Document:

<PAGE>

                                                                   EXHIBIT 10.27

                                                                  CONFORMED COPY

                                  $500,000,000

                                CREDIT AGREEMENT

                                  dated as of

                                October 29, 1996

                                     among

                                UNUM CORPORATION

                            The BANKS Listed Herein

                                      and

                   MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
                                    as Agent
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<TABLE>
<CAPTION>
                             TABLE OF CONTENTS*

                                                                      Page
                                                                      ----
                                   ARTICLE I

                                  DEFINITIONS
           <S>                                                         <C>
           SECTION 1.01.  Definitions................................   1
                          -----------
           SECTION 1.02.  Accounting Terms and Determinations........  16
                          -----------------------------------
           SECTION 1.03.  Types of Borrowings........................  17
                          -------------------
           SECTION 1.04.  Basis for Ratings..........................  17
                          -----------------
           SECTION 1.05.  Split Ratings..............................  17
                          -------------

                                  ARTICLE II

                                 THE CREDITS

           SECTION 2.01.  Commitments to Lend........................  18
                          -------------------
           SECTION 2.02.  Notice of Committed Borrowing..............  18
                          -----------------------------
           SECTION 2.03.  Money Market Borrowings....................  19
                          -----------------------
           SECTION 2.04.  Notice to Banks; Funding of Loans..........  23
                          ---------------------------------
           SECTION 2.05.  Notes......................................  24
                          -----
           SECTION 2.06.  Maturity of Loans..........................  25
                          -----------------
           SECTION 2.07.  Interest Rates.............................  25
                          --------------
           SECTION 2.08.  Fees.......................................  29
                          ----
           SECTION 2.09.  Optional Termination or Reduction of
                          ------------------------------------
                          Commitments................................  29
                          -----------
           SECTION 2.10.  Mandatory Termination of Commitments.......  30
                          ------------------------------------
           SECTION 2.11.  Optional Prepayments.......................  30
                          --------------------
           SECTION 2.12.  General Provisions as to Payments..........  30
                          ---------------------------------
           SECTION 2.13.  Funding Losses.............................  31
                          --------------
           SECTION 2.14.  Computation of Interest and Fees...........  31
                          --------------------------------
           SECTION 2.15.  Withholding Tax Exemption..................  32
                          -------------------------
           SECTION 2.16.  Regulation D Compensation..................  32
                          -------------------------
</TABLE>
*The Table of Contents is not a part of this Agreement.

                                       i
<PAGE>

<TABLE>
<CAPTION>
                                                                     Page
                                                                     ----
                                   ARTICLE III

                                   CONDITIONS
           <S>                                                       <C>
           SECTION 3.01.  Effectiveness..............................  33
                          -------------
           SECTION 3.02.  Borrowings.................................  34
                          ----------

                                     ARTICLE IV

                            REPRESENTATIONS AND WARRANTIES

           SECTION 4.01.  Corporate Existence and Power..............  35
                          -----------------------------
           SECTION 4.02.  Corporate and Governmental Authorization;
                          -----------------------------------------
                          No Contravention...........................  35
                          ----------------
           SECTION 4.03.  Binding Effect.............................  36
                          --------------
           SECTION 4.04.  Financial Information......................  36
                          ---------------------
           SECTION 4.05.  Litigation.................................  38
                          ----------
           SECTION 4.06.  Compliance with ERISA......................  38
                          ---------------------
           SECTION 4.07.  Taxes......................................  39
                          -----
           SECTION 4.08.  Subsidiaries...............................  39
                          ------------
           SECTION 4.09.  Not an Investment Company..................  39
                          -------------------------
           SECTION 4.10.  Full Disclosure............................  39
                          ---------------

                                    ARTICLE V

                                    COVENANTS

           SECTION 5.01.  Financial Statements.......................  40
                          --------------------
           SECTION 5.02.  Litigation.................................  44
                          ----------
           SECTION 5.03.  Corporate Existence, Etc...................  45
                          ------------------------
           SECTION 5.04.  Use of Proceeds............................  45
                          ---------------
           SECTION 5.05.  Prohibition of Fundamental Changes.........  46
                          ----------------------------------
           SECTION 5.06.  Limitation on Liens........................  48
                          -------------------
           SECTION 5.07.  Transactions with Affiliates...............  50
                          ----------------------------
           SECTION 5.08.  Minimum Total Stockholders' Equity.........  50
                          ----------------------------------
           SECTION 5.09.  Ratio of Funded Indebtedness to Total
                          -------------------------------------
                          Capital....................................  50
                          -------
           SECTION 5.10.  Restricted and Unrestricted Subsidiaries...  50
                          ----------------------------------------

                                   ARTICLE VI

                                    DEFAULTS

           SECTION 6.01.  Events of Default..........................  51
                          -----------------
           SECTION 6.02.  Notice of Default..........................  53
                          -----------------
</TABLE>

                                       ii
<PAGE>

                                  ARTICLE VII

                                   THE AGENT
<TABLE>
<S>                                                                    <C>
           SECTION 7.01.  Appointment and Authorization..............  54
                          -----------------------------
           SECTION 7.02.  Agent and Affiliates.......................  54
                          --------------------
           SECTION 7.03.  Action by Agent............................  54
                          ---------------
           SECTION 7.04.  Consultation with Experts..................  54
                          -------------------------
           SECTION 7.05.  Liability of Agent.........................  54
                          ------------------
           SECTION 7.06.  Indemnification............................  55
                          ---------------
           SECTION 7.07.  Credit Decision............................  55
                          ---------------
           SECTION 7.08.  Successor Agent............................  55
                          ---------------
           SECTION 7.09.  Agent's Fee................................  56
                          -----------

                                 ARTICLE VIII

                            CHANGE IN CIRCUMSTANCES

           SECTION 8.01.  Basis for Determining Interest Rate
                          -----------------------------------
                          Inadequate or Unfair.......................  56
                          --------------------
           SECTION 8.02.  Illegality.................................  57
                          ----------
           SECTION 8.03.  Increased Cost and Reduced Return..........  57
                          ---------------------------------
           SECTION 8.04.  Base Rate Loans Substituted for Affected
                          ----------------------------------------
                          Fixed Rate Loans...........................  59
                          ----------------

                                  ARTICLE IX

                                 MISCELLANEOUS

           SECTION 9.01.  Notices....................................  60
                          -------
           SECTION 9.02.  No Waivers.................................  60
                          ----------
           SECTION 9.03.  Expenses; Documentary Taxes;
                          ----------------------------
                          Indemnification............................  61
                          ---------------
           SECTION 9.04.  Sharing of Set-Offs........................  61
                          -------------------
           SECTION 9.05.  Amendments and Waivers.....................  62
                          ----------------------
           SECTION 9.06.  Successors and Assigns.....................  62
                          ----------------------
           SECTION 9.07.  Collateral.................................  64
                          ----------
           SECTION 9.08.  Governing Law; Submission to Jurisdiction..  64
                          -----------------------------------------
           SECTION 9.09.  Counterparts; Integration .................  65
                          -------------------------
           SECTION 9.10.  Confidentiality............................  65
                          ---------------
</TABLE>

       Schedule I -  Certain Subsidiaries

       Exhibit A -   Note

       Exhibit B -   Money Market Quote Request

                                      iii
<PAGE>

                                                                     Page
                                                                     ----
       Exhibit C -   Invitation for Money Market Quotes

       Exhibit D -   Money Market Quote

       Exhibit E -   Opinion of the General Counsel of the Borrower

       Exhibit F -   Opinion of Special Counsel for the Agent

       Exhibit G -   Assignment and Assumption Agreement

                                       iv
<PAGE>

                                CREDIT AGREEMENT

     AGREEMENT dated as of October 29, 1996 among UNUM CORPORATION, the BANKS
listed on the signature pages hereof and MORGAN GUARANTY TRUST COMPANY OF NEW
YORK, as Agent.

     The parties hereto agree as follows:

                                   ARTICLE I

                                  DEFINITIONS

     SECTION 1.01. Definitions. The following terms, as used herein, have the
                   -----------
following meanings:

     "Absolute Rate Auction" means a solicitation of Money Market Quotes setting
forth Money Market Absolute Rates pursuant to Section 2.03.

     "Adjusted CD Rate" has the meaning set forth in Section 2.07(b).

     "Administrative Questionnaire" means, with respect to each Bank, an
administrative questionnaire in the form prepared by the Agent and submitted to
the Agent (with a copy to the Borrower) duly completed by such Bank.

     "Affiliate" means any Person which directly or indirectly controls, or is
under common control with, or is controlled by, the Borrower. As used in this
definition, "control" (including, with its correlative meanings, "controlled by"
and "under common control with") means possession, directly or indirectly, of
power to direct or cause the direction of management or policies (whether
through ownership of securities or partnership or other ownership interests, by
contract or otherwise), provided that, in any event, any Person which owns
                        --------
directly or indirectly 15% or more of the securities having ordinary voting
power for the election of directors or other governing body of a corporation or
15% or more of the partnership or other ownership interests of any other Person
(other than as a limited partner of such other Person) will be rebuttably
presumed to control such corporation or other Person, such presumption to be
rebutted only if the Required Banks agree in writing that such Person does not
control such corporation or other Person. Notwithstanding the
<PAGE>

foregoing, (i) no individual shall be deemed to be an Affiliate of any Person
solely by reason of his or her being an officer of such Person and (ii) the
Borrower and the Restricted Subsidiaries shall not be deemed to be Affiliates of
each other.

     "Agent" means Morgan Guaranty Trust Company of New York in its capacity as
agent for the Banks hereunder, and its successors in such capacity.

     "Applicable Insurance Regulatory Authority" means, when used with respect
to any Restricted Insurance Subsidiary, the insurance commission, department or
similar regulatory authority or agency located in the jurisdiction in which such
Restricted Insurance Subsidiary is domiciled.

     "Applicable Lending Office" means, with respect to any Bank, (i) in the
case of its Domestic Loans, its Domestic Lending Office, (ii) in the case of its
Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the case of its
Money Market Loans, its Money Market Lending Office.

     "Applicable Margin" has the meaning set forth in Section 2.07(h).

     "Assessment Rate" has the meaning set forth in Section 2.07(b).

     "Assignee" has the meaning set forth in Section 9.06(c).

     "Bank" means each bank listed on the signature pages hereof, each Assignee
which becomes a Bank pursuant to Section 9.06(c), and their respective
successors.

     "Base Rate" means, for any day, a rate per annum equal to the higher of (i)
the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the Federal Funds
Rate for such day.

     "Base Rate Loan" means a Committed Loan to be made by a Bank as a Base Rate
Loan in accordance with the applicable Notice of Committed Borrowing or pursuant
to Article VIII.

     "Benefit Arrangement" means at any time an employee benefit plan within the
meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and
which is maintained or otherwise contributed to by any member of the ERISA
Group.

                                       2
<PAGE>

     "Borrower" means UNUM Corporation, a Delaware corporation, and its
successors.

     "Borrower's 1995 Form 10-K" means the Borrower's annual report on Form 10-K
for 1995, as filed with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934.

     "Borrowing" has the meaning set forth in Section 1.03.

     "Capitalized Lease Obligations" means, as to any Person, the obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) real and/or personal property, which obligations are
required to be classified and accounted for as a capital lease on the balance
sheet of such Person under generally accepted accounting principles (including
Statement of Financial Accounting Standards No. 13 of the Financial Accounting
Standards Board) and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with generally accepted accounting principles (including such Statement No. 13).

     "CD Base Rate" has the meaning set forth in Section 2.07(b).

     "CD Loan" means a Committed Loan to be made by a Bank as a CD Loan in
accordance with the applicable Notice of Committed Borrowing.

     "CD Reference Banks" means ABN Amro Bank N.V., New York Branch, Wachovia
Bank of Georgia, N.A., and Morgan Guaranty Trust Company of New York.

     "Commitment" means, with respect to each Bank, the amount set forth
opposite the name of such Bank on the signature pages hereof, as such amount may
be reduced from time to time pursuant to Sections 2.09 and 2.10.

     "Committed Loan" means a loan made by a Bank pursuant to Section 2.01.

     "Confidential Information" has the meaning set forth in Section 9.10.

     "Consolidated Subsidiary" means at any date any Subsidiary or other entity
the accounts of which would be consolidated with those of the Borrower in its
consolidated financial statements if such statements were prepared as of

                                       3
<PAGE>

such date.

     "Default" means any condition or event which constitutes an Event of
Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.

     "Domestic Business Day" means any day except a Saturday, Sunday or other
day on which commercial banks in New York City are authorized by law to close.

     "Domestic Lending Office" means, as to each Bank, its office located at its
address set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its Domestic Lending Office) or such other
office as such Bank may hereafter designate as its Domestic Lending Office by
notice to the Borrower and the Agent; provided that any Bank may so designate
                                      --------
separate Domestic Lending Offices for its Base Rate Loans, on the one hand, and
its CD Loans, on the other hand, in which case all references herein to the
Domestic Lending Office of such Bank shall be deemed to refer to either or both
of such offices, as the context may require.

     "Domestic Loans"  means CD Loans or Base Rate Loans or both.

     "Domestic Reserve Percentage" has the meaning set forth in Section 2.07(b).

     "Effective Date" means the date this Agreement becomes effective in
accordance with Section 3.01.

     "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.

     "ERISA Group" means the Borrower, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Borrower or any
Subsidiary, are treated as a single employer under Section 414 of the Internal
Revenue Code.

     "Euro-Dollar Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.

     "Euro-Dollar Lending Office" means, as to each Bank, its office, branch or
affiliate located at its address set forth in its Administrative Questionnaire
(or identified in its Administrative Questionnaire

                                       4
<PAGE>

(or identified in its Administrative Questionnaire as its Euro-Dollar Lending
Office) or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Euro-Dollar Lending Office by notice to the Borrower
and the Agent.

     "Euro-Dollar Loan" means a Committed Loan to be made by a Bank as a Euro-
Dollar Loan in accordance with the applicable Notice of Committed Borrowing.

     "Euro-Dollar Reference Banks" means the principal London offices of ABN
Amro Bank N.V., New York Branch, Wachovia Bank of Georgia, N.A., and Morgan
Guaranty Trust Company of New York.

     "Euro-Dollar Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
Euro-Dollar Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents).

     "Event of Default" has the meaning set forth in Section 6.01.

     "Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Domestic Business Day
next succeeding such day, provided that (i) if such day is not a Domestic
                          --------
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on the
next succeeding Domestic Business Day, and (ii) if no such rate is so published
on such next succeeding Domestic Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to Morgan Guaranty Trust Company of New
York on such day on such transactions as determined by the Agent.

     "Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money Market
Loans (excluding Money Market

                                       5
<PAGE>

LIBOR Loans bearing interest at the Base Rate pursuant to Section 8.01(a)) or
any combination of the foregoing.

     "Funded Indebtedness" means, for the Borrower and the Restricted
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles, Indebtedness that (i) matures more than one year
from the date of its creation or (ii) matures on or within one year from the
date of its creation but is renewable or extendable at the option of the obligor
thereof to a date more than one year from the date of its creation, provided
                                                                    --------
that, for purposes of this definition, Indebtedness shall be deemed to be
renewable or extendable at the option of the obligor thereof if it arises under
a credit or other similar agreement that obligates the lender or lenders
thereunder to extend credit to such obligor notwithstanding that the ability of
such obligor to renew or extend such Indebtedness is subject to the satisfaction
of conditions precedent.

     "Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Indebtedness of any other
Person and, without limiting the generality of the foregoing, any obligation,
direct or indirect, contingent or otherwise, of such Person (i) to purchase or
pay (or advance or supply funds for the purchase or payment of) such
Indebtedness (whether arising by virtue of partnership arrangements, by
agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or (ii)
entered into for the purpose of assuring in any other manner the obligee of such
Indebtedness of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part), provided that the term Guarantee shall
                                       --------
not include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.

     "Home Office Properties" means any building in which the principal office
of the Borrower or any Restricted Subsidiary of the Borrower is located.

     "Indebtedness" of any Person means at any date, without duplication, (i)
all obligations of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay the deferred purchase price of property or
services, except trade accounts payable arising in the ordinary course of
business, (iv) all Capitalized Lease Obligations of such Person, (v) all
Indebtedness secured by a Lien on any asset

                                       6
<PAGE>

of such Person, whether or not such Indebtedness is otherwise an obligation of
such Person, (vi) all obligations of such Person to purchase securities (or
other property) which arise out of or in connection with the sale of the same or
substantially similar securities or property, (vii) all non-contingent
obligations of such Person to reimburse any bank or other Person in respect of
amounts paid under a letter of credit or similar instrument and (viii) all
Indebtedness of others Guaranteed by such Person.

     "Indemnitee" has the meaning set forth in Section 9.03(b).

     "Insurance Subsidiary" means a Subsidiary that is a Restricted Insurance
Subsidiary or would be a Restricted Insurance Subsidiary if it were a Restricted
Subsidiary.

     "Interest Period" means: (1) with respect to each Euro-Dollar Borrowing,
the period commencing on the date of such Borrowing and ending one, two, three
or six months thereafter, as the Borrower may elect in the applicable Notice of
Borrowing; provided that:
           --------

     (a) any Interest Period which would otherwise end on a day which is not a
   Euro-Dollar Business Day shall be extended to the next succeeding Euro-Dollar
   Business Day unless such Euro-Dollar Business Day falls in another calendar
   month, in which case such Interest Period shall end on the next preceding
   Euro-Dollar Business Day;

     (b) any Interest Period which begins on the last Euro-Dollar Business Day
   of a calendar month (or on a day for which there is no numerically
   corresponding day in the calendar month at the end of such Interest Period)
   shall, subject to clause (c) below, end on the last Euro-Dollar Business Day
   of a calendar month; and

     (c) any Interest Period which would otherwise end after the Termination
   Date shall end on the Termination Date;

(2) with respect to each CD Borrowing, the period commencing on the date of such
Borrowing and ending 30, 60, 90 or 180 days thereafter, as the Borrower
may elect in the applicable Notice of Borrowing; provided that:
                                                 --------

     (a) any Interest Period which would otherwise end on a day which is not a
   Euro-Dollar Business Day shall be extended to the next succeeding Euro-Dollar
   Business Day; and

                                       7
<PAGE>

     (b) any Interest Period which would otherwise end after the Termination
   Date shall end on the Termination Date;

(3) with respect to each Base Rate Borrowing, the period commencing on the date
of such Borrowing and ending 30 days thereafter; provided that:
                                                 --------

     (a) any Interest Period which would otherwise end on a day which is not a
   Euro-Dollar Business Day shall be extended to the next succeeding Euro-Dollar
   Business Day; and

     (b) any Interest Period which would otherwise end after the Termination
   Date shall end on the Termination Date;

(4) with respect to each Money Market LIBOR Borrowing, the period commencing on
the date of such Borrowing and ending such whole number of months thereafter as
the Borrower may elect in accordance with Section 2.03; provided that :
                                                        --------

     (a) any Interest Period which would otherwise end on a day which is not a
   Euro-Dollar Business Day shall be extended to the next succeeding Euro-Dollar
   Business Day unless such Euro-Dollar Business Day falls in another calendar
   month, in which case such Interest Period shall end on the next preceding
   Euro-Dollar Business Day;

     (b) any Interest Period which begins on the last Euro-Dollar Business Day
   of a calendar month (or on a day for which there is no numerically
   corresponding day in the calendar month at the end of such Interest Period)
   shall, subject to clause (c) below, end on the last Euro-Dollar Business Day
   of a calendar month; and

     (c) any Interest Period which would otherwise end after the Termination
   Date shall end on the Termination Date; and

(5) with respect to each Money Market Absolute Rate Borrowing, the period
commencing on the date of such Borrowing and ending such number of days
thereafter (but not less than 7 days) as the Borrower may elect in accordance
with Section 2.03; provided that:
                   --------

     (a) any Interest Period which would otherwise end on a day which is not a
   Euro-Dollar Business Day shall be extended to the next succeeding Euro-Dollar
   Business

                                       8
<PAGE>

   Day; and

      (b) any Interest Period which would otherwise end after the Termination
    Date shall end on the Termination Date.

     "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended, or any successor statute.

     "Investment" means any investment in any Person whether by means of share
purchase, capital contribution, loan, time deposit or otherwise, provided that,
                                                                 --------
in the case of any investment in any Unrestricted Subsidiary, the definition of
"Investment" shall not include investments resulting from (i) the provision of
administrative services by the Borrower or any Restricted Subsidiary to such
Unrestricted Subsidiary, which services are provided in the ordinary course of
the business of the Borrower or such Restricted Subsidiary, as the case may be,
and of such Unrestricted Subsidiary, (ii) the operation of the cash management
system of the Borrower and its Subsidiaries so long as it is operated in the
ordinary course of their business or (iii) transfers made, or accounts created,
in connection with any tax sharing agreement to which the Borrower or any
Restricted Subsidiary, as the case may be, and such Unrestricted Subsidiary is a
party.

     "Level I Status" exists on any date (1) if, on such date, the Borrower has
outstanding senior unsecured long-term Indebtedness which is rated at least AA-
from S&P or at least Aa3 from Moody's or (2) in the case that no such
Indebtedness is outstanding, if the Borrower provides written evidence from S&P
or Moody's to the Banks, such evidence to be satisfactory to the Required Banks,
to the effect that if the Borrower had any such Indebtedness outstanding on such
date, such Indebtedness would be rated at least AA- from S&P or at least Aa3
from Moody's. For purposes of this definition, the provisions in clause (2) in
the preceding sentence shall not apply for more than 365 consecutive days after
the first date of the written evidence most recently provided by the Borrower
from S&P or Moody's to the Banks, which evidence was relied on by the Required
Banks to establish that the provisions of such clause (2) were then operative.

     "Level II Status" exists on any date (1) if, on such date, the Borrower has
outstanding senior unsecured long-term Indebtedness which is rated at least A+
from S&P or at least A1 from Moody's or (2) in the case that no such
Indebtedness is outstanding, if the Borrower provides written evidence from S&P
or Moody's to the Banks, such

                                       9
<PAGE>

evidence to be satisfactory to the Required Banks, to the effect that if the
Borrower had any such Indebtedness outstanding on such date, such Indebtedness
would be rated at least A+ from S&P or at least A1 from Moody's. For purposes of
this definition, the provisions in clause (2) in the preceding sentence shall
not apply for more than 365 consecutive days after the first date of the written
evidence most recently provided by the Borrower from S&P or Moody's to the
Banks, which evidence was relied on by the Required Banks to establish that the
provisions of such clause (2) were then operative.

     "Level III Status" exists on any date (1) if, on such date, the Borrower
has outstanding senior unsecured long-term Indebtedness which is rated at least
A from S&P or at least A2 from Moody's or (2) in the case that no such
Indebtedness is outstanding, if the Borrower provides written evidence from S&P
or Moody's to the Banks, such evidence to be satisfactory to the Required Banks,
to the effect that if the Borrower had any such Indebtedness outstanding on such
date, such Indebtedness would be rated at least A from S&P or at least A2 from
Moody's. For purposes of this definition, the provisions in clause (2) in the
preceding sentence shall not apply for more than 365 consecutive days after the
first date of the written evidence most recently provided by the Borrower from
S&P or Moody's to the Banks, which evidence was relied on by the Required Banks
to establish that the provisions of such clause (2) were then operative.

     "Level IV Status" exists on any date (1) if, on such date, the Borrower has
outstanding senior unsecured long-term Indebtedness which is rated at least A-
from S&P or at least A3 from Moody's or (2) in the case that no such
Indebtedness is outstanding, if the Borrower provides written evidence from S&P
or Moody's to the Banks, such evidence to be satisfactory to the Required Banks,
to the effect that if the Borrower had any such Indebtedness outstanding on such
date, such Indebtedness would be rated at least A- from S&P or at least A3 from
Moody's. For purposes of this definition, the provisions in clause (2) in the
preceding sentence shall not apply for more than 365 consecutive days after the
first date of the written evidence most recently provided by the Borrower from
S&P or Moody's to the Banks, which evidence was relied on by the Required Banks
to establish that the provisions of such clause (2) were then operative.

     "Level V Status" exists on any date (1) if, on such date, the Borrower has
outstanding senior unsecured long-term Indebtedness which is rated at least BBB+
from S&P

                                       10
<PAGE>

or at least Baa1 from Moody's or (2) in the case that no such Indebtedness is
outstanding, if the Borrower provides written evidence from S&P or Moody's to
the Banks, such evidence to be satisfactory to the Required Banks, to the effect
that if the Borrower had any such Indebtedness outstanding on such date, such
Indebtedness would be rated at least BBB+ from S&P or at least Baa1 from
Moody's. For purposes of this definition, the provisions in clause (2) in the
preceding sentence shall not apply for more than 365 consecutive days after the
first date of the written evidence most recently provided by the Borrower from
S&P or Moody's to the Banks, which evidence was relied on by the Required Banks
to establish that the provisions of such clause (2) were then operative.

