Document:

EXHIBIT 10.1

                               THE BOEING COMPANY

                              AMENDED AND RESTATED
                                     364-DAY
                              BANK CREDIT AGREEMENT

                                      among

                               THE BOEING COMPANY
          and the Subsidiaries which are or shall become party hereto,
                                   as Borrower

                             THE BANKS PARTY HERETO

                                 CITIBANK, N.A.,
                             as Administrative Agent

                                       and

                            THE CHASE MANHATTAN BANK,
                              as Syndication Agent

                                       and

                            SALOMON SMITH BARNEY INC.

                                       and

                             CHASE SECURITIES, INC.

                                       as

                  Joint Lead Arrangers and Joint Book Managers

                         dated as of September 29, 1999

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

ARTICLE 1

<S>      <C>                                                                                                   <C>

         Section                                                                                               Page

         Section 1.02.  Use of Defined Terms.....................................................................80

         Section 1.03.  Accounting Terms.........................................................................81

ARTICLE 2

         Section 2.01.  The A Advances...........................................................................81

         Section 2.02.  Making the A Advances....................................................................82

         Section 2.03.  Conversion to Term Loan, Repayment.......................................................85

         Section 2.04.  Interest Rate on A Advances..............................................................86

         Section 2.05. The B Advances............................................................................86

         Section 2.06.  Fees.....................................................................................94

         Section 2.07.  [intentionally omitted.].................................................................95

         Section 2.08.  Reduction of the Commitments.............................................................95

         Section 2.09.  Additional Interest on Eurodollar Rate A Advances........................................96

         Section 2.10.  Eurodollar Interest Rate Determination...................................................97

         Section 2.11.  Voluntary Conversion of A Advances.......................................................99

         Section 2.12.  Prepayments.............................................................................100

         Section 2.13.  Increases in Costs......................................................................102

         Section 2.14.  Illegality..............................................................................108

         Section 2.15.  Payments and Computations...............................................................109

         Section 2.16.  Sharing of Payments, Etc................................................................111

         Section 2.17.  Alteration of Commitments and Addition of Banks.........................................112

         Section 2.18. Assignments; Sales of Participations and Other Interests in Notes........................114

         Section 2.19.  Extension of Termination Date...........................................................120

         Section 2.20.  Subsidiary Borrowers....................................................................122

ARTICLE 3

         Section 3.01.  Representations and Warranties by the Borrowers.........................................126

         Section 3.02.  Representation by the Banks.............................................................128

ARTICLE 4

         Section 4.01.  Affirmative Covenants of TBC............................................................129

         Section 4.02.  General Negative Covenants of TBC.......................................................131

         Section 4.03.  Financial Statement Terms...............................................................133

         Section 4.04.  Waivers of Covenants....................................................................134

ARTICLE 5

         Section 5.01.  Conditions Precedent to the Initial Borrowing of TBC....................................135

         Section 5.02.  Conditions Precedent to Each A Borrowing of TBC.........................................136

         Section 5.03.  Conditions Precedent to Each B Borrowing of TBC.........................................137

         Section 5.04.  Conditions Precedent to the Initial Borrowing of a Subsidiary Borrower..................139

         Section 5.05.  Conditions Precedent to Each A Borrowing of a Subsidiary Borrower.......................141

         Section 5.06.  Conditions Precedent to Each B Borrowing of a Subsidiary Borrower.......................142

ARTICLE 6

         Section 6.01.  Events of Default.......................................................................145

ARTICLE 7

         Section 7.01.  Authorization and Action................................................................149

         Section 7.02.  Administrative Agent's Reliance, Etc....................................................150

         Section 7.03.  Citibank, N.A. and its Affiliates.......................................................151

         Section 7.04.  Bank Credit Decision....................................................................151

         Section 7.05.  Indemnification.........................................................................152

         Section 7.06.  Successor Administrative Agent..........................................................153

         Section 7.07.  Certain Obligations May be Performed by Affiliates......................................154

ARTICLE 8

         Section 8.01.  Modification, Consents and Waivers......................................................154

         Section 8.02.  Addresses for Notices...................................................................156

         Section 8.03.  Costs, Expenses and Taxes...............................................................156

         Section 8.04.  Binding Effect..........................................................................157

         Section 8.05.  Severability............................................................................157

         Section 8.06.  Governing Law...........................................................................157

         Section 8.07.  Headings................................................................................158

         Section 8.08.  Execution in Counterparts...............................................................159

         Section 8.09.  Right of Set-Off........................................................................159

         Section 8.10.  Agreement in Effect.....................................................................160

         Exhibit A-1       -        Base Rate Advance A Note
         Exhibit A-2       -        Eurodollar Rate A Note
         Exhibit A-3       -        Fixed Rate B Note
         Exhibit A-4       -        Eurodollar Rate B Note
         Exhibit B-1       -        Notice of A Borrowing
         Exhibit B-2       -        Notice of B Borrowing
         Exhibit C         -        Request for Alteration
         Exhibit D         -        Borrower Subsidiary Letter
         Exhibit E         -        Extension Request
         Exhibit F         -        Continuation Note
         Exhibit G         -        Opinion of Chief Legal Officer of Borrower
         Exhibit H         -        Opinion of Counsel for Administrative Agent
         Exhibit I         -        Opinion of in-house counsel to Subsidiary Borrower
         Exhibit J         -        Guaranty of TBC

         Schedule I        -        Commitments

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<PAGE>

                  THIS  BANK  CREDIT  AGREEMENT  (the  "Agreement")  dated as of
September 29, 1999, is by and among: THE BOEING COMPANY, a Delaware  corporation
("TBC" or the  "Company");  the  BORROWERS  (as  defined  below);  the BANKS (as
defined below);  CITIBANK, N.A., in its capacity as administrative agent for the
Banks (in such capacity,  the "Administrative  Agent");  and THE CHASE MANHATTAN
BANK, in its capacity as syndication agent for the Banks (in such capacity,  the
"Syndication Agent").

                                    RECITALS

                  TBC is party to an Amended and  Restated  364-Day  Bank Credit
Agreement dated as of September 30, 1998 (the "Existing Credit  Agreement") with
the banks,  financial institutions and other institutional lenders party thereto
and  Citibank,  N.A.,  as  Administrative  Agent for the  Banks  and such  other
lenders.

                  The parties to this Amendment and Restatement  desire to amend
the Existing Credit Agreement in its entirety to read as set forth below:

                                    ARTICLE 1

                                   Definitions

                  Section 1.01.  Definitions.

                    As used in this  Agreement,  the following  terms shall have
the meanings set out respectively after each:

                  "A  Advance"--An  advance made by a Bank to a Borrower as part
of an A  Borrowing  and  refers to a Base Rate  Advance or a  Eurodollar  Rate A
Advance, each of which shall be a "Type" of A Advance.

                  "A  Borrowing"--A   borrowing  consisting  of  simultaneous  A
Advances of the same Type made by each of the Banks pursuant to Section 2.01.

                  "A Note"--A promissory note of a Borrower payable to the order
of any Bank, in substantially the form of Exhibit A-1 or A-2 hereto,  evidencing
the  indebtedness  of that Borrower to such Bank resulting from the aggregate of
all Base Rate  Advances  and the  aggregate of all  Eurodollar  Rate A Advances,
respectively, made by such Bank to that Borrower.

                  "Administrative Agent"--Citibank, N.A. acting in its capacity
as administrative agent for the Banks, or any successor Administrative Agent
appointed pursuant to Section 7.06.

                  "Administrative Agent's Account"--The account of the
Administrative Agent maintained by the Administrative Agent with Citibank,
N.A., at its office at 2 Pennsway, Corporate Commons, Suite 200, New Castle,
Delaware 19720, Account No. 35852248, Attention:  Jay Moffitt.

                  "Advance"--An A Advance or a B Advance.

                  "Agent"--Individually and collectively, as the context shall
require, the Administrative Agent and the Syndication Agent.

                  "Agreement"--This agreement, as it may be amended or otherwise
modified from time to time, and any written additions or supplements hereto.

                  "Applicable Lending  Office"--With  respect to each Bank, such
Bank's  Domestic  Lending  Office in the case of a Base Rate  Advance,  and such
Bank's  Eurodollar  Lending Office in the case of a Eurodollar Rate Advance and,
in the case of a B Advance, the office of such Bank notified by such Bank to the
Administrative  Agent as its  Applicable  Lending  Office with respect to such B
Advance.

                  "Applicable Margin"--Means

                  with respect to Base Rate Advances, 0% per annum;

                  with respect to Eurodollar Rate Advances which have not been
                  Converted to Term Loans, 0.11% per annum;

                  with  respect  to  Eurodollar  Rate  Advances  which have been
                  Converted  to Term  Loans,  a  fluctuating  per annum  amount,
                  commencing  on the date of the  Conversion  and  ending on the
                  Maturity Date, equal at any time to  then-applicable  rate set
                  forth in the pricing grid below,  depending upon the rating of
                  the long-term senior unsecured debt of TBC then in effect:

<TABLE>
<CAPTION>

<S>                 <C>                                                      <C>
                    -------------------------------------------------------- ----------------------------------
                    Public Debt Rating
                    S&P/Moody's                                                      Applicable Margin
                    -------------------------------------------------------- ----------------------------------
                    -------------------------------------------------------- ----------------------------------
                    Level I
                    A by S&P or A2 by Moody's or above                                                   0.15%
                    -------------------------------------------------------- ----------------------------------
                    -------------------------------------------------------- ----------------------------------
                    Level II
                    less than level I but at least A- by S&P or A3 by                                    0.20%
                    Moody's
                    -------------------------------------------------------- ----------------------------------
                    -------------------------------------------------------- ----------------------------------
                    Level III
                    less than level II but at least BBB+ by S&P or Baa1 by                               0.25%
                    Moody's
                    -------------------------------------------------------- ----------------------------------
                    -------------------------------------------------------- ----------------------------------
                    Level IV
                    less than level III                                                                 0.375%
                    -------------------------------------------------------- ----------------------------------
                    -------------------------------------------------------- ----------------------------------

                    -------------------------------------------------------- ----------------------------------
</TABLE>

                  provided,   however,   that  in  the  event  and   during  the
                  continuance  of an Event of  Default  which  is  described  in
                  Section  6.01(a),  the  Applicable  Margin  shall  immediately
                  increase by 1.0% above the  Applicable  Margin then in effect,
                  and, in the case of a Eurodollar  Rate  Advance,  such Advance
                  shall automatically  convert to a Base Rate Advance at the end
                  of the Interest Period then in effect for such Eurodollar Rate
                  Advance. If the ratings from S&P and Moody's shall fall within
                  different   levels,   then  the  Applicable  Margin  shall  be
                  determined  by the higher of the two ratings  except that,  if
                  the lower of such  rating  is more  than one  level  below the
                  higher  of  such  ratings,  the  Applicable  Margin  shall  be
                  determined based on the level above the lower of such ratings.
                  If at any time no rating is available  from S&P and Moody's or
                  any   other   nationally    recognized    statistical   rating
                  organization  designated by TBC and approved in writing by the
                  Majority Banks, the Applicable Margin for each Interest Period
                  or  each  other  period  commencing  during  the  thirty  days
                  following  such  ratings  becoming  unavailable  shall  be the
                  Applicable Margin in effect  immediately prior to such ratings
                  becoming  unavailable.  Thereafter  the  rating to be used for
                  purposes of this Agreement  until ratings from S&P and Moody's
                  become  available  shall  be as  agreed  between  TBC  and the
                  Administrative  Agent,  and TBC and the  Administrative  Agent
                  shall use good faith  efforts to reach such  agreement  within
                  such thirty day  period,  provided,  however,  that if no such
                  agreement  is  reached  within  such  thirty  day  period  the
                  Applicable Margin thereafter,  until such agreement shall have
                  been  reached,  shall be (A) if any  such  rating  shall  have
                  become  unavailable as a result of S&P or Moody's  ceasing its
                  business as a rating agency,  the Applicable  Margin in effect
                  immediately  prior to such  cessation  or (B)  otherwise,  the
                  Applicable Margin as set forth under Level IV above.

                  "Available Commitment" -- As of any date of determination, (a)
the aggregate  Commitments of the Banks, as such amount may be reduced,  changed
or terminated in accordance with the terms of this Agreement, reduced by (b) the
aggregate Advances outstanding on such date of determination.

                  "B Advance"--An advance by a Bank to a Borrower as part of a B
Borrowing resulting from the auction bidding procedure described in Section 2.05
and refers to a Fixed Rate Advance or a Eurodollar Rate B Advance, each of which
shall be a "Type" of B Advance.

                  "B  Borrowing"--A   borrowing  consisting  of  simultaneous  B
Advances  from each of the Banks  whose  offer to make one or more B Advances as
part of such borrowing has been accepted by a Borrower under the auction bidding
procedure described in Section 2.05.

                  "B Note"--A Promissory note of a Borrower payable to the order
of any Bank, in substantially the form of Exhibit A-3 or A-4 hereto,  evidencing
the  indebtedness  of that Borrower to such Bank resulting from the aggregate of
all Fixed Rate  Advances and the  aggregate of all  Eurodollar  Rate B Advances,
respectively, made by such Bank to such Borrower.

                  "B Reduction"--As defined in Section 2.01.

                  "Bank"--Subject  to the provisions of Section 2.18, any of the
banking  institutions  that is a signatory  hereto or that,  pursuant to Section
2.13, 2.17, 2.18 or 2.19 shall become a "Bank" hereunder.

                  "Base  Rate"--The  rate  of  interest  announced  publicly  by
Citibank,  N.A., in New York,  New York,  from time to time, as Citibank's  base
rate.

                  "Base Rate  Advance"--An A Advance which bears interest at the
Base Rate.

                  "Base Rate A Note"--An A Note evidencing Base Rate Advances.

                  "Borrower"--Individually  and  collectively,  as  the  context
shall require,  TBC and each Subsidiary  Borrower (unless and until it becomes a
"Terminated Subsidiary Borrower" pursuant to Section 2.20).

                  "Borrower Subsidiary Letter" -- With respect to any Subsidiary
Borrower,  a letter in the form of Exhibit D hereto,  signed by such  Subsidiary
Borrower and TBC.

                  "Borrowing"--An A Borrowing or a B Borrowing.

                  "Business  Day"--A  day of the  year on  which  banks  are not
required  or  authorized  to close  in New York  City,  and,  if the  applicable
Business Day relates to any  Eurodollar  Rate  Advances,  on which  dealings are
carried on in the London interbank market.

                  "Commitment"--For   each  Bank,  the  full  amount  set  forth
opposite the name of such Bank in Schedule I attached  hereto,  or, if such Bank
is a  Replacement  Bank or a Bank that has entered into one or more  assignments
pursuant to Section 2.18 or Section 2.19,  the amount set forth for such Bank in
the Register maintained by the Administrative Agent pursuant to Section 2.18(b),
as such amount may be reduced pursuant to Section 2.03,  Section 2.08 or Section
2.17 or increased pursuant to Section 2.17.

                  "Company"--The Boeing Company, a Delaware corporation
(usually referred to herein as "TBC").

                  "Consolidated"--Indicating,  as to any  accounting  concept or
statement, the consolidation of such concept or statement with the same concepts
or  statements  of  all  other  members  of a  class  made  up of  TBC  and  the
Subsidiaries.

                  "Continuing Bank" -- As defined in Section 2.19(a).

                  "Convert,"  "Conversion"  and  "Converted"--Each  refers  to a
conversion of A Advances of one Type into A Advances of another Type pursuant to
Section 2.10,  2.11 or 2.14,  or to the  conversion of A Advances to a Term Loan
pursuant to Section 2.03 (as the context shall require).

                  "Debt  " (i)  Indebtedness  for  borrowed  money  or  for  the
deferred purchase price of property or services;  (ii) the financial obligations
evidenced  by  bonds,  debentures,  notes or other  similar  instruments,  (iii)
financial obligations as lessee under leases which shall have been or should be,
in accordance with generally accepted accounting principles, recorded as capital
leases; and (iv) obligations under direct or indirect  guaranties in respect of,
and obligations  (contingent or otherwise) to purchase or otherwise acquire,  or
otherwise  to assure a creditor  against  loss in respect  of,  indebtedness  or
financial  obligations  of others of the kind referred to in clauses (i) through
(iii) above.

                  "Domestic  Lending  Office"--With  respect  to any  Bank,  the
office of such Bank specified as its "Domestic Lending Office" opposite its name
on Schedule I hereto, or in the assignment or other agreement  pursuant to which
it became a Bank,  or such other  office of such Bank as such Bank may from time
to time specify to the Borrowers and the Administrative Agent.

                  "Effective Date"--As defined in Section 2.17.

                  "Eligible  Assignee"--  (i) a commercial  bank organized under
         the laws of the  United  States,  or any State  thereof,  and  having a
         combined  capital  and  surplus  in  excess of  $3,000,000,000;  (ii) a
         commercial  bank organized under the laws of any other country which is
         a member of the OECD, or a political  subdivision  of any such country,
         and having a combined capital and surplus in excess of  $3,000,000,000,
         provided that such bank is acting through a branch or agency located in
         the country in which it is organized or another country which is also a
         member of the OECD or the Cayman Islands; (iii) the central bank of any
         country which is a member of the OECD;  (iv) any Bank; (v) an affiliate
         of any Bank;  and (vi) any other  Person  approved  in  writing by TBC,
         which approval shall be notified to Citibank, as Administrative Agent.

                  "Eurocurrency  Liabilities"--Has  the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal Reserve System, as
in effect from time to time.

                  "Eurodollar A Note"--An A Note  evidencing  Eurodollar  Rate A
Advances.

                  "Eurodollar  B Note"--A B Note  evidencing  Eurodollar  Rate B
Advances.

                  "Eurodollar  Lending  Office"--With  respect to any Bank,  the
office of such Bank specified as its "Eurodollar  Lending  Office"  opposite its
name on  Schedule I hereto (or, if no such  office is  specified,  its  Domestic
Lending  Office),  or in the assignment or other agreement  pursuant to which it
became a Bank,  or such other  office of such Bank as such Bank may from time to
time specify to the Borrowers and the Administrative Agent.

                  "Eurodollar Rate"--For any Interest Period for each Eurodollar
Rate A  Advance  comprising  part of the same  Borrowing,  and for the  relevant
period  specified in the  applicable  Notice of B Borrowing for each  Eurodollar
Rate B  Advance,  an  interest  rate per  annum  equal to the  offered  rate for
deposits  in U.S.  dollars  for a period  substantially  equal  to the  relevant
Interest  Period (if an A  Advance)  or the  relevant  period  specified  in the
applicable  Notice of B Borrowing  (if a B Advance),  appearing on Telerate Page
3750 (or,  if  unavailable  for any reason by  Telerate,  then by  reference  to
Reuters  Screen) as of 11:00 a.m.  (London  time) two  business  days before the
first  day of such  Interest  Period or the  first  day of the  relevant  period
specified in such Notice of B Borrowing; provided, that if the foregoing rate is
unavailable  from Telerate or the Reuters Screen for any reason,  then such rate
shall be an interest rate per annum equal to the average  (rounded upward to the
nearest  whole  multiple of 1/16 of 1% per annum,  if such average is not such a
multiple) of the rate per annum at which deposits in U.S. dollars are offered by
the principal office of each of the Reference Banks to prime banks in the London
interbank  market at 11:00 a.m. (London time) two Business Days before the first
day of such Interest Period or the first day of the relevant period specified in
such  Notice of B Borrowing  (i) in an amount,  for such  Eurodollar  A Advance,
substantially  equal to such Reference Bank's Eurodollar Rate Advance comprising
part of such A Borrowing and for a period equal to such Interest Period or, (ii)
in an amount,  for such  Eurodollar Rate B Advance,  substantially  equal to the
amount  of the  Eurodollar  Rate  B  Borrowing  which  includes  such B  Advance
multiplied by a fraction equal to such Reference  Bank's ratable  portion of the
Commitments  and for a period  equal to the  relevant  period  specified in such
Notice of B Borrowing.  The  Eurodollar  Rate for any  Interest  Period for each
Eurodollar  Rate A Advance  comprising  part of the same  Borrowing  and for the
relevant period  specified in a Notice of B Borrowing for each Eurodollar Rate B
Advance  shall  be  determined  by the  Administrative  Agent  on the  basis  of
applicable rates furnished to and received by the Administrative  Agent from the
Reference  Banks two Business Days before the first day of such Interest  Period
or period,  as the case may be, subject,  however,  to the provisions of Section
2.10.

