                    contract, and (b) the costs needed to pay
                                    the Plan's Independent Public Accountant to
                                    undertake the audits and agreed upon
                                    procedures required in the "FEHBP
                                    Experienced-Rated Carrier and Service
                                    Organization Audit Guide."

(ii)     Taxes                      Actual (except that premium taxes as defined
                                    are not allowable).

(iii)    Service Charge             $625,128.00

</TABLE>

*The Contractual Expense Limitation for 2002 is the Contractual Expense
Limitation for 2001 ($5,385,148), plus or minus adjustments for inflation and
enrollment changes. The base shall be adjusted by percentage changes in
enrollment (from OPM's March 2001 to March 2002 headcount) and by the percentage
change in the average monthly Consumer Price Index for All Urban Consumers
(published monthly by the Bureau of Labor Statistics) from the 12 month period
ending on September 30, 2001, to the 12 month period ending on September 30,
2002.

                                                                       (ER-2002)

<PAGE>

[US LOGO]          United States
                   OFFICE OF
                   PERSONNEL MANAGEMENT          WASHINGTON, D.C. 20415

                                              IN REPLY REFER TO: YOUR REFERENCE:

Mr. Miguel A. Vazquez Deynes, President
Triple-S
1441 Roosevelt Avenue
San Juan PR 00936-3628

 RE: CY 2002 FEHB PROGRAM STANDARD CONTRACT FOR EXPERIENCE RATED HMOS

Dear Mr. Vazquez Deynes:

We are enclosing amendments to the standard contract for the year 2002. Please
have each of the two copies signed and return both of them to us by December 17,
2001. The enclosures represent the final contract language, and we will not be
taking additional comments on them. We thank you for your comments and
suggestions. We carefully considered them and as a result have made some
modifications.

Section 1.4 Incorporation of Laws and Regulations

This change clarifies the clause regarding implementation of regulatory changes.
We received several comments expressing concerns about increased carrier
liability. We have clarified our intent to minimize this concern in the final
contract clause.

Section 1.7 Statistics and Special Studies

The proposal to add a clause related to reports for mental health and substance
abuse parity evaluation is revoked. OPM will rely on existing contract authority
in Section 1.7(b).

Section 1.9 FEHB Quality Assurance

This section is changed to clarify that the costs of OPM's effectiveness of care
measures are allowable and are subject to the administrative cost limitation for
experience rated health plans. (NOTE: This change does not apply to community
rated plans.)

Also, this section is changed to reflect OPM's requirement that fee-for-service
carriers and HMOs with over 500 enrollees must demonstrate their commitment to
accreditation. If they haven't already obtained and maintained accreditation,
they must provide us with business plans that include steps and timelines in CY
2002 for implementing accreditation.

<PAGE>

We received several comments from fee-for-service carriers seeking relief from
the administrative cost ceiling. We believe our incremental approach to
enhancing the quality of health plans in the FEHB Program is within reason and
should not have a significant impact. Therefore, we believe these types of costs
should remain incorporated under the plans' administrative cost ceilings. We
intend to work closely with health plans and accrediting organizations to find
feasible ways to accomplish this goal.

Section 1.13 Information and Marketing Materials

This section is changed to clarify the responsibility for the accuracy of the
brochure and the timeliness of brochure distribution.

We received several comments that this clause is unnecessary. However, we
believe it is important to ensure all parties to the contract clearly understand
the carriers bear responsibility for accurate statements of their benefits and
for ensuring their members receive this information.

Section 1.22 Administrative Simplification - HIPAA

This section requires carriers to implement HIPAA electronic transaction
standards and HIPAA privacy standards promulgated by Health and Human Services'
regulations. (NOTE: This change is Section 1.21 for community rated contracts).

OPM is required to operate under the regulations issued by the Department of
Health and Human Services just like other employers. We received several
comments with concerns about both timing and costs of implementing HIPAA. We
have adopted a suggested contract clause regarding implementation dates. OPM
will assess on a case by case basis the costs carriers attribute to HIPAA
implementation. OPM has convened a carrier workgroup to deal with implementation
issues and concerns.

Some carriers commented that since the effective date for implementing HIPAA
requirements wasn't until 2003, the clause wasn't needed in CY 2002. However,
carriers will need to carry out pre-implementation activities during 2002 in
order to meet the regulatory timeframes for implementation. In addition, we will
be examining the need for additional contract clauses for CY 2003 around the
issue of confidentiality.

Section 1.24 Notice to Enrollees on Termination of FEHBP or Provider Contract

This is a technical change to the language on continued care for postpartum.
(NOTE: This change is in Section 1.23 for HMO contracts).

Section 1.25 Transitional care

This is a technical change to the language on continued care for postpartum. It
also deletes the clause allowing members to continue use of their mental health
providers through the transition period from CY2000 to CY2001. (NOTE: This
change is in Section 1.24 for HMO contracts).

<PAGE>

Section 3.11 Survey Charges

This change clarifies that consumer assessment survey costs are allowable
administrative charges for experience rated contracts. (NOTE: This would be in
Section 3.7 for community rated contracts, but this change does not apply to
community rated carriers).

Section 3.12 FEHB Clearinghouse

This section is changed to clarify that the clearinghouse facilitates enrollment
reconciliation among carriers and agencies and that the pro-rata cost for the
clearinghouse is based on FEHB premiums. (NOTE: This change applies to Section
3.6 Discrepancies Between Enrollment and Payments to Carrier for community rated
contracts).

We received several comments with concerns that this clause changed the basis
for allocating costs from enrollment to premiums. OPM issued an All Carrier
letter dated April 25, 2001 (CL 2001-13) on the FEHB clearinghouse that
described this change in OPM policy and procedures.

Section 5.1 Definitions

This is a text change to comply with the Federal Acquisition Regulation (FAR).

Section 5.14 Utilization of Small Business Concerns

This adds veterans-owned business to the list of small businesses in OPM's pilot
project. (NOTE: This only affects the six health plans that are participating in
the pilot.)

Section 5.25 Drug Free Workplace

This is a FAR text change.

Section 5.54 Penalties for Unallowable Costs

This is a FAR text change. (NOTE: The clause does not apply to community rated
contracts).

Section 5.60 Subcontracts for Commercial Items

This is a FAR text change that adds a small business-subcontracting requirement
for contract amounts above $500,000. (NOTE: The clause does not apply to
community rated contracts).

Appendix F

This Appendix applies only to the six health plans that are participating in
OPM's pilot project on small business subcontracting. The change replaces the
current text on small business plans and adds veterans-owned businesses.

                                       3

<PAGE>

Please call your OPM Contract Specialist if you have questions about the final
contract changes.

                                       Sincerely,

                                       /s/ Daniel A. Green
                                       ----------------------------------------
                                       Daniel A. Green
                                       Contracting Officer
                                       Office of Insurance Programs

Enclosure

                                       4<PAGE>
                                                                    EXHIBIT 10.6

                                   $41,000,000

                                CREDIT AGREEMENT

                            Dated as of June 29, 1999

                                      Among

                         TRIPLE-S MANAGEMENT CORPORATION

                                 as the Borrower

                                       and

                              FIRSTBANK PUERTO RICO

                                  as the Lender

<PAGE>

                                CREDIT AGREEMENT

                            Dated as of June 29, 1999

         TRIPLE-S MANAGEMENT CORPORATION, a Puerto Rico corporation (the
"Borrower"), and FIRSTBANK PUERTO RICO, a banking corporation validly organized
and existing under the laws of the Commonwealth of Puerto Rico (the "Lender")
agree as follows:

                                    ARTICLE 1
                        DEFINITIONS AND ACCOUNTING TERMS

         SECTION 1.1.      CERTAIN DEFINED TERMS.     Unless otherwise defined
in this Agreement, the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):

                  "Affiliate" means with respect to any Person, any other Person
(i) which directly or indirectly through one or more intermediaries controls, or
is controlled by, or is under common control with, such Person, (ii) which
directly or indirectly, of record or beneficially, owns or holds ten percent
(10%) or more of the shares of any class of the capital stock of such Person
having voting powers, or (iii) ten percent (10%) or more of the shares of such
stock of which are owned or held, directly or indirectly, of record or
beneficially, for such Person. For the purposes of this Agreement, the term
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of management and policies of a Person, whether through
ownership of common stock, by contract or otherwise; all of the Borrower's
officers, shareholders owning ten percent (10%) or more of the common stock of
the Borrower, directors, subsidiary corporations, joint venturers and partners
shall be deemed to be the Borrower's Affiliates.

<PAGE>

                  "Agreement" or "this Agreement" shall include all amendments,
modifications and supplements hereto and shall refer to this Agreement as the
same may be in effect at the time such reference becomes operative.

                  "Ancillary Agreements" means any supplemental agreement,
undertaking, instrument, document or other writing executed or delivered by the
Borrower as a condition to this Agreement or otherwise in connection herewith,
and any collateral granted pursuant thereto, and all other contracts, agreements
and documents related thereto and all amendments, modifications or supplements,
and appendices, exhibits and schedules to any of the foregoing.

                  "Assignment of Lease Agreements" means assignment agreement(s)
in form and substance acceptable to the Lender, from the Borrower to the Lender,
in respect of all Lease Agreements, as amended, supplemented, replaced, extended
or otherwise modified from time to time.

                  "Borrower" has the meaning assigned to that term in the
Preamble.

                   "Borrower's Computer Systems" has the meaning assigned to
that term in Section 4.1(w).

                  "Business Day" means a day of the year, excluding Saturdays,
Sundays and legal holidays, on which banks are not required or authorized to
close in San Juan, Puerto Rico.

                  "Capitalized Lease" has the meaning assigned to that term in
the definition of Debt.

                  "Charge(s)" means all Federal, State, Commonwealth, county,
city, municipal, local, foreign or other governmental (including, without
limitation, PBGC) taxes at the time due and payable, levies, assessments,
charges, liens, claims or encumbrances upon or relating to (i) the Collateral,
(ii) the Obligations, (iii) the Borrower's employees, payroll, income or gross
receipts, (iv) the Borrower's ownership or use of any of its assets, or (v) any
other aspect of the Borrower's business and properties.

                  "Closing Date" means the date of this Agreement.

                                      -2-

<PAGE>

                  "Code" means the United States Internal Revenue Code of 1986,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder.

                  "Collateral" means and includes all real and personal property
(tangible and intangible, corporeal and incorporeal) and all rights, title and
interest in which a lien and/or a security interest is granted, or purported to
be granted, in accordance with the terms of this Agreement and/or the Collateral
Documents.

                  "Collateral Documents" means, collectively, the Assignment of
Lease Agreements, the Mortgage Notes, the Mortgages, the Mortgage Notes Pledge
and Security Agreement and the Ancillary Agreements, as amended, supplemented,
extended or otherwise modified from time to time, and any other documents, forms
and certificates executed, delivered, filed, or recorded in connection with such
documents.

                  "Commonwealth" means the Commonwealth of Puerto Rico and its
political subdivisions, municipalities, agencies and instrumentalities.

                  "Contingent Obligation" means any other obligation
guaranteeing any indebtedness, leases, dividends or other obligations of any
other Person in any manner, whether directly or indirectly.