     "Level VI Status" exists on any date (1) if, on such date, the Borrower has
outstanding senior unsecured long-term Indebtedness which is rated at least BBB
from S&P or at least Baa2 from Moody's or (2) in the case that no such
Indebtedness is outstanding, if the Borrower provides written evidence from S&P
or Moody's to the Banks, such evidence to be satisfactory to the Required Banks,
to the effect that if the Borrower had any such Indebtedness outstanding on such
date, such Indebtedness would be rated at least BBB from S&P or at least Baa2
from Moody's. For purposes of this definition, the provisions in clause (2) in
the preceding sentence shall not apply for more than 365 consecutive days after
the first date of the written evidence most recently provided by the Borrower
from S&P or Moody's to the Banks, which evidence was relied on by the Required
Banks to establish that the provisions of such clause (2) were then operative.

     "Level VII Status" exists on any date if neither Level I nor Level II nor
Level III nor Level IV nor Level V nor Level VI exists on such date.

     "LIBOR Auction" means a solicitation of Money Market Quotes setting forth
Money Market Margins based on the London Interbank Offered Rate pursuant to
Section 2.03.

     "Lien" means, with respect to any asset owned by any Person, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such asset. For the purposes of this Agreement, any Person shall be deemed to
own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.

     "Loan" means a Domestic Loan or a Euro-Dollar Loan

                                       11
<PAGE>

or a Money Market Loan and "Loans" means Domestic Loans or Euro-Dollar Loans or
Money Market Loans or any combination of the foregoing.

     "London Interbank Offered Rate" has the meaning set forth in Section
2.07(c).

     "Material Indebtedness" means Indebtedness (other than the Notes) of the
Borrower and/or one or more of its Subsidiaries, arising in one or more related
or unrelated transactions, in an aggregate principal amount exceeding
$10,000,000.

     "Material Plan" means at any time a Plan or Plans having aggregate Unfunded
Liabilities in excess of $20,000,000.

     "Money Market Absolute Rate" has the meaning set forth in Section 2.03(d).

     "Money Market Absolute Rate Loan" means a loan to be made by a Bank
pursuant to an Absolute Rate Auction.

     "Money Market Lending Office" means, as to each Bank, its Domestic Lending
Office or such other office, branch or affiliate of such Bank as it may
hereafter designate as its Money Market Lending Office by notice to the Borrower
and the Agent; provided that any Bank may from time to time by notice to the
Borrower and the Agent designate separate Money Market Lending Offices for its
Money Market LIBOR Loans, on the one hand, and its Money Market Absolute Rate
Loans, on the other hand, in which case all references herein to the Money
Market Lending Office of such Bank shall be deemed to refer to either or both of
such offices, as the context may require.

     "Money Market LIBOR Loan" means a loan to be made by a Bank pursuant to a
LIBOR Auction (including such a loan bearing interest at the Base Rate pursuant
to Section 8.01(a)).

     "Money Market Loan" means a Money Market LIBOR Loan or a Money Market
Absolute Rate Loan.

     "Money Market Margin" has the meaning set forth in Section 2.03(d).

     "Money Market Quote" means an offer by a Bank to make a Money Market Loan
in accordance with Section 2.03.

     "Moody's" means Moody's Investors Service, Inc.

                                       12
<PAGE>

     "Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.

     "Notes" means promissory notes of the Borrower, substantially in the form
of Exhibit A hereto, evidencing the obligation of the Borrower to repay the
Loans, and "Note" means any one of such promissory notes issued hereunder.

     "Notice of Borrowing" means a Notice of Committed Borrowing (as defined in
Section 2.02) or a Notice of Money Market Borrowing (as defined in Section
2.03(f)).

     "Parent" means, with respect to any Bank, any Person
controlling such Bank.

     "Participant" has the meaning set forth in Section 9.06(b).

     "PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.

     "Person" means an individual, a corporation, a partnership, an association,
a trust or any other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof.

     "Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.

     "Prime Rate" means the rate of interest publicly announced by Morgan
Guaranty Trust Company of New York in New York City from time to time as its
Prime Rate.

                                       13
<PAGE>

     "Reference Banks" means the CD Reference Banks or the Euro-Dollar Reference
Banks, as the context may require, and "Reference Bank" means any one of such
Reference Banks.

     "Refunding Borrowing" means a Committed Borrowing which, after application
of the proceeds thereof, results in no net increase in the outstanding principal
amount of Committed Loans made by any Bank.

     "Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.

     "Regulation X" means Regulation X of the Board of Governors of the Federal
Reserve System, as in effect from time to time.

     "Required Banks" means at any time Banks having at least a majority of the
aggregate amount of the Commitments or, if the Commitments shall have been
terminated, holding Notes evidencing at least a majority of the aggregate unpaid
principal amount of the Loans.

     "Restricted Insurance Subsidiary" means a Restricted Subsidiary that is
licensed, authorized or admitted to carry on or transact the business of
insurance.

     "Restricted Subsidiary" means: (i) the Subsidiaries listed as such on
Schedule I hereto and (ii) any Subsidiary acquired or organized after the
Effective Date and any Unrestricted Subsidiary in each case that is duly
designated by the Borrower, pursuant to Section 5.10, to be a Restricted
Subsidiary; provided that any such Subsidiary included solely within clause (ii)
            --------
shall cease being a Restricted Subsidiary if and when it is duly designated by
the Borrower, pursuant to Section 5.10, as an Unrestricted Subsidiary.

     "S&P" means Standard & Poor's, a division of the McGraw-Hill Companies,
Inc.

     "Status" means, at any date, whichever of Level I Status, Level II Status,
Level III Status, Level IV Status, Level V Status, Level VI Status, or Level VII
Status exists at such date.

     "Subsidiary" means any corporation or other entity of which securities or
other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned by the Borrower.

                                       14
<PAGE>

     "Termination Date" means October 1, 2001, or, if such day is not a Euro-
Dollar Business Day, the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
Termination Date shall be on the next preceding Euro-Dollar Business Day.

     "Total Assets" means the total assets of the Borrower and the Restricted
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles, less the excess (if any) of (i) any Investment
                                ----
of the Borrower or any Restricted Subsidiary in any Unrestricted Subsidiary to
the extent that such Investment appears on the consolidated balance sheet of the
Borrower and the Restricted Subsidiaries used in the calculation of Total Assets
over (ii) the amount of such Investment in such Unrestricted Subsidiary which
constitutes Indebtedness of, or other amounts receivable from, such Unrestricted
Subsidiary to the extent that the amount referred to above in this clause (ii)
does not exceed the consolidated stockholders' equity of such Unrestricted
Subsidiary and its consolidated subsidiaries.

     "Total Capital" means the sum of Funded Indebtedness and Total
Stockholders' Equity.

     "Total Stockholders' Equity" means the total stockholders' equity of the
Borrower and the Restricted Subsidiaries determined on a consolidated basis in
accordance with generally accepted accounting principles, (1) plus any
                                                              ----
unrealized holding losses (or less any unrealized holding gains) on account of
                              ----
available-for-sale debt securities to the extent reflected therein in accordance
with Statement of Financial Accounting Standards No. 115 of the Financial
Accounting Standards Board, as amended from time to time, or any successor
provision thereto, together with other appropriate adjustments in accordance
therewith, and (2) less the excess (if any) of (i) any Investment of the
                   ----
Borrower or any Restricted Subsidiary in any Unrestricted Subsidiary to the
extent that such Investment appears on the consolidated balance sheet of the
Borrower and the Restricted Subsidiaries used in the calculation of Total
Stockholders' Equity over (ii) the amount of such Investment in such
Unrestricted Subsidiary which constitutes Indebtedness of, or other amounts
receivable from, such Unrestricted Subsidiary to the extent that the amount
referred to above in this clause (ii) does not exceed the consolidated
stockholders' equity of such Unrestricted Subsidiary and its consolidated
subsidiaries.

                                       15
<PAGE>

     "Unfunded Liabilities" means, with respect to any Plan at any time, the
amount (if any) by which (i) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market
value of all Plan assets allocable to such liabilities under Title IV of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.

     "Unrestricted Subsidiary" means: (i) the Subsidiaries listed on Schedule I
hereto which are not listed therein as Restricted Subsidiaries and (ii) any
Subsidiary acquired or organized after the Effective Date that has not been duly
designated by the Borrower as a Restricted Subsidiary; provided that any such
                                                       --------
Subsidiary shall cease being an Unrestricted Subsidiary if and when it is duly
designated by the Borrower, pursuant to Section 5.10 hereof, as a Restricted
Subsidiary.

     "Utilization" means at any date the percentage equivalent of a fraction (i)
the numerator of which is the aggregate outstanding principal amount of the
Loans at such date, after giving effect to any borrowing or payment on such
date, and (ii) the denominator of which is the aggregate amount of the
Commitments at such date, after giving effect to any reduction of the
Commitments on such date. For purposes of Section 2.07(h), if for any reason any
Loans remain outstanding after termination of the Commitments, the Utilization
for each date on or after the date of such termination shall be deemed to be
greater than 50%.

     SECTION 1.02. Accounting Terms and Determinations. Unless otherwise
                   -----------------------------------
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with
generally accepted accounting principles as in effect from time to time, applied
on a basis consistent (except for changes concurred in by the Borrower's
independent public accountants) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries delivered
to the Banks; provided that, if the Borrower notifies the Agent that the
              --------
Borrower wishes to amend any covenant in Article V to eliminate the effect of
any change in generally accepted accounting principles on the operation of such
covenant (or

                                       16
<PAGE>

if the Agent notifies the Borrower that the Required Banks wish to amend Article
V for such purpose), then the Borrower's compliance with such covenant shall be
determined on the basis of generally accepted accounting principles in effect
immediately before the relevant change in generally accepted accounting
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to the Borrower and the Required
Banks.

     SECTION 1.03. Types of Borrowings. The term "Borrowing" denotes the
                   -------------------
aggregation of Loans of one or more Banks to be made to the Borrower pursuant to
Article II on a single date and for a single Interest Period. Borrowings are
classified for purposes of this Agreement either by reference to the pricing of
Loans comprising such Borrowing (e.g., a "Euro-Dollar Borrowing" is a Borrowing
                                 ----
comprised of Euro-Dollar Loans) or by reference to the provisions of Article II
under which participation therein is determined (i.e., a "Committed Borrowing"
                                                 ----
is a Borrowing under Section 2.01 in which all Banks participate in proportion
to their Commitments, while a "Money Market Borrowing" is a Borrowing under
Section 2.03 in which the Bank participants are determined on the basis of their
bids in accordance therewith).

     SECTION 1.04. Basis for Ratings. The credit ratings to be utilized in the
                   -----------------
determination of a Status and for purposes of Section 5.05(c) are the ratings
assigned to senior unsecured long-term Indebtedness of the Borrower without
third party credit support; ratings assigned to any such Indebtedness which is
secured or which has the benefit of third party credit support shall be
disregarded.

     SECTION 1.05. Split Ratings. For purposes of determining the relevant Level
                   -------------
status: (i) if at any date the rating of any senior unsecured long term debt
securities by Moody's shall be higher or lower than the comparable rating by S&P
by one rating level (it being understood that for these purposes an S&P rating
of A+ is comparable to a Moody's rating of A1, an S&P rating of A is comparable
to a Moody's rating of A2, and so forth), then the rating of such debt
securities by each of Moody's and S&P shall be deemed to be the higher of the
two ratings; and (ii) if at any date the rating of any such senior unsecured
long term debt securities by Moody's shall be higher or lower than the
comparable rating by S&P by two or more rating levels (it being understood that
for these purposes an S&P rating of A+ is comparable to a Moody's rating of A1,
an S&P rating of A is comparable to a Moody's rating of A2, and so forth), then
the rating of such debt securities by each of Moody's and

                                       17
<PAGE>

S&P shall be deemed to be the comparable S&P and Moody's ratings at the midpoint
between the two actual ratings, or, if there shall be no rating at the midpoint,
the next higher rating from the midpoint between the two actual ratings. For
example, if such debt securities are rated BBB by S&P and Ba1 by Moody's, such
debt securities shall be deemed to be rated BBB- by S&P and Baa3 by Moody's; and
if such debt securities are rated BBB+ by S&P and Ba1 by Moody's, such debt
securities shall be deemed to be rated BBB by S&P and Baa2 by Moody's.

                                  ARTICLE II

                                  THE CREDITS

     SECTION 2.01. Commitments to Lend. During the period from and including the
                   -------------------
Effective Date to but excluding the Termination Date, each Bank severally
agrees, on the terms and conditions set forth in this Agreement, to make loans
to the Borrower pursuant to this Section from time to time in amounts such that
the aggregate principal amount of Committed Loans by such Bank at any one time
outstanding shall not exceed the amount of its Commitment. Each Borrowing under
this Section shall be in an aggregate principal amount of $10,000,000 or any
larger multiple of $1,000,000 (except that any such Borrowing may be in the
aggregate amount available in accordance with Section 3.02(b)) and shall be made
from the several Banks ratably in proportion to their respective Commitments.
Within the foregoing limits, the Borrower may borrow under this Section, repay,
or to the extent permitted by Section 2.11, prepay Loans and reborrow at any
time prior to the Termination Date under this Section.

     SECTION 2.02. Notice of Committed Borrowing. The Borrower shall give the
                   -----------------------------
Agent notice (a "Notice of Committed Borrowing") not later than 10:00 A.M. (New
York City time) on (x) the date of each Base Rate Borrowing, (y) the second
Domestic Business Day before each CD Borrowing and (z) the third Euro-Dollar
Business Day before each Euro-Dollar Borrowing, specifying:

     (a) the date of such Borrowing, which shall be a Domestic Business Day in
  the case of a Domestic Borrowing or a Euro-Dollar Business Day in the case of
  a Euro-Dollar Borrowing,

                                       18
<PAGE>

     (b) the aggregate amount of such Borrowing,

     (c) whether the Loans comprising such Borrowing are to be CD Loans, Base
  Rate Loans or Euro-Dollar Loans, and

     (d) in the case of a Fixed Rate Borrowing, the duration of the Interest
  Period applicable thereto, subject to the provisions of the definition of
  Interest Period.

     SECTION 2.03.  Money Market Borrowings.
                    -----------------------

     (a) The Money Market Option. In addition to Borrowings pursuant to Section
         -----------------------
2.01, the Borrower may, as set forth in this Section, request the Banks at any
time prior to the Termination Date to make offers to make Money Market Loans to
the Borrower. The Banks may, but shall have no obligation to, make such offers
and the Borrower may, but shall have no obligation to, accept any such offers in
the manner set forth in this Section.

     (b) Money Market Quote Request. When the Borrower wishes to request offers
         --------------------------
to make Money Market Loans under this Section, it shall transmit to the Agent by
telex or facsimile transmission a Money Market Quote Request substantially in
the form of Exhibit B hereto so as to be received no later than 10:00 A.M. (New
York City time) on (x) the fifth Euro-Dollar Business Day prior to the date of
Borrowing proposed therein, in the case of a LIBOR Auction or (y) the Domestic
Business Day next preceding the date of Borrowing proposed therein, in the case
of an Absolute Rate Auction (or, in either case, such other time or date as the
Borrower and the Agent shall have mutually agreed and shall have notified to the
Banks not later than the date of the Money Market Quote Request for the first
LIBOR Auction or Absolute Rate Auction for which such change is to be effective)
specifying:

                (i)  the proposed date of Borrowing, which shall be a Euro-
            Dollar Business Day in the case of a LIBOR Auction or a Domestic
            Business Day in the case of an Absolute Rate Auction,

                (ii)  the aggregate amount of such Borrowing, which shall be
            $10,000,000 or a larger multiple of $1,000,000,

                (iii)  the duration of the Interest Period applicable thereto,
            subject to the provisions of the

                                       19
<PAGE>

            definition of Interest Period, and

                (iv)  whether the Money Market Quotes requested are to set forth
            a Money Market Margin or a Money Market Absolute Rate.

The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within five Euro-Dollar Business Days (or such other
number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.

                 (c)  Invitation for Money Market Quotes.  Promptly upon receipt
                      ----------------------------------
of a Money Market Quote Request, the Agent shall send to the Banks by telex or
facsimile transmission an Invitation for Money Market Quotes substantially in
the form of Exhibit C hereto, which shall constitute an invitation by the
Borrower to each Bank to submit Money Market Quotes offering to make the Money
Market Loans to which such Money Market Quote Request relates in accordance with
this Section.

                 (d)  Submission and Contents of Money Market Quotes.  (i)  Each
                      ----------------------------------------------
Bank may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes. Each Money
Market Quote must comply with the requirements of this subsection (d) and must
be submitted to the Agent by telex or facsimile transmission at its offices
specified in or pursuant to Section 9.01 not later than (x) 2:00 P.M. (New York
City time) on the fourth Euro-Dollar Business Day prior to the proposed date of
Borrowing, in the case of a LIBOR Auction or (y) 9:15 A.M. (New York City time)
on the proposed date of Borrowing, in the case of an Absolute Rate Auction (or,
in either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date of
the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective); provided that Money Market
                                                   --------
Quotes submitted by the Agent (or any affiliate of the Agent) in the capacity of
a Bank may be submitted, and may only be submitted, if the Agent or such
affiliate notifies the Borrower of the terms of the offer or offers contained
therein not later than (x) one hour prior to the deadline for the other Banks,
in the case of a LIBOR Auction or (y) 15 minutes prior to the deadline for the
other Banks, in the case of an Absolute Rate Auction. Subject to Articles III
and VI, any Money Market Quote so made shall be irrevocable except with the
written consent of the Agent given on the instructions of

                                       20
<PAGE>

the Borrower.

                 (ii)  Each Money Market Quote shall be in substantially the
form of Exhibit D hereto and shall in any case specify:

                  (A)  the proposed date of Borrowing,

                  (B) the principal amount of the Money Market Loan for which
        each such offer is being made, which principal amount (w) may be greater
        than or less than the Commitment of the quoting Bank, (x) must be
        $5,000,000 or a larger multiple of $1,000,000, (y) may not exceed the
        principal amount of Money Market Loans for which offers were requested
        and (z) may be subject to an aggregate limitation as to the principal
        amount of Money Market Loans for which offers being made by such quoting
        Bank may be accepted,

                  (C) in the case of a LIBOR Auction, the margin above or below
        the applicable London Interbank Offered Rate (the "Money Market Margin")
        offered for each such Money Market Loan, expressed as a percentage
        (specified to the nearest 1/10,000th of 1%) to be added to or subtracted
        from such base rate,

                  (D) in the case of an Absolute Rate Auction, the rate of
        interest per annum (specified to the nearest 1/10,000th of 1%) (the
        "Money Market Absolute Rate") offered for each such Money Market Loan,
        and

                  (E)  the identity of the quoting Bank.

A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.

                  (iii)  Any Money Market Quote shall be disregarded if it:

                  (A) is not substantially in conformity with Exhibit D hereto
        or does not specify all of the information required by subsection
        (d)(ii);

                  (B)  contains qualifying, conditional or similar language;

                  (C)  proposes terms other than or in addition to those set
        forth in the applicable Invitation for Money Market Quotes; or

                                       21
<PAGE>

                  (D)  arrives after the time set forth in subsection (d)(i).

                  (e)  Notice to Borrower.  The Agent shall promptly notify the
                       ------------------
Borrower of the terms (x) of any Money Market Quote submitted by a Bank that is
in accordance with subsection (d) and (y) of any Money Market Quote that amends,
modifies or is otherwise inconsistent with a previous Money Market Quote
submitted by such Bank with respect to the same Money Market Quote Request. Any
such subsequent Money Market Quote shall be disregarded by the Agent unless such
subsequent Money Market Quote is submitted solely to correct a manifest error in
such former Money Market Quote. The Agent's notice to the Borrower shall specify
(A) the aggregate principal amount of Money Market Loans for which offers have
been received for each Interest Period specified in the related Money Market
Quote Request, (B) the respective principal amounts and Money Market Margins or
Money Market Absolute Rates, as the case may be, so offered and (C) if
applicable, limitations on the aggregate principal amount of Money Market Loans
for which offers in any single Money Market Quote may be accepted.

                 (f)  Acceptance and Notice by Borrower.  Not later than 10:00
                      ---------------------------------
A.M. (New York City time) on (x) the third Euro-Dollar Business Day prior to the
proposed date of Borrowing, in the case of a LIBOR Auction or (y) the proposed
date of Borrowing, in the case of an Absolute Rate Auction (or, in either case,
such other time or date as the Borrower and the Agent shall have mutually agreed
and shall have notified to the Banks not later than the date of the Money Market
Quote Request for the first LIBOR Auction or Absolute Rate Auction for which
such change is to be effective), the Borrower shall notify the Agent of its
acceptance or non-acceptance of the offers so notified to it pursuant to
subsection (e). In the case of acceptance, such notice (a "Notice of Money
Market Borrowing") shall specify the aggregate principal amount of offers for
each Interest Period that are accepted. The Borrower may accept any Money Market
Quote in whole or in part; provided that:
                           --------

                (i)  the aggregate principal amount of each Money Market
            Borrowing may not exceed the applicable amount set forth in the
            related Money Market Quote Request,

                (ii)  the principal amount of each Money Market Borrowing must
            be $10,000,000 or a larger multiple of $1,000,000,

                (iii)  acceptance of offers may only be made on the

                                       22
<PAGE>

            basis of ascending Money Market Margins or Money Market Absolute
            Rates, as the case may be, and

                (iv)  the Borrower may not accept any offer that is described in
            subsection (d)(iii) or that otherwise fails to comply with the
            requirements of this Agreement.

                (g)  Allocation by Agent.  If offers are made by two or more
                     -------------------
Banks with the same Money Market Margins or Money Market Absolute Rates, as the
case may be, for a greater aggregate principal amount than the amount in respect
of which such offers are accepted for the related Interest Period, the principal
amount of Money Market Loans in respect of which such offers are accepted shall
be allocated by the Agent among such Banks as nearly as possible (in multiples
of $1,000,000, as the Agent may deem appropriate) in proportion to the aggregate
principal amounts of such offers. Determinations by the Agent of the amounts of
Money Market Loans shall be conclusive in the absence of manifest error.

                  SECTION 2.04.  Notice to Banks; Funding of Loans.
                                 ---------------------------------
                 (a) Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Bank of the contents thereof and of such Bank's share (if
any) of such Borrowing and such Notice of Borrowing shall not thereafter be
revocable by the Borrower.

                 (b)  Not later than 12:00 Noon (New York City time) on the date
of each Borrowing, each Bank participating therein shall (except as provided in
subsection (c) of this Section) make available its share of such Borrowing, in
Federal or other funds immediately available in New York City, to the Agent at
its address referred to in Section 9.01. Unless the Agent determines that any
applicable condition specified in Article III has not been satisfied, the Agent
will make the funds so received from the Banks available to the Borrower at the
Agent's aforesaid address.

                 (c) If any Bank makes a new Loan hereunder on a day on which
the Borrower is to repay all or any part of an outstanding Loan from such Bank,
such Bank shall apply the proceeds of its new Loan to make such repayment and
only an amount equal to the difference (if any) between the amount being
borrowed and the amount being repaid shall be made available by such Bank to the
Agent as provided in subsection (b), or remitted by the Borrower to the Agent as
provided in Section 2.12, as the case may be.

                                       23
<PAGE>

                 (d) Unless the Agent shall have received notice from a Bank
prior to the date of any Borrowing that such Bank will not make available to the
Agent such Bank's share of such Borrowing, the Agent may assume that such Bank
has made such share available to the Agent on the date of such Borrowing in
accordance with subsections (b) and (c) of this Section 2.04 and the Agent may,
in reliance upon such assumption, make available to the Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so made
such share available to the Agent, such Bank and the Borrower severally agree to
repay to the Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available to
the Borrower until the date such amount is repaid to the Agent, at (i) in the
case of the Borrower, a rate per annum equal to the higher of the Federal Funds
Rate and the interest rate applicable thereto pursuant to Section 2.07 and (ii)
in the case of such Bank, the Federal Funds Rate. If such Bank shall repay to
the Agent such corresponding amount, such amount so repaid shall constitute such
Bank's Loan included in such Borrowing for purposes of this Agreement.

                 SECTION 2.05. Notes. (a) The Loans of each Bank shall be
                               -----
evidenced by a single Note payable to the order of such Bank for the account of
its Applicable Lending Office in an amount equal to the aggregate unpaid
principal amount of such Bank's Loans.

                 (b) Each Bank may, by notice to the Borrower and the Agent,
request that its Loans of a particular type be evidenced by a separate Note in
an amount equal to the aggregate unpaid principal amount of such Loans. Each
such Note shall be in substantially the form of Exhibit A hereto with
appropriate modifications to reflect the fact that it evidences solely Loans of
the relevant type. Each reference in this Agreement to the "Note" of such Bank
shall be deemed to refer to and include any or all of such Notes, as the context
may require.