                  "Eurodollar Rate  Advance"--An A Advance (a "Eurodollar Rate A
Advance") or a B Advance (a "Eurodollar Rate B Advance") which bears interest at
a rate of interest  quoted as a margin (which shall be the Applicable  Margin in
the case of an A Advance or as offered by a Bank and  accepted  by a Borrower in
the case of a B Advance) over the Eurodollar Rate.

                  "Eurodollar Rate B Borrowing"--As defined in Section 2.05(a)
(i).

                  "Eurodollar  Rate  Reserve  Percentage"--Of  any  Bank for any
Interest  Period for any  Eurodollar  Rate Advance means the reserve  percentage
applicable  during  such  Interest  Period (or if more than one such  percentage
shall be so applicable,  the daily average of such percentages for those days in
such Interest  Period during which any such  percentage  shall be so applicable)
under  regulations  issued  from time to time by the Board of  Governors  of the
Federal  Reserve System (or any successor) for  determining  the maximum reserve
requirement (including, without limitation, any emergency, supplemental or other
marginal  reserve  requirement)  for such Bank with  respect to  liabilities  or
assets consisting of or including  Eurocurrency  Liabilities having a term equal
to such Interest Period.

                  "Event of Default"--Any of the events described in Section
6.01 hereof.

                  "Facility Fee"--As defined in Section 2.06.

                  "Federal Funds Rate"--For any period,  a fluctuating  interest
rate per annum equal for each day during such period to the weighted  average of
the rates on overnight  Federal funds  transactions  with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next  preceding  Business Day) by the
Federal  Reserve Bank of New York,  or, if such rate is not so published for any
day which is a Business Day, the average of the  quotations for such day on such
transactions  received  by the  Administrative  Agent from three  Federal  funds
brokers of recognized standing selected by it.

                  "Fixed Rate Advance"--An  Advance made by a Bank to a Borrower
as part of a Fixed Rate Borrowing.

                  "Fixed Rate Borrowing"--As defined in Section 2.05(a)(i).

                  "Guaranty"--Each  Guaranty  Agreement,  dated as of even  date
herewith,  executed by TBC in favor of the  Administrative  Agent and the Banks,
unconditionally  guaranteeing  the payment of all  obligations  of a  Subsidiary
Borrower hereunder and under the Notes executed or to be executed by them.

                  "Interest   Period"--For   each   Eurodollar  Rate  A  Advance
comprising part of the same Borrowing, the period commencing on the date of such
A Advance or the date of the  Conversion of any A Advance into such a Eurodollar
Rate A Advance  and ending on the last day of the period  selected by a Borrower
pursuant  to the  provisions  below  and,  thereafter,  each  subsequent  period
commencing  on the last day of the  immediately  preceding  Interest  Period and
ending on the last day of the period  selected by the  Borrower  pursuant to the
provisions  below.  The duration of each such Interest Period shall be one, two,
three,  or six months (or nine  months,  with the  consent of all Banks  funding
those  particular  Advances),  as a Borrower  may,  upon notice  received by the
Administrative Agent not later than 11:00 a.m. (New York City time) on the third
Business Day prior to the first day of such Interest  Period,  select,  provided
however, that:

                  (i) no  Interest  Period  shall end on a date  later  than the
         Termination  Date (or in the case of an A Advance which is Converted to
         a term loan pursuant to Section 2.03, the Maturity Date);

                  (ii)     Interest Periods commencing on the same date for
         A Advances comprising part of the same A Borrowing shall be of the
         same duration; and

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

                  "Majority  Banks"--Banks  holding greater than 50% of the then
aggregate  unpaid  principal amount of the A Notes held by Banks, or, if no such
principal  amount is then  outstanding,  Banks  having  greater  than 50% of the
Commitments (provided that, for purposes hereof, none of the Borrowers, and none
of their affiliates,  if a Bank, shall be included in (i) the Banks holding such
amount of the A  Advances  or having  such  amount  of the  Commitments  or (ii)
determining the aggregate unpaid principal amount of the A Advances or the total
Commitments).

                  "Maturity Date" -- The Termination  Date, or, if the Term Loan
Conversion Option described in Section 2.03 has been exercised, the date that is
the three-year anniversary of the Termination Date.

                  "Moody's"--Moody's Investor Services, Inc.

                  "Non-Extending Bank" -- As defined in Section 2.19(a).

                  "Note"--An A Note or a B Note.

                  "Notice of A Borrowing"--As defined in Section 2.02(a).

                  "Notice of B Borrowing"--As defined in Section 2.05(a)(i).

                  "Notice of Borrowing"--A Notice of A Borrowing or a Notice of
B Borrowing.

                  "Person" -- An individual, partnership, corporation (including
a business  trust),  limited  liability  company,  joint stock  company,  trust,
unincorporated  association,  joint venture or other entity,  or a government or
any political subdivision or agency thereof.

                  "Property, Plant and Equipment"--Any item of real property, or
any interest therein, buildings, improvements and machinery.

                  "Reference  Banks"--The Chase Manhattan Bank, Citibank,  N.A.,
BankBoston, N.A., Bank of New York, and National Westminster Bank plc.

                  "Register"--As defined in Section 2.18.

                  "Replacement Banks" -- As defined in Section 2.19(c).

                  "Required Assignment"--As defined in Section 2.18.

                  "Request for Alteration"--A document substantially in the form
of Exhibit C hereto, duly executed by TBC, pursuant to the provisions of Section
2.17.

                  "S&P"--Standard & Poor's Corporation.

                  "Subsidiary"--Any  corporation  in which  more than 50% of the
Voting Stock is owned by TBC, by TBC and any one or more other Subsidiaries,  or
by any one or more other Subsidiaries.

                  "Subsidiary  Borrower"--Individually and collectively,  as the
context  shall  require,  each  Subsidiary  in which 100% of the Voting Stock is
owned by TBC,  by TBC and any one or more other  Subsidiaries,  or by any one or
more other  Subsidiaries,  that is or shall  become a  "Borrower"  hereunder  in
accordance  with  Section  2.20;  in each  case,  unless  and until it becomes a
"Terminated Subsidiary Borrower."

                  "Syndication  Agent"--The  Chase Manhattan Bank, acting in its
capacity as syndication agent for the Banks.

                  "TBC"--The Boeing Company, a Delaware corporation.

                  "Term Loan  Conversion  Option"--The  option  described  under
Section  2.03 for a Borrower  to  Convert,  as of the  Termination  Date,  all A
Advances then outstanding into a term loan.

                  "Terminated     Subsidiary     Borrower"--Individually     and
collectively,  as the context  shall  required,  a  Subsidiary  Borrower who has
ceased to be a "Borrower"  for purposes of this  Agreement  in  accordance  with
Section 2.20.

                  "Termination  Date"--The earlier to occur of (i) September 27,
2000,  as such date may be extended  from time to time pursuant to Section 2.19,
and (ii) the date of termination in whole of the Commitments pursuant to Section
2.08 or Section 6.01.

                  "Voting  Stock"--All the issued and outstanding  capital stock
of any corporation  having general voting power under ordinary  circumstances to
elect a majority of the Board of Directors of such corporation  (irrespective of
whether or not any capital  stock of any other  class or classes  shall or might
have voting power upon the occurrence of any contingency).

                  Section 1.02. Use of Defined  Terms.  Any defined term used in
the plural  preceded by the definite  article  shall be taken to  encompass  all
members of the relevant class. Any defined term used in the singular preceded by
"any"  shall be taken to  indicate  any number of the  members  of the  relevant
class.

                  Section 1.03.  Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistently applied.

                                    ARTICLE 2

                        Amounts and Terms of the Advances

                  Section 2.01. The A Advances.  Each Bank severally  agrees, on
the terms and  conditions  hereinafter  set  forth,  to make A  Advances  to the
Borrowers  from time to time on any Business Day during the period from the date
hereof until the Termination  Date in an aggregate  principal amount at any time
outstanding  not to exceed such Bank's  Commitment,  provided that the aggregate
amount of the Commitments of the Banks shall be deemed used from time to time to
the extent of the aggregate  amount of the B Advances then  outstanding and such
deemed use of the aggregate  amount of the  Commitments  shall be applied to the
Banks ratably according to their respective  Commitments (such deemed use of the
aggregate  amount of the Commitments  being a "B  Reduction").  Each A Borrowing
shall  be in an  aggregate  amount  not less  than  $10,000,000  or an  integral
multiple of $1,000,000 in excess thereof (or, if less, an aggregate amount equal
to the  difference  between  the  aggregate  amount of a  proposed  B  Borrowing
requested by a Borrower  and the  aggregate  amount of B Advances  offered to be
made by the Banks and  accepted by the  Borrower in respect of such B Borrowing,
if notice of such A Borrowing is given by the Borrower  within two Business Days
of the date of such B  Borrowing)  and shall  consist of A Advances  of the same
Type made on the same day by the Banks  ratably  according  to their  respective
Commitments. Within the limits of each Bank's Commitment, the Borrowers may from
time to time borrow,  prepay  pursuant to Section 2.12,  and reborrow under this
Section 2.01.

                  Section  2.02.  Making the A  Advances.  (a) Each A  Borrowing
shall be made on notice,  given by a Borrower  to the  Administrative  Agent not
later  than  11:00  a.m.  (New  York  City  time) on the day of the  proposed  A
Borrowing  in the case of a Base Rate  Borrowing  and on the third  Business Day
prior to the date of the proposed A Borrowing  in the case of a Eurodollar  Rate
Borrowing.  The  Administrative  Agent  thereupon shall give to each Bank prompt
notice thereof by telecopier, telex or cable. Each such notice of an A Borrowing
(a "Notice of A Borrowing")  shall be by telecopier,  telex or cable,  confirmed
immediately  in  writing,  in  substantially  the form of  Exhibit  B-l  hereto,
specifying  therein the requested  (i) date of such A Borrowing,  (ii) Type of A
Advances  comprising  such  A  Borrowing,  (iii)  aggregate  amount  of  such  A
Borrowing,  and (iv) in the case of an A Borrowing  comprised of Eurodollar Rate
Advances,  initial  Interest  Period for each such A Advance.  Every Notice of A
Borrowing given by a Subsidiary  Borrower must be countersigned by an authorized
representative  of TBC,  in order to  evidence  the  consent of TBC, in its sole
discretion, to that proposed A Borrowing. Each Bank shall, before 1:00 p.m. (New
York City time) on the date of such A Borrowing,  make available for the account
of  its  Applicable   Lending  Office  to  the   Administrative   Agent  at  the
Administrative  Agent's Account,  in same day funds, such Bank's ratable portion
of such A Borrowing.  After the Administrative Agent's receipt of such funds and
upon  fulfillment  of the  applicable  conditions  set forth in  Article  5, the
Administrative  Agent  will make such funds  available  to the  Borrower  at the
Administrative Agent's aforesaid address.

                  (b)  Each  Notice  of A  Borrowing  shall be  irrevocable  and
binding.  In the case of any A Borrowing which the related Notice of A Borrowing
specifies  is  to  be  comprised  of  Eurodollar  Rate  Advances,  the  Borrower
requesting  such A Borrowing shall indemnify each Bank against any loss, cost or
expense  incurred by such Bank on account of any failure to fulfill on or before
the date  specified  for such A  Borrowing  in such  Notice of A  Borrowing  the
applicable conditions set forth in Article 5, including, without limitation, any
loss (including loss of anticipated profits), cost or expense incurred by reason
of the  liquidation or  reemployment of deposits or other funds acquired by such
Bank to fund the A Advance  to be made by such Bank as part of such A  Borrowing
when such A Advance, as a result of such failure, is not made on such date.

                  (c) Unless the Administrative Agent shall have received notice
from a Bank  prior  to  1:00  p.m.  (New  York  City  time)  on the day of any A
Borrowing  that such Bank will not make  available to the  Administrative  Agent
such Bank's ratable portion of such A Borrowing,  the  Administrative  Agent may
assume  that such Bank has made such  portion  available  to the  Administrative
Agent on the date of such A Borrowing in accordance  with subsection (a) of this
Section 2.02 and the Administrative Agent may, in reliance upon such assumption,
make available to the Borrower on such date a  corresponding  amount.  If and to
the extent that such Bank shall not have so made such ratable portion  available
to the  Administrative  Agent,  such Bank and such Borrower  severally  agree to
repay to the Administrative  Agent forthwith on demand such corresponding amount
together with interest  thereon,  for each day from the date such amount is made
available  to such  Borrower  until  the  date  such  amount  is  repaid  to the
Administrative  Agent,  at (i) in the  case of a  Borrower,  the  interest  rate
applicable at the time to A Advances comprising such A Borrowing and (ii) in the
case of such Bank,  the  Federal  Funds  Rate.  If such Bank shall  repay to the
Administrative  Agent such  corresponding  amount,  such amount so repaid  shall
constitute  such  Bank's A Advance as part of such A Borrowing  for  purposes of
this Agreement.

                  (d) The  failure  of any Bank to make the A Advance to be made
by it as part  of any A  Borrowing  shall  not  relieve  any  other  Bank of its
obligation,  if any,  hereunder  to make  its A  Advance  on the  date of such A
Borrowing, but no Bank shall be responsible for the failure of any other Bank to
make the A Advance to be made by such other Bank on the date of any A Borrowing.

                  Section  2.03.  Conversion to Term Loan,  Repayment.  TBC may,
upon notice  given to the  Administrative  Agent not later than 11:00 a.m.  (New
York City time) on the Termination Date,  Convert the aggregate unpaid principal
amount of the A  Advances  outstanding  as of the  Termination  Date into a term
loan. If this Conversion  option is exercised,  then, on the  Termination  Date,
immediately  prior to the time when the aggregate unpaid principal amount of the
A Advances would otherwise be due, the aggregate  unpaid principal amount of the
A Advances then outstanding shall  automatically  convert into a term loan which
each Borrower shall repay to the Administrative Agent for the ratable account of
the Banks on the Maturity  Date.  The amounts so converted  shall be treated for
all purposes of this Agreement as A Advances  except that after the  Termination
Date:

                 (a)      the Borrowers may not make any additional borrowings;

                 (b)      any amounts paid or prepaid may not be reborrowed;

                 (c)      the amount of each Bank's  Commitment shall be equal
      at all times to the principal  amount of the A Borrowing  payable to such
      Bank from time to time;

                 (d)      the provisions of Section 2.17 shall not be effective;

                 (e)      no Bank shall have the right to assign its rights in
      any A Advances outstanding; and

                 (f)      no Facility Fees shall accrue or be payable after the
      Termination Date.

                  Section 2.04. Interest Rate on A Advances. The Borrowers shall
pay interest on the unpaid  principal amount of each A Advance made by each Bank
from the date of such A Advance  until such  principal  amount  shall be paid in
full, at the following  rates per annum:  (i) during each period in which such A
Advance is a Base Rate  Advance,  at a rate per annum  equal at all times to the
Base  Rate in effect  from time to time,  plus the  Applicable  Margin,  payable
quarterly in arrears on the first day of each January,  April,  July and October
and on the Termination  Date, or, if the Conversion  option described in Section
2.03 is exercised,  the Maturity Date, and (ii) during each period in which such
A Advance is a Eurodollar  Rate Advance,  at a rate per annum equal at all times
during each relevant  Interest  Period for such A Advance to the Eurodollar Rate
for such Interest Period plus the Applicable Margin,  payable on the last day of
each such Interest  Period,  and on the date such A Advance is Converted or paid
in full.

                  Section 2.05. The B Advances.  (a) Each Bank severally  agrees
that the  Borrowers  may make B Borrowings  under this Section 2.05 from time to
time on any  Business  Day  during  the period  from the date  hereof  until the
Termination  Date in the manner set forth below,  provided  that,  following the
making  of  each  B  Borrowing,  the  aggregate  amount  of  the  Advances  then
outstanding  shall not exceed the  aggregate  amount of the  Commitments  of the
Banks.  As  provided  in  Section  2.01  above,  the  aggregate  amount  of  the
Commitments of the Banks shall be deemed used from time to time to the extent of
the aggregate  amount of the B Advances then  outstanding and such deemed use of
the aggregate  amount of the  Commitments  shall be applied to the Banks ratably
according to their respective Commitments;  provided, however, that any Bank's B
Advances shall not otherwise reduce that Bank's  obligation to lend its pro rata
share of the remaining Available Commitment.

                 (i) Any Borrower  may request a B Borrowing  under this Section
         2.05 by delivering to the Administrative Agent, by telecopier, telex or
         cable,  confirmed  immediately in writing, a notice of a B Borrowing (a
         "Notice of B  Borrowing"),  in  substantially  the form of Exhibit  B-2
         hereto,  specifying  the date and  aggregate  amount of the  proposed B
         Borrowing, the maturity date for repayment of each B Advance to be made
         as part of such B Borrowing  (which maturity date may not be later than
         5 Business Days prior to the  Termination  Date, but may otherwise be 7
         days or more  from the date of such B  Advance  if the  Borrower  shall
         specify in the Notice of B  Borrowing  that the rates of interest to be
         offered  by the Banks  shall be fixed  rates  per annum (a "Fixed  Rate
         Borrowing"),  and either 1, 2, 3, 6 or 9 months from the date of such B
         Borrowing  if the Borrower  shall  specify in the Notice of B Borrowing
         that such B Borrowing  is to be a Borrowing  consisting  of  Eurodollar
         Rate B  Advances  (a  "Eurodollar  Rate B  Borrowing")),  the  interest
         payment  date or dates  relating  thereto,  and any  other  terms to be
         applicable  to such B  Borrowing,  not later than 11:00 a.m.  (New York
         City  time)  (A) at least  one  Business  Day  prior to the date of the
         proposed B Borrowing if the Borrower  shall  specify in the Notice of B
         Borrowing  that such B Borrowing is to be a Fixed Rate  Borrowing,  and
         (B) at least four  Business  Days  prior to the date of the  proposed B
         Borrowing,  if the Borrower  shall  instead  specify in the Notice of B
         Borrowing that such B Borrowing is to be a Eurodollar Rate B Borrowing.
         Every  Notice of B Borrowing  given by a  Subsidiary  Borrower  must be
         countersigned  by an  authorized  representative  of TBC,  in  order to
         evidence the consent of TBC, in its sole discretion, to that proposed B
         Borrowing.  The Administrative Agent shall in turn promptly notify each
         Bank of each request for a B Borrowing  received by it from the Company
         by sending such Bank a copy of the related Notice of B Borrowing.