                  "Debt" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all Obligations of such
Person for the deferred purchase price of property or services (other than trade
payables and accrued expenses incurred in the ordinary course of such Person's
business), (c) all Obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (d) all Obligations of such Person
created or arising under any conditional sale or other title retention agreement
with respect to property acquired by such Person (even through the rights and
remedies of the seller or lender under such agreement in the event of default
are limited to repossession or sale of such property), (e) the principal
component of all Obligations of such Person as lessee under leases that have
been or should be, in accordance with Generally Accepted Accounting Principles,
recorded as capital

                                      -3-

<PAGE>

leases ("Capitalized Leases") which principal component has been or should, at
the time of determination, be capitalized on a balance sheet in accordance with
Generally Accepted Accounting Principles, (f) all Obligations, contingent or
otherwise, of such Person under acceptance, letter of credit or similar
facilities, (g) all Obligations of such Person to purchase, redeem, retire,
defease or otherwise make any payment in respect of any capital stock of or
other ownership or profit interest in such Person or any other Person or any
warrants, rights or options to acquire such capital stock, (h) all Debt of
others referred to in clauses (a) through (g) above guaranteed directly or
indirectly in any manner by such Person, or in effect guaranteed directly or
indirectly by such Person through an agreement (i) to pay or purchase such Debt
or to advance or supply funds for the payment or purchase of such Debt, (ii) to
purchase, sell or lease (as lessee or lessor) property, or to purchase or sell
services, primarily for the purpose of enabling the debtor to make payment of
such Debt or to assure the holder of such Debt against loss, (iii) to supply
funds to or in any other manner invest in the debtor (including any agreement to
pay for property or services irrespective of whether such property is received
or such services are rendered) to assure a creditor against loss or (iv)
otherwise to assure a creditor against loss, and (v) all Debt referred to in
clauses (a) through (g) above secured by (or for which the holder of such Debt
has an existing right, contingent or otherwise, to be secured by) any Lien on
property (including, without limitation, accounts and contract rights) owned by
such Person, even though such Person has not assumed or become liable for the
payment of such Debt, in an amount equal to the lesser of the amount of the Debt
secured by the Lien or the fair market value of such property.

                  "Debt Service" means for any period, the sum for the Borrower
(determined on a combined basis without duplication in accordance with Generally
Accepted Accounting Principles), of the following: (a) all payments of principal
of Debt scheduled to be made during such period plus (b) all interest in respect
of Debt

                                      -4-

<PAGE>

capitalized or expended during such period (whether or not actually paid during
such period).

                  "Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be given or
time elapse or both.

                  "Deposits" has the meaning assigned to that term in Section
2.4(d).

                  "Environment" means soil, land, land surface or subsurface
strata, surface waters (including navigable waters and ocean waters), ground
waters, drinking water supply, stream sediments, ambient air and any other
environmental medium.

                  "Environmental Action" means any administrative, regulatory or
judicial action, suit, demand, demand letter, claim, notice of non-compliance or
violation, investigation, proceeding, consent order or consent agreement
relating in any way to any Environmental Law or any Environmental Permit
including, without limitation, (a) any claim by any Governmental Authority for
enforcement, cleanup, removal, response, remedial or other actions or damages
pursuant to any Environmental Law and (b) any claim by any third party seeking
damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from hazardous or toxic materials or arising from
alleged injury to health, safety or the environment.

                  "Environmental Law" means any federal, state or local
(including, without limitation, the Commonwealth of Puerto Rico) law, rule,
regulation, order, writ, judgment, injunction, decree, determination or award
relating to the environment, health, safety or hazardous or toxic materials,
including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act, the Resource Conservation and Recovery Act, the
Hazardous Materials Transportation Act, the Clean Water Act, the Toxic
Substances Control Act, the Clean Air Act, the Safe Drinking Water Act, the
Atomic Energy Act, the Federal Insecticide, Fungicide and Rodenticide Act and
the Occupational Safety and Health Act, each as amended from time to time.

                                      -5-

<PAGE>

                  "Environmental Permit" means any permit, approval,
identification number, license or other authorization required under any
Environmental Law.

                  "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.

                  "Event of Default" has the meaning assigned to that term in
Section 6.1.

                  "Excess Cash Flow" means net operating income for the Borrower
before depreciation, amortization, non-cash charges and interest expense less
Debt Service

                  "Existing Debt" has the meaning assigned to that term in
Section 4.1(q).

                  "Fiscal Year" means the twelve-month period commencing on
January 1 and ending on December 31 of every year.

                  "Generally Accepted Accounting Principles" means generally
accepted accounting principles consistently applied and maintained throughout
the period indicated and consistent with the prior financial practice of the
Borrower, except for changes mandated by the Financial Accounting Standards
Board or any similar accounting authority of comparable standing.

                  "Governmental Approval" means any applicable consent, permit,
license or other approval issued by any agency, department, bureau, division or
other instrumentality of any Governmental Authority.

                  "Governmental Authority" means any municipal, Commonwealth,
state or federal governmental authority (domestic or foreign) having
jurisdiction over the Borrower or the transactions contemplated in this
Agreement.

                  "Hazardous Material" means and includes, but shall not be
limited to, any (i) "hazardous substances", "pollutant" or "contaminant" (as
defined in Sections 101(14), (33) of CERCLA, 42 U.S.C. ss.9601(14), (33) or the
regulations designated pursuant to Section 102 of CERCLA, 42 U.S.C. ss.9602 and
found at 40 C.F.R. Part 302), including any element, compound, mixture, solution
or substance which is or may be designated pursuant to Section 102 of CERCLA
(ii) all substances which are or may be designated

                                      -6-

<PAGE>

pursuant to Section 311 (b) (2) (A) of the Federal Water Pollution Control Act,
33 U.S.C. ss.1251, 1321 (b) (2) (A), as amended ("FWPCA"); (iii) any hazardous
waste having the characteristics which are identified under or listed pursuant
to Section 3001 of the Resource Conservation and Recovery Act, 42 U.S.C.
ss.6901, 6921, as amended ("RCRA") or having such characteristics which shall
subsequently be considered under RCRA to constitute a hazardous waste; (iv) any
substance containing petroleum, as that term is defined in Section 9001(8) of
RCRA, 42 U.S.C. ss.991(8) or 40 C.F.R. Part 280; (v) any toxic pollutant which
is or may be listed under Section 3077 (a) or the FWPCA, 33 U.S.C. ss.1317(a);
(vi) any hazardous air pollutant which is or may be listed under Section 112 of
the Clean Air Act, 42 U.S.C. ss.7401, 7412, as amended; (vii) any imminently
hazardous chemical substance or mixture with respect to which action has been or
may be taken pursuant to Section 16 of the Toxic substances Control Act, 15
U.S.C. ss.2601, 2606, as amended; (viii) waste oil and other petroleum products;
(ix) any asbestos, asbestos containing material or urea formaldehyde or material
which contains it; or (x) any other toxic materials, contaminants, or hazardous
substances or wastes pursuant to any Environmental Law.

                  "Indebtedness" means all liabilities, obligations and
indebtedness of any and every kind and nature including, without limitation, all
liabilities and all obligations to trade creditors, whether now or hereafter
owing, arising, due or payable, from the Borrower to any Person and howsoever
evidenced, created, incurred, acquired or owing, whether primary, secondary,
direct, fixed or otherwise.

                  "Interest Period" means, the period commencing on the date of
the Loan and ending on the last day of the period selected by the Borrower
pursuant to the provisions below and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest Period and
ending on the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be one, two,
three or six months or longer periods not exceeding five years; in each case as
the Borrower may, upon notice

                                      -7-

<PAGE>

received by the Lender not later than 2:00 P.M. (Puerto Rico time) two Business
Days prior to the first day of such Interest Period, select; provided, however,
that:

                           (a)      whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding Business Day,
provided, that if such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last day of such
Interest Period shall occur on the next preceding Business Day; and

                           (b)      the Borrower may not select any Interest
Period that ends after the Termination Date.

                  "Lease Agreements" means any and all contracts and agreements
(whether now existing or hereinafter arising) for the lease and/or use of space
in the Property.

                  "Lender" has the meaning assigned to that term in the
Preamble.

                  "LIBOR" means, as of a particular date of determination and
for the Interest Period selected by the Borrower, the offered rate for funds in
United States dollars in the London interbank market (rounded upward to the
nearest 1/16 of 1%), as published by Telerate Systems, Inc. (currently on page
3750 of its financial information reporting services) as of 11:00 a.m. London
Time, on the date which is two (2) Business Days prior to such date of
determination, or if such quotations are no longer published or otherwise cease
to be available, then the offer quotation for the rate of interest on such
deposits as published in The Wall Street Journal on the date of publication of
such journal immediately preceding the date of determination.

                  "Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance on title
to real property.

                                      -8-

<PAGE>

                  "Loan" means the loan made by the Lender to the Borrower
pursuant to Article 2.

                  "Loan Documents" means collectively, this Agreement, the Note,
the Collateral Documents, the Ancillary Agreements and, on and after the date of
delivery thereof, each other agreement, document or instrument delivered under
the terms of this Agreement or any other Loan Document, in each case as amended
or otherwise modified from time to time.

                  "Material Adverse Change" means any material adverse change
in the business, financial condition, operations or properties of the Borrower
and its Subsidiaries taken as a whole.

                  "Material Adverse Effect" means a material adverse effect on
(a) the business, financial condition, operations or properties of the Borrower
and its Subsidiaries taken as a whole, (b) the rights and remedies of the Lender
under any Loan Document or (c) the ability of the Borrower to perform its
Obligations under any Loan Document to which it is or is to be a party.

                  "Note" means the promissory note of the Borrower payable to
the order of the Lender, in substantially the form of Exhibit A, evidencing the
aggregate indebtedness of the Borrower to the Lender resulting from the Loan
made to the Borrower by the Lender.

                  "Notice of Selection" has the meaning assigned to that term in
Section 2.4(b).

                  "Mortgages" means the mortgage(s) and extensions and
modifications thereof, in form and substance acceptable to the Lender,
constituted by the Borrower to secure the corresponding Mortgage Note.

                  "Mortgage Notes" means collectively the mortgage notes in form
and substance acceptable to the Bank, issued by the Borrower, secure by the
corresponding Mortgage and pledged to the Lender pursuant to the Mortgage Notes
Pledge and Security Agreement.

                  "Mortgage Notes Pledge and Security Agreement" shall mean the
pledge and security agreement executed by the Borrower in favor of the Lender,
in form and substance acceptable to the

                                      -9-

<PAGE>

Lender, in connection with the Mortgage Notes, as amended, supplemented,
replaced, extended or otherwise modified from time to time.

                  "Notice of Prepayment" shall have the meaning set forth in
Section 2.8 hereof.

                  "Obligations" means, with respect to any Person, any
obligation of such Person of any kind (including, without limitation,
overdrafts), including, without limitation, any liability of such Person on any
claim, whether or not the right of any creditor to payment in respect of such
claim is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured or unsecured, and
whether or not such claim is discharged, stayed or otherwise affected by any
proceeding referred to in Section 6.1(f). Without limiting the generality of the
foregoing, the Obligations of the Borrower under the Loan Documents include (a)
the obligation to pay principal, interest, Charges, expenses, fees, attorneys'
fees and disbursements, indemnities and other amounts payable by the Borrower
under any Loan Document, and (b) the obligation to reimburse any amount in
respect of any of the foregoing that the Lender, in its sole discretion, may
elect to pay or advance on behalf of the Borrower.

                  "Permitted Liens" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding shall have
been commenced: (a) Liens for taxes, assessments and governmental charges or
levies to the extent not required to be paid under Section 5.1(i); (b) Liens
imposed by law, such as materialmen's, mechanics', carriers', workmen's and
repairmen's Liens and other similar Liens arising in the ordinary course of
business securing obligations that are not overdue for a period of more than
thirty (30) days; (c) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or statutory
obligations; (d) easements, rights of way and other encumbrances on title to
real property that do not render title to the property encumbered thereby
unmarketable or materially adversely affect the use of such property for its
present purposes; (e) Liens securing

                                      -10-

<PAGE>

surety, indemnity and performance bonds entered into in the ordinary course of
business as to which full reserves are maintained; and (f) Liens in existence on
the Closing Date, without giving effect to any extensions or renewals thereof.

                  "Person" means and includes any individual, sole
proprietorship, partnership, joint venture, trust, unincorporated organization,
association, corporation, institution, entity, party or government (whether
national, federal, state, county, city, municipal, or otherwise, including,
without limitation, any instrumentality, division, agency, body or department
thereof), and including the Borrower.