                 (c) Upon receipt of each Bank's Note pursuant to Section
3.01(b), the Agent shall mail such Note to such Bank. Each Bank shall record the
date, amount, type and maturity of each Loan made by it and the date and amount
of each payment of principal made by the Borrower with respect thereto, and
prior to any transfer of its Note shall endorse on the schedule forming a part
thereof appropriate notations to evidence the foregoing information with respect
to each such Loan then outstanding; provided that the failure of any Bank to
                                    --------
make any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under

                                       24
<PAGE>

the Notes. Each Bank is hereby irrevocably authorized by the Borrower so to
endorse its Note and to attach to and make a part of its Note a continuation of
any such schedule as and when required.

                 SECTION 2.06. Maturity of Loans. Each Loan included in any
                               -----------------
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing.

                 SECTION 2.07. Interest Rates. (a) Each Base Rate Loan shall
                               --------------
bear interest on the outstanding principal amount thereof, for each day from the
date such Loan is made until it becomes due, at a rate per annum equal to the
Base Rate for such day. Such interest shall be payable for each Interest Period
on the last day thereof. Any overdue principal of or interest on any Base Rate
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the sum of 2% plus the rate otherwise applicable to Base Rate
Loans for such day.

                 (b) Each CD Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a rate
per annum equal to the sum of the Applicable Margin plus the applicable Adjusted
CD Rate; provided that if any CD Loan or any portion thereof shall, as a result
         --------
of clause (2)(b) of the definition of Interest Period, have an Interest Period
of less than 30 days, such portion shall bear interest during such Interest
Period at the rate applicable to Base Rate Loans during such period. Such
interest shall be payable for each Interest Period on the last day thereof and,
if such Interest Period is longer than 90 days, at intervals of 90 days after
the first day thereof. Any overdue principal of or interest on any CD Loan shall
bear interest, payable on demand, for each day until paid at a rate per annum
equal to the sum of 2% plus the higher of (i) the sum of the Applicable Margin
plus the Adjusted CD Rate applicable to such Loan and (ii) the rate applicable
to Base Rate Loans for such day.

                 The "Adjusted CD Rate" applicable to any Interest Period means
a rate per annum determined pursuant to the following formula:

                                       25
<PAGE>

                           [ CDBR       ]*
                  ACDR  =  [ ---------- ]  + AR
                           [ 1.00 - DRP ]

                  ACDR  =  Adjusted CD Rate
                  CDBR  =  CD Base Rate
                   DRP  =  Domestic Reserve Percentage
                    AR  =  Assessment Rate

__________
* The amount in brackets being rounded upward, if necessary, to the next higher
1/100 of 1%

                 The "CD Base Rate" applicable to any Interest Period is the
rate of interest determined by the Agent to be the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum bid
at 10:00 A.M. (New York City time) (or as soon thereafter as practicable) on the
first day of such Interest Period by two or more New York certificate of deposit
dealers of recognized standing for the purchase at face value from each CD
Reference Bank of its certificates of deposit in an amount comparable to the
principal amount of the CD Loan of such CD Reference Bank to which such Interest
Period applies and having a maturity comparable to such Interest Period.

                 "Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of new nonpersonal time deposits in dollars in New York City having a
maturity comparable to the related Interest Period and in an amount of $100,000
or more. The Adjusted CD Rate shall be adjusted automatically on and as of the
effective date of any change in the Domestic Reserve Percentage.

                 "Assessment Rate" means for any day the annual assessment rate
in effect on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. (S) 327.3(e) (or any successor provision) to the Federal Deposit
Insurance Corporation (or any successor) for such Corporation's (or such
successor's)

                                       26
<PAGE>

insuring time deposits at offices of such institution in the United States. The
Adjusted CD Rate shall be adjusted automatically on and as of the effective date
of any change in the Assessment Rate.

                 (c) Each Euro-Dollar Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Applicable Margin plus the
applicable London Interbank Offered Rate. Such interest shall be payable for
each Interest Period on the last day thereof and, if such Interest Period is
longer than three months, at intervals of three months after the first day
thereof.

                 The "London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if necessary, to the next higher 1/16
of 1%) of the respective rates per annum at which deposits in dollars are
offered to each of the Euro-Dollar Reference Banks in the London interbank
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business Days
before the first day of such Interest Period in an amount approximately equal to
the principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference Bank
to which such Interest Period is to apply and for a period of time comparable to
such Interest Period.

                 (d) Any overdue principal of or interest on any Euro-Dollar
Loan shall bear interest, payable on demand, for each day from and including the
date payment thereof was due to but excluding the date of actual payment, at a
rate per annum equal to the sum of 2% plus the higher of (i) the sum of the
Applicable Margin plus the London Interbank Offered Rate applicable to such Loan
and (ii) the Applicable Margin plus the quotient obtained (rounded upward, if
necessary, to the next higher 1/100 of 1%) by dividing (x) the average (rounded
upward, if necessary, to the next higher 1/16 of 1%) of the respective rates per
annum at which one day (or, if such amount due remains unpaid more than three
Euro-Dollar Business Days, then for such other period of time not longer than
six months as the Agent may select) deposits in dollars in an amount
approximately equal to such overdue payment due to each of the Euro-Dollar
Reference Banks are offered to such Euro-Dollar Reference Bank in the London
interbank market for the applicable period determined as provided above by (y)
1.00 minus the Euro-Dollar Reserve Percentage (or, if the circumstances
described in clause (a) or (b) of Section 8.01 shall exist, at a rate per annum
equal to the sum of 2% plus the rate applicable to Base Rate Loans for such
day).

                 (e)  Subject to Section 8.01(a), each Money Market

                                       27
<PAGE>

LIBOR Loan shall bear interest on the outstanding principal amount thereof, for
the Interest Period applicable thereto, at a rate per annum equal to the sum of
the London Interbank Offered Rate for such Interest Period (determined in
accordance with Section 2.07(c) as if the related Money Market LIBOR Borrowing
were a Committed Euro-Dollar Borrowing) plus (or minus) the Money Market Margin
quoted by the Bank making such Loan in accordance with Section 2.03. Each Money
Market Absolute Rate Loan shall bear interest on the outstanding principal
amount thereof, for the Interest Period applicable thereto, at a rate per annum
equal to the Money Market Absolute Rate quoted by the Bank making such Loan in
accordance with Section 2.03. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than three
months, at intervals of three months after the first day thereof. Any overdue
principal of or interest on any Money Market Loan shall bear interest, payable
on demand, for each day until paid at a rate per annum equal to the sum of 2%
plus the Base Rate for such day.

                 (f) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt notice to the Borrower and the
participating Banks of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.

                 (g) Each Reference Bank agrees to use its best efforts to
furnish quotations to the Agent as contemplated by this Section. If any
Reference Bank does not furnish a timely quotation, the Agent shall determine
the relevant interest rate on the basis of the quotation or quotations furnished
by the remaining Reference Bank or Banks or, if none of such quotations is
available on a timely basis, the provisions of Section 8.01 shall apply.

                 (h) The "Applicable Margin" with respect to any Euro-Dollar
Loan or CD Loan at any date is the applicable percentage amount set forth in the
table below based on the Utilization and Status on such day:

                                       28
<PAGE>

<TABLE>
<CAPTION>
                          Level I   Level II   Level III   Level IV   Level V   Level VI   Level VII
                           Status    Status      Status     Status     Status    Status      Status
                          --------  ---------  ----------  ---------  --------  ---------  ----------
<S>                       <C>       <C>        <C>         <C>        <C>       <C>        <C>

     If Utilization
     is equal to or
     less than 50%:

     Euro-Dollar Loans     0.1600%    0.1800%     0.1950%    0.2000%   0.2250%    0.3500%     0.4000%

     CD Loans              0.2850%    0.3050%     0.3200%    0.3250%   0.3500%    0.4750%     0.5250%

     If Utilization is
     greater than 50%:

     Euro-Dollar Loans     0.2100%    0.2300%     0.2450%    0.2500%   0.2750%    0.4500%     0.5000%

     CD Loans              0.3350%    0.3550%     0.3700%    0.3750%   0.4000%    0.5750%     0.6250%

</TABLE>

                  SECTION 2.08.  Fees.

                 (a)  Facility Fee.  The Borrower shall pay to the Agent for the
                      ------------
account of the Banks ratably a facility fee at the rate of (i) 0.0650% per annum
for each day on which Level I Status shall exist, (ii) 0.0700% per annum for
each day on which Level II Status shall exist, (iii) 0.0800% per annum for each
day on which Level III Status shall exist and (iv) 0.1000% per annum for each
day on which Level IV Status shall exist, (v) 0.125% per annum for each day on
which Level V Status shall exist, (vi) 0.2000% per annum for each day on which
Level VI Status shall exist, and (vii) 0.2500% per annum for each day on which
Level VII shall exist. Such facility fee shall accrue for each day (i) from and
including the Effective Date to but excluding the Termination Date (or earlier
date of termination of the Commitments in their entirety), on the aggregate
amount of the Commitments (whether used or unused) and (ii) from and including
the Termination Date (or earlier date of termination of the Commitments in their
entirety) to but excluding the date the Loans shall be repaid in their entirety,
on the aggregate outstanding principal amount of the Loans.

                 (b)  Payments.  Accrued fees under this Section shall be
                      --------
payable quarterly on each March 1, June 1, September 1 and December 1 and upon
the date of termination of the Commitments in their entirety (and, if later, the
date the Loans shall be repaid in their entirety).

                 SECTION 2.09. Optional Termination or Reduction of Commitments.
                               ------------------------------------------------
The Borrower may, upon at least three Domestic Business Days' notice to the
Agent, (i) terminate the Commitments at any time, if no Loans are outstanding at
such time or (ii) ratably reduce from time to time by an aggregate amount of
$10,000,000 or any larger multiple of $1,000,000, the aggregate amount of the
Commitments in excess of the aggregate outstanding principal amount of the
Loans.

                                       29
<PAGE>

                 SECTION 2.10. Mandatory Termination of Commitments. The
                               ------------------------------------
Commitments shall terminate on the Termination Date, and any Loans then
outstanding (together with accrued interest thereon) shall be due and payable on
such date.

                 SECTION 2.11. Optional Prepayments. (a) The Borrower may (i)
                               --------------------
upon at least one Domestic Business Days' notice to the Agent, prepay any Base
Rate Borrowing (or any Money Market Borrowing bearing interest at the Base Rate
pursuant to Section 8.01(a)) or, subject to Section 2.13, any CD Borrowing and
(ii) upon at least three Euro-Dollar Business Days' notice to the Agent, subject
to Section 2.13, prepay any Euro-Dollar Borrowing, in whole at any time, or from
time to time in part in amounts aggregating $10,000,000 or any larger multiple
of $1,000,000, by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment. Each such optional
prepayment shall be applied to prepay ratably the Loans of the several Banks
included in such Borrowing.

                 (b) Except as provided in clause (i) of subsection (a) above,
the Borrower may not prepay all or any portion of the principal amount of any
Money Market Loan prior to the maturity thereof.

                 (c) Upon receipt of a notice of prepayment pursuant to this
Section, the Agent shall promptly notify each Bank of the contents thereof and
of such Bank's ratable share (if any) of such prepayment and such notice shall
not thereafter be revocable by the Borrower.

                 SECTION 2.12. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on, the Loans and
of fees hereunder, not later than 12:00 Noon (New York City time) on the date
when due, in Federal or other funds immediately available in New York City, to
the Agent at its address referred to in Section 9.01. The Agent will promptly
distribute to each Bank its ratable share of each such payment received by the
Agent for the account of the Banks. Whenever any payment of principal of, or
interest on, the Domestic Loans or of fees shall be due on a day which is not a
Domestic Business Day, the date for payment thereof shall be extended to the
next succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a Euro-
Dollar Business Day, the date for payment thereof shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day falls
in another calendar month, in which case the date

                                       30
<PAGE>

for payment thereof shall be the next preceding Euro-Dollar Business Day.
Whenever any payment of principal of, or interest on, the Money Market Loans
shall be due on a day which is not a Euro-Dollar Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Dollar Business
Day. If the date for any payment of principal is extended by operation of law or
otherwise, interest thereon shall be payable for such extended time.

                 (b) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Banks hereunder
that the Borrower will not make such payment in full, the Agent may assume that
the Borrower has made such payment in full to the Agent on such date and the
Agent may, in reliance upon such assumption, cause to be distributed to each
Bank on such due date an amount equal to the amount then due such Bank. If and
to the extent that the Borrower shall not have so made such payment, each Bank
shall repay to the Agent forthwith on demand such amount distributed to such
Bank together with interest thereon, for each day from the date such amount is
distributed to such Bank until the date such Bank repays such amount to the
Agent, at the Federal Funds Rate.

                 SECTION 2.13. Funding Losses. If the Borrower makes any payment
                               --------------
of principal with respect to any Fixed Rate Loan (pursuant to Section 2.11 or
Article VI or VIII or otherwise) on any day other than the last day of the
Interest Period applicable thereto, or the last day of an applicable period
fixed pursuant to Section 2.07(d), or if the Borrower fails to borrow any Fixed
Rate Loans after notice has been given to any Bank in accordance with Section
2.04(a), or if the Borrower fails to prepay after giving notice thereof under
Section 2.11, the Borrower shall reimburse each Bank within 15 days after demand
for any resulting loss or expense incurred by it (or by an existing or
prospective Participant in the related Loan), including (without limitation) any
loss incurred in obtaining, liquidating or employing deposits from third
parties, but excluding loss of margin for the period after any such payment or
failure to borrow, provided that such Bank shall have delivered to the Borrower
                   --------
a certificate as to the amount of such loss or expense, which certificate shall
be conclusive in the absence of manifest error.

                 SECTION 2.14. Computation of Interest and Fees. Interest based
                               --------------------------------
on the Prime Rate hereunder and fees shall be computed on the basis of a year of
365 days (or 366 days in a leap year) and paid for the actual number of days
elapsed (including the first day but excluding the last day). All other interest
shall be computed on the basis of a year of

                                       31
<PAGE>

360 days and paid for the actual number of days elapsed (including the first day
but excluding the last day).

                 SECTION 2.15. Withholding Tax Exemption. At least five Domestic
                               -------------------------
Business Days prior to the first date on which interest or fees are payable
hereunder for the account of any Bank, each Bank that is not incorporated under
the laws of the United States of America or a state thereof agrees that it will
deliver to each of the Borrower and the Agent two duly completed copies of
United States Internal Revenue Service Form 1001 or 4224, certifying in either
case that such Bank is entitled to receive payments under this Agreement and the
Notes without deduction or withholding of any United States federal income
taxes. Each Bank which so delivers a Form 1001 or 4224 further undertakes to
deliver to each of the Borrower and the Agent two additional copies of such form
(or a successor form) on or before the date that such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the most
recent form so delivered by it, and such amendments thereto or extensions or
renewals thereof as may be reasonably requested by the Borrower or the Agent, in
each case certifying that such Bank is entitled to receive payments under this
Agreement and the Notes without deduction or withholding of any United States
federal income taxes, unless an event (including without limitation any change
in treaty, law or regulation) has occurred prior to the date on which any such
delivery would otherwise be required which renders all such forms inapplicable
or which would prevent such Bank from duly completing and delivering any such
form with respect to it and such Bank advises the Borrower and the Agent that it
is not capable of receiving payments without any deduction or withholding of
United States federal income tax.

                 SECTION 2.16. Regulation D Compensation. For so long as any
                               -------------------------
Bank maintains reserves against "Eurocurrency liabilities" (or any other
category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
such Bank to United States residents), and as a result the cost to such Bank (or
its Euro-Dollar Lending Office) of making or maintaining its Euro-Dollar Loans
is increased, then such Bank may require the Borrower to pay, contemporaneously
with each payment of interest on the Euro-Dollar Loans, additional interest on
the related Euro-Dollar Loan of such Bank at a rate per annum up to but not
exceeding the excess of (i) (A) the applicable London Interbank Offered Rate
divided by (B) one minus the Euro-Dollar Reserve Percentage over (ii) the
                   -----

                                       32
<PAGE>

applicable London Interbank Offered Rate. Any Bank wishing to require payment of
such additional interest (x) shall so notify the Borrower and the Agent, in
which case such additional interest on the Euro-Dollar Loans of such Bank shall
be payable to such Bank at the place indicated in such notice with respect to
each Interest Period commencing at least three Euro-Dollar Business Days after
the giving of such notice and (y) shall furnish to the Borrower at least five
Euro-Dollar Business Days prior to each date on which interest is payable on the
Euro-Dollar Loans an officer's certificate setting forth the amount to which
such Bank is then entitled under this Section (which shall be consistent with
such Bank's good faith estimate of the level at which the related reserves are
maintained by it). Each such certificate shall be accompanied by such
information as the Borrower may reasonably request as to the computation set
forth therein.

                                  ARTICLE III

                                  CONDITIONS

                 SECTION 3.01. Effectiveness. This Agreement shall become
                               -------------
effective on the date that each of the following conditions shall have been
satisfied (or waived in accordance with Section 9.05):

                  (a)  receipt by the Agent of counterparts hereof signed by
            each of the parties hereto (or, in the case of any party as to which
            an executed counterpart shall not have been received, receipt by the
            Agent in form satisfactory to it of telegraphic, telex or other
            written confirmation from such party of execution of a counterpart
            hereof by such party);

                  (b)  receipt by the Agent for the account of each Bank of a
            duly executed Note dated on or before the Effective Date complying
            with the provisions of Section 2.05;

                  (c)  receipt by the Agent of an opinion of Kevin J. Tierney,
            Esq., General Counsel of the Borrower, substantially in the form of
            Exhibit E hereto and covering such additional matters relating to
            the transactions contemplated hereby as the Required Banks may
            reasonably request;

                  (d)  receipt by the Agent of an opinion of Davis

                                       33
<PAGE>

            Polk & Wardwell, special counsel for the Agent, substantially in the
            form of Exhibit F hereto and covering such additional matters
            relating to the transactions contemplated hereby as the Required
            Banks may reasonably request;

                  (e)  receipt by the Agent of evidence satisfactory to it of
            the payment of all principal of and interest on any loans
            outstanding under, and of all other amounts payable under, the
            Credit Agreement dated as of December 13, 1994, as amended, among
            the Borrower, the banks listed on the signature pages thereof and
            Morgan Guaranty Trust Company of New York, as agent (the "Existing
            Credit Agreement"); and

                  (f)  receipt by the Agent of all documents it may reasonably
            request relating to the existence of the Borrower, the corporate
            authority for and the validity and enforceability of this Agreement
            and the Notes, and any other matters relevant hereto, all in form
            and substance satisfactory to the Agent;

provided that this Agreement shall not become effective or be binding on any
--------
party hereto unless all of the foregoing conditions are satisfied not later than
November 30, 1996. The Agent shall promptly notify the Borrower and the Banks of
the Effective Date, and such notice shall be conclusive and binding on all
parties hereto. The Banks that are parties to the Existing Credit Agreement,
comprising the "Required Banks" as defined therein, and the Borrower agree that
the commitments under the Existing Credit Agreement shall terminate in their
entirety simultaneously with and subject to the effectiveness of this Agreement
and that the Borrower shall be obligated to pay the accrued facility fees
thereunder to but excluding the date of such effectiveness.

                  SECTION 3.02. Borrowings. The obligation of any Bank to make a
                                ----------
Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:

                  (a)  receipt by the Agent of a Notice of Borrowing as required
            by Section 2.02 or 2.03, as the case may be;

                  (b)  the fact that, immediately after such Borrowing, the
            aggregate outstanding principal amount of the Loans will not exceed
            the aggregate amount of the Commitments;

                  (c)  the fact that, immediately before and after such
            Borrowing, no Default shall have occurred and be

                                       34
<PAGE>

            continuing; and

                  (d)  the fact that, except for the representations and
            warranties contained in Section 4.04(g) as of any date other than
            the Effective Date, the representations and warranties of the
            Borrower contained in this Agreement (and except, in the case of a
            Refunding Borrowing, the representations and warranties set forth in
            Section 4.05 as to any matter which has theretofore been disclosed
            in writing by the Borrower to the Banks) shall be true on and as of
            the date of such Borrowing.

       Each Borrowing hereunder shall be deemed to be a representation and
       warranty by the Borrower on the date of such Borrowing as to the facts
       specified in clauses (b), (c) and (d) of this Section.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

                 The Borrower represents and warrants that:

                 SECTION 4.01. Corporate Existence and Power. The Borrower is a
                               -----------------------------
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.

                 SECTION 4.02. Corporate and Governmental Authorization; No
                               --------------------------------------------
Contravention. The execution, delivery and performance by the Borrower of this
-------------
Agreement and the Notes (1) are within the Borrower's corporate powers, have
been duly authorized by all necessary corporate action, require no action by or
in respect of, or filing with, any governmental body, agency or official, (2) do
not contravene, or constitute a default under, any provision of applicable law
or regulation or of the certificate of incorporation or by-laws of the Borrower
or any Restricted Subsidiary or of any agreement, judgment, injunction, order,
decree or other instrument binding upon the Borrower or any Restricted
Subsidiary or result in the creation or imposition of any Lien on any asset of
the Borrower or any Restricted Subsidiary and (3) do not contravene, or
constitute a default under, any provision of applicable law or regulation or of
the certificate of incorporation or by-

                                       35
<PAGE>

laws of any Unrestricted Subsidiary or of any agreement, judgment, injunction,
order, decree or other instrument binding upon any Unrestricted Subsidiary or
result in the creation or imposition of any Lien on any asset of any
Unrestricted Subsidiary, where there is a reasonable possibility that such
contravention or default or creation or imposition of a Lien, together with any
contraventions and/or defaults and/or Liens so created or imposed and in each
case referred to in clauses (1) through (3), inclusive, above, could materially
adversely affect the business, consolidated financial position or consolidated
results of operations of the Borrower and the Restricted Subsidiaries, taken as
a whole.

                 SECTION 4.03. Binding Effect. This Agreement constitutes a
                               --------------
valid and binding agreement of the Borrower and the Notes, when executed and
delivered in accordance with this Agreement, will constitute valid and binding
obligations of the Borrower.

                  SECTION 4.04.  Financial Information.
                                 ---------------------

                 (a) The consolidated statements of income, stockholders' equity
and of cash flows of the Borrower and the Restricted Subsidiaries for the fiscal
year ended December 31, 1995 and the related consolidated balance sheets as at
the end of such period, a copy of which has been delivered to each of the Banks,
fairly present, in all material respects and in conformity with generally
accepted accounting principles, the consolidated financial condition of the
Borrower and the Restricted Subsidiaries as of such date and their consolidated
results of operations and cash flows for such period.

                 (b) The consolidated statements of income and of cash flows of
the Borrower and the Restricted Subsidiaries for the six months ended June 30,
1996 and the related consolidated balance sheets as at the end of such period, a
copy of which has been delivered to each of the Banks, fairly present, in all
material respects and in conformity with generally accepted accounting
principles applied on a basis consistent with the financial statements referred
to in subsection (a) above, the consolidated financial condition of the Borrower
and the Restricted Subsidiaries as of such date and their consolidated results
of operations and cash flows for such six-month period (subject to normal year-
end adjustments).

                 (c) The consolidated statements of income, stockholders' equity
and of cash flows of the Borrower and the Consolidated Subsidiaries for the
fiscal year ended

                                       36
<PAGE>

December 31, 1995 and the related consolidated balance sheets as at the end of
such period, reported on by Ernst & Young and set forth in the Borrower's 1995
Form 10-K, a copy of which has been delivered to each of the Banks, fairly
present, in all material respects and in conformity with generally accepted
accounting principles, the consolidated financial condition of the Borrower and
the Consolidated Subsidiaries as of such date and their consolidated results of
operations and cash flows for such period.

                 (d) The consolidated statements of income and of cash flows of
the Borrower and the Consolidated Subsidiaries for the six months ended June 30,
1996 and the related consolidated balance sheets as at the end of such period,
set forth in the Borrower's quarterly report for the fiscal quarter ended June
30, 1996 as filed with the Securities and Exchange Commission on Form 10-Q, a
copy of which has been delivered to each of the Banks, fairly present, in all
material respects and in conformity with generally accepted accounting
principles applied on a basis consistent with the financial statements referred
to in subsection (c) above, the consolidated financial condition of the Borrower
and the Consolidated Subsidiaries as of such date and their consolidated results
of operations and cash flows for such six-month period (subject to normal year-
end adjustments).