                 (ii) Each Bank may, if, in its sole discretion, it elects to do
         so,  irrevocably  offer to make one or more B Advances to a Borrower as
         part of such  proposed  B  Borrowing  at a rate or  rates  of  interest
         specified by such Bank in its sole discretion (such rate of interest to
         be a fixed rate if the Borrower  requested  Fixed Rate  Advances,  or a
         margin over the Eurodollar  Rate if the Borrower  requested  Eurodollar
         Rate B Advances),  by notifying the  Administrative  Agent (which shall
         give prompt notice  thereof to the Company and such  Borrower),  before
         10:00  a.m.  (New York City  time) (A) on the date of such  proposed  B
         Borrowing, in the case of a Notice of B Borrowing delivered pursuant to
         clause (A) of paragraph  (i) above and (B) three  Business  Days before
         the date of such  proposed  B  Borrowing,  in the case of a Notice of B
         Borrowing  delivered  pursuant to clause (B) of paragraph (i) above, of
         the minimum amount and maximum amount of each B Advance which such Bank
         would be willing to make as part of such  proposed B  Borrowing  (which
         amounts  may,  subject  to the  proviso to the first  sentence  of this
         Section 2.05(a),  exceed such Bank's Commitment),  the rate or rates of
         interest therefor (specified as stated in this paragraph (ii)) and such
         Bank's  Applicable  Lending  Office  with  respect  to such B  Advance;
         provided  that if the  Administrative  Agent in its  capacity as a Bank
         shall, in its sole  discretion,  elect to make any such offer, it shall
         notify such  Borrower  and the  Company of such offer  before 9:30 a.m.
         (New York City time) on the date on which notice of such election is to
         be given to the  Administrative  Agent by the other Banks. If, by 10:00
         a.m.  (New  York  City  time) on the date on which  notice  of a Bank's
         election   under  this  Section   2.05(a)(ii)   is  to  be  made,   the
         Administrative  Agent fails to receive,  at its address  referred to in
         Section  8.02,  the notice  from a Bank  provided  for in this  Section
         2.05(a)(ii),  the  Administrative  Agent may conclusively  presume that
         such  Bank has  elected  not to offer  to make any B  Advances  to such
         Borrower with respect to the related Notice of B Borrowing.

                 (iii) Such Borrower  shall, in turn, (A) before 11:00 a.m. (New
         York City time) on the date of such  proposed B Borrowing,  in the case
         of a  Notice  of B  Borrowing  delivered  pursuant  to  clause  (A)  of
         paragraph  (i) above,  and (B)  before  12:00 noon (New York City time)
         three  Business Days before the date of such  proposed B Borrowing,  in
         the case of a Notice of B Borrowing delivered pursuant to clause (B) of
         paragraph (i) above, either:

                        (x) cancel such B Borrowing by giving the Administrative
                        Agent notice to that effect, or

                        (y) accept one or more of the offers made by any Bank or
                        Banks  pursuant  to  Section  2.05(a)(ii),  in its  sole
                        discretion, by giving notice to the Administrative Agent
                        of the amount of each B Advance  (which  amount shall be
                        equal to or greater than the minimum  amount,  and equal
                        to or less  than the  maximum  amount,  notified  to the
                        Borrower by the  Administrative  Agent on behalf of such
                        Bank for such B Advance pursuant to Section  2.05(a)(ii)
                        above)  to be  made  by  each  Bank  as  part  of such B
                        Borrowing, and reject any remaining offers made by Banks
                        pursuant  to  Section  2.05(a)(ii)  above by giving  the
                        Administrative  Agent  notice to that  effect;  provided
                        that  offers  will be  accepted,  if at all, in order of
                        lowest to highest  interest  rates,  and, if two or more
                        Banks  bid  at  same  rate,  the  B  Borrowing  will  be
                        allocated  among such Banks in  proportion to the amount
                        bid by each such Bank.

                 (iv) If the  Borrower  notifies the  Administrative  Agent that
         such B Borrowing is canceled pursuant to Section 2.05(a)(iii)(x) above,
         the Administrative  Agent shall give prompt notice thereof to the Banks
         and such B Borrowing shall not be made.

                 (v) If the  Borrower  accepts one or more of the offers made by
         any  Bank or Banks  pursuant  to  Section  2.05(a)(iii)(y)  above,  the
         Administrative  Agent shall in turn  promptly (A) notify each Bank that
         has made an offer as described  in Section  2.05(a)(ii)  above,  of the
         date and  aggregate  amount of such B Borrowing  and whether or not any
         offer or offers made by such Bank pursuant to Section 2.05(a)(ii) above
         have been  accepted  by the  Borrower , (B) notify each Bank that is to
         make a B Advance as part of such B  Borrowing,  of the amount of each B
         Advance  to be made by such Bank as part of such B  Borrowing,  and (C)
         upon  satisfaction  of the  conditions  set  forth in 5.03 or 5.06,  as
         applicable,  notify  each Bank  that is to make a B Advance  as part of
         such B Borrowing that the applicable  conditions set forth in Article 5
         appear to have been satisfied. Each Bank that is to make a B Advance as
         part of such B Borrowing  shall,  before 1:00 p.m. (New York City time)
         on the date of such B Borrowing  specified in the notice  received from
         the  Administrative  Agent  pursuant  to  clause  (A) of the  preceding
         sentence  and when  such  Bank  shall  have  received  notice  from the
         Administrative  Agent pursuant to clause (C) of the preceding sentence,
         make available for the account of its Applicable  Lending Office to the
         Administrative Agent at the Administrative  Agent's Account such Bank's
         portion of such B Borrowing, in same day funds. Upon fulfillment of the
         applicable  conditions  set forth in Article 5 and after receipt by the
         Administrative  Agent of such funds, the Administrative Agent will make
         such  funds  available  to the  Company at the  Administrative  Agent's
         Account.  Promptly after each B Borrowing the Administrative Agent will
         notify each Bank of the amount of the B  Borrowing,  the  consequent  B
         Reduction and the dates upon which such B Reduction  commenced and will
         terminate.

                  (b) Each  Notice of B  Borrowing  shall  request an  aggregate
amount of B  Advances  not less than  $10,000,000  or an  integral  multiple  of
$1,000,000  in excess  thereof  provided  that the  Borrowers  may accept offers
aggregating less than $10,000,000 and offers which are not an integral  multiple
of  $1,000,000  and  provided  further  that  following  the  making  of  each B
Borrowing, the Borrowers shall be in compliance with the limitation set forth in
the proviso to the first sentence of subsection (a) above. Within the limits and
on the conditions set forth in this Section 2.05, the Borrowers may from time to
time  borrow  under  this  Section  2.05,  repay or prepay  pursuant  to Section
2.05(c), and reborrow under this Section 2.05, provided that a B Borrowing shall
not be made within three Business Days of the date of any other B Borrowing.

                  (c) On the maturity date of each B Advance (such maturity date
being that  specified  by the  Borrower  for  repayment of such B Advance in the
related  Notice of B Borrowing  delivered  pursuant to Section  2.05(a)(i))  the
Borrower  shall  repay to the  Administrative  Agent for the account of the Bank
which  has made  such B  Advance  the then  unpaid  principal  amount  of such B
Advance. The Borrowers shall have no right to prepay any principal amount of any
B Advance.

                  (d) The Borrowers  shall pay interest on the unpaid  principal
amount  of each B  Advance,  from  the  date of such B  Advance  to the date the
principal  amount of such B Advance  is  repaid  in full,  at the fixed  rate of
interest for such B Advance (in the case of a Fixed Rate B Advance) specified by
the Bank  making  such B Advance in its notice with  respect  thereto  delivered
pursuant to Section  2.05(a)(ii)  above or (in the case of a  Eurodollar  Rate B
Advance)  the margin  specified  by the Bank making such B Advance in its notice
with respect thereto  delivered  pursuant to Section  2.05(a)(ii) above plus the
Eurodollar Rate determined with respect to such B Borrowing  pursuant to Section
2.10,  payable on the interest  payment date or dates specified by the Borrowers
for such B Advance in the related  Notice of B Borrowing  delivered  pursuant to
Section 2.05(a)(i) above.

                  (e) The  indebtedness  of each Borrower  resulting  from all B
Advances  made by a Bank  shall be  evidenced  by a  single B Note  made by such
Borrower and payable to the order of such Bank covering all Fixed Rate Advances,
and a single B Note made by such  Borrower and payable to the order of such Bank
covering all Eurodollar B Advances, made by such Bank to such Borrower.

                  (f) Any Bank may,  without  the prior  written  consent of the
Borrowers , sell or assign all or any part of such  Bank's  rights in any or all
of the B  Advances  made by such Bank or the B Notes in  connection  with such B
Advances  as a  participation,  provided,  however,  that (i) any  such  sale or
assignment shall not require the Borrowers to file a registration statement with
the Securities  and Exchange  Commission or apply to qualify the Notes under the
blue sky laws of any state and the  selling or  assigning  Bank shall  otherwise
comply  with  all  federal  and  state   securities   laws  applicable  to  such
transaction;  (ii) no purchaser or assignee in such a transaction  shall thereby
become  a "Bank"  for any  purpose  under  this  Agreement,  (iii)  such  Bank's
obligations under this Agreement (including,  without limitation, its Commitment
to the Borrowers hereunder) shall remain unchanged,  (iv) such Bank shall remain
solely  responsible  to the other  parties  hereto for the  performance  of such
obligations, and (v) the Borrowers, the Administrative Agent and the other Banks
shall  continue to deal solely and directly  with such Bank in  connection  with
such Bank's rights and obligations under this Agreement.

                  Section 2.06.  Fees.  TBC agrees to pay to the  Administrative
Agent for the  account  of each Bank a  facility  fee  ("Facility  Fee") on such
Bank's  Commitment,  without regard to usage.  Such fee shall be payable for the
periods  from the date  hereof  in the case of each  Bank  named in  Schedule  I
attached  hereto,  and from the  effective  date on which any other Bank becomes
party  hereto,  until  the  Termination  Date at the  rate of  .04%  per  annum;
provided,  however,  that if the Term Loan Conversion Option has been exercised,
no Facility  Fees shall  accrue or be payable  during the period  following  the
effective date of that Conversion.  Facility Fees shall be payable in arrears on
each January 1, April 1, July 1 and October 1 during the term of this  Agreement
and on either the Termination Date (in the event the Term Loan Conversion Option
has not been  exercised)  or the date that the  Conversion  takes effect (in the
event the Term Loan  Conversion  Option has been  exercised).  The  Facility Fee
shall be  calculated  based on a 360-day  year.  The amount of the  Facility Fee
payable on October 1, 1999 and on either the  Termination  Date or the date that
the  Conversion  takes effect,  as  applicable,  shall be prorated  based on the
actual  number of days  elapsed  either  since the date  hereof  (in the case of
October 1, 1999  payment) or since the date on which the last payment in respect
of the  Facility  Fee was made (in the case of the  payment  made on either  the
Termination Date or the date that the Conversion takes effect, as applicable).

                  Section 2.07.  [intentionally omitted.]

                  Section  2.08.  Reduction  of the  Commitments.  (a)  Optional
Reductions.  TBC shall have the right,  upon at least 3 Business Days' notice to
the  Administrative  Agent,  to terminate in whole or reduce ratably in part the
unused  portions of the  Commitments  of the Banks,  provided  that each partial
reduction shall be in a minimum amount of $10,000,000 or an integral multiple of
$1,000,000 in excess thereof,  and provided further that the aggregate amount of
the  Commitments  of the Banks  shall not be reduced to an amount  which is less
than the aggregate principal amount of the B Advances then outstanding.

                  (b)  Mandatory  Reduction.  At the  close of  business  on the
Termination Date, the aggregate  Commitments of the Banks shall be automatically
and permanently  reduced,  on a pro rata basis, by an amount equal to the amount
by which the aggregate  Commitments  immediately  prior to giving effect to such
reduction  exceeds the aggregate  unpaid principal amount of the A Advances then
outstanding.

                  Section  2.09.   Additional  Interest  on  Eurodollar  Rate  A
Advances.  The  Borrowers  shall pay to each Bank, so long as such Bank shall be
required  under  regulations  of the Board of Governors  of the Federal  Reserve
System to maintain  reserves with respect to liabilities or assets consisting of
or  including  Eurocurrency  Liabilities,  additional  interest  on  the  unpaid
principal  amount of each  Eurodollar Rate A Advance of such Bank, from the date
of such A Advance  until such  principal  amount is paid in full, at an interest
rate per annum equal at all times to the remainder  obtained by subtracting  (i)
the  Eurodollar  Rate for the  Interest  Period for such A Advance from (ii) the
rate obtained by dividing  such  Eurodollar  Rate by a percentage  equal to 100%
minus the  Eurodollar  Rate Reserve  Percentage  of such Bank for such  Interest
Period,  payable  on each date on which  interest  is payable on such A Advance.
Such  additional  interest  shall be determined by such Bank and notified to the
Borrowers through the Administrative Agent.

                  Section 2.10. Eurodollar Interest Rate Determination.  (a) The
Administrative  Agent shall  determine each Eurodollar Rate by using the methods
described in the definition of the term "Eurodollar Rate," and shall give prompt
notice to the Borrowers and the Banks of each such Eurodollar Rate.

                  (b) In the event the rate  cannot be  determined  by the first
method  described in the  definition of  "Eurodollar  Rate," each Reference Bank
agrees to furnish to the Administrative Agent timely information for the purpose
of determining  each such  Eurodollar  Rate in accordance with the second method
described  therein.  If any one or more of the Reference Banks shall not furnish
such  timely  information  to  the  Administrative  Agent  for  the  purpose  of
determining  any such interest rate, the  Administrative  Agent shall  determine
such interest rate on the basis of timely information furnished by the remaining
Reference Banks. In the event the rate cannot be determined by the either of the
methods described in the definition of "Eurodollar Rate," then:

                 (i)  the Administrative Agent shall forthwith notify the
         Borrowers and the Banks that the interest rate cannot be determined
         for such Eurodollar Rate Advances,

                 (ii) each such Advance, if an A Advance, will automatically, on
         the last day of the then existing  Interest  Period  therefor,  Convert
         into a Base Rate Advance (or if the Borrower was  attempting to Convert
         a Base Rate Advance into a Eurodollar Rate A Advance, such Advance will
         continue as a Base Rate Advance), and

                 (iii) the  obligation  of the Banks to make  Eurodollar  Rate B
         Advances,  or to make, or to Convert A Advances into, Eurodollar Rate A
         Advances shall be suspended until the Administrative Agent shall notify
         the  Borrowers  and the  Banks  that  the  circumstances  causing  such
         suspension no longer exist.

                  (c) If, with respect to any  Eurodollar  Rate A Advances,  the
Majority Banks notify the Administrative  Agent that the Eurodollar Rate for any
Interest Period for such A Advances will not adequately reflect the cost to such
Majority Banks of making,  funding or maintaining  their  respective  Eurodollar
Rate A  Advances  for such  Interest  Period,  the  Administrative  Agent  shall
forthwith so notify the Borrowers and the Banks, whereupon

                 (i) each Eurodollar Rate A Advance will  automatically,  on the
         last day of the then existing Interest Period therefor,  Convert into a
         Base Rate Advance, and

                 (ii) the  obligation  of the  Banks to make,  or to  Convert  A
         Advances into,  Eurodollar Rate A Advances shall be suspended until the
         Administrative Agent shall notify the Borrowers and such Banks that the
         circumstances causing such suspension no longer exist.

                  (d) If a Borrower  shall fail to select  the  duration  of any
Interest  Period for any  Eurodollar  Rate A  Advances  in  accordance  with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative  Agent will  forthwith  so notify the  Borrower and the Banks and
such A  Advances  will  automatically,  on the  last  day of the  then  existing
Interest Period therefor, Convert into Base Rate Advances.

                  Section 2.11. Voluntary Conversion of A Advances. Any Borrower
may on any Business Day, upon notice given to the Administrative Agent not later
than 11:00 a.m. (New York City time) on the third Business Day prior to the date
of the proposed  Conversion  and subject to the  provisions of Sections 2.10 and
2.14,  Convert all A Advances of one Type  comprising  the same A Borrowing into
Advances  of  another  Type;  provided,  however,  that  any  Conversion  of any
Eurodollar  Rate A Advances into Base Rate  Advances  shall be made on, and only
on, the last day of an Interest Period for such Eurodollar Rate A Advances. Each
such notice of a Conversion  shall,  within the  restrictions  specified  above,
specify (i) the date of such  Conversion,  (ii) the A Advances to be  Converted,
and (iii) if such Conversion is into Eurodollar Rate A Advances, the duration of
the Interest Period for each such A Advance.

                  Section 2.12.  Prepayments.  Any Borrower shall have the right
at any time and from time to time,  upon prior written  notice from the Borrower
to the  Administrative  Agent, to prepay its outstanding  principal  obligations
evidenced by its A Notes in whole or ratably (except as provided in Section 2.14
or 2.17) in part and may be obligated to make certain prepayments of obligations
evidenced by one or more A Notes subject to and in accordance with the following
(provided that every notice of prepayment given by a Subsidiary Borrower must be
countersigned by an authorized  representative  of TBC, in order to evidence the
consent of TBC, in its sole discretion, to that prepayment):

                  (a) With  respect  to Base Rate  Borrowings,  such  prepayment
shall be without  premium or penalty,  upon notice  given to the  Administrative
Agent,  and shall be made not later than 11:00 a.m.  (New York City time) on the
date of such prepayment.  The Borrower shall designate in such notice the amount
and date of such prepayment.  Accrued interest on the amount so prepaid shall be
payable on the first  Business Day of the calendar  quarter next  following  the
prepayment.  The minimum amount of Base Rate Borrowings  which may be prepaid on
any occasion  shall be  $10,000,000  or an integral  multiple of  $1,000,000  in
excess  thereof  or, if less,  the  total  amount  of Base  Rate  Advances  then
outstanding for that Borrower.

                  (b)  With  respect  to  Eurodollar  Rate  A  Borrowings,  such
prepayment shall be made on at least 3 Business Days' prior written notice.  The
Borrower shall  designate in such notice the amount and date of such  prepayment
and  the  Eurodollar  Rate A  Borrowings  against  which  each  portion  of each
prepayment shall be applied,  which portion shall be ratable as among the Banks.
The minimum amount of Eurodollar  Rate A Borrowings  which may be prepaid on any
occasion shall be  $10,000,000  or an integral  multiple of $1,000,000 in excess
thereof  or,  if less,  the total  amount of  Eurodollar  Rate A  Advances  then
outstanding  for  that  Borrower.  The  Borrower  shall,  on  the  date  of  the
prepayment,  pay to the  Administrative  Agent  for the  account  of  each  Bank
interest  accrued to such date of  prepayment on the  principal  amount  prepaid
plus,  in the case only of a prepayment on any date which is not the last day of
an applicable  Eurodollar  Interest Period, any amounts which may be required to
compensate  such  Bank  for  any  losses  or  out-of-pocket  costs  or  expenses
(including any loss,  cost or expense  incurred by reason of the  liquidation or
reemployment  of deposits or other  funds,  but  excluding  loss of  anticipated
profits)  incurred by such Bank as a result of such  prepayment,  provided  that
such Bank shall exercise  reasonable efforts to minimize any such losses,  costs
and expenses.