                  "Plan" means each employee plan or other plan maintained for
the employees of the Borrower or any Subsidiary of the Borrower and covered by
Title IV or ERISA.

                  "Property" means, collectively, each Mortgaged Property as
defined in the corresponding Mortgage.

                  "Regulatory Chance" means any change after the date of this
Agreement in United States, Commonwealth, state or municipal laws or regulations
or the adoption or making after such date of any interpretations, directives or
requests applying to a class of banks including the Lender of or under any
United States, Commonwealth, state or municipal, laws or regulations (whether or
not having the force of law) by any court or governmental or monetary authority
charged with the interpretation or administration thereof.

                  "Release" means any releasing, spilling, leaking, pumping,
pouring. emitting, emptying, discharging, infecting, escaping, leaching,
disposing or dumping into the Environment.

                  "Reportable Event" has the meaning assigned to that term in
Title IV of ERISA.

                  "Solvent" means, as to any Person, that (a) the fair value and
present fair saleable value of such Person's assets is in excess of the total
amount of such Person's stated liabilities; (b) the present fair saleable value
of such Person's assets is in excess of the amount that will be required to pay
such Person's probable liability on such Person's Debt as such Debt becomes
absolute and mature; (c) such Person does not have

                                      -11-

<PAGE>

unreasonably small capital to carry on the business in which such Person is
engaged and all businesses in which such Person is about to engage; and (d) such
Person has not incurred Debt beyond such Person's ability to pay such Debt as it
matures.

                  "Subsidiary" means any corporation of which more than fifty
percent (50%) of the outstanding capital stock having ordinary voting power to
elect a majority of the board of directors of such corporation is at the time
directly or indirectly owned or controlled by the Borrower or by one or more
Subsidiaries.

                  "Termination Date" means the earlier of (i) July 1st, 2024 and
(ii) the date of termination of this Agreement pursuant to Section 6.1.

                  "Termination Event" means (i) a Reportable Event described in
Section 4043 of ERISA and the regulations issued thereunder (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 Affiliate
of the Borrower 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 proceedings
to terminate a Plan by the PBGC under Section 4042 of ERISA, 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.

                  "Threat of Release" means a substantial likelihood of a
Release which might require action or order to prevent or mitigate damage to the
Environment that might result from such Release.

                  "Title Insurance Policy" means a Mortgagee's title insurance
policy in form and substance acceptable to the Lender insuring that each
Mortgage is a first lien on the corresponding Property.

                  "Year 2000 Plan" has the meaning assigned to that term in
Section 5.1(1).

                                      -12-

<PAGE>

                  Year 2000 Problem" has the meaning assigned to that term in
Section 4.1(w).

         SECTION 1.2.      COMPUTATION OF TIME PERIODS. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
means "to but excluding".

         SECTION 1.3.      ACCOUNTING TERMS. All accounting terms not
specifically defined herein shall be construed in accordance with Generally
Accepted Accounting Principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.1 (e).

         SECTION 1.4.      OTHER DEFINITIONAL PROVISIONS. The words "hereof",
"herein" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Article, Section, Recital, Schedule, Exhibit and like
references are to this Agreement unless otherwise specified. Wherever from the
context it appears appropriate, each term stated in either the singular or
plural shall include the singular and the plural, and pronouns stated in the
masculine, feminine or neuter gender shall include the masculine, the feminine
and the neuter.

                                    ARTICLE 2
                          AMOUNTS AND TERMS OF THE LOAN

         SECTION 2.1.      THE LOAN. The Lender agrees, on the terms and
conditions hereinafter set forth and in reliance upon the representations and
warranties of the Borrower contained herein and/or in the other Loan Documents
and if no Event of Default or Default has occurred or is continuing, to make a
term loan (the "Loan") to the Borrower on the Closing Date in an aggregate
principal amount not to exceed forty one million dollars ($41,000,000) (the
"Commitment"). The proceeds of the Loan shall

                                      -13-

<PAGE>

be used by the Borrower to finance the acquisition of real estate properties
from its Subsidiaries and from Banco Bilbao Vizcaya Puerto Rico, to pay
reasonable closing and legal costs and expenses incurred in connection with this
Agreement and the other Loan Documents, for business investments, including the
acquisition of other businesses, and for working capital requirements of the
Borrower in respect to the business in which the Borrower is presently engaged.

         SECTION 2.2.      THE NOTE.

                  (a) The indebtedness of the Borrower in respect of the Loan
shall be evidenced by a promissory note of the Borrower, dated on the Closing
Date, in form and substance satisfactory to the Lender (the "Note"), in the
amount of the Loan and payable to the order of the Lender, representing the
obligation of the Borrower to pay the amount of the Loan, with interest thereon
as provided hereinafter.

                  (b) The amount of the Loan made to the Borrower by the Lender,
the interest rate, and all repayments with respect to the Loan shall be recorded
by the Lender. The failure to record, or any error in recording, shall not,
however, affect the obligations of the Borrower hereunder or under the Note to
repay the principal amount of the Loan together with all interest accruing
thereon. The records maintained by Lender in the ordinary course of business
shall constitute prima facie evidence of the outstanding amount of the Lender's
Loan.

         SECTION 2.3.      REPAYMENT. The Borrower shall repay to the Lender
the aggregate outstanding principal amount of the Loan made to the Borrower by
no later than the Termination Date in consecutive monthly installments as set
forth in the Note evidencing the Loan.

         SECTION 2.4.      INTEREST. (a) The Borrower shall pay interest on the
unpaid principal amount of the Loan made by the Lender from the date of the Loan
until such principal amount is paid in full, at a rate per annum equal at all
times to the sum of LIBOR plus 100 basis points, payable monthly in arrears on
the first Business Day of each month and on the date the Loan is paid in full.
The interest rate on the Loan shall be determined by the

                                      -14-

<PAGE>

Lender on the basis of the Interest Period selected by the Borrower. The Lender
shall give prompt written notice to the Borrower of the applicable interest rate
as determined by the Lender for purposes of this Section 2.4 (a).

                  (b) The Borrower may on any Business Day, upon notice (a
"Notice of Selection") given to the Lender not later than 2:00 P.M. (Puerto Rico
time) on the second Business Day prior to the date of the proposed selection of
an Interest Period and subject to the provisions of this Agreement, select
Interest Periods for all (or any portion thereof of not less than $250,000 or an
integral multiple of $50,000 in excess thereof) of the Loan; provided, however,
that any selection shall be effective on, and only on, the last day of an
Interest Period. Each such Notice of Selection shall, within the restrictions
specified above, specify the duration of the Interest Period for the Loan or any
portion thereof and shall be irrevocable and binding on the Borrower. If the
Borrower shall fail to select the duration of any Interest Period in accordance
with the provisions contained in the definition of "Interest Period" in Section
1.1, the applicable Interest period will automatically, on the last day of the
then existing Interest Period therefore, convert into a one month Interest
Period.

                  (c) The Lender shall be entitled to rely on any telephonic
notice given by the Borrower pursuant to subsection (b) above (regardless of
whether or not such telephonic notice is subsequently confirmed in writing, but
without prejudice to the Borrower's obligation to deliver such written
confirmation) which the Lender in good faith believes to be from a responsible
officer of the Borrower, and the Borrower hereby waives any right that it may
have to dispute the accuracy of the Lender's transcription or record of such
telephonic notice.

                  (d) The Borrower may from time to time make and maintain
demand and/or time deposits (the "Deposits") with the Lender. Notwithstanding
anything to the contrary contained in Section 2.4 (a) above, during the time the
Borrower maintains Deposits with the Lender in an aggregate principal amount of
not less than $1,000,000 and in integral multiples of $250,000, the

                                      -15-

<PAGE>

Borrower shall pay interest to the Lender on that portion of the Loan equal to
the Deposits during the time the Deposits are maintained with the Lender at a
rate per annum equal to 100 basis points over and above the rate of interest
paid by the Lender to the Borrower on the Deposits.

         SECTION 2.5.      INCREASED COSTS. (a) If, due to either a Regulatory
Change or any change (including any change by way of imposition or increase of
reserve requirements) in, or in the interpretation of, any law or regulation
occurring after the Closing Date there shall (i) impose, modify or deem
applicable any reserve, special deposit or similar requirement against assets
held by, or deposits in or for the account of, or loans by, or any other
acquisition of funds for contributions by the Lender; or (ii) impose on the
Lender any other condition regarding this Agreement; or (iii) subject the Lender
to any tax (including, without limitation, United States interest equalization
tax), levy, impost, duty, charge, fee, deduction or withholding on or from
payments due from the Borrower hereunder; or (iv) change the basis of taxation
of payments due hereunder from the Borrower to the Lender (other than by a
change in taxation of the overall net income of the Lender); or (v) the
compliance with any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of law) issued after the
Closing Date, and as a result of any of the above there shall be any increase in
the cost to the Lender of agreeing to make or making, funding or maintaining the
unpaid balance of the Loan, then the Borrower shall from time to time, within 30
days after notice and demand by the Lender, pay to the Lender additional amounts
sufficient to compensate the Lender for such increased cost. A certificate as to
the amount of such increased cost, submitted to the Borrower by the Lender,
shall be conclusive and binding for all purposes, absent manifest ERROR. The
Lender will determine the amount of the increased cost payable under this
sub-section (a) acting reasonably and in good faith and using averaging and
attribution methods among its customers which are fair and reasonable.

                                      -16-

<PAGE>

                  (b) If the Lender determines that compliance with any law or
regulation or any guideline or request from any central bank or other
Governmental Authority (whether or not having the force of law) affects or would
affect the amount of capital required or expected to be maintained by the Lender
or any corporation controlling the Lender and that the amount of such capital is
increased by or based upon the existence of the Lender's commitment to lend
hereunder and other commitments of this type (considering the Lender's policy
regarding capital adequacy), then, within 30 days after notice and demand by the
Lender, the Borrower shall pay to the Lender, from time to time as specified by
the Lender, additional amounts sufficient to compensate the Lender or such
corporation in the light of such circumstances, to the extent that the Lender
reasonably and in good faith determines such increase in capital to be allocable
to the existence of the Lender's commitment to lend hereunder (using averaging
and attribution methods among its customers which are fair and reasonable). A
certificate as to such amounts submitted to the Borrower by the Lender shall be
conclusive and binding for all purposes, absent manifest error.

                  (c) In order to be entitled to compensation under subsection
(a) or (b) of this Section 2.5, the Lender shall notify the Borrower of any
event occurring after the date of this Agreement entitling the Lender to
compensation under sub-section (a) or (b) of this Section 2.5 as promptly as
practicable, but in any event within 30 days, after the Lender obtains actual
knowledge thereof. Notwithstanding anything to the contrary contained in Section
2.7, the Borrower may, within 60 days after receipt of the notice provided in
this sub-section (c), prepay in whole, without penalty or premium, the Loan
together with interest and any compensation under sub-section (a) or (b) of this
Section 2.5 accruing up to and including the date of such prepayment.

         SECTION 2.6.      PAYMENTS AND COMPUTATIONS. (a) The Borrower shall
make each payment hereunder and under the Note not later than 2:00 P.M. (Puerto
Rico time) on the day when due in United States dollars to the Lender.

                                      -17-

<PAGE>

                  (b) The Borrower hereby authorizes the Lender, if and to the
extent payment owed to the Lender is not made when due hereunder or under the
Note held by the Lender, to charge from time to time any amount so due, first
against Account No. 015012-072 of the Borrower with the Bank, and then, against
any or all of the other Borrower's accounts with the Lender.

                  (c) All computations of interest shall be made by the Lender
on the basis of a year of 360 days, in each case for the actual number of days
(including the first day but excluding the last day) occurring in the period for
which such interest are payable. Each determination by the Lender of an interest
rate hereunder shall be conclusive and binding for all purposes, absent manifest
error.