                 (e) The Annual Statement of each Restricted Insurance
Subsidiary for the fiscal year ended December 31, 1995, as filed with the
Applicable Insurance Regulatory Authority of such Restricted Insurance
Subsidiary, a copy of which has been delivered to each of the Banks, presents
the statutory financial condition of such Restricted Insurance Subsidiary in
accordance with statutory accounting practices required or permitted by such
Applicable Insurance Regulatory Authority, and the amounts carried in the
balance sheet referred to therein on account of the actuarial items referred to
in clauses (1) through (5), inclusive, of the statement of the Corporate Actuary
contained therein (i) are computed in accordance with commonly accepted
actuarial standards consistently applied and are fairly stated in accordance
with sound actuarial principles, (ii) are based on actuarial assumptions that
produce reserves at least as great as those called for in any contract provision
and are in accordance with all other contract provisions, (iii) meet the
requirements of the insurance laws and regulations of the State in which such
Restricted Insurance Subsidiary is domiciled, (iv) make a good and sufficient
provision for all unmatured obligations of such Restricted Insurance Subsidiary
guaranteed under the terms of its policies, (v) are computed on the basis of
assumptions consistent with those used in computing the corresponding items in
the

                                       37
<PAGE>

Annual Statement of such Restricted Insurance Subsidiary for the fiscal year
ended December 31, 1990, except as noted in the notes thereto and (vi) include
provisions for all actuarial reserves and related statement items that ought to
be established, and such actuarial methods, considerations and analyses conform
to the appropriate Standards of Practice as promulgated by the Actuarial
Standards Board, which standards form the basis of this statement of opinion.

                 (f) The Quarterly Statement of each Restricted Insurance
Subsidiary for the six months ended June 30, 1996, as filed with the Applicable
Insurance Regulatory Authority of such Restricted Insurance Subsidiary, a copy
of which has been delivered to each of the Banks, presents the statutory
financial condition of such Restricted Insurance Subsidiary in accordance with
statutory accounting practices required or permitted by such Applicable
Insurance Regulatory Authority.

                 (g) Since June 30, 1996 there has been no material adverse
change in the business, financial position, results of operations or prospects
of the Borrower and the Restricted Subsidiaries, considered as a whole.

                 SECTION 4.05. Litigation. There is no action, suit or
                               ----------
proceeding pending against, or to the knowledge of the Borrower threatened
against or affecting, the Borrower or any of its Subsidiaries before any court
or arbitrator or any governmental body, agency or official in which there is a
reasonable possibility of an adverse decision which could materially adversely
affect the business, consolidated financial position or consolidated results of
operations of the Borrower and the Restricted Subsidiaries, taken as a whole, or
which in any manner draws into question the validity or enforceability of this
Agreement or the Notes.

                 SECTION 4.06. Compliance with ERISA. Each member of the ERISA
                               ---------------------
Group has fulfilled its obligations under the minimum funding standards of ERISA
and the Internal Revenue Code with respect to each Plan and is in compliance in
all material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Internal Revenue Code or (iii)
incurred any liability

                                       38
<PAGE>

under Title IV of ERISA other than a liability to the PBGC for premiums under
Section 4007 of ERISA.

                 SECTION 4.07. Taxes. United States Federal income tax returns
                               -----
of the Borrower and its Subsidiaries have been examined and closed through the
fiscal year ended December 31, 1988. The Borrower and the Restricted
Subsidiaries have filed all United States Federal income tax returns and all
other material tax returns which are required to be filed by them and have paid
all taxes due pursuant to such returns or pursuant to any assessment received by
the Borrower or any Restricted Subsidiary. The charges, accruals and reserves on
the books of the Borrower and the Restricted Subsidiaries in respect of taxes or
other governmental charges are, in the opinion of the Borrower, adequate. There
has been no failure by any Unrestricted Subsidiary to file any tax return
required to be filed by it or to pay any tax when due which failure, together
with any other failures referred to in this Section 4.07, could materially
adversely affect the business, consolidated financial position or consolidated
results of operations of the Borrower and the Restricted Subsidiaries, taken as
a whole.

                 SECTION 4.08. Subsidiaries. Each of the Restricted Subsidiaries
                               ------------
is a corporation duly incorporated, validly existing and in good standing under
the laws of its jurisdiction of incorporation, and has all corporate powers and
all material governmental licenses, authorizations, consents and approvals
required to carry on its business as now conducted.

                 SECTION 4.09. Not an Investment Company. Neither the Borrower
                               -------------------------
nor any Restricted Subsidiary is an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.

                 SECTION 4.10. Full Disclosure. All information heretofore
                               ---------------
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower to the Agent or any
Bank will be, true and accurate in all material respects on the date as of which
such information is stated or certified. The Borrower has disclosed to the Banks
in writing any and all facts known to it which materially and adversely affect
or may affect (to the extent the Borrower can now reasonably foresee), the
business, operations or financial condition of the Borrower and the Restricted
Subsidiaries, taken as a whole, or the ability of the Borrower to perform its
obligations under this Agreement.

                                       39
<PAGE>

                                   ARTICLE V

                                   COVENANTS

                 The Borrower agrees that so long as any Bank has any Commitment
hereunder or any amount payable under any Note remains unpaid:

                 SECTION 5.01.  Financial Statements.  The Borrower shall
deliver to each of the Banks:

                 (a) as soon as available and in any event within 60 days after
            the end of each of the first three fiscal quarterly periods of each
            fiscal year of the Borrower, consolidated statements of income and
            of cash flows of the Borrower and the Restricted Subsidiaries for
            such period and for the period from the beginning of the respective
            fiscal year to the end of such period, and the related consolidated
            balance sheets as at the end of such period, setting forth in each
            case in comparative form the corresponding figures for the
            corresponding periods in the preceding fiscal year, accompanied by a
            certificate of a senior financial officer of the Borrower, which
            certificate shall state that said financial statements fairly
            present, in all material respects, the consolidated financial
            condition and results of operations and cash flows of the Borrower
            and the Restricted Subsidiaries in accordance with generally
            accepted accounting principles, consistently applied, as at the end
            of, and for, such periods (subject to normal year-end audit
            adjustments);

                 (b) as soon as available and in any event within 100 days
            after the end of each fiscal year of the Borrower, consolidated
            statements of income, stockholders' equity and of cash flows of the
            Borrower and the Restricted Subsidiaries for such year and the
            related consolidated balance sheets as at the end of such year,
            setting forth in each case in comparative form the corresponding
            figures for the preceding fiscal year, and accompanied by an opinion
            thereon of independent certified public accountants of recognized
            national standing, which opinion shall state that said financial
            statements fairly present, in all material respects, the
            consolidated financial condition and results of operations and cash
            flows of the Borrower and the Restricted Subsidiaries as at the end
            of, and

                                       40
<PAGE>

            for, such fiscal year, and a certificate of such accountants stating
            that, in making the audit necessary for their opinion, they obtained
            no knowledge, except as specifically stated, of any Default;

                  (c) as soon as available and in any event within 60 days after
            the end of each of the first three fiscal quarterly periods of each
            fiscal year of the Borrower, consolidated statements of income and
            of cash flows of the Borrower and the Consolidated Subsidiaries for
            such period and for the period from the beginning of the respective
            fiscal year to the end of such period, and the related consolidated
            balance sheets as at the end of such period, setting forth in each
            case in comparative form the corresponding figures for the
            corresponding periods in the preceding fiscal year, accompanied by a
            certificate of a senior financial officer of the Borrower, which
            certificate shall state that said financial statements fairly
            present, in all material respects, the consolidated financial
            condition and results of operations and cash flows of the Borrower
            and the Consolidated Subsidiaries in accordance with generally
            accepted accounting principles, consistently applied, as at the end
            of, and for, such periods (subject to normal year-end audit
            adjustments);

                  (d) as soon as available and in any event within 100 days
            after the end of each fiscal year of the Borrower, consolidated
            statements of income, stockholders' equity and of cash flows of the
            Borrower and the Consolidated Subsidiaries for such year and the
            related consolidated balance sheets as at the end of such year,
            setting forth in each case in comparative form the corresponding
            figures for the preceding fiscal year, and accompanied by an opinion
            thereon of independent certified public accountants of recognized
            national standing, which opinion shall state that said financial
            statements fairly present, in all material respects, the
            consolidated financial condition and results of operations and cash
            flows of the Borrower and the Consolidated Subsidiaries as at the
            end of, and for, such fiscal year;

                  (e) as soon as available and in any event not later than 90
            days after the end of each fiscal year of each Restricted Insurance
            Subsidiary, (i) the Annual Statements of such Restricted Insurance
            Subsidiary (prepared in accordance with the statutory accounting
            practices required or permitted by its Applicable Insurance
            Regulatory Authority) for such fiscal year as

                                       41
<PAGE>

            filed with such Applicable Insurance Regulatory Authority, together
            with the opinion thereon of a senior financial officer of such
            Restricted Insurance Subsidiary stating that such Annual Statements
            present the statutory financial condition of such Restricted
            Insurance Subsidiary in accordance with statutory accounting
            practices required or permitted by such Applicable Insurance
            Regulatory Authority, and (ii) a certificate of the Corporate
            Actuary of such Restricted Insurance Subsidiary affirming that the
            amounts carried in the balance sheet referred to therein on account
            of the actuarial items referred to in clauses (1) through (5),
            inclusive, of such certificate (i) are computed in accordance with
            commonly accepted actuarial standards consistently applied and are
            fairly stated in accordance with sound actuarial principles, (ii)
            are based on actuarial assumptions that produce reserves at least as
            great as those called for in any contract provision and are in
            accordance with all other contract provisions, (iii) meet the
            requirements of the insurance laws and regulations of the State in
            which such Restricted Insurance Subsidiary is domiciled, (iv) make a
            good and sufficient provision for all unmatured obligations of such
            Restricted Insurance Subsidiary guaranteed under the terms of its
            policies, (v) are computed on the basis of assumptions consistent
            with those used in computing the corresponding items in the Annual
            Statement of such Restricted Insurance Subsidiary for the preceding
            fiscal year, except as noted in the notes thereto and (vi) include
            provisions for all actuarial reserves and related statement items
            that ought to be established, and affirming that such actuarial
            methods, considerations and analyses conform to the appropriate
            Standards of Practice as promulgated by the Actuarial Standards
            Board, which Standards of Practice form the basis of this
            certification;

                  (f) as soon as available and in any event within 60 days after
            the end of each fiscal quarter of each Restricted Insurance
            Subsidiary (except for the fourth fiscal quarter of any fiscal
            year), (i) quarterly statutory financial statements of such
            Restricted Insurance Subsidiary (prepared in accordance with
            statutory accounting practices required or permitted by its
            Applicable Insurance Regulatory Authority) for such fiscal quarter
            as filed with such Applicable Insurance Regulatory Authority,
            together with the opinion thereon of a senior financial officer of
            such Restricted Insurance Subsidiary stating that such statutory
            financial statements present the statutory financial condition of
            such Restricted Insurance Subsidiary in

                                       42
<PAGE>

            accordance with statutory accounting practices required or permitted
            by such Applicable Insurance Regulatory Authority;

                  (g) promptly upon their becoming available, copies of all
            registration statements and regular periodic reports (including,
            without limitation, Form 8-K), if any, which the Borrower shall have
            filed with the Securities and Exchange Commission (or any
            governmental agency substituted therefor) or any national securities
            exchange;

                  (h) promptly upon the mailing thereof to the shareholders of
            the Borrower generally, copies of all financial statements, reports
            and proxy statements so mailed;

                  (i) if and when any member of the ERISA Group (i) gives or is
            required to give notice to the PBGC of any "reportable event" (as
            defined in Section 4043 of ERISA) with respect to any Plan which
            might constitute grounds for a termination of such Plan under Title
            IV of ERISA, or knows that the plan administrator of any Plan has
            given or is required to give notice of any such reportable event, a
            copy of the notice of such reportable event given or required to be
            given to the PBGC; (ii) receives notice of complete or partial
            withdrawal liability under Title IV of ERISA or notice that any
            Multiemployer Plan is in reorganization, is insolvent or has been
            terminated, a copy of such notice; (iii) receives notice from the
            PBGC under Title IV of ERISA of an intent to terminate, impose
            liability (other than for premiums under Section 4007 of ERISA) in
            respect of, or appoint a trustee to administer any Plan, a copy of
            such notice; (iv) applies for a waiver of the minimum funding
            standard under Section 412 of the Internal Revenue Code, a copy of
            such application; (v) gives notice of intent to terminate any Plan
            under Section 4041(c) of ERISA, a copy of such notice and other
            information filed with the PBGC; (vi) gives notice of withdrawal
            from any Plan pursuant to Section 4063 of ERISA, a copy of such
            notice; or (vii) fails to make any payment or contribution to any
            Plan or Multiemployer Plan or in respect of any Benefit Arrangement
            or makes any amendment to any Plan or Benefit Arrangement which has
            resulted or could result in the imposition of a Lien or the posting
            of a bond or other security, a certificate of the chief financial
            officer or the chief accounting officer of the Borrower setting
            forth details as to such occurrence and action, if any, which the
            Borrower or applicable member of the

                                       43
<PAGE>

            ERISA Group is required or proposes to take;

                  (j) promptly after the Borrower knows that any Default has
            occurred, a notice of such Default describing the same in reasonable
            detail and, together with such notice or as soon thereafter as
            possible, a description of the action that the Borrower as taken and
            proposes to take with respect thereto;

                  (k) promptly upon the occurrence of any change in the rating
            of any obligation of the Borrower by either Moody's or S&P, a notice
            setting forth the details thereof; and

                  (l) from time to time such other information regarding the
            business, affairs or financial condition of the Borrower or any of
            the Subsidiaries as the Agent, at the request of any Bank, may
            reasonably request, if the requesting Bank in good faith determines
            that such information is or may be necessary or useful to it to
            determine or monitor the Borrower's compliance with the provisions
            of this Agreement.

       The Borrower will furnish to each Bank, at the time it furnishes each set
of financial statements pursuant to paragraph (a), (b), (c) or (d) above, a
certificate of a senior financial officer of the Borrower (i) to the effect that
no Default has occurred and is continuing (or, if any Default has occurred and
is continuing, describing the same in reasonable detail and describing the
action that the Borrower has taken and proposes to take with respect thereto)
and (ii) setting forth in reasonable detail the computations necessary to
determine whether the Borrower is in compliance with Sections 5.08 and 5.09 as
of the end of the respective fiscal quarter or fiscal year.

                 SECTION 5.02. Litigation. The Borrower shall promptly give to
                               ----------
each Bank notice of all legal or arbitral actions, suits and proceedings, and of
all actions, suits and proceedings by or before any governmental or regulatory
authority or agency, affecting the Borrower or any Subsidiary, except actions,
suits and proceedings which in the aggregate, if adversely determined, would
not, in the judgment of the Borrower, have a material adverse effect on the
business, consolidated financial condition or consolidated results of operations
of the Borrower and the Restricted Subsidiaries, taken as a whole.

                 SECTION 5.03.  Corporate Existence, Etc.  Except as provided in
                                ------------------------
Section 5.05, the Borrower shall, and shall cause each Restricted Subsidiary to:
preserve and maintain

                                       44
<PAGE>

its corporate existence and all of its material rights, privileges and
franchises; comply with the requirements of all applicable laws, rules,
regulations and orders of governmental or regulatory authorities if failure to
comply with such requirements would materially and adversely affect the
consolidated financial condition or operations, or the business taken as a
whole, of the Borrower and the Restricted Subsidiaries; pay and discharge all
taxes, assessments and governmental charges or levies imposed on it or on its
income or profits or on any of its property prior to the date on which penalties
attach thereto, except for any such tax, assessment, charge or levy the payment
of which is being contested in good faith and by proper proceedings and against
which adequate reserves are being maintained; maintain all of its properties
used or useful in its business in good working order and condition, ordinary
wear and tear excepted; permit one or more representatives acting on behalf of
all of the Banks, during normal business hours, to examine, copy and make
extracts from its books and records, to inspect its properties, and to discuss
its business and affairs with its officers, all to the extent reasonably
requested by the Required Banks for the purposes described in Section 5.01(l),
provided that such representatives shall have the right to copy and make
--------
extracts from such books and records only after the occurrence and during the
continuance of a Default; and keep insured by financially sound and reputable
insurers all property of a character usually insured by corporations engaged in
the same or similar business similarly situated against loss or damage of the
kinds and in the amounts customarily insured against by such corporations and
carry such other insurance as is usually carried by such corporations and/or
self insure all property, in a manner and in amounts, in accordance with
generally accepted actuarial and accounting principles.

                 SECTION 5.04. Use of Proceeds. The Borrower shall use the
                               ---------------
proceeds of the Loans hereunder to finance general corporate activities
(including, without limitation, the repurchase of stock of the Borrower and the
purchase of stock of other companies) in compliance with all applicable legal
and regulatory requirements, including, without limitation, the Securities
Exchange Act of 1934, as amended, and the regulations promulgated thereunder,
including, without limitation, Regulations U and X.

                                       45
<PAGE>

                 SECTION 5.05. Prohibition of Fundamental Changes. The Borrower
                               ----------------------------------
shall not, nor shall it permit any Restricted Subsidiary to, enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), convey, sell, lease,
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or a substantial part of its business or assets, whether now
owned or hereafter acquired (including, without limitation, receivables and
leasehold interests, but excluding (i) any inventory or other assets sold or
disposed of in the ordinary course of business according to ordinary business
terms and (ii) obsolete or worn-out property) or make any material change in its
present method of conducting business except that:

                  (a) any Restricted Subsidiary may merge with or consolidate
            into (i) the Borrower if the Borrower shall be the surviving
            corporation or (ii) any other Restricted Subsidiary;

                  (b) any Restricted Subsidiary may sell, lease, transfer or
            otherwise dispose of any or all of its assets (upon voluntary
            liquidation or otherwise) to the Borrower or another Restricted
            Subsidiary;

                  (c) (I) the Borrower may merge with or consolidate into any
            other Person if the Borrower is the surviving corporation; (II) the
            Borrower may merge with or consolidate into any other Person where
            the Borrower is not the surviving corporation and may transfer
            substantially all its assets as an entirety to any other Person, if,
            but only if (i) the corporation into which the Borrower is merged or
            formed by such consolidation or the Person which acquires
            substantially all the Borrower's assets as an entirety is a
            corporation organized and existing under the laws of the United
            States or any State thereof, and shall expressly assume, by an
            agreement executed and delivered to the Agent and the Banks and in
            form and substance satisfactory to the Agent and the Banks, the due
            and punctual payment of the principal of, and interest on, all Loans
            then outstanding or thereafter made hereunder and the due and
            punctual payment of all other amounts then outstanding or thereafter
            required to be paid hereunder and the performance of every covenant
            and agreement contained herein, (ii) after giving effect to such
            merger, consolidation or transfer, no Default shall exist hereunder,
            (iii) the corporation referred to in clause (i) above shall have
            outstanding senior unsecured long-term Indebtedness

                                       46
<PAGE>

            rated at least A- by S&P and at least A3 by Moody's or, if no such
            Indebtedness is outstanding, the Borrower shall have provided
            written evidence from S&P and Moody's to the Banks, such evidence to
            be satisfactory to the Required Banks, that, if such corporation had
            such Indebtedness outstanding, such Indebtedness would be rated at
            least A- by S&P and at least A3 by Moody's and (iv) at the time of
            such merger, consolidation or transfer the Borrower and the
            Restricted Subsidiaries would be permitted to incur at least $1.00
            of additional Funded Indebtedness under Section 5.09, provided that
                                                                  --------
            no such transfer shall have the effect of releasing the Borrower
            from any of its obligations hereunder or under the Notes; and (III)
            a Restricted Subsidiary may merge or consolidate with or into or
            transfer substantially all its assets as an entirety to any other
            Person if the surviving or transferee corporation is or
            contemporaneously therewith becomes a Restricted Subsidiary;
            provided that in each case, after giving effect to such merger,
            --------
            consolidation or transfer, (i) no Default shall exist hereunder,
            (ii) the Borrower's outstanding senior unsecured long-term
            Indebtedness shall be rated at least A- by S&P and at least A3 by
            Moody's or, if no such Indebtedness is outstanding, if the Borrower
            provides written evidence from S&P and Moody's to the Banks, such
            evidence to be satisfactory to the Required Banks, to the effect
            that, if the Borrower had any such Indebtedness outstanding at such
            time, such Indebtedness would be rated at least A- by S&P and at
            least A3 by Moody's and (iii) the Borrower and the Restricted
            Subsidiaries would be permitted to incur at least $1.00 of
            additional Funded Indebtedness under Section 5.09;

                  (d) the Borrower or any Restricted Subsidiary may change its
            present lines of business or, in connection therewith, may abandon
            or otherwise dispose of any material rights, privileges and
            franchises, or its present method of conducting business if such
            change, abandonment or disposition will not, in the Borrower's Board
            of Directors' good faith judgment, have a material adverse effect on
            the business, operations, property, financial or other condition of
            the Borrower and the Restricted Subsidiaries, taken as a whole;

                  (e) the Borrower or any Restricted Subsidiary may, in any
            fiscal quarter of the Borrower, convey, sell, lease, transfer or
            otherwise dispose of assets (not otherwise permitted under this
            Section 5.05 to be disposed of) which, together with all other
            assets (not otherwise permitted under this Section 5.05 to be

                                       47
<PAGE>

            disposed of) theretofore so disposed of in such fiscal quarter and
            in the immediately preceding three consecutive fiscal quarters of
            the Borrower, have a book value not exceeding in the aggregate 20%
            of Total Assets as at the first day of such period of three
            consecutive fiscal quarters so long as (i) any such conveyance,
            sale, lease, transfer or other disposition, together with all such
            conveyances, sales, leases, transfers or other dispositions since
            the first day of such period of three consecutive fiscal quarters,
            will not, in the Borrower's Board of Directors' good faith judgment,
            have a material adverse effect on the business, operations, property
            or financial or other condition of the Borrower and the Restricted
            Subsidiaries, taken as a whole and (ii) after giving effect to such
            conveyance, sale, lease, transfer or other disposition, no Default
            exists and the Borrower and the Restricted Subsidiaries would be
            permitted to incur at least $1.00 of additional Funded Indebtedness
            under Section 5.09; provided that the aggregate book value of all
                                --------
            assets conveyed, sold, leased, transferred or otherwise disposed of
            during such fiscal quarter and the immediately preceding three
            consecutive fiscal quarters shall not exceed 10% of Total Assets as
            at such first day except to the extent that such assets were first
            acquired by the Borrower or any Restricted Subsidiary, taken
            together, not earlier than one year prior to such conveyance, sale,
            lease, transfer or other disposition; and

                  (f)  the Borrower or any Restricted Subsidiary may sell,
            lease, transfer or otherwise dispose of real property (and personal
            property necessary to the use thereof) acquired by the Borrower or
            such Restricted Subsidiary, as the case may be, pursuant to
            foreclosure proceedings or by deed in lieu of foreclosure;

provided that none of the foregoing shall prevent the Borrower or any Restricted
--------
Subsidiary from conveying, selling, leasing, transferring or otherwise disposing
of any Home Office Properties the fair market value of which in the aggregate
does not exceed $100,000,000.

                 SECTION 5.06. Limitation on Liens. The Borrower shall not, nor
                               -------------------
shall it permit any Restricted Subsidiary to, create, incur, assume or suffer to
exist, any Lien upon any of its property, assets or revenues, whether now owned
or hereafter acquired, except:

                  (a)  Liens, not otherwise excepted hereunder, existing on the
            date of this Agreement, which Liens do

                                       48
<PAGE>

            not secure Indebtedness in an aggregate principal amount in excess
            of $20,000,000;

                  (b)  Liens arising in the ordinary course of its business
            which (i) do not secure Indebtedness, (ii) in the case of any
            judgment or order for the payment of money, do not secure any
            judgment or order for the payment of money in an amount exceeding
            $10,000,000 and (iii) do not in the aggregate materially detract
            from the value of its assets or materially impair the use thereof in
            the operation of its business;

                  (c)  Liens on assets of corporations which become Restricted
            Subsidiaries after the date of this Agreement, provided that such
                                                           --------
            Liens are in existence at the time the respective corporations
            become Restricted Subsidiaries and were not created in anticipation
            thereof;

                  (d)  Liens upon real and/or tangible personal property
            acquired after the date hereof (by purchase, construction or
            otherwise) by the Borrower or any Restricted Subsidiary, each of
            which Liens either (A) existed on such property before the time of
            its acquisition and was not created in anticipation thereof, or (B)
            was created solely for the purpose of securing Indebtedness
            representing, or incurred to finance, refinance or refund, the cost
            (including the cost of construction) of the respective property;
            provided that no such Lien shall extend to or cover any property of
            --------
            the Borrower or such Restricted Subsidiary other than the respective
            property so acquired and improvements thereon and no such Lien shall
            secure any additional Indebtedness; and provided further that the
                                                    -------- -------
            principal amount of Indebtedness secured by any such Lien shall at
            no time exceed the cost of the respective property at the time it
            was acquired (by purchase, construction or otherwise);

                  (e)  Liens created after the Effective Date upon real and/or
            personal property securing Indebtedness incurred after the Effective
            Date, provided that the aggregate Indebtedness secured thereby shall
                  --------
            not at any time exceed 7.5% of Total Stockholders' Equity; and

                  (f)  any extension, renewal or replacement of the foregoing,

            provided, however, that the Liens permitted hereunder shall not
            --------  -------
            secure any additional Indebtedness (if applicable) or cover any
            additional property.