                  (c) If due to any  prepayment  pursuant to Section  2.14 or to
the  acceleration  of any of the A Notes  pursuant to Section 6.01 or otherwise,
any Bank  receives  payment of its portion  of, or is subject to any  Conversion
from,  any  Eurodollar  Rate A Advance  on any day other than the last day of an
Interest  Period with respect to such A Advance,  the Borrowers  will pay to the
Administrative  Agent  for the  account  of such Bank any  amounts  which may be
payable  to such  Bank by the  Borrower  by  reason  of  payment  on such day as
provided in Section 2.12(b).

                  Section  2.13.  Increases in Costs.  (a) If, due to either (1)
the  introduction  of, or any change (other than, in the case of Eurodollar Rate
Borrowings,  a change by way of imposition  or increase of reserve  requirements
referred to in Section 2.09) in, or new interpretation of, any law or regulation
effective at any time and from time to time on or after  December 8, 1997 or (2)
the  compliance  with  any  request  from  or  by  any  central  bank  or  other
governmental  authority (whether or not having the force of law), there shall be
any  increase  in the costs  incurred by any Bank in agreeing to make or making,
funding  or  maintaining  any  Eurodollar  Rate A  Advance  then or at any  time
thereafter outstanding,  then the Borrowers shall from time to time, upon demand
of such Bank (with a copy of such demand to the  Administrative  Agent),  pay to
the  Administrative  Agent for the account of such Bank such amounts as shall be
required to compensate  such Bank for such  increased  cost,  provided that such
Bank shall exercise  reasonable efforts (consistent with its internal policy and
legal and  regulatory  restrictions)  to minimize  any such  increased  cost.  A
certificate  as to the  amount  of such  increase  in  costs,  submitted  to the
Borrowers and the  Administrative  Agent by such Bank,  shall be conclusive  and
binding for all purposes under this Section 2.13(a), absent manifest error.

                  (b) If any Bank  determines  that  compliance  with any law or
regulation  or any  guidelines  or  request  from  any  central  bank  or  other
governmental  authority  (whether  or not  having  the  force  of law)  which is
enacted,  adopted or issued at any time and from time to time after  December 8,
1997  affects or would  affect the amount of capital  required or expected to be
maintained by such Bank or any  corporation  controlling  such Bank and that the
amount of such  capital  is  increased  by or based upon the  existence  of such
Bank's  commitment to lend hereunder and other  commitments of this type,  then,
upon  demand by such  Bank  (with a copy of such  demand  to the  Administrative
Agent), the Borrowers shall immediately pay to the Administrative  Agent for the
account of such Bank,  from time to time as specified  by such Bank,  additional
amounts  sufficient to compensate such Bank in the light of such  circumstances,
to the extent that such Bank  reasonably  determines such increase in capital to
be  allocable  to the  existence of such Bank's  commitment  to lend  hereunder,
provided that such Bank shall exercise  reasonable efforts  (consistent with its
internal  policy and legal and  regulatory  restrictions)  to minimize  any such
compensation  payable  by the  Borrowers  hereunder.  A  certificate  as to such
amounts  submitted to the Borrowers and the  Administrative  Agent by such Bank,
shall be conclusive and binding for all purposes, absent manifest error.

                  (c) (1) Any and all  payments  by any  Borrower  hereunder  or
under the Notes shall be made, in accordance  with Section 2.15,  free and clear
of and  without  deduction  for any and all  present  or future  taxes,  levies,
imposts,  deduction,  charges or withholdings,  and all liabilities with respect
thereto, excluding, in the case of each Bank and the Administrative Agent, taxes
that are imposed on its  overall net income by the United  States and taxes that
are  imposed on its  overall net income  (and  franchise  taxes  imposed in lieu
thereof) by the state or foreign  jurisdiction under the laws of which such Bank
or the  Administrative  Agent (as the case may be) is organized or any political
subdivision thereof and, in the case of each Bank, taxes that are imposed on its
overall net income ( and  franchise  taxes imposed in lieu thereof) by the state
or  foreign  jurisdiction  of  such  Bank's  Applicable  Lending  Office  or any
political  subdivision  thereof (all such non-excluded taxes,  levies,  imposts,
deductions,  charges,  withholdings  and  liabilities  in  respect  of  payments
hereunder or under the Notes being hereinafter  referred to as "Taxes").  If any
Borrower  shall be required by law to deduct any Taxes from or in respect to any
sum payable hereunder or under any Note to any Bank or the Administrative Agent,
(i) the sum payable  shall be increased as may be necessary so that after making
all required  deductions  (including  deductions  applicable to additional  sums
payable under this Section  2.13(c)) such Bank or the  Administrative  Agent (as
the case may be) receives an amount equal to the sum it would have  received had
no such  deductions been made, (ii) such Borrower shall make such deductions and
(iii) such Borrower shall pay the full amount deducted to the relevant  taxation
authority or other authority in accordance with applicable law.

                        (2) In addition,  each Borrower shall pay any present or
                 future stamp,  documentary,  excise, property or similar taxes,
                 charges,  or levies that arise from any payment made  hereunder
                 or  under  the  Notes  or  from  the  execution,   delivery  or
                 registration  of,  performing  under, or otherwise with respect
                 to, this  Agreement  or the Notes  (hereinafter  referred to as
                 "Other Taxes").

                        (3) Each  Borrower  shall  indemnify  each  Bank and the
                 Administrative  Agent for and hold it harmless against the full
                 amount  of Taxes and Other  Taxes,  and for the full  amount of
                 taxes  of any  kind  imposed  by any  jurisdiction  on  amounts
                 payable under this Section 2.13(c),  imposed on or paid by such
                 Bank or the  Administrative  Agent (as the case may be) and any
                 liability ( including penalties, additions to tax, interest and
                 expenses)  arising  therefrom  or with  respect  thereto.  This
                 indemnification shall be made within 30 days from the date such
                 Bank or the  Administrative  Agent  (as the case may be)  makes
                 written demand therefor.

                        (4)  Within  30 days  after the date of any  payment  of
                 Taxes,  the Borrower which paid such Taxes shall furnish to the
                 Administrative  Agent,  at its  address  referred to in Section
                 8.02, the original or a certified copy of a receipt  evidencing
                 such payment. In the case of any payment hereunder or under the
                 Notes by or on behalf of any  Borrower  through  an  account or
                 branch  outside  the  United  States  or by or on behalf of any
                 Borrower by a payor that is not a United States person,  if the
                 Borrower  determines  that no  taxes  are  payable  in  respect
                 thereof, such Borrower shall furnish, or shall cause such payor
                 to furnish,  to the Administrative  Agent, at such address,  an
                 opinion  of  counsel  acceptable  to the  Administrative  Agent
                 stating that such payment is exempt from Taxes. For purposes of
                 this  subsection  (4) and  subsection  (5),  the terms  "United
                 States"  and "United  States  person"  shall have the  meanings
                 specified in Section 7701 of the Internal Revenue Code.

                        (5) Each Bank organized under the laws of a jurisdiction
                 outside the United States shall, on or prior to the date of its
                 execution  and delivery of this  Agreement (in the case of each
                 Bank listed in Schedule I attached  hereto),  and from the date
                 on which any other Bank  becomes  party  hereto (in the case of
                 each other Bank), and from time to time thereafter as requested
                 in  writing  by TBC (but only so long  thereafter  as such Bank
                 remains   lawfully  able  to  do  so),   provide  each  of  the
                 Administrative Agent and TBC with two original Internal Revenue
                 Service forms 1001 or 4224, as appropriate, or any successor of
                 other  form  prescribed  by  the  Internal   Revenue   Service,
                 certifying  that  such  Bank is exempt  from or  entitled  to a
                 reduced  rate of  United  States  withholding  tax on  payments
                 pursuant to this Agreement or the Notes.  If the forms provided
                 by a Bank at the time such Bank  first  becomes a party to this
                 Agreement  indicates a United States  interest  withholding tax
                 rate in excess of zero,  withholding  tax at such rate shall be
                 considered  excluded  from  Taxes  unless  and until  such Bank
                 provides the  appropriate  form  certifying  that a lesser rate
                 applies,  whereupon  withholding  tax at such  lesser rate only
                 shall be considered excluded from Taxes for periods governed by
                 such form; provided,  however,  that, if at the date on which a
                 Bank becomes a party to this  Agreement,  the Bank assignor was
                 entitled to payments  under  subsection (1) above in respect of
                 United States  withholding tax with respect to interest paid at
                 such date,  then, to such extent,  the term Taxes shall include
                 (in  addition to  withholding  taxes that may be imposed in the
                 future or other amounts  otherwise  includable in Taxes) United
                 States withholding tax, if any,  applicable with respect to the
                 Bank assignee on such date. If any form or document referred to
                 in this  subsection (5) requires the disclosure of information,
                 other than information necessary to compute the tax payable and
                 information  required on the date  hereof by  Internal  Revenue
                 Service form 1001 or 4224, that the Bank  reasonably  considers
                 to be  confidential,  the Bank shall give notice thereof to the
                 Borrower  and shall not be obligated to include in such form or
                 document confidential information.

                        (6) For any  period  with  respect to which any Bank has
                 failed to provide TBC with the  appropriate  form  described in
                 subsection  (5) above  (other than if such  failure is due to a
                 change  in  law  occurring  after  the  date  on  which  a form
                 originally  was  required  to  be  provided  or  if  such  form
                 otherwise is not required  under  subsection  (5) above),  such
                 Bank shall not be entitled to indemnification  under subsection
                 (1) or (3) with respect to Taxes  imposed by the United  States
                 by reason of such  failure;  provided,  however,  that should a
                 Bank become  subject to Taxes because of its failure to deliver
                 a form  required  hereunder,  TBC shall take such steps as such
                 Bank shall  reasonably  request to assist  such Bank to recover
                 such Taxes.

                  (d) Upon receipt of notice from any Bank claiming compensation
pursuant  to this  Section  2.13 and as long as no Event of Default and no event
which with notice or lapse of time or both would  constitute an Event of Default
shall have occurred and be  continuing,  TBC shall have the right,  on or before
the 30th day after the date of receipt of such notice, (i) to arrange for one or
more  Banks or other  commercial  banks to assume the  Commitment  of such Bank;
subject,  however, to payment to Administrative Agent by assignor or assignee of
a processing and recording fee of $3,500,  in the event the replacement  bank is
not a Bank; or (ii) to arrange for the  Commitment of such Bank to be terminated
and all A Advances owed to such Bank to be prepaid; and, in either case, subject
to payment in full of all principal, accrued and unpaid interest, fees and other
amounts  payable under this  Agreement  and then owing to such Bank  immediately
prior to the assignment or termination of the Commitment of such Bank.

                  Section 2.14. Illegality.  If there is any introduction of, or
change  in, or in the  interpretation  of, any law or  regulation,  which in the
opinion of counsel for the  Administrative  Agent in the  relevant  jurisdiction
shall make it unlawful,  or if any central bank or other governmental  authority
shall assert that it is  unlawful,  for any Bank to continue to fund or maintain
any  Eurodollar  Rate  Advances or to perform its  obligations  with  respect to
Eurodollar  Rate  Advances  as  provided  hereunder,  upon the  issuance of such
opinion of counsel or such  assertion  by a central  bank or other  governmental
authority and notice given to the  Borrowers  (accompanied  by such opinion,  if
applicable) by the  Administrative  Agent,  the Borrowers shall forthwith either
(1) prepay in full all Eurodollar Rate A Advances made by such Bank as a part of
Eurodollar  Rate A  Borrowings,  with  accrued  interest  thereon  and all other
amounts  which may be  payable  to such Bank by the  Borrowers  as  provided  in
Section  2.12(b) or (2) Convert all such Eurodollar Rate A Advances made by such
Bank into A Borrowings  of another Type as provided in Section  2.11.  Upon such
demand or such notice of prepayment or  Conversion,  the obligation of such Bank
to make or to  Convert A Advances  into,  Eurodollar  Rate A  Advances  shall be
suspended  until  such  time as the  event  giving  rise to such  prepayment  or
Conversion  shall no longer apply,  at which time the Commitment of such Bank to
make A  Advances  for the  funding  of,  or  Conversion  to,  Eurodollar  Rate A
Borrowings shall be reinstated, subject to its then available Commitment.

                  Section  2.15.  Payments and  Computations.  (a) The Borrowers
shall make each payment  hereunder and under the Notes not later than 11:00 a.m.
(New York City time) on the day when due in U.S.  dollars to the  Administrative
Agent at the Agent's Account in same day funds.  The  Administrative  Agent will
promptly  thereafter  cause to be distributed like funds relating to the payment
of principal or interest or fees ratably (other than amounts payable pursuant to
Section 2.05,  2.09,  2.13, 2.14, or 2.17) to the Banks for the account of their
respective Applicable Lending Offices, and like funds relating to the payment of
any  other  amount  payable  to any  Bank to such  Bank for the  account  of its
Applicable  Lending  Office,  in each case to be applied in accordance  with the
terms of this  Agreement.  From and after the  effective  date of an  assignment
pursuant to Section  2.18,  the  Administrative  Agent  shall make all  payments
hereunder and under the Notes in respect of the interest assigned thereby to the
Bank  assignee  thereunder,  and the parties to such  assignment  shall make all
appropriate adjustments in such payments for the periods prior to such effective
date directly between themselves.

                  (b) All  computations of interest based on the Base Rate shall
be made by the  Administrative  Agent on the basis of a year of 365 or 366 days,
as the case may be, and all  computations  of interest  based on the  Eurodollar
Rate or the  Federal  Funds  Rate  and of  Facility  Fees  shall  be made by the
Administrative  Agent, and all computations of interest pursuant to Section 2.09
shall be made by a Bank,  on the basis of a year of 360  days,  in each case for
the actual number of days  (including  the first day but excluding the last day)
occurring  in the period  for which  such  interest  or fees are  payable.  Each
determination by the Administrative Agent (or, in the case of Section 2.09, by a
Bank) of an interest  rate  hereunder  shall be  conclusive  and binding for all
purposes, absent manifest error.

                  (c) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business  Day, such payment shall be made
on the next  succeeding  Business Day, and such  extension of time shall in such
case be included in the  computation  of payment of interest or fee, as the case
may be; provided,  however, if such extension would cause payment of interest on
or  principal  of  Eurodollar  Rate  Advances  to be made in the next  following
calendar month, such payment shall be made on the next preceding Business Day.

                  (d) Unless the Administrative Agent shall have received notice
from a  Borrower  prior to the date on which  any  payment  is due to the  Banks
hereunder   that  such  Borrower  will  not  make  such  payment  in  full,  the
Administrative  Agent may assume that the Borrower has made such payment in full
to the Administrative  Agent on such date and the  Administrative  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
such Borrower shall not have so made such payment in full to the  Administrative
Agent,  each Bank shall repay to the  Administrative  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 Administrative Agent, at the Federal Funds Rate.

                  Section  2.16.  Sharing of  Payments,  Etc.  If any Bank shall
obtain any payment (whether voluntary,  involuntary, through the exercise of any
right of set-off,  or  otherwise) on account of the A Advances made by it (other
than pursuant to Sections 2.09,  2.13,  2.14 or 2.17),  in excess of its ratable
share of payments on account of the A Advances  obtained by all the Banks,  such
Bank shall forthwith purchase from the other Banks such  participations in the A
Advances  made by them as shall be  necessary to cause such  purchasing  Bank to
share the excess payment ratably with each of them, provided,  however,  that if
all or any  portion of such excess  payment is  thereafter  recovered  from such
purchasing  Bank,  such purchase from each Bank shall be rescinded and such Bank
shall  repay to the  purchasing  Bank the  purchase  price to the extent of such
recovery  together with an amount equal to such Bank's ratable share  (according
to the  proportion of (i) the amount of such Bank's  required  repayment to (ii)
the total amount so recovered from the purchasing Bank) of any interest or other
amount paid or payable by the purchasing  Bank in respect of the total amount so
recovered.  The Borrowers agree that any Bank so purchasing a participation from
another Bank pursuant to this Section 2.16 may, to the fullest extent  permitted
by law, exercise all its rights of payment (including the right of set-off) with
respect to such  participation  as fully as if such Bank were a creditor  of the
Borrowers in the amount of such participation.

                  Section 2.17.  Alteration of Commitments and Addition of
Banks.  By a written agreement executed only by TBC, the Administrative Agent
and the Bank or bank affected:

                 (i)       Increased Commitment:  the Commitment of such Bank
may be increased to the amount set forth in such agreement;

                 (ii)      Addition of a Bank:  such bank may be added as a
Bank with a Commitment as set forth in such agreement provided that it agrees
to be bound by all the terms and provisions of this Agreement; and

                 (iii)     Reduction or Termination of Commitment:  the unused
portion of the Commitment of such Bank may be reduced or terminated and the
A Advances owing to such Bank may be prepaid in whole or in part, all as set
forth in such agreement.

                  The  Administrative  Agent  may  execute  any  such  agreement
without the prior  consent of any Bank  (other than the Bank or bank  affected),
except that if at the time the  Administrative  Agent  proposes to execute  such
agreement  either (A) TBC's long-term  senior unsecured debt is rated lower than
BBB by S&P or lower than Baa2 by Moody's or (B) an Event of Default, or an event
which with notice or lapse of time or both would constitute an Event of Default,
shall have occurred and be continuing,  then the Administrative  Agent shall not
execute  any such  agreement  unless it has  first  obtained  the prior  written
consent of the Majority Banks and provided that the  Administrative  Agent shall
not execute any such agreement without the prior written consent of the Majority
Banks if such agreement would increase the total of the Commitments to an amount
in excess of  $1,600,000,000.  The  Administrative  Agent  shall  give each Bank
prompt notice of any such agreement  becoming  effective.  All requests for Bank
consent  under the  provisions  of this Section 2.17 shall specify the date upon
which any such increase, addition,  reduction,  termination, or prepayment shall
become effective (the "Effective  Date") and shall be made by means of a Request
for  Alteration  substantially  in the form as set  forth in  Exhibit  C. On the
Effective  Date on which the  Commitment  of any Bank is  increased,  decreased,
terminated or created or on which  prepayment is made,  all as described in such
Request for  Alteration,  the  Borrowers or such Bank, as the case may be, shall
make available to the  Administrative  Agent not later than 12:30 p.m. (New York
City time) on such date,  in same day funds,  the amount,  if any,  which may be
required (and the  Administrative  Agent shall distribute such funds received by
it to the  Borrowers or to such Banks,  as the case may be) so that at the close
of business on such date the sum of the A Advances of each Bank then outstanding
shall be in the same  proportion to the total of the A Advances of all the Banks
then  outstanding  as  the  Commitment  of  each  Bank  is to the  total  of the
Commitments.  The Administrative Agent shall give each Bank notice of the amount
to be made available by, or to be distributed  to, such Bank at least 5 Business
Days before such payment is made.