                  (d) Whenever any payment hereunder or under the Note shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest, provided, however,
that if such extension would cause the next succeeding Business Day to occur in
the next following calendar month, then the day of such payment shall occur on
the next preceding Business Day.

         SECTION 2.7.      VOLUNTARY PREPAYMENTS OF PRINCIPAL. The Borrower may,
upon at least one (1) Business Day prior written notice to the Lender (each a
"Notice of Prepayment"), which notice shall be irrevocable and must be received
not later than 3:00 P.M. (Commonwealth time) at least one (1) Business Day prior
to such prepayment, stating the proposed date and aggregate principal amount of
the prepayment, prepay without penalty or premium from Excess Cash Flow the
outstanding principal amount of the Loan in whole or ratably in part with
accrued interest to the date of such prepayment on the amount prepaid; provided,
that each such partial prepayment shall be in an aggregate principal amount of
not less than $250,000 and in integral multiples of $50,000. Each such
prepayment shall be applied to the principal outstanding on the Loan, in the
inverse order of maturity.

         SECTION 2.8.      WAIVER OF COLLECTION OF INTEREST. Anything herein to
the contrary notwithstanding, the Obligations of the

                                      -18-

<PAGE>

Borrower under this Agreement, the Note and/or the other Loan Documents shall be
subject to the limitation that payments of interest or other amounts shall not
be required to the extent that receipt of any such payment by the Lender would
be contrary to provisions of law applicable to the Lender limiting the maximum
rate of interest or other amounts which may be charged or collected by the
Lender.

                                    ARTICLE 3
                              CONDITIONS OF LENDING

         SECTION 3.1.      CONDITIONS PRECEDENT TO THE LOAN. The obligation of
the Lender to make the Loan is subject to the following conditions precedent:

                  (a) There shall have occurred no Material Adverse Change since
December 31, 1998.

                  (b) There shall exist no action, suit, investigation,
litigation or proceeding affecting the Borrower and/or any of its Subsidiaries
or, to the knowledge of the Borrower, threatened before any court, governmental
agency or arbitrator that (i) is reasonably likely to have a Material Adverse
Effect or (ii) purports to affect the legality, validity or enforceability of
this Agreement, the Note, any other Loan Document or the consummation of the
transactions contemplated hereby or thereby.

                  (c) The Lender shall have received on the Closing Date, each
dated such day (unless otherwise specified), in form and substance satisfactory
to the Lender (unless otherwise specified) and (except for the Note) in
sufficient copies for the Lender:

                           (i) The Note of the Borrower to the order of the
Lender;
                           (ii) This Agreement;
                           (iii) The Collateral Documents: and
                           (iv) The Title Insurance Policy.

The Lender shall have received such evidence as the Lender may deem satisfactory
that all necessary filing fees, and all taxes and other expenses related to such
documents and filings, have

                                      -19-

<PAGE>

been paid in full, or such amounts have been delivered to the Lender.

                  (d) The Lender shall have received certified copies of all
corporate action taken by the Borrower approving each Loan Document to which it
is a party, and of all documents evidencing all other necessary corporate
action and Governmental Approvals, if any, with respect to each such Loan
Document.

                  (e) The Lender shall have received a certificate of the
Secretary or Assistant Secretary of the Borrower certifying the names and true
signatures of the officers of the Borrower authorized to sign each Loan Document
to which it is a party and the other documents to be delivered by it hereunder.

                  (f) The Lender shall have received certificates of good
standing acceptable to the Lender showing that the Borrower is in good standing
in the Commonwealth of Puerto Rico and a copy certified by the Secretary or the
Assistant Secretary of the Borrower dated not more than thirty (30) days prior
to the date of execution of this Agreement of the Articles of Incorporation and
By-Laws of the Borrower.

                  (g) A certificate of the Borrower, signed on behalf of the
Borrower by an authorized officer of the Borrower, dated the Closing Date,
certifying as to (A) the truth of the representations and warranties contained
in the Loan Documents as though made on and as of the date of the Closing Date,
and (B) the absence of any event occurring and continuing, or resulting from the
Loan, that constitutes a Default.

                  (h) Such financial, business and other information regarding
the Borrower as the Lender shall have requested, including, without limitation,
information as to possible contingent liabilities, tax matters, environmental
matters, obligations under ERISA and welfare plans, collective bargaining
agreements and other arrangements with employees, annual financial statements
for the Borrower dated as of December 31, 1998, and interim financial statements
for the Borrower dated the end of the most recent fiscal quarter for which
financial statements are available.

                                      -20-

<PAGE>

                  (i) Payment by the Borrower to the Lender of all reasonable
costs and expenses of the Lender (including, without limitation, attorney's
fees) incurred in connection with the preparation, negotiation, execution and
delivery of this Agreement and the other Loan Documents and the consummation of
the transactions contemplated hereby and thereby.

                  (j) The representations and warranties contained in each Loan
Document are true and correct in all material respects on and as of the date of
the Loan before and after giving effect to the Loan and to the application of
the proceeds therefrom.

                  (k) No event has occurred and is continuing, or would result
from the Loan, or from the application of the proceeds therefrom, which
constitutes a Default.

                  (1) The Lender shall have received copies of all consents,
licenses, approvals and Governmental Permits, if any, obtained by the Borrower
in connection with the execution, delivery, performance, validity and
enforceability of the Loan Documents and the use, occupancy and operation of the
Property, and all such consents, licenses, approvals and Governmental Permits
shall be in full force and effect.

                  (m) The Borrower shall have delivered to the Lender
certificates of insurance or the insurance policies required hereunder and/or
under the Collateral Documents.

                  (n) The Lender shall have received an appraisal report of the
Property prepared by a licensed appraiser acceptable to the Lender and in form
and substance and showing a value acceptable to the Lender.

                  (o) The Lender shall have received copies of all Lease
Agreements and a schedule summarizing the terms and conditions thereof, and they
shall be acceptable to the Lender.

                  (p) There shall be no eminent domain or similar proceedings
pending or affecting the Property.

                  (q) The Lender shall have received satisfactory evidence that
all taxes and levies imposed upon the Property are fully paid and current.

                                      -21-

<PAGE>

                  (r) The Lender shall have received such other approvals,
consents, waivers, opinions or documents as the Lender may reasonably request.

                                    ARTICLE 4
                         REPRESENTATIONS AND WARRANTIES

         SECTION 4.1.      REPRESENTATIONS AND WARRANTIES OF THE BORROWER. In
order to induce the Lender to make the Loan, the Borrower makes the following
representations and warranties to the Lender, each and all of which shall
survive the execution and delivery of this Agreement:

                  (a) The Borrower is a corporation duly organized and validly
existing in the Commonwealth of Puerto Rico and the Borrower does not conduct
business in any other jurisdiction where the nature of its business or assets
requires it to be so qualified to do business, except where the failure to so
qualify would not have a Material Adverse Effect on the business or the assets
of the Borrower. The Borrower has all requisite corporate power and authority to
conduct its business, to own its property and to execute, deliver and perform
all of its obligations under this Agreement, the Note and each of the other Loan
Documents to which it is or will be a party.

                  (b) The execution, delivery and Performance by the Borrower of
the Loan Documents to which it is or will be a party, have been duly authorized
by all necessary corporate action of the Borrower and do not and will not (A)
contravene the organization documents and/or by-laws of the Borrower, (B)
violate in any material respect any provision of any applicable law, rule,
regulation, order, writ, judgment, injunction, decree, determination or award,
(C) constitute or result in a material breach of or constitute a material
default under any indenture or loan or credit agreement or any other agreement,
lease or instrument to which the Borrower and/or any its Subsidiaries is a party
or by which its properties may be bound or affected, or (D) result in, or
require, the creation or imposition of any mortgage, deed of trust, pledge,
Lien, security

                                      -22-

<PAGE>

interest or other charge or encumbrance of any nature (other than as required
hereunder) upon or with respect to any of the properties now owned or hereafter
acquired by the Borrower and/or its Subsidiaries. Neither the Borrower nor its
Subsidiaries is in default under any such law, rule, regulation, order, writ;
judgment, injunction, decree, determination or award, or in breach of any such
indenture, agreement, lease or instrument, the violation or breach of which is
reasonably likely to have a Material Adverse Effect.

                  (c) No authorization or approval or other action by, and no
notice to or filing with, any Governmental Authority or regulatory body is
required for the due execution, delivery and performance by the Borrower of the
Loan Document to which it is or will be a party, or for the consummation of the
transactions contemplated hereby or thereby. The Borrower has all material
licenses, permits, rights, variances and other Governmental Approvals that are
necessary to perform its various obligations under the Loan Documents, to own
and operate its properties and assets and to conduct its business as currently
conducted.

                  (d) This Agreement is, and each other Loan Document to which
the Borrower is or will be a party when delivered hereunder will be, legal,
valid and binding obligations of the Borrower enforceable against the Borrower
in accordance with their respective terms, except to the extent enforceability
thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditor's rights generally and by
equitable principles (regardless of whether enforcement is sought in equity or
at law).

                  (e) The consolidated balance sheet of the Borrower and its
Subsidiaries as of December 31, 1998 and the related consolidated statements of
income and retained earnings of the Borrower and its Subsidiaries for the period
ended on December 31, 1998, copies of which have been furnished to the Lender,
fairly present the financial condition of the Borrower and its Subsidiaries on a
consolidated basis as of such date and the results of the operations of the
Borrower and its Subsidiaries on a consolidated basis for the period ended on
such date, all in

                                      -23-

<PAGE>

accordance with Generally Accepted Accounting Principles consistently applied,
and since such date, there has been no Material Adverse Change in such condition
or operations.

                  (f) Except as otherwise disclosed in the audited financial
statements referred to in sub-section (e) of this Section 4.1, there is no
pending or, to the best of the Borrower's knowledge, threatened action or
proceeding affecting the Borrower and/or its Subsidiaries before any court,
governmental agency or arbitrator which, (i) if adversely determined, is
reasonably likely to have a Material Adverse Effect or (ii) purports to affect
the legality, validity or enforceability of this Agreement, the Note or any
other Loan Document or the consummation of the transactions contemplated hereby
or thereby.

                  (g) The Borrower and its other Subsidiaries are not engaged in
the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the Board of
Governors of the Federal Reserve System), and no proceeds of the Advances will
be used by the Borrower to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock.

                  (h) After giving effect to the transactions contemplated by
the Loan Documents and the payment of all estimated legal, accounting and other
fees related hereto and thereto, the Borrower will be Solvent as of and on the
Closing Date.

                  (i) The Borrower and its Subsidiaries have filed all federal,
state, Commonwealth, and local tax returns required to be filed and have paid
all taxes shown thereon to be due, including interest and penalties, or have
provided adequate reserves therefor; no unpaid or uncontested assessments have
been made against the Borrower and its Subsidiaries by any taxing authority, nor
has any penalty or deficiency been assessed by any such authority, which in the
aggregate for all such assessments, penalties and deficiencies may have a
Material Adverse Effect. All contested assessments which may have a Material
Adverse Effect have been disclosed to the Lender and adequate reserves

                                      -24-

<PAGE>

have been made therefor. Such tax returns properly reflect the income and taxes
of the Borrower and its Subsidiaries for the periods covered thereby, subject
only to reasonable adjustments required by the corresponding taxing authorities
upon audit and having no Material Adverse Effect on the financial condition,
business or results of operations of the Borrower.

                  (j) No Reportable Event has occurred with respect to any Plan
of the Borrower and its Subsidiaries, and neither the Borrower nor its
Subsidiaries has any current or past service liability under any Plan.

                  (k) No Termination Event has occurred or is reasonably
expected to occur with respect to any Plan of the Borrower and/or its
Subsidiaries and neither the Borrower nor its Subsidiaries has any current or
past service liability under any Plan.