                 SECTION 5.07.  Transactions with Affiliates.  The
                                ----------------------------

                                       49
<PAGE>

       Borrower will not, nor will it permit any Restricted Subsidiary to,
       directly or indirectly, enter into any transaction with or for the
       benefit of any Affiliate (including, without limitation, transfers of
       assets to or from an Affiliate and guarantees and assumptions of
       obligations of an Affiliate) other than transactions with Affiliates (i)
       otherwise permitted by this Agreement or (ii) (x) entered into on an
       arm's length basis, on terms no more favorable to such Affiliate than
       would be available to unrelated Persons and (y) after giving effect to
       which the Borrower and the Restricted Subsidiaries would be permitted to
       incur at least $1.00 of additional Funded Indebtedness under Section
       5.09.

                 SECTION 5.08.  Minimum Total Stockholders' Equity.  The
                                ----------------------------------
       Borrower shall not permit at any time Total Stockholders' Equity to be
       less than 10% of Total Assets.

                 SECTION 5.09.  Ratio of Funded Indebtedness to Total Capital.
                                ---------------------------------------------
       The Borrower shall not, nor shall it permit any Restricted Subsidiary to,
       incur or otherwise become liable in respect of any Funded Indebtedness
       (including, without limitation the borrowing of Loans hereunder) unless,
       after giving effect thereto, the ratio of (i) the aggregate principal
       amount of Funded Indebtedness to (ii) Total Capital will not exceed 0.35
       to 1.

                 SECTION 5.10.  Restricted and Unrestricted Subsidiaries.  The
                                ----------------------------------------
       Borrower may at any time by resolution of its Board of Directors
       designate any Subsidiary prospectively as a Restricted Subsidiary or as
       an Unrestricted Subsidiary if, after giving effect to such designation,
       no Default would exist and the Borrower and the Restricted Subsidiaries
       would be permitted to incur at least $1.00 of additional Funded
       Indebtedness under Section 5.09; provided however, that no Subsidiary
                                        -------- -------
       designated by an asterisk on Schedule I hereof as a Restricted Subsidiary
       may be designated as an Unrestricted Subsidiary; provided further that,
                                                        -------- -------
       if any Unrestricted Subsidiary listed on Schedule I hereof is duly
       designated pursuant to this Section 5.10 as a Restricted Subsidiary, it
       may not at any time thereafter be designated as an Unrestricted
       Subsidiary; and provided further that any designation under this Section
                       -------- -------
       5.10 must remain unchanged over the last day of at least two consecutive
       fiscal quarters of the Borrower.  A certified copy of such resolution,
       together with a pro forma consolidated balance sheet of the Borrower and
       the Restricted Subsidiaries as at a date not more than 30 days prior to
       the effective date of (but giving effect to) such designation, shall be
       delivered to each Bank no later than five Domestic Business Days prior to
       the effective date of

                                       50
<PAGE>

       such designation.

                                   ARTICLE VI

                                    DEFAULTS

                 SECTION 6.01.  Events of Default.  If one or more of the
                                -----------------
       following events ("Events of Default") shall have occurred and be
       continuing:

                  (a)  the Borrower shall fail to pay when due any principal of
            any Loan, or the Borrower shall fail to pay within five days of the
            due date thereof any interest on any Loan, any fees or any other
            amount payable hereunder;

                  (b)  the Borrower shall fail to observe or perform any
            covenant contained in Sections 5.04 to 5.10, inclusive, provided
                                                                    --------
            that, if a failure to observe the covenant contained in Section 5.08
            occurs and, but only so long as, Total Stockholders' Equity is at
            least 7% of Total Assets, then the failure to observe such covenant
            shall not be an Event of Default unless such failure continues for
            30 days;

                  (c)  the Borrower shall fail to observe or perform any
            covenant or agreement contained in this Agreement (other than those
            covered by clause (a) or (b) above) for 30 days after written notice
            thereof has been given to the Borrower by the Agent at the request
            of any Bank;

                  (d)  any representation, warranty, certification or statement
            made by the Borrower in this Agreement or in any certificate,
            financial statement or other document delivered pursuant to this
            Agreement shall prove to have been incorrect in any material respect
            when made (or deemed made);

                  (e)  the Borrower or any Restricted Subsidiary or any
            Insurance Subsidiary shall fail to make any payment in respect of
            any Material Indebtedness when due or within any applicable grace
            period;

                  (f)  any event or condition shall occur which results in the
            acceleration of the maturity of any Material Indebtedness of the
            Borrower or any Restricted Subsidiary or any Insurance Subsidiary or
            enables the

                                       51
<PAGE>

            holder of such Material Indebtedness or any Person acting on such
            holder's behalf to accelerate the maturity thereof;

                  (g)  the Borrower or any Restricted Subsidiary or any
            Insurance Subsidiary shall commence a voluntary case or other
            proceeding seeking liquidation, reorganization or other relief with
            respect to itself or its debts under any bankruptcy, insolvency or
            other similar law now or hereafter in effect or seeking the
            appointment of a trustee, receiver, liquidator, custodian or other
            similar official of it or any substantial part of its property, or
            shall consent to any such relief or to the appointment of or taking
            possession by any such official in an involuntary case or other
            proceeding commenced against it, or shall make a general assignment
            for the benefit of creditors, or shall fail generally to pay its
            debts as they become due, or shall take any corporate action to
            authorize any of the foregoing;

                  (h)  an involuntary case or other proceeding shall be
            commenced against the Borrower or any Restricted Subsidiary or any
            Insurance Subsidiary seeking liquidation, reorganization or other
            relief with respect to it or its debts under any bankruptcy,
            insolvency or other similar law now or hereafter in effect or
            seeking the appointment of a trustee, receiver, liquidator,
            custodian or other similar official of it or any substantial part of
            its property, and such involuntary case or other proceeding shall
            remain undismissed and unstayed for a period of 60 days; or an order
            for relief shall be entered against the Borrower or any Restricted
            Subsidiary or any Insurance Subsidiary under the federal bankruptcy
            laws as now or hereafter in effect;

                  (i)  any member of the ERISA Group shall fail to pay when due
            an amount or amounts aggregating in excess of $10,000,000 which it
            shall have become liable to pay under Title IV of ERISA; or notice
            of intent to terminate a Material Plan shall be filed under Title IV
            of ERISA by any member of the ERISA Group, any plan administrator or
            any combination of the foregoing; or the PBGC shall institute
            proceedings under Title IV of ERISA to terminate, to impose
            liability (other than for premiums under Section 4007 of ERISA) in
            respect of, or to cause a trustee to be appointed to administer any
            Material Plan; or a condition shall exist by reason of which the
            PBGC would be entitled to obtain a decree adjudicating that any
            Material Plan must be terminated;

                                       52
<PAGE>

            or there shall occur a complete or partial withdrawal from, or a
            default, within the meaning of Section 4219(c)(5) of ERISA, with
            respect to, one or more Multiemployer Plans which could cause one or
            more members of the ERISA Group to incur a current payment
            obligation in excess of $10,000,000;

                  (j)  a judgment or order for the payment of money in excess of
            $10,000,000 shall be rendered against the Borrower or any Restricted
            Subsidiary or any Insurance Subsidiary and such judgment or order
            shall continue unsatisfied and unstayed for a period of 30 days; or

                  (k)  any person or group of persons (within the meaning of
            Section 13 or 14 of the Securities Exchange Act of 1934, as amended)
            shall have acquired beneficial ownership (within the meaning of Rule
            13d-3 promulgated by the Securities and Exchange Commission under
            said Act) of 25% or more of the outstanding shares of common stock
            of the Borrower; or, during any period of twelve consecutive
            calendar months, individuals who were directors of the Borrower on
            the first day of such period shall cease to constitute a majority of
            the board of directors of the Borrower;

       then, and in every such event, the Agent shall, (i) if requested by Banks
       having more than 50% in aggregate amount of the Commitments, by notice to
       the Borrower terminate the Commitments and they shall thereupon terminate
       and (ii) if requested by Banks holding Notes evidencing more than 50% in
       aggregate principal amount of the Loans, by notice to the Borrower
       declare the Notes (together with accrued interest thereon) to be, and the
       Notes shall thereupon become, immediately due and payable without
       presentment, demand, protest or other notice of any kind, all of which
       are hereby waived by the Borrower; provided that in the case of any of
                                          --------
       the Events of Default specified in clause (g) or (h) above with respect
       to the Borrower, without any notice to the Borrower or any other act by
       the Agent or the Banks, the Commitments shall thereupon terminate and the
       Notes (together with accrued interest thereon) shall become immediately
       due and payable without presentment, demand, protest or other notice of
       any kind, all of which are hereby waived by the Borrower.

                 SECTION 6.02.  Notice of Default.  The Agent shall give notice
                                -----------------
       to the Borrower under Section 6.01(c) promptly upon being requested to do
       so by any Bank and shall thereupon notify all the Banks thereof.

                                       53
<PAGE>

                                  ARTICLE VII

                                   THE AGENT

                 SECTION 7.01. Appointment and Authorization. Each Bank
                               -----------------------------
irrevocably appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement and the Notes as are
delegated to the Agent by the terms hereof or thereof, together with all such
powers as are reasonably incidental thereto.

                 SECTION 7.02. Agent and Affiliates. Morgan Guaranty Trust
                               --------------------
Company of New York shall have the same rights and powers under this Agreement
as any other Bank and may exercise or refrain from exercising the same as though
it were not the Agent, and Morgan Guaranty Trust Company of New York and its
affiliates may accept deposits from, lend money to, and generally engage in any
kind of business with the Borrower or any Subsidiary or affiliate of the
Borrower as if it were not the Agent hereunder.

                 SECTION 7.03. Action by Agent. The obligations of the Agent
                               ---------------
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agent shall not be required to take any action
with respect to any Default, except as expressly provided in Article VI.

                 SECTION 7.04. Consultation with Experts. The Agent may consult
                               -------------------------
with legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.

                 SECTION 7.05. Liability of Agent. Neither the Agent nor any of
                               ------------------
its affiliates nor any of their respective directors, officers, agents or
employees shall be liable for any action taken or not taken by it in connection
herewith (i) with the consent or at the request of the Required Banks or (ii) in
the absence of its own gross negligence or willful misconduct. Neither the Agent
nor any of its affiliates nor any of their respective directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify (i) any statement, warranty or representation made in
connection with this Agreement or any borrowing hereunder; (ii) the performance

                                       54
<PAGE>

or observance of any of the covenants or agreements of the Borrower; (iii) the
satisfaction of any condition specified in Article III, except receipt of items
required to be delivered to the Agent; or (iv) the validity, effectiveness or
genuineness of this Agreement, the Notes or any other instrument or writing
furnished in connection herewith. The Agent shall not incur any liability by
acting in reliance upon any notice, consent, certificate, statement, or other
writing (which may be a bank wire, telex or similar writing) believed by it to
be genuine or to be signed by the proper party or parties.

                 SECTION 7.06. Indemnification. Each Bank shall, ratably in
                               ---------------
accordance with its initial Commitment, indemnify the Agent, its affiliates and
their respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Agreement or any action
taken or omitted by such indemnitees hereunder.

                 SECTION 7.07. Credit Decision. Each Bank acknowledges that it
                               ---------------
has, independently and without reliance upon the Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.

                 SECTION 7.08. Successor Agent. The Agent may resign at any time
by giving notice thereof to the Banks and the Borrower, and such notice shall be
effective on the date specified therein (unless otherwise stated therein)
whether or not a successor Agent is appointed and accepts such appointment as
provided below. Upon any such resignation, the Required Banks shall have the
right to appoint a successor Agent with the consent of the Borrower. If no such
successor Agent shall have been so appointed, and shall have accepted such
appointment, within 30 days after the retiring Agent gives notice of
resignation, then the retiring Agent may, on behalf of the Banks, appoint a
successor Agent, which shall be a commercial bank organized or licensed under
the laws of the United States of America or of any State thereof and having a
combined capital and

                                       55
<PAGE>

surplus of at least $50,000,000. Upon the acceptance of its appointment as Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations hereunder.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this Article shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent.

                 SECTION 7.09. Agent's Fee. The Borrower shall pay to the Agent
                               -----------
for its own account fees in the amounts and at the times previously agreed upon
between the Borrower and the Agent.

                                  ARTICLE VIII

                            CHANGE IN CIRCUMSTANCES

                 SECTION 8.01. Basis for Determining Interest Rate Inadequate or
                               -------------------------------------------------
Unfair. If on or prior to the first day of any Interest Period for any Fixed
------
Rate Borrowing:

                  (a)  the Agent is advised by the Reference Banks that deposits
            in dollars (in the applicable amounts) are not being offered to the
            Reference Banks in the relevant market for such Interest Period, or

                  (b)  in the case of a Committed Borrowing, Banks having 50% or
            more of the aggregate amount of the Commitments advise the Agent
            that the Adjusted CD Rate or the London Interbank Offered Rate, as
            the case may be, as determined by the Agent will not adequately and
            fairly reflect the cost to such Banks of funding their CD Loans or
            Euro-Dollar Loans, as the case may be, for such Interest Period,

the Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, the obligations of the Banks to make CD
Loans or Euro-Dollar Loans, as the case may be, shall be suspended. Unless the
Borrower notifies the Agent at least two Domestic Business Days before the date
of any Fixed Rate Borrowing for which a Notice of Borrowing has previously been
given that it elects not to borrow on such date, (i) if such Fixed Rate
Borrowing is a Committed Borrowing, such Borrowing shall instead be made as a
Base

                                       56
<PAGE>

Rate Borrowing and (ii) if such Fixed Rate Borrowing is a Money Market LIBOR
Borrowing, the Money Market LIBOR Loans comprising such Borrowing shall bear
interest for each day from and including the first day to but excluding the last
day of the Interest Period applicable thereto at the Base Rate for such day.

                 SECTION 8.02. Illegality. If, on or after the date of this
                               ----------
Agreement, the adoption of any applicable law, rule or regulation, or any change
in any applicable law, rule or regulation, or any change in the interpretation
or administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Bank (or its Euro-Dollar Lending Office) with any request or
directive (whether or not having the force of law) of any such authority,
central bank or comparable agency shall make it unlawful or impossible for any
Bank (or its Euro-Dollar Lending Office) to make, maintain or fund its Euro-
Dollar Loans and such Bank shall so notify the Agent, the Agent shall forthwith
give notice thereof to the other Banks and the Borrower, whereupon until such
Bank notifies the Borrower and the Agent that the circumstances giving rise to
such suspension no longer exist, the obligation of such Bank to make Euro-Dollar
Loans shall be suspended. Before giving any notice to the Agent pursuant to this
Section, such Bank shall designate a different Euro-Dollar Lending Office if
such designation will avoid the need for giving such notice and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. If such Bank
shall determine that it may not lawfully continue to maintain and fund any of
its outstanding Euro-Dollar Loans to maturity and shall so specify in such
notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of each such Euro-Dollar Loan, together with accrued interest
thereon. Concurrently with prepaying each such Euro-Dollar Loan, the Borrower
shall borrow a Base Rate Loan in an equal principal amount from such Bank (on
which interest and principal shall be payable contemporaneously with the related
Euro-Dollar Loans of the other Banks), and such Bank shall make such a Base Rate
Loan.

                 SECTION 8.03. Increased Cost and Reduced Return. (a) If on or
                               ---------------------------------
after (x) the date hereof, in the case of any Committed Loan or any obligation
to make Committed Loans or (y) the date of the related Money Market Quote, in
the case of any Money Market Loan, the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority,

                                       57
<PAGE>

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

                   (i)  shall subject any Bank (or its Applicable Lending
            Office) to any tax, duty or other charge with respect to its Fixed
            Rate Loans, its Note or its obligation to make Fixed Rate Loans, or
            shall change the basis of taxation of payments to any Bank (or its
            Applicable Lending Office) of the principal of or interest on its
            Fixed Rate Loans or any other amounts due under this Agreement in
            respect of its Fixed Rate Loans or its obligation to make Fixed Rate
            Loans (except for changes in the rate of tax on the overall net
            income of such Bank or its Applicable Lending Office imposed by the
            jurisdiction in which such Bank's principal executive office or
            Applicable Lending Office is located); or

                  (ii)  shall impose, modify or deem applicable any reserve
            (including, without limitation, any such requirement imposed by the
            Board of Governors of the Federal Reserve System, but excluding (A)
            with respect to any CD Loan any such requirement included in an
            applicable Domestic Reserve Percentage and (B) with respect to any
            Euro-Dollar Loan, any such requirement with respect to which such
            Bank is entitled to compensation during the relevant Interest Period
            under Section 2.16), special deposit, insurance assessment
            (excluding, with respect to any CD Loan, any such requirement
            reflected in an applicable Assessment Rate) or similar requirement
            against assets of, deposits with or for the account of, or credit
            extended by, any Bank (or its Applicable Lending Office) or shall
            impose on any Bank (or its Applicable Lending Office) or on the
            United States market for certificates of deposit or the London
            interbank market any other condition affecting its Fixed Rate Loans,
            its Note or its obligation to make Fixed Rate Loans;

and the result of any of the foregoing is to increase the cost to such Bank (or
its Applicable Lending Office) of making or maintaining any Fixed Rate Loan, or
to reduce the amount of any sum received or receivable by such Bank (or its
Applicable Lending Office) under this Agreement or under its Note with respect
thereto, by an amount deemed by such Bank to be material, then, within 15 days
after demand by such Bank (with a copy to the Agent), the Borrower shall pay to
such Bank such additional amount or amounts as will

                                       58
<PAGE>

compensate such Bank for such increased cost or reduction.

                 (b) If any Bank shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency has or would have the effect of reducing the rate of return on
capital of such Bank (or its Parent) as a consequence of such Bank's obligations
hereunder to a level below that which such Bank (or its Parent) could have
achieved but for such adoption, change, request or directive (taking into
consideration its policies with respect to capital adequacy) by an amount deemed
by such Bank to be material, then from time to time, within 15 days after demand
by such Bank (with a copy to the Agent), the Borrower shall pay to such Bank
such additional amount or amounts as will compensate such Bank (or its Parent)
for such reduction.

                 (c) Each Bank will promptly notify the Borrower and the Agent
of any event of which it has knowledge, occurring after the date hereof, which
will entitle such Bank to compensation pursuant to this Section and will
designate a different Applicable Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. A certificate
of any Bank claiming compensation under this Section and setting forth the
additional amount or amounts to be paid to it hereunder (and, to the extent
deemed feasible by such Bank, setting forth the calculation thereof) shall be
conclusive in the absence of manifest error. In determining such amount, such
Bank may use any reasonable averaging and attribution methods.

                 SECTION 8.04. Base Rate Loans Substituted for Affected Fixed
                               ----------------------------------------------
Rate Loans. If (i) the obligation of any Bank to make Euro-Dollar Loans has been
----------
suspended pursuant to Section 8.02 or (ii) any Bank has demanded compensation
under Section 8.03(a) and the Borrower shall, by at least five Euro-Dollar
Business Days' prior notice to such Bank through the Agent, have elected that
the provisions of this Section shall apply to such Bank, then, unless and until
such Bank notifies the Borrower that the circumstances giving rise to such
suspension or demand for compensation no longer exist:

                                       59
<PAGE>

                  (a)  all Loans which would otherwise be made by such Bank as
            CD Loans or Euro-Dollar Loans, as the case may be, shall be made
            instead as Base Rate Loans (on which interest and principal shall be
            payable contemporaneously with the related Fixed Rate Loans of the
            other Banks), and

                  (b)  after each of its CD Loans or Euro-Dollar Loans, as the
            case may be, has been repaid, all payments of principal which would
            otherwise be applied to repay such Fixed Rate Loans shall be applied
            to repay its Base Rate Loans instead.

                                   ARTICLE IX

                                 MISCELLANEOUS

                 SECTION 9.01. Notices. All notices, requests and other
                               -------
communications to any party hereunder shall be in writing (including bank wire,
telecopier, facsimile transmission or similar writing) and shall be given to
such party: (x) in the case of the Borrower or the Agent, at its address or
telecopy number set forth on the signature pages hereof, (y) in the case of any
Bank, at its address or telecopy number set forth in its Administrative
Questionnaire or (z) in the case of any party, such other address or telecopy
number as such party may hereafter specify for the purpose by notice to the
Agent and the Borrower. Each such notice, request or other communication shall
be effective (i) if given by telecopy, when such telecopy is transmitted to the
telecopy number specified in this Section and is received, (ii) if given by
mail, 72 hours after such communication is deposited in the mails with first
class postage prepaid, addressed as aforesaid or (iii) if given by any other
means, when delivered at the address specified in this Section; provided that
                                                                --------
notices to the Agent under Article II or Article VIII shall not be effective
until received.

                 SECTION 9.02. No Waivers. No failure or delay by the Agent or
                               ----------
any Bank in exercising any right, power or privilege hereunder or under any Note
shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.

                                       60
<PAGE>

                 SECTION 9.03. Expenses; Documentary Taxes; Indemnification. (a)
                               --------------------------------------------
The Borrower shall pay (i) all reasonable out-of-pocket expenses of the Agent,
including fees and disbursements of Davis Polk & Wardwell, special counsel for
the Agent, in connection with the preparation and administration of this
Agreement, any waiver or consent hereunder or any amendment hereof or any
Default hereunder and (ii) if an Event of Default occurs, all reasonable out-of-
pocket expenses incurred by the Agent and each Bank, including fees and
disbursements of counsel, in connection with such Event of Default and
collection, bankruptcy, insolvency and other enforcement proceedings resulting
therefrom. The Borrower shall indemnify each Bank against any transfer taxes,
documentary taxes, assessments or charges made by any governmental authority by
reason of the execution and delivery of this Agreement or the Notes.

                 (b) The Borrower agrees to indemnify the Agent and each Bank,
their respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel, which may be incurred by such Indemnitee in connection
with any investigative, administrative or judicial proceeding (whether or not
such Indemnitee shall be designated a party thereto) brought or threatened
relating to or arising out of this Agreement or any actual or proposed use of
proceeds of Loans hereunder; provided that no Indemnitee shall have the right to
                             --------
be indemnified hereunder for such Indemnitee's own gross negligence or willful
misconduct as determined by a court of competent jurisdiction.

                  SECTION 9.04. Sharing of Set-Offs. Each Bank agrees that if it
                                -------------------
shall, by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Note held by it which is greater than the proportion
received by any other Bank in respect of the aggregate amount of principal and
interest due with respect to any Note held by such other Bank, the Bank
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks shall be shared by the
Banks pro rata; provided that nothing in this Section shall impair the right of
                --------
any Bank to exercise any right of

                                       61
<PAGE>

set-off or counterclaim it may have and to apply the amount subject to such
exercise to the payment of indebtedness of the Borrower other than its
indebtedness under the Notes. The Borrower agrees, to the fullest extent it may
effectively do so under applicable law, that any holder of a participation in a
Note, whether or not acquired pursuant to the foregoing arrangements, may
exercise rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Borrower in the amount of such participation.

                 SECTION 9.05. Amendments and Waivers. Any provision of this
                               ----------------------
Agreement or the Notes may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrower and the Required Banks
(and, if the rights or duties of the Agent are affected thereby, by the Agent);
provided that no such amendment or waiver shall, unless signed by all the Banks
--------
(and the Borrower and, if and to the extent provided above, the Agent), (i)
increase or decrease the Commitment of any Bank (except for a ratable decrease
in the Commitments of all Banks) or subject any Bank to any additional
obligation, (ii) reduce the principal of or rate of interest on any Loan or any
fees hereunder, except as provided below, (iii) postpone the date fixed for any
payment of principal of or interest on any Loan or any fees hereunder or for any
reduction or termination of any Commitment or (iv) change the percentage of the
Commitments or of the aggregate unpaid principal amount of the Notes, or the
number of Banks, which shall be required for the Banks or any of them to take
any action under this Section or any other provision of this Agreement.

                 SECTION 9.06. Successors and Assigns. (a) The provisions of
                               ----------------------
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns, except that the
Borrower may not assign or otherwise transfer any of its rights under this
Agreement without the prior written consent of all Banks, and no Bank may grant
participating interests in its Commitment or any of its Loans or assign all or
any of its rights and obligations under this Agreement and the Notes in
violation of subsections (b) and (c) below, taking into account the
applicability of the last sentence of such subsection (b).