                  Section 2.18.  Assignments;  Sales of Participations and Other
Interests in Notes.  (a) From time to time each Bank may with the prior  written
consent of TBC and the affected  Borrowers and subject to the qualifications set
forth  below,  assign to one or more Banks or an  Eligible  Assignee  all or any
portion of its rights and obligations under this Agreement  (including,  without
limitation,  all or a portion of its Commitment,  the A Advances owing to it and
all A Notes  held by it) and  will,  at any time,  if  arranged  by the  Company
pursuant to clause (A) of this  sentence  upon at least 30 days'  notice to such
Bank and the Administrative  Agent, assign to one or more Eligible Assignees all
of  its  rights  and  obligations  under  this  Agreement   (including   without
limitation,  all of its  Commitment,  the A Advances owing to it and all A Notes
held by it); provided, however, that if such Bank shall notify TBC, the affected
Borrowers and the  Administrative  Agent of its intent to request the consent of
TBC and the affected  Borrowers to an assignment,  TBC shall have the right, for
30 days after  receipt of such  notice and so long as no Event of Default  shall
have occurred and be continuing,  in its sole  discretion  either (A) to arrange
for one or more  Eligible  Assignees  to accept  such  assignment  (a  "Required
Assignment")  or (B) to  arrange  for the rights  and  obligations  of such Bank
(including,   without  limitation,  such  Bank's  Commitment),   and  the  total
Commitments  of the Banks to be reduced by an amount equal to the amount of such
Bank's  Commitment  to be assigned and in  connection  with such  reduction,  to
prepay  that  portion of the A Advances  owing to such Bank which it proposes to
assign;  provided  further  that if TBC  fails to  notify  such Bank that it has
arranged  for an  assumption  or reduction  of the portion of  Commitment  to be
assigned within 30 days of the receipt by TBC of such Bank's request for consent
to  assignment,  the  Borrowers  shall be  deemed  to  consent  to the  proposed
assignment;  provided further that (i) any such assignment shall not require the
Borrowers to file a  registration  statement  with the  Securities  and Exchange
Commission  or apply to qualify the A Notes under the blue sky laws of any state
and the  assigning  Bank  shall  otherwise  comply  with all  federal  and state
securities laws applicable to such assignment; (ii) the amount of the Commitment
of  the  assigning  Bank  being  assigned   pursuant  to  each  such  assignment
(determined as of the date of the assignment)  shall either (A) equal 50% of all
such rights and  obligations  (or 100% in the case of a Required  Assignment) or
(B) not be less than $10,000,000 or an integral multiple of $1,000,000 in excess
thereof,  and (iii) the aggregate amount of the Commitment of the assigning Bank
assigned  pursuant to all such  assignments of such Bank (after giving effect to
such assignment)  shall in no event exceed 50% (except in the case of a Required
Assignment)  of all such Bank's  Commitment  (as set forth in Schedule I, in the
case of each Bank that is a party  hereto as of September  29,  1999,  or as set
forth in the Register as the aggregate Commitment assigned to such Bank pursuant
to one or more  assignments,  in the  case of any  assignee).  No Bank  shall be
obligated  to make a Required  Assignment  unless such Bank shall have  received
payments  in an  aggregate  amount at least equal to the  outstanding  principal
amount of all A Advances being assigned,  together with accrued interest thereon
to the date of payment of such principal amount and all other amounts payable to
such Bank under this Agreement  (including  without  limitation  Section 2.12(c)
provided  that such Bank shall receive its pro rata share of the Facility Fee on
the next  date on which  the  Facility  Fee is  payable).  From  and  after  the
effective  date of any  assignment  pursuant to this  Section  2.18(a),  (x) the
assignee  thereunder  shall be a party hereto and, to the extent that rights and
obligations  hereunder have been assigned to it pursuant to such assignment have
the rights and obligations of a Bank hereunder except that such assignee may not
elect to assign any of its rights and obligations under this Agreement  acquired
by any assignment  pursuant to this Section  2.18(a) for a period of nine months
following  the  effective  date  specified in such  assignment  and (y) the Bank
assignor  thereunder shall, to the extent that rights and obligations  hereunder
have been assigned by it pursuant to such  assignment  relinquish its rights and
be released from its  obligations  under this Agreement  (and, in the case of an
assignment  covering all or the remaining  portion of an assigning Bank's rights
and  obligations  under  this  Agreement,  such Bank  shall  cease to be a party
hereto).  Notwithstanding any other provision in this Agreement, any Bank may at
any time (aa)  create a security  interest  in all or any  portion of its rights
under this Agreement (including without limitation, the Advances owing to it and
the Notes held by it) in favor of any Federal  Reserve Bank in  accordance  with
Regulation A of the Board of Governors of the Federal Reserve  System,  and (bb)
assign all or any  portion of its rights and  obligations  under this  Agreement
(including,  without  limitation,  all or a  portion  of its  Commitment,  the A
Advances  owing to it and all A Notes held by it) to an  affiliate of such Bank,
except if the result of the  assignment is to increase the cost to the Borrowers
of  requesting,  borrowing,  continuing,  maintaining,  paying or converting any
Advances,  provided in each case that such Bank gives  prior or  contemporaneous
notice  to  TBC,  the  affected  Borrowers  and  Administrative   Agent  of  the
assignment.

                  (b) The  Administrative  Agent  shall  maintain at its address
referred to in Section 8.02 a copy of each assignment  delivered to and accepted
by it and a register for the recordation of the names and addresses of the Banks
and the Commitment  of, and principal  amount of the A Advances of each Borrower
owing to,  each Bank from time to time  (the  "Register").  The  entries  in the
Register  shall be  conclusive  and binding for all  purposes,  absent  manifest
error, and the Borrowers,  the Administrative Agent and the Banks may treat each
entity  whose name is  recorded  in the  Register  as a Bank  hereunder  for all
purposes of this  Agreement.  The Register  shall be available for inspection by
the  Borrowers  or any Bank at any  reasonable  time and from  time to time upon
reasonable  prior  notice.  Upon  receipt by the  Administrative  Agent from the
assigning  Bank of an  assignment  in form  and  substance  satisfactory  to the
Administrative Agent executed by an assigning Bank and an assignee  representing
that it is an  Eligible  Assignee,  together  with each A Note  subject  to such
assignment,  and a processing and recording fee of $3,500 (payable by either the
assignor or the assignee), the Administrative Agent shall, if such assignment is
a Required  Assignment  or has been  consented to by the Borrowers to the extent
required by Section  2.18(a) or has been effected  pursuant to Section  2.19(c),
(i) accept such assignment, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to TBC and the affected Borrowers.
Within five Business Days after its receipt of such notice, the Company,  at its
own expense,  shall execute and deliver to the Administrative  Agent in exchange
for each surrendered A Note a new A Note to the order of such Eligible  Assignee
in an amount equal to the Commitment  assumed by it pursuant to such assignment,
and if the assigning Bank has retained a Commitment  hereunder,  a new A Note to
the order of the assigning Bank in an amount equal to the Commitment retained by
it  hereunder.  Such new A Note or A Notes  shall be in an  aggregate  principal
amount equal to the principal  amount of such surrendered A Note, shall be dated
the effective date of such  assignment and shall otherwise be  substantially  in
the form of Exhibit A-1 or A-2 hereto, as appropriate.

                  (c) Each Bank may sell  participations  in all or a portion of
its rights and obligations under this Agreement (including,  without limitation,
all or a portion of its Commitments, the Advances owing to it and the Notes held
by it) to one or more affiliates of such Bank or to one or more other commercial
banks; provided,  however, that (i) any such participation shall not require the
Borrowers to file a  registration  statement  with the  Securities  and Exchange
Commission  or apply to qualify  the Notes  under the blue sky laws of any state
and the Bank selling or granting such participation  shall otherwise comply with
all federal and state  securities laws applicable to such  transaction,  (ii) no
purchaser of such a  participation  shall be  considered  to be a "Bank" for any
purpose under the Agreement,  (iii) such Bank's obligations under this Agreement
(including, without limitation, its Commitment to the Borrowers hereunder) shall
remain  unchanged,  (iv) such Bank shall remain solely  responsible to the other
parties  hereto for the  performance  of such  obligations,  (v) such Bank shall
remain the holder of such Notes for all purposes of this Agreement, and (vi) the
Borrowers,  the Administrative  Agent and the other Banks shall continue to deal
solely and directly  with such Bank in  connection  with such Bank's  rights and
obligations under this Agreement.

                  (d) Any  Bank  may,  in  connection  with  any  assignment  or
participation or proposed  assignment or participation  pursuant to this Section
2.18,   disclose  to  the  assignee  or  participant  or  proposed  assignee  or
participant, any information relating to the Borrowers furnished to such Bank by
or on  behalf  of the  Borrowers;  provided,  however,  that,  prior to any such
disclosure of information that is not publicly available, such Bank shall obtain
the  written  consent of the  Borrowers,  and the  assignee  or  participant  or
proposed assignee or participant shall agree to preserve the  confidentiality of
any such  information  received by it from such Bank except as disclosure may be
required or appropriate to governmental  authorities,  pursuant to legal process
or by law or governmental regulation or authority.

                  Section 2.19.  Extension of Termination  Date. (a) TBC may, on
behalf  of  itself  and the  Subsidiary  Borrowers,  by  written  notice  to the
Administrative  Agent  in the  form of  Exhibit  E (each  such  notice  being an
"Extension  Request")  given no  earlier  than 45 days and no later than 30 days
prior to the then applicable  Termination Date, request that the then applicable
Termination  Date be  extended  to a date 364  days  after  the then  applicable
Termination  Date.  Such extension  shall be effective with respect to each Bank
which, by a written notice in the form of Exhibit F (a "Continuation Notice") to
TBC and the Administrative Agent given no earlier than 30 days and no later than
20 days prior to the then applicable  Termination  Date,  consents,  in its sole
discretion,  to such  extension  (each Bank giving a  Continuation  Notice being
referred  to  sometimes  as a  "Continuing  Bank"  and each  Bank  other  than a
Continuing  Bank being a  "Non-Extending  Bank")  provided,  however,  that such
extension shall be effective only if the aggregate Commitments of the Continuing
Banks are not less than 66-2/3% of the aggregate Commitments of the Banks on the
date of the Extension  Request.  No Bank shall have any obligation to consent to
any such  extension of the  Termination  Date.  The  Administrative  Agent shall
notify  each  Bank of the  receipt  of an  Extension  Request  within  three (3)
Business Days after receipt thereof.  The Administrative  Agent shall notify the
Company and the Banks no later than 15 days prior to the applicable  Termination
Date whether the  Administrative  Agent has received  Continuation  Notices from
Banks holding at least 66-2/3% of the Aggregate  Commitments  on the date of the
Extension Request.

                  (b) The Commitment of each  Non-Extending Bank shall terminate
at the close of business on the Termination Date in effect prior to the delivery
of such Extension Request without giving any effect to such proposed  extension,
and on such Termination Date TBC shall take one of the following three actions:

                 (i)       Replace the Non-Extending Banks pursuant to
         Section 2.19(c); or

                 (ii) Pay or cause to be paid to the  Administrative  Agent, for
         the  account  of  the  Non-Extending  Banks,  an  amount  equal  to the
         Non-Extending  Banks' A  Advances,  together  with  accrued  but unpaid
         interest and fees thereon and all other amounts then payable hereunder;
         or

                 (iii) By  giving  notice to the  Administrative  Agent no later
         than three days prior to the Termination  Date, elect not to extend the
         Termination  Date beyond the then  applicable  Termination  Date and in
         this event the Borrowers may in their sole discretion  repay any amount
         of the A Advances then  outstanding or make an A Borrowing  pursuant to
         Article 2 and the amount of the A Advances outstanding thereafter shall
         convert to a term loan pursuant to Section 2.03.

                  (c) A Non-Extending Bank shall be obligated, at the request of
TBC to assign at any time prior to the close of business on the Termination Date
applicable to such  Non-Extending Bank all of its rights (other than rights that
would survive the  termination  of the  Agreement  pursuant to Section 8.03) and
obligations  hereunder to one or more Banks or other  commercial banks nominated
by TBC and  willing  to become  Banks in place of such  Non-Extending  Bank (the
"Replacement  Banks"). In order to qualify as a Replacement Bank, a Bank or bank
must  satisfy  all of the  requirements  of this  Agreement  (including  without
limitation  the terms of Section 2.18  relating to Required  Assignments).  Such
obligation  of the  Non-Extending  Banks is subject to such  Non-Extending  Bank
receiving (i) payment in full from the Replacement Banks of the principal amount
of all  Advances  owing  to such  Non-Extending  Bank  immediately  prior  to an
assignment to the Replacement  Banks and (ii) payment in full from the Borrowers
of all accrued  interest and fees and other amounts  payable  hereunder and then
owing to such  Non-Extending  Bank  immediately  prior to the  assignment to the
Replacement Banks. Upon such assignment,  the Non-Extending Bank shall no longer
be a Bank,  such  Replacement  Banks  shall  become  Continuing  Banks,  and the
Administrative  Agent shall make appropriate  entries in the Register to reflect
the foregoing.

                  Section 2.20. Subsidiary  Borrowers.  (a) TBC may at any time,
and from time to time,  by  delivery to the  Administrative  Agent of a Borrower
Subsidiary Letter  substantially in the form of Exhibit D hereto,  duly executed
by TBC and the respective Subsidiary, designate such Subsidiary as a "Subsidiary
Borrower" for purposes of this Agreement,  and such  Subsidiary  shall thereupon
become a  "Subsidiary  Borrower"  for purposes of this  Agreement  and, as such,
shall have all of the  rights  and  obligations  of a  Borrower  hereunder.  The
Administrative Agent shall promptly notify each Bank of each such designation by
TBC and the identity of the respective Subsidiary.

                  (b) No Advances shall be made to a Subsidiary Borrower, and no
Conversion  of any  Advances at the request of a  Subsidiary  Borrower  shall be
effective, without, in each and every instance, the prior consent of TBC, in its
sole discretion,  which shall be evidenced by the countersignature of TBC to the
relevant  Notice of Borrowing or notice of Conversion.  In addition,  no notices
which are to be  delivered  by a Borrower  hereunder  shall be  effective,  with
respect to any Subsidiary Borrower, unless the notice is countersigned by TBC.

                  (c) The occurrence of any of the following events with respect
to any Subsidiary Borrower shall constitute a "Subsidiary  Borrower  Termination
Event" with respect to such Subsidiary Borrower:

                 (i)   such Subsidiary Borrower shall cease to be a Subsidiary,
         as defined under this Agreement;

                 (ii)  such Subsidiary Borrower shall liquidate or dissolve;

                 (iii) such  Subsidiary  Borrower  shall fail to  preserve  and
         maintain its existence, or shall make any material change in the nature
         of its  business  as carried out on the date such  Subsidiary  Borrower
         becomes a Borrower hereunder;

                 (iv) such Subsidiary  Borrower shall merge or consolidate  with
         or into, or convey,  transfer,  lease, or otherwise dispose of (whether
         in one transaction or in a series of transactions) all or substantially
         all of its assets  (whether  now owned or  hereafter  acquired)  to any
         Person (except that a Subsidiary  Borrower may merge into or dispose of
         assets to another Borrower); or

                 (vii) any of the "Events of Default"  described in Section 6.01
         shall occur to or with respect to such  Subsidiary  Borrower as if such
         Subsidiary Borrower were TBC.

                  (d) Upon the occurrence of a Subsidiary  Borrower  Termination
Event with respect to any Subsidiary  Borrower,  such  Subsidiary  Borrower (the
"Terminated  Subsidiary  Borrower") shall cease to be a Borrower for purposes of
this  Agreement  and shall no longer be entitled  to request or borrow  Advances
hereunder. All outstanding Advances of a Terminated Subsidiary Borrower shall be
automatically  due and payable as of the date on which the  Subsidiary  Borrower
Termination Event of such Terminated Subsidiary Borrower occurred, together with
accrued  interest  thereon  and any other  amounts  then due and payable by that
Borrower  hereunder,  unless, in the case of a Subsidiary  Borrower  Termination
Event described in paragraph (iv) of Section 2.20(c),  the other Person party to
the transaction is a Borrower and such other Borrower has assumed in writing all
of the outstanding Advances and other obligations under this Agreement and under
the Notes of the Terminated Subsidiary Borrower.

                  (e)  Each  of the  Subsidiary  Borrowers  hereby  appoint  and
authorize  TBC to take such action as agent on their behalf and to exercise such
powers  under  this  Agreement  as are  delegated  to TBC by the  terms  hereof,
together with such powers as are reasonably incidental thereto.

                  (f)   Notwithstanding   anything  in  this  Agreement  to  the
contrary,  each of the Subsidiary  Borrowers  shall be severally  liable for the
liabilities and obligations of such Subsidiary Borrower under this Agreement and
its Notes, and no Subsidiary Borrower shall be liable for the obligations of any
other  Borrower  under this  Agreement  and such other  Borrower's  Notes.  Each
Subsidiary  Borrower shall be severally liable for all payments of the principal
of and interest on Advances to such  Subsidiary  Borrower,  and any other amount
due hereunder that is specifically  allocable to such Subsidiary Borrower or the
Advances of such Subsidiary Borrower.  With respect to any amount due hereunder,
including fees, that is not specifically  allocable to any particular  Borrower,
each Borrower shall be liable for such amount pro rata in the same proportion as
such  Borrower's  outstanding  Advances  bear to the  total of  then-outstanding
Advances to all Borrowers.

                                    ARTICLE 3

                Representations, Warranties and Certain Covenants

                  Section 3.01. Representations and Warranties by the Borrowers.
Each of the Borrowers represent and warrant as follows:

                  (a)  TBC is a duly  organized  corporation  existing  in  good
standing under the laws of the State of Delaware.  Each  Subsidiary  Borrower is
duly  organized,  validly  existing and in good  standing  under the laws of the
jurisdiction of its organization,  and each of TBC and each Subsidiary  Borrower
is qualified to do business in every  jurisdiction  where such  qualification is
required,  except  where the  failure  to so  qualify  would not have a material
adverse effect on the financial condition of TBC and the Subsidiary Borrowers as
a whole.

                  (b) The  execution  and  delivery and the  performance  of the
terms of this  Agreement,  the Notes and each  Guaranty are within the corporate
powers  of each  Borrower  party  thereto,  have  been  duly  authorized  by all
necessary  corporate action, have received all necessary  governmental  approval
(which  approval  remains in full force and effect),  and do not  contravene any
law,  any  provision  of the  Certificate  of  Incorporation  or  By-Laws of any
Borrower party thereto or any  contractual  restriction  binding on any Borrower
party thereto.

                  (c) This  Agreement  and the  Notes,  when duly  executed  and
delivered by each Borrower  party  thereto,  will  constitute  legal,  valid and
binding  obligations  of such  Borrower,  enforceable  against such  Borrower in
accordance with their respective  terms,  and each Guaranty,  when duly executed
and delivered by TBC, will constitute a legal,  valid and binding  obligation of
TBC, enforceable against TBC in accordance with its terms.

                  (d) In TBC's  opinion,  there  are no  pending  or  threatened
actions or  proceedings  before  any court or  administrative  agency  which can
reasonably be expected to materially adversely affect the financial condition or
operations  of the Company or of the Company  and its  Subsidiaries,  taken as a
whole.

                  (e) The  Consolidated  statement of  financial  position as of
December  31,  1998 and the  related  Consolidated  statement  of  earnings  and
retained  earnings for the year then ended (copies of which have been  furnished
to each Bank) correctly set forth the  Consolidated  financial  condition of TBC
and  its  Subsidiaries  as of  such  date  and the  result  of the  Consolidated
operations for such year, and since such date there has been no material adverse
change in such condition or operations  which is likely to impair the ability of
TBC to repay the Advances.

                  (f) No Borrower is engaged in the business of extending credit
for the purpose of  purchasing  or carrying  margin  stock within the meaning of
Regulation U issued by the Board of Governors of the Federal Reserve System, and
no proceeds of any Advance will be used to purchase or carry any margin stock or
to extend  credit to others for the purpose of purchasing or carrying any margin
stock.  Following  application of the proceeds of each Advance, not more than 25
percent  of the value of the  assets  (either  of any  Borrower  only or of each
Borrower and its subsidiaries on a consolidated basis) subject to the provisions
of Section  4.02(a)  will be margin  stock  (within the meaning of  Regulation U
issued by the Board of Governors of the Federal Reserve System).