                  (1) Neither the Borrower nor its Subsidiaries has incurred any
actual withdrawal liability under ERISA with respect to any Plan.

                  (m) There are no strike's or, to the best of the Borrower's
knowledge, other labor disputes or grievances against the Borrower pending or
threatened which could have a Material Adverse Effect. There are no unfair.
labor practice charges, representation petitions, or grievances pending or in
process or, to the best knowledge of the Borrower, threatened by or on behalf
of any employee or group of employees of the Borrower which could have a
Material Adverse Effect. There are no written complaints, received by the
Borrower or, to the best knowledge of the Borrower, threatened, or with respect
to unresolved complaints on file, with any federal, state, Commonwealth or local
court or government agency alleging employment discrimination, wrongful
discharge, or other unlawful employment practice by the Borrower.

                  (n) No written information, exhibit or report furnished by the
Borrower to the Lender in connection with the negotiation of this Agreement,
taken together, contained any material misstatement of fact or omitted to state
a material fact or any fact necessary to make the statements contained therein

                                      -25-

<PAGE>

not misleading in light of the circumstances in which they were given.

                  (o)      (i) The operations and properties of the Borrower and
its Subsidiaries comply in all material respects with all applicable
Environmental Laws; (ii) all necessary Environmental Permits have been obtained
and are in effect for the operations and properties of the Borrower and its
Subsidiaries and the Borrower and its Subsidiaries are in compliance in all
material respects with all such Environmental Permits; (iii) none of the
operations or properties of the Borrower and/or its Subsidiaries is subject to
any Environmental Action alleging the violation of any Environmental Law; (iv)
no circumstances known to the Borrower exist that could form the basis of an
Environmental Action against the Borrower and/or its Subsidiaries or any of
their properties that could have a Material Adverse Effect or cause any such
property to be subject to any restrictions which could have a Material Adverse
Effect on ownership, occupancy, use or transferability under any Environmental
Law; (v) none of the operations of the Borrower and/or its Subsidiaries are the
subject of a federal, state, Commonwealth or local investigation evaluating
whether any remedial action is needed to respond to a Release or Threat of
Release of any Hazardous Material or any other substance into the Environment,
which remedial action may have a Material Adverse Effect on the Borrower's
and/or its Subsidiaries' business operations, financial condition or the value
of any Collateral; and (vi) the Borrower and its Subsidiaries do not have any
contingent liability in connection with any Release or Threat of Release of any
Hazardous Material or any other substance into the Environment which contingent
liability, if liquidated, would not be adequately covered (in the reasonable
determination of the Lender) by insurance or other indemnification rights and
which, in the reasonable determination of the Lender, would not have a Material
Adverse Effect on the Borrower's and/or its Subsidiaries' business operations or
financial condition. The Borrower and its Subsidiaries have not filed any notice
under any Environmental Law indicating past or present treatment, storage or
disposal of a Hazardous Material or

                                      -26-

<PAGE>

reporting a Release or Threat of Release of a Hazardous Material or any other
hazardous substance into the Environment.

                  (p) Neither the Borrower nor its other Subsidiaries, is an
"investment company", or an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended. Neither the making of the Loan, nor
the application of the proceeds or repayment thereof by the Borrower, nor the
consummation of the other transactions contemplated hereby, will violate any
provision of the Investment Company Act of 1940, as amended, or any rule,
regulation or order of the Securities and Exchange Commission thereunder.

                  (q) Set forth in the Financial Statements most recently
submitted to the Lender is a complete and accurate list of all Debt showing as
of the date set forth thereon the principal amount outstanding thereunder (the
"Existing Debt").

                  (r) Neither the Borrower nor its Subsidiaries is a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended.

                  (s) The Borrower has good and marketable title to all assets
and properties shown or reported in the Financial Statements most recently
submitted to the Lender and all such assets and properties are free and clear of
any encumbrances, mortgages, pledges, charges, leases, security interest and any
other type of lien, encumbrance and/or title restriction, except those reflected
in the Financial Statements.

                  (t) The Borrower and its Subsidiaries hold all franchises and
licenses required for their operations and said licenses and franchises are in
full force and effect and no other approval, application, filing, registration,
consent or other action of any local, state or federal authority is, or will be
required to enable the Borrower and its Subsidiaries to exploit any such
franchise and licenses. The Borrower nor its Subsidiaries have received any
notice from the granting body or any other Governmental Authority with respect
to any breach of

                                      -27-

<PAGE>

any covenant under, or any default with respect to, any such franchises or
licenses. Before and upon giving effect to this Agreement and the Loan Documents
no default shall have occurred and be continuing under any such franchises and
licenses. All material consents and approvals of, filings and registration with
and all other actions in respect of, all Governmental Authorities or
instrumentalities required to maintain any franchises and licenses in full force
and effect prior to the scheduled date of expiration thereof have been, or,
prior to the time when required, will have been, obtained, given, filed or taken
or will be in full force and effect.

                  (u) All policies of insurance of any kind or nature owned by
or issued to the Borrower, including, without limitation, policies of life,
fire, theft, product liability, public liability, property damage, other
casualty, employee fidelity, worker's compensation, employee health and welfare,
title, property and liability insurance, are in full force and effect and are of
a nature and provide such coverage as is sufficient and as is customarily
carried by companies of the size and character of the Borrower. The Borrower has
not been refused insurance for which it applied or had any policy of insurance
terminated (other than at its request).

                  (v) The proceeds of the Loan shall be used and applied only
for the purposes set forth in Section 2.1 hereof.

                  (w) The Borrower represents and warrants to the Lender that:
(i) in the normal course of the operation of its business it uses computer
hardware and software for the storage and processing of data (collectively the
"Borrower's Computer Systems") including financial information, inventory,
client lists and other data which is of critical importance to the operation of
its business; (ii) as of the date hereof the Borrower's Computer Systems are in
adequate condition for the purposes for which they are used and intended; (iii)
it is distinctly aware of the existence of the so called year 2000 problem in
the computer field (the "Year 2000 Problem"), which consists generally of the
fact that present programming of the vast majority of computer software and
hardware does not provide

                                      -28-

<PAGE>

for the recognition of dates after December 31, 1999, and that accordingly, upon
the advent of the Year 2000 it is expected that hardware and software which has
not been reprogrammed or replaced, as conditions may require, will cease to
operate or will otherwise operate erratically, all of which would cause a
significant loss of data and other efficiencies to the Borrower's business,
including potentially material financial losses: (iv) the Borrower believes that
it is taking, or has taken, any and all necessary steps to assure that its
significant clients, material suppliers, and any other Person which individually
or in the aggregate has or could have a Material Adverse Effect on the
operations, financial or otherwise of the Borrower's business including, without
limitation, technology, telecommunications, software and hardware providers, are
able to meet the requirements of the Year 2000 Problem, and (v) as of the date
hereof, the Borrower reasonably believes that it has substantially completed or
will be in a position to substantially complete on or before October 31, 1999
all required modifications, conversions, changes or replacements to the
Borrower's Computer Systems so that the Year 2000 Problem shall not materially
adversely affect the Borrower's business.

                  (x)      (i) There are no material structural or material
defects of any kind in the Property or violations of any requirement of
Governmental Authorities with respect thereto.

                           (ii) The Property complies with all applicable zoning
and construction ordinances, regulations and restrictive covenants applicable
thereto, as well as all ecological and other laws and regulations. The Property
has in full force and effect all required Governmental Approvals. There are no
presently outstanding notices of violations of Governmental Approvals related to
the Property.

                           (iii) The Property has not been materially damaged by
fire or other casualty and is in good rentable condition.

                           (iv) All utility services necessary for its proper
and efficient operation are available at the Property.

                           (v) The Borrower has obtained all required
Governmental Approvals necessary for the present uses, occupancy

                                      -29-

<PAGE>

and operation of the Property, and they are in full force and effect.

                           (vi) The Lease Agreements identified in Exhibit 1 of
the Assignment of Lease Agreements affecting all or any portion of the Property
are in full force and effect and constitute the legal, valid and binding
obligations of the Borrower and/or its Subsidiary, as the case may be,
enforceable against such parties in accordance with their terms.

                           (vii) There are no underground storage tanks on, in,
under or affecting all or any portion of the Property.

                  (z)      (i) The provisions of each Mortgage are effective to
create in favor of the bearer of the Mortgage Note secured thereby, a legal,
valid and enforceable first lien and security interest in all right, title and
interest of such bearer in the Property described therein; and each Mortgage,
when filed in the corresponding Section of the Property Registry of the
Commonwealth, will be recorded and upon recordation will constitute a fully
perfected first lien on and security interest in all right, title and interest
of the Borrower in such Property superior in right to any Liens, existing or
future, which any Person may have against such Property or interest therein.

                           (ii) The Mortgage Notes Pledge and Security Agreement
creates in favor of the Lender a legal, valid and enforceable first priority
lien and security interest in all right, title and interest of the Borrower in
the Mortgage Notes, and upon delivery to, and continued possession by, the
Lender of such Mortgage Notes, the Mortgage Notes Pledge and Security Agreement
shall constitute a fully perfected first priority lien on and security interest
in all right, title and interest of the Borrower in such Mortgage Notes superior
in right to any Liens, existing or future, which any Person may have against
such Mortgage Notes or interest therein.

                           (iii) The Assignment of Lease Agreements constitutes
in favor of the Lender a legal, valid and enforceable first priority assignment
in all right, title and interest of the Borrower in the Lease Agreements
described therein superior in

                                      -30-

<PAGE>

right to any Liens, existing or future, which any Person may have against such
Lease Agreements or interest therein.

                                    ARTICLE 5
                            COVENANTS OF THE BORROWER

         SECTION 5.1.      AFFIRMATIVE COVENANTS. So long as the Loan shall
remain unpaid and until satisfaction of all other Obligations of the Borrower
hereunder, the Borrower will:

                  (a) Comply and cause its Subsidiaries to comply, in all
material respects, with all applicable laws, rules, regulations and orders
except where such non-compliance is not reasonably likely to have a Material
Adverse Effect.

                  (b)      (i) Maintain and cause its Subsidiaries to maintain
all of its properties (real and personal) insured at all times by responsible,
reputable and financially sound insurance companies or associations in such
amounts and covering loss or damage by fire, earthquake and windstorm and such
other risks as are usually carried by companies engaged in similar businesses
and owning similar properties as the Borrower or as may be required by the
Lender (including an all risk hazard insurance policy with extended coverage
endorsement for 100% of the estimated replacement cost of the Property, but in
no event for less than the principal outstanding under the Loan, and business
interruption and use and occupancy coverage), and (ii) maintain adequate
insurance for damage to property, death or bodily injury and other insurance
against liability to persons for such risks and hazards and in such amounts as
are usually carried by companies engaged in similar businesses (including a
comprehensive general liability policy). All such insurance shall include the
Lender as the only mortgagee and shall require a 30 day prior written notice to
the Lender prior to cancellation. The Borrower shall promptly furnish or cause
to be furnished to the Lender in form and substance acceptable to the Lender
evidence of such insurance, including originals or copies as the Bank may
request of policies, certificates of insurance, riders, endorsements and proof
of premium payments.