                 (b)  Any Bank may at any time grant to one or more banks or
       other institutions (each a "Participant") participating interests in its
       Commitment or any or all of its Loans.  In the event of any such grant by
       a Bank of a

                                       62
<PAGE>

       participating interest to a Participant, whether or not upon notice to
       the Borrower and the Agent, such Bank shall remain responsible for the
       performance of its obligations hereunder, and the Borrower and the Agent
       shall continue to deal solely and directly with such Bank in connection
       with such Bank's rights and obligations under this Agreement. Any
       agreement pursuant to which any Bank may grant such a participating
       interest shall provide that such Bank shall retain the sole right and
       responsibility to enforce the obligations of the Borrower hereunder
       including, without limitation, the right to approve any amendment,
       modification or waiver of any provision of this Agreement; provided that
                                                                  --------
       such participation agreement may provide that such Bank will not agree to
       any modification, amendment or waiver of this Agreement described in
       clause (i), (ii) or (iii) of Section 9.05 without the consent of the
       Participant. The Borrower agrees that each Participant shall, to the
       extent provided in its participation agreement and subject to subsection
       (e) below, be entitled to the benefits of Article VIII and Section 2.16
       with respect to its participating interest. An assignment or other
       transfer which is not permitted by subsection (c) or (d) below shall be
       given effect for purposes of this Agreement only to the extent of a
       participating interest granted in accordance with this subsection (b).

                 (c)  Any Bank may at any time assign to one or more banks or
       other institutions (each an "Assignee") all, or a proportionate part of
       all, of its rights and obligations under this Agreement and the Notes,
       and such Assignee shall assume such rights and obligations, pursuant to
       an Assignment and Assumption Agreement in substantially the form of
       Exhibit G hereto executed by such Assignee and such transferor Bank, with
       (and subject to) the subscribed consent of the Borrower and the Agent;

       provided that if an Assignee is an affiliate of such transferor Bank, no
       --------
       such consent shall be required; provided further that such assignment
                                       -------- -------
       may, but need not, include rights of the transferor Bank in respect of
       outstanding Money Market Loans; and provided further that such assignment
                                           -------- -------
       shall be in a principal amount not less than $10,000,000.  Upon execution
       and delivery of such instrument and payment by such Assignee to such
       transferor Bank of an amount equal to the purchase price agreed between
       such transferor Bank and such Assignee, such Assignee shall be a Bank
       party to this Agreement and shall have all the rights and obligations of
       a Bank with a Commitment as set forth in such instrument of assumption,
       and the transferor Bank shall be released from its obligations hereunder
       to a corresponding extent, and no further consent or action by any party
       shall be required.  Upon the consummation of any assignment pursuant to
       this

                                       63
<PAGE>

       subsection (c), the transferor Bank, the Agent and the Borrower shall
       make appropriate arrangements so that, if required, a new Note is issued
       to the Assignee. In connection with any such assignment, the transferor
       Bank shall pay to the Agent an administrative fee for processing such
       assignment in the amount of $2,000. If the Assignee is not incorporated
       under the laws of the United States of America or a state thereof, it
       shall, prior to the first date on which interest or fees are payable
       hereunder for its account, deliver to the Borrower and the Agent
       certification as to exemption from deduction or withholding of any United
       States federal income taxes in accordance with Section 2.15.

                 (d)  Any Bank may at any time assign all or any portion of its
       rights under this Agreement and its Note to a Federal Reserve Bank.  No
       such assignment shall release the transferor Bank from its obligations
       hereunder.

                 (e)  No Assignee, Participant or other transferee of any Bank's
       rights shall be entitled to receive any greater payment under Section
       8.03 than such Bank would have been entitled to receive with respect to
       the rights transferred, unless such transfer is made with the Borrower's
       prior written consent or by reason of the provisions of Section 8.02 or
       8.03 requiring such Bank to designate a different Applicable Lending
       Office under certain circumstances or at a time when the circumstances
       giving rise to such greater payment did not exist.

                 SECTION 9.07.  Collateral.  Each of the Banks represents to the
                                ----------
Agent and each of the other Banks that it in good faith is not relying upon any
"margin stock" (as defined in Regulation U) as collateral in the extension or
maintenance of the credit provided for in this Agreement.

                 SECTION 9.08.  Governing Law; Submission to Jurisdiction.  This
                                -----------------------------------------
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower irrevocably
waives, to the fullest extent permitted by law, any objection which it may now
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court has
been brought in an inconvenient forum.

                 SECTION 9.09.  Counterparts; Integration.  This
                                -------------------------

                                       64
<PAGE>

Agreement may be signed in any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof.

                 SECTION 9.10.  Confidentiality.  The Agent and each Bank agree
                                ---------------
that they will maintain the confidentiality of any material information provided
under, or in connection with, this Agreement by or on behalf of the Borrower
that has been identified by the Borrower as confidential or that the Agent or
such Bank knows, or has reason to know, is confidential (hereinafter
collectively called "Confidential Information"), subject to the Agent's and each
Bank's (a) obligation to disclose any such Confidential Information pursuant to
a request or order under applicable laws and regulations or pursuant to a
subpoena or other legal process, (b) right to disclose any such Confidential
Information to its bank examiners, auditors, counsel and other professional
advisors and to other Banks, (c) right to disclose any such Confidential
Information in connection with any litigation or dispute involving one or more
of the Banks or the Agent and the Borrower, provided that the Banks so involved
                                            --------
or the Agent, as the case may be, shall provide the Borrower with reasonable
notice of the disclosure of such Confidential Information solely to enable the
Borrower to attempt to obtain a court order limiting the disclosure thereof
outside of the scope of such litigation or dispute but only if such notice is
not prejudicial to such Banks or the Agent and (d) right to provide such
information to participants, prospective participants or prospective assignees
pursuant to Section 9.06 if such participant, prospective participant or
prospective assignee agrees in writing to maintain the confidentiality of such
information on terms substantially similar to those of this Section 9.10 as if
it were a "Bank" party hereto. Notwithstanding the foregoing, any such
information supplied to a Bank, participant, prospective participant or
prospective assignee under this Agreement shall cease to be Confidential
Information if it is or becomes known to such Person by other than unauthorized
disclosure, or if it becomes a matter of public knowledge.

                                       65
<PAGE>

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

                                 UNUM CORPORATION

                                 By /s/ Timothy W. Ludden
                                    ----------------------------
                                    Title:Vice President & Treasurer
                                 2211 Congress Street
                                 Portland, Maine  04122
                                 Telecopy number: 207-770-4387

                                       66
<PAGE>

       Commitments
       -----------

       $48,000,000     MORGAN GUARANTY TRUST COMPANY
                         OF NEW YORK

                         By /s/ Jerry J. Fall
                            ----------------------------
                            Title: Vice President

       $46,000,000     ABN AMRO BANK N.V.,
                         NEW YORK BRANCH

                         By /s/ David B. Martens
                            ----------------------------
                            Title: Vice President

                         By  /s/ David W. Eastep
                             ----------------------------
                             Title: Asst. Vice President

       $46,000,000     THE BANK OF NEW YORK

                         By /s/ Lizanne T. Eberle
                            ----------------------------
                            Title: Vice President

       $46,000,000     BANK OF TOKYO-MITSUBISHI
                         TRUST COMPANY

                         By /s/ Margaret Sunier
                            -------------------------------
                            Title: Vice President & Manager

       $46,000,000     FLEET BANK OF MAINE

                          By /s/ Tracy L. Hawkins
                             ----------------------------
                             Title: Vice President

                                       67
<PAGE>

       Commitments
       -----------

       $46,000,000     MELLON BANK, N.A.

                         By /s/ Susan M. Whitewood
                            ----------------------------
                            Title: Asst. Vice President

       $46,000,000     WACHOVIA BANK OF GEORGIA, N.A.

                          By /s/ Terence A. Snellings
                             ----------------------------
                             Title: Senior Vice President

       $23,000,000     THE FIRST NATIONAL BANK OF BOSTON

                           By /s/ Stewart P. Neff
                              ----------------------------
                              Title: Managing Director

       $23,000,000     THE CHASE MANHATTAN BANK

                           By /s/ Peter W. Platten
                              ----------------------------
                              Title: Vice President

       $23,000,000     CIBC INC.

                            By /s/ David B. Walsh
                               ----------------------------
                               Title: Managing Director

       $23,000,000     THE DAI-ICHI KANGYO BANK, LTD.,
                         NEW YORK BRANCH

                            By  /s/ Kim P. Leary
                                ----------------------------
                                Title: Vice President

                                       68
<PAGE>

       Commitments
       -----------

       $23,000,000     THE FIRST NATIONAL BANK OF CHICAGO

                            By  /s/ Frances A. Melville
                                ----------------------------
                                Title: Corp. Banking Officer

       $23,000,000     THE INDUSTRIAL BANK OF JAPAN,

                            By /s/ Takuya Honjo
                               ----------------------------
                               Title: Senior Vice President

       $23,000,000     THE SUMITOMO BANK, LIMITED,
                                   NEW YORK BRANCH

                            By /s/ Yoshinori Kawamura
                               ----------------------------
                               Title: Joint General Manager

       $15,000,000     CREDIT LYONNAIS NEW YORK BRANCH

                            By /s/ Sebastian Rocco
                               ----------------------------
                               Title: First Vice President

       _________________

       Total Commitments

       $500,000,000
       =================

                                       69
<PAGE>

                                 MORGAN GUARANTY TRUST COMPANY
                                   OF NEW YORK, as Agent

                                   By /s/ Jerry J. Fall
                                      ---------------------------
                                      Title: Vice President
                                   60 Wall Street
                                   New York, New York  10260-0060
                                   Attention:  Jerry J. Fall
                                   Telecopy number:  212-648-9956

                                       70
<PAGE>

                                                      EXHIBIT A

                                     NOTE

                                               New York, New York
                                                           , 19

                 For value received, UNUM Corporation, a Delaware corporation
(the "Borrower"), promises to pay to the order of

(the "Bank"), for the account of its Applicable Lending Office, the unpaid
principal amount of each Loan made by the Bank to the Borrower pursuant to the
Credit Agreement referred to below on the last day of the Interest Period
relating to such Loan. The Borrower promises to pay interest on the unpaid
principal amount of each such Loan on the dates and at the rate or rates
provided for in the Credit Agreement. All such payments of principal and
interest shall be made in lawful money of the United States in Federal or other
immediately available funds at the office of Morgan Guaranty Trust Company of
New York, 60 Wall Street, New York, New York.

                 All Loans made by the Bank, the respective types and maturities
thereof and all repayments of the principal thereof shall be recorded by the
Bank and, prior to any transfer hereof, appropriate notations to evidence the
foregoing information with respect to each such Loan then outstanding shall be
endorsed by the Bank on the schedule attached hereto, or on a continuation of
such schedule attached to and made a part hereof; provided that the failure of
                                                  --------
the Bank to make any such recordation or endorsement shall not affect the
obligations of the Borrower hereunder or under the Credit Agreement.

                 This note is one of the Notes referred to in the Credit
Agreement dated as of October 29, 1996 among the Borrower, the banks listed on
the signature pages thereof and Morgan Guaranty Trust Company of New York, as
Agent (as the same may be amended from time to time, the "Credit
<PAGE>

Agreement"). Terms defined in the Credit Agreement are used herein with the same
meanings. Reference is made to the Credit Agreement for provisions for the
prepayment hereof and the acceleration of the maturity hereof.

                                      UNUM CORPORATION

                                      By________________________
                                         Title:

                                       2
<PAGE>

                                 Note (cont'd)

                        LOANS AND PAYMENTS OF PRINCIPAL

__________________________________________________________________

                                 Amount of
       Amount of       Type of   Principal      Maturity   Notation
Date   Loan            Loan      Repaid         Date       Made By
__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

__________________________________________________________________

                                      3
<PAGE>

                                                      EXHIBIT B

                      Form of Money Market Quote Request
                      ----------------------------------

                                               [Date]

To:    Morgan Guaranty Trust Company of New York
           (the "Agent")

From:  UNUM Corporation

Re:    Credit Agreement (the "Credit Agreement") dated as of October 29,
           1996 among the Borrower, the Banks listed on the signature
           pages thereof and the Agent

           We hereby give notice pursuant to Section 2.03 of the Credit
Agreement that we request Money Market Quotes for the following proposed
Money Market Borrowing(s):

Date of Borrowing:  __________________

Principal Amount*             Interest Period**
----------------              ---------------
$

           Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]

--------------
   * Amount must be $10,000,000 or a larger multiple of $1,000,000.

  ** Not less than one month (LIBOR Auction) or not less than 7 days (Absolute
     Rate Auction), subject to the provisions of the definition of Interest
     Period.
<PAGE>

     Terms used herein have the meanings assigned to them in the Credit
Agreement.

                                      UNUM CORPORATION

                                      By________________________
                                         Title:

                                       2
<PAGE>

                                                      EXHIBIT C

                  Form of Invitation for Money Market Quotes
                  ------------------------------------------

To:    [Name of Bank]

Re:    Invitation for Money Market Quotes to UNUM
       Corporation (the "Borrower")

       Pursuant to Section 2.03 of the Credit Agreement dated as of October 29,
1996 among the Borrower, the Banks parties thereto and the undersigned, as
Agent, we are pleased on behalf of the Borrower to invite you to submit Money
Market Quotes to the Borrower for the following proposed Money Market
Borrowing(s):

Date of Borrowing:  __________________

Principal Amount           Interest Period
----------------           ---------------

$

       Such Money Market Quotes should offer a Money Market [Margin] [Absolute
Rate]. [The applicable base rate is the London Interbank Offered Rate.]

       Please respond to this invitation by no later than [2:00 P.M.] [9:15
A.M.] (New York City time) on [date].

                                      MORGAN GUARANTY TRUST COMPANY
                                        OF NEW YORK

                                      By______________________
                                         Authorized Officer
<PAGE>

                                                      EXHIBIT D

                           Form of Money Market Quote
                           --------------------------

       To:    Morgan Guaranty Trust Company of New York,
                    as Agent

       Re:    Money Market Quote to UNUM Corporation (the "Borrower")

                 In response to your invitation on behalf of the Borrower dated
       _____________, 19__, we hereby make the following Money Market Quote on
       the following terms:

       1.  Quoting Bank:  ________________________________

       2.   Person to contact at Quoting Bank:

            _____________________________

       3.   Date of Borrowing: ____________________*

       4.   We hereby offer to make Money Market Loan(s) in the following
            principal amounts, for the following Interest Periods and at the
            following rates:

         Principal     Interest                   Money Market
         Amount/**/   Period/***/       [Margin/****/] [Absolute Rate/*****/]
        -----------   -----------       -------------------------------------

       $

       $

            [Provided, that the aggregate principal amount of Money Market Loans
            for which the above offers may be accepted shall not exceed
            $____________.]/**/

       ____________________

       /*/As specified in the related Invitation.

       /**/Principal amount bid for each Interest Period may not exceed
       principal amount requested.  Specify aggregate limitation if the sum of
       the individual offers exceeds the amount the Bank is willing to lend.
       Bids must be made for $5,000,000 or a larger multiple of $1,000,000.

                    (notes continued on following page)
<PAGE>

                 We understand and agree that the offer(s) set forth above,
       subject to the satisfaction of the applicable conditions set forth in the
       Credit Agreement dated as of October 29, 1996 among the Borrower, the
       Banks listed on the signature pages thereof and yourselves, as Agent,
       irrevocably obligates us to make the Money Market Loan(s) for which any
       offer(s) are accepted, in whole or in part.

                                      Very truly yours,

                                      [NAME OF BANK]

       Dated:_______________      By:__________________________
                                         Authorized Officer

       ____________________

       /***/Not less than one month or not less than 7 days, as specified in the
       related Invitation.  No more than five bids are permitted for each
       Interest Period.

       /****/Margin over or under the London Interbank Offered Rate determined
       for the applicable Interest Period.  Specify percentage (to the nearest
       1/10,000 of 1%) and specify whether "PLUS" or "MINUS".

       /*****/Specify rate of interest per annum (to the nearest 1/10,000th of
       1%).

                                       2
<PAGE>

                                                      EXHIBIT E

                                   OPINION OF
                            COUNSEL FOR THE BORROWER
                            ------------------------

                                             [Effective Date]

       To the Banks and the Agent
         Referred to Below
       c/o Morgan Guaranty Trust Company
         of New York, as Agent
       60 Wall Street
       New York, New York  10260

       Dear Sirs:

                 I am General Counsel of UNUM Corporation.  This opinion is
       being rendered to you pursuant to Section 3.01(c) of the Credit Agreement
       (the "Credit Agreement") dated as of October 29, 1996 among the Borrower,
       the banks listed on the signature pages thereof and Morgan Guaranty Trust
       Company of New York, as Agent.  Terms defined in the Credit Agreement are
       used herein as therein defined.

                 I have examined originals or copies, certified or otherwise
       identified to our satisfaction, of such documents, corporate records,
       certificates of public officials and other instruments and have conducted
       such other investigations of fact and law as I have deemed necessary or
       advisable for purposes of this opinion.

                  Upon the basis of the foregoing, I am of the opinion that:

                 1.  The Borrower is a corporation duly incorporated, validly
       existing and in good standing under the laws of Delaware, and has all
       corporate powers and all material governmental licenses, authorizations,
       consents and approvals required to carry on its business as now
       conducted.

                 2.  The execution, delivery and performance by the Borrower of
       the Credit Agreement and the Notes are within the Borrower's corporate
       powers, have been duly authorized by all necessary corporate action,
       require no action by or in respect of, or filing with, any governmental
       body, agency or official and do not contravene, or constitute a default
<PAGE>

       under, any provision of applicable law or regulation or of the
       certificate of incorporation or by-laws of the Borrower or any Restricted
       Subsidiary or of any agreement, judgment, injunction, order, decree or
       other instrument binding upon the Borrower or any Restricted Subsidiary
       or result in the creation or imposition of any Lien on any asset of the
       Borrower or any Restricted Subsidiary.

                 3.  The Credit Agreement constitutes a valid and binding
       agreement of the Borrower, and the Notes constitute valid and binding
       obligations of the Borrower, in each case enforceable in accordance with
       their respective terms except as (i) the enforceability thereof may be
       limited by bankruptcy, insolvency or similar laws affecting creditors'
       rights generally and (ii) rights of acceleration and the availability of
       equitable remedies may be limited by equitable principles of general
       applicability.

                 4.  There is no action, suit or proceeding pending against, or
       to the best of my knowledge threatened against or affecting, the Borrower
       or any of its Subsidiaries before any court or arbitrator or any
       governmental body, agency or official, in which there is a reasonable
       possibility of an adverse decision which could materially adversely
       affect the business, consolidated financial position or consolidated
       results of operations of the Borrower and the Restricted Subsidiaries,
       taken as a whole, or which in any manner draws into question the validity
       or enforceability of the Credit Agreement or the Notes.

                 5.  Each of the Restricted Subsidiaries is a corporation
       validly existing and in good standing under the laws of its jurisdiction
       of incorporation, and has all corporate powers and all material
       governmental licenses, authorizations, consents and approvals required to
       carry on its business as now conducted.

                 6.  Neither the Borrower nor any Restricted Subsidiary is an
       "investment company" within the meaning of the Investment Company Act of
       1940, as amended.

                 Although I am not admitted to the Bar of the State of New York,
       I am competent to give this opinion.

                                    Very truly yours,

                                       2
<PAGE>

                                                           EXHIBIT F

                                   OPINION OF
                     DAVIS POLK & WARDWELL, SPECIAL COUNSEL
                                    FOR THE AGENT
                     --------------------------------------

                                          [Effective Date]

       To the Banks and the Agent
         Referred to Below
       c/o Morgan Guaranty Trust Company
         of New York, as Agent
       60 Wall Street
       New York, New York  10260

       Dear Sirs:

                 We have participated in the preparation of the Credit Agreement
       (the "Credit Agreement") dated as of October 29, 1996 among UNUM
       Corporation, a Delaware corporation (the "Borrower"), the banks listed on
       the signature pages thereof (the "Banks") and Morgan Guaranty Trust
       Company of New York, as Agent (the "Agent"), and have acted as special
       counsel for the Agent for the purpose of rendering this opinion pursuant
       to Section 3.01(d) of the Credit Agreement.  Terms defined in the Credit
       Agreement are used herein as therein defined.

                 We have examined originals or copies, certified or otherwise
       identified to our satisfaction, of such documents, corporate records,
       certificates of public officials and other instruments and have conducted
       such other investigations of fact and law as we have deemed necessary or
       advisable for purposes of this opinion.

                  Upon the basis of the foregoing, we are of the opinion that:

                 1.  The execution, delivery and performance by the Borrower of
       the Credit Agreement and the Notes are within the Borrower's corporate
       powers and have been duly authorized by all necessary corporate action.

                 2.  The Credit Agreement constitutes a valid and binding
       agreement of the Borrower, and the Notes constitute
<PAGE>

       valid and binding obligations of the Borrower, in each case enforceable
       in accordance with their respective terms except as (i) the
       enforceability thereof may be limited by bankruptcy, insolvency or
       similar laws affecting creditors' rights generally and (ii) rights of
       acceleration and the availability of equitable remedies may be limited by
       equitable principles of general applicability.

                 We are members of the Bar of the State of New York and the
       foregoing opinion is limited to the laws of the State of New York, the
       federal laws of the United States of America and the General Corporation
       Law of the State of Delaware.  In giving the foregoing opinion, we
       express no opinion as to the effect (if any) of any law of any
       jurisdiction (except the State of New York) in which any Bank is located
       which limits the rate of interest that such Bank may charge or collect.

                 This opinion is rendered solely to you in connection with the
       above matter.  This opinion may not be relied upon by you for any other
       purpose or relied upon by or furnished to any other person without our
       prior written consent.

                                      Very truly yours,

                                       2
<PAGE>

                                                        EXHIBIT G

                      ASSIGNMENT AND ASSUMPTION AGREEMENT

                 AGREEMENT dated as of _________, 19__ among [ASSIGNOR] (the
       "Assignor"), [ASSIGNEE] (the "Assignee"), UNUM CORPORATION (the
       "Borrower") and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the
       "Agent").

                              W I T N E S S E T H
                              - - - - - - - - - -

                 WHEREAS, this Assignment and Assumption Agreement (the
       "Agreement") relates to the Credit Agreement dated as of October 29, 1996
       among the Borrower, the Assignor and the other Banks party thereto, as
       Banks, and the Agent (the "Credit Agreement");

                 WHEREAS, as provided under the Credit Agreement, the Assignor
       has a Commitment to make Loans to the Borrower in an aggregate principal
       amount at any time outstanding not to exceed $__________;

                 WHEREAS, Committed Loans made to the Borrower by the Assignor
       under the Credit Agreement in the aggregate principal amount of
       $__________ are outstanding at the date hereof; and

                 WHEREAS, the Assignor proposes to assign to the Assignee all of
       the rights of the Assignor under the Credit Agreement in respect of a
       portion of its Commitment thereunder in an amount equal to $__________
       (the "Assigned Amount"), together with a corresponding portion of its
       outstanding Committed Loans, and the Assignee proposes to accept
       assignment of such rights and assume the corresponding obligations from
       the Assignor on such terms;

                 NOW, THEREFORE, in consideration of the foregoing and the
       mutual agreements contained herein, the parties hereto agree as follows:

                 SECTION 1.  Definitions. All capitalized terms not otherwise
                             -----------
       defined herein shall have the respective meanings set forth in the Credit
       Agreement.

                 SECTION 2.  Assignment.  The Assignor hereby
                             ----------
<PAGE>

       assigns and sells to the Assignee all of the rights of the Assignor under
       the Credit Agreement to the extent of the Assigned Amount, and the
       Assignee hereby accepts such assignment from the Assignor and assumes all
       of the obligations of the Assignor under the Credit Agreement to the
       extent of the Assigned Amount, including the purchase from the Assignor
       of the corresponding portion of the principal amount of the Committed
       Loans made by the Assignor outstanding at the date hereof. Upon the
       execution and delivery hereof by the Assignor, the Assignee, the Borrower
       and the Agent and the payment of the amounts specified in Section 3
       required to be paid on the date hereof (i) the Assignee shall, as of the
       date hereof, succeed to the rights and be obligated to perform the
       obligations of a Bank under the Credit Agreement with a Commitment in an
       amount equal to the Assigned Amount, and (ii) the Commitment of the
       Assignor shall, as of the date hereof, be reduced by a like amount and
       the Assignor released from its obligations under the Credit Agreement to
       the extent such obligations have been assumed by the Assignee. The
       assignment provided for herein shall be without recourse to the Assignor.

                 SECTION 3.  Payments.  As consideration for the assignment and
                             --------
       sale contemplated in Section 2 hereof, the Assignee shall pay to the
       Assignor on the date hereof in Federal funds the amount heretofore agreed
       between them. It is understood that commitment and/or facility fees
       accrued to the date hereof are for the account of the Assignor and such
       fees accruing from and including the date hereof are for the account of
       the Assignee.  Each of the Assignor and the Assignee hereby agrees that
       if it receives any amount under the Credit Agreement which is for the
       account of the other party hereto, it shall receive the same for the
       account of such other party to the extent of such other party's interest
       therein and shall promptly pay the same to such other party.