                  (g) No Borrower is an "investment  company," or an "affiliated
person"  of, or  "promoter"  or  "principal  underwriter"  for,  an  "investment
company," as such terms are defined in the  Investment  Company Act of 1940,  as
amended. Neither the making of any Advances, nor the application of the proceeds
or  repayment  thereof  by any  Borrower,  nor  the  consummation  of the  other
transactions  contemplated hereby, will violate any provision of such Act or any
rule, regulation or order of the Securities and Exchange Commission thereunder.

                  Section  3.02.   Representation   by  the  Banks.   Each  Bank
represents  that its present intent is that it will acquire the A Notes drawn to
its order for its own  account and that each such A Note is being  acquired  for
the purpose of investment and not with a view to distribution or resale thereof,
subject,  nevertheless, to the necessity that such Bank remain in control at all
times of the disposition of property held by it for its own account.

                                    ARTICLE 4

                                Covenants of TBC

                  Section 4.01.  Affirmative  Covenants of TBC. From the date of
this  Agreement  and so long as any amount shall be payable by the  Borrowers to
any Bank hereunder or any Commitment shall be outstanding, TBC will:

                  (a)  Furnish to the Banks:  (1) within 60 days after the close
of  each  of the  first  three  quarters  of  each  of  TBC's  fiscal  years,  a
Consolidated  statement of financial  position of TBC and the Subsidiaries as of
the end of such quarter and a Consolidated comparative statement of earnings and
retained  earnings of TBC and the Subsidiaries for the period  commencing at the
end of the previous  fiscal year and ending with the end of such  quarter,  each
certified by an  authorized  officer of TBC, (2) within 120 days after the close
of each of TBC's fiscal  years,  and if requested by the  Administrative  Agent,
within 60 days after the close of each of the first three  quarters  thereof,  a
statement  certified  by an  authorized  officer  of TBC  showing  in detail the
computations  required by the provisions of Sections 4.02(a),  4.02(b),  4.02(c)
and 4.02(d),  hereof,  based on the figures which appear on the books of account
of TBC and the  Subsidiaries at the close of such quarters,  (3) within 120 days
after the close of each of TBC's fiscal years, a copy of the annual audit report
of TBC,  certified by  independent  public  accountants  of recognized  standing
acceptable  to the  Administrative  Agent,  together with  financial  statements
consisting  of a  Consolidated  statement of  financial  position of TBC and the
Subsidiaries  as of the end of such fiscal year and a Consolidated  statement of
earnings and retained earnings of TBC and the Subsidiaries for such fiscal year,
(4) within 120 days after the close of each of TBC's fiscal  years,  a statement
certified by the  independent  public  accountants  who shall have  prepared the
corresponding  audit report furnished to the Banks pursuant to the provisions of
clause  (3) of this  subsection  (a),  to the  effect  that,  in the  course  of
preparing such audit report, such accountants had obtained no knowledge,  except
as specifically  stated, that TBC had been in violation of the provisions of any
one of the following Sections:  Sections 4.02(a),  4.02(b), 4.02(c) and 4.02(d),
at any time during such fiscal year, (5) promptly upon their becoming available,
all financial statements, reports and proxy statements which TBC may send to its
stockholders,  (6)  promptly  upon their  becoming  available,  all  regular and
periodic  financial  reports  which TBC or any  Subsidiary  shall  file with the
Securities  and Exchange  Commission or any national  securities  exchange,  (7)
within 3 Business Days after the discovery of the  occurrence of any event which
constitutes an Event of Default or would constitute an Event of Default with the
passage  of time or the  giving of notice,  or both,  notice of such  occurrence
together with a detailed statement by a responsible  officer of TBC of the steps
being  taken by TBC or the  appropriate  Subsidiary  to cure the  effect of such
event and (8) such other  information  respecting  the  financial  condition and
operations of TBC or the Subsidiaries as the Administrative  Agent may from time
to time reasonably request.

                  (b) Duly pay and discharge,  and cause each Subsidiary duly to
pay and discharge, all material taxes, assessments and governmental charges upon
it or against its properties  prior to a date which is 5 Business Days after the
date on which penalties are attached thereto, except and to the extent only that
the same shall be contested in good faith and by appropriate  proceedings by TBC
or the appropriate Subsidiary.

                  (c)  Maintain,  and cause each  Subsidiary  to maintain,  with
financially sound and reputable insurance  companies or associations,  insurance
of the  kinds,  covering  the risks and in the  relative  proportionate  amounts
usually  carried by companies  engaged in  businesses  similar to that of TBC or
such Subsidiary,  except, to the extent consistent with good business practices,
such insurance may be provided by TBC through its program of self insurance.

                  (d)      Preserve and maintain its corporate existence.

                  Section 4.02. General Negative Covenants of TBC. From the date
of this  Agreement and so long as any amount shall be payable by TBC to any Bank
hereunder or any Commitment shall be outstanding, TBC will not:

                  (a)  Create,  incur,  assume or suffer to exist any  mortgage,
pledge,  lien,  security interest or other charge or encumbrance  (including the
lien or retained security title of a conditional vendor) upon or with respect to
any of its  Property,  Plant  and  Equipment,  or upon or  with  respect  to the
Property, Plant and Equipment of any Subsidiary,  or assign or otherwise convey,
or permit any  Subsidiary  to assign or otherwise  convey,  any right to receive
income from or with respect to its  Property,  Plant and  Equipment,  except (1)
liens in connection with workmen's compensation, unemployment insurance or other
social  security  obligations,  (2)  liens  securing  the  performance  of bids,
tenders,  contracts  (other than for the repayment of borrowed  money),  leases,
statutory  obligations,  surety and appeal  bonds,  liens to secure  progress or
partial  payments made to TBC or such  Subsidiary and other liens of like nature
made  in  the  ordinary   course  of  business,   (3)   mechanics',   workmen's,
materialmen's  or other like liens arising in the ordinary course of business in
respect of  obligations  which are not due or which are being  contested in good
faith,  (4) liens for taxes not yet due or being  contested in good faith and by
appropriate proceedings by TBC or the affected Subsidiary,  and (5) other liens,
charges and  encumbrances,  so long as the aggregate  amount of the Consolidated
Debt for which all such liens,  charges and encumbrances  serve as security does
not exceed 15% of Consolidated net Property, Plant and Equipment.

                  (b) Permit  Consolidated  Debt to be at any time more than 60%
of Total Capital,  where "Total Capital" means the sum of  Shareholders'  Equity
and Consolidated Debt.
                  (c) Make any  payment,  or permit any  Subsidiary  to make any
payment,  of principal or interest on any Debt which payment would  constitute a
violation  of the terms of this  Agreement  or of the terms of any  indenture or
agreement  binding on such  corporation or to which such  corporation is a party
except,  in the case of any  payment  made by a  Subsidiary,  to the extent such
payment is not likely to impair the ability of TBC to repay the Advances.

                  (d) Merge or  consolidate  with or into, or convey,  transfer,
lease,  or otherwise  dispose of (whether in one  transaction  or in a series of
transactions)  all or  substantially  all of its  assets  (whether  now owned or
hereafter  acquired)  to any  Person  except  that  the  Borrower  may  merge or
consolidate with any Person so long as the Borrower is the surviving corporation
and no Event of  Default,  or event or  circumstance  that  with  notice or time
elapse or both would become an Event of Default,  has occurred and is continuing
or would result therefrom.

                  (e) Make any material change in the nature of its business as
carried out on the date hereof.

                  Section  4.03.  Financial  Statement  Terms.  For  purposes of
Section 4.02(b) above,  all  capitalized  terms shall be as they appear on TBC's
published  Consolidated  financial statements and calculated under the generally
accepted  accounting  principles and practices applied by TBC on the date hereof
in the preparation of such financial  statements.  However,  notwithstanding the
foregoing,  Total Capital shall exclude the effects of any  repurchase by TBC of
its  common  stock  and any  merger-related  accounting  adjustments  which  are
attributable  to  the  merger  with  or  acquisition  of the  McDonnell  Douglas
Corporation by TBC.

                  Section 4.04.  Waivers of  Covenants.  The departure by TBC or
any Subsidiary from the  requirements of any of the provisions of this Article 4
shall be  permitted  only if such  departure  shall  have been  consented  to in
advance in a writing  signed by Banks  representing  66-2/3% or more of the then
outstanding  aggregate  principal amount of the A Notes or, if no such principal
or face amount is outstanding, Banks having at least 66-2/3% of the total of the
Commitments,  and such  writing  shall be  effective  as a  consent  only to the
specific  departure  described  in such  writing.  Such  departure by TBC or any
Subsidiary when properly consented to by the required number of Banks as set out
in the preceding sentence shall not constitute an Event of Default under Section
6.01(c).

                                    ARTICLE 5

                       Conditions Precedent to Borrowings

                  Section 5.01. Conditions Precedent to the Initial Borrowing of
TBC. The  obligation of each Bank to make its initial  Advance to TBC is subject
to the fulfillment of all of the following conditions:

                  The Administrative  Agent shall have received on or before the
day of the initial  Borrowing  all of the  following,  each dated the day of the
initial  Borrowing,  in form and substance  satisfactory  to the  Administrative
Agent and its counsel.

                  (a) A Base Rate A Note,  a  Eurodollar  A Note, a Fixed Rate B
Note and a  Eurodollar  B Note  drawn to the  order of each  Bank  executed  and
delivered by TBC to the Administrative Agent for delivery to each Bank.

                  (b) Copies of all  documents,  certified by an officer of TBC,
evidencing necessary corporate action by TBC and governmental approvals, if any,
with respect to this Agreement and the Notes.

                  (c) A certificate  of the Secretary or an Assistant  Secretary
of TBC which shall  certify the names of the officers of TBC  authorized to sign
the Notes and the other documents to be delivered hereunder,  together with true
specimen  signatures  of such  officers  and  facsimile  signatures  of officers
authorized to sign by facsimile  signature.  Each Bank may conclusively  rely on
such  certificate  until it shall  have  received a further  certificate  of the
Secretary  or an  Assistant  Secretary  of TBC  canceling  or amending the prior
certificate  and  submitting  signatures  of the officers  named in such further
certificate.

                  (d) A  favorable  opinion  of the chief  legal  officer of TBC
substantially  in the form of Exhibit G hereto  and as to such other  matters as
the  Administrative  Agent may  reasonably  request,  which  opinion  TBC hereby
expressly instructs such chief legal officer to prepare and deliver.

                  (e) A favorable  opinion of  Shearman & Sterling,  counsel for
the Administrative Agent, substantially in the form of Exhibit H hereto.

                  (f) TBC shall have terminated in whole the commitments of the
banks parties to the Existing Credit Agreement .

                  (g) TBC and its Subsidiaries shall have satisfied all of their
respective  obligations under the Existing Credit Agreement  including,  without
limitation, the payment of all fees under such agreement.

                  Section 5.02. Conditions Precedent to Each A Borrowing of TBC.
The  obligation  of each Bank to make an A  Advance  on the  occasion  of each A
Borrowing (including the initial Borrowing) is subject to the further conditions
precedent that on the date of such request and the date of such  Borrowing,  the
following  statements  shall be true,  and each of the giving of the  applicable
Notice  of A  Borrowing  and the  acceptance  by TBC of the  proceeds  of such A
Borrowing shall be a representation by TBC that:

                 (i) the  representations  and  warranties  contained in Section
         3.01 hereof are true and accurate on and as of each such date as though
         made on and as of each  such  date  (except  to the  extent  that  such
         representations and warranties relate solely to an earlier date); and

                 (ii)  as of  each  such  date  no  event  has  occurred  and is
         continuing,  or  would  result  from the  proposed  A  Borrowing  which
         constitutes  an Event of Default or would  constitute  such an Event of
         Default but for the requirement  that notice be given or time elapse or
         both.

                  Section 5.03. Conditions Precedent to Each B Borrowing of TBC.
The  obligation  of each  Bank to make a B  Advance  on the  occasion  of each B
Borrowing (including the initial Borrowing) is subject to the further conditions
precedent  that (1) TBC shall  have  furnished  to the  Administrative  Agent in
connection  with such B  Borrowing,  (x) a  Consolidated  statement of financial
position  of TBC and the  Subsidiaries  as of the end of each of the first three
quarters of TBC's  fiscal year (other than a quarter  ending  within  sixty days
prior to the date of the  related  Notice  of B  Borrowing)  and a  Consolidated
comparative  statement  of  earnings  and  retained  earnings  of  TBC  and  the
Subsidiaries  for the period  commencing at the end of the previous  fiscal year
and ending with the end of such quarter, each certified by an authorized officer
of  TBC  and  (y) a copy  of the  annual  audit  report  of  TBC,  certified  by
independent  public  accountants  of  recognized   standing  acceptable  to  the
Administrative  Agent,  together  with  financial  statements  consisting  of  a
Consolidated  statement of the financial position of TBC and the Subsidiaries as
of the  end of the  applicable  fiscal  year  and a  Consolidated  statement  of
earnings and retained  earnings of TBC and the Subsidiaries for such fiscal year
(the applicable fiscal year being the most recent year with respect to which the
annual audit report of TBC is due pursuant to Section 4.01(a)(3)) and (2) on the
date of such request and the date of such  Borrowing,  the following  statements
shall be true,  and each of the giving of the  applicable  Notice of B Borrowing
and the  acceptance  by TBC of the  proceeds  of  such B  Borrowing  shall  be a
representation by TBC that:

                 (i) the  representations  and  warranties  contained in Section
         3.01 hereof are true and accurate on and as of each such date as though
         made on and as of each  such  date  (except  to the  extent  that  such
         representations and warranties relate solely to an earlier date);

                 (ii)  as of  each  such  date  no  event  has  occurred  and is
         continuing,  or  would  result  from the  proposed  B  Borrowing  which
         constitutes  an Event of Default or would  constitute  such an Event of
         Default but for the requirement  that notice be given or time elapse or
         both; and

                 (iii) no event has  occurred  and no  circumstance  exists as a
         result of which the  information  concerning TBC that has been provided
         by TBC to the Administrative Agent or the Banks in connection with such
         B Borrowing  would  include an untrue  statement of a material  fact or
         omit to  state  any  material  fact or any fact  necessary  to make the
         statements contained therein, in light of the circumstances under which
         they were made, not misleading.

                  Section 5.04. Conditions Precedent to the Initial Borrowing of
a Subsidiary  Borrower.  The obligation of each Bank to make its initial Advance
to  any  particular  Subsidiary  Borrower  is  subject  to  the  receipt  by the
Administrative  Agent,  on or before the day of the  initial  Borrowing  by such
Subsidiary  Borrower,  all of the  following,  each dated the day of the initial
Borrowing,  in form and substance  satisfactory to the Administrative  Agent and
its counsel:

                 (i)  A Borrower Subsidiary Letter, substantially in the form
         of Exhibit D hereto, executed by such Subsidiary Borrower and TBC;

                 (ii) A Base Rate A Note,  a  Eurodollar  A Note, a Fixed Rate B
         Note and a Eurodollar  B Note drawn to the order of each Bank  executed
         and delivered by the Subsidiary  Borrower to the  Administrative  Agent
         for delivery to each Bank.

                 (iii) Copies of all  documents,  certified by an officer of the
         Subsidiary  Borrower,  evidencing  necessary  corporate  action  by the
         Subsidiary Borrower and governmental approvals, if any, with respect to
         this Agreement and the Notes.

                 (iv) A certificate  of the Secretary or an Assistant  Secretary
         of TBC or the Subsidiary  Borrower which shall certify the names of the
         officers of the  Subsidiary  Borrower  authorized to sign the Notes and
         the other  documents  to be  delivered  hereunder,  together  with true
         specimen  signatures  of such  officers  and  facsimile  signatures  of
         officers  authorized  to sign by  facsimile  signature.  Each  Bank may
         conclusively  rely on such  certificate  until it shall have received a
         further  certificate of the Secretary or an Assistant  Secretary of TBC
         or the Subsidiary  Borrower canceling or amending the prior certificate
         and  submitting  signatures  of the  officers  named  in  such  further
         certificate.

                 (v) A favorable  opinion of in-house  counsel to the Subsidiary
         Borrower,  substantially in the form of Exhibit I hereto and as to such
         other matters as the Administrative Agent may reasonably request, which
         opinion TBC and each Subsidiary Borrower hereby expressly instruct such
         counsel to prepare and deliver.

                 (vi) The Guaranty of TBC, which unconditionally  guarantees the
         payment of all  obligations of such Subsidiary  Borrower  hereunder and
         under the Notes of such Subsidiary Borrower,  substantially in the form
         of  Exhibit  J  hereto,   executed   and   delivered   by  TBC  to  the
         Administrative Agent.

                  Section  5.05.  Conditions  Precedent to Each A Borrowing of a
Subsidiary  Borrower.  The  obligation  of each Bank to make an A  Advance  to a
Subsidiary  Borrower on the occasion of each A Borrowing  (including the initial
Borrowing) is subject to the further  conditions  precedent  that on the date of
such request and the date of such Borrowing,  the following  statements shall be
true,  and each of the giving of the  applicable  Notice of A Borrowing  and the
acceptance  by that  particular  Subsidiary  Borrower of the  proceeds of such A
Borrowing shall be (a) a representation by such Subsidiary Borrower that:

                 (i) the  representations  and  warranties  of  that  Subsidiary
         Borrower  contained (A) in Section 3.01 are true and accurate on and as
         of each such date as though made on and as of each such date (except to
         the extent that such representations and warranties relate solely to an
         earlier date), and (B) in its Borrower  Subsidiary  Letter are true and
         correct  on and as of the  date of such  borrowing,  before  and  after
         giving effect to such borrowing; and

                 (ii)  as of  each  such  date  no  event  has  occurred  and is
         continuing,  or  would  result  from the  proposed  A  Borrowing  which
         constitutes  an Event of Default or would  constitute  such an Event of
         Default but for the requirement  that notice be given or time elapse or
         both;

and (b) a representation by TBC that the  representations  and warranties of TBC
contained  in Section  3.01 are true and accurate on and as of each such date as
though  made on and as of  each  such  date  (except  to the  extent  that  such
representations  and warranties  relate solely to an earlier date), and that, as
of each such date, no event has occurred and is continuing, or would result from
the  proposed  A  Borrowing  which  constitutes  an  Event of  Default  or would
constitute such an Event of Default but for the requirement that notice be given
or time elapse or both.