                                      -31-
<PAGE>

                  (c)      Furnish to the Lender:

                           (i)      as soon as available and in any event within
30 days after the close of each of the first three quarters of the Borrower's
Fiscal Year and within 60 days after the end of the last fiscal quarter of each
Fiscal Year of the Borrower; quarterly unaudited financial statements of the
Borrower and its Subsidiaries on a consolidated basis, including balance
sheets, income statements and cash flow statements, prepared according to
Generally Accepted Accounting Principles. The financial statements referred to
above shall be accompanied by a certificate signed by the Chief Financial
Officer or Treasurer of the Borrower identifying any Event of Default hereunder
and/or any existing fact or circumstance which, with the lapse of time or the
giving of notice or both, would result in an Event of Default hereunder, and
certifying that no other default has occurred under this Agreement, and that no
other fact or circumstance exists which, with the lapse of time or the giving of
notice or both, would result in an Event of Default hereunder;

                           (ii)     as soon as available and in any event within
120 days after the close of each Fiscal Year of the Borrower, audited financial
statements of the Borrower and its Subsidiaries on a consolidated basis,
including balance sheets, income statements and cash flow statements, prepared
according to Generally Accepted Accounting Principles, as of the end of such
year, certified by independent certified public accountants of recognized
national standing satisfactory to the Lender;

                           (iii)    promptly, but in any event within ten (10)
Business Days after the Borrower knows or has reason to know of the existence of
a Default, a statement of the Chief Financial Officer or Treasurer of the
Borrower setting forth details of such Default and the action which the Borrower
has taken or will take with respect thereto;

                           (iv)     promptly, but in any event within ten (10)
Business Days after receipt by the Borrower of service of process or other
notice of commencement thereof, notice of all actions, suits, investigations,
litigation and proceedings before any court or governmental department,
commission, board, bureau,

                                      -32-
<PAGE>

agency or instrumentality, domestic or foreign, which requests a monetary
judgment not covered by insurance against, or other type of monetary relief not
covered by insurance from, the Borrower which could result in a Material Adverse
Effect, and promptly after the occurrence thereof notice of any material adverse
change in the status or the financial effect on the Borrower of such actions,
suits, investigations, litigation and proceedings;

                           (v)      promptly, but in any event within ten (10)
Business Days after receipt thereof, copies of the following: (i) any notice of
tax deficiency received from the Puerto Rico Treasury Department or any other
taxing authority of the Commonwealth, (ii) any notice of municipal license tax
deficiency received from the Finance Director of any of the municipalities of
the Commonwealth and (iii) any notice of property tax deficiency received from
the Municipal Revenue Collections Center of Puerto Rico; provided that this
subsection (v) shall only apply to deficiencies which could result in a Material
Adverse Effect;

                           (vi)     promptly, but in any event within ten (10)
Business Days after the Borrower knows or has reason to know of the existence
thereof, notice of any condition or occurrence on any property of the Borrower
and/or its Subsidiaries that results in noncompliance with, or liability under,
any Environmental Law or Environmental Permit with respect to the Borrower
and/or its Subsidiaries and which noncompliance or liability could result in a
Material Adverse Effect;

                           (vii)    promptly, but in any event within ten (10)
Business Days after the Borrower knows or has reason to know of the existence
thereof, notice of any material labor dispute to which the Borrower and/or its
Subsidiaries may become a party, any strikes or walkouts relating to any of its
or their facilities;

                           (viii)   promptly, but in any event within ten (10)
Business Days after the occurrence thereof, notice of the default by the
Borrower and/or its Subsidiaries under any note, indenture, loan agreement,
mortgage, lease, deed or other similar agreement which could result in a
Material Adverse Effect.

                                      -33-
<PAGE>

                  (d)      Obtain, preserve and maintain (i) its corporate
existence and going concern status, and (ii) all rights (charter and statutory)
and all approvals, authorizations, licenses, permits and franchises of all
Governmental Authorities necessary to enable the Borrower to operate and
maintain its property, business and operations as currently conducted other than
such rights, approvals, authorizations, licenses, permits and franchises which
failure to obtain, preserve or maintain could not reasonably be expected to have
a Material Adverse Effect.

                  (e)      Keep proper books of record and account and cause its
Subsidiaries to keep proper books of record and account, in which full and
correct entries shall be made of all financial transactions and the assets and
businesses of the Borrower in accordance with Generally Accepted Accounting
Principles consistently applied. The Borrower shall permit authorized
representatives of the Lender to visit and inspect its properties and assets, to
inspect its books of records and account and make photocopies thereof, to review
its accounts and to discuss the affairs, finances and accounts of the Borrower
with its authorized Person all at such times during normal business hours, as
often as the Lender may reasonably request and upon two (2) Business Day prior
notice. The books and records of the Borrower shall be kept at its principal
office place of business in the Commonwealth and shall not be removed form such
location without the prior consent of the Lender.

                  (f)      Maintain and preserve all of its properties which are
necessary or reasonably useful for the proper conduct of its businesses in good
working order and condition, ordinary wear and tear excepted, and in material
compliance with all applicable standards and rules imposed by all Governmental
Authorities with jurisdiction, except where the failure to do so is not,
individually or in the aggregate, reasonably likely to result in a Material
Adverse Effect; and at all times do or cause to be done all things necessary to
obtain, preserve, renew and keep in full force and effect all copyrights,
trademarks, service marks and trade names, except where the failure to do so is
not, individually or in the aggregate, reasonably likely to result in a Material
Adverse Effect.

                                      -34-
<PAGE>

                  (g)      Utilize the proceeds of the Loan for the purposes set
forth in Section 2.1.

                  (h)      File and cause its Subsidiaries to file all federal,
state, Commonwealth and local tax returns and other reports required by law to
be filed, except if the failure to timely file such returns and reports would
not result in a Material Adverse Effect; maintain and cause its Subsidiaries to
maintain adequate reserves for the payment of all taxes, assessments,
governmental charges and levies imposed upon the Borrower and/or its
Subsidiaries, its income or its profits; pay and discharge all such taxes,
assessments, governmental charges and levies imposed upon the Borrower and its
Subsidiaries or against its properties prior to the date on which penalties
accrue, except to the extent that the same may be contested by the Borrower
and/or its subsidiaries in good faith by appropriate proceedings and adequate
reserves have been made therefor, unless and until a Lien resulting therefrom
attaches to its property and becomes enforceable against its other creditors;
and prior to their becoming overdue, promptly notify the Lender in writing as to
any such taxes, assessments and governmental charges which it intends to
contest.

                  (i)      Continue and cause its Subsidiaries to continue to be
Solvent.

                  (j)      Conduct and cause its Subsidiaries to conduct its
business so as to comply in all material respects with all applicable
Environmental Laws and Environmental Permits; provided, however, that nothing
contained in this subsection shall prohibit the Borrower and/or its Subsidiaries
from contesting, in good faith by appropriate legal proceedings, any such
Environmental Law or Environmental Permit or the interpretation or application
thereof, provided, further, that the Borrower shall and shall cause its
Subsidiaries to comply with the order of any court or other governmental body of
applicable jurisdiction relating to such Environmental Laws and Environmental
Permits unless the Borrower and/or its Subsidiaries shall then be prosecuting an
appeal or proceedings for review and shall have secured a stay of enforcement or
execution or other arrangement postponing enforcement or execution pending such
appeal or proceedings

                                      -35-
<PAGE>

for review. If the Borrower and/or its Subsidiaries shall (i) receive notice
that any violation of any Environmental Law or Environmental Permit may have
been committed or is about to be committed by the Borrower and/or its
Subsidiaries, (ii) receive notice that any Environmental Action has been filed
or is about to be filed against the Borrower and/or its Subsidiaries alleging
violations of any Environmental Law or Environmental Permit or requiring the
Borrower and/or its Subsidiaries to take any action in connection with the
Release of toxic or Hazardous Materials into the Environment, (iii) receive any
notice from a federal, state, Commonwealth or local governmental agency or
private party alleging that the Borrower and/or its Subsidiaries may be liable
or responsible for costs associated with a response to or cleanup of a Release
of a toxic or Hazardous Material into the Environment or any damages caused
thereby, (iv) receive any notice that the Borrower and/or its Subsidiaries is
subject to federal, state, Commonwealth or local investigation evaluating
whether any remedial action is needed to respond to the Release of any Hazardous
Material or any other substance into the Environment, or (v) receive any notice
that any properties or assets of the Borrower and/or its Subsidiaries are
subject to a Lien in favor of any governmental entity for any liability under
Environmental Laws or damages arising from or costs incurred by such
governmental entity in response to a Release of a Hazardous Material or any
other substance into the Environment, then the Borrower shall promptly but in
any event within five (5) Business Days after the Borrower's receipt thereof,
provide the Lender with a copy of such notice.

                  (k)      Conduct all transactions with any of its Affiliates
on terms that are fair and reasonable and no less favorable to the Borrower than
it would obtain in a comparable arm's-length transaction with a Person not an
Affiliate.

                  (1)      Take all necessary and appropriate action and steps
to address and remedy all and any deficiencies in the Borrower's Computer
Systems which relate to the Year 2000 Problem that could be reasonably expected
to adversely affect the operations, financial or otherwise, of the Borrower's
business, including without limitation estimating the cost of making all

                                      -36-
<PAGE>

such modifications to the Borrower's Computer Systems. In this respect, it
agrees further to maintain the Lender at all times reasonably informed of its
progress in making all applicable modifications, conversions, changes or
replacements to the Borrower's Computer Systems (the "Year 2000 Plan") so that
the Year 2000 Problem shall not materially adversely affect the operations,
financial or otherwise, of the Borrower's business.

                  (m)      The Borrower will, promptly upon an authorized Person
of the Borrower obtaining knowledge thereof, give notice and complete
information to the Lender of (i) any material casualty to any property or asset
or any other force majeure, or any litigation, investigation or other proceeding
against or involving the Borrower, the result of any which could be expected to
have a Material Adverse Effect, (ii) any litigation, investigation, other
proceeding or dispute affecting the Borrower (A) which relates, in whole or in
part, to any of the transactions contemplated by any of the Loan Documents or
(B) which is not covered by insurance or (C) which may exist between the
Borrower and any Governmental Authority and which might materially interfere
with the normal business operations of the Borrower or (iii) any termination
and/or any material amendment, modification, substitution of any Lease
Agreement.

                  (n)      The Borrower shall perform within all required time
periods (after giving effect to any applicable grace periods), all of its
obligations and enforce all of its rights under each agreement to which it is a
party, where the failure to so perform and enforce would have a Material Adverse
Effect. The Borrower shall not terminate or modify in any manner adverse to it
and/or the Lender, as reasonably determined by the Lender, any provision of any
Lease Agreement to which it is a party which termination or modification could
have a Material Adverse Effect. The Borrower shall strictly observe and comply
with all of the terms, conditions and covenants contained in the Collateral
Documents.

                  (o)      Promptly, upon request by the Lender, the Borrower
shall correct any defect or error that may be discovered in any Loan Document or
in the execution, acknowledgment or recording thereof. Promptly, upon request by
the Lender, the Borrower shall

                                      -37-
<PAGE>

do, execute, acknowledge, deliver, record, file, register and obtain, any and
all such further acts, conveyances, documents, and other instruments and pay the
appropriate fees therefor as the Lender may require from time to time in order
(i) to carry out more effectively the purposes of this Agreement or any other
Loan Document, (ii) to protect the liens and security interests created by any
of the Collateral Documents on any of the Borrower's properties, rights or
interests covered or now or hereafter intended to be covered by any of the
Collateral Documents, (iii) to perfect and maintain the validity, effectiveness
and priority of any of the Collateral Documents and the liens and security
interests intended to be created thereby, and (iv) to better assure, convey,
grant, assign, transfer, preserve, protect and confer unto the Lender the rights
granted or now or hereafter intended to be granted to the Lender under any Loan
Document or under any other instrument executed in connection with any Loan
Document. The Borrower shall pay all stamp, filing, registry, recording and
similar taxes and fees and stamps in connection with the issuance, delivery or
transfer by the Borrower to the Lender of the Loan Documents, and the execution,
delivery and recording of the Loan Documents and any other agreements and
instruments contemplated thereby, and shall save and hold harmless the Lender
without limitation as to time against any and all liabilities with respect to
such taxes and fees and stamps. The obligations of the Borrower under this
sub-section (o) shall survive the payment, prepayment or redemption of the Note,
and the termination of this Agreement.