                 [SECTION 4.  Consent of the Borrower and the Agent.  This
                              -------------------------------------
       Agreement is conditioned upon the consent of the Borrower and the Agent
       pursuant to Section 9.06(c) of the Credit Agreement.  The execution of
       this Agreement by the Borrower and the Agent is evidence of this consent.
       Pursuant to Section 9.06(c) the Borrower agrees to execute

------------------
*      Amount should combine principal together with accrued interest and
       breakage compensation, if any, to be paid by the Assignee, net of any
       portion of any upfront fee to be paid by the Assignor to the Assignee. It
       may be preferable in an appropriate case to specify these amounts
       generically or by formula rather than as a fixed sum.

                                       2
<PAGE>

       and deliver a Note payable to the order of the Assignee to evidence the
       assignment and assumption provided for herein.]

                 SECTION 5.  Non-Reliance on Assignor.  The Assignor makes no
                             ------------------------
       representation or warranty in connection with, and shall have no
       responsibility with respect to, the solvency, financial condition, or
       statements of the Borrower, or the validity and enforceability of the
       obligations of the Borrower in respect of the Credit Agreement or any
       Note.  The Assignee acknowledges that it has, independently and without
       reliance on the Assignor, and based on such documents and information as
       it has deemed appropriate, made its own credit analysis and decision to
       enter into this Agreement and will continue to be responsible for making
       its own independent appraisal of the business, affairs and financial
       condition of the Borrower.

                 SECTION 6.  Governing Law.  This Agreement shall be governed by
                             -------------
       and construed in accordance with the laws of the State of New York.

                 SECTION 7.  Counterparts.  This Agreement may be signed in any
                             ------------
       number of counterparts, each of which shall be an original, with the same
       effect as if the signatures thereto and hereto were upon the same
       instrument.

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

                                      [ASSIGNOR]

                                      By_________________________
                                        Title:

                                      [ASSIGNEE]

                                      By__________________________
                                        Title:

                                       3
<PAGE>

                                      UNUM CORPORATION

                                      By__________________________
                                        Title:

                                      MORGAN GUARANTY TRUST COMPANY
                                        OF NEW YORK

                                      By__________________________
                                        Title:

                                       4
<PAGE>

                                                                  CONFORMED COPY

                      AMENDMENT NO. 1 TO CREDIT AGREEMENT

     AMENDMENT dated as of June 30, 1997 (the "Amendment") to the Credit
Agreement dated as of October 29, 1996 (the "Credit Agreement") among UNUM
CORPORATION (the "Borrower"), the BANKS listed therein (the "Banks") and MORGAN
GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the "Agent").

                             W I T N E S S E T H :

     WHEREAS, the parties hereto desire to amend the Credit Agreement to allow
the Borrower to present quarterly financial information consolidated in
accordance  with GAAP when certain conditions are satisfied;

     NOW, THEREFORE, the parties hereto agree as follows:

     Section 1.  Defined Terms; References.  Unless otherwise specifically
defined herein, each term used herein which is defined in the Credit Agreement
has  the meaning assigned to such term in the Credit Agreement. Each reference
to  "hereof", "hereunder", "herein" and "hereby" and each other similar
reference and  each reference to "this Agreement" and each other similar
reference contained in  the Credit Agreement shall, after this Amendment becomes
effective, refer to the  Credit Agreement as amended hereby.

     Section 2.  Financial Information.  (a) Section 5.01(a) of the Credit
Agreement is deleted in its entirety.
<PAGE>

     (b) Section 5.01 of the Credit Agreement is further hereby amended by
adding a new sentence at the end of thereof to read as follows:

     "The Borrower shall be deemed to have delivered the financial statements
referred to in subsection (c) and (d) above when it has (i) posted such
financials on the Internet website of the Securities and Exchange Commission
(http://www.sec.gov) or on the Internet website of the Borrower as it shall have
previously provided to the Banks, and (ii) notified the Banks of such posting;
provided if a Bank requests the financial statements to be delivered in hard
copies, the Borrower shall furnish to the Bank such statements accordingly."

     Section 3.  Representations of Borrower.  The Borrower represents and
warrants that (i) the representations and warranties of the Borrower set forth
in  Article 4 of the Credit Agreement are true and (ii) no Default has occurred
and is  continuing.

     Section 4.  Governing Law.  This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.

     Section 5.  Counterparts.  This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

     Section 6.  Effectiveness.  This Amendment shall become effective as of
the date hereof when the Agent shall have received (on or prior to August 22,
1997) from each of the Borrower and the Required Banks a counterpart hereof.

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first above written.

                         UNUM CORPORATION

                         By:/s/    Timothy W. Ludden
                            ----------------------------------
                            Name:  Timothy W. Ludden
                            Title: Vice President and
                                    Corporate Treasurer

                         2211 Congress Street
                         Portland, Maine 04122
                         Telecopy Number: 207-770-4387

                                       3
<PAGE>

                         MORGAN GUARANTY TRUST COMPANY OF NEW YORK

                         By:/s/    Jerry J. Fall
                            ---------------------------------
                            Name:  Jerry J. Fall
                            Title: Vice President

                         ABN AMRO BANK N.V., NEW YORK BRANCH

                         By:/s/    Bruce D. Ballentine
                            ----------------------------------
                            Name:  Bruce D. Ballentine
                            Title: Vice President

                         By:/s/    Victor J. Fennon
                            ----------------------------------
                            Name:  Victor J. Fennon
                            Title: Vice President

                         THE BANK OF NEW YORK

                         By:/s/    Lizanne T. Eberle
                            ---------------------------------
                            Name:  Lizanne T. Eberle
                            Title: Vice President

                         BANK OF TOKYO-MITSUBISHI TRUST COMPANY

                                       4
<PAGE>

                         By:/s/    J. Beckwith
                            ---------------------------------
                            Name:  J. Beckwith
                            Title: Vice President

                         FLEET BANK OF MAINE

                         By:/s/    Tracy L. Hawkins
                            --------------------------------
                            Name:  Tracy L. Hawkins
                            Title: Vice President

                         MELLON BANK, N.A.

                         By:/s/    Joanna Patterson
                            --------------------------------
                            Name:  Joanna Patterson
                            Title: Officer

                         WACHOVIA BANK OF GEORGIA, N.A.

                         By:/s/ Kathleen H. Reedy
                            --------------------------------
                            Name:  Kathleen H. Reedy
                            Title: Vice President

                         BANKBOSTON, N.A.

                         By:/s/    Karen A. Gallagher

                                       5
<PAGE>

                            ---------------------------------
                            Name:  Karen A. Gallagher
                            Title: Vice President

                         THE CHASE MANHATTAN BANK

                         By:
                            ---------------------------------
                            Name:
                            Title:

                         CIBC INC.

                         By:/s/    Edward C. Neu
                            --------------------------------
                            Name:  Edward C. Neu
                            Title: Authorized Signatory

                         THE DAI-ICHI KANGYO BANK, LTD., NEW YORK BRANCH

                         By:/s/    Masaaki Ishikura
                            -------------------------------
                            Name:  Masaaki Ishikura
                            Title: Vice President

                         THE FIRST NATIONAL BANK OF CHICAGO

                         By:/s/    S. W. Bridges

                                       6
<PAGE>

                            ------------------------------------
                            Name:  S.W. Bridges
                            Title: First Vice President

                         THE INDUSTRIAL BANK OF JAPAN, LIMITED, NEW YORK BRANCH

                         By:/s/    Masahiro Ito
                            -------------------------------------
                            Name:  Masahiro Ito
                            Title: Senior Vice President

                         THE SUMITOMO BANK, LIMITED, NEW YORK BRANCH

                         By:/s/    John C. Kissinger
                            -------------------------------------
                            Name:  John C. Kissinger
                            Title: Joint General Manager

                         CREDIT LYONNAIS  NEW YORK BRANCH

                         By:/s/    Sebastian Rocco
                            -----------------------------------
                            Name:  Sebastian Rocco
                            Title: First Vice President

                         MORGAN GUARANTY TRUST COMPANY OF NEW YORK,

                                       7
<PAGE>

                            as Agent

                         By:/s/    Ann E. Darby
                            ----------------------------------
                            Name:  Ann E. Darby
                            Title: Vice President

                         60 Wall Street
                         New York, New York 10260-0060
                         Attention:   Ann E. Darby
                         Telecopy number:   212-648-5249

                                       8
<PAGE>

                                                                  CONFORMED COPY

                      AMENDMENT NO. 2 TO CREDIT AGREEMENT

     AMENDMENT dated as of June 17, 1999 to the Credit Agreement dated as of
October 29, 1996 (as heretofore amended, the "Credit Agreement") among UNUM
CORPORATION (the "Borrower"), the BANKS party thereto (the "Banks") and MORGAN
GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the "Agent").

                              W I T N E S S E T H :

     WHEREAS, the Borrower proposes to merge (the "Merger") with and into
Provident Companies, Inc., a Delaware corporation, which would substantially
simultaneously therewith change its name to UNUMProvident Corporation;

     WHEREAS, the parties hereto desire to modify the Agreement to accommodate
the Merger;

     NOW, THEREFORE, the parties hereto agree as follows:

     Section 1.  Defined Terms; References.  Unless otherwise specifically
defined herein, each term used herein which is defined in the Credit Agreement
has the meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall, after this Amendment becomes effective,
refer to the Credit Agreement as amended hereby.

     Section 2.  Approval of Instrument of Assumption.   The Agent and the Banks
approve the form and substance of Exhibit A hereto for purposes of Section
5.05(c)(II)(i) of the Credit Agreement.

     Section 3.  Amendment to Limitation on Liens.  Section 5.06 of the Credit
Agreement is amended by adding a new subsection (g) at the end thereof as
follows:

     "(g) Liens on (i) marketable direct obligations issued or unconditionally
guaranteed or insured by the United States of America or any agency or
<PAGE>

instrumentality thereof and backed by the full faith and credit of the United
States of America sold by the Borrower or any of its Subsidiaries under a
repurchase agreement with a bank or a primary dealer of United States government
securities (a "Repo Counterparty") maturing within 90 days from the date of
sale, provided that the terms of such agreement comply with the guidelines set
      --------
forth in the Federal Financial Institutions Examination Council Supervisory
Policy -- Repurchase Agreements of Depositary Institutions With Securities
Dealers and Others, as adopted by the Comptroller of the Currency on October 31,
1985 (or any successor guidelines) and (ii) other marketable debt securities
under a repurchase agreement and/or securities lending agreement with a bank or
a primary dealer of such securities (the "Counterparty") maturing within 90 days
from the date of sale if the terms of such agreement comply with such
guidelines; provided that, in the case of any mortgage-backed security subject
            --------
to such an arrangement, the Counterparty thereof may, in lieu of returning such
security, return another mortgaged-backed security of the same value, yield and
rating, and otherwise having comparable economic terms; provided further that
                                                        --------
the Borrower and its Subsidiaries will continue their policies in effect on the
date hereof requiring collateral from their Repo Counterparties and
Counterparties."

     Section 4.  Amendment to Events of Default.  Section 6.01(k) of the Credit
Agreement is amended by the addition of the phrase "commencing on or after the
effective date of the merger between UNUM Corporation and Provident Companies,
Inc." immediately following the phrase "during any period of twelve consecutive
calendar months".

     Section 5.  Updated Representations. (a) Each reference to "1995" in the
definition of "Borrower's 1995 Form 10-K" and in Sections 4.04(a), 4.04(c) and
4.04(e) of the Credit Agreement is replaced with "1998".

     (b) Each reference to "June 30, 1996" in Sections 4.04(b), 4.04(d), 4.04(f)
and 4.04(g) of the Credit Agreement is replaced with "March 31, 1999".

     (c) Each reference to "six" in Sections 4.04(b), 4.04(d) and 4.04(f) of the
Credit Agreement is replaced with "three".

     Section 6.  Representations of Borrower.  The Borrower represents and
warrants that (i) the representations and warranties of the Borrower set forth
in Article 4 of the Credit Agreement will be true on and as of the Amendment
Effective Date and (ii) no Default will have occurred and be continuing on such
date.

     Section 7.  Governing Law.  This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.

                                       2
<PAGE>

     Section 8.  Counterparts.  This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

     Section 9.  Effectiveness.  This Amendment shall become effective as of the
effective date of the Merger (the "Amendment Effective Date") subject to receipt
by the Agent of (i) duly executed counterparts hereof signed by the Borrower and
the Required Banks (or, in the case of any party as to which an executed
counterpart shall not have been received, the Agent shall have received
telegraphic, telex or other written confirmation from such party of execution of
a counterpart hereof by such party);  (ii) a duly executed Assumption Agreement
substantially in the form of Exhibit A hereto; (iii) an opinion of counsel for
the Borrower satisfactory to the Agent as to compliance with Section 5.05 of the
Credit Agreement and as to such other matters relating to the transactions
contemplated by this Amendment as the Agent may reasonably request, such opinion
to be in form and substance satisfactory to the Agent; and (iv) all documents
the Agent may reasonably request relating to the existence of the Borrower, the
corporate authority for and the validity of this Amendment and the Merger.

                                       3
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first above written.

                                        UNUM CORPORATION

                                        By: /s/ Timothy W. Ludden
                                            --------------------------
                                        Title: Vice President and Treasurer
<PAGE>

                                        REVOLVING COMMITMENT VEHICLE
                                        CORPORATION
                                        By:  Morgan Guaranty Trust Company of
                                             New York, as Attorney-in-fact for
                                             Revolving Commitment Vehicle
                                             Corporation

                                        By: /s/ David Weintrob
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                        ABN AMRO BANK N.V.,
                                        NEW YORK BRANCH

                                        By: /s/ Parker H. Douglas
                                            --------------------------
                                        Title: Group Vice President

                                        By: /s/ Robert L. Chevlin
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                        THE BANK OF NEW YORK

                                        By: /s/ Robert V. Masi
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                        BANK OF TOKYO-MITSUBISHI
                                        TRUST COMPANY

                                        By: /s/ John E. Beckwith
                                            --------------------------
                                        Title: Vice President and Manager
<PAGE>

                                        FLEET BANK OF MAINE

                                        By: /s/ Tracy L. Hawkins
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                        MELLON BANK, N.A.

                                        By: /s/ Susan M. Whitewood
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                        WACHOVIA BANK OF GEORGIA, N.A.

                                        By: /s/ Kathleen H. Reedy
                                            --------------------------
                                        Title: Senior Vice President
<PAGE>

                                        BANKBOSTON, N.A.

                                        By: /s/ Stewart P. Neff
                                            --------------------------
                                        Title: Managing Director
<PAGE>

                                        THE CHASE MANHATTAN BANK

                                        By: /s/ Lawrence M. Karp
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                        CIBC INC.

                                        By:
                                            --------------------------
                                        Title:
                                               -----------------------
<PAGE>

                                        THE DAI-ICHI KANGYO BANK, LTD.,
                                        NEW YORK BRANCH

                                        By: /s/ Masaaki Ishikura
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                        THE FIRST NATIONAL BANK OF CHICAGO

                                        By: /s/ Samuel W. Bridges
                                            --------------------------
                                        Title: First Vice President
<PAGE>

                                        THE INDUSTRIAL BANK OF JAPAN,
                                        LIMITED, NEW YORK BRANCH

                                        By: /s/ Takuya Honjo
                                            --------------------------
                                        Title: Senior Vice President
<PAGE>

                                        THE SUMITOMO BANK, LIMITED, NEW
                                        YORK BRANCH

                                        By: /s/ C. Michael Garrido
                                            --------------------------
                                        Title: Senior Vice President
<PAGE>

                                        BANK OF MONTREAL,
                                        CHICAGO BRANCH

                                        By: /s/ Brian L. Banke
                                            --------------------------
                                        Title: Director
<PAGE>

                                        FIRST UNION NATIONAL BANK

                                        By: /s/ Thomas L. Stitchberry
                                            --------------------------
                                        Title: Senior Vice President
<PAGE>

                                        MORGAN GUARANTY TRUST COMPANY OF
                                        NEW YORK, as Agent

                                        By: /s/ Maria H. Dell'Aquila
                                            --------------------------
                                        Title: Vice President
<PAGE>

                                                                       EXHIBIT A

                              ASSUMPTION AGREEMENT

     UNUMProvident Corporation, a Delaware corporation ("UNUMProvident"), the
surviving corporation of the merger on the date hereof of UNUM Corporation, a
Delaware corporation ("UNUM"), with and into UNUMProvident, hereby expressly
assumes, and agrees to perform and discharge, all of the terms, covenants and
agreements of the Borrower under the Credit Agreement (as amended, the "Credit
Agreement") dated as of October 29, 1996 among UNUM, the Banks party thereto and
Morgan Guaranty Trust Company of New York, as Agent (as such Credit Agreement
may from time to time be in effect) and the Notes, including, without
limitation, the due and punctual payment of the principal of and interest on the
Loans and of all other amounts payable by the Borrower under the Credit
Agreement.  All references in the Credit Agreement to the "Borrower" shall
hereafter refer to UNUMProvident  and its successors. All capitalized terms not
otherwise defined herein shall have the respective meanings set forth in the
Credit Agreement.

     IN WITNESS WHEREOF, UNUMProvident has caused its duly authorized officer to
execute and deliver this Assumption Agreement as of ______________, 1999,
simultaneously with the effectiveness of the merger referred to above.

                                        UNUMProvident Corporation,
                                        formerly Provident Companies,
                                        Inc.
<PAGE>

                                        By
                                            --------------------------
                                        Title:
                                               -----------------------
<PAGE>

                                                                [CONFORMED COPY]

                      AMENDMENT NO. 3 TO CREDIT AGREEMENT

     AMENDMENT dated as of March 1, 2000 to the Credit Agreement dated as of
October 29, 1996 (as heretofore amended, the "Credit Agreement") among
UNUMPROVIDENT CORPORATION (successor to UNUM Corporation) (the "Borrower"), the
BANKS party thereto (the "Banks") and MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Agent (the "Agent").

     The parties hereto agree as follows:

     Section a.  Defined Terms; References.  Unless otherwise specifically
defined herein, each term used herein which is defined in the Credit Agreement
has the meaning assigned to such term in the Credit Agreement. Each reference to
"hereof", "hereunder", "herein" and "hereby" and each other similar reference
and each reference to "this Agreement" and each other similar reference
contained in the Credit Agreement shall, after this Amendment becomes effective,
refer to the Credit Agreement as amended hereby.

     Section b.  Amendment.  The phrase "within 100 days" in Section 5.01(b) of
the Credit Agreement is amended to read "within (x) 130 days, in the case of the
fiscal year ended December 31, 1999, and (y) 100 days, in the case of any
subsequent fiscal year,".

     Section c.  Governing Law.  This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.

     Section d.  Counterparts.  This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

     Section e.  Effectiveness.  This Amendment shall become effective as of
the date hereof upon receipt by the Agent of duly executed counterparts hereof
signed by the Borrower and the Required Banks (or, in the case of any party as
to which an executed counterpart shall not have been received, the Agent shall
have received telegraphic, telex or other written confirmation from such party
of execution of a counterpart hereof by such party).
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the date first above written.

                                        UNUMPROVIDENT CORPORATION

                                        By: /s/ John M. Lang Sr.
                                           ---------------------------
                                        Title: Senior Vice President &
                                               Treasurer

                                        REVOLVING COMMITMENT VEHICLE
                                        CORPORATION
                                        By:  Morgan Guaranty Trust Company of
                                             New York, as Attorney-in-fact for
                                             Revolving Commitment Vehicle
                                             Corporation

                                        By: /s/ David P. Weintrob
                                            --------------------------
                                        Title: Vice President

                                        MORGAN GUARANTY TRUST
                                        COMPANY OF NEW YORK, as Agent

                                        By: /s/ Maria H. Dell'Aquila
                                            --------------------------
                                        Title: Vice President

                                       2
<PAGE>

                                        ABN AMRO BANK N.V., NEW YORK
                                        BRANCH

                                        By:
                                            --------------------------
                                        Title:
                                               -----------------------

                                        By:
                                            --------------------------
                                        Title:
                                               -----------------------
                                        THE BANK OF NEW YORK

                                        By: /s/ Robert V. Masi
                                            --------------------------
                                        Title: Vice President

                                        BANK OF TOKYO-MITSUBISHI TRUST
                                        COMPANY

                                        By: /s/ Sally Morse
                                            --------------------------
                                        Title: Vice President

                                        FLEET BANK OF MAINE

                                       3
<PAGE>

                                        By: /s/ Tracy L. Hawkins
                                            --------------------------
                                        Title: Vice President

                                        MELLON BANK, N.A.

                                        By: /s/ Karla K. Maloof
                                            --------------------------
                                        Title: Vice President

                                        WACHOVIA BANK OF GEORGIA, N.A.

                                        By: /s/ Jeffrey A. Simpson
                                            --------------------------
                                        Title: Senior Vice President

                                        FLEET NATIONAL BANK
                                        (f/k/a BANKBOSTON, N.A.)

                                        By: /s/ Tracy L. Hawkins
                                            --------------------------
                                        Title: Loan Officer

                                        THE CHASE MANHATTAN BANK

                                        By: /s/ Heather A. Lindstrom
                                            --------------------------
                                        Title: Vice President

                                       4
<PAGE>

                                        CIBC INC.

                                        By: /s/ Robert Mendeles
                                            --------------------------
                                        Title: Executive Director

                                        THE DAI-ICHI KANGYO BANK, LTD.,
                                        NEW YORK BRANCH

                                        By: /s/ Anne Marie Heverin
                                            --------------------------
                                        Title: Credit Officer

                                        BANK ONE, NA

                                        By: /s/ Samuel W. Bridges
                                            --------------------------
                                        Title: First Vice President

                                       5
<PAGE>

                                        THE INDUSTRIAL BANK OF JAPAN,
                                        LIMITED, NEW YORK BRANCH

                                        By: /s/ Takuya Honjo
                                            --------------------------
                                        Title: Deputy General Manager

                                        THE SUMITOMO BANK, LIMITED, NEW
                                        YORK BRANCH

                                        By:
                                            --------------------------
                                        Title:
                                               -----------------------

                                        BANK OF MONTREAL

                                        By: /s/ Kanu Modi
                                            --------------------------
                                        Title: Director

                                        FIRST UNION NATIONAL BANK

                                        By: /s/ Thomas L. Stitchberry
                                            --------------------------
                                        Title: Senior Vice President

                                       6<PAGE>

                                                                    Exhibit 10-m

                              EMPLOYMENT AGREEMENT
                              --------------------

     AGREEMENT by and between AmSouth Bancorporation, a Delaware corporation
(the "Company") and C. Dowd Ritter (the "Executive") dated as of the 4th day of
October, 1999.

     The Company has determined that it is in the best interests of the Company
and its shareholders to assure that the Company will have the continued
dedication of the Executive. Therefore, in order to accomplish this objective,
the Board of Directors of the Company has caused the Company to enter into this
Agreement.

     NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

     1.  Effective Date.  The "Effective Date" shall mean the date hereof, and
         --------------
the Executive's Employment Agreement dated December 18, 1997 (the "Prior
Agreement"), is hereby superseded and is void, except as provided in Section
3(b)(i) below.

     2.  Employment Period.  The Company hereby agrees to employ the Executive,
         -----------------
and the Executive hereby agrees to enter into the employ of the Company subject
to the terms and conditions of this Agreement, for the period commencing on the
Effective Date and ending on the fifth anniversary thereof (the "Employment
Period"); provided, however, that commencing on the date one year after the date
hereof, and on each annual anniversary of such date (such date and each annual
anniversary thereof shall be hereinafter referred to as the "Renewal Date"),
unless previously terminated, the Employment Period shall be automatically
extended so as to terminate on the earlier of (x) five years from such Renewal
Date and (y) the Executive's 62nd birthday, unless at least 60 days prior to the
Renewal Date the Company shall give notice to the Executive that the Employment
Period shall not be so extended.

     3.  Terms of Employment.  (a)  Position and Duties.  (i)  (A) During the
         -------------------        -------------------
Employment Period, the Executive shall serve as Chief Executive Officer and
President of the Company with such authority, duties and responsibilities as are
commensurate with such position and as may be consistent with such position and
(B) the Executive's services shall be performed in Birmingham, Alabama.  Upon
the earlier of (x) January 2, 2001, or (y) Dennis C. Bottorff ceasing to be
Chairman of the Company, the Executive shall be elected Chairman of the
Company's Board of Directors for the remainder of the Employment Period.  The
Executive shall serve on the Company's Board of Directors during the entire
Employment Period.

     (ii) During the Employment Period, and excluding any periods of vacation
and sick leave to which the Executive is entitled, the Executive agrees to
devote substantially all of his attention and time during normal business hours
to the business and affairs of the Company and,
<PAGE>

to the extent necessary to discharge the responsibilities assigned to the
Executive hereunder, to use the Executive's reasonable best efforts to perform
faithfully and efficiently such responsibilities. During the Employment Period
it shall not be a violation of this Agreement for the Executive to (A) serve on
corporate, civic or charitable boards or committees, (B) deliver lectures,
fulfill speaking engagements or teach at educational institutions and (C) manage
personal investments, so long as such activities do not significantly interfere
with the performance of the Executive's responsibilities as an employee of the
Company in accordance with this Agreement. It is expressly understood and agreed
that to the extent that any such activities have been conducted by the Executive
prior to the Effective Date, the continued conduct of such activities (or the
conduct of activities similar in nature and scope thereto) subsequent to the
Effective Date shall thereafter be deemed not to interfere with the performance
of the Executive's responsibilities to the Company.