                  Section  5.06.  Conditions  Precedent to Each B Borrowing of a
Subsidiary  Borrower.  The  obligation  of each Bank to make a B Advance  to any
particular  Subsidiary  Borrower on the occasion of each B Borrowing  (including
the initial Borrowing) is subject to the further  conditions  precedent that (1)
TBC shall have furnished to the  Administrative  Agent in connection with such B
Borrowing,  (x) a  Consolidated  statement of financial  position of TBC and its
Subsidiaries  as of the end of each of the first three  quarters of TBC's fiscal
year (other  than a quarter  ending  within  sixty days prior to the date of the
related  Notice of B  Borrowing)  and a  Consolidated  comparative  statement of
earnings  and  retained  earnings  of TBC and its  Subsidiaries  for the  period
commencing  at the end of the  previous  fiscal  year and ending with the end of
such quarter,  each certified by an authorized  officer of TBC and (y) a copy of
the annual audit report of TBC,  certified by independent  public accountants of
recognized  standing  acceptable  to the  Administrative  Agent,  together  with
financial  statements  consisting of a  Consolidated  statement of the financial
position of TBC and its Subsidiaries as of the end of the applicable fiscal year
and a  Consolidated  statement of earnings and retained  earnings of TBC and its
Subsidiaries  for such  fiscal year (the  applicable  fiscal year being the most
recent year with respect to which the annual audit report of TBC is due pursuant
to Section  4.01(a)(3)) and (2) on the date of such request and the date of such
Borrowing, the following statements shall be true, and each of the giving of the
applicable  Notice of B Borrowing and the  acceptance  by the  Subsidiary of the
proceeds of such B Borrowing  shall be (a) a  representation  by such Subsidiary
Borrower that:

                 (i) the representations and warranties contained (A) in Section
         3.01  hereof  with  respect to such  Subsidiary  Borrower  are true and
         accurate  on and as of each such date as though  made on and as of each
         such  date  (except  to  the  extent  that  such   representations  and
         warranties  relate solely to an earlier date),  and (B) in its Borrower
         Subsidiary  Letter  are true and  correct on and as of the date of such
         borrowing, before and after giving effect to such borrowing;

                 (ii)  as of  each  such  date  no  event  has  occurred  and is
         continuing,  or  would  result  from the  proposed  B  Borrowing  which
         constitutes  an Event of Default or would  constitute  such an Event of
         Default but for the requirement  that notice be given or time elapse or
         both; and

                 (iii) no event has  occurred  and no  circumstance  exists as a
         result  of  which  the  information  concerning  TBC or the  Subsidiary
         Borrower  that has been provided by TBC or the  Subsidiary  Borrower to
         the  Administrative  Agent  or the  Banks  in  connection  with  such B
         Borrowing would include an untrue  statement of a material fact or omit
         to state any material fact or any fact necessary to make the statements
         contained therein,  in light of the circumstances under which they were
         made, not misleading;

and (b) a representation by TBC that the  representations  and warranties of TBC
contained  in Section  3.01 are true and accurate on and as of each such date as
though  made on and as of  each  such  date  (except  to the  extent  that  such
representations  and warranties  relate solely to an earlier date), and that, as
of each such date, no event has occurred and is continuing, or would result from
the  proposed  A  Borrowing  which  constitutes  an  Event of  Default  or would
constitute such an Event of Default but for the requirement that notice be given
or time elapse or both.

                                    ARTICLE 6

                                Events of Default

                  Section 6.01.  Events of Default. The following shall
constitute the Events of Default:

                  (a) Failure by TBC to make when due any  payment of  principal
of or interest on any Note or the Guaranty when the same becomes due and payable
and such failure is not remedied within 5 Business Days thereafter.

                  (b)  When  any  representation  or  warranty  made  by  TBC in
connection with the execution and delivery of this  Agreement,  the Notes or the
Guaranty or otherwise  furnished  pursuant  hereto shall prove to be at any time
incorrect in any material respect.

                  (c)  Failure by TBC to perform  any other  term,  covenant  or
agreement  contained in this Agreement,  and such failure is not remedied within
15 days  after  written  notice  thereof  shall  have  been  given to TBC by the
Administrative Agent, at the request, or with the consent, of Banks representing
33-1/3% or more of the total of the Commitments.

                  (d) Failure of TBC to pay when due on any regularly  scheduled
payment  date any  obligation  for the  payment of borrowed  money or  following
acceleration  thereof  or of any other  monetary  obligation,  if the  aggregate
unpaid  principal amount of the obligation with respect to which such failure to
pay or acceleration  occurred equals or exceeds  $50,000,000 and such failure is
not remedied  within 5 Business  Days after notice  thereof is received from the
Administrative Agent or the creditor on such obligation.

                  (e)  TBC or any of its Subsidiaries

                        (1) shall incur  liability  with respect to any employee
                        pension  benefit plan in excess of  $150,000,000  in the
                        aggregate under

                               (A)  Sections  4062,  4063,  4064  or 4201 of the
                               Employee  Retirement  Income Security Act of 1974
                               ("ERISA"); or

                               (B) otherwise under Title IV of ERISA as a result
                               of any  reportable  event  within the  meaning of
                               ERISA (other than a reportable  event as to which
                               the  provision of 30 days' notice is waived under
                               applicable regulations);

                        (2) shall have or shall be likely to have a lien imposed
                        on its  property  and rights to property  under  Section
                        4068 of ERISA on  account  of a  liability  in excess of
                        $37,500,000 in the aggregate; or

                        (3)  shall incur or shall be likely to incur liability
 under Title IV of ERISA

                               (A) in excess of  $37,500,000 in the aggregate as
                               a result of the Company or any  Subsidiary or any
                               Person that is a member of the "controlled group"
                               (as defined in Section  4001(a)(14)  of ERISA) of
                               the  Company  or any  Subsidiary  having  filed a
                               notice  of  intent  to  terminate   any  employee
                               pension   benefit   plan   under  the   "distress
                               termination"  provision  of Section 4041 of ERISA
                               or

                               (B) in excess of  $37,500,000 in the aggregate as
                               a  result  of  the   Pension   Benefit   Guaranty
                               Corporation  having  instituted   proceedings  to
                               terminate,  or to  have a  trustee  appointed  to
                               administer, any such plan.

                  (f) The happening of any of the following events, provided the
same has not then been cured or stayed: (1) the insolvency or bankruptcy of TBC,
(2) the  cessation  by TBC of the payment of its debts as they  mature,  (3) the
making  of an  assignment  for the  benefit  of the  creditors  of TBC,  (4) the
appointment  of a trustee or receiver or liquidator for TBC or for a substantial
part of its property,  or (5) the  institution  of  bankruptcy,  reorganization,
arrangement,  insolvency or similar proceedings by or against TBC under the laws
of any  jurisdiction  in  which  TBC is  organized  or  has  material  business,
operations or assets.

                  (g) So long as any  Subsidiary  is a Borrower  hereunder,  the
Guaranty with respect to such Subsidiary  Borrower shall for any reason cease to
be valid and binding on TBC or TBC shall so state in writing.

                  If an Event of Default shall occur or be continuing, then, the
Administrative  Agent shall at the request,  or may with the  consent,  of Banks
having at least  33-1/3% of the total of the  Commitments,  by notice to TBC and
the affected Borrowers,  (A) declare the obligation of each Bank to make further
Advances to be terminated, whereupon the same shall forthwith terminate, and (B)
declare the Notes, all interest thereon and all other amounts payable under this
Agreement  to be  forthwith  due and  payable,  whereupon  the  Notes,  all such
interest  and all such amounts  shall  become and be forthwith  due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby  expressly  waived by the Borrowers  provided,  however,  that in the
event of any order for relief with  respect to the  Borrowers  under the Federal
Bankruptcy Code (whether in connection with a voluntary or an involuntary case),
(A)  the  obligation  of  each  Bank to make  Advances  shall  automatically  be
terminated  and (B) the Notes,  all such  interest  and all such  amounts  shall
automatically  become  and be due  and  payable,  without  presentment,  demand,
protest or any notice of any kind, all of which are hereby  expressly  waived by
the Borrowers.

                                    ARTICLE 7

                            The Administrative Agent

                  Section  7.01.  Authorization  and  Action.  Each Bank  hereby
appoints and authorizes the Administrative Agent to take such action as agent on
its behalf and to exercise such powers under this  Agreement as are delegated to
the Administrative  Agent by the terms hereof,  together with such powers as are
reasonably  incidental  thereto. As to any matters not expressly provided for by
this Agreement  (including without limitation,  enforcement or collection of the
Notes),  the  Administrative  Agent  shall  not  be  required  to  exercise  any
discretion  or take any action,  but shall be required to act or to refrain from
acting (and shall be fully  protected  in so acting or  refraining  from acting)
upon the  instructions of holders of more than 50% in principal  amount of the A
Notes then outstanding (or if no A Notes are at the time  outstanding,  upon the
instructions  of Banks  having  greater than 50% of the  Commitments),  and such
instructions shall be binding upon all Banks and all holders of Notes; provided,
however,  that the Administrative Agent shall not be required to take any action
which  exposes  the  Administrative  Agent  to  personal  liability  or which is
contrary to this Agreement or applicable law. The Administrative Agent agrees to
give to each Bank  prompt  notice of each  notice  given to it by the  Borrowers
pursuant to the terms of this Agreement.

                  Section 7.02.  Administrative  Agent's Reliance,  Etc. Neither
the Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action  taken or omitted to be taken by it or them under
or in  connection  with  this  Agreement,  except  for its or  their  own  gross
negligence  or  willful  misconduct.  Without  limiting  the  generality  of the
foregoing,  the Administrative Agent: (a) may treat the payee of any Note as the
holder thereof until the Administrative Agent receives and accepts an assignment
entered into by the Bank which is the payee of such Note,  as  assignor,  and an
Eligible  Assignee,  as assignee,  as provided in Section 2.18;  (b) may consult
with legal counsel  (including  counsel for the Borrowers ), independent  public
accountants  and other  experts  selected  by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in  accordance  with the
advice of such counsel,  accountants or other experts;  (c) makes no warranty or
representation  to any Bank and  shall  not be  responsible  to any Bank for any
statements,  warranties or representations  (whether written or oral) made in or
in connection with this  Agreement;  (d) shall not have any duty to ascertain or
to inquire as to the performance or observance of any of the terms, covenants or
conditions  of this  Agreement  on the part of any  Borrower  or to inspect  the
property  (including  the books and records) of any  Borrower;  (e) shall not be
responsible   to  any  Bank   for  the  due   execution,   legality,   validity,
enforceability, genuineness, sufficiency or value of this Agreement or any other
instrument  or  document  furnished  pursuant  hereto;  and (f)  shall  incur no
liability  under or in  respect of this  Agreement  by acting  upon any  notice,
consent, certificate or other instrument or writing (which may be by telecopier,
telegram, cable or telex) believed by it to be genuine and signed or sent by the
proper party or parties.

                  Section 7.03. Citibank, N.A. and its Affiliates.  With respect
to its  Commitment,  the  Advances  made by it,  and  the  Notes  issued  to it,
Citibank,  N.A.,  shall have the same rights and powers under this  Agreement as
any  other  Bank  and may  exercise  the  same as  though  it were  not an Agent
hereunder;  and the term "Bank" or "Banks"  shall,  unless  otherwise  expressly
indicated,  include Citibank,  N.A., in its individual capacity.  Citibank, N.A.
and its Affiliates may accept  deposits from, lend money to, accept drafts drawn
by, act as trustee  under  indentures  of, and  generally  engage in any kind of
business with, the Company, any of its subsidiaries and any person or entity who
may do business with or own securities of the Company or any subsidiary,  all as
if Citibank,  N.A. was not the Agent  hereunder  and without any duty to account
therefor to the other Banks.

                  Section 7.04.  Bank Credit  Decision.  Each Bank  acknowledges
that it has, independently and without reliance upon the Administrative Agent or
any other  Bank and based on the  financial  statements  referred  to in Section
3.01(e) and the  representations  and warranties  contained in Sections 3.01 and
3.02 and such other 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
Administrative  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 action under this Agreement.

                  Section  7.05.  Indemnification.  The Banks agree to indemnify
the  Administrative  Agent (to the  extent  not  reimbursed  by TBC or any other
Borrower),  ratably according to the respective principal amounts of the A Notes
then  held by each of them (or if no A Notes are at the time  outstanding  or if
any A Notes are held by persons  which are not Banks,  ratably  according to the
respective  amounts  of  their  Commitments),  from  and  against  any  and  all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs,  expenses or disbursements of any kind or nature  whatsoever which may be
imposed on, incurred by, or asserted against the Administrative Agent in any way
relating to or arising out of this  Agreement  or any action taken or omitted by
the  Administrative  Agent under this Agreement,  provided that no Bank shall be
liable  for any  portion  of such  liabilities,  obligations,  losses,  damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from the Administrative Agent's gross negligence or willful misconduct.  Without
limitation of the  foregoing,  each Bank agrees to reimburse the  Administrative
Agent promptly upon demand for its ratable share of any  out-of-pocket  expenses
(including counsel fees) incurred by the Administrative Agent in connection with
the preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through  negotiations,  legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities  under, this Agreement,
to the extent that the Administrative  Agent is not reimbursed for such expenses
by TBC or any other Borrower.

                  Section   7.06.    Successor    Administrative    Agent.   The
Administrative  Agent may resign at any time by giving written notice thereof to
the Banks and TBC and may be removed  at any time with or  without  cause by the
Majority Banks.  Upon any such resignation or removal,  the Majority Banks shall
have the right to appoint a  successor  Administrative  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 surplus of at
least  $50,000,000.  If no  successor  Administrative  Agent  shall have been so
appointed by the  Majority  Banks,  and shall have  accepted  such  appointment,
within 30 days after the  retiring  Administrative  Agent's  giving of notice of
resignation  or the  removal of the  retiring  Administrative  Agent as provided
herein,  then the  retiring  Administrative  Agent may,  on behalf of the Banks,
appoint a successor Administrative Agent which meets the requirements set out in
the previous sentence.  Upon the acceptance of any appointment as Administrative
Agent   hereunder  by  a  successor   Administrative   Agent,   such   successor
Administrative  Agent shall thereupon  succeed to and become vested with all the
rights, powers,  privileges and duties of the retiring Administrative Agent, and
the  retiring  Administrative  Agent  shall be  discharged  from its  duties and
obligations  under this  Agreement.  After any retiring  Administrative  Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Article 7 shall inure to its  benefit as to any  actions  taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.

                  Section  7.07.   Certain   Obligations  May  be  Performed  by
Affiliates.  The  Administrative  Agent may  appoint  any of its  Affiliates  to
perform  its  obligations  hereunder  other than any  obligation  requiring  the
Administrative  Agent to receive,  pay, or  otherwise  handle funds or Notes and
provided that the  Administrative  Agent shall continue to be responsible to the
Borrowers and the Banks for the due  performance of the  Administrative  Agent's
obligations under this Agreement.

                                    ARTICLE 8

                                  Miscellaneous

                  Section 8.01.  Modification,  Consents and Waivers. No failure
or  delay on the part of any Bank in  exercising  any  power or right  hereunder
shall operate as a waiver thereof,  nor shall any single or partial  exercise of
any such right or power  preclude any other or further  exercise  thereof or the
exercise  of any other right or power  hereunder.  No notice to or demand on the
Borrowers in any case shall entitle the Borrowers to any other or further notice
or demand in  similar  or other  circumstances.  No  amendment  or waiver of any
provision of this  Agreement or of the A Notes,  nor consent to any departure by
the Borrowers  therefrom,  shall in any event be effective unless the same shall
be in writing and signed by the Majority Banks,  and then such waiver or consent
shall be effective  only in the specific  instance and for the specific  purpose
for which given; provided,  however, that no amendment, waiver or consent shall,
unless in  writing  and signed by all the Banks,  do any of the  following:  (a)
waive any of the conditions specified in Section 5.01, 5.02, or 5.03, (b) except
as provided in Section 2.17 or Section  2.19,  increase the  Commitments  of the
Banks or  subject  the  Banks to any  additional  obligations,  (c)  reduce  the
principal of, or interest on, the A Notes or any fees or other  amounts  payable
hereunder,  (d)  postpone  any date fixed for any  payment of  principal  of, or
interest on, the A Notes or any fees or other  amounts  payable  hereunder,  (e)
change the percentage of the  Commitments or of the aggregate  unpaid  principal
amount of the A Notes or the  number of Banks  required  for the Banks or any of
them to take any action  hereunder,  (f) amend this  Section 8.01 or (g) release
TBC from any of its obligations under any Guaranty;  and provided further,  that
no  amendment,  waiver,  or consent  shall,  unless in writing and signed by the
Administrative  Agent in  addition  to the  Banks  required  above to take  such
action,  affect  the  rights or duties of the  Administrative  Agent  under this
Agreement or any Note.  Notwithstanding  the foregoing,  this Section 8.01 shall
not affect the provisions of Section 4.04 or 6.01.

                  Section 8.02.  Addresses for Notices.  All  communications and
notices  provided for  hereunder  shall be by telex or in writing and, if to the
Administrative Agent, mailed, telexed, faxed or delivered to it, addressed to it
at its office at Citibank, N.A., Global Aviation, 399 Park Avenue, New York, New
York 10043,  facsimile number (212) 793-3734,  Attention:  Relationship Manager,
and, if to any Borrower,  mailed,  telexed or delivered to it, addressed to such
Borrower,  care of The Boeing  Company,  at its office at 7755 East Marginal Way
South, Seattle,  Washington 98108,  facsimile number (206) 655-0799,  Attention:
Treasurer,  and,  if to any  Bank,  to its  office at the  address  given on the
signature pages of this  Agreement;  or, as to each party, at such other address
as shall have been  designated  by such party in a written  notice to each other
party referring specifically to this Agreement.

                  Section 8.03. Costs, Expenses and Taxes. TBC agrees to pay all
reasonable costs and expenses in connection with the preparation,  execution and
delivery of this Agreement, the Notes and the Guaranty (including printing costs
and  the  reasonable  fees  and  out-of-pocket   expenses  of  counsel  for  the
Administrative  Agent) and costs and expenses,  if any, in  connection  with the
enforcement  of this  Agreement,  the Notes and the  Guaranty  (whether  through
negotiations,  legal proceedings or otherwise and including, without limitation,
the reasonable fees and out-of pocket  expenses of counsel),  as well as any and
all stamp and other taxes,  and to save the Banks and other holders of the Notes
harmless  from any and all  liabilities  with respect to or  resulting  from any
delay by or omission of the  Borrowers to pay such taxes,  if any,  which may be
payable or  determined  to be  payable  in  connection  with the  execution  and
delivery of this Agreement, the Notes and the Guaranty.

                  Section 8.04. Binding Effect.  This Agreement shall be binding
upon and inure to the benefit of the Borrowers, the Banks and the Administrative
Agent,  and their respective  successors and assigns,  except that the Borrowers
may not assign or transfer  their  rights  hereunder  without the prior  written
consent of the Banks.

                  Section 8.05.  Severability.  Any provision of this  Agreement
which is prohibited  or  unenforceable  in any  jurisdiction  shall,  as to such
jurisdiction,   be   ineffective   to  the   extent  of  such   prohibition   or
unenforceability  without  invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

                  Section 8.06.  Governing Law. This Agreement,  the Notes,  the
Guaranty  and each  Borrower  Subsidiary  Letter shall be deemed to be contracts
under the laws of the State of New York and for all purposes  shall be construed
in accordance with the laws of such State.

                  Section 8.07.  Headings. The Table of Contents and Article
and Section headings used in this Agreement are for convenience only and shall
not affect the construction of this Agreement.

<PAGE>

                 Section 8.08. Execution in CounterpartsSection  8.08. Execution
in  Counterparts.   This  Agreement  may  be  executed  by  the  parties  hereto
individually or in any  combinations  of the parties hereto in several  separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same agreement.