                  (p)      Within five (5) Business Days after executing a Lease
Agreement, the Borrower shall deliver to the Lender a true and exact copy of
such Lease Agreement. No later than five (5) Business Days after requested by
the Lender, the Borrower shall execute and deliver to the Lender an Assignment
of lease Agreements covering Lease Agreements executed from time to time after
the Closing Date.

                  (q)      Unless otherwise required by any Governmental
Authority, at any time after the occurrence and continuance of an Event of
Default, the Lender shall have the right to obtain, at the Borrower's cost and
expense, periodic appraisals of the

                                      -38-
<PAGE>

Property. Copies of all such appraisals and any updating thereof will be sent to
Borrower.

                  (r)      The Borrower agrees that it will not exercise any
right which it may have to cancel the record of the Mortgages by reason of lapse
of time counted from the date hereof either under the provisions of Article 145
of the Mortgage Law of Puerto Rico or otherwise and further agrees to execute,
promptly at the request of the Lender, and file in the appropriate Section of
the Registry of Property of Puerto Rico, at the Borrower's cost and expense, on
or before a date which is fifteen (15) years from the date hereof, any and all
supplemental instruments or deeds which may be necessary or convenient for the
preservation of the Lien of the Mortgages until the Obligations so secured by
the Lien of the Mortgage is paid in full, including, without limitation, added
of modification of mortgage by virtue of which the Borrower agrees to further
extend the prescription period for the expiration of the Mortgages. The failure
by the Borrower to fully comply with this sub-section (r) shall constitute an
Event of Default under this Agreement.

         SECTION 5.2.      NEGATIVE COVENANTS. So long as the Loan shall
remain unpaid and until full payment of the Note and all other Obligation of the
Borrower hereunder, the Borrower will not, without the prior written consent of
the Lender:

                  (a)      Declare or pay any dividends, purchase, redeem,
retire, defease or otherwise acquire for value any of its capital stock or any
warrants, rights or options to acquire such capital stock now or hereafter
outstanding, return any capital to its stockholders as such, make any
distribution of assets, capital stock, warrants, rights, options, obligations or
securities to its stockholders as such, or permit any Subsidiary of the Borrower
to purchase, redeem, retire, defease or otherwise acquire for value any capital
stock of the Borrower or of any Subsidiary of the Borrower or any warrants,
rights or options to acquire such capital stock, provided, however, that if no
Default has occurred and is continuing, the Borrower may declare and pay cash
dividends in any Fiscal Year not to exceed its retained earnings for such Fiscal
Year and undistributed retained earnings for prior Fiscal Years.

                                      -39-
<PAGE>

                  (b)      Sell, lease, transfer or otherwise dispose of, the
Property.

                  (c)      Directly or indirectly enter into any transaction of
merger or consolidation; liquidate, windup or dissolve itself (or suffer any
such liquidation or dissolution).

                  (d)      Make any material change in the nature of the
business carried on by the Borrower as of the date hereof, or make any material
change in the Borrower's business objectives, purposes or operations, except if
any such change does not result in a Material Adverse Effect.

                  (e)      Assume, guarantee, endorse or otherwise be or become
liable upon or permit any Subsidiary to assume, guarantee, endorse or otherwise
be or become liable upon, the obligations of any Person, except by the
endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business, in respect to Triple-S, Inc. or
if any such assumption, guarantee, endorsement or liability does not result in a
Material Adverse Effect.

                  (f)      Create or enter into, or permit any of its
Subsidiaries to create or enter into, any Plan except in compliance in all
material respects with all applicable laws and regulations.

                  (g)      Enter into or be a party to, or permit any of its
Subsidiaries to enter into or be a party to, any transaction with any of its
Affiliates, except in the ordinary course of business and pursuant to the
reasonable requirements of the Borrower's or such Subsidiary's business and upon
fair and reasonable terms which are no less favorable to the Borrower or such
Subsidiary than the Borrower or such Subsidiary would obtain in a comparable
arm's length transaction with a Person which is not the Borrower's Affiliate or
if such transaction does not result in, a Material Adverse Effect.

                  (h)      Amend, or permit any Subsidiary to amend, any
provision relating to capital stock or otherwise in any way adverse in any
material respect to the interest of the Lender, the Articles of Incorporation or
By-Laws of the Borrower or such Subsidiary, except to the extent required in
order to comply with applicable law or if any such amendment does not result in
a

                                      -40-
<PAGE>

 Material Adverse Effect. In any event, the Borrower shall give the Lender not
 less than thirty (30) days written notice after amending the Articles of
 Incorporation or By-Laws of the Borrower or any of its Subsidiaries.

                  (i)      Directly or indirectly make or permit, any change in
accounting policies or reporting practices including, without limitation, any
change in its Fiscal Year or fiscal periods, except as required by or advisable
under Generally Accepted Accounting Principles.

                  (j)      Surrender, terminate, cancel, modify, change,
supplement, alter, amend or violate the Lease Agreements, or cause or permit
such acts if any of the foregoing causes a Material Adverse Effect.

                                    ARTICLE 6
                                EVENTS OF DEFAULT

         SECTION 6.1.      EVENTS OF DEFAULT. If any of the following events
("Events of Default") shall occur and be continuing:

                  (a)      The Borrower shall fail to pay when due any amount of
principal and/or interest or the Borrower shall fail to pay any other amounts or
fees thirty (30) days after the same become due; or

                  (b)      The Borrower shall fail to perform or observe any
term, covenant or agreement contained in Sections 5.1 (a), (c), (g), (h), (i),
(j), (k), (p) or (q) or Section 5.2; or

                  (c)      The Borrower shall fail to perform or observe any
other term, covenant or agreement contained in this Agreement and/or in any
other Loan Document on its part to be performed or observed, and in any such
case any such failure shall remain unremedied for a period of thirty (30) days
after written notice thereof shall have been given to the Borrower by the
Lender; or

                  (d)      Any representation or warranty made by the Borrower
(or any of its officers) under or in connection with any Loan Document to which
it is a party shall, when taken as a whole, prove to have been incorrect in any
material respect when made; or

                                      -41-
<PAGE>

                  (e)      The Borrower or any Subsidiary thereof shall fail to
pay any principal of, premium or interest on any Debt that is outstanding in a
principal amount of $1,000,000 or more in the aggregate (excluding Debt
evidenced by the Note) (as the case may be), thirty (30) days after the same
became due and owing (whether at scheduled maturity, by required prepayment,
acceleration, demand or otherwise) or any other default under any agreement or
instrument relating to any such Debt, or any other event, shall occur, if the
effect of such default or event is to accelerate, or to permit the acceleration
of, or to permit the acceleration after the giving of notice or passage of time
or both, of, the maturity of such Debt; or any such Debt shall be declared to
be due and payable, or required to be prepaid (other than by a regularly
scheduled required prepayment), prior to the stated maturity thereof; or

                  (f)      The Borrower or any of its Subsidiaries shall
generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general assignment for
the benefit of all its creditors; or any proceeding shall be instituted by or
against the Borrower or any of its Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of any order for relief or the appointment of a
receiver, trustee, or other similar official for it or for any substantial part
of its property and, in the case of any such proceeding instituted against it
(but not instituted by it) that is being diligently contested by it in good
faith, either such proceeding shall remain undismissed or unstayed for a period
of sixty (60) days or any of the actions sought in such proceeding (including,
without limitation, the entry of any order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official for, it
or any substantial part of its property) shall occur; or the Borrower or any of
its Subsidiaries shall take any corporate action to authorize any of the actions
set forth above in this subsection (f); or

                                      -42-
<PAGE>

                  (g)      Any Reportable Event which the Lender believes might
constitute grounds for termination of any Plan maintained by the Borrower or any
of its Subsidiaries shall have occurred or if a United States District Court
appoints a trustee to administer any such Plan, or if the PBGC shall institute
proceedings to terminate any such Plan or to appoint a trustee therefor; or if
any Termination Event with respect to a Plan shall have occurred, and sixty (60)
days thereafter, (i) such Termination Event (if correctable) shall not have been
corrected and (ii) the then present value of such Plan's vested benefits exceeds
the then current value of assets accumulated IN SUCH Plan; or if the Borrower or
any of its Subsidiaries as employer under a Plan shall have made a complete or
partial withdrawal from such Plan and the Plan sponsor of such Plan shall have
notified such withdrawing employer that such employer has incurred an actual
withdrawal liability which materially adversely affects the financial condition
of the Borrower: or

                  (h)      Any final and unappealable judgment or order for the
payment of money in excess of $1,000,000 which is not covered by insurance shall
be rendered against the Borrower or any of its Subsidiaries and either (i)
enforcement proceedings shall have been commenced by any creditor upon such
judgment or order or (ii) there shall be any period of thirty (30) consecutive
days during which a stay of enforcement of such judgment or order, by reason of
a pending appeal or otherwise, shall not be in effect: or

                  (i)      Any material provision of any Loan Document after
delivery thereof pursuant to this Agreement shall for any reason (other than
pursuant to the terms hereof or thereof) cease to be valid and binding on or
enforceable against any party to it (other than the Lender), or any such party
shall so state in writing; or

                  (j)      There shall have occurred a condition or a change of
circumstances which, taken as a whole, has or could reasonably be expected to
have a Material Adverse Effect on the assets, properties, operations or
financial condition of the Borrower and/or its Subsidiaries taken as a whole;

                                      -43-
<PAGE>

then, and in any such event, the Lender may by notice to the Borrower, declare
the Note, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Note, all such interest
and all such amounts shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Borrower; provided, however, that in the event of
an actual or deemed entry of an order for relief with respect to the Borrower
under the Federal Bankruptcy Code, the obligation of the lender to make any loan
shall automatically be terminated and the Note, all such interest and all such
amounts shall automatically become and be due and payable, without presentment,
demand, protest or any notice of any kind, all of which are hereby expressly
waived by the Borrower.

                                    ARTICLE 7
                                  MISCELLANEOUS

         SECTION 7.1.      AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement, the Note or any other Loan Documents, nor consent
to any departure by the Borrower therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Lender (and, in the case
of any such amendment, by the Borrower), and then such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given.

         SECTION 7.2.      NOTICES, ETC. All notices and other communications
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telecopied, telegraphed, telexed,
cabled or delivered personally or by courier, if to the Borrower, at 1441
Roosevelt Avenue, Puerto Nuevo, San Juan, Puerto Rico, Attention: President
(Facsimile Number: 787-749-4191; and if to the Lender, at 1519 Ponce de Leon
Avenue, 15th Floor, Santurce, Puerto Rico 00911, Attention: President (Facsimile
No. 787-787-1245): or as to each party, at such other address as shall be
designated by such party in a written notice to the other parties. All such
notices and communications shall, when mailed, telecopied, telegraphed,

                                      -44-
<PAGE>

telexed or cabled, be effective three (3) days after being deposited in the
mails, on the day when transmitted by telecopier, on the day when delivered to
the telegraph company, on the day when confirmed by telex answerback or on the
day when delivered to the cable company, respectively, and when delivered
personally or by courier, on the day when delivery is made. Notwithstanding the
foregoing, notices and communications to the Lender pursuant to Article 2 shall
not be effective until received by the Lender.

         SECTION 7.3.      NO WAIVER; REMEDIES. No failure on the part of the
Lender to exercise, and no delay in exercising, any right hereunder or under the
Note shall operate as a waiver thereof; nor shall any single or partial exercise
of any such right preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.

         SECTION 7.4.      COSTS, EXPENSES AND TAXES; INDEMNIFICATION. (a) The
Borrower agrees to pay on demand all reasonable costs and expenses of the Lender
in connection with the preparation, execution, delivery, administration,
modification and amendment of this Agreement, the Note, the Loan Documents and
the other documents to be delivered hereunder and under the other Loan
Documents. The Borrower further agrees to pay on demand all reasonable costs and
expenses, if any (including, without limitation, reasonable counsel fees and
expenses), in connection with the enforcement (whether through negotiations,
legal proceedings or otherwise) after the occurrence of an Event of Default of
this Agreement, the Note, the Loan Documents and the other documents to be
delivered hereunder, including, without limitation, reasonable counsel fees and
expenses in connection with the enforcement of rights under this Section 7.4(a).