     (b)  Compensation.
          ------------

          (i)   Base Salary.  Effective October 16, 1999, and during the
                -----------
Employment Period, the Executive shall receive an annual base salary ("Annual
Base Salary") of no less than $900,000. From the Effective Date through October
15, 1999, the Executive's Annual Base Salary shall be the same as was in effect
immediately prior to the Effective Date. The Annual Base Salary shall be
reviewed no less frequently than annually, and, if increased, the term "Annual
Base Salary" shall refer to such increased amount.

          (ii)  Annual Bonus.  During the Employment Period, the Executive shall
                ------------
be eligible to receive an annual cash bonus under the Company's Executive
Incentive Plan or any successor thereto ("Annual Bonus") based on performance
criteria determined by the Compensation Committee of the Company's Board of
Directors that provides the Executive with a target bonus of 100% of his Annual
Base Salary and with an opportunity to earn up to 200% of his Annual Base
Salary.

          (iii) Incentive Awards.  On the Effective Date, the Company shall
                ----------------
grant the Executive 100,000 shares of restricted stock of the Company (the
"Restricted Stock") pursuant to the terms of the Company's stock incentive plan.
The Executive shall be granted stock options to acquire 400,000 shares of the
Company's common stock (the "Stock Options") with a strike price equal to the
fair market value of the stock subject thereto on the date of grant, as provided
in the Company's stock incentive plan.

     The Restricted Stock and Stock Options will vest according to the following
schedule:

                                Restricted Stock
                                ----------------

                33,333                  Third anniversary hereof
                33,333                  Fourth anniversary hereof
                33,334                  Fifth anniversary hereof

                                      -2-
<PAGE>

                                 Stock Options
                                 -------------

                133,333                 Third anniversary hereof
                133,333                 Fourth anniversary hereof
                133,334                 Fifth anniversary hereof

          (iv)  Retirement Benefits.  So long as the Executive continues to
                -------------------
serve as the chief executive officer of the Company until at least his 55th
birthday, he shall accrue an increasing total annual retirement benefit assuming
retirement at age 62 as set forth in the chart below (the "Total Retirement
Benefit").  "Final Average Pay" means the average of the sum of his highest
Annual Base Salary and Annual Bonuses for three of the five years prior to his
retirement.

<TABLE>
<CAPTION>

Age at Which                Accrual Factor for          Early Payment           Total Retirement
Retirement Benefits          Replacement % of          Reduction Factor              Benefit
Begin                       Final Average Pay
                                 Assuming
                           Retirement at Age 62
--------------------------------------------------------------------------------------------------
<S>                      <C>                       <C>                       <C>
55 years old                  53%                       79%                  41.87% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
56 years old                  54%                       82%                  44.28% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
57 years old                  55%                       85%                  46.75% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
58 years old                  56%                       88%                  49.28% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
59 years old                  57%                       91%                  51.87% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
60 years old                  58%                       94%                  54.52% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
61 years old                  59%                       97%                  57.23% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
62 years old                  60%                      100%                  60% of Final
                                                                             Average Pay
--------------------------------------------------------------------------------------------------
</TABLE>

                                      -3-
<PAGE>

The Total Retirement Benefit shall equal the total of the amounts payable to the
Executive under  the Company's qualified and non-qualified defined benefit
pension plans (the "Pension Plans") plus the additional amount necessary in
order to achieve the percentages of Final Average Pay specified above.  The fact
that the Executive is receiving the portion of the Total Retirement Benefit
called for by this agreement shall not reduce or otherwise affect his existing
participation in the Pension Plans.  Upon the Executive's death, his current
spouse, should she survive the Executive, shall be paid, for life, an annual
benefit of 50% of the Total Retirement Benefit which would otherwise be payable
to the Executive.

          (v)    Other Employee Benefit Plans.  During the Employment Period,
                 ----------------------------
except as otherwise expressly provided herein, the Executive shall be entitled
to participate in all employee benefit, welfare and other plans, practices,
policies and programs generally applicable to senior executives of the Company
on a basis no less favorable than his participation immediately prior to the
Effective Date as set forth in the Prior Agreement provided that upon the
Executive's termination of employment for any reason, the Company shall continue
to provide him and his current spouse with medical and dental benefits for the
remainder of their lives on a basis no less favorable than those benefits were
provided to them immediately prior to such termination.

          (vi)   Expenses.  During the Employment Period, the Executive shall
                 --------
be entitled to receive prompt reimbursement for all reasonable expenses incurred
by the Executive in accordance with the Company's policies.

          (vii)  Vacation.  During the Employment Period, the Executive shall
                 --------
be entitled to paid vacation in accordance with the plans, policies, programs
and practices of the Company and its affiliated companies as in effect with
respect to the senior executives of the Company.

          (viii) The Company shall provide the Executive with a Supplemental
Life Insurance Policy which will replace the group term life insurance beyond
$50,000 provided by the Company and will take into account the maximum coverage
amounts allowed under the group term policy.  This Supplemental Life Insurance
will be provided in the form of a survivorship policy which will be funded on
the basis of a split dollar endorsement method.  The Company will meet its
obligation to pay its portion of premiums and meet all other commitments to the
Executive under the policy.

     4.   Termination of Employment.  (a)  Death or Disability.  The Executive's
          -------------------------        -------------------
employment shall terminate automatically upon the Executive's death during the
Employment Period. If the Company determines in good faith that the Disability
of the Executive has occurred during the Employment Period (pursuant to the
definition of Disability set forth below), it may give

                                      -4-
<PAGE>

to the Executive written notice in accordance with Section 12(b) of this
Agreement of its intention to terminate the Executive's employment. In such
event, the Executive's employment with the Company shall terminate effective on
the 30th day after receipt of such notice by the Executive (the "Disability
Effective Date"), provided that, within the 30 days after such receipt, the
Executive shall not have returned to full-time performance of the Executive's
duties. For purposes of this Agreement, "Disability" shall mean the absence of
the Executive from the Executive's duties with the Company on a full-time basis
for 180 consecutive business days as a result of incapacity due to mental or
physical illness which is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Executive or the
Executive's legal representative.

          (b) Cause.  The Company may terminate the Executive's employment
              -----
during the Employment Period for Cause.  For purposes of this Agreement, "Cause"
shall mean:

              (i)  the continued failure of the Executive to perform
substantially the Executive's duties with the Company or one of its affiliates
(other than any such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is delivered to the
Executive by the Board which specifically identifies the manner in which the
Board believes that the Executive has not substantially performed the
Executive's duties, or

              (ii)  the willful engaging by the Executive in illegal conduct or
gross misconduct which is materially and demonstrably injurious to the Company,
or

              (iii) conviction of a felony or guilty or nolo contendere plea by
the Executive with respect thereto.

For purposes of this provision, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith or without reasonable belief that the
Executive's action or omission was in the best interests of the Company.  Any
act, or failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or based upon the advice of counsel for the Company shall
be conclusively presumed to be done, or omitted to be done, by the Executive in
good faith and in the best interests of the Company.  The cessation of
employment of the Executive shall not be deemed to be for Cause unless and until
there shall have been delivered to the Executive a copy of a resolution duly
adopted by the affirmative vote of not less than two-thirds of the entire
membership of the Board at a meeting of the Board called and held for such
purpose (after reasonable notice is provided to the Executive and the Executive
is given an opportunity, together with counsel, to be heard before the Board),
finding that, in the good faith opinion of the Board, the Executive is guilty of
the conduct described in subparagraph (i) or (ii) above, and specifying the
particulars thereof in detail.

          (c) Good Reason.  The Executive's employment may be terminated by the
              -----------
Executive for Good Reason.  For purposes of this Agreement, "Good Reason" shall
mean in the absence of a written consent of the Executive a material breach by
the Company of a material term

                                      -5-
<PAGE>

of this Agreement, after the Company has been given notice thereof and a
reasonable opportunity to cure such breach.

          (d) Notice of Termination.  Any termination by the Company for Cause,
              ---------------------
or by the Executive for Good Reason, shall be communicated by Notice of
Termination to the other party hereto given in accordance with Section 12(b) of
this Agreement.  For purposes of this Agreement, a "Notice of Termination" means
a written notice which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) to the extent applicable, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated and (iii) if the
Date of Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more  than
thirty days after the giving of such notice).  The failure by the Executive or
the Company to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Good Reason or Cause shall not waive any right
of the Executive or the Company, respectively, hereunder or preclude the
Executive or the Company, respectively, from asserting such fact or circumstance
in enforcing the Executive's or the Company's rights hereunder.

          (e) Date of Termination.  "Date of Termination" means (i) if the
              -------------------
Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein within 30 days of such notice, as the case may
be, (ii) if the Executive's employment is terminated by the Company other than
for Cause or Disability, the Date of Termination shall be the date on which the
Company notifies the Executive of such termination and (iii) if the Executive's
employment is terminated by reason of death or Disability, the Date of
Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.

          5.   Obligations of the Company upon Termination.  (a) Good Reason;
               -------------------------------------------       ------------
Other Than for Cause, Death or Disability.  If, during the Employment Period,
-----------------------------------------
the Company shall terminate the Executive's employment other than for Cause or
Disability or the Executive shall terminate employment for Good Reason:

               (i)  the Company shall pay to the Executive in a lump sum in cash
within 30 days after the Date of Termination the aggregate of the following
amounts:

               A.  the sum of (1) the Executive's Annual Base Salary through the
          Date of Termination to the extent not theretofore paid, (2) the
          product of (x) the highest annual bonus paid to the Executive for any
          of the three years prior to the Date of Termination (the "Recent
          Annual Bonus") and (y) a fraction, the numerator of which is the
          number of days that have elapsed in the fiscal year in which the Date
          of Termination occurs as of the Date of Termination, and the
          denominator of which is 365, and (3) any compensation previously
          deferred by the Executive (together with any accrued interest or
          earnings thereon) and any accrued vacation pay, in each case

                                      -6-
<PAGE>

          to the extent not theretofore paid (the sum of the amounts described
          in clauses (1), (2) and (3) shall be hereinafter referred to as the
          "Accrued Obligations"); and

               B.  the amount equal to the product of (1) three and (2) the sum
          of (x) the Executive's Annual Base Salary, (y) the Recent Annual Bonus
          and (z) the value determined by an executive compensation consulting
          firm with a national reputation to be a competitive annual long term
          incentive grant (defined as a size-adjusted, 50th percentile grant as
          of the date of determination as compared to the Company's peer group);
          and

               C.   An amount equal to the Total Retirement Benefit Value less
          the Pension Plan Benefit Value, where:

               "Total Retirement Value" equals the lump sum actuarial
               equivalent, utilizing actuarial assumptions no less favorable to
               the Executive than those in effect under the Company's qualified
               defined benefit pension plan immediately prior to the Effective
               Date (the "Lump Sum Value"), of the Total Retirement Benefit
               provided under subsection 3(b)(iv) hereof, assuming (x) that the
               Executive is three years older than his actual age on the Date of
               Termination, (y) there shall be no deduction for early payment
               and (z) that for purposes of determining "Final Average Pay"
               under the benefit calculation the Executive's actual pay history
               as of the Date of Termination shall be used.  By way of
               illustration, if the Executive were age 58 on the Date of
               Termination, then the Total Retirement Benefit Value would be the
               Lump Sum Value of an annual retirement benefit equal to 59% of
               the Executive's actual Final Average Pay as of the Date of
               Termination.

               "Pension Plan Benefit Value" equals the Lump Sum Value on the
               Date of Termination of the Executive's benefit under the
               Company's qualified defined benefit pension plan.

          The payment provided under this subsection 5(a)(i)(C) shall be made in
          lieu of, and shall completely supersede and replace the Total
          Retirement Benefit otherwise payable under subsection 3(b)(iv) hereof,
          other than the portion thereof payable under the Company's qualified
          defined benefit pension plan.

               D. An amount equal to the aggregate benefits accrued by the
          Executive as of the effective date of termination under the terms of
          the Supplemental Thrift Plan.  The payment provided under this
          Subsection 5(a)(i)(D) shall be made in lieu

                                      -7-
<PAGE>

          of, and shall completely supersede and replace, the Executive's
          benefits payable under the AmSouth Bancorporation Supplemental Thrift
          Plan.

              (ii)  the Restricted Stock and the Stock Options and any other
stock-based incentives awarded to the Executive shall vest immediately;

              (iii) The amount of the Executive's annual club dues bonus in
the year of termination, multiplied by three;

              (vi)  For a thirty-six-month period following the date of the
termination or until the Executive shall have obtained employment, comparable to
his position with the Company on the date of termination, whichever is earlier,
out-placement services, the scope and provider of which shall be selected by the
Executive in the Executive's sole discretion, shall be provided at the expense
of the Company, but not to exceed a reasonable cost;

              (v)   the Company shall transfer (or cause to be transferred) to
the Executive title to the Executive's Company car, without cost to the
Executive, and shall pay to the Executive a lump sum cash payment in an amount
necessary to fully gross-up the income tax effect of said transfer; and

              (vi)  to the extent not theretofore paid or provided, the Company
shall timely pay or provide to the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
under any plan, program, policy or practice or contract or agreement of the
Company and its affiliated companies through the Date of Termination (such other
amounts and benefits shall be hereinafter referred to as the "Other Benefits").

          (b) Death.  If the Executive's employment is terminated by reason of
              -----
the Executive's death during the Employment  Period, this Agreement shall
terminate without further obligations to the Executive's legal representatives
under this Agreement, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits.  In addition, the Restricted
Stock and Stock Options shall vest immediately.  Accrued Obligations shall be
paid to the Executive's estate or beneficiary, as applicable, in a lump sum in
cash within 30 days of the Date of Termination.  With respect to the provision
of Other Benefits, the term Other Benefits as utilized in this Section 5(b)
shall include death benefits as in effect on the date of the Executive's death
with respect to senior executives of the Company and their beneficiaries.

          (c) Disability.  If the Executive's employment is terminated by reason
              ----------
of the Executive's Disability during the Employment Period, this Agreement shall
terminate without further obligations to the Executive, other than for payment
of Accrued Obligations and the timely payment or provision of Other Benefits.
In addition, the Restricted Stock and Stock Options shall vest immediately.
Accrued Obligations shall be paid to the Executive in a lump sum in cash within
30 days of the Date of Termination.  With respect to the provision of Other
Benefits, the term Other Benefits as utilized in this  Section 5(c) shall
include, and the Executive shall be entitled after the

                                      -8-
<PAGE>

Disability Effective Date to receive, disability and other benefits as in effect
at any time thereafter generally with respect to senior executives of the
Company.

          (d) Cause; Other than for Good Reason.  If the Executive's employment
              ---------------------------------
shall be terminated for Cause or the Executive terminates his employment without
Good Reason during the Employment Period, this Agreement shall terminate without
further obligations to the Executive other than the obligation to pay to the
Executive (w) his Annual Base Salary through the Date of Termination, (x)
payment of the Retirement Benefit, and (y) Other Benefits, in each case to the
extent theretofore unpaid.

          6.   Non-exclusivity of Rights.  Except as specifically provided,
               -------------------------
nothing in this Agreement shall prevent or limit the Executive's continuing or
future participation in any plan, program, policy or practice provided by the
Company or any of its affiliated companies and for which the Executive may
qualify, nor, subject to Section 12(f), shall anything herein limit or otherwise
affect such rights as the Executive may have under any contract or agreement
with the Company or any of its affiliated companies.  Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any plan,
policy, practice or program of or any contract or agreement with the Company or
any of its affiliated companies at or subsequent to the Date of Termination
shall be payable in accordance with such plan, policy, practice or program or
contract or agreement except as explicitly modified by this Agreement.

          7.   Full Settlement.  The Company's obligation to make the payments
               ---------------
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Executive or others.  In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement and, such amounts
shall not be reduced whether or not the Executive obtains other employment.  The
Company agrees to pay as incurred, to the full extent permitted by law, all
legal fees and expenses which the Executive may reasonably incur as a result of
any contest (regardless of the outcome thereof) by the Company, the Executive or
others of the validity or  enforceability of, or liability under, any provision
of this Agreement or any guarantee of performance thereof (including as a result
of any contest by the Executive about the amount of any payment pursuant to this
Agreement), plus in each case interest on any delayed payment at the applicable
Federal rate provided for in Section 7872(f)(2)(A) of the Internal Revenue Code
of 1986, as amended (the "Code").

          8.   Certain Additional Payments by the Company.
               ------------------------------------------

          (a)  Anything in this Agreement to the contrary notwithstanding and
except as set forth below, in the event it shall be determined that any payment
or distribution by the Company to or for the benefit of the Executive (whether
paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any additional payments
required under this Section 8) (a "Payment") would be subject to the excise tax
imposed

                                      -9-
<PAGE>

by Section 4999 of the Code or any interest or penalties are incurred by the
Executive with respect to such excise tax (such excise tax, together with any
such interest and penalties, are hereinafter collectively referred to as the
"Excise Tax"), then the Executive shall be entitled to receive an additional
payment (a "Gross-Up Payment") in an amount such that after payment by the
Executive of all taxes (including any interest or penalties imposed with respect
to such taxes), including, without limitation, any income taxes (and any
interest and penalties imposed with respect thereto) and Excise Tax imposed upon
the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing
provisions of this Section 8(a), if it shall be determined that the Executive is
entitled to a Gross-Up Payment, but that the Payments do not exceed 110% of the
greatest amount (the "Reduced Amount") that could be paid to the Executive such
that the receipt of Payments would not give rise to any Excise Tax, then no
Gross-Up Payment shall be made to the Executive and the Payments, in the
aggregate, shall be reduced to the Reduced Amount.

          (b)  Subject to the provisions of Section 8(c), all determinations
required to be made under this Section 8, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up Payment and the assumptions
to be utilized in arriving at such determination, shall be made by the Company's
independent certified public accounting firm or such other certified public
accounting firm reasonably acceptable to the Company as may be designated by the
Executive (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Company and the Executive within 15 business days of
the receipt of  notice from the Executive that there has been a Payment, or such
earlier time as is requested by the Company.  All fees and expenses of the
Accounting Firm shall be borne solely by the Company.  Any Gross-Up Payment, as
determined pursuant to this Section 8, shall be paid by the Company to the
Executive within five days of the receipt of the Accounting Firm's
determination.  Any determination by the Accounting Firm shall be binding upon
the Company and the Executive.  As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial determination
by the Accounting Firm hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been made ("Underpayment"),
consistent with the calculations required to be made hereunder.  In the event
that the Company exhausts its remedies pursuant to Section 8(c) and the
Executive thereafter is required to make a payment of any Excise Tax, the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such Underpayment shall be promptly paid by the Company to or for the
benefit of the Executive.

          (c)  The Executive shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment by
the Company of the Gross-Up Payment.  Such notification shall be given as soon
as practicable but no later than ten business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid.  The
Executive shall not pay such claim prior to the expiration of the 30-day period
following the date on which he gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim
is due).  If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:

                                      -10-
<PAGE>

               (i)   give the Company any information reasonably requested by
the Company relating to such claim,

               (ii)  take such action in connection with contesting such claim
as the Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by the Company,

               (iii) cooperate with the Company in good faith in order
effectively to contest such claim, and

               (iv)  permit the Company to participate in any proceedings
relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses.  Without limitation on the foregoing provisions
of this Section 8(c), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or forgo any
and all administrative appeals, proceedings, hearings and conferences with the
taxing authority in respect of such claim and may, at its sole option, either
direct the Executive to pay the tax claimed and sue for a refund or contest the
claim in any permissible manner, and the Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay
such claim and sue for a refund, the Company shall advance the amount of such
payment to the Executive, on an interest-free basis and shall indemnify and hold
the Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of limitations relating
to payment of taxes for the taxable year of the Executive with respect to which
such contested amount is claimed to be due is limited solely to such contested
amount.  Furthermore, the Company's control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder and
the Executive shall be entitled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other taxing
authority.

          (d)  If, after the receipt by the Executive of an amount advanced by
the Company pursuant to Section 8(c), the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Section 8(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto).  If, after the receipt by the Executive
of an amount advanced by the Company pursuant to Section 8(c), a  determination
is made that the

                                      -11-
<PAGE>

Executive shall not be entitled to any refund with respect to such claim and
the Company does not notify the Executive in writing of its intent to contest
such denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid.

          9.  Confidential Information; Noncompetition.  (a)  The Executive
              ----------------------------------------
shall hold in a fiduciary capacity for the benefit of the Company all secret or
confidential information, knowledge or data relating to the Company or any of
its affiliated companies, and their respective businesses, which shall have been
obtained by the Executive during the Executive's employment by the Company or
any of its affiliated companies and which shall not be or become public
knowledge (other than by acts by the Executive or representatives of the
Executive in violation of this Agreement).  After termination of the Executive's
employment with the Company, the Executive shall not, without the prior written
consent of the Company or as may otherwise be required by law or legal process,
communicate or divulge any such information, knowledge or data to anyone other
than the Company and those designated by it.

          (b) Without the prior written consent of the Company, during the
Employment Period, and for twenty-four (24) months following the expiration of
this Agreement, the Executive shall not, as an employee or an officer, engage
directly or indirectly in any business or enterprise which is "in competition"
with the Company or its successors or assigns.  For purposes of this Agreement,
a business or enterprise will be deemed to be "in competition" if it is a
banking institution, the headquarters of which is within one hundred (100) miles
from the location of the Executive's  principal job location or office at the
time of termination of employment.  However, the Executive shall be allowed to
purchase and hold for investment less than three percent (3%) of the shares of
any corporation whose shares are regularly traded on a national securities
exchange or in the over-the-counter market.

          (c) In the event of a breach or threatened breach of this Section 9,
the Executive agrees that the Company shall be entitled to injunctive relief in
a court of appropriate jurisdiction to remedy any such breach or threatened
breach, the Executive acknowledges that damages would be inadequate and
insufficient.

          (d) Any termination of the Executive's employment or of this Agreement
shall have no effect on the continuing operation of this Section 9.  In no event
shall an asserted violation of the provisions of this Section 9 constitute a
basis for deferring or withholding any amounts otherwise payable to the
Executive under this Agreement.

          10.  Successors.  (a)  This Agreement is personal to the Executive and
               ----------
without the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution.  This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.

                                      -12-
<PAGE>

          (b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.

          (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place.  As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of
law, or otherwise.

          11.  Dispute Resolution.  The Executive shall have the right and
               ------------------
option to elect to have any good faith dispute or controversy arising under or
in connection with this agreement settled by litigation or by arbitration.  If
arbitration is selected, such proceeding shall be conducted before a panel of
three (3) arbitrators sitting in a location selected by the Executive within
fifty (50) miles from the location of his principal place of employment, in
accordance with the rules of the American Arbitration Association then in
effect.  Judgment may be entered on the award of the arbitrators in any court
having competent jurisdiction.  All expenses of such litigation or arbitration,
including the reasonable fees and expenses of the legal representative for the
Executive, and necessary costs and disbursements incurred as a result of such
dispute or legal proceeding, and any prejudgment interest, shall be borne by the
Company.

          12.  Miscellaneous.  (a)  This Agreement shall be governed by and
               -------------
construed in accordance with the laws of the State of Delaware, without
reference to principles of conflict of laws.  The captions of this Agreement are
not part of the provisions hereof and shall have no force or effect.  This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.

          (b) Any notices, requests, demands, or other communications provided
for by this Agreement shall be sufficient if in writing and if sent by
registered or certified mail to the Executive at the last address he has filed
in writing with the Company or, in the case of the Company, to the General
Counsel of the Company, at the Company's principal offices.  Notice and
communications shall be effective when actually received by the addressee.

          (c) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement.

          (d) The Company may withhold from any amounts payable under this
Agreement such Federal, state, local or foreign taxes as shall be required to be
withheld pursuant to any applicable law or regulation.

          (e) The Executive's or the Company's failure to insist upon strict
compliance with any provision of this Agreement or the failure to assert any
right the Executive or the Company

                                      -13-
<PAGE>

may have hereunder, including, without limitation, the right of the Executive to
terminate employment for Good Reason of this Agreement, shall not be deemed to
be a waiver of such provision or right or any other provision or right of this
Agreement.

          (f) From and after the Effective Date this Agreement shall supersede
any other employment, severance or change of control agreement between the
parties with respect to the subject matter hereof including the Prior Agreement,
except as expressly provided herein.

     IN WITNESS WHEREOF, the Executive has hereunto set the Executive's hand
and, pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name on its behalf, all as of the
day and year first above written.

                                    -----------------------------------
                                    C. DOWD RITTER

                                    AMSOUTH BANCORPORATION

                                    By --------------------------------

                                      -14-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00005-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00005-of-00352.parquet"}]]