                  Section 8.09.  Right of Set-Off.  Upon (i) the  occurrence and
during  the  continuance  of any  Event of  Default  and (ii) the  making of the
request or the  granting of the consent  specified  by Section 6.01 to authorize
the  Administrative  Agent to declare the Notes due and payable  pursuant to the
provisions of Section 6.01, each Bank is hereby  authorized at any time and from
time to time to the  fullest  extent  permitted  by law,  without  notice to any
Borrower (any such notice being expressly  waived by each Borrower),  to set off
and apply any and all deposits (general or special, time or demand,  provisional
or final) at any time held and other indebtedness at any time owing by such Bank
to or for the credit or the account of any  Borrower  against any and all of the
obligations  to such Bank of such Borrower now or hereafter  existing under this
Agreement and the Notes held by such Bank,  irrespective  of whether or not such
Bank shall have made any demand under this  Agreement or such Notes and although
such obligations may be unmatured.  Each Bank shall promptly notify any Borrower
after any such  setoff  and  application  made by such Bank,  provided  that the
failure to give such  notice  shall not affect the  validity  of such setoff and
application. The rights of each Bank under this Section are in addition to other
rights and  remedies  (including,  without  limitation,  other rights of setoff)
which such Bank may have.

                  Section 8.10. Agreement in Effect. This Agreement shall become
effective upon its execution and delivery,  respectively,  to the Administrative
Agent and TBC by TBC, the Administrative  Agent, and each Bank listed in Section
1.02.

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

                                         THE BOEING COMPANY

                                         By /S/ R. PAUL KINSCHERFF
                                         Title: Assistant Treasurer

                                         CITIBANK, N.A., Individually and
                                         as Administrative Agent

                                         By /S/ PHILIPPE PORTNOY
                                         Name: Philippe Portnoy
                                         Title:   Vice President

                                         THE CHASE MANHATTAN BANK,
                                         Individually and as Syndication Agent

                                         By /S/ MATTHEW H. MASSIE
                                         Name: Matthew H. Massie
                                         Title:   Managing Director

                                         ABN AMRO BANK N.V.

                                         By  /S/ DAVID J. THOMAS
                                         Name: David J. Thomas
                                         Title:   Group Vice President

                                         By  /S/ CARLA S. WAGGONER
                                         Name: Carla S. Waggoner
                                         Title:   Assistant Vice President

                                         AUSTRALIA AND NEW ZEALAND
                                         BANKING GROUP LIMITED

                                         By /S/ PETER N. GRAY
                                         Name: Peter N. Gray
                                         Title:   Vice President

                                         BANCA COMMERCIALE ITALIANA

                                         By /S/ CHARLES DOUGHERTY
                                         Name:    Charles Dougherty
                                         Title:   Vice President

                                         By /S/ T. GALLONETTO
                                         Name:    T. Gallonetto
                                         Title:   Assistant Vice President

                                         THE BANK OF NEW YORK

                                         By /S/ ROBERT LOUK
                                         Name:    Robert Louk
                                         Title:   Vice President

                                         THE BANK OF TOKYO-MITSUBISHI, LTD.

                                         By /S/ EIICHI MICHIZOE
                                         Name:    Eiichi Michizoe
                                         Title:   Deputy General Manager

                                         BANKBOSTON, N.A.

                                         By /S/ JOHN P. O'LOUGHLIN
                                         Name:    John P. O'Loughlin
                                         Title:   Vice President

                                         BANQUE NATIONALE DE PARIS

                                         By /S/ KATHERINE WOLFE
                                         Name:    Katherine Wolfe
                                         Title:   Vice President

                                         By /S/ SANDRA F. BERTRAM
                                         Name:    Sandra F. Bertram
                                         Title:   Assistant Vice President

                                         CREDIT LYONNAIS

                                         By /S/ PHILPPE SOUSTRA
                                         Name: Philppe Soustra
                                         Title:   Senior Vice President

                                         DEUTSCHE BANK AG NEW YORK AND/OR
                                         CAYMAN ISLANDS BRANCHES

                                         By /S/ JOEL MAKOWSKY
                                         Name:    Joel Makowsky
                                         Title:   Vice President

                                         By /S/ VIRGINIA MAHLER COSENZA
                                         Name:    Virginia Mahler Cosenza
                                         Title:   Vice President

                                         THE INDUSTRIAL BANK OF JAPAN,
                                         LIMITED

                                         By /S/ VICENTE L. TIMIRAOS
                                         Name:    Vicente L. Timiraos
                                         Title:   Senior Vice President & SDGM

                                         DEUTSCHE VERKEHRSBANK AG

                                         By_/S/ JUSTIN PATRICK
                                         Name: Justin Patrick
                                         Title:   Vice President

                                         By /S/ PAULA TRA NAH
                                         Name: Paula Tra Nah
                                         Title:   Assistant Vice President

                                         THE MITSUBISHI TRUST AND
                                         BANKING CORPORATION

                                         By /S/ SCOTT J. PAIGE
                                         Name:    Scott J. Paige
                                         Title:   Senior Vice President

                                         NATIONAL WESTMINSTER BANK PLC,
                                         NEW YORK BRANCH

                                         By /S/ SIMON CLARK
                                         Name:    Simon Clark
                                         Title:   Regional Financial Officer

                                         NATIONAL WESTMINSTER BANK PLC,
                                         NASSAU BRANCH

                                         By /S/ SIMON CLARK
                                         Name: Simon Clark
                                         Title:   Regional Financial Officer

                                         BANK OF AMERICA, N.A.

                                         By /S/ DEANNE PRUST ALLEN
                                         Name:    Deanne Prust Allen
                                         Title:   Vice President

                                         PNC BANK, NATIONAL ASSOCIATION

                                         By  /S/ PHILIP K. LIEBSCHER
                                         Name:    Philip K. Liebscher
                                         Title:   Vice President

                                         THE SUMITOMO BANK, LIMITED

                                         By /S/ BOB GRANFELT
                                         Name:    Bob Granfelt
                                         Title:   Vice President and Manager

                                         WACHOVIA BANK, N.A.

                                         By___________________________________
                                         Name:
                                         Title:

<PAGE>

                   SCHEDULE I TO THE AMENDMENT AND RESTATEMENT
                   COMMITMENTS AND APPLICABLE LENDING OFFICES

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------------

<S>   <C>                   <C>            <C>                                    <C>
      Name of Bank          Commitment     Domestic Lending Office                Eurodollar Lending Office

--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
ABN Amro Bank N.V.          $52,000,000    208 South LaSalle Street, Suite 1500   208 South LaSalle Street, Suite
                                           Chicago, IL 60604-1003                 1500
                                           Attn: Loan                             Chicago, IL 60604-1003
                                           Administration                         Attn: Loan
                                           Tel: (312) 992-5151                    Administration
                                           Fax: (312) 992-5156                    Tel: (312) 992-5151
                                                                                  Fax: (312) 992-5156
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
ANZ Bank                    $35,000,000    1177 Avenue of the Americas            1177 Avenue of the Americas
                                           6th Floor                              6th Floor
                                           New York, NY 10036-2798                New York, NY 10036-2798
                                           Attn: Peter Gray                       Attn: Peter Gray
                                           Tel: (212) 801-9739                    Tel: (212) 801-9739
                                           Fax: (212) 556-4839                    Fax: (212) 556-4839
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
Banca Commerciale           $35,000,000    555 Flower Street                      555 Flower Street
Italiana                                   43rd Floor                             43rd Floor
                                           Los Angeles, CA 90071                  Los Angeles, CA 90071
                                           Attn: Jack Wityak                      Attn: Jack Wityak
                                           Tel: (213) 624-0440                    Tel: (213) 624-0440
                                           Fax:                                   Fax:
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
The Bank of New York        $80,000,000    10990 Wilshire Blvd                    One Wall Street
                                           Suite 1125                             22nd Floor
                                           Los Angeles, CA 90024                  New York, NY 10286
                                           Attn: Robert J. Louk                   Attn: Sandra Morgan
                                           Tel: (310) 996-8663                    Tel: (212) 636-6743
                                           Fax: (310) 996-8667                    Fax: (212) 635-6877
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
The Bank of Tokyo-         $126,000,000    1201 Third Avenue                      1201 Third Avenue
Mitsubishi, Ltd                            Suite 1100                             Suite 1100
                                           Seattle, WA 98101                      Seattle, WA 98101
                                           Attn: David M. Purcell                 Attn:  Ken Johnson
                                           Tel: (206) 382-6049                    Tel: (206) 382-6021
                                           Fax: (206) 382-6067                    Fax: (206) 382-6067
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
BankBoston, N.A.            $66,000,000    100 Federal Street                     100 Federal Street
                                           Large Corporate 01-09-05               Large Corporate 01-09-05
                                           Boston, MA 02110                       Boston, MA 02110
                                           Attn: Judith Kelly                     Attn: Denise M. Dowd
                                           Tel: (617) 434-5280                    Tel: (617) 434-7462
                                           Fax: (617) 434-6685                    Fax: (617) 434-9933
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
Banque Nationale de         $40,000,000    180 Montgomery Street                  180 Montgomery Street
Paris                                      3rd Floor                              3rd Floor
                                           San Francisco, CA 94194                San Francisco,CA 94194
                                           Attn: D. Guy Gibb                      Attn: Don Hart
                                           Tel: (415) 956-0707                    Tel: (415) 956-2511
                                           Fax: (415) 296-8954                    Fax: (415) 989-9041
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
The Chase Manhattan Bank   $153,000,000    270 Park Avenue                        270 Park Avenue
                                           New York, NY 10019                     New York, NY 10019
                                           Attn: Matthew Massie                   Attn: Matthew Massie
                                           Tel: (212) 270-5432                    Tel: (212) 270-5432
                                           Fax: (212) 270-5100                    Fax: (212) 270-5100
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
Citibank, N.A.             $153,000,000    399 Park Avenue                        399 Park Avenue
                                           12th Floor, Zone 2                     12th Floor, Zone 2
                                           New York, NY 10043                     New York, NY 10043
                                           Attn: Philippa Portnoy                 Attn: Philippa Portnoy
                                           Tel: (212) 559-5812                    Tel: (212) 559-5812
                                           Fax: (212) 793-1246                    Fax: (212) 583-7185
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
Credit Lyonnais            $100,000,000    1301 Avenue of the                     1301 Avenue of the
                                           Americas                               Americas
                                           New York, NY 10019                     New York, NY 10019
                                           Attn: Bertrand Cousin                  Attn: Kenia A. Perez
                                           Tel: (212) 261-7363                    Tel: (212) 261-7313
                                           Fax: (212) 261-7368                    Fax: (212) 261-7368
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
Deutsche Bank AG New       $106,000,000    31 West 52nd Street                    31 West 52nd Street
York and/or Cayman                         New York, NY 10019                     New York, NY 10019
Islands Branches                           Attn: Joel D. Makowsky                 Attn: Noble Samuel
                                           Tel: (212) 469-7896                    Tel: (212) 469-4091
                                           Fax: (212) 469-8212                    Fax: (212) 469-4139
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
The Industrial Bank of     $100,000,000    350 South Grand Avenue                 1251 Avenue of the Americas,
Japan, Limited                             Suite 1500                             31st Floor
                                           Los Angeles, CA 90071                  New York, NY 10020-1104
                                           Attn: Blake Seaton                     Attn: Svayan Ghosh-Mazumdar
                                           Tel: (213) 893-6448                    Tel: (212) 282-4093
                                           Fax: (213) 488-9840                    Fax: (212) 282-4480
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
International Transport     $20,000,000    609 Fifth Avenue                       609 Fifth Avenue
Finance Ltd.-Deutsche                      New York, NY 10017-1021                New York, NY 10017-1021
VerkehrsBank                               Attn: Constance Laudenschlager         Attn: Constance Laudenschlager
                                           Tel: (917) 322-3949                    Tel: (917) 322-3949
                                           Fax: (212) 588-8936                    Fax: (212) 588-8936
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
The Mitsubishi Trust       $133,000,000    520 Madison Avenue                     520 Madison Avenue
and Banking Corporation                    New York, NY 10022                     New York, NY 10022
                                           Attn: Joe Shammas                      Attn: Ming Hwa Chou
                                           Tel: (212) 891-8451                    Tel: (212) 891-8263
                                           Fax: (212) 644-6825                    Fax: (212) 755-2349
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
National                    $52,000,000    65 East 55th Street                    65 East 55th Street
Westminster Bank Plc                       New York, NY 10022                     New York, NY 10022
                                           Attn: Commercial Loan Dept.            Attn: Commercial Loan Dept.
                                           Tel: (212) 401-1424                    Tel: (212) 401-1424
                                           Fax: (212) 401-1494                    Fax: (212) 401-1494
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
Bank of America            $133,000,000    444 South Flower Street,               901 Main Street
                                           Suite 400                              Dallas, TX 75202
                                           Los Angeles, CA 90071                  Attn: Karen Puente
                                           Attn: George V. Hausler                Tel: (214) 508-3089
                                           Tel: (213) 236-4925                    Fax: (214) 508-0944
                                           Fax: (213) 624-5815
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
PNC Bank, National          $66,000,000    One PNC Plaza, 2nd Fl.                 One PNC Plaza, 6th Fl.
Association                                249 Fifth Avenue                       249 Fifth Avenue
                                           Pittsburgh, PA 15222                   Pittsburgh, PA 15222
                                           Attn: Philip K. Liebshcer              Attn: Sally Hunter
                                           Tel: (412) 762-3202                    Tel: (412) 768-3807
                                           Fax: (412) 762-6484                    Fax: (412) 768-4586
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
The Sumitomo Bank,          $70,000,000    777 South Figueroa                     777 South Figueroa
Limited                                    Suite 2600                             Suite 2600
                                           Los Angeles, CA 90017                  Los Angeles, CA 90017
                                           Attn: Miriam Delgado                   Attn: Miriam Delgado
                                           Tel: (213) 955-0883                    Tel: (213) 955-0883
                                           Fax: (213) 623-6832                    Fax: (213) 623-6832
--------------------------------------------------------------------------------------------------------------------

<PAGE>

--------------------------------------------------------------------------------------------------------------------
Wachovia Bank, N.A.         $80,000,000    191 Peachtree Street, NE               191 Peachtree Street, NE
                                           Atlanta, GA 30303                      Atlanta, GA 30303
                                           Attn: John Whitner                     Attn: Gloria Freeman
                                           Tel: (404) 332-6738                    Tel: (404) 332-6485
                                           Fax: (404) 332-6898                    Fax: (404) 332-6898
--------------------------------------------------------------------------------------------------------------------

     TOTAL OF              $1,600,000,000
     COMMITMENTS
</TABLE>EXHIBIT 10.2

                                                               March 27, 2000

To each of the Banks
parties to the Credit Agreement
(as defined  below) and to Citibank N.A.,
as Administrative Agent for such Lenders

Ladies and Gentlemen:

                  Reference is made to The Boeing  Company  Amended and Restated
364-Day Bank Credit  Agreement  dated as of September  29, 1999 among The Boeing
Company (the  "Company"),  certain other borrowers  parties  thereto,  the Banks
named therein,  Citibank N.A., as  Administrative  Agent for said Banks, and The
Chase  Manhattan  Bank,  as  Syndication  Agent  for  said  Banks  (the  "Credit
Agreement").  Terms used herein and defined in the Credit  Agreement  shall have
the respective meanings ascribed to such terms in the Credit Agreement.

                  Please be  advised  that the  Company  hereby  designates  its
undersigned Subsidiary, Boeing Capital Corporation ("Subsidiary Borrower"), as a
"Subsidiary  Borrower" under and for all purposes of the Credit  Agreement.  The
Subsidiary  Borrower is  authorized to draw up to but no more than $1 billion in
total aggregate outstanding draws.

                  The  Subsidiary  Borrower,  in  consideration  of each  Bank's
agreement to extend credit to it under and on the terms and conditions set forth
in the Credit Agreement, does hereby assume each of the obligations imposed upon
a "Subsidiary  Borrower" and a "Borrower"  under the Credit Agreement and agrees
to be bound by the terms and conditions of the Credit Agreement.  In furtherance
of the foregoing, the Subsidiary Borrower hereby represents and warrants to each
Lenders as follows:

                  (a) The Subsidiary  Borrower is a corporation  duly organized,
         validly  existing and in good standing under the laws of Delaware.  The
         Subsidiary  Borrower is qualified to do business in every  jurisdiction
         where such  qualification  is required,  except where the failure to so
         qualify  would not have a materially  adverse  effect on the  financial
         condition of the Company and the Subsidiary Borrowers as a whole.

                  (b) The execution,  delivery and performance by the Subsidiary
         Borrower of this Subsidiary  Borrower Letter,  the Credit Agreement and
         its Notes are within the Subsidiary  Borrower's  corporate powers, have
         been duly authorized by all necessary  corporate action,  have received
         all necessary  governmental  approval (which  approval  remains in full
         force and effect),  and do not contravene any law, any provision of the
         Subsidiary Borrower's charter or by-laws or any contractual restriction
         binding on the Subsidiary Borrower.

                  (c) This  Subsidiary  Borrower Letter is, and the Notes of the
         Subsidiary  Borrower when duly executed and delivered by the Subsidiary
         Borrower,  will constitute legal, valid and binding  obligations of the
         Subsidiary  Borrower,  enforceable  against the Subsidiary  Borrower in
         accordance with their respective terms.

                  (d) In the Subsidiary Borrower's opinion, there are no pending
         or threatened actions or proceedings before any court or administrative
         agency which can reasonably be expected to materially  adversely affect
         the financial condition or operations of the Subsidiary Borrower or any
         Subsidiary.

                  (e) The  Consolidated  statement of  financial  position as of
         December  31, 1999 and the related  Consolidated  statement of earnings
         and  retained  earnings  for the year then ended  (copies of which have
         been  furnished  to each  Bank)  correctly  set forth the  Consolidated
         financial condition of the Company and its Subsidiaries as of such date
         and the result of the Consolidated  operations for such year, and since
         such date there has been no material  adverse  change in such condition
         or  operations  which is likely to impair the ability of the Company to
         repay Advances.

                  (f) The Subsidiary  Borrower is not engaged in the business of
         extending credit for the purpose of purchasing or carrying margin stock
         (within the meaning of Regulation U issued by the Board of Governors of
         the Federal  Reserve  System),  and no proceeds of any Advance  will be
         used to  purchase  or carry any  margin  stock or to  extend  credit to
         others for the  purpose of  purchasing  or carrying  any margin  stock.
         Following application of the proceeds of each Advance, not more than 25
         percent of the value of the assets (either of the  Subsidiary  Borrower
         only  or  of  the  Subsidiary   Borrower  and  its  subsidiaries  on  a
         consolidated basis) subject to the provisions of Section 4.02(a) of the
         Credit Agreement will be margin stock (within the meaning of Regulation
         U issued by the Board of Governors of the Federal Reserve System).

                  (g) The Subsidiary Borrower is not an "investment company," or
         an  "affiliated  person" of, or "promoter"  or "principal  underwriter"
         for,  an  "investment  company,"  as  such  terms  are  defined  in the
         Investment  Company Act of 1940, as amended.  Neither the making of any
         Advances,  nor the application of the proceeds or repayment  thereof by
         the Subsidiary Borrower, nor the consummation of the other transactions
         contemplated  hereby,  will  violate any  provision  of such Act or any
         rule,  regulation or order of the  Securities  and Exchange  Commission
         thereunder.

                                             Very truly yours,

                                             THE BOEING COMPANY

                                             By: /S/ WALTER SKOWRONSKI
                                                 Walter Skowronski
                                                 Vice President & Treasurer

                                             BOEING CAPITAL CORPORATION

                                             By: /S/ THOMAS MOTHERWAY
                                                 Thomas Motherway
                                                 President

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