                  (b)      The Borrower hereby agrees to indemnify and hold
harmless the Lender and each of its Affiliates and its officers, directors,
employees, agents, advisors and representatives (each, an "Indemnified Party")
from and against ANY AND ALL CLAIMS, damages, losses, liabilities and expenses
(including, without limitation, the reasonable fees and expenses of counsel),
joint or several, that may be incurred by or asserted or awarded

                                      -45-
<PAGE>

against any Indemnified Party, in each case arising out of or in connection with
or by reason of, or in connection with the preparation for a defense of, any
investigation, litigation or proceeding arising out of, related to or in
connection with (i) the transactions contemplated by this Agreement and the
other Loan Documents or any use made or proposed to be made with the proceeds of
the Advance or (ii) the actual or alleged presence of hazardous materials on any
property of the Borrower or any Environmental Action relating in any way to the
Borrower in each case whether or not such investigation, litigation or
proceeding is brought by the Borrower, its partners, directors, shareholders or
creditors or an Indemnified Party or any Indemnified Party is otherwise a party
thereto and whether or not the transactions contemplated hereby are consummated,
except to the extent such claim, damage, loss, liability or expense is found in
a final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct.
The Borrower further agrees that no Indemnified Party shall have any liability
(whether direct or indirect, in contract or tort or otherwise) to the Borrower
or its creditors for or in connection with the transactions contemplated by this
Agreement and the other Loan Documents, except to the extent that such liability
is found in a final nonappealable judgment by a court of competent jurisdiction
to have resulted from such Indemnified Party's gross negligence or willful
misconduct; provided, however, that the provisions of this Section shall not in
any way alter any contractual obligation or contractual remedy of any
Indemnified Party. The Borrower also agrees not to assert any claim against the
Lender, any of its Affiliates, or any of its respective directors, officers,
employees, attorneys and agents, on any theory of liability, for special,
indirect, consequential or punitive damages arising 'out of or otherwise
relating to any of the transactions contemplated herein or in any other Loan
Document or the actual or proposed use of the proceeds of the Advances.

                  (c)      If the Borrower fails to pay when due any reasonable
costs, expenses or other amounts payable by it under any Loan Document,
including, without limitation, fees and

                                      -46-
<PAGE>

expenses of counsel and indemnities, such amount may be paid on behalf of the
Borrower by the Lender in its sole discretion.

         SECTION 7.5.      RIGHT OF SET-OFF. Upon the occurrence and during the
continuance of any Event of Default the 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 the Lender
to or for the credit or the account of the Borrower against any and all of the
Obligations of the Borrower now or hereafter existing under this Agreement, the
Note held by the Lender and the other Loan Documents, whether or not the Lender
shall have made any demand under this Agreement, the Note, such other Loan
Documents and although such Obligations may be unmatured. The Lender agrees
promptly to notify the Borrower after any such set-off and application made by
the Lender, provided that the failure to give such notice shall not affect the
validity of any such set-off and application. The rights of the Lender under
this Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which the Lender may have.

         SECTION 7.6.      BINDING EFFECT. This Agreement shall become effective
when it shall have been executed by the Borrower and the Lender and thereafter
shall be binding upon and inure to the benefit of the Borrower, the Lender and
their respective successors and assigns, except that the Borrower shall have no
right to assign its rights hereunder or any interest herein without the prior
written consent of the Lender.

         SECTION 7.7.      ASSIGNMENTS AND PARTICIPATIONS. (a) The Lender may
assign to one or more banks or other entities all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of the Loan owing to it, the Note held by it and the remaining Loan
Documents). Prompt notice of such assignment shall be given by the Lender to the
Borrower.

                  (b)      The Lender may sell participations to one or more
banks or other entities in or to all or a portion of its rights and obligations
under this Agreement (including, without limita-

                                      -47-
<PAGE>

tion, all or a portion of the Loan owing to it and the Note held by it).

                  (c)      The Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section,
disclose to the assignee or participant or proposed assignee or participant, any
information relating to the Borrower furnished to such Lender by or on behalf of
the Borrower; provided that, prior to any such disclosure, the assignee or
participant or proposed assignee or participant shall agree to preserve the
confidentiality of any confidential information relating to the Borrower
received by it from the Lender pursuant to the terms of Section 7.12.

         SECTION 7.8.      SEVERABILITY OF PROVISIONS. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.

         SECTION 7.9.      SURVIVAL OF COVENANTS. All covenants, agreements,
representations and warranties made by the Borrower in this Agreement or in any
other Loan Document or any instrument, document or certificate delivered
pursuant hereto or thereto shall be deemed to have been material and relied on
by the Lender, notwithstanding any investigation made by the Lender, and shall
survive the execution and delivery of this Agreement and of such instrument,
document or certificate until repayment of all amounts due hereunder and under
the Note; provided, however, that the Obligations of the Borrower under Section
7.4 of this Agreement shall survive such repayment.

         SECTION 7.10.     APPLICATION OF PAYMENTS. The Lender shall have the
continuing and exclusive right to correctly apply or reverse and re-apply any
and all payments to any portion of the obligations of the Borrower. To the
extent that the Borrower makes a payment or payments to the Lender which payment
or any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, receiver or any
other party under any bankruptcy law

                                      -48-
<PAGE>

or state, Commonwealth or federal law, or equitable cause, then, to the extent
of such payment received, the Obligations of the Borrower or part thereof
intended to be satisfied shall be revived and continue in full force and effect,
as if such payment had not been received by the Lender.

         SECTION 7.11.     EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.

         SECTION 7.12.     CONFIDENTIALITY. The Lender agrees to keep
confidential all non-public information pertaining to the Loan Parties which is
provided to it by any such parties in accordance with the Lender's customary
procedures for handling confidential information of this nature, and shall not
disclose information to any Person except (i) to such the extent such
information is public when received by the Lender or becomes public thereafter
due to the act or omission of any party other than the Lender, (ii) to the
extent such information is independently obtained from a source other than the
Borrower and such information from such source is not, to the Lender's
knowledge, subject to any obligation of confidentiality or, if such information
is subject to an obligation of confidentiality, that disclosure of such
information is permitted, (iii) to any Affiliate of the Lender, counsel,
auditor, examiner or any regulatory authority having jurisdiction over the
Lender, accountants and other consultants retained by the Lender, (iv) in
connection with any litigation or the enforcement of the rights of the Lender
under this Agreement or any other Loan Document, (v) to the extent required by
any applicable statute, rule or regulation or court order (including, without
limitation, by way of subpoena) or pursuant to the request of any Governmental
Authority having jurisdiction over the Lender, or (vi) to the extent disclosure
to other Persons is appropriate in connection with any proposed or actual
assignment or grant of a

                                      -49-
<PAGE>

participation to such other Person (who will in turn be required to maintain
confidentiality as if it were the Lender party to this Agreement). In no event
shall the Lender be obligated or required to return any such information or
other materials furnished by the Borrower pursuant to this Agreement or the
other Loan Documents.

         SECTION 7.13.     WAIVER OF JURY TRIAL. THE BORROWER AND THE LENDER
HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR
RELATING TO ANY OF THE LOAN DOCUMENTS, THE ADVANCE OR THE ACTIONS OF THE LENDER
IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

         SECTION 7.14.     GOVERNING LAW. This Agreement shall be governed by,
and construed in accordance with, the laws of the Commonwealth of Puerto Rico.

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

                                    BORROWER:

                                    TRIPLE-S MANAGEMENT CORPORATION

                                    By: /s/ Miguel A. Vazquez
                                       ----------------------------
                                    Name: Miguel A. Vazquez Deynes
                                    Title: President

                                    LENDER:

                                    FIRSTBANK PUERTO RICO

                                    By: /s/ Luis M. Beauchamp
                                       -----------------------------
                                    Name: Luis M. Beauchamp
                                    Title: Senior Executive Vice President

                                      -50-
<PAGE>

                                                                       EXHIBIT A

                                 [Form of Note]

                                 PROMISSORY NOTE

<PAGE>

                                 PROMISSORY NOTE

$41,000,000.00                                             San Juan, Puerto Rico
                                                                   June 29, 1999

         FOR VALUE RECEIVED, the undersigned TRIPLE-S MANAGEMENT CORPORATION, a
corporation organized and existing under the laws of the Commonwealth of Puerto
Rico (hereinafter referred to as the "Borrower"), hereby promises to pay to the
order of FIRSTBANK PUERTO RICO (the "Lender") the principal sum of FORTY ONE
MILLION DOLLARS ($41,000,000.00) in consecutive monthly installments as follows:
(i) on August 1st, 1999 the principal sum of $136,665.67 and (ii) on the first
day of each calendar month thereafter; 299 consecutive monthly installments,
each in the principal sum of $136,666.67.

         All capitalized terms used herein without definition shall have the
respective meanings provided therefor in the Credit Agreement dated as of even
date herewith between the Borrower and the Lender (the "Credit Agreement").

         The Borrower also promises to pay interest on the unpaid principal
amount hereof from time to time outstanding from the date hereof until such
principal amount is paid in full at the rates per annum set forth in the Credit
Agreement. Such interest shall be payable on such dates as are established in
the Credit Agreement and shall be calculated as therein provided.

         Both the principal hereof and the interest hereon are payable in lawful
money of the United States of America and in immediately available funds at
the branch offices of the Lender, located at 1519 Ponce de Leon Avenue, Stop 23,
Santurce, San Juan, Puerto Rico, or at such other place as the holder may
specify in writing.

         The Lender shall, and is hereby authorized by the Borrower to, note on
records maintained by the Lender with respect thereto, the amount of the Loan,
the interest rate and each repayment of principal with respect to the Loan. Such
records shall be prima facie evidence as to the aggregate unpaid principal
amount of the Loan evidenced hereby and the terms thereof; provided, however,
that the failure of the Lender to make such recordation shall not limit or
otherwise affect the obligation of the Borrower to repay such Loan or any
interest accrued or accruing thereon or any other amount payable by the Borrower
to the Lender hereunder.

         Presentment, demand, protest and other notice of any kind are hereby
expressly waived to the extent permitted by law.

<PAGE>

         In the event that any action, suit or other proceeding is brought by
the holder hereof to collect this Note, the Borrower shall be liable for all
court costs and expenses of collection, including, without limitation,
reasonable attorney's fees and disbursements.

         This Note is executed and delivered to the Lender pursuant to the
Credit Agreement and is entitled to the benefits of the Credit Agreement and of
the other Loan Documents. The Credit Agreement, among other things, contains
provisions for acceleration of the maturity hereof upon the happening of certain
stated events, the occurrence of which shall cause the unpaid principal amount
of this Note and accrued interest thereof to immediately become due and payable.

         This Note shall be interpreted, governed by, construed and enforced in
accordance with the laws of the Commonwealth of Puerto Rico.

         This Note may be modified only by a writing duly executed by the holder
hereof and the Borrower.

                                             TRIPLE-S MANAGEMENT CORPORATION
                                                           Borrower

                                             By: /s/ Miguel A. Vazquez
                                                ----------------------------
                                             Name: Miguel A. Vazquez Deynes
                                             Title: President
Affidavit Number 6.607
                 ---------

         Sworn and subscribed to before me by Miguel A. Vazquez Deynes, of legal
age, married, executive and resident of San Juan, Puerto Rico, as President of
Triple-S Management Corporation, personally known to me, in San Juan, Puerto
Rico, this 29th day of June 1999.

                                             /s/ Leopoldo J. Cabassa Sauri
                                             -------------------------------
                                             NOTARY PUBLIC
(SEAL)

                                                                              2

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